Hood River Real Estate and Columbia Gorge Real Estate

I think the most telling item in this months market highlights is the caption under the Summary chart. It reads; “Due to the vast difference between the counties in the mid-columbia region, the area propert on page 15 provides summary information on each individial county”

Which is another way of saying……”there’s some dogs in there, look out!”

The First Cut
At First cut, things look pretty rough. 14% decrease in new listings, Closed sales down…..ready for this? 46.4% and Pendings down 34%. For the quarter, Pendings doen 31.5% and closed ar 30.9%

See the upward tick?

The Finer Measure
Lets look closer at the Hood River County. Overall in Hood River County, Pending Sales were down 5.9% in March, and 26% for the Quarter. (Big uptick) Interestingly, while the other numbers look similar (bad, but not doing horribly) there is an interesting note……and that is that 9 of the 12 closings in March, and 23 of the 34 closings this year to date, are all in downtown Hood River. That looks like a flight to “quality” to me. (Quality being defined in a defensive aspect, like, safety, or value)
Around the region this thought seems to play out in this first quarter. Most of the outlying areas got absolutely pounded. Some of it is seasonal, but if this trend continues, it could hurt the outlying areas alot this year. Shorthand? If you want to live Rural, make an offer.

Ever heard the one about the mortgage broker who blew the financing so that they wouldn’t have to honor the lock?

Or how about the one where the lender went bankrupt at closing?

….Or, how about the one where the bank approved the loan, then pulled back at the very last minute, while the parties were sitting in the closing, waiting for documents to be e-mailed in?

Yes, these, and other horror stories are making their way around the offices these days. while some of them will surely become urban legends, we have been noticing an uptick in alternative mortgage strategies. Here’s a list of a few of them. (These are actually, very very similar to pre-1998 best practices, BTW, for people who can remember Real Estate from back then.)

1. Find a co-signor. This one is a classic, and becomming back in demand. By co-signing with a family member (usually parents) a young buyer gets to get the credit score of a sibling or parent, and then makes the payment. This was a very common arrangement in years past, and we are seeing it come back.

2. Private Money. Sound Exotic? hardly. It isn’t exactly at the bargain basement prices of some mortgages, but you’d be surprised how many people are out there looking to lend money against a Real Estate Asset. Be careful when doing private money deals, because things like remedy, and evidence of payment, etc. can all hurt you alot. Best to get a lawyer to help out, but once everyone is on the same page…..well, these things tend to work out pretty well.

3. Your local bank! Yes, your local bank used to be the only lender in this area, and it is looking like a return to that time is a-comin. get to know your bank manager better. You know how you used to complain about not ever being able to speak to a human at those large mortgage companies, well, now you can speak to a human, only problem is, that human now knows alot about you, so you’d better make sure your payments are current!

So it’s been tough. Last couple of months have been quiet, and the newspaper hasn’t helped. I left for vacation a few weeks ago and I didn’t want to look at our income statements until I returned, expecting to see red, flowing from the pages……

I returned, and got up the nerve to look at my numbers and compare them with last year, bracing for the worst and…………

They were EXACTLY the same as last year. Sales are up, closings are exactly the same, and while my costs are a little high…..really, alot better than I had thought!

I’ll have to admit, I was expecting so, so much worse! Mostly, I was really bummed about my call that there was a bottom a few months back. I really do sense it, and I think that while we will be dragging along the bottom for a fairly long time. Most models indicate that the bulk of the mortgage resets, etc aren’t until june, but with all this intervention, I think the worst of it has passed. (and been shifted back to the public in general, including those of us who weren’t profligate borrowers, but that’s for another posting)

For those of you who are waiting for the bottom to fall out, let me say this, you missed it. If the bottom does fall out at this point, you most certainly wont be buying anything, because most likely, you wont be able to obtain any kind of financing. Short of a major disaster (now under 20% and falling, thank you very much) in this marketplace, or the total implosion of Real Estate lending in it’s entirety, we are past it.

That said, it’s going to be rough rough rough for a bunch of years………

See you next month!