February 20, 2008

The $100,000 Profit Is Gone

The Pocono Record reports from Pennsylvania. “Real estate appraiser Joseph C. Fisher and Realtor Eileen Chaladoff agree the Monroe County housing market didn’t perform as well in 2007 as in 2006. Total county home sales last year — 2,876 — were down 38 percent from the 3,972 sales the previous year, according to a statistical analysis prepared by Fisher. The average 2007 home price — $182,889 — was about 10.5 percent below the $202,140 average for 2006.”

“Though there were a record 1,253 county home foreclosure filings in 2007, Chaladoff, president of the Pocono Mountains Association of Realtors, said relatively few foreclosed homes were among the 2,341 homes sold by member Realtors. ‘Our foreclosure rate is only 7.5 percent compared to total sales,’ she said.”

“She said the average size of last year’s sold homes was a little smaller than the previous year. ‘The big McMansions — they’re sitting for awhile,’ Chaladoff said.”

“Fisher and Chaladoff both expect home prices to level off within the next few months. ‘Now when they’re selling they’re going to make their profit, but they’re not going to make a big profit like they used to,’ Chaladoff said. ‘The $100,000 profit is gone.’”

“Fisher points to a healthy mix of ranch homes, cabins, mobile homes and so-called McMansions in the Poconos. ‘It’s certainly not going to take a dive,’ Fisher said. ‘The market here is very different than in California, Nevada or Texas.’”

The Derrick from Pennsylvania. “Some real estate agents say 2007 was a good year, while others say it was sluggish. ‘I do think that some people are coming here to retire because it’s affordable and it’s a slower pace,’ said Joyce Woodard of Venango Real Estate.”

“More and more, people from places like California, where housing is considerably more expensive, are finding homes in Venango County with lower prices. ‘We get emails from people who want to buy five or six houses,’ Woodard said. ‘It’s like pocket change to them.’”

“2007 was a sluggish year in Venango County overall, according to Rebecca Bloom of Wilson Real Estate. She blames the slump on the national news about foreclosures. ‘People are afraid to buy houses because of the media,’ she said.”

“Although Cynthia Moon said 2007 was a good year at Gates & Burns Realty, she expects 2008 will be hard on new buyers. ‘I think a lot of people this year are going to be squeezed out of the market. I don’t think they’re going to be able to get loans,’ Moon said.”

“In recent years, it has been easy for new buyers to get breaks when applying for loans, but that ‘easy money led to a mortgage crisis,’ according to Moon.”

“In 2005, Realtors reported record sales of residential properties along the river. One of the priciest areas was Rockmere where homes were selling for $400,000 and $500,000, sometimes more.”

“But now, a lot of riverfront residences are sitting empty and out-of-town owners who are hoping to sell these properties for high prices can’t, Bloom said. ‘I think people just don’t have the extra funds right now,’ she said.”

The Philadelphia Inquirer from Pennsylvania. “Anthony and Lisa Grande’s house stands out in their Levittown neighborhood. ‘It’s the big house,’ Lisa said when giving directions.”

“The Grandes borrowed more than $100,000 - much of it on credit cards - to double its size four years ago because they wanted enough room for their five children and did not want to move.”

“But now, the Grandes are fighting to stay there, having repeatedly fallen behind on their mortgage payments, which climbed from $1,841 to $2,487.”

“When they refinanced in January 2004 from a $113,906 fixed-rate mortgage into a $220,500 adjustable-rate mortgage to pay off credit-card and other debt, they were told - like millions of others - that they could refinance before the interest rate jumped.”

“Then Anthony’s health fell apart, his plans to start a business foundered, and another refinancing did not come through.”

“‘It seems like a black cloud pulled over and stayed there,’ Anthony said during an interview last month, two days before he went into the hospital for the seventh operation in the last four years on his diabetes-stricken body. ‘To be quite honest, we were probably foolish also,’ Lisa said.”

“Lisa recalled a carpenter on their roof during construction stamping a broom and saying so many people went bankrupt expanding their homes. ‘I knew it then. It’s like he cursed us.’”

“Lisa said it’s been incredibly hard dealing with Option One Mortgage Corp. ‘You could never talk to the same person, and then whoever you had next tried to get more out of you,’ Lisa said. She recalled how one service representative told her: ‘I don’t want to hear your hard luck story. I want a check.’”

“Christine Sullivan, spokeswoman for Option One, a subsidiary of H&R Block Corp., said the company’s records show that it followed the proper foreclosure filing procedure for Pennsylvania. ‘We have worked closely with the Grandes since 2005, including offering them several workout plans,’ Sullivan said.”

“Option One has stopped taking loan applications, and its office in Trevose - where Anthony called to refinance - closed last summer.”

“The Grandes showed visitors a photo album that illustrates the construction project from start to finish. To pay for the additions, the Grandes used a $40,000 bank loan and credit cards.”

“In January 2004, they did what millions of Americans did during the housing boom to cope with ballooning credit-card debt: they refinanced, though they didn’t get enough to pay off their credit cards. The new loan - with no income verification, according to Anthony - increased their monthly payment from $950 to $1,841. The introductory interest rate was 7.75 percent for two years.”

“Despite the refinancing in January 2004, the Grandes still had $118,628 of debt on 24 credit cards, according to a bankruptcy filing in October 2005. ‘We probably lost track,’ Lisa said of the number of credit-card checks they used. ‘They just kept sending us checks.’”

“The whole affair has shattered Anthony’s sense of himself. ‘I was always hustling. I always worked. Now I can’t do anything. I feel like a jerk,’ he said.”

From KDKA.com in Pennsylvania. “For now, much of downtown Pittsburgh is under construction. There’s the North Shore Connector project, the PNC office, hotel and retail high rise and the Piatt Place transformation of the Lazarus building into condos and shops - pricey and ambitious projects aimed at revitalizing downtown’s long-decaying urban core of blight and vacant stores.”

“But there are also signs that condo sales downtown have hit a speed bump as more and more units come on market. With PNC adding more units, the Cultural District is delaying its plans for condo construction and according to real estate insiders, others are taking a wait-and-see approach.”

“And while owners have closed on more than half of the 83 units at 151 First Side, six of those units are already up for re-sale. ‘We’re confident that it will pick up. I mean obviously there’s a nationwide housing issue right now,’ Deputy Mayor Yarone Zober said.”

“Despite slower than expected sales, Zober doesn’t believe there’s a glut of condos on the downtown market. ‘We have a unique market, one. Two, we haven’t had traditionally much supply at all. So, any supply at this point to the outside observer might look like an over-supply, but I don’t think we have that at this point,’ he said.”

“At the Carlysle at Wood Street and Second Avenue, half of the 60 units are under contract, but about a third of those buyers are real estate investors and phase two of the project is currently on hold.”

“Buying downtown is not for everybody, especially at the prices these units are being offered - generally more than $200,000. Developers say these buildings are too costly to renovate and they can’t offer the units more cheaply.”

“Still, developers say they’re pleased with the sales and confident that prospective buyers will overcome their misgivings and take the downtown plunge. ‘Many of them are repeat visitors who need to time to adjust to a lot of the nay-sayers, family and friends, people who say, ‘You want to live where?,’ Liz Caplan, an official with The Carlyle, said.”

From WCVB TV in Massachusetts. “The foreclosure crisis is hitting a new demographic. No longer is it just homeowners swimming in debt. Now, those trying to lend a helping hand to those in need are feeling financial pains.”

“NewsCenter 5’s Shiba Russell reported Monday that a local nonprofit developer is working to provide affordable housing, but it’s feeling the crunch. It built 11 homes for $5 million in Newton. Their plan was to sell seven to moderate-income residents and the rest at market rate.”

“‘I think that they were not willing to pay what they thought was too high in a market that was changing,’ Citizens For Affordable Housing’s Josephine McNeil said.”

“Realtor Sandi Fromm said that she had no choice but to lower prices. In the end, its developer, Citizens for Affordable Housing, took a big hit. The market rate homes sold for $40,000 to $170,000 less than the asking price.”

“‘I think if they had come on the market six months sooner we would have been fine, but they didn’t,’ Fromm said.”

From The Day in Connecticut. “Ed Hillyer, still exuding confidence left over from an unprecedented six-year real estate boom, has no trouble talking up this three-bedroom home in the Crescent Beach section of Niantic.”

“It’s a beautiful modular built four years ago on a small lot not far from McCook Point Park, with a huge kitchen, propane-gas fireplace, gleaming wood floors and even a far-off view of Long Island Sound, all for $799,900.”

“But when Hillyer, who owns a Waterford real estate firm, turns to face Tamala Facas of Westerly to tell her about the his-and-her closets in the master bedroom, he does something he wouldn’t have imagined a few years ago, during the height of a local real-estate run-up that doubled the price of many homes in less than a decade.”

“Hillyer makes a concession. Without even being asked. ‘There’s a little issue,’ he says.”

“It turns out that one of the closets had been designed originally as a bathroom. Without an extra bathroom, the upstairs includes no separate area for guests to shower or bathe. So if Facas decides she has to have another bathroom, ‘The seller would take it off the price,’ Hillyer says.”

“Sellers in the region are making a lot more concessions these days. With the supply of houses swelling, buyers are taking longer to check out the market, waiting for the best deals and rarely competing to bid up home values, according to local real estate agents.”

“‘Clearly, we’re in a buyer’s market now,’ says John Bolduc, executive VP of the Norwich-based Eastern Connecticut Association of Realtors.”

“‘Are we in a buyer’s market? I really don’t know,’ says Hillyer. ‘I kind of feel like it’s a little dip in a long trend that’s been going up.’”

“‘Houses that used to be selling in 60 days, it wouldn’t be surprising for them to be on the market for six or nine months,’ says Norm Kraymen, owner of Realty Estates in Groton. ‘I don’t see anybody making full-price offers. People are looking for realistic prices and the best bargain. A lot of homes are still overpriced.’”

“Michael Costanza, a teacher at North Stonington Elementary School, can vouch for the fact that houses have been coming down in price, having spent the past eight months scouring the Internet and trudging through about 35 homes looking for a place to buy.”

“He just had an offer accepted on a three-bedroom home in Lisbon that he knows he couldn’t have afforded two years ago, and he has seen others drastically reduced in price since he started house-hunting in earnest last September.”

“‘One house I looked at was listed at $289,000, and now it’s come down to $259,000 and the owners seem anxious for offers,’ he says. ‘A lot of homes have come down $10,000 to $20,000 since I started looking. … A lot of houses have been around forever.’”

“Costanza says the key to getting a good price is waiting for the right opportunity. For instance, he made an offer $25,000 less than the listing price for his new home in Lisbon and had to wait a week before the seller responded. This was the fourth house on which he made an offer; the other offers fell through.”

“‘Given the market conditions, I was able to have patience,’ he says. ‘I knew the right house would come to me. There are plenty of homes to choose from. The situation is only getting worse for sellers.’”

The Advocate from Connecticut. “Despite a 12.4 percent drop in the number of single-family homes sold last year, Connecticut bucked a nationwide trend that saw the median price fall to $217,800, down 1.8 percent from 2006, the first decline since 1968.”

“Although tax bills are calculated according to property values, the state of the housing market doesn’t have a direct effect on property taxes, said Carolyn Nadeau, president of the Connecticut Association of Assessing Officers and tax assessor for Bethlehem and Watertown.”

“‘People think their taxes are going up or down, but taxes change based on the city’s budget. There is no difference if you do it in an upmarket or a downmarket,’ Nadeau said.”

“Some owners want their homes to be assessed at a higher rate because that could increase the asking price if they sell, Nadeau said. ‘Hopefully, people want to see their property values increase because that’s why we buy homes in the first place,’ she said.”




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168 Comments »

Comment by Butch
2008-02-20 08:01:37

Nadeau said. ‘Hopefully, people want to see their property values increase because that’s why we buy homes in the first place,’ she said.”

I thought you bought homes to live in?

Queue the MSM sob stories of all those who lost money because they wanted to make money on their “homes” instead of just living in them.

Oh well, I’ll take 1997 prices in 2009 or 2010.

Comment by Tim
2008-02-20 08:09:26

People still dont get it. Unless you own mulitiple homes, intend to move to a low cost area, or intend to downsize significantly, rising property values hurt you in the form of taxes, insurance, and transactions costs, especially if you are retired as then you also need to add in inflationary pressures with a fixed income (e.g., companies need to pay more to attract employees to the area while you are no longer on the company payroll).

 
Comment by reuven
2008-02-20 09:24:37

Actually, the first sentence bothered me more:

“Some owners want their homes to be assessed at a higher rate because that could increase the asking price if they sell, Nadeau said. ‘Hopefully, people want to see their property values increase because that’s why we buy homes in the first place,’ she said.”

If I’m paying more property tax than I should because my neighbor talked the assessor into overvaluing the house, I’d be hopping mad. There’s something rotten about that practice. If the government complies, they’re conspiring to fix prices.

Comment by AnnScott
2008-02-20 11:45:00

Actually that comment is so detached from reality as to be hilarious.

NO APPRAISER uses the tax valuation to appraise a property. A tax valuation is NOT a comp. No lender would accept that on an appraisal.

Another idiot thinking what she does has more importance than it does in the real world.

A lot of very stupid people who are completely ignorant of how appraisals are done actually think the tax valuation has something to do with what the place will sell for. These people are called ‘owners of property which has been on the market for ever.’

 
Comment by Bye FL
2008-02-20 11:51:29

Is this why you are selling your vacent lot(s) in Florida and shelving your plans to snowbird?

Comment by reuven
2008-02-20 12:13:24

I’m not selling my Florida land. I paid very little for it. Most of it is zoned Agriculture, we just got 2 acres zoned residential for the 1 house we planned to put on it. (so the taxes for the unimproved land aren’t that much).

I never bought it for an “investment.” I just thought it would be nice to have a custom-built second home there because I spend a lot of time in Central FL on business.

But if the math doesn’t work out, I’ll just hold it. Forever. Maybe I’ll update my will to leave it to the Nature Conservancy.

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Comment by Bye FL
2008-02-20 12:32:58

I am just worried you may run out of money and won’t be able to sell it for much in a few years. I begged my parents for over a year to sell their house, I understood it wasn’t an investment but it could have added another half million to their retirement nest egg and they could have bought a similar house in a few years for a third of what they sold it for. Dad did admit he would have sold any other properties he had.

You should at least rent the land out to farmer(s) or make it a mobile home park. Why lose property taxes?

 
 
 
Comment by Joe Rentor
2008-02-20 14:15:33

This line of thinking makes me want to pay more for Gasoline, so I can charge more for my car when I sell it.

 
 
Comment by Spykeeboi
2008-02-20 09:26:46

That’s a pretty clueless statement from someone (Carolyn Nadeau) who is president of the Connecticut Association of Assesssing Officers. (I’m guessing she has a nice smile.) I am continually amazed by the thoughtless things people say in front of the press. And then I am even more amazed at how the press uncritically repeats their unsound claims. Maybe I’m forgetting how the real world works; it may be time to watch “Office Space” again…

Comment by Seattle Renter
2008-02-20 10:27:04

And then follow it up with “Idiocracy” - since that’s about where we are right now.

 
Comment by Seattle Renter
2008-02-20 10:28:16

And then follow it up with “Idiocracy” - since that’s about where we are right now.

Excuse me, it’s time to go watch “Oww! My Balls!”

“Go away, ‘baitin’!”

Comment by mortigitempo
2008-02-20 21:10:54

My wife and I play Idiocracy all the time off our dvr… It really is a modern classic and a must watch for readers of this blog…brought to you by Carl’s Jr.

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Comment by Doug in Boone, NC
2008-02-20 10:00:45

Rising property taxes and insurance rates was my major platform when I ran for county commissioner in ‘06.

Whenever I would mention that all the increased appraisel of my house has done was to increase my propety taxes and insurance rates, I would inevitably be told that that was a good thing, because it meant that I could sell my house for more. My response would be “but what if I don’t plan to sell my house? What good would rising values do for me?” (Back then, the average price for a house in my neighborhood was $260K; now it is 310K.) I would be given a look like I was crazy or something. I got my a$$ beat in the election, because of a high-bucks “estate development” the powers-that-be were planning to build in my district.

I might try again this year, given the housing/economy meltdown that is going on. I’ve got until noon next Friday to decide whether or not I am going to run again. Right now it’s beginning to look like I am. Maybe I’ll do better this time!

Comment by Tim
2008-02-20 10:04:14

You sound too intelligent to be in politics.

Comment by Faster Pussycat, Sell Sell
2008-02-20 10:37:26

Cream of the crap but it won’t rise. LOL. :-)

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Comment by Bye FL
2008-02-20 11:50:15

This is why I am still waiting for nice big homes to bottom out at pennies on the dollar. First the herd mentality needs to change that houses are not a good investment.

Comment by Fuzzy Bear
2008-02-20 12:04:13

First the herd mentality needs to change that houses are not a good investment.

You are 100% correct. However, when I mention this to the sheeple all I hear in reply is Bah Bah S**t! Sooner or later they will come out of their denial phase.

Comment by Bye FL
2008-02-20 12:35:15

My parents are in denial too. I keep showing them cheaper and cheaper houses and always excuses such as “bad location or ugly house”

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Comment by tampaesq
2008-02-20 12:55:00

well, bad location or ugly house would have still been the case 2 years ago. as long as you’re comparing apples with apples…

 
Comment by Bye FL
2008-02-20 13:36:33

It is apples to apples, they think all the beautiful houses will keep their value cause it’s “special” and everyone wants to own one. It’s the ugly houses no one wants that’s losing value.

 
 
 
 
 
Comment by Kevin Road
2008-02-20 08:02:49

Inflation up and treasuries are starting to rally. Fundamentals no longer apply.

 
Comment by WT Economist
2008-02-20 08:03:23

“When they refinanced in January 2004 from a $113,906 fixed-rate mortgage into a $220,500 adjustable-rate mortgage to pay off credit-card and other debt, they were told - like millions of others - that they could refinance before the interest rate jumped.”

I wonder what fixed rate they could have gotten in January 2004. That’s what’s terrible here.

“Lisa recalled a carpenter on their roof during construction stamping a broom and saying so many people went bankrupt expanding their homes. ‘I knew it then. It’s like he cursed us.’”

Grande doesn’t sound like an Italian name, but that sure sounds like a Neopolitan attitude. Did he give you the evil eye while he stamped the broom, too? Check your horiscope from that day.

Comment by Suds
2008-02-20 08:16:58

I am so tired of these sob stories. Are we supposed to feel pity? Are we supposed to get a cautionary lesson? Why do the media print these stories? Honestly, I would be embarrassed to have my financial stupidy splashed across a newspaper.

 
Comment by Bad Chile
2008-02-20 08:26:15

“Despite the refinancing in January 2004, the Grandes still had $118,628 of debt on 24 credit cards, according to a bankruptcy filing in October 2005. ‘We probably lost track,’ Lisa said of the number of credit-card checks they used. ‘They just kept sending us checks.’”

They were running their own version of “24″, the only way they knew how.

Assuming a minium payment of 1.5% (which I think was the standard back in ‘05), their montly minimum CC payment was $1779. That is their real problem. Assuming good teaser rates locked in, they were spending nearly half of their original mortgage payment just in interest. They were bound to be bankrupt sometime, it was just a matter of when - in this case, when medical problems hit.

What a Maroon.

Comment by MontanaAnna
2008-02-20 08:56:54

Not only that, he’s a moron.

 
Comment by laonlooker
2008-02-20 09:31:15

Wow, with the interest rates that credit cards charge, I can’t even imagine charging that kind of dough. That is the very definition of stupidity if you ask me.

 
Comment by santacruzsux
2008-02-20 10:56:07

I like Bugs Bunny too.

 
Comment by tampaesq
2008-02-20 13:03:46

$118K on CREDIT CARDS??? WTF??? How could they even qualify for that much credit? And here I was freaking out when I graduated law school, moved to FL, and was out of work for 3 mos. while studying for the bar, and ended up with about $9K in credit card debt (all of which was paid off within 6 mos. of starting my first job, within the 0% interest introductory period). What is wrong with people? I haven’t spent that much money on credit in my entire lifetime! They shouldn’t get a discharge. For irresponsible morons like them, that debt should haunt them forever.

 
 
Comment by phillygal
2008-02-20 08:42:44

Grande is an Italian name.

Poor Lisa, I feel so sorry for her. :-(
First, her carpenter puts the malocchio on her, then when she calls Option One the guy on the other end doesn’t offer her a day at the spa and some Oprah cookies with tea.

And at the end of all these insults and black magic, she will no longer be able to tell her friends - and SIL especially, the SIL - that she lives in “the big house”.

Such drama certainly is worthy of Giuseppe Verdi. Lisa honey, go have a cannoli and listen to Connie Francis. (Always works for me)

Comment by Arizona Slim
2008-02-20 09:33:21

This thread is making me laugh too hard. And the fact that so many of these clueless home-dolt stories are from my home state of Pennsylvania isn’t helping.

Comment by salinasron
2008-02-20 11:35:26

” according to a bankruptcy filing in October 2005″

Why are we getting the sob story now when there was a BK filing back in October of 2005?

In this PC world of today these people should be forced to have a money management coach who doles out their money weekly.

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Comment by AnnScott
2008-02-20 11:50:17

Probably a Chptt 13 which means they are still in the bankruptcy. Those cases go on for 3-5 years since there are the court-supervised debt payments.

 
 
 
Comment by Ostriches
2008-02-20 10:52:21

Yeah, it was the carpenter that cursed them and their situation has absolutely nothing to do with their $118,628 credit card debt.

$118,628 IN CREDIT CARD DEBT!!!

 
Comment by SaladSD
2008-02-20 15:30:03

But you’re supposed to think of the children. Yeah, right.. How many local city council hearings I’ve had to endure where folks would whine about such a such a condition near their home, because of concern for “the children”. I’d have respected them more if they’d just say what was really on their mind, that golden cow known as property value. Those annoying neighborhood traffic signs should say “Slow Parents”

 
 
Comment by bluprint
2008-02-20 09:00:41

My personal favorite among the “things that just happened” to these poor folks:

Pennsylvania’s Homeowners Emergency Mortgage Assistance Program helped them get caught up in August 2006. But after spending too much for Christmas in 2006, they fell behind again early last year.

I hate when I spend too much on Christmas and it leads me to financial ruin.

 
Comment by AUA
2008-02-20 09:01:28

It’s like he cursed warned us!

 
Comment by snake charmer
2008-02-20 09:23:03

There is a certain irony in a couple named “Grande” going deep into debt to enlarge their home. On another topic and with reference to the Pittsburgh excerpts, city after city has gone all in on the idea that, in the future, we will be a country of expanding wealth. We won’t.

Comment by Arizona Slim
2008-02-20 09:35:03

The condos in Downtown Pittsburgh is causing more Slim laughter. I mean, for the love of Zeus, who in their right mind would live in Downtown Pittsburgh?

It’s a place to go to work, but once the work’s done, you leave. Been that way for generations.

Comment by Blano
2008-02-20 09:42:11

Apparently the same kind of people who would live in downtown Detroit, given the uptick in condo sales down there. The “why” part continues to escape me.

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Comment by phillygal
2008-02-20 09:51:15

I don’t know, Slim, does donntonn PGH have a “scene”?

I’m putting my money on the “Scene” theory.

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Comment by Arizona Slim
2008-02-20 10:03:57

I don’t ever recall Downtown having a “scene.” IIRC, Pittsburgh’s “scene” areas are in Oakland, Shadyside, and Murray Avenue in Squirrel Hill.

 
Comment by jfp
2008-02-20 10:13:49

Not really. There are areas surrounding downtown that do, but I have yet to actually meet someone who lives or hangs out downtown, and I’ve lived in Pittsburgh most of my life. It’s just a place to go to work for the most part.

There are some pretty fun places to live within a twenty minute bus ride to downtown, and you can live in all those places for less than $200,000. I’m not sure who they’re building these condos for. The population of Pittsburgh was still declining every year, last I checked.

 
Comment by Amy P
2008-02-20 10:14:36

Exactly right. Downtown Pgh is very sterile-feeling.

 
Comment by santacruzsux
2008-02-20 10:53:58

Ahh the golden triangle. You go there to work. Go to the cultural district for a play or a symphony. But you always eventually leave and go home. Those downtown condos are really quite silly.

And now that casino is going up on the North Side. I hope it fails miserably. No good can come from that endeavor.

 
Comment by Faster Pussycat, Sell Sell
2008-02-20 10:58:19

It’s the “New Urbanity” or “New Moronity” or whatever it’s called these days.

Pittsburgh has been in decline since the early 60’s. To use a Stein-ism, there’s no there there.

 
Comment by Kandy Kane-DelMoir
2008-02-20 12:47:13

The southside had the best “scene,” if you ask me. At least in the mid ’90s. And houses on the hillside from which you could see the whole of the triangle. Maaaaan, I loooooooved Pittsburgh. If there’s no there there now, it’s because the there left sometime after 1996. In 1996 the there was there in vats. I don’t mean in downtown, of course, that’s risible: downtown Pgh is like downtown St. Paul.

 
 
Comment by Bye FL
2008-02-20 11:59:58

Walking distance to shopping is the only reason I can find.

But then ill be walking distance to shopping anywhere in Oil City/Franklin

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Comment by Mole Man
2008-02-20 08:08:50

“It turns out that one of the closets had been designed originally as a bathroom. Without an extra bathroom, the upstairs includes no separate area for guests to shower or bathe. So if Facas decides she has to have another bathroom, ‘The seller would take it off the price,’ Hillyer says.”

There used to be a high technology solution to this problem called a chamber pot.

Comment by snake charmer
2008-02-20 09:30:45

I remember looking last year at one rental house here in Tampa, listed as a three-bedroom. Hilariously, the third bedroom, characterized by the house owner as the “master bedroom,” had been the two-car garage. The owner had gotten rid of the garage door, and had painted the concrete slab floor a dark blue.

Another rental owner had jury-rigged a wall right down the middle of a bedroom in an attempt to increase the number of “bedrooms” in the house. There are times when a purported improvement actually makes a house much less desireable.

Comment by NoVa Sideliner
2008-02-20 09:54:25

An ignorant friend of mine with a condo had the real estate value bug a couple of years ago, and he wanted to “renovate” his condo from a 1-bdrm to a 2-bdrm. How?

Just convert the living/dining room into a bedroom! Then take the breakfast nook, knock out the kitchen half wall, expand the nook to make a tiny dining area adjoining what is now a,single-wall kitchen like you see in efficiency apartments. OK, so you have two bedrooms, but you have to eat and entertain in a tiny kitchen!

And with that, he figured he should increase the value of his condo to what the “real” 2-bdrm units cost! Insanity. Fortunately, the condo board’s required approvals stymied him before he could get his fantastic idea off the ground. The arrogant board demanded professional drawings and estimates! :-) Imagine!

Comment by snake charmer
2008-02-20 10:19:14

“And with that, he figured he should increase the value of his condo to what the “real” 2-bdrm units cost!”

Heh. That’s the real reason for the “home improvements” and it has nothing to do with need or aesthetics.

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Comment by Bye FL
2008-02-20 12:03:12

That’s why I go by cost per square foot. A big 1 bedroom can be worth more than a smaller 2 bedroom. I don’t care if there is 10 bedrooms, id pay more for a 3 bedroom that has more square footage.

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Comment by navygator
2008-02-20 10:29:16

When hubby and I were looking in Jax back in ‘99 we saw some horrible “improvements”. My favorite was a typical open plan FL house with a formal dining and formal living room on either side of the front hallway. Formal dining was all decked out and formal living had been turned into a dog pen. Carpet was torn up, linoleum was put down and 2 ft wall was constructed to keep in the 4 little dogs. From the ungodly smell that hit you as soon as you walked in I would be willing to bet those dogs spent 24/7 in that pen. Needless to say we didn’t bother with the rest of the house.

 
 
Comment by Arizona Slim
2008-02-20 09:36:24

People, stop it! You’re making me laugh hard enough to…

…oh, excuse me. Better go use the chamber pot.

Comment by Olympiagal
2008-02-20 10:12:54

HAHaha! Comical!

 
 
Comment by AnnScott
2008-02-20 11:52:33

Hell’s bells! Got to this and you made me waste a perfectly good cup of coffee. Spilled it while laughing!

 
Comment by tresho
Comment by JR
2008-02-20 18:42:00

A friend who has a primitive lake cabin used to have an outhouse with a bucket beneath the seat. (Has since upgraded to composting toilet.) About every week, it was necessary to dig a hole and empty the bucket. It was quite a ritual, involving a long stick for 2-person carrying and another, shorter, stick to lift the handle while the carry stick was carefully threaded through to avoid touching anything. Upon dumping, he always warned us, “Don’t look! Don’t look!” because apparently there was a history of sudden regurgitation. I never looked.

 
 
 
Comment by reuven
2008-02-20 08:15:37

“Fisher points to a healthy mix of ranch homes, cabins, mobile homes and so-called McMansions in the Poconos. ‘It’s certainly not going to take a dive,’ Fisher said. ‘The market here is very different than in California, Nevada or Texas.’”

He’s so right! I’m sitting here in my nice little house in Sunnyvale, CA thinking to myself: “Gee! I should sell this house and buy a trailer in the Poconos…before I’m priced out forever!”

Comment by Tim
2008-02-20 08:32:40

They used to adversise champagne shaped bathtubs for honeymooners filled with cloudy water. I wonder if they still have those.

Comment by Arizona Slim
2008-02-20 09:40:23

Oh, good grief. Someone would have to mention the honeymooner bathtubs. A classic bit of Pennsylvania kitsch.

What’s next on this thread? Distelfinks?

Comment by Tim
2008-02-20 09:52:44

There was this one PA dutch pancake house I used to stop at on my way to Maine. I cant remember the name, but it was great. They loved those birds.

For those that havent seen the tubs, heres a pic.

http://www.curbly.com/DIY-Maven/posts/961-Champagne-Baths-a-la-Dita-Von-Teese

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Comment by Faster Pussycat, Sell Sell
2008-02-20 11:12:09

I hadn’t seen those. Excuse me while I go Clorox my eyeballs!

Incidentally, how do you get up there?

 
Comment by Tim
2008-02-20 11:27:47

I have no personal knowledge, but believe there is a opening on the right at the top of the glass that is accessed by a hidden stairwell. Classy.

 
Comment by Faster Pussycat, Sell Sell
2008-02-20 11:42:51

Hells yeah! Classy as all heck.

 
 
 
 
Comment by Blano
2008-02-20 09:00:45

Nice spin on the trailer option, lol.

 
Comment by Bye FL
2008-02-20 12:04:31

What I would have done was sell the little house and buy a mansion on multiacreage elsewhere for much cheaper and pocket the equity to retire on.

 
 
Comment by mikey
2008-02-20 08:21:40

“Lisa said it’s been incredibly hard dealing with Option One Mortgage Corp. ‘You could never talk to the same person, and then whoever you had next tried to get more out of you,’ Lisa said. She recalled how one service representative told her: ‘I don’t want to hear your hard luck story. I want a check.’”

The above will be the bottom line for MILLIONS of American GF and FB’s for a long, long time to come :)

Comment by Tim
2008-02-20 08:27:08

I agree with the representative 100%. Most companies are in business to make money, not run welfare and social programs. Each debt modification hurts those who didnt get such modification or didnt incur such debt (i.e., just about everyone else).

 
Comment by Timmy Boy
2008-02-20 08:43:23

..

I don’t know about you…. but I wouldn’t accept a personal check from a FB!!

CASH ONLY!!

Comment by Arizona Slim
2008-02-20 09:41:34

And I’d get one of those counterfeit detection pens and test every bill in the stack.

Comment by Faster Pussycat, Sell Sell
2008-02-20 11:17:02

Oooh, nasty, babykins! Why is everyone so nasty to poor Lisa? What did she do to deserve this opprobrium?

Can’t we just get her some tea and cookies and sympathy?

After that, she can live happily ever after in her “grande” doll house with the magical dancing fairies that drop gold coins by waving a wand.

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Comment by edgewaterjohn
2008-02-20 09:21:06

You know, if she was complaining about the poor customer service of something important - like trying to reach your local politician, or a health care provider, or your insurance agent after an accident, or 911 - there would be sympathy.

Truth is, FBs who refinanced deserve a death by a thousand phone calls - with the elevator muzak following them to grave.

Comment by Arizona Slim
2008-02-20 09:43:10

Death by a thousand phone calls. Another HBB classic.

Comment by Faster Pussycat, Sell Sell
2008-02-20 11:21:55

Death by a thousand JT’s, no?

Think about it — they’re all strung up, JT doin’ the ol’ in-out, eyes are a rollin’ up to heaven, prayin’ to sweet baby Jeebus to liberate them from the sweet agony, body vibratin’ in the praise of the JT.

Do you hear a Halleluia? Gimme a Halleluia, sister!

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Comment by GeorgeSalt
2008-02-20 08:25:05

“‘Are we in a buyer’s market? I really don’t know,’ says Hillyer. ‘I kind of feel like it’s a little dip in a long trend that’s been going up.’”

It’s sad, but this is the consensus of most folks I encounter. I have noticed a marked change in psychology. Back in 2005 and 2006, the office breakroom chatter was mostly a game of one-upmanship: “The house across the street just sold for $40,000 more than the last one in my neighborhood! Oh, that’s nothing, the house next door just sold for $50,000 more! I got you both beat! …” Today, I notice that no one wants to talk about real estate. Yet, if you prod, you’ll find most people sound just like the guy in the article: this is temporary dip and in a year or two the market will return to “normal” which they define as double-digit annual increases. It’s amazing how many people believe that 2001-2006 was “normal.” It’s going to take a long time to turn this perception around. I once thought that another “silent spring” in 2008 would do it, but now I don’t think so. What these people don’t understand is that the longer they cling to their delusions, the longer it will take for the market to recover.

Comment by uptick
2008-02-20 08:29:18

“The market here is very different…”

The most persistent delusion of all.

 
Comment by Neil
2008-02-20 09:34:54

Yet, if you prod, you’ll find most people sound just like the guy in the article: this is temporary dip and in a year or two the market will return to “normal” which they define as double-digit annual increases.

All of the sheeple honestly believe that! I was discussing with a very intellegent friend who knows my company is moving people out of state. We’ve lost too many contracts due to having far too many employees in high cost areas. So… the moves are starting to go in mass. All voluntary too (the reponse has been overwhelming).

Yet as soon as his current home sells, he’ll begin looking for a new place to buy at his new geographic location. At least he’s waiting to buy until after selling.

Got Popcorn?
Neil

Comment by implosion
2008-02-20 13:22:43

Neil, is any part of your co, and are some of your coworkers staying behind?

 
 
Comment by Best Wishes
2008-02-20 14:51:42

GeorgeSalt, your soooo right. The truely sad thing about all this is that Ed Hillyer is a licensed Realtor who has been in the real estate business for years which the National Association of Realtors claims is a professional. Wouldn’t you think a professional would know that we’re currently in a down market? He should know better, or maybe he does. Shame on him.

 
 
Comment by wmbz
2008-02-20 08:30:32

“Despite the refinancing in January 2004, the Grandes still had $118,628 of debt on 24 credit cards, according to a bankruptcy filing in October 2005. ‘We probably lost track,’ Lisa said of the number of credit-card checks they used. ‘They just kept sending us checks.’”

$118,628.00 In credit card debt! Damn! I can not imagine that. I don’t care what was going on that is insane.

Comment by Blano
2008-02-20 09:03:11

It’s not her fault….they kept sending checks!! (sarcasm off)

 
Comment by gmork
2008-02-20 09:04:49

$118,628.00 In credit card debt! Damn!

Agreed. I wonder what the monthly nut on interest charges alone is? Must be in the ballbark of two grand, perhaps a bit less, plus whatever minimum principal repayment is required. Another two grand or so?

 
Comment by North GA Dave
2008-02-20 09:23:41

he Grandes still had $118,628 of debt on 24 credit cards, according to a bankruptcy filing in October 2005. ‘We probably lost track,’ Lisa said of the number of credit-card checks they used. ‘They just kept sending us checks.’”

- I must have money, I still have checks left.

 
Comment by ChrisO
2008-02-20 09:28:05

You’d think that the proverbial light bulb in the head would switch on at, oh, about $50k in credit card debt. I mean, the monthly interest payments on even just a few thousand in CC debt are atrocious. Some people are just too stupid to make it through life, I guess.

Comment by Quixotic
2008-02-20 11:45:00

I’m not saying there should be a debtor’s prison, but shouldn’t there just a smidgen of debtor shame? They talk as though they’re children who fell off their bikes.

On the news I heard a woman who was on disability due to vertigo (?) and she said her husband had for years been “either unemployed or underemployed,” so now they couldn’t pay their mortgage. She was complaining of the “endless paperwork” of foreclosure. She didn’t seem the least bit embarrassed. Or grateful that America has a disability/unemployment safety net. (In some countries you starve!)

Where does all this optimism (destined to become resentment when things go south) come from? Me, I practically have flow charts of what we’ll do if various disasters come to pass.

Comment by AnnScott
2008-02-20 12:47:29

“Or grateful that America has a disability/unemployment safety net. (In some countries you starve!)”

Safety net!! Ha haha hahhahaa

If you think people who are disabled in this country are eating well, eating regularly or not bordering on malnutrition - or not out on the street because they can not afford housing - you are beyond clueless. That whole comment smacks of arragont self-satisfied ‘pat me on the back - we are so good to the cripple’ smugness.

Someone who is born disabled or became disabled before they worked enough quarters to qualify for Social Security Disability, there is Social Security Supplemental Income.

SSI is a grand total of $615 a month. Out of that they have to pay for food, housing and everything else. Now they may qualify for a little bit in Food Stamps. Through my charity work, I know how hard it is to get them much in the way of Food Stamps. Try an average of $25-35 IF they are paying 3/4s or more of their income in rent alone. They do qualify for Medicaid.

If the other people in the housheold have an income of more that $656+ a month, Social Security starts deducting an equiavlent amount from the SSD. So in a 2 person household, if the husband makes $1056 and her SSI is $600, she loses $400 in SSI.

If that isn”t deep poverty where they have trouble affording food, I would like to know what is!

Now if someone becomes disabled after having worked enough quarters, they qualify for Social Security Disabiity Income.

The average SSD monthly payment is $918. Read the story in the links about the couple in PA. He was making around $60000 and his SSD is $1147.

If their household is below 150% ($15,450 individual, $21,000 couple), they qualify to have Medicaid pay the Medicare Part B premium and to have Medicaid as supplemental coverage to Medicare.

If the houehold income is OVER 150% FPL, the the person who has SSD has to pay (1) the Medicare B premium of $96 a month, (2) a Medigap policy of around $100-150 a month to cover those 20-50% copays under Medicare and (3) the Medicare D prescritpion premium of around at least $36 a month plus the copays ($10/30 usually) and up to $5800 out-of-pocket in prescription costs. SInce they are disabled,the odds of having a substantial prescription bill are fairly high.

No household that has an income over 150% Federal Poverty Level can get Food Stamps (unless the mdical expenses actually paid reduce the income to 150% FPL or less.)

Housing??? HA HAHA Reagan started it with the cutting back on housing assistance. Now there is 75% less housing assistance than there was 25 years ago. The wait lists go for years - typically 3-8 YEARS.

Oh yeah, people who are disabled should be REAL grateful that they are kicked to the curb and told to be GRATEFUL that they can not afford housing, food and medical care but at least they can afford 2 of the 3 (maybe.)

Tossing out those kind of pittances and expecting people to “be grateful” is morally and ethically revolting. Have some crumbs you beggar and now get down on your knees and thank us. And don’t clutter up our nice neighborhood when you have to have Sec 8 to afford housing and we get to call you welfare trash in all the media when you need Food Stamps to eat and call you leeches for needing Medicaid and call you deadbeats for not being able to pay for car insurance. Yep, they should be real grateful.

And now I need to go take some anti-nausea meds from reading that crack.

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Comment by Seattle Renter
2008-02-20 18:33:23

Nicely put. My mom was disabled due to a stroke, and I can attest to the fact that everything you said sounds exactly right to me.

She worked her whole life as a librarian, saved for retirement, but now has to rely on me for the occasional handout so she can buy food and medicine. Everything she had saved up for retirement got raided by the various agencies you mentioned because by having it, she didn’t qualify for their programs I guess, so she had to cash it out to pay for medicine, medical bills, etc.

Then finally when she was broke and destitute, she qualified for SOME of the programs you mentioned.

Helluva way to treat someone who spent her whole life trying to help better educate the masses.

(Almost) needless to say, after being a lifetime devoted Republican, she is now voting Dem or Independent.

She now realizes that the propaganda about “them gull darned welfare bums” leeching all our hard earned tax dollars is just that - propaganda. Especially in the face of the obscene amounts of money that get wasted in no bid contracts, etc etc etc.

/rant

 
Comment by Mary
2008-02-20 19:20:53

But, like your mother before her illness, why is there so little empathy? Why do people believe that safety nets are only for the lazy? How have the Republicans convinced so many people that “some people” just steal from the government so if we get rid of government those same “some people” can’t steal from it.

And yet, our government is truly now bankrupt, because “some other people” have robbed it so completely and completely intentionally. Those welfare moms could only wish for a “golden parachute” of this magnitude. It is so sad to think that this great country is now over and what we experienced so much of my baby boomer life will not be experienced by my children in their lifetimes.

 
Comment by Bob Culp
2008-02-21 09:25:15

Well i have been disabled for 10 years due to a failed lumbar fusion i get a whooping 834 per month SSDI and this year is the first time i got a cost of living increase less then 3 percent. I tried to get FS and was refused however the folks driving the new caddys and SUVs had no problem getting them. My G/F has paid off her house thank god. So perhaps when ever you think us disabled have it made think again.

 
 
 
 
Comment by AnnScott
2008-02-20 12:25:49

No there are worse instances. Go here and read some of the horror stories. http://www.creditslips.org/creditslips/2008/02/17586227-in-cre.html

What got me with their spending was

(1) the IDEA of having 24 credit cards floating around. Good grief. Why not just invite the loan sharks to move in the house with you?

(2) having been rescued from being behind on their payments by an emergency assistance fund, they blew too much money on Xmas within the next few week

(3) the $84,000 for an adult son’s legal bills. (His kid, not hers) Sorry but there are times when you can’t pick up the bills for the whole family. That sounds like the bill for a criminal felony case in view of the drug rehab. Since the son was over 18, the parents had no legal responsiblity for his legal bills. If he couldn’t afford a lawyer, he would have had one appointed.

Now they have had a LOT of illness - in 2005 daughter (then 20 years old) with an aneurysm; his multiple surgeries and diabetes, and her being off 6 months with surgery and health problems. Did lose his job (and he did try to start a business as getting hired by an employer at his age -probably 50ish - and health problems so no employer would touch him with a 10 ft pole.) I would venture to guess that his diabetes had something to do with not finding a job with health insurance through an employer after his employer closed. Courts are split on whether diabetes is a disability under the ADA. Easy enough to get rid of an employee who is driving up the premiums - just start picking at performance or ‘downsize’ or use the old standby ‘not a good fit with our (new) business model.’

Again they paid the medical bills for an adult child. Better to have let her run up the bills and file bankruptcy (and that is the ‘New” American style of getting critcally necessary healthcare with the costs of insurance out of sight.)

Based on the data given, their income when he was working was probably around $120,000 -130,000. How they could have gotten so far in credit card debt is beyond me. The adult kids needed to sink or swim on their own - particuarly the son with the drug charges.

Now their income is probably around $48,000 from her and $13674 for him. Now he probably does not have any health insurance. Medicare does not kick in until 2 years after he was found to be disabled (ie: date of disability onset.) When it does take effect, he has to pay the $96 for Medicare B, the $36 premium plus huge copays and deductibles for Part D prescription and buy a Medigap plan which is probably about $150 a month. His medical costs have to be pushing $15,000 -30,000 a year and he won’t have any coverage unless she has it through her job. (Not all nurses get health insurance - contract staff is execluded from coverage.)

He went from earning $59,000 or more to having only $1147 a month. If they divorced, he would be homeless. His income would be 133% of Federal Poverty Level for one person. Fastest route to abysmal poverty is to become disabled. THis society tosses a few dollars to the disabled so it can ‘feel good’ about itself but never enough for them to live on without sacrificing housing, medical care or food.

 
Comment by rick
2008-02-20 12:26:14

For the Grandes, I really have sympathy.

These are the incredibly stupid people, not the kind of FB who lies to get a loan and then don’t pay for it. At least they tried to honor their contract.

And the bank loves them too. In this case the bank probably does not lose money - if it can foreclose the house.

But I think there is something missing here. The Grandes must have filed for BK in 2005 and had a resolution with the bank, like taking out a HELLOC to finance the CC debt or something. Now they are behind again.

 
 
Comment by exeter
2008-02-20 08:42:44

“Although Cynthia Moon said 2007 was a good year at Gates & Burns Realty, she expects 2008 will be hard on new buyers. ‘I think a lot of people this year are going to be squeezed out of the market. I don’t think they’re going to be able to get loans,’ Moon said.”

Honestly and logically Cynthia. Just who is getting squeezed right now? Prospective buyers aren’t. Or maybe you just don’t have sense enough to see the facts.

 
Comment by reuven
2008-02-20 08:45:50

“When they refinanced in January 2004 from a $113,906 fixed-rate mortgage into a $220,500 adjustable-rate mortgage to pay off credit-card and other debt, they were told - like millions of others - that they could refinance before the interest rate jumped.”

“Then Anthony’s health fell apart, his plans to start a business foundered, and another refinancing did not come through.”

The reporter gladly reflects Anthony’s victimspeak here. But does anyone here really think that even if his health didn’t fall apart he wouldn’t be able to pay?

I don’t understand how people can say with a straight face that they can “refinance” and make their debt problems go away? What do they think happens when you refinance? That some fairy flies by and waves her magic wand?

No wonder his business failed! If he can’t do the math needed to keep his family under a roof, how can he run a business?

Comment by edgewaterjohn
2008-02-20 09:28:30

Why is it that the people who can’t manage their own finances always seem to insist on starting a business?

Comment by ChrisO
2008-02-20 09:30:58

I think, in such instances, that “starting a business” = “can’t find or keep a job”. Just a hunch.

Comment by Arizona Slim
2008-02-20 09:45:34

The trouble with starting a business is that it’s a lot tougher than those former jobs that these people couldn’t keep. Which means that a lot up them end up adding “failed business venture” to their resumes.

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Comment by exeter
2008-02-20 09:50:54

“I think, in such instances, that “starting a business” = “can’t find or keep a job”. Just a hunch.”

BINGO

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Comment by tuxedo_junction
2008-02-20 10:01:35

Note that his business didn’t founder; his “plans” to start a business foundered. In other words he never started a business.

 
Comment by smiling_in_SD
2008-02-20 10:05:07

“Why is it that the people who can’t manage their own finances always seem to insist on starting a business?”

Because it’s people like them who can’t hold a traditional 9 - 5 type job. So they think they are the entrepreneur who will succeed at their own business….only they’ve never really succeeded at anything before and this is just one more pipe dream

Comment by edgewaterjohn
2008-02-20 11:12:17

Ralph Cramden comes to mind.

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Comment by Wickedheart
2008-02-20 11:20:21

I think the reason these people fail is they don’t get how much work running your own business really is. Successful entrepreneurs work much longer days than 9-5 and more than 40 hours a week.

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Comment by Bye FL
2008-02-20 12:09:14

Not my home internet business. I can put any amount of hours, actually putting more than 20 hours a week won’t get me much more money, diminishing returns.

 
Comment by Kandy Kane-DelMoir
2008-02-20 12:56:34

Is it Amway? That’s just a hunch.

 
 
 
Comment by AnnScott
2008-02-20 12:49:13

Because he is probably pushing 50 with health problems.

Try getting hired when you are near 50.

Hell will freeze over first.

 
 
Comment by salinasron
2008-02-20 11:45:59

“When they refinanced in January 2004 from a $113,906 fixed-rate mortgage into a $220,500 adjustable-rate mortgage to pay off credit-card and other debt, they were told - like millions of others - that they could refinance before the interest rate jumped.”

This was 2004 and yet the BK filing was in 2005 while the boom was still going upwards, and we are getting the feel sorry for me story here in 2008.

Comment by sfbubblebuyer
2008-02-20 13:10:32

They obviously filed BK to avoid paying the bills by selling their ’sure bet’ house and covering everything. If they’d sold, paid their bills, cut up the cards, and rented, they’d be sitting pretty in 2008.

 
 
 
Comment by Roger H
2008-02-20 08:58:36

“The market here is very different than in California, Nevada or Texas”

Please folks - I keep reminding everyone - accodring to our local Realtors, there is no bubble in Texas. Enough of this negative thinking.

 
Comment by MontanaAnna
2008-02-20 08:58:40

“The new loan - with no income verification, according to Anthony - ”

To my ears this sounds like a friend of mine who said yeah he signed a contract with the guy who’s suing him - but it wasn’t notarized!

 
Comment by SDGreg
2008-02-20 09:03:43

“More and more, people from places like California, where housing is considerably more expensive, are finding homes in Venango County with lower prices. ‘We get emails from people who want to buy five or six houses,’ Woodard said. ‘It’s like pocket change to them.’”

Please produce said e-mails. Assuming such e-mails exist, does anyone end up buying 5 or 6 houses in your county? I’m guessing not. Lots of places are cheaper than California. Why should one choose Venango County Pennsylvania over other options?

Comment by ChrisO
2008-02-20 09:29:14

Everybody wants to live there, didn’t you know?

Comment by KenWPA
2008-02-20 10:35:15

“In 2005, Realtors reported record sales of residential properties along the river. One of the priciest areas was Rockmere where homes were selling for $400,000 and $500,000, sometimes more.”

“But now, a lot of riverfront residences are sitting empty and out-of-town owners who are hoping to sell these properties for high prices can’t, Bloom said. ‘I think people just don’t have the extra funds right now,’ she said.”

Those would have had to have been purchased by out of town speculators, because there are very few people in Western PA making enough to afford a $500k house, especially in Venango County.

Looks like no place is safe from this mess.

Comment by Bye FL
2008-02-20 12:15:28

In Oil City, there is maybe one or two homes that cost $500k, both are outside town on like 10 acres. There is a mansion for $649,900 in Franklin that just sits and sits. Several nice 5000 square feet houses in the $250k to $400k range that no one can afford.

The cost per square foot makes no sense for those huge houses, I can buy two or three smaller houses and get the same combined square foot for half the price.

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Comment by HARM
2008-02-20 11:52:12

The California equity locusts have already swarmed and died off en masse. They will not return for another 17 years.

 
Comment by Bye FL
2008-02-20 12:12:27

I can see buying two, maybe three houses to live in but 5 or more?

One house in town, maybe a second one if you get alot of guests and they can sleepover. Then another house on multiacreage just outside town for growing an orchard and enjoying the peaceful country.

I am buying just *one* house in town till prices drop. The homes outside town will drop alot more since most of the value is in the land. I am not paying $200k when it’s worth less than half that.

 
 
Comment by Ron
2008-02-20 09:08:48

“More and more, people from places like California, where housing is considerably more expensive, are finding homes in Venango County with lower prices. ‘We get emails from people who want to buy five or six houses,’ Woodard said. ‘It’s like pocket change to them.’”

The knife catchers will be in for a shock as this deflation cycle takes years and reduces RE prices too levels nobody in the states can imagine.

Comment by Bye FL
2008-02-20 12:20:22

You think those $50k homes will drop much in price? No one I talk to believes so. Prices in 2000 were only a few thousand lower. Most people have no problem affording those houses in the first place and alot of people are moving to states like Pennsylvania, me included. When $50k gets me what $250k is in south FL, it’s a bargain for everyone!

Comment by KenWPA
2008-02-20 15:35:56

I rent a house in a small town in Western PA for $400.00 per month. It has been completely remodeled, has a new very efficient furnace, Washer and Dryer, new carpet and vinyl and other than a bit too close to a busy road a very sweet 2 bedroom, 1 bath detatched house with a nice yard.

I could buy a similar house before being remodeled for 25k in town. These are homes that families can actually afford with two people working minimum wage jobs ($7.50 or so in PA.)

I live in one of the few areas of the country that are cheaper to rent than buy, but due to a serious commitment issue…I just can’t make the decision to buy at this time and in this town.

I already own acreage outside of town at the family farm, so I have a bit of a hedge if things should ever go thru the roof again and I get priced out forever.

 
 
 
Comment by SanDiegoLar
2008-02-20 09:09:10

Test post

 
Comment by Ben Jones
2008-02-20 09:13:18

‘Realtor Sandi Fromm said that she had no choice but to lower prices. In the end, its developer, Citizens for Affordable Housing, took a big hit. The market rate homes sold for $40,000 to $170,000 less than the asking price.’

‘I think if they had come on the market six months sooner we would have been fine, but they didn’t,’ Fromm said.’

Six months earlier and you would have had some Fbs underwater with modest incomes, and that would have been fine? And this is the affordable housing people. Geez, people in Mass are supposed to be pretty bright.

Comment by Tim
2008-02-20 09:22:02

I dont understand why affordable housing needs to be new, or why it needs to be mixed with market rate units. What a total insult for ppl paying market rates to know they could have paid less if they worked a little less, didnt get that graduate degree or developed a drug habit. Even the best intent doesnt lead to good results if you dont understand the consequences of your actions.

Comment by DD
2008-02-20 12:20:57

Generally the best way for a developer to make money with affordable units is to either build new or rehab. That’s where the tax credit money comes in - difference between cost and value from reduced rents (which are usually set as a percentage of median household income). As for mixing market rental units and affordable units; I’d say in a mixed property the number of affordable units is designated by a governmental authority; i.e. you get to build x number of market rate units if you include x number of affordable units.

Nobody forces the market rate people to choose to live amongst the affordable-rate people, so anyone who’s insulted by it has brought it upon themselves. If they don’t like it they should just live somewhere else.

Comment by Tim
2008-02-20 12:54:36

Exactly my point. Such a system is the best way for the developers to make money as opposed to the most efficient way to handle the problem. Why not subsidize them to live in existing housing? With respect to your second point, I know many ppl that have bought in areas in which affordable housing was subsequently built. Why do you think that the existing owners had the right to veto such projects? The fact is that it was shoved down their throats.

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Comment by Tim
2008-02-20 13:03:46

You have to understand that by artificially making housing affordable for some you necessarily make it less affordable for others. I dont want those making the decisions to get to decide who is most deserving. Selective assistance is one of the most brutal and disturbing forms of discrimination.

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Comment by AnnScott
2008-02-20 12:59:29

“What a total insult for ppl paying market rates to know they could have paid less if they worked a little less, didnt get that graduate degree or developed a drug habit”

What do you do? Sit around and pull the wings off flies for fun?

Affordable housing is aimed at the workforce. Retail staff, restaurant employees, low level bank employees, EMTs, firemen, policemen, and all the other people who perform ESSENTIAL jobs (which is more than can be said about a lot of paperpushers with MBAs) but that do not produce the income needed to buy that $300,000 house.

Why do you hate the people who provide all these goods and services to you (at everyday low prices) so much? What gives you the right to dismiss someone as unworthy of having a house because they don’t have as many degrees as I do (all the way through a doctorate)? Who do you think you are? What do you do that is so bloody valuable? Save anyone from a heart attack recently? Maybe stopped a crime and arrested the bad guy? Worked as a home health aid caring for the ill and elderly? Kept that grocery or gas station open during a blizzard working a 15 hour day so that people could get food or fuel?

As far as ‘working less’ goes, I would love to see you hold up as a waiter/waitress around my village of 350 people when we get inundated by 1,500,000 obnoxious tourists with just your attitude of entitlement.

Our county has virtually no apartments. It is either buy or rent a single family home. The median price in the ocunty is over $389,000. Doing affordable housing projects for all those essential workers is an absolute must.

Comment by Tim
2008-02-20 13:21:18

Ann your posts are often filled with rage and prejudice, and you often get lost on an emotional tangent when ppl mention the elderly, the disabled, or certain other of your favorite subgroups of the day, failing to see the irony in that you are in fact probably the most discriminatory and biased posters on this site. I think that all ppl should deserve equal opportunity, not just those you label as deserving. I have nothing to prove to you but am a non politically correct liberal that believes in market forces. If there is an issue with salaries, address salaries. Why do you think certain ppl in certain 40k a year jobs are better than ppl in other 40k a year jobs? If you stop picking some to give assistance, the group as a whole will be better off. Who did I say I hated or dismissed? I dont think you took the time to understand what was being said.

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Comment by AnnScott
2008-02-20 15:50:47

I am not prejudiced

I AM outraged at the arrogance that everything is sweetness and light for the people struggling in the bottom 1/2 of this country.

I AM outraged at the dismissive attitude of people like you who casually class all those who do not make enough to be in the top 20% of the househlds which is the only bracket that can afford the vast majority houses in the bulkof the US or much of anything in this society as lazy, stupid drug-addicts who should be ‘grateful’ (see the other bigoted and judgemental person above.)

It is ignorant comments like yours where you dismiss everyone who needs affordable housing programs as

(1) not working more - implying they are lazy

(2) not getting a Masters - how do you know? Last time I checked the teacher’s who qulaify for the afffordable housing program in this county have at least a BA and usually an MA

(3) have a drug habit - relly how lowcan you go in your insults?

Anyone who has more than a passing qwareness of the econmic situation for those in the bottom 65% of this country who be incredibly outrages at that kind of garbage.

I suggest you reflect on your unmerited bias and go develope some understanding of how most of the US lives.

You can start by spending some night working at the food pantry here. It is open NIGHTS becasue the people who need have jobs. One man who comes there is a single father with 2 kids who has an MA in computer programming. Unfortuantely his employer downsized and not many employers want someone pushing 50 - so he freelances and tries to provide for the children.

This arraogant hatred and dismissiveness of those who are struggling in the US even though they work, even though they have they often have degrees in one thing or another is beyond contempt.

The kind of garbage you and Quixtic (or whatever) are spewing out here is indicative of fear that one day it could be your, disdain for others or sheer ignorance. Anyway you look at it, it is demeaning and flat wrong.

YOUR attitudes are biased, judgemental and hateful.

Someone has to be outraged- obviously neither of the two of you have a CLUE!

 
Comment by Tim
2008-02-20 16:11:00

Again you forgot to read and understand the post. I did not say all ppl in affordable housing are lazy, uneducated or had a drug habit. What I said was that ppl that do not qualify for affordable housing could in fact qualify if they went down one of those paths and as a result ended up with a job paying less money. Im not just making this up, I know from experience. Rather than attack the accuracy of what I said, you simply chose to ignore what I said. You know nothing about me. To make such inaccurate assumptions is disgraceful. I find you to be a bigot to the core and question your ability to reason logically. I’m sure you dont see it, but others have repeatedly told you about this persistant problem you have in attacking without cause or understanding of the issues. I know you think you are a great person. Many, including myself, just dont see it the same way you do.

 
Comment by salinasron
2008-02-20 16:25:18

Ann you have that do-gooder mentality that says you know what’s best for society. If you’d build some responsibility into people around you they’d be better off. Did you ever think some people feel very comfortable at their social-economic level. And pleeease Ann don’t insult me about teachers, firemen, policemen as being at the bottom of the economic ladder here in CA. I know of teachers in Bakersfield making $70K for a 9mo. year, policemen/firemen in SD, Salinas making over $100K, prison guards making over $70K. And guess what Ann, you say you have a Phd, then I’d say poor you because I know that most police, prison guards, firemen have better pensions and income then most Phd’s without having incurred the education expenses. When I was going for my advanced degrees in Chemistry I spent a summer working for a chemical company and had a boss tell me the facts of life in the corporate world: Phd’s are a dime a dozen, we buy them cheap (grants) to develop a process which we then own and make millions off of; don’t get a Phd get an MBA in marketing.

 
 
Comment by Sarah
2008-02-20 13:42:04

Ann you constantly have to be told that your bias and disrespect for others limits the strength of your arguments. Please take such helpful advice into consideration.

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Comment by tresho
2008-02-20 15:49:22

If the workers are that essential, let their employers provide their housing.

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Comment by martin cohen
2008-02-20 16:16:46

And let the government provide the health insurance.

 
 
Comment by Sarah
2008-02-20 16:51:27

Ann - You do realize that none of the things you are “outraged by” actually apply to Tim’s post, but instead apply to your misinterpretation of it don’t you? Do you not see that you are the one that is labeling and classifying groups of people based on personal bias? The fact that you use your discrimination in support of groups you think deserve more than others does not really aid in your cause but makes you look silly.

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Comment by JR
2008-02-20 19:32:58

Tim’s quote: “What a total insult for ppl paying market rates to know they could have paid less if they worked a little less, didnt get that graduate degree or developed a drug habit.” Tim’s intent seems pretty clear to me: “Anyone who can’t afford a $350,000 house is lazy, ignorant, or a drug addict.”

I am more than happy to see schadenfreunde directed at the mortgage brokers, developers, boosters, salespeople, etc. - the professionals who should have known better and who led others into serious error. I understand that actions have consequences. I would be delighted if house prices dropped like a stone.

But some comments on this blog occasionally betray a contempt for those of limited means. Everyone makes foolish mistakes sometimes. If you haven’t taken your turn yet, you will. Beyond foolish mistakes, some people never attain material success for a variety of good and valid reasons.

Take your pick:
“There but for the grace of God go I.”
“F you buddy, I got mine.”

 
Comment by Tim
2008-02-20 19:58:53

Its easy to argue against my words when you rewrite them for me. Next time try to argue with what I actually said. I know its a little more difficult, but at least it would be accurate.

 
 
 
 
Comment by WT Economist
2008-02-20 09:22:11

Citizen’s for affordable housing should look at the bright side. The private sector is about to create a whole bunch of it, hopefully without government subsidy.

The real estate bust of your formative years in Texas was followed by the real estate bust of my formative years in New York. I recall arguing that it was great the GFs kept building office space in NYC. Why? Because we needed to compete for business with the “free” office space we New York taxpayers were handing out in Texas via the RTC. Some companies moved out of here to there to take advantage of that.

High real estate prices are bad for the economy, and low prices are good, provided they are not so low that they discourage ongoing investment and reinvestment in buildings.

Comment by Quixotic
2008-02-20 17:48:00

If I was having these kinds of massive health and financial problems, I don’t think I would conclude that this was a good time to start a business, and I don’t think I would decide that this was the year to have an expensive Christmas.

I’ve been poor! But I lived poor then.

Ann, I’m sure if you contact the reporter who wrote the article, you can find out where to send your donations to the family. It’s very generous of you to want to help.

 
 
Comment by esteban
2008-02-20 09:25:28

How sad that those affordable homes became more affordable.

Comment by Arizona Slim
2008-02-20 09:47:43

Just when I thought it was safe to stop laughing while reading the HBB…

Comment by Neil
2008-02-20 10:25:02

LOL.
Thankfully I put the drink down.
Won’t it be a tragedy when affordable homes are affordable by the median? Ghads!

Got Popcorn?
Neil

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Comment by Bye FL
2008-02-20 12:22:50

Ive said it before that in PBC, FL “affordable” homes cost $164k to $299k. Only 50 were ever built. You now can buy a short sale for around $200k making the “affordable” house program a moot point for developers.

 
 
 
 
 
Comment by Bad Chile
2008-02-20 09:30:01

$5,000,000 built 11 homes in Newton. That is $454k per home. Seven were to be “affordable”. The other four would cover the costs.

Say seven homes at $250k per - that is $1.75m. The remaining four would have to go for $812.5k per to break even. Imagine spending $812k only to find out that of your 10 neighbors, seven were there on “assistance” programs.

No wonder Mass is heading down quick.

Comment by esteban
2008-02-20 09:48:14

Being a lifelong Mass resident, I see firsthand this culture of exclusion. We’ll put “Save Darfur” signs on our front lawns but fight legislation that makes our towns more affordable.

Comment by Tim
2008-02-20 10:02:50

Why let housing become affordable for everyone when you can hand pick those that match your criteria of deserving?

Comment by Arizona Slim
2008-02-20 10:06:16

The concept of “affordable housing” is getting people tied up in knots. Here’s a Tucson example:

http://www.tucsoncitizen.com/ss/local/77415.php

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Comment by Tim
2008-02-20 10:17:47

For the most parts its a boondoggle so that Developer’s get tax credits and/or tax emempt financing, and politicans and ignorant concerned citizens can feel good about themselves. I believe our cities would be a much better places if we built luxury and allowed the outdated supply to become the affordable housing. Building new cht when we already have to much cht is dumb is cht.

 
Comment by Tim
2008-02-20 10:36:44

By luxury I really just mean architecturally significant, quality buildings, not necessarily excessive or lavish. I hate seeing new crap constructed whether it be in the form of new affordable housing or cheap, synthetic stucco McMansions. Build quality and let market forces take care of the rest. There has been such a focus on poor quaility and lack of architectural detail that it scares me how ugly our metro areas will look in 20 years.

 
Comment by Arizona Slim
2008-02-20 10:47:01

I might add that the Dunbar Spring neighborhood (that’s featured in the above Tucson Citizen story) is one of the most rapidly gentrifying areas in the city. Hence, the concern about affordable housing seems to be stretching things.

 
 
Comment by HARM
2008-02-20 11:56:14

Why let housing become affordable for everyone when you can hand pick those that match your criteria of deserving?

No kidding. Here in Bay Area, we force developers to build a % of units as “BMR” (Below Market Rate). http://www.sfgov.org/site/moh_page.asp?id=17815

Way better than eliminating punitive fees, red tape, NIMBY and political pandering.

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Comment by Craven Moorehead
2008-02-20 10:46:21

Any chance you live in or near Marblehead? The “Save Darfur” signs are everywhere, and disgust me.

 
Comment by tresho
2008-02-20 15:52:17

Maybe they’ll save me a blonde for $5.

 
 
Comment by salinasron
2008-02-20 11:58:00

“Say seven homes at $250k per - that is $1.75m. The remaining four would have to go for $812.5k per to break even. Imagine spending $812k only to find out that of your 10 neighbors, seven were there on “assistance” programs.”

Amen Bro! Welcome to Salinas and the CA south bay area. Wait until property values drop even further and all will be multifamily section 8 housing. That is why I will never buy in this area. The down side of Do-good-er mentality.

 
 
Comment by Olympiagal
2008-02-20 09:59:36

“Lisa recalled a carpenter on their roof during construction stamping a broom and saying so many people went bankrupt expanding their homes. ‘I knew it then. It’s like he cursed us.’”

Jeeze, Lisa, put the blame where it REALLY belongs! On the broom. From your clear analysis it’s obvious that this was one of them evil, nefarious, moron-cursing brooms. The carpenter was just the innocent tool.
I just wish people would learn where to assign responsibility.

Comment by Olympiagal
2008-02-20 10:09:34

Ben, good job on finding such an astoundingly illustrative article.
It’s full of gems:

‘The whole affair has shattered Anthony’s sense of himself. “I was always hustling. I always worked. Now I can’t do anything. I feel like a jerk,” he said.’

I, too, feel like you’re a jerk, Anthony. In fact, I’m pretty sure that the bagel I just ate was smarter than you are, as well as far less jerky.

 
 
Comment by Richard Mason
2008-02-20 10:05:07

Lisa recalled a carpenter on their roof during construction stamping a broom and saying so many people went bankrupt expanding their homes. ‘I knew it then. It’s like he cursed us.’

That carpenter should be hanged for witchcraft.

Comment by Olympiagal
2008-02-20 10:17:47

Him AND his broom. And his whiskbroom, if he has one, just to be sure.

 
Comment by Ernest
2008-02-20 10:25:44

Are we too advanced now for burning at the stake?

Comment by mikey
2008-02-20 10:33:03

Are we too advanced now for burning at the stake?

Dunno… but I’ve got some matches if you’ll gather some wood :)

Comment by Olympiagal
2008-02-20 11:02:41

Don’t forget the marshmellows, boys. I’ll bring those.

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Comment by mikey
2008-02-20 11:12:09

k..b..b..but NO strange mushrooms ..Please :)

 
Comment by Faster Pussycat, Sell Sell
2008-02-20 11:26:11

I like strange mushrooms. Let’s just put mikey on the rotisserie plan too.

 
 
 
 
 
Comment by arroyogrande
2008-02-20 10:23:02

“The Grandes borrowed more than $100,000 - much of it on credit cards - to double its size four years ago…It is hard for the Grandes to grasp how they got to their current state from where they were in early 2003.”

WHAT??? Have them read the article, or just my little quote above…then maybe they will understand? Or how about this:

“That’s when Anthony lost his job…He figured it was a good chance to expand the house because he wanted “a place for the kids to come home to.”

HINT: When you lose your job, you find a new one BEFORE you start doubling the size of your house.

I’m sorry that the guy has to suffer through diabetes, but to quote his wife:

“”To be quite honest, we were probably foolish also”

Comment by arroyogrande
2008-02-20 10:25:00

*AHEM*

“Pennsylvania’s Homeowners Emergency Mortgage Assistance Program helped them get caught up in August 2006. But after spending too much for Christmas in 2006, they fell behind again early last year.”

(arroyogrande slaps hand on forehead and mutters a Homer Simpsonesque “Doh!”)

 
Comment by WT Economist
2008-02-20 11:10:14

Here is the point. Once again, the MSM is holding up as a beneficiary, or possible beneficiary, of the bailout someone not all that sympathetic.

At least this one is balanced — health problems and job loss are somewhat sympathetic. But there have ALWAYS been foreclosures due to health problems and job loss.

What is “different this time” is that they borrowed and spent so much, and property values are dropping so the mortgage note holder is hosed, not just the borrower.

Now imagine if this couple, after having saving and rented all their lives, had put down a downpayment and bought at an inflated price in 2005, because they thought it was their last chance to own a house, and had otherwise lived within their means before bad luck and the sneaky exploding mortgage nailed them. That would be sympathetic.

But with all these articles, I’m still waiting for someone like that.

 
 
Comment by SD_FotBotD
2008-02-20 10:41:57

“She said the average size of last year’s sold homes was a little smaller than the previous year. ‘The big McMansions — they’re sitting for awhile,’ Chaladoff said.”

Having a Used-House Seller use the phrase “McMansions” struck me. I thought that was a derisive term we used for those oversized, cookie-cutter houses. I didn’t know that they used it too! (And that they’re now willing to be quoted using it! I thought they never met a house they didn’t like?)

 
Comment by Patch Tuesday
2008-02-20 10:46:12

““Although Cynthia Moon said 2007 was a good year at Gates & Burns Realty, she expects 2008 will be hard on new buyers. ‘I think a lot of people this year are going to be squeezed out of the market. I don’t think they’re going to be able to get loans,’ Moon said.”

Fixed:

““Although Cynthia Moon said 2007 was a good year at Gates & Burns Realty, she expects 2008 will suck and be especially hard on Sellers. ‘I think a lot of uninformed buyers that have been watching NAR commercials this year are going to be squeezed out of the market. Luckily for them, I don’t think they’re going to be able to get loans,’ Moon said.”

 
Comment by Fuzzy Bear
2008-02-20 11:55:26

“2007 was a sluggish year in Venango County overall, according to Rebecca Bloom of Wilson Real Estate. She blames the slump on the national news about foreclosures. ‘People are afraid to buy houses because of the media,’ she said.”

The old blame game again. Ms Bloom, realtors were a major part of the problem and the realtors have lost all credibility in the views of the public! If you want blame, blame the NAR!

 
Comment by Bye FL
2008-02-20 12:40:07

Hey Leigh,

“Er…don’t buy a house ’cause the blog said so’, yet you’re going to buy a cheap one, and wait for pennies on the dollar for a bigger, better one?”

Thats the smart thing to do. Where you live, you can rent cheaper than buying and house prices will drop $100k. Where im moving to, it’s twice as cheap to buy and house prices will drop maybe $10k(less than the loss on rent anyway)

 
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