It’s Amazing How Quickly It Turned
It’s Friday desk clearing time for this blogger. “John Davidson re-located to Horry County, South Carolina, a few years ago. ‘We were real excited about the way the area was growing, no way it was going to slow down…how could it possibly slow down?’ Davidson said. ‘It’s amazing how quickly it turned.’”
“‘What’s happened is the people who bought on the high end can’t afford to lower their homes that much because they paid a lot for them,’ said Tom Maeser, a local real estate market analyst. ‘The buyers are sitting here, knowing there’s a lot of inventory, saying, ‘I want the best deal.’”
“Davidson’s had his house on the market since April and now has to sell it just so he can keep his condo. ‘We’ve had a steady flow of people coming through, but the consistent remarks are: love the house, but it’s priced a little too high, and they’re going to wait and see what happens,’ Davidson said.”
“‘There’s only one reason a home doesn’t sell, and that’s price,’ said Maeser, who has been a real estate agent for 15 years. ‘Sellers are going to have to get the 2007 mentality instead of 2005.’”
“Economist Jerry Johnson broke the bad news as home builders and bankers dined on scrambled eggs, hash browns and bacon at the Oregon Convention Center. ‘2008 is going to be a tough year,’ he said.”
“Speaking on housing prices, economist John Mitchell said: ‘There will be increasing affordability. That’s a polite way of saying price declines.’”
“As for a rebound, ‘It’s going to be 2009,’ Mitchell said. ‘You’ve got a lot of inventory to work through.’ So what does this mean for real estate jobs? Mitchell told one story: ‘My daughter’s Realtor is becoming a phlebotomist.’”
“From South Memphis to Southwind, Memphis is losing value. ‘Right now, Memphis is down about as far as I can remember in 30 years,’ auctioneer John Roebuck said.”
“Treasurer’s offices all over the country are bracing for the day when lenders stop paying the taxes on many properties in the worst hit neighborhoods. Many houses in Cleveland’s central city neighborhoods have been so damaged by looting, fires and weather that they are almost total losses. The lenders will eventually walk away from them.”
“‘The lenders will come to us and say, ‘We just can’t hold the properties any longer. We don’t want to pay the demolition costs. Here’s the property,’ said Jim Rokakis, Treasurer of Cuyahoga County, which includes Cleveland.”
“Zoe Cruz, co-president of Morgan Stanley and Wall Street’s highest-paid female executive, was ousted three weeks after the firm disclosed $3.7 billion of losses on mortgage-related securities at the division she oversaw.”
“‘I’m surprised, she’s been a big disciple of John Mack,’ said Douglas Ciocca, who helps manage $1.6 billion, including Morgan Stanley stock. ‘It may well be to satisfy the public’s need for scapegoats.’”
“The Singapore Housing and Development Board is building up the supply of new flats by 10,362 units to meet rising demand. Separately, the HDB plans to build another 6,000 units under its BTO system in the first half of next year. The total number of flats offered under BTO this year is 4,800 units, double that of last year.”
“The National Development minister urged buyers not to be too choosy when offered a new flat.”
“‘Be realistic about the chances of getting a flat. If you need a new flat, please take up the new flat even if it’s not something you like, even if it’s not ideal for you. Take it up and then gradually over time, you may upgrade to the flat that you like,’ said Mr Mah.”
“American Residential Group, a Tulsa real estate development and management company, is now in a ‘pre-marketing evaluation’ of changing the Tribune complex from apartments to condominiums….as a testing ground for a multimillion-dollar expansion.”
“Senior VP Steve Ganzkow said no one has attempted this type of effort since the late 1970s to early ‘80s. ‘We’re dealing here with an asset class in the real estate world that is pretty new and unique to this market,’ he said.”
“Ganzkow suggested prices could range from $175 to $200 per square foot. ‘There’s a lot of people who would say for that kind of money I would go get a house somewhere, and you probably can,’ he said. ‘But then you wouldn’t be downtown.’”
“The NAR and Lawrence Yun, its new chief propagandist — er, economist — continued to fiddle and insist that all was well. Take a look at this ridiculous and self-contradictory release, titled ‘Mixed Results for October Existing-Home Sales; Mortgages Improving.’ The NAR follows that front-line fib with what I can only characterize as a big, fat, stinking lie. The first line begins, ‘Single-family existing-home sales were stable in October.’”
“‘Mixed’ results? ‘Stable’ sales? There’s nothing mixed about a nearly 21% drop from October 2006. There’s nothing stable about a housing inventory that has jumped 15.4% year over year, so that the months’-supply number screamed upward by 46%.”
“House prices dropped by an average £65 a day this month, the fastest rate for 12 years. Further fuelling fears of a property slump, mortgage approvals in October also crashed to just 88,000.”
“It was the lowest figure since February 2005 and contrasted to a recent monthly average of 109,000. Nationwide’s chief economist Fionnuala Earley said: ‘This data confirms the market is cooling.’”
“The Council of Mortgage Lenders urged the Bank of England to ‘unblock the funding logjam.’”
“With Arizona ranked eighth in the nation in the number of foreclosures, some advice for people who fall behind on their mortgage payments. Number one, call your lender.”
“Banks don’t want you out on the street, says Chase Bank’s Tom Kelly. ‘What we want to do as mortgage servicers is to work with customers to try to keep them in their houses. We don’t really want to own houses. We would like people to pay us back.’”
“A lot has changed in the real estate market in the past year. Advice that brokers gave clients only a few months ago no longer applies.”
“As far as Johnny Matos is concerned, the prices haven’t come down enough. The Levittown native recently sold his home in Orlando, Fla., and moved back to Long Island. He and his wife are now renting a one-bedroom apartment in a Wantagh house.”
“For the time being, Matos says, he thinks it’s more economical to rent than to own. He is paying $850 a month but figures he would likely pay about $4,000 a month in mortgage payments, taxes and insurance if they bought a home.”
“Still, he expects to purchase a place in the next year because his wife wants to start a family. He says he’s hoping prices will drop more by then. ‘In the last year nothing has enticed me to buy,’ says Matos. ‘For me, it’s just waiting until somebody gets desperate.’”
What a great industry reporting week! We have them on the run now. My thanks to those who support this blog. Please check back this weekend for news, your market observations and topics.
Thank you, Ben.
Sincerely,
Maven
Maven,
How is the coverage locally on the lock down of withdrawls from the FL Local Government Investment Pool? I know other states are seeing similar runs but I’m curious as to how Joe or JaneGovWorker are reacting.
It’s a pleasure having a ringside seat @ your information circus…
Thanks~
Ben,
I love this blog and thanks for the chair!
Ya know, I thought you were pulling my silly toes when I read this statement posted below!
I really do believe you are defining main stream, there are just too many original coined axioms here that are bleeding through!
“The NAR and Lawrence Yun, its new chief propagandist — er, economist — continued to fiddle and insist that all was well.
Er…
Laughing out loud!
Leigh
This was probably on here a few days ago, but I just read it when scrolling though Diana Olick’s Realty Check. A quote from Lawrence Yun:
“I’m glad we are living in a free society where we have the right for the bloggers to blog and have fun at it. So it’s great that people can blog. . .
We have revised down our forecast by, I believe, by 8 straight months according to some bloggers. I have never kept track of it. . . ”
http://www.cnbc.com/id/22009801
testing one two three, maybe da chair has been moved for me!
A Pirate looks @ 46…
Mother, mother motion, I have heard you call
Wanted to sell upon your markets since I was
Three feet tall
You’ve seen it all, you’ve seen it all
Watched the men that rode you switch from
Honesty, it seems
And in your belly you hold the treasures few
Have ever seen
Most of em’ dreams, most of em’ American Dreams
Now I watch the pirates, 200 years has not changed their game
Wall Street still thunders, but there’s nothing to plunder
I’m an over-40 victim of fate
Watching it fade, watching it fade…
http://www.youtube.com/watch?v=jw7qzpSwucc
Nice. I’m a parrot-head, too.
Haha….. “NARleys”…. Seth Jason has been absolutely unforgiving in his commentaries on NARbage.
http://www.fool.com/investing/general/2007/11/28/realtors-fiddle-while-home-sales-sink.aspx
Motley Fool has been great at calling it like it is.
After it happened, yes - before, no. Not at all.
“My daughter’s Realtor is becoming a phlebotomist.” …. once a vampire, always a vampire?
Does that mean they get 6% of my blood?
I kid I kid
Go for “Blood Lite” (plasma).
My Joshua tree pastime has made me think proctology might be good for me. At the very least they could hire me to remove polyps. I’ve found my method very effective at removing the unwanted nasties of the lower intestine.
Ex,
Ouch! You’re not getting any where near my colon.
Full disclosure: took a realty course, did not have stomache to get license.
Grins,
Leigh
If you have to work with assh*les at least you’ll get paid well
That makes sense. As a real estate agent you are taught to bleed people out. Repeat after me. “It’s always a great time to bleed.”
I just knew the phlebotomist thing would get a rise out of this group.
It’s a great time to buy
It’s different here
It’s mania
Banks are starting to move their inventory!
Talked to a business owner today who said he bought an bank owned house for $69 per sq ft. He knows it’s early to buy, but the deal was good enough for him. He said the bank took a $140,000 haircut, $385k down to $245k for a 3,550 sq ft house in Surprise.
And he paid too much…. no SUPRISE!
the bank took a haircut, but he won`t?
I keep hearing this from people around me. “Maybe next year I will buy. It’s probably too early but it will be a good time.” I just ask why they would want to take the chance of eating the really big drop. Deer meet headlights.
Time will tell. I think he’ll get a crew cut, but he can afford it.
I thought this was interesting because I’ve also heard about banks not allowing a short sale in order to save $20k. Once banks and mortgage companies (CW) start selling their inventory, the prices are really going to crash in AZ (like they haven’t already).
Lip — too late in the day to post FL stuff, but a buddy of mine on the east coast of FL sent me some closing prices that were impressive — 40% off original asking and at around 2002 “real” prices. Getting there fast. Finally.
Interesting comments about SC and Memphis. My best friend lives in SC and bought two condos 2 years ago to flip. He’s now about to declare bankruptcy and lose both of them. I feel for him.
As for Memphis, that’s an interesting city. My aunt has lived there for 30 years. It’s actually a really cool kind of hip city with some neat old historic neighborhoods. She lives in one artistic kind of area and paid under 40k for her large arts and crafts bungalow. Even now, I think it might be worth 130k.
The city has a bad crime notoriety, but after living near Oakland for years, I’d say the two cities are very similar. Some areas are bad, and some aren’t. You just stay in the good areas and you’re fine. My aunt has never had a problem. But the crime perception is probably what keeps the city safe from the throngs of Floridans and folks from the Northeast. People with families want lilly-white, safe havens for the kids, thus Memphis is off the list for most of them. It’s actually a pretty cool city, so in some ways it is good that it has such a nasty reputation.
“We would like people to pay us back.”
When banks start stating this, you know it will not end well.
You’re right. While they would like people to pay them back, it just isn’t going to happen. And the lenders would have known this if they had done any real underwriting and used some common sense.
The big banks are in big trouble due to the securitization craze. What is talked about less is all of the smaller banks that didn’t get into the mortgage craze. Oh, but they did show up to the party. They have out a ton of construction loans and HELOCs. There are a boatload of little banks that are in deep trouble right now. That gets less press. For now!
There is a local bank that I will not do business with because they have written way too many construction loans. They were the “go to” bank to get things done when no-one else would write them.
Fortunately, my current bank seems to have pretty high underwriting standards. My worry is that I have a CD at another bank that might also be than creditworthy (of our money at least..)
It’s FDIC insured but early next year I will be looking around for a balance of rate vs. potential insolvency.
Fine print, I believe, in FDIC, is that it is insured, but they can KEEP your money for up to ten years. It is safe.. but from you as well.
Double check on that. Something I recall either Suze or ? telling the public 5 or so yrs ago.
Dweller — if that is true, many of us would be interested to know the details, perhaps tomorrow or Sunday.
Excellent point! It is much more evidence in smaller town USA.
Perhaps it’s only a matter of time before az_lender’s clientele stop making their mortgage payments promptly. I have just phoned Merrill to see if anyone is late. Nope, they’re not. Admittedly, tomorrow is the 1st, some of them will be a few days late with that. BTW the inquiries I received about new loans earlier this week did not turn into anything real. I mentioned “really big down payments.” That’s probably what stopped them dead in their tracks.
AZ - late in the day — the carnage here in Florida is amazing. Everything we predicted and more,relative to where we are in time and relative to the Pigmen trying to slow the tumble.
“‘There’s only one reason a home doesn’t sell, and that’s price,’ said Maeser, who has been a real estate agent for 15 years. ‘Sellers are going to have to get the 2007 mentality instead of 2005.’”
Bummer they have to adopt a 2008 mentality soon.
And 2009… oh. Sellers aren’t going to like 2009. Actually, I don’t think anyone will.
Got popcorn?
Neil
Does the 2008 mentality involve grabbing ones ankles?
Yes, and repeating the phrase, “Thank sir, may I have another?”
Doh! Make that “Thank you, sir, may I have another?”
You know whats weird? Thats the way I read it the first time and would have not noticed the error unless you pointed it out.
Then you must’ve been Mssing It.
Governator: Das is deep thoughts……enabled me to become governator…..stupid peasants fill in the da blanks….in their own mind….dey are smart.
Oh yes. You’ll be getting buff performing the ‘Joshua tree workout’.
I’m thinking the “V” turnaround will lose credibility about next September. By then they’ll hope for an “L” recovery, but it will be looking like a very limp “L” right then…
Got popcorn?
Neil
sort of…the bank will say I’ll get on my knees if you (the FB) get on your elbows….
“Sellers aren’t going to like 2009. I don’t think anyone will.” - Neil
Neil! YOU will. Lots of HBB heads will. If we can wait that long.
I was thinking broader economy. Scary times ahead. Oh, I’ll be fine. But J6P might have a pitchfork and torch by then!
Got popcorn?
Guns and butter?
Neil
Neil - that reminds me of a classic joke that is not for for telling here, but ends with something like, “Fridays — Oh, then you’re not going to like Fridays.”
“The Levittown native recently sold his home in Orlando, Fla., and moved back to Long Island. He and his wife are now renting a one-bedroom apartment in a Wantagh house.”
My wife grew up in North Wantagh, Levittown school district. It is completely illegal to rent out part of your house in these Long Island towns. As mentioned, this is going to be the big battle — desperate homeowners and investors vs. neighbors worried about property values and the working poor moving to the suburbs, some of whom have dark skins and foreign accents. OK for them to work there, as long as the get out of town by nightfall and no one has to pay to educate their kids.
Well, you can get the proper permits. Very few do, yet illegal apartment rentals in homes is very prevalent all across the Island. It is rarely enforced.
In 1980 my aunt bought “the old Vanderbilt estate” in Mill Neck. She won a sealed-bid auction. She didn’t have the dough, so had six (6) illegal tenants living in the basement. Did the authorities ever notice? Hell no. Anyway she was the attorney for either the village of Mill Neck or the village of Oyster Bay, so who was going to cross her!
Friends in Bend, OR bought into a place where CC&Rs prevent renting. On their street are seven (7) empty houses bought by specuvestors, who are now screaming that they should be able to rent them out. Our friends have a long-established, statewide business there, so they are in Bend for the long haul, but these other folks are HOSED.
Bend, OR is a beautiful area for those who enjoy the outdoor’s four seasons, but the housing is way over priced relative to the area’s incomes. Same goes for Redmond too. Insane!
Also, the wife, who wants to start family now?
Unless she is close to 35..ask her to wait 1.6 yrs.
Then you can buy.
>>Unless she is close to 35..ask her to wait 1.6 yrs.
Or, if they think it’s the right time, don’t wait. When did all these people decide babies can’t live in rented housing? Is it supposed to be bad for their emotional development or something? Nonsense.
“Try not to make any major purchases right after you move into your new home. Make sure you have your finances set, and your monthly budget in working order, before you go make a major purchases.”
No s**t, Sherlock!
I know some got cashback deals to get the place spruced up and maybe some nice furniture and a car to go with that house.
Idiots…
We have waited years to get the right things we want. We’ve been in our house for over four years and still nothing new has gone in the backyard.
When we bought our McMansion in 2003 we had a pinball machine delivered the day we moved in. I quickly realized that I liked the pinball machine a lot more than I liked the house. We sold both when we moved to the City and moved into a West Village closet. I am much more interested in getting the pinball machine back than getting the house back.
What is being described above is being house poor. That is a terrible way to live.
Agreed. We lived house poor for close to a decade. Granted, we sold at close to the top of the market, but I’ll take the cash any day of the week over “pride of ownership”.
We see lots of McMansions here in Portland (OR) that have sheets for curtains. Often there are also one or more newer cars. Some - more lately - are near-empty of furniture.
We’ve lived in two PUD’s (Planned Urban Development), and we will never own a ‘Garage Mahal’ again. Beautiful interiors, but the rest (privacy, HOA, pod people) was dreadful. Only good thing, was our piano sounded great, even with me playing.
heck that is what garage sales are for..
more so now and the next year than ever before.
I project that lots of nice things will be in estate/garage sales this spring.
RE: “‘The lenders will come to us and say, ‘We just can’t hold the properties any longer. We don’t want to pay the demolition costs. Here’s the property,’ said Jim Rokakis, Treasurer of Cuyahoga County, which includes Cleveland.”
Whooweee! Obviously the work-out boys are getting negative value appraisals (cost of demolition is more than the value of the residual site) for their re-po’s and they’re walking.
Wonder who all the MBS bagholders for these dumps are?
State investment pool of FL maybe?
I wouldn’t be shocked. Property sales here are at prices tanking faster than even I, a permabear, would have expected relative to recent MSM propaganda and “stats.”
Bush, Banks Working to Freeze Mortgage Interest Rates for Troubled Borrowers
http://abcnews.go.com/Business/PersonalFinance/Story?id=3936192&page=1
On that note, I need a stiff drink!
Buyer — don’t worry. The lenders will not lose. The FBs will just be skinned more slowly and painfully. Sorry to border on the graphic, but it’s true. Watch, wonder, profit from the experience.
“‘I’m surprised, she’s been a big disciple of John Mack,’ said Douglas Ciocca, who helps manage $1.6 billion, including Morgan Stanley stock. ‘It may well be to satisfy the public’s need for scapegoats.’”
It doesn’t satisfy the public’s need — not even close. These fallen subprime kingpins will enjoy their billions of dollars (including a retirement package valued north of $1 bn on its own) out on the fairway while the debt crisis sinks the U.S. economy.
NOT FAIR!
Yeah, don’t cry for Cruz…annual compensation package north of 20 million a year, and her hubby is another Wall St. biggie. Some sacrifice.
How PC of Ciocca to allude that her losing almost $4 billion didn’t warrant her firing. It must have been her gender.
Just when every other Realtor is becoming a Bottomist…
“As for a rebound, ‘It’s going to be 2009,’ Mitchell said. ‘You’ve got a lot of inventory to work through.’ So what does this mean for real estate jobs? Mitchell told one story: ‘My daughter’s Realtor is becoming a phlebotomist.’”
“‘What’s happened is the people who bought on the high end can’t afford to lower their homes that much because they paid a lot for them,’ said Tom Maeser, a local real estate market analyst.
I need a shot of Febrese.
Before I read anything further.
Yah, and if they had bought, planning to stay there awhile, with a good down payment, and fixed rate loan, why would they be worried about selling in the first place?? Why would you buy if you were going to sell in just a few years?
What they paid for it really isn’t my problem. Just like buying used cars I expect a large discount.
“…can’t afford…”
Says it all. Those two words will disappear before long, probably next year.
“Senior VP Steve Ganzkow said no one has attempted this type of effort since the late 1970s to early ‘80s. ‘We’re dealing here with an asset class in the real estate world that is pretty new and unique to this market,’ he said.”
“Ganzkow suggested prices could range from $175 to $200 per square foot. ‘There’s a lot of people who would say for that kind of money I would go get a house somewhere, and you probably can,’ he said. ‘But then you wouldn’t be downtown.’”
Condos. Downtown Tulsa.
MORE FREBRESE, PLEASE!!!
When did downtown Tulsa become San Francsico or NYC ? Isn’t it kinda late in the game to be a dreamer ?
They built a Starbuck’s there you know. I mean jeeze, what else could ya want to make it just like Manhattan?
Tulsa’s not like the rest of the country. Haven’t you heard? It’s different there!
They’re livin’ on Tulsa Time - 2004.
“Zoe Cruz, co-president of Morgan Stanley and Wall Street’s highest-paid female executive, was ousted three weeks after the firm disclosed $3.7 billion of losses on mortgage-related securities at the division she oversaw.”
“‘I’m surprised, she’s been a big disciple of John Mack,’ said Douglas Ciocca, who helps manage $1.6 billion, including Morgan Stanley stock. ‘It may well be to satisfy the public’s need for scapegoats.’”
There’s no way that $3.7 Billion loss in her division had anything to do with it, surely?
Ms. Cruz was well compensated, so we’ll never hear her side of the story. FWIW, I see her in the same light as I see these generals that Bush has abused. Their careers are destroyed by those who issue the marching orders; being in the right place at the wrong time means falling on the sword.
“The NAR and Lawrence Yun, its new chief propagandist — er, economist — continued to fiddle and insist that all was well. Take a look at this ridiculous and self-contradictory release, titled ‘Mixed Results for October Existing-Home Sales; Mortgages Improving.’ The NAR follows that front-line fib with what I can only characterize as a big, fat, stinking lie. The first line begins, ‘Single-family existing-home sales were stable in October.’”
“‘Mixed’ results? ‘Stable’ sales? There’s nothing mixed about a nearly 21% drop from October 2006. There’s nothing stable about a housing inventory that has jumped 15.4% year over year, so that the months’-supply number screamed upward by 46%.”
Stable, in a Generalisimo Francisco Franco is still dead, kind of fashion.
The results are mixed compared to September, but I agree the awful YOY figures are being quietly ignored.
Slightly desperate vs Very desperate
“Still, he expects to purchase a place in the next year because his wife wants to start a family. He says he’s hoping prices will drop more by then. ‘In the last year nothing has enticed me to buy,’ says Matos. ‘For me, it’s just waiting until somebody gets desperate.’”
What is it with “I got to buy a house, because we are want to have kids!” I guess I underestimate the nesting instinct.
Agreed. Why do you need to “own” a house to start a family? All that 99% of new nesters own is debt.
“In the last year nothing has enticed me to buy,” says Matos, 48, who owns a kitchen cabinet business. “For me, it’s just waiting until somebody gets desperate.”
wants to buy a house.. wife wants to start a family.. all funded with kitchen cabinets?
a friend in San Francisco called me early this morning.. job is various remodeling /maintanance tasks for a small company, primarily within SF.
“Huh? you got laid off, eh.. bummer. They are downsizing the company?.. bummer.. 30 people laid off this morning?.. wow.. they give you anything besides a suprise kick in the ass? No? .. bummer.”
in the next couple years, a steady job tops the list of survival skills, imo.
Joey,
Bummer for your friend. I do feel for the worker ants losing their jobs. But this is only beginning. Without HELOC funds and the expectation of a quick buck selling… the remodeling rate will drop back down to what it was in 2001. Ouch…
How long before layoffs impact home prices? (I mean outside of Detroit.) It should begin to rock Florida, California, and DC by May or June in my opinion.
Got popcorn?
Neil
who’s losing their job in DC ?
1990-91 unemployment hit 6% ? here- feds never lay off and hired during the depression
no one complains ,they just BLOG
Neil,
The colleague who HELOCd POS condo at the peak for $500K and reinvested that amount in buying other Real Estate in other country, is asking what happens if he walks away from the condo?
Now I know why he is so relaxed. Is it that easy to just walk away from $500K debt(foreclosure)?
“Now I know why he is so relaxed. Is it that easy to just walk away from $500K debt(foreclosure)?”
It depends in what state he bought - is it recourse or non-recourse? If it’s recourse - the lender will come after his assets/income and generally clean his clock - unless he files for bankruptcy.
“It depends in what state he bought”
California!
What is recourse/non-recourse? Do they go after 401k?
Looks like he’s screwed - but his 401k is exempt.
Q 4. What is “nonrecourse” debt?
A Under California law, a debt is considered “nonrecourse” when a loan is made under either one of the following two circumstances:
(1) When the loan is made to purchase a one-to-four unit property and the borrower intends to occupy at least one of the units, or
(2) When the seller carries back financing for all or a portion of the purchase price of any real property.
(Cal. Code Civ. Proc. § 580b.)
In the event of default by the borrower, the lender, or financing seller, is restricted to recovering the property with no right to proceed against the borrower for any deficiency.
Q 5. What is “recourse” debt?
A Under California law, a “recourse” debt is one in which neither of the two exemptions in Question 4 occurs.
Examples of recourse debt are refinances of existing mortgages, home improvement loans, equity lines of credit, and loans, other than seller financing, securing a debt for purchase of property that is not an owner-occupied one-to-four unit property. The lender is not limited to taking the property back and the borrower may be personally liable on the debt. If the lender chooses to foreclose using a trustee’s sale, then the lender waives the right to go after the borrower for the deficiency despite the fact that the loan was a recourse debt.
http://eastbayplus.wordpress.com/2007/09/15/172/
I would have believed he bought in a state of greed, myself.
Neil - it is rocking Florida here and now. Big time. Closing prices astonish even me, and those affect the comps, so IMO the market is collapsing despite what the Pig Men are trying to pull off in NYC and Washington. It’s dead.
Ouch… thanks for the input Chip. What area of Florida are you in?
As to DC… even they had too many people working for the REIC. DC was hit in the “peace dividend recession” and the great depression. I’m not thinking they’re immune by any means.
Got popcorn?
Neil
And definitely a Steady Job would head up the list for
possible date or mate.
I would also ask if they were a regular HBB user?
that would definitely make them smarter, then it would be humor second on the list..cause ya need it.
Joey - you got it.
Amazing. We have all the as*holes from places like the NAR and the Mortgage Bankers Association, yada-yadaring on and crying to politicians about, “People losing their homes and need help.”
Excuse me! You realtors and mortgage brokers and realtorwhores were the bums who created this mess because of your greed after “Mr. Magoo-the-Enabler”, started giving away dollars. That was when the world wasn’t knee deep in dollars which were worth something then (Pre-Mr. Magoo) and are now confetti.
However, have no fear. These real estate related organizations have plenty of confetti money to throw around and I’m sure there are about 5 (minimum) busloads of politicians who will be, “Concerned about ordinary Americans losing their homes,” and can’t wait to stick their grubby little fingers into the bank accounts of brokerage, realtor and banking organizations.
Somebody should remind these politicians and mortgage brokers and realtorwhores that these houses the FB’s are losing are NOT THEIR HOUSES ANYWAY. They are property of those holding the CDO’s for 30 years.
I just found an old letter I kept from 2003. It’s from Lennar Homes dated January 3, 2003. Here is a snip from the letter:
Begin
As an interested prospective Cambridge buyer, it is important that you are aware of the method and process by which we will sell homes. We will be using a drawing process. Our drawing process is different from that used by most homebuilders in our area.
The next drawing will be held at 12:00 noon, Saturday, …yada yada yada… We, as the builder, will determine how many homes will be included in the drawing. Registration for the drawing will begin at 9:00 a.m.
Each person wishing to be included in this Oakwest drawing will need to be present at the drawing and submit their name in the drawing. Winners will be randomly selected. If selected, you will be able to choose a home from the available E.I. homes in the release.
Sinerely
Your Oakwest New Home Consultant Team.
end
Imaging those that went through this? Today they watch these same exact Lennar Homes going up only to sit vacant while yet another gets framed, another has the foundation poured, another lot gets graded, and another and another. THEN the builder puts a price tag well, well below the price that these people stood in some stupid Welcome Home Center hoping to have their names drawn so that they could “pick” whatever house Lennar was kind enough to build for them.
I knew the day I saw this letter that something was very wrong.
NMI — I think that before long it would be a lot of fun for you to post a copy of that (JPG or other) to a friendly local MSM site. That’s a real “feed the squirrels” moment.
Mexican Standoff Economy
Sellers can’t, buyers won’t and Jumbo the White Elephant, is squashing loans above $417K…
http://www.youtube.com/watch?v=nvuVYHMwZPQ
Costa Mesa CA nice looking house. Too rich for my blood but headed in right direction. That last reduction is a doozy, think thee bank got it??
Price Reduced: 09/03/06 — $799,999 to $759,000
Price Reduced: 09/27/06 — $759,000 to $750,000
Price Reduced: 11/21/06 — $750,000 to $725,000
Price Reduced: 04/03/07 — $725,000 to $705,000
Price Reduced: 08/05/07 — $705,000 to $699,999
Price Reduced: 08/15/07 — $699,999 to $680,000
Price Reduced: 11/24/07 — $680,000 to $550,000
sure looks like it, catspit
“The lenders will eventually walk away from them.”
Yup, exactly what I was saying a few weeks back when everyone was gloating over fines being levied against the banks for run down properties. Once the bank becomes the turnip there is no blood to squeeze out.
I’m old enough to have seen this happen before. Banks do not act logically, unfortunately. Often they will let a place go to ruin while it remains on their books. It will happen again, soon.
“As for a rebound, ‘It’s going to be 2009,’ Mitchell said…‘My daughter’s Realtor is becoming a phlebotomist.’”
Soooo…this person will become a ‘bloodsucker’? You mean, like a different sort of bloodsucker than they were the first time?
Actually, I have respect for phlebotomists. I bought about 35 percent of my college textbooks with plasma money, sucked out of my own girly veins. A good bloodsucker is a valuable being.
Baby Jeebus knows I sure shouted down the house when I didn’t feel my veins were being treated respectfully.
This has probably been posted already, but here’s the AP story about Paulson working with the industry on a loan plan. This is huge. I got a kick out of Yardeni calling it the “Teaser Freezer”. Hey, you go, Paulson! Hope the Goldman investors are happy you got them a rate of return they could have gotten on a savings account, with a lot less hassle. LOL!
http://sg.news.yahoo.com/ap/20071201/twl-subprime-bush-1be00ca.html
By MARTIN CRUTSINGER,AP Economics Writer
…
“People don’t want to tell there banker that they can’t pay,” he said.”
…
This guy is an AP writer?
‘It may well be to satisfy the public’s need for scapegoats.’
I don’t want a scapegoat who walks away with a $200 Million dollar parachute, I want assets seized at the very least and jail time when possible. It’s time we started holding highly paid people who lose zillions of dollars accountable and Employment contracts be damned. You want your $200 Mil Parachute for under performing ? Lawyer up and try and get us to pay.
And then what happens? And then the company pays her legal fees on top of the rest of it.. along with maybe some pain and suffering for the frivilous lawsuit. The contracts are pretty much bulletproof.
but whats the beef about people nailing a great job, negotiating a fine contract that guarantees something in a business where there are virtually no guarantees.. and coming away with a lot of money?
Would they pay $200 Million ? No, more likely they would settle out of court for a much lessor amount.
“but whats the beef about people nailing a great job, negotiating a fine contract that guarantees something in a business where there are virtually no guarantees.. and coming away with a lot of money?”
When the rest of us get similar terms for failure please let me know and then I might agree with you but then again I have too much pride to take money I haven’t earned.
Executive compensation is in the prospectus, so anyone who buys shares knows the deal ahead of time.
They buy because they trust that the company and it’s select, highly paid, extraordinary management are going to make money for them.
Would anyone with a brain buy shares in a company that’s run by some minimum wagers who barely passed the GED tests? No.
Everyone wants top-tier expert management with a proven track record and tons of experience. Such people are few and most are already employed elsewhere, so the price is high.
but sh*t does happen.. companies do lose money.. that’s the risk. Everything’s cool if the company prospers.
But if they lose money, and shareholders only then say that the executive compensation is not fair or too high?.. seems kinda lowlife to complain at that point, no?
Yeah really. It’s like an architect getting a bonus when the building he designs falls down. What, is their salary based on a percentage of what they lose for their clients?
That goes for ALL CEO scum.
Where is it that CEO types get ALL kinds of loot, in /out, around, and through the entire process and probably ten years later as well.
When will the shareholders,the smaller ones , say NO WAY?
Probably never.
These price drops are good for Long Island. If you make over $100k a year, think about how long you could keep your job if everyone making less than $80k a year left. You would be stuck doing (and getting paid for) low value work, or you would be unemployed.
I want affordable housing because I want to keep my high paying job. I am sure there is a moral argument, but there is a really strong greed argument for lower house prices.
“It can’t be all about me, me, me, especially at a time like this. These are difficult times and we’ve all got to pitch in together,” said Peter Sisung, 44, a Cincinnati designer.” To which I say BULLSH*T!
http://news.yahoo.com/s/nm/20071130/us_nm/usa_housing_hazard_dc
Aw Mo, let the FBs pitch in together…they’ll probably feel safer in their little tent city. They can’t all fit under the crumbling bridges.
Give them their neighbor’s house, or their own, until an OWNER OCCUPANT buys.
From a few posts up: “I’m old enough to have seen this happen before. Banks do not act logically, unfortunately. Often they will let a place go to ruin while it remains on their books. It will happen again, soon.”
Meanwhile, all those homeless ppl (well, the still-employed ones) will be competing with us for our next rental, groveling and probably offering top dollar while trying to stay 1 step ahead of judgements - if there’s any justice, they’ll only find themself in another foreclosure situation… (Rental contracts don’t survive the auction in TN, and I think most states.)
Deserving or no, I’d still rather see a homeless FBer put into an abandoned property than see it rot. Better still if cities or maybe individual neighbors could sue for something like eminent domain. Pay the property taxes on an abandoned home & I think it’s yours in…Florida? Cut/water the neighbor’s lawn, keep the A/C running some to fend off mold…it’s yours. In 3 months. Or you at least have the right of first refusal at a given price, whatever the bank can actually scrape up on short notice for the REO, with the caveat that it has to be a bona fide prospective OWNER OCCUPANT who has been background checked and fingerprinted and is locked into the offer if I, self-appointed house sitter, choose to pass. Of course, shilling needs to be a federal offense & ID fraud or theft a capital one, and bank is on the hook for damages if it goes empty again any time in say the next 3 years. Must have phone line, live aquarium (or similar attention demanding pet/hobby, stocked fridge on premises with lots of dairy not past sell-by date, and a live body who lists the address as primary on their tax return.
Sorry for all the CAPS shouting, but wanton waste & destruction in defiance of Free Market self regulation gets me real mad at those pinko socialist fund managers & investors and their mortgage co. henchmen. It may mean more $ for some lawyer than I would wish to stomach, but I am never doing my part towards snagging 22 MONTHS of house payments for an/a couple of agent(s) again. Ever. (That’s what 6% commission built into the financing of a 30 loan costs, at 7%, &NOBODY would deal with Realtors (TM) if they thought about it in those terms.)
California median price dropped 92 000 in 2 months.
Seriously this has to be some sort of world record.
Thats 1500 dollars/day for the past 60 days.
Truely mind boggling.
This is beyond frightening.
Seriously folks, but I’m starting to get scared.
Looks like my rant replying to spike66 got eaten, maybe just as well. In briefest terms: Give abandoned houses to the foreclosed, theirs until it legitimately sells to someone who will occupy, or let at market rent, meaning what somebody will and can pay.
Or give it to the first neighbor willing to step up and maintain the place for a time, keep the weeds at bay, at 20 cents on the 2005 dollar. (i.e. 80K for 2005’s 400K comp.) Another month with no REO sale, and it’s the neighbor’s for 15 cents on that dollar. And so on.
You can bust through the worst bureaucratic/contractual roadblock if the motivation (generally greed) is sufficiently great, so anything short of sweeping coordinated emergency action to save NEIGHBORHOODS (vs. imprudent buyers/lenders) is effectively a benediction upon the whole corrupt system of lending and packaging of loans that is in its death throes, and salting the earth behind it in what is sure to be unprecedented #s of communities. “We can’t save ourselves, so the houses can rot!” is the worst of capitalism and socialism combined. Makes jingle key-ers who *don’t* vandalize the place on exiting (they do TOO exist) look like sainted philanthropists by comparison.
Still kinda a rant. Ah well.
On the off chance that anyone needs to check a house price in the UK the following link may be of use
http://www.houseprices.co.uk/
I’ve had hours of fun comparing the real prices my friends and workmates have paid, compared to the sum they claim to have laid out. For some strange reason noone ever makes a bad deal. They must all be so much smarter than the rest of us.
“With Arizona ranked eighth in the nation in the number of foreclosures. . .”
Well, it has been raining steadily for about 20 hours in the Phoenix area. It has been quite a long time since we have had substantial rain, which is fairly normal for our climate. But I wonder how many of these vacant houses, whether pre/post foreclosure or just empty, are monitored for roof leaks, etc. I suspect that very few are. Unleash the mold.