Brick’s Blog

     Last week, I was thinking about blogging on RealtyTrac and all their self-proclaimed foreclosure rates, which I had been hearing on the news, seeing in print, and didn’t I see some sky writing by them, too?  Over the weekend, I decided to "Google" them and find out what they were about. One thing I discovered, they are pretty good publicists, since they had no problem getting all the media outlets to publish their claims. 

     Well, Lordy, Lordy, guess what happens before I can blog them. Tuesday evening I am proceeding home and hear on WRVA 1140 about the 800 % jump in foreclosure rates in Virginia claimed by RealtyTrac. I immediate called WRVA and spoke to Matt who had written this piece and asked him if he had "googled" RealtyTrac. I also gave him my quick spin on RealtyTrac. I must have been convincing, because the report was not repeated in the next half hour news segment. My real problem is how long this report had been aired, since its root was in this article published Tuesday in the RTD.

     Now I know I am a little late on this issue,(sorry, been playing golf, since the sky is falling according to RealtyTrac and who knows if golf is even played in heaven), so I have just gotten around to addressing these claims. Here’s a copy of an e-mail I sent Marilyn J. Shaw at the RTD. I’ll let you know if I get a response.

Ms. Shaw –

 

I hope you researched this claim by RealtyTrac before publishing. If you will “Google” RealtyTrac, you will see more reliable sources such as the Mortgage Bankers’ Association dispute many of their claims. It is amazing that RealtyTrac has suddenly become the SELF PROCLAIMED experts on foreclosure rates. Their web site has been in existence for a very short time. They are what the real estate business calls “aggravators”. Through their website and their CLAIMS, they attract investors, real estate agents, etc. and then try to sell them their services.

 

Go sign up for their 7 day free trial. It will still require you to enter a credit card, etc. to have the “free” trial with the hope you’ll forget to cancel within the 7 days. Sign up to be one of their partners. If you’re a real estate agent, you will immediate receive a call you, which will try to sell you “an exclusive zip code” on a month to month basis. This business model for real estate has been in existence for many years (i.e., HomeGain, HomeValues, HouseHunt.com, etc.). RealtyTrac just happens to be the only one working the foreclosure market and very successfully so, since the media just accepts whatever they claim as gospel.

 

I realize your article had a disclaimer about the possible double counting by RealtyTrac, but may I suggest a possible quick check on their outrageous claims. Since Media General publishes in numerous markets, your advertising division should be experiencing record revenue in the legal notice section if RealtyTrac’s claims are true. All foreclosures require a set number of publication notices prior to sale. If Virginia is truly up “798 percent” Media General’s revenue should reflect this. Of course, should you find RealtyTrac’s claims exaggerated, I hope there will be a retraction. Hope, but doubt, since newspapers are sold with headlines and not facts.  

     While August 2007 home sales in the Richmond area lagged August 2006 sales by 12 % or 197 less units, I was actually surprised by how strong the market performed despite the constant negative drumbeat by the media. If you believe everything the media is currently portraying about the housing market, then your home is already in foreclosure and your adjustable rate mortgage just hit 18 % and will go higher next week. Poppycock! Mortgage rates are great, unemployment is at all time lows, home ownership remains at all time highs, and the financial markets continue to shake off every new crisis thrown at them. And while year to date sales are down 6 % from 2006 and 7.7 % from the record year of 2005, here’s a HEADLINE you won’t hear from the media. The average sales price for the Richmond area is up over 5.5% from the 2006 average sale price. If the sky was falling, shouldn’t  the prices be falling, too? Oh, if you’re wondering, the 2007 average sales price versus the 2005 average sales price – a staggering 19.6% higher. I can assure you of one thing – the house you buy today will be worth more next year and the following year ad infinitum. Here’s the year to date table.

      This marker can be found at an intersection in Hanover County. It’s inscription is below:  

Late in the morning of 12 June 1862, Confederate Brig. Gen. J. E. B. Stuart and 1,200 cavalrymen reached this intersection on a mission to gather intelligence about Union Maj. Gen. George B. McClellan’s Army of the Potomac. Here Stuart’s column turned sharply northeast, in the general direction of Ashland. Having put some distance between his force and the Federal army around Mechanicsville, Stuart could move directly toward the upper end of the county. He maneuvered along these roads with confidence, since many of the men in his command, who guided the expedition, were Hanover County natives.

     For a Starbucks or Blockbuster gift card. 1.) Identify the intersection. 2.) This was a precursor to an event that started the next day and lasted until June 15, 1862. Name the event.

     It wasn’t that many years ago that I could count the million dollar sales in the Richmond area for the year on one hand. These days 2 hands are about a month’s activity for these sales. Through August, there have been 78 sales in the metro area at a million plus. Of course, the ever fashionable West End (Zone 20) leads all other locales with 21 sales to date. Here’s a fun little fact for Chas and Muffy to drop at their next cocktail party. About every 14th home that sells in Zone 20 in ‘07 sells for a million plus.  

     Number 2, and trying harder, is Goochland (Zone 24) with 18. Shhhhh, don’t tell anyone but the average million dollar sale in Goochland is $1,687,000, while their poor City cousins only averaged $1,624,187. And if you’re hanging out at the Jack Russell races at the next equestrian event, you might overhear that every 12th home that sells in Goochland breaks the mil barrier.

     The valley of humility between these two areas is the West End of Henrico (Zone 22), which has had 13 million plus sales. Must be something about those Real Estate Zones with a twenty prefix. We just accounted for 2/3 of all the sales. Now you know why Horace Greeley (actually, he got it from John Soule) popularized "Go west, young man….." 

     SOJ…South of the James, for you unwashed, finds the Midlothian area (Zone 64) touting 11 million plus sales. Oh, those River Roaders could never accept being surpassed by the Robious Roaders. Maybe the pronunciation really is Pow’hite Parkway and not Po’white.

     The remaining sales: Fan 2 (Zone 10); Glen Allen 4 (Zone 34); Hanover 5 (4 in Zone 36, 1 in Zone 44), Chesterfield 1 (Zone 52), SOJ City of Richmond 1 (Zone 60) and Powhatan 2 (Zone 66). Now go out and impress someone with your new knowledge! 

     Oh, the house in the picture. Not for sale, although it has had extensive remodeling recently. You can live in it for 4 years at the taxpayers’ expense. All you have to do is be elected Governor. Look, if Tim Kaine can do it, the bar ain’t that high!

     As you know, I report monthly market conditions to Realty Times. Here are my comments for August:

            Okay, Brick, you’re always so positive. So tell me something good about the Richmond Real Estate Market.

 

Where do you want to start? Rates are fantastic. Yes, you’ll have to put something into the transaction, but you’ve always known there was “no free lunch.” Besides, my lenders are hungry and they’ve got lots of innovative programs. The selection of properties is simply UNBELIEVABLE. A buyers’ real problem is separating the wheat from the chaff. There are so many good buys out there, but they’re lost among all the inventory. So instead of looking at 10-15 homes to make a decision, you should look at 30. And if your agent is any good, they’ll jump up and down when they think you’re passing up an opportunity. I know that’s what I would do. I’ll also bang on the desk, if you’re making a mistake. Want more?

 

I know I sound like a broken record, but sales price/list price ratio is showing very little discounting – under 2 % depending on the area. Believe it or not, dollar per square foot costs are very level; and in many areas, the cost is up for the year. Days on market for sold properties have stabilized at approximate 60 days.

 

The market is very bottom driven. Through August, 66 % of the total sales for the year sold at under $300,000 with 83 % of the sales at under $400,000. 1 in 3 sales for the year have had a sales price between $200,000 – $299,999.

 

While 2007 sales for the Richmond area are trailing 2006 sales by approximately 5% presently, August final numbers, which should be out in about a week, should equal August 2006 numbers. My real concern is for the final 4 months of 2007, since pending sales were off significantly in August. My projection for 2007 sales suggests we may end 2007 with 8 % less sales or 1,200 fewer sales. The difference between 2006 and the record year of 2005 was less than 400 sales, so this is a significant drop.

 

So why the big drop? Weak job market? Lousy mortgage rates? Horrible economy? No, no and no. It’s the media as usual. They’ve been calling for the real estate meltdown for 7 years. Well, now they’ve got it from hyping the sub prime mortgage markets. I hope every media person gets their dream job requiring relocation, but don’t get offered a relocation package and are then forced to sell their home in this market they have created.

 

If you’re a buyer, there are and will be some incredible opportunities arising as we progress through the year. “Must Sell” situations are increasing; and with them fantastic opportunities for “in the know” buyers. So how do you become an “in the know” buyer? Find a skilled negotiator and listen to what they have to say.

 

To assist you in becoming an “in the know” buyer, I am adding some new statistics to my monthly reporting. From now on, I will show the sale activity by price ranges with a percentage for what those price ranges comprise of the particular market. For buyers, you’ll be able to know if your desired price range can be obtained in particular area and how many homes have sold in that range. For you sellers, you’ll be able to project the type of activity you should see. For you homeowners, if your home’s value falls within a range with a particular high percentage activity, it may well be time to move up and pick off one of those "must sell" situations.

Here’s a sample of my new reporting. This breakdown is for the entire Metro Area (Richmond – Zones 10, 20, 30, 50, & 60; Henrico – Zones 22, 32, 40, & 42; Hanover – Zones 36 & 44; Chesterfield – Zones 52, 54, 62 & 64; Goochland – Zone 24; and Powhatan – Zone 66.

Metro Richmond Sales

Through August 2007

Price Range	# of Sales	% of Ttl Sales
0 – 99,999	363	4.01%
100,000 – 199,999	2,567	28.38%
200,000 – 299,999	3,064	33.88%
300,000 – 399,999	1,520	16.81%
400,000 – 499,999	702	7.76%
500,000 – 599,999	320	3.54%
600,000 – 699,999	200	2.21%
700,000 – 799,999	112	1.24%
800,000 – 899,999	71	0.79%
900,000 – 999,999	47	0.52%
1 Million plus	78	0.86%

 

Now more than anytime recently, sellers need a seasoned agent. Pricing and marketing homes to sell is learned through experience. Don’t trust your largest asset to some green agent and certainly not to any agent who tells you exactly what you want to hear. Hire a PRO. I am and have been one for years.

     I compile assorted statistical information each month on the area’s real estate market. Here’s a quick snapshot of various areas that I am currently examining. I intend to make this a monthly post. If there is a particular submarket in the Richmond area, you would like to see covered, please comment on the particular area. If viable (enough monthly sold activity), I’ll include it in next month’s post. These numbers are compiled from Central Virginia Regional Multiple Listing Service. Obviously, sold units only account for those using the services of a Realtor.   

     This should get a special award for the winner other than a Starbucks or Blockbuster gift card. I am still debating what the winner will receive.

This monument memorializes an event that occurred on May 11, 1864. Name the event. And the real clincher, tell me where this monument is located. Must give specific directions. Good Luck!  

     Weather permitting, I have a weekly golf match with a fraternity brother of mine. We’re probably going on 10 years of playing weekly – always mid week. A simple $2 Nassau, with $1 trash for greenies, birdies, and sandies. I keep track of the money and the stats for the trash. At year end, usually around November, the money leader gets to claim a trophy; and significantly more important, the bragging rights over the other for the winter layoff. We also have a Tiger Woods’ bobble head, which goes to one who makes the most birdies during the year. Currently, I hold the bobble head from ‘06, while my pal, Ron, has the trophy.

     We refer to our competition, as do many of our mutual friends, as the Las House Classic. Although my buddy, Ronald Alva Cain, Jr., is 5 years my junior and actually a classmate of my younger brother, Walter, we been running mates for 30 years now. As do most males who have been friends that long, you have nicknames for each other. I am the House. Not because I sell them, but because during my second go-round at UVA when I met Ron, the song, Brick House, was huge. 

     How Ron became Las is much more convoluted. I have another fraternity brother and classmate, Jim Farmer. Since Jim and I were pledges together, my misbehaving with and nicknaming of Jim had a 5 year head start on Ron. Sometime in the earlier 80’s, Ron and Jim were dating two girls who were friends and roommates. At this stage in Jim’s life, he was seeing the sun rise on many a weekend morning. Due to Jim’s "always open never closed" lifestyle, I started referring to him as Vegas. Now that Ron was often in Jim’s company, since they were dating roommates, he became Las. Las Vegas, get it. 25 plus years later, Ron is still Las. Jim is now still Chili Vegas and you don’t want to know why the Chili was added. 

     Before I blogged and only when I was winning, I would write articles about our matches, which I would then circulate among our mutual friends. The gist of all of these stories were naturally what a better golfer I was than Ron. I still have most of them, and if any, are topical, I might post them. Currently, Las holds a $17 lead in the money for ‘07, while I am ahead on the birdie count by 1. There are 2 months or about 8 more matches before the LHC trophy is awarded for the year. Just like the Chase or the FedEx Cup, it’s time for me to kick it in to high gear. If you don’t hear anymore about this, than you can guess the consequence – the LHC Trophy is residing elsewhere this winter. Give a nod to the Golf Gods for me, would ya?  

     The older I get the less interest I have in sports. One by one the sports that I loved and followed slowly and eventually lose all interest for me. It’s as if they lose their innocence and become tainted. Pro football was one of the first to go. Not sure if it was when Jack Kent Cooke didn’t pick up Sonny’s contract for that last year that sealed it for me, but probably close to then that I slowly and surely lost all interest in pro football.

      College basketball was next. I use to love ACC basketball, especially when Jefferson Pilot aired the games. I’d watch them all. Again, I can’t recall the exact event or reason I lost interest. Not sure, don’t remember, don’t care, but was probably when when Len Bias died of a cocaine overdose right after signing with the Boston Celtics. 

     Baseball? I have commented on this before, I use to love baseball, October 26, 2006. So maybe it wasn’t really when Fay Vincent resigned, but I do know the 1994 strike was definitely a final deathknell for me. Well, I did go to Fenway once after that, but I was in Boston and it was opening day. Clemens pitched. It was ‘95 or so.

     All week, I have been thinking I needed to write something about NASCAR, since we’ve got a race here Saturday night. Coming home last night, I heard an ad on the radio for Dale on CMT. Watched it, loved it, and since it is rerunning again tonight, count me in. Earlier this year, I commented on the state of NASCAR right before the Daytona 500, Goodbye, NASCAR, February 14, 2007.  So tonight while I am watching Dale, (CMT, Comcast Channel 69 at 8 p.m.), I am going to bide my final farewell to NASCAR. When Dale Earnhardt, Jr. won’t even be driving for DEI (i.e., Dale Earnhardt, Inc.) and won’t have the 8 car next year (you know Dale Jr’s grandpappy, Ralph, drove the 8 car first), it is definitely time to move on. Hell, some guy with a name like Montoya driving a Toyota will probably win the 50th Daytona next year. 

    Step-mothers, I got one, too, Jr., so I know how he feels.  

     While I am sure the perception of me is some old curmudgeon, I think, although my wife and children might disagree, that I am a relatively happy go lucky kinda fella. Sure I have some banes to my daily existence. Most of which would disappear, if those around me showed any civility or occasionally exercised some common sense. This year, one of my worst daily experience is now kaput. Well, not truly kaput, but is irrelevant to me. You see I no longer have to endure the Collegiate Middle School carpool line. (My Personal Purgatory Began Today – August 26, 2006.) My son, Stuart, is now charged with the daily duty of delivering his sister to school each morning. Free at last. Free at last. Hallelujah, I am free at last!

     Well, maybe not completely free. I still need to manuever out of my neighborhood each morning as I venture forth to face the world. I don’t know about you, but I learned fairly early in my childhood that you walked facing traffic. Later on, when I mastered riding a bicycle, I was taught you ride WITH traffic. Okay, maybe it wasn’t kindergarten, but I know it was before I was 10 that these simple rules were ingrained in my head. Then, why doesn’t anyone in my neighborhood seem to know them.

     Look, I’ve got nothing against walkers, joggers, baby strollers, and even your dogs on long leashes. I don’t care if you do any of these things three abreast and taking up half of the road. Just do them on the left side of the road. Doesn’t matter which way you’re facing, just be on the left side. Got it? That way you’ll see me and I’ll see you. Thank you!