New year, same difference

Letters From the Home Front

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Luxury Connect | Oct. 16-18 | Beverly Hills

I am not a big fan of the numbered lists, but this time of year they seem to be requisite — much like using a shopping cart as a weapon of mass destruction in order to secure better positioning in the checkout line is a seasonal requirement if one is to properly display that old holiday spirit.

So lest I be labeled a killjoy — a Grinch even — I offer my top 10 real estate market predictions for 2010. Actually, I offer 11. I’m going rogue.

1. All of your seller clients think real estate prices have bottomed and are now climbing faster than Sir Edmund Hillary on amphetamines.

Meanwhile, all of your buyer clients think the market will hit the earth’s core sometime this year (Oct. 2), at which point they will be able to use their Veterans Affairs benefits to purchase acreage in Telluride, Colo. — or put a downpayment on the White House. Until then, they want to see a dozen homes every Saturday just for fun.

2. Bank of America will find my client’s short-sale package in May. They will lose it again in August.

3. Congress passes HR 3044, placing into effect an 18-month moratorium on the Home Valuation Code of Conduct. But Congress also passes HR 3126, which kills the HVCC dead for good. A last-minute amendment to HR 3126 is unfortunately revealed, which establishes new oversight requirements for appraisers to ensure their complete and indisputable independence.

All appraisers are granted Canadian citizenship. More importantly, all appraisals must now be performed using the Randomized Valuation Method (RVM) in which the appraiser is required to record his odometer reading each time he stops to ask directions to the property and then average or add the numbers to arrive at an opinion of value (his choice).

Appraisal reviews will be performed by committees of three to comply with the new rock-paper-scissors final approval requirements. The review committees may convene no sooner than one day prior to your scheduled closing to ensure that no one ever really knows what the hell is going on with the loan.

4. Distressed sales continue to set the tone of the market, and flipping is again all the rage. New, stricter lending guidelines for Federal Housing Administration-insured loans, together with the 90-day rule, will mean that only people with at least cab fare can now buy homes.

Congress will pass new homebuyer-incentive legislation offering a free toaster to anyone who closes escrow before Labor Day. For closings occurring on a Wednesday, they will throw in Bank of America’s "Music While on Hold" CD boxed set, a compilation of easy-listening tunes (performed by various artists) that I have been enjoying since February. My favorite is the upbeat classic "Your Business is Very Important to Us."

5. The president announces the government’s latest bailout plan involving the Treasury Department’s takeover of McDonald’s. To boost consumer confidence and put the happy back in the housing market, homeowners with toxic loans are given free, extremely happy Happy Meals that include a toy — a drooling Bank of America action figure.

Treasure maps identifying the relative location of my short-sale package to the Delta Quadrant are sold separately. Proclaiming that this new program will not cost the taxpayers anything, the president increases the price of a Quarter Pounder with cheese to $7 trillion to offset administrative expenses. …CONTINUED

6. The National Association of Realtors unveils a new designation designed to further underscore the agent’s value proposition. However, the "I’m an Expert at Everything because I Paid for this Course and Say So" accreditation is quickly scrapped because it lacks the requisite snappy acronym.

It is replaced with the "Delivering Unmatched Marketing by Applying Social Strategery" designation and, by mid-June, thousands of agents are officially calling themselves … well, isn’t it obvious?

7. The Treasury Department’s supplement to the Making Home Affordable program, directives intended to standardize and accelerate the short-sale process, is declared a raging success as it is reported that the one homeowner who actually qualified for the program (a really nice man in Idaho named Bob) was able to compromise his credit and lose his home relatively quickly.

Bank of America gets the nod and delivers; unable to find his file, they just use someone else’s file and call it even.

8. The road to market recovery is littered with speed bumps as many of the government programs that have been artificially fueling demand come to an end. These include the homebuyer tax credits, the Fed’s Fannie Mae and Freddie Mac mortgage purchase program, and the "Instant Winner Loan Docs" stimulus game.

9. Successful agents will be the ones who can out-read, out-research, and out-Google their clients. They will also be the ones who can most quickly build their own shelter and find the immunity idol. Mostly, though, successful agents will be the ones who can help their clients make sense of all the disconnected information.

This is no small task since, while successful agents are out meeting the termite guy, their clients are downloading the latest iPhone application from: YouKnowMoreThanYourAgentAndDontLetThatDumDumTellYouOtherwise.com.

10. The market will continue to be, for lack of a better word, mixed. Lower-priced properties will continue to draw bigger crowds than Tiger Woods on Ladies’ Night, while mid-priced and higher-end properties will start to feel the hangover from 2005 in greater numbers.

Unless an agent has an REO (bank-owned property) gig, listings are harder to come by and representing buyers will require levels of knowledge, tenacity and patience like we have never experienced. Despite this, approximately 12 million new licensees will enter the field in 2010, and each one will enthusiastically attend their broker’s training on how to pass out pumpkins on Thanksgiving and register a Twitter account.

11. Tens of thousands of savvy investors, sensing opportunity, begin buying Happy Meal bank-negotiator action figures on eBay. They repaint them, add granite countertops, and resell them to hungry end-users who, sensing opportunity, are convinced that the market has bottomed and now is a great time to buy.

To 2009, here’s looking at you. I fear we will be seeing more of you in 2010.

Kris Berg is broker-owner of San Diego Castles Realty. She also writes a consumer-focused real estate blog, The San Diego Home Blog.

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