Local Market Observations!
What do you see in your housing market this weekend? Builder problems? “Thursday was move-in day for Rob Poidomani and Gretchen Reiners, the first residents of south Charlotte’s new Ardrey Crest subdivision. The big move followed an unwelcome surprise: They’d learned days earlier their builder was leaving the upscale project after starting fewer than 10 percent of the homes. D.R. Horton pulled out.”
“‘I’m sure a lot of people are perturbed,’ said Reiners, while carrying stuff into her new home. ‘But when you move into a neighborhood, you take the risks. Someone else will build here, and they will build nice homes. It just won’t be D.R. Horton.’”
“A proposed sale of the Bahama Island resort property in North Myrtle Beach has fallen through, leaving investors who lost millions of dollars in deposits on the failed condominium project with dwindling alternatives to recoup their losses.”
“‘We are asking that the property be frozen and not allowed to be disposed of or sold without prior court approval,’ said lawyer Jarrod Ownbey, who has filed lawsuits on behalf of 43 Bahama Island buyers who lost deposits. ‘We don’t feel that the bank is taking the depositors into consideration, and those depositors won’t be protected unless we intervene in the foreclosure action.’”
“A Bridgeport City Council member contends a proposed tax break for developer Phillip Kuchma’s half-finished downtown condo project is illegal, but city officials say the deal is on firm legal footing.”
“‘I don’t want a huge, half-finished project in downtown that will ruin development in the rest of the city,’ said City Council President Thomas McCarthy.”
Or foreclosures? “On weekends, Coppell real estate agent Tess Langevin loads up a bus full of potential homebuyers and heads out to look at foreclosed properties. Ms. Langevin has plenty of homes to show.”
“Based on last year’s foreclosures, the eastern and southern sectors of Dallas County have seen the largest numbers of lender sales. But there were also big pockets of foreclosures in fast-growing northern suburbs including McKinney, Keller and Frisco, according to Foreclosure Listing Service.”
“‘Most of the foreclosures I am seeing are in newer tract home neighborhoods,’ said longtime Dallas real estate appraiser Jack Towers. ‘And if they can’t refinance, they are stuck. We are seeing a lot of people just walk away from their homes.’”
“Mr. Towers said the scope of the home crisis has him worried. ‘I’ve been though a couple of these things, and I don’t like this one at all,’ he said.”
Or overbuilding? “About 18 months ago, the market for condominiums was enjoying a solid five- to six-year run. Today, however, many areas of the nation are scattered with ‘busted’ condos, some of them under construction or just completed, others that are condominium conversions and partially sold.”
“‘The formerly most-booming ‘boom areas’—Florida, Arizona, Nevada, and California—have the largest inventory of busted condos, but this situation exists in almost all parts of the country,’ Jules Marling, partner of Real Estate Research Corp, tells MHN.”
“‘Builders have overbuilt in some parts of the country, like Chicago, where there has been a drop in rents,’ Marling tells MHN. ‘It is now significantly cheaper to rent than to buy.’”
A reader posted this new house for sale in Arizona. Check out the price per square foot!
‘ Desert Breeze Series From: $211,990 4079 Square Feet
4 Bedrooms
2 Bathrooms
1 Half Bathroom(s)
3 Car Garage Attached’
I’m not keen on it’s looks, but $51 a square foot is more like it - and, for a new home.
I guess the price of cardboard and scotch tape is dropping.
Jaw hits floor…
I’m just as impressed by the ~$80/ft^2 prices of the small homes (Acacia series-Sagebrush in the link). Hey, the Acacia series-Aster is under $100k! But… These homes are also ~40 miles from the major job centers (as far as I can tell).
Got Popcorn?
Neil
It’s a shocking POS, and it’s more than $51/sq ft. Anytime you see “from” in the ad, ignore the price. These HBs are worse than hoteliers and car dealers.
Imagine living in this oversized shack in the middle of the summer. Your kids upstairs are pounding on the paper-thin floors; they’re complaining about it being too hot - as you deal with $400/month A/C bills; the cheaply-made windows are starting to yellow in the heat. 10 years down the road the whole thing is falling apart - roof tiles are cracking, the trim is all sagging, the doors don’t close right, the upstairs bathrooms smell because the venting is inadequate, etc.
This house makes great sense - as a day-care center for children accustomed to the Sahara Desert or west-central India.
“From $$xyz” is the slimey way of saying ‘well, if you want flooring other than plywood, that will add $$; and if you want paint on the walls or trim, that will be another $$$; and oh yeah, countertops add another $$$…..”
Man alive … that’s ugly. And big. And sterile-looking.
“Man alive…that’s ugly. And big. And sterile-looking.”
It’s everything Willy Loman could possibly desire.
Since it’s a rendering as opposed to an actual photo, could they be trying this on for size to raise some quick cash to prop up some of their underwater projects?
I live in Phoenix and don’t even know where Coolidge is. It must be an “oasis” amongst itself. Or I forgot and the dead cactus. The way prices are dropping in Maricopa county why move to Coolidge. Whereve it may be.
Yes, this is dry, dusty, “hot”, and almost exactly 40 miles from the I-10/202 freeway interchange. The area was probably agricultural in nature before they started developing it. The daily commute from this area to Phoenix is costly, but to Casa Grande its only about 10 miles.
RE Jobs: Fact is Casa Grande has some industry (ag based, printing, etc) and I’ve talked to some businesses that are moving onto the Indian Reservation on the south side of Phoenix, where the Indians are making it much easier to build a new industrial building.
I think these houses look like a POS, but for some people from SoCal or other states its a way to “live the American dream”.
Probably have to be built in one their subdivisions. They probably hammer you on the lot price…
That’s my guess anyways..
“We bought a 22-passenger bus and are full,” she said. “We may have to rent another bus to follow behind us.”
The knife catchers are blinded by the light!
Mine Eyes Have Seen the Glory … and it’s a McCrapBox!
“revved up like a douche another rotor in the night”…lmao
Even though the lyrics say “deuce”, I always heard it as “douche” because that’s exactly how he says it. Probably the most acid-indouched lyrics ever created outside of Sgt. Peppers. The calliope crashed to the ground. Now, WTF is that all about?
LMAO!!!!! I have no idea!!! (im dying laughing here)
In Bruce Springsteen’s original version he pronounces the word as “deuce”. But Manfred Mann’s is definitely the better version overall, IMHO.
Hilarious!
One short bus wasn’t enough. They need TWO short buses. LOL
LOL.
And once again I am reminded why not to read the HBB with liquids. Sigh.
Ben probably gets a steady flow of donations from manufacturers of monitors, keyboards and keyboard wipes.
“We bought a 22-passenger bus and are full,” she said. “We may have to rent another bus to follow behind us.”
Now wait a minute–I thought renting was just like throwing money away!
My Wells Fargo account manager informed me that the minimum down payment for a Wells Fargo mortgage is 15% down, no wiggle room. Can anybody on the bus come up with 15% down?
Thats like $30,000 on a $200,000. If Wells is leading the pack, what bank is left that will finance these foreclosures with low downs.
RE: Thats like $30,000 on a $200,000.
So who’s buyin’ anything @ $200k?
Starter digs here on the northshore of Mazzland are @ $400k.
That’s $60k for a downpayment plus another $5/10k in closing costs.
Yup-lots’ of Gen XYZ’ers runnin’ around with $70k cash in the bank.
lol.
For ‘non-conforming’ their minimum down payment is a proper 25% now. But Wells Fargo is the last US AAA rated bank for a reason; they’ll survive (they sold off most of the risk of earlier loans).
A full doc high down payment market is supposed to save home prices? Snicker… the trend is our friend. (Then nervously looks over shoulder at employment opportunities… I’m doing backup plans.)
Got Popcorn?
Neil
I think you’re going to see that Well’s got taken to the cleaners by the fraudsters on their HELOC’s…
There’s no shortage of stuff here in the DC area where the dirtbags found houses for sale under the appraisal, got the first loan for the sales price, and a Well’s credit line up to the appraisal, which they immediately drained and never made a payment…
Orwell’s Fargo is no different from any other bank in our country about to go BK.
Bank runs will be undiscriminating, and take down every financial institution, like so many tall poppies…
With the nation as a whole having a negative savings rate for a few years now, I would expect there are very few people that truly have 30k in the bank.
Truth be told, I would be willing to bet, that the majority of Americans don’t even have more than two months worth of expenses in the bank.
A large portion of the population probably has less than a month’s expenses in the bank. I don’t think the country as a whole has been as vulnerable financially, as we are going into this recession. If it is a severe recession, it will feel like the Great Depression to millions of people.
“Truth be told, I would be willing to bet, that the majority of Americans don’t even have more than two months worth of expenses in the bank.”
I used to work with this old guy whose definition of “middle class” was that a family/person was middle class if they had enought cash or liquid assets to fund 6 months of expenses.
When you read about folks tappin’ in to their 401Ks at this early juncture, makes you wonder how many true middle class people there are in this country…
I remember once many years ago my supervisor talking to one of his peers at work, and they both agreed they felt uncomfortable without 6 month’s gross pay (for them, a year’s for me at the time) in a demand bank account.
At the time I just felt total disbelief. Now I’m the age they were then, and I feel the same way they did. And yes, I do have that much on call.
When you read about folks tappin’ in to their 401Ks at this early juncture, makes you wonder how many true middle class people there are in this country…
At least they have 401Ks. I know way too many people who drive beamers but who have a balance of zero in their 401Ks, and most of them have 150K+ household incomes (and spend it all, plus more).
Yes, but remember we don’t know the extent to which people put money into 401Ks as the government doesn’t include it as “savings” in official statistics.
For example, I know people who were putting nearly ALL of their disposable income (in one case about 24% of annual take home pay) into retirement accounts, made good money for Georgia, quit their jobs and THEN used IRA money to put downpayments on properties.
(Remember that those making good wages in Georgia, for example, can sock away a considerably greater proportion of their annual income in retirement accounts than can someone living in California, for example. Federal IRA contribution laws do not take into account the disparity of wages across our 50 states).
These folks now are working once again and came out way ahead of the game by using their IRA funds while not generating income.
“My Wells Fargo account manager informed me that the minimum down payment for a Wells Fargo mortgage is 15% down, no wiggle room. Can anybody on the bus come up with 15% down?”
WF is also demanding 25% down in declining markets. Wachovia is demanding 20%+. This may be the tipping point we’ve been waiting for.
Hefty down payments (heck, even 10% isn’t easy, that was my first down payment) used to be a requirement, as was debt to income ratios…..that’s what kept home prices in line with local incomes.
If we really are returning to traditional lending standards, we should see some serious, and I mean serious, declines in home prices this year.
Lisa, that’s exactly right!
Lending standards push home prices into the 3x median area. We have got numerous banks who are bleeding badly - but at the end of the day, it is the bank’s prime raison de etre to actually lend money.
Therefore, the historical 3x income with 20% down will again become the norm.
I can’t see income rising to meet prices, which means prices (driven by the banks) will lower to meet income. Plus, this bubble was so huge, I would expect a beyond-the-mean reversal situation for several months (or even years) at the bottom.
On Orlando TV a couple of days ago, a bank - I think it was Wachovia - was still offering a Pay-Option mortgage with three or four payment choices. Didn’t watch it long enough to see if one of those was neg-am, but one choice definitely was I/O. Don’t recall them describing the down payment requirement.
“If we really are returning to traditional lending standards, we should see some serious, and I mean serious, declines in home prices this year.”
Not in downtown St. Petersburg (Florida). Highrise condos are still going up, and more are planned, and most units start at 600-700k for the smallest on the lowest floors. I was there today, and was amazed at all the building, with many places advertising “only one (or two or three) left.” I had lunch at the Vinoy, and it was packed; no visible evidence of any economic problems. St. Pete used to be a haven for people on fixed incomes, but downtown is rapidly becoming a haven for the very wealthy, which will be its ultimate downfall. There nothing charming or artistic or memorable about Lexan highrises, or specialty shops catering to the habitually spoiled and conforming.
What reasonable very wealthy person would opt to live in St. Pete? No offense, but what the hell is there? I have the feeling you’re right about that downfall thing. I think most of Florida is for the very briefly wealthy.
From Thousand Oaks, Ca: Plenty of For Sale signs. Many have been up for 6 to 12 months. Others went from For Sale to For Rent and are now back to For Sale. Thousand Oaks has a large “old community”. People who bought in the early to mid-1960’s (for about $35,000). They are now in their 70’s and 80’s. So, many are not interested in moving as they near the end of their lives. Many don’t care if the prices are ridiculous because they are not FB’s so they are staying put. Thus, nothing is really selling but, conversely, prices are not falling through the floor either. A $700,000 property at the peak, is now around $600,000. Give or take $25,000. Rents are in the $2,000 range so there is a long stagnant period ahead. Prices will certainly fall but it’s like watching grass grow.
Different story. I owned 2 properties which I sold (too early!) One was a condo in West Hollywood, Ca. I bought it for $195,000 in the 1980’s and sold it in 2004 for $325,000. It then went to $725,000. According to Zillow (which isn’t very reliable I know) the price is still hovering around $700,000. There is a reason for this. My condo building slowly began to turn “all gay”. When I bought, it was basically a family building. Most occupants had one or two kids with a few “straight” couples. I should add I bought it as a rental. By 1995, it was 80% occupied by gay singles and “couples”. I was told it is now 100% “gay”. How does that make a difference? Well, this is Los Angeles so: #1. Many gays work in the entertainment industry and have high paying jobs. #2. They (mostly) do not get married and have children. #3. If they are a “couple”, they have two high incomes. $400,000 per. annum between them is not unusual.
In fact, I sold to a gay “couple” who are still in the condo. It’s in areas like this where prices will remain reasonably stable. There is a constant flow of gays entering areas like West Hollywood, looking for a place to live, many working in high paying jobs. In other words, there is a LOT of money in these communities and the money isn’t spent on saving for little Snottly and his sister’s education, extra medical insurance, summer camp and only one spouse working, etc.
End result: As the older generation die off in places like Thousand Oaks, ca. where I am now, their heirs might decide to sell and lower the prices to get rid of the property quickly, thus lowering the prices of other properties in the area.
However, in places like West Hollywood, ca. there will probably be a drop in prices but not that much. Interestingly, I checked the foreclosures in the 90048 area (where the condo is). There are very, very, few. In the Thousand Oaks area there are quite a few but still not that many compared to places like Florida, etc.
“Thousand Oaks ”
Any fallout from layoffs (Amgen, Countrywide)?
Yes. Some fallout but not much thus far. I know someone who is still working at CountryWide but he’s looking for another job as he feels the axe will fall eventually. That said, there are plenty of jobs around if you have the right qualifications. Of course, there are masses of low paid jobs which is mis-leading. The reason there are masses of low wage jobs ($10 and below) is because workers cannot afford to live in the area or anywhere near the area. For at least 30 to 40 miles around, the cheapest apartment is probably close to $1,000 a month. If you are making under $2,000 a month and you have to pay taxes, drive a car at $3.50 a gallon, repairs, etc, you’re not left with much at the end of the month. However, if you are qualified (mostly tech stuff) you can see $60,000 + jobs in plenty of places. That said, things are changing…..
“if you are qualified (mostly tech stuff) you can see $60,000 + jobs in plenty of places. That said, things are changing….. ”
wow and homes only cost 10x that at 600K.
Better to have sold too early than too late ! You had a nice profit be thankful. A small gain is better than a big loss.
I agree about TO, prices are very sticky and very low inventory in decent areas. People are still buying at $325/sq ft which is very discouraging. The buyer/seller stalemate persists.
I’m renting a 1,500 sq ft 3+2 apartment for less than $2,000 per month and the apartment manager is offering a $500 bounty for any current resident that brings them a new tenant.
I guess I’ll have to wait it out for the time being.
I live smack dab in the middle of 90048. We’ve had a few forclosures and prices have been dropping.
$725k condo is not going to hold. Trust me.
I never thought about the gay angle before, and though I’m sure there’s some truth to this, IMHO it’s gotta be the same as the “rich foreigners”, “retiring baby-boomers”, “rich Californians”, fill in the blank of who’s-gonna-save-our-ass here. Anecdotal evidence that becomes statistics.
There is no difference between “gay couples” and DINK’s from an economic perspective, and I have met more than my share of financially-deluded “gay couples”.
An FB is an FB, no matter what label you pin on them. End result is gonna be the same.
Exactly. Although the innuendos are a little easier.
“I live smack dab in the middle of 90048.”
Hey me too! It’s a little island of denial here ain’t it? Like watching paint dry on growing grass. ‘Cuz, ya know… “It’s different here” ® ;-P
You got TO described perfectly. My almost 80 year old parents live in Lynn Ranch and don’t give a damn about home prices. They bought in 1973 and have prop 13. Maybe I can sell their home to a bunch of rich gays when their time comes to move out? The house is only 3000 sq ft plus on 1/2 arce and for two old folks its much too big, they are always freting about how much work it is but won’t move because of … PROP 13. I know they can move their prop 13 to another house in the county of equal or lessor value and I tell them this over and over…. but would they they have room for all their stuff ?
“You got TO described perfectly.”
Don’t forget the weather there, awesome!
but won’t move because of … PROP 13.
————————
Naturally, you know your parents better than I, but another possibility (applied to my parents & in-laws) is that they want to stay in **their home**. It’s not so much about Prop 13, but they are in a familiar place that they can afford. All their memories, friends, familiar stores & restaurants, etc. are there.
That being said, we (younger folk) shouldn’t fret. As their generation passes away, these homes will go to their heirs to live in or sell or rent out. Whatever happens, these homes will be available to younger people at a better prices, sometime in the future.
Sounds like your parents have a very lovely home.
Or here in NYC because of under $500 rent controlled apartment they have lived for 40 years.
Well you wanted a stable area, and you got it. In the last building we lived in, on the upper east side, with 17 apartments, only 2 turnovers in 7 years, and we were one of them!
——-but won’t move because of … PROP 13
Yeah mike, I had one of those w. hollywood condos. It was owned by vic morrow till he died on the set.
It was all gay in the 80’s and they hated having a female person at homeowner meetings. I did an REO and moved to the valley.
So basically, the REIC has to figure out a way to convert more people to gaydeism.
“No question housing is in a slump here, as it is nationwide. Permits to build new houses in the region have sunk to at least 10-year lows. But the market isn’t as bad as most. Jobs are still growing, people still coming, home prices haven’t tanked. So builders continue hunting a sweet spot, even as some slash prices, dump lots and abandon the market.”
So much for Charlotte being untouchable. That was B.S. any way. Charlotte is wholly dependent upon the banking industry and Yankees relocating with bags of money from the homes they sold. Oops. It’s time for Plan B. There was a lot of overbuilding in South Charlotte. I should know. I owned 2 miles from this Ardrey Crest development. South Charlotte is not hell by any means but the powers that be would love to turn it into suburban hell. They have sold their souls to the developers. Pedestrian unfriendly South Charlotte is in for a wakeup call.
It’s inconceivable to me that anyone would relocate to anywhere within 50 miles of Charlotte for any reason except work. No river, no good college, no beach (Lake Norman?), no mountains, lots of traffic.
Got a Christmas card from an old (way old) trading buddy who now works for Wachovia in Charlotte. Said the money market/bond business (non-Treasuries) is the worst he’s EVER seen it, and he goes back to the late 70s.
You could easily see 10,000 banking industry layoffs in Charlotte over the next few years. I think this city will surprise a lot of people on the downside.
I moved there for employment reasons and moved out for the reasons you have stated. Plus traffic on 485 was becoming awful. Uptown was a joke to me as well.
I agree that Charlotte is grim, but Davidson is a good college (not an alumnus either).
I used to like Charlotte, but to me it has lost it’s luster. Traffic seems to get exponentially worse everytime I visit.
The city seems to be a facade. Nothing seems real to me there anymore. You go out and everybody is all dolled up like it is Oscar night or something. The city used to always seem to have a bit of an inferiority complex, and it seems to have trickled down the street level to me. People trying to Out-Church, Out Dress, Out SUV and out spend one an other in order to “Fit In.”
I might just spend time around the wrong people, but to me the city is very, very Stepford Wives. Heaven forbid you have more than two beers in an hour, or you will get some nasty glares from one of the many Stepford Wives, who are afraid that you might ruin their reputation amongst the other “In People.”
I used to like how clean the city was, but now it just seems to add to the artificial feeling that I get from the city. The place just seems to have no Soul, but fighting to do whatever it took to give the impression of all is well.
But since the city is still growing by leaps and bounds, so this view of the city is not shared by many people that is obvious.
Sounds like Norfolk, VA … except there is a river. Lots of growth but no soul.
How far were you from the Pink Church?
I lived in Charlotte for 10 years (1993-2003) but I have no real idea where Ardrey Crest is? Off Park Road and 51 somewhere? Or more toward Matthews?
While I agree with others that Charlotte lacks a Soul, I can name a hundred worse places. Ever live in Atlanta? That town REALLY sucks! A sprawling, vaporous, wannabe Los Angeles, full of toothless debutantes from below the gnat line.
My sister just managed to sell her 100 year old house in the Rose Garden Area of San Jose for full price (1 Mil) and low ball a Mc Mansion in Gilroy in a Gated community , seller already under water, for less than $800K. Hers sold in less than a week, the one in Gilroy was on market for over 100 days without offer.
I still don’t understand the attraction to Gilroy…how long of a drive is it to San Jose or SF, and how bad is the traffic? It’s a farming community, for gosh sakes, what is there to do there? Or has it become a suburb since I was last in the area (2000)?
“Gated Community” says its all and Morgan Hill is still way too expensive. I hope my sister buys a prius or two years from now they’ll be moving again.
It’s the garlic.
Don’t knock it, the garlic icecream at the Garlic Festival is great! (And I’m not kidding).
Garlic festival!
They widened 101 in 2003, adding a carpool lane and flyover to 85, making the commute in a lot better.
“‘Builders have overbuilt in some parts of the country, like Chicago, where there has been a drop in rents,’ Marling tells MHN. ‘It is now significantly cheaper to rent than to buy.’”
I guess “now” is whenever Marling and his buddies at Real Estate Research Corp. decide to wake up.
Builders have overbuilt in some parts of the country, like Chicago …
Surprise!
Chicago developers overbuilt. Now comes the wearing of sackcloth and ashes, the weeping and gnashing of teeth.
And yeah, there are a lot of erstwhile condo properties jumping into the rental market now as developers and owners try to get some net revenue in (while refusing to “just give it away”).
You’re kidding! You mean there’s no real market demand for those 15 or so spanking-new condo towers within a sand grain’s throw of the river?
Or those dozen of so developments off Roosevelt and Jackson?
Or those developments at Irving Park and California?
Or those developments near Bryn Mawr and Sheridan?
Or those THOUSANDS of multi-story gut rehabs everywhere in the city?
Gee…maybe if those phony palm trees from Oak Street beach and stuck them in front of Trump’s new trophy, we could pretend we were Miami.
For example:
http://chicago.craigslist.org/chc/apa/590523036.html
(This is one of the condo buildings near me that I’ve complained about in the past. Guess an FB is trying to rent while waiting for another sucker to buy.)
My estimation is that sucker is overpriced by at least $400/month, if not more.
And in a nearby condo development I love to hate, another FB asks way too much for a rental:
http://chicago.craigslist.org/chc/apa/591407058.html
(This one’s on Diversey across from the Rock ‘N’ Bowl. Man, I hate that development.)
I hated that one with a vengeance too.
What’s there to do out there? Go to the mall? Or hook up with the trannies that are peddling their “wares”?
Urban renewal, my @ss!
Bad choice of phrase around trannies.
Isn’t Lathrop Homes (CHA) right across the river from there? I think the one photo showing the skyline has one of its buildings in view.
Yup, Lathrop is right across the river.
On the east side of Clybourn just north of Diversey they put up some new 2/3 story condos a few years back - their front window view is Lathrop straight across the street. They weren’t cheap, I always wondered how the buyers justified that purchase.
Hmmm… how did this guy learn that I’m paying just $725 mo. for a 2 bed 2 bath?
I’ve news for this dolt: it’s been cheaper to rent than to buy in Chicago for at least the past 5-7 years. Anyone who buys into the Chicago marketplace is either:
(1) an idiot.
(2) well-heeled to the extent that losing money on real estate is of trifling concern at most.
I need some advice… My husband and I are moving the the Bay area at the end of the month and were only able to find a rental with a potential FB. The guy bought the place in ‘04 for $560k and put about $150k in it. It’s a gorgeous place and the rent isn’t bad (maybe we could buy it when it goes belly-up?). How do we best protect ourselves regarding our deposit, etc.? We have been having such a hard time finding a decent rental house and don’t have time to do an extensive search. What would happen to us if he lost the house (how much time would we have to move, etc.)? This is all new to us and we don’t want to get screwed. Thanks for all your help!! You guys are GREAT!!
As far as protecting yourself from a foreclosure action, you may be able to file a “Request For Notice of Default” with the county recorder. You may need a real estate attorney’s help with this since they have easier access to the information on the property and it is easier for them to file things with the recorders office.
All this does is inform you if the lender files a notice of default with the recorders office regarding the property you are renting. The recorder then notifies you via the mail. It doesn’t protect you per se in a financial sense, but it does let you know the foreclosure process has started and you can start quizzing the landlord about the situation.
Perhaps you could request that you security deposit be held in escrow but that may be too much of a pain in the butt.
That happened to someone I know here in MN…in their situation this is how it played out. 1) He was served papers at his door that the property was being auctioned off in a sale ~1 month from the date the papers were served. 2) Panic..place calls to tenant rights groups, etc. Turns out landlord has 6 months to get his act together (should he choose to), spoke to landlord, ok to stay, reduced rent (heck-he wasn’t paying it to the bank after all) 3) Property was put up for sale. At this point, if he was still in a lease the new buyer would have needed to honor it (was on month-to-month at this point)–not sure if the bank would have had the same obligations. 4) Property sold, he was forced to move out but his initial down payment was something that the new buyer had to bring to the closing.
OK, maybe a little weak but this is my interpretation of the happenings. Clearly, I know nothing about the law and this was in MN.
(1) Get a lease in writing
(2) In the lease, specify that your deposit will be placed in an interest-earning escrow account. Any bank will set one up.
This is entirely reasonable and proper. It is a DEPOSIT - not a prepayment of rent. In fact, many states require that the deposit be placed in an interest-bearing account.
Spell out in the lease when and if the deposit is to be returned or forfeited. (Springing for the $100 or so to have a lawyer write up such lease provisions for you - not the landlord -would be well worth the money.)
Also any other monies such as the last month’s rent in addition to a deposit should be put in the escrow.
(3) Call the county office that keeps the land records. (Called the county clerk or clerk of deeds in most places.) That office will have the mortgage on file. COPY IT AND READ IT. (If you don’t understand the mortgage doc, pay the $100 for a lawyer to explain it to you.) That will let you see if the rent will cover the mortgage payments. Also check with the county and see what the taxes are. Again, you can determine if the rent will pay the taxes and mortgage.
Read the lease to see if there is a reset and, if so, when and to how much.
Have the clerk check and see if there is a Notice of Default filed.(First step in foreclosure.)
If you can get the landlord’s Soc Sec number off the loan documents and mortgage filed with the clerk, pay the $40-80 to run a credit check on the landlord. There should be 2 documents filed on the mortgage - the promissary note and the mortgage itself. Usually the Soc Sec is on the note. You can go online and find all kinds of places that will run a credit /lawsuit judgement or dig up such information.
(4) Try to negotiate a penalty clause with the landlord. That means if your lease is terminated early because of something he does (like not pay the mortgage), that you get damages. Ideally, an amount that is enough to cover the cost of you having to move abruptly, would be put into the same escrow as the your deposit by him.
Even if he doesn’t put up a ‘performance deposit’, ideally the lease should have a penatly clause if he doesn’t perform and breached the lease. Maybe something like 1-2 months rent. It is called liquidated damages. Again, go see a lawyer. This might not stop the landlord from breaching but it would let you get some money back from him by going after his wages or other property.
(5) Since you would know the name of the lender from the mortgage documents, ideally the lease should let you write the rent check to the landlord AND to the mortgage holder (assuming that the rent is not more than the mortgage.) That way the only way the check could be cashed is if he signed and it and handed it to the mortgage lender.
Some parts of the Bay Area (depending upon the town) have some good protections for renters if the landlord ends up in foreclosure. Some places it can be up to 30-60 days after the foreclosure auction before you would be required to move. There was an article in the San Francisco Chronicle about this in the past month. Do a search of the SFC and see if you can find it.
Also lenders often will pay you to move out after a foreclosure. CAVEAT: DO NOT hand the lender’s agent the keys until they hand you a check. DO NOT move and then hope to get the money promised. Make them show up at the door with the check and then you hand them the keys and put the last things in the car and leave.
Thanks, Ann! I’m going to be in a similar situation soon, and just learned a heck of a lot from you. If you are an attorney in CA, I might just have to hire you.
Thanks Ann!!! This is of GREAT help!!! I knew I could count on you guys!
Thanks again!!
I’m obviously not going to try and enter it from where I am in Australia, but it seems to me there’s a legal/paralegal market niche here.
tenancyprotection dot com doesn’t seem to be in use.
Just sayin’.
Ann, Awesome reply, will be putting that one in the archives. Lip
Hi. It’s been a long time since I posted. Been busy with work. Missed my daily fix from Ben and the rest of the gang. According to realtor.com there are 273 listings here on Capitol Hill, Wash, DC - zip 20003. Wonder if the agents are not posting for sale signs to try and hide inventory ? I walk around quite a bit and just don’t see that many signs.
I’d like to see a pie graph of inventory that goes off market right now. The components would be: FB’s trying to rent out and wait for the market to “come back,” foreclosures, non-FB’s that were just hoping to cash out anyway, and then there would be a small sliver of actual sales.
I’ve been monitoring a McMansion here in northern San Diego Co. The realtor just relisted it, hah! It’s been on the market for about 6 months. Now zillow says 12 days. He is so busted. It started at 1 M, now it’s 899K, zillow says its worth 859k. We’ll see. Bought in 2003 for 600K.
Location: Dutchess County, NY
Noticed 3 new forsale signs up today just between here and MIL’s (1.1 miles), even with all the snow. There are now 8 for sale signs on a road with roughly 40 houses.
Retarded local excavator broke ground on 2 new shacks down the road. WTF? I’ve actually talked to this guy about the condition of housing and he’s no dope. I’m not sure why he’s building two more.
It’s springtime soon. If he doesn’t work he spends more money, gets bored, and his wife complains.
If he goes to work, he stays in touch with what’s important in his life, stays in better physical and mental condition, keeps up appearances, and keeps his credit revolving.
If he breaks even on the houses, he comes out ahead.
Austin home sales down
Sales of existing Central Texas homes continued to decline in January, but the median price rose.. Homes sales dropped 10 percent in January from a year earlier to 1,321, down for the seventh month in a row, according to latest data provided by the Austin Board of Realtors. Pending sales also plunged 31 percent from the same month a year ago, an indicator that February sales also will be down. However, the median price of a single-family home rose about 7 percent from last January to $187,000.
This link should be in every HBB’ers HB folder.
http://tinyurl.com/2qtxs5
Burlingame, CA - It’s different there. I’ve watched this little town… and this is the first drop I’ve seen…
1110 Bayswater Ave APT 206 BurlingameCA 94010
Sale History
01/29/2008: $588,000
07/06/2006: $650,000
07/29/1997: $229,500
Thusday night I was talking to the publisher of a local (Bozeman Mt.) business newspaper. The coversation started on how the county attorney had screwed up the prosecution in the MSU football players murder case. It soon turned to the real estate market.
I asked him what they are going to do about the housing market crash. He told me, “we don’t want to make any enemies.” Meaning they are going publish only puff pieces.
I have written many times about how worthless the Montana news media is. This one few time I have heard the truth from someone in the news business.
Is it like this in other areas?
“I asked him what they are going to do about the housing market crash. He told me, “we don’t want to make any enemies.” Meaning they are going publish only puff pieces.”
Meaning they are going to protect their advertising income.
Mortgage fraud prosecuted
Wow, they actually prosecuted the broker and the fraudster for forging income amounts and buying four houses in Montana! Only bad news is that the guy gets to keep the houses.
Check this guy out out, http://app.mt.gov/cgi-bin/conweb/conwebLookup.cgi?docid=A03470
Four convictions of felony bad check, and two felony theft convictions!! And he was a mortgage broker!!!
I am sure he has a whole bunch of misdemeanor convictions also.
In Montana, you have work really hard at crime to get stuck with ether a felony theft or bad check conviction. This guy looks like he worked overtime.
#@%#!!! I missed a digit on the address. Try http://app.mt.gov/cgi-bin/conweb/conwebLookup.cgi?docid=A034720
I found more details about this motgage scam. This from the U.S. Attorney’s Office for Montana.
http://www.usdoj.gov/usao/mt/pressreleases/20071005170218.html
It looks like NINJA loans gone bad. Scott Hilgers counterfeited W-2s for Todd Rice to get four loans from Triwest Mortgage.
Scott Hilger was hired by Triwest while he was on probation for felony bad checks and felony theft. Hilger even spent time in Deer Lodge for bad checks, which means he is a real screw-up.
And somebody hired him as a motgage broker!!! It’s like giving the keys to the bank to Jessie James.
According to our Alderman a proposed 45 story high rise to be built next door is now “100% dead”. A few months ago it was reported that the developer could not secure financing. Our neighborhood had been fighting it as our streets are absolutely gridlocked as it is and the infrastructure cannot handle another high rise.
At the start of today’s walk we saw a realtor get all pissy. He had stopped to quickly refill the sale flyers in a plastic holder while his customers waited. Since no one has been taking flyers lately he had to jam the new ones into the holder as the buyers watched, and was none too happy about it.
According to our Alderman a proposed 45 story high rise to be built next door is now “100% dead.”
Congratulations! Nobody needs a 45 story highrise on their block. I can’t imagine what kind of street parking nightmares that would bring.
Reporting from Colorado:
One of the major home builders in the area has been putting on these “seminars” the last 6 months or so (one about every 2-3 months) where they invite you down to talk about the home building process and feed you and give prizes.
We like to go to them just for fun and because there is free food. So far, it has always been PF Chang’s. I’ll eat free Chang’s any day!
Anyways, the first time we went there were about 50 people, Chang’s and big screen TV giveaways. The second time we went, there was about 35 people, Chang’s and TV giveaways.
Today, no Chang’s, just some store bought scones and muffins, the prize was a $50 Visa gift card. And the best part was… my husband and I were LITERALLY the only two people who showed up. And we showed up late! It was a little eerie to be honest. They only did 30 minutes of the 1.5 hour presentation, and of course, we won the gift card.
But just a sign of how the times sure have changed!!
Beautiful. What would set the scene correctly would be Lawrence Yun as bus boy at Changs.
exeter- that took the cake! I almost fell out of my chair…
I know a guy who owns a trucking business (he owns a couple of rigs, and drives one of them himself). His specialty was hauling construction materials to jobs sites. I ran into him yesterday and asked him if he was affected by the slowdown. He replied that he hasn’t had a gig since late last year, and that efforts to find other non-construction, short haul jobs have been fruitless.
Perhaps one of the folks in the Boston area can shed some light on the status of this condo development?
http://www.nouvelleatnatick.com/
I think I tried to mention it last weekend, but the software ate my post. Not that I would touch the place with a ten-foot pole, just that I drive by it each week when I go to visit my parents, so I’m kind of curious.
About all I’ve seen on the project lately is a 2.5% broker “incentive,” whatever that is, described here:
http://tinyurl.com/36llos
The Novelle at Natick is offering a broker incentive program. If you visit the new development and write down my name, and then buy a place, I get paid 2.5%!
Desperate seller interested in trading $1m+ home…What does that even mean??? (I thought paying $$$ for a home was trade — you trade the opportunity cost of monies for the home you buy…)
5283 CAMINITO PROVIDENCIA Rancho Santa Fe, 92067 $1,150,000 - $1,150,000
Beds: 3 | Baths: 3 | Sq. Ft.: 2,380 | Lot Size: N/A
Year Built: 1985 | Listing Date: 03/26/07
Description: Seller will consider trade!! Lowest priced home in 92067!!!
P.S. I am looking forward to single family homes in 92067 (Rancho Santa Fe) listing below $1m before this bubble is fully deflated…
D.R. pulls a D.B. Cooper
“Thursday was move-in day for Rob Poidomani and Gretchen Reiners, the first residents of south Charlotte’s new Ardrey Crest subdivision. The big move followed an unwelcome surprise: They’d learned days earlier their builder was leaving the upscale project after starting fewer than 10 percent of the homes. D.R. Horton pulled out.”
“It’s a buyer’s market, and house hunters are scouring the nation for properties by the busload, literally, even in Prince William County.”
Yup…. millions are ’scouring’ and snapping them up everywhere. You all better get out there and get yours before they’re all gone. Hurry!
fawkin morons.