Still Waiting For The Sonic Boom
The St Petersburg Times reports from Florida. “Gov. Charlie Crist stood before hundreds of Realtors in Orlando last summer and predicted fantastic things about the property tax cuts on the January ballot. ‘Florida’s going to have a sonic boom when this happens,’ he said, using rhetoric he would repeat again and again over the next several months. ”You’re going to be busier than you’ve been in your life. Get ready, get your rest, make sure your license is up to date.”
“Five months after the vote, Florida is still waiting for the sonic boom.”
“To fully benefit, however, homeowners need to be able to sell the home they are leaving. John and Melanie Scharch moved to Hernando County last year from the Keys. The couple carried $235,557 in accrued Save Our Homes benefit from their old home, reducing the assessed value of their new home to $93,336.”
“‘It’s great,’ said John Scharch. ‘But until I sell my other house, I’m not saving anything. I’ve had three people look at it and they really like it, but they say, ‘I have to sell my house first before I can buy yours.’”
“A steady trickle of potential buyers streamed through nine downtown developments Saturday as part of the Urban Tour of Homes. The price tags ranged from the $180 thousands to the millions.”
“‘Everything is down here right now except the people,’ LaQuinda Brewington said. When asked ‘which comes first, the residents or the retail?’ many people Saturday said they believe the retail will follow. And when it does, maybe they’ll have a prime piece of property, Brewington said.”
Steve Pralle of Hyde Park (is) considering buying property to rent out. He was weighing whether this is a good time to invest, and cautiously optimistic that in six to nine months the market will be back on the upswing.”
“‘And hopefully there will be quick appreciation,’ he added.”
The Herald Tribune. “Federal regulators are worried that some banks in Florida and across the nation may be ill-prepared to deal with their battered loan business. U.S. banks have set aside just 89 cents to cover every $1 in nonperforming loans, or loans that borrowers are no longer paying off, said Sheila Bair, chairman of the Federal Deposit Insurance Corp.”
“That is the lowest ‘coverage ratio’ in 15 years. In Florida, the coverage ratio is just 50 cents per $1 in bad loans.”
“Bank analyst Richard Bove of Lutz says the outlook is not good. ‘The impact on banks will be to drive loan losses to levels only experienced in a depression,’ Bove said. ‘The annualized first-quarter 2008 domestic loss numbers are higher than in any year than 1934 already.’”
The Miami Herald. “Las Olas Riverfront, the distressed retail and entertainment complex along downtown Fort Lauderdale’s New River, is slated to go on the auction block. A Boca Developers company bought the property for $31.9 million in 2005, intending to raze it. The developer earlier this year unveiled plans to build two condo towers, offices, shops and entertainment.”
“But Boca Developers’ vision unraveled after the company ran into financial troubles resulting from the turmoil in the real estate market. A New York concern called ACF Riverfront moved ahead with the foreclosure. ACF Riverfront is owed about $22 million.”
“‘There will be an investor who will buy the thing,’ said Michael Cannon, a Miami real estate analyst. ‘The question is what use the property will be put to.’”
From Marketplace. “U.S. mayors are working to resolve the housing crisis by using federal money. Rampant foreclosures are especially hurting cities by choking off property tax revenues that fund city services.”
“Frank Ortis is mayor of Pembroke Pines, a city near Miami. He says people getting kicked out of their homes are adding to urban blight. Ortis: ‘Some even poured concrete down toilets, put holes in walls. And then you have the over-growing of the grass. And you have pools, in Florida especially, turn green and become mosquito-infested.’”
The Sun Sentinel. “It’s a nice-sized house in a country club neighborhood in Delray Beach. The owner put it up for sale in December 2005. Despite having its price slashed more than 50 percent, the house has sat. And sat. Current days on the market: Nine hundred and twenty-six - and counting.”
“‘It’s been a tough one,’ admits real estate agent Louis Levy. ‘It was listed at $699,000 two years ago and now it’s $329,000.’”
“At least 1,058 have languished for more than two consecutive years in Broward, Palm Beach and Miami-Dade counties. Yet even that estimate is too low, ZipRealty said, because the numbers don’t count homes pulled off the market and put back on when sellers switch agents, make improvements, or let the listing expire and enter a new sales so the home does not look stale.”
“‘It’s very hard for people to adjust their mind to the new value of the property. They all have this mind-set, ‘I can afford to keep it for two years and sell it when the market recovers,’” said real estate agent Jackie Moore of Fort Lauderdale. ‘But in the ’70s, it took almost 14 years for real estate to rebound.’”
“‘I’ll take it off the market and stick it out if I have to,’ said Charles Resta of Fort Lauderdale, whose Harbor Beach home has been for sale since November 2006, despite dropping the asking price from $1.9 million to about $1.4 million.”
“Steve Lee moved from Pompano Beach to Los Angeles but hasn’t been able to sell his three-bedroom condo, which he put on the market in April 2006, despite cutting the price from $224,900 to $99,000.”
“Part of the problem, he said, is the home was damaged after a water leak and sewer backup. The repairs are done, but he’s still tied up in lawsuits with his condo association. He’s begging the bank to foreclose so he can cut his losses.”
“‘I don’t want a penny, just take it,’ Lee said. ‘It’s absolutely destroyed me - mentally, physically and emotionally.’”
“A $1.7 million waterfront mansion in Fort Lauderdale’s South New River Isles (was) offered three years ago by developers before ground was broken. ‘We used to sell them before we finished them,’ said Ken Fernandez of Kenco Builders. ‘Now I’ve got it listed at a loss.’”
The Orlando Sentinel. “Countrywide, the nation’s No. 1 home lender and poster child for the mortgage crisis, is marketing 1,600 homes in Florida and more than 200 in Central Florida alone. Countrywide has slashed prices, with some houses listed at 40 percent less than what their owners paid at the height of the real-estate frenzy just two years ago.”
“In case you needed more proof of just how artificially inflated home prices were and how foolishly banks signed off on loans to pay for them, this is it.”
“George Philbeck, an agent in Orlando, has several listings for Countrywide-owned homes. On some, he said, he has received eight and nine offers. ‘About 90 percent of homes are getting very little traffic and not selling,’ he said.”
“That’s because they aren’t priced right. Many sellers aren’t willing to let go of the dollar amount they think they would have made on their house two or three years ago. Banks, unlike individual sellers, are often willing to hack the price.”
“‘The banks are interpreting value based on the amount of traffic and the competing market, and they’re making their pricing decisions and adjustments based on facts, not emotions,’ Philbeck said.”
“The home at 2067 Marsh Hawk Circle in the Hunter’s Creek area, for example, sold for $343,000 in 2006. It is now listed for 43 percent less — at $194,900, according to Countrywide’s web site. It’s been reduced at least three times, according to previous listings that show the bank at one time asking $259,900.”
The Atlanta Journal Constitution in Georgia. “Caleb Atkins gave himself a heckuva birthday present Sunday: a two-bedroom, two-bath condominium on the top floor of the Tribute Lofts building east of downtown Atlanta.’
“Tribute sold 26 units in an unusual one-hour auction Sunday at the Omni Hotel at CNN Center. The developers, Greg and Brian Wohl, decided to go the auction route because the condo market is so sluggish.”
“‘I’m about to go and celebrate pretty heavily,’ said Atkins, a Georgia Tech graduate who works in Suwanee and turns 25 on Friday. ‘I prefer to live where I play.’”
“Even before learning of the auction, Atkins was planning to buy a Tribute condo and say goodbye to his house sharing in Virginia-Highland. ‘But two days before I was to make that offer, the auction was announced,’ he said. ‘We freaked out. The two-bedroom unit that I couldn’t afford, I could afford now.’”
“Atkins is a homeowner for the first time. He paid $263,000 - the highest price at the auction - for the 1,306-square-foot unit. Atkins pointed out his winning bid was ‘30.77 percent’ less than the original asking price of $379,900.”
“Four more units were not offered for sale when the sellers ended the auction ended early; they feared prices might go too low as the crowd thinned. The project still has about 40 market-rate units left to sell, which will be reduced in price as a result of the auction, Wohl said.”
“The cheapest sale was $132,000 for a 795-square-foot one-bedroom unit that originally was priced at $183,900.”
“Paul Nichols, a 30-year-old Georgia Tech graduate, earned a round of applause as the first winning bidder. He paid $144,000 for his one-bedroom unit. Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.”
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
‘I’m about to go and celebrate pretty heavily,’ said Atkins, a Georgia Tech graduate who works in Suwanee and turns 25 on Friday. ‘I prefer to live where I play.’
‘Paul Nichols, a 30-year-old Georgia Tech graduate, earned a round of applause as the first winning bidder. He paid $144,000 for his one-bedroom unit. Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.’
I’ll say it again. These downtown condos are only bought by dumb barflys and speculators. Both have a limited shelf life and end up trying to sell.
I’m not sure any one-bedroom condo in the bar district is worth more than 100K or so. These so-called “bargains” are only salable to swinging singles (not families) simply as a matter of size and location.
“These downtown condos are only bought by dumb barflys and speculators.”
That’s especially true of those buying in downtown West Palm Beach right now. Not so much the speculators, but the bar flies.
I thought they were for the retirees that like partying at the Rock Lobby until 4AM? That’s what my REwhore told me anyway, after I asked her who could possibly afford 800K for a 2BR in the “barfly” district of WPB.
It’s amazing that these people could even delude themselves to believe their own BS. Why on earth would retirees want to live in downtown WPB? Come on folks; its somewhat dangerous, it’s all walking everywhere, and the biggest attraction is that there are 10 bars in walking distance. That’s what retirees want? WTF?
I know a couple of Social Register types who live in what I would call downtown WPB quite happily. They are a few doors away from the water that separates WPB from PB, and have a very attractive house. condo, no.
The deaf, dumb, greedy and stupid in Florida may have missed the explosive “Sonic Boom” but they will be dying for years from the Radioactive Fallout amist their Toxic Housing Waste
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
No, YOU are already in trouble, you dumb kid. You just don’t know it.
“Paul Nichols, a 30-year-old Georgia Tech graduate, earned a round of applause as the first winning bidder…he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.’…‘And if it doesn’t,’ he said, ‘America is in trouble.’”
Brings new meaning to the term Ramblin’ Wreck from Georgia Tech…
I wonder if he started out there at 18?
Looks like Tech has been going a bit easy on the entry requirements if this genius is any indication.
Condos should have remained a niche product. All they do is allow for the REIC to convince people at ever earlier ages to take the plunge. It used to be quite common while growing up that the parents of my friends did not buy until they turned 40. Now the shackles are on tight before the ink even dries on their diploma.
Prediction: those behind Gen X&Y will pick up on this and eschew condos altogether - and so the wheel turns.
He got off easy though. Atlanta is averaging less than $300 per square foot in the hottest areas (e.g., walking distance to good restaurants, clubs, entertainment) for newer high rise condos with great views, which you can get for $250 psf if you look hard enough and drive a hard bargain. You also get one parking spot per bedroom standard. Denver pushing $400 per square foot for like condos in like areas, with many 2bdrms in this price range only having one parking spot. Denver downtown condo market has yet to break.
How do the job markets in ATL and DEN compare to Chicago, Houston, or Dallas?
I dunno, but paying that much per sq. ft. in Chicago seems absurd - and I have a very difficult time believing the regional economies of DEN and ATL are each larger than ours.
I have not done a salary comparision, but my guesstimate having lived in both cities is that Atlanta would have a lower average income, but would have a much higher number of ppl making over $100k (Atlanta has a poverty problem, but also has many high paying jobs; whereas in Denver most ppl are close to the mean, at least that is how it seems to me). Atlanta is about 20-40% cheaper then Denver in all areas, but had a condo explosion in the last 5 years which will drive prices down for at least 10 years in my opinion. I agree, anything over $200 per sq ft sounds crazy to me, unless it is waterfront. Note that I’m talking about the newer high rises in walkable centers, as opposed to condos that look like surburban apartments in outlying areas which are much cheaper.
Much of the high paying jobs in ATL are tied to the finance and banking industry. It will be interesting to see how that plays out. I dont follow the other cities you mention, so any guess would not even be an educated one.
“Much of the high paying jobs in ATL are tied to the finance and banking industry.”
The same can be said of nearly every city nowadays. We will see, time will tell.
I agree with $200/sq. ft. as a ceiling for prime locations, but that too is really not our call.
edgewater, that’s a good point (late age of first house purchase by earlier generations) - my father (Yale ‘28) didn’t buy a house till 1948, despite always having a good job. Of course, it was obvious during most of the interval that house prices could Only Go Down!
“Five months after the vote, Florida is still waiting for the sonic boom.”
When it happens, I’m thinking quite a few windows will get shattered.
“‘It’s very hard for people to adjust their mind to the new value of the property. They all have this mind-set, ‘I can afford to keep it for two years and sell it when the market recovers,’” said real estate agent Jackie Moore of Fort Lauderdale. ‘But in the ’70s, it took almost 14 years for real estate to rebound.’”
Preach it brotha! Now when J6P states that as common advice, its time to start looking. When the same types of people who screamed at you to buy scream “hold off,” buy. But wait for the blood in the streets.
Got Popcorn?
Neil
“Five months after the vote, Florida is still waiting for the sonic boom.”
Mr. Crist is very good about making statements like this. Only problem is he fails to deliver. This is the same man who said that we didn’t really need private home insurance, “The People’s Insurance Company” was ready to pick up the slack.
I think he should change the (R) next to his name to (S) for socialist.
It should be (L) for lightweight. Crist, who obviously aspires to national office, is a paradigmatic poser and would be at home in the world of professional wrestling — he enjoys playing the role of governor, but has an aversion to the actual governing part of the job.
Just look at what he did to Allstate because they dropped his mama. He can throw his weight around a little bit. I just think it’s better used for the good of the state rather than trying to drive out private companies.
Just look at what he did to Allstate because they dropped his mama.
Allstate needs to go as they have done significant harm to Florida. Thinking about using Allstate? Just ask any personnal injury lawyer if they would choose Allstate and see what type of answer you get.
“Crist, who obviously aspires to national office, is a paradigmatic poser and would be at home in the world of professional wrestling …”
Wasn’t there a wrestler who became Governor?
(He looks a little anemic to be a big time wrestler.)
paradigmatic
http://en.wikipedia.org/wiki/Paradigmatic_analysis
paradigmatic poser google search points back here
poser unqualified would be better
I hope Crist is off McCain’s short list for VP..
You would thing a simple google search on Charlie Crist and the Green Iguana would be enough for McCain to drop him from consideration. Crist is just a liar who says what people want to hear and refuses to actually show people who he really is or what he really thinks. Look at his immediate change favoring off-shore drilling last week after McCain came out in support.
When I first heard McCain was considering Crist (several months back), I felt very annoyed, because HBB had already introduced me to Mr. Crist’s BS about the SOH portability and how it was going to save the FL RE situation. If I were an Obama supporter, I suppose I’d be glad that McC might pick a nincompoop like Crist.
or Sh*thead.
“…said real estate agent Jackie Moore of Fort Lauderdale. ‘But in the ’70s, it took almost 14 years for real estate to rebound.’”
Oh, to make a sale…suddenly “they” find “fear” statistics that go all the way back to the “70s?
To the Seller:
Quick, lower your price & sell now… or else: you’ll be stuck with it for the next 14 years!
To the Buyer:
Quick buy now…or interest rates will go up to 14%…and you’ll be “priced out” forever!
They should of had public service announcements against the fluff and fear talk of the sales people during the boom and now after the boom.
I saw one of those Home programs on TV last night where the commissioned sales person was telling the first time home buyer that the area that he was buying in was going to go up in value .The operative sales pitch was ,”This is a up and coming area ,and it will go up in value .” I think sales people should be barred from making such assertions . I felt sorry for the first time home buyer ,who you could see was believing every word the agent was saying . Can’t the sales people just show the house and stop making future projections on value . If anything right now many areas have the potential of value going down .
HW,
Just as Securities Licensed sales people already ARE!
Exactly. And thank you.
Every communication with the public should be loaded with upfront disclosure like “Not FDIC Insured” and “May Lose Value” right on the cover of the Red Herring.
I saw it too! How about the part where the wife looked at a house while the hubby was out of the country, and had to make an offer immediately because “there was another offer on the table”. Then magically their offer was accepted even though it was below the listing price.
That realtor suckered ‘em right in, she did.
‘Paul Nichols, a 30-year-old Georgia Tech graduate, earned a round of applause as the first winning bidder. He paid $144,000 for his one-bedroom unit. Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.’
The average GA Tech engineer right out of college makes at least $50,000+ - so at least these folks actually can afford to live in these condos…
And he can afford to lose his ass when he goes to sell it as well. It’s the greater fool plan. We’ll see who it is.
And he can afford to lose his ass when he goes to sell it as well.
The life experience lesson he will soon learn will be his most valuable lesson in life once he experiences the decline of his property value and inablility to sell his great buy.
Experience is such a good teacher to those who fail to do their homework or take shortcuts!
Sounds about right……..except for the fact that he will have to compete with all those H1B’s that swarm in from Chindia and are willing to do his job for a bowl of rice and a mat to sleep on…He may just have to change jobs to see salary growth over the next few years.
Also, what happens when his careless drinking days are over and he wants to start a family with that chick he meets in the downtown bar ? Sell the condo for…”gasp”..a loss ????
Nobody, even the recent college grads, will go unaffected by this NAFTA bullsh!t and the “global outsourcing” that we have come to accept as the norm.
..
“Also, what happens when his careless drinking days are over and he wants to start a family with that chick he meets in the downtown bar?”
The condo fad absolutely depends on the easy flip for its survival. A buddy found himself in this exact situation two years ago - his answer? Become an accidental landlord. Now he’s bleeding on two condos and we’re just getting started.
But at least the Mississippi River is subsiding.
Though an unintended consequence might be rising popcorn prices.
I admire engineers, and know the course work is tough. But they seem to exude the same hubris my computer-programmer brother exuded back in the 80s, before Unisys laid him off at age 51. He missed the whole Windows-PC revolution and never really worked again.
Globalization is the reason that my father’s side of the family came to America. And that was back in the 1800s.
LOL
Nobody, even the recent college grads, will go unaffected by this NAFTA bullsh!t and the “global outsourcing” that we have come to accept as the norm.
Well said Les Pendens!
The global economy is nothing more than a plan by the business leaders to offshore U.S. college educated jobs to countries that have low labor costs. NAFTA is simply a plan to shift mainly blue collar industrial jobs to lower wage countries.
Both of which ends up putting bonuses into the hands of senior management and leaving the American worker unemployed and unable to pay their loans. Our political leaders are corrupted by big business and could care less what happens to the public as long as they are getting taken care of by big business.
Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.’
Hehehe - How long can you tread water?
Seems to me these people are young and have many years to wait out any downturn. Cynicism abounds today - be nice folks…..:-) They can afford their payments and that’s all that matters.
My landlord has just raised my rent to $1600 for a POS 2/2 condo in San Jose that he has no intention of ever upgrading, so right now buying my own place is beginning to sound really attractive!
Wow, I hadn’t realized rents were “shooting up” in San Josebag. They’re pretty much frozen in place or dropping almost everywhere else in the Bay Area, but , hey –thanks, for the tip, potential realtor! I’m gonna run out and buy me a condo for 500X monthly rent right now! And gimme one ‘o them “affordability product” loans, too!
Oh, and if my brilliant planned flip doesn’t work out, “America’s in trouble”.
Potental Buyer, if that $400,000 property declines by 10% over the next year, you will be incuring a $40,000 loss, which is $3,333 a month.
We just renewed our lease for another year. One day we’d hope to buy, but leveraging by 3 or 4 to 1 into a declining asset - and paying interest for the privilege - just doesn’t make sense without some very compelling reasons.
One has to have a high floor for the drop, eventually, to be effective/final.
No use jumping from the second floor.
Steve Pralle of Hyde Park (is) considering buying property to rent out. He was weighing whether this is a good time to invest, and cautiously optimistic that in six to nine months the market will be back on the upswing.”
“‘And hopefully there will be quick appreciation,’ he added.”
Cash flow? Cash flow, anyone? Steve, face it, you are a speculator. You can’t call yourself an investor and HOPE things will appreciate quickly.
“You can’t call yourself an investor and HOPE things will appreciate quickly.”
Sure you can, they did it in 2003, 2004, and 2005! It will happen again…just have to give it about 75 years.
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
this statement is in need of revision.
“and if it doesn’t,’ he said, ‘the american taxpayer is in trouble.’”
dodd and other “bail out the banks” politicians would agree.
and also… i would love to know the financing arrangement 25 year old mr. atkins got for that 263k.
“Paul Nichols, a 30-year-old Georgia Tech graduate, earned a round of applause as the first winning bidder. He paid $144,000 for his one-bedroom unit. Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.”
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
What are you going to us if your prison cell doesn’t appreciate, Paul?
Don’t forget we are all have been warned! Paul will unleash is wraith of vengeance upon you nonbelievers.
Cinch
“Paul Nichols. . . paid $144,000 for his one-bedroom unit. Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.”
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
Bingo. As the artificial value created from houses slips away, the US economy is toast.
Keep the popcorn popping,
Red Baron
[He's a...] Ramblin’, Gamblin’, HELL OF AN ENGINEER!
I am surprised that educated people exist that don’t even know America is already in serious trouble. It is shocking to me. I guess there is no time for current events when juggling school, playing video games, and bar hopping.
My nineteen year old son-math major and junior in college-knows. He laughs at his classmates who don’t. This summer he’s taking general eduaction classes at the local technical college that will transfer because they are much cheaper per credit hour.
“Life is trouble. Death, no.” — Zorba the Greek
Pity about the Las Olas Riverfront mess. I had a lovely birthday lunch there last year after a trip to the museum nearby.
BTW, there was a kick-butt letter to the editor in the HERALD business section reaming Yun and his realtorish ilk for their skanky ways. I would quote from it, but I didn’t save it. Monday is trash day, so I read the paper FAST and then get rid of it. But it was cool to see the dork put in his place.
I’m waiting to see what my property taxes look like this year. Last year, with the inflated property price thanks to the boom, I paid 7+K. It hurt. Really hurt. Ouch. You’d think I was living in a fancy-schmancy place instead of an old (and in dire need of updating) 40+ year old, ordinary, antiquated, Miami middle class home.
I’m not expecting a tax break. But shoot, I’d love one. I kinda resent paying 2400 just to the public school system when it’s doing a crap job down here. I’m still fuming over the teacher’s union scandal of some years back (Pat Tornillo), and the bone-headed behavior of the school board for, well, ages. And since hubby and I went to parochial schools (which our parents paid for without any voucher benefits) and since we’re childless, I’m feeling seriously gypped.
Ah, I whine too much when I don’t sleep enough.
M.
Huh. I was walking around the Las Olas Riverfront area in March 2007. Seemed nice enough, but not very busy.
Saturday was amusing: in the morning, while reading the Tampa Tribune’s public relations puff piece on the realtors’ downtown parade of overpriced condos scheduled for that day, I heard some ominous distant booms. Shortly thereafter, the skies darkened and we had one of the drenching downpours that announce the beginning of our summer rainy season. It proceeded to rain heavily off-and-on all weekend.
The Tribune’s article quoted some real estate people claiming that the unsold downtown units, many of which are located in building projects that have filed for bankruptcy, are “holding their value.” No one was quoted to the contrary, and no one identified any demographic willing to pay $350,000 in 2008 for the privilege of living across from a Hooters or an expressway on-ramp.
“…many of which are located in building projects that have filed for bankruptcy, are “holding their value.”
Ha! Ask them to provide you with a list of three reputable lenders that will do a mortgage in a BK building.
Cash will dictate condo prices for a long time to come.
I live in a fairly ghetto town. My house value is about 1X my income (and dropping as the value drops and my income goes up). Our town experienced a terrible boom when lending standards dropped, and there are dozens of foreclosures and REOs within 2 blocks of my home.
But the city expanded. New fire department, new police department, new 911 center, TIFs for high end restaurants (???), TIFs for retail stores. Many of these expansions are either failing, beyond budget, or useless. I’ve screamed to the PTB over and over that the recent gains in property taxes would be huge budget deficiencies in a few years. None listened.
Last year, I started a small newsletter to provide to my neighbors (about 2000 per month) in both English and Spanish. I explained how these new functions would not help them, but harm them. We had a nuclear plant in our town years ago that subsidized property taxes to be the lowest in the county by far. That plant is shut down, thanks to the Feds and local morons.
So now our taxes are high, terribly high. Renting is FAR cheaper than buying in every case, and in some cases rent is below property tax costs for a similarly sized property.
So I’ve told my neighbors, and the PTB, that the town could boom again if they would cut back on services significantly and get property taxes down. Unfortunately, the teachers in our town wouldn’t have it. The police, who do no protecting and just like to write tickets, wouldn’t have it. The business groups won’t have it. These people just don’t understand.
If we can entice more people to live here because of the low cost of living, many of these functions would have purpose and private funding. The stores that close would reopen. The restaurants, empty at 7pm on Friday, would be jumping. The crime rate would decrease as more employment opportunities were presented.
Instead, they’re going to keep services where they’re at, and probably expand them because “people need the government here.” No, we don’t. We need them to go away. Close the doors, sell the properties, and move on. We’re allowed to own guns in this part of Illinois. Homeowners are already protecting themselves. The police stay out of the bad neighborhoods, for good reason. Let the animals kill themselves, I say.
But it won’t be good. It will be very, very bad. And that’s fine with me. I dream of the day that the public nannies (public teachers) lose their pensions. I’ll happily swap them a room to sleep in for mowing my lawn and pulling my weeds. The pension bubble will burst, soon, and the towns will be in even worse shape.
“TIFs for high end restaurants (???), TIFs for retail stores.”
That’ the kind of thing they’re pushing here. It seems like no one in govt or in the nonprofits resist, because (1) the liberal New Urbanist crowd want all the downtown renovation, and (2) the conservative GOP crowd despises and fears downtown so much that they think these projects will help make them safer and more attractive. But I don’t think one of the latter will ever set foot in downtown except to go to govt meetings, esp. if you live miles away and there are nice restaurants and shopping closer to home.
Can’t help but wonder why you choose to live in that area?
Anyways, regarding the comment about teachers, whether they deserve pensions or not is questionable, but keep in mind that it’s the policy makers and officials (and therefore the voters) that control the destiny of the average teacher, not (to any significant extent) the teacher themselves. If you see them as nannies, babysitters, perpetual test administrators or whatever else, it’s through no choice of their own.
Went down to St Augustine Beach for the weekend. RealTard lawn ornaments abound.
And there were no people. Traffic was very light and every hotel had vacancies. We were only planning on a day trip but after pricing a few rooms we got a really nice beach-front place for $100. Actually the first place we stopped had rooms (off the beach) for $120. I said no-thanks and got in the car and the desk attendant (owner/operator) came running out and tried to flag us down. This I’ve never seen in my many years of beach-going. Hotel owners beggin for guests… on a weekend… in June. It’s gonna get a lot messier in Florida.
That is hilarious, but it is common lately. If they don’t bother to make a counter-offer, I always walk. I was staying in Chicago overnight a few weeks back (too much scotch for one night) and went to my favorite hotel downtown. Last minute, 10pm. Rooms available. Price? Same as on their website. Bu-bye. Walked down to my second favorite hotel (huge bedroom, bath, kitchen, dining room, living room, and sitting area!) and got a room for half the published rate. They didn’t even counter.
Slept 1 block from Watertower Place, and got a great rate. I always haggle hotel prices if it’s a last minute deal. They’re morons for passing up any offer, as long as it pays for changing the sheets and cleaning the place up the next day.
Good for you for walking.
It felt good too, after all the times that I’ve paid way too much for a dump. I did drop a tweny for the cleaning lady on the way out. Figure it must be tough for the service workers right now.
I’m noticing fewer cars on the Tucson streets. And it’s not just the “snowbirds and students are gone” traffic decline. This goes way beyond that.
Not that I’m complaining. Fewer idiots behind the wheel means a better bicycling environment for Slim and many others.
just came back from a quick 2-day trip to Tampa. noticed a lot of economic indicators, none good;
the best western on s. dale mabry went from immaculate to having sticky dingy carpets in serious need of cleaning. disgusting! the day clerks are apethetic & sit at the front desk laughing at internet IM’s all day. really pathetic. thats what happens when penny-pinching sikh indians run things. misery for everyone else while they continue to profit. you see it daily here in CA so its no great surprise.
sheriffs car at the intersection of azeele & s dale mabry, for the “construction safety angle” of course. however, not a work crew in sight. no traffic. just some cones down the middle. while the deputy sat there in his car collecting some nice overtime mandated by the generous FL legislature requiring OFFICIAL LEO’s at construction sites. same scene repeated throughout the city. lovely.
a new interchange construction project leaving the airport, some winding multi-level monstrosity. half finished, of course. I was laughing so hard that a fellow passenger asked me why?
I explained that the downtown interchange (malfunction juntion) area has had non-stop construction for over 15 years … with no end in sight. now here is ANOTHER ONE ?!? lordy, the obvious corruption in FL just makes you wince, and all you can do is laugh!
couldnt get a taxi out of downtown tampa to get back to the airport. even after 5 calls within 90 mins. I went to plan ‘B’ and took the bus (#30), and after clearing airport security arrived in the nick of time to my gate. heres why; arriving to the airport you will see over 30 yellow & white cabs lined up beside the road with the drivers SITTING OUT SLEEPING BENEATH THE TREES !! I was livid, to say the least. typical FL lazy BS. (hey cabbies, if you cant afford the gas to handle fares then get a goddamed Civic or another line of work. yeah I know you drivers lease the gas guzzlers from yellow cab but still … they DO have a contract awarded from the city & if they cant or wont service the citizens then get the fuk out of the way for someone who will. azzholes !!!!!!)
needless to say, except for the great beaches & some nice people, I HATE that stinking humid hellhole of an excuse for a state, and laugh every day as the ice sheets melt to cover the cesspool with water. can’t happen soon enough for me. no offense to the truly good people living there.
yer welcome at my fire anytime.
I’m done. for now
Schadenfreude abounds in the Gator Nation. F’d developer of “Hannah’s Condiminiums” dropped price from $240K to $190K or was that $180K? See, they dropped price when Summer A started and then they dropped it again. Their mitigation trees (for clearing the property to build this ugly wreck) are dying from lack of watering. I guess Bosshardt (the realtor) sent some guys to mow down the weeds last week. Sad, really sad.
Lazyboy went out of business after 6 months. Oh, nobody could have seen that coming. Except the bus driver.
13th St (SR 441) has empty retail space up and down. I’m not sure why, but with some retail moving to Main St and some going north towards Alachua, the whole corridor is coming down hard. Plus some of the businesses are going out of business. Like those mobile home geniuses. Yeah, there was a bubble in that, too.
Finally today there was an article in the paper about the vacancy rate in rentals in Gainesville. Two years ago it was 1% (this was when they booted people out of their rentals so they could “go condo” and left hundreds scrambling for new digs) and now they estimate 6.5%. The carnage is palpable, especially in undesireable, sprawly, yet boomy SW Gainesville. Dunno if we will actually see ridership go down (less students, everyone moved to Jefferson on 2nd) or if it will just change bus stops (everyone moved into the Enclave).
As for RTS, found out today we are again waiting to see what our funding looks like, with both city and state cutting. We just found out that the ten new hires we thought we were getting won’t be coming after all. Mmm, overtime in the fall. Bleh. Hate it. But I shore ain’t gettin’ paid right now. Gotta make that money. (G’d'm it, I’m going native.)
I’m waiting for some of these idiot developers to actually go bankrupt. Then I will laugh and laugh.
Check out the Grand Preserve at Kanapaha on SW archer. Builder pulled out months ago leaving rows of unfinished “luxury” condos. Just cinder block boxes.
Just got an email from my Bosshardt landlord realtard spouting the ususal “”it’s different in Gainesville” BS. Meanwhile UF is cutting jobs and cutting enrollment by 4K students. Gonna be messy.
“thats what happens when penny-pinching sikh indians run things”
Are these broad generalizations really that necessary?
We have the same downtown “luxury” condo garbage where I live in Raleigh, NC. One bed shoebox condos were starting in the mid $200ks, with 2 beds easily crossing $400k.
The radio commercials for the developments echoed the same smug “live where I play” attitude as Mr. “Too Cool” Atkins.
Enjoy your $263k crapbox.
You forgot to calcualte in the cost of the DUI on I-40 when slogging home from the bar in Chapel Hill.
“Five months after the vote, Florida is still waiting for the sonic boom.”
I have heard the sonic boom twice sense Charlies made this statment. Both were from the shuttle returning to the cape and one covered up by the shuttle sonic boom as it muffled the sonic boom of the housing bubble popping.
I bet a whole bunch of realtors who were dupped by Charlie Christ into believing that the housing mess would correct in such a short period now feel like idiots. That is the price you pay for being stupid and listening to hype!!
http://biz.yahoo.com/rb/080623/usa_housing_harvard_study.html
“Historically, housing markets recover only after the economy has entered a recession and a combination of falling mortgage interest rates and house prices have improved housing affordability,” Nicolas P. Retsinas, director of the Joint Center for Housing Studies at Harvard, said in a statement.
BINGO
The number of homeowners paying more than half of their income on housing surged by 35 percent to 8.8 million in 2006 from 6.5 million five years earlier, according to the study, the center’s 20th annual broad report on U.S. housing trends.
After rising for years, the U.S. homeownership rate fell to 67.8 percent at the end of 2007 from an all-time high 69 percent in 2004.
“As investors demand a higher return for assumed risk and limit credit to riskier borrowers, costs are rising for all types of mortgage, consumer and corporate loans,” the center said in a press release. “Many would-be borrowers are now finding it impossible to get loans at any price.”
Economic weakness does not bode well for income growth in the short run, and housing cost pressures are unlikely to lighten in the long term. Much of employment growth will be in part-time and low-wage positions, the study said.
“The somber conclusion is that if the economy slips into recession or job losses keep racking up, household growth and homeownership demand could fall even more,” the center said in the release.
But in the case of a mild downturn, which most economists expect, the fundamentals of demand are likely to drive a strong rebound in housing once prices bottom out and the economy begins to recover.”
Household formation should expand barring a prolonged period of serious economic decline, the study said. The main risk to that outlook is a drop in immigration from its recent 1.2 million annual pace due to weaker labor markets.
To get home affordability back to 2000 levels, before a five-year record home price and sales surge, “would take some combination of large price declines, interest rate reductions, rent deflation and unprecedented real income growth,” it said.
Tell me again how we get unprecedented real income growth given outsourcing and inflation. It amazes me the have to throw in that if the downturn is mild paragraph. No way we get a rise in housing anytime soon.
“To get home affordability back to 2000 levels, before a five-year record home price and sales surge, “would take some combination of large price declines, interest rate reductions, rent deflation and unprecedented real income growth,” it said.”
WTF?? This just proves how much the “howmuchamonth” financing drove this market. Housing affordability should be determined by incomes and prices, not smoke and mirrors financing.
“‘It’s very hard for people to adjust their mind to the new value of the property. They all have this mind-set, ‘I can afford to keep it for two years and sell it when the market recovers,’” said real estate agent Jackie Moore of Fort Lauderdale. ‘But in the ’70s, it took almost 14 years for real estate to rebound.’”
The realtors and their special interest groups duped the consumer into believing that Florida was running out of land, that property values would always rise and all of the other crap they made up to sell property. The realtors and their special interst groups have lost credibility with the consumers and it will take more than 14 years to build that lost credibility back up.
“But in the 70’s it took RE almost 14 years to rebound”
Yeah, and don’t forget 1925 either! (25 years? I dunno)
I can’t remember the figure, but it was a lot longer than that for some bagholders–way past the war and into the 1960’s or 1970’s, I think.
This would be Miami area, Coral Gables development and so on.
My former house on the North Shore of Staten Island NY was built late 1928 and sold new for $19,000. Then came the depression. House sold several times for $15,000 to $18,000 but didn’t go for more than 19K untill 1963. That is 35 years underwater for the origonal buyer. This was a nice upper middle class neighborhood (Randall Manor) in one of the prime real estate markets in the country–a boat ride to Wall Street.
Nichols said he plans to move there from Buckhead and enjoy the seventh-floor view while waiting for his new home to appreciate.”
“‘And if it doesn’t,’ he said, ‘America is in trouble.’”
Welcome to the real world Paul Nichols. You will soon learn that “America is in trouble” when your one bedroom condo declines in value and you are unable to sell it for what you paid.
Experience is a great teacher Paul and you are about to receive the lesson of your life!
what if it appreciates but only at historical norms like 2-3% ? I’d argue America got in trouble expecting 20% yearly gains.
what if it appreciates but only at historical norms like 2-3% ?
It will be a very long time before condos in the area he bought to start appreciating 2-3%. This guy will lose about $50K or more by the time it is over. The condos in this area were having a tough time selling in the years prior to the boom.
“Gov. Charlie Crist stood before hundreds of Realtors in Orlando last summer and predicted fantastic things about the property tax cuts on the January ballot.”
“To fully benefit, however, homeowners need to be able to sell the home they are leaving.
The tax cuts did nothing for the first time buyer. First time buyers are what keeps the market going. I saw a house listed for 112k I thought I might be able to afford but after going to the tax office website found out it was asessed(sp?) at 240k and taxes would be approximately $4400 a year. So between taxes and insurance I would be looking at 400+ a month. I didnt even look to see if it was an HOA. Until they get these taxes fixed it will keep many 1st time buyers out of the market. The system is flawed with the newest buyers paying the most in taxes.
But most first time buyers aren’t smart enough to calculate the high taxes, just think they are what they are. Now if you could get HBB linked to all college students who Think they want to buy someday…that would be an education.
“Bank analyst Richard Bove of Lutz says the outlook is not good. ‘The impact on banks will be to drive loan losses to levels only experienced in a depression,’ Bove said. ‘The annualized first-quarter 2008 domestic loss numbers are higher than in any year than 1934 already.’”
Just what I have been warning about for months–the depression is already here. Get used to it.
Keep the popcorn popping,
Red Baron
““Bank analyst Richard Bove of Lutz says the outlook is not good. ‘The impact on banks will be to drive loan losses to levels only experienced in a depression,’ Bove said. ‘The annualized first-quarter 2008 domestic loss numbers are higher than in any year than 1934 already.’”
And we’re not at the bottom yet and accounting for the bank losses has lagged the collapse of housing prices. We certainly seem on a pace to equal or exceed some of the most dire numbers of the Great Depression.
Dingell, a Michigan Democrat, said Congress should explore “a full range of options” to limit speculation, including raising margin requirements for financial speculators to 50 percent, preventing pension funds from investing in commodities and prohibiting investment banks from owning energy assets
Yep Pensions shouldn’t have the right to hedge against inflation like wealthy investors. How about limiting the Hedge funds.
Gov of the rich by the rich for the rich.
I still don’t understant how curde prices can stay elevated in the long run without somebody to take delivery at the higher prices and pass the cost along through products. I mean you can speculate in oil, but don’t you have to get somebody to actually receive the physical product? When prices catch up with those who take delivery then demand has to go down… right? At worst, prices remain at the level that end-users are willing to pay.
Isn’t the alternative to just keep creating paper for years, and then switch to going short when the bubble bursts? That, and sloughing off some paper to organizations designed to take the fall.
Pump and dump has gone from a small affair involving the mob to the way the big boys do business. An example of this massive criminality is all the puts and short-selling done in Bear Stearns just before it went down. Nobody honest would have had anything to do with either side of those trades, and no regulatory agency with even 10% honesty would allow way-out-of-the-money puts to be created with those dates.
By TIM EBERLY
The Atlanta Journal-Constitution
This is Ernest’s special assignment — identifying and keeping watch over vacant homes — so he steps past the door that someone has kicked in, pieces of its splintered frame dangling like mistletoe.
Inside, a burglar has smashed holes in bathroom walls and pulled out the sinks to harvest copper pipes.
This is just the beginning, Ernest said. The burglars will be back, and they’ll keep coming back, picking apart the house like vultures. They’re known to pilfer appliances, cabinets, carpet and use homes for drug deals, prostitution or squatting
http://www.ajc.com/business/content/metro/atlanta/stories/2008/06/20/vacant_houses_crime.html
Here is another one for the “You Can’t Make This Stuff Up” files. This was in the Business section of the Chicago Tribune yesterday.
http://www.chicagotribune.com/business/yourmoney/sns-yourmoney-0622marksjarvis,0,624853.story (read the question)
People are smart!
I drove by an RV lot today. There were HUGE banners advertising 20%-40% off and 1,000 free gallons of gas. The lot was packed full and they looked new, too, but admittedly I know nothing about RVs. It was obvious they’re hurtin’, though.
Oops… I should have posted this in the bits section. Sorry, Ben.
totally relevant. Can retired people afford a huge truck, the RV, and the gas to haul it all around without selling their primary residence ?
I never got how anyone could afford it. But that’s just me I guess.
Drive an RV with a boat on top, bikes strapped to the back, and pulling a car. Yup, that’s what want to do this summer.
And why do they need them? Oh yes, they’re entitled. Not picking on retirees. I’m getting there myself.
Crist almighty!
A sonic boom lasts about a fraction of second, and that’s what the guv was pinning his hopes on?
“Gov. Charlie Crist stood before hundreds of Realtors in Orlando last summer and predicted fantastic things about the property tax cuts on the January ballot. ‘Florida’s going to have a sonic boom when this happens,’ he said, using rhetoric he would repeat again and again over the next several months. ”You’re going to be busier than you’ve been in your life. Get ready, get your rest, make sure your license is up to date.”
“Five months after the vote, Florida is still waiting for the sonic boom.”
Around 10,000 banks went BK from 1930 to 1933…
“Bank analyst Richard Bove of Lutz says the outlook is not good. ‘The impact on banks will be to drive loan losses to levels only experienced in a depression,’ Bove said. ‘The annualized first-quarter 2008 domestic loss numbers are higher than in any year than 1934 already.’”
Is there a good reason why you still have your money in a bank, right now?
Quote: “Las Olas Riverfront, built by developer Michael Swerdlow, opened about 10 years ago. But the complex couldn’t sustain its early success.”
I remember going to Riverfront a few times back in 1998 and 1999. It was always jammed pack. I didn’t know it was brand new back then.
I thought it was a long standing Ft. Lauderdale fixture. So when my family visited me this spring, I took them to Riverfront expecting it to be the happening, party place it was last time I went. Riverfront was nice and clean, and the restaurant we went to was good, but it was almost deserted.
Even at night, there were just a few crowded bars, but nothing compared to the hundreds of people in the street that I remember.
What happened? Did everyone just go to Riverfront in 1998-1999 because it was brand new? It’s not like Riverfront look like a dump now; it’s still pretty. It just looks smaller without all the people, though.
Quote: “‘And if it doesn’t,’ he said, ‘America is in trouble.’”
And if it doesn’t, you’re in trouble. America will do just fine.