I wanted to thank a couple of really gentlemanly sorts of people I met lately, both of whom have good skills I wish I had more of. The first was a fellow I take to be the sort of king of the friendly soft sell, a real gentleman. His name is Mike Mehan, and he’s the founder of RealtyStar, a reseller for AgentOffice and some other software products. I spoke to Mike the other day and he knew within few minutes that I was outside his service area, yet he spent about twenty minutes with me on the phone anyway, having a great discussion not only about his software, but about business ethics, etc. He mentioned that when he started his company one of his first office policies was “We’ll never lie to a customer”.

I told him about my own motto, “Honesty isn’t the best policy. Honesty is the ONLY policy.” I thought it was a paraphrase of Nute Rockne. Turns out it was Vince Lombardi.

Imagine my surprise.

Anyway, really nice guy number two that I met recently was Jeff Brown, author of Bawld Guy Talking, a new blog about real estate investing. Jeff was nice enough to blogroll me recently, and then he told me this: “Your content is always worth the visit. I’d call this blog Web 2.1 because it sure doesn’t fit with the rest of us – it’s too good.” What a friendly compliment. Then over on his site, check out the title he put in the link back to my site. Now that was really thoughtful as heck.

The other neat thing about Jeff is that he knows lots of stuff that I don’t about crunching investment numbers. I hope he uses his powers for good, because if he doesn’t, I wouldn’t be able to catch him! That’s unfortunate, really, since obviously that means there’s a fairly substantial potential client base I might be overlooking. Moreover I suspect ramping up wouldn’t be rocket science (with no offense to Jeff), just something one needs to spend time on.

Anyway, I know this posts about some really nice guys comes right after promising to be on topic about real estate, and some of you are probably thinking, “What do nice guys have to do with real estate?” But there are some really great folks in this business, and I think it’s always appropriate, if not strictly topical, to encourage that.

I missed the spate of blog entries about New Years’ Resolutions, but I do have one or two, that are related perhaps.

• I want this blog to be more on topic, more of a consumer resource. I realize that means that I’ll get fewer comments, because so few of my readers are consumers, so far as I’ve been able to tell. I don’t care, really. Being more of a professional means being more on topic here. Period. Doing that in turn means reading my colleagues less, because that’s pretty much a distraction.
• If possible, I’d like to get more interaction going with readers about local real estate topics. But I won’t be holding my breath about that one, because, as I said, I think to the extent I’m on topic, my readership is likely to decline to me and the spiders.

At the same time, I have some ideas that might make some nice additional content that I haven’t coded yet. One of these would be a breakdown of Sacramento investment properties by Gross Rent Multiplier. (Yes, I know, Gross Rent Multiplier is a fairly dull-edged tool, but it’s a tool nevertheless, and it lends itself to the sort of automated reports I have in mind). The other possibility is an analysis of condo listings by total effective price (which I just made up). The idea is to compare the prices of condos from a monthly payment perspective, considering the impact of Home Owner Association dues so you can compare apples and oranges. That actually might make a neat calculator instead of a report, since of course it depends on what interest you can get.

Anyway we’ll see when I can get to that. Meantime I also have this really nice year in review post I’ve been promising, but I was too tired to be THAT on topic just yet.

Fans of neurolinquistic programming and other new age mind techniques will probably be encouraged by this tale. Yesterday I prepared myself by going out with a wonderful Lunch 1.0 with Mike and Julie. I then followed that up by wondering out loud about how to grow a successful web based real estate company. Sure enough, last night after about four hours sleep, I awoke with the Shared Website Agreement that I’ve been thinking about and unable to write just sort of sitting there in my head, waiting for me to pop it into Microsoft Word.

Getting over a month long case of writer’s block is as much a cleansing relief as any good sneeze.

Now to share it with a small circle of friends and further build on this (bwah ha ha!) empire.

Oh, sorry, did that come out megalomaniacal?

Mental note: pretend to be humble next time.

Now then, a real benefit for you as a reader would be if I applied myself similarly to getting my anti-web 2.0 megalomaniacal butt back on topic. So let me tell you about the next two articles, because then I’ll have to write them.

The next two articles will be about December’s real estate market in Sacramento, and an area-by-area breakdown of price changes over the course of 2006, another sort of “Year In Review” piece. Coming soon, and I apologize for the distractions.

Looking back on the 2006 Sacramento Real Estate market, the first thing I was curious about this year was whether my intuitive sense that the last part of the year was better than the first was correct or if this was just how my own business went. It turns out that I’m completely all wet on this one — the year pretty much followed the same seasonal pattern you would expect for any year, with the second quarter of the year being the busy season (the spring rush).

Here is how the unit volume breaks down by quarter, 2005-2006. (As always, our source is Metrolist MLS data, and all information is believed accurate but has not been verified).

So this chart does put the lie to one intuition of mine, that the second half of 2006 saw an upturn compared to the first half. At the same time, however, the numbers don’t seem to refute something else that I’ve been saying all along, that the turnaround point of the Sacramento residential real estate market occured sometime around August of 2005 (To be sure, this chart doesn’t prove it — but it doesn’t shed doubt on it, either, unless I’m missing something).

Let’s check out our average prices next, and see if that has anything to tell us.

Well, there you go, and as always, if you’re not careful, what it tells you is what you bring into it. Two sayings about statistical data are appropriate at this point:

• “There are lies, damned lies, and statistics.”
• “Figures don’t lie, but liars figure.”

An optimist with an overactive imagination could look at this and report, “Hey look, average home prices are rising, they went up 1.4% from 2005 to 2006!” I don’t think so, though it’s correct to say it. What I think the numbers show is that prices began falling in 2005 (duh), but that there continues to be significant seasonal variation in this buyers’ market, just as there was in the sellers’ market of two years ago.

Finally, without further ado, the median sale price numbers for the same period: