Last night, a group of 10 from my office made the trip down to Tempe’s historic Valley Art Theater - yes, historic has to be included in any mention of a theater that has stood for 67 years while all around has been converted into a driveable mall - to see “Closing Escrow” before its brief run ended at midnight.

The movie critic from The Arizona Republic said you’d need to have a thick skin if you were a real estate agent watching the film. For some that may be true. For us, we had more fun matching the film’s characters with agents we know in Mystery Science Theater 3000 style.

(Last night’s total crowd was 18 - a good night at the Valley Art not involving the Rocky Horror Picture Show - so we weren’t exactly disrupting things with our alcohol-fueled hysterical laughter.)

What was particularly interesting was the buzz indicated real estate agents were being mocked. And we were, no two ways about it. If Mr. Hide and Seek was the listing agent on a property I was showing, I’d likely punch him in the nose.

But the general public wasn’t spared either - not the buyers who often don’t know what they want in a home until they see a home that doesn’t have what they didn’t realize that they wanted, not the sellers who can’t deal with strangers touching their things. And certainly not the “this doesn’t look so hard … so I’ll just get my license” crowd.

Also interesting was attention to the smallest details which led me to believe there were either current or former real estate agents involved in the writing. (Like jimmying a lock with a credit card rather than using the lockbox before creating “forced depreciation.” All entrants on an electronic lockbox can be tracked.)

If/when Closing Escrow makes it to DVD, it’s worth the couple bucks to rent.

(picture courtesy of TempeBeach.com)

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Here are some of the highlights from President Bush’s press conference this morning outlining plans to provide relief to struggling homeowners.

Some of the usual blog geniuses already are screaming for the government to be overturned because of this “bailout” plan, as if Bush and Bernanke will be at the local Circle K handing out checks. I’m just not seeing it.

What I’m seeing is this quote:

“We’ve got a role, the government has got a role to play — but it is limited. A federal bailout of lenders would only encourage a recurrence of the problem. It’s not the government’s job to bail out speculators, or those who made the decision to buy a home they knew they could never afford.”

And what I’m seeing are these particulars …

• FHA will begin a new program called FHA-Secure which will allow homeowners with a good credit history but are unable to meet their current payments to refinance into an insured FHA loan. (If it truly was a bailout, would they really be moving from one mortgage to another?)
• Bush called on Congress to adjust the tax code, apparently to deal with short sales being taxable events. The speech keeps referring to tax implications on a refi but the scenario he lays out is a short sale. As it stands now, if a homeowner owes $300,000 but only can sell for $250,000 - the $50,000 would be taxable income.
• Bush discussed development of a new “foreclosure avoidance initiative” to help struggling homeowners find a way to refinance. (Again, if this were a bailout, I don’t think the owners still would have a mortgage at the end of the day.)
• He also outlined ways the government is looking to make the mortgage industry more “transparent” including novel concepts such as explaining to a borrower the details of their loan.

Moving toward FHA financing isn’t a bad thing. A lot of homeowners with these exotic loan products might have been able to get an FHA loan once upon a time, but a lot of lenders avoided the program because of the extra paperwork and hoops involved.

I’ve said it three times before and I’ll say it again. I’m not seeing a bailout. I’m not seeing where the rest of us are going to be spending our money to bail out those who can’t afford their current mortgage.

If I’m missing it, read the transcripts and tell me where.

UPDATE - ADDITIONAL COVERAGE

• FHA Secure: A Political Power Move Disguised as a Helping Hand to Those in Need
• Busy News Day: Bush & Bernanke Both Talking Housing
• Let the Lenders Eat Cake
• Bush’s Plan to Help Borrowers has Some Merit but Isn’t Enough to Matter
• Bush to Propose Bailout But Likely Won’t Call it a Bailout
• President Bush Announces Plan to Aid Homeowners in Trouble

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A couple of weeks ago, Mr. Kay started a daily Good Vibes post. All of us could use some good vibes from time to time. For me, I managed to find a few at an Omaha Hi-Lo Table last night at Casino Arizona.

We’ll skip past the part where I was one of three players at the nine-person table in the housing industry - two agents and a lender - and go right to the heart of the matter. If you’re looking for the real estate analogy contained within the post, scroll down to the words “Welcome Back” and we’ll see you there. For those who play the game, and I know some of you so, read on …

All I really wanted to do was go home. I was down around $50 or so at a $3-$6 table but had decided enough was enough. I even said out loud that all I wanted were some lousy cards so I could fold and leave. Instead, I received Q-Q-4-3 with two diamonds - one of them the queen.

It was a kill pot so I antied my $6. Then another $6 on a raise. And then there were two more raises. And soon I went from just wanting to leave to calling $24 before the flop with my two queens.

I felt much better when I flopped a third queen as well as the ace of diamonds. That ace and the flopped deuce also gave me a draw for the best low hand. Everyone checked around, which was fine.

Then came another diamond, the seven if memory serves. Now I had a four-card draw to a flush and the best possible low hand at 7-4-3-2-A. Needless to say, I wasn’t going to check through. I bet, three others called.

On the last card, my entire focus was on the board pairing so I could take the full house. I had forgotten about the flush completely. So I had to do a double-take on the river when another diamond fell. And I had to pinch myself when someone else bet $12. I raised, still picked up two callers and then listened to the murmuring as I turned over the cards: the nut low hand, a winning flush and a $260-plus pot.

Yeah, that wasn’t so bad.

(WELCOME BACK!)

When I sat down at the Omaha Hi-Lo table last night, I was supremely confident of my abilities and my chances for success. I’ve played online quite a bit and knew the game as well as anyone could.

Or so I thought. Looking from the outside, such as in an online game, is far different than being on the inside in the casino.

Real estate is much the same way. Realtor-haters will tell you how easy this job is, how there’s no special skill set required to market and sell a home or to assist a buyer through a transaction. Some continue to take pot shots from the outside. Others get their license and discover their ideas aren’t nearly as good as they thought.

A couple of months ago on Housing Doom, a soon-to-be-licensee was explaining that all of these inventory homes should be sold through an auction strategy. Create demand and the home will sell. Great theory - almost as good as my raising with the low hand on the second hand I played yesterday, in that maybe it’ll work but more times than not it’s a mistake destined to lose money.

Auctions don’t always work well. In fact, they’ve been far less useful in our current market than in the past. The bidding doesn’t rise high enough to satisfy the seller and both parties walk away. (Auctions aren’t binding. All the high bidder gains is the right to negotiate to buy the house.)

There’s a substantial difference between doing this for a living and watching from the sidelines. Sometimes you don’t see it until you take that step across. But it’s there.

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From Laurence Yun, the new Lereah:

 “Home sales probably would be rising in the absence of the mortgage liquidity issues of the past two month.”

And if all that inventory suddenly went away, that would help too. Oh, and if the builders would constrain building and stop murdering the resale market with their blue-light special incentives.

And if … and if … and if … and if … and if …

Tonight, a group of us from my office are going to go see “Closing Escrow” at the Harkins Centrepoint in Tempe (most likely with a stop at Gordon Biersch before we go.) Real estate agents make for easy marks. Thank goodness we have an organization like NAR to help defend the industry keep painting big red bullseyes on our back.

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If it’s August, it’s time for the Minnesota Association of Realtors to begin their annual bleating about the swollen Realtor ranks in its state. (Forgive the lack of property capitalization but I just don’t have the energy to worry about another silly NAR demand.)

Says Glenn Dorfmann, COO and chief lobbyist for MAR:

Brokers must reduce the number of “unproductive agents” (x transactions per year) in order to stop the dilution of productive, professional agent’s income. If this does not happen, REALTORS® should stop the blabber about “professionalism.” My definition of a “professional” in real estate is someone who counsels consumers in the buying and selling of real estate and does at least 10 transactions per year. [Real estate sales is an experiential based business: the more business one does over time the more proficient, competent one is–consumers/customers make this determination based upon the depth and breath of the services provided by the REALTOR® not based upon the symbolic REALTOR® “R.”]

First, Glenn, the word is “breadth” not breath. Not unless you’re selling Altoids.

Second, let the consumers at large determine the depth and breadth of experience that they require for their real estate transaction. If members of the public continue to opt for their cousin Jimmy because he’s family despite his track record of one transaction in two years, that was their choice. It likely was foolish, but it was their choice. Caveat emptor, my friend.

Third, you’re right, Glenn - almost. It’s not the Realtors who need to stop all the “blather about professionalism” but NAR and the local associations. If NAR and the state associations are committed to true professionalism among the Realtor ranks, stop declaring anyone who is able to write a check to be a Realtor.

This also would require many local boards to give up control of the local MLS to the brokers (which will not happen anytime soon) because you can’t require stringent standards of sales and then withhold the basic tools from this who will need them.

Fourth …

consumers/customers make this determination based upon the depth and breath of the services provided by the REALTOR® not based upon the symbolic REALTOR® “R.”

Um, have you heard the NAR commercials? The R’s all you need, baby!

(sigh)

Real estate is an open marketplace, despite what many believe. Pass a fairly easy state and national exam, pick a broker and start writing checks and you’re underway. Those with the skills to survive will. Those who don’t won’t.

Don’t call on brokers to make the changes in the industry, Glenn. Changes need to start at the top. Or even at your level for that matter. We can shout into the wind as much as we want down here on the front lines. Nothing changes.

And nothing will until you stop assigning blame on those trapped in the system rather than trying to fix the machine of which you’re a critical cog.

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