March 28, 2017

The Flood Set To Hit The Market

A report from Bloomberg. “As members of Congress in Washington debate raising the minimum required to obtain a U.S. immigrant investor visa from $500,000 to $1.35 million, concern about the hike has set off a scramble among wealthy would-be participants in China. China’s wealthy, using not-always-legal means to skirt capital controls to get their money out and at the same time gain residency in the U.S., are continuing to dwarf all others as the largest participants in the EB-5 program, despite heightened measures by the Chinese government. The initiative channels money to high-profile U.S. real estate projects from New York to Miami to California.”

“New projects recently doing the rounds in China’s chat rooms, web forums and hotel-ballroom investor seminars include a 5-star hotel complex in Palm Springs, California, and what’s touted as ‘the world’s tallest residential building,’ on New York’s 57th Street, known as Billionaires’ Row. Because Chinese individuals are limited to exchanging $50,000 worth of yuan a year, a 10th of what the EB-5 program requires, some agents are advising clients who don’t already have assets offshore to use a means nicknamed ’smurfing’ to move their money.”

“‘Our suggestion to the client is to open three to four personal accounts in the U.S. or line up three to four friends’ accounts, so they can split the money and wire it to different personal accounts without being put on a blacklist by the Chinese authorities,’ said a Shanghai-based real estate agent who gave the surname Dong. ‘It may require a trip to the States to do so to facilitate the process.’”

The Sparks Tribune in Nevada. “The revitalization of the downtown Sparks area will take another step forward this week when crews break ground on another luxury apartment community on the northeast shore of the Sparks Marina. The five story, 209-unit Waterfront at the Marina surrounds and incorporates an abandoned parking structure that has been vacant since 2008. The Waterfront will have water and mountain views along with an assortment of one and two bedroom models featuring high end amenities including an art fitness center, concierge services, business center, dog wash and park, roof top deck and secure parking.”

“‘There is nothing like this project in Northern Nevada,’ said James Previti, CEO of Guardian Investment Capital. ‘Five story elevator buildings and a secured parking garage are extremely expensive to build, and impossible for others to replicate. It will be the premier, high end community in the area.’”

From Philadelphia Magazine in Pennsylvania. “Our apartment-building engine continues to chug along. Signs of activity recently sprouted on two more construction sites: Pearl Properties’ proposed 32-story apartment tower at 1910 Chestnut, and Southern Land Company’s high-rise at 1911 Walnut. The only problem? Finding enough people who want to live in them. Welcome to the world of ‘post-millennial’ real estate.”

“Real estate services firm JLL noted that the flow of young professionals to Philly has already slowed — a problem when you consider the flood of apartments set to hit the market. In fact, a recent Center City District report says 4,167 apartments are under construction — more than double the 1,833 that came on the market in 2016. What’s more, 75 percent of these units are set to come on line this year — three times as many as the annual average since 2010. There’s a hope that If you build it, they will come — but what happens if they don’t? ”

The Grand Forks herald in North Dakota. “The Greater Grand Forks Apartment Association biannual vacancy survey released last week showed vacancies in the city are at the highest level they’ve been since February 2011, at 9.38 percent. ‘The market is turning into a renter’s market as opposed to a landlord’s market,’ said John Colter, executive director of the association.”

“With a complex market such as housing, it’s difficult to boil an outcome down to any one cause. But Colter speculates the record-high vacancy rates are tied to the large number of apartment developments springing up in Grand Forks over the past few years. Terry Hanson, executive director of the Grand Forks Housing Authority, said Grand Forks is at the higher end of the healthy vacancy rate. The rates as they are now, he said, will put downward pressure on the sky-high rents in town. Hanson said the rapid building of apartment projects was ultimately leading to this point. ‘It’s time to sit back and absorb what we have,’ he said.”

The Real Deal on Florida. “In the latest barrage to sell preconstruction units in a sluggish condo market, the Related Group is offering a slew of incentives at its Paraiso complex in Miami’s Edgewater neighborhood, The Real Deal has learned. The email also offers 30 percent deposits, rather than the usual 50 percent, which has been the standard among new condo developments this cycle. Commissions at Paraiso were already raised to 8 percent to 10 percent, depending on the tower, far above the original 5 percent.”

“Greater Downtown Miami, including Edgewater, currently has 21 towers under construction with 7,077 units. An additional 3,666 condos are currently on the market, representing resales, equating to 29 months of supply, according to Peter Zalewski, principal of Cranespotters. ‘A developer does not want to cut pricing, so what a developer will do first is raise commissions for brokers; second, eliminate or offer free maintenance; third is provide an incentive or credit for buildout of units; and the final step is reduce prices,’ Zalewski said. ‘So we are about halfway through the process when you have too many units and not enough buyers.’”

From Urban CNY in New York. “All you need to do is take a ride through various sections of our city and see construction. Not the typical Family Dollar, Dunkin Donuts, or Cell phone store, which has been our primary source of growth in neighborhoods, this is a housing boom. The most dramatic change came with the completion of Syracuse University’s Connective Corridor. Buildings are being converted into high-end residential as quickly as they can be acquired.”

“Buildings many of us have known for years as locations for business or industrial occupancy are now being transformed into glistening condominiums and apartments, towering over the crumbling infrastructure below. Massive apartment complexes have sprung up seemingly overnight. Miles away from campus, there are even more apartments and condominiums newly opened or under development.”

“Once these multiple projects are fully functional there could be a housing glut in the Syracuse area. Older rental units, more costly to operate housing will start to vacate, first to empty will be the uninsulated, poorly maintained rentals. Due to competition from the various housing options now available, university area property owners will no longer get top dollar for their older dwellings.”

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Comment by Senior Housing Analyst
2017-03-28 09:55:13

Deer Park, TX Housing Prices Crater 9% YoY

Comment by palmetto
2017-03-28 10:16:01

“a Shanghai-based real estate agent who gave the surname Dong.”

I’m feeling especially juvenile today.

Comment by palmetto
2017-03-28 10:58:01

I just had a brainstorm. Where’s the guy who was looking to make some money off the market? I’ll bet you could get a grant from the Ford Foundation, Rockefeller Foundation, Soros funded foundations, etc. to have the word “dong” eliminated from the English language in the interest of multiculturalism. Out of respect for the Chinese, “dong” may only be recognized as a last name. This means editing Beavis and Butthead, wiping out any references to the term on the internet, including the Long Dong Silver comments during the Clarence Thomas confirmation hearings, and expunging “Ding-Dong the Witch is Dead” from the Wizard of Oz.

The possibilities are endless.

Comment by sacks of gold men
2017-03-28 23:13:29

Dead Dong in Vietnam: Starbucks oversteps its property line. The Big Swinging Dong (BSD) rectifies the situation. I don’t understand why people patronize Starbucks anyway, as Vietnamese coffee is the best in the world, imho.

Notice the motorbike parking in the first picture. We have to walk in the street a lot of the time. But in a nationwide crackdown of sidewalk encroachment, the BSD is in full swing here. Nobody messes with him. Property owners were warned and now they must pay for the demolition:

Comment by palmetto
2017-03-28 10:17:56

“‘There is nothing like this project in Northern Nevada,’ said James Previti, CEO of Guardian Investment Capital. ‘Five story elevator buildings and a secured parking garage are extremely expensive to build, and impossible for others to replicate. It will be the premier, high end community in the area.’”

Paging Mr. Dong, Mr. Dong, Mr. Dong!

Comment by new attitiude
2017-03-28 10:34:11

premier, high end

in Sparks!!! Used heroin needles at no extra charge.
Don’t worry I hear Tesla is going to hire everyone for >$50k a yr!!

Reno/Sparks is a wasteland.

Comment by Ben Jones
2017-03-28 11:54:12

A Tesla on auto-pilot hit a police motorcycle in Arizona today. I read their sales missed targets again. A self driving Uber flipped in Chandler the other day. I’m still waiting on the paperless office.

Comment by oxide
2017-03-29 07:36:27

‘Five story elevator buildings and a secured parking garage are extremely expensive to build, and impossible for others to replicate

Isn’t this almost exactly what you filmed in rainy Houston, Ben? Evidently premier high end isn’t so impossible to replicate after all.

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Comment by Ben Jones
2017-03-29 07:44:14

That’s what they are throwing up everywhere in Texas. Three story or four. Towers too, 30 or 40 floors. I just don’t see it working out in the long run. One “luxury” complex in Odessa had gone to seed and the parking lot was full of beaters and trash.

Comment by Rental Watch
2017-03-29 10:15:48

I think self-driving cars is somewhat of a race to land a man on the moon. There are a lot of companies investing in the technology…I think eventually they’ll get it right…however, I’m not sure how long it will take for people to accept allowing a car to drive them around.

These reports show how ridiculously far ahead Google is in the self-driving car arena. The reports show how many miles are driven, and how many times a car needed to have its driver “disengage” the system (for various reasons).

Not in this, but Uber recently reported about one driver disengagement per mile. Apparently the guy that founded Otto (purchased by Uber) hated the part of Google’s efforts related to all the small details (how to react if a ball rolls in front of the car, etc.). It shows in how their cars are performing.

Tesla reported approximately one driver disengagement per about 3 miles.

Google reported one driver disengagement every 5,100 miles in 2016. This is up from one driver disengagement every 1,200 miles in 2015.

There is certainly a meaningful probability (way over 25%) that the projected timelines to get to full and safe autonomous driving is far too aggressive, and we’ll be having this same discussion 5 years from now as I type on a desk in a “paperless office” that is stacked high with paper.

But for now, I remain optimistic, given the benefits that self-driving cars could bring.

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Comment by PitchforkPurveyor
2017-03-29 13:42:19

I don’t think self-driving cars can ever be perfected. The human brain can instantly detect the difference between a rolling ball and a baby. A computer never could.

Comment by Rental Watch
2017-03-29 15:27:28

A computer never could.

“Never” is an awfully long time.

As of right now, I’m willing to wager that Google’s self-driving car is safer than a non-trivial number number of licensed drivers in the US–and that number is going up for two reasons.

1) Google’s technology is getting better, and
2) The population is aging.

Comment by Taxpayers
2017-03-28 19:00:47

Grand forks
Is that downtown grand forks ?

Turnover good here as the tornado spins

Comment by Rental Watch
2017-03-29 10:25:05

The job growth projections for Reno are eye popping. If they are only half right, there will be a lot of new jobs relative to a market of Reno’s size:

Now, “luxury”? Nope.

Comment by aqius
2017-03-28 22:24:00

the donger is still out w/grandpas car.

Comment by Ben Jones
2017-03-28 10:18:57

‘The initiative channels money to high-profile U.S. real estate projects from New York to Miami to California’

And everywhere in between. Combined with the yield chasing pension funds and life insurance companies, it becomes clearer every day that what was driving this wasn’t demand, but too much money sloshing around. The PA article has an apartment guy saying “the money spigot was wide open” in 2013.

Comment by Jingle Male
2017-03-29 03:20:04

One of the problems with EB-5 money is the advance rates on projects they fund. Facilitators bundle the $500,000 investors together (soon to be $1.3 million?) and provide 85% to 90% financing for commercial projects. When the money is to be paid back in 5-years, the borrowers suddenly realize there is no source of refinancing available to replace the high LTV EB-5 loan. Most commercial lenders cut off at 65% to 75% LTV, so unless the developer/borrower has created value or can add capital, they are stuck being over financed with no exit (Get Stucco).

Oh, and the facilitators charge 5 points for placing the money….on a $10,000,000 loan (=20 investors), $500,000 is eaten up in fees before the project sees the remaining $9,500,000. Repayment is a b!tch.

Comment by Rental Watch
2017-03-29 10:37:33

That’s actually not the problem…the EB-5 money is often cheaper than debt, can be treated as equity, and is required to be a long-term investment by law.

As an experienced EB-5 attorney told me when we were exploring having some EB-5 money as part of a project…this is not an investment program…this is an immigration program. Financial returns are a distant second to getting a green card cleanly.

Accordingly, the big problem is that 1) for a project to qualify for EB-5 money, it needs to have been determined to create a certain number of jobs, usually this means projects that have employees, like hotels, not just construction jobs; and 2) the money needs to stay invested in the project for a certain length of time (I believe it’s at least 5 years effectively).

The issue with #1 is that it limits the universe of projects for which EB-5 money works.

The issue with #2 is that often times there are other, domestic investors in the project, that have different goals (profit at the least risk). The inclusion of EB-5 money eliminates the possibility of selling the asset for AT LEAST 5 years, and likely longer. Most groups, while they may not plan to sell for at least that timeframe initially, don’t want to give up their flexibility to change their mind and sell early.

And if you screw up their immigration effort because you forced a sale early, it is likely that at least one person in the EB-5 pool on the other end has lots of resources to sue you to the ends of the earth because you messed up their ability to “buy” a US Green Card for their kids.

No thank you.

Comment by palmetto
2017-03-28 10:20:24

‘A developer does not want to cut pricing, so what a developer will do first is raise commissions for brokers; second, eliminate or offer free maintenance; third is provide an incentive or credit for buildout of units; and the final step is reduce prices,’ Zalewski said. ‘So we are about halfway through the process when you have too many units and not enough buyers.’”

About that free maintenenance: you get what you pay for.

Comment by oxide
2017-03-28 19:31:28

Of all the amenities, one would think that the free maintenance is the one that the absentee buyer would need the most.

Comment by SJ
2017-03-28 11:03:40

I still do not see ANY properties for sale on west coast yet for 100k.

Comment by palmetto
2017-03-28 11:11:53

If you’re looking on Zillow or, of course you won’t see any. Not even on Craigslist.

But they’re out there. It’s just that you aren’t in the club that gets to hear about it.

It’s interesting, I was looking at recently sold properties on the local Imagine my surprise when a couple of properties showed up sold in the $40-50,000 range. Why, gol ding it, I never saw those listed. Gee, I wonder why?

Similar properties sold retail for $110,000+

Comment by Race Bannon
2017-03-28 11:54:25

“a couple of properties showed up sold in the $40-50,000 range.”

And generally that’s about all a used house is worth. It’s one of those things most just can’t wrap their mind around.

Comment by oxide
2017-03-28 14:58:29

Angelbaby, you missed it. To find the proper mockingprice for used houses, you should have revisited the previous thread and jumped on those $6K houses in Cleveland and Muncie.

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Comment by Race Bannon
2017-03-28 15:09:04

Hey Donk.

Concord, MA Housing Prices Crater 11% YoY

Comment by palmetto
2017-03-28 15:55:21

Interesting thing about those houses. Similar ones (or I should say, comparable) in places like Hendersonville NC go under contract as soon as they come on the market, for much higher prices.

There’s an opportunity here, I think, for urban homesteading, but I’m guessing people would have to be armed to the teeth in some of the neighborhoods.

This is an interesting video shot in Gary, Indiana. Urban Exploration in the American Wasteland

I like this Tim Pool guy, another young citizen journalist. Some of these young people are fearless and not afraid to come out of their “safe space”. In fact I’d say the idea of a “safe space” is anathema to them. They’ve been inspired by people like PJW and James O’Keefe.

Comment by oxide
2017-03-28 18:05:14

There’s a huge opportunity for urban homesteading, but I suspect it’s not going to be the Mother Earth News crowd, oh they of the pretty pictures. Those idiots would probably order luxe chicken coops with amenities like stainless steel caging, pergo nesting boxes, and fox-grooming parlor if they were told it was environmentally friendly. Nope, it will probably be a couple of Chinese families who smurf out the money to buy a city block of these decrepit housing and invite a few families of illegals to rent the other houses cheap and farm the place. We’ll look like Bangladesh in no time!

Yup, and I’ve seen Tim Pool’s reports from Malmo. Honestly his technical journalism skillz are lacking but I won’t deny his courage and spirit. After all, at least he’s out in the field and not in front of a map like ♥PJW♥.

Comment by palmetto
2017-03-28 19:20:57

“After all, at least he’s out in the field and not in front of a map like ♥PJW♥.”

In all fairness to PJW, he came up the ranks doing stuff in the field just like Pool. And because he had those innocent boyish good looks, he could often get into places and around people who didn’t pay him much mind, they thought he was just some wide-eyed kid and thus he gained a reputation for being a good investigative journalist. Now he’s happy to sit in front of map and editorialize, because he sure paid his dues in the field.

Comment by Senior Housing Analyst
2017-03-28 11:07:01

Scarsdale, NY Housing Prices Crater 9% YoY

Comment by nolookpass13
2017-03-28 12:38:02

“dog wash and park”

Throw in discount grooming and I’d be on it like white on rice.

Comment by ZH
2017-03-28 13:06:18
Comment by palmetto
2017-03-28 13:50:12

This was my fave ZH story today:

Like one commenter said, how’re those H1B’s working out for ya, Ray?

LOL, the guy emailed the documents from his work account to his personal account. Dumb as a box of rocks, but I guess the chance to sell a little information to the body-shops in Bangalore was too much of a temptation to pass up.

I hope they eff up Disney but good.

Comment by new attitiude
2017-03-28 13:17:29

I am just excited the coal mining will soon be popular again!

Comment by palmetto
Comment by Avg Joe
Comment by new attitiude
2017-03-28 14:51:12

wind power is scary and so liberal, it kills birds!

Comment by Ben Jones
2017-03-28 15:14:08


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Comment by oxide
2017-03-28 15:27:12
Comment by FreshWasabi
2017-03-28 15:31:28


We can sell our coal to China - they like it very much. Funny how they buy our coal, and we buy their solar panels.

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Comment by Race Bannon
2017-03-28 15:47:00

Falling oil prices my friend….. falling prices to dramatically lower and more affordable levels accelerating the economy and creating jobs like only falling prices can do.

“Oil Prices Fell Due To Weakening Demand”

Comment by new attitiude
2017-03-28 18:33:13

“Oil Prices Fell Due To Weakening Demand”

keep buying those LED bulbs and insulate your shack! Soon we wont need wars for oil!

Comment by Ben Jones
2017-03-28 18:53:21

That butt hurt creme I recommended is high SPF too.

Comment by phony scandals
2017-03-29 06:52:55

“keep buying those LED bulbs and insulate your shack!”

Better yet, load up on CFLs!

According to Earth911 and their Tree Hugger Consultant a little mercury exposure is just about good for your family every once in a while.


Compact fluorescent light bulbs (CFLs) use 75 percent less energy than traditional incandescent bulbs and last about six times longer, but it’s no secret that CFLs contain a small amount of mercury (about 4 milligrams per bulb on average).

Any level of mercury exposure carries potential health concerns, but due to the small amount of mercury and short duration of exposure, a broken CFL is not likely to present any significant risk to you or your family, Rogers told Earth911.

Comment by phony scandals
2017-03-29 07:20:36

1,000 CFL light bulbs with mercury crushed, dumped on Dallas playground

Friday, October 11, 2013 by: Jonathan Benson, staff writer

Mercury-laden CFL bulbs are a ticking time bomb

The fact that 1,000 illegally dumped CFL light bulbs has created such an uproar says a lot about the true toxicity of mercury. And yet CFL bulbs are still being fraudulently marketed as some kind of panacea for cleaning up the environment and stopping global warming. Nothing could be further from the truth, and with millions of CFL bulbs now installed and in use in homes and businesses across America, it is only a matter of time before the situation becomes a whole lot worse on a massive scale.

Comment by MightyMike
2017-03-29 08:50:33

Mercury is one of the emissions produced when coal is burned.

Report: U.S. coal power plants emit toxic air pollutants

Comment by new attitiude
2017-03-29 10:05:57

Dont worry, when China burns our coal, the dirty air stays in China.

Comment by phony scandals
2017-03-29 12:37:36

“Mercury is one of the emissions produced when coal is burned.”

Then by all means feel free to fertilize your lawns with CFL light bulbs.

Comment by redmondjp
2017-03-28 20:29:12

The thing is, it really does (kill birds). My friend works on a wind farm. But that’s the least of it. I hear the maintenance horror stories every single week. My confidence level about most of today’s wind turbines still being operational 20 years from now: 20%.

They are literally running them into the ground. The companies that have the maintenance contracts don’t make more profits by fixing things, they make more profits by running them until their contract is up, doing the least amount of work possible in the mean time. Kicking the can is the order of the day.

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Comment by Blue Skye
2017-03-29 04:13:33

When the only profit to be made is in the government subsidy, you only get what you subsidize. Maintenance isn’t subsidized.

We learned this in the 70s with wind turbines.

Comment by new attitiude
2017-03-28 13:34:41

Are they building these “lux apts” for boomers? Who aspires to apt living?

Comment by Race Bannon
2017-03-28 13:49:12

With 10,000 boomers a day hitting the funeral home, they’re better off building coffins.

Comment by new attitiude
2017-03-28 14:15:06

Hey Rac- how is the ice?

Stock in funeral homes?

Comment by Race Bannon
2017-03-28 15:00:18

You need to lay off the ice and get yourself together NattyIceBoi.

Santa Monica, CA Housing Prices Crater 6% YOY

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Comment by Jingle Male
2017-03-29 03:34:23

Wow, 700 SF apartments for $5,000/month.

1,500 SF homes for $1,400,000.

That does seem a bit out of balance.

Comment by palmetto
2017-03-28 18:06:33

Along the lines of those really cheap homes in Detroit, Indiana and Cleveland, here’s Roanoke, VA listings from about ten to sixty grand. Some of them are in pretty rough shape, it’s interesting to look at those that do have photos. Most of them are described as great investment opportunities. I don’t know the area at all, so I’m clueless about the neighborhoods, I just picked it out because a guy I know does a seasonal business up there.

Comment by Jingle Male
2017-03-29 03:37:52

Wow, 1,700 SF house for $10,600 in Roanoke. If only they could move it to Santa Monica…..

That does seem a bit out of balance. Oh, I already said that above about Santa Monica. I guess all real estate is local…

Comment by phony scandals
2017-03-29 07:51:00

I’d spend the extra money and go with the $56,900 house at 7306 Apple Grove Ln.

You may have neighbors with their Christmas lights up all year long but the front porch of that $10,600 house looks like a drive-by shooting investigation waiting to happen.

Comment by palmetto
2017-03-29 09:54:07

Lol on the Christmas lights.

My point in posting those listings was to demonstrate that there are some relatively cheap houses out there in halfway decent pockets all around the country, that aren’t in Gary, Chicago, Cleveland or Detroit. You could probably do this with a number of areas where you could survive quite nicely, although you’d have to be handy with a hammer and nail. Some of those homes look like they have good “bones”, compared to a lot of what’s going up these days.

Neighborhoods is another matter, although websites like city data might have posters who would be able to give you some preliminary info on neighborhoods. But again, you’d run into subjective views. The Western North Carolina forum has a couple of regular posters who tell everyone they’re not going to find anything decent for under $200,000 and that’s cutting it close.

Well, “decent” is a matter of debate. In doing a property search of the area surrounding Asheville, NC, I found a number of properties under $200,000 that looked OK to me. And apparently people agree with me because most have a contract pending right now, or so says I personally don’t care about granite countertops or fancy flooring or having a pool or being in a gated community.

With that said, under $200,000 there’s a lot of “panic buying” at the lower end, and many of these are modest homes that should be in the $50,000 to $90,000 range IMO, and yet they’re going for $100,000 to $175,000.00. The Hendersonville NC area is attracting a lot of halfbacks who found Florida too hot for year round living.

At this time, Roanoke is certainly no Asheville, but from where I sit it looks like a relatively pleasant area with a moderate seasonal climate and some sort of an economy. The only thing that gives me pause is the fact that it appears to be Democrat controlled at this time, which usually means tax hikes. But you can get around that by living outside of city limits.

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Comment by oxide
2017-03-29 11:19:19

Heh, you guys are fantasizing about Oil City. I love it.

Not sure if you’re being sarcastic about the Apple Grove Lane house. You could easily blow $100K fixing up both of the houses, but it’s on almost an acre, and if done right it would be worthy of a Thomas Kinkade painting. I’m surprised that the Chinese aren’t buying this up. My only worry would be that creek out back could flood the place at high water.

By the way, Virginia Tech University is based in Blacksburg, which is 25 miles away from Roanoke. Roanoke has the airport. So if you have a couple, say a school teacher and a baggage handler, they could do pretty well in Roanoke.

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Comment by Rental Watch
2017-03-29 12:29:23

My brother lives close to VT. He had noted over time that townhome investments near the university seemed to pay good rent for the cost of the townhomes, but he never found one to buy.

Post-crash, he bought one beaten up home, fixed it up and rented it out. He wanted to buy more given the returns he could get (seemed very high at the time), but I don’t think he ever found a second.

Overall, it’s not a bad place to live. He moved there from CA 15+ years ago, and despite occasionally entertaining job offers back in CA (closer to family), I’m convinced that he’s not coming back. In fact, some members of his wife’s family have moved to them…and more are considering it.

Comment by Crow Breath
2017-03-28 18:11:05

Slightly off topic, but here’s a one today from bloomberg about the “deep subprime” auto loan growth in recent years, and deteriorating conditions.

““Many of the subprime customers from 2015 to the present have a sustained history of late payments or charge-offs,” S&P wrote. “Stated slightly different, today’s subprime customer appears to be a weaker cohort than that of several years ago.”"

Comment by oxide
2017-03-28 19:54:01

My neighborhood is about 85% beaters and 15% macho trucks. Funny the macho trucks don’t seem to stick around longer than a couple months — probably being repo’d.

Comment by new attitiude
2017-03-29 10:08:13

Oxide - Are you in Tuscon?

Comment by PitchforkPurveyor
2017-03-29 15:34:07

You must be in a tough neighborhood, huh?

Comment by Tony A. Clymer
2017-03-29 05:37:29

Two things: Developers are going to have to lower prices or the condo market will bust, prices are set WAY too much per sf compared to just last year and two, I disagree with you when you state that there are not enough buyers in the market. The problem is the prices are TOO HIGH and reduced deposits, buildout credits and free maintenance will not get around that fact; there are buyers, they are just smart and are not about to pay a premium when they do not have to. Shame on the banks who lend money to developers to continue this market saturation.

Comment by azdude
2017-03-29 06:33:21

“So much flip-flopping from Dennis Gartman in just the past week, it is enough to make one’s head spin.

After missing Friday’s move lower, on Monday morning Gartman said he was actively looking to “re-establish net short positions” when S&P futures were sharply lower to which we said “at the rate the S&P is covering its opening losses, he should be able “find a point” where the S&P turns green, and “reestablish shorts” on very short notice.” Indeed, in just a few hours the S&P covered its entire move lower, and provided Gartman with ample opportunity to become short again. Of course, the very next day, US equity markets soared allegedly on the best consumer confidence print since 2000, and following the biggest two day drop in the VIX in years. ”

This douchbag changes his mind weekly, sometimes daily, about stocks.

This guy is an expert shrill on CNBC cause his daughter works there. I love reading the comments about him.

Comment by PoohEmoji
2017-03-29 07:40:10

There’s that word shortage again…

Buoyant Consumers Chase Home Prices Higher

Home prices in the U.S. rose at their fastest rate in nearly three years in January, driven by job growth, a large demographic of aspiring new owners and a shortage of homes on the market. Inventories of homes on the market are still close to an 18-year low, down 6.4% in February. At a 5.9% clip, prices are rising more than twice as fast as wages, a trend that will be hard to sustain in the long run, but with consumer confidence at its highest in 16 years, the housing market looks pretty well set for the immediate future.

WSJ, subscription required

Comment by azdude
2017-03-29 07:49:36

buy a home, get rich!

Comment by new attitiude
2017-03-29 10:06:58

I did, 3 times, I am … now, where do I put all my money??

Comment by Rental Watch
2017-03-29 10:45:41

” Inventory in December hit its lowest level since 1999, when the National Association of Realtors started tracking the data.”

NAR is the source…problem #1.
They track “inventory”, not shelter (supply) compared to the number of people seeking it (demand)…problem #2.

That said, less inventory is a symptom of there not being enough shelter relative to the number of people who want to live in it.

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