Warren Watch - Home prices set to fall
Regular readers know that I keep tabs on a number of local journalists that I've tagged as being industry cheerleaders. These journalists routinely write puff-pieces praising real estate and urging people to buy without regard to caution. One of these cheerleaders is journalist Warren Boroson.
Here is his most current piece:
Author: Home prices set to fall
There I was, bopping through the aisles at a Barnes & Noble, when what do I see?
A book called "SELL NOW! The End of the Housing Bubble."
The publisher is a respected name, St. Martin's Press. Copyright 2006.
So I bought it. And read it.
A strange book.
...
The author predicts that house prices will fall off the table, returning to their 1997 levels. All over the developed world.
Houses in New York and northern New Jersey will lose 44.6 percent of their value, falling from an average of $454,522 (in 2005) to $252,028 during the next five to seven years.
...
Anyway, my response is that people pay a lot of money for houses because houses are nice. You become the king of your castle; by paying down your mortgage, you own more and more of that castle -- instead of making your landlord richer.
Yes, it's clear that house prices in some areas are softening now. And maybe some people would be better off selling. But what a hassle!
...
And he may turn out to be totally correct, although I doubt it.
But if he's right, he will have made a self-fulfilling prophecy. If everyone who reads his book does what he advocates, the real-estate market will indeed be in serious trouble.
--------------
Now, after you've read the article (or the highlights I've posted here). Take a look at this piece:
Is it time to cash in on your home?
Who else might want to seize the opportunity to take profits? Anyone with more house than they really need. Warren and Rebecca Boroson bought their Glen Rock, N.J., home 29 years ago for $69,900 and raised their two sons there. But now, says Warren, "our children are grown and out of the house. We had four bedrooms, which is three more to mess up than we needed." Last year the Borosons sold for $579,000 and moved to a high-rise apartment in Hackensack, N.J., with a doorman and a swimming pool. [a rental]
"We sold mainly to lock in the profit," Warren says. "It was a little faster than we’d planned. But if you’re planning to sell in a few years, you might as well do it now while you’re sure the market is still good."
Warren writes a financial column for the Morris County, N.J., Daily Record that is syndicated nationwide. With an eye on retirement (he’s 69), he invested his cashed-out home equity in a laddered portfolio of bonds.
-----
I have a bit of concern with one small piece of the article, I'm not sure if it's just the way I'm reading it, but it comes off as a slam against the book's author, John Talbot.
By the way, the author is someone named John R. Talbott. He is identified on the book's back cover as a best-selling author (he wrote another book, called "The Coming Crash in the Housing Market"), was a visiting scholar at UCLA's School of Management and was an investment banker at Goldman Sachs.
Whether he has any real-estate experience, whether he graduated from college and whether he has any advanced degrees is not disclosed.
This really seems like a below-the-belt slam against Mr. Talbot. A quick search on the web finds the following bios:
John R. Talbott is an economic consultant who has authored academic papers on economic growth and development and made presentations on the subject to the governments of Russia, Jordan, and Qatar. A visiting scholar at the Anderson School at UCLA, Talbott is also a former vice president in the investment banking division of Goldman, Sachs, and Company.
Here are two of John Talbot's academic papers:
The End of Class Warfare: An Examiniation of Income Disparity
Political and Economic Freedoms and Prosperity
Not sure why a journalist would make such a rash assumption about someone's education and background and not just do a little leg work to find the real facts. I suppose that if you can't argue the facts, resorting to insult is the next best thing...
Caveat Emptor!
Grim
Here is his most current piece:
Author: Home prices set to fall
There I was, bopping through the aisles at a Barnes & Noble, when what do I see?
A book called "SELL NOW! The End of the Housing Bubble."
The publisher is a respected name, St. Martin's Press. Copyright 2006.
So I bought it. And read it.
A strange book.
...
The author predicts that house prices will fall off the table, returning to their 1997 levels. All over the developed world.
Houses in New York and northern New Jersey will lose 44.6 percent of their value, falling from an average of $454,522 (in 2005) to $252,028 during the next five to seven years.
...
Anyway, my response is that people pay a lot of money for houses because houses are nice. You become the king of your castle; by paying down your mortgage, you own more and more of that castle -- instead of making your landlord richer.
Yes, it's clear that house prices in some areas are softening now. And maybe some people would be better off selling. But what a hassle!
...
And he may turn out to be totally correct, although I doubt it.
But if he's right, he will have made a self-fulfilling prophecy. If everyone who reads his book does what he advocates, the real-estate market will indeed be in serious trouble.
--------------
Now, after you've read the article (or the highlights I've posted here). Take a look at this piece:
Is it time to cash in on your home?
Who else might want to seize the opportunity to take profits? Anyone with more house than they really need. Warren and Rebecca Boroson bought their Glen Rock, N.J., home 29 years ago for $69,900 and raised their two sons there. But now, says Warren, "our children are grown and out of the house. We had four bedrooms, which is three more to mess up than we needed." Last year the Borosons sold for $579,000 and moved to a high-rise apartment in Hackensack, N.J., with a doorman and a swimming pool. [a rental]
"We sold mainly to lock in the profit," Warren says. "It was a little faster than we’d planned. But if you’re planning to sell in a few years, you might as well do it now while you’re sure the market is still good."
Warren writes a financial column for the Morris County, N.J., Daily Record that is syndicated nationwide. With an eye on retirement (he’s 69), he invested his cashed-out home equity in a laddered portfolio of bonds.
-----
I have a bit of concern with one small piece of the article, I'm not sure if it's just the way I'm reading it, but it comes off as a slam against the book's author, John Talbot.
By the way, the author is someone named John R. Talbott. He is identified on the book's back cover as a best-selling author (he wrote another book, called "The Coming Crash in the Housing Market"), was a visiting scholar at UCLA's School of Management and was an investment banker at Goldman Sachs.
Whether he has any real-estate experience, whether he graduated from college and whether he has any advanced degrees is not disclosed.
This really seems like a below-the-belt slam against Mr. Talbot. A quick search on the web finds the following bios:
John R. Talbott is an economic consultant who has authored academic papers on economic growth and development and made presentations on the subject to the governments of Russia, Jordan, and Qatar. A visiting scholar at the Anderson School at UCLA, Talbott is also a former vice president in the investment banking division of Goldman, Sachs, and Company.
Here are two of John Talbot's academic papers:
The End of Class Warfare: An Examiniation of Income Disparity
Political and Economic Freedoms and Prosperity
Not sure why a journalist would make such a rash assumption about someone's education and background and not just do a little leg work to find the real facts. I suppose that if you can't argue the facts, resorting to insult is the next best thing...
Caveat Emptor!
Grim
19 Comments:
Consumer Prices in U.S. Increased 0.7% Last Month
Prices paid by U.S. consumers rose in January by the most in four months, a sign companies are having more success passing along rising costs to their customers.
...
Economists expected a 0.5 percent increase in the consumer price index, based on the median of 68 forecasts in a Bloomberg News survey. Forecasts ranged from increases of 0.2 percent to 0.6 percent. Core prices were forecast to rise 0.2 percent.
grim
gg,
Agree 100%.
grim
This comment has been removed by a blog administrator.
"By the way, the author is someone named John R. Talbott. He is identified on the book's back cover as a best-selling author (he wrote another book, called "The Coming Crash in the Housing Market"), was a visiting scholar at UCLA's School of Management and was an investment banker at Goldman Sachs."
Is that the famous Anderson School that has nailed the bubble in tech stocks in 1999 and more recently the housing bubble in 2005? I think the author has way more street-cred than Warren Bozo-son
Unrelated, but can you sue a realtor for misrepresentation?
On the coldwellbanker website the same house is listed 3 different times (zip code 07401). Twice for $769 and once for $549. The feature photo on each listing is the same, showing the front of the house. The interior photos on the $549 listing are different. I would love to walk into the office and put a bid on the house for $549 and when they tell me its not available tell them they're going to be sued for false advertising.
Any suggestions?
Anon wrote:
"On the coldwellbanker website the same house is listed 3 different times (zip code 07401)."
Do you have the 3 links?
Could be a glitch, and I believe every listing from every realtor says the following: "information deemed accurate but not guaranteed."
Here;s the one for $549
http://www.coldwellbanker.com/servlet/PropertyListing?action=detail&ComColdwellbankerDataProperty_id=9049198&page=property
Hanlon's Razor..
Never attribute to malice that which can be adequately explained by error.
http://www.coldwellbanker.com/servlet/
PropertyListing?action=detail&Com
ColdwellbankerData
Property_id=9049198
&page=property
Its also listed on the GSMLS for $549
http://publicstage.gsmls.
marketlinx.com/templates/
media.asp?Uid=3211205&MlsNum=2107415
But I don't think it was just an error... I think it was intentionally done to pull more potential customers in.
Anon wrote:
"But I don't think it was just an error... I think it was intentionally done to pull more potential customers in."
Could be, I've recently seen Burgdorff change the zip code (MLS 2244112) after a crappy house sat without selling in the 'expensive' zip code where the house actually exists.
Those listings are both on the same street but have different house numbers. Seems like a mixup with the pictures.
grim
I continue to pictures of my living room from the house I sold last summer on the Coldwell Banker website. It was a great Living Room!
Is it just me or does it seem like there is a war of words going on now. This book. Lereah's new book (or old book with a new title, I dunno, I'm not spending money on it), mainstream media articles. This market is hanging in the balance and the balance depends on public perception.
Marinite
Marin Real Estate Bubble
It would be great if some of you eloquent and educated types would write some letters to the editor about this buffoon.
The Talbot book is interesting. I dug deeper on the book itself and Talbot does admit that he's let his anger influence the writing. I got this off of Amazon's summary of the book:
"As a guide for the average homeowner, this book is a convincing argument broken down into laymen's terms, albeit one fueled by bias: Talbott admits he, "allowed his anger and bitterness," to influence his writing, making it less a studied survey than a "creative analysis," as Talbott terms it"
I guess you can't fault him, many of us have the same anger or frustration. I would prefer the more studied approach though.
does anyone listen to this guy?
NOT!!
What a joke. Boroson flatly denies a bubble, yet pukes his own house. I love it! What a complete and total joker.
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