Local Market Observations!
What do you see in your local housing market this weekend? Economic indicators? “The housing market took a big hit in September: Oregon residential permits plummeted to their lowest level since September 2000, said Tim Duy, economist and the author’s index.”
Subprime related problems? “Indianapolis-based Indiana Children’s Wish Fund has been caught in the national subprime mortgage lending crisis.”
“The small not-for-profit, which grants wishes to terminally ill children, filed an arbitration claim after an investment it had in an intermediate-bond fund lost about $50,000 between late June and late September on an initial investment of $222,812. The bond fund had more than half its assets in mortgage-related investments as of mid-year, according to the filing.”
Online posters? “A slumping stock market, sky-rocketing gas prices, an expected increase in energy costs, and home foreclosures, make up a full economic plate for many Valley residents.”
“In online discussions people post comments such as, ‘Smaller stores are down 20, 30, 40%. This is going to get very ugly. Less Tax $$$$ for Arizona which is already in big trouble.’”
Indication of defaults? “The phone is buzzing for brokers who specialize in selling foreclosed properties, and that’s attracting dozens of new agents into that small but growing segment of the market.”
“Craig Murphy, co-owner of one of the biggest foreclosure specialists in the metro area, estimates that there are 30 to 35 agents in the Twin Cities that have more than 20 active listings of foreclosed properties.”
“A year ago there were only four or five firms with that many, he said. Epic has about 180 listings today, six times the number it had a year ago.”
“Based on the amount of adjustable-rate mortgages issued a few years ago, Murphy thinks the foreclosure activity is at the start of a busy three- to five-year run. ‘Short of government intervention and the lenders stepping up to the plate, or a miracle from God, we’re going to be inundated [with more foreclosures],’ he said.”
I’ve been doing more running than cycling these few weeks so I’m not covering as much territory here in Olympia, Washington, but I have noticed more and more FSBO’s signs versus RE agency signs. Inventory is still piling up. Back in 2004/2005, I would ride/run by a house with a “For Sale” sign one day and literally a few days later there would be a U-Haul in front with the new “owners” moving in. Now, as Borat would say, “Not so much.” Craigslist postings reveal that now might be a good time to sign a long-term lease for a 3 bed/2 ba type SFH because there are a veritable bounty of them on the market and I am confident more are on the way. Well, so long as your “landlord” isn’t an underwater FB facing a foreclosure.
Oh yeah: The D.R. Whoreton development on Mud Bay Road (yes, it’s really only two feet deep at high tide) looks to be slowing down, but utilities are in and there are a few live bodies walking around in hardhats, so who knows.
“… I have noticed more FSBO’s signs versus RE agency signs.”
Recent posts here have suggested realtors “qualify” sellers, meaning accept listings of only those sellers who are willing to budge significantly on their asking prices. Realtors don’t want to waste a lot of time and money trying to dump properties of sellers who are pricing their house as if it’s still 2005.
These FSBO signs probably belong to those people.
Agree; I am avoiding FSBOs -generally, FSBOs are asking way too much.
~Misstrial
Hmmm…interesting. One, that you avoid FSBO’s, and two, that you think they are asking too much. Are these FSBO’s that you refer to on the mls? Is the price on the sign in the yard? Just wondering where you are finding the information. If/when I sell my place, I think I would try FSBO, but I would make sure I was the best priced listing in the area.
The concept of FSBO sort of implies that you don’t want to pay a realtor fee. So right off the bat, you can probably assume that someone selling FSBO is looking to collect every last nickel they can.
I use a good Realtor most of the time when selling my houses, because I’ve found nothing to compete with the ease and speed of a good Realtor. However, I’ve had success selling FSBO, but I do it differently. I put the SQ foot/Price/Price per square foot on the info sheet. I do this because I cut the price by the 6 percent margin I would have cut to a Realtor. This makes me more competitive on price, but I don’t negotiate on these properties at all. It’s a win/win in my opinion.
Also I do put an info sheet taped to the door, and a description of the property on the answering machine. I don’t know how many idiot FSBO’ers don’t answer their phone, or reply to questions left on their answering machines. If your hiding the price that much then the price is a poor one, and not worth pursuing.
“The concept of FSBO sort of implies that you don’t want to pay a realtor fee. So right off the bat, you can probably assume that someone selling FSBO is looking to collect every last nickel they can.”
I disagree. As vmlinux described above, cutting out the realtor fees allows a seller to list the home at a lesser price, which should generate more interest. In fact, I’d argue that those who hire a realtor are trying to gouge every last penny out of the buyer, with the help of that realtor who is paid a percentage of the sale price. Also, every realtor I have ever talked to has stated that FSBO’s typically sell for less $ per square foot. How they have determined that, or if it’s even true, I have no idea.
Land prices are so hideously bloated here in Western WA, that they have to collapse at some point. The amount of money the builders/developers paid for raw land is mind numbing. Farmland which used to sell for less than $5k per acre is running at $50k+ per acre. It’s absolutely absurd. I’m about 30 miles outside of Olympia, and noway, nohow can people afford these prices for dirt (which is built into the home price). Furthermore, people don’t want to live on a 3000 square foot lot (which is what you get when builders chintz on lot size in an effort to recoup their investment), especially when there is nothing but miles and miles of vacant land for as far as the eye can see. Developers, you blew it.
Hi Bantering Bear,
Where exactly outside Olympia. I used to live in the Allyn/Belfair area, also was stationed at Ft. Lewis.
Hi SFBG,
I live in rural Chehalis. I’m familiar with Allyn/Belfair. In fact, the bubble is enormous there as well, and there are NO JOBS.
“Short of government intervention and the lenders stepping up to the plate, or a miracle from God,”
A miracle from God, indeed, just as we need a miracle from God to end the drought in North Carolina.
Note to MSM, Federal, State and local authorities - the next area of massive fraud will be in the foreclosure area. Get out in front of this right now, don’t wait until 2 years from now - close the barn door right now!
I love your sense of humor, crispy
“Based on the amount of adjustable-rate mortgages issued a few years ago, Murphy thinks the foreclosure activity is at the start of a busy three- to five-year run. ‘Short of government intervention and the lenders stepping up to the plate, or a miracle from God, we’re going to be inundated [with more foreclosures],’ he said.”
__________________________________________________________
The fraudsters are going to work harder in this area than during the runup - they have nothing to lose and everything to gain - eating Top Ramen all day sucks!
Crispy, you called the play for today. It sure seems like the fraudsters are buying homes and still getting 130% financing today, with lenders like WAMU. The “sale” shows 5-10% for a downpayment, supported by “sale pending” comps on other fraud houses. The reality is the loan probably provides plenty of cash back to the straw buyer. Then three months later, after a first payment default, they Realtor advertises the $850,000 property for short sale at $525,000. Here is one to see:
metrolistmls.com Plug in listing number 70110106 . This house “sold” in late summer to Keith Crowell. The seller seems to be part of a Century 21 group of speculators, who went “pending” on 3 other houses the same month they sold this one. Now those three $900,000 “pendings” are erased and the Century 21 office has them listed for $600,000. It seems fishy.
This is the third house in the same neighborhood where Mr. Crowell has taken title. The other two houses are 1323 Hillwood (70110099) and 1329 Hillwood (70110102). The lenders are New Century and First Franklin. Keller Williams has all three listed as short sales.
It appears these properties have provided about $100,000 per house to Mr. Crowell. Hmm, not a bad way to make a “living”. WAMU pays the price along with the buyers of the RMBS sold by the other two lenders.
The FBI & IRS made some house calls in the neighborhood a couple of weeks ago, so the jig may finally be up. The only problem is all the wrecked lives from the idiot buyers who competed with this insanity, plus the meltdown of WAMU and Wall Street. The insanity will end soon and people like Mr. Crowell will be paying a price, along with a new room in a high security gated community, again at public expense.
Comment by Rich
2007-11-09 19:20:45
ICEBERG DEAD AHEAD !!!!!!!!!!!
Mandatory Emergency Meeting for San Diego HBBloggers.
Sunday around 1 or 2
Encinitas exit to Moonlight parking lot.
Look for Hwy’s Red Kite.
Hwy50 will be the M.C.
sunsetbeachguy
SDGreg
Carlsbad Renter
PB
Jim
ETC!
So bummed we’re going to be out of town.
Hope y’all have fun this weekend!!!
Friend from the office has a contract on her house on the eastern shore of Maryland. Expecting to close in January. Financing is in place and the buyers don’t have to sell anything to close.
They are making about 10% (before considering money/effort spent on improvements and realtor’s cut) and owned for almost exactly 2 years. Taking the realtor and improvements into account, I think they are about even, though it certainly ate up a lot of their time.
She considers herself supremely lucky to be out of it, even though the ARM doesn’t reset for another 6 years.
This wasn’t so much an “everyone makes money in real estate” couple as a “we are young and married and have jobs and want a big dog, I guess it is time to get a house” couple. I am very happy for them and hope it closes.
Just curious, if financing’s in place and not contingent on buyer’s selling a house, why is the closing being held off ’til January??
A guess: don’t want to move until after the holidays, possibly on the buyers part. Mortgage companies seem to be getting more skiddish about allowing short term renting as well. When we sold, we wanted to close much earlier than the buyers - but as sellers we didn’t have that choice.
Not sure, but it works for her since she has a lot of vacation coming up at the end of the year. Also the guy half of the couple buying just got back from a long stint in Iraq. He may be processing out of the military.
Oh, and they were offered quite a bit more than this offer just a few months after they bought, so this is a reduction. I guess the worst of the craziness just hit their location a little later.
Maryland/NoVA/DC is going to take a while. We have a very bad case of “its different here” in any location that is within a 2 hour drive of DC.
“Indianapolis-based Indiana Children’s Wish Fund has been caught in the national subprime mortgage lending crisis.”
Ahhh, capitalism at it’s finest — stealing from widows and orphans!
Actually, there is a big potential for tax fraud in deals with charities. Think - land value has gone way down, donate to charity, take deduction for the original price or something close to it, take a deduction that might be more valuable than the price the land would now fetch.
This scam is as old as the hills. Substitute any asset that doesn’t have an obvious market value for the land and it has been used in this type of deal. Rights to royalties, closely held stock, you name it.
Gambling by supposedly conservative trusts and foundations will be revealed to be typical, imo.
Every two-bit treasurer with a few thousand sitting in a safe or bank account wonders.. why not ‘invest’ it?
–
Crooks believe in no discremination policy.
Jas
From 10/30/2007 to 11/6/2007, there were 3 homes sold in ZIP code 90274 for an average price of $1,796,000.
1) $1,450,000 on Palos Verdes W Dr
2) $1,550,000 on Valmonte Plz
3) $2,388,000 on Via Solano
sales are still happening here in 90274 which you can see from Pilot side of plane justs before you land coming in from East to LAX. That big hill.
Are you saying that someone is paying over a million bucks for homes that are under the flight path to LAX???
Naw, the hill is about 15 or so miles south of LAX.
I have signed about 360k worth of jobs for custom cabinets in the beach area including 90274 in the last 4 weeks. Just got a voice mail on a 91k job in Malibu that I will measure next week. I am only one of 4 sales people in our company- so I don’t even know what the others have signed recently.
- Business is very very good.
RE: Just got a voice mail on a 91k job in Malibu
Gotta luv the $100k kitchen cabinet crowd.
I had an appraisal bud who did a new construction appraisal for some alledged “high roller”. The contractor put in $100k worth of custom cabinetry,
which the Mrs.’s decided she didn’t like.
So she ordered them ripped out and replaced.
Needless to say, this was the way the entire project went.
Stuff ripped out,replaced,ripped out again.
Don’t like this don’t like that.
Change orders finally tallied around $500k.
So, when it came time to settle, the bank calls my friend and says, ah, we need another $650k in value. There were some over-runs. You wanna get this over to us this afternoon-we want to close.
Some my bud says to the L/O, “So, WTF I’m suppose to do. Wave my magic wand and make $650k appear because the Queen of Sheba couldn’t make up her mind ?” I’m not changing any number.
Needless to say, that was the last assignment he ever saw from that bank. As I remember Mr. High Roller then filed a complaint with the state standards board which was a PITA.
Funny how I had no compassion watchin’ all of that CA stuff burn.
I’m right next to 90274 in 90277. Everything seems to have slowed down dramatically. Homes that would have sold in days for more than asking 2 years ago now sit unsold for months.
Last week I mentioned a short sale around the corner for me that is listed at $1.5M. It was purchased in May of ‘05 for $1.65M and has been on the market for over 5 months now.
Things are getting a little dicey and the correction is “just getting its legs” as I see it. If you’re financing a $1.5M+ house in this area, you better really like it and be prepared to stay in it for a long time.
Nva 22151
2 foreclosures and 2 short sales in my hood
we are 15% off peak
didn’t see that in 90’s
you can take an express bus to the Pentagon from my street
I’ve been tracking sales in an area of around 300 homes called South Coast Metro (OC Calif, next to South Coast Plaza). There has been a number of sales in the last few months in the $700k to $900k range which were financed with 80/10 loans from Well Fargo, Countrywide and JP Morgan. IMO, most people who have to use 90% financing on an $800k house can’t afford the house in the first place.
We also have 4 or 5 foreclosures in progress all of which were purchased in the past 1 to 2 years.
Yet another “short” sale in Madison, WI.
http://tinyurl.com/yqpgg5
Purchased 2/2003 for $174,900 and now on the market for $220,000.
Part of the builder community with the garage in the back of the house.
Just one block away from another short sale by the same realtor, now reduced in price from $205,000 to $200,000.
http://tinyurl.com/2curtl
According to the link to the NY Times this week, the % of all mortgages in Dane County that are subprime is 13%,
Local MLS statistics for Dane County for September, 2007:
http://tinyurl.com/yrub7d
thought everyone there had a phd—- free standing townhouse
Hi Mad!
We went out Thursday and looked at six homes.
1) 5.15 acres in Ixonia $330. It was a flip, but you couldn’t tell by the pictures. Get this–extensively upgraded kitchen, yeah granite and stainless. At the very least, $30k renovation, and that’s if he did the work himself. Same for the 2.5 ba. The rest of the house looked like a construction warzone. My best guess is they just ran out of money.
2) Lebanon 10ac, wooded with a deerstand
$340k. We really like this one, but it’s a bit dated. We don’t believe there is much room for negotiation, as we highly suspect they’re in over their heads. If it’s available in Feb/Mar we might make a really low offer contingent on inspection.
3) Ashippun $339k 10 acres. Nice place, but no mancave for hubby. The way the lot is situated, it appears nearly impossible to put an outbuilding on.
4) Herman. $339k. 6 ac. Nice home, well maintained. Too many retaining walls for me, as I suspect an inspection would reveal water problems. Lots of privacy.
5) modular crap–we’ll just skip this one.
6) Shields $375 9ac HAUNTED house! Forget everything else–not joking–this baby is haunted. Overwhelming sense of despair. We all felt it! Hubby is usually not as tuned in, and he wanted to get out of there! Dang shame too–original glass knobs, just beautiful.
Oooooohhhh, I’ve always wanted a haunted house!!
I have a thing for the ghost and Mrs.Muir.
LOL perv…LOL
One of my favorite movies. Gene Tierney and Rex Harrison and a young Natalie Wood. “Blast.”
Leigh,
It is my belief that small acreage, everywhere, will be coming way down in price. The spike in land prices is not sustainable and, as Ben pointed out yesterday, the builders will start unloading it at a loss as they are unable to carry it long term. Probably best to wait several years on the homes with small acreage.
I agree, but I’d doubt I can keep my husband locked in the closet that long! I let him out once a week to get some sunshine
where are these towns?
Wisconsin
Madison, pt 2.
This home had been on the market since late April, early May and been relisted at least three times with the previous realtor.
Price range was 224,9000-234,900 (or maybe a bit higher, but no higher than 240,000)
Now just listed with another realtor for 204,900.
http://tinyurl.com/28b9cf
The house across the street sold for 228,000 in July.
Nothing has changed here in Huntington Beach. Lots of for sale signs, very few sold ones. Totally dead.
Also dead in VT. This time of year houses come off the market because the holidays. It’s hard for me to tell if the few houses I was causually tracking with for sale signs came off the market were because they were sold or the season. (They sat all summer.)
So, the couple I know who are trying to do the short sale (paid 250k and listed 175k) got two offers. The first offer was a whopping 100k and the second was 120k.
Ouch! That’s gotta bite. Ya think the bank will go for that much of a reduction?
BayQT~
In Austin, a W Hotel is being constructed with 180 condos. The Hotel broke ground a few months ago, but so far, only 7 condos have deposits on them. SO much for the frenzy for luxury downtown condos.
Pretty soon, Austin will join Mami as a city with a few downtown office buildings and lots of empty condo buildings.
RogerH
Any idea on how this is effecting the property management job market fro supervisors? Been poking around as I moved the family to the area but still working in CA. Work for a great group now and expect to find another b4 moving home.
As imagined, not the best arrangement although it is working well for us. BTW, I like to note I’m allowed back in as I’m originally from Houston.
A builder that I know has a house he had been trying to flip for over a year. I just saw that the same property is now listed for sale as “Corporate Owned”. It’s owned by the Deutsch Bank….
Interesting, they think that they’ll get more money by using this terminology as opposed to Bank Owned! (The house is located in Woodland Hills 91364
“Interesting, they think that they’ll get more money by using this terminology as opposed to Bank Owned”
Bad Feng-shui in the term “Foreclosure” Same vibes as a murder be committed in the house. There might be something to this
I live near a neighborhood of turn-of-the century victorians and early 20th century colonials, many of which have been inhabited for many years by the same family, passed on generation-to-generation. Last week, my wife went out with ten or so ladies from the neighborhood who were perplexed as to why houses weren’t selling. My wife replied that it’s because the houses haven’t been maintained, they need 100s of thousands of dollars worth of work, and everyone thinks their home is worth a million dollars. Surprised, they all became defensive, talking about the “charm” of their old homes and how they don’t build them like they used to. My wife replied, “Yeah, well, you asked why they aren’t selling….”
I was surprised how clueless these folks were, but it occurred to me that it is the buyers who are on the cutting edge of what the market is doing; owners don’t really pay all that much attention until they put their house on the market. Then it is a big shock to them.
owners don’t really pay all that much attention until they put their house on the market.
So true…even though I was working in the REIC during the height of the boom, it wasn’t real to me until I put my own house up for sale. I was just thinking about that today. I had three realtors come into my house to give me market value. The one who was most familiar with my area turned out to be the accurate one. Thank God I had someone who was able to shoot straight and not indulge any fantasies I may have had about the value of my home. (People off the street were coming up with outlandish figures for what they said my house was worth.)
I owned one of those old charming turkeys many years ago. It looked picture perfect. It should - I spent ummm maybe $100k on the damned thing just keeping it up. Every weekend was a new project and a new experience. I don’t know what kind of wood the back porch was built from but I painted it about 10 times finally gave up and had it resided. It’d take me Sat and Sun to paint and by the time I finished the 1st part where I started needed repainting (no joke).
An add-on room had a flat roof. I learned something from that - NEVER EVER buy a house with a flat roof. I had 3 new roofs put on it but it leaked the whole time I owned the place, the last roofer was upfront about it said his product would last 2 years, the leaks would start up again. They did.
The house was sort of on a hill, one day the door fell off from its 100 year old hinges, hit the patio, rolled down the drive and shattered. Replacing it was the most incredible experience and so was the cost.
Heating was problematic, usually it worked but one never knew for sure. No central a/c for this baby only window units and they had to be smaller versions to fit in the 1 foot wide windows (ah, they were a bit larger than that but …). The heating and cooling bills were just out of sight sometimes more than $1000 per month (big house).
The worst thing was the house was on the historical register which meant the exterior had to TOTALLY confirm to some old 19th century pictures they had. Else you lost the designation which was the only thing that made it possible to unload this historical beauty on the next sucker.
My wife (who loved the place) and I were very, very glad to sell Ol’ Moneypit at the end and move to a modern house. To me central heat/cooling and vacum still seems like a miracle after that place.
ATLANTA
Earlier in the week I saw Ben’s post about foreclosures in Atlanta, but didn’t have time to comment. There were 6800 foreclosures last month in the metro area. This is about 0.8% of the total owned housing stock. It also means that about 23,800 men, women, and children were impacted by foreclosure last month. If the foreclosure rate stays the same for the next 12 months, a little over 10 % of owned housing stock in the area will be foreclosed on, while close to 250,000 people will be impacted. 250,000 people translates to a medium sized city.
There is still no resolution in sight for the water woes. Our stellar governor is calling on everyone to pray for rain next Tuesday. (Not a joke.) I guess that’s easier than admitting the truth. We have too many people for our limited water resources. The drought is merely acerbating this fact. Twenty years ago, there was a drought wherein area lake levels were actually lower than they are now. But it was no big deal, since we had about 2.5 million less people. And a lot more trees. In the last ten years, we have been constantly subjected to watering restrictions, regardless of the amount of rain we received. In metro Atlanta, expanding the local tax base is much more important than quality of life and proper resource management.
At least they are still watering the artificial turf for field hockey. Gotta have your priorities…
http://media.www.dukechronicle.com/media/storage/paper884/news/2007/10/23/Columns/Apocalypse.Now-3050137.shtml
Citizens will have years to chew over the events of the crash.. all the facts will come out… including the fact that greedy local governments allowed it to happen by permitting overbuilding and unsupported expansion, just for the sake of increasing tax revenues. Such will become common knowledge..
Imagine the Anasazi Indians, just 1,000 miles west of Atlanta, around 850 years ago, when their leaders had them devote all their energy to appeasing the gods, to bring back rain, in the middle of a horrible drought…
And the gods didn’t come through.
It is always dead this time of year in Pullman, WA. The difference is that this year we have almost 90 listings, whereas in the past few years you would only see a dozen homes on the market this time of year.
We also have 100+ lots, roughly 5 years of absorption, and NOTHING is selling in that market. I got a laugh this week when a development that has totally tank just raised their lot prices from mid-40k to mid-50k range. This is after LOWERING the price from 50k to mid-40k range in late summer!
Bozeman is still in denial. Although every person in real estate I know is quietly saying the market is down, most of the public dosn’t know it yet. Most real estate people I know think the slowdown is temporary, just a “hick-up”. Also the local bank are flush with deposits, so any bad loan they have had have not been a problem yet. An example is that devolpment on South 19th that had failed, It was taken over by the bank. Now the bank is playing land develolper.
Bozeman folks think that by denying the problem it will go away. Instead they are just digging a deeper and deeper hole that will take longer and longer to climb out of.
My hunch is that the big wakeup call will come when building slows down enough to seriously impact state revenues. Nothing quite like a serious MSU budget cut to get folks’ attention.
I just met an old colleague at a meeting this past week and he is convinced that the “slow down” won’t impact him since he has a few acres of land with his house. He went on to say that he has no retirement savings other than his house, is in his 50’s and doesn’t know what he would do if it lost value.
Upside down in Laguna Beach:
925 Park Avenue
Bought: 6/20/2005 for $1,250,000
Listed: 2/10/2007 for $1,375,000
Reduced: 3/17/2007 to $1,299,999
Reduced: 8/25/2007 to $1,199,999
31612 Summit Road (REO)
Bought: 8/2/2007 for $759,097
Listed: 9/1/2007 for $889,900
Reduced: 10/2/2007 to $869,900
31662 Fairview Road
Bought: 5/12/2005 for $1,095,000
Listed: 10/8/2007 for $1,059,000
Reduced: 11/2/2007 for $1,037,000
Still crazy pricing disparities. One decent, unremarkable building in downtown DC, I’m considering for pied de terre. Jr one bedrooms priced from $190K - $279K. Same floor plan and square footage. The higher priced unit does not have as nice of a view ! Actually just faces another wing of the building. The wing is not close, it’s not as if there’s only 10 feet between you and the neighbor (interior courtyard is about 70 feet square and there is plenty of light) but still no real veiw. There is a remodeled kitchen. How much does it cost to remodel a pullman kitchen ? I would pay $150K for this floor plan.
These apartements have been for sale for months, at least the $270 ish ones. The $190K seems like more recent listing vintage.
NOTE: This is not a new building but well run coop.
Denial in the center of New York City.
Even with declines and foreclosures across the country, in the suburbs, in New York City boroughs such as Staten Island and Queens, and even Eastern Brooklyn, people are saying Manhattan and Brownstone areas of Brooklyn are places where prices will fall very little if at all.
From the New York Times:
“ALTHOUGH there are many questions about the direction of the Manhattan real estate market, the evidence to date shows that the market remained strong last month, continuing right through the last closings.”
http://www.nytimes.com/2007/11/11/realestate/11deal1.html?ref=realestate
The part of Brooklyn I live in is the second to last domino. Manhattan is the last. We’ll have capitulation when it falls.
i first falsely called a top of the manhattan bubble in spring 2004… then 2005. but i didn’t anticipate the plummeting dollar. maybe the only thing that will put a serious dent in manhattan prices will be an outright bloodbath on wall street…….
Well, I saw my first sign twirlers today. We were driving through Apex, NC and there were two high school guys standing on the corner flipping and twirling signs for some Lennar townhouses nearby. We’ve seen a ton more “for sale” and “for rent” signs here in the last month. Every week, we seem to see more.
There’s one development of $500k houses that seems to be relying on some helium balloons to attract attention. For houses that expensive, they ought to at least use fancier balloons! (Or maybe offer free gold bullion with the purchase of any house.)
Redfin Listing Stats for 92627, redfin.com, SFR, zoom in once after search.
424 properties
Avg List price $895,000
3.4 Bdrm, 2.4 Bth, 1,988 sq/ft, $/sqft $579, AVG DOM 89
An article on living in Easton, Connecticut appearing in today’s on-line
New York Times includes this phrase, “…prices in Easton are holding their own…” Wondering if this was so, I visited the website of a major New England realty company that now posts price reduction messages next to the photos of the houses so reduced, indicating
by how much the price has been dropped and what percentage of
the previous asking price this drop represents. There were 89 listings
for Easton. Of the first 20 listings alone, 10 were reduced, one by as
much as 16.89%! At least the paper version of the Times can be used
to line the bottom of the birdcage…
I’d like to echo this comment. The NYTimes is seriously shilling for RE…they even have a Friday lifestyle section called Escapes where they promo high-end RE all over the country. It’s pandering to the high end–as they collect listings from all over the country and abroad in the advertising. The NYTimes has been poor in Biz reporting, but their RE articles are a disgrace…they never let the facts get in the way of their advertising stream. They have been behind the curve in reporting on the housing crash at every turn.
I saw my first ever “Price Slashed” today.
I didn’t stop to get a flyer because…well…yawn….
Ok. What next?
http://hosted.ap.org/dynamic/stories/S/SKOREA_TOILET_HOUSE?SITE=TXDAM&TEMPLATE=STRANGEHEADS.html&SECTION=HOME
Chuckles Tx. Thought about posting that link, but thought better of it, for some are offended by…er…toilet humor.
Too Funny!
Leigh
Dublin, CA, 94568 (San Francisco, East Bay, Tri-Valley area)
I haven’t given an account in a while but here goes, beginning with a little background for those not familiar with the area.
Cross Creek Apartments at Amador Valley Blvd near Dougherty Rd. converted to condos in April/May 2005. New name: Village Park. All 56 units are 3/2, 1070 sq ft, no garage, and rented for $1750-1795. The initial selling price was $440k, which quickly rose in increments to $560k. There may have been some that were *bought* for a little more.
I started seeing for-sale signs before all of the units were sold, and most times there were at least 2 or 3 signs posted at the front of the property on Amador Valley Blvd. At one time there were at least 6 signs posted. Several months ago I noticed that one sign seemed to linger much longer than others. Then one day an additional sign was hooked onto the bottom of it: FORECLOSURE.
Since the beginning of 2007 (possibly, the end of 2006), the asking prices started to go down from the high of $560/$570k, to the high $400s ($494k).
Fast forward to now:
FORECLOSURE property
7108 Cross Creek, B - 1070 sq ft, HOA: $285
10/31/2007 389,900 (remember seeing it at $399k)
11/2/2007 370,500
7104 Cross Creek, B - 1070 sq ft, HOA: $285
10/31/2007 399,900
11/2/2007 379,900
True DOM: more than the 40 days posted on ziprealty. A more realistic number would be twice that.
An additional tidbit: Former renters complained about mold issues throughout the property. (www.apartmentratings.com)
Can we say, HUGE losses abound???
BayQT~
We have a townhouse community running a buy one get one free sale here in Colorado Springs
As long predicted here, the housing bubble bust offers a silver lining of improving affordability in San Diego County.
Caution: Try not to catch yerself a falling knife! Just because it is thirty-three percent cheaper does not necessarily mean a low-income household can afford it.
Foreclosed properties help new buyers
Low-income households becoming homeowners
By Emmet Pierce
STAFF WRITER
November 11, 2007
The mortgage market meltdown and the resulting surge in foreclosed homes offered for sale has created welcome home-buying opportunities for San Diego County’s low-and moderate-income households.
http://www.signonsandiego.com/uniontrib/20071111/news_1n11default.html
Since when does a home priced at $305,000 qualify as “low income housing”? Since the median HH income in San Diego county is something like $60K, I am guessing “low income” means under $30K or so. Unless real estate starts inflating again real soon, the nice loan officer at BOA may have just helped this poor family catch a falling knife with a loan at over 10 times their income which they will never be able to repay.
The best deals for first-time buyers are in low-income areas such as City Heights, Bliesner said. On any given day, hundreds of homes in the county are in various stages of foreclosure, he said. “Everything indicates more properties will be on the market in the affordable range.”
Blas Vazquez, 40, a father of four who works the overnight shift at Ralphs in Carmel Mountain Ranch, bought a foreclosed home in City Heights. For years he and his wife, Maria, and their children, ages 9 to 16, have lived in a small apartment nearby.
“We tried to buy a condo for about a year, but we couldn’t afford it because the price was so high,” said Blas Vazquez, who has a second job as a gardener to make ends meet.
Working with Community HousingWorks and Bank of America loan officer Teresita Davis, the Vazquez family last month purchased a small two-bedroom home on 41st Street for $305,000. A year earlier, the house had been offered for $500,000, Davis said.
The lending package that enabled the family to buy the home was a patchwork of fixed-rate loans, grants for low-income buyers and city redevelopment funds. Although the home is less than 900 square feet, it occupies a large lot that gives the Vazquez children plenty of room to play. There’s also a large covered front porch.
Most of the neighboring homes are modest but well-kept. Blas Vazquez said he eventually wants to enlarge the house.
“This is my first house in America,” said Vazquez, who became a U.S. citizen in 2004. “I have a beautiful family. Now I have everything.”
Those who buy foreclosed homes should be careful not to fall into the same traps that led the previous owners to default on their loans. That means not borrowing more than they can afford to repay. Home buyers should be able to sleep at night, Davis said.
The key to securing good financing on a foreclosed home is to get preapproved for a loan and to work with counselors designated by the U.S. Department of Housing and Urban Development, del Rio said. For loans of less than $417,000, which are purchased by government-sponsored Freddie Mac and Fannie Mae, interest rates remain near historical lows.
Making foreclosed properties affordable to low-income households usually requires “a multilayered loan transaction,” said del Rio. “We utilize the California Housing Finance Agency’s first-mortgage product along with a variety of down-payment-assistance programs.”
The average buyer that del Rio’s agency works with has an income in the mid-$30,000s, and the average purchase price is $316,000.
Adelizzi said the current market situation may be short-lived, however. There is no guarantee that interest rates will remain favorable, and “we are not going to see these prices again.”
I totally agree we are not going to see these prices again, at least for fifteen years or so, as prices have a long way to fall before affordability is restored. That is why I don’t understand this well-intentioned effort to put low-income households on track for a high probability of future foreclosure. Is it hard to understand that loans at ten times your household income are only affordable against the backdrop of a housing mania, when prices double every five years or so? Or that the mania ended in 2005, and prices are currently falling in San Diego at an unprecedented rate of decline?
I just wrote to this “reporter” to ask whether this was an article or an advertorial.
Lenders are still getting away with this sheite!? This article profiles the Velazquez family: four children, father is a night worker at Ralphs Grocery/PT gardener.
Article states that these typical low-income buyers in San Diego have incomes around $30k and are buying homes in the $300k range. WTF? How are they still giving out these suicide loans? Based on income, these buyers should qualify to borrow around $90k. People with $300k loans should be earning $100k per year.
I strongly protest a tax-payer funded “Community Housing Works program” in bed with Bank of America giving out suicide loan packages AFTER the bubble has become common knowledge. The ultimate impact of this will end up on the shoulders of taxpayers. The crimes by the lenders and their henchmen in sheeps-clothing continue unabated.
These actions by a supposed charity do exactly the opposite of their stated intention by supporting unaffordable value levels making homes unaffordable. This will only produce a revolving door of foreclosures while fleecing the taxpayer.
Thank you. I am too besides myself with rage at the moment to write as eloquently on this as you have.
Recipe for a politically-engineered housing market bailout:
1) Pass laws to eliminate traditional safeguards against high-risk lending (such as subsidizing interest rates to eliminate the risk premium or eliminating downpayment requirements) in order to make it far easier for low-income households to buy homes that will bankrupt them.
2) When lots of low-income households are facing foreclosure, pass “save our homes” bailout measures to force anyone who did not participate in the mania to pay for the misfortunes of those who did participate.
I am astonished that crazy loans still seem to be avaialble, even as they are wreaking havok
Great News from Chicago!
The bursting bubble seems to be affecting the future of a 55 story tower planned to be built right in my lap and would seriously add to an already awful and dangerous traffic congestion problem here. Check out these excerpts from Crain’s Chicago Business:
Nov. 09, 2007
By Thomas A. Corfman
Beitler’s plan for Edgewater high-rise collapsing
(Crain’s) - A deal between developer J. Paul Beitler and St. Andrew’s Greek Orthodox Chicago to develop a condominium high-rise on a site adjacent to the Edgewater church is falling apart, nine months after the collapse of another transaction with a different developer on the same site.
In August, Mr. Beitler had sought city zoning approval for a 45-story condo tower that would include 288 residential units and parking for 613 cars. The three-acre site is located just south of the church, 5649 N. Sheridan Rd.
“Due to the change in the economic climate, the cost of construction, the demands imposed by the Edgewater community and the parking requirement imposed by the alderman, Beitler Real Estate has requested that they restructure their proposal,”
“Mr. Beitler says that largely because of an impasse over the financing…”
“But he admits the downturn in the condo market and escalating construction costs haven’t helped.”
New Market Trend:
Multi Level Marketing! Everyone getting laid off in the mortgage and real estate industries are going to join Mary Kay, Amway, and the HerbaLife groups. It happened in 1993-95. One of my associates went into selling personal panic alarms. You carried it with you and triggered it if you ever got attacked! I don’t think he ever sold one, but he invested his last $1,000 ordering the sales kit. After a year of breaking rocks, he gave up in 1995 and got a real job.
The quality condo complex I’m watching in N San Jose:
2 “pending” out of 5. One “pending” since 10/30 may have sold, or dropped off. No widespread price reductions recently, but one place listed for $440 in August is still here for $420 now ($450 was the peak listing price).