Bits Bucket for November 16, 2014
Post off-topic ideas, links, and Craigslist finds here.
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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Buying an overpriced house at low interest rates is a financial disaster. The average family earns a couple of million over their peak working years. Should they spend half of it on a house? Should they even look at the numbers over 30 years?
Price $300,000
interest on $200K @ 3.23% $113,000
Texas RE tax (3%) $270,000
insurance (1%) $90,000
maintenance (2%) $180,000
total $953,000
Picking up Pecans Priceless
The only justification for such financial suicide is the blind hope for eternal price gains.
What makes you think interest rates will ever again go up?
Wage Growth Is the New Inflation Rate
By Dunstan Prial
Published November 12, 2014
FOXBusiness
First it was the unemployment rate. Then it was inflation. Now workers’ hourly wages could be the key economic indicator that will determine when and how the Federal Reserve will eventually raise interest rates.
When wages start to rise such that consumers increase their spending, it will help drive up demand for goods, which in turn will lift prices toward the Fed’s target rate goal of 2%. When that happens, the central bank will start gradually lifting short-term interest rates from the near-zero range where they’ve sat for nearly six years.
But, as Janet Yellen and other influential Fed officials have vowed time and again in recent months, it won’t happen before then.
Indeed, Yellen and her colleagues have said interest rates won’t start moving higher until the central banks achieves its dual mandate of full employment and price stability, which the Fed has defined respectively as an unemployment rate in the range of 5.2%-5.6% and inflation at a range of 1.7%-2%.
As the Fed has begun the transition back toward a policy of “normalcy” after years of unprecedented stimulus in the wake of the 2008 financial crisis, central bank policy makers have already cycled through two of the most historically important economic indicators – the unemployment rate and inflation – as barometers for the health of the economy.
Two Percent Inflation Goal Has Proven Elusive
Former Fed Chair Ben Bernanke famously suggested in June of 2013 that the Fed could begin raising interest rates when the unemployment rate fell to 6.5%. Then the unemployment rate unexpectedly started to drop, from 7.5% at the time Bernanke made his comment to its current six-year low of 5.8%.
But Fed economists were quick to note the headline unemployment rate hardly told the whole story of the health of U.S. labor markets. Consequently, the Fed backed away from Bernanke’s 6.5% threshold and established the new range focused on the Fed’s dual mandate, which also includes the inflation target.
While that 2% inflation goal remains in place, it has become increasingly elusive. That’s why workers’ average hourly wages has emerged as the latest economic indicator scrutinized by the Fed to determine when to raise interest rates.
Wages have been stagnant for months even as the unemployment rate has tumbled. According to figures released by the Labor Department last week, average hourly earnings for all employees on private nonfarm payrolls rose by three cents to $24.57 in October. Over the past year, average hourly earnings have risen by just 2%, or well below the 3%-3.5% rate the Fed views as necessary to raise inflation to that desired 2% target rate.
So what’s keeping wages stagnant despite the sharp decline in the unemployment rate, and a healing economy that’s creating on average more than 220,000 jobs each month over the past year?
“There’s still a large amount of slack in labor markets, more than the unemployment rate alone would suggest,” Gus Faucher, senior economist at PNC Financial Services Group explained.
It’s that “slack” that’s keeping wages low because as long as it’s there, it creates a surplus of workers, which means employers have no reason to raise wages in order to keep or attract employees.
Reserve Pool of Workers Keeping Wages Low
…
“…an unemployment rate in the range of 5.2%-5.6%…”
Has the NAIRU dropped?
The first graph on this page shows the CBO’s estimate of the NAIRU. Apparently the recession pushed it up by 1 percent. It’s come down just a bit lately.
forgot the link
http://www.vox.com/2014/11/14/7027823/nairu-natural-rate-unemployment
RIP Big Bank Hank, one of the three from the Sugarhill Gang. Just heard he died a few days ago.
Apache
Rap In Peace
well as anyone seen credit card rates go down?
Those are different, as they carry a large risk premium against default on personal debt.
Also note that short-term (one-month) credit card interest rates are 0%.
Why would anyone carry a credit card balance? Stupid beyond words.
Housing prices resumed cratering irrespective of interest rates.
If you are caught in a huge debt trap in deflation, another question might come to you.
Average rent for comparable 300k house $2500×12 is 30k/yr
times 30years =$900k (a little less than the $953K)
Also, a house bought for 300k will be worth in 30 years?? -between 800k and 1m- historically
Therefore, in your example, owning will make this homeowner close to a millionaire after 30 years because the house will be paid off and if he were a renter all these years, he would be penniless.
Financial disaster? think again.
Long term homeownership makes sense. As does other investments-like stocks.
It does not make sense for people who tend to move every 4 or 5 years because of closing costs and the fact that mortgages tend to be top heavy in interest early on.
For the average person, home buying for profit or net worth generation is folly
So all of us homeowners are just millionaires in waiting? That. is. awesome. I, for one, can’t wait.
Thank you for your enlightening comment. Please post more.
“…if he were a renter all these years, he would be penniless.”
So enlightening!
So all of us homeowners are just millionaires in waiting? That. is. awesome. I, for one, can’t wait.
Thirty years is a long wait. A million bucks also won’t sound so impressive thirty years from either, if you live that long.
I prefer to cultivate my $1 million plus today. Not throw it away on depreciating junk in hopes it won’t be a ……depreciating worthless pile of junk in 30 years.
Sh!thouse poet is back
“Average rent for comparable 300k house $2500×12 is 30k/yr”
Wrong.
Current price per square foot rents/yr are roughly half the cost of current price per square/yr total cost buying.
Here’s a hint-$300k for a house is your outlandish notion. There isn’t a house on the planet that can’t be built for a less than half that amount. We build them every day.
Also, a house bought for 300k will be worth in 30 years?? -between 800k and 1m- historically
Really? Historically? Got something to back that up?
Houses depreciate. i.e, they go down in price. If you were dumb enough to pay $300k for a house, you’ve got coming to you exactly what you deserve. You’ll have $1million in a house that won’t sale for more than $100k. The renter will have banked $500k in the same 30 years.
Long term homeownership makes sense.
Paying massively inflated prices for anything never makes sense.
Yes. That truth is a painful outcome for you and millions of others.
“Average rent for comparable 300k house $2500×12 is 30k/yr”
Wrong.
Current price per square foot rents/yr are roughly half the cost of current price per square/yr total cost buying.
It could be that he’s referring to the average rent over the next 30 years. However, any attempt to estimate that would be a wild guess.
Average or median rent isn’t $2500/month.
Worse yet, rental rates are falling.
‘a house bought for 300k will be worth in 30 years?? -between 800k and 1m- historically’
‘For the average person, home buying for profit or net worth generation is folly’
I don’t follow this last statement. You are saying all a person has to do is buy a house, stay in it for 30 years and sell for a million bucks. Every house owner must then be rich.
Put the $300,000 in a total world market index fund instead. It will not only be worth several million bucks at the end of thirty years, but you will have avoided the interest payments, property taxes, insurance costs, maintenance costs, and the costs of moving to escape encroaching slums when that nabe inevitably becomes like Detroit.
Vtiax for international and VFIAX for domestic.
Put the $300,000 in a total world market index fund instead.
This isn’t a fair comparison unless the bank is willing to loan a person the 300K for the index fund the same way it is for the house - and then you’d have to deduct the interest paid back to the bank for 30 years.
One would have to do the math putting the down-payment and then the monthly P&I and tax payments, etc. into the fund.
I don’t know which one is better because I can’t see the future in 30 years and there a a million random variables…I don’t think it’s as clear to me as it is to you
Blue
How about renting over 30 years?
I get your drift, but it’s not objective. How about the MID? (worth something to some)
We sacrificed to pay cash, but not everybody
has that option. I subscribe to live and let live.
In So Ca and other areas, even with market ups and downs, over 30 years, you usually make $.
IIRC, you live on a boat, which is cool, but it isn’t feasible for everybody.
Money isn’t “made” on a house. It’s an expense that haunts you forever.
And the MID is worth nothing to 80% of all borrowers(suckers).
If he itemizes, the RE taxes are probably “worth” more to him than MID. We could give him a tax credit in here, but since it is a comparison to my house and my lower cost house, I get a windfall from the Standard deduction that is probably bigger.
“If he itemizes, the RE taxes are probably “worth” more to him than MID.”
Not to mention insurance, after-tax interest payments, HOA dues, Mello-Roos, maintenance and repairs, etc etc etc.
So long as real estate always goes up enough to more than offset all of the above, owning is cheaper than renting.
“over 30 years, you usually make $.”
I understand that has been your experience. All of your experience has been credit expansion. What about the next 30 years, will it be the really really big wonderful day credit expansion?
In a society at peak debt, will they be able to squeeze any more blood from the stone? Household debt levels jumped till the mid-2000s and now they’re back up to peak levels.
The mortgage finance market went from a private market prior to the Great Depression, then to a public-private hybrid, then to a purely public model after the previous model didn’t provide sufficient levels of profit to the FIRE sector. No private organization would buy mortgages at these prices/interest rates, only the government. All done to keep injecting money into the FIRE sector for donor-dictated suitable profits.
Perhaps the next step is just printing money and handing it to the FIRE sector, and skipping inflating house prices entirely (not a bad idea really - it at least alleviates the impact of peak debt). It sounds ridiculous but not really - they’ve done everything the FIRE sector has wanted: peg mortgage rates at 4%, buy virtually all the mortgages generated in the US, bail out the GSEs, have the Federal Reserve print money and inject it into the FIRE sector. The bottom line for the FIRE sector is to keep the profit rolling in. House prices are are incidental to that goal. And Tim Geithner famously said the novel interventions were to foam the runway for the banks.
The entire real estate scam is designed to distract you from ever looking at the total cost over 30 years. Less than 10 percent of people understand things like the cost of the house including the interest and the lack of any real tax benefit in most cases.
Technically it’s a total cost of around 7 years on average for those with a 30-year mortgage, after which they relocate and pay their share of another real estate commission and closing costs. And unless they are lucky enough to buy during a mania, when price appreciation is far higher than historic norms, they will lose money, as almost all the mortgage payments for the first several years of a thirty-year mortgage are interest payments.
They don’t understand that aspect either.
maintenance (2%) $180,000 ??
$6,000. per year in Maintenance ??
What is your suggestion? $2/ft2 or maybe $4,000? 1%? $3,000? Heck, the riding mower keeps one from going too much lower.
What is your suggestion ?
Don’t have one….Its impossible to estimate without more information..New house vs old house…Thats why I questioned your stated estimate…
$2-$3/sqft per year.
Get over it.
It is ironic that the bubble house pushers actually have no idea what the constant struggle to keep one “like new” and all trimmed out can cost. Not even a bad idea, just no idea at all.
Don’t act so friggen stupid Blue…Starting to sound like HA…And I am not a friggen housing bubble pusher either so stick that where the sun does not shine…
Maybe I will put it in terms that you understand…Whats the yearly maintenance cost on a new boat vs a old boat ?? Starting to get my drift dude…
Look my friend. You can play stupid and silly games here all you want here. You’re the one that made the claim you’re in the construction biz yet you haven’t been able to substantiate that even once. On the other hand, I built $7.6 million in work in 2013. You may not like the fact that depreciation or maintenance cost as you like to call them are $2-$3/sq ft per year but your opinion of it has no bearing.
It is about the same, depends more on the size of the boat than the age. Stuff still breaks, wears and has to be “maintained”. Of course, an old boat that never was maintained properly is a disaster.
So, if you ever had a house, what did you spend to keep it “like new”? Just round numbers is fine.
Of course, an old boat that never was maintained properly is a disaster ??
Exactly my point…Without more information, a lot more information, there is no way to estimate the annual cost of maintenance on a house just like the boat…
So, if you ever had a house, what did you spend to keep it “like new”? Just round numbers is fine ??
I have had many houses…One had a Terra Cotta Roof….Annual maintenance cost (assuming you kept people off of it) just about zero…Maybe replacing the mortar in the ridge ends every 15 years or so…Thats No more than $500.
On the other hand, I have owned Historical houses…Late 1800’s & early 1900’s…They are a maintenance nightmare from hell…A big, gigantic black hole for money…It never ends…
How long does that roof last Dave?
Let’s assume Mr. Halfamil doesn’t have an historic Victorian or such. I had one of those two. Coincidentally, it was a million dollar house, depreciated to $50K. I tried to make it a $100K house. Oh my.
The ongoing confusion caused by a lack of economic reality:
‘As large parts of Europe’s economy grind almost to a halt, attention will focus this week on the latest assessments of business confidence in the euro zone and Germany, which has just narrowly avoided a recession.’
“The euro zone is the best part of 20 percent of the global economy,” James Knightley, an economist with ING, said. “The longer the stagnation goes on the more Japan-like it becomes.”
‘The euro zone’s problems have raised expectations that the European Central Bank is preparing to loosen its purse strings further to try to rekindle growth.’
‘The health of China’s economy, a growth-driver for the United States and Europe, has also been a major concern given signs that growth is faltering. The communist country’s economy now mirrors those of its rivals in the West and is having to confront many of the problems they have faced from rising wages and property bubbles to demands for stricter environmental standards.’
‘As global demand for its goods has slowed, its manufacturing costs are rising, prompting some companies to shift to cheaper neighbors such as Vietnam. The Chinese government has tried to head off a sharper slowdown in the economy, on track to grow at its slowest pace in 24 years, by easing some curbs on the property market.’
‘Such restrictions on second homes, for instance, had been introduced to dampen runaway property prices in cities such as Beijing, where the cost of a two-bedroom flat can reach $1 million.’
The suggestion is Europe just needs to print more money. It hasn’t worked here or there because Europe hasn’t done its part. No questioning of why it has only resulted in enormous imbalances like a $1 million sky box in Beijing.
‘Such restrictions on second homes, for instance, had been introduced to dampen runaway property prices in cities such as Beijing, where the cost of a two-bedroom flat can reach $1 million.’
How many Chinese real estate investors are going to find themselves the proud owners of multiple empty housing units with no practical use, once the music stops playing?
‘The health of China’s economy, a growth-driver for the United States and Europe
How exactly is the health of a protectionist economy that only grudgingly imports what it can’t make itself, a growth driver for the USA and the EU? I would think that raw materials suppliers like Oz and Brazil are the ones who catch colds when China sneezes.
Dude, if you’re going to be my troll, I’d prefer you add some additional references to your made up numbers, such as:
- my beautiful wife,
- my dog - as far as dogs go, this guy is one of the best dogs ever. He’s only a year and a half and already knows a lot about being a dog. He sees a squirrel, he chases it, give him a bone, he’ll go hide it, throw a stick, he go and fetches it…he learned all this on his own too. He was free, some guy from CL just gave him to me. He is mostly Wheaton terrier. Great little guy. I named him Roscoe.
Hat tip to you for getting your post up early, keep up the good work.
Is that a tapdance or backpedal?
Look ibbots, you called me out. Said it was absurd that I’d pay half a million less for my house over thirty years than you. I have just asked for your numbers. What are you afraid of? You gave the loan amount and interest rate and challenged me to some math, then won’t yourself. So you remain the silent Halfamillionmore. It’s not trolling to ask for truth. It is probably irritating to everybody for me to ask for several days.
No disrespect to your beautiful partner, we have that in common. Nor to your dog, mine is a fine animal as well. I have otherwise not mentioned them. We are talking about a housing bubble, of which it appears you are a rather pedestrian and content citizen. That’s the thing about this housing mania that interests me, when it is challenged there is a knee jerk insult, and then just a blank.
Woof, woof. WTF are you talking abiut here?
It’s Jingle_Fraud.
Still trying to figure out how you came up with your RE tax and insurance totals…
Let’s find out from the Pecan Pimp…..
“Pecan Pimp”
He won’t show the goods, I’d wager.
I googled Texas RE tax rate and saw the number 3%. Doesn’t shock me, we have that rate in NY, and Texas has no income tax. It probably varies by county and town. My own homeowner’s insurance is 1% of my appraised value. I have no clue what it is on a house 10 times the value of mine. This is why I asked for input. It’s a big secret I guess, among those who have really expensive houses.
Fixt.
It’s a big
secretsource of embarrassment I guess, among those who have really expensive houses.Today’s $300000 house 30 years later will worth $3000000.00 if you count that American fiat money is loosing 10% every 5 years to inflation…
Strange that would be considering there has been nothing but deflation for the last 30 years.
What comes after the biggest credit expansion in the history of the world, an bigger credit expansion, and then a bigger one? How much are your wages going up every year?
The bitcoin stories you read today are starting to sound a bit insane…par for the course in a mania, I suppose.
Ministry of Innovation / Business of Technology
Man has NFC chips injected into his hands to store cold Bitcoin wallet
Entrepreneur: “It’s not cold because it’s 37 degrees Celsius inside my body!”
by Cyrus Farivar - Nov 15 2014, 8:00am PST
Any serious Bitcoin user will preach the benefits of cold storage: keeping the bulk of your bitcoins offline somewhere, like on an encrypted USB stick, or even printed on a piece of paper. The idea is that by keeping that data offline, it’s far less susceptible to being hacked.
So, the theory goes: what could be safer than keeping it inside your own body?
For the last 10 days, Martijn Wismeijer, a Dutch entrepreneur and Bitcoin enthusiast, has lived with an NFC chip embedded in each hand. One has data that he’s constantly overwriting; he can put his contact details in simply by having another person scan his hand with an NFC-enabled phone. But the other contains the encrypted private key to his wallet.
“I use it for cold storage, but it’s not cold because it’s 37 degrees Celsius inside my body!” he told Ars over Skype on Friday.
Specifically, he has an “NFC Type 2 compliant NTAG216 RFID chipset” embedded in a tiny glass capsule (2 millimeters by 12 millimeters) that was injected into the fleshy part of his hand between his thumb and index finger. Each capsule can hold just 880 bytes of data, which is more than enough for a cold storage wallet. The Dutchman got it as part of a pre-loaded syringe sold as a $99 kit from DangerousThings.com, a Washington State-based website that sells to hobbyists and biohackers.
On Nov. 3, 2014, Wismeijer had it installed by Tom van Oudenaarden of Piercing Studio Utrecht after his own Amsterdam doctor refused.
“My doctor doesn’t like it!” Wismeijer said. “He didn’t want to do it, he just wants to make people better, and I’m not sick—I just want this thing inside my body. He was right, so that’s why you need body manipulation artists.”
…
” I’m not sick—I just want this thing inside my body”
Could make for a painful mugging.
Or a gruesome inheritance.
How is the housing recovery shaping up in your area?
This is what a centrally planned housing market does.
A very strange housing recovery in Mass.
By Jay Fitzgerald | Globe Correspondent
November 16, 2014
A year ago, it seemed nothing could stop the Massachusetts housing market recovery.
Bidding wars broke out for properties, sales jumped, and prices followed. Foreclosures declined and new home construction rebounded. Everything seemed to be coming together, five long years after the financial crisis that followed last decade’s housing bust.
Flash forward to today: Sales are down, foreclosures are up, and buyers are walking away from pending deals. Construction of new housing is falling again. To top it off: Single-family home prices in September fell compared with the same month in 2013, the first such price decline in two years, according to the Warren Group, a real estate research and publishing company.
Real estate agents and others in the industry describe the market as “schizophrenic,” “weird,” and “baffling.”
…
Cause anyone who wants to own a home in Honolulu should be able to afford one:
Housing crunch in Honolulu may ease soon
By Nestor Garcia Published: November 15, 2014, 6:16 pm
Updated: November 15, 2014, 6:18 pm
Can anything be done to make homes more affordable for people in Honolulu?
According to the Honolulu Board of Realtors, a single-family home last month sold for a median price of $690,000. A condominium sold for a median price of nearly $353,000, an eight percent jump over the same month last year.
On Saturday, a housing summit sponsored by the non-profit Faith Acton for Community Equity (FACE), drew an overflow crowd to the State Capitol. Affordable housing advocates like FACE sat with politicians, government officials and developers to discuss what FACE called a housing crisis. But, there apparently seems to be movement to take on the problem.
“There are signs of hope now,” said the Reverend Bog Nakata, a spokesman for FACE.
One sign will be a move at the Honolulu City Council next week to relax the restrictions on so-called ohana or family zoning. That’s when a property owner attaches a living unit to the house.
“So that these units are then available to anybody – doesn’t have to be a family member,” said Nakata. “And that’s going to open the door for maybe thousands more affordable units.”
…
Real Estate
Foreclosure Backlog Slows Housing Recovery in Some States
Report Pegs Florida, New Jersey and New York as Among Hardest Hit
By Joe Light
Nov. 14, 2014 1:18 p.m. ET
The U.S. foreclosure crisis has largely wound down, but some states still face a giant backlog of delinquent properties that could bog down local housing markets for years to come, according to a report released Friday.
While in most states the percentage of loans in foreclosure has dropped sharply as the housing market and economy has recovered, three states—New Jersey, Florida and New York—have rates more than twice the national average, according to a report from the Mortgage Bankers Association.
Those states are among 22 so-called judicial states with some of the slowest foreclosure machinery in the country, which has drawn out the pain of the housing bust. In judicial states, lenders are required to file a court complaint against borrowers, who then get a chance to dispute the facts of the case, sometimes in front of a judge. The entire process can take well over a year.
The biggest backlogs of properties in or near foreclosure could take more than three years to work through, said Thomas Showalter, chief analytics officer at independent mortgage processor Digital Risk.
And since foreclosed properties, which are often vacant for months and have damage, typically sell for lower prices than others, that process could hold home prices back in some of the worst-hit areas, he said. “You’re going to see house prices attenuated in those places,” Mr. Showalter said.
…
Fewer marriages impact housing recovery
November 15, 2014 12:00 am • By Jim Woodard Creators Syndicate Inc.
This is definitely not a marriage column, but current trends related to marriage and childbirth have a direct influence on home sales.
The steep decline in the number of marriages in the U.S. among the population aged 25 to 29 has been a key factor in the slow recovery of the housing market, according to a report from John Burns Real Estate Consulting.
According to data from the U.S. Census Bureau and the American Community Survey, the percentage of men in the U.S. who are married has declined by 48 percent since 1970, while the percentage of married women has fallen by 43 percent for that same period.
Since life-stage changes such as marriage drive the housing market, the fact that more and more people are remaining single until later in life is keeping many of these people from buying homes, making the declining number of married persons in the U.S. “one of the biggest game changers in the housing industry,” according to Burns.
The report found that not only are singles more likely to rent rather than own, but they also are more likely to live in areas close to entertainment and employment. Also according to the study, the number of cohabiting couples in the U.S. has steadily increased in the past few decades, and the rate of homeownership among cohabiting couples is far lower than that of married couples.
The desire to own a home is often ignited by marriage, according to the Burns report. Also, the addition of children to the family greatly increases the need to own a home due to the need for a yard, more space and social interactions — and delaying marriage often coincides with delaying the addition of children, thus in many cases further postponing homeownership.
…
There’s another point to consider. A married couple will typically own or rent one unit of housing - whether it’s a house, apartment, etc. Two single people will need two units. So the decline in the marriage rate should increase the demand for housing somewhat.
But they’ll each typically occupy about half the square footage when single. A plus for apartment/condo demand, a minus for SFH demand.
Not surprising that new apartments are being built in relatively large numbers, while new SFH construction still languishes.
Not “about half” but less than half. Typical married people do not buy two bedroom houses. Most houses have three bedrooms. One bedroom apartment for a single is less than half the square feet. in addition, it is usually in multiple unit dwellings and more environmentally efficient. Fewer roads need to be paved. fewer miles the mail delivery will take, etc.
Two single people will need two units. So the decline in the marriage rate should increase the demand for housing somewhat ??
Yes but what kind of housing ?? Hence, we have seen massive multi-family construction across the country going on…
Mark Taylor is a high end apartment business in Phoenix and other cities, and constructing brand new multiple unit complex in my area of Phoenix. It is in Tempe, short drive to the high tech corridor and lots of places to work out at, eat, etc. a place for young professionals and smart older professionals. Some of the units have attached garages. That is typical of Mark Taylor. In OC the places that are close to it are Avalon Bay communities but I don’t think they have attached garages.
Survey: Many Still Believe Housing Recovery Still Three to Five Years Away
Author: Tory Barringer November 11, 2014
In a quarterly survey of more than 100 real estate experts and economists, real estate data firm Zillow found 40 percent of respondents believe it will take another three to five years for the housing market to normalize, based on current home price trends and homebuyer activity.
Nearly a third of panelists took a more optimistic view, predicting the market will stabilize one to two years from now, while one in five responded that housing has either already returned to normal or will within the next 12 months.
When asked about headwinds facing the market right now, respondents pointed to low household formation rates, which have been stymied in part by a challenged economy. According to another recent study from Zillow, more than a third of adults living in the U.S. were living with at least one roommate as of 2012, up from a quarter in 2000.
While those renters represent millions of potential new formations in the years to come, they remain stuck where they are as jobs and wages slowly grow.
Demographic issues are also at play, Zillow reported. While more millennials seem to be holding off on major commitments—including homeownership, marriage, and parenthood—a growing number of Americans nearing retirement age are also opting to stay in their homes longer, keeping the nation’s housing inventory from making any meaningful recovery.
…
Chinese investors pump $22 billion into California housing market
By Sharon O’Malley | November 2, 2014
Dive Brief:
* Wealthy Chinese investors have bought $22 billion worth of residential real estate in southern California in the past year, helping to revive the housing market there, according to the National Association of Realtors.
* The influx of money has led to the creation of a cottage industry of realtors, bankers, and lawyers, who are needed to manage the transpacific transactions.
* Because of a Chinese law that prevents its citizens from transferring more than $50,000 a year out of the country, the complicated real estate transactions can involve multiple investors and funding sources.
…
I’m seeing a lot more FSBO houses now then ever before. Our local search engine will list FSBOs along with MLS/listings, and it’s surprising to see people selling their house all by themselves. (Not that I can blame them necessarily)
$400+ per square foot in Region VIII
Where is region VIII, Cat?
$347,000
864 square feet
Built in 1926
http://m.trulia.com/homes/Colorado/Denver/sold/994313-803-S-Grant-St-Denver-CO-80209
The weeds in the front yard are a nice touch. Makes it “real”.
Wow…Thats seems kinda pricey Goon…This would be considered a good area of Denver I suppose…
It is technically Washington Park so that price doesn’t surprise me. The new “owner” told me he has sunk $28K into that place so far.
The area west of I-25 has been rebranded as “West Washington Park”. The demolition of the Gates rubber factory at Broadway and Mississippi was completed a few months ago and a massive infill development is going up soon. Recently completed “luxury rentals” across the street are asking $1,500 a month for studios.
The area west of I-25 has been rebranded as “West Washington Park”.
How close to the interstate is that area? Can you hear the noise from the traffic when you walk around the neighborhood?
Is it close to downtown Denver ??
Per Google Maps it is 2.8 miles due south of the state Capitol.
Screenshot shows proximity to I-25 and the I-25/Broadway transit hub. The infill development of “West Washington Park” is centered on Broadway and Mississippi. The “Green Mile” which is the largest concentration of legal recreational marijuana dispensaries in the world is Broadway between Mississippi and Evans.
http://www.picpaste.com/realtors-are-liars.JPG
Nixon’s Federal Regional Councils - FEMA and EPA Regions
http://www.spingola.com/regionalism_maps.htm - 5k -
Dropping below $100 sq ft in conservative parts of Region IX.
It seems to be slowing down.
Slowing down here in this part of Florida, too. Lots of folks very unhappy they can’t sell their homes for what they wanted, but they’re their own worst enemies, they sat the fence hoping for a little more appreciation prior to selling. Some people who put high FSBO prices are now scrambling to find a realtor who can just get the shack sold. Interesting to watch the dynamic, or at least reading some of the local RE forums.
“Why isn’t my house selling? Why? Why?”
The market in North SD County is virtually dead. And it’s not the weather.
I think that anybody who owns a home should also pay my health insurance! It’s only fair!
My neighborhood just saw this property down to 616k
it’s worth 416k
http://www.zillow.com/homedetails/1308-Knoll-Dr-Oceanside-CA-92054/16614439_zpid/
Decent house…Nice view…Gas line on fire pit seems to be a after thought…Why didn’t they put it internally…Gee’s…
There’s about $50k in materials,$50k in labor and what’s the 1/8th acre lot worth….. $1500 at best?
It seems to be slowing down ??
November/December….Pretty typical….
Falling YoY is typical.
14 November 2014
Last updated at 07:13 ET
Oil prices likely to fall further, says IEA
Oil prices are likely to continue falling well into 2015, the International Energy Agency has said.
The IEA, a consultancy to 29 countries, said weak demand and the US shale gas boom meant crude’s recent fall below $80 a barrel was not over.
On Friday, Brent crude, one of the major price benchmarks, traded at $78.13 a barrel, near a four-year low.
“It is increasingly clear that we have begun a new chapter in the history of the oil markets,” the IEA said.
“Barring any new supply problems, downward price pressures could build further in the first half of 2015.”
The organisation, set up after the “oil shock” of the early 1970s to advise major oil importing countries, said that pressure was building on the Opec oil producers’ group to restrict supply to bolster prices.
However, there have been reports that Saudi Arabia, Opec’s key member, is not yet willing to turn off the taps. Opec members are due to meet on 27 November to discuss the supply and demand issues.
Most Opec members rely on oil revenues to support economic growth and spending.
Also, it is likely that oil and gas explorers will become increasingly worried that falling prices will make exploration uneconomical.
Brent has fallen for eight weeks in a row, its longest losing streak since 1988, according to Reuters’ data.
…
$2.65 per gallon in my Phoenix nabe this morning.
“Also, it is likely that oil and gas explorers will become increasingly worried that falling prices will make exploration uneconomical.”
Here’s some stock charts of companies that are into oil exploration and drilling and such, ranked my market capitalization:
http://finviz.com/screener.ashx?v=211&f=ind_oilgasdrillingexploration&o=-marketcap
Ripples beginning to be felt within the oil and gas support sector. Layoffs and reorganizations which for some reason haven’t been widely reported on.
They’ve been fracking and exploiting the shale all over the place for years now…why did it take so long for oil prices to drop if the drop is due to that development?
China borrowing to build empty cities. Just might be closing.
Interesting piece on Valerie Jarrett, the power behind the throne.
http://www.politico.com/magazine/story/2014/11/fire-valerie-jarrett-112659_Page2.html#.VGipOjTF_5M
She’s really got a hold on the Obamas. Wonder if it’ll be different after he leaves office.
Why would it be any different? Hillary Clinton and Jeb Bush are also corporate statists and Wall Street fluffers.
Keller, TX(Dallas/Fort Worth) Sale Prices Turn Negative YoY; Down 7% QoQ and 3% MoM
http://www.zillow.com/keller-tx/home-values/
What government debt and kow-towing to meddling supranational bodies does to the productive (real) economy: the case of Italy.
http://wolfstreet.com/2014/11/14/italys-economy-from-hell/
Yep…Italy is the Elephant in the room for the EU…Also France to some lesser degree…If Italy goes down, maybe exits the Euro, what the hell is going to happen…
From the article;
“Youth unemployment is at a catastrophic 43%, up from an already terrible 26% in 2010″.
You think that might be a storm brewing ??
Italians are also fed up with seeing their country flooded with Third World migrants at a time when their own economic situation is dire and worsening.
http://news.yahoo.com/italys-immigration-crisis-moves-sea-streets-111015732.html;_ylt=AwrSyCO.BGlUlm8A6C3QtDMD
Everyone Must Check In
Police Officers Draw Guns During Unannounced ‘Active Shooter Drill’ At Elementary School
November 15, 2014 12:03 PM
Winter Haven, Fla. (CBS TAMPA) – Students, teachers and parents were taken by surprise after an “active shooter drill” brought the Winter Haven middle school into lockdown as armed police officers burst into classrooms with their weapons drawn.
Students at Jewett Middle Academy said they were terrified when police officers burst in the doors for a planned active shooter drill – but students and teachers are irked they were not told ahead of time.
Seventh-grader Lauren Marionneaux told WTVT-TV that when the officers burst into her class with an AR-15, she was in fear for her life.
“We actually thought that someone was going to come in there and kill us,” the station quoted her as saying.
But police say they conduct these drills for the absolute safety of the students.
“These types of drills are vital in order to evaluate not only law enforcement response, but more importantly to educate the students and school officials in case an actual event were to occur,” Chief Charlie Bird said in an email to media.
Parents were notified of the drill through email after it was over, but many parents, however, received panicked texts from their children as the drill was going on.
tampa.cbslocal.com/…/ - 166k -
I thought there were to be no guns in schools, period!
I thought there were to be no guns in schools, period ??
Police do not have rules…They drive around here on their cell phones all the time…I guess they must have passed some special driving training for them to be able to do that but nobody else can..
Yeah, I see that all the time: Various cops (city police, deputies, highway patrol) driving around yakking on handheld cell phones. “Do as I say, not as I do!”
“These types of drills are vital in order to evaluate not only law enforcement response, but more importantly to educate the students and school officials in case an actual event were to occur,” Chief Charlie Bird said in an email to media.
Translation: Let’s teach the sheeple mindless, automatic compliance with any order, no matter how arbitrary or repressive, in the name of “security.”
I was caught in one of these drills on an AF base this last spring. The Airman drew on me and told me to put my hands up. I told him I was a civilian and not part of his drill, and would not put my hands up. He had to call a supervisor to ask how to deal with this situation, fortunate for me I guess. the supervisor didn’t know how to deal with this either and it took them quite a while to ignore me.
I hope St Louis is ready for an @ss whupping
Rams are going down like Michael Brown, LOLZ
Manning’s playing is incredible…Only team that may be able to beat them right now is possibly New England…
“Manning’s playing is incredible…Only team that may be able to beat them right now is possibly New England…”
Or the St Louis Lambs.
Or the Bungals or any number of teams on a given day except for the Oakland Waiters and the NFC South where the Atlanta Falcons lead the division at 4 and 6.
Denver cratered like housing prices.
Losing feeling in my toes
House next door just got foreclosed
everyone must check in
Region IV checking in
ask not what your region can do for you,
but what you can do for your region
http://www.youtube.com/watch?v=P35T7WGu9i0 - 408k -
No cheap pizza tomorrow for you, dude.
Well, Rockstar, with your 5% raise you can afford to buy me lunch
LOL, not so much.
“Debt, Propaganda And Now Deflation”
“… when you equate inflation and deflation with rising or falling prices, you’re not going to be able to know when you actually have deflation. Because prices can rise for all sorts of reasons. Inflation/deflation is the money/credit supply in an economy multiplied by the speed at which money is spent in that economy, the velocity of money.
“It should be obvious that prices for some items can still rise, certainly initially, when deflation sets in. Producers that see less sales can try to raise prices for their remaining buyers. Basic necessities will always be needed. Governments can raise taxes. Rising/falling prices tell us only part of the story, and with a considerable time delay.
“Ergo: rising/falling prices are a lagging factor, and if you look at them only, you will have missed the point where deflation has set in. What follows, obviously, is that you can’t measure deflation by looking at consumer prices (CPI) or production prices (PPI) numbers. You’d be way behind the curve. CPI and PPI tell you something, but they don’t tell what causes falling or rising prices. And that is a valuable thing to know.
“Deflation is always bad. It either occurs when money/credit is so short that people can not get their hands on it no matter how hard and productive they work, and how much demand there is for their products, or it occurs when people are too poor, too much in debt or too reluctant to part with what they have.”
http://www.zerohedge.com/news/2014-11-15/debt-propaganda-and-now-deflation
“Inflation/deflation is the money/credit supply in an economy multiplied by the speed at which money is spent in that economy, the velocity of money.”
Lookie here, here’s a money velocity chart:
http://research.stlouisfed.org/fred2/series/M2V/
Peaked in Q3 1997 and has been on a downward trend (with a couple of big blips) ever since.
Nice post combo…
Sunday’s funnies dedicated to Gruber’s “stupid voters” who enabled Obamacare.
http://www.theburningplatform.com/2014/11/16/sunday-funnies-37/
http://www.youtube.com/watch?v=YfGLB8LO1aM
Brazilian cannibal gang given long sentences Made pies & pastries out of their victims & sold some to neighbors. The three reportedly told police they belonged to a sect that preached “the purification of the world and the reduction of its population.” Probably lessened the carbon footprint of their victims to boot.
been hanging around in jeffrey dahmer’s old stomping grounds in bath?
soylent green is people
Tune in tomorrow for more compelling links to data and in depth discussion sure to strike fear in the hearts of housing hucksters.
Bright and early now.