Category Archives: Bergen County Stats

Bergen County: 3 Most Expensive Home Sales May 2013

In a tale of two economies (homes priced below $1.5 million, and above $1.5 million) the luxury market in Bergen County has taken a beating since the market crashed 5 years ago, and there’s still no signs of anything that remotely resembles a recovery.

Here are the  3 most expensive home sales in Bergen County for May 2013:

  • $3,000,000…Ridgewood…s sold at a 6% discount from the asking price
  • $3,300,000….Alpine…sold at a 21% discount
  • $3,300,000…Saddle River…sold at a 6% discount

Have to bitch about something here…
I hate the crappy photos that realtors use. If a picture is worth a thousand words, then it better be great photo or the thousand words will be less than positive.

Crappy photo decreases the value of a home:
Crappy meaning low resolution like you see on the njmls
Crappy like photos that aren’t staged or enhanced…and therefore make the room and home look crappy

Realtors need to stop being cheap.  If an agent doesn’t own a great camera, or pay to have professional photos staged and shot…THEN DON’T HIRE THAT PERSON!! The look and quality of your photos make all the difference.

Check out the photos on Corcoran.com

Now that the market has shown improvement, it’s time to raise your price and aim for your maximum value…and you can’t accomplish that if your home looks like crap online.

Getting your highest price is all about marketing.

Either have the quality of Neimans, or crap like Sears.

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Bergen County Home Sales Report 2013

The time has come for some home sellers to raise their prices.  And it’s time for others to lower theirs

I’ve been hearing a lot of chatter out there from realtors, proclaiming how great the market is in the luxury side, and I knew from my research that I wasn’t quite seeing that.  So I decided to check out the numbers once again to see what the real facts are.

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This is what I found for luxury sales:

  • Luxury home sales…$2 million +…is down 22% in 2013
  • It’s really yucky, in that only 14 homes have sold thus far in this price range.  18 homes sold in Bergen County for the same time period in 2012

A 22% sales decline on already anemic sales volume isn’t considered a great market.  In fact it borders on a market condition that sucks.

Here we are soooo close to the hyper active market in Manhattan and the borough’s, yet the Bergen County suburbs is on life support.  We’ll talk about why this is happening in future post, but for now let’s just say that it’s bothersome at best.

As for the market below $2 million…it’s a different world…night and day:

  • For overall homes priced up to $2 million the number of sales have increased by 14%.  That’s a huge number!
  • Homes priced to $499k…home sales increased 9%
  • Homes priced between $500k-$999k…sales increased by 26%
  • For homes priced $1.om-$1,999M…home sales increased by 31 %

Tell me that this isn’t great news!!!

So…if your home is for sale in this price …it’s time to raise your price!

Go for it!

For the first time in a long time, sales of homes priced from $500k-999k outsold homes priced below $500k.  But from what I can see, this is due to a lack of inventory of homes for sale below $500k…so people have to gravitate to higher priced homes if they want to live in Bergen County

It’s time for the realtors to see the light and start raising sales prices.

In the past they have used negative sales data as scare tactics to deflate prices, but now they have the ammunition to increase prices.

If raising prices creates less sales, then that’s fine, because higher prices leads to higher values, and higher appraisals….and given the complaint that appraisers are low with their value estimates, this will help to end that practice.

  • dramatic increases in sales volume means there’s more demand
  • more demand means more sales
  • more sales means…the market is improving and people are more confident to make a big purchase
  • Low inventory means more competition, and more competition brings higher price

And best of all…price increases creates confidence in the market.

If prices don’t start increasing then why would anyone want to risk their money with such an investment.  At that point you’d be better off putting tou money into the stock market.

Bergen County Home Sales: 2012

The home sales facts are in: Bergen County increased by 14% in 2012 (compared to 2011).

That’s great news…right?

Or is something hidden behind these lump sum numbers?

First…the real facts:

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The Good News:

  • Home sales: priced below $500,000 increased 14%
  • Home sales: priced $500k-999k increased 16%
  • Home sales: priced $1M-$1,499M increased 5%

Bergen County home sales increased 14% for homes under $1,499,000 (sold price…not the list price)

The Bad News:

  • The average sales price for homes in 2012, have decreased by 20%…from the peak in 2006
  • Home sales: priced $1,500-$2M were even
  • Home sales: priced $2M-$2.99M decreased 6%
  • Home sales: priced $3M-$3.99 decreased 12%
  • Home sales priced: $4M+ increased by 11%…but don’t get excited because the increase was just 1 home sale (9 home sales vs 10 home sales)

So, if it’s big news that the “whole” market is up 4-6% percent, then isn’t really big news when the luxury market is down by 8-10%?.  Isn’t this cause for a lot of concern?

Note:

  • Even with a 14% increase in home sales, sales are still down by an additional 31% from 2005 (the year before the Bergen County market crashed).
  •  Equally important is that the dollar volume for single family homes sold, decreased by 28%…however, theis doesn’t mean that sales prices are down.  It may just be that many more lower priced homes are being sold
  • Multi-family home sales have fared much worse…sales have declined by 51% since 2005. And the dollar volume decreased by 61% 

The fact is, Bergen County has a multitude of micro markets, that react differently to one another:

If someone combined all single family home sales in Bergen County into one group, then they would be misrepresenting a 15% sales increase for 2012.  Even though the entire market was up, if your $1.5M+ home was for sale,  your market actually declined 4% compared  to homes priced below $1,500K.  That’s a 19%  decrease swing from one price range to another

Raise your price?  You bet!

There’s some great news that everyone in our local real estate circle is ignoring: with such a high percentage of home sales in Bergen County being below $500k (even up to $1M), sellers in this price range should be raising their prices

Yes, raise your price!

When the demand is so high for homes in any price range, and the inventory of homes for sale is low, homes become more valuable. Avoid the agents push to lower your price.

Scarcity of homes for sale (or any other product for that matter), and high consumer demand is what every seller prays for.  When consumers can’t have something that they want, they’ll pay more to have it.  Including homes.

So it’s time to raise the price!

How long will it last

The time frame to raise your price in the New Jersey suburbs, is limited to the next 2 years.  In 2015 tens of thousands of rental units will be coming on the market, along the New Jersey waterfront (Jersey City, Hoboken, Edgewater, North Bergen) and elsewhere in the State. When that happens, the face of suburban real estate in our area will be altered for the next decade (a future post).

And lets not forget other important factors:

  • New Jersey taxes are insanely high, and will climb even higher…that hurts home sales
  • The New York City market is going gangbusters, and there’s better value in NYC, because prices are stable, and on the rise.  Right now NYC is a more guaranteed investment, especially for young people

Your time has finally arrived

Right now, it’s your time to take advantage of the opportunities to raise your price, and recoup some of the equity you lost in the past 5-7 years.

If my home was priced below $500k I’d raise the price between 10-20%…20% only for homes in great condition, where a buyer would have little to do in the way of renovations.  And a 10% increase is for a home in the worst condition…because the value of your home is in the price, and in the value of the land, that the home sits on.

Take it from a builder/real estate developer and numbers geek, who has lived through the best and worst markets: strike while the market is in your favor!  And run from anyone who tells you not to.

Let me know what you think

Will New York Billionaires Save The New Jersey Luxury Home Market

Location is everything when it comes to real estate.  And nothing shows this more than the article in this Sunday’s New York Times titled…Billionaires’ Club Is Set To Grow…The demand for high-end homes is also expected to rise.

 “The buying seems to draw traction from the fact that there will be so many more newly minted rich people hunting for properties. Over the next 10 years, some 95,000 more people around the world are expected to see their wealth grow to at least $30 million, according to a forecast by Knight Frank, a London-based real estate company, which puts the current number of such people at 189,835.”

The article ties in an expected worldwide explosion of billionaires, to an already exploding ultra-luxury residential market in  key cities, like New York City.

With what is happening in NYC and other major cities, translate into the same trend for the Bergen County, New Jersey market, which is (used to be) tightly intertwined with what goes on in New York City?  Do the mega home sales that we’ve all heard about happening in Manhattan spill over into our market, as it used to.  Or are these sales, and the overall strength of the NYC residential market taking away sales from the neighboring suburbs, and hindering our recovery.

Their assumptions may be true for specific locations like Manhattan…but it’s not the case in Bergen County, New Jersey, where the number of luxury home sales, are down 60% from the peak, and the dollar volume has seen a 67% hit.

The numbers show that luxury home sales and ultra-luxury home sales are being clobbered in Bergen County.  And I would be willing to bet that some of this is attributed to the boom that’s happening in the city on the other side of the Hudson.

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Some Facts:

There are 94 luxury homes for sale in Bergen County (priced above $3 million):

  • 21 luxury homes are for sale in in Alpine
  • 12 are in Cresskill
  • 8…Englewood
  • 9…Franklin Lakes
  • 22 are located in Saddle River
  • 7 in Tenafly
  • The remainder are scattered throughout other towns in Bergen County

The Scary Part:

  • 94 homes for sale priced above $3 million
  • In 2012 only 25 homes were sold in this price range
  • Sales in 2012 decreased by 23% from 2011
  • From the peak year of luxury home sales in 2006 compared to 2012, sales of luxury homes decreased by a whopping 60%
  • The dollar volume of sales at the peak compared to 2012 decreased by 67%

And there’s no end in sight to this downturn. The demographics are working against the high-end market, and high taxes. And the ego to purchase one of these suburban monsters isn’t there in the volume that’s needed to turn things around.

  • In 2012 the most expensive home sale in Bergen County was a $20 million home located in Alpine…a 40% discount from the asking price
  • The next most expensive home sale in Saddle Rive was $6,000,000.  This home was for sale since 2005 and was listed in 2010 at $9,250,000.  It finally sold at a 35% discount…and this was a fairly new home in an incredible subdivision.

The most interesting fact with luxury home sales in Bergen County is that out of the 25 homes that were sold above $3 million, only 1 home was sold to a foreign buyer outside of the United States, and only 5 homes were sold to people outside of New Jersey, and 4 of those were from New York. So much for all the talk about international buyers purchasing homes in our backyard.  Yes, real estate is local!

“In the end, the global luxury property market is functioning in its own universe, seemingly removed from general real estate trends. It “remains relatively impervious to these trends and more closely follows the luxury goods market,” Christie’s International Real Estate said in a study released this week.”

Christie’s International…you missed what’s really happening in northern New Jersey…but why let the facts get in the way of hyping the market.  And don’t think that what is happening in Alpine, New Jersey is irrelevant, because for the past bunch of years, Alpine has been one of the most expensive zip codes in the Country.

National stats and reports, have noting to do with what’s really happening right in your own back yard

Remember, real estate is local!

Bergen County home sales have increased every month in 2012

For those of you who like to understand what’s really going on with the housing market in Bergen County, here’s some data for you to sink your teeth into.

For the 6th straight month in 2012 single family home sales has increased.  Yes increased.

It’s time for every homeowner and seller to finally celebrate.  The housing market is on a roll in Bergen County.  Though the increase is not a all price points in every town the market has turned for the better.  No, we’re not going back to anywhere near the pace of the high flying days, or to those lofty prices…but the market has stabilized (which it has been for several years, if anyone cared to look at the data).

Wi8th the exception of January 2012 for multi-family home sales, every month in all categories has seen an increase in home sales.

Tell me that’s not great!

In fact, in 2012 we have not seen one month where home sales have decreased.

  • The number of home sales in 2012 has increased by 11% over the same time period in 2011
  • The dollar volume for home sales also increased by 7% over 2011
  • The average price for the homes sold decreased by 4%, but that was all due to sluggish sales at the luxury end of the market, where for some bizarre reason 2011 was an incredible year for the luxury market…but now it’s cooled

Though home sales are way below the volume set during the peak years of 2011-2005, Bergen County has experienced a steady market for sales…given this new economy.

The market for multi-family home sales is equally impressive for 2012:

  • The number of units sold increased 14%
  • And the sales volume increased by 7%
  • The average sales price fell by 6%. but is due to a lack of inventory at the upper sales range, and we had in the past.  Over time these units will invr5ease in vale because they’re newer and priced at a point that is more desirable to today’s buyers…either first time buyers or move down buyers

This is the new market. This is our new reality

No matter what happens, the number of home sales will not increase…even if Realtors continue to push sellers to cut their prices. More buyers are not coming into the market.  And with the rise of new multi family construction, the rental market will take a huge bite out of future home sales.

We have experienced 5 years of incredibly discounted prices, and historically low interest rates, and the data proves that lower prices have not increased the volume of home sales in Bergen County. And if you have been a reader of my blog, the data also points to the same facts for Tenafly, Cresskill, Closter or other towns.

Lower price do not create sales.

Check out my other posts to see what’s happening with home sales for Tenafly, Alpine, Cresskill and other towns.

Stay tuned…more to come.

Cedar Grove home hits the market at $17.9M

Northjersey.com reports that a $17.5 million home in Cedar Grove was recently listed (relisted) by Halstead Properties

Article…The other side of Cedar Grove: Home hits the market at $17.9M

Just you basic run of the mill 24,000sf mega ultra luxury home, in a town not noted for such grand structures

Don’t own one? No problem.

That is, if you can afford the $17.9 million asking price for Elita Kane’s chateau at 50 Laura Drive.

Northjersey.com takes a snide swipe at the asking price because the town assessed the value much lower than the asking price

According to the Cedar Grove Tax Assessor’s Office, the property is assessed at $2,778,700 – over $15 million less than Kane’s asking price. (The land is assessed at $462,900; the improvements, $2,315,800.) The annual property tax bill for 2011 was just over $54,000.

One has nothing to do with the other.  Just the mere fact that a 24,000sf home can’t possibly be replaced for this cost, should make you wonder why the town assessed it for such a low number.  But regardless, where can you find a home those size with property taxes at $54,000.  MAybe the tax assessor will have another look at this figure since northjersey.com pointed it out.

Wish there were more pictures to see, and why isn’t one of the pictures of the exterior?  Ahhhh, it’s because they want you to see more pictures on their facebook page, which makes you become a follower (a lead)…and they even have the nerve to put the pictures up for sale.  So how many photo T-shirts will they sell with a picture of this terrace on it.  My guess is zero.

Who would seek these homes in a town not known for such commodities?

“A high profile client,” Laurita answered, adding that the Laura Drive home could be on the market for up to a year. One famous actress-singer has shown interest in it, as have international investors from Beijing, Brazil and especially – California. Most of the interested clients are married couples sans children, he said. In order to make an appointment to see the chateau, one has to provide supporting documents of the requisite income.

The broker mentioned that it’s not unusual for a home in this price range to remain on the market for one year. Sorry, but 4+ years is more like it.

Many interested shoppers are also looking at properties in the affluent suburb of Alpine, Laurita said, noting that Kane’s asking price is ballpark to the prices of similar real estate in Alpine.

The commute to New York City is better from Cedar Grove than from Alpine, though, Kane’s nephew chimed in. He also noted that while Alpine homes boost mountain views, the Kane chateau offers views of both the mountains and city. He watches the famous Macy’s fireworks from the chateau terraces annually

Just a hint about the Alpine market, which has been on a respirator for the past 4 years.  If they want to compare this home to the homes for sale in Alpine, New Jersey, then they’ll need a large bottle of anti-depressants, because there’s nothing happening in Alpine.

And since when is it easier to get from Cedar Grove to Manhattan, than it is from Alpine to Manhattan?  Now they’re really dreaming

Let us know what you think

 

 

Are home sales more important to the economy, than dealing with underwater homes?

Some may consider me a pessimist, but I’m not.  I’m just a realist when it comes to analyzing the housing market

I was looking through some of my housing data just now, and something hit, that I really haven’t paid much attention to…the tremendous loss of real estate values (homes for this post) that we have all suffered ($6-$7 trillion), and what effect will this have on home sales and the economy going forward.

Everyone in the media and real estate brokerage is focusing on a new theme of affordability, yet there is very little being said that affordability isn’t anywhere close to being a solution to the market crisis that still looms over every one of us…not just sellers.

Almost everyone who has purchased a home since 2002 has lost money, and some have lost  And that holds true even for homes purchased today. 

Since 2001 almost 100,000 homes (single and multi-family) have been sold, and every one of those homes have lost value…and a major percentage of these homes are underwater.  And this is just for the homes sold.

This table not only represent Bergen County home sales, but more importantly it represents the number of people who have purchased homes since 2001, and who have lost money on the homes they purchased…and that’s almost every sale on this chart! And this chart is only for homes sold below $2 million.

The Wall Street Journal and a few other media outlets have started writing about this issue, because they’re starting to see the light.

This is a huge issue.  Underwater homes are the reason why the housing inventory is so low…homeowners simply can’t sell their homes for less than they’re worth, because they don’t have the money to make up the difference between the two amounts.

So it’s great news that prices are rising, and inventories are low, but this is only a temporary thing.  It won’t last.  There is a difference between the current low inventories of homes that are for sale…and for those homeowners who either want to sell their homes or have to, but can’t because their values are underwater.  And this inventory is the killer that’s lurking right in front of us, but is being ignored.

I love how the media has picked the side of the home buyer and affordability to write about, and miss a much larger problem that needs to be dealt with, before a recovery can take place…namely those who own homes and can’t sell them.  A recovery can’t happen until the underwater problem is resolved.  The problem won’t magically disappear.

What effects will this have for our local home markets in Tenafly, Alpine, Cress,kill and Haworth?  We’ll soon see.

Home sales in Bergen County are up 10%

It was another positive month for the Bergen County housing market

For the fifth straight month there was an increase in the number of home sales…

  • 2% increase for single family homes
  • and a 4% increase in multi-family home sales

For the year we averaged a 10% increase in sales for the entire county. That’s a combined increase of337 units!

The dollar volume for sales also increased by 4%.

The only item on the negative side was the average sales price, which declined by 4%

In a future post I’ll analyze the the numbers deeper so that we can all get a better feel for exactly what all of these numbers mean. So don’t jump to any conclusions just yet.

Some bad signs…the ultra luxury home market ($3+ million) in Bergen County is just outright horrible

Stay tuned for more

What’s really happening with home sales in Tenafly

2nd in a multi-part series on the State of the Bergen County housing market

Home prices coming down to earth in Bergen County, could signal a turnaround

As the article points out…

“If interest rates were any higher, there’s no way we would have been able to buy our house,” said Joshua Baris, a Coldwell Banker real-estate agent who bought a three-bedroom Dutch colonial in Tenafly last year. He and his wife, Hilary, locked in a rate just below 4 percent and a price — $660,000 — that was down dramatically from the earlier asking price above $800,000.

Contrary to what Realtors and the media believe, consumers have rejected the notion that low interest rates and decreased home prices, are what motivates them to purchase home.  The sales figures prove that point.

The reality is, if interest rates were higher, this buyer still could have bought a home…though probably a less expensive home.  But it wouldn’t have stopped them from buying a home…because their desire would have still been there to purchase. As we can see by the various charts in this series, we had a horrible market (or did it just return to normal) from 2006-200 (and some would consider that it’s lasted to the present)…yet thousands of homes and condos still sold in Bergen County.

There was a point a few years ago where you had to be pretty rich to afford a house in this area. Now, you don’t have to be so rich,” said David Blitzer, a housing economist at Standard & Poor’s.  

The door has always been open to middle class buyers…but now the door has closed quite a bit, because less of the middle class can meet the new lending criteria that is now in place…especially of you presently own a home, because chances are, their homes are worth considerably less than what they paid for it…or owe on the home.

The fact is, more homes sold when rates were considerably higher than they are today, and when prices were considerably higher as well.

Here’s some additional facts:
The following tables show (data from njmls) that year to date, Tenafly home sales are down by 9%…but that only equates to a 6 some decrease in overall sales…and that the average sales price is down by 3%.  In the article the reporter uses the median sales price as her control point.  But neither number by itself is an indication that prices are increasing or decreasing.

  • June sales were down 24% from June 2011…and that only equates to a decrease of 6 home sales
  • 50% of the first six months in 2012 showed a negative decrease in home sales in Tenafly. Only 2 months shined an increase in sales and one month was a break even

So what does this really mean?  Well it all depends what information you’re looking at.  Here’s an example:

This is where the data gets interesting…and where the  price decreases that are alluded to in the article become misleading: The following charts breakdown the various price points. And these breakdowns allow you to see exactly how each price point is performing in Tenafly, and how they pertain to one another, or work against each other when trying to ascertain what is really happening with home prices.

You’ll quickly notice that not every price point performs the same way. And that is why each price point has to be looked at by itself.

Every town is made of of numerous micro markets: some are doing incredibly well, while others are downright horrible…all in the same town at the same point in time. And not every town is performing to the same level (that discussion is for another post)

Table 2:

  • The top box in green shows the all sales for every price range combined in Tenafly
  • The next two boxes show the sales data broken down into 2 price points…below $1M and for more than $1M

Table 3:  shows  a further breakdown of the sales stats from chart 2

  • The table shows an increase in sales of 33% for homes priced under $500,000. Though it’s only a 4 home increase, it’s a still a 33% increase
  • the 2nd table shows an 11% decease of home sales from $500k-999k…but that’s still only a 4 home decrease in sales…but 31 homes have sold in this price range in 2012. That’s a big number!

Chart 4:

Where it starts getting funky for Tenafly is for sales priced above $1 million (the luxury home market)…where the percentages have “tanked” compared to 2011…which was not a surprise. 2011 was just a lucky year for this price range. And even though the differences are small in volume, it does show a down good trend.

The market gets a bit unsettling is for houses that are for sale priced above $2 million in Tenafly, because that’s where sales have been the weakest since this time in 2011.  And as you can see by the data, home sales sales from $1 million plus have decrease by roughly 40% in Tenafly.

Conclusions:

From the date provided in the northjersey.com article, no one can state for certain that house prices have decreased in Tenafly.  Nothing in the article was conclusive.  In fact…the numbers shown on my charts point almost to the opposite…that prices for homes priced below $1 million have remained the same, when you take out the loss of many sales at the upper price ranges.

You have to look at the individual sales to determine price increases or decreases. because the average and median price points are false indicators of value

And when you compare these numbers to sales in the towns surrounding Tenafly, it still shows that Tenafly is the hottest market in the region…by a wide margin…even though sales at various price points have decreased…as they have for all the other towns in the area.

I keep saying it…Tenafly is a sellers market no matter what price range…just follow my previous posts on Tenafly for the backup data.

From my POV (which differs from the local realtors) most homes that are for sale in Tenafly, priced below $1 million are under priced, and should be raised to compensate for this.

Raising prices accomplishes several things:

  • Creates stability
  • Increases the value of everyone’s homes
  • Forces realtors to push for higher prices
  • Growth attracts and entices buyers
  • Creates competition, and competition creates value

Tenafly has long bottomed out, and now is the time to climb our way out from the bottom.  The “price it right” sales mantra is irrelevant in a town where demand is higher than in other towns…there’s no need to push prices lower.

Know the real facts before you look to sell or buy a home.

Next…a detailed breakdown of home sales in Tenafly from 2001-2012

Did North Jersey home values really decrease?

A recent headline that appeared in northjersey.com  stated…NY metro area home prices continue to slide Something didn’t jive with the article compared to the research that I do on a continual basis.  So I started digging a little deeper.

It’s not so much that prices may have come down, but the research indicates that more people are purchasing lower priced homes than in the past…and this is what’s causing the casual eye to think that prices have dropped.

Purchasing lower priced homes has nothing to do with lower prices, as one would take from reading this article.

The median price which most reports use as the value of a home, is simply the middle price of all the homes that have sold in a particular time period.

It has nothing to do with an increase or decrease of pieces.

The fact is, the flight to lower priced homes in Bergen County , New Jersey, is something that has occurred since 2006.

People aren’t buying nearly as many higher priced homes in our area, as they used to.  And that’s going to be the way it is for a very long time…eventually homes in the higher price points will come down in value.  But until they do, all that we can say is that they are not selling.

We can’t specify for a fact , what these homes are now worth.

Furthermore,  to lump all housing types into one bundle and not break them down to indicate what they are also misinforms. Single family home sales:

  • This chart simply shows that more sold for under $1 million in 2012 than in 2011…a 207 home increase.
  • The remaining price ranges remained basically the same.

This simply skewed the median price downward…not the price of the homes Multi-family home sales:

  • The same thing has basically happened to the already anemic multi-family market…more people are purchasing lower priced units.

None of this is to say that prices haven’t dropped some, but the data being used doesn’t accurately portray the market.And again…to lump the region all together is inaccurate as well. Real estate is local, and within each town there are several micro markets that act differently from each other. I lay fault with all this market misinformation on the Realtors and their trade associations.

They have the informational…from homes for sale, sales prices, and a whole host of other facts and stats.  But they refuse to make it all available.  How can you trust someones information if they won’t make it transparent and verifiable?  You can’t.

This is my little attempt to make some sense out of something that’s made very confusing.

Let me know what you think.  And if you have some facts that will add to the story then please tell us.