Buyers Are Looking For A Bargain
News reports from from Oklahoma. “There’s a cooling trend, but not a cold snap, in Oklahoma City home values, once hot but apparently never as overheated as in many big cities’ bubbly housing markets. Realtors said the excess of homes on the Oklahoma City-area market is causing it to take longer to sell houses. Home buyers are driving harder bargains, but most sellers aren’t overreacting by slashing their asking prices, Realtors said.”
“‘Buyers are looking for a bargain and they want to see everything out there. Used to, I could pull the top 10 houses, the top 10 neighborhoods. Now they want to see everything,’ said Karen Blevins, a Realtor in Oklahoma City and Edmond.”
“There’s more of everything to see. July ended with 9,328 houses for sale in the Oklahoma City area, a 5.6-month supply based on average monthly sales the past 12 months. That’s up from a 4.8-month supply at the end of 2006.”
“It’s a buyer’s market and buyers know it, said Linda Finch, a Realtor in northwest Oklahoma City. Sellers’ asking prices are starting points, but just starting points, for negotiations, as far as buyers are concerned, she said.”
“Blevins said buyers…expect to get something at the closing table: closing costs, which can be between $3,500 and $4,000 on a $150,000 home.”
“Sellers are bringing the cash, Blevins said, but ‘they’re being a little more patient than they used to be. They have to be more patient to get their price.’”
“Cross-town buyers are usually sellers, and ‘They want it both ways,’ she said, top dollar for the house they’re selling, the best price for the one they’re buying. They don’t usually win on both ends, though. It’s a buyer’s market, so they win on the buying end, she said.”
“Finch’s advice to sellers: Spend a little money to make improvements and add value to a home, as a cushion against buyers’ expectations of a price discount.”
The Star Telegram from Texas. “Foreclosures have been surging for five years in North Texas, and almost nobody cared. Now suddenly the problem is part of a global financial crisis.”
“It’s easy to blame California, Florida and Nevada, where the housing bubble is going pop. But this is a bill that we ran up, too, and it had to be paid sometime. ‘It’s going to be a cold winter,’ says John Baen, a real estate professor at the University of North Texas, who predicts tough times ahead for housing and the broader economy.”
“Foreclosures aren’t the cause of the trouble; they’re a symptom of scores of bad home loans and years of overbuilding. In this area, rising foreclosures were sending a signal to the market three or four years ago, but they were ignored, with few consequences. And that says a lot about how the housing market became so overheated.”
“In North Texas, foreclosure postings have tripled since 2001, according to George Roddy, of Foreclosure Listing Service. Yet the local economy has shrugged them off as a nonevent.”
“Until recently, the housing market was on a tear. When loans were easy and cheap, home builders kept adding volume in Texas, even as defaults climbed. The area lost 80,000 jobs in the 2002 recession, yet home starts continued to surge, notes Ted Wilson of a Dallas real estate research firm.”
“‘By 2003, we thought there’d be a decline in housing starts,’ Wilson says. ‘But builders said they could qualify anybody for a house, and they were making huge profits on the East and West Coasts. They wanted to use Texas to increase their unit counts.”
“That strategy is over. Home builders have suffered crippling losses, and many subprime lenders have gone under. In the Fort Worth area, residential building permits dropped 34 percent in June; on the Dallas side, building-permit activity is running at levels last seen 10 years ago.”
“Wilson says that many local builders have laid off workers, and mortgage companies presumably have cut back, too.”
“Through the first nine months of the year, foreclosure postings rose 12 percent for North Texas and rose 14 percent in Tarrant County. In the latest postings, the average loan originated in 2003, according to Roddy. And an even greater number of risky loans were made in ‘04, ‘05 and ‘06.”
“‘Do the math, and that means we have two to three more years of this left,’ Roddy says.”
“In North Texas, the largest concentration of foreclosures involve starter homes and subprime loans to people with poor credit. ‘We increased homeownership a whole bunch in the past five years,’ says Baen, the UNT professor, ‘but the great American dream became a nightmare for a lot of these people.’”
The American Statesman from Texas. “Plans for a $4 billion, 3,500-acre development in Leander that would have clustered homes with parks and commercial developments, as well as more than doubled the city’s population, have folded.”
“Florida-based Avalon Park Group Management Inc. terminated an agreement with the city and a local developer last week, citing a weak national homebuilding market.”
“‘It wasn’t the right time to go with a project of this magnitude considering the overall market,’ Beat Kahli, CEO of Avalon, said. Kahli said the project would have depended on national homebuilders, most of which are struggling because of the jittery market.”
“The development would have clustered more than 10,000 buildings with park and commercial developments between Crystal Falls Parkway and Lakeline Boulevard. It was similar to the city’s 2,300-acre residential and commercial development that centers around a rail line that will run from Austin to Leander.”
“The $4 billion project would have been a record for Leander. Avalon officials originally requested between $240 million to $300 million in incentives, but the city only offered $120 million, which would have been another record, Leander Mayor John Cowman said.”
“The collapsed deal is a blow to Leander, which could have gained an increased tax base from the development, but city leaders say other projects are in the pipeline. Bill Hinckley owns the 3,500 acres that would have been developed by Avalon.”
“Hinckley said three new communities are being planned on the 3,500 acres, and, with roads such as the 183-A tollway in place, the area is ripe for development.”
“Despite national home market problems, the Austin area is still a hot spot, said Mark Sprague, Austin partner of Residential Strategies Inc. Sprague said new jobs being created by high tech companies, such as Samsung, as well more people moving into the area, have cushioned it from feeling a major ripple from the national market.”
“‘We’re in a great bubble here in Austin,’ he said.”
‘In North Texas, foreclosure postings have tripled since 2001, according to George Roddy, of Foreclosure Listing Service. Yet the local economy has shrugged them off as a nonevent.’
As has the local media for the most part. North Texas has been near the default rate of the 80’s since spring 2005, yet the builders were going crazy with starts and loans.
‘Two weeks ago, an Avalanche-Journal analysis of the market found new single-family home permit activity had fallen by 20 percent. Now a new Lubbock Land Co. survey shows the market is starting to make a turn. At midyear 2006 there were 445 new homes either under construction or sitting idle in inventory.’
‘Worst off were new homes priced from $250,000 to $300,000, where there is now an 8.64 month supply up from 6.29.’
‘Foreclosures in VIctoria County for the first six months of 2007 have surpassed annual totals for previous years. The county’s seen 372 notices this year, according to the Victoria County Clerk’s office.’
‘The numbers don’t correspond to what banks are seeing, said Kenneth Early, banking center president for Prosperity Bank. Banks are held under governmental standards that many mortgage companies aren’t, he said.’
‘The trend in the nation is that these mortgage companies made loans that the banks wouldn’t make,’ Early said. ‘There’s reasons the banks didn’t make the loans and the reason is showing its face now.’ Calls to local mortgage companies were denied or went unreturned.’
‘Stephen Jabbour attributed the increase to pressure on mortgage companies’ financial bottom lines.’
‘SanAntonio remains one of the best housing markets in the country. But that doesn’t mean that what happens with the national housing slowdown won’t affect home buyers here.
“People think San Antonio is not affected, and we haven’t been affected as much as places like Florida and Las Vegas,’ Gardner said. ‘But we are affected. We have an increase in inventory in both new and used houses. That’s a result of fewer people qualifying for loans.’
‘It also can create a confidence issue, Allsup said, even though it shouldn’t. ‘Basically you hear the sky is falling,’ Allsup said. ‘Buying a home in San Antonio is still a good investment. The industry is going to have to combat the eroding of consumer confidence.’
‘The North Texas housing market continued to lose ground in July. Pre-owned home sales dropped 3 percent from a year earlier, with 8,549 homes sold, according to new statistics from the North Texas Real Estate Information System. Pending sales for August were also down about 5 percent.’
‘Median sales prices rose a scant 1 percent, but that increase is mostly due to the falloff in sales of low-priced homes, analysts say.’
‘So far the drop in pre-owned home sales has not been nearly as steep as in the new home market, where business was off almost 20 percent at midyear. Dallas housing analyst Ted Wilson said that homebuilders may have relied more heavily on subprime loans. Those mortgages made it easier for buyers to purchase homes but have had higher foreclosure rates. Lenders have now sharply curtailed such mortgages.’
‘Also, many new-home sales have fallen through because buyers were not able to sell their own homes, he said. ‘They continue to see high cancellation rates from contingency sale buyers – the consumer has to sell his existing house before he will close on the new home,’ Mr. Wilson said.’
‘With July’s decline, total home sales are down about 6 percent from the first seven months of 2006. At the end of last month, about 50,000 homes were listed for sale through the Realtors’ multiple listing service.’
‘Buying a home in San Antonio is still a good investment.’
Uh, that would be negatory. Homes are a poor investment anywhere in Texas. Not only do you have massive property taxes that cause your carrying costs to skyrocket, but usually you’re luck to sell it for what you paid.
I love renting in Texas, home-owning not so much…
As a former homeowner in San Antonio, I can only say, too true, too true. Bought an OK house back in 1988 for $85,000. Because of job transfer had to move in 1996. The company made an offer of $90,000. On the market for 3 months at $92,500. Not one nibble. Thank goodness my employer took that place off my hands for the $90,000. I was less than thrilled at the time. Now I realize just how lucky we were.
As far as the Metroplex, the ONLY area people should even consider are the Park Cities. Even that area is probably trouble. I certainly would never consider buying in Texas ever again.
And notice the heavy use of tax subsidies to encourage building.
In general homes are a poor investment period, compared to others.
“The industry is going to have to combat the eroding of consumer confidence”
Calling Helicopter Ben: bring cash, drop it on top of my house, pay off my credit card debt, pay off my student loans, and double my home’s value.
Bingo. Problem solved.
And oh yeah, gas will be now $12 per gallon, and your food bill will triple.
Notice the fall of the dollar today against all major currencies except the yen, because the yen was too heavily involved in carry and trade.
This will make things worse over the long run not better, because investment in us and us dollar will decline. US government will have to pay more to finance its deficit. Hope Bearnanke knows what he is doing.
My neighborhood used to be a nice quiet place in the Katy exurbs. Now the exurbs are 10 miles west. 11 years ago when we bought the house, Fry and Mason roads were 2 lane with relatively little traffic. Now they are both traffic-clogged hellholes, packed with kids driving massive pickups or rice rockets blasting out stupid heavy bass “rap” music. THUNK THUNK THUNK BOOM THUNK THUNK. Where do they come up with the money for all that bling? Where do they come up with the money for all these pearl-colored gold-plated Escalades? I’m driving around in a Toyota that is pushing 8 years old, these little creeps who are maybe 20 are driving $30,000 vehicles. THUNK THUNK THUNK THUNK BOOM THUNK THUNK
God help the people living on Fry Road up near 529. Thousands of cheap houses with people facing lengthy 30-minute commutes JUST TO GET TO THE NEAREST FREEWAY. Maybe they can just move into their Escalades. All the former apartment dwellers in Alief moved out there - buy a house for $650/mo! Sweet! It’s already turning into gangstaland. I am seeing graffiti (the area was rice farms just a decade ago) but I expect to be hearing about murders out there soon enough. Unincorporated Cy-Fair Exurbia will become a hellhole. Glad I’m 10 miles away from that disaster. We have problems in Katy, but 529 is gonna look like Mad Max.
“‘Buyers are looking for a bargain and they want to see everything out there.”
More like bargainers are looking for a buyer…
Ben, be sure and read the Dallas Biz Journal article about Craig Hall’s market call. That’s a biggie.
“People think San Antonio is not affected, and we haven’t been affected as much as places like Florida and Las Vegas,’ Gardner said. ‘But we are affected. We have an increase in inventory in both new and used houses. That’s a result of fewer people qualifying for loans.’
This will kill what’s left of the Texas market. Texas credit quality has to be some of the worst in the U.S. and if prices don’t come down to FHA/VA loan levels on a wide scale, turn the lights off.
Sprague said new jobs being created by high tech companies, such as Samsung, as well more people moving into the area, have cushioned it from feeling a major ripple from the national market.”
You mean like those Dell layoffs in Round Rock? Next
Are they still talking about Samsung? That should be a running joke by now. Like SA getting all nuts over 700 Toyota jobs for years.
I agree that sellers have to get real.
“‘We’re in a great bubble here in Austin,’ he said.”
As opposed to a nightmare bubble like the rest of the country….
My company has an office in Austin… Was there a couple months ago… the construction rate was amazingly high. Everywhere I looked in the northern suburb hill country was being filled up with condos.
I’ll be back there tomorrow for the rest of the week. Maybe I’ll try to start a conversation with som elocals to see if I can judge market sentiment.
Condos, condos, everywhere, nor anyplace to plant a tree. Can’t ANYone build a normal house on a normal lot anymore?
Donknow about Austin, but San Diego has run out of land, except for that used to build $1m+ Supersized McMansions on large lots.
“Finch’s advice to sellers: Spend a little money to make improvements and add value to a home, as a cushion against buyers’ expectations of a price discount.”
Huh? This statement made no sense to me whatsoever. Darn FB-speak translator must be on the blink again.
I think it means “buy a gazebo at Target and you won’t have to make price concessions”.
Or maybe replace the wall paper with Krugerrands glued to the wall, that way you beautify the house making it all sparkly and actually add value to not have to talk about a nasty price drop.
Bingo! Now they have to employ flipper tactics just to break even. Does anyone still fall for the Koi Pond Maneuver?
“Does anyone still fall for the Koi Pond Maneuver?”
The Koi ponds are good for about $20,000 on the sale price. Right?
Spend $20K fixing up the house so that you only have to drop the price by $20K instead of $40K.
That way, I make comission off the $20K you spent fixing up the house, and I REALLY need the extra $1200!!!
Actually, the way many people ignorantly “invest” their money in home “improvements,” they’ll probably spend $20K fixing up the house so that you only have to drop the price by $35K instead of $40K.
Exactly. This may help a few neighborhood comps and realtors’ pockets but how does it really benefit the seller?
OMG…you guys totally nailed it.
“Finch’s advice to sellers: Spend a little money to make improvements and add value to a home, as a cushion against buyers’ expectations of a price discount.”
Granite countertops? Pools? Lawd.
We sold in June (Thank heavens) in FL Panhandle and did some cosmetics…paint, tidy, yard. Priced it right and it flew–first looker bought her.
What planet are these people on? Jeesh.
From the original post:
“Cross-town buyers are usually sellers, and ‘They want it both ways,’ she said, top dollar for the house they’re selling, the best price for the one they’re buying. They don’t usually win on both ends, though. It’s a buyer’s market, so they win on the buying end, she said.”
Anyone care to translate this? It looks like heavy Realtor-speak.
I belive what the realator is saying is that people are selling a house and buying a house. The people want to get the best deal for thier purchase and they want to get as much as possible for the house they are selling. Can’t have it both ways.
“They want it both ways” = I live in my own private Idaho, surrounded by sunshine, rainbows, and me and Goldilocks are BFF
“They don’t usually win on both ends” = means there’s a chance they will win on both ends
“they win on the buying end” = FB
Someone hears that new homes are selling for $150K off peak price, so they put down a small deposit and they list their existing home at peak price. After 6 months, the existing home doesn’t sell, so they walk from their tiny deposit and take their existing home off the market. The realtor gets no comission.
She’s saying, instead of walking away from the new house, since you got $150K off the new home you should be willing to drop you old house’s price by $150K so that you can sell and she can bank some kind of comission, even if less than the original amount she envisioned.
As I said last month, it is no longer time to work on the buyer’s psycology of “great deals out there, get them while they last”. The few buyers out there that can qualify are smart enough not to buy at today’s market price. They need to turn around and start pounding on seller psycology. Drop the price now… because, only after prices have dropped can transactions pick up again.
You lose as a seller since you’re desperate or wouldn’t be selling, and will take a loss.
But you win as a buyer.. and simutaeously lose as a buyer since the property is a falling knife.
So, my translation is : It’s a buyer’s-seller’s
markettoilet. Come on in.. the water’s fine.” ‘We increased homeownership a whole bunch in the past five years,’ says Baen, the UNT professor,…”
Baen should know — he’s got gobs of experience on the tenure track at UNT, where he gets loads of research grants.
Luv,
Jen
” ‘We increased homeownership a whole bunch in the past five years,’
…and foreclosures too!
“a whole bunch”
Being an engineer I’m curious as to the technical definition of “a whole bunch”. Is that a little more than “a smidgen” but a little less than “a butt load”?
Com’on prof, how about some actual numbers? We on the board already know what they are, but it might be illuminating for the rest of the country to have an idea about the massive number of recent new homeowners who are about to enter foreclosure….
…I’m curious as to the technical definition of “a whole bunch”. Is that a little more than “a smidgen” but a little less than “a butt load”?
That was my point.
Luv,
Jen
“Being an engineer I’m curious as to the technical definition of “a whole bunch”
Isn’t a bunch a some fraction of a bushel? So I guess a “Whole Bunch” is when your not getting screwed and getting the “Whole Bunch” and not less than a “Whole bunch”.
Jen,
Are you north of Dallas?
Sorry, Ben, no. Go west, young man.
Anagrammatically yours,
Jen
“Plans for a $4 billion, 3,500-acre development in Leander that would have clustered homes with parks and commercial developments, as well as more than doubled the city’s population, have folded.”
Anyone who thinks they are such bot sh!t that they can double the size of ANY town simply by building houses and parks is completely retarded. Oh, yes, there is such pent up demand in Leander! Duh, just ’cause you build it doesn’t mean they’ll come.
Good point. There are not a lot of commercial jobs centers / office parks in Leander. Its like Pflugerville - just row after row of subdivisions. If a town is to be sustainable, it must have a mixture of retail, residential and commercial. Not just builders going nuts with spec houses. The problem with many of the outlying Austin communities is that there is simply no planning. Just a quick rubber stamp at the City Hall and you’ve got your permits.
Also, any word if this developer was planning on building roads, schools, and a water treatment plant - or were they going to over build like Taylor and worry about infrastructure later?
As I’ve said before, Texas is the example I point to when making the case that this bubble has gone on far longer than most think. Builders have been going full bore in Central Texas for 15 years or more. All this will out much thought as to what will sustain it. Truck stops for the NAFTA trucks will only go so far.
Don’t worry Ben. They’ll run out of land sometime.
them and Utah - nevada, too, whoops, and did I mention AZ and CO??
“Plans for a $4 billion, 3,500-acre development in Leander that would have clustered homes with parks and commercial developments, as well as more than doubled the city’s population, have folded.”
I think this situation calls for a new term: CFB
Clustered FBs
–
“Buyers Are Looking For A Bargain”
We can thank Wal-Mart and all the frequent Sales for that. Once people get trained in bargain shopping for homes we will get our deflation. And who doesn’t like lower prices?!
Jas
PHX area now soldily over 55,000 houses for sell in Maricopa coounty. I bet lots and lots of houses that had been under contract will be coming back to the market. Lots and lots of houses that had been taken off the market to be rented out while waiting for conditions to improve will be coming back to market.
With transactions set to plummet based on tightening lending standards, I would not be shocked to see months of supply jump from 1 year upto 2 years within the next couple of months.
Supply skyrocketing, demand crashing, prices well above support levels… Hmmmm… Wonder what affect that will have on prices.
It’s all good, Darrell! HeliBen is now looking for any excuse to institute an emergency drop in the Fed rates, the FHA mortgage cap will likely soon be increased to an astronomical amount, and, oh wait, none of this is going to help the totally f’ed housing market, is it? Never mind.
I came to my senses and made an offer on the place I liked 18% under the asking price, and that is generous. I’ll go as high as 12-15% under but no more. I did a little research and the owner owns this place free and clear.
I hope you get it.
fingers crossed for you, TX
I hope you get it for the low price, especially if you really like it. I was in a similar situation last year. But be prepared to live in a depreciating asset for the next ten years.
I don’t want to move again. So it will be 25-30 years.
found out why she’s selling?
no mortgage so it probably isn’t a money thing.. and her husband’s death is not necessarily a reason to bil out under the worst of market conditions..
and to be clear.. yeah.. i’m skeptical.
Is it in TX?
“It’s easy to blame California, Florida and Nevada, where the housing bubble is going pop. But this is a bill that we ran up, too, and it had to be paid sometime. ‘It’s going to be a cold winter,’ says John Baen, a real estate professor at the University of North Texas, who predicts tough times ahead for housing and the broader economy.”
You know, I have to wonder how many texas foreclosures are due in part to people taking equity out of their homes. for many years it was not legal in texas. i lived in dallas for a while in the 80’s when there was more and more pressure being brought to bear by financial instutions to allow it. and of course they eventually won. the state’s concern had always been that more people would eventually lose their homes.
Yes - also, in Texas we don’t have the rapid aprecaition seen in California. So, when you pull $30K out of a house, it brings you back to being even. Even a stall in the market will put a lot of these people underwater if they try to sell.
This is starting to become a problem in California as well, it seems.
We don’t have the rapid appreciation, previously seen in California, in California either.
who knows how many, but a whole lot of people have been steadily sucking on equity for many years.. few cared about and fewer noticed any changes in the market..
Just reply to the bank’s junk mail and get some money for whatever lame excuse seems appropriate at the time..
I’ve been harping on that here on this blog for over 2 years. It’s a huge factor because since home equity lending was allowed here in 1998, there has been no significant downturn in the market.
Good point. That change hasn’t been tested yet. I bet Texans will put that back in the constitution after this bust.
There I disagree, Ben.
Too much corruption to let that happen.
Thanks…i was going to ask someone if they knew when it became legal. didn’t realize it wasn’t til 1998. i left in 1991 and was thinking it was around that time. you’re right, it’s a huge factor.
And the other half of that is the psychotic need here to appear to be “wealthier” than you are. It’s a sport in Dallas. That takes money which most of them don’t make nearly enough of. So the house equity is sacrificed.
I had an email exchance with Jumbo Cramer back in late 1997 urging him to first go long Texas home equity lenders such as NCNB, Bank One, Bank of America, et al., and then go short for a long term very profitable play. So you see, my bearish view on TX goes back ten years or more. I didn’t think it would take this long to play out but now that it has, watch out!
what’s in your wallet ?
–
AP
Capital One to Close Mortgage Unit
Monday August 20, 4:51 pm ET
Capital One to Close Wholesale Mortgage Unit; Charges Will Total $860M
MCLEAN, Va. (AP) — Capital One Financial Corp. said Monday it will close its wholesale mortgage unit due to woes in the secondary mortgage markets, resulting in $860 million in charges in 2007. The company, which said about 1,900 positions will be eliminated due to the closing of the unit, added that it will “cease residential mortgage origination” at the unit, called GreenPoint Mortgage, effective immediately.
http://biz.yahoo.com/ap/070820/capital_one_financial_wholesale_mortgages.html?.v=2&printer=1
What’s in my wallet? Unless I’m going to need it while I’m out and about, the credit card stays home. And, no, it’s not a Crap-ital One card.
That would explain why they just bumped the interest rate on my fixed rate credit card from 14.9% to 19.9%. Of course being a recent grad in a field that doesn’t pay a whole lot, I still have too much debt to pay down. About $1300, but it could take me a little bit longer.
Capital One makes it official by closing down GreenPoint. The BLS guys need to get cranking on their birth/death model to make up the 1900 Capital One jobs lost today!
What’s in your wallet?
Latest word is that the 1900 employees are actually illegal Vikings and not considered part of the work force. The BLS need not re-jigger their model.
LOL, all here on B-1 visas I suppose? Turn those longships around, Erik.
No, wait! They will need those illegal Vikings to serve as muscle when it comes time to collect the moola from the FBs. It will have to be extracted forcibly in many cases, just as some of the FBs will have to be extracted forcibly from their former residences.
Then they can rent the Vikings to the bank REO departments to keep the squatters out of their vacant properties. And to the auto repo companies to collect the Beemers and Hummers for storage in the desert.
I see a bright future for Rent-A-Viking companies. Muscle to go.
are these the same guys that sit around in the restaurant sing “spam, spam, spam spam…”??
“In North Texas, the largest concentration of foreclosures involve starter homes and subprime loans to people with poor credit. ‘We increased homeownership a whole bunch in the past five years,’ says Baen, the UNT professor, ‘but the great American dream became a nightmare for a lot of these people.’”
The loans at night, give many a fright
Debt in the heart of Texas
The preyed on sigh, oh why oh why?
Debt in the heart of Texas
The loan ballon, is financial doom
Debt in the heart of Texas
Reminds me of the foreclosure shove
Debt in the heart of Texas
The foreclosed on wail as they fail
Debt in the heart of Texas
The sheriffs rush, giving folks the brush
Debt in the heart of Texas
The loanboys cry “Ki-yip-pee Yi”
Debt in the heart of Texas
The homeowners, bawl and bawl and bawl
Debt in the heart of Texas
OT: During yesterday’s debate [sic], each candidate was asked whether he/she believes that the federal government should help stem the current tide of residential foreclosures. Only Kucinich answered “no”.
Kucinich/Paul ‘08
“Four more ears! Four more ears!”
“Four more ears!” LOL.
http://news.aol.com/elections-blog/2007/07/24/kucinich-paul-in-08/
Kucinich .. this guy’s perfect.. Contribute big to his campaign.. he can’t lose.
I don’t know if anyone has posted this yet.
Its huricane season kicking up . A lot of the losses will track back to big financial houses. Wonder if exposure to mortgage related losses coupled with a huricane or two will topple any of the big banks/insurance firms.
The ARM peaks along with other real substantial losses
the more potential buyers wait, the better bargain they are likely to get. the full impact of tighter (ie normal) lending standards is yet to be reflected in house prices. the credit spreads have widened but that is from abnormally low values of past few years. Economist has a chart showing spreads now are just back to normal of 90s. The sellers are still in denial of bubble, next phase is anger and then acceptance. 08-09 earliest it can bottom and then it’ll sit there for a while. btw, if you do not want your savings to be lent to homeborrowers via bank move it t-bills, muni bonds, foreign currency ETFs, gold etc from banks like wells fargo, countrywide, bank of america etc.
so if i buy Tbills, the govt won’t use that money to invest in mortgages.. and if i buy foreign currency, that country won’t either?
very cool..
“Now if I worked for Goldman Sachs, Morgan Stanley, Merrill Lynch or the other big US investment banks, I might be considering my career options at the moment. It is inconceivable that they will escape unscathed from this debacle. Whatever the financial cost to these banks, which will not be trivial, there will also be significant damage to their reputations.”
http://www.bbc.co.uk/blogs/thereporters/robertpeston/2007/08/liars_loans.html
great post
The hits keep coming……………..
VALERIE BAUERLEIN
August 20, 2007 4:38 p.m.
Capital One Financial Corp. plans to shut down its struggling GreenPoint mortgage unit, becoming the latest casualty in the mortgage meltdown.
Capital One bought GreenPoint in last year’s $13.2 billion purchase of North Fork Bancorp, of Melville, N.Y. North Fork had earlier paid $6.3 billion for GreenPoint Financial Corp., then a large N.Y. savings-and-loan specializing in mortgages.
The unit specialized in so-called nonconforming loans, which do not meet the standards set by Fannie Mae and Freddie Mac, the government-sponsored providers of mortgage funds. GreenPoint specialized in “jumbo” loans above the $417,000 limit and Alt-A loans to home buyers who do not fully document their income or assets.
Citing great difficulty selling loans to the secondary market, Capital One officials said the bank will closing GreenPoint’s 31 locations and eliminating 1,900 jobs immediately. The credit-card giant said the subsidiary would not make any more new mortgages but will fund those in the pipeline with locked-in rates.
so not only did the price of homes increase 2+ fold, but so too did the price of the mortgage companies..
billions of dollars..for what? leased space, PCs, phones, customer lists, etc.
ok, now if Capital One can’t carry a non-performing asset, who can?
there is nothing that I can think of that wastes shareholder money like acquistions..yeah, sure, it’s all about synergies..
“‘We’re in a great bubble here in Austin,’ he said.”
Too bad today’s great bubble often morphs into tomorrow’s great bubble bath.
I posted this on another thread but no one seem to respond:
Has anyone noticed that something strange is happening on foreclosure.com. Over the weekend, instead of the latest numbers they were quoting the May figures. Now, while they claim they are up to date, they appear to be showing numbers from about June. In areas I have been checking they are showing houses as new to the site that were on there in June.
On Friday, the total list had risen to almost 1.5 million but on Saturday it had dropped to 1.1 million but it had a May date. Now, it is about 1.3 million but if you look at the county lists it appears that these homes were on the list in early June. I check the list for Clinton County NY and Chittenden County Vermont almost everyday so I recognized the listings.
OT..
I know you have all see the rate reset chart, but have you had a chance to look at the entire document that chart was pulled from?
It is a good read. warning, it is a 67 page PDF
http://www.recharts.com/reports/CSHB031207/CSHB031207.pdf
Took me several hours to go over it, it was very informative. Thanks
All hope is lost. This will never end.
Van Pelt paid $210,000 in cash, including a 5 percent auction fee, for a doublewide mobile home and a two-car garage with an apartment over it in Wildomar. Van Pelt, 55, said she bought the place for her adult grandchildren who now stay with her Menifee. She said the property is a fixer-upper but a friend who accompanied her to the auction has agreed to do the work.
Van Pelt said she hopes the property will increase in value and become a nest egg for her retirement.
“I am so excited about this because it seems like it is a new beginning,” she said.
“It looks like a good time to buy when values are down,” she added.