Buyers Are Quick To Pick Up On A Softening Market
The Times Tribune reports from Pennsylvania. “A white banner advertising Silvana Hogben’s real estate business overlooks the waiting area. It begins: ‘Su casa, la inversion mas importante de su vida,’ relaying to the office’s mostly Hispanic clients that “Your house is the most important investment of your life.’ The phones are silent. The cooling seen in once-scorching housing markets in Nevada, California and Florida has settled on the local market as well. It cuts into Ms. Hogben’s business, sends waves through her personal life and weighs heavily on her consciousness.”
“‘I’m getting more nervous now. I’m getting nervous because there’s really nothing going on,’ she said. ‘Personally, I want to hang in there. I still have a few deals, but it’s not the same volume.’”
“After the Sept. 11 terror attacks, she saw the need in the Hispanic community as house hunters sought an alternative to living in New York City. Ms. Hogben prides herself on being the area’s first agent catering to that demographic, which she estimates still comprises 90 percent of her customers.”
“Potential customers are saving less and have more difficulty finding loans in today’s stressed financial markets. Many settle for apartments instead of purchasing homes, and those few who do venture forth into the market settle for cheaper houses, meaning leaner commissions.”
“‘Lots of people are losing their jobs. It’s sad because these people are so desperate, but it’s also going to hurt me,’ said Ms. Hogben. ‘I was talking to some of my colleagues, and everybody is very, very concerned, worried about the situation.’”
“‘Before I used to pick people up and drive them to the houses I was showing,’ she said. ‘Now, I just tell them, ‘I’ll meet you there.’ You’ve got to cut back on everything pretty much. Gas prices are killing everybody.’”
The Detroit Free Press from Michigan. “Up North destinations such as Traverse City, Petoskey, Charlevoix and Harbor Springs still command serious money in resort real estate. Those areas, in demand from more than just Michiganders, have largely avoided the worst effects of the housing bust. The tide is starting to turn, however, as the northwest corner of the Lower Peninsula is beginning to see the impact of the national housing industry troubles, said Dan Elsea, president of brokerage services for Real Estate One in Southfield.”
“‘Traverse City, Petoskey and those areas have gotten more independent from metro Detroit economically. They were sheltered a little bit from the changes,’ Elsea said. ‘But Chicago, St. Louis and other feeder markets for those areas have been hurt,” reducing the number of buyers in the market.’”
“Housing inventories in five counties in northwest Michigan have risen 68.5% in the past year and have nearly doubled over the past two years. There was a 35-month supply of single-family homes on the market at the end of May in Benzie, Kalkaska, Grand Traverse, Antrim and Leelanau counties at the current sales pace, according to Real Estate One research.”
“And the number of properties closing at the end of May compared with a year ago was down by 40%. More revealing is that while the median price of homes listed on the market in the counties has risen by 1% to $199,900 in the past year, the median price of those closing fell by 8.3% to $154,900 since May 2007, indicating sellers are accepting price reductions to sell.”
“Realtor Charlotte Arnold said the buyer’s market means people can get on the water for less. But they can’t do it for 50 cents on the dollar. ‘Some people are coming into the market expecting to find a $1-million home they can get for $500,000. That’s not going to happen,’ Arnold said.”
“But they can still get a deal on homes in that range. Arnold has a listing with 160 feet of Lake Michigan frontage for sale in Kewadin. It was once listed at more than $1 million and now is priced at $849,000 after three years on the market.”
“‘It has a sugar sand beach for miles, thick woods and every home in that neighborhood is worth $1 million plus,’ she said. ‘We’ve really reduced it to a price to create some interest. The land alone is probably worth that.’”
“Michael Fournier remembers getting calls years ago at his East Tawas real estate office from people wanting a lakefront cottage for around $100,000. ‘We used to laugh,’ said Fournier. ‘Now, we have some.’”
“The housing bust, credit crunch and $4-a-gallon gas have hit the second-home market hard Up North. For those buying lakefront or a cabin in the woods, sale prices are reduced and often include extras that would have demanded premium prices just two years ago.”
“Brad and Stacey Gingrich of Charlotte near Lansing are trying to sell two homes Up North. Brad has been trying to sell one in National City since he and Stacey married in 2002. That’s leased now but may go back on the market again soon. And they are trying to sell their home in Au Gres that’s on a canal leading into the Saginaw Bay for $189,975. The three-bedroom, 1 1/2 bath home was appraised for $234,000, but the Gingriches keep dropping the price.”
“They lived in the Au Gres home until 2006, when Stacey Gingrich transferred to the Lansing territory for her job. ‘We will have to write a check to sell it,’ Brad Gingrich said. ‘I can’t afford to pay three mortgages and three sets of taxes. We pay $700 a month in taxes alone.’”
“The situation is similar in the Houghton and Higgins lakes area, said Lexy Van Deneede, a real estate agent and office manager for Real Estate One, Points North. Home prices are down by at least 18%, she said. ‘The second-home market up here has never been overpriced,’ she said. ‘We cater more to the blue-collar crowd.’”
“And that crowd is thinning. Van Deneede said there were 35% more homes on the market this year than two years ago in the lakes area as laid-off autoworkers put their second homes up for sale. She counted 1,250 houses on the market right now, with 166 properties boasting waterfront on Higgins, Houghton or James lakes.”
“‘There isn’t a street you can go on where there aren’t any houses for sale,’ Van Deneede said.”
“Linda Popevich, an Ann Arbor-based restaurant industry consultant, has been trying to sell her cottage on Houghton Lake for nearly three years. She’s traveling more for her work and does not have much time to enjoy the cottage.”
“It was listed at $235,000 and now is priced at $179,900, making it one of the lowest-priced on the lake. The 750-square-foot cottage comes furnished and has a new roof, a dock and a beautiful lakefront view. ‘I have had offers,’ she said. ‘I’ve had curious offers like people wanting to swap out cottages with me or buy it on a land contract. I just need to sell it. I want someone else to enjoy it.’”
“Other sellers are pricing aggressively for faster sales. Betsy Levasseur bought a home in Wilbur Township near East Tawas on five wooded acres 25 years ago to retire in with her husband. After her husband died in 2006, she couldn’t face going up to the house by herself. She debated for a year and then decided she had to sell it.”
“While it was appraised for $229,000, she listed it two months ago at $199,900. It has two bedrooms and 1 1/2 baths and is 1,846 square feet. So far, there hasn’t been much interest in the property. ‘It’s close to East Tawas. The beach isn’t too far. There is so much to do up there,’ Levasseur said.”
The Post Crescent from Wisconsin. “The open concept ranch has new carpeting and fresh paint, extras like a gas fireplace, and it’s listed at $159,800, well below a real estate agent’s estimate. The Appleton house has been on the market since last fall.”
“‘It’s taken longer than I hoped,’ said homeowner Phil Zoellner, who is listing the house for sale by owner.”
“For sellers like Zoellner, better days may be ahead. According to one analyst, a market recovery could begin within months. David Clark, a professor of economics at Marquette University who analyzes market data for the Wisconsin Realtors Association, said he expects the Wisconsin housing market to bottom out in the second or third quarter of this year. He expects state markets to pick up later this year.”
“‘It won’t surprise me to see the first quarter of 2009 be better than the first quarter of 2008,’ he said.”
“Speaking Friday at the 2008 Wisconsin Housing Conference at the University of Wisconsin-Madison, Morris Davis, an assistant professor of real estate and urban land economics at UW-Madison, said Wisconsin has a higher income-to-housing-cost ratio than other areas of the country. He said that’s not necessarily a good thing for the state’s future.”
“‘I look at these numbers to be disturbing,’ Davis said. ‘It means people aren’t rushing to move in. Why aren’t people moving in if it’s a great place to live?’”
“Clark called the first two months of 2008 ‘extremely weak,’ which he attributed in part to the weather.
‘People don’t like to look for houses when the snow is flying,’ he said.”
“Clark said Wisconsin housing inventories have grown, but a recent Realtors survey indicates sellers are becoming more motivated. ‘It’s taken a while for sellers and buyers to get on the same page,’ he said. ‘Buyers are quick to pick up on a softening market. Sellers are reluctant to believe that the prices they could have gotten two years ago are no longer accurate.’”
“Zoellner has learned two things in his time as a seller: ‘They expect everything to be perfect and they expect it to be a good deal. It’s a buyer’s market.’”
“The situation is similar in the Houghton and Higgins lakes area, said Lexy Van Deneede, a real estate agent and office manager for Real Estate One, Points North.
Home prices are down by at least 18%, she said.
The second-home market up here has never been overpriced,” she said. “We cater more to the blue-collar crowd.”
Total horsecrap. Those auto workers overpaid for years for their up north homes away from home. And now they and all their agent pals up north are looking for someone to bail them out.
According to one analyst, a market recovery could begin within months. David Clark, a professor of economics at Marquette University who analyzes market data for the Wisconsin Realtors Association, said he expects the Wisconsin housing market to bottom out in the second or third quarter of this year. He expects state markets to pick up later this year.”
What exactly is going to change to make this happen?
“What exactly is going to change to make this happen”?
That’s just it, these so called professors of economics can not back up their statements with solid data. The thing that really ticks me off is no one calls them on it. They trot out these meaningless comments in a newspaper quote and some air head prints it right up. Oh he’s a ‘professor’ he must know what he’s talking about… They are some of the most out of touch. We have a long way to go to straighten out this mess, and all the D.C. crowd will do is screw it up even worse.
It could happen if sellers drop prices to 2.5-3x income or below rent prices. It will bottom and go sideways for years until the credit bubble is digested and pooped out
yeah, 50 cents “on the dollar” comments are delusional.
i never spent $300 per sq. ft.
Dave-O, you’re a real meanie. The nerve of you, trying to get these analysts to back up their predictions with some substance.
Positive thinking, what else??
I’m here in Madison and all I can tell you is there is some major kool-aid drinking going on, very similiar to the summer of 2006 in Florida. Wisconsin has RIDICULOUSLY high taxes, which don’t seem to be used on anything–roads a wreck, weeds and trash along streets, snow removal non-existant–except for schools, which don’t look so hot to me (and test scores are worse than IA, NE, SD).
Prices are going to FREE FALL in this cheezy state, no matter how many big-haired pants-suit-wearing soccer moms scream “we’re different!”
Hell, even the beer and cheese are overpriced here! Sheesh!
So sellers are lowering price enough..
Banks are not handing out money based on a pulse..
And inventory is sky high…
SO…..How..exactly is there suppose to be a recovery…
I’M SO CONFUSED!!!!
You’re waaaayyyyy overthinking this. Didn’t you see those fabulous month-over-month numbers? Why, this unpleasantness will be all over by October.
/sarcasm off
Paid whores doing what they are paid to do. Nothing more. Nothing less.
“Clark called the first two months of 2008 ‘extremely weak,’ which he attributed in part to the weather.
OMG, didn’t David Lereah also blame weak sales in the Northeast US within the first three months of 2007 on the weather?
“Clark called the first two months of 2008 ‘extremely weak,’ which he attributed in part to the weather. ‘People don’t like to look for houses when the snow is flying,’ he said.”
But Wisconsin had no snow, ever, in January and February in the bubble years? What’s the excuse for May and June - floodwaters rising, July and August - mosquitos?
Truth be told, Wisconsin and northern illinois did get socked this year with snow, and that’s gonna reduce sales a little bit. Note: I said, “a little bit.” I think Madison had something like 100 inches and that’s way above normal.
But then you would expect that by April as the snow melts and the little birdies start cheeping that homes would be flying off the shelves to make up for the slack. They aren’t.
“Truth be told, Wisconsin and northern illinois did get socked this year with snow, and that’s gonna reduce sales a little bit. Note: I said, “a little bit.” I think Madison had something like 100 inches and that’s way above normal.”
A little more than double the average is impressive, not great for house hunting. But as you noted, if it was only the weather the sales would have been made up after the winter which hasn’t happened.
Now the weather is unseasonably hot in the Northeast. I would normally like to have fun pointing out to the cold-state bashers here who bragged all winter about how only an idiot would choose not to live in the Sunbelt:
We’re having a great summer we’re having…70 degree, looonnng days, lots of outdoor fun in our lakes streams and rivers, and lower cost of living, while you steam and boil alive, suffer brownouts, and flock to malls, crowded chlorinated pools, and theaters to escape the heat.
But I’m bigger than that, so I won’t.
I found article in Newsweek and the following quote very interesting:
Lawrence Yun, chief economist at the National Association of Realtors, tells NEWSWEEK that “home sales and prices in most of the country will improve during the second half of 2008.” (Yun is the Little Orphan Annie of forecasters. He’s always sure the sun will come out tomorrow.)
Little Orphan Annie Yun, how funny!
Looking for his (sugar) Daddy Warbucks, no doubt.
If he means that prices will improve by falling to levels that allow ordinary schlubs to afford a house, then he’s worth listening to.
Idiots like Larry Yun are good for one thing. When this dipshit goes negative you’ll know we are close to the bottom. It will be at the point when he has lost so much credibility that he will be forced to admit housing is a bust. It also means the last of the bulls are washed out.
We are getting there, but he isn’t caving yet.
“‘Some people are coming into the market expecting to find a $1-million home they can get for $500,000. That’s not going to happen,’ Arnold said.”
She means its not going to happen THIS year. My guess is that sooner or later she will figure out that a $60K commission isn’t going to be in the cards either.
The agents just love all variations of that tired hyperbolic defense of high prices: “they aren’t just going to give them away”.
Too bad the agents won’t admit their little secret - that they are probably the ones making the lowest offers of all. Ya just know they are.
Well, you can’t give them away because 6% of nothing is nothing and we can’t have that now can we.
Already happened in Jupiter Fl. well $900,000 that went for $530,000
Aw..excuse..me but I can provide you PLENTY of MILLION DOLLAR BABIES that are NOW going for $500K..in SFL….
Eh, just wait several more months.
(I watched the Japanese real estate market drift down 40% or more off peak from my worm’s eye view in Tokyo, so anyone who says “X% discount isn’t going to happen” is, um, not knowledgeable about reality.)
“‘The second-home market up here has never been overpriced,’ she said. ‘We cater more to the blue-collar crowd.’”
“Overpriced” is a relative term. Maybe you didn’t go up to the heights of California, but that doesn’t mean there wasn’t wild and crazy appreciation for your traditional market. “Buy now or be priced out forever” affected virtually all levels of the market.
I don’t see my post yet about that same comment, but I said she’s full of crap.
Up north property has been insanely overpriced for years. Auto workers buying their home away from home paid top dollar for years. Over 500K for a house on Crystal Lake?? Gimme a break!!! The area’s nice, but not THAT nice.
Up north property has been insanely overpriced for years. That bears repeating. Both my parents were born & raised there, I spent a few years living in a state park there as a young child. We always loved the area. In 1950 my parents moved away because there were no jobs up there. Many of their friends and relatives did the same. The lack of jobs has continued for the last half century in NW MI, and the cost of living has gone through the roof. Many elders in NW MI counsel the young people to get educated and move away if they ever expect to get decent employment.
For a taste of what the real estate prices in NW MI are, check this out.
This shack has been in Northport forever & was originally part of a small motor court, with detached cabins, just off M-22 as it enters Northport (Leelanau county). About 1998 the cabins were sold off as detached dwellings, advertised for $29,000 each, for their size, grossly excessive even then. Now in 10 years their price has been marked up almost 300%, but the quality has not improved IMO.
There’s a long-term structural problem here as well. Newly-hired auto workers will have their hands full paying their FIRST home’s mortgage, let alone a second. Those were nice days, but they’re so GONE.
I’ve been wondering if the new hires will be able to buy a house at all.
I’ve been wondering just how many new hires there will be.
Recently published GM/Ford sales figures of volume down only 30% are BS. Might have been true a month ago, but nobody’s buying big SUVs and trucks now. Sales have fallen off a cliff.
What’s fascinating to me is that US gas prices are still less than we paid here in Canada a year ago, but the reaction to price change is much more extreme in the US.
I suspect it’s because everyone was already spending every penny they made and more, so the addition of another $200 per month of costs is breaking people.
Personally, I drive a new Civic and work is 10 minutes away. I could pay double for gas without it hurting.
Problem is, people ARE buying new SUVs, because the dealers are dropping the prices way below the Mfg. list to move them off the lot. So, even with $4.50/gal gas, I’ve seen at least two of these new monster Mos in my neighborhood, which probably makes some other twits think maybe the lower cost will even out gas prices, since they’ve been aspiring for one of these $45k beasts for years, and now they’re “only” $35K. Same phenomena with housing sales numbers reported this week. The MSM is declaring the worst is over because folks are getting suckered by “deep discounts” off of hugely inflated bubble prices.
No offense, but this is how the whole lake shore (Huron) with all its mostly old cabins feels. Left over from days long gone. There’s what, 200 miles of ‘cabins on shore road’. You spend 10 dollar in gas if you forgot to buy milk. You’d have to pay me to ‘vacation’ there.
Wait until the guy while sitting on his deck has his first double skip on his EKG, it takes him three hours to get to a legit hospital and by that time he lost 1/4 of his heart mussel…For sale sign in the ground the next day…
Traverse City is more than 300 miles away from Chicago, and what, 600 from St Louis? I can’t imagine many people from down there decide Petoskey is the place to have your vacation home.
But even from Chicago, it’s not exactly a hop, skip and a jump away. And now, with gas prices the way they are, it’s much more likely the few people in Chicago who’ve got the dough to spend will go to the SW coast or somewhere in Wisconsin.
Anyway, point being that NW michigan is gonna be in some serious trouble.
There will be some impact from what happens in Chicago. St. Louis, I doubt. Maybe more with eastern Wisconsin, but if Chicago takes a dive, all of west Michigan will feel it IMHO.
There’s already a 35 month supply of SFH in NW MI? Damn skippy they’re going to be hurting for a long time. An awful lot of agents are gonna grow old waiting for that fabled Windy City equity to come along.
I know a lot of people who have cancelled vacation plans because of the price of gas. They’re also nervous about whether they will have a job next year, and trying to just adjust to a universally rising cost of living.
I hope the second home market takes a real bath, just so that the rural real estate agents around the country get to chow down on some barbequed crow when they roll out their chromed propane monster grills this summer.
I just want someone else to enjoy it.
So says the lady who wants to sell her 2nd house.
Re write says,
I just want someone else to pay the bills, so I dont’ have to.
Lots of friends, acquaintainces are worried about their jobs.
Pilot neighbor is worried that senior pilots have displaced him onto the reserve list. Which doesn’t pay as much (caveat:pilot pay is different) however, it is affecting everyone.
Medical transcriber friend has not had job for 1 month. I mean really, are transcribing jobs also disappearing that rapidly…guess so.
At least disappearing for US workers.
$179,900 for 750 sqft ? No thanks. Let me know when it’s selling for $40K and I’ll be interested.
I mean really, are transcribing jobs also disappearing that rapidly…guess so. I thought all the USA transcribing jobs had been outsourced to India. I’m surprised there are any domestic medical transcribers left.
I knda have some empathy for the pilots…Not only are things getting difficult but it appears the airline industry is facing a monster consolidation which means many of them will lose their jobs…
Heh heh… Even the Self-Loading Freight supports the pilots! Good! This brings to mind an old Dilbert strip about company cost cuts and pilots (and Catbert).
“I know a lot of people who have cancelled vacation plans because of the price of gas.”
A co-worked just mentioned that they canceled their summer vacation because fuel would cost them an extra $300 this year. I thought… winters up here are long, and you take one vacation per year, but you cancel it because of an extra $300? Light bulb moment clicks… they must be in hock up to their eye-teeth!
Exactly. They’ve already got one foot over the edge and it’s the straw that breaks them.
Or am I mixing my metaphors again? No matter.
Most people are leveraged up to the edge. Why do you think the problem is so large?
If you don’t even have a $300 slack in your annual budget, you really need to reexamine the assumptions on which your financial life is based.
“If you don’t even have a $300 slack in your annual budget, you really need to reexamine the assumptions on which your financial life is based.”
Have you considered running the Treasury? They need a man with new ideas like yours.
I have heard of more than one family cancelling plans to go to the beach in NC or SC due to gas prices as well. I remember saying the same thing, that if a few hundred extra dollars means that the trip is off, you shouldn’t have been planning the trip in the first place.
I think many millions of people are going through a difficult adjustment that they have fallen out of the middle class, or else the middle class lifestyle is very hard to pull-off longterm whenever you are trying to do it all through easy monthly payments.
Far, far too many people feel entitled to have it all by the time they are thirty years old. Fancy home, fancy cars, fancy furniture, fancy tvs, fancy vacations and perfect little children in the best schools.
The adjustment will not be pretty, and will be hell on the economy as consumer spending has no option other than to come in line with consumer incomes. Housing will fall in line as well, no matter how many obstacles Bankers, Congress and Realtors throw in front of reality coming back into the picture.
Reality bites for a lot of people, and what sucks even more is paying 18% interest on an old tv, couch and tank of gas used to cart the little ones to some useless lesson or soccer game.
No, thanks.
I’ve worked (in the long past) for some pretty famous people (you’ve heard of them, I assure you), and all I learnt was that I have no future in politics.
Rosy optimism will win over the facts every single time.
“I think many millions of people are going through a difficult adjustment that they have fallen out of the middle class, or else the middle class lifestyle is very hard to pull-off longterm whenever you are trying to do it all through easy monthly payments. ”
————–
I think the problem is defining “”middle class” by having :”Fancy home, fancy cars, fancy furniture, fancy tvs, fancy vacations and perfect little children in the best schools.” (Isn’t that upper class, anyway?)
To me, middle class is a matter of education, basic manners, and an ability to function in society. If you have a bachelor’s degree and you are unemployed and broke, you are still middle class in my book. You didn’t suddenly change classes. Money doesn’t give you class and all the “fancy” stuff in the world won’t take the “white trash” out of some people, which is to say “lower class plus money does not equal upper class”.
I am not trying to be classist or snobby, i just think our problem as a society is thinking that fancy material things define people as being a success or not.
and all I learnt was that I have no future in politics.
… and I would be a logical choice for your running mate. I calls ‘em as I sees ‘em, which is no way to run for office.
all I learnt was that I have no future in politics FPSS definitely has no talent for flattering people.
We just had this discussion last night. I was saying that there are going to be millions of angry bitter people out there having lost their faux status and having to go back to what they were before they started pretending to be someone else. Society doesn’t function the same with so many frustrated stressed out people. It will effect everyone regardless of their housing or job status just having to deal with all the underlying rage.
If my summer vacation costs me as much as $300, it’ll be because I splurged.
“I know a lot of people who have cancelled vacation plans because of the price of gas. They’re also nervous about whether they will have a job next year, and trying to just adjust to a universally rising cost of living.”
The San Diego frwy (405) from Los Angeles to San Diego on a beautiful, beach weather, Sunday afternoon in June was like driving roads that I remember as a kid in the 1950’s. NO CAR TRAFFIC.. It was bizarre. A very errie feeling.
An estimated 2 hour trip to Huntington Beach became 1 hour at 80 MPH all the way. The party is over.
Funny, I disagree with all the comments in this thread, with the exception of Arizona Slim.
I run a very tight household budget. I’ve never been in debt (other than a mortgage), paid for new and used cars with cash, etc. I’ve never made anywhere near a six figure income yet have savings/investments now amounting to more than 10X annual salary.
Would I cancel a vacation because of a *lousy* 300 bucks? You better believe I would. This despite the fact that I’ve enough cash on hand to be jobless for 15-17 years or so at my current rate of spending.
I guess what I’m saying is that perhaps not everyone who is canceling their vacations this year is in hoc. In fact, they might have considerable wealth and have decided NOT to go on vacation because they can’t justify the cost on principle.
“$179,900 for 750 sqft ? No thanks. Let me know when it’s selling for $40K and I’ll be interested.”
I know Linda Popevich. Part of the problem is that Houghton Lake is A LONG WAY from anything else and it never was “the” address to go to. I’d be quicker to look at a significant mark down in Harbor Springs which has been a resort community for more than 100 years.
“trying to sell their home in Au Gres that’s on a canal leading into the Saginaw Bay for $189,975. The three-bedroom, 1 1/2 bath home was appraised for $234,000, but the Gingriches keep dropping the price.”
I wonder if that is even close to a market clearing price. There needs to be economic growth to drive people into the area, it doesn’t seem like a retirement mecca. Anyway they could have rented the third house, until they could unload one or both of the first two.
The distance of Traverse City from anywhere brings back a couple of nice memories from my University of Michigan days. One was of a college ski trip. We went up to the Leelenau (sp?) Peninsula, which was a long, long ways from dear Ann Arbor town. I honestly thought that we’d never, ever get there. We must have driven for six or seven hours.
The other memory was of a weekend bike ride along Lake Michigan with an Ann Arbor club. Again, it took forever and a day for us to drive up to Petoskey, which was our base of operations for the weekend. The trip back to Ann Arbor was also quite the drive.
A 4 hour ride through the Mojave desert is entertaining by comparison.
I’ve driven through both the Mojave desert & the upper LP of MI, I much prefer Michigan.
I haven’t lived in MI since 94, but back then the drive “up North” was excruciating. I-75 and US-23 were just simply packed with cars. If you were going up from Lansing or Grand Rapids it may not have been so bad, but for anyone in the greater Detroit metro area it was just ridiculous.
There is no way I’d buy property that required a drive in that much traffic.
There are plenty of nice lakes in the Jackson area.
If you were going up from Lansing or Grand Rapids it may not have been so bad Going up from Lansing was also bad. I used to live about 15 miles north of Lansing right on US 27. Friday nights going north & Sunday nights going south were regular traffic jams every summer.
I’ve read that before auto travel supplanted rail travel, tourists had to travel from Chicago & southern MI to Traverse City & Petoskey by rail during the summer. Friday night trains going north were packed, as were Sunday night trains going south. Mothers with children would often stay up north for several weeks, while fathers would commute back & forth so they could continue their weekday jobs. The locals would provide services to the scattered cabins along the lake shore, delivering tourists, ice & food by horse drawn wagons. Cabins often as not had no plumbing & no electricity. Lack of electricity was not a problem at that latitude, where night didn’t fall until 10:30 pm and it got light about 4:30 am in the summers. People rented boats up north rather than hauling them there. The author Bruce Catton wrote a memoir of his early years in Benzie County, titled “Waiting for the Morning Train.”
UPDATE: If anyone remembers my post about my neighbor wanting to sell her house (SFH) in Thousand Oaks, Ca. here is the update.
She has a (very) close friend who’s son is a realtor. In fact, she has known the realtor all his life. Obviously, she intends to use him to handle the sale. Cut to the chase:
The appraisal came in at $575,000. At the peak it was $725,000. Nice haircut there for any GF who bought at the peak. However, here’s the interesting part. The realtor told her, “We might have to haggle with the price. Not much is selling.” She then said, “Do you think the prices will go up in a year or so?” He replied, “There could be a bump but I think prices have a lot further to fall.”
Okay, this guy might be a gutter dwelling realtor but, because he’s dealing with a close friend, he’s not doing the usual realtor b.s, “Now is a great time to buy.” BTW, she bought the house in 1964 (when the American Dream was still alive) for $24,000 and, because of California’s Prop 13, pays a couple of hundred dollars a year in property taxes.
Calpers Rolls the Dice With Retirement Money
CalPERS Rolls Dice With Retirement Money
Speculative real estate investment burns pension fund.
Andrew Jeffery
Jun 09, 2008 2:30 pm
For years, federal and state workers, along with employees of large corporations, relied on the security of their pension funds for retirement. But facing demands for higher returns, fund managers have opted for riskier and riskier investments. For the California Public Employees’ Retirement System, or CalPERS, one such investment has turned sour.
The Wall Street Journal reports LandSource Community Development LLC, a partnership in which CalPERS owns a majority stake, filed for bankruptcy late Sunday. Although it secured a $135 million credit line from Barclays Bank PLC (BCS) to pay for bankruptcy-related expenses, LandSource’s future is still uncertain.
In February 2007, CalPERS dumped almost $1 billion into the venture, which owns a vast amount of undeveloped land just north of Los Angeles. The transaction netted $660 million apiece for homebuilder Lennar (LEN) and hedge fund Cerberus Capital, which had previously shared ownership of the investment.
CalPERS’ timing couldn’t have been worse.
Raw land was in high demand during the housing boom. Homebuilders churned out McMansions miles away from city centers as buyers were willing to travel long distances to and from work for bigger, safer, cheaper houses. Now, with the real estate bubbled popped, fuel prices at record highs and the economy slowing down, that same land is being dumped at pennies on the dollar.
Homebuilders, strapped for cash and incurring huge losses on falling land values, are trying desperately to unload unused tracts. Financial Week reports that last month Centex (CTX) sold three properties with a book value of $528 million to a group of hedge funds for $161 million. According to Moody’s, big homebuilders like D.R. Horton (DHI), Pulte Homes (PHM) and Toll Brothers (TOL) have written off almost $20 billion in land impairments.
All this adds up to a mess for CalPERS - the fund could lose its entire investment. The developer claims LandSource will emerge from bankruptcy and turn a profit when the real estate market stabilizes. It neglected to mention, however, when that impending stabilization would occur.
No positions in stocks mentioned.
Andrew Jeffery is an Editor at Minyanville Publishing & Multimedia, LLC.
cancelling vacation plans over $300 increase!? that is a canary in a coal mine moment.
“cancelling vacation plans over $300 increase!? that is a canary in a coal mine moment.”
Exactly right! I’m still shaking my head in astonishment when I think about it.
U.S. Economy: Pending Sales of Existing Homes Unexpectedly Rise
http://www.bloomberg.com/apps/news?pid=20601087&sid=aHy9EuohQVQk&refer=worldwide
“unexpectedly”= bs
And how many of those Pending Sales actually translate into SOLD…
hmm.. i can’t determine exactly what a ‘pending sale’ is except that it’s another bone with no meat on it.
Even using the generous measure of “pending”, it was still a decline from year ago “pending” “sales”.
“And how many of those Pending Sales actually translate into SOLD…”
In previous months, not that many. The eventual sales numbers continue to show year over year declines. Just another typical NAR attempt to mislead.
Interesting article from the NYT.
“This crisis really impacts those who are at the economic margins of society, mostly in the rural areas and particularly parts of the Southeast,” said Fred Rozell, retail pricing director at the Oil Price Information Service, a fuel analysis firm. “These are people who have to decide between food and transportation.”
A survey by Mr. Rozell’s firm late last month found that the gasoline crisis is taking the highest toll, as a percentage of income, on people in rural areas of the South, New Mexico, Montana, Wyoming and North and South Dakota.
With the exception of rural Maine, the Northeast appears least affected by gasoline prices because people there make more money and drive shorter distances, or they take a bus or train to work.
But across Mississippi and the rural South, little public transit is available and people have no choice but to drive to work. Since jobs are scarce, commutes are frequently 20 miles or more. Many of the vehicles on the roads here are old rundown trucks, some getting 10 or fewer miles to the gallon.
The South has been voting Republican since the 1960’s. New Mexico voted for Bush in 2004. Montana voted Republican 4 out of the last 5 presidential elections. Wyoming is 5 for 5. Same thing for North and South Dakota.
I find it pretty ironic that the people that voted overwhelmingly for the current crop of criminals is taking the most pain right now. And most of these people were strong supporters of the war as well.
It really is KARMA. Count me as a believer!
Hmmm, food or fuel.
All those agents still hawking those out of the way Sun Belt places due to the preceived lower cost of living better take note.
The problem is low-information voters. I frankly don’t expect any of those states to swing over, except Montana. The godgunsgays fear thing is INGRAINED by now. Sad to see, but I only have one vote.
Are you saying that they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations?
Elitist! You should be run out of town on a rail…
j/k
Southerners have less public transport, need to drive further to work and therefore suffer the most from higher gasoline prices.
Southern states voted GOP.
Therefore the South suffers due to voting GOP.
wow..
It’s called KARMA Joey. I find it hysterical that the same boobs that helped wreck this country are getting the enema of their lives. These are the same people that were overwhelmingly for the illegal Iraq war. In fact, they didn’t want to hear any dissent either. Called us unpatriotic for even daring to mention the simple fact the war was complete bullshit. How many died Joey? Hundreds of thousands of innocent people, that’s how many! Am I pissed about it? You are damn right I’m pissed off. In fact, I’m even more pissed off that ALL AMERICANS are not pissed off. WTF happened to this country?
The red state support for Bush and this bullshit war enabled him to commit a massive war crime. And he bankrupted the USA at the same time. You’d have to be pretty unpatriotic NOT TO BE PISSED at this point.
So yes, seeing the red state dipshits get the enema of their lives is KARMA. Face it, most of the red state’s went Republican in the 60’s when the Democratic Party pushed through civil rights for blacks. What a pathetic group of people those racists are.
The red states are getting EXACTLY what they deserve. And I sort of hope they vote GOP again, to tell you the truth. Why not? They still don’t get it. Let the GOP rip em a new one for 4 to 8 more years. And $10 a gallon gas would be awesome IMO.
Bring it on!
There are consequences for our actions. They are living theirs. Too bad so many others also had to pay.
Hundreds of thousands of innocent people, that’s how many!
wow again.. it’s no easy thing to distinguish between who is an innocent victim and who is suffering from bad karma. I’m both impressed and humbled by this display of divine wisdom.
Yes, we would have so much better off with Gore, if he invented the internet, surely he could solve this gas price situation.
I hear ya. Lots of hopeful buyers go under contract, and many fall out. But please don’t cloud the propaganda with logic and facts. That’s not fair. I heard Yun on the KNX News Radio Business Hour 10.70AM Los Angeles saying that if the loan is backed by the U.S. Govt (FHA, Fannie or Freddie) its a homerun on funding. What a BS artist.
Professor Morris Davis says that he finds WI having a relatively high income to housing cost ratio as “disturbing… It means people aren’t rushing to move in. Why aren’t people moving in if it is a great place to live?”
That sounds bizarre to me.
About Professor Davis:
“Before coming to UW-Madison, he worked for six years at the Federal Reserve Board in Washington DC, where he was responsible for briefing Chairman Greenspan on the state of housing markets. He was also responsible for developing new ways of thinking about the relationship of house prices, housing investment, and the macroeconomy for the purpose of enabling FRB staff to better understand the role of monetary policy on housing markets.”
(from his faculty webpage http://www.bus.wisc.edu/wcre/pdf/mdavisbio.pdf)
OT, but according to Financial Week, financial firms are using an accounting rule to book $12B in revenue after a decline in prices of their own bonds. This rule allows them to report gains when market prices for their liabilities fall. WTF??
Whoever holds their bonds takes the hit. The financial community is so incestuous it will show up somewhere close to home.
OT, but I just talked to a woman about renting a house. She has it priced a bit high, and when I talked to her about a reduced rate, she went on and on about how much her payments and taxes and upkeep are.
Not my problem. All I care about is the market rate, and she’s too high. Why don’t people understand even the basics of economics? Why does she think I give a rat’s ass about her house payment?
You should care about her payment - or at least her ability to keep up with it. Your lease is subordinate to her mortgage.
Yes - care please. We have to move because our landlord sucked the equity out and now doesn’t want to pay the reset amount so house is going back to the bank. The good news is we found a better place in a country club with 7 acre lake, 15 pools & spas. walking trails 3 bd, 3 bath, 2000 sq ft for $1650. Where we’re going in the desert, that’s a great rate. We are running a property & credit check on landlord, but he said he’s owned since 99 and hasn’t refied.
It sounds like you might have come across another (future) delinquent landlord. Your checking these names at your local recorder’s office or website, right? I would also check their home counties/states if that info is accessible. If they’re in default in some way in some California county, I am sure that the Utah note will soon follow. Of course, you know this more than anyone. Good luck.
Thanks, I’m just lucky, got Squatter’s genes.
BTW, Utah’s a non-disclosure state, so no way to know ahead of time.
BTW, next house I squat in better be nicer than this one. Just sayin’.
(dang thing doesn’t have a stove, frige, washer/dryer, or heater)
(and next thing you know, it’ll be up to me to fix something…or water the lawn…)
Who cares what the rent is? As long as you know the ropes and can cover your bases, deliberately pick some FB as a landlord.. the worse off, the better.
Get the squatting thing down to a science.. an art form.
“Morris Davis [snip] said Wisconsin has a higher income-to-housing-cost ratio than other areas of the country. He said that’s not necessarily a good thing for the state’s future.”
It’s a bad thing that we don’t spend a large chunk of our money on housing? I guess “a good thing”, according to Mr. Davis, would be spending every penny we can scrape together on it.
“‘I look at these numbers to be disturbing,’ Davis said. ‘It means people aren’t rushing to move in. Why aren’t people moving in if it’s a great place to live?’”
People are moving here. It’s just they built housing units faster than people are moving here.
Real estate people define good as people spending most of their money on housing and moving often. For anyone not involved in real estate, those are bad things. I wish media outlets would balance their comments by pointing out what’s bad for realtors might be good for many other people.
This ignoramus couldn’t find his ass with both hands.
Despite a recent spike in the nation’s unemployment rate, the danger that the economy has fallen into a “substantial downturn” appears to have waned, Federal Reserve Chairman Ben Bernanke said Monday.
Addressing a Fed conference in Chatham, Mass., on Monday night, Bernanke said a government report last week showing the unemployment rate rising from 5 percent in April to 5.5 percent in May — the biggest one-month jump in two decades — was “unwelcome.” However, the Fed chief said other forces should “provide some offset to the headwinds that still face the economy.”
The Fed’s powerful doses of interest rate cuts, the government’s $168 billion stimulus package, further progress in the repair of problems in financial and credit markets, a gradual ebbing of the drag from the deep housing slump and still solid demand from abroad for U.S. exports should help the economy over the remainder of this year, he said.
Although economic activity is “likely to be weak” during the current April-to-June quarter, Bernanke said “the risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”
Jesus Christ this man is an embarrassment.