These People Aren’t Buyers Anymore. They’re Sellers.
Newsday reports from New York. “The Oceanside splanch had been listed for eight months. There were about 25 showings and three offers. Then the buyers the owners were looking for showed up. ‘We were curious why the house was on the market for so long,’ says Danae Schneider. ‘We didn’t think anything was wrong with it,’ she says. ‘We just thought it wasn’t priced correctly.’”
“The agents first listed the 3,800- square-foot home for $929,000. After a month, the price was dropped to $875,000. Two weeks after seeing the house in October, Schneider and her husband, Jason, made an offer. They bought the house for $830,000 and moved there in February.”
“For Dominick Cusumano,r who closed on his house in Garden City in February, knowing that it had been on the market for almost a year was valuable fodder in the negotiation process.”
“The property was first listed with Coach Realtors Fennessy Associates in May 2006 for $1.85 million, where it remained until August, when it was co-listed with Dougall C. Fraser Jr. Inc. from September to December for $1.795 million. When Prudential Douglas Elliman received the listing next, the price was reduced to $1.62 million.”
“The house closed at about $200,000 less than the asking price (the sellers’ real desired price, says Daniel Guerrier, the agent who brokered the deal). ‘Garden City was overpriced two years ago,’ says Cusumano. ‘Now it’s more reasonable.’”
“Some 9,200 single-family homes are for sale in Nassau and about 13,000 in Suffolk. If nobody else listed, it would take about 10 months to sell the current inventory in Nassau and about 13 months to sell the current inventory in Suffolk.”
“Barbara Malley originally listed her updated ranch in East Setauket for $489,000 in October, but she has since come down to $469,000. Her listing agent and others say the asking price is fair.”
“Still, Malley says she has not received any offers. ‘I don’t want to wait until the house has been on the market for a year. If it is not sold by July, I’ll rent it,’ she says. She recently began to advertise in the city, and she’s considering putting her home up for auction.”
The Journal News. “The subprime lending crisis continues to shake the Lower Hudson Valley, as lenders stepped up foreclosure actions in April and two more troubled mortgage companies in the area reported more than 300 job cuts.”
“Lenders started 181 foreclosure proceedings last month in Westchester County, up 50.8 percent from April 2006. Putnam County had 41 actions last month, up from 22 in April 2006.”
“In Rockland, courts approved 94 judgments against property owners through the end of April, up 91.8 percent from the comparable period a year earlier.”
“The higher incidence of foreclosure, however, reflects the more difficult position that borrowers with less-than-perfect credit have found themselves in, and in numbers that have grown since last year. ‘The mortgage landscape for subprime lending has changed drastically in the last few months,’ said Michael Ettlemyer, spokesman for GE Money of Stamford, Conn.”
“GE Money owns WMC Mortgage Corp. of Burbank, Calif., which opened an office in Orangeburg in 2004. This spring, the Rockland office eliminated 171 jobs, with 98 remaining, Ettlemyer said.”
“WMC is one of two subprime mortgage companies that notified the state Labor Department this spring that they were cutting staff. The second, Fremont Investment & Loan in Anaheim, Calif., closed its office in Elmsford several weeks ago. A Labor Department report said 169 jobs were lost.”
“Despite the bad news, the trouble is unlikely to slow the regional economy, said Bruce Mason, chief economist and senior VP at Union State Bank in Orangeburg.”
“‘This is not affecting jobs. Jobs are not going down here or deteriorating in any significant level. The people are still employed,’ he said. ‘What it is going to affect is the real estate prices…These people aren’t buyers anymore. They’re sellers.’”
From New York Business. “New York state Gov. Eliot Spitzer on Friday announced an interagency task force aimed at combating predatory lending practices throughout the state.”
“‘Lending practices that prey upon the public cannot and will not be tolerated,’ Mr. Spitzer said in a statement. ‘This task force will take a comprehensive look at the sub-prime lending industry, and recommend steps to protect borrowers.’”
“Late last month, New York City Comptroller William Thompson launched a foreclosure hotline to help consumers that are falling behind on mortgage payments. The city is facing more than 15,000 foreclosures, according to data from the Neighborhood Economic Development Advocacy Project.”
“The AG’s office confirmed that it issued a subpoena to Manhattan-based real estate appraiser Mitchell, Maxwell & Jackson Inc., saying it was ‘part of an ongoing investigation.’”
“Jeffrey Jackson, co-founder of the firm, said the company is not a target of the probe, but is cooperating with the AG. ‘My take on what they re looking for is loan officers or mortgage brokers trying to influence us so they can make loans,’ said Mr. Jackson.”
‘The Hamptons’ summer real estate market has always been more of a curiosity than a barometer of Long Island housing. Saatchi, who’s been selling and renting in the Hamptons for more than 15 years, said this summer season is far from sold out. ‘It’s kind of late, but people are still looking,’ she said. ‘And there is more inventory, so you have more choices than you used to have.’
http://www.msnbc.msn.com/id/11770944/
Dateline NBC ran an excellent special last night on a French con-man who scammed a bunch of the glitz & glammer set at the Hamptons by claiming he was from the French branch of the Rockefellers. He separated a bunch of Beautiful [but Stoooopid] People from their money - it goes against the grain, but I was highly amused to see the guy ripping off greedy, clueless jet-setters [it seems they could have at least googled the guy before handing over huge sums of money IN CASH for him to "invest."] He grew up in an orphanage in France, the spawn of a criminal drunkard and a prostitute, and ended up ripping off something like $40 million from the jet set in LA and the Hamptons. The contempt he had for his “victims” was especially amusing - basically, he said all of them were easily ripped off because they were greedy and stupid.
I just saw a PPT Cruiser doing a money drop…
Flutter Happens
for the Byrds & the Bob:
Hey! Mr. Subprime Man, loan again to me
I’m not sleepy and there’s no place left for me to go to
Hey! Mr. Subprime Man, loan again to me
in the jingle jangle morning, i’ll be foreclosed on too
Though I know that Lendings Empire has returned into sand
Vanished from the FB’s hand
Left me blindly here to stand, but still not sleeping
My weariness amazes me, i’m branded a deadbeat
I have no one to meet
And the whole heloced empty street’s too dead for dreaming…
I went into Gilroy yesterday to Lowe’s and HomeDepot. Both parking lots were 2/3 rds empty. It is going to be one interesting summers watching the hotel/motel bookings, vacation travel, high cooling costs and high gas prices.
I agree about the summer travel. Gas may come down in price, but even if it does plans are being made now for vacations when the price is prohibitive.
And considering the majority of people put there gas on credit cards and the majjority do not pay balances off in full each month, let’s add an 18% finance charge to the price of gas.
“people put there gas on…”
oops…puth ‘their’ gas…
And while your at it, there is NO word in English that has two js next to each other.
Not that I think we should perpetuate the totally corrupted and useless spelling system that English has.
Increased chance of hurricanes in the Gulf of Mexico. Can you say $4.00 per gallon. How about a cat 4 hits Houston? Van you say $5.00 per gallon. Gas is not coming down folks.
I flew on a jet with a bunch of Home Depot managers and sales were not good!
Home Despot will disappear in 5 years like Builders Square. The RE Bubble coupled with Subprime/Alt-A/The Majors plus Peak Oil will be curtains to a lot of the Big Box outfits.
Gas is still cheap…wait till 2010-12.
Is anyone else getting ‘invited’ to seminars where they are pushing you to become ‘travel agents’ so you can buy your own vacation at wholesale rates? They offer you a package for just the time you are there (deeply discounted from the anytime package), but it is still $5000 up front? If you don’t buy right there, you have ‘forfeirted’ the opportunity forever. Opinions on such an ‘offer’? Others been to some of these? They make it sound like you can get a condo in Lake Tahoe for $199 for a week, and you can resell that on ebay for $300. Legitimate?
“Legitimate?” need-2, you are kidding, right?
time shares?
nice concept. build a hotel. sell it out for years to come to suckers willing to pay retail for a timeshare. make money on the recurring revenues, aka fees that all timeshare owners pay. the profits on the maintenance of the property far outweigh trying to make money on the leasing. and there is less risk since no one cares if there is less people traveling due to recession or whatever. people still have to pay the fees or face foreclosure
‘Is anyone else getting ‘invited’ to seminars where they are pushing you to become ‘travel agents’
- I thought that scam died early in the 90’s … as soon as the internet started to gain momentum travel agents were toast.
no, but no there’s an outfit in town that’s teaching everyone how to “play the market”. No admission price and supposely their handing out marketing kits worth $149 in value. I was thinking about going just to see see what the latest swindle is…but they only offer it when I’m wearing my Mom hat.
Hey Whine Spitzer…
Where were, say the past 6 years?
“‘Lending practices that prey upon the public cannot and will not be tolerated,’ Mr. Spitzer said in a statement. ‘This task force will take a comprehensive look at the sub-prime lending industry, and recommend steps to protect borrowers.’”
Agreed,
Politicians looked the other way. They now want to be perceived as doing something for political gain. There is nothing they can do now. It’s too late. The only think they will do now is make things worse, not better.
thing*
If their goal is to lock up the lending industry then I would say they are doing everything right on schedule. The ability to borrow money will be 10 times more difficult two or three years from now. That should take care of a lot of this stupidity.
Spitzer just became Governor in January. When he was Attorney General he went after Wall Street when GWBush was looking the other way. He has directed the new AG Andrew Cuomo to look into appraisal fraud and intimidation. He was part of a class action suite against banks that the Supreme Court recently said could not go forward.
He is one of the good guys and did not “look the other way.”
Ed,
I agree…Spitzer may not be perfect, but he beats anyone else out there. As AG in NY, he went after the ibanks, while the SEC sat on its’ duff.
Let all of the ‘borrowers (was going to have a mistype - boo rrowers) go down the tubes with the lenders. They deserve each others.
Check out the goofy poll in the Newsday article:
How about:
- 30 days
- 60 days
- 90 days
- 120 days
Ha! Yeah, in 2004-5 the best strategy was to overprice by $200k and then wait a year or less for the market to catch up. Just like the way to make the most money on “Flip That House” was to have no idea of what you were doing, blow through your budget by $100k and your timeline six months. But guess what? During those six months the market went up by more than $100k. The clueless made more money that the pros who were on time and on budget.
Never again in our lifetime.
Every day you have a house on the market is a day in hell. Is there anything more stressful than having your home for sale? Price it right to begin with and you will be fine.
“This is not affecting jobs. Jobs are not going down here.”
Elmsford, New York. 2000 pop = 4700, housing units = 1700.
Loss of 169 jobs lost at Fremont is partially balanced by the 49 Elmsford job listings that appeared in the local paper within the past seven days. The slow squeeze, like everywhere else.
I just saw this post this in the AOL Real Estate blog. Apparently a seller JUST discovered this fact and they wanted to spread the word, and keep in mind “buyers have been informed of market conditions”
http://journals.aol.com/unstructuredblog/Unstructured/entries/2006/11/09/for-sale-by-ego/90
Sellers beware!!
Quote from blog as follows:
“Buyers are technical and have been informed as to the
market conditions.
“if you don’t have to sell right now, then hold on.
This is a buyers market and they know it!!
Regina
Comment from hom4sell - 5/18/07 10:27 PM”
What are they going to “hold on” for?
2015? Good luck with that…
Here’s another classic from that site - “greedy buyers” must buy now “before it’s too late”:
“It’s just too bad that buyers are just as greedy and rude and don’t realize what they’re doing when they try to knock down the price of a home.
In the market area where we live at, prices are once again climbing. So, buyers beware, you’re greediness could cost you a house that’s at the right price NOW.
Buy now before it’s too late as home prices in certain areas are rising and we are one of them.
Comment from oceanlover58 - 4/25/07 7:49 AM”
Sometimes it’s better to miss the boat than it is to jump on board.
“The Titanic sails at dawn. Everybody’s shouting, “which side are you on?”.”
I will wave goodbye to the GFs from the dock. I like the safety of dry land.
Now that’s a great analogy!
Funny how people think the bottom has been reached at location x. All they need to consider are 1) Are the rents for the same square feet / amenities higher than the mortgage payment and 2) is the mortgage payment fixed and no more than 2 and a half times my annual income and 3) Am I very certain my job won’t be outsourced in the future? If any question cannot be answered with a “yes” then it’s still the wrong time to buy.
Sounds like the “industry” is doing all it can to keep supply down. They are trying to buy time, hoping for a miracle down the road.
I guess a great analogy is those Size 00 100lb 5′9″ models are considered “Normal” until they start dropping dead within 5 minutes after getting off the runway.
http://en.wikipedia.org/wiki/Luisel_Ramos
———–
the price was reduced to $1.62 million.”“The house closed at about $200,000 less than the asking price (the sellers’ real desired price, ‘Garden City was overpriced two years ago,’ says Cusumano. ‘Now it’s more reasonable
So many sellers feel if they can not sell at the price they want then they will rent it out.
Where do they expect all the renters will come from??
And how many tenants are willing to pay the price it would take to cover their mortgage, taxes and maintenance?
That just it BJ ,the sellers bought a property that would not cover the mortgage debt by the local rents/demand . Buyers bought these properties to flip and that was it and they got caught in the down-turn .
And how many renters are out there that will pay on time and not trash the place? Let’s assume this really is a $469,000 home. After the renters are gone she is going to have to put a lot of money into the house to get it ready to sell. I doubt the renters will leave the house in “staged” quality. She could easily be spending $20,000 or more just to get the house in “show” form.
Another idiot makes another bad decision.
These reductions sure don’t get my juices flowing. $1.85 million to $1.62 million. $929,000 to $830,000. No thanks. Here’s what these numbers should be and very well COULD be in a few years because ALL of the increases from 2004 until now will eventually get wiped out. If the economy doesn’t tank via a recession (which it looks like it will) then the $1.85 million could very well hover around $1 million, give or a take $100,000. The $929,000 could drop to $650,000 or even $550,000. Give or take $25,000. Buyers at these prices are just not paying attention to how much prices have increased in the last 5 years. It’s the same story as the 2000 tech rally (and every other boom and bust). Don’t think it could happen? How about the QQQQ’s hitting a high of $120 a share and finally coming to rest at $20. That’s just one example but there were hundreds of examples in that boom and bust. Guess what? As that stock was traveling all the way down from $120 to $20, investors were saying, “Now way can the QQQQ’s go any lower.” Anyone who buys in the next 2 or 3 years WHO DOES NOT HAVE TO BUY, is a GF on his way to being an FB.
not the Sopranos flava of Cusumano, eh?
“The house closed at about $200,000 less than the asking price (the sellers’ real desired price, says Daniel Guerrier, the agent who brokered the deal). ‘Garden City was overpriced two years ago,’ says Cusumano. ‘Now it’s more reasonable.’”
From today’s LATimes opinion section:
The housing bubble’s silver lining
“The bust feels bad, but the boom’s infrastructure and innovation benefit consumers in the long run.”
“So what has the United States gained from the housing bubble? Well, we certainly gained a lot of physical infrastructure. Broadly speaking, all that new construction and renovation (fueled by home equity lines of credit) has upgraded the nation’s housing supply. Yes, some of the homes built at the tail end of the bubble will be sold at deep losses. But towers of unsold condos in Miami won’t be torn down. They’ll be turned into hotels or office buildings or dormitories.”
And no doubt, prices will continue to “move sideways”.
Or section 8 housing.
Got 10% down?
Aren’t there only a limited amount of slots for eligble needy folks? Also, isn’t section 8 supposed to be for single mothers?
There are limits on Section 8 slots, but it’s basically available to anyone last time I checked.
Section 8 from what I hear here in Ventura is that anyone with income below a certain level, ie. family of 5 is income below 74,000 here in V.C. can qualify for Section 8 and qualify for a 3 bd. SFR voucher upto $2000/mo. and the applicants portion is 30% of gross income.
new construction and renovation (fueled by home equity lines of credit) has upgraded the nation’s housing supply.
BS…
Most of the residential housing thrown up today is junk construction put together with unskilled immigrant labor.
They’ve been foisted on dimwits with with fraudulant home inspectors and crooked appraisers punchin’ in 30 year remaining economic lifes on the FNMA 1004 appraisal form to set up a 30 year loan frame.
The spin doctors don’t get it.
I so agree with this.
With energy costs guaranteed to rise, no effort was made to design homes with maximum efficiency, or to install geo-thermal systems or upgraded materials for insulation, like rasta…
All the opportunity to build sturdy, efficient homes with sustainable materials blown and all the money wasted.
Instead, cheaply constructed crapboxes,thrown up by unskilled illegals with size and a slab of granite the only selling points.
The dimwits knewit was being built by illegals, just ask them, and they’ll tell you it helped with the price. When it falls apart in five years, they can consider what cheap, dumb labor really cost them.
It’s rastra not rasta, mon.
Also found in the AOL Real Estate blog, apparently from a frustrated seller (this post is almost month old now). There appears to be a little confusion about the nature of capitalism.
“I understand what the sellers are going through…When you put a lot of money into the house and it looks a lot better than when you first bought it, especially if it was a resale home like ours. You have every right to ask for a tad more on the sale price of the house. That’s all we’re asking, we’re not asking for a half million dollars because in reality it’s not worth that. At time we had this house appraised last year it was worth close to a half million but not even I would pay for that!..”
“It’s just too bad that buyers are just as greedy and rude and don’t realize what they’re doing when they try to knock down the price of a home.”
“In the market area where we live at, prices are once again climbing. So, buyers beware, you’re greediness could cost you a house that’s at the right price NOW.
Buy now before it’s too late as home prices in certain areas are rising and we are one of them.”
http://journals.aol.com/unstructuredblog/Unstructured/entries/2006/11/09/for-sale-by-ego/90?numComment=all#Comments
“The Last 30 Days (Apr’07 data)” publishes similar data for Santa Clara County at:
http://www.viewfromsiliconvalley.com/id330.html
Coming soon: a breakdown of the implied size of the 2005, 2006 and now 2007 median house…
Thanks!
Ha….
“In the market area where we live at, prices are once again climbing. So, buyers beware, you’re greediness could cost you a house that’s at the right price NOW.
Buy now before it’s too late as home prices in certain areas are rising and we are one of them.”
Sounds like the “next 100 callers get this discount, better act fast or you are out of luck!” then wait….1 hour….same commercial. Freaking moron you would have to be to buy this line, however people who saw an appreciation of a house under 10% for years can’t understand this concept either. That house that was 310k in 2000, then 325k in 2002, then 750k in 2006 is not really worth 750k or 500k….how can they not understand this. On my next house I purchase I am going to have a lesson on economics and bring pie charts and graphs, and let the mouth breathing RA sit there and scream at the owner to not look into the light.
Old Mason-Dixon Line: Geographic
New Mason-Dixon Line: Economic
And Mason, you are just another e-CON-omist, a know nothing, updated…
http://en.wikipedia.org/wiki/Know-Nothing_movement
“Despite the bad news, the trouble is unlikely to slow the regional economy, said Bruce Mason, chief economist and senior VP at Union State Bank in Orangeburg.”
’ Mr. Eliot Spitzer said in a statement. ‘This task force will take a comprehensive look at the sub-prime lending industry, and recommend steps to protect borrowers.’”
Eliot, I hope that the first step that you take to protect buyers would be to verify their income to support fixed rate payments.
As the Dot.com prices slid there were foolish buyers who bought stocks well before they hit bottom.
They listened to the Kudlow’s and Cramers of the world tell them it was a great time to buy and they had once in a life time chance.
They left out the rest of the sentence ” A Once in a life time chance to lose your shirt.”
William, the heedless Thomspon gunner (with apologies to Warren Zevon)
“Late last month, New York City Comptroller William Thompson launched a foreclosure hotline to help consumers that are falling behind on mortgage payments. The city is facing more than 15,000 foreclosures, according to data from the Neighborhood Economic Development Advocacy Project.”
Fair prices? Interest rates are low, the NY area economy is strong, and your competion is overpricing their houses. It is an ideal situation to sell, and if you can’t, your price is too high.
And if any of the above changes, “fair” prices are going one way — down.
“The higher incidence of foreclosure, however, reflects the more difficult position that borrowers with less-than-perfect credit have found themselves in, and in numbers that have grown since last year. ‘The mortgage landscape for subprime lending has changed drastically in the last few months,’ said Michael Ettlemyer, spokesman for GE Money of Stamford, Conn.”
That is quite a leap of logic to limit the higher foreclosure rate to subprime borrowers. I would love to see the breakdown of foreclosures into subprime, alt-a and prime.
Here is some FDIC charts. The first shows prime conventional loan delinquencies in CA approaching 1.5% of all loans, http://tinyurl.com/3bolwy
and the second shows the subprime delinquencies as a percent of all loans at around 8%, http://tinyurl.com/2m2w5t. FHA is near 8% and VA is near 4%. So I’ll give Ettlemeyer the edge for subprime for now, but what about Alt-A which is about to do the tsunami reset action in the next year or two? It will be interesting to see those percentages when that happens. I wonder if the FDIC folds Alt-A into prime or subprime? The FDIC gets this data from the Mortgage Bankers Association and they do not specify where Alt-A falls. But on their site I did find a citation( http://tinyurl.com/yv9tmw ) from a report released 12/13/2006 that reads,
“We expect the housing market to fully regain its footing in the middle of 2007. In the meantime, we anticipate some further increases in delinquency and foreclosure rates in the quarters ahead,” said Duncan.
I wonder if Gary Watts went to work for the MBA because we are only days away from “the middle of 2007″ and IMO I do not see the housing market regaining it’s footing. Maybe the next report will claim it is an inverted year.
We walked from the travel center. This company says they changed to this method because of the internet.
I had a friend in the LA basin that owned a house free and clear (in Rancho Palos Verdes). He rented to someone for 6 years. He said that whatever he collected rent was spent somewhere on the house maintenance. Luckily, thanks to my reading this blog (thank you Ben), he sold the house in Sept 2005 to this same man (who then overpaid) right before houses there started to fall. He couldn’t sell until then. All these flippers that think renting is the answer should hear my friend tell them what they will be in for.
http://tinyurl.com/375u87
Gloom settles over housing market
By Greg Robb, MarketWatch
Last Update: 12:01 AM ET May 20, 2007
WASHINGTON (MarketWatch) — The spring housing market is turning out to be something of a dud, dashing hopes of a turnaround.