I have mentioned for the last couple of years that the market in the major cities in California of San Diego, LA, San Francisco and San Jose will see a gradual decrease in demand followed by a very strong downturn. As typical in most downturns, the first year to year and a half a market sees the market slow down at a reasonable 5-10% in value. This is followed by a false flattening in the market. We have seen this flattening occur the latter part of '06 to the early part of '07 in California. The biggest mistake people make is to think that the correction is over, where, in reality, the second pricing drop is eminent.
The next stage is usually a sharp turn downwards followed by an aggressive downturn created by seller's who have either lost jobs or their homes are upside down with their mortgage. Here we should see an additional 10-20 decline in values, for an estimated downturn of 30% since the peak of the market in late '05. With many California buyers securing 100% financing or negative amortization financing, the down turn has the potential to be worse than many have projected.
Only time will tell, but my best estimate is that 2008 will the major downturn not seen since '91 to '93. This is merely a normal correction in a market that has exceeded the normal differential in values from other cities in the US over the last several decades. In reality, when you look at the past 10 years going into the down turn through '08, the California market will still show a very healthy increase. Those that have bought in the past 4 years will be affected greatly.
Having been a Californian, I visit California 2-3 times each year, and my latest trip in July was quite eye opening. Builders are now starting major incentive programs not seen in over a decade. Prices are dropping as anticipated, but not at the anticipated downturn predicted for next year. Many buyers and their agents are ignoring the trend and are still asking for prices grotesquely above the current market. This is typical of buyers that are substantially upside down with their mortgage or purchase price within the past few years. The prediction of a soft landing in California is not likely.
Soft landings are typical in the Midwest and northern US, but hard landing are more typical in the East and West coasts. On the other hand the East and West coasts tend to experience massive increases in values during the boom cycle. The landing is currently somewhat soft to moderate, but will turn to a fairly harsh landing in the coming year. The investors have fled the market 2 years ago and I do not anticipate their return until '09.
In comparison to Austin over the last several decades, California has ranged from around 1.5 to 2 times the median market value of Austin. For the last 5 years this number has been running from 3 to 3.5 times the Austin median market value. There will be a combination of an increase in the Austin market with a decrease in the California market. The long term normal differential should even out between '08 and '09. Mortgage program reconstruction, rising interest rates, and rising gas prices should cause the change to happen earlier than anticipated. Austin saw the panic sales in '01 to '03 while California was experience incredible growth in values. Naturally, the cycles of real estate come around; and, that is what we are all seeing.
Austin will continue to gain substantially from the continued downfall from the west coast markets until the equilibrium is reached once again, and a stabilization in the Austin market will be reached at that time. Sometime in '08 to '09 we will once again see investors flocking back to California to buy "deals" that will be created as a result of the California correction.
In the long run, both California and Austin will be incredible investment arenas in real estate as the world will not walk away from either location. Mind you I love California with all my heart and have just put an offer on a $2mm condominium in Coronado and am in final negotiations for less than half the so called market price. I completely believe that this will be back to a $3mm condo by 2010 or 2011, as condos just like it sold 2 years ago in excess of $3mm.
This is not negative news to California, but merely a reality of what the any cycle sees decade after decade. I was there to watch the fall of the summer of '90, and the panic of '91 and '92, watching my home drop 25% in one year. Hopefully we will not see any grand earthquakes over the next few years, as that will fuel the downfall. Many people are concerned of the negative news of the effects of global warming reducing the coastline causing further downfalls in pricing. I think that this is overly pessimistic thinking at this time. It is a serious concern, but I do not see the public creating a panic for at least one or two decades.
I am so proud to be asked to speak on how to succeed in a challenging market at Spotlight Austin event this month at the Westwood Country Club with 2 other of Austin's top real estate agents. My speech will mainly focus on MINDSET of marketing a farm area, which will be a different approach that the other two speakers.
This will be an exciting event. I put a similar talk on this in Orlando FL at the Keller Williams International convention. Hopefully, I will do a bit better at this event. It will be alot of fun and look forward to seeing area agents and other real estate related businesses.
Spotlight Austin - 2009 Top Producers Panel
How to Thrive in a Challenging Economic Market
| Host: | Spotlight Austin |
| Type: | Education - Lecture |
| Network: | Global |
| Date: | Thursday, July 23, 2009 |
| Time: | 5:30pm - 7:30pm |
| Location: | Westwood Country Club |
| Street: | 3808 W. 35th Street |
| City/Town: | Austin, TX |
| View Map |
| Phone: | 5122411818 |
| Email: | allison@pattentitle.com |
This was a great 4th of July weekend both with family....and my farm. I noted a few days ago that our little group was sponsoring our 4th of July celebration in two communities:
http://activerain.com/blogsview/1139335/why-would-you-work-on-the-4th-rather-than-be-with-family-and-others-
One was a parade of about 500 and the other was a luncheon of around 1000 people. The parade we passed out eco friendly grocery bags (with our logo on it, of course) and the other we passed out 750 ice creams to the kids (and, yes, alot of adults). We also numerous trash cans (yes, with our logo on them).
They both were a great hit and we had great exposure for our agents in both neighborhoods.
Did it take away from our family time?
No.
We actually had our families at the parade and at the luncheon. I figure why not do an event that I can also bring my family and have great family time. It is sort of like working.....but really not. We really had a lot of fun. The only "work" part of it was getting everything set up early in the morning and taking everything back to the office, but that was an hours work at most. The rest of the weekend was devoted to family time.....dinner....movie....went to a party......fireworks and all. Got an offer on a home, and a deal fell apart; so I am hoping that is a fair trade. Now Monday comes.....
 |
|
|
#1 KW Group, Austin (nwmc,'07,'08 ) #2 Group in Austin '08-Austin Business Journal Certified Luxury Home Marketing Specialist www.TopKWGroup.com
Co-owner of the Bartlett Real Estate Group, (Ranked #1 in Austin NWMC & #29 w/ Keller Williams internationally in 2008) Tim, a native Texan, received his business degree from Baylor University in 1981 and started his real estate sales career in Houston. Tim has been involved with developments from raw land to tentative mapping, to final mapping, to marketing projects at these stages, or upon completion of the infrastructure, or marketing homes on the completed homesites. My partners are Tom & Marissa Radack and Ken Bartlett; for more details on our entire group see our website at www.TopKWGroup.com
Upon relocating to San Diego in 1986, Tim operated as an independent real estate broker marketing exclusive residential homes, acre-plus estate sites and subdivision development sites (either completed or at various mapping stages).
Since moving back to Texas in 1995 from California, Tim has continued to focus on marketing very upscale residences, winning numerous company and national achievement awards to include the following:
Tim markets residences in the west Austin, and is a premier specialist in the "River North" area designation, to include River Place, Westminster Glen, Glenlake Estates, Long Canyon, and Steiner Ranch as well as new home subdivision sites.
As 15 year residents of River Place, Tim and his family love the variety of amenities and atmosphere that River Place and the surrounding area offers as well as the easy access to the many amenities that Austin provides. He has watched most of the homes being built in the River North area, which gives him a tremendous marketing advantage.
Tim's strength was partially derived from a real estate broker in La Jolla who was blinded at an early age, yet became an extremely successful real estate agent, broker, mediator, and real estate board president. Read the astonishing story at www.klattrealty.com. He further gains his drive from one grandfather who was a professional football player, and another who ran a very successful steel manufacturing comany and was president of the Steel Builder's Association. "I feel it is my obligation to my ancestors and to my immediate family to help as many people I can to be the best I can be."
Tim enjoys playing ice hockey, running, and enjoying vacations with his family.
See me on FACEBOOK
Tim specializes in new and resale homes valued at $300,000 to the multiple millions as well as marketing and brokerage of new-home subdivision projects from raw land through the development process, to streets, to marketing the individual homesites, homes or condominiums. Tim has been marketing real estate since 1982 and has been consitantly working since his 600 home newspaper route in the 4th grade.
Tim's real estate group has sold over $50mm in 2007 and $45mm in 2008; see website for partner information.
Thanks for your assistance with my tax appraisal. Today I had that review, they took the informal proposal off the table and gave me $25K off. They used your 3 properties and then averaged with the 5 the computer picked and took the average. Once again I really appreciate your help. Joe
In a van down by the river...
I used Tim Moncrief when purchasing my first home here in Austin Texas. Like any first time home buyer, I really had no idea what I was doing. Tim walked me through all the steps of buying the house, showed me multiple great places, and did all the dirty work in getting the deal done. Tim was available anytime I had a questions about ... well anything and everything. The process was so easy that I talked to and about Tim on my radio talk show. Since purchasing my house, I've contacted Tim multiple times with questions about painting, floors, and other home renovations. In every instance, without hesitation, Tim has been there for me. I couldnt have done it without him! Well, I could have but I'd probably be living in a van down by the river instead.
Bobby Bones
Morning Show Host, 96-7 Kiss Fm - Austin
Waterfront lot in River Place....sold in 1 day
We bought a waterfront lot in River Place in Austin from Tim, partner of Bartlett Real Estate Group, and are now building our dream home. Tim was there for us every step of the way and we not only recommend him but we used his team a second time when it was time to sell our existing home during the build. Terry Dailey literally sold our home the first day it was listed!"
Robert and Deborah Corbin
Riverplace on Lake Austin
...saved me $25k in tax appraisal!
Repeat customer...
We worked with Tim Moncrief twice when buying properties in Austin Texas. Both times we felt he was very professional and hard working without putting any pressure on us to buy. He is very knowledgeable in the Real Estate market. We will use him again and have referred other people to him who are buying in the Austin area.
Howard Schwartz
Purchasing a home from 3 states away...
Our experience with Bartlett Real Estate Group was absolutely outstanding. When we first decided to consider moving to Austin Texas, we spoke with an agent who listened to our needs, wants, and requirements for a new home. Not only were we unfamiliar with the area, but we were also fairly new to the home buying process. Purchasing a home from three states away was difficult enough, and finding the realtor to help us in such a dynamic situation was critical.
Bartlett Real Estate Group was recommended to us by friends in Austin, and they lived up to every single expectation we had, and then some. We were able to purchase a home in Austin with the help of Tim Moncrief. His staff was helpful in all aspects of the purchasing process. We purchased our home with his help, and would gladly recommend this real estate group to anyone wishing to have real estate assistance in Austin. Bartlett Real Estate Group went above and beyond in many ways, and their efficient work, vast amount of knowledge, and suggestions helped us settle into a home we are very grateful for.
Ganesh and Jennifer Lyer
The essence of proactivity...offer in 9 days...
We were most pleased with The Bartlett Real Estate Group, in particular Tim Moncrief. Tim is the essence of proactivity. Never once did we feel he should be doing something more than was being done. He helped us understand what the market for our house would be in Austin and what things could be done to best maximize the value we received. We had an acceptable offer within 9 days of it being listed. The buyers were qualified and the transaction went off without a hitch. We would highly recommend Tim and the Group.
Regards,
Cindy Rondini
We won our tax protest......Thanks for all your help.
We won our tax protest! THey returned our construction classification down from a 7- to a 6+ which resulted in the value going down to $588,000 instead of $722,000. They said that we put together a very strong argument to protest taxes which we detailed with photos and features of ther properties. Thanks so much for your help. Without you we would not have been able to effectively argue our case. We really appreciate the time you spent getting all that information to us.
Steve and Odette
One day.....Tim brought us an offer...
Taylor and I were referred to Tim Moncrief through a family friend. We initiated contact with Tim with regard to purchasing a lot in River Place. He immediately began emailing us information on the area as well as current lots available. We were very impressed with his knowledge of the River Place and Austin area. In short order we purchased a lot. His attention to detail in our contract negotiations and closing were excellent. One year later, we decided not to build and to sell our lot. Once again, we contacted Tim. He immediately provided us with area comps and we set our price. One day after listing our lot, Tim brought us an offer. We negotiated and sold. Our experience with Tim Moncrief and Keller Williams was exemplary.
Taylor and Beth Sherwood
Selling in a down market...
Unfortunately, we were selling a home during one of the most disadvantaged home resale markets in recent history in Austin Texas during it's down market a few years ago. This home was purchased during a sellers market when prices were high and the number of available homes was low. We had to move a few years later and the market had changed dramatically. Prices dropped and the number of homes for resale was high.
We listed this home with 2 different agents with no success. A year passed and we were discouraged. We were not getting any offers and very little feedback we could act on. Since nothing was happening, we took the home off the market. We needed new ideas and an innovative marketing program. We contacted Tim with the Bartlett Real Estate Group and after an honest, reality based discussion, listed the home again.
The home was placed on the market based on Tim's suggestions. Even though the home didn't sell immediately, we started to feel that we were on the right track. The home was shown and we received feedback from the potential buyers. Tim simply put more energy into the process and we were pleased to see activity.The market was still down, but we were able to sell the home.
We feel that if we had listed the home with Tim earlier, the home would probably have sold at the same price one year sooner. I would list with Tim Moncrief again without reservation.
Robert & Maggie Rubrecht
We would highly recommend his team...
We engaged the Bartlett Real Estate Group to sell our home in Steiner Ranch, working with Tim Moncrief as our sellers agent. Soon after listing the home, we suffered an unexpected loss in the family and had to leave town. Tim was very empathetic and handled all the showings and looked after the house while we were gone. As a standard part of their services, phenomenal full-color brochures were printed and in constant supply at the home and they developed an interactive listing on the web with fantastic 360-degree views of every room. The home sold in a matter of weeks! We were very happy with the Bartlett Group and especially our agent, Tim Moncrief. We would highly recommend his team and plan on using them again for our next personal real estate transaction.
Kimball & Katie Dempsey
Our advisor...
Working with Bartlett was great. We found Tim to be professional, responsive and very knowledgeable about the housing market in River Place and Austin. We felt confident in having him as our advisor in the sale of our home. Thanks Tim!
Kevin Kerner
Helped us choose the home that was right for us...
Tim´s experience with home sales and with the Austin market were exactly what we needed. He guided us to neighborhoods that were within our budget, but that were sure to maintain value. He also helped us look beyond the aesthetics of each home. As new home-buyers, we appreciated his helping us see this purchase as an investment. He carefully reviewed disclosure documents and he examined the interior and exterior of homes, making sure we noticed the good and not-so-good features. He also talked with us about the resale value of various characteristics. I appreciate that Tim helped us make an informed buying decision. As a result, the home we chose was right for us, for every reason.
Renee & Matthew Lemke
He took a special interest...
My wife and I were very pleased with the job Tim did for us. He took a special interest in our needs and work overtime to make sure we were able to close the deal. I would strongly recommend Tim and his company to anybody looking to purchase or sell their home in Austin.
Ron Schwartz
Sense of family and genuine concern...
Our experience as home sellers with The Bartlett Real Estate Group was absolutely wonderful. Our initial consultation was with Tim Moncrief; his easy-going, yet highly professional and experienced demeanor put us at ease almost immediately and it did not take us long to decide that this was the real estate team for us. During a rather tumultuous negotiating period, we received even more support and advice from other members of the Bartlett team, including Kay Sittler, Tom Radack, and Ken Bartlett himself. The sense of "family" and genuine concern for our well-being put forth by the entire organization was extraordinary. We cannot say enough good things about our home-selling experience with The Bartlett Real Estate Group; we will definitely use them again when we are in the market to buy a house."
Thank you again for everything. Please pass long our regards to Kim and Tim and the rest of the team. Take care and peace be with you.
Cheers,
David
With the help of this awesome realty group...
We have bought and sold three homes in the Austin area with the work of Keller Williams Bartlett Group. Since we consider the homes we live in as important investments we wanted to choose the right family home but also make money on the home. With the help of this awesome realty group we have gotten great advice, have made good decisions, and have had easy transactions. For an expert realtor we would recommend using Tim Moncrief and Sarah Sutfin as your agents - we would definitely want him again.
Monica and David Goodstein
Riverplace and Twin Creeks homebuyers
Amazing difference in service...
In an attempt to save money we decided to use a discount broker that promised one percent expenses but what we got was one percent effort on our behalf. After months of dissatisfactory service, we gave Tim Moncrief a call. From the moment we signed on with the Bartlett Group we noticed the amazing difference in service. The level of professionalism and proactive communication with Tim was incredible. We were well informed through out the entire listing process. His knowledge of the market is without parallel. Within a matter of weeks we had a written offer and we were able to close the deal in short order. We highly recommend, Tim Moncrief to anyone in the River North Area.
Sylvia and Daniel
Great price in a challenging market...
"Tim Moncrief and the entire team at Bartlett provided a totally professional experience. Tim's knowledge of the Riverplace area was instrumental to us quickly selling our property at a great price in a challenging market.
Tim & Margo Naramore"
We were referred to Tim Moncrief at the Bartlett Real Estate Group from a friend in Riverplace who had had a great experience selling their home. We had interviewed a number of agents and also asked them to suggest how we should price our house. What we really liked about Tim was he had a real strategy for selling our house. He told us what we needed to do to get the house ready for sale, he inspected our changes prior to listing to ensure the house was truly ready, and then he used a pricing and showing strategy that got us the price we wanted in 18 days! Tim was able to get the house sold just as the market was headed down last summer. This was key since we had just purchased a new home in Riverplace and did not need to carry two mortgages.
Tim is a real pro, and we will work with him again!
Rick and Liz Froehlich
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
Powered by the ActiveRain Real Estate Network
© 2009 ActiveRain Corp. All Rights Reserved
