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You Know, I Don’t Want To Sound Like It Was The Worst Idea Of My Life, But…

A report from the Washington Post. “Bidding wars, which terrify buyers and spark joy for sellers, have practically disappeared in many of the formerly most competitive markets, according to a new report by Redfin. Nationwide, just 13 percent of offers written by Redfin agents on behalf of their clients in January faced competition, which followed a record-low number of bidding wars in December. The January number represents a dramatic drop from the year before, when 53 percent of Redfin buyers faced competition for their offers.”

“In the Washington area, 10 percent of buyers faced competition in January. While that’s a bit above December’s 7 percent, it’s a big drop from the 48 percent of offers that faced competition in January 2018.”

“The biggest decline in bidding wars was in San Francisco, which dropped from 82 percent of offers facing competition in 2018 to 18 percent in 2019. Los Angeles and Seattle had the next biggest drops.”

The Las Vegas Sun in Nevada. “For February, the median going rate for an existing home in the Las Vegas area — as recorded through the association’s multiple listing service — was $296,200.”

“‘Our home prices have been going up faster over the past year than almost anywhere else in the country, but they’ve been slowing down lately,’ said Janet Carpenter, the 2019 president of the association. ‘This is consistent with what’s happening nationally. We’re also following national trends with our increasing housing supply and the decreasing number of homes being sold here.'”

“She said some sellers have been lowering their listing prices. In fact, the February GLVAR report showed more than 7,000 homes listed without any type of offer. That’s up more than 95 percent from early 2018.”

From KTVZ on Oregon. “Bend’s median home sale price dropped sharply from record territory in February, but Redmond’s market kept on reaching new heights, a report shows. Redmond-based Beacon Appraisal’s analysis of home-sale data found that Bend, which soared to a record $450,000 median sale price in January, had dropped $23,000 to $427,000 in February, as the number of sales fell to just over 100.”

The Los Angeles Times in California. ” The price of Jenny Craig’s beachfront abode in Del Mar just got a bit thinner. After asking $39.5 million for the home five years ago, the weight-loss guru has trimmed it to $27.9 million.”

From Mansion Global on New York. “A quirky modern compound stretching along 300 feet of ocean in Montauk, New York, has sold for $18.1 million—a spot of good news for the otherwise sleepy Hamptons luxury housing market.”

“A popular place for wealthy New Yorkers to buy second homes, the Hamptons have felt the reverberations of a depressed housing market in the Big Apple. The number of luxury sales in the Hamptons in 2018 declined 13.2% compared to 2017, and sellers are having to slash listing prices. The average luxury home sold at a whopping 20% discount in 2018, according to appraisal firm Miller Samuel for brokerage Douglas Elliman.”

From My Northwest. “Thirty-seven-year-old Marissa Sullivan bought her first house two years ago in Portland. ‘You know, I don’t want to sound like it was the worst idea of my life, but…'”

“But, she definitely has regrets. And so do a lot of her peers. A new study by Bankrate.com says nearly two-thirds of millennials (23 to 38 year olds) regret buying a home. That’s more than any other age group. ‘Learning how to say no to brunch, learning how to say no to vacations, that’s definitely where the regret kicks in,’ said Sullivan. ‘Which was something I didn’t have to do before because my rent was so cheap. I’d been able to live a fun lifestyle.'”

“A total of 12 percent of people said they regret buying such a small home, and 8 percent say they picked a bad neighborhood. Seattle’s Jamie Deadmond, 36, regrets moving so close to Highway 99. ‘We get a lot of homeless people jumping our fence,’ said Deadmond. ‘We’ve actually had three people try to break in when I had a brand new baby in the house.'”

“Also, 79 percent of people surveyed for this study consider buying a home to be the epitome of achieving the so-called ‘American Dream.’ Deadmond admits she got a little wrapped up in getting to the next stage of adulthood. ‘It was definitely the next step in our lives together. We thought we needed to buy a house if we were going to be in Seattle, especially if the rents were rising like they were. And it just felt like this sense of urgency.'”

“Sullivan felt similarly. ‘Maybe I let ego get in the way a little bit, like, I’m old enough to own something, this is something I should do. Almost like it looks good on paper, you know? I probably wasn’t quite ready but I have been making it work. But it’s not without a lot of stress.'”

“Sullivan has made it work by renting out her spare bedrooms on Airbnb. But after one too many negative experiences and feeling isolated in the part of town she chose to buy in, she made a big change. ‘I didn’t tell you this yet but I actually moved out of my house and I’m Airbnb’ing the whole house, full time, because I’ve had these regrets and these struggles with trying to staying afloat and to have some sort of social life,’ Sullivan said. ‘So that’s sort of the newest chapter in this home owning.'”

“And through her regret, Marissa acknowledges that the equity will eventually be worth it. ‘I know it won’t be this hard forever and it’s only year two and year one of owning a home is definitely the hardest year,’ said Sullivan. ‘Everybody says that. And then you start seeing the market go up and everything starts making sense. Because I know it’s going to pay off. Just because I regret it right now and it’s really hard, I haven’t had a lot of hardship in my life so maybe it’s good for me. But it doesn’t stop me from having regrets.'”

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  1. ‘I know it won’t be this hard forever and it’s only year two and year one of owning a home is definitely the hardest year…Everybody says that. And then you start seeing the market go up and everything starts making sense. Because I know it’s going to pay off. Just because I regret it right now and it’s really hard, I haven’t had a lot of hardship in my life so maybe it’s good for me. But it doesn’t stop me from having regrets.’

    Prices in Portland are sinking like a turd in a well Marissa.

    But it proves a point. A lot of these STR toilet scrubbers are speculators.

      2. That was the first thing I thought when I read “millennial” and “Portland” in the same paragraph.

        Be like Kaightlynne and roll with it 🙁

      1. Agree. It doesn’t matter if the “market goes up,” if she can’t make the payments. Unless she wants to hop on the serial refi train.

    4. There are lots of Airbnb speculators out there to be sure. It’s kind of a last ditch effort. One of my guests today stayed at Home2 by Hilton and spent $150/night and they came to my apartment for 1/2 the price. They are retired and own 2 homes, one in Chicago and the other in Wisconsin. I don’t see the Airbnb thing going away, but there will be a glut at some point and some people who have cost structures that can’t support their rental rates will get shaken down.

        1. Yes, this is the primary purpose. When a large complex opens there is typically a ramp up phase that can take a period of time. Typically this is 1 year, sometimes longer in markets where the price is very high or demand is low. I launched 5 short-term rentals during our lease-up period and they were an instant success, so I did 10 more. Now we are essentially at full occupancy, so the decision to wind them down or keep a few in the pool (175 in phase 1) is a discussion we are having with the owners and investors.

          One thing that I have learned is that there is an art to buying furnishings, staging the unit, and writing catchy descriptions. If you do it right you can command a premium in the short-term rental market. I’m probably just an average decorator and I’ve kind of taught myself the ins and outs of hospitality these past few months. But there is a huge market for short-term rentals. I have lots of people who need to rent a place for 1, 2, or 3 months but who not interested in a 6-12 month lease. Airbnb/VRBO/HomeAway can fill this need very well in my opinion.

  3. ‘She said some sellers have been lowering their listing prices. In fact, the February GLVAR report showed more than 7,000 homes listed without any type of offer. That’s up more than 95 percent from early 2018’

    Oh dear…

    1. As a potential buyer in Las Vegas, that news from the GLVAR is great news for me. 😀

      1. BTW, I thought the Raiders move to Las Vegas was going to keep the housing market going strong! At least that’s what several people are around town told me.

        1. Properties are listing in Lake Las Vegas again and nothing is selling. They are way overpriced and yet there are tons of developers out there building new homes. To me, it still looks like a ghost town out there and I wonder if Lake Las Vegas will ever really take off, especially now that the market is making a nose dive again. I hear Las Vegans talking about how we have already been hit so hard that the rise in prices is not the same as elsewhere. I personally believe that there is another bubble, even in Las Vegas, and we just aren’t on the radar like we were in bubble one. Perhaps we are one of the cities where the denial is stronger because we are not written about as much as other cities in the news? It seems like the big elephant continues to be unnoticed in the room. Any comments out there about the future of Las Vegas (Summerlin in particular) and Lake Las Vegas?

          1. There is also a lot more noise this time. The Raiders coming to town and the exodus of rich Californian locusts moving to LV means this time is different. The problem is LV is all about discretion spending and recession will be bad for that. So unless wages double or triple, there is no way prices can be supported. And the longer the industry deny this fact, the more they will keep building….at some point, this fact will be undeniable. I don’t think we are there yet. Maybe late this year or early next year.

          3. Yes, there is all that noise about the Raiders coming to town – I agree! I remember all of the inventory and ghost towns back in 2009-2011 up in summerlin and lake las vegas. It seems like it is happening again. How are they charging $600,000 – $900,000 for these homes that are springing up across the valley? And they are labeling them luxury homes because they look somewhat different than the typical tan stucco ones that are everywhere in Vegas like the Truman Show.

    2. If you type Las Vegas into realtor.com and hit enter, you get a sea of red dots. It looks like there is one house for sale for every city block. And the majority of them look empty if you open a few listings and look at the pictures. Can any of the Vegas people give a perspective on how this compares to the last bubble? Is there any way out of this without an implosion of prices and an explosion in foreclosures?

  4. Bidding wars, which terrify buyers and spark joy for sellers, have practically disappeared in many of the formerly most competitive markets, according to a new report by Redfin.

    That’s going to make it harder for realtors to lie to their “clients” (marks) about supposedly competing bids.

    1. Well I went to an open house a few months ago in DC suburbs. The broker actually told me to hold off for a couple of years if I could. She and her realtor friends were all seeing a slowdown and the belief was in 2019 – 2020 things were going to get worse. So they’re not all bad!

  5. Regret$, struggle$, stre$$es, … just follow the yellow brick$ road, it leads to the Cele$tial Citie$ of your choice!

    “Ignorance goes through life hoping for the best. He believes a good life is enough to enter heaven and tells Christian and Hopeful that their path to the Cele$tial City is unnece$$arily long and difficult. He knows of an ea$ier route. Christian tells Hopeful in a whisper that he considers Ignorance a fool.” … Pilgrim’$ Progre$$

  7. “Also, 79 percent of people surveyed for this study consider buying a home to be the epitome of achieving the so-called ‘American Dream.’

    Never understood how the idea of owning your own home got perverted into a lifetime of debt serfdom as the proles’ purchasing power is relentlessly eroded by the Fed and its debauchery of the currency.

    1. “Never understood how the idea of owning your own home got perverted into a lifetime of debt serfdom …”

      Think of this as success (I certainly do).

      Think: 1. Dumb ’em down.

      And then think: 2. Profit.

      If you “never understood how the idea of owning your own home got perverted into a lifetime of debt serfdom” then you haven’t been sufficiently dumbed down.

      1. If “79 percent of people surveyed for this study consider buying a home to be the epitome of achieving the so-called ‘American Dream.’” then 79 percent of people surveyed for this study will be competing with each other to achieve this so-called ‘American Dream’ and thus PRICES WILL REFLECT THIS.

        1. As for me, achieving the “American Dream” is defined by quietly watching as multitudes of totally dumbed-down ignorant pukes willingly and eagerly march into my bank and willingly, eagerly, and ignorantly sign their names on a few dotted lines which commits themselves to send to me huge chunks of their hard-earned money each and every month for DECADES.

          Pukes work, Mr. Banker gets to hang out at the beach. God’s Plan.

          1. Ignorant pukes THINK they are clever and smart because the money they borrow and use to bid up prices BELONGS TO SOMEBODY ELSE while Mr. Banker KNOWS he is clever and smart FOR THE EXACT SAME REASON.

            Bahahahahahahahahahahahahahahahahahahaha.

          2. To me, the epitome of the American dream is control of one’s time. The ability to do what you want without severe negative consequences is immensely powerful. I would never want to be a slave to a mortgage.

          3. I would never want to be a slave

            Hope you are paying cash for that vanity car you ordered.

      2. Market$ to the mark$:
        x2 income $ignatures qualifie$ you for “purcha$e price loan”

        1. @BlueSkye

          Yes, paying cash. I didn’t ride an eBike for 2 years for nothing! The decision to buy a $53k Tesla wasn’t difficult for me. We purchased a new Honda Civic LX in 2010 for $17k. I calculate that in the past 9 years we have spent about $10k in gas and about $5k in other repairs and maintenance. Our true cost of owning our Civic will be about $32k, perhaps more. I plan on owning this model 3 for 20 years and I save about $1k-$2k in fuel per year at current prices. Plus, I just want that car because I have a long highway commute (4 hrs) when I drive from So. Utah to Salt Lake City. There are a couple of things I will spend money on: nice running shoes, a great restaurant, and an electric car. This is just what I personally value.

          1. A Utah head of household living rent-free at two locations buys a $53K “Built Tent Tough” “Made in California for Californians” virtue-signaling Model 3 Tesla as the company is in “perpetual rolling bankruptcy” and expects the car to last 20 years. That is ironic, delusional and f’d up! Harsh but true.

          2. expects the car to last 20 years

            It’ll be interesting to see how the whole car holds up. But in general I do expect electric drivetrains to hold up much better than traditional.

    2. It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. – Henry Ford

      1. “It is well enough that people of the nation do not understand our banking and monetary system” for if they did they would refuse to play the stupid game set up for them by strangers and thus wonderful people such as myself would be forced into seeking real jobs.

      2. @CarlMorris

        I have been following the EV battery performance of a Dutch-Belgium consortium of about 350 owners. The consensus is a 10% decrease in battery range by 185k miles. If you Google Tesloop and see some of the Teslas in their fleet, they have over 400k miles under warranty. I think it is reasonable to expect a battery replacement at about 300k miles, but I don’t think it is unrealistic to expect an electric drivetrain to go 500,000 miles, maybe a million. My civic has 132k miles and still runs pretty well and I would expect 300k from it. I think EVs are probably double the longevity.

        https://insideevs.com/highest-mileage-tesla-now-has-over-420000-miles/

    3. Here’s the current kicker for the younglings… rising rents. 2008 did a little something to make them feel like paying the bank on a mortgage is not necessarily always better than paying a landlord… but the “adulting means buying “ meme is more compelling as a directive if you throw in the silly levels that rents have gotten to all over the place recently. The only new rentals seem to be luxury and/or fake-money college student and/or senior assisted living, and despite people like my own city’s council members claiming that increased number of units will bring down prices it often has not at all— the obscene 1200 to 2000 dollars *a bed* rates of the downtown/campus area has made landlords of aging stock in the outskirts feel like they can raise their own rates by double digits a year and still seem a bargain by comparison. The greed of landlords is a significant factor I think in keeping this craziness paying it forward— and with AirBnB after all everybody gets to be a lanlord of sorts . There’s a resignation to the greed this time compared to the exhuberance of 2008, at least among us little people just trying to decide whether to pay sky high rents that everyone seems to ask without apology or excuse, or pay sky high house prices.

      1. The greed of landlords is a significant factor I think in keeping this craziness paying it forward

        Landlords have always and will always try to maximize their income. Unless they are all in collusion to artificially restrict the availability of rental housing I don’t think they are the root of the problem.

      2. Buy vs. rent, it is a binary option though. Where is the “none of the above” option? You either become a) homeless b) live in your parents basement c) live in your car or d) live in an RV.

        Until the population stops growing and spare capacity for McMansions start renting out individual rooms, rent rates will have pressure. Supply vs demand is still in effect, and unless builders actually provide affordable housing, there is no competition to drive down luxury.

        1. You either become a) homeless

          It’s not binary, it’s a mania. The choice is not between a 4,000 ft2 make me rich house and a luxury apartment only.

          1. Agreed Blue. But for some reason the structure of production seems bent on producing houses that are way overpriced or luxury condos/apartments. I think builders are only building “make me rich” homes and “luxury”. I don’t see very much affordable/workforce housing coming online. Every politician is talking about “the missing middle” for good reason.

  9. Another athlete house not selling. Short story but very entertaining. When he bought this house in 2007, at the time it was the most expensive transaction in the county for the year, $4.5 million.

    “Vinny Testaverde would really, really like to sell his house.

    After two years on the market with no takers, the nearly 13,000-square-foot home of the former Tampa Bay Buccaneers quarterback is headed to auction on April 9.

    ‘Properties in this price point can sometimes be stubborn to move,’ agent Evan Pedone said of the house on Lake Keystone, now priced at $6 million. ‘The idea behind these auctions is that it creates a sense of interest and a sense of urgency.’

    …

    ‘We’ll be in tuxedos and have a harpist there,’ said American Heritage owner Michael Peters. ‘We’re going to turn the headache of selling the home into an elegant event.'”

    https://www.tampabay.com/business/vinny-testaverde-cant-sell-his-lakefront-florida-home-so-its-now-going-to-auction-20190305/

    1. “Situated on more than five lakefront acres, the house has six bedrooms, seven full bathrooms, four half baths, two full kitchens and a 10-car garage. There is a theater that can comfortably seat up to 15, full size basketball and tennis courts, a golf-simulation room,a walk-in wine cellar with cigar humidor, a game room, a card room, a piano room and a gym “the size of an Anytime Fitness club,” Pedone said.”

      Check.

      “But with the other daughter soon to be married and their son away at college (he’s a quarterback for the University at Albany), they decided it’s too big for them.”

      Bahahahaha … so a house with six bedrooms, seven full bathrooms, four half baths, two full kitchens and a 10-car garage, a theater that can comfortably seat up to 15, full size basketball and tennis courts, a golf-simulation room,a walk-in wine cellar with cigar humidor, a game room, a card room, a piano room and a gym “the size of an Anytime Fitness club,” the house will suddenly be too big for him because the other daughter soon to be married and their son will be away at college.

      Got it.

      1. I agree with you, although I’ve heard it said that mega-celebrity athletes, actors, etc., often bring their family, social, and entertainment activities under their own roofs, because they can’t go out in public without being swarmed or photographed or gawked at. Don’t think Testaverde ever fell into that category, though. Certainly not here; it’s been 27 years since he played for the Buccaneers.

  10. “Sullivan has made it work by renting out her spare bedrooms on Airbnb”

    Side-hustling to make ends meet? I guess none of them are maxing out the 401K to get the company match. You know who is really going to be screwed? GenZ who are now in high school. They are going to be footing the bill when it’s time for the giant Millenial generation to retire.

    2. The Boomers and Xers are not in much better shape. Something like 50 percent of Boomers have less than $10,000 saved for retirement. Before anyone starts shaking their Hurrycane at the young folks, it’s just like that anti drug commercial from the 80’s:

      Dad: “Your Mom found all of these bills in your room. Where did you get all of this debt”?

      Kid: “YOU DAD! I learned it by watching you”!

    3. You know who is really going to be screwed? GenZ who are now in high school. They are going to be footing the bill when it’s time for the giant Millenial generation to retire.

      My son is a HS Senior this year. Gen X feels their pain.

    4. She was never saving in the first place. Her regrets are having to say no to brunch and vacation trips.

      1. I max out my 401k and still go to brunch and take trips.. and still have money left over at the end of the month. What I don’t have is an overpriced mortgage.

  11. The two biggest sources of regret that I’m expecting are :

    1) Overpaying, and then watching the market turn. When buyers were overpaying, but prices were still shooting up after they purchased, they found lots of ways to feel good and justify it. As price reductions are becoming the norm and transaction prices on comps sinks, they can visualize a flashing neon sign saying “Idiot, you overpaid by $XXX,XXX” where it’s like the national debt billboard – the number keeps getting bigger as you stand there.

    2) Not buying a house that they actually really wanted in the first place. A couple years back I remember talking with people who were trying to buy, but losing out on everything due to the bidding wars, so they kept just bidding on anything that came in their price range and hoping they ‘just get something’ (exact quote from a lady who rented the house above me). When the mania dies down, they realize they made a huge life-altering commitment to and are stuck with something they didn’t really want that much in the first place.

    3. Ah, the poetry, the music …

      “When the mania dies down, they realize they made a huge life-altering commitment to and are stuck with something they didn’t really want that much in the first place.”

      … all made possible by using money that they did not have.

      Why, it’s a financial miracle!

      😁

    4. That’s where my hubby is— just wanting to get something because he hates the idea of renting anymore. People be like that, and realtors so often encourage it of course.

  13. “it just felt like this sense of urgency”

    You played, you lost.

    Enjoy the attempted burglaries with that new baby in the house, looser.

    2. And probably the local news if it even exists doesn’t report mere attempted burglary! My local news hardly covers all sorts of crime, the citizens try to get info but we’ve had real estate lawyer mayors for decades and marketing consultants up the wazoo running the city. AA MI just got demoted one spot on niche.com list of best places to live in America! We had been at no 1 for a couple years! All while having toxic water and the worst roads literally in the nation and obscene property taxes lol. Realtors will fail to mention the poisoned drinking water that just got even more poisonous, the train noise problem in high value areas that’s so bad people are stamping their well heeled feet about it lol, the increasing crime and traffic and on and on. It’s just easy to get burned without *deep* research sometimes…

  16. “The biggest decline in bidding wars was in San Francisco, which dropped from 82 percent of offers facing competition in 2018 to 18 percent in 2019. Los Angeles and Seattle had the next biggest drops.”

    Next up: Massive increase in foreclosure auctions…

    1. Indeed, I’ll be looking for those headlines here soon.
      Chindian infestors are nowhere to be found now, and inventory is skyrocketing as the remaining bag holders scurry to get out from under these soon to be rapidly depreciating assets.

      While I’d like to see the return of 20% down-payments and decent credit scores, and the demis of “rocket-type” mortgage approvals, I doubt the PTB will ever let it happen. We’ll be on the hook for yet more bailouts soon, I’m sure.

  17. “whopping 20% discount”

    20% is not what I would consider whopping. That’s just the starting point of negotiations. 40-50%, now we’re talking. The entitlement of these pukes…

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