It’s All in Perception

by jhwygirl

Bitterroot Realtor Craig Siphers isn’t hiding the truth – at least in his interview with Perry Backus of the Ravalli Republic.

The housing market sucks.

It’s all relative, really – but the bottom line is that it sucks.

Now – of course there is going to be stories that say that the housing market is doing fine, and that it is rebounding – but that’s about creating the perception that we’ve hit the bottom.

Time to buy that house now before prices start going up! That’s what the housing industry wants you to believe.

And the banking industry and the mortgage brokers and the banks.

Of course the market’s rebounding….by every measure except foreclosures.

Yeah – those pesky foreclosures….

Locally, here in Missoula, things are pretty bad. Realtors are taking on jobs. Mall jobs. Prices are actually being cut. Usually you rarely see price drops of the scale we’re seeing in new units – new units that have been on the market and new homes coming on the market because builders kept building last year even though all indicators were that things were going to get real slow. Used to be that you’d see free TV’s, free BBQ grills, free anything before you’d see drops in prices.

I know of one development here that is selling new units at lower prices than a whole bunch of units that they’ve sold over the last 3 years. I know of another condo project, usually pretty desirable, that’s have several units on the market now for more than 6 months…and that’s with prices that have been dropping

Need more “perception based” reality? How about last month’s story on foreclosures?

The story starts off with “Compared to other parts of the country, particularly Arizona and California, Montana doesn’t have a high rate of home foreclosures.

So of course, its all relative. Keep in mind that both Arizona and California have whole metropolitan areas with populations larger than that of the entire state…but, Montana ain’t that bad. Remember that and buy buy buy. Now.

Here in Missoula, 33 homes went to Sheriff’s sales in June. January through May, it was 8 to 10 per month.

Current info on, for Missoula, shows 4 Sheriff’s sales listed, 26 in foreclosure status, and 33 in pre-foreclosure. 51 in bankruptcy.

Statewide, that same website is showing 78 in Sheriff sale, 215 in foreclosure status, and 311 in pre-foreclosure. 398 in bankruptcy.

There’s an adage in the housing market that says if you aren’t under contract by the middle of the summer, either drop the price or be set for a long, long haul. Many are currently facing that dilemma. It’s August.

Thing is, this is painful for some. It’s especially painful for those wanting to “buy up.” It’s unfair to have watched everyone else buy and sell in 5 years or so and make such handsome equity. If you are wanting to sell, or hoping to do so sometime in the near future, you’re kinda screwed.

But..if you are a potential buyer? I figure you’re good until next spring, at least. Better off to save more towards downpayment while prices continue to drop and inventory continues to rise.

Besides that, who wants to move in this heat?

Where does the blame lie? Is it in the mortgage brokers that overextended credit, making easy money to both purchaser and sellers? Making prices large? Is it in the sellers and Realtors that increased prices on homes at a faster pace than what was realistic? Is it in the buyers fault for taking that crack cocaine when it was offered?

Do you blame it on the crack dealer or the crack addict?

We’ll be left to ponder that for years…in the meantime, keep in mind, the housing market is all in the eyes of the beholder. Buyer or seller, Realtor or mortgage broker.

  1. Lizard

    i tend to place the bulk of blame on wall street. they brought the crack to the ghettoes, and sold their banker underlings a get-rich-quick scheme based on “exotic financial instruments” which spread like a venereal disease.

    if banks had just done their jobs, this housing bubble would never have happened. if they had sold rational mortgages to people with provable incomes, then kept those mortgages on their books so they had actual incentive to lend responsibly, we wouldn’t have people upside down in homes with grossly inflated pricetags.

    instead these savvy junk pushers “monetized” then chopped and bundled “subprime” mortgages and peddled them with the triple-A blessing of rating agencies and, more importantly, beneath the grand fiscal overseer that was supposedly created nine decades ago to keep markets stable: the federal reserve.

    and, predictably, these financial terrorists are positioning themselves for the next scam with our money. it’s like weekend at bernie’s; they just dress up the corpse and continue partying like nothing happened.

  2. Ryan Morton

    Yeah, people should spend less time guessing about the market and more time asking their lender if homeownership is realistic for them – personally.

    For those with homes who want to move, is the potential gain or loss in equity (risk) worth the sacrafices in quality of life of staying put?

    Guessing “the market” is a crap shoot. It’s better to figure out your personal situation first based on your personal circumstances (facts).

    Also, foreclosures and bankruptcies aren’t necessarily indictative of the housing market. A leading cause of bankruptcy is health care costs. The foreclosures could be a residual effect. It’s hard to tell.

    The foreclosures could reduce appraisals, but that’s another issue altogether…

    We do know that subprime loans were not extensive in Missoula and most of Montana (but the aftermath of the areas that did have significant subprime lending created stricter rules for everyone).

    Oh, the complexity hurts!

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