High-Priced Condos And Bigger Homes
The Times Union reports on New York. “A report state Comptroller Thomas DiNapoli released this week was a reminder that New Yorkers’ incomes haven’t kept up with the cost of living here. Based on the federal guideline that ‘affordable housing’ means you’re not spending more than 30 percent of your household income on rent or a mortgage payment, 3 million families in New York can’t afford the roof over their head. Alex Monticello, the owner of Monticello Realty and a licensed real estate broker, said the problem isn’t housing prices.”
“A look at the median sale price of a home in the Capital Region between 2007 and 2013 doesn’t show runaway prices. In 2007, when the market was booming, it was $199,000. In 2013: $202,100. The problem is incomes, he said. For homeowners, median income between 2000 and 2012 declined by 1.6 percent — or $963 — while housing costs jumped by nearly 10 percent, pushed upward by a 12.3 percent increase in median property taxes, DiNapoli’s report found.”
“‘Part of the solution to addressing the affordability of housing across New York is to raise the minimum wage and provide universal pre-kindergarten, which will address the larger macro economic issues,’ Monticello said.”
The Boston Herald in Massachusetts. “A scarcity of residential property for sale in Boston has led to a smouldering real estate market marked by standing-room-only open houses, bidding wars and all-cash purchases. Open houses at many properties resemble opening day at a blockbuster movie, with lines stretched down the block. ‘No longer is one person on our end enough to handle it,’ said Ryan Persac of Otis and Ahearn Real Estate. ‘We have to get assistance from other agents to be door people and elevator people.’”
Kimberly Grose said she would have been thrilled to get $500,000 for her 737-square-foot, one-bedroom South End condo, which she bought for $150,000 in 1995. But Garofalo listed it last month at $550,000, then raised the price to $559,0000 in time for the open house, which was attended by about 35 people. Three days later, he opened it up for bids, and received about a half-dozen offers, including one that was all cash and another that was two-thirds cash from a woman who wrote Grose a letter, professing her love for the property. ‘I took the all cash one,’ she said, for $600,000.”
The Tewksbury Advocate in Massachusetts. “A Brookings Institution study released in May 2013 that said poverty in the suburbs is rising rapidly. Across the region, inside buttoned-up homes with manicured lawns, people are struggling to pay bills and keep food on the table. ‘Since 2000 we saw the poor population in suburbs grow by 65 percent,’ said co-author Elizabeth Kneebone. That means the number of residents living below the federal poverty line grew by 65 percent from 2000 to 2012. ‘That’s more than twice the pace of growth as occurred in central cities,’ she said.”
“Among communities northwest of Boston, Billerica, Burlington, Lincoln and Winchester were among those that saw significant increases in poverty rates since 2000. ‘There’s a disturbing number of people who have been on unemployment for some time and have run out of unemployment [benefits] and have not been able to find another job,’ said Westford Social Worker Alison Christopher. People in this category are not eligible for transitional assistance and don’t typically qualify for disability, she said. Yet, they have mortgages to pay and some are facing foreclosure, Christopher added.”
The Press of Atlantic City in New Jersey. “A luxury condominium in Atlantic City, Bella, is offering a free Smart car, a free smart (or hybrid) TV and a free smartphone with the purchase (a signed contract) of a two-bed, two-bath condo before April 30. The price of those condos starts at $249,000 - the lowest they have ever been, according to marketing director Paula Celletti-Baron.”
“When Scannapieco Development Corp. remodeled the 1980s building in 2005, it was selling the two-bed, two-bath condos for about $450,000 - but that was before the housing market crash, Celletti-Baron said. At that time, some people either stopped looking for second homes or sold the ones they had. There are currently about 50 units - most of which are still brand new - available at Bella. The option for the freebies is valued at about $30,000, which buyers can choose as cash toward their purchase instead, Celletti-Baron said.”
“Four Seasons at Harbor Bay, by Red Bank-based K. Hovnanian Enterprises Inc., is offering a discounted price on spec, or pre-built, homes for ‘quick move-ins’ by the end of March. The discounts vary in price, ranging between $40,000 and $50,000. One spec home listed on the website, is priced at $299,950 - discounted from about $306,000.”
“Another development - the Village Grande at English Mill, in Egg Harbor Township - is throwing in a premium kitchen package to attract buyers. D.R. Horton has put together a package that includes a kitchen island counter, 42-inch cabinets, granite countertops, hardwood flooring and a stainless steel gas range, dishwasher and microwave. ‘For shore properties, there is a small amount of time that is the busy season - as soon as the Super Bowl ends and not a minute after Memorial Day,’ said Laura Krebs, public relations representative at Cashman & Associates.”
Seacoast Online on New Hampshire. “The Blue Ribbon Senior Committee report states the number of people between the ages of 25 to 44 living in the city has dropped from 7,520 in 2000 to a projected 6,513 in 2014, a 13.5 percent decrease. At the same time, the number of city residents age 5 to 17 is projected to drop to 2,287 this year from 2,556 in 2000, a 10.5 percent decrease, according to the report. ‘It’s frightening because economically the 25 to 45 age group are the people usually contributing the most to the city,’ said City Councilor Eric Spear. ‘They’re spending the most money, they’re earning the most money and they’re spending it in the local economy.’”
“Spear blames the lack of affordable housing in the city as the main reason the population numbers are dropping for children and people age 25 to 44. Assistant Mayor Jim Splaine called the drop in the two populations ‘a very disturbing trend, not only for Portsmouth but the entire Seacoast and the state.’ He believes city officials should encourage developers to build ‘work force housing that doesn’t take up a lot of space,’ while pointing to what he feels has been an emphasis by developers on building ‘high-priced condos.’ ‘There seems to be this rush to build bigger and bigger homes,’ Splaine said.”
The York Dispatch in Pennsylvania. “Despite other indicators that the local economy is improving, foreclosure filings and sheriff’s sales remain high in York County. Prothonotary Pam Lee’s York County office processed 1,823 foreclosures in 2013 — a 4.7 percent jump from the 1,740 filings in 2012. And the filings in 2012 were a 40 percent increase from the 1,239 filings in 2011. This year is off to a similar start.”
“Though the unemployment rate has slowly dropped to 6.6 percent, it’s still a long way off from the 4 percent rate York County had before the recession. Also, the jobs that have been added are mostly in the service industry and don’t pay a high wage. ‘With the number (of foreclosures) staying high, it makes me wonder if people don’t have enough income because they can’t afford to stay in their houses,’ Lee said.”
<b“A look at the median sale price of a home in the Capital Region between 2007 and 2013 doesn’t show runaway prices.”
But they tripled from 1998-2006 and are still elevated 250% higher than long term trend.
Cherry picking fool.
Cherry picking indeed, but that is how mania thinks.
“Part of the solution to addressing the affordability of housing across New York is to raise the minimum wage and provide universal pre-kindergarten…”
Minimum wage will not support a $200,000 house purchase on credit. Squeeze a couple more working years out of young mothers to support the housing market?
Alexandria, VA(DC metro) Housing Prices Crater 16%; Inventory Skyrockets 40%
http://www.movoto.com/alexandria-va/market-trends/
median house size down 27% (1401, vs. 1908 a year ago)
price per square foot down 1% (289 vs. 291 a year ago)
So people can only afford smaller houses, not good if your selling a big one.
A new smaller house as a opposed to a run down 30 year old house.
The difference is depreciation. Houses depreciate.
A most interesting slew of articles. Housing demand has collapsed in every one of the areas mentioned.
unemployment rate = how much gov pays you not to work
see sing ,no unemp scheme w a rate of 1.8%
“…while housing costs jumped by nearly 10 percent, pushed upward by a 12.3 percent increase in median property taxes, DiNapoli’s report found.”
God bless our landlords for shouldering ever-higher property taxes!
“‘Part of the solution to addressing the affordability of housing across New York is to raise the minimum wage and provide universal pre-kindergarten, which will address the larger macro economic issues,’ Monticello said.”
Right. With universal pre-kindergarten and a higher minimum wage, more debt slaves who can never hope to be able to pay off a mortgage on a New York-priced home can enjoy the opportunity to die trying.
It’s a thing of beauty.
“‘Part of the solution to addressing the affordability of housing across New York is to raise the minimum wage and provide universal pre-kindergarten, which will address the larger macro economic issues,’ Monticello said.”
The economic ignorance of this statement particularly the minimum wage part is mind boggling. A person making minimum wage even if they raise it to Obama’s wish level cannot afford a $200,000.00 house. However, the increased costs for services caused by the increase will impact the ability of other people to afford buying a house. The providing of universal pre-kindergarten will raise taxes for existing homeowners and cause landlords to raise rents. Any benefits from such a program are probably eighteen years away and that is assuming there will be any jobs available for someone with just a high school education.
Economic ignorance = My profit center
Idiocracy= the bank’s promise land.
If they are schooled properly I will end up owning their souls.
You school them, I’ll rule them.
Second to the concept of bitcoins, what really brings me a laugh is the statement “People are smart”
“The economic ignorance of this statement particularly the minimum wage part is mind boggling.”
+1 You missed the disclaimer, New York.
“A scarcity of residential property for sale in Boston has led to a smouldering real estate market marked by standing-room-only open houses, bidding wars and all-cash purchases. Open houses at many properties resemble opening day at a blockbuster movie, with lines stretched down the block. ‘No longer is one person on our end enough to handle it,’ said Ryan Persac of Otis and Ahearn Real Estate. ‘We have to get assistance from other agents to be door people and elevator people.’”
Full blown mania noted in Beantown…
Full blown mania noted in Beantown…
You know what happens when you consume too much beans. The bubble is going to stink up the place.
Full blown mania noted in Beantown…
Indeed. The Mass economy is really the Boston economy. The job market is strong for STEM workers with average compensation increasing across the board. Lots of startups and venture funds throwing money around. Big name tech companies opening offices here. Demand for top-tier colleges and universities continues to be strong. All of which is driving housing demand within the city and 128.
Get outside of 128 and everything changes. Lots of poverty and government assistance in the old mill cities. Many struggling middle-class families in the suburbs trying to make ends meet. FWIW, those that bought in high-end communities or areas like Cambridge or South Boston have made out like bandits this last decade. Everyone else, not so much. I fear that Boston has become like London… too expensive by far, but with too much money chasing too few properties to actually drop significantly.
I fear that Boston has become like London… too expensive by far, but with too much money chasing too few properties to actually drop significantly.’
not just Boston
Until it melts down.
“A luxury condominium in Atlantic City, Bella, is offering a free Smart car, a free smart (or hybrid) TV and a free smartphone with the purchase (a signed contract) of a two-bed, two-bath condo before April 30. The price of those condos starts at $249,000 - the lowest they have ever been, according to marketing director Paula Celletti-Baron.”
Let me guess: The $30,000 in ‘freebies’ somehow qualifies financing as part of the principle on a federally-guaranteed mortgage?
“When Scannapieco Development Corp. remodeled the 1980s building in 2005, it was selling the two-bed, two-bath condos for about $450,000 - but that was before the housing market crash, Celletti-Baron said. At that time, some people either stopped looking for second homes or sold the ones they had. There are currently about 50 units - most of which are still brand new - available at Bella. The option for the freebies is valued at about $30,000, which buyers can choose as cash toward their purchase instead, Celletti-Baron said.”
$450,000 down to $249,000 sounds like quite the underwater haircut for the 2005 vintage buyers. That said, $249,000 still sounds like a pretty penny to pony up for a rehabbed 1980-construction apartment.
you could live there and meet strangers that get off the $15 bus to go for broke =kewl
http://blog.timesunion.com/realestate/study-schenectady-taxes-the-regions-highest/8213/
I do not know how much of a house is exempt from taxes, if any, but this states that there is a combined property tax in Albany of $34 per 1000 of value. If there is no exemption that tax would be around $6800 a year on a $200,000 house. That number is mind boggling to people that in the west.
talked to a guy in cornwall,ny- 14k for a 1800 sq foot house 2 commuter hours for NYC.
dnc and union rule gets taxes on the move
West Point area. What a hole.
Wow, look at the property taxes on this house:
http://www.zillow.com/homedetails/100-Fairlawn-Ave-Albany-NY-12203/29640237_zpid/
“Wow, look at the property taxes on this house:”
+1 Indeed. Where does all that money go?
‘After sitting moribund for years in the wake of the dotcom implosion of 2000 and the financial meltdown of 2008, the IPO market roared to life in 2013. More than 220 companies raised $55 billion last year and 2014 is off to an even faster start. While the boom delights VCs and investment bankers there are those who see more than a bit of irrationality in the public’s appetite for new issues.’
“The Fed has managed to create a bigger stock market bubble than the one we had in the 1990s and a bigger real estate bubble than the one that burst in 2008,” shouts Euro Pacific Capital’s Peter Schiff in the attached video. “Imagine how bad it’s going to be when these two bubbles burst simultaneously.”
‘While his ire is understandable, if Schiff is right about the public avoiding speculation in stocks or houses it’s actually great news for Mom and Pop investors. Speculation in equities can be a disaster for individual investors but it was the housing collapse that nearly sunk the global economy and left millions of people at risk of foreclosure. The surprise is less that home ownership rates are low than the fact that American politicians are once again peddling the notion that the ability to secure a high-risk mortgage is part of the American Dream. In an environment of slow job growth and illiquid housing the last thing on earth most people need is to be saddled with mortgage debt and tied to a residence in a state where there may or may not be job opportunities.’
‘Populist rage aside if there’s one lesson to be learned from the debacles of the last 15 years it’s that gambling on get-rich-quick IPOs and flipping houses is a recipe for disaster. When the music stops, and it always does, whoever gets stuck holding shares with no intrinsic value and a house they can’t afford is ruined (unless they happen to be wealthy enough to qualify for a government bailout, but that’s another column).’
“The Fed has managed to create a bigger stock market bubble than the one we had in the 1990s and a bigger real estate bubble than the one that burst in 2008,” shouts Euro Pacific Capital’s Peter Schiff in the attached video. “Imagine how bad it’s going to be when these two bubbles burst simultaneously.”
And what’s most disturbing is that as the duration extends, the greater the calamity will be.
The only rational action an individual can take is to stay in cash, shed all debt, shed all depreciating assets.
The longer the duration extends, the louder the noise inside the MSM echo chamber will become up until the sound of a deafening POP puts a definitive end to the clamor.
I’d be interested in the sector breakdown of these 220 IPO’s. They can’t all be social media.
San Diego Housing Prices Dive 12% YoY; Inventory Balloons 83%
http://www.movoto.com/san-diego-ca/market-trends/
Seattle, WA Housing Prices Crater 8% YoY
http://www.movoto.com/seattle-wa/market-trends/
Bend, OR Housing Prices Submerge 15% YoY As Inventory Floods Market
http://www.movoto.com/bend-or/market-trends/
“…… He believes city officials should encourage developers to build ‘work force housing that doesn’t take up a lot of space,’ …”
Why do New Hampshire government officials believe young professionals with children want to raise their families in sardine cans in the city? They need to understand the market and embrace it. This “redevelopment” attitude is just pouring money down the drain. Parents want yards and sizable homes in which to raise their children. No amount of money spent will change that factor.
I want 3 no-show jobs at $400k/yr too.
Why do New Hampshire government officials believe young professionals with children want to raise their families in sardine cans in the city?
Is there such a thing still? I thought that the majority of kids are now born to single women on welfare.
I just checked. It’s a “mere” 40%. So it’s not the majority, at least not yet.
http://www.cdc.gov/nchs/fastats/unmarry.htm
I don’t agree with that. There are quite a few young professionals who are alienated by suburban living and everything it entails, from car dependency to ugly, sterile tract McMansions to malls and big box stores. I’ve been to Portsmouth and liked the restored historic section of town very much.
I’m a parent, and I don’t want a yard and a sizeable home to raise my child. We have a neighborhood park we can walk to, and a big house is just more time spent cleaning.
Salinas, CA Housing Demand Plunges 22%, Now At 5 Year Lows
http://www.zillow.com/local-info/CA-Salinas-home-value/r_54288/#metric=mt%3D30%26dt%3D1%26tp%3D6%26rt%3D8%26r%3D54288%252C35767%252C113865%252C27215%26el%3D0
San Luis Obispo, CA Rental Rates Crater 20% YoY
http://www.zillow.com/local-info/CA-San-Luis-Obispo-Metro-home-value/r_395061/#metric=mt%3D46%26dt%3D1%26tp%3D4%26rt%3D6%26r%3D395061%26el%3D0
‘The housing recovery is leaving minorities behind’
“Minority borrowers tend to be over-represented among lower FICO scores.”
In other words minorities don’t fulfill their obligations.
‘New Jersey residents aren’t saving for retirement like they used to. A recent report from the Employee Benefit Research Institute finds 46 percent of all workers have less than $10,000 saved for retirement, and many have nothing at all.’
“If you look at the numbers since the Great Recession technically ended in 2009, after-tax incomes, that is in terms of the purchasing power – real take-home pay, that’s been going down for workers. The job market is still not great. Pay raises have not been as robust, so people in effect, they have less income that they could utilize to allocate toward retirement,” said Maury Randall, chairman of the finance department at Rider University.’
‘On the plus side, Randall said the housing market is improving, which is increasing the value of homes and giving people who have been underwater better financial footing, but income levels do continue to lag across the board.’
‘More Americans are confident about their retirement prospects for the first time in seven years, but even so, more than one-third of workers (36%) have a measly $1,000 saved for their later years, according to a new study by the Employee Benefit Research Institute. (Compare that to the 28% of workers who said they had $1,000 saved in last year’s survey, and the picture gets a little more grim.)’
You can’t buy a rich guy’s vote with snap and gov cheese. Romney was about 30 points too low calling 47% parasites.
They bought the rich man’s vote with open borders and globalization.
You can’t buy a rich guy’s vote with snap and gov cheese
With a SNAP card, definitely not, but you can certainly buy it. It just takes a lot more than a $500 a month SNAP card benefit. Like maybe a taxpayer funded, billion dollar stadium for the rich guy’s NFL team.
$1,000?!?!?!? That should just be an immediate emergency fund in a liquid account. Some people obviously slept through 2008.
put a fork in it
“Received about a half-dozen offers, including one… that was two-thirds cash from a woman who wrote Grose a letter, professing her love for the property.”
Am I the only one to find the 2/3rds cash offer really bizarre?
Here’s a would-be cash buyer at $400k, obviously at the very limit of what she can afford, and is desperate enough to go into debt with a (relatively small) $200k loan on top?
I get 20% down. I even get 50% down and all-cash. But 2/3rds down plus tiny loan? Seems really desperate and really stretched financially. Very very odd, imho.
governments have never figured out that helping people buy houses that are overpriced only helps to raise house prices, not make them affordable.
Affordable has no meaning if the government helps the purchase, it just indicates that more people are going to need more help.