The Housing Bubble

The North County Times reports from California. “Despite relatively high February home sales and real estate agent reports about a swarm of buyer activity, North County’s housing market hit a new low in March. North County home sales posted the biggest year-over-year drop since the start of the housing recession, according to HomeDex. The area’s median sales price continued to take a beating and also showed the largest annual decline yet. In March, it dropped below $500,000 for the first time since 2003.”

“Sales tumbled 37 percent from a year ago, to 484 sales, the largest year-over-decline since sales fell off from a 2005 peak. The perennial bump in March home sales from February for North County was lower than ever recorded for San Diego County.”

“Foreclosures leaped in March, with new notices of default in San Diego County more than doubling from a year ago, to 3,116, according ForeclosureRadar.com. Last month’s inventory is still almost double that of a year ago.”

“The weak sales data in homes and continually steep decline in median price will not last for long despite a potential increase in foreclosures, said one real estate agent.”

“‘I think we’ll see it (better sales) because the pricing structure is going to force the issue,’ said Chuck Smiar, a real estate agent in Escondido. ‘There’s a lot of buyers sitting on the fence waiting for the bottom. And I think if they don’t jump in soon, they’re going to be sorry.’”

“Other real estate agents and brokers said that only certain markets have hit their lowest price points. Meanwhile, sellers in stronger markets are trying to refrain from posting their property until the market recovers. That leaves the potential for a flood of listings, they say.”

“‘We haven’t hit the terrified phase yet,’ said Shawn Harris, a mortgage broker in Oceanside. ‘The sellers are going through the seven stages of denial. … Eventually, they will get to the stage where it’s, ‘Holy crap, I’m not going to be able to make this mortgage payment anymore.’”

The Orange County Register. “Six out of every 10 Orange County homeowners who bought a home in 2006 are ‘upside down’ on their mortgages, meaning that they owe more for their home than it was worth in the fourth quarter of 2007, according to Zillow.com.”

“Nearly four in 10 who bought in 2007 were upside down by year’s end.”

“‘Eighty to 90 percent of our clients are upside down,” said Connie Der Torossian, VP of marketing and outreach at the Fair Housing Counsel of Orange County. ‘Very few have equity, so most owe more than their house is valued at now.’”

“Orange County’s median home price has fallen 19 percent since the peak price set in June, according to DataQuick. The Standard & Poor’s Case-Shiller Index, put the Los Angeles-Orange County peak at September 2006, showing that values fell 18 percent since then.”

“Stan Humphries, Zillow’s vice president of data and analytics, noted that Orange County homeowners still are better off than others in more strapped parts of California.”

“For example, 77 percent of Stockton’s 2007 homebuyers were upside down by year’s end; 73 percent of them were upside down in Merced, Humphries said. In the Riverside-San Bernardino area, 60 percent were upside down, compared to 38 percent of Orange County’s 2007 homebuyers.”

“Mike Cocos, general manager of ERA North Orange County, noted that 34 percent of the homes for sale in the local MLS are either foreclosed properties or ’short sales.’ He said he took a listing at the start of April from a homeowner who owes $80,000 more than the home’s worth in today’s market.”

“Clemente Mojica, the housing services home ownership director, added that borrowers who used stated-income loans to buy their homes now can’t qualify to refinance before their monthly payments go up.”

“First, they now must prove they have sufficient income, something many can’t do, he said. And even if they could qualify, their lowered home value makes it impossible to get a new loan.”

“‘Who’s going to refinance them when they have negative equity, when they’re upside down?’ Mojica asked.”

“Sherrie Le Van has worked as a Realtor in Ladera Ranch for seven years. She says the market shifted in late 2005 and early 2006. Before then, she estimates that agents sold an average of two to three homes a month. Now, it’s down to one, if that, she says. LeVan says a lot of agents have had to supplement their income with other work.”

“‘Everyone’s standard of living has been somewhat affected,’ she said.”

“Before the housing market cooled, LeVan reached out to other Realtors who lived and worked in Ladera Ranch. Their association became known as the Ladera Ranch Resident Realtors Business Partners, and included 12 members. When the market took a nosedive, LeVan said, ‘A whole lot of people dropped away.’”

“Realtor Steve Pattinson now heads the group. He says that over a third of the approximately 331 listings in Ladera Ranch are either bank-owned properties or short sales. ‘People can’t compete with the short sale. Their prices are way up,’ said Pattinson.”

“LeVan says she doesn’t ask former members of the group what they’re up to these days. ‘It’s just such a personal thing,’ she said.”

The LA Times. “Grant Niman landed his dream home in Hermosa Beach after a careful six-month search. The sale price came in just under $1.4 million. Comparable houses near Niman’s pick were selling for as much as $200,000 higher in December.”

“In February, the average of median sale prices in 18 beachside ZIP Codes, including parts of Santa Monica, Manhattan Beach and Long Beach, was $1.08 million, down nearly 8.9% from August and 10.2% from February 2007, according to DataQuick.”

“Some of the biggest seaside bargains, real estate agents said, were in Huntington Beach’s three coastal ZIP Codes. Median prices peaked at $785,000 to $1.2 million in 2007, but the range had declined to $635,000 to $827,000 in February.”

“Newspaper ads for beach-area houses are beginning to echo those for properties farther inland, with headlines such as ‘$$ PRICE REDUCTION!!’ and ‘BEACH HOME STEAL!’”

“‘A year ago, bidding wars were the norm,’ said Denise X. Lavell, who runs Beach Girl Realty. ‘You’d have a buyer out there the day the property was listed. Now, people are taking a month or two months to decide.’”

“Javier and Marianne Cano recently spent nearly $1.9 million for a two-story, five-bedroom Spanish-style house less than a quarter of a mile from the ocean in Redondo Beach. Six months earlier, the Canos would have had to pay about $2 million to $2.1 million, based on comparable home sales at the time.”

“‘We got a little bit off the asking price, but we thought it was priced pretty reasonably in the first place,’ said Javier Cano.”

“‘The individuals who had the income and wealth to own in the beach areas have not seen any significant decline in their situations,’ said Michael Carney, director of the Real Estate Research Council of Southern California at Cal Poly Pomona. ‘If the economy really starts to tank, you might find more of an impact in those areas.’”

The Press Enterprise. “It was only 20 seconds into John Husing’s annual forecast on Inland Southern California’s economy when he said the word few people in the audience wanted to hear.”

“And, the region’s leading economist and a panel of housing and finance experts told a gathering of business leaders Tuesday, there are factors that, if they come to pass, could mean people will say ‘recession’ more than a few times this year.”

“‘For all intents and purposes, we have stopped growing,’ Husing said in his annual economic forecast.”

“In the 12 months from April 2005 to 2006, the two-county area gained 44,100 jobs. But from 2006 into 2007, the gain was a paltry 592 jobs, roughly the number of workers on one shift at a single large distribution center.”

“Currently, the job losses are across the board, and most of them can be traced to the slowdown in the housing market. ‘This has decimated a huge industry,’ said Steve Johnson, director of Metrostudy. ‘It’s going to be very hard to put the machine that produced this housing market back together again, and we will have future pain ahead in the resale market.’”

“Husing said the only people buying homes these days are people shopping for bargains at foreclosure prices. ‘The regular folks are on strike. They’re not buying houses,’ Husing said. ‘There’s no one out there but bottom-feeders.’”

“The current decline in median prices from the late-2006 peaks in the Inland region is something that will lead to a bit of good news, Husing said. It means that the middle-income buyer, who was virtually priced out of the market two years ago, may be able to afford a place as prices continue to decline.”

“Although, Johnson added, the days of the convenience-store clerk putting a $10,000 monthly income down on his mortgage application are probably over.”

“‘The change in the market psychology is tough,’ Husing said. ‘People will be suspicious about prices for a long time.’”

The Modesto Bee. “Property taxes are due Thursday, but Stanislaus County auditors predict a startling spike in unpaid taxes. If trends hold, about 8 percent of what’s owed won’t be paid. That’s about triple what is normal.”

“‘Eight percent is ridiculously high,’ said Todd Filgas, the county’s property tax accountant. ‘We’re having quite the excitement over here about it.’”

“More than 170,000 landowners were billed $484.3 million for their 2007-08 property taxes. Half of that money was supposed to be paid Dec. 10 and the second half is supposed to be mailed by Thursday.”

“But many property owners missed that first payment, and there’s fear that many more will ignore Thursday’s due date. Last year, 6.42 percent of Stanislaus County property taxes weren’t paid, and that was bad enough.”

“‘Since I came here in the late ’70s, it had never been that high,’ said Ray Rassmusen, who manages the auditor’s property tax division.”

“Rassmusen said the county doesn’t have easy-to-access delinquency statistics going back to the Great Depression, but auditor records show the average delinquency rate has been less than 3 percent the past 15 years.”

“Eventually, those taxes will be collected, said Stanislaus County Tax Collector Gordon Ford. Property owners who don’t pay within five years will have their land sold at tax foreclosure auctions. Last year, three Stanislaus County properties met that fate.”

“Mortgage payment defaults, however, triggered more than 2,500 foreclosures in Stanislaus county last year. ‘Banks that foreclose will make their property tax payments. It’s just a matter of when,’ Ford said.”

“Gov. Schwarzenegger spoke at a private meeting at Modesto Centre Plaza with area city council members and officials from Stanislaus, San Joaquin and Merced counties. He said cuts alone won’t solve the $16 billion deficit projected for the 2008-09 state budget, but he ruled out taxes as a solution.”

“Schwarzenegger (said) that he’s optimistic that the current downturn in housing will abate in a year. He was less rosy on the prospects for all distressed homeowners finding their way out of foreclosure.”

“‘It hits a lot of people who took a tremendous risk and knew it,’ Schwarzenegger said, describing the subprime loans that are now failing quickly, particularly in the valley. ‘Borrowers and lenders made mistakes.’”

The Sacramento Bee. “Several Sacramento-area cities stung by the real estate downturn are considering deferring developer fees as a way to stimulate the local economy.”

“‘It’s not just to see if we can get sticks and bricks up,’ Folsom Vice Mayor Steve Miklos said Monday. ‘It’s to get people back to work.’”

“A fee deferral proposal for the city of Sacramento is in its infancy, said Wendy Klock-Johnson, spokeswoman for the city’s Development Services Department. Efforts by the city attorney, treasurer and Development Services Department staff should translate into a proposal for the City Council later this year, she said.”

“Miklos says Folsom’s plan is a local version of the federal economic stimulus plan.”

“‘If we can defer some of the fees that don’t have an impact to the city until folks move in,’ Miklos said, ‘why can’t we build sooner rather than later? The benefit to the city is more properties on the tax rolls. The benefit to the builders is getting these people back to work.’”

The San Mateo County Times. “Home sales continued their downward spiral in San Mateo County in March, while home prices also plummeted in many local cities, a report revealed Tuesday. Home sales slumped 32 percent compared with March 2007, according to the San Mateo County Association of Realtors.”

“‘Housing prices are still high in relation to what most people are paid around here,’ said Stephen Levy, an economist and director of the Center for the Continuing Study of the California Economy in Palo Alto. ‘The prices aren’t sustainable, and they’re still near historic highs.’”

“Levy added that many homes are not worth what they were at the peak of the market a couple of years ago, and he warned that further price erosion is on the horizon.”

“The city of San Mateo’s median price fell 18 percent in March to $789,500, partly because of a drop in prices in the Shoreview area, which has experienced a number of foreclosures.”

“The North County, where many first-time buyers stretched to buy homes with subprime loans, continued to experience significant price erosion. Daly City’s median price fell more than $150,000 to $570,000, and San Bruno dropped more than $100,000 to $634,000.”

“East Palo Alto, another area hit hard by subprime loans and foreclosures, saw the March median price plunge to $382,450, off 43 percent from last year’s mark of $675,000. The median price in Monterey County fell dramatically to $430,000 in March, down from $800,000 last August.”

The Santa Cruz Sentinel. “Home sales plummeted in Santa Cruz County in January and February. So far, 138 have been sold, down 43 percent compared to a year ago, when 243 homes were sold in those two months. March sales statistics have not been posted yet.”

“Of the 11,000 borrowers in Santa Cruz County with adjustable-rate mortgages in the last quarter of 2007, about 7.6 percent were three or more payments behind, 3.5 percent were in foreclosure and 1.6 percent had been sold at foreclosure sales.”

“The trend is up from the first quarter of 2007, when 2.25 percent were behind in payments, 1.1 percent were in foreclosure, .43 percent had been sold, and the number of adjustable rate mortgages was about the same.”

“So many borrowers need help that the Santa Cruz Association of Realtors and its Housing Foundation have scheduled three foreclosure workshops Saturday.”

“One workshop covers what can be done when a homeowner is ‘upside down.’ Others cover the foreclosure time line and loan workout options. Admission to the expo is free, and materials will be available in Spanish as well as English.”

“At least 660 people have made their opinion known on changes proposed in Regulation Z, federal rules designed to protect consumers from unfair, abusive and deceptive lending, and so far, many of the comments are critical.”

“Tai Boutell of Santa Cruz Home Finance said some of the changes make sense, like requiring the lender to determine the borrower can repay for mortgage for at least seven years and requiring brokers to disclose front-end and back-end fees.”

“‘All the regulations should focus on entrance barriers to the profession,’ Boutell said. ‘It is easy to obtain a license, and many loan officers are not even required to have a Department of Real Estate license at all. Loan officers who work for banks are not required to have a Department of Real Estate license.’”

“Santa Cruz homeowner Boone White considers the changes too restrictive and likely to make it harder to buy a home.”

“‘I understand that the purpose is to protect the borrower against unscrupulous lenders but it reads like an act to take 100 percent of the risk out of purchasing a home,’ he said.”

“‘If all loans required the documentation, it would cause folks to buy within their means, but it does not take into account situations like ours,’ said White, an attorney married to a physician. ‘We could not have purchased our home as we were just beginning our careers. Now, we are established, so we are OK.’”

“Santa Cruz resident Peter Ogilvie, president of the California Association of Mortgage Brokers…said requiring borrowers to put money for taxes and insurance into an impound account can be very expensive and could put loans out of reach.”

“He questioned the fairness of a provision singling out brokers to disclose income and not requiring the same of lenders.”

“Tom Mentzer, spokesman for Rep. Sam Farr, said Farr ‘has always supported these types of protections for homebuyers. It’s the so-called ‘liar loans’ and a lack of responsibility from a small segment of lenders that got us in trouble in the first place.’”

“Some question whether the Federal Reserve is the proper tool to enforce these protections. In the past, the Federal Reserve focused on broader oversight.”

“‘We saw a failure to enforce the rules that were in place,’ said Mentzer. ‘That, combined with a blind eye toward questionable practices, led us to where we are. It’s never just one cause. It’s too bad the alarm wasn’t sounded earlier.’”

“Susan Stawick, spokeswoman for the Federal Reserve, said staff would review the comments and determine how to proceed. To those critical of the agency’s rule-making, she said, ‘The Federal Reserve used the authority it has under Regulation Z.’”

“Federal Reserve chairman Ben Bernanke advised Congress the final rule would be ready later this year.”

Some housing bubble news from Wall Street and Washington. Staten Island Advance, “Rep. Vito Fossella has an idea on how to jump-start the moribund housing market: Give folks a $10,000 break on their federal taxes if they buy a home. Fossella pushed his bill during a press conference yesterday in front of George and Margaret Brodbeck’s home in Great Kills, a well-kept four-bedroom that the couple has had on and off the market for the last year.”

“After 36 years on Katan Avenue, Mrs. Brodbeck said she was looking to downsize and move closer to her mother in Dongan Hills. She thought selling would be easy.”

“‘We were accustomed to homes in this area selling very quickly. Mentally, I thought I’d be leaving immediately. I was very, very surprised,’ she said of the lack of buyers.”

“The house is back on the market now for $579,000.”

“‘This legislation would help folks like George and Margaret, as well as millions of other buyers and sellers across America,’ Fossella said.”

“Fossella said the House is currently considering a $7,000 tax credit for people who meet certain income limits and purchase foreclosed homes. ‘It clearly is not reflective of what will work here on Staten Island,’ he said.”

“He pointed to a 40 percent drop in home sales over the past seven months and a 400 percent spike here in foreclosures during the first quarter.”

“‘Anything that will jump-start the market for us and customers and clients is certainly important,’ said Dawn Carpenter, president of the Staten Island Board of Realtors.”

The New York Times. “The Bush administration and Democratic leaders in Congress are counting on the Federal Housing Administration to rescue hundreds of thousands of homeowners from foreclosure by helping them refinance from risky subprime loans to stable government-backed mortgages.”

“But the F.H.A., the government agency that insures home loans for many first-time, minority and lower-income buyers, is grappling with financial woes of its own.”

“Housing officials say the agency will face a deficit for the first time in its 74-year history, starting in the fiscal year that begins in October. And they blame a rapidly growing and increasingly troubled sector of the F.H.A.’s mortgage portfolio, known as the seller-financed down payment loan program, which has suffered from high delinquency and foreclosure rates in recent years.”

“The nonprofit companies say they actually helped make the F.H.A. competitive by providing down payment assistance, attracting home buyers to the F.H.A. who might have gone elsewhere.”

“‘All we do is give them the down payment money to get them over that obstacle so they can start enjoying the benefits of homeownership,’ said Ann Ashburn, president of AmeriDream of Gaithersburg, Md.”

From CNN Money. “Housing counselors are often the last and best line of defense for borrowers facing foreclosure, and the $15 billion housing rescue bill now before the Senate allocates $100 million for foreclosure prevention counseling.”

“But most housing advocates agree that cash isn’t the biggest obstacle to achieving this goal - lender cooperation is. ‘The counselors are working as hard as they can,’ said Jim Carr, chief operating officer for a non-profit neighborhood advocacy group, ‘but the servicers are not cooperating.’”

“Only about a quarter of the borrowers helped by members of the Hope Now alliance - the coalition of lenders, investors and community groups spearheaded by the Treasury Department to fight the foreclosure crisis - have actually had the terms of their mortgages made more affordable.”

“The rest of the 1.1 million borrowers Hope Now has helped were simply given extra time to make up their missed payments.”

From Your 4 State in Maryland. “You’ve heard a lot about the troubled housing market, but there’s always another side to the story. Buyers in our area are getting great deals, especially on foreclosed homes.”

“‘It’s a fabulous time with a lot of foreclosures. Probably one third of the houses I showed were foreclosures,’ says Cynthia Moler, a realtor with Coldwell Banker.”

“The market may take some adjusting from sellers, but it’s ideal for buyers. The Senate is now debating a bill that would give a $7,000 tax credit to anyone who buys a foreclosed home.”

“Realtor Jeff Matthews recalls one of his previous deals. He says, ‘I had it listed about a year ago for about $329,000 and it went to foreclosure. I saw it on the market last week for $239,000.”

“Moler adds, ‘Before, it was a terrible thing to be in foreclosure. How embarrassing. But now, it seems to be happening to everyone.’”

“That means many of the houses are in desirable areas. ‘A lot of the properties that are in foreclosure or are getting ready to be in foreclosure are in fantastic neighborhoods, some of the best neighborhoods in our town,’ Moler says.”

The Boston Globe. “On April 16, Housing For All, a nonprofit organization that promotes the development of affordable housing, will cosponsor another forum, ‘Foreclosures in Metro West: Exploring Federal, State, and Local Efforts to Address the Crisis.’”

“‘Part of our mission is to wake Framingham up to how serious the issue is,’ said executive director Chris Ross. ‘There are things that town government needs to look at.’”

“The South Middlesex Opportunity Council, a Framingham-based social service agency, can offer small loans to homeowners in a temporary pinch. If a homeowner already owes several thousand dollars, the agency usually refers them to legal services, according to Ozzy Diagne, director of its Housing Services Center.”

“The agency also can help sell a property quickly before foreclosure or negotiate a deal with the lender to prevent its seizure, he said, but most residents aren’t aware of their options.”

“‘Faced with foreclosure, they usually just pack and leave,’ Diagne said.”

The Idaho Mountain Express. “Because of its affluence, the Blaine County economy is buffered to some degree from the national economic engine, but there’s no doubt the nationwide real estate crunch is hitting home.”

“In the first three months of 2008, seven Blaine County properties were foreclosed, according to Sun Valley Title Co. It’s a statistic that builds dramatically on three years of steadily climbing figures. In all of 2005 there were three. In 2006 the number jumped to five, and in 2007 there were 12.”

“Sun Valley Title Co. Manager Cassie Jones said that for people with no equity in their homes, sometimes it’s cheaper to pay rent, and those who took too much of a risk to buy a home are turning their backs on their investments gone bad.”

“‘One of the problems: People are just walking away from homes,’ Jones said. ‘The government is trying to do things, give longer grace periods. It’s just a whole vicious cycle that starts here and who knows when it stops?’”

The Mail Tribune from Oregon. “As the nation’s subprime mortgage crisis comes to a head, more houses are being abandoned in Medford, real estate agents and city officials say. Foreclosures have skyrocketed, and more than 750 Jackson County property owners defaulted on mortgage payments in 2007.”

“Garbage bags, children’s toys, lawn care equipment and beer bottles are strewn about this east Medford house, valued at $453,000. Inside there’s a piano; outside, there’s a swimming pool filled with murky green water. There’s so much junk the city has posted notice that the accumulation is unlawful.”

“But there’s no one home to clean it up. Unable to make mortgage payments, the homeowners walked away.”

“Dave Myers, an agent in Medford, is marketing the abandoned east Medford house, but he doesn’t know the owners’ story. Myers, who has been marketing foreclosed property for banks for 10 years, said since October 2006, the number of default notices that have been filed in Medford has jumped from three or four per week to 30 or 40 per week.”

“‘There are probably a couple hundred (houses), I would say, that have reverted back to the bank,’ he said. ‘It happens on all income levels,’ he said, adding that house values in foreclosures he handles range from $85,000 to $650,000.”

“On the other side of town, the city finally had to board up the windows of an abandoned house because of vandalism. The West Eighth Street house has a real market value of $178,000. City officials say the homeowners walked away from the little house, probably because of foreclosure.”

The Daily Star. “The increase in foreclosures has been seen across New York state and the nation, said Philip Lentz, director of communications for the State of New York Mortgage Association, which helps low- and moderate-income families become homeowners.”

“Patrick O’Rourke, a housing counselor with Quaranta Housing Services Center, part of Opportunities for Chenango in Norwich, said too often someone in financial trouble doesn’t make his mortgage a priority and ignores mail about delinquencies, thinking the problem will go away.”

“When someone arrives in a shiny new truck to discuss missed mortgage payments, O’Rourke said, he asks if that person wants to live in his or her vehicle.”

“O’Rourke added that he repeats an adage he heard many years ago: ‘Even if you have to eat dirt, make your mortgage payment.’”

From The Day in Connecticut. “A typical homeowner in New London County has lost $22,000 in equity over the past year, according to figures released Monday.”

“Fairfield County, which had driven much of the real estate splurge statewide over the past few years, saw sales down more than 28 percent in February and median prices off nearly 7 percent. In the stratospheric world of Fairfield County real estate, this meant a drop of nearly $40,000 in median prices, to a still-amazing $517,250.”

“‘In both Connecticut and in neighboring Massachusetts, sales began to drop in late 2005,’ said Timothy Warren, CEO of The Warren Group, in a statement. ‘In Massachusetts, prices began to follow in 2006. But in Connecticut, it has taken until now to see the declining sales catch up with the prices.’”

“Vincent Valvo, group publisher for The Warren Group, said the lower end of the market, which represented about 30 percent of all loans in 2006, was hit hard by the subprime mortgage meltdown, to the point that many potential homeowners have nowhere to turn for loans.”

“‘That’s a reflection of the complete evisceration of the subprime and low-documentation segment of the market,’ Valvo said. ‘A big chunk of the market isn’t buying anymore.’”

“Still, Valvo said increases in home prices of 10 to 15 percent were unsustainable, a result of irrational exuberance, and he, for one, thinks that is a good thing.”

“‘That’s not going to happen in the next 10 years, and how would our salaries keep up without it leading to rampant inflation?’ he said. ‘We really ought to be grateful.’”

From The Sun. “The value of Britain’s homes slumped by a staggering £100 billion last month, shock figures revealed yesterday.”

“Lib Dem spokesman Vince Cable said: ‘The Government is only just waking up to the problem, despite the fact it has been warned for years that there were great economic dangers from the bubble in the housing market, linked to exceptionally high levels of personal borrowing. For too long this Government did nothing.’”

“‘There will be an epidemic of repossessions unless the Government forces lenders to moderate the process by offering shared ownership and payment holidays to keep people in their homes,’ Cable said.”

“Halifax recently calculated that the UK’s housing stock was worth £4trillion, meaning last month’s fall wiped off £100 billion of value, said banking analyst Bruce Packard.”

“He added: ‘It’s bad news for all those estate agents who assure me house prices will always go up because Britain is an overcrowded island.’”

From Aftenposten. “More than 140 Norwegian building firms have filed for bankruptcy so far this year. Concerns are growing that Norway’s building boom of the past several years is quickly turning to bust.”

“The amount of building bankruptcies is up 30 percent over last year. Most of them are linked to customers’ inability or unwillingness to pay their bills.”

“‘It was difficult to draw in the money, especially from the private market,’ said Petter Håkelien, who led a company that filed for bankruptcy just before Easter. His firm, which specialized in building garages and homes, had 20 employees and annual turnover of about NOK 15 million (NOK 3 million).”

“He told Aftenposten that he thinks others in the field will be forced to go out of business as well. ‘I predict that 2008 is going to a real downturn for many of them,’ he said. ‘Everything we earned during the good times has been eaten up by price hikes and higher pay for workers.’”

“New statistics also show a fall in new home sales of as much as 20- to 30 percent. Prices in both the new and resale home markets have also been showing signs of slippage.”

“Håkelien told Aftenposten that he thinks the ‘large and well-established’ firms will survive, even though ‘the good times are definitely over.’ After 25 years in the business himself, he said he’s thinking about finding a completely different line of work.”

Wink News reports from Florida. “The housing market. It’s been a dirty word in Southwest Florida as the insatiable appetite for real estate hits starvation mode. ‘It’s always on your mind. Is it going to sell and when is it going to sell?’ said Rachel Hilsmann. ‘We originally started at about $315,000 and this is the 3rd time we’ve had it in the market and we’re now at $199,900.’”

“They’re questions that Hilsmann hopes to soon get answers to. She and her husband bought a condo as an investment more than two years ago. $30,000 in upgrades later, still no luck with selling it.”

“Numbers from the Realtor Association show that the percent of sold to active listings in the greater Fort Myers area, has nearly doubled in the past 12 weeks. And buyers are getting some pretty good deals. Some agents also say they’re seeing three bedroom, two bath houses under $200,000.”

“‘A couple years ago, It was up to $200 a square foot. I just saw something today that was $63 a square foot,’ said Realtor, Jen Buffington.”

The Tampa Tribune from Florida. “Bill Lee, a top executive with Sabal Homes in Lithia, always assumed he would bring his son Brian into the family business. But now that Brian is in college and thinking about a career, Lee has had to pass on some unpleasant advice instead: Better get a Plan B.”

“The reason: Brian Lee is about to enter the work force at a time when small homebuilders are weathering one of the toughest housing markets in decades. It’s forcing some builders to consider closing.”

“‘It’s a tough time to get into this business,’ said Bill Lee, vice president of operations at Sabal Homes.”

“During Florida’s recent housing boom, Lee said, his list of competitors grew. ‘A lot of people jumped into this business who shouldn’t have,’ he said. ‘They went from foreman to owner-operator. Some of those folks aren’t making it now.’”

“Some of the newer builders, said Sunrise Homes VP Bob Appleyard, were quick to build as much inventory as possible to meet the expectations of buyers. When the demand began to wane, they were left with too many empty homes they couldn’t sell.”

“‘It’s what some people called the greed factor,’ Appleyard said.”

“It’s a tough lesson to learn, he said. ‘I suspect next time we have a run-up home cycle, builders will get stuck with too much inventory again.’”

The Sun Sentinel from Florida. “Some South Floridians who lose their houses to foreclosure try to get even. They’ll strip the plumbing, ruin the carpets and rip out doors.”

“Jim Banford, broker-owner of Real Estate Asset Disposition Corp., saw roofing tar in the toilet of a house in West Palm Beach. A 2-foot fish and cement were poured down the toilet at another of his listings nearby.”

“‘I’ve seen everything, but that was pretty memorable,’ said Banford, whose West Palm Beach-based firm markets and resells foreclosed properties across Florida.”

“Exasperated lenders are getting wise to the ruse and offering ‘cash for keys’ deals, essentially paying homeowners as much as $2,000 not to take out their frustrations on their properties before leaving. Roughly half of all foreclosed properties are returned to the bank with substantial damage, according to a national survey of 1,500 real estate agents.”

“‘Unfortunately, it’s always the bank’s fault,’ said Wes Yancsurak, an agent in Jupiter. ‘In a lot of cases, we have to bring in big dumpsters to clean these properties out. It’s just an absolute disaster.’”

“A North Palm Beach house sold recently for $225,000 in a neighborhood where homes are valued at $300,000 or more. A Cooper City house had been appraised at $349,000 but likely will go on the market for $225,000 because it’s in such poor condition.”

“Some owners skip basic maintenance once it becomes clear that Foreclosure is inevitable, said Terri Gerlach, an agent in Plantation. ‘People have fallen out of love with their homes, and they treat them badly,’ Gerlach said.”

The Montgomery Advertiser from Alabama. “Last month, only about 3,500 of the 43,000 homes on the market statewide found buyers, according to the Alabama Center for Real Estate at the University of Alabama. The time it’s taking to sell a home and the prices being paid are well off what they were just a year ago in the River Region, just as they are across the state and the nation.”

“Sandra Nickel has been a fixture on the local real estate scene for nearly 27 years. In the last three years, she has watched the housing inventory in the River Region more than triple — from 1,800 to 6,000.”

“Leonard Zumpano, chair of real estate and professor of finance at the University of Alabama, estimates it would take 12 months to clear the inventory. At this time last year, there were 20 percent fewer homes for sale in Montgomery.”

“‘We had an irrational market that was skewed by easy credit,’ Zumpano said. ‘And sooner or later, it’s kind of a greater example of a fool theory — you think you can afford it, and the market conditions change and you’re stuck with this property.’”

“Catharine Olson put her home in Prattville’s Kingston Oaks subdivision up for sale a year ago February, hoping it would sell by the time she moved in June to join husband Daniel in Mississippi.”

“The house didn’t sell before the Olsons moved, saddling them with the $900 mortgage payment for another five months. Fortunately, the family didn’t buy a home in their new community of Columbus.”

“‘It was stressful every month,’ Catharine Olson said in a telephone interview from Mississippi. ‘You keep playing a head game with yourself, and keep thinking this month it will sell.’”

The Sun News from South Carolina. “Tough times in the real estate market means many Realtors are calling it quits, according to the Coastal Carolinas Association of Realtors.”

“About 963 members of the association decided not to renew their membership this year, bringing the number of Realtors on the Grand Strand to about 3,100, said Charlie Brindel, the association’s executive VP.”

“The decline is a change from the days of the housing boom when there were 80 to 100 new Realtors on the Grand Strand every month. The number of Realtors doubled between 2004 and 2006 when home and condo sales were skyrocketing.”

“That was when it was a sellers market. Realtors got multiple offers on any given property, and offering prices were often higher than what sellers asked. ‘People would line up,’ said the association’s market analyst Tom Maeser. ‘They didn’t even have to run ads.’”

“Now, buyers have the upper hand because there’s a surplus of inventory that sellers are trying to unload. That also means Realtors have to work harder to make a sale.”

“‘I think a lot of people got into real estate when real estate was easy. Anybody could have sold real estate in 2005,’ said Travis Miller, broker in charge of Exit Realty. ‘Now it takes skill and perseverance and determination. You’ve got to take it seriously.’”

“Penny and Michael Mims, who became full-time Realtors in 2007, said that even the most aggressive of marketing plans weren’t enough for them to break even selling real estate. They decided to get new jobs in December after losing about $9,000 on advertising and spending more than 40 hours a week trying to make a sale.”

“‘We ended up listing about five houses and sold one,’ Penny Mims said. ‘You just can’t make a living doing that.’”

Please post off-topic ideas, links and Craigslist finds here.