Going Through The Floor In California
The Daily Democrat reports from California. “The median price of homes in Yolo County has fallen by 12.35 percent in November compared to the same period in 2006, according to California Association of Realtors report. Yolo County homes are at a median price of $355,000, while in 2006, it was at $405,000.”
“In November and December, there has been a ‘pickup in buyer activity,’ with more homes being sold during that period than in any other months in 2007, said RE/MAX Woodland owner Don Sharp, who has been a realtor in Woodland for 29 years.”
“He said one possible reason for the spike in sales is that an increase of homes on the market has brought prices down. The supply-and-demand effect likely brought prices down to a point where they are once-again affordable.”
“There were 125 homes on the resale market in Woodland in mid-2005 and 425 in October 2007. Sharp said 350 homes were sold in Woodland this year, less than half of the 750 sold in 2005.”
“‘What it boils down to is there were a lot more homes for sale and the prices started going down,’ Sharp said. ‘Overall, in Woodland over a two-year time frame, we’ve seen the prices come down about 25 to 30 percent.’”
“In the Woodland market, for example, Sharp began seeing an increase in prices in 1997 that continued to rise until 2005.”
“‘It got to a point where people were having a hard time affording a home,’ Sharp said. ‘And pay rate in Yolo County and across the state just hadn’t increased that much, so it just got to a point where people couldn’t afford to buy anymore.’”
The Press Telegram. “It’s not hard to imagine a real estate agent somewhere in Long Beach saying: ‘If it can happen at Robert Weil Associates, it can happen anywhere.’”
“One of the city’s premiere real estate firms is closing its doors after 37 years, leaving behind a veteran staff and a long-standing reputation as a career destination for agents.”
“‘It’s very disappointing,’ said Pam Spoo, who has been with the firm for 23 years. ‘We were a boutique, stand-alone company. I would really call it the premiere real estate company in Long Beach.’”
“The downturn that’s now gripping the industry itself has one primary cause. Robert Weil, which often planted its flag on listings in communities like El Dorado Park Estates, Naples and the Virginia Country Club, recorded only about 20 sales for the past year, according to Spoo.”
“‘This is an extreme downturn,’ she said. ‘Buyers are very, very cautious about buying.’”
“‘What goes up must come down,’ said Long Beach real estate veteran Rose Voss, who described the market upturn at the start of the millennium as the best real estate conditions in her 30 years in the business. ‘Everyone knows real estate is cyclical. We saw this in the early 1990s.’”
“In 2006, there were 3,660 properties reported sold in Long Beach. This year, 2,557 sales have been reported to date, according to data from the MLS. And in December, a slow time in the housing market, there were 291 reported sales in Long Beach in 2006, while so far this month only 95 sales have been reported. The 277 sales reported in November 2006 were more than double the 129 this past November.”
“‘I certainly have been hearing anecdotally that either offices have been cutting back on agents, or in a smaller number of instances, I’ve been hearing about offices that have closed,’ said Robert Kleinhenz, deputy chief economist for the California Association of Realtors. ‘We’re seeing a number of Realtors who are either having to find another place to work or who are leaving the industry.’”
“CAR data show home sales fell more than 36 percent in November in California from the same period a year ago, and the median price of an existing home fell 11.9 percent. And that drop comes on the heels of a 9.9 percent record price decline in Octobe.”
“‘An 11.9 percent year-to-year decline in median price is the biggest year-to-year drop on record,’ Kleinhenz said.”
“‘How is it that all off a sudden, seemingly out of nowhere, we’ve seen this market turn on a dime?’ Kleinhenz said. ‘This market has behaved so differently from past cycles. In the ’80s and ’90s, the price declines never got as bad as they have over the last two months. Even at its worst in the 1990s, the median price only fell by 7.2 percent year-over-year - at its worst.’”
“Over the past three months, sales have fallen to a pace of below 300,000 units on an adjusted annualized basis, according to CAR.”
“‘Quite frankly, we think that the floor for housing market activity in the state of California is somewhere in the low 300,000 range,’ he said.”
“The number of Californians taking the test to become licensed to sell real estate has fallen considerably, according to the California Department of Real Estate.”
“There were 3,785 tests taken in October compared with 9,656 a year ago at the same period, and there were months last year in which the number of tests given numbered far more, according to the DRE.”
“‘A year ago we were giving 15,000 to 20,000 tests a month just for sales people,’ said Tom Pool, a spokesman for the DRE, the industry’s regulatory body. ‘Now the number of exams taken are going through the floor.’”
“People have been increasingly leveling charges against agents over mortgage issues, which come to the attention of the DRE only when an agent has had a hand in a fraud, such as over- or under-reporting the price of a home.”
“‘The nature of the investigations is clearly changing,’ Pool said. ‘Now we’re seeing more and more cases involving mortgage fraud.’”
The Desert Sun. “The Desert Sun Economic Index for the first time in 12 years shows that the Coachella Valley economy is slumping and job creation has virtually stopped.”
“The Index sank to 98.6 on a scale where anything above 100 shows the economy is growing and jobs are being created.”
“‘In all likelihood, job creation has stalled or actually turned negative and the direction is going down,’ said Esmael Adibi, director of the Anderson Center for Economic Research at Chapman University, who devised the index with the editors of The Desert Sun.”
“‘We haven’t seen the worst yet,’ said Bill Powers, CEO of Pacific Western Bank. ‘Many in the real estate market have to come to terms with reality.’”
“Powers predicted ‘we are still going to be in a funk for a while more,’ he said. ‘The problem is there are still a lot of people in denial who think everything will turn around after the first of the year and that’s just not going to happen.’”
“John Soulliere, CEO of the Coachella Valley Economic Partnership, said he was not surprised by the drop in job growth. ‘Our largest payroll gains for the last seven years have been in construction and now that is completely off the map,’ he said. ‘We have no idea when that will change.’”
The Ventura County Star. “At a time when homebuilders are playing it safe and in some cases halting construction, the developer of an ambitious Simi Valley housing project is moving ahead, banking on the improvement of slumping market conditions.”
“Casden Properties is outpacing most builders to get approval of a 266-unit development with affordable housing, senior housing and single-family homes. ‘Upon approval, we plan to proceed,’ said Darren Embry, spokesman for Casden. ‘We’re confident the market will adjust during our construction periods.’”
“But Casden is an anomaly when it comes to construction in Southern California, said a representative of the Building Industry Association.”
“‘For the majority of our members, they are in a holding pattern or have stopped mid-stream,’ said Terra Donlon, VP of government and public affairs for the Los Angeles and Ventura County chapter of BIA. Donlon said most developers are just trying to sell their current inventory before starting new projects.”
“Last month, Encino-based developer Larwin Co. announced that its high-profile 66-unit condominium development in Simi Valley will be put on hold. The Savannah project, now in its grading phase, is…by what is known as Happy Face Hill. It has been interrupted until at least March while the developer waits for an upswing in the housing market.”
“Larwin has another Simi Valley development that was approved, but construction has been put on hold.”
“Councilwoman Barbra Williamson expressed concern the Casden development might end up like the two Larwin projects. ‘With all that’s going on, the economy the way it is right now, why are they moving ahead when all others are backpedaling?’ she asked.”
The Bakersfield Californian. “The trail of troubled properties linked to the former Crisp & Cole Real Estate agency appears to extend beyond Kern County. At least one high-priced property in Fresno County’s mountainous Shaver Lake region was shuffled between a Crisp & Cole company and two former staffers, according to the Fresno County Recorder’s office.”
“The $1.3 million property was foreclosed on last month, according to records reviewed by Fresno County Assistant Recorder Gilbert Carter.”
“One-time Crisp & Cole salesman Jeriel Salinas bought the property…from Julie and Charles Farmer, and Aiden, Logan & Associates Inc., a company created by former Crisp & Cole principals David Crisp, and Carl Cole.”
“‘Find a life,’ Salinas said when asked about the foreclosure Friday. ‘Find something else to report about. Call everybody else who’s in foreclosure in Bakersfield.’”
The North County Times. “After losing their home to the Witch Creek fire two months ago, Jack and Mary Phillips have a new home before Christmas. The couple were able to trade their scorched lot and insurance payouts for free-and-clear ownership of their new Escondido home, using a program offered by Michael Crews Development.”
“Crews is one of several local builders who are adapting their business models to help fire victims transition into new homes. And for some smaller builders, the fires offer much-needed business as they struggle to survive during the housing downturn.”
“Michael Crews Development sold the new home for $699,900, and the company hopes to at least break even on the trade, said Mark Connal, sales director for Michael Crews Development. He said $250,000 of the sale was compensation for the burned lot. Whether Michael Crews can profit on the trade depends on the future market for a home on the lot.”
“‘It’s unfortunate that, as they say, the misery of some is the fortune of others,’ said Mario Landini, president of San Diego-based Innovative Development and Construction. ‘Business is way too slow versus the year before. If it wasn’t for the fire, I wouldn’t be meeting with anyone. It’s unfortunate, but it’s driving the business.’”
“Landini said he will rebuild homes at a 10 percent discount over his normal price.”
“On its face, rebuilding allows companies to offer reduced prices in comparison to new homes, said Nick Pappas, president of K. Hovnanian’s California Coastal region.”
“Because the builder does not need to worry about changing the land’s entitlements or building infrastructure, rebuilding a burned-down home can cost as much as 40 percent less, he said.”
“Single-home building represents a change in K. Hovnanian’s subdivision-focused business model, one that Pappas said will remain after fire victims are in their new homes.”
“And the housing downturn makes it easier to find construction workers. ‘Subcontractors want the work, desperately,’ he said. ‘When there was work going everywhere, (they) weren’t interested in doing one house, they were doing subdivision work.’”
“‘It’s unfortunate that, as they say, the misery of some is the fortune of others,’ said Mario Landini, president of San Diego-based Innovative Development and Construction. ‘Business is way too slow versus the year before. If it wasn’t for the fire, I wouldn’t be meeting with anyone. It’s unfortunate, but it’s driving the business.’”
Conclusion: Fires (and broken windows) are good for business.
The fortune of homeowners has been the misery of renters for the last seven years. It’s time for a change.
Agreed. Those that purchased at inflated prices had access to all the data regarding historical rent/income/sales price ratios they could want, and decided to purchase anyway. It was a risk they voluntarily chose. Those that rented because they did not want to take on such risk and debt, as well as those just starting out, couldnt save enough to even cover the appreciation during the bubble. The media is filled with stories every day now regarding ppl losing equity, but I dont recall much if any stories about those that were left out of the bubble and how much they were set back.
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One is man-made and other could be too.
Jas
There’s probably a number of people, in Florida, praying for a couple hurricane’s next year. After all it’s good for business.
Is that a corollary of James Q. Wilson’s broken window theory?
Arson = the next bubble
P’Bear,
Fires are costly, an maybe an easy out.
Costly - OMG.
No fire for you!
HA!
Luv ya dude!
Leigh
P.S. Yeah, I’m pulling your toes. Pinch.
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As per Radar Logic Data PPSF (price per Sq Ft) for Sacramento Metro area is down 23.3% from the peak during Sep’05. I think that this applies to Yolo Co. and many of the surrounding counties. Things are worse further south in Central Valley.
Jas
Merry Christmas Jas!
Gotta pull you toes too!
“No more speed, I’m almost there
Gotta keep cool now, gotta take care
Last car to pass, here I go
And the line of cars drove down real slow”
Radar Love!
Leigh
Sorry, Ben, I accidentally posted this in yesterday’s CA thread instead of today’s. Heretofore lies my rant:
A little OT but did anybody read in the paper (LA/OC area) that the Attorney General for Huntington Beach just got an unscheduled raise of 11%, only 3 weeks after she filed for bankruptcy? Her salary was raised from about $180k to about $200k.
She was quoted saying she was trying to have at least $36k in credit card debt discharged, though she said she planned on making good on her $60k in student loans. She cited her mortgage costs in her BK filing, too. Well, sell the house you freaking whiner!
What kind of lying whores are we here in America? Lying, scheming, cheating, filthy whores! She makes a shitload of money and she’s going to discharge her debts. Just to spice it up, she makes sure her fat raise comes AFTER she files for BK, so that the situation looks slightly more dire than it really is when the judge looks at it.
Friggin responsibility got tossed out the window years ago, I’m afraid.
A city has an attorney general?
Sorry, the city attorney.
She should be fired for filing Bankruptcy. No one should hold a city public servant position, when they fail to act responsibly in their private finances.
Half of the government in California and Florida will have to be fired ybthe time we hit bottom.
I hear ya. When we pulled in almost that much, we saved 50%of our net. Boy, what a narcissistic (got to live big to impress herself and others), irresponible brat. Can they re-open her case on the basis of delaying her raise?
Sure. Depending on when her BK was filed and discharged there may be a reason to file a motion to revoke her discharge or refuse to give one to her. When you file BK the “under-penalty-of-perjury” schedules mandates that you disclose any changes in the next 12 months. If she knew and didn’t disclose then may be a problem for her. However, as much as the United States Trustee dig through these cases, they don’t catch everything. I hold my clients to the ex-husband/wife standard whereby the ex-spouse knows EVERYTHING about your life and you lied to them, cheated on them, beat them up, and left them for the babbysitter. What would they call up the Bankruptcy Court and disclose that you haven’t? This ensures accurate and truthful petitions in my clients!
“…the Attorney General for Huntington Beach”
Wiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiipe OUT!…Surf’s up dudette!
At Ben’s HBB it gets better every day…
The city pays better than the state and there are lots more city attorneys.
Huntington Beach has notoriously dirty local leaders.
2 former mayors did time in jail (Garfalo, Houchen) and some of their staffers were taken down as well.
She was quoted saying she was trying to have at least $36k in credit card debt discharged, though…
How in the hell does someone do that sort of thing? I have a five-digit limit on the two cards that I use the most, but even then, I’ve rarely run the balance into four digits. The interest rate is just a little too high for me to be comfortable with carrying around a really large CC balance.
The bankruptcy “means test” was created for people like her. I hope the judge makes her pay back every penny.
HA!
Shows to go ya!
Man, Woman or child!
Call ‘em all the names ya want ~ greed = greed.
Is this why nice people finish last?
HA!
Shaking head - sigh.
Leigh
If the case has not been discharged, she will be in a Chpt 13 reorganziation. (Has to be - her income is way above the state median and she is employed - not a case of having had the income 6 months ago but now unemployed and in the hospital with cancer.)
She has to report the raise to the court. The judge and banjruptcy trustee will up her payments to creditors. Not reporting it would get her in a wowrld of trouble with the court and then with the state bar. (Besided it is public info and she also ran her mouth to the papers.)
Just spoke with my brother (Orange County Loan Broker0.
Plenty of product still funding.
You need FICO of 680 and you can still get NO DOC (Wells Fargo)
80 - 85% loan to value
100% loan to value with Full Doc
****Lenders are calling out ‘Distressed Areas’ **** specifically the Inland Empire, where values are like a falling star. These areas are requiring money down and low LTV like 80%
Eventually that ‘Distressed areas’ will include most of the South Bay! For you cannot redline…
I’m amazed the suicide loans are still out there… I guess the banks haven’t lost enough. Oh well… Credit is slowly and steadily tightening. Eventually they’ll require enough of a down payment to keep buyers from throwing the keys on the roof and walking.
Hence why 2008 gets this downturn going and 2009 is the power slide.
Got popcorn?
Neil
Just note the writers strike might accelerate things if it drags on for a while.
Aerospace still looks pretty strong but I expect a lot of the space contracts to get stretched out and extended.
Private contracts for airlines should continue but will be tough. Boeing should be in good shape with the weak dollar.
Aerospace still looks pretty strong but I expect a lot of the space contracts to get stretched out and extended.
Yea… but in LA, DC, and a few other areas its become so expensive its tough to hire. Expect defections to other regions. Let’s just say a little birdie told me to expect an announcement by April.
Lightsaber
you can get a no doc from wells but last time i checked your rate was 2 pts higher and you needed 25% down (jumbo loan)
NO doc loans where you put down 25% dont bother me. You actually have to put some skin in the game in this case to get the loan. Looks like lending is finally getting back to the way it should be.
No doc is for “self employed” right? Why should documentation be a problem anyway, unless you’re not reporting income (or don’t have any)?
That must be nice for self employed to not need to file taxes.
Yup, tax-free money! LOL
We’re both self employed, and send in our qtrly tax liability payments. We are screwed on the dual contribution to FICA (SS tax). Most self employed pay taxes, if they have a ‘real’ skill.
Death!
Death! (not to your brother).
Stop the insanity!
OMG.
Ya just can’t make this stuff up!
Leigh
er…Sobay…no harm intended.
My post landed in the wrong place, a thousand pardons.
LOs are offering toxic products! (nothing against your brother).
HELP! STOP THE INSANITY!
Sobay and bro, I’m speaking of the collective. It is getting larger by the hour.
Best Always,
Leigh
Leigh, put the eggnog down slowly and no one will get hurt.
“And the housing downturn makes it easier to find construction workers. ‘Subcontractors want the work, desperately,’ he said. ‘When there was work going everywhere, (they) weren’t interested in doing one house, they were doing subdivision work.’”
Yes! Time to take care of some deferred maintenance on the apartments. I need to replace some staircases, re-paint railings, etc. It’s been impossible to hire qualified labor at reasonable prices for the last few years, and materials have been way expensive. I’m making my maintenance budget for next year, and now I should be able to make some repairs and improvements.
What if the Doors had made a Christmas-themed medley of their songs?
http://vids.myspace.com/index.cfm?fuseaction=vids.individual&videoid=4253809
“‘Find a life,’ Salinas said when asked about the foreclosure Friday. ‘Find something else to report about. Call everybody else who’s in foreclosure in Bakersfield.’”
Aren’t we getting a tad testy?
another Crispy critter…
SD!
HA!
Find a life? C&C?
Ya…find a life you…er…go to jail!
Do not pass go, and no more $$$$$$ for you!
See how that life will suit you! grrr…
Not you SD.
“‘Find a life,’ Salinas said when asked about the foreclosure Friday. ‘Find something else to report about. Call everybody else who’s in foreclosure in Bakersfield’”
Large frozen carp to the head!!!
Leigh
grrr…
Construction jobs, probably heavily populated by off-the-books illegals, was the big employment driver & they’re not sure what’s next. How about foreclosure agents?
Here in Silicon Valley, they report population growth & job growth but, when you look closely, we have more people & fewer jobs than the touts claim. This probably means we have too a bunch of new illegals also. See the details at:
http://www.viewfromsiliconvalley.com/id377.html
Thanks!
WOW
Crisis may make 1929 look a ‘walk in the park’
http://www.telegraph.co.uk/money/main.jhtml;jsessionid=02ONRHC5RKDS1QFIQMFCFFOAVCBQYIV0?xml=/money/2007/12/23/cccrisis123.xml&page=1
The difference is that this time a depression would be much more comfortatble. Not comfortable, just more comfortable. I’m pretty optimistic in the long run because the global economy really needs a fresh start and the only way to get that is with an economic collapse.
Nobody is going to starve if it happens but we’ll need to rethink our love of inefficiency and shopping.
“…the only way to get that is with an economic collapse.”
What is it about “Human Nature” that you “understand” so well?
Human nature has already turned nasty in the “Land of the Wrong White Crowd”.
I am waiting to move into my next rental house which is a brand new spec house just being finished. I will be renting this 4 br 2 ba 2000 sqft SFR for $400/week. The investor probably would like to sell it for $549k or better, but there are no buyers at that price. The interest alone on your typical first time buyer loan would be about $1000/week, and PITI closer to $1200/week. That would be 96% of local pre-tax median family income - madness.
Anyway, my move in has been delayed. It seems that in this time of perfect prosperity in such an idyllic community (similar to Carmel, CA), cable thieves have ripped the street to house phone cables out. I’m glad the economy is so good, otherwise we might have a crime problem and civil disorder.
Meanwhile the assistant PM had to be helicoptered out of a Maori land repatriation ceremony gone bad. The Maori group getting the land was confronted by a rival Maori group that also made a claim to the land. No bloodshed - this time. In the 19th century, Maori vs Maori tribal disputes were settled with blood and followed by a cannibal feast. (To be fair, the Johnson County land war in the US west was the same thing, cannibalism only avoided by the abundant supply of beef.) I wonder how long it will be until history repeats itself?
So now, the Whores of Wall Street don’t trust each other? How telling! Must be, they all suddenly remember that the load of toxic sludge they desperately want to pump into their trading partners, is the very same toxic sludge that is already poisoning their partners’ balance sheets as well.
Financial AIDS, and not an effective condom yet invented. So for now, there is only the frustrating waiting for new, uncontaminated bodies and blood to fornicate with. Too bad their latest orgy has already infected everyone. Greed O Greed, what hast thou done?
“‘I certainly have been hearing anecdotally that either offices have been cutting back on agents, or in a smaller number of instances, I’ve been hearing about offices that have closed,’ said Robert Kleinhenz, deputy chief economist for the California Association of Realtors. ‘We’re seeing a number of Realtors who are either having to find another place to work or who are leaving the industry.’”
from the local press here in MA….Carlson GMAC is closing its Woburn headquarters, shuttering 14 sales offices and laying off 50 workers - the latest cutbacks to hit Massachusetts’ struggling real-estate and mortgage industries.
Just days earlier, mortgage giant Washington Mutual closed all seven of its Massachusetts offices, laying off 53 Bay State workers as part of a nationwide cutback.
Meanwhile, Mass. Assoc. of Realtors claim all is well. A North Shore office went as far as to say things are strong in their office, claiming to have sold more house this year than last. While that may be true, I find it hard to believe.
Median prices, average prices, whatever measure is used, I think it is impossible to say that a maarket is in good shape, as long as foreclosures are soaring and re/mtge offices are closing up. These types of businesses need very little capital to run. As long as some sales or loans are being made, the inflow of cash should be enough to keep them up and running. For offices to closing up, there must be very little business happening. Especially given that all of the pay for re agents and most of the pay for mtge brkrs is comission.
The more of them lie, the better. We don’t need any bailout when realtors are saying everything is fine.
IF HOUSES WERE FREE, YES FREE!!!!!!!!!!!!!
How many Americans still couldn’t afford to meet their monthly expenses if they had to pay property taxes, maintenance , and insurance.
Some data I read today indicated that the income of the average American family declined 2% between 2000 and 2006.
We know that expenses increased 100% or more in many areas during that same period of time.
We also know that many American’s have been treading water by taking out Home Equity Loans and Credit Card debt. The defaults on credit cards have been skyrocketing over the past couple months. We all know about foreclosures.
Is there any solution to this mess short of giving a free house to half of America?
“Is there any solution to this mess short of giving a free house to half of America?”
Just for giggles, imagine what that would lead to? My guess, $150,000 automobiles or maybe $10,000 cell phones. But it certainly wouldn’t lead to stability of any kind - just more bubbles.
Another sign of trouble? CC payments delinquent?
http://news.yahoo.com/s/ap/20071223/ap_on_bi_ge/credit_card_crunch
And I am about ready to be a father again. Wife now due any day.
And I am about ready to be a father again. Wife now due any day.
Congrats!! I hope everything goes well for you, your wife, and the new baby.
Congrat and best wishes.
Re the link. Lewis, CEO of Bank of America, was fretting that FBs were protecting their credit cards and walking away from their homes–something his models and his experience never expected.
Well, now they’re burning thru their credit cards, and those securitizations are facing problems like mortgage-bcked assets.
And, of course, Sallie Mae’s honcho,in his famous conference call, acknowledged student loan defaults are wreaking havoc on those securitizations as well.
Oh my.
Congrats N.L.2.CA, oops, was just going to post a tiny url to that article.
How about this nugget from that article:
“Economists also cite America’s long-standing attitude that debt — even high-interest credit card debt — is not a big deal.”
Oh yeah, which economists? What’s the source for this claim, AP? I was raised to abhor debt - and lots of you all were too.
Hey pigmen, the deadbeats you’ve been fleecing are about buckle! How many of those borrowers are quietly fretting about Janaury’s CC bill at this holiday’s parties? Now’s the time to close ranks savers - don’t buy their garbage - and drive a hard bargains for the good stuff.
Unfortunately the AP story does not provide enough hard numbers to really get a snapshot, but:
“The value of credit card accounts at least 30 days late jumped 26 percent to $17.3 billion in October from a year earlier at 17 large credit card trusts examined by the AP. That represented more than 4 percent of the total outstanding principal balances owed to the trusts on credit cards that were issued by banks such as Bank of America and Capital One and for retailers like Home Depot and Wal-Mart.”
This holiday season is looking like the last drinky before the bar closes for the FBs of America. A few days ago we read that credit card delinquencies were not a problem because it was easier to walk away from a mortgage that one’s CC debt. Now it’s starting to sound like FBs have been putting the mortgage payment on the CCs. When those babies reset to 36%, we’ll see smoking craters all over the landscape where FBs have augered in.
I guess if you’re going to BK, you might as well do it in style.
Bout says it all…
“The desires of consumers to want, want, want, spend, spend, spend — it’s the fabric of our nation,” said Howard Dvorkin, founder of Consolidated Credit Counseling Services in Fort Lauderdale, Fla., which has advised more than 5 million people in debt. “But you always have to pay the piper, and that can be a very painful process.”
The number of Californians taking the test to become licensed to sell real estate has fallen considerably, according to the California Department of Real Estate.”
You don’t say? And I was planning on taking my CA RE test so I could make a million there? Anybody want to buy the Golden Gate bridge? I am selling it for dirt cheap. LOL.
On Friday night, TNT had the movie, “Jingle All The Way” on, starring the Governator. He was going store to store fighting the mobs for some crappy sold out toy for his son. It was pretty symbolic of what all of this whole society has turned into. Chasing useless crap that nobody needs with money that they don’t have to impress people that they don’t like.
Thank you Vermonter Gal. I will post up baby stats when it happens.
“‘Find a life,’ Salinas said when asked about the foreclosure Friday. ‘Find something else to report about. Call everybody else who’s in foreclosure in Bakersfield.’”
Bakersfreid…the pesticide chicken’s have come home to roost!
The genetic offspring will be on sale after x-mas
“Michael Crews Development sold the new home for $699,900, and the company hopes to at least break even on the trade, said Mark Connal, sales director for Michael Crews Development.
Break even at $699,900…who exactly is SUFFERING?
I wanted to ask a question about parking money. If someone has 400K cash, what would be the best way to invest it in this market.
I’ve lost trust in housing and stock market. Also, all 401K etc. is also based on returns from the stock market. How would one of you invest it. Is CDs the only option? And some in Coverdell for kids.
Maybe you should invest some of it with Peter Schiff?? (www.europac.net)
Is foreign investment safe enough? With the US recession in sight, I think all the world economies will be affected. I feel that the stock markets in China and India are way overprices and their housing markets too.
If all you want to do is park the cash and make a little interest, I would have a look at the Vanguard Prime MMF. Pays better than most banks.
If you’re willing to accept a little volatility, I made almost 12% holding TIPS this year in Vanguard’s TIPS fund.
Both of these options are simple and painless to execute. Of course, this is not investment advice, YMMV, past results do not indicate future results … etc.
Simple,
post your question again in the bits bucket in the morning. some of the posters best able to answer–vozworth, matt, txchick, and hoz, among others-are around then.
Thanks, would do it tomorrow morning.
If you want safety, half in gold bullion and half in 3 month T-bills
a lack of trust in housing and the stock market makes a pretty tough sell….
Bill has it correct, T-Bills and Precious.
However, if you like the CD, build a CD ladder, but do it across currencies, with short maturities, roll from the Petro Shieks to the Asians, The US has not figured out who the boogeyman is yet, but when that is established the currency of the boogeyman will crack…
no more than 20% in the Precious….anyway you slice it,
When Hoz first starting posting here he called out UCPIX, it bottomed at 11 (read August top). I would go long that fund as it shorts the Russell 2000 Index…..Bear market is here.
Significant results in the shorts will be viable for the next six months…..but thats the Market….
what is money? a medium of exchange….the precious, time deposits, stocks, bonds, options, futures…..these are all money.
The things that are dying are Paper, Asset Backed Paper. If you believe inflation of the inputs (food and energy), and deflation of the wants (financed desires)… then the only strategy that works is lowering consumption and paying down debt….
The empire is crumbling and will go down the road of all empires.
“The average age of the world’s greatest civilization has been two hundred years. These nations have progressed through this sequence. From bondage to spiritual faith; from spiritual faith to great courage; from courage to liberty; from liberty to abundance, from abundance to complacency; from complacency to apathy, from apathy to dependence, from dependence back into bondage.”
Alexander Tyler circa 1787 re the
fall of the Athenian Republic.
made it this far? The reality is nobody really knows what a good investment is, its about sentiment…
personally, I think oil is gonna go to 130 a barrel. Interest rates are going double digits, gold could touch 2k in six months, dollar crash as China dumps the reserves and allows the yaun to rise…. this is the crushing blow to the American Consumer as inflation continues to surge…. but China only has a blip and America has a sharp and painful recession.
The juices really get going as market volatility increases, push and shove, only the weak will perish.
things to look for:
Commercial Asset Backed Securities to Crack…. this will be the failure that turns the recession to hard landing crash.
High Volume, Big Down Days…
Strong Intervention by Sovereign Wealth in Crashing Markets.
Lower interest rates Globally.
Lowered Consumption…
Lowered Expectations.
Increased Political Tensions.
FORCED LENDING is the opposite if FORCED SELLING?
another bubble, in the best of the worst places possible.
Thanks for the replies. Do you think CDs would be safe with 100K FDIC limit if I distribute the money in 4-5 national banks?
Or the recession could become depression?
Depends. (HA Aladin!)
Cigs, booze, food, ammo, gold, the most precious ~ protection.
Land, goats, family, friends, water, producive land (not in any order).
Goats: milk, eat stuff we don’t.
Land: trees, water, harvest.
Family (some); Friends: birds of a feather.
Merry Christmas!
Leigh
I have been trying to determine the same thing. For me personally I have concluded that cds spread out between banks (no more than 100k in any one institution as that is the FDIC insurance limit, and Im scared of bank collapses) is the best bet because regardless of what opportunities exist to day, in 18 months they will be much bigger and better opportunities for those with cash.
“‘We haven’t seen the worst yet,’ said Bill Powers, CEO of Pacific Western Bank. ‘Many in the real estate market have to come to terms with reality.’”
Feb march 2008 the real price tumble begins.
Unpaid credit cards bedevil Americans
http://tinyurl.com/2b6nsn
The value of credit card accounts at least 30 days late jumped 26 percent to $17.3 billion in October from a year earlier at 17 large credit card trusts examined by the AP. That represented more than 4 percent of the total outstanding principal balances owed to the trusts on credit cards that were issued by banks such as Bank of America and Capital One and for retailers like Home Depot and Wal-Mart.
At the same time, defaults — when lenders essentially give up hope of ever being repaid and write off the debt — rose 18 percent to almost $961 million in October, according to filings made by the trusts with the Securities and Exchange Commission.
Many will get new credit card offers in the mail and just keep spending. Payments be damned!
Where all saved the Seventh Consumers are here
http://money.cnn.com/2007/12/23/news/economy/last_minutue_shopping.ap/index.htm?postversion=2007122317
and a lot of indians are cheering them on.
I wanted to ask a question about parking money. If someone has 400K cash, what would be the best way to invest it in this market.
I’ve lost trust in housing and stock market. Also, all 401K etc. is also based on returns from the stock market. How would one of you invest it. Is CDs the only option? And some in Coverdell for kids.
The highest quality stock that I have found on the stock market is Berkshire Hathaway (BRKA and BRKB). The B’s are 1/30th of the value of the A’s.
Good topic Rex. There is the parking money for safety and then parking money for growth. I am closer to retirement, so I am in cash preservation mode - which is not very easy right now. Traditionally safe prudent investments are all suspect: I saw my large cap very conservative mutual fund loose 10K on 100K investement because it had 4% in stupid Citi. I also have AAA municipals. With the muni insurers (ambac mbia) going BK, those are potentially in trouble. So what is left? Money Markets? No. not until you make sure they aren’t vested in CDO’s and such, and many are. CDs? Yes, but make sure less than 100K invested at each institution to get the FDIC. And of course Treasuries are still safe (at least today). I am an extremely conservative investor, but suddenly I feel safer with GE, Microsoft, Oracle, Cisco, P&G, Bristol Meyers, etc. At least I know their business and what they invest their dollars in. Geez, what a mess.
That stock is really good but what if Warren Buffet tomorrow retires or tries to make a huge donation?
Is FDIC really to be trusted if there is say a depression?
Do they give the money back in a few weeks or few years?
Buffett makes donations from his own money, not Berkshires.
–
“Going Through The Floor In California”
First it goes thru the roof and then it goes thru the floor, nice way to wreck a house. Maybe, a state.
Jas
When BK laws were reformed in 2005, the quid pro quo was that the credit card companies would decrease usurious credit card rates and be more transparent about increases and helping people control their debt…
Well, surprise, surprise…that didn’t happen. Now that Citibank and its buddies are on the verge of collapse because of their lack of liquidity…needed to shield them from lawsuits and margin calls. All they need to do is have Paulson buy them time while they jack up rates and put the screws to the American consumer.
Everyone is moaning about how they don’t want to have a taxpayer bailout, but the average Joe will be paying his pound of flesh one way or another in 2008. Not only is buying a home a risky proposition right now, but so is having a large credit card balance.
Be careful out there this holiday season, people…
“Over the past three months, sales have fallen to a pace of below 300,000 units on an adjusted annualized basis, according to CAR.”
“‘Quite frankly, we think that the floor for housing market activity in the state of California is somewhere in the low 300,000 range,’ he said.”
Ok, I’m shocked there wasn’t a ‘click’ comment on recording this. I’m archiving this thread just for that one comment. Why can sales not get worse? Correct me if I’m wrong, but every quarter we see tightening mortgage rules. Only a little tighter each quarter, but the trend is to the buyer having to put more meat into the game.
Oh, I know of a few companies getting ready for some large moves. Yes, I’ve been saying that for a while (some have done the moves, in my own defense). I’m hearing of some decent size moves for Fortune 500 companies out of non-bubble areas. Yea, half won’t happen (that’s normal). But half will.
I see know reason that California couldn’t have a 200,000 sales year.
I don’t ever expect sales to go to zero… but they’re going to slow further.
Got popcorn?
Neil
Merry Christmas to everyone on the hbb!
Even in Los Angeles, now, the downturn is undeniable. My most bullish of friends on housing are either pessimistic or mum. I saw some foreclosures listed the other day with seriously reduced prices in nice neighborhoods, a few of them were near or over half off peak 2006 prices. These are singular data points, but with all the supply and lack of funds in the system, it is a sign of things to come.
Here’s where we all get patient and let the market come to us. I am positive this market will overshoot on the downside, just as it overshot the upside.
Happy Holidays to everyone and here’s to a great ‘08 on the hbb.
“How is it that all off a sudden, seemingly out of nowhere, we’ve seen this market turn on a dime?” Kleinhenz said.
Wow. This guy is either indescribably stupid, or full of crap.
According to this guy, it’s a “soft landing.” And, of course, now’s the best time to buy. *sigh*
Median prices are low and buyers are getting bargains amid high inventory.
And if people wait longer, they’ll get even lower prices and even better bargains.
“Unpaid credit cards bedevil Americans
http://tinyurl.com/2b6nsn”
Anecdotal, but at my job I’ve been seeing a lot of people applying for instant credit accounts and almost maxing them out the same day. I’ve also taken quite a few minimum payments on CC accounts with balances of 3-5k, and with department store interest rates that’s a lot of interest.
Germans anxiety about their economy in 2008:
http://www.dw-world.de/dw/article/0,2144,3019194,00.html
“‘What it boils down to is there were a lot more homes for sale and the prices started going down,’ Sharp said. ‘Overall, in Woodland over a two-year time frame, we’ve seen the prices come down about 25 to 30 percent.’”
Query - Because of the HELOCs and Refis, as certain areas start having declines in excess of 20%, I have got to believe there is a substantial number of homes with negative equity. I would be interested in looking at current charts showing average home equity considering all debt on the property nationwide, and for each of the major cities. Does anyone know if such charts exist and where I can find them. I have found some with old numbers, or those that did not consider all debt on the property. Maybe no one has access to all this info. I am real curious.