Buying A California House “Doesn’t Make Sense Right Now”
The Press Democrat reports from California. “Home prices fell more sharply in Sonoma County last month than anywhere else in the Bay Area, except Solano County, according to a report issued Thursday. In Sonoma County, prices have dropped 7.7 percent to a median of $530,000, while sales have declined 22.5 percent, according to DataQuick.”
“Steve Cochrane, an analyst with Moody’s Economy.com who tracks Sonoma County’s economy, said he wasn’t surprised by Sonoma County’s drop. ‘I’ve always felt the Sonoma County housing market was at fairly considerable risk,’ he said. ‘It seems like Sonoma County is one of the weakest economies in the Bay Area. There’s hardly any job growth to speak of. That’s essentially the basic building block of the economy,’ Cochrane said.”
“The county has lost 3,100 jobs over the past year, putting the brakes on what had been a sluggish economic recovery from a recession that was longer and deeper than expected.”
“There is still a glut of homes available. ‘We haven’t seen any falling off of the inventory, hardly any at all,’ said Mike Kelly, an agent in Santa Rosa.”
The Contra Costa Times. “The typical monthly mortgage payment for Bay Area buyers was $2,865 last month. That was down from $2,921 for November a year ago. Adjusted for inflation, mortgage payments are 12.9 percent higher than they were at the peak of the prior cycle in early 1990.”
“Paul Ward, a broker associate in Danville, said he thinks the lower payments have to do with the average buyer believing less is more. ‘While last year was ‘Get as much as you can,’ people are definitely more cautious these days,’ he said. ‘They don’t mind buying a smaller home … and don’t want to spread themselves too thin.’”
The Sacramento Bee. “Analysts called it the slowest November in nine years in Sacramento and Placer counties. Reports show that many sellers have pulled their homes off the market, greatly reducing resale inventory.”
“November’s sales pushed the overall total of new and existing homes and condominiums closing escrow in 2006 to 38,208 in Amador, El Dorado, Nevada, Placer, Sacramento, Sutter, Yolo and Yuba counties, reported DataQuick. That’s 16,129 fewer sales than last year, a factor that has purged area payrolls this year of countless real estate agents, loan specialists and residential construction workers.”
“The median price of a single-family detached resale home declined to $345,000, the lowest since March 2005, according to DataQuick. Placer County’s $442,500 median sales price for an existing detached home remains 12.2 percent lower than its peak of $504,000 in Aug. 2005.”
“While many sellers have given up for the year, others are quietly seeking appraisals to determine an appropriate asking price that will move their home quickly, said Sacramento appraiser Rebecca Ballew. ‘I’ve had three calls in the last week to do appraisals before they put their house on the market,’ Ballew said. ‘They want an idea of where to put it so it doesn’t sit there.’”
The Times Standard. “The housing boom that hit the North Coast and pumped up housing prices locally and around the country has thrown a wrench in the old buying and appreciation formulas. Now, economists and others in the industry are asking themselves whether it really is better to rent a home, duplex or townhouse at the moment rather than buy.”
“Erick Eschker, Humboldt State University economics professor, said that for the first time in a long time, renting may be the wiser option.”
“‘I don’t think we’ve ever seen it this bad here. Not since the Great Depression has there been such a difference between (rents and mortgages),’ Eschker said. ‘I would be a fool to purchase a house right now, unless I could find a house at the pre-boom prices. I think we are in trouble and I’m not going to lie about it.’”
“Rents for duplexes, townhouses and homes with two, three and four bedrooms have been averaging between $1,100 and $1,200, Eschker said. According to the latest affordability release from the Humboldt Association of Realtors, the Humboldt County median house price went up in October to $325,000 from a September median of $306,000. The average mortgage rate on the October median-priced home was $2,009.89.”
“Arcata appraiser Jon Brooks said he has seen a mild correction in the real estate market of around 10 percent in the past year. However, Brooks said that until just recently rent prices were much higher.”
“‘This is the law of supply and demand. When housing prices go up, builders want to build apartments and create subdivisions, and we’ve just experienced a substantial increase in inventory,’ Brooks said, explaining increased competition as being the real reason for drops in rent.”
“Ming Tree GMAC Real Estate owner Larry Doss said he does agree with Eshker on one point. ‘I agree with the rent versus home-cost argument. It doesn’t make sense from an investment standpoint right now,’ Doss said.”
“One concern Doss and others in the business have is the huge run on negative amortization mortgages. These offer ridiculous teaser rates with low or no down payment and small mortgage rates, but requiring a big balloon payment a few years down the road.”
“Humboldt County has seen a large increase in the past few months in home foreclosures, and Eshker said that as interest rates rise, that rate is only going to continue. Doss said he is expecting some changes in the availability of negative amortization loans on the national policy level, and said he hopes to see them come sooner rather than later.”
“‘Many in the mortgage industry categorize these as irresponsible, and Doss said that it goes back to the old saying, ‘If it sounds too good to be true, it probably is.’”
“Erick Eschker, Humboldt State University economics professor, said that for the first time in a long time, renting may be the wiser option. ‘I don’t think we’ve ever seen it this bad here. Not since the Great Depression has there been such a difference between (rents and mortgages),’ Eschker said. ‘I would be a fool to purchase a house right now, unless I could find a house at the pre-boom prices. I think we are in trouble and I’m not going to lie about it.’”
Witness a rare event: An honest economist is quoted in the MSM.
I’d be willing to call him honest if he had made those statements 2 years ago.
He may well have been saying these things 2 years ago. But it’s only now that only an idiot can miss the Signs Of Impending Doom that the [idiot] media are quoting him.
I just did some searching and I think you may be correct, he appears to have been somewhat of a bear for a while now.
I grew up in Arcata and went to Humboldt State. Don’t be too hard on them, more than like this housing news DID just reach Eschker and the Econ Dept at HSU.
If you’ve ever been to Arcata/Eureka, it’s sort of a lost world. Population growth = 0 in 40 years. VW busses with peace sign on front …. New movie at the theatre, “Home Alone” …..
The movie last week was “Beetlejuice.”
Speaking of a “lost world,” it is funny that everyone here believes that retirees will cash in their overpriced POS in LA and move up here to buy another overpriced POS. Although, this does appear to be what is happening. I personally know of several whose families have done just that. I can’t understand it, since the hospitals are so bad that anything more than a broken arm requires a life-flight to Santa Rosa or Redding and the constant and depressing rain, wind and cold. I could think of a thousand better place to retire that are cheaper than Humboldt county.
Life in Humboldt Couny is called “Living Behind the Redwood Curtain” for a good reasons. Good place to buy tie dye clothing though. No trains, no buses, no jobs; but no Wal Mart or Home Depot or Olive Garden either. Average salary is under $30k a year … average cost of a house is out of the range of 85% who live here; average age a POS house here is somewhere in the late 40’s or early 50’s. Welcome to Paradise equity barons one and all. I sold early and am now enjoying low rent, no taxes, and a ring side seat for the housing show!! sssshhhhhhhh the ring master is just now saying: “Ladies and Gentlemen!”
My father (retired HSU business prof) told me about a year ago, that the State University System was planning to double the enrolment at HSU, but I have not heard or seen any more about this. That would certainly impact housing demand in the entire area (over time of course).
You bring up a good point Anthony about the medical. Chico is not much better, as the local hospital has been running on the brink of insolvency for the last few months. Most in the area that are concerned about their care, head for Sac, Davis, or like me – back to the BA. Do people really research this before moving to Humboldt? My guess is not, just, “gosh, look, pretty ocean”.
Yet ….. the families & retirees continue to migrate there … and here since Chico was labeled one of the great communities for raising a family, retirement, etc. After you’ve been here awhile, you realize it has its issues. You think Washington and Oregon residents don’t like you? Try moving to Chico. A very tight dirty click runs this place, and they don’t like you big city folk ……. but they like takin’ you money.
If you’ve tasted the ‘sweet nectar’ of life outside places like Chico and Humboldt, the best advise I could give to someone wanting to move there is RENT for at least 1-2 years, and give yourself an opportunity see what it’s really like.
“the hospitals are so bad that anything more than a broken arm requires a life-flight to Santa Rosa or Redding”
That’s unfair. Trauma care at Enloe is quite good.
I lived in small town just east of the Sierras, about 85 miles from Reno. Beautiful scenery, retirees loved to move there, but then they moaned about the ice in the winter, and really bitched when they experienced the 28 bed hospital. That was their biggest complaint, lack of adequate medical care. What did they expect?
I lived in small town just east of the Sierras, about 85 miles from Reno. Beautiful scenery, retirees loved to move there, but then they moaned about the ice in the winter, and really bitched when they experienced the 28 bed hospital. That was their biggest complaint, lack of adequate medical care. What did they expect?
Chico’s population is falling. I work for Butte College and our student population is in decline and so it is for all of the school districts in Butte County. I have lots of friends who are moving to Texas or back to the BA. It is way too expensive here. Buying a house here is murder for first time families. And the prices are dropping! I had a friend who bought a house for $324,000 eight months ago. Then one of their neighbors with the exact model home tried to sell their house for $310,000. Then those sellers dropped it to $299,000 with no luck. Now another neighbor with the exact model home is selling for $285,000. My friends have lost $44,000 value in eight months alone and it will certainly go down more now that the winter is approching.
Now realtors and morgage brokers in Chico are losing their jobs and they can no longer affort the expensive homes they bought last year. We will have to wait until spring but it seems that 2007 is going to be a real killer. We now have over 9 months supply on the market. Rents in Chico seem to be going up but it is difficult to say. There seems to be a lot of doomed homesellers who now think they can rent their homes for crazy prices. Inventor of homes for rent (in the paper) is now over 100 and it was only 64 in October. The inventory of rental is growing.
Californians are moving out of state. The idea of LA retirees moving to SF Bay Area is laughable. Many are moving to Washington Oregon just like many moved to Utah in 1991.
No kidding. I love all these REIC types coming out of the woodwork ONLY JUST NOW and stating the plainly obvious –at no risk to themselves, their businesses or reputation, because now it’s become accepted fact.
Where was Eschker & Doss’s concern 2,3,4 years ago –when it might have made a difference? Oh, that’s right, these a$$hats were too busy taking juicy commissions & fees, stuffing their portfolios full of HB stock and pushing “exotics” like crack to everyone with a pulse.
I’d say it sounds more like C.Y.A. time and buying some free media “insurance” for all those lawsuits and government inquiries coming down the pike real soon.
Actually, Professor Eschker has been talking about the bubble in Humboldt County for over a [pdf]. He’s also had a link to this blog for some time now.
…for over a year now
“Is There a Housing Bubble in Humboldt County?
Over a year ago isn’t real impressive compared to some who saw this thing building 3-4 years ago (Baker, Fleckenstein, Ben, Patrick, etc.), but, I guess he deserves a little credit for preceding the rest of the MSM.
I should clarify. “At least” over a year. He may have been talking about this 3-4 years ago for all I know.
‘Over a year’ is almost the correct answer. You could still have made a killing with little risk 3-4 years ago. I personally underestimate the willingness to destroy the dollar. I knew it would benefit the government but it doesn’t benefit the massive creditors in the long run.
Speaking of economists who were ahead of the curve…Ed Leamer & Friends were already bearish.
IIRC, Ed, in particular, was making bearish remarks in late 2003/early 2004, saying the housing market was going to slow.
Makes me wonder why he seems to have changed his tune a bit.
——————————————–
UCLA Anderson Forecast Asserts Expansion Won’t Last Through Bush’s Second Term
“Tepid at Best” Growth for California Forecasted Through 2006″
March 15, 2005
UCLA Anderson Forecast
LOS ANGELES – In its first quarterly report of 2005, the UCLA Anderson Forecast asserts that the current expansion in the national economy is nearer its end than its beginning. While the report, released today, stops short of predicting a recession—at least exactly when the next recession will hit—it does outline a scenario that points towards a slowing of the economy and an eventual downturn. In California, slow growth is expected over the next few years, as a weak housing market offsets some of the strengths in other parts of the economy.
http://www.uclaforecast.com/contents/archive/media_3_05_1.asp
Remember…the main stream media is a LAGGING indicator.
Even if people are/were saying it…they weren’t going to cover it. That is why people turned to the BLOGopsphere to get info.
SoCalMtgGuy
http://www.housingbubblecasualty.com
And imagine she’s saying that after a bunch of Sacramento FBs are already in a world of pain.
Merry Christmas! Be sure and say hi to that guy in the Goldman Sachs office who probably made 669K this year.
Don’t ya just love how everybody bitches about oil company profits, an industry that actually gets product to people, and not a freaking peep about Goldman Sucks and their record breaking profits from nothing less than a skimming operation.
Financial economy….what a laugh.
A lot of the brokerage houses’ profit comes from trading on their own accounts, doesn’t it?
Yes, including ones like Schwab who claim to be getting you the best prices on your trades. Oh, the stories I could tell about Schwab, ETrade, Ameritrade, etc.
Yup, about half comes from the in house trading blocks. Must be nice to have the head guy at Treasury coming from your house. Front running, laddering, and skimming: the easy way to make a fortune.
I bitch about oil company profits because they come from the act of selling “my” oil back to me. Resource extraction without severance taxation is theft!
How is it “your” oil? Oil companies bid for the rights to drill in most cases. They put in the huge up front costs and risked the capital.
Most of the oil usage in this country is produced in foreign countries. Some of that oil is owned in part by US oil cos, so they profit from that too. Is that yours too?
…not to mention that in states like Texas, Alaska, Wyoming, New Mexico, Louisiana, etc. they pay royalties to both the state and federal governments. Too bad California voters were to dumb not to vote into that cash cow.
The folks in Humbolt should go back to doing what they’re good at and that is growing the mighty wacky tobaccy. Then they might be able to afford these overpriced POS’s.
I went to humboldt state and was glad to get out of there.The timber industry is a big part of the economy up there. Have you bought any redwood at home depot lately? The wood is not cheap.I remember at buch of people playing bongo drums in arcata. They grow some good wacky weed up there in the back woods.
Just a few years ago Humboldts largest private employer was the Bank of Humboldt. They employed over 400 employees, a large majority was customer service for the merchant card business. Well they had a little problem with the merchant card business and sold it. Then they moved the whole bank to Roseville CA near Sacramento, now they are owned by Umpqua.
Humboldt has some nice restaurants, one I like especially is the Sea Side Grill. I think. No Humboldt is going nowhere, but I do think a lot of people are moving there to retire. Most are poor retirees trying to scratch a living on SSI and whatever else they saved. Probably selling their house in So Cal and buying there pocketing 200K for retirement and living large on can food until their dying days.
Humboldt State Univ is a big employer (also College of Redwoods). A lot of San Diego kids go there cause it’s the farthest they can get from their parents without paying OOS tuition. My daughter graduated from HSU in 3 yrs cause it’s so small the kids can get all their classes, not like UC and the 5-6 year plan. The average age of HSU students is surprisingly older, in the mid-upper 20’s, because the low cost of living allowed married-with-children to go back to school with part-time jobs and still put food on table.
funny you say that sd renter when i was teen that is what humboldt county was known for
the sticky icky stinky stuff
lots of “farmers”
Even 2k rent is steep for Bay Area based on current avg earnings. I could see how humboldt will drop by 50% … there just isnt that kind of jobs that will support prices like that. This is the first time I read on Bens blog someone in the media now comparing calling buyers fools!!! Times are a changing…
Until we see how this situation shakes out, I’d say that buying a house just about anywhere in the US doesn’t make sense right now…including in the so-called “non bubble” areas. I bet that we won’t know where all the bubbles were until this is over…
Very true. Not only that, the secondary impact of this housing bubble is going to be of greater magnitude than any time since 1930.
For example, if Jane and John Doe of San Deigo California are struggling due to their option ARM resetting… They won’t be buying a new SUV or much of anything.
This time, too much of the money is going to go overseas. Normally, one can make the argument that its a closed system. Not quite… this time.
Neil
Or they may be struggling because they’ve run out of cash from their last refi, and no one is willing to refi them again.
Credit is great in a pinch, but it is NOT income. Many seem to forget this small distinction.
Made an offer on a house at about 2003-2004 price. Was it too high? (It was turned down, despite the house being on the market for 15 months).
Be grateful your offer was turned down. Wait 3-4 years and you can buy it from the bank for 1999-2000 price.
Agree with HARM.
You should check and see how much the seller owes on it. That may be why he rejected your offer.
TxChick-
How would one do this?
Also, relating to your comment re: Schwab, ETrade, AmeriTrade… who do you recommend doing trades through?
Thanks!
You can check zillow.com to see the last sales price. This will give you and idea at least.
Zillow for start… also check if your local goverment agency has information online. You can find this. Check on Yahoo RE section…Homevalues…
It was paid for cash in 1997. Elderly couple have passed away. Kids are trying to sell the house. BTW, I do not want to wait 3-4 years. Waiting 2 has been hard enough.
“Paul Ward, a broker associate in Danville, said he thinks the lower payments have to do with the average buyer believing less is more. ‘While last year was ‘Get as much as you can,’ people are definitely more cautious these days,’ he said. ‘They don’t mind buying a smaller home … and don’t want to spread themselves too thin.’”
Isn’t it a shame that the housing bubble brought us a record glut of McMansion and luxury condo construction, instead of housing that matched the population’s basic needs distribution? Such was the slippery slope created by easy money, loose lending and rampant speculation which characterized the many long years of bubble price inflation, when buying a home for investment purposes seemed like a prudent way to add a third household income.
Even the auto industry has a better read on what consumers REALLY want. And that’s not saying much!
I think builders know what people want, it’s a matter of what can they actually afford.
Maybe you missed my point, which was that newfangled real estate investors were happy to buy McLuxury condos and McMansions as second homes they never intended to live in when prices were going up at double-digit rates year after year. This kind of housing was highly profitable to build in recent years thanks to the bubble, even though it did not meet fundamental needs.
My father in-law has a craptastic McMansion outside of Charlotte. The walls wiggle when you shut the entry doors, which you have to slam to get shut as the doors themselves are utter and complete crap! These McMansions are lucky to be considered 25 year structures.
No wonder people weren’t taking out 30 year mortgages on these places as the debt would last longer than the house!
Santacruzsux,
do you know what builder built your FIL’s house. Mike Morgan, in Fla.,has been tracking lousy construction in Centex and KB homes? Curious if their problems are national.
I’ll have to ask him who the builder was. If I see you on another thread later I’ll give you a heads up.
“Steve Cochrane, an analyst with Moody’s Economy.com who tracks Sonoma County’s economy, said he wasn’t surprised by Sonoma County’s drop.”
The first question that comes to mind when I read another story about an economist who “wasn’t surprised” by something is, “Why is he first mentioning it now if he anticipated it before?”
What makes even less sense is investing in those homes. People buy homes and rent for 1200 a month with monthly expenses over 2000.h
What gives. I see adds were I live that say ” great investment, will cash flow with a neg-am loan”.
That’s one for the Hall of Fame. I can get my Visa card to cash flow too - until it hits the credit limit.
But everybody wants to live in the Bay Area! There aren’t enough houses here….buy now or be priced out forever!
I’ve been listening to that bullsh*t for the past few years. Sure the Bay Area is nice…when I ride my motorcycle down Highway 1 between Halfmoon Bay and Santa Cruz I do consider myself lucky to be here. But if I owned one of these over-priced houses and was paying 40 to 50% of my income to my housing expense I wouldn’t be able to afford my motorcycle so I wouldn’t be feeling so lucky because I wouldn’t be riding a bike down Highway 1 thinking about how lucky I am.
People here in the Bay Area have convinced themselves they are better than everyone else and smarter than everyone else so if you want to live here you must be willing to pay the price.
Let’s figure if the average mortgage is payment is $2,800 a month the average property tax is about $600 a month and the average insurance is about $150 a month. So the real average monthly housing expense is about $3,600 a month….damn that’s alot of money!
“People here in the Bay Area have convinced themselves they are better than everyone else and smarter than everyone else”
From personal observation, it seems to take approximately 3 years for that to happen. Almost like clockwork, after someone I know moves to the Bay Area for three years, those beliefs materialize. Amazing.
It’s the people who move to the Bay Area who feel a sense of entitlement and superiority. Different breed altogether from those of us born and raised here.
Many times if find the people who have been here the shortest amount of time are the ones who are most ardent about keeping others out.
It’s a selfishmess driving this but they wrap it in the “protecting the environment” attitude. But if they are so concerned about the environment why are they not allowing more housing being build close to the job centers instead of forcing people into their cars to pollute the air and water?
We suck!
you get the exact same kind of attitude from non-native new yorkers, they complain about everything
it is so crowded! no sh*T sherlock 8 million people on an island. i almost long for the high crime to return so these dipsters go back from where they came
I witnessed it taking 3 months, from someone coming from outside the US and A.
Lots of different people come to the Bay Area all the time, and experiences do vary pretty broadly. My first three months in the Bay Area were the last quarter of 1991. The whole area was hurting, housing was engaged in a slow and painful backslide, and the burning of the Oakland hills in November literally left a dark cloud over much of the area for a while depending on the winds and where exactly you were. If it was clear then you might be able to see the charred spots which were numerous and reached major freeways at several locations.
The Bay Area is a very special place, and that includes some very special curses including much more frequent earthquakes, landslides, and wildfires than most places.
Special, schmecial. I lived in the Bay Area for 30 years. I think people in the Bay Area think they’re so special because that’s what they hear and they haven’t experienced the many other special (and more affordable) places there are to live in this country. Once you start moving around a bit and then go back to the Bay Area you think “It’s not so great here”.
Most Bay Area residents are transplants so I disagree that they don’t know better.
I’ve lived in affordable North Idaho and Western MT. Nice places with a simplier lifestyle but you can’t get good work. Affordability there is just as tough. Things cost less and you make a lot less so the motivation to stay is often for the lifestyle.
SV people are busy - too busy. It’s competitive and consumptive culture. Long hours and work weeks are expected and it’s not as family friendly.
Those that leave their real life elsewhere and follow some fantasy spend most of their mental energy justifying that choice. It’s the unfortunate fate of coastal california, lots of narcissistic energy from back east.
RayW,
I could copy what you said about SanFran property and paste it into a comment about NYC. People in New York have this stupid notion that soooo many people around the globe want to live in New York and its impossible for real estate prices to come down. Prices have already quietly slipped 10% from peak prices. But you wouldn’t know that from reading the local press. The Wall Street Journal just had an article today about how manhattan real estate is still on fire. All the Wall Street bonuses are supposed to bump real estate up even higher, and NYC’s “international appeal” means that real estate here is somehow immune to the laws of supply and demand.
PS: From my research, its 30% to 100% more expensive to own than to rent in NYC at this time. Especially in Manhattan.
hey brooklyner i said that about it costing much less to rent than to own on curbed and was called a bitter renting loser
lol- i am tired of going to my bank and depositing all my money every week, i am so ashamed
“Highway 1 between Halfmoon Bay and Santa Cruz”
Just an awesome area and another reason why so many people live in CA.
If I had five bucks for every time I heard the statement..”they aren’t making anymore land” or ‘buy now or be priced out forever’ crapola (is that a word?). Irritating as hell. BTW it’s Half Moon Bay…THREE words. Guess you missed the signs. Anyways it’s where I live again after several years in South California. Yessir redneck hick city down OC/O’side/San Diego way. No thanks. Lived in the NWest too…does it ever stop raining there? Oh yeah that’s right in June when the humidty is as thick as any in Detroit. I grew up in Santa Clara back in the day when there were still orchards and 4-H clubs. Even worked in “Silicon” Valley in the early days of Rolm, AMD & Dysan. Anybody remember them? Do I think I’m better than other people? No. But I think I live better being back home by the ocean. I’ve owned three houses in CA. Sold the last one in 2004 in O’side. Now I rent a nice little flat with a huge backyard, three blocks from the beach for 1150.00, all inclusive except phone. Can’t beat it with a stick. Don’t know when I’ll buy again. Prices all over the CA are …hell you all know….
Why I hate the REIC:
Someone I work with and admire professionally just opened an escrow for a $470K SFR in Ventura. It’s a fixer-upper; the appraiser told them that there was “no way it was worth less than $515K.” She and her husband (who’s in construction) have been frustrated renters for years, now their “thrilled” because they’re going to be “building equity.” Yes, I tried to warn her, and no, she didn’t listen. Years of relentless REIC propaganda about “throwing money away on rent” have left their mark on our culture, and it will be more years still before its affects are reversed. It’s very, very frustrating to see good people continue to get sucked in . . .
“Years of relentless REIC propaganda about “throwing money away on rent” have left their mark on our culture, and it will be more years still before its affects are reversed.”
I think it may only be a matter of months before this notion is dispelled. Lots of people underwater already and we have only just begun. I don’t have any close friends or family who bought at the peak, but imagine that those who do, are already hearing the sob stories. These tales will work their way through the very fabric of this country. I think, in as little as a years time, the general public will be very apathetic regarding the purchase of real estate.
Here is a desparation ad in the SD Craigslist for a LV home. Sounds like a true bargain. NOT as Borat would say.
I do believe her caps key is stuck…either that or the bargain is so great that she is shouting from the highest mountain tops.
GREAT DEAL ON FIXER-UPPER!!! ***PRICED ACCORDINGLY, FRESHLY PAINTED INTERIOR, HAS ALARM SYSTEM, ALL APPLIANCES INCLUDED, CITY VIEWS, CLOSE TO SHOPPING & FREEWAYS. HOME NEEDS COSMETIC REPAIRS, WINDOWS BROKEN, INTERIOR DOORS REPLACED/REPAIRED, DOWNSTAIRS FLOORING LEFT TO YOUR IMAGINATION, SAME BACKYARD. HOME SOLD AS IS!
Price: $249,900
Same type of houses are going for about $270,000 in the same neighborhood.
2-story Single Family Residential
1,852 sqft
4 bedrooms, 2.5 bathrooms
3,485sq ft lot
$45/M association fee
Call or email Colette Smith with Re/Max Home Store with further questions.
Cell (702) 285-6968
Office (702) 396-7684
E Fax (702) 921-6345
email: LasVegasRealtor.Colette@gmail.com
Location: Las Vegas, NV
It’s NOT ok to contact this poster with services or other commercial interests
249490058
Is that one of LVLandlord’s properties? She has been absent from this blog for quite a while.
If it is her, you should email her and tell her that we miss her:)
“HAS ALARM SYSTEM”
What a feature. LOL
And yet windows are broken. This is an old school fixer: a real horror of a home in a troubled neighborhood. And it has the same mark up of roughly double the actual value that everything else does, so go figure.
At least we know what the dollar will be worth toward the end of this. Around fifty cents, give or take.
i’m surprised she did not state “indoor plumbing” along with the appliances included
let this dimwit twist in the wind
I’m in SD as well, check this story out…
Last week I saw an ad for a fixer in Talmadge on craigslist so I stopped by the property. The house was beyond fixer. It needed to be gutted top to bottom. Yet the seller still wanted 390k.
When I called and asked about the house the agent was very evasive. When I asked about the price the agent started YELLING at me! I couldn’t believe it. After about 5 seconds of the sellers yelling I just hung up.
What kind of crazyness was that?
When was the last time you were in a store and the manager started yelling at you when you asked about the price on one of their products.
“Erick Eschker, Humboldt State University economics professor, said that for the first time in a long time, renting may be the wiser option.”
“‘I don’t think we’ve ever seen it this bad here. Not since the Great Depression has there been such a difference between (rents and mortgages),’ Eschker said. ‘I would be a fool to purchase a house right now, unless I could find a house at the pre-boom prices. I think we are in trouble and I’m not going to lie about it.’”
Ben, do you have a “Hall of Fame” for the honest people like this guy?
But that qualifier…”and I’m not going to lie about it.’
Others do, and would, but I won’t? I could, but not this time? I have in the past, but this time it’s different? Great profession.
The pressure to lie and keep this market afloat must be pretty strong when this guy actually feels the need to justify telling the truth.
LOL
Erick Eschker is probably a poster here…c’mon, which one of you is him?
According to the latest affordability release from the Humboldt Association of Realtors, the Humboldt County median house price went up in October to $325,000 from a September median of $306,000.
Like I’ve said, prices in Eureka have really not changed too much in the past year, and inventory has actually declined about 25% in the past three months. The few open houses I’ve attended recently here were fully of lookers, but nary a serious buyer. I’m anxiously waiting for them to fall, as they have in other areas of California, but, as the article states, the baby boomers will save us all by buying properties!!
Professor Eschker has actually been a bear for some time. If you check out his page referenced in the article, you’ll see this. In fact, he has a link to this very blog!!! But, the MSM don’t often quote him as they would rather have some Humboldt Association of Realtors clown talk about “buy now or be priced out forever!”
Humboldt Real Estate Economics
This has been one interesting year. Half-way through the year, I finally felt as if I was really not that stupid to refrain from buying. The bubble started bursting. And I thought the rising mortgage rates would soon put the final nail in the coffin and by 2008, much of the insanity would be wiped out.
Now the rates are actually lower than summer. Stock market is doing great, which greatly affects the psychology of BA - due to a lot of tech people investing, having ESPP. Salaries have not increased a lot, but honestly job market is doing OK here. Still, the housing prices continue to slide downwards.
Even though people (outside this blog) are not accepting that last few years were simply crazy, the change in psychology says, I think they know in their heart that this is not going to end well.
The subprime melt down has already began. And because of falling home values and rate resets, people who already bought they really cannot afford, are going to be in trouble. So downward pressure on house prices will continue - despite low rates and good employment. Probably the first time in history ! Amazing.
I do not know who is right - the bond market which is predicting a recession or the stock market who’s chanting the “Goldilocks mantra”. The effect of people tightening their budget is not felt adequately yet. So, the bond market’s prediction has a better chance of proving right.
Stuck in the BA,
I know what you mean. I am astonished stocks have rallied so much in the last half of the year. People are ignoring the housing market, much like they have been downplaying any effect that the economy will suffer when Joe Sixpack can not get a cash-out REFI. Despite the drop in interest rates, many of these recent buyers will still not be able to afford their homes, so I would expect a rash of foreclosures soon. The stock market is bound to crash, given it has had 4 up years (and not a single day where the index has dropped 2% in over 3 years–a big rarity). Although I’m not making any risky bets (shorting homebuilders, for instance, which ended up being dangerous given their recent rally), I am pretty much all cash and Treasuries.
Could it be hot money is leaving housing for stocks.
When I try to heat up my money it tends to evaporate
Hot money is moving internatinal. Best group has been international stock . My Fidality Discovery is up 18%
Keep in mind that the bond (and debt) markets are much larger than the stock market and the players tend to be more sophisticated (Bill Gross vs Jim Cramer). I would tend to believe what the bond market is saying rather than the stock market.
Goldilocks was ‘05, when everything was still booming. ‘06 has been the euphoric last gasp at the end of the cycle, the markets’ final run-up while ignoring the increasing signs of exhaustion and omens of change.
Goldilocks is about to get mauled by the bears.
“I do not know who is right - the bond market which is predicting a recession or the stock market who’s chanting the “Goldilocks mantra”.”
Look at it this way…for the Goldilocks principle to work, the economy has to be “just right” today…and tomorrow…and the next day…and the next day…and (well, you get teh picture). When the market is priced for perfection, you have to wonder how long can perfection last.
I’m wondering if the big money (read: hedge funds) are taking money out of the equity and futures markets (read: oil, gas, and natural gas) and are now dumping it into the stock market.
For those that are trolling on the North Coast and are still convinced that there is not a bubble, check this out (from the Professor):
http://www.humboldt.edu/%7Eindexhum/realestate/real.GIF
No bubble here, move along!
Extroplating the graph expect 5 to 6 years to return to “normal”
I live in the town of Sonoma: 11 homes have been forsale since I moved in June 06 (renter) many had been on the market since Jan. One closed in Nov and another has a “pending sign) each one has had price reductions from $620 to $550K. don’t know what the pending sales went for but the November sold @ 450K. My rent is $1700 month.
Hopefully Sonoma and Santa Cruz are leading indicators of what will happen in SF and the SF Peninsula. Sonoma and Santa Cruz seem to have significant declines in both sales volume and price. While the Peninsula has had sales volume declines prices have held up pretty well so far. Maybe 5-10% down from 2005. Am always interested to read posts regarding these two markets even though they are not in my target area.
Local companies have increased headcount by 4.5% last year. However much of that was for positions outside of California.
San Diego and Sacramento had the biggest run up and, according to The Chronicle, are most vulnerable markets in CA.
In the Bay Area, fringe communter cities of Santa Rosa (city) and Salinas to the south, have the highest ratio of home prices to local income in the USA. You’ll see corrections begin there and move inwards.
Santa Cruz (city) desn’t strike me as a market tightly coupled to the SF Peninsula.
Santa Cruz has always been seperate from SF or South Bay and more toward Monterey Counties… All ago business…. town is shut down during non season for business. Go there today and its a ghost town..
Thanks for all of the comments above.
These homes are all within 6 blocks of my home.
You need to invest in popcorn. Lots of it.
11 homes? Soon it will be many more.
Neil
Humbolt county economics
1 pot mid size pot plant produces 1 pound of the good stuff.
1 pound of the good stuff sells for $4000.00
1 grower can easily grow 25 plants in a 8 month growing cycle ( this is a full time job with 4 months off
Income for grower=$100,000/ year tax free
Grower says” I can afford a $400,000 house on my income”
They taught that in econ 101 when I went to Humboldt State.
The college paper was run by the business school in those days cause the administration didn’t trust the journalism dept. Strange.
Little O/T but dealing with California….
Maybe one of you good data miners can help me…
The Dept of Finance in California said NET migration out of California was 29,000 I believe for 05…Can anyone tell me what the GROSS migration was out of California ???
Several articles recently point the net migration as long term trend…the number is much larger..
The San Jose mercury article showed people and jobs are being shipped out of state. Again long term trend.
Also showed how high salary folks are moving out. Its not just low earners as some would think. Many are moving up north to Oregon and Washington.
I have a friend who went to a real estate seminar in vegas last weekend,he is enthused about a deal he was offered by vegas builders who want to “borrow” his credit…..he told me he can get 40k off the price of a new vegas home.anybody know about this scam? he is visiting me tomorrow and we will go over the numbers….btw the peak median price in sonoma county was $619k in august ‘05,now $530k,and the paper reports a 7.7% decline.hmmm.new math? i’m now separated and living in a perverted school bus with fake lava walls in the bathroom any bears in west sonoma county are welcome to drop by for a cup of coffee,the neighbors make wonderful pinots.
He could end up in jail . Tell him not to do it .
san luis obispo county year over year declines 8.4% music to my ears,because the decline is probably like 15%,this county had the most insane bubble run up anywhere in ca.ocean view homes in pismo heights were 250 k in 1994 now they are 750k…..sellers are holding tight,but i see signs of it bursting,it has not happen yet…i know its not different here…..
On the TV show Numbers tonight, they have a serial killer that kills realtors in empty houses. At least I think that they’re realtors.
Headline says:
“Buying a California House Doesn’t make sense right now”
My nomination for the most obvious statement of the year.
Or last year, or the year before, or the year before that.
Could even say begining at 2000 …
Yeah, from 2001 on San Diego looked sketchy for real estate prices. After 2003 the loonies had escaped the loonie bin and were out buying houses and condos for any amount of money. They obviously did not care.
i was in san diego 6 months ago on vacation and could not believe
the amount of condo’s in the city. they even were building outside petco park, i mean you could sit on your terrace and watch the padre’s play. it was mind blowing to say the least. and i’m from ny where they build on any vacant lot