You Haven’t Seen Anything Yet In California
The Sacramento Bee reports from California. “One of the most turbulent years in a decade for Sacramento-area real estate ended in December with 2,440 homes changing hands in the eight-county region, the fewest sales since 1995 in some counties, according to DataQuick. Sacramento County’s median sales prices slipped to $280,000 during the month, down more than $100,000 and 27.6 percent off their August 2005 peaks. Those prices were the lowest since February 2004, DataQuick reported.’”
“The continuing decline in home values prompted Sacramento-based researcher TrendGraphix to declare December the ‘resurrection of the $200,000 house.’ The firm reported that 12 percent of the 13,994 homes now for sale in El Dorado, Placer, Sacramento and Yolo counties are priced below $200,000, with the majority being homes repossessed by banks.”
“A year ago just 2 percent of homes for sale in the region were priced below $200,000.”
The San Francisco Chronicle. “Bay Area home sales plummeted to the slowest December recorded in at least two decades, according to Dataquick. It was the 35th consecutive month of decreasing sales as foreclosures.”
“DataQuick said the December median was $587,500 last month, down 4.9 percent from $618,000 in December last year. It was an 11.7 percent drop from the peak median of $665,000 reached in July. For resale houses, the median dropped in every county except Santa Clara.”
“The difficulty and expense of getting ‘jumbo’ mortgages - those over $417,000 is clearly reflected in the sales results, which show 1,610 jumbo mortgage purchases in December, down 65.7 percent from December 2006.”
The Press Democrat. “Home sales usually slow over winter, but this December they nearly vanished. Only 188 homes sold in Sonoma County during December, about half the average for the month and the lowest since The Press Democrat began tracking the market 17 years ago.”
“The typical home sold for $466,500 in December, down 18.2 percent from a year ago and the first time the median fell under the half-million mark since May 2004. Prices have now fallen for 18 consecutive months, in year-over-year comparisons.”
“Housing peaked in August 2005 when the typical home sold for $619,000, ending an eight-year run when prices nearly tripled.”
“In Petaluma, Kevin and Rebecca Boesler have cut the price of their home 5 percent since listing it for sale in August. The 2,500-square-foot, four-bedroom house was originally placed on the market at $789,000. Hoping to attract a buyer, the Boeslers have reduced the price to $749,000.”
“‘It’s priced with the competition, but the market is just crawling around right now. I think the buyers are sitting on the fence,’ said Scott Rowlands, the agent from Santa Rosa with the listing.”
“The family hopes to sell so they can purchase or build a home on country property, Rowlands said. ‘So they’re willing to take a loss, but they’re going to buy something a lot cheaper than two years ago, if they can make it happen,’ he said.”
From CNN Money. “A former real estate appraiser for Washington Mutual is suing the bank, claiming she was blacklisted last year for providing a housing market forecast that was too gloomy.”
“Jeniffer Wertz says WaMu stopped accepting her appraisals in mid-2007 a month after she reported that her local housing market in California was ‘declining.’”
“But Wertz’s assessment shouldn’t have been controversial at the time. According to the National Association of Realtors, home prices in her hometown of Sacramento fell $9,000, or 2.5 percent, to $356,500 in the second quarter of 2007.”
“And most economists were already characterizing the housing market as a bubble that was ready to burst.”
“In the lawsuit…Wertz says she completed appraisals on two houses in May and then quickly got a call from a WaMu sales manager demanding she change her outlook to ’stable’ so a loan could be approved.”
“The WaMu sales manager also demanded Wertz change her appraisal process to produce higher prices for the properties she was evaluating, according to Wertz’s lawyer Stephen Danz.”
“When Wertz refused to comply, she claims the sales manager threatened to block her from doing future appraisal work for the bank. A month later, Wertz’s suit says, a third-party appraisal request assigner told her WaMu would no longer accept her work.”
The Contra Costa Times. “The early months of 2008 are expected to unleash more pain for a mortgage industry that has disclosed plans to shed more than 1,600 jobs in California.”
“Washington Mutual is among the companies that recently filed layoff notices with the state. ‘Some of them are home loan center jobs,’ said Gary Kishner, a Washington Mutual spokesman. ‘These were people involved in loan fulfillment. They did the back-end work for processing loans and things like that.’”
“Hundreds of East Bay workers involved in residential real estate transactions, financings or construction. ‘I’ve stopped looking in the mortgage area,’ said Victoria Christol, an Oakland resident. ‘With all the mortgage problems, the business is not the same as it used to be. Lenders are not issuing the same loans they did. You might find a job, but you can’t make as much money.’”
“She added that she has never seen the region’s mortgage market in such bad shape. ‘It’s going to get worse,’ Christol said. ‘You haven’t seen anything yet.’”
“Gina Cefalu, a real estate broker in Danville, said that a major rebound has yet to materialize on the horizon. ‘My sense is that this is going to go down further before it comes up,’ she said. ‘It does not look like it’s coming back this year.’”
The North County Times. “California’s economy will continue to slow, but maybe it won’t, or maybe it could tip into recession, a federal economist said Wednesday in a speech thick with caveats.”
“‘The good news this morning on the way in: oil, $90 a barrel,’ Gary Zimmerman, senior economist with the Federal Reserve Bank of San Francisco, said to tentative laughter Wednesday. ‘Who thought that was going to be good news?’”
“Zimmerman said rising interest rates could bode ill for construction and other industries that depend heavily on credit. Bank of Escondido Chief Credit Officer Mike Churchwell said the bank no longer loans to companies that depend on a booming economy to help them cover their debt, he said.”
“‘We don’t want to give people the rope to hang themselves with,’ Churchwell said. ‘We want to help clients make good decisions.’”
The Press Enterprise. “Home builders in the Inland region outdid themselves when times were good, and have built tens of thousands of homes too many during the last few years, a Philadelphia economist says.”
“In Riverside and San Bernardino counties, said Peter Linneman, principal of Linneman Associates, builders have erected 30,000 to 40,000 more homes than they should have.”
“Linneman said growth will catch up to the glut by year’s end. ‘It won’t necessarily return to crazy,’ Linneman said, referring to the double-digit annual growth in home values that took place earlier this decade. ‘This area came to believe that you couldn’t lose money in housing.’”
The San Gabriel Valley Tribune. “With fewer home sales, falling prices and economic uncertainty, this year’s housing market may get worse before it gets better. That was the message delivered Wednesday by the state’s top economist on housing at a monthly meeting of the Shorewood Realtors at the Manhattan Beach Marriott Hotel.”
“Leslie Appleton-Young, chief economist of the California Association of Realtors, blamed the credit crunch and buyer reluctance for a negative housing outlook for 2008.”
“‘I’m pretty sure we’ll be seeing a decline in the median in 2008,’ she said.”
“After statewide home sales peaked in 2004 and 2005, with each year hitting about 625,000 unit sales on an adjusted annual basis, the market bottomed out with 287,000 sales in 2007, Appleton-Young said.”
“‘I think we are just about, if not already at, the bottom,’ she said. ‘It’s not going to get much lower than that.’”
“The South Bay saw a 45 percent drop in sales compared with a year ago, according to CAR. Besides cities like Torrance, Hermosa Beach and Manhattan Beach, CAR’s South Bay figures include Long Beach, San Pedro and Wilmington.”
“The run-up in home appreciation created ‘a mentality that you cannot afford not to buy a home in California,’ Appleton-Young said, adding that now people have the opposite mentality.”
“‘You’re dealing with buyers now who are waiting until the end of the market downturn,’ she said.”
“Appleton-Young added some cautious encouragement for buyers: ‘No one rings a bell at the bottom of the market.’”
The Independent. “With some bitterness, condo developer John Blankenship declared to the City of Santa Barbara’s Planning Commission that he would not stand before them again.”
“After 37 years in the business, Blankenship said that he was defeated not only by a declining market and the subprime loan crisis, but by a city permitting process that prevented him from profiting on his projects.”
“It is the city’s loss, he added, because for the past couple of years Blankenship Construction has been one of the few still creating condos in the $600,000-$700,000 range — middle-class workforce housing, just like the city said it needs.”
“Blankenship and his wife, Hazel, continued to insist that they will not build, especially in light of the glut of low-end condos on the market in Santa Barbara: Currently 184 are comparable to those built by Blankenship. A few years ago these units were fetching up to $700,000; now they are going for $450,000.”
“‘It used to be worth it. An entitled property used to be worth money,’ she said.”
“Most of the buyers for their $600,000 condos were subprime borrowers, and although the last count shows a mere 41 homes in foreclosure in the City of Santa Barbara, compared to 450 in the Santa Maria and Lompoc area, the banks have stopped making those kinds of loans.”
“Consequently nobody, said Hazel Blankenship, including herself and her husband, ‘has the nerve to try to build.’”
Sorry to repeat a post from the bits bucket, but this international news item seems relevant here…
Recession looming in US housing-boom states
By Krishna Guha in Washington and Matthew Garrahan in Los Angeles
Published: January 16 2008 22:08 | Last updated: January 16 2008 23:39
California and Florida – the biggest and fourth biggest state economies in the US – are either in recession or on the brink, many economists now believe.
While state-level data are patchy, the available figures suggest that economic activity is probably contracting in Florida and may be declining in California as well.
http://www.ft.com/cms/s/e3d4086c-c47b-11dc-a474-0000779fd2ac,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Fe3d4086c-c47b-11dc-a474-0000779fd2ac.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fus
Link to full version (w/o subscription gatekeeper):
http://www.msnbc.msn.com/id/22689098/
this is ‘news’? recessions been here for months
lol
We only just found out yesterday, thanks to Jas.
I had no idea.
Dude, you had me laughing yesterday, now you’re just being plain mean…(and I love it!)
ROTFL
aladinsane’s comment yesterday had me bust a gut. Well played. We’ve discussed this downturn for a while, so none of us are surprised (yes, I was relative latecomer, but I’m certainly not a newbie. I started lurking 3Q 2005, started my own blog May of 2006).
But I’m thankful for over two years of knowledge. I’m finding well aged Schadenfreude is the best.
The first “Got popcorn?” post I could find was January 6th, 2007. We should celibrate one year of popcorn!
Neil
“The San Gabriel Valley Tribune: A recession is defined as two consecutive months of negative GDP growth.”
How about two consecutive quarters of negative GDP growth?
January 6th? You must have had an epiphany.
–
You underestimate the stupidity of economists, especially, at the Federal Reserve.
We will officially not be in recession until 2008Q3.
Jas
Then all of their talk will be about “recovery”. Economists are the masters of not seeing the forest for the trees. It seems like they still haven’t figured out that inflation can be caused by high food and energy prices, not just low interest rates.
No, inflation is caused by two much money. High food and energy prices are the symptoms, not the cause.
California and Florida – the biggest and fourth biggest state economies in the US – are either in recession or on the brink
The data I have looked at here in Florida clearly looks like Florida has been in a recession. Even tourism is taking a big hit right now.
I saw an article in the Sarasota paper today about all the restaurants that are closing or have closed. I’m looking forward, with the same kind of macabre curiosity that someone views a fatal car accident, to our annual trip there later this month.
Enough about Florida, back to the California topic.
Yesterday’s paper had a big article about a restaurant closing in downtown Tucson. Well, TTYTT, this place was so badly run that only a miracle would have kept it going.
OTOH, I went to lunch at another restaurant today. The joint was jumping, let me tell you. Great food and fabulous service. (It’s the Guadalajara Grill, where the salsa is to die for.)
What’s that Mexican place where they serve the jicama sticks in a red plastic cup with the pico de gallo? It’s unreal.
There used to be a restaurant in Tucson with belly dancers doing their thing, as you dined.
Still around?
Sorry to say, the belly dancer restaurant closed. But it was good while it lasted. (Went there for lunch once. The dancers performed during the evening.)
I believe they’re still shaking it at Cedars of Lebanon Restaurant in Salt Lake City, UT.
Mormons know how to have a good time.
I know about a strip club that serves lunch……we used to call the lunch special “Burger with Thighs”…..:-)
I don’t miss Tucson particularly but I do miss the food, especially the carne seca and El Charro and the huevos rancheros at Tohono Chul.
Tourism is definitely down in New Zealand. The HELOC money that Americans formerly used to pay for their vacations is gone. Even local spending is down at cafes. The realtor/builder/mortgage broker money has dried up so the big spenders are cutting back.
Kudow & Co last night.
- He had a guest that said that the nations growth from the last
Ten Years was the result of LEVERAGE.
The US had no real growth in high paying jobs or production.
The growth came from companies leveraging stocks and from housing leverage of price increases.
He predicts very very low Mortgage Equity Withdrawal this year that will remove one trillion dollars from the economy.
J6P is done - like cooking wieners on the grill. But now he is a Luau pig buried deep in the sand, slow roasting.
This on Goldilocks and Company? You know it must be bad!
The Goldilocks Luau Pig! GLP - LOL!
The thing about leverage is: It cuts both ways.
Hark, I hear the sound of Ben’s helicopter’s engine warming up and getting ready to take off!
http://biz.yahoo.com/ap/080117/economy_stimulus.html
How will a one-time $250 tax rebate square with home prices that are falling to the tune of $9000 or so per month (at least for the owner of the median-valued San Diego home)?
“How will a one-time $250 tax rebate square with home prices that are falling to the tune of $9000 or so per month (at least for the owner of the median-valued San Diego home)? ”
Case of Jack Daniels???
$250/month might help, but one time $250 is not going to make much difference to the average family unless it’s $250/person. Even that as a one time deal won’t really spur much spending IMHO.
It would help me buy a couple of things I’ve needed for my business.
Ours will go to dog rescue.
Dogs rule! We have the *best* rescue dog ourselves. My $250 is going to dog rescue too.
I am buying forex. Damned if I’ll be compelled to “stimulate” the economy. Is that the best we can do? Hand consumers more cash, just like they extracted cash w/ home equity loans?
I’m going to hire some illegals to uproot some fresh JT’s. 50 bucks a day x 5 wabbies = no economic stimulus for you!!
Oh my friend,
I think that will creat quite a ’stimulus’.
The Realtors ™ and FB’s won’t forget you and that’s $250 bucks of tax free Cervesa!
Got popcorn
Neil
hey, bernanke gets my vote now that he gave me some chewing gum $!
oh wait, i cant vote for him?
$250 rebate for Joe Sixpack - buy some crap he does not need and billion dollar tax cut for the top 99.99%
I’m thinking J6P is gonna blow his $250 on about 44 Sixpacks of beer.
with the low supply of hops now he cannot even get that!
Well, 86 bottles of Mad Dog 20/20 then.
woo-hoo! I’m in the top 99.99%!
Exactly.
$250 towards an iphone with the remainder going on credit card.
Thats right. Funnel that money into the asian market so they don’t have to buy our property.
J6P will spend it on Hookers, they in turn will spend it on crack. The drug dealers will then convert it to Euros or some other currency that has value. Net value to the US economy…zero!
LOL This J6P is going to spend it on a new 3wood and golf shoes.
OK, how about this for a stimulus. Have the gov auction off $5T worth of housing coupons. FBs could buy them to pay off their loans. Banks could buy them to write off their dud loans. Homebuyers could purchase them to buy a house with.
It wouldn’t put money in people’s hands to fuel commodity inflation but it would break the logjam and get houses out of weak hands and into strong ones.
where would the FB’s get the money?
They would put $5T worth on the market, but would only receive $2.5T for them. FB still F’ed; banks still caving.
…or, prices could be lowered for properties..?
We need a national lottery!
…can I have my $250..?
Booze and VEGAS BABY !!!!
Well, this Joe Sixpack will probably invest the $250 in more puts or short ETFs! Woohoo! Yay kickass!
“DataQuick said the December (Bay Area) median was $587,500 last month, down 4.9 percent from $618,000 in December last year. It was an 11.7 percent drop from the peak median of $665,000 reached in July. For resale houses, the median dropped in every county except Santa Clara.”
July Median = $665,000
Dec Median = $587,500
12 - 7 = 5 months
Annualized rate of recent Bay Area median sales price decline:
((587.5/665)^(12/5)-1)*100 = -25.7 percent per year.
Is anyone still talking about 10 percent overall declines?
Oh, I’m sure all the Bay Areans will brush this off. “Wait ’till the spring bounce”, they’ll say. We won’t see real panic until mid-spring, when there are still no sales.
I’m guessing that’s July ‘06.
Still … let’s have fun out their Bay Area!
I mean “… there, Bay Area!”
I liked it better the first way.
“Hey, blow it out your bay area, buddy!”
“…down 4.9 percent from $618,000 in December last year. It was an 11.7 percent drop from the peak median of $665,000 reached in July.”
The wording is a bit unclear, but since only “last year” is mentioned, I am inclined to assume you are wrong on your July ‘06 guess. However, I am interested in confirming evidence if anyone can produce it…
“It is the city’s loss, he added, because for the past couple of years Blankenship Construction has been one of the few still creating condos in the $600,000-$700,000 range — middle-class workforce housing, just like the city said it needs.”
$6-$700,000 is middle class workforce?? Well I would say is really is different there… As in completely detached from reality. Wow!
Wow is right…..totally insane. Unbelievable.
“creating condos in the $600,000-$700,000 range — middle-class workforce housing”
He is freaking insane…workforce housing my @ss.
So how much does a county cop with, say, five years experience make in California? And school teachers?
Well… There’s billboards all over Oakland for the police department looking for people. The billboards mention the starting starting salary of 70k. So 100k I imagine for a seasoned cop? It would appear that either California needs more cops due to more crime or that there’s a shortage of cops because most skipped town since 70-80k doesn’t get you squat in the Bay Area.
Every single city I’ve driven in CA over the last two years has the same billboards. That’s very telling.
A cop in Oakland with 5 years experience makes like $80k. They’re the highest-paid cops anywhere. Teachers get like $32k and have to live in co-ops.
The real money in California as far as vast numbers of people on the government dole, comes from the prisons.
Why do you think we have 750 per 100,000 of our citizens in the calaboose, compared to England’s 148 per 100,000?
My SIL is a public HS teacher with about 3 years in and makes about $50K/year. Of course after graduating UCLA he had to do some convoluted program that took him nearly 3 years to become certified. My daughter gave up on certification because she desperately wanted to teach middle school math, but because her degree from UCLA is poly sci, NCLB doesn’t allow her to teach math. So public education loses out on someone crazy enough to want to teach middle school in a subject they desperatey need and she now teaches at private school. And they both have what I consider epic ($20K combined) student loans they are paying down.
Comment by Big V
2008-01-17 15:04:46
A cop in Oakland with 5 years experience makes like $80k. They’re the highest-paid cops anywhere. ____________________________________________________
Cops in Nassau/Suffolk County, NY with five years on the force typically makes well over $100k.
Cops in Oakland have high life insurance expenses…
20k in student loans is epic? Maybe back in the 80s but now? 20k is getting off easy. What I paid off after 8 yrs (graduated in 93) would give you absolute nightmares.
And they will make that for life at retirement! (NY Income tax free, as well!)
D Jane - they consider it epic becasue both are in mid-thirties - they chose to go back and finish college when they discovered late 20s that their parents weren’t as stupid as they thought when they suggested going to college instead of working right out of high school.
same, I had a BA that wasn’t cutting it and went back for 2 more years under and then grad school. I was in my early 30s when I finsihed as well so very similar. Paid off my loans with my dot.com wages. Probably the only smart thing I did during those booming years.
In california, newbie prison guards with a high school diploma make more money than assistant professors at the University of California. Compare the level of education and talent and effort.
The state is thinking of cutting off UC entirely from public money. They’ll have to get it all from fed grants (getting harder and harder) and tuition charges and donations.
Prison guard union is insanely powerful and responsible for enormous destruction of wealth.
They always support ever “tougher on crime” sentence increases, so there is more demand for prison guards. This way there are more guards and lobbyists and union members to push for legislators who keep doing that.
My moment of truth came when I was picking up some dry cleaning in the Central Valley…
As the clothes were cycling through to my items, about every 13th item was a prison guard’s shirt, or jacket.
U.S.: leveraged economy.
California: prison economy.
What’s up with UC? My husband is about ready to take a job up North with UC (Bay Area) - is this OK? Should we rethink it?
UC will be stable enough. They’ll first cut ’slots’ and then offer early retirement. Will they raise tuition? I think so. So much for having the best public college system in the world… I think you’re ok. Its the kids that will suffer (more per classroom, higher dorm fees, etc.)
Got popcorn?
Neil
In california, newbie prison guards with a high school diploma make more money than assistant professors at the University of California. Compare the level of education and talent and effort.
————————–
With all due respect, I keep seeing posters denigrate what cops, firefighters, teachers, prison guards, etc. do — claiming that they are overpaid and underworked.
Might I suggest **you** sign up for the job.
Get back to us in a year to tell us how overpaid you are.
No offense, but I have the distinct feeling you’ve never had to personally deal with the evil trash that is housed in our prison system.
I wouldn’t do it for $500K/yr. and am happy to pay taxes so those who are willing can be compensated for their work.
My father and FIL were both college professors. They had the best jobs around, IMO.
Thanks for the response Neil!! We will miss your blog parties! This happened so quickly - he starts his job the beginning of Feb. Now it is my turn to find a job up there (may take me up to a year to find what I want, but so be it). Now we will have to wait out that crazy market which has much, much further to fall!!!
it’s ‘different’ there? santa barbara has a lot going for it…there’s a beach there i think maybe? i think a soap opera fictionally takes place there? or maybe the wal mart greeters just make $20/hr
Look up the median income income for Santa Barbara. You will discover that it’s not enough to pay for a $600-700k mortgage.
Nope. Paychecks are significantly lower here than in LA for equivalent jobs.
Affordability (% of households with sufficient income to purchase median-priced house) is below 5%.
Fortunately, rents aren’t as excruciating as purchase prices; still hideously expensive.
It’s a beautiful place, but you take a huge cut in standard of living to be here.
That was the money quote that jumped out at me, too. On what planet is $600-700K workforce middle class housing. I thought I read it wrong or Ben added extra zeros.
Japan!
10 times income is pretty common here in Tokyo. Of course people in Tokyo are fairly stupid consumers. They think their getting a better deal by paying more for something.
My wife who is from Osaka thinks Tokyo people are just downright stupid over all. Most of the smart people in Tokyo are NOT FROM Tokyo.
People think Japan is so expensive, but the secret is that it’s actually more affordable than the Bay Area or other more expensive parts of the US if you live anywhere but Tokyo. Some nice places in Japan outside of that smoggy, crowded, so-called world city too.
And that comment says a hell of a lot about the bubble mentality: when high-flying builders display public anger when a phanton middle class can’t use liar loans to buy their insanely priced product.
Maybe he’s referring to the middle class of the uber-rich.
I’m sorry, but it never gets old for me…
“… they bought their tickets, they knew what they were getting into. I say, let ‘em crash.”
http://www.pacbiztimes.com/index.cfm?go2=articles/wk_042905a
$900-$1,000 per sq. ft. and they think those are condos for starting buyers and retirees?
Wow, you’re right they’re going down in flames.
This is not at all strange for Santa Barbara. Anything under $1M is considered “middle class.” Police, firefighters, teachers, etc. cannot afford to live in Santa Barbara unless they bought their houses many years ago, or have a rich spouse. Think Aspen on the beach.
“$6-$700,000 is middle class workforce?? Well I would say is really is different there… As in completely detached from reality. Wow!”
The message I got from the Santa Barbara article is a new one on me. Evidently there are now condos available in SB for under $500K. I looked on MLS. There ARE some tiny ones. There are also quite a few in the $500-$550K range that actually have enough space for me. Why am I fooling around with Morro Bay if I can actually live in Santa Barbara? When the rest of my world asks me how I managed to afford to live in SB, I’ll say I got rich on the housing bubble bust. Presumably if I wait another 6 months, I can get a decent condo in SB for under $500K. Omigod, Santa Barbara, who woulda thunk.
“It is the city’s loss, he added, because for the past couple of years Blankenship Construction has been one of the few still creating condos in the $600,000-$700,000 range — middle-class workforce housing, just like the city said it needs.”
This guy is a terrible businessman. He should sell them to the government; the $600,000-$700,000 range is ideal for Section-8 housing.
Mumbo Jumbo
“The difficulty and expense of getting ‘jumbo’ mortgages - those over $417,000 is clearly reflected in the sales results, which show 1,610 jumbo mortgage purchases in December, down 65.7 percent from December 2006.”
“Mumbo Jumbo is a noun and is the name of a grotesque idol said to have been worshipped by some tribes. In its figurative sense, Mumbo Jumbo is an object of senseless veneration or a meaningless ritual.”
http://en.wikipedia.org/wiki/Mumbo_Jumbo_(phrase)
And this from Dictionary.reference.com:
“mum·bo jum·bo…noun, plural mum·bo jum·bos.
“1. meaningless incantation or ritual.
“2. senseless or pretentious language, usually designed to obscure an issue, confuse a listener, or the like.
“3. an object of superstitious awe or reverence.
“4. (initial capital letters) the guardian of western Sudan villages symbolized by a masked man who combats evil and punishes women for breaches of tribal laws.”
The traditional definition is magical gibberish.
Go to this article and trash it.
http://digg.com/business_finance/South_Bay_apartment_rents_soar
I know rents are up in San Jose, but we can’t let them get away with reporting asking rents as “rents”. The only number that means anything is actual paying rents.
Rents do seem to be edging up a bit but as you point out that’s “asking” not paid rent. It also doesn’t reflect any specail deals like a couple months free rent which appears to be still going on in some places though not as prevelant as during the downturn after the dotcom bomb. My rent has not gone up since I moved to Sunnyvale 3 years ago. We’ll see what happens in June when the lease comes up for re-new? If a recession is on the horizon you can throw out any further rent increases around here it seems.
I’m starting to see some “price reduced” signs on the craigslist rental section.
This does not surprise me. Rents are going to soar and this is going to close a decent portion of the gap between renting and buying. But prices will continue to fall as well. Nobody wanted to hear this when I posted it, but rents are going to soar.
Not here they’re not. I’ve got 3 high-rise (40-50 floors) rental towers under construction within 3 blocks of me. One of them will opening in time for the summer renting window. Last year, a 35 floor rental tower opened up about 3 blocks away. I’ve been in my building since it opened about 3 years ago, and for the very first time, they have signs out in the street advertising rentals. 3 years old and they are remodeling units when people move out (and they are…). I’ve got granite counter tops (seriously, what is the big deal with these things?) full-size washer and dryer in the apartment, free internet and satellite TV, fitness center and rooftop deck. Yet that isn’t enough to compete. Hardwood floors are being installed, the appliances are being ripped out for stainless steel, the washer and dryers are being replaced with the fancy set that includes a front-loading washer.
Why I extended my lease again last year, they raised the prices quite a bit (I think it was around 6%). I didn’t like it, but I would have done the same thing. The building was at 98% occupancy. It’s now down to about 85%. Think they can raise the rents again? Yeah right. The just-finished condo building two blocks away has a bunch of f’d flippers offering 2BRs for $1800 - 2000 a month. I’m fully expecting to get a bigger apartment for less money come July.
I live in Downtown San Jose and my rent has barely edged up this year. There are a ton of empty units in rental buildings and condos that people are renting out to try to avoid selling “in this market”.
There is a 70 or so unit brand new condo building downtown that decided to rent instead of sell and are asking absurd rents. They have only found 4 suckers in about 3-4 months.
joe momma, explain why rents are going to soar. If housing has been basically overbuilt, must rents not fall?
Rents don’t soar during a recession, since they would quickly exceed renters’ ability to pay them.
Exactly. Rents are declining nationally. IIRC, cnn’s Money had an article on it a week or two ago.
During a recession, J6P runs home to live with mom and dad further increasing the oversupply of housing.
I think its funny Joe Mamma’s comment come right after Big V noted rents are being reduced.
Got popcorn?
Neil
Correction: It was on Yahoo Finance that rents are going down:
http://finance.yahoo.com/real-estate/article/104224/Home-Sellers-Pain-Is-Renters-Gain;_ylt=AqOQEavTL5ECUzmWE9nzwJW7YWsA
Got popcorn?
Neil
Neil called it again. Housing Vacancy Elasticity. Think about your own personal situation. How many vacant bedrooms in your neighborhood. Not just vacant houses (those count too), but vacant bedrooms.
Rents have softened for houses in Sacramento by 5-10% in that last 12 months. Apartments have held steady, since so many FB’s are giving up houses. Once those houses make it through Countrywide’s foreclosure process and come out the other side they will be purchased by investors for 60% of the 2005 sale price and the investor can comfortably undercut more FB’s trying to rent their stuck flipper units. Wash, rinse, repeat.
I don’t understand the logic that rents are going to soar. It baffles me. We have an over-supply of homes. Yes, foreclosures are making many owners into renters forcing rental supply to constrict. This is a temporary anomaly. The total amount of homes doesn’t just go off the market as a foreclosure and stay that way forever.
In addition, there are a number of macro-economic factors which effect rents. Recessions and out-migration from expensive areas counter-balance tight supply quite nicely.
It is getting ridiculous around here. Houses in my East Bay hood are just sitting there. One house has been for sale since May. I’ve watched the sign slowly lean over until it is now resting against the iron fence out front. Several have price reduced signs. One has been foreclosed upon.
This is all in an area deemed safe and highly desirable to families…
The crash is here with gusto!
Not just yet. Existing homeowners that are well above water need to take to the idea of trading down. Once that trend hits the front page of your local paper, the panic/capitulation phase will not be far behind.
Hi Jestson Boy:
Are you the one who had almost given up on the crash about 6 months ago? I’m glad to see you hung in there.
Admittedly yes. I’ve since found my fears to be unfounded. I figured that eventually the insanity would come back and bite those who bought into the RE machine in the rear.
My only concern now is that it appears to be coming back far worse than I ever imagined, taking the entire economy with it. I’m saving as much as possible as we speak. I’m fairly confident that lenders will require sizable down payments and near-perfect credit… both of which I now have. So if all goes well, I expect to be buying something in 2-3 years, or whenever I start seeing fundamentals being met. Realistically, I expect CA to still have some silliness even after the fall. But at least it will be somewhat affordable if you make decent wages.
What economy?
Wages have been flat for 7 years.
What is Silicon Valley producing?
mebo? facebook? digg?
The FIRE economy everybody knows!
All we’re doing is lurching from bubble to bubble. The gig is up.
“DataQuick said the December median was $587,500 last month, down 4.9 percent from $618,000 in December last year. It was an 11.7 percent drop from the peak median of $665,000 reached in July. For resale houses, the median dropped in every county except Santa Clara.”
How will they spin this? One the one hand, they need to keep touting the holding-up median in Santa Clara, but on the other hand, they have to start trashing the median as a valid statistic because of the rest of the county.
“The WaMu sales manager also demanded Wertz change her appraisal process to produce higher prices for the properties she was evaluating, according to Wertz’s lawyer Stephen Danz.”
Mortgage fraud at it’s best. I am confident that this unidentified sales manager will be looking at serious prison time when the civil tort is completed.
i am confident otherwise. this happened across the country, in every lending office. there is no room in the prisons for all of em.
IDEA:
let’s get all the $250 or $600 or whatever we’re (all of us on the bubble blogs) given by uncle bernanke, and put them together to build a white collar prison full of mortgage fraudsters and realtors. bernanke or greenspan will get the rooms with no windows though
How about full page ads by us blogheads showing all the lies and disputing all the “we couldn’t have known” or quotes over the years from Yun, his predecessor and perhaps the lovely Leslies Appleface.
I will contribute.
Me, too.
Are you on food stamps or unemployed? That seems to be where they want to target the money. Time to buy stock in Mad Dog 20/20, Thunderbird, Colt 40, etc.
Ankle bracelets. They stay out of prison. We don’t have to pay for their living costs and they have to find some way to pay for their holding cell. And we use up some of that vacant housing stock.
First in, first win. I haven’t read of another such suit, though there are likely others. Ah, the revenge of this honest appraiser will be both sweet and rewarding.
I have seen very few prosecutions of persons in the real estate fraud business prosecuted to date. Most involve multi-million dollar rip-offs. This case is ’small change’. I doubt he we be seeing any prison time. In fact, aside from the suit against WAMU, he probably won’t see anything other than a change in employers.
im in the business. these are the people who got promoted…decapitation must come down from the top first.
How do we contact Paladin? Sounds like this would be of interest.
“Linneman said growth will catch up to the glut by year’s end. ‘It won’t necessarily return to crazy,’ Linneman said, referring to the double-digit annual growth in home values that took place earlier this decade. ‘This area came to believe that you couldn’t lose money in housing.’”
Call me crazy, but this guy is still on the juice. Growth will catch up in housing. Yeah, maybe, a big maybe, in the rental dept., def. not SFH. First, living there is like living on Mars. Second, no real industry to support high priced housing. Third, commute to places where high income is available is just too far. Fourth, people are already leaving jingle mail (I don’t see them coming back anytime soon). Fifth, this country is in a recession, which is only going to get worse, so who and how are they going to buy when no one is lending?
I realize this guy might be trying to hedge, but let’s be honest, this economy is bust. I know it is a small indicator, but look at the Dow today. SInce it reached that high of more than 14.1K, it has lost 14%. Ouch! Just imagine an odd 7-pice pizza and someone just took a slice and tossed it out the window. On top of that how much has been written off, 150billion since we started? How many lenders gone? More than 200? Job losses? Countless. How about the drop in private RE, 10% of 10trillion? What’s that, 1trillion. This is a giganticnormous mess that has to be worked out, EVEN IF IT MEANS, YES, SOUPLINES!
All I can say is I went home at lunch and caught the last 10 mins. of MSNBC and with all due respect, those people were talking like it was a funeral. One guy was soft-voiced and monotone. Sounded almost like a robot until I realized he probably has never even heard of a recession, let alone a market, like this one. Was just something you read about in countries like Zimbabwe.
And to think, we are MAYBE, in the bottom of the second inning.
Lord help us all.
I turned on the TV to see Bernake this morning and I swear I heard his voice wavering… like he was gonna just break down or something… Big things are happening…
I know, I heard him too. I think he always sounds like that, though. Must have gotten beaten up a lot as a kid.
He never sounds good. Says “uh” a lot. Not a good public speaker, and I think he now knows he gets left holding the bag. I doubt he lasts very long.
during “we are not yet in a recession” line, Ben clearly looked down at this desk. That was scarey to see - somebody pushed him out there and said “positive Spin, no matter what”
Someone in the audience must have held up a photo of a Joshua Tree for him to see.
The market is only down to where it was, what, a year ago?
There’s a glut of housing in all of the surrounding *desirable* counties that won’t be worked through in 2008. If anything, the glut in the IE will grow in ‘08, not decline much less be absorbed by phantom growth.
I guess only in California do they describe 600-700K condos as “middle class workforce housing”. I also liked the way that they were all being purchased by subprime borrowers!! I guess we’re all sub prime now. WTF
I remember reading something a few weeks back about how people in the bay area/San Jose making under $80-100K a year were now considered “Low Income” . Needless to say I got a sinking feeling in my gut from that.
That is true. To qualify for low income housing in the San Jose area, your family income must be less than $100K. Almost everyone in the area are electronic or software engineers.
I believe that San Jose will enter the recession like everyone else, only later. The high paying technical jobs are moving to China, and India. The only think holding San Jose up is the Stanford research. (Someone in Stanford just found a way to make batteries last 10X longer, this and other technology coming out of Stanford keeps San Jose rich.
Give me a break. That’s like saying almost everyone in L.A. works in the movie biz. So that guy working at Denny’s on Hillsdale is actually an engineer? Wow. Who knew?
Stanford? Puh-lease. There are some great things about that school, but it hardly supports the Bay Area tech economy. Oh wait, the Google guys are from Stanford. Never mind you’re right, Google will save us all…….
I see flames. Large red flames licking at the eaves of beige stucco boxes.
$600-700K in bubble prices represent 1200 square foot condos in Santa Barbara. They will be $375K in 2009 but still about the cheapest in SB. They are the low end and thus, “middle class.”
Thanks ABR, this is pretty consistent with my reaction above (that the 1200 sf’s are now $550, will be under $5 in 6 mos, so yes, I can believe $375 2009…WOW, I never thought I would be able to live in SB, but I see it coming …)
The South Bay saw a 45 percent drop in sales compared with a year ago, according to CAR. Besides cities like Torrance, Hermosa Beach and Manhattan Beach, CAR’s South Bay figures include Long Beach, San Pedro and Wilmington.”
- I drove to 2 job sites this mid morining in Palos Verdes and Rolling Hills and the traffic is absolutely dead. Usually there is some construction traffic like landscapers, painters, framers etc. It is pretty dead on the hill and the So Bay as far as new construction. We are holding strong with a lot of retail remodels.
45% drop over a year? This means we should start seeing double digit percentage drops in prices of houses sold this year there in the South bay. Finally! It’s been overpriced since the Fall of 2003. I lived there from spring 2003 to spring of 2006.
The 45% drop in sales was heartening to see! I think this is the first time I’ve seen San Pedro mentioned (other than the comments) on this blog, so it was doubly sweet. I looked in one of those glossy real estate magazines today and NOTHING that I would live in (I want a 3/2 with a big yard) could be seen for under half a mil.
“Leslie Appleton-Young, chief economist of the California Association of Realtors, blamed the credit crunch and buyer reluctance for a negative housing outlook for 2008.”
Yeah, that’s right. This is all the fault of the buyers. How about the greedy sellers that won’t capitulate from 2005 pricing? Or sellers’ lying on their loan docs to get into a house they couldn’t really afford? Or Realtors with their quotes of “buy now or be priced out forever!”
Realtors, flippers, and the irresponsible are the causes of the current meltdown. Buyers who are smart are just standing back, watching the train wreck from afar. Don’t ask me to commit financial suicide for the sake of artificially propping up the California housing market.
The North County Times. “California’s economy will continue to slow, but maybe it won’t, or maybe it could tip into recession, a federal economist said Wednesday in a speech thick with caveats.”
That’s cool because, I mean, like, numbers can get hard and sometimes bum people out and what we need to be doing is getting out our maps because some people just don’t know where the really good surf spots are and there’s a lot of information out there, but I’ve been talking to people on the street. That’s where I’m at.
sounds like something a beauty pageant might say.
also, there is good surfing in the iraq and parts of south africa and such as.
Knarly dude
Maine home prices defy national slump http://pressherald.mainetoday.com/story.php?id=163046&ac=PHnws
I am extremely suspicious of this article, which bases its conclusions on median prices. Y’all know I spend about half the year in Maine. I have seen the slow market, I have seen a “spec” house go for 30% off, even on the shore. I am not surprised to learn that median prices are rising — $188K is not very much by the standards of the NYC people who are retiring to Maine. Wonder if Case-Shiller covers any Maine area. I would bet it would show a decline.
“The family hopes to sell so they can purchase or build a home on country property, Rowlands said. ‘So they’re willing to take a loss, but they’re going to buy something a lot cheaper than two years ago, if they can make it happen,’ he said.”
49′ers: (er, the other States)
This is the reason your local real estate markets are in such dire straits…
If you can’t sell your White Elephant in California, you can’t buy a cheaper White Elephant elsewhere.
Got Peanuts?
Condos in the country for everyone!
The story about the assessor made me kind of upset. Here was a woman just doing her job and she gets blacklisted by WaMu, and now it’s clear she was totally right.
I wonder how this kind of abuse can be avoided. Maybe the city should be doing the assessments, since they use it to calculate the mill rates. Maybe there should be a process where blacklisting can only occur when there are multiple complaints against a particular assessor.
The system needs reform.
“Maybe the city should be doing the assessments..”
HAW! You think public employees can’t be “persuaded” to “adjust” their numbers?
“HAW! You think public employees can’t be “persuaded” to “adjust” their numbers? ”
Actually, my experience with municipal employees and government employees generally (and I used to be one) is that everyone goes by the book–even when it doesn’t make sense. Everyone covers their behind and makes sure not to go out on a limb.
Having government employees make assessments would be a very good way to control fraud. Think building inspectors. Yes, there are some crooked ones, BI’s that take bribes, etc… But most of them are sticklers for detail and a real pain in the behind.
However, having government employees do assessments would certainly cost more than the current system.
having government employees do assessments would certainly cost more than the current system
Bill it to the used-house sellers.
I’ve done volunteer work with a building inspector. “Sticker for detail” describes her to a tee.
Master-Of-The-Obvious (M-O-T-O)
“Leslie Appleton-Young, chief economist of the California Association of Realtors, blamed the credit crunch and buyer reluctance for a negative housing outlook for 2008.”
“‘I’m pretty sure we’ll be seeing a decline in the median in 2008,’ she said.”
ALERT - CNBC…
Commercial Mortgage Market and RE market is cracking. Starting to have massive defaults.
Link?
Like no one on this board saw that coming, either.
Shocked, I tell. SImply shocked!
Here’s one major tell…In Manhattan, Macklowe purchased at the top of the market some buildings from Equity Office Prop. for 7+ billion, using the GM building for collateral, as well as a 1.2 billion bridge loan from Fortress. The bridge loan is due in Feb., and now Macklowe has to sell the GM building pay up. The WSJ says that prices for commercial buildings are falling, and Macklowe may not get the price he needs.
http://online.wsj.com/article/SB120043318837492301.html?mod=googlenews_wsj
I think the buyers are sitting on the fence,’ said Scott Rowlands, the agent…
I think more and more are on the “it’s incredibly stupid to take out a massive loan on an overpriced home that will continue to go down in value for years and years, what were we thinking” side of the fence, not sitting on it.
I keep getting this image of these buyers looking like Wilson peeking over fence on ‘Home Improvement’ - except his eyes are wide with fear and loathing.
Actually, I’m sitting at home with a sack of popcorn, wathching the housing meltdown.
I’m not even going near the fence until I see some serious desperation and panic in the housing markets.
Then, the time is near and I may get off the sofa and start moving out to look over the fence.
Until then, I’m not even close to the fence…..
I can’t even see the fence from here!!!
Me, I am leaning over the fence, watching realtors shrivel up and starve. Occasionally flinging some poop at them when they get within range, but that is just for the entertainment, nothing personal.
“The family hopes to sell so they can purchase or build a home on country property, Rowlands said. ‘So they’re willing to take a loss, but they’re going to buy something a lot cheaper than two years ago, if they can make it happen,’ he said.”
do these people not realize that everyone has the same idea as they do? how do they expect to unload an overpriced house? the game is over! no one will switch places with them!
Exactly. The one thing I’ve noticed in CA is that even though people seem to go ape over buying homes here, most of them are just as giddy over selling it, and usually within a short time so they can move to Oregon, Washington, or “to the country” like these folks are trying to do.
Sort of makes you wonder if any of these people have any real attachment to the homes they slave over.
The time to have contemplated moving has passed many by, in Procrastination Nation…
Also they managed to drop the price a massive 5% in 6 months….
The should be dropping it 5% below the most recent comps, and continue to do so until it sells.
“It is the city’s loss, he added, because for the past couple of years Blankenship Construction has been one of the few still creating condos in the $600,000-$700,000 range — middle-class workforce housing, just like the city said it needs.”
$700K middle class workforce housing? LOL!!!!
See my comment further down this thread (it should materialize there soon) about Blankenship’s swan song.
Saint Barbara
“The ability to negotiate now is probably as good as I’ve ever seen it. You’re not competing with everybody. You’re not competing with a lot of investors, though I expect them to start coming back,” he said. “But it’s also possible that we may have another year of grinding through it and the market doesn’t level out until 2009.”
what is the probability of investors returning to the scene of the crime? will the banks extend credit to them for multiple houses in the future? i sure hope i never see that happen!
The next wave of investors is the hard money, 42 cents on the dollar crowd. End user buyers will be competing with these investors, who will be relatively easy to beat by being willing to pay 44 or 45 cents on the dollar. The investor will just unemotionally move on to the next property. There will be no bidding wars this time.
The falling home prices hit home with me when I looked up my cousin’s house on on Zillow. Clovis CA- bought for $379k in 2005 and estimated value is now 312k. Ouch!
Central Cali is going to be a very ugly bloodbath.
Zillow is being overly optimistic (how surprising?) about the value of Clovis houses, as every homebuilder is now offering in-ground pools, or whatever it takes, to move new inventory…
Reality is probably closer to $200k, as if anybody cares.
I just wish some of that would hit the Bay Area. 200k for homes in Cali? Hell- I’d buy something in the Bay Area for that. As it stands now, 550-600k is the norm here, even though that seems to be changing quickly.
I did see a 1200 square feet shack for $380k with no buyers. She paid $250k for it back in 2004 if I remember. So yes $200k homes should be a reality and it should get you something nicer than a shack too
“we dont want to give people enough rope to hang themselves”
now he tells me…theyre already swinging from the gallows pole all over the place
“‘…I think the buyers are sitting on the fence,’ said Scott Rowlands”
Okay, this is getting old and is fairly in accurate. I’m not sitting on the fence. I can’t climb the mountain of debt the fence is sitting on top of.
No one on this blog is sitting on any fences…we are lounging around comfortably, commenting on the disaster, while enjoying hot buttered popcorn.
Exactly, spike!
WAMU lose $2B in home loans. Damn. Karma.
http://seattletimes.nwsource.com/html/businesstechnology/2004130918_webwamu17.html
In the great Mogambo tradition, this will be the new mantra:
200 THOUSAND DOLLARS IS A LOT OF FREAKIN’ MONEY FOR A HOUSE.
whew!
——————–
The continuing decline in home values prompted Sacramento-based researcher TrendGraphix to declare December the ‘resurrection of the $200,000 house.’
“Appleton-Young added some cautious encouragement for buyers: ‘No one rings a bell at the bottom of the market.’”
Thats weak. This bottom will linger for years, we have a Recession now the very thing the fence sitting economists said would alter there cautious outlook. I got your bell.
We rang lots of bells on this blog at the market top, and I imagine we will do our best to call the bottom if Ben is still posting by 2012 and later.
No one will ring a bell at the bottom of this market because no one wants to listen to a bell for years.
Yup, was just thinking of the roommate whose alarm was set for 2 a.m. It went on and on and on and on until, having determined that the roommate was not there, I pulled the plug out of the wall.
Baby boom and bust
Jan 17th 2008 | ANN ARBOR, MICHIGAN
“…For three decades baby-boomers have helped push prices up: they settled down, then bought bigger houses and second homes. But as the first of them celebrate their 65th birthdays in 2011, this may change. The old sell more homes than they buy, according to data covering 1995-2000 (see chart). The ratio of old to working-age people is expected to grow by 67% over the next two decades. Will the younger generation be able to buy all the homes on the market?…”
Economist
http://tinyurl.com/25267t
A reason the collapse may take more than a few more years. Nice study out of California.
I’d say we’re in confirmed bear mode now, wouldn’t you?
Why did the chicken cross the road?
Albert Einstein: ” Did the chicken really cross the road, or did the road move beneath the chicken .”
The technical damage is unreal. I just don’t see how it gets back to bull mode before we go much much lower. Rallies, yes, but seems as if we’ve seen the top for quite awhile.
Ah Young lass, the damage is just starting.
This is happening as the result of a 10% drop in house prices. As the commercial market implodes and housing continues to drop, the CLO market collapses and corporate BK rears its ugly head, there is nothing the government, the unelected officials at the Federal Reserve or the private sector can do to prevent disorder.
Remember rule #1
“The market will do, what it can do to cause the greatest amount of pain to the most amount of people.”
And Rule #2
“Bear market rallies occur and are vicious.”
The fundamental values are unreal. The highest P/E ratio since Nov 1999 and earnings (if there are any ) going south. Can equity prices stay up this high?
I suppose this is a great time to place one’s faith in the random walk theory of stock prices. (Loosely speaking, whatever happened today will have no bearing whatever on what happens tomorrow, or next Monday, Tuesday, etc.)
“This is happening as the result of a 10% drop in house prices.”
10% is a historical fact - what’s happened in the last 3 weeks is (finally!) the growing realization that many house prices are 100% overvalued and will drop 50%, not 10%.
Take a reasonably nice condo not too far from the beach in Ponte Vedra Beach, Fla. as an example:
Spring 2007: Well, 250/sq. ft. was kind of silly, 200-220 looks like fair market value.
Fall 2007: 180/sq. ft. is a bit of a sacrifice, but that looks like where the market is going.
early Jan, 2008: Oh, s$it, I don’t think you can sell anything for $180, maybe not even $160.
week 3, 2008: Oh, my god, Paul in Jax is right, this stuff could go to $100/sq. ft.
late 2008: man, I’d just be happy if we could sell for 100 X rent - ($80-90/sq. ft.)
The market is due for a rally on good news, but that’s been the case for 5 weeks. I think the market now has a two-quarter recession and no growth for 2008 very well priced in, but not a huge recession. Only now is the market downturn becoming lead-off headline news, so a good rally is near. But the bet now is generic recession (bullish) vs. bad recession (still bearish).
Right. I want to play that rally. It could be vicious. The rubber band has been pulled back awfully far.
Apologize for not keeping this in bits, but: Been on the road trying to make real money rather than “fast” but got back in time to see the (taped) Fast Money comments about VIX. Went from 25 to 28 but 30-32 probably needed for a firm bottom. Market likely to rally into Monday but once Jan put protection off the market is set up for another good blowout on the downside around next Tuesday. But anything that has been taken out and shot this week is probably a buy - something like a Freeport-McMoran which is down 25% vs. 5% for copper and should report nice earnings. But the retailers still look vulnerable to me.
Just to bring it back to housing: I’m more convinced than ever that the decent 100K Florida house (”Palmetto’s house”) within five blocks of the beach in a decent neighborhood will be back soon, maybe this year.
market’s closed on Monday
I had been talking about this until I was blue in the face from ‘03 to early last year. I’m glad to see it in print.
I wish I had paid attn to this earlier. A new set of numbers to crunch over the weekend. I remember folks (you?) posting about this event but I treated it as white noise.
Yep us pesky social scientists. We often get tuned out as white noise so we’re used to it >; )
I live in a univ town in northern CA that is made up of students (very young) or silent generation and boomers (all cohorts) so I saw it because it really is in your face here. Davis really a nice little microcosm of what ails us.
At one point I was counting off the death-related vacancies in town as a fraction of rental and resale housing stock. It was incidential data at best since I just counted people I personally came into contact with. It was fun in a rather grim Goreyesque fashion.
Glad to see you have awareness of the boomers downsizing in the future. I read this in Harry Dent’s books in the late 1990s and that kept me extremely skeptical of the real estate prices the last few years. In a few years you will also have the realization that oil is finite and the $2,500 cars in India are going to be sold in the millions, meaning more competition for fewer fossil fuel resources.
I don’t think I’ve ever been called white noise before.
Exactly.
When everyone was talking about Baby Boomers causing housing prices to rise *in the future* I couldn’t believe my ears & eyes.
In every single case I know, the Baby Boomers will be net **sellers** of everything — housing, stocks, antiques, toys, etc.
IMHO, it was the Baby Boomers that caused much of the inflation in prices over the past few decades and think deflation will be the prevailing trend going forward. Add globalization to this, and we’re in for a nasty deflationary depression in this country, IMHO.
A coworker of mine said the same thing about the stock market. Seems that saving is the best thing to do at this point. Prolly a good idea to buy a house with as much cash as possible at the bottom of the bubble, but refrain from purchasing investment properties. Saving for retirement will be difficult without stock returns or rental income, so we should brace ourselves for it now. Inflation is the word today, but the boomers won’t let that happen too long because they know it will kill them in the end.
How many times have I made this argument here? Duh!
The demographics are all against the bubbleistas. Baby boomers begin retiring this year. Millions downsizing right when the option Arms peak. This is getting better than reality TV.
The other fly in the ointment:
Pensions and Social Security insolvency.
Baby Boomers will NOT be buying all manner of assets when they can hardly afford to put food on their tables (they won’t be able to afford healthcare).
Not good.
“The difficulty and expense of getting ‘jumbo’ mortgages - those over $417,000 is clearly reflected in the sales results, which show 1,610 jumbo mortgage purchases in December, down 65.7 percent from December 2006.”
This is amazing! It’s actually very easy to get a Jumbo mortgage. Just put 20% down, and don’t finance more than 3.5x your income.
That was the criteria I had to meet when I bought my house in Sunnyvale, CA in 1989!
It’s not about mortgages, of course, it’s the fact that HOUSE PRICES ARE TOO HIGH!
It’s also funny that they talk about the “expense” of these mortgages. Sure, the initial “HOWMUCHAMOMTH” may be more $$$, but a traditional 20% down fixed mortgage is the cheapest way to buy a house. It always was, and always will be, short of an outright cash purchase.
If they’re going to write checks to everyone to stimulate the economy, can they at least do it for people who had nothing to do with the “mortgage crisis?” Perhaps limit it to people with savings accounts, or who don’t have adjustable mortgages.
I want an extra check for being responsible.
Greedy SOB!
Just kiddin’!
Obviously, this will never happen. But you have to put the blame on the economy on our citizenry who simply spend money that doesn’t really exist on imported crap!
I’m against these $800 “rebate checks”. If they want to lower my taxes $800, simply put a line on next year’s tax form that says “-800″ before “total tax due.” That’ll be a lot cheaper than mailing and processing all those checks.
Regarding the subject of the Santa Barbara Independent article, I witnessed local developer John Blankenship’s swan song before the city planning comission a few weeks ago. The purpose of his appearance was to gain final approval to build four “Mexican Colonial” style condos, which would replace an old California bungalow (constructed of 5,000-year-old redwood) , at 1236 San Andres Street (just west of downtown, on the “wrong” side of the freeway). Neighbors were present at the meeting to decry, among other things, the demolition of the well-constructed old home. The commision unamimously issued its final approved for the condo project — after which Blankenship neverthess approached those neighbors and told them, “Don’t worry; I’m not going to build it.”
A few days later, I drove over to 1236 San Andres to snap some pictures of the old tear-down for my blog. It was a Saturday (January 5th) at 3 p.m., and the property is adjacent to a small city park. A gang of about 6 Latino “gentlemen” stood guard at the narrow park-entrance stairs, defying me to even come near. I took a few photos of the house and high-tailed it out of there.
Blankenship was the only local developer left in Santa Barbara who was still building for Santa Barbara’s “middle class” — whom he now finally understands no longer exist, at least for his purposes.
Saint Barbara
Santa Barbara Housing Bubble Blog
A gang of about 6 Latino “gentlemen” stood guard at the narrow park-entrance stairs, defying me to even come near.
Thats the Santa Barbara I Remember. Someday all of S. Cali will be like Santa Barbara either very rich or pissed off poor, just like Mexico. Any middle class will be civil servants with subsudized housing. Kind of a buffer.
Correction: The events described above occurred last week — not a few weeks ago. Also:
commision = commission
Santa Barbara = toast
‘So they’re willing to take a loss, but they’re going to buy something a lot cheaper than two years ago, if they can make it happen,’ he said.
You just can’t make this stuff up!
builders have erected 30,000 to 40,000 more homes than they should have.”
“Linneman said growth will catch up to the glut by year’s end.
Are there really enough people in that area to fill all those houses? I mean, if “all housing is local”, then isn’t it possible that in the IE, there just aren’t any locals for the houses that were built? Ever? And what does that do for the area as a whole, long term? Eventual suburban ghetto?
“It is the city’s loss, he added, because for the past couple of years Blankenship Construction has been one of the few still creating condos in the $600,000-$700,000 range — middle-class workforce housing, just like the city said it needs.”
This is middle class????????????????? $600-700K? About $4-4.5K a month for mortgage payments with $60K-70K down? That’s MIDDLE CLASS??
Santa Barbara can go *^^*^*^ itself.
Sorry to repeat this from the WS thread, but…..
Subprime is Contained!
Now everybody on this blog get back to work. hehehe
I meant to say……
Now go get your shinebox! hehehe
“Zimmerman said rising interest rates could bode ill for construction and other industries that depend heavily on credit. Bank of Escondido Chief Credit Officer Mike Churchwell said the bank no longer loans to companies that depend on a booming economy to help them cover their debt, he said.”
“‘We don’t want to give people the rope to hang themselves with,’ Churchwell said. ‘We want to help clients make good decisions.’”
The Rope Bubble of 2002-2006
Holy crap, someone is building a new subdivision in WATTS with prices STARTING in the mid $400’s?? From the LAT today…
http://www.latimes.com/news/local/la-me-watts17jan17,1,6319035.story?ctrack=1&cset=true
Unbelievable. I’m just speechless…
And I especially LOVE the caveat…”annual median household incomes in the community ranged from $12,000 to $25,000 as of the 2000 census”.
Oh yeah, home prices of 37 to 18 times medianl income. Should be a big hit…
Especially after the taggers add their “artwork” to the “for sale” signs. That’s already happening here in Tucson.
During the recession, the marginal areas will be ground zero. I hope each home comes with bars, bullet proof glass and an automatic gun as free upgrades. They will need them.
“Home builders in the Inland region outdid themselves when times were good, and have built tens of thousands of homes too many during the last few years, a Philadelphia economist says.”
“In Riverside and San Bernardino counties, said Peter Linneman, principal of Linneman Associates, builders have erected 30,000 to 40,000 more homes than they should have.”
Any good reason why they couldn’t find an economissed a little closer, to be the bearer of bad news?
Linneman was in Ontario (CA) Tuesday to give a presentation at an event hosted by NAI Capital. And, if you look at the full post, you’ll see the headline is “no recession” — the main point of Linneman’s presentation was to tell them that the bad news was temporary. The only locals who might tell them that would be REIC shills pure and simple.
Hoz, if you are still there…………
I’m coming to the conclusion that the world is headed for a severe deflationary period ala Japan. The more I read on what to expect in the future the more convinced I become.
Do you have any comments on this?
In 19 recessions in the 20th century only twice has there been deflation, the 1930s and Japan in the 1990s. Japan raised interest rates, the Federal Reserve will not raise interest rates. The other 17 cases ranged from high inflation to hyper inflation. The odds favor inflation.
For a recent study of deflation - recession
Federal Reserve Bank of Minneapolis
Research Department Staff Report 331
January 2004
Deflation and Depression:
Is There an Empirical Link?
http://tinyurl.com/2l7nwu
thank you
That was interesting. However, it is not necessary to establish a strong correlation between deflation and depression for us to predict our near future based on today’s information.
Bernanke has already established himself as a theoretical and practical inflationist. I don’t know the rules for how Federal Reserve chairmen are unseated, but if the boomers can’t get him out (because he’s eroding whatever savings they may have), then we will have inflation for a while. We are certainly getting it for the near future.
I just want to point out here that I’m beginning to think all this inflation is really intended to stick it to China. I’m pursuing this line of thinking because it doesn’t make sense for the guy to say that he’s not predicting a recession, but still needs to stimulate the economy.
I took a look at the data. Thanks for that post. Probably the two most relevant episodes to today ARE the two deflationary episodes in Japan and the U.S. But, probably the most important variable in 2008 is how big a global recession is brought on the by the nascient but almost certain U.S. recession. The more this is the case, the more likely deflation. The less U.S. recessionary contagion to ROW (rest of world), the more the threat of inflation here.
I think the more important countries are Argentina and Bolivia. The current account deficits and fiscal irresponsibility strike me as more relevant.
I still have an open mind, but my investment bias is to inflation.
I’m a stagflationist, with the current emphasis on stag. Note that Argentina are much less relevant to the global economy than U.S., therefore unable to induce recessionary/deflationary pressures abroad.
Interesting aside: during the year of Bolivia’s most extreme hyperinflation, which I believe was in the early 1980s, its second biggest import was banknotes. Yes, the physical banknotes, imported from W. Germany.
Not Hoz but I have a comment.
Depends on the age of the population of the country. Japan is old they get Deflation, America and Europe getting older but with immigrants so kind of like Japan. The Middle East and Africa with its fast growing population will get inflation.
my 2cents. would like to hear what Hoz has to say or any other bloggers.
my 2 pennies… there is this little wrinkle happening right now called “technological progress”
I don’t know how many people here ever played some of the old simulation games like civilisation, freeciv, simcity, etc. But if you did, and got to the advanced stage of the game, you usually ended up in this surreal over supply situation where there was just too much stuff being produced by all your factories, cities, etc. Much, much, too much stuff.
I think that’s kind of where we are now, especially when you’ve got these builders going around with nail guns doing what used to be a months work in an afternoon.
There are several different ways to get serious inflation in an economy, but having too much stuff absolutely isn’t one of them. So i’m voting deflation. With computer trinkets, stocks and houses leading the way.
Inflation is not naturally related to population growth, although GDP is. It’s crazy that GDP (and therefore recessions) is not adjusted per capita. From an investor’s standpoint, it makes sense to invest in countries with the highest population growth, especially urban growth. So, for example, Africa is better for investors than it is for the natives, because if you live there it’s only GDP per capita that matters.
Bad corroborating evidence: A colleague (not an economist) suggested something similar about a severe deflationary depression without prompting (well, I guess I did first show her some foreclosure graphs I made for San Diego county before she started talking about depression…).
–
“In Petaluma, Kevin and Rebecca Boesler have cut the price of their home 5 percent since listing it for sale in August. The 2,500-square-foot, four-bedroom house was originally placed on the market at $789,000. Hoping to attract a buyer, the Boeslers have reduced the price to $749,000.”
Nice try. Prices have fallen more like 5% since the listing, in all likelihood, so you will remain behind the curve. It is a common psychological problem in falling markets.
Jas
The Sonoma Assessor has their home assessed at… are you ready… $749,700!!! Gee, only different from their offering price by $700. It appears that Kevin’s father co-signed.
Zestimate on their home: $633,500.
You guys see this?
http://www.bloomberg.com/apps/news?pid=20601039&sid=aEXlKAu61sYU&
A lot of OUR Gold, formerly stored at Fort Knox, got “leased” out to the titans of industry, and a few months ago GS was telling everybody that Gold was going to go down, when all indicators were pointing upwards?
Now why would they go and say a thing like that, unless they had a vested interest in it going down?
Nudge Nudge, Wink Wink
hedging their bets I am suprised all the Banks didn’t do this? Maybe Goldman is not so smart but all the other banks are just very stupid?
All I know about Goldman Sachs is their mutual funds offered to a small company I worked for had very high >2% expense ratios. So I didn’t sign up until we changed to Fidelity.
Judging from the reckless behavior exhibited, it’s a possibility they didn’t hedge…
Wall Street has always poo pooed Gold.
Wouldn’t it be delicious irony, if it causes them to go under?
http://dallas.craigslist.org/fns/542457028.html
–
‘No one rings a bell at the bottom of the market.’
Why does the media keep on reporting these idiotic remarks? She certainly doesn’t have the best interests of her end customers — the buyers. Why shouldn’t the buyers wait out the decline, however long it lasts and rent in the meanwhile?
Jas
The buyers are not her customers. Members of the California Association of Realtwhores are her customers. Realtwhores work for the seller, because they are paid on commission. Somebody who makes more money the more I spend is not working for me. He who pays the piper calls the tune.
–Shannon
Transaction volume, too.
The longer we “fence-sitting buyers” stay out of the market, the less money the RE agents make.
They don’t care as much about price as they do about transaction volume.
DFW foreclosures up 31 percent due to lax lending standards. But I thought there was no bubble here and it was cheap!
http://www.dallasnews.com/sharedcontent/dws/classifieds/news/homecenter/realestate/stories/011808dnbusforeclosure.2fab4004.html
Jan. 17 (Bloomberg) — Small U.S. companies dropped, sending the Russell 2000 Index to its first bear market decline of 20 percent since 2002, after falling home construction and manufacturing reinforced expectations the economy will contract.
Raw-material producers and energy companies led the retreat after Federal Reserve Chairman Ben S. Bernanke’s acknowledgment that output is weakening added to concern that earnings growth will slow. CF Industries Holdings Inc., which makes fertilizer, plunged the most since November. Petrohawk Energy Corp., an oil and gas producer, retreated for a third straight day.
“In Riverside and San Bernardino counties, said Peter Linneman, principal of Linneman Associates, builders have erected 30,000 to 40,000 more homes than they should have.”
“Linneman said growth will catch up to the glut by year’s end.”
Is that stupid talk or what?
How can you fill 30,000 homes in a region in one year??!
If we assume 3 people per house, the region needs to have 90,000 people move in then.
I doubt if this has EVER happened.
“Only 188 homes sold in Sonoma County during December, about half the average for the month and the lowest since The Press Democrat began tracking the market 17 years ago.”
Let’s see now…
With over 2,000 REALTORS ™ in Sonoma County alone, and 188 sales in December, with two agents on each sale, that means that each agent has less than .20 transactions last month.
“The continuing decline in home values prompted Sacramento-based researcher TrendGraphix to declare December the ‘resurrection of the $200,000 house.’ The firm reported that 12 percent of the 13,994 homes now for sale in El Dorado, Placer, Sacramento and Yolo counties are priced below $200,000, with the majority being homes repossessed by banks.”
“A year ago just 2 percent of homes for sale in the region were priced below $200,000.”
And next year 33% will be under $200k. Those aren’t desirable parts of California with few local jobs unless you want to commute 2 hours each way. There was alot of speculators who thought those areas were “undervalued”
Any predictions how cheap per square foot those areas will be? I am saying $70/foot or the same price as south Florida. Could it be cheaper than south FL? Would people rather be in south FL or those parts of CA?
People would rather be South Florida because there’s no water in central CA.
We have this little chain of mountains about 400 miles long and 50 miles wide, and up to 14,495 feet tall, that gives us plenty of water here, in the Central Valley.
I’ve never spent any time @ altitude in the South Florida mountains, what’s it like?
Ironically, there isn’t enough water either in south Florida. Lake O is shrinking rapidly and some say it could dry up completely! Sure it rains during wet season but it can go a month without significent rain during dry season.
Better too wet than dry. Pennsylvania and the northwest coast gets plenty of rain. You need water to survive.
Just got back this eve from a trip to S. Fla. Just driving along the coast in Palm Beach or Martin Counties you’re reminded how much more of a problem there is with the natural vegetation than further north, up here in Florida-lite. The land is so fragile in deep south Florida because it is basically coral rock subsurface. (Back when the climate was REALLY warm 100,000 years ago - before our current baby-whiney global warming - all of south Florida was underwater because sea levels were 10′ higher). Everything, even orange groves and vegetable farms, require more fertilizer and cause more damage to the land than is the case further north. Once you get south of about Stuart, you’re in the Caribbean and you’re living on swamp and coral.
I think Lake Okeechobee will continue to shrink, no matter what the rainfall. One day soon it’ll have hatch marks across it on maps, the way the Caspian Sea does.
No that’s the Aral sea, because the rivers that feed it have been diverted by irrigation projects in Central Asia.
The Caspian is doing just fine, because it’s fed by the Volga (biggest river in European Russia) and other rivers in Russia, which is a pretty damp place.
Somebody please tell me this is a joke
http://biz.yahoo.com/pz/080115/134246.html
I actually like the idea.
“Some examples of unacceptable sectors are aerospace and defense, brewers, casinos and gaming, pharmaceuticals, tobacco.”
As reasonable as some nebulous S&P500 index. It is another option. The Dharma index. The we can have the Greg index.
This is a wonderful idea. They could also buy/rent a small chapel and each morning at 7am the faithful can gather to prey over their money for the coming day.
Maybe they could even hold some sort of service each weekend with membership drives to preach this new … ummm … faith to gain new converts.
All kinds of possibilities here.
“Some examples of unacceptable sectors are aerospace and defense, brewers, casinos and gaming, pharmaceuticals, tobacco.”
What if I belong to a clan of milataristic drunks?
Sounds like a scam to get mutual fund fees. If it sells, good for them.
Got popcorn?
Neil
Doesn’t look like a joke. A lot of stuff in India happens based on such hocus pocus (astrology, numerology, random brahmin’s advice).
Google Nitesh Gor - the head honcho of Dharma.
txchick,
You may like all things Indian but you clearly have no idea how retarded Indians can be over all things “religious”.
They make Kansas look sane (and just in case anybody gets all “post-modern” over me, I’m Indian and I grew up there!)
One of my parents was Indian. I know.
Christianity dominates other religions economically. Economies advance based on an acceptance of two principals inherent in the modern Christian religion: charity and forgiveness. These encourage the Western concepts of equality and risk-taking. The traditional Hindu religion is antithetical to economic advancement, as it casts a jaundiced eye on both of these ideas. Although China and India may not embrace Christianity, they and others are fonder of it than they let on because they realize the power of it economically. (Disclaimer: even though I am an unapologetic capitalist, I am personally quite fond of many aspects of the Hindu religion and don’t myself believe in “Christ.”)
What’s new here? Haven’t “ethical” mutual funds been around for a long time? As one of my investment gurus used to say, the “ethical” choice of investments didn’t prevent them from charging exorbitant, unethical management fees.
“Even a commodity as basic as water is an uncertain thing in Southern California. With a current drought in the Colorado River basin, the prospect of drier years ahead caused by global warming, squabbles over water contracts and a recent court ruling that threatens to cut supplies from the Sacramento-San Joaquin River Delta by up to 30%, these are times for serious concern about keeping the region’s needs quenched.”
“A forward-thinking water district in Riverside County is the first major agency to make that abstract concern concrete, by putting construction projects on hold because of tight water supplies. Its decision outlines clearly how dire the choices are, and how much more painful they will become, if land and water planners don’t work together on major conservation projects.”
http://www.latimes.com/news/opinion/editorials/la-ed-water17jan17,0,4614306.story?coll=la-news-comment-editorials
How can a place named Riverside be running out of water?
It was a typo when the place was registered. Should have been Riverslide.
440+ comments in the bits bucket - must be time to buy!
From Kudlow and Company this evening - Wayne Angel, ex-Fed Government (who another guest Arthur Laffer called a national treasure):
The Fed needs to cut interest rates 100 basis points so the T bill yields will come down to 1.5% and people will buy mortgage backed bonds rather than T-bills.
So the its better to get 10% return for a year or two and lose 80% of your principal (like E*Trade did) than get 1.5% but all of your principal back when you want it. That makes a lot of sense.
An ex-Fed governor is no smarter than Mozillo (of Countrywide) or Prince (of Citicorp). That makes me feel a lot better about our future.
Well, mortgage-backed bonds are hard to evaluate, but if money market rates go down to 1.5% or less, I would consider making some larger mortgage loans at “below-market” rates.
Nobody will buy MBS’s if the Fed rates go that low.
There will be a “dollar carry trade” instead.
Lord! How do these people get out of bed in the morning without understanding basic finance?
This is not at all strange for Santa Barbara. Anything under $1M is considered “middle class.” Police, firefighters, teachers, etc. cannot afford to live in Santa Barbara unless they bought their houses many years ago, or have a rich spouse. Think Aspen on the beach.
“$6-$700,000 is middle class workforce?? Well I would say is really is different there… As in completely detached from reality. Wow!”
Why are those fools paying so much for vail/aspen, Colorado? Sure the mountains are beautiful and the ski is great in the winter. Nice restort town but $500k for a 2/1 house? LOL! At least one can rent out a room for around $700/month. Is it the same in Santa Barbara? What fools will spend $500k when the lucky renter gets to share the 2 bedroom house(or condo) for $700 a month which is a fraction of the cost of owning?
“Nice restort town but $500k for a 2/1 house?”
500K buys you a studio condo in Aspen. Try 1 mil for the 2/1.
Fiscal Stimulus Smoke and Mirrors
http://www.minyanville.com/articles/C-jpm-fre-fnm-wfc/index/a/15570
All I can say is this: I love these “Come to Jesus” days, and they seem to be coming with greater frequency lately.
It’s days like this that make FBs and J6P cringe, but for some reason I can’t wipe the smile off my face.
– Judge Smales
“You’ll get nothing and like it”
santa barbara is one of the sickest communties around…no middle class exists there…its the rich and the working poor who serve them,mostly mexican service workers and a few white business owners….
You call it sick; I call it “full employment economy”.
this is picking up speed…
Hang Seng -2.36%, 24536
1946hours PST
I think we may just have us a global bubble of debt and equity trouble.
A crisis of confidence across international borders is getting some real legs under it.
Its all smoke and mirrors:
The omnipotent nature of the PTB have all got themselves in a corner, and now they gotta find a way out. the efforts, monumental in nature, are unknowable, but foreseeable…
somebody read the tea leaves for me, as the tea in China..they are just about done…perhaps its time for chicken bones.
I put 4 hours into the garden today….the build down continues.
I finally got around to watching the Jim Cramer video from this morning.
http://www.cnbc.com/id/22706231
Wow. Just wow.
It didn’t work on my firefox but did on IE.
I’ll post this tomorrow as well, but DQNews has the LA Times numbers for Los Angeles and other SoCal counties for December (year over year, etc.).
The damage (single family houses, median $, year over year):
Los Angeles County: -9.1%
The OC: -9.8%
Riverside County: -20.5%
San Bernardino County: -21.4%
San Diego County: -13%
Ventura County: -12.9%
Santa Barbara County: -26%
Again, these are median prices, year over year, sales mix can heavily influence the number, yada yada yada, but, like wow! Take a look at those numbers…
Oh… I’m going to love quoting that the Santa Barbara median is down a quarter.
I don’t like medians… but it looks like the CAR is going to be hung by their own petard.
Got popcorn?
Neil
It’s mostly north county going down so far. Still waiting for the South Coast’s ridiculous pricing to subside.
short story:
if CFC is too big to fail, and BAC has SWF money flow, as well as, TAF liquidity… why the deal? Why is the stock still trading? Why havent all the shares been tendered?
This is an insolvent Too Big To Fail Quasi-American bank, swallowing whole the loan book of Countrywide…
This is all coming back to counter-party default risk. The run (err I mean crash) that is being orchestrated is simply beyond comprehension, If you have failed to hit the panic button, it is getting late…the systemic risk is about to unfold at a very quick pace.
I said bear market is true yesterday, but crash was false…this got me thinking about the myth of the slow crash. Now if the FED cuts any sizeable amount, some relief will be provided, but that just sets up a cascading downfall of even greater proportions. The masses are speaking, and they are not ammused.
phew, now back to your regularly scheduled housing collapse.
disclaimer: Long positions in pitchforks and torches
“Appleton-Young added some cautious encouragement for buyers: ‘No one rings a bell at the bottom of the market.’”
That’s not true. The “economists” and PR hacks for the REIC have been seaslessly ringging that bell 7 days a week for the past 8 years!
“Appleton-Young added some cautious encouragement for buyers: ‘No one rings a bell at the bottom of the market.’”
No-one rings a bell at the top of the market.
No-one rings a bell as inventory climbs to record highs.
No-one rings a bell when you sign up for a suicide mortgage.
No-one rings a bell if you’ve overpriced your house.
No-one rings a bell when your foreclosure notice is impending.
Simpleton-Young wins yet another ‘Most Trite, Vacuous Sales-Pimp Statement of the Day’ award. I may even ring a bell to announce it.