The Daily Bit Bucket
One reader had this suggestion. “I want two new posts every morning: “‘The Daily Bit Bucket’ where everyone can put their OT comments without disrupting the flow of threads.”
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Great idea.
Also, I might suggest that when aparticular topic is still a day old, but on fire with continuing comments, you might want to continue to give it a top position - with a note such as “loquascious leftover”.
Phoenix area inventory exploding (ziprealty):
4-3-06: 40,012
today: 42,778
wow, 2,766 more houses for sale in only 12 days!
50K in 10 days
it can be an ongoing black hole to talk about junk and stuff. maybe even combine w/ the craigslist - even though i like craigslist postings no matter where they are.
we’ll still manage to get off topic.
Combining the daily bit bucket with interesting craigslist postings seems a good idea - I would not always read the daily bit bucket, but craigslist postings with “nasty” comments are always a joy.
This is going to work. I can feel it in my bones just like Gary Watts knows 17% is in the bag.
Hahahah- good one — as a penitent OT poster, I must also confess I enjoy OT posts most of the time - especially the ones weighing in with breaking news / inventory stats etc.– if you disallow that stuff IMO you make the blog far less useful.
I’d never presume to disallow. I only made these suggestions because the high volume has made for a navigation problem not one of quality. Ben gets around to everything eventually but some people can’t wait to post about feeding squirrels in the middle of a yield curve inversion thread. Now they won’t have to.
Ben, as a suggestion; “Daily Bit Bucket Apr 15″ until it gets to 100 posts of so and then “Daily Bit Bucket Apr 19″ and so on.
Another good suggestion Cote…..
Cote;…maybe the bit bucket should be renewed each day when Ben puts out his first post ???
Does anyone have any stats or other intel to share on the Hopkins, MN area (a suburb just west of MPLS I believe)? I’m trying to get a handle on the condo market there, inventory/sales/prices, etc.
Living on Hopkin’s border, I have no statistics, just some information: Yes, Hopkins is a suburb of Minneapolis but a more distant one; St.Louis Park is in between the two. Hopkins is surrounded by Minnetonka at about two-third of its border, some public institutions are shared, like the swimming halls. Hopkins has more the feel of a village with a core, while Minnetonka is more outspread. If you ca’t find any statistics on Hopkins, look for those of Minnetonka.
“Does anyone have any stats or other intel to share on the Hopkins, MN area (a suburb just west of MPLS I believe)? I’m trying to get a handle on the condo market there, inventory/sales/prices, etc.”
The City of Hopkins website says its housing stock is about 60% rental.
Take a look at
http://www.hopkinsmn.com/housing/newdev/index.html
It shows the proposed new developments (mostly condo) in Hopkins. It also has links to past developments and other housing-related information.
Here’s a few things about Hopkins to consider: it’s only got a population of about 18,000 and it’s next door to Minnetonka and Excelsior, which are the high-income, high-status areas to live. If folks have the money, they’d rather live in Minnetonka or Excelsior.
It’s also important to note that the entire Twin Cities metropolitan area has got an absolutely ridiculous condo development boom going on. The thing is, condos are not considered desirable housing by most of the residents here (we have an outdoors orientation here), and the numbers of them being built are in the thousands, so we’re gonna have quite the glut of unwanted condos for the next several years.
Hey, thanks a lot for that info. good stuff and what I was looking for.
Auger:
Sorry, I tried to post earlier (on the Twin Cities thread) but it got lost in cyber space:
here’s a re-hashing;
These are two sites that show kind of what’s in the works, most pertain mainly to Mpls, but remember that Hopkins competes with Mpls for the condo market at least.
http://www.minneapoliscondoguide.com/new-construction-list.php?order=building_name
http://www.urbanplanet.org/forums/lofiversion/index.php/t7290.html
Overall, I don’t know the Hopkins market, it’s too far from my home. What I do know is this:
They are building SFHs like MAD in the west suburbs, mostly the high end stuff ($600k to way over a milion+). They are also building Towhnomes like mad out there, again higher end ($400k plus). In fact, there’s a sign I just drove by yesterday on my way to Chaska (an even further suburb) that extolled “Luxury Townhomes for only $400,000!!!!”.
But I’m not sure about the local Hopkins condo situation.
From a TC condo situation: it doesn’t look good for your friend. There are several high rise condo towers that are going up right now in downtown Mpls, some will be finished soon, some are just starting, and there are TONS in the planning stages. Not only that, there are a literally over a hundred smaller condo complexes going up all over.
A few of your friend’s competition:
The Carlyle: luxury condo tower downtown Mpls. They’re starting to put the “skin” on the frame now… it’s getting built FAST:
http://www.thecarlylelife.com/main.html
Also, the Midtown exchange, which is finishing (it is the 2nd largest non-skyscraper building in MN only after the Mall of America). It is mixed-use, but TONS of condos
http://www.emporis.com/en/wm/bu/?id=122696
and
http://www.midtowncommunityworks.org/exchange/
There is also the Midtown lofts that are finished. IT will be 3 square city blocks of condos/townhomes. They have phase 1 (the first square block) done. Phase 2 is being built right now:
http://themidtownlofts.com/
There are other things in the uptown/midtown area including Lumen and MoZaic (a 10+story tower);
http://ouruptown.com/development.htm
Then there’s several other highrise towers going up including:
1) the loop, going near lake Calhoun, which isn’t far from hopkins…
2) The Nicollet: a 48 story tower in downtown Mpls (just about to start)
http://thenicollet.com/
3) Skyscape (under construction), I forget how many stories… maybe 30 or so
http://www.skyscapecondos.com/
5) Grant Park Commons: finished. I think 40 stories or so.
Here’s an older site: many of these have already been built, or are just coming on line now:
http://www.urbanplanet.org/forums/lofiversion/index.php/t7290.html
And then lastly, a major condo development called Excelsior and Grand is just being completed (the later stages) in St. Louis Park, which borders Hopkins:
http://www.excelsiorandgrand.com/
Again, the problem with your friend’s complex is COMPETITION. I don’t know if there are a lot of condos in Hopkins, but there IS a lot of new SFH’s there, and there is a veritable glut of condos in the Mpls/western suburban area.
Hope that helped.
Clouseau.
If anyone wants to relive the real estate frenzy in california last year, I can highly reccomend the following KCET special. Video available online at
http://www.pbs.org/now/thisweek/index_082605.html
It has everything!
-A clueless realtor fresh out of the realtor school with 2 ARM loans himself
-Sheeple, future home owners mindlessly repeating the mantras of the realtor
-lies, lies and more lies.
TERRIFIC LINK.
And that was August.
How things can change so quickly, huh?
Man, this is gonna be really, really, really bad.
I love watching it unfold.
“The only risk, is if housing values go down. I think that’s a risk we’re willing to take, and a lot of other people are too.”
That woman needs to have this sentence enscribed on her tombstone.
I feel for the poor shmuck who married her, and their daughter.
Can you say ‘under water’?
I laughed while walking home from work yesterday, when I saw a sign in front of a new “conversion” saying “why rent when you can invest”……This was in Hillcrest near Scripps Hospital. LOTS of new for sale signs cropping up, mostly properties I remember being on the market late last year.
While driving around a few minutes ago, I had KNX1070 (LA) on the radio. I heard an advert that mentioned a Realtor(tm) by name, talking about how she sponsored kids for camp and is such a good, ethical citizen. Turns out it was sponsored by a Realtor(tm) group, and ended by instructing listeners to “make sure your agent is a Realtor(tm).”
I guess the fact that realtors now rank somewhere below used car salesmen on the respectability list is forcing them to do image advertising.
Someone should contact the used car salesmen’s association and let them know that their sleazmenship ranking is at risk from this campaign!
I have a realtor friend in San Jose. I told her about these blogs and tried to convince her to sell her home.
She said the price would only drop 5% this year and she won’t sell for another few years.
What a blessing — her house could be worth 40% less by then and you could bail her out by buying it. Win-win, sort of.
Okay, I need your help guys. My brother-in-law (rich consultant, lives in Switzerland) has decided that his parents (my in-laws) need a new house. They currently own (no mortgage) a nice-sized historic twin in a cute town in Lancaster County PA, Lititz. It needs work (mostly cosmetic) but the problem is, they are terrible packrats. Also, now that they’re both retired (getting SS, plus disability, plus military pension, plus govt pension) they basically have nothing to do but shop. We spent a lot of effort last year clearing the house out of junk; when he came to visit this year, it was just as bad again (with new junk).
He thinks the solution is to buy them a new house, in one of the new small townhouse developments nearby, a small sq footage (like 1200) one. These are about $275K right now. He says the mortgage would be “a few hundred a month from each of us” (there are 4 children who would be on the hook for this).
He also wants to buy them something WITHOUT selling the current house first, cos he knows that part will be very hard (b/c of all the crap). But even if we do sell it, it would have to be “as is”, which would get us not very much I’d think.
Why on earth would we want to put these people, who have pretty decent income coming in, and no mortgage, in a new mortgage for any reason? (and why do we all have to pay for it, but that’s another story altogether)
If this is such a good idea (getting them a new smaller place to start “fresh” in) then why not just have them rent the new place?
Ugh I really feel like this is a mistake. They’re mid-60s. In 10-15 years they won’t be able to deal with all the stairs anyway (if not sooner).
I keep telling this guy we’re in a huge housing bubble but he doesn’t buy it. Frankly their current house is not bad. If they could cut down on the Dr. Phil-level packrattyness, some paint and touchup and it would be a really nice historic home. It’s right in the middle of town and should really be a decently valuable property. It kind of pains me to see them let it get run down to be honest. It’s a nice stone/brick building that’s been there for over 200 years.
Thanks for any advice!
This is the most hairbrained idea I’ve heard in a while. Trade a house with mortgage paid off for new one WITH mortgage at the top of the biggest bubble in history? Smart. And oh yeah, let’s not wait til the first house is sold.
You cleaned up their place once, they cluttered it up again. Sounds like they like living in clutter. Sounds like any new house would get cluttered up pretty quick.
BIL sounds like he just might be a total control freak who is trying to adjust these people’s lives into sthg. he feels is more acceptable to HIM.
Do these people even WANT to move? Sounds like they may be perfectly happy where they are.
Cheers,
Dear Abby
Your in-laws’ problem isn’t their housing, it’s their compulsion to acquire things. I’d make a counter-proposal to your rich b-i-l — actually, I’d make two:
1. He buys them the house with his money. It’s his idea, so if he’s so sure it’s the right thing to do, he should put his money where his mouth is.
2. After he quits screaming about that proposal, make him your counter: the in-laws stay in their current home. You’ll all pitch in for a cleaning service to come in weekly to clean it. He can pay for a storage facility to which, say, three times a year, the cleaning people will pack and move the in-law’s latest accumulation of crap. Who knows, maybe they’ll enjoy holding a garage sale every few years.
Are there any casinos in your in-laws’ vicinity? Sounds to me like they’re determined to throw their money away on something, and at least if they lose it at the casino they’re not filling their house up with crap.
To get serious for a moment, another possibility would be to look into whether any local community organizations such as churches or school districts or some kind of social group have organized senior outings and/or a senior center where they can visit and do other things besides shop. If they’re just bored, that might be the ticket. But if they are suffering from compulsive spending, there really isn’t anything you can do.
One final comment: if they really are compulsive spenders, I’d think it’d be a dangerous move to give them a home payment-free while letting them keep their current home. What’s to stop them from gutting the equity in that property and spending that all away? And that’d just make the eventual resolution hairier yet.
Thanks! We already told him no (as did the sister, there is one other brother who will do whatever people tell him to) but he keeps sending us listings and saying “living like that (their choice!) is taking years off their lives, yadda yadda”
it’s driving me nuts.
if we all went in on this mortgage for them there would be bloodshed at some point, it would make us all hate each other. such a bad idea.
do they want to move? sure why not! nice new place, free for them? they’d just keep the other house for their stuff.
BlackOrchid;….Just leave them alone and let them live out their days in piece…Even if its cluttered up…
As far as the stairs, probibly good daily exercize for them until disability enters the picture…In the mean time, I would look at the possibility of converting a downstairs room into a bedroom with a bath In the event one or both become unable to climb the stairs…
I’ve been reading Ben’s Blog for about 6 months now and I’ve come to a couple of conclusions.. First, thank god for guys like Ben who’s work and initiative here with this blog has helped open some people’s eyes and will undoubtedly prevent more pain for more people in the long run.. thanks Ben.. Secondly, I’m just pissed.. I’m pissed at this housing bubble, but I realized that it goes a little deeper than that for me, because I’m pissed because of what I see as a softening of the USA. How in the hell did something like a home turn into a speculative bubble, the likes of which none of us have ever seen in our life time? I hate to say it, but it reeks of what is not well with the good old USA. “The fast, easy buck !”… What happened to going to school and working hard to become a professional in some field and earning your living that way? What happened to good old savings and elbow grease? … When did the family get togethers and neighborhood block party discussions turn from family, friends, school and activities to home equity speculation or what so and so got for his place down the street ? You bet that stuff pisses me off. I hate to say it, but the USA is becoming soft on the underbelly and this housing market is just one of the symptoms. Last fall’s New Orleans flooding debacle was another. Everyone is looking for their share or handout or to get something for nothing. Yup, that pisses me off too. You want to prevent another flooding disaster New Orleans ? Well, fix your bloody levy and then come up with a plan and elect a leader / Mayor / Governor who can execute….. period !! That does not absolve the abysmal performance of FEMA before the good old Coast Guard Vice Admiral took over complete control down there, but the thought that Uncle Sam “owes” anyone anything other than liberty and freedom is baloney.
And to all the dipshits who are still in denial about the direction of the housing market, please do the rest of us a favor and give it a rest. You better pull your head out soon for the good of your kids and grandkids as this thing needs to be checked before it’s too late (if we’re not there already). Your ignorance of not only basic economics, but common sense pisses me off too.
And to all the high heeled, finger polished, big-haired Realtors in their Lexus machines, I have to give you credit for pulling it off as long and as well as you have. Many of you have made a bundle for yourselves and for other home owners.. congratulations! Now, do the honorable thing, and tell those potential buyers who you are seeing the bloody truth as to what the market is doing and likely to do or you will piss me off too. Nothing pisses me off more than when someone’s arrogance and greed is used to hurt others, eg. Enron !!. Yes, Skilling, Lay and Fastow and those greedy little energy traders piss me off too in case you were wondering..
Okay, now that I’ve vented a bit, I hope to enjoy my Easter tomorrow with my family and friends and I will avoid, completely, any and all forms of discussion on the real estate market. Unless, of course, someone pisses me off..
I second what Kevinmod just said. Very succinct and well said. Happy Easter everyone.
For the in-laws, leave them in their house. DO NOT put them in another house. It will just get junked up. I have seen enough people that are junk-addicts, where someone cleans up their mess and their house is completely junked up in short order. There is nothing YOU can do. I have this behavior in my family also. The cleaning a couple time of years is a good idea. If BIL wants to buy them a house, he can do that with his money, and then only he will regret the decision. Ciao
Looks like I’m going to interivew for a job in Redondo Beach, CA. Could someone summarize the bubble status of this area for me? I am familiar with the LA market in general, but a quick look on dataquick and zillow indicate this area has already ‘popped’ (year-over-year gains are flat).
i dont know about the market in redondo, but please rent for a year befor thinking about buying a home at the top of the market. i have been renting for 8 months now and the new home market in kingman is flat and going down very slowly. so i am going to rent till the piti with 20% down equals the rent.
Saw this quote that AG has been harping on….
Nobel laureate Hyman Minsky points out that stability leads to instability. The more comfortable we get with a given condition or trend, the longer it will persist; and then when the trend fails, the more dramatic the correction is. The problem with long-term macroeconomic stability is that it tends to produce unstable financial arrangements. If we believe that tomorrow and next year will be the same as last week and last year, we are more willing to add debt or postpone savings for current consumption. Thus, says Minsky, the longer the period of stability, the higher the potential risk for even greater instability when market participants must change their behavior.
The US market is 19x over valued by historical measures..Is it different this time??