It’s A Happy Day In California
The Union Tribune reports from California. “Even before the doors opened, dozens of people had gathered yesterday outside Golden Hall at the downtown Community Concourse to attend a free clinic for financially distressed homeowners. ‘You can tell how hungry for information people are from someone they feel they can trust,’ said Gabe del Rio, president of the nonprofit Housing Opportunities Collaborative. ‘Everyone said, ‘You’ll be able to refinance out of this.’ That is the case only if you have equity.’”
“There were 1,316 residential foreclosures countywide in February, a rise of nearly 244 percent over February 2007.”
“Thomas Frantz, a transit maintenance foreman, said his lender had been unwilling to modify his financing. his monthly mortgage payments had risen from an initial $1,989 to $2,767, more than he could afford. ‘We got into the property with no money down 2½ years ago,’ he said. ‘We didn’t really know what we were doing. They never explained about the loan, just: ‘You qualified; here’s your new home.’”
“Alicia Prather, a community relations manager for GMAC ResCap, said she was able to help one household move from an adjustable-rate loan to a fixed-rate mortgage. ‘Our job is to keep homeowners in their homes, but it has to make business sense,’ Prather said.”
The LA Daily News. “David Day’s house-flipping strategy flopped and now he’s fighting for his financial life. Like so many others, he’ll likely lose.”
“Day and his family are on foreclosure’s doorstep, struggling to make mortgage payments totaling $6,240 a month. ‘I haven’t slept in five months. I wake up every morning in a cold sweat. I’m getting ready to go into bankruptcy,’ he said. ‘There is no money for food, basically.’”
“Day, a record producer who lives in Granada Hills, is upset that his lenders won’t modify the mortgages on either his residence or investment property. So far, all the assistance plans exclude speculators.”
“Howard Hack, owner of Howardsappraisal.com, sees it happening every day. ‘In many (of these) neighborhoods, half of the comps are foreclosures,’ he said.”
“The misery continues to build. As of April 4, across Los Angeles County in the past 120 days there were 119,663 pre- foreclosure proceedings initiated, 55,482 property auctions and 30,368 properties repossessed, according to Foreclosures.com. In the San Fernando Valley alone, there were almost as many foreclosures in the first two months of this year as sales.”
“Mary Funk, president of the Southland Regional Association of Realtors, specializes in foreclosures. Some of her clients have adopted a ‘cash for keys’ policy to minimize any damage left behind by a frustrated former owner.”
“‘If they deliver the keys to me and have the house vacant and broom clean, I hand them a check and they give me the keys and they are gone,’ Funk said.”
“That might become the best- case scenario - if you want to call it that - for Day, the investor. He said he’ll probably let the investment property slide into foreclosure and keep making the mortgage payment on the house he and his family have lived in for two decades.”
“‘We had no idea that this was the beginning of the end,’ he said of his attempt to cash in on a hot market that had chilled. ‘We got blindsided.’”
“While there are not many buyers in most markets, they share a common trait: tenacity. They are striking deals in a market with a distinct yin - record low sales - and yang - soaring foreclosures that are pushing supply up and prices down.”
“Richard Shih, who’s been house hunting since 2000, always knew that financial gravity would re-enter this overheated housing market. It has. And he just made an astounding deal. Shih recently paid $336,500 in cash for a house in the 22800 block of Crespi Street in Woodland Hills, a south-of-Ventura Boulevard property valued last May at $855,000.”
“‘I’m really interested in real estate and I’ve seen former cycles,’ he said. ‘I didn’t think these prices would be sustained.’”
“Sky Hoffman and Carrie Locklyn (are) the new owners of a 1,400-square-foot, three-bedroom, two-bath bungalow in Van Nuys, not far from their apartment. Their Realtor, Steve N. Smallson, said they had great credit and a 10 percent down payment so they breezed through the qualification process for a 30-year, fixed-rate mortgage.”
“The house, a foreclosure, was bought in 2006 for $679,000 and Hoffman and Locklyn paid $420,000, or 38.1 percent less than the previous owner.”
“The former owners were evicted and the house was full of their belongings. Squatters had moved in and the copper plumbing and three window air conditioners had been stolen. ‘I call this the Disneyland house,’ Hoffman said. ‘Everything is Mickey Mouse.’”
The Press Telegram. “Many real estate agents insist this is a great time to buy a house because so many foreclosed properties are on the market. But two years from now there might be even better deals, at least in Southern California, where the foreclosure situation is going to worsen.”
“‘We’re going to see more notices of default and more notices of trustee sales (foreclosures),’ said Michael Carney, executive director of the Real Estate Research Council at California State Polytechnic University, Pomona.”
“Carney disagrees with the popular argument that the real estate meltdown was caused by the huge number of buyers who obtained funky mortgages just to get into a house.”
“He maintains it’s a factor of price, not payment. ‘The main reason for the huge surge in foreclosures is that home prices didn’t keep going up,’ he said. ‘They started falling, and this simply caused people to walk away from these properties.’”
“‘Excess supply is responsible for much of the risk we’re seeing in the market,’ David W. Berson, PMI’s chief economist and strategist, wrote in his report.”
“‘Are we nearing the end of the current housing downturn?’ Bernson wrote. ‘We don’t think so, given the magnitude of the run-up in housing, with no significant housing downturn since the recession of 1991-92.’”
Inside Bay Area. “Struggling with rising prices and a stalled economy, a growing number of Bay Area families are turning to food stamps. ‘More and more, the people the food stamp program is serving are people who are working, but simply aren’t earning enough money,’ explained Jessica Bartholow, food stamp outreach manager at the California Association of Food Banks.”
“The housing crunch has hit particularly hard for East Bay families who rely on construction work, said Allison Pratt, director of policy and services for the Alameda County Community Food Bank. ‘They’re not really building that many new houses anymore.’”
“And phones continue ringing at the food bank’s emergency help line, where call volume was 26 percent higher in March than during the same period last year. ‘To us, that’s really a strong indication the families are struggling,’ Pratt said.”
The Marin Independent Journal. “Marin’s foreclosure rate has more than doubled over the past year, according to an agency that tracks troubled properties statewide. A snapshot of Marin’s foreclosure picture…indicated 581 properties have notices of default, are likely to head to auction or have been taken back by banks within the last 120 days.”
“Out of the 581 properties, 379 are in a pre-foreclosure state, 93 are in auction and 109 are owned by the bank. Novato and San Rafael posted the most properties in various states of foreclosure trouble, with 280 and 161 respectively, over the past 120 days.”
“Mark Lachtman, president of First Capital Group in San Rafael, blamed the economy and bad loans as culprits.”
“‘People bought property when it was much easier to get a loan with little or no documentation,’ he said. ‘Now that the economy is slowing and real estate prices tend to be soft and underwriting standards continue to tighten as we speak, we don’t have appreciation and you cannot refinance to get lower rates anymore.’”
The San Francisco Chronicle. “Mortgage relief? What relief? Despite the Federal Reserve slashing interest rates and Congress raising limits for conforming loans, the home-lending system is still in a logjam. ‘Right now, borrowers are still getting the short end of the stick,’ said Rob Chrisman, director of capital markets at Residential Pacific Mortgage in Walnut Creek.”
“If anything, mortgages are harder to get and - except for traditional ‘conforming’ loans to highly qualified borrowers - more expensive.”
“‘The mortgage market has been locked up since last August and is still as locked up today as it was Sept. 1, if not worse,’ said Guy Cecala, publisher of Inside Mortgage Finance. ‘This is clearly the worst mortgage market environment we’ve seen since the Depression.’”
“Ever since word leaked that Congress would redefine conforming loans in high-cost areas to go as high as $729,750, brokers were salivating at the idea of a potential gold mine of homeowners rushing to refinance. They hoped the new ‘conforming jumbos’ or ‘jumbo lights’ - loans between the old $417,000 limit and the new $729,750 cap - would carry favorable interest rates.”
“‘I have a pipeline filled with people who can’t (refinance) because these … jumbo lights are useless,’ Marc Savoy, a mortgage broker with San Francisco Pacific Mortgage Consultants, wrote in an e-mail. ‘The qualifying guidelines are onerous (i.e., income, credit and equity) and the rates are up toward 7 percent. Who’s that going to help? Not many people.’”
“An Oakland woman, who asked not to be identified, wanted to refinance an adjustable-rate mortgage on her $1.2 million house purchased four years ago. She and her husband have excellent credit and incomes, have 30 percent equity in the home, and are willing to pay down the current loan enough to increase equity to 40 percent.”
“In fact, they can easily qualify for one of the new ‘jumbo light’ loans - but they’re being quoted interest rates at a pricey 7.5 to 8.5 percent.”
“‘What that tells me is (banks) just don’t want to lend,’ she said. ‘(The new conforming limits) are having absolutely no effect whatsoever. $417,00 is still the conforming loan limit. It’s a travesty.’”
“Bill Boze, a Realtor with Prudential California’s Montclair office, said he sees the impact of the mortgage crunch every day. Boze said he represented a well-qualified couple buying a Montclair home for more than $1 million and making a 20 percent down payment - usually considered the gold standard.”
“At the last minute, the lender said that all of Oakland is now considered a ‘declining market’ where home values are sinking, and required that the couple put down 25 percent. They were able to do it, but it doesn’t bode well for future deals.”
“‘This ‘declining market’ thing of lenders approving you, then requiring an extra 5 percent down is kind of scary,’ he said. ‘It’s a real trap for people.’”
“‘Lending today looks really familiar to people who were lending 10 or 15 years ago,’” said Mark Brunelle, senior loan officer at Montclair office of the Home Loan Group. ‘Clients have to have saved up some money for a down payment, need to demonstrate ability to pay bills on time and need to show they earn enough money to make their payments. It’s only in 21st century Northern California where that seems like a radical proposition.’”
“Thousands have flooded county tax assessors’ offices in recent weeks in an attempt to lower their taxes, officials say. The trend is particularly evident in the East Bay and in Santa Clara County, which have pockets of some of the steepest declines in home values.”
“Take Paul Harrison of San Ramon, who bought his two-bedroom condominium for $605,000 two years ago. Based on what he sees his neighbors are selling their adjacent units for, he believes the value of his condo has dropped to the low 500s.”
“Harrison, who recently lost his job at ATA airlines when the company went bankrupt, already received a $500 reduction in his property tax from the Contra Costa County assessor, but plans to appeal for a greater reduction.”
“‘I’d love to see my taxes go down as much as anybody,’ he said. ‘Now it’s especially important. The only reason I’m getting by and holding on to my home is because I have savings.’”
”We’ve been flooded with requests for property tax reductions,’ said Gus Kramer, Contra Costa County assessor, adding that calls to his office have quadrupled in the past few months. They’re now receiving up to 500 calls a day from people eager to have their assessments reduced.”
“The higher call volume is partly a response to notifications that Kramer’s office sent to all homeowners who purchased properties since 2003, stating that they may be able to save on their taxes.”
“It’s also a result of the housing market tanking in the fast-growing eastern Contra Costa cities of Pittsburg, Antioch and Brentwood. A four-bedroom, four-bath home with a pool on a golf course that sold for $890,000 in August 2005 just sold for $530,000, Kramer said.”
“‘When I see that number drop that fast, it makes me take pause,’ Kramer said. ‘I think we’ve got to review a lot more of these properties.’”
“Alameda County has been similarly hard hit by the decline in real estate values. The county assessor’s office has received about 2,000 requests for property tax reductions in the past several weeks.”
“The county will automatically review the assessments of 65,000 properties and take additional requests individually, county Assessor Ron Thomsen said. Areas most likely to receive reductions include parts of Livermore, Castro Valley and Union City, which have seen declines in some cases greater than 10 percent.”
“In Solano County, Assessor Marc Tonnesen is doing a blanket review of 38,000 properties sold between 2004 and 2007. Between August and December 2007, his office received 1,145 requests for reductions. Since January, the office has received 1,875 requests.”
“Marin County Assessor Joan Thayer said while other county officials might bemoan reducing taxes, she is pleased when she is able to give a reduction. ‘If we see a pattern, we’ll jump right in,’ Thayer said. ‘It’s easy to lower values and taxes. It’s a happy day. Every once in a while, it’s great to do something nice for the public.’”
2/28/08
‘Association President Mary Funk said short sales are becoming more common now. She said some offers are coming in ‘way under’ the list price but that lenders are submitting counterproposals. And some are willing to pay the buyer’s closing costs.’
‘That’s good for buyers, she said. But severe problems persist. ‘The foreclosure situation is affecting prices. The problem is the buyers feel that homes that are owner-occupied should be going for the same price as a foreclosure or a short sale,’ Funk said.’
‘The problem is the buyers feel that homes that are owner-occupied should be going for the same price as a foreclosure or a short sale,’ Funk said.’
If they feel that way, perhaps they should consider buying a home in foreclosure or undergoing a short sale. My sense is that homes in these circumstances should sell at a discount to those selling at arms length with an inspection as part of the sale process. Nonetheless, I am happy that buyers are under this delusion, as it implies a further drop in demand and ongoing price declines with no bottom in sight.
Depends on if foreclosures are common enough to affect comps. At record fc levels in certain areas, why shouldn’t buyers expect this?
Don’t foreclosures set the new comps for their areas? If not, how will the short sale or foreclosure purchase price affect their neighborhoods?
BayQT~
Again, I think it depends on how common they are. When I have run comps it usually seems like there is always one really low comp (typically FC or a sale to family member) and one really high comp for an area. I usually throw those two out.
If, however, 3 or 4 houses in 10 came in low, I’d suspect more fc’s in the area and set my offer price accordingly.
As long as a FC or short sale house isn’t damaged and in perfect condition, itll sell for 98% of the price. Those FB’s are screwed. Those who are underwater have no choice but short sell or walk away. Those with any remaining equity can watch it evaporate away.
Every bull$hit sale counted on the way up. Why shouldn’t every sale count on the way down. As Marie Antoinette once said of the REIC, “let them eat $hit”.
Calm down; here have a beer.
In Ark, I don’t believe there is any option to inspect a house before the foreclosure auction (unless perhaps you arrange something with the current occupants). Additionally, there is no gaurantee that the house will be in the same condition as you inspected if somehow you were able to do so.
In contrast, in a normal real estate sale, part of the standard sales contract says that the house is being sold in the same condition as the time of some inspection. If you, the new owner, were to arrive at your new purchase with previously nonexistant problems (such as missing copper) you would have recourse.
In my opinion with regard to how “fair market value” is determined there are several problems with foreclosure auctions. However, it seems to me that everyone should agree that the risk I point out above should dictate a discount on foreclosure auctions to a “normal” sale.
Because there are risks associated with buying foreclosures or short sales that are not present when buying a home through an arms length sales process with an inspection. I am not saying that foreclosures have no value as comps — just that they may slightly understate what one might have to pay through an arms length sales process, as foreclosure buyers enjoy a risk discount (negative risk premium).
Buying via short sale or REO shouldn’t be more risky than normal, since the buyer can specify subject to inspection, clear title, etc. With an auction however it’s totally buyer beware.
At least this is what I’m gleaning from learning about this stuff, for possible future reference as a foreclosure buyer.
A house is a house. The issue is not who is in it, the issue is what condition it is in. Sellers are delusional if they believe buyers should pay more because they happen to be living in the house. If the condition of their house is the same as the condition of a comparable house that is vacant or in foreclosure, why would buyers pay them more? In fact, shouldn’t buyers pay them less–they’re going to have to schedule a move out day, and that may not be convenient for the buyer.
IAT
The point ProfB is trying to make is they won’t even let you in the door of a foreclosure. You bid as is. The deserves a risk premium to be sure.
I just sold to a buyer who was only looking at REO’s. Because of that he fell in love with my house (most forecolsures are dumps and dirty) and my “decorating style” He lowballed me but I knew he was a cash buyer. He wouldn’t negotiate so I told him “as is” which is what most REO’s go as. I even made him pay for the termite inspection. I am renting back to give me time to pack up and he will owe me another check because I made him pay for the outside fireplace, fountains and he wanted some of my furniture. A “win-win” as far as I’m concerned…although my neighbors hate me as a comp killer, but it was a matter of time since theree are 8 foreclosures in the tract. I still came away with $200/sqft and profit for me!
Wonerful brain - congrats.
Be careful out there!
Best,
Leigh
Er…wonderful - hanging head in shame.
I ( along with BK judge John Hargrove) were the first speakers at at the San Diego Housing Opp. Collab. Sat. I was amazed at the number of people who came up to me afterword and said “we were cheated”. SD Councilman Tony Young opined that too many in local city Govt. are not yet in touch with what is happening. There are local top level Govt. emps. that are concerned with the problem BUT there is very little they can do.
Knock Knock…
Q: Who’s there?
A: Fore!
Q: Fore who?
A: Foreclosure, you’ve got 20 minutes to leave.
LOL!
You made me spit my soup out!
“David Day’s house-flipping strategy flopped and now he’s fighting for his financial life. Like so many others, he’ll likely lose.”
“Day and his family are on foreclosure’s doorstep, struggling to make mortgage payments totaling $6,240 a month. ‘I haven’t slept in five months. I wake up every morning in a cold sweat. I’m getting ready to go into bankruptcy,’ he said. ‘There is no money for food, basically.’”
Day-o, Day-ay-ay-o
Daylight come and me gonna lose home
Day-o, Day-ay-ay-o
Daylight come and my flipping days are done
You are on a lyrical roll today.
I once did one one on “Californian Dreaming”. but didn’t save it somewhere. Started off with “All the lawns are brown…”
I saved it Houston. what month?
Check out this laid back site.
Howardsappraisal.com
yawn, slobber, gag
I’m thinking that Jo Dee Messina song “My Give a Damn’s Busted” fits this guy to a ‘T’.
“There is no money for food, basically.” C’mon dude, you own investment property in the Valley.
Well there’s always HELOC food stamps….
Well, he’s rich, rich, rich. He owns a lot of properties.
Zippy-doo-day-zippy-doo-dah!
It’s a lovely evening for some schadenfreude.
I saw an SUV this morning here in Southern Cal with personalized license plate “FX N FLP” (fix and flip). They’re still out there.
Give the guy a break. Didn`t you hear? He`s struggling.
April is here, which means CA property taxes and Income Taxes. If you have a job with tax withholdings, and an impound with your mortgage, you won’t feel it so much. If, like most self employed (like most in the RE/construction industry), you pay estimated taxes and bi annual property taxes, April can be the cruelest month.
I didn’t know CA charges property taxes twice a year! So that 1% prop taxes is essentally 2%.
In Florida it’s 2% but paid only once a year!
No, it’s one percent in California. You just break it up into two payments, twice yearly.
A happy day in Morro Bay CA. A year ago in this zip code, foreclosure.com was reporting 1 foreclosure and 3 preforeclosures. Now it’s 3 and 12. Still not much by IE/SD/Sac standards…a lot of buying here is done with cash. My post yesterday about 7 properties here with a mean asking price of $397K and a mean monthly rental value of $1050 prompted some good HBB laughs. (The used house salespersons would tell you you’re going to make it up on the appreciation.) I hasten to add, that’s why I’m just a renter here. Not even a year-round renter.
when are prices going to crash in Palos Verdes Peninsula, CA? - that hill you see out of pilot side of Jet just before you land at LAX from East.
a watched pot never boils..
Its starting to bleed. Be patient. In 1993 they screamed how in PV prices wouldn’t drop. In 1994/1995 they dropped 40% in RPV (maybe 18% for non-condos/townhomes in PVE). The larger lots traded less and didn’t drop as much.
Be patient. Its one of seven markets we’ll consider (dependent on a corporate reorganization this summer).
However, I’ve been looking on propertyshark.com at the mortgages. There is far more downside potential in Redondo or the true “Riviera Village” part of Torrance. Those areas are set to implode and will pull down PV.
But PV is a retirement community now. It wasn’t the trendy place to flip and thus isn’t as precarious as some. Oh, I think it will go down 40%; but it will be slower and with more interesting press releases.
Got Popcorn?
Neil
Neil,
Are you basing your prediction for a Redondo and Riviera Village implosion on large mortgages alone or are you making an educated guess on the incomes in the area?
“However, I’ve been looking on propertyshark.com at the mortgages. There is far more downside potential in Redondo or the true “Riviera Village” part of Torrance. Those areas are set to implode and will pull down PV. ”
Riviera village and entire Torrance community is frozen as to sales. Too many retired folks & and stubborn sellers still holding out. So far Torrance and the PV are holding firm but the dam will burst eventually. Unlike many S Cal watchers i don’t see much upside in Sbay at all- to much traffic, too many malls and plenty of marginal areas at the rough edges of the Sbay. SB Beachs waaay overrated and quite inaccessible to most LA residents. Only thing the Sbay has is a diversified economy and jobs sector but House prices still way out of whack with medium incomes in the SB. Homes way over priced and those stubborn holdouts will cry uncle eventually.
Torrance is the great middle- class anchor community of the Sbay- if Torrance RE starts diving then entire Sbay including PV collapses.
PV prices are down about 10-15% from the peak, mid 2006. I am still seeing surprisingly strong appraisals, compared to other areas (I do a lot of home loans here.) Prices are very high, but people can afford their loans better than many other places. With the average home 40 years old, there are some small loans along with the big. The retired and stubborn who do not have to sell is a positive factor, and that helps the market. Commuting from some parts of PV is not fun, but weather is great (it was 96F here today.) Regarding beaches, yes on what you said in general, but there is a hidden jewel (Torrance beach) that is uncrowded, safe and underrated. Will prices continue to drop? My guess is yes, probably another 10-15%, but overall less than other areas. When will prices in PV increase? Probably in 5-8 years.
one house on the hill is listed at 799,000 have not seen this in a while
–
That is where my “little brother” (an adapted little brother and we travel together once or twice a year) lives and he refied to 95% last year and took out his HELOC a week before CFC clamped down. He is fully prepared to walk away (there is no contingent liability).
My estimate is that when the recession turns into a severe recession, or worse, you will see high-end zip codes take a sizeable haircut. He bought his house on the hill for $650K in 1994 or so. It was worth close to $2M at the peak. There are very few sales to get the current market price.
Jas
“adapted little brother”
T.M.I.
–
You caught it! I have two adopted little brothers in America, one a Scot and one born in India. They think that big bro knows better! I tell them what I think regardless of what they might want to hear and they respect that part. I remind them that I could be wrong you know.
Jas
Every few weeks you make the same exact post, Stanley. While a few of us may know that the pilot-in-command rides on the left, I doubt most people are aware of it. How about, Palos Verdes is that hill just south of LAX?
Sad news…
Our house we sold in RPV almost 3 years ago, and which Zillow’d for $50k more than we sold it for as recently as a few months ago, is now worth $200k less than we sold it for~
Awwww…..
no…..BWAHAHAHAHA…..
Too many conflicting emotions… head exploding
(Lad - good work, fella!)
Santa Monica, Venice still way expensive too, prices seem to be actually rising, un-freaking believable. I guess when you have a population of people invading this area who are either gay couples or dual income straight couples with no kids, just a shitzu or something to pay for, price isn’t an issue. Apparently these kind of people are still able to get financing, too.
“Mary Funk, president of the Southland Regional Association of Realtors, specializes in foreclosures. Some of her clients have adopted a ‘cash for keys’ policy to minimize any damage left behind by a frustrated former owner.”
“‘If they deliver the keys to me and have the house vacant and broom clean, I hand them a check and they give me the keys and they are gone,’ Funk said.”
We’ve successfully turned adults into children and vice versa, in these United States…
–
“David Day’s house-flipping strategy flopped and now he’s fighting for his financial life. Like so many others, he’ll likely lose.”
It is called a flip-flop. A term for an electronics device when I went to college.
Jas
A flip-flop is a cheap $2 sandal that makes a satisfying sound when you walk.
Which to confuse the issue even further used to be called thongs.
And now thongs refer to inappropriate beachwear for certain older folk …
I remember zorries when I was a kid.
OMG, I totally forgot that we called flip-flops Zorries. I’m having a flash-back.
Marin Foreclosure example:
150 Oak Ave San Anselmo 4 beds, 3.5 baths, 1,861 sq ft
02/27/2008: $925,175 *
07/28/2006: $1,250,000
02/10/2005: $765,000 *
04/09/2004: $812,051 *
02/03/2003: $980,000 *
11/23/1999: $379,000 *
04/20/1999: $240,000 *
05/08/1998: $380,000
Nice location.
http://www.trulia.com/homes/California/San_Anselmo/sold/787681-150-Oak-Ave-San-Anselmo-CA
A 26% price drop in Marin County? I thought it was different there.
Really. Who’da thunk it? I suspect a lot of Marin County wannabe-residents jumped in, and they (as well as those who “pulled” equity out) are in trouble now.
Oh, well…hard lessons to learn here. But do you think they will heed the lessons? Time will tell.
BayQT~
“I suspect a lot of Marin County wannabe-residents jumped in, and they (as well as those who “pulled” equity out) are in trouble now.”
Amen. I live in Marin, and it’s AltA & HELOC Central. The “competitive spend” mentality is so ingrained here.
And that is sad….to need to buy yourself a lifestyle. To go into humongous debt in order to impress others (or yourself, as the case may be). And then to find that you don’t know what to talk about at dinner parties (if you even go now) because the main topic of conversation was how much you or your house is/was *worth*. What do you talk about now? Do you even talk to your neighbors? Sure, conversations still flow, but more people are now “faking the funk” to save face. That will only work for so long.
BayQT~
Holy crap! $600K in 4 years? (’99-’03)
There were places in San Diego County that went up more on a percentage basis from ‘99 to the peak than that Marin County example.
Amen and “now” its falling faster with few qualified real buyers left and knowing prices are heading down further. As they day only a real fool would consider buying in a falling market.
Shih Happens…
“Richard Shih, who’s been house hunting since 2000, always knew that financial gravity would re-enter this overheated housing market. It has. And he just made an astounding deal. Shih recently paid $336,500 in cash for a house in the 22800 block of Crespi Street in Woodland Hills, a south-of-Ventura Boulevard property valued last May at $855,000.”
Shih recently paid $336,500 in cash for a house in the 22800 block of Crespi Street in Woodland Hills, a south-of-Ventura Boulevard property valued last May at $855,000.”
Is that a good deal or not? California is like a whole continent away from me.
Who knows what condition the house is in, but it seems like a price you’d have paid in 1998, in Woodland Hills.
Well id say so-so. It would depend on how the bailouts cap bottom prices. If no bailout, that house could bottom out at $200k
“Shih recently paid $336,500 in cash for a house in the 22800 block of Crespi Street in Woodland Hills, a south-of-Ventura Boulevard property valued last May at $855,000….
The foreclosed home was listed for $329,000 and Shih put his bid in the first day he saw the 1,185-square-foot, three-bedroom, two-bath house. By day’s end, there were seven offers on the table”
Small starter-sized reo right off the 101 fwy. Any property within a block of any busy Scal fwy is usually marginal territory. One positive: It is at the far western edge of the valley but not up in the hills so there are many if’s. Probably should have waited and held out for a much larger house but maybe that area might be prime, as are most areas south of ventura blvd in the SF Valley.
This will further undercut many Fb’ers as the SFV is in a massive Re downward spiral. By end of 2008 there will be ton’s of valley properties, even in prime areas , under $300,000.
Have to say he overpaid. Kudos to him for getting such a terrific discount, but we are talking about a 1,200 sq ft 3/2 starter home here.
The area south of Ventura Blvd. in Woodland Hills is the more desirable part of town, but this is a generic starter tract house.
The thing about Woodland HIlls is that it has an ENORMOUS number of 10-20 yr old McMansions, currently listed for $1.5-$2mm. It’s not a rich area, nor particularly beautiful, and these prices are clearly unsustainable. The downward pressure from the McMansions will make this small starter home look pretty unattractive by comparison.
I’m very familiar with this area of Woodland Hills. It is very close to Calabassas and what would be considered a very decent area. Wow! we haven’t seen these kind of prices for a long time . Maybe my buying a house in Woodland Hills for 300k or hopefully less in a year or 2 will be do-able. Of course I want newer and more sq footage but this is a start in the right direction.
As a side note my neighbor who is not a realtor but helps a guy who has several of his flips for sale sat in an open house today. All afternoon in Tarzana in a house south of the boulevard he’s trying to sell for $740 (she said way overpriced) and not one looker.
‘The qualifying guidelines are onerous (i.e., income, credit and equity) and the rates are up toward 7 percent. Who’s that going to help? Not many people.’
Mortgage Broker Definitions:
Onerous Home Loan Terms - Small downpayment, good credit history, and documented capacity to service the debt.
Fair Loan Terms - Cash-back at closing, no credit check, and a loan amount that far exceeds the borrower’s capacity to service.
Those “fair loans” are what caused the bubble in the first place!
“‘I have a pipeline filled with people who can’t (refinance) because these … jumbo lights are useless,’ Marc Savoy, a mortgage broker with San Francisco Pacific Mortgage Consultants, wrote in an e-mail. ‘The qualifying guidelines are onerous (i.e., income, credit and equity) and the rates are up toward 7 percent. Who’s that going to help? Not many people.’”
BWAHAHAHAHAHA!!! Gosh, we didn’t see that coming did we? What else can possibly happen when banks finally wise up and realize all those crazy loans they made the last few years aren’t worth the paper they’re printed on? Geez, the entitlement mentality runs deep in this country.
Rob
I love Savoy’s comment about the qualifying guidelines being onerous. He’s actually shocked that people have to have income, credit and equity.
‘The qualifying guidelines are onerous (i.e., income, credit and equity).
What the F***? Making sure someone can actually pay back the loan is onerous?
You don’t know how much schadenfreude I’m getting from hearing the screams from the un-credit worthy as they complain about mortgages going back to traditional guidelines.
This is easily going to be the greatest drop in home prices since the great depression.
My 25% down payment prediction might have been too optimistic. We’re seeing evidence that even FHA backed loans are needing more backing in order to sell the Mortgage backed securities.
Interesting times ahead…
Got Popcorn?
Neil
Right now, they want 20% down on the “true worth” + any loss between now and then so much larger.
Eventually, I still think we’re going back to 5:1 leverage (20% down.)
I wouldn’t be surprised to see 40-50% down in severely distressed markets or even a suspension of lendings till house prices bottom out and rebound.
Got cash?
The 40%-50% requirement seems possible. The “suspension of lendings till … rebound” does not seem possible, because it’s hard to imagine that a lender would not be willing to lend the fair capital equivalent of the rent. I have had some people come to me for loans where the LTV was going to be less than 50%. Why would I say no to these propositions? I guess if the whole economy becomes completely disrupted a la GD, rents could decline very quickly, but this circumstance is one I think the Fed can avert.
Yeah but rents drop also as the economy drops. We have had quite a bubble in rents also although its not talked about all that much its just in the last few years that rental properties where not a good investment.
50% LTV in non bubble areas is probably safe. But I see no real reason why rents can’t drop by 50% across most of America if not more.
As the economy founders no reason that we can’t see households often reduced to one steady income not two so a effective 50% haircut in purchasing power for rents homes etc. So for the big bubble areas that about a 75% reduction in both rents and home prices. For the rest about 50%. If you consider the impact of churn i.e as people are out of work for months get a job that pays much lower then lose it six months later it could even be lower.
So sure your right there is a bottom but its a looong way down.
Every buyer fancies himself as being a big time operator, and thinks that the price plummet will stop on the day that he buys.
“only in 21st Century Northern California”
No, you see it’s about the COMPASSION. We WANT people in THEIR homes for the sake of friggen humanity!!!
–
“Day and his family are on foreclosure’s doorstep, struggling to make mortgage payments totaling $6,240 a month. ‘I haven’t slept in five months. I wake up every morning in a cold sweat. I’m getting ready to go into bankruptcy,’ he said. ‘There is no money for food, basically.’”
“Day, a record producer who lives in Granada Hills, is upset that his lenders won’t modify the mortgages on either his residence or investment property. So far, all the assistance plans exclude speculators.”
Good thing that I moved away from these sobs (Chatsworth, next to GH), or SOBs. SF Valley was big time in bubble & speculative activity. People had forgotten the lessons 1990s.
Jas
Looks like there is some resistance to Gingle Mail….
See: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/04/13/RE34101D2M.DTL&tsp=1
The threat is that Fanny will not give you one of their mortgages for 5 years and you’ll need 10% down. Big deal.
There may be no Chinook Salmon in California rivers, but there’s plenty of Red Herrings around…
No - the Fanny and Freddie letter had a much better threat - mail back the keys without working things out, and the IRS may treat the unpaid debt as income, rather than treating it as forgiven debt that’s not taxed.
Now that would be a powerfull clout against Jingling. For a Cali mortgage, it would be permanent IRS jail. The Debtors prison returns without the bars.
I would love to see phantom income taxed. Those FB’s need to learn an expensive lesson instead of getting away free with nothing more than a ding to their already bad credit rating.
They will have the biggest bad-a$$es in the world chasing after them. That is the IRS. Those boys don’t back down to anybody. If Al Capone couldn’t escape the IRS I don’t think Freddy Foreclosure and Hillary Heloc will be able to shake them. This is the part that has real teeth.
IRS has better fruit to pick. Everyone who wrote off 100% interest on HELOC’s but did not spend 100% on improvements.
Easy to prove who did or didn’t. Did you save all your Home Depot receipts????? I did. And jet skies, hummers and vacations don’t count as home improvements.
It leaves out a few details of the actual rules the IRS uses. In some cases forgiveness can be triggered by having liabilities in excess of assets.(See Mish’s today)
And the 5 year ban is an empty threat. Anyone hear believe that marginal credit risks can manage to buy any sooner in this economy? They’ll be lucky to wait only 5 years to try again. Downpayments when assets values are falling and expenses are rising???? Don’t think that will happen.
“Bill Boze, a Realtor with Prudential California’s Montclair office, said he sees the impact of the mortgage crunch every day. Boze said he represented a well-qualified couple buying a Montclair home for more than $1 million and making a 20 percent down payment - usually considered the gold standard.”
“At the last minute, the lender said that all of Oakland is now considered a ‘declining market’ where home values are sinking, and required that the couple put down 25 percent. They were able to do it, but it doesn’t bode well for future deals.”
That pretty much sums it up. You can’t get a loan unless you have good credit, cash flow, and a big down payment. And in some cases, the down payment has to be 25%. Under this environment you can expect foreclosures to rise. No one is getting a refi loan.
I think we can expect prices to drop back to 1998 levels, probably even less.
Based on that San Anselmo post above, that’s quite the drop.
Those FBs who plan to rent their property out until this thing “blows over” have another thing coming. Good tenants are hard to come by during a recession; in addition to many good tenants falling from that classification. The eviction I witnessed this week reminded me of one from the last recession. The “eviction squad” set a former tenants property on the sidewalk in front of the house. Late that night the former tenant came back and set his belongings on fire. We had to call the fire department as some cars caught fire too.
Be advised.
Spook
This is my only concern about buying a foreclosure. The bitter previous owners who were foreclosed upon in a rare instance may say, “Heck, if we can’t live in the house, no one will.” And set it on fire after we move in.
Eviction is anti-human rights. Squatters rule!
I have a friend moving from San Diego who is planning to do just that. He’s house hunting and is planning to rent his SD house until things come back. I’m trying to convince him to rent instead of buy, at least for 6 months but I’m about to give up.
Gotta buy a house before the move, it’s the grown up, responsible thing to do, after all. /sarcasm
Rent from a cash-flow positive owner, or else you’ll be thrown out with the foreclosure. Unless the good bleeding hearts of California assembly suddenly find Jebus and realize tenants have rights, too. Right now the golden calf of homeownership needs its polishing.
If people are absolutely determined to pitch themselves over the cliff, at some point the best thing to do is to stand the heck out of the way.
I did have the chance the other day to help educate someone who was looking to buy their first house soon in the DC area. I emailed them what I picked up here about how to evaluate house prices. I also mailed links to the super scary case-shiller house price charts, along with one comparing US and Japan housing prices for good measure. I’m not particularly close to this person, but they were open to the idea that it’s not the best time to buy. Hopefully they are open to renting enough to do the (still) no brainer math that it’s cheaper to rent right now.
It’s sad when the lemmings dive over the cliff that they drag the rest of us down with them. Thankfully, I’ve got a parachute called “being debt free”…at least once my student loans are paid off.
I could pay them off today if I wanted, but it would eat up all of my cash.
The day I paid off my student loans we became completely debt free. That night I nearly had to make a visit to the E.R. because I had one of those 4 hour erections you hear about on TV commercials.
The day I paid off my student loans we became completely debt free. That night I nearly had to make a visit to the E.R. because I had one of those 4 hour erections you hear about on TV commercials.
LOL!!
Thanks to a savvy investment into a house right before the major part of the run up (Read as: We had no clue what we were doing and totally lucked out), we paid off the last of our student loans last summer after selling our house. The housing bubble wiped out the education bubble in our household.
RE: Late that night the former tenant came back and set his belongings on fire.
We haven’t even begun to see the hard core psychos of this quality-of-life meltdown.
Wait until the next dispossessed guy comes back with an AK and a drum clip full of tracer rounds.
Got your flak jacket handy?
Ahhhhh,
Lock and load your weapons. Brings back memories of going to the firing range at night and watching the tracers go flying through the air.
–
“In fact, they can easily qualify for one of the new ‘jumbo light’ loans - but they’re being quoted interest rates at a pricey 7.5 to 8.5 percent.”
Bank is NOT charging enough for the risk of default because the home might be wroth only $500K in two years.
“‘What that tells me is (banks) just don’t want to lend,’ she said. ‘(The new conforming limits) are having absolutely no effect whatsoever. $417,00 is still the conforming loan limit. It’s a travesty.’”
No, banks don’t want to lose too much more than they already have. Even with these tight statndards banks making loans today will lose more money.
It all depends upon your view of the future, miss. Yours’ is foggy at best.
Jas
“No, banks don’t want to lose too much more than they already have.”
So they might face a few $10 bns more in write downs — what’s the big deal, given the magnitude of losses which have already occurred?
What he is saying is NOT correct. The ‘new’ conforming limits have definitely brought down rates, but only in select areas. I shopped recently (making some lowballs), and was quoted 6.375 from Countrywide for a 729K loan, but this was for a ‘good’ LA suburb. For outlying areas, the rate would be substantially higher. Risk mgmt from the lender — they are expecting some zip codes to fare better than others.
Mortgage rates today, while finally tightening, do not reflect the risk involved at all. I’d love to hear an argument on why any FB should get access to a mortgage with a rate lower than his/her worst credit card.
–
I wouldn’t make mortgage loans for more than 60% of the conservative market value, but banks have a problem — should they stop lending until the market settles down? When you are playing with someone else’s money the decision doesn’t need much deliberation. If you are in the business of lending what do you do until it is not prudent to lend? Lots of conflicts of interests.
Jas
I get ya, Jas. The banks have to chase this one down. I just hope all the bank shareholders realize that too!
Check Drudge, he has 2 articles on the the banks writing down more tomorrow ! It may just be another down day ya think?
Nikkei is down almost 4% just now…should be interesting…
“Shih recently paid $336,500 in cash for a house in the 22800 block of Crespi Street in Woodland Hills, a south-of-Ventura Boulevard property valued last May at $855,000.”
Wow — the comps are really screwed up now. We are talking about a discount off the bubble peak price to the tune of
(336,500-855,000)/855,000*100 = 60.6 pct. Of course, one needs to have $336,500 cash in hand to make such an offer.
If you look at the map it’s maybe fifty yards from the dirty, noisy 101 freeway. Not exactly a desirable location.
That answered my question from above. Still way too much for the house - he’s a knife catcher who paid cash.
He`s a big time operator.
“If you look at the map it’s maybe fifty yards from the dirty, noisy 101 freeway. Not exactly a desirable location”
Also a small 1200 sq ft starter sized home. If it came with a large 6000 sq ft lot it may be ok deal but being so close to the 101 usually means marginal terrtory for homes unless there are 40 ft high hedges or retention walls .
There is a wall on the frrway and the 800 block appears to be further from the freeway. Probably has at least 6000 sq foot lot as most of the starter homes in that area have approx that.
That calc also assumes that the $855K price was ligit and not someone operating one of those “cash-back” scams. So many scams in the SFV.
“Ever since word leaked that Congress would redefine conforming loans in high-cost areas to go as high as $729,750, brokers were salivating at the idea of a potential gold mine of homeowners rushing to refinance. They hoped the new ‘conforming jumbos’ or ‘jumbo lights’ - loans between the old $417,000 limit and the new $729,750 cap - would carry favorable interest rates.”
Too bad prices are headed the opposite direction. So much for the failed theory that you can prop up home prices by raising the conforming loan limit.
Premature Overpayer…
Yet another personal anecdote.
Was chatting with my ex-husband last week (we are going to be grandparents and we were congratulating each other!) and somehow the conversation moved to housing. He informed me that his long time college buddy who bought around 2005 (I knew it was a mistake when he signed the papers), is in big trouble. This was a no money down, voodoo mortgage that recently reset….payment went from around $1,700 to $3,600…he has not made a payment in months. At the time that he bought the house (Oakland…not sure of the exact location), he was scraping along THEN! And as a special ed school teacher, there is no way that he can make the $3,600 each month. Even if he were to pull together money to pay for one month’s mortgage, he’s still staring the next month in the face. Needless to say, he is stressing BIG time.
I told my ex that I was not at all surprised. Yes, sad that he is in such dire straits, but not at all surprised. I also reminded him that if our friend is going to be looking for a rental, he’d better get a move on it before his credit record shows the default/foreclosure status on his record, as many landlords check credit and consider potential tenants based on their reports.
Another one bites the dust….
BayQT~
QT~
I mentioned about a friend of a friend who moved back to Dana Point from OK on super bowl sunday. She, her daughter and mother are still living in a motel in S jaun capistrano. I hate doing the math on that one, but it seems that her credit and her mother’s credit is bad.
I worry about the little doggie, but the daughter is enrolled in DP high school so all is well.
I used to wrestle Dana Point HS back in the old days. I went to SCHS and the average price of a house in the area was about $38,000 for a nice little 3/1.5 in a good area.
But Jwhite you said you live near Minneapolis. What town? The whole Twin Cities is screwed from what I’m seeing and hearing. I got a ton of local FB stories yesterday.
Some of these little dogie’s home will be in a Hormel can …after this slaughter
head um up…Move them out
Haha charade he is. I laugh in the face of all FBs. Degenerates!
On the bright side, he lost nothing but a couple hundred points on the credit rating. He put nothing down and will walk away clean. Tell him that and it’s not bad, lots of people are walking away. He will be able to buy a house cheap in several years.
True. But he’s my age (56/57). If I were him, I wouldn’t sign up for a 30 yr mortgage at age 60+. He’s had his chance. He’s enjoyed the house for 3 yrs. That’s all he gets, I’m afraid. Back to being a renter he goes. He’s definitely going to have very ambivalent feelings.1) relief that it’s over (after he walks); 2) that he failed. Since he will be able to breathe more easily, the relief will overcome the failure part.
BayQT~
Oh my, aren’t these FBs screaming like stuck pigs? Ha ha charade you are.
“Sky Hoffman and Carrie Locklyn (are) the new owners of a 1,400-square-foot, three-bedroom, two-bath bungalow in Van Nuys, not far from their apartment. Their Realtor, Steve N. Smallson, said they had great credit and a 10 percent down payment so they breezed through the qualification process for a 30-year, fixed-rate mortgage.”
“The house, a foreclosure, was bought in 2006 for $679,000 and Hoffman and Locklyn paid $420,000, or 38.1 percent less than the previous owner.”
“The former owners were evicted and the house was full of their belongings. Squatters had moved in and the copper plumbing and three window air conditioners had been stolen. ‘I call this the Disneyland house,’ Hoffman said. ‘Everything is Mickey Mouse.’”
_________________________________________________________
Buying a fixer-upper in scary Van Nuys for $420k?
Priceless…
Van Nuys wasn’t so bad. Anyone here old enough to remember the Busch Gardens theme park?
Thirty years ago, back when there was still a middle class, young people from all over the country moved to Van Nuys. There were tons of jobs available for every level of skill and education.
Workers who made today’s equivalent of $60K could easily afford a nice house, and what kind of bum was irresponsible to the point where his wife had to work?
Now, let me get this straight, someone paid $420K for a house in Van Nuys that had its copper stripped and window air conditioners stolen (implying no central air)? Even if the old GM plant rises from the dead, these FB’s will still lose their shirts!
I remember the Busch Gardens. My parents took us one year in the early 70s to Disneyland, Knotts Berry Farm and the Busch Gardens. After a hot day, I just remember how cool and green Busch Gardens was.
Thanks for the memory. I couldn’t remember the location of Busch Gardens.
“The house, a foreclosure, was bought in 2006 for $679,000 and Hoffman and Locklyn paid $420,000, or 38.1 percent less than the previous owner……..The former owners were evicted and the house was full of their belongings. Squatters had moved in and the copper plumbing and three window air conditioners had been stolen.”
They payed $420,000 in van nuys for a badly damage fixer REO with copper plumbing & 3 room AC’s stolen ?. Who know how much more damage and looting done by squatters? They payed $200,000 too much. It will take at least $5000.00 just to repair/replace the missing plumbing fixtures and that is a very cheap estimate.
Van nuys is a large somewhat gritty lower- working class dull as nails community with lots of sweatshop factories. Though there may be a few isolated quiet clean middle- class streets here and there, 80% of the city is officially a declining former middle class hood rapidly degentrifying into lower class marginal hood. This is for both East and West Van Nuys, divided by the 405. Plus it gets really hot like 100% in summer , and the air is always hazy & yellow-tinted.
Nobody ever writes about van nuys because it is a large pancake-flat sooty lackluster grey zone of the SFV not worth even mentioning.
The best & only notable landmark in van nuys might be the Anheiser-Busch beer plant.
They payed $420,000 in van nuys for a badly damage fixer REO with copper plumbing & 3 room AC’s stolen ?. Who know how much more damage and looting done by squatters? They payed $200,000 too much. It will take at least $5000.00 just to repair/replace the missing plumbing fixtures and that is a very cheap estimate. Van nuys is a large somewhat gritty lower- working class dull as nails community with lots of sweatshop factories. Though there may be a few isolated quiet clean middle- class streets here and there, 80% of the city is officially a declining former middle class hood rapidly degentrifying into lower class marginal hood. This is for both East and West Van Nuys, divided by the 405. Plus it gets really hot like 100% in summer , and the air is always hazy & yellow-tinted.”
Agree. When I moved to Los Angeles in the mid 90’s and was looking to rent a room, one of the places was in a home in Van Nuys. It was a nice place on a cul-de-sac. But it was surrounded by the hood. You might be fine once you got home, but I wouldn’t want my car to break down at night going to or from one of those nicer pockets. There was one L.A. radio station that once had the following promo: “Van Nuys, home to the porn industry and our transmitter.” Maybe they can rent the house out as a set.
It’s weird that normal, reasonable lending standards such as good credit score, a down payment, and verified income is perceived as something harmful that needs to be fixed!
“‘We had no idea that this was the beginning of the end,’ he said of his attempt to cash in on a hot market that had chilled. ‘We got blindsided.’”
Blindseded? By a Financial Train on a Track blowing its whistle? I continue to be sickened by this ignorant statement. Financial Darwinism is a cruel teacher. Let them eat Top Ramen.
All these FBs were surprised to find out that at the end of the light there was a tunnel.
Who would have ever thought that stamp collecting would come back in vogue?
“Struggling with rising prices and a stalled economy, a growing number of Bay Area families are turning to food stamps. ‘More and more, the people the food stamp program is serving are people who are working, but simply aren’t earning enough money,’ explained Jessica Bartholow, food stamp outreach manager at the California Association of Food Banks.”
‘More and more, the people the food stamp program is serving are people who are working, but simply aren’t earning enough money,
The overly cynical part of brain thinks perhaps more than one of working people have found the money for cable TV, cigarettes, alcohol, and Wal-crap but, oopies, the money for actual food is gone.
I wonder how many people would accept help if they were told that under no circumstances could they pay for cable TV, high speed Internet connections, cigarettes, or alcohol while receiving food stamps. It’s a thought exercise, of course, as I don’t know how you’d enforce it. Still, it would be interesting to see how much the food line thinned…
“…but simply aren’t earning enough money…”
Can 300 million people be on food stamps?
“…but simply aren’t earning enough money…”
They forgot to finish the sentence. They forgot to add, “to continue to live the ridiculously high standard of living that their income level could never realistically support.” Somebody owes me a fee for consulting on this one.
Here, calm down, and just have a beer. I’ll even buy you one.
Thank you. I already had one. That’s it for the night. Last night was a little much and we finished it off with a meal in Chinatown. Need I say more?
“Day, a record producer who lives in Granada Hills, is upset that his lenders won’t modify the mortgages on either his residence or investment property. So far, all the assistance plans exclude speculators.”
This brings a phrase to mind. That phrase is, and I quote, “AAAAAAAAAaahahahhahahahahahahahahahaa woo hoo hahahahah aha aha ahaha ha ahaha a haaaaa; asshole.”
So very righteous.
What kind of trashy records does this struggler produce?
“Day and his family are on foreclosure’s doorstep, struggling to make mortgage payments totaling $6,240 a month. ‘I haven’t slept in five months. I wake up every morning in a cold sweat. I’m getting ready to go into bankruptcy,’ he said. ‘There is no money for food, basically.’”
Remember back around the Summer of 05, those smug pricks that sat around at dinner parties telling people how smart they were for investing in real estate, and self-assuredly informing everyone that real estate prices only go up? Dollars to donuts this asshole was one of those smug pricks.
I like your anger!
If Krispy Kreme teamed up with someone’s asshole to put sh*t in donuts, would you join in with them and eat them too?
righteous indignation…..love it, now fill up the tank and take the kids to Mcburger for a fine dining experience.
Funny and a little sad: this Elk Grove, CA Craigslist listing under “garage sales”-
YARD SALE/MOVING SALE— EVERYTHING MUST GO!
Bring your kids along to meet Elmo, Cookie Monster, Dora, Pooh, and / or Tigger and have your photo taken with them.
Refreshments available: Pastries, Chips, Candy, Sodas & Icees.
APRIL 13th, 2008
Some of the items for sale:
HUMMER
RECREATION VEHICLE
HOT TUB
BBQ
ELECTRONICS (TV’s, VCR’s, DVD players)
TOOLS
FISHING GEAR
JEWELRY
ANTIQUES
COLLECTIBLES
SPORTING GOODS
FURNITURE
HOUSEWARES
CLOTHING
MOVIES (dvd & vhs)
CDS
ART
CAMERAS
OUTDOOR FURNITURE
I MUST SELL SOME OR I LOOSE EVERYTHING.
9480 EAST PARK DRIVE, ELK GROVE, CA 95624
HWY 99 SOUTH
EXIT ELK GROVE BLVD, TURN EAST (LEFT)
TAKE ELK GROVE BLVD DOWN ABOUT 3 MILES (PAST A “ROUND-ABOUT”) AND EAST PARK IS ON THE LEFT.
SUNDAY APRIL 13TH, 2008 FROM 7AM (OR SO) TO 5pm.
ALL SALES ARE FINAL, CASH ONLY.
—————————–
Ah, FB, poor FB.
You Californians have all the fun! I hope someone went…and bid 50 cents per item.
I assume you’re including a hummer?
Stop it, Edgewater John, you`re killing me!
This home is creepily close to the McMansion my sister and her husband bought in 2004. Sis isn’t upside down, though. Just pissed off.
And she will keep getting more and more pissed off …
The flip side of reason is fury and fulmination as if we caused the bust. Wisdom is not rewarded either on the way up or the way down.
Oh well! Who wants popcorn and beer?
unlocking the value..
Ive been telling very close friends that the deals of the hungry upside down homeowners are gonna be a treasure trove of crap that you think you might want….they shoulda had some lumber, copper, and assorted fixtures in the ad as well, even if they didnt have any…..more trucks show up for that….and power tools, not just tools.
Guess who’s heading for a robbery on Sunday night………
‘You can tell how hungry for information people are from someone they feel they can trust,’ said Gabe del Rio, president of the nonprofit Housing Opportunities Collaborative.
This is the same Gabe del Rio who is busy helping low income families buy homes and back in November 11 of 2007 wrote in an email: “when a home has already de-valued by 40% or more, there isn’t much room to drop more, and if it does will be back up again in a handful of years.” I guess with FIVE years of experience in the real estate arena (and paid to get people into home debt) Gabe is the man to trust for honest and knowledgable real estate advice.
Gee Gabe, how are those San Diego home values holding up?
I don’t know who remembers the movie “Falling Down”… beggar walks up to Mike Douglas and asks for money for food. Says I haven’t had anything to eat for…. Mike Douglas stares him down as the guy realizes he is holding a sandwich.
“Day and his family are on foreclosure’s doorstep, struggling to make mortgage payments totaling $6,240 a month. ‘I haven’t slept in five months. I wake up every morning in a cold sweat. I’m getting ready to go into bankruptcy,’ he said. ‘There is no money for food, basically.’”
So, how could you wake up if you haven’t slept? Six gs… lots of money though… walk away
“…and the rich declared themselves poor…”
George Michael from “Praying for Time”
BTW, great lyrics for the present situation in this 1990 song.
Great call, Edgewaterjohn!
IAT
We didn’t really know what we were doing. They never explained about the loan, just: ‘You qualified; here’s your new home.’”
And they didn’t sit down and pencil down. I make $13/hr. That is $30K per yr. My spouse makes the same. That is $60K. We were told our payment was fixed 1% for 30 yrs at $2000/mo. Our purchase price is $850K. $2000×12=$24K per yr, x30 yr= $720K. That doesn’t even pay the principle. Not to mention interest, taxes, insurance, etc. Mr. Broker, am I missing something here?
I am glad to hear San Ramon is getting kicked in the A$$. That was my first home in the Bay area. One of the nicer places there, but now way too expensive and everyone (except me) thought they were Trump Jr.
It’s also a result of the housing market tanking in the fast-growing eastern Contra Costa cities of Pittsburg, Antioch and Brentwood. A four-bedroom, four-bath home with a pool on a golf course that sold for $890,000 in August 2005 just sold for $530,000, Kramer said.”
I had flyers from 1997 for this hellhole advertising these same types of houses for $70-80K. Which way is this going? And for those not familiar with out there, there is one freeway, Hwy 4. I could walk faster than most of those people make their 60 mile drive (one way) into Oakland or 75 miles to San Francisco.
Don’t forget the oil refineries are all out that way also.
Money for nothing, and the cancer’s for free?
I remember looking at the new paired homes (1998) in Antioch when they were $114k. Then they went up to $117k. Nope, didn’t buy anything. Didn’t want the long commute from Antioch to Emeryville. I shudder to think want they sold for in the run-up.
BayQT~
Mortgage Broker Definitions:
Onerous Home Loan Terms - Small downpayment, good credit history, and documented capacity to service the debt.
Fair Loan Terms - Cash-back at closing, no credit check, and a loan amount that far exceeds the borrower’s capacity to service.
3 years ago terms: Mr. Jones (Garcia, Yamamoto, Lee, Li, or any other generic name to represent the many ethnicities here), can you blow on this mirror. It is fogged now. Congratulations, here is your $1M loan. Your payment is over $1500 a month. Enjoy your new big home. In a year, it will be worth $2M. Don’t worry about all of that fine print. It isn’t important.
““‘This is probably the finest home we have in the Sky Sotheby’s inventory right now,’ Roffers told the crowd, saying the owner had previously turned down an offer for $4.3 million. Even so, the bidding only got started at $1 million, and despite Daniel DeCaro’s best efforts only managed to reach $2.3 million.””
Just goes to show even the upper class mansions aren’t “different” but itll take longer for prices to drop. A depression will do that. Rich people will see alot of their “old money” evaporate and sell their second and third houses to cut expenses and have cash to maintain their lifestyles. No new rich person is gonna pay crazy millions, they will just buy a smaller house for “only” one million which is enough for them.
Now that would be a powerfull clout against Jingling. For a Cali mortgage, it would be permanent IRS jail. The Debtors prison returns without the bars.
I truly hope they treat the unpaid debt as taxable income. To not do so is criminal action on part of the government. They received that money and chose to waste it on an overpriced house. I wish they really did go to an actual debtor’s prison. But there wouldn’t be enough of them. Of course, I have a good idea. Put up a tent out in the Mohave Desert (Death Valley locale) and pen em’ up there. Leaving the tent would be instant cooking. To H&!! with those bleeding heart liberals that would say we are violating their civil rights. These idiots violated ours by driving the prices beyond ridiculous, and now it is payback time.
““No dice; the answer was no. The auctioneer returned to the stage. ‘Folks, the reserve price on this is $8.2 million,’ he said.”
“The rustling continued for a few more moments, as the auction employees continued to work the crowd. ‘Get that guy’s wife back on the phone,’ DeCaro joked. ‘We’re not taking no for an answer.’”
“But it was not to be. Bidding was closed at $5.92 million.””
This used to have a $15m list price and a $9m offer that fell thru. Anyone who pays millions for “rich” property is catching a 20 foot long knife. I see listings for intracoastal and oceanfront property for $5m to $25m. No way is the land worth several millions.
This is all good news, as these socialist Clownifornians deserve to suffer.
How is this socialist? These people screwed themselves by pursuing the free (i.e. unregulated) mortgage market.
Here, here. As a former Clownifornian, I love to hear the greedy pigs squeal. As for the record producing idiot who was blindsided, we can’t just blame him. The steroids pumped up leader was also blindsided, since he said so in some speech in Fresnohell.
“‘The mortgage market has been locked up since last August and is still as locked up today as it was Sept. 1, if not worse,’ said Guy Cecala, publisher of Inside Mortgage Finance. ‘This is clearly the worst mortgage market environment we’ve seen since the Depression.’”
Yeah, it’s so much worse than the double digit interest rates just 25 years ago. Moron.
On a similar vein, saw one of my clients a few weeks ago who’s been in real estate 35 yrs. Asked him how things were, and he was quite matter of fact–said he’d been in it long enough to know the good times of the last 10 yrs or so would go away, he stashed the windfall away and he’s doing fine.
Hopefully this whole experience we’re going through right now will be a good lesson for everyone that will last more than a few years…
The “Mortgage Relief” article in the SF Chronicle was huge…top of the front page on Sunday. When the GSE limits were raised, the same writer wrote quite the cheerleading piece that this would be the savior of the Bay Area housing market, which of course it hasn’t.
And that quote about this being the worst mortgage market since The Depression, I just laughed. Anyone who bought in the mid ’90’s or earlier remembers down payments, tax returns, stable income, no credit card debt, six months cash in the bank, etc.
This hasn’t been a real RE Market…it’s the long lost scene from the 1973 classic Paul Newman movie the “The Sting”
Global warming alert: Saskatoon reached 76 degrees on April 13! Other cities in that part of Canada along 49-53 degree latitude reached temperatures exceeding 70 degrees! Normal temperatures for this time of the year is 40 to 50 degrees!
Yellowknife in NWT reached a high of 51! Normal temperatures are 20-30! latitude is 62.5 degrees.
Four days ago, two feet of snow in Minneapolis.
What exactly is wrong with warm temperatures?
The Press Telegram. “Many real estate agents insist this is a great time to buy a house because so many foreclosed properties are on the market. But two years from now there might be even better deals, at least in Southern California, where the foreclosure situation is going to worsen.”
I’m surprised this quote wasn’t noted.
This is true of so many markets. Those that don’t drop will via ‘diffusion’ lose value.
Got Popcorn?
Neil
I see 80% drop in values before hitting “rock bottom”.
Well 75-80% in the best areas. Which might not be the best ones today. In a lot of areas housing will be negative since once good farmland is now marginal. The asphalt from the street will be worth more then the houses if they have been stripped of copper and aluminum.
A lot of people don’t realize that reclaiming land with abandoned houses costs money.
“Thousands have flooded county tax assessors’ offices in recent weeks in an attempt to lower their taxes, officials say. The trend is particularly evident in the East Bay and in Santa Clara County, which have pockets of some of the steepest declines in home values.”
I can’t wait until the tax bills are mailed here in Las Vegas (I rent). Because our annual property tax increases were capped at 3 percent starting in 2006, most of the assessments have yet to catch up with the boom times. So even though values are plummeting now, most people are going to see a 3 percent increase this year and probably for the foreseeable future just to catch up to the previous price pump.
With median prices in Las Vegas down 19.5 percent year over year, there are going to be plenty of pissed off people. “But the value of my house dropped 20 percent and my taxes are going up? I want to appeal.”
Dear Fries with That:
I remember Busch Gardens we used sneak in the theme park over the wall when we were kids. I will never forget when the security guard caught my little brother by the back of his shirt. But somehow he escaped and we ran all the way home. Only to return the next day for another try at getting into the park free. Busch Gardens and the free hot dogs at Galpin Ford were the highlights of my young life.
I remember the place, too. Used to take my oldest there in the early 70s. Would go mid afternoon and stay into the evening. Free beer and cool rides and places to hang out.