Buyers Sift Through The Choices In California
The Mercury News reports from California. “It wasn’t until a bank rejected his application for a credit card that Kulwinder Singh checked his credit report and found out he owed $579,000 on a San Jose condominium that he’d never seen. Worse, the condo was facing foreclosure and his credit was in ruins.”
“Singh, who admits he agreed to sign as the condo’s buyer in exchange for $2,500, is one of several people who have told the Mercury News that they wound up with mortgages and property in foreclosure after allowing their credit to be used to help someone else buy a home.”
“In a written complaint to the San Jose Police Department, Singh reported that he agreed with two agents to accept $2,500 for ’signing a house under my name’ last May while working at Century 21 Su Casa’s Fremont branch office. He told police he was promised that his name would be removed from the property a month or two later, that the home would be transferred to the real estate company and that they would be ‘responsible for everything.’”
“Public records show that Singh bought a condo in San Jose in May 2006, borrowing the full purchase amount of $579,000 from a subprime lender. His initial payments were to be $4,780 a month. He paid $30,000 over the asking price, according to the listing agent’s Web site and real estate records.”
“Singh’s loan application, prepared by Mariposa Mortgage, claims he is 20 years older than he is, earns $12,500 a month as ‘co-owner/manager’ in Newark, a job he supposedly held for 2 1/2 years, has $24,000 in a savings account, $8,500 worth of jewelry and $19,000 in other assets and drives a Toyota Tundra truck worth $37,000.”
“Singh said that after asking Fremont Investment & Loan for the documents, he was surprised to see those claims on the loan application, though he signed it at the time.”
“‘I’m like, God, I don’t have any of this. And $24,000 in my account? That’s completely insane,’ Singh said in an interview.”
“When Singh learned in December that he still owned the property, he investigated. He sneaked in, went upstairs and knocked on the door of the unit his credit report said he owned. There was no answer. ‘There was mail under the door, addressed to me, from Fremont Investment bank saying you haven’t paid your money,’ Singh said. ‘I was like, ‘Whoa.’”
“Foreclosed on in March, Singh’s condo is for sale again for $509,500, nearly $70,000 less than he paid.”
The Record Searchlight. “Mirroring the rest of California, Shasta County home sales dipped deeply in March compared with the same period a year ago, DataQuick reported.”
“In Shasta County, the shift that started last year from a sellers’ to buyers’ market has taken root, Redding real estate agent Brad Garbutt said. ‘It takes time for things to show up in the stats,’ Garbutt said. ‘There’s a slowdown in sales activity due to the subprime market implosion.’”
The LA Times. “It’s hard to imagine a metropolis here. Not far from 13 pristine model homes, some with bathrooms the size of studio apartments, cows munch hay near a potholed two-lane road. There’s a stench of manure in the air.”
“When the model homes open to the public for the first time today, Adrian Foley, the president of Brookfield Homes Corp.’s Southland operations will have his expectations in check. ‘I’m a realist,’ Foley said. ‘I acknowledge that the pool of buyers today doesn’t appear to be as big as it was a couple of years ago.’”
“In March, sales of existing homes in the city were down 59% from the same month last year, according to DataQuick. The median sale price fell to $408,000 from $425,000.”
“On the other side of Riverside Drive from the New Model Colony, ‘For Sale’ signs sprout from a lot of lawns. The value of undeveloped land, much of it still home to cows, has fallen by as much as $100,000 an acre in this part of San Bernardino County in the last six months, land brokers estimate, settling way below the peak of $550,000 in 2005.”
“‘Before, if a dairyman even hinted he wanted to sell his land, he would be inundated with offers,’ said David Beno, a partner with Ontario brokerage firm Beno, Van Dyk & Owens. ‘Now it’s pretty hard to find someone who would close a deal.’”
“The unemployment rate last year was 4.6%, the lowesteconomist John Husing has seen since he began studying the area 42 years ago.”
“But many of the new jobs won’t pay the sorts of wages necessary to buy a house in the New Model Colony. ‘Prices have been pushed way too high for incomes in that area,’ said economist Christopher Thornberg. In 2005, the last year for which he has statistics, only about 25% of the households in the Inland Empire had incomes that could support a $500,000 home.”
“Ike Bootsma, whose dairy farm fetched more than $525,000 an acre when it went on the market in 2004, wants to sell 20 acres that his family has owned since 1938. Bootsma sealed a deal with a developer in 2005 for $515,000 an acre.”
“When land values began to tank, the developer, who had already made a few payments, triggered a clause in the deal that allowed for a price adjustment, and asked that it move down to $375,000 an acre.”
“Bootsma decided not to sell and now rents out the land. He figures it will be more than seven years before prices will climb to where he wants them. ‘If the right offer comes in,’ Bootsma said, ‘we’ll sell it anytime.’”
The Orange County Register. “Expect the housing slump to continue at least through 2008, building industry officials said Friday. The year 2008 ‘won’t be so great,’ said Les Thomas, president of Shea Homes Southern California. ‘We hope things will be fine in ‘09.’”
“About 40 high-rise condo projects in the Irvine Business District have ‘ground to a halt,’ said Mac O’Donnell, CEO of the Irvine brokerage O’Donnell/Atkins.”
“Condo tower builder Opus West Corp. will only develop one residential high-rise a year in the next three to five years, said Matt Montgomery, Opus West’s director of real estate development. ‘I don’t see a whole heck of a lot of (construction) in the next five years,’ Montgomery said.”
“‘There still are deals out there,’ said William Shopoff, founder of an Irvine investment firm. But, he added, deals are earning 25 percent to 40 percent less than what they generated 18 months ago.”
The North County Times. “A member of Riverside County’s governing panel wants the county to set up a resource center for homeowners facing foreclosures, which have increased dramatically in the last year.”
“Foreclosure-related filings rose by 94 percent to 6,879 in Riverside County, according to RealtyTrac.”
“‘There is a crisis out here,’ said Rose Mayes, executive director of a nonprofit group. ‘There are people losing their homes at an alarming rate. Some of these people will never again be able to purchase a home.’”
The Press Enterprise. “In yet another sign of a continuing Inland housing market slowdown, the percentage of homes sitting vacant and waiting to be sold rose to 3.9 percent in the first quarter, well above 0.8 percent a year ago, according to newly released government data.”
“Earlier this week, a report by the Multi-Regional MLS, showed there are more than 34,700 Inland homes listed for sale. That’s the highest level in eight years.”
“The length of time those houses stay on the market has almost doubled in the past 12 months, the report showed. It would take 13.2 months to sell the supply of resale homes, up from 6.9 months a year ago.”
The Desert Sun. “Sales volume for all types of homes in the Coachella Valley declined 37 percent in March from a year ago, with new-home sales experiencing a particularly soft month with nearly a 53 percent decline from March 2006, DataQuick reported.”
“In areas of the valley where homeowners compete with new-home builders, eager sellers are increasingly willing to negotiate, real estate agents said.”
“The valley’s sluggish new-home sales market has prompted some new tactics, including auctions. Home-builder Lennar recently turned to (a) Web site to auction off homes and condos in Indio, La Quinta and Rancho Mirage. On Friday, for instance, RealtyBid fielded bids for homes in the Marquesa at Terra Lago community in Indio. Lennar homes there originally priced at $459,990 were getting $296,000 to $318,000 bids in an auction scheduled through May 8.”
“The valley’s home inventory has steadily climbed to nearly 9,200 homes by mid-April, up from 7,467 in April 2006, CDAR reported.”
“A general scarcity of buyers means they’re increasingly in a strong bargaining position and can take their time to sift through the choices. So it took an average of 103 days for a home to sell in the valley between Jan. 1 and March 20, compared to 77 days a year ago, CDAR reported.”
“The increasing number of delinquent mortgage payments and possibility of eventual foreclosures that could result in bank-owned properties becoming a bargain has some prospective buyers holding off, said Realtor Carlo Lombardelli, who has been working with clients for nearly 18 years in the valley and has ridden out many local real estate market cycles.”
“‘I don’t think we’ve seen the foreclosures and short sales fully manifest themselves as of yet,’ Lombardelli said. ‘I think we’re going to see the impact over the next six to 12 months.’”
From the L.A Times article:
“There’s a stench of manure in the air”.
That’s not cow crap you smell, it’s the real estate agent.
lol
Welcome to today’s episode of Amazing Realtor Stunts.
In today’s episode we learn that a flipper recently listed a POS Cape at $1.5M.
After the realization that no suckers were willing to pay $1.5M for a Cape, did the realtor:
A) Instruct the seller that the POS Cape was stratospherically overpriced.
B) Update the MLS photo so it no longer depicts the tiny Cape, and instead shows only the front door of the house.
You are correct, the answer is B. Thanks for playing.
http://www.dianenewmanrealtor.com/asp/homes/2731%5C516122_5841987.jpg
http://www.census.gov/hhes/www/housing/census/historic/values.html
check out the numbers for the 90’s- housing data
You the posted 2000 dollars page.
I am more partial to the actual dollars for those periods.
The drop in CA housing from 249 to 210 is impressive but
1940 looks like 46000? when it is much lower in 1940 dollars.
No one had 2000 dollars in years such as 1990 or 1940!
Why? The data may look “impressive” but nominal amounts are worthless for comparisons. You need to factor in inflation to determine if there is any real change in the value (or perceived value) of a product. Otherwise, you are just using the numbers for a horse race, as opposed to real investing.
Personally, I am shocked just to see how low 40s prices were in 2000 dollars. You could buy the median house for 30k in 2000 dollars? That’s incredible. No wonder everyone thinks housing is such a great investment. Does anyone think we will ever see those days again?
It might be especially illuminating if this was in terms of $/sq. ft., so that we could see how much of the real 1940-1990 increase is due to changes in house size and how much is really appreciation beyond inflation. I have heard that the ratios of annual income to house prices was much closer in 1940 (for instance, the majority of college educated 30-40 year old workers earned under $2500/year in 1939).
Here in Santa Clara County 50-60 yo 800 shoe box sold for under 50K in 1979′ it was around 75K in 1993-6 and now 500K in 2007.
Good find! Check out CA:
Median home price in $2000:
California
2000: $211,500
1990: $249,800
10-year real median decline: 15% (and that was 3 to 4 years after real estate took off around 1996-1997).
For another clue into the true health of the RE market, check out “‘Up’ Zips” at:
http://www.viewfromsiliconvalley.com/id325.html
Thanks!
Another great article from vfsv
Thank You
Stucco, your comment about the real decline is apropos, especially the observation that prices had already taken off in 1997. Somewhere I’ve heard that the real decline in Calif RE in the early 1990’s was 40%.
Ontario is a large, large IE region: 90 % of it’s land area is either open pastures or industrial/warehouse operations. Humongous warehouses several city blocks long with hundreds of trucks lined up scattered all over Ontario. It is basically a gigantic warehouse/truck distribution region, nothing is manufactured, and all the jobs are in warehousing/forklifters/trucking.
Most jobs of this type pay working class.non-union wages of $10-15/hr: Class A drivers make average 600-700 a week but work/income not steady.
This New proposed EdenGlen/New Model Colony Development, along with the establishe Creekside Community, are pretty much hemmed in by the warehouse/smelly cow fields. Ontario is flat, featureless, and hot as hell 8 months of the year, and the surrounding area nothing but deadly-dull commercial/industrial warehouse zones. Amy idiot paying $500,000 for homes in Ontario is simply nuts.
I find it hilarious that the developers always try to give their developments some strange, subliminal names. EdenGlen- supposed it conjure up an idea of eden; sounds more like hell to me. Or worse, Bakersfield.
Ontario is a hot, miserable, smoggy, dusty region, and devoid of any recreational activities or decent parks. It is virtually treeless, featureless, and basically a ggantic warehouse transhipment center for all the chinese-made wallmart crap imported thru the LA ports and routed thru Ontario/The IE. Some of the biggest warehouses in the US are in Ontario.
This Particular development, EdenGlen, is misnamed. It should be called Smogsville or IEfrypan or Cowpatty or dustyglen. It is Anything but Eden out in this particularly Mis-located IE exurb located just off the 15/60 fwys, which see 1 million diesel big-rigs passing thru yearly, spewing out truck-exhaust pollutants. Bet there will be high incidents of asthma and other COPD disorders for these residents.
I read an article that thought developers named their developments after the things that were displaced by the development: Fox Run, The Oaks, Silver Meadows…..
What kind of idiot signs a loan doc in exchange for 2500 to “let someone else USE his credit???????” Im blonde but God help me on my worst day I have more send than that! What the heck? Were these condos just sitting there after closing? was this just to sell them and get the builder or the agent off the hook??? Im reeling from stupidity!!!!!!!!
Are these the kind of people we’re supposed to bail out? The moron owns the condo fair and square, and the consequences are his to deal with.
Lawyers on this blog would know, but isn’t this fraud and isn’t Mr. Singh liable not only for the mortgage but for criminal charges for participating in a fraud? Is the check he took for 2500 enough evidence enough to get him convicted?
LMAO,
Went to a see two model homes on a small lot in Stockton. Walked in two salespeople, hungry… followed us through both homes all nervous like. I asked how many they were puting on the lot she said 105, haha I was thinking maybe 60-70.
Get this,
They were 4 or 5 bedroom 3 story homes 1,300-1,400sqft. With “cosmopolitan low maintanence back yards” HAHAH, no back yard at all. She said they they had a few with backyards either 5 or 10 feet deep!!!
shitty for 310k+
You turned down $375,000 an acre, in the i.e.?
Boot to the head, Ike Bootsma
Boot to the head! I used to think you were kinda obnoxious, A-lad, but now I love you! Boot to the head! Yeah, yeah. Boot to the head!
I wonder what Dr. Demento would make of this housing nonsense.
Heard he invested heavily in Pico & Sepulveda.
“In a written complaint to the San Jose Police Department, Singh reported that he agreed with two agents to accept $2,500 for ’signing a house under my name’…(and is now foreclosed)”
The “cockroach theory” applies here. If you see one, there are many more to still be discovered.
Could he get any dumber?
I wouldn’t let my own mother use my name and credit to get a house.
Pass the popcorn.
$579,000 on a San Jose condominium
more like 115K for SJ Condo based on inflated adjusted basis.
they are selling homes 500-600K that so dinky and nearly 60 plus years old.
Baby boomers going bankrupt at faster rate
http://www.msnbc.msn.com/id/18335371/
New York- Americans over the age of 55 are filing for bankruptcy at a faster rate than the general population as growing mortgage debt and higher health care costs make them more vulnerable, a new study shows.
I think some people use BK as a strategy, just like businesses.
I assume that the San Jose Police Department immediately arrested Mr. Singh for fraud.
What a dumb****…
Unbelievable, this guy was an accomplice in mortgage fraud and now he has the nerve to go to the police because he was taken too.
Like they say, you cant con an honest man.
you can’t make this stuff up!!!!!!!!
“In a written complaint to the San Jose Police Department, Singh reported that he agreed with two agents to accept $2,500 for ’signing a house under my name’…(and is now foreclosed)”
This is like people who call the police to report their marijuana plants stolen.
He was a realtor working with these people in the same branch from the article…now the snakes are feeding on themself. SJ Santa Clara RE is a snake pit.
I hope Mr. Singh enjoyed his $2500 new found wealth. He should also enjoy the 1099 that will come with a short sale if it is even allowed. He should also enjoy his freedom while he still has it. Too bad about your new FICO score Singh.
I almost feel sorry for Mr. Singh. If I were on his jury, I would vote to give him only 5 years instead of say 10 years for this fraud.
No sympathy or empathy he knew….
Shame he’s not in New York. The jury could send him to Singh Singh.
(Sorry)
Mr. Singh got singhed.
And under the flashing blue light, k-mart shoppers:
“There still are deals out there, said William Shopoff”
I don’t know why he ran to the cops, he is on the hook for conspiracy to commit fraud.
If he gets his bid in early, he might be able to turn state’s witness on the other perps and save himself a long sentence. Maybe even get probation.
well he most likely didnt report the 2500 as income to the IRS.
the IRS wont be so kind regardless how much he may help the police.
“…he agreed with two agents to accept $2,500 for ’signing a house under my name’ last May while working at Century 21 Su Casa’s Fremont branch office.”
…while working in a RE office. Now that’s funny.
There’s that pesky FMT in the news again. Wonder what their new auditor is going to find, LOL.
I think this was a Century 21 RE sales office in Fremont, CA.
And all this time comparables have been tainted on other sales for all other homes in that area which also spread to other regions like the plague. The whole county is plagued with fake bids and all other kinds of fraud.
Fremont Investment and Loan was the sub prime lender. They are now under a cease and desist order from the Feds for any residential home loans. That is half their business. Guess what the other half is? Large condo highrise construction loans. Only Scooby Doo can call this one: “Ruh Roh”.
“…he agreed with two agents to accept $2,500 for ’signing a house under my name’ last May while working at Century 21 Su Casa’s Fremont branch office.”
Su Casa, Mi ruined credit. ROTFLMAO.
SS,
Great line!
As this market implodes, I feel we are all going to get years of entertaintment watching these FB’s go bankrupt. This will help make up for the last 5-6 years of stupidity,fraud and greed that was allowed to exist in RE.
Don’t worry, this thing is so toast. GSE’s, Banks, Congress, and SLG’s will give lip service on solutions, but we are headed for a lengthy recession (we are already in recession by the way). Live simply, save, and invest in non-dollar currencies. This country will be getting a much overdue enema!!
Poetic justice.
Yeah, this hooligan is like the kid that kills his parents then asks for clemency because he is an orphan.
“Singh’s loan application, prepared by Mariposa Mortgage, claims he is 20 years older than he is, earns $12,500 a month as ‘co-owner/manager’ in Newark, a job he supposedly held for 2 1/2 years, has $24,000 in a savings account, $8,500 worth of jewelry and $19,000 in other assets and drives a Toyota Tundra truck worth $37,000.
Singh said that after asking Fremont Investment & Loan for the documents, he was surprised to see those claims on the loan application, though he signed it at the time.
‘I’m like, God, I don’t have any of this. And $24,000 in my account? That’s completely insane,’ Singh said in an interview.”
******
No wonder Bay Area house prices are so high.
Lying on applications, payoffs for identity/credit and incredibly foolish dupes.
Not our proudest moment around here.
Is it too late to coin the term, “It’s the fraud, stupid”?
GMAC just foreclosed on a house in Stockton. There is so much fraud in the neighborhood, it is impossible to tell where the values really stand. GMAC’s own appraiser pegged the value at $620,000. Here is the funny part: the builder is selling the same exact house for $485,000 right out of the model around the corner. There are so many cash back mortgage fraud deals with Option One, Fremont, New Century, etc in the last 3 months, the appraiser thinks the fraud deals are the market now. If only he visited the builder’s model 20 houses away….just a little due diligence is all I ask.
How can so many idiots get in charge of lending so much money?
By the way, GMAC foreclosed on a $554,000 principal loan with a 10% $55,400 second behind it. They will be lucky to sell for $450,000. They will lose about $200,000 on the loan after all the carrying costs, selling costs, foreclosure costs and a market that declines 1% monthly. Cerberus better have a good accountability provision for loan losses. It has only just begun and it will get much, much worse.
The market value for a house is what someone is willing to pay for it. Hold an absolute auction and you’ll soon discover what the properties dollar value.
Of course realtors hate to do this because…
1. They don’t get a cut of the action. (The auctioneer does.)
2. You can’t sell to some uninformed idiot at an auction. Even the idiots tend to pick up an whats going on while talking to other buyers.
3. You can’t forge/fudge the paperwork
Dont forget fake bids you cant verify.
You can get around the “fake bid” problem by requiring a 5-10k refundable deposit. If the high bidder doesn’t buy the auctioneer takes their deposit and calls the second highest bidder.
Did you say Cerberus Investments?
“Currently, Dan Quayle is Chairman of Cerberus Global Investments, LLC (Cerberus)”
Can you spell potatoe?
Kaylaw no….. that’s the 1st post of it i have seen!
A few bad apples, that’s all…I have to admit, the fraud stories are my favorite.
Fraud just pushes the buying horizon out that much farther for me. I wonder if anyone buying ever asked to have the comps checked for fraud? These REtards are boning themselves by not getting their data cleaned up, imo.
Maybe it’s like dimedropped explained when he said people pulled $n100k out of some POS and it was done - lender stuck with it. Houses as condoms - use ‘em and toss ‘em.
“I have to admit, the fraud stories are my favorite.”
This is the line that killed me:
“‘I’m like, God, I don’t have any of this. And $24,000 in my account? That’s completely insane,’ Singh said in an interview.”
Out of everything that’s completely insane about that entire scam, the concept of having $24,000 in a bank account is the one he names in particular!
Who are these people? From what universe have they come crashing into Reality? Are these the people that live inside TVs, and how did they get out?!
These are the Pojama People that Frank Zappa sang about. Wandering through life with “cozy little footies on their mind.”
The very ideas of saving money, acting responsibly, or thinking for themselves never crosses their minds.
“Some people’s hot
Some people’s cold
Some people’s not very
Swift to behold
Some people do it
Some see right through it
Some wear po-jamas
If only they knew it”
LOL, how about this from Zappa’s “America Drinks and Goes Home”:
Do your job
Do it right
Life’s a ball
TV tonight.
Zappa and Vonnegut. How I miss them.
Been going on for the past 7-8 years in Santa Clara County. Its been 24/7 nonstop fraud. Its only now that the prices are declining that all snakes are surfacing. We will be hearing more fraud stories coming from Santa Clara County RE market.
Did all these fraud perpetrators think that they could get away with it because prices were climbing up non-stop? Possibly some did not care about getting caught, but I figure alot of them just believed that higher house prices would make up the difference. Likewise,do you think all the custodians that took over the failing lenders did not have a clue of all the rancid pork loans coming to roost?
What I seen … fake multiple bids.
How do you prove in the courts?
They shred the documents or dont document who bid what
of course its all fake …
Therefore no evidence no case no charges
LOL. I thought much the same.
Oy, Cal-ee-forn-ya is going to take it in the shorts.
we’ll need work camps
too many apples
“A few bad apples, that’s all…I have to admit, the fraud stories are my favorite”.
this story has my attention and im giddy!
“A few bad apples, that’s all…I have to admit, the fraud stories are my favorite”
im down right giddy about this story.
“I wonder if anyone buying ever asked to have the comps checked for fraud?”
I guess nobody wanted to know. I worked on some statistical models for one of the agencies in the mid 90’s, attempting to get computerized appraisals to check for the already infamous cash-back appraisal fraud, which they already suspected was common. The lazy-appraiser syndrome (i.e. find out what is being asked. Voila- that is the appraisal) was also well-known even then. In a rational world, the lenders would get a second opinion or at least do a careful computer analysis on all appraisals. But fraud was just greasing the wheels of the gravy train…
Just like the dotcom plosion things are surfacing on a scale and brazeness people had NO CLUE AT ALL were happening.
I never heard of half these crazy companies till they imploded. Its like when Enron/Worlcom/Excite@Home all when under at the same time with FAKE PROFITS all over thier books.
Instead of asking - what will be the next bubble ? - We should ask - How will the herds of sheeple be fleeced next??
It will probably be a long time until the wool grows back for there to even BE a fleecing.
The really funny thing that struck me is the biggest thing he is worried about is his credit.
LOL, it’s straight out of the movie Brazil (”Don’t hold out too long son — you may jeopardize your credit rating.”)
ere I am, J.H.
Yes, quite a few people are going to collapse into a steaming pile of aspic-with-bones…
“Singh’s loan application, prepared by Mariposa Mortgage, claims he is 20 years older than he is, earns $12,500 a month as ‘co-owner/manager’ in Newark, a job he supposedly held for 2 1/2 years, has $24,000 in a savings account, $8,500 worth of jewelry and $19,000 in other assets and drives a Toyota Tundra truck worth $37,000.”
“Singh said that after asking Fremont Investment & Loan for the documents, he was surprised to see those claims on the loan application, though he signed it at the time.”
Looks like we can use that cow pasture to build a giant prison to hold the 1 million people that need to go to jail over this coming crash.
Now wait ,didn’t the article say that this guy worked for the real estate company ? I think this guy is trying to play victim when he knew darn well he was a straw buyer . The fact that the crooks stuck it to him is what happens when you play with the criminal element .He might of figured that $2,500.00 was good pay to only use his name for 2 weeks . The guy saw the fraud on the loan application .
Casey is another creepy punk criminal who talked sellers into inflating appraisal so he could get cash-back yet he wants people to bail him out .
If someone robbed a liquor store for the kind of money these real estate crooks are stealing from the system you would have cops working night and day to get them .
What goes around, comes around.
Actually I think he didn’t he cared about the two week name use. After all, even if they walked out he would be stuck with an “appreciating asset”. A win-win situation. It was only when the bubble burst that he decided to “sing”.
Haha wih a name like ‘Sing’ it figures he’d SNICH to the cops!!
Cant make these names up people!!! its hilarious.
“Singh”, he’s probably Indian or Paky(Pakestan).
Singh is a Sikh (Indian). South Asians, especially the Pakistanis and Bangledeshis, seem to have a special proclivity for committing mortgage and credit card fraud.
Like Caucasians have a proclivity for raping and pillaging countries with brown-skinned natives?
You’re a moron if you think ethnicity plays a role.
And you seem to be a politically correct person.
OhMy,
SS has a point.For example, I live in Houston and it has the highest rates of credit card and check fraud in the US. This has been the work of many in the Nigerian community in Houston. Before you resort to name-calling and labeling me a bigot, this has documented in the media several times(including an hour-long special on CNN).
Only PC fools think that all cultures are equal. When I lived in Mexico City I recall the oft quote phrase “El que no tranza, no avanza”, which loosely translated means “He who doesn’t cheat, doesn’t get ahead”.
“…And you seem to be a politically correct person…”
Who doesn’t get out much, the only ones playing by the rules are the ones who were borne here.
“…..the only ones playing by the rules are the ones who were borne here.”
Really. Any stats/reports to back up that assertion? I know how contributors on this blog rip apart baseless assertions from LAY’s, Lereah’s, DQ folks’, etc. I wouldn’t expect any less in this case either. Especially from frequent contributors.
“…..the only ones playing by the rules are the ones who were borne here.”
mr income has caught you in a linguistic trap as to be ” borne” means to be carried from “another place”. So your complaint is?
A slight distinction of English.
Nice one, imploder.
“A slight distinction of English.”
Sorry but I am nor buying that. Am also unable to locate any definition of borne that indicates it’s meaning to be carried from somewhere else. And, yes, I do get the difference between born and borne.
“Only PC fools think that all cultures are equal.”
Colorado’s point is spot on. The PC police like to conflate cultural values with racism, thereby obscuring any critical analysis.
Singh is an ancient Indian vedic name meaning “Lion”.
Oh, I thought it meant “Singh for your supper” or “Singh to the police”.
Sure it isn’t “lyin’”?
Too bad Singh wasn’t committing fraud in New York- they could send him to Sing Sing.
Had the same thought further up (but several hours later).
Domi - it’s ‘Pakistan’ - an acronym for ‘Parthian-Afghan-Kashmiri-Indian’.The ’stan’ part just means ‘land’ (as in Green’land’, Eng’land’) -a name conjured up, in the chaos after the seperation of India (Hindu) and the Islamic north (soon to be Pakistan) in 1947, in an effort to distinguish the two diffferent populations.
BTW - “paki” in the UK is as perjorative an epithet as “The N-word” is over here in the USA…just so you know.
Sammy’s right- anyone with the last name, or middle name of ’singh’ will be a Sikh man. Women traditionally have the middle name of ‘Kaur’ which means princess. They’re not Muslim, and technically not even Hindu. They’re from the Punjab - an Indian state, not Pakistan - although the Punjab is near the southern border of Pakistan.
And, enough of the ‘foreigners have funny names yuk-yuk-yuk!’ rhetoric please.
Bet very few of you know that the first name ‘Sarah’ means ‘diarrhoea’ in Serbo-Croat….
Blame the man for being an idiot, or crooked (or a fine mixture of both by the sound of it), but not for his name.
speedingpullet thanks for the history lesson but not necessary for me to know, don’t get mad at me thats what pakistans call each other when their around me.
“The value of undeveloped land, much of it still home to cows, has fallen by as much as $100,000 an acre in this part of San Bernardino County in the last six months, land brokers estimate, settling way below the peak of $550,000 in 2005.”
At these prices, I wouldn’t imagine the bottom is near.
O/T:
Was wondering if any of our “tech-savvy” posters here would like to host a “sticky post” site for HBB’ers.
With so many posts, it’s difficult to maintain a conversation which might be relevant to a number of posters because things move too quickly. Also, a number of us read/post during different times of the day due to time zones, etc.
With a “sticky”/forum site, we could post about HBB get-togethers & maybe have a “post(s) of the day” section where people vote for the most important posts from a given day (from the HBB) & we can easily find & read them.
Firstly, need to know if Ben’s okay with something like this (an HBB sister-site). If so, anyone who currently has a less active blog/site willing to do this (or teach me how to do it)?
Thanks!
I find it hard to follow strings of conversation sometimes… I think I read this blog at an odd time…it is obvious some people post at work. I cannot do that.
a sticky site? sounds good to me.
i have a hard time finding my way back after checking out the links and i have no idea how to go back to site after grows by 200 comments.
i launched a home made site to show photos of mcmansion playgrounds but ben’s site thinks its Spam.
“Bootsma decided not to sell and now rents out the land. He figures it will be more than seven years before prices will climb to where he wants them.”
Sounds like Bootsma took those builders for a ride. Good for him. If you’re smart enough to do that every 7-10 years, and can rent the land out in between, that’s how you keep property in the family for a lot of years and live well in the process.
The more you take builders for a ride the less opportunity we have or affordable housing.
There’s plenty of affordable housing…unsold housing developments all over the country about to turn section 8.
Vacant homes to squat in or conduct a meth or pot biz.
At any price range from free to government handout–there’s a home for you–with granite countertops too.
You know, I’m sorry, but this guy won’t even get $375,000 an acre in 7 years. This RE bust will continue for at least a decade, if we’re lucky. In 7 years, he will be kicking himself that he didn’t sell for that price.
–
“Singh, who admits he agreed to sign as the condo’s buyer in exchange for $2,500, is one of several people who have told the Mercury News that they wound up with mortgages and property in foreclosure after allowing their credit to be used to help someone else buy a home.”
How stupidly greedy one can get. The guy deserves what he is getting.
Jas
And for a measly $2,500. He’s not even smart greedy.
wow! a “Singh” for $2,500? I think we are experiencing a “Singh” bubble. I remember when we could get a “Singh” for a song………………
Geez
$2500???? what a MORON at least if it was $25,000 you could fly the coop to Mehiko!
In a written complaint to the San Jose Police Department, Singh reported that he agreed with two agents to accept $2,500 for ’signing a house under my name’ last
Maybe it was alot more. Then again, lol, maybe the guy was that gullible.
Or maybe he knew what was going on all along and now plays the dumb immigrant vioctim. Probably expected the condo to flip and he’d make $2,500 more at the other end. Now he’s mad at the guys who screwed him.
“When the model homes open to the public for the first time today, Adrian Foley, the president of Brookfield Homes Corp.’s Southland operations will have his expectations in check. ‘I’m a realist,’ Foley said. ‘I acknowledge that the pool of buyers today doesn’t appear to be as big as it was a couple of years ago.’”
I guess this dude will be there ’till the cows come home’…..so grab a six pack……….pick up some HeeHaw dvd’s…..and leave a light on
So who will be the FIRST company to have an open house of say $400K homes for $299K just to get rid of them asap?
In this market that makes sense, cash flow wise
By the fourth quarter we should start seeing builders fire saleing house. I think the builders have taken out most of the dopes that fell for the cash back and upgrade incentives. After a long hot slow summer the builders will have to start working their way down the ladder to find buyers at lower price points. If they don’t keep building and selling homes, their out of business.
Question For ALL…………………
If they don’t keep building and selling homes, their out of business.
Whats wrong with Hibernating a few years??????? If you look at most HB they can cut cost to the bone and just exist on the cash in the bank for a few years….maybe building a couple of thousand homes instead of tens of thousands….most have very little debt to worry about, employees are mostly contractors…so what is the cost to just go on a 2-3 year vacation…and coast till then next boom?
Read the Bootsma story carefully. They would have to take big losses, and probably still would not have the cash flow to support their burn rate.
Because they are publicly traded companies. The CEOs and VPs rely on stock for much of their compensation, so they must produce something to keep their stock values up. They will however cut production to a minimum, still they can’t ever hibernate.
For once it pays to be tiny. Az_lender has no payroll besides herself, so can afford to quit lending when it seems too risky, or lend only to foreign govts (by buying their bonds) instead of to trailer-park residents.
“most have very little debt to worry about”
What? Builders are loaded with debt.
Nothing wrong with going to open houses and talking with realtors thus getting the feel how things are moving or not.
Always be in touch with the market and do research. Mearly dropping out is not the answer. We may see prices drop double digit in months. Dont rule out the impossible.
aNYCdj: Whats wrong with Hibernating a few years???????
If you’re really optimistic about the housing market like they are, hibernation is a losing strategy. People in housing are really, really bullish. Some of it is the personality of people who enter the business of building new homes (”build it and they will come”) and some of it is the history of American real estate - it’s never really gone down in a big way without some major economic cataclysm to cause it. Japan went through almost two decades of slow growth (but not a depression), and real estate went down something like 80%. Hong Kong went through a decline of 60% without any major economic issues - growth was slow, but it wasn’t a depression. A slow economy accompanied by major real estate declines - that’s an Asian phenom. The only time we’ve had real estate declines like Asia routinely experiences was during the Great Depression. And it’s doubtful we’ll experience another Great Depression in this lifetime.
My feeling, though, is that we’ll experience an Asian-like major real estate decline accompanied by slow growth. And this will change the whole psyche of American homebuilders as they start to realize that Asian-style real estate bubbles can happen in America, and when they do, they’ll pop just like they do in Asia, with declines of 50% or more.
lennar
- “But many of the new jobs won’t pay the sorts of wages necessary to buy a house in the New Model Colony.
- ‘Prices have been pushed way too high for incomes in that area,’ said economist Christopher Thornberg.
Hey Chris, you jackass …. this has been the case for the last 3 years.
Hey, at least he SAID IT.
Instead of trying to spin it like those OTHER jackasses…Lereah and LAY.
Speaking of Thornberg, did anyone hear what he said on Bill Moyers’ Journal (PBS) last evening? I was on the phone, and only saw that Thornberg appeared twice briefly in Moyers’s first segment. I was dying to tell my caller to hang the hell up, but didn’t get around to it until the housing-bust segment was over. (I guess it was a housing-bust segment; there were a bunch of shots of houses with “For Sale” signs out front.)
In 2005, the last year for which he has statistics, only about 25% of the households in the Inland Empire had incomes that could support a $500,000 home.”
What is Thornberg smoking? The PITI on a $500k home is about $3,000. Add in another $560 a month for taxes at a 1.35% rate. Assuming the comfort zone of 28% of monthly gross for a mortgage nut, this means Thornberg is asserting that 25% of the IE families earn more than $153,000 a year. No way. Not just no, but hell no.
Oops, the PITI is $3560. Point remains, however.
Agree 100%, BM! I’ll guess that fewer than 5% make that much. Now, we have to work our way down through the $400K, $350K, $300K…houses. Very few people there make enough to buy these houses!
Guessing again, but I’m thinking the average household in the IE could afford a $100K-$200K house. That’s it.
Guess what? I’m thinking most people in So Cal cannot afford much more than a $200K-$300K home **in the better areas** (”Brady Bunch” areas of So Cal where households actually make $100K+).
I think they are misusing the housing affordability index.
A housing affrodability index of 25 does not mean that 25% of the households can afford a house. It means the medain household makes 25% the amount you would need to reasonably make the payments.
So, on the $500K house, it doesn’t mean 25% make more than than $160K a years. It means the middle income households makes $40K. ($160K x .25)
“Prices have been pushed way too high for incomes in that area,’ said economist Christopher Thornberg.”
no Shit Sherlock! Opening a new home tract featuring half-miilion$ MCMansions in Ontario! I can see all the warehouse Distribution Packagers, Forklifters, dockloaders, truckers bringing in their income statements when they apply for those loans. Class A truckers make good bucks but their income in uneven, and they are often out of work for extended periods.
That article states that 40,000 IE jobs created last year in transportation,retail, finance, service,construction. WTF! Construction pays good but the IE construction will die down. Retail/service/warehousing is a joke for supporting $400,000-450,000 sfh prices.
There was very few jobs created in the IE financial sector, mostly no doubt in RE: that sector is getting creamed in the IE.
The IE will see 10% real unemployment rate by end of this year, though the reporting agencies will underreport the numbers.
Y’all need to hold off on Thornberg. He’s been preachin’ this for a long time–check out his Humboldt State University guest lectures on YouTube from last year. Economists can’t really be as blunt as we are on this blog.
You bet. Thornberg was bearish at UCLA before the market showed signs of turning. Then he became wishy-washy on the market (probably bunder pressure from Anderson’s sponsors)
Since he quit UCLA he’s becomming more and more outspoken.
Thanks to everybody for the clarifications. I was feeling depressed at the thought that 25% of IE households CAN afford a $500K house, since I personally feel that if I spent $500K on a house in the IE, it had better be among the 1% of best houses in the IE. (Not the 25%.)
“The year 2008 ‘won’t be so great,’ said Les Thomas, president of Shea Homes Southern California. ‘We hope things will be fine in ‘09.’”
What year rhymes with POS?
Seriously, think about that statement for a minute - the president of a builder “hoping” things will turn around in a few years. Every 5 or 6 minutes on Bloomberg you hear “housing this” and “housing that”. I just heard Countrywide’s Mozilo make the statement “maybe I’m too deep in the forest to have an accurate perspective on the market”. I was a little surprised to hear him say that. This downturn is beginning to gain momentum and it’s a big relief to not be a part of it.
He deep in the forest where money grows on trees.
Countrywide CEO got $120 million in 2006
By Kathy M. Kristof, Times Staff Writer
April 28, 2007
http://www.latimes.com/business/la-fi-mozilo28apr28,1,6804246.story?coll=la-headlines-business
2010 will bring the suicides of many RE men.
I remember when the market topped out in 1990. Everyone started out by saying, “It’ll turn around in 6 months”. Then it got worse. “It’ll be done in ‘91″. Got worse. “We will get thru ’till ‘92.” Got worse. That was the end of predictions. The new mantra was “Stay alive until ‘95. And it got worse. By the time ‘95 ended, we were at the bottom, but not much hope. The new mantra was “Hopin’ to Heaven it’s ‘97″. And 1997 was more stabilized. Prices were not dropping. You could buy a house that sold in 1990 (at $175,000) for about $145,000 in 1997. Most of the foreclosures had worked their way thru the system. No one wanted to own houses and you could buy them at 10 times the rent. With all the expenses, and 7% rates, you had a 2% cash on cash return on your equity investment.
This time we can dispense with all the interim mantras and just say “Hope to Heaven it bottom’s in 2011″.
But it’s different this time - prices are more inflated than they were in 1990 and much of it has been built on suicide financing.
J-1,
You are correct, but there are other differenced too, which may offset the imbalance to the other side. Employment is strong at 95% (not true in 1990). The commercial real estate market seems to be O.K. so far (not true in 1990). However, if housing leads us into a recession and/or interest rates rise substantially, it will get much uglier than 1990-97. Time will tell and that is why it so important to not buy in a false bottom. Wait until the end of 2009 and re-evaluate then. Certainly, real estate will not be going up, so you have nothing to lose by staying on the sideline. If a builder’s CEO says ‘08 is in the tank, you know ‘09 will be flat at best.
Last week my wife was speaking to a woman that does commercial leasing. She said that she’s starting to see some problems with the leasing b/c people secure their spaces with HELOCs and the HELOCs are going away. It’s these kind of secondary effects that will cause even more pain than anticipated.
I found some data that agrees with you.
http://www.census.gov/hhes/www/housing/census/historic/values.html
Domi, very telling numbers. One of Judicious1’s points above is that it may be different this time, as it is more out of balance than in the past. He is right. And one way he is right is that the whole NATION is experiencing this housing bubble. Your table shows that has never happened before. Different areas had declines, but they were offset by areas that had appreciation. Once Salt Lake City pops, they whole nation will be declining in value.
Can I sell a Brooklyn Bridge under Singh’s name? Do you think his cousin wants to buy it?
Frank, I’ll broker the transaction if I can use Singh’s 1003 Loan App. By the way, I think the bridge needs about $10,000,000 in upgrades and remodeling. Please include that in the loan amount and cut a check to Jingle’s Bridge Construction, Inc. Sheesh. How stupid can the lender’s be these days?
I’ve been looking at some open houses in South OC these last few months. I definitely smell desperation creeping in. Last week we looked at a 5 br that had dropped from 900K to 800K asking over about 2 months. The agent told us they were offering $50K cash back (for “remodelling”). I suspect that is illegal (?), and I can’t imagine why a seller would make this offer. How does it benefit them? The agent wouldn’t give a straight answer, despite my intensive interrogation. He kept ducking the questions. Does anyone know if this is illegal, and why a seller would make such an offer?
I’ve watched Homeseekers inventory climb tremendously (30%) over the last several months in my neck of the woods. Now its time for prices to make the same 30% adjustment. I feel sure that by the end of the summer the slide will be there. People will realise they’ve been duped into believing their sudden wealth materialized out of this air. What a grand hoax.
“why a seller would make such an offer” - the offer was possibly the realtor’s idea, not the seller’s. One possibility is that the realtor will in some way share with the seller the excess commission produced by the phony price. Another possibility is that the seller has other properties to dispose of and hence wants to keep nominal prices high. Various other possibilities involving mortgage-oriented fraud are imaginable.
I think it’s because they feel the “incentive” will make their house stand out more. Lower prices are “boring”, and you end up leading/following other sellers down. By using incentives, you can pretend that prices are $XXX, but “look at what a great deal I’ll give you!!!”
Also, some buyers who will use all their cash for down payment & closing costs & would like the extra cash to fix the house up. In a sense, it might be a 95-100% LTV loan, but the lender doesn’t know it.
it might be a 95-100% LTV loan, but the lender doesn’t know it.
———————–
Clarification: they might not otherwise qualify for a high-LTV loan, or might not get as favorable terms if they put less down.
This is the very reason user auto makers use rebates in lieu of lowering the MSRP on a car.
“The agent told us they were offering $50K cash back (for “remodelling”). I suspect that is illegal (?), and I can’t imagine why a seller would make this offer. How does it benefit them?”
My guess is that he’s hoping to find another Singh. Someone that will buy the house, live high on the hog for a year on the $50K cash, then go bankrupt when the house is foreclosed.
Singh and a WHOLE lot more will do well to reserve their Scenic, Luxury Cardboard Box UNDER the Brooklyn Bridge.
“Singh, who admits he agreed to sign as the condo’s buyer in exchange for $2,500,
So he admitted to mortgage fraud. How is his @$$ not in jail? I say since he signed as the condo’s buyer, he actually bought the property and he is responsible for it.
What’s the interest rate for a loan of $2500 that needs to be paid in full a year later for a total of $579,000? Let’s check the math…
loan amount = $2500
full payments = $579,000
interest = $579,000 - $2500 = $576,500
interest rate = $576,500 / $2500 / 1 year = 23,060%
Wow! I would have loaned Singh two and a half grand for only 10,000% annual interest. He should have come to me.
This is brutaly bearish:
http://www.countercurrents.org/hren250407.htm
I follow homes listed for sale in bay area (peninsula). 2k sq ft still being listed for million plus. Just heard of 2 homes even sold in the last week for the asking price (about 1.2 mil each). what do you guys make of this? where do these people get this kind of money?
This happened before in San Mateo back in late 80s and the pain was deep for years to come.
stock options
Not anymore. Which means those who over paid using stock options, and hoped for further appreciation and future wealth effect from the next buyer isnt going to happen. Stock options are being halted due to scandels and collapse of IPO markets. There are more M&A then any IPOs this year.
az_lender, in this case the seller is also the realtor. He did mention something about not wanting to offend the neighbors, but the commission is a more likely reason. It believe that there is a way to make closing costs tax deductable (for the seller, if the sellers pays). Maybe there is a link there.
Do you know for sure that these money back schemes are illegal? I should tape record the conversations…
The law allows up to 3% to be used for repairs. If it is not used for repairs, it is mortgage fraud. Mortgage fraud is a felony and there are some steep penalties. It has been rampant in the last few years, because lots of real estate agents, mortgage brokers and speculators committed the fraud at $100,000+ per transaction. A week went by, and no one arrested them, so they did it again, and again, and again. The lenders did not care, since the property always appreiciated. Now properties are dropping in value and probably will keep dropping thru 2011. The lenders are losing billions. Suddenly, they are aghast at the amount of fruad. And with billions at stake, watch what happens. There are now firms sprouting up all over to track the fraudsters and make them pay up. Every real estate transaction has a paper trail. It may take a couple of years, but there will be many brokers who wish they had not “pushed the limit”.
“‘There still are deals out there,’ said William Shopoff, founder of an Irvine investment firm. But, he added, deals are earning 25 percent to 40 percent less than what they generated 18 months ago.”
So….. after the music stopped, this is what investors are expecting. Then 25-40% less than 18 months ago should be the high bar for anyone, land or housing.
And on a side note, Shopoff? You got to be kidding…..how many of these stories are selected for their information value, and how many for the comedic value of the names?
1997-2005 = “Shop-on”……. 2005-Present = “Shop-off”
the flipper!
lefantome, I’ve noticed this as well.
With all the very common names like Smith, Jones, Brown etc…….How is it we end up with quotes from people with names like “Shopoff”……….maybe these are names born out of the bubble.
I’ll bet Ben just loves to toss in these teasers.
“In a written complaint to the San Jose Police Department, Singh reported that he agreed with two agents to accept $2,500 for ’signing a house under my name’ last May while working at Century 21 Su Casa’s Fremont branch office.”
Century 21 is the biggest RE fraudsters in the Bay Area. The minute you walk into their offices all they would say “Its a sellers market and you need to overrbid by 10% before you even see your first home.”
His plea at his fraud trial will be ” not guilty by reason of being a moron”
LMAO
A blast from the past
http://www.bizjournals.com/sanjose/stories/1996/06/17/newscolumn4.html
He is increasing property tax assessments for many homes sold in that area by nearly 10 percent.
(Proposition 13 limits increases in annual property tax assessments to 2 percent except for homes being assessed on values that are less than what the homeowner paid for the home.)
“Values are back up,” he said. “That is good news for everyone.”
Of the 420,000 parcels of real estate in the county, 97,000 have been assessed at less than their purchase price during the past few years, he said.
Mr. Stone said 40,000 of those homes will now be assessed at least at their purchase price. He is mulling hikes on the remaining 57,000.
From 1990 to 1995, these 97,000 properties were assessed at 1.2 percent to 25 percent less than their purchase price, depending on where they were located and when they were bought.
Mr. Stone said he’s the first assessor in the state to take such action.
Property values are up in all parts of the county except for some portions of South County, including Gilroy, where values remained relatively flat, he said.
Front page on BusinessWeek site, “Why This Slump is Different”
http://tinyurl.com/2jedn5
Also, see the side article “How the Bad News Could Get Worse.”
“Foreclosures are rising fast, investors are sweating, and lenders are now bending over backwards to keep bad loans alive
Says Steve Bailey, senior managing director at mortgage giant Countrywide Financial Corp. (CFC ), who oversees the company’s $1.4 trillion portfolio: “You need to keep the revenue stream flowing and keep hope alive.”
And to think Im a loser renter… Im sure no mortgage serf…
That’s OK. By latest count, CFC is a bagholder to the tune of $1.4 billion in FB homes.
http://countrywide-foreclosures.blogspot.com/
This guy manages a $1.4T portfolio and talks about keeping “hope alive”?
missed a few points
1985 oil patch started down so 15% of homes were down
1987 investors unwound positions for tax changes
some areas never boomed - midwest & plains states 20%
this time everyone is in the bubble
all up ,now all down
From the article…………..
“By keeping borrowers in houses they never should have bought, lenders could simply be setting everyone up for a steeper fall down the road. But for now the focus is on working out some alternative to foreclosure. With the housing market being buffeted by the harshest storm it has seen in memory, everybody’s just trying to hold on.”
Look out below!!!!!!
I rent in a nice neighborhood in Rancho Cucamonga. When the house across the street went into escrow within 60 days of beibng listed, I couldn’t wait to see the dipsticks who made an offer anywhere near the 720k asking price. I got my answer today:
A do-it-yourself U-Haul and about 4 lower-class type cars (lowered mini-truck, corrola) all pulled up and about 15 real low-life looking Mexicans got out and started unloading. These are the people propping up the So-Cal market, multiple immigrant families on toxic loans that are obviously ignorant of the bubble here. (This is not racist, I am Mexican, just one of a different sort, educated, 2nd-generation here).
You have to tell us how many people wind up living there.
A do-it-yourself U-Haul? What’s wrong with that? When I moved to my rental townhouse last year (for much less than a mortgage payment, thank you) I did all the work myself with a U-Haul. I’ve never moved any other way. A couple of the neighbors came out to drink beer on their porch and I overheard them making a sarcastic comment about it. They are also the types who pay $380,000 for townhouses that are now listed for $299,000 but are probably only worth $120,000.
I sure didn’t expect to hear that sort of image-conscience, keeping up with the Jones thinking here.
Seriously, who would pay more for a moving truck when they can do it with a U-Haul? No one that I expect to find on this blog, that’s for sure….
Yeah, when I moved back to Colorado from Utah, we did it ourselves (me and a friend) - he had a beat-up pickup and a big trailer (and he’s actually worth a fortune). I asked my sister to start praying when we left the Utah house with the big load. She did (she’s a very devout Christian). We pulled up to the new place here and unloaded. My friend started up the old p/u and it caught on fire. OT, but I just had to share that one…
I understand what IE is getting at. Of course there’s nothing wrong with a UHaul. What’s ridiculous is paying upwards of $700,000 for a house and then showing up with a do-it-yourself extended family crew. Sort of incongruous.
Here in Florida we have just the opposite. Extended family (illegals) buying stucco facade crapshacks for $200,000 and showing up with huge moving vans that take up the entire street. Go figure.
That’s exactly what I was getting at. Nothing wrong with a U-Haul but if you can afford a 720k mortgage, you can afford $500 for a mover and a car worth more than $2,500. This is an observation on “who” is buying at these outrageous prices still (not your typical American consumer).
The point is that this is a very nice neighborhood (remember Rancho is 45 miles outside of LA where 200k used to buy a mcmansion on a big lot a few years back). Now 720k gets you a cookie-cutter 2,500 sq ft w/a pool in a newer neighborhood. These are not the type that live in this neighborhood. Mostly all single families (mostly white), little league types. I am sure there will be multiple families in that house. The last 3 purchases on this street have been by multiple immigrant families. Now we have little punk-ass looking thugs eyeing our little girls, multiple crappy vehicles parked on the street, etc. I am not an elitist, but part of what irks me about this bubble is that someone (like myself) who went to college and has a good job can’t afford to get away from the riff-raf anymore and buy a home in a decent area (much less one without this crap going on).
IE Fencesitter: what’s the carrying cost on 720k? are we talking $5000 a month? Nothing wrong with having an extended family in one house but they are going to figure out that the house isn’t worth 720K. What if the owner goes back to Mexico leaving the family in the house? How does the mortgagee gain possession?
It depends on what you mean by “extended family”. Its one thing to have grandma and cousin Joe live with your family, its quite another when 4 families live in a single family home.
In many areas, there are county restrictions on how many “unrelated” people can live in a house. In Long Island, it was to keep some control of summer houses rented to 20 somethings.
8-10 sifferent “families” jerry-rigged into a sfh with plug-in cooking arrangements could be a fire hazard. The local fire dept. may want to look at this house…you don’t want to even rent across the street from a burn-out.
Fed’s Yellen: Economy likely to ‘pick up steam’
http://tinyurl.com/38r73s
WASHINGTON (Reuters) — The U.S. economy grew modestly in the first quarter but should accelerate in the second half of the year
“I do think there are downside risks to the American economic growth, but in spite of those risks I really think it is quite likely that the U.S. economy is going to pick up steam and revert back to trend growth before 2007 comes to and end,” Yellen said
I guess she means to say, the Fed will start printing money and that inflation should create growth in the latter half of 2007
Maybe she ought to take a tour across California to see all the semi-occupied McMansionvilles before she gets too optimistic about acceleration. I don’t believe we can grow our way out of record overbuilding and overpricing of the housing stock relative to fundamental needs.
Janet is just trying to soft pedal “ahead” of the recession news that will from the data that shows up in Q2 or Q3 statistics.
All the local jackasses here in SF are probably on her case, as well, to get BB to fire up the helicopter. She’s just telling them to relax.
Why wouldn’t the illegals come? The Peso is gaining on the dollar, so that $720K isn’t as bad as it seems. Plus, they can make a beeline to the Bank of America branch, get a few credit cards. After a few months, they’ll trash the house right before they get foreclosed on. Then they’ll be a victim, get the sympathy of the bleeding hearts, then do it again.
Its so funny you mentioned Bank of America. I used to work there and they had secured credit cards for hispanics. I don’t want to say all but the majority were not approved for the unlimited credit, so the bank counteroffered them secured credit cards with a deposit as little as $99.
Besides that, I’ve come across some illegal immigrants that would use deceased social security numbers to open and establish accounts. Its just sad.
26% of Sonoma Valley homes on the market are in some stage of foreclosure
In other news…
(from the NYTimes)
“In a stark reversal, it’s now clear that people who chose renting over buying in the last two years made the right move. In much of the country, including large parts of the Northeast, California, Florida and the Southwest, recent home buyers have faced higher monthly costs than renters and have lost money on their investment in the meantime.”
“It’s almost as if they have thrown money away, an insult once reserved for renters.”
“In a stark reversal, it’s now clear that people who chose renting over buying in the last two years made the right move.”
We told you so!
26%? Is that true?
“It’s almost as if they have thrown money away, an insult once reserved for renters.”
******
What? It’s not “almost” - they HAVE thrown money away.
For many, lots of it. Like in some places around the SF Bay, a $100,000 or more.
And more of that to come.
“Singh, who admits he agreed to sign as the condo’s buyer in exchange for $2,500, is one of several people who have told the Mercury News that they wound up with mortgages and property in foreclosure after allowing their credit to be used to help someone else buy a home.”
Momma always said, “Stupid is as stupid does.”
– Forrest Gump –
“‘I’m like, God, I don’t have any of this. And $24,000 in my account? That’s completely insane,’ Singh said in an interview.”
Is it really that hard to save $24,000 these days?
Quick the mocha-lotta, drive a commuter car, and stop f’n whining that you’re not getting ahead.
-X
Re: The Desert Sun story commenting on the Lennar new home auction in north Indio.
Those are homes originally listed last year starting in the “Low 500s”. This year they were from the “Mid 400s”. Now they are being auctioned starting around 300,000.
The location is way out on East 1-10 near Thermal. Based on location alone these are “worth” IMHO mid 200,000s.
The auction houses have reserve prices that have not been met yet. Yesterday only about 1/2 had bids. It will be really interesting to see what these dogs go for. Coachella Valley asking prices still ridiculous but trending down about 10-15% for existing/new it seems, and inventory is still piling up.
Renewing my lease of a gated community 2000sf 2004 model home for $1350. Out of that landlord paying HOAs of $230. 3 bed apartments in the valley are going for 1200-1300. Landlord seemed more than happy to renew at current rate. Could have played hardball on the rent but I guess it is fair.
Are the landlords on Craigslist serious? I have seen more dumba$$ asking rents on that site…
OMG WOW! Video on the foreclosures in Georgia.
http://tinyurl.com/yw3t92
Like the title, “Inside the Foreclosure Wars.”
Am I the only person for whom CNN videos NEVER work?
Do you have to be a CNN Pipeline subscriber to get these to work?
No you are not the only one because it didn’t work for me either.
You need Windows Media Player.
Nope, I’ve got the latest. Still no dice.
I don’t know if this table has appeared here before (it is from the Mortgage Bankers Association):
http://www.mbaa.org/ResearchandForecasts/MarketEnvironment/1-4FamilyMortgageOriginations1990-2005.htm
(Bil. $)
Total Originations
Purchase Originations Refinance Originations Refinance Share (%)
1990-Q1 116 94 22 19
1990-Q2 123 107 15.943 13
1990-Q3 120 104 15.607 13
1990-Q4 100 84 15.988 16
1991-Q1 106 74 31.752 30
1991-Q2 136 100 35.244 26
1991-Q3 152 120 31.897 21
1991-Q4 169 91 77.643 46
1992-Q1 255 92 133.039 59
1992-Q2 215 144 70.967 33
1992-Q3 220 117 103.317 47
1992-Q4 233 119 114.325 49
1993-Q1 190 110 79.595 42
1993-Q2 248 117 131.699 53
1993-Q3 290 142 147.771 51
1993-Q4 292 117 175.268 60
1994-Q1 262 136 125.53 48
1994-Q2 214 165 49.292 23
1994-Q3 157 137 20.454 13
1994-Q4 136 119 16.269 12
1995-Q1 119 106 13.125 11
1995-Q2 141 122 18.268 13
1995-Q3 190 139 51.237 27
1995-Q4 190 127 62.645 33
1996-Q1 194 101 93.214 48
1996-Q2 209 155 54.376 26
1996-Q3 191 158 32.407 17
1996-Q4 191 145 45.904 24
1997-Q1 174 123 50.386 29
1997-Q2 196 155 41.223 21
1997-Q3 222 162 59.985 27
1997-Q4 241 150 91.744 38
1998-Q1 330 149 182 55
1998-Q2 401 225 176 44
1998-Q3 429 227 201 47
1998-Q4 496 194 303 61
1999-Q1 373 168 205 55
1999-Q2 405 251 154 38
1999-Q3 334 254 80 24
1999-Q4 267 205 61 23
2000-Q1 238 183 55 23
2000-Q2 302 254 48 16
2000-Q3 312 255 56 18
2000-Q4 287 213 75 26
2001-Q1 418 192 226 54
2001-Q2 579 272 307 53
2001-Q3 507 274 233 46
2001-Q4 739 222 517 70
2002-Q1 518 217 300 58
2002-Q2 552 315 237 43
2002-Q3 774 302 472 61
2002-Q4 1010 263 748 74
2003-Q1 794 230 564 71
2003-Q2 1187 344 843 71
2003-Q3 1199 384 815 68
2003-Q4 632 322 310 49
2004-Q1 627 251 376 60
2004-Q2 825 379 445 54
2004-Q3 646 362 284 44
2004-Q4 675 317 358 53
2005-Q1 640 294 346 54
2005-Q2 800 432 368 46
2005-Q3 869 434 434 50
2005-Q4 718 352 366 51
2006-Q1 590 301 289 49
2006-Q2 719 410 309 43
2006-Q3 624 375 250 40
2006-Q4 N/A N/A N/A N/A
The most alarming part of the table is the percentage of refinances in 2003- roughly 70% of mortgage activity was in refinances! That sucking sound you hear is equity going away…
Dang, the format came out UGLY. Check the link…
That table here was great. Ugly or not.
It shows that many who are looking for government bailouts are simply financially reckless, to their detriment.
Actually, 2003 was the bottom for interest rates. You were a moron if you **didn’t** refinance in 2003. I know many people who refi’d in ‘03, but did not take cash out. They simply lowered their monthly expenses by (potentially) hundreds of dollars.
The morons are the ones refinancing in 2005-2007. These are the ones who are “Hail Mary” refi’ing & churning their debt, most likely. They probably had low rates from ‘03, but had to get more money to pay off credit cards, install the Pergraniteel kitchens, etc.
‘What Will Happen To Real Estate Prices?’ That is the question
By Jeff Stricker & Steve TenBroeck
In recent months we have been asked, “What will happen to real estate prices? Is it a good time to buy or move up? Should we wait?” It is an acknowledged fact that real estate prices move in cycles. The last complete market cycle began in 1993 and ended in 2002.
William T. Tappan outlines a complete real estate market cycle in his book, “Real Estate Exchange and Acquisition Techniques” (Prentice Hall 1989).
The four phases of the cycle include:
• Activity Basing: Real estate activity and expectations are low, prices are soft.
• Activity Rising: Demand picks up and begins to absorb supply; construction activity and prices rise.
• Activity Topping: Supply catches up to demand, construction tapers off; outlook is generally optimistic and fear is of missing a profit.
• Activity Falling: Supply exceeds demand; prices stop rising; sellers must give concessions; credit becomes increasingly restrictive; pessimism increases.
A complete cycle in the Bay Area real estate marketplace typically lasts 7 to 10 years. During the cycle, real estate prices typically increase 100 percent, and then fall back 20 percent to 25 percent.
We have entered the “Activity Topping” period locally, which may continue over the next year or two. Price appreciation will begin to flatten. The best properties will attract more attention and higher priced offers, separating them from the pack. By “the best,” we mean those in the best condition, in quiet locations, on low-traffic blocks, and those priced at, under, or very near to, their current market value. As more homes come on the market, homebuyers will have more choices. Buying “the best” home will be more important than buying quickly.
Our advice to sellers: Spend the extra time and money to put your home in its best showing condition. Price it as close to market value as possible. If you anticipate selling in the next 1 to 3 years, stay in close touch with your realtor regarding market changes and prepare to place your home on the market quickly. It typically takes 4 to 7 years for prices to recover once they begin dropping (it took until 1995 to regain 1989 prices, for example).
Our advice to buyers: Purchase the best “blue chip” home you can and lock in today’s low interest rates. Plan to hold it long term (7-10 years). You can expect an outstanding return on your investment, because the local population will continue to increase over the long term and new residential construction is negligible. Unless the laws of supply and demand are miraculously suspended, there will continue to be upward pressure over the long term on local home prices.
Jeff Stricker is a real estate broker and attorney and Steve TenBroeck is a broker and Seniors Real Estate Specialist with Alain Pinel Realtors. For more information, call 209-1552 or visit http://www.JeffAndSteve.com.
These guys are dreaming.
1995 was definitely not the year when prices regained 1989 levels in the Bay Area.
See here:
San Francisco Chronicle
“Real Estate Rebound
After a long, painful slide, housing prices around the Bay Area — especially in certain zip codes — are finally heading back up”
Jonathan Marshall, Chronicle Economics Editor
Sunday, April 9, 1995
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/1995/04/09/SC67582.DTL
*******
“Plan to hold it long term (7-10 years). You can expect an outstanding return on your investment, because the local population will continue to increase over the long term and new residential construction is negligible.”
This statement is ridiculous. One had better plan to hold a lot longer than 7-10 years for an “outstanding investment” in most SF neighborhoods.
And what’s with the cycle end in 2002? Did we go through a basing, rising and topping in three years, up to 2005 or 2006?
From the article I quoted, without adjusting for inflation:
“By the end of last year, prices in Alameda, Contra Costa, San Francisco, San Mateo and Santa Clara counties were still well below their peaks at the end of 1989. People who bought five years ago in those counties lost as much as 17 percent of their home value — reflecting the region’s loss of jobs and income during the recession.”
In L.A., we didn’t see 1989 prices until 2000-2002 (depending on the area).
Truth is, the cycle should have finished playing out by 2002 (I think 2001). Problems was Greenspan juiced the market with the low rates, which resulted in even lower lending standards.
We have such a long, long way to go before this is over. If you “hang on” for 5-7 years, we will likely be at the bottom, NOT at the next top. I expect many bubble areas will see 35-50%+ drops from peak prices.
Oh, that 10+ year waiting period was for **nominal** prices, BTW, not inflation-adjusted.
more proof brokers are morons
DDUUUUDDDEEEEEEE!!!!!! NO WAYYYYYYYYYYYYY!!!!!!
House prices must go DOWN A LOT in southern California as foreclosures are growing and growing and will continue to do so.
The message is clear, there are many buyers that can’t afford a house at these outrageous prices, NOW with so many foreclosures their “break” is here and buyers will next be “low-balling” offers and it just take one or two acceptances and the slide will begin. It’s going to be a BIG slide too.