Reflecting The Overall View With A Wait-And-See Approach
The Dallas Morning News reports from Texas. “The Dallas-Fort Worth area joined the long list of U.S. cities with falling home prices in a new nationwide survey. The D-FW third-quarter decline was worse than the nationwide 2 percent drop in pre-owned home sales prices, the real estate trade group said.”
“Dr. Jim Gaines, an economist with Texas A&M University’s Real Estate Center, said he’s not surprised that the Dallas market is trailing the rest of the state. ‘We’ve acknowledged for some time that the D-FW market has been the weakest of the major Texas metro markets with considerable overhang in the new homes and lately in the existing home inventory of houses for sale,’ Dr. Gaines said.”
“Dallas housing analyst Ted Wilson said he wasn’t overly concerned about the Realtors’ new report. ‘I don’t think we are way out of whack,’ Mr. Wilson said. ‘The expectation is that a lot of this excess inventory will get cleaned up in the spring.’”
The American Statesman from Texas. “Sales of existing homes in Central Texas declined in October for the fifth straight month. Sales of single-family homes were down 15.4 percent compared with October 2006 and were off 6 percent for the year to date, according to the latest figures from the Austin Board of Realtors.”
“September has experienced the steepest monthly decline this year; sales plunged almost 24 percent from a year earlier. And with pending sales down 19 percent in October, November could also see a decline.”
“Though sales are off from a record-breaking 2006, experts say Central Texas’ housing market is still in relatively good shape. But it hasn’t escaped the ripple effects of the national subprime problems.”
“‘I think the (housing) market is reflecting the overall view of the national housing market, with a wait-and-see approach,’ said David Taughinbaugh, a senior VP at Prosperity Bank’s downtown branch. ‘Buyers are on hold right now. They’re waiting to see how the market fares when the buying season resumes after the first of the year.’”
“Cheryl Middleman, owner of Austin Confidential Real Estate Services Inc., sees how the market has shifted. ‘A year ago, I had nothing but buyers, and now I have mostly sellers,’ she said, and most of them are builders trying to sell their new homes.”
“Among her listings is a 1,667-square-foot home in Austin’s Northwest Hills that she, her husband and a contractor remodeled. ‘It’s a phenomenal location, and we get a lot of activity,’ she said of the house.”
“But it’s not selling.”
“The house was listed Oct. 1 for $342,000. Since then, Middleman has dropped the price twice, first to $339,000 and then ‘drastically’ a week ago to $319,000.”
“With few listings in that neighborhood, homes usually sell fast. ‘There are qualified buyers out there. I just don’t think they’re making a move in this market,’ Middleman said.”
The Express News from Texas. “The number of new housing starts dropped 27 percent since last September as builders try to correct the oversupply of new homes on the San Antonio market.”
“And although it’s a painful time in the home building industry, with most builders laying off workers this year, the industry is taking the needed steps to right the market, said Jack Inselmann, vice president of Metrostudy’s U.S. Central Division.”
“‘We still have our work cut out for us with finished inventory,’ Inselmann said.”
“There are currently 2,980 new, vacant homes for sale — good news for house hunters searching for a good deal or discount, though not so great for builders. Builders all year have been trying to shake off an overabundance of homes built in 2006. Many of those homes were started for out-of-state investors who backed out of contracts upon the discovery that San Antonio’s new-home market rarely turns a quick profit for buy-and-flip investors.”
“For the first several months of 2007, builders of entry-level homes were hit the hardest by both the oversupply of homes and problems in the mortgage lending market.”
“But for the first time in the third quarter, the slowdown has started hitting the upper-end market — those homes priced more than $300,000, Inselmann said.”
“The slowing market simply took longer to reach that segment because those homes take longer to build. ‘Those numbers are hitting their peak. It was going to get there eventually,’ Inselmann said. ‘Every segment gets touched.’”
“Along with new homes, the number of vacant, developed lots has climbed to 27,040, the highest level in 10 years. And 10,000 lots were under development at the end of the third quarter, according to Metrostudy.”
“While it takes as little as three to four months to build a home, developing a lot takes about 18 months, developer Norman Dugas said. ‘There’s a lot longer lead time and construction time,’ he said. ‘When the spigot turns off, we can’t stop the lot delivery as quickly. The builders can stop building faster then we can stop developing.’”
The Houston Chronicle from Texas. “Single-family home sales in the Houston area fell 7.9 percent in October from the same period last year, the Houston Association of Realtors reported Tuesday. That’s about half the 16.4 percent decline between September 2006 and 2007.”
“Rob Cook, chairman of the association, noted that the woes in the lending market have helped put potential buyers on the sidelines. ‘The people who would have bought are renting, and some have dropped their price and said, ‘I can’t buy this, so I’ll buy this,’ Cook said.”
“Midrange homes, where most of the sales last month occurred, saw the steepest declines. That’s possibly because of foreclosure activity, said Karen Derr of Karen Derr & Associates Realty.”
“‘It was easier to get a loan in that price range,’ Derr said.”
“Lenders in recent years have been more lax and offered exotic mortgages that often ended up in default, sending the subprime mortgage market into turmoil. ‘Those foreclosures are still hitting the market,’ Derr said.”
“Some of the October statistics show the slowdown will likely continue. The number of pending sales at the end of last month were down 6.6 percent, compared with the same month last year, according to the realty association.”
The Houston Business Journal from Texas. “The Houston real estate market is on pace for its second-best year on record with recent declines in home sales slowing in October.”
“‘The Houston real estate market is likely to experience continued weakness as the residual effects of the mortgage industry credit crunch filter through the system through the end of the year,’ said HAR chairman Rob Cook. ‘If you look at the overall year picture, we’re only modestly behind the absolute record year of 2006 and are ahead of 2005, which was a banner year.’”
The Sun News from New Mexico. “Yes, the real estate market has cooled off in the past year. Yes, all the news about the subprime mortgage mess has sent some shocks through the national economy. And yes, fewer building permits have been issued in Las Cruces as of late.”
“But members of the Las Cruces real estate and business community want buyers and sellers to know that all is not lost. In fact, now is a good time to buy a house, they said.”
“‘We’re in good shape,’ said real estate professional Gary Sandler in Las Cruces. ‘Things are slow, yes, that’s part of the cycle.’”
“Sandler said that, just since August of 2006, the number of homes on the market has jumped significantly. ‘We don’t have enough buyers,’ he said.”
“Michele Marshall, executive director of the Las Cruces Home Builders Association said that the number of building permits has fallen. ‘In September of 2006, there were 144 single family permits in the city,’ she said. ‘Right now, there are 43.’”
“Steve Vierck, president and CEO of the Mesilla Valley Economic Development Alliance, said that whenever the housing market slumps, a wide variety of people are affected.”
“‘If things slow down, we think immediately of construction workers, contractors, real estate agents and others that are directly impacted,’ he said. ‘But it affects a much broader range than those individuals. Think about yourself, if you bought a home and what you buy after you buy a home, if you reduce demand for those goods and services. Think about people who sell furniture and wall paintings and landscaping and title companies and insurance companies.’”
“Marshall said the news from her national organization has been encouraging. ‘They keep telling us that the downturn in the housing market is not having a huge impact yet on the economy,’ she said. ‘Now is a real good time to buy a home.’”
“Sandler said that some people do not realize that loans are available. Some of the more exotic-style loans have been stopped, he said, but home buyers can still get mortgages.”
“‘Media reports are influencing buyers and sellers,’ he said. ‘Buyers and sellers think that mortgage money is scarce. It’s not. Mortgage money for flaky people is scarce. But mortgage money for everybody else is great.’”
‘Though sales are off from a record-breaking 2006, experts say Central Texas’ housing market is still in relatively good shape.’
‘we’re only modestly behind the absolute record year of 2006 and are ahead of 2005, which was a banner year.’
‘There are currently 2,980 new, vacant homes for sale…Many of those homes were started for out-of-state investors who backed out of contracts upon the discovery that San Antonio’s new-home market rarely turns a quick profit for buy-and-flip investors.’
Take that Texas bubble deniers!
And for you folks in New Mexico, here are some quotes from the archives:
‘Do you want to buy a home in Las Cruces? The good news is that there are more homes on the market than in years past. Even though 2006 was another record-setting year for home sales in Las Cruces with more than 2,300 homes sold, the first quarter of 2007 reflects a major step back from that pace.’
‘According to Annette West, a Las Cruces real estate agent, 352 homes have been sold so far this year. Through March of last year, 507 homes had been sold. ‘That’s a big change in volume,’ West said.’
‘Do you want to sell a house in Las Cruces? A couple of years ago, you could have probably had buyers knocking on your door within hours of putting the home on the market. ‘Sometimes, before you could put a sign on, it would sell,’ said Louis Sauceda, owner of the Official Mortgage Team of New Mexico. ‘I was talking to an agent friend of mine and he said they now have to work a little harder to sell them. Fewer homes have sold than a year ago. In May 2006, 236 homes closed, reports Annette West, a Las Cruces real estate agent. Through May 29 of this year, that number dropped to 111.’
‘Real estate agent Barbara Carrison said the fact that homes are taking longer to sell is not caused by a lack of home buyers, but an increase in supply.’
‘It’s taking a little bit longer because there are so many more homes on the market at this point,’ she said. ‘There are not less buyers, but there are more houses.’
‘Fewer homes sold in July than a year ago in Las Cruces. Homes, new and previously owned, are still selling at a decent clip in Las Cruces, but certainly not as fast or in the same numbers as years past. C.J. Pierce of Steinborn Realty…said, there is a lot less room for error in today’s market. Houses will sit ‘if you have the wrong price, in the wrong place in a competitive market.’
‘Stacey Melzer has had her house on the market in Las Cruces for more than six months. ‘I did not think it would take this long (to sell),’ she said. ‘There are a lot of homes on the market giving buyers more to choose from so it’s made it more difficult to commit to a purchase,’ said Las Cruces real estate agent Karen Trujillo.’
‘Real estate agent Annette West reported that 173 homes sold in July. That is off significantly from last year’s pace. West reported that 246 homes sold in July of 2006. West pointed out that the overall average price is down from $212,921 in July 2006 to $199,872.51 in July 2007.’
Here in Las Cruces the number of lots for sale probably exceeds the number of houses for sale and still they’re developing three more. One 4000 lot subdivision that’s in the planning stages is now in litigation because of alleged bribery of a city councilman.
It hasn’t been this bad here since 1974.
“But members of the Las Cruces real estate and business community want buyers and sellers to know that all is not lost”
Nope…just a couple two or three 0’s on the left side of the .dot… listing your hard earned home equity appreciation.
I’ve heard that Texas home prices are held down by the high property tax rate. I’ve also heard the annual tax bill is in the 3% range of appraised value. Is that true state-wide, or can it vary significantly from one county to another?
It does vary by county because of different school districts, etc.
It’s around 2.6% here in Amarillo TX, but we don’t have a state income tax so we bleed in real estate instead of earnings.
How are reassessments handled ??? Every year ??
Every year. Like rest of coutry, people are happy with property taxes lagging when it is going up but not so, when that lag is on way down.
“‘Media reports are influencing buyers and sellers,’ he said. ‘Buyers and sellers think that mortgage money is scarce. It’s not. Mortgage money for flaky people is scarce. But mortgage money for everybody else is great.’”
This is why when friends facing rate resets in the next few years ask me whether it is better to lock in a rate sooner than later, I always tell them I would wait if I were in their position. The credit markets are currently in the process of repricing risk. Absent massive govt intervention to prevent the invisible hand from carrying out this natural winnowing function (a development which is clearly not out of the question), anyone with a good credit rating and secure job is likely to be able to qualify for a lower interest rate one year from now after the widely-predicted slowdown of the U.S. economy.
I am using the Japanese economy circa 1990 as my model; if the Fed instead goes into Volcker early-1980s mode, all bets are off! This possibility is why I am careful to clarify that this is the gamble I would take, rather than to offer unqualified advice for others to play this strategy.
‘friends facing rate resets in the next few years’
PB, I bet you are the life of the party at those get-togethers!
I always keep my mouth shut on housing-related issues these days unless someone asks for my advice…
As much as a Volker action is necessary it would cause a meltdown of the U.S. economy…I think the Fed is going to just try to manage a recession….
That’s my view as well, which is why I suggest to those facing interest rate resets to not be too anxious. The trend is your friend if you are hoping for lower rates.
Just a little off topic, but one thing you hear over and over from realtors and the NAR is that interest rates are at all time lows, or historical lows. That is not true, when my parents bought their current house in 1959/60 their interest rate was 2.9%. Can’t happen again? I have learned in my 51 years on earth to never say never.
They conveniently begin the period of years they use for comparison purposes at some date well past the early 1960s.
There is a major difference. In the 50s, the USD was tied to gold and the government printed far less paper money. Thus, a rate of 2.9% was not that low for a stable dollar.
However, it’s quite different now. The USD is tied to the gold no more and the FED will even reveal its M3 data. I would say the interest rate is really low now, considering the true inflation rate.
Yeah and there was no inflation like today so they were paying a relative high REAL RATE compared to today where inflation is running over 6% and your motrgage is 7% let’s say, then your REAL RATE today is 1%, less than your parents paid in REAL TERMS, not nominal terms.
I don’t see this news as particularly good for would-be buyers (especially first-time buyers), except for those who want to try and catch themselves a falling knife.
However, it may be good news for folks facing ARM resets in the next few years who already own homes they can afford and who have solid credit and secure jobs.
Falling rates on mortgages welcome news
By Jeannine Aversa
ASSOCIATED PRESS
November 22, 2007
WASHINGTON – Mort-gage rates sank this week, with rates on 30-year mortgages dropping to a six-month low, a spot of welcome news to would-be home buyers.
http://www.signonsandiego.com/uniontrib/20071122/news_1b22mortgage.html
Not sure what this guy is talking about, but:
‘The king of Tonga may have been thinking about poor and rural residents of Lubbock having to drive to the strip to buy beer. Or maybe about poor ol’ Texas Tech having to reduce the price on their old president’s home to a mere $775,000.’
‘Boy, do I feel sorry for the surrounding residents in that four-block area after our appraisal district gets wind of that sale. It should put everyone’s house in that area at about $600,000 apiece next year at tax time.’
‘I am thinking the King of Tonga is not too far off in his thinking. Kind of like our mayor praying he’ll get re-elected!’
Maybe he’s talking about the “Jester” fraud pulled on Tonga:
to recover $24m lost through investments promoted by the king’s court jester.
“…The money - which represents 40% of the government’s annual revenue - was managed by an American businessman, Jesse Bogdonoff
http://news.bbc.co.uk/1/hi/world/asia-pacific/2037925.stm
American: Businessman & Financial Innovation…God save the Queen!
Ben…Maybe you can answer my reassessment question posted above ??
King of Tonga no expert on Lubbock, leaders say
Ruler uses city as example of poor, rural area in National Geographic
ROBIN PYLE
AVALANCHE-JOURNAL
The king of Tonga has apparently heard of Lubbock, Texas.
And he mentioned it to a national magazine writer.
In a paragraph on the last page of a recent article in a National Geographic magazine, the Tongan leader cast what some may describe as an undesirable image of the Hub City.
During an interview last fall with the magazine, the then-crown prince of Tonga named Lubbock as an example of poor, rural areas in the United States.
On the Net
• To check out the full text of the article, go to http://www.nationalgeographic.com
The story recently appeared in the magazine’s November issue.
In the article, writer Matthew Teague chronicles his experiences while visiting Tonga, a nation of islands in the South Pacific Ocean with about half the population of Lubbock.
The latter part of the story centers around Teague’s conversation with the crown prince, who has since become king.
He told crown prince Taufa’ahau Tupou V it seemed unfair that the royals and nobles of the nation had great wealth while others in the country had to rely on foreign help.
“Is that unfair criticism?” the reporter asked.
These are the writer’s words about what happened next:
“He dismissed it with a wave of his hand, noting that despite America’s reputation for wealth and power, it also has poor people in inner cities and rural areas. ‘Lubbock, Texas,’ he said, ‘and such places.’”
Though it’s unknown why the king picked Lubbock as his example, 2005 statistics may back up his claim. Lubbock County has a higher-than-average poverty rate.
About 19 percent of Lubbock County residents were at or below the federal poverty line, compared to 16.3 percent of the Texas population and 12.7 percent nationally, according to the U.S. Census Bureau and the South Plains Food Bank.
Even more children are considered to be in poverty - about 25 percent compared to 18.5 percent of the nation’s children in 2005.
Still, some local leaders say the comment in the magazine could portray Lubbock in a poor light to some, though it is unlikely it will do much damage to the city’s image.
“Just that comment shows he doesn’t have an accurate view,” said Marcy Jarrett, executive director of the Lubbock Convention & Visitors Bureau. “Obviously, he hasn’t been here. He hasn’t bothered to find out the good things about Lubbock. I would advise him to come here.”
Mayor David Miller said he questions the credibility of someone speaking of Lubbock who has not been to the city.
“I would say the prince is simply misinformed,” he said. “Lubbock is a great place economically.”
Miller pointed to a low unemployment rate, a good cost of living and a low tax rate.
“We have a lot more things locally to be concerned about than what the king of Tonga has to say,” Miller said.
When Tongans are in the US they prefer the San Francisco Bay Area. There was a diplomatic incident of sorts some time ago when a young hispanic woman racing caused an SUV full of Tongan royals to roll and flip off the road and causing a minor massacre of sorts.
This quote also comes to mind:
“I had a map on my wall that had a circle around Lubbock and then giant arrows pointing toward New York City and Los Angeles. Written across both arrows were the words ‘Toward Civilization.’ Of course, by the time I got to New York, I realized there really isn’t any civilization.”
–Barry Corbin
lmao..:-)
“The credit markets are currently in the process of repricing risk”.
Let’s look at risk vs. reward. Locking in today, you know exactly what your monthly payment will be, and can sleep well tonight vs.
gambling on savings a couple of per centage points if rates go lower or the possibility rates will head much higher Worrying about saving
a percentage point or 2 and the loss of sleep makes me want to be proactive and do something now.
Go ahead and lock in your rate now, and forego the chance to get a lower rate when the economy goes into a recession.
And by the way, HC svcks!
HAPPY THANKSGIVING EVERYONE!
I am thankful that the bubble has finally busted and prices are declining. And look forward to further declines in the coming months and years.
‘Buyers and sellers think that mortgage money is scarce. It’s not. Mortgage money for flaky people is scarce. But mortgage money for everybody else is great.’
Flaky means no savings and a mediocre credit rating…in other words, almost everybody.
lmao…stretches the belly…gobble gobble…no popcorn today Neil…not enough room.
There is no diet on Thanksgiving!
Gobble gobble! We ‘buyers’ have no worries. I can’t say that about the sellers.
Neil
I needed a good laugh today seeing as I’ll be sitting down to eat with some relatives I’ve spent all year avoiding. Especially the husband and wife who were gloating for the past 2 Thanksgivings about the 2 properties they purchased in 2005, using sub-prime, to rent out which are now worth $100,000 less (each) than they paid and, I hear, one of the renters is giving them problems.
This should be fun. NOT. Cannot wait to hear the, “My realtor says the market will pick up in the spring,” comments. To which I will no doubt reply, “Well, good luck. (yawn) That turkey and wine together has made me sleepy. Think I’ll have a nap.” Hopefully, the next thing I hear will be, “Mike, Linda and Rob are leaving now. Come and say good-bye. He has to get up for work.”
Christmas, Thanksgiving and the New Year. Those wonderfully commercial driven times when you run around like a nutcase for a day buying too much food and other crap and then get together for 5 hours with those you have tried to avoid all year.
However, the laugh was concerning the comments from realtorwhores in New Mexico. “All is not lost. Now is a good time to buy.” I LOVE that phrase. It always makes me laugh. In fact, if I drink enough Merlot, I might tell my relatives, “Y’know, Rob. If you were smart, now is a good time to buy more houses. Looks like the bottom is in.” Better not - if I want my wife to speak to me for the rest of the year seeing as Rob is her brother.
Christmas, Thanksgiving and the New Year.
I LOVE this time of year. Then again, I get along well with my extended family. Yes, two years ago they thought I was insane with housing. And a national day to get drunk? Hey, we need that.
Then again, my family is asking me when its good to buy (except for one uncle… who via propertyshark.com I found out is living la vida HELOC.
Ben:
We need a thread tomorrow on Thanksgiving day conversations. My participation might be limited, I lost my voice due to a cold, so for once I’ll be quiet!
Got popcorn?
Neil
“…And a national day to get drunk? Hey, we need that.”
In Cleveland… that “day” is Sept 17…half way to St. Paddys
Amazingly, even those few that aren’t Irish, get in on the act.
If they follow the lead of Wall Street they’ll soon have the holiday “sliced & diced”:
1/4…1/8…1/16…1/32…1/64…1/128…how far do I go until I get to 2 drinks every 30 minutes… year round?
Cheers!
“Though sales are off from a record-breaking 2006, experts say Central Texas’ housing market is still in relatively good shape. But it hasn’t escaped the ripple effects of the national subprime problems.”
Wait, Austin is different! Who in the he!!’s idea was it to put statistics into that story????????
Ben - quit posting and go eat some turkey!
Happy Thanksgiving
Curt
‘Buyers are on hold right now. They’re waiting to see how the market fares when the buying season resumes after the first of the year.’”
Magically the buyers will re-appear as soon as the superbowl completes. Somehow all the unqualified buyers will either suddenly qualify again or the few qualified buyers will suddenly go into a feeding frenzy… Yea…
I think we’ll have interesting news post-superbowl.
And it won’t be about a RE market recovery.
Got popcorn?
Neil
ps
on my blog I updated my real estate emotions.
I’ve heard that Texas home prices are held down by the high property tax rate. I’ve also heard the annual tax bill is in the 3% range of appraised value. Is that true state-wide, or can it vary significantly from one county to another?
For me it’s not nearly that high. I live in suburban Waco (outside the city in the unincorporated town of China Spring). According to the county, my appraised value is $204,281 and my current property taxes are $3754.49 which comes out to a rate of 1.84%. That includes a homestead exemption of $15,000 which knocks the apparent rate down a bit for owner occupied houses.
In any event, the exact breakdown of my property taxes are as follows:
China Spring School District: $2,744.57
McLennan County: $740.15
Mclennan Community College: $250.04
Farm to Market roads: $17.73
I don’t have any problem with any of these taxes. Especially as I pay no income tax in Texas. The local schools are good and I have 3 kids in the school system. That’s one heck of a lot cheaper than private school tuition for 3 kids.
and the bubble has made it to China Spring. Who, pray tell, can afford $1M for a house there?
http://www.homes.com/Content/ListingDetail.cfm?City=CHINA%20SPRING&State=TX&FirstRec=1&Radius=0&Bedrooms=&FullBaths=&MinPrice=&MaxPrice=&PriceRange=&AmenitiesList=&PropType=%20&TotalRecs=15&PropIdList=57910932,55329281,57611706,52836686,46571697,58453571,57257673,55104007,60165218&PropId=57910932
Well, you know, everybody wants to live there, especially well heeled foreigners.
Either that, or maybe they are hoping some cult leader will buy it.
That house is 2 blocks away. When my wife and I moved into this neighborhood in 2003 it was under construction. The owner of the house is the president/owner? of the local NBC affiliate. When they built it his wife went absolutely hog wild with the decor and features. Imported hardwoods and stonework. The most expensive fixtures everywhere. Huge pool. Etc. Etc.
Now they decided that they actually want to live closer into town (from here it is a 20 minute drive to to about anywhere in Waco) so they bought a place by the country club in Waco and now have this place for sale. Last year it was listed as $1.3 million.
Thing is, there is actually quite a bit of wealth in this area. Waco has 2 large hospitals so there are lots of wealthy doctors. And lots of business executive types. China Spring is one of the two areas of Waco where the upscale subdivisions are concentrated. The other one is Woodway.
But the fact is, no one will ever buy that house. The people around here who do have $1 million to spend on a house want to build their own. No one in Texas wants a “used” house for God’s sake. My guess is that 95% of the people in this area who want a million dollar house are going to buy a prime executive view lot in whatever is the currently hottest subdivision and they are going to build their own custom home. That’s just the way things are done. Used houses over say $300 grand are just complete white elephants.
By the way, the county has that house appraised at $618 grand and the taxes are $11,800. I’ve found the county appraisals around here are pretty close to market value. In this case I would be shocked if it sells for more than about $550,000.
https://actweb.acttax.com/act_webdev/mclennan/showdetail2.jsp?can=180033070005015&ownerno=0
Texas is a fine example of why high property taxes are GOOD for the average middle-class person. It makes it very expensive to leave valuable real-estate sitting idle. So the land gets put to use, such as by breaking it up and building new houses. This increases the supply which helps keep prices down. If, by chance, the supply of land is temporarily constrained (unlikely in Texas, though that is a matter of geography rather than the tax system), the price of houses still won’t rise, because the buyers wouldn’t be able to afford the property taxes, regardless of how low the interest rates were on the mortgage. The bottom line is that a house in Texas is primarily something you live in rather than an investment. Contrast with California where everything is the opposite. Low property tax rates for new buyers and extremely low rates for people who’ve owned for a long time, so that people can let land go to waste even when there really is a land shortage due to the geography of the coastline. Tax increases are limited, so there is no constraint on how high prices can go. And the lack of property taxes means the government has to raise income taxes, thus driving high-income residents to other states (like Texas) with no or low income taxes. Everyone says Prop 13 is untouchable. Wait until the California economy implodes in the next few years while Texas does fine, and we’ll see just much support Prop 13 really has.
Many California based companies are moving to Texas because of the lower costs and that trend will accelerate. The California public school system is a wreck compared to almost anywhere else. Their public universities are no longer elite, except for UCLA. Is Cal-Berkeley still accepting students with a 600 SAT? What a joke. I could beat that score when I was in the 7th grade.
Belch
You know what, tx—I think I heard that one.
This is the 1st time I’ve had an opportunity to write: LMAO - that really resonated in my computer speakers txchic.
“‘Media reports are influencing buyers and sellers,’ he said. ‘Buyers and sellers think that mortgage money is scarce. It’s not. Mortgage money for flaky people is scarce. But mortgage money for everybody else is great.’”
Ahawhaw! Oh, this is funny. Mortgage money for ‘everybody else’, the non-flakes, IS great. But alas, those few people are not out buying houses now, because, see, they’re not idjits.
And now I shall go start the orange chutney, still giggling lightly.
“The house was listed Oct. 1 for $342,000. Since then, Middleman has dropped the price twice, first to $339,000 and then ‘drastically’ a week ago to $319,000.”
A “drastic” 6.7% cut from the initial asking price. What a bargain!
for less than 2000 square feet in suburban Austin. I was just out there in that neighborhood this week.
It’s gonna be a long cold winter for that bimbo.
following a “slight” increase of $200,000 since 2000
I thought she was really taking it in the shorts when she first dropped the price by a whopping 3K!
I guess they’re working off of a different definition of “drastic” than the one I’m thinking of.
Could I still get a liar’s loan, in Truth or Consequences, N.M.?
lol
“If you don’t know where you are going, any road will get you there.”
Charles Dodgson
Have a Happy Thanks Giving Every body.
We are on this forum, thanks to Ben Jones who works very hard and provides us with up to the minute and factual information. Gentle man it is thanks giving and Christmas is around the corner so let us hope and pray that people who are losing their homes, jobs money and are facing a serious recession can some how manage it. Let us hope our leaders have the courage to make the right decisions for keeping this great country GREAT. A serious recession will affect us all.
I hope that this is not the fall of Rome.
Thank you for reminding us that those suffer the most harm from the wrongful, ignorant and/or unethical actions of others are often the innocent. I too am worried about life post 2008 in the US. Unfortunately, I see no alternative to major market and bank collapses. Yes many deserve to go down in flames, but the collateral damage will be severe. Housing and stock market prices will fall at least 50%, most mortgages will be underwater, jobs will be lost, retirement savings drained, etc., etc. and the ramifications will be much worse than the mainstream public understands. While laughing at the plight of those that get what they deserve, let’s not lose our humanity. You know what’s just as, if not more, annoying than ppl telling us how much they made undeservedly in real estate the last few years, ppl telling those whose lives are in financial ruin I told you so. While we take control over the next couple of years, let’s not become what they were. Arrogrant pricks that like to gloat about the misfortune of others. I am not saying that the collapse is not necessary, and ultimately, it will be best to start over. Im just saying not lets be asses about it.
Enough preaching. Cheers.
More on the perceptions of J6P…not lookin’ good.
http://www.boston.com/news/nation/washington/articles/2007/11/22/poll_finds_the_mood_in_us_growing_darker