Ah, Christmas time.  The toys, the food, the eggnog, the family visits, the decorations, the lights, and of course, the tree.  We wanted to find a simple ornament with a house for sale representation to wish you all a Happy Holiday, but instead, we found the ornament at right.

Amazing, isn’t it?

Now, we will be the first to admit that there are indeed excellent and knowledgeable real estate agents out there.  This blog acknowledges that there would be fewer people buying and selling homes if all of them were completely incompetent.  But this blog more importantly notes that it’s the bottom percentiles of the “profession” that help keep us in top material.

Now, if you have a Special Agent who you think would appreciate these thoughts on their tree, we swear we did not make this up.  You can actually buy this round ceramic ornament at CafePress.  And it will cost you $12.50.  Plus shipping!  And you can also get it in red ink (perfect for the foreclosure specialist).

Being the inquisitive, fun-loving bunch that we are, we decided to see if this ornament could be, well, improved.  Took us a while, and since none of us went to design school, it didn’t have the panache or the braggadocio of the simple ornament above.  But ours has something better.  A logo.

A completely derivative yet 100% protected-from-trademark-infringement-lawsuits-by-the-fact-that-it’s-obviously-satirical-and-would-not-induce-confusion-in-anyone-other-than-a-Realtard logo.

We wish you and yours a very Wonderful Winter Whatever.

Last year, when we wished everyone the best wishes of the Season, we suggested you buy a house for some of your loved ones.  Looks like somebody took us seriously.

Look at the last bullet on the flyer:

Some home buyers purchase homes as gifts.  Hmmm, maybe by “some” they mean “I read this on a Real Estate website.  Therefore, somebody somewhere out there must have actually purchased a home as a gift.  Given that my income is about five percent of what it was in 2005, I will suggest almost anything to increase it in hopes that there is at least one suggestible person out there sitting on carloads of cash.”

Well, sure, this is a Bay Area real estate website, and we did indeed suggest buying a homes as a gift.  Whether these agents understood we were using the literary technique of humorous exaggeration to make a point is one of life’s eternal mysteries.

This is an Open Thread.  How many houses are you planning to purchase as gifts?  Are they all in the Real Bay Area?

Whatever traditions you and your family celebrate, we wish you peace, and joy, and happiness, and low interest rates, and RBA home prices doubling every ten years like they’re supposed to.

So, what gifts did you get that you loved, or loathed, or what did you give to your loved ones?  Or best of all, what did you want that you didn’t get, so you’re going to buy it for yourself when the stores re-open?

Did anyone get a house?  And if you did, was it one of the featured DEALS on Burbed?

And if you didn’t get a house for the holidays, it’s not too late.  We’ll be starting up our after-Christmas Clearance Sale on Monday, because the bank said everything must go!

Merry Christmas everyone!

Here’s my gift! An article from 2006! Enjoy!

Nightmare Mortgages
Risks or not, the accounting treatment is boosting reported profits sharply. At Santa Monica (Calif.)-based FirstFed Financial Corp. (FED ), “deferred interest” — what an outsider might call phantom income — made up 67% of second-quarter pretax profits. FirstFed did not respond to requests for comment. At Oakland (Calif.)-based Golden West Financial Corp. (GDW ), which has been selling option ARMs for two decades, deferred interest made up about 59.6% of the bank’s earnings in the first half of 2006. “It’s not the loan that’s the problem,” says Herbert M. Sandler, CEO of World Savings Bank, parent of Golden West. “The problem is with the quality of the underwriting.”

In the middle of one of the hottest U.S. markets, Coral Gables (Fla.)-based BankUnited Financial Corp. (BKUNA ) posted a $14.8 million loss for the quarter ended June, 2005. Yet it reported record profits of $23.8 million for the quarter ended in June of this year — $20.9 million of which was earned in deferred interest. Some 92% of its new loans were option ARMs. Humberto L. Lopez, chief financial officer, insists the bank underwrites carefully. “The option ARMs have gotten a bit of a raised eyebrow because we generate and book noncash earnings. But…it’s our money, and we do feel comfortable we’ll get it back.”

Even the loans that blow up can be hidden with fancy bookkeeping. David Hendler of New York-based CreditSights, a bond research shop, predicts that banks in coming quarters will increasingly move weak loans into so-called held-for-sale accounts. There the loans will sit, sequestered from the rest of the portfolio, until they’re sold to collection agencies or to investors. In the latter case, a transaction on an ailing loan registers on the books as a trading loss, gets mixed up with other trading activities and — presto! — it vanishes from shareholders’ sight. “There are a lot of ways to camouflage the actual experience,” says Hendler.

…

To get the deals done, banks have turned increasingly to unregulated mortgage brokers, who now account for 80% of all mortgage originations, double what it was 10 years ago, according to the National Association of Mortgage Brokers. In 2004 banks began offering fatter sales commissions on option ARMs to encourage brokers to push them, says Gail McKenzie, assistant U.S. attorney in Atlanta, who is investigating mortgage brokers for improper practices.

The problem, of course, is that many brokers care more about commissions than customers. They use aggressive sales tactics, harping on the minimum payment on an option ARM and neglecting to mention the future implications. Some even imply verbally that temporary teaser rates of 1% to 2% are permanent, even though the fine print says otherwise. It’s easy to confuse borrowers with option ARM numbers. A recent Federal Reserve study showed that one in four homeowners is mystified by basic adjustable-rate loans. Add multiple payment options into the mix, and the mortgage game can be utterly baffling.

Billy and Carolyn Shaw are among the growing ranks of borrowers who have taken out loans they say they didn’t understand. The retired couple from the Salinas (Calif.) area needed to tap about $50,000 in equity from their $385,000 home to cover mounting expenses. Billy, 66, a retired mechanic, has diabetes. Carolyn, 61, has been caring for her grandchildren, 10-year-old twins, since her daughter’s death in 2000. The Shaws have a fixed income of $3,000 a month that will fall by about $1,000 in November after Billy’s disability benefits run out. Their new loan’s minimum payment of about $1,413 is manageable so far, but the fully amortized amount of about $3,329 is out of the question. In a little over a year, they’ve added some $8,500 to their loan balance and now face a big reset if they continue to pay only the minimum. “We didn’t totally understand what was taking place,” says Carolyn. “You have to pay attention. We didn’t, and we’re really stuck here.” The Shaws’ lender, Golden West, says it routinely calls customers to ask them if they are happy and understand their mortgage loan.

…

Analyst Frederick Cannon of Keefe Bruyette & Woods says most banks don’t apologize for their option ARM businesses. “Almost without exception everyone says [the option ARM] is a great loan, it’s plenty regulated, and don’t bug us,” he says. In an April letter to regulators, Cindy Manzettie, chief credit officer for Fifth Third Bank in Cincinnati, said it’s not the “lender’s responsibility to help the consumer determine the appropriate payment option each month…. Paternalistic regulations that underestimate the intelligence of the American public do not work.”

There’s plenty more to read. What a great gift!

Merry Christmas! I hope Santa delivered you the mortgage bailout federally guided assistance that you asked for!

I’m sure you’re feasting today, so I’m going to be lazy and reprint the post from Thanksgiving. Have a great day!

Last year I had the ultimate Thanksgiving Price Shootout on this blog: Using safeway.com’s website, I compared the prices of a hypothetical Thanksgiving shopping list between the Bay Area and Seattle/Redmond area.

Also known as “Zune vs iPod, Wii vs PS3″ since Sony/Apple are either based in, or have significant operations in the Bay Area, versus Nintendo and Microsoft which are in Seattle/Redmond. I guess I could’ve also called it Google vs Microsoft, but that seems so cliche.

Anyhoo, here are the prices for this year! Again, I compared prices of the exact same item in the Bay Area vs Seattle/Redmond. I also tried my best to pick items without coupon deals (the only exception was stuffing – crazy sale on stuffing right now!). Also, if you compare to last year, the prices won’t match – in part because I may have picked different brands/items last year. For example, this year I went for Roma tomatoes – I think last year I picked beefsteak tomatoes.

That said, it’s the same general list otherwise. Here we go!

Difference: Bay Area is 16% more expensive

(BTW, I’ll never understand why milk is so much more expensive here…)

This is pretty disappointing frankly. Last year the difference was 20%. This means either that Seattle/Redmond has gotten more expensive, or the Bay Area has gotten cheaper.

At this rate, the prices might be the same – that would be a disaster! Would high housing prices, and a 9.3% state income tax (that keeps our roads in fantastic condition) be enough to keep the Bay Area as special as it is?

Of course if you leave the the Bay Area, you’ll find that they don’t have any Chinese restaurants, Korean restaurants, Japanese restaurants, Thai restaurants, Vietnamese restaurants, gays, smart people, guacamole, tech companies, snow sports, hiking, mountains, liberals, In-n-outs, or 9 months of sun. And let’s not forget our cheap housing, amazing public schools, great roads, low taxes, and lack of traffic.

Here’s to hoping that 2008 will be more expensive!

Happy Thanksgiving!

Merry Christmas everyone! Did you get that special pack of ramen from your mortgage broker that you’ve wanted all year long? Did he splurge and give you a can of Fancy Feast instead?

Since it’s a holiday, I’m going to recycle this post from Thanksgiving – since it probably still applies.
How to save 20% on your groceries for Thanksgiving

The other title for this entry is “Zune vs iPod, Wii vs PS3, Safeway vs Safeway”. Why?

iPods are made by Apple, which is in Cupertino. PS3s are made by Sony which has a big site in North San Jose. Bay Area companies.

Zunes on the other hand are made by Microsoft in Redmond, WA. Coincidentally, Wii’s are made by Nintendo – which is also in Redmond, WA!

But these places have one thing in common: Safeway. So thanks to a reader, I thought I’d investigate to see what the difference between the Safeways are. Here’s a table comparing the prices of common Thanksgiving items:

First, we’ll start with a turkey…

Here’s a turkey in Nintendo/Microsoft land:

… and the same turkey in Sony/Apple land:

Here’s some milk in Nintendo/Microsoft land:

… and the same turkey in Sony/Apple land:

Average difference: 20% more expensive

(Just to be clear – these were the exact same products on both sides. Same brand, same quality, same count – everything. You can verify the results easily using Safeway.com)

So now you know why the PS3 and iPod are so expensive, compared to the Wii and the Zune. Because the groceries are more expensive too.
Want to save money on your groceries? Easy! Leave the Bay Area for some place that’s not special like Seattle metro area.

Of course if you leave the the Bay Area, you’ll find that they don’t have any Chinese restaurants, Korean restaurants, Japanese restaurants, Thai restaurants, Vietnamese restaurants, gays, smart people, guacamole, tech companies, snow sports, hiking, mountains, liberals, In-n-outs, or 9 months of sun. And let’s not forget our cheap housing, amazing public schools, great roads, low taxes, and lack of traffic.

Yeah. I didn’t think you’d leave. It’s just too special here.

Happy Thanksgiving!  Merry Christmas!