Sun 6 Jan 2008
Preliminary December sales and inventory data for Northern New Jersey is in. Please note that this data is subject to revision.
The first graph plots the unadjusted sales data (closed sales) for the counties listed. Please note the lower bound of the graph, it is set to 1000, not to zero. I do this to emphasize the seasonal nature of the Northern NJ market.
(click to enlarge)
The second graph is another view at the sales data for the full year. Please note that this graph does cross at zero.
(click to enlarge)
The third graph displays only December sales, 2001 to 2007 YOY.
(click to enlarge)
The fourth graph displays an overlay of Sales and Inventory from 2003 to 2007.
(click to enlarge)
The last graph displays the year over year change in inventory on a monthly basis.
(click to enlarge)
Contracts are ugly.
Contracts Data (XLS)
December contracts are the worst showing of the year, down 32% over December 2006. Given the trend in contracts from mid-year, it is clear that the downturn has begun to reaccelerate. First quarter contracts were extremely positive at -0.2%, however that positive trend didn’t continue, Q2 contracts were down 3.4%. By Q3, it was clear that the market was beginning to deteriorate again as contracts fell 12.5% year over year. Fourth quarter? Down 23.7%, with some counties seeing contracts fall by close to half.
No recovery in sight.
Grim,more important than the the real estate market and the election news and perhaps the Giants beating Tampa is that after a visit from US television therapist Dr. Phil, Britney Spears checked herself out of Cedars Sinai Hospital.
Brit’s mom and dad are scheduled to appear on his show Monday or Tuesday and Dr. Phil wants to do a “television intervention” with Britney. Britney’s people say it will be a “cold day in Hell” when she appears on his show.
I am now adjusting my Britney death pool from August 2008 to Memorial Day Weekend of 2008.
How about an exacta for Britney and Amy Winehouse?
If Britney goes bye-bye, maybe, just maybe, the US general population will wake up and realize just how insane the culture of celebrity worship has become.
Those graphs are scary if you’re in the business of selling homes or lending people money to buy homes. Good thing I’m looking to buy during 2Q 2008, and I have my safe, reliable Big Pharma job to rely upon.
Wouldn’t be surprised to see a slight uptick next month. Some people seem to be jumping in thinking they are getting deals.
“I have my safe, reliable Big Pharma job to rely upon.”
Are you trying to be IRONIC????
I see some Brand Name Prescription Drugs like Norvasc rising monthly, price wise. Maybe John Edwards is right, if we forbid them to do direct advertising, the prices will drop dramatically. I’m beginning to believe him, that TV Ads cost more then R&D.
Wall Street Eyes Housing, 4Q Earns Data- AP
The start of 2008 has brought a harsh reality to Wall Street: The U.S. may indeed be headed toward recession. So, after suffering punishing losses the first three trading days of the year, the stock market will be seizing on any data or forecast in the coming weeks that can help investors determine if their worst fears are coming to pass
I’ve noticed that the price of just about everything has gone up. Eggs, milk, and dairy have all increased by at least 10% over the past few weeks. My local A&P sold their bakery donuts for 49 cents, now try 59 cents. The cafeteria at my stable, rock-sold pharma employer (sarcasm detectors should be going off) raised prices from 20-50% on most items as of Jan. 2nd. Even deodorants are approaching $4 for a mass-marketed brand; they rarely cost more than $2 for a while. Are we witnessing inflation or has the effect of oil flirting with $100 for most of 4Q 2007 started to kick in?
There seems to be quite a disconnect between inflation effecting the General Population and inflation measured by the FED. Imagine if the Cost of Houses increase between 2003 - 2006 was still included in the Inflation Index. They would have to make the interest rates 500%.
#2 Sean, you seem to have an excellent grasp of the really important issues of our time, however, I will bet you $100 right now that Britney makes it through 08. Celebrity drug/alcohol deaths (including from car crashes) are pretty rare these days. I’ll throw down another $50 to bet you that she makes it through 08 without flashing her no-no special place for the cameras.
re: (6) Confused.
John Edwards during the Democratic debate last night did well, and he had allot to say about the middle class that I found appealing.
The next debates scheduled are Vegas on the 15th, Myrtle Beach on the 21st and Hollywood on the 31st.
As the candidates will no longer be pulling punches, we can expect some flubs that the press will pick up on. Heading into Florida, Michigan and super duper Tuesday Edwards could upset the democratic party.
Big money may even head towards his campaign away from Hillary.
re: (8) jmacdaddio
Coffee and gasoline, you can expect huge increases.
Check out this scam.
Paper towels, ny inflate-O-meter, are now appearing at the local grocery store out of their packaging. The store is buying larger packs, ripping them apart, and selling them as single rolls.
Hello All,
I have been reading your blogs for the last few months.
We bailed out of central NJ (Hillsborough) in September, 2005. We couldn’t bear to own 2 depreciating properties any longer and we chose to move to Key West. It was a tough decision to make but it turned out to be the right choice. So far so good.
Regards,
Key Wester
MLS Number: 2380546 in Summit with Property Tax of $69,426. Wonder how much income you would need to not care about property taxes of $69,426. I guess if you were the Osmonds, income and number of kids in school, might do it.
Eff the Barber brothers… and eff Tony Romo. I hope Strahan and Umenyora knock his block off.
1
14…..Key wester…..Welcome to the madness. I must admit — I HATE YOU!!!! OK, I say that with jealousy. I would simply love to be where you are 24×7……– enjoy it.
“Wouldn’t be surprised to see a slight uptick next month. Some people seem to be jumping in thinking they are getting deals.”
lisoosh[4],
I agree. A dead cat bounce is imminent, similar to 1990-1991. A stimulus package is forthcoming. A campaign; “Save the Housing Market”, buy housing bonds will be introduced. This in combination with falling prices will entice many. The news will be bombarded with reports that the bust is over. The market will lift its decimated head, for a few months, before continuing its decline.
Confused In NJ Says:
January 6th, 2008 at 6:30 pm
Imagine if the Cost of Houses increase between 2003 - 2006 was still included in the Inflation Index. They would have to make the interest rates 500%.
Actually, the housing bubble has actually ended up under reporting inflation. Rents (the largest component of CPI) were kept artificially low due to the increase in homeowners and excess housing inventory.
“Are we witnessing inflation or has the effect of oil flirting with $100 for most of 4Q 2007 started to kick in?”
Rerun, 1976-1980. Money supply has been increasing approx 12-14%. Unfortunatey, it has not resulted in producing goods which the world desires. Port Newark is long on empty cargo crates. However, we have been experts on exporting inflation.
How can we continue to lose manufacturing jobs while the dollar is getting pummelled? The increase in money supply, if not producing goods, results in artifically increasing asset prices and pushing up prices of goods and services. Inflate in 08′or stock up the apple carts.
4#, 19#, this will not a dead cat bounce. as i said here many times, the recovery will be fierce once people realize that the re bubble bust is just like that. here is a little anecdotal evidence:
“I put two offers on homes in Princeton Collection this month. First offer was 10% belows asking and I was outbid. Next offer was 5% belows offer and was outbid. I now have offer in at full asking price and told that other buyer will offer more. My question, how much over asking price should I offer for Princeton Collection homes? There are not many left. No more buyer market?”
FYI, pricenton collection is a lower end single family home community in plainsboro township with price range around $450K
bi, I guess you missed the charts at the beginning of this thread……..
Its a disaster out there.
jmacdaddio Says:
January 6th, 2008 at 6:08 pm
Are we witnessing inflation or has the effect of oil flirting with $100 for most of 4Q 2007 started to kick in?
jmd: the oil is part of the story, the rest is f- congress giving a financial incentive to use corn for ethanol….a complete waste and huge handout for no good reason. As a result, corn is diverted from its pure use in consumer goods and livestock feed. Add on additional demand from emerging markets and you can see the reason. Finally, all of this ETF/hedge fund nonsense has drawn in more actors to the market to inflate the cost of these products beyond even the rich fundamentals.
To be clear, the ethanol piece is what sticks in my craw, because, if I understand correctly, corn-based ethanol is inefficient, is an energy hog to produce, and is expensive.
James, at the rate things are going, soon you won’t have to have charts where the lower bound is greater than zero.
Key wester - great and all that, hopefully you will not live to see the sea rise over your front doorstep or perhaps a killer 5 swamp your home in the next decade.
Really after seeing some of the option arm reset data, for the nation, subprime peaks this summer and all other mortgages peak in 2009. I think we won’t see bottom until 2010.
Yeah, this is definitely getting uglier.
Removing Home Ownership Costs from the CPI
It is common knowledge that the homeownership component of the CPI consists of owner’s equivalent rent instead of the real cost of homeownership. As described in this New York Times article, this was done back in 1983, for what some would say were dubious reasons:
Until 1983, the bureau measured housing inflation by looking at what it cost to buy and own homes, considering factors like house prices, mortgage interest costs and property taxes. But given the shifts in interest rates and housing prices, those measures could show big bounces from month to month. Besides, homes are a strange hybrid of a consumable good and a long-term investment. As part of a long-running evaluation, the bureau wanted to “separate out the investment component from the consumption component” of the housing market, said Patrick C. Jackman, an economist at the bureau.
Not coincidentally, taking home prices out of inflation reporting seems to have had a very calming effect on reported inflation, as can be seen in the chart below. The effect has been particularly calming in the last seven years.
Click to enlarge
Note the relationship between CPI and home prices before and after 1983. It is clear that there is an entirely different relationship between the two before and after this time.
From 1976 (when OFHEO data first became available) to 1983, there was a clear relationship between the two - a one or two year lag between changes to home prices and changes to inflation, according to this chart.
Since 1983, home prices and inflation have mostly gone their separate ways. At times there has been a distinct inverse relationship between the two, as can clearly be seen during the housing boom and bust of the late 1980s. During this time, initially home prices rose as inflation fell. Then, when that housing boom went bust in 1990-1991, inflation ticked up noticeably.
This is significant and, no doubt, driven by the same dynamic that has been evident in recent years - as home prices rise, homeownership rises and demand for rental housing wanes, therefore depressing rental prices and ultimately putting downward pressure on the CPI. When housing cools, this process works in reverse - higher demand for rental housing, and upward pressure on the CPI.
This is an ominous sign for today’s economy where housing now appears to be cooling - if home prices stagnate or decline, the impact on rental costs, and hence reported inflation, could be quite significant (it is natural to wonder whether, in this scenario, those calculating inflation statistics would deem it prudent to put real homeownership costs back into the CPI, replacing rising owner’s equivalent rent).
Back to the Core
So, a natural question to ask, given all the discussion of inflation over the weekend, is “What if homeownership costs were to once again be included in the inflation calculation?” Home prices have clearly become “disconnected from their moorings” of rental prices, to borrow a phrase from Fed Chairman Alan Greenspan - maybe it’s time to include them again.
In light of the discussion of “headline” inflation vs. “core” inflation, it is natural to ask, “What would core inflation be today if home prices were included?” Core inflation excludes food and energy, but it does include housing.
Your answer:
5.3%
Yes, that’s right - almost triple the 2 percent core rate of inflation that has been hammered into the nation’s collective consciousness over the last ten years, and particularly over the last few years.
Using publicly available government data, here is how that number was calculated:
According to the BLS (warning, PDF), owners’ equivalent rent of primary residence makes up 23.1 percent of the All Items index. Since food and energy make up 22.2 percent of the total (14.3% food, 4.0% housing fuel, 3.9% motor fuel), then as a percent of “core” inflation, owner’s equivalent rent is:
23.1 /(100 - 22.2) = 29.7 percent
Also per BLS data, core inflation for the last twelve months has been 2.0 percent while owner’s equivalent rent was 2.3 percent. Before we can calculate a new core inflation rate using homeownership costs, we first solve for the core inflation rate exclusive of owner’s equivalent rent:
(70.3% other core components * x percent) +
(29.7% equivalent rent component * 2.3 percent) =
2.0 percent core inflation
x = 1.87 percent
Now, using the 13.43 percent increase in home prices from Q2-2004 to Q2-2005 as reported by the OFHEO, and as quoted by Fed Governor Susan Bies just the other day, substitute for owner’s equivalent rent and calculate core inflation anew:
(70.3% other core components * 1.87 percent) +
(29.7% equivalent rent component * 13.43 percent) =
5.3 percent core inflation
It seems that including homeownership costs instead of owner’s equivalent rent in the calculation for core inflation gives it an entirely different feel.
Notes:
While admittedly quite important to homeownership costs, interest rates and property taxes have been omitted from the above calculations. The reason for doing so is that mortgage rates have been flat over the last year, the time period applicable to this calculation, and property taxes generally scale with home prices. For this period of time, the change in home price alone is representative of the change in home ownership cost.
OFHEO housing price data from Q2-2005 is used here, as no subsequent data is yet available. The inflation data from the BLS is from Q3-2005, however, this misalignment is not expected to result in any significant change to the calculated results, as the OFHEO data has been fairly consistent over the last five quarters, ranging from 10 and 13 percent, and trending up.
A similar calculation for headline inflation yields 7.3%.
Sean,
Our house is built to the latest construction standards and we won’t stick around for major storms i.e, categories 3+.
Hey, we managed to survive Huricane Floyd up in NJ. As you may recall, that storm took out much of central jersey. :-)
Key Wester
Inflation? No, stagflation - a slowing economy, job losses, wages not keeping up with inflation, prices at the grocery store going up on a daily basis and the pervasive feeling that everything is inexorably slowing to a halt as our surroundings begin to show signs of decay from neglect. The last round of this in the seventies was pretty bad but I have a feeling that this one might be worse.
If you throw enough tax dollars at corn, you can get ethanol! It’s far more efficient to make it from sugarcane. Ethanol from corn is a complete waste. After accounting for the fertilizer made from fossil fuels, the diesel used to power the farm equipment, etc. trying to get energy independence from ethanol derived from corn appears more and more foolish (resisted urge to say fuelish).
The sad reality is that biofuels are putting more pressure than ever on rainforests. We’ll have to choose between food, getting around, or preserving the climate. We could all become vegetarians who don’t go anywhere I guess.
In the short run, like chicagofinance, I expect prices on just about everything to rise. It’ll be interesting to see what happens to house prices in far-flung exurbs when gas hits $5 a gallon in a couple of years.
Lowball is currently in progress, should be done in an hour or so. Bergen (GSMLS) is currently posted, more to follow.
Confused in NJ,
Thanks for posting that. I wouldn’t be surprised to see home prices included again in the near term so they can show lower inflation (from deflating prices) in order to support more rate cuts.
33.Hobokenite
You are probably right, but point still is CPI reading is low, compliments of Alan Greenspan 1983 manipulation, to reduce COLA for entitlement programs.
Grim,
One of your lowballs is also, not surprisingly, a comp killer.
2426297 Berkeley Heights Twp. SP$ 525,000
was sold in April 2005 for $595,000
BC (19)-
Where’s the dead cat? I don’t see it.
January & February were the two best months of ‘07. I doubt that will be the case this year.
The next month of decent sales volume will be triggered by widespread seller capitulation. It cannot come soon enough.
From Reuters:
Credit Suisse shares fall on report of writedowns
Shares in Swiss bank Credit Suisse fell by around 3 percent on Monday after a Swiss newspaper reported the bank faced writedowns in its commercial mortgage and leveraged-finance business.
Credit Suisse has until now emerged relatively unscathed from the U.S. subprime mortgage crisis which has forced many banks, including Credit Suisse rival UBS, to make huge writedowns.
Jmacdaddio
I have my safe, reliable Big Pharma job to rely upon
I hope you are kidding. Big pharma in NJ is not a safe place. It may be more secure then mortgage or finance fields at the moment, but it is a long term dying industry in the state
Grim, (#37)
I have a small - $200.00 a mo. from check-403B TSA (since 2004) with Pacific Life that runs through UBS Financial Services in NJ. Is that a problem? I hate 403Bs because they limit what sort of vechicle/who you can work with but it is the only way I can deal with that $1,000. I get from Oregon.
Cindy
Ooops, sorry - I should not have asked anything financial. (#39) I DO NOT want to
spark any conversation. It was just that your passing comment RE UBS write downs (#37) caught my eye.
Cindy
Clot,
From lowball. Do you know what this property is like? 340K in Peapack/Gladstone?
2392687 Peapack Gladstone Boro $499,000 $399,000 $340,000 31.9%
$159,000
By the way, great win last night. NC/Kansas in the final. Maybe semi’s, depending on brackets.
From the Asbury Park Press:
An alternative to foreclosure
Y our adjustable-rate mortgage has reset and you can’t afford the higher monthly payments. In a sluggish real-estate market, the property isn’t worth the same as the day you bought it. What’s next?
For homeowners and lenders who share a devalued asset, the answer may be a short sale.
Short sales are deals between borrowers and lenders to sell a house for less than what is owed on the mortgage. Some in the real-estate business expect their numbers to grow.
BC,
2 Hill Place
.99ac (350X221)
3/1 Ranch in somewhat rough condition, as-is, but not completely unsalvagable.
Oil tank already removed from ground (in garage).
Buyer is most likely planning a tear-down or a major remodel.
“Where’s the dead cat? I don’t see it.”
Clot [36],
Not yet. After the charlatans announce their stimulation package or a new agengy [housing bonds] is created in an attempt to save the housing market.
JB,
Thanks. Almost an acre in Peapack for 340K? WOW.
“but point still is CPI reading is low, compliments of Alan Greenspan 1983 manipulation,”
confused[34],
Compliments of Arthur Burns. The torch was then passed to AG.
New to the board. Love the commentary. Have a question about ‘phatom bids’ how prevelant are they ? I had an agent tell me that a house was under contract 10 days ago and it still appears on realtor.com. Is this normal ?
See we just need the laid off subprime folks to relocate to Asia.
JPMorgan Chase plans to add at least 700 staff to its Asia-Pacific headquarters in Hong Kong over the next three years, and lease up to 11 floors in a new office block to accommodate the growth, Reuters reported.
While the subprime crisis has hit the world’s biggest financial institutions, they are still notching up high growth in Asia, where investment banking fees rose 36 percent last year to a record $11.7 billion, according to Thomson Financial — roughly the gross domestic product of oil-rich Brunei.
Roy Kinnear, JPMorgan’s Asia-Pacific chief operating officer, said he expected double digit annual percentage growth in staff numbers in Hong Kong and Asia, up to 2010 or 2011.
The bank now employs 3,200 people in Hong Kong, from a total of 18,000 in Asia-Pacific.
BC (41)-
It’s in-town. Not the prime stuff; kinda like in-town Far Hills.
re: Alan Greenspan.
I am tired of seeing him on prime time news.
Just last night he was explaining why he was a hawk, and he continues to repeat tired old assumptions that Saddam was still going after the Straits of Hormuz. Iraq has no port or border on the Strait. Saddam had no naval capability of consequence after the first Gulf War. He had no Air Force. On the ground, he would have had to fight his way through a legion of enemies to approach the Strait from either side, and plainly would have been crushed. The U.S. Navy is also invincible in those waters.
At least one can see why the Fed has no statutorily delegated role in military matters.
Greenspan’s latest book-promoting trips through the media is turning him into the Britney Spears of economists cum regulators.
Between these strange lines of denying causing the Housing Bubble Greenspan may be admitting that he assured the Bush II White House that the Fed would bolster the economy and the markets in the event that an invasion of Iraq in March of 2003 caused another oil shock.
If true he would have contributed quite a great deal to the Bush Administrations comfort level in deciding to invade Iraq.
It may be that he extended the duration of his preternaturally low interest rate policy precisely to fulfill such a promise to the Administration. I merely speculate, under this interpretation, his claim to having worried about the Straits of Hormuz would be either a smokescreen or a particularly spurious recollection.
I am not the only one who thinks he has betrayed the trust placed in the Fed chairman. Do he have any idea how he is perceived by others?
From the NYT Dealbook blog:
Has Measuring Risk Changed ‘Forever’?
For years, three big agencies assigned risk ratings to thousands of securities, helping investors figure out which were likely to be safe investments and which were more speculative.
But one of those agencies, Moody’s Investors Service, essentially said on Monday: Goodbye to all that.
Financial innovations in recent years — and a concurrent lack of information — has cut the ability to track risk “probably forever,” the agency said on Monday.
“It is extremely unlikely that in today’s markets we will ever know on a timely basis where every risk lies,” analysts at the ratings agency, led by chief international economist Pierre Cailleteau, wrote in a report.
Greenspan is one of the Anti-Christ’s acolytes.
Why would you want to live in Peapack? So you can go hang at the Peapack Puddle??
Anyways good morning all my bubblers.
I watch a Hillarious show this weekend called Please buy me. Talk about desperate.
Its funny to watch and see what stupid reasons people give for not being able to lower there prices anymore.
My favorite is I can’t lower the price anymore I need it for retirement.
So its everyone else’s fault you did not plan for retirement and now you are relying on someone else to help you retire.
What if prices did not increase like they did?
Welcome to 2008 year of the double digit declines. 50% off 2005 prices is comming to a town near you! BE ready
Homer…
‘they need it for retirement’ is wishful thinking. I happen to want to date super models but am still waiting.
53 Homer, I agree on those shows, especially the retirement part. I always think, wouldn’t it be better to lower a bit now, get out now and at least you’d be out.
There are no 50% off 2005 prices coming ever. JMO.
BC (45)-
Near intersection of Mendham Rd/Mosle Rd. May also be surrounded by similar POS.
PZ (47)-
The listing could be under contract, but the listing agent hasn’t bothered to change the status in the MLS. Marking it “pending” is the only way to get it off Realtor.com.
Clot,
http://njrereport.com/images/hillmap.gif
http://njrereport.com/images/hillsat.gif
The property backs to Patriot, it might not be on the best street, but for $340k it’s not a bad deal.
Block 4, Lot 16, the property directly “above” this one (76 Mendham Rd) was purchased by a builder in December of 2004 for $393,000. Home built on that lot is currently assessed at $700k.
Ann (55)-
I wouldn’t bat an eyelash if we end up at a point 50% off the ‘05 highs.
My call has been 30-35% off, but there are plenty of signs that this thing is gonna be much worse than anyone can imagine.
“There are no 50% off 2005 prices coming ever. JMO.”
Ann,
Don’t bet against it.
46 BC bob
Compliments of Arthur Burns. The torch was then passed to AG.
It may be that Arthur Burns also mated with a Jackal to produce A.G.
50% off 2005 highs…. and then we wake up. ;)
grim (58)-
Nice lot, but the builder’s “Rule of Three” tells me you’d need to create a $1,120,000 package there.
Tough proposition right now for an in-town, dead-end street in Gladstone.
50% off 2005? If that happened on my street, we’d be back to 1999-2000 nominal prices.
Ann in the last two months in my neighborhood I saw two foreclosures, both in good condition. One sold at 670K at peak, bank last it listed at 475K no takers, the other was 650K at peak bank sold it for 385K. Not 50% but close. Even better both blocks had two or three similar owner homes for sale when the foreclosures hit, good luck with that.
My first RE purchase was a coop that was listed at 107K in 1989, (yes they sold models at that price), I paid in Nov 1991 27K, around a 75% drop in 2 1/2 years.
Why not 50% drop, traditionally, houses in NJ good areas sell at 4X income. Avg income is 70K so we should be at 280K avg home prices. We will have a dead cat bounce in the spring, them winter 2008/2009 will be fun.
Don’t be suprised in 2009 to see a RTC like entity created to dump properties. Also don’t hold your breath on loans over 417K being confirming loans anytime soon.
Clot,
Oh, I agree, especially on spec. But for someone looking to roll their own on a budget?
I added more detail about the property directly to the North. Was purchased 3 years back for close to $400k.
Heck, 50×100 buildable lots in sketchy areas of Clifton were going for $300k+ two years back.
#22 about the price of “Princeton Collection” homes.
I suspect that this phenomon will be observed in pockets around the state: for one reason or another a particular development, neighborhood, block, or house bucks the downward trend. This is not unlike “microclimates,” when it comes to weather. The gardeners amongst us are probably familiar with microclimates; one may be in a given temperature zone but, because of a lake, a forrested hill, a line of trees, etc, the climate of a given piece of property is warmer or cooler than what would be expected or than what is found a short distance away.
Nevertheless, just as a microclimate does not define an entire region’s climate, one neighborhood, development, or town’s home prices do not define what is happening in an entire region. In the hour after the Titanic hit the iceberg, the area of the ship near the stern was high and dry. Even after the bow was submerged, the stern area stayed dry. Were I standing on the Titanic’s stern deck , I would not argue that, just because my portion of the ship’s “real estate” market was still above water, everything was good for me.
Places like the Princeton Collection may or may not get caught in the downdraft. I would not pretend to have the ability to predict. Nevertheless, looking att he data (especially that concerning household debt) I am not persuaded that (regardless of how much desire there is amongst the population to buy or trade up — the so-called pent-up demand) that enough people have the means to do so.
Very Weird, a foreclosure on a reverse mortgage.
Bankruptcy Sale - United States Bankruptcy Court Western District of Wisconsin
In Re: Nancy A. Starr
Case # 05-15339
Future Interest “In & To” Real Property
Available for Immediate Sale - Currently Accepting Offers
Description:
Single Family Home Located at 913 Jefferson Avenue, Sparta, Wisconsin 54656
Currently Occupied by 85 Year Old Widower as Life Tenant
Monroe County
Lot Size: .18 Acres (7,841 Sq Ft)
APN: 281-02220-0000
Alternate APN: 281-690-000-004
Fair Market Value as Per County Assessor: $67,300.00
Annual Real Estate Taxes: $1,610.70
Future Interest Definition (www.Wikipedia.org): In property law and real estate, a future interest is a legal right to property ownership that does not include the right to present possession or enjoyment of the property. Future interests are created on the formation of a defeasible estate; that is, an estate with a condition or event triggering transfer of possessory ownership. An example: Suppose O is the owner of Blackacre. Consider what happens when O transfers the property “to A for life, then to B.” Person A acquires possession of Blackacre. Person B does not receive any right to possess Blackacre immediately; however, once person A dies, possession will fall to person B (or his estate, if he died before person A). Person B has a future interest in the property. In this example, the event triggering the transfer is person A’s death.
Mel Hoffman, Chapter 7 Trustee
David R. Maltz, Auctioneer DCA# 762794
Richard B. Maltz, Licensed Real Estate Broker
Phone (516) 349-7022 Fax (516) 349-0105
ann 55 I already have 1 at 35%(one I’m looking to buy)& afew at 18%(not pos)so I see no reason that in the outer burbs that 50% is a never.If I can get the one I want my lowball would put me at over 60% off org. list.I however will wait
just alittle longer before offer.REO let the bank stew awhile.They had one deal crash already mortgage issue.I will make an all cash offer.In my area 50% will surly happen.A town house sold for 180 in Indian Fields REO.One of my buyers were selling same unit for 295 at peak.This info will not show up for awhile but I
know about the deal.It is still early in the game just give it time.
#62 gary: 50% off 2005 highs…. and then we wake up.
It may not happen, but then never say never.
Shore (67)-
The price on that “Princeton Collection” has everything to do with the demand.
Where else in suburban Princeton can you get a deatched SF home in the mid-400s?
On the other hand, the ultra-low price makes you question the location and construction quality.
Why do you think 50% will not happen Ann?
My reasoning for thinking that prices will drop is simple. Most people cannot afford these prices without teaser 1% apr or I/O mortages. Why do you think they were created?
Again most people go by the idea of 2.5 times there income. Yes there are people who make fancy salaries, but most of NJ does not. Look at government stats. 70% of the entire state of New Jersey has a household income of under $100,000.00 /year
And the average is 65k so only about 30% of the states entire population can afford these prices and the other 70% of the state can either by tiney shacks or are up the creek without a paddle.
I can’t figure out why people on here think that a salary under 100k is nothing? 70% of the entire states of NJ is a lot of people.
So since most of the states makes under 100,000.00 per household income, I would love to know who these people are who are going to come pay these absurd prices with the increasing property taxes?
John (68)-
It’s a bankruptcy, not a foreclosure. There is also not a reverse mortgage involved. There appears to be a life tenancy involved, with an 85 y/o widower as occupant. I’m guessing the court wants to keep this elderly person in the home, rather than tossing him out on the street, so they are looking for a new owner for the property who is willing to take it subject to the life tenancy.
#71 “Clotpoll Says:
The price on that “Princeton Collection” has everything to do with the demand…On the other hand, the ultra-low price makes you question the location and construction quality.”
Clot,
Here you hit on something that is so very important, no matter what the product — price vs. value. So often, I see people jumping to purchase a product because it is 10% less expensive than another, even though it is likely to last just, say, half as long as something of greater quality. Value is the key.
My reasoning is (overly) simple.
Going back to 50% off 2005 would put us BELOW 2001 prices, which was roughly when the prices were back to 1987 prices after the slump. That’s really, really low, and that’s when the bubble started to explode. This is JMO and I’m no economist. You could all be right in which case you should get your shekels ready for that, because that will be a bargain indeed.
On Princeton Collection, I like your theory of microclimates Shore Guy. That’s exactly what Princeton Collection is. It’s the cheapest single family home development in Plainboro, which is still a very desirable town for the Asian community. In fact, one could argue that much of the bubble in parts of Middlesex, including Plainsboro, was fueled by the high demand from Asians. It’s the cheapest way to live in Plainsboro without living in a townhouse. Princeton Collection is also old now, in need of those kitchen and bathroom renovations, so the prices are sort of low, which is a good way to get in.
IMHO, I have a hard time imagining the scenario that results in 50% price declines.
Sorry, I’m terribly pessimistic, but even I can’t imagine a downturn of that magnitude.
IMHO, 30% real is about as bearish a forecast as I can muster. No sugar coating, no lean towards the upside.
At 30% real down, properties begin to find themselves being cashflow positive. This creates a floor under which prices will not fall. In order to forcast greater declines, you’ll need to include assumptions about a significant drop in not only incomes, but rents as well.
50% off 2005 highs, especially if we’re talking about nominal prices, is an incredible longshot.
71 Princeton Collection
The houses are quite small. Some don’t have basements. Many need new kitchens and bathrooms. Some are 3 br. I think it’s just the chance to live in any single family as opposed to a townhouse that makes them appealing.
77
Oh sorry, also meant to write that most construction from the 80s in Plainsboro is total crap, like really, really bad, but the town is very desirable for Asians.
Ann (78)-
Let’s put a really fine point on it: Asians are willing to live in POS in order to have their kids go to West Windsor HS (considered by many to be top HS in NJ).
I’m not pointing a finger in derision, either. I think it’s admirable. Quite a sacrifice.
From MarketWatch/CNBC:
Citigroup may cut workforce by 5% to 10%: report
Citigroup Inc. is mulling letting go between 5% and 10% of its staff of about 327,000, business news channel CNBC reported Monday. The bank, which has been hit by subprime-related losses, may also sell some assets, according to CNBC, which cited people familiar with the matter. Citigroup is scheduled to report earnings next week. The stock lost 0.5% in early dealings Monday.
The next problem?
http://www.minyanville.com/articles/C-jpm-bac-WB-wfc/index/a/15423
http://www.cnbc.com/id/22505383
“I heard from the NAR’s chief economist earlier this week that a quarter of all real estate agents in California didn’t even make a sale in 2007, so I’m guessing a lot of those NAR members aren’t actually working. ”
Any thoughts on the situation in NJ? I have a friend whose S.O. is in RE and it seems like she almost never has a sale. Is it a situation where 10% of the agents make 90% of the sales?
Grim,
I’ll take 30% ….it sounds very fair considerring todays market ..!!!
Anyone cares to gues what stars numbers iwll be???
Shore (82)-
That’s about right.
Grim, can you let me know the address on NJMLS #2749438 when you get a sec? I’m curious where it’s located in town.
I’ve gotta go to work…I’ll check in this evening..
but I think the “wild card” here is the interest rates. What can John Q afford per month. Back in the day there were folks
happy to have a 12% mortgage.
Cindy
Grim, ann etc.
regarding a 50% drop….
I think 50% would be on the far end of the range, but not out of the realm of possibility, If we enter a period of stagflation like in the late 70’s or even if the US dollar continues to be ravaged by inflation, then the real vs nominal prices may put the % drop close to 50%
Doyle,
60 Donaldson
Thanks Grim, looked for it this weekend (without the address) and couldn’t track it down). I was one block over!
Hey I have a question, is there a way to find out how much a bank paid for a forclosure?
Reason I ask is theres on right down the street from where I live and I found how much is listed for, but I also know they paid a lot less for when the purchased the house according to tax records.
The address is 94 Denow Road lawrenceville NJ 08648. Just curious it seems like an awful big markup from what the owner original paid in 1997
This was taken from Calculated risk ( hope its ok to do that grim…) We have talked about how this may start to happen, well it looks like has started
Jingle Liens
Hat tip to Disempowered Paper Pusher (the backbone of our industry!) for this excellent BusinessWeek piece on homes abandoned by both borrower and lender, “Dirty Deeds.”
An anecdote with all the right motifs:
In 1998, Elizabeth M. Manuel obtained a $34,500 mortgage on the property from IMC Mortgage (since acquired by Citibank). By 2002, the loan had been sold into a securitization trust administered by Chase Manhattan (now JPMorgan Chase) as trustee. It also went into default, and Chase began foreclosure proceedings. In a court filing, Manuel (who could not be located for comment) said she left the home while the foreclosure action was pending. More than five years later, though, the title remains in her name. The house, although still standing, has become a fire-gutted wreck.
In May 2007, Nowak issued a default judgment against Chase for $9,000. But these cases can be notoriously difficult to untangle. Thomas A. Kelly, a spokesman for the bank, notes that Chase sold its trustee business to the Bank of New York Mellon (BK) in October, 2006, and couldn’t locate anyone at Chase able to comment. But he reiterates the industry view that Chase can’t be held responsible for maintaining a property it never owned. He acknowledges that if a home didn’t seem worth taking as collateral, the bank may have made a decision to “just walk away.”
Besides amusing myself by trying to figure out just what documents I’d have to give Judge Boyko to prove standing to foreclose in this case, I am of course deeply impressed by the social acceptability of “just walking away.”
My guess is that Chase never completed the foreclosure precisely because it never wanted to held accountable for taxes, insurance, and maintenance on a nearly worthless property; the “tangle” of securitization and trustee swaps and so on undoubtedly contributes to the mess but at some level that’s smoke. So the city of Buffalo is working out a new process to tie those properties around the lenders’ necks precisely to forestall this game. It will certainly be interesting to see whether it catches on elsewhere.
Reading things like this also always makes me think of the endless complaining you get over FHA appraisal and property inspection practices. Every time you’re tempted to think those are silly and bureaucratic–delaying closing for another 30 days while an attic window pane is repaired–and in need of “modernization,” remember these properties that were decrepit at the time they were first mortgaged by those modernized conventional subprime lenders, nearly worthless at the point the borrower could no longer carry the payments, and then nothing more than urban blight after years of the lender refusing to take title. FHA, for all its flaws, never walks away from title.
NEW BRUNSWICK — The Planning Board on Tuesday night will review site plans and a variance application for the Gateway project, which could culminate in final board approval for the $130 million mixed-use redevelopment project.
As designed, the project is to include a condominium tower, an eight-story parking garage, the Rutgers bookstore, the university press, retail shops and public space within a transit village component.
It is to extend from the southeastern corner of Easton Avenue and Somerset Street, south to Wall Street and east to near St. Peter the Apostle R.C. Church. The roughly 200-unit condominium tower is to rise 290 feet closest to Easton Avenue.
Financing for the project could be in place by August, with ground breaking in the fall…
http://www.thnt.com/apps/pbcs.dll/article?AID=/20080107/NEWS010211/801070420/1001
Anybody else read the Star Ledger’s personal finance column in the Sunday paper. This is where they profile an individual or family on how best to manage one’s asset portfolio based on current lifestyle and income for retirement. I enjoyed yesterday’s where they profiled a same sex couple ages 25 and 27 with combined income of $225K. The article, as always, provided a great insight for the typical NJ family. Start by paying off your $3,000 credit card balances and than apply your modest salary to your 401’s, IRAS, mutual and brokerage accounts. This way you, the typical NJ family, will be on track to have a comfortable retirement with a survivable amount of $5 Million.
I think the RE bubble started in 1999. I was househunting in 1997 to 1999. Around Russian Bond Crisis time October to December 1998 there were some short lived value prices. By the time I had my DP saved up in spring of 1999 we were already at the bidding war phase. In late fall 1999 I remember going to an open house on a run down colonial where it was a blind auction. You put down a price and then on Sunday night at 8pm you were instructed to stay at you phone while you were called. I got called and was told they changed the rules as the high price was not high enough. They gave us the chance to top it. Which I did, then they called back all eight other bidder who top me then I topped them then I was not out topped and they changed the rules again and called it off. They did this crap again the next month and got 15K more and sold it. I bought my house Christsmas week 1999, five minutes into an open house and signed the binder and gave them a check on the spot. I bought a run down 60 by 100 split by then and it was mania. We have not had a rational RE market since early 1999. Now buyers have time to ponder and go back and forth between many houses and haggle and haggle this will cause a slow downward pressure on prices for a long time. Going back to 1999 to 2000 price can happen. My house is down 100K in the last 24 months. What is there to stop it from doing another 100K in the next 24 months?
Re: I enjoyed yesterday’s where they profiled a same sex couple ages 25 and 27 with combined income of $225K.
Do their investments have a substanial penalty for early withdrawl?
Is that the couple near me that has a sign on their front door that says Enter in Rear?
#93 Thirty years from now, assuming a 7% rate of return on the assets and also withdrawing 4% of the assets per year (yes I know the withdrawl of principal will reduce the amount of the return, but I am ignoring that for now) this $5mm will result in an income of about $70,000 in 2008 dollars.
Anyone who is on track to have less than $5mm in non-home assets (unless one is willing to sell one’s home and rent, not that there is anything wrong with that), should not delude themselves into believing that they will have a “comfortable retirement.” They may survive just fine, but it will not be stress free or particularly comfortable.
#65 John you bring up some valid points!!!hhmmnnn
When talking about prices in real dollars for real estate, what inflation index is most relevent? Wage inflation or raw materials inflation, or something else?
What happens if existing home prices are held down by low wage inflation, but new home prices have to be priced much higher due to raw materials inflation?
From Reuters:
IndyMac says GSE costs may hinder loan originations
IndyMac Bancorp Inc’s mortgage loan originations slumped 53 percent in November from a year earlier and may be hurt more as Fannie Mae and Freddie Mac tighten requirements on loans they purchase, the company said on a Web site.
IndyMac last year shifted its business to loans eligible for purchase by the two government-sponsored enterprises from the riskier, “Alt-A” type, characterized by loans to borrowers that fall short of income documentation or down payments. The move was made as investors in Alt-A and subprime loans pulled their support as defaults soared.
The GSEs, which posted larger-than-expected losses in the third quarter, have raised fees on loans they guarantee and added a surcharge on loans for higher-risk borrowers.
now that CFC is at $8 per share does it become a value buy. Do you wait until it hit $5? CFC has over 50K employees and for this firm to implode would be a a major blow to financial sector.
Is anyone interesting at picking up mozillo’s bank and mortgage unit at 15 CENTS ON THE DOLLAR.
From the AP:
Paulson: No Easy Answer to Mortgage Woes
The Bush administration is working on a number of fronts to combat the country’s severe housing crisis but there is no simple solution to the problem, Treasury Secretary Henry Paulson said Monday.
Ann wrote “Princeton Collection is also old now, in need of those kitchen and bathroom renovations…”
What, do the kitchens and bathrooms not work? ;)
I can totally understand the [i]desire[/i] to have a thoroughly modern and beautiful kitchen/bath, especially when the home’s price is $300k and above. But let’s not buy into this HGTV mantra that anyone [i]needs[/i] granite coutnertops, sub zero appliances, and those oh so trendy bowl-like bathroom sinks.
Kurt
Don’t buy CFC, too risk, if you can’t resist wait till YE numbers come out and causes the next shock to CFC. At that point buy the bond at 25%, convt that can become common or the Pref Stock which has a high yield. Stay away from Common, they will cut the dividend again, it can fall further and in a bankruptcy bonds and pref gets paid first so common will get zero. Remember, no matter how cheap a stock gets you can still lose 100% of your money.
Vulture investors often buy the bonds etc. of near bankrupt companies if they think the current price is at least liquidation price in hopes they can worst case pick up a few largre interest payments. With the common in a company near bankrupcty you might as well bet on black at AC.
Also WAMU is very depressed too, but at least they have a good retail side and started a good cost cutting initative pre subprime crash.
Remember, smarter companies like Chase or Goldman will be more than happy to pick up pieces of CFC at firesale prices but no way do they want the whole thing. Too much risk. Plus they could buy a SOV or a WAMU dirt cheap with less of a massive amount of problems. No one wants CFC in its entirity.
make money Says:
January 7th, 2008 at 11:19 am
now that CFC is at $8 per share does it become a value buy. Do you wait until it hit $5? CFC has over 50K employees and for this firm to implode would be a a major blow to financial sector.
Is anyone interesting at picking up mozillo’s bank and mortgage unit at 15 CENTS ON THE DOLLAR.
Those trendy vessel sinks may look nice in a first-floor powder room, but they are entirely impractical in a bathroom that gets anything but looked at.
A must see from the Housing Panic blog.
http://housingpanic.blogspot.com/2008/01/youtube-video-freak-realtor-who-might.html
#104
Yeah, I hate those sinks. Form over function.
#105
She is a scream, an agent from central casting. But, to be fair, her job is not to get people to make good decisions; her job is to make sales, regardless of whether the purchase is in the interest of the buyer. For this reason, it is absurd that the NAR and its economic analysis unit is quoted as if it is a nuetral observer of the RE market.
I am confused… you need to elaborate it for this strong claim. you can disagree with his economic policy but it is another issue to label a good person like this.
>Confused In NJ Says:
January 7th, 2008 at 8:56 am
Greenspan is one of the Anti-Christ’s acolytes.
# 108
bi,
Perhaps he meant it in the positive sense :-)
Another form-over-function device is the electric glass-top stove with touch sensor buttons. I am renting a place with one now and will be glad when I leave it behind.
Dallas Newspaper Selects the Illegal Immigrant as Texan of the Year
http://www.foxnews.com/story/0,2933,320427,00.html
God help us all.
only in america.
Weakness in Manhattan rental market:
http://www.therealdeal.net/issues/December_2007/1196818383.php
From MarketWatch:
U.S. economy in recession, Merrill’s Rosenberg says
The U.S. economy is in a recession, David Rosenberg, chief North American economist for Merrill Lynch, wrote Monday. “Friday’s employment report strongly suggests that an official recession has arrived,” Rosenberg said in a note to clients. Other Wall Street economists have said much the same thing. “The key question now is how deep the recession will be and how long it will last,” wrote Richard Berner and David Greenlaw, economists for Morgan Stanley, in a note to clients on Monday. Over the weekend, Harvard economist Martin Feldstein said he believed there was a greater than 50% of a recession in the United States this year. Feldstein is on the committee of academic economists who typically determine when recessions begin and end.
Does anyone know about this lowball in Millburn (242822). I’ve been watching the market there for about five months and this is encouraging to me. We low-balled a house there recently but the buyer refused to negotiate. It’s standing empty now. I’d lowball something else there, but there’s only about 10 houses listed now. When will it pick up again? Also anyone have an opinion re. renting an apartment v. a house? The house rents seem really high and don’t include heat or hot water. And do you have to pay realtor a fee in NJ? Sorry for all the questions … any help appreciated.
#96 Shore..
Good Analysis. So your saying converting $5 Million back into current dollars (3%cpi) or $2 Million, net of realestate assets, gurantees a childless couple just a marginal retirement? So in the real world where 50% of the workforce has access to a 401K and 50% of those who do, actually contribute, and where the average family income of $65K, what % of New Jerseyites would you estimate will amass this $5 Million in assets.
Re 116 - The problem with the 65K crowd is they can’t catch up. If you are very lucky money at 10% (all equities) can double every seven years.
The 65K crowd have no chance of building up a large amount in their 401K by 40. Reason is the doubling of money.
5K put in when you are 21 becomes 10K at 28, 20K at 35, 40K at 42, 80K by 49, 160K by 56 etc. If you wait till 40 to start saving that doubling effect does not kick in big time till 28 years out. You don’t have that luxery of time cause you may need the money starting at 64.
Goldman’s Student Loan Education Could Be Painful (Reuters)
“Goldman Sachs’ $1 billion lifeline to First Marblehead Corp to protect its newly acquired 20 percent stake might not be enough to revive the struggling student loan company,” Reuters reports. “Boston-based First Marblehead’s bread-and-butter business - packaging student loans into securities - has dried up, thanks to prolonged turmoil in global debt markets. And analysts and experts say investors also should be worried about the company’s rising loan defaults, its corporate governance and reliance on two banks for 44 percent of its 2007 revenue. Investors want to see if Goldman’s intervention will revive a high-flying finance company whose shares plunged in 2007.”
Is Goldman overpriced are they that good or that smart?they have to have some negative exposure to the upcoming credit turmoil that involves Student loans, Creditcards and automobile loans and their packagings into securities. Any thoughts?
#115 leavingqueens
I had to pay cost of first month rent as ‘fee’ to a broker in Summit for my rental. So consider you’ll need first and last months rent plus broker fee. Heat & hotwater is included in my place. About 2k per month for a 2BR 2Bath. Broker will refund fee if you buy a home with him, for what it’s worth.
102 Kurt,
Just explaining my reasons why I think this particular development might be a microclimate all its own.
People really like SFHs obviously, and since these are on the cheaper end of the things in this town, for the reasons I mentioned, including dated kitchens and bathrooms, I could understand how they would still be selling right now.
One more think in amassing large amounts in the 401K, unlike me my brother did the max in the 401K starting at 21. He got married at 27 to a 24 year old girl and he made her also do the max. When they bought their first coop they would sit at home Sat night as they could not afford even to get take out yet they never stop the max. They did not even own a car their first nine years of marriage. When his wife left the work force at 32 she was an AVP and he was and AVP and already they had amassed a huge fortune. Since they did only equities the whole way my bother crossed a million dollars in his 401K by 44 years of age. The key was 1988 to 2003 was cheap times in stocks he nailed it. Putting 12K in your 401K in 2008 is like putting in 3K in 1996. If joe blue collar work put 5k in his 401K during that time period and into all equities he would be set for life now.
Clotpoll Says:
January 7th, 2008 at 10:05 am
Ann (78)- Let’s put a really fine point on it: Asians are willing to live in POS in order to have their kids go to West Windsor HS (considered by many to be top HS in NJ). I’m not pointing a finger in derision, either. I think it’s admirable. Quite a sacrifice.
clot: except it is in vain…..what these people fail to understand is that in the endgame, they are doing their children a big disservice….you want to present something unique to colleges, not appear indistinguishable from other similar competitive candidates….
The nuances of societal norms are sometimes lost or ignored on those who are unfamiliar…a great example is the use of the interpersonal skill “tact”.
OT: this headline caught my eye….
Naomi Campbell interviews Hugo Chavez
Cindy Says:
January 7th, 2008 at 6:51 am
Grim, (#37) I have a small - $200.00 a mo. from check-403B TSA (since 2004) with Pacific Life that runs through UBS Financial Services in NJ. Is that a problem? I hate 403Bs because they limit what sort of vechicle/who you can work with but it is the only way I can deal with that $1,000. I get from Oregon. Cindy
Cindy: I don’t have enough information, but #1 you are likely completely insulated from any issues with PL or UBS, and #2, if you are actively employed you should use your current basket of employee benefits.
If you are no longer employed by the place that has offers the 403(b), that probably opens the door to certain choices that I will not elaborate on here due to the presence of the thought-police…..
Could someone pull an address for GSMLS 242746? thank you :)
ket,
Are you missing a digit?
grim Says:
January 7th, 2008 at 1:29 pm
ket, Are you missing a digit?
grim: ring finger on right hand….an old sports related accident, but the story is too disgusting to repeat……suffice it to say that you are correct…
sorry grim
gsmls 2427460
Goldman bonuses for the peons
http://www.nypost.com/seven/01062008/business/goldman_sack_cloth_bonuses_790643.htm?dlbk
what these people fail to understand is that in the endgame, they are doing their children a big disservice….you want to present something unique to colleges, not appear indistinguishable from other similar competitive candidates….
So if their children go to West Windsor High, they’ll appear “indistinguishable from other similar competitive candidates”? I’m not following.
re: 121 (John)
401k are great and all unless you work(ed) for Countywide where some smuck allocated in 33% of the plan’s total assets in Countrywide Stock.
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2007/09/12/financial/f120712D45.DTL&type=business
Or go back to 2001 where if I remember correctly nearly 40% of Lucent employees 401k money was in Lucent stock. :(
And who can forget Enron, those poor people took a real bath there!
So Joe Blue Collar, age 30 , in today’s terms, needs to put $15K a year. Assume a 3% employer match and $85K a year. Joe would need to put up $12,450 a month or 15% of his salary. Assuming this is possible after living expenses, family etc. he would only amass about $1Million in today’s dollars for retirement. Still a far cry from the required $2 Million to have a mediocre retirement.
(assumed contribution=inflation growth, 7% roi)
No, Sean…anybody who has to pay insurance premiums in the future on the liability is taking the bath.
In most cases, employees will get back 65% of their losses. The ambulance chasers get the rest.
http://www.erisafraud.com/Default.aspx?tabid=1025
Kettle,
75 LEFFLER HILL RD
Raritan Twp.
OLP $349900
LP $299000
#130
snyc, what is being said (I think) is that there is a group think to move closer to these “top” schools. What is not as well publicized or well known is that it is usually much, much better to be the big fish in that small pond then fight it out with everyone else wanting to go to Harvard and Princeton. These Ivys have soft limits on how many they can take from each HS. My salutatorian in HS wanted ever so bad to go to Harvard. At almost any other school she would have made it in. However our valedictorian also wanted to go and thus she was shut out by him. They only accepted 1 kid a year. The competition in the northeast HS for these high profile Ivys is incredible. If you want to go to one of these schools, West Windsor high is the LAST place you want to go IMO.
These Ivys have soft limits on how many they can take from each HS … If you want to go to one of these schools, West Windsor high is the LAST place you want to go IMO.
I had no idea. Thanks for the information.
HEHEHE,
That sucks for the peons if true. They must want to reduce headcount there through attrition.
Quick! Someone tell the rich, young, intelligent, and fabulously sexy graduates to stay away next year. No jobs for you…
NYC economy to add only 500 jobs this yr-monitor
New York City’s economy will add only 500 jobs this year as the subprime mortgage sector snarls growth in key sectors, including Wall Street and the construction industry, a report estimated on Monday.
This would be a sharp contrast to the approximately 41,000 jobs created in 2007. That figure was down from the 62,200 jobs the city of more than 8 million people added in 2006, according to the Independent Budget Office’s report.
New York City’s economy soared during Wall Street’s latest boom. But last year the weak housing market and credit meltdown likely cut bank and brokerage profits by 75 percent, to just $5 billion, the report said.
“While there appears little reason to think our assumptions are too pessimistic, there is a reasonable chance that they are overly optimistic,” the IBO added.
62000 –> 41000 –> 500 ????
Damn!
Fun little story for the group.
Its was recently mentioned that a house on birch st in mendham was recently foreclosed on. According to the neighbors they are still in the house but are doing nothing to maintain the house ( none of the normal maintenance stuff) apparently they feel they were tricked into their mortgage and plan on leaving the house in less the desirable condition.
Yes this is essentially gossip, but i still thought it was interesting in relation to how foreclosures might impact surrounding areas.
#137 They must want to reduce headcount there through attrition.
True, to a point, but they also know that for many of these people they have few choices as far as other places of employment.
I remember when I was at Goldman in the early 90’s, I was on the municipal sales and trding side, so not a cost center, we made money, lots of money.
Our bonus money that year was cut by over 60% from the prior year, which was an incredibly propserous year for the firm.
My point in all this, is the “street” can and has turned on what seems like a dime.
Some who have been in the business only a few years, seem to haev great difficulty in undestanding that.
#138 grim: not to beat a dead horse, but soembody better tell pret.
sybarite,
Thanks for the address
# 116 “So in the real world where 50% of the workforce has access to a 401K and 50% of those who do, actually contribute, and where the average family income of $65K, what % of New Jerseyites would you estimate will amass this $5 Million in assets.”
Not many, and not likely any who are earning $65k a year. My view is different from some others here, I do not think that $50k/yr in NJ is middle class for a family income. I am not even sure that $65k is.
They may be upper lower class but it is not a strong middle class family income.
Oh my heart is all a flutter
Our verbose president is about to stutter
KL
I like seeing all the low-ball sales, but how can the everyday person like me find more information about a particular sale?
Here’s one that’s listed that i’d like to know more about?
MLS # 241534 Livingston
OLP 750k
LP 500k
SP 500k
I wanna know if this was a ranch/split/cape location? REO? taxes? etc. etc..
sorry it peaks my interest when I see a 750k place sell for 500k in a town i’d like to live.
Hobokenite,
If I was one of them I’d be pissed but what can they do. It’s not like they are going to jump ship to another I-bank when none of them will be hiring any time soon. Kind of have to smile and be happy they have a job. I know I am glad I do and hope things stay that way.
3b Says:
January 7th, 2008 at 2:10 pm
#137 They must want to reduce headcount there through attrition.
True, to a point, but they also know that for many of these people they have few choices as far as other places of employment.
Doesn’t sound like GS thinks the local economy will be doing well in the coming year.
#148 Doesn’t sound like GS thinks the local economy will be doing well in the coming year.
And they would be right.
I am a kiwi- lived in the US for several years now. If you think RE in the US is out of whack- take a look at this from today’s paper in NZ.
Highlight:
“Barfoot’s figures, out yesterday, showed an average sale price of $480,738 in 2006 climbed to $538,478 last year.”
Whats the average salary in Auckland- $50,000 NZ (about $30,000 US). Talk about lack of affordability. And mortgage rates? The standard variable rate went to 8.77% this week.
Ouch.
I am in the coulda shoulda mentality. Waterfront property has just gone nuts, all overseas buyers. And as for exchange rate, it went from $1 US getting $2 NZ dollars to now only getting $1.42 thanks to the tanking US dollar.
If only I had taken all my equity when I sold 2 moves ago,moved the equity to $NZ when the exchange rate was so 2:1, and collected on the 8% plus interest rates you can get even in money market accounts, then even I could afford to buy a 1 bedroom apartment in Hoboken.
Nuts.
Article:
Auckland house owners got much richer last year, despite a levelling-off in the super-heated property market.
Figures from the city’s largest agency, Barfoot & Thompson, and the Real Estate Institute showed Aucklanders got spectacular returns on housing, ignoring warnings from Reserve Bank Governor Alan Bollard against tipping money into property.
Average or median price increases beat most bank interest rates.
Barfoot’s figures showed a 12 per cent average gain last year. Real Estate Institute figures backed this up, showing big gains for most Auckland areas.
But property sceptics say the gains should not tempt buyers back into the market, which they believe may weaken further next year.
Barfoot’s figures, out yesterday, showed an average sale price of $480,738 in 2006 climbed to $538,478 last year.
The 2005 average sale price was $458,784.
Peter Thompson, the firm’s director, said that although fewer properties were selling, prices were holding up well.
It’s interesting to note that property prices do not seem to have been affected by reduction in sales volumes,” he said.
Last month’s 495 sales were down more than a third on December 2006.
But the average sale price for December was still 2.4 per cent up on November, Mr Thompson said.
He predicted the number of house sales in Auckland would stay low this year, but prices would still be firm and might even improve.
Wow - I can believe someone feels bad for Enron workers “And who can forget Enron, those poor people took a real bath there!”
re: Goldman - only 15% bonus? screwing with the back office and IT people in a banner year?
I believe many of those back office and IT people are in the Jersey City tower on 30 Hudson, so this means more bad news for NJ real estate especially in Hudson County.
All that bonus money must be going into that shiny new 2 billion dollar tower on 200 Murray Street their new world headquarters.
Opinion requested:
The wife and I have been saving our butts off. We’ve been dumping money into an online savings account for the last 18 mos with the hope of making a home purchase (but thanks to this blog we’re still saving!!). On the other hand we’ve totally neglected to do the same in our 401Ks. Should I revise this logic being that we’re probably not purchasing until early next year? I really hate passing on the company match however I feel like I need liquidity if something “pops up”. Any input is appreciated.
disclaimer - Of course I understand that your opinions are just that, and I’ll ultimately make my own decision.
Wow - I can believe someone doesn’t feel bad for Enron workers.
The Labor Department also acknowledged that many Enron employees lost 70 percent to 90 percent of their retirement assets after the company indicated that it would re- state profit reports. “The Labor Department’s Pension and Welfare Benefits Administration is reviewing Enron’s benefits plans, the rules that govern them, and steps that were taken by the company shortly before its collapse to temporarily freeze trading of 401 (k) plan assets,” it said in its press release.
A bonus is what a company thinks it will take to keep you around for the next year, nothing more, nothing less. 2007/2008 is a perfect example of this IMO.
152 …..the rest of WS biggies will be ompacted accros the board…..and no-one know what true writedonwns are…am sure they will be bigger this and next quater ,,,and I am not gloating about it!!!
here is one:Jefferies Says It Had $24 Million Fourth-Quarter Loss (Update2)
By Yalman Onaran
Hank…
Hank!
C’mon, Hank. If you really think so, why didn’t you say anything before?
45,000 homeowners seek foreclosure aid: Paulson
“A housing correction was inevitable and necessary,” Paulson said.
Highly recomended video
http://www.youtube.com/watch?v=as3AYVzWmOI
MM
New Jersey 2006 middle class income is $66,752, richest state in the land and you folks act like you are broke!
Enron employees were the crooks. Lets see work at Andersen cook the books get a few big bonuses become an Enron employees make a few extra hundred thou and then lose most of 401K. Mabye if they gave back some of the loot they got in the 90’s I would feel bad for them.
401K is an above the line deduction and with a match is normally a guaranteed 50% roi on day one. You are nuts to not contribute at least the match.
“C’mon, Hank. If you really think so, why didn’t you say anything before?”
JB,
Because he only knows the Goldman way.
re: 155 (Mike) “keep you” and keep you happy are two different things. Goldman uses a world class methodology for employee retention and promotion, the rules there are pretty straight forward, work hard and you get paid well. The fact that they changed the game and drastically cut bonuses for one area while raising bonuses on average 15% for other areas and nearly doubling Lloyd’s bonus will surely lead to big personnel problems, especially after all of the outsourcing to India of back office work over the last few years.
They must be predicting a financial calamity to gamble like this especially with people who make probably a tenth of what the broad street employees are paid.
#162 BC Bob: As some one who worked at GS for many years (pre- IPO), it is funny to see all teh GS hoopla over the last few years.
In my days there, most people (not on the stree) nver heard of it, It was not your Merrill, Smith Barney etc.
It is in my opinion when a firm Wall St or otherwise in popular imagination becomes akin to a cult, thats just not good.
We are witnessing the passing of two eras: Political change and economic change are going hand in hand. It is no coincidence.
http://www.thestreet.com/pf/newsanalysis/investing/10397271.html
That line should have quotes
Thanks for your input John. I agree 100%, but we needed access (preferably penalty free) to those funds in the event we purchased a house. We’re 1st time buyers and need all the help we can get. I’m not overly familiar with 401Ks and our HR/benefit admins suck so it’s nearly impossible to get info…is there a way to borrow against your 401K if needed without paying a penalty? I would think that if you can borrow, is there interest? Who receives the benefit from this int?
#153 SS,
You should contribute to the extent of the match you get in your 401k. I can’t think of any money market fund that offers you a 50% return.
If required, you could dip into your 401k to get a loan for the down payment. Look into your 401k plan details.
Also, a Roth IRA is an alternate place to dip into for $10K each of your down payment amount penalty-free.
So you do have a few options. Hope it helps.
Earlier today, somebody was skeptical in reference to AG.
“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed rate mortgage…the traditional fixed-rate mortgage may be an expensive method of financing a home.”
Alan Greenspan, February 23, 2004.
If required, you could dip into your 401k to get a loan for the down payment. Look into your 401k plan details.
I generally advise against borrowing against a 401k for downpayment funds for all but the most savvy folks.
401k loans typically require payback shortly after termination or separation.
If you didn’t have the funds for the downpayment, it’s unlikely you’ll have the funds to pay back the loan immediately. Options? Take the penalty or refinance. However, there aren’t going to be many refi options for someone without a job in today’s market.
SS -
re: 401k
i have to agree with the others who posted - i believe contributing at least the match is what you should be doing.
#170, Grim
Agreed. That’s why I said ‘if required’ at the beginning.
The biggest drawback to taking a 401k loan is that the loan becomes payable at possibly the worst time….when a job is terminated.
Dream: thanks, that does help. My concern about the Roth is its income ceiling. Currently we’re flirting with that and expect to creep over in another year or two. If I go ahead and set up a Roth now, then begin to make a salary above the limit, what happens to my ability to contribute?
#169, BCBob
Was it a case of the herd being led to the wolves one last time?
I’m amazed at the number of people in their 30s and 40s with educations who are just now starting their 401k plans. Assuming normal returns, I could retire in 30 years on what I’ve already saved. Granted I won’t be touring the world on a luxury liner, but at least I could afford Hamburger Helper instead of cat food.
jmac #175- my wife is a teacher at a private school, they don’t even have a 401k plan until you have 5 years of service (no pension either). She and most of her colleagues are in their 30s or 40s. I expect there are many workplaces like that.
401k’s
I returned to work after the New Year to learn that my company actually bumped up the 401K match to the max 6% dollar for dollar and adjusted the full vestment schedule to immediate (from a 4 yr full vestment plan). I was quite suprised as it is rare to ever witness a benefit increase (at least in my lifetime). Not to mention, our out of pocket expense for the health plan didn’t increase.
JBJB #177,
I heard from a colleague that MetLife recently changed their 401k 100% vesting from 5 years to 3.
175:
To add to post 176 - I couldn’t afford to participate. I had outstanding debt (college loans, living expenses, etc) that I needed to pay off. And I’m not talking luxury debt either! I drove a 1980 Rustang for a long, long time!! I needed every dollar from my paycheck. Only now am I getting my financial house in order and looking to plan ahead.
However prior to private industry I worked for a state authority where I was enrolled in a NYS pension plan. Most recently, I’ve had 3.5 years now of 401K exposure but have decided to dump into savings accounts instead…this is changing now!
#175
Speaking of cat food; where has BOOYAH been?
Hey Grim,
Here’s what your NAR dues go toward:
http://www.realtor.org/pac.nsf/pages/pachome
Get ready…here’s the 2008 propaganda campaign, ready for rollout over the next few weeks.
SS #179,
There are many who can not afford to deduct for 401k, even when the option is available to them. Here, in New Jersey, where everyone who is anyone makes $250,000.00.
401K loans are usually only up to 50K and that can only be 50% of your balance. You start paying them back immediately and the soon the better cause when you quit or get fired the whole amount is due back plus ten per cent. I did noe when I closed on my place in Feb 2000 and actually made money cause while that 50K was out the stock market fell like a brick. But if you did the same thing in March 2003 you lost a lot of appreciation the next three years.
If you are doing it to avoid a home equity loan and PMI and just need the extra 50K it is not a bad thing, cause even if you lose your job you can just take home equity to pay back balance. But like grim says be careful.
Not contributing to a 401K is crazy talk. If got a 5K match (free money) in 2003 that is now worth 10k even if you pulled it out and paid tax you would be way ahead, you most likely are only in 20% tax if you are poor and it is only a 10% penalty. You could pull the 10K and pay 3K in taxes and have 7K in pocket. If you can afford new clothes, buying lunch at work or a car you can afford the 401K. My mother skipped christmas gifts and home improvements and our newspaper subscriptions some years but never the 6% in the 401K that got the match.
My company is dollar for dollar up to 6% and there are some people who said they can’t afford to contribute who will then tell you they are saving in a money market at 4%, that is taxable and is more like 2.75%. It is crazy, they should make it mandatory.
#173 SS
Considering that you’re close to the Roth ceiling, I’d say contribute..for the simple reason that you’re able to contribute something before you’re phased out between $156K-$166K AGI, and you’re basically set up for tax-deferred and tax-free withdrawals later on. Whether you wish to use the money for the down payment is up to you.
The stuff to watch out for is that you don’t withdraw earnings within the Roth as part of your down payment, since your money will be in it for less than 5 years.
You can contribute $9000 right away - $4000 for 2007 (have to contribute by mid-April 2008), and $5000 for 2008 for each of you. That’s $18,000 in total.
ChiFi (122)-
Often, the “top HS” gambit is in vain…unless the kid hits 800s on his SAT and is in the top 5% of his class.
Funny how every single one of the parents thinks their kid is the one who can pull this off.
ChiFi (123)-
“Naomi Campbell interviews Hugo Chavez.”
Hugo probably lured her into the interview with an 8-ball.
ChiFi (127)-
He’s either Jerry Garcia…or Ronnie Lott.
185#, john, if it is mandatory, you have to complain about tax hike
>It is crazy, they should make it mandatory.
There won’t be a tax hike as we will save on these peoples welfare and nursing homes in retirement.
Thanks Dream. I was just reading that on the IRS’ website. I’m actually meeting with a company sponsored CFP on Thursday and will iron out all the details. At least now I have some ammo to take with me. I appreciate all your input.
SS Says:
January 7th, 2008 at 3:09 pm
Opinion requested: The wife and I have been saving our butts off. We’ve been dumping money into an online savings account for the last 18 mos with the hope of making a home purchase (but thanks to this blog we’re still saving!!). On the other hand we’ve totally neglected to do the same in our 401Ks. Should I revise this logic being that we’re probably not purchasing until early next year? I really hate passing on the company match however I feel like I need liquidity if something “pops up”. Any input is appreciated.
disclaimer - Of course I understand that your opinions are just that, and I’ll ultimately make my own decision.
SS: I’ll add a few comments, but obviously we have an expert here who is willing to post copious amounts of expertise on everything possibly knowable about personal finance, so my utility here is severely limited.
#1 Roths….many employers offer a Roth 401(k) option….if not, you can take advantage of your 2007 Roth limit of $4000 by April 15th of this year. You can add another $5000 for 2008 and $5500 for 2009. As of now, for 2010 and subsequent yearsa, there is no AGI limitation, so you don’t need to be concerned.
#2 Company match….it is very important to take advantage of this feature with a few caveats:
- will you be (partially or fully) vested at the time you separate from service?
- how much is the match?
If you want to use “the all knowing Oracle’s” strategy of washing down payment money through a 401(k) or Roth, make sure that you investment the money appropriately for your time horizon. Just because you have money in an investment account, don’t be tempted to “put it to work”. Instead, keep it in conservatives investments that are consistent with the time and place you will need it.
Ultimately, I must defer to the real experts in this area. All I do is bilk people for marginal value at best.
Clotpoll Says:
January 7th, 2008 at 5:00 pm
ChiFi (122)- Often, the “top HS” gambit is in vain…unless the kid hits 800s on his SAT and is in the top 5% of his class. Funny how every single one of the parents thinks their kid is the one who can pull this off.
clot: precisely…without going into details, I have met with about 30 students over the last couple of years from good school districts applying to Cornell as a method for the school to personalize the application process. Only 4 were admitted. One circumvented the apllication process because he was directly recruited by the AD, one was a legacy, and two made the cut, of which one matriculated. I’m am not talking about chump change here. These kids are the best of Monmouth County.
Clotpoll Says:
January 7th, 2008 at 5:02 pm
ChiFi (123)-
“Naomi Campbell interviews Hugo Chavez.”
Hugo probably lured her into the interview with an 8-ball.
He better not piss her off or she may throw that diamond encased cell phone she beaned her old personal assistant with at him. That would be a true victory for consumerism.
SS….if you are meeting with a CFP….do not use any approaches that could possibly restrict your ability to access money when you need it. If it is not clear….press the issue until you have a complete understanding.
Also, under no circumstances should you purchase a life insurance product unless it is term insurance….
A nice snippet from the Seeking Alpha at http://tinyurl.com/224bd3
Website of the Day
Many a commentator/analyst/economist has predicted that the housing market will only bottom when sellers finally get real and slash prices to where the market is at. Only then buyers will step up, inventory will move and the housing slump will be over. For a glimpse of how that scenario is playing out in New Jersey, go to the New Jersey Report. This week they feature an informative graph on recent “lowball” transactions– when buyers made significantly low offers on homes that eventually sold– versus owners original asking prices.
I think I’ll keep my online savings intact for the most part, however on a go forward I plan to restructure these contributions to and IRA of some kind.
Speaking of online savings - does anyone use eTrade? How have your experiences been? I know they’ve just had a cash infusion to keep breathing, but what do you think about their long term existence? Of course I will not top FDIC limit, so I’m safe there, but the hassle? My current account is now down to 4.5%, and it takes forever to move money around. I was looking into eTrade for savings, checking, and trading but wasn’t sure about their current state.
I wasn’t eligible for my first couple of years of employment because my jobs were temp jobs, plus my first permanent position had a one year waiting period before 401k enrollment. I put money into traditional IRAs instead. There are other ways to save if your employer doesn’t offer a 401k plan.
To those who said they couldn’t afford it: you can’t afford to not make a contribution. $200 a month won’t take much off take home pay once the tax benefits are considered. Not all of us will be able to do the max but putting away something is infinitely better than putting away nothing, especially early in your working life.
#194
top HS’s -
i was always inclined to believe what was posted here today regarding top high schools and college admissions, until my daughter came home and told me that word around school is that 14 kids got accepted to cornell early admissions, from millburn hs. 14!! that’s a ton! i don’t believe the senior class is that large either.
i’ve tried to send my kids to the best possible hs i could afford, not because of some scheme to get them into a name college, but because, i really believe that it’s better to surround your kids with high achievers and high standards. i don’t disagree that many kids do great in less than top schools - and go on in life to be very successful, but ultimately, you have to make a choice, and i’d rather err on the side of safety, and get them into a great school - even if it means i have to live in a smaller house.
JBJB Says:
January 7th, 2008 at 4:33 pm
401k’s I returned to work after the New Year to learn that my company actually bumped up the 401K match to the max 6% dollar for dollar and adjusted the full vestment schedule to immediate (from a 4 yr full vestment plan).
JBJB: It is likely a benefit enhancement for highly paid workers, and they need to provide a bigger carrot to others. As I noted before, many younger workers may avoid participating in their company’s savings plan because they don’t plan to stay long enough to vest. If your firm is forward thinking, they may have concluded that Gen Y is going to walk out the door in 2-3 years max no matter what they do, so they may as well allow the top guns to max out their 401(k) and scale back other benefits to Gen Y in subtler ways.
169. BC Bob Says:
January 7th, 2008 at 4:05 pm
Earlier today, somebody was skeptical in reference to AG.
“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed rate mortgage…the traditional fixed-rate mortgage may be an expensive method of financing a home.”
Alan Greenspan, February 23, 2004.
BC Bob; Many people celebrate Alan Greenspan’s Tenure as the “Great Fireman” putting out the fires of Crisis. Few drill into his role as the “Great Arsonist” causing all the Crisis to begin with. His first Great Crisis was the S&L Fiasco, caused by him, and settled by him with Tax Payer dollars. He was also the architect of things like Taxing Social Security Dollars, which had already been taxed. He was the Great CPI manipulator in charge of creating False Inflation Reports to minemize COLA impacts on Entitlement Programs. If A.G. had been the FED Chair in the 1800’s, he would have been tried for Treason & Shot, for betraying the Public Trust. AG has lied for so long, he no longer recognizes the Truth. In Fact they should rename the FED Board Chair as Federal Office of the Liar. It’s purpose is dissemination of False Information for Political & Economic Gain.
t c m Says:
January 7th, 2008 at 6:02 pm
#194 top HS’s -
tcm: I’m just relating the facts.
A couple of things….the bulk of the kids I interact with are impressive and will move forward to be interesting people with fulfilling lives. As a result, my opinion of the whole process is merely that it creates much angst, and very little of it truly helpful or justified. However, it is easy for me to say such a thing in my position.
Regardless, it is good to fail, because at that age, it is probably the most important thing to really digest, have resonate, and then motivate you forward to build a life that fits your identity.
A lot of people just don’t get it though.
[separate post responds to a different aspect]
t c m Says:
January 7th, 2008 at 6:02 pm
#194 top HS’s - i was always inclined to believe what was posted here today regarding top high schools and college admissions, until my daughter came home and told me that word around school is that 14 kids got accepted to cornell early admissions, from millburn hs. 14!! that’s a ton! i don’t believe the senior class is that large either.
tcm: bear in mind that if you know anything about Cornell, such statistics doesn’t really add a lot of information…..you need a breakdown of where they applied within the school….you would see that it is much more slotted and restricted than it might sound on the face.
chicago -
i don’t know a lot about the admissions process at cornell - so it could be that 14 is not impressive - i was just surprised that a top college would want so many kids from just one high school - i was always told that they don’t want more than one or two. also, remember that with early admissions, the kids pretty much pledge they will go to that school, so cornell isn’t even banking that the kids will turn them down.
Jimmy Cayne BS to step down WSJ.
“His first Great Crisis was the S&L Fiasco, caused by him, and settled by him with Tax Payer dollars”
confused [202,
LOL. Many don’t realize that he was hired by Charles Keating, Lincoln Savings and numerous other banks. AG argued that these institutions did not present risk to depositors nor the govt.. The rest is history.
He may go down in history as the greatest con man in finance.
I disagree with the conventional wisdom on this board, as stated by Clot and ChiFi, regarding the importance of going to a top high school (ie, that it’s not important). You need top numbers to get into a good college and you are more likely to get good grades/SAT if you are at a top high school.
Obviously individual circumstances, parental involvement, etc play a big role. But it’s a lot easier to motivate yourself to work hard and study in high school when half your class and all your friends are applying early to top colleges.
Hey Grim,
Here’s what your NAR dues go toward:
http://www.realtor.org/pac.nsf/pages/pachome
Get ready…here’s the 2008 propaganda campaign, ready for rollout over the next few weeks.
Do they just take the previous years campaign and replace the year??
Any estimate on how much the tolls are going up to on the GSP and Turnpike? $5 or more?
Re [201]ChiFi
I agree that it is something along these lines. I work in the biotech field, and there is currently a lot of moaning going on about the lack of available talent. In addition, many younger/mobile folks are working two-three years and jumping for a better deal, but my company has been able to minimize turnover of quality people, I think they are indeed trying to stay ahead of the game. In addition, all employee 401K contributions are obviously elective, but the employer automatically makes a contribution to your account for 1% of your salary each year, whether you participate in the 401K plan or not. This is supposed to get the participation numbers up, although I haven’t seen any data on whether it has worked.
#208 -
in addition, it’s not just about getting into a top college - it’s about learning - and high standards. granted, parental involvement and home life is the MOST important, but it is much easier for a parent (no matter how good or bad they are) when your child’s peers are all reaching high and serious about school. i guess there is a point that the pressure can be too much, but that’s when parental involvement becomes important again.
i have 3 kids - they are all very different. my youngest son tends to rise to the occasion. if the bar is high, he’ll go for it - but if the bar is low, he’ll be happy just reaching that. it’s easier for him to be motivated when all his friends are motivated to do well. i believe that for him, and many kids, it’s a benefit to be around a group that has high standards.
if your child is still a toddler, or pretty young, you may not see it yet - but teens are influenced by more than just their parents.
“Britons ‘richer than Americans’”
“The average UK person will this year have a greater income than their US counterpart for the first time since the 19th Century, figures suggest”
http://news.bbc.co.uk/2/hi/business/7174372.stm
From the WSJ:
Bear CEO Expected to Step Down
But Remain in Chairman Post
By KATE KELLY
January 7, 2008 7:14 p.m.
James Cayne, the chairman and chief executive of Bear Stearns Cos., under fire from shareholders after the Wall Street firm was badly burned by the downturn in the mortgage market, is stepping down as CEO, say people familiar with the matter.
Mr. Cayne, who was named CEO in 1993, acquired a reputation last year for being a hands-off leader as the current credit crisis unfolded. Yesterday, he started notifying the board that he plans to relinquish his CEO post but remain as chairman, say these people. Mr. Cayne is expected to be succeeded by Bear President Alan Schwartz, a 57-year-old investment banker respected for his deal-making savvy.
Mr. Cayne, who turns 74 years old on Feb. 14, didn’t return a phone call seeking comment.
The discussions of Mr. Cayne’s fate come as Bear Stearns shares hover near a four-year low, reflecting investor concerns that the company hasn’t seen the worst of the fallout from the credit crunch. With the nation’s mortgage market floundering, it isn’t clear how the firm, a big maker and trader of mortgages and mortgage-related investments, will compensate for huge revenue losses in those businesses, casting doubt on its earnings prospects.
Why is the NAR talking about the value of housing as a long-term investment? Nobody’s denying it, so why are they talking about? Hey, Lawrence Yun, why not tell your minions to tell the fat drunken b*stards to lower the f*cking asking prices? Perhaps that would be a good place to start instead of worrying about fleecing the plebs for the 6% fee.
Pizza
http://www.bloomberg.com/apps/news?pid=20601093&sid=aoGrY0BIFB.4&refer=home
gary Says:
January 7th, 2008 at 7:39 pm
Hey, Lawrence Yun, why not tell your minions to tell the fat drunken b*stards to lower the f*cking asking prices?
gary: dude…I needed you yesterday…you left me high and dry….
#215
NAR is a joke. They simply are babbling at this point. They do not want to talk about the topic of the day which is accelerating price declines and accelerating sales declines. It much easier to talk about something that might happen 10 years from now.
Not bad..
http://njrereport.com/images/2471673.jpg
MLS# 2471673 - 19 Franklin Drive, Basking Ridge, NJ
Just came on the market today.. Asking $450,000, was purchased in 2000 for $357k. Comes out to 3.5% appreciation per year. Prior to that it was sold in 1998 for $339k, nearer to the 3% line from ‘98.
Assessed at $628,800.
4br/2ba on almost an acre.
Still digging up the details but the owner is listed as a trustee.
Only downside is the location stinks, you border 287, but have a barrier. Not a bad looking house in a nice town with a very good school system.
chifi,
Work is madness, we’re busier than ever. It’s hard to post what I really want… I don’t have the time. Whata ya need, somebody’s legs busted? lol!!
Herring123 Says:
January 7th, 2008 at 7:08 pm
You need top numbers to get into a good college and you are more likely to get good grades/SAT if you are at a top high school.
fish: I didn’t say the school doesn’t matter, but bear in mind the focus…..
If you want to raise a successful learner, you do what you believe best….case closed…I have no conflicts with any of your opinions.
HOWEVER, if the endgame is to get your kid INTO an ivy league school, then you are best off being a maverick out in the hinterlands than “one of many” from the correct zip code.
Think about it…if you have three students who are essentially identical on paper, who do you go with? Kid #1 from Millburn; Kid #2 from West Windsor, or Kid #3 from a private school in Trenton who is ever so slightly weaker…….guess who wins?
Right Pat?
BTW, I love the YOY sales/inventory charts, they’re beautiful.
YOU HEAR THAT SELLERS?!! YOU’RE F*CKED! FORGET THE VACATION TO SOME OVERRATED ISLAND!! HEY MARGIE, FORGET EATING OUT FOUR NIGHTS A WEEK ANYMORE, LOVE! BESIDES YOU NEED TO LOSE A FEW!!
Yup.
Specially if she has no couth. As opposed to tact.
Right, Clot?
Interesting comparison;
MLS 2455987 $799,000 Chatham (Morris County)
MLS 2446619 $529,900 LongHill (Morris County)
Both properties are “Stirling Properties” free standing Townhouses. Very similar, but price differential for Chatham is in the clouds.
More tomorrow, gotta run.
t c m, I agree with you. Having your child be around high achieving students is a good thing to motivate them to strive for the top. Even though the competition might be intense to get into the Ivys at these high schools, you just have to keep reminding them that not attending an Ivy league school doesn’t signal the end of the world. A high college GPA is what keeps all doors open to you, not necessarily the name of your college. If you can compete with the best of them in high school, you learn study skills that will help you stay on top in college & grad school.
All of my NJ peers attended Ivy league schools (some even went to WWP). Although I had been accepted to Ivys, my family couldn’t afford to foot the bill since this was before Harvard declared 180K to be middle class. But aside from not being able to partake in their boring Ivy stories at dinner parties, my success in my education at little known colleges and state schools has kept me on par with all of them professionally. I attribute it to motivating myself in a competitive high school environment (APs galore) and therefore being able to stay competitive throughout the rest of my education. I was easily the big fish in a small college pond. Compare this to the top students who came from the less competitive public high schools in the area and were struggling at the college level because it wasn’t attendance = A anymore. Add to it all the average and dumb kids who were there just to fill the college coffers and it was way easy to get ahead and get all the good opportunities in a small college if you were smart and motivated coming in.
Sorry about the long comment above. I just realized if parents are moving their kids to WWP to be in the “good school district” then they are probably the same parents who think that Ivy schools are the only way to go for college.
JB [219],
Not bad at all. Do you know how close to 287?
BC,
http://njrereport.com/images/franklinsat.jpg
(Not a survey)
That is close. I’d be afraid retread from trucks would land in my yard (half joking).
On the flip side, nice size lot with nice undeveloped woods behind it.
JM
That is probably one of those massive stone walls that is about 50 feet high….what I would hate about that would be the FUMES from the automobiles….you know they are spewing exhaust and you are breathing that big time in that location.
JB[229],
Thanks.
gryffindor Says:
January 7th, 2008 at 8:06 pm
Sorry about the long comment above. I just realized if parents are moving their kids to WWP to be in the “good school district” then they are probably the same parents who think that Ivy schools are the only way to go for college.
g: yessir….
From the WSJ on top colleges and the high schools which feed them:
http://online.wsj.com/public/article/SB119638146482608732-9E67f3pXH1oZVdeiEGwshfa9_rM_20071229.html
“In a sign of the shifting global economic food chain, students from abroad now take up a growing number of spots. At the University of Pennsylvania, 13% of the class of 2011 is made up of international students, up from 11.8% the previous year.
And coming from a prestigious suburban public school or elite private school may not offer the same advantages it once did for students. Many Ivy League schools say they’re going after low-income students more aggressively, making it harder for middle-class kids to stand out.”
One of my best friends from the old neighborhood was subject to his parent’s ire after ONLY being admitted to Chicago undergrad…..he removed himself from their permanent black list by graduating with a BA cum laude in Economics (yes THAT department) and getting a JD from Harvard Law.
Chicagofinance #124
Thanks for the info re: UBS. and..I DO use my current check to put funds aside. Remember, I’m one of those $68thou folks so I do what I can. No matched funds.
I will be in a position to have two smallish pensions -OR and CA. Problem is I also paid into SS for 32 years when I was in banking and in Or. as a teacher. No SS taken out for teachers here so once I moved back to CA I fell under the “windfall elimination provision.”
You don’t even want to know how that works…
Anyway - I am only being given credit for 20 yrs. or 40% of my benefit.
(One year I was off of the “substantial earning” minimum by $170 - they threw out the year’s credit!) Once you hit 20 years - each additional year counts for 5% up to 30 years ) So watch out! I might make a “windfall” if they give me credit for all of the years I paid in but did not meet the sub. earn. min. Hey, I was going to college and raising babies - BUT I worked in every year - from the time I was 16..Oh well.
Anyway..Thanks
Cindy
Don’t get me started on that one..
Playoff Time for Fed Officials
The Federal Reserve seems to be in a bind. Cut interest rates too much, and it could exacerbate brewing inflation problems. Cut them too little, and it could miss a chance to forestall recession.
Two speeches from Fed officials today could shed light on these competing dilemmas. Boston Fed President Eric Rosengren is scheduled to speak in Hartford, Conn., about the housing downturn. Mr. Rosengren lobbied for a half-point cut in the fed-funds target rate at the Fed’s December meeting, rather than the quarter-point cut policy makers settled on. On the hawk’s side, Philadelphia Fed President Charles Plosser, who has warned of the inflationary perils of steep rate cuts, will speak about risks to the economy.
They tee things up for Fed Chairman Ben Bernanke, who will speak on markets and the economy Thursday.
The market has already signaled its expectation. Yields on 10-year Treasury notes have fallen to 3.839% in anticipation of aggressive rate cuts. Before week’s end, investors should have a better sense of whether the Fed is of the same mind-set.
SS (198)-
E-Trade blows. Phantom fees, crap service, phone people an absolute joke.
what I would hate about that would be the FUMES from the automobiles….you know they are spewing exhaust and you are breathing that big time in that location.
We do live in Dirty Jersey, automobile exhaust should be the least of our worries.
#221 -
“Think about it…if you have three students who are essentially identical on paper, who do you go with? Kid #1 from Millburn; Kid #2 from West Windsor, or Kid #3 from a private school in Trenton who is ever so slightly weaker…….guess who wins?”
yeah, but, what if none of them gets into the top college? then, who lost? wouldn’t it have been better to go to the best hs that you are able instead of some mediocre hs? face it, the top colleges are not going to load up on kid#3’s from the school in trenton any more than they’re going to load up on the others. at least the kids from the good schools are better prepared for college. (my argument for sending kids to the best school you can is only vs. middle of the road schools, not private schools that are ever so slightly weaker - which probably end up being more expensive anyway)
#226 - your hs/college experience sums up what i was trying to say -
but, what is wwp?
lisoosh, I wonder if the growing numbers of foreign students are paying full price to attend these colleges. So now the new strategy should be to your kid overperform at a little known foreign high school to maximize chances of getting into the almighty Ivy.
I’m also surprised to learn that parents from other school districts can pay $15K to send their kids to Pricenton’s public high school, given the large number of private schools in that area. Do they really have that much extra room in the classes at the public school to accept paying students?
WWP = West Windsor-Plainsboro
#240
West-Windsor Plainsboro
tcm (212)-
“…in addition, it’s not just about getting into a top college - it’s about learning…”
Nah. Getting into an Ivy/top college is the shit. All about being able for the kid and parents to toss around the name at parties, gatherings, etc. I like to call it intellibling.
Half the kids in college don’t have the IQ to handle basic crystalline (synethesis of information into original thought) processes. That’s why many schools have turned into giant training centers. That’s why State U-educated Johnny lives in the ‘rents finished basement, wakes up at noon and pops a coupla bong hits before his shift at Starbucks.
If you install old-fashioned shades in all rear windows, it might cut down on the gritdust (my own term for the special layer that forms daily in houses close to a highway).
If you ever go an open house, try to get a peek at the black shoes on the closet floor - the ones that look like they’re worn all the time. If you walk through on a Sunday, and the shoes have the greyish gritdust coating, it’s from the highway.
grim (214)-
“Bear CEO Expected to Step Down
But Remain in Chairman Post”
They should embalm him, like Lenin.
Come to think of it, he’s the poster boy for bong hits.
gary (215)-
You mean, lower the f(*&ing asking prices on their cabbage-smelling crapboxes?
Pat (223)-
Fight the power.
-Chucky D
BC (228)-
Those sound walls along 287 are like giant amplifiers. That street may sound like a NASCAR race.
That’s why you see many states taking down those walls.
241#, gryffindor, i am not aware that princeton high school accepts students from other school district for $15K tuition but i do know:
1) cranbury township sends their high school kids to princeton high school by send/receive relationship established many years ago;
2) the faculty/staff of princeton university can send their kids to princeton high school for a small fee (my guess is it will much smaller than $15K) even they are not living inside princeton township or princeton borough.
239/grim
what does not kill you, makes you stronger?
My daughter and I are going to check out Oxford U. (yep, the one in England) after two of her older friends just got accepted undergrad. Their parents report the tuition isn’t terrible, aid is available…and the school actually seems to be about learning. Plane tickets are the biggest PIA.
Will report on what I find out.
#252
Now THAT’s intelli-bling.
Reg: Lowball! December 2007
Grim,
Can you put the addresses of the homes in Morris County and the DOM from the OLP ?
thanks.
…may be I am asking for too much, so if you cannnot, then that is fine too.
sybarite (253)-
I just want to visit there. Great excuse to eat at Manoir aux Quat’Saisons and sneak off to EPL matches.
#256
No need to make excuses; I’m sure your daughter would gain an invaluable experience there. Definitely would set her apart from the herd.
However, I was just in London to see Led Zeppelin, and can’t imagine how $$$ that would be…
BC-
I think I just felt my heart slide back down my throat into my chest (it entered my throat thanks to last night’s UNC-Clemson war).
My wife came into my study at the end of the 2nd half, shook her head and walked out. I think I was curled into the fetal position on my desk, with my Tar Heel nerf ball in my mouth.
I still can’t believe we won that game. Clemson beat the crap out of us.
#250 bi - The WSJ article lisoosh posted mentioned “Two years ago, the high school began accepting kids from outside the district for $15,817, after parents requested it.”
It doesn’t say who those parents are however - are they Pricenton professors asking the public school to take their kids or SAHMs from Hillsborough and Montgomery trekking the kids down to Princeton everyday?
syb (257)-
Hey, the pound is racing to the bottom with our beloved USD.
By the time my kid starts school, it’s gonna be Weimar revisited all over the planet.
Thanks, AG…you prune-faced f@#k.
259#, thanks. it is new to me. but i saw the school made a major expansion last summer.
Interesting thing about the Law and NJ Public Schools, is that the School can check the address of Students to preclude out of town citizens from attending, but are forbidden by Federal Law from raising questions about Students being in the Country Legally. America’s Law’s seem to be completly broken.
Pain Street USA: ‘08 housing outlook
The forecast is for a longer, deeper home-price slump than previously expected, with double-digit declines in many markets.
By Les Christie, CNNMoney.com staff writer
NEW YORK (CNNMoney.com) —
The United States is deep in its worst housing slump since the Great Depression, and according to a new report, it’s not going to get better any time soon.
In a new survey, Moody’s Economy.com says many metro areas will record losses of 20 percent or more during the downturn, with the national median price for single-family homes dropping 13 percent through early 2009. Factoring in discount offers from sellers, the actual price decline would be well over 15 percent.
Eighty of the 381 metro areas covered by the report will record double-digit losses, according to the report. Most of the worst-hit markets are in once high-flying areas, such as California and Florida.
Home spiff-ups for all seasons
The steep losses were bound to arrive sometime. Throughout the housing slump, which began in the summer of 2006, experts kept expecting prices to tumble, but it wasn’t until recently that they dropped substantially, according to Mark Zandi, chief economist for Moody’s Economy.com.
“There has been a sea change in seller psychology since the subprime shock this summer,” he said. “Sellers now realize they have to drop their prices to make a sale and prices are coming down very rapidly in some markets.”
One such place is Punta Gorda, Fla. In Moody’s outlook, prices there will undergo the steepest correction of any U.S. market. From their peak during the first three months of 2006, to their bottom, forecast for the second quarter of 2009, prices will decline 35.3 percent. That’s in nominal dollars; adjusted for inflation, the loss will be even greater.
Other metro areas expected to go through crushing price drops include: Stockton, Calif., where prices are forecast to drop 31.6 percent, Modesto, Calif. (-31.3 percent), Fort Walton Beach, Fla. (-30.4 percent) and Naples, Fla. (-29.6 percent).
The worst hit market outside the Sun Belt is expected to be Ocean City, N.J. where prices will fall 24.9 percent, according to Moody’s. Prices in St. George, Utah (-21.8 percent), Grand Junction, Colo. (-18.9 percent) and Atlantic City, N.J. (-18.6 percent) will also suffer. In the Washington, D.C. metro area, Moody’s forecasts a decline of 18.4 percent.
Home prices are being pulled down by an even more severe decline in home sales, which Moody’s expects to bottom out in early 2008, when unit sales will be down more than 40 percent from their peak.
Home builders continued to add to inventory even as the slump got well under way, contributing to what is now an 11-month back-log of homes for sale, according to the National Association of Realtors.
Many of these homes are sitting completely empty: The Census Bureau reported a total of 2.1 million vacant homes for sale. Vacant homes add pressure on prices because owners of these houses are usually more willing to slash prices to move the properties. They cost out-of-pocket cash each month while providing neither income nor shelter.
Even though home construction has now contracted severely - the Census Bureau reported Tuesday that new housing starts were down to an annualized rate of 1.187 million units in November, the lowest in 16 years - it will take time to work through the excess inventory.
The housing slump will have a substantial impact on the overall economy, according to Moody’s, which says it will depress real gross domestic product by more than a percentage point this year and by 1.5 percentage points in 2008.
Speculative investment in the mid-2000s helped fuel the current slump. Zandi pointed out that 16 percent of mortgage originations during 2005 were for non-owner-occupied housing, twice the number of a few years earlier.
“And that’s a very conservative estimate of investor demand,” he said. “Many home buyers lied on their mortgage applications.” That’s because interest rates are lower for owner/occupied dwellings.
Buying for investment was especially prevalent in many resort areas, such as Ocean City, N.J. Many buyers were betting they could hold onto the property for a short time and sell it for a quick profit, a difficult feat to finesse, considering the high transactional costs. Many speculators came late to the party and got caught in the slump. Now their properties are adding to mountainous inventories.
Another factor was excessive new home construction, especially in once hot markets. As prices skyrocketed, builders rushed to take advantage of the increases, contributing to the now high inventories.
Also adding homes to markets was the increase in foreclosure filings. When lenders take back properties, they put them back on the markets. Foreclosures have just about doubled this year.
For the slump to end, much of the excess inventory will have to be worked through. Zandi doesn’t envision that happening much before 2010, which he forecasts to be a very modest recovery year with low, single-digit growth.
# 153 “All I do is bilk people for marginal value at best.”
It is good work when one can get it.
t c m Says:
January 7th, 2008 at 10:00 pm
#221 - yeah, but, what if none of them gets into the top college? then, who lost? wouldn’t it have been better to go to the best hs that you are able instead of some mediocre hs? face it, the top colleges are not going to load up on kid#3’s from the school in trenton any more than they’re going to load up on the others.
teese: I think you missed my point, did you read my other posts? The gryffer understood what I meant….
Bear in mind, I certainly think it helped me get into Cornell Arts & Science that I was some stupid $hitbag from 11355, whose mom was a secretary, dad didn’t have a college degree and parents were divorced. Not the blueprint that Pingry doles out mind you, but it was effective.
Shore Guy Says:
January 7th, 2008 at 11:27 pm
# 153 “All I do is bilk people for marginal value at best.” It is good work when one can get it.
shore: got to get up at the crack of dawn for my next victim…………BOOOYAAAAAA
But nothing bad ever happens in the great Bergen County!!!
grim Says:
January 5th, 2008 at 5:10 pm
Glen Rock Comp Killer
89 Hillman Ave, Glen Rock NJ
Purchased: 2/17/2006
Purchase Price: $530,000
MLS# 2733312 - REO
Sold: 1/4/2008
Sale Price: $350,000
34% under 2006 price.
Sybarite - You got to Zeppelin? Hubby’s dream, missed out on the lottery. Heard someone payed over $100k for tickets.
Hoping for a tour………..
Clot — the whole Oxbridge area/experience/education is fabulous, and intense, and full of rich Arabs. Worth the time, although the social scene is expensive. Friends who went to Cambridge seemed to all receive amazingly eclectic educations.
Lot are also heading over to Edinburgh/St. Andrews/Glasgow which I can heartily recommend. First two have the cache, but Glasgow is actually a REALLY good school.
Clot - phantom fees for the online savings account or just trading accounts?
lisoosh (268)-
Will check the Glasgow thing. That’d always be good for a Celtic/Rangers death match. Probably the most intense rivalry in European soccer. The England thing may be no good, as Allardyce is doing his best to screw up Newcastle for the next 10 years. Guess I could pop over to London and catch Arsenal, though.
To hell with my kid’s schooling, I want my ‘ooligans and football.
SS (269)-
Trading accounts. Every few months, it seemed like the programs and fees changed. I never could get a handle and ended up taking my account to Schwab.
Clot, would it make you swoon if I told you I used to date a Celtic and Scotland player?
OK, in school before he joined either team - but it still counts!!!:-)
“That’s why State U-educated Johnny lives in the ‘rents finished basement, wakes up at noon and pops a coupla bong hits before his shift at Starbucks”
Not that there’s anything wrong with that.
#44 Clotpoll
“That’s why State U-educated Johnny lives in the ‘rents finished basement, wakes up at noon and pops a coupla bong hits before his shift at Starbucks.”
Well this State U-educate Jane has a hefty bank balance, no loans, and unlike Ivy-educated prats knows how to use a fax machine. BTW - I was paid to attend graduate school, and had both my pick of schools and jobs thereafter. Having worked with engineers from around the globe the MIT graduates were pathetic as a whole.
Yeah, the whole mystique of the Ivy league really diminishes once you have the opportunity to work along side some of these folks….solid thinking comes from many, many schools….remember that.
The apostle of the alternative way is a white-haired, bespectacled former education editor of the New York Times named Loren Pope, whose book Colleges That Change Lives is the best-selling admissions guide, ahead of A Is for Admission: The Insider’s Guide to Getting Into the Ivy League and Other Top Colleges.
He lays out all the ways in which the past 30 years have smiled on smaller schools. With rising prosperity, their endowments have grown. The number of Ph.D.s doubled from 1968 to 1998, meaning a deeper pool of professors to choose from.
And in some ways the small schools gained an advantage over their prestigious rivals: after Sputnik, many colleges became research universities, “and smaller has been better for undergraduate education ever since,” Pope says. “At big research universities, professors spend more time researching than teaching.”
Given the changes in the economy as well as the academy in the past 20 years, advocates for smaller schools argue that they give students a sharper competitive edge. “What most parents are concerned about is providing the best security for their child,” says Gay Pepper, head of college guidance at Greens Farms Academy, a private school in Westport, Conn. “Some see going to a brand-name college as providing that security.
We have to shift that thinking. A college that is right for the student is the best form of investment.”
244 Clotpoll
Why the bashing on State U grads? Sure, many colleges, not just “State U” have turned into Vo-Tech centers, but let’s be real, many jobs don’t involve advanced analytical thought either. And rich kids who go to fancy schools don’t end up in rehab? Ha ha ha ha ha ha ha ha ha ha ha.
Everyone I knew from my state college, ended up being quite successful and happy people, no matter where they ended up.
#274 Essex I worked with many, somer were absoulutely brilliant. Many were complete morons,and some were just plain bizzare.