The Great Housing Hangover Throbs On In Florida
The News Press reports from Florida. “Last year, Jonathan Kline decided to take a risk and build two houses in Lehigh Acres. Kline, a Maryland resident and financial consultant, discovered Southwest Florida’s sliding housing market after they were completed in April. Like thousands of other houses across the county, Kline’s homes sit vacant while he tries to sell them.”
“‘I bought these houses, but I sure as heck didn’t do my homework,’ Kline said. ‘They never told me how bad it could get.’”
“Since 2000, the county has added 95,000 housing units. The number of vacant houses for sale has more than doubled to 9,723.”
“Kline’s houses have been vacant for five months. Although one should be sold soon, he said he’s still going to lose almost $250,000. ‘That’s a pretty crushing blow. It’s a heck of a lesson,’ he said. ‘I shouldn’t have been speculating in an arena I had no knowledge of.’”
“About 35 percent of the houses on the market were built in 2005 or more recently, said Michael Polly, VP of a Fort Myers real estate brokerage. ‘They’re new homes that people bought two or three of that they’re trying to flip,’ he said. ‘Most of them have not been occupied.’”
“Residences being completed now were issued permits 18 to 24 months ago, he said. That means the recent slowdown in permits will not be seen until almost two years from now, he said.”
“The number of houses adds up to about 27 months of inventory; normal inventory is between 5-10 months. ‘If nothing else came in the market, it would take 27 months to sell,’ Polly said. ‘It’s the most I’ve ever seen.’”
The Washington Post. “The Sun Belt city of Fort Myers, Florida, saw real estate and construction grow to dominate its economy, accounting in recent years for nearly one out of every four jobs.”
“‘We are in a real estate recession,’ said Laurance Baer, manager of the Fort Myers-based Baer’s Furniture chain, where sales are plummeting. ‘And we have an economy that’s much more tied to real estate than anyone realized.’”
“During the boom year of 2005, the take-home pay of Dawn Shevlin’s family reached $350,000. That year, she and her husband bought two pickup trucks and a boat, and started building a custom home on a handsome beachfront lot.”
“This year, Shevlin, a real estate agent, sold hardly any homes. Her husband’s carpentry business is ‘dead in the water.’ They have been unable to sell a second home they own.”
“Every night, she said, ‘we fight over every dollar.’ With their income below $60,000, they have more bills than they can pay and have ruled out any big purchases. Even dinner at a modest restaurant is too great an extravagance.”
“‘I feel like I should be going to a higher place in my career,’ she said. ‘Instead I’m taking 20 steps back.’”
“‘You could make a lot of mistakes and still make money,’ said said William P. Valenti, a longtime banker. ‘People thought it would always be that way.’”
The St Petersburg Times. “In the wild real estate market of 19 months ago, Elmo Bench’s deal to buy a house in Brooksville made a weird kind of sense. The price, $170,000, was the going rate for a three-bedroom house, which was barely big enough for Bench, his girlfriend and their three children.”
“The monthly mortgage payment, $1,240, seemed high, considering he clears only $1,400 a month. But the lender, the now-defunct Homefield Financial told him he could refinance at a lower rate once he built up equity in the house. And, if he got in a bind, he figured he could always sell it for more than he paid.”
“Now, he wonders what he and Homefield were thinking. ‘I just wish they had never given me that loan,’ said Bench, who has been swept up in the wave of foreclosures sweeping the county, the state and the nation.”
“Through the middle of last week, lenders had filed 1,114 foreclosure cases in Hernando County during 2007 - 174 just in August. That compares to 728 during all of last year and 528 the year before that.”
“Bench owed $167,634 on a house that, according to the Hernando County Property Appraiser’s Office, has a market value of $131,000. At one foreclosure auction last week at the county government center, not a single buyer entered a bid.”
“‘There’s just no equity on these houses,’ said Jack Gavish, a Brooksville Realtor.”
The Miami Herald. “Broward County Property Appraiser Lori Parrish has fielded the question ‘values are dropping this year, so why did my assessment go up?’ from property owners so often that she’s posted an explanation at the top of her homepage.”
“Some South Florida property owners will be paying taxes based on valuations that they could only dream of selling their properties for amid the current housing slump. ‘As of Jan. 1, it’s accurate, but it may not reflect the resale value today,’ says Marcus Saiz de la Mora, the acting Miami-Dade Property Appraiser.”
“Stanley Jacobs, who owns four Miami-Dade rental properties, is fuming after seeing his property assessments climb — in one case by $38,000, or 24 percent — despite the weak housing market. ‘I want answers why if the market is declining I was charged more,’ says Jacobs.”
“‘It’s going to be more pronounced next year,’ as this year’s decline in property values are reflected in 2008 tax calculations, says Robert L. Wolfe, Jr., a media and government relations officer at the Broward Property Appraiser.”
“Robert O’Leary, a Coconut Grove resident who owns four rental properties in Miami-Dade County, says he’s steaming that his assessments have risen sharply despite the housing slump, including one Coconut Grove property that jumped 37 percent in market value to $882,492 from $645,698.”
“‘Everyone who has a brain knows the housing market went bust in 2005,’ says O’Leary, who is appealing the county’s assessments to the VAB.”
The News Journal. “The great housing hangover throbs on. Three years after Hurricane Ivan supercharged an already hot local housing market, the good old days of soaring prices, easy money and fly-by-night flippers are long gone.”
“What’s left is an anemic Escambia-Santa Rosa County housing market, glutted with some 10,000 homes for sale, and beset with a stagnant number of transactions.”
“Add to that painful mix runaway insurance costs, crushing property taxes and a clampdown by banks on sub-prime mortgages and it’s a perfect storm of negatives stonewalling any significant near-term housing recovery.”
“‘Fallout from the end of the housing party is now showing up clearly, and this will inevitably affect consumer spending,’ said Rick Harper, director of an economic think tank based at the University of West Florida. ‘The housing market is not yet in recovery.’”
“‘Locally … home prices have grown much more rapidly than wages,’ said. ‘For most of the two decades prior to 2000, median home prices were about 3.2 times median annual household income. They are now about 4.5 times median household income.’”
The Herald Tribune. “Not long ago, carpenter Kristopher Phillips could not keep up with the orders for moulding in the hundreds of homes being built in North Port.”
“In August, North Port issued permits for 12 new homes — the lowest monthly total in five years. The city issued more than that in a day back in 2005 and 2006, when North Port led the region in new home construction.”
“‘We were doing 15 homes a week,’ said Phillips. ‘Now I get maybe one a month. Maybe.’”
“North Port’s August building permit numbers are down 89 percent compared with the same month a year ago. ‘I believe that that this is the bottom,’ said Ron Hill, president of the Charlotte/Desoto Building Industry Association. ‘If anybody is interested in getting a deal on a new house, there’s no better time than right now.’”
“‘You knew that something was going to give because of the speculators in the market,’ said Tammy Lynch, president of the Home Builders Association of Manatee County.”
“Centex Homes pulled two of the 12 permits issued last month. ‘We’re not even halfway built out,’ said Megan Zoller, sales consultant, of the company’s two neighborhoods going up on Toledo Blade Boulevard. Centex plans 1,257 homes along the roadway that connects North Port to Interstate 75.”
The Palm Beach Post. “Palm Beach County and the Treasure Coast - where boom-time home sales sizzled and prices went through the roof - remain ’stubbornly overvalued’ even though the party’s over.”
“That’s the conclusion of a report by economic research giant Global Insight, which studied second-quarter single-family home prices in 330 metropolitan areas around the country. Home prices in Port St. Lucie, which had a median price of $226,400, were overvalued by 40 percent, according to the study.”
“Despite steady price declines documented by the oversight office, the market was still 28 percent overvalued in the second quarter, the study reports.”
“‘The price that the model is generating, the one that market fundamentals would support, is $216,500,’ said Jennifer Cataldi, senior economist and Global Insight’s manager of real estate service. ‘That’s where the market should be at, based on the fundamentals that we are looking at.’”
“In all, 80 of 330 markets nationwide had price declines while 51 were ‘extremely overvalued,’ the report said. Florida and its coastal areas, plus the corridor from Washington to Boston, accounted for most of the metros with ‘extreme overvaluation.’”
“Global Insight defines extreme overvaluation as a variation of at least 33 percent between what a sale price is and what it should be.”
“Richard Langhorne is trying to make lemonade out of a lemon of a real estate deal. The CB Richard Ellis exec is working to find a buyer willing to pay a steep price for the failed Villa Mare condo conversion in Boca Raton.”
“Villa Mare is the subject of a $50 million foreclosure lawsuit, the largest foreclosure action in Palm Beach County. Villa Mare’s owner recently hired CB to find a buyer and rescue it from this disastrous deal.”
“It seems the property might have greater value as something other than a condo or apartment. (Hotel or condo-hotel, anyone?)”
“It was only in April 2006 that Ocean bank loaned NRW Development LLC $59.6 million to buy the former Oceanview/Lakeview apartments for the Villa Mare project. Plans were to turn the aging apartments into a luxury condo beach club, with individual units costing up to $1.2 million each.”
“But NRW’s plans washed out. Analysts say NRW overpaid for the apartments. And NRW launched Villa Mare just as it was patently clear the market for converting apartments to condos had come and gone. Some $50 million remains unpaid on the loan, prompting Ocean Bank’s June foreclosure lawsuit against NRW and its principals.”
“If Ocean Bank couldn’t see this deal going south, it seems NRW officials could. Two investors say NRW reps were trying to get out of the deal only months after getting into it.”
“If a potential buyer is even thinking of condos, Pickett suggests they think again. ‘Condos are radioactive right now,’ said HABS Capital’s John Pickett. ‘I’d be shocked if they get $50 million in this market.’”
‘During the boom year of 2005, the take-home pay of Dawn Shevlin’s family reached $350,000. That year, she and her husband bought two pickup trucks and a boat, and started building a custom home on a handsome beachfront lot. Every night, she said, ‘we fight over every dollar.’ With their income below $60,000, they have more bills than they can pay and have ruled out any big purchases.’
This is exactly what made the RE bust in Texas as hard as it was. Not that people couldn’t live on $60k, but they leveraged up so much during the boom that they were wiped out.
This quote reminds me so much of the book “The Millionaire Mind” and how sells people tend to appear so wealthy for a short time but are living foolishly because their careers go in cycles. This is one of those harsh cycles where smart sells people would’ve been more conservative during the boom time to put money away for times like these. Unfortunately, the sociologist have shown that the behaviors in the quote above a by far more common.
Oh well, anyone need a slightly used boat or truck???
Last year I had great year, this year has sucked I am making like a 1/4 of what I made the year before.
But I have 100% of last years in earnings in the bank, so I am not that worried. I wonder if Dawn had that 350k in the banks instead of leveraging herself to death if she would be happier?
Of course then should couldn’t go around telling people how she “owns” 2 houses, one on the beach
I guess they did’nt save any of the 350K from last year-thats too bad.
Even that 350k number is foolish. So, they “grossed” $350k. What did they bring home? They must have gotten creamed by taxes. If they put anything away in retirement savings (doubtful) then their take home was probably little over $200k. People fall in love with their gross income number. Net income is the only number that matters and you should stay way below that number with your expenses, if you can.
“Net income is the only number that matters…”
You said it. There’s nothing tax bezerk politicians laugh at more than idiots who think they’re “gross” pay rich.
That is exactly what is wrong with this Americano country. A freaking uneducated peasant-like real estate agent or broker brings in more income than a medical doctor who spends at least 11 years since college or a PhD professional who also spend 11 years in college including post-docs fellowship. Americano ! What a people, what a nation !!!
yes America. and our teachers! those most responsible for our young get pittance pay. i am very sad about our country when i see how much money hedge fund people are making. How much is enough? Apparently more and more to fill the emptiness of ‘community’ is what is necessary. A bottomless pit of materialism.
http://tinyurl.com/346cw5
Here we go with the teachers and other “public” servants. While it surely depends upon where you live, it is my understanding that teachers in the top school districts get paid pretty handsomely, and probably much more, than those in the private sector. And, in addition to pretty good pay, they get all those benefits that no one else gets. A pension? What the hell is a pension? Same goes with all those other “public” servants who bleed the taxpayers dry.
That is the biggest problem people face. My husband and I have been through the ups and downs of having a business..some years good some years bad…but we never ONCE lived for the good years..everytime we have bought a house the response from the mortgage guy was, “but you could afford so much more..” I always said, I want to vacation and I want to eat out whenever I feel like it so no thanks..
“But you could afford to pay me so much more commission,” is what he meant.
I’ve posted this before, but it seems closely tied to what Ben is talking about, so I’ll repeat it. Years ago I worked for a personal injury attorney, who won pretty significant judgments for his clients. He told me that not a single one of his clients would hold on to their money. I was incredulous. Not a single one? He said most would spend it before they’d even received the lump sum. In fact he’d had a client sue him because the client had claimed that he hadn’t done a good job of keeping the money out of his own hands. In other words, people aren’t prepared for a large increase in income.
It’s true, Lionel. Most people who are not used to having large sums of money have no idea what to do with it, other than spend it. Same thing with people who have been living under oppression for a long time. The government changes and all of a sudden they are “free” and they don’t know what to do, so they go nuts. I was talking to a Russian lady a couple of weeks ago who felt Putin was doing a good job in keeping a bit of a heavy hand on his population until they could get used to the idea of a more free market economy. From her experience as a Russian, the people cannot handle too much too fast.
Putin is awesome. What he has done with Russia is amazing. Russians love Putin because he helped lift everyone up, instead of looting the place for personal gain (sound familiar?). The reason he was chosen to take the helm of Russia was for exactly this reason. He was the only one that didn’t want the job, and felt he wasn’t ready for it. His lack of being power hungry is what got him the job, and benefited the Russian people.
Putin has something like 80% approval ratings for good reason.
I don’t know much about Putin, but I do have the perception of him as someone who cares deeply about his country and his people and I do hear favorable comments about him from some of the Russian ex-pats around here. Being a child of the Cold War, I scare myself when I start approving more of the Russian president than I do my own.
I’ll chip in for the one way ticket to Russia for you.
Why don’t you pack up and move to Moscow? it sounds like a lovely place.
I’ll chip in for a one way ticket for shrub to Iraq.
“Why don’t you pack up and move to Moscow? it sounds like a lovely place.”
No, I think our gov ought to pack up and move to Moscow, because they resemble the old time Politburo more and more every day, what with all the spying and wiretapping, propaganda, et al. Also, Russia has a pres who is trying to hold his country together and handle illegal immigration, while it seems the US pres is doing his darndest to put the US in the toilet, with his fiscal and open borders policies.
‘You think ________ country is so great - move!’
Not surprising - Big Mac chomping, Lazy-Boy reclining, monster truck driving, overweight Americans find it difficult to deal with the fact that the US is a third rate, has been, banana republic.
As they take their well-earned spots among the poverty stricken cardboard box living hordes, I expect they will even then fail to learn the error of their ways…
I’m tellin’ ya, cris, people in the country are so blind they don’t see what’s happening, just slap a little yellow ribbon on their Monster Truck and by God, that makes ‘em patriots. Yet, they’ll buy stuff from China if it’s cheap, never mind the fact that there’s nothing more the gov and their corporate overlords would like to have than a population of robotic workers sleeping on pallets and eating bowls of mush provided by the gov.
WTG - Pootie Poot!
“just slap a little yellow ribbon on their Monster Truck and by God, that makes ‘em patriots.”
I keep looking for a car magnet ribbon in the colors of the Chinese flag that says, “Support Chinese car magnet manufacturers”, but I haven’t found one yet.
I am amazed at the dated and ignorant reactions to Russia on the rise. Get used to it - they have plenty of natural resources of which we will have to purchase. I believe this world cannot handle one superpower (the US), and we need to get back to the days of having a power balance. Russia will play that role again. And yes, I have been to Moscow and St Petersburg several times - every time it gets better.
And to those who think that a US citizen can easily pack up, move, and take citizenship in another country - you are wrong. The US government and the IRS will happily remind you on a regular basis that you will never be cut off from your obligations and privileges of being an “American”. I would HAPPILY trade my US passport for just about any EU passport.
Our Founding Fathers would be ashamed of what has become of this country.
Yeah, we’re sending a message to our troops, all right. “You fight, we’ll have a housing bubble”.
I’m not going to get into the political end of this discussion, but for Left LA, the technical answer to his/her concern is here:
http://travel.state.gov/law/citizenship/citizenship_776.html
http://www.slate.com/id/2104878/
It is called renouncing citizenship and does not appear particularly difficult to do.
The hard part is not renouncing citizenship. The hard part is getting another citizenship to replace it. Unfortunately, that is a necessity these days unless you have a LOT of money (think Bill Gates’ level).
Same deal with people who hit the Lotto for millions. In the end, most wish they had never won.
I have a lady friend with fused vertebrae and in need of corrective surgery (the first of many?) and limited movement at her neck and lower back. She refused the insurance settlement offer for $100k, and she has an attorney suing the driver at fault. Not sure how good the at fault driver’s insurance is, but the at fault driver is worth millions so too bad for her.
I am gonna be giving her a book to read and other good advice, but I think she will piss it all away.
http://tinyurl.com/2z6h3g
Got 10% down?
I am always amazed/amused when I read stories about million dollar lottery winners who end up broke.
Weeeeeee, I can not afford two pickup trucks and a boat. Weeeeeeeeeeeee
Welcome to planet reality. Weeeeeeeeeeeeee
Foreclosure glut in South Hillsborough County, Tampa Bay area. This little paper is what we call the “local fishwrap”, a weekly paper that has served this area for many years, with news of local events, births, deaths, etc. The foreclosure glut in the area has gotten their attention. The local seafood festival ought to be a real hoedown hootenanny this fall. All the local real estate firms set up booths there.
http://www.observernews.net/artman2/publish/Top_Stories/Foreclosure_Disclosure.shtml
“….At one foreclosure auction last week at the county government center, not a single buyer entered a bid.”
But, but, they’re not making anymore land.
Hate to tell ya but they are making more land at Pensacola Beach. Matter of fact added about 30 yards onto the beach. Sucked up the sand offshore and deposited it on the beach. One short lived but positive benefit is that there are shells on Pensacola Beach which haven’t been seen in probably thirty years.
Of course the next hurricane will blow the sand right back out into the Gulf but who cares if a few million bucks gets washed out to sea every few years?
But, but, they’re not making anymore land.
My favorite response to this answer has always been “So where will all the newer, bigger roads go to handle the onslaught of people?” and “So as prices go up, the lower class who works the jobs in the stores and restaurants won’t be able to afford the ride to work there, so who will?”
But land is the best investment. This was on Craiglist for Washington DC houses today
http://washingtondc.craigslist.org/doc/rfs/423751698.html
The Best Investment on Earth - Future Land Investment
——————————————————————————–
Reply to: hous-423751698@craigslist.org
Date: 2007-09-16, 4:55AM EDT
The Best Investment on Earth
http://www.youtube.com/watch?v=E9z9fnKSqgI
The secret to building wealth is investing in vacant land.
bella vista village is located in benton county the 3rd fastest growung in the USA.
there are 8 beautiful lakes in bella vista village for fishing, boating & water sports.
if you enjoy golfing bella vista village has 8 golf courses to choose from.
there’s no time restriction on building & lots are complete with full utilities.
get great return on your investment.
buy vacant lots in bella vista village.
WHY INVEST in Land in Arkansas?
* Prices Going up Rapidly
* Liquidity, you buy 10 and can sell 1, 2 OR 3
* Easy Maintenance, Low Cost
* They Don’t Make Land Anymore
* Timing, Timing, Timing!!
Call Joseph at (754)423-3581 or email 2zeca@bellsouth.net
A couple of good articles on the front page of the Orlando Sentinel too.
“Stalled growth may cost schools
Districts get state money based on enrollments, and the recent trend won’t help.
Dave Weber | Sentinel Staff Writer
September 16, 2007
The gold rush is over in Central Florida public schools, with growth in student enrollment slowing to a dribble this year.
Across the five-county Metro Orlando area, only an additional 730 students showed up for classes compared with a year ago. That’s a minuscule increase –barely the equivalent of a single elementary school — after decades when Orange County schools alone might have picked up an extra 6,000 or more students each fall.
A little further down the page;
“The slowed enrollment is part of a statewide phenomenon that officials have-not been able to explain fully. Expensive housing, reduced job opportunities and hurricane fears are getting the blame for families leaving the area or not moving here, but no one is exactly sure what is occurring.
Statewide, Florida schools added only about 500 students last year, after gaining as many as 58,000 students a year during the past decade.
Last year, 29 of Florida’s 67 school districts had declining enrollments, and several districts were taken by surprise.
State Department of Education officials are uncertain whether the slide will continue this year. A statewide student count is set for early next month.”
Some parents may not want their children in institutions that are little more than gang recruitement centers. Unfortunately, this is a trend that will not be limited to FLA and Cali.
Yes i sell Primerica Financial Instruments, Kline said: i was on a career path to make six figures with a fortune 500 company, and my mentor said they weren’t making any more land in Florida.
——————
Kline, a Maryland resident and financial consultant,
“On a career path the make six figures with a fortune 500 company”
ummmmm…no. Very few Primerica salespeople make six figures Mr. Kline. Just because you get a license that lets you beat a little old lady over the head and sell her a load fund or variable annuity for a commission does not mean you will make 6 figs like they pretend you will.
This is the kind of financial consultant the service economy now produces. Men who might have made themselves useful on a production line now sell financial “products” to those even more clueless then themselves. Man admits he did no research or homework, decides to build two spec houses in a distant state where the market was already in serious decline. Even if he doesn’t read anything, did he not walk around the area where he built these houses, talk to anyone in a coffee shop, or notice the for sale signs? Truly, blinded by greed.
How did he get the f—ing loans? That’s my question.
LOL. A couple of years ago my wife and some of her co-workers were approached while walking through a mall, and were talked into attending one of Primerica’s recruitment sessions. My wife asked me to come along as a reality check in case she started drinking the Kool-Aid. We went to a local hotel, where Primerica had staked out a large presentation room. A couple of smooth-talking people in nice suits, aided by plants in the audience, then combined to give a high-pressure pitch that made me uncomfortable from the first minute. We could not get out of there fast enough. It felt like “do this, you idiot, and you’ll get rich like me.” It also sounded like the typical marketing scheme where people are encouraged to treat their neighbors, friends and family as little more than another marketing opportunity.
Exactly, its just another Avon lady, tupperware, Amway, YTBL, network marketing, ponzi scheme using loaded financial products as the gimmick. Be careful out there!
Wait until the American Cash Flow Institute (AFCI, out of Orlando) really gets cranked up. In recessions, desperation drives customers to various schemes and scams. Of course, the media will love it, since those full page ads about seminars “coming to a motel conference room near you” will take the place of all the developer blowout sale ads. Advice to media: get your money up front!
Advice to media: get your money up front!
—————————-
SAD to say most DON’T…..most are 30 day net, so they can run quite a few commercials, then the company pays off a few months and they Increase their credit limit so More ponzi scheme ads…until they fold and TV Radio stations have to write off the bad debt. I seen it a lot working in TV, the salesmen wont talk about their bad accounts.
“Bench owed $167,634 on a house that, according to the Hernando County Property Appraiser’s Office, has a market value of $131,000. At one foreclosure auction last week at the county government center, not a single buyer entered a bid.”
I don’t know what sort of a house Bench purchased, if it was new or an older Hernando County home, but seriously, Hernando has been listed in the past as one of the poorest counties in the state, next to Sumter County. Anecdotally, wages in Hernando support homes in the $65,000.00 range, $85,000.00 max, for the general population.
Of course, all the real estate agents hyperventilated about the Suncoast Expressway, which did make the commute to Tampa a lot easier. So the Spring Hill area of Hernando saw a boost a few years ago, until people’s yards, houses and streets got swallowed up by sinkholes. For a while there, it seemed like you couldn’t turn on the evening news without seeing a story about a new sinkhole opening up in Spring Hill. (Talk about a Grand Opening, lol!) Which of course boosts insurance rates big time.
I just went to Spring Hill on Friday on business. Stopped at a Parkview Homes community just for fun and the sales rep was gushing all over me. Poor guy sure seemed desperate and wouldn’t let me see the models without walking and talking every inch of the way with me. Prices still too high for such an out of the way place, and there is a lot of traffic on the Suncoast!
The substrate (area below the surface) of large areas, particularly the central areas, of Herando and Pasco Counties is like swiss cheese. I wouldn’t buy a house in either county, unless it was an older home in a long established neighborhood, without an independent geologist’s report. About a year ago, there was a story on the local NBC affiliate about a developer in the area who was building homes over ancient sinkholes, with impunity, because there was nothing to say he couldn’t do it. Think he discloses this to potential buyers?
“The monthly mortgage payment, $1,240, seemed high, considering he clears only $1,400 a month.
Gee, ya think? and how did he figure to put food on the table, or fill his gas tank while he was waiting for his chance to refinance? The guy is functionally retarded, and should be prohibited from signing legal documents.
And this should show everyone exactly why the credit market is blowing up; there was a lot more of this going on than the markets imagined. Also, how could this guy possibly be bailed out?
Realtors ™ convinced him that this was the lowest prices would ever be seen. If he didn’t buy TODAY, he would be “priced out forever”. He needed to step on the property ladder to success. Don’t worry about the payment. When property prices doubled again in a year or two, he could take out $100k in equity. Then he would be successful and get out of that low -paying job……maybe get into buying properties.
He bought the “dream” the Realtors ™ sold. I have heard their scam stories myself and can attest to their delirious view of the world. Both fear and greed rolled up into a simple sales pitch. If you buy now, you’ll get rich, if you don’t buy now……you will be poor forever!
Sorry so many people listened to the David Lereah’s of the world and their ilk. Don’t miss out on the real estate boom!! It won’t bust!! Blah…blah..blah.
Thanks NAR. You’ve helped a lot of people go broke.
“Thanks NAR. You’ve helped a lot of people go broke.”
You’ve helped America go broke. And you had a lot of help in the process.
Yeah..NAR and David Lereah royally screwed these poor rubes royally.
You’d think that the least that the new and improved management of NAR and the casinos could do was to charter a few planes to Vegas/Atlantic city and allow them to invest or win their loses back
Elmo Bench? ELMO BENCH?
Poor fellow never even had a chance.
Somebody tickle him.
“The monthly mortgage payment, $1,240, seemed high, considering he clears only $1,400 a month.”
We really do have a nation of idiots. You read that and have to wonder. I mean did this guy at least graduate from high school?
I drove the Suncoast Expressway for the first time last week. Right around the Pasco/Hernando county line is a huge McMansion subdivision called “Trillium.” I almost exited the highway to check it out–all I could see from the road were dozens of two-story boxes ten feet apart, identical but for their differing pastel shades. If the idea is that people who live there will commute to Tampa or Clearwater or St. Pete, that’s a bad idea.
Come on Palmetto, your living in the past.
The incomes used to support housing prices in the 65-85k range. But, that was before new “Financial Products” allowed people to step up on the property ladder.
Where have you been? Head in the sand?
You can get a 1% Quicken Loan. I still hear it on the radio. That means they can easily afford this house.
What a farce! Can you believe how stupid and irrational people have become with the last bull session of Realtor-speak(tm). Don’t miss your chance to overpay.
I can’t believe it, either, diogenes. Hernando County is interesting, it has rolling hills, some springs, some good fishing and boating, Brooksville has some old Florida charm, but NO WAY can the general population support homes over $85,000.00 and that’s pushing it, IMHO. It is completely a service economy up there, except for Tampa commuters.
I agree completely, which is why in 2002 when i first started looking to relocate from Tampa to Clearwater, I stopped. Dead cold. Prices had begun to climb and I bid wars had started on already overpriced houses built in the 50’s.
Why is this happening I asked?
The Realtors ™ had all the answers….you know the list…baby boomers, rich foreigners, no land, etc. But I had on simple metric…..WAGES.
Traditionally, house prices have tracked incomes based on people’s ability to pay. Cheap mortgage money allowed people to over-reach.
But I knew it wouldn’t last and when lending conditions turned around, the prices would need to fall. Period.
Starting here in 2001/02 prices disconnected from incomes. That is my target price range, plus around 20% inflation adjustment for the past 5 years.
We have a long way to go.
-D
Spot on Diogenes! I remember 2 years ago telling people the market was driven only by speculation, and that income/price and rent/price ratios were unsustainable. They looked at me like I was from another planet. It’s amazing how far a trend can go on nothing but pure hype! Now pure fear will drive the market back down below the fundamentals. That’s when I’ll be buying.
I’ll be in Tampa Tuesday and I’m looking forward to looking around at the real estate situation. I drove through Fishhawk in 2005 when it was booming and couldn’t believe people were paying that much for homes with only 2 streets leading out of that subdivision. I knew the traffic would be horrible, but everyone thought Fishhawk was fabulous. Stopped in to look at the new townhomes and they had a waiting list. Not impressed at all with the townhomes. Maybe we could have an HBB social get-together in Tampa next week. Anyone interested?
I live in Fishhawk Ranch, Barbara. Have to work that day of course. If there is anything you want to know about Fishhawk now I can tell you. Big surprise…there are no waiting lists now! The only waiting lists are for the realtor’s lining up to find buyers. It is a very nice communities, and we’ve got some great, way overpriced values for you here. If you want a big laugh, check out the home on the corner of Bridgevista and Churchside, very first home when you enter “Bridgeview”. Well over 400k and about an 8X8 kitchen!
I live in Tampa between Ybor City and Brandon.
Tuesday night is my usual practice session with some friends, but we usually don’t start till after 8pm, sometimes 9.
If you want to exchange war stories, perhaps there is a meeting place somewhere near. You may even be able to drag Palmetto up from south of us.
Got a potential venue?
I wish you wouldn’t have made a long Florida posting today of all days, Ben. I’m almost out of time to get to K Hovnanian’s Deal of the Century weekend! Hurry, folks, this is the last day! Prices will never be lower, at least not for the rest of this century! AND, you can win prizes like….you guessed it, a big screen TV!
Yes, they had a story on the local TV news about the Hovnanian fire sale, LOL.
So now they are selling houses like those annoying new car dealer’s radio ads.
HURRY HURRY!
THIS WEEKEND ONLY!
WE ARE AUTHORIZED TO LIQUIDATE OUR ENTIRE INVENTORY AT UNBELIEVABLY LOW, LOW, LOW PRICES! BUT YOU BETTER HURRY BEFORE WE RUN OUT OF
CARSHOUSES!HURRY HURRY!
Got 10% down?
I hope that tomorrow someone will report about the results.
How do you make $350K a year and have nothing? I guess there’s never a tomorrow and you don’t have to plan for the future. They’re acting like $60K/year is ghetto time - I suspect many people would be thrilled to make that much. I feel sorry for kids who have been lead down the path of thinking they deserve the good life or have no clue that their parents did nothing to provide for their future.
Some people deserve to take it in the a$$, this couple is in that group. As far as the kids of these types, I looked in the sympathy cupboard and it’s bare.
Seriously. Then again, we could start a Children Network Fund where, for just the price of a cup of coffee at Starbucks (or about $15/day) you can sponsor an underprivileged-privileged child who’s parents are financially neglectful and inconsiderate. Once a month you’ll receive an update on the child or children you’ve sponsored, along with a complete rundown on their “acting out” due to their unfortunate situation (not having enough money for an 8-ball or being forced to drive a Saturn to the local swim club instead of having a red Mercedes convertible).
So please, won’t you make that call today … the children.
Seriously. Then again, we could start a Children Network Fund where, for just the price of a cup of coffee at Starbucks (or about $15/day) you can sponsor an underprivileged-privileged child who’s parents are financially neglectful and inconsiderate. Once a month you’ll receive an update on the child or children you’ve sponsored, along with a complete rundown on their “acting out” due to their unfortunate situation (not having enough money for an 8-ball or being forced to drive a Saturn to the local swim club instead of having a red Mercedes convertible).
So please, won’t you make that call today … for the children.
Sadly, this is how the majority of Americans manage their finances. When times are good they party like rock stars like there’s no tomorrow. Savings? We don’t need no stinking savings.
When financial planners, financial consultants, and others are getting people to speculate with their life savings in highly leveraged stuff, and financial magazines feature front cover stories on the highly leveraged, then why would it be so surprising?
‘I shouldn’t have been speculating in an arena I had no knowledge of.’”
With a financial consultant like Jonathan Kline, who needs enemies?
Got 10% down?
Vacancy rampant in Lee County homes
http://www.news-press.com/apps/pbcs.dll/article?AID=/20070916/RE/70915039/1075
Really Ugly!
Its eerie! Every thing that we thought would happen 2 years ago is happening, and then some.
Does everybody remember the MONEY magazine article from 2005 talking about the housing boom. They should do a “Where are they now” piece about the people in that article, especially the young guy from Minneapolis that had bought like 15 condos sight unseen saying it was a “no-brainer” or the mortgage broker from Vegas who made like 250K a year and was in Arizona looking for a home he had bought sight unseen also and did not even know where it was. Hysterical times!
Yeah, I just couldn’t resist reviving this classic…
http://www.nytimes.com/2005/03/25/business/25boom.html?ex=1190088000&en=5b9e48ee64751fa8&ei=5070
> “Every thing that we thought would happen 2 years ago is happening, and then some.”
What’s scary is the things that we’ve talked about for the past 2 years but still haven’t happened yet. Like: a dollar crisis, widespread bank collapses and another great depression.
With our batting average for successful predictions up to this point, I’m afraid we may have guessed right across the board.
Got gold?
yes. I do.
Yup.
I totally remember reading that article when you mentioned the punk from Minneapolis. In 2005, I was in the middle of my medical residency, working 80 hours/week plus studying, while this guy was flipping condos. It made me so mad to read that article. Now I’m out in practice, happily renting, accumulating over $100k in my down payment, and waiting for foreclosures from shmucks like him to come on the market. No bailout!!
I think I saw both of those guys plummeting from a suspension bridge the other day, then again it could have been some other flippers.
Missing Fort Myers real estate tycoon, Frank D’Alessandro.
http://www.news-press.com/apps/pbcs.dll/article?AID=/20070916/NEWS01/309160004/1002/NEWS01
Where is Frank D’Alessandro?
Did he have to answer to the Soprano’s in New Jersey, or did he just decide to disappear.
“‘I feel like I should be going to a higher place in my career,’ she said. ‘Instead I’m taking 20 steps back.’”
Lady hate to break it to you, but you’re a run of the mill salesperson that happened to get lucky one year. That’s not a “career”
As machinist with 20 years experience, I feel like I should be going to a higher place in my career too. Not happening, thanks to our government’s trade policies.
Silly you…productive work is so 20th century.
Only in America.
“Silly you…productive work is so 20th century. ”
Why would WE want to make anything when China can do it for pennies on the dollar…
Repeat after me “service economy”
Assets? We don’t need no stinkin assets!
Yes sir, it is important to remember that a large economy so heavily dependant on services and consumption has yet to face a serious test. Thus far we have merely inflated our way past any potholes.
Service Economy: “Sucking phucky, five dollar. Me ruv you rong time.”
LOL
It’s tough to make a living competing with near slave labor. That’s the bugaboo in this whole free trade fantasy.
Testify! A pallet and a bowl of mush for everyone!
Let’s all chip in a by her a copy of “Who Moved My Cheese?”
http://www.whomovedmycheese.com/
http://www.amazon.com/Moved-Cheese-Amazing-Deal-Change/dp/0399144463
During the last mini-recession HR here ordered this book for the library at work to show they ‘cared’.
“Does everybody remember the MONEY magazine article from 2005 talking about the housing boom. They should do a “Where are they now” piece about the people in that article, especially the young guy from Minneapolis that had bought like 15 condos sight unseen saying it was a “no-brainer” or the mortgage broker from Vegas who made like 250K a year and was in Arizona looking for a home he had bought sight unseen also and did not even know where it was. Hysterical times! ”
Like the laws of inertia, what goes up at a skyrocketing rate will eventually come down at a skyrocketing rate. I don’t buy what most of the HB crowds says in that housing will be sticky or that we’ll lose most of the housing bubble’s gains through inflation. I think we honestly could see 2000-2001 nominal pricing by this time next year nationwide. Problem is, most people don’t have the physical cash to buy housing even at 2000 prices so they could fall further. An actual 10 - 20% drop in housing can cause a lot of pain; a 50% or 70% or even a 90% drop can be a nightmare.
“I feel like I should be going to a higher place in my career,’ she said. ‘Instead I’m taking 20 steps back.”
When I was growing up I regularly watched grown men with families and mortgages get the pink slip from Xerox and Kodak. In high school my economics teacher was quick to remind the class that we would be the first generation to make less than our parents.
I’ve never had the expectation that my career(s) would be linear and that advancement is guaranteed. This attitude has served me well. I’ve always enjoyed everything as I’ve gone along, but squirreled away enough for for short times. All of this while I was single. Now that I’m married and starting a family I am even more cautious and thoughtful with my funds.
What the hell is wrong these people? If I had made $350k last year I would have $300k in the bank. Moreover, you can never assume “things will stay the same;” it’s the natural order of things that they don’t.
Beautifully put. My sentiments exactly.
What the hell is wrong these people?
what’s “wrong” with these people is they are not happy with what they have.. being content is a learned character trait.
Money changes nothing, for when they spend it and buy more stuff, they are still not happy with what they then have. Having stuff is not satisfying.
Money has functional limits, like a volume control.. it intensifies what a person already is, but it can’t change the channel.
“what’s “wrong” with these people is they are not happy with what they have.. being content is a learned character trait.”
Caddy Shack:
Kid: “I want a hamburger, no, I want a cheesburger, I want a milkshake, I want potato chips, I want frenchfries…”
Judge Small (Ted Knight): “Shut up! You’ll get nothing and be satisfied!”
No, you would have paid about 140k in taxes…so you’d have about 160k.
Of course you’re assuming the I.R.S. knows they made $350k. Something tells me they didn’t - just a hunch.
Their ‘home equity’ went up $350,000, so they ‘made’ $350,000. Sh!t, why NOT spend it!? LOL
It probably would be even worse if we factor in AMT.
The problem is that the media is constantly glamorizing being rich, and people adopt a “get rich or die trying” attitude. The second they get some cash it’s time to catch up to the Jones’. The media plays a massive part in all this, since their job is to increase sales for their advertisers, so what did you expect?
“Lifestyles of the Rich and Famous” started this plague IMO.
I finally achieved middle class-dom right when the housing bubble hit, and to me it sure looks like get rich or die is truth. People that have a lot of money are given more money, and people with a little money have it taken from them.
I’m opting for having no money, or getting rich off one of my inventions…which will probably mean no money. The alternative is to spend my life making rich people richer.
Seems like human societies always end up as some kind of feudalism. The sad thing is, at least this time, the serfs have the freedom to chuck it…they just don’t realize it.
“…the serfs have the freedom to chuck it…they just don’t realize it.”
And they don’t necessarily want to realize it either - so much bling to buy - so little time to shop.
That shopping thing is gonna halt soon. The retail numbers were lousy, there’s no more equity to squeeze out, and cc speing jacked up last month, probably to smooth out the rough spots equity extractions used to cover. October resets in the bag, food costs exploding, and heating season is coming on…bling is done.
You know things are bad when Coach(expensive designer handbags) sends you a “coupon” in the mail! Got mine yesterday…
Hey Muggy…sounds like you grew up in Webster or Penfield? What High School did you go to?
Muggy:
So, how is good ole Rochester? I’ll have to take a trip back home to see the family and visit Nick Tahou’s, Schaller’s and Abbotts.
“North Port’s August building permit numbers are down 89 percent compared with the same month a year ago. ‘I believe that that this is the bottom,’ said Ron Hill, president of the Charlotte/Desoto Building Industry Association. ‘If anybody is interested in getting a deal on a new house, there’s no better time than right now.’”
I have to be honest, I am a little surprised these type of clowns are still making these comments, its so 2006.
Ragerunner, don’t be ridiculous. You’re a fool. You’re going to miss a golden-wave of affordability. It’s patenty obvious that there’s no better time to buy than now. You need to buy RIGHT NOW.
Please?
Please??
No, really, I’m fighting with my wife over every dollar. Buy one of these damned houses! PLEASE!
It’s like ol’ Gil from the Simpsons . . .
“Home prices in Port St. Lucie, which had a median price of $226,400, were overvalued by 40 percent, according to the study.”
That’s not good for family business. They bought two in the 250K price range.
Can anybody find anything in the PNJ article that supports the “Home Sales Stabilizing” part of the lead? I don’t know but I just can’t get that warm fuzzy feeling that things are stabilizing unless the lead means stabilizing in a downward trajectory.
Let’s see:
10,000 homes divided by 500 sales = 20 months of inventory. Yikes! Anybody planning to sell their house in the next two years better hurry up and get your house up for sale since the waiting line is 20 months.
The guy that compiles the housing statistics (MetroTrends):
“”Overall, there has been little change in the trend of a steady decline in the number of sales,” said Muller, whose company tracks and analyzes housing data for private clients. “There is no indication of the market stabilizing in Escambia and Santa Rosa counties.”"
Oh, oh, looks like P’cola is counting on those crazy Boomers to bail out the local housing slump:
“The most important demographic trends of the early 21st century are baby boomer retirements and movement to the coast, and they will trump any other concerns and work in favor of growth in Northwest Florida,” said Harper. “This growth dynamic will assist in a recovery from the current housing slump.”
To be fair, at $350K, the taxes take 50% of it, so only $175K left.
You get a fancy house, two cars, and a boat, and the carry and deposits on those, and it’s easy to see why there is nothing left.
Apparently not so easy for them to see.
If they think used houses aren’t selling, wait until they try to flog a used boat.
I find it hard to believe that taxes take 50%, in a state with no income tax, and if you put as much as possible into retirement accounts first. Especially if you have a business, in which case you should have a profit sharing plan that lets you put quite a bit away.
But that would take thinking and planning, which obviously wasn’t their strong point.
Actually, if married filing jointly for 2005, the top bracket of 35% didn’t start until $326,450. It was 33% from $182,800 until there. So they should have had at least $235,000 after taxes. Saving $150,000 out of that amount should have been quite easy.
If they weren’t morons, that is.
“‘We are in a real estate recession,’ said Laurance Baer, manager of the Fort Myers-based Baer’s Furniture chain, where sales are plummeting. ‘And we have an economy that’s much more tied to real estate than anyone realized.’”
No, it is called denial. Those of us who “realized” it years ago were laughed at and given all the “Real-estate never goes down”, “They’re not making any more land” and “Buy now or be priced out forever” clichés. Do you really mean to tell me that you did not think our economy was closely tied to real estate, Laurance? You are a FURNITURE STORE manager! You have now declared that we are in a real estate recession, and are talking about our economy (or at least your local economy). That means you fancy yourself at least somewhat knowledgeable about economics. You should have been thinking about how it will affect YOUR business, and then drawn the logical conclusion that any slowdown meant realtors, mortgage lenders, and home builders would be quickly affected. Then, you draw the natural conclusion that this will lead to the loss of jobs in those areas, which means less spending by them, which means other businesses are affected too, and that home inventories may be high. And that is only the very beginning of the vicious downward cycle. You can’t have it both ways. You are either an innocent furniture store manager who doesn’t know any better, or you are knowledgeable about real estate and economics and should have seen it coming. Which is it?
“‘I bought these houses, but I sure as heck didn’t do my homework,’ Kline said. ‘They never told me how bad it could get.’”
This is clearly one of the things wrong with the people in this country. Zero critical thought capability. They are always expecting someone else to tell them what to think.
“They” aren’t supposed to tell you. “You” are supposed to have done your homework, reading about past boom and bust cycles. “You” have nobody to blame but yourself.
This country is loaded with morons.
“I bought these houses, but I sure as heck didn’t do my homework,’ Kline said. ‘They never told me how bad it could get.”
Sounds frighteningly like “I pulled the pin on that hand grenade but I sure as heck didn’t do my homework,’ They never told me how bad it could get.’
Got grey matter?
Tomorrow I board my plane to WPB, FL to start my new life there. All of my planning and saving for the last 5 years adds up to 150,000 in my savings account for the dream home that I should have been rewarded with for the dedication and hard work we did.
My plan was to purchase a 200,000 home with a small 50K mortgage and live like a king in Florida.
As I write this with complete bitterness and such anger towards all of the parties responsible for wrecking my dream of home ownership. I wish to personally flip off Greenspan, NAR, Banks, flippers and speculators.
Now, I will be looking for a rental home to wait for this nightmare to end and pray Florida will somehow become the paradise it used to be.
I am leaving my home country of Canada to live in the USA for the first time in my life. What a crock of _________.
My dream home should have been in Wellington, or Royal Palm beach.
Now my 150,000 looks like chump change and my wish for a 200,000 dream home makes me look like some poor stupid idiot.
It is still to early to low ball down from 350,000 to 200,000 without looking like I am smoking crack when the real crack smokers were the above mentioned parties.
I am pissed more than the words on this rant could possibly show.
My American husband endured living in Montreal for the last five years with CBP, being deployed to Iraq with his Air Force reserve unit for six months. Putting up with my continued pushing for more overtime, us working four jobs…for what?
Some financial genus I am.
Try not to be so hard on yourself and pissed, SKB. Give yourself a lot of credit for saving up 150k, something that is very difficult for many to achieve. Don’t look at renting a home temporarily as a negative because it really isn’t. Your timing is actually not very bad. This will give you the opportunity to live in the area, and do extensive, first hand research as to where you want to live, what kind of home, neighborhood, neighbors, etc. I’m sure you’ve been there before and have a pretty good idea but things may change a lot in the next few years. Go down there, rent something that you can be happy in, keep saving, and you will in all likelihood be rewarded by being able to buy what you want at the price you want soon. Think of all the fun you are gong to have lowballing the flippers and speculators that helped screw up your plans! I’ll just add…many, many people would love to be in your shoes now. Moving to Florida with 150k cash in hand heading in to a soon-to-be buyers market is enviable. Life rarely happens the way you plan it. Keep up your patience and hard work and I’m willing to bet you will be rewarded.
Don’t get down. I moved to PBC earlier this year and the train wreck is just beginning. My wife and I keep a stack of real estate flyers from last fall (West Boca to lower Wellington) just to remind up how buying a house would have been a huge mistake. Almost everyone is still on the market (relisted of course with a newer MLS and 15-20% lower)
Keep you money safe, rent cheaply in a good development and enjoy the show from the sidelines. I’m being subsidized about 1500 bucks a month by my generous landlord in a new development in W Boynton
pardon my asking, but of anywhere in Florida, what on earth is in West Palm that would make you think of pulling up your stakes and moving there?
Well, my husband had to put five places on his “dream list”. We had also put Tampa, Orlando, St Petersburg and Clearwater on that list.
What area would you have recommended?
We had put WPB because of the sea port experience for my husband and his career. He has worked land and air but never sea.
To be honest I had always heard that of all of the areas WPB was the most beautiful. It was also highly recommended by others when I posed that question on other message boards a year ago when we had to make the final decision.
I hope we will be happy.
I think you should be happier with the situation. You should rent for a year or two and figure out the area. It might turn out that you don’t really like it all that much afterall, therefore saving your $150k from a mistake. I moved to San Jose, CA based on several trips and what people had told me, and it sucks here. I can’t wait to get out, and not just because of the housing bubble. California is very similar to Florida, IMO, and moving from Montreal you may find it doesn’t like up to the hype you have created in your mind.
No offense but who said I have created any “hype” in my mind over Florida?
I am not even from Montreal, I am from Winnipeg a small city out in the Prairies.
My husband works for the USA Government and we have been posted all over the place since 1999.
We have to return to the USA and we picked Florida due to family and my husband’s career.
Montreal was filled with language challenges for me and I made the best of it.
I made the best of it in Nassau, and I will make the best of it in Florida.
I realize Fl has insurance problems and SOH problems but I am hoping that these issues will resolve themselves when the housing market finishes crashing.
My recommendation is to go to St. Pete..Orlando is highly congested and well not so great with real estate of all the choices..West Palm another blah..St Pete is interesting and has nice beaches on that side of the coast and areas to easily travel too..Tampa..is well backwards and boring..(Pizza shop closes early on a Saturday night and housing is built strange over there..you have commerical mixed in with residential and old roads..reminds me of Miami back in the day..)
I’m sorry, where do you get your info??? ST. Pete??? Love the place, boat there all the time but come on! It’s not the best place in Florida to be. What are you talking about Tampa boring. Have to know, are you a native or transplant???
Native Floridian here, moved out of Wellington 3 years ago. You really need to find another place to live. West Palm is nowhere near the nicest area in Florida, IF you HAVE to move to Florida (like there is a gun to your head) I would look at the west coast much better deals or Vero Beach area on the east coast. Sad to say you savings will not be enough to buy anything decent for at least 2-3 years. They drank the cool aid for a long time there. Have you checked the crime level for WPB? It is through the roof. I cannot with good conscience let anybody move there without warning them of the EXTREME PROBLEMS Palm Beach County and surrounding counties face and will deal with for years.
Well, those options are to late. My husband has accepted his job in WPB and he is driving there as we speak.
If we find the crime to bad for us we will go to Port St Lucie (ranked very safe city) and he will commute.
We do have three dogs and my husband is in law enforcement so we do know how to protect ourselves.
I spent months deciding this, and City-Data forum was at that time very pro WPB and helped me make my decision.
I have rented a place in Little Ranches for sixty days while we look for a permanent rental.
If we have to wait years we will before buying. I am not going to make a mistake.
I will let you know how it works out for us.
Thanks for your concern.
Don’t trust everything you read in City-Data(the whole idea is not to let their city look bad)…Port St Lucie isn’t bad but you will be very disappointed in WPB especially if you have kids and put them into the school system there..better train them to take care of themselves…Like I tell my kids some have to learn the easy way and others the hard way..Good Luck you are going to need it in WPB..
SOunds like your kids are having to learn it the hard way. Hopefully they can learn to be a little more optimistic in life.
SKB:
Now that you are going to be putting your long term plans into action in FL there is something that you should not forget:
Keep your saved money safe!
In the USA FDIC insured depositors accounts and CDs are not as safe as people think it is. If the institution fails then your money could be locked up without getting any interest for years.
I would not use an institution just because it is “too big to fail”. Citibank just loaned $14 billion to a mortgage lender, GMAC mortgage.
http://tinyurl.com/ywj7cn
In my opinion, Citigroup is not too big to fail. Citigroup is hiding their own MBS and CDO portfolio to avoid having to take losses before CEO Prince can collect on his bonuses and stock options. I predict Citigroup’s losses are going to be in the tens of billions, and if they keep lending tens of billions to mortgage lenders (making new mortgages when the price of houses has just just begun to slide in the mother of all housing busts is a failed, failed, failed business model) like this then their losses could be in excess of one hundred billion $.
Now is not the time to be chasing after high yields. Consider money markets that only invest in Federal bonds. I like Vanguard’s Fed bond money market but there are other reputable Fed bond money markets funds.
Good luck in FL, and congrats on your hard earned and saved little pot of gold.
Got 10% down?
My Indymac CD’s have been maturing and I have been cashing out and putting my money in the Emigrant Bank. I am getting 5.05%. Indymac was trying to lure me back with 5.75 but I am also to nervous to stay there. It seems like they are looking for more money. In five years not once have they sent out e mails of CD deals.
They did a small amount of Sub-Prime but a lot of Alt-A.
IMO, you should keep your money in Canada. The $Can should go way up relative to the $US, as the Canadian government is in surplus as opposed to the gigantic deficits here.
West Palm is not for everyone. Some of the regulars on this blog appreciate it, but I had a job interview there in 2004 and was turned off almost instantly. I also know several people from Tampa who relocated there and who were back in Tampa within a year.
This is not to say that Tampa is capable of driving people away as well. It all depends on your personality. I came here on a job interview fifteen years ago and knew right away that this was where I was going to live.
I was just in WPB and found it to be a lovely place. Went to a breakfast joint where all the locals hang and read the paper. Talking with them, found the place has many perks. Remember one persons paradise is not anothers! I heard the same comments moving back to Florida! I love it here and find the good far out weighs the bad! I am even embracing the abrasive NY’ers who I so despised when I first came back! Deep down after all their complaining….many of them have hearts of gold! You can make anything work. You’ve learned by moving around, it’s easier to embrace your environment than to complain and wish it were different. Good luck! You will love it here!!!
Yeah, it’s finally here! Renting has it’s advantages. SKB, we left Florida to make more money so we could live comfortably. We came back during the height of this insanity! Basically pissed away every penny we saved. Had we stayed, we would have made more in equity on our tract home! So we decided to rent for less than the cost of owning. Some days I want to have a home of my own for my children…… but then it is rather fun to watch the drop. Especially watching the realtors and greedy Homedebtors trying to cash in on their homes have to lower, lower, and lower their homes until……short sale….foreclosure……. Go to the beach, embrace the lifestyle and just kick back and watch the show.
Just got back from a business trip in Phoenix and I couldn’t help but look out the window on our plane and notice the huge and seemingly unending amount of vacant land in this country.
This nation is still practically empty.
You’re. They’re not making any more land because there’s glut of it. I fly often for work. It amazes me how much land is out there. Maybe not all of it buildable but LOTS (pun intended) of it.
SKB, you may be able to get your dream home sooner than you think and maybe even for cash. Here’s a little link so you can find REO property in Florida.
http://www.biggerpockets.com/bank-reo.html
Don’t despair. You CAN still lowball, especially if the bank knows you’ve got cash.
Thanks Warrior and Palmetto.
Support is very much appreciated at this point.
To be perfectly honest I am scared as hell.
I have never been to WPB but after all of the research I did over the last five years this was the place I thought would be perfect for us.
My husband can work the Sea Port to add that to his resume and I could have a nice place so I could buy a couple of horses to resume my hobby of riding and showing.
I will check out that link thank you so much.
Wish me luck, as I travel tomorrow alone by plane with my little dog and cat.
My husband is doing the drive with my son and two other dogs and a bird. My nerves couldn’t take a road trip like that.
My brother in law is picking me up in Miami. I am anxious to see all of the for sale signs and everything else that I have read about from this wonderful blog over the last year.
Thank you Ben for providing this avenue. I promise you one thing, when I get my dreams come true, there is going to be a nice donation coming your way. You have my word on it.
SKB
Never been there? You are in for a shock I bet, probably nothing like you envisioned. By all means, rent, look around all areas and take your time. Do not repeat the mistakes so many made over the last few years. Great luck to you and please keep us posted.
Oh you can count on that. I am a very careful bear.
I know I will like Florida, before we came to Montreal, we lived in The Bahamas, (I hated that experience) the only times I liked being there were the times I could fly to Florida for shopping and visiting our family in North Miami.
Thank you so much for your kind words.
I will be posting questions over the next while if we do start low balling.
I will not buy without consulting the experts on this site.
I do not want to make any mistakes.
Oh you can count on that. I am a very careful bear.
I know I will like Florida, before we came to Montreal, we lived in The Bahamas, (I hated that experience) the only times I liked being there were the times I could fly to Florida for shopping and visiting our family in North Miami.
Thank you so much for your kind words.
I will be posting questions over the next while if we do start low balling.
I will not buy without consulting the experts on this site.
I do not want to make any mistakes.
SKB,
Don’t be scared away. Just do your homework and rent in one of the better areas. If you know what SE Florida is and isn’t then you’re off to the right start
Lots of annoying New Yorkers. Annoyed me at first, but I actually laugh at them now… Free comedy
Busy traffic and not easy to get to the beaches in the Wintertime… Just remember to not sweat the 20-30 minute drive, take your time, put the sunroof down and think about it being -10 and snowing in Quebec.
Crime — Be smart and learn the area. The one odd thing is that PBC is very spread out and sometimes the good/bad areas aren’t obvious until you get to know the area. Good areas and a good options exist. Do your homework on school districting if that’s an issue. I think this is common sense for any new area.
Immigration — A lot of the immigration problems are unfortunately becoming a national issue and not just a Florida/SoCal issue anymore. Good friends outside Portland, Oregon (former home) are suddenly concerned about their suburaban school district which has had a sudden influx of Somalians and other non-English speakers bringing down the school rating all in the name of tolerance and diversity of course…
The town of WPB has some scary parts especially the North side towards Riviera Beach and anything close to the I-95 corridor on the side roads from North of WPB through Delray is a no-go ghetto zone, but the areas in Western PBC are all pretty new and safe.
Enjoy your first Winter in Florida and as you will be renting you can take the time to see whether you like it enough to consider buying in a year or two (with another 20-25% pricing haircut at minimum in the bag)
Thanks Warrior and Palmetto.
Support is very much appreciated at this point.
To be perfectly honest I am scared as hell.
I have never been to WPB but after all of the research I did over the last five years this was the place I thought would be perfect for us.
My husband can work the Sea Port to add that to his resume and I could have a nice place so I could buy a couple of horses to resume my hobby of riding and showing.
I will check out that link thank you so much.
Wish me luck, as I travel tomorrow alone by plane with my little dog and cat.
My husband is doing the drive with my son and two other dogs and a bird. My nerves couldn’t take a road trip like that.
My brother in law is picking me up in Miami. I am anxious to see all of the for sale signs and everything else that I have read about from this wonderful blog over the last year.
Thank you Ben for providing this avenue. I promise you one thing, when I get my dreams come true, there is going to be a nice donation coming your way. You have my word on it.
SKB
SKB, I actually think you are arriving in Florida at almost the right time, if you want to eventually buy. You will have a little time to look around, see where you really want to be and then buy for cash. Actually, if I were you, I wouldn’t hesitate to put up a little ad in Craigslist saying you are looking for a home in Wellington or RPB for cash and see what comes. You never know. Have some fun with it. You’ve got the leverage.
I have noticed several ads on Craigslist from buyers looking for realistic sellers.
I saw one saying he was willing to pay 1998 prices!!!
I e mailed him asked him if he has had any luck, no response yet.
I want to pay pre bubble with a 3% YOY built in to be fair.
Before you buy get a quote for your taxes(2 % of the SALE PRICE of the home $250K-$5K taxes NOT appraised)and insurance…(be prepared for sticker shock and remember with Florida insurance is a variable it can go up anywhere from 20%-50% without a hurricane. So factor that into your buying $$) There is no Allstate or State Farm to get insurance from you will be buying through the state..deductible will be high.. range can be 10K-60K depending on location and age of property.
That’s total BS! Unless you are planning on living a few miles from the coast, insurance won’t be a problem. I just got a qoute from state farm and Allstate for a house we may purchase. They are calling constantly for my business! The qoute for comparable coverage was only $600 more than my home in NC three years ago. As far as the taxes, depending on the community it 1.5% or less of the sales price. For us, considering we paid state income tax, we find it to be quite big savings over living in NC. For us taxes and insurance will be around $14,000. We paid $25,000 in state income tax when we lived in NC!
I’m so tired of hearing everyone bitch about the taxes and insurance! The only reason they have even been an issue, is due to the ridiculously false inflation in home values! Now that prices are coming down, taxes won’t be an issue. Insurers won’t have to replace homes for five times their worth……Insurance is an issue if you live near the coast. Yes, it’s going to be more than other states, but it’s not that outrageous!
Hey Lizziebeth, I had wondered what the heck happened to you. Welcome back!!!!
Well, I am in Florida now, I arrived yesterday. I am staying in Miami until tomorrow then I head to WPB.
I rented a house for two months in Wellington while I look for a permanent rental.
I like Royal Palm Beach, The acreage and Jupiter.
Keep in touch, e mail me at sunkissedbeach@yahoo.com
SKB
Please keep in touch hon.
I wonder how many of the newly broke and unemployed will join the military? I’ve read book after book about the Great Depression and that’s one thing that’s different now. There are jobs available. I know because the Marines are constantly calling our house and sending us e-mails offering to pay for my son’s college education. I don’t know if they do this for all high school seniors or if they singled him out because he’s an IB student.
My father put himself through community college so he could enter the Air Force as an officer and they trained him to become a pilot. Why can’t more people do something similar? I look at the Flippers on TV and guys like Crisp - they seem young and strong enough to do what my father did. The construction workers, too.
Who wants to be cannon fodder for the oil companies, private equity, bankers, et al?
“Who wants to be cannon fodder for the oil companies, private equity, bankers, et al?”
Not only that but how many people can our governments employ? Our federal government is a behemoth.
yeah the whole being killed and maimed while trying to secure oil fields just doesn’t sound that appealing
Ben, as I said above, the message we’re sending is “You fight, we’ll have a housing bubble”. This is an alternation of a headline I read that said “You fight, we’ll shop”.
Not to highjack the thread, but I think mandatory military service for all would put an end to our expansianist ways. If CEO’s and Senators all had to worry about their sons and daughters being sent to dangerous countries because of their own political and economic decisions, they might be a bit hesitant to “pull the trigger” on military adventures.
Also, there is something to be said for a society where the poor and the wealthy share many of the same risks.
Disclosure… I am ex-army (infantry) and wouldn’t change a thing regarding my service. I have two children and would never discourage them from service, though I may try and “convince” them not to take the same military occupation as their father. There are safer ways to learn life lessons than being shot at.
There are those that believe such choices may not remain voluntary for that much longer. We’ll see, intersting times indeed.
So I’ve heard, edgewater. It’ll be different this time, since they’ll probably draft women as well.
While I’d like to think I don’t crease my tinfoil quite that sharply, If things got to that point it would be capital FUGLY. Still, it never hurts to be aware of all possibilities no matter how outlandish - at least that’s what my causal reading of military history has taught me.
I think there will be revolt in the country if they reinstate the draft. During ‘Nam, the elder generation supported the draft and the war. This time around, the elder generation includes all the ‘Nam veterans and I really doubt that any substantial number of us would support a draft in order to fight “intervention” wars in the Middle East. Been there, done that, don’t want it to happen to my children.
There’s a line in the Washington Post article that, as always, alludes to the fact that in DC is may be different because so many jobs are tied to the goverment. What the article fails to address is that many DC area residents invested in Florida real estate over the last several years. It was the talk of the town a few years ago. Real estate investments, especially condos in Miami, were seen as a smart way to play the Baby Boomers are retiring theme or as a way to buy a vacation propert in an ever rising market.
Of course there were many investors all up the East Coast, from D.C. to Boston, who bought properties all over Florida. There are going to be losses realized outside of Florida as well, as money is lost or cash in drained into the ever ongoing costs of keeping these properties going. I wonder how the large these secondary affects on locations outside of Florida will be?
Secondary effects…think of all those Brit investors with Florida properties…some of them gotta be standing in line at Northern Rock. Oh yeah, lots of secondary effects.
I meant to say I would be arriving in Tampa on Tuesday, but will be there for a week visiting friends in Brandon. If anyone would like to have a get-together anytime this week I think that would be great. My e-mail is bmaisano@aol.com. Location doesn’t matter if anyone has a suggestion on where we could meet. I plan on driving around a lot anyway.
Barbara — to better protect yourself from spam, recommend that in the future you write your e/m address as bmaisano at aol dot com.
Thanks, Chip, I didn’t know that. I’m looking forward to coming to Tampa as I haven’t been there in about a year. I hope we can have a get-together sometime this week. I think we’d have a lot to talk about.
Diogenes, Chip, Ultimate Warrior and Palmetto (don’t know anyone else who lives in the Tampa area) O.K., I have a suggestion. What about Macaroni Grill at the corner of Highway 60 and I-75? Wednesday at 7:30 P.M.? Can anyone make it?
When are the West Palm Beach HBBers going to have another get-together? It looks like we have another family joining our ranks (SKB) so we should celebrate! After all, they’re not creating any more housing bubbles!
I would love to have a get together, I need to connect with some people.
Let me know what you can come up with.
sunkissedbeach@yahoo.com
While it would be great fun, I’m in Orlando. Hope the rest of you can get together.
WPB… YUCK. Moved from that rathole 3 years ago. Look farther north.. PLEASE!
Ok, suggest something to me that is close to the WPB sea port and allows horses.