Goosing Housing From Mad Cows For 418 Episodes

February 28, 2023

But I digress…

Housing Notes Reaches Its 8th Year and 418th Edition!

I’m currently on vacation, so this is a limited but important (to me) edition of Housing Notes.

When I sat down to create Housing Notes and publish them in the first week of March, circa 2015, I wasn’t sure if I could sustain the weekly effort for a lengthy period of time. It’s gone through many iterations and added features until finally settling down to a stable format after the first year. As I’ve said many times, writing these on Friday mornings provides an outlet for all the ideas and info I’ve accumulated during the week. And then, the cycle starts again after I press “send.”

The housing world has changed a lot in these eight years, and I’ve enjoyed chronicling many of the changes, providing insights, charts, and dad jokes along the way. I’ve met many interesting people who read this effort and exposed me to terrific information resources and ideas.

Besides reaching the eighth-anniversary milestone, this is the 418th edition of these Housing Notes, so it’s scary to think about how much time I’ve invested in this endeavor. But it’s super fun and makes me a better market expert. I’m very proud of the quality of our readers and the very high open rates.

The newsletter has helped expose a sham election process in a trade organization with the help of others, and helped force the last two CEOs to resign. Although my wife dubs me the “King of Free,” it has provided a tremendous amount of appraisal and consulting business for our appraisal firm, Miller Samuel, and a vehicle to share the results of our expanding series of U.S. market reports for Douglas Elliman.

What’s next? Keep reading to find out!

A Greater Than Seasonal Rise In New Signed Contracts Swept Our Four Regions

I’ve been the author of an expanding series of U.S. market reports since 1994 for Douglas Elliman. One of the most recent series began during the pandemic lockdown, the new signed contract report covering various markets in New York Metro, Florida, Colorado, and Southern California. Here are the four U.S. regions and a sample chart for a submarket within each region. For all the charts, go here millersamuel.com/charts

The trend for all the regions/submarkets has been a greater than a seasonal uptick in newly signed contracts in February. These reports chronicle the number of contracts and listings that entered the market during the month of February, not a cumulative total. So if a contract was signed in December but hasn’t closed, it was part of the December report but not included in the January and February reports.

______________________________________________________
New York New Signed Contracts Report

Elliman Report: February 2023 New York New Signed Contract Report

– The New York report attached covers Manhattan, Brooklyn, Long Island, Hamptons, North Fork, Westchester County, Fairfield County, and Greenwich, CT.

Manhattan
The number of newly signed contracts surged monthly as new listings expanded for the second month.

Brooklyn
The number of newly signed contracts surged monthly as new listings declined for the fourth time in five months.

Long Island (excluding H/NF)
The number of newly signed contracts surged monthly as new listings expanded for the second time.

Hamptons
The number of newly signed contracts surged monthly as new listings declined.

North Fork
The number of newly signed contracts surged monthly as new listings expanded for the second month.

Westchester
The number of newly signed contracts surged monthly as new listings expanded for the second month.

Fairfield
The number of newly signed contracts surged month over month for the second time as new listings expanded for the second month.

Greenwich
The number of newly signed contracts surged monthly as new listings declined.

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Florida New Signed Contracts Report
– The Florida report includes the counties of Duval (New), St. Johns (New), Miami-Dade, Broward, Palm Beach, Pinellas, Hillsborough, and Collier (New).

Elliman Report: February 2023 Florida New Signed Contract Report

Duval County
The number of newly signed contracts rose month over month for the third time as new listings expanded for the second time.

St. Johns County
The number of newly signed contracts rose month over month for the second time as new listings expanded for the third time.

Palm Beach County
The number of newly signed contracts rose month over month for the third time as new listings declined for the third time in four months.

Broward County
The number of newly signed contracts rose month over month for the second time as new listings declined for the seventh time in eight months.

Miami-Dade County
The number of newly signed contracts surged month over month by its highest amount in nearly three and a half years of tracking as new listings expanded for the first time in eight months.

Pinellas County
The number of newly signed contracts rose month over month for the second time as new listings expanded for the second time as well.

Hillsborough County
The number of newly signed contracts rose month over month for the second time as new listings expanded for the sixth time in seven months.

Collier County
The number of newly signed contracts rose month over month for the second time as new listings declined for the second time in three months.

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Colorado New Signed Contracts Report
– The Colorado report covers Aspen, Snowmass Village, Basalt, Carbondale, and Missouri Heights.

Elliman Report: February 2023 Colorado New Signed Contract Report

Aspen
The number of newly signed contracts jumped month over month for the third consecutive time as new listings rose for the first time in three months.

Snowmass Village
The number of newly signed contracts surged month over month by its highest amount in nearly three and a half years of tracking as new listings fell for the second time.

Basalt
The number of newly signed contracts hasn’t fallen monthly for four months as new listings fell for the first time in three months.

Carbondale
The number of newly signed contracts declined monthly following last month’s surge as new listings expanded for the second time in three months.

Missouri Heights
The number of newly signed contracts was unchanged as new listings expanded for the second time in three months.

______________________________________________________
California New Signed Contracts Report
– The California report contains the counties of Los Angeles, Orange, and San Diego.

Elliman Report: February 2023 California New Signed Contract Report

Los Angeles County
The number of newly signed contracts surged month over month by its highest amount in nearly three years as new listings fell for the seventh time in eight months.

Orange County
The number of newly signed contracts surged month over month by its highest amount in a year as new listings edged higher.

San Diego County
The number of newly signed contracts rose month over month for the second time as new listings fell for the seventh time in eight months.

Record Housing Permits in Connecticut

Getting Graphic

My favorite charts of the week of our own making

My favorite housing market/economic charts of the week made by others


[Source: USAFacts]

My favorite random charts of the week made by others

Appraiserville

With Volume Down, ALOFT Let Its Trainees Go

Earlier this month, I saw this bulletin board post, and an error caught my attention…because Aloft is not an AMC. It’s a national appraisal company. I had assumed the same thing last fall when I was critical of them in these Housing Notes, and I ended up removing the post and apologizing in the interest of full transparency. Hey, I’m human (I think).

I was curious about the comments on the bulletin board because it means a vehicle to get people into the profession was lost if true. Some might assume they are also in trouble, so I contacted the Aloft CEO, Travis Soukup, for answers and got an immediate response.

[bold my emphasis]

__________________________

Hi Jonathan,

Thanks for checking in here. Unfortunately, some of this is true:

We did let go of our trainees. We just can’t make the economics work to support them right now. We had been paying a relatively high wage for a trainee position which was averaging $50k base plus ~$15k in overtime, plus benefits, 401k, training costs, etc. It was important to us that if we were to employ trainees that it was a livable wage. We also wanted to make sure it was a compliant pay structure as I know of a lot of trainees who are employed in a non-compliant structure with either just a revenue share model or very very low salary with no overtime eligibility. Note: I really don’t love it that non-compliant employment and a non-livable income is one of the few ways for trainees to get experience.

Our program was working when things were busier, but the downturn has meant we’ve needed to prioritize getting orders/revenue to the remaining appraisers on our team. We’ll likely add trainees back to the team in the future but at a very conservative pace. Also, all trainees we let go received advanced notice, a severance, and their McKissock license to continue with their QE classwork after their time at Aloft. Even though we’ve had to pause our trainee program, I’m proud that we could give trainees employment for as long as we did and get many of them enough experience to get their certification or get very close.

Regarding Aloft being an AMC: Nope, we’re not an AMC and I don’t want to be one. We’re an appraisal firm. I find our work making the appraisal process as high quality and efficient as possible for our appraisers to be the best use of our time and our team’s expertise.

Regarding Aloft shutting down, that is not at all true. We’re still employing appraisers, back-office support, and a team of engineers who are building really great technology for our appraisers and this industry. Our vision here is one of empowerment for appraisers and building community even if we’ve had to focus on maintaining a smaller team during this downturn.

Thanks again for checking in and let me know if you have any other questions here. I hope all is well with you.

____________________________

And Travis asked their Chief Appraiser, Hansel Dobbs to reach out as well:

__________________________

Hi Jonathan,

I would like to emphasize that the decisions we recently made were quite challenging. As an appraiser myself, I had the pleasure of collaborating closely with many of our staff to develop a robust appraisal methodology, adjustment support system, and addendum structure that culminated in an exceptional and consistent appraisal product known as The Aloft Way. While we are presently continuing with our remaining staff, it is worth noting that those who have Aloft on their resume are undoubtedly exceptional appraisers. The quality of appraisers produced by Aloft is evidenced by their swift reemployment or successful establishment of their own practices.

Thank you!

__________________________

I’ll say this about Aloft: Getting straightforward, quick answers to questions is refreshing. Transparency is the name of the game in terms of building trust with appraisers.

Appraisal Institute: Interview of VA Chief Appraiser James Heaslet

AI’s president Craig Steinley continues to lead the organizaton towards greater relevance and transparancy with this panel.

One of my friends and RAC member Craig Gilbert, ASA, SRA, CRP was one of the panelists and does a good job explaining why the VA, under the leadership of James Heaslet, is the best in the business. I’ve had dinner with James and connected and he is one of the good guys in our profession.

IAC + TAFAC + CARE = FUBAR Listening Tour

The TAF Board of Trustee meeting was held this week and was available on Zoom. As a reminder, TAF is the organization that wrote the bat-shit crazy letter, the chickenshit letter and is the subject of an active investigation by HUD on whether USPAP promotes a lack of diversity in the appraisal profession (BLS: 97.7% of appraisers are white). I wonder if EY is aware that one of its partners is the current Chairman of TAF’s Board of Trustees?

We learned that TAF would go on a “listening tour” to learn about the industry’s biggest issues. I don’t know what they do all day if they can’t figure it out already. It’s another pitiful attempt to make TAF look like they’re doing something, so they don’t need to actually do something but travel and party.

It’s rather diabolical. They can show the world they are doing something by traveling the country, staying in excellent hotels, and dining on filet mignon and expensive wine, all to learn what is going on in the industry.

How embarrassing.

What are the IAC and TAFAC for if not to inform TAF about what’s going on in the outside world? What is CARE for if not to inform TAF about what’s going on in the outside world? Those councils can share what’s going on with the naive uninformed leadership of TAF to their own admission. TAF feels the need for a “listening tour,” presumably because they were gagged and blindfolded in a deep dark cave for several years so they have no clue about what’s happening.

Again, what are IAC, TAFAC, and CARE for? Nothing, like much of TAF’s bureaucracy. They only serve to generate income for dining sorties and to show some sort of activity to add to Dave’s list of accomplishments when he speaks. My goodness – the addressing the “barriers to entry” would be all-consuming if they actually planned on resolving the problem.

Amazing.

TAF Professes Transparency But Won’t Share BOT Meeting Binders

TAF claims to be doing these BOT board meetings for transparency, but when asked about sharing the binders during the event, they said they’d consider sharing “abbreviated” versions. If this is actually happened, what’s the over/under on 2024? This organization is the opposite of transparent.

TAF Could Use Their ±$12 Million Slush Fund To Jump Start PAREA

I keep hearing the $10K PAREA cost per module bandied about. The idea is to provide an alternative to mentorship using a college-level software approach. This is not the sole solution to the barrier to entry, but it is one of presumably several more. It’s fascinating to think back over the years about how TAF stalled progress on PAREA, but now it’s in a hurry (on paper), not by action.

TAF needs PAREA to scale quickly to invest the payoff for developers and reduce the cost to appraiser trainees in the field. Dave has said the interest in signing up for PAREA is off the charts. So let’s call his bluff and scale it now!

I have heard that the software cost runs just under $1 million, so here is what I suggest:

Dave can dip into the $12 million reserve (that no one knows what it’s for, and no one understands why a not-for-profit has so much in reserve) and give four software companies $1 million each to develop. That would still leave a whopping $8 million in TAF’s slush fund (that no one knows what it’s for, and no one understands why a not-for-profit has so much in reserve).

With development costs eliminated, the course cost would collapse and become affordable, and TAF would resolve a serious problem regarding the “barrier to entry” to the industry. But this is probably an unreasonable expectation since TAF immediately removed the former ASB Chair from his position for wanting to discuss “barriers to entry” on the formal agenda. The Bunton monarchy doesn’t want to do that because they’d rather travel the nation to “listen” while dining on caviar, drinking champagne, and eating goose liver paté.

I can only assume that PAREA software products are in development, so I’m not sure how that would be squared with my above idea – I’m just trying to start the conversation to escape the current bureaucratic morass. Honestly, I’d probably be able to come up with a better solution if I could travel around the country for free, dining on caviar, drinking champagne, and eating liver paté. Sigh.

OFT (One Final Thought)

I’ve always found the Batman movies tough to watch – so gloomy and dark – after I was raised on this “quality” 1960s television series long since etched into my brain.

Brilliant Idea #1

If you need something rock solid in your life (particularly on Friday afternoons) and someone forwarded this to you, or you think you already subscribed, sign up here for these weekly Housing Notes. And be sure to share with a friend or colleague if you enjoy them because:

– They’ll be flocking to housing;
– You’ll stand up to mad cows;
– And I’ll look terrible in a Batman cape.

Brilliant Idea #2

You’re full of insights and ideas as a reader of Housing Notes. I appreciate every email I receive, and it helps me craft the following week’s Housing Note.

See you next week.

Jonathan J. Miller, CRE, Member of RAC
President/CEO
Miller Samuel Inc.
Real Estate Appraisers & Consultants
Matrix Blog
@jonathanmiller

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