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Old 02-13-2009, 02:59 PM
 
Location: State of Being
35,885 posts, read 67,016,830 times
Reputation: 22370

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Quote:
Originally Posted by XcapefromNJ View Post
Yes, the housing market is bad and probably getting worse, but I think we have figured out (sorry, I can't bear to read 4 pages of drivel. I did see that sullyman picked up pretty quickly on the problem with the graphed "statistics")

that graph does not mean that people are listing homes for $310,000 and then selling them for $190,00. At least I think it does not. More likely it tells you that higher priced homes are not selling, while lower priced homes are selling. You have to compare listing price vs selling price of the same homes, although I realize that is also a statistic that is messed with greatly, by relisting at ever lower prices and then calculating the percent of list using the last listing price.

Perhaps it will not be "GOOD TIME TO BY A HOME" from an investment point of view ever again. Personally, I prefer owning to renting. I like being able to do what I want inside my house, improving, painting, and I don't like the threat of having my home sold out from under me as happened to me in my first rental apartment many years ago. It seems disingenuous to me (although I would prefer to just use the word "retarded") to post a misleading graph in an attempt to persuade people not to buy a home.
I liked your use of the word disingenuous myself, and think it fits very well.

I am right w/ you on your reasons for wanting to own your own space.

 
Old 02-13-2009, 03:00 PM
 
7,104 posts, read 9,698,581 times
Reputation: 2564
Quote:
Originally Posted by DavidMar View Post
Wow. How many Realtors have posted in this thread? 20? If you're a realtor or a mortgage broker or a banker, please write that before you post - obviously that means that you are subject to a huge bias. Reminds me of a quote:
"It's impossible to get a man to believe something when his job depends on him not believing it."

The data are what they are, and they are as clear as day.

5-7 months ago I posted but I couldn't remember my login. The Graphs I posted then will look just like the one I posted in this thread.

1st BIG misconception - a house is a horrible investment. Historically, houses yield, maybe, 1-2%.

Houses are money pits - insurance, taxes, fix up, improvements, and on and on.

The best reason to buy a house is because you want to own the land and house and have complete control over them.

With regard to where we are now, I'm not sure why a simple line graph has various posters arguing that the data or chart are misleading.

As noted already, the data comes from Realtors.

Folks, it's a simple line graph showing average sales price. What the graph shows is that the average sales price has fallen off dramatically in the last 5 months and is now below a several year minimum.

What's arguable about that? Nothing.

You can try to argue that prices are doing great in some subcomponent. OK.

Show me.

If you are going to try to argue that some portion of Charlotte is not heading down, then simply post the data for everyone to see. Like I did.

"All boats fall with the sinking tide."

The other trend line is asking price at time of new listing.

Once again, I'm not sure how the data could be simpler or more easily understood.

The line shows that average asking price has been going up for quite some time, and is hugely above the average sales price.

Clearly, that's a huge problem. You can offer whatever interpretation you want. I offered mine.

Home prices are going to continue to fall.

I am not a Realtor. I'm not involved in real estate. I will not make a dime whether you buy or not.

But here's my advice:
If you're thinking about buying a home in Charlotte (or virtually anywhere else in America), wait a year, minimum, and, better yet, wait at least 3 years.

Prices will continue to fall. Unemployment is skyrocketing, the depression is worsening, and the American consumer is tapped out. If you rent for 2 years and the market falls 20%, then you just saved 40,000 dollars on the purchase of a 200,000 home. Figure, with the interest you pay, you can save almost 100,000 by simply waiting 2 years.

Prices will continue to fall. Hard.

I'll post again over the coming months (saving the log on this time!!) to update my chart.

No, I've never been banned. I don't get personal. People don't like the data, they can insult me all they want.

But the data are very easy to understand and very clear.
I wasn't going to respond to this thread until I starting thinking about what might keep me up all night. This will, trying to figure out this guy's M.O.

This post he did here must have taken and hour and half to type but he says he can't remember how to log-in.BUT he remembers that he warned everybody not to buy so now he's back to claim his trophy.
Gettting your log-in information sent to you by CD takes about 1 minute of your time. Believe me I did it sitting under a palm tree in a third world country that only has electricity 7 hours a day. So this doesn't make sense.

He's not selling houses, that's pretty clear.
So, what's the real deal here? Let me ask OP. OP what do you get out of this thread and your display of charts, long winded posts, and all this carrying on.
Please try and respond by 9:30 PM as I'm tired and want to go to bed early. Don't want to toss and turn all nite long thinking about you. I want to think about those 8 days left to 86 degree weather.
TIA
Sleepless in NY
 
Old 02-13-2009, 03:19 PM
 
Location: Ayrsley
4,714 posts, read 8,457,827 times
Reputation: 3814
Quote:
Originally Posted by DavidMar View Post
Once again, I'm not sure how the data could be simpler or more easily understood.
The problem is that the data is too simple. If I understand what you are posting, the comparison is between average asking prices and average sale prices at each time point with no other qualifications or statistical controls. A more accurate graph would not take the average asking price across the board and compare it with an average sales price across the board as aggregate numbers. To do so is a poor, and somewhat inaccurate, statistical approach.

A more accurate representation would be to look at every individual sale in a given time period, calculate the difference between the asking price and sales price for every individual home and present the data as the relative, average difference between asking and sales prices. And present some standard deviations and medians too.

You need to control for price points. For example, lets say houses are selling for about 10% less than their listing price - That means people asking $100k were getting $90k, people asking $200k were getting $180k - and people asking $500k were getting $450k. If you have 15 houses for sale at a given point in time, 5 each at those three asking and selling price points, your graph (as you calculated it) would show an average difference between listing price and sales price of $26,666.66. But for people with the $100k and $200k homes, that is an inflated amount, but the way in which you presented your data would suggest that anyone listing their house could expect to sell it for ~ $26,700 less than they were asking for it.

That is just one of many ways the data can be misinterpreted. It could be the opposite, lower end homes are losing more and higher end homes are losing less. I'm not a realtor, I don't know the trends.

Another example - You also need to control for outliers. Say there are 5 houses for sale at a given point - 4 sell for $5000 less than the asking price. One sells for $20k less than the asking price. using an overall average, it looks houses are selling for $8 less than their asking price on average, when that is not really the case - that overall figure is being artificially inflated because one properly lost a lot of money compared to the rest (for whatever reason) but its obviously not representative.

And what about controls for the actual asking prices? Maybe some homeowners are listing highly inflated prices (possibly more than the house really is worth). Say the fair market value for my house is $250k, but I'm going to list it at $275k hoping that I might find a buyer willing to pay that much - or at least give me the full fair market value after negotiation because I gave them room to maneuver down without hurting my bottom line. In the end, I sell for $240k - is that $35k difference meaningful in any way? No, because, had I listed for a realistic price of $250k, I'd show that it sold for $10k less than asking instead of $35k.

Quote:
Originally Posted by DavidMar View Post
Home prices are going to continue to fall.
True enough - at least in the immediate future. But no one can say how far or how long until that trend changes. And Charlotte never had a bubble like the northeast, so the drop here will never be as drastic as in some parts of the country.

Quote:
Originally Posted by DavidMar View Post
But here's my advice:
If you're thinking about buying a home in Charlotte (or virtually anywhere else in America), wait a year, minimum, and, better yet, wait at least 3 years.
And, as with your statistical analyses, this blanket statement is woefully oversimplified and controls for no other variables and, hence, is not very useful.

Quote:
Originally Posted by DavidMar View Post
I'll post again over the coming months (saving the log on this time!!) to update my chart.
In between postings, may I suggest purchasing a statistics textbook.

Quote:
Originally Posted by DavidMar View Post
But the data are very easy to understand and very clear.
And the data you presented may have face validity, but that's about it; your presentation of the data does not really hold up to any more stringent measure of validity as a result of your lack of statistical controls.

Edtied to add: In any statistics course (I took them, I taught them to bored, glassy-eyed undergraduates for a couple of years) - one cardinal rule taught very early on is that averages do not always provide for the most meaningful representation of data.

Last edited by Tober138; 02-13-2009 at 03:29 PM..
 
Old 02-13-2009, 03:36 PM
 
7,104 posts, read 9,698,581 times
Reputation: 2564
Tober I'm impressed but with my IQ about the same as my body temp I'm just going to accept what you're saying.Looks pretty professional to me!

Good job especially about recommendation as to what to buy before OP returns.
 
Old 02-13-2009, 03:51 PM
 
Location: Up above the world so high!
45,270 posts, read 88,310,401 times
Reputation: 39844
Quote:
Originally Posted by johne482 View Post
I wasn't going to respond to this thread until I starting thinking about what might keep me up all night. This will, trying to figure out this guy's M.O.

This post he did here must have taken and hour and half to type but he says he can't remember how to log-in.BUT he remembers that he warned everybody not to buy so now he's back to claim his trophy.
Gettting your log-in information sent to you by CD takes about 1 minute of your time. Believe me I did it sitting under a palm tree in a third world country that only has electricity 7 hours a day. So this doesn't make sense.

He's not selling houses, that's pretty clear.
So, what's the real deal here? Let me ask OP. OP what do you get out of this thread and your display of charts, long winded posts, and all this carrying on.
Please try and respond by 9:30 PM as I'm tired and want to go to bed early. Don't want to toss and turn all nite long thinking about you. I want to think about those 8 days left to 86 degree weather.
TIA
Sleepless in NY
You pegged it - someone this committed has a cause and an agenda - anyone thinking of taking his advice would do well to remember that
 
Old 02-13-2009, 03:53 PM
 
Location: Up above the world so high!
45,270 posts, read 88,310,401 times
Reputation: 39844
Quote:
Originally Posted by Tober138 View Post
The problem is that the data is too simple. If I understand what you are posting, the comparison is between average asking prices and average sale prices at each time point with no other qualifications or statistical controls. A more accurate graph would not take the average asking price across the board and compare it with an average sales price across the board as aggregate numbers. To do so is a poor, and somewhat inaccurate, statistical approach.

A more accurate representation would be to look at every individual sale in a given time period, calculate the difference between the asking price and sales price for every individual home and present the data as the relative, average difference between asking and sales prices. And present some standard deviations and medians too.

You need to control for price points. For example, lets say houses are selling for about 10% less than their listing price - That means people asking $100k were getting $90k, people asking $200k were getting $180k - and people asking $500k were getting $450k. If you have 15 houses for sale at a given point in time, 5 each at those three asking and selling price points, your graph (as you calculated it) would show an average difference between listing price and sales price of $26,666.66. But for people with the $100k and $200k homes, that is an inflated amount, but the way in which you presented your data would suggest that anyone listing their house could expect to sell it for ~ $26,700 less than they were asking for it.

That is just one of many ways the data can be misinterpreted. It could be the opposite, lower end homes are losing more and higher end homes are losing less. I'm not a realtor, I don't know the trends.

Another example - You also need to control for outliers. Say there are 5 houses for sale at a given point - 4 sell for $5000 less than the asking price. One sells for $20k less than the asking price. using an overall average, it looks houses are selling for $8 less than their asking price on average, when that is not really the case - that overall figure is being artificially inflated because one properly lost a lot of money compared to the rest (for whatever reason) but its obviously not representative.

And what about controls for the actual asking prices? Maybe some homeowners are listing highly inflated prices (possibly more than the house really is worth). Say the fair market value for my house is $250k, but I'm going to list it at $275k hoping that I might find a buyer willing to pay that much - or at least give me the full fair market value after negotiation because I gave them room to maneuver down without hurting my bottom line. In the end, I sell for $240k - is that $35k difference meaningful in any way? No, because, had I listed for a realistic price of $250k, I'd show that it sold for $10k less than asking instead of $35k.



True enough - at least in the immediate future. But no one can say how far or how long until that trend changes. And Charlotte never had a bubble like the northeast, so the drop here will never be as drastic as in some parts of the country.



And, as with your statistical analyses, this blanket statement is woefully oversimplified and controls for no other variables and, hence, is not very useful.



In between postings, may I suggest purchasing a statistics textbook.



And the data you presented may have face validity, but that's about it; your presentation of the data does not really hold up to any more stringent measure of validity as a result of your lack of statistical controls.

Edtied to add: In any statistics course (I took them, I taught them to bored, glassy-eyed undergraduates for a couple of years) - one cardinal rule taught very early on is that averages do not always provide for the most meaningful representation of data.

Very good info, thanks
 
Old 02-13-2009, 04:28 PM
 
11 posts, read 13,823 times
Reputation: 29
Quote:
Originally Posted by massageman View Post
Namely, higher priced homes in this market are taking much longer to sell due to various reasons- less out of state buyers with a lot of equity, tighter credit and young families not feeling secure enough to stretch for a bigger house right now. So, we still have high priced homes sitting on the market but the cheaper homes are the ones selling for the most part, skewing your graph.
Of course you're correct that averages are affected by variations within the range, and your theory may be correct.

But that doesn't change this - prices are falling and people are putting their homes on the market for more money. That is a disaster.

If we take your point as true, then it's more of a disaster, because, if your point is true, then that means that the top end of the housing market is abysmal, and so those at the top end are going to take a beating when they sell, which, when they finally are forced to, will mean a further reduction in the average.



Quote:
Originally Posted by massageman View Post
In reality, nobody lowers their home that much, it is a gradual process of chasing the market down. I hope that makes sense.
Not true. If there aren't 100k reductions already, there soon will be.

Quote:
Originally Posted by massageman View Post
Another point I disagree with you about is the 1-2% increase you talk about. I think the number is much higher than that, isn't it, more like 5%? I thought the 1-2% is really the amount above inflation that homes have historically increased. It is true that homes don't beat the stock market over any 20 year period and things like that, they aren't supposed to be investment vehicles first and foremost.
Yes, I meant real gain, not inflationary gain.
The 5% number you frequently hear is the lie they tell to the gullible.
You can put spoons in a drawer and they will "appreciate at 5%" if you ignore the fact that the appreciation is simply inflation.

Quote:
Originally Posted by massageman View Post
As far as neighborhoods that are doing well, a realtor could give you that information. Even in cities devastated by the housing crash, there are desireable places that will lose less as a percentage.
There will be differences, but it's not about "desirability".

The house I sold in DC for 680 in April 05 is on the market right now for about 464. The area was "desirable," meaning that the public schools were the best in the country and there were wall to wall doctors and lawyers and professors around us. Desirability didn't help.

Quote:
Originally Posted by massageman View Post
Give us these types of numbers for Charlotte and your arguments will be taken more seriously.
I'm sorry I've been misunderstood.
If there is anybody reading this who is, say, older than 30, a realtor, a banker, a mortgage broker, a Charlotte booster, or the like, I'm not talking to you.

The post was for young people who may be thinking about buying in Charlotte (or anywhere else).

I'm attempting to give them guidance based on my understanding of the world and statistics.


Quote:
Originally Posted by massageman View Post
Finally, are you really sure we're looking at another 20% down? What if it's only 14% or 8% or 4%? Should I tell my wife that we didn't get the existing home or new lot she really, really loved because I thought the market would go down another 6%? She'd rather pay an extra 10k perhaps and get her first choice of home.
People can believe whatever they'd like. When I was telling people 2 years ago that a depression was coming, along with a banking collapse, most didn't believe me then either.
But a few did, and I get their thanks from time to time.
There will be at least one young person reading this who will see the dangers in assuming a massive mortgage in a falling home price environment.
You say, "she'd rather pay the extra 10 grand". First, it's not just 10 grand. It's all the interest you'll pay, so it's more like 20 grand.

What you do with your wife is your business. My wife is, like me, very practical, and our experience is that there will always be a suitable house on the market, no rush to buy.

But yeah, I'd wait a year to save 20 grand, and I'd wait 2 to save 40.

And that's only on a 200k house.

Some people want it now and are willing to pay. Not me. But I'm 40, about to retire, living in a 3500 sq foot house that I paid for with cash, so I suppose I'm not the average ok-with-living-in-perpetual-debt kind of guy.

Quote:
Originally Posted by massageman View Post
I agree that realtors always say it's a great time to buy, they have hurt a lot of people in the last five years with their ambition for commissions, if not dishonesty. On the other hand, at some point, it's time to start shopping around for a good deal on a place you would love to call home for the next phase of your life.
I agree, I just think 2 things . . .

1. That time will be in about 3-5 years, when the depression is hitting rock bottom, and,
2. Nobody's job is secure at this juncture. I fully expect unemployment to reach 25% in the next two years.

Prices are going to drop going forward.

Forget about interest rates - word to the young - save save save save, and when you do buy, pay cash and you'll never have to worry about what interest rates are doing.
 
Old 02-13-2009, 04:45 PM
 
11 posts, read 13,823 times
Reputation: 29
Quote:
Originally Posted by Tober138 View Post
The problem is that the data is too simple. If I understand what you are posting, the comparison is between average asking prices and average sale prices at each time point with no other qualifications or statistical controls. A more accurate graph would not take the average asking price across the board and compare it with an average sales price across the board as aggregate numbers. To do so is a poor, and somewhat inaccurate, statistical approach.
First, there is no "comparison". There are only two easily understood trend lines. Average price sold and average price of new listings.

I am not "comparing" them.

Second, there could not be a "more accurate graph," as that is not possible, as the graph is 100% accurate. The numbers are taken from a Realtor's website, and every point in the range was plotted.

While you may disagree that the graph shows something or other, you may not disagree that it is "accurate" unless you can show an error in the data.

Finally, you can break down a range into whatever you'd like, but your argument is just argument. If you think subranges would show something different, then by all means post a graph!!!

Any of you who are arguing this same point - that the average of all houses is not representative - post a graph!!!

Do it! We'd all love it.


Otherwise, we have two things -

My 100% accurate data, and
your dislike of my 100% accurate data.

Sorry, in a contest of data vs. dislike, data wins.

Post a graph.


Quote:
Originally Posted by massageman View Post
You need to control for price points . . . but the way in which you presented your data would suggest that anyone listing their house could expect to sell it for ~ $26,700 less than they were asking for it.
1st, the "way" I presented Realtor data (not "my" data) was the basic, standard way - line graph.
2nd, the "way" it is presented suggests nothing about "anyone" listing their house.

What it shows (not suggests) is that average sales price is dropping quickly and average new listing asking price is rising, and that is inarguable.

Quote:
Originally Posted by massageman View Post
True enough - at least in the immediate future. But no one can say how far or how long until that trend changes. And Charlotte never had a bubble like the northeast, so the drop here will never be as drastic as in some parts of the country.
Time will tell. I'd say it's going to be much worse in Charlotte over the next 20 years.


Quote:
Originally Posted by massageman View Post
In between postings, may I suggest purchasing a statistics textbook.
Why so angry? No need to personally attack me.
What skin do you have in the game?

Quote:
Originally Posted by massageman View Post
And the data you presented may have face validity, but that's about it; your presentation of the data does not really hold up to any more stringent measure of validity as a result of your lack of statistical controls.
The data I presented are so clear and obvious that I'm sure that the majority of people seeing the graphs will understand that the average price of houses sold in Charlotte is dropping rapidly.

That's exactly what I wanted to communicate.

If, after seeing:the clear downward trend for prices, the downward spiral of the economy, and the rising unemployment rolls,

they still want to, with zero evidence, buy a house right now. - Bless 'em.

By the way.

Several posters, who I'd guess are realtors/banker types, have obviously spent a very long time writing up their posts and trying to find holes in a simple average-sales-price line graph.

How about somebody takes an equivalent amount of time to show how some sub-segment of Charlotte homes are "holding value"?
 
Old 02-13-2009, 04:54 PM
 
11 posts, read 13,823 times
Reputation: 29
Quote:
Originally Posted by johne482 View Post
So, what's the real deal here? Let me ask OP. OP what do you get out of this thread and your display of charts, long winded posts, and all this carrying on.
Please try and respond by 9:30 PM as I'm tired and want to go to bed early. Don't want to toss and turn all nite long thinking about you. I want to think about those 8 days left to 86 degree weather.
TIA
Sleepless in NY
Well, it's obvious that about a dozen posters in this thread make money when somebody buys a house in Charlotte.

Why else would they call me retarded?

Think about it.

Can anybody think of a single reason why I would attempt to convince people NOT to buy a house in Charlotte?

Think, think, think.

I especially want YOU, that young person. Maybe 20-something, maybe a kid on the way. You'd really love to buy that "starter" house. But you'd have to go into massive debt to get it.

The only thing I can think of is that I own places in Charlotte that I'd like to rent, but, as my IP will show, I live in Western PA, and I have no interest in Charlotte other than that there is a mistaken belief that Charlotte is "immune" from the depression that is setting in.

So come on. I mean, it's easy for me. Those calling me "retarded" and "go buy a stats book" and whatever else you want to call me . . . it would be easy to suggest a motive for why a person would NOT want any data posted or discussed that indicated that buying a house would be a bad idea.

What if you sell things that new homeowners buy?
Or if you sell title insurance?
Or loans?
Or Real estate services?
Or a real estate attorney?
Inspection agency?
Appraiser?

HMMMMMMMMMMmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm?
All of these people only make money when you buy a house.

Now think of me.

What can be said?

It's so obvious as to why I'm here it hurts.
 
Old 02-13-2009, 04:57 PM
 
Location: Up above the world so high!
45,270 posts, read 88,310,401 times
Reputation: 39844
Quote:
Originally Posted by DavidMar View Post
Well, it's obvious that about a dozen posters in this thread make money when somebody buys a house in Charlotte.

Why else would they call be retarded?

Think about it.

Can anybody think of a single reason why I would attempt to convince people NOT to buy a house in Charlotte?

Think, think, think.

I especially want YOU, that young person. Maybe 20-something, maybe a kid on the way. You'd really love to buy that "starter" house. But you'd have to go into massive debt to get it.

The only thing I can think of is that I own places in Charlotte that I'd like to rent, but, as my IP will show, I live in Western PA, and I have no interest in Charlotte other than that there is a mistaken belief that Charlotte is "immune" from the depression that is setting in.

So come on. I mean, it's easy for me. Those calling me "retarded" and "go buy a stats book" and whatever else you want to call me . . . it would be easy to suggest a motive for why a person would NOT want any data posted or discussed that indicated that buying a house would be a bad idea.

What if you sell things that new homeowners buy?
Or if you sell title insurance?
Or loans?
Or Real estate services?
Or a real estate attorney?
Inspection agency?
Appraiser?

HMMMMMMMMMMmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm?
All of these people only make money when you buy a house.

Now think of me.

What can be said?

It's so obvious as to why I'm here it hurts.
Yep, it sure is.
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