Think, Wink And Double Blink Won’t Work
The Aspen Times reports from Colorado. “Homeowners in the heart of Basalt saw their property values plummet by up to 60 percent while Aspen-area residents saw their home values drop around 20 to 30 percent in the May 1 reappraisals required by the state. ‘Everything is more than 30 percent of a reduction,’ said Garret Brandt, an attorney and real estate agent who is a partner in a firm that handles appeals by property owners. There were a significant number of homes with more than a 50 percent drop in value, he added. ‘The Willits lofts were absolutely hammered — more than a 50 percent drop,’ Brandt said.”
“Basalt Councilwoman and River Oaks homeowner Jacque Whitsitt saw her home value fall 48 percent. ‘I’m not surprised,’ Whitsitt said. ‘I hope it’s reflected in the property taxes.’”
“Outside the metro area, the Buttermilk Road home of Gordon Gerson was down 30 percent while the Gateway-to-Snowmass home of Bob Guion was off 31 percent. ‘I think where it’s at now is appropriate,’ Gerson said of his reappraisal. He said he felt the valuation in May 2009 was too high. ‘My reaction two years ago was, ‘Where are their numbers coming from?’ he said.”
The Post Independent in Colorado. “When the recession ended the boom times of the first decade of the 21st Century, it left the lights out in thousands of unoccupied homes across the Roaring Fork and Colorado River valleys. Results of the 2010 U.S. Census show vacancy rates climbed from Aspen to Parachute, largely as a result of new construction outpacing demand after the housing bubble burst.”
“‘Definitely in the state we’ve had overbuilding,’ said Elizabeth Warner, state demographer with the Department of Local Affairs. ‘I think everyone is well aware of that now. There’s a ton of different issues. There are a lot of people that got into second homes that shouldn’t have been in them. There are a lot of people that got into first homes that shouldn’t have been in them,’ she said.”
“‘You drive through the mobile home park and you’d be shocked at how many of them are empty,’ said Battlement Mesa resident Ron Roesener, who counted 11 empty homes in his own neighborhood, many of which were in foreclosure.”
The Gazette in Colorado. “How long has Terry Pixley been appraising residential real estate in the Pikes Peak region? Mighty long. He started nearly 50 years ago Q: What big-picture factors are affecting residential values? Distressed properties? Supply and demand? High unemployment/economic slowdown? Or something else?”
“A: All of the above, which has infected the mindset of some potential buyers waiting for the bottom. High unemployment and/or low-paying employment along with the very tightened lending practices are other reasons.”
“Q: Are some areas of the Pikes Peak region being harder hit than others when it comes to residential values? If so, which areas? A: Some of the most noticeable areas I see are the newer subdivisions, where many buyers paid the highest prices in 2005-2006. Other properties being hard hit are most newer, average- to lower-priced townhome projects and especially condo projects. Also, eastern El Paso County, where a majority of manufactured housing exists, has been hit very hard.”
The Ahwatukee Foothills News in Arizona. “A sweeping change to Arizona’s impact fees on new houses should mean homebuyers will see their money put to use faster, but critics warn communities could have to hike taxes on existing residents. But Queen Creek Town Manager John Kross said the law may shift the cost of growth to existing residents. The town saw new housing construction fall 85 percent from five years ago, and it’s running out of reserve funds to pay debt on roads, water lines and other projects constructed to serve new subdivisions. The law provides exceptions on debt already issued, but Kross said it’s still possible cities would have to refund money when growth falls below projections.”
“‘It really has the propensity to upend the philosophy that’s always been in Arizona, and that’s that growth needs to pay for growth,’ Kross said. ‘Those bills still have to be paid by someone, and that absolutely will have to be picked up by existing residents,’ Kross said.”
The Arizona Republic. “In a reversal from statements a week earlier, Realty Executives Inc. confirmed Friday that it intended to file for bankruptcy protection ‘within the next 48 hours.’ The announcement to staff and contractors came just eight days after Rich Rector, Realty Executives owner and executive chairman, had issued a staffwide memo reassuring personnel that the firm was financially stable. Realty Executives is based in Phoenix.”
“Rector said in the memo that the company was trying to resolve the lease problem by working with property owners to negotiate lower payments. ‘We have a plan in place and are working to complete this process with our various landlords,’ he said. He concluded by saying, ‘We have a history to be proud of and an exciting future ahead. Realty Executives is here to stay in Arizona and worldwide.’”
The Arizona Daily Sun. “Joe Ray shouted at passing cars as each entered the Chase Bank parking lot on Milton Road in Flagstaff Wednesday afternoon. ‘Come on in,’ Ray roared. ‘They need your money.’”
“It has been more than a month since the bank forced the unofficial mayor of Sunnyside out of his home through foreclosure. Ray, now living in a motorhome with his tiny dog, kept a cheerful demeanor throughout the two-hour protest. He held a handmade protest sign that read: ‘Chase: The Foreclosure Kings!’”
“‘I am here today to let the whole world know what these banks are doing today,’ Ray said. ‘The only thing they care about is that green dollar bill in your wallet. Believe me.’”
The Park Record in Utah. “The Park City Board of Realtors’ first quarter report shows that sales activity so far this year is on par with 2010. The report also suggests prices of single-family homes, condominiums and land sales remain low. Mark Seltenrich, previous president of the Board of Realtors, said 35 percent of all sales this quarter were either foreclosures or market sales. ‘The first quarter of 2011 had 125 distressed sales and 125 foreclosures. Every foreclosure in the market sells in Summit and Wasatch County,’ Seltenrich explained.”
“Recent news from Aspen, Colo., indicated that its economy is in recovery mode. However, Seltenrich clarified, ‘our high-end homes just aren’t as expensive as Aspen,’ he said.”
“According to Seltenrich 38 home sales and 74 condo sales occurred within the Park City limits, “the median price of homes inside the city limits is $990,000, while the median condo is priced at $611,000. When asked if there is much hope for an upswing in the market, Seltenrich was cautious. ‘Reflection on reality, whether it’s good or bad, depends on your viewpoint,’ Seltenrich said. The first quarter was good because the number of sales was up, he said.”
“The owner and CEO of Prudential Utah Real Estate, Steve Roney, projects that the number of distressed properties will be the same as last year. ‘The lack of significant success in loan modification programs has contributed to the high level of distressed sales,’ Roney said.”
The Salt Lake Tribune in Utah. “The Wasatch Front’s residential real estate market continues to show signs of improvement, but both sales and prices in most areas remain below last year’s levels, a new report shows. Realtors attribute the declines over the past year to the expiration of the federal home-buying tax credit, which boosted sales in last year’s first quarter, only to cause a drop off in sales after the credit expired in April 2010.”
“Salt Lake City economist Jeff Thredgold, a consultant with Zions Bank, said he wouldn’t be surprised to see home prices along the Wasatch Front stop falling by late this year or early 2012. ‘Everyone is disappointed it just keeps taking longer and longer for the housing market to stabilize,’ Thredgold said. ‘But we still have high level of foreclosures and distressed properties, which are a drag on the market. And they aren’t going to go away anytime soon.’”
“According to foreclosure-listing company RealtyTrac, Utah is one of the top five states most hard hit by the nation’s foreclosure crisis, along with Arizona, Nevada, California and Florida.”
“Heather Peeters of Murray has seen her and her husband’s incomes shrink during the recession as the restaurants they work for have been affected by reduced consumer spending. The couple, which is seeking a loan modification from their mortgage company in an effort to keep up with their monthly payments, also have seen their home value fall by about $30,000. ‘The last time we opened our [property] assessment, it was down again,’ Peeters said. ‘It’s been steadily going down the last couple of years, so it hasn’t been that much of a surprise.’”
The Las Vegas Tribune in Nevada. “I will gladly pay you Tuesday for a hamburger today. Catch you on the flip side. I’ll take mine out on the back end. We’ll settle up later. Before writing about it, I waited patiently for the financial crises (plural of crisis) to work themselves out and at least stabilize. I can’t wait any more.”
“The word ‘crisis’ comes from the Greek word for decision or time for decision. Boy is that right. Time for some major decisions, which will affect all of our lives for a long time.”
“All the rhetoric about the regulatory safeguards imposed after the 1929 stock market crash, including the SEC, the FDIC and the formation of Fannie Mae and Freddie Mac, was just political snow. Or maybe not; perhaps our problems would be much worse without the government regulation that was imposed. Or maybe they came later. Or maybe they were magnified.”
“Newsflash: the rest of the world is quickly losing faith in the American dollar. And it doesn’t have anything backing it. Now I guess we’ve got it backed by the mortgages on our own houses, since the feds took over Fannie and Freddie. Some say the feds may make a trillion or two on the transaction. Yeah, right. When was the last time the government could even break even? But they did buy the mortgages for literally pennies on the dollar, and they have only lost 30 percent of their value. And, this is hard to believe: 90 percent of mortgages are current. That’s what’s hard to believe: how incredibly thin this market was; with 10 percent bad debt, an entire industry collapsed.”
“Let’s see: if a million is a thousand thousand, and a billion is a thousand million, then a trillion is a thousand billion. Is there even a number for a thousand trillion? I’ve only heard the word trillion in the last year or so. Maybe the word is gazillion. Or quadrillion. Maybe we can be creative and make up some new word like bushillion, idiotillion, buckillion, or just use thousand-trillion, then thousand-thousand-trillion and so on.”
“Folks, we’ve reached the tipping point where (1) we’re using words we haven’t used before and (2) there aren’t even words to describe the numbers we’ll soon be discussing. We’d better make the right decision.”
“The one ounce American Buffalo gold coin is worth well over the $1,500 bullion value. I suggest minting some new coins to raise revenue in this time of crisis, by memorializing the reason for the coinage. Have some fun with it. Promote them as collectors’ items. Here are some suggestions. -Banker unemployment coin. Faceless suits standing in front of an unemployment office. Or a bank drive-through line for unemployment checks, with expensive sports cars driving through. -Foreclosure coin. A house with the word ‘foreclosed’ stamped across it. It’s 1/2 ounce of gold, but costs the same $1,500 as the American Buffalo gold coin.”
“Such diverse movies as ‘It’s a Wonderful Life’ and ‘Mary Poppins’ have themes about the proverbial run on the bank. The banks can’t pay one depositor, so the others don’t want to be the last ones to get paid, and you know the rest. When demands are made on George Bailey’s bank, he can’t pay them because, as he explains, he doesn’t have the money because it was loaned out secured by the houses that the neighbors Ester and George and Carl and Jose and Maria live in. When the George Bank’s bank refuses to give the kid his money in ‘Mary Poppins,’ the other customers see it and the news quickly spreads, so then everyone wants their money. Supercalfragalisticexpialadosious. Mary Poppins explains that’s what you say when you don’t know what to say.”
“One thing is for certain: we’re not going to be able to get out of this mess the way Bert and Mary Poppins did. Think, wink and double blink won’t work. We need real solutions real fast.”
