Guess What? Now It’s Tomorrow
The New York Times reports on Arizona. “Phoenix has achieved the unwelcome distinction of becoming the first major American city where home prices have fallen in half since the market peaked in the middle of the decade, according to data released Tuesday. ‘Even during the Depression, I’m not sure prices fell this quickly,’ said Karl Guntermann, a professor of real estate at Arizona State University.”
“Greg Swann, a Phoenix real estate agent, took a moment to marvel at the news. ‘What happened here will some day be a new chapter in ‘‘Extraordinary Popular Delusions and the Madness of Crowds,’ the classic survey of investing mania, he said. ‘We were living during the boom like there was no tomorrow. And guess what? Now it’s tomorrow.’”
From CNN. “It’s a buyers market again for condominium shoppers after years of artificially high prices and speculation. ‘”We want to move the products as fast as we can,” said Summer Dunham, marketing manager for Starpointe Communities, which develops luxury condominiums in Scottsdale, Arizona. ‘It was very slow in 2008. Everyone had difficulty selling.’”
“So in February, the determined company auctioned off 20 four-story condominiums overlooking a golf course, private park and three swimming pools against a mountain backdrop. The upscale properties were priced as high as $1.6 million before the market sank. And bargain hunters were jazzed to pay, on average, $600,000 for a unit at the auction.”
“‘Developers will bend over backwards to sell these units,’ said Brad Hunter, chief economist at Metrostudy. ‘There is no limit on the number of ways they will work with someone to sell at this point.’”
The Arizona Republic. “One of the Phoenix area’s largest commercial developers is showing signs of financial stress that local experts say is a symptom of widespread economic problems facing the industry this year. A group of lenders led by Bank of America has filed a complaint in Maricopa County Superior Court claiming that Opus West Corp., based in Phoenix, owes the banks more than $160 million in unpaid construction loans, interest and legal fees.”
“It is an operating company of Opus Corp., based in Minneapolis, and developer of projects such as Tempe Gateway in downtown Tempe and the Scottsdale Waterfront Residences high-rise condominiums. A developer that borrowed the maximum loan amount at peak real-estate prices generally owes 80 percent of what the project cost when the market was still hot. Not only have property values declined, but lenders have pulled back on the portion of a property’s value they are willing to lend. It’s more like 60 percent now, said Mesa real-estate investor Michael A. Pollack.”
“Therefore, any company hoping to refinance a construction loan would have to come up with enough cash to cover the property’s lost value plus 20 percent of what the bank had originally loaned. ‘There’s no question, there are projects out there that are highly overleveraged,’ he said.”
“The same government agency known for certifying the quality of hamburger and steak is becoming a prime force in the Arizona housing market. The U.S. Department of Agriculture has guaranteed mortgage loans for many years, much like the Federal Housing Administration and Department of Veterans Affairs, but this year the value of Arizona loans guaranteed by the USDA is on pace to quadruple compared with 2008.”
“Buckeye newcomer Geanna Gute was approved for a USDA loan recently and said she had never imagined owning a home would be so affordable. Gute…who had been a longtime renter in the Valley…purchased a pristine 1,860-square-foot bank-owned home, built in 2005, for $75,000. It had been appraised at $200,000 in October, she added. Gute said her monthly payment is $650, and the only thing she had to pay for up front was a re-shoot of some inspection-related photos.”
“‘I had to pay $60 - that’s all I paid,’ she said.”
The East Valley Tribune in Arizona. “Buying a home in Mesa’s 85206 ZIP code has John Karreci beaming like the cat who swallowed the canary. He and his wife are purchasing a 2,700-square-foot, six-bedroom home. ‘They accepted our offer for $175,000 on a house that four years ago was sold for $450,000,’ Karreci said. ‘They were asking for a little over $200,000 … so that was a smoking deal if you ask me.’”
Inside Tucson Business in Arizona. “With foreclosures driving down home prices, KB Home is facing the competition head-on with a line of new homes it’s calling the Open Series. The home at Sonoran Ranch on the southwest side is priced at $89,999…an effort to compete with foreclosures, and offer affordability.”
“John Strobeck, whose firm Bright Future Business Consultants tracks Tucson data for the home building industry, said two years ago he never would have believed a new home would be for sale for less than $90,000. Besides KB Home, DR Horton and Pulte Homes are offering new homes starting at $99,990. ‘Last month, the median foreclosure sale was in the $130,000 range,’ Strobeck said. ‘So we absolutely have to come down below $150,000. Two years ago we had no homes sell for under $150,000. Last month 14 percent of the homes sold for under $150,000. We are trending downward and I am for that.’”
From Reuters. “The downturn has downsized both Meritage Homes Corp and the U.S. housing industry in more ways than one, a Meritage executive told Reuters. The Scottsdale, Arizona-based homebuilder is implementing a plan to build cheaper houses that can compete in foreclosure hotbeds such as Arizona and California by shrinking the square footage, stripping out some amenities and simplifying the architecture.”
“The builder has already begun buying ready-to-build, deeply discounted lots where it can locate its cheaper product in Denver, Colorado; Phoenix; Orlando, Florida and in California’s East Bay and Inland Empire. Meritage is driving sales by demonstrating that it can be cheaper to buy than to rent, said Chief Financial Officer Larry Seay. ‘It’s almost like a price tag on a car,’ Seay said. ‘There’s a permanent overall market withdrawal from offering those lavish homes. The McMansion is on the outs.’”
The Miami Herald. “Lenders this week stopped funding construction of the Fontainebleau Las Vegas, endangering the biggest real estate project in the Soffer family’s portfolio. Launched at the same time Jeffrey Soffer purchased the Fontainebleau Miami Beach, the Vegas property was slated to launch a global string of Fontainebleau casinos.”
“But a depressed real estate market foiled plans to finance much of the effort by condo-hotel sales, and a sharp decine in Vegas tourism led analysts to warn the property wouldn’t be able to make debt payments once it opened. Soffer accuses the banks of reneging on a deal to fund the Vegas Fontainebleau through completion.”
”’We need them to live up to their promises so that we can complete a landmark project that will revitalize tourist visitation to Las Vegas,’ Soffer said.”
The Casino City Times in Nevada. “MGM Mirage CEO Jim Murren said last month he harbors no ill will toward people who think the company will fail. ‘I have no illusions that this is going to be easy,’ he said during a conference call with analysts last month. ‘We will take every question, we’ll take every criticism, and we’ll own it all.’”
“In December 2007 Murren’s predecessor, Terry Lanni, became the first casino executive to publicly acknowledge that the banking crisis, seemingly confined to Wall Street, would hurt consumer spending. His prediction of a ‘difficult’ 2008 came at a time when the spreading housing crisis was registering in Las Vegas, but the effect it would have on gaming wasn’t.”
“In fact, a key segment was already pulling back. Tourists who could least afford the luxury boom were visiting less frequently, in part because of the housing slump but also because they had been priced out of Las Vegas, where budget rooms were going for more than $150 a night. The humbling circumstances have led to humble statements by industry leaders, including one of its most flamboyant figures.”
“Steve Wynn bragged of his company’s relative financial stability heading into last year’s economic meltdown, but also warned of trouble ahead. He told investors in the fourth quarter of 2007: ‘It would be unsophisticated to think that Las Vegas is somehow a magical island unto itself, immune or isolated from the effects of the cities and the communities that serve it with its visitors.’ He has grown cautious in his commentary, telling investors in a February conference call: ‘I think that trying to give you guys rosy pictures and all that kind of jazz on these conference calls is a real disservice. I think what we ought to do is discuss what has been and be candid about what we think may be.’”
The Review Journal in Nevada. “Real estate agents with Liberty Realty in Las Vegas were left with unsigned commission checks that couldn’t be cashed when the office shut down last week, one of the agents said. In an April 22 memo to nearly 800 agents, Liberty Realty CEO Richard Bell said the agency is being acquired by Century 21 Aadvantage Gold.”
“The Liberty agent, who requested anonymity, said police were called to Liberty’s office Friday on Durango Drive to ‘calm the situation down’ and escort Bell from the building. ‘There’s a lot of upset brokers,’ the agent said. ‘I’m carrying around a $3,600 check that’s no good. They took the money out of escrow and arbitrarily passed it out to other agents.’”
The Salt Lake Tribune from Utah. “The median selling price of existing homes in Salt Lake County is now down to $240,000, off 6 percent from the height of the overheated market two years ago before home sales began plunging. Steve and Sarah Brown put their home in Holladay on the market and are looking for a great deal, perhaps a property that has been foreclosed or a house sitting vacant. The Browns have debated moving for some time. Why move now?”
“‘There are so many deals and incentives right now, buyers are saying, ‘I can’t afford not to buy,’ Kirkham said. ‘My feeling is that we’ve probably already bottomed out. I’ve sold real estate for 16 years, and my sense is we’re moving in a positive upward direction now.’”
“Home builders say a state grant program designed to entice Utahns to buy new homes is working, with people flocking to take advantage of the $6,000 incentive and creating a demand that they hope will get the construction industry moving again. To date, the Home Run Program has awarded more than 530 grants to homebuyers, about $3.2 million in all. But not all of the grants are going to prospective homeowners who are scraping together money to buy a house.”
“In fact, there is no limit on the price of homes that qualify for the program. As a result, a handful of the 312 taxpayer-funded grants awarded in the first month have gone to help buy homes worth more than $500,000, with one home purchased for more than $700,000.”
“‘Is that the best use of public funds?’ asks Steve Graham, director of the Utah Community Reinvestment Coalition. ‘Obviously the Legislature and the governor felt it was. I focus on affordable housing, so certainly we would have loved to see that kind of funding go to low- and moderate-income homes.’”
“But, Graham said, the program was aimed at recharging the construction industry, not helping people afford a home. ‘That is a little difficult to swallow. I think people, their eyebrows should rise a little bit,’ said Graham of those unusual cases where the grant was given to high-priced homes.”
“Sen. Wayne Neiderhauser, R-Sandy, who was on the committee that formulated the program, said there was discussion of putting a $400,000 cap on the value of the home prices. That was ultimately abandoned in favor of income limitations of $75,000 per person or $150,000 per household. But homeowners who have equity in their existing home could sell and get the grant if they want to upgrade.”
“‘We knew there might be a couple of the outliers,’ said Niederhauser, ‘but we weren’t that concerned as long as the bulk of the homes were in range of the target we had.’”
“Curt Dowdle, executive officer with the Salt Lake Homebuilders Association, of the Homebuilders group, said that, in hindsight, some price restrictions probably would have been helpful. ‘I think [the Legislature's] intent was to apply it to people who really needed the help,’ he said. ‘I think there are some cases where this grant didn’t really go to people who needed it. But you’ve still stimulated a transaction. It’s been the single greatest stimulus that the local homebuilders have had.’”
The Deseret News from Utah. “A few weeks ago, I told you about Laura and her husband, who were hit hard when the local housing bubble burst. Laura wrote that her husband spent eight years as a real estate investor and was doing well. Then the economy turned sour, and they were stuck with eight houses they couldn’t sell. She was wondering whether there was any way they could avoid bankruptcy and foreclosure.”
“I have been surprised at the number of reader responses to Laura’s situation — and the emotion behind them. One reader, Denise, wrote that she and her husband moved to Utah three years ago. They want to buy a house, and they have great credit scores and plenty of money for a down payment. However, they still haven’t found the right home.”
“What’s the problem? Denise says she blames both homeowners and banks. She says she and her husband have bought and sold houses in all parts of the country and recently sold a home in this down market. ‘We are not unacquainted with the dynamics of this market or selling homes in general,’ Denise wrote. ‘The key, my homeowner friend, is to sell for what the market will bear, which most of you are not doing. You want too much for your house. You want a retirement nest egg in one fell swoop. You want a return on investment of 50, 100, sometimes even 200 percent. Whatever happened to a nice 8 percent return, or just breaking even?’”
“‘In just a few years this nation has deluded itself into thinking that homes are a fast track to wealth, that everyone everywhere makes MONEY on their house. … You want premium pay for a tired, rundown, outdated house. … Whatever the circumstances are, the simple truth of the matter is, it will only sell for what someone else is willing to pay for it.’”
“Denise feels banks are an even bigger part of the problem. She wrote that she and her husband have been lied to and put on hold by banks during their search for a home. ‘Everywhere you hear about short sales and foreclosure properties and what a great deal you can get. We have yet to even come close to such a deal. The same answer applies: greed, pure unadulterated greed,’ she wrote.”
“Another reader, Fred, suggested in an e-mail that Laura and her husband need basic training on how real estate markets work. ‘The mentality that people think you can borrow money to buy real estate and then expect that real estate, purchased with borrowed money, to generate enough income to both pay for the mortgage and to support their lifestyle is absurd,’ Fred wrote.”
“Real estate values are closely tied to average incomes, Fred went on, and a home should cost about three times a person’s annual income. But in the explosive market of a couple of years ago, average home prices were five or six times the state’s average household income. ‘Get a clue: That’s a sure sign of an unsustainable bubble,’ Fred wrote. ‘No one can afford to buy a home unless they already have a falsely inflated home they can trade up from. We knew home prices (would) eventually have to drop to realistic levels before we (could) move forward in this economy. …’”
“‘We need to take accountability for our choices, or in the case of this couple, for our gambles. They were speculating, not investing. There is a huge difference. They need to learn the difference and act accordingly. Gambling is a fool’s game.’”
The Colorado Independent. “In a windowless room at the Westin Hotel in downtown Denver, leading business journalists and editors explained how the media ‘blew it’ in covering the economic meltdown. They admitted, on one hand, to falling under the sway of free-market ideology and celebrating risk-taking financial leaders and, on the other, to missing the complex story of the rupturing system by only reporting it in parts and to almost no effect for the past decade.”
“University of Michigan business professor Greg Miller said that the finance beat had simply grown too complex and compartmentalized for journalists to cover well in the traditional way. ‘No one banker could walk me through securitization in 2006,’ he said. ‘They’re all specialists.’ He said bankers rely on other specialists to take up the slack. ‘They don’t know even know each other’s names,’ he said.”
“Veteran TV journalist Allan Dodds Frank…said that complex economic stories were virtually impossible to sell to his editors. ‘Fannie and Freddie were not covered on TV because there’s no visual,’ he said.”
“He said journalists couldn’t figure out what ‘Wall Street was doing’ and that high-rolling CEOs and fund managers were never compelled to answer tough questions. ‘We soft-balled them because we wanted them to come on [our shows] … we let them hide the ball on us.’”
“Coveted interviews with CEO celebrities had moved investigative pieces off of edit calendars. ‘The glamorization of business news [led us] to adopt a posture of reverence [toward our subjects] … We knew it was nonsense,’ he said.”
“The laxity of federal finance regulators went unreported in The New York Times and in other publications, admitted New York Times Business Editor Larry Ingrassia. ‘The [finance industry] lobbyists had more impact on the regulators than we did,’ he said, pointing indirectly to the expanded influence the financial sector came to wield in Washington over the past three decades.”
“‘We drank the Kool-Aid,’ said Jane Bryant Quinn, personal finance columnist for Bloomberg and Newsweek. ‘We believed that free markets were the best kind [of markets].’ She said it had become ‘unfashionable’ over the last three decades to write about regulation, so they didn’t. ‘We could say things were risky … but we never said ‘Where’s the Fed?’”
‘‘I had to pay $60 - that’s all I paid’
I don’t wish misfortune for this lady. But here we sit in 2009 seeing reports of no-down loans. Is this really the answer Washington?
Here’s another gem: “Meritage is driving sales by demonstrating that it can be cheaper to buy than to rent, said Chief Financial Officer Larry Seay.”
AFAIK, rental properties don’t come with an obligation to repair and maintain them. That’s the landlord’s responsibility. And it can be quite an expensive one, as any landlord or homeowner can attest.
We’re seeing rents drop because of vacancy. It is a full scale race to the bottom.
Here in my area of Seattle, rents don’t appear to have fallen much. There’s a bunch of new apt buildings coming online, but they’re all fancy high-end and looking to charge $1200+ (up to $4k) for a one-bedroom. I have a strong feeling this will fail, and rents will come down once they realize there’s no market and people can’t afford it.
Still, sadly, there’s the time lag until they figure that part out.
If you actually did some research, you’d find they’re down ~16%.
That’s pretty harsh, BB. As I said, “in my area of Seattle”. If you want to point me to stats that West Seattle rents by the Alaska Junction are down 16%, be my guest…otherwise, I’ll stand by my anecdotal evidence based on CL listings and discussions with the property manager here.
I don’t doubt there’s downward pressure on rents. However, as far as I can see, houses in this area rent very quickly as well (within a few days)..can’t speak for all of Seattle, nor anything outside of the area at the junction.
But please, do continue to castigate me for not doing research before posting anecdotal observations. Sheesh.
I was actually looking at a home built by Meritage. I did some research and found a crapload of complaints against them. In this market the only way they can make a profit is by building crap. But even in a good market they did the same thing.
Built crap.
Personally when I see this the only question that comes to mind is…
“Where’s the beef?”
Is this really the answer Washington?
It seems to be - at least for the foreseeable future.
FHA loans in SoCal used to purchase homes a year ago were less than 5% of the total - now it is approaching 40% (it will probably go above 50% in 2009). And those FHA deals are at 3.5% down.
To a large extent, the “lending practices have returned to the old days” meme just isn’t true….thanks to our government. “No-down” and “low-down” loans may be gone in the private sector, but the Feds have picked up the slack.
How long before the FHA starts doing loans with teaser rates and 125% HELOCS. Don’t laugh, I wouldn’t put anything past these guys with what I have seen so far.
The Wall Street pukes get to run the printing presses.
J6P gets to borrow more money, if he is willing/able.
It’s the only bone they are going to toss J6P.
Buy now, or be priced out forever.
“I don’t wish misfortune for this lady.”
Does it make me a bad person to say…I do?
Yes
No. That does not make you a bad person.
“The laxity of federal finance regulators went unreported in The New York Times and in other publications, admitted New York Times Business Editor Larry Ingrassia. ‘The [finance industry] lobbyists had more impact on the regulators than we did,’ he said, pointing indirectly to the expanded influence the financial sector came to wield in Washington over the past three decades.”
—————————-
And they wonder why they are a failing business…
They were too close to the problem…….didn’t want to write stories bad-mouthing the majority of their readers.
That, and IMO, most journalists aren’t the sharpest tools in the toolbox. Add to this a little laziness…..
Remember the homers that ran your high school newspaper? They are usually the same homers that are now publishing your local newspaper.
Don’t get me started about the serial jock-sniffers, who buddied up to the jocks to bask in the glow, and are now Sports columnists and sports-talk-radio hosts.
“That, and IMO, most journalists aren’t the sharpest tools in the toolbox. Add to this a little laziness…..”
Easy, you’re talking about my mom. Actually, I knew a lot of editors and journalists growing up, and many of them are very bright, critical people and have seen multiple aspects of the world and so are capable of holding a complex worldview.
People who present the news on television, or who have a large presence in the media, like Thomas Friedman, are not really journalists, they are celebrities, and the main job of a celebrity is to be famous. But there are good journalists who make real sacrifices to get stories out, and most of them are not household names, don’t make much money and work their bums off.
The companies they work for often have an agenda (not a sinister agenda, necessarily, but they want to appeal to a certain demographic, or not offend a particular advertiser). This influences what stories are filed.
If you talk with a journalist, you will find that many of them have had important parts of their stories edited/rewritten/dropped at the last minute. Sometimes it’s as a simple as that there was a last-minute advertisement added to the page where the story is run, and a a few paragraphs are cut at the last minute to accommodate the space for the new ad!
Unfortunately, you need an organization behind you to pursue certain types of stories. To pursue a complex story, which takes weeks, even months, sometimes involving travel, bribes, translators, or other things you need MONEY and a network of contacts behind you. Blogs are great resources for relaying, collecting and critically evaluating information, but I don’t currently see them as a replacement for a good news organization - they are a complement.
People who succeed in journalism, just like any company structure, are often yes-men type people. It’s risky to gather damaging information on powerful people. It’s risky for an editor to run a story attacking powerful people. Yet there are people who do this (even risk or lose their lives covering dangerous conflicts) even though their big reward is a much smaller readership than if they were writing about Lindsey Lohan’s latest underwear or writing inane editorials funded by a special-interest group.
Also, if you are the type of journalist who files stories which are basically rewritten press-releases, you get less trouble and more money. Most people are not interested in complex analysis and detailed reports, they are interested in big, dramatic stories like that stupid octuplet mom story.
When I was a child I met a journalist who was one of the few photographers to cover the Cambodian massacres under Pol Pot. He was very scarred and I would say crazy from going through that. He had had to risk his life and witness terrible things to get that story out. He remained in Southeast Asia, and I think he had lost the ability to have a family or any kind of normal life. His hotel room was covered with images of dead and sick people that he had photographed and filed. Think of the people who covered also East Timor, Chile, Rwanda, the tobacco industry, child abuse in the Catholic Church. These stories don’t just happen, and they involve taking on powerful and sometimes dangerous organizations. They also require people with a strong, critical mind and good training to take it on in the first place.
At least 109 men and women lost their lives covering stories last year. They are not all tools and I think it’s a mistake to dismiss journalism and the MSM as a whole.
But if you would like to mock/fire Dana Milbank and most of the Washington press corps or everyone at CNBC, I am right behind you. (And the worst thing about those guys is that a lot of them actually do know better and have contempt for their readers - you will never hear more cynical and hair-raising stories than in a press club at happy hour, I think.)
I don’t know the best way to support great journalists right now - infrastructure, funding, letters to the editor and advertisors for a job well done? But I keep hearing the whole “MSM” written off, and I think it’s throwing the baby out with the bathwater (sorry for the cliche). No matter what, terrible things happen in the world. But in the absence of strong, critical media, terrible things happen with no opportunity for opposition.
Well said [written] and thank you.
You must have been dringing the media kool aid. The reason the newspapers didn’t expose the real estate scam can be found in the weekend editions. If you take the queens shilling you have to do the queens bidding.
Ella, that was one of the best op-ed’s I’ve ever read– here or anywhere else. True journalists are a rare and precious breed. You did your Mom proud!
Magnificent invective.
X-GS,
Sadly it looks like they are closing the Cessna plant in Bend, OR w/ more layoffs planned elsewhere. Again, what DOES one have to do get outside the RRE ( REIC Ripple Effect ) ?
Shoe horses?
Sadly, Mr. Pelton wanted something to compete with Cirrus. Wrong time, wrong plane, and no W.A.H.(Wife Acceptance Handle- aka- BRS Chute) Kinda like building McMansions to compete with Khov in 2006- you’ll both loose.
That’s what you get from a CEO with a Fake Degree.
Gregg Swann? HA HA HA. The same Gregg Swann that said Phoenix r/e could never go down in price because of year round golf. This stuff gets better every day.
“Greg Swann, a Phoenix real estate agent, took a moment to marvel at the news. ‘What happened here will some day be a new chapter in ‘‘Extraordinary Popular Delusions and the Madness of Crowds,’ the classic survey of investing mania, he said. ‘We were living during the boom like there was no tomorrow. And guess what? Now it’s tomorrow.’”
Yeah..right Mr. Bird Of A Feather. The RE “Black Swann” guru never saw his relatives coming in to ROOST before these RE Revelations became MSM Sexy.
Spare me your new found Wisdom and Insight Oh Prophet.
mikey,
I’m really torn on even -responding- to these failed idiots and their doomed “opinions”?
I’ve been on our HOA prez. for 3 months over what virtually -any- right thinking neighbor would describe as a sewer leak! On one side of our condoze we have an overflow that pumps grey water into the pharmacy’s delivery area!
I said, when it stops raining ( and one day it -will- ) that soapy water w/ denim lint in it will be a LOT more obvious! ‘His’ solution? Contact our local FAILED BANKER that (once) had an interest in the property and get HIS… “opinion”!
Are you F@CKING KIDDING ME!? Tell me you’re kidding, right? The guy ran the local bank, his investors ( GOD knows how many suppliers, vendors and employees ) not to mention an -entire town- right into a smoking HOLE but we’re going to seek his opinion on this? Or… ‘anything’? Puhleeze.
If we have to go to TurboTaxTimmay to figure out how to deal with Wall Street crooks, then this kind of logic makes total sense to me.
Welcome to Idiocracy v2.0
Go away! I’m bate-ing
DinOR
HOA Prez is a tough job these days. My friends retired parents are in the Florida mess and her Dad is trying to hold their condo association together. They have actually been trying to dump their own codo and move to NC to be near her. Nothing is selling. She feels that this extra stress isn’t good for him as he is not in good health.
mikey,
I definitely appreciate where they are coming from, and we hear the horror stories every day. In ‘our’ particular instance we have a grand total of 5 units and everyone is current. There’s only 8 members total so that really hasn’t been the issue.
The Prez is good friends w/ our local bank failure founder and it just irked me endlessly that he put helping his pal ’somehow’ redeem his public image BEFORE basic sanitation and OUR legal liabilty!
Imagine for a second that a pharmacy *isn’t your neighbor? You have a regular neighbor. How long is HE going to tolerate having sewer water flushed out onto his lawn? Not long. Where’s the concern for MY… public image! “Oh, do YOU know DinOR? You mean the guy that uses the neighbor’s lawn for a cesspool?”
You can buy ’sewer dye’ [food coloring basically] to see whose sewer is whoms
Hopefully Gregg is not black.
PB,
I…. don’t believe so? Not that being a White Swan would in any help his reputation. I think Darrell may well be right, Phoenix: The Detroit of the Great American Southwest!
My point was that on virtually every level, REIC players are desperately trying to re-invent themselves. Kind of working off a Jim Cramer/Donald Trump Model of: As long as people are ‘talking’ about me?
I’ve had to confront it locally and I’m tempted to think the best way is to just ignore them altogether? Thoughts people?
Here’s a thought: I attend (and photograph) a fair number of community events here in Tucson.
If they are of the business variety, I find that the REIC attendance isn’t as heavy as it was a couple of years ago. And when I do see REIC-ers, well, let’s just say that they’re looking awfully subdued.
And, in event photography, it’s important to find people who look animated. So, I point my camera at the non-REIC types. Makes for much livelier photos.
I couldn’t believe it either! Could it really be the same Greg Swann? I remember his “professional athletes” argument as well.
Here are his 21 reasons to bank on Phoenix’s real estate, from Greg Swann’s blog:
In any case, here do I compile my list of 21 really good reasons to bank on the future of the Phoenix area real estate market:
The migration from the Snow Belt states to Metropolitan Phoenix has been unabated for 60 years.
A similar extended migration is now occurring from the Northwestern states and Western Canada.
The “installed base” of all those migrants brings a steady stream of extended family members.
Proposition 13 makes moving up difficult in California; many Golden State sellers buy in the Phoenix area.
Californians in pursuit of other objectives — e.g., a friendlier business climate — migrate to the Valley of the Sun.
Baby Boomers will retire in droves to warmer climes — the Atlantic coast, the Gulf states and the Southwest.
Among those locales, Phoenix is by far the least prone to natural disasters.
Because of this, people from disaster-afflicted regions have formed a new stream of in-migration.
There is a steady migration of new residents from Spanish- and Portuguese-speaking countries south of the border.
Phoenix is a destination of choice or the second-landing city for immigrants from all over the world.
While higher oil prices will put a strain on our far-flung suburbs, the greatest pain will be felt in Northern states where fuel oil or natural gas are used as heat sources; even people who don’t hate the winter will move to the Phoenix area to escape high heating bills.
The Phoenix Metropolitan area is a dynamic jobs creation machine, adding tens of thousand of new jobs every year.
People who have or hope to have children move here as soon as they can manage it.
Compared to the areas from which many of our in-migrants are drawn, our homes are still very affordable.
We build thousands more new homes every year.
The Greater Phoenix area has 60 years of sustained practice at managing extreme growth — this in contrast to thrashing cities like Las Vegas.
Snowbirds, politely known as Our Winter Visitors, eventually move here year-around.
Our first waves of massive migration occurred after WW II; mustered out soldiers who had been stationed here came back with their families; this pattern continues among people who are posted here temporarily for various reasons.
People who stay at our resorts often fall in love with the Valley of the Sun and return as soon as they are able.
A significant number of active and retired professional athletes maintain homes here, in no small part because the Phoenix/Scottsdale area has…
Year-around golf.
don’t forget to add “houses here cost half of what they did only a few years ago!”
yes, and i am buying one in a week. i’m not a speculator and have never owned a house but saved and rented for years. anyhow, i can say i am looking forward to a house and not having a common wall with anyone! anyhow, the house i’m buying is at 82k in north phoenix, i get the 8k credit….and it is at prices last seen in 1995. it sold at 200k in 2006…so that is a huge fall. i have lived on and off in phoenix for 20 years and it has grown every year since then…and this bump in the ecnomy will not stop it. i do believe the migration patterns in the usa to sun belt states, baby boomer retirement, and the fact prices are still 1/2 to 1/3 california prices will in time cause prices to slowly rebound! that being said..this is not california and prices should never be 200k for the house i’m buying! i plan to live there a long time…and it is all cash so no bank to deal with!
We’re facing a $3.3 billion deficit in the $10 billion state budget. How to fix it?
The Republican governer’s plan is to take $1 billion from the Evil Obama stimulus, cut spending $1 billion, and raise taxes to generate $1 billion extra revenue.
The rest of the Republicans in the house and senate are looking to fix it without tax increases. Their proposal? Sweep up funds from counties and cities, force schools and other government agencies to spend every dollar in carry forward funds (end the fiscal year with absolutely $0 balance in every account), and just ignore about $700 million of the deficit by borrowing…..
And, actually, the $3 billion number is out of date. Receipts are falling faster than planned, so it is more like $3.3 billion….
I honestly beleive that PHX will soon be the next Detroit. There are just not enough jobs here for the number of houses.
On a more positive note…. As of December my company was bragging about how profits were still increasing and was interviewing with plans to add 10% staff.
Yesterday’s layoff was only 10% of our office.
I’m so glad the recession is over.
Wow I now can go out and buy a new suburban, a boat, and re-remodel the kitchen.
The good news: Unemployment is a lagging indicator.
The bad news: Nobody can say yet when this lagging indicator will bottom out.
I’d wager that in this recession unemployment may not be a lagging indicator simply because unemployment will drive additional foreclosures and value losses in the real estate market.
Today’s stock market rally completely defies reason…swine flu is spreading, California declares a public health emergency because of it, reports say GDP was down 6+% last quarter, and Wall St. says “let’s have a rally!”
Swine flu is MSM induced hysteria. I’m glad Wall St is ignoring the hype on this one.
Yeah…Only Detroit doesn’t need it’s God Given 40 days and nights allotment plus of rain, snow and sleet for H2O where as PHX could use a few of them.
Where would you rather retire, Detroit or Phoenix ? I’ve lived in Detroit and I’ve lived in PHX. I’ll take PHX any day.
Two questions:
Isn’t it cheaper to retire in Detroit than Phoenix on a fixed income?
Can’t you snowbird?
That would require two houses defeating the purpose of having a paid off house in retirement and reducing expenses to the bone.
An article a few months back in “Wired” magazine explained that people spend more money heating a place in cold climates than people who heat a place in warm climates. The temperature differential is usually higher in cold parts of the U.S.
Plus, retirees tend to have more intolerance for cold temps. They are thinner and love hot temperatures. I know an older thin guy who always had a space heater underneath his desk in Phoenix.
Costs more to heat in cold climate. Did “Wired” figure this out all by themselves? A “Shorted” reporter perhaps?
I think perhaps he meant costs more to heat in cold climates than cool in warm climates..ie you pay more in the winter in Boston than in the summer in Austin.
I’m thinking Texas Hill country north of SA. I’ve been to Detroit and Phoenix too.
In Michigan the grass is green, the trees are budding, and the birds are twittering - In Phoenix you are nearing your annual six months of hell on earth. The Detroit area is still a great place to live (notice I didn’t say Detroit), but we are woefully behind Phoenix in the number of loitering bands of illegal immigrants that populate our streets and parking lots. Maybe unemployed auto workers can take that job. I do wish we had some mountains on the horizon, though. That would be really cool.
And, unlike Arizona (aka “I’ll Do It Manana Land”), Michigan has a work ethic.
Uh, you’re forgetting that the high humidity and constant attack by mosquitos takes the fun out of summer in Michigan too.
Is there enough water in Phx for everyone?
I can’t comment on your company, but I have seen companies lay off to re-hire for the same positions right away. If there is a dead wood to get rid off, a 10% across the board layoff that is blamed on the ‘recession’ has less chance of bringing up lawsuits than letting go the dead wood individually.
“Guess What? Now It’s Tomorrow”
Here today, gone tomorrow. Or is now already The Day after Tomorrow?
“Greg Swann, a Phoenix real estate agent, took a moment to marvel at the news. ‘What happened here will some day be a new chapter in ‘‘Extraordinary Popular Delusions and the Madness of Crowds,’ the classic survey of investing mania, he said. ‘We were living during the boom like there was no tomorrow. And guess what? Now it’s tomorrow.’”
Best UHS comment, ever, bar none!
“In fact, there is no limit on the price of homes that qualify for the program. As a result, a handful of the 312 taxpayer-funded grants awarded in the first month have gone to help buy homes worth more than $500,000, with one home purchased for more than $700,000.”
“‘Is that the best use of public funds?’ asks Steve Graham, director of the Utah Community Reinvestment Coalition. ‘Obviously the Legislature and the governor felt it was. I focus on affordable housing, so certainly we would have loved to see that kind of funding go to low- and moderate-income homes.’”
“But, Graham said, the program was aimed at recharging the construction industry, not helping people afford a home. ‘That is a little difficult to swallow. I think people, their eyebrows should rise a little bit,’ said Graham of those unusual cases where the grant was given to high-priced homes.”
Affordable housing policy in a nut shell:
Create new FBs in order to recharge the construction industry. This is not sustainable and will end badly.
“A few weeks ago, I told you about Laura and her husband, who were hit hard when the local housing bubble burst. Laura wrote that her husband spent eight years as a real estate investor and was doing well. Then the economy turned sour, and they were stuck with eight houses they couldn’t sell. She was wondering whether there was any way they could avoid bankruptcy and foreclosure.”
Let me go way out on a limb here and venture a guess that Utah is going to have to drown in latent investor-owned inventory for a while before their housing market bottoms out.
“Then the economy turned sour”
Meaning their little house of cards collapsed and they were left holding the bag.
That’s what flippers mean when ‘they’ discuss “the economy”. Unemployment could be at 20%, Gold at $2,000, the DOW at 500 and gas $9 a gal. but as long as they’re making money playing musical houses… things couldn’t be better!
“Then the economy turned sour”
…as a result of morons buying houses they couldn’t afford with money they couldn’t pay back!
Yep, the “economy” was THEM!
I guess it’s hard to admit that when it destroys your business model.
“‘Is that the best use of public funds?’ asks Steve Graham, director of the Utah Community Reinvestment Coalition.”
ROTFLMAO!!!!
“Is that the best use of public funds?”
This phrase will be repeated 4,552,339,907,542,588 times in the next 8 years.
“Lenders this week stopped funding construction of the Fontainebleau Las Vegas, endangering the biggest real estate project in the Soffer family’s portfolio.”
The FB is about to become an FB
They just completed a mega-renovation of the Fontainebleau Hilton, which was not that well received. Seems they purchased the Hilton and tried to cash in on the name?
Egomaniacs. More and more and more and more. His rightful title could be Lil’ Trump:
“The family earned their fortune when Jeffrey’s father, Don, built Aventura out of swampland in the 1960s. The crown jewel of the family’s portfolio is the Aventura Mall, one of the country’s top shopping centers.”
Now the son is suing Fairmont over the marketing of the Fairmont Turnberry, that he developed. He thinks they should charge more money. ”It has two world-class golf courses and a tremendous location — a beach club, everything you’d want. They can’t turn a profit.” (It must be their fault if there is a glut of five star rooms).
From Miami Herald:
“Launched at the same time Jeffrey Soffer purchased the Fontainebleau Miami Beach, the Vegas property was slated to launch a global string of Fontainebleau casinos.”
“Last year, Soffer pumped $200 million cash into the Vegas project to cover cost overruns. The money came after he sold a 50 percent interest in Fontainebleau Miami Beach to an investment group run by the Dubai government.”
“In the press release, Soffer accuses the banks of reneging on a deal to fund the Vegas Fontainebleau through completion.
”We need them to live up to their promises so that we can complete a landmark project that will revitalize tourist visitation to Las Vegas,” Soffer said.
(I don’t know who will get the “visitation” here…a visitation by the angel of reality, perhaps.)
Recently stayed at the old F in Miami and the hotel is gorgeous and has every high end goodie imaginable. The downside is the service sucks across the board from waiting 45 mins @ 11 pm for a small desert order from room service to the valets losing our rental car.
That’s when developers run a hotel.
“‘We drank the Kool-Aid,’ said Jane Bryant Quinn, personal finance columnist for Bloomberg and Newsweek. ‘We believed that free markets were the best kind [of markets].’
Huh??? What free markets? The kind where Barney Frank & Chris Dodd coerced Fannie & Freddie and lenders into loaning to the $14/hr. hairdresser so she could buy 2 houses? Where lawsuits were filed alleging racism and forcing lenders to write loans in gang ridden neighborhoods?
The mainstream media has quickly lined up to join the growing drumbeat of Obama’s march to socialism. Free markets= bad mojo.
‘We believed that free markets were the best kind [of markets].’
Worst possible damage to come out of the MSM’s straw-man mischaracterization of the collapsing bubble: Attributing the effects of terrible top-down command-and-control housing policy to the free market.
Repeating the tired mantra that evil Jimmy Carter’s CRA caused the mortgage meltdown doesn’t make it any more true. Most of the worst loans were made by institutions not covered by CRA. Nobody “forced” banks to make these loans, they made them gleefully because THEY WERE MAKING MONEY HAND OVER FIST and securitizing them to get rid of the risk. Yes, government policy contributed to the meltdown, but if you want to blame someone, blame Uncle Greenspan’s free money.
I guess the GSEs and FHA don’t exist in your parallel universe?
The GSEs didn’t get into the really bad loans until well after the private market was eyeball-deep.
The GSEs were forced to expand their portfolios after the PTB saw what was going to happen to the private market, IMHO. In my personal opinion, they were forced to refi some of the really toxic loans in order to get the off of the private lenders’ books.
As in most wars, there is fault on both sides. Although in 2000 the Department of Housing and Urban Development (hud), under Andrew Cuomo, increased the requirements that Fannie and Freddie buy loans made to lower-income people, a dramatic increase came in 2004—under the Bush administration. Some people believe it did so merely in order to pressure the companies into agreeing to new regulation. But Fannie itself isn’t a hapless victim, either. In the end, it was Fannie executives who made a business decision to stake their future on risky mortgages that had nothing to do with helping people own homes. The company used its political power to stymie effective regulation, and its extreme aggressiveness and arrogance gave its enemies license to do things they never would have done to a normal company. And, oh, did they ever.
http://www.vanityfair.com/politics/features/2009/02/fannie-and-freddie200902
Yeah, what CA Renter said. The GSEs were very late to the game (they felt they were being crowded out of the market) and FHA didn’t get involved until NOW. They’re now backing 1/3 of the market, up from 3% in 2006. You’re welcome to make the argument that the next collapse will be due directly to political mismanagement because it will be true then. I just get tired of the Fox News spin on this crisis, because it’s just an attempt to forestall accountability on those really responsible.
BKlawyer,
Not contesting a ‘word’ of it, but in many cases, loans done be it in Compton or other “bars on windows” neighborhoods are again… a result of the Rolling Bubble.
This thing sure didn’t start in the roughest areas by any stretch ( that’s just where it surfaces at it’s most ridiculous ) “They paid HOW much for that dump?! In ‘that’ neighborhood?”
Somebody bought his silence but at the height of the boom there was this guy that called himself Mr.Overvaluedblogspot.com. Some of the pictures he posted w/ boarded windows and pitbulls in the yard were beyond precious. Again though, I believe in many cases these were instances of infestors from -outside- the area looking for a cheap/quick flip. In others, affinity fraud but in all, the only areas left to be exploited.
Okay, I am not going to be sucked into this one. Not going to do it!
“The Scottsdale, Arizona-based homebuilder is implementing a plan to build cheaper houses that can compete in foreclosure hotbeds such as Arizona and California by shrinking the square footage, stripping out some amenities and simplifying the architecture.”
Oh brother, what amenities could he be talking about ? Oversized bathtubs, twin sinks in the master bath ? Just about anything that goes into these homes is speced by the buyer who has the option of buying cheap fixtures or expensive ones. Simplified Architecture ? So you’ll have a greater percentage of cookie cutter homes that use the same plan with less elevations to choose from ? These guys already use the same paid for plans for every damn development, it’s not like it’s costing them.
Are they going to be made cheaper as well? Maybe they’ll use Chinese drywall, leftover materials from their last job, and undocumented/unlicensed construction workers and contractors.
That horse, of course, has already left the barn.
But I’m sure you knew that
“The Liberty agent, who requested anonymity, said police were called to Liberty’s office Friday on Durango Drive to ‘calm the situation down’ and escort Bell from the building. ‘There’s a lot of upset brokers,’ the agent said. ‘I’m carrying around a $3,600 check that’s no good. They took the money out of escrow and arbitrarily passed it out to other agents.’”
Let me get out my tiny violin…
MGIC reports $184.6 million loss
By Paul Gores of the Journal Sentinel
MGIC Investment Corp. said Wednesday it recorded a net loss of $184.6 million in the first quarter as delinquencies continued to rise amid a weakening economy, increased unemployment and lower home prices.
The Milwaukee-based insurer of mortgages had a loss of $1.49 per share. The 2009 first-quarter compares with a loss of $34.5 million, or 41 cents per share, in the same period a year earlier.
…”While we have not pursued raising capital from private sources, we have been in discussions with both the U.S. Treasury and the Office of the Commissioner of Insurance of Wisconsin to explore capital options,” Culver said. “We believe that one of these options will develop in a manner that, combined with any benefits achieved from the national loan modification and refinance effort, will allow MGIC to continue to write new insurance on an uninterrupted basis.”
http://www.jsonline.com/business/43976032.html
nothing a small several billion dollar bailout can’t fix. I see this as good news- things could be so much worse. Gag me with green shoots…
This maybe a double post…so BEAR with me
MGIC reports $184.6 million loss
By Paul Gores of the Journal Sentinel
Posted: Apr. 29, 2009 7:34 a.m.
MGIC Investment Corp. said Wednesday it recorded a net loss of $184.6 million in the first quarter as delinquencies continued to rise amid a weakening economy, increased unemployment and lower home prices.
The Milwaukee-based insurer of mortgages had a loss of $1.49 per share. The 2009 first-quarter compares with a loss of $34.5 million, or 41 cents per share, in the same period a year earlier.
The average loss estimate for MGIC by a panel of four stock analysts surveyed by Bloomberg News was $1.30 per share.
Curt S. Culver, the chairman and chief executive of MGIC, said in a statement that while the company believes it has more-than-adequate resources to pay all of its insurance claims, it is considering several options to obtain capital to continue writing new business.
http://www.jsonline.com/business/43976032.html
PBS Frontline May 12th The Madoff Affair
(They usually release a documentary online on the same day.)
thank-you.
You’re welcome.
Here’s a funny from today’s Tucson Citizen:
Green builder renovates first masonry home to be TEP efficient
And here’s Slim with the backstory:
I bicycle past this house at least once a week. It’s been on the market for at least a year, and the original list price was in the $900,000s. And, to make matters worse, there are rental houses directly to the east and south of it. I don’t know about you, but if I’m paying almost a mill for a house, I want to be miles away from the nearest rental, not next door to it.
Hi All
looooonnnnng time reader, part time poster here… got a scenario for the collective mind to ponder;
I have a friend putting together a proposal for a house in Marin County CA, that is a little unusual. The current owner bought in ‘06 for $1.4m in an all cash deal but subsequently took a bit of a pounding from Mr Madof and is looking to liquidate some assets. The house has been on the market for a number of weeks at $1.3m and is getting little or no attention.
Here’s the offer being put on the table; $675K now, and then another $200K in five years with compounded interest at 5% on that $200K… so likely total is in the $920K range.
What I like about it is that his job is secure, the house is fantastic and likely to be their house for the next 20 years (and, yes, I know about the “no job is secure”, “what if you have to move” responses, let’s assume that as a given.).
The deal builds in a good 35% drop from peak, and therefore a buffer against the further expected drop. I think it’s a good way to get into a house right now at a price likely to be reached in something like that 5 year time frame anyway.
The unusual thing about this deal, of course, is the lack of any lender to screw things up… although I believe there is a trust that will have final say.
Personally I’m going to stay a happy renter… I don’t have the means for this kind of thing, and even now Marin drops are not enough to shift my thinking (although I was happy to note last month there was not a single sale of a house at over $1m in San Rafael - and that hasn’t been the case in… years)
thoughts?
That reminds me of Wimpy - ” I will gladly pay you tomorrow for a hamburger today!”
have you seen the robot chicken skit where popeye takes wimpy up on his promise.
then popeye stops by on tuesday to collect.
very funny stuff.
A person who needs some liquid cash accepting half of the purchase price? What are CA’s taxes again, ie: what’s the approximate carrying cost of the property?
I don’t think i’d accept such an offer, but who knows.
I’d probably counter with $1mm now, and the $400k 5 years later if I was into messing with you, of course again depending on carrying costs.
Firstly, it’s “Madoff” and it sounds to me like he’s attempting to leverage that into some empathy here?
Why bring Bernie’s name into it at all? You don’t have to have been one of BM’s clients to have taken a stern f@cking in the stock market, o.k? Or is that the point? By attempting to align himself w/ the likes of the Harvard Endowment and… Steven Speilberg and Kyra & Kevin is he implying that this is the type of home/area ‘they’ would live in?
I’ve been cranky all day but I fail to see any distinction here? Tell him to call the CA Dept. of Revenue and see if he can enjoin the other plaintiffs in getting some tax $’s back on the income that never existed! If he’s for real, he’ll know that, and if he *doesn’t, his as full of it as Bernie.
Steer the friend to this blog. And continue to set a good example by being a happy renter
Looks to me like an 875k offer conditioned by the seller financing 200k. That is about 45% off the 1400k peak 06 price, probably about where the Merin County market is right now, but still not enough to avoid catching the knife.
“Even during the Depression, I don’t think prices fell this quickly”
Yeah, well, that was then, and this is now.
Back then, people communicated using crank telephones and short-wave. Took a lot longer for information to get around, when it got around.
Nowadays, we have this thing called the “Internet”…….I’m sure you’ve heard of it. Makes it a lot easier for the REAL STORY to get out, because control of info is no longer centralized. A half-savvy person can do their own research, and come to their own conclusions.
Sometimes this sucks, depending on your personal circumstances.
GSf,
I wonder. I don’t think most people are even rational when they buy a house, much less engaged in research. Did the internet keep a lot of otherwise inteligent people from buying a house they couldn’t afford?
Did the internet prevent you and me from getting married to Typhoid Mary? To be honest, we didn’t have internet then.
Manias have nothing to do with the availability of information.
“……getting married to Typoid Mary?”
The info was there, but I chose to ignore/disregard it. When you are a guy in your late teens/early 20s, most of the time the little head does too much thinking for the big one. That, and (in retrospect) the ridiculous idea that you can “change” someone.
Oh fer cryin’ out loud, GS, you would have to bring up that “change” someone thing. I tried that in my late twenties, and oh, did that not work.
But some good did come out of it, and that was that I became very careful about who I let into my life. To put it mildly, I’m not into fixing problem people anymore. My attitude is that if you’ve got personal problems, fix them yourself on your time. Not mine.
And I want someone who is already fixed, baggage put in storage, and previous relationships in working order (ex wives/husbands & kids). I tell my girls - you can’t have a relationship with someone’s potential.
“Nowadays, we have this thing called the “Internet”…….I’m sure you’ve heard of it. Makes it a lot easier for the REAL STORY to get out, because control of info is no longer centralized. A half-savvy person can do their own research, and come to their own conclusions.”
Unfortunately, it’s also much easier for a fake story to get out, too. Like the popular one that “all the Jews” who worked in the twin towers didn’t show up for work on 9/11. That was a very popular story in part of the middle-east and it was viral, internet-fuelled.
A false story can get around the world before it has time to be evaluated, and half-savvy people have been coming to dumb conclusions since before the internet showed up, and I don’t see that things have changed drastically
The wholesale decentralization of information isn’t everything it’s cracked up to be.
(Yes, I still love the internet.)
Guess What? Now It’s Tomorrow
“Now it’s dark”
“Phoenix has achieved the unwelcome distinction of becoming the first major American city where home prices have fallen in half since the market peaked in the middle of the decade, according to data released Tuesday.”
By contrast, San Diego prices are off by a mere 41 percent since the Case-Shiller/S&P 500 index peaked in November 2005 at a level 252 percent above its March 1996 trough in the wake of the last housing bust.
However, that does not mean that San Diego home owners are necessarily faring any better financially, as San Diego home values are generally higher than Phoenix’s. For instance, suppose a Phoenix home would have sold for $200,000 at the peak and only for $100,000 currently — a drop of 50 percent. A San Diego home that dropped in value by 41 percent but which was worth $244,000 at the peak would now be worth (100-41)/100*244,000 = $143,960, a loss of $100,040.
And BTW, it was virtually impossible to find single family homes for sale in San Diego at the price of $244,000 at the bubble peak, and it is still difficult, though the number of homes priced below $300,000 seems to be steadily increasing.
RE: The number of homes priced below $300,000 seems to be steadily increasing.
According to ziprealty dot com, there are currently 2007 single family homes currently on the San Diego MLS priced under $300,000, versus next to none as of 2005.
Further, there are 200 homes priced between $295,000 and $300,000 — quite a selection in a very narrow price range!
Dutch tulip auction, anyone? Investors, step right up
This is off ziprealty dot com’s San Diego MLS listings:
2137 ANDA LUCIA WY, Oceanside, CA 92056**
School District: OCEANSIDE UNIFIED
Beds: 4 Type: SFR Sq. Ft.: 1,995 Lot Size: N/A MLS #: 080047325
Baths: 2/1 Built: 1990 $/Sq.Ft.: $150 List Date: 07/03/08 On Market: 300 days
Description
Beautiful home in desirable rancho del oro! Quiet location, large lot at end of cul-de-sac, backs up to trails! Offering an open floor plan, vaulted ceilings in living room, neutral decor w/ accent walls, plantation shutters, master bedroom on entry level , spanish-style tile flooring, clean light & bright kitchen, room for rv parking, close to parks and schools, a must see!
Price Reduced: 07/05/08 — $549,900 to $520,000
Price Reduced: 07/07/08 — $520,000 to $499,000
Price Reduced: 07/12/08 — $499,000 to $449,000
Price Reduced: 07/15/08 — $449,000 to $390,000
Price Reduced: 07/19/08 — $390,000 to $319,000
Price Reduced: 10/21/08 — $360,000 to $319,000
Price Increased: 11/04/08 — $319,000 to $355,000
Price Reduced: 01/09/09 — $355,000 to $299,000
“Price Reduced: 10/21/08 — $360,000 to $319,000
Price Increased: 11/04/08 — $319,000 to $355,000″
I always get a kick out of these. What are these people thinking?
‘It wouldn’t sell last week after we reduced the price by $41,000, so maybe if we increase it by $36,000 it will sell this week, especially now that Obama is in the White House.’
“Price Reduced: 01/09/09 — $355,000 to $299,000″
Hint from Mr Market to befuddled seller: If it wouldn’t sell after four months at a list price of $299,000, the current market value of your home must be somewhat below $299,000.
That was probably the point where they hired the new realtor who promised them a higher price.
Talk about chasing the market down.
If they did their eventual price reduction six months earlier, this house would have sold. But even at $299 it won’t sell now, even though it would have a few months ago. Maybe at $230 it would. But I imagine this seller will wait until 2010 to ask $230, at which point they will only be able to get $170.
Right, and some of those P/R’s could have been measured in ‘hours’ almost as readily as days. Freakin’ comical. Reminds me, got to stop by FlippersInTrouble.com once in awhile.
I am -absolutely- not going to challenge there were few if any SFH’s in San Diego’s inventory in ‘05. I’ll… take you at your word.
“…not going to challenge there were few if any SFH’s in San Diego’s inventory in ‘05.”
There were plenty of SFH’s in 2005 San Diego inventory at $500K and above.
PB,
Right, back when money was no object. Talk to a realtor about sub $300k listings then and it was just assumed… you were talking about a townhouse etc?
I’ve never said “anybody should be able to ‘afford’ to live anywhere they want, even La Jolla if they so chose!”
That’s why parts of town are known as e-x-c-l-u-s-i-v-e, but there was no good reason that -any- home ( north of the border and west of Jamul ? ) to be instantly priced 10 X median income.
Talk about chasing the market down.
“I’m not going to GIVE it away”
“The Bubblefather”…….Episode 5
Mozilo: Don Paulsone, I need a man who has powerful friends…..I need a trillion dollars in cash. I need Don Paulsone and all those politicians and regulators from the Treasury and SEC that you carry around in your pocket like so many nickels and dimes.
Don P: What is the interest for my family?
Mozilo: Thirty percent a year, guaranteed. Because, you know, the price of Real Estate never goes down.
Don P: Why come to me? What have I done to deserve such generosity?
Mozilo:If you consider a trillion dollars mere finance…te salud, Don Paulsone.
Don P: I said that I would see you, because I have heard that you are a serious man…..that, and I wanted to see your orange suntan for myself, because I felt it would amuse me. But I must say no to you, and I will give you my reasons….
True, I have a lot of friends in politics. But they would not be so friendly if they knew my business was subprime mortgages, instead of cocaine, heroin, and methanphetamines, which they consider a harmless vice. But subprime mortgages, that’s a dirty business….
Mozilo: If you are worried about security for your trillion dollars, Merrill Lynch will guarantee it……..something called a CDS. It’s the latest thing in finance.
Sonny Geitner: Now your telling me that Merrill Lynch is going to guarantee our investment……….
Don P: I have a sentimental weakness for my children and they are spoiled as you can see. They talk when they should shut up and do what I say. But Signor Mozilo, my no to you is final, but I wish you good luck, as long as your interests don’t conflict with mine.
(Mozilo leaves)
(Don P slaps Sonny G in the back of the head)
Don P: What’s the matter with you?? Your brain’s going soft; you never tell anyone outside the Wall Street family what you really think again ……..
and later…….
Sonny G: Hey listen, I want someone good…….and I mean very good…..to plant this TARP scheme. I don’t want our Wall Street friends to come away from the FED with nothing but their d##ks in their hands………
LMAO!
GO REPUBS!!!
Wall Street Journal
* APRIL 30, 2009
‘Cramdown’ Lacks Votes
By ELIZABETH WILLIAMSON
WASHINGTON — President Barack Obama’s proposal to give homeowners new relief in bankruptcy court appears headed to defeat in the Senate Thursday, barring a last-minute compromise.
As of late Wednesday, a measure allowing judges to reduce the mortgages of homeowners in bankruptcy court, known as “cramdown,” didn’t have the 60 votes needed to pass a procedural vote in the Senate, where Republicans still have the numbers needed to block legislation. The measure lacks the support of some Democrats as well, amid opposition by community banks and credit unions.
Woo-hoo!!!!
Financial Times
Rising bond yields present fresh Fed challenge
By Aline van Duyn in New York
Published: April 29 2009 18:15 | Last updated: April 29 2009 18:15
After rising steadily in recent weeks, yields on US Treasuries have this week finally climbed back above the levels at which they were trading before the Federal Reserve started buying US debt a month ago.
The ability of the Fed to balance the records amounts of new debt the US government has to sell – supply pressure which tends to raise interest rates – with its desire to keep interest rates low enough to spur fresh lending and mortgage financing continues to drive the Treasury market.
Yields on 10-year US Treasury debt on Wednesday traded above 3.00 per cent, compared with a low of 2.54 per cent on March 18 just after the Fed had announced it was planning to buy long-term debt. The 30-year US Treasury bond yield hit 3.92 per cent, above the 3.8 per cent before “quantitative easing” was introduced.
“It’s all about the market’s testing of the Fed’s resolve to keep yields low,” said Carl Lantz, interest rate strategist at Credit Suisse. “The markets are waiting to see whether the Fed will keep surprising them in ways that could push yields lower.” Such surprises could involve a bigger direct purchases, or buying larger chunks of debt at once, he said.
Could surprise bigger direct purchases trigger surprise currency devaluations? Or would the exchange rate impact be effectively sterilized?
“The same answer applies: greed, pure unadulterated greed,’ she wrote.””
– I turn right off when I see people complaining about “greed”. Greed is when the other guy wants to make a profit. Stupidly asking too much? Sure, but wanting money - aka greed? Since when is wanting to make money bad?
Rental Classified from Park City: “Just Reduced $3500 to $2300!”
For an outlying condo, asking price had been up to 1400 - my friend always rented it out for 1200 - today advertised for 1000.
Also, re the property management company Deer Valley Lodging who have not paid their owners: it is interesting to note that six owners have filed against DVL. They say they should have been paid 5000 each on average (that should be for two months). That is very little, considering the expensive properties that were under DVL management. You have a 600K + condo, and the rental income is only 2.5K a month? During a season that was supposedly only 30% less busy than last year?
Who moved my green shoots?
latest news
Bank of Japan cuts ‘09 GDP forecast
Chrysler talks collapse, bankruptcy imminent: WSJ
By Michael Kitchen
Last update: 12:20 a.m. EDT April 30, 2009
LOS ANGELES (MarketWatch) — Talks between the Treasury Department and lenders aimed at keeping Chrysler LLC out of bankruptcy broke down Wednesday, making it all but certain the car maker will file for Chapter 11 protection Thursday, The Wall Street Journal reported late Wednesday, citing people familiar with the discussions.