‘The Pie Is So Much Greater Now’
A pair of reports on smaller housing markets, starting with the Tahoe Daily Tribune. “Deemed a market ‘correction’ of sorts, the South Tahoe Association of Realtors reported 495 single family listings on the market with 59 in escrow. That’s up from the average inventory of 300-plus homes.”
“Two months ago, the market showed 407 in current inventory. Last year at this time there were 268 homes on the market. A few years ago, 88 homes were listed.”
“‘The pie is so much greater now. The buyers right now are smart,’ said association President Theresa Souers. ‘We’re seeing a correction that’s happening across California.’”
“Agent Barbara Childs agreed that buyers are testing the waters and so are the sellers. She’s noticed more withdrawals as sellers become frustrated with the offers. ‘They have every right to do it, but if they listen to their real estate agent’s advice, these properties will sell,’ she said. They can’t change the location, but they can be flexible with the price and make improvements, she stressed.”
“‘People have choices,’ she said, while putting on an open house. She listed the 3,314-square-foot home in May. The seller is moving, so he’s reduced the price from $1.1 million to $899,000. Five other homes are for sale on the street.”
The Star Tribune from Wyoming. “Despite stagnant population growth and rising interest rates, the real estate market in southeast Wyoming’s intellectual capital has been ablaze amid rampant construction. Contractors are building homes and multi-unit apartment complexes at a feverish pace while developers press for more subdivisions.”
“The proliferation of new apartments already is affecting demand for lower-end homes, said Kerry Greaser, an owner of a 58-year-old Laramie real estate firm. ‘For years, we had a pretty tight rental market, and the private developers..saw that need and have been building a lot of apartments in the last five years,’ Greaser said. ‘Now, we are at an oversupply of apartments.’”
“Builders have overcompensated for what was a shortage in the rental market, and the new development is pressuring some property owners to lower rents, said (broker) Margaret Peterson. ‘I haven’t gotten to that point with the vacancies,’ Peterson said. ‘I have just forewarned my owners this is a possibility. We may have to reduce our rents.’”
“The construction and development explosion calls into question the source of the demand. Laramie’s population actually declined from 27,204 in 2000 to 26,050 in 2005, according to Census Bureau estimates.”
“Homes in Laramie and the surrounding area are among the most expensive in Wyoming. Some of that is due to the presence of high-end second homes. Local developers and builders, however, aren’t necessarily banking on wooing Laramie’s average wage earners. Jim Stephen of Gateway Construction said investors from California are buying some fourplex units in the Fall Creek development, while Arizonans also have expressed interest in the properties.”
“Laramie developer Grant Lindstrom expressed some apprehension over the construction and development boom in the city. ‘I think it’s going to be overbuilt pretty quickly,’ said Lindstrom.”
“‘I think the market is overpriced, and I think it is going to drop a little bit,’ said Dale Eslinger, a Laramie resident who owns 12 rental homes.”
Could someone tell me WTF is in Laramie, WY (pop. 26K)????? Oh, that’ll be a big boom market for sure. I hope I can get in on it!
A quick look at google maps will show you that Laramie is almost out of land.
It has an interstate and a railroad. I guess that means the big time?
The University of Wyoming!
And this:
“…Jim Stephen of Gateway Construction said investors from California are buying some fourplex units in the Fall Creek development, while Arizonans also have expressed interest in the properties.”
Requires this:
“I say: ‘California equity locusts for everyone!’”
there are more antelope than people in wy.nice to hunt but bite ass cold.
no speed limit and drive thru liquor stores.did i mention you can carry a side arm in public.although you must check in gun before entering most bars in town.not much crime their.
You say that like it’s a BAD thing….
its not i love the place no smog no crime hell i can even drink a beer at 90 mph
i go hunting there every couple years great place.unless you are in a ski resort the propert there is as cheap as it gets.all ranch hands making sub min wage and hardly any women its not a place to retire
http://freedomradio.us/news/2005/december/25_chief_leaves_gun.html
Notice that he wrote himself a reprimand and made a department-wide apology. That’s accepting responsibility.
Laramie owns the patent and trademark to tomacco. I want in on that!!
Hey, didn’t you read the article? Laramie is the “intellectual capital” of Wyoming.
You mean the intellectual Capital that produces mental giants like the ones that beat Matthew Shepard nearly to death and left him to die in freezing weather ? Yeah, I really want to live with rednecks.
http://www.matthewshepard.org/
You know, every so often you bump into a straight line that’s just too easy…
Beyond comprehension.
But, since they are at it why think small? Laramie ought to be able to support high-rise condos, perhaps half dozen 30 floor projects should be just about right. 250 units each. Price them at a reasonable $500k up to a cheap (and worth every cent) $1m for the penthouses.
A perfect fit. Investors from Fl, Ca, Az will buzz around this like flies around sh … uh, honey. Probable resale potential at least a 50% profit.
if you go to a wyoming bar and try to pick up a cowboy you will be beaten or worse.i dont reccomend u equity nomads from frisco or west la try to enlighten the boys in cowboy country.bareback cowboy belongs in hollyweard.
Frisco, Texas or Frisco, Colorado?
http://www.notfrisco.com
Geniuses were pretty thin on the ground the last time I passed through Laramie.
“‘The pie is so much greater now. The buyers right now are smart,’ said association President Theresa Souers. ‘We’re seeing a correction that’s happening across California.’”
Following along with the food motiff, we could say that the “pie” is made of crow, which FBs will eating a generous portion of in the near future. Or, you could substitute “pie” for “shit sandwich”, which must be eaten by Mr. Specuvestor. Either way, the “smart” buyers won’t be having any part of it for the foreseeable future.
Actually, said pie comes from a cow, of which they have plenty.
Next is Evanston, Wy and Vernal, Ut. The bubble has no bounds or meets. All submarkets will be driven to the point of unaffordability so that no local can afford to live anywhere without paying homage to the homeowner class. What is the world coming to?
Luckily, most states lack the physical and/or artificial constraints to new construction (NIMBY-esque zoning, UBLs, gratuitous palm-greasing fees, etc.) that plague relatively built-out developer-hostile areas like Los Angeles or Boston. I seriously doubt WY or UT will ever get that bad anytime soon. It’s too easy & cheap to build there. That said, the coastal equity locusts are measurably driving up prices in desirable urban areas all over the country (for now).
This will be remembered as “The Summer of The Locust”.
Even in Humptulips WA some CA plates have been spotted buzzing around looking to start chowing down on the local inventory.
It transcends all states and county lines. I have seen first hand BMW’s and Mercedes with California plates rolling through Grapeview in Mason county ready to start “chowing down”. There is, of course, a reason that land and housing is still so cheap in Mason county. NO ECONOMY!! Last time I checked the largest industry was… brushpicking! Yep, heard of it?! Hordes of illegal immigrants scouring our forests and decimating the plants as they ravenously chop off their foliage it down carry it on their backs and sell it back to the man for pennies so he can export it all over the world for millions in profits!! Isn’t life grand in the USA??
BanteringBear says ignore typos!
So, like, where the heck is “Grape County ? “
Mason County, Washington.
June 26, 2006
Home sales in the works down 40.3%
So-called pending sales — deals in the works, or “in escrow” — offer little hope for any quick revival of the recent O.C. home-selling slump. FirstTeam Real Estate says O.C. pending sales were down 40.3% in the year ended May 31. That’s a sign that early-summer closings sales will be weak, too. FirstTeam also says the supply of homes for sale is up 133.9% in the year:
I read that… great news!! Patience is a virtue.
Hey Crispy, did you ever find out if that 3000 finished new homes for sale in Bakersfield is accurate. If it is that is huge.
No. What I know is 2,086 new permits were issued from Jan to May. So the 3,000 seems rather high. However, there are a $hit load of new homes for sale that are finished. I am trying to obtain information from a local realtor - maybe I can pass this along.
the oc is quickly popping wont be long and it will be like phoenix san diego maybe even worse.
SHOCKING SAN DIEGO CONDO DATA:
The Mark, a new condo tower in downtown San Diego has 233 units. The Developer has sold 65% (pays off the bank loan) of the condo tower sold. That is 151 condos. The Developer has decided not to market the rest of the units until the complex has been completely built. There are 82 units left and they have sold 1 unit in the last 3 months, during the “peak sales season” of the housing market.
http://www.ccdc.com/index.cfm?fuseaction=projects.projectDetail&propertyID=489
BOSA’s Project the Electra has sold ~10 units in the last 4 months out of ~190 total at the Legend. They still have 80 units outstanding, but they are ripping down the sales office before selling those 80 units and marketing the new Bayside tower.
The story goes on another developer with a condo conversion with 150 total units is 50% sold out with only 3 units selling in the last 3 months. This list goes on and on. I can’t wait for the first article in a major news paper…
‘There are 82 units left and they have sold 1 unit in the last 3 months, during the “peak sales season” of the housing market.’
Is there just a wee chance they are asking more than the market will bear, given all the stories about the risk of downtown SD condo prices falling due to an excess of speculation? (Even Alan Gin, normally a real estate bull, suggested as much…)
I guess that means they have 20.5 years of supply in that one building alone.
Similar to other major bubble areas I imagine it is difficult for a non-resident to truly comprehend the number of condos coming online.
The weekend before last, the wife and I took a walk from North Park down to the edge of downtown and back (9 miles!)
There are condos everywhere. In every phase of construction. From half-done conversions to empty holes in the ground to scaffolding to completed and selling. It is incomprehensible.
Locally (again, North Park) there is a condo conversion of a very 70s apartment building. They didn’t really change the facade enough to get rid of that feel. They put in crown molding, but left the 70s era gas wall heater (old boxy non-forced air). Anyways, of 8 units 2 have sold and another 2 are “pending” according to the Realtor-bot I spoke with yesterday.
“Homes in Laramie and the surrounding area are among the most expensive in Wyoming.”
Now there’s a relative comparison I’m hard pressed to grasp. Compared to Casper and Cheyenne, I suppose. I wish I loved cold weather and had enough money for a second home, because I think I’d look there. But I don’t and so I won’t. Imagine the folks there are just as happy to keep the place to themselves, to the extent they can.
Just to make sure all the Kalifonians are understand, Laramie is a freezing, windy, desolate hell hole. No indoor plumbing and filled with rednecks. Move along, nothing to see here. Chip is delirious and not thinking straight.
LOL — that Broken Trail miniseries make the area look pretty good. For summers.
The climate will do it for them. Wyoming is beautiful, but cold, lonely, and redneck. All three will keep out the latte sippers for a long time. Good for them! Now if Oregon could just get one (or several) of those “cow killer” winters we could chase a few of those locust out too.
“The buyers right now are smart.” …and in six months they’ll be smarting.
Her comment did seem to be laying it on a little thick.
Not sure what happened to my original post, but oh, well, here goes try #2:
In keeping with the referenced article’s housing “pie” motiff, FBs will soon have to eat a generous helping of this pie. Principal ingredient: crow. Some of us would consider it closer to a “shit sandwich”.
McMansion - eat sh**.
(anyone remember those McDonald’s spoof stickers?)
“‘I think the market is overpriced, and I think it is going to drop a little bit,’ said Dale Eslinger, a Laramie resident who owns 12 rental homes.”
12 rental homes amongst a saturated apartment market? I think I’d just go camping w/ one of them “brokeback Mountain” cowboys and get what I have coming to me.
God, that was funny.
got a silly question…but I am first time buyer and I am confused as to how much monthly payment is wise (as a % of gross monthly income) to take on..so that I can afford the house, maintenance and maybe one vacation a year. In talking to Real Estate agents and loan consultants…I can’t ever seem to get a straight answer.
Any help will be appreicated..thanks in advance.
It also depends on how much you make. For under 100k it would be the 28/36% rule, above 100k it can be more liberal.
When you’re at 250+ Debt to income ratios can get to 45-50% for obvious reasons.
Why are you buying now ? For the love of Pete STOP, WAIT, DON’T DO IT !
Atrain — I’m not going to advise you, but will tell you that when my PITI payment was 36% of my gross pay, I was just OK but did not have much left to have fun with and certainly not enough left to make any meaningful savings. That was during child-rearing days. What is important for you to do, I believe, is to ask how much PITI should be, relative to income. PI = principal and interest. PITI = principal, interest, taxes and insurance. Since the latter two vary far more among the states, than do mortgage interest rates at any given time, PITI will get you a better-educated answer, especially if it’s from someone who is not in your state. The answer, too, will be different if you have a fixed rate mortgage versus a variable. “Dr. Don” at Bankrate.com entertains these questions regularly — give him as many specifics as possible if you go that route.
Actually, MoMoney has it right. Why in the world would you be buying now? I owned for 35 years, sold and now am renting until prices (and by extension taxes) retreat *substantially* in an area where I’d like to live.
Don’t forget to ask about the cooling/heating bills for any house you look at plus water/sewer rates. Don’t go into a house if your cars are old and need replacement soon. Have a cash cushion above and beyond your downpayment for the unexpected expenses you will run into.
“Atrain — I’m not going to advise you, but will tell you that when my PITI payment was 36% of my gross pay, I was just OK but did not have much left to have fun with and certainly not enough left to make any meaningful savings.”
That’s how it was with me in 1991. I regretted buying when I could only scrape up $1,000 savings that year and the rest went to PITI. To make it worse, Atrain, if you buy now you will run the risk of watching your house value decline over the next few years and that will be a real backstabber! Believe you me! I say DON’T BUY NOW! RENT INSTEAD!
LOL - Funny Joke!
come to bens blog 2 times a day for a week and then you wont ask such a silly question
First time home buyer…
Depending where you live, I suggest you might consider renting. Just a thought.
The general rule is about 28%-33%. Your expenses will vary and you would need to pencil that portion out for yourself.
A better question to ask yourself is whether you should be buying in your local market at all. In my own case, my rent is ~40% of what the cost of buying something comparable would be and local real estate prices are declining. Own? No thanks.
Not investment advice.
Rich means more power than FPL
When it comes to generators, bigger is better for South Florida’s affluent class. After all, true luxury means having electricity at ALL times.
http://www.miami.com/mld/miamiherald/14902062.htm
This truly IS a thing you see advertised in the real estate section for high end homes (say, $1.5 mil and up). Of course, the problem is fueling the darn things … running a regular generator just to power a window unit and maybe a fridge uses gallon after gallon of gas. And since everyone is fighting for gas before and after a storm, you may be SOL even if you have a generator post-hurricane because you can’t get any gas to run it. Me? I’ve got no problem eating spaghetti-o’s cooked on the grill or tuna fish sandwiches on crackers (both of which I did in the 2004 canes!) And as long as you’ve got enough ice to keep the beer cold, no worries.
Of course, there is the possbility you get a cane bad enough to rip your roof off, in which case a generator isn’t going to do you much good because your duct work and compressor will be spread out all over the neighbors lawn.
All right, speculation in Laramie. That’s what I like to see. With declining population, wow. At least builders and realtors are starting to acknowledge it. A year ago you would have heard “No way, bubbles happen in California and Florida, not here.”
OT, this SDCIA thread would scare me away from RE speculation for the near future. Who’s still speculating? I don’t get it:
Losing shirt in Tucson
Also of note, I listen to financial “no debt” guy Dave Ramsey on the radio, and he’s gotten increasing calls from people trying to sell their houses for whatever reason, and they find them sitting for months. Dave is super conservative financially, but still hasn’t mentioned the possibility of major price drops. Incredibly, just today he mentioned looking at YOY appreciation to decide if you should buy in a certain area (e.g. “In my area it’s running at 10%, so I know that in 3 years it will have appreciated enough to cover commissions and fees.”). Well, then, let’s all start buying up Phoenix!
I see txchick57 has been over there to twist the knife a bit
That was the same thread in which another poster recommended lender fraud as an exit strategy.
Here’s another thread from the same site that is almost equally pathetic:
http://www.websitetoolbox.com/tool/post/sdcia/vpost?id=1161746
Synopsis:
A flipper has cleaned up an 1158 sq ft scraper. It’s a tiny 3/2 on a 5400 sq ft lot that had gone to seed at 5062 Mount Casas in San Diego. Flipper bought in the mid-400s and is asking almost $600,000.
Trouble is, it’s worth about $175,000 and I wouldn’t pay more than $1200/month in rent for something that small in that area.
Arf-Arf-Arf!
Great link. Love the comment:
“if you can handle the neg flow, rent it out and come to terms w/ the fact that you will be holding (neg flow) for the next 5 or so years. Thats what i did. ”
INTENTIONALLY suck neg for 5 years? And in Tucson ! WOW, someone’s long cajones (but short brains). Boy, have I got a deal for them….low down, low payments..
For the benefit of the board, I will post Txchick57’s flame of the small-brained nimrod who is losing his greedy ass (must…not…laugh) on his Tucson flipper-house. While his fellow flippers try to console him — or encourage him to commit mortage fraud — Txchick wades in with an unwelcome dose of straight-up reality:
My advice to you would be next time, consider the possible downside to your greed before you do something stupid like that again. Houses are places for people to live, not a commodity for clowns like to you flip like the burgers you will all be flipping shortly. Sorry I didn’t know about you when I was looking for a place to rent in Tucson last month. I might have paid you as much as $900 a month.
With that said, my participation in this ridiculous circle jerk is done forever.
Hope you all enjoy your debt slavery.
Txchick57, you ROCK!
Your Humble Servant,
Sammy
Ms. Chick,
What is thy bidding, my master?
she is a beyotch and i love her for it.give em hell tx chick.
Sometimes I think half the country spends every waking minute trying to screw the other half.
Yet ma and pa keep coming back for more.
OT: Locals still like McMansions
SW Florida bucks trend for oversized homes
Article in the Fort Myers News Press
http://tinyurl.com/sx6xf
“That’s the hottest product in Southwest Florida,” said Trae Zipperer of RE/MAX Realty Group. “If I had 10 of ‘em, I’d sell ‘em this week if they were priced right.”
Yeah, sure Trae - “…if they were priced right.” And, I’d be making a half million a year - if, I had gone to Harvard Law School.
By the way, it’s been said here before, but bears repeating:
Do all realtors have to have funky, ridiculous names?
Trae Zipperer - WFT?
Most of Tahoe has been taken by rich Bay Area millionairs. Most were overbidding and doubled the price in one year. Where they get the free money? From the inflated stock options like Yahoo and others that traded at their peaks in late 1999.
No one can come up with that kind of cash except some new rich folks from Google. And where did they get the cash? Guess ?
Wyoming needs to stay the WHITE SPACE that it is now. It’s only attraction is wide open, unspoiled places. There are no real jobs there.
Oh, and Yellowsone is a supervolcano looking to explode anywhere from now to 200,000 years from now…. hmmm.
thanks for the advice..I am not going to buy now..but am getting my ducks in order…cause I think the opportunity to buy will be sooner rather than later.
I lived like a pauper for 10 years out of college and have enough for a 20% down payment…I just want to do the math (regarding how much I can afford) beforehand so I can pull the trigger fast when a good opportunity comes along. By good opportunity…I mean at least 30% less than today’s listed price.
btw….I live in Los Angeles, CA…and I can’t seem to figure out why every home is above 800K. Who are these pre-qualified people waking around?
just buy a cabin in pinedale under 100k you can only stand the weather 4 months a year.you rent the cabin to hunters for 200 a week.
Who are these pre-qualified people waking around?
Weathy immigrants?
Are any of you guys familiar with the Belmont Tunnel in Los Angeles? It was an old tunnel that trains used to use to go through a hill in LA. It has always been a real bad part of LA (near the Rampart district) with gang graffiti on the walls all over in that area. A few movies have been filmed there including that old 80’s gang movie “Colors” and one of the “Predator” movies was also filmed there. Anyways I was driving through the area yesterday and noticed that they were painting over this long wall to cover up all of the graffiti that has been there since I was in High School back in 89. They had the wall halfway painted clean, and half was still vandalized. Anyways I was thinking why the hell would they clean this up after all these years? Then I found out why. I turned up a street that takes you up above the tunnel and noticed there’s a new condo complex being built there. Right in this gang infested area! I couldn’t help but laugh at how big this bubble has grown. I’m sure the developers struck some kind of deal with the city to get all of the vandalism cleaned up to help with the sale of the condos…………lol
I see the same thing in Santa Ana. I went to those lofts near the train station. I was the only one there viewing the models. I thought they were ugly. Your first floor is your business and your garage space. Second floor is living and kitchen. Third is a bedroom. I hate stairs!!! They start at 500k.
Anyway, this is a bad area. They even had a security guy out front to make sure it was safe. I had to laugh. There is a recycling dump right down the street. So much for fresh air. Their first phase sold out (to a bunch of speculators I hear) and they have started their second phase.
Did anyone see those new homes going up (Shea Homes) off the 5 freeway starting at a mil? I think it’s around Main in Santa Ana.
In Anaheim, they have condos going up everywhere. They just now starting another one off state blvd by the Wells Fargo Building.
Condos and lofts for everyone.
“Condos and lofts for everyone.”
*******
Speaking of - anyone else see the right field wall in the outfield in last night’s ESPN Sunday Night Baseball telecast, with the Astros playing the White Sox in Chicago?!
I tuned in during extra innings and the first thing I could see were… 6 foot high letters advertising “OWNACONDO.COM”
Bubble? What bubble? No bubble here…
no national boom? sorry mr. rogers, even the commodities boom won’t hold up real estate in Iowa or wherever(well, except maybe fort mcmurray).