Better Homes & Gardens Real Estate, a national real estate conglomerate, has brought local real estate agency Real Estate III into its national franchise, they’ve announced in a press release. Their website has already been overhauled to reflect the news, being announced right now at an event at The Paramount. The company will travel under the name of “Better Homes and Gardens Real Estate III,” presumably a brief stop on its way to becoming, simply, “Better Homes and Gardens Real Estate.” Real Estate III was founded by Frank Kessler forty years ago. BH&G is acquiring for its network local real estate agents all across the nation, adding up to 125 offices in fifteen states. With the awful housing market, a lot of real estate agencies are hurting, making this the perfect time for a big company to gather up a bunch of comparatively small ones.
9:25 PM Update: The apparent marketing director for Better Homes and Gardens Real Estate III is insistent that they haven’t been sold, but won’t say what has actually happened. She would like you to know that I’m “obviously living la la land,” and suggests that they should “call their lawyers.” When she deigns to inform me of what this transaction is properly called, if not a “sale,” I’ll update this blog entry accordingly.
10:50 PM Update: Bryan McKenzie kind of explains this in Friday’s Progress. It’s still not clear what has transpired here, but my capacity to care is limited, so suffice it to say that Real Estate III has a new name, BH&G probably gave them some money, and they got something in return, but nobody’s saying what, and it involves entering into a franchise agreement with BH&G. I’ve updated this story to reflect that.
Website still looks the same as of 11:20 AM – did I get a cached copy?
You might hold down “Shift” and hit the “Reload” button in your browser.
FWIW, CBS-19 says that they weren’t bought, but “they’ve entered a partnership.” That may be true, but I don’t see any evidence of it, and it doesn’t seem logical. I think that’s just a euphemism for “got bought.” Their own website is “© Copyright 2008, Better Homes and Gardens Real Estate LLC,” and the press release “announced the addition of Real Estate III,” with Gaffney referring to BH&G as a “franchisor.” If there’s any sense that Real Estate III isn’t owned by BH&G, it’s in the same sense that a given McDonald’s might be owned by Joe Franchisee but, let’s face it, it’s McDonald’s. McDonald’s hasn’t “partnered” with Joe, since there’s nothing in any way equal about their relationship, as the word “partner” means.
Of course, I’ll update this story if more information becomes available that requires any correction on my part.
Tried Safari adn Firefox on the Mac. Still the same ol’ REIII web site with no mention of BH&G. Maybe this morning’s fiber cut is responsible?
Regarding:
“Real Estate III Bought by Better Homes & Gardens”
How about getting your facts straight before you write a story, Waldo? I don’t know why anyone would read your little stories when you are obviously living in la la land. Real Estate III is Real Estate III no matter how you slice it. Owners are the same, agents are the same, dedication to community is the same. Period.
Now that the fiber has been repaired, I do indeed see the BHG version of the site.
Seriously, get your facts in order. Perhaps link to a press release from the companies in question. Maybe a link to their websites. These baseless news items you toss off without any references are just silly.
What’s funny, Chris, is now he is posting the links to the actual press releases and he’s STILL got his facts wrong. Should Better Homes and Gardens Real Estate call their lawyers?
Those who say “nothing has changed” are looking at the realty brokerage business from the outside. Anyone inside who knows the field, and cares to explain the differences (I don’t), might add facts to the discussion.
I’ll note just one thing: Glenmore and other developments came to be from the owners investing RE III profits. Things like that don’t happen when owners live elsewhere.
Interesting that they were founded in 1970. The earliest Charlottesville phone book listing was 1972, as we all know.
Real Estate III was founded in 1972. Change is good…we must change in order to grow, but it isn’t the same as “bought” or “sold”. That’s my point.
Since Denise Hood refers to “we”, I assume that she’s, in some way, affiliated with Better Homes and Gardens, or Real Estate III, or whoever they are. Rather than just make derogatory statements about “little stories” or “living in la la land”, perhaps it would be more helpful if Ms. Hood could explain the facts to us? There was a press release announcing some sort of a change, so, presumably, this company wants the public to know that there’s something different about exactly how they’re operating. But, it’s just not clear what the change is. The nice thing about a community-based website like this is that knowledgeable insiders can help the rest of us of us understand the news. If only Ms. Hood would do so…
Sorry to be derogoatory, Harry. Please refer to any one of these sites for the real story.
http://www.newsplex.com/home/headlines/90218502.html
or
http://www.readthehook.com/blog/index.php/2010/04/08/re-iii-hooks-up-with-better-homes-gardens/
OR
http://rismedia.com/2010-04-08/central-virginias-largest-real-estate-broker-real-estate-iii-joins-better-homes-and-gardens-real-estate-franchise-brand/
OR
http://www.realestateiii.com
OR
http://www.bhgrealestate.com
ETC……
Ms. Hood, thanks for sending the links. However, I’m remain a little confused as to your initial reaction to Waldo’s post. I don’t see anything that directly refutes his claim that Real Estate III was purchased by a MUCH bigger firm. This doesn’t mean that your company will provide any lower quality service or that the agents will change, but it does mean that the economics of the business have changed. Perhaps you could shed some light as to what the agreement is between the two firms. In my experience this type of situation usually comes about with the smaller company (Real Estate III) getting a short-term gain (capital or infrastructure) and the larger company getting a longer-term gain (economics or access to increased market share).
A quick Google search shows that Denise Hood is the marketing director for Real Estate III and also runs her own company, Creative Juices.
Ms Hood, as a former exec in the marketing and advertising world, let me offer you a word of friendly advice. When you come across a story employing neutral and well-measured wording– like Waldo’s entry above– it’s not a smart or effective marketing strategy for you to start posting as though your pants were on fire. Unnecessarily snotty verbiage such as “little stories” and “Should Better Homes and Gardens call their lawyers?” makes you look like a reactionary hack. Then you swoop in at the last second with a mild closing “That’s my point” even though no one posting here suggested the customer service would be better, worse, or remain the same.
When I see an overreaction like yours, I immediately think: “Hm, what’s REALLY going on here?”
Creative Juices. Duly noted, and duly deleted.
If I recall, Denise Hood is/was the Marketing Director for Real Estate III. So, she should have all the facts if she cares to share.
Yeah. Until Denise jumped into this thread, my thought about the merger/take-over/new friendship b/w RIII and BHG was “huh, interesting.” NOW, though, my take is, “I bet I can find less hysterical and reactionary people to give my money to when buying/selling in Charlottesville.”
Cecil – you crack me up.
My initial reaction to the story was indifference. Now I feel bad joojoo all over the place – especially when the angry person is not only a real estate agent, but runs a local marketing firm. Isn’t she supposed to at least to pretend to be friendly and happy?
So, read all of the pieces that Denise linked to and I still don’t get what’s going on. I know that Real Estate III now has a new name, but what else is going on? I see words like “partners” and “joining forces”, but that doesn’t tell me much. Lisa Provence says, in the Hook piece that Real Estate III “has joined the Better Homes and Gardens Real Estate franchise”. What does that mean? Did Real Estate III buy a franchise to give them leads, marketing support and organizational structure? Is it like buying a Subway sandwich franchise? Is there some change in who holds the equity in the company?
Generally, this sort of thing is nobody’s business but that of the company involved. They don’t have to tell anybody about their private business dealings. But, in this case, it seems clear that the company wants the public to know that something has changed. Otherwise, they wouldn’t have issued a press release. But, beyond the name change, they haven’t provided any information to us. Please, Better Homes and Gardens/Real Estate III, if there’s something that you want us to know, just say it clearly. If it’s none of our business, just hold off on the press releases.
I find it fascinating that there isn’t a single comment about the Blue Ridge Parkway shooter being arrested, but one snarky comment (and it was snarky) lit this thread on fire.
(And yes, I haven’t commented on the BRPS story, either.)
I have to admit, I’m a bit baffled by this. Denise e-mailed me in mid-afternoon (but didn’t disclose whether she had any relationship with Real Estate III, and used a generic Earthlink e-mail address—I figured she was just some random woman) saying that this blog entry was “completely false,” and attaching the very press release that was the source of this blog entry, that I’d already linked to from this blog entry from the get-go. (Despite two assertions to the contrary that I see here.) I wrote back pointing out that I couldn’t have gotten everything wrong, and “if there’s something specific that I wrote that is incorrect, please tell me what it is, and I’ll be happy to correct it.” She wrote back saying, simply, that the word “sold” is “completely false.” So apparently that’s the only word here that’s incorrect. I responded, asking what the reality was (if not “sold,” then what?), but I haven’t heard back, so I’ve got nothing better to write than what I’ve already written here. If I had more information, I’d report it, but I don’t.
(Note that WCAV and NBC-29 initially reported that Better Homes & Gardens had bought Real Estate III before changing their language to the nebulous terminology that I gather Real Estate III prefers—words like “partner” and “relationship”—so I’m hardly the only one to read their press release and come to the conclusion that they’ve been bought.)
Helping nothing, Denise’s comments here have been awfully rude. If she’d been nice, I might have just changed the wording and not really cared, but now I’m annoyed, and I want details. What’s particularly alarming is this:
I’m not sure, but I think Denise—that is, “Better & Homes Gardens Real Estate III”—just threatened to sue me for promoting the business news that they’re so eager to share with people, but getting one word wrong…but she won’t tell me what the right word is. This is not good marketing.
So, for the public record, I’ll repeat what I told Denise via e-mail: It’s fine to say that it wasn’t sold, but for me to correct the story, I have to say what *did* happen. Help me understand what Real Estate III has given up in exchange for money from Better Homes & Gardens. I never want to write anything that’s incorrect, and one of the ideas behind these comments is to allow people say when I’m wrong. So correct me, Denise. Tell us all what’s really going on here. Please.
http://www.linkedin.com/pub/denise-hood/B/482/8A
Denise Hood
Denise Hood
Marketing Director Real Estate III and Director Creative Juices
Charlottesville, Virginia Area
Seems to be more than apparent Waldo. Public Linked in Profile is at the above link.
I don’t know why this got so off track, my own concern would be if people in our community are going to lose jobs in this “partnership” or “buy-out”. I hope they won’t because this is a very tough job market for everyone.
Waldo,
I have no affiliation with RE III. I’m just I guy. Based on the links you posted in the article above, it looks to me like you just interpreted this wrong.
The BH&G website says RE III joined their franchise network. McD is not the only franchise out there. Donut shops and gas stations can also be franchises. Often the franchisee (that would be REIII in this case) pays a fee (they don’t get any money from the franchisor) in order to use the franchise brand, get access to some of the franchisor’s resources, maybe get some branded products, etc. The franchisee remains separate with original ownership, and the relationship may be terminated in the future, by either party.
To me, that’s the most likely explanation, not some big conspiracy or cover-up of a sale.
That explanation makes a lot of sense, John—you may well be right about it. Would that Ms. Hood could have spelled it out so clearly (or nicely!) If you were interested in a job in PR, I know a growing real estate firm that could use your help. ;) Given that you have no affiliation with Real Estate III, I hope you’ll understand that while I regard your explanation as quite possibly correct, I don’t care to compound an error with another one, so I’ll await information either from Real Estate III or, more likely, from tomorrow’s Daily Progress, so that I can get this story right.,
Luckily, the Progress has a story after all, and while it still doesn’t really explain things, it’s close enough, and more detailed than my capacity to care. I’ve updated the story here, and as is my habit, I’ll document the before-and-after. Here’s how it originally read:
The story’s URL remains “real-estate-iii-bought,” because otherwise I’d break all of the links to it, meaning that folks couldn’t even come back to see these corrections.
Good that people probably won’t lose jobs. And that’s the limit of my interest right there. :). Wasn’t there a shooting or something? And how does a 56 year old man fit the profile of a random killer? Very strange.
FlyingRoadstar wrote, “I find it fascinating that there isn’t a single comment about the Blue Ridge Parkway shooter being arrested, but one snarky comment (and it was snarky) lit this thread on fire.”
There’s not much to say about the BRP suspect being caught, except for “yay!” But who can resist chiming in on this story about Denise teaming up with Better Homes and Garden Real Estate III to sell homes in La-La Land?
Is it just me, or is “Better Homes and Garden Real Estate” not a TERRIBLE name for a realty? That’s just awful. It makes me think of the most boring magazine in the world, the one you see lying around the dentist’s office, with bad recipes for Jello-mold desserts in the back. I do not think of these people as being hip-and-happening when it comes to seizing the attention of the 18-36 “echo boomer” real estate consumer group.
Denise, if that’s how the new BHaGREIII wants to deal with people in this small town of ours, then I say good luck. Me, I always talk to Bob. That’s because although it’s been more than 10 years since I’ve done business with him he always has a smile and stops to talk to me whenever I run into him. That’s how a community is built, one friendly, civilized interaction at a time.
I notice that we didn’t hear much from Denise after she got outed.
Funny that she came on here trying to make her little public relations point and ended up accomplishing exactly the opposite.
I’m glad you mentioned that—because, yeah, that’s been my experience, up until now. I don’t often write about business news here, but Real Estate III is a big deal in town, they’re rightly respected, and my interactions with them have all been good. Or, at least, had been. I’m trying to convince myself that this woman is the exception to a rule there, and that she doesn’t actually represent them very well in this instance.
Oh the irony of it all… a local company merges with a big national firm to help them better exploit the benefits of using social media- and in the very first example of them using social media as this new entity they trip all over themselves in doing everything you’re not supposed to do- alienate potential customers and engaging in confrontational style debate.
Wow, this Denise Hood woman is extremely rude and condescending. I see that she is the marketing director for Real Estate III / Better Homes & Gardens / McDonalds.
Perhaps, Denise, you do not realize that everyone who is everyone in Charlottesville reads this blog and has for years, and that you have just insulted (and toothlessly threatened) one of the more influential people in Albemarle County. You just dragged your brand through the mud on a blog that thousands of people read in the middle of a crucial transition for your company. Bravo. We’re all pointing and laughing at you.
Denise, that’s some nice marketing there. Really diplomatic. I’ve got 6 acres in Keswick that I really would not mind putting on the market when the new NGIC center is more fully staffed and you guys now do not have a prayer of getting that listing.
Oh, and it backs up to Castle Hill. So nyeah.
Hey, this is potentially even funnier and more of a failure than I had initially realized.
The comment from ‘Chris’ at 2:20 pm looks suspiciously like a sock puppet to me. Can Waldo please check the IP address for that comment and report his findings?
This whole thing is quickly going from ‘eye roll’ to ‘rofl.’
I was intrigued by the name of the President & CEO of Better Homes and Gardens Real Estate as quoted in the linked Daily Progress article. Especially as to how it relates to Jack’s point above.
I wonder how long before this entry gets on the first page of returns when you Google “Denise Hood”. It’s already the 4th hit when you search for “Denise Hood” and Charlottesville.
This could be a case study.
Jack,
You seem to be displaying the same pent-up fury that resulted in Ms. Hood’s snideness. What’s it to you that she made a fool of herself or that she dragged her ‘brand through the mud’? Is watching someone else commit an embarrassing gaffe really so entertaining to you?
Whether or not ‘everyone who is everyone’ reads this blog or that ‘thousands of people’ are reading these comments (doubtful), there has already been an adequate response to her faux pas, has there not? I’m now wondering if YOU have some stake in this story or indeed in Ms. Hood’s personal life?
Waldo, I would respectfully request that you do not check “Chris’s” IP address or, if you do, that you do not report your findings. Or, if you do report your findings, let us know who Jack is as well. Hell, start reporting everyone’s IP address! As I understand it, Cvillain.com started reporting partial IP addresses a while back…..
I’m starting to feel sorry for Denise. She made a big mistake but maybe we can forgive her and let it go? And certainly not blame the whole company for one person’s embarrassing gaffe? Haven’t we all at one time in our lives written an email or a comment that we later wished we didn’t? I don’t know, I have no stake in this at all but it does begin to feel like ganging up on someone who has withdrawn and is probably feeling very bad about what she wrote by now. I’m sorry I put up her linked in profile now. Waldo can you take it down? Or if not maybe we could move on? I have made comments myself I will say in the heat of the moment that I wish I could take back….Maybe it’s the Easter season but I’m starting to feel bad about this…..
My initial comment was intended to be dripping with sarcasm. Each item I “called” on Waldo to include in his story was, in fact, included in his original post. Alas, I was apparently not entirely effective in this effort.
Lessons learned:
Sarcasm rarely works on a discussion/comment board unless the people involved actually know you personally or are very familiar with your writing style
Cuff your hands before posting anything inflammatory or rude. Better yet, write it down on paper first and then type it if you still think you must.
The internet doesn’t forget – even if everyone else does.
Beware The Google.
Why no mention of the natural link to this story and the Comer malfesence at Glenmore? There has to be a connection imho. Mrs. Kessler’s home is for sale, Glenmore CC is allegedly for sale, it only makes sense that REIII needed to be sold too. Not sure why this is such a big deal. Some agents will stay, some will go, that is always the case. Realtors move their licenses all the time. I find when dealing with REIII it is no different than any other agency.
Alison Hymes, you are a good soul.
Good afternoon Mr. Jaquith. I am a public relations person who represents Better Homes and Gardens Real Estate and was the chief author of the press release: Central Virginia’s Largest Real Estate Broker, Real Estate III, Joins Better Homes and Gardens Real Estate Franchise Brand.
The announcement covers a long-term franchise agreement between Better Homes and Gardens Real Estate and Real Estate III. Better Homes and Gardens Real Estate is a franchisor, and all of our affiliated companies are franchisees. We have no ownership in any company nor do we plan to have any in the future.
Any reports to the contrary in the media are inaccurate.
Jim Gorman
Managing Director
Kwittken & Company
Whatever you call this transaction, my inclination would be to NOT use Real Estate III based on the snarky and demeaning comments from Denise Hood. A local blogger talked recently about “social media spankings.”
http://www.marijeanjaggers.com/2010/02/10/five-ways-to-avoid-a-social-media-spanking/
Maybe Real Estate III needs to begin to learn that lesson…
Thanks for pointing that out, Chris. :) I don’t mind anything that this woman has to say about me, but coming from a long-time, regular reader who I know, like you, I was starting to question my sanity!
Alison, I think your instinct is a very good one, and, as Crozet Resident said, it speaks well of you that you feel like this. (It helps that I’ve gotten to know you—and many other people who have participated on cvillenews.com—in person over the years, too!) But you can’t put the genie back in the bottle, w/r/t removing the link, and I imagine somebody else would just repost the link afterwards, and anybody could google it. However, you’ve inspired me—
Given the straightforward, informative comment from Mr. Jim Gorman, and what I anticipate has been an unpleasant day for Ms. Denise Hood at work today, I think it’s fair to say that there’s probably nothing else to be said about Ms. Hood’s work. (Especially given the very funny and insightful comment from “Just saying…” about social networking. :) Suffice it to say, I reported something incorrectly, Ms. Hood reacted rudely, we’ve pointed out that she was rude, and the proper information was made available to people. All of this transpired in less than twelve hours, and no harm has been done, I hope. Lessons have been learned all around, I imagine, and that’s the important bit.
Yes, the lesson for today is “the smaller the actual problem, the bigger the brouhaha”.
I’ve written a post, Five Steps BHG Real Estate III Should Take Right Now http://www.marijeanjaggers.com/2010/04/09/five-steps-bhg-real-estate-iii-should-take-right-now/ as a follow up and to provide some advice in digital communications strategy to a company that seems to need it. Glad for everyone’s thoughts on this today — it helps keep the social web a healthy, accountable place to do business.
jeezohmannnn….
I’ve made a post in my mental blog: “5 reasons why Denise Hood should be burned at the stake right now”
after I put down the bong, I might get around to thinking about committing the reasons to paper…..
Good grief, folks – take a collective deep breath and tone down the hysteria. Better Homes & Gardens has been buying up small, private RE firms in other parts of the country for years now, and so far the world hasn’t come to an end. This like a much smarter move for RE III than potentially going out of business, doesn’t it?
Given your prior post on this thread, I can only assume that this is sarcasm. I don’t doubt that you mean to convey a) that people are overreacting and b) that Ms. Hood is being metaphorically burned at the stake here, but I’d hate for somebody to be skimming this thread and not appreciate that context.
So, for the record, even metaphorical threats of violence against people can be very frightening to those people, and are potentially actionable. Ms. Hood’s had a bad enough day as it is—nobody wants her to be fearful of her well-being. And, FWIW, while I don’t (to my knowledge) know you personally, I know your history of comments here, and I know you to be a reasonable, thoughtful person, and I’m sure that you didn’t intend to scare anybody.
yes, pure sarcasm; but you’re right. It’s late on Friday and ’twas merely an attempt at humor… I thought it was damn funny!
Maybe it should have been, “5 reasons why *some people* missed beating the horse while it was still alive….” Not to advocate for violence against farm animals you understand……
I read Marijean’s blog.
She didn’t use the word “closure” but excuse me while I disgorge into the porcelain just the same.
Comprehensive coverage of the Glenmore / Michael Comer scandal to date:
http://realcville.blogspot.com/2009/12/case-to-date-michael-comer-embezzlement.html
Dr. Truth, I was more like “you’re giving this woman a hug with one arm and hitting her in the face with the other”. I guess she was well intentioned but she sure made DH’s day and weekend much worse by putting up that post. A little bit like “bless her heart” if you know what usually comes after that start to a sentence……
I’m not reading through all the other comments So If I duplicate something already posted. Well I duplicated it. Next.
Now onto the point I wanted to make.
The only advantage that RE3 gets from the BH&G ownership would be that with BH&G as a national agency.. it just got tons easier to market the million dollar plus properties that no one can afford locally.
And not that it matters one whit… But in my opinion RE3 is such a corrupted organization to begin with that this purchase cannot seriously affect it negatively.
Denise, If you view Waldo’s blog as “I don’t know why anyone would read your little stories when you are obviously living in la la land.” then why send him your “press release”?? And two if you are in face a “partenership” and still the “same” RE III then why threaten to get the Better Home and Gardens lawyers involved and not the staff of RE III lawyers that you all employee.
Most locals know to stay away from RE III, for too many reasons than I care to waste my time writing. This “partenership” will change nothing. And your nastyness shows why most local people do not like or use your company and why your firm is not as strong or popular as it used to be.
I hear that BHG will take 8% of all commissions, but I’m sure it is more complicated than that.
>
Dream on that folks with money will flock to CVille to buy multi-million dollar homes. As an investment they are better off buying in NYC, the burbs of CT or Northern NJ. There’s a big credit crunch even on the high end of the market. Rates are rising and we will see another big leg down in 2010 and 2011. The deleveraging process will continue as rates rise. A new class of debtors will be forced to sell.
For those of you that own homes brace yourself for a long wait and those that own condos will not really be able to sell unless you slash 50-70& off your unrealistic asking prices.
If you don’t believe me ask all those who held on to their Nasdaq stocks for more than 10 years. Look at home prices paid in 1986-87 and then again for the same homes in 1997. Most were barely at break even or still underwater.
No expert at all, but 70% cuts seems a little bit high, do people really think they can get a decent one or two bedroom condo for say $40,000 to um, not good at the math, but maybe $75,000? In Charlottesville? Especially if it’s in a prime area and people are less likely to be able to afford houses. Maybe they will all just keep renting and you are right but I suspect that there will always be bargain hunters in this market and that they won’t be able to get condos for as cheap as they think, know someone who tried that and got turned down, suspect a lot of folks are going to find out that most people not in default won’t go that low and would rather rent out and rent somewhere else than do that. (Meaning people who have to move for a job or even move for health). Well we’ll see but I think as things get worse more folks will let go of their dream of a house as the only way to go….happened in another city years ago and now those condos have gone way up, go figure…….
The reason I say condos will be hit is because it’s very difficult to get a mortgage on a condo today. Look at the recent prices in the JPA condos. Shorts sales/foreclosures have seen 50% plus reduction in actual sale prices vs. the 2006 highs. You can still get an FHA loan with 3.5% down in that complex. Imagine the reduction if it were only cash deals. How many people have $100k in cash or even $50K?
Denise – meet Marijean. Maybe you two could join forces and take the world by storm. Be sure to hire a social media coach and carry a big paddle for the spankings.
@Humpster, when you say “still get an FHA loan” in JPA condos, are you saying there is a time when you won’t be able to because the upper limit for FHA loans seems to be much higher than what JPA and many condos are advertising for right now? Sorry to be obtuse, but it seems as if people who qualify for FHA will be able to buy many condos in C’ville and Albemarle at current and even future prices for quite a while. Why would someone go for a cash deal if they could get an FHA loan? But while we’re at it, I looked at Real Estate Three’s website and those of the condominiums they sell, very out of date on at least one and will scare buyers away with prices that aren’t real and make no sense. Also no link to financing/mortgate on that one. They are doing a very bad job of selling right now so maybe it is a good thing that Better Homes is taking over after all. If you can’t have an accurate and useful website and don’t bother to update it, well you really don’t know what you are doing do you?
Humpster isn’t speaking out of his proverbial a$$ets, he knows his data when he discusses prices and values dropping (he comments on bubble blog, too). If you pay “asking price” for anything in the Charlottesville area right now, you’re most likely immediately “underwater”–you’re owing more than the place is worth. And with many condos, you’re signing on for bleeding cash.
This isn’t a major metropolitan area, it’s a college town. Reality is setting in….
FHA info: http://www.fha.com/
Go to yr local bubble blog for area info, and to
http://www.patrick.net for nationwide housing info
http://www.calculatedriskblog.com for housing/finance
@Wondering!
>
Sorry I probably wasn’t as clear as I should have been. There are many condo communities that do not qualify for FHA loans and hence it makes it very difficult for sellers to sell. My reference to JPA was that even with FHA loans some of the actual sale prices are as much as 50% off the highs. So now imagine what those condos that don’t qualify for FHA loans will have to shave off their prices to conclude a deal.
>
I absolutely agree with you that the prices for the higher end condos are fictitious and totally unrealistic. As for the link to financing I suspect this is because you cannot find financing for the more expensive condos. Unless you have a really strong balance sheet and have your own source of financing (ie strong personal banking relationships) you will not find third party financing.
I think the brokers know that the owners/sellers are drinking koolaid and smoking something really strong. But it’s a listing, and they will do what it takes to make a deal close. Unfortunately for them it’s not going to happen until the owners wake up and smell the coffee and realize they will have to slash their asking prices to find real buyers.
From Robert Shiller in the NY Times: “Don’t Bet the Farm on the Housing Recovery”
4/10/2010
dubdubdub.calculatedriskblog.com/2010/04/shilller-dont-bet-farm-on-housing.html
70% is not too far off for secondary locations. 4 BR units at Eagles Landing sold for $259,900 in 2007. You can pick one up (along with outrageous HOA fees) for about $90k- probably less. That is a 65% decline.
Prices will continue to fall for condos and townhomes, especially in the county. Sure, the converters may be able to sell a few units per year at slightly discounted prices, but even then their sell out period will be 5 years maybe longer (Hessian Hills was about a year). They will have trouble holding that long- especially with higher interest rates. It is not about “at what price can I sell one unit” but rather “at what price can I sell 40 units per year”.