Looking Florida’s ‘Sacred Cow’ Straight In The Eyes
Some housing bubble reports from Florida. “Housing prices in Palm Beach County are so high that 90 percent of the workforce can’t afford to buy the median-priced home. An obvious solution, raising wages, isn’t practical, business leaders said.”
“Jennifer Vacco, human resources manager for Lockheed Martin in Riviera Beach, has hired nearly 200 people in the past 18 months, but it’s the ones who got away she can’t stop thinking about. ‘Every time, it was the cost of housing,’ she said, speaking of engineering recruits scared away by Palm Beach County’s home prices. ‘And these were professional jobs paying $70,000 a year.’”
The Naples News. “‘From April through June, our permit applications have increased significantly. We are up 60 percent over the same period last year,’ said Collier County Building Director Bill Hammond.”
The St Petersburg Times. “In the clearest indication yet that the housing boom in Hernando County has come to an end, the inventory of unsold homes has climbed to nearly 3,760, nearly five times the number a year ago.”
“‘It came to a screeching halt,’ said Jack Gavish, a Brooksville real estate broker. Many real estate offices in the county are selling about half as many homes each month as they were last year, he said. ‘I’ve had a brand-spanking new home on the market for 30 days for $149,000 and that concerns me,’ Gavish said.”
“County Commission Chairwoman Diane Rowden said the declining market might be a sign the county should rethink the number of approvals it has issued for the construction of new subdivisions. ‘Most of it, as I see it, are speculative rezonings,’ she said.”
The Marco Island Sun Times. “Since there is no federal regulation governing marketing or promises of guarantees of spectacular returns, many investors and homeowners alike are really starting to feel the sting of higher ownership costs associated with the rapid deflation of the real estate ‘bubble.’”
“One local investor tells the story of how he was ‘guaranteed’ by a salesperson that he could sell a property he was considering buying in 12 months for a tidy 30 to 40 percent profit.”
“Nearly 18 months later, that ‘guaranteed return’ sits empty with no prospects in sight. In fact, this particular investor doesn’t feel as though he could even recover the initial investment he made to begin with.”
“Nobody likes it when we look the ‘Sacred Cow’ square in the eyes and dare to consider that Marco Island residential real estate could do anything but go straight up. The story may not always be as drastic as the retired banker friend of the family, who owned a direct access waterfront lot back in the early 1980’s for almost six years and sold it for a 25 percent loss.”
Here’s a letter to the editor:
‘I wonder if a private financial organization in Florida could start a weekly charitable lottery whereby the proceeds would be split between one winner and a foreclosure assistance team.’
‘Adding to the glut of foreclosures was the advent of the historically low interest rates and ‘interest-only’ loans, which have set families up for financial disaster. Predictably there were many people who had refinanced their homes with the attractive low finance payments in order to reinvest in what they thought would be a quick turnover property and now are losing both the quick turnover investment and their homes.’
‘The markets are flooded with the scramble of panicking novice investors, which further exacerbates the foreclosure crisis.’
Slay a sacred cow.
52 week lows on:
SPF
HOV
TOL
LEN
WCI
Round of ass-pounding for the HB’s?? NO LUBE, of course!
Damnit, I gotta go for the wallet again!
Waitress! Please bring a round of “painful ass-poundings” to my Marco Island Flipper friends over there at the corner table!
augger-in,
You are running up a rather large tab. How much does a “painful ass-pounding” go for these days? What flavors are there? Could I take advantage of a “morally challenged” co-ed if I were to buy her a few one evening?
Could I take advantage of a “morally challenged” co-ed if I were to buy her a few one evening?
Probably not. You’re obviously past peak performance if you’re using words like “co-ed”.
So what are you gents callin’ the gin molls these days?
skank ho’
You are running up a rather large tab. How much does a “painful ass-pounding” go for these days? What flavors are there? Could I take advantage of a “morally challenged” co-ed if I were to buy her a few one evening?
Man, these bastards are going to bankrupt me (too). I don’t know what they cost but I know they are worth it and going for a good cause as well! When I get the tab I’ll let you know!I’ll have to get back to you on the flavors. I’m thinking yes, absolutely, these drinks will do the trick with the co-eds! Please order a round for the ladies next time you are out and let me know how it goes!
Will do auger-inn. I’ll find the hottest vixen at the bar and ask her if I can get her a “painful ass-pounding”. $50 says I get punched in the face. Wouldn’t be the first time and won’t be the last. My favorite flavor is cherry.
hehe, let me know how the experience pans out for you (I’m not taking the bet).
PS, it’s been a while since I’ve seen any bar carry your favorite flavor, good luck finding it.
You guys are embarrassing yourselves and all of us on this blog, I would think. Take your misogynist stuff somewhere else. Thank you.
i’ve been thinking about this one:
when using “damn” (predicate) with “it” (object) the spelling actually looks better as “dammit”.
can you picture this at a spelling bee?
(just playin’ with ya auger!)
Hey auger-inn, there’s a small group at the end of the bar in the last thread too. Maybe you could buy them a round as well?
OK, where are they from? This is getting expensive!
I don’t know where they’re from but they look nice and stupid, just the way you like ‘em.
how do you know me so well?
What kind of FICO score does a new college grad with a degree have with or withhout student loans, assuming no significant credit history?
Housing prices in Palm Beach County are so high that 90 percent of the workforce can’t afford to buy the median-priced home. An obvious solution, raising wages, isn’t practical, business leaders said
In addition to that many people I know who bought long ago in NoVa and still have plenty of equity left in their homes and could price it right to sell, do not sell because prices are so high even with the equity they can’t buy up.
Unless prices come down in a significant way, there are no buyers in this market.
Oh now that is an interesting observation! I’d never considered that. What you’re saying in a way is that you don’t have to be a “bubble sitter” to be sidelined. Hmm?
Why must they buy up? Are people never satisfied with what they have?
I didn’t write clearly above.
Some want to buy up, or move, or buy newer or even downsize.
My real point was that they can’t no matter what the reason they are doing it for b/c the equity is not enough for them to afford to make any kind of move at current prices.
Agreed. My wife and I have looked at condos and much smaller SFH to no avail. And we live in OREGON for goodness sakes! When condos (and let’s try to remember that the whole idea dating back to the 70’s was to have a minimalist/care free lifestyle) are as expensive or nearly as expensive as SFH 2 or 3 years ago what’s the point? You can go through listings until your eyes bleed but sellers are so upside down they don’t have a lot of room to come down in price if at all. On a personal level this has been the most frustrating aspect of all.
No they are never satisfied. “You had to be a big shot.”
Think big.
They should listen to the Cypress Hill song “Rap Superstar”
I nominate this song for the siren song of the FB.
CYPRESS HILL Song Lyrics
Rap SuperStar
(From the album “SKULL & BONES”)
Most people don’t see how much work is really involved in this rap shit
I didn’t know it
I didn’t see it
I never saw it until i was actually in it
You really gotta be in it
To understand what its like
But you always gotta
People always gotta see your smile
You always gotta put on that fake
You know what i’m sayin
No matter what u just been through
(B-Real)
So you wanna be a rap superstar in the benz
And live large a big house
5 cars
The rent charged
Comin up in the world
Don’t trust nobody
Gotta look over your shoulder constantly
(B-Real)
I remember the days when i was a young kid growin up
Lookin in the mirror dreamin about blowin up
To rock crowds make money
Chill wit the honies
Sign autographs and whatever the people want from me
Shits funny
How impossible cream manifest in the games that be comin with it
Never the less you gotta go for the gusto
But you don’t know about the blood sweat and tears and losin some of your peers
And losin some of your self
Music has past gone by
Hopefully you don’t manifest for the wrong guy
Egomaniac in the brainiac
Don’t know how to act
Shits deep
48 tracks
Studio gangsta mack
Sign a deal emcees wanna make a mill
But never will
Till he crosses over still
Feelin no hate
But fantasies come wit these
Just to sacrifice the taste of makin cheese
You wanna be a rap superstar in the biz
And take shit from people who don’t know what it is
I wish it was all fun and games
But the price of fame is high
And some can’t pay to play
Trapped in what you rappin about
Tell me what happened when you lost clout
The rout you took started collapsing
No fans
No fame
No respect
No change
No women
And everyone shits on your name
(Chorus)
So you wanna be a rap superstar in the benz
And live large
A big house
5 cars
The rent charged
Comin up in the world don’t trust nobody
Gotta look over your shoulder constantly
To be a rap superstar
And live large
A big house
5 cars
The rent charged
Comin up in the world don’t trust nobody
Gotta look over your shoulder constantly
(Noreaga Speaking)
When you sign to a record label
You don’t know you sign your life over
And these whiteboys don’t care about you
Cuz the minute you fall off
They’ll find another Noreaga
And they’ll find another Capone-n-Noreaga
And they’ll find another B-Real
So you need to just keep
Stack your chips up
Do what you gotta do while your hot
And mafuckin get out the game
Stick to the drug game
And the drug game is even worse
Because if someone jerks you
You can shoot em and kill me
But in this game if someone jerks you
You gotta be humble
(Eminem Speaking)
No matter what you just been through
Shit has gotta be right
You gotta approach people
You gotta be on the up and up
And everything gotta be all good
When you see someone slap hands with em
You know what i’m sayin give em a pound
Or whatever it is
But you always gotta act like it ain’t shit
(Chorus)
(B-Real)
My own son don’t know me
Sittin up in the hotel room lonley
But I thank god I’m wit my homies
But sometimes I wish I was back home
But only no radio or videos
Cuz they show me no love
The phony gotta hit the road slowly
So the record gets pushed by sony
I’m in the middle like monie
And the press say that
My own people disowned me
And the best way back
Is to keep your head straight
Never inflate the cranium
Your crew worried about them honies at the paladium
Who just wanna cling on swing on
And so on and go on and fall off
The hoes fall off
To the next rap superstar
Wit no shame give him a year
And they’ll be right out the game
The same as the last one
Who came before him
Gained fame
Started gettin ignored
I warned him
Assured him
This ain’t easy take it from weezy
Sleezy people wanna be cheesey
They talkin evil
Why is it that raising wages in Florida is never practical? The obvious solution to the problem is to raise wages!! If you want workers, you have to pay more so they can afford to live in your state. Florida always seems to be way down at the bottom when it comes to paying employees.
Claudia,
Fact is, companies do not double ones salary because a bunch of slimeballs caused the housing market to double and triple in some cases.
Why should companies pay their employees more in Florida than Georgia? Makes no sense.
Or Bangalore. First containerization lowered shipping costs and enabled the rest of the world to more easily compete in the market for goods in the U.S. High efficiency, low cost telecommunications enables foreigners to compete in the service industry. It is this increased competition that will continue to hold down U.S. wages.
Because wage inflation is the worst inflation of all (after stag). If you increase everyones wages with the same supply of resources, then prices go up the same amount (or more). Labor is normally the most expensive cost of any industry, whether service or manufacturing, or whatever.
Yes, but it is all a vicious circle. Housing costs go up so wages have to go up. Prices have to go up too. Such is life. Florida always seems to think they can slide by paying less than every other state but it eventually catches up to them. The only reason nurses don’t want to go to Florida is because of the PAY!!
Uh… isn’t the “obvious solution” to LOWER THE PRICES????!!!
Absolutely…the only thing that needs to happen is for house prices in South Florida to lower back to where they were about three years ago. A mid-range employee at the company I work for in Miami bought his 3/2, 1600 ft2 home 3 years ago for $195K. He transferred out of state a few weeks ago and the house is still sitting empty as he stubbornly tries to sell at $370K (after dropping from $390K), because he believes “that’s what it’s worth, and I’m not going to GIVE it away”. Unbelievable! Future buyers just need to hold out and prices will be forced back down to where they should be. The key problem as we all know is how long will it actually take for things to return to normalcy.
One local investor tells the story of how he was ‘guaranteed’ by a salesperson that he could sell a property he was considering buying in 12 months for a tidy 30 to 40 percent profit.”
Yea, and I can guarantee you a 200% when you by the San Francisco Bay Bridge from me for $2 Million. And for a measly extra $1M, I will throw in the Golden Gate. Think of all that toll money you will reap. 200,000 car pay toll at $3 on the SFBB and 150,000 on the GG. Hurry, deal ends by midnight tonight. Do not hesitate. Wire the money to the account number “Kiss your money goodbye, you dumb ASS” in care of First National Bank in Zurich Switzerland.
“One local investor tells the story of how he was ‘guaranteed’ by a salesperson that he could sell a property he was considering buying in 12 months for a tidy 30 to 40 percent profit.”
Question I want the reporter to have asked:
Dude. Did you ever stop to wonder why the salesman was selling something that was guaranteed to go up 30 to 40% in 12 months?
He was selling the stuff dreams are made of. And the buyer was dreaming of untold riches…
Don’t worry, many realtors did drink their own kool aid. They’re trying to sell now as well.
And guess which house they’ll sell first, the one they’re paying the carrying costs for, or the one owned by some dumb FB in HELOC hell.
Jennifer Vacco, human resources manager for Lockheed Martin in Riviera Beach, has hired nearly 200 people in the past 18 months, but it’s the ones who got away she can’t stop thinking about. ‘Every time, it was the cost of housing,’ she said, speaking of engineering recruits scared away by Palm Beach County’s home prices. ‘And these were professional jobs paying $70,000 a year.’
AND THEIR HOUSING COST IS ABOUT 50% OF THE BAY AREA AND PAY IS THE SAME. SO, WHERE IS THE SF BAY AREA GOING?
70K does not get you far in NoVA either, especially for younger families with kids.
Anecdotal evidence of tightening lending standards?
http://tinyurl.com/on28w
SDCIA - Message Board
TonicBeach (Steve Brant)
“Oddly enough Option Arms have been performing great on Wall St. but, what has not been considered is that these loan have not had a chance to recast or come out of their 3 to 5 yr term.”
“100% of my purchase loans have been Interest Only or 40yr terms. It has been like this for the last 2 years. 85% of those loans have been Stated Income documentation.
The governments of China, Japan, Germany, Korea and even Mexico are the major buyers of MBS as well as some pension portfolios. When these guys decide to switch to a less risky investment such as T-bills. Watch out.”
These numbers are going higher than a Korean missile
mid may was 799,000
6/10/06 was 836,471
6/14/06 was 840,935
6/17/06 was 846,120
6/20/06 was 850,317
6/22/06 was 855,892
6/24/06 was 860,647
6/29/06 was 866,037
7/01/06 was 858,675
7/09/06 was 870,854
7/11/06 was 882,239
7/13/06 today 886,055
http://www.ziprealty.com/maps/index.jsp?usage=search&cKey=74rbwvlk
MUCH higher than Korean missile I’d say. Those blow up 40 seconds after launch.
“Jennifer Vacco, human resources manager for Lockheed Martin in Riviera Beach, has hired nearly 200 people in the past 18 months, but it’s the ones who got away she can’t stop thinking about. ‘Every time, it was the cost of housing,’ she said, speaking of engineering recruits scared away by Palm Beach County’s home prices. ‘And these were professional jobs paying $70,000 a year.’”
but where are they moving to?
Wow! People actually want cheap housing?
yeah (imagine that, huh)….and to also be able to pay their other bills, take a vacation every now and again (preferably, once a year)…and on and on. The usual day to day livin’ stuff. It’s hard to do that if your housing costs are taking 50% of your income.
And who was it who mentioned the minimalist lifestyle? That’s what I’m talking about.
BayQT~
To Houston, TX where high paying jobs are plentiful & housing is actually extremely affordable.
Please, for the love of God, don’t tell people that. I’m hoping it will stay free of equity locusts until I get there.
You need not worry. There aren’t enough equity locusts in the entire country to cause a housing shortage in Houston.
Yeah, Houston and its ex-urbs are still working off the 80s bubble.
The Naples News. “‘From April through June, our permit applications have increased significantly. We are up 60 percent over the same period last year,’ said Collier County Building Director Bill Hammond.”
Wow did that have anything to do with the rush to beat the new impact fees, Bill Hammond forgot to say that in his Prepared statement,
Hey, Mr. Hammond. Do you really think that there is an unlimited supply of fucked up fools with unlimited bank rolls that want to relocate to your county and buy all of those houses, and will willingly pay all of your taxes, impact fees, assessments, surcharges, etc for saving squirrels, rats, mosquitos, homeless bums (see thread for downtown LA), and any other thing that you and your corrupt cronies can think of?
You have to understand that down here, people by and large do NOT believe prices will fall. FL is special … FL is different … tons of retiring Baby Boomers and savvy South American investors will be snapping up our properties until they cost a bazillion dollars.
I talked on this board a few days ago about how my cousin and his wife refuse to do what’s needed to unload her former place (from before they got married … it’s been languishing on the market now for 2 months and counting … they’re using a HELOC on their primary home to pay the mortgage on the secondary while it’s listed). Many, many other average South Floridians believe the good times will last forever, too. Unbelievable!
Transplant South Floridians believe, but crackers remember Miami’s bust.
The “savvy South American” urban myth seems particularly entrenched. I know that it is the linchpin of my friend’s theory that he will still get what his place is “worth,” i.e., almost $100K (70%) more than he paid for it barely two years ago.
Yep, I hear that ALL the time in my office in Miami. Typically the anecdote is that rich Colombians or Venezuelans are the Latin Americans of choice who will keep the prices up everywhere in Miami-Dade and Broward. At least according to my co-workers who are mentally spending all of their new found riches.
Pick your choice of “reasons” Florida housing won’t fall:
1. South American investors
2. Miami party scene night life
3. Proximity to beaches
4. Proximity to Disney world
5. Running out of land
6. No winters
7. Hot summers
8. Everyone wants to live here
9. Low cost of living
….And finally….
10. Because housing only goes up
(Just a few reasons I’ve been told from people who are just smart enough to get a loan and too dumb to spend it wisely)
“Jennifer Vacco, human resources manager for Lockheed Martin in Riviera Beach, has hired nearly 200 people in the past 18 months, but it’s the ones who got away she can’t stop thinking about. ‘Every time, it was the cost of housing,’ she said, speaking of engineering recruits scared away by Palm Beach County’s home prices. ‘And these were professional jobs paying $70,000 a year.’”
1st, $70K a year just isn’t that much money anymore, these companies keep hiring compensation consulants that tell them what they want to hear. 2nd, this trend is leading to companies like my own where there are few young people at all. Just old and older farts like me who were lucky enough to buy a place years ago and now are stuck in a situation where we either stay in the place we have or move out of the area completely. There is no chance of moving up any more due to stagnant wages and out of control housing costs.
speaking of existing work force…Intel just announced laying off of 1000 management positions
yeah, about time. 1000 down, 9000 to go.
Disney is laying off as well. They haven’t announced a number but in th OC Register they are quoted as saying they will be cutting their movies from 18 per year down to 8 per year. That would be a large layoff for many high paying jobs in Burbank, CA.
I wonder how that will affect the folks on Pixar campus now that Disney and Pixar merged? I haven’t heard of any layoffs yet.
BayQT~
I hope they don’t fire Foghorn Leghorn! I love that guy!
But he works for the OTHER GUYS.
From today’s LATimes:
“An exact number of planned job cuts wasn’t known Wednesday, although people familiar with the studio’s plans estimated that the headcount would be reduced by 20% to 25%.”
This is the studio division.
$70k is a lot of money for Florida. It’s telling that can’t even buy a house in the area. Wish I made $70k.
Well, either they take that 70K job, or HR sends it to Chindia for $0.20 on the inflated dollar.
“Housing prices in Palm Beach County are so high that 90 percent of the workforce can’t afford to buy the median-priced home. An obvious solution, raising wages, isn’t practical, business leaders said”
And the reporter had to ask the business leaders why simply raising wages won’t work? Come on. The solution to this problem is so obvious, $50 minimum wage. Everyone’s rich, everyone buys a house, everyone’s happy. I don’t understand why that’s not practical. (joke)
It’s like a reporter saying, “Local rivers will top flood stage this week, and there’s no end in sight. An obvious solution, stopping the clouds from dumping rain, isn’t practical, expert hydrologists and meteorologists say.”
RE: Jack Gavish, Brooksville realtor
I’m wondering if this little jewel is the one Jack has been trying to sell at $149K? Bet the neighborhood is charming as well.
http://www.century21gavish.com/mls.htm
Re: Jack Gavish $149,900 house that won’t move darnit!
It’s MLS #241748……
This cracks me up. I live in S. Jersey and I drive through Cumberland and Cape May counties several times and year and have for years to go fishing. Poorest counties in the state. I drove past old shacks that 5 years ago were totally run down that would have fetched $30k tops and probably had a skanky toothless waitress living it it with her illegitimate kids and her ex-con boyfriend. Then 5 years later someone comes along buys it, puts 20 k worth of drywall and paint on it and slaps a forsale sign on it for $220k Hilarious. Simply because it’s in the shore area. These areas will go back to poverty stricken areas they truly are, and someone will be going down the tubes with that suicide loan along with it.
Last year I was househunting in NoVA, and I had seen a place, where they were selling half of the mobile home (it was double unit) for 240K!. And someone bought it within a week or so. I wish I would remember the MLS for it and post it here. It was unbeliaveble, but true.
Alachua eh? $149k will buy the nicest house in the county. The only house there, the rest are trailers.
I’m pretty sure there is a cement plant where you can work for $8 an hour.
At this point , sellers who can hold on to their properties for “better” times make up the minority. Most of them need to sell their houses before the higher interest kicks in. I feel sorry for these people but they are not sinless either. Seeing people flipping houses and making huge money sometimes overnight lured a lot of people who did not know much about the situation and what it was heading. It had to stop and it did. No more buying it for 200K and listing it for 250K next day and selling it for 275K in a week. Those days are gone. In Florida sellers need to give up about 30% of 2005 prices to be even considered by buyers. In some cases even that may not be enough. Shame on all those informacials and get rich by flipping homes schemes advertised and those greedy b@#stards.
So, if wages have to rise to cover housing costs, and/or the government starts subsidising housing in some form, we all end up paying for folks who got “vodoo mortgages” and bid these things up in the first place.
I KNEW that when the bubble was over, we’d all end up paying for it.
Jaws quote time again (groans from the peanut gallery): Very first light chief, the sharks come cruisin’. So we formed ourselves into tight groups… The idea was the shark nears a man and then he’d start poundin’ and hollerin’ and screamin’ and sometimes the shark would go away. Sometimes he wouldn’t go away…then you hear that high pitch screamin’ and the ocean turns red and in spite of all the poundin’ and hollerin’ they all come in and rip you to pieces. Ya know, by the end of that first dawn, lost a hundred men. I don’t know how many sharks, maybe a thousand…
Captain Quint, repo man.
Wow, what a steal. You don’t even have to mow the lawn!
““One local investor tells the story of how he was ‘guaranteed’ by a salesperson that he could sell a property he was considering buying in 12 months for a tidy 30 to 40 percent profit.”
TUT,TUT, if you don’t have it written down or taped (taped with his permission) then you’ve got no wiggle room to stand on in litigation.But you did get a lesson you missed in school, college or your working tenure.
This is OT,but I’ll put it out. My background is heavily in the Auto Business. I have had some thoughts about how that business meets the Bubble.
American Auto sales have totaled about 15-17 Million new cars every year for the past 5-7 years. These are “about” numbers. The largest number of these sales have been Trucks or Midpriced cars. The Cheapest models have not been big sellers(for the most part) That said, How long did anybody think that the American public could keep fianacing 12,000 to 30,000 vehicles?
Since most people now trade every two-or three years,instead of the old
every September mode,you lose a significant part of your purchasing base every year. While cars wear out much faster than houses,with good care both can have long service lives. The perceived”need” to get a new car has been manufactured in our society. Other than mileage, and safety improvements,most cars are little better than ones made ten years ago.
So, there is not as much “need” to change cars, as “want” I suspect that what has happened in the housing market is the same. Houses are now commodities to be swapped (or down) often. We have confused Need(I have to live somewhere) with Want ( Iwant a nicer McMasion than that twit Debby has!) And so the cycle stars. It was ever thus, but “marketing” has quickened the cycle.
That should be $12,000 to $ 30,000 dollar vehicles.
Sorry.
Good comment but the problem isn’t the cheap vehicles. It’s the people who should be buying $12k cars who are financing $40k SUVs because the payment is doable.
Need for new cars, new houses, new anything is largely manufactured and rarely based on ‘need’. I continue to buy used vehicles (with one exception) that are at the end of their depreciation cycle. Friends think I’m nuts but my YEARLY vehicle cost (car + repairs, not counting insurance + gas) is around $300. I spend less on a car in one year than many spend in a month.
I am exactly the same way. Low overhead is the way to go. I used to always drive beaters. Years ago I was paying $250/yr for liability insurance only, same as today. I have family members that start planning their next new vehicle purchase before they ever pay off the old. Debt slavery, pure and simple.
Ah, yes. The blog of payment bears. I have 3 cars, no payments and about a 1/2 million miles between them. PL/PD insuance only, and make 90% of the repairs. A cheap hobby that saves some bucks.
I am the same way. I can stretch a beater till I get sick of it and treat myself to a different beater.
Ever have a minor fender bender, like backing into something, with a beater? You get to chuckle to yourself and say you gave it some more character. I doubt sheople making payments on a 40k ride feel the same way.
That is kind of what I was getting at. Even if you “need” a “new”(another or replacement) car, do you “need” an SUV or Pricey luxury car? Or do you need a car? I have a Minivan. It is fiananced. It will be the last one I buy for many years. My other car,a 3/4 ton truck. It is twenty years old. Does exactly what a new one does. Costs far less.
You and I are both zeroing in on how marketing “manufactures” needs and I submit housing is now subject to the same forces.
Exactly. “Need” is manufactured for everything from Starbucks lattes to SUVs. The issue I see with it is those least able to afford are the ones I observe spending the most. When I first graduated college I was paying $800 a month between car payments and insurance. Took about 6 months of that to get old really fast. For my doctorate thesis I’m considering writing a paper called “The SUV EFFECT” that details how people are sacrificing their future for the present desire to own things that are not in their best interest or make financial sense to own without considering the opportunity or future costs.
“THE SUV EFFECT.”
Is that the most recent documentary film with Al Gore ? It would make a great catastrophe film. “Invaion of Mars by the SUV people.” “The Empire against the SUV aliens .”
Have you heard? Ford wants to open a Explorer assembly plant on Mars. But they abandoned the plan. Lack of oxygen.
The only people I’ve ever met who trated in their car every September worked in the auto industry. I’ve never bought a new car in my life, although I did buy a zipply little mid-life-crisis-mobile that I didn’t need last year, for cash. Both me and my parents usually drive-’em till they die. My dad, for instance had a rabbit that was running on one cylinder for a while.
I am proud to say that I drive older, paid for used car. I will drive them (2 - one for me, one for wife) until they are completely used. They get me from here to there. If I need to drive a long distance, I can rent a new car for a short period of time at a reasonable rate ($20-25 per day/unlimited miles). Why buy a new POS and be in debt to another useless payment. THat is complete BS.
My dad told me the same thing once and I remember saying “why rent when I can just buy a nice car”
Thankfully I learned the folly of my ways. Driving a beater at home and renting for trips is the way to go.
I drove up to a roadblock once years ago and the trooper said: “I could write you a ticket but I can see that you don’t have much money”. LOL. Try getting some sympathy while driving a new Escalade.
I used to drive an old, paid-for car. Then some jerk totalled it on a hit-and-run.
The reasons we got a new vehicle at the time were a) we needed something really, really reliable, and b) the model we bought is of a type of car that otherwise doesn’t seem to exist otherwise (the six-seat not-an-SUV not-a-minivan job) and was only in its second model year. Oh yeah, there’s also c) the five-star safety rating, something I very much appreciated when ANOTHER idiot rear-ended us in ANOTHER hit-and-run.
(Both runners were caught and charged and #2 is facing prison time for DUI #3.)
However, our plan is to take really good care of it— yeah, we paid for the regular maintenance plan but we can afford it better now than later, when we have a family— and, essentially, drive it into the ground. Gently.
My brother just sold a minivan that he’d bought new almost fifteen years ago. It not only survived and thrived that long, but was driven from Illinois to California on a yearly basis, so it racked up the miles, too.
My point is that there is nothing inherently bad about buying new, IF you plan to take care of it and use it up. Yeah, it’s a depreciating asset, but for us, the knowledge that the car had been properly cared for from the start was worth the loss… and our bank has gap insurance, so we can never be upside down anyway.
A big part of the problem on the west coast of Florida is homeowner’s insurance, especially in the areas of Pasco and Hernando counties (referenced as Brooksville) in the article. People are receiving insurance bills for $4K to $5K on a ‘nothing’ home in that area. That is what is driving the number of sellers in the market at the moment.
Insurance crisis has Bush’s full attention
NBC2 News
Last updated on: 7/13/2006 6:05:49 PM
TALLAHASSEE: Florida Governor Jeb Bush’s office is getting buried in e-mails from home and business owners caught up in Florida’s insurance crisis. Angry homeowners who have been e-mailing the governor about the lack of affordable, or even available, insurance have gotten Bush’s attention.
“People are in constant communication with me, I can guarantee you. That is probably the number one short-term challenge our state faces,” said Bush.
Mary Bastien’s e-mail to Governor Bush is just one example of the insurance problems Florida citizens are facing. Her premium soared to $3,200 when a company called First Home bought her policy from Citizen’s Insurance.
Angela Milan’s mother in Pasco County called her in tears with a $5,300 premium that may end up costing Milan’s mother her home.
But not all of the e-mails are simply filled with complaints. Some of them offer ideas to help solve the problem. Bush says he is open to suggestions.
Donna Filipi of Shalimar would like to see a federal tax deduction on insurance premiums.
“Frankly I think right now, the approach ought to be to take everybody’s idea and put them on the table and vet them because this is a serious problem,” said Bush.
The problem is not just affecting homeowners though. Barbara Hunter of Fort Walton Beach writes that her business insurance policy was cancelled out of the blue and no other companies will give her windstorm coverage. She and her husband are afraid they’ll lose their small business and everything they’ve worked their whole lives for.
But the only solution to some home and business owners may be to leave Florida.
Now the Florida Office of Insurance Regulation wants to hear from business owners who are having problems paying for or getting commercial insurance.
I’d like to see an end to the subsidization of people who do not want to pay the full cost of their insurance. If you have the money to build on the beach, you should be able to buy insurance or be self-insured. We are suffering an insurance crisis in FL, much borne by the developers and greedy owners who want someone else to pay for their share of the moral hazard.
On the local news in the Tampa/ST. Petersburg area there was a piece on how businesses are looking to relocate out of florida due to the increasing cost of insurance and property tax!These jobs are in manufacturing, I beleive the person in the interview was a boat builder.
That really is the solution, PEOPLE JUST NEED TO LEAVE! They came initially because it used to be cheap in Florida and you could afford to put up with the hazards. It was a balanced risk. It makes no sense for the current infrastructure and prices to exist. If high costs force people to leave, the net effect would be for housing to freefall. If that $400 K house returned to $200K (where it was just 3 years ago), then there would be plenty of folks who would want to live in FL and would make a calculated risk decision of either paying high insurance rates OR assuming more of the risk personaly since the home cost less.
Seems like it would be a good time to check in with our friendly , honest realtor, Tom from Naples for an update.
Does anyone still have the link to his website?
http://www.naplesinsider.com/CurrentReport.htmer
Fun reading!
I just don’t get it. Went back to the area of Bradenton we are looking at yet again today. It’s called Lakewood Ranch. The number of houses for sale is just astounding! None of the houses have sold, nor have the sellers lowered the prices. There were even more houses up for sale! Several now have for rent signs as well! Of course they are asking $3K a month, which is absolutely ridiculous! When are the people finally going to start lowering the prices of these homes????????? Some of them are relo’s. Why don’t the relo companies cut their losses and lower? The builders are offering 50k in upgrades and of course they told us that was negotiable. I bet I could go in their and get $100k in upgrades. Problem is, the house is still too expensive.
Lizzie, I used to live out there. Shoot me an email to MrHousingBubble@aol.com
Thanks!
lizziebeth…you just need to wait and have some patience. Why the rush to buy now? If you just got to the area, then you should rent for at least a year. You obviously see the signs of the impending implosion. I visited a friend in Lithia a few weeks ago (Fishhawk Ranch)…nice masterplanned community in the middle of nowwhere. He really wanted to show us around so we went to several model homes, most which were in the $600-700K range. I though it was ridiculous, and though my wife thought it was rude, I asked him what he paid when he moved there 4 1/2 years ago…$195K. I told him there would be no friggin way I would ever pay the current asking prices, especially the insanity of knowing any fool that has been buying in there recently could be paying 3 times as much taxes as his neighbor. This area will see a big price fall soon, especially as the builders are forced to start slashing prices.