Everyone Was Buying Just To Buy
The Daily Camera reports from Colorado. “It’s been a little more than two years since Michael Kirby and his wife put their 3,200-square-foot Longmont home on the market, which is listed at $474,000. And Kirby says he doesn’t expect to sell it anytime soon. Although the house’s fixtures are up to date, Kirby says the 33-year-old property can’t compete with newer homes nearby that are similarly priced and come loaded with builder-offered incentives.”
“‘The people who are buying houses can’t sell what they have,’ Kirby says from his second home in Fiesta Key, Fla., citing recent rashes of foreclosures and widespread trouble with subprime lenders. ‘We’re running into that same situation here.’”
“‘That’s happening here, that’s happening in Colorado, that’s happening in California,’ Kirby says. ‘Things in Erie and Frederick are pretty serious.’”
“Jon and Barb Verson purchased their north Boulder home in September 2007, a decision spurred by the impending arrival of their now 3-month-old daughter. The couple refinanced their downtown condominium and bought a two-bedroom fixer-upper in the Sundance neighborhood.”
“Staying in Boulder was important not only because of proximity to his work and open space, but also because of the property’s value, Jon Verson says. ‘It’ll go flat, but it won’t really go down,’ Verson says of the appreciation.”
“Taking into consideration the rates and the housing prices, people who are in a position to buy a home should not sit on the sidelines, says Janie Henry-Bolger, a Realtor in Longmont.”
“The lower prices, Bolger says, should come back up soon. ‘My job as a Realtor is to keep the public positive, and that’s what I’m doing,’ she says. ‘I think we’re all in the position of: ‘If you don’t own, buy. If you do own, re-fi.’”
The Longmont Times Call from Colorado. “It’s been done in California. It’s been done in Florida. And on Saturday, Longmont tried its version of the foreclosure bus tour.” “Russ Scranton of ERA Tradewind Real Estate, which sponsored Saturday’s tour, said he remembered similar trips in the early ’80s. Back then, homes would even be auctioned off during the trip, he said.”
“‘When we saw the trend coming back again … we got together and said, ‘Let’s try it,’ Scranton said.”
“The city had 574 foreclosures recorded in 2007, according to the Boulder County Public Trustee’s office — more than half the foreclosures in Boulder County last year.”
“About 20 people piled on the bus Saturday morning for a 31/2-hour tour that would visit 13 bank-owned homes all over Longmont. East side, west side — no area was immune. The houses ranged from a nearly new $239,900 property down to a $94,500 home in need of a fair amount of work.”
“‘It shows you different levels of income are having the same problem,’ said Johnnie David of ERA Tradewind. ‘It’s not just the ones that flip burgers.’”
The Rocky Mountain News from Colorado. “Home prices fell in the Denver area in January as the sale of distressed properties drove down prices and few McMansions sold. The median price of a single- family home fell about 8 percent, to $216,950 from $236,000.”
“About 80 percent of the homes sold last month were priced at less than $300,000 as the record number of foreclosures drive down the average and median prices, said independent broker Gary Bauer.”
“At the same time, sales are sluggish at the other end of the market. ‘The McMansions, homes priced at $500,000 and above, are not moving right now,’ Bauer said.”
“New housing sales and starts in the Denver area fell by about a third in 2007 from 2006, according to a report. It’s likely that 2007 was the worst year for home builders in the metro area since Denver’s economy crashed in the late 1980s, said John Covert, who heads the Denver office for Metrostudy.”
“‘Basically, last year was the worst year in 20 years,’ Covert said.”
“When the local economy collapsed in the late 1980s following the bust in energy prices, the population of the Denver area was much lower. ‘Our population is so much bigger and more diverse now, it shows how dramatically the builders have cut back,’ Covert said.”
The Arizona Daily Star. “The worst of the slowdown in Southern Arizona’s new-home market is likely still ahead, analysts said an an annual industry forecast on Friday. At best, they said, the market will hit bottom this year.”
“Local new-home market consultant John Strobeck of Bright Future Business Consultants said the number of new-home permits pulled in the Tucson area will fall to 4,000 this year from 5,098 last year. Meanwhile, the number of new homes sold will fall to about 3,500, a drop of 43 percent from 2007 and the lowest number since 1992, Strobeck said.”
“To help spur on sales, he urged local builders to seek ‘continued price reductions’ and encouraged real estate agents to take fewer listings and list ‘only sellers who are serious and have homes priced to sell.’”
“‘Housing activity and prices are falling sharply,’ said Marshall Vest, at the University of Arizona. ‘Not just nationally, but locally, as well.’”
“Phoenix-area housing market consultant R.L. Brown said the economic downturn in 2007 has forced all analysts of the state’s housing market to revise future projections downward. He added that builders and other home-building-related businesses have to be ‘cognizant of the reality of the marketplace that we’re operating in.’”
“‘Many have sat on their hands, wishing that the market would be different, hoping it would be like 2005,’ he said.”
“‘2008 is going to be remembered, I think, as the year we’ll all want to forget,’ Vest said
The Arizona Republic. “Home prices in several Valley cities are falling at rates not seen since 1990, wiping out equity and making it difficult for those trying to refinance.”
“Throughout the Valley, prices on repeat home sales fell 4.6 percent overall from October 2006 through October 2007. That compares with an overall decline of 3.8 percent for September 2006 to September 2007.”
“The decline is the biggest drop in housing prices over a 12-month period since the February 1989 to February 1990 period, when home prices dropped 5.01 percent, during the last real-estate recession.”
“‘It’s not just a matter of too many houses on the market,’ said Karl. L. Guntermann, real-estate professor at W. P. Carey School of Business. ‘It gets into the sub-prime-mortgage problem, affordability, foreclosures, and that has a big impact on people’s ability to refinance if their house prices go down 6 to 8 percent. They may not have any equity, and that may create cascading problems.’”
The Washington Post on Arizona. “‘We’re in so deep that it doesn’t seem like anything will help,’ said Rebekah Ao, a pregnant homemaker who lives in a new four-bedroom home in Avondale with her husband, Otto, a truck driver.”
“The Aos, with $50,000 in income, owe a total of $607,000 on mortgages for two houses they bought since they moved to the Phoenix area about two years ago.”
“In Maricopa County, which encompasses much of the Phoenix area, there are about 13,000 homes in foreclosure, which is more than a sixfold increase over two years ago.”
“They bought their first home in 2005, for $269,000. They paid for it using an Option ARM, which allowed them to make a monthly payment of $850, which was less than what they paid for rent in Los Angeles. Only later did they realize that meant that their loan amount would grow over time, not shrink, as would their payments.”
“‘When we saw the payments were so low we decided to buy another house,’ Rebekah Ao said. ‘With the market going crazy, we figured we could sell the other house in a couple of years.’”
“They now owe $287,000 on the first one and $320,000 on the new home, which they are renting. Their credit card balances, which they once kept at zero, have ballooned to more than $14,000 as they struggle to make ends meet.”
“‘It hurts to know that you are on a road that leads to a dead end,’ Rebekah Ao said. The Aos are weighing their limited options. Foreclosure? A sale that takes in less than they owe? ‘But right now,’ she said, ‘we’re just throwing our money away every month.’”
The Las Vegas Business Press from Nevada. “Amateur night is over and only the pros are going to survive in Las Vegas, real estate observer Richard Lee said last week at Preview Las Vegas 2008.”
“The housing market is in the dumps, partly due to ‘irrational exuberance,’ in the words of former Federal Reserve Chairman Alan Greenspan, which led to an ‘implosion’ of the subprime mortgage market, Lee said.”
“‘The big question is where is the bottom? I don’t know. I think we’re close to the bottom for new homes. We still have a ways to go in resales,’ he said.”
In Business Las Vegas from Nevada. “Lee’s reserved presentation may have been inspired by the speaker who preceded him, Jeremy Aguero, principal of Las Vegas-based Applied Analysis. He, too, had a presentation grounded in reality, acknowledging that economically, 2008 is going to be a tough year.”
“Aguero warned that by the end of the year, there could be more jobs trimmed than created in Nevada. (A day later, it was reported job creation nationally entered negative territory for the first time in four years.)”
“Part of the reason for the potential downturn is a product of the state’s success in diversifying its economy, Aguero said. ‘It’s a double-edge sword. Our economy is more diversified and more susceptible to the ups and downs of the things that are occurring nationally,’ he said. ‘It’s harder for people to grow during a recessionary period.’”
“The construction industry, largely affected by Aguero’s No. 1 trend to watch last year - the slumping housing market - was largely responsible for some of the downturn. Aguero said 11.9 percent of the workforce at the end of last year was in construction-related industries, two times the national average.”
“But another factor was the employment buildup in boom periods such as 2005 and the spending that occurred in those good times.”
“‘A lot of the buildup that we have is a result of huge amounts of unsustainable levels of consumer spending,’ Aguero said. ‘So consumers also are also pulling back. Places like restaurants are overstaffed. It’ll get back, but to imagine that 2005 was by any way sustainable is just unrealistic.’”
The New York Times on Nevada. “Home prices in the North Las Vegas neighborhood of Brenda Harris have fallen 20 percent to 30 percent. The builder who sold her a new three-bedroom home on Pink Flamingos Place for about $392,000 in 2006 is now listing similar properties for $314,000. A larger house a block down from Ms. Harris was recently listed online for $310,000.”
“But Ms. Harris does not want to leave her home. She estimates that she has spent close to $40,000 on her property, about half for a down payment and much of the rest on a deck and landscaping.”
“‘I’m not behind in my payments, but I’m trying to prevent getting behind,’ Ms. Harris said. ‘I don’t want to ruin my credit.’”
“In addition to the declining value of her home, Ms. Harris will soon be hit with a sharply higher house payment. She has an option adjustable-rate mortgage. She is making the minimum monthly payments due on her loan, about $2,400.”
“But she knows she will not be able to pay the $3,400 needed to cover her interest and principal, which she will be required to pay once her loan balance reaches 115 percent of her starting balance. And under the terms of her loan…she would have to pay a prepayment penalty of about $40,000 if she chose to refinance or sell her home before May 2009.”
The Reno Gazette Journal from Nevada. “A flood of foreclosed homes presents prospective home buyers across Northern Nevada with new options the likes of which have never before existed.”
“‘It’s absolutely unprecedented,’ Cheryl Taylor of Ferrari-Lund Real Estate in Reno said of bank-owned dwellings for sale. ‘I have quite a few in the Multiple Listing Service and almost as many waiting for the bank to get a price on.’”
“As of last week, there were 6,492 homes on the MMLS in the greater Reno-Sparks-Carson City-Fernley-Fallon region with an absorption rate of 18.3 months…more than three times longer than at the height of the housing market three years ago.”
“With the number of mortgages in default adding homes to the total, real estate agents like Karen Greathouse of Dickson Realty, who specializes in foreclosures, are feeling the strain.”
“‘The system is overloaded,’ she said. ‘Three years ago, the business didn’t exist in Northern Nevada. You’d get 30, maybe 40 listings a year. Now, the numbers are just staggering. We had a mob frenzy then, everyone was buying just to buy, thinking (the market) wouldn’t do anything but go up. We all know that’s not the case now.’”
“Greathouse said she has foreclosure listings in a wide range of neighborhoods, from Somersett in northwest Reno to Saddlehorn in the south suburban zone to golf course-bordering properties in Dayton.”
“Broker Ken Wiseman said his listings range from $700,000 homes to $70,000 condos. ‘It doesn’t seem like anyone’s immune, except maybe the ultra-rich,’ he said.”
“Residents who have gone through home foreclosures compare the experience to an earthquake, a flash flood or even a death in the family. ‘It’s a nightmare,’ said Shannon Churchwell of Sparks, whose monthly payments on a condo soared from $772 to $1,700 last year as the result of an adjustable rate mortgage.”
“‘I have to take responsibility because I didn’t read the fine print and didn’t fully understand what I was getting into. But it was still a shock. It was a draining and frustrating process to renegotiate the loan, get it modified and get back to where we could afford to stay here,’ she said.”
“Churchwell bought just about two and a half years ago with no money down by using an interest-only loan for a first mortgage and taking out an amortized second mortgage. The loan rate was frozen for two years, but she thought it would be three years before the rate adjusted.”
“‘My first mistake was thinking it was three years, not two, and I also never thought the market was going to change so much,’ she said.”
“But in April 2007 her $772 monthly payment went up by $400 and she realized it was going to go up every six months until her interest rate reached 13 percent. She said she tried to refinance but couldn’t get a deal that kept her payments low. She then put her condo on the market where it sat from May to September.”
“‘A lot of people looked, but I had no offers,’ she said. ‘I went back to the lender, but by then I was paying a mortgage that was close to the value of the condo. I was getting upside down on the loan.’”
“‘The lender kept saying my paperwork was in progress,’ she said. ‘I found out that because I kept up the payments, even though it was a hardship, my paper was put at the bottom of the pile. People who were defaulting were the priority.’”
“‘I was about ready to go into foreclosure,’ she said. ‘I was ready to walk away.’”
“She went to Reno Credit Builders, which was able to negotiate with her lender to get her loan modified. The new loan reverted to the original payment for three years. The adjustable rate still looms beyond that, she said.”
“‘It was worth it to buy time,’ she said. ‘I hope to sell or refinance within those three years.’”
‘Pinnacle Las Vegas was recently slapped with a class action lawsuit by frustrated buyers. The proposed $740 million condo-hotel development at Tropicana Avenue and Cameron Street was first announced in 2005. Three years later, however, the dirt site remains bare.’
‘Our initial review is that this action is without merit,’ said Cynthia LaVasseur, an attorney representing defendants. ‘We are going to file an action to dismiss.’
‘But right now,’ she said, ‘we’re just throwing our money away every month.’
But I thought renting was throwing your money away! ;^)
VERY good catch, Da Bears! Bravo! Wow, now FBs are talking about “throwing their money away”. Score one for the HBB.
Has the same article been posted twice, or is that the second place I’ve seen that?
These people are under tremendous stress. I’ll be they are kept awake at night, and see no future. “It hurts to know that you are on a road that leads to a dead end,” Rebekah Ao said.
J6P doesn’t think things through for themselves, and doesn’t read. So what happens when these people hear from a friend, neighbor or relative who walked away that they can live decently on their income while renting a house for half what they are paying now?
The mortgage disaster could come to be seen as J6P’s revenge. The rich felt free to ignore their obligations to the rest to get richer? So why should J6P meet his obligations to those with mortgage investments?
Expect some country music songs.
“Expect some country music songs.”
I got one already! It goes like this:
Oh, lenders suuuuck,
and mortgage brokers suck as muuuuuuch,
if not more, evennnnnn,
and realtors are wretched and I hope they allllll
are teleported to Helllllllll,
stapled together to developersssssssss,
with those big ugly heavy duty staple gunnnnnssss.
Now, don’t get all critical of my lyric skills. It’s not that bad, if you heard it sung. I could even put my cutest cowboy hat on, with the lucky chicken feather poking through the crown.
Good one, Olympiagal.
I guess they’ll be adding a line to the old country music joke:
Q: What do people hear when they play a country music song backwards?
A: He got his job back, his wife stopped cheatin’, his dog came back to life, his truck started up, and Countrywide refinanced his home out of foreclosure.
Apologies to the “Boss”
They’re still trying to sell those condos
But buying didn’t run in my veins….
I hear she bought a house up in Fairview
And a mortgage she’s trying to maintain
Well if she wants to see me
You can tell her that I’m easily found
I’ve got a spot in the Housing Bubble Blog,
Not in a forclosure on the edge of town……
I had to LOL@ that one. Now home buying is throwing your money away, and renting is the smart deal. What a change from when I first started looking at this blog, has it been 3 years already?
Hey Vegas…
As if your economy falling apart wasn’t enough, now quagga mussels are gumming up the hydropower @ Hoover Dam, that lights up your neon…
These clingers are breeding like underwater rabbits, and really dig the 24/7 Vegas lifestyle.
_________________________________________________________
“Invasive quagga mussels are adapting well to life in the desert, especially in Lake Havasu, where scientists have determined their reproduction rate is three times that of quaggas that infested the Great Lakes region years ago.”
http://www.lvrj.com/news/15502852.html
Vegas is headed for some heavy payback. It would be a dream come true to see all that neon turned off. What a blight that place is.
No way, the neon signs make the best hollywood montages.
I visited Hoover dam. Their charges for parking and entry are too large for the kind of entertainment they provide which is zilch. There is nothing much to see by paying them. Just drive through the Nevada-Arizona highway, what you see from your car window is more than enough!
The tour of the dam itself was well worth the price of admission ($0) when I went.
The tour is well worth the price. It’s an amazing feat of engineering, and seeing it from the bottom is 20X more interesting than just driving over it.
Agreed, looking up at the height of the dam was amazing. My favorite place to visit in the Vegas area.
my kid loved the dam tour more than anything when he was about 6. Welcome to the dam tour, I’m your dam guide, yada yada… his introduction to a whole new world of acceptable swearing.
The tour is well worth the price
“There is enough concrete to build a 8-lane highway from Los Angeles to New York”
Love the inside tour - don’t know if its still running - we did it in 2001, but when we went back a couple of years ago, they’d stopped doing it ‘because of 9/11″. Bummer.
If its open again, do it!
It’s a lovely cool 61 degrees f down there - a perfect compliment to the 115 degree carpark and surrounding area.
My dad took me there. Giant dams! Enormous buffets! Vegas was great, and walking around the Hoover Dam was a big part of it. We also, if you must know, visited the Grand Coulee. I don’t know if you can get near any engineering marvels in our post-9/11 world. As Noam Chomsky says, we have to keep children from getting interested in Science and Technology, as the study of these things invites them to think for themselves.
My dad helped wire the Glen Canyon Dam. He said it was an eerie experience, all the water leaking through the concrete. They’ve had a lot of problems. Not to mention they flooded one of the most beautiful places on earth.
Quagga me out, immediate or cancel, fill or kill, all or none, on the open:
Never trust a mollusk market. It’s a dam shame.
Especially gun mollusks, like Bonnie Parker Dam.
http://en.wikipedia.org/wiki/Gun_moll
“Irrational exuberance” and “unsustainable levels of consumer spending” are in the main post and not in our comments? Yikes, it looks like the MSM is catching up to us!
“When the local economy collapsed in the late 1980s following the bust in energy prices, the population of the Denver area was much lower. ‘Our population is so much bigger and more diverse now, it shows how dramatically the builders have cut back,’ Covert said.”
What’s this guy saying? That he’s seeing how many people are out of work that were employed in construction and real estate?
One thing about the housing bust, it’s certainly taking away the camouflage of “prosperity” here in the US. Where are the jobs? What do we really produce? We couldn’t go on selling houses and “stuff” to each other. Somewhere along the line, people actually have to produce viable goods and services.
Preach it, Palmetto!
A sign of the times. I stopped by a QDoba yesterday (a burrito place much like Chipotle). The windows were being cleaned by a windows cleaning service, and the cleaner was not an illegal (I wish I could say the same for the food preparers inside), In fact, it was a fairly clean cut guy.
Another data point: our local city council is going to pay a small business about $900,000 to relocate to Loveland from neighboring Longmont. This small business has about 100 employees and manufactures fancy home alarm and lighting control systems. They are “promising” to add about 400 new jobs by 2012, with an average pay of about 70K. I wonder if there will be a follow up story in the local paper 4 years from now, reporting that they only hired 50 people, and are paying them $12/hr.
Given current trends in the business community in America, I would say that is fairly accurate assessment:
350 x $40,000 per year (benefits included)
45 x $100,000 per year (mid-managers and techs)
4 x $250,000 per year (senior management)
1 x $8.5 Million per year (entrepreneur and Mgr.)
averages out to about $70,000 per year.
Reasonable except for the CEO pay. A fairly typical small public company that size pays the CEO about $1 million/year plus maybe a $250K bonus and another million in stock. So it’s more like $2.5 million than $8.5 million.
But what’s a few million between friends?
I’m not sure that vNet even has $8.5 million in sales yet.
AFAIK vNet is not publicly held. It was founded by the same guy who founded Colorado Memory Systems (CMS), which was eventually sold to Hewlett Packard. This no doubt has given vNet some credibility, but there is no guarantee that lightning will strike twice.
On the other hand everything CMS used to do has been offshored, and the CMS building in Loveland was sold to the school district at a steep discount (because there was no one else to sell it to).
re: the window washer
last weekend the wife and I visited her grandfather in New York. he took us to a nice restaurant in Bayside (Pier 25, I think–it was good) and commented that 3 or 4 months ago there had been a number of female waitstaff, but now they were all men. I noticed that the waitstaff all seemed to be Hispanic, except for the head guy, who was tall, pale white.
My immediate conclusion was that the illegals are starting to get pushed out of other jobs and so the men showed up to wait tables… pushing out the women. (It’s one of those places that probably prefers having male waitstaff, but when the labor market is tight, they’ll take what they can get.)
(Btw, they were short, ruddy guys–they didn’t look PR to me. ‘Riquenos are US citizens and as such have more employment options.)
What do we really produce?
I ask myself that every time I ride my bike through a strip-mall parking lot filled with tanning & nail salons, scrapbook stores and Starbucks.
Scrapbooking! That’s it! Scrapbooking was the coal mine canary, the red flag, the pachyderm aloose in the livingroom. When they started building stores full of pre-cut polymer doily stick-in photoframez(R) in 87 shades for $15 for a package of three. That was the tipoff that we consumers had stepped off the path somewhere and wandered into the wilderness for a Very Long Way. Scrapbooking. Scrapbooking! Scrap (scrap) (scrap) (scrap) (scrap)… book (book) (book) (book) (book)… ing (ing) (ing) (ing) (ing)…
(you get that, right? The echo thing?)
White trash “activity” gone mainstream.
Gonna get hosed along with the `yoga studios’ and `candleshops’ and `doggie spas’.
And martial arts studios. They want you to sign up for a 1 year contract (or longer) for $100 per month!
No, not the candleshops! Why God?! Whyyyyyyyy?!!
I was disappointed to discover that both of my local malls (Riverside and Topanga) don’t have bookstores. Not even little ‘express’ ones.
So…I can buy a sweater for my dog, or a Swarovski crystal reindeer for next xmas, a custom cookie for my sweetie, or a Hello Kitty back pack for my friend’s little girl (although, secretly, its actually for me)
….but I can’t even buy a magazine to read while I eat in the food court.
No wonder this country is going to the dogs
speedingpullet -
I think that is less about educational aspirations or reading desires of the American public than to do with the economics of book selling.
Competition from the big book stores and on-line book sellers have made the little stores less profitable. Malls often push them out in favor of stores with higher margins.
The tanning places are offering 3 tans for $15. DESPERATION.
Looks like the “next stop: skin cancer” look is (finally) out.
“Bling” and “grillz” have peaked, too. Interesting to see how “urban culture” as a commodity will fare. Outlook looks bearish, but after a couple of recession quarters, J6P, Jr. might start buying “the authentic voice of the streets” again. Sort of a pull back, consolidate, then break out again kind of move.
Weird thought (and I know this could be controversial)–you know how there is a relationship between hem lines and the economy? I wonder if there is a relationship developing between skin tone and the economy. Tan man out, pasty man in? McCain and Obama both look fairly pale relative to their underlying skin tone. (Glamourpuss Michelle Obama still sports a rich chocolate tone, however. Though this is a far cry from baked.) In McCain’s case it (the paleness) makes him look positively geriatric.
How will Crist’s Florida Sunshine tan play, I wonder? His name was bandied about a lot as veep, but not so much now.
That must be it. Its pretty evident here in Loveland.
I have never understood the “mystique” of Boulder. Those not familiar with it could be forgiven for thinking that its some sort of paradise or maybe a tony neighborhood like Bel-Air. IMO, it looks like Santa Ana, Calif. Lots of old, run down houses, apartment buildings and strip malls. Lots of people who don’t speak English. And a college full of spoiled brats who like to riot every year.
I did my graduate work in Boulder. Loved the campus, never thought the town itself was all that great. Have friends there who think it’s very special, but they all came from big cities. It’s very overpriced and has an elitism about it I never liked. It has a reputation for outrageous liberalism.
It has a reputation for outrageous liberalism.
Ah yes, the People’s Reublic of Boulder. Berkeley in Rockies.
So don’t go there if you don’t like it. Sorry some uppity people actually want to preserve what is beautiful, and not pave, drill, mine, imprison, torture, oppress or otherwise destroy every single thing in the world.
Too late. As I said, Boulder reminds me of the not so nice parts of Orange County, like Santa Ana.
And I don’t go there unless I have to.
I was there for summer classes.
Theatre Arts.
I drove from LA and drove back.
Boulder was full of good looking guys.
I saw Chuck Mangione at the Red Rocks amp.
Went to a biker party out by Silver City.
Saw the Stones in Ft. Collins.
I also burned half my long hair off while lighting my sister’s oven.
Ah, what a life.
I might add that I’m an outrageous liberal - lol
Awfully pretty views there, though. Of course, pretty much all along the front range, you can get some spectacular views.
Ok, I’ll admit that the Flatirons make for a nice view.
hey, hey, hey,
be nice, that’s my town. we’re gonna impeach bush and cheney for gods sake.
I forgot to mention there actually are some cool people there…
“we’re gonna impeach bush and cheney for gods sake”
A town is going to impeach bush and cheney? Wow, you people have really gone off the reservation! Please make it stop…Mommy
I have never understood the “mystique” of Boulder.
I think it’s because Robin Williams lived there in the ’70’s when he was an alien.
The only thing worth visiting in Boulder is the Ome Banjo factory.
What they forget to mention is that in the ’80s houses in Denver were much more reasonably priced — and they still crashed. Now house prices in Denver have been driven up by easy credit, the telecom boom and people relocating from CA.
Denver is like the heartland without water. Prices here shouldn’t be all that much more than in Omaha.
Denver is like the heartland without water.
Metro Denver gets about 25% of its water from acquifers (wells), which are anticipated to run dry around 2020. A lot of people will be kissing their thirsty bluegrass lawns goodbye.
A lot of ppl have the misconception that the Denver metro area is beautiful, mainly from pics of the mountains. Outside of the foothills, Denver is flat with almost no water, trees, or vegatation, except for what is planted and watered. I was shocked by its brutal ugliness, especially outside the City.
Back in the day, people committed suicide due to lack of trees. No kidding. People would travel days just to see one.
A few years ago I had interviews in Salt Lake City and Denver lined up in succession, I had never been to either. I was frankly stunned at however beautiful SLC was and then even more stunned at how but ugly Denver was.
I’d take SLC over Denver in a heartbeat. SLC is one of the nicest cities I’ve been in, Denver one of the worst (and no, I’m not Mormon, no bias from that).
Denver does have some good points. Low taxes, relatively safe, driving distance to beautiful areas, clean, sunny weather, etc. It’s just that looks (outside of the front range and mountains), architecture and diversity are not its stong suits. Im from the East coast which has lots of trees, water, and vibrant urban areas. I miss it.
A lot of ppl have the misconception that the Denver metro area is beautiful, mainly from pics of the mountains. Outside of the foothills, Denver is flat with almost no water, trees, or vegatation, except for what is planted and watered. I was shocked by its brutal ugliness, especially outside the City.
Yeah, everybody thinks that its a pine tree forest. Some parts are nicer than others, but those are mostly the areas with lots of planted trees.
My brother xeriscaped his front lawn in Denver so he didn”t have to mow the grass anymore. If only people knew you could be green and lazy at the same time…
I have friends with a place in Genesee. They just let nature take its course. Express a desire for harmony with the surrounding open space and your love for the natural envirnoment, and it will get you an extra hour on the couch on Sundays.
We had a Xeriscape backyard in our rental house. Maybe it’s because I’ve never had a yard before, but that thing was the biggest pain in the rear to take care of. Give me a patch of grass I just have to mow every other week and call it a life.
diversity are not its stong suits
What do you mean? We have tons of illegals here. Viva la raza!
I grew up in DC and lived in Atlanta where there are large concentrations of almost any minority group conceivable, lots of different languages spoken, etc. The different neighborhoods on the East Coast each had their own unique vibe. Denver is very homogenious. Whenever I fly back and forth between Denver and East Coast cities, the differences in demographics is shocking. Also Denver is dead after 9 pm on weekdays. In DC or Atlanta, something is always going on at any hour. Im a night owl, so it is hard to get used to. Yes, we have illegals here. I guess thats Denver’s version of urban.
“We had a Xeriscape backyard in our rental house.”
Xeric and native are not the same thing. Xeric is low water, but can still need lots of care and even relatively lots of water. Native plants will eventually flourish to the point that they crowd everything else out and do well on rainwater, as they’re in their home environment.
http://www.gimmegreen.com/home.htm
“They bought their first home in 2005, for $269,000. They paid for it using an Option ARM, which allowed them to make a monthly payment of $850, which was less than what they paid for rent in Los Angeles. Only later did they realize that meant that their loan amount would grow over time, not shrink, as would their payments.”
I don’t believe anyone is this stupid. A calculator would have shown them in seconds that their payment wouldn’t cover the loan and interest. They just wanted to get by paying as little as possible to free up more money to buy that second property to flip.
How many millions of Americans did this, trying to get something for nothing? Somehow, the figures put out by Wall Street sound way too low.
This shows the problem in Colorado. House prices in $/square foot didn’t get all that far out of line. What happened was that people bought bigger houses than they could afford, and builders built houses that were too big.
Unlike CA this problem won’t be so easily solved by prices going down. Those houses, even at lower price points are just too big. Too much $$ to heat, too much $$ to maintain. Expansive soils, poor construction, it’s all built into the market here. Not only will prices go down, they’ll likely fall far below the cost of construction. What does get built in the future will hopefully be better constrution, smaller and more energy efficient. For 1/5 million you should get a house that is big enough for a family of four and can generate more energy than it consumes, not a giant energy sink built of chipboard.
Is anything not built out of chipboard and tyvek these days?
Nothing I have seen. Even the high-end rebuilds that I have seen under construction here in SM are chipboard and tyvec. These are houses that were going for $3 million and up in 2006.
That’s the second time I’ve seen this comment (or similar) posted. Can anyone tell me what should be used to wrap a house other than OSB and Tyvek? In cold weather, there should also be another “wrap” as I understand it, but that would go over whatever mystery material is supposed to be used to over the frame.
My first house built in 93, used plywood sheathing. Nobody was doing that anymore, even back then. I just had another house built in 2005- and it was built with plywood as well. There are still people who build the old way.
Oh, and I was also under the impression that OSB is stronger than plywood along the plane of the sheet. Personally, I would rather use plywood for, say, a floor but for the side of a house where the strain is along the sheet instead of into the sheet, I thought OSB was preferred.
But I would like to know what is the best option for this type of application.
I suppose that OSB is “green” in that it allows leftover scrap to be recycled into sheets. Whether or not it is better time will tell.
Tyvek certain has its use as a weather proofing wrap, but I have seen new construction where it is used in place of playwwod and OSB.
I’m seeing more and more adobe, strawbale, earthbermed, etc., but it’s mostly owner built and not in Subdivision Nation.
I’m trying to build an earth-sheltered house myself and am hunting for property near my current house. I want to keep my short bike-ride lifestyle, which means I need to stay in the city or close to it. Trouble is the only development going on is developers who won’t let you build anything but the toothpick/tyvek junk the neighbors have.
I’ve been looking at These guys they claim the construction costs are comparable to standard (I suppose that depends heavily on the cost of concrete in your area) but once you realize this is a house that won’t need maintenance for 100 years and has a lifespan that could reach 1000, you can’t bear the thought of one of those crappy wooden above-ground things.
I figure when I go to sell it, assuming I need to, I’ll just post a years worth of utility bills along the wall; I think that alone will seal the deal.
Hey, be sure to run that one by a structural engineer. I suspect they’re more expensive than necessary and a good engineer could tell you a better way. Just my opinion.
This could wind up being a nice thing for buyers down the road. Eventually, fundamentals (medain income?) will dictate the price of the median home. If median houses happen to be 4000sqft McMansions- with 3+ car garages; well that might not be such a bad thing - if they can afford to heat it.
Sucks to be you though, if you paid the full bubblicious price and have to sell into that market-
If you don’t believe anyone is that stupid, you haven’t been to LA.
I agree that they HAD to know it was an option ARM. They bought the place with plans to sell it in a couple years for huge profit.
Look when they moved to AZ… about 2 years ago. Call it 2005. Hmmm, what was going on in PHX 2 years ago? Oh, that is right. House prices had just jumped 100% in the last 3 years.
They came here to play the housing market. They took out an option ARM and bought as much house as they could get. Then they bought another.
Their gamble has failed. Prices are already below where they bought, and falling at an increasing pace.
They will walk, and probably leave AZ (back to CA?)
Bye… don’t let the Colorado slap you in the azz on the way out.
And there were still plenty of cheaper basic houses available back then I might note, these two went the dream house route on a beer budget.
‘My job as a Realtor is to keep the public positive, and that’s what I’m doing,’ she says.
Is that really in the job description? If she can pull that off for another year or two, she is dramatically underpaid.
Funny, that sounds like it is in the job description of quite a number of folks:
Federal Reserve Chairman, fund manager, personal banker, CNBC shill, local MSM RE journalist, St. Joesph statue retailer….
Prostitute
That says it all. She admits her job is to “push” the sale of houses. If you’re buying don’t use an agent, use an hourly-paid lawyer and your own appraiser and inspector (never ones recommended by a real estate agent). Also, don’t sign the contract unless the buyer’s agent agrees to fork over half of the commission paid by the seller. The 2-3% you get will more than cover the cost of your advisors.
Thank you, Tuxedo! I made the mistake of using the home inspector that my agent (a well-regarded Tucson buyer’s agent) recommended. What that guy missed/neglected to tell me about has cost around $3,000 to replace.
Well, sue him! That’s what having a buyers agent is all about.
No, your job is to represent the best interests of your client, whether they be buyer or seller - not to keep the public feeling positive in the face of the carnage that is fast approaching.
Actually, it pretty much is. You don’t go into a shoe store and say “should I buy a pair of shoes?” - Any reasonable salesman would say “that’s up to you.” While I agree that used house salespeople are guilty of misrepresenting the market, it’s really not their job to tell you when it’s a good time to buy a house, it’s their jobs to sell the damn things.
True enough, but you also don’t see shoe salesmen claiming to be “footwear professionals” and encouraging people to buy new loafers because they’ve “researched this!” If they want nothing more than the responsibility of salespeople, they should be content to present themselves as such.
What part of “Realtors are commissioned salespeople who make more money the more the house sells for” don’t people understand?
Actually, my favorite shoe store in the world (Camper) has printed on their bag: “If you don’t need it… don’t buy it!”
(’course that was five years ago when I last bought shoes. I’ve kept to their advice and the shoes have held up well, so…)
I have a very honest realtor friend who is at wit’s end. She works her tail off sealing deals in an area that’s been tough to sell in since 1920.We haven’t had much of a bubble in our area. Which is just fine with me. She is fanatically honest in all ways and seems to be fighting avoid picking up a case of fleas from the company she’s forced to keep. I’m trying to remember if I’ve ever heard her say “it’s a good time to buy”. Well, in our area, maybe that’d be true. If you plan on living in a place twenty years, it almost certainly is true.
But even with such an honest person, the whole relationship is corrupted by exactly what yogurt says. And the NAR spends their membership money going from one state legislature to the next getting into law any restrictions against competition that might fix this industry. I can say it because I’m anonymous here and my friend won’t spot it, but the realtors are dinosaurs and it’s time they got out of the way on the buyer’s side, at least. But they’ve been using the law to institutionalize themselves, the sleazebags, so extricating ourselves from them will be all the harder.
This whole thing goes to show you what licensing is worth: nothing. In the end you have an honest person or you don’t.
Seems as if the urge to buy can’t be suppressed despite housing being seen as an increasingly bad investment. People are at least adjusting their expectations and choosing houses within their budget. Lower end stuff is moving, higher end stuff isn’t.
I wonder how this is affecting the housing statistics? I suspect the NAR will spin this as a rebound in sales and decrease in inventory even though there are continuing price drops, as the McMansions are taken off the market. It will be seen as a housing “recovery”.
Lower end stuff is moving, higher end stuff isn’t.
Same here in Loveland, except that lower end here is now well under 200K. 300K houses are not selling. There is a 450K golf course house across the street that has been on the market for almost 2 years now, empty all that time. The owners (divorced) have refused to drop the price. I wonder what happened to them. They always looked so happy when they took off on their his and hers Harleys every weekend.
they probably rode down here to Florida to look a flipping houses to support their “biker lifestyle”.
It’s been like the 1920’s all over again, but instead of riding in on “flivers” and stopping at auto camps, they come on Harleys and stay at the Sheraton.
“‘2008 is going to be remembered, I think, as the year we’ll all want to forget,’ Vest said”
This would be a pretty funny phrase if they had said it on purpose, instead of being impelled by a clattering nitwittery.
The 2009 model is coming out soon!
…clattering nitwittery.
That, in and of itself, is just a wonderful phrase. Brings to mind nattering nabobs of negativism
“The people who are buying houses can’t sell what they have”
Bullsh*t. The people who are buying won’t sell. It’s very easy to sell a house. Just price it a little below market, and by definition, it will sell quickly (if it doesn’t, you’re not below market yet). The people who are buying just can’t get the price they’re wishing for- but don’t tell us they can’t sell.
This phrase irks me- even for people upside down on their house. In these cases, they can still sell- what they can’t (or won’t) do- is pay off their debt.
I disagree. The FB’s are unable to sell if they are close to underwater and can’t short sell or being money to the closing table.
The house can still “be sold” at under market rate, but it’s the bank that would do the selling, not the FB.
Nothing like being underwater on one house, and being in line to buy the next. Not only do they get real depreciation, they also get to pay transaction costs again including a hefty sum to those ever churning realtors. If they dont want their money, why dont they just send it to me? I’m much more deserving.
And for all you playas that insist Seller pays some or all transaction costs. As stated before, remember that every dollar a Seller pays in transaction costs is a dollar the Seller cant or wont lower the price by. In my opinion, Buyer pays for everything, regardless of the how it is formally documented, and to the extent that transaction costs are incurred, both Buyer and Seller are harmed as its money they cant distribute amongst themselves.
I told the Seller’s Agent on my last offer to keep the whole commission, I was using an attorney and my own appraiser. Her eye’s got so wide I could almost see her brain trying to do the multiplication. Then I made the offer, and she just slumped. She realized the multiple would be zero, as her seller would turn it down. They did.
At an Open House I went to last Sunday, I overheard the realtor woman telling a couple to think positive, accept a loss on their existing POS and buy this ‘better’ house. The couple apparently would have to bring money to the closing if they sold their current house. “Look at it as a total package, even if you lose some money now, you’ll make a lot more money down the road when the housing market turns around and prices go up!” she said. The couple nodded, I don’t think they were persuaded much. They really want to make money on their existing house and the realtor wants to make her commission.
I’m sure they can “appraise” the new house to cover the loss on the old house and roll them a fancy new mortgage to smoke.
I didn’t know there was a “Fiesta Key,” Florida, but the Google tells me that it is an island in the Keys that has been turned into a campground and which is entirely owned by KOA. Unless he is living full time in a tent or RV, I suspect the subject of the quote lives in Siesta Key, which is near Sarasota.
Has to be Siesta Key in Sarasota and right now, it is anything but a Fiesta. Maybe they could have butchered the name more and called it Infesta Key.
‘It’ll go flat, but it won’t really go down,’ Verson says of the appreciation.”
Who in the hell told him that? We have big boom and bust cycles here. The bigger the boom, the bigger the bust. Probably the realtor that admitted his job was to push the sale of real estate, not to work in anyone else’s best interest.
“The lower prices, Bolger says, should come back up soon. ‘My job as a Realtor is to keep the public positive, and that’s what I’m doing,’ she says. ‘I think we’re all in the position of: ‘If you don’t own, buy. If you do own, re-fi.’”
Your “job as a realtor” is to lie your a$$ off to keep those commissions rolling in.
Just remember this quote from Ms. Bolger next time you consider trying to get objective information from a Realtor(tm). She has explicitly told us that doing her job will prevent her from providing such information approximately 50% of the time. You might as well flip a coin.
I sure wish the media would realize this and stop going to them as a source for real estate related information.
The meida is going to them as a source of ad revenue. Letting them spew their lies as news is just part of the trade.
She would’ve made a great Steward on the TITANIC….
“Don’t worry people… all is well. Band…. keep playing”
…Brown said the economic downturn in 2007 has forced all analysts of the state’s housing market to revise future projections downward.
This is not the first time I’ve heard something like this - that the housing madness didn’t cause the “economic downturn”, it was actually the other way around.
I’m curious to see in a few months if that’s the way a lot of people remember it, “The economy went bad and so we couldn’t sell our house, etc, etc”
On the next run up in 2022 they will say it. They will probably blame Bush for wrecking the economy (not entirely true) and that will be the size of it.
Of course maybe the next president will get blamed.
Everyone will have forgotten the credit bubble caused all this madness by then.
“Home prices fell in the Denver area in January as the sale of distressed properties drove down prices and few McMansions sold. The median price of a single- family home fell about 8 percent, to $216,950 from $236,000″
I am afraid this statistic is simply wrong. According to many local Denver realtors, the area never saw a run up in prices similar to California, Arizona, and Florida. Therefore, according to many local realtors, prices in Denver (and other nonbubble cities) cannot come down.
There is no housing bubble here – only in other places that are far far far away!!!!!
“Sorry Roga, You Tiga Now.” Couldn’t help it.
Concur, no bubble in Denver. Buy now or be priced out forever.
“Project lifeline” = “Project free-month’s rent”!
Let’s try that post again.
“Project lifeline” = “Project free-month’s rent”!
http://news.yahoo.com/s/ap/20080212/ap_on_bi_ge/mortgage_mess_rescue
I just heard this on cnbc. It won`t do a thing, as we all know. All this is doing, is retarding the calendar back one month, which does nothing. Doug, Let us know when its a good time to buy in your area. One of my dads golfing buddies “doctor” has a condo up there on Hwy 105 called Estoila or something like… that he bought a few years, he said the value has been going up like crazy. I wounder about now.
lane
“Local new-home market consultant John Strobeck of Bright Future Business Consultants said the number of new-home permits pulled in the Tucson area will fall to 4,000 this year from 5,098 last year. Meanwhile, the number of new homes sold will fall to about 3,500, a drop of 43 percent from 2007 and the lowest number since 1992, Strobeck said.”
4,000 permits -3,500 sells= 500 homes overbuilt? I bet the builders will have learned their lesson before that get in that much deeper.
Sorry to break the news, but Tucson area builders are very slow learners.
Sorry to break the news, but Tucson area builders are very slow learners.
Sadly too, the longer it takes them to learn, the more beautiful Sonoran desert gets plowed under. It makes me want to cry.
I’m not very fiscally fit and can’t swim, throw me a lifeloan!
If 2007 was the year that sucked, and 2008 will be a year to forget, then what moniker will they give to 2009?
“‘2008 is going to be remembered, I think, as the year we’ll all want to forget,’ Vest said
2009 = The year that really sucked!
2010: A Housing Space Odyssey
2010 = Another year that really sucked.
2011 = ¡No puede conseguir peor!
This is why word for word translation doesn’t work.
Try-
No se puede empeorar.
or
No se puede poner peor.
2009 = the suckiest suck that ever sucked
March 3 shuts the door on the spring buying season.
Home buyers typically must get mortgage insurance when they put down less than 20 percent of their home’s value.
Starting March 3, MGIC, will require at least 5 percent down on homes in so-called restricted markets. They include the entire states of Arizona, California, Florida and Nevada and major metro areas such as Washington, D.C., Detroit, Chicago, Boston and Atlanta.
Homeowners hoping to insure condos will have to put 10 percent down.
The changes will affect business in four full states and about two dozen markets in 14 others and the District of Columbia. MGIC expects them to result in fewer new policies being issued, it said in a filing with the Securities and Exchange Commission late last week.
The company also will not insure mortgages requiring little or no documentation or investment property loans in the restricted areas.
The Milwaukee-based insurer will require higher FICO credit scores as well. Homeowners in the restricted markets who put at least 10 percent down will have to have FICO scores of at least 620 out of a possible 850. If they put less down, their scores will have to be at least 680.
The areas were chosen based on the company’s own data, home price indexes from the Office of Federal Housing Oversight, the National Association of Realtors change in median home prices and other sources, according to MGIC’s Web site.
In January, the company instituted other changes to limit coverage of higher risk loans and borrowers with poor credit, by requiring higher credit scores and raising premiums. The company said then it was limiting business in Florida and California, but the latest announcement greatly expands that.
MGIC stopped insuring loans for borrowers with credit scores below 575 last month. MGIC estimates its average FICO credit score for new loans is about 700, out of a possible 850.
The company announced late last month that it could pay $2 billion in claims this year, up from previous estimates of up to $1.5 billion. MGIC blamed rising delinquencies and claim sizes for the increase in expected payouts.
MGIC had about $197 billion in primary insurance in force covering 1.37 million mortgages as of the end of September.
“About 20 people piled on the bus Saturday morning for a 31/2-hour tour that would visit 13 bank-owned homes all over Longmont.”
Ah, yes, a three hour tour. Hopefully the people on the bus were not shipwrecked in a forest of falling knives.
Had dinner with a big-shot from one of the largest title companies in Northern Nevada. He told me in his 40 years in the business he had never seen so many foreclosures and that fraud was rampant.
The Northern Nevada real estate market is falling apart like a two-dollar suit case.
And no doubt he was shocked, just shocked to discover these facts!
Here in Central Arizona I’ve been keeping my eye on a housing development ever since someone mentioned to me that their son-in-law was getting really anxious after buying there. Here’s the story so far:
Saturday, February 09, 2008
Empire still offering new homes for sale
Homeowners in Mountain Gate subdivision in Clarkdale want answers. They want to know if the subdivision owner, Empire Construction, has filed Chapter 11 bankruptcy. They want to know about their new-home warranties, the subdivision’s clubhouse and infrastructure. They’d also like to know if they’ll be allowed to meet officially as a homeowners’ association. In late January, The Verde Independent ran a story that Mountain Gate had shut down, operations were frozen and the company had pulled off site. Rumors circulated this week that Empire had filed for Chapter 11 bankruptcy, but that hasn’t been confirmed.
“We have not heard anything,” said Sherry Bailey, director of Clarkdale’s Community Development department. “They were supposed to file on Tuesday, but we don’t know if they did. Our attorney is in contact with their attorneys.”
Rob Pecharich, Clarkdale’s town attorney, had not returned phone calls by early Friday afternoon.
Bailey said that she thinks the town is in pretty good shape with the subdivision, as far as bonds and completed infrastructure are concerned.
Casey Samsill answered the Mountain Gate office’s phone Friday morning. “I’m here to do what I can to close this community down in the next 60 days,” he said. “We have four homes available for sale,” Samsill said. Samsill is regional sales manager for Rynes Company, which was hired by Empire to manage sales of homes in Mountain Gate. He could neither confirm nor deny that Empire had filed for Chapter 11. “I’m not aware of anything that is concrete,” Samsill said. He said he has heard a lot of rumors. Josh Stackhouse, a Mountain Gate homeowner and member of the subdivision’s homeowners’ association, said he is trying to get 47 signatures of homeowners on a petition. He explained that the signatures might be the only way the homeowners’ association can officially call a meeting. “We aren’t in charge of the homeowners’ association,” Stackhouse said. He explained that Empire is still the majority shareowner in the subdivision, and the homeowners must have the signatures to call a meeting without Empire’s approval. “When a builder goes into Chapter 11, they don’t have to communicate with you,” Stackhouse said.
“Hope Now.”
“Project Lifeline.”
“More B.S Coming.”
Add your own catch-phrase.
My wife came up with, what might be, the reasoning behind all of this. Anybody who has followed the real estate boom and bust on this board, knows there is little chance the majority of FB’s can be rescued by some bullsh*t plan like “Project Lifeline” when he/she got a mortgage based on incredibly fraudulent information like an income of $100,000 when their true income was $20,000. However, they will get another 30 days free rent and seeing as the property they occupy, and will abandon, will no doubt turn into a foreclosed eyesore for at least 6 months to a year, these banks are not really taking any risks.
So what’s the reason for this constant propping up of the real estate market? How about this: Bush and the Godfather (Paulson) are simply plugging holes in the dam, hoping this administration can fade away when the Dems, who are obviously going to take over both houses in November (I predict with BIG majorities but maybe not the Presidency) get stuck with all the problems.
The usual musical chairs game the Washington hacks play.
Mike,
i think you’re right…this is all about buying time now, until the current admin can get out of Dodge, but I think reality is working against them. Even the NYTimes in it’s headline today acknowledged that the Alt-As and primes are heading underwater…i expect they will get tarred and feathered on this one.
I can think of one good reason:
Homeowners are so stupid they are just abandoning houses without contacting the bank.
They don’t even realize they could probably stay in the house for a year (free) before really being booted nor do they realize that the bank may do a short sale or other help.
This whole LifeLine is to try to get into the MINDS of owners that they can get free time and don’t just walk away in the middle of the night.
A little OT and I am woefully out of my league on this blog, but can someone explain the difference between a HELOC and a second mortage? One of the realtors here is trying to “advise” a client to consider a HELOC in order to obtain additional funds. What is that all about. Same realtor told another client not to worry about the client’s impending foreclosure….that the client could walk away from his current home now and feel assured that he could purchase another home (when housing prices are lower) in another year or two with no problem. Doesn’t a foreclosure devastate your credit? Wouldn’t it take quite a while to repair your credit before you could make such a purchase again…not to mention that you would have to have a substantial amount of cash for a down payment?
2nd mortgage… They hand you a check. Fixed or ARM available. ARM adjustments are usually on a fixed schedule. You make fixed PI payments and it eventually goes away.
HELOC… They hand you a book of checks that you use as desired. Always ARM. ARM readjusts whenever prime changes. You make PI payments, that adjust as the balance changes. No fixed payoff date as you can use the checks as you desire.
More like a credit card but secured against your house.
I’m pretty sure some HELOC’s had cards.
My bank sent me a HELOC credit card… it headed straight for the scissors. Don’t want it.
As for the HELOC… balance is $0. Only got it …. “just in case”. Love getting the quarterly statements showing amount owed = $0.00
Our HELOC ($0 balance, we decided against the remodelling and used it only once for an emergency repair during the summer when income is low) had a fixed pay off date of 10 years from when it was issued (don’t know if that’s the word). After some number of years, there was a required payment schedule if it had a balance. And after some point, it can’t go up again, but only down, and, actually it was quite complicated, but now that I think about it, structured to make sure you didn’t mess yourself up. We got it from State Farm, our house insurer.
“The Aos, with $50,000 in income, owe a total of $607,000 on mortgages for two houses they bought since they moved to the Phoenix area about two years ago.”
Ao. Is that txt speak for A-Hole? Perhaps they can sell one of those expensive vowels and pick up a cheap consonant or two…
I watched a few minutes of Paulson this am — and I just can’t shake the picture of Kevin Bacon in Animal House, screaming, “All is Well! All is Well!”
My job as a Realtor is to keep the public positive, and that’s what I’m doing,’ she says. ‘I think we’re all in the position of: ‘If you don’t own, buy. If you do own, re-fi.’”
Hoo Boy, where to start…
It seems to me, that it is just as morally reprehensible, to talk potential house purchasers into a debt bomb, as it is for previous buyers to walk away from one.
Maybe that’s why the term Realtwhore gets used so often these days. “Come on baby, you know you WANT it, just slip on into my groovy house. Everything will be great…”
Why they get more than twenty bucks for turning these tricks I don’t know.
Oh! That’s right. They’re pros. They know their ‘position’.
Mr. Vest, Dude, for people waiting to buy until it isn’t a horrific mistake, this is FAR from true. Expand your mind a bit outside of raw greed. Sheesh.