A Year Without The Frenzy Seen In The Prior Several
A report from KPBS News in California. “The number of building permits issued in San Diego County in the first quarter of this year could suggest a slowdown in construction of new homes. The head of San Diego’s Building Industry Association, Borre WInckel said 1,409 building permits were issued in the first three months of 2017 in San Diego. If you multiply that by four, a total of 5,636 new permits would be issued this year, considerably fewer than the 10,000 issued last year. Winckel said developers can not make middle class housing pencil out because of the high cost of government regulation, and voter resistance to new development. He said the high-end of the housing market is saturated and workforce housing is stagnant.”
“That’s the new name for middle-class housing, is ‘workforce housing,’ he said. ‘That in essence has stopped, so if we don’t figure it out how to re-energize the supply of workforce housing, this area’s in trouble.’”
The Arizona Republic. “The popular mortgage-deduction tax break isn’t being cut under President Donald Trump’s plan to overhaul the tax system. That seems like a very good thing for homeowners and the housing industry. But the nation’s biggest real-estate groups aren’t celebrating. Proposed tax changes under the new plan, especially doubling the standard deduction, will lead to fewer people buying homes to tap the mortgage deduction, according to the National Association of Realtors and the National Association of Home Builders.”
“When a housing advocate group talks about falling home prices, many of us get a little alarmed. Particularly because as Arizona Association of Realtors CEO Michelle Lind told me, ‘Arizona’s real-estate market has recently recovered from falling home prices, and we do not want to see home values tumble again due to a tax plan that eliminates the tax benefits of homeownership.’”
From Curbed New York. “It’s a new year, which means it’s time to look at the slew of market reports from the last quarter of 2016, offering a few hints of what’s ahead for New York’s often unpredictable real estate market in 2017. Among those things: a continued slog for ultra luxury apartments, the end of aspirational pricing, and fewer bidding wars.”
“The Douglas Elliman report reveals the Manhattan sales market ’showed a continued easing of conditions,’ according to numbers wiz Jonathan Miller, meaning we are ‘capping off a year without the frenzy seen in the prior several.’”
“One big issue was the sharp decline of bidding wars: the market share of folks fighting over pricey pads fell by more than half, to the lowest level in four years. While 12.9 percent of inventory in the overall market saw bidding wars, the luxury market share of bidding wars was just two percent while new development was zero percent. Because of that, sellers started pulling overpriced properties off the market. As Miller puts it, ‘Listings are falling in the luxury market, the weakest segment, so overpriced ‘aspirationally’ priced listings are falling out of the market.’”
The Miami Herald. “You probably have strong beliefs about abortion, police brutality or immigration. Would you change those beliefs if presented with inarguable, factual information that contradicts them? You likely want to say yes, but in reality the answer for most people is no. A comic by Matthew Inman, better known as The Oatmeal, depicts this phenomenon called the backfire effect, a psychological behavior that involves not only rejecting information that challenge our core beliefs, but actually letting that information further entrench us in the beliefs we already hold.”
“The comic explains the science behind the effect, citing studies of the brain that showed it reacts to intellectual threats the same way it reacts to physical threats. If a belief is a major part of your worldview, and a new piece of information doesn’t fit in with your worldview, your brain protects you by rejecting the new information. ‘Just remember that your worldview isn’t a perfect house that was built to last forever,’ Inman wrote. ‘It’s a cheap condo, and over time most of it will turn to s—.’”
From WTVF in Tennessee. “A TV news crew went to investigate a man accused of moving into a home he did not own. The man came back at the crew with an axe. A bank has promised to evict a squatter from a Mt. Juliet, Tennessee home following an investigation by Nashville-based WTVF. The investigation found that Jude Pischke moved into the home more than two years ago, despite having no legal claim to the property. The banks that had foreclosed on the previous owners essentially forgot about it, allowing it to sit empty for years.”
“Attempts to sell the luxury log cabin were unsuccessful for years because of confusion among banks after the housing crisis. In late 2012 JP Morgan/Chase foreclosed on the home and sold it to Bank of New York Mellon, as trustees for investors in mortgage a backed security. Control over the home has since passed from Countrywide Financial — to Bank of America — and finally to NationStar. Meanwhile it has sat empty.”
“Mt. Juliet City Commissioner Ray Justice contacted more than one bank about the abandoned home, but they didn’t seem to care. ‘We could not get in touch with anybody that would claim responsibility for the maintenance or the ownership or anything else,’ Justice said.”
“NationStar Bank finally sent us a statement saying ‘We greatly appreciate that you brought this to our attention.’ The statement went on to say ‘We are moving quickly to evict the home of its current residents so the home can be prepared for sale.’”
“But when WTVF approached Pischke he made it clear he was not interested in talking about the property. As Pischke walked to his truck he pulled out an axe. ‘I’m dealing with the bank, but let me see what would you like me to get you with? This will probably f****** work won’t it. Get the f*** out of here!’ Pischke said as he charged at the WTVF crew with the axe.”
“Pischke swung the axe and said, ‘Cut off your foot.’ WTVF crew members were not hurt, but police arrested Pischke and charged him with three counts of aggravated assault. He bonded out, and still lives in the house.”
‘He said the high-end of the housing market is saturated’
Check out this graphic from the link:
https://kpbs.media.clients.ellingtoncms.com/img/photos/2017/04/27/CIRB_Permit_Data_thru_3.2017_Valone_t700.jpg?f40c0e74b997dbb01ce524758e0d04a31382c8af
I would have expected more permits. It looks like the quantity is down significantly from the early 2000’s.
158 Communities
https://www.newhomesource.com/communityresults/california/san-diego-area
When I search for “quick move-in”:
27 Communities
Why would a homeowner care about the mortgage interest deduction? True homeowners have a clear deed and thus, don’t have a mortgage and nothing to deduct.
You aren’t a homeowner if you have a mortgage, you are a renter and your landlord is the bank.
Precisely.
Remember…… If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.
‘That’s the new name for middle-class housing, is ‘workforce housing,’ he said. ‘That in essence has stopped, so if we don’t figure it out how to re-energize the supply of workforce housing, this area’s in trouble.’
This is touching, Shack Building Dude is concerned about the workers. But what’s this?
‘Proposed tax changes under the new plan, especially doubling the standard deduction, will lead to fewer people buying homes to tap the mortgage deduction, according to the National Association of Realtors and the National Association of Home Builders.’
‘When a housing advocate group talks about falling home prices, many of us get a little alarmed. Particularly because as Arizona Association of Realtors CEO Michelle Lind told me, ‘Arizona’s real-estate market has recently recovered from falling home prices, and we do not want to see home values tumble again due to a tax plan that eliminates the tax benefits of homeownership.’
The same goes for the “we need to build more so prices fall” crowd. They don’t really want prices to fall, not even a smidgen. They will fight tooth and nail, pull every stunt to push demand and stifle supply.
‘Proposed tax changes under the new plan, especially doubling the standard deduction, will lead to fewer people buying homes to tap the mortgage deduction, according to the National Association of Realtors and the National Association of Home Builders.’
Houses are to live in. Not to tap a flimsy marginal tax deduction.
Do these two corrupt, criminal organizations ever proof before releasing these stupid statements?
Hmm, most of this is just unintended consequences.
“we do not want to see home values tumble again due to a tax plan that eliminates the tax benefits of homeownership.”
So he basically wants people to be penalized for not buying a house so he can make a commis. Scumbag.
“Arizona Association of Realtors CEO Michelle Lind told me…the tax benefits of homeownership.’”
She’s a liar. The tax benefit is for mortgage debt interest payers, not home ownership.
So if I owe only $5,000 on a house worth $500,000, I am just a renter, paying rent to the bank, and no different than the guy across the street who rents and has no equity? Even though I could sell and rent and have a half million dollars in my bank account? I don’t get it.
I suppose so. If paying a bank $1.5 million to net $500k is your idea of equity.
We need Donk Craterton to weigh in on this one.
All that matters is the size of your bank account the day you buy the house and the size the day you sell. We all have to live somewhere. NET/NET/NET
Speaking of hypothetical anonymous internet rich people…
DebtDonkeys don’t have bank accounts.
“Speaking of hypothetical anonymous internet rich people…”
WEHT, Bill in LA?
Natty Ice Dude’s house and rental property empire http://www.bandofriders.net/forums/showthread.php?t=10196
I’ve taken the MID in the past because it would have been silly not to have. However, I would rather they ditch all deductions and go to a flat tax that EVERYONE pays lowering the tax rate for all, and putting some skin in the game for those who haven’t paid in.
I’ll back that. Bigly!
During my debt years I never once qualified for the mortgage interest deduction nor the student loan interest deduction because I wasn’t that deep in either debt; the standard deduction was always better in my case according to TurboTax.
Newsflash: nobody’s a homeowner so long as the albatross of Property Taxes lingers over yer head. That’s the wild card right there.
Anybody can construct a housing bubble winning scenario. Here’s one: “I bought in year blah and sold in year blah-blah, rented for a couple blahs and bought three more shacks and I am sitting on a huge pile of sweet equity!” Signed, anonymous uncheck-able internet guy.
True. He probably leases his cars and owns a timeshare. Essentially undoing his Einstein housing moves.
He bought three weeks on that timeshare and intends to rake in the dough selling two of them. Really has them bent over the barrel on that one.
https://www.youtube.com/watch?v=YB1NCuvYPpM
But he drives a late model Beamer while others drive a Toyota beater!
First ya double the standard deduction, then you pull the mortgage int deduction. Less of a hit as most middle-class couples have a mortgage under $2000. I like it.
Without the MID people won’t able to deduct their property taxes, state income taxes, etc. If the new SD is large enough it won’t matter, but if it just covers the interest they could end up with a larger tax bill.
I really doubt they will touch the MID. Time will tell.
Raising the standard deduction puts a knife in the MID…. it doesn’t make sense for most debtors right now…. Raise the standard deduction in a big way and it makes sense for even fewer people.
Planned obsolescence my friend… Planned obsolescence
Like I said, it depends how big they make the SD. I’m not holding my breath.
Adjusted for inflation for a family.
The SD should be $90,000+
https://en.m.wikipedia.org/wiki/Revenue_Act_of_1913
I can create a clear mental model for this:
Is sum_deduction_standard > sum_deduction_itemized ?
• The MID increases sum_deduction_itemized, often leading to sum_deduction_itemized > sum_deduction_standard
• However, it’s less likely that sum_deduction_itemized > (2 x sum_deduction_standard).
In years past, with Turbo Tax, it would recommend I take the standard deduction in order to minimize my tax bill (i.e. it determined sum_deduction_standard > sum_deduction_itemized)
Recently, with my business growing, it started suggesting I itemize, in order to minimize my tax bill (i.e. it determined sum_deduction_itemized > sum_deduction_standard)
If they double the standard deduction, it will make sense for a lot of people to take the standard deduction, as the sum of their itemized deductions will be less than the standard deduction: sum_deduction_standard > sum_deduction_itemized
MID increases the amount you can deduct, oftentimes leading to sum_deductions_itemized > sum_deductions_stanard
So - they don’t have to touch the MID. People will massive mortgages will still be paying more interest than the standard deductions, leading them to itemize. However, it will cut those who don’t have mortgages (e.g. renters), or those with more modest mortgages, a break. It will make sum_deductions_standard > sum_deductions_itemized true for more people, but won’t harm those with mortgages in any way.
It will however blunt the sales pitch. It will actually help those late in their mortgages, paying a lot of principal and less interest. But for the sin of blunting the sales pitch, the NAR may veto it.
I think I fall into a small camp where I’ll lose a little by the doubling of the standard deduction.
Currently I’m able to itemize state income taxes, real estate taxes, mortgage interest, and charitable contributions and it adds up to a little more than double the current standard deduction.
If any of those deductions are dis-allowed going forward (especially state income tax and real estate tax), it would be difficult for me to reach the threshold where itemizing makes sense.
I think charities will be hurt by this.
Those leaning on the MID already lost.
How’s this for a twist with some real humor: FORCE mortgage-holders to use itemized deductions including interest, prop taxes, etc. Everyone else gets the $24k standard deduction. If NAR thinks the MID is such hot-sh*t then let them prove it.
How would that play out? It would be an incentive to rent, maybe. It might also act as an interest rate stimulus for mortgages?
“You aren’t a homeowner if you have a mortgage, you are a renter and your landlord is the bank.”
You are DUMB if you have your $$$ tied up in a house.
You should be putting as little as possible into a house - paying sub-4 interest rate. Now you have less of your $$$ exposed to a housing downturn.
Put ALL your $$$ in Vangard mutuals that have paid a historical 7-11% return for the last 10-15 years!!!! Even with 1-3% down and PMI you will still make out like a bandit in the long run. Only idiots and the unsavvy lock up their $$$ in these boxes….!!!!
The 100% down is lost on most home buyers.
Having a modest house encumbered by a sub 4% interest rate thirty year mortgage with a sub 75% loan to value ratio seems to be the sweet spot.
I’d rather have a sub 4% mortgage and a large portfolio of Vanguard mutual funds than no mortgage and a much smaller portfolio of Vanguard mutual funds.
My PITI+ maintenance & repairs is less than what I would pay for a smaller apartment.
I sleep much better at night knowing that I have tons of liquidity in a diversified portfolio at Vanguard and a manageable, modest mortgage than I would if I had no mortgage and a much smaller Vanguard portfolio.
Housing/shelter is a basic human need and we all have to live somewhere. I’ve made my choices and I’m comfortable that they were the right choices for me.
“Put ALL your $$$ in Vangard mutuals…”
Ownership of real property is more durable than anything Wall street has to offer. Realize that several public pensions have been nationalized in recent years.
More sad panda news from China
Oclaro (OCLR) and Inphi (IPHI) both warned of slowing Chinese demand late Tuesday, sending shares of the fiber-optic plays sharply lower Wednesday, with other optical stocks such as Lumentum (LITE) and Acacia Communications (ACIA) also sliding.
China was a key factor behind the optical “super cycle” thesis. Can the companies and stocks continue to prosper on demand from the likes of Amazon (AMZN), Alphabet (GOOGL) unit Google, Microsoft (IBD) and Verizon Communications (VZ)?
Oclaro CEO Greg Dougherty said in the company’s earnings statement that “during April, we saw a significant slowing of demand in China.” Inphi CEO Ford Tamer gave grim guidance, citing “inventory accumulation in China Long Haul and Metro, which represents 40% of worldwide optical communications demand.”
That follows a warning last week from Macom Technology Solutions (MTSI) of inventory buildup in China, along with other signs that Chinese demand, including from telecom equipment giants Huawei and ZTE, has slackened.
‘Are We About to See Declines in Sizes and Prices of Homes?’
‘NAHB’s chief economist finds home size trends are reflecting a shift in the market.’
By Robert Dietz
‘On a one-year moving average basis, average new-home size was approximately 2,370 square feet for the first quarter of 2010, according to NAHB analysis of Census Bureau data. After the start of 2010, however, home size grew as home builders increasingly shifted to larger, more expensive homes…Average home size grew by more than 13% to 2,683 square feet by the start of 2014. At the same time, the difference between median new-home prices and median existing-home prices expanded. In 2010, that gap was about $48,000. By 2014, it had grown to more than $76,000.’
‘However, a couple of market changes have since taken place. First, over the course of 2014 and 2015, the growth of new-home size stopped. This marked the end of the market shift to the high end. Second, since the end of 2015, average new-home size has fallen. For the fourth quarter of 2015, on a one-year moving average basis, average new-home size stood at 2,691 square feet. By the end of 2016, it had fallen 2% to 2,635 square feet.’
‘Typical new-home size remains larger than just a few years ago. Nonetheless, this (small) decline is consistent with an overall broadening of new-home inventory being offered by builders, with more entry-level homes and townhouses being constructed to meet growing and unmet demand at the lower end of the market. During this same period, there has been a slight closing of the price gap as well, with January 2017 data indicating a difference between new and existing median home prices of $71,000.’
‘The question for the marketplace is whether additional declines in size and price will take place in the quarters ahead.’
And there was a flurry of duplicate articles penned by those crooks around 2008.
Coincidence?
I’m surprised they didn’t mention one floor living with no stairs. Those McMansions are SKEWERED.
The houses are getting smaller in my little burg, but they still have big prices. I’m not sure they’re building anything for under 300K, even though there are few good jobs.
Prices are even crazier in Ft. Collins, which to its credit does have a much better job base with the State U, HP, Intel, Advanced Energy and other employers; but it’s still insanely overpriced. Not Boulder overpriced, but they’re trying. I suspect that Ft. Collins is pulling prices up in my little burg.
pretty soon the public workers like police & fire will start demanding raises ’cause over in Boulder THEY PAY MORE … and don’tcha know you GOT to pay as much to keep good people!
Then Boulder uses the new higher rate to leverage a raise.
repeat. rinse. repeat.
here in union-backed CA they have it down to a fine art & start the merry-go-round raises every so often.
From what I’ve heard they have no shortage of applicants for .gov jobs in Ft. Collins (or Loveland for that matter). The waiting list for firefighters is decades long.
TABOR does help keep those pay raises in check, though. In my little burg, only cops and firefighters have pensions. Other muni employees get 403b plans.
Silverdale, WA Housing Prices Crater 9% YoY
https://www.zillow.com/silverdale-wa/home-values/
Buy a home, get a car free: offers galore as London estate agents struggle to sell
Incentives including stamp duty subsidies of £150,000, iPads, sound systems and travel deals launched to lure buyers to purchase in capital’s affluent areas
London estate agents have begun to offer free cars worth £18,000, stamp duty subsidies of £150,000, plus free iPads and Sonos sound systems to kickstart sales in the capital’s increasingly moribund property market. The once super-hot central London market has turned into a “burnt-out core” according to buying agents Garrington Property Finders, prompting developers to offer ever greater incentives to lure buyers.
At one development in Muswell Hill, a relatively affluent part of north London, sales agents said this week they would be giving away a Renault Zoe electric car (RRP £18,045) to every house buyer. They would also pay stamp duty on the £1.99m homes, at £153,000.
https://www.theguardian.com/business/2017/may/03/buy-a-home-get-a-car-free-offers-galore-as-london-estate-agents-struggle-to-sell
Apologies if this has been posted before
Rents in London have fallen sharply, with new tenants in the capital typically paying almost £100 a month less than their counterparts a year ago, according to a major lettings agency.
London has seen a “sharp fall” in rents over the last 12 months, with the average monthly amount paid dropping from £1,297 a year ago to £1,203 in March 2017, said Your Move, which publishes a regular buy-to-let index. In March alone, typical rents in the capital fell 6%, it added.
The company also reported a decline of 3.7% in rents in south-east England during the month of March, as well as smaller falls in several other regions across the UK.
Your Move said the falls reflect the fact many people looking for rental properties had switched their focus away from London. Nevertheless, the capital remained the most expensive place to rent a property, the company added. The figures, which are based on an analysis of around 20,000 properties in England and Wales, show that the average rent in England and Wales was £800 in March.
Your Move added that the east of England was now the most expensive place to rent a property outside London, at an average of £883 a month, putting it ahead of the south-east (£845). Typical rents in the east of England have risen 7.4% in a year.
The figures broadly tally with data from Countrywide, the UK’s biggest estate and lettings agency, which said in March that rents in Britain recorded their first annual drop for six years.
https://www.theguardian.com/money/2017/apr/28/london-rents-fall-sharply-as-monthly-bill-drops-across-uk
Well … it finally happened.
Puerto Rico files for biggest US municipal bankruptcy
http://money.cnn.com/2017/05/03/news/economy/puerto-rico-wants-to-file-for-bankruptcy/index.html
$70 billion is owed. That’s just over $20K for every person on the island.
So … bailout or will creditors take it in the shorts?
No bailouts!
We are supposed to be capitalists.
IL is next w/o 0 bama no bail
I don’t support a bailout…but I think there’s gonna be a bailout.
That’s the only way.
Let’s see Who gets bailed out?
People of PR? no.
Politicians of PR? may benefit slightly.
Gobmit workers of PR? may benefit slightly.
Wallstreet? Ding Ding Ding!!!
Public unions? Ding! Ding! Ding! Ding!
Nah the private unions of rich folks who you worship will have the last laugh.
Why don’t you try to read the article.
Insane unfunded pensions killed PR.
And they are barely touched in bankruptcy.
Prediction. PR will be back in bankruptcy in 5 years.
The word pension isn’t present anywhere in the article. Once again, the facts don’t matter. As JSandusky suggests, your anti-union attitude is just part of the pro-business agenda, which is really the pro-rich guy agenda. Perhaps the term class warfare applies.
“On the campaign trail, Donald Trump said he would not “bail out” Puerto Rico. He repeated that again in a recent tweet.”
Gotta wonder if Hillary follows his tweets?
Two adjacent headlines on money.cnn.com:
“No Fed rate hike; but officials see more ahead”
“Fed may have to cut rates if Trump can’t boost economy”
Pick your favorite.
So … bailout or will creditors take it in the shorts?
Both, but Trump should demand wall money for any relief given to Puerto Rico, that would put Pelosi between a rock and a hard place.
Ouch! Her brain - tiny as it is - would explode. Might not be able to hear it happen though.
Been reading about how crime infested the Caribbean is - and just bumped into someone who got jumped in USVI. Says everyone is either on crack and wants to kill you or is stoned and super chill. We need to cut PR loose - they can move in with Maduro.
I laugh when I see the rich white Yankee looking for their beach dream house on a Caribbean island or Central America on HGTV
The realtor never tells them about the crime rate one mile from the beach…
wall money ??
What a friggen joke.
Are you not done benefiting from cheap labor? Time to pay up, sucker!
Sachse, TX Housing Prices Plummet 9% YoY As Dallas Area Housing Demand Craters
https://www.zillow.com/sachse-tx/home-values/
Are Americans finally wising up and disconnecting from corporate media propaganda?
https://news.fastcompany.com/cord-cutting-spikes-fivefold-in-cable-tvs-worst-quarter-ever-4036578
It used to be my extended family had a lot of people vegging in front of the tube every day/evening. Now they are in front of a computer or on their phones. I see a few really old school die hards still doing it but I think the only “good” demographic left is the sports fans.
There are more vegging options when a computer or phone is used. On the other hand, not many people have been killed or maimed due to people driving and watching TV at the same time.
Toronto home-sellers are trying to bail before the bottom drops out.
http://www.businessinsider.com/toronto-real-estate-listings-soar-sales-decline-2017-5
“La Crescent Realtor Found Guilty, Admits To Forging Difficult Clients Signature”
http://lacrossetribune.com/houstonconews/news/local/la-crescent-realtor-found-guilty-admits-to-forging-difficult-client/article_d7964b8e-9cae-519a-b6ab-d38c658b2d6e.html
MSU students make use of de-stressing donkey
By Rolf Tengdin Chronicle Staff Writer
May 2, 2017
Inside the front doors of the Montana State University Library on Tuesday, a 900-pound donkey named Oliver blocked the main entrance, forcing students to squeeze by.
Oliver was one of several animals at the MSU Library on Tuesday helping students relieve stress during finals week.
http://www.bozemandailychronicle.com/news/montana_state_university/msu-students-make-use-of-de-stressing-donkey/article_7e5a297a-d337-55e5-89b3-fbd74a2739c2.html