Seriously, Have Any Housing Bubble Observations?
What do you see in your housing market this weekend? Notice any builder incentives on the web? Visit an open house this weekend?
Here’s an observation sent in by a reader. “The Central Valley of California (Visalia to Redding) is literally piling up with unsold new construction. Just a massive number of very large developments all rushing to build out. I’m near Merced, Ca. and a single middling builder has 140 homes built and unsold, and in a town of 17,000 homes there could be as many as 2,500 under construction as I write.”
“And they are just not selling. Inventory has gone from 157 (6/1/05) to 815 today. Anyway, I truly believe (yeah, right, everywhere is special) that this region will see THE implosion soon.”
And another wrote. “A local Santa Cruz real estate radio guru just sent this to me: ‘Special Financing, Grants, low and NO interest rate loans ARE available! Do you qualify? Hello everyone, hope you are all staying dry in this weather! I wanted to bring to your attention a very special workshop that we will be holding to discuss and explain some incredible financing programs that exist today YET many people do not know about. The following people qualify for many of these programs: School Teachers, District Emplyees, City & Public Employees, First-time buyers (you can own a home now and STILL qualify!)”
“There are currently many programs such as: LOW Interest Rate Financing, NO INTEREST loans - SERIOUSLY! Down-payment assistance programs, Closing costs assistance programs, Grants.”
“Seriously folks, this is no joke. You can make well over $100,000 per year and still qualify. Don’t believe me? Tune in to my TV Show as a lender who currently specializes in these loans and a City REPRESENTATIVE comes on my show to explain some of these incredible programs!”
This Thursday I was driving north on I-15, just north of Temecula when I saw a mortgage broker’s electronic freeway billboard sign. I missed the name of the company because I was so startled by the message, which read something like this:
“Refi today. We don’t use comps, we use the appraised value.”
What the heck does that mean? I thought comps were always part of a legitimate appraisal. If anyone else sees this sign, please post the name of the company on this thread.
That is sketchy. Maybe they are saying since the comps have been lower lately, they will use an existing appraisal (don’t know how long those are good for) or have their own sketchy appraiser come out and do a new one…lol
What it means, is the mortgage lender will coerce the appraiser
NOT to use the viable comparable sales in the relevant neighborhood which will indicate a COMP value, but the sales the applicant NEEDS to make his deal “APPRAISE”, even though they are taken from a superior location to support a higher value
and are in essence fraudulent.
Just a matter of Tony’s S., “Victor-the Appraiser” doin’ what’s he’s told
Mortgage racketeering at it’s finest…
Spoke to some construction guys in Vegas last night, using big equipment. They said there are seeing a noticeable slowdown in Vegas. Lot’s of work is drying up.
So if no construction jobs, can Vegas keep growing at the rates it has?
Simmssays…
AmericanInventorSpot.com
In Portland, ME, inventory of single family homes on Realtor.com continues to shrink. This is based on 3 zips: 04101-03.
Portland Only # SFH
9/6/05 186
9/19/05 223
9/29/05 224
11/3/05 248
12/5/05 241
1/3/06 210
2/2/06 212
3/3/06 204
3/8/06 195
3/9/06 189
3/18/06 178
Inventory was 39% higher in November 2005 and 18% higher in January 2006. I’m really starting to think this is being driven by equity bandits in NY, MA, CT, NJ and CA. Coming to an inexpensive market like coastal Maine is like coming to earth from Krypton - your housing dollars have superpowers here.
It still may be too early to predict anything though as the spring market has not truly kicked in yet.
Waves of RE speculation propagate from the source (NY, MA, CT, etc) out to the hinterlands (coastal Maine). By the time coastal Maine is cresting, NY, MA, and CT will be crashing…
Maine is odd in this way. It started to jump later than MA and it started to drop a little before MA, and since the population is so small (
That was weird… where did the message go?
Yes, and at some point along the way, coastal Maine prices will be so high and NY etc. so low that coastal Maine will lose its allure. Eventually the pendulum swings the other way. But alot of disaster between now and then.
Coastal ME has been owned for decades by people from the mid-Atlantic as their summer homes. Hinterlands would be the lands inland away from the coast–i.e, Central and Northern Maine.
Coastal Maine has also been owned to smaller degree by midwesterners as well as a fair number of saltwater seeking Canadians.
Although the state is not tremendously big compared to most of the states out west, it contains a very large percentage of the nation’s oceanfront properties. This is because its coastline is longer than all other coastline in the lower 48 combined and it’s all privately owned except for about 20 miles.
Old establishment money has long been quietly recreating on the Maine coast. Acadia National Park was a gift from the Rockefellers who still own large parts of the island the park is on. More and more celebrities are being sighted in Maine and there’s already been some movement to the Maine coast from more crowded hotspots such as the Hamptons and Nantucket. Weekending Wall Streeters can fly into Maine’s small airports in less time than it takes to drive to the Hamptons from Manhattan in weekend traffic. Martha Stewart has a place near Acadia, John Travolta has a midcoast retreat and Glen Close is a part time resident of the Portland area having just married the founder of a Maine biotech company.
The very southern part of the state counts many Boston commuters among its ranks.
The rest of Maine is still pretty much the boondocks and quite poor. The exception to this is lakefront real estate which can be pretty expensive. Just a few years ago you could buy homes on beautiful southern Maine lakes for under $100,000. This is no longer the case. Even homes on northern Maine lakes often cost over $100,000 these days.
Portland home prices have gotten quite expensive by Maine standards, but are bargains to Bostonians and New Yorkers. Many natives of Portland can no longer afford to stay in Portland and are heading north to places such as Lewiston and Waterville. As southern New England moves to southern Maine, southern Maine moves to northern Maine.
Considering U.S. population will hit 300 million this year, none of this is surprising.
Although the state [of Maine] is not tremendously big compared to most of the states out west, it contains a very large percentage of the nation’s oceanfront properties. This is because its coastline is longer than all other coastline in the lower 48 combined
That seemed too amazing to be true. In fact, it is too amazing to be true.
Coastline lengths are famously flexible numbers because they depend on how small a wiggle in the coastline you’re willing/able to measure. That said, it seems like the conventional number for Maine is about 3500 miles… about the same as California, which is still pretty amazing, but not as much as Florida or Lousiana, and not nearly as much as the whole lower 48 combined.
i learn something new every time i come here. fascinating.
Have you ever been to the California or Maine coasts? If not, have you studied a map? California’s approximate 800 miles of coast becomes about 1100 miles counting convolutions. Compared to Maine it has almost no peninsulas. Maines’ has been counted up to over 5,000 miles. Florida’s coastline is relatively tiny.
Actually, I live on the California coast, but I didn’t just eyeball the beach. What I did is, I looked up the answer.
Maine Geographic Information System approximately 3500 miles coastline
Maine Geological Survey 3478 miles coastline
Maine State Planning Office 2793 miles mainland coastline, 2507 miles islands, 5300 miles total
Coastline length of U.S. states (Department of Commerce, NOAA, NOS)
Maine: 3,478 miles
California: 3,427 miles
Florida: 3,331 miles Atlantic, 5,095 miles Gulf, 8,426 miles total
Lower 48 states not including Maine: 50,199 miles
According to fractal analysis, California’s coastline has an infinite length…
That is overly brief. In fractal analysis sets are measured by the extent to which they fill space. Picking a level of detail as minimum for calculation allows these infinite curves to be measured and compared. Official estimates of coastline length usually rely on a minimum level of detail of around one meter.
Fair enough, but your post makes my point — the length of a coastline depends on the minimum level of detail at which they are measured.
What those numbers say is there is stagnant growth in Portland.
Southern ME has caught a bad dose of liberal, NIMBY, I got mine-f*ck-you, close-the-door attitudes from the influx of arrogant flatlanders. “Tis chic to diss the masses. Let them eat cake…
Plus you got the editorial idiots at the Portland Press Herald who think ME has a “sprawl” problem with a million people in a state 5X the size of MA. You’d think these morons had never even crossed the Piscataquis River.
Three years to get a subdivison thru obstructionist small town, egotist, planning boards.
Too much risk for developers.
So inventory doesn’t do squat.
How’d you figure liberals had a corner on NIMBY attitudes? I’m in ultra conserv Repub country and let me tell you they’re pretty NIMBY here too. They don’t like blue collars, city types, or working Moms either. But that’s for another blog. The towns largest source of pride appears to be keeping out evil Walmart! Let’s keep the political jabs out of our comments. (otherwise one might think you’re easily sold down the river)
That’s Piscataqua….my hometown over there thankyou!
Here in kennebec valley ME about 1 hour north of Portland things have really picked up over the last month. While some things are sitting those houses priced right since the new year are selling.
Could be a dead cat bounce from winter — which was really slow –but the inventory here so far is tight as the spring/summer selling season ramps up.
Those Maine State Housing Authority 1st time homebuyers w/ their discount mortgages; Sec. 8 subsidies; and seller closing cost concessions will purchase an outhouse if it’s got a For Sale sign on it.
All the morons at MSHA
Don’t worry, Maine will soar! All ya need is a little more of that global warming thing. Buy now… before everyone else figures it out
Just a couple stats for Maine:
Maine has the highest tax burden per capita.
Maine is the greyest state. (I did hear from a friend that VT or NH may nave that honor now.
Maine has the highest percentage of second homes.
Maine is chock full of NIMBY’s. I had to add that as one of my own observations.
Maine is losing a Naval Air Station in the next few years and thier largest employer Bath Iron Works is laying people off every week.
The average pay is 39K. 38th in the nation. Remember the highest tax burden though.
I’m sure I can come up with more but won’t. I dont think Maine’s lack of increasing inventory is from sheople buying but rather people have given up trying to cash in on thier homes. I still think we will see a significant rise in inventory once the weather gets warmer. Then, as the bubble collapse get further along, many second homes will come up for sale.
Since Maine has few decent paying jobs, when the fecal matter hits the rotory device, many houses will be for sale. IMHO
I will continue to report on inventory. I thought it would be increasing by now, but it’s still a bit early I’d say.
I hope the second home market crashes - it would be nice to be able to buy lakefront affordably once more. Or would love to find a distressed ski condo.
Ad on radio for a housing development in Liberty Lake, Wa. Buy a house and get a free car. It goes on to say the car is yours for two years. This absolutely shocked me as it is so blatant and the first incentive I have heard of in our area. Lots of “reduced” prices, however.
I wonder what strings are attached for that car lease…I can see it now…no more than 5k miles/year every mile after that 50 cents/mile…lol
There is a fine line between Real Estate and Car Sales. We have erased this line.
It used to be that only one of these was liable to be a depreciating asset.
Owner occupied houses are not and never will be an asset -owner occupied houses are a liability.
Disagree… they are an asset but not an INVESTMENT!
Those who own only their own home are unlikely to be devastated by the coming firestorm.
Yes those of you renting with a lot of dry powder are also sitting pretty…
It is time for SUV sellers to invent the “open car”…
I read one ad in south florida that you get a 27 months lease on a jeep liberty and i think the condos where in the high 100’s for a one bed,,, I’ll pass after all my car right now is better than that…LOL
Carol -
My parents live on the South Hill of Spokane in a house they purchased in 1982 for $34K. They have put $150K into it (swimming pool, two car garage with guest quarters) and say that it’s probably only worth $200K now. Has stuff appreciated much in the Spokane/Valley area in the past 6 years? It doesn’t seem like theirs has.
I’ve lived in Spokane, WA for over 50 years and I’ve been following the housing market here for the last 2 years. I sold my house a little over a year ago and I’m currently renting. I have the proceeds invested and I’m waiting the prices to return to normal. The average price for a house in Spokane has gone up 68% during the last 5 years. I sure wish my salary went up that much. During the last 2 months, house values have been dropping (approx. $5k on a $200k home). The inventory hasn’t changed that much, I think it will be increasing in the near future. Spokane is always about 6 months behind everyone else. Of course, the South Hill is considered by some to be a prime location, so values are high there. If your parents ever thought about selling, now would be a good time to do it.
Thanks for the information Old Man (I feel bad calling you that, but that’s your name!). I had no idea that housing has gone up that much there.
My parents have been “thinking” about selling ever since the day they bought. I wish I could convince them that now is the time…
On the way to the airport here in San Diego you can see a lot of condos for sale. However in the Hillcrest neighborhood where I live I’m not seeing a lot for sale signs in front of homes.
Some friends of mine were talkin about their real estate business (they became agents a few years back when another industry was collapsing). Anyway, they were talking about their concerns, and one of them said they will be alright. NEVER have heard them talk about it like this, reminded me of their previous field (which the unions killed, along with their jobs). They are nice guys, and even though Pittsburgh is considered a cheap market, we have many signs of bubble-thinking here (certain areas with McMansions, pricey condos heavily subsidized by govt TIFs) and the way they were talking was unlike anything I’ve heard from them in a while.
I don’t really understand the loft/condo phenomenon in pgh. Who are buying these? Yuppies? When I left the ‘burgh in 2000, there were neither lofts (except for the Brewhouse squatters), nor yuppies. Admitedly, the lofts look very nice, but 350k nice? You could buy several houses in town for that price.
I don’t understand it either. The #1 industry here is health care. We also have too many hosp beds. The condo thing isiotic city leaders who bought into that idiot Richard Florida. People will come for jobs. THEN, when the young stay, the clubs will come. They tried attracting young people with all-night bus service. It had to end. Pittsburgh is a nice place to live, if you have family here. It’s still shrinking. Pop of city was 676k in 1950, it’s 330k now. Every year, it loses more. The growing areas here are the suburbs, some a few counties away. The city is near bankrupt, couldn’t even pay the rat catchers. Yet, they build condos. More in the works. It is insane, and this area doesn’t even have a bubble (or so the talking heads say). Some neighborhoods do.
It does seem like some aspects of pgh have improved over the last six years- whole foods, REI moving in. And I guess there are more jobs there than when I left in 2000. And as far as “rust belt” cities, it has more going for than say buffalo. The universities provide a steady stream of young people and cultural activities. Of course, most of the students are out of there once they graduate. And there will always be a steady supply of housing stock because of all the older people living there and dying off. It may not be the mcmansions that people want to buy, but there will be lots of solid brick house in constant supply. One of my friends who lives there once said that if the city wants to get people to move there, they should offer people a tax delinquint abandoned house for free to fix up and live in.
They did not listen to Richard Florida or they never would have done any of that crazy stuff. Richard Florida recommends getting big government out of the way of small scale local improvements. What they have demonstrated, once again, is their utter and catastrophic failure to understand what real improvement might mean. The Pittsburgh political machine will have to be wrested from power before it gives up its death grip.
If I get the devoper’s 760i BWM its a deal. If not I’ll stay with my 1970 Bronco.
I’ve seen only 1 SOLD sign in my area of town, San Diego, in 4-5 months. About 1 new For Sale sign per week.
Has anyone noticed a lack of SOLD signs too?
That’s because sales volume has decreased quite significantly per DataQuick. Looking at 2/2005, sales for the month was 3,442 with inventory of 8,500. For 2/2006, sales went down to 2,865 with inventory of 17,000 homes. Months of Inventory went from 2.5 months to 6 months. what a difference a year make.
They have hidden the “for sale” and “open house” signs for reasons I cannot explain. However, the inventory is still growing — 17,958 on ziprealty (updated twice already today) and poised to pass 18,000 this weekend. More than 200 of these have a listing date of 3/17/06 or later! (Typically, there are 200 or more homes listed for greater SD on ziprealty which are marked “new listing”, which means they just came on the market…)
The other interesting uptrend is in the “price reduced” category — currently approaching 31% (5562 out of 17,958 listings) and growing slowly but steadily. This is the early warning sign of future drops in the published price statistics. John Karevoll, are you ready?
Noah Gamer’s website lists 19854 today, up from 19257 on the 3rd of March. I drove around Escondido (North County San Diego, Inland) and there are a lot more places with for sale signs. The sign flippers are out in force too, 2 even sharing a corner. 1 had a sign that said ‘last chance’ or thereabouts - couldnt help but laugh. These sign
flipper kids are getting pretty good. A couple more years of this and I wouldn’t be surprised if it ends up in the olympics!
According to Noah, the inventory flood has surpassed the ten-year high water mark of 19,280 back in 1995. Do you have any idea why his site counts 1896 more homes than ziprealty’s?
No clue. I normally tracked the count through the helpusell website but that has stalled lately while Noah’s is piercing the ozone. Possibly including temecula? Lots of SD RE mags include properties from there or even random stuff from all over (palm springs, hawaii) that I think the agents or their close friends are desperate to unload.
The cool thing is that March is when things are just getting started, as far as inventory build goes. We might take out 25K in 6 months.
Things are selling in Upstate NY even stuff I thought was overpriced.
I dunno where you’re at in upstate but I made my obligatory trip to Glens Falls area to see relatives and all I see is $hitloads of for sale signs.
Caz. I’ve only got 2 other houses in my price range. Only 9 on the market between $150,000 and $300,00.
Phoenix has seen a 5% increase in the number of reduced listings from 1/30 to 2/18, it now stands at 33%. Remember, this is not counting homes that are re-listed with brand new listing date and MLS #.
Bubble Markets Inventory Tracking
The rain has stopped in San Jose this weekend and the open house signs are sprouting like California poppies. Just saw another possible sign, some hopefull soul kindly parked his SUV and Chris Craft boat across 10 spaces in a normally crowded parking lot facing an intersection. The boat is for sale and looks to be brand new. Hope he doesn’t come back to a keyed door.
Have you guys noticed how much crap there is for sale. Everyone is selling their luxury car, 4×4 truck, boat, dirt bike, harley, etc. I searched for BMW’s in Orange County CA on http://www.cars.com and the thing froze. Too many cars to list. Then I selected 2007 only and the thing couldn’t list the cars. Go to http://www.recycler.com and look for boats. Go to http://www.cyclestrader.com and look for Harley’s. It’s amazing.
Yes. In fact, I was thinking yesterday that there are nearly as many “garage sale” signs around SD as there are “home for sale” signs. Anything to reduce that crushing burden of monthly debt payments in the face of the prospect for no more household bailouts through future price gains…
It seems to me that someone should track this as a sign of the bubble.
This might be an interesting indicator, but numbers are needed. IIRC, the luxury new car segment is still going strong.
Personally, I’m hoping that people will start unloading Selmer low-A bari saxes for less than $3K.
i’ve wondered someone should create an index of crap that guages frivolous spending on EBAY: GI Joes, cabbage patch, beenie babies, whatever. Probably the best place to start is that crazy muscle car show where that 72 barracuda fetches $1 million (? dont know nuthin bout cars)
Bingo - Barrett Jackson Auction House. Have you watched the prices lately? I’ve been into pre-1973 cars for twenty years. This Barrett Auction thing on TV is weird. They’re setting records. If you look closely at the buyers they look just like my dad. Baby-boomers that just cashed out on their RE investment. They’re bidding on muscle cars at 100K to 1M. Four years ago these cars cost a fraction of that. These guys are stupid.
I just sold my 69 Mustang to a couple of armature baby boomers that wanted to sell it at the Barrett Auction and make some money. Cars are like RE lately. Guys are flipping cars just like RE.
During the last bubble, guys were buying several cars at once for investment and then lost a lot because they could not sell them for what they had bought them for. I’m talking high end Ferrari’s, muscle cars, vintage and exotic stuff. I think the 1980’s RE bubble gave them easy money to buy cars.
Two years ago the number of pre-1973 cars was very limited. Now if you search there is endless adds for good restored vehicles. History is repeating itself. That’s why I sold my mustang. I think the value of old cars is headed down along with RE.
Perhaps this is the NEXT bubble. Nostalgic toys for boomers who’ve cashed out their absurdly inflated boxes in California and moved to absurdly inflated (but significantly cheaper) boxes in the desert.
I’ve been watching a “flip” property that is on the way to my kids school. The for sale sign went up about a month ago. On friday, that lonely little house got some company….. A BIG boat parked in the driveway with a matching for sale sign.
classic.
This is strange. Just got a card in the mail proclaiming:
THINKING OF SELLING YOUR INVESTMENT PROPERTY ? WE HAVE BUYERS ! http://www.Phoenixhomesbydavid.com
I feel like calling the number on the card and asking if he has buyers then why are there so many damn houses on the market.
From that site….right at the top:
“Phoenix Homes by David offers a
$2,000 Cash Rebate on all New Home Sales
New home builders in the Phoenix Arizona area now have lots available
There are 752 new home subdivisions currently under construction in the Phoenix area….”
Momoney - This is a CALSSIC “listing PLOY!
His buyers ONLY buy from HIS listings etc. These “ads’ are a sign that Realtors are looking for income and paying to get it!
My wife sold R.E 20 years ago.
If he had a buyer for YOUR place he would have shown up and knocked on the door!
Continuing to watch inventory rise in Va. Beach and Williamsburg, Va. From December 2 to present –> Va.B. 1190 to 1302 s/f/h; Williamsburg from 490 to 590 s/f/h. Median price up 1% to 2%.
For condos, since last July 24 –> 185 to 411; Williamsburg 29 to 96 (a little decrease in Williamsburg from 114 over the last month. Median price basically unchanged with some variability in both areas.
Several of the most-reduced patio homes in my targeted development may have sold (although several seem to be relisted after several weeks off the market).
My read is that the staredown between sellers and buyers hasn’t been resolved yet, but the more inventory increases, the more likely that buyers will win.
Looks like Norfolk Ocean View sucked in a bunch of condo flippers last few years. I owned 2 condos bought out of foreclosure in 1988 after the last condo bust for $40k apiece. Kept rented for positive cash flow for 14 years, but with no appreciation I was happy to finally unload both in 2002 for $50k apiece. I see they the same ones going for $175k last year, and the rents not much more than in 2002. Way out of whack.
Realtors “At A Loss” For Words
To be fair, they’ve played with the assessment for years. This is the 2nd oldest county in the US (IIRC Palm Beach is #1). Wouldn’t these higher tax rates hurt the market here? I guess realtors are always upbeat.
SORRY that article is a year old. I saw the date, didn’t notice year. Still, it seems new. in that PNC is building a hotel & condos downtown. I don’t like the idea of banks becoming real estate speculators. It just occurred to me, that in the last year, Countrywide moved into the larket here, and there’s a new place down the street that helps you self-sell your home (just as the rental market is finally coming back).
$500 Million in Construction
Shadyside is a well-to-do area, E Liberty is run down, with shootings often (for this city). There is NO way E Lib will become Shadyside. I love Pittsburgh, but the development that will work are the health & education sectors. There’s plenty of shopping elsewhere (Homestead). This article makes it seem all of this is due to Home Depot (1999). That was 7 years ago.
My take is that appraisers or the appraisal dept. of every major/minor lender is going to be seeing this massive inventory build-up and be alarmed .
Appraisers have some responsibilty for sure but the banks use automated valuation models for 65% their loans. No appraiser is involved and noone sees the property. Now I wonder what they will find when someone does actually go inside these properties.
Nah, all the appraisers with a brain and a conscience have been run out of the business. The hacks don’t care. They will be checking the stable or increasing value boxes until the G-men come and take them away to prison.
Every few weeks I do a driveby of a nearby development in Tucson. Of the finished homes (about 650) 50 are for sell, and 10 for rent. 38 were for sell around Jan. with 8 rentals( a 31% increase). The mix has changed however - in January the cheap starter homes were for sell, but now the cheap homes no longer have signs in front and it’s the bigger more expensive homes for sell. - what does this mean?
I still find toys too expensive - I’m looking for a plane - I am seeing a small maybe 5-10% decline in prices so far - so I’ll probably have to wait 5 years to buy.
Tucson, AZ
Local paper “Arizona Daily Start” printed today:
“Get $20 000 in free upgrades”
for developments in SaddleBrooke and Quail Creek.
This offer for first 25 homebuyers only.
There are probably 4-5 full pages ads for condos.
It’s probably the first time i see it in Ticson.
Does somebody know if speculators/flippers
defined as a buing force left market already ?
Based on all the vacant property alot of investors are around .How would you like to rent from a flipper who is waiting to get out of the market?
The Clownifornian flippers are definitely here in DFW. They’re buying the worst possible neighborhoods (Dallas’ version of Queen Creek) and trying to rent them out at ridiculous rents. Here’s one. The guy must be on dope. Anyone who can pay $2300 a month and is willing to live in McKinney TX owns a house. He or she would be lucky to get half this amount in rent.
http://dallas.craigslist.org/apa/143058759.html
At 3,541 square feet, I wonder what the AC bill runs you on that monster?
This summer it will be at least $500/mo. I think I am being very conservative with that guess.
Here’s another one. Note the California phone number. These people have no idea yet but whatever money they have in this albatross is gone forever and they will be on the hook regardless.
http://dallas.craigslist.org/apa/143184152.html
My guess is this rents for $1K max if they can even find anyone. There are so many new houses being built out there and builders giving incentives, why would anyone who wants to live out there rent?
More than $500 a month during a hot summer almost a given if someone is living there.
The builder here are really realy bad about spending one extra cent on making those homes more energy efficient. Some quick rants about them:
* A/C in texas is electric, and in some areas heat is also (instead of natural gas).
* The A/C units the builders install are of the minimum efficiency, aka the cheapest, that they can get away with (code).
* Advanced features whihc save money like fully programmable thermostats and zone controls are usually not included (’to save the builders money)
* The house probably has fewer, larger A/C systems which are strained to cool on a really hot day, rather than more systems and zones. The house in question needs at least 3 system IMHO, probably has 2, and wouldn’t be shocked if it was only one.
* Insulation? Sure it’s got some, but I’ll bet it’s surprising lacking comapred to what it would take to really help.
* Shade tress to reduce direct sun on the house? All flattened when the street was put in. Don’t expect any new ones to grow in for 30 years, and for them not to be much anyway.
* High effieciency windows that also provide great ventalation and cross-flow? No builder is going to pay extra for that.
* C/F Lightining instead of incadecent? Of course not; Despite the recent advances that remove all the old annoyances and give the new bulbs a specturm better/more comfortable than most incadecents. Add that to the electric bill each month.
On top of that, the cost of electricity in Texas is up nearly 100% in the lat 3 years. It goes up everytime the price of anything goes up, and comes down… well, never.
Just to add on top of what others have said, the relatively tall roofs are great for shedding water and holding snow, but in Texas that much roof acts like a kind of solar generator. The result is strong heating of all enclosed spaces underneath. The little houses with shallow roofs that people used to like to live in are much more efficient in this respect. Also, being two story with bedrooms above brings in yet another design challenge to livable cooling of this space.
inVegas..power (air conditioning) is going up 24%! beginning June 2006
Wow that sure is a purty house. Bet the rent on it is 1/2 of what the mortgage payments are for the “lucky” owner. We have a paid-for house that we rent out in a depressed area of the country ( but in an excellent neighborhood ) and we are getting only $ 775 less per month for our non-monster. That place looks like a real loss leader to me.
So Mckinney is a bad area?
It’s one of those overbuilt cheap tract house areas that will end up as a blue collar ghetto full of foreclosures. It isn’t “bad” per se right now but even in phat times, there were very high rates of foreclosure and bankruptcy there.
TxChick57 seems to come off a little harsh on nearly everyplace that is not preston hollow/park cities.
McKinney is not bad place to live, but how good or great it is depends on your wants out of life and for the place you live. It is basically a remote bedroom community that a few years ago was mostly cotton fields. Everything is pretty new, and pretty much the same as the other sub/exurbs and it seems nearly everyone crowds the same highway each day to commute to work. It’s a place where middle class people can live in neighborhoods full of people just like themselves, raise children, and try to get ahead.
Remember, here is a place where an average person can get a home in a safe neighborhood for $75 to $120 a sq/ft. You can sneer at that, but show me anything that compares in Cali or other bubble zones for Joe and Jane average income who aren’t looking to become overnight millionaires, but are going raise 2 or 3 kids and want to enjoy life a little.
However, from an investment realestate standpoint, it is as bad or worse than txchick57 depicts it. Almost all of the city’s housingis recent mass-built subdivisions. Pretty on the outside often in a cookie cutter sort of way, but nothing special on the inside in terms of construction, lots, etc. For years to come, pre-owned homes for sale will have to compete with not only a lot of very similar homes, but with new home construction close by. Trying to beat the builders in those areas will often feel like trying to beat the house in Vegas. And then there is the carrying costs. That $250k 3,200 sq.ft house probably costs $2500 a year to insure and $7,200 in property taxes.
I am from California (currently in Miami), but moving to Texas next year and have studied the markets in these area very closely. These California speculators don’t do their homework when making these speculative house purchases, especially in regard to taxes etc. Since there is no TX state income tax, the property tax rates are extremely high. This balances out if you actually live in Texas, but if you are out of state and trying to rent out speculative property, forget it. The fool in this story probably thinks he can rent at a price to cover his P&I AND other carrying costs (i.e. taxes)…it just won’t work.
In January the Condo sales were up in Orlando 137%. Does anyone have a theory on this. The only thing I can come up with is that there are so many Condo conversions and NO rentals and I mean None. Good neighborhoods or bad doesn’t matter. People have been presented with “but it won’t cost anymore than your rent” so they buy these conversions are ridiculous prices.
Also prices are not coming down here but then again this is Orlando “it’s a differnt market.” Maybe it will just take longer for the bubble to pop.
Any observations or knowledge on the Orlando market out there?
I am an Orlando based appraiser and all I can tell you is the condo projects I see are vast wastelands of dark windows. Downtown on a Sunday night, take a look around. There are no lights on in 80% of the units. I do not know who told you that sales were up 137% but that may reflect the fact that it has been dead. In the Orlando market we have approximately 50,000 properties on the market. The local MLS says they have 12,000 when in reality if you look at MSA figures we have 29,000 properties on the market in MLS, and probably as many in FSBO, discount broker, and 800 broker categories. Obviously the average person is an expert and does not need brokers any longer. Last I heard 25% of the local brokers did not pay their dues for the year. A lot of people are hanging up their licenses as they cannot sell anything. We appraisers are keenly aware of the downturn and I have notified all of my clients that we will be checking the “market declining” box on appraisals within the next few weeks. Yes, that is exactly what I told them and guess what, they asked me to please keep them informed and my volume picked up. Honesty is always the best policy. Oh and if you think the market is not declining in value, seek help immediately cause you are in dangerous denial.
Hey Jack-As soon as the brokers hear you’re a “doom and gloom” declining value appraiser, they are gonna go to your clients and say, If you use “J” anymore, we’ll be f*cked if we bring you any more deals.
Your clients will go along, when they find they can’t sell the mortgages for the properties you are appraising.
You’ll be black-balled toast in a couple months.
When you ask, what happened to your “volume”, they’ll tell you work is slow.
Enjoy your sandwich.
This was very good , honest information , from a person out there in the thick of it . Thank you very much and I wish you the best of luck in your business .
I have been at this for 30 years and never ever signed a report I did not believe in.
Yes, it has cost me business but when the hammer falls those of us who have held the line will be busy working on REO properties for years and years. My company is the one called when the banks want to know what it is “really worth”. I am proud to be known as the conservative appraiser. I sleep well.
A fact not well known is that the appraisal business got it’s start in the depression not the best of times. It is easy to value on the way up as everyone is an expert. Try the reverse. Not so easy.
The truth be known the anger we will all feel soon should be directed at the fianancial industry primarliy as they have behaved as jackalls preying on the taxpayer in the end. Oh yes, the American taxpayer will end up with the tab, not the fee earning lenders.
In the past 13 years my company has appraised 14,000 REO properties in Florida and in 50% of the cases we found misrepresentation by the lender to be the root cause of the foreclosure. They put people in homes they simply cannot afford and also the borrowers are foolish enough to think that there is no such word as change.
I have known for years that this would end in tears but noone wants to hear it.
Shoot the messenger right Jack ??
Thank you for responding, I got that number from the report that the Florida Association of Realtors put out. And I just couldn’t believe it. Prices just don’t seem to be coming down but based on what you have said - it shouldn’t be long now. I am a renter and have had my eye on the prices and I guess I expected too much too fast. Thanks you again for the info.
Jack –
Thanks very much for the first-hand insight to the Orlando market. It is very interesting that the darkened window syndrome affects downtown San Diego’s high rise condos similarly, even though all real estate is local…
If your in Orlando Florida, I would heed the wisdom of Jack…
Another brief story that has many chapters written in Central Florida. I do a lot of review work for lenders who do not believe the appraiser. I have some amazing stories but just one for now.
Recently I was asked to go to an area about 30 miles south and an area I know well as it was once part of a friends cattle ranch.( Not long ago)
I pulled up to the gated community and was dutifully asked why i was there. I explained my business and was allowed in the gates. I was surprised to see 100’s of glistening new homes in every direction and absolutely no, I repeat no, traffic. It was as if I had driven into Oz.
I drove around looking for the street upon which was located the house I was to inspect with the report I had in hand. There are no maps as this is so new.
I found it and lost my tunnel vision as i looked at the subject property I began to scan the street. The were no cars. I looked in all directions and there were no cars. Had I found the area of model homes? Had I been teleported to house heaven? Where am I?
I began to drive in concentric circles to locate the comparable sales and in each driveway there were no oil stains. Oh yes this is one method we use to determine if a house is or was occupied. At each sale there were oil stains. However, in the other 330 homes there were none and when i walked around back I saw no grills no play items for kids. NOTHING!
In the front windows were “For Sale By Owner” signs like you buy at Home Depot.
Now I take you back a bit, recall we came thru a gate that is manned and you must have business there to come in. Yep, the public cannot get in without an escort to the sales office. So how in the heck is someone gonna see your FSBO sign?
Amazing! Wouldn’t you like to lend money to this bunch of people? Not a single one…..330 of them. And yes all but 29 houses are investor owned, and folks, they ain’t from around here. Europeans bought them all. I am sure glad we have them owned by people with roots in our community.
Oh and those 3 sales, they occurred last August and that was the only sales activity in the last 9 months. Welcome to America.
Great story. Unfortunately I fear that stories like this will be all too common in the coming real estate collapse. What a waste of money!
I won’t comment on Charlotte as a whole, but I watch my zip code each day. Inventory has edged up to what it has typically benn the last couple of years. Values are rising close in to town. Further out I can’t see much if any change from last year. There are sales, though, when the house in good shape and/or priced appropriately.
I sold from California too early, but at least I re-invested in a stable market.
In Greater Northern Virginia, there are now 13,834 available listings. Last March, there were this many: (ready?) 2,545.
But not to worry. According to the latest “Real Estate Chat” at the Washington Post-dot-com Maryann Haggerty assures us that the reason prices are so high is because everyone is indeed rich here. THEN, when questioned in disbelief, she quoted a census statistic that our median income is 88K a year. Now, the first poster was complaining that his 100K a year couldn’t afford a 400K condo, and she told him he was poorer than everyone else, unfortunately for him.
I just don’t think she gets it. (But I used to work for a big Journalism outfit in D.C., and while they were good at union negotiations they had a hard time thinking outside the box.)
“Please” - I have to post my favorite listing comments of the week -
MLS #: FX5432538
Description
“Price reduced. Contract fell out. Make your best offer. Big 5 bedroom colonial on large secluded lot [. . .] Owner has found hoc. Please make an offer. 1 year home owners warranty conveys. “
In St George Utah there are 2 000 homes for sale with only 100,000 people that is 1 for every 50. There are entire developments that are built out, with not one home ever lived in. I called a guy whos name i saw on most signs in one development and he said he was sitting on 35 properties and St George is the New Palm Springs.
Not to Funny, i am working on a house where the guy can’t afford it so he helps frame. He is hoping to dump it. I take it he is up side down. When ever we leave the job at night he sits around looking at it with a real sad face.
They need to just drop the price. Forget incentives and trying to keep the comps up.
MLS #MC5281719 SILVER SPRING, MD
“Bring offers!$20,000 seller credit 4 ratified contract by 3/31/06!”
DOM: 276
In La Costa (Carlsbad, San Diego) 92009, There are very few homes for sale compared to what’s been available for the past two years. The homes which do go on the market are still selling — too quickly for my taste. The prices, though, are about what they were in mid-2004, if not lower. This is an upper-middle class neighborhood.
In Oceanside (92057), San Diego, there are more homes for sale and for rent than I have ever seen (over 8 years). This area continued to have double-digit appreciation through fall of 2005. It’s one of the areas which has not seemed to slow down at all, perhaps until now. This is very much a working-class/starter home neighborhood.
Carlsbad is very desirable compared to Oceanside.
Very desirable. Oceanside used to be known as “Oceanslime” and was considered a shi*thole as you may well know. Many parts still are.
Lower end falls out, higher end stays stronger. Never fear, Carlsbad is higher, not highest.
Yes, that’s why I wrote the upper-middle vs. working class/starter above to describe the differences. I think it’s important to keep an eye on both higher and lower ends to determine what is really going on. Also, I like to track inland vs. coastal.
That being said, its the **lower-class** neighborhood that is doing better with respect to ROI. My parents were RE brokers/investors for almost 3 decades, and they have always pounded it into my head that the better neighborhoods lag the poorer ones. Our “better” neighborhood in Carlsbad has been dead for almost two years. Our Oceanside home, which we sold in spring of 2004, has not stopped appreciating at all. You’d be amazed, but the prices have actually moved very close together. That’s probably why LC is moving again. You don’t have to pay much more to live in a **MUCH NICER** ‘hood. Not only that, the price per square foot is actually **higher** in Oceanside than in La Costa. It’s unreal.
*I meant better neighborhoods lag poorer ones with **respect to ROI** not how they move in the cycle.
And I meant “it’s”, not “its”.
I’m sure the neighborhood is better but the houses are not. People are getting what they THINK are deals in Oceanside. So not much is moving because people think Oceanside is still hot and why pay for a zipcode when I’ve got a newly renovated 3/2 to show you only 4 miles away?
I’d never even heard of Chula Vista or San Marcos as anything other than just one of “those places” until 2003.
I know that this topic has been addressed from time to time, but I think it is worth repeating: what will be the effect of the bursting bubble on “rapidly gentrifying” inner cities? I’m thinking primarily of second-tier East Coast cities like Baltimore and Philadelphia. It seems that flippers have descended on these cities in the past five years buying everything in sight - I remember it was only five or six years ago in Philly that it was a gamble to go anywhere south of Center City (South Street being the southern boundary) and now the “hot” neighborhoods are half a mile to a mile south! Also, in Baltimore, came across this article: http://www.citypaper.com/news/story.asp?id=11587. These poor guys rehabbed a rowhouse a few blocks from an established gentrified neighborhood (seemed to do it for genuine reasons, not for a quick buck) and just sold it after five years of dealing with crackhouses, crime, poor police presence and bureaucratic nightmares - and this is with a police substation on the first floor of their building! I think these areas will fall first and the gentrification lines will quickly be drawn back.
I watch my zip daily like some other (many, most?) posters on this blog. In zip 92831, North Orange County, California, there are now over 140 listings. In 2005, the average was around 80 to 90 listings.
Strange thing is that prices in this zip are still climbing.
NOT STRANGE! They would like you to believe that.
The bottom end stops selling. The buyers are jumping at the “steals” they are getting for higher end places that have been reduced. All 3 bed/2 baths are not created equal.
This is the brief period at the top of the trajectory… brief is relative… this will not happen in stock-trading time.
Yet all prices in the zip are rising. From the 1 Bedroom 1 Bath near the railroad tracks to the becoming-almost-famous up to 3 million-dollar Raymond Hills, with a lot of us in the flatlands with quality Craftsman homes in a preservation zone in between. They are selling at continually higher prices, albeit more slowly than before.
I am a staunch believer that we aren’t different and I certainly don’t believe that prices never go down here. I’ve seen them go down in the past. The true dynamic escapes me. Compared to other parts of the country I have learned about on this wonderful blog, we are in the stratosphere!
I understand the “brief” part, but fail to justify the huge price disparity base on quality-of-life and weather alone. Why are we so different, or are we just the laggards?
Again, try comparing the SAME house. The exact same 1 bedroom or the same 3 bedroom or the same mansion.
Or let’s put it this way.
One 3/2 sells in 2004 for $200K. It has a leaking roof, painted over Craftsman wood, infested with termites, broken porch, and the landscaping is destroyed. Only that home sells. The median is thus $200K for 2004.
Another 3/2 sells in 2005 for $210K. It is the same house with $50K worth of work done on it. It is now pristine. No leaks. Restored wood. Tented. New landscaping and porch.
The paper dutifully reports that the median rose. It did.
Would you have rather sold YOUR home in 2004 or 2005?
PS: I also love my craftsman.
I dont agree with Mr. feepness, in all due respect. In the complex market for real estate, there will still be backwaters where the dominant trends are late to materialize, just as there are neighborhoods that are leading indicators. I find it easy to believe that a single, highly-desirable zip code in OC can buck the trend of RE pricing for several months, if not longer.
That much said, the data tests that Mr. feepness suggests are reasonable to try.
Feepness & Sydney are both right. The market is complex. I rent in Piedmont CA….Very desirable. Right next door is Oakland…..Not so desirable. But they share the same zip codes.
Oakland sees houses moving much more slowly lately. Piedmont, while slow, still moves most houses in under a month. Your vantage point and the complexity of the markets make is difficult to figure out.
Thanks for the input. Zip 92831 is very heterogeneous. High crime small houses by the railroad tracks (under 5,000 sq. ft. lots) to 5,000+ sq.ft. no crime mansions on a 12,000 sq. ft. lot with an incredible view.
Home Depot and Loew’s are almost always packed, and the contractors and handymen/women available in the rags are always booked far in advance.
I bought my Craftsman home very long ago, but have since put in more sweat equity and permitted improvements like a new roof , upgraded electrical, Central A/C and heat, all-copper plumbing, insulation, earthquake retrofit, gutting and remodeling at a price exceeding cost of purchase. I bought it as a “fixer”. It is now “fixed”.
Wonder how that affects the equation. Not similar to stucco tract homes with avocado appliances, but “projects” that may take 15 or 20 years to complete.
Seems to be a plausible explanation for the “unreal” price appreciation of some areas. Thank God we’re not in Phoenix!
Sorry, Ben. No offense intended!
None taken,
I live in N AZ. You could’t give me a house in PHX.
Thus why I wrote above it won’t happen in stock trading time.
I am strictly analyzing the conundrum of sales volume dropping while the median still rises, which is indicative of what I mentioned above. Only the high quality stuff sells, so buyers are getting more for their buck, therefore the price has actually dropped. Many others have pointed out the $/sqft is more accurate, and yet less often quoted.
I do agree that all areas will be at different places on the curve… even separated by many months.
OK, this is one of Ben’s bait threads that I usually avoid. But, I gotta tell y’all, I had a post card stuffed under my door this afternoon, introducing me to my new neighbors!
I live in a quasi-ghetto part of our nation’s capitol that has been undergoing gentrification. The neighborhood has got better, to be sure, but we still push our $5 bills under bulletproof glass to get milk, beer and the odd loaf of bread. Or, should I say, the odd six-pack?
Anyway, we had a beating a couple of weeks ago in the street in front of the house, in the middle of the night. GF called the cops, who showed up quickly and subdued 5 or 6 young men, laying them out in the middle of the street in handcuffs. ‘Nuff said about the hood.
We pay $1750 in rent for a fully-renovated, 100 year-old, two bedroom rowhouse with 2 1/2 bathrooms, a working fireplace (wahoo!) and an unfinished basement - great for doing laundry and storing our junk.
Back to the postcard - house behind us was bought by speculators last summer, for $450K, and renovated. At what cost, I’ve no idea, but a gut job was done, and they ain’t cheap. Ask when they were done was $680,0000. It took ‘em 4 months, but they sold the place.
Now, I’ve got this postcard, hand delivered, with exclamation points, smiley faces and welcomes! From my new neighbors! They are from Massachusetts, according to their note, and have just bought a ghetto rowhouse for, if you do the math, 388 times my monthly rent! Jesus H. Christ!
How the hell do I deal with these people at barbecues? What do you say to someone with a $4,000 mortgage, who just got mugged on the way home from the grocery store? Help!
DC_Too: What do you say to these people at BBQ’s? Well, how about this…
“My, but that’s a swell 150,000 BTU nine burner Jenn Air Outdoor BBQ Suite, with outboard microcomputer controlled Infuseron (R) meat sauna and six speed counter-rotating tri-spindle rotisserie. And in solid nickel too! Brushed stainless steel is so passe. Did you get it at The Great Indoors?”
These people are obviously know something you don’t. Otherwise they would have never paid 388 times rent (Jesus H. Christ in a chicken basket !! Do people really think that makes sense ??) for thier swank pad in your ‘up-and-coming’ neighboorhood. They are probably clearing $1750 a month in appreciation alone, you bitter jealous renter.
Actually, now that I think about it, you should stay far away from anyone who announces thier arrival with a postcard. Maybe you should pay some of the local citizenry to hold another mass beating in front of thier house. Best to scare them off before they really do invite you to a BBQ. Eeek!
whoa………..see what’s being served at the bbq and THEN work out the deal with the neighborhood kids.
(might be tri-tip, you never know)
Good point Cereal. If it was tri-tip, (or Brisket as all real Americans know it) I would have the kids snatch the meat first, then commence with the mass beating.
I wouldn’t hold my breath. Massachusetts isn’t known for its BBQ. And if its tofu dogs, get several blocks worth of neighborhood kids.
Oh no, I’m sure they got a reduced deal! They probably only paid 380 times your monthly rent!
I guess you could say:
“Don’t worry! You’re losing more in equity every day than that mugging could have possible taken!”
No, I got it.
“You may want to save some of that potato salad.”
There seems to be little inventory here in Studio City,CA. But everything is just sitting with high price tags. I have seen houses at reduced price and re-listed, but not many.Nobody can afford these prices. Builders are still building McMansions everywhere.
There were two open houses today in my condo building (Cupertino, CA). I checked my mail a couple of times today (in the lobby) and had my husband do a couple laps around the building during his afternoon jog. Neither one of us saw any activity. One of the units is priced to move and the weather was very nice today. These open houses had plenty of traffic just a few weeks ago.
The condo market will be the first to soften….
It seems like every street corner in San Diego has a sign saying:
“Real Estate Investor needs Apprentice. $20K/month. ### ### ####”
Dear Lord.
Oh yeah, and there are four houses for sale on my street (not just one block… about a half-mile stretch). I think that’s the most since I’ve lived here.
Oh, I’ve seen those signs, too. I’m tempted to call to see what’s up. Will report back if I find anything out.
Humm - you must be near my hood - I saw that sign last week on the way home in South Mission Beach at the stop sign at the Beachcomber…
gonna try to close that tag…
test
test
Here is a virtual tour of the place my wife leased for a year. We moved out at the end of February because the owner wanted to sell and trade up to a $1MM+ investment property in Riverside County (CA), which he expects to sell at the end of 2007 for a 30% - 40% gain.
It’s a nice enough house. Problem is the owner wants to sell it for $740K, even though two comparable houses immediately across the street sold for $580K and $620K during the last few months of 2005. When I asked the owner about the premium, he told me that the BBQ island in the backyard and other upgrades would bring in the buyers.
What the ad fails to mention is that the house is trimmed out in straight builder’s grade stuff. When we moved in last year he had scotch tape holding on the broken corner tiles on the kitchen island. Check out the 9′ x 12′ patch of grass in the backyard. And as if that wasn’t enough, I could stand on the wall in the backyard and actually touch my neighbor’s house.
The ad’s background music makes me feel like taking a shower.
That’s pretty sad. No offense, but I wouldn’t pay more than $350K for that. I’ll bet HOA dues are pretty steep as well. No thanks, I’ll just remain a renter.
Oops - I forgot to close quotes on the link. It still works, thought - just click anywhere on the last three paragraphs and it should launch the virtual tour.
Golly! Is the yard really so small! It used to be that you could use the back yard of a SoCal house to keep a dog, but where would a dog do his business in *that* yard?
I have two frisky Laboradors Retrievers. Let’s just say I re-sodded before I moved out. The yard was so small, the sod only cost me $70!
Observations from the CA Central Coast:
1) Inventories continue to climb steadily
2) Sales are down
3) Price reductions are more and more common
4) Builders are offering promotions to drum up business (just recently I saw: buy a new house in Nipomo and get a $2k flat screen tv)
5) I am seeing FSBO signs for the first time
6) Sellers with big places to sell are investing in big signs and a lot of advertising
I would love to believe that buyers have gotten smart, but frankly, my impression is that most people in this area still believe that high prices are hear to stay. IMHO, I think sales are down because we have reached the peak of what people can afford, even with creative financing, long communtes, and financial sacrifice. This peak price seems to be $500-600k, and as entry-level homes in community after community reach this level, sales begin to stall - this is my impression, anyway.
trying to close tag….
HUGE INCREASE IN RE ADVERTISING!
Yesterday morning saw an 1/2-1hr informertion on tv from mort. broker. You know, the buisness new tv set looking shows. Three actors portraying two RE bulls with impartial commentator facilitating.
Later that morning my son was playing with the radio, two local stations were broadcasting from new home developments for a better portion of their day with all the radio host freebies.
A couple of years ago attendened a sales pitch from realtor.com in Sacramento, CA. I figure there were at least 1,000 went through during multiple groups of agents. It cost like $7k/yr for prime adspace on the site as “Featured Homes”, your would pop up first in any area you bought from now. Their pitch was like “This is your only chance, if you don’t buy your area now someones else will, you will never be able to obtain this again, internet is revolutionizing the industry, this advertising will be so lucrative that it would be worth it at any price, etc…”
Leaving this event there were several tables (like 6-10) taking orders from hundreds of agents. Many were contracting for multiple areas, dozens left with multi year commitments
for at least $20k/yr (some much more). There are also fees you get charged based on your sales volume. You pay more for extra pictures in realtor.com, I know a guy spent $3k last month.
The ammount of money now spent on CA RE advertising is amazing. I am only referring to induvidual agents here, not what the large brokers spend.
I am sure there many individual agents in LA, SF, etc.. that spen in excess of $1mill/ yr!!
There are also hundreds of agents in each large city that must spend $100-300k/yr.
All this is like a death throw, they seem to be tripling their advertising in the face a rapidly dropping volume =)
After reading many of your comments I am convinced that the majority of sellers out there have not got a clue as to what is happening in the market place. I wonder if we had had the internet in the 1920’s what kind of thinking was going on in the stock market before it crashed. I’ll bet there are similarities. Buying on margin brings up a HUGE similarity to buying with no money down!!!
OUCH! look out below!
coastal California, Miami, NYC… ok. Who does not want to live there. Appreciation makes sense. But Bridgeport, CT a one-way 90 minute commute with Metro North from Manhattan ? Just checked out a condo there today. Asking price: 310k. Thought it was way overpriced- then checked the previous sales on zillow.com . In 1999 it was sold for 85K. In summer 2003 the same unit sold for 187K. And now the owner wants 310K for it.
This is almost a 300% increase since ‘99 (7 years). And yes, people, this is Bridgeport, one of the most crime-ridden (previous mayor is in jail) high-taxed towns in CT - owning a 2003 Four-Door Taurus Wagon, you are paying $309 in annual property taxes for your car. Tells you something about the 40. mil rate. Will be amazed if this sells. But then again, this is CT and according to the realtor I spoke with you can’t look at what the previous owner paid for it 2 or 3 years ago because “that just don’t make sense”…
Around the corner is a house that a psychic works out of and has that big sign…You know the sign..PSYCHIC etc. Well, right next to it is a FOR SALE sign. Do ya think she had a vision of the great bubble bursting and decided that she’d better sell now? It was so funny I took a pic,don’t know where to post it so you guys can share in the fun!
Please attach to an email and send:
photos@thehousingbubbleblog.com
Please keep it under 1200×1600 pixels and 2.5 megs.
My mom lives in Redlands, California. A really nice way out yonder suburb where it makes sense for few to live, but you’re lucky if you can. Anywa, there was a sign on a post next to the exit of Targe/Bed Bath/… that said “Help! 5 Bed/3 Bath For Sale”.
It’s bad when you have to get some poster board and markers ,and use marketing lingo like “Help!”.
Went to an open house today in San Mateo, CA. It was an absolute FRENZY. Just like 2004 all over again. There were at least 30 people there. We stayed 5 minutes. The place was a total dump. Asking $935k. I bet it’s sold in 5 days.
I can’t believe the mania still has legs… I’m beginning to think it will never end.
>Asking $935k.
In San Mateo? $935k? What the hell size was this house?
about 1600 sq ft. decent but not stellar area.
Today made me seriously think about movin back to Sydney. I already own property there which has actually done really well despite the downturn. We could own a gorgeous place in a wonderful area and send the kid to private school there.
All we can get here is a dump… It’s just not worth it.
SM,B I often wonder about where else I could go. I can’t though, custody issue. This is very very disheartening and the fact that it has gone on so long has just created a level of exhaustion. I kind of feel like just chanting, “It just doesn’t matter” over and over.
But then one of the sages here pipes in with good solid words of wisdom about how patience will be worth it in time and I can go a while longer.
I found this post on Craigslist with a picture of 44 lockboxes on a bench outside of a condo buidling:
http://washingtondc.craigslist.org/apa/143368372.html
That’s right; the lockboxes aren’t even in the building.
I am looking for a place to rent in that area. I’m thinking of offering no more than $1000/month for a 2 bedroom apartment/condo.
How would you ever find the lockbox of the unit you wanted to view? It would probably take an hour. You should email a higher res copy of this for Ben’s photo album. Great pic!
Open houses all over Costa Mesa. Saw one corner with 4 open house signs.
Nothing moving that I am watching. Amazed to see some of the new McMansions at Orange and 23rd on Zip listed for 1.3 Mil. (Jesus H. Christ, who is gonna buy these zero lot line monsters?)
Spoke with a Realtor this weekend and her position was that prices were “levelling” off to single digit appreciation. She wanted me to get pre-approved even after I told her I was just not interested in buying at these prices. She persisted with the rote RE line of propoganda and I could take it no longer and I just listed my reasons for not buying now. Her reply was, “oh gee, are you in finance?” I can only believe from this exchange that she is aware of the bearish points and the validity of those points and despite that continues to urge people to engage in buying by the monthly payment using “sophistcated” loans. I told her we were “in for a haircut”, and it won’t be a flat top.
I also got a call from a friend who was out with an acquaintance who is in RE. He wanted to know if I was interested in a home in Santa Ana for $750k. I could hear the RE schnitzle in the background “huge yard, blah blah, granite, blah blah”. My reply was, “No thank you. I’m not buying at the top”
Some of the open house signs on the main intersection in Westlake Village, CA now have balloons tied to them so they’ll stand out among a growing sea of open house signs. I only noticed because my 2.5 year old cried from her carseat in the back as I drove by, “look daddy, balloons!” It made me wonder: Is the target audience of this tactic operating at a two year old level? Are people really more likely to go to an open house because of the appearance of the sign?