Even When There’s No Money, There’s Still Evil
The Herald Tribune reports from Florida. “Martin Caparros was late to the party with his Vintage Grand condominium conversion project, but his sales team still managed to sell 238 units for a total of $43.4 million from January 2006 to October 2007. It turns out, however, that part of the Miami Lakes developer’s success can be attributed to market-distorting rebates and enticing mortgages that his sales team offered to buyers as incentives in late 2006 and early 2007.”
“The rebates, which ran as high as $35,000, distorted the market, analysts and appraisers say, because sales prices were recorded at $235,000 and banks lent money against that value, while buyers were only paying $200,000 to $215,000 for their units.”
“‘When a bank forecloses after one of these deals, it is instantly upside down on its loan,’ said Dennis Black, a Port Charlotte appraisal instructor. ‘Its customer owes more than the property is worth.’”
“That was certainly the case with nine loans secured by Tampa real estate investor Michael Chadwick. In late February and early March 2007, Chadwick’s Sarasota real estate agent, Pat Brester, bought nine Vintage Grand units and immediately resold them to Chadwick at much higher prices, enabling the Tampa investor to get loans that exceeded original purchase prices by nearly $90,000.”
“Chadwick’s Sarasota real estate agent, Pat Brester, bought the nine units for $1.91 million from Feb. 26 to March 13 last year and sold them to Chadwick for $2.22 million on the same days they were purchased.”
“Chadwick then got two loans from SunTrust and seven loans from Fifth Third Bank, totalling just under $2 million, or nearly $90,000 more than Brester originally paid for the properties.”
“Together with the rebates offered by Vintage Grand, Chadwick was able to walk away from the closing table with about $360,000 — money Chadwick said he used to make interest payments on his loans.”
“‘I could not have carried the properties otherwise,’ he said.”
“When the money was gone, Chadwick filed for bankruptcy protection, listing $3.04 million in debts and $2.095 million in assets.”
“His nine Vintage Grand units were valued at…an average of $139,000 per unit — a far cry from the $246,400 Chadwick said paid for the units, and the $221,755 per unit he received in loans. ‘All in all, it was just a bad real estate decision,’ Chadwick said. ‘I didn’t know how bad the market was going to get.’”
“Julie Bartlett, a California real estate investor…helped Vintage Grand with its marketing efforts. Bartlett thought the deal was so good that she convinced her father to buy a unit. But she is now regretting that decision.”
“‘The units are worth $100,000 today and we’re buried in interest payments and condo fees,’ said Bartlett, who took over nearly $2,000 in monthly payments from her father a year after he bought his unit. ‘We’re getting to the point where we either have to find a short sale or give the unit back to the bank.’”
The News Press. “Welcome to ‘the courthouse steps,’ a corner of the second floor of the Lee County Courthouse where the county clerk’s office holds auctions every weekday in cases where a judge has ordered that a piece of property be sold to satisfy an unpaid debt. It’s a busy place, and on the brink of getting a lot busier.”
“Judges in March ordered 521 properties sold - more than 19 times as many as the 27 from March 2006. Lee Clerk of the Court Charlie Green said he’s about to step up the auctions, which disposed of more than 70 properties one day last month. ‘We’ll have days in the future when we’ll have two sales,’ Green said.”
“What’s frightening is that a huge backlog of foreclosure cases is building up and needs to be dealt with: almost 16,000 were still pending at the end of March, he said.”
“Back in the heady days of the real estate boom that ended in late 2005, there were buyers aplenty at the auction, said David Hall, president of First Community Bank of Southwest Florida. ‘They were buying into a buying frenzy,’ he said.”
“But now there’s a glut of homes on the market, Hall said. ‘There’s just so much property out there.’”
“Thomas Bruzzesi, who has been a real estate investor since 1989…once watched an inexperienced bidder triumphantly pick up a house for $12,000 and later realize to his chagrin that there was also a $168,000 mortgage on it — the bidder’s money was down the drain.”
“Ed Bonkowski, a Fort Myers-based real estate broker, did a lot of business in foreclosed properties in the early ’90s in the last major downturn but said he hasn’t lately because good deals are ‘few and far between.’”
“He expects that will change eventually, as foreclosure sales accelerate and bank-owned homes pile up. ‘Our decision to buy’s going to be when the banks are ready to bulk sale a bunch of them, then it’d make some sense,’ Bonkowski said.”
“But prices will have to drop steeply for that to happen, he said. ‘At 15 cents on the dollar, all those properties will be gobbled up, investors will come out of the woodwork and buy them and everybody will go back to work,’ Bonkowski said.”
The Republican Eagle. “In these harsh times, when a builder goes broke, the financial hardships, much like the would-be homes, have only begun.”
“Vincent Santanelli was delighted when his elderly father-in-law told him he planned to purchase a home at Cascades at Groveland, a Florida retirement community west of Orlando.”
“Still under construction, the property was a short distance from Santanelli’s own Groveland home and was reasonably priced – a rare find in central Florida’s tight housing market. Best of all, Santanelli says he felt at the time, the home was a product of Levitt and Sons, a Ft. Lauderdale-headquartered building giant with a solid reputation for high quality and service.”
“With some financial help from Santanelli, the father-in-law placed a $20,000 deposit on the home and put the Cozumel duplex he lived in on the market. He quickly received a couple of offers and was about to sell when, in November, the retired senior and his family learned that Levitt and Sons had filed for bankruptcy.”
“‘We’re still waiting to find out if Bank of America is going to take over the development so we can get the deposit back. My father can’t sell the Cozumel home, and now that the value of it has dropped because of the market, he’s looking at a bigger mortgage than he’d anticipated. He has no idea where to turn next,’ says Santanelli.”
“Santanelli and his family aren’t alone in their predicament. When Levitt and Sons filed for Chapter 11 bankruptcy protection Nov. 9 after defaulting on $181.5 million in debt, hundreds of customers who had shelled out unsecured deposits were suddenly cast in financial limbo.”
“Debt-holders like Santanelli’s father-in-law have to get in line with everyone else — homebuyers, contractors, everyone — to who the bankrupt company owes money. To get a sense of just how long that line is in Levitt’s case, more than 650 liens were filed against the company in St. Johns County, Fla., alone within days of the bankruptcy.”
“‘We understand that many of our customers have experienced financial and other distress as a result of our bankruptcy and the catastrophic and unprecedented downturn in the residential real estate sector in Florida and beyond. We have endeavored to be as sensitive as we could possibly be to our customers, and we will continue to do so,’ (stated) Levitt lead bankruptcy attorney Paul Singerman.”
“That the company has tried to be sensitive to its customers’ plight is a statement Levitt homeowner Dan Wenk strongly disagrees. Toxic mold and water damage in his Clermont home near Groveland…he claims made his home unlivable and that Levitt has refused to address. Wenk says his battle took on new urgency in August 2006 when he was diagnosed with leukemia.”
“‘I’m not blaming Levitt for my illness, but I’m saying, ‘Hey, I can’t live in the home you sold me, and you haven’t done anything to fix the situation,’ says Wenk, adding that he and his family had to rent another home in which to live.”
“‘I hired an attorney, and when we finally sued Levitt, it was about the same time that I noticed…they were reorganizing their stock. Levitt requested an extension for responding to the points we raised in the suit, then they asked for more time. Then, I found out they had filed bankruptcy,’ he said.”
“Wenk says that the cost of his now-stalled lawsuit, medical expenses and the burden of maintaining a second home pushed him over the financial edge. ‘Because of this, I’m having file for bankruptcy now, and my mortgage company had to foreclose on the Levitt house.’”
The Tampa Tribune. “Karen Mateson recently approached the Career Central vehicle parked at Pasco-Hernando Community College with cautious curiosity. She glanced through the back door of the mobile job center and, a few minutes later, was looking for jobs in the medical field with the help of Dave Hamilton, the mobile unit’s driver and operator.”
“Mateson, an artist at heart, is enrolled at PHCC’s Dade City campus working toward a degree in radiology. She’d like to teach art, but will settle for a job doing sonograms. ‘It’s not my passion,’ Mateson said, somewhat sheepishly, of the medical field.”
“Hamilton helps dozens of people like Mateson every week as he pilots Career Central’s mobile unit around the remote corners of Pasco and Hernando counties. ‘It’s not about finding a career right now,’ Hamilton said. ‘It’s about finding a job.’”
“The bursting housing bubble cost Pasco more than 1,000 jobs between the summer of 2007 and the same period a year before. The decline put Pasco County firmly in the middle of Florida’s 22 largest counties, with half seeing smaller declines or job-market growth and the rest - most of them in the southwest corner of the state - sharper declines in their job markets.”
“Pasco, which ranked first in job growth among the nation’s 329 largest counties in early 2005, now ranks near the bottom.”
“The bulk of the job losses happened in the construction industry as builders dramatically curtailed projects in response to slumping demand. Many of those unemployed construction workers are finding Hamilton’s roaming job center. ‘Unfortunately, I don’t have construction jobs to pick from,’ he said.”
“During one of those visits to Land O’ Lakes that Russ Wilson stopped by the mobile job center looking for work. Wilson, 32, was a truck driver until the cost of fuel forced him to give that up. Now he lives with his wife and two children at his mother-in-law’s house just north of Land O’ Lakes High School. He works odd jobs and his wife cleans houses to make ends meet.”
“‘Nobody’s hiring,’ Wilson said. ‘I couldn’t even get a job as a dishwasher.’”
The Tallahassee Democrat. “The day the Legislature convened its 60-day, 2008 session in a flower-drenched Capitol, the average price of gasoline in Florida was $3.25. It shattered an all-time record, $3.62, on Friday, the last day of session.”
“For the 60 days in between, lawmakers steered the ship of state while spiking gas prices and paralyzed housing starts gripped the throat of a tourism and growth-based economy.”
“Republicans at the helm kept one eye on a fuel gauge that showed tax collections on fumes and another on the approaching storm of the November elections. The result was a $66.2-billion budget with more than $4 billion in spending cuts targeted largely at school children, the sick and the elderly. It was a year like no other.”
“‘It’s never been this bad,’ said Florida Education Association Attorney Ron Meyer, who has been lobbying in Tallahassee since the early 1970s. ‘Money is the root of all evil, but even when there’s no money, there’s still evil.’”
“The teachers’ union thinks Florida is so off course, it’s preparing a massive lawsuit. ‘I can’t imagine that such a small reduction, coming on the heels of eight years of historic funding increases, would ever lead anyone to contemplate such a thing,’ said House education committee chairman Joe Pickens.”
“Some 40,000 Floridians who rely on two Medicaid programs, Medically Needy and Medicaid Aged and Disabled, got a one-time reprieve when Republican leaders agreed to take $350 million from a state reserve fund.”
“But the same budget also includes language that sunsets the programs next year, meaning they will go away unless lawmakers act. And that decision may rest largely on the health of a nearly $1-trillion economy over which the Legislature has little control, some experts say.”
“‘Obviously, the state can’t turn the economy around, they don’t have the power to reduce interest rates or lower the cost of a barrel of oil,’ said Orlando economist Hank Fishkind. ‘But they can do little things. The Senate had a plan to speed up construction projects, but unfortunately, the House did not agree. I wouldn’t say Rome burned while they fiddled, I’d say Rome burned and all they managed to do was evacuate the barn.’”
‘Pasco, which ranked first in job growth among the nation’s 329 largest counties in early 2005, now ranks near the bottom. ‘Nobody’s hiring,’ Wilson said. ‘I couldn’t even get a job as a dishwasher.’
Notice the serious bubble zones are now having employment problems worse than Detroit. (Like OC, CA) This complete lack of available jobs was what we experienced in Texas. You idiots in Washington can worry over balance sheets and house prices all day, but we just had the biggest real estate mania in the history of man, and nothing you can do will prevent a correction.
There is, however, a huge need for leadership regarding the future of the economy. Who’s gonna step up?
we raised marginal rates and “renegotiated” tarrifs in 1930
And guess I will be the brunt of this joke,…Illegal immigrants…
When the “rubber hits the road”, I would not want to be in the USA, if I was here illegally. Now, the “the war between low earning Americans and low educated illegals begins”.
So who do you think will win this war?
Don’t know about the winner, but the loser will be 98% of Americans. The illegals can always go back home; the locals will be stuck in a post-collapse empire.
Perhaps the winners will be those who buy up the US at 10 cents on the dollar.
But we only lost 20K jobs last month…..
Oh.. wait. We lost 300,000 full-time, decent wage jobs and created 280,000 part-time jobs with lower wages.
Why does Wall Street act as if all jobs are equil?
http://www.voiceofsandiego.org/storyart/jobgainslosses0308.jpg
It’s not just full time versus part time. It’s also in what sectors jobs are being lost or gained. In the case of San Diego County, the jobs added pay less than half of those lost. Although the net loss of jobs is small so far, the loss of wages is much greater.
I’m not advocating a candidate, but I believe Obama is the only person who hasn’t been tainted enough to look ‘outside the box’ for new solutions. What’s clear is that the same thinking that created the problem cannot be used to solve it.
60% increase in cap gain and div rates
that’s outside my box
Or, another way to put it, without your spin, is that he wants to reset the capital gains tax back to what it was, 28%, at least for those making over $250k per year.
I actually like the ‘increase’ in capital gains, at least for short-term gains of less than 2 years. That would discourage folks from trying to make money by cooking the books for a quarter or two, or by making money off of short-term fluctuations, and instead would encourage folks to make money through *investing*, as opposed to speculating or creative accounting.
On the other hand, I would keep taxes on dividends at their current rate. Again, this is to encourage folks to invest for the long-haul and discourage speculating.
I’d be mighty concerned over the definition of “making over $250K per year.” I remember reading how Hollywood types have so many loopholes that they show nil income, which is how the writers of books on which movies are based often get screwed. And what about all the people who create “foundations” and live off those? I suspect that the sorta-rich would get hit and the uber-rich will escape.
What would be so wrong with taxing capital gains income the same as wage income? Those who make money off their money get taxed a higher %, while Regular Joe is still encourage to invest, because he makes so little cap gains (less than 10K), he probably won’t have to file the 1099-DIV at all. If that doesn’t bring in enough revenue, perhaps just make the capital gains scale steeper than the wage scale.
I’m not advocating this; I just want to know if there is some fundamental problem with it.
There is a fundamental… uh… I hate to call it problem, more like a “function” involved in that. The formula is a bit dynamic, not linear/static, and doubling the tax rate won’t get double the tax revenue. Here’s why:
If the cap gains tax is too steep, then people can and *DO* avoid selling in many cases, and they let their investments sit in sometimes-unappealing investments instead of taking the tax hit and moving on to the next investment.
Even at currently low tax rates, I still see some of that amongst older relatives who don’t want to pay taxes on huge profits they get because they bought their house/ stock/ whatever at a very low cost basis decades ago. Same for lots of stock investors.
And so since they don’t sell, and there’s no transaction to tax, the Treasury can end up literally with LESS money overall from a higher tax rate, even though the (fewer) who do opt to sell (and thus pay cap gains tax) individually pay more.
But wouldn’t the tax end up being paid in the end, since eventually a sale has to happen? Doesn’t the change in tax rates only promote earlier transactions, or later transactions in the case of increases? Well…
Ignoring the “stuck by choice in an unappealing (or mismanaged) investment” part of it, there’s this: If my grandmother sits on her stock and her property till she dies, then there *IS NO* capital gains tax (and cost basis is reset for heirs). She’s not rich enough to get inheritance tax either, even after 2010. And although she’s already sold some things off and paid a grudging 15%, at 28% she’ll hang on to the bitter end, and the government gets nothing.
Hopefully that helps clarify it a bit.
OH please he is a left wing hack. Why do you think as a Harvard grad he hung around the anti-american nutjob for 22 years? Answer: so he could get in with the left wing crowd in south chicago. His “solutions” will look like Barney Frank on steroids.
What an image!
Barney Frank (gay) on steroids!
Probable result will be worse than Perot’s “giant sucking sound”.
Like most Fundies, long on criticism and short on solutions.
BP,
nice one,do you work for Hillary? She’s now the working class candidate,with her 109million in income over 8 years, and no real estimate on her total wealth, much of it in Cayman Islands accounts.
Obama has a way of communicating the fact that those who voted on God, gays and guns over the last 30 years in lieu of their wallet got duped.
Duped - as they deserve.
Yea, and that way of communicating that fact pisses those exact same people off so there is no way he will ever get their vote.
He won’t get their vote, so they’ll save it for a “values” candidate like George Bush…plain folks who they relate to over a beer, but who sure know how to f*ck up a country worse than if he set out to do it intentionally…
Disgusting.
You vote your way, I’ll vote mine.
vote whatever way you want as Mr. Diebold will have the final say.
Here in Florida, electronic voting machines are banned except for some handicapped people use. Paper trail is required.
A paper trail is not the same thing as paper, unfortunately.
Of course they were duped, but isn’t the problem that there’s not much of a choice? Both parties put up elitist puppets, with a globalist, corporatist agenda.
The other thing is that Joe Sixpack voters may feel that at least they weren’t thrown in jail, which, for example, seems to be the goal of some on the left regarding fans of the Second Amendment. Hillary certainly gave me that feeling in years back, before her new-found respect for hunters.
“Notice the serious bubble zones are now having employment problems worse than Detroit.”
Being from Detroit I can tell you that the Palm Beach County job market isn’t even close to that level yet. The people in the most trouble are those who work in the construction business. Since Palm Beach County is our largest employer and takes a great deal of the qualified workers, businesses such as mine still struggle to find qualified employees.
–
“Who’s gonna step up?”
You mean someone good (honest and capable) would have any chance in a bad system? We got a choice between three incompetent demagogues, inny, minny, mainny…
Jas
Cynicism is what some people fall back on instead of thinking things through. If politicians are focusing on non-issues and the man on the street is hurting, eventually someone will address that and win support, even in an imperfect system.
If your looking to Washington to fix your problems no matter who is there you are fscked. Look to yourself to fix your problems, and let those who look to Washington get their Katrina style help.
I agree that more people should look inwards for solutions to their own problems, but what actually happens is local/state/feds just HAVE to intrude to show who really has the power.
there are so many ways to run afoul of the various govt regs that most independant minded people just say ‘eff it’ … whats the point of bootstrapping when greedy, lazy, undeserving people seem to always get free handouts and wind up just as good/bad as those who work and play by the rules all their lives?
our system has evolved to feast off the labors of the working class, to pay for the foibles of the poor and privileges of the rich.
no, I’m not a communist, just a realist.
The words “Tampa real estate investor” and “scumbag” sound awfully similar. I wonder why?
‘Together with the rebates offered by Vintage Grand, Chadwick was able to walk away from the closing table with about $360,000 — money Chadwick said he used to make interest payments on his loans. ‘I could not have carried the properties otherwise,’ he said. When the money was gone, Chadwick filed for bankruptcy protection.’
I’d like to know why this guy isn’t in prison, instead of giving whiny interviews.
Ben,
I guess I failed to understand how getting cash back at the close or rebates or whatever they were calling them was going to work? I followed up with a few calls to promoters in Vegas on C/L just to see what they’d say? I always started by asking them if it’s legal and the response was, “as long as it’s handled in a particular way” ( without describing of course what that particular ‘way’ was? )
It seems to me these were tactics employed as markets were past peak, but hadn’t seen much if any of a correction yet to draw out the last of the GF’s. I couldn’t see any way getting cash back to help the buyer make the int. payments was going to work, especially with such grossly inflated asking prices? This tactic forestalled and discouraged low-ball offers as the buyer had to make a full price offer to get “the deal”.
He assumed that he uses the extra money to make payments for a year or two, and then by that time the house would have of course appreciated 8-10% a year, and he sells, making the difference in the cost of the home versus the amount he owes. Essentially, he assumed that he could just sign his name and make free money.
Ed,
I agree, and that’s certainly how these fraudsters portray it to their potential victims but the property would have to appreciate more than that just to break even. I can’t see how this scam passed even the slightest scrutiny.
Just leaving the numbers aside I would’ve thought more “investors” would have to question the obvious? If they are actually paying ME to buy the investment ( they must really be hurting! ) Or was it so seductive that only Ben’s regulars are immune to it’s steamy allure?
I’d like to know why he didn’t take the money and run instead of giving it all back . . . what a loser. If you’re gonna rob a bank, get enough to get lost and live on for the rest of your life.
Agreed. These big players should have all assets taken and be trown in jail.
Again, I have no way to quantify it. I mean just how incredibly indifferent everyday people were about committing fraud during the boom? I guess it’s because most times when greedy acts are being done it’s typically the same bad actors again and again? A criminal defense atty, an oil company exec., a politician. Yawn. This go round it was people that wouldn’t normally even THINK about stealing from their employer, neighbor etc. but suddenly had no compunction whatsoever about fleecing a bank.
This has to be a direct reflection on the realtors and MB’s that sculpted this type of behavior. Don’t get me wrong, Mr. Consumer has plenty of explaining to do but I refuse to believe that most of them would have gravitated toward this brand of fraud of their own accord? And virtually all of them committing it an a nearly identical fashion!?
It’s just more proof that most people are lowlife greedy ba$tards at heart who, once it is socially acceptable, will quickly show their true colors by lying, committing mortgage fraud, stealing…
After all, ‘Everyone is doing it’ and they have appearances to keep up.
Wonder why the average 1930’s German did what they did - look around you…
cris,
I think you’re right on a lot of accounts and the addition of “having appearances to keep up” explains a lot of it! But I don’t think that just signing an I/O loan so you can enjoy that ‘move up’ home years sooner necessarily means you’re greedy at heart? Or that you initially intended to commit fraud, although it often wound up that way. Maybe it was when your shady MB who’d done countless re-fi’s for you in the past couldn’t get you another I/O the owner turned and became rotten pr!cks? I’m sure in a lot of cases moving up or owning multiple properties looked like a no-brainer.
And how is it that not greed. Multiple properties? Move up home years sooner? you’ve got to be kidding.
I think this says it all…based on Hayeks “Road to Serfdom” published by GM of all people….Me thinks this is where we are headed..http://www.mises.org/books/TRTS/
‘All in all, it was just a bad real estate decision,’ Chadwick said. ‘I didn’t know how bad the market was going to get.’”
It’s amazing how non-chalant one can be when its other peoples money that is going down the drain.
This guy gets everything and loses nothing, all with the help of lending gone mad.
‘All in all, it was just a bad real estate decision,’ Chadwick said. ‘I didn’t know how bad the market was going to get.’”
Should Have read…..
“All in all , my perfect Scam went bad. I didn’t know I was being scammed while I was trying to scam the banks and some more suckers so I could make 3 Million before they all figured out it was a scam……… It was such a good Plan. “
How many people, in the business, got away with it before he crashed and burned? Maybe this was his second or third scam.
You forgot “…and I would have gotten away with it if it weren’t for those darn kids!”
I’d like to know why this guy isn’t in prison, instead of giving whiny interviews.
Interesting, I’ll pass this along to the mortgage fraud task force and let them look into it.
I’d like to know why this guy isn’t in prison, instead of giving whiny interviews.
I agree, completely. This was CLEARLY a “Scheme to Defraud”. That is ILLEGAL. He has not taken a mortgage that he planned to pay back. He knew he couldn’t pay it back….or wouldn’t pay it back.
He, like so many others, wanted the “appreciation” he would gain, using other peoples money, at NO RISK, whatsoever. Another Liar Loan?? Must be.
Chadwick then got two loans from SunTrust and seven loans from Fifth Third Bank,
I wonder how much of this stuff is vetted ?
i wouldn’t be suprised if the answer is all of it.. lenders were no less basking in the warm glow of forever rising prices as was anyone else.
“Ed Bonkowski, a Fort Myers-based real estate broker, did a lot of business in foreclosed properties in the early ’90s in the last major downturn but said he hasn’t lately because good deals are ‘few and far between.’”
“He expects that will change eventually, as foreclosure sales accelerate and bank-owned homes pile up. ‘Our decision to buy’s going to be when the banks are ready to bulk sale a bunch of them, then it’d make some sense,’ Bonkowski said.”
“But prices will have to drop steeply for that to happen, he said. ‘At 15 cents on the dollar, all those properties will be gobbled up, investors will come out of the woodwork and buy them and everybody will go back to work,’ Bonkowski said.”
What this genius doesn’t get is that even if the houses sell at reduced prices, we still need warm bodies to actually occupy them (whether they be owners or renters), or the severe imbalance will continue.
“What this genius doesn’t get is that even if the houses sell at reduced prices, we still need warm bodies to actually occupy them (whether they be owners or renters…”
That is exactly why I don’t put much stock in claims that foreign investors will snap up a lot of these properties because of the weak dollar. Only the stupid ones will and at that, many of them have their own property-price crashes to worry about.
I don’t put much stock in claims that foreign investors will snap up a lot of these properties because of the weak dollar. Neither do I. So far what the foreign investors have been putting their money into is commodities. They would also like to buy every decent American corporation they can, but will probably be blocked by the gov’t.
I think at 15cents on the dollar + rehab cost, using the said property as a cash flow positive rental may be feasible.
Again, can’t really use a blanket term as 15% being the lowest price, since thats property and locality dependent.
got cash?
“Chadwick then got two loans from SunTrust and seven loans from Fifth Third Bank, totalling just under $2 million, or nearly $90,000 more than Brester originally paid for the properties.”
Local banks (including yours) are on the hook for many a bad real loan, and FDIC insurance holdings equal 1/80th of all deposits.
Don’t be one of the unlucky 79 caught holding the bag…
I’d love to hear someone read Ben Bernanke this article, and then ask him to describe exactly how the government could prevent these nine foreclosures, how much it would cost, and for how long. Same question for Barney Frank.
Got a link to the 1/80 stat?
I’ve always been curious about that. In particular - what pool of $$ does the FDIC have to use - e.g. could it dip in the general U.S. fund? (or perhaps more appropriately - if it currently can’t legally - then when the SHTF what steps would have to be taken to make it so it could)
How Safe is My FDIC-Insured Bank Account?
http://www.financialsense.com/fsu/editorials/martenson/2008/0414.html
FDIC’s reserves may be irrelevant to insured depositors. The FDIC has statutory authority to issue bonds that are full faith and credit obligations of the US. 12 USC 1825(d). Currently, the FDIC can borrow up to $30 billion plus 90% of the value of assets held. If that isn’t enough it only needs Treasury Department approval to borrow more. 12 USC 1824, 1825. The government won’t let insured depositors take a loss; the bankers would not put up with it.
There is a Congressional resolution affirming that deposits up to insured limits are backed by full faith & credit of the U.S., the same wording as Treasury bonds.
Notice it says “deposits” and not FDIC. Meaning that even if FDIC goes under, there will have to be some structure to compensate depositors. Up to the limits.
“…the bankers would not put up with it.”
There’s a lot to that phrase. Sickening to think - the rescue would be of the banks, not the depositors even though the latter are helped. Sorta’ like quickly raising a sunken boat from the river because the boat is worth something and oh, the guy who happened to be in the cabin and found an air pocket - he got out OK too - whatever.
this guy may be even too bearish for this bb = 15 cents !!!
At 15 cents on the dollar, all those properties will be gobbled up, investors will come out of the woodwork and buy them and everybody will go back to work,’ Bonkowski said.”
Not at all. This is what people have to consider; a lot of these houses were put up in places that didn’t have real demand. The actual value may be zero, especially if it’s surrounded by more vacant houses. Who wants to live on a street of squatters?
So prices have to come down to where the buyers are rewarded for the risk. And some of it will just get bulldozed. Notice he said bulk. That gives an investor a chance to rehab. Bulk deals are the bottom of the barrel, and rightfully so. Typically deep pockets, like who bought from the RTC.
Coming soon: Subdivision Rentals!
In the future some of the bulk investors will buy up entire subdivisions and form ‘housing rental communities’ much like apartments today. The remaining owners will be forced to sell out being surrounded by renters, much like the lone condo holdouts always give up sooner or later in the reversions to apartments.
Actually I kind of had thoughts along those lines as well. It ‘would’ make it easier to manage for larger players ( Walmart? I mean, why not, you can get everything ELSE there!? ) Then set these people up with “Lease2Own” programs to keep them from becoming complete and total hell holes. Maybe former FB’s can get back into the American Dream through a Home Depot/Walmart “Path to home ownership” program? Desperate times…?
This is what people have to consider; a lot of these houses were put up in places that didn’t have real demand. This bears repeating and much more emphasis than it usually gets.
SOH or save our homes - article 1 was just passed in january 2008 extending homestead exemptions and allowing them to port their low taxed homestead exemption if they move. They just offloaded 8 or 9 billion of property taxes to new buyers or snowbirds. This allows property to be reassessed at a so called market value. This could be as much as 3 or 4 times your neighbors across the street or next to you. I am looking to move back to Florida knowing they are going to gouge me. The only hope for people is to buy in 2 or 4 years when the bottom is in and all sales reflect drastic reductions and are reflected on the taxrolls. If anyone has any info on Gainesvile or if you have any ideas on how best to attack this tax beast in Fl., it would be appreciated. I believe Canada made an announcement telling snowbirds not to go to Fl. because it is now hostile to them and first time buyers. Who is going to buy those houses?
Jeff - I think you have the right strategy - wait until Florida prices have bottomed or preferably, IMO, are finally on the way back up. At that point, I think the values will be not more than they were pre-bubble, where there was no issue with the tax assessments.
There is a potentially large issue that has not to my knowledge been addressed: the movement of these exemptions between counties. If a podunk county were to experience a spurt of growth, as happened to Marion County during the past 10 years, and if a large number of SOH sellers were to try to move their tax “basis” there, I think there could be major funding problems for the recipient counties. As that unintended consequence becomes more likely or apparent, I think it will become a hot topic in Tallahassee.
Personally, I think that SOH portability will do more to screw things up in Florida than the high insurance rates and manipulation of who has to use Citizens.
I’m sure that this isn’t going to bring any tears, but it has even affected the idle rich. My folks live in a sub in Jupiter where the average home price is (was?) between $1M and $2M (they got in early). My folks are homesteaded and have been for a long time and pay about $17,000 a year in property taxes. They have a friend in basically the same house who bought later that was paying $74,000 a year in property taxes. He’s trying to sell even though he can afford it because he says that there isn’t any place that is worth that kind of property taxes.
Thanks for the heads-up, Chip. I sincerely appreciate it. You have given me the answer I have been looking for. Waiting and buying when the market turns up is THE ONLY WAY to buy since the previous year will lock in the declines and will be reflected in my tax rate. Thank you again. Thank you Ben Jones for making it all possible and of course-LOVE THE BLOG and all you sincere and smart people for making it as good as it is. KUDOS TO YOU ALL!
Yes, Ben, and as know know from your time in Texas, if they aren’t bulldozed, the subs are never the same.
Pasco is a hillybilly county overrun with fat Yankee retirees (mostly from Ohio) addicted to yard sales. It could have ranked first in job growth in 2005 by the hiring of two people (a hundred percent increase).
Developers went crazy there. I don’t doubt there are a lot of people looking for work, what ever their economic status.
It’s a darn shame too because it’s pretty country, especially between NPR and Dade City.
NPR (New Port Richey) is a poor excuse for a metropolis, with derelict shops and strip clubs surrounding a main road. Dade City has a nice downtown area harking back to old Florida. In short, the area between them should have never been developed.
Many of these areas will fall to deriliction as gas prices climb and the residents cannot afford to commute to the jobs.
They are just getting ready to re-do downtown Dade City, so it will be even nicer.
Tarpon Springs could be beautiful downtown, if someone with massive bucks bought the whole thing and did it over. Oh well, one can always get a cheap thrill by vising the periodically-weeping (translation: periodically over-humidified) Madonna picture at the Greek Orthodox Church.
I was wondering why Ohio keeps gentifying.
Without any reference to CincyDad, who I am sure is genteel, it doesn’t.
At least Ohio’s not Michigan.
Broward County Florida posted it Property Tax Deliquency Owners..and WOW..the list is huge and in lots of high end communities as well..such as Heron Bay, Parkland Isles, The Isles and so on..(pg 18,17)…many mortage companies as well..the amount has to be into the hundreds of millions..here is the link…
http://www.dailybusinessreview.com/calendar/BRWD_TAX.html
Just goes to show you how many people purchased without including taxes and insurance…ARM county..
“Just goes to show you how many people purchased without including taxes and insurance…ARM county..”
After the bank missed my property tax payment in 2001, I decided I would never ever escrow taxes and insurance again. I ended up paying a $475 penalty because they missed it. It’s apparently my responsibility to make sure it gets paid…even when the escrow statement said payment was made.
This happened to me when I lived in Texas. I paid it rather than wait on them. Pissed me off so bad I drove 150 miles and sat in their office until they gave me the escrow balance and released me from the obligation to escrow anything. Haven’t done one since.
“Haven’t done one since.”
Luckily I sold shortly after and didn’t have to deal with that insitution any more. I have the worst luck with bank. Now I’ve got a division of Credit Suisse servicing my mortage and they want to charge you to breathe. I don’t know if the fees that were initially in my loan package are required to transfer to a new servicing company. Does anyone else know?
“Just goes to show you how many people purchased without including taxes and insurance…ARM county.. ”
Get a clue.
They are well aware that they owe the taxes, insurance, and HOA / Condo fees. They also owe the mortgage. They were hoping for FREE MONEY.
They won’t be getting any if the price goes down.
So why pay?
They didn’t want the damn thing, anyway! They just wanted the Free Money!
Taxes and Insurance are an expense. No return unless you can sell at a higher price. Not gonna happen, so ……..their not gonna pay. It’s just that simple.
Mabe you don’t understand what I am talking about by saying “get a clue, ” diogenes..
You need to get a clue that many ARM(Adjustable Rate Mortgages) do NOT include the payment of taxes and insurance..that is the responsibility of the borrower OUTSIDE of the note..
The point I was making is how many of these borrowers USED the ARM mortgages..hence ARM County…
And what do you mean by Free Money?
I think what he meant by free money is using the house/condo as an ATM as prices rise — for example
buy at $200K
end of year 1, property now “worth” $275K — refinance for $275 K and get $75K cash. Subtract expenses (say $35K for mortgage, HOA, taxes, etc.), there is $40K “left over” to play with.
end of year 2, property “worth” $350K — refinance for $350K, subtract expenses (say $50K), and walk away with $25K of “free money”, rinse and repeat.
What really happened — the rinse and repeat didn’t work. So, continuing my example, end of year 3, property is now “worth” $175K. No Refinance, so the FB is on the hook for $50K (per year) in expenses (assuming no ARM reset or increase in taxes or insurance), so instead of money to play with, the FB is looking at money coming out of his pocket. If the FB doesn’t have $50K to spend on expenses, hello foreclosure. Even if the FB didn’st spend any of the “free money,” that $65K would last less than 2 years.
You understand the concept, but that is not the main reason properties, particularly CONDOS were bought, sight unseen, for the highest amount possible. Buy “pre-construction”. Put $5000 down on a $500,000 condo. Prices increase 30% or more before closing (typical at boom). Your net “free money” is $150,000. You finance 100%, or better yet, 125%. Your cost is zero. What a great “business model”. You are getting lots of free money. This is such a great deal, you go out and buy 5 more.
One problem. You don’t have enough income, if any, to actually pay $35,000 per month in mortgage bills. No problem. You will sell your “investments” for the profit you figured you could get. UH-OH. NO takers. Prices falling.
Time to bail. Taxes, insurance, HOA’s due.
Screw it! I’m not paying them, I’m gonna strip this sucka!!!
That’s what I meant.
Actually most I found of the FB didn’t always refi…most just used the good ole reliable..yeah..Home Equity Loan…use a check against that..
diogenes,
Good point, and one I hadn’t considered. Now I DO recall hearing a lot of people raving on and on about how much other homes in that area had gone up a LOT more than they talked about the house itself. Perhaps it was as much keeping up appearances of being shrewd and successful in making a profit on the bubble and showing everyone you were nobody’s fool and got left behind? Now that I can buy entirely.
“I wouldn’t say Rome burned while they fiddled, I’d say Rome burned and all they managed to do was evacuate the barn.’”
S.P.Q.A.
Stored in the barn were ‘their’ H2’s, Jags, Harley’s, Boats, etc.
It had to be saved!
“Obviously, the state can’t turn the economy around, they don’t have the power to reduce interest rates or lower the cost of a barrel of oil,” said Orlando economist Hank Fishkind. “But they can do little things. The Senate had a plan to speed up construction projects, but unfortunately, the House did not agree. I wouldn’t say Rome burned while they fiddled, I’d say Rome burned and all they managed to do was evacuate the barn.”
______________________________
The legislature fiddled? Florida is burning in part because of the sonata performed by captive economists like Fishkind, who subjugated his independent intellectual judgment to accompany the playing of the masses for fools.
Cue the seal.
“The legislature fiddled? Florida is burning in part because of the sonata performed by captive economists like Fishkind…”
Don’t blame Fishstick or any of his counterparts for this one. While the guy is not grounded in his thoughts, it was mostly the NY, NJ, PA, and MA residents buying on speculation as well as the guys at the golden arches getting loans to buy $500K homes. Fishstick and company only fueled the impression that it could continue and now that it will improve in a timely manner.
Exactly, I made this point many times. Everyone was jumping on the RE spec bandwagon. Also , northern retirees selling for big bucks up north and feeling the need to spend much too much for FL homes.
“‘It’s never been this bad,’ said Florida Education Association Attorney Ron Meyer, who has been lobbying in Tallahassee since the early 1970s. ‘Money is the root of all evil, but even when there’s no money, there’s still evil.’”
Tu ne cede malis, sed contra audentior ito
“It’s never been this bad”
Really??
http://www.stock-market-crash.net/florida.htm
Isn’t the LOVE of money the root of all evil?
“There are a thousand hacking at the branches of evil to one who is striking at the root.”
Henry David Thoreau
yeah.. Timothy 6:10.. or is it 10:6..
.. but the guy was trying to sound clever, and had to misquote or his statement wouldn’t make any sense.
Oh yeah … get back to me when it’s 98 degress come August and you can wrench an 8 ounce glass of water from thin air. Things oughta be really bustling.
And here I’d always thought lawyers were the root of all evil.
No, it’s the LOVE of lawyers…
……….not true.
Lawyers are NOT the root of all evil, they are the conjurers of all evil. Have you had your Tort today?
Tort-sure lawyers put the thumbscrews to our legal system…
Watch it.
This set of articles touches again upon one of the more troubling aspects of the bubble: the extent to which people were talked into participating by friends and relatives, many of whom were in the real estate industry and who stood to directly or indirectly benefit. Just in general, a social shift seems to have occurred in this country. Personal relationships, rather than being a source of emotional fulfillment, simply are treated as a ready-made market. I have been called twice this year by friends who have found jobs in the “personal wealth management” business, and it’s sad, because I can sense that they are calling for purposes of business development rather than because I am their friend.
Personal wealth management. What a scam that is. I’ve had people ask me to “manage their wealth.” No thanks.
“a social shift seems to have occurred”
I was flirting with that in a post just above and it really has me wondering? How did it come to pass that people who wouldn’t consider taking a can of coke that’s been in the back of the fridge at work for the last 6 months not bat an eyelash when being shown fluffed appraisals and bloated income? Income they knew they didn’t have and an appraisal that’s lofty if not outright fraudulent! We all know there’s safety in numbers but when you sign doc’s at a closing it’s kind of a solitary environment. Is this the same incremental effect that leads otherwise decent people into drugs, prostitution etc? I don’t get it.
Sure, why not? Become a life coach too and you’ve got their entire existence covered. Nobody likes to think for themselves, that way they can blame someone else if things don’t work out.
i don’t consider it a shift.. The first thing any new salesman does is try to sell to friends and family… neighbors.. workmates.., etc. Hopefully, by the time that easy money dries up they’ve developed one or two actual sales skills.
“Just in general, a social shift seems to have occurred in this country. Personal relationships, rather than being a source of emotional fulfillment, simply are treated as a ready-made market.”
I don’t think this is a new phenomenon. In the Eighties, my first husband (the stockbroker) turned all my friends into his clients. Unfortunately, he was the World’s Worst Stockbroker. I am still apologizing.
“I don’t think this is a new phenomenon.”
It’s certainly not. Look at just about any business. The first place you go is family and friends. It’s branching out that is required to be successful. Unfortunately things like real estate shouldn’t be left to family and friends. A disinterested 3rd party is almost certainly better to deal with it. You don’t want to lose a friendship or a relationship with family because the house you just talked them into buying is worth 40% less just 6 months later.
My niece called me one day and wanted to come visit with her husband. I really admire my niece, but she’d never expressed this urge before (I lived 80 miles away).
Before the evening was over, I was sitting at the kitchen table with them. The conversation went kind of like this:
Them: How would you like to be able to go on a cruise anytime you want?
Me: I can’t swim, scared of water, claustrophobic, hate close quarters with people I don’t know. I’d hate it.
Them: Well, hows about if you could buy any house you wanted?
Me: I love my house here, it’s exactly what I want.
Them: What if you could buy any vehicle you wanted?
Me: I’m fine with my pickup, love it.
Them: Well, what about shopping, what if you could go shopping anytime you wanted, buy exactly what you want.
Me: I hate shopping, but I can do that now if I want.
Them: Pausing to think - Well, isn’t there ANYTHING you want?
Me: Hmmm, hows about a little more free time to go rock hounding…
They left. They’d driven all that way to sell me on some whacky MLM scheme. I never trusted them again.
Last month I stopped in Panera bread to finish a little work. I was approached by a guy who ‘recognized’ me (I do a lot of speaking engagements in the area), but in the course of our conversation he didn’t ever attend any of the events he could have met me through. He asked for my card and said he wanted to talk about a great opportunity.
Fast forward a couple weeks the guy has called twice with a great opportunity he wants to discuss with me. I bet it’s some kind of MLM scheme and I don’t have time to waste of that. The best indication was his second message about how this ‘opportunity is going away and he won’t be calling again’.
I have a friend that does about the same thing every couple of years or so. At this point, he knows how I feel about MLM stuff, but he tries anyway.
He’ll start out with the speech they taught him, I’ll start to smile, and he’ll stop. Then he’ll just go into a normal conversational tone (drop the marketing stuff) and tell me how it’s different this time. I usually laugh and make fun of him a bit and ask about the last one.
We aren’t great friends or anything, but he’s an ok guy for the most part and I don’t mind catching lunch together from time to time or having a few beers after work. Usually we end up drinking a beer and shooting some pool. But it never fails to amaze me with this guy. He’s a reasonably intelligent person, he’s just so into the idea that somehow some way he can make a ton of money and retire. I keep telling him that outside the lottery, if he wants to “work for himself” it requries hard and LOTS of work. That’s why I don’t do it…
I got caught up with a MLM scheme about 10 years ago (Primerica Financial Services). I ‘abused’ my trust with a neighbor and went there to sell them an insurance policy with my trainer. He went on and on even when it became apparent they weren’t interested and I left feeling like a dope because it was clear they weren’t impressed with his sales pitch. That was the end of that educational occurence.
A transitory error in judgment, apparently corrected, is not cause for guilt (unless you got all the assets in the divorce).
Snake Charmer, you’re on to something. I’m 28 and bought a condo in Mass. two years ago. I had wanted to live on my own but renting seemed shaky at the time. I waited until the market started moving down, but I didn’t wait long enough. I talked a lot about the desire to own w/ my mom. My mom actually told me , ‘Get your foot in the door now, because prices will go up’.
Thinking back, at the time I failed to think of all the bad investments my parents made. They bought a parcel of land in Englewood, Fl. Sat barren for years until they sold it to someone else for a loss. They also were involved in at least two multi-level marketing companies. They refinanced several times and took out loans against their retirement funds.
I should have waited and rented. Things turned out fine for me, I got a new job with a great income. But it was real easy to get swept up in the emotion of home ownership when someone you trust is telling you all about it (My parents were divored in 2003 and sold the house in 2004, so they did end up selling for 200K more than they purchased the house for, but after all the refinancing who knows what they actually owed).
I’m glad I found this blog. Its caused me to change my philosophy to be fiscically conservative. Its a great lesson to learn.
Unless the family member was a realtor or MB trying to work you for a commission I have to believe they really truly believed in the message they were trying to share. I’ve never seen such a high degree of confidence and conviction like I saw from RE investors during the boom. Perhaps it was because the profits seemed guaranteed that every infraction in the qualifying and closing process was simply looked upon as a “white lie”. Does anyone here recall a friend that got a stuntman loan on a fluffed up property being worried they’d be “found out”? Boy I sure don’t. I also can’t think of a single person that said “I’m crossing my fingers hoping this all somehow works out” either.
Ed, I too didn’t wait long enough. Even the folks on this board didn’t know exactly how far it would go. I bought at 2001/2002 prices in 2006 before the credit crunch. I firmly believe that had the credit market not imploded so badly that places like Palm Beach County would have stuck with the 2001/2002 prices. Now with the banks selling foreclosures at $0.33 on the $1.00 you’re really watching value deflate. Homes that actually sell are now firmly in the late 1990’s prices. Others just sit on the market and wait.
“…because I can sense that they are calling for purposes of business development rather than because I am their friend.”
Uh - you aren’t their ‘friend’ - you’re a mark, a pigeon, a dupe to sell their latest scam to.
It seems that personal wealth managers, including bank trust departments, have the goal of grabbing half of the client’s income for themselves. They do that by putting the assets into affiliated mutual funds with high fees, high expenses, and excessive trading (using an affiliated broker-dealer), or high load funds where the commission goes to the wealth manager. Then on top of that they take a 1% management fee and charge the client for all of the administrative expenses. In the end a professionally managed trust or account earns 8% gross and 4% net, before taxes.
In spite of misconceptions an account is either transaction based or it’s fee-based. There was a time when brokers had their cake and ate it too but this loophole was caught and promptly filled. In some cases firms were required to reimburse clients that paid a commission in ADDITION to an on-going fee.
If the mutual funds have high mgmt. fees they go to the fund company *not the firm or ind. broker. Besides all of this is very closely monitored by their own internal compliance dept. so putting a loaded-fund into a managed account is a major no-no. The only place I see where there are still rampant problems is in the unaudited HF’s. I think we would all love to see that just go away. Typically today managed money has an R.O.A of about 1 to 1.5%. The bigger the account, the larger the discount.
” Personal relationships, rather than being a source of emotional fulfillment, simply are treated as a ready-made market . . ”
good comment, snake charmer. damn true. just like the endless support yer co-workers kids fundraising events at the office. seen so many azz-kissers buy junk from supervisors to earn brownie points. hilarious!
women seem especially prone to this pass the hat syndrome, with the Avon catalogues, school fundraisers, “special” pleas (sickness, pregnancy, death, etc) cards asking for money, and on and on. a few companies I worked for seem to have daily, DAILY, appeals for money. but what really took the cake were the internal E-Mails (HealthNet) piling up by the hour w/pleas for financial help. it seemed the same people always took it upon themselves to launch rescue missions, crusading for some cause or another. you had to wonder how the bloody hell these people ever got any real work done?!
been my experience that any company with more than 100 employees has at least 10% useless deadwood.
ok I’m done. for now
There is no doubt that Florida is in serious trouble along with most of the high flying RE cesspools in other states. The US gov’t, the REIC gang and the states all contributed to the creation of this housing Frankenstein.
This Grand Monument to sheer Financial Stupidity was created by Crimes of Commission along with the Crimes of Omission from the main street to Wall street for sheer GREED.
The msm is real busy running all these stories about poor used and abused Fbs when it should be running MORE stories on WHO IS GETTING RICH from all these RE Shenanigans from Wall street to the local banks and RE brokers. If the FBI can’t handle it, local and state DA’s should.
The MSM should help identify these RE crooks, hoodlums and criminals and DEMAND that someone prosecute the living HELL out of them with every law and statute on the books instead of allowing Washington to through billions into this slimy sinkhole to COVER UP their crimes .
The REIC looks to be around the same place the Reich was on this day, 63 years ago…
Wrecked
Yup, the Reich was looking pretty bad 63 years ago. But the Germans did rebuild, and, yes, Uncle Sam did help.
To this day, Germans of a certain age look back on the postwar rebuilding era with pride. I’m well acquainted with a German-American who came of age during that time. And trust me, you don’t want to get her started on the lack of get-up-and-go in present-day America.
“The REIC looks to be around the same place the Reich was on this day, 63 years ago…”
the “Third REIC” !?
I think that’s a bit naive. The REIC crowd controls both the state government of florida and, through advertising, the local newspapers. The Republican Party of Florida is a wholly owned subsidiary of the Florida Association of Home Builders.
News organizations exist to sell advertisements, not to inform the public. Representatives and Senators exist to collect campaign contributions, not to serve the public. The public, through its voting history, deserves what it gets.
Off-(this post’s)-topic, but has anyone seen this Newsweek article talking to David Lereah, late of the NA(UHS)? Curious as to your thoughts…
http://www.newsweek.com/id/135724
Looks like Lereah is still too optimistic, but at least he now recognizes that his error will be in the right direction (even lower prices).
I’m surprised he is employable. Perhaps there is hope for all those unemployed morgtage brokers.
“Together with the rebates offered by Vintage Grand, Chadwick was able to walk away from the closing table with about $360,000 — money Chadwick said he used to make interest payments on his loans.”
That Chadwick fellow had a pretty clever play going walking away with $360K from closing. He should have relocated to Grand Cayman or some other exotic location instead of making one penny in payments. That’s where he screwed up. Who where the asshats giving this guy money anyway?
This is the best title yet.
There’s “bad” news out the wazoo in the online Orlando Sentinel today:
http://www.orlandosentinel.com
“Home values keep sinking” - an example: in Celebration, the supposed utopia, they’re down 26.4% in one year, according to the story.
“Weak economy, high food prices take the sizzle out of high-end steak houses”
and
“Book’s Critique of The Villages lifestyle fires up debate” - this place is a huge, dense retirement community closer to Ocala than Orlando.
“That the company has tried to be sensitive to its customers’ plight is a statement Levitt homeowner Dan Wenk strongly disagrees. Toxic mold and water damage in his Clermont home near Groveland…he claims made his home unlivable and that Levitt has refused to address. Wenk says his battle took on new urgency in August 2006 when he was diagnosed with leukemia.”
“‘I’m not blaming Levitt for my illness, but I’m saying, ‘Hey, I can’t live in the home you sold me, and you haven’t done anything to fix the situation,’ says Wenk, adding that he and his family had to rent another home in which to live.”
“‘I hired an attorney, and when we finally sued Levitt, it was about the same time that I noticed…they were reorganizing their stock. Levitt requested an extension for responding to the points we raised in the suit, then they asked for more time. Then, I found out they had filed bankruptcy,’ he said.”
“Wenk says that the cost of his now-stalled lawsuit, medical expenses and the burden of maintaining a second home pushed him over the financial edge. ‘Because of this, I’m having file for bankruptcy now, and my mortgage company had to foreclose on the Levitt house.’”
Wenk appears to have been screwed by Levitt. I’d like to see a judge sentence the head of Levitt to live in Wenk’s house. It’d be sort of like those cases of slumlords being sentenced to live in their rental properties.
The faster some of these builders go out of business, the better. Perhaps the next generation of builders will value quality and energy efficiency more.
The builders didn’t worry because the buyers didn’t worry. If they did, there would be very few of the homes here that are here, because not only do they not fit in with the architecture, they also don’t fit with the climate. I’m not going to pay $300 a month for electricity because there is no insulation in the walls.
“City Commission wants Florida divided into two states”
“Furious at what they call no respect from state leaders when it comes to collecting and spending their own money, the North Lauderdale City Commission passed a resolution requesting that Florida be divided into two states: North Florida and South Florida with the boundary line from Palm Beach County down through Monroe County.
“The North Lauderdale Commission has sent out 306 resolutions asking other municipalities and counties to join in the effort.”
http://www.orlandosentinel.com/news/local/state/sfl-0506floridadivided,0,3473771.story
You can’t make this stuff up.
There really is only one state in Florida. A state of denial.
Monroe County would never go for that.
Historical trivia: In the pre-statehood days it was East Florida (east of the Suwanee River) and West Florida (west to New Orleans). Mississippi and Alabama didn’t have those little tag ends to the Gulf until Florida got statehood. Tallahassee, the capital, which today is a long way from the population centers, was chosen for its central location. The only big city in the “south” was Key West. Miami grew up after the turn of the century as a winter haven for wealthy northerners. Dade, Broward, and Palm Beach Counties were swamp and wilderness until Flagler built his railroad and hotels.