The Housing Bubble

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It’s Friday desk clearing time for this blogger. “When Donna Vieira bought a $560,000 home in Reno in 2005, the San Leandro, Calif., resident thought she had the perfect second home. Six years and $350,000 worth of payments later, Vieira finds herself out of her Reno property and in the middle of an extended legal battle against Wells Fargo. Vieira alleges that she was the victim of both a fraudulent loan and a fraudulent appraisal. A second appraisal that came as she closed escrow revealed that the value of the home she bought was $243,000 less than the mortgage she signed, Vieira said. Vieira was so upset that she reported the original appraiser, whose license eventually got suspended.”

“‘I haven’t even moved into the house yet when I found out,’ Vieira said.”

“For Jenny and Robert Click, the loss of their Dale City home, scheduled to be sold at a foreclosure auction Jan. 6, has loomed over their holidays. Last week, the only sign of Christmas was the tree that took up a corner of the living room, where Click said she had cried tears of joy the day her family moved in 11 years ago. ‘I was thinking I had finally made it,’ she said. ‘I had my own house.’”

“When they bought the three-bedroom house for $87,000, Click was earning $18 an hour driving a dump truck. Robert Click was earning slightly more by driving a truck for a construction company. Once the run-up in house prices began, she said, they were bombarded with offers to refinance. They did so twice, pulling out $70,000 in equity to make much-needed repairs to the roof and a bathroom and to pay off their cars.”

“‘It’s like free money,’ is what they said,’ she recalled. ‘Except that it’s not free!’”

“The average Maryland home reassessed last year lost a record 22 percent of its value, while the average drop the year before was nearly 20 percent, assessors said. It’s hard for a homeowner to decide how to react to falling assessments, said Carlos Plazas, who lives in Patterson Park, one of the Baltimore neighborhoods the state just revalued. He likes the idea of a lower tax bill, but it would also mean that homes in his neighborhood have lost value. ‘I don’t know if it’s a good thing or not,’ said Plazas.”

“Winfield realtor Joan Turner, who tracks homes that may be headed for foreclosure, observed the price of many homes in foreclosure lately has been between $50,000 and $60,000. In addition to the moderately priced homes listed in foreclosure filings this fall, there were also a few with higher and lower mortgages, including a home with a $132,000 mortgage and a mobile home with a $6,000 mortgage.”

“But the picture was changed from 2009 and 2010, when foreclosure filings included homes with mortgages of up to $350,000. More than one high-end homeowner simply walked away during that period, Winfield realtor Alan Herrman said. Both Mike Mildfelt, president of the Community National Bank in Winfield, and John Sturd, community president in Arkansas City for the Union State Bank, pointed to lax mortgage-making on the part of brokers and outside lenders as a prime cause of those troubles.”

“‘There were a large group of folks who were not prepared to own a home’ who got mortgages in the 2005-2006 period, Mildfelt said.”

“With foreclosures still hitting the housing market hard, at least one metro city is so wary about empty houses turning into rundown rental properties that it plans to limit the number of rentals allowed on each block. Those types of rules are already established in Minnesota college towns such as Winona and Mankato, but as metro areas seek to try them, it could lead to a battle: property owners who can’t sell their vacant houses and say they could face foreclosure if they can’t rent them out vs. cities that say too many rentals can drag down everybody else’s property values.”

“City Council Member Jim Englin said too many rental properties can crush a neighborhood. ‘If I have three renters around me and you are telling me my housing value doesn’t go down, you are wrong.’”

“The Dzierzbickis live in Cary, Ill. They bought a house in Winona for their daughter while she attended Winona State, and they have been unable to sell it since her graduation this past spring. Although they spent $30,000 to upgrade the house for safe renting, the city wouldn’t let them rent rooms to students when their daughter was there, and it’s standing empty now because of the rental restriction, Ted Dzierzbickis said.”

“‘I have a very strong personal belief that the city is overstepping its bounds by telling us we can’t rent a property that we own,’ he said.”

“The well-known Northside Realtor at the other end of the phone line was angry. She had just come from a foreclosure closing on a $150,000 house. The defaulting homeowner, who put no money down and only made three payments, walked away from the closing with a $13,000 check, thanks to various government programs.”

“‘This is just wrong,’ she said. ‘The man makes $11,000 a month as a salesman. He trashed the house and walked away with a big check. The public needs to know that this type of thing is going on.’”

“According to the Canada Mortgage and Housing Corporation, resales are likely to rise by nine percent in 2012, to 36,000 transactions. It also anticipates that the annual average price for all home types will settle at $788,000 in 2011, which is 17 percent over that of the previous year. For 2012, the average price is forecast to increase by two percent to $805,000.”

“Although houses are expensive in Metro Vancouver, Central 1 Credit Union’s Pastrick doesn’t view the regional market as being in a bubble. ‘A bubble in real estate or in any asset market usually needs to have a fair amount of speculation present as well as very easy money,’ Pastrick said. ‘Money is cheap but not easy.’”

“Royal LePage’s third-quarter House Price Survey indicated that home prices in West Van have increased a staggering 25 per cent, the largest jump in the region. A detached bungalow in West Van rose to $1.2 million, up from $900,000, while two-storey homes jumped to $1.3 million, compared to $988,000 in the previous quarter.”

“From January to September 2011, 969 detached homes sold in West Vancouver with a median price of $1,780,000. Over the same period last year, 537 homes sold at a median price of $1,488,000. Bill Binnie, broker and owner of Royal LePage North Shore, told The Outlook one reason for the dramatic increase in prices was a ’shift in consumer demand’ from Asian buyers from Richmond to West Vancouver.”

“West Van realtor Jason Soprovich told The Outlook this spring marked ‘one of the most feverish pitches in purchasing power’ he’d seen in nearly 20 years.”

“Alice Batista readiliy admits she was blinded by dollar signs and slick advertising when she dialed up the Trump hotel and condo sales office back in 2006. The single mother of three became convinced that $50,000 was a small price to pay to get in on the ground floor of what was, at the time, the glitziest new high-rise planned for downtown Toronto — the five-star Trump International Hotel & Tower.”

“In fact, Batista became so swept up in the hype, within a few weeks she’d put $165,000 deposits on two units worth $2.4 million. Only as the Kitchener-area woman signed the legal documents would she find out that one of the suites — a one-bedroom condo with library on the 45th floor — was owned by the director of sales for the project. Legal documents obtained by the Star show that sales director Adina Zak bought the preconstruction condo for $948,100 in 2006 and flipped it to Batista six months later for $350,000 more.”

“That $1.3 million flip of an unbuilt unit to a new buyer violates a key condition in sales agreements, imposed on most buyers by developer Talon International Inc. That condition stipulates that units can’t be sold until completion. But her boss, Talon chief executive Val Levitan, defends the sale, saying he had a “moral obligation” to let Zak — ‘and a few other customers’ — buy a unit and flip them for their own profit. ‘Adina has been with me for 11 years. She is a very dedicated person who I wanted to do a favour for . . . Sometimes you make an exception.”

“Zak refused to comment when reached by the Star: ‘We’re on vacation and she’s not taking any calls,’ said her husband.”

“Batista is kicking herself for getting so caught up in the condo craze and Trump name. ‘I don’t belong in Trump tower,’ says the woman who has bought, renovated and rented out several homes, but never condos. ‘I thought I’d be able to get a Trump tower suite for less than everybody else. I didn’t think I’d get rich. I just thought I’d make a little money and maybe have a place to retire someday.’”

“For those watching local real estate values, it’s a frequent question: ‘After we’ve suffered through all that we have, when will there be light visible at the end of the tunnel?’ There is no better metaphor to describe the journey of ups and downs-well, downs-of the Malibu market. Actually, there is light visible at the end of the tunnel! For a specific portion of the local market, the darkness is turning to bright light.”

“Annual sales over the past four years have averaged about 150 home units in Malibu, not nearly enough to sustain previous values. (That is, the sales pace has been inadequate unless the inventory also stayed very low, which it has not). Whereas the joyous 2003-2005 years saw the tally of Malibu home listings below the 150 level, it bloated to more than 300 this past summer. Thus, inevitable price drops, now in the 40-45 percent range from the peak, have resulted.”

“The supply/demand dynamics get worse the higher you go. For properties listed at more than $5 million there have been 19 sales recorded, with 105 properties on the market. Talk about being in a dark, narrow place.”

“At least this can be said about current times: It is more encouraging than 18 months ago when all of Malibu’s micro-market box cars were deep in the mountain, the light faded from the rear and imperceptible ahead, scant few sales and way too many sellers at every price. Not far down the tracks, particularly for lower-priced investment-seekers, comes the next real estate phenomenon: all those buyers who grew comfortable standing on the platform, not realizing the choo-choo left the station.”

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The Albuquerque Journal reports from New Mexico. “The Standard & Poor’s/Case-Shiller index released Tuesday showed prices dropped in October from September in 19 of the 20 cities tracked. Home prices have fallen roughly 32 percent nationwide since the housing bubble burst five years ago and are back to 2003 levels, according to the index. Homes that sold in the Albuquerque area in November did so at 2005 prices, as has been the case more often than not this year, according to data from the Greater Albuquerque Association of Realtors. The median price was $160,000, down 9.86 percent from last November.”

“‘New Mexico median prices continue to reflect the number of distressed properties still on the market,’ M. Steven Anaya, executive VP of the Realtors Association of New Mexico, said in a statement.”

Inside Tucson Business in Arizona. “Tucson’s economy is no longer ‘bouncing along the bottom’ and as 2011 comes to a close there are signs the recovery is accelerating locally, according to economist Marshall Vest, director of the Economic and Business Research Center at the University of Arizona. He cautioned there is a lot of ground to make up, but he expects the Tucson job market to recover all of the jobs lost during the recession by 2015. Continued distress in the housing marke has been altered by the recession as younger buyers no longer view home ownership as a worthy investment.”

“Vest’s colleague, Gerald Swanson, professor of economics, commented the recession had caused a change in terminology noting that economists never before had referred to 2 percent as ‘growth.’”

From NPR. “In the movie Groundhog Day, Bill Murray keeps waking up to live the same day over and over again. President Obama might feel the same way about the troubled U.S. housing market. In a 2009 speech in Arizona, he spoke about his plan to prevent foreclosures. ‘The American dream is being tested by a home mortgage crisis that not only threatens the stability of our economy, but also the stability of families and neighborhoods,’ he said.”

“But despite all kinds of federal initiatives, the housing market still hasn’t seen a real turnaround, which the president addressed this past summer. ‘[The housing market] is the biggest headwind on the economy right now,’ he said.”

Vegas Inc in Nevada. “With annual sales running at about 5,000 or less each year since 2009, no one is expecting a return anytime soon to the numbers seen during the economic boom. For Las Vegas-area homebuilders, the peak year was 2005 when sales totaled about 30,800. Dennis Smith, president of Home Builders Research, reported Friday that builders locally bought 250 building permits in November. That lifted 2011’s total to 3,348, down 21 percent from 2010.”

“‘It is truly amazing how much the new home industry has changed. Just five years ago we counted more than 23,200 new home permits,’ Smith commented.”

The Reno Gazette Journal in Nevada. “Statistics from CoreLogic show that 49,641 properties in Reno-Sparks — or 52.2 percent of residential properties with a mortgage — were underwater or upside down during the third quarter. For 2011, it could be possible to see upward movement in home values, not necessarily due to an improvement in market conditions but because of stricter foreclosure requirements resulting from AB 284, say some real estate watchers. The stricter law sharply has reduced the number of default notices filed in Washoe County from 612 in September to 13 in October and 15 in November.”

“‘New homes are unable to match the bargain basement prices of existing homes, over 60 percent of which are being sold in distress. Existing home prices have been relatively flat during the last few months, which is a good thing, but the sheer volume of distressed … and shadow inventory tells me that there’s nowhere but down for home prices until other areas of the economy begin to rebound. The ‘wild card’ in terms of sales volume is AB284, which has basically stopped NODs in Nevada. One thing is for certain: Banks will find a way around this,’ said Brian Kaiser, housing and real estate analyst, Center for Regional Studies, University of Nevada, Reno.”

“‘For 2012, I don’t see notices of default increasing anytime in the near future because I think it will take time for the banks to figure out how to comply with the stricter requirements from AB 284. As a result of that, you’ll probably see less inventory and an uptick in price. But I think this whole situation might cause a false bottom. You’ll still have all this distressed inventory just sitting there, and they have to be dealt with eventually. There’s also the question of whether there will be a trickle or flood of distressed properties entering the market once banks figure out what to do with AB 284,’ said Ken Wiseman, broker-owner, Reno Rancho Realty.”

The Associated Press. “Donna West could once name the homeowners on her affluent Las Vegas street. Then came the recession, the vacant homes, and the parade of anonymous renters. ‘To me, the recession hasn’t ended,’ said West, a 55-year-old retired state worker. ‘We have more foreclosures happening in my neighbourhood than a year ago.’”

“‘We are like somebody who is wearing a lead weight. We have jumped off the dock and finally stopped sinking, but that just means we are at the bottom of the sea,’ said Elliot Parker, an economist with the University of Nevada, Reno.”

“Evangelina Rodeiles works the night shift at the cafeteria at the Venetian casino-hotel on the Las Vegas Strip. Her house value has dropped from US$155,000 to US$80,000 in the past six years. Her husband is an under-employed construction worker. ‘I want to believe things are getting better, but I don’t see it,’ she said.”

The Aspen Times in Colorado. “Property tax collections for close to 50 taxing districts in Pitkin County will total $103.1 million in 2011, down 12 percent from 2010. Bills for the 2011 taxes will go out in mid-January, and not everyone will see a decrease despite the overall decline in collections. In the city of Aspen’s West End neighborhood, for example, a home valued at $3.7 million in 2011 will pay $9,402 in 2011 property taxes (with the bill that arrives next month). In 2010, the home was valued at $4.4 million and its tax bill was $9,354, according to records on file at the county assessor’s office.”

“‘In a declining market, it can be frustrating. The value of your property has dropped and yet your property taxes are going up,’ said John Redmond, county finance director.”

“On the other hand, an Aspen condo valued at $1.125 million in 2011 will see a 2011 property tax bill of $2,835. In 2010, the condo was valued at $1.83 million and saw a tax bill of $3,910. The condo’s value dropped about 27.5 percent. Because its value declined by more than 18.5 percent (the increase in the overall mill levy), its owner will see a drop in the property tax bill.”

‘In the midvalley, where property values generally dropped more substantially with the latest revaluation, property owners may be more likely to see a drop in their tax bills. A Basalt single-family home valued at $582,000 in 2011, for example, will see a tax bill of $3,477. In 2010, the home was valued at $878,400, and the tax bill was $4,248. The drop in that property’s tax bill comes despite a voter-approved tax increase for the Roaring Fork School District.”

“Dear Editor: I was recently in Dayton, Ohio. I stayed at a friend’s who lives in a multiuse development, akin to the Village at Crystal River (VCR) proposed for Carbondale: attractively built and depressing as hell. I wondered what the rich farmland that had been there looked like. Dayton’s economy is ‘in crisis.’”

“It got me thinking about Orange County, which reportedly used to have orange groves, as far as the eye could see. Now, it’s malls and multi-use developments, as far as the eye can see. And traffic: farther than the eye can see. Are they saving the economy? Hardly. The fastest-developed, Las Vegas and much of Florida, also happen to be the most depressed places in the country. Development for its own sake is disaster.”

“Think about California and other places that succumbed to ill-conceived development: so much building, with no thought to the future, the existing beauty of the place, or the actual needs of communities. (We don’t need 164 more housing units. How many for sale signs are in every neighborhood in Carbondale, including RVR? Do you know there will be 700 foreclosures in Garfield County this year?) Remember the lessons California gave us.”

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Readers suggested a topic on inventory. “Shadow inventory: How big? How bad? Deferred maintenance? Is it all legal? Collusion? What can we do? How many houses in your hood? Who’s responsible? Perhaps this is the game the banks are playing: pay the taxes, but don’t take title and let the ‘owner’ shoulder the liability. This let’s them, ‘wait to see what happens.’”

A reply, “Certainly not paying property taxes WILL get a property seized. Governments being what they are, it is my understanding that property tax liens ARE superior to mortgages. It used to be considered a slow process, but compared to the current foreclosure speed it it could seem pretty rapid.”

To which was said, “Not true of the property abutting us on Cape Cod. It was abandoned by a developer after putting in the foundation. People used it to dump their electronics instead there of paying a fee at dumps. It had been abandoned for years and the town said there was nothing they could do about it. I know there were years of accumulated back taxes involved and the town claimed they couldn’t find the owner. Yet for some reason, they wouldn’t/couldn’t seize. 10 years later, it’s still just an abandoned junk yard.”

One had this, “I’d like to see an updating of adverse possession laws. Basically, if the owner does not maintain a building and pay property taxes, it should be taken by someone who will. For properties in small town and rural locations which had aging boomers as the potential market, perhaps the aging boomers — now with retirement plans downsized to a subsistence lifestyle.”

“Free housing. No need to commute. A vegetable garden. Perhaps do it your self solar panels from Home Depot. Just need a few Social Security bucks for heat, property taxes, and internet service, and you’re good to go.”

A reply, “So, you are going to set up a town commission to take applications, decide who is ‘worthy’ to receive a free house and pass them out? Might work in a place so small that everyone knows everyone else and the people who most need/deserve the free housing are obvious and could sort of be picked by consensus. What if there are more empty houses than worthy recipients?”

“What about bigger places where that sort of work would be too overwhelming for volunteers, where people don’t know everyone? So, set us some sort of government office. Accept applications. Hire people to investigate the applicants. Let the neighbors interview the possible new person, maybe? And who pays when someone comes forward and sues the town.”

Another added, “You are making this way too complicated. See ‘Oklahoma Land Run of 1889.’ The government could make a fortune by selling the TV rights.”

The Commercial Appeal. “The AIA Stalled Projects Database is somewhat like an online dating service. But it matches developers and architects with investors to rejuvenate projects needing financing. ‘I think most architects will tell you they have stalled projects,’ said Lisa Namie, principal with the prominent Memphis firm, Fleming Associates Architects.”

The Daily Inter Lake. “After two years of development, it’s open house time for the Northwest Montana Community Land Trust and its 16 houses, all former foreclosures, up for sale in Kalispell. All of the houses were empty, bank-owned foreclosures before they were bought and renovated and placed in the land trust. ‘We have one [house] closing at the end of December and another one that will be closing probably in the first quarter of 2012,’ said Marney McCleary, the acting executive director of the land trust. ‘So we still have 14 homes unspoken for.’”

From Bloomberg. “Owners of more than 14 million homes are in foreclosure, are delinquent on their mortgages or owe more than their houses are worth, creating a shadow inventory that is holding down sales and prices, RealtyTrac CEO James Saccacio said.”

“Moody’s Analytics Inc. expects home prices to drop about 3 percent in 2012 as more foreclosed homes go on sale, Celia Chen, one of the firm’s housing analysts, said in an interview. By midyear, the distressed share of the market — foreclosures and short sales, in which the lender agrees to a price below the mortgage balance — will begin to shrink and average prices will start to rebound, perhaps as much as 5 percent in 2013, she said.”

“‘By the end of next year, prices will begin to appreciate,’ Chen said. ‘The fundamental driver of normal home sales is going to improve because we expect the economy will start generating jobs by the end of next year.’”

The San Bernardino County Sun. “The so-called ’shadow inventory’ of future foreclosures may be about to fall on Southern California’s real estate markets. In San Bernardino County, foreclosure filings jumped nearly 30 percent from October to November, new numbers show. Los Angeles County’s foreclosure activity jumped 15 percent.”

“In November, the number of San Bernardino filings for notices of trustee sales rocketed 80 percent to affect 2,253 homes. Those filings signal a new influx of distressed properties, said Kat Hegg, a real estate agent at Hegg Team Realty in Fontana. ‘That means they’re getting ready for a busy January,’ she said.”

“Adam Sands, program manager of the Housing Opportunities Collaborative of the Inland Empire, said various bureaucratic delays in the oft-confusing interactions between banks and homeowners may mean a glut of foreclosures is about to be released. The Housing Opportunities Collaborative of the Inland Empire is a nonprofit that essentially exists to create events where homeowners can have face-to-face meetings with lenders, counselors and others who may be able to struggling homeowners stay in their houses, Sands said.”

“In his interactions with homeowners, Sands said he has seen much ‘foreclosure fatigue’ among those dealing with paper barriers to loan modifications.”

“The difficult loan modification process may not be for everyone, he added. A short sale, in which a home is sold for less than the amount owed on its mortgage, may be a better option for some. Short sales are also notorious for being subject to prolonged and complicated proceedings. Any homeowner faced with foreclosure needs help from several specialists to endure any attempt to stay in their home, Hegg said.”

“‘They need a professional lawyer. They need a professional IRS consultant. They need a professional real estate agent,’ she said. ‘They want their agent to be all three of these, and they are not.’”

From Reuters. “Shirley Burnell, a community activist from Oakland, California, has been trying to get her subprime loan restructured since 2007. She never missed a payment, but the adjustable rate mortgage she got in 2004 shot up to a monthly payment she could no longer afford. First she provided documents without getting any response, then she was denied in April by her servicer, Bank of America, for not providing documents it never actually asked for.”

“When asked about Burnell’s case, a bank spokesman said she was unable to qualify under ‘imminent default provisions,’ a third reason that Burnell said she had never been given. At one point, Burnell even received notice the bank would accelerate foreclosure proceedings, despite her perfect payment record and the letter itself saying the bank owed her $281.01. ‘They gave you a funky loan in the first place, and now they’re refusing to work with people to get it worked out,’ Burnell said. ‘It just keeps you upset all the time.’”

The Savannah Morning News. “When the final numbers for the year are available, we’re going to see that single family home sales in the Savannah metro area climbed by about 15 percent in 2011 compared to 2010. But we still need to see total sales increase by about 40 percent just to get back to the historical norms for the annual turnover of existing homes. And, despite a decline in listed inventory over the past year, we still need to see the number of active listings fall by about a quarter to return to historical norms.”

“The process will be hampered by a large shadow inventory. Many bank-owned properties are sitting empty but aren’t listed for sale. Many homeowners would love to sell but are waiting till the market improves. I don’t have a clear handle on the exact size of the shadow inventory, but it is substantial. Chatham County had 158 single-family home sales in November out of 2,395 listings, according to MLS data. That works out to more than 15 months of inventory at the November pace of sales.”

“Lower priced areas such as the Southside and West Chatham typically have less inventory than more expensive areas downtown and on the islands. But current inventory for the Southside and West Chatham is more than 12 months. Yes, November is a slow month for sales, but it should also be a slow month for new listings and for overall inventory. Worrisomely, November’s new listings outpaced sales in Chatham County by two to one.”

“The good news is that some homes listed for sale in the Savannah area seem fairly valued right now. Some of those homes are in desirable neighborhoods that are not overburdened with listings. Some would have positive cash flow for new buyers if they were turned into rental units. But a significant number of residential properties don’t meet any logical pricing criterion. With supply and demand so far out of whack in so many neighborhoods, we’ll continue to see widespread declines in home values.”

“Georgia generally and Savannah specifically benefited greatly from new home construction during the boom years. But now we are stuck with an excess supply of homes and other buildings. We need to figure out how to grow the local and regional economy in the absence of a construction boom.”

The Green Bay Press Gazette. “On Wednesday, belatedly, the National Association of Realtors is scheduled to issue revised numbers that show the nation’s housing bust was worse than the big real estate trade group has reported all along. The public needs to keep in mind that the Realtors group represents Realtors, not real estate buyers or sellers, and not homeowners. Realtors get paid when transactions occur. So the members of NAR have a financial interest in promoting activity.”

“This isn’t the only realm in which the trade group’s priorities haven’t jibed with the public’s. One lesson of the housing bust is that federal subsidies for residential real estate must be reduced. The housing lobby, which includes NAR, is accustomed to fighting for these subsidies. Consider the recent dust-up over government guarantees for the loans on personal McMansions.”

“Taxpayers have lost an estimated $150 billion guaranteeing mortgage loans so far — and they’re on the hook for tens of billions more. Reducing the size of federally backed loans from gigantic to only slightly less gigantic was a first step toward unwinding these costly obligations and returning the marketplace to private lenders who would price their loans according to the risks involved.”

“But what’s good for taxpayers would have been bad for Realtors — at least in the short run. So, under strong lobbying, Congress rescinded the modest cut in FHA loan guarantees through at least 2013. As a result, federal dollars still will be used to back enormous loans.”

The Knoxville News Sentinel. “I’ve often joked that the National Association of Realtors (NAR) will twist, manipulate or interpret any data series to prove that now is a great time to buy a house. Or sell a house. Or they could simply report phony data.”

“It seems that the NAR has been reporting inflated house sales figures at least since 2007. CoreLogic, an independent real estate analysis firm, accused the NAR of releasing inflated sales data. NAR spokesman Walter Malony fessed up. ‘We’re capturing some new home data that should have been filtered out. All of the data since 2007 is being revised down. Sales were weaker than people thought.’”

“‘Sales were weaker than people thought?’ That makes it sound like it was the people’s fault, not the NAR.”

“The NAR expects the adjustments to be ‘relatively minor.’ However, CoreLogic says that just the California sales data alone could have been overstated by as much as 20 percent.”

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Readers suggested a topic on taking it to the streets. “Talk talk talk about how bad real estate is, about how anyone who bought during the boom was stupid, how the fundamentals demand a 50% price correction, and how this is certain, the only question is when. Do this over and over and over and over, to anyone within earshot. Get this buzz going so loudly that even the deaf MSM becomes aware of it. In other words, break the illusion that all is well and this is just a blip.”

“If you do this incessantly, and if after this you still want to buy something, prices should be within reason. But, you may have to be willing to continue to take losses for awhile, because prices will probably over-correct and if you buy on the way down, it may continue going down even lower than fundamentals suggest.”

A reply, “I’ve lost friends not because I’ve spoken out about housing but simply because they’ve been irked I haven’t bought yet. I started getting reports this summer about someone making snarky remarks to mutual friends and the thing is it wasn’t behind my back. They were just as eager to confront me head on as if it made any difference in their life. This was the million dollar home purchaser. She said they had to stretch to buy and yet she got very agitated that I was waiting.”

“In my circle, speaking out about the housing syndicate would be tantamount to taking all my clothes off and waving a flag on the steps of town hall. It couldn’t rid me of friends and associates fast enough.”

“What I’m saying is it’s not time yet. Not time at all. As long as central banks apply all the band-aids and paper clips to keep the Ponzi going, people just won’t allow themselves to focus on the full picture. Or maybe they sort of allow themselves to see it in the middle of the night but if everything they’ve got is riding on the game being true, they don’t want to hear anything to the contrary.”

Another said, “I’m thinking the real ‘oh sh%t’ moment won’t happen until 2015. This is far enough in the future to bankrupt many of today’s speculators counting on 2005 prices in 2015 to make their ‘investments’ whole. Around this time the truth should then be plainly visible that housing is not a real investment and should generally be a minimized expense. By then rational expectations should have taken hold that housing will either a) lose money, or b) stay roughly in line with inflation, some key locations being excepted.”

“All around I’m hearing talk about ‘it’s a great time to buy, etc.’ This kind of talk was also heard in 2009 and look what has largely happened since then. If this is a 9-inning ball game, we’re probably still in the top of the 4th.”

One had this, “The truth will be plainly visible that 1/3 of the population can’t retire and expect all current workers to pay for it when the jobs are gone. And voting ourselves benefits we don’t want to work for is a lame way to run a Country. I don’t talk about it much I don’t need any more weirdness after all I moved back to S. CA, although Phoenix was worse about buying not buying.”

“I think here in S. CA, they just think I’m poor. In Phoenix they were younger and dumber in general and needed the comfort of the herd all going down together. You don’t need friends like that.”

And finally, “I’ve been talking for about 7 years now. What if *I* still want to buy something?”

The Frederick News Post in Maryland. “Frederick County had 76 foreclosures in November, up from 55 in October and 52 in November 2010, according to RealtyTrac. Home sales in the county were 177 for November, down from 183 in October. More than 168 homes sold in November 2010. Gloria Castle, president of the Frederick County Association of Realtors, said via email that while local sales were down in November, only 40 percent were foreclosures. Castle also said the inventory of homes on the market was down in November from a year earlier.”

“That inventory, 1,054 in November, doesn’t include the ’shadow inventory’ of potentially distressed homes, said Buzz Mackintosh, co-owner of Mackintosh Inc. Realtors, via email. Mackintosh said Standard & Poor’s defines the shadow inventory as a property 90 days or more delinquent on mortgage payments, as well as those already in foreclosure or are already in the hands of the lender. ‘A lion’s share of that shadow inventory is most likely not in Frederick County, which would be good news for our local real estate market,’ Mackintosh said.”

The Desert Sun on California. “The number of scheduled trustee sales in California last month climbed 14 percent to 26,509, marking a 10-month high and helping the state maintain the second-highest foreclosure rate behind Nevada. Notices of trustee sales are the final step before homes with delinquent mortgages go to auction.”

“More than 5,300 new default notices were mailed to homeowners in the region in November, a 35 percent year-over-year increase. Not since November 2009 has the region seen a year-over-year increase in foreclosure activity, RealtyTrac reported. James Saccacio, RealtyTrac co-founder, said the ‘bellwether states’ of California, Arizona and Massachusetts all posted year- over-year increases in foreclosure activity.”

“Many real estate experts anticipated that filings would jump as lenders and mortgage servicers began ending the voluntary suspensions of foreclosure actions that they initiated in late 2010. Lenders that put temporary holds on foreclosure filings have been resolving problems with processing and paperwork, said Bret Cohn, senior VP with Franklin Loan Center in Palm Desert.”

“Other, seasonal factors likely contributed to November’s increase in foreclosure activity, said Jim Franklin, president of the Palm Springs Association of Realtors. ‘In November, lenders file more trustee sales notices so they’re ready to go in January,’ Franklin said. ‘I think the banks are more sensitive about not taking somebody’s house at Christmas.’”

The News Press in Florida. “The 20th Judicial Circuit in Lee County and other circuits across the state are in a tizzy over how to proceed in the wake of the Florida Supreme Court’s decision Monday to terminate the state’s mandatory foreclosure mediation program. ‘Literally everything across the state is upside down,’ said Jonathan D. Conant, president of the Conant Mediation Center, which manages the state program for the 20th Judicial Circuit, which covers Lee, Collier, Charlotte, Glades and Hendry counties.”

“The termination of the mandatory program comes on the heels of an October review of the program by an assessment work group created by the Supreme Court, recommending that the program be stopped. ‘It was the consensus of the work group that the emergency in residential mortgage foreclosure filings that occurred in 2008-09 continues to exist as an emergency in pending foreclosure cases,’ the report says. ‘There are now approximately 350,000 backlogged foreclosure cases in the circuit courts.’”

“There were 1,426 cases referred to Conant Mediation Center. Of those, the mediation center was able to contact 832 borrowers. ‘Others ignored us or thought we were bill collectors,’ Conant said.”

“Of those 832 borrowers, 337 cases were scheduled for mediation. Of those 337, a total of 269 actually took place. Of the 269 cases, 80 reached agreement.”

The Miami Herald in Florida. “‘I don’t think any real rebound is going to happen until at least 2013,’ said Jack McCabe, CEO of Deerfield Beach-based McCabe Research & Consulting. ‘Right now we have 371,000 open foreclosure files in Florida, and you have 800,000 mortgages that are 60 days late or in default. I don’t see the market rebounding for at least two years.’”

The Dover Post. “Delaware lawmakers passed a package of legislation in July that now requires for an automatic mediation program when a complaint for foreclosure is filed. Attorney General Beau Biden said it is imperative that discussions take place face-to-face between the lender and the borrower before the property is foreclosed upon. ‘This isn’t about someone getting away with not paying their mortgage,’ he said. ‘It brings the two parties together to discuss and set terms in which everyone is satisfied.’”

“Each of Delaware’s three county sheriffs are reporting an increase in sheriff sales for 2011, with a majority of those properties being mortgage sales. Both New Castle and Sussex counties saw an increase of more than 400 sales in 2011 compared to the previous year, and Kent County’s sales has nearly quadrupled since 2010. New Castle County Sheriff Trinidad Navarro said it is often hard to predict how many sheriff sales the county will process year to year.”

“‘We make projections based on historic numbers, but the numbers now are unprecedented,’ he said. ‘The reality is there’s still no end in sight.’”

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