Mon 14 Apr 2008
“The market value is what the market value is”
Categories: Economics , Housing Bubble , New Jersey Real EstateFrom the Record:
The number of home sales in North Jersey plummeted some 30 percent in 2007, raising the odds of a significant decline in home values beginning this year.
Prices inched down only slightly in 2007. But the corresponding drop in sales volume suggests this could be the year when sellers holding out for top dollar blink in their ongoing standoff with bargain-hungry buyers.
“The laws of supply and demand have not been repealed,” said Paul Merski, chief economist of the Independent Community Bankers of America. “At some point, things have to come into equilibrium. Either the demand for homes has to increase or the price has to drop to stimulate demand to get things back into balance.”
Predictions about what’s ahead vary, although few experts foresee a quick return to the boom of the first half of this decade.
Donald Moliver, a real estate professor at Monmouth University, predicted that home prices in New Jersey may drop as much as 20 percent over the next several years, although he said that number could be lower if mortgage rates — now around 6 percent — decline.
A double-digit decline in home prices would eclipse the real-estate downtown of the late 1980s and early 1990s, when the state’s home prices declined about 8 percent from the top of the market and did not return to peak levels for a decade.
…
Adding to the pressure on prices are tighter mortgage standards, a weak job market and rising foreclosure rates. But homes remain unaffordable for many North Jersey families. Even with the market slowdown, home prices are almost double what they were in 2000, while New Jersey median household incomes rose only about 21 percent from 2000 to 2006, the latest figures available.In 2007, prices dropped 1 percent to 5 percent across most of the region, with the upper-end neighborhoods hurt slightly more than lower-end areas, according to a study by The Record of about 29,000 home sales.
But the more telling statistic from The Record’s study is a steep decline in the number of sales, which are down about 40 percent from the market peak in 2004.
The drop in sales volume cuts across all segments of the market, with low-end neighborhoods in southern Bergen and Passaic counties hit slightly harder. Sales volume was off about 42 percent in neighborhoods where the typical home sells for up to $350,000, compared with a drop of about 37 percent in areas where homes generally sell for more than $600,000.
In North Arlington, for instance, the overall value of home sales fell 50 percent from a peak of $62.9 million in 2005. But the median price barely declined last year, from $410,000 to $405,000.
A tighter mortgage market has shut out many people. Rates are relatively low, but it’s much harder to qualify for loans than it was in 2004 and 2005, when lenders freely offered interest-only and no-down-payment loans.
And many potential buyers are scared of paying too much.
“A lot of them seem to be holding off, with the thought that we may not be at the market bottom yet,” said Sheldon Neal of Re/Max Real Estate in Oradell.
Still, many sellers can’t stomach the idea of lower prices.
“Maybe we’ll say a house should be listed between $500,000 and $520,000. Inevitably, the seller wants to be at $520,000 or $525,000,” Neal said. “We are seeing a little bit of a standoff where sellers are not willing to swallow too much pride and accept that the market has lowered the value of their home out of their control and out of the Realtor’s control.”
Sal Poliandro, an agent with Re/Max Properties in Ridgewood, recalled one seller who cried when he suggested she list her house at $450,000.
“The market value is what the market value is,” Poliandro said. “Nobody cares how much you owe on your mortgage. Nobody cares that you’re getting a divorce and want to start your life over.”
From the AP:
New report finds N.J. fifth most expensive state for renters
New Jersey is the fifth most expensive state for renters, making it difficult for many in commonplace jobs to find decent housing, according to a new report from an affordable housing advocacy group.
The report being released Monday by the Housing & Community Development Network of New Jersey, comes as Gov. Jon S. Corzine looks to cut property tax relief for tenants.
According to the report, a person earning $16.45 per hour — a bit less than the state’s average hourly wage — would have to work 54 hours a week to afford a two-bedroom apartment at fair market rent.
It also found a person earning minimum wage — $7.15 per hour — would have to work 124 hours a week to afford the same apartment.
From MarketWatch:
Deutsche Bank seeking to sell $20 billion in debt
European banks are facing another round of losses from the credit crisis, with Deutsche Bank looking to sell as much as $20 billion of leveraged-buyout debt and Credit Suisse expected to write down as much as $5 billion in the first quarter, according to media reports.
From the NY Times:
Wachovia Is Said to Raise Billions Amid Losses
The Wachovia Corporation, the country’s fourth largest bank, is raising several billion dollars from outside investors because of mounting housing losses and an ill-timed acquisition of a big California mortgage lender, people briefed on the matter said Sunday night.
It is unclear whether the investment will come from the issuing of new shares of stock to the public or from private investors. Wachovia said Sunday night that it would move up the release of its first-quarter earnings to Monday from Friday, without explanation. That has led to speculation that an announcement of an investment deal could come with its earnings report.
From the Record:
Contractors struggling to find enough work to survive
At the height of the housing boom a couple of years ago, Hawthorne electrician Scott Lacz had five employees, most of them working on new construction. They were so busy they often put in hours on Saturdays and Sundays, “doing what we had to do,” Lacz said.
But when construction began to sputter about 18 months ago, Lacz had to lay off two workers and shift his attention to renovations and repairs. There’s no more weekend work.
“New construction is dead,” he said. “There’s nothing really going on.”
Facing a steep downturn in demand for new housing, builders and subcontractors like Lacz are scrambling for home repair and renovation work to stay afloat. And they can’t depend on construction hiring to pick up any time soon. Most analysts say the industry won’t revive until 2009 at the earliest. Recent surveys of builders by the National Association of Home Builders found them in a deeply discouraged mood.
The National Association of Home Builders predicts housing starts nationally to be around 1 million this year, down dramatically from about 2 million a year in both 2004 and 2005. Patrick O’Keefe, an industry consultant and former head of the New Jersey Builders Association, expects housing starts in New Jersey to be around 15,000 this year — the lowest number since 1991, which in turn was a 50-year low.
This translates into declining employment in the building trades. According to New Jersey labor officials, there were 168,800 construction employees in the state in February, down from 171,500 a year earlier.
“It’s a difficult time,” said Bernard Markstein, a senior economist with the National Association of Home Builders. He said builders are cutting costs, laying off workers, discounting their prices and diversifying into other lines of business — such as building strip malls or small office buildings — to survive.
From MarketWatch:
Wachovia to slash dividend, raise capital after loss
Wachovia said it’s cutting its dividend to 37.5 cents a share and going to issue common stock and convertible preferred stock after reporting a loss during the first quarter of $350 million before preferred dividends. Excluding merger-related expenses, it lost 14 cents a share. It earned $2.3 billion, or $1.20 a share, in the year-earlier period. Analysts polled by FactSet expected Wachovia to earn 44 cents a share. Wachovia said cutting its quarterly dividend will save $2 billion of capital annually “to build capital ratios and provide more operational flexibility.” Wachovia said it took market-disruption valuation losses of $2 billion during the quarter. “The precipitous decline in housing market conditions and unprecedented changes in consumer behavior prompted us to update our credit reserve modeling and rely less heavily on historical trends to forecast losses,” said CEO Ken Thompson.
Foreclosures.com posted the Q1 preforeclosure stats, NJ comes in at number 6 nationwide.
http://www.foreclosures.com/stats/
Top 10 States (Preforeclosures)
State Filings Per Household
California 120,684 1.05 %
Florida 118,301 1.87 %
Arizona 37,262 1.98 %
Illinois 26,191 0.68 %
Texas 21,521 0.40 %
New Jersey 20,699 0.69 %
From the NY Times:
Foreclosure Politics
With foreclosures running at about 20,000 per week, at least 100,000 more families are likely to lose their homes before Congress passes a relief bill. And even then, the measure may fail to stanch the problem unless Congress comes up with something that is significantly better than proposals currently in either chamber.
To produce a worthy relief package, lawmakers will first have to scrap most of the provisions in a bill passed last week by the Senate.
That bill would cost $21 billion over 10 years, with $15 billion of the total going to tax cuts that offer no direct help to at-risk families or hard-hit communities. One set of cuts would subsidize renewable energy; another would let businesses take temporarily larger write-offs for losses. A proposed $7,000 tax credit for buyers of foreclosed homes could backfire, encouraging more foreclosures by allowing banks to charge more for repossessed property. A measure to let non-itemizers deduct property taxes is dubious tax policy and bad foreclosure prevention, since it does not target the neediest.
Lawmakers will also have to ditch an unhelpful item in a bill from the House Ways and Means Committee — a tax break for first-time home buyers. It makes no sense to encourage buyers to jump in when further price declines are likely. Scarce resources should be put toward preventing foreclosures.
From the NY Times:
Crisis of Confidence
The Survey Research Center of the University of Michigan has been tracking American economic perceptions since the 1950s. On Friday the center released its latest estimate of the consumer sentiment index — and it was a stunner. Americans are more pessimistic about their situation than they have been for more than a quarter century.
Meanwhile, a recent Pew report found that the percentage of Americans saying that they’re better off than they were five years ago is at its lowest level in 44 years of polling.
What’s striking about this bleak mood is that by the usual measures the economy isn’t doing that badly — at least not yet. In particular, the official unemployment rate of 5.1 percent, though rising, is still fairly low by historical standards. Yet economic attitudes are worse now than they were in 1992, when the average unemployment rate was 7.5 percent.
Why are we feeling so down?
Our bleakness partly reflects the fact that most Americans are doing considerably worse than the usual economic measures let on. The official unemployment rate may be relatively low — but the percentage of prime-working-age Americans without jobs, which isn’t the same thing, is historically high. Gross domestic product is up, but the inflation-adjusted income of the median family is probably lower than it was in 2000.
From the Star Ledger:
N.J. hopes incentives will lure builders
It’s been nearly 20 years since a major new office tower has been built in Newark, but officials hope an all-out marketing push, with incentives that could equal 10 years of free rent, will help reconfigure the city’s skyline.
It won’t be easy to attract major construction projects in the face of a recession, and most of the hoped-for developments won’t break ground for a few years, said Stefan Pryor, deputy mayor for economic development.
But Pryor suggested a struggling economy might actually benefit the city.
“When the economy is good, no one’s thinking about saving on lease rates,” he said. “However, when we’re facing tough economic times, CEOs start thinking about every way to trim the budget. … Newark has an enormous cost advantage over midtown Manhattan.”
Plus, he said, “the incentive package has never been better.”
The newest lure is a state program called the urban transit hub tax credit, worth up to $75 million for building near a rail station, or up to 10 years of rent for leasing space there. The state credits will be available in nine cities, including Newark, and require at least 250 employees.
From the Rutgers Daily Targum:
NJ residents seek cheaper pastures out of state
New Jersey residents are leaving the state by the tens of thousands and taking millions of tax dollars with them, according to a report published by the Edward J. Bloustein School of Planning and Public Policy.
New Jersey experienced an increasing annual outflow of residents in the middle years of the decade in spite of good economic times, co-author Joseph J. Seneca said.
…
“We have had out-migration in the past but it was typically associated with a weak economy and recession,” said Seneca, a University professor. “So what’s different is that a good economy is not sufficient to keep New Jersey from experiencing a net domestic out-migration.”
There has been a sharp decline in population growth in the state, according to the report. The state’s population grew by 79,184 in 2002. But in 2006, the population only grew to 21,410 people.
In 2005 and 2006, more people moved out of New Jersey than migrated into the state, according to the report.
…
It is hard to determine the exact reason why so many people are migrating out of New Jersey, he said. One reasons is the high cost of housing in the state, since New Jersey ranks number one in the country in terms of housing costs. The high cost of living in New Jersey not only directs housing costs but also generally causes higher taxes, he said.
In the past several years, New Jersey has experienced slow job growth, Hughes said. This causes less of an incentive to move to New Jersey.
In 2007, job growth flat-lined and more than 10,000 jobs were lost in the first two months of this year, he said.
Has any one heard of this company. They claim that there program can help you pay off your mortgage in 1/3 the time by depositing your pay check into a helco and using your helco as a checking account. Interesting to say the least.
(link deleted -jb)
Thats heloc
Drew,
Most of those schemes are predicated on early principal repayment. Why pay someone else to manage it? If you are interested in paying off your mortgage early, just do it yourself.
Do you get a tax refund? Send it to the bank. Do you get a bonus? Send it to the bank. Send in a mortgage payment every 4 weeks, instead of every month, you’ll make an extra payment every year. Or, convert your loan to a biweekly if your lender will do it for free.
Here is Jack Guttentag’s take on the scheme you posted above:
http://www.mtgprofessor.com/A%20-%20Early%20Payoff/the_cmg_plan_using_your_mortgage_as_a_checking_account.htm
Before you even bother going down these routes, you’ve got to determine whether it makes sense for you to even pay off your mortgage early.
Whats my house worth on HGTV, some of the people look like they just hit the jackpot.
2485048
In the Remarks Column.
“REM: HOME SALE EVENT PRICE REDUCED FROM $350,000 TO $340,000 FOR ONE WEEK ONLY..4/6-4/12.. ”
LOL.
From the AP via the WSJ:
Growing Number of Americans
Avoid Buying Homes, Poll Shows
Associated Press
April 14, 2008 6:33 a.m.
WASHINGTON — A growing number of Americans say they won’t buy a home anytime soon, the latest sign of increasing pessimism about the nation’s housing crisis, a poll showed Monday.
In a vivid sketch of how the sputtering real estate market is causing distress throughout the country, the Associated Press-AOL Money & Finance poll found that more than a quarter of homeowners worry their home will lose value over the next two years. Fully one in seven mortgage holders fear they won’t be able to make their monthly payments on time over the next six months.
“This is a great time to buy, but not necessarily to sell,” said Robert Jackson, who lives in a two-bedroom house in Ferguson, Missouri, with his wife and four young children. He said he would love to purchase a larger home, but can’t because even if he found a buyer, he would probably lose thousands on his house, which he bought less than two years ago. “We’re just going to have to slap a Band-Aid on it and stay here until the market gets a little bit better,” Mr. Jackson, 30, said in a follow-up interview.
Mr. Jackson is not alone. Some 60% said they definitely won’t buy a home in the next two years, up from 53% who said so in an AP-AOL poll in September 2006. At the same time, just 11% are certain or very likely to buy soon, down from 15% two years ago.
The growing reluctance to dip into the housing market seems to stem partly from worry that housing prices will continue falling — good if you’re buying a house but bad if you have to sell one. The number envisioning falling prices in their area has grown to one in four, while four in 10 think prices will rise, a decrease from two years ago.
Underscoring the public’s unsettled feelings, the number saying local housing prices are about right has fallen to 35%. Half say homes are overpriced while those saying housing is underpriced have doubled to one in 10.
#13 Grim
thanks for the reply i will read your link,
I think there program is like $3500, I certaintly will not just buy it without research, but I have to admit the 18 min. video on there web site explains the program very good. Thanks again for the reply.
din,
How about we talk dirty? Same listing, agent remarks:
Seller will pay a 3% commission to buyer broker if house sells within $5000 of asking price
Drew,
I don’t think you understand, my advice just cost you $3,500. Invoice has already been mailed out. Thanks for your business.
Barney Frank’s ‘Subprime Relief Plan’ May Make a Bad Situation Worse
Must read this plan is a idiotic. Between this & the 7000 foreclosure tax cut the market will be a mess.
http://seekingalpha.com/article/72040-barney-frank-s-subprime-relief-plan-may-make-a-bad-situation-worse
Maybe Frank should question Shiller at the hearings.
As everyone knows, housing prices are still falling. Shiller expects them to keep falling for quite some time since the monthly year-over-year declines are still accelerating. Actions taken by government officials may slow these price declines, but eventually the market will have to find its equilibrium. In fact, it would probably be better for our economy if the government did not intervene and allowed this process to proceed as quickly as possible.
http://seekingalpha.com/article/72028-shiller-at-baas-housing-will-continue-to-fall
[8],
“The official unemployment rate may be relatively low — but the percentage of prime-working-age Americans without jobs, which isn’t the same thing, is historically high”
Correct. Remember you have to qualify to be “offically” unemployed. Those who qualify result in a 5.1% rate. When you add those that don’t qualify, it’s closer to 10%. Only our asinine models would not include someone out of work for over a year as part of the official stats.
Grim -
what do you think of this cmg plan?
Grim -
why wouldn’t ever make sense to payoff your mortgage early?
“NJ residents seek cheaper pastures out of state”
So far I don’t see it, GSP and Turnpike are packed, malls are jammed and everyone seems to have a huge SUV. Where’s the mass exodus?
“Where’s the mass exodus?”
Sheriff’s office?
grim #18: I believe that realty company has run the “HOME SALE EVENT” for the past week for a large number of NJ homes… Is that agent’s remark on other properties as well?
…and doesn’t the buyer’s side typically make 3% on a closed sale anyway?
“18 minute video on their website”.
I’m definitely not interested unless there are some male enhancement drugs included as part of the purchase.
From the WSJ:
Retail Sales Edged Higher in March
By JEFF BATER
April 14, 2008 8:37 a.m.
WASHINGTON — U.S. retail sales took a surprising turn upward during March, a promising sign for the economy given the punishment consumers have absorbed.
Retail sales increased by 0.2%, the Commerce Department said Monday. Sales went down a revised 0.4% in February. Sales that month were originally seen 0.6% lower.
Excluding sales of gasoline stations, which were helped by high energy prices, retail sales didn’t budge in March.
Economists surveyed by Dow Jones Newswires estimated a 0.1% decrease in overall March retail sales. The actual, 0.2% increase could be seen as bright news, considering many analysts argue the U.S. has gone into recession, which is defined as two straight quarters of economic decline. The sales report is a key indicator of U.S. consumer spending. Consumer spending makes up about 70% of gross domestic product, the broad measure of economic activity in the U.S. The Commerce Department next week releases its first estimate of first-quarter GDP, which will confirm whether the economy fell and began what could turn into recession.
GDP rose in the fourth quarter of 2007, but the crawling 0.6% increase was far below the galloping 4.9% pace in the third quarter. The economy is fighting higher food prices, surging energy costs, job losses, and a credit crunch. Financial market turmoil has sent stock prices down and the housing slump lowered the values of homes.
[snip]
Excluding gas and auto sectors, demand at other retailers last month was flat. Sales decreased 1.6% at building material and garden supplies dealers; 0.3% at furniture store sales; 0.4% at electronics and appliance stores; 0.5% at clothing stores; 0.1% at health and personal care stores; and 0.6% at general merchandise stores. Sales increased 0.4% at food and beverage stores; 0.3% at eating and drinking places; 2.1% at mail order and Internet retailers; and 1.4% at sporting goods, hobby and book stores.
http://online.wsj.com/article/SB120817573485612533.html?mod=hps_us_whats_news
IVV,
That particular listing is 2.5% to the buy side. So the buyer’s agent would get a 0.5% bonus for getting their buyer to agree to a price within $5k of asking.
#30
Isn’t that a blatant conflict of interest?
That’s allowed?
Drew,
Frankly, I don’t think any of those plans are worthwhile. You are paying an extraordinary amount of money for a “system” that you’ll be responsible for adhering to. No guarantees, and no discussion of the risks involved (having your LOC revoked by the bank).
If you are in the early years of your mortgage (lets just say $300k/6%/30y), a lump sum payment of $3,600 will just about shave a year off your mortgage.
Given that you’ll be doing all of the legwork anyway, why not just use one of the “free” systems available. Biweekly payments, 4 week schedule, rounding your payment upwards, tax refund roll-in, bonus roll-in, double principal payments, etc.
One very, very important note. If you are on the verge of affordability with your loan, NO SYSTEM WILL LET YOU PAY IT OFF FASTER. All of these systems require you to make monthly payments above and beyond your current payment. The deeper the cut, the larger the prepayments.
No free lunch, no financial wizardry.
I always say this, and it boggles my mind…how the Garden State Plaza in Paramus parking lot is fully packed every day of the week
thatBIGwindow Says:
April 14th, 2008 at 9:04 am
I always say this, and it boggles my mind…how the Garden State Plaza in Paramus parking lot is fully packed every day of the week
biggie: no parking fee; free admission
#33 tbw: I was at Garden State on Saturday (dropping off teenage daughter for movies with frineds), at around 5:00 PM, and I was amazed at how easy it was for me to get in and out.
I myself avoid that place at all costs if I can, but again I was surprised as usually traffic is insane at that mall.
From MarketWatch:
Wachcovia sees large writedowns, losses into 2009
Please note that, if your portfolio includes Auction Rate Securities, you may see an inflated market value for those securities. Your Auction Rate Securities will be re-displayed at par by Tuesday, April 15th. Please do not hesitate to contact your Financial Advisor with questions. We thank you in advance for your patience and apologize for this inconvenience.
Nice Smith Barney new disclamer. Tax day will be a shock!
Drew,
One last point and I’m done with this.
If you can afford to pay off a 30 year loan in 10 years (1/3 the time, as advertised), why aren’t you taking advantage of the lower rate (and interest costs) associated with a shorter term loan (10 year or 15 year)?
http://www.youtube.com/watch?v=lI77cU3jsFs&eurl=http://www.stoptheaclu.com/archives/2008/04/10/shocking-new-obama-audio/
BTW Bear is reporting earnings.
3b,
I was at Paramus Park mall at around 5:00 PM on Saturday and said the same thing. My wife said it was because the weather was beautiful and people were taking advantage of it.
Oh boy, oh boy-o-boy. Throw this one on the rumor mill. We all know about the potential Linen’s and Things bankruptcy, but read on.
Apollo struggles to keep debt from sinking Linens ‘n Things
Not long ago, when times were good, Leon D. Black spent $1.3 billion to buy Clifton-based Linens ‘n Things, the home-furnishings chain, according to the New York Times.
Now, as each day seems to bring more bad news for the economy, Mr. Black and his investment company, Apollo Management, are struggling to keep Linens ‘n Things from unraveling, according to the report.
It is a remarkable comedown for Mr. Black, a buyout mogul who has made his name and fortune healing sick companies. Beset by heavy debts, Linens ‘n Things is teetering on the brink of bankruptcy. The company, which operates more than 500 stores in 47 states, was negotiating with its creditors on Friday and through the weekend in an effort to stave off insolvency.
Wall Street was also buzzing that two other companies that Apollo acquired when the economy was strong — Realogy, the parent of the real estate companies Coldwell Banker and Century 21, and Claire’s Stores, a fixture in malls for three decades — might stumble.
#39 gary: Could be. But my wife says it is not the amount of people at the amll that matters, but the amount of bags you see people carrying that really determines whether people are spending or not.
Just to send in my 2 cents we were at The Manor in Orange for brunch two sundays ago. That brunch is almost always packed especially during poor weather. To make a long story short it was empty at noon! We also we were at Kinchley’s Pizza in Mahwah after a long day of house laughing (I mean hunting. that place is a cash only business (no credit or debit) and is usually swamped at 5PM on a Sunday, again no foot traffic. I guess the laws of unintended consequences are beginning in the economy.
Kinchley’s Pizza is excellent!
sellers holding out for top dollar… bargain-hungry buyers
I the seller is holding out for top dollar why…
To coin a phrase, oh bother.
———-
Gary: What did you buy?
Kinchley’s: YES!
You know the economy is really f&cked up when Alberto Gonzales cannot find a job..
http://www.nytimes.com/2008/04/13/washington/13gonzales.html?_r=1&hp&oref=slogin
DO analysts really see raising sales of gasoline as a sign that economy is improving??
Soon people won’t be able to afford to drive to work!!! But GDP will triple!!!
Pathetic - at some point rising costs for necessities such as food/gasoline/and minimal clothes will cause retail sales to rise.
Rich in NNJ,
Gary: What did you buy?
—-
Huh? You mean at the mall?
How this for an economy kick in the butt. Went to the the pre-owned Lexus dealer near my house. at 3pm Sunday, very few customers. Guy had a new used shipment of 2007 Lexus in from auction. Said I could look but not detailed yet. Every single one had REPO stampled on it and all came from Toyota Motor Finance Repo April 8 auction in Florida. Guy said all the ES350/GS350 leased in 2007 are coming back by the truck-load as people can no longer afford to make lease payments. HA HA
John Says:
April 14th, 2008 at 9:21 am
Please note that, if your portfolio includes Auction Rate Securities, you may see an inflated market value for those securities. Your Auction Rate Securities will be re-displayed at par by Tuesday, April 15th. Please do not hesitate to contact your Financial Advisor with questions. We thank you in advance for your patience and apologize for this inconvenience.
Nice Smith Barney new disclamer. Tax day will be a shock!
JJ: where did you see this…can you direct me to a link?
#46 Al: I assume at least part of that increase in gasoline sales was/s due to people filling up in naticipation of prices going higher.
In other words somebody that might typically choose to throw qo 20 bucks worth of gas into their cars, are now electing to fill up the tank, in anticipation of prices going higher.
Harrison anyone?
http://www.nytimes.com/2008/04/13/realestate/13njzo.html?ref=realestate
The incentives offered ($28,344 one year P&I paid by builder) reflects a 6% discount off the asking price ($425,990).
Question: Why only 6%?
Is there a legal maximum on the percentage builders can offer?
After looking for houses for 3 weekends now I am going to sign a month to month leas - it is only 50$/month extra…
What is being offered is still at 2006+ prices. moreever mopst houses plainly not upkept - which means buyer not only expected to pay to dollar but also expected to pay for years of use by the previous owner. Ridiculous. I am going to wait untill the end of a spring season and I will start lowballing away.
I have two realtors who asked me to lowball - they literally said - please out any offer you want in and we will see what banks/owner will say - in several houses I looked at, it is a short sale so owner do not care what house sells for, nor they care for fixing anything.
But when I see expanded cape code converted into a ranch, and basement under converted part is separating from original house - I run away…. And this gem is yours for only….265K in P-way. In ugly condition inside.
By the way, whats your take on Dunellen - anybody??
what lexus dealership was that…wouldnt mind picking up an ES for cheap!
thanks
CAIBC
on second thought..its just a camry with better leather right? have to rethink the ES…
unless i can get it for camry prices???
I see that those who actually go to look at some of these homes now know what I’ve been saying; that most of these sellers still expect to extort a dream price from potential buyers.
If you’re going to be so brave as to make an offer, then make sure it is indeed a lowball offer and tell the listing agent that you’ll forgive the insulting asking price as you realize that it’s nothing personal.
32 grim/drew
drew, grim is being, as he always is, polite.
The business model that that program works from is of the Fool-And-His-Money variety.
If you’re going to be so brave as to make an offer, then make sure it is indeed a lowball offer and tell the listing agent that you’ll forgive the insulting asking price as you realize that it’s nothing personal.
MY offer would be on par with what it cost to rent ( rent = PITI and also allow some wiggle room to fix stuff)
TO get it it will probably have to be either short sale or REO. We will see.
24 drew
“why wouldn’t ever make sense to payoff your mortgage early?”
If the rate is really low, then you can look at it as cheap leverage for better investments.
For example, if you have a 3.5% fixed rate and you can get 4.5% in a FDIC-backed CD, then you’ve got free money.
WSJ
BREAKING NEWS:
CEO of Berkshire Hathaway’s General Re unit has resigned. Full article coming soon.
LIES!!!!!!!!!!!!!!
WSJ
Law Firms Curtail
Associate Programs
As Economy Slows
By ASHBY JONES
April 14, 2008; Page B1
For associates at law firms, how quickly things have changed.
This time last year, salaried lawyers at many of nation’s largest firms had just scored a pay bump, as business was blazing and firms were scrambling to keep talent. Now, due largely to a slowdown in work relating to mortgages, real estate, mergers and private equity, some firms are taking such measures as rescinding offers to incoming associates and summer associates, asking first-year lawyers to start several months later and shortening their summer programs to save money.
New York-based Pillsbury Winthrop Shaw Pittman LLP, which employs more than 800 lawyers, recently shrunk the duration of its summer-associate program, which in some offices had been 12 weeks, to 10. And rather than have all incoming first-year lawyers start in September, the firm is staggering start dates over several months. Chicago-based Sonnenschein Nath & Rosenthal LLP, a 700-lawyer firm, last month rescinded employment offers for two summer associates and two first-year associates in its Charlotte, N.C., office.
Associates are key revenue generators for law firms. Firms generally charge clients an hourly rate for associates’ work, and the more work firms can assign to associates, the more they can earn. But associates are expensive as well, especially now, after firms jumped to match each other’s raises for them when times were good.
The salary for many entry-level lawyers at large firms in big cities is currently $160,000 per year. Summer associates — typically law students between their second and third years of law school hoping for offers of full-time employment after graduation — often get paid by the week at a rate pegged to the first-year associate salary. In many offices, summer associates in 2008 will bring home $3,100 weekly. So shaving weeks of employment can mean real savings for a law firm.
[edit]
NJP 58 Considering how that exchange went I would advise early payoff.
47 gary
I want a detailed copy of Mrs. Gary’s grocery list as well.
61 mike
probably right.
Received a lease renewal….no increase…next year I may ask for a cut.
Re: Student Loans
It is the situation for most people’s student loans - in the past 5 years almost everyone was able to refi to sub-4%. For us it is at 3.5% and will go down to 3.25 in 4 month…
CD in FDIC insured Credit union are at 4.49%. Fo we make a little monay but NOT paying off our Student loans. (basically non - interest deduction, but all extra dividents money are taxed)…
Whats my house worth on HGTV, some of the people look like they just hit the jackpot
Although, I did see an episode last week.
Realtor: Your home is worth …(dramatic pause)… $395k
Bagholders: (jaw drops) What? But but .. our neighbor got $400k for their home last year…and our home is nicer… they have no upgrades…we have all the upgrades
Realtor: Well, that was last year. You probably could have gotten $450k. But this is Orlando and the market is softened a lot in a year.
Bagholder: (sad) We don’t have enough equity to sell. I guess we will just have to stay put.
60 chi
But not in Manhattan!!!!
45 victorian
Being unable to find a job must be torture…
As Greenspan’s reputation sinks, Volcker’s rises
The more Alan Greenspan whines about his tarnished legacy since leaving the helm of the Federal Reserve, the more his predecessor Paul Volcker looks to claim the title as the “greatest central banker who ever lived.”
http://www.msnbc.msn.com/id/24052851/
“In other words somebody that might typically choose to throw qo 20 bucks worth of gas into their cars, are now electing to fill up the tank, in anticipation of prices going higher.”
3b,
Good news for the homeowner. While their home value is declining, their full tank of gas is appreciating. In addition to this, if their cupboard is filled with corn, that’s also appreciating. I’m actually surprised that I haven’t seen an ad; “Free gas and corn for 1 year with house purchace.”
Al
or anyone else
What companies are letting you refi your student loans? Mine won’t let me.
“shrunk the duration of its summer-associate program, which in some offices had been 12 weeks, to 10″
“last month rescinded employment offers for two summer associates and two first-year associates”
So the journo decided to write an article about how bad things are for law firms and this is the best stuff he could find?!
“Received a lease renewal….no increase…next year I may ask for a cut.”
Chi,
I started renting in 9/05. I have not had an increase.
WaPo reports that the consequences of jingle mail are virtually nil:
“WASHINGTON—The country’s two largest sources of mortgage money have a blunt warning for anyone thinking about joining the “walkaway” trend, where homeowners stop making payments and months later send the house keys to their lender: You will feel the pain.
On March 31, Fannie Mae sent out new guidelines to lenders aimed at walkaways and other foreclosure situations. Fannie will prohibit foreclosed borrowers from getting another mortgage through it for five years, unless there are “documented extenuating circumstances.” In those cases, the prohibition is three years.
Even after five years, borrowers with foreclosures in their files will have to put at least 10 percent down and need minimum FICO credit scores of 680.”
Wah.
71 lost
You have to refi into another company. Your own student loan outfit doesn’t have enough incentive to lower your rate, but someone else might.
Are yours federal or private?
lostinny Says:
April 14th, 2008 at 10:42 am
Al
or anyone else
What companies are letting you refi your student loans? Mine won’t let me.
Original Loan was Sallie Mae and we refinanced (actually, I we had 2 loans with different rates, and we consolidated) with Colorado State Education Authority in 2006…
why would not they let you refi - just arrange for full payoff from lender who would refinance?
They must allow Payoffs. In tiday’s enviroment you need to fing a willing lender with low interest on 10years+ stident loan… Might be a bit hard. Look around. In early 2006 it was a breeze.
So far I don’t see it, GSP and Turnpike are packed, malls are jammed and everyone seems to have a huge SUV. Where’s the mass exodus?
Go ask any honest realtor who’s been in the biz for a few years how many young couples they took around looking at houses, only to have the couple get disgusted at what little their hard earned money would get them, give up & move out of NJ. You will hear a much different perspective on the exodus.
72 pretorius
You’re not involved with NYC corporate firms, so you may not be aware that at all other times there is a massive ongoing brawl for talent. The starting salary for no-experience raw kids straight out of law school doubled in the last ten years. For there to be any layoffs at all in that industry is extremely rare. Those law firms’ reps won’t recover from the damage to their recruiting capability for a long time.
Latham had layoffs in 1991, and a decade later, ever student coming out of law school was leary of taking a job there.
pretorius Says:
April 14th, 2008 at 10:42 am
“shrunk the duration of its summer-associate program, which in some offices had been 12 weeks, to 10″
“last month rescinded employment offers for two summer associates and two first-year associates”
So the journo decided to write an article about how bad things are for law firms and this is the best stuff he could find?!
pret: come on…..it is all about context….I remember making a similar point about the following issue to grim about 2 1/2 years ago relative to the credit markets.
The article in itself is nothing. However, the fact it appears at all is very significant. In context, is this information the first of many similar or possibly worse articles disclosing weakening conditions, or a one-off lark? I’m in the anticipation business, so I get paid to monitor this stuff…..you draw your own conclusions…
BC Bob Says:
April 14th, 2008 at 10:44 am
“Received a lease renewal….no increase…next year I may ask for a cut.”Chi,I started renting in 9/05. I have not had an increase.
Bost: but you do have two wins at the Frozen Four and a couple of ceremonial first pitches at Fenway….
Question regarding underground oil tanks.
If a house has an underground oil tank, is the seller required to remove it? At his expense or is it part of the negotiation?
Quick method to excavate an underground oil tank.
1. Open spigot to tank.
2. Light a flare.
3. Drop flare into tank.
4. Run.
#82 believe me, I would love to do that.
Gary,
Huh? You mean at the mall?
Yes. Gift, personal use, big ticket item (TV) or low ticket (underwear)?
I can’t help but find your disbelief at the amount of people at the mall a little funny considering you’re one of them.
Reminds of the time I was hanging out with my friend at a bar and took notice of this other guy and remarked “he’s always here”.
Njpatient, Chifi,
I agree the article could highlight what turns out to be first of several rounds of cutbacks. By the way I have a family member who works at Cadwalader, the former securitization kings. So I’ve witnessed first hand how stressed out lawyers get about this stuff (fortunately she hasn’t been fired yet.)
Njpatient, thanks for the tidbits. I still don’t understand why layoffs torpedo a law firm’s rep with young lawyers. Is it because law school training makes young lawyers with lots of loans to pay averse to taking risks?
75 Patient
They’re private. I don’t know of any companies that do refi’s.
76 Al
I also have Sallie Mae. It’s not the payoff that they won’t allow. I make more then the minimal payment monthly. It’s that they only consolidate and won’t refi.
I’d really like to find a company that will refi.
75 Patient. Oops. Sorry they are federal loans.
84 Rich
Which leads to my all-time favorite Yogi-ism (when asked about a popular restaurant):
“Nobody goes there anymore. It’s too crowded.”
87 lost
Then you should have no problem doing what Al suggested - go to another lender and ask if they want to buy out your loans and give you a better rate.
Lost - try calling ACS.
“Goldman Strategists Say U.S. Earnings Are Awful”
http://www.bloomberg.com/apps/news?pid=20601103&sid=agpT0SCT206E&refer=us
njpatient [62],
We’re big on dumpster diving so we don’t have a grocery list, per say. :o
Hey all, the whole law firm thing is a cycle - every 7 years sh-t strikes and there are layoffs and we lawyers freak out. It happened in ‘01 after the dot com bust, and it’s happening again, and in 7 years, something else will force more layoffs. I remember when stuff dried up the last time I had friends at big firms (including Cadwalader) billing less than 60 hours a month, and a lot lost their jobs. Thankfully, it’s usually limited to the firms that focused most heavily in the “hot” area or firms that got too big for their britches. I have a feeling the layoffs will be less this time, however, with all of the recently merged firms - their work bases are much more diverse and they’re not solely supported by just one type of work.
njpatient (88),
Bingo!
Patient
You would think it would be that easy but I can’t find a lender to buy the loan. They only want to consolidate. What is ACS?
[77]rent,
apropos to your observation:
went to 4 open houses this w/e in New Prov and Summit, and very little traffic in each. Some of the traffic was curious neighbors or other realtors, few real buyer prospects.
I noticed what appeared to be wetland on the back of one property in Summit (that had its own stream 20 feet from the house. Realtor told me with a perfectly straight face that I could put in a tennis court or swimming pool as the neighbors had done. I asked her if she would help with applications at DEP.
Also went to an open house in Summit near Memorial Park. Spouse suggested I see it and laughed when I asked why and what was so great about it. Agent (great guy, I would use him for his honesty) said immediately that it needed “several hundred thousand worth of upgrades” Tried to look at the kitchen—so hideously upgraded and decorated that it actually hurt my eyes. Really. Spent the rest of the tour discussing how incredibly out of touch with reality the owner must be.
Fun weekend. No offers forthcoming.
lostinny Says:
April 14th, 2008 at 11:12 am
Patient
You would think it would be that easy but I can’t find a lender to buy the loan. They only want to consolidate. What is ACS?
LOL - take 1 credit at Rutgers, take out different student loan … Consolidate :)
dan, #81
I have relatives who sold a house in July of ‘05.
They had an underground oil tank that had been drained and decommissioned back in the 1980’s.
They had to go back in and fill it with sand, but they didn’t have to remove it. Cost about $1500.
It’s an entirely different story if the oil tank has leaked - big job, with a lot of hassles with NJ EPA.
There are previous posts about this in the archives.
93 njgal
The lawyers may freak out, but the actual layoffs are rare. Any layoffs of any significance at all are a pretty bad sign.
Rich in NNJ,
Small ticket items. I’m really not getting what you’re saying about being there at the mall but um…. ok, whatever.
#96 The sellers in my area seem to be much more delusional and resistant to price drops than during the last real estate bubble burst.
They believe all they need is for one POS Cape to sell even close to asking price,and that then gives them hope that they can sell their POS at the same price;thus dragging out the needed price drops longer.
Lost
ACS is one of the big student loan servicing corporations.
Just google acs student and loan
Al - I like that idea.
92 gary
I’ve been using the five-finger discount recently.
AL
I may just do that.
Q: When would a politician WANT videotapes of his many gay affairs with prostitutes to become public?
A: When one of them falsely accuses him of rape.
http://tpmmuckraker.talkingpointsmemo.com/2008/04/all_muck_is_local.php
True, NJpatient, although I just had a friend get laid off from a big firm (he did distressed debt). He also suffered in the last round of layoffs because he was in a corporate dept. at that time and internet work dried up. Hopefully it won’t be so bad this time, because I really did have a lot of friends lose jobs last time around.
“take 1 credit at Rutgers, take out different student loan … Consolidate :)”
Same trick worked for me to obtain health insurance many years ago.
Now you must be full time.
I did improve my tennis and volleyball skills though.
[85]
IMO, the firms won’t lay off unless they have to for fear of hurting recruiting in recovery years.
My former firm got out the axe in the 90’s and it hurt them so much in later years that after 9/11, they rode it out rather than lay off attorneys. This firm had lots of attrition naturally, so they just did not hire. Also saw a lot of exit emails for folks that were not going to great jobs–this told me that they were trimming deadwood selectively rather than using the “L” word.
#70 BC Bob: actually surprised that I haven’t seen an ad; “Free gas and corn for 1 year with house purchace.”
Hey its probably coming!!
108 Name of the Feather
That’s been my experience as well. NJgal - I know it was a bad scene in CA in 2001 because of the folks who had expanded out there during the dotcom bubble, but in NYC I was only aware of one firm that had meaningful layoffs, and they went rapidly downhill thereafter.
3B
I think we’re much more likely to to pull into the local Exxon and see a sign that says “Free House with Fill-Up!”
When you log on on-line to your account at smithbarney.com it pops up.
chicagofinance Says:
April 14th, 2008 at 10:08 am
John Says:
April 14th, 2008 at 9:21 am
Please note that, if your portfolio includes Auction Rate Securities, you may see an inflated market value for those securities. Your Auction Rate Securities will be re-displayed at par by Tuesday, April 15th. Please do not hesitate to contact your Financial Advisor with questions. We thank you in advance for your patience and apologize for this inconvenience.
Nice Smith Barney new disclamer. Tax day will be a shock!
JJ: where did you see this…can you direct me to a link?
Can someone give me Total listing history and total DOM on MLS 2506909.
I know I’ve seen it before, I just don’t have the info anymore…
Thanks..
Also, anyone have any thoughts on Duplexes… Pro.. Con… Resale…
Don’t bother, Lexus dealers are trying to sell 2007 Lexus repos at full price which is around 32K. At auction they go for 24-25K. Dealer does not certify, just changes fluids and details. So they are marking it up 7K. Repo auctions are a dime a dozed. I do find it crazy that lexus in their pre-owned event calls old repos “lexus dealer quality cars”. Used to be repos were sold in used car lots on Queens blvd by some guy named Habeeb in a $99 dollar suit. My how far down Lexus has gone into the trash heap.
CAIBC Says:
April 14th, 2008 at 10:15 am
what lexus dealership was that…wouldnt mind picking up an ES for cheap!
thanks
CAIBC
From MarketWatch:
Pilgrim’s Pride to cut chicken production by 5%
Pilgrim’s Pride said Monday it plans to cut weekly chicken processing at its plants and may shutter another production facility to offset exorbitant costs for corn and soybean meal.
Pilgrim’s Pride, the largest U.S. chicken producer, said it will reduce weekly processing by 5% compared to last year’s levels.
…
Inflated costs for feed grains are impacting all chicken suppliers. Feed grains make up half of the costs of raising a chicken. Producers have been lifting chicken prices, resulting in higher costs for consumers at the grocery store.
Called ACS- they can’t do it either. I am stuck.
“Chi,
I started renting in 9/05. I have not had an increase.”
I can beat that– I started in 2/04 and haven’t had an increase. :-P I also transitioned into a month-to-month, and talked them into allowing a pet. It’s amazing what you can get if you’re quiet and pay your rent on time every month. I’d love to upgrade to a nicer place but I think we’re paying about 25% under market now, so it’s hard to give that up.
Is food the next bubble?
From the AP:
World Bank Leader Urges Action on Food
The president of the World Bank urged immediate action to deal with mounting food prices that have caused hunger and deadly violence in several countries.
Robert Zoellick on Sunday said the international community has “to put our money where our mouth is” and act now to help hungry people. “It is as stark as that.”
…
“It is critical that governments confirm their commitments as soon as possible and others begin to commit,” Zoellick said. Prices have only risen further since the WFP issued that appeal, so it is urgent that governments step up, he said.
…
He said a rough analysis the bank estimates that a doubling of food prices over the last three years could potentially push people in low income countries deeper into poverty.
Nice little op-ed piece in the times…
http://www.nytimes.com/2008/04/14/opinion/14leamer.html
So question now is will govt intervention to support housing market delay fall or will the housing Titanic run it’s course irregardless of what govt does? I think affordability and ability to get a loan is the problem here, so I have a feeling it will only marginally support housing. No more subprime buyers or ARM, zero down buyers in the market. This loan tightening will run it’s course.
Just a anectodal comment on the lawyer work…
My cousin works at a large firm in the loan docs dept. She told me last week, that she has been leaving work around 5pm on most days and did not even have to go in on a handful of days last month. Given it’s the beginning of the year that’s probably a bad sign, because new deals come in out the gate. Summer will be dreadfully slow, so law firms looking to save a buck may make some cuts. If banks are cutting back in securitization and lending, only makes sense that law firms will do the same. Can’t have 5 lawyers sharing one slice of pie. Someone has to go hungry…
all lexus buyers just go over to rt.46 in little ferry… Habeeb’s brother and Manny
will be able to help.
Haitians Riot, Loot Over Food Prices
Food Riot watch: Egypt protests spook government
Bangladesh workers riot over soaring food prices
The Fury of the Poor
Around the world, rising food prices have made basic staples like rice and corn unaffordable for many people, pushing the poor to the barricades because they can no longer get enough to eat. But the worst is yet to come.
“Is food the next bubble?”
Hopefully.
119 grim
“Is food the next bubble?”
Can’t wait for the milk speculation to begin, followed by a period of bemoaning drops in the price of milk
“my milk is now worth less than the loan I took out to buy it! What’ll I do!”
“HEADLINE: Mile Derivatives Sour
Bank of Fools announced $7B in writedowns on derivative securities related to bad milk”
USA could see it’s AAA rating pulled if country experiences deep and severe recession.
http://www.marketwatch.com/news/story/sp-financial-aid-gses-poses/story.aspx?guid=%7B973D3F56%2DBD3E%2D4955%2D8A67%2D9FFC38E423A2%7D&dist=hplatest
124 headline should have been “Milk Derivatives Sour”
Darn fingers…
Goldman says US earnings are AWFUL…
http://www.bloomberg.com/apps/news?pid=20601103&sid=agpT0SCT206E&refer=us
yikes…
120 Hard
While I wasn’t talking about firms that would have a loan docs department (yes, those firms would be in trouble), this bit “Summer will be dreadfully slow, so law firms looking to save a buck may make some cuts” is understated: it has been slow since the beginning of the third quarter of last year - the top of the business cycle parabola was hit in the middle of the second quarter of 2007, which is why the bonuses were still high for 2007 despite the fact that the pain was coming so quickly.
It’s a bit easier to see how slow a particular quarter is when you can’t just say “oh, well, good thing last quarter was a world-beater!”
re: law jobs:
Firms which do big layoffs take a massive hit in recruiting for years at the top schools. When I was coming out a couple of years ago, everyone knew which firms did big layoffs in the 2001-02 period and avoided them if they had the option. Several years of poor recruiting at these schools will do significant damage to a firm.
If you are a law student, it makes sense to avoid these places. The hiring happens 2 years in advance and you are racking up serious debt in the meantime. You want a guaranteed job, especially since all of the big firms pay the same starting out.
Regarding the severity of layoffs, my understanding was that the last round was mild in NY, but it was significant in Cali and Boston. This time it seems to me that NY might get hit harder when all is said and done because the financial sector is taking a pounding, whereas tech is holding up decently.
129 skeptic
Agreed in all particulars.
129 skep
which is why any layoffs at all from Biglaw qualify as news.
(by way of response to pretorius).
Anybody else find it interesting the G-7 announces they are worried about the dollar and yet oil, gold, etc are all up?
132 hehehehehehehehe
Yes. Mrs. Patient was noticing this oddity as well.
Major law firm hirings/firings are all very cyclical, boost bankruptcy departments on downturns and increase corporate/securies departments on upturns. Like many mentioned, the same thing happened during the do-com bust. Firm I worked at had Real Estate attorneys doing work on a major bankruptcy case, one of them said it was the first time they’d been to the firm’s library.
#131
“which is why any layoffs at all from Biglaw qualify as news.”
yes, firms are aware of the big PR hit associated with layoffs of any kind, so they are an absolute last resort. unfortunately, one side effect of this is that covert layoffs happen more regularly (at least this is my impression), and these seem to be more stigmatizing
Unfortunately there are only so many $160k associates that can be retained when there is no work to go around. They will not be chopping partners. This could be worse than 2001-2002, because bankruptcies are directly hitting financial firms and business slowdown is across the board not just limited to tech/telecom and associated businesses. My cousin works on corporate lending related docs, so the slowdown is being felt in the trenches. I always wondered how as a lawyer she had so much time for vacations the last several months. She recently went to Greece early last fall and to Patagonia a couple months ago. When deal flow is strong, you’re lucky to take one day off.
“They will not be chopping partners. ”
This actually happens, but is NEVER publicly couched as a termination.
njpatient Says:
The lawyers may freak out, but the actual layoffs are rare. Any layoffs of any significance at all are a pretty bad sign.
Formal layoffs are certainly rare, but the stealth variety (attrition, contract attorneys whose contracts aren’t renewed, reduced SA programs, etc.) is employed a lot more aggressively because of it’s relative invisibility. I definitely see that at my firm, which has never done formal layoffs as far as I know.
Re: Shopping–I was at the Outlet stores in Jackson this weekend, and it was swarming with people and SUV traffic. I also saw as many guys as women pushing around these giant strollers in the narrow aisles; almost got clipped twice. This may be politically incorrect, but there seems to be a lot of PW’d guys out there.
Also, in case anyone missed it, there was an interesting article in the NYT today about the housing market woes spreading to Europe:
http://www.nytimes.com/2008/04/14/business/worldbusiness/14real.html?ex=1365912000&en=cd63ae94e5fc5a31&ei=5124&partner=permalink&exprod=permalink
Dan Don’t under any circumstance buy a house with tank in ground.If it has been filled with sand & cert-ed by town get documentation on it. You can’t get homeowners with a tank with oil in ground people who have it now are grandfathered You can pay for it if you want but make seller do it if it leaks he is on hook.I did it for my buyer split cost of fill & new above ground. Be wary.
From AP via Yahoo
AP poll: More avoid buying homes
A growing majority say they won’t buy a home anytime soon, the latest sign of increasing pessimism about the nation’s housing crisis, a poll showed Monday.
In a vivid sketch of how the sputtering real estate market is causing distress throughout the country, the Associated Press-AOL Money & Finance poll found that more than a quarter of homeowners worry their home will lose value over the next two years. Fully one in seven mortgage holders fear they won’t be able to make their monthly payments on time over the next six months.
…
Sixty percent said they definitely won’t buy a home in the next two years, up from 53 percent who said so in an AP-AOL poll in September 2006. At the same time, just 11 percent are certain or very likely to buy soon, down from 15 percent two years ago.
The growing reluctance to dip into the housing market seems to stem partly from worry that housing prices will continue falling — good if you’re buying a house but bad if you have to sell one.
The number envisioning falling prices in their area has grown to one in four, while four in 10 think prices will rise, a decrease from two years ago. Expectations for rising prices are highest in the South, with Westerners likeliest to predict they will drop.
Underscoring the public’s unsettled feelings, the number saying local housing prices are about right has fallen to 35 percent. Half say homes are overpriced — especially in the Northeast — while those saying housing is underpriced have doubled to one in 10, particularly Midwesterners.
“Even with the market slowdown, home prices are almost double what they were in 2000, while New Jersey median household incomes rose only about 21 percent from 2000 to 2006″
Would this mean that a reasonable price for a house would be the year 2000 price + 21% or so?
SC 142 Sounds about right,but it may over correct so it is best to wait it out. No hurry time is on your size. Even if you wait
till it is all over prices will remain flat so hang out. I think the evidence is clear that the market will remain flat for a long time, in addition for NJ the retirement of boomers & downward population trend will kick in just when the market should start back unless NJ sees a new industry like Pharma (ALL over but the screaming)it’s Re
market has no reason to make major gains in the foreseeable future.IMHO
And the market rallies on all the good news(????)
The stock market rebounds into positive territory as it trades at its best level of the session. Buying interest has been mostly broad-based, although energy (+2.0%) and telecom (+0.8%) have made some notable gains. There is no specific news item that would account for the recent spike.
There doesn’t need to be a news item anymore. The market seems to move on ignorance these days.
From the WSJ:
A Slump in Economic Indicators
The National Association for Business Economics sounded a warning on a topic near and dear to its heart this morning: economic indicators.
A statement from the chair of the NABE’s statistics committee, Haver Analytics President Maurine Haver, asserted that “just when reliable and timely indicators are needed most, resources devoted to their production at our federal statistical agencies have been cut, requiring the termination of data series or a reduction in sample sizes used to produce the data.”
Ms. Haver catalogs the casualties of budgetary tightening, writing that “the Bureau of Labor Statistics (BLS) has been forced to terminate all hours and earnings data reported for local areas as well as payroll employment for 65 small metro areas. The BLS International Price Program has also eliminated a number of series including prices of transportation services such as passenger air fares, air freight, and crude oil tanker freight. The Census Bureau will discontinue its Survey of Alterations and Repairs in May. The Bureau of Economic Analysis will reduce the level of industry detail in its county data and will eliminate the benchmark capital flow tables that provide baseline data on industry-by-industry investment by type of investment. This may only be the beginning.”
139 CB
I dunno about PW-edor whether the term is PC, but I’ll say this: I love my kids, and if that makes me a target of public derision, then so be it. No one’s done it to my face, though, so I wouldn’t know.
If we don’t have any indicators, there can’t be a recession.
Problem solved!
sl (from weekend #106)-
Call me when you have a chance. I hope your bad situation we discussed is moving toward a good resolution.
CB in SJ,
A real man has his infant or wife (preferably both simulataneously) push him in the stroller.
And I almost forgot to mention, my weewee is much larger than your weewee.
138 BY
All true, but in banking, pharma, retail, etc., the force reductions are not happening thru “attrition”. Biglaw simply does not suffer in the same way at the bottom of the business cycle.
145 stu
Lol - no wonder the moves are frequent and violent!!
Anyone who worked at a dot com, post bust, knows what happens after they take the free food away…
From the Star Ledger:
Debate brewing over free coffee
Tiny Mount Arlington in Morris County spends about $200 a year on free coffee for borough employees.
The cost amounts to a few pennies annually per taxpayer. And the $1.87 the council spent on a brownie and candle for a councilman’s birthday last year probably could be found under the couch cushions of most residents.
But that didn’t stop one taxpayer from insisting the town stop funding refreshments for employees with public money, no matter how minuscule the cost.
“Birthday candles and a brownie are not a legitimate expense,” Gayle Livecchia said after she saw the expenditures listed among last year’s petty cash fund receipts.
“You want coffee, buy your own,” said Livecchia, a frequent critic of borough government.
148 grim
That’s how it works these days.
A case of “penny wise”?
njpatient Says:
All true, but in banking, pharma, retail, etc., the force reductions are not happening thru “attrition”. Biglaw simply does not suffer in the same way at the bottom of the business cycle.
Very true–it’s just, as you point out, lawyers have a tendency to “freak out” when billing gets slow and offices stay empty for longer than usual. My firm never had a huge R.E./securitization practice, but I’ve already seen a drain of associates from those groups trying to get out while (they think) the getting is good–mostly by going in house, which I’m not sure is the best move now.
On the other hand, in my area (Tax/Benefits/Exec Comp) we’re short people and the headhunters call day in and day out. Friends in IP (especially patent prosecution) say the same.
Re: Free coffee.
Somebody should hire her to scrutinize NJ State budget.
grim (41)-
I have a pal inside Realogy, who’s been reporting to me for months that they’re on life support. Apollo had no idea what a POS they were getting when Cendant snookered them on this deal.
Vic (46)-
“You know the economy is really f&cked up when Alberto Gonzales cannot find a job.”
Maybe the CIA can pay him a few bucks to be a guinea pig for some waterboarding?
BC (71)-
“Free gas and corn for 1 year with house purchace.”
I’d be more efficient and make it a freezer full of tortillas instead of all that perishable corn.
[157] get Meredith Whitney on the case.
Clot,
Stocking up for the next set of tortilla riots?
Clot is still living off his old Y2K stockpile
Stocking up for the next set of tortilla riots?
Next?
Well I’ll be damned, there were “tortilla riots”.
“The market value is what the market value is,” Poliandro said. “Nobody cares how much you owe on your mortgage. Nobody cares that you’re getting a divorce and want to start your life over.”
It is about time folks started to recognize this fact.
# 164
Fuled by ethanol, by the way.
Next?
A repeat (rhyme) of the Japanese Rice Riots of 1918.
# 25 “So far I don’t see it, GSP and Turnpike are packed, malls are jammed and everyone seems to have a huge SUV. Where’s the mass exodus?”
Maybe they lost the house and are living in the cars and cleaning up in the mall restrooms?
From CNN, 42 minutes ago:
Riots, instability spread as food prices skyrocket
Riots from Haiti to Bangladesh to Egypt over the soaring costs of basic foods have brought the issue to a boiling point and catapulted it to the forefront of the world’s attention, the head of an agency focused on global development said Monday.
“This is the world’s big story,” said Jeffrey Sachs, director of Columbia University’s Earth Institute.
“The finance ministers were in shock, almost in panic this weekend,” he said on CNN’s “American Morning,” in a reference to top economic officials who gathered in Washington. “There are riots all over the world in the poor countries … and, of course, our own poor are feeling it in the United States.”
World Bank President Robert Zoellick has said the surging costs could mean “seven lost years” in the fight against worldwide poverty.
…
“In just two months,” Zoellick said in his speech, “rice prices have skyrocketed to near historical levels, rising by around 75 percent globally and more in some markets, with more likely to come. In Bangladesh, a 2-kilogram bag of rice … now consumes about half of the daily income of a poor family.”
The price of wheat has jumped 120 percent in the past year, he said — meaning that the price of a loaf of bread has more than doubled in places where the poor spend as much as 75 percent of their income on food.
# 29 “Excluding sales of gasoline stations, which were helped by high energy prices, retail sales didn’t budge in March.”
And this is somehow good news? People spent more on energy and other spending was flat or dcclined and the WSJ is spinning this as positive? It does not seem that way to me.
Love it.
Paulson tells foreign economies not to attempt to manipulate the prices of goods through price controls, but at home, we’re attempting to do exactly that. Only difference is their good is food, ours is housing. Both are basic necessities.
Food price controls may worsen situation, warns Paulson
Governments should resist the temptation to try to control soaring food costs through price controls, which would likely make the situation worse, US treasury secretary Henry Paulson has warned.
Such measures were “generally not effective and efficient” at protecting people destined to suffer the most, Paulson said in remarks prepared for the World Bank’s development committee meeting.
“They tend to create fiscal burdens and economic distortions,” Paulson said.
Actually the only people buying trade up homes nowdays are guys being p-whipped by their wives. So it is not a bad thing. Heck no engagement ring over 5K would ever be sold if it was not for p-whipping.
Go p-whippers go!!!
And this is somehow good news? People spent more on energy and other spending was flat or dcclined and the WSJ is spinning this as positive? It does not seem that way to me.
It is fantastic news, we aren’t rioting yet.
Food Prices => Bio fuels=> waste of energy and time.
But hey be cynical and look at the bright side - like the main character of “Thank you for smoking” said: population control - may be people will stop having 5+ kids??
In addition high food prices are actually beneficial for USA as USA is major net exporter of agricultural products.
# 39 “BTW Bear is reporting earnings.”
Earnings on Wall Street? They do that nowadays?
Homeowners Stuck in Unfinished Projects
Monday April 14, 12:44 pm ET
By Deborah Yao, AP Business Writer
UNEASY ECONOMY: Sinking Housing Market Maroons Homeowners in Unfinished or Empty Projects
http://biz.yahoo.com/ap/080414/uneasy_economy_marooned_homeowners.html?.v=1
#174 Al: be people will stop having 5+ kids??
Who exactly in this country is having 5+ kids today?
“And this is somehow good news? People spent more on energy and other spending was flat or dcclined and the WSJ is spinning this as positive? It does not seem that way to me.”
At least inflation isn’t affected
There is no food riots in htis country yet either. I am talking about developing countries, + China, INdia, Asian countries Africa.
“Even with the market slowdown, home prices are almost double what they were in 2000, while New Jersey median household incomes rose only about 21 percent from 2000 to 2006″
Hey… I’ve been told it’s very competitive to live in North Jersey and if you can’t afford it, perhaps you should be looking outside of the state. I’ve also been told that those that can’t afford to live here are jealous wannabees.
rent (78)-
Yep. BTW, the group you mentioned is dwarfed by the numbers who did suck it up, buy that house…and discover that in NJ, it’s just not worth the sacrifice.
The only clientele I have (other than people in pre-foreclosure) is young professionals, getting out of NJ as fast as they can.
(172)-
“Actually the only people buying trade up homes nowdays are guys being p-whipped by their wives.”
I’d like to hear from some of the women in the whipping contingent. I’d also like to know how OFHEO might categorize a man who is p-whipped.
“There is no food riots in htis country yet either.”
No. However, the cattle, pork and chicken producers how come down with a case of the willies.
Rich (164)-
“Calderon stole the elections, and now he`s stealing the tortillas!”
Nom Deplume,
Didn’t know much about Meredith Whitney, but good to see someone not afraid to voice an unpopular opinion.
# 86 “Njpatient, thanks for the tidbits. I still don’t understand why layoffs torpedo a law firm’s rep with young lawyers.”
It is because layoffs are almost unheard of at AmLaw 100 firms. If one has $250,000 in school debt and scadds of firms fighting to attract you, why would one have any interest in pursuing a position in a firm where there is a greater liklihood of a layoff. Remember, young lawyers form relationships with successful partners and, in many respects, ride that partners success and, if things go well, end up taking over that partner’s clients later on — thus enhancing the younger lawyers compensation. If one ends up getting laid off, it means having to start over someplace else where those relationships are already formed. It is harder to go into a firm as a 4th year than as a 1st year to form those relationships.
http://www.countrywide.com/purchase/f_reo.asp
Hard Place,
Whitney is the analyst that has been calling out the banks on thier financial condition for some time now.
I was fervently hoping she was wrong but after Wachovia, I have become a true believer, notwithstanding the money I lost not listening to her.
Actually the only people buying trade up homes nowdays are guys being p-whipped by their wives. So it is not a bad thing. Heck no engagement ring over 5K would ever be sold if it was not for p-whipping.
Go p-whippers go!!!
If everyone was Albanian there would be no such thing as p-whippers and this will salvage housing. Everyone convert. Clot you be the first one.
From the AP:
AP Poll: Mortgage Payments Worry Many
One in seven mortgage holders worry they may soon fail to make their monthly payments and even more fret that their home’s value is shrinking, according to a poll showing widespread stress from the nation’s housing crisis.
In an ominous snapshot of how the sagging real estate market and sour economy are intersecting, the Associated Press-AOL Money & Finance poll also found that 60 percent said they definitely won’t a buy a home in the next two years.
That was up from 53 percent who said so in an AP-AOL poll in September 2006. Only 11 percent are certain or very likely to buy soon, down from 15 percent two years ago.
In today’s economic climate, even holding onto what they already have is a challenge and source of distress for significant numbers of homeowners. Nearly three in 10 said they are concerned their home’s value will decline over the next two years, while 14 percent of mortgage holders expressed worry that they might miss payments in the next six months.
make (189)-
I have an Albanian mindset. Does that qualify me?
Is there any guidance on ones ability to get out of a lease early if you are laid off or have to move out of state for work? I know that ‘a contracts a contract’ and you are obliged to stay the course, but is there any precedence for other arrangements? My guess is that this is something that is an individual discussion with the tenant and owner, but I wanted to check on the combined wisdom here.
#180 gary: yes. I have been told the same, and yet some of those very same people are incredibly interested as to when I am going to buy.
Although I must say I am no longer confronted in the Dunkin Donuts any more. And some of the biggest wind bags as far as real estae cheer leaders that I know, are now strangely silent.
http://www.voiceofsandiego.org/articles/2008/04/09/toscano/820theywillbesorry040908.txt
You fence sitters are going to be sorry!
Just a friendly reminder to those so inclined. Please vote no tomorrow on your local school budget;send a message. Stop the spending;stop the madness.
Just to show you the mindset. In my local town paper last week, a person wrote in exhorting everybody to vote yes.
One of the direct quotes from the letter was “even though our bank accounts are ever shrinking, we should still vote yes”. There you go!!
#150 Stu “And I almost forgot to mention, my weewee is much larger than your weewee.”
I think there is an inverse relationship between wee-wee size and SUV size, and this apparently applies to everything these days. Whatever happened to the umbrella stroller? Everything is super-sized any more: fast food, houses, autos, and now strollers! Where does it end?
Dragging a kid through stores on a Sunday is not something that indicates to me good parenting; taking them to a zoo would make it about the kid, not the parent. That’s what a real man would do.
Nom,
Just googled her name. Sounds like the Ivy Zelman of financials.
I personally think Whitney is just riding the bandwagon down. But if I am wrong god bless her, it is bad enough she got hit with the ugly stick but at least she missed getting hit with the stupid stick.
This one is much better John. I bet Reinvestor subscribes:
http://www.voiceofsandiego.org/articles/2008/04/09/toscano/827blamethemedia031308.txt
” The last portion of the conference, a question-and-answer session, admonished the media for depressing consumer confidence by focusing on only the negative aspects of housing data…
George Chamberlin, a panelist at the event and columnist for the North County Times, said that some news reporters biased their reports because they are jealous of homeowners.
Most real estate agents who spoke at the conference seemed to agree, with one agent suggesting that agents and builders pull all advertising from newspapers until positive articles are printed.”
#199 one agent suggesting that agents and builders pull all advertising from newspapers until positive articles are printed.”
Boy is that ever an empty threat!!
Re 196, Actually I think the SUV is freudian for little women. I love the 5 feet nothing Mom’s in their GMC XL Monster SUVs tailgetting the 6ft2in men in their Camry’s!!!! What comes around goes around.
Stu (199)-
“…one agent suggesting that agents and builders pull all advertising from newspapers until positive articles are printed.”
And RE agents wonder why the public thinks we’re just a giant, predatory cabal of leeches.
#192
I used craigslist to find someone to take over my lease. I had a good relationship with my landlord, they had to meet the person taking over my lease and give the OK. I also had to get them an increase in rent. I did all of that over the course of about 3 weeks.
I had a year round rental in Belmar on the top floor a block form the beach with an ocean view and a deck for $1200 a month. That made it just a bit easier.
171 grim
“Paulson tells foreign economies not to attempt to manipulate the prices of goods through price controls, but at home, we’re attempting to do exactly that. Only difference is their good is food, ours is housing. Both are basic necessities.”
Spot on. And note that, although we despise price _controls_ with respect to food, we’re not averse to some price _supports_ here and there…
John (201)-
SUV as strap-on?
#199 Stu
This caught my eye from that site.
http://www.voiceofsandiego.org/articles/2008/04/11/housing/883ummel041108.txt
While the phrase “fiduciary duty” always makes me laugh, I’m with the realtor on this one. It’s not your fault if you show someone 80 properties and they can’t work out that somethings overpriced.
Teaneck
SLD 564 WYNDHAM RD $549,000 7/30/2004
SLD 564 WYNDHAM RD $517,000 4/14/2008
Franklin Lakes
SLD 874 WOODFIELD RD $2,300,000 10/7/2005
SLD 874 WOODFIELD RD $1,925,000 4/11/2008
NJBound…
Don’t know about moving out of state, but a friend had a heart condition that allowed him to only give 1 month’s notice before terminating a lease….
Can you get yourself a heart condition?
#208 Rich OMG!!! In Franklin lakes are your sure? (sarcasm off)
86
“Njpatient, thanks for the tidbits. I still don’t understand why layoffs torpedo a law firm’s rep with young lawyers. Is it because law school training makes young lawyers with lots of loans to pay averse to taking risks?”
Sorry, pretorius - I missed this. No - layoffs cause firms to stand out like a sore thumb because they are so rare among top-10 firms. It’s a small community. Ask your relative at Cadwalader - they used to be a top firm, and it didn’t take much bad news for them to lose their seat at the top table.
It’s a lot harder to get a job at one of the top 5 law firms than it is to get a job at one of the top 5 investment banks.
209# spam.
My left anterior descending is blocking as we speak.
I am just ‘thinking’ about moving out of state at this point and the owners of the house that we are in are really nice so I don’t think that it will be a problem.
However I will keep the heart attach approach up my sleeve.
198 john
“I personally think Whitney is just riding the bandwagon down.”
No - she broke ground, and did so in the face of death threats.
“I personally think Whitney is just riding the bandwagon down.’
John,
She was the only analyst with any guts to call it right. She even received death threats. The rest of her peers had their heads stuck up their blackbox.
196 CB
Ah. Much better - don’t disagree with any of that. I thought your objection was that the stroller-pusher was the wrong gender, not that the venue was wrong. I’m a big fan of the zoo.
“I’m a big fan of the zoo.”
The last few times I shopped at the Jackson Outlets it was a complete zoo. So what is the issue?
stu - I think CB may not have been here for the Great Stroller Throw-Down of 2007.
http://money.cnn.com/2008/04/11/news/companies/CIT_headache.fortune/?postversion=2008041410
A nice article about CIT’s Downfall…
“Even CIT’s direct competitors are rooting for it. Says Mark Sunshine, president and chief operating officer of First Capital: “We’re hoping someone comes in and buys it. If it fails, it could take 3,000 or 4,000 businesses down. No one wants to see lives destroyed. It would be a train wreck.”
NJP:
I think you are right.
Fears of long recession rising
Growing number of economists worry that second-half recovery is out of reach and that recession will be longer and more painful than current forecasts.
http://money.cnn.com/2008/04/14/news/economy/how_bad/index.htm?postversion=2008041415
#220 njpatient: Gee!! They are just waking up to that fact. And to think our lonely little band here on this site has been discussing just such a scanario for quite some time now.
But of course NYC awill be immune to this.
Apparently I did miss the great stroller throwdown thread, but I will now be sure to look it up. Stu is right; that place was a freakin’ zoo. I remember when Jackson was basically Great Adventure plus farms, but now it is McMansionville with horrendous traffic. All that growth but still the same cowpath roads.
From MarketWatch:
Wachovia cuts unused home equity lines of credit
Wachovia Corp. said on Monday that it’s limiting homeowners’ ability to tap home equity lines of credit that they haven’t used yet as the giant bank tries to cut its exposure to the broadening housing crisis.
…
Banks are taking such action to reduce potential losses from the housing bust. But Cannon said that if enough lenders pull home equity lines of credit, it could make industry losses even worse.
“Lenders have presented the reductions in home equity lines of credit as a prudent response to the rising home equity credit costs, declining home prices, and the risks of rising home equity exposure from the drawdown of lines of credit,” Cannon wrote.
“While for an individual lender, such actions appear prudent, the consumer response to the reduction of lines can create additional problems for the home equity lenders and for the economy as a whole,” he added. “Cutting unused lines will add to, rather than subtract from, credit costs on home equity portfolios.”
# 205 “SUV as strap-on?”
Strap-on? Like a backpack? I dont get it.
Shore 224 are you trolling.Think sex!
Shore Lets hope you don’t get it.
Friday at Fitch? Almost a billion dollars of mortgage backed writedowns… on a Monday.
Fitch Affirms $2.1B & Downgrades $692.8MM from 4 New Century 2005 Subprime Transactions
Fitch Affs $1.8B & Downgrs $245.4MM from 6 Carrington 2005 Subprime Deals
“Fears of long recession rising”
patient,
The housing bubble, credit expansion, consumer splurge, etc.. led us out of the last recession, if you want to call that a recession. As housing declines continue, credit gets tighter every day, job losses accelerate, etc.., what will lead us out of this mess. Maybe everybody should trade in their SUV for a John Deere?
BC 228 You think we can grow are way out of this one by feeding the world?
BC,
You might be on to something, how many acres of cultivatable land do you think we’ve got on the median and shoulders of the Turnpike and Parkway? Garden State here we come!
miw [229],
Knock down a McMansion and plant grain. There aren’t any farmers crying the blues.
Farm Bill is up this week or next. Huge subsidies for farmers. This sounds promising.
222 CB
” All that growth but still the same cowpath roads.”
Sounds like Boston!
Food and anything agriculture is indeed the next bubble. I wonder what an ounce of good “weed” is going to go for in another year or two?
# 147
I am with you there. In fact, Mrs. Shore did not change 1/10th the number of diapers that I did. Biology dictated that I could not feed them so I took on the role of bringing them comfort at the other end of the process. As gross as it sounds when single or childless, it is special time to spend with one’s child and the kids notice the face of the person who takes away the discomfort and makes them feel good again.
# 225/226 Methinks I had better google the word as I get the feeling there is something to this word that I have missed.
EEEEEE GADS!!!!! Now THAT is an eye-opening experience. I guess one does learn something new everyday. Another good reason to keep one’s back to the wall.
Shore Now you get the point!
strolling down the street sippin on gin and juice, hey the babies need their pimpmyride strollers you know, you gotta give those little g’s their props kickin at the mall while giving it to the man.
# 238 I hope not, actually. But appropriate image with April 15 upon us. Nothing like sending out 20-odd certified packages to the various taxing authorities to put one in a great mood.
# 239 Lyrics?
Hey Mike,
Maybe someone can sell some of those things with RE bust logos and sayings on them, just to add to the joy of selling RE nowadys. As long as you feel like you are being F**ked, here ya go.
No wonder Brigadoon is so popular..
Prostitution ring busted in Westfield
Police raids on suspected prostitution operations in Linden and Westfield have resulted in the arrests of a total of seven suspects, including a 17-year-old boy, authorities announced today.
…
On Thursday in Westfield, two women were taken into custody shortly before 7:30 p.m., when officers raided a two-story commercial building in the central business district, where authorities said the suspects were peddling sex under the guise of a legitimate massage therapy office.
…
The adults were charged in connection with the alleged sex ring, but police said the teenager may just have been in the wrong place at the wrong time when officers arrived.
Things have never been so swell
I have never failed to fail
Pain (x3)
You know you’re right (x3)
Gen X shrugs, says ‘whatever’ to retirement
http://www.msnbc.msn.com/id/24111270/
Or the right place at the wrong time. Must be a budding politician.
Grim,
I know that place. They gave a quality message and a happy ending. They were good girls who provided quality custemer service.
In recessionary times services like these are needed to keep a positive outlook on life for some and pay the property taxes for some.
“I know that place. They gave a quality message and a happy ending. They were good girls who provided quality custemer service.”
Make,
LMFAO.
Police said they seized record books and credit card receipts from the Westfield location. Authorities in both Westfield and Linden said their investigations are continuing
Only in America can you charge sex on a Mastercard.Why would you want to leave a papertrail is beyond me.
NJ services sector employment just fell by 7.
Sol Robeson: As soon as you discard scientific rigor, you’re no longer a mathematician, you’re a numerologist.
Charts say stocks near bottom, poised to recover-Fortis
http://www.reuters.com/article/newsOne/idCNTSIN16290420080414
Some investors use charts rather than economic fundamentals predict movements in financial markets.
One of the most popular charting methods involves the use of Fibonacci numbers, based on the work of a 13th century Italian mathematician, which suggest markets tend to find support or resistance at certain “golden ratios” commonly found in nature.
#248 Make:Why would you want to leave a papertrail is beyond me.
It is impressive to use an AMEX Gold Card?
#243 I knew a guy who owned several massage parlors in NJ. He told me you need to sell them in a few years time 3 years max after you open one. The problem is no matter what you do the facility will eventually become corrupt with additional services.
“make money Says:
April 14th, 2008 at 5:06 pm
Grim,
I know that place. They gave a quality message and a happy ending. They were good girls who provided quality custemer service.
In recessionary times services like these are needed to keep a positive outlook on life for some and pay the property taxes for some.”
I know where I am taking the proceeds of my government bailout check!!!
re: 243 - methinks someone did not get their envelope.
Foam shoes just a fad, who woulda thunk it?
Wachovia Firings:
http://dealbreaker.com/2008/04/in_equity_dilution_out_wachovi.php
Thanks for the link, more from Crains:
Wall Street cuts for Wachovia
Wachovia Corp. announced Monday it will slash its workforce on Wall Street by another 12% as the bank tries to recover from a particularly ill-timed expansion into mortgage lending.
The reduction of 500 corporate and investment banking employees — most of them in New York and Charlotte, N.C. — means the bank will have cut its ranks of Wall Streeters by 25% from its high last year. It appears to represent the deepest retreat by any bank so far.
243 grim/brigadoon
OMFG
that’ll bring down the property values
“Wachovia Corp. announced Monday it will slash its workforce on Wall Street by another 12%”
They are clearly using the phrase “on Wall Street” VERY loosely.
#257 I worked for Wachovia. They needed to lose some of the former dead wood they aquired from First Union.
First Union you know the bank with the initials FU.
NJP,
This is what happens when you leave creative writers to their literary devices. When this writer says “Wall Street”, he is referring, simply, to low level jobs associated with finance. Namely, secretaries, clerks, middle managers, and masseuses.
261 grim
Exactly. And in California, at that.
I was thinking about selling then sitting it out for 6 months or a year then jumping back in….But now I read that rents are going up up up. and interest rates might follow too. So I would pay more than my current mtg and taxes in rent while I wait for prices to drop which might work out but I am not sure if the payoff would be lost any thoughts on that strategy. Do you know of anyone who has done this successfully or did it not work out.
Sometimes nice to read a comment thread where everyone is threatening to leave some state other than NJ.
http://tinyurl.com/6ajaro
263 buyor
If you didn’t currently own, I’d say rent. I’m not sure that I’d sell for the purpose of renting at this point, however.
I personally could care less if people leave NJ…..congestion would decrease….buh bye to the elderly drivers who clog the roads…..buh bye to the people driving the crappy stinking cars that in no way can pass inspections….later to the moronic mom’s in the mini’vans whose husbands find ‘better’ work south…..Hasta La Vista.
make money Says:
April 14th, 2008 at 2:50 pm
If everyone was Albanian there would be no such thing as p-whippers and this will salvage housing. Everyone convert. Clot you be the first one.
mm: dude…I f—ed up! I married this Irish/Scottish/Dutch/Italian girl….I swear on my life she has bigger stones than most guys I know. If I am p-wipped because I’m always afraid of getting Lorena Bobbitted, then sign me up!
263…train….left….station.
Eh….if p*ssy is the worst thing you are whooped by then so be it.
NJ patiend and essex: thanks for your opinion. thing is I was offered a decent price by my neighbors brother who really wants to move here and live next to family - raise the cousins together etc. just sounded like an opportunity for all involved. but still thinking on it.
sellorstay,
Too late, sit tight. First, you’ve already missed the ability to get peak price for your property. Secondly, your timeframe is entirely wrong, 6 months isn’t nearly enough time to wait out the market.
Clotpolled Jimmy Cayne Says:
April 14th, 2008 at 2:52 pm
make (189)- I have an Albanian mindset. Does that qualify me?
albani: next week I’m driving up to Ithaca to meet with three Albanian guys…will I make it back?
This explains everything, and I mean Everything.
From Bloomberg:
http://www.bloomberg.com/apps/news?pid=20601124&sid=akWXksOOzQIo&refer=home
273 Hunter
It must say “42″ in large font?
Anti-cortisol drugs, the path to permanent prosperity!
and a slim physique!!
Just in time too, the steroid dealers were starting to get worried.
Now, THIS…. is a realtor I can even love!! Awesome!! No cell phone to the ear, no slicked up hair, no fake, whitened teeth, just pure down home honesty. Read this guys bio below… beautiful! Donny boy, I’ll gladly give you 6% to sell my home!
http://www.jgr.com/donald.snelbaker?WT.mc_ID=81311000000000
272 As long as you dont take them to Moosewood, I bet you will.
sean 254 It’s Jerz… man what da think.
Exactly!
#232, glad to know. Is there anyone interested on investing farm land? I saw a house with 6 ac land asking 500k, it is half an hour away from Princeton. While RE market is down, price of land will go up. So, it is still a good deal.
You might call me a “long-time-listener / first-time-caller”, as I read the blog religiously but rarely post. Here’s my scenario: We sold in the winter 2007 with the proceeds in the bank. We’ve had our eye on one small town, and for two years (long before selling) have followed the market daily, visiting everything open, scouting neighborhoods.
We know the town inside and out; have great credit; a hefty down payment - we are ideal buyers. But this town has a glut of overpriced POS pre-war homes in the +$500’s, with little inventory below it. My fiance wants “charm” - meaning no closets, a short basement, a guaranteed drainage problem, and major reno. Property taxes are approaching or +$10k for most homes and are (naturally) expected to rise.
Staying with family while looking; and its wearing thin. Month to month rentals are non-existent; short term leases here carry a hefty premium. We’d prefer not to rent to avoid “moving twice” and the perception (right or wrong) of “throwing money away”.
As a NJRE devotee, buying just doesn’t seem prudent.
Any thoughts? Put the proceeds in gold (..or perhaps corn..) and rent forever?
#282 G$,
My husband and I are in a similar pickle. We’re renting now, then plan on staying with family until we have plumped up our down payment enough, while waiting for prices to come down more.
I say you stick it out with the fam - sure, it’s wearing thin, but then your wallet gets nice n fat. It’ll pay huge dividends when you see your house’s value fluctuate, especially if you’re buying sooner rather than later (not a good idea).
Then you’re in a good position to prudently buy when the perfect storm of bottomed-out prices combines with your increasingly “hefty DP”.
My $.02.
As with anything, though, life gets in the way. For us, it’s the tick-tock of wanting to start a family. Doesn’t sound fun while already staying with family (I feel you on the “wearing thin”).
Good luck to you…
Er, #282 references 281, I mean
Quick Question for the assembly….
Hoboken is part of which MLS?? Is it GSMLS?
G$ Says:
April 14th, 2008 at 7:30 pm
Staying with family while looking; and its wearing thin.
G$: do tons of weekend trips…it takes the edge off…also, you can find tons of good hotel and restaurant deals if you stay clear of NYC
#271 grim:6 months isn’t nearly enough time to wait out the market.
How much longer would you think,2009 ?
Hoboken is part of which MLS?? Is it GSMLS?
I wish.
Liberty Board/MLSGuide
281 G$..sounds like us but we started renting in 2006 and have a month to month after the first year..it is getting old but just when you get tired, or turn that last rock over, something may happen! As has been said so many times on this blog, you have to comfortable with the price, and your own situation.
270….OK, that is a horse of a different color…..big time…..perhaps a great opportunity. Big Question: Do you see yourself in the place in 5 years? Kids an issue? Schools? Can you walk away with something after you pay off the note….Sounds possibly golden.
Just did my nightly run through the GSMLS &
taking out loud to myself “screw you” while looking.I run the #s in my head & you know what makes them not work the F in taxes.As NJ taxes go up & up prices will go down.Why are we looking here I ask myself.Even if we time the market just right (I feel most here will)we still are in the sh*t.Prices have a long way to go once you put in the present & future taxes.
me love you long time
Month to month rentals are non-existent; short term leases here carry a hefty premium.
G$,
If you are looking for short term, skip the condos & apartment buildings. They all want 1 year leases or want you to pay a premium.
Private landlords, however, often prefer month to month rentals. They figure that they have more flexibility in booting a deadbeat tenant. You can use that to your advantage. Look for 2 family houses etc.
BC (228)-
Maybe a Sun Hydraulic (SNHY) http://tinyurl.com/6og4om or Joy Global (JOYG) lift, crane or giant lever.
DE is so plebe, so agrarian. You can’t pull a loaded cart out of a mine with a Deere.
Mike (229)-
Can people drink ethanol?
John (239)-
“…strolling down the street sippin on gin and juice.”
How does a cracker like you know Snoop Dogg?
think (250)-
Fibonacci this.
Clot 294 I don’t know but I’m willing to give it a try.
Mitchell (252)-
“The problem is no matter what you do the facility will eventually become corrupt with additional services.”
Mitchell, how does one further corrupt corruption?
I like the way they handle it down in your parts. Put a big billboard over a converted Stuckey’s on I-77, advertising massage, videos, private rooms and “truckers welcome”.
Hey, Pret:
“Wachovia Corp. announced Monday it will slash its workforce on Wall Street by another 12%”
Is that Wall St, North Dakota?
270..any time you can mix an element of emotion into the sale….you got him $$$…
G$ (281)-
Hang on a bit. Things are gonna get uglier (ugly in your favor, that is), soon.
If the family gets too annoying, you can pull a John List. Nobody will look for them for a while. Maybe you can even tell everybody you put them in assisted living.
ledward Says:
April 14th, 2008 at 7:27 pm
#232, glad to know. Is there anyone interested on investing farm land? I saw a house with 6 ac land asking 500k, it is half an hour away from Princeton. While RE market is down, price of land will go up. So, it is still a good deal.
Hmmlets see I want to invest into a farm land:
Farm land in Iowa - is 2000$/acre (it was 100$ last year)
6 acres in Iowa - 12000$.
heck, 100 acres in Iowa = 200K.
6 acres in NJ = 500K with probably at least 5-6K taxes (It is a house you said?)
That 6 acres just do not seem like a goof farmland investment.
#299. The way some of them look down here I might put on a john deer hat and relax. Of course the idea of them on a hairy backed trucker doesn’t give me warm fuzzies.
It is what it is. I’m sure the people leaving the facility are a lot less riled up than when they entered so the results are different than someone entering a go go bar.
#303 I am in on farm land in Ohio. Corn and soybean farms to be more specific.
Buy the farm land and rent the land out to farmers. You can even work a deal to get a portion of farmed product profits. You both win in that scenario. Neighboring farms would be most interested because they have the equipment right there.