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Sunday, April 08, 2007

Aubrey Cohen: Real Estate Cheerleader, Renter

I'll be posting the March reporting roundup either later today or tomorrow, but I caught this story in my inbox and I couldn't resist mentioning it. Although the subject is "Journalists gamble on job security at the P-I," the article contains some interesting information about one of our favorite local real estate reporters... (emphasis mine)

When Aubrey Cohen received an offer to become the real estate reporter for the Seattle Post-Intelligencer last August, he jumped at the chance. He'd already covered urban growth in Bellingham, didn't want to leave Western Washington, and was willing to gamble that the P-I would survive its current legal battle.

"I decided that at the very worst, I'd have a job for a year, and it was a good job," Cohen said.

Despite the P-I's uncertain future, Cohen is among several reporters who joined the daily in the last year because they believe the career benefits outweigh the risks.
...
Eventually, though, he couldn't pass up the opportunity to advance his career while remaining in the Northwest. Cohen and his wife sold their home in Bellingham and now rent in Seattle while they wait for the JOA ruling. If the P-I goes under and he can't find a job right away, Cohen reasons, the family can live off the money they made selling their Bellingham home.
Now why would Mr. Cohen be renting? For someone whose reporting seems to indicate a strong belief in continued double-digit appreciation for Seattle, the choice to rent seems... odd.

I mean come on man, you're missing out on our area's "extremely strong market fundamentals." Don't you know that "quite frankly, it's time to buy"?

(Heidi Dietrich, Puget Sound Business Journal, 04.06.2007)

18 comments:

meshugy said...

Now why would Mr. Cohen be renting? For someone whose reporting seems to indicate a strong belief in continued double-digit appreciation for Seattle, the choice to rent seems... odd.

I mean come on man, you're missing out on our area's "extremely strong market fundamentals." Don't you know that "quite frankly, it's time to buy"?


Wow Tim...you're really digging at the bottom of the barrel here. You should have also emphasized while they wait for the JOA ruling.. I think anyone in an uncertain job situation would rather rent for a while until they know they're definitely going to be somewhere longterm. His choice clearly has nothing to do with his feelings about the housing market. The guy could be out of a job and looking for work in another region at anytime.

If you're looking for hypocritical behavior among the media, you're going to have to do better then this.

google said...

But, if he lost his job wouldn't he just be able to flip his house for a $100K more than he paid a year ago, just like you "shuggie"? Seems to me his just loosing money as a filthy renter.

Lake Hills Renter said...

I understand renting if you're employment is unsure. That's the smart thing to do. But it does seem odd for someone to be eternally hyping the real estate market while renting. As google said, if he really believed the market was so hot, why not just buy now and sell if the job goes away? Seems like an easy way to make a nice sum of cash by appreciation. Stting on the sidelines and writing about it being white hot is like a stock broker predicting a 30,000 DJIA but not being in the market.

T,V & Mr.B said...

Keep in mind everybody, that Aubrey writes the articles, and not the Bogusly optomistic headlines, which is what gets us all in an uproar. Aubrey does report some of the bad things, though he may tilt a little to the influence of the advertisers, but he has mentioned that he has been suprised by some of the headlines that accompany his articles.

Jason said...

Tu quoque (Latin for "You, too" or "You, also") is an argument that asserts or implies that a certain position is false and/or should be disregarded because its proponent fails to consistently act in accordance with that position; it attempts to show that a criticism or objection applies equally to the person making it. It can be considered an ad hominem argument, since it focuses on the opposite party itself, rather than its positions.

Read any financial news site. Notice how many analysts recommend buying various stocks and then claim not to own any of them? Same thing to me.

betamax said...

Notice how many analysts recommend buying various stocks and then claim not to own any of them? Same thing to me.

Not the same thing at all. Analysts are affirming their objectivity regarding the results of their analysis. The RE equivalent is an appraiser not appraising his own house.

A market pumper who chooses to not invest in that market at all is quite a different matter.

Ouch! said...

Perhaps Aubrey could write an article about how much more affordable it is now to rent, compared to buy? How many "investors" have a cash-flow shortfall instead of a windfall?

BTW, almost fainted when I read Mark Trahant's column in today's paper. A local newspaper editor 1)Admitting that there's a housing affordability problem - bubble - in Seattle 2)Believing a pricing correction is possible & 3)Concerned that the downside may be excessive. Hmmm...
http://seattlepi.nwsource.com/opinion/310636_trahant08.html

Ouch! said...

Here's the shorter link to Trahant's column:
http://tinyurl.com/2w6wzq

EconE said...

Why should Tim have emphasized the JOA ruling Shug?

You make it sound like Mr. Cohen is the only one in Seattle that doesn't have Job Security.

I'm sure that there are many people that don't have job security and bought a house/condo...but following "shug" logic...they did the right thing by buying as there is now a stack of gold accumulating underneath their house.

Oh...wait...the price of gold has gone down before also.

The Tim said...

Jason,

Notice that I did not say "Mr. Cohen rents, therefore we can't believe anything he says about housing."

On the contrary, when I post about his real estate cheerleading articles, I take on the statements made in the article, not the person that wrote or compiled them.

All I'm saying here is that I personally found it interesting that Mr. Cohen's actions are incongruent with his writing. That has no bearing on the validity of his articles—they are mostly nonsense regardless of what Mr. Cohen's personal living arrangements may be.

FinanceGuru said...

You could make the arguement that since he is renting he has less bias to be as much a cheerleader than someone that owns, thus supporting most people's postion on this blog (on a subconsious level).

At least we know where he stands.

I read the paper this morning in the past two years real estate prices in Detroit have declined 5.8%...that number seems a little low with all the job losses and other issues going on in that region. What makes many here think Seattle prices will decline by 10, 20, or 30%...

For 2007 my prediction is +5% for Seattle, then nearly flat for the next several years (with the rate of inflation ~3%). If there is any decline it will most likely be modest, like the last time prices declined in the 1991 recession (only 6.22% decline at the lowest period, as shown in the Case-Shiller link posted two day ago by someone).

meshugy said...

All I'm saying here is that I personally found it interesting that Mr. Cohen's actions are incongruent with his writing.

Sort of like someone running a housing bubble blog that advises everyone to rent, yet has completely free housing himself and doesn't pay a cent.

meshugy said...

For 2007 my prediction is +5% for Seattle, then nearly flat for the next several years (with the rate of inflation ~3%).

I'd agree with that...I actually made the same prediction on this blog over a year ago. I assumed by this point we'd be back to single digit appreciation and may go flat at some point. But here we are, April 2007 and we're still seeing double digit gains.

MisterBubble said...

"I assumed by this point we'd be back to single digit appreciation and may go flat at some point. But here we are, April 2007 and we're still seeing double digit gains."

Or just as likely, slowing sales in the low-end market.

Eleua said...

'Shug said:

Sort of like someone running a housing bubble blog that advises everyone to rent, yet has completely free housing himself and doesn't pay a cent.

Yes Shug, you are correct. The Tim is a Class AAA hypocrite because he does not have a blog dedicated to living rent/mortgage free.

Everyone in Seattle should be living free-of-charge. Everyone should be a graduate of SPU. Everyone should be an EE. Everyone should be married. Everyone should be heterosexual. Everyone should have the name Tim.
Everyone should live in Kenmore.
Everyone should be a cutting edge blog master.
Everyone should tolerate your nonsense day-in and day-out over the objections of others on the forum.

I'm a Tim-bot. Are you?

Jazen said...

Here's the shorter link to Trahant's column:
http://tinyurl.com/2w6wzq

Great article, notice who they reference in the article? Bill Gross, probably THE most respected bond fund manager out there. I would not take his prediction lightly.

meshugy said...

Sometimes I wonder if even the predictions of the most skilled economists are a complete waste of time.

Take a look at this prediction for Seattle-Bellevue-Everett for 2006:

Hot home markets to cool down...how will your home fare?

They show 2005 appreciation at 16.3%

But predict a massive drop in 2006 to only 1.9%.

But look what happened...S&P/Case-Shiller just reported Seattle as having 11% appreciation in 2006.

And so far 2007 is also in the double digits.

Man, were they ever wrong.

meshugy said...

David Seiders,chief economist at the National Association of Home Builders, was calling for a slowdown all they way back in 97!

NAHB Economist Stands By Slowdown Prediction

In the spring of '97, Seiders warned that housing was likely to falter as the Federal Reserve Board began to tighten monetary policy. Then, in the fall, he fretted that the world economic crisis would bring the market to its knees. A year later, it was the Russian debt default that had the economist pulling out his hair. And last year, it was something else again.

Deja Vu?

But a funny thing happened on the way to the debacle. Growth in the housing sector didn't slow. It actually accelerated. An estimated 2 million units a year have been built since 1997, a level that by Seiders' own admission is well-above demographically-based estimates of sustainable growth.

And this was written in 2000! Some markets have appreciated 200% since that time....