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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Things renters don’t do on the weekend:
1) shovel snow (that’s the landlord’s job, silly)
2) clear tree branches from early season snowstorm
3) write checks for gas, water, sewer, trash bills
Why does the landlord need to shovel snow? As long as the snow is not in his way why should it be his concern?
Here in Boston it’s the Law. If the area in front of the property is not cleared within 24 hours the owner is subject to fines.
A strong incentive not to rent to deadbeats too lazy to keep their walkways and driveways clean.
Lazy deadbeat renter here, write one check a month and spend zero time and money (other than replacing lightbulbs) on maintenance. Renters rule, loan-owners drool
A strong incentive not to rent to deadbeats too lazy to keep their walkways and driveways clean.
Tell me about it!
I spent this morning’s just got-outta-bed time on sweeping the sidewalk along the property to the east of mine. I don’t know where the tenant has gone — I haven’t seen him since the late summer. But his stuff’s still there.
Any-hoo, there was all sorts of dirt and sand that had washed down onto the sidewalk during the monsoon storms. They’ve been gone for several weeks, but the mess remained. It was the sort of mess that could cause someone to slip and fall, and guess who would have heard the screaming and hollering from the injured person? Me, that’s who.
So, I made like Allegra Bennett in the book Renovating Woman. She got tired of looking at the messy vacant lot next door. Over to that lot went Allegra and her lawn mower and she took care of the mess.
Back to Slim’s story: The washout is going into a low spot in the property next door. That low spot floods when it rains, and if there’s one thing I don’t want, it’s a flood over here. I’ve almost got it filled. Next week’s project will be to sweep the washout that’s accumulated on the street below the sidewalk, then dump it into the aforementioned low spot.
Truth be told, I’m having a great time. The neighborhood looks a lot better, and I’m hatching schemes for additional planting in the guerrilla garden I’ve created below the low spot.
With regards from your Stealth Neighborhood Cleanup service…
Slim is a deadbeat landlord’s dream neighbor!
Okay, a real dumbass question coming from a guy that lives where it doesn’t snow: What do you do with the all the snow you shovel?
Assuming it doesn’t melt right away, where can you put it so it won’t be a bother? Where does the snow that is cleared or blown or whatever from the streets go when the streets are cleared? Does it end up in your yard? If you blow snow from your yard wouldn’t it end up in the street?
Is this snow really “cleared” or is it just moved around from one place to another?
Not sure if it’s different in places where it doesn’t melt until spring, but everywhere I’ve lived the lawn is a lot bigger than the sidewalk, and you just scoop it or blow it onto the lawn. Then it melts within a few days and waters the grass. The only thing that sucks is when you clear off the sidewalk next to the street and then snowplows come along and clear the street back onto your sidewalk. It tends to be fluffy when it first falls, but turn to concrete when it gets moved and warmed a bit and then refreezes.
“What do you do with the all the snow you shovel?”
You pile it up along the edges of your side walk. Then when it snows again and you have a bit of wind, the snow drifts on to your side walk twice as deep as it was before. Repeat all winter.
Why not get one of those leaf blowers the Mexican yard care specialists favor and use it to blow around the snow?
That would only work when it’s *really* fluffy. Which is kinda rare.
“That would only work…”
For that matter, I don’t really get the leaf blowing concept. Back when I was a homeowner, I discovered that a rake and a large trash can work really well. Why you would want to first blow the leaves before raking them has long been a mystery to me.
Those things only apply if you rent in multifamily housing. Which means you have given up some of your privacy. It’s a trade off. Lot’s of other restrictions like having pets, nice veggie garden, putting up a solar array to make money…
Multifamily housing = noise, parties, problems. Multi-single housing is the way to go, i.e. live in a building with only efficiency and 1BR units. That way too small for roommates or kids = no noise, parties, problems. WRT privacy, the squad occupies top-floor unit that due to architectural oddity has no shared neighbor walls. Renters rule, loan-owners drool
In a lot of places, multi-single housing = students = noise. Those kids manage to have parties in the smallest spaces.
I actually think there are a fair number of students in my building - largely female law students from American University which is two metro stops away. Probably kids whose parents think that living in DC = dangerous. They are pretty quiet, except perhaps twice a year (end of semester).
Don’t forget the inevitable drunk kid who falls off a balcony.
As I’ve posted before we do all of that while paying $500 a month more than our last pit (no i) for our rent for a place not even near close to how nice our house was. The house was however in another school district.
Does anyone think maybe we should have bought back when the prices were first low? I still say there’s another drop coming so I’m ok w/not purchasing but as this drags out I like pointing out there is not one “one size fits all” answer across the nation.
I rent. I also shovel my own snow (driveway and sidewalk) and keep up my own yard.
Depends on the rental. I rent a townhome, and I pay for gas, water, sewer, and trash. I’m not writing separate checks because the $$ are just added to the rent bill, but I do pony up. They do snowblow the sidewalks, but plowing the parking lot consists of one swipe. You have to dig out your car anyway.
And this is not limited to house rentals. When I was looking for an apartment in the Midwest, one of the newer complexes of garden apartments charged for water and sewer. You also had to arrange to rent your own washer-dryer (they only had hook-ups) and pay dues to their “club,” which was basically extra fees for the pool and wine-tastings.
At least where I’ve lived, you pay for all these services, one way or another.
The MoCo standard rental agreement for a single family house makes the renter responsible for snow removal. My guess is the fine goes to the owner but the rules (assuming they didn’t change the terms of the standard lease) allow him/her to then require the renter to pay it.
Obviously different with multi-family. Not sure how a townhouse would fit in that scheme.
Three things homeowners* don’t do on the weekend:
1.) Worry about the LL deciding to move their mother-in-law into one’s at-last comfy nest.
2.) Regret that they can’t spend it in the garden under their laden fruit trees playing fetch with their big, goofy dog(s.)
3.) Wonder what it must be like to feel a sense of rootedness after all those decades of two-year leases and forced relocations.
*Home OWNers, that is.
“3.) Wonder what it must be like to feel a sense of rootedness after all those decades of two-year leases and forced relocations.”
“*Home OWNers, that is.”
+ like a lot
I really miss working on my own place. It was too small but it was a really good feeling when I did a home improvement that made my wife or kids happy. sigh
PS
I also have a big, goofy dog. He hasn`t had a fenced yard to play fetch since Oct. 2005 when we sold and started this long, strange trip to rental land.
I pay water, sewer, storm drain, special flood BS, trash, etc.
3) write checks for gas, water, sewer, trash bills
I’m renting a house, and I write checks (well, electronic payments) for all of these except sewer. Gardener is included in the rent, though.
Snow?, it was 89 today and I was at the beach.
http://www.bloomberg.com/apps/quote?ticker=GBTPGR2:IND
Italian bonds spiking one day after EU voted to throw more good money after bad. So much for “crisis contained.” For a trillion Euros you’d think these soon-to-be-insolvent Eurozone states would get a slightly longer afterglow.
Any bets on when Benny & the Inkjets step in with QE 3?
“Benny & the Inkjets” LOL.
Time for our resident lyricist to weigh in, no?
Can inkjets move faster than helicopters?
It’s going to be really tough for them to stay ahead of the Euros in the race to the bottom. I expect more trying, but I don’t undersatnd the motivation. A stronger dollar would make things better in the US for everyone but the debt hampsters. Why is it always all about the spoiled misbehaved child?
http://www.bloomberg.com/apps/quote?ticker=GSPG10YR:IND
Spanish ten year bond off to the races. B…b…but I thought since Greece was “rescued” it was all boom times ahead for the EU and global markets.
How about coming up with a housing bubble “Hall of Fame” and “Hall of Shame,” to be permanently linked on the site.
The first, led by Ben Jones, would be people who either correctly described or accurately reported aspects of the housing bubble before it became common knowledge. Folks like Toscano, Baker, etc.
The second would include people who were either deluded about what was happening, deceived others, profited from it, or all three. Tough call as to Liereah, Mozillo or Greenspan for first.
There could be a few weekends of nominations, and then decisions on the order of fame or shame.
Hall of Fame nominations:
1. Economist Dean Baker, who’s been hollering “housing bubble” for about as long as we have.
2. NYU’s Noriel Roubini. Another economist who didn’t go along with the housing boom herd.
3. Robert Shiller of “Irrational Exuberance” fame.
John R. Talbott, who wrote The Coming Crash in the Housing Market in mid-2003, Sell Now in early 2006, and,
, How I predicted the Global Econmic Crisis.
As early as 2003, his whole schtick was about leveredged buyouts and CDS, which made no sense to me in 2006-2007, but it’s relevant now. And he told us to sell in 2006. But I could do without the last braggy book.
4. Chris Thornberg
Looks like the DOW is just coasting this morning after its sugar high on Europe.
I miss the days when a company’s stock price traded in its own earnings, performance and fundamentals versus forward-looking global warm and fuzzies.
How many years from now until when the housing market bottoms out?
A good friend, retired bond broker, see’s a spike in home prices around 2013, and then a long slide down for the
next twenty years. His comment: To much debt for this
to ever go away…..
Spike in housing prices in 2013? LMAO.
“…see’s a spike in home prices around 2013…”
Does he have any rationale to back this up, or is this some variant of ‘real estate always goes up’?
My bet is when everyone over the age of 18 today has been dead for a few years.
Does anyone want to talk about the issue I brought up about what would have really happened if the banks hadn’t been “rescued” in the manner they were all those years ago? I think it was Tuesday.
My basic idea is what would have happened if, instead of giving Hank Paulson a completely blank check to save the banks, Congress had given him authority to split them up, sell off the depositor and solvent commercial lending bits, and then made the shareholders and unsecured bond holders and CDS counterparties and all the other speculators take their lumps to the extent necessary to wind it all down.
I think there was more than enough money sloshing around the system in hedge funds and private equity funds to take over the basic banking functions, though I don’t know if they would have wanted those businesses. Smaller banks could have taken the accounts relevant to their areas. It would have taken some time. They would have been nationalized for at least a few months.
“If banks hadn’t been ‘rescued’….”
We’d be dealing with a nascent civil war.
A whole lot of government and private paychecks would be irredeemable, goods and services un-purchased or unpurchasable, and credit cards and retirement funds rendered useless. If no one accepts the coin of the realm, and no one is willing to grant credit, things could get pretty messy pretty quickly.
I suspect unemployment would be ahem, significantly higher than the 20% it is now. A whole lot of chronically ill poor folks and oldsters would be dead or in end-stage decline. Global exports (our food sources among them,) would dwindle, as would our supply chains. OWS would be armed. Tax revenues would be not only withheld, but uncollectible. De facto war lords, er volunteer peace officers would enforce the local order. Ta-taa to the court, contract, and title system. And what about that pesky unpaid military?
But Craig’s list and eBay would be thriving. And lawyers would be having a field day….
You forget me, stabbing everybody for rice.
Remember that, the rice bubble?
A replay of the Great Depression, with rolling large scale bankruptcies and an eventual bank holiday or nationalization.
The question is, whether that is better or worse in the long run than what we are facing now.
I wonder if we could have some input on current foreclosure timelines. Are they getting longer?
The global financial system clearly is FUBAR, which raises interesting questions:
1) Is this a new development, or the way it has always been?
2) Will the way forward produce radical improvement, or a muddling through which ultimately leads to more of the same for our adult children?
3) What can the Common Man do to improve the situation?
Does Merkel’s leadership in shifting Greek debt losses from households to banks herald the beginning of the end for “too-big-to-fail”? And will U.S. policymakers ultimately find themselves forced to follow her lead?
Merkel Asserts EU Crisis Leadership as She Seeks to Win Back German Voters
By Leon Mangasarian and Patrick Donahue - Oct 28, 2011 1:23 AM PT
Germany’s chancellor Angela Merkel. Photographer: Jock Fistick/Bloomberg
Chancellor Angela Merkel emerged from 10 hours of negotiations in Brussels with a plan to stem the debt crisis that might as well have been written in Berlin.
The German leader forced French President Nicolas Sarkozy to bend to her will on using the European rescue fund only as a last resort, ruled out an automatic crisis-fighting role for the European Central Bank and dragged banks back to the table to take greater losses on Greek debt. She even wrung further budget concessions out of Italian Prime Minister Silvio Berlusconi.
“Merkel got what she wanted,” Shada Islam, an analyst at the Friends of Europe policy-advisory group in Brussels, said by phone yesterday after the summit ended. “This has confirmed Germany’s role as the make-or-break player not only in the euro- zone crisis but in European Union affairs beyond Europe.”
…
Does Merkel’s leadership in shifting Greek debt losses from households to banks herald the beginning of the end for “too-big-to-fail”? And will U.S. policymakers ultimately find themselves forced to follow her lead?
I sure hope so!
My understanding is that instead of bailout out the country so the banks would not take losses, they’ll end up bailing out the banks. No change yet.
Comment by Ben Jones
2011-10-27 13:40:12
Don’t get me wrong, I used to fight against this stuff. When some of us voiced concerns about the police state/surveillance state years ago, we got called a lot of names and were dismissed as paranoid. Now it’s ingrained in our society and someone butts heads with the PTB and look what they’re up against!
This isn’t the same country it was 20 years ago, so I keep a low profile and go out of my way not to give the system a reason to mess with me. It’s not what I’d prefer in a society, but I didn’t make these laws.
Weekend topic suggestion: what you do you (I know many of us do _something_) to keep a “low profile” and avoid giving the system a reason to mess with you?
There is no way there isn’t a database that sorts people by threat and whatnot. Minority Report, Person of Interest, The Matrix, etc.
That’s what really pisses me off. The good news is that the internet appears to be a democratizing force… for now.
Is there any possibility the next president (possibly the current one) will hire an enlightened team of economics advisers who can connect the dots between the moribund housing market and artificially-inflated prices? Anyone who passed an undergraduate economics course or wrote an undergraduate economics text book should be able to figure this out.
Census: Share of Americans on the move falls to record low amid long-term housing and job woes
By Associated Press, Published: October 26
WASHINGTON — Yet another symptom of the economic downturn: Americans aren’t moving.
Young adults are staying put, often with their parents. Older people aren’t able to retire to beachfront or lakeside homes.
U.S. mobility is at its lowest point since World War II.
New information from the Census Bureau highlights the continuing impact of the housing bust and unemployment on U.S. migration, after earlier signs that mobility was back on the upswing. It’s a shift from America’s long-standing cultural image of ever-changing frontiers, dating to the westward migration of the 1800s and more recently in the spreading out of whites, blacks and Hispanics in the Sun Belt’s housing boom.
Rather than housing magnets such as Arizona, Florida and Nevada, it is now more traditional, densely populated states — California, Illinois, Massachusetts, New York and New Jersey — that are showing some of the biggest population gains in the recent economic slump, according to the data released Thursday.
Residents have been largely locked in place. Families are stuck in devalued homes and young adults are living with parents or staying put in the towns where they went to college.
…
Dammit!
Need.blog.during.day.
I need a longer day or something.