There Are Going To Be Bargains And Deals
The Record reports from New Jersey. “A Hoboken developer, Remi Cos., plans to jump-start sales of its new condo development with a public auction next Sunday. The auction is occurring against a backdrop of lower demand and lower prices for condos nationwide. ‘We can sell the units quickly, and people can get a discount,’ said Remi CEO Erik A. Kaiser.”
“James Hughes, a Rutgers economist who has studied the state’s housing market, said the results of the Velocity auction will be an important indicator. ‘If they are able to auction all the units off at reasonable prices, maybe there’s demand there at specific prices. But if it falls on its face, we’re in real trouble…and we may have an oversupply of units,’ he said.”
“The minimum bids in the auction start at $295,000 for a 790-square-foot one-bedroom unit. That previously had an asking price of $450,000. A three-bedroom, three-bath, 1,549-square-foot condo has a minimum bid of $545,000, compared with an earlier asking price of $865,000. Monthly condo fees range from $347 to $680.”
“‘An auction is really letting consumers set the price,’ Kaiser said. ‘The market is going to pay what the market is going to pay. We know there are going to be bargains and deals. Why not create a new way to let the consumer tell you now what the price is going to be, rather than wait six months?’”
The Star Ledger from New Jersey. “The house in Manalapan went for more than $1 million. And that was only the first time it was sold.”
“Within days after the first deal, the same buyer and seller closed on at least two additional mortgages on the house, each time using different attorneys, title agents and banks who had no clue the property was already mortgaged to the hilt, illegally obtaining millions more in financing.”
“Mortgage fraud in New Jersey is increasing at a faster rate than anywhere else in the country. The number of complaints from financial institutions in New Jersey grew more than 208 percent last year, according to a report.”
“‘We’ve seen an increase in fraud every year since 1997,’ said Sean McCarthy, an FBI special agent who is looking at the Manalapan sale. It has apparently become the most lucrative way to rob a bank. According to McCarthy, the losses to mortgage fraud now far exceed those from counterfeit checks and other banking schemes.”
“New Jersey’s property values have been rising, making fraud more inviting. A major Camden drug dealer who was later convicted told cohorts that flipping dilapidated houses was more profitable than selling drugs, and a number of criminal gangs have been tied to illegal mortgage schemes.”
“Attorney Jaimee Sussner said she has seen complicit closing attorneys, appraisers more than willing to inflate the value of a property, and mortgage companies ready to look the other way in order to quickly close on any deal possible.”
“‘No one is looking,’ she said. ‘And there’s even less attention on high-end deals, so if you’re determined to steal, you might as well steal a lot of money.’”
The Daily News from New York. “You can forget about oceanfront views from high-rise balconies and takeout from Nathan’s Famous. Mega-developer Thor Equities, which has reportedly laid out more than $100 million so far to rejuvenate Coney Island, has given up on plans for a highly profitable residential component to its Las Vegas-style amusement park project.”
“‘Thor has believed from the beginning that the amusement and entertainment aspect of the project was the most important aspect of the project,’ Thor spokesman Lee Silberstein said.”
“Now, the plan will have no residential component and no 50-story tower, as had been proposed, Silberstein said. ‘It’s significantly smaller,’ Silberstein said of the overall project. He refused to divulge specifics of a revised plan or to say how Thor would profit without the sale of luxury condos.”
The Record Online from New York. “You don’t need these eye-popping numbers to know young people are fleeing our region: Between 1990 and 2000, the number of residents ages 20-34 in Orange, Ulster and Sullivan counties dropped by 25,000 while the rest of the population grew by 51,000.”
“You knew things were bad before last week’s Sunday Record story, ‘Young, Gifted and Not Coming Back.’ You watched your sons, daughters and neighbors leave for better jobs, cheaper housing and lower taxes.”
“‘I want to kiss goodbye overpriced bills from Central Hudson, overinflated gas prices, insurance, taxes and living expenses,’ wrote one resident who’s moving to South Carolina. ‘I’ll be able to buy a house for half of what mine sells for, and I’ll invest the rest to live off the dividends, along with working. New York — thanks for kicking us (out).’”
The Baltimore Sun from Maryland. “Maryland’s number of borrowers in trouble spiked sharply in the first three months of the year. The share of loans in the foreclosure process in the state rose nearly 30 percent compared with the first quarter of last year, according to a Mortgage Bankers Association survey. The share of borrowers behind on their payments rose nearly 20 percent.”
“The increase in loans in the foreclosure process here was the largest in nearly 10 years.”
“Delinquencies and foreclosures dropped during the housing boom. But more borrowers began to fall behind as boom turned to slump. The final three months of 2006 was the first time since early 2002, in the aftermath of the last recession, that the inventory of foreclosures increased year over year.”
“‘I think there is a clear indication that the number of foreclosures is only going to increase,’ said Phillip R. Robinson, executive director of a Baltimore legal-help group.”
“Borrowers in the state were behind on about 36,700 mortgages in the first three months of the year. That’s about 3.5 percent of all mortgages.”
CNBC on Maryland. “When the tech bubble went bust in 2000, Maryland homeowner Rick Boardman took his money out of the stock market and put it in something he thought would be safer, real estate. ‘We thought it was a good investment, but also something we could enjoy and might change our lifestyle too,’ says Boardman.”
“He and his wife bought 20 acres of valuable waterfront property in Maryland confident it would turn an easy profit. Boardman remembers the summer of 200 as a time when ‘everything was just boom, boom, boom, especially on the eastern shore.’”
“Boardman built two homes; one to sell, which would finance the other, his dream home. But the $2 million home has been on the market for over a year, and Boardman can’t make the mortgage payments anymore. Work on his dream home stopped.”
“‘What was our dream has become a financial nightmare. Our goal now is just to get out with something to pay off the debt,’ says Boardman. ‘We’ve come to the absolute end of the road.’”
The minimum bids in the auction start at $295,000 for a 790-square-foot one-bedroom unit. That previously had an asking price of $450,000. A three-bedroom, three-bath, 1,549-square-foot condo has a minimum bid of $545,000, compared with an earlier asking price of $865,000. Monthly condo fees range from $347 to $680.”
Aren’t these starting bids too high? If they want the market to determine the prices why start with such high ones? I fervently hope that the auction fails badly.
I agree, these minimum bids are neither bargains or deals. I suspect this is a test of current market conditions by the developer rather than a serious attempt to move their condo’s. Hopefully they will get a clear message from potential buyers that the days of selling overpriced junk are done.
I believe it is a bunch like the Comp USA liquidation “sale”. I went in there and I was looking around and everything was 30% off, unfortunately the price was a hefty 50% over retail in most cases. I bought a pack of Orbits gum on the way out, it was $1.40 with 20% off $1.12 at the market $1. This strategy is to dupe the stupid with percentages off of retail or list or in this case arbitrary market prices established by people working for the industry…how can this not be a deal?
These auctions are a farce in most cases, the auctions where the neighbors are screaming “IT’S NOT FAIR!!” would be the more accurate assessments of pricing. If I don’t see neighbors crying and screaming, probably not a real auction…..ohh and if they are in tuxedos and playing upbeat music and looks like a religious revival….run…RUN!
I cannot speak if these prices are fair or not.
If they sell: The market has a new (lower) price.
If the auction fails, that that Rutgers economist noted, “But if it falls on its face, we’re in real trouble”.
Well, I wouldn’t say trouble… I’d say a return to a rational market.
Got popcorn?
Neil
How can auctions with minimum bids be representative of a free market? It is like a stock market with minimum stock prices below which you can’t buy any stock no matter how low the market falls. Wake up buyers, this is another rigged game you can’t win. You are better off bidding in the open market or auctions without minimum bids. Go on, write that down in stone, or better still on a brick!
How is it rigged? If you don’t like the minimum bid, you are free not to bid. The reason for a minimum bid is to create a floor where the seller MUST sell, thereby creating a more orderly auction.
Stock markets work very differently from auctions…
As a matter of commercial principle I will not bid at an auction where the seller has a decided advantage in setting a minimum bid may be above prevailing market prices. That is why I think it’s rigged but I agree with you that one doesn’t have to play a game in which the dice may be loaded against you, unless of course money is no object.
“James Hughes, a Rutgers economist who has studied the state’s housing market, said the results of the Velocity auction will be an important indicator.”
Kick me hard! Mr. Rutger economist, you won’t really know the results of the auction to the winning bidders actually qualify for a loan, and the deed changes title. Why should the drop out from winning bidder to actually closing run any different that the 33%
reported by KB Homes, Toll Bros, Pulte.
Can I remind Ben’s Bloggers that a auction is just one more marketing scheme, and a low ball bid directly to the builder can have better results since it is kept quiet. I remeber during the RTC auction days, many properties were pulled from the auction
because of a prior sale.
you’re right. these stupid auctions are just marketing schemes…when your spam box is full of auction emails, you know it’s true.
what’s next? lotteries? buy a $500 ticket, you might win a house!
Didn’t Mr. Magoo graduate from Rutgers?
Yes. Rutgers has many great alumni, not that I’m biased or anything.
I take the light rail, by velocity everyday and those prices are ridiculous. It’s next to public housing! can’t wait to see this auction fall flat on its face.
The location is not great: yes near light rail, but so what? it’s a pain to get into manhattan. also, to get to any restaurants it’s at least 10 blocks to get to the main strip and no parking there so good luck doing that walk when it is cold, or when it is raining or when it is too hot.
fall flat on its face…this auction will, and then it will be blamed on greedy buyers looking for a bargain.
“Aren’t these starting bids too high?”
I was thinking the same thing. They’re hoping that $295 gets bid up to $400 so they don’ really take a hit.
Yeah it will get “bid up” to $400K; wink wink no what I mean?
Talking about auction bids, check this out:
http://findarticles.com/p/articles/mi_pjus/is_199809/ai_73799522
Names sound like 25 terrorists.
$350-$370 sq ft. Pretty ridiculous. No wonder they didn’t sell at the even higher prices. Probably cost them $50 sf to build.
$300,000 for a one-bedroom apartment in Hoboken, NJ?
Bwahahahahaha
Hey,
You know, Frank Sinatra was born in Hoboken. They aren’t making anymore Frank Sinatras….And everybody wants to live where Frank Sinatra lived. What are the 3 most important things about real estate? Sinatra, Sinatra, Sinatra.
That’s exactly what I thought. I never realized that Hoboken was such a happening place.
But DE VIWZ DE VEWZ I GOTZ me a BOOtiful VIEW of dabeeg APPLE!
I guess thats worth and extra $150K.
UH OH! these on-sale kondoze face the New Jersey Turnpike.
yes, as scary as that sounds…Hoboken is the place to be if you can’t afford NYC rent.
yes, as scary as that sounds…Hoboken is the place to be if you can’t afford NYC rent. It will go to the highest bidder there, so the results should be interesting.
“James Hughes, a Rutgers economist who has studied the state’s housing market, said the results of the Velocity auction will be an important indicator. ‘If they are able to auction all the units off at reasonable prices, maybe there’s demand there at specific prices. But if it falls on its face, we’re in real trouble…and we may have an oversupply of units,’ he said.”
If academic economists notice an oversupply of units, then we’re in real trouble.
how many years will these folks get
we’ll need lots of road gangs
, illegally obtaining millions more in financing.”
Robbery at the point of a pen has always been more lucrative than robbery at the point of a gun. Less risk, usually lighter sentences- what’s not to like?
“‘What was our dream has become a financial nightmare. Our goal now is just to get out with something to pay off the debt,’ says Boardman. ‘We’ve come to the absolute end of the road.”
Too bad we don’t get a video of this, the expression on the FB’s face would probably be priceless. No schmuck, your final roads ends @ BK court. Too bad the FB never learned the importance of diversification…before now, that is.
These people sound like day traders. Since when did a house become anything other than a place to live and raise a family?
Why the hating on day traders? I agree, a lot of schmucks tried that and failed but day trading is a decent way to work for yourself (or someone else as a prop trader). Idiots like the guy in this story aren’t comparable to good day traders.
trading is a decent way to work for yourself
Nothing personal, tx, but shuffling money around does not work make. I know it’s the American way, but it seems to me htat trading is just gambling: some people win, some people lose, but what does it contribute to the country?
What does feng shui or male chest waxing contribute to America? Your point is?
IMHO, txchick, you are pointing out a larger problem with our society; I agree with both you and Mikey.
Seems like everyone is a day trader when the market is riseing.It is very difficult to make money on a consistent basis through good and bad times.I kind of think it is great that someone can employ themselves by outsmarting the big boys on wall street. I think some people work all day for the man and spend half their days surfing the net and wasteing time.
look at it this way… if housing had true day traders, the pricing would be much more efficient and would correct faster.
so you could argue that the day traders’ collective service to mankind is market efficiency.
Because day traders are just that. They create no real investment for the companies that they are “investing in” but speculative skiming.
They are no better than equity locusts in the realestate market.
I would never use the word “day trading” with the word “work” in the same sentence as anyone that thinks day trading is work has never done an honest days work in their lives.
I am waiting for the new Discovery series to start to replace the Texas Hold’em craze called “Day traders” because it is no better than gambling. No fundamentals involved, no wealth creation, no job creation, just leaching and of the system.
What’s the difference between day trading and buying stock for the long term after the IPO?
“What’s the difference between day trading and buying stock for the long term after the IPO?”
Long term stock investment provides real money for a company to build product - i.e. it’s a loan which is later paid back when the stock is sold.
Giving loans on a day-to-day basis doesn’t provide any significant benefit, because the work to shuffle the papers greatly outweighs the benefit provided by the loan.
Geez,
Lay off txchick. Traders make the market, providing the liquidity that allows you to sell your shares when you choose. It’s capitalism at work.
You act like she’s using borrowed money, acquired from some numbskull banks using a NINJA loan.She’s putting her own capital at risk in the market, looking for pricing weakness, (since she prefers bear markets), which adds to the efficiency of the markets. Alexander Hamilton would applaud, and so would Ben Franklin.
“Long term stock investment provides real money for a company to build product - i.e. it’s a loan which is later paid back when the stock is sold.”
Sorry Packman,
your mistake. Ownership of shares constitutes partial ownership of the company. It is not debt or a loan. A company may issue debt such as bonds, at a stated rate of interest, for a stated period of time, which will later be repaid, all things going well, in full at the end of the stated term.
“Lay off txchick. Traders make the market, providing the liquidity that allows you to sell your shares when you choose. It’s capitalism at work.
You act like she’s using borrowed money, acquired from some numbskull banks using a NINJA loan.She’s putting her own capital at risk in the market, looking for pricing weakness, (since she prefers bear markets), which adds to the efficiency of the markets. Alexander Hamilton would applaud, and so would Ben Franklin.”
I have no problem with day trading, and certainly not with the open market system - I’m as open market as you get. I view day trading kind of like as watching TV - something you yourself can get benefit from, but I wouldn’t say it’s providing a benefit to society. I still fail to see how it makes the markets more efficient, in terms of productivity. Yes it does help provide a narrower range of what might be considered a “correct” price of some stock, but why are is that assumed to be beneficial? It’s still just as physically easy for me to buy and sell shares via TD, etrade, or whatever, as it was before - the order just may not be filled quite as fast. If I place an order to buy at $40, and the stock stays stuck at $41 for an extra 20 minutes or so, it’s not a big deal. If the stuck ends up not going down to $40 and instead bounces back up to $50 and my order never gets filled, then that’s bad for me, but good for the person who otherwise would have sold for $40. Meanwhile, I learn my lesson that the company was actually worth more than I thought it was.
“Sorry Packman,
your mistake. Ownership of shares constitutes partial ownership of the company. It is not debt or a loan. A company may issue debt such as bonds, at a stated rate of interest, for a stated period of time, which will later be repaid, all things going well, in full at the end of the stated term.”
While it’s true that ownership of shares of a company are not technically a loan, as bonds are, I would submit that the effect is the same. The only difference is that bonds have a known termination date and gain rate and stock shares do not. Both are taking capital and investing it into the company with the expectation of return of value based on the growth of the company. That’s the principle I was talking about, and that’s why companies go public - to get extra money to grow that they otherwise wouldn’t have. Otherwise they’d stay private.
I’ve done my own day trading from time to time - per se. Not a lot, but some. I’ve got several outstanding shorts of homebuilders and lenders. The reason I’ve done this is my own pesonal gain (and my family’s)- I don’t view it as any benefit to society.
While it’s true that ownership of shares of a company are not technically a loan, as bonds are, I would submit that the effect is the same
Dead wrong. A company has a contractual obligation to bondholders to pay interest and repay the principal, and if it doesn’t, the boldholders can force the company into bankruptcy.
Companies don’t owe shareholders anything, because shareholders are the company.
Shares and bonds are both ways to raise capital, but that’s where the similarity ends.
Day traders, commodity traders, and short term speculators are an essential part of the markets they trade. They provide liquidity and narrow the spreads between bid and ask prices. This is Econ 101 stuff.
Right. It’s useless to argue with people who don’t understand the process.
I suppose if you asked a Realtor or mortgage broker, they would say their tag line “helping make the American Dream a possibility”.
Does anyone actually have any documented proof that daytrading actually contributes anything to an economy or market other than some overused tagline?
Day traders, commodity traders, and short term speculators are an essential part of the markets they trade.
Still doesn’t make them produce anything - no jobs, no product, nada. Yeah, I worked today - I put $1000 on red and it came up. Whew, gotta take a shower after “earning” all that money.
“They provide liquidity and narrow the spreads between bid and ask prices. ”
I fail to see the benefit in either of these.
Relating back to the original subject - this is what has gotten us into the housing bubble - too much liquidity, and too much easy low-cost credit - i.e. “no-cost” closings are the real estate equivalent of narrow bid/ask spreads and low-commission stock trades.
If it’s more painful to make trades, then people tend to think a lot more before they make a trade, which IMO is a good thing.
“Right. It’s useless to argue with people who don’t understand the process”
The process is the same as the housing flipper. This is what caused the problem in the first place. There is no real added value. It’s hypocrisy to scoff at the housing flipper when you are doing the same with a different vehicle.
Oh, sorry. I forgot that stocks are a necessity of daily life and that people live in them.
“Oh, sorry. I forgot that stocks are a necessity of daily life and that people live in them.”
Thats a non sequitur so no response from here.
The difference between a “day trader” and Wall street is scale. I don’t know why people are getting pissy about day traders putting their own equity on the line whereas it is ok for a big monster firm such as Morgan Stanley to do it and get nudge-nudge wink-wink help from the big power players.
The difference between Housing bubble and trading is that it is more difficult for invidual to defraud on such as a scale. Even if you trade on margin, you have to settle at some time. Secondly, unlike Housing, the trader pays capital gains and doesn’t get any tax payer help.
It is actually quite a stressfull way to earn money.
Just because other people or firms are doing it doesn’t make it “work,” which, I believe is the beef that people have here. People make money by going to the track or playing poker - these people put their equity at risk, too, but I don’t have much respect for their way of life. I would imagine that being a drug dealer is a stressful way to earn money, as well, but I don’t have much respect for those folks either.
Feh. I think most of what passes for “work” or commerce in this country is pretty much a joke. I really don’t care what anyone thinks. In the end, we’re all dead.
As Bertrand Russell noted, there is nothing inherently noble about moving bits of matter around.
“They provide liquidity and narrow the spreads between bid and ask prices. ”
“I fail to see the benefit in either of these.”
Have you ever actually owned any stocks?
If you have owned stocks, were you able to sell them on the day that you wished? That’s liquidity in the markets at work.
As for narrowing the spreads, are you in favor of paying the highest possible price for a share…or would you like a narrow spread to give you the best price?
See response above. Yes I have owned, and do own, tons of stocks.
What percentage of stock transactions would you say are day traders? Serious question, not intending to bait.
Unless it’s around 99.5%, I can’t believe that it would be a problem trading stock when I want. The principle is that I simply up my asking price until the order is filled, or vice versa a seller lowers their selling price until the order is filled.
If I had to physically drive to Wall St. and exchange paper with someone that would be another matter, and having “middlemen” do the work for me does provide a benefit. But those days passed about 120 years ago with the advent of the telephone.
Didn’t really address this point:
“As for narrowing the spreads, are you in favor of paying the highest possible price for a share…or would you like a narrow spread to give you the best price?”
It works both ways though, and balances out. If I pay .50 more for a share than I otherwise would that means someone else gets paid .50 more for the same share. Conversely if I pay .50 less for a share than I otherwise would (due to the seller lowering their ask before I raise my bid), then I benefit and they lose. Either way it balances out. So no - I still don’t see the benefit to narrower spreads, especially given that the narrowness caused by day trading I’m sure is quite small.
In the interest of not offending though - I’d like to reiterate that I have no problem with day trading - I just don’t think it provides any benefit to society.
“From dwkunkel…
Day traders, commodity traders, and short term speculators are an essential part of the markets they trade. They provide liquidity and narrow the spreads between bid and ask prices. This is Econ 101 stuff. ”
Enough said. If you don’t think capitalism benefits society, that’s another discussion, outside the purview of this blog.
Since when did a house become more than a place to live….hmmm…I think if you said that out loud in OC an angry mob would rush you from the Starbucks and tar and feather you and run you out to Riverside on a rail.
Many historians have noted that the end of empires (British, Dutch, Spanish) and collapse of ‘world orders’ are accompanied by a shift in the focus of the population from production (manufacturing, trade, farming) to speculation and finance. Unfortunately, an economy based on finance gives the illusion of wealth and the certainty of collapse.
What I want to know is when the summer of “200″ really was - if it was 2000 or 2001 (they lead with him pulling the money out of stocks in 2000), then I can barely comprehend how this guy can’t turn a profit unless he’s just being very greedy on the selling price, on the other hand, if it was 2005…
Exactly. Curiously, the original article even has the ‘200′ misprint. How convenient.
My guess is that the poor putz pulled his money out of the market well after he’d lost most of it in tech stocks. Only sometime later did he buy into real estate — once it was heading into full bubble mode. Late to the game. Ouch.
More data on this guy Boardman’s investment to come… I’ll start a whole new comment at the bottom.
I was actually surprised that they’re taking a bath on property they bought back in 2000. But, they were a little SLOW building the houses, no? Same problem with the spec house I’m living in this summer: if it had been finished in 2004, the builder might have gotten his price. Now all my landlord can do is keep lowering the price and hope to catch up with the declining demand before he’s underwater. Speculation requires agility or a crash helmet. Maybe both.
“‘I want to kiss goodbye overpriced bills from Central Hudson, overinflated gas prices, insurance, taxes and living expenses,’ wrote one resident who’s moving to South Carolina. ‘I’ll be able to buy a house for half of what mine sells for, and I’ll invest the rest to live off the dividends, along with working. New York — thanks for kicking us (out).’”
Feel the same about Ca.
Oh well, I guess anyone smart enough to read this blog is invited to move here to SC. I beg of you…Please, please, don’t mention your plans to your idiot neighbors…
Just don’t expect to make NY money in SC.
Wages and living expenses seem to even out most places. CA and FL excluded. Their scales are upside down.
Wages and living expenses even out, and that lower income often puts you in a lower tax bracket. If that’s the case, you actually come out ahead.
Florida, and to a certain extent California, are special cases IMO.
Florida mostly because it’s driven by tourist $$ - thus the state itself brings in lots of money relative to the goods provided to the rest of the country, and relative to the wages given to the workers. Witness places like the Caribbean islands for extreme examples. That is - a high percentage of the $$ that are spent there are not spent by the people living there.
California also has a huge tourism industry, which contributes to its discrepancy. Also however is just that California is generally a more desirable place to live than just about any other place in the U.S., due to mild climate, scenery etc. Thus law of supply and demand dictates higher prices. As a result prices of real estate are higher than average when compared to wages, because a smaller percentage of the population lives in their own homes. Manhattan is a microcosm of the same principle.
I have said this for 15 years, everything you buy cost the same in Charleston as in NYC but you get paid 1/2 the wages…So his plan is quite good make the $$$ here and go there OWNING everything.
Of course when (i left a year Before Hugo…whew) i rented a nice 2 bedroom condo in a community which had a boat dock and an olympic size pool which hardly used during the day, since there were very few kids in the 200+ unit complex…i was paying $345 mo and i had a roommate….
“New Jersey’s property values have been rising, making fraud more inviting. A major Camden drug dealer who was later convicted told cohorts that flipping dilapidated houses was more profitable than selling drugs, and a number of criminal gangs have been tied to illegal mortgage schemes.”
We are more sophisticated in California. They actually purchase the house then convert it to grow pot.
Well, actually, the mortgaage schemes are way more sophisticated:
1) You don’t have to pay for electricity
2) You probably won’t go to jail
3) You get the money WAY faster
4) You can do multiple scams at the same time
5) You don’t have to sell anything
5) You don’t have to deal with slime balls (well, forget that one)
Something omitted from the Hoboken article: All of those units were SOLD at pre-construction pricing. The 40 that are up for auction were cancelled due to construction delays. Yes, the developer put a delay clause in the contract and only 40 buyers decided to opt out. I’m more surprised by the 80 who DIDN’T cancel. And yeah, it’s in a cr*ppy neighborhood, but the NYC train is right there.
The Next Big Thing in housing - the “minihouse” - 510 square feet for 230K.
Go to homesdatabase.com
and type in this MLS number: BC6446948
That’s a shed I think. With siding.
Very odd. If it’s the land that’s expensive, the structure is almost an incidental component of the price. I would have thought that perhaps they could have made the house larger than a studio apartment for, percentage-wise, very little extra cash.
why not make them like a mushroom on 1/10 of an acre
Mobile toughsheds?
Regarding the above, note that the lot acreage is zero, and the description shows that it’s “nestled in an enclave of 11 historic mill homes on 5 private acres of common ground.” So what you get is a shed and no private ownership of land. Not a good deal, I would say.
How about a 530-sqft condo for $360,000.
Central Coast MLS #122548.
Near the ocean, admittedly, but no mention of waterview.
And not marketed as “teardown,” as it’s in a condo bldg.
They’re selling 250+sqft condos in Chicago for $150,000. You can barely turn around in the places.
My living room is 62 sf bigger than that, and it’s not that big.
Welcome to Tokyo!
There is a 30 year old 600 Square Foot condo for sale down the street from my apartment that is going for almost 400k.
Wife and I took a look at it about 6 months ago for grins, they managed to squeeze three bedrooms into it.
It still hasn’t sold.
Tokyo is in the middle of yet another real-estate bubble. Didn’t learn the last time…..
Why don’t you do it like this?
http://www.homesdatabase.com/BC6446948
Homesdatabase doesn’t show you property addresses until you select an agent to work with on the website.
CNBC on Maryland. “When the tech bubble went bust in 2000, Maryland homeowner Rick Boardman took his money out of the stock market and put it in something he thought would be safer, real estate. ‘We thought it was a good investment, but also something we could enjoy and might change our lifestyle too,’ says Boardman.”
“‘What was our dream has become a financial nightmare. Our goal now is just to get out with something to pay off the debt,’ says Boardman. ‘We’ve come to the absolute end of the road.’”
Twice they jumped on the Gravey Train just as the wheels were about to fall off! Bad timing, don’tchaknow?
It wasn’t his timing that was bad, it was his greed to have a “Dream home” paid for by someone else. He had no business building a $2 million dollar house when he wasn’t a deep pocketed experienced developer. And wasting 20 acres of prime real estate on only 2 houses ? Very bad business sense.
He bought in 2000 and *still* managed to lose money? LOLz…
I thought we were supposed to not worry be happy”
” Stocks flat as subprime worries offset takeovers
Mon 10:26AM ET - Reuters
“‘An auction is really letting consumers set the price,’ Kaiser said.
Sorry there Mr. Kaiser, setting a minium bid does not a true auction make!
I’ve seen a few news stories like this recently but not one has taken it to the logical conclusion: that this has happened and his happening everywhere. In Philadelphia, NYC, Rhode Island. As soon as people realized they couldn’t sell honestly they looked for an other way and found it.
I guess people shouldn’t feel bad about losing money on real estate. After all “everybody is doing it”.
I can’t help but notice all the people who hate high cost of loving fleeing to areas that make better economic sense to their personal situation.
Sort of like what business does. And has been doing for decades now.
Yet business gets crucified for their economic decisions while individuals are somehow exempt from making rational & logical choices.
I’m no fan of outsourcing and wish American business would try to make it work with less of a price gouging profit in the homeland, but boy howdy when I read all the tales of ” moving to N. Carolina to save money “, then hear from big SUV buying, boat owning, huge mortgage paying people crying in their wheaties about the jobs going offshore .,. well .. seems just a tad hypocritical.
make it work w/o profit
that’s a toughy
Your analogy is flawed.
If you live in New York, when you spend money locally you’re spending it in America. If you move to South Carolina, you’re still spending in America. When you spend money in your own community and your own country, it’s more likely to be spent again inside your community and/or country, raising the standard of living for Americans.
Jobs outsourced to Bombay and Shanghai… that money leaves our society completely.
I don’t know where Bombay is, perhaps you meant Mumbai.
It’ll always be Bombay to me.
If people are moving to other areas of the US where they are making a similar wage, how is this comparable to businesses offshoring to countries where they pay workers pennies on the dollar? People aren’t moving to India; they’re moving to South Carolina.
Err ” high cost of loving ” . … I guess that would go along with the ” high cost of living ” / !!
“The market is going to pay what the market is going to pay.”
Then why set a minimum? Scared of what the “Market is going to pay”?
“‘I want to kiss goodbye overpriced bills from Central Hudson, overinflated gas prices, insurance, taxes and living expenses,’ wrote one resident who’s moving to South Carolina.
Crap, here comes another one to our State. One more reason why our home prices will not correct anytime soon. These folks think they are cheap, but for the average South Carolinian they are not!
True,
States with reasonable lifestyles are going to see a huge influx of “Housing bubble refugees.” That is, until the markets get so bad that the refugees have enough hope and stick around. Before that point, we get to the “throw the keys on the roof and move” stage. That stage probably won’t happen until 2008. It might not happen until 2009…
If it happens this year en mass anywhere but Detroit and Florida… I’m scared. (Some in Sacramento, Pheonix, Palmdale/Lancaster, etc. Its “en mass” that would worry me, not a thousand or so in each market…)
Got popcorn?
Neil
I heard a developer in FL about 20 yrs ago say how he loved NYers. They sell fell 400K move to FL and pay 250K and think they are getting a deal becauseit is less than in NY, not realizing they are paying 2X what a FLer would pay. Same now in SC and NC. Yankees moving to Containment Area for Relocated Yankees (Cary, NC near raleigh) pay twice what would pay just on the other side of the traingle. Locals getting priced out because Northeners think they are getting a deal.
Native NCian, just moved back from San Diego to Charlotte, and I’ve been trying to figure out the market here ever since. I’m a renter, because in my area, it is cheaper for me to rent than buy. In some ways it seems NC is just behind the curve, that as long as people can sell their houses elsewhere they’ll keep moving here, but will trickle off once they can’t. But will we get an influx of previous “owners” turned renters that have turned their keys into the bank and still see NC as the promised land of cheap stuff? Or people who have sold at a loss elsewhere but can still afford it here? Supposedly it’s an affordable market here, but I have a feeling that $150,000 median price is articially low due to homes in neighborhoods where I wouldn’t go alone. During the day. I can’t embrace the idea of paying $400k for a condo in downtown Charlotte or $600k for a 3/1 bungalow just outside. Has my time in CA caused me to be so jaded that I think real estate always goes down? I had no idea there are so many fellow Carolinians here- would love to hear any thoughts.
Bingo on your observation about Charlotte. (Used to live there) Everyone wants to live between Park Rd. and Providence Rd., especially north of SouthPark mall (Or maybe up at Lake Norman!). Most of the other areas have major drawbacks. I see the median price city-wide and laugh, because an smart, observant person knows that 200K is not the typical price of what you can tolerate, more like 500K plus.
I would certainly rent in that town. Prices might be peaking right now…
Double bingo!! It’s all that and then some, Charlotte, Myrtle Beach, Charleston, etc is the new FL. People moving to NC/SC for a better quality of life and lower cost of living. Just a matter of time til the bubble pops and just like FL (ex NYer) and southern PA (ex MDers) and southern NH (ex MAers) the lazy laid back days will soon be a thing of the past.
Or the flip side - people come to California and believe their realtor who tells them this is the way things are -you have to overbid, etc,etc - when they weren’t like this at all before the invasion from the east coast.
Prices were just settling back to normal when the whole exotic mortgage thing set everything off again. There isn’t anything holding up California prices except hot air.
“‘We’ve seen an increase in fraud every year since 1997,’ said Sean McCarthy, an FBI special agent who is looking at the Manalapan sale. It has apparently become the most lucrative way to rob a bank. According to McCarthy, the losses to mortgage fraud now far exceed those from counterfeit checks and other banking schemes
Lemme tell ya Mr. McCarthy…You’re an outsider lookin’ in. No matter how bad your agency thinks the mortgage fraud situation is, you can multiply the guesswork by 10X or more and you might have an approximation.
And the FBI ain’t near big enough to deal with the scope, size, and dimension of this debacle.
wait until banks start to foreclose and find out that a large percentage of borrowers in reality were NOT breathing. Fake ID’s, four and five loans on one property, etc. If i was able to buy 5 or 6 properties, do a cash out refi, pocket several thousand $$, go ahead and foreclose, I would still have a nice bank roll. Figure out how many wall st types scammed avg guy dring dot.bomb and now how many average guys scammed how many banks in the RE bomb? Pay Back?
wait until banks start to foreclose and find out that a large percentage of borrowers in reality were NOT breathing. Fake ID’s, four and five loans on one property, etc. If i was able to buy 5 or 6 properties, do a cash out refi, pocket several thousand $$, go ahead and foreclose, I would still have a nice bank roll. Figure out how many wall st types scammed avg guy dring dot.bomb and now how many average guys scammed how many banks in the RE bomb? Pay Back? Goldman, ML, Chase etc made big bucks from the 90″s IPO’s and how much do they stand to lose when their CDO’s pop?
They are fully as pathetic as the whiners who bought property under airport runways and are NOW whining about the fact that (OMFG) AIRCRAFT ARE TAKING OFF AND LANDING OVER THEIR PRO_PER_TEH!!!11!
And the idiots in Rio Rancho NM (next to Albuquerque) that are buying houses next to the landfill (garbage dump) are going to be complaining that their home stinks. Well, the garbage dump was there first. It wasn’t hiding when you bought your white elephant.
Unfortunately, those new homeowners have more votes and pay more taxes than the pilots who use the airport or the racers who use what was a rural dragstrip or short dirt track. The airports and the racetracks eventually get shut down.
sorry about the double post
That’s ok
That’s ok
test
I have been tracking San Diego County foreclosure activity on forclosure.com for nearly a year now. The foreclosure number went through 5000 with a bang this morning: 5275.
Another interesting fact is that the number of foreclosures is approaching the number of pre-foreclosures. I.e. most pre-foreclosures go all the way to the foreclosure stage (although they might be saved in the last minute).
6/18/2007: 6086 pre-foreclosures, 5275 foreclosures (87%)
7/3/2006: 4553 pre-foreclosures, 415 foreclosures (9%)
good observation Tom
WOW, OB Tom, that is an incredible difference in just one year !
Good post.
“When the tech bubble went bust in 2000, Maryland homeowner Rick Boardman took his money out of the stock market and put it in something he thought would be safer, real estate.
Two parcels, just over 20 acres, near Cambridge, Maryland. He bought it in… April, 2005! Uh, bit of a lag there between the 2000 market dive and this purchase.
Dunno what this “summer of 200″ referred to, specifically, though maybe is euphoria was still rampaging in summer of 2005.
At least his mortgage doesn’t start ratcheting up until next April. Yikes! I bet the euphoria is really gone when that hits.
But a friend of mine here in Virginia with family property on the Eastern Shore just told me days ago… “Waterfront property will never go down!”. So Mr. Boardman can rest easy. Whew, a close call, that.
Uh oh, I stand corrected. Sorry for the misinformation.
Boardman actually did buy the two parcels in late 2000. It was only in 2005 that he took out some huge mortgages, probably construction loans. My mistake.
So even though he’s up to his ears in (new) mortgage debt, that land might have appreciated enough by now that he can get out without being skinned. Depends on how much he’s (over)payng for the house. My guess, though, is that he and his wife planned on selling one parcel and paying off the house on the other parcel so they can live there. That might not be happening.