April 11, 2008

The Value Of Housing Has Come Unhitched In California

The Sacramento Bee reports from California. “Across the colorful history of Sacramento, it’s likely that few people have received as much advance celebrity as Cathy Del Brocco for the simple act of selling their house and leaving town. And few took so long to leave. She listed her house in the Pocket for $335,000 and planned her move to a quieter place with a cheaper price tag. But there was just one problem with this grand plan: Del Brocco lived in Sacramento, and she couldn’t sell her house to save her life.”

“She put it on the market about 10 months ago and had to drop the price five times before it sold. Meanwhile, the price of a home she had seen in Holland, Mich., kept falling.”

“She declined to name what she finally got for her Sacramento house. But you can probably guess. Subtract 10 months from $335,000 in this market and you’ll be close. Here’s one hint: It was listed for $284,000 in February.”

“The good news for Del Brocco: The price was dropping at the house she eventually bought in Michigan. It sat 291 days on the market and was vacant.”

“‘It went down to $125,900,’ Del Brocco said. ‘I offered $100,000. They came back at $118,000. I came back at $114,000, and that’s what I got it for. It’s the cutest house.’”

The Sacramento Business Journal. “New-home prices fell for the eighth consecutive quarter to the lowest level since 2003. The Sacramento area’s median new-home price declined to $359,000 during the first quarter, a 7.5 percent drop compared to $388,000 in fourth-quarter 2007 — and $107,000 less than the peak two years ago.”

“Centex Homes was the top builder in the six-county area by a wide margin through the first two months of the year, according to Hanley Wood Market Intelligence. Division president Doug Pautsch attributed it to a variety of factors, including aggressive pricing, customer service and the location of its projects.”

“‘I don’t think there is a simple answer,’ he said. ‘There’s no silver bullet.’”

“Folsom-based Elliott Homes Inc. appears well-poised for the long haul after paying $10 million this week for 400 acres of GenCorp Inc.’s unused real estate off Highway 50 in Rancho Cordova.”

“That comes to $25,000 an acre, a lot less than the $100,000-an acre figures some builders were paying for land during the housing boom. At those land prices, a privately owned builder can compete all day long against big Wall Street builders that dominate this market.”

“Sacramento real estate agents have long maintained that more than 40 percent of homes for sale in Sacramento County and West Sacramento are vacant. This week, commercial broker Mary Collins said thieves hit the vacant house next to hers in Rio Linda. They arrived within a week of a for-sale sign saying the home was bank-owned.”

“‘They took the lighting, the copper and the air conditioner. It just takes 50 percent of your equity overnight,’ she said.”

“The first of several reports on first-quarter home sales is in, showing the number of new homes sold in the eight-county Sacramento region has fallen to the lowest level since possibly the early 1990s.”

“After a free-fall in sales and prices that has lasted nearly three years, any notion of mere stability will appeal to thousands of area homeowners who have seen their values fall. It also will appeal to sellers who have lost bargaining power in a market where buyers rule.”

“‘We’ve dropped the price twice, maybe three times,’ said George Vargas of Elk Grove this week. ‘We’ve had a few more people since our latest price drop, but it’s slowed down in the last month.’”

“DataQuick’s Andrew LePage said banks have sold only about 40 percent of the homes they foreclosed on in the region during the second half of 2007. The thousands more slated for sale will put a downward pressure on prices. ‘There are just a heck of a lot of foreclosures to burn off before the market can kick into gear in any big way,’ he said.”

The Monterey County Herald. “There are nearly 1,200 homeowners in Salinas on the brink of foreclosure, according to the State and Consumer Services Agency. Some of them were likely among the hundreds who sought help with their loans Thursday at a workshop at Sherwood Hall in Salinas.”

“‘Tell them exactly what your situation is,’ Supervisor Lou Calcagno told the distressed borrowers. ‘You got involved in a situation that wasn’t of your making. There’s only so much the government can do, but at least it can show you the way.’”

“The first step is to make the phone call, be ready to wait in line forever and be transferred from one customer service representative to another. ‘It’s the hardest call you’ll make, and near the end maybe it’s going to piss you off,’ Mary Harman, past president of the Orange County Chapter of the California Association of Mortgage Brokers told the group.”

“Maria Matamoros already tried to refinance her home loan, but because she’s the registered owner of her niece’s home, the retired 62-year-old did not qualify. Matamoros and her niece often ask their relatives for help with the payments for the $620,000 home they bought only 13 months ago — a home now valued at $400,000.”

“After hearing about the modification process, they want to see if they qualify. ‘I really can’t pay,’ Matamoros said.”

The Fresno Bee. “Speakers delivered a mixture of good and bad news at the Greater Fresno Area Chamber of Commerce annual economic reporting conference. The keynote speaker, Gary Schlossberg, senior economist at Wells Capital Management, said he thinks the country has entered a recession but doesn’t believe it will be particularly deep or long.”

“He called for more perspective on housing. Prices have fallen 15% to 20%, but that came after a run-up in values of up to 225% in some areas between 1998 and mid-2006.”

“Foreclosed properties comprise 15% of the inventory, or 1,100 houses; account for 38% of the homes in escrow; and have been 25% of all home sales in the Fresno and Clovis region over the last six months.”

“Paul Gibson, co-owner of Guarantee Real Estate and Home Loans, said low interest rates, new loan programs and Fresno’s relatively low housing prices provide a catalyst for renewed strength.”

“‘Is this a recession or a fearcession?’ he asked. ‘The subprime [mess] won’t submerge us. But if you watch too much 24/7 talking heads news, it will mess with your mind.’”

The Daily Breeze. “After several years of sharp spikes, Los Angeles County apartment dwellers will see only modest increases in their rent this year, thanks to the tepid housing market, a report predicts.”

“USC Lusk Center for Real Estate forecast director Delores Conway said the apartment sector should weather the housing slump and credit squeeze as long as Southern California doesn’t lose large numbers of jobs.”

“‘Renting remains attractive when mortgages are harder to obtain for high-priced homes,’ she said.”

“And renters will have more choices with many newly built apartments and some condominium projects that have reverted to rentals as well as foreclosed homes hitting the market.”

“‘The shadow market of houses and condos for rent will continue to grow as owners lease properties rather than sell at a reduced price,’ she said.”

“Jack Kyser, chief economist at the Los Angeles County Economic Development Department, said more apartments are coming on the market in downtown Los Angeles. While that will limit landlords’ ability to raise rent, it will not put them in dire financial straits.”

“‘I think people are just going to be looking more at renting rather than going out to buy,’ he said.”

From ABC News. “All around Beverly Hills, ultraluxury condo complexes are sprouting up in an outward show of confidence from investors who have seemingly ignored forecasts that the high-end property market will slow to a crawl.”

“‘The talk is of a United States on sale, but the truth is that it remains the best place to invest money longer term,’ economist Jack Keyser said.”

“The CPC group headed by Brits Nick and Christian Candy spent $500 million on a site the previous owner had purchased for $33.5 million just three years earlier. Their idea: build 252 condos and run away with a billion and change.”

“Not all experts agree that the high-end real estate market will be able to buck the trend of property value decline indefinitely.”

“‘Markets are segmented and the high end benefits from a more affluent buyer class, but it still can’t defy the laws of supply and demand,’ said economist Stuart Gabriel, director of the Ziman Center for Real Estate at UCLA. ‘This high-end market will see weaker demand and some slowing as a result — it just takes a little longer to hit.’”

“Cranes tower over the desirable parts of L.A. and the real estate market is primed for the sale of the 29-bedroom, 40-bath former home of William Randolph Hearst and actress Marion Davies, which is on the market in Beverly Hills for $165 million.”

“Look a little closer though and you’ll meet developers whose ebullience has dampened and you’ll find a $165 million mansion that has sat on the list for more than a year.”

From KGTV San Diego. “Earlier this decade, Chula Vista was one of the fastest-growing cities in the nation. Four years ago, almost 4,000 homes were built. However, this year, the city will be lucky to see 500, according to city officials.”

“‘For us, new homebuilding has come to a screeching halt,’ said Chula Vista City Manager David Garcia.”

“Now, instead of new homes, there are more foreclosure signs. Home prices are dropping, and for people who are still in the area, they are looking to pay less property tax.”

“‘They’re saying, ‘Hey, the house down the street sold for $100,000 less. My house is worth less, so I’m going to appeal my property values,’ said Garcia.”

The North County Times. “It took a jury less than two hours Thursday afternoon to unanimously clear a real estate agent accused of failing in his duties to a couple he helped buy a tony Carlsbad home.”

“Marty and Vernon Ummels say that the $1.2 million price tag for the upscale coastal Carlsbad home they bought in 2005 could not be justified, especially when other houses on the street were selling for much less, vital information the couple said they didn’t get until after the close of escrow.”

“But the jury found that Little had not breeched his responsibility to the couple as their agent, nor had he been negligent. ‘Mr. Little did what he was supposed to do,’ jury forewoman Wendi Brick said. ‘The bottom line is that you (as a buyer) are responsible when you sign a contract and purchase something.’”

The Union Tribune. “‘Of course, it’s devastating and shocking that the standard of care (provided by an agent) doesn’t seem to include having the agent tell you about houses that sold on your block for much less money,’ Marty Ummel said. ‘I believe it’s the agent’s responsibility to do his due diligence and inform his clients of any material fact that would impact their willingness to buy or not buy.”

“‘The jury spoke, but what they decided hurts the real estate industry. It says the Realtors don’t have to do their due diligence,’ Ummel said.”

The Voice of San Diego. “The case attracted national attention as it posed a hot question: What are the responsibilities of a real estate agent?”

“The real estate camp was concerned that if the plaintiffs won Thursday, it would catalyze and focus a growing urge around the country to find someone to blame — and to hold financially responsible — when houses aren’t worth as much as their buyers once paid.”

“At a time when housing market trouble has rocked the global economy, the individual roles of people involved in the basic housing transaction have come under fire. A soaring market this decade hid a multitude of mistakes, a plethora of cut corners and fudged appraisals, because buyers could sell for a profit, nearly no matter what.”

“But now that the value of housing has come unhitched from what once propelled it upward by double-digit percentages year after year, a spotlight has become trained on the topic of ethics in real estate.”

“Attorney David Bright said his client, Little, was being unfairly blamed for the Ummels’ house dropping in value. ‘I think Realtors are scapegoats for a declining market,’ Bright said after the verdict was reached Thursday afternoon. ‘There are always people out there who will blame someone for something that is beyond their control.’”

“But Marty Ummel…said the jury’s decision enables real estate agents to skimp on information they provide to their clients. ‘I think it sends a bad message to people about the real estate industry,’ she said. ‘Evidently there is not the relationship of trust that I would’ve expected.’”

“And Todd Lackner, a real estate appraiser not associated with the case, said the Ummels had ‘lost the battle but won the war’ when it came to raising questions and delivering a hit to the reputation of real estate agents.”

“‘I think it’s scaring Realtors more than anything else,’ he said. ‘[Little] won the court case, but there’s a lot of other Realtors out there that are very concerned. Not just in San Diego. It’s got to be nationwide.’”

“‘I think people are a little bit more skeptical, more concerned, and rightly so,’ he said. ‘If you don’t think this is the right value, don’t do it.’”




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148 Comments »

Comment by aladinsane
2008-04-11 12:02:11

Will the last California equity-refugee please close the door?

“The good news for Del Brocco: The price was dropping at the house she eventually bought in Michigan. It sat 291 days on the market and was vacant.”

“‘It went down to $125,900,’ Del Brocco said. ‘I offered $100,000. They came back at $118,000. I came back at $114,000, and that’s what I got it for. It’s the cutest house.’”

Comment by KC
2008-04-11 12:19:40

I grew up in Holland Michigan. It’s a pretty town, but the winters are brutal. Hope she has warm clothes.

Comment by DinOR
2008-04-11 12:24:20

Yeah, as a kid growing up in Chicago the Tulip Festival looked like heaven. Then again that’s spring time.

 
Comment by Climber
2008-04-11 12:41:25

I disagree about the winters. The lakes moderate the temperatures substantially, and I just love the snow. Grand Haven even used to have a ski hill that looked right out onto the lake.

The house prices reflect the employment opportunities.

Comment by Big V
2008-04-11 14:07:57

I’ve always thought that house prices in cold places partly reflected the added heating expense.

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Comment by KC
2008-04-11 17:29:17

Hmmmm. Not so sure about that. I remember many snow days from school as a kid - with the wind chill factor the temperature was 40 below zero. However, I do have great memories of Michigan. Still love the summers. We had a house on Lake Michigan. It was a wonderful place to grow up. School system is good, too.

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Comment by AdamCO
2008-04-11 13:11:53

I love that part of Michigan. It is beautiful in the summer and winter. The people are great. I’d take it over Sacramento any day, if it weren’t for employment prospects.

 
Comment by Jerry D
2008-04-11 20:32:21

How’s that “sun shine” equity doing? Going down fast I suspect with no buyers.

 
 
Comment by Deflationary Jane
2008-04-11 12:21:05

Honestly, if I were retired, I’d be out of here too. The californians who diss the rest of country have no idea what they are missing.

Comment by hoz
2008-04-11 12:42:18

The East side of Lake Michigan is gorgeous, not like the West side of the lake. Wisconsin is dreary and bug infested. A horrible place to visit.

Comment by Arizona Slim
2008-04-11 13:08:42

Thanks! You’re bringing back wonderful memories of bike trips and ski weekends along the east side of Lake Michigan.

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Comment by aqius
2008-04-11 13:45:50

I bet the sellers in Michigan held firm in selling close to their asking price because they knew the buyer was the fabled rich equity carpetbagger from California & they had hit paydirt.

Stupid woman; she should have insisted on strict privacy during this transaction, just disclosing the bare minimum of financial info needed to conduct bidness.

Example; Walt Disney purchased his thousands of acres of Florida orange groves for DisneyWorld using a couple of phony shell corporations, as he knew the locals would jack up prices once his name was released as the buyer.

Of course keeping personal info private during any business transaction is almost impossible, especiallhy in real estate, as real estate agents & the industry in general are ultra-talkative AND nosy about everything, and all it takes is for one person along the complex transaction chain to let slip that the buyer is a “rich CA woman” and not some poor cash-strapped local.

In fact I’d bet big money on some snoopy, gabby, shrew, anywhere along the way, from the agent to the bank, informing the Michigan sellers how they struck gold, all for the glory to bask in the spotlight of appreciation!!

It’s human nature.

 
Comment by DinOR
2008-04-11 14:12:07

aqius,

It’s even worse than that. Now that we have Zillow and PropertyShark etc. people can tell how long you’ve been there, how much you paid etc. They even have a “Make Me Move” price feature.

(But this isn’t anything like daytrading stocks of course)

 
Comment by Skip
2008-04-11 14:34:18

Here’s a story on yahoo about how rich try to buy homes in secret:
http://news.yahoo.com/s/bw/20080411/bs_bw/apr2008bw20080410941624;_ylt=AqGEaSnNt8V2Oo8rUs8OkZiBGLMF

 
Comment by aqius
2008-04-11 14:56:25

Good find, Skip, thanks.

DinOR, I grok you. Keep on rockin in the free world.

 
Comment by WaitingInOC
2008-04-11 15:33:13

Skip, the funniest part of that article is the woman’s name: “Laurie Moore-Moore, founder and CEO of the Dallas-based Institute for Luxury Home Marketing.” Why the hell do she’s use “Moore-Moore”? I understand the concept of hyphenating to retain your maiden name, but here it makes no sense.

 
Comment by Big V
2008-04-11 17:15:29

Moore-Moore is Better-Better

 
 
Comment by Steve W
2008-04-11 14:17:10

Yowza, did you get some moldy Cheese during your last visit? Wisconsin is the best, apart from the fact that the residents are Packer fans. Lots to do outdoorsy. No, it’s not Yosemite, but it’s far from horrible.

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Comment by hoz
2008-04-11 14:33:30

The last thing I want is to be invaded by pests from California or Illinois! Wisconsin is miserable go someplace else.

 
Comment by Steve W
2008-04-11 14:58:01

Ah, but I’m already a pest from Illinois. Bwa-ha-ha-ha!

Happy weekend!

 
Comment by ET-Chicago
2008-04-11 14:58:55

The last thing I want is to be invaded by pests from California or Illinois! Wisconsin is miserable go someplace else.

Hey now, don’t go comparing your lovely, well-tempered neighbors to the south with Californians. Some of us have folk therein Cheeseland, you know. (Or I did until recently.)

I’m fond of both Wisconsin and Michigan, but it does seem like Wisconsin has a more viable economy. I fear for Michigan sometimes.

 
Comment by jetson_boy
2008-04-11 15:37:37

“The last thing I want is to be invaded by pests from California or Illinois! Wisconsin is miserable go someplace else.”

Trust me- my folks in TN are getting pests from FL, CA, NY, MA, -the rest of the Northeast, and yes- even Wisconsin. They all want the same damned thing too:

” Hi, we’re from ( x) and it’s toooo expensive, cold, crappy, jobless here for my wife and 10 kids. Can we move down there and buy 20 acres for 50k?” Is it super-safe? Is it perfect in every way? ”

Then they get a tad disappointed that in that neck of the woods, the homes might be cheap9er) but the jobs are mostly service industry paying 8-10 bucks an hour. Then they complain. Luckily, that little report about Nashville shows that sales are down and inventory is up. Perhaps the tide has shut off for awhile.

 
 
Comment by Bucky
2008-04-11 14:41:29

You must be talking about Kenosha. The rest of the State is gorgeous and full of lovely (albeit portly) people. However, the voting majority are ill-informed, especially on the function of supreme court justices.

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Comment by Leighsong
2008-04-11 21:34:58

Sir Hoz,

On the slight chance you read the following:

(I love WI)!

Shhhhhhhhhhh…yeah…east side!

Leigh ;)

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Comment by Big V
2008-04-11 14:10:21

Hi Defla:

Hey now, some of us dissers have lived in plenty of other states. While I agree that the price and congestion in California are a huge drawback, I still must insist that this state has the best natural environment.

 
 
Comment by caveat_emptor
2008-04-11 12:22:32

A declining market is great when you’re looking to “move-up”. Price declines on the new (presumably more expensive) house should more than offset the losses on the cheaper house you’re trying to sell. Downsizers like Del Brocco are the ones who get clobbered.

Comment by DinOR
2008-04-11 12:39:51

caveat,

Great point and about 90% of the reason the wife and I will likely never consider moving up. Part of the backlash effect this time is that you’ll need to be a little… younger than we are for that to make sense? Sure, you can enjoy all the space/quality of life stuff but without any market appreciation at your back we’d just be making payments.

Plenty of mansions out there to be rented. :)

 
 
Comment by Not Mssing It
2008-04-11 13:16:15

What a shame. She just threw away an extra $14,000. If she had waited just 24 measly hours these sellers would have bit.

ATTENTION BUYERS: It’s your market you see. It is NOT a sellers market.

Comment by aladinsane
2008-04-11 13:23:19

Nobody will ever accuse Americans of knowing how to bargain properly…

Comment by Big V
2008-04-11 14:16:20

Hey Alad:

I think we’re the business center of the world, aren’t we? If you’re referring to the fact that we always end up paying more when we travel in poor countries, well, there’s not much we can do about that. They can see we’re Americans, and they fix their prices.

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Comment by aladinsane
2008-04-11 14:18:33

We are a nation of shoppers, not buyers.

 
 
 
Comment by flint 'burbs
2008-04-11 17:59:29

You are forgetting that her agent’s cut depends on the final selling price! SHe jumped to the higher level, not waiting for them to come down to her starting bid. If it was really that nice, my final bid would’ve been $109,000, not $114,000. I can find plenty of places for $5000, not in someone else’s pocket, sho ’nuff!

 
 
Comment by jbunniii
2008-04-11 15:14:03

I can’t understand who this woman is, or why this merits any news coverage.

 
 
Comment by Arizona Slim
2008-04-11 12:03:39

From the original post:

“‘The shadow market of houses and condos for rent will continue to grow as owners lease properties rather than sell at a reduced price,’ she said.”

And, as these owners start to learn that being a landlord isn’t a bowl of cherries, they’ll be dumping those houses and condos on the resale market.

Comment by gascap
2008-04-11 13:50:40

Despite a recent DataQuick report that found Los Angeles County homes have decreased in appreciation by 12 percent this year
I love this gem from the LATimes, is the reporter completely dimwitted or is this the PC way of say ‘depreciated’?

Comment by Big V
2008-04-11 14:18:33

“Decrease in appreciation”. To me, that means something appreciated at X last year, and appreciated at X-Y this year. In LA, however, that is not the case. LA appreciated at X last year, and at -Y this year. That’s depreciation.

 
 
 
Comment by edgewaterjohn
2008-04-11 12:04:32

“‘They took the lighting, the copper and the air conditioner. It just takes 50 percent of your equity overnight,’ she said.”

What FB has any equity to take?

Comment by Front Range Bob
2008-04-11 12:18:31

“What FB has any equity to take?”

She probably meant market value. RE pukes get confused about the difference between the two terms; it’s all semantics to them.

Try talking about economic factors with NAR buttboy Yun, and all he’d probably hear is “Yadda yadda, profit, blah blah blah, equity.”

Comment by sfv_hopeful
2008-04-11 13:21:54

LOL. Just to play devil’s advocate, AC, copper, and lighting should be I dunno… around 10k? Perhaps the home was worth $20k?

Comment by Front Range Bob
2008-04-11 13:31:33

My thought is that if someone tears all of that out of a house, the sellers would be lucky to get someone to pay 20% of the pre-destruction value. :-)

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Comment by Skip
2008-04-11 14:43:31

If they neglected to turn off the water before the removed the copper pipes it could have easily caused damages in the range of 50% the value of the house.

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Comment by ragerunner
2008-04-11 12:06:33

“‘Is this a recession or a fearcession?’ he asked. ‘The subprime [mess] won’t submerge us. But if you watch too much 24/7 talking heads news, it will mess with your mind.’”

I thought that was what the RE industry was doing to America over the last 5 years?

Comment by AdamCO
2008-04-11 13:13:42

any recession or depression is a fearcession. learn history. “all we have to fear is fear itself.” this fear isn’t irrational, though, which i think is what the guy was getting it.

Comment by Front Range Bob
2008-04-11 13:48:28

“any recession or depression is a fearcession. learn history.”

I believe it would be better to focus on the present facts, which are that the imminent severe recession will be caused by a burst credit bubble unlike anything in recorded history, and that consumers are cutting back on spending because they have no savings and are tapped out on credit.

Fear is a factor here, but a relatively small one.

Comment by Big V
2008-04-11 14:26:19

Yeah, it’s a bit of a factor for me. My husband and I are still employed and making the same $$ we were a few months ago, but I’m still starting to be cheaper becuase there are rumors of layoffs at his company, and rumors of a 2nd round of layoffs at mine. The fear is just a secondary factor; the actual decline in employment is the primary factor.

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Comment by Big V
2008-04-11 14:21:06

“Fearcession”? Now that is just one stupid term. Not cool, like “FB” or “Unrealturd”.

 
Comment by SaladSD
2008-04-11 17:18:44

Oh, the poor Wall Street cheerleaders just can’t get a break. That silly darn financial “mess” was supposed to be yesterday’s news, ponies and rainbows forever. Today the GE tooth fairy came and swiped their lolipop:
http://tinyurl.com/5nz3zt

 
 
Comment by Incredulous
2008-04-11 12:14:27

“The CPC group headed by Brits Nick and Christian Candy spent $500 million on a site the previous owner had purchased for $33.5 million just three years earlier. Their idea: build 252 condos and run away with a billion and change.”

Clearly something is very wrong here. To pay fourteen times what the previous owner paid three years earlier suggests way something beyond ordinary fraud. And do these hucksters really think they can sell hundreds of four million dollar or more (on avewrage) condos in one development? Where’s the FBI? Some incredibly stupid investors somewhere have been royally ripped.

Comment by Ouro Verde
2008-04-11 12:35:26

“fearcession”
Sure am glad it’s not a recession.

Comment by Faster Pussycat, Sell Sell
2008-04-11 12:50:32

fear-stag-de-flation?

I’m losing track of the tags now.

Comment by Big V
2008-04-11 14:28:09

Fecalflation.

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Comment by ET-Chicago
2008-04-11 15:01:53

Blech.

 
 
 
 
Comment by Mo Money
2008-04-11 12:55:26

The box of stupid must be enormous with these two.

 
Comment by Brian in Chicago
2008-04-11 13:58:44

Clearly something is very wrong here. To pay fourteen times what the previous owner paid three years earlier suggests way something beyond ordinary fraud.

The $500 million probably includes infrastructure improvements, zoning changes, a bit of construction, etc. It adds up.

Comment by WaitingInOC
2008-04-11 15:42:46

Those things do add up, but it seems hard to believe that they added over $400 million in value. Either we’re missing some facts or there is something very wrong here.

Comment by Hold out in LA
2008-04-11 17:10:59

Nope, it does not include any of that stuff. Just purchase cost.
http://la.curbed.com/archives/2008/04/9900_wilshire_p.php
It only just got city approval today after a $60 mill up front shake down. Designed by Richard Meier. OOOHH that’s worth $3mill right?
Just from Candy’s statements the 252 units would need to average $6 mill plus whatever it costs to build it. Good luck with that. In the words of Gen. Omar Bradley ” If if’s & but’s were Candy & nuts everyday would be Christmas”
Merry Christmas Mr. Candy.

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Comment by peter m
2008-04-11 19:51:36

“Just from Candy’s statements the 252 units would need to average $6 mill plus whatever it costs to build it”

They won’t be affordable units, thats for sure. Not in that area. Probably the most expensive RE on the west coast, as it would be next to the Beverly Hilton, Poinsetta Hotel, and the LA Country Club. Six- mil somewhat high & i don’t think that price will hold -even BH’s will have problems with the downturn in RE, unless they plan to import mega- rich oil sheiks.

Surprised that BH’s took that $60 mil in cash upfront to secure the deal? Cities everywhere need cash infusions to survive, even a city as rich as BH’s probably has cash flow problems as does every community in Scal.

 
 
 
 
Comment by peter m
2008-04-11 19:23:40

“The CPC group headed by Brits Nick and Christian Candy spent $500 million on a site the previous owner had purchased for $33.5 million just three years earlier. Their idea: build 252 condos and run away with a billion and change……..
“the proliferation of investment from non-U.S. citizens has buoyed the market to some extent. The extraordinary drop in the value of the dollar has effectively given foreign buyers a 30 percent discount on top property on both the East and West coasts.”

Here may be the clue. The bev hills RE investors are depending on rich cash- flush foreigners/ middle east-russian oil billionaires, rich Asians, ect. to prop up the ultra hi-end RE market in such areas as upper crust Manhatten and BH’s.

I know BH’s and indeed the golden triangle is a retail, banking, and professional services nexus for the ultra rich of the westside. Lots of well-off, car dealership-owning, middle easterners in BH’s . BH is a button down right-tilting bastion of hi-end lawyers, doctors and bankers , as well as the hollywood glamour crowd. Lots of old rich sepugenarians & octogenarians. It is also very safe: the BH police do not mess around and there is no PC tenderness there.

BH is over 50% apts and condos already :i wonder where they found space for 252 more condos- must be a vertical sky-rise.

 
 
Comment by ex-nnvmtgbrkr
2008-04-11 12:16:11

“‘Tell them exactly what your situation is,’ Supervisor Lou Calcagno told the distressed borrowers. ‘You got involved in a situation that wasn’t of your making. There’s only so much the government can do, but at least it can show you the way.’”

Not of their making?!!……….(slowly he turned and made his way to the JT locker)

Comment by Deon
2008-04-11 13:15:02

Yeah, that jumped out at me, too. That and the “government can show you the way.” That’ll work really great for this people. Look at what that’s already done for them!

Comment by WaitingInOC
2008-04-11 15:09:44

Always run away when you hear, “Hi, we’re from the government and we’re here to help you.”

 
 
 
Comment by SMF
2008-04-11 12:18:08

Matamoros and her niece often ask their relatives for help with the payments for the $620,000 home they bought only 13 months ago — a home now valued at $400,000.

OK, so my wife and I are (overpaying) for a very nice house at $575K. We are on the top 10% of earners. At $620K, we would have NEVER bought.

“Not all experts agree that the high-end real estate market will be
able to buck the trend of property value decline indefinitely.”

Smart experts.

Comment by Front Range Bob
2008-04-11 12:32:13

“OK, so my wife and I are (overpaying) for a very nice house at $575K. We are on the top 10% of earners.”

I would hope you made a very large downpayment, because it’s debatable whether just being in the “top 10% of earners” would allow a couple to comfortably afford a $575k house without one.

“At $620K, we would have NEVER bought.”

That made me laugh.

 
Comment by txchick57
2008-04-11 12:56:35

We’re in the top 5% and I’d never pay that for a house.

Comment by Front Range Bob
2008-04-11 13:39:14

Ditto.

 
Comment by Big V
2008-04-11 14:34:18

OK, I’ll play:

We’re in the top 2%. How’s that?

Comment by Big V
2008-04-11 14:35:37

Of course, that just means that we’re in like the top 25% for the Bay Area, but it’s still fun to say that. “I’m in the top.”

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Comment by Faster Pussycat, Sell Sell
2008-04-11 15:41:28

Contrary to popular belief, the Bay Areans don’t make that much money.

They think they do; they always do; but options were always a silly way to make engineers think they were getting paid but when in fact, probabilistically, they actually weren’t.

 
 
Comment by NYCityBoy
2008-04-11 15:15:00

“We’re in the top 2%. How’s that?”

I am Warren Buffett. Top that.

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Comment by az_owner
2008-04-11 16:29:44

I am the Sultan of Dubai.

 
Comment by ar
2008-04-11 16:58:55

hehe…

I am Carlos Slim!

 
 
Comment by sfv_hopeful
2008-04-11 15:22:40

We’re in the top 98%, and we’d never pay that for a house.

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Comment by peverilj
2008-04-11 20:10:06

I could never sleep well in a 620K house. At least, not if I had to pay the mortgage!

We made the responsible choice - we bought a house that we could easily afford, even if one of us lost our job. 120K income, 169K house. No granite countertops, no stainless steel applicances, no problem. Perfectly adequate and suits us fine.

I have absolutely no sympathy for FBs who took advantage of non-existant underwriting standards to buy homes that they simply could not afford.

I would love to have been at the closing table with the FB and her aunt. I bet they had no freakin’ idea what they were signing.

And I don’t mean no freakin’ idea in a taken advantage of kind of way. I mean no freakin’ idea as in dumber than a stump.

 
 
 
 
Comment by SMF
2008-04-11 14:57:16

Yes, the downpayment is very sizable. And we are ready to lose $100K in additional equity.

But there are other issues that make it feasible and better for us to move very soon.

FYI, this house sold for $415K in 1999.

 
 
Comment by SD renter
2008-04-11 12:18:31

I wonder if the plaintiff who lost is going to sue himself for selling his overpirced POS house in SanMateo to a FB.

Comment by phillygal
2008-04-11 12:51:43

“Marty and Vernon Ummels say that the $1.2 million price tag for the upscale coastal Carlsbad home they bought in 2005 could not be justified, especially when other houses on the street were selling for much less, vital information the couple said they didn’t get until after the close of escrow.”

all they had to do was ask for comps. And if they didn’t trust the realtor’s info, just look up the county records for comparable properties in their area. With so much money on the line, a couple or three hours of legwork was well worth it.

crybabies

Comment by Arizona Slim
2008-04-11 13:12:29

And, with so much of this info online, they could have done their searching from home. Or, if they needed assistance, they could have just gone to their local library. Reference librarians would have been happy to help.

 
Comment by Deon
2008-04-11 13:19:23

I’m actually surprised the realtors’ association didn’t side with the plaintiffs for one reason — they’re essentially conceding that a realtor doesn’t do anything but jack up the price to make a commission. No legwork, no honesty, no investigation, no assistance. That’s been painfully obvious, but aren’t these people trying to sell a service on the belief you’ll do better buying or selling through them than doing it yourself? And yet here they are saying you’re supposed to do it yourself, anyway, and pay them 6% of an inflated price for it. So what, exactly, are they supposed to offer?

(And, yes, I know the answer is “nothing.” It’s more of a marketing question.)

Comment by aimeejd
2008-04-11 14:05:08

I think that was the point the appraiser was making about this case being “lose-lose” for realtors in sense. Obviously, siding with the plaintiffs would have meant selling their fellow realor down the river; but by making the argument that he had no obligation to provide comps or guidance, they beg the question of exactly what purpose they DO serve. If I have to do all the research myself, what exactly am I paying this 3rd party that has interposed himself in the transaction for?

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Comment by Mike in Carlsbad
2008-04-11 16:02:20

which is why I am using redfin.com when I’m ready to buy.

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Comment by NotInMontana
2008-04-11 14:14:22

I take it this was a buyer’s agent? The stories didn’t say. Doesn’t that make a difference in the standard of care?

 
Comment by uptown
2008-04-11 14:47:01

So the RE industry has just made the case for not using a Real Estate agent. Good timing guys!

 
 
 
Comment by ex-nnvmtgbrkr
2008-04-11 12:19:40

“‘Is this a recession or a fearcession?’ he asked. ‘The subprime [mess] won’t submerge us. But if you watch too much 24/7 talking heads news, it will mess with your mind.’”

Ummmmm, I agree, the MSM sucks! But, if given the choice of listening to you, Mr Used-House-Salesman, or the MSM, I think the choise is obvious. Get out of my grill d*ckhead!

Comment by Front Range Bob
2008-04-11 13:41:37

I have to admit that these RE clowns occasionally have some humor value, if nothing else.

 
 
Comment by DinOR
2008-04-11 12:22:32

“It says the Realtors don’t have to do their due diligence”

Since when has there ever been any inference to the contrary? You’re on your own dude. Sorry Marty, if this guy in some way endeared himself to you and stuck you with a bigger price tag (and commission) then you’d imagined.

Yet another major victory for the REIC!

The NEW Teflon Don’s. Just try.. and make something stick to them! This is how the Cartel works baby. Start liking it. Well, THAT certainly was quick dashing of FB-void legal system. The precedent has been set. So forget about that angle FB’s.

 
Comment by aladinsane
2008-04-11 12:25:29

8 is enough…

“New-home prices fell for the eighth consecutive quarter to the lowest level since 2003. The Sacramento area’s median new-home price declined to $359,000 during the first quarter, a 7.5 percent drop compared to $388,000 in fourth-quarter 2007 — and $107,000 less than the peak two years ago.”

Comment by SDGreg
2008-04-11 12:51:20

“Sacramento real estate agents have long maintained that more than 40 percent of homes for sale in Sacramento County and West Sacramento are vacant.”

This is the stat that I found even more interesting and stunning than the price declines. Prices are headed much lower than 2003 levels.

Comment by Deflationary Jane
2008-04-11 13:21:54

Bingo!

What even more interesting is that we still the occasional investor buying for rentals. With that many vacancies, more inventory being built, and large outmigration pressures now that the state is cutting jobs, where do these ‘investors’ think the renters are going to come from?

 
 
 
Comment by taxmeupthebooty
2008-04-11 12:26:36

ARISE ! big gov will “show you the way”
You got involved in a situation that wasn’t of your making. There’s only so much the government can do, but at least it can show you the way.’”

Comment by oxide
2008-04-11 14:07:23

Showwwww me the waaaaaay….
Showwww me the waaayyy….
Take me tonight
to the river and
wash my illuuuuusions awaaaaaaayyyyyy….

 
 
Comment by txchick57
2008-04-11 12:41:35

“It took a jury less than two hours Thursday afternoon to unanimously clear a real estate agent accused of failing in his duties to a couple he helped buy a tony Carlsbad home.”

I believe I saw this one coming & anticipated the outcome when the story first was published. Nobrainer, the realtor wasn’t going to get tagged. That kind of case is a big loser.

Comment by txchick57
2008-04-11 12:49:55

I would imagine it was a tough sell to a jury in San Diego to feel sorry for someone with a million dollar house, even if they overpaid. LOL

Comment by scdave
2008-04-11 13:09:31

Here is a realtor suit that is now ongoing (I know the realtor)…Buyer of house after rate ajusted on the loan sues, realtor, Title Co., and Lender….Realtor is already in the deal 55k in his defense…Title co. offered buyer 100k if they would let them out of the suit…Lender offered buyer new fixed rate 30 year loan @ 5% fixed…Buyer turned all of it down…

Comment by Big V
2008-04-11 15:01:31

What is the law on that, anyway? Is the lender under an obligation not to change your rate during a certain time period? There should be something like that.

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Comment by SaladSD
2008-04-11 14:08:15

Yeah, Carlsbad has been selling it’s soul as the haven for aspirational tract houses, big box stores and Hummer-lovers. Yet another battle over a super WalMart is being waged on a lovely pasture with an honest-to-goodness 100 year-old wood barn.

 
 
Comment by DinOR
2008-04-11 12:54:40

You had to know this couple was not only peeing up a rope but probably one of many angles they were trying to recoup their long gone dollars. I imagine they were pecking away at their lender for a principal reduction and squirming every which way they could. Multi-pronged attack.

Comment by phillygal
2008-04-11 13:02:06

Peeing up a rope…can you do that when you’re brain dead?

I read their comments and it sounds like they never asked for comps. Can that be? The first thing I did when I was selling my house was ask for comps. That was an eye opener in itself.

 
 
Comment by SD_FotBotD
2008-04-11 14:05:08

Is it wrong that I was hoping that somehow both sides would lose the case?

 
 
Comment by Saint Barbara
2008-04-11 12:43:26

OT–
Santa Barbara’s downtown industrial district is, inch by inch, yielding to luxury townhome developments, which, despite appearances, are hardly immune to foreclosure. And how much is a $1.2M condo next to the 101 Freeway worth, anyway? This week at the Santa Barbara Housing Bubble Blog: find the foreclosure, and win a free Santa Barbara home!

Good luck!
Saint Barbara

 
Comment by ChillintheOC
2008-04-11 12:49:12

Marty Ummel said. ‘I believe it’s the agent’s responsibility to do his due diligence and inform his clients of any material fact that would impact their willingness to buy or not buy.”
———————————————————————————
Not to defend the REIC, but buyers weren’t exactly sharing their RE “gains” with anyone on the way up. Why should it be any different on the way down?

Comment by txchick57
2008-04-11 12:57:52

Well, Marty . . . . you believed wrong. Deal with it.

 
Comment by svcodemonkey
2008-04-11 13:19:23

yet another person put the ‘blame’ on someone else instead of himself. I guess he won’t say a thing if the RE keeps going up.

Comment by Big V
2008-04-11 15:07:23

I dunno. I think the buyer’s agent ought to have a fiduciary duty to their client. I realize that legally they don’t, but if the agent recommended an offer price to the sellers that was unjustifiably high, then I think he’s guilty of fraud. That’s just the way I see it, but I know the law disagrees. This is just another reason to limit your resources to:

a) A real-estate attorney
b) Internet sites such as Zillow.com
c) Your librarian (as mentioned above)

With the help of those 3 resources, you should be able to manage the entire transaction sans RE agent.

Comment by are they crazy
2008-04-11 16:31:29

I read in one of the articles that the plaintiffs were trying to compare apples to oranges - that the other houses that sold for $100K less were not comparable.

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Comment by DinOR
2008-04-11 13:34:38

Chillin,

That’s one way of looking at it but I tend to think that there was as much musical houses as there was “up”. The NAR generated $60 bil. (that’s billion w/ a “b”) in comm. for 2005. I…. think sellers were sharing puh-lenty profit with the NAR. Not to mention REIC affiliates, title, appraisal, MB etc. To be sure realtors were tracking the homes they just sold to see if there was enough “up” to get their client to move again.

Now true that’s an awfully difficult thing to prove in a court of law but this should have been disciplined at the company level and made right by the client at the company level. Then again I have a securities background and by us it’s simply an assertion of guilt by the client to the firm and then you had BEST be well prepared to explain and support your actions. IMHO

 
 
Comment by NoSingleOne
2008-04-11 12:49:32

“‘Is this a recession or a fearcession?’ he asked. ‘The subprime [mess] won’t submerge us. But if you watch too much 24/7 talking heads news, it will mess with your mind.’”

NY Times Headlines today:

Frontier Airlines has declared bankruptcy…the 4th airline to fail in the last 2 weeks, a victim of high fuel costs and the credit crunch.

‘Linens ‘n things’ is pondering bankruptcy protection.

G.E. profits, considered a very reliable earner, now down 5% in Q4 ‘08

Consumer Confidence Wanes (26 year low); Import Prices Rise

Gas prices are at an all-time record high of 3.36/gallon.

Comment by mikey
2008-04-11 14:41:37

Glad the NY Times is printing stories like this. I’m in a Milwuakee area suburb and you heard the impending Joe6pac Crunch Time daily.

I swim laps at the Y and am bugged by RE agents posting their business cards on the bulletin boards and trying to get chit chatty in the locker rooms. They are totally desperate and many of them drank their own koolaid and are stuck with their own investment houses. I try not to snicker as i’m sure they would love to get me at the deep end of the pool after my comments:)

The Milwaukee local TV news has been running a story about special assessments for alley concrete repairs in one town. The homedebtors are getting hit with alley repair bills of $5000-$7500 for concrete work on their share of the alleys. The newer FB’s are in a rage of the hidden cost when they bought and a 82 yr old guy was hit with the near 8k estimate.

Forget the alleys. If you dare drive anyway in SE Wisconsin for a week, chances are you’ll need a front end repair or worse.

Big bills are coming due for families, cities and the Taxpayers.

Two years ago, the Milwaukee area was gleefully jumping up and down because assessments indicated that their houses were “Worth Mo Money”.

Now their jumping up and down because everying from the roads to infrastucture is falling about …and SOMEBODY is going to have to PAY :)

 
Comment by uptown
2008-04-11 14:57:34

Headlines are usually useless for business news.

Frontier - “said it was forced into bankruptcy after its principal credit card processor, said it would begin withholding a greater share of proceeds from ticket sales.”

Linen n Things and GE - The chain, owned by Leon Black’s buyout firm Apollo Global Management, is negotiating with creditors, which include General Electric Co, the source said (GE is in for $700 million)

Import Prices Rise/Gas prices - dollar went down fast, what did you expect?

 
Comment by bangkokobserver
2008-04-11 23:40:40

I’d really like to know who Frontier’s credit card processor is. Sounds like that financial institution is the one in need of immediate crash, given the short notice that they gave Frontier on their intention to do this.

Comment by rex
2008-04-12 09:38:25

First Data based in Greenwood village, Denver, did the dirty deed. When you have nice friendly local business connections why worry about distant enemies? Talk about shooting yourself in the foot!!

 
 
 
Comment by Rally
2008-04-11 12:55:12

“Cranes tower over the desirable parts of L.A. and the real estate market is primed for the sale of the 29-bedroom, 40-bath …”

Why so many bathrooms? Do the rich have more anuses than the rest of us?

Comment by Mo Money
2008-04-11 13:02:38

maybe they are just more full of Sh*t than the rest of us

Comment by Arizona Slim
2008-04-11 13:15:23

Or they’re more p1ssed off than the rest of us.

 
 
Comment by In Colorado
2008-04-11 13:16:10

It could take a whole day to clean all those toilets!

Comment by SDGreg
2008-04-11 16:34:06

All with legal, domestic labor I’m sure.

 
 
 
Comment by aladinsane
2008-04-11 13:01:08

In retrospect, it was probably wrong to call the new development, Werewolf Ridge Estates

“‘I don’t think there is a simple answer,’ he said. ‘There’s no silver bullet.’”

Comment by bayparkwatcher
2008-04-11 13:52:16

Last year, they were heavily advertising (here in San Diego) a new desert resort community with the horrible name “Coyote Wash.” Ugh. It’s out near Yuma.

 
 
Comment by dude
2008-04-11 13:02:00

http://www.avpress.com/n/11/0411_s1.hts

Story on auction in AV. I thought it was quite fairly reported, not alot of REIC shillery. Still have invisible reserves according to this story.

 
Comment by JohnF
2008-04-11 13:15:23

“DataQuick’s Andrew LePage said banks have sold only about 40 percent of the homes they foreclosed on in the region during the second half of 2007. The thousands more slated for sale will put a downward pressure on prices. ‘There are just a heck of a lot of foreclosures to burn off before the market can kick into gear in any big way,’ he said.”

Someone help me with the logic here. I would assume that people would have to purchase the foreclosures in order to “burn them off”. So after that, where is the next huge group of buyers that are going to help the “market….kick into gear in any big way”?

Are there tens of thousands of people “sitting on the fence” waiting to buy all the houses after the foreclosures are all soaked up?!? If so, where is this fence? It must be huge!

I’m not sure there are enough buyers to purchase all of the foreclosures. Who is going to purchase them, the people that just lost them to foreclosure?

I am very confused…..

Comment by phillygal
2008-04-11 13:28:43

So after that, where is the next huge group of buyers that are going to help the “market….kick into gear in any big way”?

This is the fatal flaw in the most excellent plan of the Foreclosure Seminar Gurus. But their devoted followers don’t seem to comprehend the danger.

(Because they are not pessimistic fence sitters and talking the market down, they are forward thinkers and WINNERS)

 
Comment by DinOR
2008-04-11 13:37:47

JohnF,

IIRC LePage used… to work for the SacBee until he was hired away by DreamQuick (I mean DataQuick damn it) and he hasn’t gotten the spin down quite yet. Evidently Both Marshall Prentice and John Karevol were out with a badly sprained tongue.

Comment by Big V
2008-04-11 15:13:54

“Badly sprained tongue”.

Har!

 
 
 
Comment by hoz
2008-04-11 13:24:45

Rescue Mission Turns 100 Homeless Back To Streets
Homeless Center Claims Lack Of Adequate Care Prompted Downsizing

BAKERSFIELD, Calif. — Last week the Bakersfield Rescue Mission laid off at least 15 workers. Tuesday the facility shut out at least 100 men.

Men living at the Rescue Mission said they’ll have to hit the streets if there are no beds for them….”
turnto23 . com

Another NFP bites the dust. I would rather have the homeless in a shelter than in the streets, but there are a lot of vacant houses to seek shelter.

Comment by Arizona Slim
2008-04-11 13:51:17

True story: A college friend has an office north of downtown Ann Arbor, Michigan. Across the street is the shell of a Greek Orthodox church that was slated for conversion to residential/commercial development. But the project went bust. My friend says that the building is now a homeless encampment.

Comment by aladinsane
2008-04-11 14:03:52

Welcome to the Bush Leagues…

 
 
 
Comment by aladinsane
2008-04-11 13:28:38

“‘They took the lighting, the copper and the air conditioner. It just takes 50 percent of your equity overnight,’ she said.”

Anybody care to hazard a guess how much money the thieves got for their troubles, ruining a perfectly good house?

I’m thinking they got around $386 for their efforts…

Comment by FreedomLover
2008-04-11 14:01:06

Welcome to the Great Depression 2.0. Soup & bread lines here we come. Hoovervilles will make a return… Except they’ll call them Bushvilles in the history books.

Comment by Big V
2008-04-11 15:16:32

Except that today’s Hoovervilles will actually be brand new housing developments in desert areas instead of tent encampments.

 
 
Comment by DinOR
2008-04-11 14:18:02

Well exactly. The A/C unit was cannibalized just for the copper tubing in the condensor. Scrap weight of course. Then again, it wasn’t like anyone else had much use for it in the immediate future?

 
Comment by ric
2008-04-11 14:25:10

You’re probably right, but to them, it’s $386 more than if they just stayed outside and did nothing,

“Gee Beavis, that’s a nice house. I could never afford something like that. Do you think we should go in there and rip all the plumbing and fixtures out so we can get some more booze, or do you think we should leave it alone so one of those rich fat Carlton Sheets geniuses we see on TV at 3 in the morning can buy it and get even richer and fatter?”

 
Comment by jbunniii
2008-04-11 23:03:35

$386 is a lot of money - probably more than the average FB has in his savings account, if he has one.

 
 
Comment by aladinsane
2008-04-11 14:01:33

Orwells Fargo double-speak

“Speakers delivered a mixture of good and bad news at the Greater Fresno Area Chamber of Commerce annual economic reporting conference. The keynote speaker, Gary Schlossberg, senior economist at Wells Capital Management, said he thinks the country has entered a recession but doesn’t believe it will be particularly deep or long.”

 
Comment by Mike
2008-04-11 14:15:33

It would be really nice if more FB’s sue their realtorwhore(s). They might not win but the realtors are going to spend big bucks on lawyers defending the case. As someone remarked to me a few days ago, “Do you realize these botox injected realtors doubled their incomes (commissions) in just a few years. They were overpaid before the boom but I don’t see anyone talking about how much their incomes have increased in just 5 years.” I really don’t wish for much in my old age but seeing scores of realtorwhores having to re-finance their property to cover the costs of defending themselves in court is top of my list.

 
Comment by the_economist
2008-04-11 14:29:25

“‘It went down to $125,900,’ Del Brocco said. ‘I offered $100,000. They came back at $118,000. I came back at $114,000, and that’s what I got it for. It’s the cutest house.’”

The strangest thing happened. I woke up and my right hand was all bloody. I had a large cut down the middle of my palm. I dont know how I got it.

 
Comment by Mike in Carlsbad
2008-04-11 14:42:31

Now San Diego industry is crying that there are not enough young people to work for them, I wonder why?

http://tinyurl.com/3lbba8

Comment by Big V
2008-04-11 15:23:24

I heard this academic guy recently talking about the number and caliber of math and engineering graduates coming out of US institutions. He said that the US produces more than any other country, and that our graduates are of a higher caliber by every measure. So why the worry? I think the worry comes in when we start interviewing high schoolers and we realize that not many of them plan on going into math or engineering because they see those jobs being offshored or filled by foreigners who work for less. As long as wages in those fields are stagnating (and how), the younguns amongst us will not do the major.

 
Comment by Deflationary Jane
2008-04-11 15:37:38

Repeat that story over and over again in CA. The young minds won’t come here, they are too smart and know better. The best you can do is hope to recruit the few locals left and be prepared to pay through the nose for them. I see this all the time as we try to hire faculty from out of state.

 
 
Comment by Mike in Carlsbad
2008-04-11 14:48:30

Broker cleared of selling home that buyer says was overpriced

SAN DIEGO (Map, News) - A jury has ruled that a real estate agent did nothing wrong when he brokered the purchase of a $1.2 million home in Carlsbad that the buyer says was overpriced.

Marty and Vernon Ummel argued that they never would have bought the 3,700-square-foot house in 2005 if their agent told them other homes on the same street were selling for more than $100,000 less at the time.

The Superior Court jury took less than two hours Thursday to reach a unanimous verdict. Jurors found that broker Michael Little was not negligent and did not breach his fiduciary duty.

Little said he was relieved but that his business has struggled since the lawsuit was filed in 2006. The Ummels said they have no regrets about suing.

Information from: The San Diego Union-Tribune, http://www.signonsandiego.com

 
Comment by txchick57
2008-04-11 15:33:18

Here’s one for the fruits and nuts in Clownifornia. Also for fflatplan if he’s still around

http://online.wsj.com/article/SB120787129943306485.html?mod=loomia&loomia_si=t0:a16:g2:r2:c0.0848577

Comment by Big V
2008-04-11 17:38:03

Texas Chick:

Just letting you know that Californians think of Texans as being obtuse and obnoxious.

Also, please realize that we would like everyone to pay their fair share. We do not wish to have the entire burden of society placed upon the shoulders a few socially minded people. As long as the bridges are falling down and the domestic-abuse shelters are being closed, then I don’t think it’s right for people like you (who hide their large incomes from the IRS) to poke fun at tax-paying citizens.

Comment by spike66
2008-04-11 19:06:07

“I don’t think it’s right for people like you (who hide their large incomes from the IRS) to poke fun at tax-paying citizens.”

I don’t think there’s any reason to accuse Txchick of this…and it is a very serious accusation. Refusing to pay a penny more than you are legally obligated to pay is every citizen’s right, as is arguing with the IRS over particular deductions or credits.

 
Comment by Mole Man
2008-04-11 20:21:41

Well, California is a silly place. That’s part of why I like it.

“There is science, logic, reason; there is thought verified by experience. And then there is California.”
- Ed Abbey

And his tag was was “flatffplan”, but even he forgot that after a while. Now he’s “taxmeupthebooty” or something like that. If anti tax rhetoric extended to such things as wars, veterans benefits, and imaginary space shields that can’t possibly ever work then I’d be all for it, but apparently none of that stuff is on the table. The flat tax thing sounds good to me.

There are actually several things I like about this bubble. One is that it resulted in a bunch of housing units being built in and around the San Francisco bay area where development had tended to stall out, but the other is that people are finally beginning to question the mortgage interest tax deduction. Getting rid of that, even phasing it out over generations, could make a real difference especially over time.

If California gets enough blood in the streets then there will be poppies everywhere the following spring.

 
Comment by James
2008-04-11 21:44:16

I think Alabama or Georgia did this already. They got like one or two checks. One from the sponsor and a two dollar check from somewhere.

 
 
 
Comment by t.ryan
2008-04-11 17:22:26

Several lessons:
1) No one can afford a decent house in California. Anything less than 400$ appears (as seen on Home TV) to be a POS.
2) incredibly tough times are coming for all those people I envied with their SUVs, McMansions, and Plasma TV. How could they afford them I wondered?
3) ANSWER: they bought them all on credit!!!
4) Llive like no one else now, so that in several years you can live like no one else!! (not mine, but Dave Ramsey, who like a latter day Churchill is seeing his predictions come so horribly true!

 
Comment by Professor Bear
2008-04-11 18:07:47

“The case attracted national attention as it posed a hot question: What are the responsibilities of a real estate agent?”

Let me guess: To tell their clients, “California real estate always goes up”?

 
Comment by Nozferatu
2008-04-12 00:01:21

Has anyone seen that monstrosity called the AMERICANA in Glendale, CA? Have you folks seen all the housing they have built inside this place? It’s so gaudy it makes me want to vomit.

I don’t know how much they are asking for these luxury condos/townhomes, suites but I’m sure they are going to be ultra expensive. I can’t imagine who’s going to buy them in this market.

 
Comment by SdGuY
2008-04-12 01:08:44

“It’s so gaudy it makes me want to vomit.”

http://www.americanaatbrand.com/

Try reading the brochure on pdf file.The intro is kinda lame.

Hundreds of apartments and townhomes.A movie theatre and tons of retail shops.

 
Comment by Nozferatu
2008-04-12 18:35:30

Why don’t these people EVER…EVER..put prices on these damned things? Is this a universal scam approach?

 
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