Not Enforcing Topic A On The Lips Of Every Politician
A weekend topic starting with the Los Angeles Times in California. “On any summer weekend, Venice Beach is the ultimate urban beach carnival. But unlike other tourist spots Venice is still primarily a residential neighborhood. Because of that, Venice has become an epicenter of Los Angeles’ struggle over short-term rentals, what you might call the Airbnb Problem. Over the course of four hours, I visited half a dozen buildings on or very close to the Boardwalk that have been converted, without permits, from long-term rental apartments to short-term rentals, or — yes — let’s call them what they really are: hotels.”
“InsideAirbnb is a website that tracks how Airbnb impacts city rental stock. It estimates that at least 76% of Airbnb rentals in Venice (or 1,582 out of 2,085 listings) are entire homes or apartments, which means, essentially, that those units have been removed from the rental market at a moment when the city’s housing shortage is Topic A on the lips of every politician.”
From ABC 7 Chicago in Illinois. “Despite Chicago’s ordinance limiting the use of Airbnb, some South Loop condo owners said their building has been inundated with people using the popular site. The roof deck of the building at 9th and Wabash overlooks Grant Park and is a short walk from Lollapalooza, - but only for full-time residents. Following the city ordinance, the building’s condo board submitted paperwork to ban home-sharing there. ‘We are seeing either the city is not enforcing this ordinance, or Airbnb is ignoring it,’ said Luke Hanley, condo board president.”
The Idaho Mountain Express. “As short-term rentals have grown in popularity in Ketchum, the rental units on the long-term market have dried up. That was the conclusion of a year-long research project by Genevieve Pearthree, a graduate student who was hired for a city of Ketchum fellowship to study short-term rentals. Pearthree found 471 units listed on short-term rental websites such as VRBO, HomeAway and Airbnb on one day in February. She analyzed listings on VRBO last fall and found 332 units consistently rented on that website.”
“At the same time, the number of long-term rentals declined precipitously in Ketchum, she said. Ketchum had 38 studios for rent in 2012 but only four in 2016. One-bedroom units dropped from 70 in 2012 to 12 in 2016. Two-bedroom units declined from 124 in 2012 to 16 in 2016.”
“William Glenn, a property owner in Warm Springs who uses VRBO, said he rented his property long-term from 1979 until 2013, and had a tenant trash the property before being forced to move out. After that, he said, he started listing his unit on VRBO and has had no damage to the property and only positive experiences renting it to short-term occupants. ‘I’m glad that the state Legislature tied your hands,’ he said. ‘I have no obligation to provide affordable housing.’”
The Canadian Press. “New research suggests a small number of large commercial property owners are the most successful on Airbnb and are eating up the local supply of housing in Canada’s three largest cities. A team of urban planners from McGill University looked at Airbnb trends in Montreal, Vancouver and Toronto and noted a 50 per cent increase in the number of short-term rental properties year over year. Lead author David Wachsmuth said his team found that 10 per cent of hosts account for nearly half of the $430 million yearly revenue in the three Canadian cities.”
“The study suggests the number of entire homes available, full-time listings, and hosts with multiple listings are all on the rise. ‘What ties them together in common is these are not families renting homes while they’re out of town … these are people using Airbnb and other short-term rental platforms as a platform for making money off housing and doing so in a way that’s reducing the available supply of housing in those cities,’ he said.”
From CBC News in Canada. “Officials in Canmore are trying to cut down on the growing number of illegal vacation rentals in the mountain town. Mayor John Borrowman says hundreds of homes in residential areas are posted on websites like Airbnb and VRBO, making an already dire housing shortage worse. ‘Effectively it’s beginning to turn residential neighbourhoods into hotel districts,’ he said.”
“Andrew Shepherd, president of the Canmore Hotel and Lodging Association, is happy the town is going after illegal short-term rentals. ‘The hotels have no problem with competition. But every competition should be on a fair playing field,’ he said. ‘So if we’re paying business taxes, they should too. If we have health and safety inspections, they should as well.’”
From Metro News in Canada. “Stories about a recent study from McGill that found the majority of money from Airbnb rentals is collected by a slim majority of property owners were right to focus on the growing unaffordability of housing. But to understand that properly, we need to recognize this: Airbnb is not part of a ‘share economy’.”
“On the contrary, Airbnb is designed – quite obviously – for people who already have property to make more money from it. In 2015, Chase released a study it conducted on over 200,000 randomized, anonymized banking customers who earned income from the platform economy. Among its findings, the study showed that 21 per cent of those sampled participated in labour platforms (eg. Uber), 71 per cent participated in capital platforms (eg. Airbnb), but only two per cent did both. This puts to bed any notion of a collective ‘share economy’ – there are two distinct industries at work.”
“Importantly, the study also found that capital platform participants made more money than their labouring counterparts. Effectively, it suggests that those at an advantage are continuing to gain more of an advantage, and those who are initially less advantaged are not catching up.”
“In context of figuring out how to regulate something like Airbnb, these kinds of numbers are important, but just as crucial is understanding that it is not a benign ‘sharing’ app, but a platform that perpetuates the creation of capital for a particular class of people. Which is fine; it can be that. But we should be clear on what that means. Whether someone is making $2,500 in eight months or tens of thousands a year, we should remember one thing: Airbnb is perpetuating – not solving – an income divide.”
I should explain to new readers that I consider this industry to be riding on the housing bubble, because if it wasn’t for skyrocketing prices I doubt these people would be doing this: politicians or toilet scrubbers.
The toilet scrubbing industry…LOLOLZ!
Years ago when I was a public accountant I worked on a tax return of a lobbying firm (it was just a group of lawyers). It was pretty clear: tons of money came in, they wrote huge checks to politicians and kept a tidy sum for themselves. No court cases, no work. Lots of write-off for expensive meals, gifts and nice cars. So just how did this come about?
‘I’m glad that the state Legislature tied your hands’
‘I visited half a dozen buildings on or very close to the Boardwalk that have been converted, without permits, from long-term rental apartments to short-term rentals, or — yes — let’s call them what they really are: hotels’
Without permits. I have to get a permit to pour a tiny concrete slab. Let’s call this what it really is: corrupt, Silicon Valley snake-oil.
Just wait until sharing economy lobbyists bribe their politician supporters sufficiently to permit them to go all-in on self-driving ride share services. That is guaranteed to be an epic clusterf__k.
‘I visited half a dozen buildings on or very close to the Boardwalk. corrupt, Silicon Valley snake-oil ??
Just clarifying Ben….Venice Beach is in Southern California not Silicon Valley…
The toilet scrubbers are in Venice. These VC guys are getting schlonged too, they just haven’t figured it out yet.
“These VC guys are getting schlonged too, they just haven’t figured it out yet.”
Yep, just like Johnny Depp who one day woke up to find himself on the brink of bankruptcy and being eaten alive by his real estate. And even now it isn’t really real to him.
Same for the VC guys. Easy come, easy go. Drank their own drool-aid.
I’d like to add Nicolas Cage to your good examples, Palmy.
enjoy his early work but jeeeez is he ever churning out crap these days to make a buck after losing it all to his kiddie hobbies!
also Steven Seagal. pretty much an automatic “hell no” on anything in last 10 years. all cheesy horrible retreads.
(I’m a tough guy in my living room, alright. err, I meant up in the orbiting space station. yeah, that’s where I am . . . )
“corrupt, Silicon Valley snake-oil.”
All the while marginalizing upstanding citizens who dare complain - because these landlords are just your neighbors struggling to make ends meet! What are you, a hater or something?
Worse than the self-interested corruption is the strategy behind the sales pitch, fermenting the assumption that any opposition to [the sharing economy/loose lending standards/globalization/whatever] is rooted in a widespread and mean-spirited desire to see others fail.
After working so well in the political sphere, it has become corporate strategy to manufacture an artificial moral high ground in order to get a pass for breaking the law.
And once again we are sold the idea that because the globalized economy is a race to the bottom, we’ve got to be a taxi driver on the side, or have strangers in the house to pay rent. Here’s a study for you zillow: how many of these full time airbnbers are refinancing like crazy?
And while we’re on the topic, I resent the phrase “sharing economy”. If I give you half my sandwich, I’ve shared with you. If I offer to sell you half, that’s a business transaction.
“…sold the idea…”
Exactly. This insidious argument normalizes a falling standard of living while at the same time capitalizing on it to sideline critics. Those that have so far managed to escape the total impoverishment the sharing economy represents are portrayed as too privileged and out-of-touch to comment on what “less fortunate” people are forced to do to get by. Never mind that we are all collectively becoming “less fortunate” every day this is allowed to continue.
“Never mind that we are all collectively becoming ‘less fortunate’ every day….”
Indeed.
Airbnb = making profits by creating hotels that ignore health, fire, zoning, parking and safety regulations and do not pay hotel taxes.
That is Airbnb business model.
It really is that simple.
Here’s another defense: what about property rights? Uh, don’t the neighbors have property rights? Rights that were in place for decades before the internet existed?
That is zoning. No one wants a hotel in their residential neighborhood.
So it is zoned only for families.
Hilton could not build a hotel there. Airbnb thinks it is perfectly ok to create one there.
As long as they get their cut.
I am sure the CEO of Airbnb lives in a neighborhood that will never see an Airbnb rental.
Or a muslim refugee.
“Here’s another defense: what about property rights? Uh, don’t the neighbors have property rights? Rights that were in place for decades before the internet existed?”
I don’t know about other locales, but here in WA state the local counties peruse Airbnb, looking for people to go after for code violations, etc. They want their money, and they’re going to get it.
I have mixed feelings. I HATE the local governments and the county code, which is an assault on, and violation of, property rights, but I also don’t like business models which cheat and put legitimate businesses out of business.
It’s more than that.
‘Estimated 2016 Airbnb tax loss to states $260 million, says study’
https://www.digitaltrends.com/mobile/airbnb-tax-revenue-loss-states/
I’m sure these big operators are paying illegals to scrub the toilets. Some of these illegals are on public assistance, their kids in public schools. It’s just a big bunch of bogus all around.
It’s the less-government model of hospitality services.
No. It is the unequal application of the law.
A less government model would be to roll back health, fire, safety, parking and zoning laws for ALL hotels.
Let’s remember this isn’t new. I posted many reports back in 2005 or 6 or 7 about speculators using Craigslist to rent out shacks and airboxes short term. They would fight the city and usually got foreclosed. It was a big deal in Sedona where I lived at the time as there were a bunch of second houses, empty most of the time and lots of tourists. This kept up for a while and eventually the city had to crack down. The parties and beer cans everywhere were just too much. Why anyone thinks this can go on indefinitely is beyond me. After all these years, these places can’t build a few hotels? OK, rezone the houses and build a hotel. Oh no, that would be too much trouble!
It’s interesting that just about anything that makes housing more expensive either gets a pass or is promoted.
It is one of the the many obama legacies.
Ignore laws you don’t like and make up laws (EOs) you wished you had.
Obama got away with it for eight years.
And now many people think they can pull an obama.
Because it is the right thing to do…for them…
Because it is progressive and it is going to happen anyways…
“It’s interesting that just about anything that makes housing more expensive either gets a pass or is promoted.”
So just who is it that is there standing against making housing more expensive, more pricy? Current owners? Bahahahaha, such a joke: Current owners WANT housing to be more expensive, more pricy, because increased prices means increased equity which means increased wealth.
So how about future owners - aka buyers? Due these people want housing to become more expensive. Amazingly they do!
Increasing prices is the attraction. Take away the increasing price and you take away the attraction. It’s crazy to say this, but there it is.
So if it is not the current owners and it is not the buyers who are against the promotion of higher prices then who is it that is left?
https://www.inc.com/alex-moazed/cereal-obama-denver-the-recipe-these-airbnb-hustlers-used-to-launch-a-unicorn.html
Also:
‘Obama’s staff is taking over Silicon Valley’
August 11, 2016
‘Marantis served as the Acting U.S. Trade Representative and a member of President Obama’s cabinet, responsible for negotiating and enforcing international deals like the Trans-Pacific Partnership. But in 2013, Marantis left D.C. for sunny California and an executive role at Square (SQ), a payments company.’
“I didn’t know what to expect,” says Marantis, who wanted to try helping small businesses through technology rather than trade policies. “It was the beginning of the exodus of people from D.C. moving to the Bay Area.”
‘Marantis was one of the first Obama staffers to head west to be part of the tech scene. Since then, dozens of officials from all parts of the Obama administration have followed in his footsteps, including prominent figures like campaign manager David Plouffe (Uber), Environmental Protection Agency head Lisa Jackson (Apple (AAPL, Tech30)) and most recently Attorney General Eric Holder (Airbnb).’
‘There was a steady drip of employees bouncing between government and tech before Obama took office…But so many members of Obama’s administration have gone to San Francisco that one former political official now in the tech industry likened it to American expats hanging out in Paris after World War I.’
‘ etcalf and his peers from the administration had to learn to dress more like techies, trade D.C. jargon for tech speak like “disruption” and push for conversations about regulation and policy in an industry that cares more about building things fast.’
“We’re viewed as foreigners,” Metcalf says. “In startup culture, it’s like these regulations and all this stuff is just a burden.”
‘Yet, this group of foreigners is only growing larger. Tech companies are turning to people with political experience as they encounter more scrutiny over public safety, discrimination, privacy and regulatory issues from pushing into markets like ride-hailing, home rentals and banking.’
“It wasn’t a goal of mine,” says Nick Shapiro, former deputy chief of staff at the CIA who joined Airbnb in December to head crisis communications. “But time and time again you get hit up by companies in San Francisco who see what you’ve done in government and where you’ve been. They’re looking for people who understand the intersection of press, politics and policy.”
http://money.cnn.com/2016/08/11/technology/obama-staff-silicon-valley/index.html
‘Current owners WANT housing to be more expensive’
When I lived in Texas we saw higher valuations as a way to gouge us. I was paying something like 3% a year.
“When I lived in Texas we saw higher valuations as a way to gouge us.”
Yeah, but even though you thought you got gouged you also got allocated some nifty bragging rights. Plus you got some equity that you could cash out and spend as if there was no tomorrow.
‘Tech companies are turning to people with political experience as they encounter more scrutiny over public safety, discrimination, privacy and regulatory issues from pushing into markets like ride-hailing, home rentals and banking.’
‘It wasn’t a goal of mine,” says Nick Shapiro, former deputy chief of staff at the CIA who joined Airbnb in December to head crisis communications. “But time and time again you get hit up by companies in San Francisco who see what you’ve done in government and where you’ve been. They’re looking for people who understand the intersection of press, politics and policy.’
Nick here went out to San Francisco and volunteered to help smooth the intersection of press, politics and policy. Wait, did you get paid Nick? Just what “crisis” did you communicate about?
‘I’m glad that the state Legislature tied your hands’
This is so blatant, I don’t see how it isn’t a national disgrace.
“Nick here went out to San Francisco and volunteered to help smooth the intersection of press, politics and policy.”
Opportunity knocked.
“Wait, did you get paid Nick?”
Some very big bucks, I hope.
“Just what ‘crisis’ did you communicate about?”
A crisis that existed or a crisis that was manufactured, it matters not. It only matters that some big bucks can be made from it.
I’m going to apply for crisis communicator at Hilton. From the intertubes:
‘Crisis communication is a sub-specialty of the public relations profession that is designed to protect and defend an individual, company, or organization facing a public challenge to its reputation.’
My favorite crisis communicator is Luca Brasi.
push for conversations about regulation and policy
regulations and all this stuff is just a burden.
more scrutiny over public safety, discrimination, privacy and regulatory issues
intersection of press, politics and policy.
Lobbying for regulatory capture, plain and simple.
“This is so blatant, I don’t see how it isn’t a national disgrace.”
It is. It just doesn’t get reported as such, because crony-capitalism and intersectionality coalesced during Obama’s presidency, experienced by its participants as a golden age of progress.
I used to take the SF-DC flight pretty regularly during the Obama years and it was the most simpatico echo-chamber love-fest ever assembled on randomly-ticketed public transportation. Lobbyists chatted with tech PRs; Congressional aides with non-profit directors; entrepreneurs with federal agency regulators - all harmonious in ideology and congenial in methodology. For them it was Camelot 2.0.
“When I lived in Texas we saw higher valuations as a way to gouge us.”
Yeah, but even though you thought you got gouged you also got allocated some nifty bragging rights. Plus you got some equity that you could cash out and spend as if there was no tomorrow.
Once upon a time, no one bragged about increasing housing valuations. This may be hard to believe, but it’s true. I remember people in my neighborhood growing up fighting tooth and nail with the tax assessors whenever they tried to increase valuations. They bragged about being able to beat down the higher assessments, and this was in a very nice middle-class neighborhood.
Ben Jones:
‘Current owners WANT housing to be more expensive’
When I lived in Texas we saw higher valuations as a way to gouge us. I was paying something like 3% a year.
I was talking to a homeowner. He agreed with this - the net result of higher house prices for him was higher taxes. He said it wouldn’t do anything to help him get a nicer house as all the houses had appreciated as his had.
Higher house prices is a money printing press to the FIRE sector however.
County Judge and Commissioners get an Earful at Final Tax Rate Hearing
‘The Appraisal District raised White’s property value 66 percent since he purchased his house in 2011 and he was voicing the frustration many residents expressed at the hearing and around the state. ‘
‘Judge Floyd has presented a budget that requires a rate increase just as many residents have seen their property appraisals skyrocket. The complex issue of property tax valuation has legislators blaming local governments, local governments blaming appraisal districts and the comptroller and citizens blaming elected officials in general.’
‘Dove Creek resident Don Chavez said his appraisal went up 40 percent and he’s had to economize at home and at his San Angelo business. “I don’t know if I can sustain my business.” “I’m 73-years-old and there’s no way in hell I can afford to retire!”
http://sanangelolive.com/news/county/2017-08-19/county-judge-and-commissioners-get-earful-final-tax-rate-hearing
“I was paying something like 3% a year.”
Taxes like that should hold prices down.
Law enforcement = taxpayer-funded government services
‘William Glenn, a property owner in Warm Springs who uses VRBO, said he rented his property long-term from 1979 until 2013, and had a tenant trash the property before being forced to move out. After that, he said, he started listing his unit on VRBO and has had no damage to the property and only positive experiences renting it to short-term occupants. ‘I’m glad that the state Legislature tied your hands,’ he said. ‘I have no obligation to provide affordable housing.’
I’ve seen this referenced many times. Welcome to being a landlord Bill. I’m a landlord too. So if a tenant trashes a house, I can turn it into an RV lot or a car wash? Owning property comes with all kinds of strings. Where to put a trash can, how high the grass can be. But all of a sudden, it’s the wild wild west when it comes to THE INTERNET! It’s laughable to hear the most common defense: it’s inevitable! You can’t stop it. Especially with a bunch of high paid lawyers running around stuffing money in politicians pockets. Oh, and with all the free range attitude, they are losing money hand over fist.
And your neighbors are under no obligation to put up with a hotel in the neighborhood.
And the city is under no obligation to not fine you for ignoring health, safety, fire and zoning laws.
‘I’m glad that the state Legislature tied your hands,’ he said. ‘I have no obligation to provide affordable housing.’
Neither do I. But I can’t imagine imposing this crap on the people who live around the houses I manage. This greedy, inconsiderate bashtard is a perfect example of what this “tech” biz is all about.
I like it. I like the idea of having a house in a real nice neighborhood that I can rent out so as to make some big bucks.
Trying to rent out a house in a crappy neighborhood in order to make some big bucks is an idea that sort of sucks.
Nice is better than sucks.
If you were to think that the good neighbors that make up a good neighborhood add value to the rental that one has in this neighborhood and in effect subsidize the value of this rental then your thinking would be correct.
But it is also correct to think that the good neighbors add value to ALL of the houses in the neighborhood whether they are rentals or not. Which means, if one agrees with this point of view, it is not the HOUSES that determine the value of a neighborhood but instead it is the PEOPLE
(oooops)
… it is the PEOPLE who live in these houses that determine the value of a neighborhood.
“But I can’t imagine imposing this crap on the people who live around the houses I manage. This greedy, inconsiderate bashtard is a perfect example of what this “tech” biz is all about.”
What this is, is the breaking of agreements, which is all that laws are, really. Agreements that people ascribe to in order to have a somewhat functional, orderly society.
Thing is, these ‘tards want YOU to observe the laws and ordinances, etc., while they themselves do what they want. In fact their ability to get away with it depends on you being a good do-bee.
What’s to prevent a neighbor from hauling in, in the middle of the night, a rusted old hulk of an RV and dropping it in the street across the driveway? Or accidentally on purpose releasing a stream of sewage onto the neighbor’s property? Who is going to call the cops? The BNBers? That’d be an interesting neighborhood confab in the middle of the night.
Had an interesting conversation the other day with a guy who owns “investment” property in the local 55+ community. I’ve known him over the years as someone to speak to on a casual, social basis. When he first bought property back in 2008, he was very concerned about being respectful of his neighbors.
Now, not so much. I mentioned to him what I’d heard about the community banning rentals of less than 3 months. Whew, did I hit a nerve. He got a feral expression on his face and started proclaiming “Yeah, I’d like to see them try to enforce it! We’ve been using Air Bnb for years!”
Then he went on a tirade about a couple of realtors who are also investors in the same area as his property and their lack of maintenance of their investments.
Not sure what all this signifies, but it was interesting. This is someone who has always been on a friendly, even keel to speak with.
rusted old hulk of an RV and dropping it in the street across the driveway
Palmetto, you and Aquis will appreciate this story. I’ll admit that in the recent past I, um, acquired a new vehicle. I intend to sell my old vehicle privately in a couple of months, so at the moment I have two. To avoid the car driveway dance, I parked the old vehicle on the street. Since someone had parked a huge contractor truck in front of my house, I had to park two houses away.
This morning I went to drive the old vehicle somewhere, and found a note on the windshield that said “YOUR IN MY SPOT!” That was his grammar, not mine.
Priceless. My ‘hood has had 4-cars to a house and beaters and vans parked up and down this block since I moved in, and the one time I park for more than one day, I’m the one who gets the sign.
Oxide
I can relate to that parking story. I also bet your an easygoing sort of person that doesn’t like or need to be an unreasonable prick but when pushed too far you take care of bizness . . . es verdad!?
I’ve noticed it’s always the same greedy people who habitually take more than their fair share, but get pissy if OTHER people act the same way.
like the public street parking was HIS SPOT just because he often parked there. I’d personally wonder & grouse to myself if someone upset a routine but would try to see all sides for a balanced view.
however, I’m still just human and often offend. and will again tomorrow.
but I am also a loyal & fierce friend who will be there, not IF you need me, but WHEN you me.
“… it is the PEOPLE who live in these houses that determine the value of a neighborhood.”
Don’t forget that ‘All Real Estate Is Local’.
“Not sure what all this signifies”
‘Broken windows’ all over again, the toxic combination of two things that the sharing economy requires to exist: desperation and “everybody’s doing it.” 1) He can’t afford to get by without short-term. 2) Other investors don’t maintain their properties, so why should he?
PS. I’ve never heard of Airbnb in 55+ communities! Any details as to the how and why? Are the people he is renting to 55+ as well? Why would anyone rent short-term in a retirement community?? Is this a community that provides services/meals/amenities? Is this included in the “vacation”??
It sounds like a bad comedy - broke young people renting an AirBNB in a retirement home to get a budget version of a resort vacation with meals, fitness classes, book club and a swimming pool.
The 55+ community is in Florida and has a ton of fun in the sun amenities for older folks. I know there are a number of owners who rent on VRBO and HomeAway, I didn’t realize AirBnB was popular, too.
There have always been properties for rent seasonally, like January-March. It was never a problem. Some people rented the same places year after year. It was never a community for investors, but for retirees who wanted a nice but relatively modest place to live in their golden years. But it has changed and not for the better.
The big scandal in the area right now (not sure of all the details, much of it is rumor) is the guy who bought the old motel just outside the area that used to cater to visitors thinking of buying in the community, and family members visiting older relatives who live there. Apparently an EB-5 deal, or whatever that visa is where you have to spend at least half a million to buy the “American Dream”.
He remodeled the motel with garish painting on the outside and a blinking LED sign advertising low rates and cash deals and got a different clientele. Anyway, lots of rumors of drug deals, transient crime on the outskirts of the community, bed bugs and someone OD’ed in one of the rooms.
Thanks for the reply, very interesting. Puts a new spin on the sharing economy, beyond hip young ‘gig’ people to old folks renting out their retirement houses.
“It sounds like a bad comedy - broke young people renting an AirBNB in a retirement home to get a budget version of a resort vacation with meals, fitness classes, book club and a swimming pool.”
Why do you assume it’s only budget travelers that rent using AirBNB? I’ve rented some pretty nice houses over the years both on BnB and VRBO. Last one was on the Oregon coast and cost $300/night. Not quite broke young people territory.
‘on the Oregon coast and cost $300/night’
You got schlonged.
“the city”
Gubmint workers on the take…
Santa Ana, CA Housing Prices CRATER 5% YOY
http://www.movoto.com/santa-ana-ca/market-trends/
Are you planning to ride out the next market sh!t storm, or would you prefer to batten down the hatches? Given that the market is tanking despite the Fed’s clear signals of no more rate hikes in 2017 plus policy tightening measures at various other central banks, this one could be a real doozy.
7 signs the stock market is ready to run smack into a wall
By Mark DeCambre
Published: Aug 19, 2017 8:45 a.m. ET
Share
Russell 2000 turned negative for 2017, after falling below its 200-day moving average on Thursday
Reuters
Trump’s policy agenda is at risk.
The stock market’s relentless rally to records may soon be facing a key test.
A number of indicators point to a steady, halting deterioration of some of the factors that have helped Wall Street equities score a steady stream of all-time highs.
Peek beneath the hood of the action, and market technicians point to some unsightly problems within the market’s machinery.
Here are a few:
…
“Oakland Man Busted For Allegedly Running Brothel In Airbnb”
http://www.dailymail.co.uk/news/article-4658552/Prostitutes-hire-AirBnB-flats-turn-BROTHELS.html
AirheadBNB equals 2hr room rentals for hookers and johns. Anything illegal? Use AirheadBNB. And the empty pocketed home debtors in Californica established the trend. Washing sheets, disposing condom wrappers and cleaning toilets. Yep…. You’ve really come a long way California. The poorest state in America full of whorehouses.
What a disaster.
“What a disaster.”
You see disaster, I see opportunity.
http://sfist.com/2017/07/20/oakland_man_busted_for_allegedly_ru.php
How much you want to bet that Silly Valley is working on an app for this right now? You could easily set up a collaboration between tindr (or Ashley M),Uber, and AirBnB to arrange the hooker, the transport, and the venue. And delivery of snacks for afterwards.
Sometimes Craigslist real estate is fascinating to read. Remember when we used to post the Craigslist finds?
https://tampa.craigslist.org/pnl/apa/d/house-for-rent-more-info-read/6267106953.html
Any takers?
I’m glad you mentioned Craigslist: notice that 10 years ago when this exact same thing was being done there, hordes of highly paid Obama fixers weren’t pouring in to help. No local government hands were being tied. And there weren’t billions of dollars involved because CL doesn’t charge nor take a cut.
And here’s the newest tech unicorn way to sell your home:
https://www.offerpad.com/
I saw a sign on a house nearby today and had no idea what it was. Just a red sign with the word “Offerpad” and a phone #. So I decided to look it up. A little box opened up and someone wanted to chat with me, so I asked where were their listings. Oh, dear, turns out the site just isn’t quite up and running fully just yet. The chatter wanted to know what state I was looking in. For now, I’d have to call the phone # to find out what they were asking for the house.
The high tech way to sell your home using low tech. A telephone call! Where they’ll describe to you the home you’re interested in and what it costs.
But they’ve got a cool video with Mr. and Mrs. Cuck J. Cuckington.
Palmy
sounds like a telephone number harvesting front, like those fake RV ads on Craigslist harvesting emails/IM numbers.
tip-off is unrealistic selling price, a G-Mail address embedded in the photo & crazy verbiage in the ad.
Ya got a point there.
What I’m seeing is a narrowing of the gap between “legitimate” businesses and scam businesses, with the scam businesses trying to mimic the legitimate, and the legitimate (or quasi-legitimate) adopting scam tactics. It’s sort of interesting to watch.
“Any takers?”
http://picpaste.com/twins.jpg
I don’t often watch Max Keiser, but this report on corporate America cheering the increased mortality rate is interesting. And chilling.
https://www.youtube.com/watch?v=TEBhBkh4g_s&feature=youtu.be
American Holocaust.
I only watched the first part of that video, but the most chilling part wasn’t about the pensioners dying off from opioids. It was the assertion that private prisons lobbied for “three strikes” type laws specifically to target young people. It’s more profitable to put young people in prison because they are there for more years and thus generate more profit (courtesy US taxpayer) per head than older prisoners.
Seriously, is there ANY business model left that doesn’t rely on some form of government cheese as part of its revenue stream?
Fascism with a needle as the weapon
https://jonrappoport.wordpress.com/2017/08/18/vaccine-disasters-governments-want-you-to-forget/
Remember….. 3% down payment mortgages are subprime by definition.
The race to the bottom is in full swing.
As housing prices rise, lenders make buying easier
Andrew Khouri | Los Angeles Times
2:16 p.m. ET Aug. 10, 2017
LOS ANGELES — Home prices are rising across the country and mortgage rates, though still historically low, are up since the presidential election.
Simply put, buying a home isn’t easy, especially in high-cost metropolitan areas.
But changes in the mortgage industry are afoot, with the goal of loosening some of the strict standards established after the subprime crisis — rules some blame for impeding sales.
“The reality has sunk in that there are buyers out there who will be able to buy homes and make the mortgage payments,” said William E. Brown, the president of the National Association of Realtors. The industry is “trying to give them more options to buy a house.”
Government-controlled mortgage giants Fannie Mae and Freddie Mac are paving the way by rolling out new programs to encourage home ownership.
The companies, with their congressional mandate to promote home ownership, don’t originate loans, but they purchase mortgages from lenders to keep the market moving. And any changes they make in the underwriting standards for the loans they buy can have a big effect.
Also, lenders are moving to relax some standards partly because they fear losing business as home prices and mortgage rates rise, said Guy Cecala, publisher of Inside Mortgage Finance.
“If your business is going to drop 20 percent,” he said, “you need to come up with ways to offset that.”
The changes bring lending nowhere near the easy-money bonanza of last decade, which ended in financial crisis. But they have brought criticism from some corners that liberalizing rules for down payments and how much debt a borrower can have is a slippery slope that could eventually lead to another bubble.
“This is what happened last time,” said Edward Pinto, a fellow at the American Enterprise Institute, a conservative think tank.
Financing: During the bubble, borrowers could often put down nothing at all by financing the entire purchase.
After the crash, standards tightened considerably and federal regulators even floated a proposal to require 20 percent down for many mortgages.
For a low-down-payment option, borrowers usually had to turn to the Federal Housing Administration, which allows 3.5 percent down but requires costly mortgage insurance for the life of the loan.
Now, borrowers increasingly have more options, though generally they need a good credit score.
The trend started in late 2014 when Fannie Mae and Freddie Mac announced new programs that allowed loans with as little as 3 percent down. But many large banks still reeling from the housing bust that cost them billions were skeptical. Bank of America Chief Executive Brian Moynihan said his company was unlikely to participate.
“I don’t think there’s a big incentive for us to start to try to create more mortgage availability where the customers are susceptible to default,” he told a conference in 2014.
But less than two years later, the bank started offering 3 percent down loans through a partnership with Freddie Mac. Wells Fargo, the nation’s largest mortgage lender, also jumped in last year, partnering with Fannie Mae. JPMorgan Chase now offers 3 percent down loans as well.
“We are seeing more and more lenders adopting it every day,” said Danny Gardner, Freddie Mac’s vice president of affordable lending and access to credit.
The 3 percent down loans through Fannie or Freddie are capped at $424,100 in most of the country.
Bank of America launched its program with Freddie Mac after partnering with a nonprofit to provide financial counseling for the life of the loan, a spokesman said. After six months, BofA upped its annual origination cap from $500 million to $1 billion for the Affordable Loan Solution Program, which allows down payments as low as 3 percent.
Even lower: Some are going even lower.
This year, Fannie Mae started pilot programs with some non-bank lenders to offer loans with less than 3 percent down. The loans require the borrower to have 3 percent equity, but lenders gift borrowers money to meet the equity threshold as long as the borrower doesn’t eventually pay for it through higher fees or interest rates — which now average about 3.9 percent for a 30-year fixed loan.
Pilot programs with Guild Mortgage of San Diego and United Wholesale Mortgage of Michigan require the borrower to put down 1 percent of their own money. A pilot through Movement Mortgage allows a borrower to put down nothing.
Freddie Mac also allows 1 percent down loans with the lender making a 2 percent gift but announced last month it would bar the practice starting in November. Borrowers will still be able to put 1 percent down if they use money from family or government programs to reach 3 percent equity.
David Battany, Guild’s executive vice president of capital markets, said it launched its 1 percent down program to “address the down payment challenge, especially in California,” where real estate prices are particularly high. It was also struggling to compete with lenders that had previously launched very low down payment options.
“We were losing business,” Battany said.
…
Financing: During the bubble, borrowers could often put down nothing at all by financing the entire purchase.
So it was only about down payment. Not even a mention of the interest-only and neg-am loans, which allowed less-than full PITI monthly payments? How very convenient.
‘Not even a mention of the interest-only and neg-am loans, which allowed less-than full PITI monthly payments’
Over 90% of the foreclosures a few years ago were prime loans.
Ben, we’ve been down this road.
A $100K household can NOT afford the full PITI on a $700K mortgage, even if they have a “prime” FICO of 850. So, those Primes bought the $700K house with a neg-am monthly nut that they *could* afford… until it reset and payments doubled.
That’s why the Primes were the ones who defaulted. Either way, down payment is irrelevant.
Donk….. All the DebtDonkeys hauling the 3% down payment subprime mortgage can’t afford the shack either.
A distraction without a difference.
“Either way, down payment is irrelevant.”
Your misunderstanding of the relevance of downpayment is puzzling. What about loosening lending standards to qualify people with no savings to become homeowners don’t you understand?
I understand it just fine, bear. My point was that the 2005 bubble was due more to low monthly payment than to low down payments. Yes, those bubble buyers needed both, but the low down payment is irrelevant past the second month. It was the I/O and neg-am that kept people in houses for years.
“Once a borrower becomes a homeowner, Fannie will allow them to qualify for a cheaper cash-out refinance if they use it to pay off their high-interest student loans.”
Now if this isn’t a scam.
How about doing this in a “walk-away” state… then jingle.
The higher the prices go the closer to the top they get. The closer to the top they get the greater grows the risk.
In a world of common sense lending standards should tighten as risks rise, not loosen as they are doing now.
A world populated by dummies.
“’We were losing business,’ Battany said.”
What an ignorant lemming puke.
skyrocketing.mortgage.defaults.
Airbnb etc
I’m for property rights
Most folks traveling have some coin
Welcome aboard
Austin, TX Housing Prices Crater 7% YOY
http://www.movoto.com/austin-tx/market-trends/
Tech Insider
People are using Airbnb for hookups around the world — and the company isn’t happy about it
Business Insider UK
Sam Shead
Nov. 24, 2015, 6:41 AM
A small number of Airbnb customers appear to be using the service for hookups.
Airbnb is unlikely to endorse such behaviour, but some users told Business Insider they had slept with people or been hit on as a result of transactions that were facilitated through its platform.
Founded in 2008, the San Francisco-based company has an app and website that lets people rent out their rooms and properties for short stays to travellers in return for a 3% commission. The firm, which has helped thousands of homeowners supplement their income, encourages users to set a profile photo so people can see whom they’re about to stay with.
Airbnb rentals are often separate, wholly contained properties - like a flat or house where the guest stays alone. But many are simply rooms within the owner’s home. You’re essentially going to a stranger’s house and sleeping in a stranger’s bed. It’s supposed to be a purely financial transaction.
But sometimes one thing leads to another.
…
I recently had a conversation with Mr. Opportunity and Mr. Devious and both of them agreed that wiring up every room in the house with hidden cameras could possibly be very lucrative in the blackmail sense of the term.
I am looking forward to reading future reports of just how successful this idea will turn out to be.
It is indeed true that gross stupidity is a terrible thing to waste.
Mr. Money Moustache’s latest blog post features an airbnb success story and the comments didn’t go quite as expected… https://www.mrmoneymustache.com/2017/08/16/airbnb/
Mr. Money Moustache’s latest blog post features an airbnb success story and the comments didn’t go quite as expected… https://www.mrmoneymustache.com/2017/08/16/airbnb/
This is fantastic. Thanks for posting this. Love the comments.
The most telling comments were the ones by Mr. Money Mustache himself in response to “Neil” (about 2/3 of the way down the page):
It sounds like there is a balance to be had, but either end of the spectrum of options sounds too extreme for me. For example, suppose that rentals and visitors drive up local prices. Is this a bad thing? No, this is called “prosperity”…
So driving up local RE prices is prosperity. OK.
And then someone pointed out he is clueless about the effect of the RE bubble on low-income people and needs to maybe do some volunteer work with low-income people to get a clue, and here was his jaw-dropping response:
I disagree Tara – through my construction projects, I sometimes get to employ and work alongside exactly such people. These are guys who can barely hold it together long enough to make it out for a day’s work, and their paychecks (which must always be in cash because they don’t have bank accounts) go straight to booze and drugs that same night. And for those with a bit more luck, the money still gets burned, but on doodads for a pickup truck. But I still try to help and provide a role model and some good, healthy work and food.
I know the confusion and hardship they feel, and it must be really frustrating. But I think stuff like restricting vacation rentals is not what will solve the problem. A bigger safety net of well-paid life coaches and safe places to eat, sleep and learn might work better.