The Beginning Of A Monumental Real Estate Collapse
The Herald Tribune reports from Florida. “David and Heather Hash are like many who bought homes at the height of the housing boom: Now, looking to sell, they find they owe more than their house is worth. Their three-bedroom, two-bath house, which they bought in 2004 for $337,000, has been on the market for eight months — now listed at $325,000 — without a single offer.”
“‘We’ve had a lot of heart-to-heart talks with our Realtor, who has checked with other Realtors to make sure it’s priced right,’ David Hash said. ‘The house is in good shape, but with the inventory out there, we’re not getting anyone coming through.’”
“They are not headed for foreclosure. They are not even behind on their payments. They have a second child on the way and had wanted to move. To Hash, it feels like financial options for homeowners in trouble are the most abundant for those who have behaved the least responsibly.’
“‘What’s frustrating for me is the people getting the help are the high-risk borrowers and lenders who knew what they were getting themselves into,’ he said. ”And now they are going to pretty much get bailed out.”
“Joe Murphy, a Coldwell Banker Residential Real Estate agent, says he is ‘neck deep’ in short sales in Manatee County. ‘It seems like everything we show right now are short sales or foreclosures,’ Murphy said. ‘Short sales have been getting better and easier to deal with in recent months as the lenders have been more cooperative.’”
“‘A year ago I would dissuade someone upside-down in their house without a real hardship from a short sale,’ he said. ‘Now all bets are off.’”
“Murphy recounted a recent successful short sale in which the seller was not behind in payments and had investments that could have been liquidated to pay the difference, yet the bank still wrote off $100,000 when the property sold.”
“‘The banks don’t want the houses back,’ he said.”
“Mary Kleiss missed a mortgage payment for the first time in her life in June. Now she has missed July’s, and expects to soon lose the house she has lived in for 30 years.”
“The death of her husband two years ago started a chain of events that pushed Kleiss into a financial crisis. It culminated with the loss of her job in February, just before she saw a spike in her flood insurance.”
“‘I’m heartbroken to walk away from this home; I see the plants that Joe and I put in in 1991,’ Kleiss said. ‘Whatever Joe did I would like to take with me. Not the new stuff, the memories.’”
“Kleiss is among a growing number of traditionally self-sufficient people plunged into a new world by the steep economic downturn. They are skipping their mortgage payments, standing in line at food banks and reaching out to social service agencies for emergency aid.”
“The house will not fall into foreclosure until she misses four payments, something she cannot imagine avoiding, even with assistance. So, she is planning now to move into an apartment complex where the rent will be cheaper than a mortgage.”
“‘I’ll just walk away. I have no choice,’ Kleiss said.”
From The Ledger. “Polk County has never seen this many foreclosures, at least not in recent memory. In June, 815 foreclosures were filed with the Clerk of Courts, up 114 percent from the year prior and the highest monthly sum in county records dating to 2002.”
“The filings - primarily residential but also commercial properties and land parcels - totaled nearly 4,500 through the first six months of the year. Polk had roughly 5,100 in all of 2007.”
“‘This is not just sub-prime people, people with bad credit. Foreclosures are hitting people within all income brackets,” said Janet Folkerts, financial counselor. ‘They’re not all deadbeats. They’re people living the American lifestyle to the extent of their paycheck. It didn’t take much for them to go under. When I have people in my office that have over $10,000 a month in income and can’t make it, that tells you something.’”
“Tallahassee-based nonprofit group Florida Legal Services says there are now some 77,000 homeowners in foreclosure, second only to California.”
“‘The increase is shocking,’ said John Corbett, president and CEO of Winter Haven-based CenterState Bank. ‘It’s a six- to eight-month process from when foreclosures are filed to when the bank can take possession. What that tells you is a wave of homes are probably going to come on the market in the fourth quarter of this year and the first quarter of next year, and that’s going to continue to put downward pressure on prices.’”
“Corbett attributes the tide of foreclosures largely to investors bailing out as median home values continue to plunge.”
“‘Having said that, with depreciating home values and increasing fuel costs - which affect everybody - there will be a squeeze that we have not experienced for the past decade. People have been living off the equity of their homes as part of their lifestyle, and that extra cushion has gone away,’ he said.”
The Orlando Sentinel. “With mortgage foreclosures still on the rise across Florida, downward pressure on home prices is expected to continue at least through the end of this year and possibly much of 2009.”
RealtyTrac said Thursday that 40,351 residential properties in Florida were foreclosed on by lenders in June — second only to California, which had nearly 67,000 filings. Florida’s foreclosure total was nearly double the volume of a year ago.”
“Real-estate professionals in the Orlando area contend that both single-family home and condominium sales are healthier locally than many people think.”
“‘My father and I have real-estate projects all over Central Florida. My cousins and uncle have real-estate developments in South Florida. My projects in the south Eola district of Orlando are the strongest in the entire portfolio,’ said Orlando-based condo developer Steve Kodsi. ‘In fact, if we only had the Sanctuary and Star Tower [condominiums], we’d be having a profitable 2008.’”
From Canadian Business. “Attention, real estate shoppers: the entire U.S. sunbelt is now officially on sale. Prices in many areas of Florida, Arizona, Nevada and California have dropped 40% from their peaks of a couple of years ago, to the point where the deals seem nearly too good to be true.”
“In Naples, Fla., a three-bedroom, two-bathroom home that sold for $350,000 in 2007 is on the market for only $200,000. A starter home in Sacramento, Calif., that sold for $215,000 in 2004, is on offer for a mere $129,000. And remember: these aren’t sale prices. They’re asking prices.”
“Sandra and Pat Parente of Richmond Hill, Ont., scouted condos in Fort Lauderdale, Fla., in March of this year. Their eyes lit up when they saw a handsome two-bedroom, two-bathroom unit only steps from the beach. It had been listed this past October for $239,000, but had since been reduced to $199,000.”
“‘My immediate thought was, ‘Wow, this is fantastic,’ says Sandra. ‘It needed a bit of sprucing up, but there wasn’t anything that needed urgent attention. It had a green area all around it, and a pool, and we saw it as a great way to get into the Florida market.’”
“The Parentes’ wariness is justified, say real estate experts. Many believe we’ve seen just the beginning of a monumental real estate collapse.”
“‘The size of the U.S. real estate bust on the way down will be proportional to the size of the real estate boom on the way up,’ says Robert Campbell, a real estate economist in San Diego, Calif. ‘There’s no slowing down this train. The areas that had the biggest booms will have the biggest bust. Prices are heading lower - way lower.’”
“‘Believe me, the real estate community is biased and will encourage you to buy, even as prices keep falling,’ says Campbell. ‘You have to avoid that.’”
“In the Miami-Fort Lauderdale area, the supply of single-family homes and condominiums for sale is enough to last for 34 months. The backlog is 21 months in Orlando, 18 months in Tampa and Las Vegas, and 14 months in Phoenix. Meanwhile, even more units are coming on the market as builders finish the projects they started in better times.”
“‘Builders are offering huge incentives and lease-back programs,’ says Mark Dziedzic, president of a real estate firm that specializes in helping Canadians buy second homes in Arizona. ‘Here in Arizona, some will guarantee you rent of $1,500 a month for two years on any property you buy, while others offer huge discounts on sale prices. The competition is tremendous.’”
“‘I know Canadians will be saying to themselves ‘look what we pay here in Canada’ and compare it to what they can get in the U.S.,’ says Campbell. ‘But don’t look at prices relative to where you are. Instead, look at prices relative to where the real estate market is in the U.S.’”
“Ann Bosley recently bid on an 1,800-sq.-ft. condominium in Hilton Head, S.C., that comes with maintenance and security included.”
“Bosley says her search for a U.S. property taught her never to think that any offer is too low. ‘Nobody is bidding the asking price on any property right now,’ says Bosley. ‘In fact, U.S. real estate agents are advising clients to bid 20% under the asking price, then take off extra for necessary reno costs.’”
“Canadians Sandra and Pat Parente, have put off buying a U.S. property. In April, the Parentes received a phone call from their Florida real estate agent informing them that the seller of the condo in Florida had reconsidered and would accept their $175,000 offer if they wanted to resubmit it. The couple chose not to.”
“‘We’ve reconsidered as well,’ says Sandra. ‘I’m reading every day about more foreclosures happening in the next few months and I think we need to do more research on taxes and rental issues. When we finally buy - which we’d love to do eventually - it will be with our eyes wide open.’”
’she is planning now to move into an apartment complex where the rent will be cheaper than a mortgage. ‘I’ll just walk away. I have no choice,’ Kleiss said.’
I don’t get the continued boo-hoo on this stuff. This lady is in a tough spot; she is going to save money renting (like just about everybody). This is exactly what she needs to do - lower her expenses. I say walk away and don’t look back.
We made it so easy for people to walk away from debt, and there’s no moral stigma about bankruptcy being a scarlet letter, like it was in the 50’s or 60’s, so…
Why wouldn’t they walk?
They might miss the rebound. Realtors say it’s already starting to turn around. They dont want to just give it away to the bank. Why should the Banks make all the money over the next year?
Don’t forget that the our elite overlords are now obvious reprobates. It’s hard to maintain any kind of stigma when looking at them.
Joe, 22 years older than Mary, fell ill with cancer in 1990, forcing the couple to refinance the home to pay for medical bills. He later became homebound in 2004 and died two years later.
After resorting to credit cards to pay her husband’s medical bills and funeral costs, she became bogged down in debt. For months, she kept up with the credit card payments, using her Social Security income and working part time at a medical office.
So they refinanced to pay the medical bills. And she used credit cards to pay medical bills. Isn’t it at all possible to not refinance nor turn to credit cards for catastrophic illness? How about working with the hospital / doctors on payment plans?
So they refinanced to pay the medical bills. And she used credit cards to pay medical bills. Isn’t it at all possible to not refinance nor turn to credit cards for catastrophic illness? How about working with the hospital / doctors on payment plans?
Have you ever try to work with the hospitals/doctors? More hard core bunch is not easy to find. I think in Florida you can be put to jail for unpaid medical bills.
Have you ever try to work with the hospitals/doctors? More hard core bunch is not easy to find. I think in Florida you can be put to jail for unpaid medical bills.
I call bullsh*t. Hospitals/doctors are always willing to accept a payment plan or or even a sliding scale based on the patient’s ability to pay.
The problem is that too many people feel they are entitled to free medical care for the same reasons they are entitled to paying extremely low taxes: They’d rather spend their money on hummers and Hawaiian vacations.
You are correct. It is possible to not ‘refinance’.
She may have been forced to sign a “I will give you everything I own” note to get the treatments, but if not, FLORIDA is a Homestead State.
NEVER refinance you home for personal expenses.
No one can put your house in foreclosure except for 2 specific reasons: 1)non-payment of property tax, 2) non-payment of mortgage.
If she lived there for 30 years, the house should have been owned free and clear. It was a foolish decision to mortgage the house for bills.
She should have paid as much as possible with other debt instruments, and then simply filed for bankruptcy to settle outstanding debts if she could not make the payments. The writer’s comments:
“Kleiss is among a growing number of traditionally self-sufficient people plunged into a new world by the steep economic downturn.”…………are just plain stupid.
She got in trouble with medical bills and took the wrong approach to settle them.
In this State, personal debt can be attached to the house as a LIEN that will be settled when the house is sold. It cannot be used as a basis for foreclosure. She could have lived there for taxes and insurance until the day she died, assuming they had paid the house off, then the bills would have been settled. Bad decision making, and probably bad legal advice.
Of course, I am assuming they didn’t have a mortgage after 30 years. They may have been more deeply indebted, so that there was an existing mortgage that could not be paid on current income, therefore pushing a “refinance”. If so, too bad.
Don’t know about Fla but here I know the hospital billers will call and harass and say can’t you get a home equity loan, can’t you borrow from family etc. I can imagine someone is the middle of chemo or intensive care, or their spouse, would wonder at the quality of care if they told the billers to shove it. I mean, even if nothing really changed you would always wonder.
No one can put your house in foreclosure except for 2 specific reasons: 1)non-payment of property tax, 2) non-payment of mortgage.
They can also foreclose on your house for non payment of HOA fees and non payment of federal taxes and in some states non payment of state income taxes. Your home can be seized if you commited mortgage fraud or illegal drug trafficing.
The way I look at this: If the Feds can declare eminent domain and seize your house for whatever reason, then all bets are off.
I predict considerable action by the Feds to seize entire neighborhoods in this manner as an appropriate means to “save” neighborhoods decimated by foreclosures.
I believe IRS tax liens also trump Florida’s homestead exemption laws.
I don’t get the continued boo-hoo on this stuff.
That’s the whole point…the emotional attachment these folks have with their homes. The psychology of homeownership in this country has evolved into the raison d’être of our entire existence.
The decision to own a home never had anything to do with having sound finances, and why the media and politicians would rather focus on tears than on financial common sense…they are the same ones who encouraged everyone to buy the most expensive home they could ‘afford’ to begin with.
> ‘They’re not all deadbeats.
If you have your house foreclosed, you’re a deadbeat.
debtbeat
What a cool new word…
I’m not a big one for boo-hoo stories, but to me a lot of the comments about Kleiss seem cold or even mean. Clearly they made the wrong choices in financing her late husband’s medical care, but it was a tough time. He dealt with cancer for 16 years, homebound for two years at the end. They were faced with horrendous bills at the same time that he was dealing with the physical challenges of cancer and its treatments and she was dealing with care-taking.
The twenty-two year older WWII vet husband may have handled all the financial decision making until he got too sick. I don’t know, but it wouldn’t be surprising given his generation and the age difference. So they made serious financial mistakes while he was trying to stay alive and she was doing what she could to help him (without her, he would have spent his last two years in a VA hospital.)
She is losing her home because of the debt for the medical bills and the rise in her flood insurance. She is sad to be leaving her home because of things like the plants that she and her husband planted together in 91 (the first year after his cancer appeared) and other things that she associates with their life together.
She’s not whining about granite countertops or a $50,000 outdoor kitchen or a “dream home” McMansion. I think it is sad that she will not be able to stay in her home.
What’s sad is that her husband - who she obviously loved - had cancer and died.
They chose to use the house to prolong his life, because - to them - he was worth more than the house.
She shouldn’t complain at all about losing the house. She should be grateful she had the house to use to pay for extending her husband’s life.
You miss the point. While medical problems suck, and I know because I have them myself, those that financed medical bills with HELOCs had access to credit lines renters did not. While we can all feel bad for those that suffer from health problems, let’s not confuse it with the housing bubble. Don’t let those with political agendas throw in a death or disability case to confuse the real issues. Such stories upset some posters because the victim of the day is being used as nothing more than pawn in a more devious political game.
I hadn’t thought about it that way Cris. Good point, also made by Mike.
Mike, I don’t care much for the sob story stuff in general and disagree with the agenda behind it. If “the point” here is that sad cases are used to promote a devious political agenda here, I guess I did miss it - distracted by the story itself.
In most of the mortgage human interest stories about the “victims of the housing crisis,” the “victims” seem greedy or stupid or foolish, poor planners, or simply like they made a gamble that didn’t work out for them, and seem to have defined themselves and their lives and their imagined prosperity by a big box of air stuffed with a bunch of junk. Even when the stories include cases of loss of job, illness, disability, the “victims” seem to have been vulnerable because they overextended themselves for a bunch of “stuff” without providing themselves a safety net.
I guess in this case the writer managed effectively to “push my buttons” by selecting a source (I didn’t read Kleiss as a victim) and story that probably managed to push a lot of people’s buttons.
“The psychology of homeownership in this country has evolved into the raison d’être of our entire existence.”
Spot on. If my late 80’s parents are any indication, we’re in trouble. I begged them to sell their shack and downsize for 3 years now. “We can’t bring ourselves to do it”. “What will we do?” “Where will we go?”. “We love this place”. They had a chance to offload their monstrosity at a price they will never see again in their lifetime and maybe even mine. Clearly their shelter is a source of self-esteem, albeit a very warped one.
This business with the elderly staying in their homes for years and years too long is something that really grinds my gears…it’s selfish of them to do so and very hard on their children. More than likely they did NOT have very elderly parents (people died so much younger) and they have no experience with trying to reason with much older people. The house goes downhill fast and they have needless anxiety and worry…when my Mom (already a widow) hit 75 we (her 4 kids) sat her down and said “get out of this house’…and of course she didn’t want to but we pretty much forced her to…now 5 years later she is well cared for in a continuing care facility and she now claims it was all her idea to move out of the big house and downsize into something safer and less expensive..get those old people out before you have a crisis on your hands
“‘This is not just sub-prime people, people with bad credit. Foreclosures are hitting people within all income brackets,” said Janet Folkerts, financial counselor. ‘They’re not all deadbeats. They’re people living the American lifestyle to the extent of their paycheck. It didn’t take much for them to go under. When I have people in my office that have over $10,000 a month in income and can’t make it, that tells you something.’
The poor Fbs and GFs aren’t the Deadbeats.
The poorRE agents aren’t the Deadbeats.
The poor Bankers aren’t the Deadbeats
The poor Wall St. gang aren’t the Deadbeats
The poor US Governent reg people aren’t the Deadbeats.
Bush and Cheney aren’t the Deadbeats.
There are No Deadbeats HERE Mr Senator!
They WERE ALL Victims of Circumstances and the vast Left Wing Conspiracy of rich working Taxpayers, Potential Buyers(where ever they are hiding) and those evildoer frugal Saviors.
Find, Fine and Penalize THEM ALL… MAKE Those Deadbeats PAY Mr. Senator
I just love double-speak, don’t you? Yesterday I read about some police official talking about a recent outbreak of grafitti in the Davis Islands area of Tampa. He determined that it wasn’t gang-related, just kids with “misplaced expressions”, LMAO!
“They’re people living the American lifestyle to the extent of their paycheck.”
ay, there’s the rub
The banks have already written down the value of the mortgage-backed securities. By walking away she is simply affirming this truth, and doing exactly what the financial boffins expect.
she’s been in the house 30 years - how could she be near foreclosure? Why don’t they tell the whole story.
“Joe Murphy, a Coldwell Banker Residential Real Estate agent, says he is ‘neck deep’ in short sales in Manatee/Guillotine County.”
Their three-bedroom, two-bath house, which they bought in 2004 for $337,000, has been on the market for eight months — now listed at $325,000 — without a single offer.”
“They are not headed for foreclosure. They are not even behind on their payments. They have a second child on the way and had wanted to move.”
Here’s an option - just stay where you are. 2 parents + 2 children = 3 bedrooms seems okay to me.
“‘We’ve had a lot of heart-to-heart talks with our Realtor, who has checked with other Realtors to make sure it’s priced right,’ David Hash said.
Are you asking the same people who priced it for you when you bought it? The same ones who told you that you better hurry up and buy because the prices were going up 20-30% next year, that it was a “bargain” at that price and……………..drumroll, please…………………..
“if you don’t buy NOW, you’ll be priced out forever!”.
Those are the people who’s advice you are seeking??
Realtors(r) have hearts?
These people are being painted as some sort of innocent victims. They bought at the height of the bubble and while they may be current on their payments, it doesn’t sound to me that they put much skin in the game. Otherwise, they would be able to and would reduce the price more than 3.6 % over eight months. Just a typical example of the greed that created this whole thing.
Are you asking the same people who priced it for you when you bought it? The same ones who told you that you better hurry up and buy because the prices were going up 20-30% next year….
Testify! The same fools who based their buying decision on “Suzanne’s research” now turn to the same discredited and utterly unscrupulous source - an NAR shill - for more “advice.” Somehow their claim to victim status doesn’t ring true.
Those are the people who’s advice you are seeking??
They are the same realtors who lack a formal education let alone a degree in finance or accounting, yet provide this advice just because they have a realtors license.
Look at the education required to get a realtors license and ask yourself, Would you trust the advice of this person who only has a high school education versus a well educated and experienced professional with financial experience?
The realtor only has one thing on their minds and that is to collect the commision at your expense, nothing more!
Hold on Fuzzy, All these wall streeters, economists and banksters have higher ed. Education has nothing to do with this…
Education has nothing to do with this…
Only from the realtors aspect. The others lack ethics and were tainted by greed or fear they would lose their jobs if they did not participate in the fraud.
You’ll know when it’s priced right when people start
walking in the door and then start making offers.
I’ve seen this more than once. You need to leap in
front of the declining curve, not wait it out.
This applies if you HAVE to sell of course.
Mike
“Here’s an option - just stay where you are. 2 parents + 2 children = 3 bedrooms seems okay to me.”
The full story says that they want to move back to Albany, NY. I’d love to talk to them about their Florida experience.
I’ll say it again. FL is not a place for kids; period. Having a family in much of coastal FL is exceedingly expensive, and frankly, not good for the kids. Even if you’re weathly, the kids are going to be in school with people who have no respect for money, values, culture, etc. I have never seen anything like the schools in FL; girls running around in bikini tops asking guys on the street to see their condos (no, I’m not kidding).
Trust me, coastal FL is for the adult sect only; and really not even the gray hairs anymore (the traffic is insane, and the pace of life compares to any big city).
There’s a totally different culture in FL, which, until you live here for a period of time, you just won’t understand. It’s not a culture that you want you’re kids exposed to; let’s put it that way.
I wonder how many billboards they have in Albany advertising escort services? Or even breast enhancement/penile enlargement?
there is a couple billboards advertising strip clubs in Albany’s down town
you can rent a nice apartment in a brownstone, in the best part of city for less then $800
also you can buy whole building with 3-5 units in them in decent hoods, for less then $300k
B-b-b-but Florida is warm! If you and ten gazillion other people can’t be yourselves and act like fools in the land of eternal sunshine, how is life worth living?
Say what you want, but in cooler parts of the Eastern US, some will be praying they COULD move to Fla this winter. As Bill in Carolina has observed, it takes less energy to cool a house than heat one.
“…it takes less energy to cool a house than heat one”
Now that oil speculators have driven up the cost of oil, I’m sure that’s true…but not in normal times.
Is there a link proving that it is more expensive to heat a well insulated home than to cool a well ventilated one? I would prefer an actual link to research than a vague reference from another poster.
By the way, what does he think about the cost of water in the warm states vs. the cost of water everywhere else? I bet it more than offsets any cost difference between heating and air conditioning.
Welll.. Last I read, water rates in Buffalo are much higher than those in Arizona… Arizona’s in a drought, and Buffalo is near 2 of the great frickin lakes…
Corrupt NY Tammany gummint ftw!!!
What high schools are you talking about? My daughter goes to high school in Sarasota and I sure don’t see girls in bikini tops with boob jobs….They have dress codes. Straps to your tops need to be at least three inches…..
Moving from Charlotte, nc the most materialistic place I’ve ever lived, I found it a breath of fresh air that my daughter didn’t have to go to Hollister and Abercrombie for her clothes. Bealls and Aeropostale are the norm here.
We enjoy raising our children here. Boating, aquariums, beach, Busch Gardens, biking and swimming all year round….. I have found no difference in the teenagers here as opposed to the teenagers in North Carolina. There are a few more gothic kids from NY, but other than that they are the same.
The only bad thing with this area is all the yankees that moved down and blowing up a big old bubble that has hurt everyone.
Exactly, total overgeneralizing. We travel all over the US and the well raised kids and poorly raised kids are everywhere. You raise your kids, don’t let TV or the area raise them. I have seen some terrible kids in NY and some amazing kids in coastal Florida.
Their three-bedroom, two-bath house, which they bought in 2004 for $337,000.
It looks like they are upside down by at least $100K or more.
Remember, kids are super-sized theses days, you just can’t shoe horn them into ample bedrooms anymore. They need a suite. Share a bathroom, are you kidding? And mom & dad, with their walk-in closet the size of a NYC studio, can’t imagine squeezing a home office into their MBR. It would ruin the feng shui they so carefully plotted. Dream homes are shrines to HGTV taste and conspicuous consumption, not a place people can actually afford to live in.
The landlord is trying to do a short sale. Original price is $625,000 for a three bedroom two bath and a two bedroom one bath on one lot. There is nothing special about these houses, just something a local builder who does cookie cutter, all the same look, put up. Present recently adjusted asking price is $429,500. This is in the California foothills north of Fresno 40 miles. He is not behind on the payments. I wonder if he can sell it. Recently a three bedroom two bath in good shape went for $185,000 at auction that was originally built by the same firm as these two here.
I would be careful, if I were you. Your LL sounds like she/he may be in trouble (of sorts).
If you intend to stay in his rental, please do a monthly check for that address re a NOD at the County Clerk-Recorder’s office either online or in person (more current info available in person). On the page below, on the drop-down menu under “Recorded Documents”, select NTCDFLT for your search and the most current date:
http://www.criis.com/fresno/srecord_current.shtml
All the best to you.
~Misstrial
Thank you Misstrial.
I’m a happy renter but you are a law gem.
You helped me along with others when I was agitated.
“‘A year ago I would dissuade someone upside-down in their house without a real hardship from a short sale,’ he said. ‘Now all bets are off.’”
A year ago this realtor was drunk from drinking the kool-aid provided by the NAR that now is a great time to buy. Now that the effects of the kool-aid is wearing off, he is now regaining realization that there really are problems with selling overpriced property. Perhaps the lack of home sales is also having a significant impact on the realtors bottom line and now he is grappling for the short sales.
“When I have people in my office that have over $10,000 a month in income and can’t make it, that tells you something.’”
Yes, it does. They are clearly overly-indebted. They probably took the advice of a Realtor ™ and bought the most expensive house the could finance (not afford).
This was to be the key to their success. Good work, guys.
If I had $10,000 a month, I would have a lot of cash stashed somewhere.
“Murphy recounted a recent successful short sale in which the seller was not behind in payments and had investments that could have been liquidated to pay the difference, yet the bank still wrote off $100,000 when the property sold.”
O.k., this pisses me off.
Actually, this pissed me off about the same as the short sale in general. Why should someone who actually has some savings be penalized where the total indigent (read, most people) are let slide.
Frankly, I think that every one should AT LEAST have to pay tax on the short sale amount (no BK to get away from), and, without BK should have to pay a significant portion back to the bank. However, as the rules stand, I’m no more pissed off by the guy walking and keeping his assets, it would be less fair (imho) to take his assets, but then let the guy with 100K in CC debt (and no cash/investments) just get a walk on the house.
I guess a good analogy would be the woman who, while I was stopped at a red light, hit my car causing $1200 in damage, had no insurance or driver’s license, and didn’t speak English. I asked that she pay me whatever she could, “even if it’s only $10 a month.”
I never heard from the bit$h again.
I didn’t bother pursuing it - because she had no assets to pursue.
I guess if tomorrow my car is totalled by Donald Trump, I should just let it slide…
I had a guy cut in front of me in heavy traffic once on US 1 near SW 17th Ave. in Miami and damage my front end and knock out a headlight - a couple hundred dollars damage on a well-used Dodge Van. I chased him down, yelled at him in Spanish for being a pendejo, and, quickly gauging the situation (this was City of Miami, the guy obviously had no insurance, I had Va. tags, etc.), just demanded, “Dame cien dolares.” It was a Friday afternoon, and sure enough, he peeled off five 20s and gave them to me, no argument. My girlfriend at the time, who speaks Spanish better than I do, was impressed, and I have to admit it was the best move available to me.
Good idea! I’ll use it ‘next time’!!!
Don’t get me started. I’ve been hit THREE times in 16 months while stopped at a light. All three were talking on their cell phones when they rear-ended me.
I now have a crowbar in my car, and am starting to think that something more awe-inspiring (yet totally legal) is in order. These assholes (women and men alike) who think it’s perfectly fine to run their 2-ton+ weapon into my car might require an ice pick through their foot. I AM SICK AND TIRED OF ASSHOLES WHO USE CELL PHONES WHEN DRIVING. You run into me again and you’re gonna pay. Big time.
Of course, Chicago police are only interested in setting road blocks and ticketing those who don’t use seatbelts. But stop someone else from running into other cars due to cell phone use? Nah.
If it was a nonrecourse loan, what is there to be pissed about? Not having to pony up was part of the contract.
If it was a recourse loan and the bank didn’t check for other assets to make up the difference, then the share holders of the bank should be pissed unless the bank could show that the time and costs of foreclosure would exceed any amount they could get by selling it as a foreclosure. I think it just sounds like the banks have figured out that the market isn’t coming back any time soon and that the prices of short sales are the market price.
It also suggests the banks are in way over their heads. So far they’ve had the ability to be sloppy and slow - but that time looks to ending fast.
“I have tons of money, I entered a binding contract to pay a debt, screw my note holder, I’m not paying.”
This is just another form of theft, they knew exactly what they were getting into. Hell has a place for there people.
Murphy was a slime ball on the way up. He’s even slimier on the way down! Idiot lives in over a million dollar home. Four years ago he lived in a $300k home. He’s gotta do what he’s gotta do to keep the cars and house.
‘In fact, if we only had the Sanctuary and Star Tower [condominiums], we’d be having a profitable 2008.’”
If pigs had wings………………..
‘In fact, if we only had the Sanctuary and Star Tower [condominiums], we’d be having a profitable 2008.’”
If I only had bigger boobs, I would be Playmate of the Month.
When I have people in my office that have over $10,000 a month in income and can’t make it, that tells you something.’”
It also tells me something like:
1. They did not live below their means.
2. Lacked the ability to save or save for the rainy day.
3. They were too busy keeping up with the Jones and living the luxury life without the means to support it if they lost their job.
4. Thought their job would last forever, but never planned for the future or the day they lost that job.
5. Failed to budget properly.
Is that 10K in income, or 10K take home?
Either way, that’s a min of 120K a year, and could be as much as almost 200K a year in income. That’s quite a bit of money. However, from my own experience, I know that the qualifications were about 10X income at the highest of the bubble, so if this guy bought a 1-2M dollar home, then it makes perfect sense.
My jaw dropped when my RE agent (who I was using to rent) came back with my qualification paperwork several years ago. Just about 10X my income is what they told me I could afford (actually 10X my HH income, which is even worse). As soon as I saw that number, I immediately understood what was going on around me.
Anyone know why Manatee county mls is gone? I have been keeping track of price drops through their mls and the last four days it isn’t available anymore????
I make over 120k per year just base salary at 33. In 2006 I bought a sub 200k 3700sqt home from a very distressed builder - thats under $55 per square foot in Frisco, TX.
Many more jobs continue to exist in this area for senior technology executives and very highly skilled software gurus. I see no reason to be concerned as my 6% fixed mortgage is well within my means. Where is the problem in here? Oh thats right .. this blog doesn’t deal in the positive. I have a nice big house for pretty cheap to my mind. Couldn’t care about $10 gas as I mostly work from home.. Welcome to the new age fools.
There are some on this blog that make 10x + what you make.
So what?
What’s the point?
“Real-estate professionals in the Orlando area contend that both single-family home and condominium sales are healthier locally than many people think.”
Sales contracts always look good until the true numbers that reflect actual financed and closed sales appear. More realtor BS to fool the public into believing that sales are fine.
Any Hash House Harriers (H3) out there?
“David and Heather Hash are like many who bought homes at the height of the housing boom: Now, looking to sell, they find they owe more than their house is worth. Their three-bedroom, two-bath house, which they bought in 2004 for $337,000, has been on the market for eight months — now listed at $325,000 — without a single offer.”
H4 (Highest Hash House Harriers) Sana’a
Also H3 Muscat, H3 Salalah
On! On!
To the unenlightened, H3 is a drinking club, with a running problem.
on, on
I can’t believe there aren’t other Hashers out there. Any Hasher HBB lurkers? On on!
Canadians going down to the US and say “Wow! Things are so cheap down here” should instead ask the question “Why is real estate so expensive in Canada?” That’s the 64,000$ question…
Why is real estate so expensive in Canada?”
Because they’re not making any more land, and everyone wants to live there…same propaganda holds true everywhere.
Except for a few small areas real estate is not expensive in Cabada, it is damned cheap. The problem is that about 70% of the population wants to live in about 1% of the country, the areas close to the downtown of major and semi-major cities. Yeah, we preserved our cities while next door they trashed them. Now the older city centers are where eveyone wants to be. Beyond that there are lots of places about 100 miles from Toronto or Vancouver or Ottawa where very nice homes can be bought at very good prices. Of course, that’s not “where it’s at”. So you pay for location, location, location.
Went out yesterday to the Harbour Isles development in Ruskin because I got an email from KB for a $25 gas card and ‘free’ prizes. It has also been mentioned in the SP Times as an area turning around and I wanted to see for myself. Anyway, KB has gone back to their roots….starter homes at $140K with not a lot of amenities. The sheeple were out and my salesman had told me they had sold 35 homes in the last two months. Of course, before I went out, I checked the Hillsborough clerks website and saw that KB had sold only 9 homes since January in this development. Needless to say, his jaw dropped and he began mumbling about, “yeah, a contract isn’t a closing”, etc. I nearly had him crying as I described the current economic climate and that 3/4 of the people that were walking around in the house couldn’t qualify for a loan in today’s environment. He just nodded his head……..
At least your RE guy was acknowledging reality. Our RE people in Anchorage still think the Californians, oil millionaires, retirees, etc. will show up like cavalry at the last minute to rescue our housing market, because obviously it’s different here.
When I say “If the Californians/retirees/oil millionaires can’t sell or hold on to their homes in California, what on earth makes you think they’ll be buying up here?”…that’s when I get the stinkeye.
But before this happens all the foreigners from China and Europe are going to flock into CA to buy up all this overpriced real estate!!
Great story, Soldier. I pass Harbour Isles frequently. Ever since they started developing they’ve had sign spinners out there at various times, flagging down the people driving on 41. Didja see some of the weedy lots? And I find it interesting that although the price of the KB homes are cheaper, there are some Troll houses in there for half a mill on up. I don’t know what the SP Times meant about “an area turning around”, though. I mean, it’s a fairly new development, although it did stall out for a while, so maybe they mean those nine sales.
Oh, also, you can enjoy the not-so-distant view of the Tampa Electric belching stacks from any one of those lovely homes at Harbour Isles. Cougha-cougha.
I’ll say it again, if you must buy, avoid like the plague buying in a HOA or condo in Florida at this time. It’s gonna get even uglier than it is now and I’m betting that a lot of newer HOAs are gonna get some nasty surprises down the road, like having to pay for things the developer was supposed to do, and environmental and structural problems. Can you say “stinkhole”?
a lot of newer HOAs are gonna get some nasty surprises down the road.
I just did some work this past week advising a local established HOA who is experiencing a significant drop in revenue due to a large rise in forclosures. A large majority of HOA’s in the Tampa Bay area are having financial problems right now due to the housing mess.
As for the devlopers walking away from their obligations to the community, look no further than Heritage Harbour. This community was sold as a gated community. The problem is that the statues for Hillsborough county do not permit gated areas that are using public roads. Therefore, the Heritage Harbour community must leave their gates open to the public. The statue has been on the books long before the developer broke ground.
“yeah, a contract isn’t a closing”
Great post Soldier Renter!
Most of the public does not understand that the realtors are biased and will only post numbers of sales in contracts, but they will never tell the truth regarding actual sales financed and closed because the numbers are so low.
Next time, ask the realtor to put it in writing in your offer that they had 35 closed sales in the last two months and see if they commit fraud.
By the way, your posts on the sptimes blog site have been excellent and to the point which is showing the public that the realtors have been incorrect.
“and expects to soon lose the house she has lived in for 30 years.”
Your home should be paid off after 30 yrs. I have no sympathy for you.
“‘We’ve had a lot of heart-to-heart talks with our Realtor, who has checked with other Realtors to make sure it’s priced right,’ David Hash said. ”
Hey, David, here’s a hint that will save you from wasting more time on those heart-to-heart talks—if you’re not getting any offers, it’s not priced right!
..
Looks like Polk County is finally getting the bum rap that it deserves. I have been posting on this blog for 3 years about the situation here..
I knew the gig was up about 3 years ago when I saw immigrant workers getting 200K No Doc loans for houses over in Poinciana; and also when young white twentysomething unmarried couples were buying 500K lakefront homes in Winter Haven with No Money Down.
There are approximately 1 in 8 homes for sale on some of the streets in the more established neighboorhood where I live ( Interlachen - North Lake Howard ). Out in the county and south of Winter Haven is a nightmarish ghost town of flipper lotto-houses languishing in the humid Florida sun. Recently the Polk Sheriffs Office started a new Task Force to deal with daytime burglaries and house strippings in far-flung subdivisions. Unemployed meth tweakers are returning to thieve in the subdivisions they built a couple of years ago.
I have been living in Winter Haven for the last 20+ years and this mess is right outside my doorstep.
Median Income individual here is around 32K; household is around 45K. Reality hasn’t quite set in; as there are trailers out there listed for 150K. Decent housing can be found in borderline neighboorhoods for around 200-250K. These were 90-100K houses just ten years ago.
They built thousands of unnoccupied houses here on cow pastures and 50-year floodplains.
I am a renter of more modest means, but hope to buy some improved land to build a energy efficient home on when this thing hits bottom. I’ll bet I will get an awesome lot here for 10-15K cash when all is said and done.
Wish me luck
I wish you luck, Les. I’ve been reading your posts on this blog and you and Chip and dime have some great observations about Central Florida. Polk is really taking it on the chin, but I understood why when I saw all the development from 1-4 in the “Orlampa” area. I about messed myself, it truly is mind-boggling and rivals the sprawling Cali developments.
Winter Haven is a lovely little town, I hope it comes through this OK. Very little of Florida has been spared, except for some of the North Central areas.
I was on I-4 and thought the housing was a mirage - it went on forever w/o a single tree
Slightly off-topic questions:
What is the difference between Freddie Mac/Fannie Mae?
What is the difference between Fredd/Fannie and CDO’s/MBS’s? It sounds like all of these perform the same function, purchasing mortgages from originating banks/mortgage brokers and try to pool mortgages to (ostensibly) mitigate risk. Is this correct?
hmm.. apples and oranges.. or apples and fly swatters.
The “GSEs” work mostly in the secondary market. They make most of their money insuring mortgages which are owned by other lenders.
They’ll sometimes a bunch of mortgages from lenders, like banks, and then pool the mortgages into ’securities’ (MBS) and sell them to investors.
as for CDOs, CLOs, etc, try wikipedia.
http://en.wikipedia.org/wiki/Collateralized_debt_obligation
They’ll sometimes buy a bunch of mortgages..
the party in Florida is continuing to ratchet down
“Fewer Flights To Americas Playgrounds”
http://www.nytimes.com/2008/07/13/business/13bug.html?partner=rssuserland&emc=rss&pagewanted=all
I was back in New Smyrna this past weekend. I talked to a couple that owned two units at Seascape Tower. They were telling me how there is a unit that went for 700k, now for 480K. They said they wanted to sell theirs, but not in this market…They were going to wait. The realtor that is listing the unit above said it was a steal, and was surprised it hadnt been sold. She said she had showed it to 10 people and would buy it herself if she had the money. I said I would buy it at 250K. She looked at me strange. I still think we are in the denial phase of this.
I still think we are in the denial phase of this.
We are very much in the denial phase, but it is just starting to change. Look at the number of foreclosures from 2007 sales that were bought by those who thought they were buying at a low price or those who listened to the NAR.
I think the NAR and local realtor associations have done themselves significant harm long term via their hype and false information they have provided to the public.
It’s often very difficult to recover from a damaged reputation and history has proven many businesses never recover if they had distorted the truth to their customer base.
..and would buy it herself if she had the money. I said I would buy it at 250K. She looked at me strange…
imo, she’s no fool and wouldn’t buy it… that line is for suckers. When she heard the reply “i’ll buy it for..” the look you saw was her scoping you out to gauge your suckerility.
the Florida party may be coming to a close
fewer flights to Americas playgrounds
http://www.nytimes.com/2008/07/13/business/13bug.html?partner=rssuserland&emc=rss&pagewanted=all
I spend 2 months each winter in Sarasota, Fl on Siesta Key in a condo by the beach, and have considered buying. However anything decent is only down about 20% from the peak, and is probably still 60-70% higher than 6 years ago.
The bargains on the south-west coast seem to be in single-family houses, not good beach-front condos. I’ll wait and see, but I’m not hopeful for a drop in prices to an acceptable level. For a Snowbird, with all expenses included, renting is by far the rational option.
Take note how GOOD FOR NOTHING 99.9% of the ‘ Christian ‘ churches are!
Locked up tighter than a DRUM 6.8 days out of the week providing NOTHING to the local community but sucking TAX EXEMPT dollars!!!!
I myself am NO LONGER a ‘Christian’ because of the STINK & FILTH associated with it!
99.9 % of ‘preachers’ are CON MEN looking for SUCKERS like US to support them!
You cannot count on the ‘church’ for NOTHING!!!! but cheap LIP SERVICE!
The most WORTHLESS words in the world are : ‘we’re going to PRAY’ for you ‘brother /sister ! ( Faith with out WORKS is DEAD)
I see in our community so called (CON) ‘men of god’ playing golf every Monday yet the FOOOOOOL’s that support them are paying 4 bucks PLUS a gallon gas & commutinting 3 hours PLUS to WORK!
I KNOW people just like YOU on unemployment, behind on their house payment, hanging by their fingernails and the good for nothing CON MAN BASTARD in the pulpit wants 10 percent of the unemployment check!
I tell people in that situation, ask the BASTARD in the pulpit when you are HOMELESS is the BASTARD in the pulpit going to put a roof over your head!
WAKE UP!
David,
Sorry that you’ve been hurt by the church or a pastor. I hope that there’s more than .1% of them that aren’t con men, but there have been a few no doubt.
If you’re going to give up on church I hope you don’t give up on God.
Lip
Sorry to burst your bubble, but many of us Athiests are very, very happy.
Real estate is not really expensive in Canada except in a few places. The problem is that about 70% of the population wants to live on about 1% of the territory - somewhere near the older downtown parts of the major or semi-major cities. The Americans trashed their cities, we cherished ours and developed them. Now everybody wants to live there. Go about 100 miles outside
Vancouver or Toronto or Ottawa or other major cities and housing becomes very affordable.
The woman losing her house after living in it for thirty years is not likely to be a tragic victim of circumstances. She no doubt collected on her husband’s life insurance and should have paid the house off already or have about 500$ left on the mortgage after all that time. The article fails to mention the three HELOC’s, the brand new Cadillac, the vacations, the gifts for the kids and grandkids, and the weekly hair and nail jobs.
If my tax dollars are going to bail out Fannie, Freddie, and every Wall Street bank, I want strict regulations on mortgages. For starters, no Fannie or Freddie backed mortgage more than three times the national median income. End of story. If someone wants to buy more house than the average American can afford, then they must do it with totally private means. No backstops. That will stop most new bubbles and keep idiots out of trouble.
“In Naples, Fla., a three-bedroom, two-bathroom home that sold for $350,000 in 2007 is on the market for only $200,000.” We rented one of the nicest 3/2s in that area back in the 90s and it was offered to us for $140,000. Its still no bargain.
Real Estate is not expensive in Canada? ARE YOU KIDDING ME? 600 sq ft. condos are going for half a million in downtown Toronto. Canadians are blind. I just saw a house go in a crappy area of town - 2 bedroom, semi detached for 450 thousand. That’s insane. And of course, my fellow Canadians still say what is going on in the US will absolutely NOT happen here. Nevermind that it is happening all over the western world, Canada is immune because, well, we’re nice and kind and so much smarter than everyone else, aren’t we? Canadians are acting like smug little spoiled brats these days. You should see how mad people get at me when I tell them that Real Estate will go down. You’d think I blasphemed.
Not only that but Canadians pay for their homes in after tax income. No tax deduction for mortgage interest. There is also no such thing as a 30-year fixed rate mortgage. Mortgages are typically amortized over 25-30 years, but the terms are renegotiated at new rates every 1-5 years. In effect, every Canadian mortgage is an adjustable rate mortgage.
In the Miami-Fort Lauderdale area, the supply of single-family homes and condominiums for sale is enough to last for 34 months.
I’m in Miami this week and OMG, they are still freakin’ building these condos! There are cranes everywhere!
Here’s how one hardworking couple got to face foreclosure. These two had never been behind in their bills. Energetic and hard-working, Kara managed craft stores for a national chain. The employer moved her and her teenage daughter from the northeast to Florida to take over a store that was not doing too well, paying her moving expenses. She turned the store around, and had good reviews. Her longtime boyfriend, a truck driver, got a job near her, sold his house in the northeast, and with the proceeds, bought a house (pretty near the top of the market) near Kara, and his stepson and Kara and her daughter moved in, paying her share of the expenses and a ten-year mortgage. About a year later, she began to frequently feel ill. For about a year, she went from doctor to doctor seeking a diagnosis, continuing to work. Finally, after amassing considerable co-pay debt, she was found to have lupus. The doctor that made the diagnosis sent her for a mammogram, and and a couple of weeks later, she was found to have a tumor in her breast. Her employer changed medical insurance providers to one that paid even less. She had a lumpectomy. The lump was cancerous, and had spread locally. She then had a double mastectomy, because the lupus complicated treatment for the cancer, then started a course of chemotherapy. She was turned down for short term disability on the grounds that this was a pre-existing condition because she had gone to so many doctors in the past year. She continued to work, taking time off only on chemo days, and the couple of days she was in the hospital after having a bad reaction to the chemo; she was very tired and spent most of her time at home asleep. One day, when she was tired after a recent chemo, a friend helped her (without pay) move boxes at her store. A few days later she was fired. They said having a friend help her showed that she was unable to do her job. Losing her job meant that she would lose her medical insurance 30 days later or go on Cobra, something they couldn’t afford without her salary. Her husband had his hours cut to three days a week because his employer had less business. She applied for unemployment insurance, but her employer contested it. She and her boyfriend married so he could add her to his medical insurance. Three months later, the couple was having trouble making ends meet with one and a half less salaries and a growing debt of large insurance co-pays/deductibles. Kara tried to get a job, but had lost her hair from chemotherapy, and was turned down after interviews. They got behind on their mortgage, and now fear foreclosure. She has just had her unemployment approved, but even retroactively, it will not be enough to catch up on their mortgage payments and the minimum she needs to pay on her medical bills. The bank will not even talk about refinance unless they pay all the back payments and late fees that they owe first, even though his equity in the house equals 2/3s of its value. She has finished her chemo, and hopes that soon she will look healthy enough to get hired, soon enough to keep the house. Both are doing odd jobs when they can get the work. She still faces treatment for lupus. She is 46 years old, and can’t wait for medicare.
This could happen to most any of us. The downhill slide can happen fast as a toboggan run, and in spite of hard work and frugality. It would be nice if some of the corporate welfare could trickle down to people like this.