Bits Bucket And Craigslist Finds For January 11, 2007
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
May 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
wci bal harbour update
and
time share madness
http://www.immobilienblasen.blogspot.com/
The ATM machine has really imploded.
The numbers are astounding. Greenspan and American bankers are a real bunch of farrts. Are the numbers that crazy ?
Stephen Church at Piscataqua of Research could use some too, as I gather from reading his report “The Consumer Crunch: December, 2006 Update.” He agrees that “The slowdown in household mortgage debt flow SHOULD lead to a recession - BUT the Federal Reserve is determined to prevent one.”
He goes on to say that things are worse than just a lousy $300 billion gone missing, as “The latest economic statistics show that consumers depended on new debt for 90% of their cash flow during 2006. In 2005, 88% of new consumer cash flow came from debt.”
I think people loosing big in real estate, don’t get it. This time it’s different. Rates are going up in the UK and for a long time. Now that they suckered all these lenders in, it’s payback time for the bankers. Time to strangle the stupid borrowers that tought that it was a sure thing. Let’s see how long the long term will last. The bond market will be really interesting to watch. A lot of money will be lost also in the bond market. Cali the godess of destruction is at work eating away the dreams of all these future real estate millionnaires.
***************************************************************************
Treasuries Fall After Bank of England’s Surprise Rate Increase
By Elizabeth Stanton and Deborah Finestone
Jan. 11 (Bloomberg) — Treasuries fell after the Bank of England unexpectedly raised its benchmark interest rate, pushing yields higher on European bonds and cooling speculation that the U.S. Federal Reserve will lower borrowing costs this year.
The U.K. decision may indicate a greater likelihood of increases by other central banks, including the European Central Bank, aimed at quelling inflation risks. British policy makers said inflation risks “now appear more to the upside.” Fed Governor Donald Kohn on Jan. 8 said it’s “still too early” for the central bank to relax its guard on inflation.
“This was a signal to investors that they should focus on the fact that the world is still growing and inflation is still a worldwide headache,” said Ajay Rajadhyaksha, co-head of U.S. fixed-income strategy at Barclays Capital Inc. in New York, one of the 22 primary U.S. government securities dealers that trade with the Fed. “Interest rates will continue to move higher.”
Here is this morning’s trading alert which warns about the Plunge Protection Team pushing the market up…..
> Trader Tracks Trading Alert 9:20am 01-11-07
Analysts claim they can tell the future of the markets by watching the
action for the first five trading days. We prefer to watch at least the
first ten trading days. At this point we have seen enough and charts are
showing a correction is on the horizon. The carry-over buying power for
mainstream stocks from 2006 remains in force. While markets do things at
times with little or no warning, we see the major stock indexes topping
out
for correction. Understand the Plunge Protection Team seeks three major
objectives: (1) Keep the Dow above 10,000. (2) Keep the US Dollar above
80.00. (3) Do not let gold get into a runaway rally. Never ever
underestimate what they can do to manipulate those prices. Eventually
major
trends will win, but getting there can be rough.
And speaking of the Plunge Protection Team, they are on duty this morning. Look at the chart
of MHO, one of the homebuilder stocks, which reported this morning that “new contracts for the quarter ended Dec. 31 fell 61% from a year earlier to 353 homes. The Columbus, Ohio-based home builder said its cancellation rate rose to 63% in the fourth quarter from 27% in the year-ago period, and from 42% in the third quarter.” As of 11:11am, the stock is up. Now if the cancellation rate had been 100%, that might have been bad and the price might have fallen a bit. NOT. At least not while the PPT is on duty.
http://tinyurl.com/yg5v5q
Anyone who considers gold a ‘barbarous relic’ should explain why suppressing gold is in the top 3 hit parade for the PPP.
Yes, that is a good question. I haven’t heard a good answer, though.
Subprime mortgages just got more expensive today. For most, resets are based on the LIBOR, and the BOE just raised their rates to 5.25%.
Aha! You mean today is the day the larger wave of resets begins? If so, the bust should REALLY start to get interesting.
BOE = Bank of England. Shouldn’t affect US lending rates, unless the Fed follows suite.
Winjr is right. Many ARM’s are tied to the LIBOR as their index. Many ARM’s will be affected here in the US.
–
LIBOR is not tied to BoE rate (eq. of our Fed Funds Rate). It is a $ based rate and is much more tied to the US short-term rates.
Jas
LIBOR stands for “London Inter-Bank Offered Rate.” It is based on rates that contributor banks in London offer each other for inter-bank deposits. From a bank’s perspective, deposits are simply funds that are loaned to them. So in effect, a LIBOR is a rate at which a fellow London bank can borrow money from other banks.
From:
http://www.moneycafe.com/library/libor.htm
Since the US must borrow so much money from international sources, it doesn’t suprise me to see our loans based on a European rate.
Neil
I swear I learn something new every time I read this blog. Sometimes obscure, but almost always relevant and useful, somehow.
It is my understanding that a lot of ARMS are tied to LIBOR.
LIBOR is the rate paid or offered by major banks for US-dollar denominated assets (or generally, outside the US). There are a variety of terms and currencies available, as well as forward contracts, but when someone says “LIBOR” she usually means “spot 3-month U$ LIBOR”.
What the BoE does affects USD LIBOR indirectly at best.
Oh you didn’t know? Markets are all interconnected. It will have an effect.
“It has also expressed concern about the continuing growth in the housing market”
http://www.housepricecrash.co.uk/forum/index.php?showtopic=40261
The nine-member Monetary Policy Committee increased the repurchase rate to a five-year high of 5.25 percent today, surprising all of the 52 economists in a Bloomberg survey.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aYDC_MdT9JaE&refer=home
“surprising all of the 52 economists”
Yep, that’s why it’s called a ‘SURPRISE’!
BWAHAHAHAHA! I LOVE surprises!
BTW, it looks as if ALL mortgages are getting more expensive today — The 10 yr. is getting sold off this morning, yield up 3 ticks.
Yep, winjr, here we go! It’s off to the races to the bottom.
yet UK prices rebounded from late 04 dip
hhhhhmmmmmm
yes, same story in some other EU countries. Mortgage rates are no longer relevant …
It’s because the 52 economist are having difficulty flipping their properties they recently bought !!!!!!
The BoE rate is for UK currency (pounds). LIBOR is for dollars - so-called “eurodollars” - and has no connection to the BoE.
I stand corrected.
oops, me too. I guess I just got a little TOO excited that the bust might speed up. Oh, well.
on another note, the ECB did not change their rates today and Trichet hints that they will pause in February as well. Because of strong political pressure, Trichet will probably not increase ECB rates as long as the FED is on hold.
It’s the French presidential elections. French economy is suffering hard, housing market is cooling fast(too fast?), GDP is turning negative.
But will it be enough to keep mortgage rates down, with massive bond sales coming up from several European countries
and companies. Will there be enough appetite for investors when yields are higher elsewhere.
problem is that differences between the EU economies (GDP growth, housing, etc.) are growing, and the unified interest rate makes it difficult to do something about things that are headed in the wrong direction. More talk about countries reserving the right to set their own rates (that would be the end of the euro, with some delay) or leaving the Euro currency.
euro down 1% after the ECB meeting, no surprise there; it’s just another day in the race to the fiat paper bottom.
UK should stay out of euro - france will have FREE housing soon
roflow !
Yeah UK is a great example of fiscal and budgetary discipline. I am joking. The UK is just a overrated balloon. Just remove the money from Africans dictators, Arabian sheiks, and Russian mafia, the whole place will ressemble to a deindustrialized “hole”. Sorry but the UK is a paper tigrer and nothing else.
Marc Authier,
The UK has elevated social parasitism as the organizing principle of society. The working-class stiffs and professionals have their modest wages taxed at confiscatory rates to pay for all the immigrants and asylum seekers, mostly from UK-hating Muslim nations, ex-colonies, or eastern Europe [esp. gypsies] flooding in. The perpetual class warfare system means Labor, like the Democrats in the US, has a vested interest in creating ever new and larger classes of entitlements for the Nanny State to provide. The criminal justice system is a joke, and any kind of work ethnic or community pride has long since been washed out of 99.9% of the post-WWII generations. The British are has-beens who still cling to delusions of [past, long dead] grandeur as they sink deeper into the mire every year.
What a great comment Mister Fleming ! Exactly. It’s not just the real estate that will implose. Watch the BOND MARKET! It will be really UGLY!
Nice domino effect in perspective. It will just accelerate the implosion of the subprime market. Very interesting stuff.
what do times shares resell for 30-40% in good times
In a severe recession, you can get great deals on really good time shares — people walk away from them and you can find good ones for nothing more than the $500 transfer fee. The trick is to research ahead of time, so you know what “great” is. A great week is essential, but so is a great resort. I’d imagine that, this time around, Craig’s List will be a good venue for advertising these.
Not entirely housing oriented, but…
Was skiing for a few days up @ Sierra Summit and thank goodness for snow making machines, as the Sierra Nevada has almost no snow and I just looked at the forecast for the next 10 days and one quick moving 1 day storm is supposed to pass through today, but that’s it.
In a year of goofy weather, it wouldn’t be out of the question for a year w/o a snowpack, in The Sierra Nevada.
The ramifications:
L.A. & S.F. rely heavily upon the snowmelt as their water source.
Actually that IS housing oriented. Where will the water come from for all the development in CA? AHnold says CA is like a city-state, implying CA could go it alone. That is, until the natives (and non-natives) get thirsty.
Some nuclear power plants and desalination plants could take care of that. Then ship the nuclear and salt waste to Nevada. Problem solved.
Still costs about a dollar a ton if you use seawater feed. (I happened to have a conversation a couple of years ago with someone whose team had prepared a quote here in Australia.)
That’s not too expensive for domestic use, but out of the question for agriculture and some industries.
And the most efficient processes don’t give you salt, but a concentrated (maybe 3x) brine in very large quantities.
It has been above freezing in the Maritimes (Canada) for most of the winter so far. Everything from the spring peepers to the sugar-bush is suffering.
John M,
where in the Maritimes are you? I have been watching the Nova Scotia market via a web site, Tradewinds.com. What do you see?
Here’s the short answer
http://housingdoom.com/2006/12/25/merry-christmas/
I’m on the Halifax Peninsula (far north, near NSIT). I don’t study the market, just been living in the place for over thirty years. Here are a few random anecdotes.
The water supply is high-quality and stable.
Rocky ground not suitable for agriculture, lots of land available to build in the burbs, but …
West and North commuter choke-points in/out of the peninsula completely maxed out: Bedford Highway, Armdale Rotary (plus flows up Quinpool, etc.)
East commuter choke-points: Par-Clo on the Circumferential & 7 bridge lanes - 4 in / 4 out (middle on old bridge switches at noon) have capacity for a few more years, then no immediate prospect of expanding.
Bayers Lake “Industrial” Park big box stores are sucking the life out of downtown retail and the old malls on the Halifax side; expect a repeat performance with new Dartmouth Crossing near Burnside in the near future.
Seems like half the population of the rural counties has moved to new high-rises in Clayton Park West (cul-de-sac SFHs went there in previous decades). Traffic from there and Bayers Lake has to go down-hill through old Clayton Park, and Bayview, etc. is hopelessly clogged with no improvement on the horizon.
Looking north up the Basin, there are cranes all over the place and huge ugly condo developments all up the western shore of the Basin near Bedford. Huge SFH McMansions started sprouting overlooking Highway 1 and the train tracks about 20 years ago. I don’t get to The Sackvilles very often, but there is likely continued fast expansion up the Beaverbank, etc., at least these guys can take Highway 7 and the New Bridge.
Condo towers are going up on the peninsula anywhere they can squeeze them, the old Rent-a-Wreck parking lot at Gottingen and Kaye, Gladstone Stores property (as pictured in link above), NE & NW (”The Lexington”, yeach!) corners of the Commons, SW corner and W side of the Gardens (shade and heritage be d****d).
Summary: the area’s been in recession since Confederation (1867); living conditions and ambience almost ideal (some weather issues
); economy mostly military, education, and public service; best port facilities in east coast North America, but limited rail lines exiting the province; some potential for energy offshore, but has not (yet) lived up to expectation; steady population influx from rest of NS, but this now about exhausted.
Outlook: boom/bust lower and slower than in the rest of North America - think East Coast Africa during the Asian Tsunami
A beautiful area though. My daughter graduated from the university there. Limited rail service is one thing I noticed when there.
All time record high temperature in Moscow was announced on the news last night. The average temperature for the past month has been about 20-30 degrees F above normal. Presently about 45 degrees F with no ice or snow on the ground.
Farmers are worried the lack of snow cover could damage crops if we get a sudden hard freeze.
Not only that, Popper, but I read somewhere that the permafrost is not so perma anymore and as it melts, it vents methane into the atmosphere, increasing the temperature. Any stories about that lately?
Now that you mention it there was a story about a year ago about some place in Siberia/Extreme North where the year round snow cover is receding. Supposedly if the snow cover recedes enough the dark colored peat bog underneath will be exposed which since dark colors absorb heat will accelerate the melting of the snow. The end game is that the peat bog will somehow spontaneously combust causing a bit of pollution. I think I heard somewhere that the peat bog in question is about the size of France.
Before you guys laugh this one off a couple of years ago a peat bog surrounding Moscow pulled a “self combust” and Moscow was basically smoked out for more than a month until temperatures cooled and we received substantial rain. One those peat bog fires start they are a bytch to put out!!
I do not believe that the peat will burst into flames. Generally, I would expect that there is just too much water around.
However, the real problem with bogs is the fact that they are good producers of methane gas. We are talking possible millions of tons per year. As a greenhouse gas, methane is some 20x as ‘effective’ as carbon dioxide, so it is easy to see why this could be a problem.
Uh, brian, I think Popper is from Russia (correct me if I’m wrong, Popper) and knows something about peat fires there.
For example, sometimes my friends up north don’t believe it when they hear of wildfires in Florida. They have this image that Florida is all wet and humid with lots of water everywhere. But we have wildfires during the dry spring season.
Brief article about the Moscow peat bog fires of 2002:
http://tinyurl.com/y5dmbw
The particulates from the fire will block sun and offset the warming to some degree.
What a shame they can’t make scotch whiskey with the peat. Reminds me of Scandinavia, where some country (Finland, Norway?) is complaining that king crabs are clogging up the entrance to the fjords and threatening marine life there. Why aren’t crab fisherman rushing over there to help them out? I’ll do my part, if the price per pound is reasonable.
We are having the same problem in Québec. It’s a real problem. Snow acts like a reservoir. When the springtime comes, it irrigates the soil. We had ZERO snow this year. I think you can expect very bad crops in many countries in 2007. El Nino plus global warming will affect particularly Australia and India too.
Holy crap! We’ve had no snow in Pennsylvania, but no snow in QUEBEC yet??? That’s amazing.
In Southern Québec more exactly. The North has snow but in snow cover is very small. Yeah it’s really weird. In 1971 we had 5 feet of snow in Montréal. Now ZERO. It snows and 24 hours after that, it’s all melted and gone. Last saturday the temperature was 17 celsius.
january temperatures in Netherlands also at an alltime record (at least for the last four centuries); spring is starting everywhere you look. With another 10-20 years like this, the Netherlands will be the European Riviera (and Spain and Italy will look like the Sahara), so Dutch home prices should be able to stay on a permanently high plateau. Come to think of it, there could be even more coastline and less homes to choose from in 10-20 years because of all the flooding, so fundamentals are as bullish as can be
Just looked at the local forecast for Tulare & San Joaquin Valleys, where a heckova lot of citrus is grown and the next few days will be grim for the industry, as lows will be around 20 degrees for a sustained 3 or 4 days, which will ruin the crop, about a $10 Billion loss, for all involved.
This will only add to the woes of much of the Central California real estate market, as citrus is a big financial element of the area~
Hope your dikes resist the elevation of the oceans because of the melting of the ice at the poles ?
no chance, but our politicians have chosen to ignore the risk.
aladinsane, I think your comment is related to housing. I have never been able to understand why people keep front lawns in LA. All that water used just for “decorative” purposes. If people kept just desert gardens in the front an only watered the lawn in the backyard, think of how much water could be saved without affecting people’s lives or pockets. It all goes back to the state of denial that a population can withstand. Angelenos can withstand a lot of it. There is denial about the housing situation, denial about the possible water shortages and so much more. It’s mind boggling.
If there is no snowpack this year, L.A. still has 2 other sources of water, (Feather River and Colorado Rivers) but with water being so scarce already in the Southwest, we might see a good old fashioned water war, ala Jake Gittes, in Chinatown, but update it and make the stakes as high as they can get, the liveability of some 30 million people being at risk…
According to Campion Walsh in today’s WSJ, “…the NAR said sales of existing homes are likely to decline about 1.2% this year to 6.42 million, following a sharp drop last year, while sales of new homes are seen falling about 9.7% to 957,000.”
Walsh adds, “the group forecasts the median sales price for existing homes to grow 1.5% nationally to $225,300, following last year’s estimated 1.1% rise. The national median price for new homes will increase 3% this year to $248,900, according to the NAR, after estimated growth of 0.3% last year.”
I was under the impression sales will increase or steady this year as a result of significant price cuts. Does the NAR have these numbers right OR are am I missing something?
The national numbers have very little relevancy to what happens in individual markets where there is always variation. Where you’re hot you’re hot. Where you’re not you’re not.
I don’t think every market being local is as true as it once was.
Why? The nationalization of the mortgage market. Before regional banks supported regional home sales.
This isn’t to say Detroit won’t be independent of Miami. But defaults in both locations are going to hammer the OC.
Neil
No. It’s baloney.
One of our informants has pretty much established that foreclosures get counted as “sales” by Dataquick in CA. It seems that the “sale price” of these doesn’t flow through to the “comps”, although this is a bit less clear. Looks like yet another complication in the already hard business of interpreting RE statistics.
“Dataquick Appears to Overstate California Sales”, by twist, HousingDoom blog, January 11, 2006.
http://tinyurl.com/yf7pv5
Given that home purchases are typically the biggest purchases most people ever make, this is criminal. Where are the MSM muckrakers on this one?
If this is true and doesn’t become a big story, something is seriously wrong.
Actually the biggest purchase most people make is government, paying something approaching 50% or more of their gross income, year after year after year forever
Ronin — amen to that.
And for what ? Seing real rich people hide their money in Switzerland, the British Isles, the Carabean Islands. The truth is that it would much less than 50% if the people in Washington (like that SOB Paulson) paid their taxes and their income taxe. You just can’t imagine how much of these bastards like Paulson and Rubin hide their fortune in these filthy places just set for them. It’s the same people that say to you to pay your income tax and shut up.
I received that email also, has you been able to confirm this story? I emailed DQ and a few news outlets (including Ben) and they all ignored me…
Dataquick is just another part of the REIC propaganda machine.
Indeed. Every single dollar supporting these leeches on the humongous REIC beast ultimately out of the pockets of RE buyers. On another blog an REIC shill questioned where funding for OpenMLS would come from. Hell, where does it come from NOW? Every MLS, every analyst, realtor, mtg broker, appraiser, and every data repository like Dataquick is ultimately supported by money being paid out by the buyers.
WOW expect ’sales’ to skyrocket next year.
‘It seems that the “sale price” of these doesn’t flow through to the “comps”, although this is a bit less clear.’
It is quite clear that this would help explain why “real estate always goes up” (at least according to the cooked data).
In another story in today’s WSJ, Rafael Gerena-Morales reports homelessness is up in Hawaii as a result of the housing boom. She adds prices and rents are beyond reach for most families and the government housing authority is overwhelmed; consequently, residents are pitching tents on Hawaii’s tourist beaches.
If we housing bears don’t buy now, are we going to get priced out and become part of the growing homeless? Do you know where you are going to pitch your tent?
“She adds prices and rents are beyond reach for most families and the government housing authority is overwhelmed; consequently, residents are pitching tents on Hawaii’s tourist beaches.”
On Maui, the favorite homeless beach is Oluwalu, which is a beautiful stretch of sand (but a bit shark infested), with drop-dead gorgeous views of the West Maui mountains. Whenever I drive by and look at the tents I think “Man, I kinda wish I was homeless”.
Yep, winjr, that’s how Hawaiians used to live and it was good enuf for them back in the day. They already had paradise, while the “industrious” mainlanders labor to pay their mortgages, utility bills, credit card debts, educational loans, car payments, etc. I guess we showed those “backward islanders” the benefits of civilization, eh?
LOL! We sure did. And in return we stole their land, as well.
Ya know, as idyllic as their existence may have appeared, these guys were actually brutal in the “ancient” days. Stupid stuff, like being in the water at the same time as an Elder, or crossing your shadow with that of an Elder, was punishable by death. And this way of life wasn’t really all that long ago - up to the 1700’s, before the missionaries arrived.
By the stories I hear from a friend in Hawaii, things haven’t really improved on the part of the tribals.
While you won’t read about it in the MSM, there is a large and growing undercurrent of hostility among native-born Hawaiians toward the mainlanders and “investors” who dominate the economy and have driven prices out of reach for the typical native (who generally aren’t particularly industrious or skilled, and thus don’t earn very much). There is a small, vocal, but growing “nativist” movement in HI that is stirring up animosity toward the “settlers.” When you see the native families living three and four generations under one small roof, side by side with DINK mainlanders or vacant “investment” properties, you can see the seeds of future trouble. It looked to me like a lot of young native Hawaiians were also getting into the “gangster rap” culture, with its “It’s all out there for me to steal” mentality. The demographic divide is going to get a lot more acute, IMHO, as HI’s economy goes South.
“While you won’t read about it in the MSM, there is a large and growing undercurrent of hostility among native-born Hawaiians toward the mainlanders and “investors” who dominate the economy and have driven prices out of reach for the typical native (who generally aren’t particularly industrious or skilled, and thus don’t earn very much).”
Who can blame them? After reading James Michener’s “Hawaii”, I came to realize that these islanders had it made in the shade (or the sun, if you prefer). They lived happily and well with their environment and enjoyed life. Until the “settlers” came, along with missionaries. Being “industrious and skilled” were artificial virtues forced on them by an industrial, polluting culture. So what if they take their land and their culture back? Who really stole what from who? Why be industrious to increase the bottom line of some hedge fund, if you can swim and surf and fish and live off the land? Oh, yeah, they also didn’t have much disease until the “industrious and virtuous” New Englanders brought them.
I read “Hawaii” a number of years ago. I might give it another read this weekend if I can hunt it down.
You must be a fast reader.
I might re-read it myself. As I was reading Sammy’s post, it just struck me how the latter day Hawaiians were truly rich. Every day, they had in their environment what Joe Sixpack struggles and sweats and strains to earn in order to experience a week or two on some cruise.
Most Hawaiians today are of Asian ancestry (Filipino, Chinese). But of course, everything is still the whites’ fault (not).
The native Hawaiian culture would have been able to handle any population increase, and would have ended up like Easter Island.
Now their socialism will bankrupt them all, and deservedly so.
It’s not part of Japan ?
….would NOT have been able to handle any population increase……sorry.
Interesting observation Sammy…..I am a semi-adopted son of a very large Hawaiian family…Just attended papa’s funeral yesterday so your post is timely for me since I spent the entire day with extended Hawaiian family….
Revisionist history romanticizing the past and the simpler “idyllic” life of native peoples. If you want a balanced view, read “The Ecological Indian” (University of Arizona Press) - while not directly discussing Hawiaans, it shows in an academically thorough way that native peoples, along with having some traits we value as being environmentally aware, were in general every bit as money hungry and treacherous as European settlers (they just lacked the technology to be really good at being money hungry and treacherous.) Unfortunately, many natives, whether islanders or native americans, have also embraced this idealized history of their past that never existed.
That is the same thing many Mexican immigrants do…idolize their quaint lifestyle back in their tranquillo villages and wait to go back later in life. They seem to forget about how sucky it really was and why they came to the U.S. in the first place.
Large and growing? ha ha, it’s been there since the queen was deposed, but the Hawaiians kept out of places like Honalulu most of the time. Now even those places are getting over run with tourists. I’m sure glad I soaked up memories while it was still paradise.
I live in Hilo currently and see things a bit differently. There are Hawaiian (self explanitory), Locals (any asian descent not FOB) and Hoales (whites/blacks/arab/indian); if you are hoale and marry or are a child of the Hawaiian or Local you assume that groups identity. I find the class structure here goes something like this: japanese, japanese/white, white, chinese/white, chinese, other asian groups, hawaiians then filipinos. I am a Scot (fair skin, dark hair, strange customs) the wife is a very fair filipina raised in europe, because of her we (my son and I) are considered locals. I havent found anywhere here I couldn’t go. Sure there may be some young toughs but the older people almost immediately knock them off their pillar. Its quite strange that the schools and most govt jobs are controlled by japanese. When the wife was hired by the DOE, they thought she as japanese and were stunned to find out she was filipino. Don’t really see the undercurrent of hatred towards hoales or any other group except any one new, its always the last guy that left the door open and spoiled everything.
I think the problem we are seeing in Hawaii is people paying for they crimes. Here no one cares about education, if you learn to read great. Even in the K school most those kids dont amount to much because no one cares especially parents. A friend that works at UH say maybe 10% are going to college and even fewer are ready for it, and K school kids are in the same boat. People are pissed because the infrastructure built by the fed govt in the 50s is failing today, heck nothing was done to care or fixe it in 50 years. I can start my own junkyard next to your 2M house you cant don anything about it and the govt wont help. If you are even a descent worker with a small amount of gumption you will do great here, because most see themselves a doing the employer a favor for showing up, and people wonder why the govt here is so big and doesn’t work. Paradise was fine when I came here, you broke it ,you should have to fix it. Heck where else in the US could you go shishi by the curb (adult or child) and no one cares.
But you gotta love the weather and the surf.
is shishi #1 or #2?
“But you gotta love the weather and the surf.”
Chuckle. Zimbabwe has wonderful weather, year-round, and Durban, South Africa has wonderful surf most of the year. Immigration to both places is about zero, I believe.
“…along with missionaries.”
This is the real issue.
“When you see the native families living three and four generations under one small roof….”
The article describes a gentleman with wife and two children who lived with his mother until she asked him to leave. As a result, they lived on the beach for a couple months until they found shelter. With many vacant specuhomes, I agree, there might be some kinda revolt brewing.
I have lived on Oahu, and because of the …nuances…of South Pacific indigenous cultural behavior, there has always been violence toward the haoles. I mean, there are parts of the island you do NOT want to be after dark. Hopi’s may be pissed off about leaving on a reservation in AZ, but they don’t go around slitting tourist’s throats. It’s very different mentality in HI, one that has persisted for 150 years. Add the current “gangster rap” stuff you mention, SS, and I can see some very serious issues on Paradise Island.
Catherine,
Where were you? My family visited Makaha all the time growing up and found that historically if you were cool most of the locals were too. Too bad it’s almost completely over run with the annoying kinds of haoles now.
I was supposed to be in class at UofH…but usually I was on the North Shore, doing my best imitation of a surfer groupie. And the usual beach for nighttime tourist violence was Ewa beach area. Makaha was dicey, but you’re right about being “cool” with the locals…however, if you were just naive and in the wrong place, things could get bad.
The worst people I ran into on the North Shore were young military guys, especially Navy or Marines. Ignorant plus belligerent and invariably half-drunk is a bad combination. I personally never had any problems with the native Hawaiians.
And it’s on Oahu where the haoles are the MOST tolerated. Anybody else, even though not natives, are ok — the japanese, chinese, portugese, koreans. Haole, though, is a no-go.
Try spending time on Moloka’i, the so-called “friendly” isle. Every look you get makes you feel as if your throat has been slit.
Geez — I guess all this is not racist, because whites aren’t the ones pounding on someone else?
Sammy you must be a surfer in Colorado.
Travelling Surfers are either acutely aware of this dynamic or become acutely aware of this dynamic on their way to the hospital.
Sammy don’t surf (LOL). Skiing is my thing. Have friends in HI that I visited last year.
Or a straw hut.
Florida Exodus
GREAT article. If a Florida exodus was ever in doubt, here’s the hard facts. Van lines statistics speak louder than FAR BS.
I’m still trying to get my buddy down there to cut his price and bail while he still can. Amazing stubbornness.
txchick, no good deed goes unpunished. I think Floridian RE owners have to be the MOST stubborn in the US.
txchick, folks like your buddy won’t say uncle even if we get another four hurricanes, the energy grid shuts down, etc. They will be wandering around with sweaty sunburns, panting in the heat and extolling the virtues of Florida’s weather and real estate.
There is still mass denial here.
Exactly, ft. lauderdale. The depth of the denial is staggering.
He’s in a small town in Broward County which is counting on a “downtown square” like the one in Hollywood that bellied up to reinflate values. I can barely even discuss it with him anymore.
Mass denial is a term that can be applied to a lot of areas right now — wonder what it will take to break it down? I mean, how long can a stand-off continue? Who will blink first and when will it be?
Raise the price substantially, then offer it back as cash for *repairs* …plenty of crooks out there that’ll bite on it.
The quicker we nail this coffin shut on the shady lenders, the better IMO.
A 1000 people a day are moving to Florida a 1000 a day so they say. Freakin liars.
Updated Census figures in the coming years should be interesting.
i have an uncle that did a double whammy. leveraged his house in key largo, which went from $400K to $1.2 in four years; bought a spec in fort myers for $650k. current status- owes $900k on key largo (will probably sell around $650k) and $550 k on the spec while comps are selling in the $400’s. ouch.
He will be ok when we have the spring rebound.
maybe some bales of pot will wash up near his house and he can sell those
Numbers can mislead also - my cousin years ago had a moving business and in concentrated area’s of seniors - when they pass away - the moving companies are often hired to move the furniture to family or relatives outside of state…the numbers could be really misleading…just like the Nar telling us that all is well in the housing sector….
Either way, whether one passes away or moves away, it is one less in the population count.
True — head first or feet first. No real difference to the county tax assessor.
Excellent point Dirty…..
“Numbers can mislead also - my cousin years ago had a moving business and in concentrated area’s of seniors - when they pass away - the moving companies are often hired to move the furniture to family or relatives outside of state…”
I’ve helped administer hundreds of estates, and it’s only been a small handful of instances in which the family wanted to keep the furniture — 95% of the time, the furniture gets sold, instead.
This moving company analysis reinforces what we see here daily in Greenville, SC. At the kids’ elementary school (which is over student capacity this year) during dropoff, we see dozens of FL plates on cars in line. It’s an easy way to identify recent transplants because the SC vehicle tax is about 2.75% of the car value annually so tax cheaters don’t change over their plates like they should. Many of these FL transplant appear to be poor folks by the condition of their vehicles by the way…
I was at a church fellowship last week in Lakeland and I heard 4 different conversations that incompassed a large number of people talking about leaving Florida because of the costs. And may of the people were either natives, or had been here most of their lives.
25 Markets to Watch
By Camilla McLaughlin
Individually, each of these markets gives us a reason to take notice. Collectively, they will indicate where luxury real estate is going. We’re watching. Are you?
1. Annapolis, Md. Boaters gravitate to this historic city on the Chesapeake Bay, as do buyers seeking quality of life in a town reminiscent of Williamsburg. Affordable prices compared to Washington’s luxury enclaves and a reasonable commute to both Washington and Baltimore make this waterfront gem highly desirable.
2. Asheville, N.C. A perennial on lists of great places, Asheville continues to draw upscale buyers looking for a low-key, outdoorsy lifestyle. The city’s eclectic ambiance, which fosters folk arts, great restaurants and lots of entertainment, adds to the allure.
3. Aspen, Colo. The fire hasn’t gone out of this market. No longer just a ski enclave, Aspen has four-season appeal and a reputation as a platinum location. Restrictive zoning and growth policies restrain supply, so don’t expect a property explosion or bloated inventories here.
4. Atlanta, Ga. No bubble worries here with respectable, not astronomical, appreciation. Luxury still lives in Buckhead, where the teardown trend continues. New upscale communities with lots of lifestyle amenities, city retreats and waterfront on nearby Lake Lanier continue to sell, fetching top dollar.
5. Austin, Texas Lots of untapped potential for luxury exits in this Texas hill country city, which posted record gains for much of 2006. The University of Texas, two lakes, and the bragging rights to the “music capitol of the world” bring a mix of newcomers.
6. Bellevue/Medina, Wash. A latecomer in appreciation compared to other areas of the country, prices here continue to escalate with 28-percent appreciation in some upscale neighborhoods in 2006. Mid-year sales volume is off, but expectations are that any slowdown will be short lived.
7. Beverly Hills, Calif. The luster of this platinum location remains untarnished as does its reputation as a Mecca for luxury, thanks to strong demand from global buyers seeking one-of-a-kind properties. Slower sales translate into more choices for buyers in some prized Westside enclaves. Particularly hot: Hollywood Hills.
8. Idaho This state is a luxury newcomer in the Pacific Northwest with growing resort markets in Coeur d’Alene, McCall and Sandpoint. Sandpoint even had to expand the airport to accommodate the increase in corporate and private jets. Boise ranks second among U. S. metros for price appreciation.
9. Jupiter, Fla. Luxury reached new heights on this exclusive island with Tiger Woods’ purchase of a 10-acre, $38 million estate. Prices continue to climb as a result of this benchmark.
10. Manhattan Uptown, downtown, midtown: luxury markets abound. Wall Streeters flush with bonuses in 2006 resulted in record sales of more than $5 million. Most desired are cooperatives and town houses. The peak is past, but local brokers attribute the slowdown to buyers sitting on the sidelines. Still, a growing number of homes on the market, realistic pricing and a robust economy should tempt buyers in 2007.
11. Miami, Fla. One of the country’s most international cities, Miami’s appeal still sizzles even if real estate is on a slow burn. Still hot is demand for single-family homes on the water, particularly in the ultra high end. Condo sales are off and inventories are high, which makes this a buyer’s market to watch.
12. Nashville, Tenn. There is a new song here. America’s country music capital is also the top-ranked city for business relocation. Insurance, book publishing and manufacturing bring newcomers. With the increase in sales volume exceeding price appreciation, and a positive economic outlook, the beat should go on in 2007.
13. Newport, R.I. No other place has a comparable luxury pedigree. Last year’s white hot market has mellowed but upscale sales still keep pace. Affordability compared to the Hamptons, Nantucket and Martha’s Vineyard is the big draw. A bonus: steady growth in affluent residents statewide.
14. Palo Alto, Calif. Memories of the dot-com bust resurfaced when Bay Area prices dropped in September, but experts say fundamentals are strong. With prices down by more than 10 percent here, this is a market for buyers to watch in 2007.
15. Panama Maybe still a glimmer on the resort horizon, Panama is getting lots of attention from potential expats and developers. Dynamic terrain ranges from jungle to beach. The widening of the canal is generating lots of interest from investors.
16. Philadelphia, Pa. Small neighborhoods, big city panache and a city center undergoing a renaissance woo empty nesters, dual income professionals, even commuters. Prices have risen solidly, but luxury homes are still less expensive than nearby Washington, D.C., and New York.
17. Provence, France History, charm, and anonymity bring celebrities, sports figures, and corporate leaders who readily pay a premium for villas and chateaus unattainable in the U. S. The opportunity to be part of the community without turning heads or the paparazzi? Priceless.
18. Puerto Vallarta, Mexico Buying in Mexico is easier than ever. Great values, low ownership costs, a community with an array of services and a location that hugs the Bay of Banderas attract buyers. Also giving a nod are American firms from Four Seasons to the Michael Graves Design Group.
19. San Antonio, Texas No bubbles here even though sales have exploded. No longer just a military/tourist town, San Antonio draws out-of-state and out-of-country buyers. Bio-medical is the top industry. A beautiful climate and luxury that begins around $500,000 also attract equity-rich retirees.
20. San Diego, Calif. Sales are off dramatically but the biggest adjustments are for new construction. Single-family resale prices were off 3 percent from the prior year. As prices correct, look for buyers to come off the sidelines and return to the market.
21. Sanibel Captiva, Fla. The best news for Florida real estate this year came from the weather. Sales might be off, but as the season in the Sunshine State gets underway some locals say a hurricane-free 2006 has things perking up here and in Ft. Myers.
22. Savannah, Ga. A lifestyle that hints of a bygone era combined with a lively arts scene (thanks to one of the largest art schools in the country) brings newcomers. Fetching highest prices are waterfront plantations, gated communities and historic neighborhoods. Once confined to the city’s original historic district, the luxury market now extends to several landmark areas.
23. Sedona, Ariz. Luxury lives in Sedona where there is strong demand for properties priced at $1 million and up. Upscale sales in 2006 exceed 2005, with those of more than $2 million almost doubling. Retirees, pre-retirement boomers looking for second, third or even fourth homes, and telecommuters gravitate here.
24. St. Thomas, U. S. Virgin Islands Boating, snorkeling, all the waterfront delights are here. Most owners willingly pay a premium for a home here in exchange for privacy and the charm of the islands as well as the security of still being in the U.S.
25. Woodstock, Vt. Rolling green hills, ponds, river frontage and a “quintessential New England village” make for an understated luxury perennial. Some of the best skiing in the east is nearby as is Hanover, N.H., and Dartmouth College. One million dollars buys an upscale home and acreage here.
http://www.uniquehomes.com/cms/1206_25markets.html
What a crock of shit pandering to the people for whom there is already 10-20 properties built for every one of them.
Couldn’t have said it better myself.
That’s EXACTLY the problem with this market: there are too many choices at every price point.
philly - like balimer md only mush more gritty
and the whole state of ID is luxurious?
roflow
The term “gritty” is actually kind when describing certain Philadelphia neighborhoods, the Badlands come to mind…
But this article addresses luxury housing, and it’s here alright:
Society Hill, RIttenhouse Square, Delancey Place, Fairmount, Chestnut Hill…not to mention the ultra posh Main Line locales.
(Gladwyne, Villanova, Radnor, etc).
Is the high-end market cheaper relative to NYC and DC? Yes.
And unless we see significant influx of new inhabitants from those cities the high-end condo prices (800k-1M+) will take a hit .
It sounds like you haven’t visited in a while, Flat. And if you have, maybe you were staying around Temple U or thereabouts?
Philly lacks NY’s vibrancy but it has everything you need in a city without some of NY’s headaches. And yes, it’s more affordable. What you find a lot of is dual income families where one spouse works in Philly and the other in NYC or in the NJ portion of the NYC area. Dual incomes like that have far more buying power in Philadelphia than NY.
As long as you are in a good area, Philly is OK.
NYers who landed here after the WTC attacks were responsible in part for the “renaissance” the article mentions. They came, they saw, they invested. In comparison to NYC, Philadelphia RE prices were at fire sale level. Friends of mine who used to attend the city’s sheriff sales reported the appearance of NYers starting around 2002. To the extent that they could “manhattanize” center city, they did. This town needed their juice.
“16. Philadelphia, Pa. Small neighborhoods, big city panache and a city center undergoing a renaissance woo empty nesters, dual income professionals, even commuters. Prices have risen solidly, but luxury homes are still less expensive than nearby Washington, D.C., and New York.”
NO! NO! NO!
I grew up in NY and have lived in Philly for 20 years. I’ve spent half my life in each city.
I’m sick and tired of hearing the above price comparison to NY and DC. There is a very good reason why Philly RE is cheaper than NY: Philly is still a second-rate city compared to NYC.
Don’t get me wrong. Philly has come a long way in the past seven years, with people from other cities moving here all the time. I enjoy living here, mainly because I can own a nice home for what I could buy a studio apartment in Manhattan. That said, comparing Philly to NY is laughable. I won’t waste anyones time here with the obvious reasons why.
What’s amazing is that the Philly RE agents ALWAYS compare prices to NY. Their logic is completely retarded because their position is based on the premise that there is no difference — aside from RE prices — between the two cities. They forget that aside from the allure of NYC, the economic opportunities are far greater in NYC than in Philly.
Predictably, Philly is now completely overbuilt. For example, Toll Bros recently dropped its prices at their Naval Square development in Philly by 25%. Many of the FB who bought there in 2005 are now trying to find renters. They paid $350K for units that they can only rent out for $1200/month, tops. Even the Toll Bros. sales office is helping those FB’s to find renters in order to prevent forclosures on the units.
The over-building is mind-boggling here. Even the lower-class and working-class neighborhoods have a ton of new contruction/rehabs — all hitting the market this spring and summer.
Bottom line: Philly’s a great town, but it’s no New York. And it’s a bubble here, too.
I was near the museums- but on every corner there was a bum eating a chckenwing sandwich
That was no bum - that was my husband!
LOL
got a friend with an empty condo for sale in philly (no bites), going on a year…plans to sell it in the……….SPRING!
tell friend if he wants a house-sitter to keep condo from getting too lonely, I’ll do it…for a slight fee
Pass the popcorn and just sit and watch as the GFs glom onto these money drain magnets. I just ordered another $2000 worth of Three month T-bills.
Why don’t you just open a blog and publish your financial statement?
Here it is Fred. … Now where is my address? Please tell me. What is my social security number? If you can find that info from this blog, I will shut up.
I think Fred was referencing the Internet’s most prized buffoon, Casey Serin…
http://iamfacingforeclosure.com/131/liabilities-spreadsheet/
Serin in french is a bird. Serin is a bird brain and a sick puppy. This guy is maniaco-depressive. 8 properties in 8 months with no cash ? And bankers are stupid S.O.B. too and dumb morons and as crazy as Serin.
Filthadelphia…woos empty nesters, dual income professionals, even commuters…
But forget it if you are single - nothing affordable to you.
Prices have risen solidly…
But no bubble here! We’re different.
Please.
(P.S. This is the area I live in so I can slam it.)
“Filthadelphia” -
haven’t heard that one since the Divine Miss M was on tour.
Is it really that bad where you are, eastcoaster?
I’m a single mom and priced out completely. Even out of townhomes.
And…I’m tired of hearing how prices are so expensive because of how fabulous the area is. Urban sprawl is running rampant out here. If a decaying suburban area = fabulous then I’d hate to see what people define as a bad area.
Check out this site: (national city corp)
http://tinyurl.com/yj5a4d
Click on the link at bottom titled Q3 2006 dataset. You’ll see that the Philadelphia area is about 20% overvalued - well as of Sep 2006 it was. This chart pretty accurately reflects what happened in the Philadelphia market. Undervalued pre-2000, achieved equilibrium on the cusp of 2003, and then all hell broke loose.
On the fringes, prices are already starting to slide. Have you been tracking listings on CL? I don’t know what your price range is, but some nice affordable areas are already reflecting, ahem, correcting price.
There’s going to be a lot of opportunity beginning Sep-Oct this year.
Hang in there!
on the smelloware
#19. San Antonio…..beautiful climate?????? She MUST be referring to some other San Antonio in some other universe. What a crock!
I didn’t see the link at first and wondered what the hell I was reading as I got further into the article. Very funny stuff, really. A bit like reading one of those teenager magazines which feature world leaders, like Brittany Spears and financial advisors like Charlie Sheen and what’s going on in their lives. “Brittany Spears has just bought a 50 room house in Aspen. She said she needed somewhere to keep her doll collection.”
That article is pure Showbiz Fluff. That writer should see if she can get a job on Entertainment Tonite. That would best suit her style.
so much for the 1000’s moving to florida
For the first time in 30 years, United Van Lines Inc. says it moved more people out of Florida than in, and analysts see that as a sign that consumers are looking elsewhere for a cheaper slice of life.
Moving from market to market to escape a high cost of living lowers prices in the source markets (Florida) and exerts pressure the other way in the destination markets. It’s called the Linoleum Effect - the bubble doesn’t go away, it just moves somewhere else.
“Linoleum Effect ” That’s a keeper. Thanks
drentzel
Good one.
As I posted above - cousin owned a moving business in Florida years ago - a big chunck of business comes in waves - seniors who pass away have their furniture shipped often out of state to family and relatives…so don’t take much stock to those numbers….a growing population of seniors will surely create what appears an exodus by shipping numbers…..
Well, they’ve still left Florida, no?
good and interesting point, I do put more stock into the fact that broward county actually had a reduction in the number of students this year for the first time ever.
The key point in United Van Lines’ data is that THE TREND HAS CHANGED. For the first time in 30 YEARS they see outgoing more than incoming. Something new is happening. Something has changed. Guess what it is? Or are you going to have to check with your cousin first?
Housing bubble update from the Netherlands:
according to the largest Dutch realtor organisation, home prices are still rising (last quarter of 2006 prices were up 4% from previous year, sales numbers up 10%). These statistics are manipulated to the extreme, but it agrees more-or-less with the official ‘Kadaster’ numbers that also still show (slightly) rising homeprices. The realtors expect Dutch home prices to keep rising despite higher mortgage rates, at least +5% in 2007 (of course …).
On another note, the move to the left at the november elections in Netherlands will probably have no impact on the housing bubble. The new center-right government that is being negotiated will make at most some cosmetic changes to the extremely favourable Dutch HMD regulations. The Dutch labour party wants to cap the HMD at 42% for new buyers (instead of 50% for higher incomes). However, the slightly smaller HMD rate for new buyers (= more income for tax office) will then be used to subsidize first home buyers under 35 by removing the ‘transfer tax’ for them. An extremely stupid initiative if you ask me, which will only worsen the housing bubble (but of course that is what all Dutch politicians are after).
There are also some ‘innovative’ bubble ideas in development, like the government buying the land for starter homes (can be more than half the price), so the first buyers only have to pay for construction. Again this is supposed to be a ‘free put option’ where owners can choose to aquire the land (when they think it is favourable for them to do so) but don’t have any risk if land prices decline (whatever happens, the tax payer will get the bill).
The only possible problem for the housing mob might be the new lending rules for mortgages (for starters in the housing market) that make it more difficult to use high leverage (like more than 6x income). But I have not heard anything about that in the last two weeks, probably the mob already found a way around that.
how could neth move farther left- wouldn’t that put them in the ocean
It’s the North Sea, flatffplan. And whatever direction they move, they always will have their feet under water and their heads in the sky.
Just kidding, nhz.
Yeah, but remember they DO “make more land”
hey, it’s an oldie, but somebody had to say it.
yes they DO (or DID, more accurate), but that won’t help much when the North Sea level rises 0.5-1 meter in the next 25 years or so. But who knows, if home prices keep rising at 10-20% yoy like in the last 15 years, Dutch homeowners will have tons of equity to spend on improving the dikes, that should do to keep the mortgages above water
This is awful, but I’ll drag it out anyway — an ancient response: “Pass the butter, mother, I smell corn.”
(NHZ — colloquial, as in, corny humor)
P.S.: average Dutch home price is now EUR 241.000, that’s about 8x median income …
Amazing. It looks like the Dutch politicians could move to the US (ie, DC) and feel very much at home.
Lots going on today — surprise Bank of England rate hike … a new study on just how unaffordable homes still are here in the U.S. … and a stunning cancellation rate reported by one smaller home builder. Full details at my blog, if you’re interested:
http://interestrateroundup.blogspot.com
Excellent, Mike, thanks for the news. That cancellation rate is interesting.
Thanks, Mike.
Pass the barf bag. Susan Bies: “…the recent easing of traditional underwriting controls and the sale of some types of nontraditional products to subprime borrowers may generate losses on these products greater than has been observed in the past.”
“MAY” generate (greater losses)? I will bet 100-to-1 that it is WILL generate.
I hate bureaucrap-ese. She had a chance to score, and blew it with her pap wimpy modifier. Susan: the market is crewed because of these products. Deal with it. You’re in charge of a lot that will affect our lives. We didn’t elect you. Why not try to make us think that we would have elected you, if we could have had the vote?
2004 and 2005 Mortgage Vintages: in Peril?
http://wallstreetexaminer.com/blogs/winter/?p=301
Awesome work, per usual.
Good grief.
How do you think the credit insurance scenarios will play out, russ?
I’ve had wine that followed an almost identical path. Spectacular after release, with lots of promise, but even after fastidious storage it declined rapidly in far fewer years than it should have.
Melody — if you’re still following the blog — you probably can tell the same story. Miss your posts.
I don’t know why people would leave NJ.
(From United Van Lines annual migration study http://tinyurl.com/create.php)
MICH 66.00%
ND 66.00%
NJ 60.90%
NY 59.50%
INDI 58.20%
PENN 57.00%
LOUI 56.40%
OHIO 55.80%
ILLI 55.70%
MARY 54.10%
MASS 54.00%
CALI 53.90%
WISC 53.20%
CONN 52.40%
MAIN 51.90%
MISS 51.80%
FLOR 51.20%
RI 50.70%
NH 50.30%
OKLA 50.00%
MISS 49.90%
KANS 49.50%
VIRG 48.80%
MINN 48.70%
WASH 48.40%
ARKA 48.30%
WV 47.60%
NEBR 47.50%
KENT 47.10%
VERM 46.70%
GEOR 46.10%
WYOM 45.60%
DELA 45.50%
TEXA 45.40%
COLO 45.30%
IOWA 45.10%
MONT 45.00%
ARIZ 44.60%
TENN 44.20%
SD 44.10%
UTAH 44.00%
ALAB 42.50%
DC 42.10%
NM 42.10%
IDAH 40.70%
NEVA 40.10%
SC 39.40%
OREG 37.50%
NC 36.00%
Palisades — in TinyURL (good that you use it), when you see the screen that says, “Tiny URL was created!”, the second bold line contains the new URL. That is the “link” that you should copy and paste here.
There has been some confusion since TinyURL added, in 2006, the “preview” link. I don;t know why they did that,or its value, but you should copy only the second (middle) bold link and past it in your post.
Recommend you re-do yours now, if possible, as we cannot get to your source article from the invalid link that you included. No sweat — we all screw up in the beginning, or after cocktails.
Ooops - here you gp. Sorry.
http://tinyurl.com/y8ryvg
Why the BOE’s Rate Rise Matters
By Tony Crescenzi
RealMoney.com Contributor
1/11/2007 9:43 AM EST
Click here for more stories by Tony Crescenzi
I do not believe in the notion of concerted central bank activity, but I do believe the central banks think alike, which is what gives a modicum of weight to the idea that the Bank of England’s rate rise is of importance outside of England. Worldwide, central bankers recognize that global liquidity is plentiful, giving cause to lean on the side of tighter monetary policy.
1. UBS Sees Cisco Surging
2. Apple Shines on iPhone
3. Level 3 Will Ride Virtuous Cycle
4. Cramer’s Wall St. Confidential: Not Trusting Energy
5. Cramer’s Wall St. Confidential: Oil Might Be Well
Probably the most important aspect of the Bank of England’s interest rate increase is the competition it creates for other interest rate markets, including the U.S. In both the U.S. and England, official rates now stand at 5.25%, but expectations are that the Bank of England might raise interest rates one more time this year, standing in sharp contrast to expectations in the U.S., where expectations are for as many as two quarter-point cuts. As a result, global investors could earn more by investing in London where 2-year U.K. Gilts yield 5.42%, 68 basis points more than 2-year Treasuries.
The British pound hence seems likely to continue to gain in 2007, helped by the infusion of capital there. Data from the Bank for International Settlements show that worldwide holdings of the pound have been increasing as a percentage of global reserves, in contrast to a decline in the percentage held in dollars. These trends are helped by the massive amount of international capital that flows through London.
In fact, most would be surprised to know that more of the world’s dollar deposits are place in London than in New York. This is in part because of the history of London as a financial center. More recently, the surge is being attributed increasingly to onerous regulatory challenges in the U.S. (Sarbanes-Oxley, for example) as compared to London, where regulations are streamlined.
Bonds were already having a rough day off the BOE news in early trading … then they took another good whacking after 1 p.m. due to an ugly TIPS auction. Definitely worth keeping an eye on interest rates here, IMHO…
http://interestrateroundup.blogspot.com
“a myopic focus on pure CPI-type inflation, and a complete disregard for ASSET inflation. U.S. Fed officials repeatedly commented during the housing boom that surging U.S. home prices were essentially not their problem.”
Bugs to FED officials: Eh, I don’t think so
Tweedy Bird to Sylvester: “You’re a vvvvery BAD cat!…. “Oh Grannny!”
Mike, thanks for the graphics.
Love it. I have some large CDs maturing soon.
Comment by what appears to be an honest loan officer. 1/10/07 from brokers outpost.
This is whats driving me nutz right now and making me look bad, I get to many w2’s that were overstated for income originally or referral from realtor of which no way borrower was going to qualify w/o overstating and go somewhere else who gets teh deal closed quickly (and in the process gives the guy a fake job in one case).
I closed 1 deal in November, and 1 deal only in works right now, why…I do marketing, leads, and some realtor referral, this what I’m constantly running into, that or people have value cut on appraisals. I had 5 referrals in Decemeber how many did I close, none, again all were W2′ and originally overstated. Two of them full doc would have been 65 dti, ran DU not accepted.
This sucks, how are you guys closing 10+ a month lol. In my cases its not like 500-1K a month over, one lady was at 5K a month had to refi and I couldn’t do it and found somebody that did it at 10K a month when I talked to her and even after I explained the risk, they don’t care, they got their refi and cash and could careless. But what sucks is these guys doing this stated W2 income bs are making the money and not getting caught really (very few compared to how many in the biz).
And damn near none of them can meet no doc/no ratio requirements, and the ones that did would not accept teh rate and went elsewhere “stated”.
THIS IS HAPPENING EVERYDAY NOW 1000 TIMES A DAY. THIS IS GOING TO CAUSE THE MARKET TO END BADLY.
Russ Winter has a great recap of subprime loan volumes and the “Misery Map” today:
http://wallstreetexaminer.com/blogs/winter/?p=301#more-301
He doesn’t mention the “fraud factor” but we know it’s huge.
I actually was talking to a guy who bought an overpriced POS a couple of years ago, I told that I thought the price was too high, he said he got the equity out after refinancing, put in the bank, currently pays the morgage but does not care what happens later.
can someone explain if this is prevelant and may that’s why people dont care.
David — great quote — thanks. Made my day, as this stuff is what I need to feed my wife regularly to keep her off the nestamphetamine. She’s a nest addict, but this type of patch seems to work.
People here keep talking about contractor antics: This story is making the rounds on digg
http://www.bewarehomeandgarden.com/
Interesting story, but the writer is pretty disingenuous, IMO, by calling this perp a “friend.” Maybe that’s the way Yankees do it, but no Southerner would ever call a person, upon whom he sic’d the cops, a “friend.” I believe that is because we tend to take care of our own problems in-house (think, 12 ga. — “Gimme my money back, Bubba, and we can settle this real peaceful.”). If a person is a real asshole, we rarely call him a friend/buddy. I suppose that in geographic areas where nearly everyone is an asshole, that philosophy would never work.
/flame-sensor on
hahaha
Grew up just north of the Mason-Dixon line, still in PA but with a bit of Southern influence creeping in.
Just one dad-with-shotgun story: Dad comes home from work and discovers his car is missing. For some reason he has a good clue as to who took it. He and his buddy leave the house that night, toting shotguns. Next morning, voila - car’s back in the lot!
No police involved.
LIBOR 1 month 5.32
LIBOR 2 months 5.345
LIBOR 3 months 5.36
LIBOR 6 months 5.37688
LIBOR 12 months 5.34
___________________________________
Same as they have been for 9 months now. No relief in sight for all the FB’s with a LIBOR based loan with 200-500 bps spread…
this can’t be- what about wages?
“The latest economic statistics show that consumers depended on new debt for 90% of their cash flow during 2006. In 2005, 88% of new consumer cash flow came from deb
Keyword “new”.
They are citing percentage of increased spending attributable to debt.
Got a letter today from my mortgage holder, Washington Mutual. The sold the loan to Wells Fargo. It is a stated income loan as I am self-employed, my credit score is in the 800s, I re-fi’d 4 years ago into a 15 year fixed at .5%, no HELOC, no lates. So this is not a higher risk loan. I am wondering if this is evidence of credit tightening. But I am glad to be with a better quality bank. My original 30 year fixed was with Countrywide, I refi’d through Greenlight who sold it to WAMU, now Wells. Moving up the food chain.
“15 year fixed at .5%”
oops I meant 5.5%
“I am wondering if this is evidence of credit tightening”
Probably not…this happens all the time.
Wells Fargo bought a huge chunk of WAMU’s Mortgage portfolio 6 months ago. Doesn’t have to do with credit tightening.
http://www.bizjournals.com/eastbay/stories/2006/07/17/daily22.html
Why would WAMU sell your loan? Its clearly a good one. Maybe because it can’t sell the crap in its portfolio and needs to generate as much cash (for now) as possible.
Smells of desperation, no?
WAMU sold many fixed rate loans over the last 6 months. Apparently their investment belief is that rates are going a lot higher and do not wish to be in positions that cannot adjust.
“Apparently their investment belief is that rates are going a lot higher”
Hoz, interesting…do you have a reference for that? I’d like to know more.
What can I say. I have a sick sense of humor. Found this on craigslist.
http://dallas.craigslist.org/ofc/260979149.html
(the alleged “employer” is a mortgage guy)
Chick — the post has been flagged down — presumably to avoid the prying eyes you generated. Too bad I clicked so late in the day.
Pensacola, FL
I saw this in a local classified ad:
“HOUSE FOR sale, Good Sense home, 2007 square feet of living space and front porch on 2 acres in peaceful country setting, 3 bedrooms, 2 full baths; new roof, paint job inside the house and carpet, large brick fireplace and handcrafted cabinets in kitchen, $140,000 and will pay closing cost up to $2500. House insurance $556/year and homestead tax is $250/year; free Mercedes Benz, ‘97, with purchase of house.”
Perhaps this might be a good deal for someone. However, I’m always skeptical when the seller omits the specific location of a property.
Yeah better sort out the location. By the price of the insurance should be located in the part of “Pensacola” that’s on the Florida/Bama border like Jay/Century/Molino. LOL.
The property tax amount the present owner is paying has nothing to do with the amount the buyer will have to pay. It could be as high as $4,200, but it could also be as low as $1,400. I doubt tax rates in that neck of the wood would go lower than 1% of sales price, or guestimated value (as per tax appraiser). Here in Hillsborough County there are 28 or 29 tax rates, the highest at 3%.
Ditto what Incredulous posted — I’d guess the property taxes for a buyer at $250K will be about $2,000, assuming the property is outside Escambia County — slightly higher if within.
Does anyone know where I could get info or find a blog related to what’s happening to real estate prices or new home projects in the Palm Springs area?
Here, if you’re patient. You’re probably screwed if you’re not.
Sorry to sound so flippant, but until you locate a Palm Springs-specific housing blog that is not REIC sponsored, you are best off reading Ben’s blog until you learn what you need to know. IMO, there’s plenty of time left, regarding a buy, so if you need to relocate right now, rent for a while and get a relative bargain in late 2007 or in 2008.
Thanks. This is an informative site.
I don’t get this, doesn’t RE always go up?
http://realtytimes.com/rtcpages/20070111_appealtax.htm
“In the current market, however, the increased incidence of foreclosures would indicate, in some cases, there’s not enough value in some properties to cover the mortgage. Some owners, wisely or not, are allowing their homes to go back to the bank.
The housing boom frenzy caused many buyers to bid up the price of the property and artificially inflate the value. In some markets, sellers who purchased homes at the height of the boom and must now sell, are finding they have to price their home to move. That means a price, and possibly, value reduction. “
LOL: “Don’t forget, property taxes are also one of many home ownership related expenses that qualify for a deduction on your income tax returns. The smaller the tax, the smaller the deduction.”
Whoa, Mama! I want a higher property tax so I can take a higher deduction on my federal income tax! Damn — why didn’t I think of that. I could have been saving so much…
Here’s another article from Hawaii that is biased towards the “real estate expert”. The condominium number of sales last quarter is 1034 compared to 1783 of the same period last year. That is a whooping 42% drop and the writer only mention a 15% drop in single-family homes. The chart does not even include a column for the % sales change.
http://honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20070111/BUSINESS04/701110310/1071/BUSINESS
The Orlando Sentinel today, on the top of the front page, proclaimed that area sales were just shy of the record. But if I understand Dimedropped’s post (yesterday or the day before) correctly, the reporting by the Orl. area RE board is totally misleading. If I read DD’s post correctly, the board touts sales for a five-county area and shows listings balances for a two-county area — his/her attacks on that going unanswered.
I love blogs, particularly Ben’s, for enabling common folk to collaborate in such a way as to force the truth from (or expose it of) the liars. Unfortunately, truth is the nemesis of government, so expect that the freedoms we enjoy on Ben’s blog today will be gone within a few years. It’s awesome that we have been able to enjoy it, at its fullest, here.
Doubters? Few likely among Ben’s posters. Nevertheless — I’ll be on “the other side of the dirt” in less than 20 years — most doubters will have plenty of time to remember this no-brainer prediction of today.
I subscribe to a business listing service (we’re looking to buy a business) and saw this today in the daily e-mail:
Financials (glossary of terms)
Asking: $39,000
Gross: Not Disclosed
Cash Flow: Not Disclosed
FF&E: $30,000 (included in the asking price)
Business Summary
Attention mortgage brokers and real estate brokers: Storefront, turnkey office available in South Orange County, near Board of Realtors, for about $3,500 monthly expenses! Office was totally renovated in July 2006. Office includes: 2 private offices, conference room, reception area, custom-built reception desk, “bull pen” with four computer stations, kitchen with microwave and cappuccino machine, private restroom. Items and equipment included in price (100% owned, no leases or loans): 22 salespersons in office, 7 computer systems (2006), networked routers and computer equipment, 2 multi-function printers, 1 Dell Plasma TV, 10 office chairs, conference table, 6 phones, reception furniture with granite counters in kitchen and reception, reception waiting furniture with leather couches, 2 office desks and designer artwork.
General Information
Year Established: 2002
Employees: 24
Facilities: Real estate office, near board of Realtors in South Orange County. Broker is moving to Costa Rica.
Where, in South Orange County? Is it on 441? And what are they selling — the balance of their lease? Seems 99% they don’t own the land.
Anyone else notice that zillow.com has stopped posting their “last updated on” information?
Any guesses as to why?
Why is the price of oil going down? USO is at 44.34 right now, down another 2%. Just wondering.
disregard my post. It is there now.
(Sorry if already posted…)
January 11, 2007 10:58 AM ET
Bies says U.S. lenders should tighten standards
WASHINGTON (Reuters) - Federal Reserve Governor Susan Bies said on Thursday looser underwriting standards were partly responsible for recent rises in late mortgage payments and that lenders should tighten risk management practices.
…
“Many industry observers believe the poor performance of more recently originated subprime loans is due primarily to looser underwriting standards, including limited or no verification of borrower income and high loan-to-value transactions,” Bies said. She added that lenders need to be “specially diligent” when making such loans.
——————————————————————————–
Ya think???
http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&Date=20070111&ID=6335528
A Dozen Reasons To Worry.
http://www.tinyurl.com/yfmko2
By none other than Gary Shilling.
He figures the housing market will COLLAPSE.
That is a change from his previous forecasts.
“He figures the housing market will COLLAPSE.”
TD - so do I. I have bet ALL my marbles on that, which is very uncharacteristic of me. Unlike, sadly, most Americans today, if I am correct I will give Ben Jones a huge amount of credit and if I am wrong, I will eat my probably unsubstantial loss in silence, blaming only myself.
That said, I am increasingly cocky about all this. Ben’s blog is, to me, the housing equivalent of the TV series, “Early Edition.”
This is simply hilarious, Barry calling the NAR people for what they are… “The rest of the NAR release amounted to a thinly veiled cry for help, revealing deep problems with either alcohol abuse or dementia. In a related development, several NAR economists were treated for blunt head trauma, a medical condition which helps explain the rest of their recent public statements.”
http://usmarket.seekingalpha.com/article/23983
So, does the White House read this blog? Wonder what the HOA fees will be.
Gated communities’ planned for Baghdad
New U.S. strategy calls for creating zones of safety in the Iraqi capital, then working outward.
http://www.latimes.com/news/nationworld/nation/la-na-military11jan11,0,6740191.story?coll=la-home-nation
So, does the White House read this blog?
The problem is, nobody at the White House seems to read ANYTHING.
Check out : http://itsapriority.com
So I’m listening to the TV last night and I hear this breathy, frantic, announcement from the WA. State Realtors directing people to check out a website set up by them to “combat high home prices” by contacting your local legislators.
Doesn’t add up right?
Thank God I just heard it again now. And this time was able get the site name, etc.
I’m thinking this is happening in other states too as there was a box to check for what state you live in.
there’s a spot with a pre-written letter that you sign and send. It goes out to nearly every lawmaker in the state.
***You can delete their letter and write your own****
I suggested lawmakers take a look at appraisal fraud and extraordinarily loose lending as the real culprits behind the high prices.
If this is a new tack by the NAR, to get the average Joe involved, then I suggest we get involved.
Seattle — good eyes. I think that, fortunately, the over-pricing problem very likely will take care of itself within the next 18 months.