There Has Been Some Adjustment In California
The Recordnet reports from California. “Jerry Abbott, co-owner of Coldwell Banker Grupe, said the sales pace has quickened since September. He attributes some of that to an increasing willingness by banks to lower prices on the rising number of foreclosure homes in the area and to negotiate more realistically to sell properties that otherwise have languished.”
“Sales figures based on MLS data, showed that pending sales doubled from September to October. Granted, most sales are foreclosures, he said. ‘I think we hit the bottom of the market in September for sales,’ he said.”
“A total of 1,932 homes were repossessed by banks and mortgage companies in San Joaquin County in the first three quarters of this year, according to RealtyTrac.”
“‘For a long while there, you’d hold open houses and nobody would come,’ said Art Godi of Art Godi Realtors in Stockton. ‘Now we’re getting traffic and offers.’”
“The downside is that offers often are quite low, because buyers are hearing that ‘you can get a house for whatever price you want now,’ he said.”
“Lodi resident Antoinette Herrera said she and her husband were motivated by good prices to start shopping for another house in September. They recently bought a Morada foreclosure property - 1.2 acres and a house, which they plan to remodel and move into. They intend to keep their current home as rental property for an investment.”
“They competed with a few others to get the Morada house, she said, so they put in the then-full asking price of just less than $500,000 to get the house. But they figure they saved as much as $300,000 off the original asking price for a house that had been on the market for many, many months, she said.”
“Joe Anfuso, CEO of Stockton-based Florsheim Homes, said that although lower interest rates will be a positive force when the residential market settles down, they aren’t affecting the new home-sales market at all now. Actually, pricing isn’t either, he said.”
“It’s ‘buyers’ psychology,’ which continues to be negative about home buying so long as prices continue to drop, he said.”
“‘It’s really more the fear of: If I’m buying today, are prices going down tomorrow?’ Anfuso said. ‘There’s no sense of urgency.’”
The Mercury News. “Three home builders sat down recently with reporter Katherine Conrad to discuss the besieged housing market.”
“Q: What are you doing to sell homes? A: Vicky Nyland from Taylor Woodrow Homes: ‘A lot of projects we have had to discount the houses before we put them on the market. When we were going through the entitlement process on Modern Ice, we thought we would be in the $500,000 range. We didn’t think we’d be in the $400,000s. There has been some adjustment.’”
“A: Scott Menard from SummerHill Homes of Palo Alto: ‘Now our homes include upgrades such as granite countertops and landscaping. The buyers don’t ask about the price any more, they ask: What are you offering? We have no published incentives. Our traffic numbers are down but the market still looks like it’s OK - except for the bad press and that makes people more paranoid.’”
The Merced Sun Star. “Banks and mortgage companies could soon lend a hand in maintaining vacant houses abandoned to foreclosure.”
“The City Council voted 6-1 Monday night to ask lenders to keep up such properties, which are blighting neighborhoods across the city as Merced’s foreclosure rate continues to rank among the highest in the nation. The council considered four different options on how to keep lawns green and yards clean at such houses.”
“Before the vote, Mayor Ellie Wooten read an e-mail from Merced resident Kathy Price urging the council to not spend public money to maintain foreclosed properties.”
“‘I don’t want city staff time and my tax dollars spent on cleaning up yards because some lender allowed loans to the unqualified,’ read the message.”
“But another resident, Lisa Kayser-Grant, urged the council to move fast to address the problem even if it meant spending tax dollars. She told the council that a vacant graffiti-scarred house in her neighborhood had become a danger. ‘We need someone to protect us, and I think it’s you,’ Kayser-Grant told the council.”
“Merced isn’t alone in looking for solutions on how to care for vacant houses. Modesto recently put $50,000 from its general fund toward maintaining abandoned properties.”
“In Manteca, a new set of laws designed to tackle the problem goes into effect this week. The city’s police department will now be allowed to board up and secure vacant houses, but only if they’ve been deemed a safety hazard, said Police Chief Charles Halford.”
“The city will also have the power to slap homeowners with fines of up to $1,000 a day, up to $100,000 per house, for not maintaining their properties. Manteca will start its cleanup program with vacant houses that have completed the foreclosure process and are now owned by banks.”
“That way there’s a responsible party to threaten with those hefty fines, said Halford.”
The Bakersfield Californian. “After two delays, real estate agent David Crisp’s lavish Seven Oaks mansion has been repossessed by the lender. The home was up for public auction on the steps of City Hall Monday, with an opening bid of $1.8 million.”
“With no bidders ready to swallow that price, the 6,666-square-foot home went back to the lender, identified in county records as Irvine-based X Bancorp.”
“More than 100 defaulted Bakersfield properties have been linked to Crisp, Cole, their family members and their associates, a Californian tally shows. As of Thursday, 102 properties with more than $62.3 million in total loans can be traced to associates of the former Crisp & Cole Real Estate agency, according to The Californian’s ongoing survey of public records.”
The Orange County Register. “Cal State Fullerton professor Michael LaCour-Little has done a study looking at recent sellers of O.C. homes who sold for less money than they paid. (And that’s losses without transaction costs figured in.)”
“He found ….37.6% of all sales he tracked resulted in a loss. Typical ownership tenure of losers was two years. The average loss, in dollars, was $109,514.”
“He was startled by how the size and scope losses grew as the year progressed. For example, losing sales were slightly more than 20% of deals tracked in January but nearly 70% in October. ‘I didn’t expect to see so much of a time trend,’ LaCour-Little said.”
“Option One Mortgage Corp. will shut down its lending operations, close three offices and lay off 620 people nationwide after a deal to sell the subprime lender fell apart, parent company H&R Block announced today.”
“‘Obviously Irvine is affected, but as far as numbers, we’re not doing breakdowns,’ said H&R Block spokesman Nick Iammartino from Block’s headquarters in Kansas City.”
“The Irvine office has already lost at least 350 jobs this year as the company slashed staff in the wake of major losses as subprime lending dried up. Option One and related businesses lost $193 million in the quarter ended July 31.”
The Hesperia Star. “I’ve accepted the idea that the housing market is affected by cycles in the economy. I’ve observed for myself that there are buyers markets and sellers markets and sometimes events unique to us put us into the housing market at a disadvantageous time. I learned from economics not to be tempted to put blame for these cyclical corrections on the people who are losing their homes.”
“I worked at a savings and loan in the late ’60s in what was called the Real Estate Owned Department. At noon each Friday the manager of our department held public auctions trying to sell these homes. In those days one bought a home to live in not to speculate with so no one showed for bidding unless they were in the market for a place to live.”
“Later…during the late ’90s…because the economy was otherwise straining, the housing market was hyper-activated when lenders offered refinancing carrots that put money into the hands of the homeowners. They were supposed to spend us back to affluent times. It worked for awhile.”
“Builders learned from their mistakes in the ’60s and now build in stages. They no longer make interest payments while waiting for potential buyers. They only construct the houses for the buyers who have signed on the dotted line.”
“Homeowners now have the risk when the market goes belly up, tanks, tumbles, bursts its bubble, or is described by other clever slogans used to mask the fact that some real people lost their homes and it may take years to recover.”
“But we don’t have to fall down and play dead yet. I believe there are buyers for our homes. They just aren’t in town at the moment.”
“But we don’t have to fall down and play dead yet. I believe there are buyers for our homes. They just aren’t in town at the moment.”
-Don’t forget to cut your selling prices in half when they come back to town.
‘you can get a house for whatever price you want now,’ - that’d be AWESOME!
Yeah…but you’d still be in Stockton.
I read a report one time about Stockton that said half the population has been incarcerated. I guess the other half (loan brokers, appraisers, etc.) could join ‘em………….
Yes, trapped. Also to be known as “Buy now and be priced in forever”.
You are assuming that none of the half that has been incarcerated did not become loan brokers, appraisers, etc upon release. Foolish assumption!
That would be 50% off current asking at a minimum more in some areas. I do not see this happening right now. 10% perhaps, but not even in the ballpark yet.
See my post below on what I observed in the month of November in my local market.
“Jerry Abbott, co-owner of Coldwell Banker Grupe”
Is this part of the Fifth Panzer Realtor(TM) Division?
lol. Not a bad idea, when they can’t sell ‘em, they bulldoze ‘em.
must … resist … making … a … colonel …. klink (= hogans heros) … joke
Recession? What recession? I see nothing, I hear nothing.
Now that’s funny.
So do we call the guy Herr Oberkurfurstfeldmarschallhauptmannbefehldshaberkommander Jerry Abbott, or what?
Assuming this doesn’t work, how the $#$%# do you close italics once you’ve accidentally left one open?
test
“He was startled by how the size and scope losses grew as the year progressed. For example, losing sales were slightly more than 20% of deals tracked in January but nearly 70% in October. ‘I didn’t expect to see so much of a time trend,’ LaCour-Little said.”
What he calls a time trend, I call a crash.
Wow, that is a much more precipitous crash than I realized. Wow!
Enter Gary Watts for the pithy rebuttal.
Not sure if you guys have seen this, but Watts says 1) the downturn will end this month, and that 2) foreclosures will have minimal impact on the California market. Did you know that 8 billionaires live in Orange County? Guess we’ve overblown this whole bubble thing! Thanks Gary!
http://www.impactre.com/Forecast.html
It is self-evident that 8 billionaires will support the entire Orange County real estate market…
I’ll bet not one of them became a billionaire buying high and selling low, so not much chance they will save the market.
You can email Mr. Watts with your pithy comments here:
info@impactre.com
Have fun!
And exacty how many houses do those 8 buy? Compared to how many foreclosures are there? And of course they tend to live in REAL mansions, on sizeable tracts of land, not McMansions that have to be built with one wall entirely bereft of windows so the neighbors can’t look from thier kitchen into your bedroom.
Let’s see…..inventory in OC about 30% higher than this time last year…..yep, recovery on the way.
Next time I’ll use a bigger Joshua tree Mr Watts. Apparently the first one didn’t learn him.
Bloggers, is there a web where I can get some stationary with a Joshua tree logo? Would be neat to respond to sellers when requesting for price reductions.
pismo, if I wanted to do this, I would use the small discreet drawing of a few JTs in the lower left part of the Joshua Tree National Park website. It’s a black and white drawing, so you could cheaply photocopy it onto many many pages.
Couldn’t find stationary anywhere, but found a great Mojave Desert road trip site. First photo is a Joshua Tree! Also some donkeys and cool roadside attractions:
http://www.pbase.com/surfnmoto2/desert_road_trip_
It’s so stretched out that you may need poly grip to only have the Joshua rattle around like a BB on a 4 lane freeway.
They’ll be able to carry an armadillo and six bowling ball NO HANDS for the rest of their lives.
Isn’t ‘Watts’ and anagram for something? Brits will know what I mean to sumarize this guy.
Indeed !!
According to Forbes:
Fannie Mae’s quarterly financial filing for the third quarter said Fannie had $42.2 billion of private-label subprime securities and $33.8 billion of private label Alt-A securities.
Former Kramer associate goes to subprime heaven. I must confess, it is interesting to see a fund manager shuffle off this mortal coil in such a lurid fashion.
http://www.nytimes.com/2007/12/04/business/04tobias.html?_r=1&ref=business&oref=slogin
Very fascinating. Makes me want to come out of retirement. Unfortunately taking place in Florida makes me think that the case will be compromised. They need to send the toxicology specimens to the Center of Human Toxicology in SLC and ask for a full screen. Cocaine and alcohol are a no brainer to scan for but they need to look outside the box for things like Chlorohydrate, etc.
Salinas, are you a forensic toxicologist? Yeh, unfortunately, Florida has a way of messing up this sort of thing.
Yes I was a Forensic Toxicologist for 20 plus years. Enjoyed putting the bad guys away. Unfortunately too many inept Forensic Pathologists, toxicologists, and coroner investigators in the business.
Call Guido in N.J., the x book keeper for Waste Management. He will have an answer about the money and the snow.
LOL
Who says money doesn’t buy happiness?
I guess happiness is a warm “Tiger”. LOL! Where’s Leigh? I don’t want to steal her signature line, but I just gotta say it:
Ya can’t make this stuff up! Now that was a juicy read!
I just finished reading. My my.
Ya just can’t make this stuff up!
Testify, sistah!
$35K per month in mortgage???? How much was the house “worth”?
“His monthly cable bill from Comcast was $535.19.”
Wow. I wonder what you get for that.
“Tigervision”?
I wondered the same thing, Blue. How is that even possible?
“Her lawyers, which include her prior husband, Jay J. Jacknin”
And Mr. Tobias’ gay date on the night he died was a guy called Tiger, with blond hair and stripes tattooed on his body, though Florida police can’t find him.
Man, you guys do know how to have fun in Florida.
“Mr. Tobias’ gay date on the night he died was a guy called Tiger, with blond hair and stripes tattooed on his body, though Florida police can’t find him.”
LOL, Florida police can’t find him, figures. Maybe John Walsh will feature him on America’s Most Wanted. How does a guy like that disappear?
“How does a guy like that disappear?”
He could have his tattooed stripes changed to camouflage.
Combo, ROTFLMAO! You just made my evening, thanks!
I heard her 911 call recorded. Seemed more like a woman saying hurry up and get here so you can verify this dead guy and let me get on with Tiger. It was more anger than tearful. Who doesn’t know CPR in this day and time. Cradling the head is not what I consider making a valid effort.
You can see Carl Hiassen’s problem. He gets a nice, juicy maybe-murder in Florida, and then has to edit out half the details to make it believable. I personally love the fact that the bereaved Mrs. Tobias has her exhusband as her lawyer, considering she was married to the dead man fairly briefly, and he’s trying to get her the whole estate.
Who knows, in a perfect world, maybe these two lovebirds can get together again.
“But we don’t have to fall down and play dead yet. I believe there are buyers for our homes. They just aren’t in town at the moment.”
Dave’s not here.
Pretty bad when you have to resort to belief as a business strategy!
Palmy,
From the article:
There are folks down the hill approaching retirement age that would move here if they through they would fit in. We can give them more for their housing dollar and Hesperia could be a nice place to retire to if we were welcoming to new-combers instead of seeing them only as adding to the traffic jams.
Retirees would bring with them broad-base skills that are sorely needed on the High Desert. They wouldn’t be competing for jobs. They can apply their knowledge to nonprofit endeavors where they are sorely needed.
I’m not familiar with this area, but from the comments I read posted on the Cali thread, doesn’t sound like a place I’d move to! (With all my retirement skills).
LOL,
Leigh
Doesn’t sound like the place for me, either, but local boosters still seem to be hoping for that all-important wave of retirees and trying to invent reasons retirees might be attracted to their area.
As much as people put down retirees, I can tell you that they do make good part-time employees, at least, many of the employers around here think so. They tend to show up on time (Woody Allen said 80% of life is just showing up) and do their jobs without complaint. I’ve seen a bunch of them run a local charity thrift outlet and they treat their volunteer work as if they were being paid. They’re on the job at six in the morning. They’ve made a lot of money for scholarships and local charities. The majority are from the Midwest. You can’t beat the Midwest for work ethic.
Oh, please “you can’t beat the midwest for work ethic.” What a joke! Have you ever worked in the midwest? What a joke. I’ll take California workers any day of the week! I actually worked in the midwest with midwesterners. Which is why I say “what a joke!”
“They only construct the houses for the buyers who have signed on the dotted line.”
Oh Really ? I can find you a list of Spec homes at any Arizona building site.
And, as we hear every week or so, plenty of people who signed on the dotted line have been walking away from their deposits.
“Before the vote, Mayor Ellie Wooten read an e-mail from Merced resident Kathy Price urging the council to not spend public money to maintain foreclosed properties.”
“‘I don’t want city staff time and my tax dollars spent on cleaning up yards because some lender allowed loans to the unqualified,’ read the message.”
No problem, just throw weed killer on the lawn, water it in and then paint the dried up grass green.
“Merced isn’t alone in looking for solutions on how to care for vacant houses. Modesto recently put $50,000 from its general fund toward maintaining abandoned properties.”
Good business opportunity here, maintaining property for banks. Just go to your local Home Depot for you daily work crew.
This is another example of how the fake housing boom ends up costing tax payers money because the greedy borrowers won’t take care of their property and now the greedy lenders won’t take care of the property . Tell me if there is enough equity left over to pay for the City fines from the equity in the property . Tell me about the extra police or code enforcement officers the cities have to use to take care of house problems related to crime and health and safety problems . Look at the developments that remain uncompleted because of the builder running out of funds that now create a eyesore . Look at the fact that we have to look at all the for sale signs all the time ,that make you think the whole world is up for sale .
If anybody ever thinks that lending doesn’t need to be prudent ,think about what happens when lending isn’t based on sound principals and appraisals .
What will happen, particularly in California, is that the exurbs where it was easy for builders to buy a farm and cover it with houses, will collapse and turn into ghettos. As gas prices continue to climb, people will gravitate towards developed areas with transit and employment options. Places like Los Banos, that shouldn’t even exist, will take it in the shorts.
What gets me is the lady who says someone needs to protect us and it’s you. For 1/2 Saturday moring and some of paint she and some other neighbors could paint over the grafetti house. Worth protecting you property and neighboorhood. NO YOU RATHER HAVE THE GOVERNMENT DO IT AT A COST PROBABLY OF HUNDREDS OF THOUSANDS OF $.
Boo! Hopefully he didn’t see those numbers on Halloween or else he would have been really spooked. 6 months from now I expect the opening sentence to be “He was ashamed at his own incompetence and by how the size and scope of losses grew as the decade progressed.”
….
“He was startled by how the size and scope losses grew as the year progressed. For example, losing sales were slightly more than 20% of deals tracked in January but nearly 70% in October. ‘I didn’t expect to see so much of a time trend,’ LaCour-Little said.”
Please visit the Mercury News article comments site for some really amusing posts by “Math Wiz” on why Silicon Valley can never go down.
Mo, I enjoyed your posts much more
“‘Obviously Irvine is affected, but as far as numbers, we’re not doing breakdowns,”
Instead, we’re HAVING breakdowns.
“Sales figures based on MLS data, showed that pending sales doubled from September to October. Granted, most sales are foreclosures, he said. ‘I think we hit the bottom of the market in September for sales,’ he said.”
Every leg down is going to shake out the trigger-happy-ain’t-got-the-patience-to-wait-it-out fools. Now granted, there’s probably mixed in there a few souls that got the price they were looking for regardless of where the market goes. but for those that jumped thinking this was the bottom, you lose. You think this year was freaky, wait ’til ‘08 comes out to play.
They certainly didn’t say the housing market was doomed on the way up when sales figures fluxated from month-to-month! This sounds like new economics to me!! Kool-Aid anyone?
I love reading about the knife-catching dingbats who buy stuff at auction in the central valley for $200K than it sold for at the peak in ‘05. “I got a great deal!” Then six months later somebody buys the house next door for $250K off peak. Congratulations: you’re an idiot. But don’t fret, so is your neighbor, as they’ll realize a few months later….
As Cote always says, God Bless the falling-knife catchers. Without them, there wouldn’t be any comps to prove prices are falling.
The Ventura County Star had a article about an auction in Oxnard, where all the homes sold in an hour. The cheapest house a 3 bedroom 2 bath with loft sold for $425K.
But ,right now we are moving into a dead market ,where the value of property is hard to determine .That’s why interested parties want to call a bottom . The government wants to call a bottom to make it look like the bail out loans were not made knowing they would fall in value .
If you know something might fall in value you have to require a greater down payment to protect against that risk .
Oxnard is a not a poor man’s Malibu. I lived at the beach there, and the demographics, city layout, and weather, all leave something to be desired.
Those clueless people, who paid $425K for anything Oxnard, will reap their ‘reward’. Mororns. Taken in by ‘auction mania’, I guess.
“The city will also have the power to slap homeowners with fines of up to $1,000 a day, up to $100,000 per house, for not maintaining their properties. Manteca will start its cleanup program with vacant houses that have completed the foreclosure process and are now owned by banks.”
This is just the thing that Detriot started doing. Their intentions were good, what they didn’t realize was that very soon the house values would be so low that between the cost of bringing the house into compliance, coupled with the fines the owners were literally fleeing ownership. Many houses ended up deeded to the city via delinquent taxes, no one else could be convinced to take them. At one point the city had a 3 year backlog of houses to bulldoze because the city couldn’t afford to maintain them either.
“Sales figures based on MLS data, showed that pending sales doubled from September to October. Granted, most sales are foreclosures, he said. ‘I think we hit the bottom of the market in September for sales,’ he said.”
Most sales are foreclosures, but pending sales doubled - yeah we hit bottom! Ok Realtors, get out there and start cheerleading, “We Hit Bottom! We Hit Bottom!” I liked reading about market malaise better. The market is not yet underwater. The market is awaiting the goldilocks fairy and glass slippers, but those are in children’s tales.
We might indeed not be too far off a bootom here in Miami. The few houses that sell do so at incredible discounts. Offered late 2005 @ $350K, sold last week @ $135K. Slowly things are returning back to normal. A foreclosure down the road from where I live, sold 9/2005 for $425K now offered at $180K.
Of course the majority of sellers are still holding out for their wishing prices but the tide is turning. There’s actually some movement in the market now brought on by foreclosures and auctions at fire sale prices. Lots of angry bag holders to go along with it all.
Have you ever seen a real estate V-bottom? Nope. You never need to be in a hurry to buy.
Damm right I’ve seen a V bottom before. Colorado in 1988. Brick 3 bdrm 2 c garages townhomes going for $22,000. You could rent them out for $450 the next day. Will it happen again? You betcha.
In 1987, when we sold our spacious subdivision home for $94,000, my husband was afraid all the neighbors would be mad at him for raising their taxes. He’d had the house built for $41,000. Gradually, starter homes crept up to that mark there in the suburbs of Detroit - I fully expect to have those starter homes go back to ~$60,000 once again - that is, if you want to sell them!
“They competed with a few others to get the Morada house, she said, so they put in the then-full asking price of just less than $500,000 to get the house. But they figure they saved as much as $300,000 off the original asking price for a house that had been on the market for many, many months, she said.”
I’d like to see how Ms. Herrera qualified for the new loan and how it is structured. Another question is did she actually get the loan yet or is she in the process of trying to secure one? I’d also like to see the figures of her debt to income as something just doesn’t sound right.
The “competed with a few others” coupled with “$300,000 off the original asking price” raised a giant red flag for me. I have yet to see *anything* approaching that large of a peak-price haircut in CA so far, even way out the sticks. And if she was really participating in a bidding war, why would the seller slash so drastically (assuming the place wasn’t horrednously overpriced to begin with)?
I live in the Central Valley by Stockton.
Cringed when I saw the nice bungalow I was raised in was sold and noticed there were on average 4 or more cars parked out front, people milling in and out over the months.
Told my girlfriend the place would foreclose within a year. She thought I was being too harsh. Sure enough, little over 6 months later and house is in pre-foreclosure.
Knife Catchers.
DOC
saw the same pattern with some gypsies that moved into a house that sat unsold for a year,then went to rent. The gypsies parked at least 8-10 cars outside, did bodywork in the front drive & more. Reall brought down the entire area. finally disappeared after a year.
Old Trashy RV out front is still there abandoned.
So many fallacies, so little time to debunk them all…
“Builders learned from their mistakes in the ’60s and now build in stages. They no longer make interest payments while waiting for potential buyers. They only construct the houses for the buyers who have signed on the dotted line.”
Why, sure they ‘learned’ this time. That’s why there’s nearly 6 million empty houses for sale, “dark towers” all over San Diego, Florida, NV, nearly-empty flippertowns nearby me in Riverside, San Bernardino, Palmcaster, etc., etc…
“Homeowners now have the risk when the market goes belly up, tanks, tumbles, bursts its bubble, or is described by other clever slogans used to mask the fact that some real people lost their homes and it may take years to recover.”
It WILL take years to recover, that much is true, but these price-appreciation seeking speculators were never “homeowners” in any sense of the word. The speculative assets they bought with the banks money was never “theirs” to begin with. They are –and always were– “money renters”.
“But we don’t have to fall down and play dead yet. I believe there are buyers for our homes. They just aren’t in town at the moment.”
Believe It and They Will Come. The “Field of Dreams” approach to house selling. Or is it Cargoism?
I really wanted to blow a fuse when I read this. Didn’t overbuild? ROTFLMO
Stages? Sure. But they didn’t stop and wait to see if they sold out a previous stage before starting another five or six!
“Clever slogans?” why, are we so popular to be a movement already? I haven’t see the bears marching, did I miss it?
The housing bulls have a long mental adjustment ahead of them. Its not the renters whom are running out of cash.
Got popcorn?
Neil
The reason why you are “ROTFLMO” is that the last time you ROTFLYAO, you actually did laugh your a$$ off, and it hasn’t come back! am I right?
Yes, its my new diet program. Only $99.99 for the DVD.
And here I thought popcorn was a diet food.
“They competed with a few others to get the Morada house, she said, so they put in the then-full asking price of just less than $500,000 to get the house.”
Went back to the original article and they are also planning to make some upgrades. This deal really smells.
I put this in the earlier topic. the TED spreads have widened to the highest levels since around the 1987 crash.
http://ftalphaville.ft.com/blog/2007/12/03/9336/ted-spread-widens-to-highest-since-1987-crash/
That is darn interesting… wonder who is trying to borrow all that money ? Hmmm….
Well that should be dandy news for dips buyers! Because everyone knows the U.S. stock market tricked myriad sheeple into getting out (thanks to that scary 20 percent one day drop) only to learn a couple of years later that the stock market always goes up.
bill in maryland will lead the charge!
ok, I’m putting the saddle on the horse now.
From what I read on the HBB, we tsk tsk people who became Trumb wanna bes, yet most of us here never put a dime in 401ks and do not understand dollar cost averaging, low expense mutual funds, and the fact that stocks earned the most gains since 1926 compared to any asset (real estate, metals, bonds, cash).
There!
I’m putting $8,000 into stock mutual funds in January, primarily in my IRA and 401k.
Of course, Mr. Law thinks I’m 100% into stocks. Or that’s his recurring dream. I’m not. I have to keep saying this over and over like a parrot but it cannot get through his skull. I have enough government securities to last me several years without a job. I also have been buying thousands of $ worth of precious metals every year for the last ten years.
Gads! “Trump” instead of “Trumb.”
think, FED passing a coupon….. and you start getting the picture.
Gadzooks, what is that language the commenter uses? Some features of the orthography look Polish, but others I don’t recognize as Polish…is it Czech? Albanian? Bulgarian?
Lithuanian, the closest language to proto Indo-European still around.
From Wikipedia:
Anyone wishing to hear how Indo-Europeans spoke should come and listen to a Lithuanian peasant.
—Antoine Meillet
Lithuanian still retains many of the original features of the nominal morphology found in the common ancestors of the Indo-European languages, and has therefore been the focus of much study in the area of Indo-European linguistics. Studies in the field of comparative linguistics have shown it to be the most archaic among the living Indo-European languages.[1][2]
I especially like “[1][2]” — an archaic proto footnote!
come on, who doesn’t know that?
Banks have balance sheet issues. They are “hoarding” cash if they need it to fund loans or SIV assets they may have to take onto their balance sheets as well as funding their levered loans, buyout loans, etc. that they haven’t been able to sell.
If they’re hoarding cash, they can’t lend it into the interbank market, therefore normal or somewhat elevated demand for loanable funds is pushing LIBOR higher. Also, banks are afraid to lend to other banks in the interbank market because they fear the borrowers aren’t credit worthy.
“…Our traffic numbers are down but the market still looks like it’s OK - except for the bad press and that makes people more paranoid….”
Let’s send the whole press into jail and we will see endless economic prosperity and all people become wealthy.
Funny how the press is bad when prices are falling but good when prices are rising. Funny that people never realize that cheer leading press has a role in getting things out of hand.
Glad you said that Tweedle. I’ll never forget an asinine LA Times article in maybe mid-2004 arguing that buying was really no more expensive than renting because you have to subtract the annual appreciation from the annual cost (of “owning”). Ha ha, let’s see them use that logic now!
Housing prices rising = good.
Oil prices rising = bad.
“But we don’t have to fall down and play dead yet. I believe there are buyers for our homes. They just aren’t in town at the moment.”
I suggest we hold a Seance for the missing buyers, @ the Denny’s in Hesperia…
I’ll bring the Ouija board.
Heehee. How about this.
I believe there are buyers for our houses, they just havent been born yet.
“After two delays, real estate agent David Crisp’s lavish Seven Oaks mansion has been repossessed by the lender. …the 6,666-square-foot home
You just can’t make this stuff up, ladies and germs.
A building so Evil that even Satan passed on bidding for it……..
I think Satan himself “owned” that house and is about to lose it…
ROTFL.
Diablo Manor?
I can just see the ad now:
BLOOD RED CARPETS. 8 BEDROOM, NO BATH. VARIETY OF CEDAR CLOSETS, WITH CHAINS, PERFECTLY DESIGNED FOR ENTERTAINING!!! DINING ROOM INCLUDES MAN SIZE INDOOR BBQ. MUST SEE! HOT! HOT! HOT!
Got popcorn?
Neil
No mention of a basement in Beelzebub’s crib? To scary, eh?
I was thinking the basement should be stocked with Amontillado and fresh mortar.
Dang, we’ve got a literate bunch here.
In debitatus requiscat.
I noticed something cool today as I did data mining for my locale.
On 11/1/07, just over a month past, my median price for a 4+3 or bigger in 93552 Palmdale was logged as 369K. Here’s the breakdown as the month progressed.
11/1 369K
11/12 360K
11/19 355K
11/30 349K
A 20 thousand dollar haircut in just one month! That’s a 5.5% concession by sellers in 30 days. 20 more months of this and houses will be free! (32.2 cents on the dollar for you math Nazis)
My point is, sellers are becoming unglued from wishing prices. I do believe the rout may be on…
I’ll consider it a good deal when they start PAYING people to live in Palmdale, and then only MAYBE.
How original, a Palmdale joke!
People on welfare were moving from LA to buy houses in Palmdale after the last crash in the 1990s, so in effect people WERE being paid to live there!
Not sure if you guys have seen this, but Watts says 1) the downturn will end this month, and that 2) foreclosures will have minimal impact on the California market. Did you know that 8 billionaires live in Orange County? Guess we’ve overblown this whole bubble thing! Thanks Gary!
————————————————————————
I love it! Every month this clown destroys more and more of his once fleeting credibility. There may very well be a pick up in sales but at significatnly reduced prices!
Fannie is going to cut dividends by 30% and raise capital.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a_nWbr7A3XsQ&refer=home
“There may be more losses,” said David Dreman, who oversees $22 billion including Fannie Mae shares as chairman of Jersey City, New Jersey-based Dreman Value Management LLC. “Raising more capital will allow them to go out and start growing again” by leveraging their government-chartered status and continuing to expand their business of guaranteeing mortgage bonds.”
I’m not the sharpest tool in the shed, but isn’t Fannie losing its a$$ on mortgage bonds right now ? And isn’t the mortgage business really bad because there aren’t any homebuyers left that qualify and margin between originating and selling is razor thing ?
SO THEN WHY DO THEY WANT TO GO OUT AND “START GROWING AGAIN” ? To lose more money ? Its like the homebuilders that want to build more houses because inventory is rising and prices are falling ! Stupid, stupid, stupid !
“Raising more capital will allow them to go out and start growing again’’
Translation: ‘Raising more capital keeps us employed.’
Its not a growth move… its a survival attempt. Enough? I doubt it.
Got popcorn?
Neil
Forget Joshua Trees, you HBB types need to start using Christmas trees for the FBs in California, complete with lights and ornaments. People are talking about $500K like it’s monopoly money. !Aye carumba no me gusta! Hey at least if the California housing market goes down the toilet, you could get a house in Beverly Hills for $50K. Live right next to the celebrity types and make their life miserable bwahahaha…
Got Lube?
Can I live next door to Jessica Alba ?
To tell you the truth, Jessica Alba lived next door to me for about five years. Kind of strange huh?
So… that’s an awfully big telescope. You’re into astronomy?
Hey az-lender, do you need my address to send the check to? at this rate i will be needing the 10% down sooner than expected. 30k or so ought to do it. Let me know.
catspit1, you have neglected my first rule of lending. BIG DOWN PAYMENT to be made by YOU! … I don’t care what your FICO score is, or if your grandmother was left-handed and green-eyed, I don’t even care if you have a job. But a down payment you must get from someone else. And in this environment, it must be 30% or more. Hmm. I may be needing my own money pretty soon. The Morro Bay MLS is annoying, the wishing prices are much higher than the recent comps.
ORANGE COUNTY HOLDS TOXIC SIV - 1994 REDUX?? Is Bob Citron still alive??
http://bakersfieldbubble.blogspot.com
“They’re all highly rated assets”
With a standard disclaimer from the ratings agencies:
“The ratings dun mean whot you think they mean.”
Ratings…you keep using that word…
From Todays CNNMoney.com article on the bailout coming:
‘Ultimately a mortgage rate freeze would result in higher home prices, according to Peter Schiff, president of retail investment brokerage Euro Pacific Capital.
“The [investor] will say, ‘Wait a minute. The government can come back in a few years and alter contracts based on economic emergencies,’” he said.
Investors will want a higher return from their securities, and charge more for that added risk. “Because of government intervention, people will pay too much for their houses.”‘
-end quote
Remember when the Mexican government decided to take back property sold to Americans? Looks like the US government is doing the same thing to foreign investors. So the US government props up the economy with artifically low intrest rates and loose lending standards just so they can save face from the terrorist attacks. We should have had a recession back in 2001, now the pain will be twice as bad. Government intervention in markets causes nothing but pain unless you are one of the crooks.
It’s hopeless that Justice will prevail regarding the big fat real estate mania (2002-2007).I can’t help but think about how unfair moments in history have been to certain sectors of the population who didn’t deserve it . When you think about some of the most insane human behavior recorded in the history books ,the people could only see the insanity after the fact .
There has to be solid reasons why such a bizarre real estate bubble mania took place at this time in America and around the world .
Are the legal liability issues so alarming with this housing mess that the government wants to create a remedy before true liability is determined ? Don’t really expect anyone to be awake this late ,so good night and good luck .
This blog is read around the world. It’s not late everywhere on the globe. It’s morning in Europe.
It’s now morning in California and I stand corrected ,I forgot about the rest of the world .
If i had to guess, the ‘trend’ or ‘mania’ or whatever you wanna call it, started with some event(s) that changed the general attitude or altered the mass psychology of the public.
Since all types of people were affected, it would have to be an event that crossed all social, economic and political boundries.
9-11 is a good candidate. Explaining in words exactly how or why it may have done so is beyond me, but i can conceptualize it.
A substantial shock was effectively delivered.. there was unease and fear.. There was no panic to speak of, but something happened and everything changed. The world changed..
JoeyinCalif ……I have often wondered if 911 was more damaging to the American Psych than we know . Watching Katrina was also a event that would cause some shock and awe reactions .
But regarding 911 ,did the Americans go in to survival mode and become hording and greedy, seeking security by faulty investments .It’s seems like cult-like cheer-leading behavior starting happening on a mass level going into this decade .Did Americans start feeling the heat from globalism as well at the start of this decade ?
I have never seen people act this crazy about real estate ,and clearly people were brainwashed into believing that a greater fool would cash out their faulty RE investment that they committed fraud to get . Really strange behavior .
OT, but an interesting article comparing America just before the Great Depression and the situation now:
Boo Hoo! Deja Vu by Stephen Pizzo:
http://www.smirkingchimp.com/thread/11374
The article cites an interesting book (online) from that era, about pre-depression America:
Only Yesterday, and Informal History of the 1920’s, by Frederick Allen:
http://xroads.virginia.edu/%7EHYPER/ALLEN/Contents.html
Great article ,should be posted again today .