“Prices Are Dropping. That’s Reality”
The Toledo Blade reports from Ohio. “Industry reports this year have indicated a slide in the national housing market and price drops in Michigan and Ohio. But the latest report paints a stark picture. Toledo ranked last out of 10 metropolitan areas in Ohio, according to the Office of Federal Housing Enterprise Oversight.”
“‘Prices are dropping. That’s reality,’ said Dan Lepkowski, a real estate agent in Toledo. ‘It’s been that way for a while and the Realtors that don’t admit that aren’t being straight.’”
“(Broker) Dan DiSalle, Jr. said stagnant home sales in the Toledo area mainly are in the move-up market, or houses $200,000 and up. ‘My experience is in the move-up price ranges there is mostly an oversupply,’ he said.”
From ABC 13. “Drive down a lot of streets in the area and you’ll see a lot of ‘For Sale’ signs and while Toledo has a glut of homes on the market, realtors say there is a silver lining. Rod Culler is a local realtor who deals with foreclosures. He says he’s never had so much business. ‘I’ve seen about a twenty percent increase,’ he said.”
The Detroit News from Michigan. “Stalled subdivisions are becoming an increasing part of the landscape across Metro Detroit amid a slumping housing market for single-family homes and condominiums, threatening increases in property values and quality of life for neighbors.”
“‘It’s probably been the worst year I’ve ever seen in my life,’ said (developer) Anthony Sorrentino. ‘It’s like the whole world completely stopped.’”
“In some half-finished subs where neighbors aren’t moving in, blight is. Vandals and thieves have smashed windows and stripped copper pipes from the abandoned Taylor Meadows condominiums across from the house where Lightfoot lives. ‘Ain’t nobody there,’ Christopher Lightfoot said.”
“Frank Slavik lives on Tiara Lane in the Monroe Meadows subdivision on an unfinished cul-de-sac, where one lot is undeveloped, one house is being auctioned and another one sold for $209,000, about $100,000 less than what Slavik’s home is worth, he said.”
“Slavik said he has had difficulty refinancing his home. ‘It’s going to kill everyone’s value on this street,’ Slavik said. ‘It drives me nuts.’”
ABC Newspapers from Minnesota. “The Port Riverwalk townhouse and condominium project on Coon Rapids Boulevard is on hold. The soft housing market at this time is the reason for Rottlund Homes pulling back from the planned 2007 start of the project, according to City Manager Matt Fulton.”
“‘The community will undoubtedly be disappointed by the failure to move forward, but I believe that everyone will appreciate the hesitation to start, given today’s very soft housing market,’ Fulton said. ‘They just can’t do it right now, given the current market conditions.’”
“According to Marc Nevinski, city community development director, the soft housing market is affecting many developers, not just Rottlund. ‘The problem is that there is a huge amount of inventory out there that is not moving,’ Nevinski said. ‘Developers are selling off projects at huge discounts and walking away altogether.’”
The Forum from North Dakota. “It’s a homebuyer’s market in Fargo-Moorhead for two reasons. There are a lot of homes for sale and 30-year fixed-term mortgage rates have dropped below 6 percent. ‘They are definitely going down with the uncertainty in the economy,’ Dave Ouradnik, owner of Executive Mortgage Corp.”
“The local housing market has been moving at a fast pace for several years in a row, said Mark Daniel, president of Coldwell Banker First Realty Encore, Fargo. The fastest home-sales market in Fargo-Moorhead occurred in 2003-2004, Daniel said.”
“‘We are not in a bad market,’ Daniel said. ‘We are in a corrective market. The market just needs a little breather and a little catch-up time.’”
“‘We are not in a bad market,’ Daniel said. ‘We are in a corrective market. The market just needs a little breather and a little catch-up time.’”
That is just too funny. “It’s just a flesh wound.”
“I’m cold, I’m cold,” Snowden said.
‘On the eighth day, the forty-year-old hobo said to Billy, “This ain’t bad. I can be comfortable anywhere.”
“You can?” said Billy.
On the ninth day, the hobo died. So it goes.’
– Slaughterhouse-Five –
Kurt Vonnegut, Jr.
I know year end is fast approaching and who knows where Zip gets these numbers, however, they are dropping big time. Though still a lot higher than mid May.
http://www.ziprealty.com/maps/index.jsp?usage=search&cKey=74rbwvlk
mid may was 799,000
6/10/06 was 836,471
6/14/06 was 840,935
6/17/06 was 846,120
6/20/06 was 850,317
6/22/06 was 855,892
6/24/06 was 860,647
6/29/06 was 866,037
7/01/06 was 858,675
7/09/06 was 870,854
7/11/06 was 882,239
7/13/06 was 886,055
7/14/06 was 890,896
7/18/06 was 895,022
7/21/06 was 900,000
7/25/06 was 905,170
7/28/06 was 910,001
8/01/06 was 903,718
8/12/06 was 915,336
8/19/06 was 920,755
8/26/06 was 925,176
8/29/06 was 951,242
9/15/06 was 955,352
12/1/06 today 925,170
I am also seeing a little dip in my local MLS… most the people whom I talk to who have been unsuccesful selling their properties for 6+ months have indicated they are taking their homes of the market and relisting in Spring…
Oh how everybody is praying for the Spring bounce…
(located in FL panhandle)
I know I’ve asked this question already, but what in Sam Hill is so special about next spring? The start of baseball season? The sound of birds chirping? Flowers blooming? Or will it be the sudden increase in for sale signs?
It’s easier to look for housing in nice weather, easier move in summer than winter, easier to move after school lets out, etc. But now way are there enough buyers to adsorb all that inventory. I had a friend in Tucson who was contemplating waiting till spring and I told her to cut the price. She took a ~$15K haircut off peak. She wouldn’t do any better next spring anyway.
I thought it was because everyone is focused on the Super Bowl?
The Superbowl is why plasma TV’s don’t have after-Christmas sales until spring.
Inventories always go up in the spring, along with sales, for the reasons stated. I too have observed a marked decrease in listings here in Loudoun county - from a peak of 4670 in the summer to now 3153 (normal rate is around 1200 or so).
Key thing is that this inventory reduction hasn’t been due to sales, it’s been due to listings expiring. This means there is indeed a huge “shadow inventory” of people who would like to sell their home, but know that it’s pointless to list it right now because of slow sales.
Last spring though, sales only increase a small amount above the previous winter - by about 5% - normally sales go up in the spring/summer about 60% above winter. This coming spring is going to be yet another shock though IMO, as sales will continue declining YoY until they finally bottom out next winter, at a really low rate. What I think will really be shocking though is how high the inventories have yet to go - in the spring I’ll bet a lot of the folks who “gave up” this year will give it “one last shot” hoping to catch a few springtime suckers, and inventories will go even higher than this past summer’s all-time highs. Things should start to get interesting in March.
Az, It’s below zero today where I live. Nobody looking for a house today.
Same story in San Diego. From 22,300 to 19,500 (approx) since the end of August. I don’t think these are all sales and no additional. My hope is there are now 19,500 deperate sellers
Great moniker~
I don’t think that rule applies so much in So Cal. The weather here is pretty nice all year round. The winter seems somewhat slower, but not like in places where it gets cold and icy.
Josh
School and job relocations tend to increase. Layoffs after holidays also increase.
People retire in the new year and other tax related matters (cap gains).
Long term property holders are in fine condition even at 2001 prices.
SoCal may have nice weather, but its still better to view a house in daylight…even here in L.A it gets dark before 5pm in december, so that rules out evening and weekday showings until the northern hemisphere tilts back towards the sun.
Also, its because ‘everyone does it’. And don’t forget to factor in the Real-TOHR spin that it will get better in the Spring. No real reason, except they say so. Gotta have hope…..
Ahhh… the spring bounce! How can we get a spring bounce when everyone and their brother dumps his house on the market at once in coordinated fashion in the ’spring’. Spring bouncers should get a drop on their competition buy beating their neighbors to the MLS. Gentelmen, I think spring has already started.
Plus there are an increasing number of leading indicators pointing towards a recession for the overall economy. Posted this on another thread yesterday, but yield curve is becoming more inverted, $ at a 14 year low to the Pound, retailers are fearing a slow holiday season, etc.
Also, the manufacturing sector contracts for first time since 2003:
http://tinyurl.com/yhxlc5
Oh yes the fabled spring bounce. I hear some people see it in a vision, others read the secret scrolls. Some say it is just a myth, a hope, a dream.
Me I think a bunch of people are going to dump their stucco crap box on the market and inventory is going to shoot through the roof. Then people will panic and whole economy will take a big dump. That just me though and am not drinking today.
But somebody on the WSJ RE board begs to differ:
(after you read this, David, I predict you will be drinking today…I know I feel like a two-martini lunch right now)
“Homeowners: do not sell unless you have to. If you keep your home off the market and wait until the summer of 2007 you will get 10% above todays comps i.e. more money for your trouble. The facts are we need to work through the excess inventory or backlog. If you have to sell, give the home curb appeal and hold the line. Never sell for less then last years comps. No exceptions. Don’t get robbed.
Jolly said a lower inventory of homes on the market indicates that sales are making a dent in the backlog. It’s just taking a little longer, he said. The statistics bear him out.
Renters can expect a 2-3% increase in rents. Landlords: it is time to condition your tenants of this event. It is a good time to raise rents as vacancies are at historial lows after a wave of condo conversions took place the past 5 years. Home Buyers this is the perfect storm as the bottom is now and a great time to buy with low interest rates and you will notice inventory is now starting to be lower. The same deals will not be available in 90-120 days when inventory is reduced another 25%…. You will have to pay more or commute more… Buying new homes from Builders offers the biggest bang for the buck however as Builders are working through inventory the incentives will dry up quickly. Do not expect Builder invcentives in the summer of 2007 they will not be required… ”
wow.
Set ‘em up Joe!
oh I forgot - the title of this post was HOLD THE LINE
“Hold the line” didn’t work for buyers on the way up, and it won’t work for sellers on the way down.
“Hold the line” only works if you can get all competittors to line up together against the buyers (otherwise known as price-fixing). It doesn’t work because although there is a huge incentive for everyone to work together, there is an even bigger incentive for each individual to be the first to break the line. It’s a variation of the prisoner’s dilemma.
Collusion is all the rage, the selfish greedy flippers know new construction and inventory is hurting them: “In Taylor, where about 13 subdivisions are in development, residents are targeting for recall elected officials who oppose a temporary construction ban.”
http://www.detnews.com/apps/pbcs.dll/article?AID=/20061201/BIZ03/612010399
I don’t mind those with second (or third or fourth) homes holding the line…let those alligators feed off of the owners each month in high carrying costs. Chomp, nibble, chomp, hmmm, maybe we should hold out until spring, chomp, nibble chomp…
Providing bad advice is an easy solution.
Don’t list now (cause I’m listing first).
No thoughts about holding cost here, eh?
I will be at Beverages & More later today when I get off work. Pick up a bottle of the blue label and ponder the spring bounce.
I have said it before and I will keep on saying it the spring is the line in the sand. The final battle to end all housing bubbles. Well at least for the central valley up to the Oregon Border it appears to be toast city. I will go to a Starbucks this weekend and speak really loud to my wife about the upcoming housing crisis.
I’m willing to bet that Spring comes early this year (as in sellers relisting big-time right after the holidays)
Right!, When they actually, really, absolutely have to sell! …and so will everyone else, and the first major wave of ARM resets, and the reported recession being reported ,and the USD under 80, and……..
http://finance.google.com/finance?q=usd
It’s called a cascade…some will jump the gun, then others will see them jumping the gun and list themselves, which will panic others who will then jump the gun themselves…you get the picture. Kind of like it was on the way up, with more and more people getting worried about being “priced out forever”. Te psycology works the same in both directions.
“In some half-finished subs where neighbors aren’t moving in, blight is. Vandals and thieves have smashed windows and stripped copper pipes from the abandoned Taylor Meadows condominiums across from the house where Lightfoot lives. ‘Ain’t nobody there,’ Christopher Lightfoot said.”
Everything said 6mo to a year ago is a’com’in home to roost. This is just the start.
There’s a house in my neighborhood that HAD a for sale sign out front. I don’t know if it’s been sold yet, but it sure has been vandalized. Broken window on the front of the house and graffiti tags on the back. Although the front window has been repaired, the tags remain.
In Realtor speak this will be described as “unique urban art work that helps your dream house blend into the neighbourhood.”
Call the County and report the blight. Maybe they will get a fine.
The vandalizing in Detroit suburbs doesn’t surprise me. I was reading an article a few months back and apparently, the infamous “Detroit skyscraper graveyard”- where countless skyscrapers from the 20’s-40’s sit empty- has been looted for years by “miners” that go in and strip them of their brass, copper wiring, and radiators.
Seeing that even now a 200 pound radiator will get you around $3 at the scrap yard, that alone tells you just how desperate some people in Detroit are- the economy is is the crapper there. If GM doesn’t survive, then that alone accounts for several million jobs nationally, and countless jobs in the Detroit area. If that were to happen, then the entire area might become one giant ghost town. Now… why on earth a house near Detroit would cost 200k is beyond me. Perhaps I simply don’t know enough about the area to make that kind of call.
you may find it hard to figure 200K for a 2500 sq ft home with large yard, no traffic and all the water you want is tough in Detroit area, were I’m on street corners here in San Jose paying people to bi*ch slap me silly trying to figure 800k for a 1000 sq ft hole, no yard and All the traffic you want.
Oh don’t get me wrong- neither choice are exactly palletable. 800k for a suburban craphole in San Jose versus 200k for a “peaceful” home outside one of the highest ranked crime producing cities in the country with a faulty rust belt economy are about on the same line.
I’d much rather pay 100k for a nice home in a low crime area in Georgia or North Carolina.
“(Broker) Dan DiSalle, Jr. said stagnant home sales in the Toledo area mainly are in the move-up market, or houses $200,000 and up. ‘My experience is in the move-up price ranges there is mostly an oversupply,’ he said.”
yeah its stagnant alright! Cause everyone priced their $100K POS for $200K+ and are now wondering why no body is bitting…
It was a ponzi scheme, and it has ended. The seller can lower the price back to the 2000 level in one move or just bleed slowly.. but wait they are already HELOC’d to the max, and who would want to bring a check to the closing. So what’s the time frame on a foreclosure, how long does it takes after missing payments that the bank gets to hold the keys…?
I’m guessing about 4-5 months of missed payments, and then a few months in les pendin, then the auction. My gut feeling is that people are already missing their payments, so right about summer 2007 would be the time to have lots to cash reserves and be ready to make offers on the REOs… I confess I’m a bottomfeeder, love making offers on REOs and thinking about next summer gives me goose bumps (provided the economy hasn’t fallen off the cliff and i have my day job) .
Stagnant at $200K and up is no surprise. I wonder if those are new spec commodity McShitboxes that are all empty air inside and no yard outside, packed into instant “communities” with an overbearing HOA.
The house configuration that makes the most profit/sq foot is the house that doesn’t sell. I’d celebrate the karma, if I wasn’t grieving for the lost arable land.
Zee, I think you got it all wrong. A very close friend of mine used to live 50 miles outside Toledo and now lives in Phoenix. She said there is no comparison of the two markets.
Toledo has been losing jobs so fast you can’t imagine. It is 60 miles from Detroit, and heavily auto based. The Jeep plant has been cutting jobs. Dana corp (MAJOR auto supplier) is in BK. House Prices have been stagnant there for at least 5 years, so houses are already priced at 2000 levels.
Just imagine the 20 biggest employers in Phoenix all shutting their doors at the same time. Imagine what that would do to the economy in your town. Now you can begin to picture why Toledo house prices are falling so fast.
All of the construction guys I know are now short of work. In months past they worked 7 days a week to keep up. It’s happening in Arizona, just without the big announced layoffs.
I was at Tucson’s big home show in early October. I heard the word “layoffs” said by someone who knows the local home construction industry inside and out. So, yes, folks, the L-word has arrived in Arizona.
I’m about to leave Maine for the season (a little late), but want to report the local analogue of Layoffs. There are No Winter Jobs here anyway, but then again, a local cleaning woman told me a sob story yesterday about how her customary order to make a couple of dozen Christmas wreaths for a local store was cancelled because the store wasn’t getting any traffic or orders.
Ben… great blog. I enjoy reading this every day.
Here in Ohio speculation (at least in the strict definition) is a very miniscule part of the market. The market has been drive (down) by job losses, plain and simple. These people in Toledo (my wife is from nearby) were not trying to make money with their houses. They were not hoping to make a killing thru appreciation or taking equity out via HELOC (with some exceptions). These are regular working folks who lost jobs in a number of industry, starting with auto. The young people have left due to a lack of jobs, and you end up with a de-population effect. Why they tried to build any new subdivision in the area at all is a mystery to me.
Here in Cincinnati, houses have appreciated about 18% over the past 5 years. That’s less than what many houses were doing in a single year out West. And Cincinnati has pretty much done better than EVERY SINGLE CITY IN OHIO. There are no people to buy in places like Toledo and Youngstown because there are no people under the age of 40 gainfully employed there.
It is no fun witnessing an economic collapse of an area. I’ve just lived thru my third. First in Ohio in the early ’80s (when I grad college, unemployment in Ohio was 12%. No college grad could get a job at all). The second was Upstate NY (Syr) in the mid 90s, and now back in Ohio over the past 5 years. Each collapse has been characterized by a mass exodus of young people in particular, and by all people in general. It is no fun to live thru, and really impacts the ability to recover when there is a skill shortage comming out of it. I have seen many, many, many cases of ex-Ohioans move back once the recovery starts.
However, there will continue to be problems in Ohio housing for years to come, even if jobs return. While few existing home owners (that I know of) took helocs on their houses, most young people buying today are putting little money down. I think it is this group of low down payment ARM buyers of the last few years that are the source of lot of future foreclosures.
Thoughts on relcoating to the Columbus area? Live in NYC now, disgusted with cost of living. Have relatives in Lima so I know what you mean about the downturns. Lima used to be a boomtown. At leats they still have the Abrams/Stryker Tank plant and the BP refinery. Going to build a huge ethanol plant.
I completely agree. Prices in the Detroit subs and Toledo market are already at 1998-2000 prices.
I know of many people that are still employed but are worried that they will be layed off in the near future because of the auto industry falling apart. They have considered moving to another state but soon realize they will not be able to sell their home quickly unless they list it for 1995 pricing or earlier. Home prices in Michigan/Ohio are generally half the cost of a home in Phoenix and built on a much bigger lot.
Ah, but let’s not forget that the folks of
Toledo Unselfishly gave us the scales…
No springs, honest weight, that’s the promise they made
So smile and be thankful next time you get weighed…
kudows to the late John Denver
Hi CincyDad,
), then it doesn’t matter where its at, and chances are its still gonna stay at $80K even if california is doing 20% appreciation/depreciation per year.
I got your point, i recently moved to PHX from Raleigh, and the difference in the market is astronomical, I call the phx market ’stupid crazy’. My comment was directed towards the areas that saw ungodly appreciations in the last 3 years. the areas in flyover country That didn’t see as great a appreciation in pricing would probably won’t see as big a fall as well. Besides, it comes down to affordability, if you can afford a $80K house flipping burgers (would be great if the house was paid off
Haven’t we been told repeatedly that this bubble was only on the east and west coasts and that it wasn’t national? NORTH DAKOTA????
What, are the baby boomers buying condos there too?
“The local housing market has been moving at a fast pace for several years in a row, said Mark Daniel, president of Coldwell Banker First Realty Encore, Fargo. The fastest home-sales market in Fargo-Moorhead occurred in 2003-2004, Daniel said.”
Tx, Those condos will double as low maintenance cryonic suspension chambers when needed. That’s why there is such demand up there.
The credit bubble is world wide. It is even affecting children who won’t be born for decades.
‘In an effort to make sure that the non-traditional mortgage loan industry is properly regulated, the South Dakota Division of Banking recently announced that it is adopting a set of guidelines to oversee the marketing of non-traditional mortgages by state-licensed mortgage lenders and brokers.’
‘They include everything from interest-only mortgages to adjustable-rate mortgages. ‘They basically allow borrowers to exchange lower payments early on for higher payments later,’ said Roger Novotny, state banking division director.’
‘According to Catherine Woody, assistant vice president at the Conference of State Bank Supervisors, non-traditional mortgage products have been around since the 1970s, but in the last few years, more than ever, these types of products are being more aggressively marketed to consumers. ‘And with the housing market cooling, the concern is that there will be more foreclosures,’ Woody said.’
‘Novotny said the growth of these types of mortgages can be attributed to the lure of easier access to housing at a lower initial cost, especially to new homeowners and those trying to move to a larger house. ‘The amount of non-traditional loans right now is phenomenal, but like they say, there is no free lunch,’ said Novotny.’
Why do people in South Dakota need interest-only loans?
And is it any surprise some lenders have been reckless with them?
Another story about foreclosures piling up. Some guy in Detroit bought a house for $1,500!!!
http://biz.yahoo.com/weekend/distressed_1.html
Detroit has lost over 1 million residents since its peak. There are tons of houses to be purchased for very cheap. At work, out here on the east coast, a co-worker told me that a relative was going to flip houses in Detroit. Sure Detroit homes look cheap and they are because THERE IS NO DEMAND for these house.
In college in 94, some friends and I bought two multiunit houses for 22k (there is no missing zero), these were huge but needed a ton of work. One house had a theater with a bar and two bathrooms on the back. We had tons of fun. We bought these houses for $2500 down on two land contracts. When we did this we had offers to take over similar houses which were being sold on land contract from neighbors. These houses were rented cash positive, but the landlords did not want to bother with them. We said no, because we did not want to bother either.
Detroit is extreme but this is what may happen when people see housing as a money losing proposition.
I was there recently and the non profit we set up for our houses is still going and the houses still need lots of work. The neighborhood has changed as some near-by projects have been torn down and a developer, (I think with HUD money) is building 300-400k houses there.
http://www.woodbridgeestates.com/index.cfm?method=OurModels
Anyone who buys these will truly lose their shirt. In the neighboring historic district nothing has broken 200k as far as I know. This house nearby is over priced at 139K.
http://detroit.craigslist.org/rfs/241297007.html
A lot happened in Detroit, including race riots and the decline of the US auto industry. But the city may be an example of what will happen in the rest of the country now that we have exported so much of our productive economy and the savings (including IRA’s) have been spent or lost and the CC’s are maxed out.
Part of this credit bubble has definitely been a response to the stagnation of wages that have accompanied our deindustrialization.
My 2 cents.
Equity locusts, after taking the “no money down” real estate courses, became property investors. They have been roaming the countryside searching out “UNDERVALUED” houses everywhere in America, and elsewhere.
If a similar house sold in Massachusetts for 420k, the 150k price was CHEAP. You know that’s what has happened in Texas, and alot of that has happened here in Florida.
Although the price wasn’t cheap, this massive buying removed available inventory from legitimate buyers, thereby creating a “housing shortage”. That got the locals into the fray, bidding up prices of the remaining homes, while builders jumped on the bandwagon because the cost of building vs. current sales prices was just to irresistable.
Yes, FARGO, Boise, Duluth, Austin, hell, Grapeland, Tx.
Anywhere a house could be purchased below 150k, they have been bought and re-priced to more appropriate levels.
It’s ticket-scalping in the housing industry.
One problem, though, the show isn’t sold out.
The scalpers are standing outside the sales office twirling signs for tickets, but I’m going to the box-office. They are offering discounts to fill the unsold seats.
Buy some popcorn and enjoy the show.
Being a native Californian and seeing that you can buy something for what seems “on the cheap” in a flyover state, after selling your 3/2 in azusa for $500k makes sense. We were in New Mexico and went through Jemez Canyon and oh so beautiful, with 5 natural hot springs not so far away and “just” $170k for a house.
The Californication continues…
Right but wait until you try to find sushi or an indie flick there.
Plus, Jemez Springs is one of the treatment centers for child-molesting Catholic priests, so the kids’d have to stay inside.
I’m from the ‘real’ Wyoming (not Jackson Hole, with all of the Hollywood types), and I can’t possibly understand moving there or either of the Dakotas. No jobs, scenery approximating that of the Moon, the possibility of snow from October through May. I just don’t get it. Don’t get me wrong, the friendliest, most down-to-earth people live in that part of the country, but the young people are all leaving and that tells you something.
A housing bubble in the northern High Plains is simply mind-boggling. I think anybody who participates in that might just qualify as the Greatest Fool.
My parents live in Sioux Falls, SD. Sioux Falls is an excellent city: Infrastructure for 500,000, population of around 100,000. The city runs like clockwork. All the modern amenities you could want. It does get busy on the weekends when the farmers come into town with their wives and families to go shopping (hence the “built-for-500,000″) but again, its a metropolis… prettymuch everything you could want is there. The twin cities are three hours away. Omaha is 4 hours away. It really isn’t that bad, if you can tolerate the weather (I grew up in Wisconsin, its nothing for me). Now living out near Rapid City? Wall Drug? Yeah, you would want to think that one through first.
Yeah, I forget that the eastern part of the Dakotas is more like the Midwest. Not such a moonscape as the other end of those states. And like I said, the people are great, but paying inflated prices for housing just makes no sense, since the economic infrastructure just isn’t there.
I grew up in Wyoming too…and there is absolutely NO way I would ever go back for anything but a vacation in the northwest corner. I agree about the lunar landscape, but I didn’t find the people to be all that friendly or open. When I used to go back to visit my folks, I was always struck by how grim everybody looked, and the beater cars everybody was driving remind me of what the Mexican fieldworkers drive here in California.
People getting murdered in a 500 person high school, gays getting beat damn near to death, meth heads haunting the bars looking for a fight, and my childhood friends looking 20 years older than me are what I remember of Wyoming.
It simply is not fit for human habitation….which makes it a pretty great place if you don’t like people.
I have a question.
If you owned a FOR SALE sign company would you be printing signs for Spring sales or printing SOLD stickers that go over FOR SALE signs?
how about a “In Foreclosure” sign.
Definitely “Motivated Seller” placards to go on top.
REDUCED would be good too.
I see lots of reduced signs here in Sacramento but they don’t see to help. How about “1999 price”?
On this island, there’s a joke that the three most common surnames are Eaton [for real], Forsale, and Waterview.
“Will sell for food”‘
You could try a local Tucson favorite: The sign that advertises a house that is for sale and/or for rent.
‘Not For Sale’ could well be the sleeper sign of the spring. The few homes not on the market could put these out, while one could just assume that all others were for sale at reduced prices.
LIBOR holding steady at current rates. No relief in sight for the ARM resets. Who cares what treasuries do - 99% of all ARMS are LIBOR based!
You should tell that to CNBC, they ejaculated on the camera this morning when the 5yr dropped. The ARMS can be re-financed!
…still mopping up the set!
Good luck trying that! 30 day LIBOR is at 5.32% and has been for 5 months now. Add a 2.50 basis point spread and POOF you have your payment.
Sorry if this post twice. I am new to the board and the post did not show.
I have a question of how the bond prices and the falling dollar will effect (if any) the housing collapse. Other than resetting ARMs and high inventory what else could help drag t housing even lower. Does the bond rates have an effect on housing rates? And what effect will the weak dollar have on the housing industry. On CNBC this morning they were discussing the refinancing of ARMS now that the bond yields are low. Could this save over leveraged individuals? Could you please educate me?
Your question is buried, it might get more response in the latest thread, nevertheless. In Calif. at least, the interest has very little to do with toxic mortgages. It’s a red herring. Most bought with IO and teaser rates. The ARMs thing was just window dressing that helped them believe they got a good mortgage. Regardless of rates, they can’t afford the mortgage without negative amortization.
I bet Monty Python’s ” just-a-flesh-wound ” knight was a Realtor in his spare time,
… selling peasant cottages as fixers,
… always chirpy & upbeat.
How about all the sub-prime loans that have a 3 to 4% spread on the index . I don’t even think alot of people understand the spreads or what will determine their adjustments ,or real effective interest rate charged .
Is it any surprise that these rates are tied to LIBOR (London rates) and not US Treasury rates?
most of the subprime i see has spreads over 4.5%, the broker was incented to up the spread for more yield spread premium up front.
“In some half-finished subs where neighbors aren’t moving in, blight is. Vandals and thieves have smashed windows and stripped copper pipes from the abandoned Taylor Meadows condominiums across from the house where Lightfoot lives. ‘Ain’t nobody there,’ Christopher Lightfoot said.”
Same thing happening here in Philadelphia (alledgedly not a bubble city, btw!). There is an area here called the “Graduate hospital area” where a bunch of speculators built hundreds of new homes in a nasty, blighted area and somehow got some people to buy a fraction of them. Problem is, many of them are still sitting their vacant. Recently, thieves have broken open the lock boxes, entered the homes, and helped themselves to lots of new appliances and such.
Bubble or not, Philly is hardcore.
Philly’s no place for wusses that’s for sure.
Gentrification around Graduate Hospital started in the late 80’s, and that was in the non-scary working class ‘hood close up to the hospital. But the rehabbing that has happened recently is pure speculation. And have you noticed that the neighborhoods designated as “Graduate Hospital Area” are no where near the hospital?
Sellers, good luck to you, try not to be too greedy, and you may get out alive:
http://philadelphia.craigslist.org/rfs/242550360.html
http://philadelphia.craigslist.org/rfs/242545767.html
http://philadelphia.craigslist.org/rfs/241420951.html
Wow. No offense, but those are U.G.L.Y.!!!! Those would be overpriced even in CA, IMHO. I wouldn’t pay more than $30K for those (especially the first two).
LOL, look at the window units and burglar bars in the next-door units!
“In some half-finished subs where neighbors aren’t moving in, blight is. Vandals and thieves have smashed windows and stripped copper pipes from the abandoned Taylor Meadows condominiums across from the house where Lightfoot lives. ‘Ain’t nobody there,’ Christopher Lightfoot said.”
RTC attorneys gearing up and calling in the demo contractors a la oil patch crush.
The slogan location, location, location should really be neighbors, neighbors, neighbors. If your neighbors have no values your house will have no value. Some of the midwest getto areas are so bad the cops won’t go into them at night - if at all. It’s not that all the people are criminals, but rather the people are criminal enablers. They actually hate cops more than rapists, murders and thieves.
A different manifestation of these same values is showing up in corporate board rooms. You can’t have a functioning society without a cohesive set of shared values that respect and reward productive behavior. Anarchy and chaos is only slightly worse than a group of people who embrace destructive values.
But those meth-lab guys next door throw some great parties!!!
All kidding aside ….. some of these new-development neighborhoods that don’t “make it” and see a lot of forclosure activity are going to end up a lot skeevier than some folks signed on for, with additional pricing/market pressures to follow.
Hey, some meth labs are run by Citibank VPs in their swanky manhattan penthouses!
‘CRYSTAL’ PALACE
EXEC TURNS HIS PENTHOUSE INTO A METH LAB: FEDS
Photos at the NY post link
December 1, 2006 — The trailer-park drug known as “hillbilly crack” has been putting on the Ritz lately - as federal drug agents uncovered a crystal-meth lab inside the $6,000-a-month Manhattan penthouse of a bank executive, authorities said yesterday.
Michael Knibb, an information-technology vice president at Citigroup, ran the sophisticated drug operation from the living room of his luxury apartment overlooking the United Nations, said Drug Enforcement Administration officials.
The 37-year-old Knibb - who makes an estimated $250,000 a year - allegedly told authorities that he had decided to make his own methamphetamines because he could not find a reliable drug dealer after moving to New York from Seattle two years ago.
Knibb was one of 10 alleged do-it-yourself drug makers busted this week as part of a federal anti-meth sweep dubbed Operation Red Fusion.
The 37-year-old Knibb - who makes an estimated $250,000 a year - allegedly told authorities that he had decided to make his own methamphetamines because he could not find a reliable drug dealer after moving to New York from Seattle two years ago.
I hate when that happens.
they’re just letting anyone into the Meth Dealing biz now, aren’t they? I remember back in the day when the PMC was the only game in town.
(PMC = Pagan Motorcycle Club)
AMEN, climber. I’ve been thinking this myself. I’m sure I’ll get flamed for this, but corporate boardrooms and the streets are not the only places where criminality is rampant. It is a method of operation that appears to have seized hold of the country and it flows down from the very top, from the offices of the administration to the floor of Congress.
“If your neighbors have no values your house will have no value.”
There you have it. This statements works for our broader culture as well. It used to be that debt was considered an ebarrassment. I was taught that it was crass to be ostentatious. Frugality was a value. And…..hey why is everybody looking at me like I grew another head?
I have seen plenty of houses here in Sacramento that are located in less desirable areas. There is a new development of $400K houses located right next to one of the worst areas here.
There have also been plenty of McMansions built next to houses half the size and half the price.
Once coming up from Stockton I saw a McMansion development RIGHT NEXT TO a freeway! WTF?
And now some of our star luxury condo tower buildings are having some problems, too? Anyone surprised.
“‘Prices are dropping. That’s reality,’ said Dan Lepkowski, a real estate agent in Toledo. ‘It’s been that way for a while and the Realtors that don’t admit that aren’t being straight.’”
Gay basher!
We’re in SF Bay area, and our housecleaner just asked my wife whether she thought it was a good time to buy. We’re renting since our rent is approximately 1/3 of what the mortgage would be on the same house, so naturally my wife suggested she wait a year or more to see how things go.
HOUSECLEANER: (thick Mexican accent) But my husband has been talking to a real estate guy who says that it’s a ‘buyer’s market’.
WIFE: Why does the realtor think things will be different in 12 months? The price decreases just started…
HOUSECLEANER: I think my husband asked that, but the realtor doesn’t speak English very well (he’s Asian).
WIFE: Well aside from appretiation, the biggest financial incentive to buy a house is that you can deduct the interest from your taxes. But you need to pay enough taxes to make that worthwhile. Do you pay a lot in taxes?
HOUSECLEANER: (No response)
POST OF THE YEAR!
I second that…^
ROFL..
When you have the follow-up conversation, I expect you’ll hear something along the lines of:
“Our realtor said our payments would only be $500 a month — it is called an “interest-option” loan, I think. That’s less than our rent now ….”
ROFLMAO!
“Coon Rapids Blvd.?” Ben, I think you pick out the articles with funny names just to give us some easy material to riff on……. I mean, it’s like shootin’ fish in a barrel.
Toledo is AMAZINGLY AFFORDABLE. There are only a tiny % of homes over 1 million like maybe 4 total. Here in SoCal its the opposite. Its like nothern mexico or something up by the border.
Coon Rapids is a pretty big, and affluent suburb, in the Twin Cities.
I’ve been tracking homes in Dutchess County,NY. Poughkeepsie to Wappingers Falls. Prices are definitely coming down.
Example, 4/2 raised ranch 0.4 acre 1750sf, been on the market 100 days, started at $369K, now $345K.
another, 4/2-1/2 ranch 0.5 acre 2125 sf, been on the market 130 days, started at $399,now $359K.
Some are selling faster if below $350K, if they are under $300k they go quicker. Typically some tepid $10K drops here and there, but some are defintiely dropping 10%. these are all homes that 3 years ago were in the mid $200K range.
The market just needs a little breather and a little catch-up time.’”
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Yeah, just like I’d need “a little breather and a little catch up time” if I ever raced Lance Armstrong up a mountain!
So what if sellers are taking their homes off the market until next spring? What are they expecting…that people get 50% pay raises in the next few months? How is anything going to change from present times? If anything….there’ll be even less activity which’ll make things worse.
Man..I hope these greedy bastards fry.
“one lot is undeveloped, one house is being auctioned and another one sold for $209,000, about $100,000 less than what Slavik’s home is worth,”
I don’t think so… Why would a buyer want your house when your friendly neightborhood builder is more than willing to cut your legs off at the knees? Sorry, bub, your house is worth 209K not what you paid for it. Oh ,and those other two projects next door? They will be a half built eyesores that will linger for months when the builder declares BK. Oh dear, there goes the neighborhood.