There’s A Fear Factor In California
The Monterey County Herald reports from California. “In Monterey County, the numbers are less drastic. But those trying to sell a home face an uphill battle as the inventory of houses on the market continues to climb: The Monterey County Association of Realtors showed 2,732 active home listings in the county last month. That’s up 61 percent from 1,671 in October 2005.”
“Home prices here haven’t dropped as steeply as in many parts of the state and across the U.S., said Monterey County Association of Realtors president Arliene Beesley. ‘I think it’s mostly perception,’ said Beesley. ‘There’s a fear factor: ‘Gosh, will the prices go down more if I buy now?’”
“For qualified buyers, real estate is still a good investment, said Beesley. ‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’”
“While the October median home price in Monterey County declined 10.1 percent from the previous month — down 5.3 percent from the previous year, according to the California Association of Realtors — some of the county’s pricier neighborhoods have a entirely different story to tell.”
“In the third quarter, most of the county saw price declines, from North Monterey County to Pebble Beach, across Salinas and down to the south coast.”
“In East Salinas, median home prices dropped from $528,313 to $395,000, and in South Monterey County, third-quarter sales dropped from $500,000 last year to $385,000. In Marina, third-quarter median home prices slipped from $650,000 last year to $540,000, and Seaside experienced a median price drop from $639,000 to $572,000, according to Monterey County Association of Realtors statistics.”
“Beesley doesn’t sugarcoat the status of the local housing market. It’s been tough on sellers, on real estate agents, on buyers who aren’t sure what move to make.”
“‘It’s a difficult year — we won’t minimize it,’ said Beesley. ‘This real estate downturn has affected the whole country, and that’s every corner of it.’”
The Ventura County Star. “Still stinging from the housing market’s credit woes that have left some potential buyers unable to qualify for financing, Ventura County home sales plunged last month while the median price slid further. Sales tumbled 52.6 percent compared with the same month a year ago.”
“While there’s been ‘a huge falloff in sales’ during the past two years, the median price has held steady, said Bill Watkins, executive director of the UC Santa Barbara Economic Forecast Project.”
“‘It seems the longer sales are weak, the more likely prices will weaken,’ Watkins said. ‘The most likely scenario — we continue to see weak sales and soft prices until developers’ inventories are worked down.’”
“Marcella Poitras, a Realtor in Oxnard, goes door-knocking for up to three hours every day to distribute 100 fliers. Poitras reports her sales have doubled compared with last year. Poitras credits her success to her determination and market conditions, namely the rise in foreclosures.”
“‘The market is saturated with foreclosures, and the buyers are finally ready to buy,’ Poitras said.”
“‘You have to be pretty serious to put your house on the market, because the offers that are out there are not full-price offers,’ said Hope Goss, a Realtor in Ventura.”
“This has been a tough year. October sales at Simi Valley-based Troop Real Estate were off about 30 percent from last year, said Brian Troop, president of the company. ‘Many of my agents are struggling a little bit, and they’ve had to take outside jobs,’ said Troop.”
From ABC 7 News. “That’s where changing locks on homes like this that have gone into foreclosure, has become a bit of a windfall for Joe Grant, the owner of ‘Poppa Joe’s Lock & Key.’ Joe Grant, Locksmith: ‘I’ve done probably 50 houses this year.’”
“With so many houses for sale in Contra Costa, one might think the business of making these signs is booming, but not so. Local sign-makers told ABC7, the demand for signs hasn’t changed much because for every real estate agent who needs a new one, another has gone out of business.”
The Daily News. “Home sales in the San Fernando Valley hit a record low for the second consecutive month in October, plunging 54 percent from a year ago as mortgage industry turmoil continued to roil the market, a trade association said Wednesday.”
“October’s median price slipped an annual 3.3 percent, or $20,000, to $590,000 and was off $33,700, or 5.4 percent, from September, the association said. Sales have now fallen from their year-ago level for a record 25 consecutive months dating back to September 2005. The prior mark was a 23-month decline from April 1989 to March of 1991. The association’s records begin in 1984.”
“From Toluca Lake to Calabasas, Valley home sales took a bigger hit last month than both Los Angeles County and the state.”
“Jack Kyser, chief economist at the Los Angeles County Economic Development Corp., said that the sales numbers are looking like they did in the early 1990s, the last time the market made such a big turndown.”
“‘I think people quickly forget how bleak it was in the early ’90s, but this is going to be a rough period,’ he said of the months ahead.”
“At the end of last month there were 7,730 properties listed for sale in the San Fernando Valley, a 16-month supply, slightly more than three times the stockpile of a year ago.”
“Association president Winnie Davis said…buyers still seem to be betting on big sales price reductions. ‘Waiting may not mean they will get a better deal down the road,’ she said.”
The Tribune. “The housing industry’s credit crunch took a heavy toll on Los Angeles County last month with home sales plummeting 42 percent from a year earlier, the California Association of Realtors reported Wednesday.”
“The region’s median price for October was $533,070, down 6.4 percent from the previous month and off 8.6 percent from October 2006.”
“The biggest local drop in median price occurred in La Puente, which suffered a 13 percent annual decline in October, according to additional information provided by DataQuick.”
“El Monte and La Mirada both posted an 11.4 percent drop in their median price. Other notable declines occurred in Covina (-10.5 percent), Alhambra (-10.3 percent) and Claremont and West Covina, which both saw their median price fall 9.9 percent.”
“‘The decline in sales is a rejection on the part of buyers to the prices that were out there,’ said James Joseph, owner of Century 21 Ambassador in Whittier and Brea. ‘Successful sellers are reducing their prices dramatically.’”
“Los Angeles County officials are bracing for a round of belt-tightening as property tax revenues fall short of expectations on drooping home values and the state prepares to cut off additional funds.”
“The assessed values of properties in the county rose from $570 billion in 2000 to more than $1 trillion this year. And as some people who recently bought homes watch the values drop, Assessor Rick Auerbach said he’s seen a slight increase in the number of people appealing their assessed values.”
“Two years ago, 12,172 homeowners appealed their valuations - this year that’s expected to hit 13,000 to 14,000.”
“Meanwhile, the number of foreclosures as of Sept. 29 totaled about 8,800 - or 8 percent of reappraised transactions - nearly triple the 3,184 last year that accounted for 1.7 percent of transactions.”
“‘Hopefully by the end of May, we’ll be notifying taxpayers for their 2008 assessment if they deserve a reduction in value,’ Auerbach said. ‘Obviously, for most people, a reduction in value means the actual value of the property has gone down in the last year. That’s the bad news because, for most people, their home is their largest investment.’”
“‘The good news, at least in some small way, is that their property taxes will also go down,’ he said.”
The Orange County Register. “Sales at Skyline at MacArthur Place have been halted through Feb. 1, said Cory Alder, president of Nexus Cos., which is developing Skyline. The home-loan crunch that dampened residential sales nudged Nexus to be the second Orange County developer to halt sales on units under construction.”
“‘With the credit crunch, there’s a lot of instability,’ he said. ‘We’re going into the holiday season, so let’s slow down until next year.’”
“He declined to say how many units are in ‘release 1,’ but the company said in late September it had sold 43 units of its 349 units.”
The North County Times. “More bad news came from RealtyTrac, which released figures today showing that foreclosures in California shot up 213 percent in the month of October from the same time last year.”
“San Diego’s foreclosure rate of one in every 260 homes was on par with the state average. The number of filings increased 165 percent during October when compared from the previous year.”
“Riverside County recorded the fourth-worst rate in the state…an increase of 313 percent from the previous year.”
“Analysts predicted that prices will have to drop further in order to work down historic levels of unsold homes and the slump in housing, already the most severe in more than two decades, could last for another year.”
“‘The light at the end of the housing meltdown tunnel appears to be an oncoming train,’ Joel Naroff, an economist with Naroff Economic Advisors, said in response to the new figures. ‘With so many choices and so few buyers, the median price is cratering.’”
The Press Enterprise. “The state is seeking an emergency federal grant to provide retraining for people laid off in the mortgage and banking industries, according to a statement from the state Employment Development Department.”
“Riverside County is one of the locations being considered because it is one of 12 areas in the state hit hardest by layoffs at companies such as Countrywide Financial and Fremont General, EDD spokesman Paul Feist said in an interview.”
“Other one-stop centers are considered for Los Angeles, Orange and San Diego counties, along with locations in Northern and Central California.”
“Gov. Schwarzenegger was in Riverside on Thursday launching a campaign to alert homeowners living in one of the nation’s most mortgage troubled regions to options that may enable them to save their homes from foreclosure.”
“Schwarzenegger announced the $1.2 million public awareness campaign a week after saying he had reached an agreement with four large mortgage servicing companies.”
“Mike Teer, a Riverside real estate broker who was among those to greet Schwarzenegger, said the governor’s loan freeze option would do no good for the majority of homeowners already headed to foreclosure on mortgages that have escalated beyond their reach.”
Here, at last, is an agent who has awakened to the fact that business isn’t going to come to here. She has to go out and get it:
“Marcella Poitras, a Realtor in Oxnard, goes door-knocking for up to three hours every day to distribute 100 fliers. Poitras reports her sales have doubled compared with last year. Poitras credits her success to her determination and market conditions, namely the rise in foreclosures.”
“Poitras reports her sales have doubled compared with last year.”
Tell her to prove it. Until then, I say bull sh*t!
Ya gotta point there, Ex-Nev.
I bumped into a blow-hard local realter (misspelled because I refuse to capitalize) that i’ve worked some deals with in the past at the beginning of this year. We’d already been a good year into our bust, and this knob proceeds to tell me he’s still closing 2 to 3 deals a month. 4 months later a friend I have in Costco tells me the dude was in applying for a job.
You can use my favorite - “realtwhore”.
Yeah, doncha just love people like that? They give you a big feces eating grin telling you how great they’re doing and then you find out they’re in the crapper. But before you find that out, you’re scratching your head wondering WTF? I used to watch all these folks in their SUVs with all their toys, wondering what I was doing wrong driving my paid-for heap and living in a dump (I’ve upgraded a little since). Until, as result of this blog, I find out these were mostly people in debt up to their eyeballs.
What the hell, the same thing is happening at all levels of society these days, in government (the economy is growing), in business, in the media. Everyone seems to have a toothy, phony, crap-eating idiot grin while they talk about how great things are, when in reality, things are circling the drain of a toilet bowl.
So, she sold one last year and two this year? Maybe she is counting a duplex as two sales.
Palmetto,
you ain’t alone. 3-4 years ago, even people I know very casually would tell me about buying this or that because “my apartment is worth more than a million now”. And we’re not talking penthouses, but pretty ordinary 2-beds on the West Side. Now, it’s all very quiet–who would be so crass as to discuss real estate? Just two friends who have stabilized leases also–and we are very quiet as well, but I have had the “boy am I glad i never bought” conversation with them.
Amen and tesify, brother Palmetto. I just started reading Financial Armageddon by Panzner. Man, I am still in the first chapter, which of course is about debt (a topic near and dear to me). Of course, I am gripped and will probably finish this baby b y week’s end (only 230 pages w/sources).
Palmetto, I am with you man. The debt load in this country is sick. I am fed up with how great things are in this country, esp. in light of this blog and a few others I read.
What a bunch of crapola. Sure, it might be good for the prince. Heck, ruin a company and then leave with 200 mil in cash, stocks/options, etc. What a farce we have become.
However, we are all to blame. We have elected crappy people to office. We have allowed our moral views divide us rather than agree to disagree and deal with the bigger issues of the country at large. We have also worried about bigger returns on our CDs, stock portfolios, and everything else.
I guess what I am sayin’ is we gotta start over. This thing can’t be saved as is.
Who’s with me?
“Who’s with me?”
I’ll flip the switch
“Yeah, doncha just love people like that? They give you a big feces eating grin telling you how great they’re doing and then you find out they’re in the crapper.”
Within the next 2 years, I will bet my bragging buddy will be in the crapper. He has 160 acres of Iowa Farmland (hardwood trees that “the Chinese want”) and bought for $160,000, “is worth $640,000,” and “will be worth $1.3 million within 5 years,” two Florida condos that “keep going up $3,000 per month in value”. He rents out his Florida Condo on Biscayne Bay. I once asked him if his tenant will notice the glut of condos in the waterfront area and shop around for a lower monthly rent when the lease is up. My buddy did not answer. He instead insulted me because I invest like an old man in government securities. Of course, he is against gold too, even as a hedge against low income rates on government securities. He also calls me a rent slave.
Thank goodness for Ben Jones’ HBB though. Sanity prevails here.
Sing it, my brothahs spike, Dan and ex-nv. According to the Constitution, we do have the right to start over and install a new government when the old one isn’t working out. And of course, this would include a new monetary system. I’m done with this game. Don’t even want to play it anymore. Stick a fork in it, it’s done.
“He instead insulted me because I invest like an old man in government securities. Of course, he is against gold too, even as a hedge against low income rates on government securities. He also calls me a rent slave.”
What a jerk. He’s lying through his teeth about the condos.
“…He has 160 acres of Iowa Farmland (hardwood trees that “the Chinese want”) and bought for $160,000, “is worth $640,000,” and “will be worth $1.3 million within 5 years,”…”
Call me jaded, but $160k seems like a steal for that size a wooded parcel. Heck, you can’t even buy 5 wooded acres for that price around here. What with the ridiculous taxes and land prices here in WA, perhaps I should look into Iowa farmland. $1000 per acre is a deal in my book. Sure beats $100,000 plus per acre.
it’s been about 2 years since i first started reading this blog… my how things have changed in that time.
i recall the flippers and know-it-all “get rich quick” shyster guru types used to be a favorite topic of this blog.
where have they all gone? christ, can’t even remember their names… help me out anyone? it’d be funny to hear what they’re saying now.
I think that’s about right for Iowa farmland, Bantering. I just don’t think the guy is going to see the appreciation on it that he thinks. There’s always a demand for hardwood, even if only for fireplaces. Even here in Fla some people who had orange groves that got hit by freezes converted to pine tree farms. Don’t know much about it, but they were content with the deal, back in 2000 anyway.
Gold is good insurance right now against helicopter drops from the FED. deflation is what we should expect with all this debt, so cash should be king ? But I hold some Gold and Oil stocks because you never know what the FED may do to save the banks. Thinking about selling more stock mutual funds, I smell a Recession.
“we do have the right to start over and install a new government”
same stupid people, same stupid government, no?
bantering bear - i have 400 acres near cal/oregon border adjacent to i-5 that i’d be happy to get $ 1,000 an acre for.
I don’t thinkgoing from one sale per year to two is that big of a deal
ex-
I was thinking the same thing…
Well, if she sold one last year and sold tw this year that would be a 100 percent increase in sales, right?
If she had zero sales last year and sold one this year, how much percentage increase is that?
Undefined.
“Well, if she sold one last year and sold tw this year that would be a 100 percent increase in sales, right? If she had zero sales last year and sold one this year, how much percentage increase is that? ”
LOL. Yeah, and who said it was real estate sales? Maybe she’s been peddling Mary kay cosmetics on the side…Smiles!!
My ex tried to sell that crap. What a useless scam that MLM business is.
DOC
Retraining?
I see ITF ( and other vocation tr schools) and Jr colleges increase in students this spring.
Lots and lots of retraining.
To do what?
Actually I should’ve said to do what that won’t be affected by the housing bust. Most lucrative jobs/careers created over the last several years are tied to housing in some way.
Chuckle…
I love the ads on TV to become a certified construction supervisor.
I guess they’ll learn how to be medical assistants.
LA/Orange county are toast. Did they create any high paying jobs that weren’t part of the REIC? TV filming going to Tucson… engineering to… everywhere. The mainstays of the region look to be pretty gutted.
Got popcorn?
Neil
If TV filming is coming to Tucson, it won’t pay shhhh—t. We’re the low-wage capital of the Southwest.
Der Terminator is full of shish. The F’dBs have NO equity, their credit is shot, too many lates, no savings, credit card debt too high. House won’t appraise this year. Adds up to NO rewrite! Don’t waste anymore tax payers money.But, it sounds good doesn’t it. Next time get a F’d B with little kids, lost her/his job, in a wheel chair, help me with this one guys and gals. hehehehehehe
Still PLENTY of entertainment industry jobs here in LA. The job market here has not cratered YET. I only hope that real estate prices fall fast enough that LA can become a competitive job market again. Right now I can’t fill my open positions because no one in their right mind will move here.
” Right now I can’t fill my open positions because no one in their right mind will move here.”
You got that right! You couldn’t pay me enough to live in the sweaty ball-sack of a world you got down there.
Right now I can’t fill my open positions because no one in their right mind will move here.
Hear ya. We can’t fill either (aerospace). Nor can our competitors.
As to TV jobs to Tucson, I can only go by what I read. However, I notice movie and TV hours ‘filmed’ in LA is on a downturn with Ad revenue (hours filmed) more than making up the difference. Maybe I read the wrong rags… but to me… isn’t ad revenue going to be tighter correlated with the economy? I’m not saying people will watch less TV (I wish…), but rather, more ads will get recycled (smaller ad budgets).
Got popcorn?
Neil
Meanwhile the software engineering jobs back here at the client where I work are going begging. The direct hires were talking today about some manager who wanted to put them on 3 shifts or get new hires. But there is no one with the experience we need. I heard the same old story at the subsidiary I worked at for several years since March 2003. Life is good and my wallet is thick.
Ah, yes. The sluggish labor market that some predicted on here. Some of this stuff is paint by numbers…
Rather than school stay at a Holiday Inn Express. The F’dB can then be over qualified to do any thing (brain surgery anyone Dr. Frankenstein?).
Criminal Justice. That’s what is mostly advertised on TV now. IT is gone. Medical is still there but not as much. Criminal Justice is a new thing.
IT is far from gone. Programmers, computer engineering perhaps, but there is plenty of work if you’ve got the right skills (as evidenced by the number of interviews I’m having to conduct every week).
That’s the big joke on retraining and job creation. Most are low wage service jobs. Any career that will provide a stable & reasonable wage would require either full college degree in a safe field or long vocational training like automotive. How are people supposed to live while training for years? And why should they get free training anyway?
If your talking So Cal or the Bay area, what’s safe and reasonable? I say whatever to the college degree. You take away MEW and the the high rollin’ housing careers created over the last several years and what do you got left? Just your skills? C’mon, I don’t care how much higher-ed you get, how you gonna manage to come right out of the shute an make 150K+, which, last time i checked, is minimal survival wage for those areas.
No, 150k isn’t minimal survival wage if you rent. 100k will get you a cute 2 bedroom house in a cute neighborhood with plent of $$ left over for mid-rate entertainment. If you have PhD in one of the in-demand industries (mainly physical science stuff in No Cal), then you will be middle class.
Sorry, didn’t mean to say middle class. Meant to say blue collar.
Shucks! I paid $1000 per month for a studio 1 and a half miles from Redondo Beach from 2003 to 2006. income started at $120,000 in 2003 and went to $224,000 in 2005 and over $200k in 2006. It’s an exageration that Los Angeles beach cities are unaffordable. Rentals there are affordable. Becoming a mortgage slave there in LA is NOT affordable.
“Any career that will provide a stable & reasonable wage would require either full college degree in a safe field or long vocational training like automotive.”
And let’s not forget the masses of folks in the IQ curve below the critical thinking aptitudes needed to train/perform these jobs.
DOC
OFHEO’s Q3 HPI report shows Sacramento had the largest YOY decline in 30 years.
More here
Any other metros out there had record plunges?
You can look at the numbers here.
Looks like San Diego also had a record decline.
The acceleration is the big difference this time. Last time YOY prices first went negative for SD in the second quarter of 1991 then stayed negative YOY through the second quarter of 1995 (17 consecutive quarters of negative YOY appreciation). But it took up until near the end of this four-year period (fourth quarter of 1994) for YOY depreciation to max out at -4.72 percent.
This time is different, as YOY price changes first went negative only as of the fourth quarter of last year, and as of last quarter (only three quarters later), the YOY depreciation set a new record of -5.07 percent.
Not only are we at a record rate of negative YOY appreciation, but we are also at a record rate of price deceleration.
On closer (graphic) inspection, prices may have decelerated more rapidly in 1982, during the worst period of the early-Reagan-term recessions.
(Don’t you mean “decreased” more rapidly. Not to quibble, but since you are a scholar … )
“Decelerated” is what I meant - a decrease in the YOY rate of decrease.
“For qualified buyers, real estate is still a good investment, said Beesley. ‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’”
It’s just getting used home sellers and the used home sales people who work for them to understand that there is a vanishingly small buyer pool at 2005 price levels.
Be afraid, be very afraid.
said Bill Watkins, executive director of the UC Santa Barbara Economic Forecast Project.”
“‘It seems the longer sales are weak, the more likely prices will weaken,’ Watkins said.
PINCH ME HARD! or you have got to be kidding me.
Economist dicovers the earth revolves around the sun. Dah, weak sales lead to weak prices. Especially when Inventory (lisitngs) are at all time highs and sales are at all time lows.
And the MSM quotes these guys.
chuckle.
And weak sales lead to cautious buyers. It also leads to very cautious lenders. My oh my. What will they do if they’re ever left with a pool of informed buyers? That is a salesman’s nightmare.
And yea… that high inventory. Its going to sting a bit. I’m sure they’ll still find reasons to lie and state a “V” recovery is coming soon. chuckle.
Got popcorn?
Neil
Oh yes, the good old V-recovery.
More like the L-recovery like it happened after the dotcom bust.
Dot.com bust was funny. Public “knew” more about what we were doing than we did.
Fine, but if they’re going to use the V, then I insist they capitalize it, because it’s mine!
BTW, the “V” may also be read as a down arrow.
I thought it was something like that. I thought it was like part of a sales chart. That’s why I once suggested that it should be “Big Backslash” instead of “Big V” — as in, who knows whether what goes down must come back up!
That dude Beesley reminds of the mayor in the movie Jaws when he’s out on the beach telling everyone not to be afraid of the water. Yeah right! You first Mr Beesley!
Perhaps Ms. Beesley (first name Arliene). Whatever. But then the journalist goes on to say, “Beesley doesn’t sugarcoat the status of the local housing market.” SURE (s)he does! (S)he’s still saying “RE is a good investment.” gimme a break …
Ex-nnv you have my encouragement to JT the Beesley person.
“‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’””
Desperation is a stinky cologne…
“For qualified buyers, real estate is still a good investment, said Beesley.
So, we’ll admit that the demand has fallen hugely, since we all know that the number of qualified buyers has dropped dramatically, but yet still argue that it’s a good investment? Why, is supply plummeting?
“For qualified buyers, real estate is still a good investment,” said Beesley.
Help me! I’m sooooo confused!
http://graphics10.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
BiM:
Once again, we have another metric implying that house prices will come down about 50% from peak, but they will probably overshoot a bit on the way down.
Well, the people in my area, Santa Clarita Valley, still think it is 2005 for the most part! They are all so in over their heads - I can’t wait until the declines really start to hit!! But, I forgot… Everyone wants to live there!!
‘Hopefully by the end of May, we’ll be notifying taxpayers for their 2008 assessment if they deserve a reduction in value,’ Auerbach said. ‘Obviously, for most people, a reduction in value means the actual value of the property has gone down in the last year. That’s the bad news because, for most people, their home is their largest investment.’” The good news, at least in some small way, is that their property taxes will also go down,’ he said.”
Actually, lowering taxes is huge. They can’t sell their homes anyway, so any financial break is a godsend right now.
If a house is an investment, why does it get preferential tax treatment?
Oh, brother. Don’t get me started on this one. But, not to worry, one of NPR’s Marketplace commentators beat me to it.
Well, the reason why borrowers get to deduct the interest from their taxable income is that someone on the receiving end of the interest (me) is taxed on that same money as income. Believe me, if they were not getting the tax deduction, they would never be feeling good about paying me 9%-10% on their debt. Anyway, I always hated the mortgage tax deduction — I overcame that anger only by becoming a lender and profiting from other people’s inane idea that the tax deduction made the interest sort of “free.”
But that doesn’t really make sense. I don’t get a deduction when I buy other stuff, why should I get a deduction for buying debt?
And why do they get residential loans instead of business loans?
“Association president Winnie Davis said…buyers still seem to be betting on big sales price reductions. ‘Waiting may not mean they will get a better deal down the road,’ she said.”
She’s right, waiting may not just mean a better deal, it will guarantee it…
She’s correct. Waiting may mean that the potential buyer dies or that Martians will move in and drive up property values. However, since these scenarios are exceedingly improbable, perhaps it would be wiser for one to wait.
A year ago in Maine, our local arts org wanted to buy the house adjacent to their performance center, and use it to house visiting actors/dancers/musicians. One of the several deep-pocketed people who were considering this purchase asked me what I thought about it. I said “Wait.” What actually happened was that the family who owned it decided to keep it after all. The Realtor who had had the listing went around crowing all this summer about “see what happens if you wait.” BFD. These outcomes are so unusual that he will probably be stuck with that single example until the whole bust is over with.
“The state is seeking an emergency federal grant to provide retraining for people laid off in the mortgage and banking industries, according to a statement from the state Employment Development Department.”
- SoCal is SO Candy-ass!
If you are in the state and even sneeze they will come up with a plan to help you!
Usually, it is only talk … we are so Hollywood programed that it is all about appearances.
Of course someone will complain that there has to be ‘Spanish Speaking’ for the retraining!
The problem will be that someone with only a high school education, or even college education for that matter, will most likely not be able to retrain into any field that pays half as much as they were making in mortgage brokering or used home sales during the bubble years.
Here’s history for you. In 1970 we were able to live pretty good life in LA in blue collar jobs. Had great SM apt and were able to go out to eat, drive wherever we wanted, and buy the usual day to day stuff. Found some old checks (anyone remember those) that we used to pay for pizza, chicken and pitchers of beer at shakeys for $3.25.
My grandparents, a mailman and a kindergarten teacher with three kids, were able to buy a house in Palos Verdes in the 1950s.
That was a unique period in the history of this country, never to be repeated again. The 50’s were probably the zenith of the middle class. It’s been all downhill since.
Here’s an interesting thought. Since the housing bust appeared to dry up my loan demand, perhaps I could claim eligibility for the “retraining.” I suppose I would then have to acknowledge a California residency, but at least I would be getting some direct services in return for my state tax money. Not that I feel the need of training, but it would be fun to see what jobs they think are available. Course I wouldn’t brag to them the way I brag to you guys, about the reliability of my current trailer-park clientele.
retraining—would you like fries with that?
“‘Hopefully by the end of May, we’ll be notifying taxpayers for their 2008 assessment if they deserve a reduction in value,’ Auerbach said. ‘Obviously, for most people, a reduction in value means the actual value of the property has gone down in the last year. That’s the bad news because, for most people, their home is their largest investment.’”
Woa… this is LA county. Prop 13 only allows the assessment to increase 2% per year. So, in effect, you are telling people they are underwater if you are telling them their home is being re-assessed for less.
This is going to be quite the wake up call. End of May… I’ll have to remember that. That should change the LA market sentiment dramatically. Just when buying season should really get going… people will start telling their friends how they lost so much money on their home.
Isn’t that also when a small surge in Prime ARMs reset?
Got popcorn?
Neil
Neil…here’s how it’s going to work. People don’t want to hear or believe that their property has gone down that much even though I’m sure that good ‘ol Rick (or rather that specialized computer program that they are trying to put together as we speak )will only lower the values of most qualifiying homes by a fraction of where they need to be. The usable comps will only be through the end of March…well before the end of the spring selling season. (They sure as hell hate using REO comps, even it those are the only comps available.) And that will probably be it for the Assessor giving any adjustments to assessments without requests by the tax payer.
See…Kenny Hahn did this in 93 and forgot about 94, 95, 96 as values continued to fall further. I believe this is an election year for Rick…who was appointed as the Assessor before the end of Kenny’s last term. Yeah…he’ll give a reduction but I don’t believe it will be any where near where most of the values should be and this will be just for homeowners.
Commercial/industrial/apartments/duplexes, etc will be on their own no matter what…when that market craters.
bikegirl,
I hate to agree with you… but your logic sounds right.
At least they’ll get one small wakeup call.
Yes I re-assessed for 60K less back in the early 1990’s in Ventura County, it was easy. I also remember about a year after I re-assessed the radio was full of ads offering this service for a fee. implying it took a trained lawyer to fill the paper work out? Always an angle to be played out in the world. Oh and I re-assessed from 165K to 105K big drop huh? Going to happen again I bet, glad I sold in 2006, learned my lesson the hard way.
Ventura County was a much smaller county to work with back in the 90’s. You filed an application for reduction in assessment, they reviewed it and gave pretty good reductions. Agents weren’t really necessary for Ventura, later years in Orange County, but LA is a nightmare to work with. First you file for what you call a “Prop 8″ review…the county reviews the property and if you were lucky they gave you a decent reduction. If you weren’t lucky, you got your no-decline letter after the appeal filing deadline and you were SOL for that year. If you got your letter before the appeal filing deadline (Nov 30th) or filed “just in case”, you could file an appeal, wait 12-24 months for an appeal hearing to hear your case (hopefully get a reduction with the Appeal Hearing officer who is employed by the “County” Assessment Appeals Board) and if you weren’t happy or the “assessor’s rep” got a bug up his/her butt and thought you got too much of a reduction, you then go to the Assessment Appeals Board or another hearing. They did make you jump through a few hoops to get reductions on many properties.
Yes…homeowners are perfectly capable of getting their reductions for their houses. Trained lawyers are not necessary unless it’s a very unusual case. It’s more of a time thing and if you want to deal with the hassle and nightmare that comes in the form of the county employee (that’s a whole other topic).
There are agents that charge for a full years of savings…hoping that the lower value will “roll forward” for a number of years. There are agents that will charge you a $65 fee to file the paperwork, but really what is their incetive to get you any type of savings. The best is probably somewhere inbetween…the more the agent saves you, the more he/she earns based on a fixed percent.
Can you guess what I did during the last real estate down turn?
Or you just wait to buy when the prices are back to reality… Much less hassle!!
“Sales at Skyline at MacArthur Place have been halted through Feb. 1, said Cory Alder, president of Nexus Cos., ”
HUH? Well I guess I better run down and grab one before there all gone, I’m sure this will increase sales. Keep that extra 200 off the inventory, yea thats the ticket. Problem solved-LOL. This seems fairly rediculous to me, but hey they make the big bucks-
another LOL.
The quote only says that “sales have been halted”. It doesn’t say who did the halting, the buyer or the seller.
I guess they are admitting that they aren’t generating enough sales to cover the cost of operating a sales office and renting furniture for the model homes.
In other words, they aren’t selling any houses.
Once again the MSM glosses over the trully scarry stuff the quote people saying. LA County tax rolls will revert back to the levels of 2000 means a reduction in the 40% range.
This does not include reductions in sales taxes that will hammer every level of government.
Nevermind a credit crunch in the financial markets. Watch for the turmoil in public spending. Public employee pensions will vapor lock and in order to save their jobs, they will decimate anything that is extranious to their self-preservation.
Boom Boom B hints another rate cut !! WTF !!
http://news.yahoo.com/s/ap/20071129/ap_on_go_ot/bernanke_3
WASHINGTON - Federal Reserve Chairman Ben Bernanke on Thursday hinted that another interest rate cut may be needed to bolster the economy. The worsening credit crunch, a deepening housing slump and rising energy prices probably will create some “headwinds for the consumer in the months ahead,” he said.
And the self serving jackasses they interview on CNBC just love the talk of rate cuts, anything to prop the Market up. Weak dollar and inflation be damned.
How is another rate cut going to help the economy? Personally, I think this is being done deliberately to cave in the US economy for the majority of people.
Agreed. Every rate cut causes another record oil price. One more and we’re over $100 a barrel guaranteed.
Sorry to nitpick…
But I think one more rate cut sets the stage for $120/bbl.
Well, I don’t think it’s that simple. Many other facote to consider. Recession may lead to lower prices, but we will see.
Palmetto, if the Fed’s goal is to cave in the economy for the majority of people, as you say, could you explain why that would be?
They may actually be trying to prop up US manufacturing sector. See tonight’s Lehrer NewsHour.
The market will go up for a few days after the cut, but it will all be gone by the following month. Recession does NOT equal higher stock prices (even with high inflation).
Got Ameros??
Yummy. He still had not figured out it will piss off those that finance this economy, aka treasury buyers?
Another rate cut, you better get on the gold train. Disclaimer: I own no gold except for some jewelry. I am not a gold bug. However, this might puch me to take out the CD early and go into gold. Heck, didn’t BB learn from his predecessor? Lower rates=less $ value.
What are these guys thinking? Oh well, PB’s War on Savers continues, in earnest, if this comes to pass.
Aww, this isn’t even news worthy anymore. Oh course there’ll be a cut, its partially priced in already and a lot of us have been counting on it. Go ahead Boom Boom - let ‘er rip! .50 or .25 - that’s the only real question.
WASHINGTON - Federal Reserve Chairman Ben Bernanke on Thursday hinted that another interest rate cut may be needed to bolster the economy. The worsening credit crunch, a deepening housing slump and rising energy prices probably will create some “headwinds for the consumer in the months ahead,” he said.
Head Winds Hell!! BB does know what is happening but he cannot stop it even with lower interest rates. U.S. 1% , Japan 0 %. Nothing changes…… It will be a Nuclear Winter!
He has no choice. The banking system is in far worse shape than anyone wants to say. It’s either cut rates, or banks start closing and we’ve got panic-lines down the street.
My bet is that not only does he lower, but he lowers by a full 50 basis points and then claims that “that should do it”. Of course it won’t do it… he’ll be lowering again after that…
Back from another sojourn with Sequoia trees…
Visited with Low Rider (about 1,600 years old) and Uncle Tilt (about 1,000 years old, tilts about 5% to the west)
What does this have to do with the housing bubble? You’re not even in the bit bucket.
Remain Calm. All is Well
I’m sure it’s a metaphor,… or a riddle maybe……..let’s just sit tight and look for the hidden meaning.
Ha, as if the dozens of posts every day regarding the stock market or gold or whatever are any more on topic. At least the Sequoias are in California!
Actually, I’d say that posts on stock markets and gold are ‘right on’ topic.
Because ultimately we’re talking about one thing: interest rates.
This whole housing bubble was created by low interest rates, and now the powers-that-be are terrified that the credit crunch is going to cause a market collapse. Which of course it will — but not if they lower rates. So market collapse and the speed of the housing collapse are very definitely related (inversely of course).
And if they lower rates… well… then that’s where gold comes in.
aladinsane, ignore the opposition here. I was born in central California and the Sequoia trees have always been my favorite trees - also the central and southern Sierra Nevada region.
The Sequoias were cut down 150 years ago to make shake roofs for houses (go to Grant Grove to see the stumps).
Definitely housing related.
Yes, I know about that. In the case of Sequoias, I’m a tree hugger and would nearly agree that capital punishment would the the correct response to destroying any of those trees. My favorite place to go is the Redwood Canyon grove. There is a 6 mile trail you can walk on in a loop. Dozens and dozens of big trees. Few people do that hike since the dirt road to it is kind of easy to miss from the highway. Ever see a “snow plant?” It grows in the same regions as those Sequoias. Very rare. Off and on, I contribute to the Nature Conservancy. It’s a private organization that buys up land threatened by development and preserves it. Totally free market libertarian, which is what I am. I’m against most environmentalists, including their crooked ringleader, Al Sore - because they want to force at gunpoint people and businesses to suffer.
It’s a private organization that buys up land threatened by development and preserves it. Totally free market libertarian, which is what I am.
Supposing we lived in a libertarian panacea, would you be equally cool with it if Georgia Pacific bought Sequoia National Park and razed all the trees? Better surely than forcing them at gunpoint not to do that?
Seems to me that this country HAD a nearly libertarian/lawless period in the past, i.e., the wild west/gold rush era. The results weren’t pretty at all.
“With so many houses for sale in Contra Costa, one might think the business of making these signs is booming, but not so. Local sign-makers told ABC7, the demand for signs hasn’t changed much because for every real estate agent who needs a new one, another has gone out of business.”
Common ABC7, don’t just report crap without thinking it through!
Fact 1: Inventories in Contra Costa are at an all time high.
Fact 2: Every home for sale needs a sign.
Therefore: Demand for signs is at an all time high.
Any single agent going out of business should actually be a net + for sign makers since homes already on the market will need new signs made for the new realatwhores…
Any single agent going out of business should actually be a net + for sign makers since homes already on the market will need new signs made for the new realatwhores…
Actually it makes perfect sense. During the last 3-4 years there were lots of listings and lots of sales. They made a bunch of signs during that period. Now there’s lots of listings but lots of unmotivated (realistic) agents. They don’t even bother with the signs any more (this was a fact with my neighbor last summer before she gave up trying to sell), or the agents take the sign down on stale but active listings.
In contrast, during the peak of the bubble (summer 2006), we took a drive and saw *easily* 50-100 signs in one mountain neighborhood. There were sometimes 10 signs at a single intersection.
Interesting - the fact that they aren’t even bothering to put up signs anymore isn’t something I’d considered, but definitely believable given how bad things have gotten…
Just hasn’t gotten that bad over here in Menlo Park (it’s different here:))
NB Bear, today I went for a short walk around the block to get some air after working on the computer, and I noticed a new house for sale on my same block, next street. The sign caught my attention because it was more like those things that you stick in your garden when you want to show your support for a candidate, just a little wire frame with the name of the realty company. I remembered that when I read about the signs. Could it be that realtors can no longer afford those big brackets they used to put?
I think they can just reuse the signs they already have.
After reading yet another article recently about the tons and tons of plastic garbage floating in the Pacific, I for one am glad to see the newfound frugality of the used house salesmen, even if it is forced upon them!
“In East Salinas, median home prices dropped from $528,313 to $395,000″
For those who have never been to East Salinas just think of East LA or some other ghettolized area in FL. Prices in East Salinas should be in the $30K to $90K max.
“Prices in East Salinas should be in the $30K to $90K max”
That’s way too high for Crop pickers.
Pimp & Circumstance
“Schwarzenegger announced the $1.2 million public awareness campaign a week after saying he had reached an agreement with four large mortgage servicing companies.”
Ah yes the big push. I got a flyer earlier this week, mostly in Spanish, telling me not to move out of my property (not a home owner) because then I would not be able to renegotiate any loans I might have. But here’s the interesting part, it was sent by a local hispanic congressman and not addressed to something like Mr.Mrs.Brown but to Mr. Brown and Mrs. Solis-Brown. In other words, I guess I got it because somewhere someone found out that my wife was hispanic.
I love the Spanish credit card offers we get because my husband’s last name is Hispanic. He speaks 3 languages, with Spanish being the one he speaks worst. They always want to give him a huge interest rate with really bad terms. Then we also get English offers, often from the same companies, with MUCH BETTER rates and terms. It’s kinda sad, really.
The world is run by white people…what do you expect?
“The world is run by white people…what do you expect?”
I expect you to add the word ‘azzholes’ before ‘white’.
Unless you live in Southern California!
Yeah - your tax dollars at work - Spending $1.2 million on a stupid PR campaign for an agreement that he didn’t really make.
Pols across the country are starting to freak. The hip ones know this is huge and they know they can’t be caught standing still. Just consider the $1.2M an investment in Arnie’s political future.
It seems in 2008 a whole lotta pols want to be the F.D.R. of the 21st Cent.
Did Beesley happen to mention the following: ”
The sales price to list price ratio for homes dropped 1.2 points to 90.7%. This was mainly due to an $18,000,000 home that sold for $12,788,000 for a 71% ratio. Removing that sale moves the ratio up to a more normal 94.1%.” This was reported for Monterey Co. by the Monterey Peninsula Home Team realtor.
‘There’s a fear factor: ‘Gosh, will the prices go down more if I buy now?’
‘You’ve got to have someplace to live.’”
Gosh, If I pay $599 for an iphone, will the prices go down more if I buy it now?
Well you lost out on $200 discount and now your pissed and you shouldnt be because ‘You still have a phone to make calls’
If people were pissed about $200 discount on a phone, they would be 500x more pissed about 100K discount on a house.
I think I’m going to make a ‘Pissed’ index chart showing how pissed ppl were during the market.
“Today we saw a 3.4% increase in the Pissed Index as home prices slouched 1.2%.”
“The NAR was quoted as saying: ‘There is no such thing as National Pissiness. Everyone is pissy differently, therefore, all Pissiness is local.
People are not really pissed, but are just standing on the sidelines tapping their feet, giving the false impression of being Pissed.
If these people would stop tapping their feet and flushing their cheeks, everyone would see they are ready to be happy. If the media stopped reporting on all these pissed stories, people would hurry up and be happy.’
Economists are now saying 2008 looks bad. The Pissed index is expected to make big gains throughout the year. According to the NAR however, people are generally content with the way thing are since the Median Pissed values are relatively flat.
Other expects counter that, looking at the index that way will not show how really Pissed people are.
So, as the PI goes up, what happens to stocks?
I may have to live somewhere, but I sure as hell don’t have to BUY somewhere!
“I may have to live somewhere, but I sure as hell don’t have to BUY somewhere!”
Somewhere along the line, the NAR was successful in making people believe that “not owning a home”, or “losing a home to foreclosure” is the same as “living on the streets as a homeless person”.
As far as scrambling the American buyer’s mindset, De Beers has *nothing* on the recent campaigns of the NAR.
hear hear.
So I guess my friends in Carmel Valley (not San Diego, but Monterey) are toast?
Bought early 2006 a 3/2 1400 square foot for $750K and thought they were getting a great deal.
At least the REALTORS in Monterey county are aware the market is falling. Up here in Humboldt county, REALTORS continue to say that prices won’t go down…and they only have by 5% thus far…but once the equity locusts from SoCal get squeezed, coastal Northern California should finally start to participate in the declines the rest of you have been enjoying!! Hopefully!!
In addition to the “you need a place to live anyway”, the NAR can add “you need a place to grow your pot” to Humboldt County.
Great. Now that I have a place to live in and a place to grow my pot, where am I gonna stick this Joshua tree?
“Up here in Humboldt county, … continue to say that prices won’t go down”
“High” numbers grow naturally in Humboldt.
So I guess my friends in Carmel Valley (not San Diego, but Monterey) are toast?
Positives: One of the best zip codes in the area, warmer than the coast, room to spread out
Negatives: Populated by trade-up retirees who relied on out-of-town sales to afford buying there, house quality is quite rustic for the money (as nicer new stuff is being built in the Salinas hills and old Fort Ord areas).
Monterey county is a lot like Hawaii. Incomes are incredibly uneven, with some mansions and some farm hovels. It’s a fantasy location for many people, so they’ll bid up prices when they can but the prices crash when the economy is bad elsewhere. Prices crash first and hardest in the speculative areas (Central Valley, Inland Empire, Nevada, Arizona), then–starting from a higher baseline–they crash by just as big a percentage in Monterey and Santa Barbara. Finally, big cities like San Francisco and San Jose squeeze down slowly.
Yeah, a lot of the houses are owned by out-of-towners as weekend retreats, and local house prices are mostly decoupled from local wages. Carmel on a winter weekday is just about deserted.
I think the 5% drop in prices is understating things. There have been some major drops in Salinas–stuff that used to be at $700K has is on the market as bank-owned at $550K. There’s a LOT of bank-owned inventory on the market in Salinas. Mortgage fraud was widespread. It turns out lettuce pickers really weren’t able to afford $700K houses.
The more upscale areas in Carmel and Monterey have been holding up better in price but are still down. There’s a lot of inventory on the market that isn’t moving, but the better heeled areas are probably better able to delay sales.
You have to be pretty serious to put your house on the market, because the offers that are out there are not full-price offers,’ said Hope Goss, a Realtor in Ventura
Hey, Hope, any offers ARE full price. Just not at the wish price these FBs want/need in order to clear their jumbo loans on a small value property. People need to get used to the idea that homeprices are now downsized (or is it rightsized?)
Retraining? = “would you like fries that that Big Mac”, or “Would you like that supersized” (just like their waistlines and big debt level). LOL
Another “retraining course” — “Would you like paper or plastic?”
I’m sorry but I’m really getting to the point of “who really gives a sh*t”. All the talk and lamenting how the Real Estate market has collapsed is alot like listening to someone who just got arrested for DUI crying over how they should have left the bar after their 5th or 6th drink. Now the reality of too much partying is really settling in and it could have all be prevented if the money tap had been cutoff sooner. Now everyone is crying about the hangover and the legal bills they have……too f-ing bad!
If the RE machine was so concerned about the market they shouldn’t have rode the money horse into the ground. Now that they have driven the market to an unsustainable level it’s everybodies problem and we’re supposed to feel bad for these fools. Let them eat dirt.
Rant off…..I guess I picked a bad week to quit sniffing glue.
They kept serving drinks even though they knew it was getting rowdy and the State Police were bound to find out and cordon off the exits for sobriety checks. And now their customers will never be back, and the ABC board is shutting them down. But it felt so good ringing those registers on every sale and having their customers never ask the price and slobbering about how wonderful they were at fixing drinks.
In fact, nobody had left work for days. They just sat down at the bar and joined in, and when the place finally got shut down, the workers were the drunkest of all, and could barely stagger out.
Another rate cut being extrapolated from Bernanke remarks. ES at 1480 right now. Seems like a long time ago that it was 1407 but it was only three days ago. What is value? Beats me.
TX, what do you expect in this world, esp. this country.
“Everyone knows the price of everything, but no one knows the value of anything.”
I guess that’s what you get from society when Mastercard tells us a week with our favorite team is priceless. Craptastic. Can I charge that at 245.567678% compounded daily?
No priceless is spending quality time with family and friends. Priceless is helping those in need or a neighbor who truly has a need. Priceless is putting more into life and this world then taking out of it. As a dear friend once told me though, unfortunately, more people only do this when they die. What a sad state we have become.
For me, priceless is being DEBT FREE with ample CASH in the bank. Let’s see Mastercard try to make a commercial out of that!
The other good seasonality trend is buy 3rd-to-last trading day of month and sell 5th trading day of new month. Why fight it until the end of next week?
Cause we are in an environment where a bombshell could drop at any time.
True, but the Fed has enough (perceived) power left to counteract this somewhat. And after such a week 3-weak period in November and now a stabilization and some recovery (with strong bearish sentiment still extant), the chances of a meltdown in the near future seems to have lessened somewhat.
OK, so Bernanke has calmed the water enough for a three day dead cat bounce, and you guys are sounding awfully glum today. Don’t worry, this bear is coming out of hibernation with a joshua tree safely tucked under each arm. We’ve got three more years of spiraling downward, and if the cheerleaders don’t do something for their hard-stolen loot, then it’s game over for all of us.
I’m not worrying at all. I don’t believe that we *need* a recession to keep the ball rolling, so I myself am not hoping for one…just predicting one.
That being said, a recession could clean out the pipes (so to speak) a bit faster, and get us back to being a society of doers, and not borrowers…or at least I can hope.
This is the editorial for tomorrow’s NYTimes…Save Our FBs and their Neighborhoods. Unfortunately, the Times does not understand that the loans have been sliced, diced, tranched, sold and now, devalued. No problem, the Times does not concern itself with investors in said mortgage products. Don’t know, don’t care. They want loan mods, and they want them now.
Please do not reference the RE article yesterday in the Times on what $6 Million Will Buy…the Times in it’s majesty wants to help the “little” people in their wretched little neighborhoods, because this is getting out of hand. They apparently just noticed it today.
But not a word about the investment fund catastrophe brewing in Florida. Well, you can hardly expect these folks to keep up. Here’s the money quote:
“As more foreclosures take their toll, the need becomes ever more obvious for a comprehensive, national effort to avert evictions. Last week, Treasury Secretary Henry Paulson Jr. wisely shifted his position on loan modifications, endorsing the idea that some at-risk loans should be modified en masse rather than on an inefficient one-by-one basis. If Mr. Paulson backs up his new stance with a plan of action, the socio-economic costs of foreclosures may yet be contained.”
Found out my landlord here in Phoenix bought a house in Ahwatukee for over 800K in 2006. It Zillows for 100K less. Oh and hes got his own business, appraising homes. What do you think? I got a bad feeling about this ?
“For qualified buyers, real estate is still a good investment, said Beesley. ‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’”
Take that ball of ..wax ..somewhere else Beesly. Or is it “beastly”?.
1) RE is NOT a good investment at this moment AT ALL, save a few truly distressed properties spread thru-out the US in sundry & diverse sh*hole cities and nabes.
2) Buyers SHOULD be afraid. Of people like YOU.
3) Except for homeless people (who are so-called PRECISELY because of it) everyone else HAS ’somewhere to live’ already. Whether you rent it or own it is irrelevant.
Comment by OCDan
2007-11-29 18:28:04
Amen and tesify, brother Palmetto. I just started reading Financial Armageddon by Panzner.
I am reading “Crash Proof” by Peter Schiff. It’s a must read. He has “Financial Armageddon” listed on his recommendation list.
I recommend anyone wanting to know what is really going on with the economy to check him out. You can do that by going to: http://www.EuropPacific.net Go to recources and click on vedo archives and check them out. He also has a radio show called “Wall Street Unspun.” Just click on weekly radio broadcast. It’s a great show.
Schiff’s been linked here many times over the years. Glad to see he’s about to get his revenge after all the blind bubble-heads harassing and denigrating him.
He can definitely lay claim to being one of the original economists who “got it.”
I just bought the book and am halfway through. This is a MUST read!! I love Peter Schiff!!!
Real estate always cycles. Ups and downs. Are we panicking too soon?
Like Marcella Poitras, just work more consistently.
“For qualified buyers, real estate is still a good investment, said Beesley. ‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’”
I nominate this for Dumbest Quote of the Third Inning of the Crash. Let’s vote on the dumbest used home salesmen quotes and send the winner lots of e-mail.
from the Used House Salsepeople’s officially sanctioned dictionary..
investment
Noun
1. The purchase of some item of decreasing value with the expectation of taking a loss.
“For qualified buyers, real estate is still a good investment, said Beesley. ‘It’s just getting people to understand not to be afraid, if they buy a good house in a good neighborhood,’ she said. ‘You’ve got to have someplace to live.’”
HOW CAN YOU NOT BE AFRAID OF A 30 YEAR, $3500/MONTH MORTGAGE MS BEESLEY?????????????????
Every single month, month after month, THAT is what you will have to pay….which means what? You better be slave to your job, be slave to your situation and circumstances, sacrifice in every other aspect of your life….new car? Forget it. Nice long vacations, kiss it goodbye. Want to work part time….what a laugh.
Honestly…as I have said many times over…the best form of slavery is the type that you don’t realize you are enslaved. The modern financial institution of this country makes labor-based slavery of the 19th century look like child’s play.
Understand not to be afraid….yeah right…what a laugh.
The entire banking system revolves around slavery.
$590,000 for the median price of a house in the SF Valley????????????? Holy sh%#….and people think this is going in the right direction????? $590,000…just think about that. That is plain retarded.
OT: Yesterday, I posted a link to an article about the Middle Class being on “shaky financial ground”, which attracted several comments and questions. One person mentioned that there was no specific definition for the middle class family. That’s probably true, but the article was only a small part of the study. The full document (24 pages long, complete with table of contents) is located here: http://www.demos.org/pubs/BaT112807.pdf
The following is found on page 4 of the study entitled, Middle Class Sample, Defined:
Income Range—Household income at least 2X but not greater than 6X Federal Poverty Guideline for family size. (Under 2006 Guidelines,
$40,000–$120,000 for a family of 4.)
Age Range—-Head of household age 25–64
Assets Cut Off—-Families whose net financial assets placed them in top 1% of holders were eliminated. (Greater than $500,000 in net financial assets.)
In our final middle-class sample, the majority of respondents were married (65 percent) and lived in urban areas (85 percent). The average age was 44 and the average family size was 2.8.
Seventy-six percent of the sample was white (non-Hispanic), followed by African American (10.5 percent), Latino (8.8 percent), Asian (2.5 percent), multi-racial (1.2 percent), Native American (0.6 percent), and Pacific Islander (0.5 percent).
BayQT~
Bet that fits a lot of people on this blog — and explains why so many of us are angry about the decimation of the middle-class.
The money market’s problems have nothing to do with sunken sump-prime assets weighing down bank balance sheets to an unknown extent. Rather the problems are all about the psychology of fear (at least according to many of the morons writing in the MSM these days…).
Fed mulls liquidity tools but ammunition limited
Thu Nov 29, 2007 8:03pm EST
By Tamawa Kadoya
NEW YORK (Reuters) - The U.S. Federal Reserve is considering further steps to deal with a renewed surge in money market interest rates, but the central bank may be limited in what it can do by the market’s major problem — fear.
Money market rates around the world have surged in recent weeks as year-end funding needs have been exacerbated by growing worries about further bank losses as U.S. mortgages default rates climb.
Fed Vice Chairman Donald Kohn acknowledged on Wednesday that the short-term funding market remained under stress, and said central banks should look at what they can do to help.
“Central banks, including the Federal Reserve, need to give some thought to how all their liquidity facilities can remain effective when financial markets are under stress,” he said.
http://www.reuters.com/article/pressReleasesMolt/idUSN2955065020071130
In the Florida condo market, it’s easier to make a fairly accurate guess on the price rise/decline since one could just look up sales record for the same or similar high rises within a specific area.
Two years ago, the new luxury oceanfronts were going for ~ $900/ft sq (more for the ultra high end). Now, you see the actual sales registering in the 400’s and 500’s, which would make for a 40-50% drop of the 2005 high.
The “cheapest” high end - low floors facing away from the beach - had dropped into the mid-300’s.
And, while 4-5 year worth of inventory levels is just about as bad as it can get at the moment, the worst is yet to come, as there is a slew of unfinished projects that will come to the market within the next 12-18 months. That, foreclosures and the sliding sales may push the inventory into the 8-10 year range.
This is as brutal as brutal gets.
Some parts of San Diego County already down 30% or more — and still a long way from the bottom. They just don’t show up in “official” numbers.
I think the main reason that we’re in this mess is that there isn’t enough fear of repercussions for those that take on too much debt to be able to pay it off later. What we need is a system of garnishing people’s wages for a period of time (years or decades) until their debts are paid off. If that causes them to fall below poverty level (wages - garnishing), based on family size, then the difference can be made up with food stamps. That way, people are still liable for their own debts yet they can’t claim that they are starving to death. This would prevent people from walking away from their debts yet buying unnecessary stuff that only the rich people should be buying. Sounds tough? Tough sh*t. You F up, you pay the piper, yet you aren’t going to starve to death–just live meagerly, within your means, unless you truly can afford lavish things. That is not barbaric. That keeps a system of checks and balances in place, and it prevents making financially prudent people paying for imprudent people’s mistakes. Am I right or wrong?
“What we need is a system of garnishing people’s wages for a period of time (years or decades) until their debts are paid off.”
Excellent idea
~Misstrial
Ahhh….the good old days. There’s nothing like the sheriff showing up at the employers office serving a wage ganishment or better yet what they call a “Till tap” (Sheriff sits at a retail location owned by the debtor and takes the days reciepts from the cash register to pay some of the debt) to get a debtor to “dig deep” and pay some of their debt (this was good for small debts under $5K. Larger ones who knows what is effective.
They already do wage garnishment in cases of child support and alimony. How is my idea more severe than that?
Like to see those prices on real estate in Monterey finally go down to somewhat sustainable $300+ now that is something to cheer about. Monterey has always been way over priced for what one gets I mean a small 3 bed 2 bath hardly no yard no garage in the middle of fog most of the time for (use to be) $700K what the —-! I and no jobs….decent ones that pay for this type house…where do they think one is going to get this money…oh thats right the old timers of this area only want movie stars and such well get real they go where its WARM! remember in the 80s you could actually get a decent home that looked nice and maybe even with a view of some type for less than $200K….So now it is great to see them back almost where they should be. Some of the owners of these over prices B— S— houses bought them almost at the turn of the 1900 for a few bucks and never pay any taxes yet they have the gall to charge way too much without fixing them up!!! I remember renting a house on spagheti hill in the mid 80s that did not even have a stove and I paid $1600 per month!!! and now that house hopefully has gone down by $500K because the same owners own it and they are still charging way tooooooooooooooo much for this piece of crap house. People want better and want to be treated better so this is good!!! It will go down a lot more and who knows if it does I may just invest in this place that I left for much better land at a fairer price!!! and with jobs!