Intelligent Risk Takers In California
The Press Democrat reports from California. “Exchange Bank’s top executive, J. Barrie Graham, resigned unexpectedly as president and chief executive officer of Sonoma County’s oldest and largest commercial bank. Exchange Bank has long been a key lender for local builders. But the real estate slump hit builders hard, and Exchange Bank has felt the blows.”
“‘I always like to say we’re intelligent risk takers. That may prove to be wrong now,’ said Exchange Bank’s veteran Chairman C. William Reinking.”
“‘It tells you a higher percentage of their loans are involved in construction. The bank made a lot of money on these loans. It was probably the most dynamic area of growth in their loan portfolio,’ said Fred Ptucha, investment adviser in Santa Rosa and longtime analyst of bank stocks. ‘With hindsight you could say they did go too far.’”
“Bank officials defended their lending standards and the decision to expand into the Sacramento area. ‘The speed at which this thing fell apart was just unheard of,’ Reinking said.”
From KGO TV. “For hundreds of people in desperate shape because of the mortgage mess, San Jose was the place to be Wednesday night. Homeowners from around the Bay Area came to get immediate help to avoid foreclosure and the turnout was overwhelming.”
“People were clamoring to get in. Lines stretched around the building. As many as 400 people converged at Independence High School in San Jose, all hoping to get out of their mortgage mess.”
“People with so-called liar loans, mortgages approved without proof of income or assets, are expected to be the next wave of homeowners to default. The Silicon Valley California Association of Mortgage Brokers does however, have some words of advice.”
“‘Work with your lender, don’t wait! Be persistent, lenders are overwhelmed with the number of people out there that are in foreclosure, that are in desperate and dire situations. If they say they’re going to call you and they don’t do it. Call them, continue to follow up,’ said Cathy Warshawsky, with the Silicon Valley California Association of Mortgage Brokers.”
“This is the first foreclosure prevention fair put on by the City of San Jose, but it likely won’t be the last. The night’s high turnout has prompted city officials to think about organizing another one.”
The Manteca Bulletin. “The average price of home deals closed in Manteca has dropped $1,584 a week since July 21. What is happening now are most banks aren’t messing around with the pricing of foreclosures that they put on the market. Most are deliberately under pricing them to attract between 15 and 18 offers within a week of listing them.”
“There were 42 price reductions in the week ending Aug. 11 as the group as a whole went from an original average of $299,052 down to $255,899. In the previous week ending Aug. 4, there were also 42 price reductions. That group’s average went from $246,373 down to $201,709. That is skewed quite a bit as most of the price reductions aren’t happening below $210,000. Instead, a number of country properties have seen reductions of $100,000 plus in the past two weeks.”
“Florsheim Homes CEO Joe Anfuso has indicated such news is welcome as it is a clear sign that the market is correcting itself.”
The Plumas County News. “(On Aug. 14) Jay Sabelman, president of the Plumas Realtors Association, spoke about the state of the housing economy in the Lake Almanor Basin and told members of the Rotary Club of Chester that although ‘volume is down and sales are down, there are tremendous values out there in the real estate market today.’”
“He said there are 275 homes for sale at this time in the Lake Almanor Basin. Continuing, he said 29 homes were sold between January 2008 and now; 55 homes were sold during the same period in 2007.”
“Responding to general questions Sabelman said the median price of sales outside Chester ranged from $420,000-$520,000. When asked about local home losses he said, ‘Westwood is a very prevalent foreclosure market.’”
“‘Last winter was very tough on association members. We have 200 Realtor members in Plumas County and probably 60-70 in our area who are fighting to keep their heads above water,’ he said.”
The Monterey County Herald. “Home sales in Monterey County continue to rise, while the median price of sales continues its downward trend, according to a real estate research firm. Compared to July 2007, the number of sales for new and resale properties, including single-family detached residences and condominiums, was up 53.5 percent…according to MDA DataQuick.”
“The median sales price was down 44.1 percent year to year, dropping $242,000 in the past year from $549,000 in July 2007 to $307,000.”
“DataQuick president John Walsh said the sales increases don’t necessarily point to a sustainable rebound in the housing industry. ‘A clearer picture of the entire housing market will emerge once more of these foreclosures burn off, and more lenders, sellers and buyers get off the sidelines and back into the housing game,’ he said.”
The Grunion Gazette. “In less than a year, roughly 408,000 square feet of industrial and office buildings on about 22 acres of land at Douglas Park are expected to be completed and ready for leasing.”
“Newcastle Partners, Inc., started construction on the land next to the Long Beach Airport this June. Original plans for the Douglas Park site also included residential housing. The most recent plan proposed 1,400 residential units (town homes and condominiums). However, the Planning Commission on July 17 approved a revised plan that eliminates the residential component of the project altogether.”
The Glendale News Press. “Economic factors have created a deep funk in sales along Glendale’s Brand Boulevard of Cars, mirroring a national downturn in automobile purchases as customers continue to feel the pinch of an enduring housing slump, a pervasive credit crunch and soaring gasoline prices, officials said.”
“Sales of new cars in Los Angeles County plunged more than 18.6% from January to March as dealerships along Brand Boulevard have been feeling the pinch of sparse customers and decreased revenue.”
“New car sales at Star Ford are down 20% from last year, said Alex Tamez, director of operations. ‘It hasn’t been great. Foreclosures have affected us. The banks that had financed homes finance cars. Now, [banks] are looking deeper. It’s harder to get people approved.’”
“Business at the Ford service department has slowed because of frugal customer spending habits. ‘They used to say, ‘Do whatever needs to be done.’ Tamez said. ‘Now, people are saying, ‘Do I really need to change my air filter, do I really need to inflate my tires each time?’”
The LA Times. “Noontime shopping sprees at the mall for Pam Lewellen of San Clemente are decidedly less expensive than they used to be. These days, she says, ‘I am constantly looking for that deal.’”
“High gasoline prices and nagging uncertainty about the economy haven’t stopped her from prowling malls for fun, but she said they have pushed her away from her favorite department stores and boutiques to discounters such as Ross Dress for Less and Marshalls.”
“Particularly hard hit are owners of shopping centers and buildings that house businesses serving new homeowners such as furniture stores and electronics warehouses. Also taking a hit are upscale department stores and other shops that have traditionally drawn the middle-income consumer.”
“Times are definitely challenging for many stores and malls, according to the International Council of Shopping Centers. ‘For years the market strength was in luxury,’ said Michael P. Niemira, chief economist for the council. ‘Now it’s Wal-Mart.’”
The Union Tribune. “When he took out a $206,000 home-equity line of credit in 2007, Kevin Hall thought he’d secured all the funding he’d ever need for a major remodeling project at his Carlsbad home. That’s why his heart skipped a beat when he went online in February to transfer money from his account.”
‘He discovered that his credit line had been slashed to $72,000. Formal notification wouldn’t arrive in the mail for several weeks.”
“‘I got sucker-punched on the thing,’ said Hall, who manages a ReMax real estate office in La Jolla. ‘I was at the point in construction where the drywall was going up. I was flabbergasted.’”
“Like thousands of borrowers, Hall was a victim of falling real estate values. In Washington Mutual’s judgment, the home equity used to secure the credit line had significantly declined. And under the terms of the agreement, the bank had the right to pull the plug.”
“Washington Mutual isn’t alone in reducing its exposure to risk in regions where home prices are falling, including San Diego County.”
“‘It is widespread everywhere there was a significant run-up in home values, followed by a sharp correction,’ said Dustin Hobbs, spokesman for the California Mortgage Bankers Association.”
“Mark Goldman, a real estate finance instructor at San Diego State University, said it makes no sense for banks to notify borrowers before they reduce their line of credit.”
“‘Of course they aren’t going to call you up and say we’re taking a look at your loan,’ he said. ‘The borrower, upon receiving that notice, would likely draw down the remaining available balance on the home-equity line.’”
“Hall said the experience has left him feeling bitter. ‘We had to scramble,’ he said. ‘We were definitely robbing Peter to pay Paul. We didn’t want to run up our credit card, but that was the best solution at the time.’”
“Lenders could have avoided the problem by using tighter underwriting standards when home prices soared, said Dean Baker, an economist for the Center for Economic and Policy Research in Washington, D.C. Like many consumers, they gambled that home values would continue to rise and now they’re paying the price.”
“‘It would have been good if they had been this cautious five years ago,’ Baker said.”
The Merced Sun Star. “Five foreclosed homes at the end of El Rodebaugh Street serve as a breeding ground for wasps that zigzag over the entire neighborhood. One of those abandoned properties at 2021 Oak Grove Way has six visible nests along the fence in the backyard.”
“Randy Fagundes of Fagundes Custom Yard Care was on the scene cleaning up the abandoned home for sale. He says the source of the insect problem is simple: ‘I think this is a foreclosure problem. I’ve never seen anything like this. But then again, I’ve never seen so many foreclosures.’”
“Julia Mercado says the wasps dictate when they mow their lawns, when they can take a dip in their swimming pool and what times they let their daughter play outside.”
“‘We go through a can of wasp spray every day. It’s an epidemic,’ she shrugged.”
“At least one man who’s been proactive in dealing with the pests is Realtor Don Scorby. Scorby, who’s trying to get one of the foreclosed homes ready for sale, has gone out twice in the past week to spray the nests that litter the property.”
“‘I feel like I am representing the bank and I should take care of it,’ Scorby says. ‘You can’t show a home when there’s wasps.’”
“But will the banks or real estate agents at the other homes step up? Alan Inman, manager of the Merced County Mosquito Abatement District says the problem is the same as the mosquitoes in pools of foreclosed homes, where the county has received varying degrees of cooperation.”
The Daily Breeze. “Rep. Laura Richardson caught a break on Wednesday when code enforcement officers decided not to bill her for boarding up the garage door on her vacant Sacramento home. The city decided it would be too much trouble to determine who owned the property last month, when code enforcement officers were called out to deal with a ‘public nuisance.’”
“After Richardson stopped making payments on the home, it was sold to an investor at a foreclosure auction. But the property was returned to Richardson in June, after her bank rescinded the sale.”
“In a statement, Richardson disavowed any responsibility for the current upkeep of the home, because she said it still has not been transferred back to her.”
“‘Congresswoman Richardson is fully prepared, WHEN full transfer of the property is made and reinstated, to manage and maintain the Sacramento property,’ said her spokesman, William Marshall.”
“Richardson’s statement conflicts with available public records, which state that she has had the title to the property since June 2.”
“Sacramento police were called to the home on July 21 because the garage door was open, suggesting a possible break-in. The police called code enforcement officials, who brought in a contractor to board up the door.”
“Code enforcement officers also found rotting food on the ground, which might attract rodents, as well as junk and debris in the yard.”
“In another development, Washington Mutual paid Richardson’s outstanding property tax bill of $9,000 on July 31. No public records explain why the bank would do that, though it is possible that the tax bill was added to Richardson’s loan balance in a refinancing.”
“‘I feel like I am representing the bank and I should take care of it,’ Scorby says. ‘You can’t show a home when there’s wasps.’”
Yeah, those White Anglo-Saxon Protestants really get in the way sometimes. However, I don’t think racial and religious profiling when showing homes is lawful. We’re talking about people, right?
“‘I feel like I am representing the bank and I should take care of it,’ Scorby says. ‘You can’t show a home when there’s wasps.’”
Oh Bee have…
How do you catch a uniqe rabbit?
U nique up on it.
How do you catch a tame rabbit?
The tame way.
How do you catch a polar bear?
First dig an ice hole. Then put a whole bunch of little green peas on the outside, and when the polar bear comes to take a pee you kick him in the ice hole.
I audibly snorted, Hoz.
“‘I always like to say we’re intelligent risk takers. That may prove to be wrong now,’ said Exchange Bank’s veteran Chairman C. William Reinking.”
HaHaHa!! Whooo, that’s a good one! More like what happened was, “everyone else was doing it, so we thought it’d be okay for us to do it, too.”
Groupthink - the hallmark of our Ivy League colleges. Pay someone $5 million salary to do the same thing everyone else is doing.
Groupsink
Groupstink — the hallmark of the American management mentality. Gladhandling dumbass arrogant mental mediocrities, from here to the White House.
You could say that the Japanese Kamikase sucide pilots of WWll were intelligent risk takers too.
Well, at least they weren’t trying to Fly Houses on their Suicide Missions
Not to mention, they weren’t just gambling with OPM. They were risking something valuable of their own: their lives.
Hard to say they were risking anything when they already knew the outcome.
rob
Chairman C. William Re-inking is re-thinking.
“‘I got sucker-punched on the thing,’ said Hall, who manages a ReMax real estate office in La Jolla. ‘I was at the point in construction where the drywall was going up. I was flabbergasted.’”
The guy works in real estate, but had not yet heard about HELOCs getting pulled or reduced? Sure. Good job keeping up with lending and borrowing trends, you must run a tight ship over there in La Jolla. Put down that glass of chardonnay so you can smell the rotting housing carcass next to you.
I’d like to see this goof spend a day on a drywalling crew. He’d quickly find out what WORK is all about.
…but isn’t all that being done by “illegals” who are costing us billions..?
You implicitly raise an interesting question, perhaps it might be a weekend topic, to wit, would the implications of housing crash on U.S. economic healtth be as bad as it is going to be if native born workers had been doing the construction work? I am not sure. Part of me thinks no, because native born workers would not have been sending dollars to Mexico. Thus, more money might have stayed here, and thus part of the economic output might’ve actually produced something of value.
On the other hand, the costs would’ve been higher, which might’ve just drove even more outrageous lending.
I’m sure there’s more variables to consider. But, which way it balances in the end, I’m not sure.
IAT
Part of me thinks no, because native born workers would not have been sending dollars to Mexico.
True, they would have sent the dollars to China instead, via WalMart and other retailers.
RE: I’d like to see this goof spend a day on a drywalling crew.
Damn right a tough job…hauling, hoistin’, the glop, the mess…plus one slip of that cuttin’ knife and you’ll be out a couple of digits.
I remember the head of the crew doin’ the work on my last house, coming to me with a glum face saying my young daughter (out of curiosity) had run her finger up and down in a number of corners before the joint compound had set.
My apologies were profusive.
You’re missing the point, friar john. He was *entitled* to that HELOC. It was supposed to be *his* cheap money to do with as he pleased. Now, just ‘cuz like half the transactions in his neighborhood happen to be FCs and the lenders are failing left and right, his bank has the nerve to go and turn off Mr Realturd’s Magick Money Spigot.
No fair! MOMMEEEEEEE!!!
HARM,
And did you SEE that freefall!? Wow, from over 200k to ‘just’ 72k. I’m sorry but I’m seriously doubting ‘all’ of that 200+ was for the ‘remodel’? More likely Kev read there ‘might’ be a slowdown in RE and was tapping it to tide himself over so he had to scramble for a ‘project’ to justify the HELOC?
Hope you had a great trip to the Rose City! Sorry we missed you.
DinOR,
100% agree, I doubt even half the money was for the remodel. I bet we just found a Realtor who’s entertaining budged was cut dramatically.
Traditionally, Cash out refinancing has shown an elevated default rate. I wonder if HELOC’s will go to almost pure ‘hard money’ for a few years. Note: I wonder… this isn’t a prediction… yet.
We’ll see further tightening this Fall and the mother of all credit crisis in the Spring. Its too late to slow it down.
Got Popcorn?
Neil
wife’s/GF’s boob job = “capital improvements”
hair transplant = “new roof”
Brazilian wax = “landscaping”
new fully loaded H3 = “appliance upgrade”
“100% agree, I doubt even half the money was for the remodel. I bet we just found a Realtor who’s entertaining budged was cut dramatically.”
His income stream is from an industry in free fall and he’s spending money on home renovations? Something’s not right here. He’s either oblivious to what’s happening in his own industry and the closely linked financial industry, or at least some of the money was going somewhere other than to home renovations.
Neil,
HARM nails it more effectively than I ever could. Again I’m leaning toward this being “an inside job” as he still probably has/”had” plenty of connections in the biz.
I can’t think of (1) market in this country where anyone else would have been able to get a loan of that magnitude at this stage of the game? Sounds pretty wreckless to me. Oh and next time Kev… make sure you have a check in hand before you go tearing walls down..?
He’s triple-effed IMO. 1, he’s in real estate. 2, he’s “improving” his depreciating “investment.” 3, he just got the HELOC rug pulled out from under him. Come to think about it, number 3 is a blessing in disguise.
DinOR,
Had a great time in Portland -thanks. Hope to see you on the next visit.
HARM,
Outstanding! ( I’m just glad you didn’t schedule for this week as it’s been a real stinker ) A solid week of rain in… August? Seattle, sure but here!?
We’ll he did find a sucker bank to give him money.
“The couple saved their home improvement project by securing a $150,000 line of credit from U.S. Bank.”
There’s still money to squeeze off the banks. I’m sure the rate was pretty high but “who cares” right? All else fails they can walk away. Maybe they finally realized if they take out 72,000 + $150,000=$222K they can take the money and run while the house is mortgaged to the MAX. Maybe these RE’s are smarter than we think.
US Bank is supposed to be one of the safe, “fortress” banks.
Bwa. Ha.
If the bank found out he worked for an RE company, they should have cut his HELOC to zero.
The bankers are no different from the flippers. They were looking for instant gratification and quarterly bonuses instead of looking out for the best interests of the bank. The BOD’s are full of connected morons, so don’t expect any oversight from them.
Bankers/lenders are missing their “easy money” when customers came into their offices with their billfolds in their mouths. O, those were the good old days!
“Business at the Ford service department has slowed because of frugal customer spending habits. ‘They used to say, ‘Do whatever needs to be done.’ Tamez said. ‘Now, people are saying, ‘Do I really need to change my air filter, do I really need to inflate my tires each time?
———————
Are people so lazy and incompetent that they can’t inflate their tires by themselves, but must go to a service department and pay someone else to do it, let alone change an air filter?
Maybe the Obama energy plan - “Inflate your tires” - is a good idea after all, but of course there will need to be tax credits so that the “poor and disadvantaged” can afford to pay someone else to do it for them!
Many people don’t have time to do those things themselves. They’re too busy working butt-busting hours to pay the mortages on houses they couldn’t afford in the first place.
Agreed on both accounts above but when you change your own air filters etc. THEN we’ll call you “frugal”.
Why doesn’t everyone just get a K&N or similar filter with eavery new car. They last 2-3 times as long, cost 2-3 times as much, but mine increased my mileage 10% on the Suburban.
I often wonder why big automakers would fail to use any type of filter that could increase economy by 10%? I mean hey they employ some pretty decent engineers and one would have to think that they tried the filter test a time or two??
I’ll also state that when I put a BHTF (big honkin’ truck filter) on my Dodge Ram diesel I got a similar increase. In that case it’s all about increasing the filter media area. I went from about 130 sqin. to about 360 sqin. of filter area. An internal combustion engine is best thought of as an air pump, in terms of efficiency, and anything one can do to increase flow and decrease turbulence in said flow will give return in HP.
I think it would be safe to say that it is a cost issue for the manufacturer. You must remember that a 10% increase in mileage is actually due to a similar increase in HP and a resultant decrease in RPM needed to maintain a given speed. If I increase an engine’s HP 10% then I need to beef up my transmission, suspension, etc. to compensate or Retardo Montelban is going to blow something up real good and come back at me for warranty repairs.
I think I most certainly voided my warranty in the case of the BHTF, btu what can I say? I like to live dangerously.
Which of you is the K&N rep? 10%? Hmmmm…
LOL!
Not me man, I’m just an unbelieveably warped penny pincher.
You want another story? A freind of mine recently put a supercharger on his ‘05 Mustang GT. He is now running in the 12sec. range in the 1/4 mile. How did this affect his gas mileage? He went from 14 city to nearly 18 city because he can only accelerate for about 1 second before he hits the speed limit. The rest of the time he’s just coasting around town.
I heard of one guy who put a jet engine in his volvo. Went from 18mpg to infinity because I am full of crap.
I would venture to say a lot of people don’t even know HOW to inflate their tires.
If more air is getting through your K & N then so is more dirt. There is no free lunch.
“You may opt for a free-flowing, low-restriction filter. But this decision usually begets poor filtration ability, sacrificing clean air for horsepower. The downside may be shortened engine life due to dirt and grit getting into the engine.”
http://www.stockcarracing.com/techarticles/scrp_0703_air_filter_selection/index.html
Whats a tire?
Tell that to my 5.7 liter Suburban. 250K miles and going strong. (knocks on wood)
Also, part of the advantage of K&N and the big truck filters is added area of filter media as I noted above.
My dad taught all of us kids how to check air pressure, water in radiator, and level of oil. We had to check them before we could drive his car. If any of them were low, we would fill them. Somehow he never had to do this himself.
That’s fantastic. Could you come around and check mine?
Hah, that’s what my neighbor did too and he never changed a flat tire either.
“Business at the Ford service department has slowed because of frugal customer spending habits. ”
I love it because I added to their stats last week. I took my son’s vehicle into the dealership for its scheduled maintenance 30K maintenance (free) and came out with a list of repairs not covered but needed. I told them that I’m an old man on a budget (they thought the car was mine) and that I needed several months to save up the money to make the repairs. Their cost for the repairs was approx. 1K. To do the breaks was $75 dollars, my cost, the trany $85 dollars (filter, fluid, time), fuze for equipment outlet $0.40, clean injector box, $2.50, plus other minor items.
The stealerships are in the biz of selling a lot of needless crap. It’s hard enough finding an independent honest mechanic, but I’d say damn near impossible finding an honest dealer service rep.
It’s pretty hard to find honest repairmen too. They are pressured to sell you a new airconditioner or some expensive part. My BIL repairs heating, airconditioning, refrigerators and solar. Most companies he has worked for were never pleased with his honesty. I can’t tell you how many times he has looked at an airconditioner after a repairman has said it needed expensive repairs and found that it was a simple cheap repair.
I wasn’t aware that the Ford service center was charging extra to put air in your tires along with your maintenance job. Toyota does that for free. I like Toyota, sorry guys.
Such weasels. Took my truck in awhile ago to dealer, who diagnosed a faulty fuel injection sensor or something like that, 600 some bucks to replace. I called same dealer’s parts dept and found the part sold for 120 bucks. And the parts guy told me o yeah, it’s easy to replace, right on top of the engine, 2 bolts and a 3-wire plug.
thanks buddy.
No wonder Big 3 are going broke. Bad karma to treat customers that way. But modern America in microcosm pretty much.
It’s the flag hours to repair deal. Not saying your sensor should have been $600 installed, that’s a little crazy. Same as the Cam position sensor on my Powerstroke diesel, service writer wanted 120 for the sensor and 150 to install. I told them about an updated replacement number that was $35 for the sensor and the writer told me I was wrong. Did same thing as you. I walked to parts counter asked about the two numbers, got confirmation, $35 sensor and 20 minutes later, sensor installed.
I have a friend that makes or was making anywhere in the area of 150-200K as a mechanic. ex. He has a repair job that the book says takes 3 hours and he can get it done in 1-1.5 hours. He got to cherry pick the jobs he wanted as well, high flag/low actual. Plus, whenever working on a car/truck that was under warranty, if he saw ANYTHING that may need replacing, he’d get it done and bill it, easy money.
How people can’t check air pressure in their own tires is laughable. Talk about a very simple procedure.
Depends on the car model, a lot of these newer cars are not the friendliest for the home mechanic… Wasn’t there a newer Chrysler that required you to pull a wheel to change the oil?
There apparently was at least one muscle car where you needed to disconnect one of the motor mounts and lift the engine partly out of the car to change the spark plugs on one side.
“Business at the Ford service department…”
Just in case ‘ya didn’t know any better… the guy at the service department of all the dealerships who writes-up the work-order collects a percentage of the work-order. Real bottom-feeder, lying, verminous scum!
“People with so-called liar loans, mortgages approved without proof of income or assets, are expected to be the next wave of homeowners to default.”
And how in hell are you supposed to be able to help these people?
*Bueller?*
*Bueller?*
I will state it again:
For many of these buyers, they had two options:
1. Sell at a profit when they could, or
2. Foreclose.
No other options are/were available.
3. Stop paying mortgage and continue to live in house for free, while mortgage servicer searches for (and can’t find) current title-holder on securitized mortgage that has changed hands and been CDO sliced-’n-diced 20+ times since the loan was originated.
4. Get wheelchair, IV drip & 10 orphans to pose as one’s “extended family”. Go wait outside county courthouse for reporters to show up, then present B.S. sob story about how one was a “victim” of evil, nasty loan peddlers that are threatening to throw the “little ones” out on the street. Wait for sob story to air, petition Congresscritter for “special consideration”, then wait for favorable loan-mod to come in the mail.
“Good news, Mr. Strawberry Picker! We re-negotiated the interest on your $600,000 loan from a variable APR that’s at 8.75 right now, down to a 30 year fixed at 6.5! The payments on your home (which is worth $425,000 right now and dropping in value by the hour) will go from $6,500 a month to $5,500! What do you think? Hello. . . Hello? Are you still there?”
Yo? Hey…Paddy. I’m in Mexico right now enjoying my own home that I bought with that $200k HELOC you gave me. Thanks a million!
“Times are definitely challenging for many stores and malls, according to the International Council of Shopping Centers. ‘For years the market strength was in luxury,’ said Michael P. Niemira, chief economist for the council. ‘Now it’s Wal-Mart.’”
I hear Wal-Mart has a new ad campaign coming out. Their new motto is “Wal-Mart, the only luxury you can afford.”
The ICSC upgraded their recent forecast to reflect 144,000 retail stores closing (IIRC), but no timeline given. That’s telling, but no one pays attention. That shouts the “D” word to me.
What’s worse is that many of these stores are exhausting any reserve they might have, or amassing huge new debts, in a vain struggle to try to outlast this.
So, when they go, they’re going to go quick - straight to liquidation. Boosters say those that have gone under already were the weak ones - of course, the weak links always fail first - that’s certainly no evidence to support a bottom.
General Growth Properties, a major competitor to Westfield “Shoppingtown”‘, has been rumored to be struggling. What this retail cleansing is going to do to retail developers has been long over due. If 2-3 anchor tenants forfeit their lease, that is a big hit on cash flow and foot traffic X the # of centers.
awaiting wipeout,
What we really need is a 2000’s version of ‘Susan Powter’ to “stop the insanity” of filling every vacant moment in your life w/ shopping. Even at the height of the re-fi/cash-out orgy I STILL recall going past plenty of malls that had plenty of parking.
Note to self: You can’t spend your way into prosperity.
My many years in the shopping center biz was fun, but I never connected to the consumption culture. Shopping fills voids in lost souls. I did learn about color psychology, visual & spacial perception, and all the tricks that get the consumer to open their wallets. There is even a guru who calls himself a “retail anthopologist”. He is actually a pretty bright guy.
When people call the overpriced retailer nuts, I always reply, it’s the customer who pays it that’s nuts. The retailer is smart.
I think WalMart could have a new strategy: open a store on every corner, even across the street from other WalMarts! Who cares if they cannibalize each other’s sales; we’re interested in rapid customer turnaround and knocking the little guy out of business.
I think I read that this country already has something like 20 square feet of retail space for every man, woman, and child. Which implies that we’re already over-stored.
Time for some thinning of the retail herd…
I think your number is low. My local superwalmart is easily 90,000 sq.ft. There are 2 in Palmdale. Palmdale only has about 150,000 residents, so Walmart alone has 1.2 sq.ft. per resident.
Then start adding up the targets, the home depots, the lowes, the mall, the etc…
I have 4, count em, 4 friggen Target supercenters within driving range of 15 min or less. There is way way way too much retail space that has been built over the years. Of course the city of San Jose welcomes the tax dollars every new store generates but my god every shopping center now has the exact same boring stores and food courts and god forbid a Starbux.
Yep, there are way to many retailers and centers. The amount of LLP’s and LLC’s is staggering in the shopping center biz. Everybody jumped on the bandwagon.
Some retailers are smart, like Burlington Coat Factory. They space out their stores (which carry deep discounted better mdse) and get the biggest bang of their demographics. They stayed pretty lien, while other retailers opened too many stores.
I also think modern strip malls and neighborhood centers in older neighborhoods don’t fit in. Not every neighborhood needs a stucco village shopping center. Charming, their not.
Regarding tax revenue, oversatuation is not going to increase $ into the coffer.
I personally would like to see less spending and more long term planning in this country. $55T in unfunded Boomer Medicare & SS, and is anyone paying attention?
“Rep. Laura Richardson caught a break on Wednesday when code enforcement officers decided not to bill her for boarding up the garage door on her vacant Sacramento home. The city decided it would be too much trouble to determine who owned the property last month, when code enforcement officers were called out to deal with a ‘public nuisance.’”
I guess technically speaking, cities don’t read newspapers, so it would have been hard for the city to figure out who owned this property.
Professor,
LOL! Yeah that would be asking a lot. If you need a real chuckle Michelle Malkin has been covering since this story’s inception. She makes a lot of the same kind of observations. Too funny, oh and she wanted to champion all kinds of bail-out bills. You’ll find this Rep. has had payment problems long before there was a boom OR a bust!
The code enforcement department would have had to communicate with the clerk & recorder’s department - way too hard. At a given time there is always an owner of record.
The stink on her isn’t coming off…
aladinsane,
Try as she might. And it’s not easy following this story either. It covers at least a decade and residences ( including her mother’s ) from Long Beach, CA to the capitol and all points in between? She’s just weird. Given she makes like 3 X the avg. CA’n what makes her think she’s ‘connecting’ to the everyman?
WaMu is sucking up to the Demoncrats again. They want to make sure they get a bail out re: Bear Sterns. ‘Laura, please don’t tell on us to the head master, Pelosi’.
When was the last time we had a politician actually defined as a ‘public nuisance’…
How cool is that?
When was the last time we had a politician actually defined as a ‘public nuisance’…
Lately, I can’t think of a better name for them without envoking the “Spirit of George Carlin” and borrowing a few of his choice words
Mikey-
Carlin was a master of the English language. His interview on NPR was great. His mother was in advertising, and he just finished 9th grade. No college, but Latin class early on. He studied electronics in the military. The guy was bright. He wrote out a life plan as a teen and lived it.I’m a huge fan.
Rep. Richardson, Mayor Barry, Mayor Kwame… We could cure the energy crisis by attaching magnets to Dr. King’s feet and let him power a dynamo as he spins in his grave..
What’s amazing is the scope of how this real estate bubble is taking down banks thought to have been unfazed by it, until most recently.
This bank was old, worldly and wise in people’s eyes…
=========================================
“Exchange Bank’s top executive, J. Barrie Graham, resigned unexpectedly as president and chief executive officer of Sonoma County’s oldest and largest commercial bank. Exchange Bank has long been a key lender for local builders. But the real estate slump hit builders hard, and Exchange Bank has felt the blows.”
“‘I always like to say we’re intelligent risk takers. That may prove to be wrong now,’ said Exchange Bank’s veteran Chairman C. William Reinking.”
We have 200 Realtor members in Plumas County and probably 60-70 in our area who are fighting to keep their heads above water,’ he said.”
“Funeral for a Flood” on these used-house realtards? Hope they lose the fight and drown.
“fighting to keep their heads above water”
Q: How do you stop a realtor from drowning?
A: Take your foot off their head.
Q: How do you keep a realtard from drowning?
A: Tell him/her to sit up in the bathtub.
‘Q: How do you keep a realtard from drowning?’
A: Why would you want to?
Nice.
Right. Wait ’till he comes to take a pee, then kick him in the ice hole (reference hoz joke, above).
If you could either save a realtor drowning in a river or take a Pulitzer prize-winning photo of them drowning, which aperture setting would you use?
LOL I like that one
How many realtors does it take to shingle a roof?
It depends upon how thinly you slice them.
“‘I feel like I am representing the bank and I should take care of it,’ Scorby says. ‘You can’t show a home when there’s wasps.’”
Real estate will sting your a$$! Stay away from it!
Men once fought Indians and Mexicans for control of that land. Who are these pansies that get pushed around by wasps?
Declaration of Independence, 2008 style
“People were clamoring to get in. Lines stretched around the building. As many as 400 people converged at Independence High School in San Jose, all hoping to get out of their mortgage mess.”
Give me your tired, weak, longing to be free…
SCREW the the FDIC and these frigging Taxpayer bailouts.
They should just bus in a load of FDA inspectors and butchers to these banks on Friday nights and make Monday morning lamb chops out of all of these SHEEPLE !
Ooops…sorry Ben, my sympathetic, sensitive side just busted through again
I got this picture in my mind of flags, a realtwhore, and signs that say “only 2 left.”
‘The speed at which this thing fell apart was just unheard of,’ Reinking said.’
There it is again, the “crash” theme. This will become the most popular excuse for politicans and bankers alike before this is over…just like G.D. I
At the time I recognized this bubble for what it was I was working a full time engineering job, running a small business, serving in volunteer capacity as a LDS bishop, and helping 5 kids in school with homework.
If anyone has an excuse for missing the crash that was to come it was me, and many like me. Anyone involved in financial endeavours as a full time job should be sacked AND caned for missing this.
I just realized my “caned” could easily be read as “canned” Make no mistake, I meant “caned”.
Rage on, dude. That’s an awesome perspective/comment!
Come on ChiTown hustler, this is standard cover your ass BS.
As Mark Twain wrote, “Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself.”
Thanks hoz, for that post on LaSalle/B.o.A. earlier today. Where’d you find that info? Local press doesn’t have anything on that yet.
Local press is no longer local. All companies are required to file Mass Actions with the state. Newspapers for whatever reason stopped carrying it. (Probably because states charge a few pesos for the info) But I am pretty sure the BofA is old news, just ignored.
e.g. Announce that there will be 10,000 layoffs in 6 months, news reports it. In 6 months its old news and will not be reported by the press. The press announcement usually reads “As previously announced, blah blah blah..” Papers skip it and there is no uproar. Typical PR.
‘the speed at which prices rocketed up was just unheard of,’ I SAID.
Don’t people get that the run up was just as rapid and without precedent than the crash?
“‘Work with your lender, don’t wait! Be persistent, lenders are overwhelmed with the number of people out there that are in foreclosure, that are in desperate and dire situations. If they say they’re going to call you and they don’t do it. Call them, continue to follow up,’ said Cathy
Hey Cathy. What about this advice. PAY YOUR FRIGG ”’ BILL AND THEN THE LENDERS WILL LEAVE THEM ALONE. Oh, they don’t want to pay, or didn’t know the terms? Well, why didn’t they READ AND UNDERSTAND the d@mn papers before signing the papers. Or pay an attorney $200 to explain it to them (independent party). Oh, I am sorry. THEY WERE TOO GREEDY AND EXPECTED FOREVER APPRECIATION THAT WOULD MAKE THEM MILLIONAIRES. NOW THEY ARE THE BAG HOLDERS AND WANT TO MAKE SOMEONE ELSE RESPONSIBLE FOR THEIR BAD GAMBLE. SAME AS THE DWI ADDS. BUT HERE. YOU BUY. YOU DON’T READ AND UNDERSTAND. YOU LOSE. GET OUT. GOODBYE (hey Weakest Link is back).
Ok. Put down the capitals and back away slowly.
Want a cookie…glass of milk?
That I agree with you is not important.
“Newcastle Partners, Inc., started construction on the land next to the Long Beach Airport this June. Original plans for the Douglas Park site also included residential housing. The most recent plan proposed 1,400 residential units (town homes and condominiums). However, the Planning Commission on July 17 approved a revised plan that eliminates the residential component of the project altogether.”
————————————————————–
Can they abort this, so late in term?
Call it a partial birth development.
I wonder how much additional vacant commercial space this will add to the growing pile?
I must imagine that the nixed residential will be filled in with more commercial, no?
It looks as if KB Homes has stopped contruction on a new development at Stearns and Redondo in Signal Hill/ Long Beach. The roads are in but no work being done.
Signal Hill will implode in price since most of the sales have been new developments completed in the last 5 years. Homes are closing at 2002-2003 prices.
Nice Haircut!
They stopped a project out here in queen creek too.It was called sentiero.Big asses house fit for kings.They have shut down and even sold the original models.
I noticed this too- I live on the other side of the hill. Have you seen the 2 vacant homes up near the top of Hill street from this development? They’ve been empty for 5 years.
The two homes at Hill and Temple in Signal Hill were completed and sold in foreclosure. The homes cannot get a variance for the garages.
oops!
Nice Haircut
I work at this airport- there is NOTHING going on construction wise on this project. They still don’t have all the old Douglas buildings torn down yet- I’ll be surprised if this happens at all. Tons of vacant commercial in Signal Hill right now- I can’t see them leasing out expensive new buildings. If Long Beach was smart (they’re not) they would expand the airport and terminal and really bring in some business. The only competiton is Orange county and LAX, both at capacity right now.
The residential is later phases. There was never intended to be residential in the first phases. Newcastle is not a residential builder.
To my understanding the Douglas Park (all phases) is supposed to be spread out over a couple of decades. In short term, there could be slow leasing, but over the long run, the project will be just fine.
“‘Work with your lender, don’t wait! Be persistent, lenders are overwhelmed with the number of people out there that are in foreclosure, that are in desperate and dire situations. If they say they’re going to call you and they don’t do it. Call them, continue to follow up,’ said Cathy Warshawsky, with the Silicon Valley California Association of Mortgage Brokers.”
-In other words: ” You guys are screwed, sorry!”
Well look at it this way…
With no job to pay the mortgage, they can spend the 2 hours waiting on hold only to be told they dialed the wrong dept., “I’ll transfer you now”, for another 2 hour wait. At which point they get a full VM box, someone that speaks broken english, or a message that volume of calls are too high call back later…
Which reinforces jetson_boy’s premise: “You guys are screwed, sorry!” It just will take 4+ hours to get the message, then one that funny voice keeps saying in the back of their mind, endlessly, until they throw the keys on the roof and the smart thing, RENT!
LOL!
FB “Can you help me? my mortgage payment is $4K but my take home pay is only $3K. Can you lower my mortgage payment to $1K and lower the principle too?”
Bank: “aaahhhh”
FB ” It’s the law right?, they passed that bill right? you have to do it?”
Bank: ” aaaah,…..security!?”
Well right, that and the fact that it was the MB’s that filled the seats in that high school to begin with! Kind of like going to Andy Dick for ‘drug counseling’ don’t you think?
Cities like Glendale (originally named Tropico, for those of you scoring @ home) had oh so many new car dealers, because of the potential of collecting sales tax on high-ticket items, and a decent part of their operating budget was based upon this steady stream not drying up, but there’s a money drought going on…
========================================
“Economic factors have created a deep funk in sales along Glendale’s Brand Boulevard of Cars, mirroring a national downturn in automobile purchases as customers continue to feel the pinch of an enduring housing slump, a pervasive credit crunch and soaring gasoline prices, officials said.”
Here in Tucson, the bicycle shops are doing a gangbusters business. This is unusual, because the summer is usually the slowwwww time in the bike trade.
Here in San Jose we’ve had increased sales of new motorcycles and a lot of old motorcycles have come out of garage storage. Vespa and like kind scooters are sold out.
There has been a significant increase in motorcycle fatalities in So. Cal in the last five months. Coincidence ? i don’t think so.
“Deep Funk”
New type of music - The anger and intesity of slam metal combined with the spirit and pizzaz of disco.
“Noontime shopping sprees at the mall for Pam Lewellen of San Clemente are decidedly less expensive than they used to be. These days, she says, ‘I am constantly looking for that deal.’”
“High gasoline prices and nagging uncertainty about the economy haven’t stopped her from prowling malls for fun, but she said they have pushed her away from her favorite department stores and boutiques to discounters such as Ross Dress for Less and Marshalls.”
I have never understood this addiction to shopping.
‘I have never understood this addiction to shopping.’
It’s not an addiction, it’s lack of any self-control. There is no life threatening consequence when they stop buying.
“Hall said the experience has left him feeling bitter. ‘We had to scramble,’ he said. ‘We were definitely robbing Peter to pay Paul. We didn’t want to run up our credit card, but that was the best solution at the time.’”
=========================================
Yet another house rich and savings poor American Dream made possible by little rectangle pieces of plastic…
I’m in San Diego and remember the days — just a few years ago — when I was shopping for a car and none of the salesmen, all standing in a group near the entrance to the showroom shooting the sh*t, wouldn’t even bother to come out to the lot where I was looking.
How times have changed. I need another car (but not desperately) and new windows (also not desperately) and I am now getting at least two calls a night from window or car people.
Have fun with them…they’ll only get more desperate as the holidays approach.
Tell them things like: “I’m ready to buy now, I’ll be in your office at ten to sign the papers.”
Then the next morning call and say: “my bank just pulled my HELOC - sorry!”
“Like thousands of borrowers, Hall was a victim of falling real estate values”.
Another ‘victim’ so very sad to hear it. It’s just not fair, there he was minding his own business and along came a sucker punch. I mean damn, one minuet you have 200 grand and the next it’s 72. What about the vacation he so richly deserves for being a financial whiz.
“People with so-called liar loans, mortgages approved without proof of income or assets, are expected to be the next wave of homeowners to default. The Silicon Valley California Association of Mortgage Brokers does however, have some words of advice.”
“‘Work with your lender, don’t wait! Be persistent, lenders are overwhelmed with the number of people out there that are in foreclosure, that are in desperate and dire situations. If they say they’re going to call you and they don’t do it. Call them, continue to follow up,’ said Cathy Warshawsky, with the Silicon Valley California Association of Mortgage Brokers.”
“This is the first foreclosure prevention fair put on by the City of San Jose, but it likely won’t be the last. The night’s high turnout has prompted city officials to think about organizing another one.”
Presumably, the people with the “liar loans” are in trouble because THEY LIED. (As we’ve discussed here before, in the old days no-doc loans were used by people who actually made MORE money than they chose to reveal, not less. Back in the early 80s, if you put 33% down, they wouldn’t ask any questions and, perhaps, gave you a slightly higher rate).
So my question is, why is the City of San Jose using taxpayer money to put on a foreclosure prevention fair to assist people who committed mortgage fraud? This is an outrage! If the mortgage brokers want to deal with a fraudster, it’s their right. But our GOVERNMENT shouldn’t be helping these people.
1. They loose a captured tax base.
2. The politicos have to pretend to be doing something.
The question was rhetorical! I know that the government has to run around to keep people in “their” homes. (that they put no money down on and have only paid teaser rates for…)
Hardly matters, they won’t get another loan. Even the government is not stupid enough to repeat this. I think………:-)
Oh now that’s a good point. As I mentioned earlier when it comes to say a local gov. courting developers ( with the help of the local realtwhores of course ) it’s “We’re all in this together!”
Well pardon me but was I getting part of those SDC’s? Will I be getting a kickback on points from the loan? Is there a 6% commission in this for me? No. Of course not. But… “We’re all in this ‘together’!” O.K… if I run a health club how long do people have to be members before I get what YOU got on YOUR commission?
People need to weigh that stuff before they get on the bandwagon. Goes double for the downside.
“So my question is, why is the City of San Jose using taxpayer money to put on a foreclosure prevention fair to assist people who committed mortgage fraud? This is an outrage! If the mortgage brokers want to deal with a fraudster, it’s their right. But our GOVERNMENT shouldn’t be helping these people.”
Maybe at the next foreclosure prevention fair, some HBBr’s could show up wearing dark suits and sunglasses and just walk around casually. It’d be interesting to see if some of those there to be “helped” suddenly left hurriedly.
Current Price (Jul’08) From the Peak Price (Source: DataQuick; SFH and Condos, New and Resales):
MERCED -59.4%
Merced County -59.2%
STOCKTON -59.2%
Monterey County -51.8%
Stanislaus County -51.5%
FAIRFIELD -50.5%
San Joaquin County -50.3%
SACRAMENTO -50.1%
San Benito County -47.9%
WATSONVILLE -47.5%
LANCASTER -47.1%
PALMDALE -46.7%
Sacramento County -46.2%
SANTA MARIA -45.3%
Santa Barbara County -44.1%
Solano County -43.3%
El Dorado County -42.5%
SHERMAN OAKS -42.5%
Contra Costa County -42.3%
Yolo County -41.9%
GILROY -41.2%
Riverside County -40.2%
Madera County -39.8%
San Bernardino County -39.5%
STUDIO CITY -39.1%
SANTA BARBARA -38.8%
MORGAN HILL -38.2%
Sonoma County -37.9%
ROSAMOND -37.2%
VACAVILLE -36.7%
BAKERSFIELD -35.8%
Napa County -34.9%
SIMI VALLEY -34.3%
NORTHRIDGE -34.2%
Kern County -34.0%
Ventura County -33.5%
Placer County -33.1%
PASADENA -31.1%
CHATSWORTH -30.9%
San Diego County -30.5%
FRESNO -30.3%
Fresno County -29.7%
Santa Cruz County -29.7%
Alameda County -29.6%
Orange County -28.8%
TEHACHAPI -28.6%
Tulare County -28.5%
Los Angeles County -27.3%
SANTA MONICA -26.9%
Nevada County -26.6%
VAN NUYS -25.9%
PALM DESERT -25.8%
DAVIS -24.0%
SAN JOSE -22.6%
Marin County -20.0%
San Luis Obispo County -19.4%
Santa Clara County -17.7%
San Mateo County -17.5%
PALM SPRINGS -17.2%
CUPERTINO -11.2%
San Francisco County -8.2%
MEDIAN -34.9%
Jas
The Manteca-Merced-Modesto-Stockton area is running neck and neck in this demolition derby, all at the front of pack leading in losses…
Jas,
I just wish Palm Springs could be at the top of that list! Why!? Why!?
–
For some reason the median price in PS went up from 300K in June to 354K in July. Could be mix of houses/condos. I expect the prices in PD and PS to be in low 200s. I think that the area is way too overbuilt when I was there in 2006.
Jas
It will come down in the desert. As the jobs dry up, it will come down. Tourism is way down and the casinos are crying the blues.
DinOr,
I have a good friend who lives in Palm Springs. He tells me prices on houses are dropping like crazy. A lot of developments were built and no one is living in them. He sees a lot of for sale signs.
Oh btw, just a couple of weeks ago my friend said Palm Springs had reached about 110.
A friend of mine just sold his 3 year old home in Deep Well for $679,000. The purchase price with pool ect. was close to
$1,150,000
Nice Haircut
And to think, less than two short years ago many insisted that -2% was improbable.
Too bad they don’t have Humboldt county on there, where depreciation is even less than SF.
Multiple offers? Another sign the floor is in on this market. No one is going to drop prices to get even more offers - now you can expect to see a stable market, with prices rising slightly in the not too distant future until we get back to normal appreciation and reach an equilibrium.
No shit multiple offers galore
But not a bid in sight!
“As many as 400 people converged at Independence High School in San Jose, all hoping to get out of their mortgage mess.”
Easy:
I can’t venture to say where equilibrium may be.
I did hear something in the neighborhood the other day that does show some inflation going on - cash for keys.
Evidently, some banks are upping the ante to $2,700-$3,000 to get people to move peacefully and leave their keys, along with the appliances, unmolested toilets and landscaping, behind.
“The price was about $1,000 for the keys,” the real estate fellow told me.
How does one molest a toilet?
Ummmm, never mind. I might not want to know the answer to that question.
You start with three beef ‘n burritos, and a pitcher of beer, and…
Slim:
A molested toilet is one where the crusty wax ring, stained with aforementioned burritos and half-digested Rolling Rock, stares nakedly at you when you enter what my daughter calls the “facilibehind.”
Multiple offers? How many qualify for financing? Just wait until Oct. when Nehemiah Corp. and other such scam sownpayment programs go away, then we’ll start the next leg down in earnest.
Ben, can we PLEEEEASE see easy’s IP address? Pretty please?
An “offer” doesn’t mean a thing if you can’t swing the loan….
St George, Utah (latest stats available):
SFR Sales (April 2008)
108
Homes that were “pending” and fell out of escrow (in April 08)
49
SFR Sales (May 2008)
110
Homes that were “pending” and fell out of escrow (in May 08)
40
Looks bad here. However, I must be missing something because INC.com thinks that St George “Rocks”, Baby!
http://www.inc.com/articles/2008/07/why-small-cities-rock.html
Everyone wants to live in “metro” St. George!
There probably _is_ a floor on prices for foreclosures at entry level prices. The problem is that prices at the midrange and upper level are still out of whack.
The substitution effect will kick in–why spend hundreds of thousands more for a midrange house that’s only a little better than an entry level house? The midrange houses will sit until prices are cut.
Stuff in Salinas or Manteca that used to go for $700K is going for $350K. That’s going to have an effect on more upscale places that are closer in.
The floor in Detroit currently is sale price of $1.00 with the bank kicking in an additional $10K into taxes and $3,200 into closing costs.
He who picks bottoms ends up with stinky fingers.
If every municipality was like Detroit, the US population would be shrinking at an alarming rate. And if every municipality was like Atherton, prices would have barely fallen in Stockton.
Getting 15 bids in a week is an indicator that the prices being offered on these homes is less than an equilibrium point.
Contrary to popular belief, credit has dried up to a trickle, not completely. If I’m a lender and I am underwriting to a 20% down payment and a young couple with jobs, buying in a market that has already dropped 60%, and they are buying at a price where there is a feeding frenzy TODAY (in the foreclosure capital of CA), I feel pretty safe.
One of those 15 bids will be able to come through on the purchase. Why else would inventories be falling in the Stockton area?
“There probably _is_ a floor on prices for foreclosures at entry level prices. The problem is that prices at the midrange and upper level are still out of whack.”
That “floor” can and likely will go lower. Job losses from the recession and changes in the availability and cost of credit should further depress demand and prices. Prices at the entry level are still above historical levels as well.
Huh?
Of course you will get multiple offers if you price the house below market value. The multiple bids will bring your actual sales price up to FMV. Next year, FMV will be lower again, and banks will drop their asking price again, and they will get multiple offers again, which will bid the sales price up to the new, LOWER FMV. This will continue until inventory starts to decrease.
Easy, you have to start seeing a decrease in inventory that persists for longer than 3 months before you can even argue that you are at/near bottom.
did I close those italics?
Inventories peaked in Stockton at something like 6,000 homes. They are now in the mid-4,000’s.
I haven’t been tracking monthly, but I wouldn’t be surprised if by your metric (3 straight months of falling inventories), we have already had 3+ months of falling inventory in Stockton.
Easy is a Used House Salesperson.
“…with prices rising slightly in the not too distant future until we get back to normal appreciation and reach an equilibrium.”
A little help please:
Define “not too distant future”, “normal appreciation”, and “equilibrium” as they relate to house prices.
See Ben does let the trolls through.
Didn’t you feel great about being able to draw blood and take swipes at the poor fool.
Ben, thank you. Keeps us on our toes.
OK, I’m going to PARTIALLY come to Easy’s defense here.
A couple of years ago, people rightfully predicted that home prices would need to fall by 50% or more to get back to normal.
Why then, are people so resistant to the idea that after a market has fallen 60%, we are at, or rapidly approaching a bottom FOR THAT PARTICULAR MARKET?
I don’t get it.
For the record (where I differ from Easy), I DON’T think that we will get back to “normal appreciation” anytime soon. In fact, I don’t think the fall in home prices will stop at the first signs of a bottom. I think the pace of the falls will slow first as inventories shrink, but we won’t see any signficant OVERALL appreciation for a few years.
As someone alluded above, starter home prices will firm first, and the mid-range will take a long time to reach their equilibrium. The net effect will be a slow slide in overall pricing.
Intelligent Risk Tankers In California
Speaking of tankers…how ’bout those oil prices? This latest move threw me for a loop - but that’s okay because high gas prices are the best accelerant to pour on this inferno.
I can help those who want to the molest the toilets. Part of my work is doing food inspections for Taco Bells. I am happy to donate the food to anyone who wants to ‘molest’ the crappers. For ‘dude’, I ‘donate’ the food to my local LDS missionaries (I am also church member originally from SLC). And I was a financial clerk in congregation while in CA. The bishops I served under would tell a member who came for financial counseling that they needed to eliminate every ‘extra’ expense (including cable TV, newspaper and magazine subscriptions, cell phones, and other things everyone thinks is needed) before church would provide any temp assistance. Church teaches correct principles. Not all members follow.
And for the response to my rant earlier..
“Milk and cookie me please”.
Were you my financial clerk? That sounds just like what I used to do. Me and he must have read the same instruction book!
Dude, probably not yours. I was a FC in the Livermore Singles ward and then in the Castro Valley ward back in the 2000 - 2004 timeframe. But most bishops do similiar. I served under some fantastic bishops. I have always had great respect for the bishops of my many wards, whether SLC, CA, or now ABQ area. People have same commitment to serving God no matter where they are geographically. And that goes for most true servers of God, no matter what the specific religious belief is. I do respect all true believers of their religions, and tolerant/respectful of all. And expect the same of all people. There are some believe differences, but we can all respect each other’s in
dividual believes that are sincere and share the good points of each faith that makes people and the world better. Heaven knows there is enough of that needed.
And dude, anyone that serves as a bishop, holds a demanding careeri, and meets family obligation truly has my respect. That is a truly full schedule. My current bishop here in ABQ is truly a wonderful man and we have a great ward. And I can say the same for all of congregations over the last 25 years since my mission in Japan. Now, married (finally) with 2 adorable daughters - waited longer than usual. Temple 10 min,church 5 min from home. church part is good. STILL HAVE OUR struggles though.
Hope our missionaries don’t molest the toilets. They are 20 yrsold boys and have rot iron guts;
If one wants to see KFC TB and McD unedible, spend a day withme and itwil look disgusting by the end of the day
The Glendale News Press. “Economic factors have created a deep funk in sales along Glendale’s Brand Boulevard of Cars, mirroring a national downturn in automobile purchases as customers continue to feel the pinch of an enduring housing slump, a pervasive credit crunch and soaring gasoline prices, officials said.”
“Sales of new cars in Los Angeles County plunged more than 18.6% from January to March as dealerships along Brand Boulevard have been feeling the pinch of sparse customers and decreased revenue.”
“New car sales at Star Ford are down 20% from last year, said Alex Tamez, director of operations. ‘It hasn’t been great. Foreclosures have affected us. The banks that had financed homes finance cars. Now, [banks] are looking deeper. It’s harder to get people approved.’”
GOOD! There are WAY too many cars in Glendale already….we have little to no street parking. People drive like idiots in high powered cars. Where do they think more cars are going to go?