A Sense Of Uncertainty In California
The Times Herald reports from California. “The number of home foreclosures in Solano County is rising along with those of other Bay Area counties, even as local median home prices continue to fall, industry experts report. In Solano County, the median price of a home sold was $428,000 last month, a 7 percent drop from $460,000 in April, 2006, according to a recent California Association of Realtors report.”
“Within the county, Dixon saw the sharpest decline, 16.3 percent, while Vallejo’s median sold home price dipped just over 4 percent.”
“Solano Association of Realtors president Jeff Dennis acknowledged that in the past several years, Solano County had more than its share of home buyers who secured subprime mortgages they couldn’t really afford, with no down payment.”
“Often, as prices decline, these folks find they owe more on their home than it’s worth, and as their low teaser interest rates adjust up, many are finding it less painful to just walk away.”
“It’s a problem shared by many Bay Area counties, particularly Contra Costa and Alameda, Dennis said.”
“Benicia mortgage broker Mitchell Chernok, said it’s not unreasonable to expect ‘a wave of foreclosures’ to sweep Solano County for the next several months.”
“Chernok and Dennis agree that after the dust settles, there may be an upside. ‘The light at the end of the tunnel will be a lot more affordable housing in the county,’ Chernok said.”
“‘We can’t continue living like it’s 2004,’ during the red hot Bay Area real estate market, Dennis said.”
The San Francisco Chronicle. “Amid slumping home sales and pessimistic forecasts, a subdued group of builders gathered at Moscone Center this week for the Pacific Coast Builders Conference.”
“‘There are fewer people here and there’s not the upbeat intensity there was a couple of years ago,’ said show-goer Frank Prach, owner of an architecture, building and design firm in Auburn (Placer County). ‘There is a sense of uncertainty.’”
“Robert Becker, president of Wintergreen Enterprises Inc. in Tiburon, said sales have stalled at a high-end development his company has in El Dorado Hills near Sacramento. From 2003 through 2005, it sold 55 lots ranging from $400,000 to $700,000 for custom, $2 million homes. Last year it sold two lots.”
“‘This year, there is nothing,’ he said. ‘Nobody comes through the subdivision. I think we’re in for a down year and we’re in a bad situation for next year.’”
The Mercury News. “Consumers are leery of buying new homes now, agreed Southern California builder Brian Catalde at another session Thursday.”
“Catalde, who is president this year of the National Association of Home Builders, said that in 2006 his customers visited a new-home community’s sales office an average of twice before they bought. But now people make eight to 12 visits without buying.”
“When asked why, nearly three-quarters of them said they feared they’d buy a home and then the builder would lower prices again, effectively wiping out new buyers’ home equity.”
“‘People don’t pull the trigger because they’re afraid they’re going to lose their down payment, and I don’t blame them,’ Catalde said. ‘I’d be concerned too.’”
“In a sign of the leaner times for the home building industry, attendance at this year’s PCBC show fell to about 28,000 from about 31,000 last year. The show’s theme of ‘the new basics’ was highlighted with slogans adorning the entrances to the trade show floor that read ‘rethink,’ ‘reconnect’ and ‘refocus.’”
The Sacramento Bee. “Like all businesses, real estate is one grounded in optimism. It likes to minimize doubt and look for the silver lining. So it’s not surprising that when its industry prophets make forecasts, they lean toward high. Nor does it come as a surprise when they revise downward.”
“On Thursday, the California Building Industry Association did the dance. It now projects 20,000 fewer permits for new houses and condos in 2007 than it predicted in January.”
“Alan Nevin, CBIA chief economist, is downsizing expectations for the Sacramento area, too. In January he predicted 13,500 to 16,500 residential building permits for El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties. His new guess is 10,500 to 12,800.”
“In early 2006 Nevin said Sacramento was likely to repeat the frenetic home-building activity of 2005. That was revised, too.”
The Orange County Register. “Mid-May home-selling stats from DataQuick show buyers seriously balking. Sales activity was down a sharp 35% vs. a year ago for the 22 business days ended May 15. If that holds, last month will have been the slowest selling May in DataQuick’s 20-year history of O.C. real estate.”
The Desert Sun. “Coachella Valley leaders gathered Thursday to address a looming crisis. Only 10 percent of valley residents are able to afford the $400,000 median-priced home and the nation’s eighth-worst house-price-to-household-income ratio.”
“The valley could end up like Orange County, said economist John Husing, where expensive homes and even rents force much of the workforce to drive long distances in bumper-to-bumper traffic.”
“A simple trip to Redlands will become a mess, Husing told the crowd. ‘You need to have affordable housing here or you’re condemning people to an abominable lifestyle,’ Husing said.”
The Gilroy Dispatch. “The number of default notices in Gilroy nearly tripled in early 2007 compared to early 2006, according to a DataQuick. The trend is driven by sagging home values, which have prevented owners from simply reselling their homes when overdue payments stack up.”
“‘Honestly, I don’t think we’ve even begun to chip away at the iceberg in South County,’ said Nuemi Guzman, a predatory lending intake worker with the Fair Housing Law Project based in San Jose.”
“‘The lender often takes a hit on this,’ added Martin Eichner, director of dispute resolution programs for a tenants’ rights organization with an office in Gilroy. ‘It’s the guys in the middle, the brokers, who make the money.’”
“A bill that would have created a pool of money to help subprime mortgage borrowers facing foreclosures to refinance their loans died in the state Assembly Appropriations committee Thursday.”
“The measure, AB1538, would have allowed some of those homeowners to refinance their loans with affordable interest rates by using a new fund created by tapping into the housing bond that voters approved in November, floating bonds in the future and asking banks that have large numbers of subprime customers who face foreclosure to pitch in.”
“Chernok and Dennis agree that after the dust settles, there may be an upside. ‘The light at the end of the tunnel will be a lot more affordable housing in the county,’ Chernok said.”
The reason the light at the end of the tunnel is not quite visible just yet is the giant settling dust cloud is blocking out all of the sun’s light. But I think I can hear the sounds of FBs gasping for breath.
You can’t see the light at the end of the tunnel when your eyes are closed and you’re just trying to hold on for dear life to the locomotive that is plunging down the side of the mountain.
In So Cal school enrollment in way down (like FL) people with families are givin up and movin out. Million Dollar Median will do that.
Buncha old people and hispanics down here. I see very few ‘young families’.
I made this same comment some time ago on Lansner’s blog.
It was thoroughly lambasted as laughable.
Still, I call ‘em like I see ‘em.
Chuck Ponzi
“…be a lot more affordable housing in the county” In half built subs with abandoned homes with knee-high weeds, empty lots, vandalism, etc.
I’ve seen alot of empty, new build homes around Boise with weeds growing up in the yards, empty lots collecting junk and more weeds. Some of these “investor” homes and foreclosures are becoming eyesores. Are any of you seeing the same problems?
The empty homes around San Diego seem very well-kept thus far.
The city I live in gives citations and then I think they come and cut the yard if it never gets done.
Add citations to the list of carrying costs for holding on to vacant property.
You know GS, although many FBs are losing their shirts it sure seems like there are other specuvestors that have such a vast amount of wealth stockpiled that they seem to be able to hold out just fine (or so it seems).
Do you know of any information sources that show the wealth drain coming from retirement funds/brokerage accounts/savings that is being diverted to hold on to real estate holdings by the specuvestors? I mean, some of these people are NOT coming down at all pricewise, and I am thinking that they must have a lot of $$$ to be able to do this.
Any insights would be appreciated!
~Misstrial
I hope some of them can since I hope to spend 2 years renting for $1300 a month a house that could appraise for $270K today. I don’t want to have too many of those foreclosed out from under me while I wait for prices to crash!
“and I am thinking that they must have a lot of $$$ to be able to do this.”
You mean DID have a lot of cash. The ones that have any left are watching it go down the drain fast. When you see the run-ups in prices that we’ve seen in the last 5 years, it takes a while to soak up the cash gains. But it’s happening. Let them scream uncle first - it takes a while to bleed this pig.
Alternatively, there are a good number of people out there who bought before 2000 and didn’t HELOC or REFI to the hilt, they can have their houses sit unsold while hoping all they want for fantasy prices without much pain.
A lot of the refi money aparently went into the stock market. That will start to reverse and leave a mark on the stocks as well.
Not to mention lots of liability issues with companies involved in real estate.
Everyone is going to get burned in this unless you have HUGE amounts of capital to buffer yourself.
Thanks to all for your perceptive replies
I read the other day about a FL couple who are going to go through 160k in the next 6 mos to cover the mortgages on 3 houses (2 investments, 1 primary res - loan for 400k on the primary to buy #’s 2 & 3 - oops!). According to this article, they are draining their retirement funds to keep afloat. After that, they will be cashless.
James - I think you are right about the stock market - this accounts for the irrational run-up we are seeing.
Thanks again to all….
~Misstrial
San Diego city council had hearings and begun sending city crews out to mow the abscent home owners lawns. They did about a dozen so far, then they bill the owners. They were all out of state owners.
This is beautiful — stick out-of-town owners with the tab for maintaining the spec homes they are not around to care for. If the city council keeps making moves like this, they may make great strides towards restoring affordable housing for families who live and work in San Diego. Too bad for the out-of-town specuvestors who get squeezed out of their alligators.
What I’m seeing is partially-built subs (like the one my kid bought into last summer in Marysville; his wife just found out that the builder is selling their same model for 100k less this summer, btw. We tried to stop them, God knows we tried…).
I did see a very sad little house in a newer area of Elk Grove last week, with the “bank owned” sign and a tree that was falling over sideways and pulling it’s stakes out.
How much was the original list price? Those sneaky builders, can’t trust many people in RE. The money stakes are just too high to trust someone.
Ahhhh, the stupidity of youth. I’m sure you were just another moron to them. Now, they probably say things like, “we should have listened.” The only lessons that teach are painful lessons. I can’t imagine being a young couple and seeing 100k of paper wealth evaporate. I just hope they learn and that you don’t end up supporting them.
What wealth? Did they ever have any equity in the place?
We tried to stop them, God knows we tried…).
Make sure to remind them at Christmas dinner, let us know what happens.
Ok that is funny but cruel. Cmyst I think also has some children who did listen to mom and stayed out the market and one I think is a housing bear. The whole family can say I told you so at Xmas >; )
“The whole family can say I told you so at Xmas….”
Will this even be necessary by December 07’?
Dad: pass the taters sport…..
Son: yes Pa……
Sounds like “uncertaintiy” is turning to fear.
Panic soon to follow. Well, this might break down sooner than I thought.
I agree, James. It’s like a stone rolling downhill. Gathers speed as it goes. Isn’t that next wave of resets right around the corner? Just MO, but I think that’s the main event.
Really ramps up around Christmas of all times. I get the sense that people are slowing consumption already and going in to their bunkers.
Its what I am doing.
Speaking of slowing consumption, just think of what a missed $ 100 restaurant meal (dining experience?) or a missed bar tab of $ 100 or so can do for savings, and when these types of expenditures are omitted and added to savings towards either a down payment or accelerated mortgage repayment, when compounded, they can go a long way towards financial independence. I have cut way back on discretionery spending and am starting to look at a lot of this stuff as conspicous consumption which i don’t have much over all respect for in any event.
“We have a large number of subprime loans (in Vallejo) because it’s more affordable here, so buyers gravitated here who wouldn’t have been able to qualify without the availability of the subprime loans,” Dennis said.
Vallejo is a Ghetto beginning to become a Barrio. I repo’d lots of cars with bald space-saver tires from the many Section-8 complexes there. You might survive in Vallejo, but you’ll never live there.
All this refers to areas outside SV, where prices show no sign of dropping by any meaningful amount.
“Mid-May home-selling stats from DataQuick show buyers seriously balking. Sales activity was down a sharp 35% vs. a year ago for the 22 business days ended May 15. If that holds, last month will have been the slowest selling May in DataQuick’s 20-year history of O.C. real estate.”
Would Gary Watts care to step forward and give us an updated price forecast for The OC?
Gary is down at Susie’s Tavern and Massage Parlour. He’s 95% “in the bag”.
I believe there is enough cash here that people are going to try and hold on to these houses as long as possible. This isn’t a poor area, however just like tide with a bucket…eventually they are going to have to move on these. The property tax alone is killer.
This isn’t a poor area
Maybe not in absolute income terms, but it’s certainly a house-poor area!
Records have been kept since 1987 and this is the worst may the OC has had. The OC was a much smaller place in 1987 now. Nothing is selling
“Mid-May home-selling stats from DataQuick show buyers seriously balking. Sales activity was down a sharp 35% vs. a year ago for the 22 business days ended May 15. If that holds, last month will have been the slowest selling May in DataQuick’s 20-year history of O.C. real estate.”
Sounds about right looking at Things from The ground-level. Seeing lots of for-sale signs everywhere on the WEEKDAYS lately. Especially in the lower-end hoods the owners seem desperate to unload That 800-1200 SQ ft, 2/1-3/2 60-80 yr old POS at last years peak prices of $400-500,000. Lots of owners of these POS’s in the LA crapburgs did quick cheap cosmetic fixes/slapped=on additions and expect the ignoramous FB’ers to come out of the woodwork.
Good luck! there are no more qualified buyers(unqualified to begin with) left to buy your POS’s in the LA Barrios: the Subprime market just went KAPUT!
Foreclosures are about explode in the LA ghettos: they are indeed exploding now. E.G Compton is at 300 foreclosures and the game is just barely begun.
To quote Nelson from the Simpsons: “Haaaa-Haaaaaaaaaa”
“Often, as prices decline, these folks find they owe more on their home than it’s worth, and as their low teaser interest rates adjust up, many are finding it less painful to just walk away.”
“‘People don’t pull the trigger because they’re afraid they’re going to lose their down payment, and I don’t blame them,’ Catalde said. ‘I’d be concerned too.’”
I guess it is up to buyers making no downpayment to save the market?
People don’t pull the trigger because they’re afraid they’re going to lose their down payment
I think this is a profound shift in the market.
The only ways to now bring in buyers are:
1. Fool them into thinking prices are rising.
2. Make them an offer that is competitive with renting.
The first options will soon be tough to pull off. The second option will cause rational pricing to return.
Good points JP, but I seem to remember that back in the 1980’s RE agents encouraged landlords to raise rents so that more people would be forced to look at homebuying. I wonder if they will just do this again. (I hope not.) Of course this time, there are so many more units for sale compared to “back then.”
That is one of the advantages to this blog - being able to predict and deconstruct RE agent tactics & strategies before these strategies become widespread.
~Misstrial
“I wonder if they will just do this again.”
They can’t. Too much competition, in the form of FBs turned landlord who desperately need a renter to help feed their alligators.
option 2 would be brutal i.e. 50 % discount here in OC, OUCH.
“Coachella Valley leaders gathered Thursday to address a looming crisis. Only 10 percent of valley residents are able to afford the $400,000 median-priced home and the nation’s eighth-worst house-price-to-household-income ratio.”
How about lower prices? Wages and affordability are what will eventually bring the market back to reality. All across the West you hear about $300k, $400k and up properties in the starter home category. Eventually, buyers must make real payments with real money on their mortgages and home equity loans, thus the beginning of foreclosures.
I cannot perceive how “economists” who should have a firm grasp of supply and demand can justify only short term price drops with an eventual stabilization at still inflated levels. They quote heavy demand for certain markets, but this demand eventually needs to be backed with cash and not credit- we are beginning to see this now.
Yes, as I’ve said before, $150-200k is plenty for most folks whose household income is in the $40-70k range. Truth is, that is most people in most parts of the country, except the big cities. $300-400k is simply unaffordable to all except the top 10%. Starter homes, my arse….!
That one made me really angry during the last few years. “Starter homes” that cost more than four times my income, and I’m well-established in a solidly middle class career.
Yep, $ 500K starter homes in Calif. Are people crazy or what? $500K is a lot of money.
“500K starter homes in Calif. Are people crazy or what?”
Yes!
Oh crikey, just TRY to find a starter home on the West side for 500K. Our friends bought one for about 550K a few months ago. It was a probate sale. The moment I walked in I muttered to my wife “oh man, it smells like someone died in here.” What do you know, the previous owner, an old man, HAD died in it and was there for a few days before he was found. We would very much like to buy but no way am I laying down money for an overpriced POS that still has the stench of death lying thick over it.
What’s wrong with you? Aren’t you necrophilic?
Sign of the times? Did anyone predict this?
`Flip This House’ star accused of fraud:
Now authorities and legal filings claim that Leccima’s true passion was a series of scams that included faking the home renovations shown on the cable TV show and claiming to have sold houses he never owned.
http://news.yahoo.com/s/ap/20070601/ap_en_tv/house_flipper_investigation
I watched one of these shows one time and the people made me sick- it was those flippers in San Antonio. All they cared about was making band aid repairs on the cheap and essentially screwing over the potential buyer. I can’t believe they showed the crap on TV. I was really rooting for there to be problems that would cause the flippers to lose their a$$ on the houses they were trying to flip.
Did you hear the comment one show where they do 10 sales a months? Wow. It also seems like they dont do much but get permits, bring in contractors and drive fancy cars.
Anybody who knowingly buys a house from a flipper deserves to get ripped off. It goes without saying that flippers are trying to maximize their profits, so most of their ‘band-aid’ repairs as Brandon so aptly puts it, are cosmetic only. Only people who intend to live in a house for the long haul have any real incentive to make real improvements and do the proper care & maintenance.
When I eventually start house-hunting, I’m going to expressly instruct tell the realtor, in the unlikely event I end up using one, not to steer me to any flippers, since I will not offer more than 50% of the listing price for any flipper-owned property.
The greatest moment in all of the HGTV type flipper shows was on Property Ladder. The family of fools in Huntington Beach, CA had bought the neighbor’s house and planned to “flip” it. They were planning to ask about $900,000 for this place but would not spend $2,000 to replace a rotted fence in the backyard. Instead they grew some stupid vines to hide the mess. A $900,000 house (and this was no $900,000 house) couldn’t even come with a new fence because it “wasn’t in the budget”.
At the end of the show they couldn’t sell. The snotty b*tch that was leading the family team said they were going to wait out the downturn. I wonder how that is working for them. Time for a Friday beer while I laugh at their misfortune. Bwahahahaha.
I keep threatening my wife that I am going to record a dolphin sound on my voice recorder and when we tour an open house that is obviously a flipper I will play a loop of it just to see the reaction I would get.
My fav took place in Long Beach with the mystical black woman who had the house which talked to her, and told her to paint the outside big bird yellow. It also told her to go way over budget, then list it higher than the median for the area, then it told her to lower the price slower than the slide. At the end of the show they were showing the weeks flying by and how much she was paying for these months and her profit gone and looking to break even. Who knows how much she lost, they just said it wasn’t sold at the end…so dumb.
Vannuys you sick bastard!! LMAO
Just for the record my brother looked for a rental a few months back. I said if you see stainless steel and granite just walk out.
Nice.
I believe I saw an episode where those jackasses spray-painted a lawn green the morning of the open house.
Hey, this was a TV-show. People believe what they want to believe. So people are a part of this (real estate bubble) problem.
Now this is freakin’ hysterical.
Only 10 percent of valley residents are able to afford the $400,000 median-priced home
I seriously doubt there are many earners at the $130K a year level in Coachella Valley. 10% seems VERY high.
may be only 10% with funny loans.
“I seriously doubt there are many earners at the $130K a year level in Coachella Valley. 10% seems VERY high.” I’ve been looking into jobs there and you are right. Nothing there approaching that unless you are in the medical field, retirement planning and of coures…real estate. Ever been down the 111 through Palm Springs??? Realtor offices every quarter mile…I kid you not.
The Coachella Valley is in full-on meltdown as we speak.
I rent (for a song) in a new construction flipper neighborhood and there are 2 foreclosures and 4 in default on my block alone.
Per ziprealty there are at least 638 foreclosures and 1288 NODs in the Coachella Valley as of today. I watch the foreclosure numbers closely and they have acheived orbital upward velocity in the last 3 months, approximately tripling in number in my zip code alone.
Inventory is up to 10,000 and last months sales count was 830 something. The “season” is over. The CV has about 350,000-400,000 residents.
I speak with many realtors/mortgage sharks/flippers in my line of work, and they are in one of 3 camps: apparent denial, scared or borderline depressed. One flipper who used to brag about having “millions” in real estate is now thinking about selling boutique health care products—no money in real estate. The Countrywide mortgage brokers are the only ones who seem somewhat normal vs last year although they never fail to hit me up for a loan. Many RE agents are still saying this will never be as bad as the 90’s…but I can tell in their eyes they are only hoping
“A bill that would have created a pool of money to help subprime mortgage borrowers facing foreclosures to refinance their loans died in the state Assembly Appropriations committee Thursday.”
Bummer. I’ve always wanted to go for a swim in a pool of money. Guess I’ll have to wait a little longer and just keep swimming in my office football pool for the time being.
“A bill that would have created a pool of money to help subprime mortgage borrowers facing foreclosures to refinance their loans died in the state Assembly Appropriations committee Thursday.”
LMAO! Must’ve been an ugly death. Wonder how many folks were waiting with bated breath. Hope they didn’t turn blue.
Shrinkage in the pool. We have all experienced that at one point or another in our lifetime. I just pee and then jump out to get a towel.
You musta grew up reading Scrooge McDuck - whatta guy!
My brother and I both grew up loving Scrooge McDuck. A couple of years ago I bought one of those plexiglass cubes about 3″ on each side, I think designed for showing photos. Instead I filled it with widowed earrings, foreign coins, leftover drapery hardware, anything shiny. I put a little label on each face saying “Scrooge McDuck’s Money Bin” and gave it to my brother for his 65th birthday. He loved it and kept it.
“When asked why, nearly three-quarters of them said they feared they’d buy a home and then the builder would lower prices again, effectively wiping out new buyers’ home equity.”
How could they have equity when they had 100% financing. According to his statement these fools would rush into buy if the builder guaranteed he wouldn’t lower his prices. The fact that so many are looking says they still don’t get the big picture and that the old mantra ‘RE can only go up’ is imbeded in their brain.
more like that it never goes down.
“The number of default notices in Gilroy nearly tripled in early 2007 compared to early 2006, according to a DataQuick.”
I love it. Early last year while in Costco I talked to some RE’s s selling RE through Costco’s program and really unloaded on them. They thought that I was a joke especially when I asked them what job they expected to do in the future when RE collapsed. If I’d have taken their pictures I’d go into the new WalMart there and see if any ended up as a WalMart greeter!
They can get a job collecting carts in the Costco parking lot or folding clothes at the Gap outlet.
The latest OFHEO HPI data, released today, is graphed here:
http://www.housedata.info
This is NOT the time to PANIC in CA.
PANIC Time is scheduled just before SUICIDE Time 1st Quarter 2009.
Please take a Number, a Rope and WAIT quietly in the Corner for your TURN.
“‘People don’t pull the trigger because they’re afraid they’re going to lose their down payment, and I don’t blame them,’ Catalde said. ‘I’d be concerned too.’”
No ifs, ands, or buts this is the way it should be. I grew so tired of lenders providing “creative” programs to make housing more “affordable.” It didn’t, it made things less so.
The only way to keep the game fair for all is to require borrowers to fork over some skin.
How about a pound of flesh while we are at it?
SHYLOCK
What judgment shall I dread, doing no wrong?
You have among you many a purchased slave,
Which, like your asses and your dogs and mules,
You use in abject and in slavish parts,
Because you bought them: shall I say to you,
Let them be free, marry them to your heirs?
Why sweat they under burthens? let their beds
Be made as soft as yours and let their palates
Be season’d with such viands? You will answer
‘The slaves are ours:’ so do I answer you:
The pound of flesh, which I demand of him,
Is dearly bought; ’tis mine and I will have it.
If you deny me, fie upon your law!
There is no force in the decrees of Venice.
I stand for judgment: answer; shall I have it?
Just think how much more affordable houses would be if 40-50% pounds of flesh (downpayments) were required. Don’t get me wrong I like the benefits of leverage, but this go around things got way, way outta control.
“The only way to keep the game fair for all is to require borrowers to fork over some skin.”
It will also re-establish a link between income and housing prices, which would be nice -);
Zero downpayment, sure we could all go out and get expensive houses. Requiring 10% or 20% down and a full P+I payment, and what’s “affordable” is a whole different ball game.
http://news.com.com/Notorious+debtor+Serin+shuts+down+blog/2100-1026_3-6188143.html?part=rss&tag=2547-1_3-0-5&subj=news
David Spade should play Casey in the movie version.
I’d like to know more about the woman who was silly enough to marry this loser.
http://www.caseypedia.com/wiki/Galina
Shame on you for knowing that site existed :). Do you have a crush on him?
Are you kidding? I was one of the original Haterz before it was cool. I was beating him up regularly on his blog but finally got banned.
I prefer my men with all their male parts still attached.
Reminds me of The Matrix, dodging all those bullets like that.
“In Solano County, the median price of a home sold was $428,000 last month”
So the median household income in Solano County is $143,000? No? Then I guess prices still have a way to go down…
I wonder if the realtor that I used would be mad if she knew that the house I bought in 2001 was 1.4 times income? Of course she never knew what I made but there’s a part of me that thinks a realtor would get very upset if a buyer was not “buying at their level to help support prices and allow others to get into the lower cost housing” or something.
What I found was that doubling the price of the home did not double the value - and this was in 2001! I can’t imagine what 2005 was like for buyers…
“there’s a part of me that thinks a realtor would get very upset if a buyer was not “buying at their level to help support prices and allow others to get into the lower cost housing” or something.”
I agree. It is crazy the crap that people in various occupations think others should do to support their livelihood. I had a very vocal argument with a construction subcontrator not long ago. He was literally screaming at me that he wouldn’t have a business if it wasn’t for illegals. (who he pays squat and then dumps on the community and taxpayers for health care and education of their kids. Guy’s a total rip-off, rips off his labor, his customers and his neighbors.) In that case, he shouldn’t have a business.
“he shouldn’t have a business.”
Actually, he shuld be in jail. Knowlingly hiring illegal labor is against the law, so is violating minimum wage laws, and failing to pay the employer share of FICA as well as withholding federal, and all local taxes. In addition he may well be violating OSHA standards…depending on the equipment his employees are required to have while doing their jobs.
To bad the laws are no longer enforced in this country.
Palmetto, yep, and until voters scream back loud enough to shut this guy down and realize that they are subsidizing his profit margin, they will keep ripping society off.
I wonder how the baby boomers are going to respond when they realize that more and more benefits are going to have to be cut to pay for all the new “citizens” waiting to be created by our government. “citizens” who take $22000 more in taxes than they contribute each year. I wonder what AARP’s stand will be when many of their consituents are facing a future of eating Alpo to pay for the 20 million new citizens of AmeriMexico who are soaking up billions of dollars that were originally paid in by retiring seniors.
The next 10 years are going to be pretty interesting.
OCmetro-
Where did you find the 22,000 figure? We are constantly bombarded with propaganda that illegal residents pay more in taxes than they consume.
Personally, I think the propaganda fails the common sense test as well as the hard figure test…unfortunately everyone computes the numbers a different way and it’s difficult to argue because the numbers are so biased.
I don’t know how very low taxes rates on low income-earners can possibly pay for all the additional infrastructure/teachers/schools/police/prisons/social workers/benefits coordinators and the list goes on. Seems like those services are paid by middle-income earners. But I could be wrong. Somebody prove me wrong.
What is up with the PHX market?
Zip shows a drop in listings by about 700 in the last week, from 53,500 to 52,800.
People giving up and taking them off MLS? I know one near me that was listed through a realtor at $260K just went FSBO for $235K. Craigslist real estate for sell is getting 100 postings an hour today.
Who knows, although I hate to say it but “12,000 people move here every month” so maybe combined with builders starting to get the message sales are actually starting to take a bite out of the inventory? Do you have sales numbers that show increases? I htought we were at about 10 months inventory. As you say a bigger part could be people giving up and going CL rather than MLS.
I haven’t seen any May numbers yet. AZ Central’s “find recent trnasactions” page doesn’t show anything beyond end of April.
Realtors seem to think I can sell if I’m willing to undercut the market by $5-$10 a sqft. That is $132-$135 per sqft compared to the most recent comp in my neighborhood that went as a short-sale the end of April for $142 per sqft.
I still see bonehade listed for $170-180 a sqft.
Or this genious that MUST SELL for $230K….
http://phoenix.craigslist.org/rfs/342904000.html
Checekd tax records. It is under 1200 sqft, making it $190 per sqft.
Some people need to WAY get real.
Uncertainty? What uncertainty? I’m certain prices are too high and the laws of economic gravity are beginning to erode the orbit of the prices in the Bay Area and throughout California. Prices may not fall in a crash and burn scenario here in the Bay Area unless we have a really strong earthquake that knocks out the infrastructure and burns a few neighborhoods down. But there is going to be a very long and protracted period of stagflation. Prices are too high to go any higher there is a point at which economic balance limits increase.
Builders and sellers are still believing people can afford buying into this market..the truth is there are still some who can…if they use the equity in their existing home by selling it…..BUT…who’s going to buy that house? The bottom crumbles…..the top falls…. The bottom is crumbling it’s only a matter of time before the top falls. How far is the question…….Uncertainty? Nah…I’m pretty certain about this.
“‘This year, there is nothing,’ he said. ‘Nobody comes through the subdivision. I think we’re in for a down year and we’re in a bad situation for next year.’”
Ya think?
Been tracking CA foreclosures through Foreclosure.com and compiled a graph(shot out to Jim in San Marcos for early data). Think I did this right. Any math geniuses out there please correct me if I made a mistake. It appears that the exponential increases in foreclosure rates are not subsiding, but of course, all is well with the economy and housing is due for a turnaround any day now.
http://www.putfile.com/pic.php?img=5585122
No Bots, You are right…Check out this chart from Patricks Blog…We have a looooong way to go:
http://www.belowthecrowd.com/photos/ackman.jpg?ref=patrick.net
Nothing quite like “The Chart.” So ghastly and oh so beautiful at the same time.
Oh good (I mean yikes!!) WOW!
Reminds me of an exchange in Rocky 3…
Interviewer: What’s your prediction for the fight(housing market)?
Clubber Lang: My prediction?
Interviewer: Yes, your prediction.
[Clubber looks into camera]
Clubber Lang: Pain!
“Any math geniuses out there please correct me if I made a mistake. It appears that the exponential increases in foreclosure rates are not subsiding”
Am no math genious but in Foreclosure.com for LA County I have noticed a sharp uptick in Foreclosures in MAY. It seems as if it jumped from 3600 to 5300 in just last several weeks. This is roughly a 30% increase( 5300 X 30%). This is at the height of the supposed spring selling season, which IMO is turning into a bombout.
Also seeing quite a few for sale sighs posted on the weekdays: this in selected areas of LA/ North OC counties, more in the rundown areas than in the upper class hoods.
it jumped from 3600 to 5300 in just last several weeks. This is roughly a 30% increase
5300/3600 = 1.47, so it is in fact a 47% increase.
Foreclosures are definitely skyrocketing up at an exponential rate — just like the rate of growth in number of cases of a disease (like SARS) during the early stage of an epidemic.
Love the book covers — are they real?
“Love the book covers — are they real? ”
I wish! I photoshopped those a while back after I was enlightened by this site. The crashing house pic was posted on the David Lereah Watch site as well as a few other sites, so I imagine he might have taken a peek at it. I don’t check in too much here, but I’ve always enjoyed your comments. My favorite source of news and entertainment! Keep up the good work!
http://www.cnbc.com/id/18963284
I don’t even know what to say about this…
Wow… Just when you think you have seen it all.
Another flipper in total denial. Talking to this man’s wife led me to believe the hubby had lied to his spouse. They bought a home for 888k she tells me they expect to get 1.3 miliion in Oct when the market turns around? I give her this funny look, she says don’t you think we will get it , the hubby here’s this conversation and wisk the wife away from me. Here is a guy who is flat lying to his wife about the market when that happens you know Fred and Ethel are in to deep?
“A simple trip to Redlands will become a mess, Husing told the crowd. ‘You need to have affordable housing here or you’re condemning people to an abominable lifestyle,’ Husing said.”
Mr. Husing, the good folks of CA have already been condemned to an abominable lifestyle. Just look at the freeway during any given rush hour. That is why a lot of us packed up and left. So nice not to have to ‘plan’ your driving around the traffic parking lots. Just go when it is convenient, any direction that is desired and do it at a normal speed. And, don’t even get me started on my rant for the housing prices. Oh, I think that has been adequately covered here by plenty of our good bloggers.
We’re gonna pay more, like it’s 2004…
“‘We can’t continue living like it’s 2004,’ during the red hot Bay Area real estate market, Dennis said.”
I was dreamin’ when I wrote this
Forgive me if you saw them overpay
But when they woke up from mourning
Could have sworn it was judgement day
Their bank accounts were in the red
There were people foreclosing everywhere
Tryin’ to run from financial destruction
You know I didn’t even care
They say two thousand zero four, party over’
Oops, out of time!
So tonight i’m going party like everything is still fine
I was dreamin’ when I wrote this
So sue me if it all went up too fast
But housing bubbles are like a party
And parties weren’t meant to last…
Last weekend we were walking the dog around the nicest part of Toluca Lake and noticed three things:
1) More “for sale” signs than we’ve ever seen there this past 15+ years.
2) At least three (3!) totally empty, unkept houses with no signs.
3) Six contractor spec major refurbs in progress (ouch!).
It’s happening, folks!