June 9, 2018

Propping Up The Global Economic System

A weekend topic starting with Bisnow. “Someone at the International Monetary Fund has been thinking about chaos theory. Specifically the butterfly effect, the name for the branch of chaos theory which argues that a butterfly flapping its wings in one part of the world can be the very tiny incident that builds up to a hurricane on the other side of the globe. The IMF took this principle and applied it to global housing markets. Since the financial crash, global housing markets have become more synchronised: prices and the way they move have become more and more correlated, particularly in major gateway cities. A combination of low interest rate policies around the world, improved economic growth and the increasing importance of global capital has caused this alignment.”

“These conditions are even more true in the commercial real estate world, where there are fewer properties and global capital plays an even greater role. The problem with this situation, according to the IMF, is that it makes downturns harder to contain — if one market experiences a sharp correction, other correlated markets are likely to experience the same fate. Might a butterfly flapping its wings in Midtown Manhattan herald bad news in London’s West End or La Defense in Paris?”

From Think Realty. “Renters are getting more bang for their buck these days due to an increase in rental concessions. According to a report from CoStar, an increasing number of developers are offering concessions to new and renewing residents in order to keep occupancy up. Lynn Bora, vice president of operations at Winn Companies, a firm managing nearly 100,000 apartments across the country, observed, ‘Concessions are back with a vengeance.’ There is a growing glut of high-end and mid-level multifamily housing. Some cities, like Nashville, are seeing 30% increases apartment inventory.”

From the Daily Gazette in New York. “Local experts expect the long-running apartment construction boom in the Capital Region to start tapering off. Until recently, Sunrise President Jesse Holland said as an illustration, Sunrise didn’t offer two-year leases because one-year leases increase the tenant turnover rate, and every turnover is a chance to raise the rent. Now, he said, Sunrise sees two-year leases as a way to retain tenants and maintain high occupancy. Other companies, he said, have gone as far as offering two or three months’ free rent to attract new tenants.”

“SEFCU Commercial Banking Vice President Ed Jennings said lenders are not financing apartment projects as freely as they once did. ‘Where is the saturation point in the multifamily market?’ he asked. ‘I think the lenders are looking at that very closely.’”

From The Real Deal on New York. “Concessions hit record highs in Brooklyn and Queens in April, per Douglas Elliman, with 65.1 percent of new deals in Northwest Queens including them and 51 percent of new deals in Brooklyn including them — marking the first time the borough has cracked the 50 percent mark. In Manhattan, 44.3 percent of new leases in April included concessions. These unprecedented highs could lead to changes in what landlords decide to offer on lease renewals going forward, according to sources.”

“In previous cycles, many New York City landlords would knock off concessions and jack up rent once the initial lease ended. ‘That free rent may come into play on second-generation leases where the tenants decide to stay, and even if it goes back on the market, they’re probably going to be giving a month free at least,’ said Elliman broker Matthew Villetto. ‘You do have situations where a landlord would give a concession to keep someone in the building. It comes down to the math,’ said Citi Habitats’ David Maundrell.”

From Bisnow on Georgia. “The Vue is the latest in new apartment projects being announced in Atlanta and is part of a group of developments still taking the chance on the metro area’s renter appetite for new apartments. Over the next 12 months, more than 8,000 units are slated to hit the market, representing a ‘high water-mark for in-town deliveries,’ Haddow & Co. recently stated in a report. Since 2015, some 19,000 new apartment units delivered in Atlanta. This glut of new apartments is having its toll on rents. According to Haddow, developers are having to sweeten concession packages to attract renters. Rents at high-rise apartments fell nearly 5% from a year ago to $2.30/SF, and the average number of new units getting snapped up by renters also dropped to 15 per month from 20 per month in 2017.”

From Bloomberg. “Park West, a 3,400-bed student housing complex near the Texas A&M University campus in College Station has a resort-style rooftop pool, three gyms and lounges with billiard tables, ping pong and flat screen televisions. What it doesn’t have are students — or rather their parents — willing or able to pay as much as $1,000 a month to live there. Just over half the beds at the complex, financed largely by tax-exempt municipal bonds, were filled during the last academic year.”

“About 360 miles (580 kilometers) north in Norman, Oklahoma, a 1,230-bed residence hall at the University of Oklahoma featuring a ‘blow dry bar and salon,’ a market with grass-fed local meats, and a cycling studio is just 26 percent leased, according to a securities filing. It opens in August. ‘We have seen some projects go through a little bit of stress,’ said Jessica Matsumori, an analyst at S&P Global Ratings. S&P has rated about 60 privatized municipal student-housing deals, most of them BBB-, the lowest investment grade.”

“Few restrictions apply to tax-exempt financings by non-profit entities, said Mark Scott, a former head of the U.S. Internal Revenue Service’s Tax-Exempt Bond Office. ‘The real question is why an entity that builds luxury apartments is entitled to non-profit status,’ he said. Park West only rented 54 percent of beds in the fall semester and 52 percent in the spring, according to S&P. Management told S&P the market study didn’t capture all the new housing supply coming on line in the area surrounding the campus. S&P downgraded the bonds eight levels to CCC in December.”

From the Commercial Observer. “Ask a dozen multifamily experts what should become of Fannie Mae and Freddie Mac, the public-private corporations that guarantee American residential mortgages, and you’re likely to hear three dozen suggestions. But the one thing everyone can agree on is that no one expected the so-called government-sponsored entities (GSEs) to still be where they are today.”

“The federal government had no choice but to intervene to save a modicum of liquidity in residential finance markets, seizing control of the GSEs and injecting hundreds of billions of dollars to rescue them. It was never supposed to last. Willy Walker, who in his role as CEO of Walker & Dunlop leads the company that’s the biggest contributor to Fannie Mae multifamily mortgages and the third-biggest to Freddie Mac’s, knows all too well that conservatorship was never meant to be a permanent solution.”

“‘We have to keep in mind the fact that Fannie Mae and Freddie Mac [were put] into conservatorship to prop up the global economic system,’ rather than for reasons inherent to their own operations, Walker said. ‘The idea that anyone had any vision about what they would be in the future [is false].’”

“Fannie Mae and Freddie Mac don’t originate their own loans. Instead, they buy them from banks and other lenders, package them for sale in the commercial and residential mortgage-backed securities markets and make an implicit guarantee to investors in the case of defaults. Given how important the agencies’ operations are to multifamily markets, it’s no surprise Walker is frustrated with the lack of progress in reorganizing them.”

“‘All the proposals [to reorganize the GSEs] are way too complicated,’ he said, noting that only a few debt markets, such as the trade in U.S. Treasurys, are larger. ‘You can’t draft legislation that will allow you to get everyone around the table to agree if you are trying to wholly change [one of the] largest bond markets in the world.’”

“The inertia over what to do with the giant institutions might be less severe if the agencies weren’t so central to U.S. housing markets—or, if the government’s conservatorship had been less lucrative. Combined, the agencies provided about $1 trillion in liquidity to mortgage markets last year, financing millions of apartment units and even more single-family homes along the way.”

“The most vocal proponents of banishing the government guarantee in the housing markets entirely, a think tank at the American Enterprise Institute (AEI) led by Peter Wallison and Edward Pinto, argue that by extending affordable credit to some marginal housing buyers who’d otherwise be shut out of housing markets, Fannie and Freddie’s role has been to accelerate the cost of low-income housing, contributing to a perpetual seller’s market that leads to constant instability: booms and busts.”

“The GSE’s ‘effort to make housing more affordable…actually makes housing more expensive, because you haven’t solved the supply-demand imbalance,’ Pinto said. ‘Now, we’re [more than five years] into a seller’s market, and we’re getting the exact same response from the market’ as before the financial crisis, with rising prices for low-tier housing.”

“The trouble, according to economist Mark Zandi, is that during the steady economic expansion of the late 2010s, there’s been little impetus to shake up a system that has extended as-yet untested credit to residential borrowers and returned billions of dollars to taxpayers. ‘The main sticking point is that the system works,’ Zandi said. ‘You’re not happy with the pipes, but the water’s flowing. Do you really want to change the plumbing?’”

From the Democrat and Chronicle. “The current criminal case alleging wrongdoing by relatives of area developer Robert Morgan has led to many questions about the criminal charges and the possible impact locally. In all, authorities allege that hoodwinked lenders provided loans totaling $167.5 million for seven different properties. The alleged skulduggery included inflating the value of apartment projects with falsified information about how many people resided there. In some cases, prosecutors say, the alleged conspirators submitted fake documentation to property appraisers, convincing the appraisers that apartments were significantly more valuable than they really were. Those appraisals then became the centerpiece of loan requests.”

“In two cases, Giacobbe and others allegedly conjured up fictitious loans — one for $3.5 million, the other for $1.4 million — and persuaded lenders to roll those sums into the amounts the Morgan company was refinancing. In another case, in December 2016 Frank Giacobbe, a Buffalo-based mortgage broker, allegedly told a lender for a Pittsburgh property that the apartments were more than 95 percent occupied. Three months later an employee of the complex, unaware of the earlier claims, sent an accurate report to the lender that showed less than 70 percent of the complex was occupied.”

“Debt outstripped assessed value for all but one of 40 Morgan projects or purchases in the Rochester area examined by the Democrat and Chronicle, suggesting the properties were mortgaged for more than they were worth. In some cases, the debt was more than double the assessed value.”




RSS feed

56 Comments »

Comment by Mortgage Watch
2018-06-09 08:23:21

Flagler Beach, FL Housing Prices Collapse 15% YOY As Speculators Flee Coastal Property Markets

https://www.movoto.com/flagler-beach-fl/market-trends/

 
Comment by Ben Jones
2018-06-09 08:38:36

‘Ed Jennings said lenders are not financing apartment projects as freely as they once did. ‘Where is the saturation point in the multifamily market?’ he asked.’Gee, I dunno Ed, maybe a couple or three years ago? Such penetrating questions from a lender like yourself is why you make the big bucks! I’m reassured our global financial system rests on the knowing minds of people like yourself.

‘Park West only rented 54 percent of beds in the fall semester and 52 percent in the spring, according to S&P. Management told S&P the market study didn’t capture all the new housing supply coming on line in the area surrounding the campus. S&P downgraded the bonds eight levels to CCC in December’

Hey Bloomberg, starting to get a sense of the carnage? It does pay to follow the HBB. I’m only like 3 or 4 years ahead of you.

Comment by Mafia Blocks
2018-06-09 08:55:08

College Station? We’ve seen how the oil bust has ravaged oil states.

College Station, TX Housing Prices Crater 16% YOY

https://www.zillow.com/college-station-tx/home-values/

…. don’t forget to select price from dropdown menu. ;)

Comment by Ben Jones
2018-06-09 09:23:50

You need to drive through west Texas. I did it twice last year on the ground and three times by air. It’s a freaking boom like you’ve never seen. Yes places like Eagle Ford are in the dumps, but in the Permian they are making money hand over fist above $40 a barrel.

Also, there’s no oil to speak of in DFW or College Station and certainly not Austin, where foreclosures just shot up 30%. These busts or soon to be busts are purely real estate in nature.

Comment by Ben Jones
2018-06-09 09:50:42

May 30, 2018

From Realtor.com. “College Station is best known as the home of Texas A&M University and more than 68,000 students. But these Aggie football fans got a little carried away on their latest housing boom, putting up too many new residences. As a result there are more homes for sale than buyers to scoop them up. Hence, the discounts. ‘To be blunt, the housing market is crashing right now,’ says Jeff Leatherwood, a broker at Aggieland Properties. ‘Properties built for the purposes of student housing are just overbuilt. We are a huge college town, and most of our market is rental properties.’”

“This overabundance of housing, particularly homes aimed at students, could get worse before it gets better, local professionals fear. ‘There is an air of doom and gloom,’ Leatherwood says. ‘When the school year starts again in September, homes [that didn't get student renters] will flood the market.’”

http://thehousingbubbleblog.com/?p=10448

(Comments wont nest below this level)
 
Comment by ibbots
2018-06-09 10:57:50
(Comments wont nest below this level)
Comment by Ben Jones
2018-06-09 11:00:31

Not only that, you would have your choice of dozens of jobs. The shale biz has moved into Oklahoma in a major way too.

 
Comment by b
2018-06-09 12:11:24

So what is the problem with taking the shale field money, renting and then when the next downturn happens —- leave town.

Why would you pay $$$$$$s for a house in a boom/bust industry

 
Comment by In Colorado
2018-06-09 12:34:57

Aren’t rentals typically in short supply in boom towns?

 
Comment by goedeck
2018-06-09 13:40:11

The Permian: it’s different this time.

 
Comment by Albuquerquedan
2018-06-10 07:50:25

“Ya, $140k / yr for anyone with a CDL who can pass a drug test.”

Or you can work for Bezos’ Amazon in the new economy. I shop at Costco and am willing to drive instead of being a Sam’s club member and a major reason for it was how Walmart treated its employees. However the hypocrisy of the left is amazing after attacking Walmart at every turn, Amazon gets a pass. Many of it employees are on food stamps but it is not a major issue for the left.

https://www.cheatsheet.com/culture/workers-at-this-big-american-company-are-some-of-the-people-on-food-stamps.html/?ref=YF&yptr=yahoo

 
Comment by Hi-Z
2018-06-11 17:06:14

However the hypocrisy of the left is amazing after attacking Walmart at every turn, Amazon gets a pass.

Perhaps because Bezos is firmly in the far left camp?

 
 
 
 
 
Comment by Apartment 401
2018-06-09 08:41:07

Real journalists reluctantly report a narrative that contradicts the globalist narrative of cultural relativism:

“It was a gruesome murder: A 14-year-old girl was raped and strangled, her body buried under brushwood in a secluded area near the railway tracks near her hometown in western Germany.

But the fact that the chief suspect is an Iraqi asylum seeker has turned a terrible crime into political dynamite.

On Friday, the case dominated the German news media and became the latest cudgel for Chancellor Angela Merkel’s opponents and, some predicted, a potential turning point in the migration debate in a country where some 10,000 asylum seekers still enter every month.

The murder suspect, identified as Ali Bashar, a 20-year-old Iraqi, arrived in Germany in October 2015, shortly after Ms. Merkel opened the borders to hundreds of thousands of migrants. He was rejected in late 2016, but was allowed to stay in the country while his appeal was pending.

Last Saturday, he and seven other members of his family managed to flee the country, boarding a plane in Düsseldorf with papers apparently issued by the Iraqi Consulate but featuring false names, after paying cash for a one-way fare to Istanbul and then on to Iraq, where he has since been arrested.”

https://www.nytimes.com/2018/06/08/world/europe/germany-susanna-murder-migration.html

Comment by rms
2018-06-09 10:49:59

“Cultural relativism is the principle of regarding the beliefs, values, and practices of a culture from the viewpoint of that culture itself.”

What does that really mean? Should I hide my wallet?

Comment by In Colorado
2018-06-09 11:29:46

You should acquire a firearm. Of course, in many countries that is not allowed.

Comment by rms
2018-06-09 12:24:57

“You should acquire a firearm.”

So the culture that I adopted doesn’t have a future?

(Comments wont nest below this level)
 
 
 
Comment by Taxpayers
2018-06-09 12:21:10

Crying Chuck will be there to greet them

 
Comment by TIC TOK
2018-06-09 16:15:28

My Uber driver yesterday was named Said. Straight off the boaf, barely spoke English. The invasion is happening here as well as Europe.

Comment by sod
2018-06-09 19:54:47

I’ve used Uber once. My driver was from Georgia, and no, not the peach state. He got off the wrong exit, stopped a little way down in the shoulder and then reversed back up and got back on the freeway. I was too tired to complain and he wouldn’t have understood me anyway.

Comment by jeff
2018-06-10 08:55:22

No Uber for me, we already share the roads with drunks everyday.

Video shows fiery wrong-way crash on Texas highway

By Cliff Pinckard, cleveland.com cpinckard@cleveland.com

DUNCANVILLE, Texas — The mother of a bab boy was killed when her vehicle was hit head-on by a drunken man driving the wrong way down a busy interstate highway, reports say.

https://www.cleveland.com/metro/index.ssf/2018/04/video_shows_fiery_wrong-way_cr.html

(Comments wont nest below this level)
 
 
 
 
Comment by Ben Jones
2018-06-09 08:42:37

‘in December 2016 Frank Giacobbe, a Buffalo-based mortgage broker, allegedly told a lender for a Pittsburgh property that the apartments were more than 95 percent occupied. Three months later an employee of the complex, unaware of the earlier claims, sent an accurate report to the lender that showed less than 70 percent of the complex was occupied.’

Wow now that’s some skullduggery alright. An appraiser or bank auditor might actually go over and look at the apartments before handing $100M in cash. Oh, that’s right, these guys put sandals in front of the units and played music and such. How about just looking at them at night?

Comment by BlueSkye
2018-06-09 10:47:40

a Buffalo-based mortgage broker…

Even if they knew the loan was bad, they would make money on brokering it.

 
 
Comment by Ben Jones
2018-06-09 08:48:22

‘The trouble, according to economist Mark Zandi, is that during the steady economic expansion of the late 2010s, there’s been little impetus to shake up a system that has extended as-yet untested credit to residential borrowers and returned billions of dollars to taxpayers. ‘The main sticking point is that the system works,’ Zandi said. ‘You’re not happy with the pipes, but the water’s flowing. Do you really want to change the plumbing?’

This article is well worth reading in full. Obama’s people knew just what they were doing. It struck me though. This is a group of people that pretend to “run the world”. It’s finances, the military, the gigantic finances involved. But they don’t have the nerve to fix one obvious FUBAR situation. Just kick the can, let someone else worry about it. Never-mind it’s causing housing to be more unaffordable, and ignoring it may be a bubble as bad or worse than the last!

Zandi, you are a commie asshat. If there is a definition of asshat in the dictionary, your face is next to it.

Comment by rms
2018-06-09 10:24:41

“And since taking control of Fannie and Freddie in 2008, the government has earned back the $187 billion it spent bailing out the agencies, plus $80 billion more.”

I have a problem believing this statement, and it’s not the first time I’ve seen it. If it really is true then why is the national debt rising each year?

Comment by Ben Jones
2018-06-09 10:30:55

The debt would be a lot worse if the previous administration hadn’t padded the budget with GSE profits. And sure they were making money: they have a near monopoly with government backing. They also stormed into the multi-family market to the tune of around a trillion bucks. A bunch of this was cash out refinancing like Bob Morgan’s. Oops!

 
Comment by In Colorado
2018-06-09 11:32:12

That 80B amortized over the past several years, would barely make a dent in the deficit.

 
 
Comment by rms
2018-06-09 10:28:18

“…economist Mark Zandi…”

Yeah, Zandi is a tool alright, e.g., my standard of living is improving because my neighbor’s iPhone has a faster processor.

Comment by Mafia Blocks
2018-06-09 10:31:36

Like all housing pimps, what falls through their lying teeth depends on who is paying them to say it.

It’s a housing industry bylaw.

 
Comment by TIC TOK
2018-06-09 16:19:52

Your standard of living is improved if the faster processor is as affordable as the older slower one. A $500 laptop today is exponentially better than $1000 laptop from 10 years ago. Ans that has improved your life whether you own a laptop or not.

Comment by Ben Jones
2018-06-09 20:16:32

‘Ans that has improved your life whether you own a laptop or not’

What an odd thing to say.

(Comments wont nest below this level)
Comment by Mafia Blocks
2018-06-10 04:09:19

Comment by Tik Tok
2018-02-19 15:15:59
What constitutes luxury for an apartment exactly?

20 years ago - God I can’t believe I’m getting that old - my first apartment out of college was a 2 bedroom, 1 bath for $1600/mo. In today’s dollars that’s around $2500. I split it with a friend from college, who as luck would have it also got a job at the same company as I did.

This apartment was OK, but it was nothing I would call luxurious. It did have A/C which was rare back then, but other than that, pretty meh place. The kitchen was so small, more than 2 people couldn’t be in it at the same time.

So if today $2500 gets you all the “luxury” items like movie theaters, infinity pools, granite counter tops and whatever else they’re throwing around, it doesn’t seem that expensive relatively speaking.

Same FedRes garbage…. same schlock…. same pimp

 
 
Comment by rms
2018-06-10 04:22:26

“Ans that has improved your life whether you own a laptop or not.”

I’m sure a homeless family would wholeheartedly agree too.

(Comments wont nest below this level)
 
Comment by DF
2018-06-10 06:50:30

I don’t know if I’d say it’s “exponentially better”. I’d say it’s probably 2x-5x better.

My current laptop does the same stuff the laptop I had in 2008, it’s just that it’s a lot thinner an lighter. There is some noticeable performance improvement from having an SSD though.

Moore’s Law basically ended in 2012, so further improvements are going to be fewer and further between.

(Comments wont nest below this level)
 
 
 
 
Comment by Mortgage Watch
2018-06-09 08:50:36

Brighton Beach Brooklyn Rental Rates Crater 9% YOY As Global Housing Bust Ravages NYC

https://www.zillow.com/brighton-beach-new-york-ny/home-values/

Select price from dropdown menu on rental chart

 
Comment by Ben Jones
2018-06-09 08:55:49

From the last link:

Also among the specific allegations are:

• “Staging” properties so it appeared to visiting inspectors that unrented units were occupied.

• Inflating the income from apartment storage units. In an email, Giacobbe asked Kevin and Todd where an extra $72,000 in storage unit income came from, and Kevin replied, “Magic,” authorities allege.

• Trying to falsify radon tests by placing the testing mechanism near an open window of an upper-floor apartment, instead of in the basement where reliable testing is done.

• Arranging for cars to be parked in a complex garage so it appeared there were more tenants than there were.

Federal authorities have made it quite clear that the investigation continues. They won’t say, of course, whether more arrests are imminent or expected. The Morgan Communities office in Perinton was searched by the FBI in mid-May, so surely the records seized from there — whatever they may be — are still being studied by authorities.

Bob Morgan, who once worked in his family’s South Plymouth Avenue fish store, started Morgan Management in 1979 as a small-time investor in commercial property. Today, the company is the largest private-sector property owner in Monroe County, with more than $250 million in apartment complexes, office buildings, shops and other commercial structures in its Monroe portfolio.

The company website lists 67 apartment complexes in Monroe County alone. The company also has become a major player in the downtown development scene. Beyond Monroe County, Morgan Management has 34 residential developments elsewhere in upstate New York and 60 complexes spread over 11 other states, according to its website.

Since 2012, the county’s industrial development agency has given property and sales tax breaks totaling nearly $65 million to 21 projects being developed by Morgan and, in some cases, corporate partners.

And as the Democrat and Chronicle reported recently, Morgan owes the city about $17 million on five loans the city made to support downtown developments.

A number of locally active banks that have loaned money to Morgan — KeyBank, M&T, Canandaigua National and Lyons National — declined to comment when asked whether they had any contact with investigators.

Fraud cases as sweeping as this one can seem to have an eternal lifespan in federal court. There are numerous reasons for this, a key one being the volume of evidence that defense lawyers have to sift through and scrutinize for pretrial and trial arguments.

For instance, one of the largest mortgage fraud cases in Monroe County started with indictments in December 2000 and ended with guilty verdicts at a trial in April 2003. In that case, the late Robert A. Amico and his two sons used fake mortgages and inflated appraisals in what was a $60 million mortgage-fraud scheme.

Comment by Taxpayers
2018-06-09 09:11:50

I was going to say to make money in upstate ny u have to be crooked

Comment by Mafia Blocks
2018-06-09 10:40:14

When used housing sells for more than construction cost ($50/sqft for lot, labor, materials and profit), there’s a whole bunch of crimes going on.

Comment by DirtyLawyer
2018-06-10 09:39:38

While this would be nice, it is not reality and is a meaningless figure.

(Comments wont nest below this level)
Comment by Mafia Blocks
2018-06-10 10:05:31

When you bring something to the table, let us know.

 
Comment by DirtyLawyer
2018-06-11 06:58:16

I was going to ask the same of you.

 
Comment by Mafia Blocks
2018-06-11 07:08:53

You’ve been schooled on it going back to 2012. Your pain today is just as great as it was then.

 
 
 
 
Comment by MacBeth
2018-06-09 10:51:59

“In an email, Giacobbe asked Kevin and Todd where an extra $72,000 in storage unit income came from, and Kevin replied, “Magic,” authorities allege.”

Whoa…ho…ho…it’s magic! You know…(la la la la la la)….never believe it’s not so…

https://www.youtube.com/watch?v=MzlK0OGpIRs

Should it be the HBB’s theme song for the housing bubble? Would be fun to play this on loudspeaker outside of NAR headquarters!

 
 
Comment by Taxpayers
2018-06-09 09:09:29

after taxing the world, world bank n imf employees get tax free pensions

 
Comment by Ben Jones
2018-06-09 09:18:11

This shack just showed up on foreclosure.com:

https://www.zillow.com/homedetails/3674-Richard-Kern-Flagstaff-AZ-86005/7368521_zpid/

3674 Richard Kern, Flagstaff, AZ 86005
5 beds — baths 4,612 sqft
Off Market
Zestimate®: $1,112,962

Amazing opportunity to own in one of Flagstaff’’s most prestigious communities, Forest Highlands. 5 bedroom 4 bath home on .78 acres of heavily treed Ponderosa Pines. This home has two master suites, one on the lower level as well as upper level. Large living area with vaulted ceiling and fireplace. Formal dining room and breakfast nook.

06/08/18 Listing removed $649,900 $140
12/18/17 Price change $649,900-1.5% $140
10/30/17 Price change $659,900-2.2% $143
09/20/17 Price change $674,900-2.2% $146
07/24/17 Listed for sale $689,900+2.3% $149
03/10/17 Sold $674,208-25.8% $146
03/04/17 Listing removed $908,066-0.0% $196 Auction.com
11/20/14 Price change $908,410+3.8% $196
09/17/07 Sold $875,000+80.4% $189 Public Record
10/03/94 Sold $485,000

It looks like it was initially foreclosed around the time of the auction.com thing. Forest Highlands was where I first started property preservation work back in 2008. I was such a regular there the guards would sometimes wave me through. The golf fees alone would exceed most mortgages in saner times. These are almost all second shacks.

Comment by Mafia Blocks
2018-06-09 10:28:48

It might sell once it gets down into the $100,000 range.

 
Comment by rms
2018-06-09 10:30:03

I didn’t realize that Flagstaff has that kind of money in circulation.

Comment by Ben Jones
2018-06-09 10:38:07

This isn’t the most expensive either. That goes to Pine Canyon, another place where the guards knew me by first name. These two were the first to see big walk-aways in N AZ.

https://www.pinecanyon.net/golf/membership/

 
 
Comment by rms
2018-06-09 10:38:05

It would be impossible to save that place in a fire as it’s literally surrounded by trees within spitting distance.

Comment by hwy50ina49dodge
2018-06-09 11:09:49

https://www.drought.gov/drought/node/25.

(Caution: evil gubermint$ fake new$ data)

$mokey says:
Only YOU can prevent fore$t/wild fire$!!!

ENVIRONMENTSEPTEMBER 14, 2017
Cost of fighting U.S. wildfires topped $2 billion in 2017
Laura Zuckerman / Reuters

SALMON, Idaho (Reuters) - The costs of fighting U.S. wildfires topped $2 billion in 2017, breaking records and underscoring the need to address a U.S. Forest Service budget that mostly goes to fires, Agriculture Secretary Sonny Perdue said

“Forest Service spending on fire suppression in recent years has gone from 15 percent of the budget to 55 percent – or maybe even more – which means we have to keep borrowing from funds that are intended for forest management,” Perdue said in a written statement.

The recent Ute fire in New Mexico … the day after Memorial Day, the Rangers found over 100 abandoned, unextinguished campfire$.

 
 
Comment by MGSpiffy
2018-06-09 11:05:15

Sold for too much in ‘07. Never had a chance to even break even on it. $16K a year in taxes and HOA fees alone.

Second homes in the front of the lines, eh.

 
 
Comment by Taxpayers
2018-06-09 13:25:17

Of all the rents shouldn’t these guys be kick in ass
I,m guessing they bought most of their sch early on
https://finance.yahoo.com/quote/AMH?p=AMH

Comment by Taxpayers
2018-06-09 13:44:11

Balance sheet growing ,marking assets up or buying more

 
 
Comment by hwy50ina49dodge
2018-06-09 14:44:43

Once ya add in hi$ legal fee$, how much ya reckon his kilowatt$ per hour i$?

Celebrity chef Adam Harvey arrested for poisoning seven-story maple tree blocking his solar panels

http://www.nydailynews.com/new-york/ny-metro-celebrity-top-chef-tree-killer-20180606-story.html

(might bee he ought sign up on the “pardon li$t” pronto like.)

 
Comment by Mike
2018-06-09 15:58:52

Interview with former Greek finance minister (Varoufakis). An inside look at the deep international state.

https://www.salon.com/2018/06/09/how-the-greek-debt-crisis-exposed-the-global-economy-as-a-giant-con-and-led-to-donald-trump/

The whole interview is worth listening to…

Excerpt:
Varoufakis argues that the entire Western economy has become a massive con game, on a scale thousands or millions of times larger than anything Bernie Madoff could have imagined. Furthermore, in his telling, it’s a con game run by intelligent and not necessarily malevolent people who understand perfectly well that the whole enterprise is a fraud that’s bound to come crashing down eventually. He says he knows that to be true because those people told him so, in
the kinds of closed-door meetings where the uppermost level of the managerial caste discuss such things.

Comment by hwy50ina49dodge
2018-06-09 16:24:57

Let$ add clarification$:

“in the kind$ of clo$ed-door meeting$ where the uppermo$t level of the managerial$ ca$te discu$$ $uch thing$”

 
 
Comment by Professor Bear
2018-06-09 21:27:55

“Since the financial crash, global housing markets have become more synchronised: prices and the way they move have become more and more correlated, particularly in major gateway cities. A combination of low interest rate policies around the world, improved economic growth and the increasing importance of global capital has caused this alignment.”

Synchronised bubble on the way up, turtles all the way down.

 
Name (required)
E-mail (required - never shown publicly)
URI
Your Comment (smaller size | larger size)
You may use <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> in your comment.

Trackback responses to this post