Many Sellers And Agents Are Feeling Highly Motivated
The Times Community reports on Virginia. “Fauquier County Supervisor Bill Downey all but stuck a fork in the 298-home Arrington Knolls proposal and declared it dead. Downey doesn’t believe the troubled project will survive Centex’s corporate ‘bean counters,’ whom he said want to minimize the company’s losses in a dismal housing market of historic proportions.”
“Three weeks ago, Centex abandoned its 358-home Freedom Place project in Bealeton, also without notice. It guaranteed Fauquier tens of million of dollars to improve public schools, roads and other infrastructure.”
“When Downey slammed the company for its ‘horrendous’ performance in Fauquier, Centex Division Manager Joseph Ricketts said: ‘You’re right, it’s been horrendous. The market’s been horrendous. We are truly in unchartered territories as far as what we have encountered….If you talk with people who have been with [Centex] since the early ’70s, this is the worst market that we’ve ever encountered.’”
“‘It’s all about economic sense. And that’s the reality we all live in in this country, Ricketts said. Centex probably should have abandoned the Freedom Place project sooner, Ricketts admitted. ‘We stretched out at Freedom Place for a long time,’ he said. ‘We held on and continued to spend money past the point that [we] probably should have.’”
The Roanoke Times from Virginia. “A lender has taken possession of a spacious $870,000 home in Hunting Hills in what real estate agents believe to be the largest residential foreclosure action taken in at least five years in the Roanoke region.”
“The loan default by the owner of the home in Roanoke County is one example of how the current spike in foreclosures is arcing across all income brackets.”
“Foreclosures have skyrocketed nationally and in Virginia. Foreclosures in Virginia were up 300 percent in July and up 900 percent in August from the same months of 2006, according to RealtyTrac.”
“William Crick, the former owner of the Hunting Hills home, agreed to an interest-only, adjustable-rate mortgage of $882,650 to purchase the Falcon Ridge address in June 2005, according to documents. Crick paid $909,950 for the property, which was newly built at nearly 6,000 square feet.”
“In the spring of 2006…Crick listed the Falcon Ridge address for sale at $1.15 million. The real estate market was peaking in mid-summer 2006, giving sellers the opportunity for the highest prices for their property of the market cycle.”
The Virginia Pilot. “In Virginia Beach, the number of homes in some stage of foreclosure, including notice of default and notice of trustee sale, jumped 25 percent in August to 100 filings.”
“Statewide, the number of home-owners receiving foreclosure notices last month jumped to 3,032, more than double the number in July.”
“The total number of homes in Virginia in some stage of foreclosure in August totaled 3,318 last month, a 95 percent increase from July. That was almost nine times the number of homes in some stage of foreclosure in August 2006.”
The Baltimore Sun from Maryland. “Many sellers and agents are feeling, as they say in the real estate business, highly motivated in today’s market. They’re upping the ante by offering furniture, vacations, even the car in the driveway.”
“‘What I’m seeing is that a lot of sellers’ agents out there are calling buyers’ agents saying, ‘What can my seller do to close this deal? What kind of incentives are your buyers looking for?’ said Realtor Kerri Tkach.”
“A glut of homes on the market and a meltdown among mortgage lenders has created an environment where buyers often have the upper hand. In the Baltimore area there are far more sellers than buyers.”
“Metropolitan Regional Information Systems Inc. reports that last month’s home sales plummeted around the region, dropping as much as 23 percent in Baltimore City and Howard County from August 2006.”
“Michael and Patricia McKinney recently purchased a home in the Phoenix area for about 10 percent less than the asking price. ‘The moment we started showing interest in places, the prices started coming down,’ said Michael. ‘The seller’s agent made it clear to my buyer’s agent that they were willing to negotiate.’”
The News & Observer from North Carolina. “Sales of existing homes in the Triangle fell last month as the worst national slump in 16 years continued to pinch the market. ‘What’s happened nationally has now caught up with North Carolina as a whole and Raleigh-Durham specifically,’ said Michael Helmar of Moody’s Economy.com, who tracks the Triangle housing market.”
“Even steeper declines are likely: The inventory of unsold houses is the highest in at least a year, up 20.9 percent from August 2006. Pending sales declined 15 percent, and showings were down 9 percent. The number of homes pulled off the market was up 39 percent, and the number of price drops was up 39 percent.”
“‘Total [Triangle] sales will probably be 10 percent to 15 percent off last year,” said Ross Rhudy, chief operating officer at one of the region’s largest residential brokerages.”
“One of Rhudy’s clients last week sold a home in the Washington, D.C., area for $590,000, though it cost $700,000 two years earlier. Sales will drop further because the fourth quarter traditionally is slow, and cheap mortgage loans in past years had satisfied demand for homes, he said.”
“‘We had such a strong run that put homes within reach of just about everyone,’ Rhudy said.”
“Buyers can’t expect much help from the Fed’s lowering of short-term lending rates. In fact, the average 30-year fixed mortgage rate rose from 5.875 percent before Tuesday’s rate cut to about 6 percent afterwards, said Glen Astolfi, chief operating officer of DNJ Mortgage in Raleigh.”
“‘What the Fed did doesn’t help the mortgage problems we have,’ Astolfi said. ‘The guys with bad credit still have bad credit and still can’t get a loan. Foreclosures will continue to rise.’”
The Post & Courier from South Carolina. “While thousands of homes are for sale in the Charleston region, fewer people can afford to buy them because their wages are not keeping pace with prices.”
“That’s the message from the Charleston Metro Chamber of Commerce’s Developers Council to more than 100 local business leaders.”
“Rising land costs and an influx of cash-flush newcomers who have sold homes in higher-priced areas, coupled with the recent housing boom, have pushed Charleston home prices to record levels.”
“‘Ten years ago, this was a relatively affordable market,’ said Tammie Hoy, executive director for the Lowcountry Housing Trust.”
“Local real estate agents say savvy buyers can find good deals in this market, but they added that many of the deepest price cuts are being offered in new communities that national home builders are developing in the outskirts of the region.”
‘Statewide, the number of home-owners receiving foreclosure notices last month jumped to 3,032, more than double the number in July.’
‘The total number of homes in Virginia in some stage of foreclosure in August totaled 3,318 last month, a 95 percent increase from July. That was almost nine times the number of homes in some stage of foreclosure in August 2006.’
After seeing the huge increases in California yesterday, it appears defaults exploded this summer, which is probably why Washington is getting uptight, IMO.
As I pointed out yesterday, the graphs in yesterday’s SD Union Tribune foreclosure article show a significant jump in August defaults at the county (San Diego), state (California) and country (U.S.) level. The national number of 243,947 foreclosures in August translates into an annual rate of around 2.9 million. So much for the lame idea that all real estate is local.
http://www.signonsandiego.com/news/metro/20070919-9999-1n19default.html
Richard Mehren, a longtime real estate agent in central and inland North County, remains optimistic that the housing situation will improve locally and around the country. He noted that the Federal Reserve cut its benchmark interest rate by one-half percentage point yesterday, which should make credit easier to obtain and may further ease the pain for some homeowners with adjustable-rate mortgages.
Here’s an agent who clearly should not have a license. He doesn’t even know that the rate cut is for short term loans. The idiot is probably calling everyone on his phone list to tell them about the rate cut. Wait until they call the bank and find out mortgage rates went up and not down.
ARMs adjust based on LIBOR.
When the fed cuts, LIBOR goes down as well.
LIBOR dropped significantly on Tuesday.
He is absolutely correct, this cut will help those with ARMs.
Could you explain the logic of why a FFR cut results in a lower LIBOR? All I can come up with is that the economic picture just became far more gloomy, given signs the Fed is panicking. But perhaps you could enlighten the blog’s readership with an explanation?
Depends on which LIBOR you are tied to. Seems 2 of the rates went up from a year ago and 2 are down. At any rate they haven’t gone down enough to “help those with ARMs.” A 0.50% cut isn’t going to help the FB, whose $1,500/month teaser payment just went to $3,050/month. Wake up or are you just a shill for the REIC?
Most ARMs adjust to the MTA (moving treasury average)1yr. Next month the rate will be approx. 5.25% X 11 + 4.75% X 1 or 50bp /12 (about 4bp below prior payments) plus the spread (approx. 275bp over MTA 1yr. Investors returns on ARM paper are LIBOR spread not the borrower’s rates. Thanks for playing JJ.
LIBOR did not go down due to the FFR cut, but rather due to King’s flip-flop on liquidity-fueled bailouts.
AFX News Limited
UK interbank lending rates fall sharply as BoE pledges to inject more liquidity
09.19.07, 8:26 AM ET
LONDON (Thomson Financial) - The cost at which UK banks borrow money from each other over the very short term fell sharply as the Bank of England (BoE) pledged to inject more liquidity into the market.
The key London interbank offered rate (Libor) for three-month maturities dropped sharply to 6.55 pct from 6.75 pct yesterday, the lowest level since mid-August.
http://www.forbes.com/markets/feeds/afx/2007/09/19/afx4133804.html
Yep. I’ve got a 5-year ARM, and it will adjust based on the 1 year treasury average.
Of course, it doesn’t matter for me, because I’ll pay off the mortgage right before the ARM resets. I ain’t no FB; I planned it that way. A few of us did figure out how to use an ARM intelligently.
Kudos, Mamooth!
Likewise here, mamooth. ING Direct, 3.99% rate good for five years. But if the interest rate is low when the 5-year mark hits, we might keep it; otherwise, big checks will be headed in ING’s direction to pay it down.
I noted that the 10-year bond and thus 30-year fixed mortgage rates (which roughly track it) seem to be INCREASING since the Fed’s rate cut, not going down. Inflation worries anyone? Nah, didn’t think so.
Mortgage rates are headed up-up-and-away with the T-bond market/$US crash that is currently in progress.
CURRENT/1 MO PRIOR/3 MO PRIOR/6 MO PRIOR/1 YR PRIOR
15-Year Mortgage 5.61 5.89 5.99 5.44 5.64
30-Year Mortgage 5.95 6.24 6.29 5.68 5.93
1-Year ARM 5.72 5.61 5.55 5.32 5.31
http://www.bloomberg.com/markets/rates/index.html
The Forbes article above quoted Sterling LIBOR rates not USD LIBOR rates.
Sterling, Euro and USD LIBOR rates are compared here: http://www.creditman.biz/uk/members/news-view.asp?newsviewID=7644
Helicopter Ben just shoved the nozzle up the butts of all the people who had savings and were prudent. The dollar is in the tank. Greenie wouldn’t even say if he owned dollars and Soros is playing the dollar to go down by backing the Dems. I think I’ll take $ out of savings and pay off the house.
Some of these numbers are stunningly bad, but not surprising. Though related, I don’t think the increase in NODs are totally tied to rate resets. How many held out hope of possibly selling during the “peak” warm weather selling season and now that it has come and gone have given up hope? As “bad” as the August numbers may appear to have been, this fall and winter could be far worse.
Monthly NODs and foreclosures already exceed the peak of the early 90’s downturn and are still headed nearly straight up. There’s no sign yet of any decline in the rate of increase.
Bring it on. I for one want to see this “Credit Tsunami” come crashing over my area.
you’ll still be employed ,comrade
people better quit wishing for doom, it ain’t much fun
What’s the alternative? Stay the same? TPTB don’t like that. Stagflation. Or should we try growing trees to the sky? That won’t work either.
Time to get some bearish people in charge who aren’t afraid to hunker down for some time. Enough with Dow 36K, alright.
This economy is running massive debts at every level and has an incredible trade deficit. To top it off we are in a senseless TRILLION DOLLAR war with no chance of winning short of nuking it and killing everyone there, as well as, pissing off the rest of the world for sure.
Yeah, I should be all giddy. I think I’ll buy a Ford F-650 (have you seen these monsters?) and a 2 million McMansion. And I’ll do it with a NINJA/NINA loan.
RIGHT!
Everything is so rosy.
Nuking them all? (slaps forehead). Shoulda thought of that sooner. Get Bush and Cheney on the phone NOW.
people better quit wishing for doom, it ain’t much fun
Who here is wishing for doom? What I’m wishing for is is a sound thrashing to people and lenders who took on insane amounts of risk, gambled on ‘20%/year forever’ appreciation and now want saver-taxpayers to bail them out. Followed by a return to sane housing prices justified by the economic fundamentals (incomes & rents).
Looks more like ‘justice’ than Gloom-n-Doom to me.
I agree. Let the chips fall where they may; if speculators are wiped out so much the better. I’m tired of living in an economic fantasyland.
As someone else said in another post……wow, wow, wow. The suddenness of the rise in foreclosures is incredible, and we still have another year or two of major resets to go through.
That was me. I said “Wow! Wowie-wow wow wow!” Seriously, when I saw that Tampa Bay area foreclosures had doubled month over month (from like 3000 to 6000, roughly), I was completely dumbfounded. Gob-smacked.
The effects of the bubble are so incredible, I’m having these fits of laughter, because that’s where we are now and things haven’t even gotten cranked up good yet. Another thing that’s making me laugh are the really feeble efforts of the gov to pee on the forest fire. (Raising limits on FHA loans, gawd, what can you say to that?) And thirdly, when I read txchick’s link to Kass about how the rate cut is REALLY going to decimate the housing market, it made my day.
Have to admit I’m smirking a bit myself as well. I respectfully disagree with the poster above who says quit wishing for doom. I believe now more than ever this country needs an economic cleansing and the sooner we get it over with, the less painful it will be, even though it’s going to hurt. Who knows, I could be hurt too, but that’s the way it goes. Maybe the next generation can learn from our mistakes.
Well, Blano, like the headline on Ben’s post above, I guess you could say we are feeling “highly motivated” today.
nope, it was may 05 peak
The real estate market was peaking in mid-summer 2006, giving sellers the opportunity for the highest prices for their property of the market cycle.”
Sales may have peaked in ‘05, but prices around here in Northern Virginia appear to have peaked in Spring ‘06.
–
True of many areas. Prices lag the volume by 6-18 months.
Jas
in my hood 22151 peak was may 05 dropped 11% to sept 06 and have stayed there- big gov still hiring
The sooner the “Silent Bubble” of the Maryland, DC, and NoVa region ends, the better.
No, we’re not all rich here because of DC being nearby. In reality, we’re not that much better paid, but the cost living is insane. At least the Maryland governor will be raising taxes as a recession looms… duhh…
We also had a summer ‘05 peak here in Tucson. The local REIC is just now getting around to admitting it.
But, then again, they have been a bit distracted by…
http://www.azstarnet.com/sn/firstmagnus/
Slim,
I’m speachless!
From the original post:
The Baltimore Sun from Maryland. “Many sellers and agents are feeling, as they say in the real estate business, highly motivated in today’s market. They’re upping the ante by offering furniture, vacations, even the car in the driveway.”
Oh, puh-leaze. Just drop the price.
“‘What I’m seeing is that a lot of sellers’ agents out there are calling buyers’ agents saying, ‘What can my seller do to close this deal? What kind of incentives are your buyers looking for?’ said Realtor Kerri Tkach.”
Jeebus Cripes. These people JUST. DON’T. GET IT. Drop the price! Except, as we’ve found out, it isn’t that simple, because people are underwater on the mortgage.
Right. Also some sellers (or wannabe sellers) will also wind up owing steep prepayment penalities if they try to sell early.
And they think they can buy a $25K car so that they can maintain 50K in the price, netting them a tidy $25K profit, or reducing what they have to bring to the table. How much you want to bet they do that with “high-end” kitchen makovers and paint jobs?
Keep your ratty overdesigned junk from Lowes. I’ll redo a kitchen the way I want, thankyouverymuch.
Got attached product?
Or…
They can still get a loan for the car, but can’t get a loan to cover the shortage on the mortgage. So they are essentially borrowing to cover their ‘underwaterness.’
Few have the capability to drop the price. Since many have interest only loans and did not pay much down payment, there are little equities in most houses for sale. To lower the price to a point that selling price is lower than original-equity+transaction fees,the seller have to bring money to the closing table. Even some want to do just that, the question is whether they have money. The other possibility is short sale, to lower price like 20% the bank have to take huge losses, right now it is not happening.
What kills me are the homes that have been on the market 100, 200, even 300 days where the agent states in the listing description “Highly Motivated Seller”. That’s like a “highly motivated” full time student taking seven years to get an undergraduate degree.
Because buying a depreciating asset (no, not the house… hehehe… the car, furniture, etc.) that is financed over 30-years instead of paying less is such an attractive deal! Not!
“‘What the Fed did doesn’t help the mortgage problems we have,’ Astolfi said. ‘The guys with bad credit still have bad credit and still can’t get a loan. Foreclosures will continue to rise.’”
Is the Fed even aware of the nature of the housing market’s raging forest fire, or are they deliberately turning a blind eye to it? I can’t see how ignoring a raging firestorm, much less adding fuel to it, will help to put it out.
I just want to know…who are these buyers they yammer on about? Huh? I just can’t get my head around a vision of who’s out there…I mean, there are few here who I know are actively looking, but isn’t the biggest pool of potential buyers the ones who are selling? And even if they drama price, are they really going to able to turn around and buy again? The illegals and landscapers-turned-paper-millionaires are gone. The “boomers” need every bit of scratch they have left to pay for healthcare, etc…they can’t count on condos financing the golden years. Really, someone give me an idea of what a buyer looks like these days. Cause these assumptions about the hoard of buyers that are going to show up as soon as the sellers get “motiviated” seems kinda ridiculous.
I have 2 places I can’t seem to give away- and they’re rentals
And even if they drama price, are they really going to able to turn around and buy again?
More importantly, if they get out of the mess they’re in, and sell, do you think they would even want to buy again. I know I wouldn’t if I was in that position.
I totally agree. There are no “buyers” left. After a few years of this nonsense we will actually start selling homes to folks who actually work for a living. Sh*t, if they have a deposit then they’re golden. What a concept.
But the prices are way to high. Normal working folks can’t finance a 650K home. They will have to wait until an average home is 250K. At least here in CA. The RE people and the Feds need to pull their head out of their ass and realize the system is jacked up. Their is no fix guys.
Well this is one fix.
There could be a Presidential decree..200% pay raise for everyone across the board.
That would make houses affordable again.
Is a president a king that he can make decrees with the force of law?
No, sellers would just anticipate the pay raise and raise house prices accordingly. — JUST like they did for when lending standareds went to pot. When people got approved for higher amounts of debt, house prices went up accordingly.
“And even if they drama price, are they really going to able to turn around and buy again?”
Well now I have a related question. All the time we hear sob stories about people who have to “unload” or else they will lose their home — which is why we need a bailout etc..
They want to sell. If they sell, where do they go?
They lose their home. Now where do they go? Do they go to the same place as if they sold?
They (Heaven forbid) rent.
We rent and Heaven didn’t forbid it (just joking!).
Catherine is right. Who is left? What does a buyer look like? Outside of some few FBs that are still left the market has just about all but locked up. Thank you Neil and many others for calling that one.
Gubmint and sellers still don’t get it.
We are not going to buy your overpriced junk so you can…
1. Get out from being massively underwater and taking on more water faster than the Titanic.
2. Pay for your retirement. Sorry, I fully expect to work until 75 or 80. I also will help family. HOWEVER, as much as I love you guys on this board, I will not take care of your parents. Not my job. That is between you and the family. Besides, many of us already have, are, or will pay into SS.
3. Not going to pay for your mistakes in life.
4. Not going to pay off your CCs, the Queen Mary II vacations around the world in the captain’s suite, your Escalade and the wife’s Benz.
5. Not going to pay to send your 5 kids (darn breeders) to ballet, baseball camp, gold classes, private school, and then college.
6. Fund anymore of your ridiculous spending.
7. Pay for your retirement at 35. Nice idea, but you have to earn it yourself.
8. Cover the mistress’ boob job.
9. Cover how inflation is affecting you. Heck, we all have this problem unless we have 100’s of millions in the bank.
Did I miss anything? Oh yeah, the granite countertops!
But, but, but, it takes a village, Dan!
No way, I hear ya, now’s the time to have a plan B, C, D, and E to avoid even beginning to pay for the stupidity that’s overruning us. Stay liquid and stay portable.
Say, in Dicken’s Great Expectations - who was the (minor)character who only believed in “portable property”? Anyone?
Wemmick
Thanks Gal! Sure, I could’ve googled it, but this way is much more fun.
“‘We had such a strong run that put homes within reach of just about everyone,’ Rhudy said.”
Oh, Rhudy, don’t be a jackass. The ruse is over.
From the ska classic “A Message To You, Rudy” (no re-write needed!):
Stop your messing around
Better think of your future
Time you straightened right out
Creating problems in town
Rudy, a message to you
Rudy, a message to you
Rhudy’s on a train to nowhere, halfway down the line…
Cool - that’s my favorite Supertramp tune.
Supertramp…you mean that Suzanne chick is back?
Ah…the specials
Ahh, especially the midnight special
Fauquier County has to be toast. No one in their right mind would want to commute to the DC-area job hotspots from there.
“Three weeks ago, Centex abandoned its 358-home Freedom Place project in Bealeton, also without notice. It guaranteed Fauquier tens of million of dollars to improve public schools, roads and other infrastructure.”
BWAHAHAHAHA! Way to go, Centex! Whaddya wanna bet that money’s been spent, too, before they even got it.
Fauquier County was mostly farmland as little as ten years ago. It wasn’t really considered part of the DC area when I moved here in the early ’90s. I’m sure a bunch of local civic booster types got dollar signs in the eyes when they saw the homebuilders rushing in. Probably lots of bogus government projects all over the place that the local economy by itself can’t support. Hopefully they haven’t managed to pave over every square mile of the county yet…
Our area (South Hillsborough County, Tampa Bay) was mostly farmland even five years ago. Overnight the hideous developments went up. Always in the spring you could count on the scent of orange blossoms from the groves. Not this year.
Developers like to buy farmland because it costs so much less - then they get the city council to rezone it - the land is instantly worth much more.
We should make developers pay the difference in the value of the land that they get rezoned so that farm land is not more attractive to them than lots that are available in the city - it would reduce suburban sprawl and encourage developers to build where the housing is actually needed.
Agreed. Otherwise, they’ll eventually pave over every farm and forest.
Who needs things like trees or food when we have malls and McMansions!
Check out Jim Rogers. Truly scarry in light of the Fed’s action on Tuesday.
http://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vjUSJ.lwS8e0.asf
Just heard that the Canadian dollar is now worth more than our peso…
Funny you should mention that! I’m working with a client on a project that involves a Canadian vendor. Although the project is continuing, the vendor has already told us that the price is going up. Something about the decline of the U.S. dollar…
Dollar in freefall; down over 90 basis points! Silver up 5%.
http://quotes.ino.com/chart/?s=NYBOT_DX&v=i
I wonder how many BILLIONS Warren Buffet is making on this dollah collapse
Buffett sold his silver long ago, for no gain.
Watcher why so negative about the dollar? The Dow just keeps going up, despite the fact that our manufacturing base keeps eroding. Not only that, but inflation is contained as is the mortgage tsunami. Sarcasm off.
Oh well, with the dollar freefall, I guess that those out of country vacations are out of the question, except for the uber-wealthy.
This is such a mess, the economy. Think about. Despite making killings in the stock market, gold, silver, etc. you still need cash to buy stuff. The less valuable the dollar the more it takes to buy stuff, therefore you need more gains on everything else. What a racket.
I guess Keynes was right, “In the end we are all dead.” Even when I feel fortunate to be out of debt, have a good job, have money saved, it still feels like it is all just a big game.
Rant off!
WA still booming ? from Yahoo marquee
Housing market in Washington state booming
Apparently “booming” has been redefined to mean: not crashing as quickly as Florida.
Noticed this headline earlier this week, I guess the FBs are having to eat at home more now…
http://www.nytimes.com/2007/09/19/business/19kroger.html
If you want to listen to AG interviewed for an hour, here is the place to go:
http://wamu.org/programs/dr/
He indicates that the odds of recession is almost 50%.
i have the odds at 100%
150%
He’s about 100% behind reality.
He was on the Daily Show yesterday. Can’t get a link to work, but it’s on their website. I have a lot of respect for old age, but this was a bit ridiculous.
sagesse-
Even a-holes get old too, so its the character of the person, not their age. Greenspan was a young a-hole, that just aged.
The fact that the Raleigh-Durham area is starting to crater should really scare everyone. Its an area that has some of the best fundamentals of any area in the country (job growth, relatively low cost housing, etc…).
Anecdotal job growth story; I know a guy who worked a temp job for $10 an hour for a year in Raleigh. The job finished, he went back to the agency for a new job…they don’t have one for him. The lady says to him they are getting 200 more applicants a week for jobs than a year ago. So much for job growth.
If you go to craigslist Rants & Raves, *everyone* is making six figures!
If it’s on the internet, it *must* be true!
How funny, everyone making six figures.
I do make six figures and my goal is so different.
We are closing in on six figures cash savings…I guess that we are weird. And no debt for 5 years.
Funny thing is, we could buy things that we like, but just knowning that we can do it - brings satisfaction! So, we don’t BUY much at all.
Those “six figures” types - they never got enough hugs when they were young.
You’re not supposed to count the two to the right of the decimal point…
Wow! That is something else. The triangle WAS the promiseland for many transplants. Cheap homes and plentiful jobs in tech, life sciences, retail, etc. Everyone and their mother moving here, and they STILL had the worst declines in 16 years. If the triangle is screwed, they’re all screwed. Ever worse, since everyone *felt* rich moving down here, they continue to drain their wallets at expensive Raleigh/CH restaurants. Suckers!
The average income in RDU is still low and there has been a big run-up in home prices in hot areas like North Raleigh and Cary. Most of the people who move here are not making 6 figures in RTP, despite the stereotype. The area has lots of room to fall IMO.
Here’s a question — will any of this affect the NAR’s median home sales price, due in mid-November? What will it show?
Ron Paul was awesome in his questions of Bernanke.
Too bad he didn’t get an answer…..
Do you have a link?
Ron Paul ripped BB and raised the PPT! Ron Paul, you’re my hero.
Fabulous! Check out the link, sorry no tinyurl.
http://www.lewrockwell.com/blog/
Gotta scroll to second video.
http://www.lewrockwell.com/blog/
Thanks!
““William Crick, the former owner of the Hunting Hills home, agreed to an interest-only, adjustable-rate mortgage of $882,650 to purchase the Falcon Ridge address in June 2005, according to documents. Crick paid $909,950 for the property, which was newly built at nearly 6,000 square feet… In the spring of 2006…Crick listed the Falcon Ridge address for sale at $1.15 million.”
As can be seen again, a lot of these FBs will go down with the ship. They cannot accept a loss (or afford one) and they will chase profit all the way to foreclosure. The kool-aide is still in their veins and and only foreclosure will shake some of these overpriced homes loose…
Their lenders will lose much more than these FBs.
The notion of buying a house for $900,000 in Roanoke just boggles my mind. I guess there are some golf communities around there, but mostly surrounded by lots of Appalachian poverty and a zillion miles from anywhere. These type of luxury getaway communities are going to get killed.
So right Chris. Additionally, in less than a year this guy was selling for 250K profit. Come on, flipper alert! If this guy really needed to get out: divorce, death, job loss, etc. he could have just cut the losses. Me thinks that this guy wanted to get rich quick, but ended up underwater.
The prices of homes seem to be in large retreat in locations that people really don’t want to live. The very good zip codes have had some fall back but for the most part it hasn’t been nearly enough and i venture to say if it hasn’t happen by now most homes in good solid locations will just fall off the market and wait it out.
It looks like if you want a bargin you still have to shop discount stores, the elite can and will wait it out.
More likely, the ‘elite’ communities will be the last to fall. But if prior bubbles are good indicators, they *will* fall. Especially if you are talking about entire zip codes. I’m sure a few of the most expensive areas with real (not Mc)mansions are immune, simply because those houses are not bought by people who need to take out mortgages.
“Michael and Patricia McKinney recently purchased a home in the Phoenix area for about 10 percent less than the asking price. ‘The moment we started showing interest in places, the prices started coming down,’ said Michael.
- It sounds like Mike and Patty overpaid by 20%.
10 Year Treasury Note is now 4.67% - Fixed rate mortgage rates are going up for sure.
Sobay> I ask a recent new neighbor if you don’t mind me asking did you get a deal on your new home his reply ( he is from Denver) i wanted this area, i got a good deal not great i didn’t want to lose this house and i didn’t want to live further out i was willing to pay more for this zip code? May be he should have asked for more off but in his mind he was willing to pay whatever to get this area there are still buyers like that.
Good for him. Not for me though. If I need to be close, I’ll rent. Why capitulate to these moron sellers. This guy is just helping to keep this mess going for another day.
Yes I see them in my area too.
One of the places that are decline-resistant (not immune) is Rose Valley, and the other is Narberth. These are two locales that people flock to. They’re not the haunts of the ultra-rich, they appeal to upper middle class families that like the amenities of the burbs with easy access to the city. And neither is anywhere close to a McMansionville.
Midwest-lots of cheap homes even in areas of high income
EX: Dublin OH
http://www.epodunk.com/cgi-bin/genInfo.php?locIndex=16628
“A lender has taken possession of a spacious $870,000 home in Hunting Hills…”
Correction: “A lender has taken possession of a spacious $370,000 home in Hunting Hills currently priced at $870,000″.
http://www.ronpaulhq.com/blog.php
Video-Ron Paul’s ?’s to Congress and BB Sept 19th, 2007
How do you find out what’s going on in your own area? Local realtors say sales down 14% since last year. Permits coming down since 2003. Don’t know how to find foreclosure info, clerk & reocrder gave me the runaround. Media here is mum. Are we different? Heh.
the fed screwed the whole economy in the long run. dollar collapse, oil higher, inflation to take off…fed to raise rates. greenspan even said rates will have to rise over the next 5 years because of inflation. falling dollar means more inflation in the US. i was in canadain april .89 us cents for $1 canadian…now 1=1. so a 10% fall in 6 months. when will china adjust their currency more…its coming! foreigners to dump dollar, MBS, and american bonds. this is going to cost us!
I still stand by my belief - 40 - 70% drop in prime and “real” wealthy areas, 90+% death plunge everywhere else. Same thing for most other assets outside of real estate too.
Then stock up on MREs and ammo, because if your prediction comes true there won’t be any more use for money. What could you buy, once the world as we know it ceases to exist?