Investors Opted To Push Already High Values Up
A report from My Northwest in Washington. “Earlier this month, The Seattle Times reported that in 2017, nearly 90 percent of new housing in the city was built in 18 percent of land zoned for residential. The median price of a single-family home is now pushing $820,000. But there are steps being taken. In an effort to address the lack of affordable housing, Seattle Mayor Jenny Durkan announced a streamlined process to build backyard cottages — an effort that has long been stalled at city hall. Additionally, people who cannot afford a home may be relieved to hear apartments are being overbuilt and rent may soon be on the decline. In fact, Matthew Gardner, chief economist at Windermere Real Estate says the city is already seeing that. ‘We went from supply-demand balance to actually being oversupplied,’ he said.”
From KMBC News in Missouri. “A downtown Kansas City developer will soon learn if its proposed ‘Three Light’ project in downtown Kansas City will get another round of tax breaks. The Cordish Cos. is asking for a 25-year tax incentive to build its new 300-unit luxury high-rise apartment building. ‘If we are able to move forward on Wednesday, we plan to start the $130 million Three Light building in early 2019, bringing us to a total of more than 900 apartment units in the Power and Light district,’ said Nick Benjamin, Vice President of Development for The Cordish Companies. ‘Without incentive, new construction high-rise apartment buildings aren’t feasible in downtown Kansas City, even with substantial rent growth.’”
From WHO TV in Iowa. “Higher rise living space is planned for downtown Des Moines, including more than 500 rental units. The city says 200 of those should be available by 2022, but some residents say that’s a lot of homes to fill. ‘I think it’s crazy. I just don’t think there is any need for it, but that’s just my opinion,’ Des Moines resident Jodi Aldini-Zepeda said. ‘The apartments they do have, are they vacant or filled?’”
“According to Zillow, there are currently more than 200 units listed as vacant downtown.”
From News 5 Cleveland in Ohio. “The cost of new construction in the City of Cleveland continues to rise with several current projects advertising townhomes and brownstones for well over $400,000. This is in stark contrast to the average annual income of a family in the Cleveland-metro area, which the U.S. Census Bureau places at just over $52,000. ‘What we’re seeing here in the City of Cleveland in terms of new residential construction is the majority of the focus is on the very, very high end,’ said William Mahnic is an associate professor in the Business and Finance Department at Case Western Reserve University.”
From NBC Bay Area in California. “A couple turned their home into an illegal hotel where a party held by guests last year ended in a shootout that sent partygoers fleeing from rooftop to rooftop and terrified neighbors, a San Francisco official said. A lawsuit filed by City Attorney Dennis Herrera alleges Erik M. Rogers and his wife, Anshu Singh, unlawfully rented their Bernal Heights home through short-term rental websites for at least 319 nights between June 2016 and October 2017, sometimes charging more than $800 a night.”
“The couple, who spends most of the time in Bali, Indonesia, also illegally converted the home into two units, Herrera said. Police were called to the home in October 2017 after a party ended in a gunfight that left one person wounded and more than a dozen homes and cars pierced by bullets in the quiet, residential neighborhood. Neighbors told police the gunfire sent dozens of partygoers fleeing through rooftops and backyards.”
“‘In the middle of a housing crisis you have a couple who aren’t even living in the country turning a house into an illegal hotel for tourists and partiers,’ Herrera said. ‘This could have been a home that kept one more family in San Francisco. Instead, it brought a deluge of gunfire to a quiet neighborhood.’”
From AM New York. “As the city looks to build its way out of the costly housing market, one stretch on the western side of Manhattan — from 14th Street in Chelsea to Columbus Circle — has been the epicenter of this effort. That community district has added about 28,000 units of housing — double the number of new digs in any other neighborhood — between 2000 to 2016, according to a report. Yet the cranes seem to be largely catering to the highest earners — renters in new buildings in 2016 had median incomes almost one-third higher than all renters citywide, the report found.”
“And amid an era of great demand for more affordable accommodations, Chelsea and Hell’s Kitchen have seen more of their apartments go unused: the rental vacancy rate increased from 3.9 percent in 2010 to 6.6 percent in 2016, the report found.Jonathan Miller, president of the Miller Samuel appraising firm, said in the wake of the 2008 financial crisis, more investors opted to put money into real estate development — pushing already high land values up. That environment makes it difficult for projects to profit without targeting the more affluent end of the market, Miller said.”
“He described the city’s efforts as well-intentioned, but likely to add to the glut of luxury housing rising across the city without adding a significant amount of affordable homes. ‘Trickle-down housing policy doesn’t work,’ said Emily Goldstein, senior campaign organizer at the Association for Neighborhood and Housing Development advocacy group. ‘What we have in New York City at this point is a glut at the top end of the market that has not resulted in rents coming down or burdens being alleviated at the lower ends of the market. It’s resulted in high-vacancy at the top end of the market.’”
From the Democrat and Chronicle in New York. “The investigation into possible illegal acts within developer Robert Morgan’s real estate portfolio has moved quickly, leading to criminal charges alleging fraud to obtain $167.5 million in loans over six years, federal authorities said. But the indictment of four men — including the son and nephew of developer Robert ‘Bob’ Morgan — does not mean that the investigation is over, U.S. Attorney James P. Kennedy Jr. said at a news conference in Buffalo.”
“‘In this case, we noticed irregularities in the manner mortgages were obtained,’ Kennedy said. ‘That led to this investigation. We’re looking at everything.’ The criminal charges focus on seven properties in Buffalo, Syracuse, Avon, and Pennsylvania. ‘These seven properties are where we started and we’ll continue to investigate their properties,’ Kennedy said.”
“Todd and Kevin Morgan and two business associates — Frank Giacobbe and Patrick Ogiony — are accused of bank and wire fraud. Giacobbe and Ogiony are part of the Buffalo-based mortgage broker, Aurora Capital Advisors LLC. The charges allege that the foursome — Todd Morgan, 29, of Rochester and Kevin Morgan, 42, of Pittsford, along with Giacobbe, 43, of East Amherst, and Ogiony, 34, of Buffalo — conspired to provide lenders with falsified income data to help secure loans. They also allegedly staged vacant apartment units to dupe inspectors into thinking they were occupied.”
“They are accused in a 62-count indictment of conspiracy to commit wire fraud and bank fraud; wire fraud; and bank fraud. The alleged acts took place between March 2011 and June 2017 following an investigation that has been underway for the last 18 months, Kennedy said.”
“In a written statement released Wednesday afternoon, Robert Morgan said that ‘in light of recent events,’ his nephew and his son had been suspended from the company without pay. ‘Morgan Communities continues to cooperate with a federal investigation related to federally backed loans placed to several developers through a specific mortgage broker,’ the statement said. ‘We have been and continue to be current on all loan obligations.’”
“Federal authorities noted that the mortgages, some backed by federal lending entities Freddie Mac and Fannie Mae, were packaged into bundles and sold to investors — a practice that was central to the 2008 housing crash. The indictment alleges out-and-out fakery was involved when a Morgan limited liability company was seeking to refinance the project in the fall of 2014. A refinance of this sort typically involves combining several smaller loans into a single, larger obligation.”
“Giacobbe and possibly others created a fictitious $1.37 million loan and allegedly persuaded their lender, Arbor Commercial Mortgage, to roll that sum into the amount the Morgan company was refinancing, the indictment alleges. The indictment said Giacobbe ‘created and conspired to create’ paperwork related to the non-existent loan. Giacobbe is accused of pocketing $63,000 in broker’s fees from the $6.3 million transaction with Arbor. The indictment does not say what happened to the extra $1.37 million that Morgan company borrowed.”
“Other overt acts alleged in the 32-page indictment include faking paperwork and submitting inflated property appraisals to persuade lenders to provide bigger-than-needed loans, and at least one other instance in which a mortgage was allegedly fabricated to plump up a refinance.”
“Whether the indictment signals that lenders are falling down in their ability to spot fakery remains to be seen. It also remains to be seen if there are other instances in which investigators find evidence of exaggerated values and inflated loan amounts in Morgan’s property empire. There are plentiful examples of Morgan projects in which a property’s apparent market value is dwarfed by the size of the loans secured by that property.”
“The Democrat and Chronicle has examined public records for 31 Morgan developments in Monroe County. In all but one of those projects, mortgage loans exceed the assessed value of the property and are often 1½ to 2 times greater. Why loans exceed the apparent property value in so many cases is not clear.”
‘Whether the indictment signals that lenders are falling down in their ability to spot fakery remains to be seen…There are plentiful examples of Morgan projects in which a property’s apparent market value is dwarfed by the size of the loans secured by that property.’
Over 30,000 apartments potentially involved and still zero MSM coverage.
‘Other overt acts alleged in the 32-page indictment include faking paperwork and submitting inflated property appraisals’
Appraisers? Say it ain’t so! And note that this went on for years. We have the biggest apartment boom in 40 years, these guys are huge players, and they allegedly resorted to fraud. I wonder if there are any more out there?
‘Whether the indictment signals that lenders are falling down in their ability to spot fakery remains to be seen’
Hmmmm … let’s take a look at this:
1. If a property obtains a suitable appraisal then a lot of people get paid. If the appraisal is not suitable then these people do not get paid.
2. If a person makes his living doing appraisals then his appraisals must be “suitable” - suitable in such a way that a lot of people end up getting paid. If these people do not end up getting paid the demand for his appraisals will approach zero and thus he will starve.
If the decisive factor that determines whether a loan goes through or not - whether a lot of people get paid or not - is determined by the appraisal then there will be an ENORMOUS amount of pressure placed on the appraiser by a LOT of people who have a GREAT INTEREST in making sure that his appraisals are “suitable”.
This likely would not occur if the lender kept the loans he made but, as we can see, the lenders often do not keep the loans hence the incentives for acquiring accurate appraisals evaporate.
And these are refinancing loans. Which have been going through like crazy for years. I listen to these multi-family guys on the radio and they regularly brag about cashing out all their money (and then some) in 12 or 15 months. It has to “season” to qualify for GSE backing. I think it’s a year or two from purchase.
Today’s serial refinancer is tomorrow’s housing collapse victim and deserving bailout recipient.
And this guy votes Democrat, for certain!
We need a law where anyone who took a wad of cash out of their home’s escalating value cannot then claim to be underwater when values fall. They need to ride it out since they took the cash or just lose the house.
After the recent Bubble and Crash, no one has any excuse for not knowing that taking out money from the house when values are rising sharply is irresponsible. No one should get a bailout if they’ve done this. Also, no one should get a bailout if they took out a mortgage that is more than 3x the annual household income. I consider that a financial gamble and why should taxpayers support a gambler.
@animemama - Gamblers are considered financial heroes these days as they inject money into the consumer economy. Savers are to be “bent-over” with low interest rates by the cabal on Wall street whenever a bailout is needed. All you need to remember is that this is democracy with a “free market economy.”
3x annual income is 50% higher than long term trend of 2x.
“Appraisers? Say it ain’t so!”
Right? These “appraisals” aren’t appraisals at all and everyone knows it. There will be consequences to the appraisal disaster and it’s not going to be pleasant.
There will be “victims” of the appraisal disaster, just like the last time. And the next time. And the time after the next time.
There is no learning curve because the incentive for such a curve is non-existent.
Wasn’t there an article here a few months ago about people from India using Google Earth to appraise homes in the US? At least these appraisers live on the same continent.
Also, I’m from Rochester. My guess is one of these Morgan guys forgot to drop off an envelope at a bar, if you know what I mean.
January 22, 2018
From Mother Jones. “The Wall Street Journal reports that banks are getting tired of performing actual appraisals for high-volume home loans—the kind that get packaged into mortgage-based securities—and are turning instead to less rigorous broker price opinions: ‘Now these perfunctory valuations abound, underpinning tens of billions of dollars of home deals. Sometimes the process is outsourced to India, where companies charge real-estate agents a few dollars to come up with U.S. home values by consulting Google Earth and real-estate websites. BPOs have been used to value collateral in the more than $20 billion of bonds sold by institutional landlords, such as Blackstone’s Invitation Homes Inc., and in the fast-growing business of lending to individual house flippers.’”
“‘Their popularity,’ says the Journal, ’shows how Wall Street is finding ways to adapt to government efforts to crack down on some of the excesses that contributed to the housing crisis.’”
http://thehousingbubbleblog.com/?p=10321
Why bother with real appraisals when you can do fake appraisals at a higher valuation for much less, and generate the support for much larger government-sponsored, federally-guaranteed loans in the process?
I too am from Rochester. Moved away when I was a small child, and have never returned.
Friend of mi ne bought a house for $240k. The appraisal came in at….wait for it…. $240k. Not 239, not 241 but exactly the purchase price. What a crazy coincidence huh?
‘may be relieved to hear apartments are being overbuilt and rent may soon be on the decline. In fact, Matthew Gardner, chief economist at Windermere Real Estate says the city is already seeing that. ‘We went from supply-demand balance to actually being oversupplied’
Well that was sudden. Actually no. There were reports of half empty Seattle towers months ago.
but but but ….
they thought all these new amazon, google, facebook employees will rent the $3800 2 br luxury apartments …
SLU (south lake union) and belltown luxury buildings are taking a long time to fill. There are now options for new leases to get 2 months free.
What is interesting is that most of the ground floor on these buildings are retail space. Few of these are being filled up.
I was speaking with a satellite office in Tallahassee on Thursday. I had a conversation with a woman who was employed by a client. She and I do not know each other.
She went on and on about how much commercial space is being built in Tallahassee, remarking that there already is empty retail all over town.
“Alexia, what can I build that will get the me the maximum profit?”
“A 40 story tower in South Lake Union with luxury apartments under 950 square feet will generate the maximum profit per dollar spent.”
“Alexia, am I the first to ask this question?”
“No, this question has been asked one thousand, seven hundred twenty one times”
I know I’ve said it before, but it repeating. Of all those luxury apartments being built in Seattle, the vast majority were built to target the same small segment of people who represent the maximum ROI and least hassle, and are now effectively fighting over them.
All the rest of the people needing and wanting housing are way undeserved, especially new families and working class. So there’s both a glut of some types of housing and a shortage of others.
@MacBeth - that’s scary. Since the start of the decade, Tallahassee has gained about 9,500 people, or about 4,050 households per census data over last 8 years. In the last 4 years, only just over a thousand new households have been added there. Just 1.4% population growth. How the hell does that justify a commercial / retail building boom? Are investors just throwing cheap money at things hoping something will stick.
It will turn out to not be luxury. Just the run of the mill 2010’s bad taste crap.
Mercer Island, WA Housing Prices Crater 8% YOY As Efforts To Conceal Housing Correction Doubles
https://www.zillow.com/mercer-island-wa/home-values/
*Select price from dropdown menu on first chart
Efforts To Conceal Housing Correction’
That Seattle Times report is still AWOL.
Oh, you guys know this one is ALL my fault
Peak Poster Boy?
Naah. It’s the curse that’s been put on me.
Once I buy something, either the price crashes, or it is immediately discontinued and replaced by something much better. Never Fails.
https://www.zillow.com/ca-94062/home-values/
This is the upper market here in Redwood City,CA. We have companies like Facebook, Box and other smaller tech. Finally showing the market as a buyer’s market. I’m in Real Estate, and I’ve been waiting for this for 3 years. The market right now looks similar to what I saw back in mid 2007.
Market temperature
Cold
They are saying buyers market in Portland OR nowadays too.
Zillow Market Temperature here: Cool
“… home values have gone up 14.1% over the past year and Zillow predicts they will rise 9.4% within the next year.”
So sub-10% YoY price growth is considered cool? What would we call 9.4% wage growth then?
Had to LOL at a listing in that zip code - 2 bed 2 bath for 2M+. Built in 1931!!?! Property tax 14K/yr. I rent a 2 bed place (only 1 bath - sad panda face
for just over 1K/mo. Mountain views and a 5 minute walk/bike ride to “forever” ocean views as the realtwhores say.
Owners and the new buyer gonna have to run real hard on that hamster wheel. A monthly nut of 9Gs a month? Lots of sleepless nights for those bankster slaves!
Good for you, Green Eggs.
Freedom is a tremendous asset.
Crude Oil Crashes Through $70; $60 Floor Next Target
https://www.cnbc.com/amp/2018/05/25/oil-prices-are-plunging-as-russians-and-saudis-rethink-output-caps.html
There never was a shortage of oil any more than there was a shortage of housing.
Wow! The second AlbuquerqueDans’s ancient predicted price of $80/bbl was approached, the market started to crash. Ouch!
Trump talked to the Saudis, it was becoming a political issue with the Democrats blaming it on his Iran policy. One day does not make a bear market. We did not approach $80 we actually passed it briefly. Brent crude is the real marker. The Saudis and the Russians are the only ones left with any spare capacity. Once they use that any further increase in demand will have to met with increase prices.
“$60 floor”
…. And no bottom in sight with a globe full of crude and more produced every day.
Above was just my opinion but it did not take long to find someone with the same opinion:
https://www.rigzone.com/news/wire/under_pressure_from_trump_saudis_put_brakes_on_oils_rally-25-may-2018-155742-article/
crushing.housing.losses.
Hi folks, it’s been a while, some names have changed, and I haven’t been following regularly, but I have ask:
Has anyone seen anything like this article?
https://www.zerohedge.com/news/2018-05-26/end-stimulus-and-start-crash
Pretty ominous I think, but is it the truth?
“At that time you’ll need to run, not walk, to buy anything with intrin$ic value that can’t be inflated away — before your currency becomes worthle$$.”
pirate$ to the right, pirate$ to the left, some are kidnappin’ $washbucklers, … some just wear expen$ive $uits
NY Post May 23 2018 Lisa Eustachewich
Buccaneers are running amok in the Caribbean and Latin America, according to a disturbing new report Wednesday that found a staggering surge in pirate attacks last year.
Seventy-one pirate attacks were recorded in Latin America and the Caribbean in 2017 — a 163 percent increase from the year before, according to the nonprofit group Oceans Beyond Piracy, which found that 59 percent of the incidents involved robberies on yachts.
But there were 21 kidnap-for-ransom incidents in 2017, three more than 2016. One hundred crew members were taken hostage and two were killed.
“Kidnap-for-ransom continues to plague the region, which is a trend that has unfortunately continued from 2016,” Pigeon said.
(Whom has the Central Banker$ kidnapped & i$ holding ho$tage?, … Oh, the “Indemnified’s” fear the puni$hments that will bee visited upon their person’$”! )
Well, that explains why global warming is in a “pause.”
This “pause” should be “adjusted”.
“If we’ve been in “recovery” for years now, as the central banks have been touting, then why has 2016-2108 seen the most stimulus ever injected into the system?
History has taught us that we should trust or leaders’ actions far more than their words. And their actions at this time indicate panic.
What is it that has them so worried? We should all ponder that question long and hard. I’m convinced that they know as well as we do that, once the over-inflated ““markets”” created by the central banks can no longer be sustained at their current nose-bleed heights, the damage will be extraordinary and unstoppable.”
I agree with this writer. I don’t believe any of the central bankers believe the garbage they’re feeding the public, they’re just desperate to maintain the facade. They see all of the bubbles they’ve blown, they just pretend they don’t.
When it becomes undeniable, they start spewing forth little snippets like “some froth” as Greenscum called it, or “subprime is contained” in the case of The Bernanke, but they are well aware of the damage they have wrought. It’s no surprise - or accident - that they, and all of their buddies, are the benefactors, either.
The real question is “do they have the balls to actually do the right thing at some point?” My guess is no - they will go Weimar Republic before they will allow the whole sh!thouse of their own making to come crumbling down.
Juno Beach, FL Housing Prices Crater 5% YOY As Speculators Flood Coastal Property Market With Inventory
https://www.movoto.com/juno-beach-fl/market-trends/
One problem somewhat unique to Washington State is the Condominium Law which grants so many protections to buyers and opens up so much future liability to developers that no one is actually building condominium towers anymore in WA despite the fact that a large number of would-be buyers would actually prefer to buy high-rise condo units in Seattle rather than single family houses:
http://www.seattlemag.com/news-and-features/condo-conundrum-10-reasons-why-theres-sale-shortage-seattle
So you have single family homes in the suburbs and apartment towers in the central city and nothing inbetween.
Are you missing the rally in Treasurys and German bonds, thanks to having all your monies tied up in housing?
30-year U.S. government bond yield posts largest weekly drop in nearly two years
Published: May 25, 2018 2:56 p.m. ET
Dovish Fed minutes and uncertainty over Italy’s new government drove demand for Treasurys
By Sunny Oh
Treasury prices rose on Friday, pushing yields lower, as lingering concerns over the composition of the new Italian government helped stoke appetite for U.S. government paper and other haven assets.
Overall, Treasurys rallied for the week following a dovish set of minutes from the Federal Reserve that saw investors cut back their expectations for a more aggressive rate increase trajectory.
The U.S. bond market closed early Friday at 2 p.m. Eastern and will remain shut on Monday for the Memorial Day holiday.
The 30-year bond yield (TMUBMUSD30Y, -1.10%) slipped 3.8 basis points to 3.098%, contributing to a weekly drop of 11.8 basis points, the largest since July 2016.
The 10-year Treasury note yield (TMUBMUSD10Y, -1.66%) fell 4.9 basis points to 2.931%, extending a weekly drop of 13.6 basis points, the largest such decline since April 2017.
The 2-year note yield (TMUBMUSD02Y, -1.90%) was down 3.2 basis points to 2.480%, and 6.8 basis points for the week. This was the largest weekly decline since Feb. 9.
The German 10-year government bond yield (TMBMKDE-10Y, -14.34%) fell 6.1 basis points to 0.405%, while the Italian 10-year bond yield (TMBMKIT-10Y, +6.37%) jumped 5.5 basis points to 2.452%, widening the yield gap between the two bonds by 11.6 basis points to 205 basis points.
Bond prices move in the opposite direction of yields
…
“In an effort to address the lack of affordable housing, Seattle Mayor Jenny Durkan announced a streamlined process to build backyard cottages — an effort that has long been stalled at city hall.”
Look for these to show up as AirBnB rentals rather than long-term housing for low income renters. Fail.
Policy makers keep trying to attack this problem from the supply side rather than the demand side, and all they’re doing is driving up demand even more. And yet they scratch their heads.
“affordable housing” vs. “conspicuous consumption”. What a dilemma for policy planners!
Vancouver (BC) is leading the way on backyard cottages. They are called “laneway homes” and they are all over YouTube if you want to take a closer look. They cost $250K for a 1/1 tiny house. Heh.
Very Interesting. At 500 to 1000 sq/ft that’s a good bit bigger than I was expecting. It looks many of those in Vancouver come at the expense of detached garages. As long as everyone doesn’t need a car, I guess it’ll turn out ok.
I really like laneway houses. IMO 500-700 sq ft is a perfect size. There’s still enough room for two cars on the property, just not in a garage.
“In landmark compromise deal reached with Kshama Sawant and the rest of the city counsel, Mayor Durkan announced ‘we are killing 2 birds with one stone’ and that new law would not only require homeowners to build backyard cottages, but to make them available to the first qualified homeless person that asked, regardless of criminal or drug history”
Farfetched? or Likely?
Depends on what a “qualified” homeless person means.
Wow. I assumed qualified meant NO crim or drug history for sure. Are they going to use credit scores?
Wow. I assumed qualified meant NO crime or drug history for sure. Are they going to use credit scores?
I take it you’ve seen the recent laws the City of Seattle passed then. It’s really pushing the mom and pop landlords to sell out and move on.
Aint socialism awesome?
Quite likely. If not this, then something else.
Socialized housing (and I don’t mean Section
could very well happen.
Massive disparities in wealth via Keynesian economics is the perfect set up.
Seattle, WA 98121 Rental Rates Crater 9% YOY As Spec Housing Floods Market
https://www.zillow.com/seattle-wa-98121/home-values/
*Select price from dropdown menu on rental chart
If your construction loan is 25% over your construction cost what will stop developers?
asking for a 25-year tax incentive to build its new 300-unit luxury high-rise apartment building
Prediction: the developer will sweeten the deal by making 30 (10%) of the units “affordable” studios (at $1800 instead of $2700) in order to secure the tax breaks. If I were the city council I’d tell them to pound sand.
Donk,
“Developers” sweeten the pot by passing brown envelopes to decision makers. It’s the primary reason the US is in this mess.
Ah, but they are the best decision makers that money can buy.
Too bad, so sad, for Californians with expensive homes. The silver lining: This tax law change should take some of the air out of the California Housing Bubble, and help make homes more affordable for people who just want a place in which to live.
Tax breaks for home mortgages to sink 30% in 2018 due to Trump tax law, study shows
Published: May 26, 2018 3:46 p.m. ET
Most Americans unaffected - except those with expensive homes
By Jeffry Bartash
Reporter
Shutterstock
Owners of expensive homes won’t save as much from the mortgage deduction after the Trump tax law.
One of the most cherished tax breaks in America, deducting the interest on a home mortgage, is going to get whacked down to size in the next few years.
Fortunately most Americans won’t really notice.
A group of congressional tax experts predict claims for mortgage deductions will fall 30% in 2018 — to $40.7 billion from $66.4 billion in the year before the Trump tax cuts took effect. Claims will decline even further to $34 billion in 2019.
…
Mortgage rates march to fresh 7-year high
Published: May 25, 2018 9:08 a.m. ET
So far this year, the 30-year fixed-rate mortgage has averaged 4.38%.
Getty Images
Buying, selling, refinancing - and moving - could all take a step back if rates surge too high.
By Andrea Riquier
Rates for home loans throttled higher, nipping at the heels of a housing market that’s so far managed to absorb pricier financing on top of surging home prices.
The 30-year fixed-rate mortgage averaged 4.66% in the week ending May 24, mortgage finance provider Freddie Mac said Thursday, a jump of five basis points during the week.
The 15-year fixed-rate mortgage averaged 4.15%, up from 4.08%. The 5-year Treasury-indexed hybrid adjustable-rate averaged 3.87%, up five basis points.
…
Fantastic news: The Trump tax law changes may offer the prospect for the Democrats to finally achieve their affordable housing goals!
Home prices will fall 10% if state and local deduction taken away, Democrats say
Published: Oct 26, 2017 1:49 p.m. ET
How will the housing market respond?
Will neutering the mortgage interest deduction wallop the housing market?
By Andrea Riquier
The tax reform effort, whose chances for enactment have increased due to the budget passed by the House of Representatives Thursday, could reduce house prices by 10%, according to top Democrats.
Worries over the impact of the elimination of the state and local tax deduction prompted Republicans in New York and New Jersey to vote against the budget on Thursday.
Senate Minority Leader Chuck Schumer and House Minority Leader Nancy Pelosi cited a study released earlier this year by the National Association of Realtors in saying that prices could drop by 10%.
…
None of this happens in a vacuum.
The removal of deductions, hiking of loan rates, turning off the money presses at the central banks, etc. It’s a volatile combination of factors. There’s always chance of the unexpected mixture at a given moment exceeds ‘the safeguards’ and the whole things catches fire. “We never saw it coming” they all will say…
“… that prices could drop by 10%”
Eye’m rooting for 11.756% 30yr mortgage rate$, way better price reduction$ oppoortunitie$ !
I’d love it. Unfortunately, I think we’d see negative interest rates before they’d ever allow that. It’s Weimar or bust for this set of cR0oKed central bankers.
“Home prices will fall 10% if state and local deduction taken away”
And we know that nothing accelerates the economy and creates jobs like falling prices to dramatically lower and more affordable levels. Nothing.
Why would Democrats be against such a positive outcome?
More Trump winning:
https://chinaeconomicreview.com/china-plans-tariff-cuts-for-up-to-200-consumer-goods/
Pullman, WA Housing Prices Crater 11% YOY As State Economy Slows
https://www.movoto.com/pullman-wa/market-trends/
Sympathy I have for the San Fran party house neighbors: zero point zero.
595 sq ft shack in California going for … drum roll please…$1 million
I get it that property near the beach is worth more than say a comparable shack in hot, smoggy and VERY far from the beach San Bernardino, but that price seems a bit on the loony side.
A surprise performance of Ravel’s Bolero stuns shoppers!
https://www.youtube.com/watch?v=ILNDWCLVnpw
That’s a great selection to perform that way, because of how the different instruments gradually enter over the course of the piece.
A funny fact about Bolero is that Ravel wrote it as a demonstration piece to show off the various different instrumental colors in an orchestra, not conceiving it as a serious concert piece. It turned out to be his most popular work. And works very well in a mall setting, apparently.
The marching band one-ups with LMFAO’s Party Rock!
https://www.youtube.com/watch?v=WlG2xN4ef3Y
“There Are 101 Americans With Over $1 Million In Student Loans”
Bahahahahahahahahahahahahahahahahahaha.
“Astronomically high college tuition facilitated by a bottomless ocean of student loans has saddled Americans with a record $1.48 trillion in non-dischargeable debt - an amount which has more than doubled since the 2009 lows.”
Banahahahahahahahahahahahahahahahahahaha.
“As we reported in January, nearly 40% of student loans taken out in 2004 are projected to default by 2023 according to the Brookings institute.”
Say WHAT? This is an outrage! These pukes should pay what they owe. All pukes should pay what they owe.
https://www.zerohedge.com/news/2018-05-26/there-are-101-americans-over-1-million-student-loans
I still say return and cancel the degree. Unions, state, local, federal jobs require you to have a degree and you will never be able to even apply for them.
Companies government would be able to fire you legally for not having a valid degree and there would be no recourse in suing. Unless companies put themselves in one where they fire you, but not the bosses bruddah in-law who also ditched his loans.
Give up on your dreams be debt free and make your new career at staRmucks.
About 12 years ago my kid’s dentist asked me to bring 1 of my 3 kids to an Orthodontist to see if she needed braces or not (the other 2 were perfect).
The appointment was on a Saturday morning so I ended up bringing all three. When I got there I explained to the receptionist which one was to be looked at and told her I was going to stand outside the front door for 5 minutes and make a business call.
When I stepped back inside the door all 3 kids were gone. Five minutes later the Orthodontist’s assistant came out with 3 charts and started explaining to me that all three needed braces for $6k+.
Upon further review another Orthodontist took care of the 1 kid.
“After graduating from Brigham Young University with no debt and a new marriage, Meru borrowed $601,506 debt to attend USC’s orthodontics program - while his new wife Melissa finding work as a USC administrative assistant to save on tuition. After a few years, his student loan had swelled to $1,060,94.”
In California you are considered a “financially dependent” child of your parents until age 30 (unless married) for the University’s financial aid regarding bachelor and masters programs. In other words, your parents will be co-signing those student loans.
In medical school there is no age limit or marriage exclusion, i.e., unless you are absolutely dead broke poor or fantastically wealthy, your parent’s financial resources will be commingled in the student’s eligibility calculation. Many medical doctor’s serve in the armed forces in combat zone emergency trauma surgical units saving wounded soldiers and receive very generous student loan assistance.
Las Vega, NV 89109 Housing Prices Crater 10% YOY
https://www.zillow.com/las-vegas-nv-89109/home-values/
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