Bits Bucket And Craigslist Finds For May 11, 2007
Please post off-topic ideas, links and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
November 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
interactive chart for 18 housing metro regions
The global merger boom - déjà-vu / Economist
Bourses in China eclipse all of Asia
Dow vs Gold / chart
http://immobilienblasen.blogspot.com/
PA is gearing up for a bailout MA style: Link
The measures include powerful things such as “a voluntary moratorium on foreclosures.” And, “bonds backed by the Pennsylvania Housing Finance Agency to help homeowners with adjustable-rate mortgages renegotiate their deals into fixed-rate loans.”
link is “kaputt”
Darn, try this: Link
rendelski is a commie
age in place
freer healthcare
a now ,no need to pay your mort
imagine PA w/o unions and lefties
would be a great place
Try this one …
“Pa., N.J. moving to aid subprime borrowers: Some homeowners can’t pay the increased payments on adjustable-rate mortgages”, by Harold Brubaker, Philadelphia Inquirer, May 11, 2007.
http://tinyurl.com/2hjm9n
That’s Fǔčking Bȗllsh
That’s Fǔčking Bȗllșhit
“The board of the New Jersey Housing and Mortgage Finance Agency plans to issue $30 million in taxable bonds”
I hope those bonds lay there like a wet fart.
the more I read your stuff palmeto, the more you remind me of my dad…….tooo fricken funny
$25 - $50 million should cover about 200 homes in Jersey. They better hope they can contain the entire Jersey mess with refinancing under 200 homes. It will be nice to see the Jersey legislature implement such stupidity and lock up their lending industry.
I have yet to see a bailout proposal that doesn’t make this much worse than it would be without government intervention. Keep on rockin’, boys.
Most of this will go to fund some new agency which will stay around forever and be staffed by political cronies. Work will be subcontracted out to firms to provide ‘counseling’ &etc, which firms will also be doopa buddies of politicos.
double bingo
we have an office in a mall to show a model of a raod project
5 million over 5 years
At least that will add to some employment.
Might as well forget about any meaningful RE loans for the Keystone State…..it will be toast like Mass.
Why Rent? Why Buy? Let’s just squat!!
/sarcasm off
If PA even thinks of trying this, oh, boy, is there going to be a revolt. (And, since my parents live in PA, I’ll surely hear all about it.)
I just wrote to my senator basically saying I didn’t vote for home to he could help run the budget further into the ground. That I won’t vote for him in the future and good luck getting reelected with the financial storm about it hit.
God I can’t want until we can leave PA.
60 Minutes: ‘Be glad that it’s Mother’s Day,’ says NAR
Word is out that the much-anticipated 60 Minutes segment on the real estate industry will air this Sunday night and the shrewd PR team at the National Association of Realtors has already been out doing damage control. A letter from the national trade group to its smaller associations has been circulating, giving some talking points on how to handle media and member inquiries about the issues raised in the segment.
Among the talking points NAR suggests: Realtor associations support all business models and favor none; real estate is a highly competitive business with one in 86 adults now a Realtor; there is no such thing as a “standard commission.”
The letter notes: “Bottom line is that we don’t expect that the segment will make Realtors happy but it could have been much, much worse. Be glad that it’s Mother’s Day and the show will probably draw fewer than its average 14 million viewers.”
1 in 86? Wow.
That can’t be right. Sacramento has 2 million people. That would equal 23,800 Realtors. We only have 16,000 houses listed for sale (soon to pass the all time record of 17,500 by June). Could a Realtor live on 16/23rds of a commission?
Only if they are getting reduced priced meals at Mc Donald (second job)
The number in California was 1 in 60 for realtors so 1 in 86 sounds low. There are over 500,000 realtors in California. That number has been posted on this blog many times. They just don’t get what is going to hit their economy. This is disaster.
Remember that some people became realtors just to save on the commission when buying their own house! This was the situation of the person who bought my house in Silicon Valley. I know they had to share with the broker but it was still worth it. The buyer/realtor did one transaction — buying my house. He also had the 3% taken off the price of the house which lowered his property taxes (my tax accountant said this was OK and didn’t matter to me financially). Since houses in CA are so stupidly expensive, even a 1.5% commission back to him (= to $22.5K on a $1.5M house) can make getting a realtor’s license worthwhile.
I did this for the purpose of buying investment properties in DFW (I take a price reduction equal to the commission for tax purposes). After two years I became a broker. I might be the only broker who has never earned a commission.
Count me in that crowd as well. Illinois doesn’t even make you wait two years.
They do make you take about 5 (pretty easy) tests though.
In TX, if you’re a lawyer, you can take half the commission. Great deal for lawyers.
I remember reading in 2005 that there were half a million realtors in California. Remember that it’s easy and cheap to get a license (three on-line courses and a licensing exam.) And every loser in California decided to get into real estate that year, thinking they would be instant millionaires. I knew that we had reached the peak when a guy installing our water heater gave me his real estate card. It was hilarious - the overweight sweaty guy in my garage was wearing a tuxedo in the card photo.
Hilarious. The mortgage biz is right on its tail.
Source?
Here it is (NOTE: PDF file)
http://blog.seattlepi.nwsource.com/venture/library/60minutes.pdf
HUH? And how long before we see that segment plastered all over youtube and a global and repetitive audience? I am sure some diligent blogger will tape it for posterity! They are really behind the 8ball if they think that just because it airs on a certain date, that that is the end of it….. Of course they are an association of neanderthals trying to figure out how to monopolize the information that is spread throught the internet.
To be perfectly honest, the 60 minutes audience skews old and therefore is unlikely to frequent youtube. But that just means it may reach a little less of the classic 60 minutes audience.
Once it gets on the web, it will reach WAY beyond that audience. Thinking that an explosive tv segment will only reach the typical audience of that show is SO old media.
Since I haven’t got a VCR and am having a dinner party (of old people) this coming Sunday, I hope you guys will let me know when a transcript of the 60 Minutes segment becomes available on line. Just yesterday I was able to read a transcript of the Calif Republican presidential candidates’ debate, learned a lot about Cong. Ron Paul the libertarian.
What’s a VCR? I’ve heard of TiVo. But this VCR is new to me.
i just bought a used vcr so i can see my olde videos.
Since I have no VCR and am having a dinner party of old people this Sunday, I hope you guys will let me know when I can find a transcript of the 60 Minutes segment on line. Just yesterday I had a chance to read a transcript of the Calif Republican presidential candidates’ debate, and learned a lot about Cong. Ron Paul the libertarian.
VCR? What’s that? Is that one of those old-fashioned things that actually used *tape* to record things?
My MythTV box is primed and ready!
Don’t excpect much from a 5 min 60-minute segment. They ususally focus too much one particular situation or family.
What we need is MICHEAL MOORE doing a documentary on the REIC.
He could bust the whole monopoly 4-ever.
Maybe some other edgy documentarist will go after them and expose the truth.
Michael Moore, please. That guy has no credibility and becomes more discredited with every film (in reality propaganda pieces) he makes. There’s gotta be somebody else… maybe that John Stossel guy on “20/20″ might be good. He wrote a great book, “Myths, Lies and Outright Stupidity.”
I’d love it if Michael Moore did a piece on the REIC. There would even be money it if they got the release timing right.
The REIC should hire Michael Moore as their Minister of Propaganda. Their problems would be solved. Nobody can create a fable and sell it to the sheeple as truth like Moore can.
But Moore would never make a pro-industry film. I hope he does make an anti-REI movie because people actually go to see his movies, unlike most documentaries. An unbiased movie would be boring - if you look at it critically you can separate the facts from the propaganda. I come to this blog because I agree with the point of view here, and the facts that support that point of view are provided on it.
commisions will get hammered now that the sheople now how “helpfull” realwhores and mort brokers have been
in EU a high % of homes are sold w/o a realwhore and congress will have a new BLack Box doc for borrowers to view soon
In reading up on the 60 Minutes segment, I found this.
http://www.bloodhoundrealty.com/BloodhoundBlog/?p=1397
An excerpt, “Before I get to my list of five techniques, there are a couple of lists of three to consider. First, a successful listing praxis consists of three parts: Hiring the seller, marketing the home and servicing the transaction. I’ll be addressing marketing tactics below, but note that I said that we hire the sellers. Too many agents think the seller is hiring them, and it leads them into one obsequious error after another. We work with people who know that we know more about selling houses than they do. We interview them very carefully, and we turn down the ones who can’t or won’t do what we need them to do. We can only sell the houses that will sell — and whose owners are willing to sell — so we avoid the others.”
Puh-Leeze.
“We can only sell the houses that will sell — and whose owners are willing to sell — so we avoid the others.”
Correction: We can only sell the houses that have owners who will doll them up and drop the price far below what we feel market value is. Those who can’t or won’t drop the price we will still allow to hire us. Who do we think we’re kidding? Have you seen this market?
I forwarded this to the DOJ. This article discusses how to braek many antitrust rules. Maybe it will be helpful in the DOJ’s case against the NAR…
Hey at least he has a cute dog.
Does anyone know if Redfin will submit lowballs? Bet that isn’t touched on in the segment.
I wasn’t aware of that 60 Minutes segment coming this week. Thanks for the heads up!
FIXED:
Among the talking points NAR suggests: Realtor associations support all business models and favor none*; real estate is a highly competitive business with one in 86 adults now a Realtor; there is no such thing as a “standard commission.”
*only after the DoJ filed an antitrust suit against NAR (goes to trial in Chicago soon)
Oh yeah, the NAR welcomes all business models with open arms!
DoJ and FTC report on competition in the industry. (NOTE: PDF file)
http://www.usdoj.gov/atr/public/reports/223094.pdf
Let’s not confuse “licensed agents” with “Realtors”.
I know several people that were going to become flippers that ran and got their licenses so they could do their transactions themselves.
NAR claims 1.3 million members. With 300 million people in this country, that is well short of 1 in 83.
I think they claim adults, so you’d have to lower the 300 million figure.
Okay. Limit it to 20-64 y/o= 178 million people.
http://www.census.gov/popest/national/asrh/NC-EST2005/NC-EST2005-01.xls
1.3 million members of NAR is still 1 out of 136.
Maybe they are talking “work force” slicing out disabled, stay at home, incarcerated, etc. Still, to get 1 in 86, that would mean only 61% of people between 20 and 64 are “in the work force”. I don’t think so.
The only way to get the numebr 1 in 86 is to count people that got a license to do their own deals, but aren’t in the NAR.
This is all about an orderly decline in the housing market. However, they just don’t get the order of magnitude here. Once the FB realizes that prices aren’t rising and they are paying more to live in their house then their neighbor who rents, they’ll throw the keys on the counter and walk. Who is going to fund (subsidize) a $100 K or less wage earner with a $500K obligation holding a declining asset?
“This is all about an orderly decline in the housing market”
Exactly. Much like Hank Paulson was brought on as Treasury Secretary to manage the orderly decline of the dollar. Overall, it is about preventing the real, underlying fundamentals from being fully revealed to the sheeple so as to prevent widespread, Depression style panic. The conditions exist for this to happen, but I get the feeling industry groups are working to stave this off. It can only be postponed. I wish we’d just get the crash over with.
That’s an interesting point — Paulson brought in to manage orderly decline of the dollar. Was this common knowledge? Common among whom? I’m curious, because I’ve felt some of us have had to engage in guesswork, apart from the announcement last fall by some conflab of East Asian finance ministers who said they would gradually “diversify” out of US dollars. Say more about Paulson appointment or Snow removal
az, I have a sibling who does occasional consulting work for hedge funds in the area of clothing manufacturing and retailing. When Paulson was in the process of being brought into the Treasury department, the talk among the hedgies in suburban Connecticut was that his purpose at Treasury was to manage the falling dollar. This was spoken about in a very matter of fact manner, no big secret. I can’t give you an “official” announcement of this fact. No one is going to make that sort of “official” announcment. But please note Paulson’s “dollar diplomacy” trips to Asia, similar to State Department visits to other countries to work out foreign policy. I’m sure the health of our food supply is a bargaining chip.
Meanwhile, have some fun: Give a Hedgie a Wedgie Today!
Deficits (especially trade) that are at record levels need to be brought back into balance. They say deficits don’t matter, but what else are they going to say in their elite positions? There are only two ways to make it happen. One is through tariffs, the other through depreciation of the currency. Both have been used throughout history.
I recommend reading the book “The Gold Wars.” It is a very good summary of the depreciation tactics used by global central banks back in the 60s to adjust imbalances when on the gold-exchange standard. If you take the time to read it, your questions will be answered. You’ll also be livid at the arrogance of central bankers, but that isn’t all bad.
I think it was Bob Pisani this morning who said “As countries like the UK, Japan, and China raise interest rates, and the US holds steady….its a de-facto lowering, You have to think globally”
Well, a German steel company is building a $4.2 Billion mill in Alabama. Mabye a cheap currency will make the US competetive again? It’s the only way to prevent every single job from leaving. Europe and Japan will feel the pain - priced out an imported BMW lately?
“Who is going to fund (subsidize) a $100 K or less wage earner with a $500K obligation holding a declining asset?”
1. Wells Fargo [not doing much subprime anymore; also not #1 due to reclassifying servicing business]
2. HSBC Household Finance [HSBC's subprime erased at least half of '06 earnings]
3. New Century [funding pulled; lending halted, lawsuits, criminal probes, impairments]
4. Countrywide [subprime to hurt results; layoffs]
5. Fremont General [2007-03-02; residential subprime activities ceased]
6. Option One [Sold! to Cerberus.]
7. Ameriquest [ACC's formerly-major retail subsidiary]
8. WMC [subsidiary of GE Money; layoffs, subprime causes $373mln hit to Q1'07 profits]
9. Washington Mutual [some branch closures starting late 2006]
10. CitiMortgage [tightening standards]
…
http://ml-implode.com/
FHA?
Fannie Mae?
Freddie Mac?
“FHA?”
There’s your answer. Homes in generally good condition with at least 3% equity will be refinanced to a low fixed rate backed by the FHA. For those with negative equity and horrific credit…not so nice.
People will get “locked” into a fixed rate. And these programs are hoping they can throw away the key.
Bad Andy - you do know that “equity” and “condition” are determined by appraisers, right? And if the appraiser says the property has equity and is in an accepable condition, then FHA will insure it. Just how much faith do you put in appraisers, anyway?
” you do know that ‘equity’ and ‘condition’ are determined by appraisers, right?”
Have you had misfortune of dealing with an FHA inspector? They will go over that house with a fine tooth comb! That’s who determines condition for FHA.
As for the appraiser…there are honest ones and dishonest ones. FHA backed loans are inspected by underwriters a lot more closely than the typical loans…trust me
I didn’t say it was the right answer, but if you have a FB that really wants to stay and they show 3% and CAN AFFORD the payments why wouldn’t you want to give them that option?
Actually, I don’t trust you. There’s no such thing as an “FHA inspector” separate and distinct from an appraiser. And since 1995 FHA doesn’t pick the appraiser. And FHA loans are underwritten by the loan originator in almost all cases. FHA re-underwrites a sample, just like Fannie, Freddie, and the PMIs do - nothing uniquely stringent about them.
“There’s no such thing as an ‘FHA inspector’”
My first home was purchased with an FHA loan. There WAS a separate FHA inspector. I don’t know if that’s still the case, however as I said before there IS an inspection required for an FHA loan. Whether there is an inspector or not is irrelevant. These loans are MUCH more stringent.
In Palm Beach County the most they will insure is $362,790 and you MUST meet debt to income ratios as well as have reasonable credit.
Again, not a solution for every FB, but a solution for many.
http://www.hud.gov/fha/choosefha.cfm
“Less than Perfect Credit - Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan. ”
http://www.pueblo.gsa.gov/cic_text/housing/inspection/home.htm
“FHA does not guarantee the value or condition of your future home, and FHA does not perform home inspections. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, nor can it buy the home back from you.
That’s why it is so important for you, the buyer, to get an independent home inspection. Ask a qualified home inspector to thoroughly examine the physical condition of your future home and give you the information you need to make a wise decision.”
Let’s try this again. Comments says I posted it, but it doesn’t show up.
http://www.hud.gov/fha/choosefha.cfm
“Less than Perfect Credit - Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan. ”
http://www.pueblo.gsa.gov/cic_text/housing/inspection/home.htm
“FHA does not guarantee the value or condition of your future home, and FHA does not perform home inspections. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, nor can it buy the home back from you.
That’s why it is so important for you, the buyer, to get an independent home inspection. Ask a qualified home inspector to thoroughly examine the physical condition of your future home and give you the information you need to make a wise decision.”
What’s the minimum score for FHA? I know you have to document income.
“What’s the minimum score for FHA?”
No such thing. They look at payment history for 24 months on most things. They look very hard at rental/housing payment history and will overlook some things if that payment has been kept up. If you have a foreclosure or bankruptcy in your past, that credit record had better be spotless for at least 24 months after it.
OK, once again Comments says Duplicate post, but several minutes later, a couple of Refreshes, and nothing is there. So I’ll try again.
http://www.hud.gov/fha/choosefha.cfm
“Less than Perfect Credit - Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan. ”
http://www.pueblo.gsa.gov/cic_text/housing/inspection/home.htm
“FHA does not guarantee the value or condition of your future home, and FHA does not perform home inspections. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, nor can it buy the home back from you.
That’s why it is so important for you, the buyer, to get an independent home inspection. Ask a qualified home inspector to thoroughly examine the physical condition of your future home and give you the information you need to make a wise decision.”
Why do you keep saying “they look at?” It’s an automated underwriting system - it gets the FICO scores, incomes, payments, reserves, and spits out an Accept/Reject decision. Less than 25% of FHA loans have a human looking at them at all. If the scorecard says “accept” based on the inputs, it’s accepted.
“Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan. ”
As long as that bankruptcy is 24 months old you’re much better off getting an FHA mortgage. As long as you have 5% cash down you can get a pretty traditional home loan at a good rate 12 months out of bankruptcy.
They don’t have a minimum FICO score, but when FHA’s actuaries did statistical analysis on FHA loan performance they used FICO score range categories down to 400.
see the table around p. 20 for FHA’s Actuarial Review for 2006
http://www.hud.gov/offices/hsg/comp/rpts/actr/2006appc.doc
“Less than 25% of FHA loans have a human looking at them at all. If the scorecard says “accept” based on the inputs, it’s accepted. ”
Computers have programmers that input standards. That’s who THEY are.
“I didn’t say it was the right answer, but if you have a FB that really wants to stay and they show 3% and CAN AFFORD the payments why wouldn’t you want to give them that option? ”
Because, as housing prices slip 30-40% (or more) in many areas, that 3% equity turns into the owner being WAY upside down. When they realize they are way overpaying, they walk. When they walk, the loss comes out of the U.S. Treasury.
This isn’t to save the buyer that bought at the top. It is to save the banks that see the current forecolsures as just the tip of the iceburg.
“I didn’t say it was the right answer, but if you have a FB that really wants to stay and they show 3% and CAN AFFORD the payments why wouldn’t you want to give them that option? ”
Because, as housing prices slip 30-40% (or more) in many areas, that 3% equity turns into the owner being WAY upside down. When they realize they are way overpaying, they walk. When they walk, the loss comes out of the U.S. Treasury.
This isn’t to save the buyer that bought at the top. It is to save the banks that see the current forecolsures as just the tip of the iceburg.
But guys arent yuou missing a bigger picture? FHA wont insure a home valued over , what is it now 365K? Here in the DC Metro area that is section 8! And my thought here is if they could have afforded a fixed rate in the first place they would have gotten one. Its the thought of moving a house from inventory let the buyer figure out later……
“FHA wont insure a home valued over , what is it now 365K?”
This is part of the proposal snaking through CONgrass. They want to raise the conformable limit and throw away the 3% downpayment requirement — essentially turning the FHA into a govt insured subprime lender. Hopefully Ben and others who post here are correct that this will not prove a significant factor.
Comrade Stucco, we can add subprime lending garauntees to the list of essential gov’t duties.
I’m sure they have had a very good look at how things are done in the Dutch housing market; most of these new proposals sound VERY familiar and of course the idiot price levels in the Netherlands prooves that such stupid measures work - until they don’t.
From Washington City Paper, a short squib about another possible use for a bubble purchased house that could support the loan payments (other than growing maryjane):
In…Orange County, authorities arrested five men and one woman who they say may have operated as many as 31 brothels in Southern Califorina. According to the district attorney’s office, the suspects kept costs down by providing patrons with plastic food wrap (which the alleged ring leader purchased in bulk) rather than condoms.
Yuck.
Saran-Wrap: for when it just can’t wait.
I noted a couple of weeks ago that I work at a company that prints boardgames for people and had gotten 5 or 6 real estate-oriented requests in the past couple months (after zero for 2006). I just got two more in this week. As a lagging indicator, I’d say this shows things are getting much worse. If you have to teach how to buy or sell using a board game, you’re shooting a bit low.
Given the cost of producing a board game, most of these games will never get produced, but it’s interesting to see everyone working the angles on the way down.
Could you provide some contact information? My brothers and I invented a board game some time ago that we thought was a lot better than the ones we had seen before, but never knew who we could contact to get it printed. Also, how much is the minimum order likely to be with a fairly standard board without fancy graphics, etc.?
Thanks.
I heard on the news today that Philadelphia is the worst place in America to try and sell a house right now. Anyone have a link?
I’d be willing to bet that FL and CA have them beat.
You’d think. But that’s what the local news said and then they had a Real Estate agent on to refute it. But I haven’t been able to find the story. It’s killing me.
What local news channel? Check their website.
Fox 29 in Philadelphia.
Their website is useless. I checked there http://www.myfoxphilly.com
PoodlePoodle?…… No soup for you!!
I live in the western Philly suburbs and the $700,000 40 year-old home on one acre around the corner from me sold in three weeks. It was listed for $700,000. Homes under $900,000 are moving in my area.
“I once spent a year in Philadelphia, I think it was on a Sunday.”
W.C. Fields
Driving through the Rockford, IL area yesterday and heard a radio ad that started with: “facing foreclosure? Call 1-800-xxx-xxxx and ask about the new law”.
It played several times according to my wife (I tend to filter out radio jabber).
Anyone out there aware of a new foreclosure law in IL?
Just curious… what do the Florida folks think about building your own home in today’s housing environment? My husband & I need a bigger place and most of the options available at the moment in the area we like are FBs who I don’t care to rent from. I also don’t want to pay over-inflated ridiculous prices for cracker box homes….and we all know the “quality” of homes that have been built in the last 10 years. Anyway, we are considering building our own house in the next 1-2 years if we can find a decent piece of land… Is this still a viable way to save money and control the quality of the home being built… or has the bubble ruined that too?
Mystry, I don’t know what part of Florida you are looking in, but I understand what you mean about the FBs renting out their homes. The people wanting to rent out their places around here are absolutely insane, with no sense of the rental market and an over-inflated idea of what their home is worth.
I don’t know what to tell you about building. Generally, I think it is a good idea, but you will have to hunt for someone capable. They are out there, but hard to find. If you do find someone and decide to build, make sure you do your due diligence on the area in which you are building. If there are large pieces of undeveloped land nearby, proceed with caution, you never know what can happen with those. However, if you find a piece of land in an established neighborhood that is stable or even upgrading, go for it.
Hey Palmetto…. I’m in Tampa (Westchase area). Although I’d like to stay in the Westchase area, it’s not really affordable for the kind of house that would accomodate our needs. If we build, we will probably build in Plant City. We have looked at several 1+ acre lots North of I-4.
My biggest worry is that building is no longer the “bargain” it used to be. I’m concerned that building materials have skyrocketed leaving building your own home just as expensive as buying the overpriced cracker box.
buildign costs should remain about the same, the lack of demand will lower the costs some, but the increase in gas (and gas contributes a lot to new construction) will raise the price.
However you shoul dbe able to get a a General contractor and subs for much lower than in the past.
The real decision should be the price of tha land, access to water/sewer, and in florida how likely is it to flood. Land prices shoudl start a crash a bit before the hoem prices do, but i don’t think land prices in florida are anywhere near bottom.
HA! We are going to start building soon in Spokane, WA. The “good” builders are available and anxious to work, unlike 2005 up to Fall of 2006. Lumber has come down in price approx 40% since the boom times. Finding close-in raw land is the big problem and we looked for well over a year and bought directly from the owner(no realtor involved!!!) who considered moving from California and building in early 2006 and found building costs too high.
Good luck to you—-we still look at houses coming on the market and would buy if a well-priced home in a good area became available. I just refuse to pay the asking prices for old infrastructure and poorly upgraded homes. Spokane is still considered a hot market. If you build be sure to overinsulate and consider geothermal heating/cooling. Build for the future or don’t build!
And in Florida I would definitely look at building a concrete-reinforced home. I remember seeing a photo of a coastal subdivision in Mississippi in the aftermath of Katrina. The entire subdivision, completely wiped off the face of the earth, except for one lone house - built from reinforced concrete, with a few shingles missing.
I doubt it’s cheaper, but you could probably self-insure against a hurricane. That’s got to lower costs a lot in Florida now.
http://www.monolithic.com
how do you screw up ABS and a slab ?
So, here’s my question…. do you think it is possible to build a modest 2200 - 2500 sf home in eastern Hillsborough County for around $200K? I’m not looking for fancy granite counters or other luxuries a la the FBs of late (but I’m also not looking to completely “cheap out” and have shoddy workmanship either) We want a quality built, modest home with enough square footage to fit our needs and give us some room to grow. Are we out of our minds with that price in mind?
mystry,
try 100 per sq ft. plus or minus but that will not include sewer, driveway, permits etc…google house plans and you will see a bunch of free looksees and they will give you an idea…
but 100 a sq ft is a reasonable WAG.
Thanks! That gives me a place to start.
markets w risng prices
not according to this
http://www.housingtracker.net/
just oil patch and some corn folks= period
So the wife and I are in Nashville area thru Saturday getting a feel for the area. There is denial of the bubble here. Nashville is different. We haven’t found one house yet that compares to what’s currently avaiable in CA. Prices even are not that dissimilar.
Once I’m baxk home I’ll give a better report.
TN is so cheap- how much lower can it go ?
decent influx of half backs from FL
The only cheap stuff we’ve seen is in BFE or terribly outdated. New and near is as bad as CA.
That’s really too bad. Vanderbilt is one of my target universities. If I had job offer from them, my car would be packed tomorrow. I want out of CA that badly.
Gwynster;….I consider the area that you live (Davis) realy neat…Particularly compared to the bay area… It appears that you can afford to stay but still want to leave…
Dave: Davis houses are ‘way overpriced - less than the bay area but more than nearby Sacramento. I think Gwynster is waiting for prices to come down. Is that right, Gwynster?
But could she get a ‘Murder Burger’ in Virginia? (Is there still a Murder Burger in Davis? I may be 10 years out of date with this…)
It’s now known as “redrum” burger - a victim of political correctness. But you can get an ostrich burger there and any flavor of milk shake.
I took a quick look at Realtor.com. There seem to be a lot of nice homes in the 250-300K range. In most of California that buys you a 1-2 bedroom condo.
I looked in Nashville, TN
Dude,
Go to Lewisburg….not that bad a commute to Nash..greaqt prices
Has anyone compared housing prices on Casaway.com to real valuations in their area?
In light of the never ending stories of homeowners getting over their heads in debt, getting “tricked” into signing for toxic mortgages, and losing their homes to foreclosure because they are “victims”, I’d like to take a second to give a “shout out” to my mom.
My 64 year old mom told me she recently made the final payment on her mortgage and is completely debt free. This is notable because she was a single mom who raised me my entire life by herself and without receiving any child support (i’m talking none, zero, zippy). She worked as a secretary and never earned more than $20,000 a year. Yet through discipline and shear will, she owns a nice single family house in the suburbs of northern Virginia free and clear.
She skipped the fancy vacations, she kept her cars longer than most people, and she didn’t wear the latest stylish clothes - things today’s “homeowning victims” wouldn’t dare give up (it’s their American right, you know). But my mom has something to show for her discipline and sacrifice - a fully paid for house that no one can ever take from her and the pride in knowing that she managed to do it despite tough circumstances. That is truly something to be proud of.
So happy mothers day mom, I’m really proud of you.
america needs work camps for dads that fly the coop
free roads for everyone
Yay for your mom, John!
Very nice. As a single mom myself, I hope I can provide as well for my son.
I paid for my own college (and teaching credential), and my wife and I save 55-65% of our gross monthly - all thanks to the upbringing provided by my MOTHER and GRANDMOTHER. Ma’s been single since I was four, and grandpa passed on before that.
Look for us all at the Padres game on Sunday! Wife and I usually buy the $8 seats in right field. But, for mother’s day, we splurged on the $38 seats near first base (huddled around a wheelchair space for grams who, at 82, has never been to a game - but watches every game on TV).
Go Moms (and Padres)!
-Rent
> a fully paid for house that no one can ever take from her
Unless, of course, she doesn’t pay her property taxes.
John,
Congratulations. Stories like your mom’s are tough but not as rare as many would think. It can be done but, as you note, not without sacrifice and self-discipline. Sadly, too many people are swept up in the emptiness of envy and view their self-worth in things acquired, not in relationships developed or in living a life responsibly.
I’ve met many people like your mom and many business “geniuses”. I admire accomplishments like your mom’s ten times as much as anything any “titan” of business I’ve ever seen accomplish.
Yay for your mom! Three cheers!
Nice!
My take on paid off mortgages is not politically correct. . I think a modest mortgage with low payments is preferable to paid off.
Why? Houses do age and need upkeep. Roofs are not cheap. The bank becomes your partner if the house is destroyed, like in a tornando, earthquake or flood. Your loss is their loss.
Inflation will make those borrowed dollars cheaper to pay off.
I like my emergency fund in cash. Never know when some quick cash will be needed. I have 50% LTV mortageges, at low fixed rates for 30 years, on all my properties, and lots of cash in the bank to make the payments. I sleep very well at night at 50%.
davidcee: Educate me. Do you mean that if a house is destroyed by flood or fire that you can get the lender to help with insurance disputes? And how do you guarantee that your lender is a bank? Everytime I turn around my mortgage is sold to a different lender, usually not a bank.
The next blow to overpriced bubble markets: Relocation paralysis…
—————————————————————————–
REAL ESTATE
Moving a mountain
Cooling housing markets make job candidates reluctant to relocate
By Amy Hoak, MarketWatch
Last Update: 12:02 AM ET May 11, 2007
CHICAGO (MarketWatch) — Convincing job candidates to relocate can be a challenge even when the housing market is strong. But with homes in many markets around the country taking longer to sell and prices either flat or declining, employees being asked to relocate are starting to balk in greater numbers.
“If you’re in a market where prices have declined significantly, that’s a huge challenge for folks who bought at the top of the market,” said Kathy Morris, director of global consulting for Prudential Relocation.
http://www.marketwatch.com/news/story/cooling-housing-markets-sour-job/story.aspx?guid=%7B382F6A8E%2DE393%2D4DBA%2DB8FF%2D2097B7103510%7D
Interesting story, but that would depend on the relocation package.
My companies is very desired:
RE commision
$50k (maximum) loss coverage
the move
temp housing
It also depends on the job market being left behind.
Got popcorn?
Neil
My husband and I are happy to relocate. We are not house bound! We don’t even have a lease.
That article is good news for contracting engineers and health care workers who have not gotten trapped in the RE bubble. People like us can move within a week notice. I may be going back to the south bay temporarily for a month in the peak of the Phoenix temps… Businesses will be forced to pay higher hourly rates for the temp engineers to fill the demand for those direct hire candidates who cannot afford to move from their ARM-prisoned house.
There is an ad on the radio (conservative talk show) from a company that will help you find foreclosures to buy. The funny thing is, it ends with ‘if you name starts with A-N, call now. If your name ends with O-Z, call tomorrow’. The exact same ad plays daily. I guess if your name starts with O-Z, tomorrow never comes.
typos….’ if your name STARTS with O-Z….;
No, it means that anybody can call any day. They’re trying to create the illusion that lots of people are calling.
I see the Plunge Protection boys on Wall Street are hard at work this morning strugging off the bad retail figures of late and even worse RE.
They need to leave their screens…get Mom a gift…it’s Friday, get it up in the morning…remember Dr. Demento background song…”Boyz like sex in the morning, Boyz like sex in the morning…
http://en.wikipedia.org/wiki/Dr._Demento
They have successfully stabilized the three headline indexes (DJIA, NASDAQ & S&P500) at a temporarily-high plateau at a level of 0.75% above yesterday’s close. They really have this price stabilization business down to a high level of precision.
http://www.marketwatch.com/tools/marketsummary/
Fire half the county employees..they are the deadwood.
http://weblogs.sun-sentinel.com/news/custom/propertytax/blog/2007/05/hallandale_vote_heard_in_capit.html
Here is an ad I found for New Hampshire. Wish I had access to those user remarks. http://www.beangroup.com/real_estate/listings/Homes/NH/Newton/558095
“Investor/Builder special. This house needs lots of finish work. Enormous house; much bigger than it appears. Soaring 3 story mezzanine. 3 levels of living space. Could be an amazing home. House needs major plumbing repairs. What wasnt stolen was frozen and/or under water. See MLS user remarks.
MLS # 2653204 offered at $246,900″
Who the heck would want to heat a three story mezzanine, let alone deal with the added hazard of this type of arrangement with children. Would the people who “stole” (repossessed??) the appliances come back for any other reason?
MLS # 2653204 offered at $246,900
Like so many older homes, what this one needs is a family or other significant group to fill it with life and hire architects and engineers as necessary to do the restoration. The huge void in the pictures does not belong there and is symbolic of the emotional emptiness that has played a role driving this bubble.
But outside of the volatile energy and food sectors, prices were unchanged last month, the second straight reading of zero for the closely watched core inflation index.
If we do not have inflation then why do we pay more for food ,clothing,services and other items not to mention ENERGY!
Interest rates have to climb or the dollar will sink like a hot rock in an elevator shaft! RE will continue to sink. HARD LANDING!!!
interest rates do not have to climb, as the rest of the world tightens rates (see UK, China, and Japan)….and the US holds, its de-facto lowering with continued erosion of the dollar. . . and the FED does not have to do a darn thing. (Bob Pisani told me to think globally)
Hi all,
I just had to post an experience I had the other day.
I ran into a guy I worked with a couple years back at a locally based mortgage wholesaler. I did some linux/unix work in their IT department and left under less than friendly circumstances when they decided that I shouldn’t be paid for coming in at 2am to fix someone else’s boneheaded mistake. Being that I was an hourly contractor with no benefits, I took issue with this and soon found myself another job.
I remember one person that worked there telling me “I would never borrow money from these people - they set a new bar for predatory lending practices.”
Anyway, so I run into a guy I worked with there on the bus the other day ad he tells me they closed their doors. They were heavily into tthe subprime market but get this: That’s not why they closed their doors. Apparently they were able to make all the buybacks and whatever obligations they had connected with their subprime business. They closed their doors because their primary funder(don’t know if my terminology is right) upped the fee for their loans subprime and otherwise, from 2% to 10% out of the blue.
They couldn’t afford to pay that and stay in business so they closed their doors.
So it appears that indeed, the subprime mess is spilling over into A paper business.
This doesn’t bode well for funding real estate purchases in general and thus the greater market.
Thanks for posting - great info.
Oh and I forgot to mention - he said they made the implode-o-meter! WooHoo!
http://sandiego.craigslist.org/rfs/328656386.html
$905000 Appraised at 908,000! Owner Will Cash Back!!!
2 blocks to beach
Owner will cash back 125,000
FSBO, No Agents, appraisal done last week
3 bedroom 2 bath 1400 sq ft detached SFR with 2 car garage
Home was bought in foreclosure, fixed up, and can be yours with a signifigant amount of cash at close! 7500 minimum earnest $$!!!
WILL NOT LAST PAST THIS WEEKEND
I’ve flagged it already…..
Kind of OT, but I’m curious as to why in the world the flippers bought SUVS and crap with their HELOCS. Hell at least I’d get a Ferrari or maybe a Prius and maybe something cool. The yuppie/flipper crap they sell sucks! Why oh why do they buy this stuff?????
Business Week is starting to sound like The Daily Worker. Check out “The Poverty Business”:
http://tinyurl.com/ynm4km
You’ve got to admit, those stories are pretty sad.
http://www.zillow.com/HomeDetails.htm?zprop=19839081
This is a house which sold in San Jose, CA for 569K 4/11/2007 the Zestimate is 673K
How can this be? I thought they would have the software with some logic.
You want some live coverage of the French real estate crash?
http://www.housepricecrash.co.uk/forum/index.php?showtopic=47256
I can’t view the videos myself, because I have no broadband internet. But this french guy seems to visit real estate agents all over France with hidden camera, proposing them to sell his investment property, to get to know the real state of the market, which seems really slowing hard. The videos are in French, but he hopes to do some in London soon…