Bits Bucket And Craigslist Finds For May 28, 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.
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Name:Ben Jones
Location:Northern Arizona, United States
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China/Stocks
http://news.yahoo.com/s/afp/20070526/bs_afp/chinastocksstudents_070526035731;_ylt=Aslt0gAM7j3TPtcSqTVEzT.mOrgF
Chinese college student stock investers = latter-day shoeshine boys…
‘China warns students to stay away from stock market
Sat May 26, 12:06 PM ET
SHANGHAI (AFP) - China’s education ministry has advised college students trying to cash in on the nation’s booming stock market to stay away, state media has reported.
“It’s inappropriate for college students to invest in stocks because their basic task is to study and establish the foundation for a career,” Xinhua quoted ministry spokesman Wang Xuming as saying late Friday.
“It costs them precious time and energy,” Wang said, adding that it was aware that many students had joined China’s stocks frenzy.’
New era? A cautious invesment letter says yes
http://tinyurl.com/2keov7
One investment conclusion:
“This month, take advantage of the stock market’s powerful uptrend by laying in a supply of undervalued blue chips like News Corp. (NWS: news), Target Corp. (TGT: news) and Toll Brothers, Inc. (TOL: news). A year from now, they should all be 20% to 30% higher.”
Now here is a “cautious” stock market guru telling folks that NWS (P/E=19.33) and TGT (P/E=18.12) are gonna be 20-30% higher in 12 mos. BUY NOW OR BE PRICED OUT FOREVER.
He includes TOL on his list, which tells me this guy has tunnel vision; doesn’t understand what the housing sector has got coming.
I do not subscribe to any newsletters. But when the MSM pushes ‘em it makes for very entertaining reading.
Got 10% down?
I don’t see that Peter Brimelow is totally cheer-leading for Mr. Band. PB injects his own sense of being “bothered” by Band’s arguments. Don’t be put off by these guys doing a lot of commentary on each other’s newsletters. Hulbert (as you may know) does NOTHING but follow other investment letters and try to see how their forecasts correlate with reality. Of course this activity may itself change outcomes, e.g., if Hulbert were seen to have an accurate forecasting method, then everyone would follow it and it would become useless. Well, my point is, YOU are right about TOL, and Peter Brimelow’s commentary is adequately balanced in its own universe.
If Hulbert and his ilk had accurate forecasteing methods, he would be on a fifty foot yatch somewhere in the Carribean placing his buy/sell orders from his computer and spending the profits on fun. I always question anybody anybody over fifty that has been predicting the market for 20 years and are still working, what happened? Crammer and all the other tooth fairies on CNBC are prime candidates. What happened???
Yeah - Warren Buffett - what happened?
Hmmm… How long had Warren Buffett under-performed the long-term US Treasury STRIPS? At least 9 years (closing in on ten years).
His time is past because lost of his long-term record is due to great record before 1998.
Jas
home builders have 0 exclusivity
why are they ever a good investment ?
“home builders have 0 exclusivity
why are they ever a good investment ?”
I think you meant to write, “homes have 0 exclusivity. Why are they ever a good investment?”
It’s not as if that “dream house” can’t be replicated over and over and over and over…. There are a lot of dream locations in this world. Houses are not snowflakes.
“Houses are not snowflakes.”
There is a true understatement, if you are talking about closely-spaced cookie-cutter 4br+ tract homes offered at $1.5m a piece.
“Water, water, everywhere,
And all the boards did shrink;
Water, water, everywhere,
Nor any drop to drink.”
SD foreclosure forecast:
http://www.signonsandiego.com/uniontrib/20070527/news_lz1h27smokes.html
“San Diego will likely face the worst foreclosure rates in its history in the coming three years,” said Gertz, a Sacramento resident who plans to go to graduate school in real estate or public health.
What’s more, Gertz, who based his predictions on mathematical models that he verified using historic data, said the peak number of 7,605 foreclosures he projects for 2009 represents a “best case scenario” because of the possibility that such failures could tip the local economy into recession and result in more distressed sales.
“Home price deterioration reinforces foreclosures, which reinforces home price deterioration,” he said. “This basic phenomenon is what causes the cyclical nature of the housing market as a whole.”
Amazing, someone does an unbiased mathematical study and it forecasts foreclosures going through the roof. I would like to see the whole thing
I don’t doubt Gertz’s predictions for SD. A certain difficulty I have with the surrounding commentary is [somebody's] notion that SD is a “bellwether” for the nation as a whole. This would suggest that As Goes SD, So Goes The Nation. I do doubt that. SD may lead a national trend in this respect, but I doubt any of us expects the nation as a whole to be as hard hit as SD.
at least you have weather and polite people.
try bahstin, NJ & NE for crashes
who wants to live there ?
What about regional interest rates. IMO, SD is more risky than other cities. That should be reflected in the interest rates. Credit scores only capture the individuals risk, not the market’s risk.
Why not? We already here about NODs and foreclosures across the states and we’ve only gotten started. Granted, the dollar losses in bubble cities will be the most severe, but the credit tightening and job losses will be felt everywhere.
“hear”, not “here”. Gotta proofread better!
We were able to get off this island and take a field trip out to beautiful New Jersey (Sussex County). It’s nice to see the real world, or a close facsimile, once in a while. I can sum it up in only one word, “DISASTER”. It was exactly as I imagined it would be. It might even have been worse. There are “For Sale” signs everywhere. Our friends tell us that nothing is moving, of course prices still haven’t come down much.
I kept hearing that, “you just have to be patient”. This is not a time for patience. This is a time for action. If you want to sell a house you need to make a drastic cut in the price and kill the comps. There is no other way. I’m seeing an entire market that will be chasing itself down.
There are bigger problems brewing as well. It’s obvious that the NJ economy is taking a major hit. I heard it coming out in casual conversations. Work for construction is way down and spotty. Somebody mentioned that boats aren’t selling at all. Other luxury items are stagnating as well. Complaints about gas prices were very prevalent. This is something that bothers me. You should not be able to go from the high life to complaining about gas prices in a matter of 6 months to 1 year. I have no hard evidence other than what I witnessed with my own two eyes and ears but I would guess that Jersey is already in a recession. It’s back to the unreality of New York, more worried than ever about the coming economic storm.
I was flipping through a yacht magazine recently while waiting on dinner and they were offering “no doc” loans on boats…
THE WEALTH REPORT
By ROBERT FRANK
Flip That Yacht
Rich Buyers Sell Unfinished Boats, Reaping Millions in Profits
Terry Taylor, a Florida car dealer, has purchased five yachts since 2001. But don’t expect to see him anchoring off the coast of Cannes this week. Mr. Taylor is boatless, having sold all of his yachts to other buyers for huge profits.
…
“The risk, I guess, is that the yacht market collapses,” says Billy Smith, a partner in Trinity. “But with all the wealth that’s being created, there are no signs that that will happen.”
http://online.wsj.com/public/article/SB118004846052414031-LWTe6TrhDhTxm72ZZYmfaiwOMi4_20070624.html
Remember, as soon as the masses start finding out about the party, it’s too late…
There’s an article in the Chicago Tribune about how gas prices are affecting boaters. Kind of off-topic, but what caught my attention was the mention of a sheet metal worker with a $300,000 boat.
http://www.chicagotribune.com/news/local/chi-boatgasmay28,1,5554523.story?coll=chi-news-hed
Maybe he inherited some scratch? It does happen.
‘I kept hearing that, “you just have to be patient”. This is not a time for patience. This is a time for action. If you want to sell a house you need to make a drastic cut in the price and kill the comps. There is no other way. I’m seeing an entire market that will be chasing itself down.’
From the other corner of the country, I attended a couple’s retirement party last night (friends of our family). They are trying to cash out of their San Diego home and relocate across the country
where the scenery is comparable and comparable housing costs a fraction as much. Realtor told them to list at $2.3m (based on “comps”), but they received no offers. Next they lowered the list price to $2.1m, $1.9m and now $1.7m, still hoping and waiting for a buyer to materialize. I could not get a straight story about whether the “comps” they priced off were current comparable listings, or recent sales results, but I had a sinking feeling in my stomach as a result of empathy for this kindly couple whose retirement savings are at least $600,000 lower than they had estimated a few months ago before they started trying to sell their home.
GS, maybe they can go back to work for a year or two to make up the $600k?
I would guess that less than 1% of San Diego households make 600K in a year.
I did not mean to imply all their retirement savings were tied up in their home — just that it appears they have $600K less then previously believed. But for all I know, this may not make a big dent. There are families out here with deep pools of wealth, and they look just like those of us who do not on the surface. The area where this couple lived is not exactly your low-end neighborhood, either.
That’s what happens when one’s nest egg is completely tied up in a non liquid investment like real estate. Now it turns out that their nest egg is only 75% (if not less) than what they were planning on. Still, $1.6 million is nothing to sneeze at. They are still better off than 99% of the Joe 6 pack demographic.
Comps are good for one day. Tomorrow the market could crash.
I was being a bit facetious. Point is, $600k is a lot of cash and would take me quite awhile to put away. That’s stashing away $5k/mo for about 7.7 years at 10%/yr. That much of a bump up for me today, and I clean out my office tomorrow.
If you want to sell a house you need to make a drastic cut in the price and kill the comps. There is no other way.
Kill the comps before they kill you. It’s do or die time.
zillow has my old man’s place in FL at 822K and he’ll take 750k
started at 1mill in late 05
=wow
in my hood 22151 zillow is on the money
In my area 91604 zillow is way off. Often the new mcmansions are reported at old sq footage which skews zillow big time. ie The comps for the house I’m renting are wrong. That 1300 sq ft selling for 2 mil is really a rebuilt mcmansion at 4000 sq ft and therefore shouldn’t comp against this modest 1400 sq footer. This misreporting is rampant in my area. AND the builders use the zestimate to boost up their prices as they have MANY projects in the area. I have informed zillow to no avail.
One local fraud specialist said recently that he believes fraud is much more widespread than the current report indicates…..
more and more fraud is being discovered in a cooling real estate market.
From a story in the North County Times regarding the growing mortgage fraud in California. (36.6% of all fraud reported is in CA):
http://www.nctimes.com/articles/2007/05/28/news/top_stories/52707180401.txt
The quote reminds me of Buffet’s oft quoted remark about not knowing who’s swiming naked until the tide goes out.
–
“Analysts say incidence of mortgage fraud in California most likely has been higher than reported for several years. It is only becoming apparent now as the housing market cools off and those who commit fraud can’t hide behind housing profits, they add. “California has nearly twice as many reports of fraud as the national average,” Larson said.”
I am shocked.
I will also be shocked when I read reports in the future about California leading the nation in personal bankruptcies (on per capita basis), in municipal bonds defaults, state bankruptcy, and Silly.con Valley is reported to have turned into a hellhole. I might even get a heart attack from such shocking news. Until then I can remain calm and collected.
Jas
desperation in S Fla..
http://www.miamiherald.com/884/story/119400.html
So the American dream is not that you can work and study and save so as to better your social position, and as a consequence of your frugality, over time earn the ability to provide dry, warm, safe housing for your family?
Instead, the American dream is that you can have whatever you want right now because you deserve it because you have plenty of self esteem and are a nice person, and that debt=wealth, and that anything to the contrary is just mean-spiritedness?
from that story:
Flight attendant Joann Soufisiavash bought a sprawling Miramar home for $459,900 almost two years ago using 100 percent financing and two mortgages.
Now she can’t afford the $2,800 payment (not including taxes and insurance), and her home in a gated community is in the process of foreclosure.
How did Joann’s “American Dream” tack an additional 50K on to the loan? Did the American Dream include a new set of Dow Cornings and perhaps some jewelry and a new car?
This kind of person in no way deserves any sort of taxpayer funded “assistance.” And what is a flight attendant doing “buying” a 450K house? I didn’t know waitressing paid that well these days.
Negative amoritization and she threw in all the costs of the loan and made an interest only payment.
However she knew what she was getting into - they all did.
I don’t like to say it, but I think its true. The only thing that will save this country is a greater depression.
Yeah, waitressing pays purdy good in America. Citibank’s new TV commercial shows a waitress at a diner who owns a classic mercedes convertible roadster. Evidently, if you want to own something a little bit more upscale (like a classic Rolls Royce Silver Ghost Boat Tail Speedster) then you better be earning $50k/year.
Got 10% down?
I worked in a restaurant to help put myself through college. Don’t let anyone kid you that waiters or waitresses - most of them, anyway - make bank. Most work very hard for what little money they make, plus every a**hole who gets dumped on at work or home, comes in and tries to dump on you. In addition, most waiters [guy wait staff] are lazy and only out for themselves, so the waitresses have to take up the slack on “common” chores [that customers don't see] like making coffee and rolling silverware. I tend to over-tip good waitresses, since I know a lot of them are barely getting by.
The median income for a flight attendant is $52,349 (more than I thought it would be):
http://swz.salary.com/salarywizard/layouthtmls/swzl_compresult_national_TR20000052.html
The house the bank bought for her was 8.7 times her salary. And, now, she wants hard-working taxpayers to bail her out.
The city of Miramar is absolutely stuffed with brand new construction, mostly of $300K+ homes. The city’s paltry $60,000 will very temporarily save maybe a dozen deadbeats. What will they do for the thousand or so others that will meet similar fates in Miramar?
What’s funny is my wife and I plan on buying in Miramar in 2009. Maybe Joann’s house will be available for $200K by that time.
I find that number to be suspect. My daughter was considering becoming a flight attendant, and at most airlines the starting pay was about $9 per hour.
Anyway, I put as much stock into salary.com’s numbers as I do into zillow’s.
I agree with that. If those numbers were correct I would be making enough to eat caviar out of a lobster’s a$$ every night of the week. I make half what salary.com says I should be making and I do well. They are telling people what they want to hear.
Yeah, I agree that their numbers are artifically high. However, that’s not a bad thing when you use their numbers for salary negotiations. I recently used a print-out from Salary.com to negotiate a $30K raise — my employer wanted to get me to the median level.
Flight attendant salaries: note that new hires make way less then incumbent jobholders due to the growth of discounters with no unions vs the shrinkage of legacy airlines with powerful unions. That median will be falling fast as the legacy airlines reorganize or die off.
Salary.com: I find that it’s pretty accurate for the fields that I hire in. You have to keep in mind that half of the salaries in the market are below the median
And frankly, more than half of the candidates that I have interviewed lately are well below my expectations - in terms of what I think the median skill set and knowledge should be for the positions.
Did anyone else read the article about the problems that the CA parks are having hiring workers? Since citizens wouldn’t take the jobs, and since English proficiency is a requirement (meaning Central and South Americans could not be employed), they were bringing in employees from former colonies and Europe. But since the USG visa infrastructure is broken, they cannot get employees any more and are running at about half-staff.
Gatorfan, check out Sunset Lakes in western Miramar. Some very attractive lake homes. Tons are for sale and not moving at all. Folks are desperate and there should be some good bargains soon. I have several friends who live there who think it’s great. Sunset Lakes elem is good too and one of the few that has a program for gifted kids (rare commodity). Just beware, last summer the was a huge croc in the lakes, it actually walked outta one, crossed Miramar Pkwy (a cop held up traffic for him) and entered another. Since it’s a croc and not a local gator it’s protected and critter control can’t do anything. Just one of the joys of south Florida living.
“Roughly half of owners of new homes in Miramar hold adjustable-rate mortgages, many of which will reset soon with higher interest rates, increasing monthly payments, said City Manager Bob Payton.
” ‘It’s alarming,’ Payton said. `These are hard-working people, and they have secure jobs. They just got locked up in a mortgage that’s not best suited for them.’ ”
Okay, so let’s say that I buy his line that these people just happened to end up in adjustable rate mortgages. How exactly would I reconcile it with this statement:
“But that program comes with income restrictions that disqualify many homeowners in the city, where the average home value is $451,915 for single-family homes and $246,000 for condos.”
Now, I realize this is the average and not the median, but even if you were generous and said that the median was around $300k for a single family house, you’d need a median income of at least $100k. However, looking at the city’s own website (http://www.commdev.miramar-fl.gov/econ/statistics.htm) we find that the median income ($58k) could not support the single family home price. And while there are other housing types available, the median price for all housing units is $215k, which is still too high for the median income. So, I would have to respectfully disagree with Mr. Payton about the reasons that his townspeople took out ARMs. Sorry guys, but 60 grand isn’t going to save your town.
Realty Q&A: Appraisers bristle on ideas on battling low valuation
http://tinyurl.com/2scruv
Interesting reading, appraisers write about the intricacies of their work.
Got 10% down?
Yes, a good read.
Comps are just one part of the appraisals I have seen, the other is the computation of replication or replacement value. This is basically price per square foot plus the value of the land. Conveniently, the two numbers were always equal in the appraisals I have seen, replacement value equaled comps.
So, my question for Calf, Az, etc is how does the replacement or replication part of the appraisal process add up to the hugely inflated prices people are asking?
In my area, 1400 sq ft houses on 5-7K sq ft lots (tiny) sell for around $300K. For the life of me, I cannot get this to add up. These are POS houses, relatively new, poorly constructed, maybe (being generous) $100/sq ft. That’s $140K. The other $160K for a tiny cookie cutter lot?? These lots were carved up from a former pear orchard, and there are 100’s of square miles of orchards around here. Granted, the agricultural zoning greatly restricts new building.
Something is very out of wack because there is no way “comps” equal replacement value. Maybe my $/sq ft is way too low…
If you think New Jersey is in a recession now, just wait until the next shoe drops. It’s going to involve very large layoffs in the financial services industry, across all sectors of the industry. The industry has bloated employment and payscales and riciculously low productivity. A lot of the disintermediation that the Internet has created in other industries has yet to kick into finance. We don’t need all these stockbrokers, insurance agents, mortgage brokers, bankers, etc. When was the last time you actually talked to a banker? But they’re still hanging around, drawing fat paychecks. I work in the business and can already start to see the layoffs. People get little or no notice in finance, either. Layoffs hits real fast when companies see the handwriting and decide they have to start cutting. Citicorp isn’t alone. These are the fat, high-wage jobs that prop up the Jersey burbs.
On the money. A lot of the back office jobs and support jobs that haven’t been outsourced overseas by ibanks are in places like Metrotech in Brooklyn and in Jersey City or Carlsbad. These are not the fat jobs, but the solid, middle class ones with health benefits and pension plans. When the ibanks start to cut back, they all do it at the same time, and it’s fast, fast, fast. And these folks are really vulnerable.
A sad by-product of the housing bubble:
http://tinyurl.com/2bh5wv
“OCEAN CITY — For 117 summers, generations of children have frolicked through Trimper’s Rides on this beach resort town’s signature boardwalk. But this Memorial Day weekend might begin the last summer they circle the antique wooden carousel, fling around the Tilt-a-Whirl and loop through the Tidal Wave roller coaster.”
“The Trimpers say they are considering closing the amusement park and arcade this year.”
“…In the past three years, family members said, their assessed property value has tripled, from $21 million to $65 million.”
Looks like the Ocean City boardwalk - a family-owned park for 117 years, may close due in large part to high property tax assessments.
That sucks. Not so much for the family perhaps, who will probably make tons of $$$, but for society in general, to lose things like this due to money, and specifically taxes.
I for one am a proponent of things like CA’s prop 13 - for things like this. While it’s true that someone whose property taxes have gone through the roof can usually sell for big $$ - sometimes it’s not about the money.
Hopefully these folks can hold on long enough for assessments to come back down.
Read further:
“At Coney Island, the vintage Astroland amusement park is scheduled to close at the end of this summer after 45 years in operation. A developer bought the park for $30 million and plans to build hotels and condominiums.”
How ’bout DEM apples?
Wouldn’t it be nice to just be able to increase your income any time you please ?? All in the name of “providing services” ??? $60,000. + per year water meter readers around here….Its just disgusting…
I for one am a proponent of things like CA’s prop 13 - for things like this.
Definitely a step in the right direction. One of prop 13’s weaknesses is that if you move (sell and buy a new house) they get you (there is an exemption for retirees). I like Colorado’s TABOR better. State, county and municipal income are capped to inflation and population growth. So while our house’s assessed value has grown about 40% since 1999, our property tax has only grown 5%.
It’s funny, but only on this blog have people raised a possibility that the MSM has totally ignored. That is…TOL and the rest of the large national homebuilding companies could mostly just fade away, become extinct. Think about what they do. They mass-produce homes to meet excess demand by arbitraging land, raw materials and labor. Who are their competitors? Existing homes, build-your-own, and smaller and more market-sensitive one-off builders. Even before housing prices turned down, their cost structures were greatly increasing, especially materials. Mass excess demand may never again be there, given demographic and affordability issues. Many retiring boomers are starting to sell out here and move to cheaper places abroad, especially Mexico and Central America. It’s not a fad. If you were 55 years old and had a GM pension of $35,000 a year, would you stay in Michigan and freeze in poverty. Or move to Quintana Roo and live on the beach like a king?
So, what may finally “do in” large national home-builders? Too much debt, not enough profit. On the whole, their balance sheets don’t look so good. Their bureaucracies are bloated. Smaller, more nimble local builders may come out ahead long-run. When growth slows down, debt always looks more expensive.
‘So, what may finally “do in” large national home-builders?’
So long as their stock prices always mysteriously move up on bad news release days, they will stay afloat. However, I see a serious risk they may ultimately share the same fate as the Japanese zombie companies, especially if forces in our government which are currently trying to pass housing market bailout measures are successful in their efforts.
http://www2.gsb.columbia.edu/ipd/j_bankingJAP.html
Or move to Quintana Roo and live on the beach like a king?
not any more. All the hot spots down south are becoming very expenisve, at least the areas that have any sort of American-style amenities (like roads, nice views, grocery stores, etc).
we priced out small condos in Puerto Vallarta, not on the beach, no great view. They come in around $200,000.
Small condo on or very near the beach: $400,000.
“Luxury” condo or nice home: $1 million plus.
large homes in Roatan (isolated island off Honduras): $1.8 million.
Same thing all over.
it’d be cheaper to just retire to a cheaper COL warmer American city like Mobile Alabama or down the coast from Biloxi MS for example
This bubble in many ways may be worldwide.
I agree DOC…..
You have to go off the beaten path. There are places in Mexico that are cheap, just not very glamorous. Places like Irapuato, Aguascalientes, Chilpancingo, Orizaba, etc.
What will do in TOL and other big builders? In the end, it comes down to cash flow. When the cash flow dries up, companies can not pay their bills and service their debt. TOL is terminal, IMHO. It is way out of line with the reality of affordibilty. The McMansion fad is fading and financing is drying up. I originally thought TOL would be bankrupt by the end of this year. It still is possible but now I suspect it will last until 2008. But when it goes, it will make a big bang!
Will their stock price finally correct in line with bad news?
The stock prices of TOL and the other builders will align with reality eventually. In the short term the Plunge Protection Team can support them in the face of devastating news but not forever.
I’m wondering if the business model of the large builders can support the kind of building that is needed going forward. I seriously doubt it.
Here in LA, believe it or not, we have a serious shortage of certain kinds of housing - particularly lower-middle-income. With expensive gasoline, a useless public transportation system, and horrific traffic congestion, there are a lot of workers who need to live closer to their jobs. From the nannys and housekeepers who spend 2+ hours per day on the bus, to the laborers and service people, to the routine office workers, a lot of people have a serious problem getting to work. I read in this morning’s LATimes about a housekeeper who made $80/day cleaning houses, who became a professional trash-picker in order to spend more time with her family by not commuting. Needless to say, at a significant reduction in income.
The relevance to housing and builders is that LA is looking to build small residential buildings in what are now exclusively commercial zones. One example given was Lincoln Blvd in Venice. But I don’t see how the big national builders can do that kind of construction and support their big infrastructure. We may see the return of the small builder doing infill development that the TOLs of the world could not possibly pull off. Their margin requirements are simply too high.
And no, I don’t see all those new condos in the Marina ever being affordable enough to house nannys and low-paid service workers - especially now that subprime is dead.
Something to think about.
Here we go on Craigslist
Stop foreclosure by suing your lender:
http://losangeles.craigslist.org/wst/lgs/333747875.html
subtle.
Ok, once again I get a realtor at work (grocery). She has her pin on, so I say “how’s business?” She says slow, alot of competition out there. Then she asks “are you looking to buy?” I said yes, me and 2 other people I know, but we’re waiting. She whipped out her business card so fast, says “don’t wait, prices are going back up, 5-10k. I’ve seen it.” I asked what about all of the foreclosures? Oh, you want a foreclosure? I’ve got the lists. Call me. I said ok, thanks, and as she’s walking out the door, she turns around and says Call me!!
It must be wonderful to be in sales droid mode 24/7.
I still think that its hilarious that they expect working class people to be able to afford 600K houses. They just don’t get it.
Prospective client: “What about all of the foreclosures?”
Realtor: “Oh, you want a foreclosure? I’ve got the lists.”
That is truly hilarious! The realtor was so quick on the draw, she was oblivious to the client’s concern that rapidly escalating foreclosures drop a guillotine blade on the value of new purchases.
was maybe posted before…..
ATA Truck Tonnage Index Falls 2.2 Percent in April
Trucking serves as a barometer of the U.S. economy because it represents nearly 70 percent of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods.
http://www.truckline.com/NR/exeres/682A9991-69BF-4D3E-9B7F-6475466984D9.htm
add this to the “goldilocks”……
Railroads Feel Profit Pinch as U.S. Automakers Trim Production
http://www.bloomberg.com/apps/news?pid=20601109&sid=a7bTsNVaAkVs&refer=home
“Automaker slowdown is contained…”
I let the Sage of Omaha look after some of my retirement funds…
So what is this all about?
http://biz.yahoo.com/indie/070516/819_id.html?.v=1
The dabate over foreclosure numbers was written up in the LATimes today:
Getting a fix on foreclosure data
Some people are losing their homes in this queasy market, that’s for sure. But how many? No one agrees.
Can we at least agree that the number of foreclosures is rising rapidly at an exponential rate of growth?
javascript:cnnVideo(’play’,'/video/offbeat/2007/05/28/burton.or.pgis.loose.at.home.kgw’,'2009/05/27′);
Shortcut may not work, but on CNN.com’s mainpage, there’s a video showing how some man destroyed his own home, and then locked three pigs in it - because he was angry at the foreclosure.
None of this should be surprising.
A buddy of mine bought a foreclosure from a bank in the mid 90s in LA. The place was trashed - broken appliances, toilets, holes in the walls, and graffiti (inside!).
Homedebtors often take revenge on the bank for doing what they are REQUIRED to do. If the debtor did what they are REQUIRED to do (pay their damn bills), *poof* - no foreclosure.
That place is not to far from my house, maybe I will go over there and take some pics…
That would be great if you could…
AFFORDABLE HOMES FOR EVERYONE!
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Agent News > Columnist Blanche Evans
Big Week For Housing Numbers - Is It Over?
by Blanche Evans
Both new and existing home sales numbers were released last week, but the totals suggest a disappointing spring market that is unlikely to be made up in the summer, particularly with expensive gas prices and higher mortgage interest rates looming.
According to the National Association of Home Builders, sales of new U.S. homes surged in April, ending months of declines. Sales rose by 16 percent to a seasonally adjusted annual rate of 981,000, reported the Commerce Department, which exceeds the 865,000 number that was widely anticipated.
What caused the positive report? Prices crashed in April, down 10.9 percent over last year, to a median price of $229,100. Builders discounted like crazy to move standing inventory, and stepped up in-house mortgage loan incentives to compete with the tightening broader lending market. The NAHB also reported that buyers are gravitating “toward lower-priced homes to counter their affordability problems.”
http://realtytimes.com/rtapages/20070528_bigweek.htm
Future Master of the Obvious Research Award candidate?
May 28, 2007
Written by Mark Heschmeyer
Link Between Falling U.S. Home Prices & Rising Subprime Defaults
The Less a House Appreciates, the Greater Risk of Subprime Default
In recent years, double-digit home price inflation (HPI) has helped keep subprime defaults to very low levels, according to Fitch Ratings in a new report.
Fitch analyzed the default rates, defined as the sum of 90 day+ delinquency, foreclosure, REO and bankruptcy rates, of loans originated in 2002 through 2006 and the cumulative housing price inflation rate following origination.
The analysis showed that subprime loans originated in the first quarter of 2006 have experienced only 0.5% of home price inflation after 12 months, but that defaults have jumped to 8.3% of outstanding mortgage balances.
“This contrasts starkly to 2005 full-year originations which experienced average HPI of 17% after 12 months and very low defaults of 1.7%,” said Glenn Costello, managing director.
“The low HPI is exacerbating the increased risk associated with these loan attributes,” said Costello. “Some of these borrowers are probably experiencing outright home price declines.”
http://www.costar.com/News/Article.aspx?id=A200881649754D698B7F358BEE32C2EA