I had a realtor call me this evening and we had a long interesting discussion. We agreed that real estate prices are down 35%-40% from the peak and that number of transactions declined about 80% earlier this year, recovered to down like 70%, and the realtor has hopes that it might recover to down 60%.
And if anything like that had been mentioned in the article, that comments of optimism were tempered with realistic comments of where we are then my satirical comment would not have made sense.
But the opening sentence denies a realistic sense of the current situation. If SB real estate was viewed as a single large-format retail store then it would be in bankruptcy. (Tell me a retail store that survives an 80% drop in sales and 40% drop in prices). The second sentence could be "But local realtors see signs that it could be avoid being liquidated and instead be reorganized and emerge from bankruptcy."
And maybe realtors see comments of "no rule book" and "operating as a barter system" as indicating things are as bad as if Planet X had hit the earth. And talking about sellers needing to reduce prices might mean to realtors that properties that had been aggressively priced to sell are now overpriced and need to come down 25% to have a chance. When I see "no rule book" and "barter system" I think of the new rules of trying to finance, especially for condos. And when I see "reduce prices", I think of all the properties that were overpriced and did not sell during the boom. I think there are good number of properties listed that could halve the asking price and still not sell.
And my little bit of satire was not meant as taking shots of the particular realtors quoted in this article. It was a shot at all of the comments for the past 10 months from all the quoted realtors in the Sunday Real Estate section of how things are getting better month by month and the consistent message of "act now before the deals are gone".
Aic, My last point is simply as stated - What is the plan to transfer knowledge from the current staff with average experience of 27 years to younger employees?
At current staffing they are running a significant deficit. Construction activity would have to increase by at least 30% for them to even break even with the proposed fee hike. Since they are so quickly consuming their reserve funds, one can presume that when things improve that they will hold off on hiring until they are confident that they are running a surplus.
So it should be expected that, at best, there will only be new hires to replace people that have retired. So only after the knowledge is lost will there be a replacement to learn it. (If the retiree's expertise is known by others then staff could be reduced today without losing expertise).
I don't doubt that they have expertise. I don't know their ages or their personal plans.
It just seems to me that they have an older staff and if the plan is to run deficits to keep them then I don't see how they will be in a position to hire younger workers to learn from current staff until members of the current staff have retired. Thus, keeping current staffing levels makes it harder to transfer expertise to future new staff.
If instead they cut staff (as horrible as that is) to be closer to revenues then when things are modestly better they could hire new staff to learn and thus transfer knowledge. (BTW, I do not think the criteria for whom to retain should be based upon whomever is the most senior. It makes more sense to retain based upon breadth of knowledge than seniority).
Though, I should congrat the article for containing these charts. This is the data that truly reflects the current state of a real estate market whether it be good or bad.
Though, the listing charts seems odd. It says there are no single family homes listed for less than $250K and that the chart covers "SB and south valley". So apparently "south valley" does not include Stagecoach, Oak Creek or further south. The area covered by the charts needs to be disclosed.
And maybe next week the charts will be for the entire county.
And since the building dept has such great expertise with average experience of 27 years then what is the plan when these people start retiring? There certainly are not enough young inspectors being trained to replaced the experienced inspectors. And if construction activity remains slow for a few years then there will continue to be no budget to hire and train replacements and the expertise will be even closer to retirement.
Simply put, having average experience of 27 years means the dept has gotten old and they also need to figure out how they are going to pass the expertise along.
Newsflash - Sunrise Give Realtors Hope SB - Local realtors expressed hope after the sun rose today. Despite price declines of about 33% and number of sales declining by 75%, local realtors expressed hope after the sun rose today. "The fact that the sun rose today proves that the world did not end last night" said local realtor Mindless Promoter, "that results in a much stronger market than if the world had been destroyed by Planet X last night".
"A property sold and I just know that if those people had not purchased it for 35% less than what it sold for two years that other people would have purchased it" said local realtor Polly Anna. She says "Just because there are dozens of similar properties with similar price declines still on the market does not mean there were not lots of buyers standing in line for the properties that did sell". She concludes "So anyone thinking of buying needs to buy now before every property they like is sold."
Local Realtor Mr Ignorance S Bliss said that the because he cannot remember the local real estate market having prices down so much and still being so slow that it is now "due" for a "home run" month.
They noted in unison that "if it's Fall then we have Christmas shoppers, if it's Winter then we have skier visitors, if it's Spring then we have prime buying season, and if it's Summer then we have summer tourists".
Other resort areas starting feeling the recession in second half 2007 when it started affecting the rest of the country. I think we continued on booming because of the Intrawest purchase of the ski area.
Historically, resort RE takes a bigger hit than RE nationally during a recession because people need their primary home far more than they need a vacation home. For the same reason, resort RE takes longer to recover because people rebuild their personal financial situation before feeling good enough to buy a vacation home.
I think much of what was built recently that was targeted towards baby boomers taking early retirement in luxury is going to prove difficult to sell. The market has slowed so much that it is possible that the older baby boomers tired of high altitude winters will largely saturate the market selling to the younger baby boomers.
A big question will be how many people that can work anywhere will see a dip in prices as an opportunity to make SB their primary residence. That could lead us to an earlier recovery than seen in previous recessions.
Tourism is historically not as severely affected by recessions because people still need to take a break. People will tend to spend less, but that can mean a Colorado ski vacation on a budget instead of more expensive alternatives. I think tourism this winter will probably be similar or better than last winter.
I am not terribly worried about Intrawest or Fortress. If there are bankruptcies then the ski area will continue operating while the debt is restructured. The ski area is not in the middle of a major capital improvement program that might be stopped by a bankruptcy.
I am far more interested in the various local developers that appear to be in financial troubles. When the managing partner of the 360 development has properties in foreclosure and a stack of unpaid property taxes then that raises questions about that project. Not paying property taxes is a way to temporarily conserve cash at currently 10% interest rates plus modest fees. And when a guy like that cannot borrow money from his banker at less than 10% then his fellow investors can spin it as much as they want, but he has issues.
Well, how about educators learning from others on what works and does not work. For instance, as much as well love small classrooms, the data says the quality of the teacher is far more important than the size of the classroom especially as the kids get older. So if they allow budget cuts to increase classroom size then that does not necessarily sacrifice quality.
Aic, Your analogy confuses the builder (surgeon) with the building dept (state accrediting medical board). You appear to be arguing that it doesn't whom is chosen to build (or you could just as well do it yourself) as long as there is a good inspections dept.
I don't what sort of person you hire to do construction work, but based upon your comments it appears that you need to hire a competent general contractor that has good trusted subs.
The more relevant numbers are not month to month (Sept vs August) which move up and down here with all of our seasonal businesses, but compared to a year ago. Raw data is at http://www.bls.gov/lau/ and then selected LAU (local area) and "One Screen".
Sept 2007 had 15,152 employed and 409 unemployed Sept 2008 had 14,949 and 513 Sept 2009 had 13,748 employed and 876 unemployed.
Aug to Sept normally loses jobs here. 08/07 to 09/07 lost 579 jobs. 08/08 to 09/08 lost 589 jobs. 08/09 to 09/09 lost 702 jobs.
With all of the lost jobs, (down 1,400 jobs in two years), the real effect is much worse than the 6.2% official rate. We have a lot of independent contractors and part time workers that normally work several jobs that are not counted as unemployed.
Window shoppers give Realtors hope
I had a realtor call me this evening and we had a long interesting discussion. We agreed that real estate prices are down 35%-40% from the peak and that number of transactions declined about 80% earlier this year, recovered to down like 70%, and the realtor has hopes that it might recover to down 60%.
And if anything like that had been mentioned in the article, that comments of optimism were tempered with realistic comments of where we are then my satirical comment would not have made sense.
But the opening sentence denies a realistic sense of the current situation. If SB real estate was viewed as a single large-format retail store then it would be in bankruptcy. (Tell me a retail store that survives an 80% drop in sales and 40% drop in prices). The second sentence could be "But local realtors see signs that it could be avoid being liquidated and instead be reorganized and emerge from bankruptcy."
And maybe realtors see comments of "no rule book" and "operating as a barter system" as indicating things are as bad as if Planet X had hit the earth. And talking about sellers needing to reduce prices might mean to realtors that properties that had been aggressively priced to sell are now overpriced and need to come down 25% to have a chance. When I see "no rule book" and "barter system" I think of the new rules of trying to finance, especially for condos. And when I see "reduce prices", I think of all the properties that were overpriced and did not sell during the boom. I think there are good number of properties listed that could halve the asking price and still not sell.
And my little bit of satire was not meant as taking shots of the particular realtors quoted in this article. It was a shot at all of the comments for the past 10 months from all the quoted realtors in the Sunday Real Estate section of how things are getting better month by month and the consistent message of "act now before the deals are gone".
November 22, 2009 at 11:31 p.m. ( permalink | suggest removal )
Struggling building department seeks 58 percent fee increase
Aic,
My last point is simply as stated - What is the plan to transfer knowledge from the current staff with average experience of 27 years to younger employees?
At current staffing they are running a significant deficit. Construction activity would have to increase by at least 30% for them to even break even with the proposed fee hike. Since they are so quickly consuming their reserve funds, one can presume that when things improve that they will hold off on hiring until they are confident that they are running a surplus.
So it should be expected that, at best, there will only be new hires to replace people that have retired. So only after the knowledge is lost will there be a replacement to learn it. (If the retiree's expertise is known by others then staff could be reduced today without losing expertise).
I don't doubt that they have expertise. I don't know their ages or their personal plans.
It just seems to me that they have an older staff and if the plan is to run deficits to keep them then I don't see how they will be in a position to hire younger workers to learn from current staff until members of the current staff have retired. Thus, keeping current staffing levels makes it harder to transfer expertise to future new staff.
If instead they cut staff (as horrible as that is) to be closer to revenues then when things are modestly better they could hire new staff to learn and thus transfer knowledge. (BTW, I do not think the criteria for whom to retain should be based upon whomever is the most senior. It makes more sense to retain based upon breadth of knowledge than seniority).
November 22, 2009 at 7:30 p.m. ( permalink | suggest removal )
Window shoppers give Realtors hope
Though, I should congrat the article for containing these charts. This is the data that truly reflects the current state of a real estate market whether it be good or bad.
Though, the listing charts seems odd. It says there are no single family homes listed for less than $250K and that the chart covers "SB and south valley". So apparently "south valley" does not include Stagecoach, Oak Creek or further south. The area covered by the charts needs to be disclosed.
And maybe next week the charts will be for the entire county.
November 22, 2009 at 10:21 a.m. ( permalink | suggest removal )
Struggling building department seeks 58 percent fee increase
And since the building dept has such great expertise with average experience of 27 years then what is the plan when these people start retiring? There certainly are not enough young inspectors being trained to replaced the experienced inspectors. And if construction activity remains slow for a few years then there will continue to be no budget to hire and train replacements and the expertise will be even closer to retirement.
Simply put, having average experience of 27 years means the dept has gotten old and they also need to figure out how they are going to pass the expertise along.
November 22, 2009 at 2:44 a.m. ( permalink | suggest removal )
Window shoppers give Realtors hope
Newsflash - Sunrise Give Realtors Hope
SB - Local realtors expressed hope after the sun rose today. Despite price declines of about 33% and number of sales declining by 75%, local realtors expressed hope after the sun rose today. "The fact that the sun rose today proves that the world did not end last night" said local realtor Mindless Promoter, "that results in a much stronger market than if the world had been destroyed by Planet X last night".
"A property sold and I just know that if those people had not purchased it for 35% less than what it sold for two years that other people would have purchased it" said local realtor Polly Anna. She says "Just because there are dozens of similar properties with similar price declines still on the market does not mean there were not lots of buyers standing in line for the properties that did sell". She concludes "So anyone thinking of buying needs to buy now before every property they like is sold."
Local Realtor Mr Ignorance S Bliss said that the because he cannot remember the local real estate market having prices down so much and still being so slow that it is now "due" for a "home run" month.
They noted in unison that "if it's Fall then we have Christmas shoppers, if it's Winter then we have skier visitors, if it's Spring then we have prime buying season, and if it's Summer then we have summer tourists".
November 22, 2009 at 2:36 a.m. ( permalink | suggest removal )
Routt County unemployment rate increases in October
Other resort areas starting feeling the recession in second half 2007 when it started affecting the rest of the country. I think we continued on booming because of the Intrawest purchase of the ski area.
Historically, resort RE takes a bigger hit than RE nationally during a recession because people need their primary home far more than they need a vacation home. For the same reason, resort RE takes longer to recover because people rebuild their personal financial situation before feeling good enough to buy a vacation home.
I think much of what was built recently that was targeted towards baby boomers taking early retirement in luxury is going to prove difficult to sell. The market has slowed so much that it is possible that the older baby boomers tired of high altitude winters will largely saturate the market selling to the younger baby boomers.
A big question will be how many people that can work anywhere will see a dip in prices as an opportunity to make SB their primary residence. That could lead us to an earlier recovery than seen in previous recessions.
Tourism is historically not as severely affected by recessions because people still need to take a break. People will tend to spend less, but that can mean a Colorado ski vacation on a budget instead of more expensive alternatives. I think tourism this winter will probably be similar or better than last winter.
November 21, 2009 at 9:04 p.m. ( permalink | suggest removal )
Routt County unemployment rate increases in October
I am not terribly worried about Intrawest or Fortress. If there are bankruptcies then the ski area will continue operating while the debt is restructured. The ski area is not in the middle of a major capital improvement program that might be stopped by a bankruptcy.
I am far more interested in the various local developers that appear to be in financial troubles. When the managing partner of the 360 development has properties in foreclosure and a stack of unpaid property taxes then that raises questions about that project. Not paying property taxes is a way to temporarily conserve cash at currently 10% interest rates plus modest fees. And when a guy like that cannot borrow money from his banker at less than 10% then his fellow investors can spin it as much as they want, but he has issues.
November 21, 2009 at 9:30 a.m. ( permalink | suggest removal )
Education cuts being brainstormed
Well, how about educators learning from others on what works and does not work. For instance, as much as well love small classrooms, the data says the quality of the teacher is far more important than the size of the classroom especially as the kids get older. So if they allow budget cuts to increase classroom size then that does not necessarily sacrifice quality.
November 21, 2009 at 1:53 a.m. ( permalink | suggest removal )
Struggling building department seeks 58 percent fee increase
Aic,
Your analogy confuses the builder (surgeon) with the building dept (state accrediting medical board). You appear to be arguing that it doesn't whom is chosen to build (or you could just as well do it yourself) as long as there is a good inspections dept.
I don't what sort of person you hire to do construction work, but based upon your comments it appears that you need to hire a competent general contractor that has good trusted subs.
November 21, 2009 at 1:42 a.m. ( permalink | suggest removal )
Routt County unemployment rate increases in October
The more relevant numbers are not month to month (Sept vs August) which move up and down here with all of our seasonal businesses, but compared to a year ago. Raw data is at http://www.bls.gov/lau/ and then selected LAU (local area) and "One Screen".
Sept 2007 had 15,152 employed and 409 unemployed
Sept 2008 had 14,949 and 513
Sept 2009 had 13,748 employed and 876 unemployed.
Aug to Sept normally loses jobs here.
08/07 to 09/07 lost 579 jobs.
08/08 to 09/08 lost 589 jobs.
08/09 to 09/09 lost 702 jobs.
With all of the lost jobs, (down 1,400 jobs in two years), the real effect is much worse than the 6.2% official rate. We have a lot of independent contractors and part time workers that normally work several jobs that are not counted as unemployed.
November 21, 2009 at 1:21 a.m. ( permalink | suggest removal )