House Prices Are Really The Culprit
The Lockport Journal reports from New York. “Lockport City Court is laying down the law on responsible home ownership. Judge Thomas M. DiMillo sentenced a former homeowner to fines and community service Tuesday for his part in the deterioration of a property that he lost to foreclosure. DiMillo also warned the former occupant of another vacated home that she, too, faces consequences for walking away from title-holder’s responsibility.”
“‘At some point three years ago you had an obligation … that you couldn’t afford to do anything about, so you abandoned it,’ said DiMillo. ‘(That’s) a crime in itself.’”
“‘Word has to get out that you can’t just abandon property,’ said Prosecutor Matthew Brooks. ‘You have to do something to get out from under it, not just stick your head in the sand.’”
“Judith Northcliffe, owner of 162 Monroe St., asked the court’s help to get out from beneath the burden of owning a house she bought sight unseen 14 years ago and has regretted ever since. She told the court that her only income is $856 a month from Social Security — and she’s just taken a job, ironically at a collection agency, because she needs the money so badly.”
“While Northcliffe has offered to simply turn over the property to the city, Brooks said that’s not permissible. In formal seizure process, any party with a claim to the title, like the bank, has to relinquish the claim in court first, so that it isn’t transferred to the city.”
The Telegraph from New Hampshire. “The latest data from the New Hampshire Association of Realtors indicates that Hillsborough County homes and condos that were sold in the first quarter of this year had been on the market an average of four months – the longest period since the group started keeping track a decade ago.”
“Sales and prices were dismal, too. A total of 452 properties sold in January, February and March, by far the smallest first-quarter figure in the last decade. The median sale price, measuring the point at which half of sales cost less and half of sales cost more, fell to 2004 levels.”
“This means that anybody who bought a house in southern New Hampshire during the last three years has probably seen its value go down, a fact reflected in rising foreclosure rates, which doubled in Hillsborough County last year.”
“If there really is a silver lining in every cloud, first-time buyers are playing the only upbeat note in the huge black thunderhead that is New Hampshire’s housing market.”
“‘The best buyers are those who don’t own any real estate, have good credit, have cash for the down payment – they are the ones who can make deals,’ said Yve Hines, a real-estate agent in Nashua.”
“Jim Lyons, president of the New Hampshire Association of Realtors, added that even perennially optimistic real estate agents don’t expect a return to a boom era like the first half of this decade, when median house prices in Hillsborough County increased an average of more than 12 percent every year.”
“‘I don’t believe it will come back wildly,’ Lyons said. ‘Some of what you’re seeing now is reflective of such a fast run-up (in prices). The market is sort of catching up with itself.’”
“The obvious comparison is to the swooning housing market in the early 1990s, when home sales and prices, and particularly condominium prices, were savaged. The big difference today is the greater reliance on debt from new types of mortgages and a greater ease in borrowing against soaring home values.”
“‘One difference between the ’90s and now is that more people have tapped into their equity,’ Lyons said. ‘They were essentially using their home as a credit card.’”
The Daily Democrat from New Hampshire. “Signs of greater housing market strain have begun to bubble up in the Granite State. Percolating just below the subprime crisis is growing concern about prime — or standard — loans, which have often been touted as stable, secure guards against skyrocketing foreclosures.”
“Data released recently shows more than 18,000 New Hampshire mortgages were listed as delinquent as of the end of March, according to the New Hampshire Housing and Finance Authority.”
“That figure — coupled with a doubling of foreclosures during the first quarter of this year over the same time last year — is by itself cause for concern, say experts, but more worrying is that nearly 11,000 of those delinquent mortgages are prime loans.”
“‘It is spreading. It is not just a case of problems in the subprime,’ said Dan Smith, director of housing research for the NHHFA. ‘We’ve seen this increasing since 2007.’”
“The U.S. Mortgage Bankers Association reported 250,340 prime loans across the state, with 10,710 — 4.2 percent — being delinquent and 730 — less than 1 percent statewide — already in foreclosure. Of the 32,650 subprime loans reported statewide, 6,390 — 19.5 percent — were delinquent and 1,150 — roughly 7 percent — were already foreclosed.”
“‘You could make the case that housing is more affordable at this point, but I don’t think that’s particularly germane,’ Smith said. ‘That can only work if incomes go up while housing goes down, and I don’t think we’re there yet. People are extremely uncomfortable with their situations.’”
The Boston Herald from Massachusetts. “The foreclosure crisis in Massachusetts has gone from bad to worse, with the number of homes seized by their lenders soaring in some of the state’s wealthiest towns, a new report finds.”
“Some of the state’s toniest locales, including Nantucket, Edgartown and Weston, have seen their foreclosure rates double over the past year, ForeclosuresMass.com finds.”
“The increases outstrip the average for the state as a whole, with Massachusetts seeing a 37 percent jump in the number of foreclosure notices filed by banks and other lenders in the first quarter compard with the same period in 2007.”
“‘The foreclosure crisis really has no boundaries in Massachusetts,’ said Jeremy Shapiro, president of ForeclosuresMass.com. ‘Communities rich and poor, urban and suburban and rural are all being impacted.’”
“Leading the foreclosure pack, three of the four towns with triple-digit increases are in the top tier of the real estate market. Belmont, Oak Bluffs and Nahant have seen the number of distressed properties increase by 200 percent, 217 percent and 240 percent, respectively.”
“The downturn in the market and falling home prices have made it difficult for people to escape, even in wealthy communities, if there is a job loss or other setback, said Karl Case, a Wellesley College professor and real estate market expert. In a down market, the option of selling the house is no longer there.”
“‘House prices are really the culprit,’ Case said.”
The Providence Journal from Rhode Island. “Rhode Island house prices during January, February and March fell 9.4 percent, the largest first-quarter decline in more than 20 years, according to a report released today by The Warren Group.”
“Meanwhile, sales of single-family houses during January, February and March plunged 20.4 percent from a year earlier — the steepest first-quarter decline since 1998.”
“Rhode Island’s real-estate slump is shaping up to be ‘more dramatic’ than during the early 1990s, when [monthly] ‘double-digit drops in price weren’t the norm,’ The Warren Group’s CEO, Timothy Warren Jr., said in a statement. ‘They are now, and we’re not sure when that will end.’”
“Condo sales in March plunged nearly 51 percent. For January, February and March, condo sales were down 37 percent, compared with 500 a year earlier. Sales of both condos and single-family houses have fallen by double-digits every month since August, the report said.”
The Hartford Courant from Connecticut. “Connecticut’s housing recession deepened in March, as sales plummeted and the median sales price of a single-family house slid for the fourth month in a row and by the most since the mid-1990s.”
“The median sales price fell by 7 percent in March, to $268,250 from $288,500 for the same month a year ago, according to the monthly report from The Warren Group.”
“That’s the biggest monthly price drop since April, 1995 when prices declined by nearly 8 percent. And the decline is starting to look sustained. For the first three months of the year, the median price has fallen 5.8 percent to $266,000 from $282,500 for the same period a year ago.”
“Sales of single-family houses across the state plunged by nearly 30 percent in March, compared with the same month in 2007.”
“Warren said Connecticut appeared last year to avoid the housing slump gripping other states in New England. ‘But this year, it’s a different story,’ Warren said. ‘The state is quickly catching up with the correction affecting Massachusetts and Rhode Island.’”
The Connecticut Post. “‘This is the biggest price drop in Connecticut in 13 years, and Fairfield County is leading the way,’ Warren said of the single-family numbers.”
“In Fairfield County, sales in March 2008 were down 37.33 percent from March 2007, to 413, and median prices fell 10.09 percent to $508,000. The year-to-date figures for both measures were also down, by 31.87 percent for sales and 8.51 percent for prices, to $507,750.”
From The Day in Connecticut. “Local foreclosure filings during this year’s first quarter jumped more than 50 percent, according to statistics released Tuesday, and experts say housing prices will likely drop as a result.”
“Numbers from The Warren Group show that first-stage foreclosure filings in New London County were up 54.2 percent during the January-through-March period compared with the same period in 2007.”
“A total of 407 foreclosure filings were started in the past quarter, compared with 264 last year. That’s nearly double the number of foreclosures in the same period of 2006.”
“‘The victims of foreclosure, for the most part, are not able to re-enter the housing market right away, so there are thousands fewer people in the market for a new home,’ Warren said in a statement.’It will take some time before the number of foreclosures starts to stabilize, and home sales and prices pick up.’”
“Vincent Valvo, group publisher at The Warren Group, said it generally takes anywhere from three to six months for foreclosures to be completed once the initial filing is made. He added that an increase in foreclosures of more than 50 percent would translate into lower prices over the short term.”
“‘It really puts an incredible strain on the market,’ he said.’It cannot bode well for property sellers. It’s likely that the value (of homes) is going to decline (further), and much faster than so far.’”
“Massachusetts prices dropped 10 percent in March compared to a year ago, while Rhode Island’s decline for the month stood at 10.3 percent. Both states are seeing reductions in real-estate prices not experienced since the late 1980s.”
“In fact, Valvo said, the situation is so bad in Massachusetts that for every house sold in the state, another is going into foreclosure.”
“‘It’s an absolutely terrifying real estate situation in Massachusetts; it’s a bad dream in Connecticut,’ he said.”
‘I don’t believe it will come back wildly,’ Lyons said. ‘Some of what you’re seeing now is reflective of such a fast run-up (in prices).’
‘three of the four towns with triple-digit increases are in the top tier of the real estate market. Belmont, Oak Bluffs and Nahant have seen the number of distressed properties increase by 200 percent, 217 percent and 240 percent, respectively.’
‘Valvo said, the situation is so bad in Massachusetts that for every house sold in the state, another is going into foreclosure. ‘It’s an absolutely terrifying real estate situation in Massachusetts; it’s a bad dream in Connecticut.’
So while the MSM and others are focused on meaningless votes in Washington, this blog sticks to the real story. These numbers out of Massachusetts, BTW, are on top of all time record defaults in 2007.
And because of interventionist policies by our Gov., expect that our foreclosures are at least 6 months extra behind. Last year Gov. Patrick signed a law putting a moritorium on foreclosures in Mass. That means an extra wait for banks, and merely a delay in the curve which hopefully in Mass. will continue to go down.
Oh, I don’t know about delaying the curve. I could see this as a reason banks might be more reluctant to lend in Mass. IMHO, there will always be somebody who will sign on the line for an overpriced house. If said people can’t get loans they will not be able to buy….less buyers, lower prices.
he’s out bamma’in hilery
maybe he’ll be obama’s head of HUD
what’s your deal, are you some dittohead?
He’s funnier than that.
There was a brief moratorium a year ago. Obviously lender’s are having no trouble foreclosing since there have been 9000 this year alone. If there were truly a permanent continiuous moratorium there would be no foreclosure and no lending in MA. That is not the case at all.
Actually it was not a law at all. The state would contact lenders and ask for a freeze. Of course the lenders need not compy (and, it appears from the rocketing foreclosure rate that they didn’t)
http://www.thebostonchannel.com/news/13228876/detail.html
Jill,
I only have so much energy for all of these issues. In the full spectrum of bubble-related BS borrowers mooching a little free rent before being shown the street is the least of my worries. I’m not saying it’s a non-issue it’s just that even in the best of times, divorced/laid-off people work the system. It happens. The only reason we’re even bothering is b/c it’s happening on a larger scale than normal. The record for “free rent” as I understand is 4 years and that was the C.O.P’s ‘ex’ in Cleveland? So I guess I can chip my teeth over that?
They have only had houses there for a little under 400 years. This isn’t that much of a record, compared to, err, umm , Pompeii !
wow, a left wing hanging judge
judge Thomas M. DiMillo sentenced a former homeowner to fines and community service
Even in non-recourse states you should be able to come up with a few claims that might stick if the debtor trashes the property on the way out, as there are usually non-recourse carveouts for intentional misconduct. Morally, it’s a good result. Economically, I guess I’m indifferent if such claims prevail, as trashed housing lowers values. Until I buy, its in my best interest that once professed idyllic neighborhoods are imploded.
From the link above:
“”(Northcliffe) On a sparse income, she qualified for federal financial assistance to make some repairs, but the issues continued. She later stopped paying her mortgage and moved out.
Indicating how little it values the property, Brooks said, Northcliffe’s Texas bank turned over her $40,000 debt to a collection agency instead of foreclosing.”"
HUH? Is this a non-recourse state?
I’m all for going after people who deliberately trash a place, but to go after people for “letting it go” because they couldn’t afford it is total stupidity.
Detroit tried crap like this too. The boneheaded city politicians thought that by punishing property owners they’d make property values go up. What happened instead was it further discouraged people from even trying to buy the properties because they knew the city would screw them at every possible juncture. So, in the end, the city still ended up owning so much dozer bait people were asking for them to call in the National Guard to destroy them all.
Heck, When I lived in a small town in Kansas. One guy let his grass grow too high and had a lot of antique cars on his few acres and when he was gone one day they bulldozed his cars and buried them as well as his home.
Dumba$$es didn’t worry that he owned all the land that the county used for years as landfills for free. He told them to go $crew themselves then the had to hire someone to all all the towns garbage to another counties landfill and it cost them Big $$$$$$$$$.
I LMAO!
Where did this happen and when? And who did the bulldozing?
It was the City that bulldozed the property. About 20 years ago. One of the council members was his neighbor and didn’t like the eyesore. Another town did the same thing to a guy I knew about 7 Years ago. He had $350,000 worth of antique cars . All buried while He was out of town. This was Galena , Kansas and Oswego Kansas. Small towns think they can do as they please with Your property with no Consequenses. They condemned my property on Main Street because I had a House that was Grandfathered in and they didn’t want it there anymore. Been there for 40 Years. This was in 2004.
I PROMPTLY MOVED. But it’s as bad or worse in Florida.
“While Northcliffe has offered to simply turn over the property to the city, Brooks said that’s not permissible. In formal seizure process, any party with a claim to the title, like the bank, has to relinquish the claim in court first, so that it isn’t transferred to the city.”
Bet you if that derelict property was some valuable mansion or beachfront parcel, this by-the-book judge would magically find some legal way to approve receivership.
personally been on both sides of the court; they can drag their feet or rush something through . . . interpret the law however it suits ‘em at the time. blind justice? no such thing !!
but for now it’s a game of hot potato with these properties. hilarious.
tax me
there was probably a lot more charges more serious in nature, maybe trumped up, that were dropped in order to have this homeowner plead out. thats what law enforcement does; stack the deck with bogus xtra charges in order to later force a plea deal. the defendent is so relieved to not be facing major prison time that they will accept pretty much any deal, especially one for a misdemeanor w/no jail time. I keep this in mind as I read about legal outcomes.
this is the legal systems dirty open secret. hell, if only 50% of those charged with a crime rejected plea bargaining & demanded a full trial, it would bring the entire justice system to a screeching halt, not to mention bankrupting many counties, over the sheer volume of litigants.
That is exactly is what is so frightening about trying to live peacefully in society today. There are so many laws on the books that at any time “They” can come along and make a criminal out of you in a New York minute.
As the economy (likely) continues to decline and perhaps ultimately implode (enough), it doesn’t take much to think that one of the biggest losses to all is their freedoms.
Being a bit paranoid sometimes is justified.
wow, a left wing hanging judge
How do you figure the judge is a Lefty? Expecting people to honor their personal obligations is not only core Conservatism, it’s also diametrically opposed to the pathological victimization so beloved by the Left.
I was responding to the weak sentence- picking up trash etc……
lol!
Nothing like bias countered by bias.
As for you comments on the left, there is a wide gap between handouts and a desire to help those in need so they dont need additional help in the future. Victimization? Most liberals support affordable housing so welcome the bust. Labels dont work. There are ignorant ppl on both sides.
There is a long standing case in Dallas where a guy rejected a bequest from his father for a rundown eyesore but the city is still chasing him trying to get him to repair it. I wonder what happens if he dies willing it to the mayor.
Didn’t the guy who rejected the bequest used to post here?
So if there is pent-up demand and fence sitters…..what would a dead cat bounce look like??? How long would we expect the bounce to last???
The realtors love to talk about pent-up demand, like there are so many people who could afford an overpriced house but are just scared off by the media temporarily. They don’t yet get that the reason most people don’t buy is not because they are scared to, but because they can’t afford it without creative financing.
But I’ll tell you whats pent-up: Supply. There are so, so many people either trying their luck as landlords or waiting “until the market gets better” to put houses on the market. If we see a dead cat bounce it will be shortlived because these people will try again to cash out and inventories will explode even further.
Rally,
What’s more is that the only thing that was ever needed for the wheels to come off the housing “boom” was simply for prices to stop rising. All the leverage and multiple purchases made sense as long as prices continued to rise. Absent that, the game is over and people are looking at homes as shelter again and determining their choices based on actual “needs” not momentum investing. I agree and until the REIC understands that, there’s no hope they’ll abandon their basic premise of continued appreciation.
A lot of people are not buying because when faced with realistic LTVs on their mortgages, they are only able to afford less desirable homes. They are waiting and hoping the nicer homes will drop into their price range, that exotic loans will return to the market once the
cretincredit crisis resolves, or looking to see what happens to their jobs and the overall economy and considering relocation.Only a small minority of buyers are holding off because of the specific issues we discuss on the HBB on a daily basis. I’m always surprised how good a job the MSM does of keeping people clueless about what they still think is just the “subprime crisis”. Most of the prospective buyers I speak to are still using MSM talking points from last October.
NoSingleOne,
That is correct. When confronted by today’s realities in lending what else can a buyer do? Just twiddle their thumbs until homes on their radar move into a price range they can actually qualify for. Where I will give J6P a little credit is that I don’t believe they are going through this exercise with an eye toward greater/more profits down the road.
We’ll see a lot of people consolidate their move up/dream-home together and compromise. That much less volume for NAR down the road.
Methinks that a lot of the “trying their luck” landlords will be dumping their properties in another year or so. Why? Because landlording’s a lot tougher than “just renting it out.”
‘Because landlording’s a lot tougher than “just renting it out.”’
Too right. I have done it, off and on, for 8 years. Many of the tenants were lovely, but still. I had to replace the ceiling of the neighbor downstairs because somebody let the bathtub overflow. And mediating a childish feud between one the tenants and the ground floor neighbor (”you shut up!” “no you shut up!”) was no picnic either. I’m glad to be back in my house!
What’s really pent up is frustration, especially on the part of the more cautious and prudent segment of the population that refused to overpay for a house or compete with fools playing with someone else’s money. Hence my satisfaction at seeing FBs and speculators getting their just desserts.
I’d expect it to last 3 months starting in the warmer months, but not this year. Many will end up holding on to unrealistic prices again and not be able to sell .
It will be over once the numbers come out at the end of the quarter.
Followed by an even larger pent-up foreclosure.
Crazy couple of guys trash their home in Florida no direct link, scroll down to
WFTV.com Slideshows about half way down.
http://www.wftv.com/index.html
What is with all the “Jesus” signs?
The handwritten “no trespassing” sign in the window was hilarious. Who owned this place, The Little Rascals?
It’s Florida.
Builder held after standoff
The developer who has faced several lawsuits over his failure to complete local construction projects – including two in Litchfield – was the focus of a six-hour police standoff at his Londonderry home on Tuesday. Richard C. Berube, 43, didn’t leave the house even though police deployed four cans of pepper spray, police said. Officers found him hiding in the rafters of the attic donning a mask, police said.
http://www.nashuatelegraph.com/apps/pbcs.dll/article?AID=/20080508/NEWS01/676036834
You should see the picture of his house. Pretty nice. Police went after him for not paying child-support. He has a half-completed 55-plus unit housing development that just went into receivership. He filed for BK last week.
Michael,
I made a promise to myself late last year *not to be as negative in ‘08. Then you read about a guy that seems to embody practically every negative trait we’ve come to expect from builders/developers and you have to fight that negativity all over again! Let’s see, bails out of financial obligations? Check. Substance abuse? Check. Disregard for the law? Check.
Sorry dude but when Johnny Law comes knockin’ on your door it’s over. It’s hard for me to believe that anyone that has a gun drawn on them continues to flee/elude? People that only abuse alcohol ( unless they’re really, really young ) wear out very quickly.
Denver.
Makes me see red.
http://www.usatoday.com/news/graphics/foreclosure_map/foreclose.htm
click on ‘regional map’ on the left to get the big picture.
wow.
The regional map is even crazier. Amazing.
What a nightmare…none of those houses have any yard, seem far removed from any cultural amenities, and they look very cookie cutter.
I bet that 2000’s turn-of-the-millenium architectural planning will be remembered in architectural digests as one of the worst periods in modern history. Doesn’t bode well for long term resale value, does it?
Indeed, and with builders itching to keep building - look for them to start dissin’ the very product they churned out just a few years before. That’ll make houses of the vintage even more undesirable as they roll out new styles and features.
like 6.5 foot ceilings and small windows, small romes
built in wood stoves
WEEeeeeeeeee
I see red people.
It’s all about affordability.
Until house prices drop to affordable levels (rental equiv. & incomes) there is no end in sight.
And affordability hinges on jobs, which everyone is ignoring. Wake up Washington. If you fear an overcorrection in housing prices, then the concern is the economy.
But then again, many jobs during this latest “recovery” were positively correlated with housing prices.
Simultaneous equation models make my head hurt.
Ben, for the last 5-10 years housing was the economy in many parts of the country.
but…..but…but…stop being so negative. the call center jobs/wally marts will be our salvation. in shrub we trust.
I’ve read in several places that during the economic recovery from 2001 on, 40% of all new jobs were housing related, and 40% of all new jobs were in health care & government. Also during that same period, about half of consumer spending increases were funded by increased income while the other half were funded by increased debt. The period of so-called economic growth from 2001 through mid-2007 was actually a period in which capital was simply converted to consumption. That’s the equivalent of a farmer eating his seed.
As for the housing price equation, while the valley in the loan reset charts and low Libor/Treasury rates will help on the supply side in late 2008 and 2009 through reduced foreclosures and distressed sales, our non-productive economy will noticeably affect the demand side. It sure looks like there will be no nationwide bottom in prices and transactions until the end of 2012.
tuxedo_junction,
Well said Sir! I’ve long loathed the “Faux Recovery” and you just had to know there were limits to playing musical houses. I understand fully why the REIC wants to retain the “Consumption thru Housing” model ( I’m just not sure why the consumer does? ) Don’t people realize that if your house NEVER appreciated but your payments were HALF of what they are now you would have plenty of disposable income?
“‘Word has to get out that you can’t just abandon property,’ said Prosecutor Matthew Brooks. ‘You have to do something to get out from under it, not just stick your head in the sand.’”
This is great for those who stop paying the mortgage and continue to live the house. They can cite this case as evidence that they were doing the right thing under the circumstances. Until the lender says leave, stay put rent/mortgage free.
If banks won’t foreclose in these circumstances, then the property should just be seized by the city or state. You can’t get blood out of a stone. Of course you can throw someone in jail which will cost the taxpayers more money to house him.
Seems fair enough. The court is declaring that until the banks foreclose the bond between the ‘homeowner’ and the property still remains. That means it is the ‘homeowner’s’ responsibility to live on the property (rent free) in order to render the maintenance services mandated by law. The bank cannot force the ‘homeowner’ to leave prior to a formal foreclosure, since the ‘homeowner’ could face criminal fines.
Nice little precedent.
Just quit paying the property taxes first, then the city will own the property, and the bank’s lien will still be attached to the deed. Then the bank and city can fight it out.
How about just living there and eventually getting the house in adverse possession? In Utah, you have to live in a property (adversely, i.e. w/o approval and not wanted) for 7 years and pay the taxes on it, then it’s yours. I could see some banks conveniently forgetting they own certain properties…
will a generator last that long ?
Well geezlouise, I’d assume you’d pay the electric bill, too, it’s easy to put in your name. In fact, I had someone do that to me once, they put a utility bill in my name (college roommate). I raised holy H-E-Double-Hockeysticks with the company, they reversed it out.
“w/o approval and not wanted”
… and (usually) not secretly
‘Word has to get out that you can’t just abandon property,’ Funny words coming from folks who turned a blind eye to all the fraud that helped create the boom and the unaffordable prices and wacked out debt.
It was no secret that mortgage fraud and bogus appraisals were rampant, but city and state officials all across this land sat with their thumbs in stinky orifices doing nothing but counting the tax dollars rolling in. Now the chickens are coming back and these dorks still don’t see their own part in the mess, they’re just fretting that their tax revenue might go down.
The prosecutors missed the biggest crimes on the way up and now they’re going after the wrong people on the way down. They’re just as greedy as the mortgage brokers and appraisers who made this mess in the first place. All they care about is trying to maintain the charade of their artificially inflated tax base.
Very elegantly put, climber. Everyone is trying to put the fake economy on life support, instead of taking a good look at what went wrong and changing the fundamentals to something more sustainable.
The whole economy is a Potemkin village. There is a lot of pain ahead, and it will be a long time before I feel good about it again.
Your comment is so good, it may be presumptious of me, but…
It takes a “Potemkin village” to wring the “irrational exuberance” out of this economy that’s the “greatest story never told”.
Agree that prosecutors have been asleep on the job while rampant fraud was being perpetrated in the housing market, but disagree that Judith Northcliffe and her ilk are “the wrong people” to be going after. This greedy, stupid cow “buys” a house, sight unseen, then thinks she’s just going to walk away and let it deteriorate when her get-rich-quick scheme evaporates? Wrong answer. If you lived next to one of these vagrant-magnet properties, you, too, would want to see these dirtbags standing in front of a judge and held accountable for their actions and obligations. Similarly, FBs that trash their foreclosure houses should get the book thrown at them and be held fully liable, criminally and financially, for the damage they do.
Crooked mortgage brokers, real estate agents, and appraisers are the real villians of the piece, and should be ruthlessly held accountable for their actions. But don’t give a pass to all the greedy, irresponsible idiots who were ultimately responsible for inflating the bubble and causing more responsible parties to be priced out of the market. They definitely deserve to get their name on the Court section of their local newspapers.
I see your point. I’m just peeved that the powers-that-be sat on their hands while all this was working in their favor.
“The best buyers are the ones that don’t own any real estate”
LOL! I guess after you’ve been around this steaming pile we like to call the Housing Bubble long enough you were bound to hear that! There was a point long about 2005 where I predicted we might see a program like the car dealers have used for years where the neg. equity is simply rolled into the new car loan? Ha! They can’t eat the neg. eq. on the table NOW!
“That figure — coupled with a doubling of foreclosures during the first quarter of this year over the same time last year — is by itself cause for concern, say experts, but more worrying is that nearly 11,000 of those delinquent mortgages are prime loans.”
“‘It is spreading. It is not just a case of problems in the subprime,’ said Dan Smith, director of housing research for the NHHFA. ‘We’ve seen this increasing since 2007.’”
And that is with fairly low unemployment figures. Wait until the jobs really start evaporating….
Tag on toe says “Atlas”. DOA. Debticide.
“Judge Thomas M. DiMillo sentenced a former homeowner to fines and community service Tuesday for his part in the deterioration of a property that he lost to foreclosure. DiMillo also warned the former occupant of another vacated home that she, too, faces consequences for walking away from title-holder’s responsibility.”
Debtor Prison is making a come back, along with govt approved torture. Before debtor prison was slavery. We are falling back to like it was before the French Revolution. If you are in debt, then you will be sentenced to forced labor for the state, or your master.
http://en.wikipedia.org/wiki/Pillory
Such delightful, lost tools of justice as the stocks, the whipping post, and public pillorying need to make a long-overdue come-back. For crimes such as malicious vandalism (not sure there’s any other kind), the offenders should be publicly flogged or caned - it would send out a clear message to dirtbags that society is no longer going to tolerate your crap. Flopped flippers who walk away from their properties and let them go to seed would see the light after public pillorying in front of a tomato-and-egg throwing crowd (before those food items get too expensive). Shyster mortgage brokers, appraisers, and realtors (redundant labeling, I realize) might think twice about defrauding the drooling imbeciles called the American public if they saw some of their number peering dolefully out from heavy medieval stocks in every public park, subject to public scorn and ridicule.
How about throwing mud and dung and saving the eggs and tomatoes. Then we can all have omelettes after the fun.
I’ll bring the tar if you bring the feathers.
I’ll bring the gas to heat the tar. On the appointed day, just give me an hour to find an open house, a realtor’s SUV, and my siphon hose.
And for the FL watchers, the teacher who was recently fired for working on a bikini charter fishing boat (or perhaps it was the 30+ days of work she missed… hmmm…) now has an offer on the table from Playboy that will probably pay into the mid 6 figures (25K per picture).
Only in America can you be a lazy, irresponible sh**, lose your job, and then get an offer making 100X as much because you’re hot.
If there’s such a thing as the after life, please, please, let me come back as an attractive women in South Flordia. Talk about having the world at your fingertips, man..
Living in LA, I have gotten to know many overly attractive women who rely on their looks and trust me, these creatures are the most screwed up beings on the planet. This woman will probably do her Playboy shoot, squander her money on bling, and then end up trying to prostitute herself to the first rich guy she can find. Within 20 years she will have lost her looks and then spend the rest of her life in a desperate attempt to get them back. If she’s lucky, she’ll end up working at a Wal-Mart and living in a trailer home…if she’s unlucky, she’ll end up homeless. The laziness of these women comes back to bite them on the butt eventually.
Don’t forget, she ‘ll have a stint as a real estate agent as well.
Or, she could end up as one of the the “Real Housewives of Orange County”, with a big house, horrible marriage, and three spoiled children. The one who used to be a Playboy centerfold is now a real estate agent…
“If she’s lucky, she’ll end up working at a Wal-Mart and living in a trailer home…if she’s unlucky, she’ll end up homeless.”
Link, please??
Only in America?? Surely you jest.. hotness is a timeless and universally appreciated asset.
Yeah, but its pretty much depreciation throughout the life of it.
Marry now or be priced out of my appearance forever!
Speaking of Florida, anyone seen ByeFl lately? Ben…??? I recall him saying something about his long posts getting eaten…
He can’t post anymore–there’s no internet access in Oil City…
This is absurd - housing prices have an impact on affordability? Impossible - I was told many times by re-litters that: “prices no longer matter” and “it is a new economy” and so on. I guess not!
On the plus side, it looks like even the shills are waking up to the fact that this is no longer just a “subprime” problem and that housing will not “recover” for years. Their version of “recovery” - housing going back to being completely unaffordable and staying there - may not happen for a generation, if we’re lucky!
If the hit is hard enough, maybe not for centuries. Tulips have yet to recover.
“Tulips have yet to recover.”
LoL…Lawrence Yun would probably say that the price of tulips overcorrected and is artificially dragging down housing prices.
That was good!
“If there really is a silver lining in every cloud, first-time buyers are playing the only upbeat note in the huge black thunderhead that is New Hampshire’s housing market.”
Actually, my “silver lining” is in my safe and buried in my backyard. Along with my gold lining and palladium lining.
speaking of hidden stashes, a friend of a friend told me a story.. an old widow finally died of old age. She never spent much money it was generally assumed she was poor, and had just one small bank account.
The big old house is full of stuff accumulated over time… a real pack rat.
So, the sister has to clean the house in order to sell it. They hired a junkyard guy to come and get most of the stuff.. Some furniture was brought to Good Will, etc. and they just emptied the house except for a very few choice, major pieces of furniture and an upright piano.
Well, inside the piano is a packet of cash wrapped in newspaper.. bout $20,000. A search of what little remained in the house didn’t turn up anymore.
I have a friend like that, I’ve mentioned her here before. She was very poor as a young child during the Depression. She turns her car off at every stoplight to save gas (maybe a good idea). She eats stuff she doesn’t like cause it’s cheap. She’ll leave a handful of cereal in the box so she’s not out of cereal. She fusses over every penny she spends, literally. She cashed out big at the hight of the Boom and is ready to blow it all on an overpriced POS house, already bought one and is looking to move again and buy bigger. It’s what’s called living a balanced life… /saracsm
Similarly, a relative by marriage told my wife and I last Christmas not to throw anything away if something happens to her. There are various valuable things and wads of cash hidden throughout her house. Some even she doesn’t know about.
I don’t need the money, but I’ll take a good old fashioned Hardy Boys treasure hunt any day!
Why is this housing bubble taking so long to hit the New England area?? I am in Hillsbourgh county and houses are still very high, people seem to think their 900 SF cape is worth 225K!
Fence sitter trying to be patient…
I picture it like being at sea on a small ship with a hole in the bottom. At first the pumps take care of it.. after a while the pumps run out of fuel. Then the crew grabs buckets and bails. that last for a while.. but they get tired so the passengers have to bail. They’ll stay afloat until the food and water runs out.
There are various massive, cooperative forces resisting a decline in property prices… just gotta wait till they run out of energy.
CorpsmanUSN,
Patience is hard to keep in Mass. There are other factors that haven’t hit us that hit FL and CA. For instance, its way easier to develop in FL than MA or NH. We have very well entrenched local govts whose NIMBY-ism means it takes years to realize a development project. Usually 3 years is a QUICK turnaround and more likely its 5-7 years. So we’ve had less building than other states. Also, Mass. and NH has a strong economy… mostly NH’ers and Western Mass-ers driving down 93 and / or 128, accepting 1.5 hour commutes each way. So what needs to happen is the gov’ts in these areas need to make it easier to build. Sellers are also way more stubborn here. Have hope, wait it out!
It isn’t just the local governments. It’s the people who live in the towns who don’t want to have them wrecked. Yes, it’s inconvenient when you want to build a garage, or install an air-conditioner, and have to get it approved by the historic commission, but still. I’m glad MA hasn’t experienced the rampant, greed-driven development that has wrecked other parts of the US.
“We have very well entrenched local govts whose NIMBY-ism means it takes years to realize a development project…So what needs to happen is the gov’ts in these areas need to make it easier to build.”
MA is one of the few states (commonwealths) in the USA that is actually losing people…
Another force for the bubble crashing - they have less people
I live in Hillsborough County too. There are still a lot of good jobs here though folks are worried. There are many here that survived the housing bubble bust in the late 1980s and early 1990s and live frugally. I see no chance of a housing recovery in 2009. Which most likely means that housing will decline. But yeah, it feels like chinese water torture if you want to buy. I know people in the same boat and they are electing to continue renting while looking at houses on the weekends.
Why is this housing bubble taking so long to hit the New England area?
http://www.boston.com/news/local/articles/2007/04/28/as_us_lags_economy_in_mass_soars/
The Mass economy grew at 4.7% in the first quarter. Unemployment is growing in some industries, but is being offset by strong hiring in Technology, Scientific, and Medical.
http://www.southcoasttoday.com/apps/pbcs.dll/article?AID=/20080508/NEWS/805080362
Foreclosures are increasing dramatically, but so far have hit primarily urban centers and low income households. A recent article showed half of all households being foreclosed in Mass are renters… investors and speculators are getting hammered while SFH prices in the suburbs are showing modest declines.
It will take heavy job losses and more foreclosures in the burbs to move prices down quickly on desirable housing here. Otherwise, it could be years…
Anecdotedly, I can tell you my company has had a very difficult time hiring Ruby programmers… they can pretty much name their price. Other companies are experiencing the same shortages of skilled tech labor in and around Boston.
Also, word from one of the major landscape nurseries in the Northeast is that sales are up over last year (so far) and that the Cape and Islands are pretty strong in terms of orders. Personally, I think they are benefitting from the loss of competition (many smaller nurseries have folded) and are pretty much the only game in town for landscapers and well-off retail customers to get what they need. I also heard they moved to COD for many of their business accounts. No more credit for landscapers. I guess cash is king…
Nice post, Northeasterner. Thanks.
Nice post.
Renting is the only way to go here. I refuse to pay what people “think” their houses are worth. In a perfect world the houses would go back to 2-3 times your income. This area has quite a way to go!
Friends of mine just sold their house in Jamaica Plain area of Boston for a little over 800K (it’s on Pershing Road across from the Pond–a nice location, so I’m told). I was amazed that they could unload it in this market….
….of course, they are jumping from proverbial frying pan into proverbial fire, as they are moving back to San Francisco.