Getting More Affordable All The Time In California
The Press Democrat reports from California. “Sonoma County’s housing slide hit the two-year mark in August as prices fell yet again, and the market may not hit bottom for another year, industry analysts say. The county’s typical home sold for $549,990 in August, the 14th consecutive month the price was down from a year earlier. Prices have dropped 11.1 percent from the record high of $619,000 in August 2005.”
“And 2007 is shaping up worse than 2006. ‘It was a tough summer. We’re having probably a greater adjustment in the market than I’ve seen in the past,’ said Brian Connell, broker in Santa Rosa.”
“‘My guess is we haven’t seen the end of it,’ said said Steve Cochrane, regional economist for Moody’s Economy.com. ‘Once we hit a floor on prices, I don’t see any significant turnaround.’”
“‘The pool of buyers shrunk by about 30 percent because of the tighter requirements,’ said John Klein, executive VP for a Santa Rosa mortgage broker. ‘It really hit in August.’”
“The market for homes priced under $500,000 is feeling the greatest impact. ‘That’s where most of the price decline has been because that’s where the inventory is growing and where the credit crunch is felt the most. Because people who would like to purchase those homes a lot of times don’t have the financial strength,’ Laws said.”
“Lenders and real estate brokers acknowledge the market’s downturn represents a necessary correction from housing’s recent boom. ‘In retrospect, we shouldn’t be too surprised by it,’ Connell said. ‘Home ownership was way up, but it was probably true that there were some folks buying property who probably shouldn’t have.’”
The Recordnet. “As the housing market sinks deeper into the biggest slowdown that local real-estate brokers can remember, the few agents who specialize in foreclosures are hopping busy.”
“Kevin Moran, an agent (in) Stockton, was involved in some foreclosure deals in the mid-’90s real-estate downturn brought on by a statewide recession, but he’s in it exclusively this round because he sees much bigger opportunities.”
“‘It’s the tip of the iceberg,’ he said of the growing mass of foreclosures in San Joaquin County.”
The Tribune. “The median price of a home in San Luis Obispo County dropped in August, marking the sixth consecutive month that indicator has dropped, according to Dataquick. And for further emphasis of the problems facing the local housing market, the total number of houses sold in the county was 302, the smallest number for the month of August since 1992.”
“Andrew LePage, an analyst with DataQuick, said that San Luis Obispo County’s market mirrored what is occurring statewide. ‘The current slowdown in SLO and beyond has more to do with the aforementioned pre-met demand, the lost speculative fervor, fast-rising foreclosures in the interior of the state, and higher-cost financing,’ LePage said.”
“Foreclosure activity in San Luis Obispo County continues to rise to levels not seen in more than a dozen years, according to the most recent data from All American Foreclosure Service.”
“Through the end of August, lenders had sent homeowners 758 notices of default —the first step in the foreclosure process. That’s more than twice the same period last year (340) and nearly 40 percent more than in all of 2006 (554).”
“Meanwhile, 192 trustee’s deeds—the final step in the foreclosure process when the owner loses the home — were recorded from January through August, compared to 31 in the same period last year. In 2006, 64 trustee’s deeds were recorded.”
The Signal. “As most of Southern California faces steep declines in home sales and prices, the buyers and sellers of Santa Clarita see a similar market as the current inventory of houses on the market almost triples the number of listed homes that are actually sold last month, according to Realtor Pam Ingram.”
“In the beginning of August, there was an average of 2,358 single family homes on the market with a median list price of $629,000, according to Ingram. Ingram said the homes actually closed with a median sale price of $517,000 because of the slow market.”
“‘This shows that people are listing high, but having to drop the number to get it into escrow,’ Ingram said.”
“Ingram pointed out that from the 2,358 homes on the market, 611 were new listings and from that, 286 went into escrow and 277 actually closed. With such a high inventory, Ingram added, ‘If we didn’t add any new homes to the market, then it would take a total of nine months to sell the inventory we have.’”
“As for home prices, Ingram said that they have not dropped as much as other Southern California neighborhoods, but a 10 to 15 percent decrease could happen in the next few months.”
“With the high inventory, Ingram said it is a buyer’s market as interest rates and the economy are good. ‘Buyers are nervous, but there are a lot of incentives available,’ she said. ‘One was even offering a car.’”
The Orange County Register. “The Fish,on the hunt for a larger home for an expanding family, perused new homes in the same Talega community in which they’ve lived for three years. The search seemed more attractive when they found out about Irvine-based Standard Pacific Corp.’s ‘Mission: Possible’ sale sweetened by offers of reduced mortgage rates and home prices, and other incentives.”
“The offers – part of the homebuilder’s 10-day effort to sell 200 properties in their luxury-home inventory in Southern California – enticed some prospective buyers in south county Saturday, though the number of browsers seemed less than ample.”
“‘Two years ago, the market got so hot that you were able to buy one without a down payment,’ said John Burns, a real estate consultant. ‘There are fewer people who can afford to buy than earlier. So the builders have had to adjust their prices.’”
“‘These sales are tremendous. I don’t know how a re-seller can compete, because homebuilders have dropped prices and homeowners haven’t,’ Burns said.”
“The median home price in Orange County for August was $642,250, up 1.9 percent from a year ago. However, DataQuick and local experts maintain that the figure has been skewed upward by weaker sales for starter homes and relatively stronger sales for pricier homes.”
“For example, sales drops were greatest for homes at the middle of the price range and just below it, falling 47 percent in the $600,000-to-$700,000 price category and 39 percent in the $500,000-to-$600,000 range. Sales declined for pricier homes, too, but not as drastically, dropping just 32 percent for homes priced at $700,000 and above.”
“John and Gina Forney, who purchased their home in a Talega neighborhood in July before the sale, said the location was a main draw, in addition to upgraded features in their near-$900,000 house.”
“The Forneys said the homebuilder also offered $45,000 in incentives, which included upgrades to the flooring and money toward closing costs. They plan to close the deal next month.”
“‘Now the market is really hard,’ said John Forney. ‘We just wanted to get into something.’”
The Press Enterprise. “A spokeswoman for J.D. Power and Associates said while times are tough for builders amid slowing sales, those who buy are getting pricing and other incentives, better warranty coverage and on-time construction completion rates, as well as improved customer service.”
“‘The things builders are suffering from are now actually benefiting consumers,’ said Paula Sonkin, the firm’s VP of real estate and construction research.”
“With new-homes sales down in the Inland region and nationwide, especially compared with the frenzied buying period of 2004 to early 2006, Sonkin said consumers are citing better relations with builders’ construction site managers. Many managers are inviting buyers to become involved in the building process for their homes, rather than telling them, ‘It’s not yours yet.’”
The Ventura County Star. “No surprise that last week’s ‘Boomer or Bust’ conference on housing packed the house (in) Oxnard. ‘Boomer or bust,’ indeed, with the top headline in Thursday’s Star: ‘Foreclosure sales up 784% in 2007.’”
“That is 548 foreclosure sales in Ventura County through the second quarter of this year, compared with 62 the first half of last year. People laughed when the conference topic turned to housing affordability and an audience member quipped, ‘Getting more affordable all the time.’”
One size fits all, homeowner
“‘Now the market is really hard,’ said John Forney. ‘We just wanted to get into something.’”
‘We just wanted to get into something.’”
A terrible mistake for instance ?
Just saw a NAR commercial:
“Get out and buy a house because interest rates are low, never abetter time to buy”.
When will the bullsh@t end?
In Florida last fall we had an NAR commercial that had an hourglass with a ‘time is running out for a deal’ theme. I guess someone keeps filling the hourglass. I think you will be able to get a bargain for the next ten years.
I switch to other Chanel whenever I see that damn commercial..
I switch it when that “This jacket means something” commercial
TiVo is great for this… no commercials at all.
Just wait until this hits the US Media regarding the tactics of the US NAR… heads will roll in the NAR…
The secret’s out on phantom bids
secret’s out on phantom bids’(The phantom bid) is one of the oldest tricks in the book’
MIKE DONIA, veteran Toronto realtor Registry, open bidding needed to stamp out phony offer scams, some realtors say
The incoming head of the Toronto Real Estate Board has come out swinging against phantom bidding tactics after denying they even existed when she ran for the job three months ago.
“It’s dirty realty, it really is,” Maureen O’Neill said of agents who fabricate offers during bidding wars. She is now calling on the Real Estate Council of Ontario (RECO) to yank the licences of agents convicted of using phony bids.
“Boot them out, we don’t need them in the business,” O’Neill said. “I don’t think these people should be allowed to sell real estate.”
Phantom bids can be used by selling agents to spark extra rounds of bidding or to spook potential buyers into rushing or raising offers. The practice is considered a breach of ethics under the Real Estate and Business Brokers’ Act of Ontario – administered by the Ontario council – and realtors who are caught can face hefty fines.
http://www.thestar.com/News/GTA/article/256968
Screw fines. Jail time.
Funny. When they tell me there are other bids on a house, it just causes me to walk away even faster.
He figured it was his last chance to jump on the bandwagon before it went off the cliff. Real smart fella
I saw a mortgage brokers sign today…
“Lending peace of mind”
I found it ironic, because morgage debt never brings peace of mind…
“‘Now the market is really hard,’ said John Forney. ‘We just wanted to get into something.’”
He just put his head in a noose, and he’s grateful about it. People’s stupidity never ceases to amaze me.
I can empathize with his sentiment. When you see prices rocket up and up and up, the emotional side of you thinks, “If I don’t get a home soon, I’ll never be able to afford one.” It can be hard to resist this temptation, even when your rational side says, “Wait a minute, these price increases don’t make sense,” especially if you’re witnessing your family, friends, and neighbors who are in a similar situation buying their first homes (albeit with toxic mortgages at prices they really couldn’t afford).
Thankfully, my rational side is much louder than my emotional side, and I am one who really let what other people think or do influence my behavior, but I can really see how people could have made this mistake. Granted, I’m not proposing that we all rush to bail them out or anything, but a little sympathy is not too much to ask for.
Now… if this was a guy who bought 4 homes with the intent of flipping them and becoming the next Donald Trump, well, then, no sympathy whatsoever!
I am the same way Scott,, sometimes the emotional bring out the worst of me.. the only thing, and I repeat, the only thing that kept me sane and not jump on the bandwagon in the beginning of 2005 was this blog..
I am grateful to have found you guys
“‘Now the market is really hard,’ said John Forney. ‘We just wanted to get into something.’”
There’s so many double-entendres in that sentence I wouldn’t really know where to start.
As Finbar Saunders puts it so succinctly - “Fnar, fnar”..
‘Boomer or Bust’
That’s Golden!
Lately, Realtytrac.com shows more and more new highs of pre-foreclosures for Santa Clara county. The latest high is 2,700 pre-foreclosures at present. This number is not a yrly total - it reflects only the unresolved foreclosures at any one time. I’m wondering if there are websites that record a county’s total foreclosures for the year so far?
“Lenders and real estate brokers acknowledge the market’s downturn represents a necessary correction from housing’s recent boom. ‘In retrospect, we shouldn’t be too surprised by it,’ Connell said. ‘Home ownership was way up, but it was probably true that there were some folks buying property who probably shouldn’t have.’”
“Lenders & real estate brokers acknowledge” Oh really? Are these the same “lenders and brokers” that helped this smuck?
“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.”
Yeah, lots of suckers got done by the you can just refinance or sell later… Pure speculation on all sides.
This year’s vintage promises to be a very good whine…
“Sonoma County’s housing slide hit the two-year mark in August as prices fell yet again, and the market may not hit bottom for another year, industry analysts say. The county’s typical home sold for $549,990 in August, the 14th consecutive month the price was down from a year earlier. Prices have dropped 11.1 percent from the record high of $619,000 in August 2005.”
Nice word play.
Sonoma is wine country.
Now, Sonoma is whine country.
“the market may not hit bottom for another year, industry analysts say”
Where do they get that? How am I supposed to believe these “analysts”? Aren’t those the people who told me two years ago that RE would keep going up forever, and then said last year that RE never goes down? Then told me we had already reached a bottom a few months ago? Now it’s “next year will bottom out”.
“The Press Enterprise. “A spokeswoman for J.D. Power and Associates said while times are tough for builders amid slowing sales, those who buy are getting pricing and other incentives, better warranty coverage and on-time construction completion rates, as well as improved customer service.”
“‘The things builders are suffering from are now actually benefiting consumers,’ said Paula Sonkin, the firm’s VP of real estate and construction research.”
If I was cynical I might be tempted to equate that to having premier seating and discounted fare on the Titantic.
Off topic - I’m watching the Giants play the Packers and what should come on? You guessed it, a commercial for REALTORS. Let’s review.
- “We had to buy now or we would have missed out on this house.” - Suckers!
- “Interest rates are at historic lows.” - Then why do we need the Fed to cut.
- “There are more choices than there have been in years.” - Inventory glut.
- “There’s never been a better time to buy.” - Boy, do we need that commission before we starve.
This is the industry that is on the brink of bringing down the world’s economy. This is worse than the Giants’ Defense.
NYCBoy,
You’re from Wisc right? Should’ve seen the state turn out in LV last weekend. Simply beautiful.
Lip
I am officially challenging you to a dual, Lip. I’m from Minnesota.
Make that a “duel”.
Actually I’m from Chicago, but you guys are looking good. Adrian Peterson was an awesome choice and it’s going to make things a lot more difficult for many years. The Bears are going to be about the same as last year I suppose.
What’s the challenge? A cap for the best record or for the series? Note that a six or twelve pack just doesn’t ship too well.
I have been more of a 49ers fan over the years. That should be part of the California topic. The 49ers are 2 - 0. That should boost those Bay Area sales.
If the Vikings or Bears go 2 - 0 against each other we will do 12 packs. Leinie Red would be a good payoff.
OK
I’ll add a Big Boomer Sooner to AD (All Day ) Peterson!
Forget interest rates at historical lows. I can’t wait for Nows a great time to buy, interest rates and “prices” are at historical lows. Only available to those with excellent credit and at least 10% down and full income documentation.
I just put my house under contract to sell today. I listened as the realtor told the buyer that “No one ever loses money in my neighborhood”. I kept my mouth shut that I was selling for 10K less than I bought last year after putting 6K+ of improvments into the house to finish the basement.
Maybe I sold for too little (I was only on the market since Wednesday) and several of my neighbors were considering buying my house, but I was happy to find a buyer who had no contingency and wanted to close in 2 weeks.
The buyer is still doing 100% financing with two loans dispite moving from CA after living and owning there for the past 5 years. They have apparently already sold their house in CA.
good move. a bird in the hand. you best offer is your first one and they seem unencumbered.
2 loans and 100% financing after selling in Cali. Huh I wonder whats up no down payment.
The plot just thickened… I was telling my neighbor about the contract (that the realtor decided to bring by tomorrow morning instead of tonight) and my neighbor is going to submit a contract to buy my house as an “investment” property (even after having explained why I am selling). The good news is that she will rent it back to me and she is putting 20% down! Let the bidding war comense…
WOW, I don’t believe what I am hearing.
Greenspan book: GOP ’swapped principle for power’
http://www.cnn.com/2007/POLITICS/09/16/greenspan.book/index.html
Former Federal Reserve Chairman Alan Greenspan slams President Bush and today’s Republicans, while calling Richard Nixon and Bill Clinton “the smartest presidents” he worked with, according to an advance copy of his upcoming book.
In the book, Greenspan wrote that Bush essentially left an unbridled GOP Congress to spend money however it saw fit, and by not vetoing a single bill in six years, the president deprived the nation of checks and balances.
“The Republicans in Congress lost their way,” Greenspan wrote. “They swapped principle for power. They ended up with neither. They deserved to lose.”
He further says the GOP deserved the stomping it took in November’s congressional elections — a ballot that saw both houses of Congress wrested from Republican control — because the party “swapped principle for power.”
Greenspan, an 81-year-old Republican who retired last year after five terms as Fed chairman, wrote that he made no secret of his view that Bush should reject some bills.
Strange that Mr. Greenspan has turned back into a libertarian-lite after being a faithful non-complaining Repub. Next he will promote the gold standard!
Classic symptoms of denial. “I’m not crazy, everyone around me is.”
this coming from a former Fed Chairman, who didn’t see the problem with ARMs, liar loans, Subprime, etc. until 2006..
gimme a #$@^ break..and BTW Al, get out of the Ivory Tower once in a while…
Although he is correct, where was the old turd while this was going on? Maybe he should have said and done something back then instead of writing I told you so after the fact. He was part of the problem with the loose regulation and calling for more ARMs when the FFR wat 1%
He’s got a sharp publisher who knows how to generate interest in the mundane.. has good timing as well.
I seem to have misplaced $30 billion…
http://news.bbc.co.uk/2/hi/business/6997621.stm
Don’t worry. It’s probably contained in your sofa.
please be careful how you use the word “contained” in a housing blog. You’ll cause buyers to pause, and realtors will blame this blog for the slow down.
Although OC prices remain sticky, days on market are way up. One house on our street just replaced the “for sale” sign with a “for rent” sign. Another dropped the price $100k for a short sale.
It feels so good to be right.
Those “For Rent” signs should scare people with homes for sale in the same neighborhood. Perception is everything at this point. Nothing would scare away potential buyers more than seeing “For Rent” signs down the street from a house they are interested in.
SoCal bubble bloggers,
I’m trying to organize a party/dinner in the South Bay part of LA.
Where: Redondo Beach Cheesecake Factory.
When Sunday 9/30/2007 at 6pm.
RSVP on my blog or e-mail wannabuy3@gmail.com
Hope to see you there! We have a good expected attendance.
Got popcorn and some time?
Neil
I love popcorn cheesecake — alas, I’m in a bit too far up the road from SoCal.
Saint Barbara
Santa Barbara Housing Bubble Blog
If I can attempt to make it, you can. I live in CT.
I am thinking a nice sinking popcorn souffle would be quite tasty about now
If I can get the wife to bite I’m there. It’s a bit of a hike from Newport, but I grew up in the South Bay and can use it as an excuse to visit the family as well….
Neil,
My better half and myself would want to attend the dinner as well.
I sent you an email as well.
Jai
Sorry I am busy relocating to an affordable apartment to weather out this storm.
Might I suggest the next party be at the Fuller Lofts in “downtown LA”. They have a table with punch and cookies set out on the sidewalk for their fabulous sales events.
I say we get a group photo with the sales staff, holding bags of popcorn.
Been driving around Costa Mesa and Irvine. All I can say is Holy Shiite.
There are soooo many commercial properties “Available” and “For Lease”. Going around Red Hill, MacArthur, Jamboree, it’s unbelievable how many signs are up. Block after block. Costa Mesa is the same, to a lesser degree. You have to wonder who the heck vacated all these properties, and who the heck is going to fill them? I’ve been noticing this for several months now, but it seems to be getting substantially worse.
There are soooo many homes for sale. Richmond is having some “Gold Star Event” at some development of theirs in Costa Misery. Costa Pacifica has their sign spinners in overdrdive. Open house signs all over the friggin place. Surely there can’t be that many realtors available to attend all the open houses! More bank-owned properties showing up in my neck of the woods, and more properties that look like they’ll be bank-owned soon.
I think this part of OC is totally hosed. Seriously.
I second that assessment. My observation of the area surrounding John Wayne airport has been of utter commercial leasing devastation since the beginning of the year. I’ve also seen those sign flippers advertising those awful homes that are basically built within a reacharound length of each other. One time my gf and I got lost visiting a friend’s rented place by Irvine Blvd/17th and actually ended up looking into the windows of a vacated home. Later I found out it already had a NOD. I do like this area of OC with all of its businesses (chain & local) grouped closely together, but obviously the housing prices need to drop. I’ll be waiting…
I’m seeing this in the south bay too. I’ll read article predicting a 17% increase in commercial rents while driving by dozens of empty storefronts and partially full office buildings. I’ve even found a few secondary buildings completely empty.
What the heck is going to happen when all the realtors let their leases expire (or declare BK and walk away from their offices)? We created a huge number of sales jobs in the last five years.
54% of the jobs are in the top two quintiles (top 2/5th)
mid quintile grew a small amount
The lower middle class shrunk.
43% of jobs created were in the bottom quintile.
http://www.signonsandiego.com/news/business/calbreath/20070902-9999-1b2dean.html
Now how many of those top two quintile jobs were REIC? No middle class translates into a very unstable economy…
Oh, I found the article noting that only 9% of San Deigo earn above $75k. While I’m sure multi income households push that up a bit… We have a “lot of downside potential.”
Got popcorn?
Neil
No middle class translates into a very unstable economy…
no middle class = revolution (look in history it is the main cause of a revolution)
It appears that The Big Down is upon us.
It’s just like that in San Jose. It seems tht 24-30% of commercial space is for lease, yet there are several huge commercial “towers” nearing the completion of the construction process. Same can be said for condo situation. Funny.
Read the opinion page of the Mercury News, we’re creating “Vibrant” communities on unused commercial sites says developer. Yeah, if you think reaching out your condo window to slap passerbys is “Vibrant” I’m sure he is right. WTF.
I agree. Vibrant ‘this”.
Big V,
Did you have a HBB party yesterday? I would have liked join you guys; but I live in Chandler, AZ now.
Yeah, I had a party, but there were only 3 of us. That’s OK. We got a good little dose of fresh air, sunshine, and even exercise. And we talked a little trash about silly homedebtors and lenders and such.
I’m think of trying to organize a dinner maybe next month.
Being from Norcal all my life, I’m not too familiar with Socal cities. I’ve often thought of moving there. Which do you consider the best (if any) places to live in the LA basin and/or OC? Also, Is San Diego or its outlying cities worth considering?
It depends what kind of an area you’re looking for. Since it’s so large, every area has its own distinct character and culture. Do you want beach, city, space, culture, family oriented suburbia? How much do you want to spend? Where would you work and hance how far would you want to commute max. Any ethnicity priorities for the neighborhood? Sporting preferences? SoCal is basically its own large civilization so you need to narrow your question.
South Orange County is probably the nicest family friendly area in southern California IMO. Parts of San Diego are nice, but no place matches OC. LA if you move to the Agoura/Westlake area, Calabasas is also nice. San Diego, Mira Mesa, Tierrasanta, La Jolla (pricey), parts of North County San Diego are nice.
Mira Mesa? You must be joking - or Filipino.
We Rent,
Nope, not Filipino, I guess the parts of Mira Mesa I saw were mostly White/Asian Middle Class. It has been a few years, and I have never lived there, so perhaps my assumptions on MM were off.
South OC is the best of them all in my opinion.
Dear Bottom Fisherman:
I know this question wasn’t addressed to me, but I have to say that San Diego is really a beautiful place, although its population at present is much higher than what the city can really accomodate. I suggest vacationing there for two weeks (if you have that much time) so you can get a feel for it. Visit the San Diego Zoo, the San Diego Wild Animal Park, Seaport Village, Ocean Beach, Del Mar, the Rodeo in Santee, and Tijuana or Ensenada in Mexico (Ensenada is better, but further down). That should give you a good idea of what it’s like in the greater metro area.
Thanks for the ideas you guys. A friend of mine recently moved into a rental in Santa Monica and says it’s nice there. What do you think of SM? I like that it’s near to the beach.
In SD area, I wouldn’t mind renting in La Jolla for a while if I can find a desperate landlord willing to bargain on the rent.
JMHO:
The basic trade-off between LA and OC is culture (LA) vs. quality of life (OC).
LA is higher crime, more blight, and worse traffic. My personal choice is easily OC. Try driving around in Hollywood, Santa Monica, Inglewood, or even Pasadena in the afternoon/evenings. It’s pure Hell. Also, OC doesn’t have any place that compares with Compton, Watts, Wilmington, and East LA crime-wise. Santa Ana tries to make the list, but doesn’t quite make it.
OC is mildly better. The more south you go (and further from LA) the better it gets. Ironically, south OC is getting cheaper faster housing-wise. Mission Viejo, Irvine, San Clemente (if it doesn’t kill you commute-wise). IMO, don’t waste your time with Newport Beach - way too crowded. Avoid Costa Misery, Santa Ana, Anaslime and Garbage Grove.
Of course, the best is to find a home near your work, if you can swing it. That’s been my modus operandi for years and it has served me quite well.
Being from Norcal, if you mean Silicon Valley, you’ll probably find Irvine most comfortable and familiar.
It really depends on what you are looking for. I find Irvine to be too “orchestrated”, too “planned”. The trees are all cut the same on the streets, the houses are all bunched together and the commercial spaces shoved into limited spaces so when you need gas there are limited options and sometimes long lines. I kind of like the eclectic mix found in Constant Misery (Costa Mesa). Newport, CdM, and Laguna are too costly for housing for my budget. The Beach Cities, HB, CM, Newport, etc. are about 10 degrees cooler on the hottest days, have a sea breeze and more moderate temps throughout the year. Many of the older bungalows only have wall heaters and no AC because that is all that is needed. Sadly many of the older properties have been raped and turned into zero lot line McMansion/Frownhome zones. Old Towne Tustin is a nice community, but I do not know much more about the folks living there and it is hotter than the Beach Cities. South OC is clean and has a lot of services and I hear it has great schools.
Come on down and check it out for yourself. Pick a city and rent there while you do recon for a year of so.
I know this is late, but I wanted to add my 2 cents. I am also from Nor-Cal, have lived all over So-Cal (including on the beach) and now reside in Rancho Cucamonga. I know the IE gets a lot of flack (and deservedly so) but on the western edge (eastern edge of LA and OC county) are two great cities, Chino Hills and Rancho Cucamonga. I have lived in both. They boast newer suburban homes, great schools, exceptionally low crime (some of the safest cities in America), RC has a brand new mall complex (Victoria Gradens, upscale shopping, dining, entertainment, cultural center, etc). The sports programs produce some of the top talent in American pro sports (MLB, NBA, Softball, US Soccer teams- both male and female). The congestion is less than half of what you will see in LA and OC (which I absolutely hate) and I have my eye on large beautiful estate homes with views (3,200 sq ft, pool, 3 car garage) already priced in the low 700’s and going down. You can’t beat that. The negatives are high heat in the Summer, proximity to crappy towns like Fontucky (and their residual overpsill of customers to our mall) and it has a ways to go culturally (too many big trucks, not enough BMW’s). But that is changing. LA is too crowded and crime-ridden to raise a family, and the OC is also too crowded, close-minded and racist for my blood. If I win the lotto, everything changes. The beach it is, but we have to live in reality here.
For two bits (inflation) I’ll tell ya as someone who has built some part of every corner of So-Cal….sure everyone thinks their little corner is something special, but after 20 years of cookie cutter developement everything is the same.
You have to define your needs, in order to get what you like. If you have school age kids, look for a tiny school district with an above average tax base. If your income is based on driving, study the sigalert traffic map and pick the area with the least amount of red circles between customers. If you are retired, move to a town in the flyover states with a big medical university.
If you live paycheck to paycheck and can’t get overtime, live as close to work as possible.
Once you get these big issues resolved you’ll find to time to fall in love with something about your neck of the woods.
“The Press Enterprise. “A spokeswoman for J.D. Power and Associates said while times are tough for builders amid slowing sales, those who buy are getting pricing and other incentives, better warranty coverage and on-time construction completion rates, as well as improved customer service.”
“‘The things builders are suffering from are now actually benefiting consumers,’ said Paula Sonkin, the firm’s VP of real estate and construction research.” ”
If I was cynical I might relate that to having a great cabin and discounted fare on the Titantic.
Sorry about the double post. Thought the gremlins got the first one.
Mid Month Reminder!
OK guys, it’s that time of the month to send Ben some cash. We all know how much this blog means to us and there’s going to be a lot more people checking out the blog as this things keeps rolling. I’m sure Ben would appreciate anything because it all adds up when you multiply it by 1,000.
For those of you in the stone age, his snail mail address is:
HBB
PO Box 3312
Sedona, AZ 86340
Is he still accepting US currentcy?
Don’t know, what’s the best these days, Icelandic Króna ???
No Recession for Silicon Valley, we’re special !
http://www.mercurynews.com/business/ci_6910211?nclick_check=1#recent_comm
I don’t feel like trying to remember my password. What does the article say (other than that San Jose is immune to the housing crash)? Does it mention that the median price for my zip code (95126) is down 20% y-o-y? Or that all zip codes in San Jose have experienced price-per-square-foot declines y-o-y?
Hmph.
Economic prognosticators are uttering the second-ugliest word they know: recession. They’re warning that the ailing housing and debt markets could sicken the broader U.S. economy.
Well, we don’t have to worry much about that here. We’re likely to be immune to the recession virus.
As with so many things, Silicon Valley lives in a different world - a global one. And that diversification will protect us.
To understand what’s going on, just look at PixSense - a start-up that has devised a one-click method for people to send photos from a camera phone to friends or Web sites.
The 2-year-old Santa Clara company has yet to persuade any American cell-phone carriers to deploy its software.
But that’s OK, says Paul Singh, PixSense’s chief executive. He’s signed up four large carriers in Europe and Asia, where the industry is a bit more eager to experiment with new technologies. “Today, those are my only customers.”
Singh predicts that for his company, foreign markets will always be bigger than the United States. “The growth in certain countries in Asia is so high,” he says.
PixSense also depends on a global workforce. It has about 10 employees in the valley and it wants to hire 10 more. But it has 60 people in India, Pakistan and China developing software. Singh says the foreign workers keep down costs and allow the company to take more chances.
There are hundreds of start-ups like PixSense that, along with the bigger tech companies, contribute to the valley’s economy but depend on the rest of the world to make their business work.
I don’t mean to downplay the pain that some valley residents are about to feel. Families will lose their homes to foreclosure as their mortgage rates reset. A prolonged stock market slump could crimp retail spending by tech and financial workers, trickling through the rest of the economy. And rising oil prices continue to raise daily expenses for both consumers and businesses.
But as long as the rest of the world wants what the valley makes, our economic engine will run just fine.
“Most Silicon Valley tech companies are more participants in the global economy than they are in the U.S. economy,” notes John Shoven, chairman of San Jose’s Cadence Design Systems and director of the Stanford Institute of Economic Policy Research. “And the global economy is very, very strong.”
Worldwide demand for computers is so robust that Intel, the valley’s flagship chip company, just raised its revenue estimate for the third quarter, which ends Sept. 30.
Intel says sales should be as much as 12 percent higher than a year earlier. Those gains probably aren’t coming from the United States, which accounted for less than 16 percent of the company’s $35 billion in revenue last year. (The Santa Clara company’s biggest market was Taiwan, with the U.S. second and China a close third.)
Seagate, a disk drive maker with operational headquarters in Scotts Valley, is another company surfing the wave of foreign demand. For the fiscal year that ended in June, it sold $7 billion of drives in the tiny nations of Singapore and the Netherlands, double the sales in the United States. And the first quarter of this year is shaping up to be stronger than expected.
Even if you are part of the 70 percent of Silicon Valley that doesn’t work in tech, you’ll benefit from that vitality.
“We are providing service and support jobs to the people who are working in the basic industry, so we rise and fall with them,” says Stephen Levy, director of the Center for the Continuing Study of the California Economy in Palo Alto.
Ironically, the valley companies’ use of offshoring tends to have a stabilizing effect on the workforce here. Sure, Intel just broke ground on a new chip factory in Dalian, China, that will employ 1,200 workers - but the Santa Clara company still has 5,000 employees in Silicon Valley.
“For a company to have a thriving headquarters here, it has to be profitable. That’s the outsourcing trade-off,” Levy says.
Anyone who’s been here for a while knows that our reliance on global demand can be a liability. The 2000-01 tech bust clobbered us, while the rest of the country just got nicked.
But this time, we’re on the right side of the economic curve.
——————————————————————————–
This article is just silly. Doesn’t the author know that Asia’s recession will be caused by ours, and that Europe’s credit bubble has been just as bad (or worse) than ours? No, I guess not. That would require some sort of INVESTIGATION, and journalists don’t have to do that anymore. Poo on the Merc.
Oh, and BTW, how is it more stable to have outsorcing? If one of these treasonous companies decides it needs to cut staff, it will probably cut staff here and keep its impoverished employees working 12-hour days in China or wherever. What do I care if some crappie company that employs 10 Americans is able to stay in business? How does that help our economy? It doesn’t. Double poo on the bad Merc.
85% of net new jobs in the US, created between 1989 and 2003 were at companies with fewer than 20 employees.
That’s why you should care.
http://www.sba.gov/advo/research/dyn_b_d8903.pdf
Silly-Con Valley is as immune to recession as Wall Street is immune to recession. The pay might be higher than other areas, but that doesn’t mean there can be layoffs and outsourcing.
What diversification? Silicon Valley is still extremely dependent on one sector, tech. I guess two if you count real estate.
Now the market is really hard,’ said John Forney. ‘We just wanted to get into something.’”
I hope he paid his $900K in cash. Mighty big noose when it drops in half. What a fool.
I’d rather have 100% financing. Why risk $900K of your own money if there is a lender stupid enough to take all the risk?
Off topic - but hilarious. OJ arrested.
http://sports.yahoo.com/top/news?slug=ap-simpsonquestioned&prov=ap&type=lgns
It is about time they arrested the POS. He should be serving hard time with a jar of vaseline at his bedside.
No Doubt, but did we really need the 24 hour CNN coverage of this loser again ?
Tell me about it.
The only time CNN is bearable/interesting is for the early sunday morning shows.
Imagine my suprise when CNN cuts the last half of Anderson Cooper’s very interesting S.I.U report on the Afghan poppy cluster#uck to give me more “Breaking News” about OJ Simpson for, like, 5 hours.
I have no opinion on whether he ‘did it’ or not, but his behaviour, post-trial, has shown him to be an attention-seeking sociopath, who definately gets his ‘fix’ from the likes of CNN.
We can bring it back on topic, sort of. I say Greenspan is the O. J. of this decade: He’s on a mission to find the REAL killers of the U. S. economy, and if he happens to make a few bucks along the way, what’s the harm?
Greedspam saying Iraq about oil? No, say it isn’t so Mr. Magoo. After all, you were too busy ignoring toxic loans and encouraging folks to go and break their bodies and minds to get an ARM. I do not plan on buying Greedy Al’s book.
http://news.yahoo.com/s/nm/20070916/pl_nm/usa_iraq_gates_dc
I’m not gonna buy it, either, but I’m glad of what he said about the oil.
I absolutely will NOT buy or read his book. He engineered this bubble and now wants to profit from the pain as this has become obvious. Was the book written in response to the criticism he has received on this and other blogs?? Trying to spare his legacy?
POS reminds me of Liareah. Same suit, different glasses.
no Greensperm separated at birth:
http://www.imdb.com/gallery/granitz/5792/Events/5792/LarryKing_Grani_12666908_400.jpg.html?path=pgallery&path_key=King,%20Larry%20(I)
I signed up to get the CD from the library (3rd in line). I figure it will worth a good laugh!!
I’ve already ordered the book and expect it to be highly entertaining. It is a very great and hilarious irony watching what we thought was an ass-licking Republican now kicking that party while it’s down! Just to twist the knife, he also has high praise for Bill Clinton.
One of the more interesting Iraq=oil comments came from Ted Koppel in a 2004 or 2005 year-end interview where Tim Russert was the interviewer. Koppel said
(1) the left wants to say the war is about oil and therefore should be abandoned
(2) the administration wants to say the war isn’t about oil
(3) leadership would consist of admitting the war is about oil, and then explaining why it is essential to maintain the West’s access to Persian Gulf oil.
Many people in the US want to continue to reap the benefits of imperialism even while they decry the existence of imperialism.
You got that right! The classic is James Howard Kunstler’s neighbor who drives an SUV with a “War is not the Answer” bumper sticker. Sorry, but if you want to keep taking 12 car trips per day in a Suburban, Escalade, Denali, Yukon, or other mini tank, war IS the answer.
the war didn’t increase supplies to us, nor will it now.
the war IMO was mostly about preventing Russia and France from regaining their pre-1990 trading position with Saddam & Co, at the expense of solid players in the Republican power structure (Haliburton, KBR, etc).
Ha Ha. My neighbor’s 12 MPG $65K Land Cruiser has a similar sticker next to her Kerry/Edwards sticker (car is a 2006 btw meaning she put the bumper sticker on 2 years after the election).
I love the smell of hypocracy in the morning.
i know what life without oil would be like, so count me among those who want to continue to reap the benefits..
F that. Just like this credit bubble - bring the correction and get it over with! The sooner we get comfortable with renewable energy sources the sooner we can get our military out of conflicts that are created for the sole purpose of enriching the corporatocracy that is slowly bleeding the middle class dry.
“Sonoma County’s housing slide hit the two-year mark in August as prices fell yet again, and the market may not hit bottom for another year, industry analysts say. The county’s typical home sold for $549,990 in August, the 14th consecutive month the price was down from a year earlier. Prices have dropped 11.1 percent from the record high of $619,000 in August 2005.”
For how many more years can we look forward to a bottom one year out?
At least they went from IT HAS BOTTOMED to IT WILL BOTTOM
I think the chances are good that in another year they will be saying “may not bottom for another year or two.”
Well, I think the chances are good that in another year or two they will be saying ‘My bottom itches. Gimme another scratch with your cardboard ‘will work for food’ sign, willya, Chris?’
(I say that because three of the five independent mortgage brokers I know are named Chris. It’s an unlucky name, clearly.)
i predict a time will come when they cry “This market will never hit bottom!”
the market may not hit bottom for another year
Of course it will, but just like Larry Craig, it will be hitting a new bottom every month!
LOL NICE!!! I loved it when he was saying he was not gay. I think if just made it that much more obvious to the rest of the world.
I am not looking to be negative about homosexuals. I think it was very obvious from his speach paterns that there is a high probability that he is gay. Kinda sounded like the teacher on Southpark.
OT, but interesting:
http://www.cdars.com/
This deal lets you put $25,000,000 in with a bank, and then they deposit $100,000 at 250 different banks so you have FDIC protection at all of them. I saw my bank promoting this.
Says you have to sign some kind of ‘agreement.’ Probably to prevent you from removing the money, since the kind of person who would use this, is also the kind who might decide to beat feet.
Thanks, but I just lent my friend OJ 25 mil, said he had a great deal in sports items.
“The market for homes priced under $500,000 is feeling the greatest impact. ‘That’s where most of the price decline has been because that’s where the inventory is growing and where the credit crunch is felt the most. Because people who would like to purchase those homes a lot of times don’t have the financial strength,’ Laws said.”
I find this claim highly suspect. Unless most homes sold over $500,000 are cash-only deals, then how can a full percentage increase in the Jumbo lending rate since the beginning of 2007 not be killing the white elephant McMansion market?
For instance, in one of San Diego’s highest-end zip codes (Rancho Santa Fe 92067), I see a current median list price for used SFRs on the MLS of
$3,900,000 (in fact, there are five homes currently offered at that price!!!) while the August 2007 median used SFR sale price was $2,335,000 — a gap of $1,565,000 (40 percent) between current median listing price and recent median sale price. It looks to me as though the high end of the San Diego market is taking a major haircut.
P.S. Almost forgot to mention, but the August 2007 median used SFR sale price in 92067 is 22.2% lower than the August 2006 median used SFR sale price was, and the “All home sales” sale price was down by 25.8 percent YOY. “High end won’t be hurt” my arse.
http://www.dqnews.com/ZIPSDUT.shtm
The market for homes priced under $500,000 is feeling the greatest impact.
Yeah right, I love those statements. As if buyers in the $550K market are not going to notice that the difference between $450K and $500K is just not worth $50K.
Let’s all harrass these craigslist abusers:
http://sfbay.craigslist.org/sby/apa/423875591.html
WHY RENT WHEN YOU CAN BUY AND HAVE SMALLER PAYMENTS?
——————————————————————————–
Reply to: santacruzrealestate@gmail.com
Date: 2007-09-16, 8:45AM PDT
OK,
IF you are HERE in Craigslist looking to RENT an apartment, you should have the FOLLOWING FACTS to consider.
1. Rent payments in many areas are NOW HIGHER than a comparable MORTGAGE payment if you OWNED that Apartment.
2. This means, YOUR MONTHLY PAYMENTS on a CONDO with a SWIMMING POOL and a GYM could be LOWER than the RENT you are now PAYING for an APARTMENT.
3. RENT PAYMENTS DO YOU NO GOOD FINANCIALLY and only build the EQUITY of your landlord.
4. Mortgage PAYMENTS build YOUR EQUITY and the INTEREST portion is TAX DEDUCTIBLE on your tax returns (FED and STATE) which means that YOUR NET PAY-OUT after Tax Savings for the YEAR COULD BE LOWER in your monthly payments and therefore
YOUR CASH FLOW GREATER, even while living in a SUPERIOR SETTING.
5. Many Condo SELLER’S RIGHT NOW are PANICKED because they NEED TO MOVE and no one is even LOOKING at their HOMES right now. IT’s the WORST SELLERS MARKET IN DECADES.
THEREFORE PRICES are BEING REDUCED and YOU MAY EVEN NEGOTIATE EVEN MORE REDUCTIONS if you know how.
6. MOST IMPORTANTLY: MORTGAGE RATES ARE TUMBLING due to the Credit Crisis of their own making. AND, the FINAL MORTGAGE RATE you get in YOUR LOAN determines the AMOUNT OF YOUR MONTHLY PAYMENT FOR 30 YEARS, so there is CURRENTLY
TO SUM IT ALL UP.
THERE IS CURRENTLY A POTENTIAL FOR you to have LOWER MONTHLY PAYMENTS TO LIVE in a BETTER HOME in a BETTER NEIGHBORHOOD, and BE BUILDING YOUR EQUITY and PAYING LESS than if you were paying RENT in some DUMP.
TO TOP IT ALL OFF with a CHERRY on TOP. I’m aware of a BANK that is GIVING a $25,000 GRANT TO 1st Time Condo Buyers because BUSINESS IS THAT BAD.
THIS ALL MEANS you could walk into a CONDO TODAY with no money out of pocket, ZERO and be paying LESS than a RENTAL UNIT and HAVE EQUITY BUILDING GOING ON instead of DUMPING your HARD EARNED CASH every month right down the drain!!!!
THESE PERIODS OF MARKET INEQUITY NEVER LAST LONG.
YOU NEED TO ACT NOW.
For complete Details on HOW you can buy a CONDO for less than your RENT.
PLEASE REPLY TO THIS AD
Contact:
Mike Mathiesen
Quid Quo Realty
831-420-0107
Being a Realtor, I NEVER CHARGE you a DIME for these services. I make my living by putting my clients in a HOME. In the case of a BUYER, you never pay me a single DIME. I am always paid out of the SELLER’S CASH from closing.
THIS IS OPPORTUNITY KNOCKING. If you don’t take advantage you may live to regret it. Prices will go back up eventually and interest rates will go back up and these price reductions we are seeing will be history.
IF YOU REMEMBER NOTHING ELSE IN THIS AD, JUST REMEMBER - GET IN NOW.
too bad there wasn’t an e-mail address for this dirtbag. All of his points have been easily refuted on Patrick.net.
Here’s the e-dress:
santacruzrealestate@gmail.com
Luckily this CL post was flagged for removal. I’ve been mercilessly flagging CL posts all week. Wrong places, wrong category (plenty of sales ads in the rental classifieds), wrong anything, I flag it.
“IF YOU REMEMBER NOTHING ELSE IN THIS AD, JUST REMEMBER …” please buy something so I can eat this month. LOL
Rent payments in many areas are NOW HIGHER than a comparable MORTGAGE payment if you OWNED that Apartment.
Name even ONE such area.
test
US housing slump to deepen: Greenspan
http://news.ninemsn.com.au/article.aspx?id=66363&rss=yes
Here is the original article…………….
Greenspan alert on US house prices.
US house prices are likely to fall significantly from their present levels, Alan Greenspan has told the Financial Times, admitting that there was a bubble in the US housing market.
But Mr Greenspan said that his successors at the Fed – who meet on Tuesday to set interest rates – would have to be careful not to ease rates too aggressively, because the risk of an “inflationary resurgence” was greater now than when he was Fed chief.
http://www.ft.com/cms/s/0/31207860-647f-11dc-90ea-0000779fd2ac.html
That freaking tool was the one who created this monster by leaving the FFR at 1% for so long and cheering on the creative loans. Somebody should punch him in the face a few times and knock out his teeth
Or force him to have sex with Andrea Mitchell. Ouch!
That’s a good idea. And then that somebody should bend down and gather up and glue those extra, sprinkled around, knocked-out teeth back onto his wobbly little old wrinked Greenspan chin, into the shape of a sparkling smiley smile. So he can look cheerful for his photo-ops; the one for the future history books our kids and grandkids will be studying, prefacing the chapter reading ‘Why I Am Wearing A Burlap Bag Right Now.’
they could be chattering dentures
Olympiagal, you’re a funny girl.
oh yeah, inflationary resurgence greater this time.
Last time Uncle Al blew a bubble, inflation was moderating. The Gobal Rate Cut is just gonna stoke all the fires of inflation, GLOBALLY. And as we all know the Chinese currency is “fake money”….dollar is gonna rally.
How can the dollar rally in the face if a rate cut under heavy inflationary pressure? Get ready for the big leagues people, the game is changing again. The game is gonna change every time you swap a currency against the printers wishes. Ya think it was easy to lose money before? Well Im tellin ya’ DONT BET AGAINST THE HOUSE. And if you are even remotely thinking the idea of borrowing money to bet against the house, you my friend are gonna be in serious trouble.
Margin levels are ALWAYS TOO HIGH in this environment, you are geting the call this week, better be ready to pay up.
In a perfect world for the Fed, a random event occurs outside the U.S. that the Fed can use as a reason to cut.
1.lone rock
Assuming the Fed pulls off a magical combination of rate cuts with global central banks’ cooperation.
2.Paulson overnight to london
Along with more tax cuts and fiscal stimulus to prevent a hard crash at this time.
3.bailout
The Fed is, and should be, afraid of where such a process might take the US economy with so much riding on housing prices, housing prices riding on employment, and employment riding on consumption.
4.The Myth of the Slow Crash
Is this a self fullfilling prophecy?
“But Mr Greenspan told the FT that froth “was a euphemism for a bubble”.
He said he still thought froth – a collection of bubbles – was a better description, because of the variation in house price appreciation in different local housing markets. But he said “all the froth bubbles add up to an aggregate bubble”.”
“all the froth bubble add up to an aggregate bubble”
You just have to love this spew. What difference does it make, what you call. If prices are higher than they should be, based on fundamentals or purchases are being made with toxic sludge financing, then there is a problem. I wish this guy would just go away.
I know. I clearly remember him saying that “there is no national housing bubble”, rather, there were “certainly some frothy areas”. Naturally, he wouldn’t say where those areas were, but it was here.
The America area was one of the frothier ones.
Mr Greenspan said the off-balance sheet investment vehicles that issued much of the asset-backed commercial paper represented a “savings and loans disaster waiting to happen” because of the mismatch between their assets and liabilities. Mr Greenspan thought the issuance of asset-backed commercial paper ”is probably not going to get back to where it was.”
Looks like he gets it.
The former Fed chairman said the current turmoil in financial markets was “an accident waiting to happen”.
LMAO! Lucky for him, he got out of the way.
So greenspan finally gets it right. yes house prices will fall and inflation is on the rise. So tell us somthing we don’t already know.
This should be a stellar week. It looks like all the housing bubble celestial bodies are coming into alignment.
Playing out in the background is a housing bubble related bank run. And, to kick it off, we get the chief housing bubble blower’s confession to the FT. On Tuesday, the Fed changes course as a result of housing bubble carnage on Wall Street. We also get earnings reports from the housing bubble securitizers, investment banks. And, if all of that was not enough, to cap off the week, Friday is quadruple witching day. It’s going to be a humdinger!
Good luck out there. You are going to need it!
mrktMaven FL ,
Gotta say I enjoy your posts. Thanks
Hey Market Maven:
If you’re still on, can you tell me what the “quadruple witching day” is? Sounds kinda fun.
Here ya go…………….
http://12.162.177.49/lbp/definition.asp?item=883
Everyone knows that house prices can’t fall in the US because it has never happened since the Great Depression.
It was a crisp and cool day here on Boston’s North Shore. I took a drive and noticed that as the leaves are beginning to change color, so to are For Sale signs turning to For Rent signs. The area has never been very big on single family home rentals, but that appears to be changing.
Don’t forget Greenspan on 60 Minutes……should be a hoot!
It was a hoot when the guy came up to him at the football game, asked for his autograph and said “If it wasn’t for you, I wouldn’t have a house”. Geez.
The Nationals play football?
Hey guys…………..here’s the new deal.
With the dollar and US interest rates falling the new deal could be…………the US dollar carry trade
“The market for homes priced under $500,000 is feeling the greatest impact. ‘That’s where most of the price decline has been because that’s where the inventory is growing and where the credit crunch is felt the most. Because people who would like to purchase those homes a lot of times don’t have the financial strength,’ Laws said.”
Tough shit if “they would like to purchase those homes.” If they don’t “have the financial strength,” they shouldn’t be buying them. Enough with the whining.
Greenspan basically says, “don’t cut”.
Leslie Stahl said people are begging for a rate cut, including car companies. “What would you tell them?”
Answer: “Build better cars.”
This is beautiful.
I can’t disagree with him on that comment.
“Greenspan basically says, “don’t cut”.
WOW, and this from Mr froth and bubbles.
Really makes me ………
Leslie Stahl mentioned the “Housing Bubble” as if they knew about it all the time. She also dwelt on the fraud issue. That will definitely hurt the bailout crowd.
Overall, that interview was a victory for bubble-ites and a loss for denial.
Here’s an important point we discovered near the very end of the interview:
He enjoys sifting through govenrment statistics from across the country, to relax.
Here’s the problem with that important point:
The length, depth, and breadth of the Fraud still holding up the Housing Bubble hasn’t made it into government statistics yet.
In other words, he’s basing his outlook on not only old data, but flawed data.
When, in three years or so, maybe four, the actual amount of Fraud created in this bubble makes it into Mr. Greenspan’s outlook…
He’ll be absolutely HORRIFIED.
This is the problem with becoming an isolated, famous economist.
You have to get out there and talk to the ‘common’ folk to find out what’s bubbling beneath the surface.
He is a victim of his own unprecedented success.
Kinda like the lead singer in the Pink Floyd movie ‘The Wall’.
I really like Mr. Greenspan.
Maybe he’ll read these words, and understand how he missed it.
nice to see you back. lainvestorgirl is looking for you.
What a jagoff. He cuts to the bone and gets heaps of praise. Now he’s telling Bernanke to take the bullet for the recession that should have been on Greedspan’s watch.
I say let the speculators burn, but do not allow the financial system to lock up. Too many innocent people will be hurt.
FLASH: Title of Greenspan’s next book — If I did it.
Now that is funny!
BAAAAAAH! woooo … (snort)
If the loan don’t fit, you must acquit
If the equity is less, you must confess
If the Fed cuts rates on Tuesday, they will loose the little bit of credibility that they still have. After the 60 minutes interview, they have almost none with me. It’s all a big political joke.
Delusion is still rampant in L.A.:
Loan Rules Tighten in a Jittery Market”
Selected bits:
After recent meetings with loan officers at Countrywide Financial and First Federal, Tieri-Lepore is weighing their current options and leaning toward a five-year, interest-only, adjustable-rate mortgage. “It’s definitely more expensive to borrow now,” said Tieri-Lepore, though she believes buying is the right move based on her confidence that Santa Monica property will continue to appreciate.
—–
Locally, Gary Bluman, owner and president of Real Estate Resources, based in Brentwood, takes a more sanguine view. “We’re telling our clients that based on history, values will come back and that now is a good time to buy for the long term,” he said. “We’re not expecting a big slump.”
—–
But a less borrower-friendly environment has failed to dim the long-term optimism of James Minor and his partner, Gino DePercifield, who are looking to move out of their Placentia condo and into a larger, single-family home closer to central or south Orange County. Though they have enough cash for a down payment, Minor said they prefer to use spare funds to upgrade what they buy; so instead they are holding out for a 100% mortgage on a home in the $550,000-to-$650,000 range.
Not to be mean, but I really hope these people get what they’re looking for.
Was in Santa Monica today, and the stench of urine and and the sight of ever-present homeless just screamed ‘beach lifesytle.’ Why anyone would pay millions to live blocks away from this, I cannot fathom. As I walked about today, the word that came to me was ‘toxic’
Todays Word: MORTGAGE (from French) = “Death Grip”
Literally.
“With the high inventory, Ingram said it is a buyer’s market as interest rates and the economy are good. ‘Buyers are nervous, but there are a lot of incentives available,’ she said. ‘One was even offering a car.’”
Excuse me, but when I’m good & ready to buy; I’ll be looking for a nice HOME, not your broken-down second hand POS jalopy.
LOWER YOUR PRICES instead and stick the monthly subscriptions, free car washes and other BS “incentives” up your … well…need I say more?.
I just got done watching Allen Greenspan on 60 Minutes. Basically, he said that housing is going to go down further. He also said in his interview with the Financial Times that inflation and interest rates are going to up, and the central banks can’t do anything about it. He seemed to be implying that Congress ought to step up a bit.
The following statement (from his 60 Min interview) stood out to me. He said “We will get through this. We always do.” I think he meant that the US will not lose its place as the dominant country in the world. I do NOT think that he meant we will avoid a recession, due to the fact that we have NOT always avoided recessions in the past. How do you guys interpret all this?
we will get through this.. I take it at face value.
There’ll likely be even more serious troubles of some sort a couple years down the road .. we’ll get through those too..
basic message seems to be that panic makes things worse, so don’t.
That interview was very interesting, and the first time I’ve seen AG presented as a human being.
This was a GEM:
Leslie: “But Ford and Chrysler are begging on their hands and knees for the Fed to cut rates.”
Alan: “Well, maybe they should just build better cars.”
LMAO
Then we have this one from reuters:
[Former Fed chief sees double-digit rates: report]
http://www.reuters.com/article/businessNews/idUSN1728325720070917
“WASHINGTON (Reuters) - Former Federal Reserve Chairman Alan Greenspan said in an interview published on Monday the Fed would have to raise interest rates to double-digit levels in coming years to thwart inflation.”
All those ARM borrowers are going to feel like real geniuses then!
It almost seems like Greenspan is trying to scare the Holy Poop out of people. I remember all the turmoil he created when he thought there was a 33% chance of a recession this year. Now this! I wonder if that’s gonna punch the stock market in the ‘nads tomorrow…
From North Alabama, late 2007, local real estate web site:
“Huntsville home building chugs on, with more houses on the way. Dr. Niles Schoening, an economist with the University of Alabama in Huntsville, said he heard bankers worry in the mid 1990s here that perhaps the city was being overbuilt. Instead it anticipated the next boom, he said.’
“Huntsville’s real estate market has another dynamic that is keeping things moving, Hughes said. Out-of-state buyers looking for real estate investments have begun to target Huntsville, with its growth and relatively low prices, for properties purchased to rent or to ‘flip,’ buying the house with the immediate intention of selling it for a profit.”
“‘They’ve come in busloads; companies put tours together for them,’ Hughes said.”
http://www.besthomesofhuntsville.com/
Trying again:
I just got done watching Allen Greenspan on 60 Minutes. Basically, he said that housing is going to go down further. He also said in his interview with the Financial Times that inflation and interest rates are going to up, and the central banks can’t do anything about it. He seemed to be implying that Congress ought to step up a bit.
The following statement (from his 60 Min interview) stood out to me. He said “We will get through this. We always do.” I think he meant that the US will not lose its place as the dominant country in the world. I do NOT think that he meant we will avoid a recession, due to the fact that we have NOT always avoided recessions in the past. How do you guys interpret all this?
I took the US would “get through it” bit to mean that he believed that the capitalist-pseudodemocratic institutions will likely survive the onslaught of the disenfranchised masses. Like the Great Depression.
Do you mean avoid the current, active recession or the next one?
“…said John Burns, a real estate consultant…‘There are fewer people who can afford to buy than earlier. So the builders have had to adjust their prices.’”
It seems Mr. Burns is a burnout. Due to the tightened lending standards, there are now more buyers that can actually afford their houses, not less. He’s a little confused.
As most of Southern California faces steep declines in home sales and prices, the buyers and sellers of Santa Clarita see a similar market
It’s interesting that on the way up, every town claimed to be “leading” the boom. At the top, as inventory started building and appreciation stopped, everyone said “it’s different here, so we will be unaffected.” Now that price declines have begun, it’s “oh, we’re just mirroring what is happening at the state level,” as if that somehow makes it better.
With a population of nearly 300,000, Stockton has acquired the unfortunate distinction of having the highest foreclosure rate of any US city, with one in 27 households left counting the cost of the credit crunch, according to Realtytrac, an online marketplace for foreclosure sales.
People are just walking away,” said Taylor. “We’ve seen houses with food still on the table from when the sheriffs have come knocking.”
http://news.yahoo.com/s/afp/20070913/ts_alt_afp/useconomyproperty;_ylt=AlZvQMiTE1.sEPKFfN7jSIOs0NUE
Sales declined for pricier homes, too, but not as drastically, dropping just 32 percent for homes priced at $700,000 and above.
Haha, “just” 32 percent! A mere flesh wound!
Just for fun, I went on Zillow to find out how much property tax was paid on the San Jose house I rent last year. Turns out the property tax alone costs over 4 months rent. Just thought you guys might get a kick out of that.
I mean how much tax was paid last year on the house I rent right now.
I am getting sick and tired of people whining about Texas being unaffordable. 90% of Texas is cheap! Please avoid that 10% with wishing prices, let those FB’s and speculators rot! I am going to show you a few houses below that anyone can afford. If they are not “good” enough for you, you have no business being in Texas, go relocate to NW Pennsylvania, prices are even *cheaper* there. Rent is generally *not* a good deal in Texas because there’s plenty of houses that cost *less* than rent. 90% of Texas did *not* see much of a bubble!
http://homes.realtor.com/search/listingdetail.aspx?ctid=27116&ml=3&typ=1&sid=d62c5c1a752348e38cc8a5721b0030eb&sdir=1&sby=2&pg=111&lid=1084392266&lsn=1106&srcnt=5743#Detail
Nice big house in perfect condition in good, established neighborhood in Dallas for $85k.
http://homes.realtor.com/search/listingdetail.aspx?ctid=27116&ml=3&typ=1&sid=d62c5c1a752348e38cc8a5721b0030eb&sdir=1&sby=2&pg=221&lid=1079058664&lsn=2203&srcnt=5743#Detail
Large 3 bedroom house in established neighboorhood for $130k.
http://homes.realtor.com/search/listingdetail.aspx?ctid=27116&ml=3&typ=1&sid=d62c5c1a752348e38cc8a5721b0030eb&sdir=1&sby=2&pg=220&lid=1088063110&lsn=2191&srcnt=5743#Detail
$129,900
5 Bed, 3 Bath
2,680 Sq. Ft.
Huge house at under $50/foot!
http://homes.realtor.com/search/listingdetail.aspx?ctid=27116&ml=3&typ=1&sid=d62c5c1a752348e38cc8a5721b0030eb&sdir=1&sby=2&pg=255&lid=1070565407&lsn=2542&srcnt=5743#Detail
Very nice house for $158k(you can get one like that for a few thousand cheaper, actually)
I hope this clears up any misconception about Texas being unaffordable. Texas is *not* like California or south Florida where almost nothing is affordable! People are running away from those locating and running to Texas where they can get a very nice house to live in at sane prices. I am tempted to relocate to Texas but big city life isn’t for me and NW Pennsylvania costs half as much. Texas would be a great bet for my parents, wish they had sold in south FL, they will lose their equity and south FL will become cheap enough that they might not want to bother selling if they don’t sell soon. Prices here will fall big time.
I am getting sick and tired of people whining about Texas being unaffordable. 90% of Texas is cheap! Please avoid that 10% with wishing prices, let those FB’s and speculators rot! I am going to show you a few houses below that anyone can afford. If they are not “good” enough for you, you have no business being in Texas, go relocate to NW Pennsylvania, prices are even *cheaper* there. Rent is generally *not* a good deal in Texas because there’s plenty of houses that cost *less* than rent. 90% of Texas did *not* see much of a bubble!
Nice big house in perfect condition in good, established neighborhood in Dallas for $85k.
Large 3 bedroom house in established neighboorhood for $130k.
$129,900
5 Bed, 3 Bath
2,680 Sq. Ft.
Huge house at under $50/foot!
Very nice house for $158k(you can get one like that for a few thousand cheaper, actually)
I hope this clears up any misconception about Texas being unaffordable. Texas is *not* like California or south Florida where almost nothing is affordable! People are running away from those locating and running to Texas where they can get a very nice house to live in at sane prices. I am tempted to relocate to Texas but big city life isn’t for me and NW Pennsylvania costs half as much. Texas would be a great bet for my parents, wish they had sold in south FL, they will lose their equity and south FL will become cheap enough that they might not want to bother selling if they don’t sell soon. Prices here will fall big time.
Seems like you can’t use links or your posts get eaten. You will be able to find those houses on Realtor dot com, do a search for Dallas, Texas, I found those reasonably priced houses in 5 minutes. Why would anyone pay $500k or even $300k when you can get twice the house for $100k to $150k?
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I am getting sick and tired of people whining about Texas being unaffordable. 90% of Texas is cheap! Please avoid that 10% with wishing prices, let those FB’s and speculators rot! I am going to show you a few houses below that anyone can afford. If they are not “good” enough for you, you have no business being in Texas, go relocate to NW Pennsylvania, prices are even *cheaper* there. Rent is generally *not* a good deal in Texas because there’s plenty of houses that cost *less* than rent. 90% of Texas did *not* see much of a bubble!
Nice big house in perfect condition in good, established neighborhood in Dallas for $85k.
Large 3 bedroom house in established neighboorhood for $130k.
$129,900
5 Bed, 3 Bath
2,680 Sq. Ft.
Huge house at under $50/foot!
Very nice house for $158k(you can get one like that for a few thousand cheaper, actually)
I hope this clears up any misconception about Texas being unaffordable. Texas is *not* like California or south Florida where almost nothing is affordable! People are running away from those locating and running to Texas where they can get a very nice house to live in at sane prices. I am tempted to relocate to Texas but big city life isn’t for me and NW Pennsylvania costs half as much. Texas would be a great bet for my parents, wish they had sold in south FL, they will lose their equity and south FL will become cheap enough that they might not want to bother selling if they don’t sell soon. Prices here will fall big time.
*post keeps getting eaten*
something needs to be done about all the eaten posts!
I am getting sick and tired of people whining about Texas being unaffordable. 90% of Texas is cheap! Please avoid that 10% with wishing prices, let those FB’s and speculators rot! I am going to show you a few houses below that anyone can afford. If they are not “good” enough for you, you have no business being in Texas, go relocate to NW Pennsylvania, prices are even *cheaper* there. Rent is generally *not* a good deal in Texas because there’s plenty of houses that cost *less* than rent. 90% of Texas did *not* see much of a bubble!
Nice big house in perfect condition in good, established neighborhood in Dallas for $85k.
Large 3 bedroom house in established neighboorhood for $130k.
$129,900
5 Bed, 3 Bath
2,680 Sq. Ft.
Huge house at under $50/foot!
Very nice house for $158k(you can get one like that for a few thousand cheaper, actually)
I hope this clears up any misconception about Texas being unaffordable. Texas is *not* like California or south Florida where almost nothing is affordable! People are running away from those locating and running to Texas where they can get a very nice house to live in at sane prices. I am tempted to relocate to Texas but big city life isn’t for me and NW Pennsylvania costs half as much. Texas would be a great bet for my parents, wish they had sold in south FL, they will lose their equity and south FL will become cheap enough that they might not want to bother selling if they don’t sell soon. Prices here will fall big time.
Ben, please make this post work!
House costs $900K and it still needs $45K of upgrades including upgraded floors? Geez you’d think for $900K a home would come standard with some decent flooring.