The First Inning Of The Million-Dollar Market Plunge
The Denver Post reports from Colorado. “Andy Klein is a bargain shopper - on a huge scale. Since late last year, Klein has bought a few hundred lots for about half of what they sold for just two years ago. Klein is buying properties from banks and builders from as far north as Longmont and Brighton to as far south as Colorado Springs. ‘Homebuilders don’t want to hold inventory of platted lots or finished lots unless they believe they can be built on in the next three years,’ Klein said. ‘That leaves a lot of disposable inventory.’”
“The 10 largest public homebuilders reduced the number of lots in their inventory by 39 percent last year, according to the report by the real-estate investment arm of Deutsche Bank’s asset-management division. The majority of the decreases came from write-offs of land options.”
“‘There was a lot of speculative hoarding by homebuilders in the face of rapidly rising prices,’ said Robert Denk, an economist at the National Association of Homebuilders. ‘Now that it’s hit its height, it makes sense that a lot is going to get dumped at lower prices.’”
The Daily Planet from Colorado. “Wrap your head around this one. Right now in Telluride, real-estate sales volume is at its lowest point since 2003, and the number of properties changing hands has dipped to levels not seen since 1988. And yet, the average price of real estate has never been higher.”
“‘As much as we like to pretend that we’re recession-proof and believe that we’re recession-proof the national economy has an effect on us,’ said Lars Carlson, a broker with Peaks Real Estate.”
“And yet, home prices aren’t really budging.”
“‘Properties in this market do not lose value,’ said Judi Kiernan, owner of Telluride Consulting. ‘There’s a limited number we can’t make anymore. We’re not expanding like a Steamboat or Vail. I don’t want to sound like a Pollyanna, but the idea is, Is value falling? No, value is not falling. Expectations are being adjusted.’”
“Brokers say that buyers seem to be circling the airport right now, unsure about whether they should buy homes or wait another few months and hope they’ll be able to bargain sellers to a better deal.”
“‘Everyone’s trying to time the bottom of the market. They don’t want to be the guy who bought something and paid too much,’ said Matt Hintermeister, a broker with Peaks Real Estate.”
The Sun News from New Mexico. “Juan Arrendondo would like to own a house some day. The Las Cruces teacher, though, is engaged to be married and is not too sure a mortgage fits his life right now. ‘I do want to buy, but later,’ the 33-year-old New Mexico State grad said.”
“Arrendondo said he has researched a possible purchase but he and his fiancee have decided for now to rent a house near Roadrunner Parkway. The tightening of the credit market over the past year has caused him to delay taking on a mortgage, Arrendondo said. ‘Renting makes the most sense right now,’ he said.”
“Many are people who can’t afford to buy right now, thus houses also are taking longer to sell, said Cheryl Butler of Active Rentals. ‘I live on Topley (Avenue) and there are seven houses for sale within a two block radius,’ she said.”
“Jennifer Zappone of Landmark Real Estate said some builders have decided to put their homes up for rent while they try to sell them. ‘They’re trying to make the mortgage payment,’ she said.”
The Arizona Republic. “For decades, everyone assumed Arizona’s population-projection figures were reliable. Turns out they are not. Metropolitan Phoenix’s housing boom of 2003-06 skewed the state’s population numbers, leading to projections that planners, economists and government officials agree are inflated.”
“‘Population growth is the beginning of the food chain of Arizona’s economy,’ said Ioanna Morfessis, founding chief executive of the Greater Phoenix Economic Council. ‘But if the numbers are wrong, and I think the state’s population numbers are inflated, it’s going to be a house of cards for the economy.’”
“During the height of the boom in 2005, state and census estimates showed a record 196,000 people moved to the Phoenix area. But those projections, based largely on housing permits and occupancy numbers, didn’t accurately reflect how many people were moving to the Valley.”
“The large number of investor-owned properties inflated figures. And the number of building permits exceeded the number of houses actually sold. For example, a record 62,000 new homes went up in metro Phoenix during 2005 but only about 40,000 of those were bought by people who moved into them.”
“Jay Butler, director of realty studies at Arizona State University Polytechnic, says part of the current formula for projecting Arizona’s population assumes 1 to 2 percent of the state’s homes are vacant.”
“‘Now we know at least 10 percent of the new homes built during the boom were vacant, and foreclosures are leaving more homes empty,’ Butler said. ‘No one really knows how many homes are empty.’”
The Yuma Sun from Arizona. “The American Dream has become a nightmare for many Americans - Yumans among them - who got caught up in the real estate boom of a few years ago. ‘There’s more lower-end homes selling now,’ said Joe Wehrle, Yuma County Assessor. ‘We have a different picture. In the past, we had several upper-range homes sold. The top end just is not selling well.’”
“Michael Hall, broker for ERA Matt Fischer Realtor, said he thinks a better reflection of the market is a 20-25 percent drop in the average sales prices in the Yuma area in the past couple of years. ‘Prices have dropped in all the neighborhoods,’ he said.”
“With the inventory of homes on the resale market or being built, potential buyers have a lot of choices. Meanwhile, interest rates remain low and FHA loan levels have been raised to $271,050 through 2008.”
“‘That’s opened the door for anything under that price through the end of the year,’ said Hall. ‘There’s been so much negative media. But that’s national. Yuma is in a bubble.’”
The Daily News on Arizona. “Life hasn’t turned out to be a dream in the desert for the retired Queens man who moved to Arizona by cab along with his wife and two cats. Just months after Bob and Betty Matas last year made their cross-country trek and international headlines, Betty, 75, passed away.”
‘Now, Bob Matas, 74, says he can’t afford the payments on the house in upscale Sedona that the couple bought - and he’s moving into a trailer park.”
“The eccentric couple opted for a cab to Arizona in April 2007 in part because they wanted to start a promising chapter of their lives with an adventure. They also didn’t want to put their beloved cats through the ordeal of traveling in the cargo hold of a plane.”
“Matas said he recently consulted a lawyer because he was unable to get a loan. The value of his Sedona house at the foot of a mountain range had plummeted in the national housing market crisis.”
“His mortgage, credit card and other debts were substantial - his savings, modest. The lawyer urged Bob Matas to ‘walk away’ from his new home and let it slide into foreclosure, Matas said. He bought a $40,000 mobile home in a trailer park, also in Sedona, Matas said.”
“‘People are doing it all over the country,’ he said. ‘I never thought I would have to do it. It hurts, but what am I going to do.’”
“Matas doesn’t have an exact moving date. California transplant and friend Robin Briggman, who’s been helping Matas, said the move was unavoidable. ‘We looked at it from every angle,’ she said. ‘It’s just the way it is. It’s the bottom line. He’s off to the next chapter.’”
The Las Vegas Business Press from Nevada. “Vegas Grand, the local condominium complex in foreclosure, will finish construction next month. The 20-acre, 212-unit development is for sale. There is no official asking price.”
“‘We have been seeing strong interest in the property,’ said Geoffrey West, a first vice president with CB Richard Ellis. ‘This is the first fully completed vacant mid-rise condo project that has come to market.’”
“It cost $72 million to complete. There is also an adjacent undeveloped 16 acre tract, with entitlements for 782 more units. Its estimated value is $44 million, or $2.75 million per acre, which is 40 percent less than last year.”
“Lehman Bros. gained control of the project in October for $55 million, or $2.75 million-per-acre, after Orlando, Fla.-based developer Del American defaulted on its loan. The outstanding balance was reportedly between $90 million to $100 million.”
“Del American acquired the Vegas Grand property in May 2003 for about $4 million, or $200,000-per-acre. In 2004, the developer received $240 million in project financing from Lehman Bros. and Munich, Germany-based Hypo Real Estate Capital Corp.”
“At one time, about 90 percent of the project’s first phase…(which) started in the $200,000s, had been reserved. But Del American later canceled those reservations and raised prices by up to 50 percent due to market condition changes. It prompted a class-action lawsuit by buyers for breach of contract, fraud and deceptive trade practices.”
“Although the Vegas Grand was originally envisioned as luxury condos, the property is now expected to be used as apartments, time shares, student housing or hotel rooms. The project has been cleared of all encumbrances. The property is expected to be under contract by month’s end, with the deal closing by the third quarter.
“‘Although there is no official asking price, about $107 million has been spent on the development thus far,’ West said. ‘Unfortunately, we probably won’t recover every dollar from it due to the market conditions.’”
The Review Journal from Nevada. “Luxury homes in Las Vegas have held their value in a declining housing market in which one in every 44 homes has entered some stage of foreclosure, a local appraiser said. ‘I’m not so sure at $1 million, but at $1.5 million and up, it’s stronger today than it has ever been in this city,’ Scott Dugan of R. Scott Dugan Appraisal said.”
“The luxury segment from $1 million to $3 million is not looking quite as good, said Ken Lowman, broker and owner of Luxury Homes of Las Vegas. Sales dropped to 53 in the first quarter from 123 a year ago.”
“Homes that were valued at or near $1 million, including tract homes in upscale neighborhoods, have dropped back below the seven-figure threshold, resulting in fewer luxury sales, Lowman said.”
“Steve Hawks of ReMax Platinum said the luxury housing market is about to be butchered in the ‘million-dollar massacre.’”
“He said so-called ‘jumbo loans’ have all but dried up because of the massive amount of mortgage fraud that found Las Vegas at the center of an FBI investigation. Jumbo rates have increased by a point or two and the borrower has to put down 15 percent to 25 percent, Hawks said.”
“Homes with artificially inflated values are now going into foreclosure or short sale, Hawks said.”
“‘We’re in the first inning of the million-dollar market plunge,’ he said. ‘We see some examples already. Several guard-gated communities that have a high amount of vacant homes, short sales and bank-owned (homes) are starting to pop up slowly.’”
“The hardest-hit sector will be semicustom homes in guard-gated communities, Hawks said. Homes in those areas that were going for $1 million to $1.5 million are now listed for $600,000 to $800,000 and will probably drop to $500,000 or $600,000, he said.”
“Though not as prevalent as they are in the lower markets, ‘mortgage walkers’ are letting banks take back high-end homes, Hawks said. His partner has a Seven Hills foreclosure home in escrow for $750,000 that was once valued at $1.4 million.”
Las Vegas Now from Nevada. “Our community’s foreclosure crisis has many parts, some of which are only coming to light with the passage of time. With banks now owning so many homes, local realtors say they aren’t moving fast enough when it comes to selling property banks admit they don’t want to own in the first place.”
“When Karen Reffner got divorced and lost her job due to an illness, she was convinced she was going to lose the home she had lived in for the past nine years.”
“‘I spent all these years putting my heart into it, and it’s gone. Sorry. I had a lot of good times, but when you spend every day and night working and doing all of this, it is very hard,’ she said.”
“So Reffner moved into a rental home and started working with a realtor to sell her home in what is called a short sale. She was hoping to convince her lender, Bank of America, to accept less than the loan amount in exchange for a quick sale.”
“The problem is Reffner says it was next to impossible to get any kind of answer from the bank, ‘At that point, we did not have any contact person. It goes in a pile. When the things come in, it just goes in a pile. They did not know how to work with it and they’ve even told me this is all new to us.’”
“Bill Uffelman represents the banking industry in Nevada, ‘We’re certainly not in the property management business.’”
“He says banks themselves are in unfamiliar territory and are actively working to adapt to today’s market conditions. ‘They are shifting staff, shifting resources. It becomes a re-training, re-direction. You’ve got staff so can we do something to make it better? And this is literally a developing process,’ he said.”
“Gail Selter, Karen Reffner’s realtor, says she’s seeing signs that some of the bigger lenders are slowly adapting, but the frustrations are ongoing.”
“‘They will say, ‘We’ll call you back in two business days,’ and they don’t. And then we have to get back on the phone with them. So it’s an aggravating part of our business to have to be able to maintain a log and keep on top of them,’ she said.”
“Selter says delays have caused two potential buyers to walk from this short sale and for every day that passes without a sale, Reffner says her credit, and her spirit, is taking a beating.”
“‘It is to the point where I am so tired of dealing with it, I just want to go on with my life,’ she said.”
‘Then in mid-2006 the housing market started to slow. By early 2007, the economy had begun to contract. Municipalities began cutting services, schools started closing, home builders walked away from subdivisions, retailers closed stores, businesses laid off workers, and foreclosures started to soar. It became clear that Arizona would not grow at the expected pace. Attention turned to adjusting the state’s population projections.’
‘Six months ago, projection estimates showed 105,000 people moving to metro Phoenix in 2008. That figure recently was adjusted to 85,000. The drop translates to about $24 million less in tax revenue for the state.’
‘Until accurate projections are complied, all types of financial and development plans across Arizona are in limbo.’
Or deep do-do, is more like it. And guess what Arizona Republic? This one’s on you! You are the most read press organization in the state and you BLEW IT! I would read the AR in 2003, and there would be little articles; 9,000 houses to be built here. 15,000 there. And this was every day!
The AR was the primary kool-aid dispenser during the housing bubble and they get the HB Boob prize for leading us into this disaster. Own up fools!
Hmm, as a legal resident of AZ but being actually There only occasionally, I kind of liked the AZ Republic because it was neither left-lib-loony like LA Times nor socially Neanderthal like some other off-the-coasts papers. Guess I did not notice the RE cheerleading because the LA Times was maybe much worse in that regard…and also, AZ really WAS faster-growing, no? People (like me) DO leave high-tax CA for moderate-tax AZ.
It’s not a bad paper over-all, but the RE and business reporting was nothing short of clueless in the run up. We are in a recession with no easy answers. The thing AZ had going for it was a low cost of living, mainly due to cheap land. That’s gone for the time being. The only way out will spell foreclosure for tens of thousands. It doesn’t matter how many were coming; those were largely equity nomads from California, and they’re broke now.
The LA Times people are a bunch of unoriginal losers. They write now like they predicted the whole thing. Remember the Salton Sea piece? Orange County/LA are losing more jobs than Detroit! Way to inform the public…
Coming from Texas, I don’t see AZ as moderate tax. We’ve got sales, property and state income taxes. They even pop you if you have an expensive car. The infrastructure is junk. Now all the cities and towns are broke. IMO, this state has NO leadership, and that includes the big press.
Ben,
Salton Sea? Any way you can dredge up that link? In a way I’ve always kind of liked that area ( Oregonians like ANY place that doesn’t rain 11 months out of the year! )
When I was in the service stationed in San Diego back in the late 80’s the Nickel Ads used to run ads for 1 acre lots out in Indio and Bombay etc. for like 10-15k. I’ve no idea what they might have gone for at the height of the madness but I imagine when the dust settles they’ll be roughly the same, on an inflation adjusted basis.
“Nestled on the western shore of the Salton Sea, the town doesn’t have a supermarket or movie theater or drugstore. But it has as many as 250 homes for sale, most of them newly built, a huge supply for a place with just 1,440 people.”
“When real estate values began soaring a few years ago, builders flocked here. Land was cheap. Builders figured that people priced out of Los Angeles and San Diego would discover Salton City and the other towns in Imperial County.”
“Now, with home values sliding, mortgage rates edging up and gasoline prices on an upward trend, that assumption appears premature at best. Imperial County, at least for the moment, seems a subdivision too far.”
“‘Builders are like lemmings. They saw a few of their peers going to Imperial County and they all joined in,’ housing consultant Patrick Duffy said. ‘They didn’t do market studies. They just crossed their fingers.’”
“Not far away is the Ranch, a 273-house project by Stockton-based Matthews Homes that is just getting underway. A steady stream of potential buyers has come to check out the models, which cost up to $355,000 for a four-bedroom, 2,600-square-foot home.”
“Sales agent Teresa Castillo said she had sold three. However, two of the deals are ’shaky. The buyers are having credit issues,’ Castillo said.”
“In a tightened lending environment, it’s common for deals to fall through or for buyers to simply change their minds. New-home sales in Imperial County in the first four months of 2007 totaled 259, according to DataQuick, down sharply from 677 in the same period a year ago.”
“Deals are getting done. Credit the rock-bottom prices. Some brand-new homes sell for less than $200,000 and, thanks to the oversupply, are getting even cheaper.”
“ERA Investment Group, the biggest Salton City developer, touts the community as both ‘California’s last frontier’ and ‘the next hot market.’ ERA’s sales brochure…touts ‘breath-taking views’ and claims the sea ‘teems with fish.’”
“Carol Hines, an office temp worker in Brawley, remembers camping on the shores of the sea about 15 years ago. ‘This developer came bounding up and said, ‘Are you interested in buying some land?’ Hines said. ‘I looked around at the dead birds and the dead fish and said, ‘I’m kind of sorry I’m even visiting.’”
Of course, if you like this area, I’ve got some high-end houses in Yuma to sell you.
“I’m kind of sorry I’m even visiting” LOL!
Thanks Ben. The original article is not quite a year old so I can’t imaging it’s gotten any better there? Talk about no supermarket or drugstore? When I first went out there in like 1987 there was a little bait/ice cream shop and a small marina. The locals were real nice if not a little crazy from the heat but it’s remoteness appealed to me.
It was a day trip we did with the daughters as part of an experiment to see just HOW FAR east of SD one would have to go to find affordable property? Once you’ve seen the Salton Sea, there’s no point going any farther.
I suppose the bottom line is that once the fluff and hot air are let out even at 10 grand an acre it wouldn’t have even kept pace with inflation. What’s to become of these modern day… ghost towns?
We went to Salton Sea when I was a kid, circa 1960, and I remember that under the shore water was sharp coral-type formations that hurt my feet. It was nasty for someone used to Santa Monica.
“The locals were real nice if not a little crazy from the heat but it’s remoteness appealed to me.”
You’d love my town. 101 today forecast.
In the 60s Salton Sea was really popular and lots of people spent time there - that was before the sea started dying. SIL teaches at the high school out there - mostly very poor and English challenged.
“builders are like lemmings”
great for a bumper sticker or t-shirt
RE: Salton Sea
http://www.amazon.com/Plagues-Pleasures-Salton-John-Waters/dp/B000S0GYP2
Here in Orlando we call the paper The Slantinel.
How much do you think our dislike has to do with the consolidation of all these news medias? and their reliance on certain advertisers?
Same with Clear Channel…You can’yt turn on the radio without hearing a realestate or debt consolidation ad.
Newspapers are in the process of dying, as their advertising revenue stream goes away~
McClatchy newspapers just made 1400 people redundant…
http://afp.google.com/article/ALeqM5jQmsft9TmMsLSEGVaBqSX7w86dwQ
Here in Tucson, the Arizona Daily Star is referred to as the Red Star.
We are the Loan Red Star state, here in sunny California…
http://wwp.greenwichmeantime.com/time-zone/usa/california/images/california-state-flag.jpg
The Minneapolis Star Tribune is also known as the “Red Star Tribune”…
Can’t we ship these publishers and their columnists (sp communists) to Afghanistan? I hear they are in need of infrastructure support (slanted newspapers!).
And I understand that most if not all of these newspapers have been using Arabic Numerals, consorting with the enemy…
Hate to see McClatchy shrinking … they kept their eyes open.
Aladinsane, are you British? Saying “redundant” rather than “laid off” or “unemployed?”
I’ve spent enough of my life in British English speaking environments, that different words - like spanner, car boot, chemist’s, etc - are interchangeable w/ American terms.
But a laid off human being as “redundant” always sounds poignant to me - I guess because I think of “redundant” as “accidentally repeated terms or phrases, worse than useless, edit them out.”
I’ve spent a lot of time in the British Commonweath & UK~
Many a fortnight…
Based upon my observations on many a road trip the past few years…
Phoenix is no different than Tucson, Las Vegas, San Diego, the Inland Empire, or the Central Valley.
All bonafide financial disasters differing only in magnitude…
People here make fun of Texans, but at least most there know it’s largely barren, rocky crap. Notice you don’t hear many stories of FB Texans with 15 houses around their neck.
Perhaps Texans have a sort of financial deja vu view of bubbles, thanks to the collapse of oil prices in the 80’s?
The housing bust in Houston was a big topic in W. Colo., of interest to the oilpatchers.
I imagine that there are a few people in Austin with a great big mortgage for a great big McMansion and an “investment” in or deposit on an overpriced condo. I could be wrong.
One “neighbor” bought a huge fugly “townhouse” (McMansion duplex) up the street. It was on the market for $575,000 until recently (I find it hard to believe that it sold, but the sign disappeared while I was out of town), because it turns out they bought it as interim housing while the downtown condo tower where they bought was being built.
Husband talked about it like it was a normal situation, wife had fear in her eyes.
–
‘There was a lot of speculative hoarding by homebuilders in the face of rapidly rising prices’
And now the hoarding is being done by speculators like Mr. Klein:
“The Denver Post reports from Colorado. “Andy Klein is a bargain shopper - on a huge scale. Since late last year, Klein has bought a few hundred lots for about half of what they sold for just two years ago. Klein is buying properties from banks and builders from as far north as Longmont and Brighton to as far south as Colorado Springs.”
There will be lot of speculators, with lots changing hands, that will get burned before the real investor would buy them at pennies to the dollar not quarters and dimes.
Jas
I can understand how maybe a person would feel like they were getting a good deal at 50% off peak under relatively normal circumstances, meaning that this is just a temporary dip and growth will soon resume. I can also understand why people might choose to believe that’s the most likely scenario.
BUT, why does it seem like none of them can even imagine the possibility that we’ve built so much oversupply that we won’t really NEED to build any anything for a looooooong time? Or do they imagine it, but figure that they’ll just walk away if they lose money? I have a hard time believing this guy and others like him are paying cash that they can afford to lose…
The morons always think 50% off is a good bargain. That’s what “catching a falling knife” means.
They thought that about Nortel, and they thought that about Lucent, and they thought that about Cisco, and they thought that about Amazon, and undoubtedly in the future, they will think that about Apple and Google too.
The end is always the same.
Echos of the Nar (i.e “They’re not making any more land”) are still bouncing within the skulls of knifecatchers.
The NAR did a fine selling job over the years; it will take some time for residual echos of their dogma to fade.
Meanwhile, join the ranks of those of us who are greatful that the NAR is still able to convince folks to willingly sacrifice their hard-earned money to our cash-starved System. Slimy as they are, the NAR folks are acting as our friends.
50% off seems like a good deal in normal times, but these are not normal times. The descretionary income that was around after paying for the basics is going down. That would leave a lot of people house poor, or very close, even after buying at 50%.
Either housing prices come down more or wages go up. If neither of those happen, this country is looking at a big push into a much smaller middle class.
This lady is nothing short of completely stupid.
“Klein has bought a few hundred lots for about half of what they sold for just two years ago.”
Did the writer confirm the facts before writing this story? Could be true but sounds like a plant to stimulate the market there.
I’m sure they’re running out of land in Brighton (snicker). I could see some locales where a 50% discount might be a decent deal, but not Brighton. Its a Denver exurb, and there is nothing particularly special about it.
–
“‘Properties in this market do not lose value,’ said Judi Kiernan, owner of Telluride Consulting. ‘There’s a limited number we can’t make anymore. We’re not expanding like a Steamboat or Vail. I don’t want to sound like a Pollyanna, but the idea is, Is value falling? No, value is not falling. Expectations are being adjusted.’”
You ARE sounding like a Pollyanna, lady. Let us touch base in a year or two.
Jas
Telluride is not that special. It’s a box canyon, cold in the winter and nice in the summer, but everyone’s crowded in, no parking, claustrophobic. Mountain Village is up where you can see out, but it’s so regulated and expensive that only the wealthy can live there, and it has that feel of elite that makes me uncomfortable. The people don’t seem so real.
Ouray, Colorado, just across the mountain, is just as beautiful, if not more so. But no ski area, so not inundated, quiet, and much more reasonable. I’d opt for Ouray over Telluride any day, it’s an hour away if you want to ski, but great x-cty just up the pass.
The Telluride boosters think it’s way more special than it is. And Judi says they’re not expanding, well, tell that to all the workers that clog the highway between Telluride and all points, going there to work, a lot of it for construction. I’d be interested to know if traffic’s slowed down any. Pollyanna is right.
Interesting though experiment: What would the town of Telluride do if gas goes to $10/gal and beyond?
1. Raise the rates for minimum wage services jobs (probably 2-3x), to get people to continue to commute 1-1/2 hr each way from Montrose
2. Build a low-income housing community in Norwood or Dolores, and run shuttles
3. Build a low-income housing community in Telluride itself? Obviously would have to be government owned and managed, since the free market simply will not respond in this manner
4. Some other low-income wage earner subsidy mechanism that I haven’t thought of?
Yeah, there’s the biggest question you have to ask: can you get to T-Ride in any other way besides automobile road or airplane?
If not, is there enough land in the canyon to grow enough food to sustain the town?
Also, is there enough local potential heating fuel? I hear it gets cold and snows there a lot. How much you think a house will be worth if heating oil is $15/gal? or even $20/gal?
Ain’t nobody gonna wanna live there if you have to be a multi-millionaire just to get in and out and not freeze to death in the winter.
2nd interesting though experiment: What would the town of Torrey, UTdo if gas goes to $10/gal and beyond?
Answer: No one cares.
LOL!!! At least you guys wouldn’t crash as hard, you’re probably a lot more self-sufficient. Do the people in Caineville deliver organic veggies to Torrey?
Every Saturday in season, 4PM (thereabouts) outside the Robbers Roost bookstore. It’s like a swarm of flies as the time draws nigh, people descend in droves as stuff sells out quickly.
Randy is struggling this year as well. He’s lost a lot to late unexpected frosts. And like everything over this way, plant development on average is lagging the norms by 4-5 weeks due to the extreme cold.
Lost in Utah,
You have my vote for Ouray. It is a much quieter town and there are a few good places to eat…even during the off season.
“Properties in this market do not lose value,’ said Judi Kiernan, owner of Telluride Consulting. ‘There’s a limited number we can’t make anymore.”
Wait, is someone actually saying this in 2008?
–
Only the Pollyannas.
Jas
The Daily Planet from Colorado. “Wrap your head around this one.
…the average price of real estate has never been higher.”
…home prices aren’t really budging.”
…‘Properties in this market do not lose value’
…‘There’s a limited number we can’t make anymore.
…Is value falling? No, value is not falling.”
Ok, the Daily Planet has just surpassed the A.R. and L.A. Times for being the most in-denial and shameless shill for the REIC. Question is, how long can this bias persist once they meet their Kryptonite (foreclosures, recession & bank failures)?
They’ve been bought by the RE people for years, lots of ad space, that’s about all there is to the paper, actually, although they once had a great video by a couple of teenagers who skied off limits and got caught in an avalanche while wearing helmet cams (both survived).
You left out:
‘No, value is not falling. Expectations are being adjusted.’
“Wrap your head around this one. Right now in Telluride, real-estate sales volume is at its lowest point since 2003, and the number of properties changing hands has dipped to levels not seen since 1988. And yet, the average price of real estate has never been higher.”
Perhaps I’m just simple minded, but what is there to wrap around?
There was a run up in prices to the point where sales skidded to a halt.
Until someone buys something and produces a current comp, it’s unknown if current valuations are too high, too low, or just right.
Why do people feel so entitled to short sales?
I would be VERY reluctant to engage in a short sale if I were a bank. Here’s why: It’s easy to con the bank out of a lot of money in a short sale.
For example, say you have a short sale listed at $450k, for a total loan of $500k. I could come up to you and say, hey you aren’t getting any money out of the deal anyway, so what do you say you accept a $350k offer, I kick you back $20k off the books (like a donation to your kids’ college fund) to get the bank to accept the shortsale, and we’re all better off (except the bank).
At least foreclosures keep everything out in the open and tend to prevent certain kinds of fraud.
that’s not clear to me..
the loan amount is 500K. The homeowner/seller is asking 450K. You offer 350K with a 20K kickback.
questions..
If the bank accepts 350K, doesn’t that mean it’s happy enough to accept that price? How are they getting screwed? By not holding out for more money?
Since the seller is on the hook for income taxes on debt relief, selling at 450K means being taxed on 50K.. that’s maybe 10K?. Selling at 350K means being taxed on 150K debt relief.. maybe 45K in taxes? Why would the seller settle for 20K under the table if the result is they have to pay far more than that in taxes?
Well for one, the taxation on debt relief has been suspended for the time being.
The bank would have been much happier accepting the $370k than the $350k, which in that case was the “true” market price. I don’t think they like being left out of some of the transaction.
The point is when the short sale is a private party deal not out in the open like a foreclosure, then the bank risks not being privy to part of the deal.
The bank would have been much happier accepting the $370k than the $350k..
sure.. and they’d be even happier with 400K or even more happy with more..
But they have no idea about the 20K. You know about the 20K and me thinks you may be projecting a little bit. The bank is oblivious.
Sure, they don’t want to create situations where it’s easy for people to rip them off, but a short sale is examined fairly carefully, afaik.
i didn’t know debt relief is suspended.. when did that happen and what areas / situations are affected?
“i didn’t know debt relief is suspended..”
Wow where have you been? LOL. Taxes on debt relief for homeowners (normally considered an income source 1099′ed by the debt shaftee) were suspended late last year, I think until 2009. It’s not the debt relief that’s suspended, it’s the tax liability for it.
Excuse me but, Screw the banks.
What have they done wisely or ethically for quite some time?
Just sayin..
Problem I find with the short sales in Florida is that as a buyer you are better off waiting for the foreclosure..example..seller has note of $950K..trying to do a short sale of $750K..when when that house finally got foreclosed on and got a buyer the closed sale price was $575K…that is a huge difference…
Banks sometimes have a choice between losing some money now, and a lot of money later. When that happens, you do the least bad thing (also known as the best thing.)
Theoretically, they should be unemotional about the loss, and take the short sale if the estimated cost of foreclosure + maintenance + taxes + auctioning off the property is greater than the short sale. Otherwise, they should move towards foreclosure.
Those four things cost real money (not to mention the salaries involved.)
Your position makes absolutely no sense as a business proposition.
Faster Pussycat,
Correct. Additionally at some point the time value of money comes into the equation and the bank realizes it’s better for them to salvage what they can and get those dollars re-deployed in a loan that IS performing!
It makes plenty of sense.
At any given time the bank would like to get the market value for the defaulted home, be it a short sale or foreclosure. Problem is, when you have the possibility for off-the-books dealings like in a short sale, the tendency will be to get less than market value because of the back-alley component of the transaction. If they get in the habit of accepting short sales no questions asked, then I GUARANTEE you the banks are going to be defrauded left and right.
Banks should be (and in fact ARE) reluctant to accept short sale dealings, for many reasons this one included.
That’s your theory anyway.
The bank can do whatever the heck it wants. The bank has many motives not all obvious even.
If I were a bank I’d take a guaranteed FB over a theoretical one especially if I could pawn off that note to some other unsuspecting buyer. So there are many roads to Rome, and neither method is superior over the other.
Man you guys are having trouble “getting it”. The fact that the seller, who nominally has no interest in the value of the sale, can lower the price to say, $350k, reject potential offers at say $400k, in lieu of a transaction that occurs at $370k actual but only present the $350k nominal offer to the bank means there is a underlying cost to accepting a short sale. In this case the cost is $50k, the seller makes off with $20k, and the buyer gets $30k off what the true market value would have been. The bank will consider offers it receives as indications of market value. But they are being lied to and it costs them money.
Try it with bigger numbers than my example and it becomes clearer.
No, you don’t get it.
You keep favoring what can be observed (in your example, the $30K) against all the unobservable intangibles that you can’t measure so easily (legal fees for foreclosure, taxes, cost of maintenance, auction fees, and the unknown ultimate auction value assuming it sells at all, and salaries involved while you’re waiting.)
You have to account for all the unobservable costs that are just as real as the $30K which you can observe up front.
The banks are not morons. Taking the hit upfront can be cheaper in the longer run.
Firstly “the seller” is out of the picture completely. The bank and the bank alone determines what, if any offers they will entertain. There IS often fraud committed during a short sale but the original buyer is usually the victim.
Equity Skimming and other slight of hand contracts designed to “save” the borrower that almost always end in tears, and ultimately foreclosure anyway. Recently we’ve all seen a LOT of ads for “Short Sale Millions” yet I have never personally met anyone that made out all that well on SS’s let alone make a living at it.
Faster Pussycat,
Well that and the fact that the whole scheme seems very reliant on the mythical Craigslist “Instant Equity”!
So you knocked off an add’l 30 or 50k off the already hyper-inflated price? So what, it’s still way too early to be entertaining short sales. Today’s short sale bargain will become tomorrow’s unsellable McMansion.
DinOr,
I agree with you. However, that’s the bank’s problem.
Let them judge whether or not foreclosure is better or a short sale. It will be different in virtually every single case depending on when they purchased, etc.
My point was a general principle. Neither method is superior.
You seem to be arguing that it’s too early in the game to be entertaining short sales. Sounds reasonable.
Haha I can’t believe it! I searched on Boston Craigslist for ‘Instant Equity’ and found 11 entries in the last seven days.
If the equity was so damn ‘instant’ why wouldn’t the real estate agent buy it? why wouldn’t the property owner stay in the home? Equity is merely the promise that some future buyer is going to give you more for your house. Good luck with that. I’d rather work with REAL, TANGIBLE money like cash.
Ed G,
I did the same on Austin Craigslist and found 15. Ha! Everything’s bigger in TX.
“Banks should be…….”
What they should do, and what they end up doing, will be two different things.
The banks should be hiring staff experienced enough to work thru foreclosures, short sales, and gathering evidence to deal with the fraudsters in court, to get this mess off the books ASAP.
But that doesn’t fit with the new US business paradigm, which is:
-Ignore the problem until it is too big to ignore.
-Then ignore it some more, until the government comes up with a bailout plan to reduce the size of the problem.
-Hire inexperienced help at the bottom of the wage scale.
-Hire half the help you actually need, then run them into the ground with workload/overtime, until you burn them out doing OJT on the task at hand.
-Lather, rinse, repeat.
-Go after the “low hanging fruit”…..ignore/write-off the more sophisticated fraud cases, because “it’s cheaper to just write it off”.
(I can’t wait until some prosecuter tells the public they are taking a plea bargain from a serial killer, because “it would cost too much to convict him of murder)
-Have as much fraud on the trip down as the trip up, with the same cast of characters.
In a way, this makes perfect business sense……but at some point in time, you would think that the PTB would get tired of being played as suckers.
As a member of the “great unwashed”, I know I’m getting tired of it. It’s time to start doing the “right” thing, rather than what is expedient.
“But that doesn’t fit with the new US business paradigm, which is:
- Ignore the problem until it is too big to ignore.”
Or, ignore the problem until the issue of who’s gonna be elected is settled.
The slogan of the bankers should be: “It’s an election year, stupid”.
i don’t think the banks are ignoring anything.. They are paralyzed by lack of knowledge and skill.
They have never had an iota of property management sense.. never want to own property and don’t have the staff or expertise to deal with this avalanch of houses. They employ nothing but paper pushers and number crunchers..
i’ve suggested that the banks who survive this with the least damage will be those that get on the ball and hire property management companies to deal with the properties.. maybe just rent the foreclosures out.. at least mow the freakin lawns and protect them from vandals.
But the PTB aren’t being played as suckers. Look at campaign donations, and all the off-books “donations-in-kind”. Everybody’s on the take.
We literally need to flush the entire Federal Govt. apparatus down the crapper, and start over. I suppose we would likely break up as a nation before that happens, though. At some point, some group of states will decide they’ve had enough, and we’ll split, mostly along the political fault lines of the day.
BackToTheBank,
So why doesn’t the new buyer just say screw you to the FB seller when he knows that the bank will take 350K. Why pony up the extra cash to the seller in this scenario.
well yes thats what will happen
Me thinks BackTotheBank may be a FB’er and thought he had a great new way to scam the system. Marcus clearly shone the light on this DUH moment and revealed the why we are in this current situation. Some folks will stick to flawed and DUH moment beliefs even when it is obviously whacked.
I bet BackTotheBank is still pounding his head wondering why we al don’t “get it” - he’ll prove us wrong dontch’a know!
It’s not about feeling “entitled to short sales”.
It’s about the fact that the FB owes WAY more to the lender than the property is worth.
So a short sale is the only way to purchase at a price that is a market price.
Buyers would much rather AVOID short sales, since it is extra hassle, delay, uncertainty, difficulty in negotiation, etc.
The only reason to do it is that the silly FB owes so much on the house that they have no skin in the game, and no voice in the sales negotiation.
–
Latest Price Change, Annual Rate, For the Transactions Originating in the First 15 days of April (as per Radar Logic, PPSF):
Las Vegas, NV -53.7%
Phoenix, AZ -49.3%
San Jose, CA -42.9%
Washington, DC -40.4%
Sacramento, CA -36.5%
San Diego, CA -30.3%
The usual suspects. The prices in these areas hit a new low almost everyday of transaction (over a 28-day period sliding window). This is during a very strong seasonal period.
Jas
Isn’t the summer, pre-school season the “main time” people buy places? Don’t deals supposedly die off towards Sep-Oct?
Am I mistaken?
–
These are the transactions that closed late May early June. Seasonally, the prices increase faster for transactions that close during Mar-May and then they stay strong until Aug-Sep. In recent years, the price peaks for various areas occurred during May-June 2006 and May-June 2007.
Jas
In my area, we are now approaching the dreaded Summer Doldrums of home sales.
The peeps that are looking for a house in the best school district have already gone to contract. They want to be in the new abode by the last wk. of August. Allowing for a traditional 60 day period from contract to close, the bulk of contracts are written April-June. There will be some stragglers in July if they can do a 30 day close.
Then, much to realtor dismay, out come the Bargain Hunters. And the slide continues…
I thought this was selling season?
I wonder how the knife catchers will be feeling when October rolls in?
1997 prices here we come………
Oh the Yumanity!
“The American Dream has become a nightmare for many Americans - Yumans among them - who got caught up in the real estate boom of a few years ago. ‘There’s more lower-end homes selling now,’ said Joe Wehrle, Yuma County Assessor. ‘We have a different picture. In the past, we had several upper-range homes sold. The top end just is not selling well.’”
Hey! I resent that. I just want to be treated like a Yuman being!
Again the wreckage from the Rolling Bubble. The 3:10 to Yuma derailed. I don’t have ANYTHING against most of the places that are confronting the fall out from the bubble, that said, I can’t imagine anyone associating Yuma with any kind of a “premium” let alone luxury?
Yuma is great! Well not totally great, but someone has to defend it. I have lived all over Arizona and Yuma is my favorite - over Flag, over Tucson, etc. Except for that little heat problem (ok, 115 today is not that little, and I know its not really a dry heat - but the beach in San Diego is only a 2-1/2 hour drive…)
What Yuma does have is a sound economy - ag, military, industry, winter visitor tourism. Growth was never a big business like in the Phoenix area, except in 2005 and 2006. Right now we still need to we purge the excesses from that binge and get housing back to an affordable level.
Yuma is more of a family town - much better than any big city. And being on the Colorado River is not bad. In the time most people commute home in Phoenix or LA, one here can be out on the river or one of the lakes.
‘The 3:10 to Yuma derailed.’
A good story. I believe Emore Leonard wrote it.
A stupid movie, though.
Say, of speaking of stupid movies, I saw 10,000 B.C., as I am fond of cavemen and dinosaurs and other campy nonsense, but this particular movie elevates ’stupidness’ to a kind of wondrous cosmic force, almost glorious in its moronic majesty. My eyes tried to climb out of my head so they could hide in my purse and whimper among Tic-Tacs, pennies, and lint, but there was no room for them in there, as my moist spleen had already escaped to it.
The only good part was the housing situation of the brave little primitive cave-persons. Not only was it a good location, with spectacular views, they had wisely built them with mammoth skeletons, and decorated prettily with dead animal portions. INCLUDING… granite countertops.
Now coming up to bat for the Pavlov Dogs, the catcher: Las Vegas…
“‘We’re in the first inning of the million-dollar market plunge,’ he said. ‘We see some examples already. Several guard-gated communities that have a high amount of vacant homes, short sales and bank-owned (homes) are starting to pop up slowly.’”
“‘We’re in the first inning of the million-dollar market plunge,’ he said. ‘We see some examples already. Several guard-gated communities that have a high amount of vacant homes, short sales and bank-owned (homes) are starting to pop up slowly.’”
Here is the issue..SO MANY of these million dollar babies were bought with NEGATIVE AM LOANS..many were 5 year ARMS..However, if you have not paid the total interest payment due and instead opted to do the min payment that adds to the balance of your mortgage each month..that changes the 5 year arm to a 3 year arm..which means more and more of these types of loans are increasing the payment amount to as much as 77% more and are excelerating to the full principal and interest payment…(that $3K payment a month is now a 10K payment a month)
Now add in the fact that the availability of these loans to 99% of these people are gone( many went stated income to get the foot in the door.)..and the next huge wave is coming right on in to the high end market…
i recently read something amazing about Pavlovian conditioning and have had the urge to share it ..
i forget the details but this is the gist of the story:
Someone, maybe Pavlov, had several cats, dogs, etc in the lab and everything’s going along as planned when there’s a flood. I forget if it was rain or a levy breaking, but the water is rising fast.
The people get out in time, but the animals, cages stacked atop one another are trapped. Those lower down drown. Some of the higher up survive..
Here’s the kicker.. Those that survived lost the reflex actions that had been trained into them, probably due to the extremely stressful situation.
Here’s an old brick school near Delta, Colorado that was remodeled and sold a few years back for something in the 500k range (way overpriced for the area). An out of state couple bought it and did yet more remodeling, putting a ton into it. I went to an open house out of curiosity about 14 months ago. They told me they were in way over their heads on it and needed to sell it asap. Still hasn’t sold, yet no price reduction. It’s a cool place, but too big and vast and expensive to heat for my tastes. This particular RE person is notorious for putting high prices on everything she lists, she likes to go fishin’. It will either drop in price soon or go into foreclosure, is my bet.
http://tinyurl.com/4yv2t9
And this used house saleswoman should’ve written romance novels, her descriptions are just so…apt!
“The Romans didn’t even have it this fabulous!” (about the soaker tub in the bathroom)
“Be sure to notice the details, they are everywhere!”
BWAHAHAHA
House porn.
If you have more than 1 wife in Utah, they are called “plural wives”, does the same hold true for houses?
“Plural Homes”
For in-staters, sounds about right. To keep the analogy going, if they’re owned by rich Californians, I think that “trophy homes” is more apt.
OK, but if you have more than one wife and you’re NOT in Utah, what’s it called?
illegal…crazy…your turn
An out-of-state vacation!
Ha - very funny, Shoe, what I meant was if you AND your wives aren’t in Utah, not just you - LOL!!
OK, I need some coffee…say, can you setup a solar espresso machine for me for when I’m in the outback?
Espresso in the outback? You’re obviously a tougher gal than that. Whatever happened to river coffee?
Brings to mind a funny story. Remember the original City Slickers movie, where Billy Crystal started the cattle stampede when he used his battery-powered coffee grinder? I should be ashamed to admit this, but after seeing the movie I wanted one of them so badly, for camping trips. I looked far and wide, and as far as I could tell, such a thing just doesn’t exist in the real world. Anyway, someone here will probably prove me wrong and show me where to buy one.
Rustek Traveler Coffee Grinder
Amazon dot com
I forgot to mention that the batteries never wear out - they’re in your hand.
“The Romans also had orgies.”
Wonder if she can provide for that too.
Incidentally, is house porn “on the house”? Can we all get some of that, please? Pretty please with pink below.
Ya just gotta love it. They build these mansions (or in this case remodel) that 99+% of the local population can’t afford.
Not long ago, Chinese officials sat across conference tables from American officials and got an earful. The Americans scolded the Chinese on mismanaging their economy, from state subsidies to foreign investment regulations to the valuation of their currency. Your economic system, the Americans strongly implied, should look a lot more like ours.
But in recent weeks, the fingers have been wagging in the other direction. Senior Chinese officials are publicly and loudly rebuking the Americans on their handling of the economy and defending their own more assertive style of regulation.
Chinese officials seem to be galled by the apparent hypocrisy of Americans telling them what to do while the American economy is at best stagnant. China, on the other hand, has maintained its feverish growth.
Some officials are promoting a Chinese style of economic management that they suggest serves developing countries better than the American model, in much the same way they argue that they are in no hurry to copy American-style multiparty democracy.
In the last six weeks alone, a senior banking regulator blamed Washington’s “warped conception” of market regulation for the subprime mortgage crisis that is rattling the world economy; the Chinese envoy to the World Trade Organization called on the United States to halt the dollar’s unchecked depreciation before the slide further worsens soaring oil and food prices; and Chinese agencies denounced a federal committee charged with vetting foreign investments in the United States, saying the Americans were showing “hostility” and a “discriminatory attitude,” not least toward the Chinese.
The Chinese attitude is no doubt bolstered by the lame-duck status of the Bush administration and by the fact that the United States is widely seen as having squandered its political and military leadership during the war in Iraq, which China opposed. Likewise, Chinese officials and state news media have suggested that the relatively quick mobilization of the Chinese Army during the recent earthquake in Sichuan Province contrasts favorably with the Bush administration’s reaction to Hurricane Katrina.
“U.S. credibility and the credibility of U.S. financial markets is zero everywhere in the world,” said Joseph E. Stiglitz, a professor of economics at Columbia University who has sharply criticized the Bush administration and praised China’s economic management in the past. “Anybody looking at this from the outside says, ‘There’s been a lot of hot air coming out of the U.S., so why should we listen to these guys when they didn’t know how to manage risk?’ ”
The damage that these gangsters have done to this country is incredible. I just wish more people understood it like the Chinese obviously do.
Here’s a possible Chinese viewpoint:
Allow yourself to be convinced by short-term goal orientated American businessmen to shut down their factories and move everything over to your low-cost country. Then arrange it for these Americans to buy all the junk you can produce to distribute among their countrymen and loan them the dollars to do so from the mass of dollars they send you to pay for this junk.
When America finally becomes economically exhausted and flat broke move in with these dollars and buy up assets at a great discount. Don’t bother with buying consumer related assets (remember, America is broke), go for the raw materials and related infrastructure. Then begin shipping the raw materials that you now own, via the related infrastructure (railroads and such) that you also now own back to China.
People are smart.
This was almost the same scenario envisioned for “Japan, Inc.” in the mid to late 1980’s, and we see how that turned out, Japan went off the rails in a major way.
China is an emerging economy, huge land mass and resource base, much different from Japan. I wonder why the whole scenario didn’t work the way many thought for Japan, though, and why it might this time.
One thing that happened then, was that American manufacturing got off of its collective a$$e$ and started competing on quality. Now, much of our manufacturing base is gone and no one seems to care about quality anymore, at least not at the consumer level. This time around, we’ll certainly respond in some fashion, as life surely goes on unless you believe that The End is Truly Nigh. But I don’t know what our response will be, or how much of a difference it will make.
Amen to that. I’ve had a few conversations with friends lately (some of whom I told to sell their houses 2 years ago and they didn’t) about the true state of the USA, it’s credibility around the world, etc, and only a few get the real picture. Personally, I think the USA is in for a very tough period and there will have to be many, many painful adjustments.
I trade the markets on a daily basis but I have to admit that Wall Street is nothing more than a Ponzi Scheme operated by the big brokers, more or less protected by the SEC and various politicians.
I kind of find it interesting because (being a Brit who is married to an American for 30 + years and have American born children and grandchildren) I’m sure that the Brits thought the “empire” WOULD last for a lot longer than it did. Same with the Spanish, French, Germans, Portugese, etc. They all had their turn and eventually came to the end of their run. I suspect this is the end of America’s run and the down slope has started with China and India starting on the up slope. Of course, those old “empires” took longer to decline but these days things move much, much quicker.
The USA probably has one chance to hold on for a while. Finding a new source of energy. God didn’t make America great - Anglo Saxon ingenuity and organization (some of that ingenuity being questionable in the morality area) and oil made America great.
Hopefully, it will not get as bad as I think it will because I have grandchildren but there is no question that, in the last 15-20 years, the USA has shot itself in the foot and, in the last 8 years, shot itself in the other foot. I’ll never forget that headline in a Brit newspaper (which pissed of a lot of American’s) which stated, when Bush was elected, “How Can 50 million People Be So Wrong!”
There is also a character called Bob Brinker (a financial radio guru) who was forever praising Bush and pouring praise on Mr. Magoo (Alan Greenspan) with his, “The Maestro is brilliant,” b.s. I kep telling my wife until she was bored hearing it, “Jeez. Greenspan, Cheney and Bush. This is not good. This is a financial horror story unfolding and we are all going to end up paying the price.” Sad.
a brit.. how quaint.
hey.. when are you guys gonna get rid of that king and queen and join the human race?
Not to mention the “consort” who has made more international diplomacy gaffes than any other. Among such “features” are doubting the number killed in Jallianwallah Baug while the queen was trying to calm the waters during the 50th anniversary of Indian independence, and referring to the Chinese as “slitty-eyed Orientals”.
And how about that written constitution? How’s that working out now that habeas corpus seems to be being suspended out there?
Joey. As far as I’m concerned, they can get rid of them tomorrow. However, they have no authority or power and they put on a good show (Changing of the Guard and Trooping the Colours) for the tourists.
Interestingly, even though they have no power, they do serve another purpose. They are another “stop-gap” and sometimes speak up should anyone (like a Hitler) start to become too popular or if some idiot (as happened there recently) says something like, “We should include Muslim Sharia Law in the U.K.”
Frankly, for the past 60 years, the UK has really become the 51st State of the USA because everything is so linked. Finances, culture, etc. There is a nut-case in California (he has a french name) who constantly tries to get elected to office who has followers standing outside supermarkets, etc, trying to get donations. His big theme is how the British Empire is running the world and will destroy America. I pee myself laughing when I see the display his idiot followers have and the b.s they come out with. One thing always pisses them off (when I see them) is when I say (after looking at their display which shows the Queen and Prince Phillip, etc.) “What British Empire? There isn’t a British Empire.”
However, they have no authority or power and they put on a good show
they own a whole lotta real estate
FWIW
And now they pay taxes too, natch. We should “respect” them for that.
All while the princess who was busy parting her legs so that she could shag an entire series of wogs. Oh well, that’s how the Empire goes.
Yes, they do BUT the rents they charge tenants who live in, what is known as Crown Property, are pretty good. The organization which really owned property (but I think they sold off a lot in the 1970’s) is/was The Church of England. Again, royalty might have a lot of income but their expenses running the different castles, etc, are pretty high and they (Royalty) are very controlled by the British government.
A lot of the stuff you see is simply tradition. Like the Prime Minister having to see the Queen and advising her on some new law which she has to sign off on but, in truth, she HAS to sign off. She doesn’t have any choice. She basically does as she is told but it’s all very civilized and polite.
It’s really all tourist and PR stuff. They say she (Queenie) adds plenty of bucks to the government coffers via trips to other countries to foster trade and tourists coming to the UK. Not sure about what she brings in and what she costs.
I was once VERY against Royalty for the simple reason they (in my mind) create a class separation society but, over the last 30 to 40 years, the class thing has pretty much broken down. I now hear UK doctors, lawyers, etc, with cockney accents on tv. 40 years ago those accents would all have been Eton, Harrow, etc. Until Michael Caine, even the actors were upper class putting on (usually very bad in Noel Coward type plays) cockney accents. Cockney accents (like mine) only came out of the mouths of the lower working class. Forget being a doctor or a lawyer in those days if you were working class. Harrow and Eton and a few other colleges, were the traditional educational centers for the children of the rich and powerful where they were introduced into the “Old Boy Network”. Everything changes.
I like Brits.
The cab drivers aren’t as abusive as the ones I encountered in la belle France.
“……How can 50 million Americans be so wrong?…..”
Because:
-The Democratic Party seems incapable of nominating a candidate that is capable of WINNING in the general election. The only reason they have a chance of winning this year, is because of the screw-ups the current crowd in Congress and the White House have made.
Everyone I know who has been overseas in the past ten years has come back with stories about all the Euros who felt obligated to tell them (at length) what an idiot they were, if they voted for Bush (one woman I know was visiting friends in the UK in 2000, and got so tired of hearing it day-in and day-out, she cut her vacation short three days).
This pisses off Americans in a number of ways:
-Last time I checked, you crazy-ass foreigners (and I say that with the utmost respect) DON”T GET A VOTE!!!!
-Our collective experience over 200 years has been that if all the foreigners like it, it is almost automatically BAD for the regular-guy US worker/taxpayer.
So congratulations………all the motor-mouths outside the US that felt the need to stick their noses in our business had a hand in it too.
Just my Neanderthal opinion, of course……..
“…all the motor-mouths outside the US that felt the need to stick their noses in our business ”
We do have a habit of invading places and generally interfering ourselves so you can see why foreign folks try to keep an eye on us.
“U.S. credibility and the credibility of U.S. financial markets is zero everywhere in the world,” said Joseph E. Stiglitz, a professor of economics at Columbia University who has sharply criticized the Bush administration and praised China’s economic management in the past”
————————————
Wow, a professor at a liberal NYC university prefers the “economic management style” of the communist Chinese government over US style capitalism? How utterly surprising! Why, I’d almost be willing to bet that this guy supports Barack Obama too!
In other surprising news, Larry the Cable Guy admits he prefers barbecue ribs and beer over tofu and bean sprout salads…
Yes. China’s management style is so laudable…seems the Chinese have purchased way too many US Treasuries, which in many ways makes them OUR bitches and exposed to trends in our economy.
“When Karen Reffner got divorced and lost her job due to an illness, she was convinced she was going to lose the home she had lived in for the past nine years.”
“So Reffner moved into a rental home and started working with a realtor to sell her home in what is called a short sale. She was hoping to convince her lender, Bank of America, to accept less than the loan amount in exchange for a quick sale.”
What’s wrong with this picture??
Owned home for 9 years. Bought in 1999? Made mortgage payments to reduce debt for 9 years?
Should have PLENTY of equity.
Instead it’s a short-sale.
She must have not “bought” anything. Just rented and cash-out refi-’d.
diogenes,
With “reporters” these days the usual follow up questions just aren’t asked. It’s possible she was cleaned out in her divorce. Not likely… but, possible.
I do fear though there are plenty of “pre-bubble” entrants to this category. Usually HELOC Heaven but there are other scenarios. Sometimes they took cash out and bought other homes as investments and the media didn’t ask that either?
“divorced and lost her job due to an illness”
Spin this new mantra to Congress lady, it don’t work here. And I suppose it too was your ‘dream house’.
My dad is now thinking of buying a retirement home in the Mesa/Gilbert/Chandler area. Basically he’s looking for a 1200 - 1400 sq ft home with double garage in a gated community where he can spend a few months in the winter. I have no real idea about the livability of the area, I’ve been there only once, about three years ago (loved the hiking, by the way). I’m trying to convince my dad to delay any purchase for at least a year or two, so as to save some money and not be so much of a knifecatcher. He won’t be retiring for probably another five years anyhow, so I think he has plenty of time.
What say you? Do prices still have a ways to go down in Phoenix metro?
Hi Diogenes,
I live in north central Mesa. Bought a house here in 2000.
Mesa is the 3rd largest city in AZ.
If you take a drive around here, in Mesa, Chandler, Gilbert,like I did yesterday, you will notice TONS of for lease, for sale signs.
This market is not even CLOSE to bottoming yet.
My BIL owns 15 properties in Mesa - triplexes, duplexes, and SFH, which he rents. He is a professional landlord and has been doing this since 1987. The last place he bought was two weeks ago. Mesa. FB owed $195K on his 1986 4/2, bought in May 06 for $209K.
BIL bought it from the bank for $95K same day he made the offer.
He’s OK with it but said to me Sunday that maybe he should have offered $85K.
Why would he buy a place to spend a few months each winter? Have him do the math - he could spend a few months each year in a nice resort condo or whatever, someplace new each time, explore the world, for the rest of his life and still come out way ahead of buying. Just IMHO.
My dad is getting to be the age where he only wants to spend time at a few preferred warm-weather locations (mainly Palm Springs and Phoenix). And we have friends who spend every winter in Mesa.
Regardless, you may be right about the math.
This is the very crossroad I find myself at? For me a lot of the “value” lies in *not having to deal with some ditzy FB/Accidental Landlord. We all see lots of really neat homes for rent on a month-to-month basis in PS, Vegas etc. but I can almost guarantee you it will be a hassle.
Just look at their terms and conditions. Endless. Deposits you won’t be seeing back. You’ll be explaining to them that if your stay is a pleasant one you’ll consider the same arrangement year after year. But he isn’t listening to you. He doesn’t hear you. All you are is someone willing to keep his specuvestment afloat for another month, or two or six. He can’t see past his next negative cash flow black hole payment.
I just can’t see it working. I’d almost prefer an Ebay 1 penny timeshare for the cost of the annual maint. fees.
How about a resort rental instead of a house? You can get a house, but it’s set up w/ everything and managed by professional managers for exactly the purpose of short term stays (including several months).
As in this:
http://moabutahlodging dot com
a number will allow pets
Short sales- I had an assignment for a home and appraised it at $109,000. I think may have written about it in the past. A week went by and the lender sent a scathing review that I had “chosen” the lowest sales.
In my report I listed the fact that the same house, or virtually the same ranged in asking price between $69,900 and $279,900. There were and are 148 same houses on the market within 1/2 mile of the subject. Imagine that number within 1/2 mile. 90% of sales this past year were short sales ot REO sales. The lender insists that I not use short sales or REO sales. Hell folks that is the market.
The lender sent over 5 sales I should consider. Not one of them went through normal channels and all reflected a value ay least 50% higher than the market reflects.
I cordially explained that we will not use non MLS sales as we cannot confirm with a third party. Then they sent back 3 more sales and said I was being difficult to deal with on this. All gaskets blew at this point and I called the lender.
I explained that they were a FNMA lender and that as I am certified through the state I am bound to report undue influence and coersion by any means from a lender of a representative of that lender. I asked, ” please explain what you mean by the term “difficult” so I can determine my next course of action. Long pause!!!!!!
“Please just forward your completed report. Thanks”
No doubt I am toast with this lender but I am fine with that if they are such slugs. Imagine after all we have seen, these pukes are still pressing for numbers. I am just amazed and I suppose I can get out the fishing gear for awhile.
Good for you, integrity is not a variable in the equation. Now the worm turns on the lenders (whatever that means).
Yes! Good for you! : )
Hey, Diogenes, I finally found an honest man.
too late…
Dimedropped,
I LOVE reading your stories. Keep ‘em coming. And report that lender!
“Jay Butler, director of realty studies at Arizona State University Polytechnic, says part of the current formula for projecting Arizona’s population assumes 1 to 2 percent of the state’s homes are vacant.”
“‘Now we know at least 10 percent of the new homes built during the boom were vacant, and foreclosures are leaving more homes empty,’ Butler said. ‘No one really knows how many homes are empty.’”
Gee Mr. Butler we aren’t talking rocket science here. Mr. Butler head for the Post Office and get their current figures for vacant deliveries and forwardings.
Jay Butler’s a world-class shill for the REIC.
Yeah, this stuff bothers me too. It isn’t hard to look around like I did when I got to AZ and see all the empty houses. I believe AZ and Nevada count drivers licenses, which is like counting people going into a theater and ignoring that there is a back exit. Oh well, not much at stake, JUST THE ENTIRE STATES FUTURE!
I’ve often wondered if those extreme growth projections for areas like LV (7.5K per month!) weren’t BS somehow. I looked into the Vegas one and found it was calculated based on drivers licenses surrendered. Wouldn’t it be likely that spec-u-vestors would surrender their out-of-state license in order to get a tax-free NV address, even if they wouldn’t necessarily live in NV?
Anyone know anything about those numbers? at 7,500 people moving in a month, Vegas must be getting crowded…
In fact, you may even see more NV driver’s licenses (and CA license surrendered) *because* of the burst bubble!
If they raise the marginal rate to 39.9% and uncap Social Security, then Californians can get an instant 9.5% rebate by “moving” to Nevada!
Rend a cheap-ass $500/month apartment that you never go to, register your car in NV and get a NV drivers license (then drive it back to CA!), register to vote, etc.
For the $6000/year your apartment costs (so you can prove to CA that you live in NV), a person making $250K/year would save $22,000 - $6000 = $16,000
That’s why CA needs to be careful about socking it to the rich. (Remember the 1% “Meathead” tax that Rob Reiner proposed?). The Rich are the ones who will be most able to make a few phone calls and “move.”
Wall of Voodoo Economics…
Call of the West?
http://www.youtube.com/watch?v=Kvnin-u75qY
western savages - heh heh
That song always cracked me up.
“(the conflict:) harshly awakened by the sound of six rounds of light caliber rifle fire followed minutes later by the booming of nine rounds from a heavier rifle, but you can’t close off the wilderness. he heard the snick of a rifle bolt and found himself staring down the muzzle of a weapon held by a drunken liquor store owner.”
Welcome to Phoenix
I’d say welcome also to Utah, but their aren’t any liquor store owners here.
I was reading a Time/Life book “High Sierra” (1972) about 10 years ago, where I noticed that Stan Ridgway had borrowed this line verbatim, from it.
“(the conflict:) harshly awakened by the sound of six rounds of light caliber rifle fire followed minutes later by the booming of nine rounds from a heavier rifle, but you can’t close off the wilderness. he heard the snick of a rifle bolt and found himself staring down the muzzle of a weapon held by a drunken liquor store owner.”
Telluride! love the area, hate the attitude.
So many people who have perfect lives.
Yeccchh! The real Colorado doesn’t live there.