Sometimes the truth hurts. Real estate salesman Jim Klinge doesn't care.
Cruising through the sunny hills of Carlsbad in a massive silver Mercedes-Benz, he looks like any other pitchman of the California dream.
But Klinge, 50, has become a notorious Internet chronicler of the real estate crash in north San Diego County, where he has lived and worked for decades.
Rather than downplay the greed and excess that caused the region's travails, he revels in exposing them.
He surveys the wreckage with a pocket video camera, shooting footage of vacant, once-pricey houses turned into eyesores, voiced over with his deadpan narration. Then he posts them on his website, at www.bubbleinfo.com.
They're shaky, noisy clips full of coarse images and language.
"Would you spend a million dollars for that house?" he says in one video, showing a two-story, boxy wreck with the rushing sound of a freeway in the background.
Why does he do it? To sell houses.
Klinge is a real estate broker, has been since 1984. He just doesn't act like one.
In the summer of 2005, Klinge says, he sensed the housing crash coming. He had been through the real estate downturn in the early 1990s and was wary that the red-hot market couldn't last.
But his real estate industry colleagues continued to declare that home values would keep soaring.
Most agreed with David Lereah, then the chief economist for the National Assn. of Realtors, who finessed the question of the market bubble this way: "I could think of froth as effervescence rather than some popping of bubbles," he told the San Francisco Chronicle in June 2005.
Klinge heard the same thing from fellow brokers in San Diego. He felt that such talk emboldened buyers to take on more debt than they could afford and prompted sellers to ask too much for their houses, which would cost them time and money as their homes went unsold. He started blogging, his first post questioning the 20% to 30% annual home price appreciation in some neighborhoods, and arguing that "sellers have gotten too optimistic and are pricing their houses WAY too high."
Nowadays, Klinge said, his blog gets about 2,000 unique visitors per day. About half his clients now come to him from the blog, Klinge said. He closed 43 house deals last year, he said, down from the 61 sales and purchases he brokered in his peak year of 2004, but enough to keep him in business when many agents have quit.
Lately, his videos have been picked up on Calculated Risk, an influential economics blog whose followers include Nobel laureate Paul Krugman. In one clip, the camera pans across the kitchen of a million-dollar fixer near Interstate 5. He pointedly notes the house's proximity to the freeway, which he calls the "De-troit river." There's mold under the sink and a foot-sized hole in the drywall just above the floor.
"December 2006 this house sold for a million dollars," he says. "Nineteen hundred square feet, built in '78, right across the freeway. One million."
On the off-chance the real estate agent who sold the place is watching, Klinge puts in a request: "I want you to put your mai tai down, go grab your shingle and send it in to the DRE [California Department of Real Estate] right now. You don't deserve a job," he says. "Everyone who was on that deal deserves to be fired, even the janitor at the escrow company. This is embarrassing, $1 million. Right now it's listed at $575,000 and that's probably optimistic."
Along with the house wreck videos, the site includes statistics on local home sales totals and price declines. Klinge has skewered brokers on the blog, calling them names like "clown" and "cherry-picking cheerleader" for not admitting that the housing market had tumbled. But he said no one had gotten upset enough to retaliate.
Klinge didn't start out as the Hunter S. Thompson of real estate. He used to believe. In 1987, just three years into his career, Klinge had set up his own office in La Jolla and was riding the rising real estate market. He was convinced home prices would keep soaring.
"Everybody wants to live in La Jolla," he said, repeating what he and everyone else were saying then.
Klinge learned the hard way that even chic beach communities go down when the housing market tanks. "By the end of 1990 I could not find a buyer. I had no idea what to do, I had no history or experience" with a down market, Klinge said, "like a lot of agents today."
He closed his office and became a mortgage broker. Arranging refinances got him through the 1990s real estate slump, and he returned to home-selling in 1995.
Klinge said the 1990 real estate downturn made him cautious as home prices skyrocketed in this decade. "I never got overly bubbleicious," he said. His blog's underlying theme, he said, has been "You can't forget this is a regular business cycle. There are ups and downs, and you've got to plan for that."