Riding The Real Estate Cycle In California
Inside Bay Area reports from California. “Last year, James and Barbara Morgan refinanced their mortgage into a subprime loan in hopes of lowering their house payments. Now the couple worry that the high-risk loan could force them to sell the East Oakland home they have lived in for more than 30 years.”
“First-time homeowner Carmen Rodriguez likes everything about the three-bedroom house in San Pablo she bought in September and shares with her brother. Except for the loan. Rodriguez, speaking through a Spanish interpreter, said the payments on her loan have already increased by a third, rising $500 to $2,000 a month.”
“‘I am very frustrated. I am very upset,” said Rodriguez, whose monthly take-home pay is about $1,700. ‘I have not been able to pay other bills.’”
“The Morgans, retired shipyard workers who live on a fixed income, are paying $1,142 a month on their $355,000 subprime adjustable-rate mortgage for a four-bedroom house. In two years, their monthly payments could reach $3,000 under the terms of their loan, Barbara Morgan said.”
“Morgan said she was told ‘not to worry about it’ when she asked the loan representative about interest rates. These days, she has plenty to worry about. ‘I’m trying to get my house ready to sell to pay off the loan,’ Morgan said.”
“In the Bay Area, default notices for all loans more than doubled to 5,362 in the fourth quarter of 2006 from a year earlier, according to DataQuick. About 32 percent of homeowners who got default notices in 2006 ended up losing their homes to foreclosure in the fourth quarter, compared with 8 percent in the same period of 2005, according to DataQuick.”
“San Francisco-based Wells Fargo & Co. said this past week it was eliminating more than 500 jobs in a division that makes subprime loans.”
“‘Market discipline in this industry is swift, can be severe and is more effective at changing lending practices than any potential changes in regulation,’ said Doug Duncan, chief economist for the Mortgage Bankers Association. ‘Some of the lenders who have been exiting the business have stated they didn’t underwrite properly the risk in the loan.’”
The Record Searchlight. “From 2001 to 2006, home values in the Redding area more than doubled, an unprecedented run-up in appreciation. The rise in real estate was buoyed by a bevy of alternative loan products, including the subprime market.”
“Joe Rodola, a Redding credit counselor, said he is seeing more people struggling to come up with the monthly payment on their variable-rate home loan. ‘We are seeing more people who owe more money than what their home is worth. That scares me to death,’ Rodola said.”
“At the peak of the market, Redding loan officer Sherrie Downard says practically anybody with credit, bad or good, was able to get 100 percent financing to buy their dream home. And if one lender refused to write you up, you could walk across the street where your business was welcomed.”
“‘You didn’t have to verify your income or assets, so we were giving loans to everybody,’ said Downard, who’s been a loan officer for 17 years. Downard estimates that 15 percent of the loans her office did in 2006 were subprime.”
“She recalls clients coming in with two car payments, credit card debt and wanting to buy a $400,000 home with nothing down. ‘Everybody was trying to keep up with the Joneses,’ Downard said. ‘You can educate them (borrowers) to do the right thing, but it’s up to them to make the right choice.’”
“But the market sagged, home values stopped going up at a break-neck pace. Suddenly, subprime borrowers discovered that refinancing was not an option. ‘If you bought a home in the last 18 months, unless you did some improvements, typically you are not seeing a dime of appreciation,’ said Mike Neves of Access Mortgage in Redding.”
“Mike Van Bockern, co-owner of Foreclosure Specialists in Redding, said his business is up. Van Bockern gets involved in the final stage of foreclosure, the notice of sale. ‘The majority of them (public sales) are new loans (originated in 2005 and 2006). There is no equity,’ Van Bockern said.”
“Credit counselor Rodola said it’s easier for somebody to walk away when they don’t have a financial stake in the home. ‘From a realistic standpoint, you pay a very big penalty on your credit report. Foreclosure is probably the worst thing that can happen,’ Rodola said.”
“But the emotional and financial pull to keep your home isn’t there when you didn’t put any money down and you haven’t built up any equity. ‘If you go upside-down, what do you care?’ Rodola said.”
The San Diego Business Journal. “In the fourth quarter of 2006, San Diego County experienced a 169 percent increase in homes receiving notices of loan default from a year ago. Default notices were up to 3,150 from 1,173 for the like quarter 2005, according to DataQuick.”
“Throughout California, there were 37,273 default notices, notifying homeowners 90 days behind on payments, sent from October to December 2006. The study, released in January, states that foreclosures tend to occur a year or two after the loan is made. Most of the loans currently entering default originated between January 2005 and February 2006.”
“But Chris Cagan, director of research and analytics at Santa Ana-based First American CoreLogic Inc, said that there are ways to recover on defaults before falling into foreclosure and a majority of homeowners are getting themselves out before it gets to that point.”
“‘They can pay the defaulted payments, refinance, renegotiate (with the lender) and some people do a short sell, where they sell their home at slightly lower than purchase price to avoid the large losses from foreclosure,’ Cagan said. ‘Lenders don’t want to be burned if they don’t have to be.’”
The Orange County Register. “My Big Orange Index, a compilation of three dozen economic markers of the local economy, stalled this past winter.”
“You don’t need a database of economic trends to know the slowdown’s culprit: that sagging real estate market. The Big O’s Property Owner Index had its worst quarter this winter since 1995.”
“One of the biggest challenges presented by real estate’s weakness, after what amounted to a nine-year winning streak, is the unknown it presents to the all-important job market.”
“Coming into 2006, real estate and finance work represented nearly half of the 30,000-a year job gains produced by Orange County bosses in the previous three years.”
“In the past year, O.C. companies added another 27,000 jobs. Real estate’s contribution? Just a 1,700 boost, a sum counted before the many mortgage companies that dot this town began pruning staff.”
“By The Big O’s count, all real estate loans made on Orange County property peaked back in the autumn of 2003, at a rate of $119 billion a year. This winter, local lending is down to an $85 billion annual rate.”
“Any industries suffering a 30 percent drop in activity will see work-force reductions. So forget the grand debate about the merits of some of the recent lending. There are simply too many mortgage makers.”
“Home buying peaked by The Big O’s count in the winter of 2003-04, shortly after the Federal Reserve ended its extra easy money policies. Three years later, home sales in O.C. are off 40 percent. Homes haven’t been this hard to sell since 1996, just before real estate’s great run began.”
“This dreary backdrop doesn’t jazz builders. Chapman U. estimates that residential building permits are running at a four-year low.”
“The Big O’s Banker index suggests a growing flock of families can’t meet the financial burdens of home ownership. Local property tax bills haven’t been so tardy since the summer of 1997. Bankers are filing mortgage default notices, the first step toward foreclosure, on O.C. real estate at the fastest pace since the summer of ‘98.”
“Joe Magruder is ready for a break after his recent career path placed him with a pair of employers in the midst of eye-catching economic whirlwinds. Magruder is a payroll specialist at ECC Capital of Irvine. Magruder’s been told he may only have a few more weeks left to work with ECC, a company that’s pondering its own corporate fate.”
“Magruder, a Dove Canyon resident, is philosophical about his plight. He spent nearly five years helping ECC ride up, and now down, the real estate cycle. The volatility reminds him of his previous work at a dot-com forerunner Epoch Networks from Orange County.”
“‘I’m not bitter at all,’ he says of his recent career turbulence. ‘Business is business.’”
‘As Lockeford leaders continue to work with two developers in planning subdivisions that will bring a combined 500 homes to the town located on Highway 88 east of Lodi. ‘A problem in the three-block downtown core is that some buildings are blighted and have code violations. Some property has junked cars out front and graffiti is a problem, too,’ Fowler said. ‘I’ve been told that it looks ‘ratty’ down there, and it does. When you live here, you get kind of conditioned to it.’
‘In La Mesa, developer Barratt American is marketing its Aragon townhome project as ideal for unrelated buyers who must double up to afford a home, a concept called ‘mingling.’ Despite warnings from friends that she was making a mistake, Burrell is happy with her unconventional version of the American Dream.’
‘I had people tell me, ‘Don’t do this because you always want to own something yourself,’ but in a place like San Diego I will never be able to own anything,’ she said.’
‘Leslie and I came up with an agreement,’ she continued. ‘We agreed on how long we are going to stay there. We agreed on what will happen if somebody gets married. We are both in our 30s and that’s the stage where things change. We talked about what would happen if someone takes a job someplace else. We agreed on shared equity, what we would do if we sold.’
I’m afraid that Shelia and Leslie are going to get a nasty surprise if either of them ever wants out.
High Density + Shared Quarters == White Elephant
Shared equity, or mingling is a very bad idea.
If you cant afford to buy a place on your own, just rent.
“Some properties have junk cars out front and graffiti is a problem…”
That describes about 95% of California.
I live in Santa Barbara. About one hour ago I came to my shop. Two homeless bums were on the property. I told them to leave. One of the bums came towards me, cursing. I called the Santa Barbara police. The bums left the property and walked towards the beach, which is a homeless hangout. I followed them, talking to police dispatch on my cell phone. As the bums entered the train station the police arrived. To make a long story short the police were angry at ME for calling them.
Californians have no one but themselves to blame for the disaster befalling our state. We elect state and local representatives who don’t give a damn about illegal immigration, gangs, high taxes,etc.
I’m no hero, but it takes a cast iron nervous system to try to deal with these problems in a common sense manner when you’re talking to Santa Barbara’s limo liberal elite ruling class.
I believe in giving people an opportunity to have a productive and happy life here in America, but the worst thing we can do is coddle people when they do wrong or they’re slobs. The best lessons I’ve ever learned in life are the ones when I’ve had a boot applied to my stupid ass.
“One of the bums came towards me, cursing. I called the Santa Barbara police. The bums left the property and walked towards the beach, which is a homeless hangout. I followed them…”
At this point, aren’t you just doing what he did?
“He came towards me..”
If you asked and they left the property? Aren’t you then “coming towards them..?”
He came towards me on my property,cursing, AFTER I asked him to leave. That’s trespassing with intent to commit assault.
Are you suggesting that after the attempted assault on my property ( which, by the way, I lease, so when I say “my property” I mean leased property) I had no right to follow him at a distance so the police can, at the very least, make a contact card on him?
Did you ever the Bumfight videos? If they act agressive i say pummel em.
You ned to hire private protection, just like the limo libs do.
Most of the houses around here have protection services, since the local police won’t deal with the bums and lunatics unless they physically assault something or someone. For example, the police won’t chase them out of the alleys or the nooks between structures.
OTOH, I once watched one of these nutjobs assault a bus tire in front of two cops. He pulled out a knife and started stabbing the front tire. I think he was trying to get arrested, and the cops obliged him.
“one of these nutjobs”
Exactly, most of them should be institutionalized.
I guess Liberals are responsible for God creating chemical imbalances in certain peoples brains. Never knew Liberal’s maintained that kind of Almighty power…
You haven’t answered my question. Are you suggesting that after the homeless bum came towards me, moving INTO the property, cursing, I had no right to follow him at a distance so the police could contact him?
I ask this question of you with all due respect.
In the situation you further describe, from my understanding of the law, you, of course, were within your rights. But lacking any witnesses or signs of a physical struggle, I am suggesting that it would be “his word against yours” to the the eyes of the police officers.
Or haven’t you ever watched Cops?
Even a homeless mental patient has rights. Thats why he’s homeless. It would violate his “civil liberties” to house him in a mental facility.
Personally, knowing the reality of the policing and legal situation, I would try to be has pleasant as possible with an obviously unstable homeless type who hangs around the place I need to make my livelihood…
“Even a homeless mental patient has rights. Thats why he’s homeless.”
You have the right to remain homeless. What an awful Catch-22 that is.
Clearview did put in his initial post that it was 2 homeless guys so technically there was a witness. Being pleasant might make them feel welcome.
We have a crazy woman in our neighborhood. She hasn’t been around for a while but when she is she sleeps in the doorway of a clothing store. She leaves a nasty mess behind her. It’s not politically correct but I would not be too pleasant and encourage her to stay if my livelihood depended on her leaving. It sounds like Clearview could end up with the same problem. Small business owners have so many obstacles.
Thanks for your reply.
My purpose for wanting the police to contact him was to have his name recorded on a contact card. That way, in the future, if I see this bum causing trouble, I can refer the police to the contact card they made on this guy today. Not that it does any good.
But getting back to your original point, you seemed to be suggesting that I was aggressing against this violent bum by following him. I kept a distance of 20 feet, I was talking to police dispatch as I was following him, and when he turned around and came towards me (which he did twice) I backed up and maintained my distance.
As far as your statement about being nice to unstable ( and violent) homeless bums. The city of Santa Barbara goes out of its way to be nice to violent bums and gangbangers. They provide 5, count them, 5 homeless shelters, in a city which has a population of 93,000 people. Gangbangers and illegals are given millions of dollars worth of housing subsidies every year. Free health care, little or no trouble from the police, a tolerant liberal population. The city housing authority owns thousands of government subsidized apartment units, with densities as high as 140 units per acre. These apartments are gang havens. And the homeowners/taxpayers tolerate all of this, because over the past 10 years property values went up and up and up, and as long as they were “making money” with their homes they couldn’t be bothered with homeless bums, swarming gangbangers, dense condo/apartment projects, high taxes, etc etc etc.
Now, property values are dropping like a rock. It’s not going to be too long before homeowner/voters begin to care about all the crap that’s been going down, because bums and gangbangers affect property values.
I feel for you, clearview.
It’s difficult to live or work in areas which are full of potentially dangerous people. Yes, homeless people are potentially dangerous for the very reason imploder stated — many of them have mental issues.
We do need to do something about it, like bring back mental institutions, even if taxpayers have to pay for it. Either way, we pay. I’d rather have safer, cleaner streets and subsidized institutions than have to pay for law enforcement, jails, etc. By constantly dealing with mental illness through the legal system (police/courts/jail), we are not saving money, but creating a more dangerous environment for the rest of us.
CA Renter - I agree with you. The environment is more dangerous with mentally ill people roaming the streets.
One of my siblings has paranoid schizophrenia. Over the last 30 years we have tried everything in order to help her. Now we have given up. I am actually afraid of her. She calls people and makes threats. She lives in a homeless shelter in Los Angeles. There does not seem to be any reasonable solution for her problem, for her or for us or for the people who are subjected to her state of being. One time I had the police pick her up so that we could bring her home. She refused, saying that she wanted to be an “urban outdoorswoman”. She does have a way with words, although what she meant is she preferred to live next to a dumpster than in a house.
Ozarkian,
Sorry to hear about your sister. You’re right, there are some people who cannot be helped, and it’s better for them and everyone else if they can at least be cared for in a reasonably safe, secure institution.
I used to date a girl in the late 1980’s who was a social worker who dealt with the mentally unstable. She said that the “compassionate conservatives” (Reagan/Bush Sr.) gutted the mental health care system (at least in CA) and that a lot of facilities where the mentally unstable were kept, were closed as part of spending cuts.
What happened to the inmates?…..they were simply pushed out the door and started living on the streets.
Meanwhile CEO pay increased from 20x that of the top non management employee to 200x that of the top non management employee.
One would hope that a country like America (the beacon of democracy and “freedom”), could at least provide for those who literally cannot help themselves.
The spending on caring for the mentally challenged is a drop in the bucket compared to the Iraq debacle….
Careful with the “compassionate conservatives” line in Cali.
Mental health issues are states rights. Very important distinction because the Federal Government has has no right meddling in those areas. They own defense, interstate commerce, and such areas, and have given up all of the welfare componenents.
If you want to blame someone, pick on the Governors of California who are hiring their buddies to build large-scale infrastructure at 200% over cost with “foreign” labor. Ever wonder why there are so many rich people and so many pooor people in California? It’s a rob from the poor and give to the rich state. And it continues to vote democrat… corruption knows no party lines.
Chuck Ponzi
http://www.socalbubble.com
“I’m no hero…”
And you don’t want to be one in California either.
ClearView, I cheer you on. I don’t coddle liberals or their product - homeless bums. Unlike a poster below. When I was in college, there was a gang fight right on my parents front lawn outside my bedroom window. I’m for zero tolerance.
I am making a predicion. I foresee a whiny post by Joe Momma in the blog’s near future.
How dare Bill in Phoenix imply that liberal social policies of the past 40 years have had any negative consequences on this country? He had better hurry up and bash George Bush or the war in Iraq. Even though this blog has proven that it hates all political extremists, guys like DavidCee and Joe Momma always whine when there is a bashing of liberalism.
“How dare Bill in Phoenix imply that liberal social policies of the past 40 years have had any negative consequences on this country?”
Mmmmm, nobody said that…
Plus this statement is so general as to be meaningless.
I’m sure there’s been negative consequences over some “liberal social policy” enacted at some point in the last 40 years. The same could be said about some “conservative social policy” that went awry over the last 40 years. There is no perfection in our political system.
An obvious fuddled attempt to misdirect the argument.
You still haven’t answered my question which was posted for the second time at 14:29.
I agree Imploder. But there are too many people (and some on the blog) that blame one side or the other. I blame both. Which is more to blame, the entitlement mindset or the “ownership society”? I want all the extremists to be called out. I wasn’t trying to direct an argument any where.
“You still haven’t answered my question which was posted for the second time at 14:29.”
I type slow…
you did reply above. Thank you.
” I don’t coddle liberals or their product - ”
The main product of Homeless in CA was when Reagan as Govenor closed the permanent residency Mental Hospitals in CA. 3/4 of the homeless are mentally unstable. Reagan was hardly a liberal.
“President Kennedy, in an address to Congress, calls for a reduction, “over a number of years, and by hundreds of thousands, [in the number] of persons confined” to residential institutions, and he asks that methods be found “to retain in and return to the community the mentally ill and mentally retarded, and there to restore and revitalize their lives through better health programs and strengthened educational and rehabilitation services.” Though not labeled such at the time, this is a call for deinstitutionalization and increased community services.”
I don’t know the history of Reagan’s actions but the process of de-institutionalizing people began under Kennedy.
Wiki:
“Reagan promoted the dismantling of the public psychiatric hospital system, proposing that community-based housing and treatment replace involuntary hospitalization, which he saw as a violation of civil liberties issue. Critics allege that the community replacement facilities have never been adequately funded, either by Reagan or his successors, and that his dismantling of the psychiatric hospitals resulted in an increase in homelessness, motivated more by a desire to find ways of cutting public expenditure.”
So it was a political decision made at times by both sides. Not really a “product of liberals…”
Also, what do you suggest for carrying out your “Zero tolerance” for the mentally infirm?
De-institutionalization was one of those circumstances where both liberals and conservatives saw something they liked. Liberals were primed to see mental institutions as something out of “One Flew Over the Cuckoo’s Nest,” full of authoritarian Nurse Ratcheds, and who are we to say who’s really crazy in this mad world, blah blah blah. Conservatives didn’t want to spend the money they cost. So when anti-psychotic drugs started to come out, everybody saw something to like.
Unfortunately, deinstitutionalized people don’t take their meds. They gravitate to public spaces, rendering them unlivable by normal people.
Clearview, you should have some tolerance for the mentally ill. If someone swears at you and you think they should be arrested you are the one with mental problems.
Count your blessings that you live in SB and not Santa Monica where I live. Our homeless people kick ass on your homeless people.
> Count your blessings that you live in SB and not Santa Monica where I live. Our homeless people kick ass on your homeless people.
Yeah, but the true “hard core” homeless are in San Francisco. They really take the cake.
“If someone swears at you and you think they should be arrested you are the one with mental problems.”
What? I’m trying to figure out if this was written tongue in cheek.
I work with somebody that was in San Francisco last week for a convention. I asked if he went down to the wharf. He said he wouldn’t go anywhere near the wharf. He said the homeless are every place and they are very aggressive.
I was last in the Bay Area in 2003. It seemed fine to me. Is this new description accurate?
Luckily the homeless people here in Tokyo and large Japanese cities. There is not much acceptance of homeless people here, though there are some foriegn companies that try to help.
However, the homeless people here in Japan have taken over what were once very nice parks. So most people stay away and have become virtual dumps.
“So most people stay away and have become virtual dumps.”
The people that stay away and become virtual dumps… is this from lack of exercise due to not using the parks?
“I foresee a whiny post by Joe Momma in the blog’s near future.”
You beat him to it.
Ouch! That’s Gotta Hurt!
Liberals produce homeless bums? Damn, I didn’t have that on my list of liberal superpowers. I’ll put it right down between “invoking the wrath of god on our cities for coddling gays” and “eating Christian babies with hollandaise sauce.”
I sure hope I never see a liberal, but if I do, I’ll be sure to run…they sound terrifying.
I prefer Bernaise.
That is why California is not the “Golden State” anymore. With increases in taxes etc, housing equitys down, the middle class will be with in 10 years severly damaged or gone as their incomes can not possible keep up in this new world of the international economy. Sad as housing will be the final nail in the coffin.
Oh it’s still golden all right, the golden yellow of millions of homeless people peeing on stuff.
San Francisco… America’s Largest Public Urinal™
Clearview, I think you did the right thing. It may not feel like a success right now, but maybe those bums (mentally ill or not) will consider modifying their behavior and avoiding the hassle next time.
If you are not satisfied with the police response, contact their supervisor and make a stink. The “little” stuff is part of their job, too- that includes noise complaints and vandalism.
I lived in Pasadena for many years, and it changed from a quiet, conservative town with a hard-a$$ police department to a noisy, chaotic place where the police take hours to show up for anything below felony grade. The liberal city coucil have given away so much of the city budget appeasing the “underprivileged” that they’ve had to sell the city to high-density developers to try to get back into the black.
WHY NOT INSTALL A WEB CAM so you can view your shop from home????
I came to the shop this morning to do some cleaning. I wasn’t here to do law enforcement.
Web Cam? We can do that, but someone above suggested a private security service, which might be a better way to go.
But are web cams and private security services and walled/gated communities the answer?
There used to be a time when a man could defend himself and his family with his fists and such action was accepted.
If I had clocked that bum I would have been arrested and, this being Santa Barbara, convicted of assault.
That was I that suggested a private security service. They are trained to deal with stuff like this, and remove the temptation to take matters in your own hands, which is usually a bad idea.
Regular patrols serve as a deterrant to all manner of things that you don’t want happening on your property, whether you are there or not.
Think of it as the “bum tax” you pay for living in an attractive locale.
As for the comment above about Santa Monica bums vs. other cities: We had some very picky ones around here a while back, for whom drinking out of faucets was not good enough. They were opening bottles of Sparklets that were stored on people’s balconies. Creeps me out, but it shows they have taste, I guess.
At least they haven’t defecated in the electrical service enclosure recently.
I’m astonished at what craven cowards the so-called men in our society have become. Even in here, posters who I’ve otherwise respected, are telling clearview he should hire a private security service, install webcams, and avoid antagonizing violent irrational bums.
BULLSHIT!!!
Law-abiding people have the right to go about their daily business unmolested. Their private property is just that. The authorities have long since abdicated their responsibilty to maintain law and order. Instead of telling decent people like clearview to essentially avoid confrontation, or hire private security at a cost of God-knows-how-much a year, the only appropriate and manly response is a justified sense of outrage and a desire to set things right. One of the great problems of society today is that people seem incapable of smelling the stench of decay and corruption permeating this society, much less getting upset about it.
The homeless and gang-bangers are vermin. Until society recognizes them as such, and protects itself accordingly, our sad degeneration will continue.
Ridiculous! Remember the LA riots? Cops had to go to gunstores and “borrow” superior firepower to respond appropriately to the escalating carnage. Korean grocers were the few businesses which were safe ones because they took to their roofs with semi automatic weapons (allegedly illegal because they had refused to register them as required by California law. The cops made a tactical decision to let that slide. . . ). Taking things into your own hands is often the ONLY alternative.
San Diego PD is wonderful in responding to my nuisance bum calls at my firm. I’ve only had a couple of near-physical run-ins. However, try this experiment. Buy a bunch of $5.00 McDonald’s gift certificates. When the transient asks for change because he’s hungry/out of gas/needs surgery/lost his wallet/wants to make a tinfoil hat offer him the certificate. He may take the cert but more often than not offer you some choice words in return. . .
“There used to be a time when a man could defend himself and his family with his fists and such action was accepted. If I had clocked that bum I would have been arrested and, this being Santa Barbara, convicted of assault.”
Not to mention, you probably would have cut your hand on his jaw, and got AIDS for your efforts, which you would then unknowingly pass onto your wife. Just keep calling the cops…
Or Hepatitis C
“Or Hepatitis C”
Exactly, thanks Krills. .. and you are a registered nurse…I’m sure you’d know.
Go Sammy Schadenfruede, Go. Teach that paranoid schizophrenic a lesson, Mano on Mano…
I think it is not the California it was several years ago, and not going to be anymore… The premium of 3 or 4 houndred thousand in California is only to listen mariachi music all day long from your neighbors backyard , but to be honest with those prices like in Santa Barbara, I will prefer to live somewhere in Lake Maggiore in Northern Italy or Lugano in Switzerland, where people go to listen Italian operas in Milan …
“only to listen mariachi music all day long from your neighbors backyard”
The music of madness, IMHO.
I like mariachi. It’s ranchera that I can’t stand.
Whoever thought mixing mariachi with German oom-pah polka music was a good idea was smoking something really strong.
gal, you are correct. To live in Southern California today, you must embrace Mexican culture, or be very tolerant of it, at the very least. There are still places in the state (northern part) where this is not the place - but you won’t be sunning by the sea.
Lago Maggiore is indeed a beautiful place, but northern Italy has seen it’s own escalation in prices, and the euro/dollar exchange being what it is, I think Santa Barbara might be cheaper. I do love Italian opera, but beware- Italian teenagers have their own insipid pop and rap music, and they are discovering how to turn their cars into rolling boom boxes, just like here. Uffa!
Dear Giacomo, first I like your name, it reminds me the Great Composer. I have nothing about Mexican culture, or any other culture, especially folk culture, because I think real high Art and music is based on folk culture. I like mariachi music as well as hyp-hop, but I like everything in a civilized manner. I remember twenty years ago people drove here, in California, in a very respectful manner, now everybody is trying to drive on a freeways as to show that they are the heroes who cross the boarder yesterday and “who cares about illegality”, same way they behave everywhere, because “who cares” and it is not only Mexicans, all of a sudden everybody of us “who don’t care”. It is like nobody cares that young people are dying in a war, for few people to make big money; loan officers are selling fraudulent loans, that customers for sure could not afford. Things are worst then when Soviet Union collapsed in Russia. Houses for sale are around $ 600000.00 when median family income is less than 60000.00 . Who is buying those houses in California? God knows. I suspect that Russian new billionaires are buying them in KGB orders…
My inlaws are in N. Italy-they have just the same problems, but their immigrants are Yugoslavians, Russians and “Morrokkini” (not sure how to spell that, or if it’s even a word-it was used for Morroccans, but now means pretty much anyone from Africa).
Of course, they also have the Sicilians, which they detest as much as some of you posters detest Mexicans, most of whom are just hard working folk trying to earn a living. I know if the US was as a corrupt and economically stratified system as Mexico (not saying it won’t happen, GWB put us more than halfway there, and is doing his best to get there in his last two years), and I had no other options to feed my family, I’d cross the border into Canada to get a job.
A big part of California’s problem is their pathological creedo that everybody is a victim. It’s refreshing to hear people call bums and winos just that, instead of “the homeless.”
I’m quite liberal, and believe that we need to take care of those less fortunate than ourselves.
That does not mean liberals believe in leaving bums and criminals to “do their thing” without our intervention. If the police are unable to take care of trouble, the citizens should be allowed to do so.
Good for you, clearview! Sounds like you handled the matter very well.
California is a shithole place to live already. It’s overpriced, over-rated, over-crowded, over-polluted.
I’m not buying this “where else can you go skiing and surfing on the same day” crap anymore.
Smart people have left…only the idiots and noobs remain.
Please leave and take 20 of your friends.
Here, Here!
I don’t know why Californians feel so threatened by what’s true and current. Is there any reason why have to react that way? If you can offer good advice as to why people in this current situation should stay, by all means, provide it. Otherwise, being pissy about it doesn’t do you much good.
Yes..and leaving is only a matter of time. But it’s a loss as I’m one of many well-educated, beacou tax paying people who are leaving and emptying out the state for whoever wishes to be ill-fated enough to stay.
I grew up in Northern CA , and I lived there again for a few years as an adult, in the late 90’s. Never again. For all of its fabled free-spiritedness, it is the most soulless place I’ve ever lived. Intelligent, well-educated people eat Top Ramen and commute four hours a day for the privelege of living in a semi-dilipidated, million-dollar crap box.
put your wallet where your mouth is. Will you guarantee me a job and pay my relocation expense, if I take your advice?
If yes, then I will be your huckleberry.
Why didnt you just shoot him?
Are you asking me that question?
If you are, my response is: guns are for pussies.
Isn’t Santa Barabra a werid place, very beautiful with rich and poor no middle class. And attack dog signs on all the large pieces of property in South Santa Barabra, Modesito (sp). I think drifters must try and camp in the large properties in the foothills ? Ventura CA has a bunch of homeless also. One thing I can say about Phoenix, not too many homeless here in the summer. I think they all drift to Cali ?
It’s Montecito; which is where I would start shopping the day after I won the lottery.
I think the recipe for a large homeless population is simple: Weather never gets belows freezing. Prosperous residents with Guilt. Politically-correct local government. Lots of public facilities (beach restrooms are ideal). A high density of restaurants makes for good foraging.
Montecito thanks.
‘We agreed on shared equity, what we would do if we sold.’
I smell a future bagholder, though I cannot say which of the minglers it will be…
http://www.zillow.com/Charts.htm?chartDuration=5years&zpid=6806661
I hope this links, not Cali but a Cali equity locust destination, NE albuquerque up by tramway 87111, Just look at the graph of home prices it goes straight up and straight back down. It looks like a stock chart.
Yes, my buddy here in SFBA bought just at that nasty ABQ peak. He is normally financialy cautious, and was last to buy stocks in the tech boom, too.
The “Historical Value Trends” chart was amazing. It looks like Albuquerque is toast. How can anything in New Mexico be that high? What economic base is in New Mexico? I remember driving through there and all I could think was that it was one of the most god forsaken places I’d ever passed through. It’s just hour after hour of desert and Indian reservations.
You obviously have never been in the Gila Forest or the Black Mtns.New Mexico has some awesome unspoiled wilderness.
And what is the economic base to support these extremely high real estate prices in Albuquerque and the rest of New Mexico?
A couple of very high paying national energy labs (DOE) that employ thousands at least.
I’m not trying to be a wiseguy. Is that enough to justify the prices in New Mexico? That chart showed a 90-something percent increase in 5 years.
The question to ask - Is there a reason more housing can’t be built in New Mexico?
I can’t imagine how New Mexico could ever run out of land? It just seemed to go on forever. I could buy the, “we’re running out of water argument” but I never hear that one.
How many states in the U.S. are bigger than most European countries? Nearly every square state could fit Germany, at the very least, inside of it.
I never said the prices where justified,i was just defending the beauty of NM.You seem to think the trash filled streets of Brooklyn are the only true American treasures. NY people like to bash everyone else while they live in filthy high priced concrete ghettos.
“NY people like to bash everyone else while they live in filthy high priced concrete ghettos.”
Really not true. Or at least not among the NYers I know. And the Upper West Side is hardly a ” concrete ghetto”.
Why worry about what you imagine NYers think? Repeating this tired cliches just makes you sound old.
“Repeating this tired cliches just makes you sound old.”
What’s wrong with sounding old? Like Socrates sounded old, or Plato? Jefferson? Twain?
NM is the worst state to invest in. Lots of low-paying jobs and utter poverty caused by 2 things: alcoholism and criminal histories. Well-meaning but ineffectual government that is influenced by those who are anxious to avoid California-style government, that they have gone waaay out to the other extreme of incompetency. Horrible state and definitely NOT picturesque. Note to Californians: 65mph means just that: the State Troopers will pull you over for going just 1 mph over the speed limit. No road reflectors. Beware of no paved easements on the freeways: one small oversteer will cause your car to flip. Just think: the governor of this State thinks he belongs in the Oval Office. God help us.
~Misstrial
One more thing re the “high paying” jobs at the National labs: overall the impact of these jobs is very tiny compared to the vast majority of New Mexicans who are unemployable or poorly educated. NMSU is ranked “4th tier” by US News & World Report. Also: many of the employees at these labs probably hate it here and are renting or are planing to retire elsewhere (like civilization).
~Misstrial
Maybe it’s not the best place to live, but I’ve been to some fantastically beautiful places in NM. Hiking in the Sangre de Cristos, the Gilas (as already mentioned), the Organs mountains near Las Cruces–all of these places are breathtaking.
Still doesn’t justify the 90% speculator jump in ABQ.
I would move to Albuquerque but the public schools rank very poorly. Drugs ? And then the kids will grow up get out of school and do what? Get drunk and crash into my car? I don’t think so.
Or get drunk and crash Indy cars, like the Unsers.
I think New Mexico is beautiful, though it’s got a lot of problems. Both times I have driven through it I wished I could have stayed longer.
Re: speed enforcement in NM — I’ve heard it referred to as the Land of Entrapment. Come on vacation, leave on probation!
….like a homebuilder stock chart, to be exact.
I think Misstrial lives in the southern part of the state in Las Cruces so she can speak to that area. I know a few others in NM have posted in the past as well. She has it about right, imo, other than I believe the fiscal effect of Sandia and Los Alamos National Labs is nontrivial, but localized. That has changed a bit this past year since LANL’s tax status changed and they now have to pay tax to the state. LANL was considered a non-profit educational institution since they were run by the University of California and therefore exempt from the tax. LANL employees were employees of the University of California until last year.
SNL is in Albuquerque on Kirtland Air Force Base, and LANL is in Los Alamos County. Los Alamos is about 105 miles from Abq., and about 35 miles from Santa Fe. SNL is run by Lockheed-Martin, and LANL is now run by Los Alamos National Security (LANS) for the Department of Energy.
LANL and Sandia have highly paid workers. Los Alamos county is one of the highest (maybe even the highest) per capita income counties in the US. The rest of the state has some of the poorest counties in the US – “Stepping Stone to the Third World” as some say. Remember the poster telling you a week or two ago about his trip to Farmington?
On top of the lame prices in Abq, there are really ridiculous prices in Santa Fe and Taos in Northern NM. There is a large number of state government employees in SF. SF has about the same median income as the US as a whole, while the median house prices are much higher.
IMO, much of the recent housing price run up in Abq is due to out-of-state buyers. They vanish, and there is really no support for high house prices in Abq. Several of my properties in Abq. I sold were to CA buyers. Intel has a fab plant on the west side of the Rio Grande next to Abq, and the city of Rio Rancho has grown around it. A lot of building continues in that area.
I’ve never figured out the high prices in SF. I have been of the opinion that at one time SF was considered “in”, but I do not hear that kind of talk much anymore. Again, out of state buyers likely a factor in the prices. A reasonable percentage of LANL employees live in SF. SF Mayor was on TV a couple of weeks ago bemoaning how immigration came and did a sweep in SF w/o informing city officials.
nycboy, a partial answer to a question you raised is that a lot of land in NM is Indian land and US Gov’t land. Prices in Los Alamos, for example, are very high in part because it is surrounded by DOE, Forest Service and Indian land. SF and Abq have a similar situation on a couple of their boundaries. However, the prices in Los Alamos are also dependent on the fate of LANL, since most people that live in Los Alamos work for LANL (or are retired from LANL).
NM has apparently added another #1 to their long list of accomplishments - the paper the other day said NM is the most dangerous state in which to live in the US. I think NV was #2? Immediate response was to attack the methodology, etc. NM held the title of “Dumbest State” for several years. I think the baton got passed to AZ recently. NM has a lot of high per capita rankings for unwed parents, teen pregnancy, DUI related accidents, uninsured drivers. Not surprisingly, NM also has the highest return of federal $ per tax dollar sent to DC. I’ve provided SF and Abq crime stats before, not exactly a selling point.
So you guys don’t think I’m too negative, NM does have some of the best SW food you could ever hope to eat, a long and interesting history, and some really beautiful areas.
“‘Market discipline in this industry is swift, can be severe and is more effective at changing lending practices than any potential changes in regulation,’ said Doug Duncan”
Triple Bingo. Now will someone please tell Chris Dodd?
I agree market discipline will do more than regulation but damn, I wish “swift” were a little swifter. Housing prices have been ridiculous (relative to rents and incomes) for several years.
Agree with az lender. Although “the market” will eventually correct the distortions, the problem lies in the timing. “The market” tends to create the huge boom/bust cycles we’ve seen these past few years.
If we had proper regulation (regulation…NOT subsidies), this bubble would never have gotten so out of control.
We have to decide if we are willing to allow the market to distort things to such an extent that it poses a significant threat to the rest of our economy and society.
The “market discipline” Duncan is referring to is the subprime mortgage market. The wrath of CMO investors has been swift indeed. It will take a little time for that discipline to carry over to the real estate market in the form of lower prices. Of course the March existing home sales data didn’t reflect the subprime fallout but the March new home sales data to be released tomorrow just might. Both the April existing and new home sales data should be very interesting.
I suppose that once it happened, it did so swiftly…however, it should have happened years ago.
Here in San Diego, by 2004, the majority of the new mortgages were ARMs (when rates were at their lowest point) and I/O and neg-am products were all the rage.
Where was “the market” between mid-2004 and late 2006, when things finally started to correct?
Imagine all the pain that could have been avoided if loans to unqualified people were never allowed to begin with.
Of course the March existing home sales data didn’t reflect the subprime fallout but the March new home sales data to be released tomorrow just might.
Do you mean February? How can March data be ready for publication if March isn’t even over yet?
Of course you are right, the data released Friday and today are for February sales.
I’m sure we’ll continue to hear more “pain news” from the Center For Responsible Lending as well. My question to them is, why worry about the 2.2 million borrowers that are slated for foreclosure? No one is lending to them. That barn door was left open and 2.2 million FB’s left the pasture. Close the gate and worry about the ones left.
Since you are the Center for Responsible “Lending”, what’s the use in focusing on the “Lent” crowd? You should be pushing for legislation to require the following for a start:
1. Minimum down payment of 10%.
2. No more than 4 times documented annual income to qualify for a loan.
Still very generous I think, and still carrying substantial risk. But in light of what has been going on for the last several years, just my two items alone, in comparison, sound so….. oh I don’t know….. responsible?
Ben, it appears that the lead story about the Morgan’s is four paragraphs long, but the Rodriguez’s story (story 2) got pasted between paragraph 1 and 234 of the lead story. Either way please delete this post as its just an editorial fyi.
Not really sure I get your meaning.
I think it might be a journalistic writing style: start with one story for introduction, then return to it later in the article. Keep an eye out for it in all the RE sob stories to come.
Hey Oats, the original article goes back and forth between the Morgans and the Rodriguezs. You might wanna contact the original article writer and give them your editorial advisement. Just an FYI…
Funny, I thought it was confusing style, too. Paragraphs one and four of Ben’s article belong together, not apart.
Don’t know which story was which, but I don’t feel sorry for anyone losing a house to mortgage problems if they have lived in the house for more than 30 years. Why wasn’t the mortgage all paid off? There is more stupidity on these homedebtors’ part than meets the eye.
From the Washington Post a few minutes ago:
The Federal Reserve’s stance on interest rates helped spark a comeback on Wall Street last week, and investors are hoping that this week’s data on new home sales, gross domestic product and personal spending will add momentum to the rally.
But because worries continue to plague the market over subprime lenders’ troubles and the slow housing market, investors will closely read the Commerce Department’s report Monday on February new home sales. Analysts expect a rise to 995,000 from 937,000 in January. On Friday, the National Association of Realtors reported a 3.9 percent surge in February existing home sales.
http://tinyurl.com/ypobsb
The Fed’s nonaction on interest rates must have been among the most widely predicted and unsurprising outcome in the history of financial markets. The claim that their “stance” on interest rates sparked a rally defies reason, unless one concludes that continued saber rattling on inflation without commensurate action may have cast doubt in investors’ minds that Bernanke will follow anti-inflation rhetoric with tough action.
It may have been widely expected, but it certainly started an acceleration of USD down the toilet. At least temporarily.
“The Federal Reserve’s stance on interest rates helped spark a comeback on Wall Street last week, and investors are hoping that this week’s data on new home sales, gross domestic product and personal spending will add momentum to the rally.”
This should read, “Wall Street is hoping that Goldilocks can get her butt out of bed after surviving a serious bear attack a few weeks ago.”
The odd thing is that the U.S. financial press has completely dropped discussion of the recent collapse of the subprime sector. Are they in collective denial, or has the Minister of Propaganda ordered them to stop reporting on the subject?
I vote for that second option. The masters make the rules.
Goldman Sachs and the rest of Wall Street don’t like a bear market. They get bigger bonuses when there is irrational exuberance
Some of both, no doubt. The harder you hit the brain-dead bulls, the louder they screech their bullishness. It’s going to take repeated applications of bat to skull before they’re awakened from their stupor.
‘Lenders don’t want to be burned if they don’t have to be.’”
But, unfortunately, in most cases they’ll have to be. Many will prefer to walk to what the bank has to offer them. I think folks that make predictions that FB’s will buck-up and do the right thing, take their lumps, are giving this group way too much credit. No, lenders should consider themselves lucky if, when they finally take control of the dwelling, everything hasn’t been stripped out of the place and sold on E-Bay.
“Many will prefer to walk to what the bank has to offer them. I think folks that make predictions that FB’s will buck-up and do the right thing, take their lumps, are giving this group way too much credit.”
Without the fairy dust of 20% guaranteed appreciation for the rest of your life, how many of these FB’s would have wanted to be homeowners in the first place?? Or leveraging one property to buy another? Take away the dreams of a new vehicle in the driveway and expensive vacations and whatever else your heart desires, and I don’t know how many people will continue to fork over 50%+ of their take home pay for years of financial servitude.
The FBs will gut those places. Copper is currently over $3.00 per pound. Anything that is copper will definitely be gone. Doors and light fixtures will be gone. I’ve heard of electrical plates getting taken. All those stainless steel appliances will be gone. Toilets and bathtubs might disappear.
The lenders have nobody to blame but themselves. They told these people they were homeowners. “If I own the house then I own everything inside the house.” That is an easy rationale to understand. I agree with ex-nnv that these FBs will not do one ethical thing before they are done. This is a scorched earth policy.
This’ll be great!
I can just see Home Depot advertising “pre-owned toilets!”
Gently used of course…
Paul
lol. Why not? In any house that is not new construction, all the toilets are “pre-owned.” And you don’t know how gentle the use has been either! :!~
“Last year, James and Barbara Morgan refinanced their mortgage into a subprime loan in hopes of lowering their house payments. Now the couple worry that the high-risk loan could force them to sell the East Oakland home they have lived in for more than 30 years.”
“The Morgans, retired shipyard workers who live on a fixed income, are paying $1,142 a month on their $355,000 subprime adjustable-rate mortgage for a four-bedroom house.”
Wow, they’ve owned the house 30 years and owe 355K? 30 years ago that house was probably 60k. I would of liked to know where the 290k went?… Medical emergency?
“… I would of liked to know where the 290k went?… Medical emergency?”
Countless dinners at North Beach restaurant, a new set of automobiles, some new humps, a little granite and stainless, you know, important stuff.
Yes, everyone knows that a house in Oakland is like a magical bird that craps $100 bills for people to spend on boats and dinners and plasma TVs. You have to clean the bills up a little before you use them, but they’re OK.
Retired Fixed Income and 2 people FOR FOUR BEDROOMS…..What are these MORONS thinking?????
Come on, now. I’m definitely not trying to get them off the hook, but in all likelihood this is the house they raised their family in. Back in the day, folks didn’t move OR refinance, so if this IS the house they raised their children in, I’m not surprised that they are still there…especially if it was paid off.
The crazy part is the refinance that they did. We really don’t know what their motive was, but if it was for anything other than an illness or other true emergency, then it was clearly the wrong thing for them to do.
BayQT~
If I understand things right - most shipyard workers in CA are unionized. This isn’t the huddled masses featured in “on the Waterfront”. These guys earn 70K to 80K on average and have good benefits.
That’s correct. Some of these people have GED’s and make up to $150K/yr. They once threatened to go on strike when the shipping companies wanted to bring in computers for inventory. There were two reasons for this:
1. It would be harder to steal from shipments on the dock
2. Jobs would be lost
If it was up to the unions, we would still be using the horse and buggy instead of cars
“Retired shipyard workers” doesn’t necessairly mean they were longshoremen.
On a side issue in regards to FSBO”s and real estate brokers getting desperate - I was listening to the weekly (paid time) Sunday morning real estate broker show on WPRO-am, Providence, R.I. last week and the RE MAX agents on the show were reading their weekly “mailbag” - since few if any people actually call the show
One letter they read went like this:
“I am a For Sale by Owner, selling directly, and I was wondering what if any tips or special concerns you might have for me”?
“Well the most important thing is to make sure your drug cabinet is kept locked, and make sure any money is kept well hidden. Not to scare you or anything but such sellers often have people knocking on their doors at all hours of the day, and to be on the safe side just lock those things up, lots of dangerous people running around these days, so one can never be too safe”
TRANSLATION - bypass the 20k commission and you be have druggies robbing your place very soon
By the way, this “mailbag” appears to be nearly entirely orchestrated by the two brokers running the show, although I guess its better than having fake questions to fill in air time
“The Morgans, retired shipyard workers who live on a fixed income, are paying $1,142 a month on their $355,000 subprime adjustable-rate mortgage for a four-bedroom house. In two years, their monthly payments could reach $3,000 under the terms of their loan, Barbara Morgan said.”
“Now the couple worry that the high-risk loan could force them to sell the East Oakland home they have lived in for more than 30 years.”
They have lived in the house for more than 30 years. Somehow they managed not to pay it off in that time. A house in East Oakland could not have cost more than $50k 30 years ago.
Now they have refinanced and owe $355k - where did all that money go? We are supposed to feel sorry for them?
They no doubt racked up some huge medical expenses over the years, no doubt due to their obesity. They’ve probably been taking out HELOCs to pay for the various expenses all along. I’m not sure why they’ve characterized as vicitims. They paid their expenses, didn’t go bankrupt, can probably sell the sh**box to cover the outstanding mortgage and move to a cheaper local. They still have the fixed income. And they probably go to stay in their house a lot longer than they otherwise could have afforded. Boo hoo.
As I sit in the kitchen of my 1800sq ft rented house in San Diego signing my lease extension up to Sept 2008 for a modest 2% increase in monthly rent, I can’t help but ponder why the hell anyone would be stupid enough to buy an overpriced townhouse in La Mesa with a complete stranger???
I have time and I have cash. What do you have?
A spot in the Ownership Society that Mr. Bush has been peddling.
The 290k?
probably dinners out, the lottery, cruises, new cars, fancy clothes, nice furniture
I don’t recall any of these ARMs borrowers a few years back handing money over to FIXED RATE borrowers who had to pay MORE each month (precisely because of the safety of the fixed rate) - when interest rates were scraping on the bottm for many years
FIXED RATE people that played it safe and saved carefully in CDs and other conservative investmentsc no doubt will also comprise many of the people taking the big tax hit when the latest BAILOUT PLAN is passed
“‘Market discipline in this industry is swift, can be severe and is more effective at changing lending practices than any potential changes in regulation,’ said Doug Duncan, chief economist for the Mortgage Bankers Association.
This guy is worse than DL.
He is in a tough spot, having to make public statements that encourage the subprime lending scam’s continuance, while (as some of us are aware) he privately sold his primary residence a couple of years ago and is waiting out the correction as a renter.
Stucco, subprime is getting flooded with class action suits. When does the first class action get waged against the realtor associations?
I think he is both right and wrong. Market discipline can be swift, severe, and more effective at changing lending practices than changes in regulation; however, market discipline only works this way after the lenders have made mistakes. Regulations, on the other hand, are better at trying to prevent the mistakes from occurring in the first place (assuming that the regulations are actually enforced - which seems to not have occurred during the bubble).
So, I think that market discipline will effectively change the recent (fog a mirror) lending practices much more quickly and effectively than any regulations. But market discipline will not prevent lenders from going crazy again in the future.
“Home buying peaked by The Big O’s count in the winter of 2003-04, shortly after the Federal Reserve ended its extra easy money policies. Three years later, home sales in O.C. are off 40 percent. Homes haven’t been this hard to sell since 1996, just before real estate’s great run began.”
1996 was at the bitter end of a bad recession, and two years after The OC declared bankruptcy. I am guessing by that time, “everyone” already new that “real estate always goes down.” By contrast, most indications suggest at this point that most OC residents don’t even perceive a problem with the real estate market at this point. They have just started down the hill from the top of the roller coaster, and it is a long way to the bottom from here.
Yeah, I really don’t think the the 90s downturn is an apples to apples comparison for what is going on now. It’s merely a reference point because a lot of the fundamentals are different in this downturn. I am in awe at how clueless most people are about the implications of what is coming down the pipe in the next several years. Specifically of people in SoCal. Most here just do not get it or simply don’t want to get it because it would shatter their reality of the past several years.
“Yeah, I really don’t think the the 90s downturn is an apples to apples comparison for what is going on now.”
It would be helpful if the MSM at least kept their dates straight. Comparing the early stages of the current bust with the end of the last one (1989-1996) is inherently misleading.
I meant to say apples to oranges
I talk to sheeple in my community every day. When we discuss RE prices or the market they say ‘ look at the prices always going up’. They don’t have a clue. When some one drops his price to sell they are ambivalent. Deer in headlights stares are commonplace in Pismo and there are still plenty of FBs waiting to buy here because it is a nice place to live.
Want and ability are very different things. That is where the subprime implosion comes into play.
Here is a social background on Orange County, CA.
Orange County HATES bad news.
For example, prior to the 1990s county bankruptcy the treasurer was up for re-election.
Moorlach (now a supervisor) ran against him warning of the derivative problem in the County’s finances.
Moorlach lost and the incumbent was re-elected. A year later derivatives move against the county and it is bankrupt.
Moorlach is eventually elected treasurer and now is a supervisor.
We hate bad news so much that we sent out county into bankruptcy.
So no news about the housing bubble is just how the natives want it.
“‘They can pay the defaulted payments, refinance, renegotiate (with the lender) and some people do a short sell, where they sell their home at slightly lower than purchase price to avoid the large losses from foreclosure,’ Cagan said.
1. If they coud make payments they wouldnt be behind would they ?
2. They can’t refi if they have negative equity
3. If they have the typical 1st and 2nd Mortgage they can’t negotiate, the 2nd lender has no incentive.
4. You still get whacked in a short sale.
Is this guy living in Happy Sunshine & Unicorns Ville ?
Last fall, my buddy at work said he had a buyer lined up to let him off the hook (albeit a short sale) - but that the 2nd holder would not let him complete the transaction. 1st holder said that the 2nd has final say.
2007 is going to suck.
-Rent
Someone has probably mentioned this before: ‘Cagan’ in Spanish is the third person plural in present tense of the verb ‘defecate’ (cagar). As in “Ellos cagan” (they defecate)’
Let the bailouts begin!
http://www.bloomberg.com/apps/news?pid=20601015&sid=asu8RitVhBIE&refer=munibonds
I wonder how municipal taxpayers feel about having their tax dollars go towards helping those who bought houses they cannot afford fend off foreclosure?
And bailing out the poor lenders. (Wells Fargo, Countrywide, etc.)
Will these bonds be backed by the “full faith and credit” of the State of Ohio?
Wait a minute, what that worth?
Let’s start a pool. How soon do you think those bonds will be rated as “junk” by the rating agencies? My guess is December 2007.
Moody’s and S&P still have the subprime MBS bonds rated as AAA last time I checked.
At least they’re taxable municiple bonds LMAO
I get a feeling that the Ohio state employees pensions will be buying the bonds. This rotten system of ours needs to fall apart so that it can be rebuilt.
Even if the people refinanced out of their ARM’s, wouldn’t the appraisals come in low? I think they are still screwed since prices have come down since the peak.
Maybe the State can sell of some of those rare coins and stamps they bought to come up with the bailout money…
–Shannon
“It will be available to the residents of Ohio to take them out of their adjustable-rate mortgages, their interest-only mortgages and avail them the opportunity to move into a fixed rate mortgage which may now benefit their individual financial situation”
Wow! Also, it looks like Cali may be next!!
“We believe that it is incumbent on this agency to do something to assist these folks to enable them to keep their homes,” Connell said. “A $100 million bond from this agency is not going to solve Ohio’s foreclosure problem. We hope to at least make a dent.”
They are draining the ocean with a teaspoon. They will pi$$ away $100 million to show they did “something”. This, in the long run, will just take away from other programs thus putting more people in a precarious situation. Whatever the government touches turns to crap.
Leave it to a Scottish newspaper to report on the new home for foreclosed folks: their cars –
http://news.scotsman.com/international.cfm?id=457122007
Don’t they have rentals in Scotland?
Do I really need to say it? YCLIYC, BYCDYH
You can live in your car, because you can dye your hair?
Woot, you can live in your car but you can’t drive your house.
By the way, YCLIYC BYCDYH is a googlewhack as of this moment. Soon it won’t be, though, as this thread gets absorbed into the massive google world.
Googlewhack: http://en.wikipedia.org/wiki/Googlewhack
P.S. I saw Dave Gorman’s powerpoint on this. Hilarious.
I love the way those foreclosed on are referred to as “victims”. These are people who don’t even have enough money to rent a room, yet “qualified” for a mortgage? Call it like it is “fraudsters” not “victims”
http://www.econbrowser.com/archives/2007/03/bubble_bubble_t.html
Bit too abstract for my liking. Like engineers who don’t believe a bee can fly because they cannot model it, I distrust Statiticians who over comlicate situations so that it becomes analysis paralysis. I have one at work who I can always find common sense holes in his ramblings.
“First-time homeowner Carmen Rodriguez likes everything about the three-bedroom house in San Pablo she bought in September and shares with her brother. Except for the loan. Rodriguez, speaking through a Spanish interpreter, said the payments on her loan have already increased by a third, rising $500 to $2,000 a month.”
“‘I am very frustrated. I am very upset,” said Rodriguez, whose monthly take-home pay is about $1,700. ‘I have not been able to pay other bills.’”
Absolutely amazing. This woman has a mortgage and “owns” a house in the America, and yet she can not speak english without an intrepreter. You should be required to speak basic english before you are allowed to buy a house in this country.
Hear, Hear. I can’t tell how many times I’ve witnessed closings at a Starbucks or Borders here in SD where there was an interpreter. It’s disgusting that illegals are buying houses with funny money loans and getting away with it. This world has gone completely mad in the past 5-6 years.
Loan closings in a Starbucks or Borders?
WTF?! These people can’t afford to do thier business in a regular office building?? And to illegal immigrants of all people….
“First-time homeowner Carmen Rodriguez likes everything about the three-bedroom house in San Pablo she bought in September and shares with her brother. Except for the loan.”
She was shocked to find out that loans are made with the intention that they will be repaid. How dare they?
“She was shocked to find out that loans are made with the intention that they will be repaid. How dare they?”
She thought everything free in America. Seriously, she probably understands and speaks more English than she lets on. Many illegals do, at least around here. They don’t seem to have much of a problem understanding the social services network and the benefits available to them, because they sure know how to take advantage of all that. But when it comes to a difficult concept like having to pay for stuff or take responsiblity, their English language and cognitive skills take a nose dive. All of a sudden, they turn from savvy parasites to ignorant, innocent victims.
I just love the profound sense of entitlement expressed by illegals.
What kills me, though, is having broken any American law that didn’t suit her convenience…from immigration, to forged or stolen documents, to tax evasion…she has the gall to complain to a newspaper,no less, that she expects American laws to be enforced, to protect her interests.
I wonder how much of the Dodd-Clinton bailout money will go to illegals? Will there be any sort of citizenship-test before passing out the goodies??
That would be racist. Those are hard-working people who deserve all the privileges of citizenship without paying federal taxes
An ugly comment.
I don’t know why it’s ugly. It’s a fact that illegal aliens are milking the social services (silly of the system to have rules that allow it to be milked) and it’s a fact that lots of them get paid under the table and don’t pay federal taxes.
That’s funny, illegals ignore American laws when it suits them, and then expect the law to be on their side when it suits them.Nothing racist about it–just observing criminal behavior.
Goodbye Housing Bubble.
This youtube features David Lereah. Look at the mess he helped to create.
http://www.youtube.com/watch?v=cEs1waa6HT4&mode=related&search=
Awesome video.
I love seeing those stock charts. NEWC was up 29% on Friday. They are still circling the bowl at $2 per share. That is a day trader stock now. Huge daily swings on the pink sheets. Just 6 months ago it was over $50 per share when it was still NEW.
David Lereah is writing a new books. LOL
http://www.youtube.com/watch?v=lPnA1cnewLA
The new book is titled, “This whole thing is going to sh*t”
“‘You didn’t have to verify your income or assets, so we were giving loans to everybody,’ said Downard, who’s been a loan officer for 17 years. Downard estimates that 15 percent of the loans her office did in 2006 were subprime.”
BS liar…
I’ll bet the number of subprime loans was more like 90%.
NO matter what real estate type I talk to–when I ask how much the
buyers are putting down on their purchases, the answer is always nothing.
More disinformation.
Even my brother in law who sold his starter home and bought a mini-McMansion got an 80/20 loan. He used all the equity in his old home to put in wood flooring and buy stainless steel appliances. I warned them several times to take it easy on the spending. At least he doesn’t have any credit card debt - until he bought that 42-inch plasma a few months ago.
Wow.
At least you tried, jerry. But some people just can’t be saved from themselves. If people would only apply the want/need principle (Do you NEED it, or do you just WANT it?)to wood floors, granite, ss appliances, jumbo tv, etc, much of that stuff would not be purchased. Eyes are bigger than stomachs. Once they get full, the stomach ache begins and they are looking around for Tums.
BayQT~
> from 2001 to 2006, home values in the Redding area more than doubled
That should be “home prices”, not values. The price is now retreating somewhat. The value remains the same.
right on
The value remains the same.
How true.
Maybe it should be ” from 1998 to 2006″.
“From 2001 to 2006, home values in the Redding area more than doubled, an unprecedented run-up in appreciation. The rise in real estate was buoyed by a bevy of alternative loan products, including the subprime market…”At the peak of the market, Redding loan officer Sherrie Downard says practically anybody with credit, bad or good, was able to get 100 percent financing to buy their dream home”…‘You didn’t have to verify your income or assets, so we were giving loans to everybody,’ said Downard…”
Anyone still wondering how prices got so out of hand need only read this article. It’s downright disgusting, really. There were literally no standards when it came to home loans. Just a pulse and a signature were required. It’s disheartening that such a blatant scam could take place within this once great country. Even more disturbing is the fact that the president of the country was touting the high rate of home ownership as some sort of grand achievement, all the while ignoring the ugly truth. I struggle to find any positives to this whole debacle.
The federal and state regulators were all looking the other way while these crimes were occurring. Now they want the taxpayers to bail out the criminals.
What is funny is - just a few months ago how many of the financial wizards on CNBC and MSNBC would constantly talk about market fundamentals and how we are in a new period of unstoppable growth. No mention of the disconnect between mortgages and household income.
The positive is that someone I don’t know upgraded my future home for me.
There is no shortage of housing thanks to the bubble.
Yeah it sucks having to wait but knowing I will extract my pound of flesh for having to wait by getting a great deal is worth it.
Look at the comments posted below the article. “Tim” is obviously deep into RE or an agent or both. He’s gettin’ passed around for a deserving slap.
Sorry to change the subject, but has anyone seen any LA RE news today? It seems like we’re getting left out of all the CA articles
Is “no news” good news?
The Minister of Propaganda has banned any articles which might be perceived as damaging to housing demand. America’s future economic prosperity depends on it.
Hey, I haven’t seen ANY articles from Wynot, Nebraska. Why not??
OK, here is another observation from S&M:
Today, I noticed a strange shift while driving around. Many of the For Sale signs in 90402 have disappeared, while 90403 is plastered with them. Generalizing a bit based on the differing composition of these two zips, it looks like the SFH owners have dug in for long haul, but the condo owners have started to panic. This sort of makes sense if you think about it - the last downturn hammered the condos around here, and the SFHs just weren’t on the market.
A friend accepted an offer last week at 10% off their high price. Buyer has 150k to put down. They have another back up offer as well, not as strong. SFH. WLA.
Wow is all I can say. This Sh#t has some legs. I’m starting to feel like lainvestorgirl.
24 months to go in WLA before any serious price reductions. IMHO
This sort of makes sense if you think about it - the last downturn hammered the condos around here, and the SFHs just weren’t on the market.
Doesn’t really matter - when they did eventually come on the market, they too were at steeply discounted prices. It’s inevitable that when the crap (condos etc) takes a 40-50% haircut, the good stuff must eventually do the same. I’m a very patient renter and don’t mind waiting for that eventuality.
Real Estate Cycle? Makes me think that the folks there are in a washing machine that’s in the Spin Cycle, squeezing every drop of assets before leaving them limp in the bottom.
That’s basically it. The decline has to be slow and gradual so that FB’s will go on paying and hoping and waiting and working and paying and hoping and paying for ALAP.
thats where i get my posting name from. im not always agitated but sd is ground zero for nonsense.
“She recalls clients coming in with two car payments, credit card debt and wanting to buy a $400,000 home with nothing down. ‘Everybody was trying to keep up with the Joneses,’ Downard said. ‘You can educate them (borrowers) to do the right thing, but it’s up to them to make the right choice.’”
These people who maxed themselves out on credit and then had the courage to request a $400K loan with nothing down are the modern American heroes. Their spending habits are the fuel which keeps the American economy humming. They embody the cherished American way of life. Our Democratic political leaders should act quickly to protect the Constitutional rights of these guardians of American tradition to purchase and stay in whatever kind of home they wish to own and occupy.
Keyboard Warning:
Some experts believe that typing on any keybaord may cause serious injury. Typing with tongue in cheek may be hazardous to your sanity.
Clearly you’ve been watching:
http://www.youtube.com/watch?v=TxylHPnoloI
‘You can educate them (borrowers) to do the right thing, but it’s up to them to make the right choice.’
—————————————————————
NO NO NO …..Its up to you RealEstateAgent to NOT MAKE THEM THINK, AT ALL….lest your commision walks back out the Door!!!!
Amazing.
Congress just passed a horribly pro-corporate bankruptcy bill and the problem ia American consumers have it too easy.
Democratic political leaders are bailing people out — how exactly ?
It recently got very, very hard for any maxed out consumer to get out of debt but you’re angry at the borrows, and not one mention about the lenders sending out high risk credit.
“Last year, James and Barbara Morgan refinanced their mortgage into a subprime loan in hopes of lowering their house payments. Now the couple worry that the high-risk loan could force them to sell the East Oakland home they have lived in for more than 30 years.”
What is a couple that has owned their homes for more than 30 years even have a mortgage. You would think that after 30 years you they would own their home out right by now. But no, they used their home as an ATM and now worry they may lose their home to foreclosure. This is just one more example why this RE crash is going to be HUGH. It is going to be a long way down. Hold on.
While demand for waterfront property has always been high in Maine, it was traditionally concentrated in the southern and middle part of the coastline. But with the real estate market there saturated and extremely expensive, more second-home buyers and developers are looking beyond Bar Harbor toward sparsely populated eastern Maine, where converting working waterfront into residential real estate was unheard of until recently.
“It’s really just an unstoppable force. It’s something everyone wants,” Tobin Malone, a real estate agent in Rockport, said of waterfront property. “If we’re going to keep the working aspects of the waterfront, it really takes a huge effort and a lot of forethought.”
http://tinyurl.com/224kua
“This is just one more example why this RE crash is going to be HUGH.”
Yes, and another example of why we as taxpayers should not bail them out.
Owned home for 30 yrs AND they are retired on a fixed income.
Is there anyone that thinks the economy of The OC will not get smoked in this? You have Fremont, New Century, Resmae, Impac all headquartered there. In 2004 a guy I know in OC said that OC is the next manhattan, so it is a must buy time like manhattan in the early 90s. Looks like that worked well
How many people know someone who “owns” their own mortgage company?
Raise hands
*raises hand*
raising hand…
Know a couple of them, but one already seems to be out of business.
Soft Pedaling the Housing Market Blues
By Desmond Lachman
Special to washingtonpost.com’s Think Tank Town
Monday, March 26, 2007; 12:00 AM
http://tinyurl.com/2qdtge
From the link:The bush admin is signaling that it wants the Fed to lower FF ratesagain using the American Enterprise Institute, which the bush admin has used in the past to signal it’s intentions…
“If the Fed’s past experience with the bursting of the dot-com bubble is any guide, being tardy in cutting interest rates will only exacerbate the negative impact of the housing market on the overall economy and lead to an unnecessary degree of pain.”
Flooding the world with more dollars may puff up the sagging housing market but it will be at everyone’s expense,. This interest rate debacle has already created the biggest involuntary wealth transfer in history to American homedebtors.
Yale’s Shiller Still Calling for 20-30% Housing Price Declines
Yale economist Bob Shiller says in the weekend issue of Barron’s that he’s still looking for 20-30% housing price declines over the next 5-10 years — including in untouchable cities like San Francisco and New York (and I’ll include Vancouver):
… THE FUNDAMENTAL FACTOR TRIGGERING the price slump ahead is the fact that home prices have risen to levels far above construction costs, says Shiller. Such an anomaly can’t persist for long, even in what he calls superstar cities like New York and San Francisco that boast a paucity of available land and severe zoning restrictions.
Throughout U.S. history, populations generally have moved to areas with lower housing costs when prices become elevated in hot areas. Then home prices reverted to construction-cost levels, even in the once-expensive markets. This, Shiller thinks, is likely to recur.
He gave a speech recently to an executive group at Bank of America headquarters in Charlotte, N.C. Many in attendance were expats from San Francisco, the bank’s old hometown, and they told him they had adjusted to Charlotte just fine after being uprooted from every American’s dream city. Clearly, migration remains the big leveler in real-estate markets.
http://paul.kedrosky.com/
“Yale’s Shiller Still Calling for 20-30% Housing Price Declines”
Either he is being precautious, or else he is talking of nominal, not real declines. Because once lending standards revert to historic norms, 40%-50% real declines seem more likely necessary to absorb bloated McMansion inventory and realign home prices with incomes.
“Clearly, migration remains the big leveler in real-estate markets”.
Migration into Portland, ME has made prices go crazy. But to a New Yorker or a Californian, a 4,000 square foot high end house in a fancy area right on the ocean for under a million dollars seems a bargain.
REIC propaganda is alive and well in the San Diego Onion Tribune. Check out this piece. The subliminal message: You have to either leave town or live in a cramped condo forever; only really rich people in San Diego get to live in houses. But what about renting? No mention of the fact that you can rent for 2/3 the monthly cost of owning, with no risk of catching a falling knife. And the innuendo that only condos have been built in recent years ignores thousands of SFR McMansions that have been constructed since Y2000, against a backdrop of massive urban exodus of the kind of families that might have chosen to live in these places if it were not for the bubble price blowout. Now we have a growing inventory of McMansions on the MLS, with countless others that have never been occupied which are somehow ignored by the SD Onion Tribune REIC propaganda.
———————————————————————————-
Keeping the dream alive
With higher housing prices and less land to build on, building planners are thinking about smaller solutions
By Emmet Pierce
UNION-TRIBUNE STAFF WRITER
March 25, 2007
The dream of owning a house – one of the most cherished of American ideals – is fading for many middle-wage households in San Diego County.
Confronted with a lack of buildable land, astronomical housing prices and newly tightened lending policies, those wanting a house of their own are caught in a cultural and economic shift dictating where and how they will live.
They can move to Riverside County, where prices are lower but the commute is longer. They can leave the state, as thousands have done.
PEGGY PEATTIE / Union-Tribune
Nearly 70 percent of the new homes sold last year in San Diego County were townhouses or condos. With less land available, developers are doing infill projects such as the Egyptian condominiums at Park Boulevard and University Avenue in Hillcrest.
Or they can stay, and downsize their housing expectations, analysts say.
It’s a change that is reshaping the nature of homeownership here, even as housing prices pull back from their historic highs.
Some first-time buyers are postponing or even abandoning their goal of owning a single-family home, said Steve Doyle, president of Brookfield Homes’ San Diego region. Houses “are quickly becoming unaffordable. They are not realistic, not for the teacher, not for the fireman, not for the nurse.”
Certainly, not everyone in the middle-wage bracket has been priced out.
Those who were lucky enough to be homeowners were thrilled by the huge gains in equity they amassed when residential values in the county doubled between 2000 and 2005.
MODERATE INCOMES BY THE NUMBERS
In San Diego County, these annual levels are considered “middle income”:
$48,601: for a single person
$55,499: for a couple
$69,400: for a family of 4
$80,521: for a family of 6
SOURCE: U.S. Department of Housing and Urban Development
But at the same time, thousands of prospective first-time buyers were being locked out of the single-family market by a widening gap between their incomes and the rapidly escalating house prices.
The disconnect has created a real estate economy often described as “out of whack.” While San Diego County long has been one of the nation’s least-affordable housing markets, what’s new is that the type of homes being built is changing.
Sixty-nine percent of new homes sold last year were condos and townhouses – “attached product” in real estate terms. “That is the future for San Diego,” Doyle said. “Is it good? Is it bad? I don’t know.
http://www.signonsandiego.com/news/metro/20070325-9999-lz1n25dream.html
As if San Diego’s home owners did not already have enough problems on their hands, they are about to lose their fifteen-year-old efficient toilet subsidy
————————————————————————————
Thousands vouched for it
Toilet discount program to end after 15 years
By Carl Larsen
HOME EDITOR
March 25, 2007
A program that has saved San Diego County homeowners millions of dollars over its 15-year life is … well, what else can you say – going down the toilet.
On March 31, the San Diego County Water Authority will end its long-running voucher program that has given homeowners discounts on the purchase of ultra-low-flow or high-efficiency toilets, as well as helping cut their water bills. A companion program for multifamily dwellings that is aimed at landlords and one for builders will continue.
http://www.signonsandiego.com/uniontrib/20070325/news_lz1h25toilet.html
The original Crappy Deal.
Forget the toilets, have you driven on the roads around here recently. I know we all like to joke about SD “homeowners” and their hummers, but these wise folk may be onto something.
A typical day in the life of the California legislature…
————————————————————————————
Lawmakers to tackle sperm washing, subprime lending, smoking bans
The Legislature has a busy week ahead:
* State Sen. Carole Migden is pushing a bill that would allow HIV-infected men to use advanced reproductive technology to “clense” their sperm of the virus and impregnate their uninfected partners.
California law currently prohibits inseminating a woman with HIV infected sperm, but medical advances have produced a way to remove the virus from the sperm. The process involves spinning the sperm in a centrifuge to separate components of the semen and using a solution to remove the virus.
Migden says sperm washing will “substantially reduce” the chance of HIV transmission and that studies have yet to find an instance of transmission when the new laboratory methods are used.
S.B. 443 will come up in the Senate Health Committee on Wednesday.
* The Senate Banking Committee on Monday takes a look at how the wheels are coming off the subprime lending business and how it’s affecting the California economy.
“Borrowers are losing homes and subprime lenders are closing their doors every day,” said Paul Leonard, director of the Oakland-based California office of the Center for Responsible Lending.
* Smoking bans are being considered for state beaches and in cars when children are passengers. SB 4 deals with butts on the beach, while SB 7 deals with second-hand smoke in cars.
http://www.sfgate.com/cgi-bin/blogs/sfgate/detail?blogid=14&entry_id=14686
“* Smoking bans are being considered for state beaches and in cars when children are passengers. SB 4 deals with butts on the beach, while SB 7 deals with second-hand smoke in cars.”
We need a new SB that deals with giving loans to people who don’t qualify for them.
Californians,
\
Are you as racist as your many posts suggest…against “Mexicans”?
If so, why do you LOVE to use “Spanish” names for streets/subdivisions, etc.?
Just wondering.
Here may be your answer.
http://www.ocweekly.com/columns/ask-a-mexican/ask-a-mexican/26890/
We aren’t racist. In fact, we keep using Spanish place-names because we’re on the fast track to become part of Mexico, and we want everything to transition smoothly.
If you come to visit us, don’t forget your phasebook!
First of all this is a housing blog. Emotions run high at times, and occasionally stray from the subject, but labeling people as racist simple because they don’t share your point of view shows a serious lack of understanding and political correctness. This country is an incredible mix of peoples from all over the world who call themselves AMERICANS. Those who come here to take advantage of our system while having no sense of loyalty to this country, people who do not consider or call themselves AMERICANS, grate on some AMERICANS. This is a free country, and I for one don’t appreciate being labeled as a racist simply because there are some people who are in this country illegally that never plan on becoming AMERICANS who I would rather see leave.
As for Spanish names, this state has no problem with its Spanish heritage. After all, it was only a Mexican Province for 25 years before it became golden.
“Californians, Are you as racist”
Yes. I hate all races.
Especially the race of ‘internet trolls’.
Hey, Boombust…
Are you a retard?
Just Wondering….
boombust,
Actually, the illegal invasion is very much related to this housing bubble. While illegal immigrants seem to have no problem living 25 to a **single-family** house, and using 100% LTV mortgages, many of the **native** Calfornians have been priced out by those **who do not come from here**. Give up the whole “California is Mexico” propaganda. The “Mexicans” who were in CA when it was Mexico still have their decendants here. They were not forced to leave (please correct me if I’m wrong).
As another poster stated, Mexico had a very short history in California. Spain, OTOH, had a much longer history in CA, and is responsible for the “civilization” of California.
My guess is that the Spanish names are derived from the former SPANISH occupation & control of California. The Spanish are European. Native Mexicans are Indian/Native American, and their native language is NOT Spanish.
If we are racist, are we supposed to be racist about the Native American or Spanish in California?
……………………..
Bottom line, illegal immigration sucks resources out of our country, and does not fairly compensate for those losses. It (and globalization, in general) is causing the demise of our highly-valued middle class.
While there are legitimate reasons for Mexicans wanting to come to the U.S., their problems need to be solved IN MEXICO. If Mexico ever got its act together, you’d be surprised how fast this whole “racism” thing would blow over.
Fix the cause of the problems at their source. Do not expect others to continuously compensate for other’s lack of responsibility.
I see this though it seems a bit exaggerated…. I’m no longer in SoCal but every time I go back, the “Mexicanization” seems more entrenched.
However…
What the OP was objecting to is something I find really disturbing also — that on this blog, any person with a “Spanish” surname is automatically assumed to be a non-citizen illegal immigrant. Is that racist? I think so…
“First-time homeowner Carmen Rodriguez likes everything about the three-bedroom house in San Pablo she bought in September and shares with her brother. Except for the loan. Rodriguez, speaking through a Spanish interpreter, said the payments on her loan have already increased by a third, rising $500 to $2,000 a month.”
“‘I am very frustrated. I am very upset,” said Rodriguez, whose monthly take-home pay is about $1,700. ‘I have not been able to pay other bills.’”
Estupida!.
I am very frustrated & upset too. Upset at seeing the way subprime lenders have now found a whole new pool of such eager first time FB’s that’ll help them keep the RE Ponzi scheme going. And pardon my garden for saying so but; if you’re not here legally you should NOT be buying real estate here either. The Mexican government sure as hell doesn’t allow us to buy any RE there. They only allow ‘arrendamientos’ or Long Term Leasing. And even that’s allowed only within certain areas.
Reading about so many cases recently such as Carmen’s up above confuses me tho. I just don’t get it. On one hand I hear that subprimes (the remaining ones at least) are tightening lending standards yet on the other I see that these liar loans seem to be accelerating and picking up pace. They’re still plugging ‘em on Spanish TV ‘a lo loco’.
Is there NO end to this madness?.
According to Bloomberg, Ohio is taking steps to bailout FBs:
March 23 (Bloomberg) — Ohio, which had the highest foreclosure rate among the 50 U.S. states at the end of 2006, plans to issue $100 million in taxable municipal bonds next month to help homeowners refinance mortgages they can’t afford.
http://www.bloomberg.com/apps/news?pid=20601170&refer=special_report&sid=asu8RitVhBIE
If Shiller’s estimate 20 to 30% price adjustment over 5 to 10 yrs is correct - that will be a best case
The american economy will have dodged another bullet - perhaps a supe depression avoided or deferred
The primary good news on the U.S. economy that might save america is the fact that approx 1/6th of the world’s population (India and China) are emerging as (modified) super-capitalists - primary in engaging in some version of american style capitalism at least in major parts of their economy
Americans may be spoiled, living beyond our means, and real estate is a bubble -however capitalism (to the extend its allowed) - seems to unchain alot of talent that pure socialism just destroys
Unleashing the most productive individuals and businesses seems to work pretty well longer term
“Lenders knew the risk of loaning money to poor-credit clients. But they thought it was a safe bet, especially at the rate houses were appreciating.”
Classic Ponzi thinking - however this blog along with the predecessor bubble blog had this issue down cold, so there is no surprise here
It’s tough to say what will happen to LA. There are STILL alot of idiots out there ready to pay $699K for a2 bdrm 12sqft new condo right at the exit of HILL AVENUE in PASADENA….I mean the freeway sound is intrusive even with double-payned glass. Believe it or not, there were sold units there….who the fk is buying this crap?? What would possess people do this and where are they getting their money??
I don’t get it…and then you have a 13 sqft OLD home in Glendale near Glenoaks going for $829K. I couldn’t stop laughing.
If it goes on like this, you’re going to see alot of rich poor people here. This shit defies all logic…
People in California are all millionaires…..don’t you know? Everyone makes 150k or more in salary. Some are multi-millionaires that don’t work….just let the interest keep rolling in to live on…What are you doing wrong? you aren’t living in California….where if you buy a house you could be a millionaire in 5 years….=)
That’s the thing, making $150K in California is not much anymore. Honestly it isn’t. It seems like a lot with respect to other places, as I am sure it really is. But here…no.
That’s why I don’t understand why Mexican immigrants are coming here. Their quality of life and struggle is far harder here than were they to go somewhere else. I can see that many of them live with each other amongst large families…but what the hell is the point? Even “local” people now have to resort to doing that now.
That’s why it makes me laugh when people here on this thread get all upset when it’s clear leaving here is the best thing to do. As I expected, they can’t even offer reasons to stay.