Scraping Around The Bottom In California
The San Diego Business Journal reports from California. “Too many buyers remain on the sidelines, according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
“One franchisee, broker David Romero, said he recently sold a one-bedroom condominium on the 12th floor of the Aqua Vista residential high-rise in Little Italy for $260,000. ‘Two years ago, you couldn’t have touched it at that price,’ Romero said.”
“Romero said a 1,500-square-foot EastLake home sold for $438,000, and the seller purchased a $525,000 foreclosed home down the street that sold two years ago for $810,000.”
“The high rate of foreclosures is expected to peak this summer and run its course by year end, said Alan Nevin, director of research for MarketPointe Realty Advisors in San Diego. ‘We should be building 15,000 to 17,000 new housing units a year, (but) last year we built 6,000,’ said Nevin. ‘As the economy really turns around, we will (have) a housing shortage.’”
The Union Tribune. “Last month, 6,524 San Diego households went into default or foreclosure, according to Default Research. More homes went into default in that single month than in all of 2005, when the market was at its peak.”
“‘The only people doing business in this market are people handling REOs,’ said local real estate broker Bob Schwartz. ‘I’ve been in this business for more than 30 years, and I haven’t seen things this bad. Things are pretty bleak.’”
The North County Times. “From the start of a housing recession that has sent average real estate prices in North County plummeting, some housing analysts said expensive neighborhoods would persevere, dodging steep declines. That’s no longer true.”
“Several homes in one of North County’s ritzier regions, the San Diego neighborhoods of Rancho Penasquitos and Rancho Bernardo, have tumbled 30 percent in value. The drop in prices has drilled gaping holes into a theory that the higher-end market could be immune to the housing recession.”
“‘All across the board, the market’s been hit,’ said Eric Elegado, a real estate agent based in Mira Mesa. ‘Homes that sold for a million, they’re going for $600,000.’”
“Recently, the rate of foreclosures has begun to approach the county average. In May, notices of default spiked. And the 129 foreclosure filings that month were 45 percent higher than the previous high for the region, set the month before, according to ForeclosureRadar.”
“‘It’s really hard for people to realize that when they try to sell their house, they’re not going to get what their neighbor did in 2005,’ said Louie Ortiz, a high-end real estate agent based in Carmel Valley. ‘A lot of people have chosen to rent it out and even take a slight negative cash flow. I talked to one homeowner who said that even if they lost $1,000 a month, it’s better than selling now.’”
The Press Telegram. “North Long Beach resident Annabel Hall remembers the nice couple and their mother that lived across the street. But like so many other homeowners across the nation, in California, and throughout Long Beach, the couple couldn’t meet their financial obligations, so their home on Morningside Street went into foreclosure.”
“She didn’t even get a ‘goodbye’ from them before they moved out, apparently in the middle of the night, she said. ‘We woke up, and … they were gone,’ Hall said.”
“That was about a year ago. Now, the brown one-story, three-bedroom stucco house seems like a stripped-down car.”
“‘They just walked away from it,’ said next-door neighbor Tom Campion. ‘It was creative financing and they got in over their head.’”
“From April 2007 to March 2008, Long Beach racked up 748 foreclosures, according to statistics compiled by the city’s Economic Development Bureau. Of those, 561 were single-family homes, while 187 were condominiums, ranging in price from $100,000 to more than $1 million.”
“Many banks are selling the homes for far less than they had been worth, said Benny Nassiri, a Realtor who works with IndyMac Bank, which owns some foreclosed Long Beach-area properties.”
“For example, a two-unit duplex that Nassiri is trying to sell on Del Amo Boulevard in North Long Beach was assessed at $510,000 in 2007, but is now listed for sale at $268,000, she said.”
“Nassiri said many banks are willing to give a loan with no or little down payment. ‘If they don’t do that, those properties are going to sit on the market and nobody’s going to buy them,’ Nassiri said.”
“Nassiri said that some home buyers may not be able to afford their loans, even if the home price is more reasonable. ‘A lot of people aren’t qualified to buy, in my opinion, but they are buying because there’s no money down,’ Nassiri said.”
“Which means the foreclosure crisis may not be over yet, she said. ‘I have a feeling the people buying today, (their) property will go into foreclosure again,’ Nassiri said.”
The Wall Street Journal. “Mark Verge, owner of an apartment-finding service in Santa Monica, Calif., says he’s getting 7,000 to 8,000 inquiries a month from would-be renters, up 15 percent from last year. Many are from people who are facing or have gone through foreclosure, he says.”
“Matthew Cooper, a 31-year-old advertising salesman, was excited to buy his first place in 2002: a two-bedroom condo with a fireplace a few blocks from the beach in Santa Monica.”
“And he found the payments on the $450,000 property affordable; his interest-only loan cost about $2,800 a month. But by 2005, the payments were about $4,500. He lost the condo eight months ago.”
“Now he’s living in a one-bedroom rental not far away for $1,700 a month. He’s had to squeeze his office into his bedroom, and he says he holds fewer dinner parties because the apartment feels cramped. Although the stress of trying to make impossible mortgage payments is gone, he would like to own again-with a fixed-rate loan.”
“‘Buying is the only way to accumulate wealth,’ he says.”
The Ventura County Star. “Community leaders are looking at the feasibility of converting 100 foreclosed homes in Ventura County into shelters for the homeless. With a newly released survey showing more than half the people staying in shelters had been sleeping outdoors and in cars, officials see a chance in the surging foreclosures and falling prices.”
“About 2,000 homes in Ventura County are now owned by banks, said county Supervisor Kathy Long, one of the key figures behind the meeting.”
“‘There has to be an opportunity,’ she said.”
The Times Herald. “The city’s bankruptcy notwithstanding, existing home sales in Vallejo are booming despite continued declines in new home sales, according to a new study and local experts.”
“The latest report from the California Building Industry Association shows overall new home sales in April were off by 55 percent over last year in the Vallejo area, a figure slightly worse than the state’s numbers, said Jonathan Dienhart of the firm that conducted the survey.”
“There were 49 sales of new homes in subdivisions of 10 units or more in Solano County in April compared to 109 a year ago, Dienhart said. And prices of those homes were down about 11 percent from a year ago, he added.”
“The activity in the Napa area is so slight it’s not statistically applicable, Dienhart said.”
“‘(Solano County’s numbers) are fairly typical of what we’re seeing around the state, which shows that we’re sort of scraping around the bottom in a general sense,’ he said.”
“The resale market in Vallejo, on the other hand, is doing well, likely because prices have dropped to levels many thought would never be seen again in the Bay Area, said Solano Association of Realtors president Lori Collins.”
“‘I wrote three offers this week and I spoke to another agent who wrote six,’ Collins said. ‘I know of a nice 3-bedroom, 1-bath home that sold for about $160,000.’”
“The plethora of bank-owned homes has forced prices down below where many homeowners can realize any equity, she said. This is bad news for homeowners hoping to sell but good news for first-time home buyers and investors, who can now hope to get rents to cover a home’s mortgage often with money left over, she added.”
“‘Real estate is a long-term investment and always has been,’ Collins said. ‘Since 1900, you can go back and see cycles like this, but in the long term, values always increase.’”
“‘Things don’t seem to be getting worse faster,’ Dienhart said. ‘The pace at which it’s getting worse is slowing. But how long we’re down along the bottom is anybody’s guess.’”
The Record Searchlight. “Redding has made itself a land deal it could not refuse. The Redevelopment Agency last week bought 113 surplus acres near Quartz Hill Road from the city for $3.2 million. That was the property’s appraised value in June 2006, just after the real estate market peaked.”
“A note on the city’s surplus property Web page said an updated appraisal on the property was needed. But Redding did not seek such an appraisal when it bought the land — known as the Hammon property — from itself.”
“‘We chose not to have it reappraised, in part because it’s a transaction between two related entities,’ said City Manager Kurt Starman, noting the legal distinction between the city and its redevelopment agency. The City Council doubles as the agency board.”
“The city could certainly use the cash from a surplus land sale right now. Money from the sale will reimburse Redding’s wastewater utility and general fund nearly $900,000 for payment of delinquent taxes, assessments and other Hammon property purchases costs.”
“The Hammon land transfer also serves a strategic purpose, Starman said. California legislators have discussed siphoning affordable housing money from cities into state coffers to help plug a yawning deficit.”
“‘We thought it would be good to encumber those funds so the state cannot confiscate them,’ Starman said.”
“The Hammon property came to the city courtesy of California’s last housing slump, in the early 1990s. Max and Marcella Hammon had applied for a subdivision map in 1990, but the property went into foreclosure in 1992, piling up unpaid property taxes, water and sewer assessments and penalties ultimately totaling $826,804.”
“The Hammon property purchase means the agency also will be funding affordable housing on vacant land near where developers over the past 10 years have built some of Redding’s largest and most expensive homes. The city bought the land from the county for $2,500 in 2003.”
“Several homes in one of North County’s ritzier regions, the San Diego neighborhoods of Rancho Penasquitos and Rancho Bernardo, have tumbled 30 percent in value. The drop in prices has drilled gaping holes into a theory that the higher-end market could be immune to the housing recession.”
“‘All across the board, the market’s been hit,’ said Eric Elegado, a real estate agent based in Mira Mesa. ‘Homes that sold for a million, they’re going for $600,000.’”
This is just the pre-game warmup, folks. Wait until the perfect storm of higher interest rates compounded by peaking Alt-A and prime resets deluges the extant 500 year flood of REO inventory due to foreclosures and vacant, never-lived-in new homes.
You ain’t seen nothin’ yet
B-B-B-Baby, you just ain’t seen n-n-n-nothin’ yet
Here’s something, here’s something that you’re never gonna forget, baby
B-B-B-Baby, you know, you know, you know, you just ain’t seen nothin’ yet
The San Diego Business Journal reports from California. “Too many buyers remain on the sidelines, according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
“One franchisee, broker David Romero, said he recently sold a one-bedroom condominium on the 12th floor of the Aqua Vista residential high-rise in Little Italy for $260,000. ‘Two years ago, you couldn’t have touched it at that price,’ Romero said.”
What will Kunz and all the other shills say two years from now when that one-bedroom in Aqua Vista is selling for $150,000?
Keep the popcorn popping,
Red Baron
Shaq-A-Laqa-Boom Boom, baby!!!
“I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
That kind of selfless caring just brings tears to my eyes.
ROTFL
They bragged how everyone would be priced out forever. Now they’re scared buyers won’t re-enter the market anytime soon.
Guess what, now that credit is back to sensible levels, most Californians who do not own are priced out. What are they going to say when REIC commissions drop to their historical fraction of GNP for a recession? We’re only halfway down the normal trend lines.
Got Popcorn?
Neil
“The high rate of foreclosures is expected to peak this summer and run its course by year end, said Alan Nevin, director of research for MarketPointe Realty Advisors in San Diego. ‘We should be building 15,000 to 17,000 new housing units a year, (but) last year we built 6,000,’ said Nevin. ‘As the economy really turns around, we will (have) a housing shortage.’”
‘As the economy really turns around…’
wawawhahwat???? you mean like in 2009? bwahahah…
“‘Buying is the only way to accumulate wealth,’ he says.”
HEY!.. what happened to using, abusing and robbing FBs,
GFs and chronically STUPID ?
Not only that, his comments are self-contradictory. If he’s afraid buyers are going to stay away and miss out on the “great prices”, who’s gonna buy all the houses and drive up the prices again?
Exactly.
As one of our astute posters said:
You can’t price me out of the market. I am the market!
“What will Kunz and all the other shills say two years from now when that one-bedroom in Aqua Vista is selling for $150,000?”
There has never been a better time to buy.
Buy now before the Europeans buy everything.
“Buy now before the Europeans buy everything.”
The Russians are coming, the Russians are coming. I know this to be true from two trusted sources!!![Not really]
Desperate realtors in small town northern Washington contributing articles to local paper claim that
Europeans and Canadians are very interested in their homes—specifically mentioned speaking to a Russian.
It’s not worth $150K. See - there’s a spot on the floor right there.
If I get down and lick that spot off the floor, will you pleeeeeeze just buy? Pleeeeeeeze?
Never ask a barber if you need a haircut.
“…according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’”
Yeah, he’s fearful my @ss. These phony news organizations continue to interview these hustlers - that’s what amazes me most.
In other news, the San Diego Business Journal asked carnival barker Jeb Lomy if $5 was a good investment for a chance to win a fuzzy toy…
‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
It looks like Mr. Kunz has real legal grounds to sue “buyers who remain on the sidelines” and are not buying now… . I wander why is he so concerned about… ?
To even remotely imply that Rancho Penasquitos and Rancho Bernardo are ritzy is way too over the top. These are generic, cookie cutter outlying suburbs with little redeeming value. Nothing around there should be going for more than $150/sq.ft. I’ll see your 30% drop and raise it another 30%.
Rancho Penasquitos and Rancho Bernardo will seem ritsy compared to the “low-income housing” [read: instant slum] cropping up in their close proximity. Love to be a fly on the wall in the granite-topped kitchens of those “ritzy” crapbox kitchens when the homemoaners who bought circa 2004-2006 find out about their new downmarket neighbors.
I’m in Florida this week and I’m going around telling people that their half-empty condos will be filled with section-8 people in a couple of years!
They don’t believe me, just like they didn’t believe me with I told them there would be boarded-up houses in brand-new developments (I was right on this one!), and that houses will be worth $0 (This is arguable. But what’s a house that can’t be sold after 2 years on the market worth? Especially when there are 10 other identical houses in your development for sale on the same block that had no buyers at a foreclosure auction? I say $0, but others disagree. In fact, it’s worth about -$10,000 a year at least for the taxes and fees.)
Already, in “Celebration” people are having trouble with neighbors renting houses and condos out for a WEEK or less, trying to undercut the bargain hotels in the area. Having 4-6 different college kids staying each week at the condo next door to you can be very annoying…
Tract housing at best. Amen.
There are legit $million+ houses in RB, but Peñasquitos? Not that I know of. But to call either one of them “ritzy”?
I think “ritzy”, “swanky”, and “classy” are all words that to me imply the opposite of what they are supposed to mean. Words like cheesy come to mind.
Hey,
That’s my job to post the lyrics.
When do you think the river is going to crest, PB?
“‘Buying is the only way to accumulate wealth,’ he says.”
The Truth Translator says this means,
“Manipulating some fools into buying is the only way for me to accumulate wealth.”
When will J6P break free of the coma and realize these tourons are lying through their teeth for the benefit of no one but themselves.
Opportunities to buy homes that redeem themselves as “good investments” don’t happen when interest rates are pushed artificially low, lower than price increases in general living costs. People who need to mortgage a property are never going to be investors. True real estate investors buy property with cash more often than debt/leverage.
Interest rates for housing need to return to a level where depositors can get a better return on their money. When simple savings accounts offer 7% returns, then we’ll see housing prices drop to affordable levels, and also offer real estate investors a great market for rentals. Of course the Fed won’t let that happen, heaven forbid the dollar actually be worth more over time than less. A stronger dollar policy means the dollar would buy more over time, which means prices would softly drop, not go up. Why can’t people realize that depreciating assets should depreciate?
If anyone tells me that “it’s a great time to buy,” I’ll remind them that low interest rates mean “it’s a great time to borrow.” Borrowing money to acquire an asset is not really buying. You buy when you own, and you own when the loan is paid off. Until then, you’re renting from a bank.
“Of course the Fed won’t let that happen, heaven forbid the dollar actually be worth more over time than less.”
True, but prices are dropping at over a 20 pct annual rate in SoCal nonetheless. Something similar happened in Japan in the early 1990s — a protracted real estate crash played out in a low rate environment. I believe the Central Bank’s predicament in this kind of market conditions is known as ‘pushing on a string.’
Until then, you’re renting from a bank.
Except when you are renting, you don’t run the risk of loss or the potential for gain.
A.B.,
Well said.
Mike
‘We should be building 15,000 to 17,000 new housing units a year, (but) last year we built 6,000,’ said Nevin. ‘As the economy really turns around, we will (have) a housing shortage.’
What happens to all the foreclosure and inventory you moron? There is a big elephant in the room and this guy claims that there is not enough people in the room. “We are going to run out of space pretty soon.” he says, standing behind the elephant.
Nevin is a spokesman/economist for the CA homebuilder trade group, IIRC.
“‘As the economy really turns around, we will (have) a housing shortage.’”
That turn around might be from a recession into a depression, not from a recession into a growing economy. Surplus capacity has been added throughout this housing collapse. That’s great for those wanting lower prices and rents, but not for those warning of housing shortages. Apartment vacancy rates haven’t been this high in a decade.
Do the following four things to navigate the current depression:
1. Get and keep a job.
2. Rent so you can be mobile for your job.
3. Save or invest at least 25% of your after-tax income.
4. Eliminate debt unless you could pay it off if you lost your job.
Keep the popcorn popping,
Red Baron
Red, I for one don’t mind you repeating your advice. It deserves repeating.
Good advice, but I have some yuppies in the real estate industry (they do some kind of feng shui design, serenity garden design, etc.) in my neighborhood, and I think it’s a little too late for them. They’re hurting bad, I have no idea how they are making their payments, I know their mortgage is over 1.5M, they’ve refinanced repeatedly to remodel, and they obviously haven’t had any clients in a long time.
They’ve already downgraded from nightly expensive sushi to Domino’s, something they never would have dreamed of ordering even a year ago. I was shocked to see the delivery guy at their door, I thought it must be a robber or something, LOL.
Which gave me the idea, do you think we should start some sort of yuppy FB relief fund, so that FBs like them can at least maintain some semblance of their former lifestyle as they proceed through the foreclosure process? You know, like lattes delivered with NODs (notice of default)? We’ve saved so much money by waiting, it just seems like the charitable thing to do.
“Which gave me the idea, do you think we should start some sort of yuppy FB relief fund, so that FBs like them can at least maintain some semblance of their former lifestyle as they proceed through the foreclosure process? You know, like lattes delivered with NODs (notice of default)? We’ve saved so much money by waiting, it just seems like the charitable thing to do.”
I’m thinking it’s the Obama thing to do. And since they are in need of another line of work, the government should just send them a Masters or Doctorate in something, and then hire them to run some program or something. And then beautify them with some free government issue plastic surgery, or something. And then give them something new to drive, like a free Escalade or something. And then get them something better to eat than Domino’s. Free government passes to all the best restaurants, or something. And after a couple of years, a guaranteed livable retirement in Paradise, or something.
That’s the difference between the Repukes and the Democraps, ya know, and least the Dems are willing to do SOMETHING.
Hello, I’m JP and I’ll be your sheriff tonight. Would you like to start with an appetizer before your eviction?
Have they thought of incorporating Joshua Trees in their Feng Shui gardens?
‘We should be building 15,000 to 17,000 new housing units a year, (but) last year we built 6,000,’ said Nevin. ‘As the economy really turns around, we will (have) a housing shortage.’
It is unbelievable how many fools have no clue what is coming in this country. How exactly does Nevin think the economy is going to “really turn around” so fast? Wages are falling as companies shift their footprint offshore, there is no savings, and the home equity extraction game is history. American consumers have hit the wall–they cannot get any more money, either by increasing their wages, reducing their savings, or increasing their borrowing. It is that simple.
This bubble burst will be much more painful than the tech bubble burst. In the housing bubble, people were speculating not merely on stocks but on the biggest “assets” most of them “own”.
Keep the popcorn popping,
Red Baron
‘We should be building 15,000 to 17,000 new housing units a year, (but) last year we built 6,000,’ said Nevin. ‘As the economy really turns around, we will (have) a housing shortage.’
So who’s stopping you?
What planet are you living on? Build more houses when we’re overloaded with foreclosures and inventory that aren’t selling. No one can afford them even with reduced prices. The economy is bad, gas and food prices are rising daily plus job layoffs and you want to build more houses ?? All, I can say if you really believe more houses should be built…go ahead, but it’s going to be hard to get a bank loan to do it. Also when they don’t sell, don’t cry .
“‘As the economy really turns around, we will (have) a housing shortage.’”
No, I think “we will a housing shortage” is what he meant to say, no need to correct with the “(have)”. Granted, his “willing” it done will be unsuccessful, but that’s certainly what he’s trying to do.
“‘Buying is the only way to accumulate wealth,’ he says.”
You can earn it too.
Buying works when you buy low and sell high.
The bottom is in when the asset is universally hated. I don’t think that we’re there yet if you have all of these Yahoos saying that the bottom will be in this year.
One coworker that moved to a town with a very good school system and who hasn’t seen prices drop told me that he saw prices drop recently. By about 20 percent. This place has a high median household income but is finally getting dragged down.
“‘Buying (by the stupid) is the only way to accumulate wealth,(for me)’ he says.”
“‘Buying (by the stupid) is the only way to accumulate wealth, (for me)’ he says”‘.
These guys are our friends. These are the guys who will keep injecting much needed capital into the system.
The NAR and all the rest of the REIC are also our friends because these are the folks that will give encouragement to the FBs to hang in there, and persuasion to the the knifecatchers to sacrifice their money.
Real Estate: The Great Wealth Re-distribution Machine.
“‘Buying is the only way to accumulate wealth,’ he says.”
Um, no, but it’s a great way to accumulate debt.
Oh, wait. This guy probably thinks that debt IS wealth.
Buying is the only way for our wealth to be accumulated by the Chinese…
“‘Buying is the only way to accumulate wealth,’ he says.”
Boy does this guy ever had a lot to learn.
“Oh, wait. This guy probably thinks that debt IS wealth.”
So many people fell for this idea and leveraged themselves to the hilt by borrowing for as many houses as they could. My sister lives in a high end gated community of exclusively custom homes in the Phoenix suburbs. Their first neighbor (a builder who built their home as well as a few others) sold at the peak for around $1.2M. My sister and her family were surprised when their new neighbors showed up with half a dozen high price cars, but no class. They’re very loud, would literally drop the F bomb outside in front neighboring children, had loud parties with lots of beater cars parked on the sidewalks, and unpleasant overall.
For the longest time, at least two years, nobody knew what they did. Recently my sister couldn’t help but notice that slowly but surely, the high price cars started disappearing, every one of them. Last to go was his Hummer, and her Mercedes Benz. Now, he’s in a used older Ford Ranger, and she’s in a used Explorer. Turns out, he was flipping houses and got burned. He’s hanging onto countless anchors, and he’s basically done. It’s only a matter of time till they lose their primary home as it’s, of course, mortgaged to the hilt. They’re going back to the hood where they came from. Suckers.
“‘Buying is the only way to accumulate wealth,’ he says.”
It worked so well for him.
“As the economy really turns around, we will (have) a housing shortage.”
tell me again why we can’t put these people in jail?
“tell me again why we can’t put these people in jail?”
I don’t want them in jail. Please shoot them or dump them 20 miles offshore in the Pacific. Let the sharks eat their own. We need to rid the gene pool of these people.
I don’t want them in jail. Please shoot them or dump them 20 miles offshore in the Pacific. Let the sharks eat their own. We need to rid the gene pool of these people.
Nah, thats to easy. This way is more fun and entertaining. As George Carlin would say round them up and drop them into a huge cage with guns, knives, swords, chainsaws, etc. Give them a steady diet of alcohol, PCP and watch them shoot, stab, disembowel and bludgeon each other to death until you have one person left standing then you put him/her on a pedestal and then shoot him/her in the head. This event could be put on pay per view and generate some revenue for the city. I’m sick and tired of having to maneuver around all those damn potholes when I drive to work!
You’ve come across a brilliant idea! Someone tell Las Vegas to build an area for Caesar’s Palace!
Actually I do like the idea. And it could single handedly save the Nevada economy. Good revenue, forbidden in other states…
I think we have a winner here.
Got Popcorn?
Neil
Finally some reality television worth watching. Make sure there a few politicians and celebrities in there just to make it a little more interesting. Who should be providing commentary from inside the cage?
“Who should be providing commentary from inside the cage?”
Ryan Seacrest, of course.
Ironic that George Carlin died today.
George Carlin R.I.P
First of all I think it’s unfair to the sharks to be compared to these a-holes. #2 I think they’d give the sharks indigestion.
“I think they’d give the sharks indigestion.”
Would it be more from the quality or the quantity?
Haha, that’s funny!!
“I don’t want them in jail. Please shoot them or dump them 20 miles offshore in the Pacific. Let the sharks eat their own. We need to rid the gene pool of these people.”
Sorry, I have to chime in here. I am totally against polluting the Ocean!!!
Was that ‘chime’ or ‘chum’ ?
I like the idea, think of the great shark fishing with all that swine blood in the water.
Very Brazilian (i.e. the cops quietly motorboat the sweepings of the favelas twenty miles offshore and invite them to start swimming). I like it.
Well then, I hope Mr. Nevin is snapping up every house possible if that’s the case. The REIC types are so unselfish…they just can’t keep a good investment secret to themselves.
Exactly.
Every time I see one of those “Great Investment opportunity!” posts on Craiglists real estate section, I can’t resist sending an e-mail [from the account I keep just for that purpose] asking if it’s such a great investment, why are you selling it?
They generally don’t respond.
Hey Sammy, make them a lowball while you’re at it, adds injury to the insult, I do.
Oh, I often do make an ultra-lowball offer, along the lines of 50% of asking price, just to remove any doubt that they’re dealing with a potential mark. You haven’t seen true vitriol until you’ve been blasted by a bitter, fearful flipper who doesn’t appreciate smug renters with flip comments about their inability to unload their alligators.
Sammy, please post a few highlights.
And a youtube video or two.
Implosion,
I don’t have any to share at the moment, as I usually delete those e-mails right away. The last blast I got was from a realtor (probably an FB as well) who was selling a 2007 Lexus on Craigslist. He was selling it at the Kelly Blue Book (KBB) retail price. I was interested, but politely informed him that only morons pay KBB retail prices, and that educated buyers would use NADA or Edmunds.com estimates instead. I got back a very pissy e-mail, telling me that he was only dealing with “serious” buyers and they’d recognize what a deal his immaculate Lexus was.
I noticed that his e-mail had a link to a real estate site - his - and since I realized I was dealing with a dickhead, I suggested he needed to take some anger-management classes to deal with his obvious bitterness from not selling any houses and probably being foreclosed on to boot. THAT jibe earned me a world-class tirade, I’m happy to report. The Lexus was posted for weeks before he finally sold it, probably for a few grand less than what he was asking.
Well Sammy, I’d offer waaay less than Edmunds.com estimate. That car is contaminated with realtwhore cooties.
Sammy…
Hahahaha! NEXT!
Good that you realize there’s plenty of shtuff for sale on craigslist and you don’t have to go for any particular one. The most valuable phrase to know when checking for-sale stuff on craigslist is “no thanks”.
What makes you think he sold it? He probably got sick of listing it, and the only people offering to buy it sight unseen as long as he was willing to ship it over to the UK (upon which they send a bogus cashier’s check for over the amount, and ask for a check for $3,000 back to cover shipping).
Why put them in jail? Instead, they should continue to poor dollars into housing and continue to create massive over supply.
“‘Buying is the only way to accumulate wealth,’ he says.”
Just like ringing a bell.
It’s over 100 degrees today… having to regulate my internal body temp with an ice cold… Gin & Tonic ;-)…sunglasses on…moving very very little, unable to help out the economy today…unable to help out Chevron today….unable to help out the airlines today, …oh, and the unemployed real estate industry? Sorry, I’m useless there as well. My stimulus check is getting rusty…Guess I’ll have to use my fingers and throw Ben a California trip “gasoline supplement bone”, …since I can’t just buy him a beer.
Hwy, been sittin’ in Rays for several days now waiting for that Squatters Beer you promised to buy me…
Is this the place? …I’ll call and order you one on me!
http://www.blackitty.net/roadtrip01/images/ut_greenrivertav.jpg
Yup, you found it! Man, I love those beer homing devices, don’t you? They work from thousands of miles away sometimes. (If you don’t have one yet and are reading this, go to http://www.findbeeranywhere dot com, only $50).
There’s a better photo of it on my youtube video, search Long Time Gone - Green River, Utah if interested.
OK, make that call, I’m the one in the back left booth (aren’t any on the right) - it’s about 100 degrees here, so hurry.
That’s it! My other post didn’t come through. Call fast! 100 degrees and rising… and some fool left the front door open and the gnats are getting in…
Hey Lost,
I just called and talked Raul…are you there? If I don’t hear from you..I’ll just go ahead and buy x2 “Sqautters” & credit it to your tab. Enjoy!
I got carried away by a gang of gnats…on my way back…
WAHOOOO!!!
But hey, Hwy, you maybe should wait, I heard a bunch of HBBers are on their way, word’s out - free beer on Hwy…
Oh heck, just go ahead and put several dozen on my account in case they show up. Thanks!
Anybody on the hook for these freebies had better be aware that it takes 2 Utah beers to make one CA beer.
“Buy now, you never know when they’ll shut us down and we won’t be making any more!”
“Every month, we have more sales than the month before,” said Romero. “There’s a lot of pent-up, first-time buyer demand.”
Who’s doing the buying? Is it first-time buyers? Is there any pent-up demand from legitimate buyers, buyers that could afford to buy the product? If there was. They’d be out buying. They aren’t. There is no such demand. Mr. Romero, don’t turn around quickly in a doorway or you might break your nose.
Oh, please, there isn’t that much demand. Inventory in San Diego is still over 20,000.
“Inventory in San Diego is still over 20,000.”
And holding steady for two years now. As impulsive as the typical American is, you’d think any pent-up demand would have shown up in increasing sales and decreasing inventories by now. Maybe that pent-up demand is from Santa Claus, the tooth fairy, and the Easter bunny with the expected resulting sales.
–
“…average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business…”
Don’t these shameless schemers ever get tired? Maybe, they should buy some homes for themselves as great investments.
Jas
With prices in freefall and few if any “average individuals” buying, it’s very hard to see where the missed opportunity is except maybe on the sell side. Perhaps I’m just a bit dense.
In such matters, it’s best to be a little “dense”.
The average individual is missing nothing but he’s missing a paycheck.
BWAHAHAHHAHAHHAHAHAHHHHHHHHHHHHHHHHH!!!
Maybe he has only been in the business for two years.
“The high rate of foreclosures is expected to peak this summer and run its course by year end, said Alan Nevin, director of research for MarketPointe Realty Advisors in San Diego.”
Statements like that should come with the warning TO ALWAYS WEAR LATEX GLOVES WHILE HANDLING, because they obviously have been pulled straight from the statement maker’s ass!
“The high rate of foreclosures is expected to peak this summer and run its course by year end”
They forgot to include the rest of the statement that HBBers know is coming…
before the next wave, which will dwarf the subprime loan issue, hits shore in 2011-2012!
‘Real estate is a long-term investment and always has been,’ Collins said. ‘Since 1900, you can go back and see cycles like this, but in the long term, values always increase.’
B.S., the agents crave churn. This is the same advice the Wall St. shills use to keep all the 401k money from wandering away. When things turn to sh*t it’s always “buy and hold”.
The Three Stages of Unsuccessful Speculation:
(1) It’s a great investment.
(2) It’s a great investment for the long-term.
(3) Somebody, anybody, please give me a bid.
BWAHAHAHAHHAHAHHAHAHHHHHHHHHHHHHH!!!
Another day of Alice in Wonderland reporting from my favorite fishwrap. The San Diego Union Tribune reports you better buy now cause interest rates are going up and they are calling the bottom next year. More fear mongering and I bet it works on a few stupid folks.
If lowering interest rates caused prices to rise via the How-Mucha-Month-Sally mechanism, then higher rates will cause prices to fall via the same mechanism.
Oh wait!
Prices have reached a permanently high plateau. It’s only gonna be a V-shaped recession. Next year, prices will resume their inexorable climb. The Boomers are coming. The Chinese are coming. The Europeans are going to buy everything up. Bernanke is going to inflate. It’s different here.
PHEW!!!
You forgot the Irish carpenters.
The strawberry-pickers are fanning out across the country as we speak, downpayment checks in hand.
This is just too easy now. It’s like shooting fish in a barrel. Where’s the sport any more?
I’m depressed.
Come on out to Ray’s Tavern, Squatters beer on Hwy50ina49dodge (see above).
You know, back in 1990 when real estate crashed the last time in California, Realtors said the Chinese were coming then too.
I guess it is sort of true, the Los Angeles area does have lots of Asian immigrants, but prices still went on to crash 30-40%.
OWP
If you have cash, the best time to buy is when interest rates are sky-high because those without cash have to pay so much in interest that they can’t pay much in principle forcing housing prices down. So bring back those 14% interest rates and let the bottoming process begin.
“One franchisee, broker David Romero, said he recently sold a one-bedroom condominium on the 12th floor of the Aqua Vista residential high-rise in Little Italy for $260,000. ‘Two years ago, you couldn’t have touched it at that price,’ Romero said.”
“Romero said a 1,500-square-foot EastLake home sold for $438,000, and the seller purchased a $525,000 foreclosed home down the street that sold two years ago for $810,000.”
I don’t understand this faulty logic that people believe since a house sold for $800,000 two years ago, it’ll be worth that much in two more years. That’s like someone talking themselves into pets.com at $1 because it traded for $20 a year earlier. People don’t seem to understand that prices that were paid in the “market” weren’t real market prices at all.
“‘All across the board, the market’s been hit,’ said Eric Elegado, a real estate agent based in Mira Mesa. ‘Homes that sold for a million, they’re going for $600,000.’”
Whoa, hold on there a minute cowboy. I thought the high end is immune from such large percentage price drops, unless of course the high end has now been redefined upwards to 2 million and above. Wait for that $600K to get between 300 and 350K and then we’ll start talking.
Montrose, Colorado, is a pretty town (once ag, but now more a bedroom community for Telluride) that’s been overrun by developers (and is now crashing hard). I recall seeing a million-dollar home there a couple of years ago and shaking my head in wonder. What the frack, a million dollar home here??? No flippin’ way!!
Yesterday while cruising the foreclosure list, there was a house for 1.2 mil. Wonder what it will go for. If you’re poor, be honest about it at least, I won’t hold it against you. Posers.
“Too many buyers remain on the sidelines, according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
So now the CEO of the company that brought us the infamous “Suzanne Researched This” commercial during the tail end of the bubble years, is “fearful” the averge individual [who appears to have a room-temperature IQ] will miss this ‘once-in-a-lifetime opportunity’ - the mantra of late-night TV pitchmen and flim-flam men everywhere.
My NAR bullshit detector tells me that what Mr. Kunz & his ilk are REALLY afraid of is the supply of easy marks (FBs) has finally run dry. The actual creditworty potential buyers in this market will be much harder to fleece than the “how-much-a-month-Harrys” preyed on by NAR hucksters and their REIC co-conspirators during the bubble years. Something tells me that Kunz’s real fear is that the gig is up, and much like a stew-bum when he realizes the bottle’s empty and there’s nothing left, he’s feeling pretty panicked right about now.
www dot NARbullshitdetector dot com
if that doesn’t work, try thehousingbubbleblog dot com
This, Mr. Kunz, is reality:
http://www.timesdaily.com/article/20080621/ZNYT02/806210346/1011/RSS&source=RSS
Rise in Renters Erasing Gains for Ownership
Driven largely by the surge in foreclosures and an unsettled housing market, Americans are renting apartments and houses at the highest level since President Bush started a campaign to expand homeownership in 2002.
The percentage of households headed by homeowners, which soared to a record 69.1 percent in 2005, fell to 67.8 percent this year, the sharpest decline in 20 years, according to census data through the end of March. By extension, the percentage of households headed by renters increased to 32.2 percent, from 30.9 percent.
The figures, while seemingly modest, reflect a significant shift in national housing trends, housing analysts say, with the notable gains in homeownership achieved under Mr. Bush all but vanishing over the last two years.
Many of the new renters, meanwhile, are struggling to get into decent apartments as vacancies decline, rents rise and other renters increasingly stay put. Some renters who want to buy homes are unable to get mortgages as banks impose stricter standards. Others remain reluctant to buy, anxious that housing prices will continue to fall.
The confluence of factors has largely derailed what Mr. Bush called “the ownership society,” his campaign to give millions of people — particularly minority and lower-income families — a shot at homeownership by encouraging lenders to finance more home purchases.
“We’re not going to see homeownership rates like that for a generation,” said Mark Zandi, the chief economist at Moody’s Economy.com, a research company.
Don’t worry, as long as the teachers keep dumbing down our kiddies, except for those we home school, there will be plenty of FB’s to go around for the next cycle.
Not to mention that when the RE market really does finally wake from the dead, I predict that companies like Redfin will kick his corporate a$$ the same way Scottrade and others have with traditional stock brokers. Or travel agents. Or retailers.
“‘Buying is the only way to accumulate wealth,’ he says.”
Wrong, Corky. SAVING, doing without, and wise stewardship of your talents and resources are the tried & tested ways to accumulate wealth.
Even Corky knows better.
What amazes me is that, after it worked out so well for him the first time, he still says it.
Fake market ,fake market ,made up prices ,made up prices .
“She didn’t even get a ‘goodbye’ from them before they moved out, apparently in the middle of the night, she said. ‘We woke up, and … they were gone,’ Hall said.”
Hardly surprising that in soulless cookie-cutter communities populated by transient non-entities, there’s no such things as true neighborly bonds. People are “nice” but don’t hesitate to move out in the dead of night and screw their neighbors as well as lenders by letting “their” homes go to pot.
Hey, Sammy, you dissin’ my landlady?
“Nassiri said many banks are willing to give a loan with no or little down payment. ‘If they don’t do that, those properties are going to sit on the market and nobody’s going to buy them,’ Nassiri said.”
This is probably the best reason of all to wait another year or two, minimum, before buying. The banks are still using their Stupid Lender Tricks to conceal the full magnitude of their mortgage-related losses, and continuing the same unsound practices, albeit on a reduced scale, that brought us to this point. That delays the inevitable, and will make the final capitulation that much more dramatic.
That has always been my preference. I want to buy when I have to work hard to qualify for a loan and people with just a slightly less desirable borrower profile than I have to pay a huge premium to get any out of a bank. Heck, it could be tighter than that. What if nobody can get a loan at all and we are all relying on buying for cash with what we thought were our downpayment accounts.
Might not work all that well here in the DC area, because there is a lot of money around. I don’t think we will ever have a complete creit freeze. But I can dream.
“Which means the foreclosure crisis may not be over yet, she said. ‘I have a feeling the people buying today, (their) property will go into foreclosure again,’ Nassiri said.”
Finally we hear some inspiring words !!
“buying is the only way to accumulate wealth” - gee, my 90 year old Aunt who rented all her life died with 700K in savings on a public school principals salary - she saved and invested in blue chips over her 40 year career. . .my parents??? House poor. . .
“the best bargains I have seen in my lifetime - buy now”. . .right, and Pets.com looked like a screaming bargain at 50 after being at 200. . .we all know how THAT ended!
me: mid 30s and crossed the 7 figure net worth 2 years ago. And I am a renter. All through disciplined savings and investing.
“On the other hand, Schwartz estimates the peak-to-trough decline could be as deep as 40 percent, which would put a bottom at $311,000.
Let’s say you’re thinking of buying a median-priced home today at $380,000, with a current rate of 6.4 percent. What if you wait a year, hoping that the price will drop to $342,000? If mortgage rates jump to 7.3 percent, you will be paying $2,282 per month on your home instead of the current payment of $2,347, Goldman calculates. With such a minimal price difference, it might not be worth it to wait a year before buying your home.”
This illustration may convince Howmuchamonth Sally that there is little difference between buying now versus next year, but for anyone who cares about net worth implications of home purchases, it is worth noting that under this scenario, you save $38,000 by waiting another year. That is roughly 1/2 a year’s worth of pretax income for the median San Diego household that could be earned by exercising bit of restraint.
And home prices are already falling at over a twenty-percent annual rate in San Diego, which would amount to a $76,000 price decline in one year on a home currently valued at $380,000 (to $304,000). I will take my chances on waiting at least until I see some convincing evidence that the rate of price declines has gone back down from its recent record rate.
Nice front page article today in the LA Times about the collapsing dollar. They even tied it in with the housing crash.
I saw a NAR commerical on TV. It ended with words similar to “On average, prices go up X% over 10 years”. I forget the exact % but I scoffed loudly nevertheless.
“double over 10 years” is what I believed the commercial said. While wages remain the same. good luck with that scenario!
Cinch
How can they legally say that? Vanguard can’t advertise a stock fund on TV and say that, unless it was prefaced and suffixed with a lot of disclaimers and gave specifics like “Past performance has no bearing on future performance, but from 1997 to 1999, stock prices went up 9% a year.”
Heck, even phony weight loss pills can’t advertise on TV unless they say “not typical, your results my vary.”
How can the “NAR” get away with an investment like this? (And why don’t Barney F. and Chris D. go after the R-E industry and try to take money from NAR member companies before they starting hitting me up with the $200,000,000,000 they need to bail out specu-vestors, houseflippers, etc.?)
OK - I just found out what the NAR commercial was http://www.realtor.org/pac.nsf/pages/HomeValues
Feckers are saying “On average, home values nearly double every 10 years”. Shesh.
The home in north Long Beach CA (ghetto) was never worth $510,000. It was the amount the lender was willing to provide 100% finance on . It could have been $550,000 or $600,000. or whatever figure they could have gotten the loan for. Just because the county assesses at the loan amount (100% finance )/ sale price does not tranlate into its true value.
This sounds dire. IS IT?
Bond insurers want $125bn of cover wiped out
By Aline van Duyn in New York
Published: June 22 2008 23:30 | Last updated: June 22 2008 23:30
Bond insurers such as Ambac, MBIA and FGIC are talking to banks about wiping out $125bn of insurance on risky debt securities in what could be the only way to limit the financial damage surrounding the bond insurers.
Discussions about “commuting” these insurance contracts, which were sold by bond insurers to banks in the form of credit default swaps, have taken on a renewed sense of urgency amid a rash of ratings downgrades in the bond insurance, or monoline, sector last week.
If agreements are struck about the value of these CDS contacts – and the discussions could take months – it could be significant for the entire financial system, which is clogged up by the uncertainty around the value of derivatives and complex bonds linked to mortgage-backed securities.
“If firms and their counterparties can get across the finishing line in their commutation negotiations, a shadow of uncertainty would be lifted from the monoline sector, with the prospect of better rating stability,” said Matthew Elderfield, chief executive of the Bermuda Monetary Authority, which regulates a number of bond insurers.
That should be interesting…
Quote from B.Gross on Pridentbear.com
“If total investment grade and junk bond defaults approach historical norms of 1.25% in 2008, then $500bn of these default contracts will be triggered, resulting in losses of $250bn or more to the protection-selling party once recoveries are inserted into the equation.”
Pimco’s Bill Gross quoted in the January 9, 2008 Financial Times
Potential buyer: I’d be more interested in yur house if ya’d barbecue up a few o’them squirrels you been feeding all these years. Can you do that for me?
Seller: Ma, where’s my gun?!
“Too many buyers remain on the sidelines, according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
I’m fearful that this guy might be retarded.
“‘The only people doing business in this market are people handling REOs,’ said local real estate broker Bob Schwartz. ‘I’ve been in this business for more than 30 years, and I haven’t seen things this bad. Things are pretty bleak.’”
This reminds me of those “Hundred Year Floods” the Midwest had in 1993. Now fifteen years later in 2008 there are “Five Hundred Year Floods” in the same places. 30 years is nothing.
There are millions of 20, 30, 40, 50, and 60 year olds who will soon tell you that economically speaking, things are the worst ever, in their lifetime. They won’t be exaggerating.
“On the other hand, what if the price drops as low as $311,000? Even with a 7.3 percent mortgage, the monthly payment would amount to only $2,080, making the wait a bit sweeter. Then again, what if the interest rate remains at a relatively affordable 5.8 percent? The list of variables goes on and on.”
Here is my estimate of the bottom for San Diego in the current bust:
Median annual household income = $65,000(+/-)
30 pct of median annual household income converted to monthly =
65,000*0.3/12 = $1625
Predicted bottom = Net present value of $1625 at 8% interest assuming a 30-year fixed mortgage = pv(.08/12,30*12,-1625) = $222,000 (+/-). (Note: You can try this formula out for yourself in MS Excel, with different assumptions about the term of the loan, the interest rate and the monthly payment for the median buyer’s home at the market bottom.)
Of course, my crystal ball cannot predict with perfect accuracy that mortgage rates will hit 8 pct before we are out of the woods, but it is worth noting that they went considerably higher than that back in 1980-1982, and have frequently gone that high since (including the last two times my wife and I purchased homes, as she reminded me just today). The 30 pct-of-income is a traditional prudent rule of thumb for mortgage lending which I expect to come back into vogue before the bust is over.
I decided to assume a $75,000 median homebuyer income and 10 pct downpayment with my bottom-caller scenario; see below.
I just ran some numbers on the SD median price. I am guessing the median will bottom out around $284,000, assuming the median buyer makes a 10 pct downpayment, faces an 8 pct (APR) mortgage rate, has a $75,000 household income w/ payments at 30 pct of income, etc.
How does that sound to y’all?
P.S. $284,000 is 25 pct below the recent median of $380,000. At the recent rate of decline, we would reach this level by some time soon after next year’s Souper Bowl.
I should add that my scenario assumes the global financial markets will not self-immolate in a catastrophic meltdown by this time next year.
Definitely agree that SD will see median prices in the $200K range…possibly worse, if the economy get real ugly.
The Ventura County Star. “Community leaders are looking at the feasibility of converting 100 foreclosed homes in Ventura County into shelters for the homeless…
hmm..
So before I buy a home in Ventura, I should factor in the chance that community leaders might someday see fit to house any number of street people into homes in my neighborhood..
I’ve come across some genius marketing ploys, but this one takes the cake.
This has always been a standard “risk” in real estate. You have to assume the worst possible scenario for that empty house, lot, building, etc. on your block.
The R-E agent will tell you that the field next to your condo is zoned “green space” and will never be developed. And after you move in, it becomes the new recycling drop-off center, etc. (An actual story from a Sacramento-area acquaintance.)
You have to assume that if there’s a dozen bank-owned houses on your block, they’re going to become half-way houses for pregnant crack whores.
The San Diego Business Journal reports from California. “Too many buyers remain on the sidelines, according to the CEO of Century 21. ‘I’m fearful that … the average individual will miss what I think is one of the greatest opportunities I’ve seen in my years in this business,’ said Thomas Kunz in a recent interview with the Business Journal.”
Now don’t you think it would be easy to prove that Thomas Kuntz, CEO of Century 21, had the exact same sentiment that NOW was the time to buy during the day the R-E market reached its all time bubbly peak?
A little googling reveals that in 2004, Mr. Kunt was saying things like this:
Real Estate remains a solid investment despite fears about dropping values[...]News headlines routinely pop up proclaiming the “housing bubble is about to burst”. Such pessimism is unfortunate because it can cause some of us non-economists to become nervous about our home investment.
If I can find quotes like this with 10 seconds of of goolging, can’t these “reporters” do the same thing and challenge this guy?
“Matthew Cooper, a 31-year-old advertising salesman, was excited to buy his first place in 2002: a two-bedroom condo with a fireplace a few blocks from the beach in Santa Monica.”
“And he found the payments on the $450,000 property affordable; his interest-only loan cost about $2,800 a month. But by 2005, the payments were about $4,500. He lost the condo eight months ago.”
“Now he’s living in a one-bedroom rental not far away for $1,700 a month. He’s had to squeeze his office into his bedroom, and he says he holds fewer dinner parties because the apartment feels cramped. Although the stress of trying to make impossible mortgage payments is gone, he would like to own again-with a fixed-rate loan.”
“‘Buying is the only way to accumulate wealth,’ he says.”
This guy has to be mentally retarded. there’s no other explanation.
He’s renting for $1700, and he paid from $2,800 to $4,500/month for his condo from 2002 to 2007.
Let’s presume the average monthly price of his condo, with all HOA fees, insurance, etc was $3650.
He’s renting for $1700.
$3650 - 1700 = $1950
$1950 * 60 (months) = $117,000
If he just put his money in a shoebox, he would have had $117,000 if he had rented these past 5 years.
(Of course, he probably paid his mortgage the past few years by borrowing on credit cards, etc, so maybe not. And he seems like the type of guy who, if he found $117,000 in his lap, would blow it all on a car.)
and he says he holds fewer dinner parties because the apartment feels cramped
Oh the humanity? Fewer dinner parties? That surely is the bellweather of recession!
Give me a break.
“Matthew Cooper, a 31-year-old advertising salesman, was excited to buy his first place in 2002: a two-bedroom condo with a fireplace a few blocks from the beach in Santa Monica.”
“And he found the payments on the $450,000 property affordable; his interest-only loan cost about $2,800 a month. But by 2005, the payments were about $4,500. He lost the condo eight months ago.”
Something doesn’t add up on this one… A 30-year fixed rate mortgage would’ve cost about that much (450,000 @ 6.5% = $2844/mo.)… either he actually paid a lot more than that 450,000, or he really got himself hosed.