It Couldn’t Last, And It Didn’t
It’s Friday desk clearing time for this blogger. “Short supply has been underpinning skyrocketing resale prices in both Collier and Lee counties, Naples real estate economic adviser Michael Timmerman told a group of about 50 builders and developers. The biggest surge in new home starts seems to have abated in Collier County. ‘Starts are getting ahead of household formations in Collier County,’ he said. Maureen McAvey, an executive vice president with ULI in Washington, D.C., warned that even though builder optimism is at levels that have not been seen since the housing boom, ‘black swans,’ like a stock market correction or an overseas shock, could have a negative impact in the future.”
“Timmerman agreed, saying that the 10 to 12 percent price increases Southwest Florida has been experiencing the past few years is not sustainable. ‘We’re six years into a seven-to-eight-year expanding cycle,’ he said. ‘I’m not saying we should run for the hills, but we’re due for a healthy correction.’”
“The storm clouds are gathering even as deals chug along. One major investment broker, on condition of anonymity, confided, ‘I’m telling clients — and not making public — that we think we are past the peak and they should get realistic and drop the price, take the bid and move on.’ Manhattan is still strong, our source noted, but secondary and tertiary markets and projects are taking the hit. Cap rates, which are indicative of the going-in return on investment, had been plunging, but are just starting to rise again as some prices fall.”
“There are thousands of pricey, available residential condo units, and he pointed to Gary Barnett’s decision to market a group of rental units at One57 through Eastdil Secured at a large discount as a move that will send shivers through the market. ‘If one developer does it, will others?’ he wondered.”
“Houston-area home sales tumbled 10 percent in October, leading to the worst decline in more than four years as the city’s slowing economy reverberates across the real estate market. The sharp drop, the first double-digit plunge since spring 2011, played out among all price ranges, the Houston Association of Realtors said. The softening sales remind Realtor Sissy Lappin of tougher times in 2008, when the national economy was trying to pull out of a major recession. ‘We call this the unspoken recession. Nobody wants to talk about it,’ she said. ‘Nobody wants to use the ‘R’ word.’”
“Kelly Carter listed her five-bedroom house in Woodforest in May, and she’s had fewer than 10 showings. She thinks part of the reason it’s been slow is because she’s competing with new construction in the area. She doesn’t want to drop her price because she put in a $100,000 pool and spent at least another $10,000 on window treatments, shutters and automated blinds. She is, however, considering renting the house. Carter also owns a house in The Woodlands that she’s been renting since she and her family moved out a couple of years ago.”
“At that time, she said, ‘I could have sold in a day. It was tougher to find a renter than a buyer at that time. Now it’s kind of flip-flopped.’”
“Newly started foreclosures rose 12 percent in October from September, according to a new report from RealtyTrac. That is the largest monthly increase since August 2011, and more than twice the gain from September to October in the last five years. More than half (57 percent) of new foreclosures in August were re-defaults, according to Black Knight Financial Services, the largest share of repeat foreclosures on record. That is likely continuing into October’s numbers.”
“‘A representative of one of the major banks told me that many of the properties they are taking back are highly distressed in terms of condition and in neighborhoods with virtually no buyers, so they are having trouble even giving some of those properties away to land banks etc.,’ said RealtyTrac’s Daren Blomquist.”
“While scandals such as the one at Home Capital occasionally shed light on the dark side of Canada’s $1.3-trillion mortgage industry, much of the problem of mortgage fraud remains hidden from public view. ‘It’s happening on such a level that the consumer is aware that this is something that can be done,’ says an Ontario mortgage broker who didn’t want his name used and who once complained to federal and provincial regulators after being referred a deal that involved a family looking to buy three homes without any reportable income. ‘It’s happening on such a level that some bank reps, mobile mortgage reps, have said: Call a mortgage broker, they can probably find a way to make your income higher.’”
“Home buyers in Rio de Janeiro used to get into intense bidding wars as they tried to secure even a modest apartment in one of the city’s exclusive beachfront districts. Not anymore. Developers in Brazil’s second-largest city are now scrambling for ways to unload apartments, offering enticements like paying maintenance fees for years, slashing payments by 50 percent and giving away trips to New York. ‘This was supposed to be Rio’s moment of splendor on the global stage,’ said Rubem Vasconcelos, the president of Patrimóvel, one of the city’s largest real estate agencies. ‘Instead, properties are going for the price of a banana.’”
“High value homes in the north east of Scotland are proving harder to shift with an increasing number coming on the market at lower prices than before, according to property experts. Monthly rental of a typical four-bedroom family home in Aberdeen has dropped nearly 20% in the past 12 months. The price of an average detached home has fallen 1.7% in the same period. ‘We have certainly seen an increase of top end properties on the market. You just need to drive round to see the ‘to let’ and ‘for sale’ signs all over the west end of Aberdeen,’ said Adrian Sangster, national leasing director at city law firm Aberdein Considine. ‘Aberdeen has lived in its own little bubble the past few years.”
“Mary Smith, managing director of Relocation Scotland in Aberdeen, works with many of the oil majors and big service companies in the city. She said the market was experiencing a ‘correction.’ ‘But it needed a correction, last year before the slump was crazy and the market was overheating. I think a lot of buy-to-let speculators who mortgaged to acquire property are finding it tough. They need to get rental income in and there just aren’t the people there anymore.’”
“China’s economic troubles have dropped on the doorstep of a sun-weathered house at 18 Edgar St. in Port Hedland on Australia’s northwest coast. Four years ago, the 50-year-old home, fabricated from cheap asbestos cement, sold for the equivalent of $1.3 million. It’s now for sale again - recently priced at $310,000. What happened to $1 million in home equity? It vanished down the China sinkhole. It couldn’t last, and it didn’t. John Briggs of Port Hedland’s Pilbara Heart Real Estate says he’s never seen a bust like this: ‘It’s been dramatic, mate. Absolutely dramatic.’”
“From Australia to Zambia, Chile to Indonesia, the pain of China’s sharp economic slowdown is being felt in the form of depressed commodity prices, elevated unemployment and shrunken home prices. Chileans are suffering. The mines are retrenching. ‘They cut the workforce in half due to the lower prices of copper and less demand because China is no longer buying,’ said Juana Mejias, who heads the mine’s local union. ‘Things are looking bad here in Chile.’”
“Glencore, an Anglo-Swiss commodities company and one of Zambia’s biggest employers, is cutting 4,000 jobs at the Mopani Copper Mine. The Konkola Copper Mine has laid off 150 and is expected to cut more. The Chinese-owned company CNMC Limited has suspended operations at the Baluba mine in Luanshya, laying off 1,600. Spokesman Sydney Chileya blamed plummeting copper prices. Adam Zulu of the National Union of Miners and Allied Workers says closing the mine ‘will bring untold misery to this town.’ ‘If the mine is not running,’ Zulu said, ‘this town is going to die just like a ghost town.’”
“Abandoned stucco and fibreglass unfinished housing decorations litter Xuefu Hany’s workshop in Qiqihar, a second-tier city in north-east China’s Heilongjiang province. Further down the road from the workshop, other plants and ateliers have completely closed, leaving behind unsold window panes and mounds of coal. ‘Difficulties began a few years ago,’ says Guo Taixi, one of the managers of Xuefu Hany. ‘Before, there were queues of people wanting to buy apartments. This is no longer the case.’”
“On the outskirts of the town today, 40 or so cranes still continue to dig and build what will be yet another ‘new town.’ Several real estate projects are planned as well as schools, a sport stadium, lakes and parks. For the moment, most of the buildings remain empty. ‘It’s nothing but a bubble to create economic activity,’ says Mr Guo. Several people interviewed in Qiqihar are convinced no-one would move in. The city lost 180,000 people last year, and recent research published by Tsinghua University said that two million people leave the region every year as qualified workers and young people look for work further south.”
“‘We did not know how to adapt to the new growth model,’ says a retired agricultural worker who wanted to be known only as Feng, 80. All of his four children have left the city. His daughter is running a taxi company in Xiamen. ‘There is no work in the factories anymore,’ he says.”
‘Office-tower owners in Canada’s energy hub are about to feel the full force of the oil-price crash. Vacancy is already at a five-year high in Calgary and rents are the lowest since 2006 after thousands of office jobs were cut. Energy company tenants have now begun to ask for rental relief and are offering subleases for as little as half the going rate, according to real estate brokers including Jones Lang LaSalle Inc. and Avison Young Canada Inc.’
‘That’s before five new office towers with about 3.8 million square feet (353,031 square meters) of space hits the market in the next three years.’
“It is a bloodbath,” said Alexi Olcheski, an office-leasing principal at Avison Young from his office in downtown Calgary. “We’re at the highest point of fear and uncertainty now.”
“We’re at the highest point of fear and uncertainty now.”
I’m certain you’re not. You will be much more fearful and uncertain next year, then the year after that, etc., etc., etc…….thru about 2019.
Professor Bear, how does that cycle go again?
I am soooooo glad that I bought my house for cash in a huge environment of fear here in the Midwest in 2008. I paid less than $20/sf. Yes, that’s not missing a zero, that’s TWENTY. And so I’ve enjoyed not paying a landlord or banker for 7 years. And I needed that break, since the economy truly sh!t the bed there around that time, and it never recovered.
An environment of fear is useful for those who keep their tinder dry. I’d prefer people acted rationally and guardedly all the time, but that’s far too much to ask since promoting asset bubbles is a government priority. I’m having to spend my life trying to weather each asset bubble as it arises.
That’s about what a used house is worth. $20/sq ft.
‘A plethora of unsold condominiums is cause for concern for the health of Ottawa’s housing market, especially since more units are set to flood the market in coming months, the Canada Mortgage and Housing Corp. warned. “We see a lot of oncoming supply and active listings at the moment,” Shaker said at CMHC’s annual Ottawa Housing Market Outlook conference. “Listings continue to go up and sales have plateaued. Condominiums alone are on the edge of being a buyers’ market.”
‘That’s bad news for existing condo owners because it could bring further price drops in a market that has already seen three years of decreases…The housing agency suggests that builders have misread the market and overbuilt condominium units, but also that first-time buyers, a key market for condominium sales, are increasingly opting to delay their purchases or to buy residential houses.’
‘According to CMHC, the Ottawa market is now being fuelled by repeat buyers who prefer residential properties, and in particular single detached homes.’
‘Recent data provided by Statistics Canada show that first-time home buyers, typically in the 25 through 44 age group, are still struggling to find employment and aren’t as interested in condominiums, especially once maintenance fees are added to the mortgage and carrying costs of the unit, Shaker said.’
‘builders have misread the market and overbuilt condominium units…buyers prefer single detached homes’
Imagine that.
‘Comment by RioAmericanInBrasil 2015-11-12 17:32:14
I’m a gringo, ask them. But I’m totally stoked “those guys” got the Olympics. Rio has already improved dramatically…And I lost nothing on my house in Brazil. It paid for its construction on “free rent” over a year ago. When I sell it, I’ll get bank. (In any language and any market, do the math, it’s paid for.)’
‘This was supposed to be Rio’s moment of splendor on the global stage,’ said Rubem Vasconcelos, the president of Patrimóvel, one of the city’s largest real estate agencies. ‘Instead, properties are going for the price of a banana.’
I can get 6 banana’s for 59 cents.
You know, I was looking at Rio’s comment from yesterday, getting ready to have a good laugh at his stupidity. But after looking back at it, he’s always mad Bahh!” What do you add? You have this huge bubble bursting, and you are in Brazil, what have you told us about it? Oh you’ll go on and on about all sorts of bull crap, lecturing, lecturing, but oblivious to the purpose of this blog.
I think I’ll start trimming the bushes comment/poster wise.
from the article,
“Scholars of sports history often expect such economic downturns to materialize after the Olympics, when spending on construction dries up and the flood of tourists subsides…But Rio is adding a new twist to this model as the economy here sharply deteriorates in the months ahead of the Games”
Looks like it will be a double gainer dive after the Olympics.
Ironically, 6 bananas cost more like $1US in Brazil.
http://www.brazil-help.com/what_things_cost_in_brazil.htm#fruit
Yes I’d like to hear about how much the value of the house is down in the last year. A very simple fact to report.
I like Rio’s comments. His remark about his real estate triumph was premature, but I enjoy reading the perspective of someone else who is a gringo living in Latin America. For that matter, I also appreciate AlbuquerqueDan, who hasn’t been heard here for awhile, even though I disagree with Dan on many points.
When I read that line about apartments selling “for the price of a banana” I almost laughed out loud. Makes me wonder about my old barrio in Panama City. From pictures, it now looks like Dubai, which is not a good thing.
I also appreciate AlbuquerqueDan ??
I enjoyed reading his comments…I guess his law degree did not allow his ego to come back here and eat the crow that he rightfully deserved…
A little bit of disagreement makes for a livelier blog.
I agree…
I think you’re missing an opportunity, snake. You’d make a great consultant to potential US expats wanting to move to Colombia. What’s not to like? Great weather, a choice of mountains or shore, the best coffee and a highly intelligent, attractive population.
The Secret Service loves it.
http://abcnews.go.com/US/wireStory/sexting-arrest-latest-embarrassment-secret-service-35173092
I like Rio’s comments. His remark about his real estate triumph was premature,
Thank you. I was just livin’ in the reality as I am now. I didn’t make the reality I just reported what was happening. And I did acknowledge Rio de Janeiro’s being in a bubble in 2012 on this blog and in 2009 said on the HBB that prices can go down when the Brazilian economy weakens.
And here we are.
that line about apartments selling “for the price of a banana”
“Banana” It is a common expression in Brazil because of the commonality of bananas. Like if someone gets a cheap gift they tell their friends they got “a banana“.
Now I’ve always said Rio’s bubble “was different” in that mortgage debt in Brazil is about 7% of GDP compared to USA’s 70%. Another difference is turnover. It’s way lower in general but where I live it’s almost none. I live in a villa (cul de sac with homes between the mountains and high rises) with about 20 homes. In 7 years, I’ve seen one house change hands. In the USA FWIU the average time in a house is 12 years.
Question: If the turnover rate were the same in my villa of 20 houses as it is in the USA, how many houses would have been sold in this villa the past 7 years? And in your opinion, does an extremely low turnover rate in an unusual and desirable niche market in one of the top 5 neighborhoods in Rio shelter one from a lot of the worst of a downturn?
Many gyrations. How much is your house down?
You have this huge bubble bursting, and you are in Brazil, what have you told us about it?
That article references mainly overbuilt neighborhoods in the middle of nowhere that are about an hour away from the city center with good traffic - with a lot of open land around it. I live in Zona Sul-Ipanema/Copacabana/Leblon. There are no gluts of apartments on the market here. Yet?
Everyone knew Brazil was due for a recession. This one will be serious. But that’s the benefit of having a paid off house no? Everyone says houses are to live in and not an investment.
I’m looking at Rio prices are down .3% on the year. I predict they will end up 35% from the peak in a few years. Source: Zap dot com dot br
. I predict (Rio Prices) will end up (down) 35% from the peak in a few years.
What you guys are missing is there are way more important things going on in Brazil than recession and housing prices. There might be something akin to a constitutional crisis brewing quickly.
The government right now is NOT functioning. FWIU the guy that could start the impeachment process on the corrupt president is under investigation for corruption and has cut a deal that he won’t impeach the president if the president’s party doesn’t investigate him.
Nice huh? And I’m supposed to be worried about home prices? Granted, I’m sure that I really would if it wasn’t paid for.
You babble and gyrate too much Lola
“The guy that could start the impeachment process on the corrupt president is under investigation for corruption and has cut a deal that he won’t impeach the president if the president’s party doesn’t investigate him.”
______________________/
Now that’s funny, in a black humor sense of course. That sounds like pure Latin America. I read the newspaper every day when in Colombia and regularly am stunned at the ironies, randomness, and basic human weaknesses that seem to drive events in that part of the world, at least as much as any virtue or principle. My in-laws usually just shrug.
“What you guys are missing is there are way more important things going on in Brazil than recession and housing prices. There might be something akin to a constitutional crisis brewing quickly…And I’m supposed to be worried about home prices?”
It’s all connected. Housing prices, corruption, and the recession. You post on this blog constantly, yet seem to understand not one bit of what’s going on.
“Constitutional crisis”? LOL! It’s just good old-fashioned political-economic corruption, which is Brazil’s primary commodity.
It’s all connected. Housing prices, corruption, and the recession.
It is not “all connected”. How is Brazilian’s centuries tradition of corruption connected to the commodity bust due to the China slowing?
yet seem to understand not one bit of what’s going on. “Constitutional crisis”? LOL!
I totally understand it and understand the definitions of the terms I use. Of course it’s a constitutional crisis. A corrupt legislative body unable to impeach the corrupt president because they cut a deal is the exact definition of a Constitutional Crisis.
“A constitutional crisis is a situation that a legal system’s constitution or other basic principles of operation appear unable to resolve; it often results in a breakdown in the orderly operation of government.”
wiki
Newspapers are reporting that “extra-constitutional” remedies are being discussed. Why would “extra-constitutional” remedies be discussed if the constitution could resolve the issues? Check out the definition then please explain to me why this is not a Constitutional crisis.
Extra-constitutional: not authorized by or based on a constitution; beyond the provisions of a constitution. Examples from the Web for extraconstitutional Expand. By creating an extra-constitutional authority, it would delegitimize Parliament, they say.
dictionary dot reference dot com
No Lola. It’s all corrupted.
See the link below. On the subject of “extra-constitutional remedies,” is there any possibility of military intervention? The last military government there ended only 30 years ago. I’ve been expecting military dictatorship to come back into vogue somewhere, although I thought it would happen in Greece.
According to Wikipedia, back in the early 1960s, one pre-coup president used a broom as his campaign symbol, promising to “sweep away the corruption.”
http://tinyurl.com/npmp6yj
On the subject of “extra-constitutional remedies,” is there any possibility of military intervention?
Very slim at this point imo. The military doesn’t want anything to do with running the government today. They’re just now recovering from the stain of the past. FWIU, The small far right-wing fringe is for it but compared to USA’s they are tiny and ineffectual.
“Wagner, the defense minister, said requests for a military intervention had “near zero” support among troops. He called such a request an “affront to democracy”
“It’s not ‘all connected’. How is Brazilian’s centuries tradition of corruption connected to the commodity bust due to the China slowing?”
I’ll answer your question with a question:
How did Brazil’s centuries-long tradition of corruption not lead to a housing bubble until recent decades?
It is ALL connected, and China is only one piece of it.
Money printing by central banks the world over, crony capitalism and corruption (all three of these are aspects of the same thing), real estate fraud, money laundering, the China “miracle”, the Brazil “miracle”, inflated commodities prices, inflated housing and real estate prices, immigration, etc. etc.
How did Brazil’s centuries-long tradition of corruption not lead to a housing bubble until recent decades?
Because of lack of massive global credit bubbles. Brazilian political corruption did not cause massive global credit bubbles - or any mortgage bubble in Brazil. Brazilian political corruption did not lead to Brazil’s housing bubble in any meaningful manner that I’m reading. Consumer loans yes, Housing? I’m not reading much of that at all. I never heard of any easy money, no down, home equity, liar loans here. One possible measurable corruption relating to housing in Brazil was to subsidize building more houses for the poor at builder’s prices. More supply would tend to mitigate a bubble.
Of course the Credit bubble affected Brazil tremendously but most all the stories here dealing with political corruption talk of corrupt money channeled into crony capitalist speculation in petroleum and unionized heavy industry - not housing. (So far)
As far as “everything being connected”, I guess if one looks hard enough, everything is connected to everything.
This can’t be good for real estate imo.
Brazil’s Massive Corruption Scandal Is Rocking Its Once-Superstar Economy
http://www.bloomberg.com/news/articles/2015-05-19/brazil-s-massive-corruption-scandal-is-rocking-its-once-superstar-economy
Some Brazilians worry that the biggest corruption scandal in their nation’s history will end in what is known in their country as a pizza party, meaning the accused will find a way to get away with it. While their fate remains to be seen, both the economy and society have been rattled.
……….3. Empty offices
The drawdown in work for Petrobras — an engine of activity in Rio de Janeiro, where it’s based — has contributed to a decline in absorption of Class A office space, according to Thierry Botto, director of office transactions for Rio at commercial real estate broker Cushman & Wakefield. The scandal, along with the tumble in international commodity prices and the broader economic slump, has brought Rio’s vacancy rate to its highest in at least a decade.
Karen
They’re most certainly not all “connected.” Briefly…..
What do you mean by connected? Are you seeing a correlation or a causation? You have attributed money printing as the root of all our evil doings. Do you think the banks in Bogota “run” on the same juice as those in Manhattan? Do you know why people do NOT keep their money in Bogota banks? Do you understand the function of cattle? Do you own one finca or five? Which is safer?
And China:
Do you understand what the commodity “pits” did to China? to JPMorgan’s silver position? There was no political allegiance here. It goes back to colonial trading posts. Mercenary and profitable.
Yadayadayada. It’s the blank backside of a Contract that holds the truth, not the front-side. (Where is Volcker working?)
awesome stuff, Ben. Just been reading through a bunch of your posts.
And I just did a blog post titled “7 signs that the Canadian Housing Market has gone Bananas”.
I think you’ll like it. It’s a pretty simple litmus test to know that, yeah, these prices are hard to justify.
https://carpentryoftheheart.wordpress.com/2016/02/12/7-signs-that-the-canadian-housing-market-has-gone-bananas/
Those are damning articles.
The DingBat maneuvers like spending $100k on a $12k swimming pool is classic. Bringing it to the height of DingBattery is the fact she’s on the hook for another shack just down the road. Two massive mortgage payments on depreciating assets, subsequently throw more good money after bad in an effort to correct the first mistake, then dig in your heels when you want to exit. Classic.
I’m going to say this again in cap’s:
WHEN THE HISTORY OF THIS EVENT IS WRITTEN, THE MOST IMPORTANT DECISIONS ARE GOING TO HAVE HAPPENED AFTER 2008.
Remember when the Chinese poured more concrete in 3 years than the US did in a century? How much iron and steel was involved? All the gasoline used to deliver the materials and workers. They pulled forward commodity prices for decades.
‘John Briggs of Port Hedland’s Pilbara Heart Real Estate says he’s never seen a bust like this: ‘It’s been dramatic, mate. Absolutely dramatic.’
‘From Australia to Zambia, Chile to Indonesia, the pain of China’s sharp economic slowdown is being felt in the form of depressed commodity prices, elevated unemployment and shrunken home prices. Chileans are suffering. The mines are retrenching. ‘They cut the workforce in half due to the lower prices of copper and less demand because China is no longer buying,’ said Juana Mejias, who heads the mine’s local union. ‘Things are looking bad here in Chile.’
‘Glencore, an Anglo-Swiss commodities company and one of Zambia’s biggest employers, is cutting 4,000 jobs at the Mopani Copper Mine. The Konkola Copper Mine has laid off 150 and is expected to cut more. The Chinese-owned company CNMC Limited has suspended operations at the Baluba mine in Luanshya, laying off 1,600. Spokesman Sydney Chileya blamed plummeting copper prices. Adam Zulu of the National Union of Miners and Allied Workers says closing the mine ‘will bring untold misery to this town.’ ‘If the mine is not running,’ Zulu said, ‘this town is going to die just like a ghost town.’
‘We call this the unspoken recession. Nobody wants to talk about it,’ she said. ‘Nobody wants to use the ‘R’ word.’
I’m not happy about this state of affairs. I have family that will be affected. But I did say all along that using a whole bunch of printed money and debt in answer to a problem caused by printed money and debt was a bad idea.
“But I did say all along that using a whole bunch of printed money and debt in answer to a problem caused by printed money and debt was a bad idea.”
The hefty prices supported the debt but now the hefty prices have disappeared the debt looks sort of … stranded.
Stranded in the sense that there is no backing of hefty prices to justify all the debt.
So … now what? From what I can see the price decline immediately destroyed the wealth of one group of investors - the stockholders - and the next group of investors that will have their wealth destroyed will be the debt holders.
Stay tuned.
The general price declines have only just begun.
I thought another lesson of 2008 was that bondholders can never have their wealth destroyed.
‘The proposed 28,000-home Villages at Vigneto development will transform depressed economies of Benson and Cochise County, “spurring unprecedented economic activity, business development and population growth,” says a new analysis done for the project’s developer.’
‘The report’s overall predictions of economic transformation from the project also rest on several other positive assumptions. One is that it can sell almost as many new homes per year over a decade than were granted permits in Tucson at the peak of the last decade’s real estate boom. Another is that the project’s homebuilders will sell new homes for an average of $250,000, more than twice Benson’s median home price, and that a typical Vigneto family will earn $65,000 annually, well over Cochise County’s $45,700 median 2014 household income.’
‘Alberta Charney, a University of Arizona economist, said a retirement community can be considered to be part of a larger community’s economic base, as Vigneto is envisioned. But that can bring a lot of negatives 20 years down the road, she said, when younger retirees age, become ill, use up their retirement income cushion and become dependent on the state.’
“I’m not a big fan of trying to get retirees to Arizona,” said Charney, who hasn’t reviewed Carreira’s new report.’
‘Carreira, however, said the Vigneto project is more likely to attract more-affluent buyers than the typical retirees. “I would imagine the wealth effect there would more than offset” any economic problems suffered by the project’s retirees as they age, he said.’
‘Patten, a recently retired Sierra Vista Realtor, is dubious Vigneto would succeed in that atmosphere. He noted that the much larger cities of Sierra Vista and Tucson issued permits to 577 and 2,360 new single-family homes in the boom year of 2005.’
“I’m hard-pressed to figure out where they’re coming up with 28,000 homes over a 20-year period,” said Patten, who retired in January after 20 years as a Realtor, most recently in commercial real estate.’
‘Carreira said that if you look at the region’s historic new-construction rates, “They would tell you there’s no way they could sell 2,000 homes a year in Benson or in Cochise County.”
From the article:
“Carreira’s report is based on economic assumptions provided by the developer, including some that would buck recent trends in the area.”
Yeah. Check out these assumptions:
——————
9,460 construction and other jobs
4.4 million square feet worth of office, retail, industrial, golf, a resort and other forms of nonresidential development.
Vigneto’s tax revenues paid to Benson city coffers of $557 million over 18 years will exceed … the costs the city will pay to provide police, fire, library and other public services to the project, says Carreira, president and chief economist of UsEconomicResearch.com and the soon-to-be retired director of Cochise College’s Center for Economic Research.
a planned Benson Community Facilities District will raise enough revenue from the development’s homeowners and other landowners to cover all the costs of providing roads, water lines, parks and other infrastructure to the 12,000-acre project… $50,000 worth of infrastructure per home.
Another [assumption] is that the project’s homebuilders will sell new homes for an average of $250,000, more than twice Benson’s median home price, and that a typical Vigneto family will earn $65,000 annually, well over Cochise County’s $45,700 median 2014 household income.
The Army Corps of Engineers is being asked by environmentalists to reconsider or revoke a federal Clean Water Act permit it gave an earlier version of this project back in 2006.
Carreira said that if you look at the region’s historic new-construction rates, “They would tell you there’s no way they could sell 2,000 homes a year in Benson or in Cochise County.”But on the developer’s side, he said, is that projects of this kind have succeeded when marketed internationally.
———————-
In other words, this is preposterous on every level.
The developer bought off some third-rate econ prof at some third-tier school to write a report saying exactly what they want him to say (and then the prof will retire with nice little reward).
The town was duped into providing ALL the infrastructure up front by raising taxes on the people buying the houses.
They are depending on a 10-year-old housing-boom era Army Corp permit to pump the San Pedro River dry, for the golf course.
They assume that retirees will make $65K.
They also assume that someone making $65K can afford a $250K house.
They are banking on marketing “internationally” probably to Canadians.
And the local governments fell for this nonsense.
Did IQ’s just drop sharply out in the West? Any retiree successful enough to make $65K will also be sensible enough to avoid the place like the plague. And regardless of the financial idiocracy, who wants to live packed like sardines in a sandpile with 27999 other retirees? Oil City never looked so good.
Donk,
Keep in mind than subdivisions aren’t the model for SFR’s.
Well, it could certainly end up like the Villages in Central Florida. It did not exist 25 years ago and now has 100,000 residents. I certainly don’t get it. It is just a a huge subdivision surrounded by cheesy strip centers. Many of the houses go for north of $300 K.
It’s just sprawl,but the old Yankees just keep on coming.
It’s just sprawl,but the old Yankees just keep on coming ??
They are seeking Sun & Safety….
…and STD’s.
Brazil article: ‘Instead, properties are going for the price of a banana.’”
That’s all they’re worth before the fraud, that’s all they’re worth after the scheme comes apart.
Who wants to live in a third world slum?
Coral Springs, FL Housing Craters; Prices Plummet 21%
http://www.zillow.com/coral-springs-fl-33065/home-values/
zillow reporting in fl is wacked
2 counties away it’s up 2 more and it’s down
=shell game
ehhhhhh…. no.
Prices are falling all over FL. Look at MLS and see for yourself.
Zillow is a bit unreliable……
I have two houses in a Sacramento foothills subdivision which are the exact same model. Zillow says one is worth $391,366 and has dropped $11,647 in the last 30-days. It says the other is worth $419,540 and has increased in value $8,128 the last 30 days.
The exact same houses on the same block with Zillow valuation differentials of 9%! It is a goofy market and Zillow is unreliable, but I do believe prices in the Sierra Foothills are declining a little these day heading into the winter.
They sold for $662,000 each in 2005. I picked them up for an average price of of $337,000 in 2009.
… and you still overpaid a few hundred thousand each.
Zillow ask and transaction price data is directly from MLS. It’s quite accurate.
Zillow is nothing if not inaccurate. They couldn’t even get the price correct for their own CEO’s house, LOL!
http://seattlebubble.com/blog/2015/11/12/zillow-cant-even-get-the-listing-details-right-on-ceo-spencer-rascoffs-own-home/
When it comes to data, garbage in = garbage out.
All their transaction and asking prices are directly from MLS. Boots on the ground data my friend…. Boots on the ground data…. just like a movoto.
Take a look at Cape Coral on Google Earth. It is just another 1960’s giant Yankee-wealth transfer community. Most of the old houses are one story block on cookie-cutter lots that are maybe the ugliest in Florida.
It is just like Deltona, Palm Bay, and a dozen more “new” retirement towns developed in the slash & burn Sixties. Hideous towns with no downtown, no agriculture, nothing but little block crap-shacks.
Prices are falling Boca.
I was in Ft. Myers, FL a couple of years ago and went to LeHigh Acres just to see what it was all about. It was often mentioned on this blog in the bubble bust. You are absolutely correct Cracker Bob, what a mess. Grid line streets with block houses! No collector streets, no traffic signals (stop signs every other block), no commercial zoning, no downtown, no bike trails, no storm sewers. The epiphany for was was I became thankful for the city planning departments for the first time in my life. No one should have to live in the mess of some Florida communities. Fugly.
I’m not a fan of that area either, but in the 1960s, that’s what retirement was. You could be a blue-collar worker, and retire from somewhere up north with a pension, and buy a cheap concrete-block house on a canal, and a small boat, and not have to worry about winter or state income tax. Voila, paradise.
There actully was a time when people could get along without granite kitchen-tops.
‘Queensland’s mining down turn has opened the door for first home buyers, who are taking advantage of bargain prices. “Between 20-40 per cent of properties are being purchased as first homes by under 30-year-olds,” he said. This two storey, three bedroom home in Emerald is on the market for $145,000.’
‘But in reaction to the mining downturn, major banks now require a 20 to 30 per cent deposit for residential purchases in central Queensland. Mr Muldrew said the high deposit rates were one of the negatives for buyers, but it was older rentals hardest hit by the downturn.’
Oh the DOOM! The doom I tells ya. 20% down, it’s raining blood.
Wait, 20% of 145k is around 30k. They were paying 600-700k for these shacks a few years ago.
‘Rampant land speculation fuelled by an avalanche of offshore money has driven new condominium prices to the tipping point, a senior real estate analyst warns. “At a certain point buyers will just say ‘no,’” said Michael Ferreira, managing principal of Urban Analytics Inc., following his address last week to the Urban Development Institute, Pacific region.’
‘Ferreira said “an immense amount of offshore capital” flowing mostly from mainland China into multi-family land speculation has nearly doubled the price of land this year and could drive future condominium prices into the stratosphere.’
‘So far, buyers appear eager to pay what are already record prices, Ferreira told a lunch meeting packed with members of the development community. In 2015’s first nine months, 2,000 more new condominiums sold in Metro Vancouver than in the same period in 2014, a 20 per cent increase. The standing inventory of completed and unsold concrete condominiums has plunged to just 70 units, despite more than 2,500 being completed since January.’
‘According to the Colliers LandShare survey, land prices for potential highrise condominium sites in Vancouver’s downtown and west side were in the $175 to $200 per buildable square foot range at this time last year. Recent land prices are now being bid up to $300 and $400 per buildable square foot. Offshore land speculators have been outbidding local condo developers, Ferreira said, and the traditional pro-forma calculations no longer apply.’
“The new rule is there are no rules,” he said.’
“The new rule is there are no rules,” he said.’ ??
The Euphoria phase ?? It typically does not end well…
…does not end well.
We’ve been saying that about Vancouver for 25 years.
I also said that about Las Vegas and it finally tanked…….after 27 years….
Maybe you’re right: Time’s up!
“Monthly rental of a typical four-bedroom family home in Aberdeen has dropped nearly 20% in the past 12 months”
My cousins over there were sure the oil field would make Scotland rich, if they voted for independence. That was just a year ago.
if they voted for independence. That was just a year ago ??
I have a couple of close Scottish friends…They were pi$$ed that independence did not pass…Said that to many want to continue to suck on the tity of the Britain…
‘While renters in Calgary are seeing an increase availability, that competition is hurting sellers. CREB Chief Economist Ann-Marie Lurie said the real impact is happening in the market of apartment-style condos.’
“We saw it go down, that condo apartment, 0.8 per cent, but compared to last year, it’s almost four per cent lower than it was,” she said. “We see weaker demand in part because there’s more rental availability that limits that pressure for people to move into ownership, further to that, there’s a lot more new product that people can choose from.”
‘There is a division in the market however, between homes under $500,000 and those over $600,000. On the lower side, prices are relatively steady, but not on the higher one. “More balanced essentially than what we’re seeing in the higher price ranges,” Lurie said. “There’s a lot more inventory relative to the sales activity occurring in that $600,000-plus segment of the detached market.”
‘Overall, October sales in the city declined by 33 per cent year-over-year to 1,421 units, with year-to-date sales falling by more than 26 per cent, CREB said in a release, with president Corinne Lyall saying sellers and buyers have to have hard discussions about their objectives.’
’sellers and buyers have to have hard discussions about their objectives’
Well, somebody’s gonna get an ass-pounding. Is it going to be me or you? Hmmm.
‘If China’s old economy doesn’t find its footing, metals demand could take another hit, Goldman Sachs said. “Only a major pick-up in Chinese demand is likely to be sufficient to balance metals markets such as copper and aluminum,” Goldman said in a Thursday note. “This is because metals supply generally continues to grow, while Chinese demand is not, so demand has to work hard to catch up.”
‘Analysts have raised a slew of concerns about the Chinese economy as it transitions from a manufacturing base to services; The country is hooked on debt, the shadow banking sector has imploded, so-called “zombie” companies are yet to be weeded out, the property market sometimes shows signs of a bubble and major industries are slowing.’
“The lack of a significant pick-up in sequential activity in China’s ‘old economy’ since the collapse during the first quarter of 2015 is of increasing concern,” Goldman said. That’s despite China cutting interest rates six times in less than a year and taking other aggressive monetary easing measures.’
Old economy? You mean the one from six months ago? Has there ever been a time when we were expected to believe a billion people could just transform in months?
‘We did not know how to adapt to the new growth model,’ says Feng ‘There is no work in the factories anymore’
The titanic credit mania boom and bust will bring about “transformation” for an entire generation.
The titanic credit mania boom and bust will bring about “transformation” for an entire generation.
I think it has already transformed an entire generation. IMO the mania began right about 20 years ago today. (Friday the 13th no less.)
That’s when NorCalBayArea houses just began their crazytown rise. The rest of the country began a few years later.
They better transform their air pretty soon or they’re going to transform into worm food:
http://www.livescience.com/52753-air-pollution-effects.html
Ahh what the heck worms gotta eat:
http://www.rfa.org/english/news/china/china-plows-ahead-with-coal-plants-as-smog-envelopes-northern-cities-11132015135759.html
I read they are building power plants with no demand, so no worries…..they won’t fire them up!
‘In early January 2015, prospective investors and home buyers in Brampton received a serious warning about posters advertising “home equity mortgageloans” to those with “bad or good credit”. Second mortgages were on offer and the problem seemed serious and widespread enough for the Financial Services Commissioner of Ontario (FSCO) to issue a warning about this practice. Not only were these lenders not authorized to be in business, they charged usurious fees and interest rates to their customers.’
‘Nothing changed because private lenders are still posting their offers with impunity and from all accounts, the second and third mortgage business is booming.’
‘No one it seems wants to rock Canada’s over-valued real estate market, even though even top brokers and real estate agents have privately admitted being apprehensive about the possibility of a real estate crash or atleast the impact of a slowdown. And yes, they also believe real estate in the GTA is over-valued by 30 percent.’
‘But despite all these reports and fears, a steady stream of media reports designed to assuage any doubts about real estate as an investment has worked. In August the head honcho of Genworth, the leading private insurer of residential mortgages went on record to declare that mortgage fraud was in decline in Canada, thanks to tougher regulations, better training and new technology.’
‘But then this weekend the headline How mortgage fraud is thriving in Canada’s hot housing market in the Globe and Mail made for riveting reading. The indepth piece indicates that banks have lost millions because of mortgage fraud, this despite to so-called tougher regulations.’
‘There are dozens of sketchy mortgage brokers from coast to coast who specialize in getting a homebuyers loans approved by falsifying documents and inflating incomes and credit ratings. As home investments have become the only lucrative investment game in town, a sort of a gold rush mentality seems to have gotten into homebuyers and investors.’
‘As an unintended consequence of absurdly low interest rates, many Canadians seem to think they’ve gotten rich and think of their home or second home as their bank. This ‘money’ sitting in their homes have made them bold enough to gamble and pick up second and even third properties.’
‘Now many banks would balk at their customers buying expensive properties even while their incomes have moved up significantly. Enter the mortgage broker who will take care of those minor details. The ones who won’t have anything to do with these illegal practices are losing big time to those who are able to generate the right paperwork, for a hefty fee of course.’
‘Rising real estate prices has caused the fraud’
‘A worryingly large number of homebuyers are finding that their dream houses are out of their reach because tighter regulations have made it harder. Real estate agents often steer such homebuyers toward their favorite mortgage broker who specializes in getting them their mortgage approved. He or she achieves this by doctoring pay stubs, creating false income statements.’
‘Investing in real estate is the rage’
‘Real estate agents and mortgage brokers now hold seminars for investors looking to make a killing in one of the hottest real estate markets on earth. There are any number of people who believe that what goes up doesn’t necessarily have to come down. It appears that the immutable law of gravity doesn’t hold up to scrutiny when it comes to real estate. There are any number of homeowners and investors I’ve spoken to who believe that the price of a home can only go up.
For their sake, for my sake and for Canada’s sake I hope they are right!’
I think I saw this movie before.
‘It’s a time of change here in Arlington. The Halloween displays are changing to Thanksgiving displays (and some Christmas ones, too). The leaves are all kinds of colors. And, the prices are changing on some homes across the county.’
‘These changes in price ultimately lead to more change (and bucks) in your pocket!’
‘This week, as of November 2, there are 255 detached homes, 76 townhouses and 325 apartments for sale throughout Arlington County. In total, 54 homes experienced a price reduction in the past week.’
This week’s “Just Reduced” properties in our neck of the woods include:
4508 41st Street North, Arlington, VA 22207 (NOW: $1,799,000 – Reduced $51,000 on 10/29)
737 Danville Street North, Arlington, VA 22201 (NOW: $1,398,000 – Reduced $100,000 on 10/30)
2807 27th Street North, Arlington, VA 22207 (NOW: $1,099,000 – Reduced $38,000 on 10/28)
4720 24th Street North, Arlington, VA 22207 (NOW: $836,000 – Reduced $13,000 on 10/30)
613 North Emerson Street, Arlington, VA 22203 (NOW: $760,000 – Reduced $18,000 on 10/27)
4430 36th Street South, Arlington, VA 22206 (NOW: $399,000 – Reduced $5,900 on 10/28)
1200 North Nash Street #204, Arlington, VA 22209 (NOW: $232,000 – Reduced $8,000 on 10/27)
the biggest.tallest building in DC are is empty
1812 N Moore arl ,va
Land costs, labor drive Boston-area housing prices out of control
Boston area housing costs hitting extreme levels
“Boston will be stuck in an endless housing crunch, despite adding tens of thousands of new residences in the past few years, unless it finds a way to curb the rapidly increasing cost of building here, a Boston Foundation report to be released Friday finds.
The study found that surging land costs, along with the already-high price of labor and materials, make it nearly impossible for developers to build new housing most Boston-area residents can afford.”
http://www.bostonglobe.com/business/2015/11/12/boston-area-housing-costs-hitting-extreme-levels/GqZU6MDkAI4poEw8EHwIoL/story.html?
Sounds like “The Boston Foundation” doesn’t really understand housing.
Falling materials
Falling labor
Falling housing demand
Falling housing prices statewide
Collapsing demand for land
That’s the reality.
You’ve been saying that for ten years….that’s the reality.
And all true.
Your point Jingle_Fraud?
12,602 nearby properties found Boston, MA Real Estate and Homes for Sale
http://www.realtor.com/realestateandhomes-search/Boston_MA?ml=4
5,244 nearby properties found Boston, MA Price Reduced Homes for Sale
http://www.realtor.com/realestateandhomes-search/Boston_MA/show-price-reduced?ml=4
41% of Sellers in Boston, MA reduced their price at least once
That’s cuz those jackasses are asking $629K for crappy old houses that are on the freaking highway: https://www.redfin.com/MA/Belmont/135-Radcliffe-Rd-02478/home/8453079
Check out the aerial view:Google map link.
Yup. Picture #9 shows the nice view of one of the giant highway signs. And do you really want to advertise the house as “truly the quintessential Better Homes & Gardens Home of the 1950’s.”
“Beautifully maintained by the original owners.” Translation: grandma finally died, leaving the original 1950’s cabinetry, paneling, bar, and bath fixtures.
Ugly as hell!
Ha! I didn’t even see that. Nice highway sign to accompany the gentle sound of 18-wheelers spewing assorted carcinogens into your backyard. But hey, at least you got a classy retro 50’s house.
Yikes! Personally I kinda like ’50’s houses and many of them are very well built…but no way I’d live that close to the freeway at any price let alone $600K and the noise is the least of it. Years ago I rented a place two blocks from US 101 for several months and everything outside would get coated with a fine layer of black grit….brake dust, tire dust, diesel soot etc. This stuff is NOT good for your health.
http://www.scpcs.ucla.edu/news/Freeway.pdf
My 1950s ranch house came with no header above the front door; a 12 foot expanse of sliding patio doors without a center support; casement windows with the hand cranks located in between the glass and screens; etc. Add in the vintage wiring and plumbing and you have a true quality home.
Hey, welcome back!
Add in the vintage wiring and plumbing and you have a true
quality homerun down obsolete firetrap.“…even though builder optimism is at levels that have not been seen since the housing boom, ‘black swans,’ like a stock market correction or an overseas shock, could have a negative impact in the future.”
Isn’t it a given that plunge protection authorities will do everything within their power to prevent black swans from taking flight?
‘The U.S. stock market remains well above the lows of the late summer sell-off, but fears about Chinese growth and commodity trends are keeping investors on edge, strategists told CNBC. Traders are still grappling with “tremendous concern” about growth in China, Ed Keon, managing director at Quantitative Management Associates, said Friday.’
‘China’s decision to devalue its currency — at least in part seen as a bid to shore up its exports — sparked the sell-off in August. On Wednesday, Chinese industrial output data fell short of expectations, raising fresh fears about the world’s No. 2 economy.’
“There is remaining concern about global growth, and it does seem to be slow and, if anything, heading slower,” Keon told CNBC.’
‘Since the crackdown began, CSRC officials and mid- to senior-level executives at Citic Securities have been forbidden from internal job transfers or resigning, people familiar with the situation told The Wall Street Journal.’
‘Representatives of Citic or the CSRC couldn’t be reached for comment. It wasn’t possible to contact the detained executives, and it wasn’t clear whether any of them had legal representation. Citic Securities has previously said it was cooperating with police investigations of several employees.’
‘As China’s markets tumbled, Beijing took a variety of unorthodox steps to keep money in existing stocks, including ordering brokerages and large shareholders not to sell equities. For now, authorities appear to have succeeded in winning back retail investors’ confidence. The main Shanghai index has rebounded 25% since a low in late August, when it had lost 43% from a mid-June peak, erasing $5 trillion in market value.’
‘Authorities have repeatedly railed against short sellers and other traders, alleging “malicious intent” that jeopardizes the country’s financial security. Their targets include senior securities regulatory officials, the head of the nation’s top brokerage, star private-equity traders and a financial journalist.’
“The authorities have arrested a lot of people, but we still don’t have a clear picture regarding the real reasons behind it,” Mr. Wu said of the crash. “Sometimes we just tell ourselves that we don’t really need to know the truth, as long as the market goes up.”
Employees forbidden from resigning? I’ve never heard of such a policy.
will do everything within their power to prevent black swans from taking flight ??
You can react to it but very nature of a black swan means you can’t prevent it…
‘Kelly Carter listed her five-bedroom house in Woodforest in May, and she’s had fewer than 10 showings. She thinks part of the reason it’s been slow is because she’s competing with new construction in the area. She doesn’t want to drop her price because she put in a $100,000 pool and spent at least another $10,000 on window treatments, shutters and automated blinds. She is, however, considering renting the house. Carter also owns a house in The Woodlands that she’s been renting since she and her family moved out a couple of years ago.’
“At that time, she said, ‘I could have sold in a day. It was tougher to find a renter than a buyer at that time. Now it’s kind of flip-flopped.”
Tougher to find a renter than a buyer? The year’s almost over and she’s had fewer than 10 showings. But the Houston UHS were saying in May it was hot hot HOT!. Maybe they were a lion.
’she’s competing with new construction in the area’
Uh, don’t tell me they are undercutting you on price Kelly! The same guys who sold it to you possibly. Meanies.
‘She doesn’t want to drop her price because she put in a $100,000 pool and spent at least another $10,000 on window treatments, shutters and automated blinds.’
A $100,000 pool? Does it have Las Vegas style laser shows? Looks like you took an ass pounding from the pool company too. Just tell that to the 2 people who drop by in the next 6 months. “See this pool? I took an ass-pounding on this baby so I’m not cutting my price, no Sir.”
A $100,000 pool? Does it have Las Vegas style laser shows ??
LOL…..
I’d bet two banana’s she refi-ed the house to get the 100k.
Kelly:
“I’d bet two banana’s she refi-ed the house to get the 100k.”
How else does one raise the cash to service massive debt loads besides pushing the losses further out?
‘This evening, Federal Housing Administration Principal Deputy Assistant Secretary Ed Golding joined National Association of Realtors® President Chris Polychron on stage before a packed ballroom of Realtors® and industry experts to announce changes to FHA condominium policies.’
‘NAR has long advocated for broad improvements to FHA’s condo rules, arguing that existing policy is overly restrictive and keeps many consumers from buying and selling a home.’
‘To address these concerns, Golding announced at the conference’s kick-off event that FHA will make changes to its condo policies in line with those requested by NAR. Those include changes to the lengthy and complex recertification process in place today, burdensome owner-occupancy requirements, and limits on the types of property insurance that are considered acceptable coverage under FHA’s rules.’
‘NAR has worked closely with the Department of Housing and Urban Development to push for changes to FHA condo policy, and NAR President Chris Polychron recently testified before Capitol Hill to bring attention to potential changes, including those related to recertification and owner-occupancy requirements. Golding told Realtors® at the event that changes related to insurance and recertification would take place immediately as part of a Mortgagee Letter to be released on Friday, Nov. 13. He added that policy changes related to owner occupancy, commercial space percentage, FHA concentration and spot approvals would be addressed in a formal rulemaking in the near future.’
‘Polychron issued the following statement about FHA’s announcement: “Realtors® and consumers got a welcome piece of news today with HUD’s commitment to fix FHA’s condo policies and broaden opportunities for families to find a home.”
“Condos are often the most affordable option for homebuyers, especially first-time buyers, and making sure FHA financing is an option is important to supporting homeownership. This is a win and a tremendous step in the right direction. NAR applauds HUD Secretary Julian Castro and FHA Principal Deputy Assistant Secretary Edward Golding for taking action to improve access to credit for condos. We look forward to working with them again in the future to help more Americans achieve the dream of homeownership.”
‘Effective immediately, FHA’s temporary guidance will streamline the agency’s condominium recertification process and expand the eligibility of acceptable ‘owner-occupied’ units to include second homes that are not investor-owned.’
Cuz we all know affordable means having an extra, unoccupied condo.
Where you find NAR you find crime.
‘China banks are sitting on roughly $14 billion more of bad debt than they were in June to a total of 1.19 trillion yuan. The China Banking Regulatory Commission said the non-performing loan ratio on the nation’s banks was 1.59%, up from 1.5% in June. Most in the market discount that number and believe it to be 10 times that.’
‘Smaller municipal banks have the biggest problems. These lenders are run by local leaders who use the bank as a means to fund friends and family pet projects, as well as providing loans to companies in hopes to maintain a stable labor market.’
“Chinese banks have been growing their debt by 30% or more over the last few years and we are seeing comments from our analysts that there is overcapacity in a number of sectors loaded with debt,” says Gerardo Zamorano, an emerging markets fund manager at Brandes Investment Partners in San Diego. “We think there can be more bad news to come in the banking sector. It’s hard to know for sure because transparency is not there, so we prefer not to be there either,” he said about investing in China finance.’
http://finance.yahoo.com/news/billions-more-bad-loans-china-150800340.html
Portland, OR Housing Craters; Prices Plunge 11% YoY
http://www.zillow.com/portland-or-97239/home-values/