Market Forces Continue To Bleed Value From Homes
The Florida realtors report on July sales. “With positive economic conditions such as low mortgage interest rates and job growth continuing in Florida, statewide sales of existing single-family homes totaled 11,674 in July and were closer to activity in July 2001 and 2002 – before the housing boom years – than the July 2006 figures, when 15,378 homes sold for a 24 percent decrease in the year-to-year comparison, according to the Florida Association of Realtors.”
“Florida’s median sales price for existing single-family homes last month was $237,500; a year ago, it was $250,400 for a 5 percent decrease. In July 2002, the statewide median sales price for single-family homes was $141,700, for an increase of 67.6 percent over the five-year-period, according to FAR records.”
The Herald Tribune. “Market forces continue to bleed value from homes that ran up during the recent housing boom, and nowhere was that more evident during July than in Southwest Florida. Charlotte County-North Port’s median price was 21 percent below July 2006; Sarasota-Bradenton’s was 12 percent below the comparable month last year.”
“After some initial success in flipping lots, Mick Fenn invested heavily, and now has four houses to sell. His home in North Port cost him $137,000. He put $15,000 more into it, not counting sweat equity. The house came in with a juicy looking appraisal of $190,000 in January, but the market has not agreed at all.”
“Fenn recently tried posting huge signs in the yard and on the garage door. One read: ‘Reduced $1,000 a week until sold.’ The city of North Port cracked down on the signs, and Fenn has since turned to more traditional means. ‘I think I can keep my head above water the next 90 days,’ he said. ‘At that point in time, I am going to be in big trouble.’”
“Fenn still likes Southwest Florida. He just wishes he did not own so much of it: ‘I think I got greedy and I think the greed came back to haunt me.’”
“He is in good company. Just in the Sarasota MLS, there were 7,916 single-family homes for sale as of mid-August. With Realtors closing at the rate of 87 homes per week, that is an inventory of about 21 months. In Sarasota’s condominium market, it is worse. There were 4,808 units. Realtors are closing on about 40 per week, leaving a two-year supply.”
“Sales were down 35 percent in Charlotte County-North Port during July when compared with a year ago. Ocala’s sales dropped 55 percent, while Fort Myers-Cape Coral slipped 39 percent. But dragging down the southern market is the large number of speculatively financed homes in North Port, which are now proving difficult to move, said Roger Richmond, a broker associate in Port Charlotte.”
“Typically, a speculator paid to have a three-two with a two-car garage built in North Port for a little more than $200,000, Richmond said. ‘They can now sell it for $180,000,’ he said.”
“‘Homes that sold in the $600,000s to $700,000s market are probably high $400,000s to low $500,000s now,’ said Richmond, citing the Old Grassy Point canal system in Port Charlotte as one neighborhood for such pricing.”
The News Press. “Prices and sales in Lee County were off compared to June: down 7 percent from $264,600 and off 24 percent from 558. It all adds up to a market where it’s hard to sell a house, Kathleen Bressler said. ‘I think there’s just such a saturation of houses for sale because of foreclosures and investment houses that are for sale.’”
“Maggie Morris, an executive committee member with the Florida Association of Realtors, said many people in today’s market are finding themselves having to let go of their properties. ‘I think a lot of people are walking away,’ she said, and that in turn is causing prices to adjust to real market values at last.”
The Ledger. “The number of existing homes sold in July continued Polk County’s housing slide. For the 14th consecutive month, the total was less than the year before. Realtors sold 278 homes last month, down 40 percent when compared to a year ago. Median home prices also fell: 3 percent from July. Lakeland Realtors had 172 home sales in July, down 37 percent from 274 a year ago.”
“‘We are returning to a normal market. People are adjusting their prices. They are realizing they aren’t going to get that pie in the sky price,’ said Tony Fridovich, broker in Lakeland.”
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
The Palm Beach Post. “The median price of an existing single-family home sold in July in Palm Beach County declined 5 percent - the 12th straight month of falling home prices, the Florida group said Monday. In the Treasure Coast, the median price of an existing single-family home fell 11 percent in July - marking 14 straight months of plunging prices.”
“Worse, the inventory of homes for sale continues to grow, especially in Palm Beach County. It’s inventory - the new dirty word in real estate - that has made so many housing analysts bearish on the market.”
“Worse news may lie ahead, some economists say. ‘The July data reflects sales that were agreed to in May or June, well before the severe tightening in credit standards that occurred in July and August,’ said Nigel Gault of Global Insight. ‘It’s hard to see a bottom before mid-2008.’”
The Sun Sentinel. “Three years and counting. Sales of existing homes in Broward County declined in July, just as they have for 36 of the past 37 months. That dismal trend isn’t likely to change soon as lenders across South Florida make it tougher for consumers to qualify for mortgages.”
“Jim Mander still is trying to find a buyer for the four-bedroom Davie house he listed more than a year ago. The property with a pool is set on an acre lot and has been renovated extensively. He originally was asking $789,000, but he’s down to $749,000 and getting frustrated.”
“‘I’ve got a feeling it’s not the house, it’s not the location,’ said Mander. ‘It’s just the market. My timing was wrong.’”
“If he doesn’t sell soon, Mander will try to rent the house. His agent, Debbie Anderson said exasperated sellers are having success as landlords. ‘People have the money to rent expensive homes,’ Anderson said. ‘They just don’t want to pay for them. I think they’re afraid that prices will fall even more.’”
“Home sellers will have to lower expectations from the record high prices during the housing boom of 2000 to 2005. ‘I talk very seriously with my sellers to let go of what was,’ said Cathy Prenner, a real estate agent in Lighthouse Point.”
“Kathy Connors put her five-bedroom Wellington home on the market in January. At the time, she was asking $655,000, a price she now concedes was too high.”
“The manicured property inside the gated Isles at Wellington development has a hot tub, a spiral staircase and a balcony outside the master bedroom. But with no offers and only a handful of prospective buyers stopping by, she has slashed the price to $549,900.”
“‘Just getting people in here has been the problem,’ said Connors.”
“Her new real estate agent, Polly Parker in Boca Raton, said homes that attract little interest probably are overpriced by at least 5 percent. If no buyers step forward, the properties could be overvalued by 10 percent, Parker said.”
“‘Houses sell because of amenities, location and price,’ she said. ‘If you have all three, you’ll sell the house.’”
The News Journal. “After six months of trying to sell her Ormond Beach home, Susan McDaniels is getting scared. Scared that she won’t recoup much of the money she spent on improving the kitchen or the new appliances, among other things.”
“McDaniels said her first instinct was to price her house at $279,000, what a similar house sold for about a year ago. But real estate agents told her that was too high. So she listed it for $229,000. Then she dropped it to $224,000, then to $219,000. As of Monday, the asking price was $209,000.”
“‘And we’re still not showing it. I just have to hope in a month or so that when the snowbirds arrive, we’ll get a bite,’ said McDaniels.”
“Such is the state of local real estate, post-housing boom. Sales have fallen sharply, and now average prices have dropped, too.”
“Broker Greg Antonich said sellers have to compete against the lowest-priced houses on the market in the same category. ‘Buyers are scraping the bottom of the market and coming back to the best price in whatever category’ in which they are looking, Antonich said.”
“‘It’s a tough market,’ broker Sandy Stutz said. Many properties are staying on the market six months or more, she said. She had several such properties, including one on Sunland Road in Daytona Beach. The listing expired recently.”
“‘It’s absolute precious,’ she said of the property. ‘Immaculate, but we just couldn’t get anybody to come inside.’”
From Mrytle Beach Online in South Carolina. “With a forecast of 18 more months of a slow market, real estate agent Cal Harrelson, who specializes in the oceanfront resort home market, has asked all his clients to bring their prices down by 10 percent.”
“‘Chances are that in six months, values are going to be down 10 percent anyway,’ Harrelson said. ‘I told them to do it today and get ahead of all of their competition, get the sale and move on. If they truly want to sell their property, that’s what they need to do because there is so much inventory out there.’”
“‘If they don’t reduce by 10 percent, they along with everybody else are still going to be on the market in six months and probably in two years,’ he said.”
“Harrelson said he…gave his clients the facts and all but one lowered their price. Since that time, he’s had two oceanfront homes sell in the last six weeks priced at more than $1.5 million each. So he thinks it might be a good idea for others.”
“‘There might be something to this. If other Realtors see that and they do that, then more power to them. These sellers need to hear the facts whether they are not so good or not. It’s difficult to tell them you think it’s going to be slow for another 18 months and why,’ said Harrelson, a 13-year real estate veteran and top sales agent in Garden City Beach.”
“It’s also important that homeowners realize that builders’ closing prices do not reflect the amount of incentives they’re offering, said Don Schunk, research economist at Coastal Carolina University.”
“‘What I’m seeing now is that the resale market as we saw in July is starting to come down. If prices get 20 percent or more different, that will encourage the resale market. Builders are starting to look at lowering prices versus the incentive packages,’ said Tom Maeser, president of the Fortune Academy of Real Estate.”
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‘Tallahassee: Facing the worst budget crunch since the 2001 terrorist attacks devastated Florida’s tourist economy, state legislators on Monday were told they might need to slash state spending by more than $2 billion over the next two years.’
‘Florida’s bleak housing market is the culprit, forcing a dramatic drop in state revenues collected through sales taxes and real estate transactions.’
‘State spending has been buoyed in recent years by the state’s housing boom and hard-hitting back-to-back hurricane seasons in 2004 and 2005. The storms caused billions of dollars in damage, but also fueled a rebuilding effort that boosted sales tax collections by billions of extra dollars. ‘It’s either boom or bust,’ said Sen. Gwen Margolis.’
‘Sansom voiced confidence the economic outlook will improve. ‘While it looks gloom and doom right now, I’m not sure it’s going to stay that way … I think the real estate market is on the brink of breaking wide open if insurance and taxes become more affordable,’ he said.’
But if tax revenues are off, wouldn’t that mean no tax cuts?
No, use Bush math.
Was down at the Hyatt Coconut Point for four days and occupancy was in the mid 20% zone, felt like we had the whole hotel to ourselves. I know this is probably a slow time of year but surprised that it was that empty.
When the economy goes bad as I suspect it is now that is one of the fringe benefits, extremely cheap hotel rates and empty eventually slow restaurants that used to be packed. No waiting at restaurants and cheap rates at hotels is heaven to me…of course I am not in the hospitality business so it is easy for me to enjoy the advantages of the decline in business.
If any of you are in the hospitality/restaurant business it would be great if you could post your comments on business from the field.
When the economy goes bad as I suspect it is now that is one of the fringe benefits, extremely cheap hotel rates and empty eventually slow restaurants that used to be packed. No waiting at restaurants and cheap rates at hotels is heaven to me…of course I am not in the hospitality business so it is easy for me to enjoy the advantages of the decline in business.
Vast segments of the US economy are now involved in selling some non-essential, discretionary income product be it a 60″ television, cheap hotel room, or an overpriced restaurant dinner.
Now that the housing ATM is dead, these businesses will begin to drop like flies.
Sold the last of my stock holdings this morning. All cash except energy and precious metals.
For years I’ve been the buy and hold sucker.
Not this time.
Crash comin’…People can’t begin to fanthom how corrupt the US mortgage biz was.
However I guess the Germans have a pretty good understanding now though.
I guess thats the idea behind the “BIG LOVE” program on HBO.
Make paligamy acceptable and turn a 2 income houshold into 4. Just marry more wives.
Breaking wide open? Like in half?
Makes me so angry, all these people want to return to the time when homes were just becoming more and more insanely priced every day. What we are returning to is a normal market. It’s just that normal requires a 50% crash in prices, something no shill anywhere wants to admit.
And also, that normal is home prices increasing right at the rate of inflation; another fact about “normal” that none of the RE idiots want to discuss.
“normal is home prices increasing right at the rate of inflation”
Maybe they have been - have you seen how much food prices have jumped in the last several years. Of course the official government inflation rate that is reported is completely bogus. While home prices have skyrocketed recently and have obviously increased above the inflation rate, I bet the spread isn’t nearly as wide as the government would like you to believe.
Some areas will require a 70% cut, while others require a 10% cut. There are many homes in the Midwest going at 1997 levels if you look on the CountryWide or Fannie websites. These are good homes in good neighborhoods. At the same time, they’re still slapping up McMansions everywhere.
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
When specu-flippers bought numerous properties with no money down, they were “astute investors”.
But today’s buyer who recognizes an opportunity for a sweet deal is “predatory”. How come you’re allowed to be entrepreneurial on the front end but not on the back?
Seriously… real estate people who live on commission who are making all the characterizations, and yet you never see the media calling them out on this, not even a little. For people who live on commission, rising prices are great, and falling prices are terrible, no matter what it means for the buyer, the seller, or the economy as a whole. So 200% increases in price are just dandy, but a fall back by 50% to the mean appreciation over time can only involve “predatory” players.
I get a stomachache thinking about back to back record home price increases being trumpeted as great news and a reason to invest in real estate right-this-second, with no mention of the affordability problems (other than to say “buy now or be priced out forever”) or any possibility that real estate prices could ever fall, while falling real estate prices (and vastly less than they increased, mind you) are now cast as surprising and terrible news, caused by unjust and immoral lowballers that will be the downfall of the economy, amid howling that the establishment should be doing everything possible to prop the market back up.
The fact that the REIC shills are quoted on this stuff every day and almost never, if ever, called out on their commission/transaction cost bias in the MSM should be a wake up call not to believe what you are reading. It is all bought and paid for just like our politicians.
I have to admit that I’ve thrown a few 50%-off-wishing-price offers out there recently but none were accepted- yet. The bottomfisherman lurks…
Let ‘em rot.
Right, but 50% off current asking prices are about right. Why should you and not the current seller absorb that loss?
only an economic girlieman would use a realwhore to sell RE- it’s a snap- I’ve sold and rented sht over the phone w the net
Ha! Girlymen are all over the place. They wear nail polish, wax their chests, use makeup and hair dye and smell like a French brothel. They lift the hood of the car and pass out from fright. Why should economics be any different?
txchick57,
Very funny. Like your style.
Jim,
I really like your post and wish you would send it to CNBC so that they could read it. Please send it. Send it to Diane Orlick because I think she would pay attention to it. I’m serious by the way…
Well, tell your little tummy that most financing tricks recently went ‘poof’, this mess is all getting worse, the REtards are losing what marginal credibility they had, and that these REtard shills you object to will soon be more likely to be quoted thusly:
” Waaah! Boo HOOOOO! (Sniffle).”
See if that makes it feel better.
RE: This mess is getting worse.
A comment from a MarketWatch reader-
IMHO, the little credit “bump” we just felt was the iceberg punching a hole in the Titanic. The Captain is telling every that the problem is contained and is only affecting one small part of the ship.
“The engines are still running strongly. We’re still on course, the band is still playing. See, everything is fine….”
Meanwhile, deep in the bowels of the ship and out of view of the passengers, the crew is working desperately to stem the leak. The ship is filling with water, but the passengers have yet to notice the ship list.
Drinks are still being served at the bar (although the bartender is now checking IDs and charging more), and the passengers continue to party and banter. After all, their jewels are protected in the ship’s safe, no oceanliner of this size has ever sunk, and the band is still playing happy tunes.
Consumer confidence remains high, and the Captain’s staff cites this as strong evidence that the ship is in
Seriously… real estate people who live on commission who are making all the characterizations
Real estate people do not make a living just on commissions received from a home sale. If that were the case they would fall into a poverty level. The more successful realtors make huge profits from buying distressed properties and turning around and selling them to the public. There were many seminars put on by the various RE groups that presented this to realtors starting about 2003 through 2006.
Predatory buying is still early, much to early. If you do not intend to live in the residence it is to soon to place a bid.
That’s right. You won’t be able to get stuff for -50% until they have been foreclosed on, the bank owns them, and the bank is under pressure to liquidate. Right now, I see the banks being as greedy as the FBs in pricing these places.
Same here. Banks seem a little workable if you’re a cash buyer with no contingencies, other than that, they’re asking full retail still. None of the REO departments seem “under pressure” to liquidate. Yet.
Wait until it starts affecting their quarterly numbers and the FDIC decides to make them up reserves, etc. Then you’ll see some movement. Ha ha. I made myself laugh with that one.
So chick, do you think that will happen in one of the remaining ‘07 quarters, or not ’til after the first of the year??
Probably next year. ‘08 should be a doozy.
Excellent…..gives me more time to save, learn and profit…..Thank you!!
Txchick and friends. 08 will be a mess but there is a second wave in the reset chart. Even then a time lag exists so this is going to be a long ride down.
Add the resets, the tighter loans qualifications, and the amount of people already in the FB stage or upside down on their loan and it’s going to be a long, long way to the bottom.
Banks don’t get “Insulted” by lowballs. Banks have no emotional attachment to a home. Banks can see the carpet is frayed, the paint awful and the kitchens and baths out of date. Banks will return your phone calls even if they think the offer is too low. On the whole my experience with buying from banks was a whole lot more pleasurable and profitable in the long run.
Well, unless the bank is selling through an obnoxious agent that is - s/he can be “insulted” by her commission being less than she’d hoped, or in finding someone else to blame while knowing deep in her heart that she can’t sell at the bank’s wishing price.
It’s funny though, when you go back and read your own posts you realize that you shouldn’t be writing on the web when you’re up in the middle of the night with insomnia…
I agree. When you are up in the middle of the night with insomnia you should be watching old Twilight Zone episodes on SciFi and eating a whole box of orange creamsicles.
There’s plenty of time during daylight hours to pore obsessively over this blog.
RE: Right now, I see the banks being as greedy as the FBs in pricing these places.
I don’t know if it’s greed or fear.
When I used to do REO appraisal’s I’d get the occasional call from a bank work-out rep who was just about to go into cardiac arrest, once they got the report and did a reconciliation of current value against what was lent.
I figure the work-out department’s are just biding time and coverin’ for awhile longer, since no one wants to be the ultimate bearer of valuation reality to the invory tower inhabitants of upper management.
It’s the proverbial Emperor has no clothes scenario.
OFF WITH THEIR HEADS!
FIRREA lives.
By the time it’s foreclosed and priced 50% off it’ll be a mold infested POS and be worth another 50% off that.
That’s right. You won’t be able to get stuff for -50% until they have been foreclosed on, the bank owns them, and the bank is under pressure to liquidate.
You are absolutely correct. During the S&L crisis in the late 80’s, most of the forclosed properties did not show up on the market until about 2-3 years later.
Agreed. “Predatory buyer” is a stupid term. We are becoming a society that equates market-motivated behavior with being predatory. One wonders whether Fridovich, the Lakeland broker, would willingly pay $30K more for a house than he would otherwise have to.
Funny, I never heard the term “predatory seller” used when having to feed the squirels in order to buy a POS.
Let ‘em rot.
Predatory sellers are known as “responsible upstanding citizens, be they expanding families in need of a larger home, a second home for Ponzi investment purposes or retirees looking to unload the empty nest so they can move to a retirement oasis.” There are no bad apples among predatory sellers, there are only bad applles among predatory buyers looking to buy something at actual value level.
How about a Lemon Law for houses, but have it be just based on price. If it’s overpriced, it’s a lemon. Apparently there are only predatory sellers when it comes to cars.
It’s the predatory sellers living in Lala land that ask 200 cents on the dollar. Buyers are just offering fair market price.
They are giving extreme low-ball offers. But all of them have been rejected.’”
No problem. The buyers can wait. Can the sellers?
How come you’re allowed to be entrepreneurial on the front end but not on the back?
If your name was Trump they’d be saying how astute and wise you were. Bottom line is that way too many RE types have too much skin yet in the game. When they’ve all been flushed from the market the verbage will change.
Predatory Buyers
But of course predatory sellers are ok (ie. specuflippers).
Sounds like fair play to me. No foul. First down again at the 20. Play ball. LOL
We turkey vultures can smell a corpse from miles away. Will wait till the knife catchers and flippers start to stink in the sun a bit.
Mmmm Ahhhhh
Housing Prices: Steepest Drop in 20 Years
Tuesday August 28, 9:43 am ET
By Vinnee Tong, AP Business Writer
S&P Says Housing Prices Fell by Steepest Rate Since Its Index Was Started in 1987
http://biz.yahoo.com/ap/070828/home_price_index.html?.v=7
NAR’s latest market outlook calls for existing home sales to gain momentum by the end of the year, with broader improvement in sales activity in 2008. “Existing-home sales should be relatively stable over the next few months, holding in a modest range, with some pent-up demand growing from buyers who’ve been on the sidelines,” says NAR Senior Economist Lawrence Yun. While noting that sales could be temporarily affected by recent mortgage industry disruptions, Yun added that the “fundamental momentum clearly suggests stabilizing price trends in many local markets.”
Sales of existing condominiums in Florida also decreased last month, with a total of 3,610 condos sold statewide compared to 4,449 in July 2006 for a 19 percent decline, according to FAR. The statewide median sales price for condos last month was $193,900, down 7 percent from July 2006’s condo median price of $209,100. NAR reported the national median existing condo price was $228,900 in June 2007.
Everyone needs to read the full realtor report in the first part of Ben’s article. What a bunch of spin. It made me sick just to read the stuff they’re putting out to the public. Yun out to be hung and the NAR should be brought up on charges of false advertising.
One vibe I’m getting from these people is that the process of trying to sell a home is getting too long, difficult and draining. Even if you think you might have some equity left, it’s easier just to walk. But first, skip a few mortgage payments and put the money in the bank for a rainy day.
That’s why there used to be down payments required. I had a house that took 3 years to sell. I didn’t just walk because even though I lost money on the house I would have lost a whole lot more to leave it to the bank. This whole 0% down piggy back stuff is a crock and the sooner it’s totally gone the better.
Or alternatively, if you can find a desperate seller who will go for a 1998 price now, then maybe we should take it while we can get it…
I wouldn’t even mind paying a 1998 price with a 2% per year appreciaton. That would be closer than 200% appreciation in 2 years.
“Market Forces Continue To Bleed Value From Homes”
It wasn’t long ago that “Market Forces” were pumping up “Value” in “Homes.” Homes got blown into balloons with too much “value.”
Jas
“‘If they don’t reduce by 10 percent, they along with everybody else are still going to be on the market in six months and probably in two years,’ he said.”
- I like South Carolina, but I think the TV Flipper programs have caused a real disconnect from the real market. That first 10% cut is simply a first ’slap of reality.’
Next thay can start to get real with there emotions and work there way to a cut of 30% or so.
SC is similar to FL in that the wages don’t match the prices, taxes are getting out of control and Myrtle Beach is a big specuvestor location. Normalcy is slowly coming back. And a 10% cut is a small start.
Same thing in Oregon. Yeah, I know, it’s different here. I have a new mantra: “Sell now or be under water forever!”
Funny to hear comments on SC. When I was back there talking to some of the locals on housing and law enforcement isssues they told me that they are known as the ‘Half-Back’ state. Not knowing what that mean, I inquired as to it’s meaning. The reply: most northerners move to FL and when they can’t afford it they move half-back.
And its only a matter of time before Sc and NC see all the same problems as NY and SoFL
I know someone in the Greensboro, NC area. House has been on the market for a couple on months and nothing has happened. Told him to not be shy about discounting, that he wants his house to be the cheapest one on the street, not the most expensive (thare are about 4 others for sale on his street). I also warned him that if he doesn’r sell soon (he’s moving away) that he will get stuck with it for a year and end up selling at a bigger discount than if he just fire saled now.
But of course, like other sellers, he doesn’t want to sell it for “less than its worth”.
Saw property ladder last night. In the end the flipper worked 12 weeks and basically only broke even. Hope flippers were watching that. Plus the kid was 25, had bad credit and Mommy and Daddy had to loan him the money to fix the house.
Sounds like the guy behind me. Trying to sell the house after living in it for just a year. For almost $30k more than the purchase price.
Surprise: After almost 5 months, it’s still for sale. Got a good crop of weeds growing in the front yard…
when were these shows taped - what amazes me is that none of them show significant losses.
Its like those commercials where they show people picking instant coffee over fresh brew. They just show the few who actually prefer Folgers.
“Typically, a speculator paid to have a three-two with a two-car garage built in North Port for a little more than $200,000, Richmond said. ‘They can now sell it for $180,000,’ he said.”
BWAHAHA $180,000 is sooooo 3 months ago!!!
Try $150,000, loser. And only if you pay closing costs for buyer, home warranty and 2 point on the mortgage.
Ahhhh, I love the smell of desperate flippers in the morning!
smells like…
…victory.
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
I’m getting so tired of reading quotes like this. Are we becoming a victim nation? What happened to being accountable for your own decisions? I don’t discount the fact that some people were victimized in this whole mess. But the vast majority were victims of their own greed, short sightedness, and stupidity.
Right after 9-11 I remember feeling inspired by all the stories of good, decent hard working people affected by the trajedy that were just trying to make a living and take care of their families.
Unfortunatly this housing bubble crisis is showing the other side of the coin, and frankly I’m embarrased.
Well by my calculations, if prices doubled and tripled in the last few years then 50% cut is about right. That’s not lowball, that’s market buddy.
When you buy on sale at wally world, you’re an astute buyer. When you buy a house on sale, you’re a predator. Oh, that’s right, when you buy a house on sale all the strap hangers don’t get as a big a slice of greedy pie. (realtwhores, taxman, etc)
I guess then there must have been “predatory sellers” when they sold for profits during the runup.
Worst than embarassing–it’s revolting. We all remember the recent past with such sickening seller tactics as demanding “love letters” from buyers, intimidating buyers into waiving inspection clauses, rejecting offers with any contingency clauses, etc. As The Worm Turns–see the new season this Fall!
As far as realtors, like stock brokers, they “earn on the churn” i.e. it doesn’t matter to them so much if prices go up or down as long as they’re *moving*. No sales=no commisions.
Like it’s been said on this blog numerous times: it’s not a “buyers’ market” unless they’re buying–which they’re not!
The realtors who’ve drunk their own koolaid and own multiple wanna-be flips are the ones sweating bullets right now. I think that in most markets, the realtors who are making a living these days are the ones who wisely diversified their business by getting into property management/rentals.
sickening seller tactics as demanding “love letters” from buyers, intimidating buyers into …
———–
I remember an incident back in 2004 when a buyer-couple had their little girl write a desperate ‘Why I love this house’ letter to the sellers to grant them the right to buy. I thought there was also a report of a seller requiring any potential buyer to agree to feed stray animals (squirrels?) wandering around in the backyard.
Ahhhh.. those good old days when sellers ruled!
I think every buyer should demand a seller letter about why they need to sell. Could be entertaining.
Watched this show the other night with this couple buying. It was taped Aug 2007. They wanted this house in the mountains. He would pay more than she would, so they ended up going with his number. Agent told them they’d get an offer accepted sooner without home inspection contingency. Made me sick. You should never even buy a new house without home inspection. It’s amazing what they turn up. Plus in the end they were getting a 5 year interest only loan, and thought it was a real deal.
I continue to hear the dreaded, “I’ll just rent it out until the market comes back if I can’t get my price.” In what universe does it make sense to spend $50,000 a year to collect $24,000 in rent while waiting for the turn-around? My nephew just closed on a home in New Orleans against my advice because he’s “tired of throwing money away on rent”. It’s only costing an extra $700 a month to join the ranks of homeowners not counting the expense of repairing his own appliances, AC, roof and cutting his own grass. The level of denial is still very high outside of this blog.
So apparently your nephew decided instead of throwing money away on rent, it is so much better to throw it away on interest that he can throw away twice as much! The poor fool. There are times to buy and times to rent. We know what times these have been.
By the way, is his house above or below sea level? (Yikes)
It’s only costing an extra $700 a month to join the ranks of homeowners not counting the expense of repairing his own appliances, AC, roof and cutting his own grass.
Hmmmm….$700.(+) x 12 months =$8400.00
A person could sure enjoy a nice month in Europe and accumulate some life time memories for that amount.
You should see the miami condo situation. Nothing to do in midtown (a former crack town) and yet 7K additional units in 2008.
What happens to ghost towns filled with condo towers?
I was in Miami a few weeks ago for a weekend vacation, it is truly breathtaking to see the downtown section and the condo boom there. It’s almost surreal; everywhere you look there are highrise cranes and massive shells of buildings. For anyone who has not seen it; it’s almost worth taking a vacation in Miami just to see it firsthand. It’s out of this world, the only thing that I can compare it to is perhaps back in the roaring 20’s when all the skyscrapers started to go up in the major cities.
It’s a sight to behold, that’s for sure!
Take a photo and post it here, Mr. Exciting Statements.
Homestead is another ghost town, thousands of Mcmansions all empty except a few. These huge communities were built in an area with no jobs or things to do once the sun goes down.
A former crack town? I am not so sure about “former”, just drive the side streets
Credit-card defaults rising in the U.S.
U.S. consumers are defaulting on credit-card payments at a significantly higher rate than last year
http://www.marketwatch.com/news/story/credit-card-defaults-rising-us/story.aspx?guid=%7BC4FE2D82%2D06FD%2D400A%2DA524%2D4D2A76FE3ECB%7D
But, but, but subprime is CONTAINED!!!!!!!!!!!!!!
Suzanne researched it! Lereah promised me! Kudlow said so!
Man, it sure feels like Christmas in August… for savers like me, that is. And yet, the train wreck is just starting. Just imagine the headlines a year from now!!
Wake me up in 2009 when the flippers and floppers are ALL toast, the realtwhores are publicly reviled for the scum they are, and the Bush cabal is hiding deep in Paraguay.
When I sold spring 06, several friends questioned my thinking. I told them it was the top and only going down afterwards. I feel bad for those who thought they could continue flipping. We haven’t seen anything yet. 2008 is going to be murder, and none of us will be happy, even the savers. I think there’s going to lots of pain. Say a prayer.
Builders are starting to look at lowering prices versus the incentive packages,’ said Tom Maeser, president of the Fortune Academy of Real Estate.”
Actually in Ohio if the incentive is not a part of the house construction or the landscaping the incentive is a little bit this side of illegal. You cannot give a car and add it into the price of the house. Everyone could be in trouble, builder, mortgage broker, appraiser and agents.
Garage ornamentation?
And don’t get me started on the term “predatory buyers”. In our trade system, you make an offer for something you want, and the other person has the right to say yes or no. “Predatory buyers” makes it sound like you’re holding a gun to somebody’s head. “You’re going to take 35% on the dollar and like it, scumbag!”
What about predatory sellers who are still trying to get top dollar for their homes at the expense of buyers?
Off topic, but the Bits ‘n’ Buckets is getting large and it got me thinking. Credit card defaults are obviously on the rise and while they may have recourse you can’t squeeze blood from a turnip. They may be good shorting opportunities.
So what are the symbols for the various cc companies? There’s quite a few investors on the site - how do you look up symbols for the companies you invest in. What are some good sites to do this?
If you don’t know how to look up stock symbols and company information you probably shouldn’t be engaging in shorting stocks. Perhaps Txchick can suggest a fund that will do it for you.
Thanks for your insightful response. I’m asking for good financial sites where I can look up specific groupings of corporations all at once. I know there’s pay sites out there, but are there and free ones with a good search engine? I don’t want to just look up one company at a time and be restricted to the major corps that I know about. I’m wanting something that’ll give me the whole industry so I can compare and contrast.
“SKF” is an ETF that goes short on financials. Look it up and then see what their portfolio is and that will give you the names of the banks that they are shorting.
The only good one I could think of is Capital One - COF. There aren’t many public banks that specialize in CC - MBNA would have been a good one before being bought by Bank of America. The only other one that specializes in CC is American Express - AXP, but the nature of their cards is such that they probably won’t see big defaults like COF will. I’m short COF, though I timed it really poorly at 62 a couple of weeks ago. I’m a “long short” though, and will hold for as long as it takes for the playout generally - e.g. I’m still short homebuilders and Countrywide - I think there’s more and deeper pain to come.
‘Buyers are scraping the bottom of the market and coming back to the best price in whatever category’ in which they are looking, Antonich said.”
Why those predatory bottom-scraping buyers. How could they?
Ye predatory bottomfisherman cometh…
Beware of the grim reaper of real estate this Halloween.
Everything’s contained…
http://biz.yahoo.com/ap/070828/home_price_index.html?.v=3
When you buy at 50% off, all the strap hangers don’t get as big a piece of greedy pie. (realtwhores, taxman, etc)
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
ALL of them have been rejected?? Dream on, idiot!
I called a realtwhore in Encino, CA, yesterday and made one of those “predatory” offers the shill is whinning about… guess what? They didn’t take the 50% off I offered (all cash), but countered with 35% off instead!
You should’ve heard the excitement in the realtwhore’s voice! She hasn’t sold a thing since June. And this particular house has been on the market for 137 days…
I told her I would “think about it… besides there are three other houses nearby that I’m looking at. I’m waiting to hear if they’ll take my offer”.
The poor thing was speechless… and then said “I’ll talk to my clients and get back to you.”
BWAHAHAHAH
I got a feeling my “outrageous” and “predatory” offer is looking better and better with each passing day.
“Fenn recently tried posting huge signs in the yard and on the garage door. One read: ‘Reduced $1,000 a week until sold.’
Try knocking off $10,000/wk until sold, Fenn. What a moron.
Let ‘em rot.
Easy. After we get through this recession the American populace will clamor for a return to economic fundamentals, you know, actually making stuff. When that happens we’ll have to re-industrialize the country, which will mean importing millions of Chinese and Mexican laborers. Gotta house em somewhere and downtown Miami works fine. Meanwhile, the credit gravy trains for Americans will resume and we can get back to watching our plasma TVs in exurban McMansions.
If that isn’t the most idiotic marketing strategy I’ve ever heard! It might work on the way up, Cletus, not on the way down.
“Honey! We gotta buy this one quick or it’ll be thousands cheaper later.” Huuwhhaaaahh??
Here’s YOUR sign . . . .
Oh, we have a Craigslister in Bend, Oregon, who is “too busy with projects, so just take these lots off our hands for less than we have into them.” Price will go UP 1000 a week until sold. Sure it will. These stuck flippers are also trying to sell a house - buy it now before it’s listed “and out of our hands.” Did they mean foreclosed?
Link, please??
Isn’t this pretty idiotic, anyway? Give buyers an incentive to wait you out?
. With Realtors closing at the rate of 87 homes per week, that is an inventory of about 21 months. In Sarasota’s condominium market, it is worse. There were 4,808 units. Realtors are closing on about 40 per week, leaving a two-year supply.”
The next big question is WHO are the friggin dolts buying these falling knives? Are these folks a bunch of cave-dwellers that have no access to news? The loan officer should be issuing a drool bag and a guardian to any idiot buyer that shows up to a closing these days!
my wife and i are gonna sell our condo and rent. not so much as a panic but the clock is ticking and we will need more space if we have a child.
when i tell co-workers my plan to rent i get absolutely scorned. like i am some low life or soemthing. i find it very peculiar.
Try telling your co-workers you don’t want kids
Then you’ll see some real scorn!
I’m starting to get images of crabs in a bucket! Bwaaahhaahaa!!
I told my wife that 10 years ago. Scorn x eleventybillion.
im not sure my wife wants them though.
i just want one…and maybe get it a friend later
: )
I know - I wasn’t aware of the bias against renters until I became one again. Just this past weekend two close friends were urging me to take advantage of this buyer’s market.
(I think they believe prices will go back up. Whether that is the case or not…what’s it to them, anyway?)
Maybe they are ashamed to have a renter as a friend, and need to get me back to homeowner status ASAP.
Misery loves company.
I think there’s some truth to that.
One of my friends says that’s exactly what it is. He cites renters, marriage, and kids as his examples.
He says:
Ever notice when you’re in the receiving line at a wedding and the couple says, “So, when are YOU two gonna get married.” Then once you’re married, your friends with kids are always, “So, when are you gonna add some new family members.”
So true.
The reason you are scorned by co-workers is that if you are right about the housing market, not only are they wrong, but they are financially ruined.
snake: the new theory is that social mood determines the economy, not the other way around, Elliot Wave theory if I understand it, is fundamentally about mood. Blogs like this one, influence mood by supporting and re-enforcing the outlook that the housing market has peaked and is going down. Bloggers here write that their wives/husbands, family, neighbours and co-workers are bullish on housing “buy now”. Without this blog, we would be isolated and silenced. Moreover, this blog serves to convince and recruit people to our outlook. Result will be a sea change like war but faster!
“my wife and i are gonna sell our condo and rent. not so much as a panic but the clock is ticking and we will need more space if we have a child.”
Babies and toddlers don’t need a sfh or even a condo to be happy. You’re not going to let them play outside alone anyway and it frees up your time to play with them, since you’re not busy maintaining your property. Plus all the money you save can defray the cost of some nice gymboree classes, quality childcare, or even enable one of you to stay home for a couple of years.
Also, God forbid you have a child with a learning or other disability, you might find yourself looking at schools with a very different perspective. Our old district (where we owned) would not have really met our needs as it turns out. You really won’t know what you want/need for your children until you have them.
Houses are normally better than money in the bank, and inflation is still running around 3-4% per year. You can’t blame people for trying to get rid of their depreciating dollars.
My credit union was just taken over by the feds (Norlarco in Colorado)what’s better a house or money in a bank that makes flaky loans to other people to buy houses? This party isn’t over yet, and all the smug “money in the bank” folks could be singing the blues yet as well. If there is anything democracy is good at it’s spreading pain. If we were still a republic I’d be more confident in the future, but our Pres and CONgress seem to be following the siren song of democracy. The printing presses are most likely going to be busy soon. It’s just a matter of who gets the hot cash first.
What are you, friggin crazy? The housing market has been hyper-inflated for the past several years by easy credit so NO, having money in the bank is in fact better than owning an asset that is losing 5-15% per year. Especially since that price inflation was boosted by a credit bubble that is now imploding. Holy smokes man, do some research! You don’t have to have your cash in a bank account. Put it into USD treasuries or foreign ETF funds. Do ANYTHING other than ride this housing bust down with leverage! Are you a troll or are you seriously thinking that housing is going to be getting “the hot cash first”?
Yeah, Cash is KING baby.
Let the trolls rot.
It didn’t dawn on my until auguer called him out as a troll.
Call me a troll, whatever you want, it’s just make believe. I’m just pissed that the govt is doing it’s best to ruin the value of my savings regardless of where I stash them (check out the tax laws on gold for instance). I think you guys way underestimate the power of the crowd. All I’m saying is that this game hasn’t played out yet and that democracy can really suck (ask the Germans how their 1930’s worked out).
Cash is king? Try leaving the country with it.
Can you take your house with you? At least you can smuggle rolls of $100 bills or gold coins with you as you leave. All you have to do is drive into Tijuana, no one will check you as you leave. Just get a safe deposit box on TJ and you are set!
Try doing that with a depreciating Larimer county house.
“The next big question is WHO are the friggin dolts buying these falling knives? ”
Exactly. I’m VERY skeptical of the sales numbers put out by NAR and the local “ASSociations”. I just find it difficult to believe that sales have held at 2006 levels.
looking at Melissa Data numbers by Miami zip codes - the sales in the most fashionable areas (33156 - Pinecrest, 33146 - CGables) are holding on 2006 levels. Probably, in Q3 the credit crunch is going to affect them as well.
In other codes, the sales are 25-35% down. Hopefully, the prices will hopefully start sliding down - so far it’s not the case.
Sadly, some friends of mine are among those dolts. Generally financially responsible folks who rented all the way through the boom — and are supposed to close on a 3/2 condo in Chicago at the end of the month.
I tried to talk them out of it to no avail. (It’s hard to do without sounding A.) like a know-it-all, or B.) like a former owner with a case of sour grapes.)
I’ve kind of been hoping their mortgage would fall through, but I’m almost certain they are approved for a prime mortgage.
bailout debated:
WASHINGTON, Aug. 24 — Faced with a possible tidal wave of home foreclosures beginning this fall, Democrats and Republicans are battling over a philosophical question with huge practical implications: should the government ride to the rescue?
http://tinyurl.com/2ypqwo
Help stop bailouts.
http://www.petitiononline.com/bailout/
I posted this earlier, but it still hasn’t shown.
“The median price of an existing single-family home sold in July in Palm Beach County declined 5 percent…”
What my question is…the question of the century…how is the median still propped in the $370K range? I don’t believe the NAR any more. I know that the $350K buyer is still buying a $350K home discussion and I used to buy into it…but…homes in my neighborhood…huge homes 4BR/2.5BA/2CG for $299K.
Median is propped up by the high end home sales. If few houses sell, one with a big price tag can raise the median price (while the AVG price is going in the toilet) Watch and you will see they quote median or avg depending on which one is going up.
“…(while the AVG price is going in the toilet)…”
Still…if half are selling for more and half are selling for less…I just know that I work in a business that sees these transactions. I would say the vast majority of homes being purchased right now are in the $225K to $300K range. Very rarely will I talk to someone purchasing above that.
1,2,3,4,5 - Median is 3. Average is 3.
1,2,3,4,50 - Median is still 3 while the average is 12.
3,4,5 - Median is 4 and average is 4. Low prices dropped out.
A shift to higher end houses has been supporting the median as subprime loans faltered before the Alt-A products. If high end house are priced at the down payment plus 417K, many prices will be crushed.
What they really need is a dollar volume of houses sold. I’m sure the dollar volume has totally cratered.
The business talking heads are finding it hard to spin a great market going into the future .
The heads never seem to admit that the RE market went way ahead of true value . If I remember correctly ,a appraisal is suppose to determine market value today and not include any future possible value .This is where the appraisers failed in doing a accurate appraisal by excepting speculator and unqualified buyer demand betting on future increases during the boom .
The overall increases in bubble areas were so off the charts that it’s hard to believe that the REIC could of justified 20% to 50% increases in one year .Loaning on increases like this was just plain incompetent,especially if you consider the no down /no skin in the game aspect to the lending .
The Wall Street boys who were marketing these BS loan packages failed to check their front line provider of loans for quality ,but they should of know that the lending was absurd and the appreciation rates were off the charts . IMHO ,there is a lot of liability here with the RE industry as a whole . A bail-out is a attempt to cover up the extent of the crimes committed and they are not really looking out for Joe six-pack or they would of never allowed a borrower to set themselves up for a 13% rate on a inflated house .
If the market predictors just looked at the ratios of home ownership alone ,they would of know that to much over-building was taking place and demand was not coming from end-user buyers .In fact they knew that speculators were making up a big market share . The fact that this over-heated market was not questioned in 2004 at least is odd .
“‘And we’re still not showing it. I just have to hope in a month or so that when the snowbirds arrive, we’ll get a bite,’ said McDaniels.”
Um, would be the same snowbirds that the Floridans were blaming for high property taxes, that now have to pay way more taxes than Floridans due to the discriminatory SOH tax rules? Those snowbirds aren’t coming back, Susie.
Your high property taxes were due to high-spending governments that YOU elected, not the snowbirds. You made your bed, now you have to sleep in it. The dodo bird is extinct. And flightless, too.
Big gov’t Northeasterners moved to FL, elected big gov’t politicians who raised taxes on NON voters and recent arrivals. All of whom are now fleeing the state.
It always amazes me how people leave one place, go to another for a better quality of life and then vote the same way they did before and ruin the new place by making it exactly like the place they left.
NoVA is exactly like MD, SoNH looks like Taxa2sh!ts, FL is a southern suburb of NY/NJ, etc
Excellent point not often discussed here Jay. We have exactly the same situation in New England states. NYC, coastal CT, Boston and Philly clowns swarming on traditional rural areas and changing the local, economic and political landscape to something God-awful grotesque.
florida was a big retirement mecca. old people don’t care about schools. couples with kids moved in for cheaper housing and they care about schools and so they raised to taxes to pay for them
That’s way too soon for the snowbirds to show up anyway.
“Honey, I know Connecticut is beautiful this time of year — past the summer heat, before the winter chill — but how ’bout this year we go down early to Florida this year and catch the end of hurricane season?”
I left Florida already and the snowbirds left after Hurricane Wilma in 05. As usual it takes Florida about 4-5 years to wake up..so sometime next year you will see an article titled, “Where are all the snowbirds?”
Went to states where housing prices, taxes and insurance are more reasonable.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20070828/UPDATE/708280408
With Detroit of all places leading the cities for now in the downward march, with an 11% year over year decline, how can the bubble markets NOT take major haircuts??
Detroit had the highest numbers of foreclosures by zipcode too, but this isn’t surprising. It is just a continuation of 40 years of exodus that started in the 1960s. Many places in Detroit you couldn’t sell a house 20 years ago. Why would it be better now?
Tucson’s REIC is really bummed out:
http://www.azstarnet.com/sn/biz-topheadlines/198433
And even more unhappiness from Tucson:
http://regulus2.azstarnet.com/comments/index.php?id=198453
Wow….the sharks are feeding on each other.
Was listening to NPR report this morning. To paraphrase: The hedge funds sophisticated models for buying MBS missed a crucial factor. Many borrowers don’t like paying for an asset that is losing value so they walk away making FICO scores a cruel joke.
Good thing that hedge fund people are pretty smart. They aren’t going to fall for that joke again. This means the dream of homeownership without paying any $$ is gone forever. That’s good.
speaking of snowbirds . .
I love the menality of “them” & “they” -ism. For example:
” I wish THEY would stop moving here, it’s getting too crowded”.
” Look at all of THEM in the traffic, Golldarn the beach route is too crowded”!
People always exclude themselves from the picture when making irate comments, as if somehow time / progress should now stop when THEY THEMSELVES buy or move somewhere.
Been hearing the kvetching about new arrivals forever but somehow it’s always AFTER the commentors are settled.
hilarious, actually.
The final nails in the sub-prime coffin. Many lenders now require brokers to submit IRS Form 4506 with borrowers applications. It seems IRS Form 4056 is the form requested by the IRS before they will release tax records of a potential borrower to a lender. According to companies and banks, “Form 4506 helps to prevent fraud.” Which has been running rampant for several years. Actually, “rampant” is putting it politely.
What this means is, we are without a doubt in a new era of lending where property is concerned. Gone are the 100% ltv’s (loan to value). 80% will probably become the norm because lenders are going to be so badly burned by the sub-prime fallout, they want a cushion of 20% down so anyone walking away doesn’t stick them with the full amount.
Just how bad is this going to get? Very, very, very bad. Here’s a possible look at the future property landscape: No more sub-primes which means a very large number of would be buyers (consumers) have joined the 2000 to 2005 property boom and bust history books. A LOT of unemployment as realtors (oh, dear how sad) and brokers (oh, dear how sad) join the ranks of the long term unemployed. Wanna buy a gently used BMW because there will soon be a lot on the market. A MASSIVE pull back in spending as consumers try and work off debts or just stay above water. A million + foreclosures. A MASSIVE inventory of unsold homes. Condo’s will be a horror story as they usually are in a boom and bust. Many, many builders and those associated with real estate construction are declared bankrupt. You can probably throw in a few hedge funds going belly up. Could be even the Financial Gangsters of Wall Street will not be able to bail them out. HOWEVER, don’t take that for granted. The crooks of Wall Street and their pals at the SEC will fix the books as best they can.
Options? Not many despite the likes of “Sniffer” Krudlow and the other shills on the CNBC Comedy Business Show touting the word “recovery”. Lower interest rates? Maybe but it will make a very small dent in a massive problem. Print more money? The world is already knee deep in US confetti dollars and the US needs billions of dollars every day from foreign investors. Under Bush the US dollar and US credibility is in the toilet. The US dollar is NOT a safe currency anymore and there are several currencies out there which are much safer. Better hope the Chinese resist cashing in the US gambling notes they hold.
Summary: Buckle up and hang on for the next 5 years or so. It’s going to be a bumpy ride.
Excellent critique…….. Thank you.
“Many lenders now require brokers to submit IRS Form 4506 with borrowers applications. It seems IRS Form 4056 is the form requested by the IRS before they will release tax records of a potential borrower to a lender.”
With this in place, the serial refi suckers are kaput.
Let ‘em rot.
it might take 15 years, but 100% LTV will be back. people are stupid and after the easy money is made they take on too much risk in search of reward. of course they forget about the risk part. kids will grow up with no memory of the past and all the youngins think they know everything and all the older people are stupid because they don’t want to take on too much risk
I agree with you. It’ll be back. The good thing is, they drink their own Kool-Aid, so it’s self-correcting. Sorta.
Mike: Insider knowledge, literate ( no spelling mistakes, no grammar mistakes), demonstrates mastery of language and expression, knowledge of global economy.
Buckle up and hang on for the next 5 years or so. It’s going to be a bumpy ride.
IRS automated the 4506 request process to be very fast versus taking a week + in Oct 2007.
Funny this coincides with the sub prime blowup.
IRS automated the 4506 request process to be very fast versus taking a week + in Oct 2006.
Funny this coincides with the sub prime blowup.
Don’t you feel bad for the Corp fat cat’s, many of them are down to owning 3 houses instead of 4 or 5???
Another disgraced Economist:
Sarasota Herald last may
MAY 18
Economist offers dose
of assurance on homes
Hank Fishkind, Florida’s premier economist, believes that the downturn in the residential real estate market is over.
That does not mean that Southwest Floridians will see much improvement in the months ahead. But barring a sharp increase in oil prices or some other earth-shattering event, market conditions are not likely to deteriorate.
For the several hundred members of Southwest Florida’s real estate industry who packed Lakewood Ranch Country Club’s grand dining room Thursday night, Fishkind’s comments came as a welcome relief after two tough years
what’s his email-he needs a link to this blog
hankf@fishkind.com
Enjoy
Shiller’s interview with MarketWatch:
http://tinyurl.com/26q8em
Hank Fishkind, Florida’s premier economist,
FISHkind?????????? Premier economist?
Man, these clowns just don’t know when to stop.
BWAHAHAHAHAHAHAHAHAHAHAHAHAHA
ALERT… More foreclosures coming soon to Orlando, Atlannta, etc…
SAN FRANCISCO (MarketWatch) — EarthLink Inc. (ELNK) on Tuesday outlined a corporate restructuring plan, including the elimination of about 900 jobs. The Atlanta-based Internet services provider said it plans to close its offices in Orlando, Fla.; Knoxville, Tenn.; Harrisburg, Pa.; and San Francisco, and “substantially reduce” its presence in the Pasadena, Calif., and Atlanta.
“Builders are starting to look at lowering prices versus the incentive packages,’ said Tom Maeser, president of the Fortune Academy of Real Estate.”
That would completely destroy the median prices. Throw in the credit crunch and run for the hills.
“Jim Mander still is trying to find a buyer for the four-bedroom Davie house he listed more than a year ago. The property with a pool is set on an acre lot and has been renovated extensively. He originally was asking $789,000, but he’s down to $749,000 and getting frustrated.”
“‘I’ve got a feeling it’s not the house, it’s not the location,’ said Mander. ‘It’s just the market. My timing was wrong.’”
IT’S THE PRICE, STUPID!
“Fenn still likes Southwest Florida. He just wishes he did not own so much of it”
ROTFL
“Fenn still likes Southwest Florida. He just wishes he did not own so much of it: ‘I think I got greedy and I think the greed came back to haunt me.’”
My hats actually off to this guy–this is the first FB I’ve seen admit publicly that it was greed that drove him to speculate!
What happens to neighborhoods that are mainly empty condos and unfinished condos?
They become unofficial homeless shelters.
They get bulldozed?
“Predatory Buyer” - I’m going crazy - I can’t shake the “Jaws” music/image.
Have been watching the St Augistine market for the last 18 months through a realitor provided MLS emailed to me. Have recently noticed prominently displayed $5K- $10K reductions that represents 2-3% drops. Can anyone from the area tell me what is going on? The $200 sf prices for 1500 - 2000 sf block homes in marginal areas seems a tad high in good times much less in todays market. Could it be that St Aug is actuallky different? Had planned to retire and move but will continue working and saving until the market stabalizes - have to since my home in Virginia Beach is moving into negative teritory quickly. Thanks
St. Augistine area has mass amounts of specuvestors homesites. Prices are 30% - 50% too high.
Have been watching the St Augistine market for the last 18 months through a realitor provided MLS emailed to me. Have recently noticed prominently displayed $5K- $10K reductions that represents 2-3% drops. Can anyone from the area tell me what is going on? The $200 sf prices for 1500 - 2000 sf block homes in marginal areas seems a tad high in good times much less in todays market. Could it be that St Aug is actually different? Had planned to retire and move but will continue working and saving until the market stabalizes - have to since my home in Virginia Beach is moving into negative teritory quickly. Thanks
“‘Homes that sold in the $600,000s to $700,000s market are probably high $400,000s to low $500,000s now,’ said Richmond, citing the Old Grassy Point canal system in Port Charlotte as one neighborhood for such pricing.”
Or more precisely BELOW $417,000.
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
Like the heaviest girl on the cheerleading squad being asked out for the prom. She thinks she’s all that, but she’s not. At the last minute she still have to go with some total loser. Classic.
“In a market that has turned favorable to buyers, Fridovich has noticed a new type of home investor - predatory buyers. ‘They are making offers of 50 percent on the dollar,’ he said. ‘They are giving extreme low-ball offers. But all of them have been rejected.’”
Funny how I never saw an article with the words “predatory sellers” when houses doubled in price in a few years. And BTW - these 50% offers may look good in 1-2 years…
Breakfast TV in the UK this morning interviewed a property speculator who owns 700 properties, which he rents out.
The speculator said that he closed on the purchase of another five properties on the way to the TV station !
Around the corner from where I live is a 35 year old property magnate who owns 100 properties, which he also rents out !
He also owns an employment agency, which supplies labour to care homes and the British National Health Service (NHS).
He also has an Aston Martin sports car parked in his garage.
Does anybody on this blog see a future for these two budding property magnates ?
Best Wishes,
UKBottomFisher, Cambridgeshire, England.
starring in their own Britcom?
“With positive economic conditions such as low mortgage interest rates and job growth continuing in Florida, statewide sales of existing single-family homes totaled 11,674 in July and were closer to activity in July 2001 and 2002 – before the housing boom years – than the July 2006 figures, when 15,378 homes sold for a 24 percent decrease in the year-to-year comparison, according to the Florida Association of Realtors.”
Did I miss something, or was this statement contradictory - “Things are going great, so prices are back to where they were years ago.”
What?
Sounds like a used car salesman - “Prices are so low we are practically giving them away.”
Guess what, you may be giving them away soon!
Hank Fishkind, Florida’s premier economist, believes that the downturn in the residential real estate market is over.
His source of the data he used to make this determination came from Peter Cottontale. Both of them went hopping down the RE bunny trail!
Statsman
Glad to see someone else recognized the ultimate contradictory spin by the FAR. Damn, these folks are getting good! Black is white, up is down, you say yes, I say no…I am the Walrus, ku-ku-a-choo!
They’re not getting good at anything except double-speak.