Bits Bucket And Craigslist Finds For August 14, 2006
Please post off-topic ideas, links and Craigslist finds here!
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Vacationing for a few days in San Diego. Everything you heard is true. The regional bird is indeed the Crane. The old city barely recognizeable. Traffic is what asstounds, I’d be at every council and board meeting insisting on a pause until the mess is fixxed. All the unmistakeable bubble signs and evidence of consumer exaustion are visible -if- you look. People aren’t looking. Ihave no idea what they are going to do with millions of square feet of residential and commercial space that will come on line and open up in the next year or so. They’ve even managed to kill the golden goose of tourism, 10.5% bed taxes and get this, parking at an exurban resort is an extra $8 night. Scripps Institute Aquarium is nice, Horton Mall still thrives, the trolley boondoggle runs mostly empty. There seems to be 3 separate societies running in parallel. An unfathomably poor hidden underclass doing menial jobs, a new urban rich city class and a large generic middle class. That’s all the news from Lake Woebegon…
All the unmistakeable bubble signs and evidence of consumer exaustion are visible -if- you look.
What would be the signs of consumer exhaustion in SD?
1) No waiting in the checkout lines at BigBoxMart stores (Costco, Home Depot, etc.)
2) Low density of foot traffic in shopping malls
3) No waiting and always-vacant tables at low-end and franchise restaurants (e.g., Soup Plantation)
4) Decreased traffic and short checkout lines at yuppie grocery stores (e.g., Trader Joe’s)
Went to the South Bay Galleria (mall for Torrance, Redondo, Hermosa, Manhattan, Hawthorne, etc) this past Saturday, at 2pm. Most crowded time at the mall, you say? Almost totally empty. Very few people walking around, and nobody carrying a huge stack of bags– most people had one or two small bags, and that’s it.
Maybe some people had gone to the beach or to the AVP match, but I’m guessing that people have tired of spending.
That is interesting since Trader Joe’s is actually cheaper than regular grocery stores. I would shop there if it weren’t so far away from my home.
Yes. It’s stange that Trader Joe’s is perceived as high end.
Trader Joes tells you their formula. They have low prices for staples and also carry gourmet items that have higher and sometimes much higher margins. They hope that if you save money on staples, that you will also try the gourmet items from time to time.
I think that it is a great formula and only wish they were a public company.
There is a sign in the store we frequent indicating that they are hiring. Especially in NoCarolina, Minnesota and one other place.
GS-
Have you noticed any reductions in road traffic as well, at least in certain locales?
Last Saturday ….50 Mile drive to San Francisco from Santa Clara … Dead on 280… evaully dead was Union Square. Usually the parking grage was full on bottom … have to take top floors… surprise surprise … we had 5th floor half empty. The street traffic of weekend buyers was equally lite. I have noticed this for the past 3 months. It was dead in the nite-clubs too.
Getstucco:
No waiting and always-vacant tables..
I happen to have gone with a group of friends this past
Saturday (8-12) to an event at Bowers museum in Santa
Ana.
Afterwards, we wanted to grab something to eat so we
went to the restaurant inside Nordstroms at Main Place.
(just down Main Street and across 5 frwy).
Anyway, the restaurant was totally
empty!. I had to ask the counter person if they were open!
We ended up with great service (3 waiters with nothing
to do). Even the manager came over and chewed the
fat for a while.
BTW, no much going on inside the store either.
5) Reservations unnecessary.
6) Clearance Aisles/Tables.
7) Low bag count at the mall.
9) Parking spaces at the resort including Sat night v. Mon morning.
“8) Billboard content.”
That reminds me — most of the major Wall Street builders’ billboards, which were ubiquitous around the interior ad space at Petco Park last summer, are MIA this August.
Robert,
I was in San Diego over the weekend as well and all I have to say is :
HOLY FREAKIN’ COW!
Seeing the pictures of all of the condos underconstruction is one thing, but actually seeing them in person is another. Absolutely amazing!
Robert & SLO;….I am going down there in October for a few days…Its been 10 years since I have been there…Sounds like it has changed a little ??
I have some pics of condos in San Diego on my blog
http://bubblemeter.blogspot.com/2006/08/pictures-from-san-diego.html
A good question, but I will give you my example. I am a resident of the San Diego area. This Saturday there was a friend in town for work, and we took advantage of his proximity and invited him out to dinner.
Our choice was a fantastic mexican resturant in the city’s “Old Town” district. This place is fairly famous.
So lets do the math - Saturday night / Tourist section of a tourism driven city / good resturant / 7PM - how long do you think the wait was for a table for 4?
If you guessed the place was half empty and we walked right in, give yourself a pat on the back.
To be honest, I was amazed.
well, what can you expect in a place with one of the most expensive gas, and the one of the worst cost of living affordability in the country. cost of living is comparable to silicon valley, and income is nowhere near that, los angeles fares much better.
You aren’t talking about Bandini’s? I’m a San Diego resident too. You couldn’t even get a damn parking spot in Old Town for the past few years. Bandini’s was ALWAYS packed to the gills.
Waaaaaahoooo! Here’s to having disposable income during a downturn!
One of the reasons for Old Town being a ghost town is the brilliant state of Cal booting out Bizaar Del Mundo owner Diane Powers. She MADE old town and now she’s gone and the Bazaar’s sales and restaraunts are down 60%.
That is a bigger than expected factor. My wife nearly refused to go there because of this exact issue, but one of our guests suggested it so we went. Food was excellent, service was prompt and well done. Beverages were large and potent. All in all the way a Saturday night with friends should be. The fact that there was no wait for a table was the most surprising thing.
I grew up in Phoenix, and everyone used to joke that you could see all your friends in San Diego in August since Phoenix emptied out in August when everyone was looking for someplace cool (as in not 110 degrees plus) to spend their vacation. You could usually see dozens of Arizona license plates at all the beach cottages, hotels, restaurants, etc. I haven’t been down there in years since moving out of state, and wonder if the AZ vacationers are still going there. They have to have some place to get out of the god forsaken heat. Maybe they’re at Disneyland…
“Maybe they’re at Disneyland…”
My wife was there yesterday, and told me the crowds were light.
I visit Denver frequently and see the traffic steadily increasing. Friday at 5:00 it was un-believable. Nothing more than a parking lot on I-25 moving at 15 mph from downtown north to Longmont. All I can say is if the FED or local government can’t stop this, nature will.
When I took my nine-year-old son to the Padres’ ballgame two weeks ago, he looked around at all those highrise condo towers under construction around Petco Park and asked me, “Are those cranes always there?”
Here is a new gimmick to selling homes:
http://bestbiddersale.net/
Signs all over the neighborhood stating: Home to be to sold to Best Bidder Sunday Night.
You are able to inspect the home over the weekend and leave a bid. The house I went to was a flipper remodel with a starting bid at $279K. Not sure how it turned out but when I went to the web site it said bidding was over and it directed me to the above property. The company marketing this process is http://www.5day.com
have no idea what they are going to do with millions of square feet of residential and commercial space that will come on line and open up in the next year or so.
I do. They’ll sell them at dirt-cheap prices and take huge losses. Many developers will declare bankruptcy!
The rest of us will be able to buy those condos, maybe for as little as 20 to 30 cents on the dollar.
Interestingly, downtown San Diego is one of the few places where condo developments make sense. They don’t make sense in Los Angeles and Long Beach, but San Diego is a genuinely beautiful and desirable place. The condo towers down there are perfect retirement destinations — at 25% of their current asking prices.
Desmo — do you know if $200K is a good/credible reserve price for that place?
“Woebegon” — LOL. Missing a word of Robert’s posts is like not finishing your wine.
I missed this thread over the weekend, but I’m wondering if the NAR succesfully jawboned the FED.
The FED does seem to be shifting to the view that owner-equivalent rent is the proper measure of inflation when housing prices are soaring (no your housing isn’t less affordable because rents are low) but housing prices are the proper measure on the way down (no your rent isn’t less affordable because housing prices are going down, even though you can’t afford them).
There is an article on the second opinion page of the Wall Street Journal today that argues the FED is essentially losing control of debt expansion and inflation, because the financial industry is working around it. Indeed, the current 5.25% short term rate seems high enough relative to inflation. But why are long term rates and cap rates so low, and stock PEs so high?
I can’t check to the day (because thehousingbubble2 blogspot seems to just redirect back here), but almost exactly a year ago I pointed out that this switch would be an absolutely surefire indicator that the housing market was over the peak and on the way down.
Ben might remember; he did respond to my post at the time.
Looks like an interesting article that I’ll have to go read. I suppose that it makes sense since, if our economy isn’t at it’s peak, because population growth is slowing, then the fed isn’t doing it’s traditional thing of trying to throttle and choke the growth. as far as I can tell, future inflation will be fought through “death taxes” which absorbs money as people die so there isn’t a huge money supply for fewer people.
I don’t know much about economics, but that thought was on my mind.
opps, I should have proof read better! Essentially, I wanted to compare the US economy to the “peak oil” situation. I wanted to say that the economy is at its peak and growth is slowing.
test
What is the purpose of these ‘tests’ that show up in ever single damn thread?
Sometimes when I post, it doesn’t show up for minutes to hours. But I learned that it (almost) will always show up at some point…that’s why you’ll often see double and even triple posts. Often the “test” is to avoid duplicate postings but to make sure a post will show up.
2nd try
fire sale at mills / mls to avoid bankruptsy
http://www.immobilienblasen.blogspot.com/
I found the ‘Pension Poaching’ article in your cite more interesting:
“”San Diego remains barred from raising money by selling bonds. Cut off from a vital source of cash, it has fallen behind on its maintenance of streets, storm drains and public buildings. Potholes are proliferating and beaches are closed because of sewage spills.”
Salinas;…Pension’s ??? Spoke with a design engineer in the electrical dept. of our city….He is retiring at the end of this year….$150K per year plus full benifits…He is 55…Police cheif just retired @ 190K…Think muni’s have legacy problems like GM & Ford ????
SCDave, County pensions for safety employees are the highest in the nation.The Ventura decision opened loopholes that will sink the counties in the future. Remember for most the pension is either computed on your ‘highest year salary’ or you ‘high three’. Thus enter the Ventura decision: All salary is now included (ie.overtime, uniform, etc) and someone making a base $50,000 salary can now kick this upto $100,000 to $150,000. CA voters better wake up and kick safety retirement to the curbs, and pass new legislation to repeal the Ventura decision. Remember safety retirement is expanding by adding new members to the ranks yearly: Cops, firemen, probation employees, prison guards, coroner investigators, etc. And with the expansion of the prison system, the bene’s to the prison guards is balooning out of control.
It is too late. Arnold tried ( with the safety retirements) and was nearly run back to Austria. The only thing to do is to move out of the state because it is doomed.
A pension of $150k a year. Something else.
I spent 23 years in the US Army, 7 years of that outside this country in miserable places. And my pension isn’t anywhere NEAR that. NOT EVEN CLOSE.
Insanity. I bet they get some big-time defaults in the very near future.
BK for San Diego is the only way out of the illegal underfunding of the pension mess.
i don’t have anything against these people earning those salaries, what is wrong with that? the problem is there is not enough revenue to support those salaries. these politicians keep on harping about tax cut and then want more pay for their contituent government employees. they just can’t have it both ways.
legacy costs indeed. sd has a woefully underfunded pension plan. apparently, the obligation to pay promised municipal pensions has never been challenged in court. what do you think will happen when sd tries to raise taxes by some ungodly % in order to pay people $150k/yr not to work? can you say “leave”?
you are dealing with politicians here. your guess will be a good as mine.
tryed to post the original link from msn but it hasn´t worked
What does it mean when a property @ ziprealty.com is INACTIVE?
Out of the MLS–likely under contract or expired.
What “under contract” means? Thanks
I think” under contract” means it sold but it hasn’t closed yet.
Quick question.
A co-worker’s brother went to refi and the Mortgage Company tried to dump $65K of fees into the loan. He cought it and told them to stuff it. He has a copy of the doc’s and she was asking me what agency would be the best to report it to? Any input is appeciated.
FYI; property is locatd in SoCal inland area, Hemet I think. 300K range and no it wasn’t the interest, obviously. I have heard of Mortgage companies doing this, but it’s weird when you know the people, even indirectly.
OCBear
Federal Trade Commission is responsible to monitor mortgage activities.
Website: http://www.ftc.gov
Telephone: (877) 382-HELP (4357)
Also go to http://www.dre.cahwnet.gov/mcomplnt.htm
Federal Trade Commsion is responsible to investigate mortgage activities.
Website: http://www.ftc.gov
Telephone: (877) 382-HELP (4357)
Also seehttp://www.dre.cahwnet.gov/mcomplnt.htm
TY, wawawa
65k in fee’s on a 300k loan? Come’on if thats true then he needs to take the paperwork to the feds. I don’t believe that unless the dude was paying off a wicked prepayment penalty or it was a hard money loan. Actually I think I’m gonna call BS on that.
I agree, maybe 6,500 dollars in bogus fees. (2 pts - seems to be stdrd scam).
Today I’m looking at the new July numbers for the outest-lying exurbs of D.C., Culpeper Co., VA, and Frederick Co., VA. These were the last to experience dramatic jumps in price in the last two years. A lot of cashed-out (or heloced) N. VA. folks turned to these counties to live in or to “invest”.
The former, 759 active listings, and 43 sold in July.
The latter, 1214 active listings, and 93 sold in July.
http://www.mris.com/reports/stats/route.cfm
http://www.mris.com/reports/stats/route.cfm
The MRIS data is *goofy*. Why categorize everything in such small increments up to 500K and then lump everything above 500K together? All the chart shows that way is a bunch of zeroes, and no way of knowing if some 10 mil house really skewed the results.
Never mind. I had the wrong “report type” checked.
Saw several signs by a HB over the weekend… “You buy our house, we’ll buy yours”. Guess the market for ‘move-up’ houses is dead due to the lack of sales of entry-level housing, so they have to do something!
Anyone else seeing offers from Home Builders to buy your existing house if you buy one of their new houses?
Yes. But the “specifics” would be pretty interesting to read.
DR Horton running a radio ad this am. “It’s a buyer’s market. Buy now at below market rates from DR Horton”
A Boise area listing:
“SELLERS ARE MOVTIVATED! Make an offer!”
http://boise.craigslist.org/rfs/193774049.html
Arizona area code for the contact number- another flipper in trouble?
Ari
Ari
That POS could be in any suburb in the U.S. Gack. Give me something with a little local vernacular.
80% of the new homes like that- it’s called “craftsman” style.
Did anybody see the Dateline report in Cali where they are interviewing two homeowners who hired a contractor to build custom multimillion dollar houses, and they got stiffed? The 20 to 30 something girl was bawling on national tv that the guy had stole more than her house, that he had stole her retirement!
I just thought WTF! My good job at a telecommunications company was stolen by incredibly stupid management, and there goes my retirement as well, but I have found another job, and am struggling to make ends meet. But this MF has the gall to go on national TV and state that her house being incomplete due to the General contractor had cost her her early retirement!
Now she is probably holding a multi-million half finished POS with a construction mortgage, and no income. Hope that she slowly roasts, and has to work the rest of her life in medfiocre jobs to teach her children (she will have lots of those, as condoms are expensive) the advantages of thinking before acting and building multi-million dollar homes that you know nothing about!
I saw the piece, but didn’t she imply that he stole her and her families retirement?
I think that she actually came out and said that the guy not only had stolen her house (she was on the hook for 100’s of thousands of dollars not paid to subs) but also took away her family’s retirement. I mean come on, isn’t she like 20?
Post a notice of Non-Responsibilty and it renders the sub’s leins mute….
What did she mean by her family’s retirement? Her mother and father’s maybe?
She said that her retirement. I literally puked right then and there and promptly put in a DVD….
If anyone here ever builds a house..make sure you write the checks directly to the subs, not the GC. This should be made clear to the GC way up front.
LCD TV’s for All
I went to Costco on Saturday. The place was generally dead except for a few milling about the awesome LCD TV sale they had. I decided to pick one up (after all that’s why I specifically went to Costco) and the guy said they had sold 30 on the first day they had them. Looks like most people are continuing to spend.
“Looks like most people are continuing to spend.”
However, there was an ominous recent development in much faster recent growth of credit card debt growth (aka methadone) relative to home equity debt (aka heroin) which suggests the consumption binge may be seeing its twilight.
What size and what brand did you get?
Are you happy with it? I am thinking to get one.
Vizio 42″ LCD display, it is beautiful and has a great picture. Highly recommend.
Ok, we (I) have gone completely off-topic here… but I looked for it and couldn’t find it. I got the 37″ Sceptre TV from Costco and was getting all-ready to work up a case of LCD-envy…
Not really, 42″ would have been too large for the space.
the height of a 37 inch standard screen is the same as the height of a 42 inch wide screen.
The Sceptre is an wide-screen LCD TV as well. The issue is width, not height. That and it’s hanging on the wall as well.
It’s in the store, not on the website. Check it out at http://www.vizioce.com
Bet it gets even better after Christmas.
Did you see that Mark Cuban has been calling Sony and begging to be the first mullet to pay 70K for that 100″ TV? Sickening.
Bet that TV is $7K within 3 years max.
I’d be surprised if he doesn’t already have a theater in his home. Hmmm…..maybe the 100″ is for his master bedroom. On the other hand, why in the hell would someone want to have a huge wall-sized TV screen. To match his ego, perhaps?
BayQT~
It is for his MB. He said that. That’s even sicker at his age.
Cuban is a little TOAD…..
A Toad Turd, scdave.
I watched some TV special (60 mins?) on him a couple of years ago. He literally warehouses his employees - large, windowless office full of cubicles. That guy is like a communist party leader - everyone suffers except him, of course.
Wanker.
Local flopper. A well known radio personality(?) who will:
“HAVE MY BUYERS/TENANTS MEET SOME OF MY ROCK STAR
FRIENDS WHEN THEY ARE IN TOWN!”
http://gainesville.craigslist.org/rfs/192869543.html
Excellent. An overpriced home and an exclusive audience with a rock star. Where’s my checkbook?
what an a$$hole.
Calling 5 acres a ‘farm’ is a bit of a stretch.
Any other young future homebuyers have an “Ah-ha!” moment recently? I’m normally very rational and logical, but it was hard to not think about buying last summer as I feared missing out on high appreciation and effectively losing money if I waited and saved a down payment. Fortunately, I found THBB.
But then this summer as I’ve been keeping an eye on houses, something struck me. I looked at a house and said “What if?” What if that house price fell by 30% or even 50%? With taxes, insurance, and maintenance, I’d save a little money over renting. But with the thought of high appreciation gone, I find myself saying “What’s the big deal? What’s the hurry to buy a house?” A house is a place to live, nothing to get too excited about. The thought of paying 4x median income for an ugly 1BR condo in a seedy area to “build equity” is so ridiculous if everyone would stop and think about it.
Even mountain homes, I asked “What if I could afford that?” I’d still have to furnish it, find time to go take care of it, deal with water and septic, pay taxes, etc., etc.
Once we break free of the mania mindset, it’s amazing how little urgency there is to buy a house. I still plan to do it, but I’m glad I have a better mind set now. Once this dawns on the general public, prices will fall significantly even in desirable areas.
I’ve never been of the mania mindset - just looking for a home, myself. And I agree with your post. But, much like I can’t see a reversal of thinking regarding debt and financing lifestyles on credit cards, I’m not sure this maniacal thinking will stop anytime soon. This is SUCH a huge runup. I see older folk who probably never envisioned getting filthy rich on their homes (a respectable growth of equity after living there all their lives? Hell yes! Filthy rich? Hell no!) now drooling over the prices they think they can sell for. And why shoudn’t they? That’s where things stand.
My point is that even minds that I think have been HUGEly rational for most of their lives are now caught up in this housing mania and I think it’s going to take a long time for the thinking to change. Short of an absolute teardown of our economy (including massive job losses) or World War 3, I just don’t see things changing all that much in the near future (and for the record, I don’t wish either evil on us). Maybe a slight drop in home prices, but nothing substantial.
My feeling has gone from hope 5 years ago, to downright depression over the runup and being left behind, to optimism when I found this blog, to indifference currently. I’ll continue to read up on the subject, I’ll continue to scour listings, and I’ll continue to save for a downpayment, but it feels so far away from my reality now I’m just exhausted.
I’m 30 right now. And according to the prices of things and my current surroundings now classifiable as poor. I just think that the number of people that bothered doing the math aren’t out there. I’m thinking about writing my Senators and Legislators and telling them to bail none of these people or banks out. If these people get away with my pricing me out on the way up and having taxpayers bail them out on the way down or destroying the dollar to save them. If China comes after us, I might end up on their side.
If I thought more people would get it, I’d make a bumper sticker that says:
“You’ve been homepwned n00b!!!11″
Now that’s funny. Print them and we will buy.
““You’ve been homepwned n00b!!!11″”
I don’t get this..please define.
Thanks.
All right.. this one requires that you are a financial nerd and a computer nerd.
“pwned” is a variation of “owned” and, in computer gaming speak, is used to refered to a total dominating of an opponent. e.g., “You got pwned!!” (pronounced “owned”).
Thus, to be homepwned means to be totally defeated (financially) in the process of being a homeowner.
n00b is pronounced “noob” and is short for newbie, someone new to a particular activity. In this case, real estate speculation.
So the phrase “homepwned noob!!” is something you might see if you were playing a real estate video game and you got waxed, except this is no game and there are hundreds of thousands of dollars at stake.
For further reading, I introduce you to the world of Leetspeak (scroll down for further discussions of pwned and n00b):
Leetspeak
“.. if China comes after us ..”
you’re safe, BB will pay them cash.
Eastcoaster and Andy — read the Daily Reckoning article that is posted on this blog today. It should allay a lot of your fears. As prices begin to fall, keep in mind that each succeeding sale helps adjust the comps downward for that neighborhood and, since the vast majority of buyers have to get financing, that is almost all it will take to guarantee a return to the mean. The only big unknow in how long that might take. Took 14+ years in Japan, but I believe their dynamics were a lot different — I believe our crash will be more like a falling elevator than a slow slide into quicksand.
You’ve got it, tlm! Add to that the unpleasant prospect of having the price go down for a few years and you see why at the end of a housing bust everybody thinks you’re crazy to buy… Which, of course, is the ideal time to do it!
I’ve seen a lot of t.v. ads recently warning that ARMs are resetting and “now’s the time to refinance into a fixed rate mortgage” at like 6.4% or something. Here’s my question: Isn’t it possible that there are many owners out there with ARMs that can actually afford to refinance into a fixed rate before the reset and just chose the ARM because it was so much cheaper initially? (Meaning resets will not be as catastrophic as is being forecasted.) Or am I giving people too much credit?
You are giving people too much credit.
So are the Banks.
“So are the banks.”
Good quick catch.
Yes, that is entirely possible. But keep in mind that housing is an illiquid asset and that prices are “set at the margins”. The people that can refinance do so. The people that can’t go into foreclosure and THOSE are the homes that set the new price and cause the death spiral for the next wave of FB’s.
here’s a stat. from a Pimco trader I found on OCregister this morning..it kind of answers your question in regards to pepole being able to “afford” refinancing.
Homeowners continue to use their homes as ATM machines. In the first quarter of 2006, 80% of refinancings were equity take-out refinancings. In more than half of the equity take-out refinancings, the homeowner refinanced into a higher rate to take out equity.
Basically, they can afford higher rates because they’re still sucking the equity out. probably to continue servicing the debt?
IMO, this is catastrophic, they are just able to extend the fuse as it is burning closer to the stick of dynamite.
And just before I read this reply, a friend of mine told me about her new plan to get rid of her debt (school loans, credit card bills, etc.). She and hubby are, you guessed it, taking out a home loan to pay everything else off. She’s looking to get the maximum amount she can. Translation: bye, bye equity. The kicker is she’s doing this now so that in 2 years they will be able to qualify for a loan to put an addition on their house. Is that odd to anyone else . . . tapping your equity dry, to pay off bills, to qualify for a future loan?…
I simply asked her “What if” the property value drops in the coming months/years? Can she be at peace with being underwater? She can. Why? The credit card bills are at some ungodly interest rate so she sees it as an improvement. Plus, they don’t plan to move for a long, long, long time.
It would absolutely, positively make my head explode if I had to play these finanical games to pay down debt. I may not have a house, but I also have zero debt and savings accumulating.
From my experience having been a loan officer, manager of a loan office, appraiser and having worked for a builder (all before I found religion :)), most of the time people buy the biggest home with the most upgrades that they can qualify for. So if they purchased a home with an ARM whrere they qualified at 1% plus the start rate, then they coudln’t possibly qualify for a fixed rate refi, just based on payment to income ratio. What I have been hearing is that people are refi’ing into new arms at a higher start rate (when they have had enough of an increase in their earnings to qualify). But the average person will make the same that they are making today, five years from now (not counting minor COLA annual increases that are disguised as raises).
Builders make the most money from the upgrades. The builder I worked for had a goal set of 10% to 20% of the base price, for upgrades. Basically whatever the buyer(s) would qualify for, they threw in. Thos ein SoCal may know them, they used to have a great big design center next to the 55 Freeway in the OC. They build terrible homes. I used to have to go to the new homeowners’ to get a recent paystub so that I could send the loan off. When I would arrive, invariably they would take me around and show me all of the taped items that hadn’t been fixed (even though the builder assured them that if they just signed off on the dotted line during the walk-thru, that they would be back next week to fix everything). The homeowners always told me they wished they hadn’t bought from that builder…
Santa Barbara OKs Housing Aid for Folks Making Up to $160,000 a Year
In a city where the median home price is over $1 million, a planned condo project’s units will be priced below market from $495,000 to $595,000. Teachers, nurses, police are among the expected buyers.
As if they need more financial rope to BK themselves. Good idea: tax funded indebtedness. NOT!
Uh Oh….Wait until Cote see’s this…..
I don’t get surprised by this crap anymore. Poliyicos have entirely abrogated any moral standing on these issues. They don’t even ask if there’s any authority to do something nevermind if they should do something. My blog is weighed down with my “affordable” rants. SB is just off in their own plane of reality.
No, what really got my blood boiling was the “Ventura Decision” dissussed way above. I was literarly in the room for that outrage. I even tried in private meetings to get County Counsel to issue an opinion that the resolution was unconstitutional. While he agreed it was illegal he wouldn’t go up against the DA and Sheriff. This is why people should never see either sausage or laws being made.
In Sacramento we have a local realtor who runs a web site “Keeping it Real in Sacramento” last week she wrote this.
There is clearly enough evidence out there today to say the growth in available homes for sale is slowing. As you know if you read my Blog regularly I keep a pretty close eye on inventory and one of the sites I like is HousingTracker. Although their definition of “Sacramento” includes some but not all of the surrounding area I think it is a good indicator of where we stand on inventory. As of today they showed 12,048 homes on the market which is only up 25 homes from a week ago.
I thought we might see a surge in homes hitting the market after the heat wave but that did not happen. The available inventory is clearly a number most controlled by new listings as the number of sold/pending is still a trickle. Having said that, even though the “buy before school starts” selling has passed, I think we may see our first declines over the next month.
Few days later inventory in Sacramento made a nice jump upwards. Most of her comments do not even make sense.
I thought Suzanne was working the lines in Navada ???
Wow! $10! Don’t spend it all in one place!
Miller wants to cut tax rate by a penny
10:59 AM CDT on Monday, August 14, 2006
By EMILY RAMSHAW and DAVE LEVINTHAL / The Dallas Morning News
Dallas Mayor Laura Miller said Monday she hopes to push the city’s property tax rate down a full penny – lower than the quarter-cent reduction City Manager Mary Suhm recommended on Friday.
And she said she’s orchestrating a group of council members to comb through the proposed 2006-07 budget in search of cuts.
“I think we ought to be able to knock a penny off the rate with some ease,” Ms. Miller said from California, where she’s visiting her kids at summer camp. “We’ll look at what all is in there. I think it’s incumbent upon us to make some cuts.”
Ms. Suhm, meanwhile, said an additional quarter-cent might be doable. A full penny would be nearly impossible to reach, she said, but “if the council wants to look at that, we certainly will.”
The $2.34 billion budget unveiled by Ms. Suhm on Friday includes Dallas’ first property tax decrease in eight years. It’s attributable to a $6 billion increase in Dallas’ property tax base, Ms. Suhm said, the result of widespread commercial growth and new construction.
Dallas City Council members took their first crack at the budget in a Monday briefing.
The city manager’s proposed quarter-cent decrease, which would knock a few dollars off the average homeowner’s bill, is equivalent to about $2 million citywide. A full penny reduction would cut the budget by about $7.4 million, and return about $10 to the average homeowner, Ms. Suhm said.
“There are a couple of council members who would just like to eat up a quarter cent and call it a day,” the mayor said. “I think it’s critical … to show we’re prudent and responsible.”
Ms. Miller said she’s not yet sure what areas she’d like to cut to further lower the tax rate. She said some of her colleagues have mentioned public safety, which is slated to get about $35 million in improvements.
And she thinks the civilian merit pay - an average 4 percent raise - “is rather robust.”
“That was the first one I really honed in on,” she said. “As usual, I don’t feel any traction from council members to reduce that.”
Ms. Suhm’s proposed 2006-07 budget:
•Calls for some $35 million in public safety improvements, including adding 100 police officers and 92 new cruisers - on top of routine auto replacement - to the Dallas department’s ranks.
•Installs a highly-publicized police recruitment and compensation plan, and fortifies the department’s overtime budget.
•Adds 13 employees in the city’s 911/311 operation and gives Dallas Fire-Rescue $1.2 million for a long-awaited physical fitness bonus program.
•Allocates operating funds to bring all city streets up to an 87 percent satisfactory rating.
•Continues the performance-based merit raise system for civilian employees at an average 4 percent.
•Sets aside some $27 million for rising fuel and electricity costs.
E-mail eramshaw@dallasnews.com and dlevinthal@dallasnews.com
Post on what to do if you’re losing your home:
http://eugene.craigslist.org/rts/192153904.html
Hopefully this posts, as none of my comments have appeared before (and I’ve checked the next day and they’re still not there!)
Am helping my mother find a new home. She’s very representative of what’s been going on these last few years. She works in the luxury furniture business and during the boom times, was able to buy a huge McMansion that sits half-empty. Over the last couple of years though, sales have slowed down and her income has dropped. She could no longer afford her massive mortgage, so instead of selling the house, she repeatedly refinanced, using the money to pay for her mortgage and always hoping her income would go back up to what it once was. During that time she also bought a Luxury SUV and a large-screen TV and all manner of other useless stuff that she didn’t really need. When I asked her how she was going to pay for my siblings’ college (I’m the oldest and have already graduated), she insisted she’d just refinance for that too, because the market was never going to go down. Pure financial insanity, compounded by a slowing economy.
Reality has finally hit. She’s mired in debt, has very little equity in her house and keeps insisting that soon, the market will continue its meteoric rise. I’m trying to save her from bankruptcy, because she’s my Mom and she’s a good woman (except when it comes to finances). Have been helping to cover her mortgage for the last three months (shudder) while we look for a new home for her and my siblings. We live in Montgomery County Maryland and were looking in the Gaithersburg/Northern Potomac area and here’s what I saw this weekend:
1. Half of the homes shown had Price Reduced signs. Lots of incentives as well.
2. People who were looking were doing just that, just looking. Some mentioned that they had tried to sell their own homes but couldn’t and pulled the homes off the market.
3. Signs have popped up that now say, “In danger of foreclosure, we can help!”
4. Big range of pricing in homes. Some realistic, some absolutely crazy. The ones that are priced unrealistically just aren’t moving, and the owners/flippers seem shocked by this. The worst that we saw was an older townhouse in a good part of town. The th had a price-reduced sign and a big fenced backyard, which my mother needs for her dogs, so I thought maybe this could be a good fixer-upper deal. It was clear from the outside the place was uncared for. Huge weeds in the front, even though the agent was holding an open house. We walk in and the place was a mess and completely empty. No furniture and plenty of signs of a flipper…some half-assed improvements that were badly done, but the place still looked horrible, mostly because it wasn’t clean, but everything was just done sloppily, including the scariest backyard I’d ever seen, with grass you might see on African safari, thigh-high and massive weeds! For this mess the agent wanted 469,000 and that was with the priced reduced!
This is why I love my Mom. She turns to the agent and says bluntly, and not in a mean way, “This house will never sell for this price. I’m a saleswoman, this will not sell.” She then pointed out that for the same price, we had seen much, much, MUCH better. My mother then pointed out to the agent some of the problems with the house that hadn’t been addressed.
I’ll be keeping my eye on that property, because I really am curious if it will ever sell!
Your Mom hasn’t sold her McMansion yet and you’re out shopping for new homes? It’s a good idea to look around and get a feel for what’s available, but you’d be better off spending your time getting the current house sold imo. Still, that’s a sad tale. Are your siblings almost old enough to be out of the house? If so, maybe your Mother would consider another location that a lot less expensive?
I know, I know. The purpose of the outing was to show my mother that there were lower-priced homes out there that she could be perfectly happy in. Living in McMansionville, she had been led to believe that if it didn’t have a two story foyer and a sunken jacuzzi tub, with separate shower, that it wasn’t worth living in.
Now that she’s seen that she will have somewhere to move to, she’s more willing to put the house on the market. She still has an unrealistic notion of what she’ll get for the house though and how long it’ll take to sell, so am working on that next (she has enough equity, by conservative estimates, for a decent down payment nonetheless) .
Both my brother and sister will be out of the house in 2-3 years. It’s just the two of them and my mother though, so she doesn’t need a big place, certainly not what she has now. She should be able to get an older little rambler with a nice yard for the dogs in a decent neighborhood and be financially all right and have enough room for everyone. That’s what I’m aiming for.
Just wanted to quickly add, in case my comments come off wrong. Been lurking here a long time and have been learning from you all. I definitely appreciate your comments.
This is exactly why I think that home prices are going to hang on for so long before adjusting downward– that FBs are going to hold out until the very end, drawing their mortgage payment from everywhere they possibly can, before the whole system ends in collapse taking a lot of peoples savings down for the ride.
This is all so bad for the national economy in so very very many ways.
Sigh.
Where were you when your mother was making all those idiotic decisions?
Trying to reason with her every step of the way, Sammy.
Your mother has created her own mess, not you. If she puts her house on the market in the next two weeks at 10% below what the comps are listed at, she at least has three months to get lucky. After Thanksgiving you can’t sell a house north of Virginia even in a normal market until late February. Any procrastination or optimism after today spells disaster (for her, not you or your siblings - you’re young), and it’s her own fault, not yours. Offer strong advice, but then forget it - she brought you into the world, not vice versa.
Unbelievable, by an Arizona Mortgage Broker:
Buy Today Owen Your Owen home!
CALL TODAY @ 1-623-242-6609 ASK FOR MIKE
REFI
BUY A INVESTMENT HOME
FREE INFO ON HOW TO BUY A HOME
LEARN HOW TO MAKE MONEY BY REFINANCEING
1% RATES OAC
NO JOB
LOW FICO
LATES
CALL TO FIND OUT WHAT IS GOING ON IN THE MORTGAGE BIZ
http://flagstaff.craigslist.org/apa/187598084.html
He/she must be into country music — making two-syllable words out of ones.
Or maybe they meant, “Owe on…”
First off - if this is really an ad, it is illegal per Federal Law (TILA - Reg Z). You can’t quote rates on a non-existent loan. And as far as I know, you cant qualify for a loan (even a NINA or Stated) without having a job. And to lie on the loan app is a Federal crime…
But I guess this just goes to show you how unethical the AZ R.E. governing bodies are. They should be pulling that person’s license, but probably wont….
Buy now before you’re priced out again, just like 2000: http://orangecounty.craigslist.org/rfs/191393919.html
Stainless Steel appliances? Check!
Marble countertops? Check!
Flat Panel TV hung over fireplace? Check!
“Huge” backyard with privacy fence? Check!
Yep. Definitely worth WAY more than a half million dollars! Only two questions:
1) If it *is* such a good deal why isn’t the realtor snapping it up for himself as he threatens to do in the ad?
2) Is it really a good idea to hang an FP over a fireplace?
3) Learn how to spell (Bargin!) before posting.
And leave off the exclamation marks!!!!!
I under-read your #2…..I saw it as ‘Is it really a good idea to hang an FB over a fireplace?”
LOL. We might agree to feed the squirrels, but the FBs will have to fend for themselves.
I am curious about why bankruptcy filings are listed on sites like foreclosure.com
I know that bankruptcies have been at record lows in CA the last few years due to MEW. So if someone is filing Chapter 7, there is probably no equity left.
So if that is the case, how would knowledge of their bankruptcy filing be useful?
Banktruptcy stalls foreclosure process.
from http://forum.freeadvice.com
http://forum.freeadvice.com/showthread.php?t=332022
“What is the name of your state? California
I bought two houses back in December and January.
House #1 I was supposed to keep and rent out. I got a little money back from signing the loan. It was to be used to keep the house for a couple of months,”till refi” he said. Months passed, I ran out of money-Agent doesnt answer my calls. Now its in foreclosure. Tenants still live there.
House #2 realestate agent advised me to sign for was so that I could make money. “Might need it to cover the first house…” ect. Agreement was I would sign for it temperarily, later have it tranfered. If the people living in the house missed a payment before they could tranfer the name, the property became mine. All in writing-he said it was done all the time. People stopped paying pretty much as soon as they moved in. I have been hounding this guy for months.
First I got the phone calls. He said tell them you’ll pay next month. Then came the letters of foreclosure-he said they were just tryin to scare me. I recently talked to a financial advisor that used to do realestate and she advised I get legal help.
I dont trust agents and loan officers all want to refi. I dont know what to do. ”
An FB who apparently followed the financial advice of a real estate agent. I mean REALTOR. What a surprise that he has been left holding the bag.
http://forum.freeadvice.com/showthread.php?t=332022
Guy bought two houses on the advice of a real estate agent. Now he wonders why the agent doesn’t return his calls. Maybe it’s because the agent already got his money? Or maybe I’m just too cynical.
You can smell the desparation. This listing has been on craiglist for something like 6 months. It used to be at $430k. Now it’s at $400k. And they’ve added that it’s a “Feng Shui” apartment.
http://sfbay.craigslist.org/eby/rfs/193599026.html
Feng Shui? Oh yeah, I’ll pay an extra $50k for that! And another $50k for the granite counters!
I think this place is worth more like $275k.
275k?? for what. Let’s try 60 or 70k by what i see in the pictures
nice, cramped dated kitchen, dated bath, tiny bedrooms, dark inside. Wheres my obligatory granite countertops ?