The First Rule Of Holes
7 San Diego reports from California. “Construction sites abound in east Chula Vista. In Otay Ranch, many homes are selling before they’re even built. Dennis Almario would know. He just bought his home in Otay Ranch. ‘We already got about $75,000 in equity after a year when we bought it,’ Almario said. It’s a great gain for Almario who lost a previous home to the mortgage meltdown a few years ago. ‘This will be another income for me and my family and my future and my kids and grandkids to pass along,’ Almario said.”
The Times of San Diego. “A slowdown in the local real estate market continued last month, according to the San Diego Association of Realtors. About 1,400 single-family homes were sold in November, a 22 percent decrease from October. While the SDAR chalked up the drop to a normal holiday season decline, the figure was also 14 percent below the same time last year. The median price of a house that sold last month was $491,000, a 1 percent decrease from the month prior. The price tag remained 5 percent higher than the same month in 2013. The median price of a condo was $325,000 in November, 4 percent below October but 5 percent above November of last year.”
“‘Opportunities exist in every market, and current conditions have been a plus for first-time buyers and people returning to the market,’ said Leslie Kilpatrick, SDAR’s board president.”
The Yakima Herald in Washington. “While sales are improving, plenty of pricey homes remain on the market. As of the third quarter of this year, Yakima County had enough homes over $500,000 to supply the market for nearly two years (21.3 months), according to data from the Runstad Center for Real Estate Research at Washington State University. That compares to the 13.2-month supply during the same quarter in 2013. ‘We have a large glut of nice homes on the market,’ said John Niedhardt, managing broker for Almon Residential Real Estate.”
The RoanokeTimes in Virginia. “The city council has chipped away at the $10 million debt that it incurred to build a municipal golf course only to see the principal grow and its ability to provide core services falter. Tonight, the council will decide whether it should observe the first rule of holes and stop digging. Back in 2004, as the ribbon was cut on Vista Links, the nation was at the height of a residential golf-course building frenzy, and real estate ventures seemed destined to always appreciate in value. Then the bubble burst. By 2010, the city council said it could no longer afford the $660,000 annual debt payments, so it stopped paying.”
“‘We will have 27 additional years of payments,’ said city attorney Brian Kearney. ‘Do we continue to defer maintenance? To lose teachers to neighboring jurisdictions? To lose good people because we don’t give raises in city hall? This debt is sitting there and will be for many years to come.’”
From Chicago Business in Illinois. “The average time it took lenders to foreclose on a home in the state climbed to a new high of 889 days in the third quarter, up from 828 a year earlier, according to RealtyTrac. It’s the longest time since RealtyTrac started tracking the measure in first-quarter 2007, when the average foreclosure took 243 days. Times are rising even after a state ‘fast-track’ law took effect last year that’s designed to zip foreclosures of abandoned homes though the process.”
“State Sen. Jacqueline Collins, D-Chicago and a sponsor of the legislation, said the longer times suggest the measure is not reducing the gridlock that has left some neighborhoods with too many boarded-up homes in foreclosure. ‘Even though we have this legislation has it really benefited the communities ravaged by the financial tsunami?’ Collins asked. ‘The housing market is seeing an improvement in certain communities but not in hard-pressed communities.’”
The Columbus Dispatch in Ohio. “It shouldn’t require the rape of child — dragged behind an abandoned house as she waited for her school bus — for the Ohio legislature to act on a bill to protect urban neighborhoods blighted by ‘zombie’ properties. And it shouldn’t take a newspaper editorial to suggest that the Senate Finance Committee not block this remedy for reasons that are inexplicable. It ought to send Ohio House Bill 223 — intact — to the floor for passage.”
“The committee is slated to meet this afternoon, sponsors were told, to consider a substitute bill that guts the original intent: a pilot program to speed foreclosures of blighted and abandoned residential properties in Franklin County, Toledo and Cleveland. Their original bill sets up a tightly limited five-year program to let the three urban areas send abandoned houses to auction without conducting a sheriff’s appraisal or requiring minimum bids. Under state law, bids start at two-thirds of the appraised value. But many houses are not worth the cost of repairs.”
“No one bids. The properties sit. Neighborhoods suffer. H.B. 223 would let the market set realistic bids. Even a $1 sale is a bargain for neighborhoods if these properties ultimately are fixed up, occupied and back on the tax rolls. The bill passed the House unanimously on April 2, given fresh urgency: A 13-year-old girl had been raped a day earlier on a five-block stretch of North Linden that had 26 vacant structures.”
“This is the type of bill that Senate Republicans should appreciate. It removes the reliance on government intervention, which spends taxpayer dollars to raze or rehabilitate abandoned properties. It clears the way for the free market to work.”
“‘Opportunities exist in every market, and current conditions have been a plus for first-time buyers and people returning to the market,’ said Leslie Kilpatrick, SDAR’s board president.”
Try to avoid catching yourself a falling knife.
same old rubbish from these folks. I guess 700,000.00 homes are opportunities these days.
We can run some more deficits and bailout homeowners next time too. asset prices are the key to economic growth.
JFraud or one of the other shills was basically claiming yesterday that supply has no effect on price. With people like that involved no wonder we are where we are.
“‘We already got about $75,000 in equity after a year when we bought it,’ Almario said. It’s a great gain for Almario who lost a previous home to the mortgage meltdown a few years ago. ‘This will be another income for me and my family and my future and my kids and grandkids to pass along,’ Almario said.”
With such brilliant financial insights, how could this guy possibly lose?
So this deadbeat loses his house and now he’s talkn about a 75k gain in equity on another house? Man if this sh@t isn’t a house of cards I don’t know what is. why doesn’t the deadbeat pull that equity and pay off his debts on the other house?
Amazing isn’t it? The government will probably drop a helicopter load of cash in his backyard so he can go shopping, stimulate the economy. Me? I’m a debt-free, miserly chit.
So this deadbeat loses his house and now he’s talkn about a 75k gain in equity on another house ??
There use to be a pretty severe penalty for going to foreclosure or bankruptcy as a way to purge your debt…I recall, not long ago it was like 7 years…Then it came down to 5…Now, who knows maybe 2 ??
I sense there is no practical or ethical concern anymore…Remember “strategic default”…That was done by people that had more than enough capacity to service their debt but why do it if I can come back into the market place after a foreclosure or short sale and borrow again to buy a house…Its terrible policy…
it encourages a casino like atmosphere.
“lost a previous home to the mortgage meltdown…”
Apparently he’s a “heads I win, tails you lose” kind of guy. Interesting how he depersonalizes defaulting on his previous loan. Shows how you have to disconnect from reality to live in the mania.
“Apparently he’s a “heads I win, tails you lose” kind of guy.”
Sounds similar to profits are mine, losses are ours? Uniquely ‘merican.
With such brilliant financial insights, how could this guy possibly lose?
The house is in Otay. For the San Diego challenged, that area is right across the border from Tijuana. I couldn’t think of a worse place to live in the San Diego area, except maybe for San Ysidro (San Is Skidrow). As soon as the bubble pops he’ll be underwater again and jingle mail will soon follow.
My sons’ marching band played in a tournament at a high school in San Ysidro. The event was in the evening after dark. I was duly impressed that from the bleachers in the football stadium, you could see the lights of Tijuana glimmering a few miles to the south.
“This will be another income for me”
Wha?????! Is he planning on converting to a rental?? If not, someone needs remedial econ.
He failed the course the first semester and is retaking it now.
He’s probably counting on serial refi cashing out each year.
$75K yearly income for a bit of paperwork.
Because house prices grow to the sky and never stop.
$75K/yr is probably more than his mortgage(s)?
At last!, a financial perpetual motion machine.
Do you guys think uncle fed should start buying oil futures to save GDP?
‘A bipartisan group of congressional leaders reached a deal Tuesday evening that would for the first time allow the benefits of current retirees to be severely cut, part of an effort to save some of the nation’s most distressed pension plans.’
‘The measure, attached to a massive $1.01 trillion spending bill, would alter 40 years of federal law and could affect millions of workers, many of them part of a shrinking corps of middle-income employees in businesses such as trucking, construction and supermarkets.’
“We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable,” said Rep. George Miller (D-Calif.), who along with Rep. John Kline (R-Minn.) led efforts to hammer out a deal.’
‘“We thought our pension was secure,” said Whitlow Wyatt, a retired trucker who lives in Washington Court House, a small city in central Ohio. “That was always the word. Now they are changing that.”
‘Wyatt, 70, retired with a $3,300-a-month pension in 2000 after working more than 33 years as a long-haul driver. He could face pension reductions of 30 percent or more if Congress permits trustees of the hard-pressed pension fund to slash benefits.’
http://www.washingtonpost.com/business/economy/congressional-leaders-hammer-out-deal-to-allow-pension-plans-to-cut-retiree-benefits/2014/12/09/4650d420-7ef6-11e4-9f38-95a187e4c1f7_story.html
This might be mildly deflationary. I wonder if the Fed might print up some money for Whitlow?
only gov workers will get their pensions
I’m little confused by this. Taxi prices have always seemed too high to me. If you dig into it, this is because local governments set up a high tax monopoly. But if Uber can do it, why not anybody with a car?
‘Uber Technologies Inc. has hit an increasing pileup of regulatory and legal hurdles this week, with its mobile application challenged from India to California. The car-booking app yesterday was sued by the district attorneys of Los Angeles and San Francisco over claims that it makes false assurances to customers about drivers’ background checks. That came after a judge in Spain banned Uber from operating in the country.’
“The-low cost premise is starting to look doubtful,” said Erik Gordon, who teaches entrepreneurship at the Ross School of Business at the University of Michigan. “If the lower costs arise from insufficient screening and supervision of drivers and no insurance, the advantage is not sustainable and the valuation could collapse.”
‘Uber also thumbs its nose at regulations when it debuts its service. It typically jumps into a new locale in spite of laws protecting the taxi industry and forces regulators to adapt as consumers embrace the app. Austin Geidt, Uber’s 29-year-old head of global expansion, has said she used to agonize over data on competition and demand in different cities to decide where to expand next. Now the company is moving too quickly to over-think the road map, she said in a recent interview.’
“At this point we go so quickly, I wouldn’t say that it particularly matters,” Geidt said. “If we’re not there now, we’ll be there in a week.”
http://finance.yahoo.com/news/uber-blocked-brazil-california-hurdles-055604664.html
Plus, they are based in California. With a cool name like Austin, how can we stop this juggernaut?
seems like somebody doesn’t like competition. regulate them out of business?
I don’t get it. If I conspired to break laws around the world I’d have the feds kicking down my door in a heartbeat. But if you hire some connected DC guys, and do it on the internet, anything goes.
I guess you have to pay to play.
Uber has another billion dollars in angel funding. They can afford better lawyers than the government can. Doesn’t mean they won’t be corralled eventually - it took a long time to stop napster and pirate bay is only now being shut down.
I don’t believe there really is a new bubble inflating as most of you here think - however I do believe there is a specialized bubble in the “sharing economy” When that bubble bursts there will also be unwinding of real estate and other collateral damage.
But if Uber can do it, why not anybody with a car?
look in cragslist- they already are
uber is worthless as under dereg you can get a ride EVEN CHEAPER !
I have used Uber a lot….I think its a wonderful service…Quick & inexpensive….
I’m all for opening up the taxi market. I want in, too. I’ll call it Benbur. No, that sounds too much like Justin’s nickname.
Seriously, the reason it’s cheaper is they don’t have to pay for all the stuff taxi’s do. And that’s illegal. I want to build houses too. I’m not a general contractor, but hey, this is the new economy! There’s a contradiction here that’s a little hard to ignore.
the reason it’s cheaper is they don’t have to pay for all the stuff taxi’s do ??
Well, I got to believe the difference in service & cost go far beyond the cost of insurance…
Speaking only from my perspective, Taxi service is slow, expensive and the worst of it, typically smelly & dirty…
As far as insurance, can’t we leave that decision up to the consumer…Please government, I don’t want your protection in this decision…
I use to put my thumb out for a free ride when I was a youngster…If there is someone out there in a fresh clean prius that wants to give me a ride for $6.00 with no tip and arrive at my calling within a few minutes I really don’t care if they have insurance to give me a ride…Thats a service I need & want…
Don’t get me wrong. I think taxi’s are a rip off. But why? And if the big idea here is to jump into a business and ignore the laws, I’d say the mafia had that business plan a long time ago.
I don’t get it. If I conspired to break laws around the world I’d have the feds kicking down my door in a heartbeat.
I just took the anticorruption class at work, where it was hammered into us that we have to obey all local laws when doing business around the world.
The argument that I heard from the AirBNB CEO was that the current laws didn’t contemplate their technology (what they are doing isn’t really breaking the laws because the regulations didn’t contemplate their business).
And so, while they are operating in what they consider a gray area, they are having open dialogue with various Cities in order to make their operations clearly legal.
As an example, they made a deal with Portland to make short term rentals legal (within certain parameters). And what they have said is that they are willing to work with any and all municipalities to make sure they are clearly operating within the law.
However, my understanding is that Uber’s operation seem to be operating in a part of the law that is a darker shade of gray, and they are taking a much different approach in order to gain market share in front of their competitors.
More of an “f-u, sue us” approach, and fighting the legal fires as they occur.
I think the issue with taxis/Uber is as follows:
1. Taxis are given the right to pick up strangers off the street who wave them down, but have to pay for that right by buying a medallion. Towncars could operate alongside taxis because they weren’t picking up strangers on the curb, they were being called in advance.
2. The argument for Uber is that they operate like Towncars–people calling in advance for the pick-up.
The problem for taxis/towncars is that Uber is so much more convenient than finding a towncar service and calling them, and arranging them to pick you up, etc., and convenient/clean/cheap relative to taxis, since the Uber drivers don’t need to buy a medallion, and you have perfect visibility into where your ride is before they pick you up.
Uber is flat out black market. They can never do an IPO so this makes them basically fraudsters for the angel funds until they collapse.
Hey, I agree, I like cheap and efficient, but the first few accidents and it is all over. I used to deliver pizzas for a Dominos back in the days of 30 min delivery or free. It was a great deal. But no driver ever told his insurance company he was using the car for commercial purposes. If they had they wouldn’t have been able to continue to make money.
“They can never do an IPO”
Really?
Alibaba just went public in the US, and China explicitly prohibits foreign ownership of Alibaba. With a crazy legal structure, people still bought it, and US regulators didn’t stop it.
Uber will be a public company. The question is simply when.
only gov workers will get their pensions ??
Good point….Which prompts the Q; Why Not ??
Nice find Ben…See how they bury this type of legislation in a spending bill…They don’t have the “nuts” to bring it out in the open public because they know they could not get it passed…With that said, I do think it appropriate legislation…
This might be mildly deflationary ??
I will definitely if it goes systemic….Think Illinois as just one example….
‘In a personal finance survey published today, 18 percent of the respondents said they expect to be in debt for the rest of their lives. That is double the percentage who expected that in May 2013, the last time the survey was conducted.’
“We’ve all seen the student loan debt numbers, and credit card debt is increasing, and even though the job market is improving it’s certainly not humming along, and there is data about people’s salaries not growing quite as quickly as people had hoped,” said Schulz. “You just wonder if it has all come together to create this unease.”
http://finance.yahoo.com/news/one-fifth-americans-dont-plan-050200374.html
Never gonna happen here in ILLANNOY - the Mad Again cabal will never allow that cash cow to get milked the wrong way!!!
Here ya go on ILLANNOY!!
http://www.illinoispolicy.org/the-cost-of-illinois-broken-pension-systems-per-employee-retirement-contributions-4-times-the-private-sector/
That’s a really good question, I’ve been thinking of posting the question for a while myself but haven’t. Isn’t the problem with oil futures that (if you’re a primary buyer, at least) you ultimately have to take delivery? That wouldn’t suit the Fed’s style of monetizing by burying junk paper and holding it on their books forever.
That would be the goldman sachs program called Tankers at Anchor.
Do you guys think uncle fed should start buying oil futures to save GDP?”
A-Dan speculates they are selling oil futures to punish Russia.
BTW who is going to save Tesla and the Reno battery Factory ? Cheap oil will wipe out all this green technology just like last time.
I actually think the government is too lame to cause this oil plunge. Investment Banks are selling after years of using free money to drive the price of commodities up. They must have changed their minds. look out below
“Brent crude fell, trading near a five-year low as an Iranian official predicted a further decline in prices if solidarity among OPEC members falters. West Texas Intermediate also sank.
Futures slid as much as 1.9 percent in London. Crude could fall to as low as $40 a barrel amid a price war or if divisions emerge in the Organization of Petroleum Exporting Countries, said an official at Iran’s oil ministry. The U.S. Energy Information Administration reduced its price forecasts for next year while also downgrading its production outlook for a second month. U.S. output is at a three-decade high.
Ask yourself where spectacular increases in demand were expected. That is where demand is falling off a cliff.
Don’t assume conspiracy where stupidity is a perfect explanation.
whatever the reason for oils fall the effects are spreading out all over the place.
MEXICO CITY (AP) — Mexico is ready to intervene in currency markets to fight the peso’s fall against the dollar amid concerns over dropping oil prices and a possible increase in U.S. interest rates.
“The fall in the price of oil affects investment decisions,” he said. One-third of Mexico’s revenue comes from oil and the country recently passed historic energy reforms aimed at attracting private investment that could revive the country’s declining production. But as oil prices fall, Coutino said, “Mexico isn’t as attractive and that could affect big companies’ investment decisions in 2015 and 2016.”
did the taxpayers pay?
Almario who lost a previous home to the mortgage meltdown a few years ago.
it was just added to the tab. a tab that will never be paid off. Its just a matter of keeping the tab serviceable.
That Columbus Dispatch article should be really interesting to regulars here. That’s exactly the type of thing that should have been happening everywhere for the past 7-8 years.
Of course any such initiative would be massively deflationary to housing prices. Nice to see someone showing the terrible costs of not letting situations correct on their own in that manner.
‘We already got about $75,000 in equity after a year when we bought it,’ Almario said. It’s a great gain for Almario who lost a previous home to the mortgage meltdown a few years ago. ‘This will be another income for me and my family and my future and my kids and grandkids to pass along,’ Almario said.”
Hahahahahahahahahahahahahaahhahhahhhhhaaaaa! OH, my, eyes are tearing up so bad from laughter I can’t see the screen anymore!!
I never realized you could be reincarnated into ANOTHER sucker.
oil use to drop 1-2% ? and price drops 30% ?
wow, markets move at the margins
is the something bigger going on here?
A lot of people here seem to know what’s behind it all. I don’t remember any of them predicting this crash though…
BAAAAAhhh 10-4
it seems like there’s a big show to drop
a really big shoe
Burst of oil when prices were high eventually showed that the emporer had no clothes and caused the crash.
But depletion rates of the new fracked oil is rapid (meaning that the flow of oil shrinks quickly without continued drilling/fracking).
In other words, cheap oil is not the new world order.
No, but enough junk debt might explode in the mean time to make things rather interesting…
why not embrace deflation
1921 the cpi fell 10.7%
do nothing and we had the biggest boom ever !
It could happen again! Alas a bunch of TBTF bankers and assorted debt donkeys might not fare so well in the short term. We must look out for them.
Why not just let deflation run its course? Given the TBTF bankers and other debt donkeys a bone to prevent them from starving, but also let them enjoy their well-deserved losses.
Asia 1998
do nothing and grow like mad
or be the EU w no growth EVER !
does Zillow have grand junction appreciating in 2015 ?