Bits Bucket And Craigslist Finds For June 8, 2007
Please post off-topic ideas, links and Craiglist 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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I’ve got a question:
There is a guy at work who knows that I try to follow the housing and foreclosure situation. He came up to me yesterday and said that, at a cost of absolutely zero dollars to him, the holder of his second mortgage offered to lower his interest rate 0.25%. He asked me if I knew why a company would do that. I fired all 7 of my brain cells at once and came up with nothing except to perhaps keep the money flowing at the mortgage company. Anybody else got ideas? Does it suggest the company is in trouble and perhaps he should try to negotiate a lower rate?
Is he sure they won’t be tacking the difference on to the end of the loan? I know some banks are extending people’s mortgage terms longer (ex from 30 to 40 years) which will lower the payments but cost them more in the long term. If I were him I’d be especially suspicious and read all the fine print carefully. Besides, a .25% rate cut isn’t usually going to be the difference between keeping a home or losing it in foreclosure.
Two guesses:
1. He’s afraid you’re going to refinance.
2. Would it involve switching from writing a check every month to bi weekly electronic payments?
It may be due to automatic withdraws from his checking account. My bank dropped my mortgage by .25% when I allowed automatic withdraws.
I have made unilateral offers of small rate reductions when loan demand was slow. I used the lower rates as part of a “lower your payment” gimmick, where the term of the mortgage would indeed be extended somewhat. And, the “afraid they’ll refi” was indeed part of my motivation. Right now I would not be offering rate reductions, and don’t understand why others would do so.
You guys hit it. It goes back to the full length of his original loan. So it added 2 1/2 years on to it, I don’t know how long his original loan length was. No bi-monthly payments or anything like that.
Once a debt slave, always a debt slave.
Got 10% down?
Also it might have something to do with changing a purchase money note to a refinance note so the note holder has recourse .Borrowers beware of the industry trying to get out of the contracts they made .
Yeah I’d be worried about any renegotiation, and would read the fine print a dozen times, and even if I saw nothing probably would still decline given figuring I missed the catch somewhere…
” Does it suggest the company is in trouble and perhaps he should try to negotiate a lower rate?”
Sounds like they will redo the loan and add a HELOC account to temp him to use it as an ATM. Plus they will put in a small clause saying that if he refi’s the loan within a certain time span he will incur a large prepayment penalty.
The note holder may have purchased the note from the original maker at a substantial discount.
Another point: Is the second loan from the original purchase and is it non-recourse? With the current housing market, non-recourse seconds are not very valuable. If your coworker has a good credit score and the second is made recourse due to the refinancing process, it is worth more to the lender, even with a lower rate.
The WSJ describes yesterday’s bond market action as a “mortgage puke.”
My sister-in-law called last night to ask for my advice on whether to “lock in” today (they are buying a home but have hesitated to lock in rates). What could I say? Truth be told, I have the feeling we may be looking at the worst bond market crash since 1989, but I did not have the heart to tell her the full story…
I was reading an article on Bankrate.com recently that talked about a “floating rate-lock.” The rate can’t go up, but if it goes down, then you get the reduced rate. Might be worth seeing if she can negotiate that?
Surprise, surprise. The Plunge Protection Team arrived this morning at exactly 9:45am. The homebuilder stocks were plummeting in the first 15 minutes of trading but the PPT took care of that. I checked 7 of the big builders and the charts show that at EXACTLY 9:45am all seven went from plummeting to soaring. All were up sharply!
Dumb me. I once thought that we had free markets!
TOL is certainly true. What other builders?
KBH too. Heavy sigh. Anyone else want to buy a small Carribean island and move there?
In additiion to TOL, the other builders that had exactly the same trading pattern were:
RYL
BZH
CTX
LEN
DHI
PHM
I hope someone on the inside breaks the code of silence some day to expose all this govt manipulation of asset prices for what it is.
This just in………….Mortgage rates no longer at “historical lows.”
Hopefully they’ll deepsix that irritating ad with the 20 year old girls dancing around in front of the computer. I think those are in my top 5 of most annoying ads ever.
We can only hope, along with those horrible banner ads of people dancing.
I’m gonna miss those gay cowboys line dancing.
Wow, I don’t watch enough TV. I’ve honestly never seen those ads. Sounds lovely, gay cowboys and dancing girls! Yep, that would convince me to sign for a loan of a few $100k’s with that company.
That banner ad of the fat chick dancing with the guy was horrific. I couldn’t stand it.
I agree. That was the worst one. If they’re going to accost me with the silly idea of people dancing in order to get me to borrow money, then I insist they at least use attractive models!
Did you notice that the fat chick and husband seemed like they were probably black? I think that company was probably trying to appeal to the poor minority crowd. Oh well, I’m sure there are at least a few attractive poor black women who would be willing to star in a mortgage ad.
I just fell out of my chair.
Now’s the time to really fire up that popcorn machine. Gonna get ugly.
AMEN BROTHER
higher rates will put more downward pressure on prices and
create more unhappy bagholders!!
what a difference a few years makes
my rent payment is not adjustable lol
Are you saying you live in a rent-controlled building?
For practical purposes, rents in bubble areas are probably only downward-adjustable for the near future.
The same madness we see in wishing prices of For Sale homes now plagues the rental market, with a huge gap between wishing rents and actual, market rates.
Don’t worry, Adam Smith’s invisible hand will slap around these wannabe FB landlords pretty quickly.
A friends sister who bought at the peak couldn’t understand why I am rooting for higher rates. “Maybe the cost of the home will come down but you’ll pay more in interest.” I answer, “I can renegotiate my rate when they come back down. Can you go back to the builder and renegotiate the purchase price of your home when the value drops?”
A blank stare
Nicely put.
“A friends sister who bought at the peak couldn’t understand why I am rooting for higher rates. “Maybe the cost of the home will come down but you’ll pay more in interest.””
Plus I have a lot of cash and would rather make a 40% downpayment than a 10% down payment. And just because interest rates double doesn’t mean hte payment does!
Let’s see, what will be the new sales pitch…
1. Buy now before rates go up more.
2. Upward rates means rents are increasing.
?
I’ve seen the desperate, “Why rent when you can buy?” Akin to, “Why pay less when you can pay more?”
Neumann Homes advertising insert in today’s Chicago Trib:
Can’t sell your old home? We’ll buy it from you TODAY! And take your worries away
All this, and the 10yr note is climbing to the heavens (5.23%) as of 7am central. Good luck Neumann…suckers.
Have you exited your long positions? That was a good call back in March. I was looking for a double top and did not expect what happened.
Yes txchick57, I’m on the sidelines for awhile….greed has got the best of me over the past year. This bond selloff doesn’t bode well at all for, especially, housing. Bernanke is sure to be talking to Volcker, gleaning insights from his impotent experience vis a vis interest rates in the 80’s.
Hope you made lots of money since Feb.
I’ve been scalping, that’s all. I did fine with the W bottom in Feb/March but just can’t stomach riding this monkey train. If we really break down and liquidity starts draining, I’ll be happy, that’s my preferred environment.
It may be happening.
The Street is nervous about the 5% plus 10 yr yields.
If the yields remain this high, you will see capitulation in the stock market.
(we’ve talked about this a few times over the week… but it is the 10 year yields which have had the Street spooked all month, not China)
10 year bond going up again this morning…at least another .05%.
A week or two of this and look for a good 3000-4000 point drop in the NYSE and a 1100 S&P.
Liquidity or just plain spending cash will go away for awhile will bring some deflationary sanity back to all things.
Capitulation? Maybe in about 4-5 years.
Don’t say that, txchick, I got puts expiring in 2 years!
Watching today’s opening bell action on Wall Street:
“In this corner the Plunge Protection Team. And in this corner, the Pimpco Bond Market Bear Team.”
http://www.marketwatch.com/tools/marketsummary/
“If the yields remain this high, you will see capitulation in the stock market.”
Inspector –
Are you suggesting the PPT will allow this, that you don’t believe the PPT can actually control the market, or something else?
The end of private equity is being discussed on CNBC. Thank goodness - that game for the rich has hurt a lot of people and can’t end soon enough.
“If the yields remain this high, you will see capitulation in the stock market.”
Inspector –
Are you suggesting the PPT will allow this, that you don’t believe the PPT can actually control the market, or something else?
——–
Both. I don’t think the PPT would be too worried about a “controlled” consolidation in the stock market, let’s say 5-10% over the course of a few weeks.
I also don’t think they are powerful enough to stop a tide of selling, even if they wish to stop such a tide. Hence the downturn of 2001-2003.
The problem the PPT faces is the magnitude of the situation. There are just too many things to control currently. I would have to believe that they would need massive amounts of money to keep the game aloft… and injecting this needed amount of cash would require hyperinflation (of the Weimar Germany scale). I’m not sure that the powers that be are prepared/willing for hyperinflation… yet.
The game that Alan has created is still working relatively well. Continue stealth inflation, year after year… a slow steady inflation that is just enough to keep the ponzi game working, but low enough to keep most of the populace unaware. Also low enough to keep the foreign central banks from fleeing the dollar.
I have a question for all those who say the bond markets are going to tank. I’m not an expert at this so some of my terminology may be off. Just bear with me. I understand how and why bond prices move in opposite direction to bond rates. However, I just don’t understand the concept of the bond market tanking.
Take this example. I buy a $1000 10 year bond at a 5% rate. Right after buying the bond the rates jump to 7%. From my calculations, my bond is now worth $828. (An $828 bond at 7% would pay out exactly the same as my $1000 bond at 5%.)
Sure, that sucks that I could have waited and got more for my money. But, I didn’t buy the bond to sell it short-term. I bought it for the duration. In 10 years I will have $1628. (That’s true even if the rates jump to 20%.) At some point I’m guaranteed to come out ahead.
I essentially traded $1000 at 5% for $828 at 7% if you want to look at it that way. Sucks losing money but if I look at it like I lost money I have to also look at it like I gained in the interest rate.
So I think the “tanking of bonds” should be taken with a grain of salt.
This all assumes that I am not buying junk bonds and the risk of default is minimal. That is a different issue altogether. This also doesn’t consider the affects of rising inflation which is also a concern.
Am I totally off here? Do I not understand how this works?
Your theory is right if you buy an individual bond and keep it until maturity. No risk at all (besides inflation) - you know what you get and when. (Although I would argue inflation is a huge risk. What if bonds and other fixed income products go back up to 15-20%? Will you even notice the 5% with major inflation happening?)
But most people buy bond funds (except my clients :D) so when the value of individual bonds fall so does their principal. People start pulling money out of bond funds, managers have to sell more and more bonds below their purchase price to get the money back. Your yield may be strong but who cares when you are watching the value of your portfolio fall in the SAFE investments?
Thanks, SD. And I’m afraid to say I do have some funds that invest in bonds as well.
I am not a bond trader and don’t know how they use the words, but I would use them slightly different from you:
a 1000 USD bond gives you 1000 USD at maturity. For a 10y life and an interest rate (yield) of 5%, the bond costs you now 613.9 USD (1000 / 1.05^10). If the yield goes up to 7% tomorrow, the bond will be worth only 508.3 USD (1000 / 1.07^10), you lost 105.6 USD in a day - I would call that tanking. If the yield goes to 20%, your bond is only worth 161.5USD - I would call that a wipe-out, even if you have some change left. Now, the yield didn’t jump that much recently, but the money amounts moved in the bond market are not measured by thousand but millions or billions. Assume for a moment that China has a trillion dollar in 10year bonds at 4.5%. After a jump to 5.25%, they would have lost 44 billion.
> In 10 years I will have $1628. (That’s true even if the rates jump to 20%.)
Yes, but why did the rate jump to 20%? A hint: it ends with …nflation: Your 1628 USD don’t buy you much anymore.
“May was the best month of 2007 but the worst May of this decade, and it was 19% below May 2006, the previous low mark.”
“The trend is up, which is a good sign,” said Matt Moroney, executive director of Metropolitan Builders of Greater Milwaukee.
Umm…ok
i’d like to nominate Matt Moron for new spokesperson of NAR
http://www.jsonline.com/story/index.aspx?id=616709
HB stocks got their butts whipped, 52w lows busted on heavy volume. Guess is selling climax ? Want more down but expect some kind of rally.
Thoughts ?
Oh heavens no. Selling climax? Maybe in a year or so.
Disclosure: I haven’t looked at any of the charts for support areas but a bunch of them busted triple bottoms this week.
FOR PACKMAN (regarding yesterday’s Treasurydirect.gov “rollover” plan):
Packman wrote:
“Presumably by “rollover” you mean that after a treasury matures - rather than credit the money back to your bank account, the money is applied toward purchase of the same treasury in the next auction (or maybe the same action it’s sold in)?
When that happens - I guess then just the gains are credited to your bank account?”
It’s not REALLY a rollover, because it’s not putting the full principal plus interest into the next treasury. Instead, it credits your bank account with the principal and interest, and THEN immediately withdraws enough money for the next treasury. (so you’re not getting compounded interest)
Here’s how it works. Let’s say you have $8,000 to save. (I use this because this is one of my “rollovers” right now).
So you go to Treasurydirect.gov, and you put in that you want to buy $8,000 worth of a treasury, in this case a 4-week TBill (again, that’s what I chose). you also put in that you want it to “rollover” or “repeat purchase”.
The auction for TBills is always on Tuesday, and the purchase occurs on Thursday. You must get your request in BEFORE Tuesday to get that price.
So then an auction will happen the FOLLOWING Tuesday from when you put in your claim. That Tuesday the “price” will be set. You buy the Treasury at a “discount” then you get the full price back when it matures.
So on 5/10 I bought a $8,000 4 week TBill for $7971.13. Then it matured yesterday, and $8,000 was put in my account. (so I got 8000-7971.13= $28.87 in interest over 1 month).
Then right away, $7971.07 was withdrawn from my account (because this is the “price” based on the auction that happened on Tuesday). 4 Thursdays from now, I will get $8,000 deposited in my account again, and then immediately another $80000 TBill will be purchased (again at a discount, depending on the auction that occurs in 4 Tuesdays).
The interest remains in my checking account, unfortunately, because thus far you can’t set it up to automatically apply the FULL principal and interest to purchase a new TBill.
you can sit down and do the math and set it up yourself if you want though…. (so you could enter manually which dates you want to invest whatever amount).
Thus, it’s not a true “rollever” because you don’t get true compound interest, since interest goes into your bank acct, not back into the next treasury.
anyway, it’s very simple to do. Took me about 5 minutes to set it up. Then it took a little bit to figure out the navigation on their site. It’s a little TOO simple actually, their site could be a little smoother… but once I got the hang of it, it was easy as pie.
now, whenever I reach a certain threshold in my checking account, I just use that to bid on treasuries and set them to pseudo-rollover (it can be any amount).
I must have like 15 different rollovers going on right now.
Luckily, it charts it all for you so you know when it’s going to happen.
OH: and one key thing, when you’re doing recurrent “rollovers”, Treasurydirect ALWAYS puts the money INTO your account before withdrawing the next auction, so you don’t overdraft your account.
Thanks a ton! I’ve set up to buy a 4-week bill next week as well. I don’t see a spot to indicate rollover, but I presume that will be available in “Current Holdings” after the purchase is made (right?).
It’s interesting that for their rollovers (per se) that they perform a credit and then subsequent withdrawal. Presumably this means that there’s actually a 1-week gap in the rollover? - e.g. they “sell” the bill back to you one week and then buy it back the following week?
(P.S. to blog readers - sorry for the complete tangent - seems like good info though)
Nope. They “rollover” occurs on the same day. So yesterday, my 4 week TBill proceeds from May were put into my account, and then my TBill was bought for June at the same time.
You set up the “rollover” when you make the initial purchase…
I can’t do it from work (don’t have my passcode) so I’ll figure it out and put it in the blog tomorrow so you know how to do it.
Like I said, their site is a little odd.
HIC
HIC, do you use the “Legacy” version of TreasuryDirect? I’ve never seen the “rollover” option. All I can do is specify whether the maturity payment goes to my bank account or my TreasuryDirect “Zero Percent C of I” account.
It ain’t over yet, but the immigration bill stunk out the joint yesterday. Ladies and gents, this is a close one. If we get anything resembling this POS legislation, the US is done, toast, finito as a sovereign country and we’ll be discussing our trades in Ameros, not dollars.
http://www.cnn.com/2007/POLITICS/06/07/congress.immigration.ap/index.html
“This is the president’s bill,” Reid said. “… We can’t do it alone over here. We need some help.”
OMG Sen. Reid at this point Prez Bush’s base hates him even more than they despise you, just because of this POS immigration proposal.
Are all Beltway politicos really that clueless, or do they just play it on TV?
“Are all Beltway politicos really that clueless”
They have to be clueless, otherwise they might have to actually deal with real issues. Bush, meanwhile, had a little stomach distress over there at the G-8. At first I thought Putin might have slipped him a little radioactive mickey. But it seems he’s perking up. Well, at least he didn’t hurl on some prime minister like his pappy did over in Japan. Be thankful for small favors.
Are you kidding? This way they get to support the bill and blame Bush when it doesn’t pass. Best of both worlds. Suporting it is still popular with their base so they get credit for trying and it is unpopular with independents so they don’t have to handle the amount of blame they would get stuck with if it did pass. The extreme partisans will give you some credit for trying. As long as it doesn’t pass the people with some opinion (but who are much less passionate about it) won’t blame you, much.
Besides, anything that puts Bush in a position where he has to piss off his base more is pure political capital. If Bush becomes even more unpopular, he won’t be able to get any republicans to go to bat for his judicial nominees.
Not clueless at all. Very beltway.
Senate Majority Leader Reid apparently called the millions of illegal aliens in this country “Undocumented Americans” recently: ”bring the twelve million undocumented Americans out of the Shadows.”
(Google the incredulity for yourself)
Clueless indeed.
I paid 10 bucks a week to the NSRC every week that this bill didn’t get past the Senate. And I’m going to do the same thing every time this bill comes up again this year, next year, the year after that… http://www.nsrc.org. And I’m a Democrat.
P.S. I think this strategy would prove to be effective for all sorts of “negative” action, e.g. if LittleBoots gets another vacancy on the Supreme Court (pay the Dems each week to filibuster)
I donated to some grassroots.com organization since over a year ago when those immigrations rallies started. I’m adding my donations to these organizations against illegals taking over America and destroying what culture we have left.
“I’m adding my donations to these organizations against illegals taking over America and destroying what culture we have left.”
ignorance at it’s finest. do you think the Irish will ruin American too? or the Germans, like Washington worried about a few hundred years ago? or any other ethnic group that isn’t your own?
I lived in the same neighborhoods as them. I know them. There was a gang fight on the front lawn outside my bedroom window by people from across the border. You don’t know them - typical liberal.
“ignorance at it’s finest. do you think the Irish will ruin American too? or the Germans, like Washington worried about a few hundred years ago? or any other ethnic group that isn’t your own? ”
Mr. Law,
does the word “illegal” mean anything to you? No poster on this blog has made any reference to the ethnic background of legal immigrants–you know, the folks who apply to enter the country, follow the rules, wait their turn, pass background and medical checks, and arrive ready to contribute and participate as Americans.
People here do object, strenuously, to lawbreakers.
This “ethnic” crap is meaningless…the objection is first,last and always to permitting and rewarding lawlessness.
As for ignorance…having failed to grasp the substance of the issue, I suggest you check out a mirror.
I don’t get it, how will illegals ruin a country anymore than legals? I don’t need to check out any mirror.
“I lived in the same neighborhoods as them. I know them. There was a gang fight on the front lawn outside my bedroom window by people from across the border. You don’t know them - typical liberal.”
yes, you’re right, all illegals act like this. I know this from the fight on your lawn you just told me about. obviously that means all illegals are bad and destroying our culture.
Clearly you’re a high school kid with too much time on his hands. When you’re old enugh to vote, let us know.
Town Homes a Steal in Fort Myers
“You’re not going to believe what some brand new townhomes went for on the auction block Thursday night in Fort Myers, considering where prices have been.”
Greg Toher was outraged when he heard the prices some of the homes were going for. Walking out of the auction room, he told us, “$145,000! Unbelievable! We paid $300,000! They just got rid of at least four for $145,000!” He says he closed on his three bedroom San Simeon townhome in December, “You’ve got to be kidding me, that’s not fair.”
LMAO! I smell a good Florida thread coming.
Just when you thought you’d heard it all, the FLA thread steps up to the plate.
Well Greggy boi:
It looks like ya gotta face your retirement like a man and realize you are going to die in that house b4 you can sell it and make a profit.
I want to see his frowny face with tears. “You promised! It’s not fair!”
Greg Toher was outraged …Walking out of the auction room…he closed on his three bedroom San Simeon townhome in December, “You’ve got to be kidding me, that’s not fair.”
I wonder what Greggy was doing at the auction if he had already purchased a townhome. Speculating perhaps? How unfair that he was unable to flip his for a tidy little profit.
So why didn’t he bid $146K?
Fool him once, shame on him. Fool him twice, he’d have two townhomes that he paid too much for.
What? And miss his chance to lower the dollar cost average of his investment?
I wonder if he goes to car auctions after buying expensive financed cars and complains to the sheriff/impound that they’re selling below market value.
Anyway, his comments just crack me up. Sale price at auction, unless the damn thing is fixed, IS market value. And the only reason to fix an RE auction is a collusion between two parties to cheat the IRS. (Unfortunately, there are plenty of reasons to fix vehicle auctions … been there.)
essessemm: Great find! The funniest part is the one about the “market value”.
“I feel really mad, really sad, hurt.” Victoria Toher said the developer went back on their word, “They promised us they were not going to go below market value.” A Levitt and Sons representative told WINK News on Thursday night that the homes did go for fair market value…as determined by the hundreds of bidders at the auction.”
“I feel really mad, really sad, hurt.” Victoria Toher said the developer went back on their word, “They promised us they were not going to go below market value.”
Which is the bigger idiot? The developer who told her that or the one who believed it.
Don’t believe that the developer didn’t know what he was saying. As for the one who believed it, that would be fine; her problem is that she didn’t understand that houses always sell for their market value.
Not always–fraudulent transactions may be higher or lower. Eg, cash back fraud (higher), tax fraud (lower), etc.
“I feel really mad, really sad, hurt.” Victoria Toher said the developer went back on their word, “They promised us they were not going to go below market value.”
Don’t know how to break this to you honey, but I guess market value is $145,000.
I think that’s essentially what the developer on the news last night about market value.
SAID about market value
The really beautiful thing here is that the builder is still building; he can profitably construct more housing at 1/2 off peak prices. This does not bode well for anyone who is expecting any sort of market recovery or reduction of inventory without establishing new baseline pricing.
This will very much help bring prices back in line.
Healthy to see townhomes going for under $150K, which is a point at which the typical Floridian two income service industry family can buy without subprime loans or too much of a financial burden.
Up in the Panhandle, I just got my first ‘we have buyers, we need listings’ postcard in about two years. Granted, rents have gone up and prices have slid a little in recent months in my neighhborhood, but you’re still talking about it being $800 more every month to buy a standard 3/2/2 than it would cost to rent it, so I’m not sure how many people would think it’s a good deal.
Ya’ll want the really good news…
One of the guys i work with has 17 SFH in North Port. He has been buying since ‘84. He just told me this a.m. he bought 3 more SFH this week. The price…300k,for all 3. The previous owner built these with equity from a home sale and has not been able to unload ‘em for 2 years. I didn’t get a chance to talk much today but from my understanding it was a out of state investor who just wanted the he!! out of the market.
So the guy is cleaning up the outsides(insides never lived in) and the neighbors ask…”Oh,new owner,what did ya pay ?”. Guy tells em 100k. He mentioned the neighbors looked ready to kill…
HOLYYYYYYYYYYYYYYYYYYCRA……………………
Its a gonna crash hard here in Florida….
Chris
P.S.-At the high point these would have been 180k plus homes.
When this chump is speculating in RE and selling for a $100k gain he is telling everybody how smart he is. But when these condo-closets sell for less than $100k (that day is not that far off) it is not fair.
These RE speculators are getting a lesson on “intrinsic value” of aging roofing materials, a/c compressors, and carpeting. They will gain a full understanding of the concept once they wait for 20-25 years of wage inflation (in FL, of all places!) to get out “at break-even”. If we get deflation then some will die of old age in their dumps.
Got 10% down?
‘ Victoria Toher said the developer went back on their word, “They promised us they were not going to go below market value.” ‘
Psst, Victoria, they didn’t. That new price IS market value. Right now. Would you like some popcorn Vickie?
What the hell is a “townhome”? I thought they were called townHOUSES.
LMAO!
“Bruce Sexton, another San Simeon homeowner who closed on his house in October… - “I don’t think they have loyalty to the people who purchased early.”"
What planet these morons live on? “Loyalty” to buyer? “Fair market price” should be determined by what a FB overpaid instead of by current market?
UFB!
They live on the planet “RE Always Goes Up- RE is Always a Good Investment NO MATTER HOW HIGH YOU BUY!!!”. Pretty funny.
Also pretty cagey of that builder to promise the buyer they would “never sell under ‘market value’”. Brilliant! Kudos to him and a big “Gottcha Sucker!” to that fool buyer at the top.
I cannot wait for regular to people to start understanding the RE market again. But it’s gonna take a while. The NAR and lenders did a whale of a snowjob on people with their disinformation campaign of the past 10 years. We’ve got a whole generation of people who’ve never seen RE go anywhere BUT up! Don’t know what the older generations excuse is. Just stupid and gullible I guess.
“You’ve got to be kidding me, that’s not fair.”
Ah! The whine of the spoiled brat! Now perhaps if you try lying on the floor and kick and scream it will be okay, if not call mommy.
Greg be OK when him get his blankie.
Greg, take a deep breath and repeat after me, “It’s just a flesh wound!”
http://www.toyvault.com/montypython/Black%20Knight%20-%20Large.jpg
LMFAO!
Here’s another money quote
Bruce Sexton, another San Simeon homeowner who closed on his house in October is not convinced, “I don’t think they have loyalty to the people who purchased early. They’re just trying to dump the houses and get what they can.”
Uh, earth to moonbeam - there’s a word for that. It’s called “business.”
But the NAR told Bruce that “real estate never goes down”?
I think he might be “priced in forever”.
“Priced in forever”
Good one ! New NAR slogan
Exactly. I don’t know what prospective buyers expect from homebuilders. They really can’t make any promises, they gotta do what they gotta do.
Meanwhile, what in God’s name is Centex doing? While other homebuilders are scaling back, unloading land and auctioning property, Centex is building like there’s no tomorrow. They’ve got one massive development going in SouthShore Tampa Bay (Ruskin, Florida) that they just broke ground on a couple of months ago. Cobradriver mentioned one in Port Charlotte or Sarasota. And I think I read about another one in some other state. I know builders have to build once they’ve gotten all the financing, but this is ridiculous. What do they do when they really can’t sell? BK and walk away?
In 2000, builders built and buyers bought and there was a healthy profit margin. If prices tripled, builders build and make out like bandits. When prices drop in to half of peak, builder can still build and make a profit. Sheeple are screwed, but what does the builder care, he builds houses for a living. Once it’s sold, he builds another. He’s at an advantage in that he can sell the next one for less (profitably) than the underwater FB can sell there house for.
NOVA, I get that. But the builder would have to sell at least some units to make a profit and I don’t see even that happening in this area. There are already so many half-empty developments here, with desperate sign spinners out in force on the weekends. The new high school that was recently built looks deserted even during school hours. They are building for families, and those are moving away from the area. They were the wrong demographic for this area to begin with. If it was some massive retirement complex like Sun City Center, I could understand it, MAYBE. Heck, even rentals go begging around here, although people haven’t gotten real yet on rental rates.
I’m really majorly pissed what they’ve done to this area.
I had a meeting with a homebuilder in Phoenix yesterday and they said three things.
1) All property is being re-engineered for smaller lots and smaller houses.
2) 90% of their contracts in 2006 were dropped at the last minute by people who couldn’t see their current house.
3) They “hope” that the bottom comes in 2008.
Yea right, we all have to hope for something.
Lip:
Those houses must have been pretty small to begin with if people couldn’t even SEE them.
Oh yeah. Here’s an observation I’ve been meaning to mention. We used to hear nonstop about “expected” prices, as in “The NAR expects house prices to go up forever”. Now we keep hearing about “hoped for” prices, as in “The NAR hopes that house prices stop going down soon”.
Interesting …
Big V,
Sorry, “Sell them”
Yes, the NAR, the home builders, the subcontractors, the people with toxic loans, my wife, and even myself want the prices to stop going down. But this just starting!!!
I’ve talked to a lot of contractors this year and they’re all “hoping”.
One little chink in the armer though - many of the built houses *don’t* sell - for a long time, resulting in carrying costs that hit the bottom line. Thus CTX’s recent foray into negative net income in Q4 ‘06. They were positive in Q1, but I doubt that’ll continue.
palmetto,
The one i mentioned was exit 179/I75. Actually North Port,which is in Sarasota county. Yep,they are going like gangbusters.
http://www.centexhomes.com/Sarasota/?dd=FL
Location 7/8/9/10. Toledo Blade Blvd.
See my above post about the guy i work with destroying SFH comps in North Port….
Chris
Funny, my name is chris and i am a cobra driver as well, 03 black convertible vintage.
I have a Unique Motorcars(Gadsden,Al) Shelby 427 Cobra replica. I built it about 7 years ago.
Chris
I hope they want to live there for a long while!
A report from the field in Orlando. I had two appraisal assignments yesterday. The first was an upscale home in a golf community a few miles north of the city.
Home sold last year for $429,000 and I was meeting the group who was promoting a short sale. The owner had a piggyback second for $100,000 to a regional lender. The shortsale guy offered them $1000 to clear out of the deal. The lender said no. He said, “you have no standing in the real estate as you are a second. Just go after the borrower.” Thing is, the husband never signed the note.
Short sale offer for this 2100 sf home, and a nice one, $195,000.
The second was a real FB who told me he and his wife have been served on all 4 houses they own. He asked me what I would do. I said, “punt”.
He also said he was meeting with a lawyer next week to fight the foreclosures on the basis that the lender had lost copies of the closing documents including the note. He said the lender was asking the judge to do a court ordered reconstruction of the closing paperwork.
The common thread is this. Both 30 somethings looking for a quick flip. Neither making payments and each had a connection in their family with the brokers that did the paperwork and each magically had issues with regard to the paper trail.
How prevalent this is I don’t know but the courts could be tied up with this action for many many years. There is no telling how much paperwork is lost due to the constant shuffling that went on or straight out fraud.
By the way I am happy all I am doing now is fraud investigation and foreclosure work. Now this is real and getting more so by the day. A lot of people are going to be wearing those little anklettes as we do not have enough jail space. Question is, if you don’t have a house how do you do house arrest?
Car arrest? Van down by the river arrest?
Short sale offer for this 2100 sf home, and a nice one, $195,000. ??
Hmmmm….92 bucks a foot in a nice area…If I was a snowbird I would think this would be a good buy….
Heh heh heh! Car arrest–I can see Casey now, locked inside the Jetta with a dead battery, trying to figure out how to unlock the doors, with the windows opened a crack, empty Jamba Juice cups littering the floor . . .
“Question is, if you don’t have a house how do you do house arrest?”
LMAO! Put ‘em all in some failed condo complex and charge them rent.
i cannot wait unitl this action heads north
my inlwas were down in florida for the last week
looking at properties and i will share the news with them
btw they are not buying until they sell their place in jersey
so i guess they wil be not buying anytime soon
I agree. A lot of quick 50% price drops would be just the thing. Sounds like things are really picking up in FLA. Hopefully the contagionl spreads, just like the price leaps did.
50% now and then another 20-30% over the next few years would get a lot of places back to fundamentals.
Dang-Palmetto you got it-”debtors condos”
Um . . . are the closing documents on item no. 2 not recorded in the county real property records?
TC-Apparently not as the guy claims to have standing on that basis. I bet they appear before it is over. Many processors operated out of their homes and worked for lenders all over the place. It is a roadmap for fraud.
I can see a scenario wherein the reconstruction of files will be a big business as once the doors closed the files got whacked. Hell half the files backed worthless paper, why worry?
Bad news on SD economy: Continued slowdown
Silver lining: No recession worries
Economic index shows 0.1% dip
Fewer job ads blamed in regional decline
By Craig D. Rose
STAFF WRITER
June 8, 2007
A significant decline in help-wanted advertising this spring has pushed a regional economic index back into negative territory.
The University of San Diego’s Index of Leading Economic Indicators fell 0.1 percent in April, marking the 12th decline recorded over the past 13 months.
Alan Gin, the USD professor who compiles the index, said the indicator is anticipating weakness in the local economy through the balance of 2007 and possibly into 2008.
The weakness is unlikely to fall to the level of a recession, he said, but will manifest itself in higher unemployment and a continued slowdown in the housing market.
http://www.signonsandiego.com/uniontrib/20070608/news_1b8sdecon.html
Bernanke to Wall Street bulls: STAMPEDE!
Fear of inflation, Fed remarks take toll on markets
By Jeremy W. Peters
NEW YORK TIMES NEWS SERVICE
June 8, 2007
Not long ago, Wall Street trembled when it looked as if the slowing U.S. economy might be getting worse. But now, anxiety over the potential for higher inflation, driven by a strong global economy, is preoccupying investors.
Yesterday, that fear took its toll on stocks and bonds again. Share prices saw their steepest three-day decline since markets dropped around the world in February, and the interest rate on the benchmark 10-year Treasury note rose above 5 percent for the first time since last summer.
The market turmoil of recent days was a stark turnaround from the mood at the start of the week, when both the Standard & Poor’s 500-stock index and the Dow Jones industrial average hit highs. But as Wall Street all but ruled out the possibility that the Federal Reserve would lower interest rates this year, investors swiftly pulled back.
“You went from one extreme to another,” said Tobias Levkovich, chief U.S. equity strategist for Citigroup. “People were talking about the Fed having to cut rates; the economy is struggling. And all of a sudden we’ve swapped to the Fed is going to have to raise rates.”
This week, cautionary remarks from Fed officials about inflation and signs that labor costs are accelerating reignited concerns that price increases were not yet tame enough to preclude another interest rate increase.
http://www.signonsandiego.com/uniontrib/20070608/news_1n8market.html
I see this on Craigslsit here in da big Apple, the last few months my responses to my resume has been dwindling badly, and now i almost get none of my return receipts returned anymore.
I haven’t been this worried about money in 15 years.
——————————————————-
A significant decline in help-wanted advertising this spring has pushed a regional economic index back into negative territory.
On the plus side, if everyone else is having trouble, the cost of living should go down…
People still get married, though, right? I mean, my friends had a simple wedding last month, didn’t even have real instruments in the church just an amateur (I mean it) pianist, and they hired a DJ.
The dude was pretty cool–he actually sang many of the songs and had an electric base as backup, over “karaoke” tracks or radio tracks. And he was good. (This was in FL, so not your competition.)
I think the trend is not going to change, people have been dissapointed in the low quality of dj’s thanks to rap and hip hop. So only a select few will ever command the top dollar again. Mostly those who have a real business location you can go to, and years of word of mouth referrals.
With the Ipods, and easy stealing of the music, that used to be the high barrier to entry, you really had to buy at least 500-1000 records or cd’s to have a wide ranging collection to be a pro dj, Now you can buy a Hard Drive full of 25,000+ Illegal mp3’s for $300
Its sad that i booked a wedding for next month at the same amount i got 10 years ago….but at least this venue is a 3 minute drive from my apartment.
Rules ‘hiding’ trillions in debt
Liability $516,348 per U.S. household
By Dennis Cauchon
June 8 USA Today
“…The loss reflects a continued deterioration in the finances of Social Security and government retirement programs for civil servants and military personnel. The loss — equal to $11,434 per household — is more than Americans paid in income taxes in 2006….
…Bottom line: Taxpayers are now on the hook for a record $59.1 trillion in liabilities, a 2.3% increase from 2006. That amount is equal to $516,348 for every U.S. household. By comparison, U.S. households owe an average of $112,043 for mortgages, car loans, credit cards and all other debt combined.
Unfunded promises made for Medicare, Social Security and federal retirement programs account for 85% of taxpayer liabilities. State and local government retirement plans account for much of the rest.
This hidden debt is the amount taxpayers would have to pay immediately to cover government’s financial obligations. Like a mortgage, it will cost more to repay the debt over time. Every U.S. household would have to pay about $31,000 a year to do so in 75 years.”
http://tinyurl.com/2hy527
$11,434 per household in accounting adjustments more than was collected in taxes. I love FASB. I wish my bank had a policy of not returning checks if I went overdrawn and just did a little different accounting.
“Liability $516,348 per U.S. household”
Is that before or after you average the negative net value of underwater McMansions over all U.S. households?
P.S. It is easier to get rid of a pension obligation than underwater McMansion debt, and both can be eliminated with enough inflation.
“By comparison, U.S. households owe an average of $112,043 for mortgages, car loans, credit cards and all other debt combined.”
Just as the McMansion holder can declare so can The US. Both are in an excellent position to declare BK. Last one out turn off the lights.
what they don’t tell you is that americans will have incomes of $6,000,000 dollars over that period.
LOL and true, unfortunately a gal of milk will cost 1M.
Doh!
Home sales at 20-year low
Blog: If numbers hold, it will be the slowest May in agency’s 20-year history of reporting O.C. home buying.
http://tinyurl.com/lzgbg
Did builders miss first signs of housing’s slump
Register real estate reporter Jeff Collins tells us what was aid at a USC Lusk Center real estate briefing at the Shady Canyon Golf Club Thursday night …
Douglas C. Neff of IHP Capital Partners told the audience that signs of trouble in the Southern California housing market began to surface as early as 2005, but went unheeded by home builders.
Neff is president of IHP, an Irvine firm that provides financing for residential development. He said that as early as 2005, his company noticed a small but steady rise of existing homes for sale. Affordability of homes had fallen to levels not seen since 1989-90, the years the last big housing slump began. And reliance on riskier, “exotic” home loans became more common to bridge the gap between prices and what people could afford.
But because sales were brisk, new home builders continued to expand development well into 2006, Neff said. Even when cancellations began to spike in early 2006, builders believed it to be a “temporary inventory problem” caused by speculators exiting the market.
Now the first sign of recovery has appeared: New home sales have stopped dropping in Orange County, said Neff, Still, Neff said, home prices won’t rebound until 2008 or 2009.
With sales starting to stabilize — in Orange County, at least — builders who learn how to price homes right will have an opportunity to increase sales.
“We have a pricing problem,” Neff said.
In addition to the housing market, speakers focused on the retail, multifamily and office markets, all of which are in such demand that investors are driving up prices and are driving returns to historic lows, commentators said.
“There is a wall of capital” flowing into Orange County, said William Flaherty, senior vice president of marketing for Maguire Properties, which owns office buildings in downtown Los Angeles and in Irvine. “(It’s been) described as a tsunami of capital. It’s hard to say where it’s coming from. It’s coming from everywhere.”
State Realtors see ‘07 sales down 14%
http://tinyurl.com/2hxuu3
Brookfield, fund to develop land
Builder Brookfield Homes Corp. said it had formed a joint venture with the California teachers’ pension fund to develop residential land. Brookfield builds homes in California and the Washington, D.C., area.
The builder and the California State Teachers’ Retirement System will contribute equally as much as $400 million to buy, entitle and develop land for sale to residential home builders and developers, mostly in California.
Mortgage rates highest in 10 months
Mortgage giant Freddie Mac said 30-year, fixed-rate mortgages averaged 6.53% this week, up sharply from 6.42% last week and the highest in 10 months.
Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, rose to 6.22%, up from 6.12% last week. Five-year adjustable-rate mortgages averaged 6.24%, up from 6.19%. One-year adjustable mortgages rose to 5.65%, up from 5.57% last week.
These rates do not include add-on fees known as points. Thirty-year and 15-year mortgages each carried a nationwide average fee of 0.4 of a point.
Five-year adjustable mortgages carried a fee of 0.6 of a point while one-year ARMs had a fee of 0.7 of a point.
Yesterday, somebody asked about the housing market in Blackpool, England. I thought that I would post my reply here, as I was late reading the request.
For those who don’t know, Blackpool is generally considered the ‘armpit of England’ by Brits. Well, certainly, all the Brits I know. It is a beach town in the NW part of England and, to me, would resemble Atlantic City if you took the casinos out of Atlantic City.
I just returned from Blackpool this week where I was attending the annual Ballroom Dance Festival. I had the chance to look around a bit and I cannot imagine paying anything to live in that town, never mind the prices that are asked. Run-down duplexes start at 150,000 pounds and go up from there. I saw a few small flats that started at 120,000 pounds. There has been quite a bit of building going on there over the past several years, but I don’t know how you can afford anything in that town, since it seems that everyone is involved in the tourist trade.
I did not have the chance to check out any detached houses until I got to Manchester where I was staying with friends. My friends live a good 10 miles outside the center of Manchester, in a rather ordinary [by English standards] neighborhood, in one half of a duplex. The detached house across the street sold last month for 500,000 pounds. One down the street is on the market for 600,000 pounds. These two detached houses are probably ~2,500 square feet each.
Within Manchester itself, they have gone absolutely insane with the flat building. New flats are everywhere, but I did not get the chance to price any.
One morning, I was listening to the radio and I heard an ad where a return of 70% in two years was all but promised if I were to invest in some properties - in Cape Verde!
It is a beach town in the NW part of England and, to me, would resemble Atlantic City if you took the casinos out of Atlantic City.
It can’t be…AC w/o casinos is just a ghetto-by-the-sea.
Hey–it has a boardwalk. Don’t forget the boardwalk.
I wonder if Atlantic City used to be more like Ocean City before the casinos. Then again, it’s in Jersey. Naaaah.
It used to be the Queen of Resorts but I think that ended in 1926 or something.
But in the 1950s and ’60s it was a hangout for Sinatra and his buds - the 500 Club on New York Ave, man…YES
Ol’ Blue Eyes and Skinny were “like’ iss”:
“What is amazing about Sinatra’s appearances at the 500 is that he performed free of charge, doing as many as four shows a night. Skinny D’Amato says that it was because Frank loved him “like a brother,” but then Skinny seemed to feel that way about everybody he knew. And he acknowledged with pride that he knew all the important politicians in New Jersey, and every Mafia boss in the country.
As a brit I can tell you that you are correct. Armpit!
Thanks for the reply…I was curious exactly how crazy things had gotten in Britain. Blackpool is sort of like Asbury Park in Jersey…on the shore, once an ok place, now a semi-dangerous ghetto with some gentrifying money in the last few years…money I expect to wash out soon. Downmarket honkytonk is no place to be in the last years of a housing mania.
London’s Threatened Cigar Bars Go Alfresco As Smoking Ban Nears
http://www.bloomberg.com/apps/news?pid=20601093&sid=aYqplXk_4Q5I&refer=home
The New World Odor!
Hi All:
A while back, I posted a maddening e-mail from Calfifornia senator Barbara Boxer. She had sent the “we will bail out any and all FBs” letter in reply to my message urging her not to fall for any bailout tacticts. At the time, I thought that her counterpart Dianne Feinstein was simply blowing me off, but now I realize that she was taking time to fully understand the problem before replying. Dianne has retained my respect with the following letter:
Thank you for contacting me to express your concerns regarding recent reports of mortgage defaults by subprime borrowers. I appreciate the time you took to write and welcome the opportunity to respond.
I recognize that the cost of living is high in California and across the Nation, as real estate values have skyrocketed and housing affordability is at very low levels. As such, I am a strong supporter of Federal initiatives to make homeownership a reality for more Americans. The Federal government must be mindful of how lending standards impact Americans and I am concerned about the growing number of negatively amortized home loans and interest-only mortgages, which are especially popular in the areas of California where home prices are the highest. Furthermore, I believe it is important to establish clear national standards that protect consumers - particularly “nonprime” borrowers. While I do not serve on the Senate Committee on Banking, Housing, and Urban Affairs, which has jurisdiction over this matter, I will keep your comments in mind should the Senate consider legislation related to home lending.
Again, thank you for writing. If you have any further comments or questions, please do not hesitate to contact my Washington, D.C. office at (202) 224-3841. Best regards.
Sincerely yours,
Dianne Feinstein
United States Senator
I got the same email, and she *still* doesn’t understand.
Big V-
She doesn’t understand yet - or she’s obfuscating, trying to pull the wool over your eyes. Look at what she wrote:
She claims she is concerned by the lack of affordability but then says the Federal government needs to get involved.
Here’s what we know about federal government involvement in housing: All it does is form a false bottom under the housing market. She ’s either afraid of how far prices would fall without government intervention or she is too stupid to have noticed the obvious trend over the past decades of more and more government involvement in home prices.
Why do you think the gov. wants Fannie and Freddie to get involved in the subprime lending? Haven’t we already witnessed how that was a strong component in driving up market prices when it was done through the private sector? If we got rid of it all together wouldn’t that allow prices to fall?
Feinstein could give a hoot about affordability.
Hello:
I just dicovered your site through a friend and I am so greatfull I did. I live in an expensive suburb north of downton LA (Montrose/La Canada) with 0 land left to build, and home prices have maybe declined about 5-7% from their extreme peaks in 2005 and foreclosure activty is almost non existent in this area.
So I live in a condo, but I need more space for my growing family. Should I pull the trigger now by lowballing people or should I wait? I have been patiently waiting for last 24+ months.
So my question is: Do homes in such so called desirable areas with private school quality public schools go down 30-40%, or is it just the so so communities which take the beating.
I would appreciate your expert opinions since my wife has been on my case for a while now.
During the last downtown in the LA area, Beverly Hills prices went down the most of any area, approx. 50%.
The argument that affluent neighborhoods can’t lose is popular, but false.
First of all, past experience proves it to be untrue. Where I live (Silicon Valley), everyone touts Palo Alto as the place where “all the rich people live”. Supposedly, rich people are immune to losing money. However, I already know that house prices plummeted in Palo Alto around 15% during the .com bust. You can check that out on Zillow.com.
The fact is that these areas were desirable before the boom. They’re not any more desirable now, yet their prices have still skyrocketed. So logic dictates that current pricing is not based at all on desirability, rather on the conditions that created the boom: alternative lending and way-too-easy credit. Although rich people can afford to borrow more money than poor people can, it is still possible (and quite easy) for them to borrow too much money and not be able to pay it back. Whereas many poor people got in over their heads by borrowing $500K-$700K, there are quite a few middle-class folk who got in over their heads by borrowing $800k-1.3 million, and a handful of upper-middle class who did the same by taking out maybe $1-3 million. The numbers are different, but the principle is the same: overconfident borrowers borrowing funny money from short-sighted banks with the aid of shady brokers.
Right now, a lot of subprime borrowers are throwing in the towel on their $500-700K properties. The middle class folks are able to hold on a little while longer since they have some savings, but they will eventually have to capitulate as well. Oh, some of them will get lucky and get that critical promotion or inheritance, but most of them will lose a job or get a divorce or have a baby or just get a 3-5% raise at work. They might refinance once or twice, but eventually the bank will start making them pay off their loans. If their houses are valued at less than what they owe (often the case with negatively amortized loans on houses in neighborhoods with declining values), they won’t be able to refinance at all. Then they will not be able to pay their rate-adjusted mortgages including principal, and will need to sell their houses regardless of market conditions.
Of course, the richest folks will hold out longest, but when their market goes down, it will take longest to come back up, since entry to the upper class is extremely limited.
I hope my comments have been useful to you. Please try to explain this to your wife as succinctly as possible. You may be better off renting out or selling your condo and, in turn, renting a house until real estate prices have reverted to the mean.
Try to get her to read this blog as well as http://www.Patrick.net. Patrick’s blog has a really good logical argument right on the front page.
Nick-
I live in the same general area and think that prices will take longer to adjust downward than in the outlying areas like the Inland Empire and may not go down as much because the supply is still relatively limited (and will be in the future) and the area looks relatively inexpensive as compared with other more expensive desireable areas on the West Side. Finally, more affluent folks have the financial means to act economically irrational for longer than the folks who are a paycheck away from losing thier home. The prices will come down though when the speculative mentality changes. They certainly did in in the early 90’s.
For now, my suggestion would be to look at the costs of renting in a good school district (La Canada, S. Pas, San Marino, Arcadia) and compare that to the cost of owning. Be sure to include costs of maintenance for at least 1/2% of the value of the house per year.
When the cost to own equals the cost to rent, then consider buying. Also consider that the moment you buy, you are already at least 4% under water on the entire value of the house (40% of your equity if you use 10% down to buy) if you need to sell due to job change etc because of the high transaction costs. The world isn’t as stable a place as it used to be. There is a lot to be said for being able to move quickly, particularly when you have a young family.
Finally, with a young family, it is a big mistake to be a slave to an overpriced house. Your kids need their parent’s attention and could care less where you live. If you and the Mrs have to work 24/7 just to own a house and are too nervous about losing your jobs to tell the boss to get lost when he objects to your leaving early to coach the kids teams, attend the school event, etc. the kids will suffer and you will suffer when they become teenagers.
More than 2 cents, but what I would do in you position based on past experiance.
Thank you, I appreciate the input
Nick
KPBS Radio, 89.5 FM San Diego
Editor’s Roundtable
Immigration Reform, Superstore Ban, Subprime Update
Jun 08, 2007
Audio will be posted Friday afternoon.
This week, the Senate struggled to reach a compromise on an overhaul to the nation’s immigration laws. Will a comprehensive immigration reform bill ever get passed?
Also, the City Council gave final approval to a ban on “superstores” in San Diego. Should the voters decide if Wal-Mart Supercenters belong in their community?
And, a local subprime lending company agreed to be acquired by a private equity firm. Are the subprime lending woes just starting, or are the worst times behind us?
(Subprime next up if you have a chance to listen now; otherwise, catch audio file later today…)
http://www.kpbs.org/radio/editors_roundtable;id=8582
In case you don’t have time to listen to this program, I can offer a three-word summary: SUBPRIME MARKET MELTDOWN!
I’m having fun looking for bargains on FB merchandise. I made an offer on a grand piano offered by some people who are trying to sell their house for what they bought it for in 2005 - they accepted it immediately. Three years ago I couldn’t have had this piano for twice what I’m paying now. This weekend we’re going to look at a desk in a vacant for-sale house. We’ve been using an old wooden table as a desk for years. Now we can get a nice desk for next to nothing. I figure that next year will be a good year for home repair prices.
The D.C Suburb’s Northern VA numbers are out today. I always put up a chart of the monthly sales for the last 10 years to provide some context:
http://novabubblefallout.blogspot.com/
We are looking to buy west of Prince William County, VA, the last chart. With a ratio of 489 sales to 6,199 listings, I think it’s prudent to wait. There are about 450 active foreclosures in that county at present.
1500 s&p recaptured. what a surprise. so many puts there. yesterday was just a chance to buy some cheap calls so they can run it again next week.
MRIS, a real estate information service for Maryland, Washington DC, Northern Virginia, and parts of West Virginia and Pennsylvania, has updated its Monthly Real Estate Trend Indicator for this May.
Data: http://www.mris.com/reports/stats/monthly_reti.cfm
Data and Charts: http://www.recharts.com/AroundDC.htm
house rents are in a tailspin here, all those “investors” trying hard to keep afloat….
my 23yo office mate and a couple of buddies are looking at this house tonight….
11837 PYXIS CIR, RANCHO CORDOVA CA 95742 http://www.google.com/search?q=11837+PYXIS+CIR+95742
Sold on 04/28/2006 Price: $746,500 http://tinyurl.com/2bcvo2
http://www.sacrentals.com/goinside/11837-pyxis-circle
11837 Pyxis Circle - Anatolia/South Sunrise - Rancho Cordova
4bed - 3.5bath + Loft/office: $2095 - Available July
house rents are in a tailspin here, all those “investors” trying hard to keep afloat….
my 23yo office mate and a few of buddies are looking at this house tonight…. 11837 PYXIS CIR, RANCHO CORDOVA CA 95742 http://www.google.com/search?q=11837+PYXIS+CIR+95742
Sold on 04/28/2006 Price: $746,500 http://tinyurl.com/2bcvo2
http://www.sacrentals.com/goinside/11837-pyxis-circle
11837 Pyxis Circle - Anatolia/South Sunrise - Rancho Cordova
4bed - 3.5bath + Loft/office: $2095 - Available July
Great rental price, but I wouldn’t want to own it at half the price. A soulless McMansion.
You could buy my house in Texas for a third of that selling price and $100/month less PITI than the rent. I hesitate to suggest this, but perhaps the wishing prices are somewhat out of line with the rents.
I hadn’t seriously considered working in CA but now that I realize that CA businesses offer FB rental subsidies I might have to consider it. Of course, I’d just be throwing my money away renting…