‘A Fundamental Shift Is Occurring’
The Arizona Daily Star reports from Tucson. “Some people living near The Greens at Ventana Canyon have wondered what is happening with a condo conversion that started there at the beginning of the year and doesn’t appear to have made much progress in the meantime.”
“‘My daughter and I walked through there and it was like a ghost town,’ said Angie Calderon, who lives in the adjacent complex, which has been undergoing a condo conversion of its own. ‘It looked like they had started working and then had to stop.’”
“The project is moving forward, said Anthony Contreras, for The Ryness Co., which is handling sales and marketing for Canada-based 20/20 Properties, the company that bought the 20-year-old apartments to convert them. ‘It’s definitely not a ghost town. There’s great units out there. We’re not going to have a problem selling them,’ Contreras said.”
“Though the company held a lottery drawing in March because there were more qualified buyers than units, it didn’t receive approval until mid-May to begin actual sales, a detail that may have contributed to the perceived slowdown, said Dino Paone, a mortgage lender who has dealt with several condo projects in Tucson.”
“Paone said the condo market had ‘kind of a double-whammy’ in Tucson over the last several months. ‘There’s so many choices right now for buyers. The market..won’t go back to where it’s been over the past two years. That kind of frenzy only happens every 15 years or so, he said. ‘Will it be like it was two years ago? No, it just won’t.’”
The East Valley Tribune. “Superstition Vistas, the Arizona Land Department’s much-touted grand experiment in new urbanism, is about to face its first real-world trial at a time when the market isn’t exactly clamoring for new development.”
“The recent, failed state land auction at Desert Ridge shouldn’t be interpreted as a sign that the development community will pull a noshow at the Lost Dutchman Heights sale, said Richard Hubbard, also a former deputy land commissioner.”
“The land was appraised at nearly $462,000 an acre early this year, when trust land at Desert Ridge was selling for up to $1 million an acre. The department plans to hold another auction Sept. 28, but deputy land commissioner Jamie Hogue said she isn’t expecting it to turn out any better. ‘We’re getting the perception that there’s not much interest,’ she said.”
The Arizona Republic. “Home buyers hopeful to recoup their earnest money from shuttered home builder Turner-Dunn have found themselves at the back of a long and frustrating line. Most home buyers paid $2,500 or $5,000 in earnest money. But some, like Gerald and Barbara McCurdy of Caledonia, Ill., plunked down nearly $28,000 because, they said Turner-Dunn charged them more for buying an investment home. ‘We’re just hoping it works out,’ Barbara McCurdy said. ‘But we haven’t heard from them since May.’”
“Turner-Dunn’s attorney, Alan Meda, said about 90 homes were 85 to 90 percent finished. But since construction ceased in the spring, many have deteriorated from summer heat, monsoon storms and neglect, and it’s uncertain how much work would have to be redone. ‘We’re very motivated to get these homes closed,’ Meda said.”
The Reno Gazette Journal from Nevada. “Sales of existing single-family homes in Reno-Sparks fell 41 percent in August compared with August 2005, extending the streak of double-digit, year-over-year losses by percentage in every month this year. In the greater Reno-Sparks area, the median price fell to $325,000, 10 percent below August of last year and the third consecutive year-over-year drop.”
“In Reno, the median price fell to $388,200, down 9 percent from August 2005. Sparks dropped 5 percent, to $320,000 and the North Valleys dropped 7 percent, to $265,000, in August compared with August 2005.”
“Also in the report, prices for existing condos and townhomes in the Reno area dropped 17 percent in August, to $165,100, compared with August ‘05. In July, the median for condos was $165,000. Carson City also posted a decrease in August, down 8 percent, to $309,000, compared with the same month a year ago.”
“None of this comes as a surprise to Stephen Haley, president of the Reno-Sparks Association of Realtors. ‘There is some correction going on,’ Haley said. ‘We have not had any major job layoffs, and every time we’ve seen a drop in values there has been layoffs. I don’t see that happening.’”
The Review Journal in Las Vegas. “A fundamental shift is occurring in the type of housing offered in Las Vegas, a real estate executive said. ‘Developers still reap the benefits of higher density where land values are justified, yet they can build and sell these units at $250 a square foot instead of $350 a square foot, capturing a larger percentage of the home-buying market,’ Ken Perlman said.”
“Sales of new homes have slid 37 percent from a year ago, Sullivan Group President Tim Sullivan noted. The pain isn’t going away soon. Look for reduction in prices and home builder incentives to continue well into 2007, Sullivan said.”
“Operating profit growth for home builders sank from 44 percent in 2004 and 47 percent in 2005 to an estimated negative 18 percent this year and negative 52 percent in 2007, Credit Suisse reported. How are home builders coping? Some have laid off staff, Sullivan said; others shrank their business and are now walking away from deals or renegotiating deals.”
“That is not the time to buy condos,” Paone said, That kind of frenzy only happens every 15 years or so, he said. With 265 total units in the complex at 800 to 1,200 square feet, they’re selling at $180,000 to $285,000.”
Overpriced Tucson condos for everyone!
- “The project is moving forward, said Anthony Contreras, for The Ryness Co.,
- the company that bought the 20-year-old apartments to convert them.
- ‘It’s definitely not a ghost town.
- There’s great units out there.
- We’re not going to have a problem selling them,
Wow! What in the hell is this guy smoking?
What else could he possibly say? I’d love to be inside his head just after he makes those statements.
I know Ben’s site was down most of the yesterday, but I got a new post up regarding the OC Register article from this past weekend.
http://www.housingbubblecasualty.com
That said, I will be posting more frequently again. I will post more info on the blog the next week or so.
Thanks!
SoCalMtgGuy
You bastard, I used to be addicted to your site as well. Then you cut us off cold turkey. Now you tease us with these monthly installments. Well, it doesn’t cut it. Think of all of us junkies you’ve abandoned in the gutter.
I am also addicted to his site as well as Ben’s. I know that he posted that he has a new job/career–so I guess we should cut him so slack. But not too much. We junkies are an impatient crowd. Keep us stoked–post more often.
I will get into more detail later….but I gave my 2 weeks notice….I’m done at the end of the month.
Driving 700-1000 miles per week all over SoCal got old…quickly.
Look for more postings…and a few other things to be coming down the pipe.
I missed the blogging… so stay tuned!
SoCalMtgGuy
http://www.housingbubblecasualty.com
Let me guess…you quit your job to become a Realtor?
How did you guess????
bwahahahahhahahh.
NOPE…
I have a few options that will allow me to spend more time on the computer…than on the road.
SoCalMtgGuy
http://www.housingbubblecasualty.com
$225/sf for new construction! Wow! At these prices are the plumbing fixtures and door hinges in these closets gold plated or solid gold?
My ex thought $240 per square foot for a condo conversion in West Palm Beach was reasonable when he bought it in March. It now appraises at $136K ($20k less than purchase price in 6 months). Purchase price included the ‘upgrade’ package (new window a/c, ‘granite’ kitchen countertop, and carpet) so I’m sure it was a great deal.
“The land was appraised at nearly $462,000 an acre early this year, when trust land at Desert Ridge was selling for up to $1 million an acre. The department plans to hold another auction Sept. 28, but deputy land commissioner Jamie Hogue said she isn’t expecting it to turn out any better. ‘We’re getting the perception that there’s not much interest,’ she said.”
That’s nice. At least they’re getting a perception.
Related note regarding that land…I know it well, I was a USFS ranger in the Superstitions and know people who thought it’d be cool to build on the south slopes….there are so many rattlesnakes that no one dared to go out to the back patios at night. One builder, who built 4-5 homes, killed something like 45 rattlers in about a 30 day period.
There are some places where people should not be. Artificial air, water, and other support systems will ultimately fail.
Makes me sick. Why must they be killed. Don’t answer that.
I know…truly sickening…the desert is just as fragile as Artic tundra…the animals/reptiles are highly specialized in their niche…remove one, and the whole ecosytem is in trouble.
There’s a type of desert toad out in AZ that secretes a slime from its skin that has hallucenigenic properties. Naturally, the poor toads have to contend with fried-brain stoners who pick them up and lick them for an LSD-like trip. Think of the emotional scars those poor little creatures must have (the toads, not the hippies).
Me too. And why do people bring desert tortoises home with them? Leave them in the desert where they belong.
This trust land is all over Arizona in muti-thousand acre blocks. It isn’t neccesarily forests or environmentally important. From what I understand it is left over from the homestead days. Nearby, it is rented to cattle ranchers for less than what it costs to keep the fences up. Why doesn’t Arizona free up all this land?
Free it up for what?
Rattlesnake habitat, of course.
For its best use or non-use. Running cows is pretty hard on the land.
Yes. Though it would be sad if human cows with their 64-ounce sodas, suvs and tract houses wound up on it.
manraygun - Hahahaha… human cows with 64oz sodas, I love it.
Sorry, Ben, but I disagree about “running cows is pretty hard on the land”. Oh, it can be, I guess, if the rancher is foolish and overstocks. If you’re in it for the long term, you graze carefully, watch your stocking rate, rotational graze, and hope to make enough in the good years to survive the bad. I think a lot of Tom Lassiter, who developed the Beefmaster breed. Minimal drugs, natural selection, he even liked fireants (loosened the soil).
You can be a foolish rancher, but you can’t be foolish long.
No, cattle grazing has a massive environmental impact. There’s no denying it. They aren’t sheep but still they turn natural landscapes into feed lots witihn months that in the arid Southwest take decades to repair. I’m not anti-cattle but I’m not wearing rose colored glases either.
Just out of curiousity, how bad was the damage all the buffalo grazing throughout the midwest caused in earlier times? I suspect they caused a lot more “damage” to the environment than cows. I’m going to agree with Sonic Boomer: done right, cows don’t have a “massive environmental impact”. I’ve heard of plans in Oregon to start letting buffalo loose and many people say it’s a bad idea because it would cause too much environmental damage. To me, it seems like buffalo belong roaming around.
I agree. Buffalo do belong roaming around. If the praries thrived for thousands of years with the buffalo then why can’t they again?
Just out of curiousity, how bad was the damage all the buffalo grazing throughout the midwest caused in earlier times? I suspect they caused a lot more “damage” to the environment than cows.
Depends upon your perspective. The buffalo were adapted to the environment and vice versa. Cows are restricted in range and located in delicate ecosyststems. There are a few ecogroups that actually outbid ranchers for grazing rights on public lands.
Robert, I would have to disagree. Cattle range well from Alberta to Mexico, and from California to Florida. Longhorns were a superb adaptation to the brush country of SW Texas. I’ve worked cattle on BLM leases in Colorado, and when we pulled them off in October the grass was green and the streams were clear. Sure, you can screw it up, but you don’t have to.
A rancher who is leasing the land has no financial incentive to concern himself with the long term. If ranching is truly profitable, the land should be sold for the few pennies it’s worth and then let the ranchers take care of it as an asset. Having the government involved just distorts the market.
Answer: There were never buffalo herds in southern Arizona.
Also, buffalo are smarter and better adapted to the N American ecology than cows, and they also were able to live and migrate freely over enormous distances, unlike now.
If a buffalo ended up in Phoenix, he’d want out, and wouldn’t eat whatever little scraps of desert plants managed to grow there.
The buffalo of the great plains grazed the grass but were forced to move regularly by predators. The recently grazed grass undergoes a brief root die-off and ramps up for new grass production. The dying roots enrich and build up the soil and grazed grass initially grows faster right after grazing. THe buffalo couldn’t stick around and overgraze due to predators and they are off to graze a new area. The buffalo, grass, and predators coevolved and the cycle of this process gave rise to the rich farmlands of the great plains.
Robert, I would have to disagree. Cattle range well from Alberta to Mexico, and from California to Florida.
You mean after we cut off their balls and ship them to their open air prisons they rarely escape? I know, way over the top. Cattle are domesticated agribusiness biopharma raw material. These medicated genetics experiments with hooves do to natural ecosystems what lawyers do to companies.
Now, now. Calm down. We’ll hear all about the “good rancher” and the vehement objections to the accusations of medicating and bioengineering and how “my cows are happy and natural.” Frankly I don’t want to hear about that fraction of a percent even if you are or think you are part of that tiny fraction. Please don’t hold up the exception as a rule.
If you haven’t, folks should read Omnivore’s Dilemma–talks about both sides. 1) The exceptional farms are very productive, but it takes lots of knowhow, and lots of work, and cost–and there are very few of them– 2) Where most of us get our beef is generally not nearly as sustainable–feedlots, feeding corn, not grasses–and the cows are sick because of it–they were never meant to eat corn, we just feed them corn because it is cheap energy.
Check out http://www.eatwild.com for some good places to buy from some of the exceptions.
Yes, I have also read Omnivore’s Dilemma. I also recommend it very highly.
I have read that cows graze a lot closer to the ground than buffalo and in semi-arid areas will end up killing the grass and exposing the top soil.
[quote] “The land was appraised at nearly $462,000 an acre early this year, when trust land at Desert Ridge was selling for up to $1 million an acre.[/quote]
Does this land have gold on it? If not then what in the world does it have that makes it worth up to one million acre with nothing on it?
Are you kidding?
Arizona is totally built out. There is no land anywhere to build on. they are in a severe land crisis. Ignore the billions of acres of land the gov’t has to auction off. Ignore the stretches of desert as far as the eye can see. Ignore the massive developments they’re putting up in Kingman etc.
I kid you not, for some odd reason people think there’s a land shortage in Arizona. I stood on some hill and looked… as far as I could see…. nothing. But don’t try to tell that to the bulls in Arizona.
There literally is nothing on that land. No water, no plant life that isn’t poisonous or have inch-long thorns, no wildlife except a few fire ants. Central and western Arizona is a total wasteland. $1 million an acre is amazing.
The land was appraised at nearly $462,000 an acre early this year, when trust land at Desert Ridge was selling for up to $1 million an acre
$1mil for an acre of scrub?
You gotta be shitt’en me.
Tulip Bulb Mania Re-Deux…
I agree. Maybe the population has exploded or there has been a breakout of greenery due to Global Warming, El Nino or something else but when I was a kid we did a coast to coast road trip in our trusty Dodge Dart and I don’t remember seeing shit between Fort Worth and L.A . except rocks and cactuses and there weren’t that many of those cool giant cactuses either.
I work for the forest service here in Bend, the developers cut down the trees just like the snakes in Arizona. What is the matter with people? I just picked up a flyer on the corner where I live, $425,000 for a knock down “as is” .52 of an acre.
- “None of this comes as a surprise to Stephen Haley, president of the Reno-Sparks Association of Realtors. ‘There is some correction going on,’ Haley said. ‘We have not had any major job layoffs, and every time we’ve seen a drop in values there has been layoffs. I don’t see that happening.’”
Steve can not see any layoffs coming …
And what a joke, existing condos selling for $165,000??? What’s that? A closet? We looked at a studio at the redeveloped Montage on Saturday during the River Walk Wine Tour. $200,000. and on the side without a good view.
Layoffs are a lagging indicator of the economic activity. Don’t these clowns know that? When the economy bounces back, there still will be layoffs.
Somewhat off topic to the article, but I saw this data out of Fannie Mae yesterday. It has the latest estimate on the ARMs that will reset next year:
http://www.fanniemae.com/media/pdf/berson/monthly/2006/092006.pdf;jsessionid=NKCXWMFK2JUSFJ2FECISFGA
“a rough estimate of the total dollar volume of first-lien loans that are scheduled to reset next year would be $1.1 trillion with an additional $300 billion set to reset the following year. Making the less conservative assumption that half of all unsecuritized mortgages are one-year ARMs (and the other half are FRMs) results in an estimate of roughly $2.2 trillion for the total dollar volume of first-lien mortgages set to reset in 2007 with an additional $200 billion scheduled to next reset in 2008.
… and don’t frickin panic you’ll only make things worse.
__________________________________________
lmao. Read the comments from the Reno story.
“But if you are going to panic–panic first”–who should be credited with that statement?
Also in the report, prices for existing condos and townhomes in the Reno area dropped 17 percent in August, to $165,100, compared with August ‘05
______________________________________
Bubble has not burst?!?!?
posted on an upper thread but will post again here:
And what a joke, existing condos selling for $165,000??? What’s that? A closet? We looked at a studio at the redeveloped Montage on Saturday during the River Walk Wine Tour. $200,000. and on the side without a good view.
This is crazy! NO way should 20 year old apartments be selling for up to $285k, the people here have literally gone nuts!
Naming a condo conversion company “20/20 Properties” is hilarious. Buying a place like that could not have demonstrated less vision. The entity should be called “Myopia Properties.”
It makes more sense in the context: Hindsight is 20/20. The buyers of those properties will have plenty of hindsight to spare.
“Naming a condo conversion company “20/20 Properties” is hilarious.”
Maybe Jon Stossel will do an investigation
Ya’ll have a peek at the bond market . . .
Yeah, I know..is the tail wagging the dog?
^TNX (ten year notes) are absolutely dropping in rate. Great for the bond holders…
Things are starting to get interesting.
Neil
Great for the homebuilders.
hahahahahahaha
Ten year rates are dropping because they are discounting the economic recession/depression that lies ahead. It’s only good news to builders and the stock market in the near term - until they figure out their profits are going to go in the toilet.
Nice inversion
How bout the Dow? Up by 65 awhile ago. I stop for lunch/dishes and now we’re down by 82?
In fact, at 1:12EST Gold is only domestic market listing on Marketwatch in green!
that might be partly my fault.
with Ben’s site down, I decided to “rebalance” my portfolio.
I transferred a fair amount of my stocks into Treasury mutual funds, Gold, Silver, and an international stock fund.
sorry… I didn’t realize I was such a market mover!
I called my broker in New York last night and made some inquiries about shorting. I think the word is out that the foreign money coming back to the States is taking short positions!
I’ve had pretend short positions over the last year. Be careful. few markets are acting rationally at this time. I’ve watched time and time again as my pretend puts on the homebuilders stay out of the money and expire worthless. I also had some pretend shorts out there, and watched time and time again as my shorts would have been squeezed silly.
In a rational market, it would seem that the equities market should tank, especially homebuilders, mortgage lenders, and hedge funds. but the timing is the problem. and the various markets are far from rational
It seems like any day though the market should correct (downwards) and reflect all the bad news that’s out and coming down the pipeline. but that any day might be a year away.
good luck
“I transferred a fair amount of my stocks into Treasury mutual funds, Gold, Silver, and an international stock fund.”
Brilliant! XLNT timing. Now, you need to hold on for a wild ride. P.S. nix the Int’l and rotate to physical instead of paper PM’s. I wish you were wrong in your motivation, but I fear you’re right. I do find the “buy gold” ads I’ve seen on TV and print a bit disconcerting though. Kinda reminds me of the elevator operator giving stock picks or the Jeff the Taco Bell manager with 10 houses.
Stocks down, bonds up -
Philly Fed points to stalling economy:
http://money.cnn.com/2006/09/21/news/economy/philly.reut/index.htm?postversion=2006092112
Another home price warning:
http://money.cnn.com/2006/09/21/real_estate/still_overvalued_housing/index.htm?postversion=2006092111
‘We have not had any major job layoffs, and every time we’ve seen a drop in values there has been layoffs. I don’t see that happening.’”
This idiot acts like NNV is some corporate Mecca oozing with high paying wage jobs. What spurred on Reno market was almost purely speculation (mostly Cali money) and RE created jobs. This guy does not take in to account what’s going on in the real estate sector as a whole. As I’ve said many times before, most of the big money and prosperity has been fueled by the boom. No, we aren’t seeing the kind of mass job layoffs that make the news, but here’s what we are seeing. Tilte companies scaling back hours and reducing salaries. Realtors who have dozens of listings, but haven’t made a commission in 8 months. A lot of these had personal assistants who they paid in cash- see ya! We’re seeing mortgage brokerages close shop (2 within 4 blocks of me in the last 3 months). In the loan business it used to be 10 loans for every agent, now it’s 10 agents for every loan. In the construction industry, the work force was working 6 to 7 days a week. Now, it’s no longer full weeks or even full days for these guys, and with all the builders wrapping up the stuff they were working on, these guys will be dropping like flies. Many folks in the RE industry hired house-keepers, car detailers, window washers, gardeners,….stuff they used to do on their own before the boom started. Well, guess what? I’ve been hearing a lot lately that realtors, loan officers, contractors and the like going back to cleaning their own house, wasing their own car and windows, and mowing their own lawn. You kinda start to see how this whole thing works?
Stop spinnin’ your crap Mr. Realtor
What, pray tell, is wrong with cleaning your own house, washing your own windows, and doing your own yardwork? It’s how my family has always done things, and it sure didn’t kill us.
Nothing is wrong with doing for yourself at all. He was just pointing out that the people towards the end of the food chain who were supporting themselves and dependents doing these jobs for others will soon be without their work and paycheck. Sure the realtors and others who were rolling in dough and had such valuable time can cut back and do it themselves again, but what about “the help”?
This happened during the great depression. The way the upper middle class coped was by laying off “the help.” In the book “The hungry years” one example was given in that these people had to learn to survive on their own cooking.
Those who previously earned their wages as “the help” were in dire straits.
The layoffs are coming. Realtors who climbed to the top of the pay scale had better be able to live on a 60%+ drop in wages. Mortgage brokers, apraisers, will all see a requirement for more work for less pay.
A rising tide lifts all boats.
For some reason the water is receeding very quickly…
Neil
It might very well work out the other way i.e. a hell of a lot of cheap labor will be available. We had the remains of a plantation in southern Alabama (really not much more than a farm by that time) at the time of the great depression and my grandmother talks about the number of people that popped up out of the blue from “Up North” ready to work for food and lodgings. She said her grandfather remarked “haven’t had that much help around here since 1865″. Till this day I hear the story of “we were poor and didn’t have any money but we had food, clothes, and our land and that was more than most had”.
‘ In the construction industry, the work force was working 6 to 7 days a week. Now, it’s no longer full weeks or even full days for these guys, and with all the builders wrapping up the stuff they were working on, these guys will be dropping like flies. Many folks in the RE industry hired house-keepers, car detailers, window washers, gardeners,….stuff they used to do on their own before the boom started.”
You “nnvmtgbrkr ” are a ‘Steely Eyed’ observer.
Those heady days of yester-year are toast.
nnvmtgbrkr
Really appreciate your well informed observations on the Reno market. I recently visited a subdivision in the Somersett area and was told that they were going to finish their buildout with another 100 homes, do you think that was bulls*&t? I saw so much continued building up there, WTF. BTW what is your take on the condo craze downtown, are they selling? Thanks.
I don’t know if they’ll make it to 100, but like we’ve pointed out so many times before on this blog, in a project like Somersett they’ll continue to build until profit margins disappear. They still have some price cutting to go before that happens. I do believe Somersett will be one of several that’ll lead the way down. I haven’t driven through that project in a while, but I remember about a year ago seeing every third home there owned but vacant. Spec heaven indeed.
“Coming out of a record construction year and facing a serious shortage of skilled construction tradespeople, the Southern Arizona Home Builders Association decided to do something about the problem.”
Construction trades get a boost
What happens to these workers when there’s no more construction jobs?
Ask the ones that lived through the early 90’s, they’ll tell you.
Here’s one thing that they could do:
http://www.tucsonweekly.com/gbase/currents/Content?oid=oid:78269
There’s always:
Call centers in Tucson and Phoenix are shrugging off the industry’s image as low-paying, high-turnover, no-benefits workplaces….
Call centers: Pay rises, boosting local economy
Thank you for calling WorthlessServiceCorp.com. What’s your complaint today?
They’ll be deadbeat loan harassers!
Wouldn’t that be brutal? Losing your job and losing you house. And then getting a job calling other people to tell them that they had bette pay up - or lose their house!
It’s just a ploy, to get young people interested in buying real estate. Like giving students credit cards, get them hooked early.
OT- Just saw this article on Bloomberg and thought that it reeked of desperation. I just have a hard time believing that immigrants are going to prop up the housing market. Just like the average Joes, they too will eventually catch on to the fact that prices are way disconnected from incomes. But, I guess Wall St. and the Fed will try everything they can to keep this juggernaut from falling. What happens to all the immigrants that are currently employed in construction? To think they will be able to quickly find comparable wages in other occupations is just absurd. As a natural born cynic these Goldilocks spin stories are driving me up the wall!
http://tinyurl.com/poyen
Agreed, legal immigrants are facing the same financial pressures that people born here are, most are not getting paid much more money then they were a couple of years ago. While on the illegal side, as far as I know it was only the construction workers who were getting any halfway decent wages and with the building boom winding down they will lose that.
From the article:
She and her Salvadoran-born husband this year bought a $390,000, three-bedroom house in Bowie, Maryland.
She and her husband have been here for 13 years — yes they are immigrants, but they are not ‘new’ immigrants. There’s a serious lag time between arriving here and being able to afford a house.
And speaking of ‘affording’ a house: this couple didn’t “Buy” a house. The world needs to stop using the word “Buy” when they mean “The bank bought this house and they’re allowing us to live here while we spend the next 30 years paying them back — hopefully our rates won’t adjust too badly”.
The Bloomberg article should be titled “Immigrants may represent another group of people to lend money to”. (With the subtitle: “As long as we don’t tighten up our lending standards any time soon”).
yes and notice the jobs mentioned that would be buying those $390K homes. Hairdresser, Grocery delivery, caretaker. If I’m stretched as a high tech worker making median income how can these immigrant buy without suicide loans ?
What irks me is how this reporter was not willing to ask them what kind of loan product they have to support these distorted numbers between income and Loan. The reporter is either totally clueless, or he is doing the RE industry a real big favor. If I was the editor I would have told him either to “complete” his assignment or forget about it.
Somewhat OT — I don’t know if anyone else has posted this from yesterday’s Onion, but here it is:
Home Sales Dropping
September 20, 2006 | Issue 42•38
For the third straight month, sales on preexisting homes dropped, leading realtors to call it a “buyer’s market.” Here are some strategies sellers are using to entice buyers:
Dropping price by 50 bucks
Carrying around wad of money; acting like owning this house got them that money
Pointing out dishwasher several times
Explaining to potential buyers how fulfilling it is to make mortgage payment on time
Telling long, touching story about how grandmother needs $312,500 for kidney operation
Letting third blouse button go
Drowning out sound of noisy furnace with soulful vocals of Michael McDonald
Reassuring buyers that people purchase things they can’t afford all the time
someone posted this yesterday. Hilarious…
That’s the closest I’ve seen satire get to reality in a long time!
Life IS becoming The Onion!
So true. When the people who bought my mother’s house tried to sell it last year, they dropped the price all of 2% over a 6 month listing. I wonder how the RE agent deals with that kind of seller when he nags her for why the house isn’t moving. Of course, they’re glad to have the listing at any sales price because its Long Island, a very busy market, and they like to do open houses to get prospective buyers and show them other houses.
‘Drowning out sound of noisy furnace with soulful vocals of Michael McDonald’
Should it not be ‘Michael Bolton?’
Irish eyes are smiling…
From this week’s “Time” on the Irish economic boom…
Av. income in Ireland-$41,000.00
Av. house price in 1993…..$83,000.00
Av. house price in 2006…..$471,000.00
Pop goes the Bubble!!!!!!!!!
Ya Ireland is water locked!
Fewer people live in Ireland today than 200 years ago. So why isn’t housing cheaper now?
Any AZ peeps catch the KJZZ (local NPR) “Here And Now” show about AZ real estate yesterday?
http://kjzz.org/news/arizona/archives/200609/realestate
I must be living in a parallel universe because these Chamber of Commerce-types were doing the Happy Dance about AZ job and RE market prospects. I kept hoping that one of “us” would call in but didn’t hear any voices of sanity. [You can listen to the recorded show at the above link--sorry, don't know how to make clicky]
BTW: on the comments forum from the above KJZZ show, some ditz from OC, CA wanted to know if it’s better to buy a new SF or a re-sale. [And I thought the "greater fools" had become extinct]
Oh…I guess I DO know how to make a clicky. Kewl….
Clicky. I like that. Most people call them “links”. “Clicky” is almost too cute. Makes me smile, thanks.
I might have to draw a robot for that. I already have a Clickinator
MjM
“But those earnest money payments for homes that were never completed are classified as unsecured non-priority claims.”
I thought that earnest money is supposed to go into an escrow account…or is that only in California? How did the developer (and creditors) get access to it?
More denial from Tucson:
http://www.azstarnet.com/allheadlines/147602
““A fundamental shift is occurring in the type of housing offered in Las Vegas, a real estate executive said.”
I love quotes like this. Yes, it’s really really rocket science! Another fundamental shift might have something to do with people figuring out that the price of something with a basically infinite supply cannot rise rapidly over the long term. Several real estate authors have pointed out that land in places like Las Vegas and Orlando is essentially unlimited in supply and I suspect Phoenix is similar. Now if people would only figure out that their $10/hour job in those places barely pays the air conditining bill…
a hell of a lot of cheap labor will be available
Who will be competing with the existing source of cheap labor, the illegals. Who will… well who knows.