Seeing The Domino Effect In Florida
The Herald Tribune reports from Florida. “Many of Southwest Florida’s home builders continue to struggle with a sluggish market. Pulte Homes announced Wednesday that it was cutting nearly 2,000 jobs nationally in a massive restructuring aimed at saving $200 million annually. The company said that the slowdown has left it with overhead that far outstrips demand for its houses.”
“The cuts mean that as many as 25 percent of the 55 employees in Pulte’s Sarasota-Manatee division will lose their jobs. Other large home builders in the region have made similar job cuts.”
“‘We’ve got to keep up with the competition,” said Steve Kempton, Pulte Homes’ Sarasota division president.”
“‘This is tough, but I don’t want people to think we don’t have confidence in this market,’ said Steve Kempton, Sarasota division president. ‘We’re just trying to right-size our business to position ourselves for long-term success in the Sarasota-Manatee market.’”
“In 2005, Pulte built 560 homes in the region worth about $170 million. The company has five developments in Southwest Florida, ranging from Manatee County town homes to Sarasota County golf communities. Prices range from $218,000 to more than $500,000.”
From TC Palm. “DiVosta Building Corp. executives said Wednesday the company will consolidate its Treasure Coast and Palm Beach operations to an office in Orlando and lay off an unspecified number of local employees.”
“‘My understanding is that DiVosta employees will receive severance packages,’ said Beth Cocchiarella, a spokeswoman for Pulte Homes, the parent company of DiVosta.”
“DiVosta is the fourth largest builder on the Treasure Coast. Since December, the company’s South Florida operation announced three separate layoffs totaling 266 employees.”
“‘We’re resizing the company to better position us to compete in the long-term,’ Cocchiarella said. ‘This is a result of the continued downward trends in the homebuilding sectors.’”
“‘This reflects another step that homebuilders are taking to cut back on production levels,’ said Brad Hunter, who follows housing trends on the Treasure Coast and South Florida for Metrostudy’s South Florida division. ‘As we undo some of the over extension of ‘04 and ‘05, naturally some builders have to cut costs and consolidate parts of their administration.’”
“Jack McCabe, CEO of a real estate consulting firm in Deerfield Beach, said the consolidation of DiVosta’s South Florida division doesn’t bode well for the economy.”
“‘We’re just about to see the domino effects of this,’ McCabe said. ‘What happens next year is you’ll see Circuit City, Best Buy, Brandsmart, all those big box retailers are going to feel that slowdown which was substantially driven by consumer spending and the housing market.’”
“‘With the loss in home values, credit tightening up and people saving instead of spending, there will be a substantial loss of jobs,’ McCabe said. ‘We’re definitely heading into a recession with all this pressure.’”
The Orlando Sentinel. “The Donald bails! Back in March I wrote a column on this pipe dream, a 52-story condo with prices starting in the million-dollar range. Did anyone really think downtown Tampa could support something like this? The real estate agent told me people would be moving in by mid 2009.”
“I said I’d dive in the Hillsborough River from the top floor if that happened. Looks like my bathing suit stays dry.”
“Real estate mogul Donald Trump has pulled out of the $300 million, 52-story Trump Tower condominium project in Tampa, according to a lawsuit filed Friday in U.S. District Court.”
“Companies have been distancing themselves from the project. Eric Fordin, a project director with the Related Group, a Miami developer that considered taking over the project, said Wednesday that ‘we’re not involved in the deal in any way.’”
“Fordin said he was launching a due diligence review for Related Group when ‘all these lawsuits started piling up’ against Trump Tower and SimDag, and the Related Group never entered into any agreements for acquisition or control.”
The Tampa Tribune. “City officials cheered last week when Gov. Charlie Crist approved $2 million for the Riverwalk project. But that euphoria is gone now that the Trump Tower condominium project, which promised to contribute up to $700,000 to build a prominent Riverwalk segment, is on hold while Donald Trump battles the developer in court.”
“‘If they do not build, then we’ve got a key connection that is not being made,’ said Lee Hoffman, the city’s Riverwalk manager.”
“For example, the Heights project developers are contributing $4 million to the project. Developers for Venu, a condo project in the planning stages for Kennedy Boulevard and Ashley Drive, promised to build an $800,000 piece.”
“SimDag LLC, the Trump Tower developer, was to build a 450-foot piece to connect the southern edge of the Brorein Street Bridge to nearby MacDill Park.”
“Mayor Pam Iorio said the city has a couple of options if Trump Tower does not get built. Tampa can build a regular sidewalk connecting the southern and northern ends of the Riverwalk and if a developer for the site comes through later, that developer can build its own Riverwalk segment.”
“‘Not a very appealing option,’ Iorio said.”
“SimDag’s troubles also could affect the Tampa Museum of Art’s new building. SimDag made a three-part pledge to the museum in 2005. The company made its first payment. The company was to make a second payment when the condo was topped off, and a final payment was to coincide with the grand opening.”
“An art museum official said Wednesday that the museum wasn’t counting on the money.”
“Even a power name like Trump may not be enough to save a luxury condo project in Tampa’s sluggish downtown real estate market. It takes money. Money from lenders. Money from buyers. In the end, SimDag LLC couldn’t come up with enough from either source.”
“‘In this real estate downturn, Tampa has been one of the hardest-hit markets in Florida,’ said consultant Jack McCabe. ‘And any time you have a negative stigma like this site has, it takes some time before people are willing to overlook it.’”
“The $300 million Trump Tower Tampa was announced in early January 2005, at time when Tampa’s condo market was coming alive. Developers were proposing new projects every month. If any of them would make it, experts said at the time, it would be the one bearing Trump’s name.”
“Even during the condo frenzy when the Trump tower was announced, lenders typically required developers to sell a set amount of units before getting financing. In the current market, however, some lenders require close to 100 percent sales. Now many lenders aren’t lending for condo towers at all.”
“National City Mortgage, which is involved in several condo towers in downtown Florida cities, has stopped partnering on others for now, said Paul Ramos, state manager for the company.”
“‘Banks may still lend on condo projects, but they want to know what your market is going to be,’ Ramos said, noting that his mortgage division still works with individual condo buyers but limits the number of units it will finance in each condo project.”
“Hillsborough County has enacted a hiring freeze and moratorium on new building construction in anticipation of budget cuts later this year. County Administrator Pat Bean also told employees to expect layoffs.”
“Residents will notice the cutbacks, Bean warned. ‘The loss in funds means citizens may experience limited access to some services and most programs will likely be scaled back substantially,’ Bean wrote.”
“The city of Tampa instituted a hiring freeze in April. Hillsborough government is one of the county’s largest employers, with a work force of about 6,000 people.”
“How long the hiring and new building freezes hold will depend on how much the county’s property tax revenue is cut. Officials estimate the cuts at between $46 million and $217 million. The county this year collected about $800 million in annual property tax revenue.”
“County Commissioner Al Higginbotham said Bean’s moves to freeze hiring and building new projects is prudent. He said commissioners simply don’t know how much money to expect next year. ‘How can we honestly discuss any new projects?’ he asked.”
The Post Dispatch. “Many builders have joined…in laying off people and selling excess inventory at discount prices, or at least trying to.”
“‘The Bank of America in Tampa (Fla.) called me the other day, and asked what kind of discount would you get in the market today,’ said a real estate developer. The developer spoke on condition of anonymity.”
“‘I asked what kind of property, and they said ‘a lot of scattered homesites with almost-finished homes, about three or four subdivisions, about 80 lots.’”
Although it’s clear that RE values are sinking throughout the country, there are small pockets of sustained high prices. To cite one example, my sister owned a POS house in Coronado (a suburb of San Diego). Because of a severe medical problem which wiped her out financially, she had to sell her house. The house was small, dark and dreary – you wouldn’t let your dog live there. Her neighbor, an architect, offered her $1.1 million for it. She and her (now deceased) twin sister bought it for $67K in the early “70s. My wife and I were astounded at the offer and needless to say, my sister accepted. One nice part is that there was no RE commission involved. This was about three months ago.
Coronado is a very nice place with virtually no building lots left on what is essentially an island. Obviously, the house is a teardown – it’s the property that’s valuable, even though the lot is pretty small. My sister is now renting a very nice, bright 2/2 apartment that is very convenient to everything by foot or bike (she doesn’t own a car) and she now has health insurance.
On another note, my wife’s brother died of cancer last year. He lived in Scripps Ranch, another suburb of SD. My wife was executor of his estate and put his house, a nice, but nothing special 3/2 plus a den, on the market for $800K. (The kitchen is very small and open to the family room, but it has a nice pool). We were offered $750K (about 4 months ago). His (divorced) widow wanted to hold out for the full $800K … “because a similar house in the neighborhood sold for that”. Thanks to the sage advice we got from this blog, and a few other places, we ignored her and took the $750. I doubt that it would sell today for $600.
Lakeside,
things worked out well for your sister. Congrats. Nice story.
funding retirements!!!!!!!!!!!!!
Thanks, Spike
Sometimes you have to watch out for “historical buildings” codes depending on when a structure was built. If some bureaucrat believes this POS is a historical building, then no teardown, and probably have to sink more money into it to restore said POS.
for some unexplained reason, everytime I read the word SIMDAG, my mind registers it as “Dirtbag”. Anyone else?
My subconscious connection is with the SI-nking of the airplane that carried DAG Hammarskjold (UN secy-genl) over Africa, resulting in his death. In this interpretation M might be Maumau.
That’s what I thought too.
It sounds like a gangsta rapper to me.
Sim Dag, Snoop Dogg, Fag Hag, you know, something along those lines.
“Hillsborough County has enacted a hiring freeze and moratorium on new building construction in anticipation of budget cuts later this year. County Administrator Pat Bean also told employees to expect layoffs.”
Well, that makes good business sense!
At least there’s no recession.
counties have spent like drunken pigs- if they’re not carrying a gun or a fire hook you probably don’t need them
CHOP HARD
“if they’re not carrying a gun or a fire hook you probably don’t need them.”
Absolutely! We watch them spend 10’s of millions on basic buildings that should cost next to nothing. Why do we need a 10,000 square foot atrium in a tax collector’s office?
They’ll blow money like there’s no tomorrow yet a starting teacher doesn’t even make $34,000 in Palm Beach County.
“counties have spent like drunken pigs- if they’re not carrying a gun or a fire hook you probably don’t need them CHOP HARD”
Amen to that. Like Andy, I hate it when elected officials blow obscene amounts of money on pretty buildings. All I care about when I go to pay yet another tax to somebody is that the place is clean and air-conditioned and that the seats aren’t ratty, if I have to wait. I wish our local government would require all new government buildings to be pre-fab, Butler-building type structures, roughly like school pods. For that matter, I wish there were a way for voters to have a line-item-veto opportunity once in a while, as a means of getting rid of entire sections or departments. Try something like that and watch the pols sue to prevent it — a lawsuit by elected officials to prevent enactment of the will of the people.
“a lawsuit by elected officials to prevent enactment of the will of the people.”
Kinda like the shamnesty bill.
The reality is that the REALLY big money in government already goes to the guys with the guns and the fire hooks. Check out the pensions of those guys. In most Calif. cities, public safety personnel have retirement plans that are “3 at 50.” That means 3% times # of years of service times highest annual salary (including awesome amounts of rigged overtime) at age 50. IOW, a cop or fire guy who’s worked for 25 years can retire at age 50 making 75% of what he made in his highest earning year. Plus lifetime medical benefits.
That’s where your tax dollars are going. The buildings are nothing compared to the pension obligation.
I know now that they must set the pension money aside at least in FL. The wife’s check spells out exactly how much is being set aside for the Florida retirement program.
“Hillsborough government is one of the county’s largest employers, with a workforce of about 6,000 people.”
Just before the $h|+ hit the fan in Argentina at the end of 2001, public programs were bounteous, the Argentine trade deficit was huge, job opportunities for well-educated young people were few, big money was entirely dependent on political connections, does any of this sound familiar ?
Which is why the whole effing economy is run on fumes called debt. At some point the sheeple will have no more credit available. At that point it is end game for USA since 70% of the economy is consumer-driven and we all know how the consumer pays in full with cash or check or in the case of credit card, pays it full every month (unless floating debt at cheaper rate than CDs, etc., but will still pay it off after teaser rate)!
Bottom line is all the signals (Japan RE, Argentina debacle, the Great Depression) point to a coming major economic catastrophe in this country. At some point, we will not be able to keep propping up bubbles and there will be no middle class left to transfer wealth from.
We all know how this will play out. The only question remains is when will the sh!t hit the fan BIGTIME!?
Sad to say, but as a soon to be member of the 40 year old club (June 19th), I think it is ssafe to say it will be in my lifetime, provided I live to at least the avg. male age of 72ish. I just don’t think we can do business as usual for the next 30 years. At some point the rubber band is going to snap and snap back hard.
Given that you made it to 40, life expectancy life for males is about 37 years.
OK, no more crown and coke.
I don’t agree that well-educated people in the United States have few job opportunities. I will agree that the opportunities don’t exist everywhere and that the definition of well-educated is open to interpretation.
I know that my employer is having a hard time filling a few positions, but refuses to hire someone that doesn’t meet their qualifications. They have no problem getting applicants and shouldn’t have any problem getting qualified (well-educated?) applicants if they existed. From my experience, I would say it’s about the most ideal work environment. Highly competitive salary and benefits, nobody is asked/expected/pressured to work more than 40 hours/week, 5 weeks paid time off a year, flexible scheduling, etc.
As someone who was laid off two years ago, I can tell you this is not true. Perhaps this is just in the telco industry, but the majority of jobs available are contracting. Nobody wants to pay for time off and benefits.
Agreed. That is another reason why so many jobs are offshored. No one wants to pay you for not being there. On top of that if that have to make up for absence either they pay someone else OT or pay for some temp. Either way it is a double pay on the co.
Sure, are there exceptions? Yes, but look at the numbers.
Perhaps you two are right. I see plenty of contractors out here as well. But it seems like there are plenty of companies [around here] that still desire the long-term stability of actual employees and see them as investments in future revenue.
Employers are bing very picky about who they hire. They want someone who fits the job like a glove. No one is willing to hire someone who is smart but might need some training and/or time to come up to speed. This is especially true in tech. In the past, for instance, most tech firms would hire people who had proven problem solving skills. That is no longer the case. Now its: are you familiar with the tools that we use? (Ruby, Cold Fusion, .NET, etc.).
“‘With the loss in home values, credit tightening up and people saving instead of spending, there will be a substantial loss of jobs,’ McCabe said. ‘We’re definitely heading into a recession with all this pressure.’”
Thanks Jack! Even though you’ve been on the bubble bandwagon longer than most, you were still telling people to buy at the end of ‘05. This could have been avoided by not letting it get so crazy in the first place! Telling people at the end of 2005 that single family homes would hold their own was simply irresponsible.
The Tampa Tribune this morning had housing bubble stories everywhere. Get ready for the industry counterattack. Sometimes I think the only people being hired by Pulte, etc. are public relations flacks.
And lawyers!
Tampa’s all in a tizzy over this. Sheesh, I’ve said before, Tampa should just stop trying to wannabe Miami, New York or LA and just be more of what it is, a sleepy, middlebrow port city on Tampa Bay with a few charming neighborhoods (Incredulous would disagree with me on the charming part, but the potential is there). I’m glad the bubble busted before Tampa could really screw it up.
Tampa needs to concentrate on cleaning up the bay and other pollution. Burns my patootie that I live in a waterfront community and can’t just sort of casually saunter down to the beach and take a dip.
Yep, I’m in one of those “Rage Against the Machine” moods today. Since when did the quality of life take second place to “big business”? Peopl should be able to swim in a Tampa Bay free of pollutants. But, OH NOOOOO, BUSINESS has a right to eff up everything in sight, right? If I conducted my personal life the way corporations do, I’d have been behind bars or in an electric chair long ago.
Hi Palmetto,
I remember when Tampa Bay (not Hillsborough Bay) was so clear, you could watch the crabs running along the bottom (so you never had to accidentally step on one), but Tampa and Hillsborough County couldn’t care less about protecting Nature; they’d allow every square inch to be plowed under to benefit the few at the expense of the many, if they could. It has always been this way here.
Be sure to get Christopher Hitchens’ new book “God Is Not Great.” It’s horrifying, but hilarious at the same time, and says much about the way humans think about things. It also talks about booms and busts in the evolutionary sequence.
This is what you get when you have a splintered population. 1/2 of the city is poor folk who consider Disney world (the big rat) a culturally diverse trip and a huge deal, and the other 1/2 masquarade around like a bunch of mini Warren Buffets trying to act like they are kings of the world in their Navigators, gucci handbags, DKNY sunglasses, dogs, doing all the trendy things in South Tampa on a paralegal’s salary. (Yes, i know some pople just like this).
This is one of the most close-minded places I’ve ever visited in my life. If I didn’t like the weather and the water I’d leave in a second. But I love it here, yuppies or not. At least it’s not quite ‘Miami-ish’ yet, and this bubble bursting will cure what tinges it has so far.
Tampa has been pushing that stupid river walk project since the 1970s. Who wants to walk along the filthy Hillsborough River downtown in broiling heat and humidity with absolutely nothing to look at in any direction? Except for the Section-8 projects across the river. There are no real parks there; what Tampa calls parks, other cities call blighted vacant lots. The only thing that could help downtown Tampa is if somebody leveled all of it and started over. What a dump.
Everybody got mad at me when I said Trump Tower would never get built, and that downtown Tampa would never be anything other than what it already is: an ugly, dirty, unplanned, user-unfriendly, glorified slum. I can’t wait to hear about all the other pie-in-the-sky projects being canceled. People here actually think Tampa is comparable to Paris, London, and the like, because they’ve never been to Paris, London, and the like. And because they’re extremely delusional.
“And because they’re extremely delusional.”
You get the same thing on the east side of the state. Everyone in West Palm Beach (more along the lines of unincorporated area) and Ft. Lauderdale think they’re in a world of class. I beg to differ.
The city of West Palm Beach proper is a mess of 1/2 build and 3/4 vacant condos. City Place charges to park now and Clematis St is dead.
Don’t get me Started on Lauderdale PLEASE!
The problem with all these “urban renewal” projects is that they all targeted (at the same time) the ultra rich resident/traveler. Perhaps ONE CityPlace/Downtown at the Gardens/Town Center/Los Olas would have done fine in the S. FL area (not counting Miami, which has always had Lincon Rd and many other high end shopping districts). However, the put one of these SUPER high end shopping districts every 10 miles (no, I am not kidding) down the entire coast of FL from Palm Beach Gardens to Miami. They have totally canablized each other’s business; there are simply not that many people in the area who are dying to spend 5K on a Vertui cell phone! And if you are truly THAT rich, you will shop at Worth Ave (or again, in Miami).
All of these projects targeted the same demographic (25-45 year old people with incomes of 100K+). This demographic is incredibly small in S. FL (although, from the looks of things, you would not think so) and there is WAY (I mean like 5X) too much competition for the same dollars!
It was totally nuts to think that we “needed” a very high end shopping area ever 10 miles! The only way it made sense was by looking at the housing projects surronding the areas (which were filled with condos from 500K-5M) and infering that these people were going to have money and the inclination to spend.
This whole house of cards is a big circular argument. If you build it, they will come!
BTW, all these shopping areas are in dire straits. CityPlace, to the best of my knowledge, is losing their ancor (Macys). And foot traffic is nowhere near the promised levels in any of these locations (suprise, suprise, 2000 condos don’t have 2000 residents when you sell 80% of them to speculators!).
” CityPlace, to the best of my knowledge, is losing their ancor (Macys)”
I didn’t hear that Mike. That would spell trouble. You can’t survive on restaurants alone.
there are simply not that many people in the area who are dying to spend 5K on a Vertui cell phone!
That’s too funny! Up here, Nokia has a flagship store with all their phones for sale (unlocked GSM phones, BTW). In the back, they have a separate display for their Vertu lineup. They sell them as nothing more than a fancier Nokia, which is all they really are. Like Honda’s Acura line. Or Toyota’s Lexus. Anyway, every time I’ve been in the store there’s always a bunch of people back there buying them up. It’s just plain crazy.
I agree with you on the current condition of the Hillsborough River and, with the exception of a few parts of the University of Tampa campus, on the uninspiring sights to be seen from it. However, I’m not opposed per se to the idea of creating a “riverwalk,” because any form of urban renewal has got to start somewhere. Cleveland cleaned up the Cuyahoga River, for example.
What I am opposed to is the harebrained idea that “arts” culture and this town ever will coexist. We can’t even support a decent jazz club, for Christ’s sake.
Remember, “art” in Tampa has a lot to do with the application of pigments to velvet, so by Tampa’s definition, this place is the art capital of the Free World.
Oh, oh, oh, laughing so hard, choking, can’t breathe, that is TOO funny (banging on the desk, pounding chest).
Yet absolutely true. You weren’t living here when Manuel Verez (sp?) of Valencia Gardens came on television every Friday night (during “Shock Theater”), to say “Salute and happy days one thousand and ten” or whatever (every week the number increased by one). This was on channel 13, and Andy Hardy introduced him and the Valencia Gardens restaurant. “That’s the place,” he always said, “where they have the greatest collection of art in the world.” The collection of art in question was a couple of taudry mosaics showing peasants in Italy harvesting crops or something. Everyone in Tampa–with only two known exceptions (I was one) accepted as gospel that this was, in fact, the greatest collection of art in the world.
Culture in Tampa Bay is not-existent. It’s a very homogenous place, as I’m reminded every fall, when the leaves just turn brown and the weather cools a bit, and ruins all the fun of the outdoor activities.
They have culture, redneck culture perhaps, but they have culture.
what they have in spades is lightning!
I moved oh-so-briefly to Sanford, Florida and lived in the Orlando area. That cured me of any complaints I had about Tampa.
Palmy, thats what you get for living in one of the dumpier outlying areas of Orlando. You should have moved to a more high-brow location like Oviedo… or Christmas. They race old school buses in Christmas. Now THATS culture.
You guys are hilarious today. Thanks, I needed that. Always helps with the anger management.
“Jack McCabe, CEO of a real estate consulting firm in Deerfield Beach, said the consolidation of DiVosta’s South Florida division doesn’t bode well for the economy.”
“‘We’re just about to see the domino effects of this,’ McCabe said. ‘What happens next year is you’ll see Circuit City, Best Buy, Brandsmart, all those big box retailers are going to feel that slowdown which was substantially driven by consumer spending and the housing market.’”
“‘With the loss in home values, credit tightening up and people saving instead of spending, there will be a substantial loss of jobs,’ McCabe said. ‘We’re definitely heading into a recession with all this pressure.’”
Lots of people in deep financial mess. I blame greedy REIC and wall street bums. partial blame to some of these dopes that would not listen when you brought up over priced houses be careful with atm borrowing. Lots of debt slaves in trouble.
“wall street bums.”
I have such venom in my heart today for these creeps. One day, someone who profited off this misery is going to be in position where they need my assistance for some reason. Could be anything, even something small like needing the use of a cell phone. I’ll be whistling Burt Bachrach’s tune “Walk On By”.
Oh, and that hedge fund guy I posted about a while back…the one who is a miserable falling down drunk bastid. Hope he stays that way, because the sooner his liver rots, the better the planet will be.
I posted this in the bucket-o-bits but thought it would fit here just as well…
Down here in Port Charlotte during the run up bare lots were selling for 35-60k all the time. I have noticed that in the last month or so a few lots have had sale pending on the RE sites. The current price…9k… Ouch,that is gonna leave a mark. Before the big runup lots were 5-7k.
I had a appraiser tell me a few weeks ago Adams Homes unloaded a package of 400 lots for a average of 20k per lot in the Deep Creek development. He mentioned some of the water lots in this package were selling for 250k at the high point.
Oh you’ll love this. Around the corner from my place are 2 houses that look done from the outside. Peer in the windows and NOTHING is done inside. No electric/plumbing/drywall/flooring/freakin nothin. According to the neighbors the builder ran out of cash to finish at this time. Nice…….
Chris
Hey, Cobradriver, I meant to thank you over in the Bits Bucket, I appreciate the reporting. I sold a vacant lot in South Hillsborough for $11,000.00 just at the start of the run-up. At the peak, the new owners were asking $75,000 unimproved (what the avergage house in the same subdivision would have gone for prior to bubble). They probably could have gotten close to that if they hadn’t waiting until the peak to put it up for sale. They could probably unload it for $20,000 now if they really don’t want it. Otherwise, if they sit on it, it will be below what they paid for it shortly.
and meanwhile they are paying property tax based on 75k valuation. you left that out…
No, their taxes are based on what they paid for it, plus whatever increases the county has added on, not for what they want for it (unless the county has decided to take their fantasy seriously). If it’s their only property, they could claim homestead exemption; otherwise it’s a huge gamble.
No, they have a home, and the lot is vacant land, so no homestead exemption. They were nice folks, they didn’t originally buy the lot to flip, so I hope they’re not taking it on the chin in taxes.
FL land hasn’t taken a hit since the 20’s
in 90-95 Venice etc kept creeping up
it’s different this time
Cobradriver, ouch indeed. I do hold one note on an RV-park lot in SW Fla. The borrower needled me almost to death in 2Q04 to get me to make the loan. I am owed about $40K on a piece of dirt which, at the time, seemed comparable to others offered at $75K. Hmm, maybe this is the loan I should lie awake worrying about. So far no trouble, the borrower is always prompt with payments, maybe unaware of submersion! Thanks for heads-up
az lender…
If you need some info on the place and its in sw fl let me know. Just shoot me a email at cobra427driverthelittlecirclethingynetscapethenthedotcom.
Chris
house in my hood 22151 s of central soviet DC is abandoned- never seen that
they overpaid by 60k$ in 06 and now poof
Down here in Port Charlotte during the run up bare lots were selling for 35-60k all the time. I have noticed that in the last month or so a few lots have had sale pending on the RE sites. The current price…9k… Ouch,that is gonna leave a mark. Before the big runup lots were 5-7k.
The Pain. a complete 180 soon.
got 20% down?
“Pulte Homes announced Wednesday that it was cutting nearly 2,000 jobs nationally in a massive restructuring aimed at saving $200 million annually. The company said that the slowdown has left it with overhead that far outstrips demand for its houses.”
“The cuts mean that as many as 25 percent of the 55 employees in Pulte’s Sarasota-Manatee division will lose their jobs. “
I am betting that these cuts are only for direct employees of Pulte Homes. It does not count all the sub-contractors and day laborers who won’t be hired to do most of the actual work.
“‘This is tough, but I don’t want people to think we don’t have confidence in this market,’ said Steve Kempton, Sarasota division president. ‘We’re just trying to right-size our business to position ourselves for long-term success in the Sarasota-Manatee market.’”
Looks like 13 people just got “right-sized” out of a job.
“Looks like 13 people just got “right-sized” out of a job.”
And those 13 people don’t have another market to pack up their family and move to because the boom’s gone bust nation wide.
The people who’ve been in the trades for 25 years in the same city are the ones who will still have work. It’s the job hoppers that uproot their families every 2 years that are being right-sized.
I had a appraiser tell me a few weeks ago Adams Homes unloaded a package of 400 lots for a average of 20k per lot in the Deep Creek development. He mentioned some of the water lots in this package were selling for 250k at the high point.
“omg”!!!!!!!!!!!!!!!
have been looking for data on these builder lots-wow keep em comming
We have empty houses all over the place, 4 on our street alone, I am also seeing a lot of commercial vacancies popping up.
Yes, commercial vacancies, but they are still building Italian Bourock style strip malls full of tanning salons, coffee houses and a COUNTRYWIDE mortgage offices in my area of eastern suburbs of Minnesota (Woodbury). It is amazing, strip malls are semi-abandoned a mile or two away and multi-gazillion dollar frue-frue craptacular stuff is going up and not a hardware store or a “REAL GOODS” store in the lot.
End stage bubble capitalism at its finest…..guess someone has not told them growth is flat. hundreds of for sale signs in Woodbury, Oakdale, Lake Elmo also.
The Kmarts, Walmarts and Targets are empty on Saturdays.
Stock market is going great guns, though.
This is all going to end very badly.
“The Kmarts, Walmarts and Targets are empty on Saturdays.”
Speaking of which, went to a decent chain restaurant last Saturday night at 7:00pm in Colorado. It’s been a while since we’d been there, but as of a year ago the wait would have been at least 1/2 hour at that time, with people spilling out the door. Weather was nice, everything was perfect, place was only about 3/4 full. New menu was much simpler. Prices were higher. I doubt I’ll ever be back, the new prices put it in a range where if I want to spend that much I can get food that I like a lot more elsewhere…unless those places have also gone up significantly in the last month as well.
From what I’ve seen, most have gone up, too. And the independent restaurants are feeling the pinch worse than the chains. My wife works at one, and products costs are up across the board. Got gasoline?
Just getting fresh seafood to an independent restaurant is costing a fortune, so says the better half…..
My observation as well. Never a wait these days. Chili’s, Black Eyed Pea, Mimi’s, Red Robin, Cracker Barrel, Old Chicago, Applebee’s, Red Robin, On the Border, Johnny Carino’s, etc., same story every where!
Prices are about 40%+ higher than just a few years ago (an entree that used to be $10 no goes for $14), plus here in Loveland new chain restaurants keep popping up, even though the market is clearly maxed out.
Commercial,in Florida,no problem here,nothing to see,move along now…
Look at the amout of commercial listings vs other states…ooops.
http://www.remax.com/commercial/property_search/index.aspx
I think we all know where the liquidity moved to !!!!!
Chris
In northern St. Petersburg, I see commercial “for lease” signs everywhere.
kEEP the bubble stories COMING. It is redemption time. Years of watching waiting for the lunacy to end.
The pain index is hitting record levels for many debt slaves
i am so jealous. Cannot wait for the first downturns to be widely seen in the pacific nw.
(I can’t wait to hear about all the other pie-in-the-sky projects being canceled.)
What about the projects already too far along to stop?
Last weekend I spoke with a relative of a relative about New York City’s tallest residential tower, now going up in Lower Manhattan next to the Brooklyn Bridge (I doubt pictures of people fleeing 9/11 over the bridge will be posted in the sales office). He is working on the building, designed by Gehry, which means there are no corners in the facade, which means the costs were high to start with and are now soaring. Meanwhile, the builder has already decided to do a rental building rather than condos, though that could change if the market does.
The building rushed to get the foundation in, presumably to qualify for 421a tax breaks which are expiring this year. Lots of other builders are rushing to do the same.
In the end, all the construction will be good for the city, good for the construction workers, and good for the eventual tenants/buyers. Not sure about the developer and lenders, however. I think we may end up with an unintentional private sector affordable housing program in a couple of years.
This same developer pulled the plug on a massive Arverne-by-The -Sea residential development at the end of the 1980s bubble, when the city let him out of an agreement to build. Too late in this case.
BTW, this building is well along. But I’ll bet others will rush to start and get vested before 421a expires. The last one to finish is going to have big problems.
Oh yeah… Casey claims to be done. I’ll believe that when I see it.
Yay. Maybe we don’t have to see him on TV any more either.
“credit tightening up and people saving instead of spending, there will be a substantial loss of jobs”
Bullcrap! People are not saving instead of spending, they are trying to find a way to pay off CC’s, cars, etc that they already purchased on the ‘How much’a month it a’gonn’a cost me’ plan. Remember on some of those deals like at HomeDepot there was no payment until years end. Love the implosion of the ‘gonn’a cost me plan (GCMP)’.
“Remember on some of those deals like at HomeDepot there was no payment until years end. “
That’s nothing, a lot of furniture stores have long been advertising that you don’t have to make payment until a couple of years. Today they are saying “No payments until 2010”
So people bought their home with an OptionARM loan, they then refied to get a home equity loan to buy a new car, and they bought their furniture with a no payment for a couple of years financing. So all these loans are coming due at the same time with their variable rate mortgage going up and their delayed payment retail loans coming in as well. And with their house dropping in value they can’t bail out by selling.
That reminds me of a Lowes commercial where the male part of a couple goes nuts buying worthless junk because they don’t have to pay for a year. Even my 12 year old noticed that the husband/boyfriend was loading up on cr@p, and remarked that they will still have to pay for it.
I explained to him how the 1 years same as cash trap works: you go nuts and buy a ton of junk, then the year expires and you can’t pay it off. Boom: now you do owe the interest on the year that elapsed!
“Hillsborough County has enacted a hiring freeze and moratorium on new building construction in anticipation of budget cuts later this year.”
Yep! Time to cut the payroll. Just axe the positions and contract out the services to the lowest bidders (ie. minimun wage). You’ll also save pay retirement bene’s, workers comp, etc. Best of all, it can be done without a lot of adversity because everyone will understand that the dollars just aren’t there.
This is the big one, folks. No one can hide the data now. The
whole economy is collapsing, and we’re in for it big time. Just
don’t forget to thank your politicians — after all, it was *their*
pockets that received a substantial portion of the builder’s
money.
All the green numbers on this page show just how wrong you are. As long as the stock market keeps going up, the U.S. economy will do just fine.
http://www.marketwatch.com/tools/marketsummary/
MACBETH: “I pull in resolution, and begin
To doubt the equivocation of the fiend
That lies like truth: ‘Fear not, till Birnam wood
Do come to Dunsinane:’ and now a wood
Comes toward Dunsinane.”
own a lot of properties, do we?
too bad you didn’t see it coming. i did. so did a whole lot
of other folks on this blog.
In 1929 the economy was in big trouble but the Dow continued to advance into September 3rd. During inflationary times the market does lead the economy. It is usually the result of higher interest rates, which depress the stock market, and eventually affects housing and industry.
In a potential deflationary scenario the stock market has followed the economy. The economy’s very weakness initially aids the market as a lack of business opportunities encourages buy backs or stock liiting supply. Unfortunately the low level of business opportunity eventually takes out the market. I think that is our present situation.
You are correct that a break in the market will put the nail in. I just think as an indicator it will be way late and therefore potentially very costly. It is better to not be in the markets in my opinion. This is a time to keep what you have not make the last 10% and take too much risk.
“‘I asked what kind of property, and they said ‘a lot of scattered homesites with almost-finished homes, about three or four subdivisions, about 80 lots.’”
That description could just as well apply to what I see on the ground in San Diego — lots of subdivisions with almost-finished or just-finished homes priced to sit on the market forever, with a shortage of millionaire buyers to snap them up.
I’m in Glenwood Springs, Colorado (a short drive to Aspen) and I can’t tell you how amazed I am at the number of expensive houses that are on the market. Very impressionistic statement, I know, but I lived here for 10 years so I’m a bit familiar with how it ticks, and it’s not sustainable. A friend told me that Aspen has its own economy (and by inference, Glenwood) because all the folks who own the companies that are now in china are immune to the J6P economy. I call bs on that, but the real estate here speaks to only to the millionaire anymore. Hard to believe I bought a house here in 85 for 100k that now sells for 500k. That was the year of Black Monday when the oil shale industry bit the dust. It’s gonna be deja vu all over again soon, even here. OT - gas here is now 3.52 for regular.