“The Market Is On Life Support” In Florida
The Palm Beach Post reports from Florida. “The faster they rise, the harder they fall. That old saw aptly applies to new-home prices, and so it is that Palm Beach County and the Treasure Coast are now leading the retreat from a boom that saw sales skyrocket and prices soar for five consecutive record-setting years.”
“Local builders also admit having a hard time, even though many are still selling hundreds and even thousands of new homes a year. ‘Sales are very slow. The residential real estate market is on life support,’ said Bobby Julien, CEO of Kolter Communities in West Palm Beach.”
“‘Depending on location and product, investors have made up as much as 90 percent of a particular market during the past 24 months,’ said Clemmer Mayhew, a Realtor in Palm Beach County.”
“Investors, who drove the boom’s unprecedented success, also provided the seeds of its decline. ‘Because of investors, and the greed of builders who sold to investors, we have a huge oversupply,’ said Pete Hegener, the developer of massive St. Lucie West and Tradition, both in Port St. Lucie.”
“Kolter Communities’ Julien agreed. ‘We had a whole bunch of builders overbuilding,’ he said.”
“‘I don’t believe any of us were prepared,’ said Kevin Lawler, managing partner of N-K Ventures in West Palm Beach. A lot of speculators got caught holding the bag, or, in this case, the unsold house, for which they most likely paid a record price. About half of the 991 vacant finished new homes in Palm Beach County developments in the third quarter of this year cost more than $500,000.”
“‘Many homes are coming back to builders as contracts are canceled,’ said Brad Hunter Metrostudy. ‘We have firsthand knowledge of hundreds of units in the Treasure Coast, among different builders.’”
“A local real estate lawyer agrees. ‘I have been receiving a lot of calls from buyers who want to default and walk away, and wonder if they can get their deposits back,’ said John Pankauski in West Palm Beach.”
“In Palm Beach County, the supply of vacant finished new homes has more than quadrupled in a year, according to Metrostudy, to 991 in the third quarter from 226 in the same quarter a year ago. In St. Lucie County, the number has nearly tripled, and in slow-growth Martin County, the number of vacant finished new homes has nearly doubled in a year.”
“After soaring to $400,000 in September 2005 during an unprecedented five-year real estate boom, the median price of an existing home in Palm Beach County plunged to $365,500 last month, a 9 percent year-over-year drop. It tied with the Treasure Coast for the third-largest drop in the state.”
The News Press. “‘We were No. 1 going up, and we are No. 1 going down,’ said Naples-based real estate broker Ross McIntosh. ‘A lot of buildings are going up, but I don’t see slabs. The handwriting is more than written on the wall; it’s carved on the wall. If you are in business in Southwest Florida, you know what’s going on.’”
“We know people are coming in, but we must also realize that people are going out. McIntosh’s analysis of drivers’ license data suggests that for every two or three people that move into the state, another one leaves, and each of those leaves a home.”
“McIntosh is skeptical of what he calls New Urbanism projects, suggesting that investors, not users, are buying residential condos in mixed-use developments such as the Coconut Point mall. ‘People would prefer to live in Rapallo than over a shoe store,’ he quipped.”
“McIntosh says there are only two problems with this real estate market: One is price and the other is supply.”
“Developers in unincorporated Lee County, Bonita Springs and Fort Myers Beach pulled 458 permits for single-family houses in September, a drop of 61 percent from the previous year and 22 percent from August. ‘Obviously if that is down so drastically, it’s going to affect the employees,’ said Michael Reitmann, of the Lee Building Industry Association.”
“In the Tampa Bay area, employment in the construction industry has shed more than 2,000 jobs since May, from 87,000 to 84,700. In a good month, Alpine Plumbing of Odessa does about 100 jobs, manager Kyle McCullough said. By September, that fell by half.”
“‘In December, it’ll probably be even less,’ he said. ‘In 2007, it could be even worse. Our guys tell us it’s a ghost town out there in the subdivisions.’”
The Tallahassee Democrat. “The Board of Governors of the Mortgage Bankers Association of Tallahassee issued a consumer alert this week to warn home buyers not to fall for the offers of Option Adjustable Rate Mortgages, or Option ARMs. ‘I’m refinancing a customer right now who opened an Option ARM a year and a half ago,’ said Pat Gaver, incoming president of the local Mortgage Bankers Association.”
“‘This customer chose the minimum payment option. Her loan balance increased $11,000 in the first year. She opted to pay a 3 percent pre-payment penalty of her total loan balance, which came out to $8,000, just to get out of the loan,’ Gaver said. ‘It could have been much worse for her because most prepayment penalties are as much as 6 percent.’”
The Orlando Sentinel. “Rhonda Morgan has pulled out all the stops for her recent open houses: big signs, balloons and people in costumes out by the street waving to passers-by.”
“Beth Goldstein got into real estate five years ago. She said of the shift to the Internet. ‘It’s a big source of my business, buyers from out of state.’ Unfortunately, Goldstein said, ‘I haven’t had a buyer off the Internet in about three months.’”
“Goldstein recently organized two open houses on the same day for the same house in Oviedo, one for potential buyers and the other for brokers, with a prize drawing worth $300. ‘We’re getting a little desperate,’ she said, because the number of listings has spiked and sales have tumbled from the record heights of a year ago.”
‘Punta Gorda is among several towns where community hubris and billions in federal aid have turned natural disasters into massive urban renewal projects. Disaster experts say these communities suffer from storm amnesia. Residents either forget the devastation or wrongly think they won’t get hit again. ‘It’s been an ugly tradition in this country,’ said Joel Hirschhorn, director of Natural Resource Policy Studies at the National Governors Association. ‘You would think that people would know better. It’s like they have a death wish.’
‘ After years of runaway growth, enrollment in Florida public schools has shifted into reverse, catching state officials off guard and forcing local districts to scramble to cover budget shortfalls. ‘It is historic,’ state Education Commissioner John Winn said.’
School enrollments on Maine coast similarly in decline. Retirees bid up house prices, young families can’t live here. I’m leaving today to drive to Treasure Coast of FL, see for myself how low the rents on finished, vacant homes may be.
Please keep us updated.
‘It’s been an ugly tradition in this country,’ said Joel Hirschhorn, director of Natural Resource Policy Studies at the National Governors Association. ‘You would think that people would know better. It’s like they have a death wish.’
It’s not that the people don’t know better so much as the Federal Gov’t refuses to stop paying for it with OUR money. As soon as the first tree falls, the Governors are on the phone to the White House whoring for the feds to print up some federal disaster relief money. The misguided practice of rebuilding in areas so prone to total loss is what needs to stop, and no politician has the balls to do it.
AMEN, ric. We see it here in Florida all the time. Just a couple of years ago, we had FOUR hurricanes hit the state. And what happens? Massive building along the coast in just two short years.
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And the White House has no choice to respond with buckets and buckets of taxpayer money or else they’ll get “George Bush doesn’t care about black people.”
Are you claiming that Bush does care about black people? What was Dubya doing while New Orleans was drowning?
Like Bush doesn’t know that blacks don’t vote for him anyway.
“Like Bush doesn’t know that blacks don’t vote for him anyway. ”
Like Dems don’t know that blacks will vote for them anyways.
Their votes are already counted: that’s the problem
Gekko posts “George Bush doesn’t care about black people.”
We agree! Good post Gekko.
If blacks would quit crying about everything maybe they would have some credibility. Attack it all you want. The truth is painful.
I wonder how long you would be crying if you were making 55 cents on every dollar the next “boy” makes.
(The color of wealth). Oh and it went up about 3 cents since the forties…..
55 is too high. The comparative value of the worker can be imputed by looking at the similar worker in the control group: In Africa.
What are you talking about?
Gekko, what happened? Total disconnect….sudden loss of brain matter? I did not know that brown people are building and owning all this beautiful coastal property we see coming up in record time, wow they are really moving up in the world.
“…and no politician has the balls to do it.”
Risk losing a big chunk of the electoral college? No friggin way. That’s why I argue insurance companies are doing themselves in by gouging FL property owners. Pretty soon Floridians and other Southern coastal inhabitants will demand cheaper property insurance and gov’ts will either bend in their favor or be booted out.
posted “The Market Is On Life Support” In Florida”
Not to worry. 40 million dollar in new ad’s will save the day!
What will the day laborers do now?
http://www.news-press.com/apps/pbcs.dll/article?AID=/20061105/NEWS0102/61105001/1075
“‘Depending on location and product, investors have made up as much as 90 percent of a particular market during the past 24 months,’ said Clemmer Mayhew, a Realtor in Palm Beach County.”
Ninety pct is an incredible number for any market. Wow! Does South FL equal speculator heaven or speculator hell?
yeah….there are soooo many condo towers that are almost empty. There are so many houses that were built in the outer suburbs of miami that are sitting empty. The worst part about this whole matter is that they are still breaking ground and building more condos/townhouses/SFHs.
One more time: build baby, build.
In a few years, there are going to be some spectacular opportunities to acquire investment properties that cash flow positive from day one for those with the ability to meet extremely stringent lending requirements.
this might help you find an entry point
http://www.files.bz/files/11251/RealEstateValuationMethods.xls
“The residential real estate market is on life support,’ said Bobby Julien, CEO of Kolter Communities in West Palm Beach.”
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“In the Tampa Bay area, employment in the construction industry has shed more than 2,000 jobs since May, from 87,000 to 84,700. In a good month, Alpine Plumbing of Odessa does about 100 jobs, manager Kyle McCullough said. By September, that fell by half.”
“‘In December, it’ll probably be even less,’ he said. ‘In 2007, it could be even worse. Our guys tell us it’s a ghost town out there in the subdivisions.’”
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After months and months of denial that there is a bubble in the housing market, it is crystal clear that it has now burst. “Ghost town” is a term that we are going to hear over and over. The build-up of inventory of vacant houses will be stunning over the next year or so. Contracts being cancelled right and left. Some builders still putting up new spec houses. Condo inventory choking the developers to the point that they are auctioning off their inventory.
The stage is now set for serious price drops. If prices can drop in some areas 5-10% in one month as compared to same month a year ago, it won’t be long until the full drop from peak prices will be 20% and more, heading much higher. Will national prices drop 10% by year end? Could be.
Meanwhile, employment numbers are dropping and will drop substantially more. The economy is headed into a recession if it isn’t already there. All the effort to put lipstick on the economy pig by the administration to preserve its power in anticipation of the election will go away and the startingly dismal reality will emerge.
Fasten your seatbelts.
North Tampa: Nobody is talking about real estate here.
Layoff of 20 at my work place this week, down from the original rumor of 160. A lot more than the 20 were offered
other downgraded positions within the organization, they did not tell us that number.
O.T. side note: One of the reclassified workers came to me a 2 months ago and handed me a portion of her workload. She said there would be no extra compensation for the added duties and I should not balk at it as there was a rumor of lay offs. In hindsight maybe she should have been the one to balk at parceling out her all workload.
Jannifl, What type of company are you working for?
Health Care
Met Life?
Anyone care to comment on what is going to happen when the whole state of California is down 30%? (not saying it will be limited to 30%) Housing doesn’t exist in a vacuum. Contrary to what we see and hear, housing affects everything. Was there any reason two years ago to steer people into arms, other than to shake a few more dollars out of their pockets, so they could spend it and keep this joke of a “good economy” alive a little longer? I agree we are in a recession. The government skews the numbers and should not be believed. Fortunately for us, we have Ben Jones’ Blog. Excellent job Ben and kudos to you. Unfortunately, the average Joe out there cannot trust his government, the media, the guy trying to push him into buying a house-to make a buck off of him, or himself for that matter. I think the anger directed at the so-called sheepies is misdirected and should be centered on our government and business, where it
rightfully belongs. Are not all ponzi schemes predicated on greed? This should not be the function of our government. I still believe this is a scam perpetrated on Americans’ to defer, dare I say, deflation. Shouldn’t anyone associated with housing be viewed with skepticism, (since they profit from the buying and selling of it) unless they prove otherwise? Since things are so much worse than reported, why believe anything they have to say about how this plays out? This housing debacle is the shot heard round the world, or it will be, when all is said and done. Do you really think people would spend money, if told the truth about the value of their house? I am amazed that not even 1 billionaire loves American families enough to spend 40 million dollar$ to tell them not to buy a house now or in the foreseeable future. I would want to warn them. Can you imagine the consequences? At this time in history, that would be tantamount to yelling fire in a movie theatre, wouldn’t it? I appreciate everyone that posts here. I believe we need to be forward much more in our thinking. Remember, America has never seen the likes of this beast and all the corruption that accompanies it. They say we have never had a depression without a precipitating factor. The often denied housing bubble, is that precipitating factor that will bring down the credit bubble in America. We should be asking what day is the day that Americans realize there is a tsunami at their financial doorstep and STOP spending? When they realize it, it will be too late. A couple of old sayings come to mind. Save for a rainy day. Newsflash, it is either raining now or will soon be raining, all over America. Another one to remember, HOME is where the heart is. These are just HOUSES. SELL YOUR HOUSES WHILE YOU CAN! It is better to get the money out of your house than to watch it disappear before your very eyes, like it is doing now. You CAN always buy another house. Why not buy one when it costs le$$ money? Even on this blog, the outcome is being underestimated. When psychology changes and people realize what is happening, it will be too late. Can you say avalanche of selling pressure? House prices were soaring on the way up and will be screaming on the way down. The government knows this and is doing everything within their power to stop the truth from coming out. I believe we are probably already in a recession and on the precipice of a depression. As long as I am going out on a limb, I believe history will prove the word great was used too soon in 1929. Batten down the hatches America. If your government cared about your financial well being, they would be sounding the alarm. You don’t want to be left holding the proverbial bag or in this case house.
You are correct in your summary.I sold out 05 and moved out of corrupt San Diego and moved out of state taking my bubble money and buying a rural 5 acre home for 1/3 less.
As a retired mortgage broker I saw all of the old standard loan guidelines removed. We now have the results. All this anger etc and useless chatter against the RE agents, flippers, are really misguided, second thoughts. All this energy wasted and blaming them for this “downfall” is really boring. They were simple the trash on the garbage truck driven by the driver[lender].The federal reserve with its banks won!
They created printable money and loaned it out with little new guidelines and they were off to the races with no down, little background checks in place, and Greenspan saying, “adjustables were a great way to buy a house.” Why not gamble. Lenders set the bait. Some made money, many more lost. The lenders knew in “advance” what was going to happen but with printed money; be honest if you had their printing press in your house, 95% would have it going 24/7.
The real anger, frustration should in my humble opinion, be the banks, the garbage that caused the next depression which history books will record. We can only hope a new generation will learn and not be fooled.
All I can say to you is “paragraphs”. The human mind needs breaks to be able to discern what is written. Your post is unreadable because it’s one big lump of letters.
i’m convinced, with comments like the above, that ben’s blog has been hijacked by all kinds of whackos … oh well, just in case they’re even partially right, i’ll grab some extra cans of tuna and maybe even some spam next time they’re on sale.
>investors have made up as much as 90 percent of a particular market during the past 24 months
today’s double-whammy: no more new speculators to buy the new construction supply coming to market and the old speculators are trying to dump their old flips in a mass exodus. all of that artifical demand has morphed itself into a real supply problem. and prices will morph from high to low - basic economic principles in action.
Geez, and how many times have we heard, “the market is returning to normal now that the speculators are gone,” line?
90% - too funny.
“…‘We’re getting a little desperate,’ she said, because the number of listings has spiked and sales have tumbled from the record heights of a year ago.”
What do expect? That’s what happens when you fully exploit your customer base like there is no tomorrow and wring it dry of every single penny that it can possibly deliver now and in the near future. Well guess what? Today is tomorrow and customers are either broke or priced out and can’t buy.
i hope she put away some money over the last few years. it’s time to tighten up the belt for 7 lean years. biblical justice.
If the market is on “life support” today, I will not be buying in Florida until the market is rotting in a bog.
South Florida looks like one big giant housing wreck with stupefied Realtors mulling around people’s homes wearing incredulous looks on their faces wondering out loud wtf just happened. Ironically, however, these same Realtors were responsible for torpedoing FL’s real estate market. They were the ones leading the charge. I have read about ‘market makers’ but these guys acted more like ‘market destoyers.’ The incredulity makes me so friggin mad!!!!
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Anyone think the recent NAR propaganda ad campaign will help the patient get off life support?
THe blowback from this fiasco will hasten the demise of the REIC.
No. It is a stupid misguided attempt to unsink the sinking Titanic. It will only serve to give false optimism to the realtwhores relative to transaction volume, and I firmly believe that that is all it is intended to do - placate the NAR membership, at least for a bit. It is kool-aid in print.
Yes, someone yesterday suggested the whole thing was a feel-good service to NAR members, and that does seem to be its only possible benefit to NAR. Will scare any would-be buyer who might not otherwise have noticed what’s going on.
The latest REIC lie: “Nobody saw this coming.” So I randomly picked a post from this blog. This one is #1762 so I went with #176 and what do I find from Feb?:
‘Can’t Get Egregious Prices Anymore’ In S Florida
Seems somebody saw this coming. Anyway enough about Ben and his great blog and all the honor he deserves. Let’s talk about me
or at least one of my favorite subjects; NURB. From the article: “McIntosh is skeptical of what he calls New Urbanism projects, suggesting that investors, not users, are buying residential condos in mixed-use developments such as the Coconut Point mall. ‘People would prefer to live in Rapallo than over a shoe store,’ he quipped.”
Exactly as I predicted. NURBs are like condos, people only settle for them because we refuse to accommodate their stated preference for a typical SFR on a medium sized lot in a residential neighborhood.
Non-uniform rational B splines? Here? On a housing blog?
whoda thunkit.
I was using nurbs to surface model composite aircraft in the early 80s. I’d extrapolate midpoints of the edges for each panel and apply anisotropic fineite elements. Funny thing is I read your clever comment this morning after getting back from Disney’s California Adventure. While in line for Soarin’ I was trying to explain to my teens how I used degenerate conic sections to loft the fuselage of one of the planes shown on the wall.
Nowadays and/or in this context NURBs refers New Urbanists as my usual descriptions are considered too inflammartory.
Gloomy newspaper articles from Palm Beach, Tampa,Orlando and Tallahassee all at once. Nope. No bubble here! Move along, folks… move along, now….
So, all this time, it wasn’t 1000 people per day are moving in, it was 1000 houses a day are bought by investors who wanted to sell them for 100k profit in a year to other “investors”. Gian pyramid scheme with borrowed money.
Miami and Ft Lauderdale made it to top 5 foreclosure markets on CNN Money.
I always thought the investors were more than 40% to get that 39% overall increase in prices in Florida in 2005 .Arizona got alot of that investment driven buying between late 2004 -2005 also to the point of frenzy . I remember reading a article in 2005 that people were camping out in sleeping bags to buy into a condo conversion project that was overpriced by what I could see . Now you couldn’t sell those condos without a loss and how about all the ghost town new home tracts .
Some people might not like it when I talk about the good old days in lending ,but lenders would put a limit on how many investors they would loan to in one tract because lenders knew it wouldn’t be a stable situation if a bunch of investors bought up the bulk /high % of a tract ,but it was alowed in this mania .
Feed those big Alligators people…Feed them because their hungry and greedy TOO !
Ghost town indeed. I spent a good part of my time over the past three years cruising new subdivisions and inspecting single-family homes. Historically, I could barely get down the streets because of all the work trucks. I had at least one flat tire every week from nails dropped by trucks.
I haven’t had a flat tire in six months.
No doubt. It’s funny you mentioned that. My commute takes me up the Gulf Beaches of Pinellas County, FL (Tampa Bay area)… the guys at Sears are getting to know me well as I’ve taken my car in 3x to have them patch a flat from a nail.
I don’t even stress anymore. I have “Fix-a-flat” and a portable battery powered air compressor. Bubble-sitting tools for the professional bubble-sitter.
Alligators won’t eat investors, out of professional courtesy.
Investors are the alligators and they’ve eaten Florida alive. I hope as many as possible have a bad case of indigestion. The good thing about all of this is that hopefully Florida will fall father faster, so we can get back to normal here. And then plow under the ghost towns. Wonder what the tax sales will be like?
That is a darn good question. They gotta shift that burden somewhere.
“‘This customer chose the minimum payment option.”
What could possibly go wrong ?
“Her loan balance increased $11,000 in the first year.” “pre-payment penalty of her total loan balance, which came out to $8,000, just to get out of the loan,’”
Wow, an $19,000 loss the 1st year of ownership for not having a realistic loan ! Way to go creative financing ! Will the NAR feature this success story in their ad campaign ?
“Beth Goldstein got into real estate five years ago. She said of the shift to the Internet. ‘It’s a big source of my business, buyers from out of state.’ Unfortunately, Goldstein said, ‘I haven’t had a buyer off the Internet in about three months.’”
Maybe that is because Florida has priced itslef out of most of its niches in the global economy. While people will still visit, it no longer makes sense:
1. For a midwesterner to retire to Florida. They cannot afford to anymore.
2. Relocate a business to Florida. People do remember how is was driving state growth, don’t they? The opposite is happening.
3. Second home market. Its too pricey.
4. Not to mention what fraction of the Florida job market is currently into building homes.
The question isn’t if this will hurt Florida, but for how long? Three years? Five?
Neil
Very true Neil. I am a native of Florida and reside in Vero Beach. It is going to take several years before all this plays out. A realtor that lives in my neighborhood told me yesterday that the market here is at “critical mass.” She has some buyers that she is looking for but they cannot afford the taxes and insurance. Also, the real estate section of our local paper announced an “Auction Extravaganza” with over 100 properties being auctioned later this month. That is unheard of here.
I have seen quite a bit of reduction in prices though; specifically, my neighbor listed his house in Jan 06 for 589k and is now at 469k and has had very few lookers. He is going to drop it again in two weeks if no takers before than. It is a nice house, but its still way over priced in my opinion. I am also starting to see a pretty big price drop in 5 acre tracts in west Vero, which is not surprising. They went from 85k to over 300k in three years. More people started developing 5 acre tracts and now there is an over supply; and, people are not building on the ones that were purchased during all this craziness. Again, as you point out, taxes and insurance.
Now it’s time for the assembly to go supercritical.
What scum put someone on a loan like that .Did this borrower think the low loan payments were for real ?
Well , its going to backfire on the lenders because you have to have equity in order to pay deferred interest . I really believe the lenders thought appreciation would cover it . In this case the borrower had enough equity to get out of the deal but how many upside down borrowers don’t . Foreclosures a coming .
Not until this historic oversupply dwindles will prices start to go up, McCabe said.
But he has some very good news , too: “Once we get to that point, we will see prices appreciate - and we will never see prices drop again,” he predicted.
Wow. Somebody please save this quote, I have a feeling we’ll be posting it on this blog many times
Interesting proposition. Let’s imagine that “this historic oversupply” takes many, many years to dwindle. Then this episode might be as memorable as 1930’s Depression, and may live in the memories of specuvestors’ children for a long time. Of course “never” is a longer time than that, but I can’t say this blog will see renewed deflation. Ben is not a baby.
I have a sort of wild prediction which I have about 50-70% conviction on.
This downturn will bankrupt McCabe and his fund too. He’s too mouthy and dying to get in, obviously.
During the summer, there was some speculation even on this blog, that _maybe_ the winter snowbirds would provide a temporary lift to the market.
Well? It’s November now. Any lift taking place? Sounds like not. This slump will just keep plowing on, especially as vacationers read articles like these and put off any thought about buying a second falling knife — er, home.
Snowbirds need “Cheap” for the deal to work. Now that they’ve been priced out its just as easy to buy a used RV and tour the warmer country during the winter. Of course all those stuck flippers could furnish their condos and rent them out a few months of the year. Yeah, that should work !
“McIntosh’s analysis of drivers’ license data suggests that for every two or three people that move into the state, another one leaves, and each of those leaves a home.”
That is telling and “feels” like a much higher emigration rate than we’ve had in the past. I believe, though, that what increased school enrollment errors the most was the failure of anyone on the numbers side to ask about or consider the volume of housing that was bought for flipping. For that matter, many, many real estate agents were right in there with the gringos, buying up flip after flip, often because they had advance knowledge of pre-construction buying opportunities. A friend of mine wanted me to consider a lot in a new development on the northwest side of Orlando that looked nice, from the artist’s rendering. But when he told me that an agent friend was buying six or eight of the lots, using friends and family members to get around the developer’s anti-speculator clauses, I turned off to even seeing the place.
Chip, you mean to tell me a Realtor, with their high ethical standards, would do such a thing? I’m shocked, truly shocked.
“Local builders also admit having a hard time, even though many are still selling hundreds and even thousands of new homes a year. ‘Sales are very slow. The residential real estate market is on life support,’ said Bobby Julien, CEO of Kolter Communities in West Palm Beach.”
The market is on life support, down there in Terry Shiavo country? I wonder if the governor will intervene in the market?
http://dir.salon.com/story/opinion/feature/2005/03/31/reynolds/index.html
From the Orlando link, I love the photo of the very-non-bulemic sign-twirler agent dressed up in a cow outfit - “Eat ‘Mo House!”
From today’s Tampa Tribune: “Suspicious property deals on the rise.” A tip of the iceberg regarding the massive real estate fraud in this area. http://www.tbo.com/news/metro/MGBUUK5S4UE.html?imw=Y
Quote from article: “…The problem is that it takes a village to commit mortgage fraud, and it’s very difficult to prove what law all those people broke.”
So true.
lenders own this problem, not the government. the remedy is called lending standards and risk management. oh but wait, i forgot this is florida … the same place where terrorists can go to flight school and skip the takeoff and landing class. oh, ok then. yes, let’s ask the govenrment to fix it all.
I was surprised Ben didn’t pick this story up in the synopsis.
This was FRONT PAGE news in the Sunday Trib.
A few telling facts: Florida is Number One in the fraud business, for 2 years running. Another tid-bit, the fraud is rampant and has effected all areas of the State.
Well, I am surprised !
Had the most amazing conversation with a realtor today ( visited a friend and the house next door had an open house and I decided to see what the “jewel’s asking price was. This is in Miami west of I95 n a so so area. The homes went from the low 200dreds in 2004 to $325K -365 last year. Asking price now $300K and so not worth it. Obviously a family home ( 3 bedrooms, many kids in the complex), insurance around $15 per $1000 ( acc to realtor), maintance$300 p/m, taxes 2.2% on $300K - $25K homestead exemption. I told the realtor who had only 1 visitor take a look at the house ( the owners in their 2005 arrogance had not even bothered to make the house look ok, it looked dull and lived in , in the corner a bunch of blankets representing a bed?. The house was built in 1987.
Anyway the realtor told me the house was a “steal” and that prices were not going down because ” the government would not allow it” I asked him why the government “allowed” for prices to go up in the first place and he shrugged it off. Then he told me that he was working on having people transfer their Safe our Homes 3% cap to their next house and when I asked him what would happen to first time buyers he said that they will be out of the market forever..
What arrogance, I can’t wait for these realtors to fall flat on their face. In the meantime I’ll keep my $$$$ in CD and will wait for pirces to drop. Oh , the school in the district the house is offered is a C school.