It Just Seemed Like It Was A Never-Ending Boom
The Fresno Bee reports from California. “With the number of unsold houses piling up, builders are offering free pools, backyard landscaping and even window coverings to persuade shoppers to buy their homes. The number of unsold finished houses or homes due to be completed within 30 days in Fresno, Madera, Kings and Tulare counties totaled 472 in May, a whopping 228% increase in a year, said Jonathan Dienhart, for Hanley Wood Market Intelligence.”
“In May, 104 sales, or 20.4%, fell through and were canceled. That compares with a cancellation rate of less than 1% when the real estate boom peaked in 2005, Dienhart said.”
“Dienhart thinks some buyers are waiting for prices to fall, and others couldn’t qualify for financing after lenders tightened requirements. ‘Base prices are trending downward — and think about the incentives on top of that. It is an extremely difficult time for builders,’ he said.”
“The number of unsold or nearly finished houses in the four counties is the highest since the real estate boom ended, but analysts also note a rush of outside builders to the central San Joaquin Valley. Many of them were national companies where production is key.”
“Builders have so much invested, they have to keep going. ‘When the train leaves the station, it’s hard to get it back,’ said Patrick Duffy, a consultant in Sherman Oaks.”
“‘The bad news is that builders are continuing to build despite the fact that supply is exceeding demand,’ Dienhart said. ‘They can’t make money building homes and they can’t make money not building them, so they build them anyway and hope for the market to rebound.’”
The Herald. “Follow the ripple effect of foreclosures, and chances are the rings start at the lower end of the housing market: new subdivisions attractive to young families, and the less expensive neighborhoods in a region.”
“Those areas are often hardest hit by foreclosures because they tend to be where many first-time homebuyers start, said Dan Thomas, a spokesman for the California Association of CPAs.”
“In Monterey County, that’s certainly the case, as default notices climb in pockets of Salinas, Marina, Seaside and Soledad.”
“As home prices soared here in recent years, home-buying got reckless. ‘No longer were people qualifying for loans that perhaps they could afford,’ says Thomas. ‘There were more stated income loans, and without doing any paperwork to back it up, lenders were basically packaging loans pretty much based on people’s assertions that they could qualify.’”
“In the early 2000s, everybody wanted to jump into a home, or a second home, or investing in homes. Many of those buyers overextended themselves. ‘It just seemed like it was a never-ending boom,’ says Thomas.”
“Now that home prices are falling in some areas, stagnating in others, homeowners find themselves losing equity or without any equity left in their homes.”
“‘It’s a terrible situation,’ says agent Bob Hammel. ‘People get wrapped around the axle because the properties are upside down; people owe more than they’re worth today.’”
“Real estate broker Leslie Hill knows of many cases where homeowners are struggling to hold onto their homes as loan payments rise steeply. ‘A lot of people are saying there are no innocent parties here,’ said Hill, ‘but all of a sudden they’re getting a mortgage payment for $5,000 a month, and they only make $3,000.’”
“Some Seaside Highlands homes purchased for over $1 million a few years ago have depreciated to $700,000. In Creekbridge, houses whose values approached $700,000 last year are being priced at $500,000, even $480,000. A house appraised in Las Palmas a few years ago for $900,000 might now sell for $750,000, according to Hill, after competing with five other houses on the same block.”
“It’s not just first-time homebuyers who have gotten into trouble. Hill has seen cases where people started out with a good, manageable home loan, then started using their house like an ATM. Even longtime homeowners who owed little refinanced, sometimes with drastic consequences.”
“Now they’re in a position where their last loan was an option ARM and with no equity left, and they’re stuck with it. ‘These are people who make a good living, they pay their bills,’ she said. ‘It’s really sad.’”
“Some buyers, frustrated by houses that won’t sell, are turning them into rentals, said Gloria Moore, whose Salinas realty company handles more property management these days than home sales.”
“She predicts that the next round of foreclosures will affect more established homeowners, those at higher income levels who may have more resources to tap, and cause a small exodus as former homeowners leave the county’s high-priced market.”
“But the real question, she asks, is what the banks are going to do with all those reclaimed homes, and what impact their pricing levels will have on the real estate market.”
“‘The debt on some properties is so far above what the properties are worth,’ she said, ’so the question is, how much is the bank going to want to absorb in their ability to get rid of the property?’”
The Press Enterprise. “An Irvine-based housing developer has decided to back out of the project to build hundreds of new homes and office space on 103 acres in north Fontana. Trumark had spent the past two years working on the project. The company’s decision underscores the effects of the crippled housing market in Southern California.”
“‘When they started pursing this project, the housing market was in a bit better position,’ said Councilwoman Janice Rutherford.”
“Redlands-based economist John Husing said many residential builders have abandoned housing projects ‘until they figure out what this market is going to do.’”
“For Karen Fletcher and other vector-control officials across the Inland region, it’s like a rite of passage each summer: the battle to keep the mosquitoes that carry the West Nile virus at bay.”
“And this summer is especially worrisome. With home foreclosures on the rise, the odds of finding a vacant home with a pool breeding mosquitoes are increasing, said Fletcher, a mosquito-control technician with the Riverside County Department of Environmental Health.”
“Riverside County ranks fourth in the state in home foreclosures this year, and Murrieta has one of the highest rates in the county. Fletcher in past years might have monitored the pools on about 10 foreclosed homes each summer. Now, she estimates the number tops 60, including the one treated recently in Murrieta.”
“Riverside County recorded 4,550 foreclosures in May; San Bernardino County had 3,633 ‘They are very easy to be seen,’ Fletcher said. ‘I look for houses with brown grass.’”
The Santa Cruz Sentinel. “As home sales slow around the county, real estate agents and would-be sellers are not the only ones taking a hit. Local governments are not seeing that revenue stream grow as quickly as they used to.”
“As the county housing market turns from a seller’s to a buyer’s affair, the growth of property taxes collected across Santa Cruz County went from 10.6 percent last fiscal year to an estimated 3 percent in the year that ended June 30, according to county Treasurer/Tax Collector Fred Keeley.”
“Government leaders can no longer base spending on the rosy projections that came with the hot real estate markets of the past. And if the market continues to slow, revenues could eventually begin to decline, although experts say that scenario is unlikely.”
“‘We’re a lagging indicator of what the real estate market is doing,’ Keeley said.”
“Mike Coleman, fiscal policy adviser with the League of California Cities, said Santa Cruz County’s slowdown in property tax revenue was one of the most dramatic in the state.”
“‘We do expect a downturn in property tax revenues as a result in the decline in the housing market, but not this soon and not that steep,’ Coleman said.”
Speaking of free upgrades, I was very curious to observe the abject stupidity of 2005-2006 vintage jumbo mortgage buyers. There were three 1.8 million houses in finished exteriors — offered with the buyers choice of interiors and exterior paint, tiles, flooring, etc. No takers. Once they were finished, the morons lined up to have their choices made for them. Why were buyers so unimaginative? These morons fueled the bubble because they made flipping easy. They couldn’t even place a value on having their own choices of interiors.
Who cares about upgrades, I just want an affordable house. I do not need anything flashy that just wastes tens of thousands. Save your “incentives” and slash prices instead
They are trying to follow the car maker playbook. Load up the car with thousands of dollars of options that probably only cost 20% of what the customer is charged. Then, when sales are slow you throw them in as freebies “worth” thousands of dollars. It amazing how much (percentage wise) the price of a new car can be jacked up by loading it up with options of questionable value.
This is why I will pay very little extra for all those nearly useless upgrades. I don’t even want a pool and probably won’t even consider a house that has a pool because a pool is a money pit(lots of maintainence for something ill never use)
GM’s profit margin on the Chevy Tahoe was $15k.
And they are still going bankrupt!
work union, amerika! {/sarcasm}
Light trucks are the only thing keeping the Big Three even marginally solvent. They just can’t compete with non-unionized Japanese manufacturers on passenger cars where the profit margin is smaller, and gets swallowed up by the estimated $1,500 in elevated labor costs they have to pay and the Japanese companies don’t.
(And as obscene as executive compensation is — please. It’s a drop in the bucket compared to the industries’ overall expenses. Even if GM’s executives worked for free — and you get what you pay for — it wouldn’t make more than a marginal difference on the huge hole they’re in.)
Now we have Congress preparing to raise CAFE standards to levels that, as a practical matter, will abolish the light truck. (There’s simply no way, hybrid or not, to make a Tahoe get 35 mpg.) That will be the final nail in the American automotive industry’s coffin. Domo arigato, Congressfolks.
To me GM’s problem (and the other two) is that they don’t offer a competitive product to the Toyotas, Hondas, etc. My father-in-law used to make fun of our Subarus, but the cost of repairs on his Chevy Blazer is just staggering. Any my Subaru is made in Indiana!
They know it’s not in your best interest. They’re trying anything they can to keep prices up. You think people are going to just go ahead and ruin the mirage of real estate appreciation? You know how many people’s lives *depend* on it?! You know and I know things are overpriced - but there are a whooooooooooole bunch of other people that don’t…
http://tinyurl.com/c5edk
‘Base prices are trending downward — and think about the incentives on top of that. It is an extremely difficult time for builders,’ he said.”
I disagree. While builders that were dumb enough to load up on land at or near the bubble’s peak (2005) must deal with land-option write-downs, they all had enormous profit margins and can easily afford to absorb significant price cuts. I bet most builders could cut nominal prices close to 50% and still turn a profit (though they would never admit this publicly). Oh, and add to that the fact that most of their “employees” are of the undocumented variety and simply will melt away into the background with nary a whimper.
OTH, your typical option-ARM’d peak-price FB is the one who is truly facing “difficult times”, as s/he cannot compete on price and cannot afford to sell at current market price without bringing *a lot* of money to the table at the short-sale closing.
Builder’s margins are nowhere near that big. More like 10% pretax.
When homebuilders buy land, they price it so that they have a 10% margin based on the then current prices.
Most developments take a few years to build out (maybe more if a master planned community).
So, if the home builder has inventory that they optioned in 2001, and are still selling houses on it in 2007, you may very well be right, that they can sell those houses for 50% less, and still make a profit.
However, the land they optioned/purchased in 2001 is finite (since builders didn’t like to keep a lot of land on the books). So, once all the 2001 land has been built on, all they have left is the 2002, etc.
The 2005 land will be a nightmare. They absolutely could not make a profit on 2005 land by any stretch of the imagination if nominal values dropped on this by 50%.
Imagine if your business was that you could buy $1MM of Cisco stock with 80% leverage at 10% below current market value, but were contractually obligated to sell 20% of anything you purchased in each of years 3, 4, 5, 6 and 7 at market price.
You were looking like an absolute genius even for a little while after the bubble popped, as you were still making some profit on the earlier purchases. But once the sales of that cheaper stock ran out, you were completely screwed…
Same story with the homebuilders. Their cheap stock is running out, and many will be in the red for years until all of their land purchases prior tx 200x (2008? 2009?) have been sold through the construction of housing.
Many homebuilders won’t be able to withstand this many years of red ink. They are in worse shape than you think medium term. Short term, maybe not so bad. If 2007 sucked, 2008 is going to REALLY suck.
My wife worked for two home builders in the 2003 to 2007 time frame in So. Calif. and let me tell you that their cost to break even was $65 to $70 per SQF. without the land.
I did work for these developers and during the boom times they were in such a hurry to build and sell ASAP that they did not care how much they paid as long as you got it done yesterday.
A by-product of this haste was a lot of mistakes and errors were made. But that did not matter because sale prices were going up every week. The stories I could tell of the boneheaded goof-ups will make you laugh and then cry about how wrong all of this was.
I bet most builders could cut nominal prices close to 50% and still turn a profit
They can in the DC metro.
Exhibit A: New townhouses that sold for $185k in 2000. In same subdivision, equivalent townhouses sold for $450k in 2005. Land was bought in 1995, so even with higher material and labor costs in 2005, it’s obvious that they could have sold the new 2005 units for nearly half as much and still yielded a similar inflation-adjusted profit as in 2000.
I have a friend who is the project manager for a large home development in Lake Elsinore, CA. His company purchased the land and began entitling it for home building in late 2004. When they finally received approval to build the project in the fall of 2005, they were faced with a 13 month grading process and were required by the city to build an 18 hole golf course and club house which will be given to the city upon completion.
They now have the infrastructure in (sewer, water, storm drains, utilities) and have begun building the golf course and club house. The house pads are graded and streets are in. Last time I went by the development, they had not yet built even a single model home. With all of the associated costs for developing the land to build the houses on, they have to sell them in the high $300K range to make any profit at all. Given the state of housing in the area and the location of the development, I don’t know if they will be able to sell even one house for a profit.
I have a goof-up story about Lake Elsinore. We were building a sewer for one developer and half way through putting it in, they told us to stop, go half-way back and turn left instead. The fun part of my job was going to the weekly project meetings and listing in on all the mistakes.
A constant problem was a result of recycling the same model plans over and over again. An example of which is the time a manager copy and pasted a purchase order for an entire phase worth of windows. He reused an older PO the did not match the current version for the timber frame out. ALL THE WINDOWS WERE BIGGER THAN THE FRAME OPENINGS.
Solution: Pay the framer to redo the openings.
builders are offering free pools,
More breeding grounds for the mosquitoes. Keep building boys. No problem here. Just move along. Don’t forget to really sweeten that pool.
http://tinyurl.com/22xmp7
“The Federal Reserve reported Monday that consumer credit rose at an annual rate of 6.4 percent in May, far above the small 1.1 percent gain of April.”
“The increase was propelled by a surge in the category that includes credit cards, which rose at a rate of 9.8 percent in May after having a tiny increase of 0.2 percent in April. The jump in credit card debt was the largest since a 14.5 percent rate of increase in November.”
“David Wyss, chief economist at Standard & Poor’s in New York, said some of the surge in credit card debt reflects the fact that it is getting harder to get home equity loans with banks tightening up on standards and home values not soaring as they did during the housing boom.
“We think that people who had been refinancing their credit card debt into home equity loans are finding that harder to do now,” Wyss said. That would explain part of the big rise in credit card borrowing in May, he said.
Wyss said another factor was a strong gain in retail sales in May, which shot up by 1.4 percent, the largest jump in more than a year, as consumers brushed off rising gasoline prices to storm the malls.”
“But economists believe strength in employment and consumer spending will help provide a stronger performance in the April-June quarter, with many looking for the gross domestic product to expand at a rate of 3.5 percent or even better.”
Yeah, those new “hospitality-” and retail-jobs and credit card spending will ensure continued prosperity….
“Yeah, those new “hospitality-” and retail-jobs and credit card spending will ensure continued prosperity….”
I must agree with you, Tom. I am so sick and tired of reading about how strength in employment is going to save this sinking ship. Crap wage service sector and government jobs are accounting for most of the growth. As the housing bubble implodes then we can expect local government hiring to be cut and/or freeze. Basically, our whole economy seems to be built upon a bunch of lies and fantasies. I think the piper is headed into town and he wants to get paid before the end of ‘07. Thank you Alan Green-scam, you worthless windbag.
I wonder how much is borrowing for mortgage payments, or living expenses? That’s a huge increase. I don’t know how much of the retail sales are on credit, but this seems large to me.
Credit Card Debt is the new ATM machine since refinancing is not an option anymore. How long is the debt party going to last? My guess is: not very long, running out of solutions.
This is the result of robust employment–at stagnant wages at best, and at low hourly wages at worst–as folks run out of options to keep a middle-class lifestyle going. If the housing ATM is done, then using the credit cards is a last resort, before what, bankruptcy? I wonder how many people have borrowed against their 401ks or other retirement funds to hold onto their houses?
The interview with Comptroller Walker on 60 minutes was enlightening…he says everyone in Wash. knows we are heading for disaster…that if we don’t change course, by 2040, we will be unable to fund defense, homeland security, education etc. Just servicing the federal debt and perhaps a few entitlement programs. That’s it. That’s how close to the brink we’re running. How about an honest assessment of our economy and our future…any votes for real leadership from any party?
I work and rent in the DC area. David Walker is very correct, but no one is listening. It isn’t politically expedient to act on Walker’s statements. Walker also says that the drug bill pushed through in this administration is the worst piece of legislation ever perpetrated upon the Ameircan people. Americans were blatantly lied to. We are sheep being led to slaughter. No one cares.
2040? Sounds optimistic to me but he should know I suppose.
The good news is there are well over 100 other countries that may be suitable to squirrel away your wealth before the stormtroopers plunder. 2040 is more than 30 years away. Ironically by that time, the Middle East savage nations of today may be some of the freeest, while the U.S. could go the opposite. Or…we go the way of Brazil in the 1970s and default on our debts. Look now…Brazil is booming. It’s been coming out of its funk slowly. Always remember you are a human first, citizen under a rag on a pole second.
That estimate assumes steady economic growth going forward, which is certainly NOT the case. I expect 2040 will quickly become 2014.
Bankruptcy not. Bush and his [lobbyist] boys finally changed the laws so now credit card/debts are with you tell the end, with very few exceptions. Debt slaves for life paying a little each month with little hope of relief. Easy credit was there for the taking but O, what a price. The banks new greed, first grade math, no common sense, no one left from the first depression to relate too, was the “right” time to lower all lending requirements/standards and get as many as they could to “sign up” now for this easy credit and a hell of a lot did. Pay up time is now as reality sets in. The big boys win again just like they did in the first depression taking the farms, houses, and anything else they wanted. The sting again.
I think families will have to stay under one roof going forward. College graduates will have to move back with the parents to help them pay the bills. Two families might have to occupy one house in order to pay the bills. We (middles class) will all be living like illegal immigrants crammed into homes like sardines. It’s all due to no inflation and a extremely low unemployment.
“The Federal Reserve reported Monday that consumer credit rose at an annual rate of 6.4 percent in May, far above the small 1.1 percent gain of April.”
Is it naive of me to conjecture that the longest streak of negative national savings rates since the Great Depression continued unabated through the month of May? Party on, Wall Street! The Day of Reckoning will not come around until maybe 2040 (according to David Walker…).
A lot of people are saying there are no innocent parties here,’ said Hill, ‘but all of a sudden they’re getting a mortgage payment for $5,000 a month, and they only make $3,000.’”
“Some Seaside Highlands homes purchased for over $1 million a few years ago have depreciated to $700,000. In Creekbridge, houses whose values approached $700,000 last year are being priced at $500,000, even $480,000.
Please don’t tell me we are already at the 30% haircut? These people making $3000 a month really knew deep down inside they couldn’t truly afford a $500 K and up POS. They were as caught up in the greed like everyone else. Now they are the ones with their pants down. Were they forced to sign by some thug holding a gun to their head? No. Now it is time to pay the piper. And I am all for the authorities going after the crooked realtors, MBs, etc.
piper = uncle Sammy,
course that tax bill on the 1099 for debt forgivness is gonna have to be financed as well…. good luck with that on the 3k a month income.
I’ve driven through Seaside Highlands and it’s comical:
1. Same model house listed at $850K down the street from one that’s $1.1M.
2. Lots of “Rent OR Buy” signs out.
3. The Flipper Corner (least desireable streets near the main entrace) had 25% or 30% of the houses for sale, while the quieter parts of the subdivision had none.
They’re overstating the price drops, but you’re right that prices are all over the map. Seaside Highlands hit the market right at the peak of the boom in 2005 so the buyers had lots of sketchy financing to choose from. A lot of them are still listed at around $1.1 million, and there are about 15 on the market out of a total subdivision size of about 250 or so. Several have hit the foreclosure market or are in default. I count at least six in foreclosure or pre-foreclosure at foreclosure.com today.
Houses don’t go down in value in Monterey county. At least, that is what my friends the FBs said in early 2006 when they mortgaged 95% of a $750K 1200 square foot house in Carmel Valley, just east of Monterey.
“Some Seaside Highlands homes purchased for over $1 million a few years ago have depreciated to $700,000. In Creekbridge, houses whose values approached $700,000 last year are being priced at $500,000, even $480,000. A house appraised in Las Palmas a few years ago for $900,000 might now sell for $750,000, according to Hill, after competing with five other houses on the same block.”
Prices already 30% off the peak and this is just the tip of the iceberg. I am betting those formerly million dollar homes will probably end up around a third million($333k) at the bottom. California has some of the most inflated and least affordable housing so naturally the most severe drops are to be expected
Just think, prices have to rise 43% for them to break even.
They will just walk away and let the bank foreclose. Of course they ruin their credit and the IRS is comming for a visit
I see these houses every weekend. Large McM style boxes clumped together in a small area. The remainder of the town is old crappy housing left over from when the military was operating Fort Ord. They do have a Costco and protested having WalMart come in. Anyone passing through that likes donuts needs to stop in at Red’s for one of the best donuts I’ve had since the ’50’s.
Salinasron,
I used to live in Monterey. What is your prediction for places like Carmel Valley? As mentioned in my post above, $750K for 1200 square feet in early 2006. 2012 value: 250K? 300K?
Actually, Carmel Vally (Monterey, not the other one in San Diego) is a highly desirable “wannabe Napa wine country” zip code and the ultra-wealthy locals keep growth to a bare minimum. It’s mostly inhabited by retirees, a few long-term ranch/farm owners, and some redneck hicks way up in the back corners.
I don’t foresee anything close to a 50% drop in that area, more likely 20%-25% then a long period of stagnation.
Sacramento is rapidly depriciating. I just looked at a house the went for $735,000 in April, 2006. Just reduced (again) to $499,000 by the foreclosing lender. 32% reduction on a 3600 SF house. Now at $142/SF. Premium view lot on open space. Some greater fool went under contract last week for more money on a house around the corner facing the power lines.
Anyone buying in 2007 is the new FB. Until foreclosures stop accelerating (2009?) the prices will continue to drop. Countrywide drops their prices 5-10% every few weeks. If you don’t like the price today, wait a month and get 20% off! Don’t believe me? Go to
http://www.streamfx.com/CW/6-29-2007/REO-California.html
and check it out yourself.
Got a link to Wells Fargo REOs?
Why certainly. Wells’ REO site is here:
http://www.premierereo.com/reo/consumerSvlt//nav/ConsumerNavL1.jsp/requestPage/consumer/PropertySearch.jsp
They are going to get stuck with a lot of houses as they walk the market down. I have seen Countrywide sell one house in the last 3 months, yet I have not seen Wells sell any.
There are a lot of REO lenders that are in tune with the market and will be losing a lot of money in the next 2 years.
To the tune of
Achy, Breaky Heart (with apologies to any that have talent to have to read this)
You can tell the bank, I have no one to thank
You can give my broker, my loan
O! But you must tell your friends just what a fool I’ve been
as they repossess and take away my home.
You can sell my ARM to a CDO at Blackstone
You can force my feet right out the door
O! But you must tell my Sis, to tell my kids this
They won’t be living here no more
But don’t tell my tenants, my cocky dorky tenants
I am afraid that they would understand
should you tell my tenants, my cocky, dorky tenants
they might stop paying rent to this man.
Ooo
etc.
I hated that song when it came out and today I have involuntary memory - blech.
“People getting wrapped around the axle…..”
very descriptive
It’s what happens after they get wrapped around the ankle that really gets descriptive.
Oops — I misread “ankle” instead of “axle”…
Oh, the problem is where that axle goes next…
Got popcorn?
Neil
“Who needs stinkin’ credit? And who is the IRS?” — says Pablo, the former US strawberry picker, as he abandons the formerly $1M house that was appraised at $375. I just pawned all of the crap I could rip out of the house. I’m aheddin for Sout of the Border and back to Mexico now.
Ah…gee, aint that too bad. People who who have been using their houses as ATM’s are now having to pay-up…and they’re having trouble doing it. Cry me a river when they repossess your Expedition or you plasma screen TV burns out.
I saw a listing for a 4 bedroom in Livermore CA(outskirts of the Bay Area) that after 47 no offer in the coffer days on the market get dropped from $674,000 to $592,000. It sold in one day after that. Still too high for my liking but somebody thought different. Talk about blowing the neighborhood comps!
And we’re still in the early stages of the meltdown…give it the remainder of this bad summer selling season and another lackluster spring to really get the poop flying and the prices dropping..(it used to be the opposite until July of 2005)
They called me Chicken Little….now I’m Nostradamus.
“I saw a listing for a 4 bedroom in Livermore CA(outskirts of the Bay Area) that after 47 no offer in the coffer days on the market get dropped from $674,000 to $592,000. It sold in one day after that. Still too high for my liking but somebody thought different. Talk about blowing the neighborhood comps!”
I call that progress. Do people research the comps? No one will pay that price now. I bet the next one to sell will be $547k and the one after may be $498k. Fair price is probably around $250k so all those fools who bought at $500k thinking what a deal they got will be licking their wounds and many of them foreclosed as they just walk away and buy elsewhere.
Part of the problem is the level of innumeracy in our general population. Large numbers get to the point where they have no meaning. Really what is the difference? 500K 700K a Mil? Most simply cannot associate the number with the consequence.
But, the banks can!
500K $ U.S currency is a whole darn lot of money to me if you have to save it dollar by dollar. Perhaps these candidates for the Darwin-Award have never actually saved a dollar by themselves in their entire ignorant lives. Thus they have no respect for the importance of the dollar.
That’s what I used to think about my complex (in Fremont, CA) but I was in for a rude awakening. Small complex, houses are 4 BR, roughly 2000 sq ft. “Peak price” of 810k early last year. Early this year 3 houses sold for around 750-760k which was around or below asking. Great, I thought, it’s finally happening here. This Summer? 2 similar houses, asking 800k and 825k. Both sell for 800k. I give up. WTF?
“They called me Chicken Little….now I’m Nostradamus.”
Thank for the laugh!
Still, $592k for a home in Livermore…yeeeeccck. Isn’t that some bedroom community of the Bay Area? Sounds like Gilroy without the garlic.
It’s like Gilroy but with the Lawrence Livermore / Sandia National Labratory. Edward Teller’s old playground…where the Hydrogen Bomb was invented..
But you can hop on BART to work in SF (but not SJ - no BART).
But BART is an hour each way and $4.25 to the first stop in the city and with traffic on 580 it’s at least a half-hour each way to BART. So you’re still looking at a 3 to 3.5 hour commute.
Livermore is home to some wanna-be important Wineries and the Lawrence Livermore / Sandia National Labratory….Edward Teller’s playground…home of the Hydrodgen Bomb and other such things.
Livermore in smack dab in the middle of the worst commute in the bay area. Plus, it’s over the hill from the ocean so it’s VERY hot and dry. On the other hand, there are 10,000s who commute an extra hour from Tracy or whatnot and pass Livermore every day.
Thank the I-got-mine-you-go-away “environmentalists” for San Fran and San Jose for all that commuter C02 in the atmosphere.
Thank you for pointing out something I have been saying for awhile now. All of these we have to protect the open space environmentalist are actually causing more pollution in the greatest open space we have, the sky, by forcing all of these people to commute great distances.
It is very ironic how a group of selfish shortsighted NIMBY’s actually cause more harm than good.
Not that I necessarily disagree with your point, but howzabout we spit out fewer kids?
Either that or force new (legal) immigrants to live in Nebraska/Kansas/Iowa. Pay your dues in the heartland and maybe we’ll green light a move to the coasts.
IMO, it’s a population problem, not a NIMBY problem.
Actually, more protection of open space would force development in urban centers, building up, not out–making mass transit more economical, etc.
The bigger problem is the combination of environmental opposition, development process slowdown, and NIMBYism. It’s made the process more expensive (pushing development to cheaper land), has reduced supply (even though there is a glut, there is far less than there could have been), and stopped urban density increases (other than places that are already very densely populated).
And don’t counter with the ridiculousness of Miami and San Diego. I’m talking about grass roots change. These density decisions happen on a very small scale, over and over again–making a big difference overall.
One small example: There was a developable piece of land in mid-peninsula town in the SF Bay Area, near a Cal-Train station (rail that goes from San Jose to San Francisco). One developer I know wanted to build higher density apartments–close to transit, can walk to the downtown for groceries, restuarants, etc. From a CalTrain station, you can get to SF, Palo Alto, Menlo Park, Mountain View, Santa Clara, San Jose, etc. His thought was there would be less cars on the road for the growth that this could give local businesses. They found that there was too much political opposition, so didn’t pursue the deal. So, what was developed was much lower density, high end condos–what the people wanted.
This could have been 3-5x the number of housing units developed close to existing services, and, while not slums, would have been affordable to many of the workers for Silicon Valley companies. Instead, all those marginal bodies now need to commute from somewhere NOT close to a train station (they are generally forced to drive).
It’s very frustrating to watch these kind of things happen. Just having that development being different (hell, even higher density condo project would have worked), would have saved a subdivision in the outskirts. Multiply that times every project beaten down on density, and you get a lot less sprawl.
The problem with so-called “smart growth” — building high-density housing near public transportation hubs — is that people don’t seem to act smartly enough. Los Angeles, in particular, is finding that its experiment in building high-density housing near public transportation is causing massive congestion on the street infrastructure. The problem is that while people may use a good public-transit system to commute, not all their traveling is commuting. You’ve got trips to the store, to entertainment, to socialize, etc., and public transit simply can’t you everywhere. So even if you optimize public transit, increased density will typically increase congestion in the immediate area of the newly-densified housing.
Re: “howzabout we spit out fewer kids?” — whaddaya mean “we,” paleface?
Yeah. I wish we’d get rid of the enviros so we could house all 35 million of us in 50 story high-rise condos on the beach. We could all enjoy the California dream Manhattan-style, all within one mile of the coast.
wow thats the best idea evar!
and you could walk/bike to work.
however it would turn into hell after 10 years like NY since when renters outnumber owners they ALWAYS pass rent control laws. Then new building of apts/condos stops. Then rent for non rent controlled skyrockets due to no more building apartments/condos.
you cant win in CA
I think most environmental heroes are into new urbanism now:
PBS New Urbanism Report
http://www.pbs.org/newshour/newurbanism/
New Urbanism.Org
“‘The debt on some properties is so far above what the properties are worth,’ she said, ’so the question is, how much is the bank going to want to absorb in their ability to get rid of the property?’”
uhh, that’s really not a question is it. The bank, like every other seller, can only get what the market will pay for the house and will HAVE to absorb the difference.
‘They can’t make money building homes and they can’t make money not building them, so they build them anyway and hope for the market to rebound.’
You can wish in this hand and sh!t in the other, and see which one fills up the fastest.
Uh….which hand has the wish in it? What if you wished you had a hand full of sh!t?
Nevermind…I figured it out myself…..you’d be a Realtor.
“In May, 104 sales, or 20.4%, fell through and were canceled. That compares with a cancellation rate of less than 1% when the real estate boom peaked in 2005, Dienhart said. Dienhart thinks some buyers are waiting for prices to fall, and others couldn’t qualify for financing after lenders tightened requirements.”
This is the trend everywhere. While it’s been slow to materialize, lenders really are tightening up. Pre-approval means nothing, as my lender was telling me that applications are double and triple checked before being funded. I imagine it is getting harder and harder each day.
A little about my experience in the current lending environment:
I am a prime borrower. I made an under market offer which was accepted on a fixer on acreage in rural Western WA. While I think it’s considerably premature for most people to purchase right now, the numbers work for me, and the property is one which I will use for my business as well as my home. Lenders are scared of fixers right now, for obvious reasons. They don’t want to be left holding the bag on a property which needs work. This makes mine a difficult transaction. Not only have they gone over my application with a fine toothed comb, they are much more picky with the appraiser, and have pushed the closing back two weeks in order to be thorough. I’m not too bothered, but I can see that they are covering all of their bases to make sure I’m a good bet. This is with a 20% cash downpayment. Assuming we close, the good news is, after repairs, I should be in a 35% equity position, conservatively. More deals are coming down the pipeline everyday. I recently found a fixer on 25 acres for an unbelievable price. To be honest, if it weren’t for my business, I would hold off for a while. Those with the most patience will be rewarded with the best properties.
How much is this costing for how big house on how many acres? Do you think you will get approved? If not, this truly will be the nail in the house bubble as very few people will be able to get financing and if you don’t got 20% down, forget it!
ps. have you considered renting and wait for prices to drop more?
The price is $140k. The house is 1650 square feet (1930’s farmhouse) on a shy 3 acres (a tad smaller than I wanted but the price is definitely right). I don’t have a problem with getting approved, it’s the property which is hard to finance. If it weren’t a fixer, there would be no issue. I need to rehab it, have it inspected, then it rolls into a 30 year fixed. I am NOT a flipper. I intend to use this for my business as well as my home. I have been renting for over a year, waiting for prices to drop, but I have been checking new listings every day. This is a property which has fallen out of escrow before, and had a series of price reductions. My accepted offer was $20k below the last reduction. I firmly believe prices will drop much further, however I can easily afford this place, and I am looking at the long haul. The property is in an area with a significant amount of raw land adjacent, so I have room to expand should I choose to. It’s almost too good to be true, really. In the back of my mind, I sometimes wonder if the owners might back out before closing.
BB - Say it ain’t so! I cannot believe my eyes…
If/when I close, I’ll share all the numbers, etc.
where did my reply go? I was wondering how much your paying and what if you can’t get financed? This will kill the bubble then.
” I made an under market offer which was accepted on a fixer on acreage in rural Western WA”
Sounds to me like you made an offer exactly at the market value, as determined by both you and the seller. Good luck.
“This is with a 20% cash downpayment. Assuming we close, the good news is, after repairs, I should be in a 35% equity position, conservatively.”
So you put down 20%, spend 30% on repairs, and then you’ll have a 35% equity position? Nice math.
Who said he was spending 30% on repairs?
Pardon me Einstein, but where am I spending 30% on repairs? I’m no math professor, but I think you’ve misinterpreted what I said, perhaps because I wasn’t quite clear.
Sales price $140k
Repairs = $20k
After rehab appraisal = $215k
Considering closing costs (~$7000), my 35% does seem to be conservative.
Like appraisals mean anything? You pay a market price of 140K, spend 20K more, and think the place is going to be worth 215K? In a declining market?
Want to audition for “Flip This House”?
You know, it’s funny, I was a bit hesitant to even share the purchase on this blog because of haters like you. But the fact is, as prices fall, many here will be purchasing. I’ve said all along, that I won’t wait for the bottom because of my situation. I’m waiting for something I can easily afford. I could honestly care less where the price goes. I fully anticipate them going down much further. But I will have a decent cushion. Assuming a 50% drop, I’d still have enough cash to bring to the table to sell, if I needed to. I’m purchasing for the utilitarian value of the house and land. I’m not flipping the house. I plan on running my nursery business out of there indefinitely, adding to the acreage down the road. I’m probably wasting my time even responding to you because all you’re full of is hot air.
Why buy when you can rent at 1/3 the price and be free???
I don’t get… those idiots who want to “own” yet you still have to pay real estate tax and be at the whim of a homeowner ass-otiation.
YOU NEVER EVER OWN…. I own a pencil, I own even a car, but a house… it can be taken from you and is a liability when some dude decides to sue you for your asset, especially in sue-me state Cali.
BB-
Thanks for sharing, at the end of the day if it works for you that’s all that matters. I do have one question, however… where in the hell can you buy a 1600 sqft house on 3 acres for 135k? Fixer or no fixer sounds like a bargain too me.
“But the fact is, as prices fall, many here will be purchasing.”
This is true, as everyone’s situation and location is different.
All the best to you in your decision.
I agree — BB, sounds like you’re doing just fine. Good luck!
“I do have one question, however… where in the hell can you buy a 1600 sqft house on 3 acres for 135k? Fixer or no fixer sounds like a bargain too me.”
That’s the thing mrincomestream, it’s next to impossible. Trailers on land have been selling for more than $200k. This particular house is outside of Olympia, WA. It’s a nice quiet rural area, with farms and such, and away from any of the riff raff. Raw land alone is selling for a minimum $20k per acre, oftentimes much more.
Wow… That sounds nice. Well again it sounds like a deal to me especially when folks are selling 2000 sqft lots with shotgun shack fixers on them for 245k in my area. So don’t let the naysayers get you down and keep us updated on how your deal goes. I mean in honesty how much cheaper does one expect to get a house with 3 acres on it?, especially if it has indoor plumbing, I mean it does have indoor plumbing doesn’t it?. The payments at todays rates are probably real reasonable. I think that deal is a winner.
And then you follow up this post with:
“I fully anticipate them going down much further.”
In other words, you’re full of it and you know it. But good luck to you when you’re upside down.
No, I think you’re full of it. The numbers make sense from a business standpoint. The green monster is getting the best of you. It’s evident in your reading comprehension, or lack of it.
The green-eyed monster.
Yeah, the green-eyed monster of envy over a F’ing trailer! LOL.
It’s simple, dwr— if he can afford it, and it’s the kind of thing he wants, it doesn’t matter if prices go down over the next few years. Real estate does only go up— over the long term. If he’s in it for the long term (seven to ten years, at least) then he’ll do okay.
I have a friend who bought a mobile home and the land below it for more than I would ever pay, but it was exactly what she wanted and she’s the sort of person who is going to live there for the next thirty years*, and she can afford the payment, so who am I to worry about her?
*Teacher with tenure, and a very… um… non-change lifestyle.
“To be honest, if it weren’t for my business, I would hold off for a while.”
so, you didn’t just break ranks .. you’ve got good reason to buy now?
nevermind.. i was late in posting.. i see the nursery comment.
‘These are people who make a good living, they pay their bills,’ she said. ‘It’s really sad.’”
They make a good living, yes - but not enough to afford that house to begin with…that would be called making an excellent living
And they’re learning the downside of leverage.
Yeah, all they did was live WAY above their means for the last 6+ years. It’s so sad.
“Mike Coleman, fiscal policy adviser with the League of California Cities, said Santa Cruz County’s slowdown in property tax revenue was one of the most dramatic in the state.”
Good, now they can raise taxes on all those uber-liberals in Santa Cruz. They don’t mind paying taxes in their socialist haven.
Leo Nordine a REO Broker was interviewed by a the LaLand Blog today. He’s one of if not the best Broker in SoCal.
Highlights:
L.A. down 30% in 2 years
R.E.O. Managers in India
LAIG you may want to take a read or drop by Leo’s office for some perspective.
http://tinyurl.com/2ske4m
While I’m not familiar with him (I’m not in the biz, so I don’t know the players), I’ll take your word that he is very good. 30% down in 2 years in LA is a pretty bold prediction, considering how sticky prices have been there so far. I guess the only thing I question about his prediction is whether it will bottom as quickly as he thinks it will. Based on the Credit Suisse ARM re-set chart, I’m thinking that it might take longer, but my crystal ball probably isn’t as good as his is. So, we’ll just have to see how long this takes to play out.
He’s been in the game at least 20 yrs, primarily selling foreclosed or investor owned property. He’s on the frontline and in the trenches. If he’s telling you 30% in 2 years you can believe it. As a matter of fact I’d venture to say you can put money on it. It just goes to show the banks are breathing hard and the orders to unload at will have already been passed down. There are no other Broker’s in Los Angeles who have his insight. None…
I did a search on him and it looks like he bought up half of SoCal between 1997 and 2001 and owns approx. 50 properties today.
The majority of which are multi-family and commercial if I’m not mistaken. I’ll be the first to raise my hand and say he wasn’t the only one… Who benefitted from the last dip.
I dont think the prices are as sticky as you guys think in SoCal. I live in Glendale (about 5 miles to about everything to do in the Los Angeles area), and some of the flipper houses that were over $1mil have dropped $300k and are still sitting. There are a lot of places that are just sitting since last summer. Actually one horrible little condo I saw last summer that sold around $410k and now its sitting for $339k. So I definately am seeing prices dropping more than I thought pretty quickly. Within the last couple of months. I am finally starting to see very small houses in Pasadena listed for under $450k, which was unheard of last summer to find a condo with attached garage for that price in a similiar area.
I’m also looking in Glendale/La Canada/Pasadena area. I can see the rollbacks coming in from the IE like a blob. The return to normal will slowly crawl through from the outskirts and I think hit this part by 2012. At least I hope it takes that long. But since we are talking about your typical american consumer it will most likely turn into a tsunami and smack prices in a lot less time.
foreclosure.com has very scary stats for those areas. Glendale has over 1200 with tax liens, foreclosure, etc. listed. Pasadena is almost close to 1000. And yes everyone is still driving around in their super expensive cars. Main car of thieves in Glendale are BMW’s now.
“The market will bottom out in two years,” he said. “Save your money. Then the banks will be underpricing everything. That’s when you want to buy.”
Ya know… I like what this guy is saying. Ok, we can argue details (timeframe, percent of drop…). But if more of this was printed in the MSM, I’d be happy. (Did it make the dead tree edition?)
And I like how he’s telling the REO sellers to get the price down!
:)
Got popcorn?
Neil
but I don’t want to wait two years!!
slap me. hard.
harder. HARDER.
AGAIN!!
OK OK stop!
whew.
This is another thing that baffles me about all this, the only reason why the reporter even bothered to interview Nordine was because people on his blog suggested he was a top notch guy. You have to ask yourself why hasn’t the MSM been a little more diligent in finding real experts of the industry. Front line guys who are doing the real business not just moron’s who sit around all day and shine seats with their collective a$$es and present themselves as experts, kind of makes you wonder.
Oh, they do… They seek out the “top producers” in hot areas… The “soft landing”, “westside is immune” kinda people. Did you catch the article last week about the boom in “high end” sales? Sickening…
Yea, the one with the 125 million dollar house for sale. That amounted to nothing more than a press release for lunatics.
LOL
The sad thing is, people who recently paid +/- 1.5 mil for a 3/2 near the grove think they’re in that category. As do the other westside sellers/realtors listing for 500k more than they paid 1 or 2 years ago… :-/
Those people are insane…
I was recently on jury duty and people in the deliberation were asking if we had ever seen how nice the places around the Grove were. I must have looked like a virus when I mentioned how I thought what an awful neighborhood that was located in. I couldnt stop thinking how junky everything over there is. And then the lawyers kept calling everything Beverly Hills adjacent to say how one of the properties was worth so much. I really hate that term and anyone who thinks everything surrounding nice areas is a nice area means that Fontana is a great area because it borders a border of a border, etc. of Beverly Hills.
And an architect actually said she would prefer to live in a condo over a house because its so expensive to pay for upkeep on a house. I asked so that $500 HOA that most condos charge save her money over a house? She said its much easier to just pay a group to mow the lawn and paint the place. Ok i better stop ranting about how stupid this city is.
Hey Mr IS
I have been following this guy’s site for over a year, he used to have a news column, pretty much said the same stuff as people on HBB have been saying, I even suspected he was a poster here.
anyway, I cant find his news link anymore, do you know if he still has it?
No, I don’t know… Call his office
thanks, that was helpful!
LOL @ MMG My apologies… that was an a$$hat response. I was on the phone when I typed it. Sorry…
LOL, no problem, actually I might send him an email, I liked his mini-assessments of the market.
Thanks, I’ve been checking Nordine’s website since 1999. If prices are going down 30%, and I don’t doubt him because he knows his stuff, they sure aren’t yet because he barely has any commercial inventory at the moment. His residential inventory has obviously ballooned, but is still priced really high. 450K for a house in the hood, anybody?
“If prices are going down 30%, and I don’t doubt him because he knows his stuff, they sure aren’t yet because he barely has any commercial inventory at the moment.”
I meant, he barely has any commercial inventory and it’s still way overpriced.
We used Nordine in 1991 to sell our house. We priced too high. The market was falling. He wanted to drop the price. We declined and parted ways. We should have taken his advice. We carried the property for 10 months more before it sold (at a lesser price). Nordine knows his stuff. He’s one of the best out there.
Still, $592k for a home in Livermore…yeeeeccck. Isn’t that some bedroom community of the Bay Area? Sounds like Gilroy without the garlic.
10 years ago, I looked at a lot of houses in Livermore to purchase. They were averaging around $200K at that time. A few were slightly below. Highest one I saw was around $230K. Methinks Livermore (and a whole lot of other places) have a lot of downside room. This house should be $300K tops (and that is being generous). One can take BART, but they have to drive to Dublin/Pleasanton to get there. The 580 fwy (only route closeby) is a parking lot both directions both in the morning and evening. Horrible commute. And I should know, I did it between 2000 to 2005.
(“It’s not just first-time homebuyers who have gotten into trouble. Hill has seen cases where people started out with a good, manageable home loan, then started using their house like an ATM. Even longtime homeowners who owed little refinanced, sometimes with drastic consequences.”
“Now they’re in a position where their last loan was an option ARM and with no equity left, and they’re stuck with it. ‘These are people who make a good living, they pay their bills,’ she said. ‘It’s really sad.’”)
I’m sure there are a lot of people who had affordable loans and got mixed up in the option-arm game. what a sad sorry state of affairs.
“Even longtime homeowners who owed little refinanced, sometimes with drastic consequences.”
That is the sentence that just slays me. Assuming they owed little, they must have bought a decade or so ago. Considering how much prices have risen in that time, what on earth were these people spending “their” money on?? How can you squander that much money?
“How can you squander that much money?”
Easy, by doing their civic duty and propping up this bogus service/consumer economy by buying everything in sight.
iPhones for everyone!
One thing is that, to someone without a sound appreciation and respect for money, it aint all that much money.. a hundred grand.. maybe two? It seems like a lot.
But that amount might support a spending spree like a truely wealthy person could afford to spend, for maybe a year or two?
I mean, 2 nice cars and half of it is burned.. throw in some cosmetic surgery.. which i hope includes at least one boob job (both boobs of course).
‘These are people who make a good living, they pay their bills,’ she said. ‘It’s really sad.’
———————————————————————–
Wrong! What’s really sad is all the regular average families who make a good living, lived responsibly, and never fell for the real estate scams the last several years who are priced out of a home to live in.
“Those areas are often hardest hit by foreclosures because they tend to be where many first-time homebuyers start, said Dan Thomas, a spokesman for the California Association of CPAs.”
ownership has it’s privileges.
“‘The debt on some properties is so far above what the properties are worth,’ she said, ’so the question is, how much is the bank going to want to absorb in their ability to get rid of the property?’”
The bank is not going to WANT to absorb anything, it’s a matter of what they’re going to HAVE TO absorb if they really want to get rid of the property. That is, assuming it’s even a bank that’s holding the property.
I liked this quote even more:
“But the real question, she asks, is what the banks are going to do with all those reclaimed homes, and what impact their pricing levels will have on the real estate market.”
Hmmm, what are the banks going to do with all those reclaimed homes??? Maybe exactly what they’ve done every time this has happened in the past, namely sell them for whatever they can get for them.
Will we see something similar to the Resolution Trust Corporation, or not, because of the difference in where the mortgage money is coming from? (Wall Street as opposed to S&Ls)
Not. RTC was set up because the S&Ls were Federally insured and Uncle Sam was a bagholder. Now the foreclosed houses are owned by MBS holders - many foreign. It’s their haircut. It’s the job of the mortgage servicers to liquidate the properties. Stand back and enjoy the bonfire.
“Some Seaside Highlands homes purchased for over $1 million a few years ago have depreciated to $700,000. In Creekbridge, houses whose values approached $700,000 last year are being priced at $500,000, even $480,000. A house appraised in Las Palmas a few years ago for $900,000 might now sell for $750,000, according to Hill, after competing with five other houses on the same block.”
1) I rent one of those Creekbridge homes for $1500/month. The construction is very poor quality and the neighborhood is around 20% ‘affordable housing’. The streets look like an LA parking lot with multicars in the driveway (4) and another 2-3 parked or squeezed in out in front. Interestingly though are the cars themselves, BMW’s, Mer’s, GM Esq’s, Hum’s, etc (probably all leased). When in BK this past weekend I found that a friend who’d had a Jaguar, Benz SUV,and Lexus were all leases.
2) Las Palmas is a pretty area, all new, gated and located on the far outskirts of Salinas. Probably 5 miles to the nearest grocery store. Being gated means HOA fees which for this development has to be high; when looking at homes in that area two years ago I couldn’t find one RE who could tell me what they were. It is a hilly development with lower priced at the base and huge higher priced properties at the top. I see ads to rent the smaller homes anywhere from $2500/month up. Good luck because I can rent in Monterey or PG or even a small place in Carmel for that. Most of the people buying in that area the snobbish type who want to be from Steinbeck country but don’t want the Salinas image associated with it. Very few jobs here pay well. A lot of people are employed by the prison 30 miles to the south or drive to work in the SJ area. I know of one poor soul who just quit a good paying job here to take a job in Scott’s Valley because he got a $5000/year raise. That will mean, with travel, a 12 day and his raise after taxes will go to gas and a new car. He will no longer be able to go to his kids sport activities, etc.
“I know of one poor soul who just quit a good paying job here to take a job in Scott’s Valley because he got a $5000/year raise. That will mean, with travel, a 12 day and his raise after taxes will go to gas and a new car. He will no longer be able to go to his kids sport activities, etc.”
I don’t understand why people don’t think these things through. $5,000 sounds like a lot of money until an examination of all the factors that you’ve just pointed out.
“Riverside County recorded 4,550 foreclosures in May; San Bernardino County had 3,633.”
Are these NODs or actual foreclosures (i.e., trustee sales)? The article wasn’t too clear. Either way, those seem to be some big numbers.
Thus ends the dream of the North Fontucky Estates…
“An Irvine-based housing developer has decided to back out of the project to build hundreds of new homes and office space on 103 acres in north Fontana. Trumark had spent the past two years working on the project. The company’s decision underscores the effects of the crippled housing market in Southern California.”
Is this the project where they cut a chunk of the mountain out for houses ?
they had already started the rough grading on this project and stopped???? that is truly crazy for them to get that far and stop. We had a huge project get turned down right as it was going from planning to final engineering by the voters, the developer lost over $15mil and had already said they wouldnt fight a loss. But I cant imagine how much money is lost when actually starting to build, if thats the case.
can’t pay the mortgage = no problem
put it on the card
The Federal Reserve reported Monday that consumer credit rose at an annual rate of 6.4 percent in May, far above the small 1.1 percent gain of April.
If you can’t refinance the ATM house, you need to get the money from somewhere else. There was another interesting statistic last week stating that credit card late/missed payments were consirably down.
The debt nation is not as stupid as we may think. People know they need to keep reasonable credit score if they want to get new credit lines and keep the party going a little longer.
Next week on Niteline; Fallout From the Condo Crash. It looks like the first good real in depth story on the housing bust, in the MSM. Reading about it on the blogs, and knowing whats been going on for years is one thing, but seeing people talking about what we already know on TV, is something else. It may be interesting to watch.
Speaking of Nordine, who thinks this is a deal:
http://www.nordine.com/flyers/1207_barcelona.pdf
i love that front porch.
The lot square footage was most impressive, I thought.
LAIG-
You didn’t make an offer on that…?
Nice lot size here, and great neighborhood and schools:
http://www.nordine.com/flyers/1497_152nd.pdf
hmm.. this one has bars on the windows like the other one..
345k LOL if that’s not fraud I have no clue what fraud is…
But have no fear one can always buy this…
http://la.curbed.com/archives/2007/07/las_most_expens.php
It’s only 165M
What’s with the contrails?
Get me the head of the FAA on the phone..
Not that impressive, my listing had better much better curb appeal.
Bantering Bear- that is awesome news about the lenders being so picky over 20% down on 140K with good credit. I knew things were tightening a tiny bit but this indicates that at least *somewhere* in WA., they’re starting to be very careful.
I’m curious what town/county you’re in?
I have no idea wgere this post will end up, New Browser, very funky.
Way OT, but tomorow’s Nightline will feature a whingeing termagant from Miami who’s singing the “We thought we’d be priced out forever” song. Nightline used words like “a condo market that has collapsed”…
Jackson County, Southern Oregon:
“If you think you are seeing more “For Sale” signs on local lawns, you’re not mistaken.
More than 3,000 Jackson County homes are available, according to Southern Oregon Multiple Listing Service, which reported a 20 percent jump in homes on the market as of July 1.
“There are so many homes on the market that you have to be careful with clients, because you can confuse people by showing them too much,” says Rick Chezik of Exit Realty Group in Medford. “You don’t want them to go home with their heads spinning. … Instead of confusing them with 40 different properties, I try to keep it in the range of 10 to 15.”
http://www.mailtribune.com/apps/pbcs.dll/article?AID=/20070710/BIZ/707100301/-1/BIZ03
“because you can confuse people by showing them too much”
Translation - The carting of people around takes away from my ramen allowance
Just noticed he was part of the “EXIT Realty” group. How’s that for a name.