‘Bubbles Burst, They Really Do’
It’s Friday desk clearing time for this blogger. “You buy the biggest home you can afford and use every dime to do it. Now, the worth of your home takes a nose dive. The bubble has burst, leaving you in a financial mess. Don’t be afraid, like most nightmares, this one’s a lot less scary in the light of day, where following a number of dos and don’ts can lead you to the best possible outcome. DON’T panic.”
“Use your own judgment. Are long-term interest rates going up? Are existing houses sitting on the market longer? Is it much cheaper to rent? Is the number of second homes increasing? Are people investing in the local home market to make money, rather than to live in a home? ‘One of the frequent definitions people give for bubbles is if people are buying just in expectation that the prices will rise, than out of some underlying need,’ says Andrew Leventis, an economist with the Office of Federal Housing Enterprise Oversight.”
Ghosts of S&L’s past? “It appears that the appraisal that Neil Mohamed Husani and his partners used to get bank financing for what is the proposed site of a $125 million condominium tower contains ‘wrong and misleading information.’”
“Husani created a stir in Southwest Florida’s real estate community when he got a $16.25 million loan from Fifth Third Bank on property whose value apparently more than doubled in a day. ‘I’m not concerned about my appraisals,’ Julien Stokes said. ‘If I’ve been duped, I’ve been duped. I can’t help it if people purposefully duped me.’”
“In a signal that some bargains may be just around the corner, the government reported the number of unsold new homes on the market hit an all-time high while the average price began to fall. Economist Joel Naroff says the February report has some anomalies, but could be the sign that the housing bubble is finally bursting. If so, he says, it won’t be pretty.”
“‘I have said this before but I will repeat it again: The next time a housing bubble gently deflates will be the first time a housing bubble gently deflates,’ Naroff said. While existing home sales were up in February, Naroff says that could quickly change, with the three words most feared by real estate agents; ‘low ball offer’ becoming the market’s new rule.”
“‘That time is coming,’ Naroff said. ‘Bubbles burst, they really do.’”
“The housing boom in northwest Arkansas might have reached its peak, according to a new report that suggests the Hometown housing market is overloaded. ‘When supply and demand are out of whack, usually we see prices adjust,’ said University of Arkansas economist Kathy Deck. Experts also said that bankers might change the way they loan money to builders if an oversupply problem continues.”
“Sales of detached single-family homes declined in February for the fifth straight month, according to the Massachusetts Association of Realtors, and a growing glut of supply may bring prices back down to earth. Prospective home buyers who decided to wait out the fervor of the recent housing boom may see their patience rewarded this spring.”
“Following on the heels of a slowdown in sales of existing homes in California, the sale of new houses dropped almost 30 percent in the West in February. The number of homes sold in the Fresno area fell by a third in February from the year before. Home sales fell about 33% in February.”
“Sellers in the central San Joaquin Valley are adjusting prices downward from supersonic levels. They are having to list their homes at a price similar to what competing properties sold for, rather than substantially above market rate, said (realtor) Dave Sawyer.”
And Newsday has a book review. “‘Why The Real Estate Boom Will Not Bust, And How You Can Profit From It.’ By David Lereah. $12.95. Purpose: To explain why the real estate market will continue to expand, despite media speculation about the boom, and how first-time buyers and experienced homeowners can reap the benefits from real estate as an investment opportunity.”
“Excerpt: ‘What we are seeing today is a phenomenon that takes place only every other generation: a long-term expansion of the real estate market. And that is why you need to take advantage of this once-every-other-generation opportunity now.’”
“While one might appreciate the path the book takes with all its useful information, the title may mislead readers into believing that the book is written to prove ‘why the real estate boom will not bust.’ It certainly covers the ‘and how you can profit from it’ part thoroughly.”
Another great week of building a housing bubble consensus! My thanks to those who support this blog with ad clicks or donations. Check back this weekend for news, your topics and market observations. Be sure and carry that digital camera with you this weekend for the HBB slideshow.
“You buy the biggest home you can afford and use every dime to do it. Now, the worth of your home takes a nose dive. The bubble has burst, leaving you in a financial mess. Don’t be afraid, like most nightmares, this one’s a lot less scary in the light of day, where following a number of dos and don’ts can lead you to the best possible outcome. DON’T panic.”
FIRE!!!
“It appears that the appraisal that Neil Mohamed Husani and his partners used to get bank financing for what is the proposed site of a $125 million condominium tower contains ‘wrong and misleading information.’”
Od course. The bank knew this. Think about it. Bank guy 1 tells bank guy 2; “there’s something wrong with this app.” BG2; “Shhhh, yes. Don’t say anything. We can get the commission and pawn it off in 2 days. If anything goes wrong , then, and only then do we discover the fraud on -their- part.” Get it? Heads we win, tails we win.” BG1; “Ohhhh, I get now. I’ve got a bunch more just like this one. Keep your approval stamp out, I;ll be right back!” [Humming, "we're in the moneeee....we're in the moneeee...."]
>[Humming, “we’re in the moneeee….we’re in the moneeee….”]
The visual I got from that cracked me up! (Big sh*teating grin, bounce in his step)…
Seek help immediately. Laughing at my comments is the second sign of something far more serious.
Ellie Mae: “Hey Paw! Kin me an some of mah critters go swimmin’ in the see-ment pond?”
Jed Clampett: “Why shure enuf. You’ns jus be shure this time you preserve the equity of our lev-er-aged invesment bah a doin’ it topless when the reel estate spec-u-lators come by.”
“If you can afford your payments and you like your house, a bubble can’t really hurt you.”
These idiot journalists ought to give this oft-repeated but patently false chestnut a rest. Think about it — you streched your finances to barely qualify to buy that OC dump for over 1/2 million buckaroos, and if you are lucky, you will be able to hold on to your two jobs which enable you to keep up with payments at 50% of your income. This is all OK, because you realize that the value of the property will go up by 23% a year for the next ten years, so you will technically be a millionaire if you can stay in the game that long…
POOF! Wake up from your dream, and discover ten years down the road that although you somehow managed to continue making your payments (despite a divorce and a very unhappy time desperately struggling to hold on to those two jobs), the nominal value of housing went flat, and so the paper value of your investment is the same as it was when you bought, you have sunk large amounts of money into interest payments, taxes, insurance, and maintenance, and the real value has dropped due to the pernicious effects of steady inflation.
What about this scenario suggests a bubble can’t hurt you as long as you can afford the payments?
By the way, notice that I assumed prices would not drop over the next fifteen years and stay there the way they did in Japan from 1990-2005. I gave y’all the benign scenario, not the gloomy one…
I almost feel sorry for these poor fools! But than I think about all the Moms at my kids school that constantly tell me “Oh, there is a house for sale in my neighborhood. But it’s 800k!” I think they enjoy saying these things to me. Not a week goes by without someone feeling sorry for my rental status. Little do they know I’ve got megga cashed saved. Or maybe they are just jealous because I’m HOT! LOL
Come to Papa.
lol
HOW HOT??
Start practising your revenge now :twisted:.
“Hey, I noticed there’s a foreclosure listed just down the street from you. Have you any idea how low the bank would go?”
You go, girl!
Ha! Same thing with us. Neighbors used to say, “Oh, you should buy the house down the street from us. It just came on the market at $900,000″, as if it were a bargain price. The same people would admit to us that they couldn’t buy their own homes at the prices they were “worth”. We actually could afford to spend that much, we’re just not stupid enough to spend nearly a million bucks on a cheaply built tract house that sold for $400K three years ago.
We really don’t get the renter pity anymore, though. Many of our friends now say “you were smart not to buy.”
I don’t feel that smart; rather I feel like the gambler who got lucky. If the coin toss had landed the other way, then I would be a priced-out renter (and I am still not 100% sure on which side the coin landed!). Unfortunately, we live in a day and age when our national economic situation forces even financially conservative individuals to gamble… WE ARE ALL GAMBLERS NOW.
very well said …
Excellent point. And so many people have stretched, using these suicide loans. They really NEED to have the house appreciate AND for rates to stay ultra-low so that they can re-fi every year and pay off the credit cards they were using to live on because they couldn’t really make the mortgage. Vicious cycle, this one…
That’s really the story here — Make-believe finances. There’s no question that the scale of this meltdown will be a shocker to all those suggesting the best outcome - The make-believe soft landing.
The truth is, given how homes were used to serial-refi basic survival in a great many cases, there will be a massive flood of homes that revert to lenders. At first there will be the stubborn hold-outs, many of those even on this blog, that will snap them up. That pool will dry up in 1-1/2 years and then what? Smart investors, those that had the common sense to move to the sidelines and sell into the frenzy, won’t budge easily.
MASSIVE LENDER INVENTORY WILL ENSUE!!!
the other day I was at the library and laughed when I saw they had lereah’s book about stocks published around 2000.
De Ja Vu
Point:
‘And Newsday has a book review. “‘Why The Real Estate Boom Will Not Bust, And How You Can Profit From It.’ By David Lereah. $12.95. Purpose: To explain why the real estate market will continue to expand, despite media speculation about the boom, and how first-time buyers and experienced homeowners can reap the benefits from real estate as an investment opportunity.”’
Counterpoint:
“‘I have said this before but I will repeat it again: The next time a housing bubble gently deflates will be the first time a housing bubble gently deflates,’ Naroff said. While existing home sales were up in February, Naroff says that could quickly change, with the three words most feared by real estate agents; ‘low ball offer’ becoming the market’s new rule.”
“‘That time is coming,’ Naroff said. ‘Bubbles burst, they really do.’”
There you have it, folks. Which of these experts seems more credible?
“‘low ball offer’ becoming the market’s new rule.”
It is unnecessary for ‘low ball offers’ to become the market’s new rule in order start the ball rolling on a none-gentle housing price deflation. All you need is an inventory landslide, and the low-end of the distribution of seller reservation prices for comparable housing is where the sales action will occur, and what will lead the market back down to fundamental value…
Its very interesting to me how the new values will be established . For a starter I think you can wipe away the 2005 gains eventually .
Here in South Florida you can wipe out 2004 and 2005 gains. I look for 2002-2003 prices in 2009-2010.
I can show you some houses in San Diego that have asking prices which are at or below 2004 prices. Look for this thing to bottom at 1999/2000 prices **IF** things are good. All bets are off if there’s a recession/depression (very likely, IMO).
They are already gone in SD. The reason inventory goes up by 50-100 homes every day is that none of the new listings are going for the recent comp price…
BTW, the last few days I have seen new listings > 100 per day for greater SD…
Sorry but you gotta watch this video. Diane Sawyer’s opening comments just make you cringe to think how little the media is helping in getting the truth out. Great weekend to you all….
http://abcnews.go.com/Video/playerIndex?id=1763785
Video suggests you show your condo. on line for sale and view through you picture window is that of wall of adjoining building or a power transformer so with some digital editing, according to barbara corcoran you edit in some sky, some clouds or maybe mt. fuji off in distance and ask a higher price.
Barbara can you spell fraud??
In this context, Diane Sawyer just reads what’s put in front of her…if/when the downturn gets bad enough, she’ll read the negative copy that’s put in front of her as well…
I guess attractive-looking female news anchors cannot be held liable for the spewage their bosses require them to read on the national news?
Attractive? Stucco, how old are you?
I am older than I look. To be honest, I don’t really know what Diane Sawyer looks like anymore, as I don’t watch the national news these days!
I think Diane Sawyer dated Allen Greenspan. When asked why an attractive woman would date a guy like Greenspan, he replied “power is sexy”
While the ‘market still sizzling’ is er questionable (unless it’s sellers in the pan– there were actually a couple good points in there from the realtor hack. Like get your own inspector (hell, for the 110 hours of training required, you could damn near do it yourself). Or as buyer, negotiate the commission.
Was the first time I’ve heard the doctored photo bit from the Realtor group though.
First time post from bubbly Boston,MA.
Inventories here are exploding! One property on my street just took a 50K haircut!
Welcome Aboard Hectore 3! This is the best Blog I have ever come across… you’ll have fun here!
Still waiting for the bubble in the Portland Oregon market!!
You’re waiting for it to arrive, or you’re waiting for it to burst?
Portland is a bit late to the game. Hopefully, it will make it easier on us. However, that South Waterfront neighborhood makes me nervous. Premium prices, disconnected from the downtown area, and massive buildings. I think that area has “speculator” written all over it.
“Bubbles burst, they really do.”
I wish someone would tell that to the folks on the SF Peninsula. The market around here is marginally less frantic and pricey (5-10% less) than 6-12 months ago. There have been a few price reductions and some ugly duckling listings that have been on the market for 60 days or more. But overall homes continue to sell quickly and inventory is sparse.
Maybe if I close my eyes, click my heels together three times and repeat to myself, “Bubbles burst, they really do”!
Hmm. I’m not seeing in action in San Jose, Santa Clara, Los Gatos, Saratoga, etc. What area are you tracking??? SC County inventory has JUMPED in the last week - especially the last two days.
Menlo Park, Palo Alto, San Mateo and Burlingame. Many Feb/March listings have gone pending in a week or less.
Seems up and down to me. This is a slow week for sure. Not many new pendings at all.
(B’game, San Mateo, Belmont, San Carlos)
I noticed earlier in the year that many of the Palo Alto listings were being snapped up as soon as they hit the market. I don’t follow that area on a daily basis though.
Face it — Cali is doomed. Ground zero for financial hard times in the U.S.
‘I’m not concerned about my appraisals,’ Julien Stokes said. ‘If I’ve been duped, I’ve been duped. I can’t help it if people purposefully duped me.’”
Julien, look around the table…If you dont know which one is the sucker, it is probably you.
What wonderful quotes we are seeing on stories this week.
Here’s another one:
Slowly, slowly, the roller coaster reaches its summit.
As it peaks…
as the news media piles on with more and more soundbytes like these…
and as the CAR/NAR find it harder and harder to whitewash the growing inbalance in affordability/inventory/over zealous speculation with lame excuses like “this time is different”, “this place is special”, etc…
the pale faces of those strapped on board will turn white as they realize the truth– but too late.
…and RE will descend quickly down the tracks at ever increasing speeds.
I thought that real estate deflated slowly in 1989? 1989-1997.
I will assume that the six year time horizon is what Naroff had in mind when he said “bubbles burst.” Nobody who pays at least a little bit of attention to economic history would give much credence to the real estate shills who keep saying “No bubble around here” while meanwhile, the looming inventory landslide gradually creeps towards the homes they expect to keep yielding 10%+ per year forever…
The housing boom in northwest Arkansas might have reached its peak, according to a new report that suggests the Hometown housing market is overloaded. ‘When supply and demand are out of whack, usually we see prices adjust,’ said University of Arkansas economist Kathy Deck. Experts also
Arkansas?
If one more person tells me that this is a regional bubble I will puke. This bubble is everywhere and I am stunned.
Everyone wants to live in NW Arkansas, because that is where Big Box Mart is headquartered…
http://www.jibjab.com
anagram SOFT: Snooker other fools today
: Sucker only for today
: Seek other-directed fresh toady
You have “landed” on a good working definition of SOFT.
LOL!
Lereah is a dildo! Him and all these other industry bureaucrat mouthpieces; people who are “real estate folks”… but have never done a real RE deal in their fuckin’ lives!@! They just talk (or write) about it. No bubble?!? My ass! At least in certain markets. Omaha, NE may be fine. As far as mine, CA, it’s gonna be one hell of a bonfire!
As a broker and mtg banker actively in the trenches everyday these posers make me sick!
Can’t wait till the ranks thin out (a lot) due to attrition. There are so many worthless fucktards in the business right now; makes me almost ashamed to be identified and painted with the same brush by being in the business. I love this business and it can be a good one, but all this damn flotsam and shitsam in the last several years… good riddance!!
Course, as the cycle turns, that’s where I make my real $$$; cleaning up the huge mess in the sandbox caused by all the little kiddies and their dreams of real estate stardom :_ )
With you on this.
Nice post! Pretty much sums it up.
too bad for the real pros in the business
The comments made by the experts are explaining the obvious. But at least saying it. David Learah is a big buffoon.
I’ll stick my neck out and say that Charlotte is still a stable market. Because all we’ve had here for years is single digit appreciaition, there’s not much froth to blow away.
Uptown condos are a different matter, though. People are paying $350/sf for these little skyboxes, in a market where there are plenty of suburban SFR’s for $120/sf. I still haven’t figured that out.
[Charlotte] If there’s not much froth then you’ll be “lucky.” You’ll only participate in the 7%+ y-o-y declines for the next 3 years. Lucky you.
Charlotte is like Boston and several other places with respect to urban trends. Unfortunately for Charlotte last to the party is first to be cut off from the punchbowl.
See, this is something people seem to have a hard time with. The less desirable markets will fall first and harder and will take longer to recover, if they ever do. People still want to live in SF, LA, SD, NYC, etc. They just bitch because it’s too expensive now. When it gets less expensive, who’s going to abandon LA for Charlotte or Dallas? Nobody with above a room temperature IQ. It’s like stocks. In a bear market, the generals, or the best stocks, are the last to fall and when they do, that’s usually the end of the downturn.
I’ve wondered about this phenomena myself. If an area DIDN’T skyrocket with all the EZ Money, low interest rates and constant drumbeating in the media proclaiming that “your house will make you a millionaire!”, what will it look like in those markets when things tighten up?
I wouldn’t count on it. Just because appreciation wasn’t explosive, doesn’t necessarily mean refis & HELOCs haven’t been. As soon as rates make deeds revert in alarming numbers, you’ll be seeing a staggering supply of 20%-30% reductions that you can attribute to lender sales… perhaps not the 50% in CA but don’t kid yourself…
OT
OCRealEstateFinder.com is now showing 8600 homes for sale, 48 hours ago it was well over 17,000. Mistake or are we looking at the begining of flat out lies and manipulation??
Normally I’m not one for conspiracy theories, but……….
What the heck,
I sent them an e-mail asking “whats up?”.
Will advise if I get a response.
Not holding my breath.
Noticed that too. It seems that they are switching servers etc. If you look at the listings…it seems that their search fxn in different now and none have photos. Plus, your boy lasners blog is having trouble posting comments.
I am suspicious.
A newspapers only product is stuff to read.
How could a server upgrade on one of its core products take over a week?
Either IT is incompetent at the OCR or something more nefarious.
http://www.bubbles.org/html/questions/pop.htm
Kinky photos!
Some people are still looking to join the RE party, but I sure hope they remember to turn out the lights when they leave. Here’s a ‘newbie’ investor writing, on the SDCIA forum:
Wow - they want the money that quickly?!? These properties must be HOT!!
The Bubble has burst! Long live the Bubble!!
What rock is that idiot living under???
I’m actually most surprised by this comment:
“… indoor sport fishing.”
Is that what they do these days to make the desert desirable?
The big ones up in the Arizona desert. I think it is known as the Grand Canyon, as that is where his money would fall into.
OT but worthy: “Posted on Fri, Mar. 24, 2006
County median home price reaches $604,000
San Luis Obispo County’s median home price inched past the $600,000 mark last month, reaching $604,170, according to data released by the California Association of Realtors. This was a 2 percent gain from January and a 21.7 percent gain from February 2005, when the median price was $496,430.
February’s median was still lower than the record set in November 2005 of $605,160.
The county saw an 8.1 percent increase in the number of sales of single-family detached homes compared with February of last year. During the same period, the median price of an existing home statewide increased 13.7 percent as the number of sales decreased 15.5 percent.
“As expected, year-over-year sales continued to decline from the robust levels of a year ago,” said Vince Malta, association president.
Statewide, there is an unsold inventory estimated at 6.7 months. In San Luis Obispo County, unsold inventory was 7.6 months in February. That compares with 5.6 months in February 2005.
The California Association of Realtors bases its figures and projections on the reported closed escrow sales of single-family detached homes (no condominiums) provided by member associations.
— Jeanne Kinney”
OT, on the mortgage fraud problem, things that make you go “hmmmmmm”…
http://tinyurl.com/nocqf
Homeland Security Employee Nabbed at Closing Table
Blah blah blah, mortgage fraud, blah blah blah, inflating income figures, blah blah blah, walk away from closing with $800K…
But this little tidbit caught my eye:
“The complaint further alleges that the $3.3 million purchase price was fraudulently inflated so that the borrower and his coconspirators could walk away from closing with about $800,000, plus the return of the required $842,000 down payment.”
Uuuuhhhhhh, tell me that if this hadn’t been a sting operation, that SouthStar Funding and CitiHome Equity wouldn’t have let this deal go through, right? Their appraiser would have warned them that the house wasn’t worth this inflated price, right? Right?
There ain’t no way in hell they are going to catch all the fraud, it goes up to the highest reaches of the financial/corporate/government system/empire. They are bankrupting the whole country so they can give the corporations a few hundred billion. They are bankrupting FNM, etc. so the CEO can make a few hundred million bonuses off the front end of worthless loans that will never be paid back. It would have been cheaper for the taxpayer to just bribe them straight out of the treasury, instead they waste trillions to try to cover their tracks. The world financial system is screwed, the faster you accept it, the sooner you can find peace with it.
I agree with you, Mort. These guys are the small fish and the fraud they’re committing is nothing compared to the “blind eye” fraud being perpetrated by tens of thousands of lenders, appraisers, and real estate agents every day. It’s gotten so bad that the system now depends on the continuation of fraudulent lending in order to sustain itself. Bankers practically encourage lenders to lie to them on their loan apps. It’s insane.
just remember the BBC documentary from a few days ago: this whole industry has fraud written all over it and the banks know exactly what is going on; they just keep quiet because they make huge profits from the fraud and pass the losses to the taxpayer.
And not just in the US, it’s all over the anglosaxon world. Enron will appear kid’s stuff when we add up all the fraudulent deals in the RE market.
Interesting that the article says Atlanta is a hotbed of fraud activity, which I admit to being a little surprised at. I was under the impression that housing in Atlanta is still relatively affordable, but I haven’t been watching it closely.
I also don’t see how sting operations like this are going to slow down fraud very much. They need to go after fraud they themselves did not create. The article also didn’t address how much the appraiser, broker, etc., may be complicit in the fraud.
Robert Shiller is on ABC Niteline tonight.
Cheers.
Normally, I talk a lot.
I saw the ABC News Nightline show tonight with Mr. Schiller.
We’re here. We’ve arrived.
His interview led the program.
He made sense…
…and it’s just a matter of time.
Don’t expect major price decreases until the End of August.
Come September…
ALL HELL BREAKS LOOSE.
My neighbor just had a house deal fall thru in Salt Lake City Utah because…my jaw dropped…*it didn’t appraise*!
I didn’t think that happened anywhere anymore, and I didn’t think it could happen in a less-bubbly place like Utah. I think it just shows how nuts things are everywhere as this craziness draws to a close…they could have come up with thousands extra to make it “work” but I was so happy to hear they just let it go…if something doesn’t appraise, do people really ever pay the difference to make the deal go thru?! Why would anyone want to do that?!
Things are still so annoying in Ann Arbor…the “spring market” makes sellers brazenly put their houses out for ridiculous prices, to see what fools they can catch. The realtors know that some potential buyers get how silly the asking price is, and sometimes let their clients know it. The stuff that’s been sitting around a while still sits, with tiny price reductions, and the new crop is so overpriced that it’s gotta make potential buyers stay away in droves. Haven’t checked out the openhouse traffic in a while, maybe I should have a look at that “spring market”! It’s very annoying to feel that you will be thought of as making a ‘lowball’ offer if you offer 20% off asking when asking is 25% above anything reasonable pricewise. Usually the stuff that’s not outrageously priced is still overpriced and less desirable properties than the ones with sellers believing they can get anything they ask for it. So, my feel for here in Ann Arbor is that things are still so distorted it’s hard to want to play the house-buying game at all.
cheers!
I have many family members who live in UT. My sister-in-law and her husband upgraded to a large home last year at a rather steep premium. Although my mother-in-law avoids stepping on her childrens’ toes by offering them unsolicited financial advice, she later let slip to her son-in-law that her daughter had overpaid by $30K (and my mother-in-law’s opinions on matters of practical import are above question!).
P.S. The bubble effect on prices shows up strongly in the Utah data. For many years there was a predictable seasonal lull in prices over the Christmas holiday season (Christmas being a biggie in Utah), but suddenly in recent years, the Christmas lull was replaced by a steadily rising trend…
A lowball offer is only in the eye of the beholder. Don’t offer a penny more than “you” (the buyer) think that it is (and will be in the future) worth. If it isn’t accepted, then so be it. Be patient, make offers, and when someone needs to sell, they will accept it.
If someone is trying to flip in SLC. Glad they cancelled. I grew up there, and out of state people are likely to get killed. It is a fickle market there. It can change quickly, and often goes counter cyclical to other places. I started paying attention to prices in the 70s in high school days.
With no building restrictions to speak of, Utah’s supply of new homes can quickly adjust to quell any temporary spike in the prices. Good luck, CA investors!
I been seeing one street in Vegas with no less than 18, yes 18 for sale signs on one road. It’s in an adult only community where on every block there were for sale signs, but 18 on one street/\.
It’s official…Vegas is bursting.
Simmssays…
AmericanInventorSpot.com
Digital photos, please
Just saw CBS Primetime Investigates. Had a story about a Nick Martinez and PrincessProperties.biz that was supposed to be helping people in foreclosure, and also guaranteeing investors an 18% investment return within 3 months. He was selling the foreclosure houses to his investors, and most didn’t get paid, and people were losing their homes. They also said this scam artist is a convicted sex offender on the Megan’s list (child). Princess Properties is now closed, and thousands of Bay area homes in foreclosure and trying to sue this company and crook. The guy has reopened under a new name and same business in the LA area. All people beware.
Another story about homes flooding in the East Bay Contra Costa county. The county filled a ditch to protect a road. People are getting flooded every time it rains.
The county is telling the owners that it is private property and they have to pay for it. Wow. The county passing the buck. Upset homeowners. More to come?
It’s been nice to watch March Madness and forget about the housing bubble. There’s definitely more to life than analyzing foreign trade deficit, inverted yield curve and rising inventory.
How about those wins by UCLA, Villanova, Connecticut and Texas? Doesn’t get any better than that.
Sorry about those investments, but good luck to your team in the March Madness!
Zillow is much lower than the reduced price. HOA + prop tax = $750. Add another $500 and you could rent a similiar property. OR, get a huge mortgage. Which would you prefer.
http://www.craigslist.org/pen/rfs/145021899.html
$550000 - Open SUN 1-4:30pm! Bright End Unit! Remodeled 3BR* EZ 101/92! (san mateo)
Reply to: helenpchou@yahoo.com
Date: 2006-03-24, 8:16PM PST
OPEN SUN! Gr8 Remodel!3BR TH, 2 sty End Unit!View of Park, greenbelt…! Across of Lakeshore Park, near Foster City, Beautifully Remodeled 3BR townhome, Bright & Airy, 2 story Townhome, corner views * EZ access 101/92/shopping
******* Open house Sun (March 26th) 1:00 pm to 4:30 pm ********
******* Add: 1537-A Marina Ct., San Mateo, Ca. 94403 *******
http://www.mlslistings.com/common/properties/propertyDetail.asp?open=0&page=1&mls_number=608471&type=property&name=
MLS: 608471
address : 1537A Marina Court San Mateo, CA 94403
Perfect starter home for first time home buyer or small family!
***** Cross St: S. Norfolk/Hillsdale Blvd., *********
· Beautiful upgraded Marina Garden unique corner unit
· Best location, Lagoon, Lakeshore Park & greenbelt views from windows!
· Bright and airy
. Tile entry
· 3 Bedrooms upstairs
· Gorgeously remodeled eat-in-kitchen and breakfast bar with Verde Negro granite counter slabs, maple color cabinets with glass doors, custom designed tile work on floors and wall surrounds, all newer appliances
. Hardwood floors under upstairs carpets
· Refrigerator stays; pots & pans hook and rack stays
· 1 updated full bath with slate floors and shower surrounds
· Inside laundry room, washer and dryer stay
· All customs crown moldings throughout, customs window coverings stay
· Newer plumbing in kitchen and bath
· Forced air heating
· Living area approx. 1045 square feet per HOA, buyer to verify
· Large fenced front patio
· Easy freeway access 101 & 92 and shopping conveniences
· Association fee $324, pays for water, GAS, garbage, fire insurance, pools, exterior maintenance and landscaping…etc.
· EZ street parking in front of unit and 1 Car detached carport Parking No. 7
Motivated seller says let’s reduce the price from $585,000 to $550,000, we want to sell and move up now!
Century 21 Creative Realty 20560 Valley Green Dr.,Cupertino,Ca.95014 For more info, please contact: Helen Chou Cell (408) 828-8688
Office:(408)446-2664 or 973-1888
Data deemed reliable but not guaranteed, buyer to obtain independent verification.
Marina Ct. at HillsdaleBlvd/S. Norfolk google map yahoo map
* no — it’s NOT ok to contact this poster with services or other commercial interests
1537 Marina Ct #A, San Mateo, CA 94403
ZESTIMATE™: $513,909 (What’s this?)
Value Range: $447,101 - $560,161
Sale History 11/26/2003: $399,000
2005 Tax Information 2005 Property Tax $4,747
Total assessed value: = $406,865
Assessed value bldgs: $284,806
Assessed value land: + $122,059
This is from the article Ben linked to at the very beginning of his post.
Until I read this it never occurred to me that some people thought the “value” of their house was real money before they sold it! And if they didn’t take out that money with a home equity loan, if prices dropped the money disappeared! I’m flabbergasted that any adult who was able to actually buy a house could be so naive. What percent of homeowners think this way? Could this explain some of the irrational behavior?
You see irrational behavior; I see what the former Fed chief saw — the household consumption response to rising stock market and housing market wealth known as the “wealth effect.” Why do you say it is irrational? Of course, as AG forewarned way back in January 2000, money trees tend to have a limited productive life time…
“Thus, the impetus to spending from the wealth effect by its very nature clearly cannot persist indefinitely. In part, it adds to the demand for goods and services before the corresponding increase in output fully materializes. It is, in effect, increased purchasing from future income, financed currently by greater borrowing or reduced accumulation of assets.”
Excerpt from Remarks by Chairman Alan Greenspan
Technology and the economy
Before the Economic Club of New York, New York, New York
January 13, 2000
P.S. “So Long to the Wealth Effect?
Whatever the root causes of the immense gains from real estate and the stock market, the result has been a marathon shopping orgy.”
By Robert J. Samuelson
Newsweek, Oct. 17, 2005
http://www.msnbc.msn.com/id/9634477/site/newsweek/
i live in sarasota and this appraisal scam is slamming on the brakes as far as commercial financing is concerned. I know some individuals who bought 3 lots complete with 2br/1bth crack houses on them for 1.6mm last june.they are paying property taxes,interest on mortgage and get no income. carry costs and leverage get ugly in a hurry when the music stops and the banks aren’t giving out appraisals on the come anymore..maybe greed isn’t so good after all.
OT, but ziprealty inventory for greater SD shows 137 homes with a listing date of 3/24/06. It looks like the pace of new listings is really picking up for the red-hot spring sales season! (Too bad there does not appear to be an equally fast increase in the number of buyers…)
Could someone familar with Ft. Myers, FL tell me why this is so cheap? I think it’s a very cool place. Is the neighborhood bad?
http://fortmyers.craigslist.org/rfs/144884968.html
Disintermediation and other banking challenges:
http://www.xanga.com/russwinter
Ahhh Phoenix, for sale signs stretching over the horizon. Just ran some numbers for weeks inventory for resale. In a couple of the really hot areas–lots of new construction, etc, it’s now coming in at a whopping 45~55 weeks of resale inventory. Oh, Mabel, don’t you hate that part where your stomach floats up into your throat?
“Could someone familar with Ft. Myers, FL tell me why this is so cheap”
Hey txchick, I have not been to Fort Myers in a few years but I used to go there every month for business. This home is in the downton area which is pretty much a rathole. They have been trying to revitalize downtown Ft. Myers for 20 years but it has remained a ghost town at night. In addition Ft. Myers in a very blue collar, low income, redneck area. Even though it is only 30 miles north on Naples, it might as well be 1000 miles away in demographics. I have always thought that long term Ft. Myers would become a nicer more vibrant place as it becomes developed and this is happening so long term this might be a decent investment but definately “long term”.
FWIW, I just did a ziprealty search for SD. At 8:45am on 3/25 they had 2852 single family homes listed in metro SD (not the whole county) and of those, 937 were listed as “reduced.” That’s 32.85% of the listings.
As SD renters who are about to come into a moderate inheritance, this has got to be good news.
-Lili