A Sense That An Era Has Passed In California
The Sacramento Bee reports from California. “Happily shucking its farm-town image, Lincoln embraced suburbia during the Sacramento area’s great housing boom. Its population tripled. Master-planned communities sprang up and prices hit blue-sky territory. Then things went sour in what had been California’s fastest-growing city. Home sales fell, prices plummeted and foreclosures grew, just as they did almost everywhere in California’s interior.”
“Since 2000 Lincoln’s population has more than tripled, to 37,410. In 2006 Lincoln grew by 23 percent compared to its 2005 population, faster than any other city in California. In 2004 and 2005, it captured a resounding 43 percent of Placer County’s population growth.”
“‘We looked at it and said, ‘That’s the way Sacramento is growing, people will be wanting to move out there,’ said Evan Weinzinger, a data-center manager from Vacaville who bought a home for $508,000 in Lincoln two years ago as an investment with his wife, Angela.”
“Some 14 percent of the homes sold in Lincoln in 2005 were purchased by investors like the Weinzingers, who schooled themselves by attending real estate seminars and watching cable-TV reality shows like ‘Flip This House.’ They bought a home in Texas and one on Keswick Court in Lincoln Crossing.”
“The Texas property is doing well. But the four-bedroom home on Keswick is another matter. The Weinzingers never found a tenant for it, maxed out their credit cards to meet the $2,900 monthly mortgage payments and lost the place to foreclosure in March. It’s listed for $389,900.”
“‘It’s brand new,’ Weinzinger said. ‘No one’s ever lived in it.’”
“Keswick Court and the adjacent Keswick Lane are one of many lost precincts of Lincoln, neighborhoods that have become pockmarked with vacancies and ‘For Sale’ signs. More than two dozen homes are for sale or rent within a half mile of the Weinzingers’ place. At least a half dozen were foreclosed.”
“For now, there’s a sense that an era has passed. Current and former residents say Lincoln used to feel more alive, prosperous, teeming with young families.”"‘It’s kind of turning into a little ghost town, isn’t it?’ said David Ladd, who lost his home on Keswick to foreclosure in August. He and his wife moved back to Redding.”
“Josh and Tiffanie Marone are bewildered by what’s happened. ‘We’ve seen a lot of people come and go, which is sad – we just love this neighborhood,’ Josh said. ‘These are houses that sold for $500,000 to $600,000 two years ago. … It blows my mind that they’re just sitting empty.’”
“The Marones have put their house up for sale, too, so they can move to a rural setting in Loomis. They’re braced for a loss: The house cost them $529,000, plus $130,000 on a backyard pond and other upgrades. They’ve listed it for $525,000.”
“The downturn in Lincoln has been swift. Just 1,265 homes have sold this year, half as many as in 2006. Foreclosures have claimed another 217 properties, according to Foreclosures.com of Folsom. The median new-home price – $429,000 – is off 18 percent in two years, says DataQuick.”
The Novato Advance. “The sub-prime mortgage market crash has hit Novato hard, from the closure of GreenPoint Mortgages, one of the city’s largest employers, to increases in foreclosure rates. Real estate offices have predicted a decline in business, as housing prices have fallen.”
“But two responses by the federal government, a proposed targeted rate freeze, and new lending restrictions being reviewed by the Federal Reserve, offer hope to homeowners facing ballooning rate hikes, and of avoiding a similar market situation in the future.”
“Kevin Stein, associate director of the California Reinvestment Coalition, said that the current situation made some of the Federal Reserve’s restrictions on risky loans a moot point at present.”
“‘These loans are not being made so much anymore, as investors aren’t willing to buy them,’ he said.”
“Michael Conway, vice president of Mortgage Lending with the Redwood Credit Union, said a certain segment of housing-market losers were not covered by the Bush plan’s protections for a reason. ‘(The plan) is not an investor bailout,’ he said. ‘Nobody’s sympathetic to absentee landlords who bought (houses) with no money down.’”
The North County Times. “San Diego’s home prices tumbled more in October than those in any major metropolitan area in the nation. Prices fell by 2.6 percent from September, the highest month-to-month decrease of the 20 metropolitan areas surveyed for Standard & Poor’s Case-Shiller Home Price Indices. Local prices dropped more than 11 percent from October 2006, fourth-highest in the nation.”
“The local depreciation was less severe than just three cities: Miami, Tampa, Fla. and Detroit.”
“Eli Tene, founder of a Woodland Hills-based firm that deals in distressed properties across the country, said the biggest drop in prices has come since October and has not yet shown up on the Case-Shiller index.”
“A local home purchased in October 2006 for $500,000 would now cost, on average, about $445,000. Most real estate agents and analysts said they expect the decline to continue well into 2008.”
“The year-over-year fall and 2.6 percent month-to-month drop were both record declines for San Diego since Case-Shiller started its reports in 1988. It also represented the region’s 16th straight month of price decline.”
“‘I think San Diego is taking it on the chin, and I think we’ll take the hit hardest early and recover sooner, which isn’t a bad thing,’ said Dan Holbrook, president of a Carlsbad-based real estate consultant firm.”
“San Diego’s low-end homes — those priced under $462,003 — have suffered the most from the housing recession, dropping almost 18 percent over the last year. That means a home purchased for $450,000 in 2006 now sells for less than $370,000.”
“The index for high-end homes — priced more than $666,652 — have been the most stable, falling 5.8 percent over the same time, meaning a home worth $1 million a year ago is now worth a little more than $940,000.”
“‘Each month we look for a little bit of light at the end of the tunnel and it’s just not there. And the fact that we saw multiple new lows shows that we’re at the very least at the bottom or that we have not reached the bottom yet,’ said Maureen Maitland, VP of Standard & Poor’s index analysis.”
“Most real estate agents agree that prices will continue to fall through next year. Tene expects to see a larger decline in home prices than many agents’ forecasts: up to 20 percent over the next eight months.”
“‘It’s not like it’s getting better any time soon. Even when we get to the bottom, it’s going to be flat for a year or two. We’re really five years away from prices going up again,’ Tene said.”
The Fontana Herald news. “Land prices have plunged as low as 50 percent in some areas of the Inland Empire to reach levels not seen since 2002, according to a report released recently by The Hoffman Company, a leading land brokerage firm that tracks land values in the region.”
“In San Bernardino County, the smallest reduction in value is in Fontana at 27.1 percent and the largest is in Highland at 48.9 percent. The largest decline in Riverside County is a 52.1 percent drop in French Valley (near Murietta) and the smallest decline is in Moreno Valley at 36.1 percent.”
“It is not only outlying areas such as Hemet and Adelanto that are hard hit. Even in Corona, average lot prices have dropped from $300,000 to $180,000.”
“‘The decline in the price of land has happened rapidly; in the past two years we’ve lost five years of appreciation,’ said Norm Scheel, a principal with The Hoffman Company. ‘We may see prices drop a few more percentage points in the first half of 2008, but land values already have taken the ‘big hit’ and whatever comes next will be minor in comparison.’”
“In Riverside County, The Hoffman Company report shows values for finished lots have fallen from their 2005 highs by an average 42 percent, down 5 percent from a September report by Hoffman. In Corona, for example, values have fallen 40 percent from a $300,000 peak.”
“In 14 cities surveyed in San Bernardino County, the estimated lot values have fallen by an average of 37 percent. Chino shows a drop of 45.7 percent from the finished lot cost of $350,000 two years ago.”
“‘The value of land in California is being set by land investors and speculators,’ Scheel said. ‘After months of stalemate, it’s suddenly a competitive environment. The price expectations of buyers and sellers are much closer today than a year ago.’”
“‘Right now, most of the buyers are individuals using their own money,’ Scheel said. ‘They feel the land market could still drift down a bit, but the risk of waiting is greater. Getting in too late has them competing with Wall Street money that could run up land prices.’”
“A lot of attention has been focused on falling home prices and foreclosures, but that overlooks the other side of the equation, said Tom Dallape, the other principal of The Hoffman Company.”
“For example, finished lots in Fontana were selling for $240,000 at their peak and new homes were selling at $570,000, which was roughly 2.4 times the value of the land. Today, the estimated lot value in Fontana is $175,000. For a builder to realize the same profit margin, a home on that lot could be sold for $415,000.”
“‘That’s good news if you are a prospective homebuyer, but bad news for builders with existing lots and standing inventory, which also applies to homeowners who bought at the height of the market a few years ago,’ Dallape said.”
” schooled themselves by attending real estate seminars and watching cable-TV reality shows like ‘Flip This House ”
Got to be a joke. These programs are first-class mind rotters.
Now they’re getting schooled by market realities. I’m guessing this lesson is the one that’ll stick.
Experience keeps a dear school, but fools will learn in no other.
- Benjamin Franklin -
It’ll stick if the person renting the remaining “investment” property flies the coop.
Yeah, the only point of those things is to make money off of the fools. Wonder what the next get-rich-quick thing is going to be. How to get rich shorting stocks, perhaps? Of course by then, all the home builders will be bankrupt already.
I listen to KCBS during my commute, and there has been an annoying advertisement about “getting rich eventually” using the whatshisname method of investing during both up AND down markets. All you need is volatility!
Buy some Downey puts. Just a little nibble. Stock down .91 today.Beats Vegas and think of the gas and travel time you’ll save.
” schooled themselves by attending real estate seminars and watching cable-TV reality shows like ‘Flip This House ”
Even back when I was in my early 20s in the early 80s, I would have considered those real estate infomercials as pure scams. Whenever I came across the RE infomercials (”No money down!”) I would quickly change the channel on the remote. The shocking thing is that people were dumb enough to taken in by the fraudsters. The point is, the fraudsters were making money selling a system, they weren’t making money flipping houses. Why couldn’t today’s Fugged buyers even consider it? America is DOOMED by its lack of critical thinkers. George W’s cocaine into most people’s brains or something?
We need to call her Hillaryness’s broker at the CBOE to get some money down on cattle futures. Can’t miss on this one! Check it out with Suzanne!
“Property Ladder” is a much better show than “Flip that House.” It typically shows cocky, inexperienced beginners who ignore (Kirsten Kemp’s) sensible adice and get in over their heads. The show is also good about showing what happens when amateurs make elementary mistakes, such as not supervising the work personally, spending more than the neighborhood merits, and going for cheapest solutions/subconsultants that lead to expensive corrections later.
“Got to be a joke. These programs are first-class mind rotters”
That is why i cut my Charter cable bill down to just basic only after they kept jacking up rates for basically 99% garbage programming. I only regret missing out on espn and fox sports esp basketball but most TV fare pure garbage especially cable news networks.
Next step is to install an 8 ft antenna and get rid of cable bill entirely.
Just get rid of TV entirely. It’s done a world of good in my household.
Excellent advice. I haven’t watched a minute of the boob toob, other than the occasional Frontline or Nova episode on PBS, in more than two years and I haven’t missed it one bit. Its like quitting smoking. You feel the pangs of habitual desire for a few weeks but after that you wonder what people ever saw in the damm thing.
“Some 14 percent of the homes sold in Lincoln in 2005 were purchased by investors like the Weinzingers, who schooled themselves by attending real estate seminars and watching cable-TV reality shows like ‘Flip This House.’ They bought a home in Texas and one on Keswick Court in Lincoln Crossing.”
Just like I schooled myself on surgery by watching ER and Scrubs.
Well, *I* stayed at a Holiday Inn Express! So there!
Mac, Thanks for the Diet Pepsi through the nose!!!
ROTFL!
“For example, finished lots in Fontana were selling for $240,000 at their peak and new homes were selling at $570,000, which was roughly 2.4 times the value of the land. Today, the estimated lot value in Fontana is $175,000. For a builder to realize the same profit margin, a home on that lot could be sold for $415,000
- If you have never been to SoCal, Fontana and the Inland Empire are the armpit of SoCal.
For anyone to even imagine that a Fontana home would sell for 570k would mean that they were smoking crack.
And estimating a Fontana lot value in today’s market at 175K is clearly a marker for the use of hallucinogens.
“For anyone to even imagine that a Fontana home would sell for 570k would mean that they were smoking crack.”
Yep, that pretty much describes the majority of the townsfolk in Fontana.
Hey, shacks in Compton are still fetching $450K http://guests.themls.com/view_photo.cfm?mlsnum=07-212741
I particularly like that they gave up trying to put bars on the windows and instead just put bars on the whole house!
What are they going to do in case of a fire?
It would be more appropriately described as a cage. Can you imagine the realtor trying to convince the potential buyer that that neighborhood is actually pretty safe and that the bars were installed for aesthetic reasons. One can only imagine what crimes occured there to warrant that creation.
The upside is you can do your house arrest there with your ankle bracelet.
looks like some oddball whorehouse/jail or something. But I’ve been to Watts a few times …and thats pretty much not that uncommon.
“I particularly like that they gave up trying to put bars on the windows and instead just put bars on the whole house!”
Oh oh - here’s what the listing would say:
“…genuine steel throughout…”
“Hey, shacks in Compton are still fetching $450K ”
1116 n van ness off Rosecrans Ave. Good location. The street crips,bloods, and other homeys love standing around liquor store and assorted dives on major streets like Rosecrans. At least you can do a quick 5 minite getaway onto the 710 fwy for a quick escape , also a strategy used by store and bank robbers .
Pick your poison: 10 minite north is lynwood . 10 mintes east is paramount. All lovely hoods with endless views of barred storefronts with good chances to spot clusters of menacing homeys idling on streetcorners.
Club Rio, up Figueroa from Rosecrans is around there. I tended to like the gal named “Essence”
Only the long armed taggers can reach you
jjinla: I guess it would be the perfect house for a parloee adjusting to from a life behind bars.
Even the bars will not keep the bullets from zinging through the stucco.
“Even the bars will not keep the bullets from zinging through the stucco.”
New market… Kevlar lined drywall… capable of fire proofing… and proofing against small arms fire.
they actually do make ballistic grade drywall, its popular in guess where, LA! Rich people in LA make “panic rooms” out of it.
“Most real estate agents agree that prices will continue to fall through next year. Tene expects to see a larger decline in home prices than many agents’ forecasts: up to 20 percent over the next eight months.”
“‘It’s not like it’s getting better any time soon. Even when we get to the bottom, it’s going to be flat for a year or two. We’re really five years away from prices going up again,’ Tene said.”
Is Tene a lurker here?
“And the fact that we saw multiple new lows shows that we’re at the very least at the bottom or that we have not reached the bottom yet,’ said Maureen Maitland, VP of Standard & Poor’s index analysis.”
Somebody actually pays this dolt for her “expert” opinions?? This doesn’t even make sense. “Um, like, either prices aren’t going to drop anymore or, like, they are….”
Agreed, Maitland is one very stupid VP who says we’re “at the very least at the bottom” or we’re not. Brilliant. Add this dolt to the layoff list.
“And the fact that we saw multiple new lows shows that we’re at the very least at the bottom or that we have not reached the bottom yet,’ said Maureen Maitland, VP of Standard & Poor’s index analysis.”
Hee Hee - WTF!
California logic is a world unto itself. It must be a ‘right brain vs left brain’ issue - sort of like that movie ‘Liar Liar’.
Governor Arnold is a master of it, as our US Senators. They hold grand press conferences and make great proclamations of support and future change. Then John Q Public’s 4 second attention span switches to Brittanys little sister and ….
Quick, show me Brittany getting out of that car again! Huff, Huff.
OK….so Cali is number one! Congratulations!
Carry on…..
Not exactly. San Diego’s pants got pulled down after a swim and significant “shrinkage” happened. Unfortunately, we have a few more laps in the pool and during these winter months, the water is quite cold. Is this what they mean by having more “skin” in the game?
“‘I think San Diego is taking it on the chin, and I think we’ll take the hit hardest early and recover sooner, which isn’t a bad thing,’ said Dan Holbrook, president of a Carlsbad-based real estate consultant firm.”
So… first to take the hit [San Diego] and because of that… we’ll be the first to recover?
I don’t understand that logic. I would if I believed all regions going through a realestate boom-bust cycle occur at the rotational speed.. but I don’t.
Who’s to say SD got a flat with a big honking-arse hole… and it will take more time than elsewhere to fix?
“Josh and Tiffanie Marone are bewildered by what’s happened. ‘We’ve seen a lot of people come and go, which is sad – we just love this neighborhood,’ Josh said. ‘These are houses that sold for $500,000 to $600,000 two years ago. … It blows my mind that they’re just sitting empty.’”
“The Marones have put their house up for sale, too, so they can move to a rural setting in Loomis. They’re braced for a loss: The house cost them $529,000, plus $130,000 on a backyard pond and other upgrades. They’ve listed it for $525,000.”
When ppl make hasty decisions by doing things such as spending in excess of 100k for upgrades such as a pond, probably paid for out of home “equity”, isnt being upside down the expected outcome? If not, it should be.
we just love this neighborhood,’
disconnect. Why are they moving?
From the Sac bee article:
I notice that the Rodeo was put up for sale… but no mention of a sale. 
For years Lincoln was known mainly for Gladding, McBean, the 132-year-old maker of sewer pipe and other clay products located next to the old downtown. Motorists heading into the city from Rocklin along the main commercial thoroughfare are greeted by a 1940s-era rodeo stadium.
We’ll, don’t they just have it all. Jobs and entertainment!
My, the graph in the article on home prices just tells the whole story. 2 years of declining ‘values.’
Lilje and his pregnant wife just moved to Las Vegas for a job transfer. After 11 months of trying to sell their house, they decided to rent it.
Oops… buying in a transient job market doesn’t make sense… Ouch. I feel for this 2nd couple. Probably trying to do ‘the right thing.’ Oh well, lesson learned…
In two years, people will be shy on buying. Only then will I step out.
Got popcorn?
Neil
$120k for nonsense pure bling. All driven by the psychology of double digit annual appreciation.
I’m spending the holidays at my in-laws in Seattle. They spend $200k this year (originally estimated at $70k) to remodel their upstairs two bedrooms and bath. A couple of months ago when they got the bill, my in-laws felt cheated by their contractor friend. With the passage of time they’ve managed to convince themselves that (1) they had a very “special” remodel and the extra cost makes their house particularly valuable; and (2) their tiny 2/2 on Queen Anne hill is “worth” nearly a $1 million (because everyone wants to live on Queen Anne) so all the money they have dumped into remodeling (well over $400k now on a house they bought for $180k in the early 1990’s) has more than paid off.
Just another example–backyard pond, granite bathroom–of horribly misallocated resources in resonse to crazy price signals.
I have friends who go home and are hounded by stay at home spouses telling them how much happier their lives would be if they replaced their adequate countertops and appliances with granite and stainless steel after watching HGTV all day. Can you imagine being married to someone that wants a 100k plus pond installed, and then says Im bored lets move after it is completed? Some things are worse than death.
I’m a stay at home spouse. Who the heck has time to watch HGTV? (Must be no kids…)
And yeah, that is a nightmare of a spouse if their happiness rests on a remodeled kitchen instead of appreciating that they are free to raise the kids or live in semi-retirement.
I was married to such a stay-at-home spouse (we had 3 kids to boot). Fortunately, I managed to at least get even/split custody of them in the inevitable divorce. Of course, it cost me over $10K to get what should have been the default situation from the outset. Just thankful it wasn’t a worse custody judgment.
Her decision-making appears to be getting worse all the time. Apparently, according to what my kids tell me, she drives 20 min. out of the way (and back) JUST to get about $0.05 per gallon less on gas. Yes, she probably uses about 4 extra gallons in the process. It never ceases to completely confound me.
They probably came to the realization that they COULDN’T afford it - a bit late!- and decided they’d better sell ASAP.
In the meantime, our five-year-old carpet (4 dogs, 3 cats, and us) showed lots of dirt (we live in the country). For about $1500, we got Home Depot closeout laminate - nice stuff, at half price - spent a couple weekends, and voila! 750 SF of replaced carpet, for cheaper than it would cost to re-carpet, by far. Hard and fast rule in our house: if we remodel, it’s for US, not “because we’ll get it back when we sell.” Thus, paint cans appear, rather than slabs of marble.
Here we go with the day-ending Cally thread. Gott love this one. Fontucky strikes again.
Well this is the holiday season and it is CA related so I’ll share my anecdote with the group. As many of the oldtimers know, my BIL/SIL bought our house 2 years ago. BIL thought over summer about selling, but I guess he realized the door was closed on that. Well, he told me last Sunday that he hasn’t given up the thought of renting it out at 2500/month and buying a larger home. Just don’t get this guy. Call me the bitter renter, but he has a 1600 sq. ft. 3/2 home for 2 kids and 2 adults. What is up with the bigger home?
I guess it is all easy when your wife brings home the bacon working for CSU San Berdoo and you run a flea market stand/internet store 3 days a week.
When we first moved out here, someone told me California is a high risk economy. It’s true: high prices for everything under the sun, floods, fires, bad traffic everywhere you go, crazy people, nutburger politics…but when you work in technology and start to get up in years in terms of experience, you eventually end up here.
And we did. My wife has a Civil Service job and if it weren’t for that, we’d have left the state already. But since she has a pension and a guaranteed job, we have to stay.
[b]And so it goes.[/b]
The most plausible scenario is one in which California goes into fiscal bankruptcy. They say fifty percent of the residents of LA county are functionally illiterate in English. That would explain why there’s so little outrage at the financial situation the state appears to be in and the degree to which it is worsening. Yes…I know California has an almost unlimited ability to support debt because people come here from all over the world and we can just float more bonds and make it all better. But can we? If the property values are flat and the economy is flat and the voters (newcomers plus the rest) feel increasingly put upon because they think they’re paying for something (illegals) they shouldn’t be.
And I’d say that 99% are fuctionally illiterate when it comes to economics. I just spent a week down in So Cal. My bro-in-law had a big get-together one night and I held a captive audience explaining why all their hopes of a ‘08 recovery are F-ed. All were convinced after about 15 minutes. But the point is that it wasn’t complicated stuff I was tossing there way, just simple what-you-should’a-learned-a-long-time-ago basics.
‘They say fifty percent of the residents of LA county are functionally illiterate in English.’
- They neglected to say that 50% of LA County are probably illegal.
If the property values are flat and the economy is flat and the voters (newcomers plus the rest) feel increasingly put upon because they think they’re paying for something (illegals) they shouldn’t be.
Nope, that will never happen. The liberals that run this state think that illegals have every right that a tax-paying citizen should have. Voters have tried numerous times to cut them illegals off of services and every time, some moron from the ACLU blocks whatever law was passed by the voters from becoming a law.
C’mon, this is blatantly false.
Otherwise, how could AZ have cut the illegals off?
You’re telling me that some association (in this case, ACLU) is more powerful than Federal and State law? Gimme a break!
All you need to do is enforcement. The end. No more is needed. (And yes! I’m an emigre’ but a legal one.)
Go look up Prop 187 in CA. In 1994 the voters passed by a 59% margin a bill to limit services to illegals. It was immediately challenged in court and languished for years. The final death nell was when Gov. Davis stopped the appeal process, effectively killing the bill. There you have it, the will of the people was subjegated to a small but vocal minority and the activist courts in CA.
This would have worked, but instead we have the mess we are now living with.
But that’s precisely the point. This is the wrong model.
Cutting off services kinda raises the hackles (if you will.)
Just have an enforcement clause in employment. The services part will take care of itself.
How sure are you, really, that your wife’s pension will be fully funded when you retire?
Good question. Now’s not the time to be taking anything for granted.
“For example, finished lots in Fontana were selling for $240,000 at their peak and new homes were selling at $570,000, which was roughly 2.4 times the value of the land. Today, the estimated lot value in Fontana is $175,000. For a builder to realize the same profit margin, a home on that lot could be sold for $415,000.”
Can someone explain to me how the ratio of home price to land price is directly correlated with profit margin?
I think this is just a Knife-catchers ANALysis. Pulled from his ass and built on hope (lies) and dreams!
“‘The value of land in California is being set by land investors and speculators,’ Scheel said. ‘After months of stalemate, it’s suddenly a competitive environment. The price expectations of buyers and sellers are much closer today than a year ago.’”
“‘Right now, most of the buyers are individuals using their own money,’ Scheel said. ‘They feel the land market could still drift down a bit, but the risk of waiting is greater. Getting in too late has them competing with Wall Street money that could run up land prices.’
This has got to be Main Street Media B/S. What land investor and speculator uses his own money? Nobody I know speculates “using their own money”
Er, I agree that it’s clearly BS, but re: speculating with your own money, isn’t that what everyone with stock in their 401k is doing?
‘They feel the land market could still drift down a bit, but the risk of waiting is greater.’
About the same sense of urgency that a typical schoolkid might feel about his/her local McDonald’s running out of McSalads.
I think what he means is that the land is not useful as collateral and therefore one must use cash in order to outright purchase. Every large land INVESTOR (at least 100 acres simultaneously)I know pays cash for tracts of raw land, including myself.
$130,000 on a backyard pond and other upgrades.
Sheeeeeeeesh…why? And now they want to move. These Marones are flakes.
Hey, those koi ain’t cheap.
Heh. Koi. I had a boss once who refused to believe that koi=carp. Insisted they were like a totally different species or something. Last I heard she had quit her job to pursue her real estate investing career. Lol.
I’d make them rip out the pond or deduct $100,00 from the asking price just to get it off the property. Why would someone want a mosquito breeding ground in their backyard?
exactly
Hey a Koi pond is the new granite counter top.
How in the hell do you spend 130 grand in a tract home backyard?These people are so stupid it is pathetic.Easy come easy go I guess.
Gnomes?
You don’t spend 130K in a tract house back yard. It’s like adding granite countertops, and a tile floor in the kitchen for $15K. You do the work yourself or hire subs that don’t have licensing, insurance, ect..the $15K is a ‘wholesale’ price But then when you sell you advertise a retail price of kitchen with $45K of upgrades. Like the builders who include $100K in upgrades. Upgrades that cost pennies on the alledged dollar.
What a Maroon?
Whadda Marone!
How big a yard did these morons have and what exotic fauna did they plant? I could see $5K for the fancy pond, but what the heck did they spend the other $125K on? I smell something fishy here - perhaps a new car? pay off some credit cards? some other home improvement? maybe a vacation?
Seeds from Holland are expensive.
The Texas property is doing well. But the four-bedroom home on Keswick is another matter. The Weinzingers never found a tenant for it, maxed out their credit cards to meet the $2,900 monthly mortgage payments and lost the place to foreclosure in March. It’s listed for $389,900.”
“‘It’s brand new,’ Weinzinger said. ‘No one’s ever lived in it.
these people caught themselves a sword right between the eyes
“‘I think San Diego is taking it on the chin,…”
Yes.
“… and I think we’ll take the hit hardest early and recover sooner, which isn’t a bad thing,’ said Dan Holbrook, president of a Carlsbad-based real estate consultant firm.”
Thinking is quite distinct from offering unfounded opinions. Given that San Diego prices went up by more than almost any other city in the nation*, why would the correction here not be longer and deeper than in less overvalued local markets? I personally “think” that more overvalued places will take longer to correct.
* Major U.S. metropolitan areas with greatest percent appreciation from January 2000 through October 2007 according to S&P/Case-Shiller Home Price Index:
Area Percent Appreciation
—– ————————-
LA 149.5%
Miami 144.4%
DC 126.7%
SD 117.0%
Las Vegas 108.7%
Tampa 106.4%
NYC 105.5%
SF 102.0%
Phoenix 100.7%
Seattle 90.0%
Can’t you just let this guy dream?
–
You forget the fact that everyone wants to live in San Diego. Plus all the rich people in East Asia, Middle-East, etc., want to own a high-end condo in San Diego.
Ooops… the thinking didn’t materialize.
Jas
but there’s a ball park….. ooooow, aaaaaaah. That justifies a 700,000 2 bd condo where you get to sclep your groceries up the elevator in shifts, no thanks.
No, I did not forget the fact that everyone *wants* to live in San Diego. But I also did not forget the fact that many who *want* to live in San Diego (including myriad who recently achieved FB status) cannot afford to buy a home there.
“‘We looked at it and said, ‘That’s the way Sacramento is growing, people will be wanting to move out there,’ said Evan Weinzinger, a data-center manager from Vacaville who bought a home for $508,000 in Lincoln two years ago as an investment with his wife, Angela.”
“Some 14 percent of the homes sold in Lincoln in 2005 were purchased by investors like the Weinzingers, who schooled themselves by attending real estate seminars and watching cable-TV reality shows like ‘Flip This House.’ They bought a home in Texas and one on Keswick Court in Lincoln Crossing.”
Makes me smile whenever I read of a Vacavillian losing their shirt. Gawd how I hated living there, enduring ridicule the whole time for renting instead of buying into a bubble. I thought half million dollar homes in Vacaville were ridiculous, and these idiots went and bought one in Lincoln! Happy to hear their Texas property is doing well. That’s not going to last.
A Vacavillian. Sounds like a Dr. Suess chacter. I can hear him now….
I do not like a housing loss.
I will not have a real boss.
I cannot stand the thought of work.
That Ben Jones is a first class jerk.
I’m due a growing yearly gain.
I cannot suffer any pain.
Please buy my house before I scream.
For easy wealth is my true dream.
If you do not I’ll hold my breath.
For poverty is worse than death.
outstanding !!!
Anyone actually drive through Lincoln? We did a year ago. The town itself is pretty much as it was probably 50 years ago. But less than half a mile down the road is about the most monstrous, hideous, enormous development of tightly smished together houses I’ve ever seen. From afar its just insane to look at. They’re all built in a series of huge open fields with not trees. The homes are all the same general colors and the roofs are all made out of terra cotta shingles.
I cannot imagine living there. Anyone driving through Sacramento should just take a look at some of the horrendous masterpieces of Mcmansion development. Heck- just driving there is like driving to Disneyland. A full 100 miles out, billboards pop up with dozens of planned Mcmansion developments with happy smiling kids and puppy dogs plastered all over them. Sad. real sad.
“They’re all built in a series of huge open fields with not trees. The homes are all the same general colors and the roofs are all made out of terra cotta shingles.”
Sounds like Germany only without the historically interesting bits and the great beer.
Isabel
Anyone actually drive through Lincoln? We did a year ago
Sounds like a scene from the “Hills Have Eyes”
Many of those huge open fields without trees around Sacramento are flood plains, and the levee system in that area needs serious work. So many of these developments were such a bad idea.
I used to work in Lincoln up to 2002. Lincoln is nothing like it used to be. Heck, after working near the airport for nearly 8 years, I could barely find my way back to my buddys house who lived close to it. I remember the signs back before this all started, 120K NO MELLO-ROOSE. 98K 3/2. Those were some nicer built homes on decent size lots. I’m seeing those houses for sale now at about 260K-320K. Ah, those were the days…. when my buddy would give directions to his home, he would say “make a left at the old goat in the pasture”……….
“But less than half a mile down the road is about the most monstrous, hideous, enormous development of tightly smished together houses I’ve ever seen.”
Agreed. Out on Lincoln’s westside between 1st and 3rd streets one can find these tightly packed clone homes for droids. It’s hard to believe any city planning department approving these neighborhoods.
Too bad that the new overcrowded, illegal-ridden, polluted, OC-like SD is not worth moving back to, even when it gets as cheap as say, Austin, TX.
OK, then come to LA. We had an even bigger run-up than SD did according to Prof. Bear’s quote of the Case-Schiller numbers. See the Compton listing posted above for more info.
And we have better smog too.
Austin is growing less and less cheap all the time.
“San Diego’s low-end homes — those priced under $462,003 — have suffered the most from the housing recession, dropping almost 18 percent over the last year. That means a home purchased for $450,000 in 2006 now sells for less than $370,000.”
“The index for high-end homes — priced more than $666,652 — have been the most stable, falling 5.8 percent over the same time, meaning a home worth $1 million a year ago is now worth a little more than $940,000.”
Time will tell. Unless Congress sticks the U.S. taxpayer with the liability for guaranteeing the value of Jumbo mortgages up to $700,000, I predict the high end of the SD market has much farther to fall than the low end from this point forward. There just are not enough trust fund babies and millionaire corporate executives to populate all the inventory priced north of $500,000. And the vast majority of SD’s working population does not earn enough income to ever hope to pay off a loan in this price range.
My guess is that so little is selling at the high end at this point that it is very hard to accurately assess market values. However, as I posted in the bits bucket earlier, I see evidence that list prices have fallen by close to 20 percent in at least some high priced areas, and that homes are still not moving even after the big price discount, as they are still hopelessly overvalued at that level relative to current demand.
Do you know what’s the most scary about these drops? We’ve only just started with the “Low Tide”. And already, as you wrote, there are drops by around 20%. It’s really difficult to forecast how far this thing is going to drop.
We’ve still got a lot of time before the thing stabilizes. Next year should be even more volatile, from what we’ve seen.
Hard to tell.
I expect the pols to scramble like crazy to try to stem the bleeding from home market values in locales formerly referred to as a bit frothy. I expect these “Save Our Homes” programs to have little effect, other than to drag out the correction over many more years than otherwise would be needed.
test
What is the average airspeed of an unladen swallow?
46mph in calm air……
LOL!
the average cruising airspeed velocity of an unladen European Swallow is roughly 11 meters per second, or 24 miles an hour
What do you mean, an African or European Swallow?
–
“The Marones have put their house up for sale, too, so they can move to a rural setting in Loomis. They’re braced for a loss: The house cost them $529,000, plus $130,000 on a backyard pond and other upgrades. They’ve listed it for $525,000.”
After all the buying and selling expenses, some $50K, they will be down $184K IF they sell for the listed price. Unless they act swiftly the loss will be more than 50% of the original purchase price.
It is juts the beginning, folks. HBBers knew it for the past 3 years but the “news’ is getting to the rest.
Jas
Jas:
A HUNDRED AND EIGHTY FOUR THOUSAND DOLLARS…….
Imagine if they really had to pay that off……..over the next 20 years as renters!
I have to announce to everyone that for Christmas, my family got a new baby girl. We are naming her Ashley Noelle. She was born at 11:30 am on Christmas morning. Baby and mother are both healthy and well. And she will be taught proper things, as many learned from HBB.
congratulations, well done
need 2 leave ca-
Congradulations on your new daughter, Ashley Noelle . Mom and baby doing well is great news. Best to your family. Happy New Year.
“congratulations”-
Congratulations!
Many congratulations Need to leave CA and family!
I’m sure she will be taught proper things - but don’t forget to give her a birthday present and christmas presents, separately
Congrats!
And exactly! She’ll get one gift a year otherwise!
Seriously, that is exciting! Congrats!
Got popcorn?
Neil
Congrats!!!
Congratulations!!!!
Sincere Congrats Needs!
Beautiful name.
Leigh
Congratulations, need 2 leave ca!
May that your daughter always remain a sweet and precious gift; and the bonds of love always increase for your family.
What a gift for you! Kiss for mama and baby.
I’m so happy for you! Congratulations. Remember, kids don’t need to have their rooms painted pink or blue, they just need love, attention, and lots of kisses. All FREE!
congratulations!
Your job was easy - but kudos for your wife.
Congrats!
Congrats to you. I love Babie and little kids. They renew my faith in humanity….. I hope you find this out yourself.
A Christmas baby! Congratulations!!!
Congrats.
Wonderful news! Bright Blessings upon you all.
“Josh and Tiffanie Marone are bewildered by what’s happened. ‘We’ve seen a lot of people come and go, which is sad – we just love this neighborhood,’ Josh said. ‘These are houses that sold for $500,000 to $600,000 two years ago. … It blows my mind that they’re just sitting empty.’”
“The Marones have put their house up for sale, too, so they can move to a rural setting in Loomis. They’re braced for a loss: The house cost them $529,000, plus $130,000 on a backyard pond and other upgrades. They’ve listed it for $525,000.”
I’ll be interested to see what the market values the pond (and house) at.
By the way, Ben… another one of these NAMES… The Maroon family!!!
I suckamento!
I would pay 300K, but only if they can rip the pond out of the ground, and plant a nice lawn////////////
Actually, it’s (sorry!) Excremento! So named by my friend, who used to live in Utica, NY.
Moron is more like it..
While waiting at hospital, I saw one of the house flipping shows. Somebody bought a 800 sq ft POS in Sunland CA for $510K, then went way over budget (60K) and took 6 months for their ‘remodel’. The man bailed, leaving the female alone. I missed the end. But when such a small POS in an average LA area is that price, it should be SO OBVIOUS to even the most uninformed person that this is a bubble. I hope she (and he) lost their A$$es. They added 700 sq ft to make it attractive.
Saw this on Sacramentolanding. Unemployment approaching 10% in Yuba-Sutter. Parts of California really are hurting. I know Yuba’s never really had a solid economy, but this has got to be painful. Combine stuff like this with coming cuts in CA state spending, and 2008 is going to suck.
http://www.appeal-democrat.com/news/percent_58083___article.html/november_yuba.html
You know when a company lays off more than 50 employees the law say they need to keep them on the payroll for 3 months. I just went thru this with WMC Financial, the mortgage arm of GE. So many of the numbers won’t make it if the people were laid off in September/Octomber until at least the February statistics.
Marty
Marty
Thank you so much everyone for the nice wishes.
Let’s bring on more price declines. I want for my kids to afford to buy a house in the same neighborhood I live.
I want for my kids to afford to buy a house in the same neighborhood I live.
I wish more people had that attitude. Unfortunately, with the housing bubble there were way too many who only saw how much their house was “worth” instead of wondering who could afford it.
May I dredge up that overpaid (77K/yr) school psychologist Patty Marquez from yesterday who brilliantly bought a 600K townhouse with an I/O loan near Long Beach?
Recall: “After she bought the duplex, Marquez’s monthly housing expenses jumped from about $850 when she rented to $3,000. Marquez wonders if her house is mortgaging her future. ‘I don’t want to put a halt to saving,’ she says, ‘but I won’t be able to save as much as before.’”
Was this birdbrain saving $2200/month before? Talk about a negative savings rate. Not only will it be impossible for Marquez to save BUT her previous savings is also being vaporized to the tune of $4000/month - and that’s just using the conservative estimate of an 8% decline in home values in the area in 2008.
That’s a net dissavings of over $6000/month; in other words, if she had just quit her job and continued to rent she would have been financially better off. This all seems so extreme that the denial is almost understandable, even for a “psychologist,” but it’s actually not a rare picture of the fv$kups people have been making all over SoCAFL.
More ramen noodles, please.
net dissavings
Heh. I like weird terminology like this. “Negative appreciation” is another one I like to bat around. Just “fun” ways of saying - “I’m losing my shirt”.
At least her talents will be needed to explain to some SoCal kiddies why that tiger got all frisky up in SFO.
Anybody in a snarky mood?
Drop this dude a line.
http://dallas.craigslist.org/rfs/521133185.html
Penny Foreclosures? Lol.
A mix of sales and desperation in that post. Did the author realize that they were trying to sell properties while soliciting investors? (I assume to buy the homes, but man was that a poorly written Craigslist ad.) The poor attempts at FUD to sell were interesting.
Got popcorn?
Neil
For a late night laugh: http://blip.tv/file/520347
kids don’t need to have their rooms painted pink or blue, they just need love, attention, and lots of kisses. All
The house we bought in Albuquerque already had one bedroom painted pink. My oldest daughter (now 5) loves it. We give them the love. That is the real need, not a bunch of material stuff.
Congratulations on your new baby girl. You sound like you’re on the right track with your parenting ideas. I’m at the other end of the spectrum = finished being day-to-day parent. As much as I loved raising my daughters, it’s glorious to be back to being childless. I appreciate the peace and time so much more now. Enjoy because it goes fast.
I dunno…I know where you can get a sweet house with a koi pond.
Man I’d hate to see the wierd housing out on the West coast. No wonder the mountain states are growing. In our neighborhood there was an empty lot from a fire. The new owners (probably refugees from CA) built a huge looking McMansion that took up 99% of the lot. They stuck Roman pillars and painted it a funky gray color and the driveway is maybe 8 feet long. They probably drive Hummers too hahaha…
This explains why newspapers were cheerleaders to housing boom..
From FT
Subprime crisis hits newspapers’ revenues
The subprime mortgage crisis is tearing through the newspaper industry as US papers suffer sharp falls in real estate advertising.
The extent of the damage was visible this month when Tribune Co (NYSE:TXA) mpany, which owns the Los Angeles Times and Chicago Tribune, reported a 40 per cent decline in November for its real estate classified advertising revenues.
Gannett (NYSE:GCI) , the largest chain, said recently it was on track for a 27 per cent drop in real estate advertising for the fourth quarter after reporting a 23 per cent slide in the third quarter.
Heh. I like weird terminology like this. “Negative appreciation” is another one I like to bat around. Just “fun” ways of saying - “I’m losing my shirt”.
I wish it was ‘I lost my shirt and now my tits are out there for all to view.”
I went out with some “friends” a few days ago and we got talking about home prices. One of them lives out in Las Vegas and bought his home in ‘98…the other just bought a home with his parents (who live with him…and his grandmother who is most undoubtedly collecting SSI/SSA), wife and kid in Northridge to a tune of almost $750K for a 2200 sqft home. The third guy bought a place in Redondo Beach back in 2002.
It seems homebuyers definitely have a knack for justifying their purchases and making the people who don’t have homes try to feel very small. I know they all made money on their homes…..just on paper OR actual money that was then turned over to another home. I frankly can’t chaulk it up to anything but luck that they did succeed. I admit in some cases it burns me to see that they made such easy money at a time when my wife and I were struggling to make ends meet, keep a job, and save up for a house in the future (little did we know that Darwin’s Idiot Brigade would be out full force in the housing market).
Now these people are speaking volumes of hot air from places that the sun don’t shine. It saddens me that my wife’s and my own hard work has paid off with little more than a 1 bedroom rental…while others are enjoying their back yards, barbecues, and ill-deserved gains. With our combined incomes and no kids, I’m amazed at how difficult it is for me to justify paying $3K a month for a house while these others are owning two cars+, a home, 2-4 kids, etc etc …..what are we doing wrong? Yes….we have alot of money saved up but so what? I’m 37 now….when, if at all, are we going to actually get a chance to enjoy a simple beer in my own back yard?
It seems really pathetic to me that some people out there, who frankly I don’t think deserve to have what they have, are living it up and enjoying themselves. The guy in Vegas claimed his property hasn’t gone down at all…and he has well over $150K in equity. I stated that the crap will really hit the fan next year…he was adamant that it won’t because people like him are all waiting for the prices to level off and to jump back in and buy more properties.
How can first time homebuyers like my wife and I even compete? What’s really the point? Day in, day out I come to this forum and I read that there’s a 45% drop here, and there, etc…in places like Riverside, Chino, etc…places I can’t give a rat’s a## about frankly. So what to do?
Anyone who interprets what I have written as envy or jealousy has done so wrongly….it’s actually sadness and utter disappointment in the system, the way things are.
Eh. Life sucks. Have a beer. That’s what I do.
“Anyone who interprets what I have written as envy or jealousy has done so wrongly….it’s actually sadness and utter disappointment in the system, the way things are.”
Why is it the problem with the system? Everyone come through the same system and some are doing fine and other are not.. May be taking personal responsibility like we ask those f’d home owner would do wonder for your financial well being. If you are not happy with where you are financially, why not do something about it? Instead of spending time in reading this blog day in and day out, why not find a second job? Improve your job skill to make more money? find some way to save some more money or learn to invest and grow your money? It is useless to think other “don’t deserve” what they have. It is important that you find some way to get what you want. May be and just a may be, “they” work harder, invest better, saving more and spend more time doing rather than daydreaming about their future and they get ahead of the game becuase of that.
Maybe they are leveraged to their eyeballs like Stanley Johnson. You’ll have your opportunities in the next year or two. Enjoy sleeping at night without a $300k mortgage on a $200k house.
While your thoughts are noble, the practice of these people isn’t….that simply isn’t the way the world works. Just about everyone on this website knows that working HARDER doesn’t pay…working HONESTLY doesn’t pay anymore. While we wish that hard work and so on pays off, it doesn’t. Alot of people who made a bigload of money in the recent RE market didn’t even lift a finger.
I mentioned the system because the “system” is what ultimatelly allows people to do those things.
It’s okay to get down about it once in a while. I don’t think that the people this guy are talking about “got off their butts and did something”, it definitely had a lot to do with luck.
And frankly, enjoying their backyards? I don’t enjoy mowing watering weeding or landscaping. I wish I hadn’t bought a house with a back yard! (though we sometimes do have barbecues).
I think sanity will return to the market, even where you are, and you can reap the benefit of waiting and saving.
And I am sorry to hear that you are down today.
Sounds to me like they are most likely in huge debt.
It can be very trying to wait around for this housing market to crash. My wife and I sold our house last year and have been renting a small 2br home. We wanted to move in 2005 but even though we had a small 1,000sqft home to sell, everything was SO expensive it seemed crazy. So we stayed put, and last year we decided to sell for a profit (we had bought in 2002).
The past year has seen three people in our lives buy new, large homes. My brother bought one, my best friend bought one, and my boss bought one. We are talking 3500sqft+ McMansions. All but one of them were incredibly overpriced. My wife and I make the same incomes as the these people and I cannot fathom paying down a $900,000 house. Just the taxes alone seem insane. So we wait, watch and rent.
It can be hard to go over for a party and see the huge home theater they put in, or the wine cellar, or see five bedrooms for two people. But on the other hand, I have hundreds of thousands of dollars in the bank. They have hundreds of thousands of dollars left to PAY over the next thirty years.
The bottom line for us is to remember that everyone makes their choices and lives with the outcome. We have decided that we do not want to have tons of debt. We believe the market is heading downwards. So we rent a decent house in a nice neighborhood and wait. In the past year alone, the homes we were looking at have fallen from $750,000 to $650,000. That is a TON of cash. In our minds we were just “paid” $100,000 to live in a rental. Eventually the bigger house will be ours…just not the huge mortgage! Hang in there and don’t spend time worrying about what other people have. Sometimes they may have things (debt) that you don’t want anyway.
Also, there will ALWAYS be someone with more than you and there will always be someone with less. Try and live your life the way you want to and enjoy it as much as you can. It is yours!
You may find at that time, you don’t want the “bigger house” unless you have to entertain (there’s a business idea, anyone?). We’d rather retire that much sooner and enjoy our smaller house, on a nice little piece of land.
Cheers to all!