….I love our monthly market report for our region. They do such a valiant effort (As do I, mostly) of putting a good shine on.

This month they touted that the numbers were up from February to March! Big jump!…Until you look a bit closer and see that the numbers are down, year over year by 40%. Ouch.

While our closed sales YTD are tracking last years, you can see another potential for slowdown in the pending numbers, and the inventory numbers. It evolves by the day, and one good sunny day could have a big impact.

This should drop the inventory (It has) and stiffen the market (it has…kind of) but this month we are seeing quite the flood of properties on the market, so my inventory crash was quite short lived…..It turns out, you can’t score if you don’t play, so look for lots of people to have a ticket in that game, but listing homes that are essentially unsellable due to indebtedness. Our trends are very choppy, and clearly divided into the two markets, Those that have to, and those than can. We are running about the same as the national markets, with 40% of our transactions being defined as “short.”

Last month, I incorrectly identified that the market has two “ends” higher, and lower, and that the higher was made up of those that can…I want to clarify that there are examples of both types all over the market price ranges, and that this is leading to a really choppy presentation of properties in the market…..and the dreaded resets.

…And speaking of resets, just as the demand firms up, the appraisals from a bunch of foreclosures are hitting valuations. We are having a HECK of a time making negotiated value. Seems a lot more people want to live here than the appraisers think….

So, we continue bouncing along the bottom. We are having a big push of sales get in the pipe right now, so that seems positive, but the big news will be how that carries into the Summer, and especially, the Fall.

There are a couple of great updates on the blog over at Copperwest, too. In the index of the blog are a couple of links to pages that are “mini-searches” of sub markets in the gorge. They have the 10 newest properties, AND the ten largest price reductions. Kinda cool.

Next month, apparently, we are going to launch a mobile app too…..ooh pretty.

See you then. And have a great Spring, such as it were……

Oh, oh, so late, late late….Springtime is always such a hustle, especially when we’ve just had one of the coldest, and wettest (is that a word?) March on record.

Maybe that isn’t the best thing for a Broker to say, but with averages being what they are, we are in for an awesome Spring….once it gets started. Though I have to say, I’ve been paddle boarding a bunch recently (call me for free lessons everyone, I’m geared up!) and it’s quite the all season sport. A lovely gem if the trails are wet, the mountain is raining, and there’s no wind…..

Oh yes, Hood River Real Estate. Big, lumbering things happening. You don’t notice them if you aren’t staring at it, but these last few months are witnessing a fundamental shift in our markets, and Real Estate in general. If you had told me in November that we would be talking about dismantling Fannie and Freddie in March….well, I think I would have taken that bet, and lost.

Now, I think that ultimately that might be a good thing, but that’s in the long, long term. It’s the near to mid-term that’s going to hurt, as Government Sponsored Entities (GSE’s) retreat, but the replacement market only caters to something called the Qualified Residential Mortgage (QRM) market. (A QRM is a mortgage that qualifies as having a borrower and a property that are of a certain level of quality such that the entire mortgage may be sold off on the secondary market, thereby allowing the Lender to lend more. A non qualified mortgage (whatever that is, they are still arguing over the definition) would require the originator retain 5% of the loan amount to keep “skin in the game” (whatever that means. All it really means is that the whole game gets a lot stricter.)) Wow, double parentheses. It’s a nested Real Estate opinion. Things must be getting strange.

Copperwest, however has been moving quickly and quietly along, and doing quite well, though it still feels tough. For a brief moment there last week, I believe, we were the largest, by volume, agency in the entire Gorge. I’m certain we didn’t hold that title for long, (we only have five agents, including me) but one title we do constantly retain is the highest volume per agent. When you have the fewest agents of any office in the Gorge, and you are the largest by volume….well, you do the math.

We’ve been tweaking our compensation schedule too. I think I can say, with a really high degree of probability, that our office support, training and compensation schedule are the best in this region. (We have technology credits, and Celilo food cards as part of our package. I mean really……) And now I’d like to grow a bit, so we are out in the market, while some are retreating, looking for more brokers who want to out-produce the rest of the marketplace by a factor of two or more.

Oh right, Real Estate. While I was gushing there, things continue to change, and I have to say, the access to financing will severely impact Buyers in the market. There are many of them out there, but the gap is still quite wide in attempting to do a deal. Deals are getting done, though and the inventory in the City of Hood River is in decline, which will lead to an even more acute pricing strain this Summer.

Meanwhile, in the Dalles, the inventory is exploding. I think this too, shall pass, once the pricing gets down due to the glut.

The Hood River market could very well cleave in two. Sellers who can afford it, will list at the price they are motivated at which will be, in some cases 30% high. Buyers will remain indignant, but have nothing but extremely modest choices to choose from within their restricted ranges. (self imposed, restrictions, mostly)

So where does that leave us? An intense reliance on insider knowledge, and a stagnant market.

Our brokers are already working every single angle possible to get deals done. Private financing, Owner carry, asset swaps, you name it. We are deeply committed to making things happen, and trying to never take no for an answer. I think you are going to see a lot more of that, not less. It’s entirely possible (and this is happening now) that a team of people need to come to a transaction to work it. Short sale negotiator, mitigation and repair expert, financial expert, all in the form of one or more Realtors. It’s just getting more complicated, not less……………

See you next month!

2011 Starts out with a……well it started anyway. The market is reawakening, and although my inventory crash isn’t showing up in the numbers, I’m getting really tired of showing the same properties over and over and over again.

“Do you have any more properties?” “unfortunately, no.” …..”Well in Portland, there would be five or six versions of this same property. Are you sure?” “Yes, I’m sure. Part of a “small town” feel, is a small town set of homes. In town, they are kind of challenging to come by…..”

And so it goes. I have to say, however, there are there a ton of showings going on, but very little offering….It’s seems that could change at any second though.

We seem to be having this issue this currently (It came to a head in a couple of things we are working on) that the majority of the transactions in the last few months have been “pressure sales” as in, foreclosure, imminent divorce, or other reason to have to sell the house, short or otherwise. Word from one of the appraisers is, roughly, like this….”We are now in the situation with banks that they want the most current (as in last 30 days) comparable sale. There are now enough pressure sales in this market, that we can’t excuse them off anymore, they HAVE to be a part of the valuations…”

Ooouch.

In the meantime, quality inventory is becoming hard to come by, because everyone is in “underwater lockdown” (That’s for you Jim, I know you love that phrase) so no one wants to sell. Further, the appraisals are now trailing the upward pressure due to scarcity…..It sets us up to promote a properties value, against empirical models that are now valuing distressed sales, in a town that many nationwide database models see as a statistical error.

It is, however, one of the finest places to live in the United States, with water, food, resource and recreation, but the inability to get traditional valuation to care.
We are clearing the same “trails” we have cleared before, we used to walk it daily, unimpeded. We validate the same arguments of value for our clients, making sure that this market doesn’t accidentally implode as collateral damage from someone’s greed in exactly four other markets, Florida, Arizona Nevada and California.

We’ve built so much new technology in the last decade, yet we cannot, for all that, accurately quantify (and collateralize) a compact rural existence. Our valuation models in the country don’t consider anything but large cities, and it is exactly at this point, when Rural and “small distributed” are at their most valuable, but least understood. (BTW the Community Reinvestment Act originally addressed this issue, and did a great job. Currently it’s seen as the cause of the subprime meltdown. I disagree.)

Wow, And I sat down thinking this was going to be a light one this month…. Please ponder for a month, and feel free to comment, especially if you disagree…..
See you next month. The Wind is just around the corner, and my diet and I are looking forward to leaving a few pounds out on the water…..