Kenmore, WA

Wisdom Comes in All Forms!

Yesterday, right ahead of the Inauguration, Adam Carolla, the morning-radio-talk show host, made one of the most insightful comments about the American psyche that I’ve heard in a long time. He said that Americans are some of the toughest self-critics in the world. We are really hard on ourselves as a nation: we’re demanding of our government; we’re critical of each other; we question our collective values; and, clearly, we can sometimes be very mean to each other. He made this observation with regard to Barack Obama and the incredible excitement generated by his election. Adam said it felt as if our collective self-loathing had been lifted, if only for a moment.

Now, I must confess, over the last several days, I’ve been spending time in the blogosphere reading commentary on some very popular sites and I’ve jumped in on several fairly heated (and ofttimes disagreeable) discussions about how the country has been lead in the past and what’s going to happen now that there’s a new sheriff in town. I have to tell you, some of it is really, really ugly stuff. Don’t go there if you don’t have a thick skin. On the other hand, I’m impressed with the intense thoughtfulness of most of the writers even though some of them utterly infuriate and, more importantly disappoint me. I want to believe that we are, at our core, a good people….

Then it occurred to me that the Founding Fathers INTENDED our political process to be this way. In a sense, the constant revolution that Thomas Jefferson wrote about is alive and well in America today. It’s not a bloody revolution, it’s the battle that Adam Carolla acknowledges (this tendency to navel-gaze). Every four years we literally reinvent our leadership. Sometimes it’s a grand revolution and at other times it’s mundane and at others it’s a knock-down drag-out fight as was this last one. The victors celebrate and rejoice. The vanquished stew in the bitter broth of resentment and plan a new revolution. I find it disturbing, frustrating and strangely invigorating. I suppose it’s one of those things that makes us….well, us.

So here’s what I’ve done to refocus myself on the big picture and help me celebrate the brilliant system the Founding Fathers created: I’ve listed all the Presidents who have held office since I’ve been alive. This helps me put things in perspective. We are one of a few nations in history that passes power from one administration to another without bloodshed. Since I’ve been alive, I’ve voted in 8 presidential elections (haven’t always been on the winning side), and I’ve truly hated some of these men. And yet, our system works. It’s truly magnificent:

Dwight D. Eisenhower, John F. Kennedy, Lyndon Johnson, Richard Nixon, Gerald Ford, James Carter, Ronald Reagan, George H. W. Bush, William J. Clinton, George W. Bush and Barack H. Obama.

What an amazing list of individuals!

CHANGE.GOV - SPEAK OUT, SPEAK NOW!

As the Inaguration of President Elect Barack Obama quickly approaches, Americans know that we face an incredibly challenging future. To say that Mr. Obama has taken on the troubles of the world is an understatement. Now here’s something interesting: The Obama Transition Team is actually asking us, you & me, to give our suggestions and tell our stories. They actually want to hear our ideas to help solve the problems we face.

I spent some time looking through the suggestions of a lot of people on Change.gov just to see if the site would be filled with cynical, angry commentary. On the contrary, there are a lot of thoughtful and concerned Americans who have some excellent, creative ideas. Why don’t you add yours to the list?

If you are interested, just click on the picture below:

The National Association of Realtors has unleashed a media campaign with the theme "Affordability has improved!" When I heard this on the radio this morning, I had to stop and consider whether this is true. After all, home prices are dropping and interest rates are at historic lows. Sounds good. Sounds really good......................but, let's look at reality for a moment:

Today I'm going to share some sobering and grim real estate statistics from both a national and local perspective. Please believe me, for those of you who have excellent credit, secure employment, cash reserves and a desire to purchase a home, this may be an "affordable" market. But, let's not sugar-coat the overall market. It's still a risky place to be:

Foreclosure Filings At Record Highs - UP 81%

Here are several snippets from an Associated Press report today regarding home foreclosures in 2008:

• More than 2.3 million American homeowners faced foreclosure proceedings last year, an 81 percent increase from 2007

• Nationwide, more than 860,000 properties were actually repossessed by lenders, more than double the 2007 level

• The four states with the highest foreclosure rates last year were Nevada, Florida, Arizona and California

• Moody's Economy.com, a research firm, predicts the number of homes lost to foreclosure is likely to rise by another 18 percent this year before tapering off slightly through 2011

If you're an optimist, this may be good news. Indeed, this will expose a huge number of properties to potential buyers, possibly at bargain prices. The down side is illustrated in an old rule of thumb regarding foreclosure: for every home in a neighborhood that goes into foreclosure, the value of the neighborhood drops by 1% of sale value. So, even if your neighborhood is weathering the down market well, the adjoining neighborhoods may very well cause downward pressure on your property values. Remember, whether you like it or not, we are all in this together.

ABSORPTION RATES IN PUGET SOUND, KING AND SNOHOMISH COUNTIES

Absorption rate = Number of weeks/months it takes to sell the current inventory at the present rate of sales.

I have assembled the graphs below to illustrate the absorption rates for our local market. If you want to look these over in detail, just click on the graphs:

KING COUNTY, WA ABSORPTION RATES - 2003-2008

One positive event was the drop of almost 15% of the active homes & condos from the market in December. This should have happened far earlier in the year. Having said this, it's very important to note that only 10% of the available inventory went pending (offers were accepted). One must also take into consideration that a significant number of these pending sales are a result of short sales. This means the transactions may never close before being sold at auction.

PUGET SOUND ABSORPTION RATES - 2003-2008

As a whole, Puget Sound absorption rates in December were even lower than King Co, at 8.2%. There was a 13% drop in active listings.

SNOHOMISH COUNTY, WA ABSORPTION RATES - 2003-2008

Snohomish County was a bit of a surprise with a slightly higher absorption rate than King County at 10.2%. There was also a drop of almost 13% in active inventory.

So let me be clear: we are in the midst of extremely difficult times in real estate. I take offense to any blanket statement that "now is a good time to buy a house." This is simplistic baloney. There are simply too many factors outside of low prices and interest rates that affect the market today. One final thought: as you look at the graphs above, they look rather pathetic. The lines on the graph have managed to hit rock-bottom. I suppose the only way to go is up. Just make sure if you jump on the ride, wear your seat belt!

Monopoly picture courtesy of vinduhl

Let’s start with a definition. What is Market Share?

Market share, in strategic management and marketing, is the percentage or proportion of the total available market or market segment that is being serviced by a company. It can be expressed as a company’s sales revenue (from that market) divided by the total sales revenue available in that market. It can also be expressed as a company’s unit sales volume (in a market) divided by the total volume of units sold in that market. It is generally necessary to commission market research (generally desk/secondary research, although sometimes primary research) to estimate the total market size and a company’s market share.

Yesterday, during a conversation about the Kenmore housing market, one of my neighbors asked me who held the largest market share in the local real estate market. “That’s easy,” I said, “it’s Windermere!” The answer came out of my mouth before I even really thought about it. It’s a perfect example of how powerful branding and brand recognition is. Heck, I work for Keller Williams Realty which is the fourth largest brokerage in the United States. I’m proud of that, BUT, how much real estate is Keller Williams Realty selling locally? Well, curiosity got the best of me and I consulted one of my statistical databases. I limited my search to the percentage of combined sales (both listings and selling transactions) and the simple number of transactions by each company. Here’s what I found:

MARKET SHARE - THE WHOLE PUGET SOUND 2008

MARKET SHARE - KING COUNTY 2008

MARKET SHARE - KENMORE, WA 2008

MARKET SHARE - SNOHOMISH COUNTY 2008

It’s clear that Windermere is the dominant real estate brokerage in our market place; however, we can also see that “All Others” (meaning the total of many smaller brokerages) actually capture more of the market share as a whole. The logical question then is: “Isn’t Windermere the best brokerage in this area?” In the past decade, certainly, Windermere has been the dominant name in real estate. There has been an increase in the number of smaller brokerages (and the other larger competitors) that have been eating away at Windermere’s market share. It will be interesting to see how all of the dominant players perform in 2009.

Even though I am not a religious person, I had a chill of excitement run up my spine when I read the following on Politico.com:

“Though there is no constitutional requirement for the use of a Bible
during the swearing-in, Presidents have traditionally used Bibles for
the ceremony, choosing a volume with personal or historical
significance. President-elect Obama will be the first President sworn
in using the Lincoln Bible since its initial use in 1861.” (read the full article by clicking here)

Then this thought went through my mind: There is nothing more profoundly significant and powerful than the symbolism of Barack Obama, our first mixed-race President, putting his hand on the bible that Abraham Lincoln used when being sworn in as President of the United States of America. What could be more fitting? It will be a moment in history that proves we, the People of the United States, have come a long, long way. President Lincoln is truly “Speaking to the Better Angles of Our Nature” even today….in 2009.

BUT THEN………..I went down to read some of the comments on the blog post and the first commentator wrote the following: ICONIC HUBRIS. (the commentator identifies him/herself as a Republican). I have to say, my brief fantasy of our country coming together in these difficult times evaporated in an instant. It occurred to me that America has perpetually wrestled with powerful demons: racism, a starkly divided two-party political system, economic disparity, displacing native peoples, fighting one of the most brutal civil wars in history and many others. I had thought, perhaps naively, that most of us would be proud of our new President and that some wounds might be healed.

So, to purge the bitter taste from my mouth I found a copy of the Gettysburg Address and printed here to remind myself never to forget why history is important and why so many of us should go back and revisit it. It’s still as inspiring as ever:

Four score and seven years ago our fathers brought forth on this continent, a new nation, conceived in Liberty and dedicated to the proposition that all men are created equal.

Now we are engaged in a great civil war, testing whether that nation or any nation so conceived and so dedicated can long endure. We are met on a great battlefield of that war. We have come to dedicate a portion of that field, as a final resting place for those who here qave their lives that the nation might live. It is altogether fitting and proper that we should do this.

But, in a larger sense, we cannot dedicate, we cannot consecrate, we cannot hallow, this ground. The brave men, living and dead, who struggled here, have consecrated it far above our poor power to add or detract. The world will little note nor long remember what we say here, but it can never forget what they did here. It is for us, the living, rather to be dedicated here to the unfinished work which they who fought so nobly advanced. It is for us to be here dedicated to the great task remaining before us, that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion; that we here highly resolve that these dead shall not have died in vain; that this nation, under God shall have a new birth of freedom; and that the government of the people, by the people, for the people shall not perish from the earth.

If you are inspired to ponder the resonance of Abraham Lincoln, just click on the picture below which will link you to the NPR website of the American Icons Series. Here you will find several eloquent audio pieces well worth listening to. Enjoy