June 18, 2017

It Was A Pretty Good Story About A Lack Of Supply

A report from the South Bend Tribune. “The sun beat down on a recent weekday as crews worked to level 29 acres of land for The Reserve, a new 390-unit luxury apartment complex. Watermark Residential, a developer out of Indianapolis, announced the project in September, when it filed to annex the property into the city of Mishawaka and rezone it from agricultural to residential. The Reserve is among a slew of new projects as the local rental market rebounds from an extended down period, with developers projected to add 2,000 new units to the market by the end of next year — compared with just 205 the previous four years.”

“Compared with other urban markets, South Bend has lagged in new apartment construction over the past few years, with only a few hundred units added from 2013 to 2016, and zero in 2014 and 2015. ‘I think what you’re seeing across most of country right now is oversupply. We like the schools up there, and we like the fact that it’s close to new retail,’ David Englert, director of acquisitions for Watermark, said. ‘And then up until recently, it was a pretty good story about a lack of supply of new apartments being delivered.’”

“The problem is particularly acute at the high end of the market, Englert said, characterized by upscale, single-family-style developments with pools, fitness centers, lounges, game rooms, rooftop terraces, dog parks or walks and other amenities. ‘That’s the market that virtually everybody whose building now, that’s the market they’re going after,’ said Michael Zink, senior vice president of multi-housing with South Bend-based Bradley Co.”

From Crain’s Chicago Business. “Building booms often end badly, especially those—like in the student housing sector—that have stretched out for several years. While a few college towns where Core Spaces doesn’t operate, such as Baton Rouge, La., and College Station, Texas, are getting overbuilt, the U.S. market remains healthy overall, says Taylor Gunn, a student housing analyst at Axiometrics. Developers are expected to complete 47,122 off-campus student-housing beds around the country in 2017, roughly equal to the last two years, and down from more than 62,000 the two years before that, according to Axiometrics.”

“Marc Lifshin’s company, Core Spaces, develops buildings with golf simulators, spas with plunge pools and tanning beds, and in-room hot tubs. As student housing developers have tried to one-up each other with amenities, some observers have questioned the focus on luxury, grumbling that college has become a country club for rich kids.”

“A Core Spaces project in Madison, Wis., includes a band room and ice rink in the winter. This year, Core Spaces will wrap up a second development in Madison and one in Seattle. Projects in Ann Arbor, Mich., Tuscaloosa, Ala., Minneapolis and other towns are on tap for 2018. ‘This is kind of the third inning of student housing right now,’ says Lifshin. ‘I don’t think we’re close to the peak yet.’”

From Costar. “The senior housing sector saw elevated expansion levels of new units in the first quarter of 2017, with the additional new inventory offsetting otherwise healthy levels of absorption, according to Tim Komosa, an economist manager for Fannie Mae. A combination of high levels of new construction and unexpected interruptions in demand have resulted in Houston, Las Vegas and San Antonio having the lowest occupancy rates among the large metros for seniors housing. Total absorption for seniors housing declined from the recent record levels. Annual rent growth for seniors housing declined from its recent peak.”

“‘Given the robust supply that segment has seen in the past five years, this (lower) level of occupancy is likely just a result of slightly too much supply in a short period,’ Komosa said.”

The Anchorage Daily News in Alaska. “Anchorage’s typically tight rental market is loosening. Vacancies are up and rents are down compared to last year, with some landlords even offering one month free on a year lease and other incentives. In Carolyn DeYoung’s experience, some property owners are still adjusting to the new reality of the rental market. ‘I’ve had to call more than one owner to say ‘OK, they (the prospective renter) will pay $1,500 not $1,600 a month, because they can rent the same thing down the street,’ said DeYoung, who has worked in the industry for 18 years.”

The Real Deal on Florida. “Demand remains robust for rental housing in Miami and the rest of South Florida, among residents and real estate investors alike. But despite the area’s population and employment growth, some market watchers say South Florida’s extended, postrecession rise in monthly rents could slow or stop if overbuilding floods the market with units. ‘Luxury rents are going to start coming down as more and more individual investors put their condos on the market to rent,’ said Joe Lubeck, CEO of Robbins Electra, which owns and manages about 23,000 units in multifamily developments in Florida, Georgia, Maryland, North Carolina, Texas and Virginia.”

“‘That probably will be most problematic in Miami, but we’ll also be seeing it in all the major metropolitan areas, because so many of the new condominiums are being bought to rent out,’ Lubeck says.”

“Rents at less luxurious locations in South Florida are bumping up against their upper limits, too, said Mike Pappas, president of South Florida residential brokerage firms Keyes Company and Illustrated Properties. ‘There’s no question there has been a skyrocketing of rents in the last five years that has peaked,’ Pappas said. ‘We’re starting to see rental prices wane, or at least pause.’”

The Washington Post. “Richard Florida is rethinking things. Since publishing the best-selling book The Rise of the Creative Class in 2002, Florida has used his considerable speaking and writing heft to push mayors, urban planners and company executives to cater to tech-savvy young professionals. His argument, in short, was that to save themselves from postindustrial ruin, cities needed to attract the best young talent in computer programming, engineering, finance, media and the arts so their towns could build economies based upon the venture capital and start-up companies the new workforce would produce.”

“Often taking a cue from Florida’s mantra, real estate developers dialed up hip but tiny apartments designed for creative millennials and outfitted them with coffee bars, gyms, pool tables, bocce courts, pool decks and fire pits. Somewhere along the way, however, Florida realized that the workers he so cajoled were eating their cities alive.”

“‘I think, to be honest, I and others didn’t realize the contradictory effect,’ Florida said in April at a panel discussion. He said he realizes now that prompting creative types to cluster in small areas clearly drove living costs to such heights that low-income and often middle-income households have been forced elsewhere, creating a divide.”

“As inequality has deepened in top cities, writers on class and poverty have begun to take sharper aim at Florida’s theory, calling the ‘creative class’ a fallacy and a failed experiment, not because he was wrong that investing in cities would help draw the creative class but because he argued that doing so would benefit cities at large. So although he still champions investments in urban areas, at the panel event Florida said the criticism had made a mark.”

“‘To be seen as the neoliberal devil, foisting gentrification on cities, is not a situation I like to be seen in,’ he said.”




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63 Comments »

Comment by Ben Jones
2017-06-18 06:37:31

‘pools, fitness centers, lounges, game rooms, rooftop terraces, dog parks or walks and other amenities. ‘That’s the market that virtually everybody whose building now, that’s the market they’re going after’

Check out the Read Deal report to see how blinded some of these people are due to the investor cash. They aren’t going to slow down. The Core Spaces company just sold a recent build for twice what it cost to construct. Do you think they’ll slow down?

Comment by palmetto
2017-06-18 07:19:12

“how blinded some of these people are due to the investor cash.”

Seems to be a thing these days, same problem with the so-called “tech” market. Snapcrap, Uber, heck, they’re even talking about taking Reddit public now. Nothing more than a message board. And yet millions, even billions flow into these companies. And yet, there’s no “there”, there.

Comment by AbsoluteBeginner
2017-06-18 12:38:27

‘heck, they’re even talking about taking Reddit public now. ‘

Sign that they want to cash out while the cashing out is good.

 
 
Comment by Ol'Bubba
2017-06-18 19:39:12

” ‘That’s the market that virtually everybody whose building now, that’s the market they’re going after.’”

Many things are very easy to overlook. Here’s something to scratch your heads about.

If you are a developer of multifamily real estate projects, then you need to address the needs of a wide range of stakeholders to bring a development project to completion, one of which is the people who will ultimately lease the units in your project. They’re not the only stakeholders, and not the first stakeholder in the line to get a project built.

Some of the other stakeholders are the municipality and its planning department, the general contractor and subcontractor (tradesmen - carpenters, electricians, painters, etc.), and the sources capital: equity investors and construction lenders, and later, the permanent lender. These stakeholders come before the renters in the project timeline.

What gets lost in the discussion is that if you’re a developer courting institutional investors for equity to invest in your project then you need to sell what the investor is buying. In recent years, these institutional investors are looking for shiny projects that look good in a glossy brochure that they can use to raise money.

Bread and butter plain Jane projects don’t hold much allure for the white shoe investors who want pictures of the sparkling new pools and the units with the granite counters, stainless appliances, dog washing stations and the like to slap into the brochure used to raise capital for their next Investment Fund.

The planners, equity investors, construction lender, general contractor and tradesmen all come before the tenants on the project timeline.

Based on what’s been built over the past 5 years and what’s being built, it looks like the big money investors want the flashy looking projects, and they’ll worry about leasing them up down the road.

Comment by SW
2017-06-18 21:43:34

Good commentary Bubba.

 
Comment by Rental Watch
2017-06-19 10:27:31

Flashy looking projects, but also flashy locations.

Foreign capital doesn’t want to invest in what they consider “secondary” or “tertiary” locations. They stick to the “Gateway” cities, including Miami, NYC, SF, Chicago, LA.

In many other such cities, real estate is priced almost like artwork, rather than cash-generating businesses, and so yields in many other global “Gateway” cities are also low, but “trophy” assets.

Foreign capital flows have been strong to gateway cities in the US, and low yields are OK, but only if they are showing a “Class A” building.

 
 
 
Comment by Ben Jones
2017-06-18 06:40:03

‘To be seen as the neoliberal devil, foisting gentrification on cities, is not a situation I like to be seen in,’ he said.’

Look Dick (can I call you Dick?), don’t be so hard on yourself. You aren’t that influential. The oceans of cash chasing a story had much more to do with this bubble than your book.

Comment by palmetto
2017-06-18 07:07:03

“‘I think, to be honest, I and others didn’t realize the contradictory effect,’ Florida said in April at a panel discussion.

No one could have seen it coming!

It’s true, though, he isn’t that influential. Belongs in the Greek chorus with Malcolm Gladwell and Thomas Friedman and Howard Kuntsler and others.

Besides, Flo Rida is probably better known.

 
Comment by butters
2017-06-18 07:40:12

Exactly! Dick, who?

What a pedestrian & banal his articles (and book) are. I doubt anybody made any life altering decision listening to this fraud.

Comment by Ben Jones
2017-06-18 07:47:03

‘Neel Kashkari of the Minneapolis Federal Reserve seems oblivious to all this, at least according to critics knocking Kashkari’s recent essay about asset bubbles and what the Fed ought to do about them. Kashkari’s entirely sensible answer: not much.’

‘I appreciate [you] responding to my essay,’ he responded via Twitter to a blog arguing that spotting bubbles isn’t difficult at all. ‘If so easy to spot bubbles, why tell us? Launch [hedge fund] and short ’em. Make trillions. No? Just talk then.’

There’s this “elitist” attitude with these people. Save us from post-industrial ruin? Neoliberal devil? I’m not surprised the Washington Post made a big deal out of this dude. Wait until these white elephants turn out to be just that.

‘A white elephant’ -
http://www.phrases.org.uk/meanings/white-elephant.html
Meaning. A burdensome possession; creating more trouble than it is worth.’

Comment by Raymond K Hessel
2017-06-18 07:51:25

When Grandma Yellen drives the car into the ditch, frauds like Kashkari will solemnly intone that “No one could’ve seen it coming.”

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Comment by redmondjp
2017-06-19 09:25:44

I don’t know why, but I am reminded of “Toonces the Driving Cat” from SNL skits - check them out online.

 
 
Comment by butters
2017-06-18 07:57:06

With people like Cashcurry, it’s the hubris at this point. They are probably praying they all die before all this collapses.

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Comment by Ben Jones
2017-06-18 08:05:53

This guy is supposedly the main internal “critic” at the Federal Reserve. Imagine how “oblivious” the rest of them are.

 
Comment by palmetto
2017-06-18 08:29:42

“Cashcurry”

OK, now that’s just too funny right there, I don’t care who y’are.

 
Comment by Rental Watch
2017-06-18 09:48:03

Kashkari is a huge critic of Dodd Frank as being unworkable (thousand page bank shutdown plans are unworkable over a weekend), and a big proponent of massively increasing equity requirements for the largest banks (thus effectively setting conditions for their voluntary break-up).

We can either have more and more regulation in an effort to thwart bubbles, or we can have less, but stronger regulation in order to push the risk back to the financial industry without risk of government bailouts.

Anyone who is in favor of limited but strong, regulation and reducing the potential for government bailouts is OK with me.

 
Comment by Ben Jones
2017-06-18 09:54:42

That’s all fine and good, but what about the GSE’s? There’s a reason a Fannie Mae economist is commenting on the senior living biz above.

 
Comment by scdave
2017-06-18 09:58:25

Dodd/Frank is a nightmare…

 
Comment by Rental Watch
2017-06-18 10:19:01

I haven’t seen a satisfactory answer for the elimination of the GSEs.

I still like my idea of slowly increasing the required down payment in order to obtain government backing. 0.25% per quarter (1%) per year.

It will give markets plenty of time to fill the void, and over time, the loans that the government backs will be safer and safer…and eventually the GSEs will either stand on their own, or be uncompetitive. The market will find the right balance of creditworthiness and down payment.

The GSEs have the same problem as the ACA. Once you give the people free sh*t, no matter how bad the setup for that free sh*t, it’s almost impossible to take it away.

I was just in France with my very left-leaning mother-in-law. I think it was eye opening for her to hear of massive unemployment benefits, still see homeless people, that the wealthy people are leaving due to overtaxation, and that people with wealth as little as 1MM Euro are taxed on their wealth each and every year.

BTW, she didn’t like the wealth tax idea one bit…although, like everything, I’m sure she’d be fine with it if it didn’t effect her.

Brings up the quote (yet again), that socialism works really well until you run out of other people’s money.

 
Comment by scdave
2017-06-18 11:04:40

The GSEs have the same problem as the ACA. Once you give the people free sh*t, no matter how bad the setup for that free sh*t, it’s almost impossible to take it away ??

We spend more on the military then the remainder of the world combined and other than the sequester, we never take any of it away…Does spending that kind of money in comparison to the rest of the world in the name of “keeping us safe” even stand the “common sense” test yet here we are…

 
Comment by Mr. Banker
2017-06-18 13:06:52

“Brings up the quote (yet again), that socialism works really well until you run out of other people’s money.”

Hey, do does banking!

 
Comment by Mr. Banker
2017-06-18 13:09:47

Er, SO does banking!

Without other people’s money to loan out I’d have to loan out my own money, and thus eat any losses.

Bummer.

 
Comment by Rental Watch
2017-06-18 18:17:37

We spend more on the military then the remainder of the world combined and other than the sequester, we never take any of it away…Does spending that kind of money in comparison to the rest of the world in the name of “keeping us safe” even stand the “common sense” test yet here we are…

Same principle. It’s easy to increase budgets, or even keep them the same, but to cut a budget? Even when the expenditures are unnecessary? Forget it. Military spending is sprinkled throughout a huge number of congressional districts. No one wants budget cuts to impact their own district, so it’s easier to keep the budgets as is, or growing, than to shrink them.

Because of this imbalance (it being so easy to spend more, so hard to spend less), there should be much more scrutiny when laws like the ACA are passed. Just doing “something” because you can isn’t good enough.

 
 
 
 
 
Comment by Ben Jones
2017-06-18 07:22:17

‘buildings with golf simulators, spas with plunge pools and tanning beds, and in-room hot tubs…A Core Spaces project in Madison, Wis., includes a band room and ice rink in the winter. This year, Core Spaces will wrap up a second development in Madison and one in Seattle. Projects in Ann Arbor, Mich., Tuscaloosa, Ala., Minneapolis and other towns are on tap for 2018.’

‘This is kind of the third inning of student housing right now,’ says Lifshin. ‘I don’t think we’re close to the peak yet.’

Elsewhere in the article one guy ponders making this stuff just a tiny bit less costly, adding amenities that actually get used and generate revenue.

I had to look up plunge pool. Looks like a really small pool with fancy do-dads around it. Not big enough to swim in.

Comment by oxide
2017-06-18 12:22:52

I wouldn’t mind a Scarface-style in-room hot tub myself.

But how is a “band room” a luxury? In my high school the band room as located in the wing where the gym was, as far away from the classrooms wings as they could get. For good reason.

Or maybe it’s a room where you and your buddies can rock out? I could have used one of those in college. One the mates on the dorm floor used her room as an amateur (REALLY amateur) jam studio for Guns-n-Roses.

 
Comment by Montana
2017-06-18 13:26:17

So…are these student housing units typically rented with Pell Grant and stafford loan bucks? Or are they strictly for richie rich paygo students?

Comment by Rental Watch
2017-06-18 18:19:34

If I recall correctly, when I took out Stafford Loans, they didn’t follow each dollar, so I think I could use some of the money for rent…regardless of where you were living. I was living in an apartment at the time.

 
 
 
Comment by palmetto
2017-06-18 07:29:28

“The problem is particularly acute at the high end of the market, Englert said, characterized by upscale, single-family-style developments with pools, fitness centers, lounges, game rooms, rooftop terraces, dog parks or walks and other amenities. ‘That’s the market that virtually everybody whose building now, that’s the market they’re going after,’ said Michael Zink, senior vice president of multi-housing with South Bend-based Bradley Co.”

Meanwhile, back at San Francisco’s luxury leaning tower:

http://www.mercurynews.com/2017/03/29/homeowners-at-san-francisco-sinking-high-rise-sue-developer/

“The building has a sprawling indoor lap-pool, a health club and spa, an in-house cinema, and a restaurant and wine bar run by celebrity chef Michael Mina. Penthouses have sold for more than $13 million.”

Come for the wine, stay for the whine!
or, come for the lap pool, stay for the bends!

Comment by Avg Joe
2017-06-18 09:12:22

Come for the wine, stay for the whine!

LOL!

 
Comment by rms
2017-06-18 12:53:42

South Bend Craigslist… bye bye toyz!
https://southbend.craigslist.org/cto/6168181786.html

Comment by phony scandals
2017-06-18 15:45:21

Only $69k :)

Comment by In Colorado
2017-06-18 15:53:24

I can think of so many brand new cars I would rather spend 69K on than a two year old, tricked out pickup truck.

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Comment by Raymond K Hessel
2017-06-18 16:02:56

But…but…it’s Inferno Orange! With a kick-a$$ sound system!

(But it’s still a depreciating asset.)

 
Comment by phony scandals
2017-06-18 17:55:24

The Factory remote start should come in handy for the Repo man.

 
 
 
 
 
Comment by Ben Jones
2017-06-18 07:39:38

‘Luxury rents are going to start coming down as more and more individual investors put their condos on the market to rent,’ said Joe Lubeck, CEO of Robbins Electra, which owns and manages about 23,000 units in multifamily developments in Florida, Georgia, Maryland, North Carolina, Texas and Virginia.’

‘That probably will be most problematic in Miami, but we’ll also be seeing it in all the major metropolitan areas, because so many of the new condominiums are being bought to rent out’

They talk about the “sweet spot” for rents at $4-6k/month. These aren’t being bought to rent out because there aren’t enough rich renters. These are flips gone bad, like in NYC. And after they sit empty for months these guys will bail. And as they do the HOA fees will overwhelm the remaining suckers just like they did before.

Comment by butters
2017-06-18 08:56:10

more and more individual investors put their condos on the market to rent

Wha….?

I thought it was demand and supply. Demand for shelter.

 
 
Comment by Ivy
2017-06-18 10:33:00

I’m seeing listings from thousands of miles away showing up on craigslist for my area. Looks to me like land in the PNW and condos in San Diego are a sell, bigly!

 
Comment by Brynn
2017-06-18 13:20:20

POV from observations after sixty-something years of living and current decade and half in Central Arizona. In recent times we’ve had financial and housing fallout and I now I suspect we are building up toward a senior crisis, by which I mean that many older people nearing retirement age have saved little, and many have increasing health care issues at time when healthcare costs have never been higher (and will continue to climb) and where changes and cuts in Medicare and Medicaid are fairly certain. I work around seniors five days a week and see and hear many sobering life situation stories up close and personal. Housing (rentals and single family residences) inventory in Central Arizona is very slim, prices are at/near pre-bubble levels and investors (mix of out-of-state, international and Southwest area investors) are sucking-up anything half-way decent on new and resale real estate market. Investors are loving the high rents of local rental market, and not even taking into account the younger generations now entering the home buying process. I’m very cynical, given past behaviors in America from lending, real estate, financial institutions, ratings agencies and government agencies to treat the public in an ethical manner. I do not see the near future heading in a positive way for to many older Americans unless they have a good firewall around them to include decent pension, healthcare, paid-off housing, eldercare savings and retirement portfolio diversified with low-cost, low risk balance of assets. Interested to read what others are thinking about this given the area(s) where you live? Just because some have planned for their futures does not mean that those who have not, will not cause adversity for all of us who are headed into out retirements. It seems so often it is the Americans of little who fight the wars and suffer the harshest ramifications from those with the most, but then hasn’t it mostly alway been this way?

Comment by GreenEggsAndSpam
2017-06-18 16:08:07

In my neck of the woods the military comes through once a year for a week or two and offers free basic medical care. LOTS of people go to that and are very thankful for it. People are scraping by, trying to pay the bills on time all the while in the same county you have mansions being built that are 2nd, 3rd or beyond homes for the ultra wealthy and are only occupied maybe a a few weeks out of the year (some you can rent, 5-10K/week). Lots of old people selling off land in order to pay for their medical care too.

One of my friends just started out a new gig as a pool boy. I think he’s late 30s, early 40s so the cash flow is stressing him and he was describing one of the customers as a wall street trader who claimed on a good day he makes upwards of 12K. My friend asked me if I thought we were living in a holographic projection based on the fact that this guy was able to make a fortune creating money out thin air, selling a fantasy about some mythical notion of value. I guess to some this life is a dream and to many more its a nightmare.

 
Comment by aNYCdj
2017-06-18 16:20:56

my take is plan B is to game the system, to learn its rules such as money in an IRA is not counted but a whole life that has a cash value is. Tools of the trade are usually exempt from declaration, Lots of states offer seniors Free or very low cost tuition in college. Find out where there might be a food pantry for diabetics. Since most food pantries offer mostly junk sweetened preservative type kids food eq most have Ragu but not no salt diced tomatoes. Or Capt Crunch or count Chocula, but not plain oatmeal.

Its always been living at or below your means. why get a new car if there is a reliable bus line near your home, that goes to the doctors dentist and food shopping? Lots of pharmacies offer delivery. Its not as convenient as a car, but riding the bus is standard in NYC so why not try it elsewhere? Look at the bus routes before you move to a new city, see if you can live without a car for a while.

even found enterprise $9.99 a day for a weekend special renting a car….not during summer though https://slickdeals.net/f/10008364-9-99-per-day-enterprise-rental-car-weekend-rate-good-until-5-22-17

 
 
Comment by aNYCdj
2017-06-18 14:25:54

Donald Trump’s childhood Queens home finds a renter in less than a day
The Tudor home in Jamaica Estates was listed for $3,500 but rented for more

https://ny.curbed.com/2017/6/15/15811282/donald-trump-queens-home-for-rent

 
Comment by aNYCdj
2017-06-18 14:38:09

Burned former home of President Clinton a total loss

June 18, 2017 — 3:05pm
FAYETTEVILLE, Ark. — A northwest Arkansas house once occupied by former President Bill Clinton that was damaged by fire has been deemed a total loss.

The home now owned by Stephanie and Robert Dzur and occupied by Stephanie Dzur’s father burned June 8.

The Arkansas Democrat-Gazette (http://bit.ly/2rtuHjM ) reported Sunday that Stephanie Dzur says her insurance agent told her the home is damaged beyond repair and will have to be torn down.

The home was built in 1957 and is listed on the National Register of Historic Places as the Adrian Fletcher Residence. Clinton lived there in the mid-1970s when he was a law professor at the University of Arkansas in Fayetteville before moving to another home and marrying Hillary Rodham Clinton.

The home where the Clinton’s lived after marrying is now the Clinton House Museum.

Comment by AbsoluteBeginner
2017-06-18 18:00:21

‘Clinton lived there in the mid-1970s when he was a law professor at the University of Arkansas in Fayetteville’

That is what I never got about Bill Clinton. He seems to be an incredibly smart and motivated person. But I always picture a Caligula under that veneer.

Comment by palmetto
2017-06-18 18:26:18

I always thought of GWB as Little Caligula, but yeah, the whole Clinton thing is really peculiar. Another one of those guys who sort of came out of nowhere to become prez, with a wife saying “Wait, me, too!”

I’d love to know the real scoop on the Clintons. So much speculation, so many stories swirling around them for years.

Comment by AbsoluteBeginner
2017-06-18 21:54:47

Started reading ‘Kennedy Babylon’ by Howie Carr. Only finished maybe 40 pages of 250 total. Confirms the belief that there is some kind of matrix club and I am not part of it.

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Comment by Raymond K Hessel
2017-06-18 15:08:29

High rents have made it difficult for prospective homebuyers to put together enough money to make a purchase, even as housing becomes increasingly unaffordable for middle and working class people.

Heckova job, Ben & Janet.

https://www.washingtonpost.com/business/higher-prices-squeezing-both-renters-and-would-be-homeowners/2017/06/16/73fd3a9c-5281-11e7-b74e-0d2785d3083d_story.html?utm_term=.7ec80bfdc892&wpisrc=nl_az_most&wpmk=1

 
Comment by Rentor
2017-06-18 15:52:11

Any opinions how over/under valued single family homes are in San Francisco Bay Area. That has to be ground zero for a reset and the start of the next recession.

If H1b is modified to only allow talented people in that could impact rental pricing. One thing most H1b’s who have applied for a Green Card don’t realize is your income has to be at the higher end of regional income for the job you do to be considered for a GC.

 
Comment by phony scandals
2017-06-18 15:59:33

RIP Kent Dorfman

Stephen Furst (1954 - 2017)

Stephen Furst, the actor best known for playing Flounder in “Animal House,” died Saturday, June 17, 2017, from complications related to diabetes, according to multiple news sources. He was 63.

http://www.legacy.com/obituaries/greenwichtime/obituary.aspx?n=stephen-furst&pid=185838065#sthash.mLKg3DkU.dpuf

Comment by palmetto
2017-06-18 17:48:42

Road Trip!

 
 
Comment by palmetto
2017-06-18 18:06:23

OK, this is totally OT, but in case it might help anyone, I got a buddy of mine one of those little IcyHot SmartRelief TENS units for his birthday on account of he’s had back pain for years and done everything short of surgery to handle it and hasn’t gotten much relief. He’s kind of a cheapskate, so I figured if I got it for him and it didn’t work, he wouldn’t complain about spending the money.

Anyway, the guy was almost crying thanking me. Said it was the first time in years he’s had any real relief, and he’s one of the biggest skeptics I know.

I haven’t tried it myself because I don’t have back problems, so I can’t personally vouch for it, but if it works for him, it must be pretty good. I read some of the online reviews before I bought it and a LOT of people had very good things to say. I dunno, just wanted to mention it. I don’t usually plug products, but this one seems to be pretty effective. I might get the one for the shoulder, though. Sometimes my throwing arm gets a twinge.

Comment by Rentor
2017-06-18 19:36:43

He should consider Back surgery After this company America gets it’s product approved later this year or early next year. At only 32 cents stock looks interesting. AMDA. Keep an eye on stock for next two weeks see if they have some major news

Comment by AbsoluteBeginner
2017-06-18 21:57:47

Aaah, a stock that Robinhood was made for. lol

Seriously, no commissions. Total gamble, but no commissions.

 
 
 
Comment by AbsoluteBeginner
2017-06-18 18:49:56

Disruption:

https://www.youtube.com/watch?v=CWjqIyLXLDU

I just don’t see these taking off for $40K especially if you have to find the land to park it.

 
Comment by palmetto
2017-06-18 19:30:12

Wait, WHAT?

http://www.zerohedge.com/news/2017-06-18/mueller-has-not-yet-decided-whether-investigate-trump-abc

Well then what in the name of jeebus is this guy doing there and staffing up? Playing pocket pool?

Heh, maybe that rumor going around about what Sessions got a hold of when they cleaned out Comey’s office is true. Or maybe Mueller doesn’t like the mud that’s starting to get splashed on him.

Never should have happened in the first place, especially after Comey admitted to rigging things so a special prosecutor would get appointed. And not just any special prosecutor, but his buddy and mentor. At the very least, it reeks of impropriety.

 
Comment by Larry Littlefield
2017-06-19 05:05:47

I stayed in South Bend a couple of days ago, on a trip back and forth to Chicago to help my daughter move.

It was one of the most depressed and depressing places I have ever seen, and I’m not one who is automatically repelled by poor people or urban areas — even old, industrial, crumbling urban areas. This place was really run down and desperate looking.

Yes there is Notre Dame away from the near airport motel we stayed at, and the downtown and south side we drove through on our way out of town, and we didn’t see it. But we found it hard to believe the home of such a large and well known institution — and its associated jobs — would be in that kind of shape. It must have been a major industrial center, with the university a small part of the economic base, and too small to affect overall conditions.

Driving off the interstates, Indiana in general seemed to be is lousy shape compared with Ohio and Michigan. The only people who seemed to be doing OK on the state’s northern tier are the Amish.

Comment by palmetto
2017-06-19 06:05:35

My mother traveled there on business during the 1970s and back then she said it was the most depressing place she’d ever been.

“Driving off the interstates, Indiana in general seemed to be is lousy shape compared with Ohio and Michigan.”

And that should give you a clue about Mike Pence.

 
Comment by goirishgohoosiers
2017-06-19 07:18:36

You should have seen it here twenty years ago; things have improved greatly since then.

There really isn’t anything to do where the airport is located. There is more to do near Notre Dame and downtown.

South Bend probably felt the first jolt of post industrial America when Srtudebaker folded up in the mid 60s while the rest of the country was roaring ahead. It has been a long and sometimes hard recovery, but I finally see some progress.

And housing here is till ridiculously cheap compared to the coasts and Chicago.

 
Comment by rms
2017-06-19 07:28:36

The Studebaker was manufactured there, IIRC.

 
Comment by redmondjp
2017-06-19 09:38:49

I lived in Indiana and Michigan back in the mid-1980s and visited South Bend a couple of times. It was nowhere as near as bad as Gary or East Chicago! Those places made my college town of Flint, MI look good by comparison.

 
 
Comment by Ben Jones
2017-06-19 05:25:47

This was posted in the previous comments:

“Jingle Male

I purchased the house in 2009. It had good cash flow (5-6%) for 7 years, but this year, the repairs and maintenance used up 90% of the free cash flow.”

Goes on to say he is going to sell.

If he was being honest it was a lot worse than that. And next year it will cost more and the year after that, etc. Truth is residential RE owners should set aside 5-10% per year for major repairs: roofs, AC, things that are going to cost a lot and will for sure wear out. Bottom line: he hasn’t had any “free cash flow” all along, but was coasting on deferred maintenance. This is why SFR have never been an investment. Multifamily can barely squeak into a reasonable profit and only if the price is low enough. This is what I have been going on about: if these people are paying for, let’s be generous, say 9% cap rate. OK that doesn’t count financing. Today financing will eat that up unless you are some huge established operation. And most rentals I look at are 5% or some other silly cap rate. Almost the entire industry is banking on appreciation only.

Comment by palmetto
2017-06-19 06:01:38

“Almost the entire industry is banking on appreciation only.”

Like the “tech” sector. Amazon comes to mind. Doesn’t cash flow, in the sense of being able to distribute dividends to shareholders.

 
 
Comment by aNYCdj
2017-06-19 06:49:40

another reverse split for the one and only dryships

https://finance.yahoo.com/quote/DRYS?p=DRYS

 
Comment by phony scandals
2017-06-19 07:35:03

xxxxxxx for the Big Money Dawgs building projects throughout SE Region IV say it will remain cranked up through the end of this year and up to the 2018 midterms, after that all bets are off.

I would say this Leak is far more credible than any brought to you by The CBS Evening News this year.

 
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