The American Dream In High Reverse
The Miami Herald reports from Florida. “Gov. Charlie Crist and a throng of supporters packed the lawn of Keith and Elizabeth Markowitz’s Orlando home to launch the Amendment 1 property tax campaign with a promise: if the referendum passed, they would no longer be ‘trapped in their homes.’ A year later, the amendment has overwhelmingly passed and the Markowitzes are still trapped — now by the plunging real estate market. As they’ve waited for the market to return, their property value has dropped from $300,000 in 2007 to $230,000 last year.”
”’We are still anxious to move, but we haven’t sold our house,’ said Keith Markowitz, who took his house off the market after 16 months. ‘I’ve got too many foreclosures around me.”’
The International Herald Tribune. “Welcome to the American dream in high reverse. Lehigh Acres is one of countless sprawling exurbs that the housing boom drastically reshaped, and now, the bust is testing whether the experience of shared struggle will pull people together or tear them apart. On a recent Friday morning…laid-off construction workers in flannel shirts scavenged through trash bags at a home foreclosure, grabbing wires, CDs, anything that could be sold.”
“‘I knew it was coming,’ said Gloria Chilson, the former owner of the house, as she watched strangers pick through her belongings. ‘You take what you can; you try not to care.’”
“Residents remember the boom for its noise, with dump trucks lining the streets and power tools heard in nearly every neighborhood. Housing prices doubled, then tripled, and jobs were plentiful, nearly all of them tied to real estate. Signs of trouble were ignored.”
“‘They used to bring 20 busloads a day,’ said Bob Elliott, a former salesman…who struck out on his own in 1982. ‘We had 300 customers, seven days a week. Sometimes houses would sell three or four times in a few months, and no one would move in,’ Elliott said.”
“Then, in 2007, it all went quiet. Houses stopped selling. Foreclosures multiplied. The median home price in the Fort Myers area dropped to $215,200 in December 2007, from a peak of $322,300 in December 2005. It had fallen to $106,900 two months ago. Home sales in Lee County are picking up, running roughly even with foreclosures. But no one here would describe Lehigh Acres as out of the woods. Real estate agents said the homes that were selling here typically went for only about $45,000, a third of what they cost to build.”
The Palm Beach Post. “A Wellington couple have managed to do what many who bought at the market’s peak are dreaming of: escape a new-home contract. A Miami-based arbitrator ruled in January that the contract Kurt and Micheline Moeding inked with Kolter Homes violated federal law, and that they should get their $76,114 deposit back. The couple signed up for the $629,580 home at Kolter’s Verano community in Port St. Lucie in 2006 - before home values plummeted.”
“The problem, according to the arbitrator’s Jan. 22 decision, is that Kolter gave itself wiggle room by stating it wouldn’t be bound by the two-year deadline if weather or other obstacles interfered. ‘The arbitrator ruled that it really wasn’t a firm commitment,’ said the Moedings’ Coral Springs-based lawyer, Scott Gelfand. ‘I expect that this will open up the floodgates,’ he said.”
The Naples News. “Creditors are lining up by the thousands in hopes of getting paid back by WCI Communities Inc. WCI filed for bankruptcy in August of last year as it struggled to pay off about $2 billion in bank debt. One of the biggest claims comes from Bank of America. The bank filed as an administrative agent, saying it and other lenders are owed more than $535 million. The Bank of New York Mellon Trust Co. has three claims, adding up to more than $665 million.”
“There are small claims, too. John Dier, owner of A Able Locksmith in Naples, said he’s owed $221.30 for his services on two different bills. His company would often change out the locks when homes were turned over from the builder to a buyer. His amount is unsecured, putting him at the back of the line to receive any money.”
“‘If they come through that’s great,’ he said. ‘It’s out of WCI’s hands anymore. It’s in a lawyer’s hand now.’”
The Tampa Bay Business Journal. “Rising 36 stories above the St. Petersburg skyline, Signature Place is the final relic of a housing boom now becoming a fading memory. As just weeks remain before the $170 million tower welcomes its first residents, Gulf Atlantic Communities Inc. is offering buyers ’significant’ reductions on pre-construction prices, a bid some observers believe is a consequence of unfriendly appraisals.”
“Even buyers who may have been intent on paying full price and moving in three years ago may not be open to it now. Those who are still packing their bags to move in could end up needing to hop some obstacles laid out by banks in the tightened credit climate to make it happen.”
“The fact they have a great location and a beautiful project helps, but it is ‘only going to carry it so far,’ said T. Sean Lance, managing director for NAI Tampa Bay. ‘At some point, reality has to be faced where people aren’t qualifying for mortgages, units aren’t appraising where they’re supposed to be and measures are going to have to be taken to come up with other solutions. The next 60 to 90 days are going to be telling.’”
The Herald Tribune. “A University of South Florida professor, quoted in The New Yorker explaining what went wrong with Florida’s housing market, used a now familiar term. ‘Florida, in some ways, resembles a modern Ponzi scheme,’ Gary Mormino said.”
“The buyers did come for years. But when the Ponzi scheme ran out of new suckers to pay the absurd prices, it all collapsed. We are in the rubble now, wondering if the collapsing is done. The problem is that near-peak-market home buyers owe ridiculous amounts of money on homes not worth anywhere near as much, no matter what some bank-approved appraiser once told them.”
“‘It took us 14 years to buy our first home, in North Port,’ a woman who works for Sarasota County told me. She and her husband chose a humble house that cost $129,000, and paid $20,000 down. ‘Now it is worth probably $45,000, at best. There are 17 empty houses on my street. We are now talking ourselves into walking away.’”
“Another North Port owner told me he left the state and stopped making payments two years ago when he lost his job, but his disabled sister still lives there. It seems mortgage servicers are too busy to file foreclosure.”
The News Chief. “In 2008, more than 9,400 foreclosures were filed in Polk County, courthouse officials said Friday. That’s compared to about 5,100 foreclosure filings in 2007. In Central Florida, which includes Tampa, Orlando and Sarasota, 315 homes with the program are in short sale, which means their current market price is less than their value. Owners have defaulted on their loans but no paperwork has been filed to classify the homes as foreclosed. There are homes in short sale by Fannie Mae in Polk County, but representatives connected with the company could not give an exact number.”
“A slumping housing market might have been one of the reasons behind the current economic recession, but now it also means lower home prices, local Realtors say. ‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
“It’s a spacious 2,500-square-foot stone-and-brick-facade home with four bedrooms, a walled-in yard and an efficiency apartment in the back. Three years ago, someone paid $240,000 for it. But in about 45 days, Carline Jeudy, a single mother of four and a renter until now, expects to close on her purchase of the bank-owned foreclosure in Opa-locka for just $90,000.”
“”I never thought I would be a homeowner because of the money I’m making,’ said Jeudy, 33, a buffet attendant in downtown Miami, whose take-home pay is about $22,000 a year. ‘I never thought I could afford it by myself.’”
“At the end of January, the number of homes for sale fell by 4.6 percent…but there were still 70,495 properties for sale in both counties. Buyers need to proceed with caution when buying in new condominium buildings, said Lucas Lechuga, of Keller Williams Realty. ‘It’s extremely difficult to get financing in those buildings, and that’s why prices will continue to go down,’ Lechuga said. ‘If you have cash, though, you can name your own price.”’
“‘Eduardo Fernandez, a small-business owner in Little Havana, proudly showed off the four-bedroom Florida City home he has under contract for $47,500 cash. It needs work and will cost an estimated $20,000 to repair vandalism inflicted by the former occupants. Fernandez plans to rent the homes and sell them down the road when prices go back up.”
”’This is the only opportunity, I think, for the next 30 years,’ Fernandez said. ‘There won’t be another opportunity.’ He added that he was also bidding on a second property in the area.”
The St Petersburg Times. “Contemplating the wasteland of vacant houses in the southwest Florida community of Cape Coral, economist Hank Fishkind opined this week that some of this housing won’t be sold ‘at any price.’”
“He assumes Lee County will suffer 85,000 further foreclosures this year. By contrast, the much-more-populous Hillsborough County anticipates 40,000 new foreclosure cases. Hillsborough’s comparatively ‘happy’ foreclosure forecast allowed Fishkind this week to announce the bottom of the Tampa Bay area housing market, though he assumes we’ll grovel on that bottom for a couple years.”
“I can’t help thinking he’s overly optimistic based on household formation statistics for Florida. Don’t look for the government to rescue us. Congress has flopped trying to play Zorro with bad mortgages. According to the Associated Press, the Hope for Homeowners program, designed to let 400,000 troubled homeowners swap risky loans for traditional 30-year fixed-rate loans, has refinanced only 25 loans since it started in October.”
“At that pace it will take 5,000 years to help the promised 400,000. Hope you got the extended warranty on the Owens-Corning shingles.”
‘Owners have defaulted on their loans but no paperwork has been filed to classify the homes as foreclosed. There are homes in short sale by Fannie Mae in Polk County…Another North Port owner told me he left the state and stopped making payments two years ago when he lost his job, but his disabled sister still lives there. It seems mortgage servicers are too busy to file foreclosure.’
This is the big story that I have been trying to get out. What does it matter if Fannie Mae announces a moratorium on foreclosures, when they have this kind of a backlog? The still keep working away on the old ones. And it’s not just in Florida that houses sit for years after the payments stop coming in.
BTW, you knew this was coming:
‘The Hyatt Siesta Key Beach, the fractional ownership resort under construction along a stretch of the island just south of Stickney Point Road, is lowering its prices to attract buyers in the struggling economy.The Hyatt property initially began selling six-week segments last year ranging from $250,000 to $750,000. Hyatt has now decided to reduce its asking prices, with some units now being offered starting at $150,000.’
‘The foreclosure plague that has devastated the residential market is spreading into the commercial sector, promising to expand already bloated bank real estate portfolios as loans go bad on properties such as gas stations, hotels, offices and retail buildings.’
‘There currently are about $5 billion worth of troubled or potentially troubled commercial properties — including office, hotel, retail, industrial, apartment and development — in South Florida, according to research conducted by Real Capital Analytics…According to the data provided by Real Capital, only about 5 percent of the $5 billion have been foreclosed so far.’
‘Marika Tolz, the court-appointed receiver for the Douglas Centre, said she has been appointed receiver on several other commercial properties in foreclosure. ‘It’s the first time that I see large office buildings going into foreclosure,’ Tolz said. She declined to name the other properties.’
Love the St Pete Times article, Ben!
Finally, someone agrees with us and calls the eCONomist on their doubtful conclusions!
oops, forgot to add: the comments are golden!
Not sleeping at night in Siesta Key, I take it.
Oh, and this:
What a complete dumbass–same thing happened on a massive scale in Massachusetts in 1989. National news too because it happened right after Dukakis’ failed presidential bid.
I think I read here about similar fallout in CRE in Tejas after the 1987 oil bust.
I’m not even 30 years old–HOW DUMB DO YOU HAVE TO BE TO IGNORE WHAT’S GOING ON ALL AROUND YOU FOR YOUR ENTIRE LIFE?
This is the big story that I have been trying to get out. What does it matter if Fannie Mae announces a moratorium on foreclosures, when they have this kind of a backlog?
Rest assured Ben, some of your minions - and I use that term in the proudest sense - are busily testifying in the highways and byways, spreading the gospel to the unsaved and skeptical.
One of my husbands clients…has been living in his house mortgage free in Florida for the last 3 years..after hiring a attorney..they have not been able to figure out WHO OWNS THE MORTGAGE…he told my husband he has saved more for retirement in the last 3 years than he had in the last 10. He doesn’t even get statements coming in the mail!
He said he will stay there as long as he can..as for now that may be a very very long time..
”’This is the only opportunity, I think, for the next 30 years,’ Fernandez said.
First, kudos to him for driving down rents.
But… we cannot be at a bottom when everyone still thinks the market will turn around in 6 months. We have too much ‘easy to panic’ money going into the market.
“Contemplating the wasteland of vacant houses in the southwest Florida community of Cape Coral, economist Hank Fishkind opined this week that some of this housing won’t be sold ‘at any price.’”
For many ex-urbs, it is time to fire up the bulldozers. How many homes need to be razed? 500,000 would be my first guess (nationally).
‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
This is why we’ll see credit continue to tighten. No discipline. No ability to run the numbers in a spreadsheet. Most of all… low cash reserves to sustain.
I recall be mocked for using a spreadsheet to calculate a home’s value as recently as spring 2008. What has this nation come to when very basic math is treated like a joke? Ugh…
Got Popcorn?
Neil
“What has this nation come to when very basic math is treated like a joke? Ugh… ”
Dude, didn’t you get the memo? Math is hard, why should we even try to accomplish something that’s just so.. HARD!
This nation has become a nation of victims for the next financial ponzi scheme because of our lack of math skills. That’s why when I talk to most people I do so in VERY basic math terms. Take your salary, multiply by 3. That’s the house you can afford. Take the price of the home, divide by 10. That’s how much it should rent for, if rent is < the home price/10, your paying too much. I realize that there are MUCH better formulas for determining value. However, at the same time, I also realize that RE agents and MTG brokers used those “much better” formulas to confuse, rip off, and take advantage of their fellow man for the past 10 years. That’s why I don’t want to make it too hard, or too unapproachable for the “common” man. Make it easy and people will follow it, understand it, and hopefully, live by it. Had either of those rules been followed/understood during the boom we would not have the disaster that we currently see today.
There’s one other “math” principle that people don’t get: Housing simple can’t, over the long term, increase in price faster than wages/inflation. Otherwise in a generation or two, nobody would be able to afford a house.
It has never been a good bet for a long-term investment. At best, it’s a way of making your expenses predictable and manageable if you bet correctly that you will can live in one place the rest of your life.
Again, I’m not a “sour grapes” renter; I own a house and would welcome another 50% median price reduction. The sooner we get back to historical 2x income pricing (I think 3x is high by historic measures) the better it will be for America.
“There’s one other “math” principle that people don’t get: Housing simple can’t, over the long term, increase in price faster than wages/inflation. Otherwise in a generation or two, nobody would be able to afford a house.”
Of course your right, and I’ve tried to point this out many times to people around me to no avail. If housing continually outpaces inflation eventually EVERYONE will be priced out. It’s just a totally flawed math argument to think that housing can outpace inflation over time, it HAS to mirror (or be under) inflation.
Of course, housing should actually cost less today then it did 100 years ago, techniques, tools, and labor costs (because of increased effeciency) are MUCH lower then they were 100 years ago. Frankly, the house part (not the land) HAS to be a depreciating asset, it won’t last forever, and it gets cheaper to build them (with the exception of fake/bubble demand) over time. Land, on the other hand, as it is a limited (notice I didn’t say scarce, only limited) commodity should appreciate over time. But not at a rate greater then inflation for the same reasons mentioned above. Eventually NOBODY will be able to afford anything.
Michael,
This is not about math. This whole episode is about speculation. Do you think lottery ticket buyers do any “math”? No. The odds of winning are astronomical.
When you can buy a house for NOTHING, and even get “cash back at closing”, the benefits are way beyond the downside. That is using a little math………buying is “cheaper” than renting, in the SHORT-Term.
When the equation changes………Walk away.
That’s what’s happened. It wasn’t a lack of math skills on the part of buyers. It was those geniuses in the Financial Industry. Think of it..”Financial Industry”. What is it they make? Dreams. Pipe Dreams. Crack Pipe Dreams.
Of course, housing should actually cost less today then it did 100 years ago, techniques, tools, and labor costs (because of increased effeciency) are MUCH lower then they were 100 years ago.
Well yes, builders are more efficient, using fewer, less skilled man hours per square foot. As for materials, many of the raw inputs cost more, builders have learned to use less real wood and more “engineered materials.” But instead of spending less on housing, Americans have chosen to buy more housing. The number of square feet of housing per person has been increasing for years. A bedroom and bathroom for every child, people moving out of the house in their early 20s etc. are all ways that we consume more housing than earlier generations.
Jim,
Yes, your right, and I should have qualified my statement. On a per/sq/ft basis, housing should cost less today then it did 100 years ago. But, as you correctly point out, we consume more housing, so the overall house costs could be higher. Good catch.
Michael–on land prices, a quick disagree. You must take population/demographic factors into account. However, in the US there is so much land available vs. population that this can usually be ignored. It usually comes up in urban settings when there are secular advances or declines in population and acreage is fixed.
In some very densely populated countries, or countries where “old families” control much of the land, or where there are laws that artificially tie land up, demographics can play a rather important role in land prices.
Finally, there is the ‘red herring’ issue of other uses–any mania for stuff in the ground like gold, oil, or some nutty agricultural fad (tobacco, ethanol, whatever) can temporarily distort land prices until that market collapses again…
There’s one other “math” principle that people don’t get: Housing simple can’t, over the long term, increase in price faster than wages/inflation.
I think I’m stating the obvious, but you just lived through a decade of real estate price appreciation that was greater than wage growth for the same period. We went through another period similar to this in the mid-late eighties. So, 18 years of home price appreciation outpacing wages out of the last 30 says you’re wrong. Extend out your statement to 50-100 years and maybe your statement is correct. Of course, over the long run, we’re all dead.
Basically what I’m saying is that long-term trends can hide profitable short-mid term trends. Housing is no different than any other asset class in that regards. We need to make sure, even on this blog, that we don’t dimiss reality because it doesn’t match our beliefs…
Yes, but the other 12 years in that 30 year period shows that I’m right (as prices went down/collapsed in the last 2 times inflation was significantly outpaced). I guess we really should say that there are good times and bad times to buy houses and, if you know how to do math, it’s pretty easy to figure out how good/bad it is right now. And, unfortunately, because buying at a bad time is SO devastating, if the math says its a bad time to buy (300X rent, 10X median home price/income) you just have to wait it out (unless you can afford to lose a few 100K).
RE bubbles are relatively rare, there’s only been a few in recorded history. Because of that, and because of the unbreakable (long term) link between inflation and RE prices, it’s pretty easy to figure out if now is a “good” or “bad” time to buy a house.
if the math says its a bad time to buy (300X rent, 10X median home price/income) you just have to wait it out (unless you can afford to lose a few 100K).
I’m willing to lose 100k *as long as I feel secure in my employment*. Its the $300k downside that scares me. My feeling of employment security is dropping though…
I’ve read through this whole reply and I agree, to most people you have to make things very simple.
To think I left out of my original post a rant on down payments.
Got Popcorn?
Neil
Housing simple can’t, over the long term, increase in price faster than wages/inflation
House prices are not included in inflation calculations, so maybe house prices can be independent of inflation(rent equivalent is include, so maybe rents & inflation are linked).
I have seen studies that show that wages have actually gone down since the early 70’s. Wages can be independent of inflation as well.
Saying house prices and wages/inflation are linked needs a proof.
Hence the move from single income families to dual income families. Throw in easy access to credit and now you see how most have “kept up” with increasing living expenses, especially housing.
And more kids become lost.
Testify, Brother Fink!
‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
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the new math. I’ll buy that for a dollar.
If there is cheap houses in a nice area, why not figure out a way to kick off a business there?
The business might have to cater to Brazilians, who have taken over much of the OJ biz thereabouts.
So now Fishkind after getting religion for a brief moment has ventured to call a market bottom once again. Frankly, anyone venturing to call a bottom anywhere is just plain insane, uninformed, or both.
There is nothing about the bubble that makes me see red more than quotes from Fishkind. His latest sequence of appearances, as catalogued on this blog, is more comedy tour than serious economic analysis, and displays one of the flaws of our nation, which is that, if sufficiently funded by self-interested parties, one can be consistently and egregiously wrong without any serious consequence. No doubt some of the stimulus –that’s my money — will find its way into the pockets of the homebuilders, who in turn will continue to finance bottom-calling by Fishkind & Associates. What is this, like the tenth time? Cue the seal.
I read the Lehigh Acres story on the NYT website yesterday. The photos in the accompanying slideshow are worth thousands of words. Left unoccupied and exposed to the elements, the bubble housing stock here has less shelf life than a Twinkie. It is indeed time to fire up the bulldozers.
For one thing, no insurer will insure a house that’s been empty for a year. Too much risk of “mold claims” (Folks these days blame Mold for their kids not doing well in school, and every problem that you can possibly imagine.)
I’ve walked into a couple of these houses that were locked up for a year with no a/c.
I’ve seen mold, green, whitish, yellowish and of course, black.
I can easily imagine ‘flippers’ painting the walls over.
I have seen rotted wood stuccoed and painted over.
The reason I stumbled in HBB years ago was searching for info on houses, building, poor construction.
Full circle.
Insurers will insure these properties (even in Florida) if they’ve been sitting vacant as long as the buyer is to be the primary resident. Also, many companies are now going to interior inspections. If there’s a mold problem they’re not going to stay on the risk…that’s for sure.
“Insurers will insure these properties”
What insurers? Not State Fahhm.
State Farm hasn’t actively pursued property insurance in Florida for many years. There are many other carriers to choose from especially in the center of the state.
“Comment by Bad Andy
2009-02-09 13:01:42
State Farm hasn’t actively pursued property insurance in Florida for many years. There are many other carriers to choose from especially in the center of the state.”
And none of them can measure up to a payout for a 30B-50B damage hurricane. The ole taxpayer will have to ante up.
That is the problem Andy..on my last visit to SFL I have noticed that in the last 24 months it has become a pure concrete jungle..with the little bit of forest left in areas,bulldozed down to make way for another vacant shopping center..cities are hoping to be able to pull in revenue from these losing investments…
My comment to my husband before the State Farm announcement was, “How is any insurance company going to afford to pay all these claims if a hurricane hit?” The answer is they can’t and risk management has done their job and told them “get out while you still can.”
Let’s see if Florida still remains “lucky” this hurricane season.
“A year later, the amendment has overwhelmingly passed and the Markowitzes are still trapped — now by the plunging real estate market. As they’ve waited for the market to return, their property value has dropped from $300,000 in 2007 to $230,000 last year.”
Yeah, that couldn’t be foreseen, right? Amendment 1 locks out all the first time buyers, of COURSE home values are going to drop in response that that kind of litigation. Worse, SOH has already made FL a terrible place for investors (in RE), so now you have the double whammy. All first time buyers locked out, and nobody willing to step up an invest in FL RE (which, admittely, is not usually a good plan to begin with!) because of the promise of insane taxation in the future. Wonderful plan Charlie.
And, as much as it pains me to do it:
““It’s a spacious 2,500-square-foot stone-and-brick-facade home with four bedrooms, a walled-in yard and an efficiency apartment in the back. Three years ago, someone paid $240,000 for it. But in about 45 days, Carline Jeudy, a single mother of four and a renter until now, expects to close on her purchase of the bank-owned foreclosure in Opa-locka for just $90,000.”
“”I never thought I would be a homeowner because of the money I’m making,’ said Jeudy, 33, a buffet attendant in downtown Miami, whose take-home pay is about $22,000 a year. ‘I never thought I could afford it by myself.’”
Take home 22K (gross about 30K), buying for 90K isn’t suicide by itself (although it’s still right on the edge of affordability). The problem here is that this women has 4!! children. That’s a disaster in the making. There’s no way in he** that she will be able to afford a home like that making 30K a year. Frankly, I don’t have any advice for her, rent is/was probably 500+ per mo; which is still quite a bit to spend, the house won’t cost her that much more. But this is just going to be a heartbreaking story when she loses this home. I don’t know how on earth you can really afford anything with 4 children on that kind of salary. I wish her the best, but, unfortunately, I see a really horrible story in the paper 2-3 years from now about this lady. She just needs to move out of FL and into some VERY rural, low cost community. She’s only making about 1/2 the median household income, and has 4 children to support. Rural GA, WV, and other parts of “middle America” would be a much better place for her to live. She needs to buy a home for 30K, and in cash.
‘Take home 22K (gross about 30K), buying for 90K isn’t suicide by itself (although it’s still right on the edge of affordability). The problem here is that this women has 4!! children. That’s a disaster in the making.’
And she works at…the Hyatt! (See above)
It’s possible she put down a hefty downpayment (savings, inheritance, gift from a family member, etc) which would make the place much more affordable. Even the basic 20% downpayment drops the multiplier to 2.4. Having said that, working at the Hyatt…. 30K can go to 0 in a big hurry.
Yeah, that’s going to be a very resilient job during a recession/depression.
I’m very sorry for this lady, this is truly a foreclosure 2-3 years from now; unless she gets a much higher paying job, there’s just almost no way that she’s going to be able to swing this.
Also, it’s going to be interesting when the tax appraiser comes in and tells her the home she bought for 90K is really “worth” 200K, and slaps her with a huge tax bill.
There should be a law against “valuing” a home over the sale price (right after the sale). The sale SETS the value. What kind of moron thinks that a home that just sold for 100K is actually “worth” 200K?
“The sale SETS the value. What kind of moron thinks that a home that just sold for 100K is actually “worth” 200K?”
A desperate and/or corrupt moron who works for the county property appraiser and needs to keep that tax revenue flowing in for the sh*tty schools and goobermint perks.
“What kind of moron thinks that a home that just sold for 100K is actually “worth” 200k?”
These morons from the Palm Beach Country Property assessors site:
” * Properties purchased out of foreclosure, by short sales, or involving creative financing schemes or non-arms length transactions such as sales between related parties, may not reflect the actual market value of a property. For the most accurate estimate of your approximate taxes, you must enter a value that reflects the actual market value of the proposed new property.”
Such bull hockey, actual market value is determined by what someone is willing to pay for a property. I can understand sales between related parties trying to scam the system, but a legit purchase involving a REO or short sale should not be included in this statement.
I called the tax appraisers office and the man on the phone said to me and I quote ” if all of the property values in Palm Beach county fell by 50%, we will just raise the millage rates to keep the taxes high. We need to pay for all of the Infrastructure developed from the new sub-divisions that were built during the bubble and for all of the new fire/police… etc…”
Well in normal times, when foreclosures are unusual and represent an atypically well motivated seller that sort of thinking isn’t unreasonable. Normally, banks are motivated to get rid of REO because they represent all cost and no benefit. This makes them more motivated than a seller that is living in the house would be, after all he is receiving HOUSING in return for his opportunity cost and the cost of upkeep. The idea is that a normally motivated seller would hold out for more, and the average buyer is unlikely to find a sellar as motivated.
But in bubbly areas of FL and CA, foreclosures and short sales ARE setting the market. Anyone who wants to can buy REO from the bank, or look for a short sale. Today, the “typically motivated” seller IS desprate.
Such bull hockey, actual market value is determined by what someone is willing to pay for a property.
“Market Value” has a definition. It’s what the market values something at.. key word “market”.
The “market” is everybody who’s involved in the RE market.
First, the entire market has to be aware of the property. The market can then compare that property to all other properties for sale and then it can decide on a fair market value.
What one person thinks a property is worth and therefore pays is not necessarily market value, though there’s a chance it could be.
For instance some secluded, cave dwelling hermit might think a 1B highrise condo in FL is worth five million bucks and pay that. He put a value on it… his own, personal value… but the sale doesn’t necessarily affect market value for that condo or for similar condos. The market would likely view this sale as an abberation, and appropriately discount this sale’s importance.
I’m very sorry for this lady, this is truly a foreclosure 2-3 years from now
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I feel sorry for the taxpayers who are underwriting all this BS. In her annual income projections I see that everybody is not counting her child support payments. IMO, that should be an extra 12k a year. No problem making that house payment.
Doesn’t matter. This lady is one illness or injury away from bankruptcy.
Who isn’t?
Good point.
It’s much worse Ben.
I see no other way of saying it except saying it, Opa-locka is a ghetto.
A very bad ghetto.
It was a ghetto back in the early 1980s.
It got worse.
Its a notorious place for people to shop for drugs. They have like “drive-thru’s” where you can buy just like ordering a big mac.
and an efficiency apartment in the back
I wonder how much she can rent this for.
Depends on the going rate for a street hussy…
She could be receiving child support.
I agree with you about this lady. No, she CANNOT afford that $90,000 house, not with four children and $22,000 take home. Insurance and taxes will get her. She might as well have an ARM.
We were paying on a $80,000 mortgage in the early 2000s, with taxes and insurance in Hillsborough it was about $700 a month at 5.5%, if memory serves. Might have been slightly under that, but not much. And mind you, taxes were relatively low at that point. We started with 7.5% and re-fied just to get the lower rate on the outstanding amount, no HELOC or anything. My memory is fuzzy here, but it seems like we were just holding the line,due to the rise in taxes and insurance and the monthly payment stayed consistent within about $30.00.
The first minor disaster, like a house repair, car breakdown, medical emergency, etc, this woman will be another foreclosure statistic.
Let her income slide a bit, and she’s going to be at 5X income. Property taxes are high here, so take that into account.
The financial destruction of others has taught her nothing. Prices sticky with blood on the way down.
You’re all missing the point… this is exactly the kind of “homeowner” politicians love. When she is 2011’s foreclosure story, you can bet there’ll be some “workout,” again, if the papers are even ever filed.
She’s genius in my book, I’m the idiot forkin’ 1G/post tax/mo. out for rent. I’d be better off buying a foreclosure, and peppering a bank with partial payments until the sun sets, then wait…
The slope is slippery, real slippery now…
What about the credit hit? A workout won’t restore someone’s credit rating.
It’s kinda interesting that while a good credit rating was devalued and even ignored as long as prices bubbled upwards, it’s value appreciates and it rises in importance as prices fall.
It seems we still hold the “credit doesn’t matter” mindset.
Sure, after a few years an FB’s history will be forgotten but that doesn’t overcome one huge disadvantage.. They restart the race from the back of the pack… and time is money.
Palmy - spot on. Someone probably lied to her and told her that there is a useful tax deduction for the mortgage interest. Useful? At her income level, no way. Her standard deduction will almost certainly exceed any house-related deductions. And the $15 credit is for 2 years, IIRC, so she probably won’t get the full benefit of that.
Who’s going to mow the lawn, spray for chinch bugs, fertilize, sprinkle, repair the hot water heater, etc.?
Very sad for this poor lady to have been given hope by some schmuck when there is none relative to this property. From FB’s we have gone to fb’s - the little guys.
And four children! The article didn’t mention child support or “supplemental security” welfare payments, so that might be an offset.
I agree - she should relocate to a place where her income might keep her housed and fed. And where she can get some free family planning advice.
In the most optimistic scenario, this may work out. The ratio is no worse than my parents with 4 kids back in the late 80s/early 90s. Of course, they were 1st generation immigrants used to saving 50%+ of their income and experts at stretching every dollar. If she can realign her thinking to be an ultra-saver and avoid a job loss, she can do it.
In these situations I always wonder where the father of these children is. Is he paying any child support? Why don’t reporters ask those questions.
If we use the 3:1 ratio, a person with a $22k income can afford something worth $66k. However, on point to keep in mind is that woman with a 4 kids and $22k income probably pays no income tax and therefore gets no benefit from the tax deductibility of the mortgage interest and property tax. So she probably shouldn’t buy anything that costs more than $50k.
“Why don’t reporters ask those questions.”
They do, but their editors alter the story to remove the venom.
Why wouldn’t she get child support to supplement her income?
Who are the daddies and do they have wages that can be garnished ?
You’re all assuming that her children aren’t receiving child support, whether from an absent father, the state, or the federal govt. Her children are almost assuredly having their food/clothing/health insurance paid for by someone other than herself.
I’m pulling for Carline Jeudy. With all the wailing and lamentations about what “victims” the poor FBs are, this side of the coin deserves more mention - that fact that housing will now become more affordable to those who scrimp and save and get their priorities in order. She’s got four kids - if at least a couple of them are industrious little buggers, who can babysit, mow lawns, etc., they can help contibute to their upkeep and to help mom turn a house into a home. Let’s keep our fingers crossed for her.
Your name couldn’t possibly be more misleading.
+1 LMAO!
First of all the home is in Opa Locka…word of advice..go the dirty Harry route and sleep with a gun under your pillow..
This is a place where bars on the windows is a considered normal decor. I wouldn’t buy there if they were giving them away for $1!
“On a recent Friday morning…laid-off construction workers in flannel shirts scavenged through trash bags at a home foreclosure, grabbing wires, CDs, anything that could be sold.”
ROTFLMAO! I’ve heard of political correctness, but that “flannel shirt” stuff really takes the cake. Great code, gotta hand it to the reporter. If it was warmer weather, the shirts would be madras. Or horizontally striped polo shirts. Plus jeans or dungarees with legs way too long for the wearers, all bunched up between the knees and the boots.
Now their wives or concubines or whatever will be squatting by the side of some roadway on the weekend with all that crap for sale spread out on sheets. Along with children’s clothing and old stuffed animals.
“That “flannel shirt” stuff really takes the cake. Great code, gotta hand it to the reporter.”
Reminds me of “BUSH TAX CUTS FOR THE RICH!!!”
This was a favorite screaming slogan of the Leftist apologists, such as excreter and banana_republik, a few months ago.
They loved to repeat it to themselves, as if in the repeating, it gained a semblance of authenticity or fact.
Of course upon analysis, it really was: “Tax cuts proposed by Bush that apply to all taxpayers; but since most illegal immigrants don’t pay taxes anyway, we call them tax cuts for the rich, because we can’t call the illegals “tax cheats” without sounding like
racists.”
It’s the maggotry class. Feeding on the carcass of a dying America. From above and below. I loved that book “Class” by Paul Fussel. What’s interesting is how he laid out the similarities between the very wealthy and the very poor and their mutual parsitism of those in between.
I remember when these tax cuts passed. A couple of MD’s were jumping for joy. Then I pointed out how much they lost to AMT vs what they saved in dividend taxes. It became clear that this tax cut was not for them and certainly not for anyone with lower incomes. It was for the class that make most of their wealth from investments. The top 1% took home most of the gains. If tax cuts are a good idea and you wanted to enlarge the middle class, then getting rid of AMT would have been the solution, and a tax cut I would support. Instead they further concentrated wealth in the hands of a few. Corporate appologists like cobalt don’t seem to get that.
President Bush’s tax cuts since 2001 have shifted more of the tax burden from the nation’s rich to middle-class families, according to a study released Friday by the Congressional Budget Office. CBO calculations
The study found that the effective tax rate for the top 1 percent of taxpayers dropped from 33 percent in 2001 to 26.7 percent this year, a decline of 19 percent. The middle 20 percent of taxpayers saw a decline of 4 percent.
People in the top 20 percent of incomes, averaging $182,700 a year, saw their share of federal taxes decline from 65.3 percent of total payments in 2001 to 63.5 percent this year, according to the study by congressional budget analysts.
In contrast, middle-class taxpayers — with incomes ranging from $51,500 to $75,600 — bear a greater tax burden. Those making an average of $75,600 had the biggest jump in their share of taxes, from 18.5 percent of all payments in 2001 to 19.5 percent this year.
Now what this doesn’t factor in is inflation which is really just another way to tax the middle class. Because of rising debt and a falling dollar the middle class saw the price of goods they need to survive increase thus there was really no tax cut for the middle class and the poor took it on the chin.
The study found that the effective tax rate for the top 1 percent of taxpayers dropped from 33 percent in 2001 to 26.7 percent this year, a decline of 19 percent. The middle 20 percent of taxpayers saw a decline of 4 percent.
This quote clouds the issue. I suspect that the top 0.1% saw their effective tax rate drop 30-40%. The effective tax rate comparison also ignores that capital gains taxes are only paid when the stock is sold.
AMT facts
1. In 2000 2% of those making 75-100k/yr paid AMT. In 2005 it was 15%. It is likely over 20% now.
2. More than half of the AMT penalty is paid by those making under 200k a year.
3. AMT tax comes to over 1.5 trillion dollars over 10 years.
A fact on dividend tax cuts.
A Gallop poll suggests that 20% pay dividend taxes. Most others hold stock in retirement accounts and there for do not pay dividend tax.
The entire system has been set up to concentrate wealth. This will surely result in an end to democracy if left unchecked.
The real problem with wealth concentration is that it leads to lower long term wealth creation. You simply end up with too few decision makers for all of the opportunities. Consider an extreme: all of the investment wealth in one person’s hands and 2 million businesses that this person owns. There is no way this one person can reasonably invest that wealth appropriately.
That is the reason Latin America never became 1st world. It makes far more sense to have economic policies which seek to spread wealth; especially into the hands of the educated, entrepreneurial & technically inventive.
+1, Jon. Testify!! Neo-liberalism at its finest.
Unbelievable, though. All these flannel shirts got paid to build a lot of sh*tty houses no one needed anyway. So that’s one expense. They may have been considered “cheap labor”, but I contend that, in the fullness of time, they will turn out to be the most expensive labor EVER in the history of the US. Because they built a lot of crappy, useless, overpriced product. Now they’re out of construction jobs, so now comes the goobermint relief, the free health care, the food stamps, the welfare for the anchor babies, the crime, the destruction of formerly nice neighborhoods, the demands for more, more, more. The demonstrations. The gangs. The increased law enforcement and jail costs.
Dystopia, here we come.
things are getting vicious here and we’re only in the third inning.
how long before Floridians start calling for deportations?
Here is something NONE of you have considered
Con Ed our utility has the highest rates per KWH in the country, why not eliminate real estate taxes on public utilities and pass the savings on to its customers…..Here is where $20-30-50 a month in savings can really make a difference in peoples lives.
——————————————-
President Bush’s tax cuts since 2001 have shifted more of the tax burden from the nation’s rich to middle-class families, according to a study released Friday by the Congressional Budget Office. CBO calculations
That’s the funniest thing you’ve written so far.
PALMETTO, I was referring to your 10:23:39 posting.
Thanks, Incred. Oh, I forgot the baseball caps with ridiculously long bills.
What’s wrong with flannel shirts? I have several, thank you very much.
Nothing wrong with flannel shirts, unless you’re a construction worker wearing one in Florida. The reporter painted a picture that some of us in Florida are all to familiar with.
Who was the jerkoff senator from Tenn (NOT algore) who wore flannel shirts.
‘The arbitrator ruled that it really wasn’t a firm commitment,’ said the Moedings’ Coral Springs-based lawyer, Scott Gelfand. ‘I expect that this will open up the floodgates,’ he said.”
I expect so, too. BK death spiral for the builders and developers. I would LOVE to see armies of people demanding their deposits back based on this.
Is polly or another legal expert around? Can arbitration rulings become legal precedent like a court ruling?
Can arbitration rulings become legal precedent like a court ruling?
Generally speaking, no. Arbitration proceedings may have a persuasive effect on other arbitrations and conceivably even on courts, but they don’t act as legal precedent the way published appeals court decisions do. They are legally binding only on the parties to the arbitration. Trial courts generally aren’t even required to use other trial court decisions as precedent. They are only 100% bound by appellate decisions.
Thanks, Chris. What’s your take on the future effect of this arbitration ruling? How much persuasive effect do you see it having? It IS legally binding, right?
It’s hard to say much about this based solely on a poorly written newspaper article. The arbitration IS legally binding on this particular family and the developer, just as if it were decided by a court.
However, depending on the language of the arbitration provision in the contract, it’s possible that the developer will try to get the arbitration ruling overturned in court. Generally, you can judicially appeal an arbitration that incorrectly applied the law, and that’s undoubtedly what the developer will argue. State laws vary a lot on whether you can appeal arbitrations, and under what circumstances.
A different arbitrator in a different case involving the same developer would probably NOT be bound by this finding, however. I’m about 90% this thing will end up going to court.
As for persuasive effect, that’s hard to say. If the developer loses an appeal in court, I’m sure you’d see every plaintiff’s lawyer in Florida get really, really excited. And probably in other places, too. I don’t have an opinion on the underlying issue, just because it’s hard to make out from the article exactly what is going on here.
If arbitration rulings are so easily or commonly appealed to a court, why bother using them at all?
Appealing a case is not the same as retrying it. Generally, you can only appeal an arbitration on the ground that the arbitrator screwed up in applying the law. It would be pretty awful if you couldn’t do that. You almost never can appeal on the ground that the arbitrator got the facts of the case wrong. An appeals court will generally credit the arbitrator’s findings of fact, and only consider whether he misread or misapplied the law.
As such, the cost-savings of arbitrations over court trials still apply, as well as the perceived business-friendliness of arbitrators. Which, of course, turned out not to be the case in this arbitration.
Within certain restrictions, parties to a contract can also stipulate that an arbitration is final and non-appealable. That doesn’t happen very often, since most people want to keep their options open.
It was generally hoped that inexpensive binding arbitration cases decided between two parties WOULD keep the Courts clear for more pressing matters I guess.
It does keep the trial courts more clear, and the more limited appealability of arbitrations probably helps keep appellate dockets slightly less crowded, too. But arbitrators have to follow the law, just like trial judges. It would be a pretty messed-up deal if arbitrators could just make up any law they wanted, without fear of consequences. Having an appeal right helps keep them within the law, basically.
ChrisO - Does this mean that the rules for appealing arbitration are the same as for appealing a regular court? Questions of law and not of fact?
If arbitration rulings are so easily or commonly appealed to a court, why bother using them at all?
It gives the developer 2 ways to win and the ability to tie the case up for decades.
Since the developer picks the arbitrator ( one of course most favorable to himself ), this is an important case.
Marriage of a condo and a Spa by Muir
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Clinique La Prairie Spa (a world-renowned spa based out of Montreux, Switzerland) plans on opening to the public on February 26, 2009 at Ten Museum Park in Miami.
There will be an ice room with snow falling from the ceiling.
That sort of thing won’t even fly in Dubai anymore.
By the way that wasn’t a joke.
There is an ice room.
Ten Museum has an 86% closing rate.
Clinique La Prairie Spa will open there.
-
Take THAT Cali!
Not to worry, Good Time Charlie’s socialite wife needs a place to soothe her stress when she’s in Miami.
Charlie may need some pampering too. I have some friends that have seen him “out” and about in these parts.
I love those types of right wingers. I mean, not love, you know what I mean!
I was taking you seriously! I just had a vision of Dubai’s indoor ski slope, and my thoughts at the time I first read of it, which were that no society can sustain that kind of perversion of the natural world for very long and still survive.
There’s a mindset in Dubai that is almost incomprehensible to Westerners. Before the housing bubble, there were in Dubai a fair number of the most beautiful office towers you’ve ever seen. Architecture *almost* worth stopping by to see. Each was owned by a different prince (unlike in Europe) there are LOTS of princes in Gulf royal families. These office buildings had average occupancy rates of, as I recall, about 20%. Didn’t matter. Oil revenues were great and each prince had to have his own status symbol.
Today the city sounds like Las Vegas, from reports I read. When oil prices rise again, Dubai will come almost-roaring back. Not so sure about Vegas.
I thought Dubai was going to run out of oil in about 12 years.
From wiki-wiki
Although Dubai’s economy was built on the back of the oil industry,[66] revenues from oil and natural gas currently account for less than 6% of the emirate’s revenues.[8] It is estimated that Dubai produces 240,000 barrels of oil a day and substantial quantities of gas from offshore fields. The emirate’s share in UAE’s gas revenues is about 2%. Dubai’s oil reserves have diminished significantly and are expected to be exhausted in 20 years.
just call it “The coke room.”
“A University of South Florida professor, quoted in The New Yorker explaining what went wrong with Florida’s housing market, used a now familiar term. ‘Florida, in some ways, resembles a modern Ponzi scheme,’ Gary Mormino said.”
Time to trot out the gloom and doom academics, say what? Where’s Sean Snaith? He said it was just a “souffle”. I wonder if he still has a job. I don’t see him being quoted much lately.
“Time to trot out the gloom and doom academics, say what? Where’s Sean Snaith? He said it was just a “souffle”. I wonder if he still has a job. I don’t see him being quoted much lately.”
Sean Snaith is selling spreadsheet souffles by the sea shore. He’s also selling toy boats — three are currently available.
Luv,
Jen
Remember when ‘ol Sean was out West, I believe in Cali, sounding like a NAR contractor? IIRC, one or more posters here said it appeared he had a few properties of his own that he needed to dump. Seems like it was at least one, given he had sewn up a job in Florida and needed to move.
“A University of South Florida professor, quoted in The New Yorker explaining what went wrong with Florida’s housing market, used a now familiar term. ‘Florida, in some ways, resembles a modern Ponzi scheme,’ Gary Mormino said.”
Modern?
Didn’t Florida have a similar housing bubble in the 1920’s?
What’s even worse is USF has a Florida Studies Dept. and has faculty books published on this very situation!!
http://www.stpt.usf.edu/coas/florida_studies/
Yes. In fact, The Marx Bros film “Coconuts” (late 1920’s) was about Florida’s Housing Bubble.
‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
It’s a very good time to SQUAT!
Hey Palmetto, did you go to the parade on Saturday? I was reading the Tribune on Sunday, and saw this gem:
“Paradegoers were more interested in sights and sounds along the waterfront early Saturday afternoon than they were in Brock Hurley’s 100-person beer bong at Wings Gone Wild on Bay to Bay Boulevard a few blocks off Bayshore Boulevard.
Hurley anticipated patrons would return after the parade wound its way toward downtown Tampa.
He invented the 20-foot-tall contraption last year when his work selling mortgages and real estate dissipated with the weak economy.
For a $10 cover charge at Wings Gone Wild, participants got a 20-ounce shot of beer in eight seconds.
“He invented the 20-foot-tall contraption last year when his work selling mortgages and real estate dissipated with the weak economy.”
ROTFLMAO! I guess you can’t go wrong serving the puerile desires of the the Gasparillas.
Yah, Gasparillafest. What an embarrassment. Says it all for Tampa.
Palmetto, you gotta know this one: How do you pick up a girl from Polk (or Pasco)?
Compliment her on her tooth!
Man, you Floridjins are JUMPIN’ today. Don’t you go leavin’ the state and old Palmy sittin’ in the middle of the Green Swamp slappin’ miskeeters.
“Don’t you go leavin’ the state”
There is a good chance I’ll be here for a while… I’m still determined to go back to upstate NY within the next year, but I gotta keep my littleman first. Florida is where my job is, even though I telecommute. It’s complicated, I believe a residency requirement will be added to my job soon; gotta love the bust.
Daddy can’t be crashing on friends’ couches anymore…
Muggy, I know you think it sucks majorly here and I can understand that. Not a fan of Pinellas County myself, can’t stand the traffic. However, I’m beggin’ ya, bro, before you permanently relocate to Rochester, try renting there for just one winter and see how you feel. walt left, I think for many of the same reasons you did, and is trying to get back here. Florida is as good a place as any to weather the sh*tstorm we’re gonna have for at least four years and it costs a helluva lot less to cool a house than it does to heat one.
I am a native of Rochester, but moved away in early elementary school. I have no memories other than grey skies and deep snow. That area has been exporting people for decades.
‘If I had the money’
And there it is. The problem wrapped up and simple.
If I had the money it would be a great time for all kinds of things like vacations, retirement….
“But no one here would describe Lehigh Acres as out of the woods. Real estate agents said the homes that were selling here typically went for only about $45,000, a third of what they cost to build.”
-
1. $45K * 3 = $135,000
$135,000 / 57 = 2368
2368 with a 360-400 sq ft garage + a small porch / lanai = your
“average” 1800 sq ft home.
So what they are saying is that at peak they built for $57 psft (under
roof)
2. $45,000 for a house in that area.
Said it weeks ago.
Saw a cent. FL condo go for $11/ft recently. Fixer-upper, of course.
Florida: no money for Medicaid, child protective services, or beds in jails; millions for plutocrats’ personal jet services.
Plane truth: Florida’s Lieutenant Governor Jeff Kottkamp’s trips home are costly for taxpayers
State aircraft at his beck and call, mainly to Fort Myers
By Josh Hafenbrack, Megan O’Matz and John Maines | South Florida Sun-Sentinel
February 8, 2009
Koffkamp to reimburse $12K in disallowed family trips out of $0.5Million in plane trips in only two years
TALLAHASSEE - Florida’s little-known lieutenant governor, Jeff Kottkamp, billed taxpayers $425,000 for 365 flights on state planes during his first two years in office, the Sun Sentinel found.
Two-thirds of the flights involved getting Kottkamp to and from Fort Myers, where he and his wife own a $1.4 million house. State planes flew empty one-way 70 times to pick him up or drop him off in his hometown, flight records show.
Kottkamp’s wife and toddler son flew for free on some two dozen trips, despite rules requiring them to pay. Those flights cost taxpayers $12,974.
In response to questions from the Sun Sentinel, the governor’s office said Friday that Kottkamp would reimburse the state for his family’s flights.
The lieutenant governor will be cutting a check for all travel incurred on the state planes by his wife and son,” Erin Isaac, communications director for Gov. Charlie Crist said. “We want to do the right thing.”
Good catch, gator. The guy oughta drive his arse back and forth, that’d be one way of getting to see more of the state. Helluva drive, though. Or, how about he just moves to Tallahassee?
He can take a fraction of his $2.3mill net worth (what he claims) and purchase a pied à terre in Tallahassee, and go back and forth every two weeks. Or whatever. He has no official duties besides being governor’s backup–can’t he use a frickin’ cell phone to keep up?
The right thing to do Charlie would be to step down. You and your socialist ways are destroying Florida even more than our housing mess. Your tax and insurance initiatives have driven out families and driven out business. You sir have failed the people of Florida.
I’m just wondering how long his “beard” marriage will last. I don’t know why he’s so afraid to come out of the closet. Wants to run for office, and thinks it matters, I guess.
LOL! I hadn’t read this yet, see my above comment.
As a republican in Florida I think it really does matter. What Charlie hasn’t realized is he’s more liberal than most democrats. Perhaps a party switch is in order.
You can’t be a real republican in Florida. You have to balance the budget.
It matters a lot in the South.
I think Huey P Long said you couldn’ get caught in bed with a dead woman or a live man.
You sir have failed the people of Florida.
You mean, the dumbasses who elected him in the first place?
What a crook, watching that video of his very awkward interview by that very crafty/pointed questioned reporter made my blood boil.
First off, he actual job is useless, he is a freaking ribbon cutter. I say get rid of his job.
He never answered the question at the very end of the interview as he was so caught with his face right down in the trough.
For him to “want to do the right thing.” comes a little late, kind of like a shop-lifter getting caught out of the door with the stolen goods stuffed down the front of their pants and offering to to pay for it now.
He was STEALING, why does he still have his job?
No wonder this country is so fuc@ed up.
Hell, If HE wanted to do the right thing, he’d have JUMPED out of the plane at 10,000 feet
Florida residents are still trapped in their homes
Although the amendment was designed to repair the damage the housing boom had on homeowners’ tax bills, “it was almost too little too late,” said Ed Wilburn, managing director of residential lending at Great Florida Bank in Coral Gables. “It didn’t slow the crisis from forming.”
The centerpiece of the amendment was portability, the ability for homeowners to transfer from one home to another up to $500,000 in property tax benefits accrued from the Save Our Homes Act. Save Our Homes caps the increase in a home’s assessed value at 3 percent a year, regardless of the increase in market value, substantially lowering tax bills. As home values soared, homeowners were afraid to move and lose the tax break.
http://www.tampabay.com/news/politics/state/article974188.ece#
The way I read it, the only people “trapped” are those who cash-out-re-fi’d or HELOC’d. How can anyone who didn’t increase their mortgage balance claim to be “trapped”?
Um, how about this. You were conservative and in 2006 you bought a $200K house you intended to live in with 20 percent down. Since then your house value has dropped 40 percent or more. Want to sell it now? Then be prepared to bring $40K or more to the settlement table.
The Horsey Bubble
A little-heralded bill intended to protect horses may be having the opposite effect.
As the economy sours in North Central Florida, the once proud horse farms of Marion County are facing tough times. Money is draining from the racing industry, which, dogged by publicity problems after the collapse and euthanization of Eight Belles at the 2008 Kentucky Derby, has come under the same pressures as the rest of the entertainment industry in the wake of the collapse of the financial industry.
Until recently, rising land prices and the construction industry generated a wealth effect that was felt throughout this country of gentle hillocks and shady live oaks. But the collapse of the local economy and the more recent losses in many retirement portfolios have left country dwellers and rich retirees alike unable to care for their horses any longer.
HR 503, passed in 2006 with little controversy, banned the slaughter of horses in the United States for food or industry. The bill was advanced with the intention of preventing the cruel slaughter of animals many considered to be next to family members–but its outcome may have been far more cruel than the glue factory.
Neglected and malnourished horses, once a rare sight in North Central Florida, have become an endemic problem, as owners whose incomes have declined are unable to keep up with the costs of feeding their animals–and find they are unable to sell a horse at any price.
The much-maligned slaughterhouse provided a floor price for horses. Today, after weeks and months of neglect, horses fall into the hands of county offices without the resources to care for them.
“At least when horses were slaughtered for meat or industry, they didn’t spend the last year of their life in misery–and nothing went to waste.” — not a gator
It is VERY expensive to keep horses as a hobby. We had some middle income friends where the wife always wanted horses and kept some on their five acres. At one time they had four of them, I think. You have to keep their pens and stables shoveled out all the time and they’re always having these exotic health problems and hoof problems and skin problems and stuff like that. The feed ain’t cheap, either. Very high maintenance. Although I did get a kick out of watching them feed on the low hanging Spanish moss. She nursed a couple of horses back to health from skin and bones, but it was a LOT of work, although she enjoyed it. But it played havoc with their household budget, for sure.
Once had a landlord who referred to his wife’s horse as The Converter. As in, it turned money into shhhh—t.
LOL,
So true but my mare is the one thing in this world that is JUST for me to enjoy and I love her so much. The therapeutic value can not be measured.
It costs me 550.00 a month to keep her in a great life with the best feed and care. It also keeps my husband happy as I am out of the house a lot and he can watch his shows in peace.
A business associate had one of those high maintenance horse owner wives, She treated her horse better than him (he’s a multi-millionaire). Needless to say, she got the horse, a house, the 2 kids, and he the alimony demand. Spoiled daughters become somebody’s nightmare.
If you have ever seen the slaughtering videos of horses in Mexico or Canada….
Their needs to be huge reform and laws created to STOP the constant over breeding of horses.
Only if you dare watch:
http://www.youtube.com/watch?v=D3YrZVKAcvc&feature=related
A horse is a magnificent animal and shouldn’t have its final days be of torture and pain and suffering.
The housing bubble has added to their suffering. There are many horses in this area that are suffering due to the owners not being able to tend to its needs.
That God for organizations like this one, located right here in Loxahatchee, Florida:
http://www.purethoughtshorserescue.com/
I’m all for horse rescue, but there are too many in need of saving.
They should have allowed some US slaughterhouses to stay open. They would at least pay to transport the animals. Now… the industry is gone. Good luck with having the local communities be able to keep up with it.
Oh, two of my coworkers alternate weekends at a donkey rescue. I applaud them for it. But demand exceeds supply…
If you can afford a horse, enjoy it. I’ll rent one for my daughter to ride if that becomes her hobby.
Got Popcorn?
Neil
I love both horse meat and fries made in horse fat.
Not all of us view them the same as you. But I agree with you that torture, etc. is a bad thing. There is room in the world for both ethics and meat-eating.
Oh, and incidentally, the world’s largest horse-meat exporter is the US (specifically: Texas.)
Hypocrisy on steroids, anyone?
I’m an unapologetic carnivore, but am sickened and disgusted by the practices that agribusiness and some farmers are allowed to get away with. Animal cruelty and inhumane conditions should get the severest kind of punishment, second only to those who neglect or abuse kids.
From today’s Alligator (a very thin edition indeed): five, count ‘em, 5 ads under “Services” for horse boarding.
I don’t recall seeing a single such ad four years ago–but I do remember seeing horse trailers being drawn all over town. Remarkable, but I don’t think I’ve seen one in six months.
I am horsey and keep several in my yard here in the Chicago exurbs. to qualify: I have been horsey all my life since I was six and my children are in the Pony Club so it’s really a “lifestyle” for us, not a hobby.
that said …
Florida is a huge destination for Eventers, Dressage, Hunter Jumper and Polo during the winter. Ocala, Wellington should be overrun with trailers and trucks and horsey people right now.
from what I hear: huge decrease in participation among all disciplines this year. I hear many Events are being cancelled due to lack of entries.
insofar as too much breeding: there’s the core of the problem. horses are still being produced like cars and houses were being produced. too many but it’s ok their value only goes up. like with housing lots of questionable quality and now you can’t PAY someone to take them away.
over the past year I have had several offers of free horses, a couple even called when they were “in the neighborhood” and offered to drop the horse off. no thanks.
horses are a liability not an asset. when folks start to realize that hopefully the breeding will slow down and the bubble population of horses will subside. for now, there are too many horses for too few homes. many should be humanely PTS.
“Creditors are lining up by the thousands in hopes of getting paid back by WCI Communities Inc. WCI filed for bankruptcy in August of last year as it struggled to pay off about $2 billion in bank debt.
ha ha ha, good luck with that. WCI was one of the worst, collapsed while others were able to stay alive somehow (they all need to go down, really).
are there any assets to be had? I doubt it. mark to market, BoA…
“The fact they have a great location and a beautiful project helps, but it is ‘only going to carry it so far,’ said T. Sean Lance, managing director for NAI Tampa Bay. ‘At some point, reality has to be faced where people aren’t qualifying for mortgages, units aren’t appraising where they’re supposed to be and measures are going to have to be taken to come up with other solutions. The next 60 to 90 days are going to be telling.’”
Hmm…what was I going to say to that? Oh, yes:
bWAAAAAHAHAHA! hihihihihHAHAHAHAHA! hehehehe!
‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
Ehhhh… I’ve got nothing. This quote is perfect in its Zen simplicity. “If I had the money,” quoth the Realtwhore, “I’d be buying homes all over Polk County.” Empty bucket, meet box of stupid.
I’ve been to eastern Polk, many times. I think I’ll pass. The only entertaining thing is Spook Hill in Lake Wales, where you put your car in neutral and it appears to roll uphill.
”’This is the only opportunity, I think, for the next 30 years,’ Fernandez said. ‘There won’t be another opportunity.’ He added that he was also bidding on a second property in the area.”
Another proud product of the Florida Public School System.
Hint: if there are no other opportunities (which is balderdash, but let’s run with this), then this rental business is not looking so bullish. Neither are home prices.
Or does he mean this is a “thirty year” housing dip? Earth to Fernandez, it isn’t, but it will be, once fools like you are flushed out of the system.
On the other hand, he did have the cash to pay for it. Betcha he’s got a cash business, too. He’s no fool. People will always need a place to live and if you can buy cheap enuf, you can cash flow.
I think it’s imaginary cash flow.
In one block on GNV, in 32601, from 8th Ave to 16th Ave, 13 st to 6 st NW, a location that is walking distance from campus, though further than the sorority girls would care to walk, rents started at $900/mo for a small ranch house.
The bank is selling these houses starting at $68,800.
So yes, it cash flows… EXCEPT:
Many of these houses have been without a tenant since August. More since January. The apt market is so overbuilt that demand for house rentals has shrunk appreciably.
I have NO reason to believe South Florida is in any better shape than North Florida–Alachua County was the LAST school system in all of Florida to have enrollment declines.
If you think it cash flows in Florida, I have four words for you: DON’T BET ON IT!
Speaking of public schools, how much taxpayer money is likely to be wasted by earmarking stimulus spending for construction of schools in areas where they’re not needed? They are closing schools around here, for gosh sake.
Now, if they’d build trade schools, I could support that. All these college kids who are taking on boatloads of debt aren’t going to have jobs waiting for them when they get out.l
I think there should be three types of high schools: Nerd schools without athletic programs (and thus a much smaller acreage footprint, equals lower cost) for nerds; high standards to get in and stay in. Regular schools as we have now, but far fewer in number and perhaps with consolidates athletics facilities. And trade-oriented schools that teach kids how to do a job that will pay well, whether it’s maintenance of factory equipment or plumbing or truck routing. Drive all pre-high-schoolers around to each and let them sort out which is more appealing.
Nerd schools exist as magnets, and they do work, and, well, we basically have all that, but kids aren’t hungry enough to jump on a trade.
they don’t fund trade schools any more… I knew kids who dropped out of regular HS to work; this was in a school system with no tech schools.
trade schools suffered because of race-based tracking–they became associated with racism. Home ec. (and with it, a whole host of personal finance and life skills education that so many of these children desperately need) was associated with sex-based tracking, and so became a symbol of sexism. the desire to ameliorate a biased system which blocked Blacks and women out of the track to the highest status and pay jobs led to the destruction of training which could benefit many.
+1, Chip.
-1.
I went to nerd school and ended up playing I-AA football. It wasn’t like Oklahoma, but we get a pro-baller every now and again. Can’t keep us in server rooms and laboratories getting more like blind cave newts!
Hey HBBers, I’d like to ask you guys about the Pennsylvania/Western NJ rental market.
In short: I’m going to start medical school @ UMDNJ in Stratford, NJ next year. I’m well aware of how lousy the NJ real estate market is. I went to look at some Stratford apartments in December and was shocked to see how crappy the apartments were - 1 or 2 bedroom apartments were going for $800-1000/month, and these were poorly kept at that. (This is about double the price of Cleveland (my hometown) apartments of the same sq. footage.)
So, I have 2 questions:
1. In terms of “bang for the buck”, where is the best rental property in the suburban Philadelphia area located? (Stratford, NJ is perhaps 10 min from downtown Philly.)
2. Basically, does a high level of foreclosure activity tend to drive down rental costs as well as overall home prices? The snooty lady pushing these dumpy apartments seemed to think that high levels of single-family house foreclosures would increase demand for her apartments, while I’ve heard it said many times that ALL rents tend to fall when there are many foreclosures on the market. She did figure that renting a house in NJ would be a lot cheaper than renting an apartment because so many REO houses are now being rented out by banks…but she also thought that the tidal wave of people leaving those foreclosed houses would help drive up rents on apartments. What say you?
Shelter is shelter. Given the choice would you rather rent a house or an apartment?
Unemployment and people getting booted from houses is downward pressure on prices. If they can’t afford it they won’t rent it.
Without the tax break people can’t afford even as much for rent as they could for a house payment.
Where does she think people are going to get their rent$$?
Take a look in the Pedricktown area. It’s in the middle of nowhere, but very commutable to Philly and incredibly cheap. It’s in NJ, over the Commodore-Barry bridge. There was quite a bit of building there during the boom, and plenty of McMansions and other white-elephants to choose from in that area. It’s farm country, and actually a very nice place to live; assuming that you don’t mind the quite life.
If you live or work in Philly, you pay the Philly wage tax (about 4.2%).
PA has a lower income tax than NJ (by about 50%) and both NJ and PA have an agreement to charge based on where you live (ie, if you work in NJ but live in PA you pay the PA state income tax).
So I would suggest finding a place in PA NOT in Philly.
Are you on a fast train line? Look at walking distance (1.5mi) around all the station stops (do check schedule to make sure you get late night service, indispensible for college students).
Often you will find a town that is a bargain. You’re young and unattached; I would not be too worried about safety unless it’s some sort of gangland drug emporium. Then I would stay away.
Thanks all.
“You’re young and unattached…”
I forgot to mention that I’m married. That said, the current housing my wife and I are living in borders Cleveland’s East Side - a region that rivals anything in America for sheer ghettoness. Consequently, we can tolerate shabbiness in a town…but not an utter lack of safety.
The point about PA having a lower income tax than NJ is a good one. My wife is currently finishing a nursing degree and will (hopefully) be able to find work as a nurse somewhere in the area. Having to deal with only half the income tax burden would certainly help the finances. In light of this, I’ll start looking more closely at PA’s housing.
Dear UMDNJ’er. I just recently graduated from UMDNJ-SOM. I grew up in Voorhees, and really have lived her just about all through college and med school, and I ended up living in Blackwood, NJ while doing residency in Camden.
As for living in a convenient area near the school, there are loads and loads of rentals in the area, and ner the school in Stratford is generally much older and it’s not a very affluent little town. It is nestled among other nice towns, and those of us from here do have an inside handle on the relative differences in the per capita income so to speak.
If you want a town house or apartment, look in the towns of Blackwood (specifically the Valleybrook community), Erial, and Voorhees areas. Any good realtor will know where to find these. Don’t settle for some crappy realtor who is trying to push a dump. And, remember, some of the ones closer to the school will likely have been rented by those in school there and may not have been the cleanest of tenants.
Another area to check, though not as nice as the above, is a townhouse rental property off of West Park Avenue in Lindenwold. I can’t remember the name, but there’s only one on that road.
Pedricktown is way too far so don’t look there.
As for prices, it’s not Cleveland. You’re in the worst taxed property in the country and it’s relatively more expensive. Philly has some options too, but remember up here in the northeast, generally things are a bit more expensive.
Good luck!
I know this is the Florida thread, but I just had to share my fave headline of the day:
USA Today
FBI probing peanut products
Yikes..Today they come for Mr Peanut, tomorrow they come the M&M’s
As they’ve waited for the market to return, their property value has dropped from $300,000 in 2007 to $230,000 last year.”
BWAHAHAHAHAHAHAAHAHAHA! HEHEHEHEHEHEHEEH.
How’s that “waiting for the market to return” strategy working out for you, greedheads?
There’s flat out no excuse for that kind of behavior. Not just the lost money but the lost opportunity costs!
“Welcome to the American dream in high reverse.
More like American greed in high reverse. Ain’t consequences a bitch.
As just weeks remain before the $170 million tower welcomes its first residents, Gulf Atlantic Communities Inc. is offering buyers ’significant’ reductions on pre-construction prices, a bid some observers believe is a consequence of unfriendly appraisals.”
ROTFLMAO. It’s finally dawned on some of these “investors” that they’ll be moving into a Tower of Rabble as flippers and FBs walk, and “community activists” start showing up with groups of homeless people to lay claim to empty units - with no fear from cash-strapped authorities who’d prefer to look the other way.
That whole waterfront is going to look like something out of “I Am Legend” in another couple of years. Zombies and all.
‘If I had the money, I’d be buying homes all over Polk County,’ said Pauline Dickson, the association executive for the East Polk County Association of Realtors. ‘This is a very good time to buy.’”
But you have no money, Pauline, because YOU’RE NOT SELLING ANY HOUSES.
laughing out loud, Sammy–you nailed it!
Financial Times
Mortgage subsidy scheme draws fire
By Alan Beattie in Washington
Published: February 9 2009 21:56 | Last updated: February 9 2009 21:56
The competing versions of the US economic stimulus bill to be negotiated between the House of Representatives and the Senate this week contain little directly aimed at stabilising America’s ailing housing market.
Congressional Republicans have tried to introduce a broad plan to subsidise mortgages, and have succeeded in getting a smaller proposal adopted to give a tax credit to homebuyers. But those ideas have come under fire even from some Republican-supporting economists, who say they will do little to address the most troubled parts of the housing market.
My take: (1) Zandi is a bottom-calling cheer leader; (2) Noone really can predict when the market will bottom out, but if it is immediately after a period of rising unemployment, it will be unprecedented.
US home prices to hit bottom at year-end: study
7 hours ago
WASHINGTON (AFP) — The freefall in US housing prices that sparked a global economic crisis will ease by the end of 2009 but not before another leg down, resulting in a 36 percent slide, a study said Monday.
The report by Moody’s Economy.com said home prices in the 381 US metropolitan areas have already dropped an average of 25 percent, and will slide a further 11 percent before stabilizing.
“Notwithstanding the intensifying economic gloom, the bottom of the housing downturn is within sight for the nation,” said Mark Zandi, chief economist of Economy.com and an author of the report.
“Presuming we see strong action by policymakers to help support the economy and the housing market, prices will begin to recover by the end of this year.”
Maybe so Mark Zandi but I doubt it….. And you will be “amending” your statement like so many thousands of bond ratings your shi*%%y company provided to create this economic clusterfu#$k.
The bottom will remain one year out into the future until the day it arrives (a variant on the stopped-clock forecast).
You only learn who has been swimming naked when the tide goes out. Wall Street has turned out to be a nudist beach, basically.
– Warren Buffett, September 2008 –
‘Florida, in some ways, resembles a modern Ponzi scheme,’ Gary Mormino said.”
I think it was more of a kids game of hot potatoe. The last person holding the deed to the property gets financially burned!