Another Lazy Sunday
(c) View from Silicon Valley,
2007. All rights reserved.
After a several-month hiatus, my daughter and I finally took another
Sunday bike ride around the neighborhood. Like trying to start up a car after it was neglected too long in
the garage, getting this bike trip started was not without obstacles. We had to pump up the tires on both
bikes. My daughter's three-year-old bike helmet had somehow "shrunk" since our last trip. We had to loosen the
straps and live with the tight fit. Can you imagine the horrro? (Or the inconvenience?)
At the far end of the general area we criss-corss is
what passes for a hill in our neighborhood. On our first visit, after touring the split level house for sale on that
same corner, it was, "No way!" My daughter would hardly even look down the hill. Seeing daddy ride
down and back up on his bike has no influence on her decision. OK, no problem.
A week or two later the house was still for sale and she said
she wanted to try going for it. As we started working out the logistics of who would be where while she tried, she changed
her mind. No big deal, the trip was still a fine adventure too.
By now, of course, the $1.4M house with "a lot of potential" for
sale on that corner sold weeks, even months, ago. ("A lot of potential" was apparently the most positive thisng the
real esate agent could say about this house. Why people think it's a good idea to rush and pay $1.4M+ just for "potential"
is a missive for another day.)
The point is, this time out, my daughter announced she
was really ready to go down the hill. I stood nervously down at the bottom of the hill as she got ready. She started
out a little unsteady as her bike began to roll. As she gained speed, you could see the handlebars start to
wiggle back-and-forth. I had a momentary burst of panic but, fortunately, she straightened everything out and safely
rolled the remaining 50 yards or so down to the bottom. (It's a good thing. He mother would have killed me. ;=)
I was very proud of her. Even more so when she then realized
we then had to get back up that hill and there was no complaining.
There is a reason for risking your boredom with the proud
papa story. We think the elements of this story, however mundane, are in evidence in what we saw in the housing
market that afternoon.
In the months since our last roie, very little around the
neighborhood changed --at least at first glance. A quick count of the flipper projects finds a fairly-consistent count
of 10 projects in some stage of re-build /re-landscape /re-finish. No big news, until you look a little deeper.
For example, a house we saw on Easter Sunday was ~1,500 square
feet and "price reduced" to $1.257M. The seller didn't bother to paint it or even really clean it. They
even left an old window air conditioner lying on the floor. It sold within a few days of the price reduction.
So far, you may remember this information. However,
today's "news" is this house still sits empty four months later. Perhaps they're having a hard time getting
started?
At some point, people will look down that hill of expenses and
financial leverage and wonder if they can get back up to the top. It's too early to pronounce a change in trend but...
There is another flipper project next door to this empty
house and another three or four doors around the corner. On the corner opposite these flippers spending
literally millions of dollars is a home with tar paper tacked over the shingles. Maybe the folks who own this house
are wondering if their house shrunk?
In general, several of the flipper projects seemed unchanged
since we saw last checked them out a few months ago. Did they start down the road of becoming multi-millionaires but
run out of gas? (Change the last word to "money" or "courage" at your leisure.) Are their handlebars starting
to vibrate? Can they straighten them out?
OK, enough with the tortured analogies. Let's go back to
making a few observations.
There was one "project" where two guys were working in the yard.
Otherwise, there was zero activity anywhere. This is a departure from past Sundays where generally a third of the projects
have at least somebody nosing around trying to do something.
However, we made one particularly shocking discovery.
It's the first time we have observed this condition since we started
taking bike rides.
In four or five Sundays around the neighborhood, we've never seen
this happen.
The revelation here, the punch line, if you will, is there were
NO houses actually for sale! None. Zip. Nada.
What does this mean? Is it vacation season for EVERYbody?
NObody has a house they want to move?
Hmmm...
