The Housing Bubble

The Las Vegas Sun reports from Nevada. “The upscale San Niccolo neighborhood, in one of the Las Vegas Valley’s newest master-planned communities, would seem a homeowner’s dream, its quiet streets lined with expansive homes starting at a half-million dollars. But anyone who drives past the broken entry gate will find a neighborhood pocked with ‘for sale’ signs.”

“They signify homes lost to, or threatened by, foreclosures. The remaining homeowners and renters say they feel isolated and vulnerable, worried not just about their own investments but for their very safety.”

“Of the 300 homes in San Niccolo, 60 are for sale and a third of those are in some state of foreclosure, according to the MLS. An additional 30 properties were sold in the past year, and many other homes are vacant.”

“Two summers ago the owner of a 3,100-square-foot home on Rock Cove Way wanted $690,000 for it. Three months later the house sold for $635,000. It’s now empty and owned by a bank, which will take $468,000 for it.”

“The real estate upheaval has opened the door for renters such as Katina Haynes, who pays $1,350 a month to rent a 2,600-square-foot home. She says the price is great but the neighborhood is strangely lonely.”

“‘I feel like when I moved in here I entered the Twilight Zone,’ Haynes says. ‘I keep thinking, ‘I know people live in these houses,’ but I never see anybody.’”

“Crime is a concern. Melyssa Cabrera has posted a notice on a bank of mailboxes warning that her purse was stolen from inside her garage and that someone had broken into her husband’s car in the driveway.”

“Cabrera says she and her husband bought their home two years ago for $435,000 and have added $70,000 in upgrades. Now, a job transfer is leading them away. They’re asking $420,000 for their half-million-dollar home.”

“Karen Lewis and her husband bought a home on Arcata Point Avenue a year ago. She says they paid too much, considering what’s happened to the area. Lewis, who moved from Oceanside, Calif., is particularly bothered that investors haven’t found buyers. As a result, she says, young adults who presumably can’t afford to own a home here…are moving in as renters.”

“They invite over friends who force their cars through the gate, which now is repeatedly broken.”

“Among its various dubious distinctions, Nevada’s ironclad hold as the foreclosure capital of the nation seems secure.”

“In June the state had one foreclosure filing for every 175 households, to lead the nation for the sixth consecutive month, according to RealtyTrac. That’s almost triple the foreclosure rate in June 2006 and well ahead of second-place California, which had one filing for every 315 households.”

“Michael Krein, president of Nevada Real Estate Services, which works with banks in foreclosure proceedings, said he is handling 700 foreclosed properties and expects that number to increase when loan payments are adjusted upward later this year or in early 2008.”

“Homeowners who bought their homes with an adjustable rate mortgage have seen their payments increase 50 percent in some cases and others have seen their payments more than double, Krein said.”

“About 75 percent of the homes Krein has dealt with were purchased by speculators who hoped to benefit by reselling homes in an appreciating marketplace but timed it late and have walked away from their equity.”

“‘A lot of people bit off more than they could chew,’ said Devin Reiss, president of the Greater Las Vegas Association of Realtors.”

“Local housing analyst Steve Bottfeld said he’s seen one example in which one investor is responsible for 40 foreclosures.”

“Local housing analyst Larry Murphy said 11 percent of the 25,000 homes listed on the MLS are short sales.”

“Scott Bice, commissioner of the Nevada Mortgage Lending Division…said not everyone can be helped. ‘If you have a $3,000 mortgage payment and you can only afford $1,500, there is not much help that can be provided to that person,’ Bice said.”

The Record Courier from Nevada. “Three vacant properties will be auctioned for back taxes on Aug. 6, something that almost never happens in Douglas County, said Clerk-Treasurer Barbara Griffin.”

“‘This is very unusual,’ she said. ‘In the last 13-15 years, we’ve had only one other property auctioned.’”

“Two other homes would have been auctioned, but the taxes were paid on the last day, Griffin said. She didn’t know the reasons people failed to pay their taxes on these properties, but feels the economic slump may have played a role.”

“When compared to last year’s figures, existing home sales have dropped 33 percent in Douglas County for the period ending in June. The $400,000 median sales price is down 7 percent and the sales-dollar volume is down 44 percent, according the most recent report from Sierra Nevada Realtors Association.”

“According to RealtyTrac, Gardnerville has 55 single-family home foreclosures and Topaz Ranch Estates has one.”

“Michelle Godde, spokeswoman for Syncon Homes, said everyone is taking a hit in this market and new home sales have suffered. Despite the slump, Syncon is moving forward with plans for a large-scale project in north Douglas County’s Clear Creek area, Godde said.”

“‘There are so many variables, like weather and engineering issues,’ she said. ‘The safest thing I could say is, it’s a work in progress.’”

“Mick Cavnor of Beverly Realty in Gardnerville said the real estate market is caught between buyers waiting for the price to come down and owners who think their home is still worth what it was a couple of years ago.”

“‘There’s a stalemate,’ he said. ‘But buyers need to realize prices could start up and if they wait, they could miss the boat.’”

“There are about 88 homes for sale in the Gardnerville Ranchos for under $300,000, but two years ago realtors would be lucky to find seven homes in that range. Buyers had to make their decision before the property was sold to someone else, Cavnar said.”

“‘About every three weeks we hear something in the media about the sagging market, but the sub-prime market has blown the statistics out of proportion. Interest rates are still good,’ he said. ‘It’s still a buyers’ market and it’s to a buyers’ advantage to jump on it.’”

“One developer Cavnar knows said he expects the slump to last another six to eight months, while another thinks it will last three to four years, he said.”

“The cost of renting is between $300 -$400 under the cost to purchase a home, but as the demand for rentals grows and prices increase more people will consider buying, he said.”

“‘I think this winter will be slow, but if buyers are educated the housing market will pick up,’ he said.”

The Chicago Tribune reports from Illinois. “Lower- and more moderate-income areas continue to be hit by foreclosures, but pricier communities in Cook and Lake Counties are hardly immune, according to an analysis done for the Tribune. Record Information Services looked at foreclosures involving mortgages of $350,000 and higher and found 584 in those two counties in the first five months of 2007, more than double the 265 recorded in the same period last year and 117 in 2005.”

“Weed complaints are up in Highland Park, and so are foreclosures. ‘A good amount’ of the gripes, said assistant city manager Patrick Brennan, ‘is attributable to the increase in the number of foreclosures. Many times, when a property is in foreclosure, it’s abandoned.’”

“In many cases, the owners had the mortgage for less than a year, said Patty Maier, Record Information’s data management director.”

“Highland Park, where the median family income, according to city estimates, is $117,000, had 15 foreclosures involving mortgages of at least $350,000 in the first five months of this year. That’s on track to be triple the number the suburb recorded in all of 2005.”

“Mayor Michael Belsky said some residents are insulated from economic upheaval. ‘You do have some wealth, and you also have a lot of professionals that even in bad economic times are going to do OK because they’re bankruptcy lawyers or something like that.’”

“Hired to sell a foreclosed property on Cavell Avenue, Tom Koikas believes it’s simple: Too many people bought homes they couldn’t afford.”

“Consider 860 Pleasant Ave. in Highland Park. ‘No one ever lived there,’ said neighbor Holly Moore, after the 11/2-story bungalow was renovated and then unsuccessfully listed for about $600,000. ‘It has been a nightmare,’ added Jim Graue, whose wife regularly calls Highland Park officials about the tall grass and weeds; yards are in violation when weeds or grass exceed 8 inches in height.”

The Beacon News from Illinois. “Developers knocked on Hank Cryder’s door in Minooka for years before he finally let one in. Amidst a red-hot housing market, subdivisions were creeping toward his nearly 200-year-old farm at Ridge and Caton Farm roads, and Cryder was ready to pack.”

“He signed an option clearing the way for a developer to purchase the 1,800-acre farm. Then the housing market cooled. ‘In the best-case scenario, we would have been gone already,’ Cryder said. ‘But because of the slowdown…here we are 18 months later.’”

“In reaction to an estimated 30 percent drop in construction and sale of Chicago-area homes, developers are setting their sights on fewer Kendall County farms.” “For every three farms turned into subdivisions last year, only one has been developed this year, according to an estimate by Kendall County Farm Service Agency Executive Director Les Maierhofer.”

“‘In previous years, (farms) would be sold and immediately built upon,’ he said.”

The Winona Daily News from Minnesota. “Federal investigators are probing a possible rash of mortgage fraud in the Twin Cities in response to reports of a large number of unusual real estate transactions in north Minneapolis and elsewhere.”

“‘The FBI has identified Minnesota as an area significantly affected by mortgage fraud,’ U.S. Attorney Rachel Paulose said.”

“Suspicions about illegal ‘property flipping’ were aroused by sales that attracted the attention of North Side neighborhood leaders. Some of those properties are now in foreclosure, according to Minneapolis City Council President Barbara Johnson, leaving the city with unpaid water bills and delinquent property taxes.”

“‘What they do is they buy the property at a normal price from a willing seller and they flip it within their own limited liability company and they do it at an inflated price,’ Johnson said.”

“The company often held onto properties for several months, according to property records. But according to Johnson, many of the properties lacked any evidence of improvements that would justify the gain in prices.”

The Twin Cities Daily Planet from Minnesota. “The Columbia Heights City Council revokes rental licenses at every meeting. Fire Chief Gary Gorman, who heads the city’s housing inspections, said there are generally two reasons.”

“The first is simple negligence: the landlord failed to make a repair or turn in money and paperwork on time. The second is foreclosure, a growing problem that has many residents, city, and state officials concerned.”

“‘Rental properties have become a real problem,’ Gorman added. ‘About five or six years ago, when the real estate market was so good, houses were valued very high. A lot of our old time owners said, ‘I’m selling. I’m out of here.’ What we got in, then, was people buying up investment properties. Then the rental market got terrible.’”

“‘Landlords couldn’t even get close to what they needed in rent to pay the mortgages; they’d bought these houses at such inflated prices. What ended up happening was that people were just walking away. They couldn’t sell them,’ Gorman said.”

“‘We cut a lot of lawns; the majority of them are vacant buildings,’ Gorman said. ‘Foreclosures are a big problem. The Anoka County Union [newspaper] has long lists of foreclosures. First ring suburbs are getting nailed worse than any others right now.’”

“Gorman said dealing with the banks can be frustrating. ‘Sometimes they ship it out to a contract company. I sit on the phone all the time to banks in California and Florida. They have no clue about a property in Columbia Heights, even when we’ve tracked it down to them. We can go a good six months without finding somebody to work with…How do you take a rental license away from a phantom bank in California?’”

The Grand Rapids Press from Michigan. “In the high times of home construction, Sable Developing in Rockford would carry between 45 and 50 homes in their inventory.”

“‘Right now, we have the absolute bare minimum for our company,’ VP John Bitely said. ‘We probably have 15. We’re struggling a little bit like everybody else.’”

“For some, struggling is an understatement. Single-family home starts through the first half of the year are down a combined 36 percent in Kent and Ottawa counties from last year, and down 56 percent from two years ago, according to Ada-based Builder Track.”

“‘Very few of our members are doing any speculative housing at all,’ said Judy Barnes, chief executive of the Home & Building Association of Greater Grand Rapids.”

“Rick Gootjes, of Deppe Homes in Caledonia, said starts for his company are not what they used to be. ‘A lot of guys are trying to pick up remodel jobs and jobs that, in years past, we wouldn’t have done because they were too small,’ he said. ‘There is not a whole lot of confidence out there.’”

“Gootjes said they recently sold a house entered in this year’s Spring Parade of Homes, but the home also was in last year’s Fall Parade. ‘We sat on it for eight or nine months,’ he said.”

From Crains Detroit in Michigan. “The housing situation is unlikely to get better before yearend. ‘To call the housing market a lost cause might be extreme, but there’s just a huge overhang of unsold inventory that is depressing both prices and new construction. It’s going to take a year or longer to work through the inventory,’ said Carl Steidtmann, chief economist for Deloitte & Touche USA L.L.P.”

“New federal guidelines were issued this month that reduce credit availability in the subprime market. ‘They flat-out can’t get a loan, now. They are out of the market,’ said Bob Walters, chief economist at Livonia-based Quicken Loans/Rock Financial.”

“David Meahney believes he has found a way to earn a profit despite a soft housing market, and the Plainfield Township Board is giving him a chance to test his hunch.”

“Board members unanimously agreed to let Meahney construct 61 condominiums instead of the 22 single-family houses previously approved for the southwest corner of Five Mile Road NE and Grand River Avenue.”

“Meahney said market demand for 20,000-square-foot houses has suffered a sustained nosedive.”

“He said condominiums averaging 1,200 to 1,500 square feet should be more attractive to baby boomers who don’t want upkeep responsibilities of a larger home.”

The Boston Globe reports from Massachusetts. “Massachusetts single-family homes and condominium sales continued to fall in June, a month that is typically one of the busiest of the year for closing real estate transactions, according to industry reports out today. ‘June was a tough month for housing sales - one of the toughest this year,’ said Timothy Warren Jr., CEO of the Warren Group.”

“The Warren Group said that Massachusetts single-family home sales fell 8.3 percent in June, the second biggest drop this year; the median price for a single-family was $334,000, down 4.6 percent from $350,000 in June 2006.”

“According to the Massachusetts Association of Realtors, the number of Bay State single-family homes that sold in June dropped 6 percent to 4,959 when compared with June 2006, and on year-to-year basis, the median price for a single-family home in Massachusetts fell 1.6 percent, from $370,000 in June 2006 to $364,000 in June 2007.”

The Republican from Massachusetts. “The region’s real estate slump seems all the more real with last week’s report from registers of deeds in the three Pioneer Valley counties. All three showed a sharp rise in housing foreclosures in fiscal 2007.”

“Not since the recession of the early 1990s have the officials seen such a spike. Marianne L. Donohue, register of the Hampshire County registry, called the numbers ’staggering.’”

“In Hampden County, the number of foreclosures almost doubled from 278 in fiscal 2006 to 529 in fiscal 2007. In Franklin County, foreclosures more than doubled, rising a whopping 130.7 percent from 26 in 2006 to 60 in fiscal 2007. In Hampshire County, foreclosures rose by 78.8 percent to 59.”

“The number of attachments filed by creditors on the property of people who owe them money is also up in each county. And Donald E. Ashe, Hampden County register of deeds, said the rising attachments are ‘a bad sign for the economy.’”

The Associated Press. “Home sales in the Philadelphia area fell by 9.5 percent in the first half of the year, as the region remained mired in a housing slump that started last fall, according to a report.”

“The southern New Jersey suburbs showed the biggest decline, down 13 percent, while northern Delaware was down 11.7 percent and southeastern Pennsylvania fell by 7.5 percent, according to all multiple listing service data of existing single-family homes and condominiums compiled by Prudential Fox and Roach in Devon.”

“‘We were hopeful it would start coming back in the first half of this year. It has not,’ said Steve Storti, marketing director at Prudential, the nation’s fifth largest real estate brokerage.”

The Tribune Review from Pennsylvania. “It took about six months for David and Teresa Cunkelman to find a new house, but the couple still can’t find a buyer for their old home in Murrysville.”

“The Cunkelmans aren’t alone. The Pittsburgh housing market is showing signs of slowing down. Figures from RealStats show a 13.4 percent decline in home sales during June, compared with a year ago.”

“About 15 potential buyers have toured the Cunkelmans’ former home on Impala Drive since it went on the market in February. The house is priced at $215,000.”

“‘Until now, we have not had a serious buyer,’ Teresa Cunkelman said.”

The New Haven Register from Connecticut. “Originally hoping to spend no more than $1,200 or $1,300 a month on mortgage payments, she ended up taking out two adjustable rate mortgages, or ARMs, one covering 80 percent of her $199,000 loan and another covering the remaining 20 percent, resulting in combined monthly payments of about $1,600. She financed the entire mortgage, with no down payment.”

“She was driven by the American dream of owning a home, she said. Now, 16 months later, her mortgage payment has ballooned to more than $2,000 a month, forcing her to work at least 80 hours a week, split between two jobs.”

“And the threat of foreclosure looms. ‘It does worry me,’ (Ms.)Wright said.”

“Making matters worse, the housing market has slowed in recent months from the high level of activity seen in the past couple of years, when sales and prices skyrocketed. That means, in many cases, homes are worth less than when buyers purchased them. Or, the worst case scenario, the house is worth less than the mortgage.”

“In the second quarter of this year, for example, the median sales price of Greater New Haven homes fell 1.3 percent and the number of homes sold dropped 8.2 percent, compared with a year ago, according to H. Pearce Real Estate Co. in North Haven.”

“In Connecticut, 2,386 homes were in foreclosure in June, up 2.5 percent from May and up 124 percent from a year ago, according to RealtyTrac.”

“‘When I sat down at the table at the closing, no one told me my mortgage was going to be $2,000,’ Wright said. ‘They claim it’s just because of things costing more. I’m house-poor now. I work two jobs. It’s really kind of a scary experience. This is not the American dream like everyone said it is — not at this rate, anyway.’”

“In New Haven alone, 405 homes are now in foreclosure, according to Empower New Haven Inc. ‘The interest rates on the ARMs have kicked in,’ said Peter L. Ressler, partner at Goob, Ressler & Mulqueen PC in New Haven, which specializes in bankruptcy cases. He has seen ‘a tremendous increase’ in bankruptcy filings and attributes 90 percent of them to mortgage defaults.”

“‘(People) get these notices of a change in their monthly mortgage application and it just throws them into a collapse,’ Ressler said. ‘They just didn’t anticipate that their payments were going to go up so drastically. It’s a combination of factors that creates an insurmountable situation.’”

“There is a total of $10 billion to $12 billion in outstanding subprime loans in Connecticut, said Howard Pitkin, commissioner of the state banking department. ‘That involves thousands of families in Connecticut,’ he said.”

“Some in the mortgage industry defend ARMs and subprime loans, saying they work well for the right borrower and are not the root of the foreclosure problem.”

“‘There’s a lot of misconception,” said Mike Peracone, owner of Branford Financial. ‘I have plenty of people I’ve put in these mortgages. If used correctly, people are not stuck into them. It could work out great if they pay their bills.’”

“Andy Ross, owner of a Hamden-based mortgage brokerage company, generates about half of his firm’s business from subprime lending and said most borrowers understand what they are getting into when they sign a subprime loan or ARM.”

“‘A very, very high percentage of people understand what they are doing,’ he said, but some simply take on more debt than they should because they want a certain home. ‘They are just blinded because they want what they want. The real estate market has outpaced what people can afford, but I really don’t believe all of this is strictly the result of adjustable rates going up.’”

“A New Haven resident, who declined to be identified, was surprised recently by difficulties he’s had securing a fixed-rate mortgage on a home he wants to buy in Clinton, even though he’s had another fixed-rate mortgage with the same lender for nearly five years and has always been in good standing with the loan.”

“He was told by the lender that he would be approved for a the new mortgage but, soon after, the lender, citing the company’s increased concern over foreclosure rates in general, said it needed to see additional financial documentation before going through with the loan.”

“‘We were told everything we needed was in place,’ he said. ‘We’ve never been late on a payment, we’ve always paid extra. (Now) the same exact company is saying, ‘We need more.’ We’re in shock. It’s a life-changing conversation every time I talk to the mortgage company.’”

The Post & Courier reports from South Carolina. “Weeks before Dorothy O’Mara put her Mount Pleasant condominium up for sale, the unit next door found a buyer in a mere four days. More than a year later, O’Mara’s unit is still on the market. In the Montclair condo and townhouse development…one in every six properties is up for sale. While her two-bedroom, 2 1/2-bathroom end unit has one of the lowest price tags at $175,000, it has been a struggle to attract buyers.”

“‘It’s been kind of an impossible situation,’ said O’Mara.”

“The local market is full of units that are up for sale, nearly 2,000 in all, compared with less than 500 in a given month just two years ago, according to figures from the Charleston Trident Association of Realtors.”

“The upshot is that some condo sellers are cutting prices or offering incentives to lure buyers. Also, several new projects have been delayed, and plans to convert at least one apartment complex into condos have been scrapped.”

“In Mount Pleasant, conversions became a popular option because of a town regulation that limits the number of building permits. Developers continued to build new projects alongside thousands of single-family homes.”

“‘This was the 100-year flood,’ said Fudgy Brabham, broker-in-charge of Harbourtowne Real Estate.”

“Sellers such as O’Mara are shocked at how difficult it has been to find buyers. ‘Some of the neighbors have been forced into foreclosure, and it’s just been very sad,’ she said.”

The News Press from Florida. “Occupancy rates in Fort Myers’ big apartment complexes plunged 10.9 percent in the second quarter, according to RealFacts. Rental complexes with 100 or more units were at 87.6 percent occupancy, down 10.9 percent from a year earlier.”

“Jim Garinger, a real estate agent who follows the multifamily market, said occupancy rates in the big complexes dropped because of competition from other sources, including the conversion of apartments to condominiums.”

“‘The amount of condo conversions that’s happened in the last two years has had a big impact,’ he said. ‘Those units were pulled off initially as condominiums but now we see them coming back on and being rented.’”

“‘That in combination with the regular condo products that were sold pre-construction and they were either sold to someone who’s renting them out or the developer decided to rent them,’ he said.”

The Herald Tribune. “Stacked-up listings and double-digit price declines, phenomena that have plagued the Southwest Florida residential real estate since mid-2005, have skewed the rules for getting divorced.”

“It is not hard to find divorce attorneys who will complain about the effect that the housing blues are having on business. ‘I had another one today with the same problem,’ said Lisa Kleinberg, a family attorney in Sarasota. ‘House on Siesta. And it has gone down from being worth about $1.2 million to being $900,000. They can’t get it sold.’”

“‘We used to rely on appraisals, but their value is questionable,” he said. “Regardless of what the appraisal is, the value of a property is only what someone is willing to pay for it. There are fewer buyers now,’ said Richard Perlman, a Longboat Key Realtor.”

From NBC 2 in Florida. “Foreclosures in Lee County continue to soar and realtors say the housing boom of the past few years is to blame. In June alone, Lee County reports show that there were 968 foreclosures. That’s up dramatically from numbers in June of 2004 when there were only 156 foreclosed homes.”

“As home prices drop, foreclosures are increasing and with last months numbers equaling more than half of 2004’s entire total, local investors try to remain hopeful.”

“‘There is now way you can have 10 different houses and if you paid $300,000-$400,000 for them 2 years ago, that that house or condo is going to sell,’ said realtor Fern Twenhafel.”

“‘It’s really sad, but there is not much we can do about it,’ said Twenhafel who added that she has a condo like that now, as well as other properties that she need to sell soon.”

The Times Union from Florida. “Jacksonville’s foreclosure epidemic is widespread among all neighborhoods and income groups. But in one community on the Northside, a battleground of owners, investors, and lenders is strewn with the casualties of a mortgage industry in turmoil.”

“In Lake Forest, the concentration is much greater, with some neighborhood blocks plagued with clusters of homes in default.”

“Realtor Peggie Wattron said she has about 90 foreclosure listings. She said she’s handled all types of crises in foreclosed homes, from homeowners who won’t leave until a policeman and cleanup crew literally kick them, and their belongings, out to the curb, to urban campers that break in and move into foreclosed homes.”

“Wattron says…that she’s hardened to sob stories given by former owners who claim not to have seen an eviction coming. ‘I’ve heard every story in the world. I literally go out to the house and put a note on the door, and then some act like they didn’t think it could happen. Most of the time I never get a message and no phone calls,’ she said.”

“‘A lot of people, who tend to have low incomes, have had bad experiences and are used to being told ‘no’ when it comes time to take out a mortgage. The ploy with some mortgage brokers is that they’ll say ‘yes’ to you, but they don’t give the details of what that ‘yes’ really means,’ said (mortgage broker) Jeff Lazerson.”

“Sometimes an event is so unusual it demands our attention. Levitt and Sons did just this, with a developer closeout auction of the town homes in Fort Myers…held on June 7.”

“Expectations of many, was that between the hope to buy below market, the expected high number of bidders and the excitement of an auction, final prices would end up being close to the original developer prices … but just the opposite happened! In fact, only 37 of the 53 offered actually sold at the auction, plus an additional five directly after. Those that did sell sold well below original developer prices.”

“The absolute highest price paid for the entire evening was the very first property. The hammer price was $225,000 (plus 10 percent). The next hammer price was $210,000, then $195,000, $185,000 and so on all the way down to $140,000. So went the evening as each new group of town homes opened for bidding, opened high then drifted down as successful bidders were removed from the pool of potential buyers.”

“This audience wasn’t going to get sucked into ‘auction fever.’ In fact, when the reserves were too high, no one bid, making for an unusual silence. I had the opinion…that Levitt and Sons management felt like ‘deer in headlights’ when this happened.”

“My hope is that as land prices, labor costs and some materials continue to correct, builders will be able to offer quality properties like those at San Simeon at these affordable auction prices. When they do, buyers will appear.”

“In response to a recent column about home auctions, Realtor and auctioneer Marsha Wolak wrote in to say she successfully closed 18 properties in an auction last spring and is preparing another ‘mega-auction’ for August.”

“‘One (home) in particular had been on the market for a year and a half with no offers,’ she wrote. ‘I commend the brokers, agents, sellers, buyers and media for recognizing the need for auctions in this marketplace.’”

“‘It is not fiction, it is a fact, that properties are selling at auction. I only wish that all auction companies operated ethically and morally when it comes to ‘absolute’ sales, shills and rigged bidding as well as excessive fees and commissions,’ Wolak said.”

“She said buyers are being taken advantage of and believe the home really is selling ‘absolute’ when it is not.”

“Wolak said she attended a multi-property auction recently in Estero, and even in the terms and conditions it stated: ‘XYZ Company may act to protect the seller’s reserve, as an agent of the seller, by bidding on behalf of the seller. The auctioneer has the right to reject or raise any bid which, in his opinion, is not commensurate with the value of the property being offered.’”

“Similar language exists in some auction listing agreements and does not appear in their terms and conditions, and virtually turns an auction ‘into a joke,’ she said.”

The Sun Sentinel from Florida. “In half of Broward’s cities, more people are leaving than moving in, census figures show. ‘We left because we tried for almost two years to find a house we could afford to buy, but we couldn’t,’ said Diana Fernandez, who moved from Pembroke Pines to North Carolina with her husband and two daughters in February.”

“They traded a rented townhouse for a new $200,000, four-bedroom home on a large lot about an hour from Charlotte.”

“Another indicator of a downturn in population is declining school enrollments. Broward’s public school population has dropped two years in a row, with about 10,000 fewer students enrolled during that time. District projections show enrollment continuing to drop until 2012.”

“The gap between what people earn and home prices, despite the real estate market’s downturn, is still too wide for some to afford a home, financial experts say. Generally, the purchase price of a house should not exceed three times the annual salary of the buyer, they say.”

“The median price of a single-family home in Broward is about $370,000, almost seven times higher than the median household income in Broward of $53,100, according to the U.S. Department of Housing and Urban Development.”

“Roy and Ruth Smith, of Coral Springs, have their home of eight years on the market for about $330,000. They are hoping to join relatives in Loganville, Ga., a suburb of Atlanta. ‘If I get my price here, I can buy a house up in Georgia and not have a mortgage payment,’ said Roy Smith, who is retired.”

“Fourteen other Broward cities saw declines ranging from two people in Southwest Ranches to 241 in Lauderhill. The others were: Cooper City, Dania Beach, Deerfield Beach, Hollywood, Lauderdale-by-the-Sea, Margate, North Lauderdale, Oakland Park, Plantation, Sea Ranch Lakes, Weston and West Park.”

“‘Those young families that used to come in larger numbers to South Florida now are saying, ‘Where am I going to be able to afford to live?’ said real estate analyst Brad Hunter of Metrostudy.”

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