August 28, 2011

What is Shadow Inventory?

Burbed doesn’t usually feature home listings on weekends.  Instead we either have thoughtful wonky pieces, commentary on news articles about the wonderful world of real estate, or just random filler for an Open Thread.  Our readers aren’t in their offices avoiding work wasting time performing valuable research by visiting here, so it really doesn’t matter what we run on Saturday and Sunday.  Everyone is out enjoying the beautiful weather and the Open Houses.

Today, we have a Reader Submission appropriate for a weekend piece.  Please enjoy this look at “shadow inventory” by Burbed reader MS.  Thanks very much!


What is shadow inventory?  According to a friendly Realtor’s blog, there’s “nothing to see.”

image

The proof, she says, is REO vs. regular sales.

 

Month REO Sales Regular Sales
January 3 72
February 2 59
March 4 75

How many short sales are called “regular” sales here? Half?  A Redfin search of SFRs (Single-Family Residences) under 500K in 94401 shows that six of 14 are short sales. Like this one:

 

120 HURON Ave, San Mateo, CA 94401
$370,000

image

(Back from being pending, tenant occupied, listed since 2010.)  And down the street

image

Finally, shadow inventory comprises properties that have received NODs (notice of default) and/or are scheduled for foreclosure auction, such as these (318 in San Mateo County):

image

MLS listing isn’t required to be on the auction block at Redwood City (and if a house is MLS-listed, it can still be auctioned off.)

image

So that, Miss Realtor, is your shadow inventory.

Comments (94) -- Posted by: madhaus @ 5:07 am

94 Responses to “What is Shadow Inventory?”

  1. Alex Says:

    pfththhthththth!!

    You know what Real Excreter would say about this data…

  2. SEA Says:

    I don’t know about all this fancy attempts to prove that ‘shadow inventory’ does not exist. Why not get back to those basics of what sellers want: High selling prices. How many homes do you think would come on the market if prices suddenly doubled?

    I know a few people who would love to sell at their purchase prices, but, alas, that’s not happening anytime soon. Are these sellers in the so-called ‘shadow inventory?’ Just as much as banks who don’t want to sell at current market prices.

    My guess: The entire Las Vegas metro area is shadow inventory, less the homes that are already listed.

    Ultimately nearly every property, individually, is part of the shadow inventory, but we don’t know the price. The question is how much would it take to make the owner move. Before the peak, I know a guy who was offered about three times what he thought his property was worth, but he had to be out within 60 days. The buyer wanted his property, and for the price, he sold. He didn’t even realize he wanted to sell.

    On the other end might be the ‘shadow buyers.’ All the buyers who are willing to pay less than the owner is willing (and able) to take. I’m a shadow buyer on many properties.

  3. The Gilroy Alex Says:

    uhh, whuhh, whut? try to catch a falling knife.

  4. Divasm Says:

    To be fair, there are houses that appear in preforeclosure or even have notices of default but that doesn’t mean they will sell soon at auction. Houses get rescheduled all the time after being scheduled for auction – it seems like there is enough red tape in place that the number of actual homes sold at auction on the Redwood City Courthouse steps is still a much smaller number.

    For a while we used Foreclosures.com to search for San Mateo County REOs on a regular basis and I rarely found anything older than 3-4 months that hadn’t been flipped by the bank already.

  5. SEA Says:

    In a down market, no matter the average length of the process, sooner or later many will reach the end.

  6. madhaus Says:

    Who knows what evil lurks in the inventory of San Mateo County?

    The Shadow Knows. Ha ha ha ha ha!

  7. ms Says:

    Miss Realtor is claiming that few REOs means that shadow inventory doesn’t exist.
    She would have been more honest had she said, look, there’s a gigantic constipated backlog of unavailable inventory in the notice of default –> trustee deed pipeline. So what you see is what there is in the near future.

  8. Divasm Says:

    #7, I agree…although I’m going to give her the benefit of doubt and assume the Realtard believes what she’s saying and she’s ignorant and/or stupid, not dishonest. 🙂

  9. ms Says:

    Divasm:
    On Recontrust and Foreclosureradar, I’d watch “short sale” listings get put on the auction calendar, go pending, get taken off the auction calendar, go BOM, get put back on the auction calendar.
    Just part of amend-extend-pretend, designed to reward all sides who screwed up in 2006.

  10. madhaus Says:

    Divasm, I’m going to share a quote that applies here (and credit to Pralay, I think, for bringing it up long ago).

    “It is difficult to get a man to understand something, when his salary depends upon his not understanding it!”
    — Upton Sinclair

  11. Real Estater Says:

    Clearly not enough inventory in Palo Alto:

    Asking price: $1.1M
    Sold price: $1.985M
    1140 sq. house, 2 bedrooms, 1 bath

  12. Real Estater Says:

    By the way,check out the table of Median House values. 94301 is over $1000 / SF, like I’ve been saying all along. Proof is in the pudding. No downturn here.

  13. Real Estater Says:

    Speaking of inventory, I’ve been watching with some interest the complete lack of turnover at the new housing development in Sunnyvale near Fremont / Hollenbeck. Everybody must be completely happy there, because so far nobody is selling.

  14. ms Says:

    #8: Check out Miss Realtor’s first sentence in her blog:
    “It was taking 15 months — now down to 12 months — to get through the foreclosure process.”
    Then two more paragraphs follow where she explains where much of the shadow inventory is (i.e. constipated painful log, there).
    THEN she states that she, as a Realtor (TM) hasn’t seen aforementioned shadow inventory. She states that WELLS FARGO assures her there isn’t any. Finally, the Peninsula isn’t even RBA. It’s uber super-special RBA. Therefore the inventory she herself demonstrated exists does not exist.

  15. Divasm Says:

    Madhaus, I love that Upton Sinclair quote…all right, I see your point MS and Madhaus, she’s both stupid AND dishonest!

    As for #11, that house is clearly Super Special RBA, as it’s 2 streets down from none other than Steve Jobs, as we saw in yesterday’s blog…there’s never enough inventory to stalk a world-famous former CEO!

  16. SEA Says:

    My favorite home in PA right now:

    1184 PALO ALTO Ave

    That’s right, Palo Alto in both the street and city for twice the Palo Alto enjoyment.

    But that’s not what makes it my favorite. I like the instant equity/automatic housing price appreciation/whatever.

    Current listing price $6.3M (only $1,486 psf).
    Last sale: January 2008 for $4.3M.

    The problem, however, is that I’m not sure about the cost of the current owner’s kids education. How much should I over-bid?

  17. madhaus Says:

    You left out the part where East Palo Alto backs up to the land across the street. That means the soccer field hooligans will visit you first!

  18. SV Shopper Says:

    Shadow inventory in RBA means elusive inventory. The inventory is there, but it’s either not something you want, or it’ll get bid up, snapped up right away.

  19. Petsmart groomer Says:

    > The inventory is there, but it’s either not something you want, or it’ll get bid up, snapped up right away.

    In other words, the inventory is there but you can’t afford it.

  20. SEA Says:

    In other words, the inventory is there but the current owners are delusional about its value.

  21. SV Shopper Says:

    Bottom line to the buyer is that there is little inventory out there.

  22. nomadic Says:

    Little “buyable” inventory. Just like RE has always said. Er, SV Shopper. Sorry puppet poppet.

  23. Sunny(vale) Kim Says:

    SV Shopper must have lost another bid (as he always did). 🙂

  24. madhaus Says:

    That’s terrible! How can one person lose every offer since 2008? Does he not know about overbidding? It’s a wonder anyone can buy a house at all!

  25. Vicki Moore Says:

    Realtard? Wow.

    “Miss Realtor is claiming that few REOs means that shadow inventory doesn’t exist.
    She would have been more honest had she said, look, there’s a gigantic constipated backlog of unavailable inventory in the notice of default –> trustee deed pipeline. So what you see is what there is in the near future.” I don’t know if there’s a constipated backlog – I’m showing what I do know and what I’ve been told. That doesn’t sound dishonest to me. NOD doesn’t mean that they’re going to foreclosure – people pull themselves out of NOD all the time.

    “…she’s both stupid AND dishonest!” Stating my understanding, belief and opinion is neither.

    Next time please leave me out of your degrading each other and rudeness. Want to have a discussion? I’m in.

  26. DreamT Says:

    “I’m showing what I do know and what I’ve been told”

    Face value is indeed the best approach to miss on what’s lurking in the shadows.

  27. vicki Moore Says:

    Good point, DreamT. However, like I said in the evil post, I’m still watching.

  28. madhaus Says:

    Well, Vicki, you certainly have our attention now. Have you taken a little stroll around the site, gotten a feel for the place? Agents with thin skins don’t last long around here. If you have a sense of humor, you might like it.

  29. SEA Says:

    I doubt she’ll make it 168 hours, but maybe she can tell us about the “velocity of ‘buyable’ inventory.”

  30. SEA Says:

    #25 “‘…she’s both stupid AND dishonest!’ Stating my understanding, belief and opinion is neither.”

    Yea, because stating one’s understanding, belief and opinion could never reveal stupidity or dishonesty.

  31. Vicki Moore Says:

    madhaus – No shit. I can see why. I’m not the best at laughing at myself (read “thin skinned”) but I do have a sick sense of humor and can laugh at some pretty gross things. For some odd, strange reason I don’t find being called stupid funny. I will try to see the humor in there – somewhere, I guess.

  32. Vicki Moore Says:

    #30 And calling someone you don’t know or have ever met stupid and dishonest could never be called rude and and obnoxious.

  33. SEA Says:

    Who suggested that your rude and obnoxious comment was off target?

  34. Vicki Moore Says:

    #33 Okay. I have to give you a thumbs up for that one.

  35. madhaus Says:

    Vicki, the only thing gross about this site is some of the photography. I have to admit, I didn’t collect photos of a bunch of filthy toilets like this site did, though. Something to think about, though!

    The rest of the humor comes from the cognitive dissonance between the agents’ relentlessly upbeat listing copy and the sheer crap they’re selling. After all, if the listing was straightforward, the photos acceptable, the price realistic, and the property without obvious defects, we wouldn’t find it worth discussing here.

  36. nancy leonelli Says:

    Did anyone commenting on the shadow inventory question actually READ the article posted????? Sure doesn’t seem like it. !!

  37. nomadic Says:

    Why is that, Nancy? There wasn’t a lot to the article. Sure sounds like the main post covered it, as well as ms in #14. Is it that many of the people posting here don’t agree with your colleague’s assessment that bothers you?

  38. Petsmart groomer Says:

    > SV Shopper must have lost another bid (as he always did).

    I guess his agent must be tired of the foreplay by now.

  39. Vicki Moore Says:

    madhaus: Once in a while I can’t help but post the most ridiculous of pics I find in the MLS. Hadn’t thought of toilets – smell-o-vision would make pictures complete.

    Those who suck drag the rest down. The realtor cry used to be “the market is great!” Give me a break. I’ve walked into plenty of “charmers” and thought who are they kidding?

    It’s really a shame that the National Assoc of Realtors has perpetuated the idea that all realtors are the same. We’re not but I can definitely see how it would seem to be the case.

    nomadic: FYI. Nancy is not a realtor. She’s a long-time client. I was talking to her on the phone today. But since she doesn’t agree with you, I guess her opinion doesn’t count either.

  40. SEA Says:

    Yea, if anyone agrees with Vicki, you’re golden.

  41. madhaus Says:

    Vicki, few people here think all agents are the same. We make fun of the same ones you’re discussing here. I even have a link to a Realtor site (Jim the Realtor) in the Blogroll, because he doesn’t sugar coat bad new or tell clients black is white, debt is wealth, or freedom is slavery.

    Nancy’s opinion counts the same as anyone else’s, but she didn’t support her assertion. I’m not surprised nomadic called her on it.

    I think you’ll find most people here would be interested in some professional insight, but they’re also pretty cynical about NAR buzzwords. That’s why we use them as catchphrases! So, are you a member of the Realtor Party? Is the food any good? How about the music?

  42. nomadic Says:

    Hey, anyone who wants to debate data is welcome here. I didn’t agree with her belief that no one read your blog article. My opinion, not that you asked, is that you took the superficial approach by counting only historic foreclosure sales as shadow inventory. I call it superficial because it doesn’t address NODs or “pent up supply” (admittedly nearly impossible to assess). Now, #4 defended you a bit by pointing out that many (most?) NODs don’t end up in foreclosure. Maybe there isn’t an overhang of inventory waiting to plop onto the market. I actually hope you’re right, being a property owner myself.

    It’s probably when you wrote how “special” it is here that we all rolled our eyes and laughed. (This part: But like a broken record…San Mateo County – The Peninsula – is not like any other real estate market in the country.)

    One last point, you’re correct that “those who suck drag the rest down.” Until NAR raises the bar on who can sell properties, the good ones will suffer unfairly. It’s unfortunate that the ones who suck truly appear to greatly outnumber the ones who might fit the definition of being a professional.

  43. SEA Says:

    Let’s get back to the data, since that’s what Vicki seems to want to do.

    Using Vicki’s data set:

    2009-1st Quarter regular sales: 1,024
    2010-1st Quarter regular sales: 1,146
    2011-1st Quarter regular sales: 206

    Let’s see, same period regular sales are down by 80+%, but let’s celebrate that REO sales are down by a greater percentage.

    I’m not sure what’s included in ‘regular sale,’ but I wonder why regular sales are down by 800+.

  44. vicki Moore Says:

    I’m really not interested in getting back to the data. Ive found the following conversation much more interesting. I’ve learned a lot since I wrote that post in – whatever – March or something. Shadow inventory is much more complicated than I thought at the time and that’s why I haven’t gone back to that line in so many months. I’ve been periodically researching it. I was trying to figure out if the media was blowing it out of proportion or if the SI was real.

    I get the stupidity in saying San Mateo real estate is so different. I’ll quit it with that. Maybe it’s Pollyanna but I dont say it if I thing it’s BS.

    Nancy was trying to be supportive of me. It’s too bad that realtors have made everyone so cynical that you have to believe the only person that would come to my defense would be another realtor.

  45. SEA Says:

    “Want to have a discussion? I’m in (#25).”

    versus

    “I’m really not interested in getting back to the data (#44).”

  46. vicki Moore Says:

    Lol. You want to talk data. I wanted to continue the resulting conversation. I already concede my data was incomplete and thus faulty.

  47. ms Says:

    Hi Vicky.
    Thanks for replying to my post.
    1) Your chart lists REOs and regular sales. Are you including short sales in your “regular sale” category? Why or why not?
    2)Why do you choose not to include delinquencies in your analysis of shadow inventory when even NAR does so(Real Estate Insights, 3/10)?
    3) People do not pull themselves out of NOD “all the time.” Every NOS starts with a NOD. The 328 NOSes filed for Q2 in SMCO probably got their NOD in late ’08, early ’09, triggering loan mod-apps, abortive short-sale attempts with the second fighting the first, postponement of auction sale, cash for keys payout. Of the for-sale signs flapping happily, half are signs of shadow inventory.
    Have you not seen this in the past couple years?

  48. SEA Says:

    “I already concede my data was incomplete and thus faulty.”

    Ok, now that I’ve gotten to know you, can I call you dishonest and ignorant without being called rude and obnoxious.

  49. Vicki Moore Says:

    SEA – No, you may not. I made an error. My understanding of the issue was incomplete. That’s not dishonest or ignorant.

    MS – At the time my understanding was that shadow inventory included simply the inventory that was being held back from banks as to not decimate an already burdened real estate inventory. That did not include short sales or properties that sellers were willing withholding from the market.

    I based my opinion heavily on several things I had read including this article from someone I respect: http://agentgenius.com/real-estate-mortgage-economy/the-shadow-inventory-shadow-gibberish/ and the fact that Wells Fargo announced they weren’t holding any inventory.

    It’s easy for people to sit behind anonymity, throw judgement stones, and jump to conclusions that I’m an idiot. But I’ve put myself out there to make statements, comments, give opinions, whether in error or not – it’s never been in dishonesty or ignorance.

    If you’ve stopped learning that’s too bad for you. I haven’t and will continue to.

  50. madhaus Says:

    Nancy was trying to be supportive of me. It’s too bad that realtors have made everyone so cynical that you have to believe the only person that would come to my defense would be another realtor.

    Accusing people of not reading your article when they not only did read it, they clearly demonstrated a better understanding of the issue than you did (as you eventually concede in #46) is supportive?

    So if your friend says something demonstrably incorrect and dismissive, that’s “supportive.” But anyone calling her on itis “rude and obnoxious.” Calling you on an article that you admit is more complex than the way you covered it is “rude and obnoxious.”

    Mr. Spock is not impressed.

    Do I have that right?

  51. SEA Says:

    This we agree: “It’s easy for people to sit behind anonymity, throw judgement stones, and jump to conclusions that I’m an idiot.”

    “judgement stones?”

    I won’t say you were the easiest, but who’s going to dispute easy?

  52. SEA Says:

    Ok, Vicki, let’s continue this friendly discussion:

    In your blog entry, here, you carefully define East Palo Alto as “Definitely sellers’ market. There’s more houses under contract than there are for sale.”

    Let’s review a few of those under contract homes:

    My quick search of pending homes from redfin suggested there is about 48 East Palo Alto homes pending. Let’s review a few of those…

    Address, last sale date, last sale amount, current list, difference.
    2085 ADDISON Ave 6/20/2007 786000 280000 -506000
    1007 BRADLEY Way 4/28/2006 765000 319000 -446000
    2542 BAYLOR St 2/1/2007 652000 220000 -432000
    2351 RALMAR Ave 2/24/2005 620000 210000 -410000
    1047 ALBERNI St 6/1/2007 660000 257600 -402400
    833 GREEN St 6/30/2004 750000 365000 -385000
    1060 WEEKS St 12/28/2005 844000 460000 -384000
    1531 KAVANAUGH Dr 9/29/2006 620000 250000 -370000
    2208 POPLAR Ave 1/18/2007 600000 249000 -351000
    1155 LAUREL Ave 9/28/2006 650000 300000 -350000
    2280 GLEN Way 11/16/2004 475000 149000 -326000
    6 SPARROW Ct 5/21/2004 625000 300000 -325000
    1614 PURDUE Ave 3/3/2005 505000 219750 -285250
    123 ABELIA Way 12/30/2004 523000 242000 -281000
    933 OAKES St 8/24/2005 755000 499000 -256000
    455 WISTERIA Dr 11/5/2003 445000 199000 -246000
    2526 ANNAPOLIS St 12/15/2004 410000 179900 -230100
    Undisclosed 10/13/2006 450000 250000 -200000
    913 WILKS St 9/6/2006 742500 549000 -193500
    2330 UNIVERSITY Ave #340 3/31/2006 376000 185000 -191000
    1232 CAMELLIA Dr 4/13/2004 420000 234000 -186000
    2627 FORDHAM St 12/21/2007 383000 199000 -184000
    2287 CAPITOL Ave 5/28/2004 500000 324500 -175500
    470 GARDEN St 9/7/2005 380000 209000 -171000
    2445 GLORIA Way 3/4/2002 400000 230000 -170000

    If we sum the difference between former sale price and current asking price, the total losses, assuming a full asking price sale, would be $7.5M on these 25 homes, for an average loss of about $300k.

    Quick computations will show that the aggregate former selling prices is $14.3M, and thus, the current asking prices, of this carefully selected sample of 25, is over 50%. Sure there are a few homes that sold over a decade ago with higher asking prices than purchase prices.

    This is not what I’d call a sellers’ market, even if there are more homes under contact than active.

  53. SEA Says:

    #50- It’s perfectly fine to outline your opinion, if your name is Vicki, as outlined in #25, “Stating my understanding, belief and opinion is neither [stupid NOR dishonest].”

    But if I want to state my believe and opinion, as in #48, that’s not fair, as suggested in #49.

    What’s comical, however, is the redefinition of English:

    Vicki’s claim: “My understanding of the issue was incomplete. That’s not dishonest or ignorant.”

    definition of ignorant: “resulting from or showing lack of knowledge or intelligence” m-w.com

    Also REALTORs are supposedly professionals in the industry. Is it too much to suggest that REALTORs making poorly founded claims are dishonest?

  54. DreamT Says:

    SEA, maybe she’s an American and therefore used to presume that a word never means what it’s supposed to mean.

  55. SEA Says:

    “When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean—neither more nor less.”

  56. madhaus Says:

    Hey, Vicki Moore returned the favor. Burbed and its denizens have been slammed on her site here.

    She doesn’t seem to understand why I quoted Upton Sinclair. Come on back, Vicki, and I’ll explain it for free.

    We’re not Jersey Shore, though (note, not a plural). We’re more Mystery Science Theater 3000, with the overly clever sniping.

    Thanks for the link!

  57. DreamT Says:

    It’s very kind of Vicki to assist in increasing Burbed’s SEO ranking, even though she inaccurately claims that she was censored (her comments were not edited nor removed).
    I tend to generally err on the side of the Realtors™, but in this instance I must admit that she comes with a dose of intellectual dishonesty.

  58. nomadic Says:

    Anyone care to pralay links to the Realtor posts we’ve welcomed here in the past? She certainly wasn’t kidding when she said she was thin-skinned.

    I do wonder what she hopes to accomplish by drawing attention to this thread on her blog. Seems it would have been far more to her advantage to remove the trackback on her “pig” post.

    (Her insistence on adding the second “e” to judgment keeps bugging me too.) lol

  59. madhaus Says:

    Here’s a Realtor who was not attacked at all, Greg Fielding. I disagreed with two of his columns too! He was pretty gracious about it.

    Mary Pope-Handy got ticked off at me too, after also getting it wrong.

    Oh and then there’s there’s Wende by the Bay who agrees with the need for honest Realtors!

  60. madhaus Says:

    DreamT, I don’t think it’s intellectual dishonesty at all. Vicki reminds me of other people I know like that, who perceive everything through their emotions and feel loyalty trumps facts. In interpersonal terms, this is the Amiable personality rejecting the Analytical (who values truth above all).

    Thus the comment from her friend is supportive (even though it goes on the attack and has no factual content whatsoever), while the original column by MS and the follow-ups are “rude and obnoxious” because they have the nerve to call out her (admittedly sloppy) work.

    I think she genuinely believes what she said, but she’s welcome to explain herself anytime, here or on her own site. And I think she put the link on her site to here because she honestly thinks anyone who reads her blog would rally to her support despite her Shadow Inventory column having errors.

    Too bad she hasn’t checked in today. That toilet photo was just for her!

  61. SEA Says:

    For your enjoyment:

    http://sanmateorealestateblog.com/stuff/righteous/

  62. SEA Says:

    What about that “gigantic constipated backlog of unavailable inventory in the notice of default –> trustee deed pipeline?”

    599 days?

    via CR:

    “The July Mortgage Monitor report released by Lender Processing Services, Inc. (NYSE: LPS) shows that foreclosure timelines continue their steady upward trend, as a payment has not been made on the average loan in foreclosure in a record 599 days.”

    Source

  63. Vicki Moore Says:

    I wish I had time to respond to everything; I’m sure the fuel would be appreciated. If I was that thin skinned I wouldn’t have come back repeatedly for more abuse.

    I said in my post I was censored?

    Have you tried to buy anything in EPA lately? I’m simply talking about inventory numbers; not sale prices, values.

    I guess when all else fails critique the spelling and grammar. Boy, I wish I had time to go back and do that.

    Psychoanalysis? Really?

    I don’t take issue with MS bringing a goof I made to everyone’s attention. What I have issue with is the defamatory, rude and inconsiderate name calling.

    “Hey, anyone who wants to debate data is welcome here?” Uhh, I beg to differ on that one.

  64. Vicki Moore Says:

    #57 I didn’t claim my comments were edited or removed.

    I said you guys don’t follow the guidelines established here, which are above the comment box. Look ^^^^^^^^^^^

  65. DreamT Says:

    Vicki, you wrote “(Comments may be edited/removed without notice.) I guess that’s only when it works for them.”

    In any case, posters are not punished for not following guidelines, except in (very rare) blatant, very mean instances. Your tantrum seems to be caused by the language used by one or two posters (#8), yet you directed it at the entire site. Burbed is not your Re/Max company, and people don’t get “fired” for being uncivilized. Take issue with moderation if you wish, instead of antagonizing all contributors…

    However, defamatory? You were called ignorant and dishonest. Both assertions were backed rather logically. You could have calmly proved that you know what you’re talking about. Crying wolf won’t earn you brownie points. And being “nice” is no substitute for being competent.

  66. SEA Says:

    #65- I’m guessing she’s requesting to be the mod. She’ll clean up the riffraff.

  67. Vicki Moore Says:

    I pointed out that you were incorrect and now I’m throwing a tantrum and antagonizing all contributors.

    Name calling is not used in an intelligently articulated argument.

    Being wrong in one post is incompetent? Wow.

  68. nomadic Says:

    This discussion is pointless. Do the regulars miss RE or something? Somehow DreamT’s comment (And being “nice” is no substitute for being competent) has now been interpreted as calling our new visitor incompetent. Pointless to respond for someone who’s on the defensive.

    Hmm, so why did I write this?

  69. SEA Says:

    We agree again: “Name calling is not used in an intelligently articulated argument.”

    Why not simply post an intelligently articulated argument?

  70. DreamT Says:

    Vicki, I wish you the best. I’m sure you’re a very nice and competent person in real life – you’re successful and have satisfied clients. The internet prism does not do you justice, and maybe you’re tired.

  71. madhaus Says:

    We agree again: “Name calling is not used in an intelligently articulated argument.”

    Why not simply post an intelligently articulated argument?

    #69, because that would require acting as a Lover of Truth and Data Facts rather than a Lover of Agreement and Support and Loyalty. And that’s fine, because it takes all types. But it’s not a good idea to open a bottle of whine and get all cheesed off about it. There were any number of much better ways to handle this. Storming into the joint and smashing chairs over peoples’ heads, slapping up a GIT ‘EM sign on your front door, insisting that your friend’s particularly ill-advised actions were a good thing… definitely doing it wrong. Don’t you want Mr. Spock to be impressed for once?

    Remember, Vicki, sense of humor. There’s plenty to be found. Put that whine back in the fridge to chill it a bit, go look at the links to the crappy house photos I just added, or enjoy cruising through the San Mateo listings of old.

    Seriously, dear, you’re going to HAVE to do something about that flash-frying technique your temper is having on all the hors d’oeuvres. And wouldn’t you rather stick around and laugh at our resident troll (who seems to be otherwise occupied) than turn into a replacement for him?

  72. SEA Says:

    “Lover of Agreement and Support and Loyalty”

    I don’t suggest we use the color blue.

  73. madhaus Says:

    Actually, that personality type is exactly the color blue.

  74. Real Estater Says:

    Vicki,

    You can’t argue with these morons. They wouldn’t be morons if they can be reasoned with. Of course, it’s your fault if you don’t agree with them, because you don’t have a sense of humor. Name calling, personal attack, baiting etc. is not OK if you do it. It’s called a tantrum, and pretty soon they’ll start censoring comments. Been there, done that. That’s why I don’t post anymore.

  75. SEA Says:

    The foreclosure pipeline, defined as “90+ Delinquencies and Foreclosures divided by the 6 month average of Foreclosure sales is 693 months (over 57 years) in New York and 621 Months (over 51 years) in New Jersey!”

    Source

  76. Sunny(vale) Kim Says:

    That’s why I don’t post anymore.
    —-

    Please post. We need your leadership. 🙂

  77. Sam_Adu Says:

    Does this flamewar count as “burbed and perturbed”?

  78. SEA Says:

    That $535M invested in the Bay Area? Dead and gone!

    Good thing the value is in the land.

  79. DreamT Says:

    Employees used the money to pay down their mortgage and defend Fremont against the invading hordes of suitcases full of cash.

  80. madhaus Says:

    Take a look at Redfin’s August blog entry. This is what they have to say about this thread’s topic of Shadow Inventory!

    Shadow Inventory Is Probably Smaller Than Most People Think

    So now we see the banks sending delinquent homeowners one notice of default after another without ever actually foreclosing. This tells us that the shadow inventory that has taken on titanic proportions in the popular imagination is smaller than most pundits claim. And the regular human beings we talk to about listing their home for sale are often now deciding to wait a year for better prices too.

    We don’t see the market getting swamped with new inventory while prices are low, but we do think that all the would-be sellers will jump into the game once demand strengthens, preventing prices from rising much either. This is why we think prices will stay low for a long time, but not drop significantly further. We’re on the bottom and that’s where we’ll stay.

    You hear that? Redfin is saying

    1. Vicki is right, and
    2. They’re calling bottom! But to be fair, this is at the national, not the Bay Area level, so everyone say it with me!

    USELESS AGGREGATE DATA!!!!!!

  81. madhaus Says:

    btw #78 explains why #74 doesn’t post anymore.”

  82. MS Says:

    “So now we see the banks sending delinquent homeowners one notice of default after another without ever actually foreclosing.”
    Therefore, where does the inventory now sit? The shadow knows.
    And the regular human beings we talk to about listing their home for sale are often now deciding to wait a year for better prices too.”
    Hm. Banks do that too.
    All that pent-up hope for higher prices reminds me of “toilet watch” on MSNBC Lockup. People can hold out for only so long.

  83. Petsmart groomer Says:

    > People can hold out for only so long.

    SV Shopper proves you wrong.

  84. nomadic Says:

    But he’s just a “shopper.” Always a shopper and never a buyer!

  85. madhaus Says:

    I hope you all saw today’s article on drhousingbubble on, you guessed it, SHADOW INVENTORY!

    http://www.doctorhousingbubble.com/shadow-inventory-armageddon-foreclosure-timeline-up-to-an-average-of-599-days-foreclosures-reos/

    The biggest problem facing the housing market is still the large amount of stubborn shadow inventory. The fact that this figure remains elevated is a sign that the banking system after all these years and trillions of dollars in bailouts has yet to figure out a streamlined way to unload properties. The Federal Reserve is trying to grease the wheels with historically low mortgage rates but that has done very little since this does not address the weak economy. At the latest count there are 6.54 million loans that are either delinquent or in the foreclosure process. This figure hasn’t really moved much for the entire year. Properties have been sold from the REO (bank owned) pile but this is the tiny chunk of properties that is covered by the mainstream news and also that appear in public listing services. As we will show in charts later in this article, only examining this piece of the real estate pool is like seeing the tip of an iceberg and thinking there is nothing underneath it submerged in the water.

  86. MS Says:

    In some ways, Real Estater/SV Shopper and Vicki have it right. SFR inventory in the $400K – $500 K range is about six houses at any given time. This assumes the houses are
    1) really for sale;
    2) not with $50K or more in repairs off the bat;
    3) not one block or less from Caltrain tracks or 101; 4) and is really a house, not a condo.

    941 S. Norfolk was one. 1841 Peck was another. These were both 2/1s that sold for over asking within a week (mid to high 400K). Finding a nice rental with a LL without issues is even more difficult than finding a house that’s not trashed and really for sale.

  87. MS Says:

    Hey Madhaus,
    For an intro that included “it really doesn’t matter what we run on Saturday and Sunday,” I would say this piece did pretty good for filler.
    It beats “what to do on the Peninsula.”
    I loved your Spock/toilet picture, by the way. I’ve seen that house somewhere in 94063.

  88. Real Estater Says:

    Holy shit! PG&E gas leak in Cupertino. If it can happen to one house, it can happen to other houses in the area, as all the pipes are probably around the same age.

  89. SEA Says:

    MS- Given the downward trend in prices, I’d suggest it’s not that buyers are willing and able to pay more, but rather, sellers are seeking to sell sooner rather than later/never.

    Will buyers be both willing and able to pay more in the future? What are buyers expectations regarding future income?

  90. SEA Says:

    #88- Did the owner know how to use Drano?

  91. * Says:

    TheRealExcreter said: “Been there, done that. That’s why I don’t post anymore.”

    I thought it was because of the bajillion thumbs down to 1 thumbs up (which you give mastabatorily yourself every post).

  92. madhaus Says:

    MS, I must admit I’m surprised this thread took off. Sometimes I think a particular article will resonate and it gets 3 comments, two of them by the same person and one by me.

    RE, that was actually an important story. Why are you burying it on a six-day-old thread, especially when today’s house has Cupertino Schools! And that location is right on the Cupertino/Sunnyvale border, too.

  93. vicki Moore Says:

    I’m baaaaack. Did y’all miss me?

  94. madhaus Says:

    Welcome back, Vicki, but this thread is pretty much done. Feel free to join us in a current one. You can dis my rant about API scores and school testing that ran yesterday if you’d like.

    Or maybe you have some uuuuuuuugly house photos to share in Saturday’s thread? (Would be great if you did because nobody else shared.)


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