Waiting For A Better Value
The Boston Globe reports from Massachusetts. “Prices for Massachusetts single-family homes plunged nearly 11 percent last month, the biggest slide since the depths of the real estate downturn in the early 1990s. ‘The Bay State’s housing market is looking a lot like it did at the end of 1990,’ said Timothy Warren Jr., CEO of the Warren Group.”
“A separate report on the local housing market was also issued today by the Massachusetts Association of Realtors. The reports showed mostly similar trends. The March median selling price of a detached single family home in Massachusetts was $315,000, a drop of 8.4 percent from March 2007, the association said.”
“‘Foreclosures are still running rampant and causing a glut of homes to hit the market,’ Warren said. The last time house prices fell this much in Massachusetts was an 11 percent slide in December 1990, he said.”
The Republican from Massachusetts. “There were two cars parked in front of 144-146 Prospect St. Friday morning; one of those cars sported a bright red banner that said ‘AUCTION.’”
“About 90 seconds after the auction began without even the clap of a falling gavel…there was a single bidder at the sale. The mortgage holder, LaSalle Bank NA, purchased the three-family home for $101,250. ‘They need to protect their interest,’ said Ronald J. Marcella, an auctioneer from Dalton who represented LaSalle at the sale.”
“Nearly 3,000 Massachusetts homeowners had their property foreclosed in the first quarter of 2008, according to a recent study.”
“‘The number of people losing their homes to foreclosures shows no sign of abating,” said Timothy Warren Jr. ‘The last time more than 1,000 foreclosure deeds were filed during one month was in August 2007 when 1,018 were filed.’”
“‘We hope that represented something of a peak, but March’s numbers have shown us that Massachusetts’ foreclosure problems continue to worsen. With steady increases in petitions, I don’t see this problem going away any time soon,’ he said.”
“Mary R. Pennicooke, of Springfield, said she got a foreclosure letter from her lender in February. Pennicooke said she bought a house in Springfield two years ago with $18,000 down. Since then, she’s lost her job and the payments on her adjustable-rate mortgage have gone from $1,200 a month to $1,600. ‘I wasn’t earning $1,600 a month,’ she said.”
From Enterprise News in Massachusetts. “As foreclosures statewide hit a new peak in March, the city has partnered with the state and area lenders to provide discounted services to buyers of bank-owned property. The home-buying initiative, Buy Brockton, launched this week is the first of its kind in Massachusetts.”
“It allows borrowers to buy homes in the city that are bank-owned, in foreclosure or being sold in a short sale without the customary 5 percent down payment.”
“‘The local housing market has been devastated by the foreclosure crisis affecting our nation,’ Mayor James E. Harrington said in a press release.”
“The number of foreclosure deeds filed in Massachusetts rose to a new peak in March when 1,167 foreclosures were recorded, according to The Warren Group. The figure — a 140 percent increase from March 2007 — represents the highest number of foreclosures recorded in the state since the firm began tracking foreclosure deeds in 2005.”
The Boston Herald from Massachusetts. “With a growing number of Massachusetts homes falling into foreclosure, real estate agents say more and more ex-owners and tenants are vandalizing properties on their way out the door.”
“Jack O’Leary has seen foreclosed homes where ex-owners put paint on the carpets, anti-bank graffiti on the walls or took everything but the kitchen sink - then stole that, too. ‘I’ve gone into houses where the light fixtures are gone, the toilets are gone, the kitchen is gone. And when I say ‘gone,’ we’re talking stripped down to the bare walls,’ said O’Leary, a Brockton real estate agent who specializes in foreclosed homes.”
“Broker John Agostinelli just put a Watertown condo on the market where someone removed all doors, kitchen cabinets, appliances, gas fireplaces - even the light switches. ‘This property has the most damage we have seen of approximately 30 properties we’re (currently) listing,’ said Agostinelli, who’s selling the place ‘as is,’ knocking down the price some $90,000.”
“O’Leary has reduced an Easton split-level ranch’s cost by about $200,000 because someone ripped out appliances, sinks, toilets and more. ‘You drive up and say, ‘Wow, what a nice house!’ the broker said. ‘Then you look inside and say: ‘My God, what happened here?’ Short of taking the shell of the house, everything is gone.’”
“Agents say that while they can’t condone vandalism or theft, they sometimes understand the frustration - or desperation - that leads to such acts. ‘Some of these homeowners were victimized (by scam mortgages) and have legitimate gripes,’ O’Leary said.”
“But the agent also recalls one case where a foreclosure ‘victim’ had two new SUVs, a 25-foot boat and a 45-foot motor home parked in the driveway.”
“‘That’s not victimization,’ O’Leary said. ‘That’s setting your priorities wrong.’”
The Indypendent from New York. “There was a time when Simeon Ferguson grew tomatoes and callaloo leaves in the garden behind his three-story brownstone in Crown Heights, Brooklyn, the home he has owned since 1975.”
“But his remaining years of rest and relaxation are facing a major obstacle — his home is at risk of foreclosure. In early 2006, Michael Bocelli, a mortgage broker with the Long Island-based Global Financial Inc., sold Ferguson a new $450,000 option adjustable rate mortgage that was fairly guaranteed to put his house in foreclosure, according to Ferguson’s attorney.”
“Mr. Ferguson, a retiree on a fixed income, had no attorney or family members present during the closing, but was apparently quite happy with the deal. He later told his daughter Karlene that he had negotiated a new, more affordable fixed-rate mortgage. In fact the monthly payment of $1,480 on even the ‘teaser’ rate was greater than his entire monthly income of $1,100.”
“On top of his $6,675 broker’s fee, Bocelli was paid an additional $14,420 by IndyMac, the California-based bank that gave Ferguson the loan. This fee was contingent on signing Ferguson up to a ‘No Income No Asset Loan,’ which carries a higher interest rate, according to documents.”
“In its own paperwork, IndyMac explicitly instructs the broker that, ‘The file must not contain any documents that reference income or assets.’ In fact, Ferguson has only a few sources of easily documented income — social security and a pension.”
“Depending on when you speak with Ferguson though, he may or may not remember the details. That’s because he has dementia, a condition he was diagnosed with in 2005.”
“By the fall of 2007, one in four homeowners with subprime mortgages in the historically black neighborhoods of Crown Heights and Bedford-Stuyvesant were in foreclosure, according to the Federal Reserve Bank of New York.”
“At age 93, Artee McKoy of Jamaica, Queens, a homeowner for almost 50 of those years, he is still confused about how somebody could take his home out from under him without his knowledge or consent and saddle it with a new $315,000 mortgage from Fremont Investment & Loan, until recently one of the country’s biggest subprime lenders.”
“McKoy is also confused why the three-bedroom duplex is currently in foreclosure. Like Simeon Ferguson, he suffers from dementia, a symptom of Alzheimer’s disease, which he was diagnosed with in 2005.”
“‘It’s a huge warning sign when a 93-year-old man with no attorney present can take out a $300,000 mortgage,’ says Professor Ann Goldweber, director of the Elder Law Clinic.”
“‘Some of the new products that were created in the last few years had a lot of moving parts,’ says Evan Wagner of IndyMac. ‘For people who got these loans that weren’t really intended for them, it’s kind of like taking a medication that isn’t intended for what it’s meant to do, and sometimes there are bad side effects.’”
The Poughkeepsie Journal from New York. “It is a scene that is played out often these days in the lobby of the Dutchess County Courthouse in Poughkeepsie. In a corner that has become known as the ‘foreclosure alcove,’ someone’s home is being auctioned off.”
“On a recent morning, a Pleasant Valley home that belonged to Vernon R. Tatem was sold at auction. A handful of people showed up; no sign of Tatem. Bids began around $130,000, but the lender insisted on at least $169,590. The winning bid, from some local investors, was $1 more than that.”
“According to county records, the property was assessed in July 2006 at $310,400.”
“‘It’s unfortunate, really,’ said Sandra Nesheiwat, one of those investors. ‘The problem now is prices of houses have gone down and the mortgages are well above what the houses are worth.’”
“Foreclosures jumped in 2006, ran high in 2007 and, so far, right into 2008. Bankruptcies, some aimed at staving off foreclosures, rose 41.4 percent in 2007 over 2006 in the region served by the Poughkeepsie Bankruptcy Court.”
“In Dutchess, 3,569 subprime loans were made in 2006. Of them, 740 were late 30 days or more on payments and 276 in foreclosure. In Ulster, 302 were late, according to the report. Many of them are also adjustable-rate mortgages. Of those 2006 subprime loans whose rates will adjust by October 2009, likely with higher payments, 759 of them are in Dutchess and 267 are in Ulster.”
“Brad Kendall, Dutchess County clerk, said his office’s records of default notices, or lis pendens filings, has shot up. ‘If you’re looking at the number of the lis pendens over the years, it gives you a sense of how much trouble is out there. It’s about doubled over the last few years,’ Kendall said. Filings in 2007 hit 1,184.”
“‘It’s going to continue upward. The real estate values in the Hudson Valley had been increasing … which had allowed people to refinance their homes to pay off their credit card debts. That cycle has come to an end,’ said Thomas Genova, a bankruptcy attorney in Wappinger.”
“The ‘refi’ move no longer works when equity, or the homeowner’s share of a mortgaged home, is gone. Tapped by refinancing or home equity loans, what equity may be left disappears when the property value declines, Genova said.
“Another option is to walk away and give up the home. ‘The biggest change in this practice over the last six months is people coming in and saying, ‘I can’t afford to keep this house anymore,’ Genova said.”
“‘It’s turned 180 degrees from, ‘How do I keep this house?’ to ‘How long do I have to stay in this house before I have to leave?’ Genova said.”
The Journal News from New York. “For the past two years, the residential real estate market in the Lower Hudson Valley has resembled a stalemated chess game, in which buyers on one side and sellers on the other have refused to make a move.”
“Those in the market to buy are waiting for prices to drop to a level that represents better value.”
“Sellers, on the other hand, not keen on seeing some of the vast equity they’ve accrued in recent years suddenly slip away, are holding firm on prices. They include homeowners such as Soneka Samakai, the owner of a contemporary three-bedroom Colonial in Garnerville.”
“Samakai is selling her 2,200-square-foot, two-story home because she recently married and will soon move south with her husband. Though Samakai understands the market has slowed considerably throughout the Lower Hudson Valley, she was reluctant to ask less than the $500,000 that the home first listed at, but has since lowered the price by $15,000, to $485,000.”
“Equally vexing to Samakai is why buyers don’t instantly fall in love with the home, which features several updates, much as she did when she purchased it in 1999. ‘I just don’t understand it,’ she said.”
“Until homeowners and homebuyers can reach some accord, lower sales numbers are likely to continue. During the first three months of the year, sales dropped by about a third in Westchester and Rockland counties and nearly 10 percent in Putnam.”
“Meanwhile, prices held firm, with median prices for single-family homes in Westchester dropping by just 2 percent. In Putnam, the number is down 3.4 percent, while Rockland saw a drop of 5.2 percent.”
“‘One way of expressing what we have for this market is, neither party is motivated,’ said Greg Rand, managing partner at Prudential Rand Realty, which has 20 offices in the Hudson Valley. ‘A 2 percent decline in median sale price (in Westchester) is disappointing to me,’ he said. ‘I want to see a 5 or 6 percent decline.’”
“In Peekskill, Gary Henderson and Divette Jones face a short sale on their small North James Street home, which they bought in 1986.”
“The three-bedroom, one-bath home was valued at about $300,000 at the height of the market in 2004, Henderson said. Needing to pay back taxes, the couple at that time sought to refinance their fixed-rate mortgage with Countrywide Financial.”
“The adjustable-rate mortgage that Countrywide gave Henderson and Jones came with a promise that they could refinance within a year and convert the loan to a fixed rate, Henderson said. But before the year was out, Henderson and Jones saw their mortgage payment rise from $1,600 a month to about $3,500 a month, he said.”
“That’s more than they can afford, said Henderson, who earns about $31,000 a year. Between his paycheck and Jones’ disability payments, the couple bring in about $3,000 a month.”
“The couple, who have two children living at home, have turned to a real estate firm that works with distressed homeowners, which has listed the home for $245,000.”
‘Foreclosures are still running rampant and causing a glut of homes to hit the market,’ Warren said. The last time house prices fell this much in Massachusetts was an 11 percent slide in December 1990, he said.’
It is interesting that the press in Massachusetts has refused to accept that they have had a housing mania, for the most part. So then they are shocked, over and over, as the situation gets worse.
The MA foreclosure rates have been at historic highs for years now, but it is rare that we see ‘housing bubble’ in the Boston Globe. Compare that to the Florida press, and the states reaction.
Thank goodness Massachusetts has the Warren Commission to set them straight about whether it was a loan gunman, or multiple listings…
I like the Warren Group as compared to DataQuick.
Historically, they have not sugarcoated the situation as much as DQ, the latter which implied on a nearly monthly basis that things were not as bad as they were in California… or who have had all kinds of qualifier statements that the “present situation” (whenever that might be) may not get any worse.
It appears DataQuick has done a huge disservice to the CA REIC.
I think it’s because we never had the big construction boom Florida and Arizona had, and the only bubble building involved city condos and some suburban townhouse developments. We don’t have a big construction component to our economy, so the knock-on effects of this aren’t as significant, although the reverse-wealth effect is very real.
Also, affordable housing has been a big problem for a long time and driving people out of the state, so that’s a silver lining. Florida with affordable housing is still not that desirable a place to live.
They’re utterly delusional in Massachusetts, and the Globe propagates it, boosts it recklessly. “The hospitals will save us.” (Did you know Massachusetts has the best hospitals in the world? Better than anybody else’s?) “The colleges will save us.” “The superior lifestyle of Massachusetts will save us.” It’s the Massachusetts Miracle.
And it’s even worse within the city of Boston. The Globe and local papers seem to be run by realtors here. I cant even pick up my neighborhood news because the articles infuriate me. They have no basis for anything they write.
“Mary R. Pennicooke, of Springfield, said she got a foreclosure letter from her lender in February. Pennicooke said she bought a house in Springfield two years ago with $18,000 down. Since then, she’s lost her job and the payments on her adjustable-rate mortgage have gone from $1,200 a month to $1,600. ‘I wasn’t earning $1,600 a month,’ she said.”
Honey, it wasn’t the adjustment of the ARM, or even the job loss that is causing you to be foreclosed. If you weren’t even bringing home $1,600, you couldn’t afford the $1,200 payment either. That leaves $400 a month of food, energy, savings, etc. I’m shocked she lasted two years in that place.
They should have furnished her the foreclosure letter at closing. If she was already paying at least 75 percent of her income toward the mortgage before the reset, there was no way this was going to work. She’s now out $18,000 plus the credit hit. Whatever the lender’s out is not nearly enough.
And everyone has the cutest, smartest child.
I was responding to this quote;
“Equally vexing to Samakai is why buyers don’t instantly fall in love with the home, which features several updates, much as she did when she purchased it in 1999. ‘I just don’t understand it,’ she said.”
Uh, because there’s one hundred houses just like it for sale just like it. Because your generic tract house really isn’t that special.
What was the asking price when you fell in love with the house Ma’am? A third of your current asking price, you say?
And 90 of those 100 have lower asking prices, more upgrades, better landscaping, etc, than yours.
Housing is now just another commodity and she did her little part in the process. So now she wants to hide behind the “dream home” excuse? Too late, can’t have it both ways.
The house she fell in love with didn’t cost half a million.
‘It’s a huge warning sign when a 93-year-old man with no attorney present can take out a $300,000 mortgage,’ says Professor Ann Goldweber’
Yet congress has time to fiddle with the tax code instead of cleaning up this business. It is true that mortgage people are going to jail every day. But where is the corporate reform?
You wouldn’t let most 93 year olds drive anymore, but a long-term financial commitment?
Sure…
If the 93 year old dude was in Canada, the banks would have stuck him with a 40 Years amortization mortgage…
“Yet congress has time to fiddle with the tax code instead of cleaning up this business. It is true that mortgage people are going to jail every day. But where is the corporate reform?”
Yeah… Thats typical. The grunts get jail time and those who led said grunts walk scot free.
Jail is too good for the “people” who made these types of loans. They deserve something far worse than the worst of prisons. Penalties should be even stiffer for companies that profited from this type of lending.
I am truly disgusted by this story…two old men with dementia getting predatory loans, and the only so-called “crisis” in this country is that home prices are dropping?
Also just heard on the news that Americans spend $1 Billion dollars annually on Hannah Montana merchandise, but more and more people are being pushed into poverty all around the country.
Words escape me…
Just wait ’til the movie comes out.
“On top of his $6,675 broker’s fee, Bocelli was paid an additional $14,420 by IndyMac, the California-based bank that gave Ferguson the loan. This fee was contingent on signing Ferguson up to a ‘No Income No Asset Loan,’ which carries a higher interest rate, according to documents.”
“In its own paperwork, IndyMac explicitly instructs the broker that, ‘The file must not contain any documents that reference income or assets.’ In fact, Ferguson has only a few sources of easily documented income — social security and a pension.”
“Depending on when you speak with Ferguson though, he may or may not remember the details. That’s because he has dementia, a condition he was diagnosed with in 2005.”
Not surprised..My brother is a CPA and use to do the tax returns for brokers he knew when requested..many wanted him to “make up” tax returns for the lenders..knowing the lenders would NEVER check with the IRS..he didn’t do them of course(protects that CPA license)..He remembers one broker that he did a legitimate tax return for a client where he told the broker..how is that guy going to afford a $850K house and a second note of $100K…the broker said don’t worry about it..The clients lost the house and the broker made 3 points up front and god knows how much YSP(legal bribe) from the lender…The brokers and the lenders were in bed next to each other..the law should go after them BOTH!!!
Hannah Montana, the new Shirley Temple. I’m waiting for the Golddiggers of 2008 movie to come out… Busby Berkeley we’re calling you, to distract us from our woes!
NSO,
I believed that I was past the anger stage with all this housing voodoo - but old men with dementia getting predatory loans - that put me right back into my rage stage.
I pray for justice, may the FBI (or whomever) track these perps down and deliver it swiftly!
Leigh
The man was clearly defrauded, but it’s not for the taxpayers to make right, it’s for the judicial system. He needs a lawyer (and he has one), not a bailout.
“Mary R. Pennicooke, of Springfield, said she got a foreclosure letter from her lender in February. Pennicooke said she bought a house in Springfield two years ago with $18,000 down. Since then, she’s lost her job and the payments on her adjustable-rate mortgage have gone from $1,200 a month to $1,600. ‘I wasn’t earning $1,600 a month,’ she said.”
If she wasn’t making $1600 a month, then how in the H*LL did she afford the $1200 a month… NO - wait - OH! I get it. She couldn’t…
I’m still blown away by the fact that she even bought the house in the first place. There goes her down payment, poof!
Huh.. So we’re talking, what, at least 75% of take home income on the TEASER rate for the loan? Yeah, that’s sustainable.
How in the he** did that loan get made?! Come on; at that income level, there’s NO way that person should spend more then 25% of their take home on a house…
Man, this thing is really picking up speed.
Consider the season too. We’re seeing depths of winter numbers in the spring. Sure, there’s lag time, but we all seem to be seeing the same thing in our respective city/town/suburb - the third silent spring is here.
My sentiment exactly spike66. I sat with the wife over the weekend going over NYSAR’s numbers for NY state for March 08. Get this…. EVERY single county in NY saw falling transactions year over year except Cayuga County. There were more negatives in the data than I’ve ever seen. This has really just begun in NY.
I am seeing the weirdest properties sporting SOLD signs. One is a real fixer upper that is probably a tear down. Its only redeeming quality (for some) may be that its across the street from a golf course. Another very teeny place that was already looking a little rough around the edges before the owners oxygen tank exploded last spring is also sporting a sold sign. Nothing like a charred front door to make you feel like home huh?
But really, these sales are so odd, my instincts are that somethings up.
I hope so. The smugness is starting come back amongst the local Anchorage RE crowd that prices aren’t dropping as much as in California and with all the influx of oil related jobs coming that prices will soon be rising again, perhaps by the end of the year. They’re right in that the price drops are occurring but plateauing because the knifecatchers are out in force this spring.
“Equally vexing to Samakai is why buyers don’t instantly fall in love with the home, which features several updates, much as she did when she purchased it in 1999. ‘I just don’t understand it,’ she said.”
She just can’t understand WHY the the next greater fool won’t pay her her GIVEN premium price for her equity vapors ?…humm
Because she can’t do basic math and doesn’t understand English?
“Samakai buys a house in 1999 and does some basic updates. Nine years later she goes to sell the house. True or false: Are these still considered current updates?”
Where are the receipts to even prove she was the one who made the improvements?
I’ve always kept all my house improvement-related receipts (and even took before/after photos) - foolishly hoping that a buyer would challenge me on the improvements. You know what? No one ever asked to see them - ever.
Well, according to HGTV and the flip shows spending a couple of thousand for a coat of paint and new countertops will automatically increase the house’s value by at least $30,000.
That’s HGTV math for yeh.
My wife and I have noticed the HGTV effect all over. When we see houses and notice that they are nicely “staged” we walk out to the garage or basement and always find all the real furniture from the house. Then we can get a much better ideal of how big the rooms are for people who actually live there. Assuming your a person who actually owns anything at all.
I posted on this below and just noticed it was already covered. The first thing I do when I walk into an house for sale with renovated kitchens and baths, and especially if there is any staged furniture, is to immediately walk out and cross it off my list. Life is too short to deal with ppl that believe in HGTV math. It screams “we are looking for a mark,” and I wont play that game. The worst is that the staged furniture and new paint is just for show, the reality is that very rarely do they address electrical, plumbing, structural and roof issues correctly, so someone like me would have to rip it apart again anyway. I watch Flip This (or That) House sometimes just to see what ppl are doing. Many just caulk, prime and paint over mold, rust, and structural problems. I really view it as more of a hobby than a profession. If they really love it, they shouldn’t mind taking a hit on each home. Economically it shouldnt work unless the investor is actually an expert plumber/electrician/contractor, etc. who can cut deals and put in their own sweat equity, and thus complete the project at below market rates. Househusbands/wives looking for an part time way to make easy cash, or the unemployed, without expertise should take a hit of on each home (recovering no more than 80% of their hard costs). And no, wanting to be a designer or decorator is not expertise. I love how the industry giants with products to sell convince the sheeple that if they can envision that a kitchen or bathroom would look nicer with granite and designer tile then they have the “gift” which they should use to flip or renovate houses. So many ppl actually believe that bs.
Oh, yeah (HGTV math and staging). The best is when those shows do things like paint the couch, or cover an interior wall with ivy…things that would only work if you cannot see them up close and don’t have to live with them.
Also, I have my own taste and I would rather buy a cheaper place in need of sprucing up and make my own decorating decisions. So would most people. Electrical and plumbing are not the fun part, and you don’t get to show them off to your friends or boast about your great taste. Ugh. I want to believe the best in people, but house flipping makes me very curmudgeonly.
I think I could do it and make it work just because I’m pretty dog gone handy, but the work is back breaking, and when the dust/taxes/hourly wages settle you might have been better working at mckydees.
The only flipper I’d buy a house from is Richard from Trademark in South Carolina. He uses crews of professionals and usually puts on a new roof, guts the kitchens and bathrooms and redoes wiring.
I’d never buy a house from Harry ‘Hamfisted’ Homeowner who only did cosmetic improvements and did the work himself.
The HGTV effect means a different thing to me. HGTV has been involved in updating a number of the homes in our area, and they stick out like a sore thumb in the MLS. A small 200k home, that had an 80K master bathroom update done. We actually viewed this home with our realtor, the first to do so in over 200 days on market, and had a good laugh. HGTV equals massive over-improvements to us.
The only flipper I’d buy a house from is Richard from Trademark in South Carolina.
And interestingly, the homes that he flips have by far the lowest profit margins of anything on any flipper show. But he seems fine with that and runs a good business. Just goes to show you can do things above the board and still make a profit.
Well if she updated the electrical service from 60 amps to 100 and got rid of all the old 2 prong outlets, and the old glass screw-in fuse box, that would still be a recent update.
List of “up” dates: crown molding (yawn), granite anything (yawn), closet organizer (yawn), berber carpet (double yawn).
What’s the big deal with crown moldings? How can some wood molding increase value?
Not only that if you have an air gun and a miter saw crown moldings are so easy and inexpensive to put up it’s not even funny. Nobody knows if the moldings are particle board, or hardwood, and it really doesn’t matter, so I always get the cheapest, nicest looking thing I can get, and it usually just takes me about an hour to put the molding up in a room.
It’s a matter of supply and demand…
The supply of greater fools is running out.
They ain’t making greater fools anymore. I wish
“As foreclosures statewide hit a new peak in March, the city has partnered with the state and area lenders to provide discounted services to buyers of bank-owned property. The home-buying initiative, Buy Brockton, launched this week is the first of its kind in Massachusetts. . . It allows borrowers to buy homes in the city that are bank-owned, in foreclosure or being sold in a short sale without the customary 5 percent down payment.”
It’s so easy, why couldnt I see it? The best way to solve the rising foreclosure rate is to sell to ppl that cant even scrape together a down payment.
Require a 20% down payment and drop the price 50%. That will solve the problem permanently and solve affordibility issues. As I have been saying since 2000, I no longer relate to my fellow man. I see how they vote, how they spend, their decisions, prejudices and reasoning, and just sit back thinking WTF.
I second that, I to no longer relate to my “fellow” man, it seems there are 2 groups in this country those that are awake and those that watch american idol and watch cnbc…
Now, don’t be hatin’, lurker. Give your ‘fellow’ man a chance. Yes, there’re those few awake ones, and for the rest do what I do, ’cause it works super good. First of all, I keep some bright candies in my pockets and I take them out, slowly, so as not to alarm the fellow man person I’m talking to, and I let them sniff my knuckles. Then I use soft words and soothing, easily understood gestures to indicate what I want them to do, repeating the process patiently until they understand. Then, when the desired behavior is achieved, I reward the behavior with more candies– if there are any left after I’ve eaten a bunch as I stand there watching them try to comprehend.
It takes patience and self-control, yes, but it’s quite rewarding personally, not least when I observe their pride in their simple achievement.
I forgot to add: Load up on the bright pretty candies; I’d suggest about a pallet-load. I think I know about 50-60 evolved humans and just about every single other fellow man and woman human person is better served with the candy/soothing word handling.
Nice idea, truth is the only way to deprogram them is to cut them off from the mass media and advertising…
True ppl are so lazy today its disgusting. It used to be the key to wealth was saving, and then investing in undervalued assets when an opportunity presented itself. Now the majority feel that the best way to make money is to see what others claimed to have made money doing and copy it regardless of current prices and historic valuations. Bubble after bubble, after bubble. The stock market is still up, amazing to me.
“Bubble after bubble”: lottery mentality, indicates a real cynicism in the population.
Don’t agree that people are lazy in hours worked, people work a LOT. Remember when people used to have hobbies?
Lazy thinkers? Oh, yes.
My brother in law’s company has showers, a gym, even laundry, plus lots of perks like game rooms and a cafe. The trade off is that people are expected to stay at work all the time. People regularly sleep at cots near their desks, it’s the “culture”. Indonesia, India, China? No. North America. For the sacrifice of an actual life, the guys at this company make enough to pay the mortgage, childcare, and so on with a little left over for junk food and a small pension fund. Their contribution to society is they produce video games. Woo.
My mission in life is not get trapped in that lifestyle. Once you’re in, it seems hard to get out. And I think that is when your only ticket out might seem to be a bubble (dot-com or otherwise).
Speaking of which, my sandwich break is over. Back to work, Lazybones-ella!
Yeah, what a a brilliant idea. Sell foreclosed homes to deadbeats and specuvestors so you can repeat the cycle in a year or two. But hey, it might prop up values until the next election.
Require a 20% down payment and drop the price 50%. That will solve the problem permanently and solve affordibility issues.
I would buy tomorrow if this would happen.
Me too. I sold my house in 2005 and put all the cash into a house fund, and each year have put all my savings from renting into the fund, after maxing out my retirement funds of course. I have a substantial amount of money in the fund, and am willing to buy as soon as we are within historical levels. The truth is I love housing. I enjoy finding deals, renovating, etc. (not to flip but for my own use). I just refuse to be a mark and believe better opportunities will be around the corner in 2010.
Yeah. It drives me crazy that my friends and family don’t see this. They think the long amortization periods and 5% down on offer are there to help them afford something which is naturally expensive. ugh. Credit does not equal affordability.
I cannot wait until being house poor goes out of fashion. My fashion forecast is frugality, though. You heard it here first!
These guys who ripped off these dementia laden seniors have a special place in hell
the level of flat out criminal behavior is stagering
mg…. the theft from fixed income folks has just begun. Watch the reverse mortgage scam come on with a vengeance.
Preach it, Exeter! A dear friend took out a reverse mortgage, then proceeded to go on a truly baffling spending spree.
We’re talking things like a gourmet coffee bean of the month club with a fancy-dancy grinder. And she doesn’t even drink coffee.
Tells me that she wasn’t of sound mind when she took out the reverse mortgage, but no matter. Some sales guy or gal got a nice commission.
RE: Watch the reverse mortgage scam come on with a vengeance.
I’m with ya on that one Big E…
he coming inflation is really gonna steamroll the fixed income crowd.
You can bet the mortgage vultures will be circling.
Reverse mortgages just piss me off. What the idiots that push them don’t tell anyone is that you could do your own reverse with a conventional loan.
1. Take out a conventional 30 year or 15 year mortgage.
2. Make the payments on the mortgage from the amount you borrowed which is getting interest from an interest bearing account (money market, 30 day CD, or an hsbc checking account if it’s under 100K).
3. Take out your monthly living expenses each month from loan that is sitting in your bank.
I’ll bet 99 percent of the time you would be better off doing this because of all the nasty fees that are hidden in the reverse. Not only that you wouldn’t have to deal with the shady element that is preying on the elderly with these.
(note: I think both of these are pretty stupid, if your retired then move into an apartment or rent house that is well maintained, and low on utilities/taxes if you want your money from your house back)
“Though Samakai understands the market has slowed considerably throughout the Lower Hudson Valley, she was reluctant to ask less than the $500,000 that the home first listed at, but has since lowered the price by $15,000, to $485,000.”
It just cracks me up when I see people lower their price by $15k. Her house is losing value faster than that the longer she has it on the market. Saw someone on my block try to sell their home for almost $400k last year. Now they’re asking $265k. By the end of the year when Samaki is still sitting on the house and trying to find someone to buy it for $350k, she’ll be wishing she’d been more generous with the pricing from the start.
If no one comes up with the $485k she will pull it off the market and rent it out until the market rebounds. That’s what greatest fool does these days.
I talked to a realtor about a month ago who had a client who did not want to drop the price on their home. It didn’t sell, so now they’re asking $1500 for rent. And they had a difficult time finding a renter. These sellers seem to have this idea that they can wait out the slump, rent for awhile and then sell for top dollar again in a few years. I suspect though that in a few years their homes will be worth even less, and rent will barely (if even) cover mortgage, much less repairs and taxes and periods of vacancy. And prices won’t be back up to last year’s highs for another 20 years or so.
The “rent it out until the market improves” meme is quite prevalent here in Tucson. And I predict that, once the realities of landlording set in, a lot of these rentals will be dumped back on the resale market at “sell it for what you can get” prices.
No doubt, but I see it is draining the dumb money from the system (e.g., why cut your losses when you can slowly bleed to death), so it’s a positive in my book. They could probably sell for $450k now and buy a similar property for $300k in 2010, but they simply cant think in those terms. Perhaps they will take HGTV’s advice and make those simple renovations that have a ROR of 200% or more. I never really understand it. Once HGTV says the ROR is higher than 100% why dont buyers demand that the renovation not be done in the form of not paying for it, so that they can do it themselves? Especially things such as putting in granite countertops or new tile. You can go to Home Depot and have someone come out and do the job in a few hours. When I look for homes, I will only buy if they dont have renovated kitchens and baths. Who wants to pay some wannabe investor more than 100 cents on the dollar for their taste or some cheap remnants they found?
‘The Bay State’s housing market is looking a lot like it did at the end of 1990,’ said Timothy Warren Jr., CEO of the Warren Group.”
NO - it is NOT. At the end of the last bubble (early 1990’s) - real estate was thought to be the WORST investment possible. Renting was smart. When you were going to buy a house - people looked at you like you were a moron. Ads were all over the place trying to convince people to buy because it was actually significantly cheaper than renting…and people still didn’t buy!
It will be interesting to see if that happens this time around.
If you plan to stay in an area, it certainly makes sense to buy rather than rent in a place you like, even if you pay a little extra, just for the stability bonus. But the Realtors have so lost credibility that no one will believe them.
They have ads on the radio up saying a house isn’t just a home, it’s an investment that on average doubles in value every 10 years. Shouldn’t they be saying that a house isn’t an investment, it’s a home? Shouldn’t they have been saying that all along.
a house isn’t an investment, it’s a home?
Exactly WT !! I have suggested this before but I will say it again…I have “always” felt that “single family homes” should only receive the interest tax deduction “if” the home is “owner occupied”…This would eliminate all “speculation” in home purchases…I know this goes against the grain of business deduction of rental property but their are other alternatives for real estate investment as a business…
If you plan to stay in an area, it certainly makes sense to buy rather than rent in a place you like, even if you pay a little extra, just for the stability bonus.
Though I agree with this, it’s not yet time to do so. Prices are still too high. Much higher than “a little extra”.
Maybe there’s more stability in areas of New England and the Mid-Atlantic, but IMO, there’s not much stability yet in other parts of the country. Seems like every day there’s yet another destabilizing factor, like gas and food prices going to the moon. This does not make for stable neighborhoods and that’s my biggest concern. In some parts of the Tampa Bay area, prices have declined enough to make it attractive for me to buy, but I won’t do it until I see how this all shakes out and that may take another two to three years at least.
I would think that NE will get hammered next winter. After all, if you do not heat the place up, it is rather hard to live here with those dreadful winters. It will be very hard for foreclosed houses to even find an oil provider willing to take oil to a house, and not know when they are to be paid, and most houses have oil heat.
I think that with that in mind, we might be seeing a whole bunch of middle of the night moves as well.
This year is going to be interesting, to say the least.
RE: Maybe there’s more stability in areas of New England
The only thing keeping New England running are the pensions, inflated SS checks, and Medicaid funds for legions of Greatest Gen types.
They keep the health care biz runnin’ and the lawn mowing companies busy.
Everybody else is walking on pins and needles.
To delude themselves from their predicament-most bury themselves in the irrelevant trivia of the local professional sport teams.
But if the Teamsters ever decide to stop hauling food, or the heating oil trucks fail to deliver their Arab Bunker Fuel No. #3-this region is fooked.
“But if the Teamsters ever decide to stop hauling food, or the heating oil trucks fail to deliver their Arab Bunker Fuel No. #3-this region is fooked.”
I’m tellin’ ya, hd, you have a way of cutting through all the BS to the simplicity of the situation. I like New England, I plan on spending a coupla months there this summer, I hope. I hate to see it in decline.
RE: I like New England, I plan on spending a coupla months there this summer, I hope.
Palmetto-Let me know when you’re comin…We’ll go get some Ipswich fried clams and a do a few Shipyard Exports.
Are tax-starved municipalities asleep? There’s still no real movement towards a disincentive for loan servicers (REO Depts?) to let homes go to hell. (Which of course plays hell with valuations and neighbors wanting to stay in *their* houses.)
It had ought to be simple - huge fines for homes staying unmaintained and/or unoccupied, with as swift an end game as possible, absolute auction of the home being the bottom line for recalcitrant bagholders. I did have some hope after reading about a few cities attempting this - did it get shot down in the courts?
And no, I’m not speaking on behalf of keeping bubble prices up; it’s the exact opposite that would benefit me and mine. I just don’t want to live in the Mad Max world of freefall infrastructure defunding that the bubble makers are - with a shrug - letting unwind.
“Samakai is selling her 2,200-square-foot, two-story home because she recently married and will soon move south with her husband.”
No, no, no. Samakai is TRYING to sell her house.
Why did a single person have a 2,200 square foot house? The greed in America is unreal.
Because when you’re buying a house you have to think of eventual resale. What is going to appeal to more people ? A dinky 2 bedroom 1 bath or a 4 bedroom 3 bath ?
It depends who’s looking
“It allows borrowers to buy homes in the city that are bank-owned, in foreclosure or being sold in a short sale without the customary 5 percent down payment.”
No downpayment? Hey! Then it will be more affordable to the deserving buyer. What a great idea, I bet it works out super dooper good!
HAHAHAHAHA! (pause for breath *gasp, gasp*) HAHAHAHAHAHA!
I gives them the opportunity to be a recycle foreclosure.
My oh my… the momentum is pretty amazing and hasn’t yet reached peak velocity.
Wait to buy until people are scared. As others have noted, you’ll see the ads touting its cheaper to own than rent and still J6P will run to the sidelines. That’s when to buy. Just remember the list price is there to be brutally undercut. LOWBALL!
I’m spectating until 2010. I believe 2009 will have the greatest return to sanity. Will there still be downside risk? Yes. So make your own decision when to buy. Just don’t be silly enough to catch the 2008 or 2009 vintage knife. Capitualation has the sharpest national price drops. A few areas might be buyable in 2009… very few.
Got Popcorn?
Neil
“O’Leary has reduced an Easton split-level ranch’s cost by about $200,000 because someone ripped out appliances, sinks, toilets and more. ‘You drive up and say, ‘Wow, what a nice house!’ the broker said. ‘Then you look inside and say: ‘My God, what happened here?’ Short of taking the shell of the house, everything is gone.’”
Where is all this stuff going? Ebay? There are probably some good deals out there.
New Business, find people who are being forclosed on and offer then 1k in cash for everything on the house before they leave.
All over the country, used construction type trucks aren’t selling, pawn shops are hesitant to loan on power tools, but used toilets are still in demand?
There are only three sure things in life: death, taxes, and trips to the bathroom.
Except for the woman that didn’t leave her bathroom for two years.
http://tinyurl.com/2hrw63
I still cannot get over that. Sitting on the toilet for TWO YEARS?! She wasn’t even in the bathtub. A two year long hot bath with the pretty fragrant bubbles and the loofah–that, I can see. That would be totally reasonable. Heck, I’m thinking of doing that myself, as soon as I set up a little beer fridge and a pallet of rose-scented little soaps in there.
Not “used toilets”. “Pre-owned”. With the dollar down we ship these babies all over the world.
“Now Travertine for your shanty at low prices…”
If you’d ever been to one of these places, you would realize what a step up these “pre-owned” babies, or whatever you call them, actually are for a whole bunch of people.
I’ve gotten some really great deals on CL lately for designer fixtures, appliances and top-grade building materials (ie, 10 cents or less on the dollar). I never asked where it came from…
mission acCOMPlished
“There were two cars parked in front of 144-146 Prospect St. Friday morning; one of those cars sported a bright red banner that said ‘AUCTION.’”
“About 90 seconds after the auction began without even the clap of a falling gavel…there was a single bidder at the sale. The mortgage holder, LaSalle Bank NA, purchased the three-family home for $101,250. ‘They need to protect their interest,’ said Ronald J. Marcella, an auctioneer from Dalton who represented LaSalle at the sale.”
I follow the foreclosures around Middlesex county, MA.
Duetsche Bank stands out as a leader in buying back foreclosed properties. I can’t recall one instance where DB has sold a foreclosed home to someone else. They always end up buying it back.
“‘Some of the new products . . . had a lot of moving parts,’ says Evan Wagner of IndyMac. ‘For people who got these loans that weren’t really intended for them, it’s kind of like taking a medication that isn’t intended for what it’s meant to do, and sometimes there are bad side effects.’”
This guy really chaps me, why is he blaming the borrowers here? His company paid a premium to buy these types of loans. Dude, when you loan money and don’t bother to do enough due diligence to get paid back, you deserve to own many more POS properties, lose your a$$ and your job. How do you like those bad side effects?
Perpetual Peak Pessimism
“‘We hope that represented something of a peak, but March’s numbers have shown us that Massachusetts’ foreclosure problems continue to worsen. With steady increases in petitions, I don’t see this problem going away any time soon,’ he said.”
As a resident of the lower hudson valley I can tell you there are gonna be hundreds if not thousands of McMansions in forclosure here that nobody will want..There is a huge toll brother comunity with condo’s for 280, townhouse for 350+ and Mcmansions for 550K and up, the medium income was about 50K here, and inventory and forclusures are increasing dailly, I anticipate half the sold units of the in this toll brother monstrosity to go to forclosure, the remaining one will stay vacant and the condo’s which are’nt not even 100 percent complete to not be completed as TOLL in general files for BK….
Lurker, Even Lennar has speculated in Dutchess Co. They got a cheesy Shack City called “Plum Court… from the low $500,000’s” according to a billbard on RT55 in Lagrange. Our church paid for some demographic study and it shows the median income for households in and around Lagrange to be 45k and combined 86k for head of household and spouse. 86k isn’t gonna float a 500k note no matter how you subprime it.
yeah but Dutchess has always been the bedroom community for Westchester jobs who don’t want to pay Westchester housing prices. What happened other than overbuilding too many McMansions ?
Actually Dutchess has only recently become a bedroom community for westchester/NYC right about the time the housing bubble began, poeple cashed in the equity on there normal sized house in westchester selling to some greater fool down there and that equity into 600k McMansions in dutchess, but that game is over…
“What happened other than overbuilding too many McMansions ? ”
You’re joking right? 80k/yr wage slaves signing up for 600k notes isn’t a problem?
“86k isn’t gonna float a 500k note no matter how you subprime it”
Good call
New business idea: a McMansion chipper. Produces cow paddy sized granite/pergo/drywall pellets great for mixing with asphalt to patch potholes.
You must be one a them geniouses!
Yup, that’s me! always thinking outside the stuccoid box.
Well up a bit further north there’s a market that for the past 2 years has barely hit 4100 listings at the end of the season and that’s because they get too lazy to clean out the “SOLD”s. Usually once they clean up the list, it goes back down into the mid 2000s.
Well it is just the beginning of the season, still being only April. One local listing website now stands at: 5234
One disclaimer is that homes are sometimes listed multiple times if they want it to come up under different town searches. (Doesn’t happen that much) I have seen quite a few solds in the last week too. ( I guess these buyers want to beat the rush before credit starts drying up.)
Hey greater fools, why even bother wasting your money to buy or rent these Fb’s houses when you can rent the documented registered luxury “Moneypit” in the south of France?
http://www.ed-hamilton.com/yacht/Moneypit~4026.html
These moneypits EVEN come with lifejackets
“But the agent also recalls one case where a foreclosure ‘victim’ had two new SUVs, a 25-foot boat and a 45-foot motor home parked in the driveway.”
“‘That’s not victimization,’ O’Leary said. ‘That’s setting your priorities wrong.’”
One case=75% of ‘foreclosure victims.’ Let’s call a spade a spade.
How many of them didn’t have a nicer TV than what I use?
How many didn’t liberate equity or buy ‘investment property.’
Got Popcorn?
Neil
I am not so sure that 1 case = 75% of foreclosures. How many had to do with job losses, medical expenses or divorces in families that relied on 2 incomes to make mortgage *and* food, insurance, gas? If the problem was just stupid overspending, this would actually be less of a crisis, no? (since people could stop overspending). The fact that so many people are comitted to long term payments on something they cannot afford (ie a house) strikes me as the real crisis.
Maarketplace this morning is reporting that the average taxpayer will spend 70% of their tax rebate paying down debt.
In 2001 the Consumer Bankruptcy Project (a Harvard University-based research group that has studied bankruptcy over the past 15 years) found that job loss, medical problems or divorce were the reason behin 87% of bankruptcies. All other reasons (including overspending accounted for only 13%. Not 75%…In fact discretionary spending is down on average from 30 years ago.
People are stretched too thin on basic neccessities…especially housing and housing-related costs. A lot of people have to face up to the fact that they can only afford a little rented apartment. The they can get a really nice tv to put in it, even two
I am not sure why you are relying on constants such as illness or divorce to explain deviances. Constants are irrelevant. The fact really is that simple. People paid crazy prices, much above historical norms, at prices they couldnt afford. The result is that things that would normally be relatively minor such as paying more at the pump or for heating push ppl over the limit. As far as inflation of energy and food costs, that is a very low % of most ppl’s income. Housing costs have always been the elephant in the room. If ppl always put 20% down when buying a house, always got the 30 year fixed, refused to pay more than historical norm prices, didnt buy until they had a years savings stashed away, and only bought what they could afford, it would be smooth sailing.
“People paid crazy prices, much above historical norms, at prices they couldnt afford. The result is that things that would normally be relatively minor such as paying more at the pump or for heating push ppl over the limit.”
This is what I said. I didn’t even mention inflation. What are you disagreeing with?
I guess the way I view it, whether you buy a fleet of SUVs and a plasma TV for every room, or pay $500k for a $200k house, its still over-consumption. I read your post as implying that housing is a necessity and that ppl had to pay market prices at the time. If that wasnt a premise I apologize. I get mad sometimes because I hear so many ppl talk about they didnt want to pay high prices, but that was market at the time. All they had to do was say hell no and rent and none of this would have happened.
Oh, I see what you mean. No, if you can’t afford it you can’t afford it. Food is a necessity, but you should eat lentils if you can’t afford steak.
What I was trying to get at is that if the average debtload was based on spending on lots of smaller luxury items, then it would actually be less of a crisis. Those are the type of things that you can buckle down and pay off, at least in a few years. People have just shackled themselves to a long term payment they can’t afford or worse, borrowed for luxury items against borrowed (mortgage/equity) money.
People’s finances are so fragile, that anything life throws at them knocks them over. So, constants, like divorce or illness lead to bankruptcy, when they should have just led to hardship.
A couple of years ago, I read a bunch of popular personal finance books, just out of curiosity. A lot of them, like the automatic millionaire, encourage/frighten the reader that they must own a home to attain financial security, something which is gospel among almost all my friends.
A common financial plan around here is: buy house for 3/4 million, cut back on everything else. As if cutting back at starbucks and best buy is going to bridge the gap! So many of my friends are actually very frugal, except for their mortgages. Take the mortgage out of the equation…you’re solvent, it’s simple. However, I may as well throw myself on the floor and start speaking in tongues for all the good it does me to say this to anyone I know!
(”The Wealthy Barber” and “All Your Worth” were the notable exceptions in the finance books, bye the way. They both say don’t buy a house if you can’t afford it).
Also, I point out that, since the study you are relying on came out in 2001, it was based mainly on pre-bubble data and not particulary relevant. Not to mention that if ppl lived within their means they could handle temporary job loss or divorce. Also you make a distinction between “discretionary spending.” Why isnt paying more than historical norms for housing discretionary spending, or why do you not deem it relevant? Economists play games. You dont have to believe their conclusions. Always ask yourself if it makes sense.
I do ask myself if it makes sense. I look around me (at my friends) and see that people are overleveraged in mortgage debts and student loans. Not fancy shoes, not luxury cars, not flat-screens. Maybe your friends are different and are blowing all their cash on new barbecues or something. Mine aren’t.
I didn’t say that people were living within their means (bankrupties are up and up, so they obviously aren’t). I am saying that I don’t believe that 75% of people in foreclosure are there because they bought too many fancy tvs and cars, but rather that the big expenses in their life (mortgage being the big one) is the problem.
Once people sign on to pay way too much of their income over for 30 years, they are totally doomed. They would have been better of renting somewhere they could afford and buying the fancy tv. Pretty basic, and not exactly an economic game.
That 2001 study showed that people are financially unstable due to basic expenses, such as shelter, taking up too much of their income, leaving not enough for saving or a rainy day. With increased home prices, that study is more relevant, not less, in my common sense opinion.
RE: people are overleveraged in mortgage debts and student loans
Now, now…somebody has to pay for CountryScam’s CEO’s $100k severence and that UCal police chief’s $2.1 million pension.
That makes sense. Sometimes I seem rude in my emails, but I dont have that intent. I guess the only thing I have a problem with is that ppl felt they needed to pay inflated prices for “shelter.” Rents have not gone up significantly and renting is always an option. I make a very good salary and rent. Its not you, but I get so mad at ppl that felt they had to pay those prices. Just say no. I want a house, but have said no the last three years. There are many reasons that ppl pay inflated prices, shelter is not an excuse given the rental option.
Oh, you didn’t seem rude, you seemed mad. With good reason, the whole thing is…maddening! I really dislike feeling as frustrated with my family and friends as I do.
I saw up-thread that you sold in 2005 and have been saving ever since? Well-done. That’s impressive.
Thanks but I cant take all the credit. I moved from Atlanta to Denver in 2005 so had to sell. I purchased pre-bubble and wouldnt have sold if I didnt move. I did, however, make the decision not to buy after looking at several houses in Denver after the move though because prices didnt make sense to me. I wouldnt spend 500k or more for a house unless it was my dream home. What I saw around that price didnt even come close, and there wasnt anything below that level that would be more satisfying than an intown apartment where I could walk to work.
Ran into some old acquaintences yesterday and they were inquiring what we were paying for rent.
They wanted to know what we were paying because they wanted to rent out the home they regretted buying at the peak.
When I told them we were paying 1500 for 2200 sq ft, they seemed pleased. That was until they realized they got the numbers backwards and I wasnt paying 2200 for a 1500 sq ft.
I dont envy their position.
Prices for Massachusetts single-family homes plunged nearly 11 percent last month
No they didn’t. They plunged 11 percent in the year ending last month.
Can’t the newspapers even find people who can write English property?
No, they can’t. Here’s an actual headline from Tucson’s Arizona Daily Star:
Phoenix College football played shot to death
It’s in the online edition under “Latest Updates.”
Man, I hate playing “shot to death”, that game is brutal.
It’s better than the dolt on WUSA tv9 last week who said that home prices were at their lowest in 18 years. You’d think that some sort of reality check would have clicked inside her head, and she would have corrected herself by saying that the sales rate was the lowest, but nope, she kept on blabbing away.
It’s not the first time she’s done that (she’s known as ‘the dumb one’ in our household). I remember a year or two there was a news blurb about the Air Force testing a drone that went 5 times the speed of sound. Except that she said it ‘5 times the speed of light’. No pause, no double-take, no correction.
A drone moving at 5 times the speed of light would be useful if stuck in a game of “shot to death” I think!
Er, “properly”, and that was a typo, not a usage error.
The projected increases in state and local property taxes should really endear the existing house taxpayers to these financial recreational “Investments” such as flipper houses, SUVs, boats and RVs
RE: “The number of foreclosure deeds filed in Massachusetts rose to a new peak in March when 1,167 foreclosures were recorded, according to The Warren Group.
What Mazzhole’s worry?
Neiman-Marcus is coming to town!
Peasants…
On the way up, economists and investors love the multiplier effect. On the way down, they just don’t want to take it into account.
Needing to pay back taxes, the couple at that time sought to refinance their fixed-rate mortgage
They bought in 1986, re-fi in 2004 with Countrywide in 2004 with a “promise” to refi (into WHAT?). Then the nut jumps from $1600 to $3500 per month. That’s a whopper worth of cashing out for “taxes.”
No bailout for you. Sell the $hit and walk.
No bail-out for you!!
AZ lender and other banking types -do you a simple formula for defaults vs spread in order to make a profit ?
tia
Went looking for a dresser for the kid over the weekend. The wife and I like oak, so we went back to the place we bought our last dresser from. We pulled the receipt before we left. We paid $211 for a nice 5 drawer dresser. Nothing fabulous but pretty decent.
I was curious to see what prices are for these guys, since they expanded at exactly the wrong time and had to close a 2nd location about 1 year ago.
We walk into the store. There were about 4-5 cars outside, but the place was pretty dead. We were jumped by a salesman about 5 seconds after entering. We start looking around and were shocked by what we saw.
That $211 dresser was now about $700. I actually saw dressers well over $1,000 and this was for average crap. Of course we walked right out the door (with 2 other couples that didn’t buy).
So what is going on here? Did their cost really go up like this? I suspect no. What it looks like to me is the company’s sales volume has dropped so much they are trying to make it up by gouging current customers. Which makes me wonder about the idea of inflation in the first place.
Inflation seems to show its ugly face during recessions. Is inflation really the increased cost being passed on to the consumer? Or is it the impact of falling sales causing company to jack up prices to try to maintain their top line? In this case, it appears to be the latter.
It appears that when sales falls it’s time to start screwing the customer. I fully expect to see these guys going out of business.
One more thing. On the front of their building they have a giant sign that says….God Bless America.
How pathetic. Sales go down so they go for the trusted “God Bless America” line get people to come in. LOL
One more thing. On the front of their building they have a giant sign that says….God Bless America.
I’ll bet their furniture is made in China.
Is it possible they got used to inflated prices during the housing boom, when people would borrow against their houses for furniture (or at least convinced themselves that things they bought which were related to housing were “investments”)?
Will you be blessing Sweden or the Sally Ann?
Here’s a letter to the editor from the president of the Home Builders Association of Massachusetts. Dated last month. In March it was different here.
http://tinyurl.com/6m3zhe
The up side of buying a home
Potential home buyers would do well to consider how the Massachusetts market is different from the rest of the country when making their decisions about when to buy (”Is now the right time for potential home buyers to make a deal?” March 4).
Much of the excess home inventory is actually in other states. In fact, Massachusetts has seen half the new building permits during the recent boom, as it did in the 1980s.
Current low interest rates, coupled with higher FNMA/Freddie Mac limits, mean that more affordable rates will be available to those buying higher-priced homes, all resulting in reasonable payments after initial price declines. Those same low rates may not be here a year from now.
Any true home buyer should have at least a three- to five-year residency horizon. Given that we are closer to turning the corner on this down market than plunging into it, price adjustments for buyers now mean reasonable sale prices later.
Finally, a home is not just an investment, but a place to live. Building equity instead of spending savings on rent, tax advantages, and the satisfaction of a controlling your own living environment remain the true advantages of home buying, regardless of the market.
Mark H. Leff
President, Home Builders Association of Massachusetts
Sigh, I’ll try and re-post this. Looks like it got eaten somehow…A letter to the Boston Globe from the president of the Mass. Builders Assoc. We were turning the corner and Massachusetts is different anyways…As of last month.
http://tinyurl.com/6m3zhe
The up side of buying a home
Potential home buyers would do well to consider how the Massachusetts market is different from the rest of the country when making their decisions about when to buy (”Is now the right time for potential home buyers to make a deal?” March 4).
Much of the excess home inventory is actually in other states. In fact, Massachusetts has seen half the new building permits during the recent boom, as it did in the 1980s.
Current low interest rates, coupled with higher FNMA/Freddie Mac limits, mean that more affordable rates will be available to those buying higher-priced homes, all resulting in reasonable payments after initial price declines. Those same low rates may not be here a year from now.
Any true home buyer should have at least a three- to five-year residency horizon. Given that we are closer to turning the corner on this down market than plunging into it, price adjustments for buyers now mean reasonable sale prices later.
Finally, a home is not just an investment, but a place to live. Building equity instead of spending savings on rent, tax advantages, and the satisfaction of a controlling your own living environment remain the true advantages of home buying, regardless of the market.
Mark H. Leff
President, Home Builders Association of Massachusetts
Tim and ella, I’m rudely jumping into your discussion, which I found interesting. I would like to add the following observations:
Ella is absolutely right that the majority of bankruptcies in the U.S. are due to medical bills and job loss, not to overspending on lattes and designer shoes — in fact, medical payments constitute the greatest (3/4, I believe) of reasons for bankruptcies. And the really shocking part of this is that the majority of those people who filed bankruptcy for medical reasons HAD health insurance!! Our health system is so unbelievably fracked in this country that I despair that we can ever get it fixed, but it is a far bigger crisis than this manufactured “housing crisis,” which is only a crisis to people who bought way over their heads and/or greedy would-be sellers.
Another thing, Tim, is that when it comes to housing, even people who rent have to spend an inordinate amount of their income on housing. Rental increases may have stalled now but for a while they were soaring like housing prices, to ridiculous heights. The building I first moved into in my area, I rented a 2Br for $800 a month — a fantastic deal around here. Currently the exact same 2BR goes for around $1400 a month and this is only eight years later!! When my rent got to $1000, I said “this is insane” and I moved out; I was darn lucky to find my current dirt-cheap rental through a friend. And the city I work in is even worse — someone I know just rented a place in the city and the best deal she could find was, IIRC, $1800 for a 1br. Yes, that’s a lot less than “buying,” but still, these are just unacceptably high percentages of income that people have to pay for housing.
It’s also true, as some of you have noted, that people have an inflated sense of what they “deserve” in housing. People envy my cheap rent but most of them would–and do–turn up their noses at my neighborhood. (It’s not dangerous or hideously ugly or anything, in fact it’s charming imo; but it’s old and unfashionable and working-class in an area that has become granite-counter heaven). I’ve had two people tell me they would “never” live where I do because it’s “trashy.” (The amusing part is that one of them has been living with friends for a year because she can’t find anything affordable and the other is working two jobs to keep her HELOCed-out roof over her head. Oh well.)
Thanks for your insight. I dont disagree with anything you said. I am all for national health-care. Not only do I think it is socially a better choice, I want to retire early but have some health issues which worries me. So even those that worked through grad school and worked 50+ hours a week at high pressure jobs are scared. Its and issue that can effect anyone.
Sorry if I rambled or sounded argumentative, didn’t mean to.
You’re right, nobody is safe from health worries, and it is a shame that people can get to the end of a hard-working, productive career and be scared of being bankrupted by medical costs.