Continuing the tradition that started when the earth was young (or last year… depending on your definition of “time”), I’d like to present this year’s version of “Predictions Guaranteed to be Wrong, Or Your Money Back”! As we saw in the report card post, last year, I went 4.5 for 7 in predictions. I hope to bat lower for this year’s predictions. Of course, I can guarantee 0 for 7 by making ridiculous predictions, like “The Jets will win the SuperBowl”.
In 2009, I batted .600 in predictions for 2010. And I thought that was fun. It’s one thing to make predictions; it’s another to look back and see how those predictions fared.
How did I do last year in predicting events of 2011? I was hoping to be maybe 1 out of 7, since most of my predictions last year were of the doom-n-gloom variety. Sadly, I think I’m 4.5 out of 7 for a .642 batting average. Hall of Fame (Infamy?), here I come.
We’ll review my take on the predictions for 2011 after the jump.
By the way, I’m really, really liking Prezi. I expect to use it from now on for all presentations. Amazing that a web app is better than even Keynote….
Last week, at the Inman Connect conference, I got into a rather interesting — if dry and technical for non-lawyer types — discussion with Brian Larson about whether MLS could escape being classified as a public utility. I’m not going to go into that, since that discussion tends to have a lot to do with issues like anti-trust exemptions, regulation, various legislation throughout the years, etc.
Instead, let me ask a patented Notorious Dumb Question.
Why should not the MLS be a public utility?
Right now, I can imagine the readers of this blog divided into three groups. The first group is smiling acidly in incredulous bemusement, because they know what the hell it means for a MLS to be classified as a public utility. “You just don’t get it,” I can hear them say. To which I say, read the whole post, coz I think I do get it. The second group is going, “What the hell does that mean?” And the third group has already hit the BACK button. See ya!
A mere six days ago, NAR’s Chief Economist (and my doppelganger) Lawrence Yun released this cheery video forecast on housing for the remainder of the year:
Lawrence is predicting a slight pickup for 2011 over 2010; he thinks the second half of this year will be better than the second half of last year. New home sales will still be hurting, he thinks, but existing home sales should improve.
He based this forecast on the idea that the employment picture was slowly improving, as seen in this video:
Lawrence says he thinks we’ll see 1.5 million new jobs in 2011, maybe a little less. But “at least we’re not losing jobs, and losing potential for housing demand”. He thinks we’re on the right track, albeit slowly.
So he’s thinking 1.5M new jobs this year, 2M next year.
Well, the latest job report is dismal, even grim. The official government report was that only 18,000 jobs were created in June, way, way below the expectations of economists of around 150,000. Furthermore, the news is even worse than it seems.
Ah, but there is a glimmer of hope, it seems… read on for more.
Apparently, some legislators in South Dakota are pulling a political stunt by introducing a bill to require that all adults buy a gun upon turning 21. I say it’s a political stunt because the whole point of the exercise apparently is to say that Obamacare is unconstitutional, just like a an individual mandate to buy a gun would be:
Rep. Hal Wick, R-Sioux Falls, is sponsoring the bill and knows it will be killed. But he said he is introducing it to prove a point that the federal health care reform mandate passed last year is unconstitutional.
“Do I or the other cosponsors believe that the State of South Dakota can require citizens to buy firearms? Of course not. But at the same time, we do not believe the federal government can order every citizen to buy health insurance,” he said.
Well, what I find really disturbing about this is that a frikkin’ state legislator is so ignorant of the Constitution that he can make statements like this. We need to bring back civics education and do some sort of teaching on basic, fundamental constitutional law. Our nation is starting to suffer because of the low level of knowledge and education on the part of the citizenry on the most fundamental document that governs our political lives: the U.S. Constitution.
Since not everyone who reads Notorious checks out my blogging on 7DS… I’d really like your thoughts on my last two posts. They’re scaring the crap out of me, and I’d love to get any counter-arguments or counter-evidence.
Ted Williams: .406 batting average in 1941. Me: .600 in 2009. Sorta...
Coming off of an awesome, Hall-of-Fame type of year in which I batted .600 in predictions (or, alternatively, a year in which I only got 6 out of 10 predictions even remotely close to right, and hence am a big #FAIL), I thought I would don the Nostradamus hat once again and make foolish predictions for 2011. I know I should make 10 predictions, but… y’know, I’m sort of stuck on that number Seven.
Here are seven predictions for 2011. Many are guaranteed to be wrong, or your money back! But as a bonus, each prediction comes with a music video for your entertainment.
[Warning: don’t read this is you’re feeling happy and optimistic, and you want to stay that way. I’m personally feeling happy and optimistic, but as I put this together, I can’t help but want to reach for strong drink for the industry as a whole. I know I tend towards bearishness, and some might suggest, alarmism, so… I’d suggest you go read some other 2011 predictions posts as well. Here are a few I’ve seen myself: Lani on Agent Genius, Greg Robertson on VendorAlley, and this whole series over at Inman.com.
A couple of weeks ago, I wrote that if you have a REO or short sale practice, you want to pay attention to some legal cases going on around the country:
Trouble is, MERS might lack legal standing to bring a foreclosure action. At least, that’s what the attorneys for the homeowners who are getting foreclosed are claiming.
Given that so many mortgages were packaged into securitization pools (RMBS), sliced and diced, with different investors taking a different piece of a few hundred thousand pooled mortgages… it really isn’t clear who actually owns the mortgage, and has the right to enforce its terms by foreclosure (or have its duly authorized agent/servicer do it).
I noted then that this seemingly esoteric legal issue is a thermonuclear landmine for the entire foreclosure and short sale industry, including real estate agents who represent buyers and lenders.
Well, Congress has been holding hearings on problems in the foreclosure industry. I haven’t seen too many media coverage of the hearings. This blogpost on Washington Post is one of the few I could find. I just spent valuable two hours of my life watching CSPAN video of the hearing on December 15, 2010, which is embedded above.
This topic is just too big, even for my lengthy posts. But if you have anything to do with foreclosures, REO’s, and short sales… I would suggest you spend some time looking at this issue.
Men, they're coming for the mortgage interest deduction! This means war!
NAR has finally gone to the mattresses over Federal policy. Some time ago, I wrote that the mortgage interest deduction may be phased out or limited as part of Obama Administration’s new “sustainable housing” policy. At the time, I’ve heard quite a few people say, “It’ll never happen”. The thought was that the public loves the MID so much, they feel entitled to it, just like Social Security and Medicare. Plus, NAR is such a powerful political operation that no politician would ever dare touch the MID.
Well, the White House Deficit Commission unveiled its recommendation today, and guess what? The MID is most definitely on the table for outright elimination or significant limitation. From Housingwire:
Of the many proposals inside the document, the most contested one for the housing industry will be the mortgage-interest tax deduction. The commission proposes for the deduction to be limited to principal residences only and that eligible mortgages be capped at $500,000 instead of the $1 million current cap. The commission also proposed a 12% nonrefundable mortgage-interest tax credit for all taxpayers.
As expected, NAR criticized that part of the report, suggesting that eliminating or limiting the MID would cripple the housing market, drag values down another 15% or so, and so on. Investors who have been coming back into the market, at least for foreclosures and short sales, might need to redo all of their financial models based on the tax subsidy for mortgage interest not being there anymore. Buyers will need to redo their rent-vs-buy calculations. All sorts of bad things for housing, at least in the short-term, will come about.
Then earlier today, I see that NAR has put out a Call to Action to its members to call their Congresscritters to defend the MID. This is merely the opening battle, so how this issue gets resolved should signal how the rest of the Housing War of 2010-2012 will go.
The second group is going, “What the hell does that mean?” And the third group has already hit the BACK button. See ya!
