Thu 1 May 2008
From the Star Ledger:
As gas prices continue to set records at the pump, more and more commuters are ditching longtime commuting habits and boarding trains and buses to get to work.
While NJ Transit officials say it’s difficult to measure the precise effect of escalating gas prices on ridership, they acknowledged that in recent months they have seen the number of passengers move in sync with rising gas prices. And with forecasts showing little chance for a let-up this summer, that trend could continue — meaning a major shift in habits for a state that has a long love affair with the automobile.
For the first three months of this year, preliminary numbers show a 5.3 percent increase in rail ridership over the same period last year, according to NJ Transit.
That comes after the number of passengers increased by 2.2 percent during the last three months of 2007. In October, the number of rail passengers hit a record 23 million, according to NJ Transit. On average, gas prices that month were around $2.60 a gallon. Gas in New Jersey now averages $3.649 a gallon.
Buses are also more crowded, with a 1.8 percent increase in ridership during the first quarter of 2008, according to NJ Transit.
“It’s difficult to attribute the increase to one single factor, but what we’ve heard is that gas prices are a factor, especially among first-time transit takers,” said Dan Stessel, a spokesman for NJ Transit.
…
The popularity of public transportation has actually been on the rise since 2005 when Hurricane Katrina wiped out refineries along the Gulf Coast, sending fuel prices soaring, said Virginia Miller, a spokeswoman for the American Public Transportation Association.“Right away we were hearing from transit systems,” Miller said. “Not only was ridership going up, but people were going to websites to get information about public transportation.”
The association counted 10.3 billion trips, the highest in 50 years, on buses, light rails and trains last year.
From the Trenton Times:
Merrill Lynch layoffs start
Employee layoffs at Merrill Lynch here have begun.
According to people who have friends and/or family at Merrill but who did not want to be identified, the financial services giant has begun letting go of personnel after announcing on April 17 a reduction of its worldwide work force by approximately 4,000 jobs. Merrill Lynch, as of the end of 2007, was the biggest employer in Mercer County with about 6,000 people.
A Merrill spokesman would not comment on any specifics yesterday evening. Spokesman Bill Halldin said that, “We’re actually not making any comment. We outlined totals in our earnings report. Beyond that we are not making any comment.”
…
While Merrill officials have declined to put a number on the human toll of their layoff program, Hopewell Valley residents whose friends and loved ones are affected described the surprise and shock that has rippled through the community in recent days.
One local businessman said his niece’s department based at the Scotch Road facility had been almost wiped out by the layoffs. His relative was about to put a downpayment on a new home when the company announced on April 17 that cuts would be imposed. She quickly withdrew her offer and moved into an apartment instead, the businessman said.
Her job was saved but others lost their positions and other departments at the Hopewell campus also were affected by the cuts, he said. His niece could not be reached for comment. The businessman requested that his relative’s name not be used because they feared job retaliation.
Another Hopewell resident in the corporate real estate business said he and others are working together to help an individual who was terminated from Merrill this week find a new job.
From the WSJ:
Bankers Pan Appraisal Revamp Plan
By JAMES R. HAGERTY
May 1, 2008; Page A6
The Mortgage Bankers Association denounced plans initiated by New York Attorney General Andrew Cuomo to reorganize the appraisal business.
The trade group said in a letter Wednesday that the plan should be withdrawn or at least modified. The association said the plan conflicts with federal regulatory guidance and that people in the industry weren’t given a chance to provide input before it was drawn up.
In a statement, Mr. Cuomo said: “The overwhelming response to the agreement has been a positive one, with almost everyone agreeing that significant reform is needed.” He promised to “thoughtfully consider” suggestions from the mortgage bankers and others.
In early March, government-sponsored mortgage investors Fannie Mae and Freddie Mac, the dominant providers of funding for U.S. home mortgages, announced an agreement with Mr. Cuomo aimed at discouraging inflated appraisals, widely viewed as one cause of the mortgage-default crisis. The two companies, seeking to avoid the threat of legal action by Mr. Cuomo, agreed to a code of conduct due to take effect Jan. 1.
The code bars lenders and their representatives from pressuring appraisers to supply inflated estimates of property values. Bank employees who are involved in making loans wouldn’t be allowed to choose appraisers under the code. Lenders wouldn’t be able to make loans on the basis of appraisals from their own employees or from other companies they control. The code also would bar lenders from using appraisals ordered by mortgage brokers.
The Mortgage Bankers Association said the code would increase costs for consumers. They also said Mr. Cuomo hadn’t provided any evidence that in-house appraisers are more likely to be “coerced” than those from outside companies. Lenders already have an incentive to seek honest appraisals because they risk losses on loans if they are based on inflated home values, the trade group said.
From the Press of Atlantic City:
Remittance businesses feeling the slowdown
Along Atlantic City’s Atlantic Avenue, the Hispanic-owned stores doing remittances - money that can be sent internationally - are plenty. It’s the customers that seem to be getting fewer, some shop owners say.
“Since three years (ago), it’s been really slow,” said Janeth Vargas, whose family has owned A&D Video for about 13 years. “Maybe now it’s the economy.”
That’s part of the reason - the other is a “harsher climate toward immigration,” according to a survey released Wednesday by the Inter-American Development Bank, a financial institution in Washington, D.C., that tracks remittances nationwide.
The survey’s findings indicate America’s economic slowdown has caught up with immigrant and migrant workers, many of whom send money back to families in poorer countries that rely heavily on money transfers. In Mexico, for instance, remittances are second to oil as the country’s largest source of foreign income.
“If the current trend holds over the next year, we would expect millions of families throughout Latin America who until recently had been receiving remittances to fall below the poverty line,” Donald F. Terry, a senior official at the Inter-American Development Bank, said in a statement.
Hoarding is a sign of well contained inflation, nothing to worry about.
From the WSJ:
As Food Prices Rise, Shoppers Stock Up
By GARY MCWILLIAMS and DAVID KESMODEL
May 1, 2008; Page D1
…
Even as rising food prices have triggered protests in developing countries, Americans are rediscovering the economic virtues of a well-stocked food pantry and storage freezer, and embracing discount and wholesale retailers for cut-rate meals.
Stockpiling staples such as rice, meats and canned soup is coming into vogue again as food inflation and $3.60-a-gallon gasoline have consumers cutting the frequency of shopping trips — and loading up carts when they do shop. Sometimes shoppers are prodded by fears of impending food shortages, though none have yet materialized in the U.S.
The Department of Agriculture predicts a 4% to 5% increase in food prices this year, nearly twice the rate for 2005. The largest increases are forecast for fats and oils, estimated to rise 8% to 9%, and cereals and bakery products, projected to jump 7.5% to 8.5%. That’s on top of existing increases: A dozen large eggs cost $2.20 in March, up from $1.63 a year earlier. White bread now costs $1.35 a pound, compared with $1.16 a year ago.
For most Americans, stockpiling fell out of favor decades ago as the rise of lower-price supercenters, wholesale clubs and discount chains curbed food-price inflation. Customers who made a trek to discounters — Aldi Group, Costco Wholesale Corp., or Wal-Mart Stores Inc. — no longer needed to stockpile. The new competition forced grocery chains to push down costs, helping to drive down food inflation through the 1980s and 1990s.
From the NYT:
Low Spending Is Taking Toll on Economy
For months, beleaguered American consumers have defied expert forecasts that they would soon succumb to the pressures of falling home prices, fewer jobs and shrinking paychecks. Now, they appear to have given in.
On Wednesday, the Commerce Department reported that the economy continued to stagnate during the first three months of the year, with a sharp pullback in consumer spending the primary factor at play.
Pressures on households in which cash is tight appeared to weigh significantly in the calculations of the Federal Reserve as it rolled back interest rates Wednesday for the seventh time since September — this time by one-fourth of a percentage point — in a bid to prevent a further falloff in the economy.
The Fed made clear, though, that investors and borrowers should not expect another drop in interest rates anytime soon. In the statement accompanying their action, policy makers said they believed that with the short-term rate at 2 percent, they had already unleashed enough economic stimulus to “help promote moderate growth.”
With the overall economy growing at a mere 0.6 percent annual rate for the second quarter in a row, consumer spending advanced by only 1 percent, the government estimated. That was down sharply from the 2.9 percent gain for all of 2007 and the 3.1 percent gain for 2006. It was the weakest showing since 2001, the last time the economy was ensnared in a recession.
Even more ominously, Americans cut back on a wide variety of discretionary purchases, conserving their cash for necessary spending.
http://www.newyorkfed.org/mortgagemaps/
Great link to foreclosures from are friends at the Fed.
That’s “our friends”, need more coffee.
From Bloomberg:
Poole, Bies Say More Fed Rate Cuts Wouldn’t Stem Slowdown Much
Former Federal Reserve officials William Poole and Susan Bies said it wouldn’t be wise for policy makers to cut the benchmark U.S. interest rate below the current 2 percent.
“We have an adjustment in housing that has to take place,” Poole, former president of the St. Louis Fed, said during a one- hour Bloomberg Television special, “Surviving the Slowdown,” yesterday. “I do not think rate cuts are going to solve the basic problem.”
…
“I really don’t think the Fed should continue to cut,” said Bies, a former Fed governor. Given the inflation rate, “the risk is it’s taking away from people’s spendable income.”
…
“For 95 percent of Americans, I think it is a recession,” said Roger Altman, co-founder of Evercore Partners Inc. “You see such general disquiet across the country.”
Business fixed investment, which includes spending on commercial construction and equipment and software, dropped last quarter at a 2.5 percent annual rate, the biggest decline since the first three months of 2004.
“It will be a slow recovery,” Altman said.
How about some GOOD news for a change:
Stem cell firm to open in NJ
http://www.philly.com/philly/wires/ap/news/state/new_jersey/20080430_ap_stemcellfirmtoopeninnjaftergetting589kingrants.html
From MarketWatch:
Layoffs jump to 19-month high in April
Led by cost-conscious financial companies, major U.S. corporations announced 90,015 job reductions in April, up 68% from March and the most since September 2006, according to a monthly tally released Thursday by outplacement firm Challenger Gray & Christmas.
Announced layoffs through the first four months of the year have grown to 290,671, up 9% from a year ago.
Financial companies announced 23,106 layoffs in April, including major reductions by Merrill Lynch and Citigroup. April marked the largest cuts in the sector since last September.
Telecommunications companies announced 8,007 layoffs, more than half at AT&T.
While the bust of the housing bubble is responsible for most of the cuts in financials, it’s rising energy costs that are responsible for the reductions in transportation, manufacturing, agriculture and services, said John Challenger, chief executive officer of the company that bears his name.
tBw 9 12 jobs!
NAR deems the housing market in NJ due for an uptick due to increase in jobs in the fast growing stem cell research ind. These tax breaks may lead to major increase in employment perhaps growing to 3 times the level, to a whopping 36 jobs.
tBw Only kidding!
Mike,
Good news?
A California-based stem cell research company will get $589,000 in state grants to open a New Jersey facility and create 12 new jobs.
We (taxpayers) paid $49,000 per job to bring those 12 jobs to New Jersey.
From MarketWatch:
Bankrate: Fixed mortgage rates creep higher
Fixed mortgage rates inched up in the past week, according to Bankrate Inc.’s survey released Thursday. The average conforming 30-year fixed mortgage rate increased to 6.16% from 6.11% a week ago, while the average 15-year fixed mortgage rose to 5.71% from 5.70%. The average rate on 30-year jumbo loans rose to 7.35%. Adjustable mortgage rates also tacked on gains, with the average one-year ARM jumping to 6.96% and the 5/1 ARM rising to 5.96% from 5.92%.
Things are really starting to get dicey and it seems that not enough is being done. The damn stimulus payments are simply going to be offset by crazy fuel and food prices.
If we’re not careful cheapskates and housing terrorists might get the upper hand in this environment and that can’t be allowed to happen. They will destroy this country and that must be prevented at all costs.
What they really needed to do is direct the stimulus towards those who built this damn economy; that is to say they need to help out the investors. If the stimulus were directed towards real estate investors, then we would likely see a the much desired multiplier effect.
‘If we’re not careful cheapskates and housing terrorists’
Joining th dark side?
Grim 12 That was my other thought upon reading. Did the NJ Gov ever hear about ROI.
At this rate will be bankrupt in no time.
Re 101 You’re a hoot! lol
“If the stimulus were directed towards real estate investors, then we would likely see a the much desired multiplier effect.”
50.5,
I agree. Give every flipper 500K to work with. Forget about this $600 nonsense. In addition to this, give every tax payer a $1,000 debit card, to be used for food and gas. You are on to something!
out last night for 1 pizza, three salads (nothing fancy just iceberg lettuce and a few tomato slices)…including 2 beers, 2 glasses of wine and two sodas (no free refill) what do you think the bill was? $60 bucks with a tip….outrageous
50.5,
Maybe we can provide some of that stimulus to our chaps, across the pond?
“Britain’s big banks stand to lose as much as a fifth of their profits as the commercial property market implodes, the Bank of England has warned.”
“The Bank sounded the alarm on a £5bn-plus wave of real estate defaults which could engulf the financial sector before it has even recovered from the sub-prime crisis.”
“The office and professional building market is in the midst of its biggest crash in more than a decade. However, banks have reported no major write-offs from the slump. The Bank warned this will not persist.”
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/05/01/bcnbanks101.xml
19
Hunter where did you go, the Plaza?
From MarketWatch:
U.S. weekly initial jobless claims surge 35,000 to 380,000
Erasing the drop in claims reported last week, first-time filings for state unemployment benefits surged 35,000 to 380,000 in the week ending April 26, the Labor Department reported Thursday. Wall Street economists had expected a result of 360,000. The four-week moving average of initial claims fell 6,500 to 363,750. For the week ending April 19, continuing jobless claims rose 74,000 to 3.02 million - the highest level since April 2004. The four-week average of continuing claims rose 16,750 to 2.98 million - the highest since May 2004.
Sounds cheap to me, Pizza is around 12, salads around 7 each or 21, beer is 5 each or 10 and wine is 5 each or 10 for a total of $52 with tax and tip you are at $68.
Inflation erodes wage gains as consumers dip further into savings to continue the spending spree.
From MarketWatch:
U.S. March real consumer spending rises 0.1%
U.S. March core consumer inflation rises 0.2%
U.S. March nominal incomes up 0.3% as expected
U.S. March real disposable incomes flat
U.S. March personal savings rate falls to 0.2%
U.S. March consumer prices rise 0.3%
http://www.theatlantic.com/doc/200803/subprime?ref=patrick.net
article about the future slums in north carolina that will grow out of the tracts of empty mcmansions.
reinvestor101:
Your wild bailout fantasies will never defeat our jihad against the bag holders. No bailouts ever, ha!
“Is Bernanke Worse Than Greenspan?”
“Money manager William Fleckenstein takes aim at the Fed chairman and his predecessor.”
http://www.usnews.com/articles/business/economy/2008/04/30/is-bernanke-worse-than-greenspan.html
Don’t worry the housing bulls don’t need money, my neighbor who bought in June 2006 at the peak of the market who he and his wife work six days a week to pay the mortgage just ran out and leased a 2008 benzy, those people love debt up to the eyeballs, they don’t need checks to keep spending. Like a crackhead they will beg borrow or steal to fund the habit. Giving them the cash would just take the fun out of it.
Spain, over/under, how long until it goes bust?
“Leo Levett-Smith and his wife, Jean, thought they did everything right when they bought their retirement home in Spain. They used a registered real estate agent, a Spanish notary and obtained their mortgage through one of then country’s largest savings banks.”
“Then in January they received a demolition order saying the house had been built without a permit.”
“Over the past decade, developers built about 100,000 illegal homes in Spain, and consumer advocates say thousands of those are now threatened with demolition as regional governments try to deter clandestine construction. The crusade may discourage the foreign buyers who fueled Spain’s housing boom, deepening a slump that began last year”
http://www.bloomberg.com/apps/news?pid=20601085&sid=a_y8j4QpEjVo
re: (25) John,
At least those homes don’t have wheels on them and can’t be driven up I-95 back to New Jersey. Mitchell will read that article just like the other we have cited from the Charlotte Observer and say that is not his neighborhood and everything is fine as long as you don’t live in those neighborhoods.
Atty: Jackson will feel impact of housing rules
BY DAVE BENJAMIN Staff Writer
JACKSON - New rules regarding affordable housing in New Jersey will be detrimental to Jackson, according to the attorney who represents Jackson on affordable housing matters.
Appearing before the Township Council at its April 22 meeting, attorney John Russo gave municipal officials an update on how the affordable housing rules relate to Jackson.
“As youmay be aware, on Jan 25, 2007, the New Jersey Appellate Court over- turned many aspects of the state Council on Affordable Housing’s (COAH) thirdround rules that were adopted in December 2004,” Russo said. “The court remanded [thematter] back to COAH with instructions to promulgate new rules consistent with their findings.”
COAH staffers “determined that 115,066 affordable units must be provided between 2004 and 2018,” Russo explained. “Previously they identified 52,000 units to be delivered through 2014.”
Russo said in that regard COAH increased themunicipalities’ obligations and although the rules are rather difficult, an analysis from a land-use law firm in New Jersey that calculated everymunicipality’s affordable housing obligation concluded that Jackson has a 1,041-unit third-round obligation.
I have been on beat of this COAH defined requirements for some time now. I think whenever they are finalized, it will have significant impact on NJ RE. I believe Supreme court has given them till June this year to finalize 3rd round numbers. Mayors of all so called good towns are kicking and screaming. But finally they will have to grudgingly agree. I feel it would be very difficult for towns to pay for these homes from property taxes collected, as it is NJ taxes are highest in the nation. Hence majority would opt for Builders to build them for free in lieu of increased housing permits. That raises number of new Home supply to at least 4 times, no of affordable housing required by towns. I would think this would create huge oversupply of new houses (not that everyone will be built due to RE downturn). More importantly, this will have psychological impact, that so-called good towns in suburbs will have to allow more housing to be built. I think Psychology has been a major reason why home prices have not dropped like most other part of country. Once that changes, this house of cards will crumble.
Preliminary NJMLS Bergen County Sold and Under Contract (Pending) Data for April
Year Sold# U/C#
1985 236 482
1986 362 707
1987 621 676
1988 681 627
1989 519 476
1990 439 480
1991 523 1040
1992 651 877
1993 571 879
1994 555 1065
1995 440 772
1996 595 1022
1997 646 974
1998 749 1060
1999 642 1015
2000 569 925
2001 532 861
2002 849 1035
2003 676 987
2004 761 1070
2005 811 1092
2006 613 878
2007 682 843
2008 461 723
I like how you can characterize life in the USA right now: No middle Class. Small but very, very rich elite. Huge class of people that elected a guy that they wanted to have a beer with….and are now paying dearly for that.
Housing obligation concerns
BY JENNA O’DONNELL Staff Writer
TINTON FALLS - As many as 200 additional units could be added to the borough’s COAH (Council on Affordable Housing) obligation by the preliminary Fort Monmouth re-use plan, according to planners at the April 23 Planning Board meeting.
Representatives of the FortMonmouth Economic Revitalization Planning Authority (FMERPA) and their planners, the San Francisco based EDAW, Inc. attended the Planning Board meeting to present the preliminary redevelopment plan and hear comments and questions from borough Planning Board members, planners and residents.
“That was purposely done because we’re holding out some hope that… when these three communities lose a lot of jobs and people will be moving … we might be able to capture 15 to 20 percent of those units as affordable,” Poole said. “There are a variety of ways to creatively mitigate the numbers.”
Andy Bayer and Paul Gleitz, the affordable housing consultants hired by the borough made the point that the fort property could not fit the housing that it would generate and that an additional component would have to be built elsewhere in the borough.
Wrapping up the first three months in world history with oil at $100 a barrel and rising fast, Exxon Mobil on Thursday said first-quarter profit gushed 17% higher, but the petroleum giant fell short of its all-time record set last year.
Exxon Mobil said profit rose to $10.89 billion, or $2.03 a share, from $6.8 billion, or $1.62 a share in the year-ago period. Analysts expected net income of $2.12 a share, on average, according to a survey by FactSet. Net income estimates ranged from $11.65 billion on the bullish side down to $10.79 billion on the low end.
Boro to offer comments on reuse plan for fort
Eatontown’s portion of the Fort Monmouth reuse plan calls for the construction of approximately 300mixed-income residential houses, 150,000 square feet of retail shopping, 145,000 square feet of office space and 126 acres of open space, explained Tim Delorm, vice president of EDAWInc.
Included in the reuse plan is the concept of individual town centers to be located in each of the host towns.
The town centers would be connected by updated roadways, jitney service and a continuous “blue-green belt” of open space and trails.
The reuse plan also calls for attracting “green industry” companies to corporate parks, as well as the creation of 450 acres of open space by incorporating clustered development.
The plan also includes 1,500 units of mixed-income housing, 1.5 million square feet of office space and research and development facilities, two hotels, and the preservation of many of the existing housing and high-tech facilities, throughout the fort. Planners anticipate that about 40 percent of the plan would be realized within 10 years and stated that they would be trying to attract high-tech companies to occupy the facilities and equipment in the existing Myers and McAfee centers.
The three host towns are being encouraged to look into sharing services and revenues on Fort Monmouth lands.
35….thanks grim! Donation today.
re: (29) BC Bob,
What is going on is Spain is really nuts. Spain has already begun efforts to clear the outermost 100 meters of its coastline – both Mediterranean and Atlantic – of all human-made elements, housing, roads, you name it.
Allot of that property is owned by Northern Eurpoean “tourists” who had summer homes build along the coast.
There is also talk of establishing a minimum 30-year waiting period before the official classification of a plot of land could be changed.
The coast of Spain in the eastern regions of Murcia and Valencia are now all set to be cleard of housing up to 100,000 housing units to be razed. About 435 miles of Public land will be cleared of overdeveloped concrete jungle to create a more “natural state”.
A truly unbelievable amount of government corruption and payoffs was going to to allow the building all of those vacation homes.
MXD Proposed for Former Landfill
SOMERVILLE, NJ-The response to an RFP for redevelopment of this city’s 112-acre former landfill was minimal in terms of firm proposals, but one has emerged as the front-runner with three major real estate names attached. Pulte Homes, AvalonBay Communities and Rockefeller Group Development would team up to build nearly 1,200 residential units and 195,000 sf of commercial space in three phases.
As proposed by the trio of developers, the project will be divided into four sectors, according to this city’s economic development manager, Colin Driver: The Hub, focused on this city’s commuter rail station; and three surrounding neighborhoods dubbed the Heights, Heights East and Heights West. The first phase will include 500 rental apartments, 72 condos, 800 parking spaces and 28,000 sf of retail space in the Hub.
Also in the first phase, more than 200 condos and townhouses will rise in the Heights East neighborhood. Phase two will add a total of more than 400 condos and townhouses in the Heights and Heights West neighborhoods. The final phase will add nearly 170,000 sf of commercial space. A timeline for the approval process and subsequent three-phase development has not been released.
Essex Says:
May 1st, 2008 at 9:10 am
I like how you can characterize life in the USA right now: No middle Class. Small but very, very rich elite. Huge class of people that elected a guy that they wanted to have a beer with….and are now paying dearly for that.
Essex: There was a good article on the European Middle Class and their struggles in the biz section of the NYTimes this AM.
They don’t sound happy either.
globest.com
This site seems to have lot of NJ Real Estate related news.
Huge class of people that elected a guy that they wanted to have a beer with….and are now paying dearly for that.
I found it always amusing that most folks who actually get benefits from Bush’s policies (such as on Taxes, Healthcare, Energy etc…) live in Blue states, while the folks who suffer live in Red state.
All Democratic positions such as higher taxes on Rich, Universal/Increased govt supported Health Care, Reducing Fuel Tax etc… are more helpful for folks living in Red states than folks in Blue states. But still folks in south and middle part of US still seem to be considered as Red state.
Follow up to post #9…
http://www.globest.com/news/1145_1145/newjersey/170263-1.html
News like this (global pharma company adding 400 jobs in NJ) comes out every month but doesn’t get much attention on this site.
NJ’s BEIP grants - which are really tax cuts, not grants - make sense and were worth in this case.
Unfortunately incentives are one of the ways states are making themselves attractive to businesses these days. Southern states routinely produce 8- and 9-figure incentive packages to attract capital investment and manufacturing jobs into their states.
Essex:
The truly sad part about record oil company earnings is that in past recent history, when oil prices increased, the oil companies would profit less as they lowered their profit margins to ensure high levels of demand.
In todays spend what you don’t have economy, the oil companies realized that consumers will ruin their own children’s futures to make sure they can gas up the SUV for frequent trips to Chuck E. Cheese and the like.
The U.S. consumers unwillingness to be deterred by $3.50 per gallon gas does not surprise me one bit. It used to, but then I realized that most American’s live by ReInvestor’s ideals.
SG, you beat me to it. Other good places for NJ real estate news are:
http://www.renj-digital.com/renj/200804/?u1=texterity
Quarterly supplemental info released by publicly traded real estate companies that own a lot here, like Mack-Cali and AvalonBay.
When you have to earn $2ook to be middle class we are truly f#cked.
Upcoming Key Dates
Pending Home Sales 05/07/2008
NAHB Housing Market Index 05/15/2008
Housing Starts 05/16/2008
Building Permits 05/16/2008
Existing Home Sales 05/23/2008
New Home Sales 05/27/2008
(27) BC Bob
Loved “Greenspan’s Bubbles.” Fleckenstein is right on.
“If you’re taking steroids and do really well, but three years later you get cancer, was it worth it?”
Time and time again, after the bubble comes the bust - but they just don’t seem to care…at the time anyway…
Cindy [48],
Did you read the book?
New Jersey apartment landlords still have pricing power. Rents are rising faster here than country overall, according to recent figures from 2 apartment landlords who each own thousands of apartments in this state.
Rents up 6% in AvalonBay’s New Jersey portfolio.
http://www.snl.com/Cache/1500017616.PDF?FID=1500017616&O=PDF&T=&D=&IID=103145&Y= (see page 9)
Rent’s up 4.4% in Home Properties’ New Jersey portfolio.
http://media.corporate-ir.net/media_files/irol/97/97082/Q108/HomeProperties1Q08SupplementialFinancialInformation.pdf (see page 11)
grim I’m in mod
Cindy (48) - The ruling class seems to have a ‘live for the day’ attitude, which has ‘bubbled’ over into the remainder of society. Blowback, in it’s harshest form.
(49) BC Bob..
“Did you read the book?”
Oh Yeah, got it right here. I’m hoping sooner or later Bernanke will realize his legacy can ALSO get lambasted like this and snap out of it..
From Bloomberg:
Home Depot Cuts Growth Plans; Will Close 15 Stores, Fire Staff
Home Depot Inc., the world’s biggest home-improvement retailer, said it cut its growth plans and will fire workers after closing 15 stores.
About 1,300 store employees will be affected by the closings, Home Depot said today in a statement on PR Newswire.
(52) Wag - I agree….”I want it all..and I want it now.”
Well up to 250k is middle class in NY/NJ. A a 22 year old college graduate starts at 60K with a 10% bonus, with a few good raises can easily be at a total comp of 100k by 30. Unlike 20 years ago todays kids meet and marry at work. So that 100K 30 year is marrying another 100K person, so the middle class who is 45 and blue collar with a stay at home wife with a total comp of 75K is competing against 200K 30 year old newlyweds. When their is a pool of young first time buyer newly wed college educated couples with 200K in salaries it drives up home prices. When I sold a small starter home in 2004 for 550K, the pool of purchasers were the 200K newlweds and asian imigrants. The traditional blue collar couples or even under 34 professional with a stay at home spouse was shut out of the market. Even though homes are down a bit they are not close to 2001 prices which was the last time the blue collar families could swing a home and not put an anchor of debt around their neck. The home I sold in 2004 for 550k was worth 280K in 1998 and if balooned to around 650K in the spring of 2006. The HS educated couple who paid 280K for the house next door to my mothers old house refinanced has a low downpayment and is sitting on 350K equity. The 2004 - 2007 blue collar buyers are close to hanging themselves.
#9 - tbw,
Additional information on that stem cell firm.
Those 12 employees will be executive/management employees, not researchers. Disappointing for those who hoped to see NJ turn into a stem cell research center.
#14recrybaby: We are going to bring you and you ilk to your knees.
Essex 35
The rising profit of the oil companies and the grain suppliers is a prime sign that there are core supply/demand issues. Look at beluga caviar. The species of fish is almost extinct ( i.e highly restricted supply and no new resource for this particular type of caviar)but the companies that supply caviar make a load of money on this product.
———–
of course there is an easy solution. the world population is about 6.6 billion. liquidate about 20%+ of the population and our resource issues will be much more manageable.
a small meteorite strike, global pandemic, WWIII,there are plenty of choices.
[sarcasm half off]
ISM & Construction Spending due out in 10
#32 Rich: Thank You.
14 recoward101
That’s your funniest post yet.
We should all give our tax dollars directly to YOU!!!
BWAHAHAHAHAHA!!!!
Rich,
Thanks for the email on historic data, I’ve got a draft reply I’ve been working on over the past few days.
To sum it up, I’m not sure if we can look at long term historical data without contemplating the possible change in MLS market share throughout the years. Short-term, I don’t think it is an issue, but going back 10 years, I’ve got to wonder.
Can someone define “cheapskates and housing terrorists” for me? Is that just synonymous with saying, “fiscally responsible renter/future home owner”?
50]
Flat wages and rent increase to match inflation. Nice!!! Consumer spending should take a massive hit.
I’m all for 10% across the board rent increase!
Wow, flashbacks of 2000…
From MarketWatch:
JDSU shares fall 13.4% in early trading
Grim,
I just sent you a pdf file that contains a geographic breakdown of office employment.
It fits with what I’ve been saying - despite nonstop headlines of so-called Wall Street job losses, New York and New Jersey are holding up relatively well. The real pain is being felt in Detroit, Orange County, and other housing crash markets.
The mainstream media and its consumers are missing the story.
Everything you want to know about the bank crisis
Iain Macwhirter
As the financial crisis enters what the governor of the Bank of England has called a “new and dangerous phase” Iain Macwhirter has been looking at the big questions
How bad is it?
Do the banks know what they are doing?
How could the banks be so stupid?
Didn’t the regulators see this coming?
Does this affect my savings?
Is anywhere safe?
What else can individuals do?
What is the government doing?
Why is the government bailing out the banks?
If we finance the banks, can’t we tell them what to do?
What about the US Federal Reserve?
What does it mean for the global economy?
What is to be done? …
Grim, please post the pdf file when you get a chance. Thanks.
Rich or Grim,
Could you possibly give me an address / history for:
MLS Reference number: 2816914?
Thanks
32 Rich
Interesting
If accurate, the portend is for a further downward curve, since the under contract number is the worst since 1990, whereas the sold number is the worst since 1995.
pre,
http://njrereport.com/files/Office_jobs.pdf
“pretorius Says:
January 17th, 2008 at 11:18 am
I believe we’re in a mid-cycle slowdown, not a recession. I doubt the NBER will find a recession in 2008.”
Am I the only one here who said we would avoid recession?
It is too early to conclude for certain that I’m right, and I agree we’re in a major slowdown, but I’m sticking with my contrarian call.
GDP is negative in recessions, and it has been positve during the last 2 quarters.
“GDP is negative in recessions, and it has been positve during the last 2 quarters.”
If you trust the numbers?
Doyle,
203 W. Passaic
No additional history on NJMLS. Tax records show a transfer in 2006 ($1).
“Can someone define “cheapskates and housing terrorists” for me?”
[64]
Akin to punches landing on your head constantly and being knocked to your knees continually. Subsequently, you are transformed from being a boxer to becoming the Bayonne Bleeder.
43 pretorius
“Southern states routinely produce 8- and 9-figure incentive packages to attract capital investment and manufacturing jobs into their states.”
And well they should, since southern states get the disproportionate amount of federal spending, and so should have scads of extra cash to spread around.
48 cindy
“If you’re taking steroids and do really well, but three years later you get cancer, was it worth it?”
You know what you do then, don’t you??
More steroids, of course!
njbear,
I’m all for 10% across the board rent increase!
Me too. I love a good rent increase.
WASHINGTON (MarketWatch) — Manufacturing activity contracted again in April for the third straight month, the Institute for Supply Management reported Thursday. The ISM index was steady at 48.6% in April, the same as in March. Economists were looking for a decline to 48.0%. Readings under 50% indicate more firms are contracting than expanding. The new-orders index was steady at 46.5% in April. The employment index fell to 45.4% in April from 49.2% in March. The prices index rose to 84.5% in April from 83.5% in March
50 pretorius
I’ve seen the same anecdotally. Then again, I believe it’s evidence that Jerseyites no longer want to buy. See, e.g., me.
Stu,
I understand that the stats have wrinkles. The so-called core inflation stat, for instance, is becoming increasingly irrelevant.
A lot of people here have rubbished the GDP figures, just like they ignore OFHEO and NAR data on New Jersey home prices.
If we dismiss data that does not conform to our thesis, then our conclusions will be biased, and potentially dangerously wrong.
“GDP is negative in recessions, and it has been positve during the last 2 quarters.”
If you trust the numbers?
If you believe in those numbers I have a bridge for sale. It conects Brooklyn and Manhattan. I have just reduced the asking price by 5 thousand. Hurry it won’t last. bring your checkbooks.
64 Doughboy
“cheapskates and housing terrorists”
It’s a very specific term. It doesn’t merely define someone who isn’t buying generally. Rather, it specifically defines someone who isn’t buying from recrybaby101.
BC,
Terrible numbers across the board. 84.5% of firms reporting higher prices, what containment?
Oh sorry, I forgot to turn the spin-o-matic on. 15.5% of firms didn’t report higher prices, hurrah!
Could it be that yesterdays 25 BP cut is the straw that broke the camels back?
http://www.bloomberg.com/apps/news?pid=20601104&sid=aXIrK5MXYrEw&refer=mideast
Can someone say bye bye USD? I just bought some more GLD.
Dear Members of Realogy, Weichert and Century 21,
The preliminary NJMLS sales numbers in Bergen County for April appear to be as weak as we’ve seen in over a decade. Members of your organization have stated that real estate never goes down in Bergen County and that population in the county is increasing 10% per year.
In your professional opinion, can you explain these numbers?
67 pretorius
I see NY and NJ are currently in decline, however.
What do you mean limits. Americans don’t believe in limits, especially when it come to credit cards.
http://www.chicagotribune.com/business/chi-wed-brf3-credit-card-rules-apr30,0,3193156.story
pretorius Says:
May 1st, 2008 at 10:01 am
“pretorius Says:
January 17th, 2008 at 11:18 am
I believe we’re in a mid-cycle slowdown, not a recession. I doubt the NBER will find a recession in 2008.”
Am I the only one here who said we would avoid recession?
It is too early to conclude for certain that I’m right, and I agree we’re in a major slowdown, but I’m sticking with my contrarian call.
GDP is negative in recessions, and it has been positve during the last 2 quarters.
pret: ultimately there is nothing really conclusive to base your opinion on the trough being here….not that I am saying your view is without merit….however, looking at everything in context, logic seems to dictate that 2008 & 2009 are going to be really bad around here….
Didn’t I say several months ago that mid-May would be a great time to try a snag a table at one of the top restaurants in NYC during the week?…..go forth and help the economy…..
make money Says:
May 1st, 2008 at 10:13 am
Could it be that yesterdays 25 BP cut is the straw that broke the camels back?
Can someone say bye bye USD? I just bought some more GLD.
make: you could conclude the reverse you know……
82 pretorius
“If we dismiss data that does not conform to our thesis, then our conclusions will be biased, and potentially dangerously wrong.”
Certainly. However, your prediction was as to NBER finding a recession in ‘08. Let’s wait until after ‘08 is over before we conclude whether you’re the only one who was right, or the only one who was wrong.
Chifi, do you think NBER finds a recession in 2008?
2008 and 2009 will feel bad around here - we’re in a major economic slowdown.
Thanks Grim.
Pret,
I stopped trusting the numbers when ‘W’ got elected. Not just numbers that support my theories, but all numbers put out by his administration.
Inflation is realistically well above 10%. One needs not go further than the supermarket, the gas station, the Home Depot, the jewelry store or the landlord for evidence. If you choose to believe the FED numbers, it is well below 4%.
The sad part about a recessionary call is that it really doesn’t mean anything. Would the media fret about a difference in 1% or 1.5% GDP growth? If we don’t go negative GDP and rather it grows .00000001% for the next ten years, then we wouldn’t be experiencing a recession. Of course, 10% inflation and a wage that increases by 3% or less annually over the same time period would personally hurt me a lot more than a headline that reads we are in a recession.
See my point?
And you, like Bi, lack patience. Sure things are moving slowly. They usually do. We live in a society where instant gratification is valued tremendously. Give it some time. The krap didn’t hit the fan until last August. We are talking 8 months ago at best. With the help of the FED, the great unwind has been slowed. The FED is almost out of bullets. Once the chamber is empty, it will be interesting to see how the market reacts.
GDP is negative in recessions, and it has been positve during the last 2 quarters.
Is this a reference to the NBER recession dating procedure?
From NBER:
http://www.nber.org/cycles.html
The NBER does not define a recession in terms of two consecutive quarters of decline in real GDP. Rather, a recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. For more information, see the latest announcement on how the NBER’s Business Cycle Dating Committee chooses turning points in the Economy and its latest memo, dated 07/17/03.
95 stu
what you said.
SG
I guess I find it amusing that blue staters actually sit around and whine about the federal government at all, and demand it keep growing and stealing from the productive to give to the unproductive. At the same time, continue to elect at the state and local level a group of thieving, corrupt, incompetents that have far more power over their individual lives and economic well being that the anyone in the federal government ever could.
Actually what I find most amusing, is that people actually look to government at all to solve their “problems”. You have the gall to complain about the American consumer and his or her lust for material goods bought on credit, but you are advocating the same nonsense - government hand outs aka “universal” health care, money for college, blah, blah, blah. Take form soemebody else and give to me!!! Execept your dependency is on the government, or some faux politcal party or persona who you actually think is going to come along and make your life better. Get a clue, if Hilary or Barak get elected, the economic situation in this country is going to get worse not better. We’ve see what happens when you have single party rule in Washington, just as we we’ve witnessed the even more disasterous single party rule in the state of NJ, or in your local towns. The problems in America will only cease when people realize that government is not the answer to their problems, it almost always makes them worse.What we need is 8 years of utter gridlock in Washington, and in NJ, not more big government nannyism and redistribution for pet projects.
When the NBER declares a recession, it’s probably a good bet that we are in the early stages of a recovery. History indicates this. Better yet, go ask a home builder, a lender, high end retail, boat manufacturers, a lumber yard, etc.. Our BS #’s, I mean BLS #’s can’t even mask this.
Pre 74
look here
http://www.shadowstats.com/alternate_data
GDP has been negative for over 1 year
JBJB:
The Clinton years were completely unbearable. I suffered richly.
One guess please. You are part of the +200K per year crowd. Yes?
96 Grim,
Good catch!
Grim, I understand the NBER’s methodology and the incorrect convention wisdom that recession = 2 quarters of negative real GDP.
But when this happens…
“a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”
…it usually means real GDP is negative too.
The strongest component of yesterday’s GDP # was inventory accumulation, +0.8%. Take this away and you get -0.2% GDP.
Thanks Kettle1.
Why don’t you mention all of the offices that collect economic data that have been closed by the current administration, under the auspices of budget restraints. The same administration that has grown our debt more than twice as fast as any administration prior.
Yup, I’d trust the musings of an Alzheimer’s victim before trusting a word that comes out of DC. Senile statements are not made with malicious intent.
From MarketWatch:
Construction outlays fall 1.1% in March
Outlays for construction projects dropped 1.1% in March, led by the biggest drop in residential construction spending in 26 years, the Commerce Department reported Thursday.
The percentage decline was worse than the 0.7% expected by economists, but the level was higher than expected following a large upward revision to February’s outlays, which now show a 0.4% gain rather than a 0.3% decline.
Total construction spending is down 3.4% in the past year, as an extremely weak residential sector is offset to some extent by robust spending for nonresidential structures.
Spending on private-sector residential projects fell 4.6% in March, the biggest decline since 1981. Spending on residential proejcts is down 19.9% in the past year.
Spending on private, nonresidential projects rose 1.9% in March, led by communications and lodging projects. Private non-residential spending is up 15.4% in the past year.
The non-residential sector has slowed, however. In the first quarter, investment in business structures fell at a 1.6% annual rate. Commercial real-estate typically lags residential real-estate.
105 stu
to be fair, those offices were needed for political purposes. Just as, for example, Lurita Doan.
Lurita Doan trivia question,
What is her undergrad and masters degree in that would qualify her for her prestigious appointment to head the GSA?
… future mortgage broker, or, Fed Reserve Chairman?
“…it’s fun to do bad things”
http://youtube.com/watch?v=iprUJeDEXUo
“What is her undergrad and masters degree in that would qualify her for her prestigious appointment to head the GSA?”
I believe she majored in Arabian horses, no?
Or am I confusing her with the head of a different agency….
Grim (63),
I was thinking the same thing as I was updating my tracking sheet for May.
What is the history of the MLS in this area? How many were there? Did they merge and if so, when?
I’ve also been wondering when the “condo” craze first started in this area. Mid-70’s or early 80’s?
There are many varibles that can skew the numbers. But I think I’ll split the difference and go with the last 10 years of data.
GDP
http://www.quickmba.com/econ/macro/gdp/
The head of NBER seems to think we’re in recession, even if NBER hasn’t officially called it yet:
http://news.yahoo.com/s/nm/20080407/bs_nm/usa_economy_feldstein_dc
Martin Feldstein, who leads the group that is considered the arbiter of U.S. recessions, said on Monday that he personally believes the economy has been sliding into a recession since December or January.
21 copper..Conte’s in Princeton…but don’t let the town fool you. It is a mom and pop, been around for ever, pizza only, casual place. no high end.
make: you could conclude the reverse you know……
No Sir. Propaganda of strong dollar policy in conjuction with foreign central banks is nothing but rhetoric. There is no action.
Market will prevail. Central Banks are liek little nagging mosquito’s. Thy’re just annoying. According to my man BC Bob.
clot:
aren’t you a HOLX fan?
From Forbes:
How Low Will Real Estate Go?
Though the national real estate market remains bleak–in some neighborhoods vacant homes outnumber those that are occupied and sellers are being forced to lower asking prices in a bid to lure bargain hunters–it’s assumed that when housing dips to a point where buyers think it represents a bargain, they’ll buy back in.
The problem is many of the markets that experienced steep 2007 price drops are still a long way from recovery.
That’s based on a Moody’s Economy.com report prepared for Forbes.com. It predicts that 2008 isn’t going to be any gentler than last year on slumping markets like Los Angeles, Sacramento, Calif., Las Vegas and Tampa, Fla., where market weakness is expected to cause 10% to 25% drops over the next year.
…
Price drops result from a convergence of factors including overbuilding and speculating and rapid price increases.
But large-scale job loss has the most potent effect, note Eric Belsky and Daniel McCue, economists at the Harvard Joint Center for Housing Studies. Markets can overheat, overexpand and digest flippers and overexuberant builders, but housing prices are most likely to fall when people lose their paychecks.
Belsky and McCue studied housing downturns from 1980 to 2004 and discovered that the most likely cause of housing price declines were spikes in unemployment. Consider the industrial cities of Cleveland and Detroit, which have lost jobs steadily since 2000 and now post unemployment rates of 6% and 7.7%, respectively, well above the national average of 5.1%. Of the 10 cities on our list of cities experiencing the greatest price drops, they are the only two where prices are lower than in 2000.
…
“In a normal housing market, we have ratios that you qualify for a certain amount of house at your income level,” says Anthony Sanders, a professor of finance at Arizona State University. “Since banks have tightened credit, we’re starting to revert back to those lending standards, and prices are going back to reflecting a ratio of income and median house value.”
…
Bottom line: “The continued decline,” says Sanders, “is going to be very problematic for homeowners–but also for secondary investors.”
make: you could conclude the reverse you know……
how so? any shift away from the petro dollar will force central banks around the world to dump US dollar reserves and buy more of what ever the new petrocurrency is. A skydiving dollar only exacerbates the problem. If you think inflation is bad now, wait and see what happens if even 20% of the petro dollar trade value is replaced with another currency.
make money Says:
May 1st, 2008 at 11:03 am
make: you could conclude the reverse you know……
No Sir. Propaganda of strong dollar policy in conjuction with foreign central banks is nothing but rhetoric. There is no action.
Market will prevail. Central Banks are liek little nagging mosquito’s. Thy’re just annoying. According to my man BC Bob.
make: not my point…don’t you think that actors may have built such expectations into current pricing levels….I’m not saying that they certainly have, but rational expectations theory would such they would…..
such = suggest
I think, JBJB, that most people are tired of government screwing things up…they know that the gov cannot solve their problems, but they are sick of the gov creating more troubles than it is worth. I for one wish to not hear the name Bush, Clinton, GOP, or liberal….again.
To be clear….if you believe in mean-reversion you cannot simply apply it arbitrarily, or you succumb to the pret-accused bias….
ChiFi,
I know that i am not in your leauge in the financial knowledge realm, but consider the following.
If the US dollar and or market take a serious nose dive then the world as a whole is going to see serious global recession as they would have lost their largest consumer.
If the saudis are talking about dumping the dollar ( at least partially) then would you not price the dollar lower due to the risk? but if you put to much downward pressure on the dollar you collapse the already weakened american economy and financial system. so the question is how much downward pressure is to much? And can central banks afford ( or are willing to) hold dollar reserves that they have little use for while those same reserves continue to depreciate at a substantial rate??
My point is that in my economic laymens opinion global banks are locked into the US dollar at the moment. the global financial system is so connected that if the global banks cause any serious downward move of the dollar then they themselves will suffer for it and as we have seen it could be that some banks would suffer more then they would have ever expected due to leverage.
Pretard,
My landlord and I just renewed our lease in Hoboken. No rent increase. Sorry champ.
Essex Says:
May 1st, 2008 at 11:12 am
I think, JBJB, that most people are tired of government screwing things up…they know that the gov cannot solve their problems, but they are sick of the gov creating more troubles than it is worth. I for one wish to not hear the name Bush, Clinton, GOP, or liberal….again.
SX: Honestly, I am guessing that from an economic standpoint, there are two items of note:
(1) the President-elect for 2008 will be one-term, because this country is going to have a bad ride, and the President will take the blame.
(2) Clinton is probably best equipped to run the economy….at heart, she is a capitalist and too many experienced people around…..I would fear her though in 2013-2016 if she was re-elected, because if she didn’t have to answer to the public she would kill us all….
ChiFi
“at heart, she is a capitalist”
With all due respect, what is capitalistic about windfall taxes on profits earned by public companies an threating to end trade deals?
Hehehe,
There are plenty of ways to game the system as a renter. I did it when I rented in Hoboken.
Go with mom & pop landlords. Their cash flow can go negative with just a few vacancies, so they’re willing to make concessions to keep good renters from leaving.
Sophisticated landlords like AvalonBay have airline-style yield management systems that tell them when to be aggressive on rents. They’re successfully raising rents in New Jersey can tolerate turnover and vacancies.
True capitalists are few and far between in the political ranks these days.
They’re all for giving away free candy. The only dispute is over to whom the candy is distributed.
“airline-style yield management systems”
Pardon my ignorance, pret, but what is one of those?
I got off with a $25/month rent increase… meh.
With the state of the state, well and the general economy and political landscape; reading the book “Term Limits” by vince flynn really is amusing.
125 chi
On item 1, couldn’t agree more.
We could elect Jeebus, or Moses, or Mother Theresa, or Babe Ruth, and s/he wouldn’t get past the first term.
Apres moi, le deluge!
Njpatient,
Yield management is buzzword for pricing system that squeezes every last $ out of the customers.
GDP is up because of inventory growth. Put any spin you want on it, it is not a good thing.
Pret:
Read this.
http://finance.yahoo.com/tech-ticker/article/14032/Economy-Grew-in-Q1-Only-If-You-Believe-in-Santa-Claus?tickers=
“The recession-deniers were out in force yesterday after the “better-than-expected!” GDP figures came out: See? The economy GREW in Q1! We aren’t in a recession! All that horrendous economic and housing data is just media hysteria!”
JBJB Says:
May 1st, 2008 at 11:25 am
ChiFi “at heart, she is a capitalist”
With all due respect, what is capitalistic about windfall taxes on profits earned by public companies an threating to end trade deals?
JBJB: pandering to get elected….patient - agreed
Stu,
I could turn out to be wrong. At least I’m willing to go on record with measurable contrarian calls.
Aaron [133],
Spot on.
Some get their jollies off reading the headline #. If they ever took the time to dissect the details they would probably place their head between their knees.
Pret says: “I could turn out to be wrong. At least I’m willing to go on record with measurable contrarian calls.”
Sure. You have SO MUCH to lose.
Seriously though, if you are going to make contrary calls a part of your standard repertoire, then you must learn to be more willing to listen to refuting evidence.
Yeah GDP positive was complete bs. Like BC said it’s all inventory increases. They better hope that stimulus check game works or they are really f’d. Given the timing they are doing eveything they can to prop up third quarter GDP adn avoid official recession claims prior to the election. You see all that money going into tech now makes me wonder how many Iphones “the experts” think Joe Sixpack is going to buy. Given the fact the “improvement” in consumer spending is directly correllated to higher gas and food prices I have a hard time seeing Annie Mae and Jim Bob buying a new computer and foregoing feeding the youngins or filling the getter up with gas, but then again don’t bet against American stupidity, spend today until you can’t borrow tomorrow.
From the Star Ledger:
Home Depot to close 2 New Jersey stores
The Home Depot Inc. today announced that it will shutter 15 of its locations nationwide, including stores in East Brunswick and Saddle Brook.
…
The East Brunswick and Saddle Brook stores will be closed Friday as the staff prepares to sell off remaining merchandise. They will reopen Saturday and continue operating until the stock is gone, said Sheriee Bowman, a spokeswoman for the company.
“We are anticipating about 7 weeks,” Bowman said.
Stu,
By visiting this site I get plenty of refuting evidence. If I wanted to avoid it, then I wouldn’t come here.
IMO, Mrs. Clinton seems to favor a sledge hammer to solve any problem faced by the electorate. In most cases this sledge hammer turns out to be tax payer money.
Will Mrs. Clinton cry again if she doesn’t get her way on the hill?
Stu Says:
May 1st, 2008 at 10:41 am
“Yup, I’d trust the musings of an Alzheimer’s victim before trusting a word that comes out of DC. Senile statements are not made with malicious intent.”
Hey, with Reagan you got both.
“airline-style yield management systems”
Because the airlines are all so stunningly successful, never lose a dime, never require huge capital infusions from the taxpayers.
Oooops.
how long has it been since airlines actually made a profit, not counting federal subsidies or other tax payer assistance?
132 pretorius
I know - I was wondering about the “airline” portion of the phrase. That’s not an industry that I associate with profit.
I see ’soosh and kettle knew where I was going with that - y’all know me too well.
Lisoosh,
What is your point? Are you attempting to insult me?
It is clear that AvalonBay’s yield management system works, which is bad news for thousands of New Jersey renters.
149 pretorius
“What is your point? Are you attempting to insult me?”
Lisoosh is pretty polite as a general rule - what part of what she said was insulting to you? Hehehe dished out far worse a few comments ago.
I’m confused - you’re not usually so thin skinned (and I’ve tried to crack your facade quite often, so I should know).
I was
I rememeber when this was first announced, it had this board in a tizzy for weeks. It was going to reignite the boom, housing was hot again!
From the NY Times:
The Road to a Jumbo Mortgage Was Supposed to Get Easier
In early February, Congress gave beleaguered mortgage borrowers a rare cause for celebration. As part of the economic stimulus package, it passed rules intended to make it easier and less expensive for people to take out hefty loans in the nation’s costliest housing markets.
Economists and legislators said that helping tens of thousands of borrowers take out billions of dollars in new loans could stanch the bleeding in the housing market, spur spending and reduce the pain of a likely recession.
Instead, the effort to make it easier to get jumbo mortgages — loans over $417,000 — has yielded frustration and disillusionment.
Since the rules took effect April 1, many prospective borrowers and their mortgage brokers say the new loans are either not available or the rates are far higher than they expected. Relief, they say, has been replaced by grief.
The program “is so much of a failure that it’s really unbelievable,” said Daniel M. Shlufman, president of the FCMC Mortgage Corporation in Clifton, N.J. Mr. Shlufman likened Congress’s effort to “coming up with a vaccine to a terrible disease, and then not giving it to people, or making it too expensive.”
We’ve see what happens when you have single party rule in Washington, just as we we’ve witnessed the even more disasterous single party rule in the state of NJ, or in your local towns.
That is the only reason why I would support McCain, so no one party controls both Legislative and Executive branch. In fact, I think last Bush term is more effective as we have no single party controlling all things and govt just cant make things worse due to gridlocks. The first term was the disaster.
Here’s another thing to talk about the GDP number. When the gov’t calculates thi snumber they account for the inflation to be at 2.6% level.
Since we all know that inflation is at least twice that there gows your growth!!!
All I know know is that in 2004-2006 you did not see ads that stated lunch is provided at an open house let alone the name of the snooty caterer!! The other thing I noticed is a few of the guys at the train who have good jobs over the last year let their BMW/Mercedes/Volvo leases expire and one by one the are “god forbid” buying inexpensive new cars for cash Focus, Malibu, Edge to drive to train station. Job market shakey they don’t want to re-lock into loan or leases. I wonder if I can call that a forward looking indicator! Ford did annouce Focus sales are way up, to me that is not a good sign, that is just shakey job market and high gas prices causing people to choose on of the cheapest made cars with good milage that still gets a good consumer report rating.
Open House Info: Date: 05/01 Time: 12Pm-1:30Pm
Lunch Provided By Eric Stam. All Welcome!
Bottom line loans that are over 417K start at 3K a month, which means only a person making over 10K a month should even apply. You all have told me again and again statistically their ain’t that many people making over 120K a year on a single income in NJ, counting dual incomes towards a mortgage is risky. So what, 95% of population can’t afford a jumbo anyhow so big deal.
Somethings come out of Archive of old news,
Why gas in the U.S. is so cheap
Despite daily headlines bemoaning record gas prices, the U.S. is actually one of the cheaper places to fill up in the world.
The difference is staggering. As of late March, U.S. gas prices averaged $3.45 a gallon. That compares to over $8 a gallon across much of Europe, $12.03 in Aruba and $18.42 in Sierra Leone.
Re BMW
Consumption Crisis Spreading
http://www.minyanville.com/articles/Credit-subprime-SBUX-hog-crisis-BMW/index/a/16942
Layoffs jump to 19-month high in April
WASHINGTON (MarketWatch) — Led by cost-conscious financial companies, major U.S. corporations announced 90,015 job reductions in April, up 68% from March and the most since September 2006, according to a monthly tally released Thursday by outplacement firm Challenger Gray & Christmas.
Financial companies announced 23,106 layoffs in April, including major reductions by Merrill Lynch and Citigroup. April marked the largest cuts in the sector since last September.
Thank God, proximity to New York will save NJ real estate !!!
152 grim
I believe BC and clot (among others) predicted exactly this: “the new loans are either not available or the rates are far higher than they expected.”
153 SG
The first term and the first half of the second term, that is.
Corzine actually sounding smart!!!
http://www.bloomberg.com/apps/news?pid=20601109&sid=aO1g6B5DJ_7k&refer=home
Here’s an interesting post on real estate, the nature of modern development, and effects on transit/access. Anyone whose ever been to Tyson’s Corner, VA (suburban DC) will recognize what’s being talke about immediately.
http://matthewyglesias.theatlantic.com/archives/2008/05/if_you_build_it.php
Atrios adds:
Those who built - and bought in - newer suburbs with limited access and no through traffic thought it was a feature, not a bug.
Aside from separating people from retail and other commercial activity, it increases traffic problems by removing spillover alternate routes. The model means you have to get on the freeway or other major artery to get anywhere, and if the freeway is congested or there’s an accident there aren’t any other options.
But as I said this has long been sold by developers as a feature, as it reduces through traffic and minimizes the presence of strangers who are going to steal your children.
Separate response from Atrios
It is clear that AvalonBay’s yield management system works, which is bad news for thousands of New Jersey renters.
I’d rather have my rent go up $50-$100 than be losing thousands of dollars in “equity”/month.
BTW, the condo in my building is still not rented out yet, even though they have been advertising it twice/day now for the last month. On a related note, I’m seeing more and more For Rent signs popping up in Hoboken.
A lot of people here have rubbished the GDP figures, just like they ignore OFHEO and NAR data on New Jersey home prices.
If we dismiss data that does not conform to our thesis, then our conclusions will be biased, and potentially dangerously wrong.
What about statistics (OFHEO) that ignore the entire top half of the market? IMO, OFHEO is far more flawed than CS.
“Six months have passed since the Fed first ramped-up its MBS repo activity, and the details of the MBS market remain as murky as ever. Still, very few private buyers will finance MBS purchases. Still, the Fed fills the role of “buyer of last resort.” In fact, as the second chart illustrates, the Fed has been increasing its MBS purchases. What a strange sight to see in a “recovering” credit market!”
“This odd circumstance raises an obvious and troubling question: If the credit markets are truly recovering, why is the Fed increasing its purchases of questionable mortgage assets from financial institutions?”
http://www.agorafinancial.com/afrude/
152 & 160,
While speaking with a mortgage broker from Coldwell I was informed of the following:
Conforming: Below $417,000 5.9%
Conforming Plus: Above $417,000 6.3%
Jumbo: ~$500,000 7%
Hobokenite,
I agree that OFHEO isn’t perfect, and I believe that CS is a great index for markets like Las Vegas and Dallas.
However, they both use similar methodologies, and OFHEO has a New Jersey-specific index which makes it better for measuring home price changes here than CS, whose New York index covers parts of 4 states.
Rich in NNJ [166],
Impossible. I have realtors emailing me telling me that:
1) Rates are at historic lows
2) Things are heating up
3) There’s a lot of activity
4) The party in North and West Caldwell never ended
Isn’t that correct, members from Realogy?
“pretorius Says:
May 1st, 2008 at 12:09 pm
Lisoosh,
What is your point? Are you attempting to insult me?
It is clear that AvalonBay’s yield management system works, which is bad news for thousands of New Jersey renters.”
Pret - unless you personally set up AvalonBay’s yield management system and purchased it from an airline, I fail to see how I am “attempting to insult” you.
Consider it “taking a contrarian position”.
That said while anybody who flies is unfortunately well aware of airlines attempts to squeeze every last $ out of their customers it is still true that while air travel continues to be popular (because of speed) the airlines run on abysmal business models. They invariable go bancrupt or require huge infusions of cash from the government. Air travel is heavily subsidized. In addition, the squeezing has meant little to no customer loyalty.
Housing has a completely different model and turnaround time. If an airline overprices tickets, the prices can be dropped with a keystroke and seats sold. If rents overprice, the affects won’t be seen immediately. People have year long leases. They hate to move and so can be pushed to pay more in the short term. However the same tenants might find they move purchase plans up a year or two, or choose to move out of the area if prices become more expensive than it is worth. They might stop recommending their freinds move in.
There is a very fine line when squeezing customers for $. They tend to know it and only put up with so much, especially if there are alternatives. And there are always alternatives.
I don’t know anything about AvalonBay. Have no idea where they are priced or what other factors would make them attractive to renters or what their competition is.
I’m not sure why you would wish for thousands of NJ renters to get “bad news” though.
However, they both use similar methodologies, and OFHEO has a New Jersey-specific index which makes it better for measuring home price changes here than CS, whose New York index covers parts of 4 states.
I’m wondering why you didn’t make the same criticism of the office jobs PDF you asked me to post?
Grim, what is your point?
“OFHEO has a New Jersey-specific index which makes it better for measuring home price changes here than CS, whose New York index covers parts of 4 states.”
OFHEO only calculates single family dwellings financed by conforming conventional mortages. It does not include attached, condos.
Why would anybody folow an index, in NNJ, that excludes non-conforming mortgages and condos?
Created by the same quant as our CPI #’s?
I just don’t understand how you could have a methodological issue with the geographic boundaries that Case Shiller uses, yet at the same time not have that same criticism of the data you are using to support your point. You seem guilty of the same behavior that you accuse others of.
Wow, What a prescription? This is by far the first article I have read that is candidly talking about the roles Banks, Fed and Govt played in Bubbles.
The only way people can protect themselves is to pay off all their debts, fast. People living in houses larger than they need should consider selling before prices fall. First-time buyers should not under any circumstances be encouraged into the market, even if they can find a mortgage. Avoid discretionary spending, such as those silly sandwiches we buy for lunch, because you will need the cash to pay for higher food prices. In most parts of the country it is a lot cheaper to rent. Joining a car club can save thousands
The government thought it could jump-start the mortgage market by giving a £50bn bung to the banks in an attempt to reignite the housing boom. It will regret it. It was irresponsible of the Bank of England to accept the banks’ dodgy mortgage bonds in exchange for billions in cast-iron Treasury bonds because the banks know that their mortgage bonds are largely worthless, otherwise they would have offloaded them by now themselves.
The banks know that house prices will fall sharply over the next two years and are withdrawing from the home lending business.
There is a disturbing overlap between the higher levels of government and the big banks because of the privatisation of aspects of the state through mechanisms such as the PFI/PPP. It is no accident that when Tony Blair left office he walked into the Wall Street bank J P Morgan for a reported salary of £2m for a part-time job.
Everyone thought that as long as house prices rose, Americans could keep spending, even as middle-class incomes stagnated in the 1990s. Now it has collapsed, Greenspan’s successor, Ben Bernanke, has tried to save the banking system by inflating another bubble. But cutting interest rates has not worked. The cost of borrowing has actually increased.
The free-market orthodoxies of the past 30 years have crashed and burned.
http://www.newstatesman.com/200805010022
Housing-aid bill clears House committee
http://www.marketwatch.com/news/story/housing-aid-bill-clears-house-committee/story.aspx?guid=%7BE561D27D%2D2CBA%2D4AD3%2DA88A%2D5418C16EE834%7D&dist=hplatest
>>
If it is legal, I’ll be more than happy to financially help whoever is running against Barney Frank.
167 pretorius
I prefer the NYC/Metro index to the NJ index precisely because all the RE bulls claim that the reason NJ RE is in good shape is proximity to NYC. I also prefer the NYC/Metro index because it matters to me; I live where I do so I can commute to NYC. So for both reasons I don’t really give a d*mn what’s happening in Cherry Hill.
Until folks who claim NJ RE isn’t falling stop resorting to “close to Manhattan” or “proximity to NYC” arguments, I’ll continue to take a greater interest in the comprehensive CS numbers for NYC/Metro and a lesser interest in OFHEO’s numbers for cheap housing in NJ.
If you want to ignore NYC/Metro pricing, then you’re probably better off dropping your usual point about Hoboken, Weehawken and parts of JC being different from the rest of Jersey because they’re close to Manhattan.
You know, for consistency’s sake.
“The only way people can protect themselves is to pay off all their debts, fast. ”
Other than if you’ve got fixed rate gov’t-backed student loans at a good rate, IMO. Pay those puppies off slowly.
Grim,
I don’t have a big problem with Shiller’s New York metro. It is a reliable benchmark for single family home prices in the area it covers, which stretches from eastern Pennsylvania thru western Connecticut. It just isn’t the best way to measure New Jersey home prices.
Regarding the jobs stuff I asked you to post - do you have a better yardstick for measuring what is happening to office jobs around here compared to other parts of the country?
158…BMW — yeah I will pay off mine and hold onto it longer now — but more interestingly IMHO
But whether it’s increased demand for public education, public healthcare, or public housing, I believe the market has completely underestimated the burden which will be placed on local, state and federal agencies to support consumers’ voluntary (such as education or transportation) or involuntary (healthcare, food and housing) migration to cheaper public alternatives. And with property and income tax revenues almost certain to decline further, we’re likely to see dramatic increases in government deficits
From across the pond.
Why the housing bubble finally burst
Reincestor101
I can recall you demanding rate cuts to support housing prices. Now you’re complaining about crazy fuel and food prices. Well, you got your rate cuts and a collapsing US$ is the consequence. What do you think happens when you devalue our currency
njpatient (176),
You took the words right out of my mouth so to speak.
Why is counting dual incomes toward a mortgage “risky”?
movinB,
Because if one of the two loses their job, is hurt/sick etc., you end up losing your house.
Pretorius
If the question is “what is a more important aspect of my house’s location, (1) that it is within commuting distance of Manhattan or (2) that it is in New Jersey)”, then I think you’re the first person I would turn to to make the argument that the answer is number 1.
I couldn’t begin to count the number of times you’ve posted about the difference between Detroit and NY or other comparisons to NYC/Manhattan. Have you forgotten the discussion we had about which zip codes have been defined as “declining markets” by mortgage originaters? That was the one that caused you to limit the definition of “close to Manhattan” to Hoboken, Weehawken and parts of JC. At that time, for example, you wanted only to talk about NJ to the extent it was close to Manhattan.
The only time you ever want to limit discussion to NJ and cut NYC out of the equation is when you find that the NYC/Metro pricing results from CS are inconvenient to your argument.
Let me as you: why not use NYC as a proxy? Are you arguing that RE pricing results in New Jersey are BETTER than in NYC?!? If that’s the case, then as a logical matter you must drop the argument that NJ is in good shape because of its proximity to NYC. If that’s not the case, then let’s look at the NYC/Metro numbers comfortable in the knowledge that NJ is worse.
For example, in a recession……
“Why is counting dual incomes toward a mortgage “risky”?”
Because your doubling the odds that, due to a job loss, you won’t be able to afford your mortgage.
But if you’re only counting on one income, isn’t that more risky? Then if that one income goes kaput, there’s absolutely *no* money coming in. Whereas with two incomes, at least there’s enough to scrape something together. I dunno, it still doesn’t make sense to me that two incomes would be more risky than one. I guess it depends on how much is being financed?
Deutsche Bank to Launch Leveraged, Inverse Commodities ETNs
#188 - There’s nothing risky about counting 2 incomes. It’s done regularly. You are correct, 1 income is just as risky.
The only way counting 2 incomes is risky is if one income is fictional. This was done in (apparently) a large number of stated income loans in order to qualify. In full-doc it’s fine.
patient [185],
Stop. You’re talking too much sense.
One other item, Merrill’s deep cuts yesterday are insignificant. After all, we’re talking about Hopewell, NJ.
“But if you’re only counting on one income, isn’t that more risky? ”
No.
In your example, you’ve already got two incomes. How is relying on only one of them (i.e., a lost job doesn’t matter) more risky than relying on both (i.e., a lost job DOES matter)?
One mortgage that one half of the couple can afford…that is key. Yet rare. To do that you need to buy something ‘affordable’ not too easy to do here in NNJ.
I think the assumption is that even with 2 incomes, it’s risky to “max out” your borrowing to get a house. You’re better off buying a house you can afford on one income, in case one of you loses their job.
I don’t think anyone is saying only one of you should work.
“One other item, Merrill’s deep cuts yesterday are insignificant. After all, we’re talking about Hopewell, NJ.”
Exactly, BC. Job cuts only count if they’re in Manhattan, right? But RE pricing results only count if they’re NOT in Manhattan….
One mortgage that one half of the couple can afford…that is key. Yet rare. To do that you need to buy something ‘affordable’ not too easy to do here in NNJ.
I think it only became rare in recent years. When the key to wealth was obviously to leverage up and buy as much real estate as possible, it obviously became just about impossible.
193 essex
Agree it’s not easy. Better, but definitely not easy.
194 hobokenite
Yes. I’m all for two incomes, but if you tie them both into your mortgage, you can run into trouble if one of you loses your job, or has to stay home to take care of kids, or any of a number of reasons you might lose an income. Why not have the same income but make sure your able to afford your mortgage by assuming that you have only the one (recognizing essex’s point).
Obviously, if it’s not feasible, then it’s not feasible. On the other hand, if you can’t really afford something, then you can’t really afford something.
Water - awful wet stuff, as the Duffers would say.
“I don’t think anyone is saying only one of you should work.”
I certainly wasn’t…..
#194
Ya I guess the key point is that you shouldn’t be depending on both incomes for maxing out the “affordability” of the mortgage.
What didn’t make sense to me is how if you’re relying on two incomes, it’s much less likely that BOTH could go kaput in a recession, and this two incomes is less risky.
But again, we’re back to how much each income plays into the amount being financed…
Rephrasing my hurried typing:
What didn’t make sense to me is: if you’re relying on two incomes, it seems to me to be much less likely that BOTH could go kaput in a recession, and thus two incomes should be LESS risky.
Etc etc - stuff about it all hanging on how much each income plays into mortgage amount.
Anyone who lived through the tech crash knows about displacement….and job security.
And yeah, it would be difficult, if not impossible, to be able to buy a house on one “middle class” income in NJ. For the next few years, anyway
That’s why housing tends to move moreso with employment. As jobs are lost prices decline as those that can no longer afford home payments start selling their home. The current housing bubble was financed with low rates and loose lending, not employment or income growth. Now that loose lending is paired back we’ve had some decline. When employment/income growth slows, which we are starting to see only recently than prices should decline further. The nail in the coffin and wild card will be inflation/interest rates. If they ever go up dramatically coupled with the other two factors. Watch out and duck for cover! Prices will drop precipitously.
Actually, inflation might slow down the drop in housing. If a house is overpriced by 20%, and inflation is 20%, then you just have to wait for a year for it to catch up.
NJpatient,
The name of this blog is the reason I talk about NJ real estate prices.
The reason I comment on New York employment is because New York is the most important employment center for New Jersey, even though it is on the other side of the state line. But I shouldn’t be accused of ignoring the New Jersey job situation - a few hours ago I asked grim to post data on this topic.
However, I own a home in New Jersey and work in New York, so I can’t deny that situation influences how I think about things.
Hobokenite,
I don’t think that’s right. Fed defined inflation only takes into account rent equivalent, not actual housing prices.
duck and cover!
http://video.google.com/videoplay?docid=-1528313029232126903
200 movin
“if you’re relying on two incomes, it seems to me to be much less likely that BOTH could go kaput in a recession, and thus two incomes should be LESS risky.’
If you’re relying on BOTH, then the loss of only ONE gets you in hot water.
If you’re relying on only ONE, then it takes the loss of BOTH to get you in hot water.
Hence, relying on both is more risky.
What is this “middleclass” that people keep speaking of? i thought you were either wealthy and intelligent or just a poor slob working a job.
205 pretorius
“The name of this blog is the reason I talk about NJ real estate prices. ”
My point wasn’t that you talk about NJ real estate prices and shouldn’t. My point is that most of the time you don’t talk about NJ real estate prices, but rather talk about “close to Manhattan” real estate prices. You only talk about NJ real estate prices to the exclusion of NYC when the topic of Case Schiller comes up.
When you have two incomes and you can pay your mortgage on one income it is much less risky, it is true a single income needed to pay a mortgage is just as risky as needed two to pay a mortgage.
When I bought my first home when my wife was working I bought much less than I could afford in case my wife left the work force, which she did the next year and has not been back since.
movinB Says:
May 1st, 2008 at 2:15 pm
Rephrasing my hurried typing:
What didn’t make sense to me is: if you’re relying on two incomes, it seems to me to be much less likely that BOTH could go kaput in a recession, and thus two incomes should be LESS risky.
Etc etc - stuff about it all hanging on how much each income plays into mortgage amount.
Nonsense kettle…..we are going third world here in the USA….the rise of the middle class….and fall…has been a result of the selling out of the infratructure and the exploitation of the poor in this and other nations. The rich are truly pillaging the world now. The rest of us can just watch and hope for the best, the mantra of the peasant…”things will always get better”
Paulson Says U.S. Credit-Market Crisis Is `Closer to the End’
http://www.bloomberg.com/apps/news?pid=20601109&sid=aZGKVAF.Xjeg&refer=home
“Citigroup Inc. Chief Executive Officer Vikram Pandit said April 22 that the credit-market contraction is abating, echoing remarks by Jamie Dimon, his counterpart at JPMorgan, who said April 16 that the credit-market freeze is more than half over. Richard Fuld, CEO of Lehman, Goldman CEO Lloyd Blankfein and Morgan Stanley CEO John Mack offered similar assessments. ”
Whew, thank god! That was a close one. Wair a minute didn’t most of those guys say their firms weren’t going to need additional capital and then they all needed additional capital?
“The reason I comment on New York employment is because New York is the most important employment center for New Jersey”
And this is why we know that, however bad the RE situation is in NYC/Metro, it’s worse in NJ.
#208
Ah I see - thanks. Point here being “rely.” I come here for an edjumucation!
Hobokenite Says:
May 1st, 2008 at 2:25 pm
Actually, inflation might slow down the drop in housing. If a house is overpriced by 20%, and inflation is 20%, then you just have to wait for a year for it to catch up.
Faulty statement: Houyse prices are tightly couples with jobs.If salaries are not raising and gasoline, medical and food are rasing 20%/year next year I have 10% less to spend on a house.
So inflation in consumer goods/services WITHOUT appropriate raise in salaies will actually lead to larger decrease in home prices.
In reality home buying and selling are very illiqud and not elastic, so what high home prices along with low salaries will do it do remove competitive workforce from NJ.
I need higher salary to have the same quality of life as someody who is 10 years older and was here in 1997. They bought their home for 119K, I can nto buy home for dheaper than 350K. So somebody older can take smaller salary effectivelly dispalcing me from job market here.
What do I do - rent for a year and try to increase my earnings.
If this fails - I look at the next logical step - Look for a job in the area where I can have comparable salary with a lot cheaper housing/other costs.
If you do not work on wall-street/big law/advertizement exec and most people are not - move.
At least this is my plan. One more year.
Was all 4,000 cut in Hopewell only? Or was a part of Jersey City cut as well?
“it is true a single income needed to pay a mortgage is just as risky as needed two to pay a mortgage. ”
True enough, John, but if you’ve only got one income then the question of whether it’s more risky to rely on two doesn’t really come up, does it?
Sorry if this has been brought up before, but is anyone lately moving up to say, NH, or is all of the movement from NJ southward (NC?) and westward (OR, TX)?
Well let me re-phrase buying on two incomes is ok if both you you are under 30, it is realistic to expect one of you to have enough raises and bonuse to equal your combined salary in 5-7 years. My problem is 40+ people buying on and needed two incomes. The odds are one of you is not getting big raises and bonuses as their is a work bias against older workers and as you get older the odds of one of you going on diablility, dying or geting laid off rises. Crazy enough I did see couples mid 40’s lock into 30 year mortgages where they need both incomes, well they better exercise and take their vitamins.
213 Hehehe
it’s the new mantra of the modern world of high finance:
“Didn’t this JUST HAPPEN???!?”
Njpatient
“You only talk about NJ real estate prices to the exclusion of NYC when the topic of Case Schiller comes up.”
I’m not excluding anything. Just the opposite - I’ve provided visibility into the different indices.
That is why I made this chart.
http://njrereport.com/images/pre_pricing.gif
220 john
I generally wasn’t disagreeing, and a two-income Patient household would rely on only one. The cash from the second income would be taken entirely in one dollar bills, which would all be put in the spare bedroom so that we could roll in the money, sleep in the money, have money fights, and show all our guests our giant room full of money.
Al, playing devils advocate here. I have a cousin who does not want to bother working in the city as he hates the hassel of the subway and trains, he also does not want to work on wall street due to hours and stress. Well you get a really good salary increase to work in city and then you get even a better raise to work in city and on wall street.
So he volunarily choose to work in a savings bank in the surburbes for 70K a year where he could be getting 120K a year in the city for the same exact job. Why is he entitled to a cheaper house and why should anyone feel bad for him that he lives in a small condo instead of a house? Kinda like the cop who works 3 days a week or the teacher with summers off. The on purpose choose to make less income for less work. Now it is a totally different case for someone in need or disadvantaged, but for college educated able bodied folks on purpose choosing a less paying job complaining they can’t afford a decent house is not the govts problem.
Recently, I asked my mother to pull up some numbers on my parents’ salary and what they paid for housing in the ’70s.
My folks were able to buy their first house in CNJ on just my father’s income (a very middle-class state agency job) in the early ’70s - it was financed at 3x his income.
Now, we can barely afford a starter house in NNJ on 3x our combined income, and DH and I both work very “middle-class” professional-type jobs.
A great time to buy?! My @$$
patient/hehe,
From my post, #165,
“It is an open secret among many hedge fund managers that the institutional holders of mortgage-backed securities and derivatives have not even come close to marking their assets to market. It is also an open secret that two critical pieces of knowledge remain utterly unknown: How big is the total MBS risk? Who’s holding the risk?”
“Until these questions receive credible (and quantifiable) answers, no one will provide financing to [asset-backed] entities, except the Fed.”
Two incomes are not as useful once wages stagnate and expenses rise to the levels where they are now.
BTW the credit crunch is over, yield spreads have narrowed, deals are getting done and FS stocks have stablized.
BTW that does not mean squat about your food and oil prices or the value of your home.
What it does mean is that the true americans who believed in bill bernakee were rewarded for buying munis, corps or beaten down MBS during the last three months and the nancy boys who hid in money markets are being punished with low rates and missed the 10% bounce off the March 10 lows.
Mukesh Ambani’s $2 billion home world’s most expensive: Forbes
1 May 2008, 2128 hrs IST,PTI
Print Save EMail Write to Editor
NEW YORK: The 27-storey skyscraper being built in Mumbai by Mukesh Ambani, the richest person in India, could be the world’s largest and costliest home with a price-tag nearing two billion dollar, according to Forbes magazine.
“When the Ambani residence is finished in January, completing a four-year process, it will be 550 feet high with 4,00,000 square feet of interior space,” Forbes said in a report on its website.
Earlier in March, Mukesh Ambani was ranked as the fifth richest person in the world with a net worth of 43 billion dollars by the Forbes magazine in its annual list of world’s wealthiest billionaires. While Lakshmi Mittal, who is an Indian citizen was ranked higher at fourth, he is a British resident. Among resident Indians, Mukesh was ranked at top.
“The only remotely comparable high-rise property currently on the market is the 70 million dollar triplex penthouse at the Pierre Hotel in New York, designed to resemble a French chateau, and climbing 525 feet in the air,” Forbes said in its report titled, “Inside The World’s First Billion-Dollar Home.”
Mukesh Ambani heads India’s most valuable firm Reliance Industries, an oil and petrochemicals giant.
222 pretorius
it’s a good chart and thanks for that. My point about things being worse in NJ than in NYC relates directly to that chart, however: Knowing that things are worse in NJ than in NYC/Metro, one must conclude that either the OFHEO numbers should be lower or the CS numbers should be higher (or both).
I have far more confidence in the CS numbers, since OFHEO deals only with homes costing $521K or less, which in the NYC region in the last several years is obviously a rather limited sample. OFHEO also doesn’t cover the homes that I would be looking at, so as to me specifically, it’s completely worthless.
Therefore, I look at the NYC/Metro number because (a) I think CS is more accurate, (b) without question CS is actually covering the houses I’d be looking at (both geographically and in terms of price, neither of which can be said of OFHEO) and (c) because in any event I can extrapolate that NJ generally will be in worse shape than NYC/metro.
John you are doing this again and again….
Please can I send you my resume so you can give me that 120K wall street job - I will email it through Grim… PhD Chemistry. Can not go get finance/law degree right now. Have a baby he need diapers and baby food.I need continuous stream of income.
Once again not everybody can work in Mahattan. Biochemists make medicine you are taking. Cab drivers drive you around. Baker make bread for you. Cleaners clean messes. Docors (MD’s) terat you when you are sick.
So i’d say for all thouse people who are thinking they are underpaid - move out. Once NJ does not have people to pick-up John’s $hit (sorry garbage) and he has to pay 100000K/month for garbage disposdal I will see what he would say.
The problem is that a lot of poor people in NJ for some bazar reason are afraid to move.
I am planning on looking for next job starting next spring (so I get fully vested into retirement benefits in my current company).
But I really do not see why would a family in which both people working “average” jobs (lets say between both working adults making under 110K) would want to stay in NJ.
Again - you can say all you want that only lazy would not go to Manhattan and get 120+k job - this in not the case.
I made 32K in 1992 and bought my first place from RTC for 28K, my limit was 1x income. 8K down with a 20K mortgage. Screw 3x.
Two incomes are much worse than one income when wages stagnate and expenses rise.
If the primary wage earner makes 160K and does not get a raise and his car, train ticket, subway ticket, work clothes bill rises that is bad.
If a two income family making 160K (80K each) does not get a raise and their child care costs rise, their two cars, two train tickets and two subway tickets and two sets of work clothes rises that is a blood bath.
226 BC
H*ll yeah, with bells and whistles.
Real Estate Agents Hinder Real Estate Recovery
But I have to say that agents–while protecting some homebuyers and sellers–are adding an incredible amount of extra work and effort to the real estate recovery. Their added fees are creating inflated home prices, keeping sellers and buyers from reaching deals.
Bottom line? From an agent? Sell by owner. Putting your house on the MLS is as easy as going to housepad.com. Unless you have some overly complicated situation, don’t waste your time or money with agents.
224 john
I don’t think that’s devil’s advocate at all. I’ve posted many times about my musician brother in the woods in Maine. He’s dirt poor, he chose that life because he prefers it, and not infrequently I envy him.
He doesn’t have my beautiful Little Patients, though, without which I would be in complete poverty.
228 john
“deals are getting done”
Watchoo talkin’ ’bout?
232 John -
Fortunately, many of us nowadays can telecommute part or most of the week. I think this will become more important for leveling the playing field into the future. If you don’t have to commute, it makes train towns that much less enticing.
John Says:
May 1st, 2008 at 2:55 pm
I made 32K in 1992 and bought my first place from RTC for 28K, my limit was 1x income. 8K down with a 20K mortgage. Screw 3x.
Basically you are saying that young people are screwed because they are…. well Young and where born too late??? Thats will encoraging.
Al, my friend called me last night she is looking for a IT internal auditor with 15 years experience and a CISA to manage one person and work a 40 hour workweek at a hedge fund in NYC. Willing to pay up to 300k, no takers yet. The CISA exam is like 500 bucks and takes around 2 months of full time studying to pass. All the time I see high paying jobs with low barriers of entry with no takers. What I do see are people who will see that job and say audit is boring I don’t want to write people up all day, who wants to study for two months etc. I see very little people applying themselves and studying to pass a test or be willing to do a job they don’t like. It is all me me me me. I would make pipe bombs for the JDL if the price was right.
Njpatient,
I generally agree…none of the indices fits everyone’s needs and all have flaws which makes them easy to argue about.
That is why I created my own database for repeat sales in my town.
But all of the home prices indices that I talk about - OFHEO, NAR, and S&P/C-S - are informative and useful to look at.
as far as money market: my stocks are down 4% YOY, my downpayment in CD’s are up 4.85%. .. After taxes - well that would be 3%.
Difference of 7%.
Al I am saying young people drove up the price of real estate and screwed them selves. The old folks selling their pos crap cape for 600K are selling it to young foolish folks. You did not see the old folks buyng that stuff.
The young folks are going to do great, you are not that young. The kids in college now in 5 or six years will be able to buy places at a good price.
231 Al
I understand where you’re coming from because there simply aren’t those jobs out there for everyone who is qualified, wants one, and is hard working and competent, and it’s offensive to imply that this is the case.
However, in defense of John (with whom I clash not infrequently), it is also not the case that everyone who works a $50K job wants a $120K job. Again, I give the example of my brother. He makes $40K/yr, and loves his life. If you offered him that $120K job in the City, he’d laugh.
john
“young people drove up the price of real estate”
That’s dumb, on the other hand.
242…if, john, there are decent jobs then….
“You did not see the old folks buyng that stuff. ”
Speak for yourself. I’m surrounded by entitled boomer bankers paying a mint for the McMansion and Lexus.
Al if you don’t have a house does it make sense to keep your money in taxable cds?
It seems everyone on this board was shorting stocks and longing commodities anyhow so they were making 4% a month for the last year.
the window to cash out on real estate was slim…and a lot of older folks….cashed out up here and then overpaid in Phoenix or South Carolina….think about it.
We should also include the First American LoanPerformance Home Price Index. First American LoanPerformance is the leader in mortgage data. In fact, the Fed Mortgage Map link that was posted here was based on LoanPerformance datasets.
http://www.loanperformance.com/products/hpi.aspx
Why bother? It’s the fastest and most comprehensive dataset on the market.
What is the catch? If you want the full dataset, you’ll pay for it. Too bad we can’t afford it.
Al, my friend called me last night she is looking for a IT internal auditor with 15 years experience and a CISA to manage one person and work a 40 hour workweek at a hedge fund in NYC. Willing to pay up to 300k, no takers yet.
Please do not avoid issue here:
How is this anecdotical, very specific example help me to get 120K job in wall-street???
I am not even asking for 300K. it should be easy - So should I send my resume to Grim??
Once again : NJ population 8,7millions. What is total wall-street emoployment? how many people form NJ work in NYC?
People in NJ are stupid, as they do not see that they can have a lot better quality of life elsewhere with their “ordinary, middle calss/lower middle class” jobs.
it seems that they are afraid to leave East Coast.
240 pret
Agreed as to most of that, except the NAR home price numbers. They hold almost no value, and I don’t even feel the need to make the argument from conflict of interest (though it’s obviously there), but comparing the median price of houses sold this week to the median price of houses sold last week is worthless methodology, whether on the way up or on the way down.
250 al
“How is this anecdotical, very specific example help me to get 120K job in wall-street???”
I don’t even believe that example.
Al/NJ Patent I feel like mixing the pot up today.
Here is my crazy topic of the day. Devout Hindus can’t eat honey cause honey is the food of the bees and eating their food causes the bees to die. Well I read today that in Canada there is such a rice shortage and rice is the main food source of pigs that the more rice that is eaten the more pigs will have to be slaughtered earlier than normal. So therefore everytime a hindu eats rice they are killing a canadian pig. What the heck will the hindus eat? Those guys live on rice. Sounds like a lot of bad karma coming our way.
re: yield management software adjusted the ask for rents daily, you are better off staying away from large companies that use this type of software since it may try and increase your rent 20% every year.
http://www.allbusiness.com/management/867364-1.html
what the heck do you do NJ patent maybe I will find you a job.
“What is the catch? If you want the full dataset, you’ll pay for it. Too bad we can’t afford it.”
Pretorius, you’re in the real estate business - do you subscribe to this?
Njpatient, the NAR data moves closely with the OFHEO and Shiller data, so it isn’t completely wrong. Plus, NAR discloses data on more markets than anybody else.
255 john
I do deal work - M&A, on the legal side, mostly representing execs in deals (or corporations firing execs). I don’t need a job.
No. I try to help out occasionally by sending grim PDFs of stuff I subscribe to that adds to discussions on this site, but I don’t get the loan performance data.
John Says:
May 1st, 2008 at 3:06 pm
Al if you don’t have a house does it make sense to keep your money in taxable cds?
It seems everyone on this board was shorting stocks and longing commodities anyhow so they were making 4% a month for the last year
Well I had cash in CD’s for downpayment in a house, but right now I am all but given up after this year’s house shoppping. NJ is too expensive for me and I should move.
Besides downpayment I have 401k/stocks acounts for retirement. But since my retirement is more than 30 years away thouse funds “do not exist” - I view them as “retirement tax” - once money gone from my paycheck/checking account they are gone. Once I have bigger cushion I will venture into more risky investments - later in life.
I do belive that 4.75% cd are basicall loosing money, but: nominal housing prices are not rasing either - since this money are for downpayment only I am not let’s say “losing money”.
At this point I have enough cash downpayments/reserves, and all I save i redirect into stocks. So I buy stocks every month - some month markets are up - I buy less, some they are down - in the end does not matter.
BC,
Its agreed it is all smoke and mirrors. The I-banks get the crap off their books temporarily for treasuries they can use as collateral to leverage up and pad their trading income. Make something close to insolvent suddenly “profitable”. Then you get the murderer’s row of bs artists to parade around tv telling everybody all is well. At what point does the market say bullshit and the stampede out begin?
re: (253) John - The farmers are feeding the livestock any surplus food they can get their hands on including candy bars.
A Wall Street Joournal article can out last year on this.
GARLAND, N.C. — When Alfred Smith’s hogs eat trail mix, they usually shun the Brazil nuts.
“Pigs can be picky eaters,” Mr. Smith says, scooping a handful of banana chips, yogurt-covered raisins, dried papaya and cashews from one of the 12 one-ton boxes in his shed. Generally, he says, “they like the sweet stuff.”
Mr. Smith is just happy his pigs aren’t eating him out of house and home. Growing demand for corn-based ethanol, a biofuel that has surged in popularity over the past year, has pushed up the price of corn, Mr. Smith’s main feed, to near-record levels. Because …
“Dwight Hess, a cattle feedlot operator in Marietta, Pa., is located in the heart of snack country, near Hershey and Herr Foods Inc., a maker of potato chips, pretzels and snack mixes. His cattle ration consists of about 17% “candy meal,” a blend of chocolate bars and large chunks of chocolate; 3% of what he calls “party mix,” a blend of popcorn, pretzels, potato chips and cheese curls; 8% corn gluten; and the remainder corn and barley he grows. He says the byproducts save him about 10% on feed costs. Still, it costs him about 65 cents to put a pound on a steer, up from 42 cents last year.”
Let’s all take a moment and ponder the idiom, “you are what you eat” while taking a bite of ham sandwich. Mmmm. Chocolate-flavored ham sandwich.
257 pret
“Njpatient, the NAR data moves closely with the OFHEO and Shiller data, so it isn’t completely wrong. Plus, NAR discloses data on more markets than anybody else.”
I wouldn’t say it moves closely. The flaw in the methodology is what causes the wild fluctiations you see in the NAR line that don’t show up in CS. Over the longer term it is useful for showing trends, but not for gauging what one should offer for a house in Bergen this year as opposed to last. Their inventory and sold numbers are very useful, obviously.
259 pret/249 grim
any idea how much access to that dataset costs? (I was too lazy to hunt around and figure it out, I admit…)
So instead of answerting be directly about that 120K position wich is anybody willing to take a job at wall street can easilly get, John talks about PIGS
I called yopu bluff and you folded.
262
I remember feeding the pigs practically anything back in the day - including butter wrappers.
255 john
“what the heck do you do NJ patent maybe I will find you a job.”
Gotta admit, that made my day. Get in touch if you ever need help with your severance package.
patient (267) - Laughing my boom boom off… thanks…
NJ patent you did not tell me what you do? I know of more jobs in the 150K to 350K range but I bet I could find one or two 120K jobs floating around if you like. I have a guranteed severance package in my contract otherwise I would use your services.
Al Says:
May 1st, 2008 at 3:21 pm
So instead of answering to me directly about that 120K position, wich is anybody willing to take a job at wall-street can easilly get, John talks about PIGS
I called your bluff John, and you folded.
I need Grim to enable auto-correct feature on his site.
[212]
Kettle,
Whaddya think? Should Essex be a partner in the rural farming/retreat/sanctuary land investment idea I floated last month?
And he would love my idea of using the portfolio interest exemption for offshore financing of mortgages on the land investment (which avoids US taxation and FIRPTA rules).
njp,
I don’t know what the HPI data sells for, but I believe a 1 year subscription to LoanPerformance for NJ was roughly $5,000.
Al Says:
May 1st, 2008 at 3:03 pm
as far as money market: my stocks are down 4% YOY, my downpayment in CD’s are up 4.85%. .. After taxes - well that would be 3%.
Al,
Give my boy Peter a call Europac he’ll straighen your portfolio and put you in Winning high yield, low P/E stocks. Swiss CD’s or Australian Dollar CD’s.
I’m up over 10% in my non gold positions and I’m barely braking even with my Gold. I bought some more today though.
269 john
“NJ patent you did not tell me what you do? I know of more jobs in the 150K to 350K range but I bet I could find one or two 120K jobs floating around if you like. I have a guranteed severance package in my contract otherwise I would use your services.”
You missed my response at 258. Please stop offering me jobs I don’t want. It’s embarrassing.
272 grim
Yeah. That’s not cheap. Pretorius, maybe you can bend your employer’s arm and sneak us some results here and there….
Hat tip to the NY Fed for making some of the NJ LoanPerformance data available for free.
http://www.newyorkfed.org/regional/subprime.html
We can’t drill down, but at least we have some insight.
“maybe you can bend your employer’s arm and sneak us some results here and there….”
Maybe everybody can click on that little donation button on the upper right hand side of the main page?
Ok NJpatent your friend Alex Baxter told me you are a BSD and I should be asking you for a job.
277 BC
I couldn’t agree more, although I think if grim gets $5K via that button he should spend it how he likes.
278 john
I haven’t a clue what you’re talking about.
280 proves you are in legal, however when I am over in 9 west 57th street you MA guys have the best digs and views.
If you are visiting my guys in 9 West, then yes.
Faulty statement: Houyse prices are tightly couples with jobs.If salaries are not raising and gasoline, medical and food are rasing 20%/year next year I have 10% less to spend on a house.
So inflation in consumer goods/services WITHOUT appropriate raise in salaies will actually lead to larger decrease in home prices.
True to a certain extent. It depends on how you define inflation. If the money supply is being expanded, this is monetary inflation (as opposed to price inflation). What you are currently seeing (in food and gasoline) is price inflation which has been caused (IMO) by speculation and the weakening dollar.
If we were having monetary inflation, you would in theory also see wage inflation, which would make housing more affordable. Now you can argue that the money supply is really expanding (see shadow stats M3 figures), but that’s another discussion.
http://en.wikipedia.org/wiki/Monetary_inflation
Al, my friend called me last night she is looking for a IT internal auditor with 15 years experience and a CISA to manage one person and work a 40 hour workweek at a hedge fund in NYC. Willing to pay up to 300k, no takers yet. The CISA exam is like 500 bucks and takes around 2 months of full time studying to pass. All the time I see high paying jobs with low barriers of entry with no takers. What I do see are people who will see that job and say audit is boring I don’t want to write people up all day, who wants to study for two months etc. I see very little people applying themselves and studying to pass a test or be willing to do a job they don’t like. It is all me me me me. I would make pipe bombs for the JDL if the price was right.
I think you forgot about the 15 years experience. That means it would take 15 years + 2 months to qualify.
hobokenite
“If we were having monetary inflation, you would in theory also see wage inflation”
In theory markets are efficient. I believe we are in the midst of rampant monetary inflation, and that we would only expect to see wage inflation if the monetary inflation didn’t exist to pay off debts. Or if you believe in trickle-down economics.
Can a Central Bank prop up their currency?
When they are running a 4 Billion a day deficit, printing money like it’s going out of style, economy is in a recession, housing is in a depresion, there is no savings, people are in debt to their eyeballs, Unemployment is rising, Inflation is high, Oil is $115 per barrel, it’s military is currently fighting a war for the past 3 yrs, Consumer is spent and can’t borrow, Debt is cheap but very difficult to get financing for anything.
Besides the empty rhetoric of stong dollar policy and flooding the market with Gold, Can the Fed really do anything to prop up the dollar?
We as a nation are the equivalent of Spitzer that we have continually beaten our chest and telling others how to live and controlled their house that once we become vulnerable our enemies and so called friends(french) will through us and our currency under the bus in a span of days.
Do you really thing that the foreign banks of Saudis, Russians, Chinese, Japanese etc won’t have the backing of their people if they bleed a little to kill the beast?
That’s why I bought Gold today!!
Unless you are talking M3, this graph seems to indicate otherwise:
http://en.wikipedia.org/wiki/Image:Changes_in_US_money_supply_1960-2007.gif
Those butter leather chairs and central park views over at 9 west 57st are best viewed while enjoying a gourmet free lunch. On a clear day you can see Yankee stadium. If it weren’t for those damm number crunchers jabbering away in the conference rooms it could be pure heaven. Those Tyco guys knew how to furnish a place back in the Dennis K days.
Nice weather we’re having, John.
John,
btw, here are the requirements for the CISA exam:
http://www.isaca.org/Template.cfm?Section=CISA_Certification&CONTENTID=20450&TEMPLATE=/ContentManagement/ContentDisplay.cfm
And it’s only offered twice/year, and it’s too late to register for the June exam.
re: 284 Hobokenite: Most of the jokers I know with the CISA cert don’t want to work 20 hours a week never mind 40, and working for a Hedge Fund as well would be an issue since there is no such thing as working 40 hours a week for the masters of the universe.
U.S. Offers 0% for First Time on Inflation-Linked Savings Bonds
By Vincent Del Giudice
May 1 (Bloomberg) — Widows and orphans may be facing more bad news.
Financial market turmoil has caused the fixed rate on the newest issue of Series I inflation-indexed savings bonds to fall to zero for the first time, according to the U.S. Treasury’s Bureau of Public Debt. Investors still get a return on the investment as long as consumer prices rise, because the government pays additional interest in lockstep with inflation.
The fixed rate’s decline to zero reflects the decline in returns in money markets in the aftermath of the credit collapse, said Kim Treat, a spokesman for the bureau in Washington. The government promotes the savings bonds as “low- risk” investments for individuals that protects them against inflation.
The so-called earnings rate on the bonds issued between May and October, which is tied to the rate of inflation, is 4.84 percent, the bureau said in a press release. The fixed rate, on top of the compensation for rising consumer prices, is officially 0.00 percent, down from 1.2 percent when the Series I was last issued, in November.
That means investors get no returns on their investments other than compensation for inflation. The fixed rate has never fallen so low since inflation-indexed savings bonds were introduced in the 1990s, Treat said.
John = yet another of the well-off, impossibly virtuous workers who still manage to find time during working hours to post here.
http://calculatedrisk.blogspot.com/2008/05/centex-cancellation-rate-falls.html
Centex: Calcellation rates rise
Actually, it says they’re falling.
OT: Any conspiracy theorists think this wasn’t suicide?
`D.C. Madam’ Committed Suicide by Hanging Herself, Police Say
http://www.bloomberg.com/apps/news?pid=20601110&sid=aoC2BnBwDPy0
Re 293 - I represent that remark!
Foreclosure News!
http://www.nytimes.com/reuters/sports/sports-canseco-foreclosure.html
Hobokinite,
You right. I meant it to come accross sarcastic. But I’m miserable when it come to written communication.
here’s what one blogger wrote:
CTX is simply liquidating is business down to nothing at pennies on the dollar.
What CTX is doing is similar to a homeowner selling his garage to make a mortgage payment. Then he tells his bank he is current.
Next he sells the backyard and pays down a few dollars in principal as well as next months payment. Again he brags that he is current.
After selling off the kitchen and third floor, the banks finally catch on what is going on and stops the homeownener from selling anything else.
My guess is that half of the publicly traded HBs will be at that point by the end of the year.
It is amazing that the world is so blind to a simple going out of business liquidation. Once you run out of inventory to liquiate, the game is over.
Observe how much CTX assets have declined over the past year but liabilities have remained persistently high.
http://www.nytimes.com/2008/05/01/fashion/01STEVE.html?em&ex=1209787200&en=64de6418c4ccbcf1&ei=5087%0A
Who was the dolt cheering GDP?
“About 0.3 percentage point of the first-quarter increase in the index was accounted for by the pay raise for federal civilian and military personnel, which is treated as an increase in the prices of employee services purchased by the federal
government.”
“The real change in private inventories added 0.81 percentage point to the first-quarter change in real GDP.”
http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm
jOHN(300)
Thanks. I just send that link to my wife. I’m embarrased to say what my Bloomingdales bill this month is.
BC,
enjoy…
Gold isn’t buying as much oil as it used to
http://www.platts.com/weblog/oilblog/2008/04/gold_isnt_buying_as_much_oil_a.html
A talking head on television this weekend was discussing the worldwide price of rice, and noted that its relationship to gold had changed little. Over the past several months, she said, the amount of rice that an ounce of gold would buy had not changed significantly.
This, of course, led The Barrel to check what had happened to the relationship between gold and oil these last few months. The numbers are sobering.
make,
Yes, it’s easy to lose/miss nuance in online communications. Maybe using tags will help:
/sarcasm
kettle [303],
There has been a major disconnect. The ratio will probably come back into play. The question, which one rises/falls? The cb’s of the world can, in the short term, manipulate the price of gold. They don’t have the same luxury with crude, the market is too large.
296 hard place
[raises hand]
she f*cked with the wrong guy….
298 hard
Sounds like jingle mail:
“I do have a judgment on my home and it to me is very strange because it didn’t make financial sense for me to keep paying a mortgage on a home that was basically owned by someone else,” he said.
Canseco said the foreclosure was not a difficult issue emotionally. But he sympathized with the millions of other Americans who have already lost, or face losing their homes, because of soaring interest rates on sub-prime loans.
“I decided to just let it go, but in most cases and most families, they have nowhere else to go,” he said.
296 [raises hand also]
Completely off topic - and it probably doesn’t mean anything, but… These was an honest-to-god squeeqee guy working 41st and Dyer Ave. on the way home today. I haven’t seen one in well over a decade. Take from it what you will.
301 BC
Ouch.
310 tosh
Sounds like the first robin of spring to me.
“These was an honest-to-god squeeqee guy working 41st and Dyer Ave. on the way home today. I haven’t seen one in well over a decade. Take from it what you will.”
Tosh,
Joe Girardi?
Grim or Rich,
Any chance you can help out with an address / history on MLS Reference number: 2817415 ?
Thanks if you’re around.
Can someone find me a 9-5 kush job that pays 300K like the one John describes? OK OK … i will take 200K.
Doyle,
156 Prospect
Purchased in May of 2003 for $430,000. Also a prior sale in ‘99 at $270,000.
No interior pictures so I can’t tell if it has been remodeled.
Thanks Grim, I was looking for pics too, the lack of internal pics is always fishy to me.
‘it is true a single income needed to pay a mortgage is just as risky as needed two to pay a mortgage’
Actually, it a mortgge that requires two incomes is riskier.
House panel OKs assistance on housing slump
WASHINGTON (AP) — Democrats and several Republicans on the House Financial Services Committee banded together Thursday to pass a $300 billion housing rescue package.
The vote was 46-21 to advance the bill, which would permit the government to insure new, cheaper mortgages for hundreds of thousands of struggling homeowners now facing foreclosure.
Ten Republicans shrugged off President Bush’s objections and joined all the Democrats present to support the bill, sponsored by Rep. Barney Frank, D-Mass., the committee chairman. Most of them are from areas hit hard by the mortgage meltdown.
309 kettle
And yet David Vitter remains a senator.
Strawman / NJPaitent,
I know a few people at 9West57 who are sweating their jobs at the moment.
PGC
Indeed.
Fresh thread!
damn all those layoffs
credit repair