And The Snowball Continues
The Rocky Mountain News reports from Colorado. “The 2007 Parade of Homes, which featured five display homes in the $2 million range in Southshore near Aurora Reservoir, illustrates the plight of the struggling, upper-end market in the suburbs. More than six months after the end of the parade on Labor Day, none of the five homes has sold. One is in foreclosure. Another is expected to end up there after its builder dissolved his construction company.”
“On April 7, Remarc Homes put its 7,200-square-foot home called Celebrations into foreclosure, according to public records. ‘I’m not sure I want to be advertising to the public right now’ that the home is in the initial stages of foreclosure, said Debbie Cramer, an owner of Remarc.”
“The home, which features a ‘woman’s getaway space - a place for solitude, renaissance and peace,’ according to advertisement literature, is on the market for $1.825 million. ‘I think the land was a little overpriced,’ Cramer said. ‘We all had appraisals that said it could support homes of over $2 million.’”
“Wayde Jester, consulting director for Metrostudy, said the problem ‘may be one of simple supply and demand. There’s been a lot of building out there. If someone wants to invest $2 million in a home, it might not be southeast Aurora for most people.’”
“‘Sometimes builders’ egos get caught up in the parade home, and they get carried away,’ he said.”
“Byron Koste, director of the CU Real Estate Center, agreed. ‘Quite often in a parade, a builder wants to make a statement, and they’re inclined to overbuild for that specific neighborhood. If home prices keep going up, that’s usually not too bad. But when prices are moving in the other direction, the difference is magnified.’”
“‘Unfortunately, in difficult times like these, people can’t afford excesses,’ Koste added. ‘And some of these homes might be what you would consider to be excessive.’”
From Real Vail in Colorado. “The Vail Board of Realtors characterizes 2008 as being off to a ‘leisurely start.’”
“Other observers say Eagle County’s formerly white-hot real estate market has been deteriorating for nearly a year now – and that seemingly bubble-proof mountain home sales are finally feeling the impact of the national housing-market downturn.”
“The numbers don’t lie. January saw the number of transactions dip to 104 in Eagle County, home to Vail and Beaver Creek ski areas. This is the lowest January figure in 12 years. February improved slightly to 131 transactions, but that’s still the lowest number of deals since 115 in February of 2003.”
“In Pitkin County, home to Aspen, sales volume has been off considerably more than Eagle County to start 2008. January sales totaled $127,200,000, off nearly 50 percent from the $253,209,000 sold in January 2007. February sales totaled $131,485,000, compared to $192,612,000 in February 2007, a decrease of nearly 32 percent.”
“‘Everybody was really optimistic coming up on the end of ‘07, thinking maybe we were going to sneak through and not have the impacts here,’ said real estate broker and former Vail mayor Rob Ford. ‘Now here we are and everyone’s saying, ‘Oops, maybe we are going to be affected,’ but no one seems to know how deep it’s going to go.’”
From ABC 15 News in Arizona. “Despite recent news that home sales increased in the month of February, experts say it is not an excellent indicator of what’s to come.”
“‘The question is, ‘What is normal,’ Jay Butler, the director of Realty Studies at Arizona State University, told ABC 15. ‘A normal resale market for a year would be about 70,000 transactions. We’re probably not looking at that this year. Maybe some glimmers of recovery this year. Maybe 2009 we’ll approach it. Maybe 2010.’”
“Jamie and David Standage say they’re trying to patient when it comes to selling their Tempe home. They’ve had their remodeled house on the market for eight months, but no one has made an offer.”
“‘I don’t know whether people think now is not the time to buy, or what it is,’ said David Standage.”
“‘We just keep hearing that it’s not getting any better and that it’s not going to get better,’ said Jamie Standage.”
“The couple recently reduced their home price by $30,000 in hopes someone will take a second look at their house and make an offer. ‘We’ve done quite a bit of work on this, and I just feel like when the right person walks through here, they’re going to say, ‘Okay, that’s the house I want,’ David Standage said.”
The Arizona Republic. “Residents in an upscale neighborhood in Gilbert finally saw a clean-up earlier this week that they’ve been waiting for since October. Weeds at a vacant house in The Grove in the Millett Ranch subdivision had become an eyesore, resident Joanna Turpin said.”
“‘Nobody in the area has a house for sale,’ Turpin said, ‘but we were just embarrassed to have people over. Even the guy who cleans up our yard asked what was going on in the house across the street.’”
“‘Got Weeds?’ is a question often asked of Johnson Ranch residents after their homeowners association began its neighborhood maintenance program last year. Some associations are setting aside money to help maintain the yards of houses facing foreclosures, said Cynthia Dunham, executive director of The Leadership Centre.”
“‘We’re just beginning to see the ramifications of this,’ Dunham said. She said she expects Gilbert’s outlying areas with newer developments to be hit the hardest with foreclosures because those often contain investor properties. Dunham said more associations also are seeing their residents fall behind on assessments because of financial hardship.”
“‘With the market as bad enough as it is, you want to have the allusion that you have a nice neighborhood,’ Turpin said, who added people she’s talked to throughout the Valley say their neighborhoods have foreclosed properties that aren’t being maintained.”
“‘What kind of recourse do we have as neighbors?’ she asked. ‘Should it be up to us to clean it up? That doesn’t seem like it should be the case.’”
“Though Canadians account for only small part of the Valley’s total housing market, their interest is growing. Through mid-March of this year, 381 buyers from Canada invested in metro Phoenix homes.”
“Canadian investor Trevor Matheson has taken an interest in metro Phoenix’s real-estate market. So much so that he plans to buy six homes in the area over the next year.”
“‘There are definitely deals to be found in Phoenix,’ said Matheson, who plans to hold onto the properties for at least three to five years.”
“Matheson purchased his first Valley home in January…a house in north Phoenix’s Kierland area that sold for $785,000 in 2006. The owners were facing foreclosure, and Matheson got it through a short sale for $470,000.”
“Matheson is looking to sell six homes in Edmonton, Alberta, to buy homes here.”
The Review Journal from Nevada. “Most foreclosed homes in the Las Vegas Valley are concentrated in newer subdivisions and have average home ages of less than 10 years, a local housing market analyst shows.”
“The average age of homes in the top 10 foreclosure ZIP codes in Clark County ranged from 4.5 years in 89148 (537 foreclosures) to 25.1 years in 89108 (395 foreclosures). The median was eight years.”
“‘I think that was where the amateur investors and flippers were going because they could get a loan there,’ SalesTraq President Larry Murphy said. ‘I can get a new home and it’s easier to get a loan. Don’t get me wrong. It happened in older areas too, but people flocked to sales offices in 2004 and 2005, they got their houses delivered in 2006 and in 2007 they basically gave it back to the bank.’”
“The rise in ‘mortgage walkers’ is a new phenomenon for Las Vegas, Realtor Steve Hawks of ReMax Platinum said.”
“Home prices have dropped to 2004 levels, so most homeowners who bought into communities built after 2005 are going to owe more than their house is worth, he said. ‘When they try to sell for whatever reason, they either have to do a short sale or get foreclosed on. In addition, many investors purchased in these new areas and now are so upside-down they don’t see the break-even point,’ Hawks said.”
“‘Meanwhile, they’re paying on a loan that’s probably going to adjust, or even if it’s fixed, they can’t get the rent to cover the mortgage when their new neighbor just purchased the same house for $220,000 when they paid over $420,000. The person who bought for $220,000 can rent it out for far less, obviously, and the snowball continues,’ he said.”
“Home ownership in Las Vegas has become more affordable under current market conditions, with the median resale price dropping 19 percent from a year ago to $235,000. But they’re being denied that opportunity, said Cory Frey, senior loan officer for Southern Fidelity Mortgage, because they can no longer use so-called stated income loans, or loans based on income other than reported wages.”
“Before Assembly Bill 440 was enacted last year, Nevada law required lenders to ensure that borrowers could repay their loans before issuing a mortgage.”
“The bill amended the law to make it unfair for a lender to ‘knowingly or intentionally make a home loan, other than a reverse mortgage, to a borrower including, without limitation, a low-document home loan, no-document home loan or stated-document home loan, without determining, using any commercially reasonable means or mechanism, that the borrower has the ability to repay the home loan.’”
“Bankers look at loans in foreclosure and see that a majority of them are either stated income or adjustable rate, said Ed Jamison, chairman of Community Bank of Nevada. It’s an unfortunate dilemma because people got money they probably shouldn’t have, but the product was available, he said.”
“‘It’s always been a nod and a wink with certain segments of our economy on what they make,’ Jamison said. ‘Candidly, that segment has dried up because of the risk factor. Bankers are pretty dumb, but when you get hit in the head several times, you say, ‘OK, that’s not a good product.’”
“Luxury high-rise condo resales increased to 29 units in the first quarter from 24 in fourth quarter 2007, Las Vegas-based Restrepo Consulting Group reported. The number is up from 27 in the same quarter a year ago.”
“There were 523 high-rise condo listings as of March 31 at a median price of $749,900, or $482 a square foot. Three major projects were completed during the quarter. The $250 million, 40-story Allure tower on Sahara Avenue brought 428 high-rise luxury condos onto the market.”
“The high-rise condo market continues to show signs of weakness, Restrepo Consulting project director Elena Shampaner said. ‘This comes as no surprise considering the current housing recession, as well as the national credit crunch,’ Shampaner said.”
“The $420 million, 49-story Palms Place on Flamingo Road added 599 condo-hotel units; and the $1 billion, 64-story Trump Tower on the Strip added 1,282 condo-hotel units.”
“For the condo-hotel segment, 11 units were sold at a median price of $395,000.”
“No mid-rise luxury condos were resold during the quarter, Restrepo Consulting reported. The firm showed 132 mid-rise listings at a median price of $636,950.”
In Business Las Vegas from Nevada. “It is the classic tale of boom and bust in Las Vegas. Investors of apartment buildings saw an opportunity and went on a buying spree to obtain complexes, upgrade the units and sell them as condo conversions at a hefty profit.”
“The market took off with nearly 8,000 units closing in 2005 when investors were in a frenzy, according to Home Builders Research. By 2007, the number of closings dropped to 1,612, and the condo conversion market today has virtually ground to a halt.”
“Many major investors see what has happened to those who bought complexes to convert into condos, only to see them sell one-third or half of the units and rent out the rest as apartments, said Gary Cuff, senior director of multifamily investments with Cushman Wakefield Commerce CRG in Las Vegas.”
“‘The ones that can are hanging on, and the ones that can’t are going to be swallowed up by the sharks who will come in and buy these properties for deep discounts and hold them, rent them as apartments until such time they can take them to market,’ he said.”
“With the decline in home prices, first-time buyers would rather spend $150,000 for a small home in a good neighborhood with a back yard than the same prices for a converted apartment, Las Vegas housing analyst Steve Bottfeld said.”
“The median price of condo conversions in 2007 was $180,000. That’s down from $197,140 in 2006 when the market slowed.”
“‘The one thing you have to do to have success in condo conversions today is not sell them to investors,’ said Bottfeld. ‘Because as soon as there is a perception that you are buying into an apartment, you have lost the entire panache. The whole idea behind conversions is the first-time home buyer.’”
“‘The greed meter got going for a lot of people, and they thought they would get in on it,’ Cuff said. ‘Some did well, but those who got in late were left holding the proverbial bag when the market slowed down.’”
The Nevada Appeal. “Developers fought to get one of the city’s largest subdivisions approved more than two years ago, but not one room at the Shulz Ranch has been built. Work on the 521-home development in South Carson City might not start any time soon either.”
“Shulz Ranch Developers, managed by Lennar Communities in Reno, defaulted on a $26 million loan on the property last month.”
“Work on subdivisions being developed by other companies has also been slow. More than half of the nearly 2,000 vacant home lots were approved by the city after the start of 2006. Home sales in the city last year were half of what they were in 2002, and the average home sale price rose more than $100,000 in that time.”
“The market, however, is getting better this year, at least for the 1,075-home Silver Oak subdivision, said Mark Turner, a sales agent for the developer. Prices for the homes have dropped about a third, he said, but the worst time for business was in the last two years. The company has about 475 lots left to sell.”
“The number of building permits for homes in the city dropped by more than half from 2006 to 2007. A slow down in home construction should not be a surprise with the country’s building and credit problems, though, said Bambi Spahr, director of the Reno-based Builders Association of Northern Nevada.”
“‘They’re not building ‘A Field of Dreams,’ she said.”
‘White hot’ in Colorado? But folks there keep saying there is no bubble. Yet I keep finding references to a boom period:
‘Colorado is one of the states worst hit by the mortgage crisis. Larimer County has not been hit as hard as other regions, but it has seen its fair share number of foreclosures.’
‘I think at this point we count our blessings,’ Larimer County Budget manager Bob Keister told Fort Collins Now. ‘County government is financed by taxes on real estate. Right now, and for the last 10 years, real estate has gone up. That means increased value times our tax rate, and that means we’ve been able to benefit. It allows us to continue paying people and giving them raises and offering services. But the big thing is property values are falling.’
Too bad Northern Colorado didn’t get the message soon enuf on Aurora’s 2007 bomb of a parade. They are planning their own in a couple of weeks:
http://www.greeleytrib.com/article/20080406/NEWS/159029096
Then, next year, the elves will visit
?
I’m trying to picture what a “Parade of Homes” in Greeley would entail. A bunch of double wides? Kidding aside, the only reason to live in Greeley is because its much cleaper than Loveland, Ft. Collins or Windsor. And for a good reason: no jobs, lots of illegals, lots of crime and of course that feedlot smell (not as bad as it used to be, but it still smells). When HP still had a campus in Greeley the majority of the staff commuted from Larimer County.
BTW, the average sales price in Greeley was 152K in February.
It has been white hot, an absurd amount of speculative building catering to Californians and east coast empty nesters. In Boulder there are no less than 500 spec condo units nearing completion that are all over $500,000, most in the $1,500,000 to $3,000,000 range. Same demographic as the mountains, the market slowed to a crawl after the beginning of the year. Median price for condos sold through February was $210,000, talk about a disconnect.
So much for the idea of Sell in California and move somewhere cheaper !
They don’t call Boulder the Berkeley of the Rockies for nothing. Just 10 miles down the road in Broomfield much nicer houses can be had for a fraction of the price.
‘White hot’ in Colorado? But folks there keep saying there is no bubble.
It was regional. The resort areas were hot, and so was Grand Junction. But the rest of the state was pretty flat these past 5 years. According to the Office of Federal Housing Oversight on average the state had a cumulative 17% of appreciation in the past 5 years, compared to the national average of 41%. And I must say this matches my on the ground experience.
In SW Colorado, house prices pretty much doubled over the last 5 years. The Durango area is way over-inflated.
Well, Durango is considered a resort area. Cortez rode on its coat-tails.
Colorado had their huge run up in the late 1990’s. Logically, prices should have FALLEN from 2001 to present, but the bubble propped up real estate values. Now that the bubble is deflating, the front range is finally seeing the fall in home prices that should have occured after the tech bubble collapsed.
People keep saying that, but all I saw in the late 90’s was about 25% total appreciation. My in-laws place in Broomfield has appreciated about 60% since 1990. That’s barely kept pace with inflation.
Any news on Breckenridge? How’s values holding up there?
My 1997 new construction (sold in 05) in northern Broomfield/Wesminster gained 60% in three years and was flat from then on. Perhaps the late 90s gains were concentrated in new construction?
‘County government is financed by taxes on real estate. Right now, and for the last 10 years, real estate has gone up
I’m paying the same property tax as I did in 1999! I don’t know what this guy is talking about. Even if our houses had doubled in value TABOR would have kept the property tax in check with inflation.
Woman’s getaway room???? LOL!!!!!!!!! That must be where you “entertain” Biff, the hunky personal trainer.
‘a place for solitude, renaissance and peace’
Renaissance?
The truly special homes also have reformation and counter-reformation rooms. You know, for after you’ve had your renaissance.
I want a renaissance with a little piece in my room.
I mean peace. I mean in my ‘womans’ room.
I mean give me some space. I mean give me ..
oh dang. I got all excited over $1.825 mill for a piece of room for my womaness. I mean Peace. oh never mind.
I was thinking piece
Leather codpiece?!?
I’m a vegan.
Fake leather then.
Pleather.
You’re a Vegan? How did you get here? Was it a rocketship or a teleporter?
Either way, welcome! We’d take you to our leaders but we’re too embarrassed.
Now don’t be a Frankfurter about it!
“Come indulge your womanly renaissa—-agh! shrieeeek!…. who you are you?!!! I didnt expect…..”
“NOBODY EXPECTS THE SPANISH INQUISITION!”
snort
You must be single, Ben, or don’t watch much Oprah. LOL
“a place for solitude, renaissance and peace”
At my place, that room is called “Dad’s bathroom”
“a place for solitude, renaissance and peace”
——————————————————
hell, just call it the al bundy room.
“dads bathroom” … hehe. nice
reminds me of the Malcom In The Middle episode where the parents finally got around to cleaning out a small storage room, only to discover, buried under boxes, a toilet …. and realizing the room was actually a bathroom!
The sheer ecstasy on their face was priceless, as was the ensuing attempt to keep the discovery from the kids. Took awhile but I eventually warmed up to that show. having kids helped.
always, always been an Al Bundy fan. should have been an omen when my ex would not even crack a smile as I was falling off the barcalounger in laughter. No prob; alls well that ends well.
My ex- HATED that show. I of course, loved it, especially the first few seasons with Steve and Marci.
I was really ROTFLMAO on one of the first episodes when Al was giving Steve the briefing on all the stuff that wasn’t going to happen anymore, now that he was married……..Al knew what he was talking about.
“a place for solitude, renaissance and peace
this sounds like a upscale …GRAVE
“Let’s Rock”
My favorite is when you and the Mrs. are at an open house and ask, “Oh what’s this room for” ( noticing it’s not a bed/bath/reading room? “Oh it’s a ‘wrapping room’”
Really? Pardon my lower-middle class upbringing but WTF is a ‘wrapping room’? Well, it seems it’s a place where proper ladies go to wrap presents! All I could think was that with the payments this monster is going to demand WhoTF is going to have any money left over for presents TO… wrap!?
I know Al wouldn’t stand for THAT!
MWC my favorite show of all time. I still watch the reruns at night.
What would you guys give to have a “Married with Children Housing Bubble Re-Union Show”!?
Total bubble-themed script complete with MEW-fueled shopping orgies and all the elation only to have it come crashing down around their ears and it ALL… goes back!
well daggummit, even txchick cant resist the urge to slum with us commoners watching slag TV.
of course it’s only late nite on the TV. and Bloomberg is in the picture-in-picture corner of the screen. blinds drawn. lights out. low volume. and have her pizza delivered by that one particular bohunk driver.
Reminds me of the Malcom In The Middle episode…
I love that show. Any comedy that can survive without a “laugh-track” or a studio audience gets high marks in my book.
Haven’t been watching TV much lately, though.
If you can rent the dvd-s, try Canadian series, “Trailer Park Boys.” Never saw “Malcolm in the Middle,” but people who liked MWC would like TPB, unless they object to constant foul language.
And what exactly is a woman’s place of solitude in the home? As long as you live with partners and kids - there’s no real peace no matter how many rooms you build.
kitchen, babe. If you loiter too long in there, you might get put to work…..
Hey, if they can have boudoirs (sulking rooms), surely they need a room to entertain B1ff.
“The home, which features a ‘woman’s getaway space - a place for solitude, renaissance and peace,’ according to advertisement literature, is on the market for $1.825 million.’
Well, that’s good. But does it ALSO have a ‘Man Cave’? Where a man can go for belching, beer-guzzling, rubbing bacon grease on himself, and making endless fart jokes? Because only then will this house really be worth 2 million bucks. I’m firm on this.
Think of the possibilities if they had BOTH. That house would be worth 4 million bucks!!!
I love the stereotypes that these overpriced yuppie houses propagate: that men are primarily interested in farting, belching and generally acting like frat boys in their “man cave”, while women are frail creatures primarily interested in scrapbooking and having a “renaissance.”
I’m sure there’s some truth to all that, but why not just have hobby rooms? Heck, our guest bedroom is, in reality, my recording studio. Very little belching or farting involved, and certainly no bacon grease.
I have something like that too. A 400 square foot fully kitted out home gym. Now that’s useful.
‘…and certainly no bacon grease.’
Yeah, surrrrre.
And if it’s true, ChrisO, why…you just don’t know what you’re missing. Your Recording Man Cave needs some bacon grease, and promptly.
Who needs a man cave to do all that??
Not you, so much is clear to me. The entire WORLD is your Man Cave.
I’m reminded of an episode of “Married with Children” when Peggy Bundy say she always wanted a sewing room, “You know somewhere where I can get away from the kids and drink wine.”
I’m an artist (metalsmith) and the unfinished basement works just fine for me.
My mother had a workroom for her sewing projects. After she went back to work, it was where she corrected papers. (She became a teacher.) When the door was closed, that meant that she didn’t want to be bothered. So, I guess that was her getaway room.
“The home, which features a ‘woman’s getaway space - a place for solitude, renaissance and peace,”
My house has one of these, but we call it the laundry room.
I can see it now, a place where your wife can stack crap all the way to the ceiling without having to hear any complaints about clutter.
My whole house is one big hobby room…
So is mine. It’s alternately a boudoir (sulking room–good one, Faster) or a stage for dramatic shouted soliloquies about ineffective storm water regulations, or else a magnificent moss hoarding facility, or a bacon-grease rubbing class. Sometimes I organize all these functions into efficiently numbered stations.
And no one may say me nay. I can pile up books and pretty rocks to the ceiling as high as I want.
Hey Oly, you’ll appreciate this, I just found a bunch of gem quality dino bone…
If someone wants to invest $2 million in a home, it might not be southeast Aurora for most people.
You don’t say. Too bad these geniuses didn’t think of that before breaking ground…
***** prior posting : “Residents in an upscale neighborhood in Gilbert finally saw a clean-up earlier this week that they’ve been waiting for since October. Weeds at a vacant house in The Grove in the Millett Ranch subdivision had become an eyesore, resident Joanna Turpin said.” *****
It really cracks me up how most people in the ‘upscale’ areas think manual labor is soooooo beneath them. They wont lower themselves to weed-whack some grass but willingly spend forever bitching & pointing & hen-clucking about how “someone” ought to do “something” about that terrible yard! Not THEMSELVES of course, but “someone”. Hell, if they all just passed the hat for $5.00 each they could easily pay a lawn maintenance person to come out once n a while. But noooo, better to spend that $5.00 on the early bird special, INCLUDING tip. heh heh.
saw a brief news clip last night on the Tee-Vee, of course interviewing people at the gas pump for reactions. with the expected results, and again a couple of people spouted “someone oughta do something”!
Made me laugh as I relayed this comment to a few friends, how stupid lemmings never take an interest in their own destiny or do any research into WHY or HOW things happen. To them things just magically happen and are entitled to their god-given rights of cheap gas, big houses & fast salad shooters.(nod to Kunstler)
Like how EVERYONE was buying houses. Or EVRYONE got the “Jennifer Anniston” haircut. I mean, hell, if EVERYONE is doing something, it MUST be right & proper, ne’ pais ?
Then of course the frogs try to scramble their way out of the deep boiling pot, not understanding what is happening, too apathetic to investigate, still braying ‘ SOMEONE OUGHTA DO SOMEHTHING’ !!!!
Hilariously sad. this country SO needs a natural culling of the herd already.
coffee cup empty - rant over. for now
‘Hilariously sad. this country SO needs a natural culling of the herd already.’
I got the bullets, if you got the time.
Olygal
bullets, eh? yer a card! tempting, but I could never assume the role of playing god as imperfection permeates my veins like a pot of Folgers.
have to leave the darwinism to mother nature & the creator, but boy-howdy sometimes you just want that 10Ib trout to force people to be more considerate towards their fellow man.
Oly, let’s do it. In fact, let’s do it Anton Chigurh style.
We go around the country picking wild mushrooms, drinking beer, yelling at the top of our lungs, and culling the herd in our spare time.
We can always pull a Thelma & Louise in case of problems.
‘Oly, let’s do it. In fact, let’s do it Anton Chigurh style.
We go around the country picking wild mushrooms, drinking beer, yelling at the top of our lungs, and culling the herd in our spare time.’
I…I…I’m so in love right now. I better go lie down in the foyer for a bit, regain my composure and all.
Does your foyer have the fabled fainting couch that is the must-have item these days?
In any case, you pick the wild mushrooms; I’ll make the risotto. No point in culling ourselves, and me being responsible for that and all.
We’ll even make our own broth for the risotto, and then we will scream at the top of our lungs out of sheer glee.
A fainting couch? You must be one a them there geniouses. I was at work at the time, which is why there was a foyer available. Here at home I just have to faint where I can find a spot that doesn’t have moss on it.
Yes, you are so right–no point in culling ourselves. Me mushrooms, you risotto.
This one’s for you LV landlord:
‘MGM Mirage, the Strip’s largest casino operator, is laying off some 440 management employees at both the property and corporate levels, a response to the souring national economy but also part of a corporate belt-tightening program begun last year.’
‘The employee reductions were companywide but the bulk of layoffs took place in Las Vegas. In February, MGM Mirage said it reduced the job hours or laid off roughly 150 employees at Circus Circus. The company was one of several casino operators that took steps to reduce hours or cut back its casino work force at the time.’
‘Last week, the Gaming Control Board reported that gaming revenues in February fell almost 4 percent statewide and more than 3 percent on the Strip. Meanwhile, the stock prices of the major gambling companies have fallen, some as much as 20 percent, since January.’
‘Falling stock prices and gambling revenues are viewed as signs the slowing economy is affecting the Strip, once viewed as impervious to outside financial concerns.’
‘On the Strip, average daily room rates are down as much as 19 percent from a year ago. In a report to investors on Monday, Bear Stearns gaming analyst Joe Greff, who surveyed most of the major Strip resorts for room prices, said any near term recovery is not on the horizon.’
‘The results of the survey reflect the impact of a slowing economy on travel to and spending on the Strip,’ Greff said in a note to investors. ‘When it stops is tough to forecast with any great precision, though we think this continues through the summer.’
We got a cardboard box reserved for you LVLL, if you can hitchhike out to Arizona.
Wasn’t she always out on the prowl for her next great investment property ?
casino operator, is laying off some 440 ??
I was in Reno for March Maddness…Taxi driver told me that the Peppermill was down to a three day work week for thier employees and that the Peppermill was doing the best out of all the casino’s…He said the dowtown casino’s were dead….
I am staying at one of the “upscale” casinos here in Reno at this moment. It is dead. The whole city seems depressed. Then again, Reno is a dump.
I’ll be taking a bike ride up the Strip this weekend.
Will report on change in “vibe” if noted.
Um…Could it possibly be because California passed Propositions 94,95,96,97 last election? You know, the ones that greatly expanded Indian “gaming” casinos to keep more tax revenue in California and out of Nevada? I knew when I voted for them what effect it would have on Vegas and Reno. Plus with the price of gas as high as it is, many seniors, who make up the vast majority of habitual gamblers, would rather play closer to home to save time and money.
My wife just saw a report that the Flamingo canceled her favorite show, rather abruptly. Darn, another reason not to waste money in Las Vegas
Not to be a wet blanket but what happened to all the “sin/vice” portfolio performance? If we really ARE… in recession these escapist venues should be flush w/ patrons, no?
Welcome to the OTHER… side of housing-based consumption! No one minded burning through money ( as long as “someone else” would be the one paying it back ) either by buying or refinancing their home!
oh, I think sin & vice will do just fine. However, it will be the closer-to-home versions that will score (hey! Indian casinos!), vs. the drive/fly destinations.
I think the lower-end component of that kind of portfolio — budweiser, the cheap seats at a baseball game, tobbaco, weed, video games and chips and salsa. and, maybe the local strip joints are doing ok - if you’ve got ‘em nearby.
Too much travel involved in getting to vegas, perhaps. it’s sin - but it’s a really discretionary purchase - and, for most of the country - not something you can decide to do at the spur of the moment.
Or…. regret having done at the spur of the moment?
Thanks for the feedback! I kept looking at it and wondering, what’s wrong with this picture? I guess the tough part for Vegas is that the airlines aren’t really in a place where they can afford to be generous, regardless of the comps.
O.K, now we need to set up a l-o-c-a-l sin fund!
Rooms went way up for no good reason about 2 years ago and are still way higher than they should be. All they’re doing so far is giving some lame discounts.. but i do think the major hotels will feel the heat and drop eventually.
speaking of vegas .. saw something weird last week.
I’m leaving the Venetian, walk into the self-park garage, 6th floor.. and there’s a boot on a car .. walk towards my car and i see 2 more. There had to be about a hundred in the whole place if the three I saw was averaged out.
I guess the City of LV now patrolling private parking lots to boot people for unpaid parking tickets? If so, it must be hurting for money.
“On the Strip, average daily room rates are down as much as 19 percent from a year ago…”
Well, good, because I’m going to be planning my annual July trip to Las Vegas soon and I’d like to get a good deal.
It’s usually quiet during summer weekdays anyway, but I love it if this year it was quiet as the grave.
I go out there for the Defcon conference… hope the rates are down come August!
WTF? I looked for a trip to LV next weekend and Caesars rooms are $649 a night. Treasure Island is $300 a night. Wynn, Bellagio and Mandalay are sold out. So how exactly does this work? Hotels are sold out and yet the city is hurting due to a lack of tourist dollars? Something doesn’t compute here.
Hotels are sold out and yet the city is hurting due to a lack of tourist dollars?
Maybe these trips were booked before things got too bleak? Lots of conference business in Vegas.
Or, maybe it’s all the Asian visitors bringing some of our money back?
the lack of asian junket (whales) are said to be the reason LV revenues are down.. the big corporations (mirage, Wynn) have built new super-hotel casinos in .. where was it.. Macau?
Yeah.. the Strip room prices are way high, even if you look far into the year, like September. Off-strip hotels have remained reasonable.
Buddy was just at the Venetian a few weeks ago. No more free drinks at the sports book. Have to prove you bet at least 100 bucks and then you have to get a ticket for the drinks.
He just bought a few beers and saved 85 bucks.
April/May are prime conference months, especially in the medical business (Sept/Oct are the other peak months). So yeah, the no vacancy rates probably reflect that…
“‘It’s always been a nod and a wink with certain segments of our economy on what they make,’ Jamison said. ‘Candidly, that segment has dried up because of the risk factor. Bankers are pretty dumb, but when you get hit in the head several times, you say, ‘OK, that’s not a good product.’”
I must say that bankers, for all their dumbness, are remarkably well compensated.
“With the decline in home prices, first-time buyers would rather spend $150,000 for a small home in a good neighborhood with a back yard than the same prices for a converted apartment, Las Vegas housing analyst Steve Bottfeld said.”
Yep, the buyers may be stupid with money, but their not really all that dumb about what they want. Given the choice, most will financially slap said banker with that 20 lb trout till he gets the message.
Oh, you mean Steve “thereisnohousingbubble” Bottfeld?
I did a quick check last night for SFH in Vegas for under 150k ( as it turns out ) and there were over 800 listings! Many of which are new or newly defaulted. I’ll look again in another 6 mos. but things are definitely trending correctly there.
Oh btw, just 2 years ago a search w/ those perameters would have yielded only condos. Dark, dank, run-down late 70’s condos.
Bambi?
Old Cinderella story ending: Coach turns back into a pumpkin
New Cinderella story ending: Condo turns back into a apartment
“‘The one thing you have to do to have success in condo conversions today is not sell them to investors,’ said Bottfeld. ‘Because as soon as there is a perception that you are buying into an apartment, you have lost the entire panache. The whole idea behind conversions is the first-time home buyer.’”
These LV analysts get away with really dumb statements all the time. You ARE buying an apartment! And the only people that would do that are speculators. Condo conversions are the last to take off and the first to crash in every boom.
BTW, when these lux condo projects started to unravel in late 2005-06, turkeys like trump beat their chests and bragged they were better than the quitters. Well, I’d fire a guy who made this decision:
‘The $420 million, 49-story Palms Place on Flamingo Road added 599 condo-hotel units; and the $1 billion, 64-story Trump Tower on the Strip added 1,282 condo-hotel units.’
‘For the condo-hotel segment, 11 units were sold at a median price of $395,000.’
They actually sold 11 of those things? There’s more stupid out there than I thought…
Never underestimate the stupid out there.
Never.
They’re not calling them “re-partments” for nothing.
Condominium refers to the form of ownership while apartment is a type of property. Most residential condos are apartments, while a few are row houses (town houses in developer speak) and some are in other horizontal structures. Years ago developers discovered that people will pay more money to buy an apartment if it’s called a condo. So even though you may be purchasing an apartment that’s within a condominium regime you will never see the word apartment appear in any of the sales material.
“The number of building permits for homes in the city dropped by more than half from 2006 to 2007. A slow down in home construction should not be a surprise with the country’s building and credit problems, though, said Bambi Spahr, director of the Reno-based Builders Association of Northern Nevada.”
“‘They’re not building ‘A Field of Dreams,’ she said.”
____________________________________________________________
If you build it, they will come*
*this cliche expired in 2007
“‘What kind of recourse do we have as neighbors?’ she asked. ‘Should it be up to us to clean it up? That doesn’t seem like it should be the case.’”
Oh, I don’t know.. must have been my upbringing, but when My neighbors are gone, I pick up around their front yard for newspapers and odd assorted things that may have flown by. Don’t even know these neighbors, but it keeps the neighborhood presentable, and from unsavory types from getting near their property and MINE>
What has happened to our society where we no longer look out for our neighbors, which in turn looks out for our best interests as well?
I mean, darn, pay the gardner a little extra to every other week go over the “neighbors” front lawn. geeze.
“that doesn’t seem like that should be the case”
Oh brother.
“It’s all about me” 1999(thereabouts)-2008+
A nearby neighbor fell and broke a leg in December ‘07. Pretty serious thing to happen to an 87-year-old. So, she’s not living in her house anymore. We, the neighbors, have been keeping an eye on her place, taking in the mail and the papers, picking up the trash that blows in, etc.
You know what? It really isn’t that difficult. Too bad that other people don’t think that way.
““It’s all about me” 1999(thereabouts)-2008+”
1980-present seems more like it to me.
Cell phones, e-mail and the internet. Who the hell needs neighbors as friends when your friends can be anywhere in space and time? MySpace and Youtube is our neighborhood now, and the favorites on your cell have replaced the block party.
“But they’re being denied that opportunity, said Cory Frey, senior loan officer for Southern Fidelity Mortgage, because they can no longer use so-called stated income loans, or loans based on income other than reported wages.”
This has been my stand all along, that I don’t give a flying F what FHA reformation, Fannie or Freddie limits and guidelines come down the pike, unless these toxic products referred to here return tomorrow, the housing correction longed for by many will not return - PERIOD!
Bingo, ex. This is central to the illusions of future granduer offered by the real estate industry. Without the rocket fuel of NINJAs, the future is now.
Haven’t you heard? It’s the media’s fault! There is so much pent up demand for all the rapidly appreciating million dollar homes! What a great investment…buy now before they sell out!
If they would only just stop talking about the housing crash, it would go away! That’s only affecting the rest of the country, not us…we’re different!
(I want to be a realtor when I grow up, some day)
“‘What kind of recourse do we have as neighbors?’ she asked. ‘Should it be up to us to clean it up? That doesn’t seem like it should be the case.’”
Geeze, grew up watching out for others/neighbors etc, so what happened to our society that now “It is all about Me”?
It always protects neighbors property and yours, and if they are now gone for good, definitely pick up /mow.
‘Should it be up to us to clean it up? That doesn’t seem like it should be the case.’
Sheesh
“Canadian investor Trevor Matheson has taken an interest in metro Phoenix’s real-estate market. So much so that he plans to buy six homes in the area over the next year.”
LOL. Canadian knife catchers. ‘Cause prices couldn’t possibly drop more as Alt-A loans reset, unemployment rises, consumer spending falls, and energy & food costs rise.
SSSSSSShhhhhhhh ! Those wealthy foreign investors will save us ! Isn’t that what the REIC was saying all along ?
I thought it was the rich baby boomers!
I know Trevor. Back in grade school I could always trade my apple for his twinkie.
“‘Everybody was really optimistic coming up on the end of ‘07, thinking maybe we were going to sneak through and not have the impacts here,’ said real estate broker and former Vail mayor Rob Ford. ‘Now here we are and everyone’s saying, ‘Oops, maybe we are going to be affected,’ but no one seems to know how deep it’s going to go.’”
Dah ! Way to go Homer
“‘What kind of recourse do we have as neighbors?’ she asked. ‘Should it be up to us to clean it up? That doesn’t seem like it should be the case.’”
You’re not really neighbors in the true sense, you’re just lazy self-indulgent assholes who want things done for you. Free of course.
Lazy, self-indulgent ahos is an apt description for a lot of my neighbors. And, I suspect, many of your neighbors too. These are the people who like to complain about The Neighborhood, but do they lift a finger to help improve it? Nope. The next time I hear one of them start on a whine-a-thon, I’m going to say this:
Want a better neighborhood? Be a better neighbor.
Then I’ll walk away.
mo money
that phrase is a nice turn of words; ” You’re not really neighbors in the true sense, you’re just lazy self-indulgent assholes who want things done for you. Free of course.”
beautiful. just beautiful !! hope you dont mind if I copy, enlargen & post it on a large board in our HOA clubshack/swimming pool area? happy to credit you as the source. well done.
Hee hee, feel Free. I feel like posting it in our trash/recycle area. Not only is it too hard for these idiots to actually get their trash into the cans without spilling it all over the ground and not picking it up, breaking down boxes and not throwing cat turds in the recyling bins is way too hard. Don’t get me started on the dog owners who are too lazy to walk their damn hounds 1 block to the park to take a dump.
“The 2007 Parade of Homes”
Parading homes nowadays is as easy as herding cats…
Seems this has become very typical. The one in Seattle ( where they were set ablaze by “environmental extremists” ) so keep flammables at a safe distance!
“‘Nobody in the area has a house for sale,’ Turpin said, ‘but we were just embarrassed to have people over. Even the guy who cleans up our yard asked what was going on in the house across the street.’”
These limpwristed lillies are “embarrassed” by someone elses weeds? WTF am I missing here?
1980s: You are what you drive.
1990s: You are where you vacation.
’00s: You are where you live.
I dunno. That chit was important in high school but…..
“The couple recently reduced their home price by $30,000 in hopes someone will take a second look at their house and make an offer. ‘We’ve done quite a bit of work on this, and I just feel like when the right person walks through here, they’re going to say, ‘Okay, that’s the house I want,’ David Standage said.”
The article sort of gives the impression that Standage is simply a struggling owner, but recorder data gives the impression that he is a serial East Valley flipper. The house mentioned in the article is listed as vacant, and so it is obviously not his residence.
MLS # 2921004 (250-plus days on market)
Sold in 2000 for 190K.
And they’re selling it for…$469000.
Even Zillow Man, He of the Overestimate, has it estimated at 309.
Good luck, Mr. Standage
From the Canadians buying in Arizona article:
“This home was well-maintained and was listed in the mid $400,000s - a great buy,’ Watson said. ‘My advice was to come in with at least a $375,000 offer. However, they decided to offer $250,000.’”
“She said the couple had heard property was selling for 50 cents on the dollar in metro Phoenix. So no matter what, they weren’t going to offer more than 50 percent of the asking price, she said, and the bank turned the offer down.”
“‘The buyers wound up getting back on a plane to Canada without having purchased anything,’ Watson said. “They could have had a great buy if they had just been realistic about the market.’”
Good for them. It is a crying shame that they had to head back to Canada without letting Diane Watson fleece them.
How much you want to bet that she was showing them the houses that had the best comission rate, NOT the best deals!
They were smart. I doubt even a $250K house would pencil out as a rental.
But but but…
Those rich Albertans are supposed to be supporting the RE market in British Columbia! It’s “the best place on earth”.
What do they want to live in Arizona for? Doesn’t all that sunshine get boring? It’s worth twice the price to get rain and snow!
“Expert says market to benefit Baton Rouge apartment renters”
http://www.2theadvocate.com/news/17893369.html
Wahooo! More W. Colo. news!
Emailed an empty spec FSBO for 500k by the Cedaredge golf course, asking if they’d rent it. If any of you know Cedaredge, it’s a tiny town on the flanks of Grand Mesa (W. Colo.) with virtually no jobs. Golf curse homes there go for 200k and up to about 300 (all overpriced). This guy thinks he’ll get 500k. He was a bit short about the renting thing, for some reason
. I’ve now seen houses in W. Colo, that have been on the market for 2 years plus with very little price capitulation. Confident but clueless sellers will hopefully begin slowly waking up with the bears, it’s spring and no buyers.
“Golf curse”
Yes, I feel my Golf game is cursed also. And I didn’t even have to buy a house on a golf course !
a tiny town on the flanks of Grand Mesa (W. Colo.) with virtually no jobs
It is puzzling how outside of the resort areas that the dirt poor western part of the state got so expensive, blowing way past the much more prosperous front range. For those from out of state, the western slope is practically considered a different state here on the front range, more like an extension of Utah. Its separated from the front range by the Rockies, so while on a map it doesn’t look that far away from Denver, because of the mountains it is.
The west slope is an absolute desert, much more like Utah, like the above poster says. The oil industry here is apparently booming, which has led to strangely high prices in Grand Junction, which is as much a desert city as anything in Saudi Arabia. Summer nights in the 40s, days over 100.
I consider myself marginally on the Western Slope, but at about 9,300 feet, the landscape is a far cry from Junction or even Montrose.
Well, parts of the W. Slope are like Utah, desert, but it also technically includes the ski towns and everything geographically west of the Continental Divide. So… SIlverton, Durango, Steamboat Springs, all are part of the West Slope. It’s hard to categorize an area with such diversity, economically and topographically.
It is diverse, but not very populated. About 90% of Colorado’s population lives in the Front Range. I would guess that maybe 200K live west of the continental divide (there are more people in Larimer County).
Offer him 100K and see what he does.
“I see nothing, nothing!”
Sgt. Schultz
“Developers fought to get one of the city’s largest subdivisions approved more than two years ago, but not one room at the Shulz Ranch has been built. Work on the 521-home development in South Carson City might not start any time soon either.”
Ya know, these Street of Dreams places have gotten steadily larger and fancier over the years, to the point where maybe 1-2% could afford to buy them. I guess they make nice showpieces for builders, but come on. I believe in Portland, only one of last year’s crop sold so far. Not only have I no sympathy, but even if I could afford one of these, I’d never buy it, because I consider such a waste of scarce resources the height of irresponsibility to the rest of the planet.
(rant off!)
MacAttack,
Hard to disagree w/ that but what’s more is that by and large the “fake it before you make it” ploy has totally lost it’s impact. There was a time when that kind of “daring consumption” may have gotten you noticed but today most successful people ( you were hoping to rub elbows with ) see straight through that.
In today’s business community things have come full circle. Instead of envying you or “wondering how he did it” they’ll see you for what you are. An insecure climber, and nothing more. Good luck on those sales though!
We need to bring back the bumper sticker - but put it on the front door. You remember the one: “Don’t Laugh, It’s Paid For!”
2007. Parade of Homes.
2008. Parade of Foreclosures.
I don’t have any sympathy for a worker making 50K a year in tips complaining that they can’t get a loan because their tax records say they only make 20K. Declare your tips and pay your taxes. Voila, you can document your loan.
I love how people complain about the downside of committing tax fraud.
So true, especially for people that are W-2 employees? I mean as a ‘consultant’ or contractor you look at these people and ‘on paper’ you’d think you’re looking at a pauper.
What makes it MORE ridiculous is that there’s where a large chunk of Alt-A comes from. Self-employed people that were basically just declaring “mom’s” income all of a sudden seeing a housing boom taking off so now they want to get on the bandwagon! So they show all this fluffed-up income!
Well I don’t know about the other self-emp. people on this board but it’s a l-i-t-t-l-e difficult to go from making nothing ( which I basically did my 1st year ) to making 100K the very NEXT year!? Someone want to show me how that works? Because clearly I’m not the bus. genius I “thought” I was?
No fraud/tax evasion here!
“‘The question is, ‘What is normal,’”
“Conan, what is good?”
“To crush your enemies, see them driven before you, and hear the lamentations of their women.”
Barbarian…
1. Bonus room (where’s the bonus?)
2. Renaissance room (where to put the shields and suits of armor after mailing back the keys?)
3. Room with a view room (a view of the foreclosure sign and weeds)
4. Padded room (holding room for late-to-the-party flipper who flips out)
RE: “The home, which features a ‘woman’s getaway space - a place for solitude, renaissance and peace,’ according to advertisement literature
Oh, WOW! A woman’s getaway space!
This makes the nut for me!
Where do I sign?
“woman’s getaway space” — The car usually works pretty well. You don’t necessarily have to drive it anywhere, or if you do, you can just go around to the other side of the block.
My sources here in Albuquerque say this is going to be the next mini-Las Vegas. Casinos here building healthy and business appears to be booming. Is everyone here going to make a gambling trip to Albuquerque? Nice place to visit. But each casino is a stand alone entity. No hopping (at least 10 miles apart). Albuquerque - it’s a trip (the city tourism slogan).
ABQ is indeed a trip. Love all the tattoo parlors…..
but maybe when they get that light rail system to Santa Fe up and running, ABQ will actually take off.
So where are the people going to come from?
Denver? We have “Vegas in the Mountains”
SLC? Phoenix? SoCal? PNW? Vegas is closer.
El Paso? Lotsa big spenders there, I’m sure.
Dallas, Houston? Aren’t they kinda far?
beats me….from my neck of the woods (Oregon), maybe…the next generation of rainbirds. But once again, the drive/fly equation kicks in.
I keep saying I don’t want to make any more loans (in PHX area condo-structured RV parks). But, the request that came in yesterday was too good to pass up. Borrower has $200K in an IRA, wants to buy a $95K lot-plus-mobile, doesn’t want to take a lump sum taxable withdrawal, can make a $22K down payment. After that, the borrower will be taking $1000/mo from the IRA to pay to me at 9%; that takes something just under 9 years to pay off. The $95K price for the particular property is indeed outsized, but the $73K I am asked to lend is not any more than year-2000 prices, so why not. Esp as the borrower is not likely to walk away from the $22K. Not due to close until August, let’s see if the buyer follows through — I believe $2K earnest-money has already been paid.
I have an idea that if this borrower were to do some very careful tax calculations, it might prove less expensive to take out (let’s say) $2K/mo and pay a little more income tax, the better to avoid some of my 9% interest. But I’m never unhappy to take money that these people don’t want to give to Uncle Sam; I give him plenty myself !!
“Casinos here building healthy and business appears to be booming. Is everyone here going to make a gambling trip to Albuquerque?”
Rhetorical question no doubt.
I know if I wanted to waste money while inhaling other people’s cigarette smoke I could do it here in the Arizona casino close to me. Too bad I never step foot in that place, I’ll let the blue-haired suckers stepping off the charter buses fill in for me.
I say the casinos are a joke to build an economy on. They are a 0 sum game. For someone to win, someone has to lose. More people lose their A$$es to make a few rich. I only go in them because someone pays to check out the service. It is like a job. I hate the smoke too. Good reason to make the visit short. But food is great. I don’t see too many charter buses at the ones here. And the Indian casinos are probably in almost every state (except home state of UT and Hawaii). The Utah folks have them near the borders in ID, NV, AZ, CO, and NM (don’t know about WY).
Wyoming has parimutual horse racing in Evanston, 1 hour from Salt Lake City.
Just went through Wendover Nevada (1 1/2 hour from Salt Lake). What a dump, but lots of double wides and 6 casinos.
Worked as a consultant for one of the big casinos in Vegas — I know the win rate for every game, a suckers bet all of them. They will make a lot of money off of all the people who think they can count cards playing 21, ’cause they saw it in the ‘21′ movie. Ha.
But lets just call it ‘gaming’ and not gambling, which is a dirty word. Sort of like calling ‘flipping’ investing.
jb
Worley, ID. (Pop. 223 in 2000). We used to stop there half way through our road trips when I was a kid, eating quickly in the fly infested diner. Now they have a casino with 200 rooms, and a spa.
This will help the CA housing situation LOL
http://news.yahoo.com/s/ap/20080418/ap_on_re_us/wooing_teachers