A Half Price Sale In Florida
The Sun Sentinel reports from Florida. “For perhaps the first time in its history, Broward County lost population — 13,154 more people left than arrived during the past year, according to U.S. census estimates released today. In the past two years, 55,808 more residents left the county than moved in from other states. ‘It’s very clear that growth has slowed down substantially,’ said Stan Smith, director of the Bureau of Economic and Business Research at the University of Florida. ‘It’s partly due to the economic slowdown and the slowdown in job creation and the housing problems Florida has been facing.’”
“Anneke Reinhardt, of Hollywood, is among those trying to flee. Her three-bedroom home with a pool in the Lakes area has been on the market since last year, and the divorced senior citizen is shopping for a home in Knoxville, Tenn.”
“‘It is getting too expensive for me to live here and I don’t have a nest egg,’ said Reinhardt, who has lived in Broward for 30 years and works at a lighting factory. ‘I feel I’m crazy staying here when the cost of living is so much less somewhere else.’”
“‘This a real alarm,’ said William Frey, a demographer with a Washington public policy think tank. ‘In a way Broward is a bellwether for the rest of the country, and if Broward is losing people, which in itself is so surprising, that shows how Florida, especially, is hard hit by this housing crunch.’”
“Nine other Florida counties lost population. Pinellas County near Tampa dropped by 5,456 and Monroe County lost 1,174. Others that dropped by a few hundred to 1,500 people were Bay, Charlotte, Escambia, Franklin, Glades, Jefferson and Okaloosa counties.”
“Semore Borker says it’s pretty obvious why population growth has stagnated. ‘I have found that Florida and Palm Beach and Martin counties are no longer a retiree’s paradise because of the expenses,’ said Borker, who has his home west of Boynton Beach for sale and is hoping to move to South Carolina once he sells.”
“Borker, a transplant from New Jersey, said his yearly expenses would be cut nearly in half when he makes the move. He would still live in a community with a pool, tennis courts and all of the amenities he enjoys here — for half the price.”
“‘I’m 80 years old, I have no pension and only a little bit of investments,’ he said. ‘I could downsize but that’s not going to cut it for me.’”
“A total of 11,186 people left Palm Beach County from 2005 to 2007 for other places in the U.S., the report shows. If it weren’t for births and foreign migration, the county’s population growth would likely be in the negative.”
The Boca Raton News. “‘If you don’t have to sell your house, don’t,’ a real estate expert told an audience of consumers and Realtors® in Boca Raton this past weekend.”
“‘We have a large overhang of inventory,’ said John Tuccillo of John Tuccillo and Associates, ‘and overbuilding of new homes.’”
“He also faulted Freddie Mac and Fannie Mae – programs designed to put people into homes. ‘They went a little overboard – by pushing people [from smaller homes] into larger homes.’”
“Would-be homebuyers were wooed with zero down payment loans, interest-only loans and something he called an ‘option ARM’ where buyers could ‘pay what they want. We’ll just tag the rest onto the principal.’ ‘Easy credit,’ he said, ‘got a lot of people in trouble.’”
“‘What’s keeping South Florida in the real estate doldrums? Foreclosures, unsold new homes and the slow economy,’ said Tuccillo.”
“He even offered up the ‘R’ word, saying people feel they are in a recession. Tuccillo predicted it will be ‘relatively mild and relatively short. The only way we could screw it up is to attempt to avoid it.’”
“Tuccillo isn’t keen on the $160 billion ‘Economic Stimulus Package,’ saying it will stall economic recovery and feed inflation. ‘There are three things people will do with the checks: save them, pay debt or go out and buy things and increase the number of jobs – in China!’”
“He said he would rather see the United States invest the $160 billion ‘in a program to repair and replace roads and tunnels. There would be more jobs.’ Tuccillo criticized the proposal as something that was ‘put together by a bunch of people who don’t have a clue.’”
“The hat trick that will pull South Florida from the dumper, he said, is ‘population growth, falling home prices and a better economy.’”
“The first person to put a down payment on a house was Cindy Lee Dickson of Fort Myers. When she woke up Wednesday morning, she had no idea she was going to buy. Then she saw the prices at Coral Lakes: single-family homes at $133,000 and town houses at $86,000.”
“‘We had thought about it and said no,’ Dickson said. ‘But I think the price I saw today convinced me to buy. I think it’s a wonderful investment.’”
The St Petersburg Times. “Nohl Crest Homes, the Tampa Bay area semicustom home builder founded in 1985, is close to going out of business. Sales are only a fifth of what they were two years ago, and the Oldsmar-based builder has laid off 90 percent of its employees.”
“With banks pressing it to repay loans on some of its 100 building lots, the company likely won’t survive the year, Nohl Crest co-founder and president Kenneth Emery said Wednesday.”
“‘Will we be here a year from today? I don’t think so. That’s not going to happen,’ Emery said.”
“‘We can’t sell homes for $500,000, $600,000 and $700,000,’ Emery said. ‘People just don’t qualify for those sorts of homes anymore.’”
“Nohl Crest is the third locally active builder to declare bankruptcy or signal its anticipated closing. Levitt & Sons filed for Chapter 11 in November. Tousa filed in January. Nohl Crest isn’t publicly traded like the others.”
“‘They are a private company, so they don’t have the deep pockets like a national builder does,’ Tampa Bay area housing consultant Marvin Rose said. ‘When they lose money, it comes out of the owners’ pockets.’”
The Bradenton Herald. “There is quality product out there selling for under $100 a square foot, said May Aston, sales associate with Re/Max Alliance Group and immediate past president of the Manatee Association of Realtors.”
“‘It was $200 a square foot at the height,’ Aston said.”
“‘We’re kind of having a half price sale,’ said Patrick McGuire of Coldwell Banker in Lakewood Ranch. McGuire recently worked on a sale where a home that would have sold for $1.2 million during the height of the market sold for $600,000.”
“‘The upper-end homes have really fallen down,’ McGuire said.”
“‘Some are getting good enough deals that they are fixing them up and putting them back on the market,’ Aston said. Others are renting the properties or just holding onto them until market conditions improve.”
“‘They know the market is going to change again, we just don’t know when,’ Aston said.”
“Due to the large number of short sales and foreclosures, Aston and other agents have turned a large portion of their business to focusing on such sales but have noticed an increase in more traditional sales as well.”
“‘People are buying now because even if it’s not the bottom of the market they are realizing they might not be able to afford it if they wait,’ McGuire said.”
“The Sun Sentinel reports from Florida. “For perhaps the first time in its history, Broward County lost population — 13,154 more people left than arrived during the past year, according to U.S. census estimates released today.”
Records probably don’t exist - but I guarantee that Broward lost residents in 1927, and probably subsequent years.
no kidding! although my grandfather and great-uncle stayed on…
Gotta love it - more people leave than arrive and that is called slower “growth.”
“Your future is in Florida, the fair white goddess of states.”
” ‘I have found that Florida and Palm Beach and Martin counties are no longer a retiree’s paradise because of the expenses,’ said Borker, who has his home west of Boynton Beach for sale and is hoping to move to South Carolina once he sells.”
Arrgggh!
(Just kidding.)
“(Just kidding.)”
Shouldn’t be kidding Bill! The people seeking the cheap living and opportunity will cause the same cycle there.
We here in NC don’t want them either. Maybe we should start pushing North Dakota as a retirees’ paradise!
“Maybe we should start pushing North Dakota as a retirees’ paradise!”
If we’re going to damn them to the cold, I think Michigan needs the residents more. Just read that Wayne, Macomb, and Oakland Counties all lost residents. I know you can buy houses in Metro Detroit for $45 per square foot. Maybe the slogan can be “retire to Michigan, it’s dark, it’s cold, it’s gloomy, but it’s cheap!”
Was at boone for some skiing and you are right.I wouldn’t want anyone to ruin my paradise twice a year visit up there..great area..great people..
They shouldn’t come to Greenville County, SC if they want to cut expenses - this has gone from a quiet, lovely, interesting, super-low cost of living area to a high-cost, gridlocked, sprawly AnyTown, USA mess in the 10 years we have lived here.
You guys, quick, do something! Act now! Get on the city/county commission or into state government hurry quick ***now***, before the snowbirds invade. Be a wrench in the development works, make the yankee horde move in to whatever shanties already exist and don’t build any more. It’s too late for Florida, but maybe you can save the Carolinas.
Maybe you can trade Lauren Caitlin for one of em??
Bill
Are you the pot calling the kettle black?
No. That’s why I added, “Just kidding.”
The entire state of SC has fewer people than metro Atlanta. Although I can’t speak about the rest of SC, the upstate still has a lot of stereotypical mountain folk (rent the movie “Deliverance”), but in-migration of mostly Yankee retirees to the lakes, and lots of outsiders to the blossoming auto industry has diluted the native population. I even heard a young couple speaking Chinese to each other in a grocery store in Easley (near Greenville).
I grew up in FL and went to grad school in SC. My wifes family is from a small town in upstate and I own a little land there. Your so called “mountain folks– see the movie Deliverance” is a load of BS. Greenville is a fairly internation city with Fuji, Michelin and BMW engineers there is Japaneese, French and German influnce. Columbia is an awesome towm.
There is however too much religion in SC for my taste.
Bill you are an A$$. People like you have diminished the charm of SC. Is your indictment of your neighbors a form of projection?
Unfortunately..there are these kind of people Space..many still think Atlanta is full of rednecks and pick up trucks..until I take them to lunch at the great Asian supermarket…
Spacecoast, have you ever been to the Pickens flea market? Some of the long-time residents of this part of SC are, well, unique.
But they are a diminishing part of the population. The area IS becoming a bit more cosmopolitan, as my story of the Chinese couple was supposed to illustrate. And as industry continues to arrive, the word is going to get out, and there will be somewhat of a boom.
But I believe everyone is entitled to his or her “piece of heaven,” however he or she defines it. That’s why I said “just kidding” to my original post.
I went to undergrad at UFla Grad school at NYU and SouthCarolina and spent my summer you working dairy farms in the pocono mountains in PA. I can tell you with certainty that all areas have there own unique personalities. Who the hell made you judge and jury of social norm?
Yes I have been to many small flea markets and the locals are usually incredibly friendly and helpful regardless of appearance. I am sure that your neighbors would like to know that you generalize them as homosexual rapist killers with bad grammer and horrible dentition. Why hold your generalizations to SC and the south?? For you aren’t all italians mafia, Irish Drunks, Jews cheap and dishonist, asian bad drivers, mexicans lazy , blacks criminals….
So as I said, you are an A$$ for making generalization about people you dont know. Yeah, and I bet you thought Fargo was real too.
And some people wonder why the southeners don’t welcome new people in their towns.
I’ve been living “up” here in WNC for 8 years now, and I can tell you the “”DIFFERENCE”" between the >>”"LOCALS”"
said Borker, who has his home west of Boynton Beach for sale and is hoping to move to South Carolina once he sells.”
Damn right… Don’t come here, we don’t want you stinking up the place. Besides we fly the Rebel Flag, carry big guns, have a poor education system, eat boiled peanuts and pork rinds, have fewer teeth, date ours cousins, keep our best furniture on the front porch…etc. Wait, that may be why they are coming!
Don’t forget this part:
If you don’t have a junk vehicle in your yard, the state delivers one to you.
http://www.theonion.com/content/node/28559
Pulled this one from the archives. Seemed approriate.
Our State bumper sticker reads… NORTH - 1 SOUTH - 0… HALFTIME!
Well I’m getting up there, still single and lookin’ for Billy Bob. I’ll be right there……………
The South will Rise Again…in the form of a mushroom cloud.
“Nohl Crest is the third locally active builder to declare bankruptcy or signal its anticipated closing. Levitt & Sons filed for Chapter 11 in November. Tousa filed in January. Nohl Crest isn’t publicly traded like the others.”
“‘They are a private company, so they don’t have the deep pockets like a national builder does,’ Tampa Bay area housing consultant Marvin Rose said. ‘When they lose money, it comes out of the owners’ pockets.’”
“With banks pressing it to repay loans on some of its 100 building lots, the company likely won’t survive the year, Nohl Crest co-founder and president Kenneth Emery said Wednesday.”
______________________________________________________________
I wonder which “banks” they owe money to?
Many smaller banks are highly suspect, be careful whom you are banking with…
“‘People are buying now because even if it’s not the bottom of the market they are realizing they might not be able to afford it if they wait,’ McGuire said.”
What does that even mean? They don’t want to wait until next year, when prices are down even more and they have a bigger downpayment?
It’s call illogical Realtard-speak. These morons have built their own idea of how markets work. But it only works in their empty skulls.
What does that even mean?
I think it means that there is an underlying cause that is trying to keep prices up, i.e., the local associations of realtors and the NAR who seem focused on fooling the public with their advertisments. If you look at the comments in the sptimes.com, blogs, (un) real estate, you can read the realtors who reply denying that prices will continue to drop. Some even think that the jobs in Tampa will support the most current prices.
With that said, a friend of mine who relocated his family to the area for a job three months ago is leaving due to the high costs of housing. That is at the most current level of home prices as of today. I think the Tampa Bay area is in for a big surprise as more and more people are lokking to relocate out of the area and out of Florida to reduce their costs. Younger folks wh are college educated are also looking to relocate out of state due to lack of jobs in the area. A friend of mine told me his two boys who graduated from college have already moved due to the high cost of living.
It’s nice to see that people don’t think weather is the only important factor when choosing a place to live.
I grew up bouncing back and forth between Orange County and San Diego…but the quality of life has changed so much that I wouldn’t move back to SoCal for anything. Now I live in Anchorage Alaska and am MUCH happier.
Loved in AK for 16 yrs - 8 in Kodiak and 8 in Anchor town, but left in 90. I think we had the best of AK. As much as I loved it then, I just don’t want to do winters anymore much - not so much the cold, but the dark thing.
Did love in AK, too, but meant lived in AK.
Fuzzy Bear:
Houses are traditionally meant for people with DOWN PAYMENTS. You keep yaking about affordability, yet there are plenty of 3/2s for sale in the Tampa area under $150K.
If you can’t afford a $150K house, you shouldn’t be buying a house.
$150k MEANS ABOUT $50K SALARY $1k WEEK= $25HR….
Ralph: Are there that many new $25 hr jobs being created in Tampa today?
===================================
If you can’t afford a $150K house, you shouldn’t be buying a house.
DJ - that is what I mention periodically to my wife. We have been “boiled” - gotten so accustomed to high prices and then even-higher prices, that now just high prices, relative to income, seem reasonable. They’re not, but the only way the public will recognize that is when they see that price replaced by a much lower one for a comparable house.
Chip:
That’s why the new mantra in the great Mogambo style is:
200 THOUSAND DOLLARS IS A LOT OF FREAKIN MONEY FOR A HOUSE!
http://www.dailyreckoning.com/Writers/MogamboGuru.html
To anycdj:
You’re wrong, wrong, wrong. Bankrate.com calculator says 2 wager earners @ $8/hour each means $2,400/month. With 20 percent down on a $150,000 house, affordable house value is $120,000 — assuming no other debt.
$120K will put you in a codo anyway. So the notion that you need $25/hour to own a house is nonsense. I was making $17 an hour when I bought my first house for $129,000. How? It’s called a DOWN PAYMENT. It’s called RESTRAINT ON CREDIT CARDS. It’s called MAKING SACRIFICES TO OWN A HOUSE SO YOU DON’T HAVE TO RENT FOR THE REST OF YOUR LIFE — UNLESS YOU WANT TO.
But an average hourly household wage of about $18/hour should cover a modest house.
So the notion that you need $25/hour to own a house is nonsense. I was making $17 an hour when I bought my first house for $129,000. How? It’s called a DOWN PAYMENT. It’s called RESTRAINT ON CREDIT CARDS. It’s called MAKING SACRIFICES TO OWN A HOUSE SO YOU DON’T HAVE TO RENT FOR THE REST OF YOUR LIFE — UNLESS YOU WANT TO.
Based on what you said, you are in a group of less than 20% in the USA who understands personal finance. I doubt in todays market that you would get a loan due to the instability of many hourly jobs such as manufacturing.
Your mention of an hourly houshold wage of about $18 and hour should cover a modest house only proves your theory of the $8 an hour 2 wage earner which equates to $16 an hour.
Now take the percentage of these types of wage earners in the Tampa Bay area with no debt and your theory falls apart. Additionally, you forgot in your math to include taxes, insurance and home maintenance costs which would make the 2 wage earner unqualified for the $120,000 loan based on the current lending standards that are now in place.
The combined yearly income in your case is $33,280. The loan you would be seeking is nearly 4 times their income and would place them in a high failure rate category. A need for a new car or expenses for an unexpected medical emergency would put this couple in a financial bind.
Ralph:
Your an idiot who does not know economics and does not have the backing of data to support your positions.
Ben:
Block this idiot Ralph!
Ralph:
I am not looking for a house, I own my property free and clear. Your the idiot who does not understand the economics of the housing market. You are also a realtor/investor/flipper who helped create this mess and is now stuck with property that you are upside down on.
Enough said Ralph!
What does that even mean?
I think what they are referring to is that ppl that cant afford anything more than a laughable down payment or that don’t qualify under normal historical lending standards should jump in now even though the prices may drop further because if banks continue to tighten their lending criteria the bankers might realize these ppl should not in fact be buying. Sounds like great advice doesnt it?
“If you don’t have to sell your house, don’t,’ a real estate expert told an audience of consumers and Realtors® in Boca Raton this past weekend.”
For realtors to say that now is fine. But they didn’t do enough to tell people to dump their house two years ago, when they could have done it for more than it was worth.
One thing I did right. A couple of young women on my block, who used to babysit my kids in their teens, wanted to move. They had inherited the house when their parents died young — cigarettes, lung cancer, heart attack — and had been living on their own with guidance from an older brother since the oldest was 16.
I told them to dump the house immediately two years ago, and don’t buy anything in LA where they were going. They are the only ones who followed my advice on this end. Hopefully they followed it on that end to.
““If you don’t have to sell your house, don’t..”
This is meant to address the problem that Realtors and their industry have with excess inventory — but it could be terrible advice for individual homeowners. Prices are falling: when will real prices ever be this high again? If individuals CAN “dump the house” NOW, might that not be their best interest? Individuals have no obligation to act in the best interest of the RE industry.
I’ve learned that whatever advice a Realtor gives, do the opposite.
“‘We had thought about it and said no,’ Dickson said. ‘But I think the price I saw today convinced me to buy. I think it’s a wonderful investment.’”
If this comment is any indication of general sentiment, we have a long way to the bottom folks.
Think about this person. She does and almost impulse buy, but doesn’t even think that her purchase just put all the existing neighbors underwater. Plus the original builder still has somewhere around 700 lots? And that’s an ‘investment.?
Somebody here said the market needs knife-catchers, and we have them.
“…Plus the original builder still has somewhere around 700 lots? And that’s an ‘investment.?”
Ben, there’s a community in Central Florida called Indian Lake Estates. It’s like a ghost town that started in the 50’s and 60’s and never fully developed. No matter what the prices finally end up, this could be the next Indian Lake Estates.
I think folks in Florida (other than the ones here on the HBB) will be shocked, shocked!, at how many “ghost communities” there are going to be. Empty developments with half-finished sections, boarded up houses, and run-down common areas. And only 20% of the houses occupied.
Florida sounds more like Mexico, all the time…
ghost communities . . . that housed the average service workers for the gripy entitled rich seniors that run & infest Florida. You know, the people like police officers, teachers, gardeners, pool repair, and even yer waiters an busboys.
just listen for all the skyrocketing complaints coming soon from everyone with 2 cents to rub together about how you ” cant find decent help anymore”. that statistic about more people leaving FL than arriving is the come-to-jesus moment, however, most people could care less with their ” let ‘em eat cake” attitude. as long as their pension funded brokerage acct stays positive & the gal at the hair salon are around then all is well.
” someone ” will always just step-in to do the menial work. and by god they should be grateful for the work, is their attitude. I hope FL, CA, AZ, and any other retirement driven enclaves shrivel up & die in their miserly misery. I hope years from now salvage metal teams sorting thru the manufactured homes will discover mummies in their reclining beds stuck on level 6 with a dead tv tuned to Home Shopping Channel, franklin mint elvis plates covering the walls besides those freaky marie osmond dolls, a pile of collecton notices in the living room included with margin call letters from BK goldman sachs over photos of the grandkids pleas to send tuition money since daddy had to fly.
party on garth
At least they speak the language. [pick one]
PotemKinkade Villages…
my, my, my, someone hasn’t been taking their medication! You sound truly disgusted by the fake “wealth” generation. Just ‘invest’ in houses and sit on your ass while everyone else works for you? Is that how it is??
Probably you’re right, and most deserve to rot, but ……….really, you need to keep an eye on that blood pressure.
Diogenes
I notice you take issue with what I post, no matter what the topic.
so since yer gonna bitch no matter what, here’s a pre-emptive & hearty “Fuk Off” in advance for the next comment!
Okay. You’re right. I’m sorry.
aquis. Beautiful. Just beautiful brother.
I passed Indian Lake Estates every time my friends and I would travel to Vero Beach for a beach day when I was in high school (Class of 63). It does not look significantly different today; maybe a few more homes buried here and there. It looks as if it should still have the giant 50s sign beckoning travelers (northern variety) to:
See the giant alligator! or
Florida orange juice! All you can drink, 10 cents! or
Air boat rides! 50 cents per person!
Somebody here said the market needs knife-catchers, and we have them.
The sheeple will always be the knife catchers who end up learningthe hard way and then walk away from their financial responsibilities thus dumping it on the rest of us.
“When she woke up Wednesday morning, she had no idea she was going to buy.”
Long way to go.
“Builder and real estate investor O.J. Buigas bought 82 houses and 34 town houses from Miami-based Tousa Homes Florida LP, parent company of Engle Homes, which filed for bankruptcy in January.”
Investors still buying??? making sure J6P doesn’t get affordable homes??
I think it’s a wonderful investment.
Heaven forbid it be a home. Gotta’ be an investment.
Yup - long, long way to go.
At the moment I don’t have anything I consider investments. I have a lot of assets, including a lot of cash, but the way things are lately I don’t count on any of it to be worth more in a year or two. My aim is to ensure they depreciate less than everything else and even that gives me heartburn.
Yesterday many sites said that the rates for fixed mortgages would rise and for ARMs would fall. Today I go to Bankrate and see that the opposite apparently happened. Gives me vertigo.
“‘We had thought about it and said no,’ Dickson said. ‘But I think the price I saw today convinced me to buy. I think it’s a wonderful investment.’”
These people must be deaf, dumb and blind. She probably has purchased a cemetary plot and views that as an investment also.
700 lots with only 100 people in line who only went under contract and still have to qualify?..hmm..how many in that community will be underwater? Or walk away?
Even more people showed up at Coral Lakes today. The prices there are pretty cheap for the area…but it is a gated community, which means HOA fees and all.
“If you don’t have to sell your house, don’t”
Such disingenuous advice. So, only speculators, the over-extended, and folks leaving town (possibly because they are/were in RE/construction biz) should be selling?
I think there’s a compelling argument that it’s the people who still have some equity - long time owners - who should be selling, and preserving that. Of course, that’s ahard as hell to do - box up 10-20 years worth of living, and move to a rental (same size, or down-sized) instead. Who has the energy for that?
Since I started reading this blog 4-5 months ago, I’ve been thinking of renting a room somewhere or moving to the marginal side of town and living as cheaply as possible…until there is some semblance of a bottom, and then only if I find a decent home at a price I want to pay (I’m in my late 30’s and single, income is 150-200K/yr depending on how much I want to work).
The ONLY reason I haven’t done it yet is because moving and selling my excess junk sounds so exhausting. I guess it’s a stupid reason but psychologically hard to overcome.
I moved from a large apartment to a smallish house in early 2003 — I bought the house in August 2002 - but had some painting and other light work done on it (it’s still a work in progress, and I enjoy it). So, I was able to just move myself, bit by bit (just a few blocks - and I got rid of old furniture in the process).
I couldn’t believe the amount of crap I had accumulated in that apartment over the 9 years there (I had huge closets and my own big laundry room). It was acutally good that I moved, just to get rid of a bunch of the junk — I still have some overly-accumulative tendencies, but at least I am aware of them and fight them to some degree.
Some advice for 20-somethings just starting out - be careful/mindful of what you buy, and even what you allow people to give you. Many possessions own you as much as you own them. (Also apt advice to consider when buying a home these days).
I hate to clean..I hate to have things pile up..So I always ask myself before I buy something, “Do I really need that?” About 80% of the time, I don’t buy it.
The last couple of years, my neighborhood (near Portland, OR) was hit with the “rip-down-what’s-there-and-build-the-high-end-McMansions” plague. Each time, all I could think was, “okay, you bought it at 1.4 or 1.8. Now, you’ve got to go spend MORE money to buy stuff to fill up all that square footage–and you’ve got to hire someone to clean, because it’s so freaking huge!”
One option for unloading excess stuff–see if there’s an Ebay seller near you. You’ll have to pay them a commission, but the stuff will be gone. Opton B: Do the Goodwill thing.
Or sell it on Ebay yourself. I do it all the time. Half the time someone will pay for something I’ve used more than I paid new because I provide a better description and better photos.
I have ‘overly accumulative’ tendencies, too, particularly with books. I have much too much, by a ton or so. On the plus side, though, they seem to be good insulation.
Oh, who am I kidding. There’s no such thing as too many books. In fact, I probably need a few more, because I saw a blank spot on the wall just the other day.
Ha ha - books are soooo hard for me to get rid of - and absolutely impossible to throw away. I make a special effort to try and get the best ones to friends or libraries, and the lesser lights to the thrift store.
Fortunately, I now live two blocks from a library. With some patience, and online-seaching, you can get a whole lot of interesting and often-current books. Just finished the recent Halberstam book on the Korean War — saved myself $35 and some shelf space, to boot.
Hire someone to help you do it!
Leigh
I’m thinking I should just take an armload of crap to the Salvation Army and St. Vincent de Paul every weekend…it will probably take me 2-3 months to get rid of everything that needs to go.
Ebay/craigslisting everything and playing the selling game would be too time consuming for what I would get for it anyway. I could make a lot more money devoting the time spent to my job.
I’ve found that Craigslist is fantastic for furniture you want to get rid of…put it on there for free, and someone will generally pick it up within a day or two.
Yeah! Hire some out-of-work realtor to come in a stage your junk. I hear it adds such value to your house.
The ONLY reason I haven’t done it yet is because moving and selling my excess junk sounds so exhausting.
Adevertise as an estate sale and your excess junk will be gone in no time. people love to think they are getting bargains at the estate sales. Once you rid yourself of the excess, find a small house to rent for the time. There are plenty of these in the Tampa Bay area!
“box up 10-20 years worth of living, and move to a rental (same size, or down-sized) instead.”
We did it in 2006 — sold and moved to a rental, put most of our “stuff” into storage. We’re now in a large, comfortable rented house — twice the size of the house we owned, and with lower monthy expenses (although we HAVE moved to a rural town).
The main hassle of moving is organizational, which I don’t mind. I just pay others to do the heavy lifting, not that big an expense in the grand scheme.
“‘The upper-end homes have really fallen down,’ McGuire said.”
These creeps need to follow the through to the logical end. If $1.2 million behemoths are now 600k, that compresses every other price point under 1.2 million so it isn’t just the high end that gets battered. But they conveniently leave out those little details.
If $1.2 million behemoths are now 600k, that compresses every other price point under 1.2 million
I’m not sure I follow your logic.
‘High end’ homes are obviously hard to sell because more people can’t qualify for the mortgage these days, don’t want to tie up their cash in a fungible but illiquid asset, or risk buying a depreciating asset (i.e. a 10% loss on a 1.2M home is 120K, which is a lot of money).
Lower end (i.e. affordable) stuff only has the limitation that people are holding out for a better home at their own affordability point. Why should home sales at each ‘price point’ pancake at exactly the same rate, if the number of potential buyers stays relatively constant, but the amount they can spend is significantly decreased?
Affordable homes (unless in bad condition) will always move faster than ‘high end’ homes because at least people can afford them, and stand to lose less money on their investment if prices drop (i.e. a 200K home dropping 10% is only losing 20K, a sizeable amount but not nearly as scary as 120K).
Sounds like realtard logic to me. So the 1.2million house is now at the 600k price point. What happens to the 600k house circa 2005 today? Does it levitate at 599k? If you had 600k cash and a reliable cashflow would you buy a 1.2 million shack for 600k or buy a 600k shack for 599k?
If you had 600k cash and a reliable cashflow would you buy a 1.2 million shack for 600k or buy a 600k shack for 599k?
I can’t afford to spend 600K, so it is irrelevant in either case. I suspect that most other people can’t spend that much either, especially right now. The credit bubble has changed economies of scale, and market uncertainty has obviously changed demand.
It makes more sense to live without the granite countertops and purchase something within budget than s-t-r-e-t-c-h for the most expensive house you can buy…once the market slide has stabilized, of course. Then you can always sell it as a ’starter home’ and move up, if you think you deserve better.
It’s not irrelevant it is exactly the point you’re denying.
I consider $600K to be ‘high end’, as would most people under traditional lending standards. That is exactly my point. I’m talking about economies of scale for affordable homes vs. high-end homes.
And I’m talking about what compression does to pricing which you conveniently avoided by personalizing. But I’ll rephrase the question;
If a BUYER had 600k cash and a reliable cashflow would he buy a 1.2 million shack for 600k or buy a 600k shack for 599k?
“I’m talking about what compression does to pricing which you conveniently avoided by personalizing.”
No, you are changing your argument. The comment I responded to was this:
“If $1.2 million behemoths are now 600k, that compresses every other price point under 1.2 million”
If you think about it, the number of buyers for high end homes (I don’t know the cutoff…$500K for traditional standards?) is decreasing, while the number of new units dumped on the market recently have been disproportionately in that category.
Conversely, there are now more potential buyers in the lower end because of changing credit standards, and for those still in the market, I suspect more ‘demand’ for homes in their price range (for 80% if people in my community, it would be 250K under traditional standards).
It would make sense that the housing market would have differences for high-end vs. low end, right? Therefore varying rates of “compression”.
Your argument only makes sense if there are equal numbers of buyers in each price range, which there isn’t. The distribution of buyers is a normalized curve whose peak has shifted due to factors that influence all buyers, and not a randomized poisson distribution.
No, you are changing your argument. The comment I responded to was this:
“If $1.2 million behemoths are now 600k, that compresses every other price point under 1.2 million”
That point is not hard to understand.
Things that were 1.2 M are now 600K.
Therefore things that were 600K must now be priced lower, say 350K, to compete.
Therefore, things that were 350K must now be priced lower, say 200K, to compete.
And so on.
Pretty easy isn’t JP?
Said another way:
People at every income level can borrow less money now than they could have before credit standards changed.
Therefore, all prices must fall in order to meet the demand.
I never said prices wouldn’t fall in all categories, just that the drop of high end homes will not translate into a drop in lower end, at least not in the short term. All prices clearly falling anyway, but a price drop of a million dollar home doesn’t translate into a similar price drop for an inexpensive home because they are different markets.
For example, there is more demand for lower priced property (among “motivated” buyers), so there is more competition for it than for higher priced property. Dropping a house from 1.2 M to 600K doesn’t change the fact that it is still high end property, and still going to only be affordable to essentially the same demographic (maybe now 10% of all buyers instead of 4%). The overlap for this demographic with the majority of homebuyers is fairly small. If 80% of ALL homebuyers, for example, still cannot afford more than 400K (i.e. the “lower end”), how does that high end 50% price drop translate into *similar savings for them…especially when there is much more competition for lower end property? Until there is equilibrium, I don’t think that 50% off of the McMansion will cause a wholesale drop at ALL price levels. It makes no sense.
Economies of scale suggest different markets. Supply and demand…Economics 101. That doesn’t mean I wish it weren’t the case (because I do)…it’s just that it is not what we’re seeing.
Finally, would it make as much sense to say that if a 200K house dropped to 100K, then a 1.2M house will drop to 600K? Nice if it happened, but you won’t see it, because they are essentially different markets…
There are a lot of reasons for “varying compression”, and this is happening now, and I’m not the only one who is noticing it. See Tim’s comment in the discussion below.
“I don’t think that 50% off of the McMansion will cause a wholesale drop at ALL price levels.”
Price compression makes sense and it is very logical. Nobody, not one suggested a 1:1 ratio as it relates to different price points. Show me where there is a growing pool of buyers in ANY price range. You talk of a limitless supply of entry level buyers and it is the entry level buyers that kicked the second leg out from the appreciation train. Without them ALL inventory grows and price falls on entry level shacks which is the very price point you claim won’t fall. Add ontop of that flimsy entry level price structure all the price points above it and you have price compression. It is REAL.
Now… Back to the original hypothesis; What is keeping a shack with a 2005 value of 600k from falling when the $1.2 million shack down the road got cut to 600k?
Economically speaking, if the % of qualified potential buyers drops significantly higher for upper bracket homes than lower income homes it is true that you would expect varying compression. I saw this in the 80’s crash. Once you got above the $500k mark, you got much more for each additional dollar you spent then you did for your initial spending dollars.
Tim - that’s an interesting addition to the discussion because it is true. On the surface, it doesn’t seem logical to me, math-wise. But that’s probably because there is an increasingly unequal distribution of incomes that can support the marginally-more expensive house.
Same is true in rentals, at least here in central Florida. Any place that would cost 2/3 of what I pay in rent would be 1/2 or less as nice or as large.
That is true in the Bay Area as well. There is a price point in every market where if you can get beyond, you get a MUCH nicer house.
Shockwave like.
The compression is happening, however the psychological hit to the pups is hasn’t. If you were in the market for a 600K home one year ago, you have to mentally adjust your expectations to move into a 300K neighborhood. When people lower their expectations and learn to adjust their lifestyles, the lower end will firm up. This will happen eventually, even if it has to be reinforced by the new, more stringent lending standards.
“‘The upper-end homes have really fallen down,’ McGuire said.”
This was where people were most duped into believing they were safe. I write about my friend all the time who bought that garbage. $525,000 in 2004 (before things got too heated) is $350,000 today and still falling with no end in sight.
It’s these people that I think of today while I watch TMA fall through the floor. At least with equities, you can typically only lose 100% of your initial investment. With houses in FL, it’s pretty typical for people to lose 1000% (or more) of their initial investment (down payment), with little/no hope of ever recouping the losses. Leverage.. It’s a killer on the way down!
“…it’s pretty typical for people to lose 1000% (or more) of their initial investment (down payment), with little/no hope of ever recouping the losses. Leverage.. It’s a killer on the way down! ”
Most people didn’t put any money down so all they’re really losing is the moneny they would have saved by renting.
Before “E-Z CREDIT” there may have been some truth to the “high-end homes hold their value”. Back in the day when you needed 20% down and a sensible debt-to-income ratio, the only people who could afford multi-million dollar homes were those with cash to buy them outright.
And, there were fewer of them. Some ritzy communities in LA, or isolated island communities in Florida, a few prime blocks with park views in NY.
By this logic, of course, real high-end homes would still hold their value. We’re talking $5M and up. However, there was such a massive overbulding, and so much “quick bubble wealth created” that there’s even a glut of homes at this level (Isleworth, FL, for example)….
“Before “E-Z CREDIT” there may have been some truth to the “high-end homes hold their value’”
True statement, but that’s also when a $900K home was really something to marvel over. I remember in Palm Beach County in 2004 and 2005 when $900,000 was just slightly above average.
Ah . . . the days when a 500k home was a stunning piece of architecture rather than a starter home. It seems like just a few years ago for some. Oh wait . . . it was. Who says you cant go back to the good ol’ days?
[The Bradenton Herald. “There is quality product out there selling for under $100 a square foot, said May Aston, sales associate with Re/Max Alliance Group and immediate past president of the Manatee Association of Realtors.”
“‘It was $200 a square foot at the height,’ Aston said.”
“‘We’re kind of having a half price sale,’ said Patrick McGuire of Coldwell Banker in Lakewood Ranch. McGuire recently worked on a sale where a home that would have sold for $1.2 million during the height of the market sold for $600,000.”]
I live in Bradenton. While I am not in the market for a home (I own, free & clear), I have followed the east county market for a while. What I see is that national builders have been having some large reductions on factory homes but local builders and existing homes have been sticky (and not selling).
The amazing thing is that local builders seem to keep building although at a very low pace! I have a fear that some local banks are going to be in for a rude surprise when the market doesn’t come back (the way real estate shills are saying) and these local builder/developers run out of “holding for the comeback” funds.
Cracker, I see the same thing in NY. Small time guys that do 4-5 shacks a year are digging in their heels on price while Lennar and Toll slash prices and sell, albeit at a very slow clip. Sooner or later, the small operators will capitulate but I can’t imagine the excruciating pain and frustration they’re feeling right now. One turd of an excavation outfit down the road has two shacks under construction on same road right now. I have NO idea what he’s thinking…..
“I have NO idea what he’s thinking…..”
My guess is that he’s thinking: As long as my bank loans me money to build specs AND I can draw management/supervisory fees from the construction loan to keep groceries on the table and make my F350 payments, life is good. Small-time builders (as long as they can borrow) will continue to build . . . what else are they gonna do, cure cancer or pursue their dreams of playing in the big leagues?
I would also bet he’s beating up his subs for better pricing and working on extremely skinny (if not non-existent) margins. It will only stop when the local banks stop lending him money.
The guy that owns the excavation company is a lying puke so I’d never get the truth out of him but he’s definitely not a brain surgeon. The last time I talked to him (last fall) he pretty much acknowledged that housing is tanking.
Actually the guy sounds a lot more honest than USA Today’s #5 top economist:
http://www.usatoday.com/money/economy/2008-03-16-top-economist_N.htm
(see #5, about half way down)
No wonder people have such problems when wire services pick up a story from the NYTimes like “Even Experts Can’t Grasp This Crisis,” and it goes on to say “But people — by “people,” I’m referring here to Mr. Greenspan, Mr. Bernanke, the top executives of almost every Wall Street firm and a majority of American homeowners — decided that the usual rules didn’t apply because home prices nationwide had never fallen before.”
What did I just read??? So I wrote a polite letter to the journalist with the statistics and commentary I posted at GreatRedDragon.com and never heard back. Guess Mark Twain was right when he said, “If you don’t read the papers, you’re un-informed. If you do read the papers, you’re mis-informed.”
“‘We can’t sell homes for $500,000, $600,000 and $700,000,’ Emery said. ‘People just don’t qualify for those sorts of homes anymore.’”
They never did qualify for them. So his business plan depended on the permanent continuance of fraud, greed, and stupidity. Good plan.
Price I can comfortably afford under traditional lending standards: $400K
Price I would like to pay given my other financial goals: 250K
Price of kicking back in my rented condo while I watch the bubble burst: Priceless.
You’re smart for not wanting to go for the biggest home you can qualify for. We “underbought” our home 17 years ago. The RE agent and lender told us we can go much higher.
Of course, you know the punchline. Our house is 100% paid off. We now have very little to worry about, other than the prop-13 protected property tax.
Between me and my significant other we could have “qualified” for quite a bit, probably over 400K. I would not consider playing that game, I wanted something I could easily afford on my own just in case, and after a long wait found a 3 bed, 2 bath doublewide on a plot of land (considered real estate, no dealing with trailer park management). In an area where TH are priced over 350 and the crappiest condos are near 200K, I got this for 143 last year.
Good thing too, because now we can afford to live off one income once our baby is born.
“Semore Borker says it’s pretty obvious why population growth has stagnated. ‘I have found that Florida and Palm Beach and Martin counties are no longer a retiree’s paradise because of the expenses,’ said Borker”
Wait a minute - aren’t retiring baby boomers supposed to move to Florida in droves. What is going to happen to all these $500K condos that were built in expectation of the coming wave of retirees?
Seems they all went to Lee County on the West coast. It had about 20,000 move in last year. Of course, that’s down from the 28,000 the year before.
I remember this book from my high school days;
“Under the Grandstand” by Semore Butts.
SFBAG,
Let me guess… drinking coffee…. no fog today?
http://tinyurl.com/2jcn7g
Bernanke’s Own Home on Capitol Hill Shows Housing Boom and Bust
By Brendan Murray
March 20 (Bloomberg) — The U.S. housing recession has arrived literally on the doorstep of Federal Reserve Chairman Ben S. Bernanke.
Bernanke lives in Washington’s Capitol Hill area in a four- bedroom, 2,600-square-foot house he bought new in May 2004 for $839,000. Almost four years later, it may not be worth any more, according to real estate records and local agents.
I think this small bit of fact explain a lot about his monetary policy. Could he be a FB in disguise? If so we are sure F*&ked!
Cinch
This goes to show how truly insulated these wonks on the Hill are. Why would you “buy” in 2004. It made no financial sense, unless you were counting on continual inflation.
That’s REALLY SCARY! Obviously this schmuck wants MORE INFLATION. It benefits him and other “asset” holders. For those with real “jobs”, we lose.
We need to destroy the FED before it destroys us.
“Real estate records show Bernanke’s next-door neighbor’s house sold in July 2007 for $880,000, 4.9 percent more than Bernanke’s purchase three years earlier. A home four doors down and comparable in size and condition to Bernanke’s has been on the market for five weeks at $899,000, after a failed attempt to sell for $988,000 in 2006.”
Imagine an FB running the Fed! This news is very depressing!
Cinch
But look at the other side. Bernanke has a guaranteed job at the Fed for something like 15 years. Even if he is no longer head of it he still gets to hang on until his term at the Fed expires. Plus he makes close to $200k a year (with COLA) whether he is head of the Fed or not, just so long as he sticks around.
I’d bet he thought he could later move on to an even higher paying deal in a few years but his reputation is taking a real hit these days. Either way you slice it though, he has no real problems as far as his personal finances go. He probably paid something down on the new house from his old NJ (Princeton) place, so whats to worry about? Nothing for him.
Remember, Ahnold said nobody come see this fall come. I guess we here are all no one.
Black Vader needs to go back to making films, if he thinks he’s still capable of suspending disbelief…
Anyone else having trouble finding the bits bucket? I came late today and all I can see is this post and no sidebar stuff.
All better now.
it would be great if first time buyers smart up and insist on tax abatements (say, no property taxes for 30 years) in order to buy. that will compensate for the run up in home prices, shifting the tax burden to current home owners that enjoyed the bubble.
Martha - that’s an interesting idea. Of course, it’s never gonna happen on a 30-yr basis, but in Florida, where SOH was and is so contentious, it could help communities get houses and condos filled and smug Joe Saved My Home would get to participate.
Palmetto - if you’re on - what do you think?
As for Florida property taxes, I was just reading an appraiser’s comments that even if you buy a house in December, the appraisal for tax purposes is based on valuations as of January 1 of that year. Not bad in a rising market. But in a rapidly falling one, and with a tax and revenue environment as dicey as Florida’s at the moment, it’s too bad no one is writing that it therefore makes sense to wait until the bottom is done and gone and prices are starting to rise, before buying and locking in a save-our-homes tax assessment.
folks in FL wil learn how many gov workers and goofy programs they can do w/o
plenty is my bet
just wondering, if the financial crisis(sissy nation)is over
how come all the houses on my street are still for sale ?
“People are buying now because even if it’s not the bottom of the market they are realizing they might not be able to afford it if they wait”
Here we go again, buy now or be priced out forever.
O.J. did it.
“Builder and real estate investor O.J. Buigas bought 82 houses and 34 town houses from Miami-based Tousa Homes Florida LP, parent company of Engle Homes, which filed for bankruptcy in January.”
“Pinellas County near Tampa dropped by 5,456″
So much for the, “U-Haul stats don’t matter” crowd. As it turns out there is a relationship between moving trucks and people moving.
All I can say is >>>>>>>>>>>>Please take a friend with you when you go. And tell everyone you know how much you hate Florida and never plan to return.
Wow
Just was checking a sample of fsbo houses on Redfin in Brentwood CA. Lots of houses and most I checked priced way under the last sale price.