Comments on: NAR wins battle against “Declining Markets”

By: Eric Blackwell

Eric Blackwell — Sun, 18 May 2008 13:20:18 +0000

I think I am in with ken on this as well… I do think that some of the changes became a self fulfilling prophecy in some areas. I think that some support in this case could have the opposite effect. Right now, I think a shortening of the recovery time is needed.

Interesting discussion, though.

By: John Sabia

John Sabia — Sun, 18 May 2008 04:21:25 +0000

“This change has the potential to cause a shift in buying patterns in many markets and help speed the recovery” – by Ken Smith

I Agree.

By: Tom Vanderwell

Tom Vanderwell — Sun, 18 May 2008 02:34:17 +0000

Matthew,

In regards to comment #17, I’m glad to hear that you aren’t opposed to the elimination of 100% LTV loans. The thing that puzzles me is how a good loan officer can have, in today’s market, a deal get surprised by the declining market issue several weeks into the deal? I’ve had a LOT of them, but I’ve done my homework up front, educated customers AT application, and haven’t had any that have blown up because of it.

It’s a matter of understanding the rules and doing the extra homework that it takes to clarify things in advance.

Tom

P.S. Has anyone asked the question – is it really better for consumers to be buying houses with no money down in today’s market?

By: Dan Sullivan

Dan Sullivan — Sat, 17 May 2008 23:07:08 +0000

The problem in my area (Denver), is that the entire metro area has been classified as a “declining market” – every single zip code, despite the fact that a good amount of our neighborhoods are experiencing a steady rate of appreciation.

I have a listing in a zip code that appreciated over 18% from January 2006 – January 2007. FNMA has declared it a “Declining Market”.

Whoever said “kneejerk over-reaction” hit it right on the head.

By: Shailesh Ghimire

Shailesh Ghimire — Sat, 17 May 2008 22:27:11 +0000

I’m in one of those declining markets situations and I’ve been ambivalent about the whole thing. I can understand Fannie wanting to ask people to put more money down when the trend has been downwards the past 12 months. However, my main point against it is the foreclosure’s we’re seeing isn’t a all attributed to high LTV borrowing. It’s more due to the lack of income verification. In hindsight the declining markets rule appears to be more of a knee jerk reaction and not very helpful. A better approach is to in fact ask for better income verification, and demand a higher credit score for greater LTV. Which they are starting to do.

Now do I think NAR has the right intentions in this issue? I don’t necessarily think so – considering their main objective is to serve its members. But they are correct in pointing out that Fannie wasn’t thinking right when they made the rules changes for declining markets.

Again an issue where we don’t have enough facts to say for sure what the right path should have been. I’ve always been of the opinion that most of the policy makers in Washington these days are flying blind.

By: Ken Smith

Ken Smith — Sat, 17 May 2008 20:30:22 +0000

The declining market policy was a self full filing prophecy in many markets. A market got labeled as declining and naturally there where less buyers able to purchase homes. Demand decreased overnight and without an equal decrease in supply prices had to decline.

This change has the potential to cause a shift in buying patterns in many markets and help speed the recovery.

BTW, any agent that hasn’t seen the direct impact of a city being labeled a declining market and needing an extra 5% down payment it would be impossible for you to understand. This truly is one of those times that you just have to experience it to understand.

By: Genuine Chris Johnson

Genuine Chris Johnson — Sat, 17 May 2008 15:06:26 +0000

You didn’t offend me; that would indicate that I either was surprised or cared. Do not ascribe anything to me or others in the future–i say this for clarity…you did attack me, however crude, disingenuous and ineffective it was.

By: Matthew Rathbun

Matthew Rathbun — Sat, 17 May 2008 14:57:26 +0000

Scott, I don’t mind debates, it’s the on going “how should you deliver your content” and “we offended each other” that I think should be one on one. Chris and I offended each other and I think that that issue has nothing to do with the post, per se. Since RE.net is so small, it’s important for these issues to be resolved, but to do so in the venue of “comments” hasn’t personally gotten me where I want to be. I’ve found many people are more apt to work these types of issues out one on one and not with a crowd.

Thanks for the opportunity to clear that up. I know that I am more apt to be offended when being called out in a group, than to feel it’s constructive when done one on one.

By: A few days in DC

A few days in DC — Sat, 17 May 2008 14:47:18 +0000

[...] met in person we all felt like we knew each other. We enjoyed a great dinner that was organized by Matt Rathbun with the RE.net/ Twitter gang and on Thursday enjoyed a presentation by fellow Bloggers Chris [...]

By: Scott P. Rogers

Scott P. Rogers — Sat, 17 May 2008 14:47:04 +0000

>> I’ve made it a personal policy to not carry on extensive debates by comments any longer, because after awhile it becomes argumentum ad hominem.

Matthew — in my opinion, the comments can sometimes draw out just as many good insights and perspectives as the post itself. While it can sometimes become a bit argumentative, the amount of dialogue that follows posts on Agent Genius is one of the reasons it is such an extremely valuable blog/resource/community. So — do what you need to do, but I think engaging in “debates” via the comments adds value!