July 30, 2006

‘It’s Less Good’ For The ‘Ponzi Carnival’

The news this Sunday is the price-problem recognition by the media. “Around the country, houses that used to sell in days are now sitting on the market for months. After five years of paradise for sellers, once again it’s a buyer’s market. The pressure now is on sellers, and especially builders, as the market is saturated with a record glut of unsold homes for buyers to choose from.”

“‘In terms of closing sales, they have got to offer significant discounts,’ said Ivy Zelman, housing analyst for Credit Suisse First Boston. ‘I have builders right now who are advertising make me an offer, which is definitely scary.’”

“Zellman said that high prices are things of the past for now. ‘People are going to have to come to the reality that if they want to sell their house,’ Zelman said. ‘They’re going to have to lower the price.’”

“Chevy Chase is one of those Washington, D.C., neighborhoods where lots of folks want to live. Although prices have softened only slightly so far, bidding wars are now a thing of the past as buyers mull over an inventory of unsold homes that has tripled since the same time last year.”

“‘We just don’t know if it’s the right time to buy anymore,’ says Ruth Zitner, who has been shopping for a home in the neighborhood for the past year. ‘So we’ve decided to just wait and see.’”

“That attitude is fast turning the housing market on its head, in once hot neighborhoods from South Florida to San Francisco. The nation’s largest home builders are reporting rising cancellations of orders for new homes. Meanwhile, nationwide sales of existing homes fell by 8.9 percent in June, compared with a year earlier, and by as much as twice that in places like Boston.”

“With sellers increasingly anxious to unload their properties, inventories of unsold homes have swelled to more than a six-month supply, an increase of over 50 percent in a year.”

“‘Sellers have tried to hang in there and get their price,’ says David Wyss, chief economist at Standard & Poor’s. ‘But there comes a point where they’ll have to give in.’”

From New Hampshire. “The latest headlines on the subject of existing home sales confirmed what everyone connected to the residential real estate industry has known for almost a year, it’s a marshmallow soft market and getting softer by the month.”

“When I talked to a few local Realtors, they confirmed the trends. Kathy Rush said, ‘We have double the listings on the market. We don’t have double the buyers.’”

“The psychology of the buyer pool has changed. As one agent told me, the residential real estate market of the past five to six years was like a voluntary Ponzi scheme with all the participants assuming they could make hefty and relatively quick profits from their investments.”

“Pam Bailey said she underwent training initiated by Coldwell Banker earlier this year. The goal was to really educate sellers that the market had shifted and, though they won’t say it, but I will, the Ponzi carnival was, if not over, then certainly sidelined.”

“‘This isn’t rocket science,’ said Angela Stamoulos, the training manager for Coldwell Banker. ‘We do a lot of analysis and we saw the amount of inventory. We saw different things that needed to be emphasized. We used real data to educate sellers on what’s happening,’ Stamoulos said. ‘There are always buyers, but it’s that homes are most likely overpriced.’”

“Barbara, the seller of the house she’s lived in for nearly five decades and who asked that I not give her full name, (said), ‘It was very helpful that Pam explained the market to me. When we first hooked up, the market was good. Now, it’s less good.’”




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98 Comments »

Comment by Vmaxer
2006-07-30 14:51:17

“Ponzi Carnival” Finally some agents are characterizing the past market for what it was.

Comment by Ben Jones
2006-07-30 15:28:21

I don’t know if the writer is a realtor. I’ll say it again, the folks in New Hampshire talk straight.

Comment by michael
2006-07-30 17:42:52

“Butler said she’s seen a “bottleneck” effect on the middle-market price range of $350,000 to $550,000. The jam is being caused by likely buyers who can’t sell their own homes and therefore can’t buy their next house.”

Maybe that’s the middle in Hampton (beach area) but that’s pretty expensive for a good chunk of the rest of NH.

 
 
Comment by Vmaxer
2006-07-30 16:05:20

I’m staring to see some sellers in New York advertising that they are desperate and near foreclosure. I have a feeling some of these sellers are not really desperate and are using it as a ploy to make people think they are getting a great deal. Thus ridding themselves of their over priced property on some naive dope.

Comment by Pen
2006-07-30 16:14:33

Yep..I’m starting to see auctions in my area, but they are not of the foreclosure kind. Rather, they are owner auctions. I wonder if this would be a good way to go, if all properties were sold that way. I wonder if this would bring out truly fair market values.

Comment by Vmaxer
2006-07-30 16:28:34

It’s a way for the brokers to get the few buyers there are together, into a competitive bidding situation. People associate the word “auction” in real estate to be the same as a foreclosure auction. It’s a manipulative technique to get retail buyers to overpay.

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Comment by jdd
2006-07-30 17:53:47

They would only if there were no reserve price. In fact, the reserve price is the list price and there will not be an auction unless it is too low.

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Comment by Price_Doubt
2006-07-30 17:39:54

Yeah, that would be a good NY strategy, LOL.

 
 
Comment by Derek H
2006-07-30 16:51:44

The acceptance phase of the bubble is finally starting to kick in when even realtors say things like “this isn’t rocket science”. We knew it all along — yeah, right.

 
 
Comment by greenlander
2006-07-30 15:05:49

I still object to this market being called a “buyers’ market.” A buyers’ market is when an asset trades below its intrinsic value.

If an asset’s price goes from being 2.5x its intinsic value to being 2.0x its intrinsic value, it’s still a sellers’ market.

Comment by GetStucco
2006-07-30 15:10:18

Calling the current market a “buyers’ market” is definitely part of the Ponzi carnival.

 
Comment by ric
2006-07-30 15:16:20

I agree wholehearedly. Right now, it’s a fool’s market, as in buy now and watch your negative equity grow.

Comment by Backstage
2006-07-30 16:06:30

Fool’s Market…..That’s the right spin.

It immediately made me think of Fools Gold. Just when you thought you were rich, disappointment took you. Your ‘valuable’ merchandise turns into something not worth lugging around.

Comment by looking4mee
2006-07-30 16:33:42

Funny thing, I recall a Twilight Zone episode where 3 robbers where escaping into the desert with 100lbs of gold. After 2 of the robbers died, the lone survivor kept walking and was only able to carry 1 single bar. He made it to a road (but thus being the Twilight Zone, it was one hundred years later) where he collapsed. A car pulled up (from the future) and the guy offered his single bar of gold for some water. The man in the car looked at the gold and laughed, simply tossing it onto the ground. He then stated how odd it was that someone would be carrying a worthless rock around in the desert like it had any value.

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Comment by feepness
2006-07-30 19:34:47

This is one of my favorite episodes of the Twilight Zone. Here is an actual synposis:

“Four thieves rob a bullion train headed to California. They head back to a cave, and use a gas invented by their leader Farwell, and go into suspended animation. One of them is killed by a rock while they’re asleep. The rest awake one hundred years later, safe from any police pursuit. DeCruz uses the truck to run over Brooks, but loses control and wrecks it. Farwell and DeCruz must walk through the desert to the nearest town, carrying as much gold as they can. Farwell, the older of the two, quickly tires. He loses his canteen and has to pay DeCruz one gold bar for each sip of water. Then Decruz raises the price to two gold bars, and Farwell kills him with one of the gold bars. Weak and tired, Farwell heads down a highway while carrying the gold he refuses to abandon. Just as he finally collapses, a futuristic car pulls up. He offers his gold in exchange for a ride into town, but it’s too late, and he dies - never learning that a way to make gold had been found, making his bullion worthless.”

“One sip, one bar of gold.”

 
Comment by GetStucco
2006-07-31 05:58:48

That Twilight Zone episode sounds like a great cautionary tale for those currently putting all faith into gold turning into the next bubble.

 
Comment by feepness
2006-07-31 07:42:59

I’m not putting all my faith into gold, but I am putting about 10-20% of my funds into commodities. I think you can have a bit of faith in the gold argument without being a gold bug.

 
Comment by Marc Authier
2006-07-31 16:22:50

Commodities that you can eat, drink or heat with are great. By the way, water stocks are a great place to put your money.

 
 
Comment by pismobear
2006-07-30 18:17:04

Reminds me of the Billy Crystal/Jack Palance movie of a few years ago, ‘Curleys Gold’. Boxes of lead bars painted with gold paint in a fake mine.

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Comment by Joe Momma
2006-07-30 15:28:19

Yep. When the houses were going up the buyers could say they were getting an appreciating asset. So in many ways the last few years have been a buyers market in that what they bought was sure to increase in value. But today, it is really a sellers market. Anyone getting out anywhere near these levels is selling high. Very high.

It won’t be a buyers market for a decade. Maybe more.

Comment by Polo Bear
2006-07-30 16:20:10

It may be a buyers market in three years. Nobody truly knows.

Comment by sm_landlord
2006-07-30 17:04:32

I’m guessing 3 to 5 years, but like you said….

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Comment by Max
2006-07-30 22:49:47

I’m with Joe Momma, ten years, if ever.

 
 
 
 
Comment by Vmaxer
2006-07-30 15:55:31

There were “Experts” calling the Nasdaq and tech stocks a good buy for years after it peaked, all the way down.

Comment by Home_a_Loan
2006-07-30 16:23:57

Yeah, I enjoyed reading this from itulip.com:
http://www.itulip.com/awards.htm

Great chronology of Jim “Real Money” Cramer pumping stocks all the way down the hole.

Comment by Pen
2006-07-30 16:29:50

@#!$^! … I really hate these “gurus”. I really hate that they sell their worthless advice and then stand behind the fine print. They are no better than the snake-oil salesmen of the old days.

I wish people would learn to stay away from the books, tapes, newsletter, etc.

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Comment by Max
2006-07-30 22:53:06

“If you want to get an idea of a mathematical infinity, think of human stupidity” (c) A. Einstein

People will never stop buying books, tapes, mindlessly trade without knowing, etc. Fools provide a valuable service by providing others with money.

 
Comment by OutofSanDiego
2006-07-31 04:19:46

Though OT, another great example fools throwing away their money decade after decade are diet pills and exercise equipment. The same stuff since I was a kid (I’m 46). The biggest scam going since black and white T.V. Early Saturday mornings almost every cable channel is schilling a magic diet pill or exercise machine…the rest of the channels are get rich quick programs.

 
 
 
 
Comment by RentinginNJ
2006-07-30 16:19:50

It’s definitely still a sellers market. It’s just that most sellers have become so spoiled with buyers fighting amongst themselves for the privilege of purchasing their overpriced crackerbox, that they are just too stupid to realize it.

If you price your house aggressively and didn’t but in the last year or two and didn’t cash out all your equity, you can still make a killing. There are still buyjers out there. You will just need to settle for 2x what your house is worth rather than 2.5x.

This reminds me of all the talk about “bargains” when the NASDAQ started to head down. Looking back, who was smarter? The person who “cut their losses” and sold their Lucent Technologies at $70 or the one who refused to sell until it went back to $100?

Comment by Trojan Horse
2006-07-30 17:35:50

“if…(you) didn’t cash out all your equity”.

As my grandpa likes to say “If “if’s” and “but’s” were candy and nuts we’d all have a merry christmas”

Just talked to a cousin in Visalia about the housing market up there. He’s an owner, and for the past year every time I try to talk to him about selling because of the coming crash, he has said “yes, but my house is in the lower range of the market, so it will always be easy to sell”. When I pointed out that the houses above his range would soon be in his range, his eyes would gloss over and he’d ask me to pass the potatoes. Anyway, today he said he’s gotta sell. Said he has a few neighbors who are in real trouble, and he’s thinking a lot of people are in the same boat. Seems one of them bought a house 2 years ago for $300K, and several cash-out refi’s later they now have a 625K mortgage with nothing to show for it but a wardrobe full of Uggs and a couple of quickly depreciating Cadillacs.

If people didn’t cash out all their equity indeed…

Comment by Chilipepr
2006-07-31 05:15:03

“Seems one of them bought a house 2 years ago for $300K, and several cash-out refi’s later they now have a 625K mortgage with nothing to show for it.”

And just imagine this guy DOES get 625k for his place…. if he is single, at the end of the year her will have an addition 25k tax bill!!!! (unless some of that appreciation was due to improvements. He only has a 25ok tax free appreciation)

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Comment by jim A
2006-07-31 06:56:52

The term “buyers market” DOES NOT mean that prices are low. It means that there are more sellers than buyers. It therefore means that prices are going down, not that they are near their nadir.

 
 
Comment by GetStucco
2006-07-30 15:05:50

“‘Sellers have tried to hang in there and get their price,’ says David Wyss, chief economist at Standard & Poor’s. ‘But there comes a point where they’ll have to give in.’”

That point is when a combination of negative cash flow and dashed hopes for a return to a rate of housing price inflation which rationalizes living with negative cash flow forces flippers and Option-ARMed-and-dangerous homeowners to say Uncle.

Comment by lefantome
2006-07-31 11:57:43

This is precisely the reason I am amazed that anyone would be buying property at this time … even if it did look to be a great deal. The “Uncle” condition is coming.

The sellers are like someone holding their breath. They can look pretty normal at first, with their smarmy “I’m doing just great thank-you-very-much” fake look pasted across their face. Just wait ….. the face turns red (October 2006) ….. the eyes bulge (October 2007) ….. and finally, PHAAAAA(exhale) , HUHHHHH (inhale) …. capitulation.

They know their “investment” doesn’t make any sense. They were only kidding themselves ….. unless of course, they can kid you now.

 
 
Comment by GetStucco
2006-07-30 15:09:07

“The psychology of the buyer pool has changed. As one agent told me, the residential real estate market of the past five to six years was like a voluntary Ponzi scheme with all the participants assuming they could make hefty and relatively quick profits from their investments.”

I guess that explains why some folks decided the time was right to buy two, three, or even ten houses?

 
Comment by Sammy Schadenfreude
2006-07-30 15:13:12

“Pam Bailey said she underwent training initiated by Coldwell Banker earlier this year. The goal was to really educate sellers that the market had shifted and, though they won’t say it, but I will, the Ponzi carnival was, if not over, then certainly sidelined.”

Bet that’s not what Coldwell realtors were telling their clients earlier this year.

Comment by ric
2006-07-30 15:17:37

I wonder what their “buyer training” program says.

Comment by Sammy Schadenfreude
2006-07-30 15:23:16

“There’s no better time to buy than now.” What else would their buyer fleecing, er, training program say?

 
 
Comment by boulderbo
2006-07-30 16:24:11

can anyone say “short sale”?

Comment by tom stone
2006-07-30 17:19:03

i have been seeing short sales for a month in santa rosa ca.short by 30-50k,on 2004 purchses,10% down.

 
Comment by rentfornow
2006-07-30 23:44:36

Just received two listings from my broker in Boulder CO. Both in very desirable neighborhoods. Both had been pulled from the market and relisted. One down 100K and one down 25K.

 
 
 
Comment by GetStucco
2006-07-30 15:17:05

Interesting byline here:

“Housing: It’s a Buyer’s Market

Housing Prices Are Finally Coming Down, Giving Buyer’s a Break”

So let’s get this straight: Prices are literally “coming down”??? Can someone remind me how many short months ago a bevy of experts from David Liar-eah to Leslie Appleton-Young to Realtors (TM) pretty much all over were assuring us that prices never fall?

Comment by looking4mee
2006-07-30 15:41:42

“David Liar-eah”

that was too good!

Comment by GetStucco
2006-07-30 15:51:27

In fairness, someone else here originated that one, and it has been often repeated!

Comment by CharlesM
2006-07-31 09:10:03

It’s even more fun as “David Liarrhea” because he runs at the mouth, and talks a lot of… poop. :)

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Comment by Marc Authier
2006-07-31 16:28:15

Poop makes the world go around.

 
 
 
 
 
Comment by GetStucco
2006-07-30 15:20:56

“The latest headlines on the subject of existing home sales confirmed what everyone connected to the residential real estate industry has known for almost a year, it’s a marshmallow soft market and getting softer by the month.”

It’s not a bubble, nor a deflating balloon, nor a soft landing, nor bird, nor plane … IT’S A SOFTENING MARSHALLOW!

Take note of the new moniker, Leslie A-Y!

Comment by greenlander
2006-07-30 15:23:55

I thought it was a souffle.

 
Comment by Sunsetbeachguy
2006-07-30 17:04:36

Oh no the Sta-puft Marshmallow man. Everyone is going to end up coated in sticky marshmallow goo.

Comment by We Rent!
2006-07-30 17:51:26

WHAT, Ray? WHAT just “popped” in there?

 
Comment by Portland Mainer
2006-07-30 19:29:44

I tried to think of the most harmless thing
… something that could never destroy us
… something I loved from my childhood.

The Stay-Puft Marshmallow Man! He was on
all the packages we used to buy when I was
a kid. We used to roast Stay-Puft
marshmallows at Camp Waconda!

 
 
 
Comment by stanleyjohnson
2006-07-30 15:30:11

how or where would I go to see if any properties were sold in last year by LAY or Lereah, their spouses, parents orchildren?
and of course no replacement of those sold homes.

 
Comment by Thundereater
2006-07-30 15:30:19

Can I nominate “Less Good”?

“When we first hooked up, the market was good. Now, it’s less good”

This made got me! LOL
How about,
“This week housing starts were off 3%, another sing the market is Less Good”

Comment by looking4mee
2006-07-30 15:45:29

As interest rates become less good, the price of my home looks more bad, so buy my house now before the good gets bad, and the bad gets less good!

 
Comment by sm_landlord
2006-07-30 15:50:37

I’m waiting until it’s double-plus ungood.

Now, where’s my soma?

Comment by feepness
2006-07-31 00:57:48

Please don’t mix my 1984 and Brave New World. I do love them both… just not… together. They are very different. One uses fear, the other… luxury.

 
 
Comment by Pen
2006-07-30 15:52:21

Coming to a housing bubble near your…

Houses of a Lesser Good, starring David Leareh.

 
 
Comment by Thundereater
2006-07-30 15:34:06

Er, “another SIGN”
& “This really got me”

My first day with the new fingers,Right……

Comment by looking4mee
2006-07-30 15:49:38

I thought you did that on purpose

 
 
Comment by looking4mee
2006-07-30 15:38:59

‘There are always buyers, but it’s that homes are most likely overpriced.’”

You Think! Hmm, 800K for a 2/1 home might be slightly a little tiny bit overpriced, for what, maybe 95% of the country!

Comment by marin_explorer
2006-07-30 22:41:03

There are always buyers…

It’s actually less good than that, as home sales were frontloaded by people afraid of “being priced out forever”.

 
 
Comment by Spucky
2006-07-30 15:42:46

The head of the MA realtors association was on the news 2 nights ago. He said “people got in over their heads with all the risky mortgages, now they have to sell.” And pray tell, who pushed them into this? The real estate industry perhaps? When I sold one house and bought another 3 years ago, the leeches were all over me to buy a more expensive house because I could “afford” it with all the “special finanacing” available. Well, the worm has really turned, hasn’t it?

Comment by Pen
2006-07-30 15:45:57

Special Financing:)..sort of like special needs..do you get a helmet and a ride on the short bus with those loan products?

 
 
Comment by John Law
2006-07-30 15:49:09

floppers, mr. toll and realtors fear these people.

(“‘We just don’t know if it’s the right time to buy anymore,’ says Ruth Zitner, who has been shopping for a home in the neighborhood for the past year. ‘So we’ve decided to just wait and see.’”)

 
Comment by Pen
2006-07-30 15:49:31

I’d like to see a scatter plot that plots home price quintiles vs. income quintiles for each state. Then, I would like to see how many people in each income quintile could afford the median priced home within the quintile, assuming a 30yr fixed with 20% down.

Comment by GetStucco
2006-07-30 15:55:38

Pen –

You are on the right track here. I think the right way to measure affordability is exactly along the lines you are suggesting: Line up the percentile points on the permanent income distribution with the percentile points on the distribution of housing market values, and then come up with a measure which provides a meaningful comparison. Forget about assuming a 20% downpayment with a 30-year fixed mortgage in a market where almost everyone buys with Option ARMs…

Comment by Pen
2006-07-30 15:59:17

thanks.

I realize most folks don’t use convential financing, but I added to have some “rationalization” added. If 1% teaser rate products were to be used, then I fear that would distort what I think is the true state of affairs.

Comment by Pen
2006-07-30 16:00:55

s/h/b conventional financing

blogs need spellcheck

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Comment by jim A
2006-07-31 07:03:15

And how have the bubble prices that people got for their previous homes allowed them to use leverage to pay even more for their move-up house? I do wonder how this sort of extreeme will affect prices when this unwinds.

 
 
 
Comment by Robin
2006-07-30 15:50:39

then: theyre not making any more land
now: theyre not making any more buyers

Comment by Pen
2006-07-30 15:53:57

Just started seeing building lots available with “No builder tie-in”.

So much for land scarcity…

Comment by sm_landlord
2006-07-30 17:01:30

Here’s what I want to see on the available lots adverts:

1. No deed restrictions
2. No special assessment districts
3. Local zoning board certifiably sane
4. No New Yorkers or Californians allowed in local government
and
5. No Builder tie-in.

Comment by ex-Californian
2006-07-30 19:05:47

I’m curious why I see so many people associate deed restrictions with HOA’s and brown-shirt enforcement of trivial regulations.

Out here (an unincorporated area near Dallas), you’d have a hard time finding a place without some deed restrictions, and if you did find it the bank might not be too crazy about it. If you needed a mortgage.

Without deed restrictions there’d be nothing to stop your neighbor from building a hog pen right on the property line or moving his extended family into a group of mobile homes on his lot.

Deed restrictions aren’t synonymous with HOAs.

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Comment by sm_landlord
2006-07-30 20:13:55

“Without deed restrictions there’d be nothing to stop your neighbor from building a hog pen right on the property line or moving his extended family into a group of mobile homes on his lot.”

That’s what zoning is supposed to be for. Ag vs Single-family vs multi-family. Deed restrictions and zoning have both been abused, but zoning can be changed if the community changes, while deed restrictions are a bear to fix. Remember when houses came with deed restrictions that the property could not be sold to Negros or Jews? That took two acts of Congress to undo.

See Ths NYTimes Article from 1989 for a discussion, and that article was written before things went crazy again in the recent bubble.

 
 
 
 
 
Comment by Larry Littlefield
2006-07-30 17:42:16

(Just started seeing building lots available with “No builder tie-in”.)

Just started hearing heavy advertizing on Newsradio88 in New York encourging people to buy land. “Anyone can do it — a great investment.”

Funny. No ads like that while the bubble was still inflating.

 
Comment by Home_a_Loan
2006-07-30 18:07:44

“Suzanne researched this!”
“You can do this!”

Poor, poor schleps. Sorry, had to get it out. :D

 
Comment by michael
2006-07-30 18:18:39

More Ponzi Fuel:

Morgan Stanley to help home buyers

By Jim Pickard,Property Correspondent

Published: July 30 2006 22:10 | Last updated: July 30 2006 22:10

Morgan Stanley, the US investment bank, is set to launch a product aimed at allowing homeowners to borrow much more money than traditional lenders permit, in exchange for giving up some of the future increase in the value of their houses.

http://www.ft.com/cms/s/6e7f9fbc-1ffa-11db-9913-0000779e2340.html

Comment by Tulkinghorn
2006-07-30 18:38:08

What smart-ass Harvard MBA came up with that one?

 
Comment by Chip
2006-07-30 19:03:57

“Morgan Stanley is likely to insulate itself from any lending risk by processing the loans through the capital markets, although not necessarily through securitisation.”

That fine print will getcha every time.

 
Comment by seattle price drop
2006-07-30 19:27:42

Now that is one heck of an idea. But I wonder how many people will be interested in buying an overpriced home if they know they’ll be giving up a percentage of future appreciation? I guess we’ll see just how ridiculous Americans really are.

This loan also asumes that an awful lot of people are still in the dark re. the shaky (at best) housing market. IMO, while there are still some very silly buyers out there, the numbers of people who are aware that RE *could* crash is rising exponentially in just the past couple weeks.

Let’s just get it over with and go back to 20% down/15/30 year fixed.

Also, this Morgan Stanley scheme sounds like usury at it’s best, like it ought to be illegal.

 
Comment by sm_landlord
2006-07-30 20:21:06

Yes, kids, your own private hedge fund to buy a house through!

I just want to know where they’ll find fools to take the other side of that bet - loaning 150% to a flipper, and betting that trees grow to the sky.

 
Comment by GetStucco
2006-07-31 06:08:45

Are the funds provided by the Plunge Protection Team?

 
 
Comment by KIA
2006-07-30 19:20:50

The similarities between now and 1929 are still growing. Here is an article explaining that 60% of the entire U.S. is currently in drought conditions: http://www.wtop.com/?nid=104&sid=864856 . The harvest is not yet in. Prolonged drought could severely affect the food supply this fall. Record-setting heat has engulfed the midwest and, in fact, most of the nation, causing energy consumption to soar.

Hurricanes shook up the Gulf Coast last year and may do so again this year. War is brewing in the middle east. What these mean for productivity, energy consumption, oil availability, transportation and labor availability (draft!) etc. are complete unknowns.

Now we have confirmation of what we have predicted all along: laws of gravity and economics have not been suspended, the housing market is in dire trouble, and will probably collapse on its own excesses. Inventories have tripled or more. Prices are sagging, and stories of those caught at the peak are legion.

I’m trying real hard not to catastrophize right now, but I’m apparently failing. I keep getting brush-offs from people who utter bland assurances like “Everything’s just fine” or “You worry too much.” Shouldn’t someone be nearly panicked about the combination of punches headed our way? Even if they’re not panicked, some level of concern is certainly appropriate… isn’t it?

Comment by Death_spiral
2006-07-30 20:15:22

Don’t worry, everything will work out OK…

lmao

We are hosed!! Time to strap on the helmet and head for the nearest shelter.

 
Comment by Jay_Huhman
2006-07-31 07:23:59

The hard red winter wheat areas are hard hit by the drought but the corn and soybeans crops look very good right now.

60% of the country might be in a drought but crop production is concentrated in areas which are not affected.

 
 
Comment by Portland Mainer
2006-07-30 19:35:52

Late this afternoon I drove back to Portland from 210 miles north of here. I averaged a steady 75 MPH. Most of the cars on the road had Maine plates. But no less than 50% of the cars passing me had Mass. plates. I couldn’t help thinking this was one of the ways they earned their nickname.

Comment by Housingbear
2006-07-30 21:49:06

That be mass holes? lol

Comment by Portland Mainer
2006-07-31 03:54:49

That be it.

 
 
Comment by snake_eyes
2006-07-31 02:36:10

MA drivers are the worst in the nation. ME is a close second.

Snake Eyes (NH)

Comment by tandemrepeat
2006-07-31 05:59:41

Nope - MD/DC drivers are the worse by a looong way! :)

Comment by Sunsetbeachguy
2006-07-31 08:13:03

Nope, OR drivers are the worst west of the Missippi River.

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Comment by RedwoodBob
2006-07-31 09:09:15

I’ve found that east coast drivers tend to drive ridiculously fast, but are more aware of their surroundings (other cars, traffic lights, YIELD signs, etc…). Conversely on the west coast, drivers drive “safer” (slower) but have NO awareness of anything going on around them.

 
 
Comment by DC economist
2006-07-31 08:57:05

Another vote for VA/MD/DC drivers being the worst. And I’m from NYC. NY drivers drive aggresively, but at least they know how to drive. Here in DC, they are still pretty aggresive, but they also can’t drive. They can’t merge, so any large merge blocks traffic for miles. I can’t imagine any zipper merge like those entering the Holland Tunnel working here.

The only place I’ve seen worse driving than DC is Atlanta.

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Comment by michelleshocked
2006-07-31 10:59:08

ditto. i lived in nyc for 2 straight years and a number of summers. NEVER saw an accident in the city. the drivers are aggressive, aware, quick and they use their signals because nobody has time for an accident. dc….slow and stupid.

 
 
 
 
 
Comment by Eastofwest
2006-07-30 19:46:55

” We used real data to educate sellers on what’s happening,’ Stamoulos said. ”

….I am absolutely sure she showed the buyers the statistical data to the buyers the last few years right? Price have run up %250 ,and may correct at some point ..No? ..were’s that big red Cramer button..Sell,sell,sell……

 
Comment by bruin
2006-07-31 01:15:30

I just created a bookmarklet that automatically takes you to the Zillow page corresponding to the address of the property you are looking at on Zip Realty. Many people are probably already doing this by copying and pasting.

This way you can look up the sales history on a listing without the extra work.

Wow, I need to go to bed now.

Comment by bruin
2006-07-31 01:16:41

The link would be nice huh?

http://cleverjunk.blogspot.com/

or you can click my name…

 
Comment by asuwest2
2006-08-01 09:31:04

thx. cool tool.

 
 
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