A Flu That Would Become An Epidemic In California
The Press Democrat reports from California. “Every week in Sonoma County, banks take back 60 homes from owners who have fallen behind on their loan payments. Sensing an opportunity in an otherwise slow market, real estate agents and mortgage brokers are organizing tours to showcase foreclosure properties to potential buyers. Almost every weekend this summer, buses carrying first-time buyers and investors roll through neighborhoods across the county. Most foreclosure properties can be bought for less than $400,000 — sometimes much less.”
“‘Almost everything I look at these days is a foreclosure. I’m surprised when it isn’t,’ said Pete Deatherage, co-owner of Pacific Appraisals in Rohnert Park.”
“‘I can never remember the market dropping as much as it’s dropped and this many people rushing in to buy in this short time frame,’ said James Madison, a foreclosure specialist at Coldwell Banker with three decades in real estate.”
“Richard and Teja Faria paid $330,000 in the same Santa Rosa neighborhood where they sold a similar home for $590,000 three years ago — a 44 percent difference. ‘It’s scary because it’s a declining market. But we want to buy because we want an affordable mortgage payment,’ he said. ‘The timing is perfect.’”
“The couple recently returned to Sonoma County to raise their two children. Driving the county with his agent for several weeks, Faria found plenty of foreclosed homes, but twice came up short with purchase offers.”
“‘We were frustrated,’ he said. ‘But we took a shot and like everybody else in today’s market, that’s what you have to do.’”
“Not wanting to miss out again, Faria offered $12,000 above the bank’s price for the 1,700-square-foot home in southwest Santa Rosa. The deal should close within a month.”
“Tosh Lu took the tour to aid his search for investment property. ‘In one tour you get many neighborhoods. This saves a lot of time,’ said the Rohnert Park resident. ‘I’m going to buy before the market goes back up again.’”
“Now a renter, Gary Everson, a 19-year-old looking with his mom…figures he can buy a house and make the mortgage payment with help from roommates. ‘Before, I didn’t think I was ever going to be able to buy a house, not until I saw these prices,’ he said.”
The Sacramento Bee. “For two years and three months, Doug Pautsch ran a division of Centex Homes that routinely led the Sacramento region in sales of new homes. On July 11, Centex ousted Pautsch. Pautsch has called the move an apparent retaliation for his lawsuit against Centex, a publicly traded home builder based in Dallas. The lawsuit, filed in Placer Superior Court, alleges that Centex didn’t pay Pautsch $355,000 in promised bonus money.”
“Recently, the 16-year veteran of the region’s home-building scene talked about his bird’s-eye view of the housing downturn. Q: Sacramento was one of the first U.S. housing markets to fall apart. Was it a problem communicating that to headquarters?”
“A: The first nine months everyone was in denial: ‘That’s just a little cold that Sacramento has, just a little speed bump. We’ll get through it. It’s just Sacramento.’”
“They didn’t realize it was a flu that would become an epidemic. My local counterparts and I would talk about it. At their respective corporate offices, not just mine, people just didn’t understand. Across the country everyone was full speed ahead. Money was flowing and sales were happening. It must just be Sacramento because it went up so quickly.”
“It was six to nine months before people realized this wasn’t just a Sacramento issue. They’d say maybe it was just California or Florida, and maybe it was just Northern California. There was a lot of denial going on. But as we know, everybody caught the flu.”
“Q: Where is this market going? A: I think we’re at the bottom. We’re going to bounce around a little bit. We moved through the foreclosures. They’re being absorbed by the market. Inventory has been coming down so there’s not a huge inventory issue anymore. I believe we’re at the bottom.”
“I think it will be next year when we start to see recovery. I define that as prices starting to go up.”
“Q: What keeps you up at night? A: I think there’s going to be a shortage of lots…When the herd leaves and the market has changed, they will chase the same lots. There will be a shortage of developable lots.”
The Press Enterprise. “Canyon Lake resident Matthew Larson is trying to help fight the foreclosure crisis. His weapons of choice are gallons of green paint. The battlefields are dead, brown front lawns.”
“Armed with a sprayer that resembles a pearl-colored jet pack, Larson paints lawns with a turf colorant traditionally used at golf courses. ‘It gives a home instant curb appeal,’ Larson said as he sprayed the green paint on the lawn of a repossessed home on Longhorn Drive in Canyon Lake.”
“Riverside County has been among the counties hardest hit by the mortgage crisis nationwide, according to real estate statistics. ‘I got into this because this crisis is not going to get any smaller, and someone has to step up,’ Larson said. ‘We’ve got beautiful, new communities and it is a shame to see them fall apart.’”
“It was a fix Jerry DiBernardo, the real estate agent listed for the Longhorn Drive home Larson painted, was willing to try. ‘I’ve seen it done on other properties. It was an opportunity to see if it will help sell the property,’ DiBernardo said. ‘It’s got to look better than the dying brush. Anything is an improvement.’”
“Perhaps the biggest obstacle, however, is psychological, said Robert Green, a turfgrass research specialist at the UC Riverside College of Natural and Agricultural Sciences. ‘There will be some who just aren’t used to the idea of painting grass,’ Green said.”
The North County Times. “It’s called a note job. Someone, usually a man, walks up to a bank teller and slips a piece of paper across the counter. Note jobs are the most common kind of bank robbery, a crime that decreased nationwide in 2007, but increased in San Diego and Imperial counties, said Special Agent Darrell Foxworth of the FBI’s San Diego field office.”
“In 2006, the two-county area had 146 bank robberies. In 2007, that number went up to 171. By July 16 of this year, there had been 108 bank robberies and, if prior years are any indication, there will be more robberies in the second half of 2008 than there were in the first.”
“Though the majority of bank robbers are drug addicts, a certain type of robber —- likely to pull a note job —- may be particularly active in a stagnant economy, said William Rehder, a Los Angeles-based bank robbery consultant formerly with the FBI.”
“These so-called subsistence bandits aren’t necessarily trying to support an addiction. They may have lost their jobs, lost the financial stability of a marriage, or finally cracked under the stress of mounting credit-card debt, Rehder said.”
“‘More recently, of course, they face the home mortgage foreclosure problem,’ he said. ‘There have been a number of these folks that maybe wouldn’t consider bank robbery ever in their lives —- but they’re facing the world-shaking desperation of these problems and they see this as a last resort.’”
The Mercury. “In a bad economy, fun is often the first casualty. For James Hedrick, that means it’s a busy time in his line of work. He’s one of those dreaded ‘repo men’ who repossess items after people fall behind on their payments.”
“He spends his days scanning megayachts, sailboats and fishing skiffs. Hedrick is an agent with National Liquidators, considered by industry experts to be the world’s largest marine repo company.”
“The company has tripled its business in the past three years, and now takes possession of about 200 boats a month in Florida, Ohio and California. The company’s competitors also say they’ve seen similar increases in business.”
“‘They’re going to hang on to the car, they’re going to hang on to the house. But they’re going to give up on the boat,’ said Hedrick, whose employer has doubled its staff in two years to 85 repo agents so they can meet demand from the banks and lenders.”
“It’s not just boats: Repo agents say banks and lenders have been asking them to reclaim all-terrain vehicles, motorcycles, small planes, snowmobiles, semi-trucks and, of, course, cars. Vehicle repossessions were up 10 percent in 2007 over the previous year, said Tom Webb, an analyst for Manheim, the largest car auction company in the nation.”
“Sometimes, owners turn the boats in to the repo agencies when they realize they can no longer pay. But other times, they hide or vandalize the boats before they can be seized, said Megan McQuaide, the owner of Repo Yacht Sales in San Diego. She’s boarded boats with oil splashed around the cabin, engines intentionally overheated and feces on the deck.”
“‘Sometimes it’s really malicious stuff,’ she said.”
“One boat dealer, whose company also does recovery for banks and lenders, says those facing boat repossession were typically involved in the housing boom either as a real estate agent, construction worker or mortgage broker.”
“‘A lot of this is self-inflicted. It’s somebody who three years ago made $50-$60,000 and didn’t save a penny,’ said Ray Jones, the owner of Long Beach Yacht Sales in California. ‘They thought the income would never end. But the income stopped and the toys went away.’”
I’m running a little behind. I had two auctions to see today and after some research, I’ll post a summary.
“Now a renter, Gary Everson, a 19-year-old looking with his mom…figures he can buy a house and make the mortgage payment with help from roommates. ‘Before, I didn’t think I was ever going to be able to buy a house, not until I saw these prices,’ he said.”
Urgent…Quick…This won’t last long…Buy Now, before the 19 yr. olds and their Momma’s BUY them ALL UP.
Spare me
The 2006 mentality is still alive and well in some quarters….
….therefore, I see that 19 yr old taking it in the hind-quarters.
By the time he’s old enough to drink, he’ll need to.
Ben:
Are you going to auctions held by banks to sell their REOs, or to courthouse foreclosure auctions?
Courthouse. It’s amazing what you learn. Today, BoA bought a house they had HELOCed. They were the second, and outbid the lone bidder through the auctioneer no less.The independent bidder only raised em $1,000. Sold for $183k.
I’ve been to many hundreds of auctions and learned a little something from each one…
A great place to sharpen your powers of observation~
You should go often.
I truly am sorry! Change the state, if you wish, and it is still true.
158 years ago
158 years ago
Date: On Monday, July 21, 2008, 10:02 PM
Do you know what happened this week back in 1850, 158 years ago?
California became a state.
The State had no electricity.
The State had no money.
Almost everyone spoke Spanish.
There were gunfights in the streets.
So basically, it was just like it is today, except the women had real breasts and the men didn’t hold hands.
the men didn’t hold hands.
Well at least one thing has improved over 158 years.
Only if you prefer silicone implants
It used to be girls wore falsies on the outside of their bodies.
screw that, I want the REAL thing, B cup and all!
I would rather men hold hands and not have their hands in places they don’t belong.
Sylvia, is that you?
California became a state on September 9, 1850.
September, not July.
Stop confusing people with the facts! lol
I was singing happy Birthday and then I got to your post, typical spoil sport.
Short-bus whine tour…
“The couple recently returned to Sonoma County to raise their two children. Driving the county with his agent for several weeks, Faria found plenty of foreclosed homes, but twice came up short with purchase offers.”
“‘We were frustrated,’ he said. ‘But we took a shot and like everybody else in today’s market, that’s what you have to do.’”
And note this…
“Not wanting to miss out again, Faria offered $12,000 above the bank’s price…”
People are still voluntarily offering more than the asking price? Nah, bottom’s a looooong way off.
BTW, if any saavy buyers out there feel obligated to offer the bank more than they’re asking for a REO, might I suggest sending some of that largesse my way instead ($12,000 is still a lot of money to me)?
I would so wash my hands of any bank that thought they had leverage these days
We had some moron come in and bid near asking for a trashed REO we were looking at. It was IMHO worth about half of what the bank was asking. The moron in question just estimated cost to make the property whole, subtracted that amount from wishing price, and made the offer.
I told my realtard to let me know when it falls out of escrow.
Wonderful, this must be the “amateur night on the REO circuit” phase. Just more bodies that will need to be hauled away.
Tons of these people in the lower-end areas of San Diego. It appears many of them are “investors” who are going to do minimal fixes and rent them out “until the market improves.”
What happens to rents when all these homes are thrown on the rental market? Fundamentals change…
Nobody’s even thinking about the recession/depression that is yet to come. It’s just good times ahead!
The bubble mentality is alive and well. We have a long way to go.
“‘A lot of this is self-inflicted. It’s somebody who three years ago made $50-$60,000 and didn’t save a penny,’ said Ray Jones, the owner of Long Beach Yacht Sales in California. ‘They thought the income would never end. But the income stopped and the toys went away.’”
A boat with slip payments on 60k a year…wtf…
“those facing boat reposession were typically involved in the housing boom either as a real estate agent, construction worker or mortgage broker”
Well, that explains a lot for me. Also when the yacht guy says 50-60k a year his probably basing that on actual income, not what these clowns fabricated on their Alt A, No-Doc loan application.
No matter how you look at it, one thing for sure. This guy had a year to play around with his yacht. When will that opportunity ever come around again for the middle class?
They yacht a never lent the money to landlubbers in the first place…
Walk The Plank__________
You want a yacht? No problemo, take your pick. The market is saturated with them.
All you need is that widely despised cash stuff.
Don’t laugh, one of my many “bubble-solutions” was to buy a boat and live aboard without property taxes etc! I think though, unlike the realtwhores the yacht finance community is much better prepared to deal with the whims of the economy.
I imagine there was a similar sell-off when the dot.com wealth evaporated. Nothing new to them.
Nothing new, but there have *never* been so many yachts owned by so many who cannot keep up with the payments. Never before have so many yacts *required* crews.
I have a relative who works for a yacht manufacturer. The high end sales keep going, but the minimum length to sell keeps going up every quarter. They’re selling out at the high end… but shorter boats just aren’t selling.
This isn’t over… but we’re starting to see the end run.
Got Popcorn?
Neil
Actually it comes around every day. It’s called r-e-n-t-i-n-g a boat. LOL! Hell, that’s what “I” do? We used to rent a houseboat ( when our daughters were not yet too cool to be seen with us ) and we lived like kings… for an entire week!
You think there’s still a middle class?
hehehehehe
Yeah. Good times.
Here is another one that did not save a penny. (Is it ok to post links?)
http://news.yahoo.com/s/ap/20080728/ap_on_en_tv/tv_extreme_makeover_foreclosure;_ylt=AqZOCYoX.sX8bAUtclclMOEDW7oF
greedy pigs. I just don’t know what else to say. They had a brand new luxury house and $250K donated to them, but that wasn’t enough.
It is sickening that the news article has described the Harper family as “a victim of the foreclosure crisis”.
Victim indeed having a 450,000 home and 250,000 cash simply handed over to them.
“ABC said in a statement that it advises each family to consult a financial planner after they get their new home. “Ultimately, financial matters are personal, and we work to respect the privacy of the families,” the network said.
Some of the volunteers who helped build the home were less than thrilled about the family’s financial decisions.
“It’s aggravating. It just makes you mad. You do that much work, and they just squander it,” Lake City Mayor Willie Oswalt, who helped vault a massive beam into place in the Harper’s living room, told The Atlanta Journal-Constitution.”
I never watch this show, I always find the “oh my god’s” a bit to much.
Personally, I like seeing the mayor and others take it in the a$$ from a couple of lowlifes for $450k.
We took 150 kids, ages 14-18, up to the high sierra last week for a re-enactment of the handcart pioneers trek. In every possible respect we tried to live like it was 1856 again. Osa meadow (near Tulare/Inyo county line) at 8500 ft. elevation was a pristine and beautiful backdrop to a great experience.
I’m back in the real world today, it’s not a pretty thing.
BTW laddy, the water level in the creek running through the meadow was quite a bit better than when we went 4 years ago.
We took 150 kids, ages 14-18, up to the high sierra last week
Glad I put off my backpacking trip after all
It actually amazing how differently kids act when they don’t have cell phones, video games, ipods, etc.
They actually listened and participated, having said that, you are correct. You would not have wanted to camp in the same area we did. Lot’s of talking way into the wee hours, and not much sleep. Fortunately the area we went to had few if any other campers.
Last month I went to a neighborhood gathering where everybody brought their kids. Virtually all of the boys and several of the girls, ages 9-12 or so, immediately made a bee-line for the rec room, pulled out their PSPs or gameboys or whatever “personal game console” they had, and sat in their own little worlds, totally absorbed in their electronic games, not speaking or interacting with any of the other kids. It was pathetic. I couldn’t believe the parents didn’t take the gizmos away and tell little Johnny or Jordan to get a freakin’ life.
They didnt’ play together? They used to make video games that kids would play together.
You know Sammy and Big V, I teach after work and the students don’t think I see them texting when I turn to the board. I have to be honest, as long as I don’t hear a phone make noise I don’t give a sh$t. I told one student that didn’t want to do HW that I wasn’t his mother and I really didn’t give a sh$t if he did the HW. I said I would fail them all without batting an eye.
Because it is so hot that the glaziers in Kings Sequia are melting fast water levels in creeks and rivers great… for now.
Northern Sierra bone dry. No glaziers.
…glaciers… sorry.
“handcart pioneers trek”
MBM - Must be Mormon
“‘I can never remember the market dropping as much as it’s dropped and this many people rushing in to buy in this short time frame,’ said James Madison, a foreclosure specialist at Coldwell Banker with three decades in real estate.”
“Richard and Teja Faria paid $330,000 in the same Santa Rosa neighborhood where they sold a similar home for $590,000 three years ago — a 44 percent difference. ‘It’s scary because it’s a declining market. But we want to buy because we want an affordable mortgage payment,’ he said. ‘The timing is perfect.’”
Don’t tell me that 200k bump in Freddie/Fannie loan limits won’t stop the bleeding in California…it’s just what the doctor ordered…
They have to qualify for the higher amounts.
If they have the income then fine. That eliminates most of the problem.
Sure there will be fraud but there will be more scrutiny now.
You obviously have never been involved in the origination and packaging of FHA/Freddie loans…
Yep, it’s amazing how many properties are going from pending to falling out of escrow now in a never ending cycle of, “I don’t qualify”.
How many of these deals were were FHA…?
OK, true that, but what about with Nehemiah corp. funding going away?
Doesn’t matter…they only did a small percentage of loans anyway…actually they should have kept Nehemiah their qualifying/underwriting/appraisal process was far superior to FHA’s…
They also didn’t eliminate the ability for funds to be gifted, which opens the door for a lot of what’s called silent seconds…and I’m curious to see how the $7,500.00 loan/tax credit can be used…
Here’s the bottom line there are a zillion holes in the FHA/Fannie process to get someone qualified for a loan a guy whose been in business 2 or 3 years has no clue about the manipulation available to him…if Bush signs he will be quickly trained…and the games begin again
Obama will be trained and McCain will laugh that he didn’t waste four years of his life.
Bush will slink away before the SHTF
I meant loan agents not Bush…sorry if that wasn’t clear…
But these guys are under a lot more scrutiny now. The investors aren’t as eager as they once were, so they are still demanding higher rates, and their demands increase with the size of the loan. Also, the regulators are sweating bullets trying to prevent the public from figuring out that they have been asleep at the wheel this entire time. While I do think that much of the activity today is fraudulent, I also think that fraud is getting harder to commit. The brokers and RE agents are beginning to find Jesus.
How do you stop the bleeding with higher loan limits when prices are already in decline? Los Banos is down 60-70%, Stockton is down 40-50%, and the declines show no sign of slowing. It makes no difference that you can now get a $1,000,000,000,000 F-backed mortgage because the houses have already dropped below that point, and nobody wants them.
“…I also think that fraud is getting harder to commit…”
What makes you think that…? Nothing in the bailout addressed the fraud… Get back to me after Bush has signed the bailout…
No offense but the rest of your comment is speculation with the exception of the price decreases…again we will pick this up after Bush signs…
“Tosh Lu took the tour to aid his search for investment property. ‘In one tour you get many neighborhoods. This saves a lot of time,’ said the Rohnert Park resident. ‘I’m going to buy before the market goes back up again.’”
I am ready to give up on SoCal after reading these stories.
I think it has gone WAY past Kool Aid drinking - I think the “real estate always goes up” mantra is embedded into the DNA of people that live here.
People here believe that prices declining 25, 30, 40 percent from the peak is the steal of the century because real estate always goes up in SoCal.
The fact that prices doubled and tripled in the last 7-8 years - that’s not crazy. The fact the prices have come down so much - that is apparently crazy, and won’t last, so we’d better hurry up and by before prices return to “normal”!
I believe this is Sonoma Co and is north of SF.
I would like my amend my post from “SoCal” to “All of California”…….
Yea, this is NoCal but the Kool-Aid is just as strong in So-Cal
Oh, SoCal Kool-Aide is NUTTIN compared to the NoCal type. SoCal Kool-Aide is sweetened with Splenda. The NoCal stuff gets the double sugar and caffiene spike with a side of X. Nothing too special for the smart, sophisticated, edgy specialists up here.
Big: That’s because no cal folks have always been way more classy, intellectual and sophisticated than us lowly socal folks. All we had was that tacky entertainment business down here.
‘It’s scary because it’s a declining market. But we want to buy because we want an affordable mortgage payment,’ he said. ‘The timing is perfect.’”
This has got to be one of the dumbest statements I have ever read. These people are definatly drunk on kool-aid.
–
‘I’m going to buy before the market goes back up again.’
This guy thinks that he can foretell the future. Did anyone claim that he would sell before the prices start to decline and wait until then?
Us long-term bears have nothing to fear.
Jas
“Now a renter, Gary Everson, a 19-year-old looking with his mom…figures he can buy a house and make the mortgage payment with help from roommates. ‘Before, I didn’t think I was ever going to be able to buy a house, not until I saw these prices,’ he said.”
Ah, to be 19 again and have a “plan”.
It’s a pretty sure bet that roommates will never disappear, tell you they’ll pay you next month sometime and then forget, or permanently invite in 5 jobless, homeless, pyromaniac alcoholics until “things get better”. The typical 19 year old has thought it all through, and knows nothing can go wrong. Fer sure, dude
“…a 19-year-old looking with his mom…”
I thought mothers were supposed to protect their young from danger, not introduce them to it. She must be an agent…or a crocodile - no matter, they both have the same instincts - and skin texture.
I can’t get too bent out of shape over this, nor assign it any more gravity than it deserves. A LOT of 19 year olds say stupid things. Hell, adults? I think this is a normal part of human psychology. After years of unattainable, insane prices, particularly in higher priced markets, this recent leg of the sell-off has got to look like a relief.
Most won’t follow through on it. It’s just our way of saying, “Geez, even if I took the plunge now I wouldn’t be as bad off as… ’some’ people!?” In a lot of cases most of just think it, but wouldn’t say it out loud.
I think he means his mom [is] one of the roommates.
Really?
In that case I wonder why doesn’t mom just buy it herself and make the son contribute? Sounds as if he wants to be on the deed himself - hmmmmmm.
“In that case I wonder why doesn’t mom just buy it herself…”
Remember this mother-son class act?
Do her dogs stay in the car or do they live in the house ? LoL
So, let me get this straight. The “cheap” houses are those under 400k and that brings out 19 year olds to buy!?
ej, I’m thinking of the movie “Spanking the Monkey”.
“Ah, to be 19 again and have a ‘plan’.”
I’m rooting for him. Our economy could use a couple of hundred thousand more just like him.
Slightly OT, but did any of you other locals notice that the LA Times is now ceasing printing of the Sunday Real Estate section entirely? It’s being folded into the Business section now.
Man, when the LA Times can’t even manage to continue dishing out the Kool Aid, you know times are a changin’!
Baybe they’ll go the route of the OC Register and begin to trash their home RE market.
Baybe = Maybe
Baybe sounded much more LA, though.
Maybe, baby…
The Times has become a 3 month layover for journeymen journalists, until they get fired and have to look for another job @ some other dying newspaper.
Aladin-Re journeymen journalists, would you kick a grandmother down the stairs because you think she outlived her usefulness? From the sound of things, it seems like you would.
Sometimes it’s helpful to understand what you have, rather than what you don’t.
You could, if you like, take a look at state-controlled media flowing from Beijing or other places that censor, even the Net.
I don’t usually take comments personally, and greatly believe the answer to free speech you may not like is more free speech. I was laid off from McClatchy Corp. a month ago. Perhaps I misread the tone of your brief post. The MSM does seem to be the second favorite whipping post on this board. The degree to which it created or led sheeple to financial ruin could be dissected, mayhaps as a weekend topic.
But you are spot on this: the industry truly is dying.
135 company layoffs in Media and communication since 12/23/2007
These are the McClatchy Company announced and confirmed layoffs and dates. They accounted for 10%+ of all layoffs in media. Sorry
The McClatchy Company January 25, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 16, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 16, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 16, 2008
The McClatchy Company June 16, 2008
The McClatchy Company June 16, 2008
The McClatchy Company June 17, 2008
The McClatchy Company June 16, 2008
These are different divisions not including the Miami rag.
On the good side media is doing better than medical care. Don’t get sick.
Must haves of 1900:
Horse, Buggy, Reins, Whip
Must haves of 2000:
Newspapers, Radio, Movies, TV
Things change…
also, the printing of standalone RE advertising they gave away at
groceries and 7-11 has nearly ceased. Four-color glossies too costly
to print. I sympathize with the printing job shops. Another ripple effect of bubble going down whoooosh.
Trib print properties are pressed to keep their presses pressing. One of my jobs is supporting a LA tabloid weekly and the ad rates are getting scary-scarce. The price of paper and transportation is munching on the pressman’s behind while the downturn is punching him in the gut with reduced ad sales.
Meanwhile, the internet’s busy giving him a handjob but he dare not shoot his load because the net will lose interest once he unloads all his contents and he’ll go flaccid into that long goodnight. Such is the state of newsprint in SoCal.
And what’s the deal with the Sunday houses for sale section, there used to be houses in there in the 600k range, now everything is over $3 million, I don’t bother reading it anymore because it’s just too depressing. Maybe the advertising got too expensive to list normal homes, and the middle to low end brokers found other methods.
Right, the housing market must be booming again, especially in west LA! This must really bum you out, laig.
Patience, grasshopper. Housing values will fall for several more years. Save your money in the meantime.
The chart for Wachovia (WB) looked ugly today. Increasing volume as it consistently declined in price. We may be seeing another waterfall ahead…
Wachovia is toast - I wish I know something about investing cause they are done…..(dorky scientist here)
Dorky engineer here.
I hear dorky scientists and engineers in China, India and Africa will work for a lot less money than you will.
I wouldn’t dare think that your wages (in real terms) won’t drop going forward. They’re going to drop plenty, just like those in most other fields already have.
It’s probably too late to respond, but dorky scientists and engineers in China and India have already forced engineering wages down. That’s why bright, hard working Americans go into finance. It’s not that we are too lazy to do the work.
I haven’t noticed much competition from Africa though. Engineers and scientists take 4-5 years to train up to entry level, so don’t look for any sudden shifts in supply.
I hope the US doesn’t need home-grown engineers and scientists in a hurry.
Dorky Engineer here
Honestly: Not worried about those dorky Chinese and Indian engineers. I have seen their work. It’s great as long as it is “ant work”.
When it comes to “original thinking” they will stare at you with the deer-in-the-headlight look.
Anyone heard of ORIGINAL Indian software/hardware? Chinese Software/hardare?
In the future, the only value will be that of information (even today, it is relatively cheap to buy a new TV, but relatively expensive to dowload that song or movie). This trend will grow.
Regards,
arit
my niche is ok too… (nothing is 100% safe, but some safer than others)
“Slightly OT, but did any of you other locals notice that the LA Times is now ceasing printing of the Sunday Real Estate section entirely? It’s being folded into the Business section now.”
Not enough ads to support the section!
Further OT but another sign. Someone was putting up a substantial “luxury condo” building in Brooklyn in a semi-industrial area next to the last stable serving the horse trails of Prospect Park, complete with all the smells of the farm! The substantial concrete plank building — seven stories and a few hundred feet long — topped out some time ago — you can tell in NY by the American flag left by the union.
Work has stopped. The stable owner told them they lost their financing. The lender realized the project could never sell at “luxury” prices and pulled the plug with the cost of the complete building skeleton, the sitework, foundation and site already sunk!
It gives every lawn that Tagger Appeal…
“Canyon Lake resident Matthew Larson is trying to help fight the foreclosure crisis. His weapons of choice are gallons of green paint. The battlefields are dead, brown front lawns.”
“Armed with a sprayer that resembles a pearl-colored jet pack, Larson paints lawns with a turf colorant traditionally used at golf courses. ‘It gives a home instant curb appeal,’ Larson said as he sprayed the green paint on the lawn of a repossessed home on Longhorn Drive in Canyon Lake.”
Nothing says neglected foreclosure that needs an expensive sod job than a painted lawn.
“Instant curb appeal” equals Potemkin Village. Hate to think of the chemicals he’s depositing in the groundwater, too. On general principle I’d refuse to deal with anyone who resorted to stupid tricks like this.
I remember reading years ago the huge real estate section w/front page title, here in the Sacramento Bee. so artsy, so well laid out . . . then I noticed the “paid advertisement” disclaimer also, but in tiny font, barely legible.
the papers all deserve every bit of cold dish instant karma coming downhill for their tactics of encouraging a biased story for ad revenue. which also makes me laugh whenever I read about some agent whining over the current “bad news stories” from the papers.
‘course it didnt matter a whit if sellers were price-gouging buyers. that was a-ok because they got bigger paychecks. after all, it’s just “the market” or some other self-serving justification for the daily price increase.
hypocrites.
Extreme Foreclosure - a sad sign of the times….
LAKE CITY, Ga. — More than 1,800 people showed up to help ABC’s “Extreme Makeover” team demolish a family’s decrepit home and replace it with a sparkling, four-bedroom mini-mansion in 2005.
Three years later, the reality TV show’s most ambitious project at the time has become the latest victim of the foreclosure crisis.
After the Harper family used the two-story home as collateral for a $450,000 loan, it’s set to go to auction on the steps of the Clayton County Courthouse Aug. 5. The couple did not return phone calls Monday, but told WSB-TV they received the loan for a construction business that failed.
The house was built in January 2005, after Atlanta-based Beazer Homes USA and ABC’s “Extreme Makeover” demolished their old home and its faulty septic system. Within six days, construction crews and hoards of volunteers had completed work on the largest home that the television program had yet built.
The finished product was a four-bedroom house with decorative rock walls and a three-car garage that towered over ranch and split-level homes in their Clayton County neighborhood. The home’s door opened into a lobby that featured four fireplaces, a solarium, a music room and a plush new office.
Materials and labor were donated for the home, which would have cost about $450,000 to build. Beazer Homes’ employees and company partners also raised $250,000 in contributions for the family, including scholarships for the couple’s three children and a home maintenance fund.
built in 6 days?! dayum. I’d have a structural engineer give it a good once-over before I placed any bids on that xtreme makeover. and hire a 14yr old teen to look it over also, since they know everything.
Wow….how does that happen…?
“Wow….how does that happen…?”
Greed + stupidity = foreclosure
They HELOC’d it to its full value. Keep in mind, they were also awarded $100,000 cash. Sort of like many lottery winners - they ramped up their lifestyle.
Dirtballs. But hey, let’s bail them out!
That’s a “sad” story? I’d call it one reason I so rarely give to charity. These greedheads milked their gift horse for all it was worth, and now will no doubt milk their stupidity to try to have another group of strangers rescue them from their irresponsibility.
True story: Two years ago, I was in Mississippi for a week of post-Katrina reconstruction. My team was redoing some really crummy work that had already been done on a drywall installation when word came down from on high: Get out of this house. Now.
What prompted this abrupt halt to the work? It was something that one of the homeowners said to my team’s supervisor, namely, that she and her husband were planning to fix the house up so they could sell it. Since the organization I was with was working to get homeowners back into their homes, we were pulled off the job.
Katrina will be 3 years ago next month. From what you saw, who wouldn’t have considered leaving the area once they were made whole? Everyone who returned thought about it, whether out loud or not. Look up Louisiana’s Road Home Program (state-sponsored buybacks).
Do you think this couple would have profited over the pre-Katrina value had you completed your work?
While I can’t speak for Mississippi, I find it interesting that throughout all the coverage of post-Katrina New Orleans is that none of the press outlets have openly recognized/stated that a huge number of the houses were crumbling, termite-infested, more or less worthless ratholes before Katrina was even a twinkle in Ray Nagin’s eye.
Katrina actually did a lot of good in erasing thousands of decrepit properties off the face of the Earth.
Before anyone slams me, think about it.
You’re right, but they don’t dare say it in public. They’ll do anything to keep money flowing in for ‘aid’ and profit from it 100 different ways. Those houses were shacks before the storm. Fix them up and they’ll be shacks again in a few years, that’s the way of the world.
FWIW I didn’t see much of any construction/repair work going on when I was there in Dec. except for a street repair crew tearing up the main drag by the french quarter. It didn’t appear they were doing much other than waving the flag to show tourists that work was happening. At a glacial pace.
Louisiana is a little crooked, so I hear.
GAWD, what a bunch of greedy, ungrateful, inconsiderate JACKASSES!!!!
Someone gives them a free house and a wad of money, in the process basically ruining things for the neighbors, and these jerks respond by using the house as a way to defraud a bank? This “poor family” has now gotten away with approximately $700k (yes, I know they had to pay taxes, but still). I’m telling you dude, it is never a good idea to give people that kind of a gift. I will give food to the starving, but the thought of people getting away with that kind of money just really irks me.
As I said above, I enjoyed reading about how these folks BF’d all the volunteers, donations and the mayor. Dumfux to a person.
‘The first nine months everyone was in denial: ‘That’s just a little cold that Sacramento has, just a little speed bump. We’ll get through it. It’s just Sacramento.’
‘They didn’t realize it was a flu that would become an epidemic. My local counterparts and I would talk about it. At their respective corporate offices, not just mine, people just didn’t understand. Across the country everyone was full speed ahead. Money was flowing and sales were happening. It must just be Sacramento because it went up so quickly.’
‘It was six to nine months before people realized this wasn’t just a Sacramento issue. They’d say maybe it was just California or Florida, and maybe it was just Northern California. There was a lot of denial going on.’
As someone interested in housing bubble history, the chance to hear Sacramento’s Centex chief give a little inside dirt is very interesting. For those that don’t remember, Sacramento was the first big CA SFH market to break down, with the possible exception of the Coachella Valley. San Diego was more of an urban/condo bust, initially, and not new subdivisions. So much to remember.
Yep, but this guy is still pretty clueless, he’s worried about a shortage of lots in the near future? Wow! Just, wow!!!
Maybe he meant a shortage of developable, unpainted lots?
LOL!
Just tear down all the unused houses. That’ll free up plenty of lots.
If I were Mr. Pautsch, I think the $355,000 I was owed would keep me up.
““Q: What keeps you up at night? A: I think there’s going to be a shortage of lots…When the herd leaves and the market has changed, they will chase the same lots. There will be a shortage of developable lots.””
More than the timing issue, he’s also assuming that types of housing and development patterns will be the same in the future as in the recent past. I think that’s a big stretch for many areas. How viable are super-sized houses requiring extended commutes in a world of much higher energy costs? The business model of the big builders will have to change for there to be any chance for survival.
Armed with a sprayer that resembles a pearl-colored jet pack, Larson paints lawns with a turf colorant traditionally used at golf courses.
This can’t possibly be legal, in terms of both environmental and property/trespass law.
It’s just food coloring. Gets all over your golf shoes. A soaking rain will wash it away.
Breaking “about-to-be” news. More fallout and “victims” of the mortageg mess: I came to work today in Commerce, CA and there were spanish station news vans and all these little immigrants all riled up with paperwork in the front of the building, extra security all around. Apparently the bilingual mortgage company that opened up a few months ago was promising refinancing, etc, but took off with all their money. You might catch it on KMEX Channel 34 in Los Angeles if at all (spanish station).
For some reason, Mexicans always seem to get screwed when it comes to dealing with the DMV, and mortgages.
More often than not they get screwed by fellow Hispanics. Not a peep on this from La Raza, I’ve noticed.
“The Race” I believe is the translation.
THE race?
Excuse mention if I put their group on my internal ignore button.
Whoops. Excuse me if……
Ha, Mexicans are also more likely to get involved in shady dealings to begin with. They don’t always grow up with a big respect for the law.
That may be more truth then most can handle Big V
“Give me all of your 10’s, 20’s and 30’s, and nobody gets hurt”
“It’s called a note job. Someone, usually a man, walks up to a bank teller and slips a piece of paper across the counter. Note jobs are the most common kind of bank robbery, a crime that decreased nationwide in 2007, but increased in San Diego and Imperial counties, said Special Agent Darrell Foxworth of the FBI’s San Diego field office.”
“In 2006, the two-county area had 146 bank robberies. In 2007, that number went up to 171. By July 16 of this year, there had been 108 bank robberies and, if prior years are any indication, there will be more robberies in the second half of 2008 than there were in the first.”
Look for this trend to roll forward throughout Cali in the coming months. Remember, SD is the canary in the coalmine.
My dad used to say that real estate prices in California move north via I-5
Un-backed, fiat, worthless rectangle shaped pieces of paper covered with green ink …is this what they’re after?
Lol.
But other times, they hide or vandalize the boats before they can be seized, said Megan McQuaide, the owner of Repo Yacht Sales in San Diego. She’s boarded boats with oil splashed around the cabin, engines intentionally overheated and feces on the deck.”
“‘Sometimes it’s really malicious stuff,’ she said.”
Nothing like a monster debt bubble implosion to bring out the very best in people. This stuff never ceases to amaze me. Do these poeple really think that vandalizing the boat is somehow going to “punish” the banksters or subprime broker who helped them into their crappy loans? The banks will just have to fix all the damage, submit an insurance claim, and then insurance costs go up for everyone.
Note to raga-aholic house & boat-repo vandals: if you really want to “punish” your bankster, go vandalize *his* f—ing yacht! Preferably while the sonafabitch is on it.
Ben has unearthed real estate stories from all over the world, but I only ever hear of this destructive mentality towards property happening in our country.
http://en.wikipedia.org/wiki/Argument_from_ignorance
If you really hate this country so much, why not just leave? You can go play with your gold, and talk about how happy you are to have left such a miserable place.
AMF
Bantering Bear,
You can love your country and hate what’s happening to it without being less of a patriot. There is an infantile and malicious spirit afoot in this country, no doubt about it, along with a pathological aversion to an essential societal virtue called “personal responsibility.” Making honest observations about what you see around you shouldn’t subject you to spurrious “Big V”-style defamation and histrionics.
Copy-and-paste jobs.
“Personal Responsibility”.
huh?
Sammy-
Thanks for the tutorial, but it’s not needed. I don’t see the “defamation and histrionics” in my post, so perhaps you could enlighten me. I’m usually a fan of your writings, but not this one.
Furthermore, there’s quite a difference between doomsday, end of the country extremism, and “honest observation”. I actually like Aladinsane, and many of his posts. I just get tired of people bashing this country repeatedly, and he seems to be stuck on that.
Besides, punish him for what? For letting you have a yacht for a year that you otherwise never would have had? These are the same people who will stalk their exes and threaten to kill them and stuff.
I don’t get this mentality at all. I don’t get vandalizing anything for any reason. It’s counterproductive, a waste of thought and energy, bad karma and just plain not right. Why can’t you be charged criminally? Until the bank takes it back procedurally, you are responsible whether you walk away or not - isn’t it like a car in that the bank holds the pink slip as lien holder? I don’t think you can just leave your car on the side of the road with the keys in it and when the bank tracks you down asking for payment just say you gave it back. Whether the homeowner did the damage or left without notifying the bank, I would think they would be responsible for the damage.
Because until it’s repossessed, it’s still your boat, and you’re allowed to do whatever you want to it.
The lender may be able to come after you for the loss in value due to your actions, I’m not sure about that, but that would require suing, which isn’t cheap, and given that you just had your boat repo’d, the bank is likely to end up in “getting blood out of a turnip” territory even if they win in court. I’m guessing that most of the time, they don’t bother.
–Shannon
“Q: Where is this market going? A: I think we’re at the bottom. We’re going to bounce around a little bit. We moved through the foreclosures. They’re being absorbed by the market. Inventory has been coming down so there’s not a huge inventory issue anymore. I believe we’re at the bottom.”
What an idiot. He didn’t see it coming, why would the Reporter ask him about his future expectations. Fire this Reporter!
“We moved through the foreclosures.”
That’s a bold statement.
We “moved” through 10% declines….
To the MOON!!
how about…
…we’ve made it partially through the fraud, we are now starting to work on the bogus prices brought on by the speculators and sleazy banks….
At least the guy is apparently getting boned by his ex-employer.
I wish some of these “foreclosure tour,” koolaid drinkers would list their lenders. I would short them directly instead of shorting the whole financial sector. Hugs and Kisses for Countrywide, Ambac, MBIA, and WaMu your stupidity has made my family very happy. Curses to the SEC for not being able to short below 4.
You better believe it, my family’s trip to Spain last spring was courtesy the idiotards at Fremont Lending!
Here’s a good read:
Socialist America, Part 2 … The Joker’s wild!
Solution: Cure Wall Street’s hangover with this 12-step intervention
http://www.marketwatch.com/news/story/socialist-america-part-2-jokers/story.aspx?guid={E24AFF20-4EB1-43FE-86D3-F9788815A7F5}&siteid=yahoomy
I know of a situation right now where a friend’s housekeeper is - through a Spanish speaking realtor - arranging a short sale with the lender, and the housekeeper’s son will be the buyer, for, of course, a huge amount less than what the mother owes. Wonder how much of that is going on. This is a low income area of LA.
Tons of it going on. I have a pretty close tie to the latino immigrant community. This happened repeatedly in the last downturn and it’s definitely starting up again.
The good that comes from this is the still lower comps that get set.
For some reason, I have no problem with this. Why? If the price was truly below market, the bank would re-posses and sell on the open market.
I just worry about the banks… I see on CR that MBS are pretty much dead and banks have to issue bonds they back. Oh boy… that means *traditional underwriting standards are just around the corner!*
That means pretty high down payments for any home more than the GSE’s will loan against.
Got Popcorn?
Neil
I’ve heard of this going on in Madera, except mother is buying at
short sale for daughter who had received a $250k loan. I think the
younger one makes $15 an hour. Don’t know if the ruse worked.
It doesn’t seem like a ruse, though. Anyone is free to buy the house at short sale, regardless of whether or not they’re related to the seller. I mean, now the daughter will probably pay rent to her mom, and the mom will probably hold it over her head until she finally gets fed up and leaves. People do stuff like that all the time.
And if it’s true, so what? They are different people and it’s a good way for a family to stay in the house. Hell, when my parents default I might step up and buy the house they live in straight cash so they can stay.
I personally don’t care, except that it’s a 100K to 200K loss for the banks, multiplied by thousands of households, and WE’RE PAYING FOR IT.
You can always surround the Whitehouse while carrying pitchforks and torches. You don’t have to bail out the banks.
Second the “lots goin on” sentiment. My BIL is in a situation where he’s gotten NOTs on his two houses (first one leveraged to buy his “palace” in the SGV). The scam is this: he pays a broker and lawyer some money to set up a living trust (with the broker being part of the trust) for the properties that are held in trust by the title co awaiting auction to stall the process. Supposedly this will tie the hands of the bank that’s ordering the auction and force them to deal with the parties in the trust. They claim to have an “investor” that will swoop in and take the properties off the bank’s hands for only a 50% haircut but they need a straw buyer to complete the transaction, of course.
They’re charging $10k+ for this, up front. I washed my hands of my BIL’s financial suicide when he jumped out the window of opportunity several years ago.
It works…seen it done before….
I’m not a lawyer so that’s all I have to say on it…
Not only do I think this is a pretty smart move, I think it borders on being admirable. I really do.
The mother and bank are taking the responsibility and absorbing the loss; the son is getting the home for a more reasonable price. If the mother lives in the son’s abode for several years, she’ll recover her losses more quickly.
Taxes are paid. The home remains occupied. The bank has one less foreclosed one for the books. Neighbors don’t have to see another empty house in the neighborhood.
Unike lots of U.S.-born foreclosees, this family seems to have a conscience.
As someone who is somewhat involved in the business of mortgage fraud prevention I can tell you that one of the checks when due dilligence is made on a loan is whether the transaction is “arms length” transaction. Under normal underwriting gudelines the situation you are describing would result in no loan approval for the buyer, short sale or not.
–
“Q: What keeps you up at night? A: I think there’s going to be a shortage of lots…”
The guy must dream about the coming shortage of lots “at night.” These morons in building industry don’t get it yet. There ARE 18.6M Vacant homes across the country:
Category……………… 2007Q2 2008Q2
..Vacant……………..….. 17,387 18,643
…Year-round vacant…. 13,057 13,864
….For rent……………… 3,731 4,008
….For sale only………… 2,037 2,169
There is no need to build for at least five years in 90% of the areas.
Jas
Nice jump in the number of rentals there. Good, a second “front” is needed.
Here’s an odd story from my neck of the woods….maybe DinOR will be amused.
There’s this ski resort called Tamarack whose two main partners are in bankruptcy. Now their new plan is to sell $670 million in bonds to shrewd investors in order to bail themselves out.
http://www.idahostatesman.com/newsupdates/story/454155.html
I’m not sure why anyone would buy such bonds.