[Matrix Zeppelin Series] Sticky, Herd Mentality, Media Not Distorting, Acceptance of Risk, Smell Like Cabbage, Fear of Music, Price is Key and 75 Laminated Signs
Posted by Jonathan J. Miller -Friday, September 29, 2006, 7:38 AM
Throwing caution to carny barkers walking the plank, here’s a few notable comments from the Matrix Zeppelin:
I find it interesting that people expect housing prices to â€œcrash,â€ yet they are unwilling to see the value of their own home as dropping. Real estate prices are sticky-downward, because we price our homes based on our expectations and desires, not newspaper reports.
media coverage, if its not accurate, can help exagerate the highs and the lows of a market. I am not blaming the media at all, its just that I think there is a tremendous herd mentality out there right now.
the â€œherdâ€ is finally waking up to the reality that housing prices must revert to the mean…the media is not distorting the issue; they are merely taking a hard look (for the first time in many years) at the fundamentals of real estate. and the fundamentals are overwhelmingly negative.
Sort of along the lines of what you are saying, I know my own perception has changed, over the past several years. Three years ago, when I bought my first condo, I wanted as much home as possible, so I got an adjustable rate 1st loan and interest only 2nd loan. This time around, in May, I was steadfast against getting an ARM, for either. The rates were just a bit higher for the 1st, and a lot higher for the second, but I didnâ€™t want to take any chances. Bottom line? My acceptance of risk had been reduced, because of the uncertain housing market. Others, especially those who canâ€™t afford to take out a fixed-rate mortgage loan at 8% instead of 5% (our 2nd loan rate) will have no choice but wait it out.
I find the best blogs at â€œcarnivalsâ€ also tend to find carnies. Small hands. Smell like cabbage.
I am in Hoboken and itâ€™s a sea of â€œFor Saleâ€ signs, whether on the street or attached to buildings. But I grew up in a town that banned them. I guess it is supposed to provide owners with a sense of security, but frankly, if you really want to sell, I think itâ€™s pretty decent advertising.
Hereâ€™s another one from Coldwell Banker that claims it will help me â€œFind myself a city to live in.â€ (If youâ€™ve also got Fear of Music and â€˜77 in your collection, youâ€™re all set as far as Iâ€™m concerned.)
I have come to a similar conclusion concerning refinancings, but do you think that it will really have an effect on homebuyer mentality? I think that even if rates drop a little, sales will still be down and inventory up, because at this point price is key, and until that comes down, nothing will move. After all, interest rates have been low and falling all summer and it hasnâ€™t helped at all. But that was just my own thought.
I know this comment is a little late, but did you hear what Barbara Corcoran had to say today on Good Morning America? She is trying to demonstrate how to sell your home in 7 days and amongst some good ideas she stated: 1) Blanket your area with â€œFor Saleâ€ signs. Corcoran made 75 laminated signs at Kinkoâ€™s for a total cost of $324. Make your signs bright and clear. Bright yellow is the most memorable color. Use clear, big, black lettering so people can read it easily. 2) Corcoran also made up car magnets and a giant billboard in front of the house. 3) The Freundsâ€™ [the sellers] friend owns a ski shop on the major interstate in town, so Corcoran hung a nine-foot banner across the front of the shop. Seventy-five signs, one billboard and a nine-foot banner. Yikes!!! No doubt that Town Board will have a very lively meeting the next time they get together.