Wed 4 Jun 2008
For those of you interested in Bergen County, Rich has provided an incredible set of charts based on New Jersey MLS (NJMLS) Bergen County data. While I’ve focused on GSMLS data, because of it’s broader coverage, its downside is that Bergen isn’t well covered. Just note that the 2008 numbers in the first three graphs are YTD. Be sure to thank Rich for putting together such a comprehensive set of charts.
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The first three graphs show a very interesting trend that has recently developed lately, a huge gap in between list and sold prices.
Anecdotally, we hear that “prices aren’t falling”, however we know the data does show that prices *are* falling. So what gives?
My guess is that most people are using asking prices as a proxy for the market, mainly because they don’t have access to sold price data. While it seems to be true that asking prices are increasing, actual sale prices are falling.
In the first chart, it appears that we currently have a gap of approximately $75,000 between list and sold. This is significantly greater than anything we’ve seen in the period between 1985 and 2005.
Look at how tightly those two datapoints tracked each other up until 2005, where the relationship appears to have broken down entirely, a complete disconnect between asking prices and sale prices.
” interesting trend that has recently developed lately, the huge gap in list and sold prices”
yes, I noticed this right trend right away. It sticks out like a sore thumb. Meaning to me, sellers are in denial, and better lower there prices to move inventory, or that price decline/crash is going to be 10x worse.
yikes.
this graph spells utter disaster for Bergen County.
great graphs, way to go!!
SAS
man, I was calling for avg 20-25% declines in Bergen.
I think I will retrack that and now call for 50%.
wow
SAS
May 2008 Warn Notices are posted:
http://lwd.dol.state.nj.us/labor/lwdhome/warn/2008/05-08warn.html
COMPANY CITY EFFECTIVE
DATE
WORKFORCE
AFFECTED
SONY BMG MUSIC
LYNDHURST
7/18/08
50
TRANE
PISCATAWAY
6/30/08
40
SALLIE MAE
MT. LAUREL
7/1/08
163
ARAMARK
CHERRY HILL
6/30/08
93
MUHLENBERG MED. CTR.
PLAINFIELD
7/4/08
18
EK SUCCESS
CLIFTON
6/1/08
134
COMPUTER SCIENCES
SECAUCUS
7/11/08
102
PHILIPS ELECTRONICS
LEDGEWOOD
7/1/08
50
JEVIC TRANSPORTATION
DELANCO/PISCATAWAY
5/19/08
1036
CELEBRATION
LUMBERTON
8/1/08
150
The Brass Rail is on the pricey side. Those of us going to the GTG might want to heloc their homes before attending.
Unfortunately I can’t make it. I get to go to a wedding.
Educational graphs with just the right overtones of Housing Terror.
I, too, was drawn to the wishing gap and all it portends. The inventory fireworks in bright orange left a nice aftertaste.
Very nice vintage.
- Housing Spectator
100 points.
Holy crap!
I’m going to take a closer look but Holy Crap!
I like how the “average list $” only slightly edges up between 2007 and 2008 as if the sellers are saying “Okay fine, sorry for being so greedy in the past. We’ll only look for slightly more than what my neighbors got in 2006″.
The wishing gap looks like dead meat along the side of the road to me. The only thing left is to see how stinky it gets before the scavengers pick apart the carcass.
bruiser,
What caught my eye was that in 2004 units sold and under contract where starting to decline and in 2005 those figures really started to drop until there was a nosedive in 2007. But up until 2006, prices were still going up.
Average price sold is still only $50k off the high in 2006 but I would expect that to drop by at least $100k by next year.
It’s funny though how the listing prices haven’t changed much. In fact the average listing price has gone up since last year.
Time for agents to realize the bubble has burst and the market needs to correct.
Grim $ Rich
Excellent work! The trends basically jive with what I have been charting in my neighborhood here in NE Monmouth except avg list is now coming down w/ even greater velocity (as I estimate it). Folks, this is data you can really use to make informed decisions with. Props to Rich and Grim, this site is f’ing priceless. Any buyer should have this type of data at the neighborhood level before making a purchase decision. When you reduce it to spreadsheets, and filter out the national and local media nonsense, the trends becomes so crystal clear. F’ing A plus…
grim Says:
June 4th, 2008 at 10:48 pm
Look at how tightly those two datapoints tracked each other up until 2005, where the relationship appears to have broken down entirely, a complete disconnect between asking prices and sale prices.
Surely points to the fact that the antecedents to lowballing have been in place for at least 2.5 -3 years now. Thanks Rich, I will remember this when I look through listings.
For now, in my searches in Somerset county, I have been using assessed value to get at least some idea of how off asking prices are from market prices, since those towns provide a re-eval every year (I assume based on market data). But this kind of sales/asking data is super-valuable.
“Time for agents to realize the bubble has burst and the market needs to correct”
I think sellers are the real ones in fantasy land.
If I was a seller, I’d lower my prices just to unload. At this point a 10-15% haircit is better than a %50.
If I was a potential buyer, you better hold and continue to rent for 08.
SAS
would these graphs still hold true if we took out the town of crackensack….err..I mean Hackensack from the calculations?
I would be interesting to see, what towns are holding their own vs. towns that are just getting hammered and are going to fold.
SAS
how long before we see a town in NJ declare bankrupcy?
SAS
“European Central Bank to remain on hold
Inflation pressures continue to call tune”
http://tinyurl.com/4sgb9x
SAS
grim and rich -
wonderful and frightening data. Seeing that growing rift between list and sold makes my stomach roll.
Thank you for sharing!
mike
Dumb question, but was the 2008 data adjusted for the fact there have only been five complete months? Can that be done easily, given that so many sales close during the summer? That seems to skew things a bit on the right side of the first graphs.
In the first three graphs, 2008 is YTD as of 6/3.
#12 sas:
You’re right about sellers. I can understand them having a hard time selling a home at less than what they owe on it, but that might be the reality a lot of people have to face.
While we’re on the topic of ‘acceptance/coming to terms’…
From Bloomberg:
MBIA, Ambac May Quit Aaa Battle on Moody’s Likely Cut
MBIA Inc. and Ambac Financial Group Inc. may give up attempts to retain Aaa credit ratings of their bond insurance units after Moody’s Investors Service put them under review for a second time this year.
The world’s largest bond insurers said they won’t raise capital after New York-based Moody’s said yesterday that the most likely result of its examination would be a downgrade of the companies’ insurance financial strength rankings.
Moody’s originally put Ambac and MBIA under review in January, only to affirm the ratings of MBIA a month later and Ambac in March. The credit rating company cited “meaningful uncertainty” about Ambac’s ability to regain market share since the first reviews, and “diminished new business prospects” for MBIA in yesterday’s announcement.
“You can’t go to somebody to raise capital if you don’t know what the rules for capital raising would be,” Armonk, New York-based MBIA Chief Executive Officer Jay Brown told reporters yesterday. “Goal posts move, targets change.”
Thanks, Rich!
That’s only six months overdue. I guess Moody’s must have gotten the nod from Bergabe/Paulson. This being a “free” market.
From CNBC:
Will the Housing Slump Reach Manhattan?
While most of the United States has suffered a housing slump over the past two years, home prices in New York’s Manhattan have been largely unscathed, propped up by demand from Wall Street bankers and the island’s limited housing supply.
That could change as the housing crisis comes back to bite the banks that securitized sketchy mortgages, leading to layoffs on Wall Street and smaller bonuses for bankers who keep their jobs.
“The market today is showing a significant reduction in new deals,” Hall F. Willkie, president of real estate firm Brown Harris Stevens in New York, said of residential real estate in Manhattan, New York City’s richest borough.
Willkie said during the first quarter of 2008, Brown Harris Stevens saw the number of contracts signed in Manhattan fall by 21 percent when compared to the same quarter in 2007.
The firm specializes in high-end properties, which he said continues to garner demand, partly due to foreign interest, but properties outside of this realm are seeing sales drop even more sharply, he said.
“Any real estate market is based on confidence and that is what drives it, so with all the uncertainty on Wall Street that confidence has been shaken,” Willkie said.
…
“When things started to get a bit shaky on Wall Street and I saw all the layoff announcements, it definitely made me think twice about spending the majority of the money that I have saved on an apartment,” he said.
“While my job looks safe for now, something could always happen in six months where I might not be able to make those monthly mortgage payments,” he said. Swiss-based UBS is one of the firms worst hit by the U.S. mortgage market meltdown.
…
Samuel Pierce, who recently graduated from the University of Pennsylvania’s Wharton School of Business, is one of a select few who is about to join Wall Street. On June 30, he will start working for Citigroup Citigroup Inc, one of the many companies that have announced layoffs in recent months.
While comfortable with the security of his upcoming job, Pierce said overall uneasiness has him leaning towards renting. “I also do not want to put money into an investment that might not retain its value,” he said.
…
The full impact of Wall Street layoffs on the Manhattan real estate market could take a year or possibly longer to work through.
“The Manhattan real estate market is at a turning point,” said Jonathan Miller, president and CEO of real estate appraisal firm Miller Samuel Inc. in New York. “What happens from here will largely depend on Wall Street and the state of the overall economy,” he said.
The number of homes on the market in Manhattan rose 4.6 percent to 6,194 in the first quarter from the same period last year, according to the Prudential Douglas Elliman Manhattan Market Overview quarterly report released early last month.
…
Yaralian, however, said he has not ruled out buying an apartment, but his gut is telling him to renew his current rental agreement for another year or rent another place. “For me, holding off for maybe another year seems to be a better idea,” Yaralian said.
From The Record
‘Shadow market’ flooding the nation with places to rent
Renters may be the biggest winners in the current housing slump, especially in places like Florida, Las Vegas and Southern California, with thousands of vacant for-sale and foreclosed homes and condos on the market.
Apartment vacancies are edging up in many areas of the country as frustrated sellers instead try to rent out their homes and condos in once red-hot housing markets. And that is making it harder for landlords to raise rents. In the toughest markets, apartment owners are even offering lease incentives to snag renters.
This “shadow market” of investor-owned homes and condos accounts for almost half of the rental stock, and attracts displaced homeowners more often than your typical apartment renter.
“What’s different now is the degree of excess homes and condos being put on the rental market. The sheer volume is creating more competition for traditional rental markets,” said Hessam Nadji, managing director at Marcus & Millichap Real Estate Investment Services, which analyzed the data for The Associated Press.
After staying relatively flat last year, apartment vacancies bumped up in the first quarter from the end of last year, the research showed. The vacancy rate is expected to rise by a half percentage point this year to 6.1 percent as the market absorbs about 3.3 million more rental home and condo units.
As layoffs bite Wall St, New York real estate hit
http://www.reuters.com/article/newsOne/idUSN1823695720080605
Awesome graphs Rich. I’m looking at that and seeing average SFH Sold$ coming back to around the $500k range.
Love all the data. The one variable and it would be difficult to obtain is the sq ft of the home. Than we can map out what we hear anectdotally is that the increase in sales price was also due to people increase the size of their McMansion purchases.
“As layoffs bite Wall St, New York real estate hit”
When? I been waiting since 2001 and prices keep going up and up and up.
If things are so gloomy in Bergen County, how come prices have dropped so little?
Maybe this blog is too dim and the reality is much better?
Rich-
Nice work. Confirms all the anecdata. I have plenty of colleagues in PBC who have been telling me for a couple of years that things ain’t so rosy.
Was going to try to make it to the GTG, but my soccer guys are advancing in a tournament. Time to sharpen the studs. :)
Frank (29)-
“Maybe this blog is too dim and the reality is much better?”
Blog = correct
Dim = you
Continuing Philly talk from yesterday:
Center City condos thriving
Sales have stayed stable, and value has appreciated.
By Alan J. Heavens
Inquirer Real Estate Writer
If you’re looking for property that hangs on to its value even when the real estate market twists and turns, a condominium in Center City may be what you seek. Two decades of sales downtown suggest that as a long-term investment, condos are remarkably bulletproof.
“Center City real estate has appreciated an average of 15 percent a year since 1985, greater than the inflation rate,” says Center City District executive director Paul Levy. “Condos aren’t something that you own for just 15 minutes. They are long-term investments with a proven record of appreciation.”
That’s consistent with the trend nationally, says Mark Zandi, chief economist for Moody’s Economy.com. “Downtown condo markets across the country have held up better than I would have expected,” he says, “given . . . demand and despite the glut of space.”
In the first quarter of 2008, data from the City Recorder of Deeds Office show, condo sales throughout Philadelphia stayed about even with the same quarter last year, at more than 500 units.
Thirty-two condos in Center City sold for $1 million or more in the first quarter, the data show. The most expensive went for $4.7 million at the Ayer on West Washington Square. For all of 2007, 115 condos sold for $1 million or more; in 2006, 49 sold. (More $1 million-plus condos are being built now, thus sales numbers for them are increasing.)
Currently, there are about 10,000 condo units in Center City, more than twice the 1990 number, because of new construction and conversion of nonresidential buildings encouraged by tax-abatement programs enacted by City Council in the late 1990s.
Hundreds of units are still in the pipeline. And despite slower sales regionally and in the city’s single-family-home market, most developers - especially those with high-rise and higher-end projects - appear to be hanging in.
Among such projects are 1706 Rittenhouse Street, 10 Rittenhouse Square, the Murano, and Residences at the Ritz-Carlton. Developer Carl Dranoff plans to break ground June 19 for 777 South Broad, a 146-unit, five-story condo building.
Not surprisingly, given the overall real estate market, some condo plans have not come to fruition. More than a dozen projects have been canceled, delayed or postponed over the last 18 months.
Newly built or not, Center City’s condos continue to draw a mix of buyers.
“You hear everyone saying this is an ideal market for first-time buyers, and it is,” says Matthew Young, 24, an engineer who has just closed on a $410,000 condo at Seventh and Bainbridge Streets.
“I was fortunate that, thanks to my savings and my family, I was able to put 60 percent down,” says Young, who searched for a month before finding what he wanted.
With 73 percent of Center City residents working downtown, Levy says, gas prices may prove as big a boost to real estate there as nightlife and cultural opportunities. “It soon may be cheaper to fly home to the edge of the suburbs,” he says.
“I didn’t want a car,” says consultant Gail S. Bowers, 46, who with her partner, Temple professor Barry Vacker, 51, has a contract on a 1,000-square-foot studio at 1352 Lofts on South Street near Broad. Prices there range from $349,000 to $1.4 million, says Kathy Conway of Prudential Fox & Roach.
Vacker, an architecture buff, wanted something built in the 20th or 21st century, and Bowers wanted a low-rise. Both wanted “fabulous space with a lot of light, and we got it,” she says.
There was a time, from 1987 to 1997, when condos in the city lost value. But data compiled by Kevin Gillen, a research fellow at Wharton and vice president of Econsult, a Philadelphia economic-forecasting service, show prices rising consistently since.
Through the fourth quarter of last year, prices appeared to be holding, or at least not falling precipitously, Gillen says. And during the first quarter of this year, which he describes as one of the slowest winters in years, condos were moving.
Prices of comparable units in older buildings show substantial gains over the last decade, without factoring in inflation. For example, a one-bedroom in Wanamaker House sold for $92,500 in 1997, and a comparable unit sold for $365,000 in 2007, according to records kept by Center City condo developer/Realtor Allan Domb.
A Society Hill Towers two-bedroom that went for $122,000 in 1997 sold for $550,000 last year. A one-bedroom in Academy House that brought $72,500 in 1997 sold for $310,000 last year.
If the 1997 prices were adjusted for inflation and condo values had been flat over those 10 years, the one-bedroom at Wanamaker House would cost $119,500 today, and the two-bedroom at Society Hill Towers $157,605.
In the first quarter, with 47 units claimed, the Arts Condominium at 13th and Locust Streets was the city’s best seller, deed records show. Of its 372 units, 371 have settled, says property manager Mary Galgon. Remaining is a $319,000 one-bedroom penthouse.
John Featherman, an agent with Prudential Fox & Roach, owns several condos at the Arts, sold about a dozen, and leased about 25 for clients.
“Where can someone have bought a studio for around $100,000 to $135,000?” Featherman asks. “The units are small and they generally have mini-kitchens, but you’ll take these units over a dorm.”
The quarter’s second-best seller was Parc Rittenhouse at 17th and Locust Streets, with 36 condos sold. Of its 260 units, 153 have closed, and 42 are set to close over the next 120 days.
Former New Jersey Superior Court Judge Steven Fluharty and his wife, Joan, have lived in their two-bedroom, two-bath unit with den at the Western Union Building at 11th and Locust Streets for about a month and are “just loving it,” he says. “Everyone said Rittenhouse [Square], but we wanted something close to everything but quieter. This was it.”
So far, just under 70 of the building’s 99 units, which go for $400,000 to $1.5 million, have sold, and more than 40 have settled, says Bruce Lang of Coldwell Banker Realty Corp., who is handling sales.
For a growing number of buyers, the Center City condo is a second home. Like Curtin and Lisa King of Northeast, Md., who in March bought a one-bedroom unit at the Winne on Front Street for about $379,000.
Both are in their 40s and are in marketing.
“My husband calls [the condo] an 800-square-foot addition to our home,” she says. “I had sold some real estate and we wanted to find a place to put the money to good use.”
They chose Philadelphia, “because the housing market is strong and healthy,” she says. “We are planning to spend a lot of time here.”
Look at how tightly [list versus sale price] tracked each other up until 2005, where the relationship appears to have broken down entirely, a complete disconnect between asking prices and sale prices.
When the market was hot, sellers could list their house at or near market and expect to get their price. For the most part sellers could confidently dismiss lowball offers.
Now, sellers seem to have adopted a “mall jewelry store” pricing strategy. They list too high, but are giving big discounts. Unfortunately, this strategy often backfires as way overpriced homes don’t even get looked at.
Still can’t get a house in Ridgewood for $200,000
Thought I’d drop my personal anecdotal story, I don’t post often but read every day. Thanks to grim et al for the info and lively dialogue.
I work for a small financial mgt firm in Princeton. We have around 20 employees and a little under $2 bln AUM. Things have been going quite well, the group has very low turnover and has been around since ‘86, the whole time in Princeton.
In Sept of next year, we are heading across the river to Newtown, PA. I grew up in essentially New Hope, PA (nearby also in Bucks Co.) We’re going to have our own building in the town which is being very welcoming to our business.
Why are we leaving? About half of our employees already choose to live in PA. Lower prop taxes, lower income taxes, cheaper car insurance, more house for the money, good public and private schools, lots of land, less traffic, etc. Our funds are assessed $100 per partner (just like every other fund) in NJ to electronically file a K1 which they don’t even use- that’s a million dollar BS expense that magically disappears across the river. There is constant talk and rumors about instituting a new ‘professional’ sales tax. Our rent in Princeton is going up (again, even though we’ve been tennants since ‘86) and they’re doing construction behind our building for probably the next 2-3 years building ‘luxury’ condos. Parking and traffic are out of control. We’ve heard from clients that they’d much rather go into PHL airport and take a car vs fighting their way from EWR which, as the crow flies, is closer to Princeton, but time-wise, much longer. To Newtwn it’s probably 45 min from PHL. Newtown is just off 95 so people who live in Philadelphia will have about a 35/40 min commute that ends long before the Scudders Falls brdge (which is also due for construction and delays.) Other people have a choice of tons of different towns and boro’s to suit their needs and lifestyles. It’s about 20 min to Trenton train station for easy enough access to NY and DC.
Why am I telling you all this? Because I feel like there will be more stories like this going forward. NJ through it’s laws, taxes, and its own reality essentially made the decision for us. They’re losing our tax revenue and the town is losing us getting our lunch daily from all the local shop if you know what I mean.
We’re excited for the move and we will miss many things about Princeton and NJ, but NYC is no longer commutable and many of the arguments for the extra expense no longer make sense. I’m fortunate to know the Bucks Co area intimately so I’ve taken joy into looking at real estate and seeing livable 3bd 2ba houses on 1/2 acre for $300k with $2500 /yr taxes in those magical blue ribbon sd’s. (you mean they exist in PA too?!? for less than $10k /year??!?)
I don’t think NJ will miss us and maybe they shouldn’t, but I’m not sure we’ll miss it either.
All,
Glad you like the info!
Frank (29),
This is playing out much faster (sold prices) than I anticipated.
Are you not looking at the inventory compared to sold data? You do realize what that portends?
Clot (30),
Was hoping to meet you. Good luck Saturday!
TBW (34),
When could you ever?
If you could get a decent one I would have purchased one back in 1995.
Why am I telling you all this? Because I feel like there will be more stories like this going forward.
Can’t say much.
Nice weather we’re having…
#31,
Clotpoll, as a RE shouldn’t you be more optimistic about home prices? How can you sell anything with a such dim view?
Jafo you can earn your way out of some AMT, if you make 250K a year and have 80K in deductions such as kids, stay at home wife, high state taxes and RE taxes you get nailed to the wall. But if you get a 400K raise but deductions stay at 80K you are much better off from an AMT point of view.
AMT is the bain of the middle class - 150K to 450K.
jafo Says:
June 4th, 2008 at 4:57 pm
On, AMT. So, everyone’s experience appears to be similar to what I read. However, I got folks who make significantly more than me in W2, saying they are able to deduct prop tax on primary properties. I am a single a filer, they have wives/kids. However, they say pay AMT and combined incomes are above phase out for even joint filing. So, what gives?
#35,
For every firm like yours, we have 5 Indian and Chinese firms moving in and for every 20 employees moving out, we have 100 Mexicans moving in, NJ will be O.K.
#40 - “….for every 20 employees moving out, we have 100 Mexicans moving in”.
So for every 1 professional we replace them with 5 illegals who are working off the books. Oh, that’ll just force RE prices through the roof!
#1 grim:While it seems to be true that asking prices are increasing, actual sale prices are falling
Understood.
But really why would people be increasing their asking prices in general?
Is the denial that great? Have they been living under a rock?
Nom
“NJpatient, I am confused. Are you still in Old City and working in NYC? ”
Nah - in Brigadoon working in NYC, wishing to go back to Philly (when I was there I lived on Fitler Square and then off Rittenhouse. Grew up in Manhattan, but Center City Philly feels like home to me.
RayC - you were a few years ahead of me, and no, our guys never dated DA girls because we were too dorky to get dates as a general matter.
Frank Says:
June 5th, 2008 at 8:43 am
#35,
For every firm like yours, we have 5 Indian and Chinese firms moving in and for every 20 employees moving out, we have 100 Mexicans moving in, NJ will be O.K.
I think I need to leave NJnasap if what frank is saying is true.
Just one side note:
Indian and chineese firms moving in??? REALLY?? I thought it was reverse!!!!
#42 - 3b -But really why would people be increasing their asking prices in general?
Is the denial that great? Have they been living under a rock?
The third option is that their debt has been growing.
The whole idea - we are going to turn NJ into another mexico City!!! it will be great epople. 5-6 families living in SFH!!! Meet you new enighbours… ALL 50 OF THEM!
Grim - what HTML tags are allowed on your site?
#39
John, how does that work, what happens above $450k?
“But really why would people be increasing their asking prices in general?”
Because they haven’t paid any principle down with their interest-only loan or second mortgage or HELOC, and and if they don’t sell for more than they bought they’ll lose after commissions and fees?
The numbers don’t look good. I had more to say so I posted them on my thoughts on the Wile E. Coyote Real Estate Strategy.
Wow, i just said a swear word audibly at work when I saw those graphs.
The amount of housing available as compared to previous years is COMPLETELY insane. Add this to a tighter credit crunch and all the layoffs planned as mentioned by grim in #4 and we will certainly see prices drop considerably in that area.
#29 - Frank, the truth is in data, not anecdotes.
TM (45)
The third option is that their debt has been growing.
I agree. Looking at tax records I’m amazed at the number who took equity out of their homes.
Basically, they’re hoping to hit the lottery with their house. Just as there’s nothing wrong with bidding low there’s nothing wrong with asking high.
http://www.dailybusinessreview.com/Web_Blog_Stories/June/Buying_debt.html?ref=patrick.net
Just for fun, name the song
told her I had always lived alone
And I probably always would
And all I wanted was my freedom
And she told me that she understood
But I let her do some of my laundry
And she slipped a few meals in between
And the next thing I remember, she was all moved in
And I was buying her a washing machine
On the note of neightbours:
I am already seeing a lot of indians have 3 generations living under one roof - small house 6-10 people.
Grandparents, parents and kids - sometimes kids are grown up as well.
While it makes housing costs very affordable for this particular family is it fair for their neighbours?
They pay RE taxes based on AVERAGE family taxes - and use a lot more in services, roads, schools and such.
How about starting to base RE taxes not on only value of a home but on number of residents in the house?
Rich: Thanks so much for the incredible work!! The realtors in Bergen Co will hate you.
Frank (31),
Clotpoll, as a RE shouldn’t you be more optimistic about home prices? How can you sell anything with a such dim view?
He should stick his head in the sand instead of taking a realistic approach to the market which in turn is his business and livelihood?
#53 - How about starting to base RE taxes not on only value of a home but on number of residents in the house?
And guarantee that these people move out because it’s no longer affordable to live here for anyone of moderate means no matter how hard they try.
Here is how you earn your way out of AMT. At 300k Amount of Adjustments and Preferences That Can Cause AMT to Apply in 2006 was 15,705 joint, 18,188 single, at 400K it is 16,970 joint and 40, 577 single at 500K it is 41,970 joint and 65,577 single.
As a married couple you are most likely to get hit at AMT at 300K in salary as that is when you get the lowest thresholds of adjustments and preferences that can cause AMT. At 300k the concept of moving income forward to earn your way out of AMT works best. Plus you need to figure out when you move income forward how much extra preferences you can move forward it any.
Even worse AL, they bunch up save cash and then give kids the downpayments for their house. So they screw you by not paying their share of RE taxes and they screw your kids when they have cash to buy their home. But hey there is nothing to stop you from bunching up, heck maybe they will let you live in a rubbermaid shed in their yard for $200 a month and you could really save some cash.
How about starting to base RE taxes not on only value of a home but on number of residents in the house?
Isn’t most of the property tax go towards schools?
If so, just base it on the number of kids a household has.
Isn’t most of the property tax go towards schools?
If so, just base it on the number of kids a household has.
If you do that might as well get rid of public schools altogether.
I guess the theory is that we all benefit when little Sally and little Johnie are in school and getting an education, learning to be productive members of society rather than loitering around, stealing or living off community services.
53 Al,
They have every right to move in and you have every right to move out! Once everyone is doing this school taxes will increase dramatically and it will eventually catch up with the them. Different cultures can change a town dramatically on every level. That being said this is America the melting pot and we are supposed to embrace this, no? Just goes to show how much of a doubled edge sword we all exist on.
These two are advertised as new listings. Can somebody expose the DOM?
2525612
2525611
Yeah, why should I pay to educate your kids? After all, when I’m 85 and need a doctor, or a dentist, or someone to help me go to the bathroom….well, I’ll just move to PA.
I guess the theory is that we all benefit when little Sally and little Johnie are in school and getting an education, learning to be productive members of society rather than loitering around, stealing or living off community services.
I agree.
Yet somehow the original poster was sweating some Indian grandfather using up all of a town’s resources on his daily two-hour walk around the neighborhood.
So volume is low, inventory is high, but prices are flat. Sounds like people need to accept reality and lower their prices. Any way you can get this info for Somerset county?
I’ll even put it together, just show me how I can find it.
Clue:
Narrow down some criteria (towns, type of property, date range), and I’ll send you a spreadsheet
It is not all about schools - how about 4 cars parket infront their house instead of 2?? How about traffic, polution, police, trash, electricity loads, heating emissions, general crowdiness??
It is not about fairness -tit is about them forcing me to move out of move in with my in-laws???
lets say town has 50% of SFH in which there are triple occupancy compare to other half. Does it put disproportionatly high taxes on lower occupancy people - ABSOLUTELLY.
In effect it forces them to move out.
As a matter of fact I would like NOTHING MORE than for public school system to disappear.
Turn all schools into charter/private and stop charging School portion of RE.
I agree.
Yet somehow the original poster was sweating some Indian grandfather using up all of a town’s resources on his daily two-hour walk around the neighborhood.
It’s not the Indian grandfather that uses up resources, it’s his pet. Cleaning up elephant droppings isn’t cheap plus the damages to the pavement, sidewalks, etc.
I vote that property taxes are directly proportioned to the number of elephants a household has.
I think Al is upset that they are gaming the system. If Al moves his grandparents in who paid 40 years worth of U.S. taxes and they get medicare payments etc. that is different from what is going on here. I actually know a pair of Indian doctors who have their grandparents living with them in their mansion and the grandparents are all on medicare without having ever worked a single day in this country. Even more fun, the kids treat their own parents once in awhile and put in a medicare claims. Plus I often see with the three generations under one roof cash being moved between generations to game the system to get financial aid etc.
It is not an Indian thing, but a lot of the new imigrants have one foot in this country and one foot in the old country and have no problem gaming the system. Our largest imigrant groups in the 20 century, Irish, Italian, Germany did not bring their parents with them and I guess were not smart enough to try and game the system they just put their noses to the grindstones and worked. That generation, pre internet, cheap long distance and airfares came to the USA and blended in quickly as they were cut off from their homelands. The new imigrants are quite different, they almost have more of a visitor mentality then the Ellis Island Statue of Libery mentality where they kissed the ground when they reached the US and never looked back.
Looks like I’m getting laid off in August. Is that enough reality for you Frank?
I’ve already planned my first week of unemployment.
Day 1 File for unemployment. Then bring my 2 kids and mother-in-law who doesn’t speak English (pretend she’s my wife) and pop in to see Clot (This would qualify as a psycho group so perhaps Clot will think we’re legit.)
Day 2 take my son and head to DC. Spend the rest of Day 2 and Day 3 thanking the Fed and the bozos on Capitol hill for creating this bubble and destroying the dollar. Plus find some time to check out the Air and Space Museum.
Day 3 evening start driving South.
Day 4 Arrive in Charlotte and hang out with Mitchell in his coffee shop.
Day 5 hit the North Carolina Zoo (Probably the best zoo on the East Coast). Then head to Charlottesville, Virginia.
Day 6 Check out Monticello, then drive home.
Day 7 Meet up with Gary to check out some open houses in BC. Make rude sarcastic comments to RE agents pushing overpriced houses. Point out that my unemployment checks will be much higher then their commissions (zero). Then enjoy a hoegarden(the beer, not a John story)
Week 2 is wide open.
Plus those Big Budda stautes on the front lawns with spot lights and running water keep me up at night.
If you are visiting a Ho Garden I want in!!
CNN: “Breaking News: Over 1 million homes are in foreclosure, as loans in trouble hit levels not seen since 1979, says bank group. More soon.”
71 bairen
I’m really sorry -
You’ve said before what your line of work was but I confess I’ve forgotten.
@35 Cirrus
You guys looking to hire? I’m currently at a financial firm in Summit and really don’t want to accept commuting to NYC for the next step. I would much rather work and live in PA than NJ anyday.
Al, if you’re trying to sound like John…it’s not working.
John,
Come to the GTG. Hoes a-plenty.
As a renter who is hoping to buy a home in the summer of 2009, this site has been a wonderful resource. Thanks to everybody who contributes.
I just had a question about declining real estate markets in NJ. My coworker went into contract to buy a home but the deal ended up falling through because he was required to have a bigger down payment due to the fact that the town he was looking to buy into was considered a ‘declining market’. i am looking to buy my first home hopefully next summer and plan to put together a 5-10% down payment. i’m worried that 10% won’t be enough if I end up finding a home in a ‘declining mkt’ area. does anybody have any information regarding which towns are considered ‘declining markets’? Thanks in advance.
“I guess the theory is that we all benefit when little Sally and little Johnie are in school and getting an education, learning to be productive members of society rather than loitering around, stealing or living off community services.”
Ridiculous. Little Sally and Johnnie need to learn to fend for themselves. The sooner they learn about the “free” “market” the better.
Does anyone here consider $575K a reasonable price for a 4br 2ba in Nutley? Granted, it’s in one of the nicest parts of town, close to schools, etc. But still….this seems like a 2006 price.
http://www.isoldmyhouse.com/index/NJ/140229.html
You know that faux wine that’s not wine - “Fre”?
From now on I’m calling it the Fre Market.
bairen, sounds good. Thanks for the preplanned agenda minus travel agent fees. I’ve been looking for a road trip suggestion for August, as well.
My spouse’s company is closing up his shop. Moving him (and me) to another state, if we take the offer. NJ may not be in our near-term future, after all.
2008, the summer of watching warn notices.
Re: 78
i don’t mean to infer anything about the female njrereport contingent. Post was meant about HOEboken in general.
I know a couple of second generation chinese kids tired of being treated like recent immigrants thus stopped caring about assimilation. In this Internet/Satellite TV age, the Korean kid in Bergen will have more in common with a kid in South Korea than a kid in Detroit. Get used to it.
Finally, if you did not pay taxes in the US, you do not get SS or Medicare. You may get Medicaid or Welfare.
If several generations live under one roof is that a bad thing? These people are bootstrapping and taking care of themselves instead of dumping their elders in a facility. Their kids who live at home are probably old enough to work and earning money, paying income taxes, or maybe going to university and saving money on room and board so they can become better citizens. They choose to live at home because they are welcome there by their parents. Now if they were all living under one roof and living off the public dole, drinking and being lazy that’s another story. I’m okay with the former, but not the latter.
#75 njpatient,
Thanks,
Right now I’m in corporate communications.
Before that I did 3 years as a house dad in Australia. (I also spent 1 year doing inside sales for home equity loans)
I did 6 years in middle office fixed income. I saw how bad the Wall St market was when we moved back from Australia and revised my resume to look for something different in NJ.
On the bright side it will keep us from buying a house this summer. There are actually some nice houses in our price range in the towns we like. We can rent another year and buy something nicer for less next year.
@67 Sybarite
I’m interested in Hiilsborough, Bridgewater, Manville, Raritan and Somerville single family homes of what I would consider to be entry level, and let’s say going back to 1980.
I want to see how crazy the run up in this area was. I think prices went up 100% from 2000-2006.
Rich if you can get me the raw data for Morris and Somerset then I’ll put together some charts for these counties.
bairen Says:
June 5th, 2008 at 10:17 am
#75 njpatient,
Thanks,
Right now I’m in corporate communications.
b: If you can fit it in and you have interest…..go hit one or more of these baseball games in Pittsburgh…
8/15-8/18…..
http://newyork.mets.mlb.com/schedule/index.jsp?c_id=nym&m=8&y=2008
I guess going to the brand new stadium in DC would also work and be more convenient to Charlotesville…
The other astonishing thing about these charts is that while volume was relatively the same from 1992 after the last slump through 2006, prices increased without any increase in volume. Can we attribute this all to lax lending standards allowing to borrow more money than they should have and have sellers aware of that?
Clue,
GSMLS data only goes back to mid-90’s. I still need more specifics on what you mean by entry-level. 2 bed, 1 bath? 3 bed, 2 bath? SFH or condo/coop?
Nothing that was unexpected…
U.S. Mortgage Delinquencies, Foreclosures Rise to 29-Year High
http://www.bloomberg.com/apps/news?pid=20601110&sid=ahEcmuOjgr4U
Syb
Oh, you want that specific. Okay. I’m looking for at least 2-3 beds and 1-2 bath SFH.
I just looked at the charts above and figured data went back as far as those did.
Should hit Newark Airport hard since it is a major hub for Continental
Continental Will Ground 67 Jets, Eliminate 3,000 Jobs (Update3)
http://www.bloomberg.com/apps/news?pid=20601110&sid=agR7OAEUpy_M
Clue,
I think Bergen county data resides on a separate database, which may go back further.
would love to see similiar figures and charts for morris county, NJ. Willing to pay in beer!
SIMONfromLYNDHURST (79),
The whole state may be considered declining by then. Why don’t you talk to a few lenders to see what they tell you? You’ll get to know the process and to become aware of closing costs.
Njkiwi (89),
NJMLS doesn’t cover those counties.
Well, more accuratly even though a unit can be listed on NJMLS for that area it primarily covers Bergen County. The numbers would be too small to find a true trend.
Syb
Ok. Mid 90s should be good enough. I figured having more data points would help emphasize just crazy the recent run up was, but even having 10 years of data should be able to show that.
I had some informal talks with the attorney representing our town regarding the tax appeal we will almost certainly be filing next year.
As I mentioned the other day, the house across the street from us, which has a larger lot and slightly higher square footage, is being listed on the market for $120k below their assessment. This house is old and needs work, so it is not the typical Montclair list low to garner multiple bids situation.
The house is assessed higher than us, and is listed below our current assessment. If they sell at that price, this will be comp number 1 to get us another 50k reduction off of our assessment.
I asked the attorney if the town would be willing to informally discuss a reduction in our assessment, prior to certifying assessments to Essex County in January, so that we could all avoid the expense of litigation for an appeal that we would almost certainly win. Mind you, if they certify our assessment and we later win a reduction from the County Tax Board, the town is on the hook for the overage that we pay to the county and the school board (they don’t refund to the town)in addition to all of their legal fees. The attorney told us that we will have to file with the county.
What a waste.
(95 & 97),
Yes, that data is from NLMLS.
FYI
I don’t know the history of the MLS and if or when it was merged with smaller MLS groups in the area to create one. But that may be one explanation for the jump in U/C between 1990 and 1991.
Or prices and rates came down… I truly don’t know.
WOW looks like I hit some nerves here!!
Yes I believe new immigrants 9I am one of them) are gaiming the system and putting “real” americans at dusadvantage - look a drivers licence office - they have freaking manuals on 12 languages - who pays for it??? Did russians paying for having tests in russian - is there special russian tax?? Learn the freaking language ( I ma soviet union native, russian is my first language - I hate russian immigrants in USAm, they are just so sleasy and sneaky).
I also hate Indian hern mentality - you get one Indian at work - in 5 years there will be 80% indians. They prefer hiring indians over americans/other nations.
Lets see a response to thi one.
I say - white americans are very discriminated not only by official guidelines and policies , but actually but foreign immigrants as well!!!!
I really need to run spellcheck on my posts.
Off for few hours.
Hey 85, I was just stating facts. If the Chinese or Korean kids did not have assess to the internet or cheap long distance and any access to any Korean or Chinese TV, movies or newspapers they would assimilate quicker. The Italians who moved to Brooklyn in the 1920s grandchildren would still be speaking Italian and working as shoemakers in the year 2008 if they had such free access to the old country. Short term it is great for those kids that they can stay in touch, long term it just continues to alienate them and hold them back.
Al, spell check is the least of your problems, you got major issues.
Clue,
Gonna take me a while, as there will be thousands of data points and you can only download 200 at a clip. I should be able to crank it out in 20-30 min or so.
#103 Al
Could you please repost that on as many website as you possibly can. It’s about time somebody admits that whites “natives” in this country get the shaft.
#102 Rich: Well I can tell you prices and rates came down. I rememebr that time well.
NNJ Says:
June 5th, 2008 at 10:49 am
Al, spell check is the least of your problems, you got major issues.
Truth hurts?
Al, As Andrew Dice Clay said their should be a sign at airport that says “If you can’t read this sign go back to the country you came from”
107
Syb
Thanks a lot. I really appreciate it.
#111, if that were true, many posters here would still be in the old country along with their parents and grandparents.
John Says:
June 5th, 2008 at 10:52 am
Al, As Andrew Dice Clay said their should be a sign at airport that says “If you can’t read this sign go back to the country you came from”
As I said before - look at thouse nice Spanish speaking people around you. Think: id 50years when they are Majority in htis country will they be willing to pay for bilingual education for your great grand-kids?
I guess we will kind of know sooner - France will be muslim majority in 20 years.
but you know what - I say US citizen deserved it as they are not protesting at all.
Al Says:
Truth hurts
Truth is that the world is now a much more mobile place. Get used to it.
114 - John..
“but you know what - I say US citizen deserved it as they are not protesting at all.”
I agree. Glad that the Native Americans did not think of protesting 400 years ago.
#105 John: Gee, the Chinese and Korean kids I know,are doing quite well. And they are quite assimilated, but they are in many cases smarter, because they do study,and are organaized and disciplined. Their parents demand it.
Go to your local grammar schools, Spring talent show. The Chinese and Korean kids play the violin, piano or some other instruemnt that takes time, practice and discipline.
The white kids are doing some Brittany Spears or some rap act imitation.
The Asian kid is taking his/her second SAT test, the white kid cannot, becasue it will interfere with travel basbeball. Not generalizing, but I have seen it time and time again over the years.
You’re right about sellers. I can understand them having a hard time selling a home at less than what they owe on it, but that might be the reality a lot of people have to face.
Can i just say how amazed i am at how many houses i’ve seen that are either vacant, short sale, REO or a combination… We’ve only walked into 1 house so far where i’ve met the owner, and that property was even a short sale.
to Al at #103
I find your comments offensive in that I married someone from another country, i.e., Taiwan. She is not “gaming the system”. Hell, she is even an adjunct professor at a county college and gained her employment there by showing up on campus and “cold-calling”. I wonder if you showed as much initiative when you acquired employment.
Oh, did I mention that I have son with this woman? May be in the past I would not find your comments so bothersome, but something happens when you have kids and you finally have to deal with racism. As a white male, I never had to deal with that. Now, I will not tolerate it as it affects my son.
Bairen, do you by any chance work for a certain Swiss bank on the brink of insolvency or do you work for the American bank on the brink of insolvency. I know both of these banks are cutting staff like crazy, the others it seems like less and many people I know leaving these places are going to other banks. If you work in finance and were laid off 75% chance you were at Citi, UBS, Bear, or JPM-Chase, if you work in Jersey than it goes to 90% Citi or UBS. Does anyone else get this same impression? I think both UBS and Citi might get broken up?
I’m a former smoker, and there is no worse critic of smokers.
Al, you are a former immigrant. You beatch too much to continue to consider yourself an immigrant, so stop saying “I am one of them.”
You’re now officially just another guy from Jersey bullying the new kid.
On a side note, I know a company in parsippany looking for finance expert. need cpa/mba. Maybe you can get my email address from grim if you need to contact me.
For those who may care. UBS announced today that they were unable to find a buyer for their municipal bond business,and will be shutting the department at the end of the month.
Rich:
Those are GREAT diagrams on how to build a quarter-pipe, I’m glad Bergen county is good for something in this state. Makes me want to go buy a skateboard again.
R
Morpheus Says:
June 5th, 2008 at 11:02 am
to Al at #103
I find your comments offensive in that I married someone from another country
Why are you offended with my comment???
I did not say ALL immigrants are gaining the system. Just most of us.
And by no means I said that your wife in particular is gaiming the system.
I wonder if you showed as much initiative when you acquired employment.
I live off wellfare. I do not need to work. No interview was required to get the check!!!
:)
3B (109),
I recall as well, as ‘91 was one I purchased my first home.
I’m going to send my email address to Grim to forward on to you.
Italics Off
P.S. If you want to be offended - watch Boradt - I lasted for about 10 minutes. it is just wasn’t funny.
Not really offensive, just could not believe people paid money to see it.
John [39] or anyone else
Is their a way to model your AMT exposure from one tax year ot the next? We filed separately last year w/ std deductions as we rent. We will file jointly this year, with a child, and potentally a home purchase, so our deductions would shoot up. Is their an easy way to assess the AMT risk?
#101…doesn’t Town/County get a 15% margin of error, so they can be up to $90,000 off on a $600,000 assessment and still “win”.
This was the case when we filed on behalf of 130 unit complex back in the late 1980’s. Only when we fell to 50% of assessment did we actually win a reduction.
#126 Rich; Great.
Clue:
Where to send XLS?
to al in #125, 127:
Touche!. I guess I am a little sensitive. I did not find Borat funny. Hell, I like mel brooks, so Borat I did not find offensive. Just was not that funny.
I hate to agree but Al is somewhat correct, in my experience Indians, Chinese, and Russian immigrants are quite exclusionary, not all but some. I have had Indian friends tell me that their manager hires mainly Indians from a certain area of India and a certain caste. I have seen the same of some Asian people not typically as bad, and the same of some of the Russians although with them it seems more of speaking Russian. I have witnessed unofficial meetings taking place in languages other than English.
Now I am friends with many people who are first(As Children) and second generation immigrants they are great people and come from interesting cultures and I welcome them here and think they deserve the same opportunities and treatment as I do. But, and here is the big but I think some more recent immigrants not all expect the American dream to come easily or freely. I truly believe if you expect to get the good job and be paid top dollar you should speak understandable english, but somehow I have seen teams where speaking a dialect of Hindi is more important than coherent english. Also Asians and Indians in general are very racist against Black people, I have witnessed some very condescending meetings involving Indian managers and Black managers.
Discrimination is a terrible thing and while Asians and Indians may be discriminated against it does not make it right for them to discriminate against especially assimilated Americans white or black.
Borat was awesome.
3b, that sucks I know people who work at UBS in munis who were hoping for a sale so they could keep their jobs for at least a while. You would think munis would still be viable as there is a need but I guess UBS’s rep is so tarnished they aren’t getting the reissues.
This talk of immigrants makes me wonder if HP Keith has been posting here under another identity. Nothing makes his blood boil quite like talk of amnesty for illegal immigrants… I mean, undocumented workers.
I noticed within the pharma field, Indians and Chinese tend to work technical positions. Their children tend to stay away from science and go into medicine, law, or finance. The arrival generation lives frugally and buys homes in good school districts so that the US-raised generation can have a head start. Just a broad generalization.
For the record I am for some kind of immigration policy for illegals, but against H1B abuse. Companies use it to keep wages down and also basically work the H1B people like indentured servants.
Nice weather we are having.
#90 chifi
I’ve been to the old 3 Rivers stadium when I was a kid. Could be interesting road trip.
#120 jcer,
Currently not in finance. I used to work for Citi. In both NY and Sydney. (Quit NY to move to Sydney. Quit Sydney to become stay at home dad).
regarding immigrant assimilation, apparently it’s faster than it used to be:
http://www.usatoday.com/news/nation/2008-05-13-assimilation_N.htm
“Yet the rapid growth since 1990 has not caused as dramatic a decline in assimilation, Vigdor says.
Immigrants who arrived in the past 25 years have assimilated faster than their counterparts of a century ago, he says.”
chi/bairen
PNC park (new(ish) PIT park) is gorgeous
129 - If your assessment was actually below market value they would get a 15% cushion above the common level. However, state law never allows you to be assessed over our actual true market value.
Our town did a revaluation at the peak of market, so we are riding the market down and appealing our assessment downwards along the way.
Since most folks don’t realize they can do this, the net result of our keeping our assessment accurate is actually reducing our property taxes.
RE Chart - Thanks Rich.
As to the asking/sales gap - that is exactly why Ihave basically taken myself out of the market. Until the percentage of realistic asking prices goes from the current 3% to around 50% of listings, it is a waste of time looking.
One theory - a lot of sellers are confusing market price offers with lowballs - and pricing up to have the “reduction built in”. Idiots.
Al Says:
June 5th, 2008 at 10:01 am
“As a matter of fact I would like NOTHING MORE than for public school system to disappear.
Turn all schools into charter/private and stop charging School portion of RE.”
I’ll agree to that when EVERY single person who received a state education, and every person whose kids have finished school ponies up and pays the people back at todays market rate.
Any takers?
129 - One more note - the 15% cushion is not off the market value, it is above the common level ratio for the town for that tax year.
i.e. if the common level ratio (average assessment to sales price ratio for the town) is 50%, the 15% cushion the town gets is 15% of the 50% - which is actually 7.5%.
It’s a bit complex and not very intuitive. Probably deliberate to discourage people from appealing.
Immigrants who arrived in the past 25 years have assimilated faster than their counterparts of a century ago, he says.”
You’re going to use facts against these tried-and-true third-person anecdotes???
#135 jcer: UBS will be keeping their sales and trading desk, to service theri existing retail account base, similar to what Credit Suisse did when they got rid of their muni buiness (old First Boston), back in the late 80’s.
However, the public finance and underwriting business will be gone from UBs come end of June.
So the white man is the victim of discrimination in this country - really?
Take a good look at the ‘elites’ in the US and
tell me that this proposition is true. As for mexicans or other laborers that you’re delicate eyes find so hard to behold, where is your anger at the white guys who run the two bit landscaping and construction “companies” that employ them. How about that shop in town that employs immigrant labor, ever complain to the owner or is he a neighbor of yours? Forget about the fact that these folks rent in your town from your white neighbor landlords. Do those rents pay RE taxes? When these folks buy in the grocery store dont they pay sales tax? As for gaming the system, if the “scheme” works so well why do you continue to work yourself when you propurt that those gaming the system have got it made? What are you waiting for. Look , if you live in a place where there is an influx of immigrants face the fact that you are not in the middle class and you live in a community that is lower class. Deal with the fact that you are poor and white, it is not anyones fault but your own. Why not leave NJ for another region where your white sensibilities are not offended. Growing up I knew of many acquaintences with there grandma and grandpa from the old country (pick a european country - think italy for instance) Gamma and grandpa didnt speak a lick of english should they have been sent back? With the ignorant attitudes and worldviews expressed here by a select some it is not hard to imagine how some folks got screwed in real estate. And a assimilated immigrant now spewing the same ignorant bigoted comments that come from ignorant bigoted americans - well that takes the cake.
Love it or leave it.
Post your comments somewhere where people actually give a crap about your ignorant complaints.
“If you can’t read this sign go back to the country you came from”
still trying to process this in my mind :-)
Sybarite Says:
June 5th, 2008 at 10:15 am
Re: 78
“i don’t mean to infer anything about the female njrereport contingent. Post was meant about HOEboken in general.”
That’s OK. I view “hoing” as a profession, not a female attribute.
just because we were right about the real estate bubble doesn’t mean we have the answers to all of the major social/economic issues of the day - come on, we’re just mere mortals!
John - immigrants aren’t allowed to claim any welfare benefits at all. They can only get SS, and only after paying in. My other half is one, and I had to sign all sorts of papers agreeing to be responsible for him regardless of our marital status.
Of course he pays plenty of taxes that pay out other peoples welfare benefits.
Bairen - my sympathies. Weren’t you job hunting?
River Vale ACTIVE Comp Killer!
2612270 Sold
SLD 142 RIVERVALE RD $717,000 7/5/2006
2815111 Withdrawn
ACT 142 RIVERVALE RD $739,000 4/14/2008
W-U 142 RIVERVALE RD $739,000 6/4/2008
2822852 Active
ACT 142 RIVERVALE RD $699,000 6/5/2008
JBJB Says:
June 5th, 2008 at 11:15 am
Use the AMT calculator on the IRS website, you plug in some stuff and it tells you if you will be in AMT next year.
Funny thing about a lot of API (Asian Pacific Islanders) people is they have a huge headstart in life. Mom and Dad take a huge interest in their education, they study like crazy, they memorize everything, have tutors and top of line SAT prep courses. They do all the right things marry young, buy property right away, stay out of trouble and are model citizens. But something happens at around 35 to 40 years of age when you reach a certain level and they hit the bamboo ceiling. With little real life experience and a lack of risk taking or original concepts they often get stuck at the VP level. At one point I had 40 direct reports who were Japanese and did consulting at Japanese firms. Been to Japan lots of times. I got stuck with sales calls, HR issues, dinners, client problems, chit chat, billing, interviewing you name it all the soft skills. I did not have the technical skills as my staff, nor did I have anywhere near their education levels or even close to their GPAs. But street smarts were lacking.
John [39] or anyone else
Is their a way to model your AMT exposure from one tax year ot the next? We filed separately last year w/ std deductions as we rent. We will file jointly this year, with a child, and potentally a home purchase, so our deductions would shoot up. Is their an easy way to assess the AMT risk?
Saddle River ACTIVE Comp Killer!
2522603 Sold
SLD 1 ESLER LN $1,545,000 2/24/2006
2703231 Expired
ACT 1 ESLER LN $1,679,900 1/24/2007
ACT* 1 ESLER LN $1,679,900 1/27/2007
ARR 1 ESLER LN $1,679,900 2/7/2007
EXP 1 ESLER LN $1,679,900 1/25/2008
2822833 Active
ACT 1 ESLER LN $1,449,900 6/5/2008
hirono, the problem is many fold, abuses occur at the hands of many different people. As for poor that is certainly not true immigrants are everywhere, go to LI you will see homes in suburbia with 20 people in them all migrant workers. That is simply not right I wouldn’t care if they were born in Cleavland to english parents.
You can think these comments are bigoted but there is some honest truth in them.
#154 lishoosh,
I was starting to look (not too hard). After we got the news I switched my online resumes to public view.
Hopefully will find something before the axe falls.
If not may look into job retraining. Supposedly you can collect full unemployment if you have been laid off and go back to school full time. Don’t know if this applies to Master programs. Could see going for a Master’s in HR if that’s the case.
Englewood ACTIVE Comp Killer!
2540803 Sold
SLD 426 CURRY AVE $467,000 5/2/2006
2740930 Withdrawn
ACT 426 CURRY AVE $545,000 10/8/2007
W-T 426 CURRY AVE $545,000 2/6/2008
2806840 Active (subject to bank approval)
ACT 426 CURRY AVE $399,000 2/18/2008
PCH 426 CURRY AVE $379,000 3/28/2008
ACT* 426 CURRY AVE $379,000 5/17/2008
ARR 426 CURRY AVE $379,000 6/5/2008
PCH 426 CURRY AVE $349,000 6/5/2008
There’s liable to be less ho in Hoboken, they all travel to the shore in the Summer, along with da guidos
Then they should change the name from HO-boken!
syb
ademaio53@hotmail.com
thanks a lot!
http://www.cnbc.com/id/24986616
Richmond Federal Reserve Bank President Jeffrey Lacker, in a telephone interview, also said saving troubled U.S. investment bank Bear Stearns was an “excruciating dilemma” that warranted a major expansion of the Fed’s supervisory powers.
great graphs.
agree that list prices are in fantasy land. sellers wonder why no one is even looking or bidding and this is why
[43] patient,
I recalled too late that you mentioned Brigadoon.
Now I can’t wait for GTG since we have probably seen each other around Fitler. I was on Naudain from 2002 until a few months ago.
Re: 426 CURRY AVE
Good thing those train tracks separated it from the cemetery or it may have sold for even less!
#160 Rich: More like comp slaughter!!
Supposedly you can collect full unemployment if you have been laid off and go back to school full time.
If the training is for an in-demand profession. What they deem in-demand is arbitrary.
Tom (167),
Sad thing is, it hasn’t sold yet. That’s the latest asking price.
I guess I should call these Future Comp Killers?
#143, hope that is the deal, took Saul Wolfe 3 years to get our money back…assessed at $150,000 and 3 years of actual sales dropping from $120’s to $100,00s to 80’s…..
#146, Montclair just did a reval..the ratio is probably near 100%
bairen Says:
June 5th, 2008 at 11:40 am
#90 chifi
I’ve been to the old 3 Rivers stadium when I was a kid. Could be interesting road trip.
bairen: best park in MLB hands down is Wrigley…
Of the following group that I have attended:
Yankee Stadium
Shea
Camden Yards
Fenway
Comerica
Jacobs Field
New Comiskey (U.S. Cell)
SafeCo
Citizens Bank
PacBell/AT&T
RFK
PNC friggin’ destroys them….it has the feel and size of a minor league ballpark, it overlooks the downtown skyline….AND to top it off Pittsburgh is cheap and the team is not drawing, so you can pick up excellent tix without scalping…….
BATTING PRACTICE IS NOT TO BE MISSED!
GO TO THE BLEACHER SECTION IN LEFT, YOU WILL BE PELTED WITH FLY BALLS!!!!
166 nom
“I was on Naudain from 2002 until a few months ago.”
we vacated Fitler in late ‘00, moved to Spruce and 21st until summer ‘02 and then back to NYC, so probably almost missed you.
Almost moved to Naudain in ‘00 - found a nice big 2BR for cheap but the LR and DR were in the basement with no light, so we went for the huge 1BR on Spruce with the roof deck. We grew an incredible container garden up there - several kinds of tomatoes, several kinds of peppers, carrots, lettuce, peas, beans, cauliflower, brussels sprouts, zucchini - it was wild.
Stay here…..
http://www.starwoodhotels.com/sheraton/property/overview/index.html?propertyID=693&PS=PS_aa_SSP_Central_Sheraton_Station_Square_Hotel_POP_060107_NAD_FM
chi
“best park in MLB hands down is Wrigley…”
agree.
and your review of PNC Park is spot on - but to add the view of the big yellow suspension bridge over the outfield wall in the foreground of that skyline.
BREAKING
NEWS
Fed: Net worth of U.S. households declined $1.7 trillion in the first quarter, 2nd straight drop after rising steadily since 2003.
69: That’ll never fly! This country was founded in part on its opposition to The Stampy Tax.
From MarketWatch
Mortgages in foreclosure jump in first quarter
Foreclosure starts, delinquency rate also rise in first months of 2008: MBA
More homeowners headed toward foreclosure in the first three months of 2008, as both the percentage of loans somewhere in the foreclosure process as well as the rate of foreclosure starts reached levels not seen since 1979, the Mortgage Bankers Association reported on Thursday.
The percentage of loans in the foreclosure process at the end of the first quarter rose to 2.47% of all mortgages outstanding on one- to four-unit properties, up from 2.04% in the fourth quarter, according to the MBA’s latest National Delinquency Survey. In the first quarter of 2007, 1.28% of loans were in the foreclosure process.
Loans entering the foreclosure process rose to a seasonally adjusted 0.99%, up from 0.83% in the fourth quarter and 0.58% in the first quarter of 2007.
The seasonally adjusted delinquency rate for mortgage loans also was the highest since 1979, with 6.35% of all loans at least one payment past due during the first quarter, up from 5.82% in the fourth quarter and 4.84% in the first quarter of 2007. The delinquency rate doesn’t include mortgages in foreclosure.
Foreclosure start rates were up for all types of mortgages, and that’s a reflection of the decline in home prices, said Jay Brinkmann, MBA vice president for research and economics. Some of the biggest problems appeared in areas where overbuilding occurred during the real-estate boom, and extra supply is lingering on the market.
…
Adjustable-rate mortgages are also driving the foreclosure start rates.
“For example, while subprime ARMs represent 6% of the loans outstanding, they represented 39% of the foreclosures started during the first quarter. Prime ARMs represent 15% of the loans outstanding, but 23% of the foreclosures started,” Brinkmann said in a news release. “Out of the approximately 516,000 foreclosures started during the first quarter, subprime ARM loans accounted for about 195,000 and prime ARM loans 117,000, but the increase in prime ARM foreclosure (starts) exceeded subprime ARM foreclosure (starts) with increases of 29,000 and 20,000 respectively over the previous quarter.”
Alt-A loans (often prime loans received with little or no income documentation) as well as option ARMs drove increases in foreclosure starts among prime ARMs, Brinkmann said.
Prime fixed-rate loan foreclosure starts rose to 0.29% in the first quarter, up from 0.22% in the fourth quarter, and prime ARM foreclosure starts rose to 1.55%, up from 1.06%. Subprime fixed-rate foreclosure starts rose to 1.80% from 1.52% in the previous quarter and subprime ARM starts rose to 6.35% from 5.29%.
if more white people saved their money and worked their *sses off like immigrants, we would collectively be in much better shape right now.
Just received this today from a real estate school in Monmouth Co. Price? Just $19.95. Absolutely brilliant:
Dear __________,
Please join us on Monday June 9th at Noon. We will have a Sheriff sale class followed by a class trip to the Monmouth County Sheriff sale. The class will meet at our Old Bridge Location. After a brief class on how foreclosures work we will go as a group to the Monmouth County Sheriff sale. We will also stop at the Monmouth County Clerks office to see where all the records are kept. This is important information in today’s market. Do not get left behind!
If they offered Jagermeister, cigars and shot girls, I’d be down for this.
NEW YORK (CNNMoney.com) — Americans saw their net worth decline by $1.7 trillion in the first quarter, as declines in home values and the stock market ravaged their holdings.
The net worth of U.S. households fell 3% to $56 trillion at the end of March, according to the Federal Reserve’s flow of funds report, which was released Thursday.
The drop marks the second straight decline in net worth, which fell by more than $500 billion in the fourth quarter of 2007. Until then, net worth had risen steadily since 2003, climbing nearly 31% over those five years. During the bear market of 2000 through 2002, household’s net worth dropped 6.2%.
The recent declines, however, may not affect consumer spending, said Michael Englund, senior economist with Action Economics. Americans have actually spent more in recent months, particularly at the gas pump as fuel prices soar.
“These quarterly swings are almost completely uncorrelated with quarterly swings in consumption,” Englund said. Americans “are spending everything in their wallet and borrowing more. But because the pump takes so much more of their dollars, they are buying fewer t-shirts.”
Frank (38)-
“Clotpoll, as a RE shouldn’t you be more optimistic about home prices? How can you sell anything with a such dim view?”
Frank, as a paid RE professional, my job is to maintain a view that is neither “happy-happy-joy-joy” nor “dim”. My job is to see things the way they are. Whenever I fail to see things the way they are, both my clients and I get crushed by Mr. Market. Believe me, that crushing has been delivered plenty of times over the years…and every time I receive one, I become more determined to learn from it and not get crushed again.
Of course, the whole object of the game- in the position of a broker/owner like me- is not to absorb a fatal crushing. The fastest way I know to get dealt such a death blow is to become caught up in self-administering what I like to call “sunshine en@mas”. I leave that to the Tony Robbins crowd. Being motivated to get out of bed every day and to work to a purpose has nothing to do with properly approaching deteriorating RE markets. I like to think of myself as a happy, fairly successful, hard-working RE professional…but I freely admit that I’m making a living tilling the gardens of misery and working with a set of clients and properties that a talented writer could draw on to write an award-winning screenplay.
And, I am (to use your words) “optimistic” about home prices. The faster they fall, the faster deal volume returns to my business. That day can’t come too soon.
I wish they would, so China would go bankrupt once they longer had a steady stream of oval eyed suckers to buy their crap.
skep-tic Says:
June 5th, 2008 at 1:10 pm
if more white people saved their money and worked their *sses off like immigrants, we would collectively be in much better shape right now.
http://www.nj.com/news/index.ssf/2008/06/plans_move_forward_to_revive_l.html
Plans move forward to revive Lackawanna Cutoff rail line
A couple of builders should be forced to build that thing for free.
Forget about taxpayers doing it.
Give the first three builders who volunteer total development rights for the stations and any county-owned land sales for the ten years following completion.
http://en.wikipedia.org/wiki/Lackawanna_Cutoff
John Says:
June 5th, 2008 at 1:29 pm
I wish they would, so China would go bankrupt once they longer had a steady stream of oval eyed suckers to buy their crap.
skep-tic Says:
June 5th, 2008 at 1:10 pm
if more white people saved their money and worked their *sses off like immigrants, we would collectively be in much better shape right now.
If they did we no longer could have talks about $300 jeans and fuel guzzling SUV’s.
Can anyone give me a history (OLP & DOM etc.) on
MLS# 2522338
Thanks
From MarketWatch
U.S. banks not out of the woods, regulators say
FDIC anticipates uptick in the number of failures
U.S. banks remain vulnerable to turmoil in the financial markets despite some improvement in conditions, top financial regulators told a Senate panel Thursday.
The fallout from market turmoil for banks will persist for months, with poor earnings, deteriorating loan quality and further write-downs ahead, said U.S. Federal Reserve Vice Chairman Donald Kohn.
(Wait, wait, wait, let me! But Bi said there would be no more write-downs.)
…
All told, the 50 largest banks lost $9 billion in the fourth quarter of 2007. They reported nearly $10 billion in net income for the first quarter, but this was down sharply from the previous year.
In addition, nonperforming assets as a share of overall assets reached their highest level since 2002. Loan-loss provisions rose to $32 billion in the first three months of the year.
“We expect bank holding companies to continue to report weak earnings and further asset valuation write-downs and/or significant credit costs in coming quarters,” Kohn said.
…
Bair of the FDIC said she expects bank failures to continue to pick up this year.
“We expect that bank failure activity in the near term will be higher,” Bair said.
So far in 2008, four banks with assets of $2.2 billion have failed, costing taxpayers $225 million.
Moreover, there were 90 banks with $26.3 billion in assets on the FDIC’s list of “problem banks” at the end of the first quarter.
The trouble facing smaller banks is a concentration on construction loans.
“The construction and development segment of commercial real-estate lending stands out as the most important short-term credit-quality issue,” Bair said.
Loss rates in this sector have “risen dramatically,” she said, adding that they are likely to continue to grow.
What ever happened to $300 Jean? I miss their grating posts.
JB,
A post on bank failures from MarketWatch in moderation (along with a duplicate of that post)
Waldwick FUTURE Comp Killer!
2434004 Sold
SLD 17 LOCKWOOD DR $659,000 2/18/2005
2616383 Withdrawn
ACT 17 LOCKWOOD DR $769,000 4/29/2006
W-U 17 LOCKWOOD DR $769,000 8/28/2006
2705037 Expired
ACT 17 LOCKWOOD DR $749,000 2/6/2007
EXP 17 LOCKWOOD DR $749,000 8/7/2007
2736221 Withdrawn
ACT 17 LOCKWOOD DR $699,000 9/6/2007
PCH 17 LOCKWOOD DR $679,000 12/12/2007
W-C 17 LOCKWOOD DR $679,000 1/9/2008
2816727 Withdrawn
ACT 17 LOCKWOOD DR $659,000 4/24/2008
W-U 17 LOCKWOOD DR $659,000 5/9/2008
2820612 Active
ACT 17 LOCKWOOD DR $659,000 5/20/2008
PCH 17 LOCKWOOD DR $619,000 6/5/2008
How ’bout Duck? He’s gotten unusually bitter. He was kind of nice sometimes, before. It’s rejection. Some people get stronger, some turn into lunatics.
From the AP:
Home foreclosures set record in first quarter
Home foreclosures and late payments set records over the first three months of the year and are expected to keep rising, stark signs of the housing crisis’ mounting damage to homeowners and the economy.
The latest snapshot of the mortgage market, released Thursday, showed that the proportion of mortgages that fell into foreclosure soared to 0.99 percent in the January-through-March period. That surpassed the previous high of 0.83 percent over the last three months in 2007.
The report by the Mortgage Bankers Association also found that more homeowners slipped behind on their monthly payments.
The delinquency rate jumped to 6.35 percent in the first quarter, compared with 5.82 percent for the three months earlier. Payments are considered delinquent if they are 30 or more days past due.
Both the rate of new foreclosures and late payments were the highest on record going back to 1979.
Duck could be the evil character in the Crush Valor comics.
Too bad no writers visit this blog.
pat
fascinating case study
#194 Rich: 659k in Waldwick (original purchase price) is insane!!!
North Arlington FUTURE Comp Killer!
2628099 Sold
SLD 11 CARRIE RD $365,000 9/13/2006
2806850 Active
ACT 11 CARRIE RD $389,000 2/19/2008
PCH 11 CARRIE RD $369,000 4/2/2008
PCH 11 CARRIE RD $349,000 6/5/2008
172 - Yes, they did a reval. Last year the common level ratio was 102%. Doesn’t matter if your home is only 105%. State doesn’t allow you to be over 100%, so if you win your appeal, you get knocked down to true market.
There are, however, plenty of high end homes, that were assessed at significantly below market. If enough of them sell, they could push this year’s ratio delow 100%.
Our home is an unupdated multi-family, in a neighborhood that has lots of renovated single family homes. We were very agressively assessed, overassessed actually. It will be fairly easy for us to appeal successfully. We did it this year and settled. I suspect that we will be able to do it again next year, since I believe we settled a bit too high out of a desire not to have to go to court.
Rich, the takeaway is that FDIC is revising their risk model for larger institutions as we type.
How many foreclosures in NJ and what are the locations. ASAIK, foreclosure in CA, NV, FL, MI & OH does not impact the prices much in NJ.
Frank, as a paid RE professional, my job is to maintain a view that is neither “happy-happy-joy-joy” nor “dim”. My job is to see things the way they are
I think too many realtors® believe that they must be in “happy-happy-smiley-sunshine” mode at all times; as if a positive attitude is what sells houses. I’m not sure why they feel they need to act this way?
Unrealistic and unwarranted optimism is not in the best interest of sellers, who’s equity is slipping away every day their overpriced house doesn’t sell. They aren’t fooling buyers. And, most importantly, they are acting against their own self interest, which is to see a quick correction that gets deals flowing again.
Gap between list and sold is everywhere. Got a listing for a Middlesex condo in the same development where I looked at a place a few months ago. The place I looked at was updated top-to-bottom with a master bath to-die-for and sold late April for $450k. A similar unit in the development sold for $445k last month. This new unit on the market hasn’t been touched since 1985 by my estimate. Same tired carpeting and fixtures as when the current owner moved in decades ago. Asking price… 520k!
When I ask the RE Agent how they justify their ask he tells me “the one that sold for 450 was a special circumstance, the owners had already lined up another purchase out of state and had to move for a job.” So, it doesn’t count as a comp?
Don’t give me cheez whiz and tell me its caciocavallo.
I would not want to be in the $300 jeans business right now
AMBAC MBIA lowered to AA…on credit watch
My pet peeve is $200 dollar flip-flops and people paying to have the chipped nail look.
AMBAC should call AFLAC!!!!
52-Week High
89.33
(06/11/07)
52-Week Low
2.42
(06/05/08)
@76 - GetAClueNJ Says:
D’oh! You just missed us- we had 2 openings, 1 of which was filled 2 weeks ago and the other we just finished second round of interviews last week, 3 really strong candidates- it’ll be hard to choose between them.
:(
Best of luck though to you and bairen and any others out there looking.
CITIGROUP….gone
Washington Mutual…. gone
;)
SAS
#203,
Find out for yourself: http://www.realtytrac.com
AMBAC/MBIA Market Reaction.
Suprisingly US stocks up. Long dated UST bonds price down.
#211,
What do you mean gone? They are still around.
#214 - I think he was making predictions.
“What do you mean gone? They are still around”
I am making a prediction.
If you are trying to buy a house, you will run into sellers that are still using old comps pricing. Since there is so much inventory, you will have a 95% chance of running into the crowd of people that really don’t need to sell. It is amazing how this spreads to even foreclosure situations.
I am trying to deal with an owner that owes $ 650 k on his house. Last year he listed for $ 730 k (still trying to make money, what a joke). He was forced to drop and is now at $ 600 k. Still no takers! And he still doesn’t want to lower it further - that is until of course the bank kicks him out. I think the property will go for $ 450 k.
I conclude that it takes about 20 offers before you finally meet someone that really wants to sell.
sellers are in a “Real state of confusion”.
lol, thats a good one.
SAS
you blokes are forgetting, in all bubbles, price declines are the last thing to happen.
As for the graphs, all the other parameters set to facilitate a major price drop.
i.e increase inventory, units sold at damn near zero, etc..etc…
Many sellers also can’t lower, cause they know they will lose it all, so they hold out, in hope that a greater fool will come along and buy their debt.
SAS
Now this real estate rapper is keeping it real
A Global Threat - Money, Lies And Real Estate Lyrics
filthy, f##king landlords, apartments up for rent cheating, lying, swindling tenants of their every cent paying them for housing, you need somewhere to sleep they’re concerned with nothing but their profit property money, lie and real estate are so easy to conceal who are they gonna answer to they’re taking all we’re worth just scumbags and parasites, they’re renting out the earth
living off your misery and they don’t give a f##k you payed your rent your money’s spent and now you’re f##kng stuck
money, lies and real estate, or whatever they can steal people put their trust in others hoping for the best then they’re getting ripped off by the people who infest this system and society and plague it with their lies conmen in disguise don’t care about conditions, there’s a slum here for a price sign on the line right here because they know you have no choice filthy f##king landlords are just conmen in disguise
conmen in disguise money, lies conmen in disguise
UBS Closing Muni Bond Business, Firing 280 People
http://www.bloomberg.com/apps/news?pid=20601087&sid=at1ChD.avELQ&refer=home
http://www.emailforeclosures.com/
These guys show 808 foreclosures in NJ, most on them in fairly unattractive places.
These guys show 808 foreclosures in NJ, most on them in fairly unattractive places.
I don’t know where they get their data from but for Bergen County they only had 30 listings.
On my site I have over 356 houses currently scheduled for auction in Bergen County. I also tried looking up some of the properties they had listed and didn’t find any foreclosure info for them.
2. The Wall Street to Main Street to Wall Street Echo Effect
A report today by the Mortgage Bankers Association shows the delinquency rate for all outstanding mortgages jumped to 6.3% from 5.82% three months ago. Foreclosures now total 1% of all mortgages, the reports said.
Well, look, on the surface 1% doesn’t sound so bad, and neither does 6.3%. After all, a little more than 93% of all mortgages are not behind or in foreclosure, right? By focusing on foreclosures we’re basically focusing on the tombstones in the cemetery and ignoring the increasingly sick population that may be headed there.
According to Moody’s Economy.com, the number of homeowners with negative equity as of the first quarter of this year was 8.5 million. Now, we’re starting to get to real numbers. Factor in even the most modest estimates of further home price declines and that number with negative equity will continue to expand. Any acceleration puts further pressure on that negative equity number. And even a flat lining of prices will still require years for that equity situation to improve, and that makes the further assumption that those with negative equity don’t capitulate and add to the already bloated inventory of homes.
In short, the bottom line is that just as economists (and former Fed Chairmen) praised the “wealth effect” and its contribution to consumer spending, so too should we expect the negative wealth effect to create a long-lasting drag over the next few years. This is part two of the debt crisis as it spreads from Wall Street to Main Street. Part three is when it echoes back to Wall Street again.
http://www.minyanville.com/articles/fed-lacker-mortgage-continentla-cal-food/index/a/17445
oh… and some from attractive places like this house in upper saddle river.
and this deceptively attractive house in saddle river. check out the comment.
NJ Gator—
You said: “I asked the attorney if the town would be willing to informally discuss a reduction in our assessment, prior to certifying assessments to Essex County in January, so that we could all avoid the expense of litigation for an appeal that we would almost certainly win. Mind you, if they certify our assessment and we later win a reduction from the County Tax Board, the town is on the hook for the overage that we pay to the county and the school board (they don’t refund to the town)in addition to all of their legal fees. The attorney told us that we will have to file with the county.
What a waste.”
Why is this a waste? There needs to be a process for appeals that everyone knows and can follow. You wouldn’t think adhering to the process was a waste if someone else made what is, essentially, a back-room deal. Then you’d call it a crime.
$350 Million in stimulus checks spent in Wal- Mart so far, and the stock amrjet loves it!!
7th cup of coffee today.
I don’t drink coffee.
Rats.
Link to
Appraisal Systems’ current and complete NJ tax revaluations (and ’08 completions)
http://news.yahoo.com/s/nm/20080604/us_nm/usa_housing_philadelphia_dc_2
The city of Philadelphia on Wednesday unveiled a plan to stop people losing their homes through mortgage foreclosure as more borrowers struggle to meet higher payments under adjustable-rate subprime loans.
http://www.tennessean.com/apps/pbcs.dll/article?AID=/20080605/BUSINESS01/806050345
Sale will free capital
New Jersey-based MetLife also will service about $85 billion of mortgage loans as part of the deal, which will generate fee income for MetLife.
http://www.mlive.com/business/index.ssf/2008/06/citizens_bank_announces_stock.html
Wounded Citizens Bank to sell $200M in stock to raise capital
http://www.mlive.com/business/index.ssf/2008/06/citizens_bank_announces_stock.html
Wounded Citizens Bank to sell $200M in stock to raise capital
These guys show 808 foreclosures in NJ, most on them in fairly unattractive places.
I posted earlier today stating that just about everything we’ve seen is in the process of being or is a forclosure and an unusally high amount of vacant houses as well. My price range isn’t even that high yet people refi’d themselves to death.
Senate confirms HUD secretary, charged with fixing slumping housing market, subprime crisis
Preston was an executive at ServiceMaster Co.
http://www.startribune.com/nation/19553959.html
Just wanted to send thanks and endless gratitude to Rich for these charts… We’re looking in BC and heading out to open houses this weekend, and this has helped us steel our resolve to wait until sellers wise up.
I think this will be our rebuttal for when someone says to us “real estate is local” and “the market in BC is strong.”
Thanks again, Rich.
And of course, as always, many thanks to grim for posting the charts. This blog is simply the best.
Pat:
Senate confirms HUD secretary, charged with fixing slumping housing market, subprime crisis
When I read that the first time I missed the comma after secretary.
Not the story I expected :)
Rich,
Terrific charts!
Although I don’t follow Bergen County,
I appreciate your sharing of information.
movinB
I think this will be our rebuttal for when someone says to us “real estate is local” and “the market in BC is strong.”
The rebuttal should be “Wow! You really know how to put lipstick on a pig.”
#240
Pig? Ha… more like roadkill ;)
tom - i did the same
Who knew it mattered?
CNN
Defense Secretary Robert Gates said today he has accepted the resignations of the top Air Force military and civilian leaders. The shake-up comes after a critical report regarding the mistaken transport of nuclear-tipped missiles. A B-52 bomber in 2007 flew from North Dakota to Louisiana with the crew unaware that six nuclear-tipped missiles were on board.
Tom, I personally think the guy that sells Oxyclean on channel 152 would be better at the HUD job than the Servicemaster exec.
But nobody’s asking me.
“If you want to predict a bottom in housing, you first have to predict a bottom in the lending sector. Given that big banks still have billions more in future losses to go, as well as the toxic waste in their Level III assets, derivatives, and the rise in defaults on auto loans, credit card loans and more, it is impossible to predict this. It’d be like hitting a bull’s eye in pitch darkness without ever having seen the target’s location to begin with.
So the next time someone tells you homebuilders have hit a bottom, ask them to explain to you where the mortgages that will allow homebuilders to sell houses will come from. The silence that follows may be a little awkward, but it sure beats listening to a load of nonsense.”
http://seekingalpha.com/article/80256-calling-a-housing-bottom?source=feed
Ahhh, now I get it:
During the first half of Preston’s private sector career, he was a senior vice president and treasurer of First Data Corporation, and an investment banker at Lehman Brothers.
http://www.sba.gov/aboutsba/administrator/index.html
226 Peace - Let me clarify. Each year, a town certifies it’s assessments to the county for the following tax year. It is not uncommon, in other towns, for assessors to make adjustments to assessments prior to the certification. In fact, when I was doing research for our tax appeal last year, several attorneys who specialize in tax appeals suggested that you attempt to have this type of your discussion prior to the certification.
There are two reasons for doing this. One is to save the cost of litigation - for both the taxpayer and the town. The other is to save the town money. As I said previously, if a taxpayer is successful in winning their appeal, the town refunds the entire overpayment to the taxpayer. The school district and county tax levies are separate. The town is responsible for refunding these moneys to the taxpayer. So the town essentially eats that cost. We were looking to save the town money.
Montclair is in a very bad spot assessment-wise. They were forced to revalue at the absolute peak of the market. They are now a sitting duck for successful tax appeals. They are not being proactive about making adjustments to asssessments and a good portion of the town is currently overassessed.
There is nothing unseemly about the assessor sitting down with a taxpayer prior to the cerrtification, reviewing reasonable comps presented by the taxpayer and making adjustments that they believe are fair in their professional opinion. Of course, if the assessor felt the current assessment was fair, they should certify the current value and then the taxpayer could file a formal appeal if they still felt they were overassessed.
Looking at our own home as an example, we feel like we might be at least $50-60k overassessed based on the current market conditions. In a high tax town like Montclair, that translates to about $1200. Since 75% of our taxes go to the county and the school, we were looking to give Montclair the opportunity to save about $900 plus attorneys fees by meeting with us beforehand. Since they do not want to avail themselves of the option, we will file the formal appeal and then most likely settle with them before the hearing date. They will now be on the hook for all that money if we settle- that’s what I think is a waste. As a taxpayer in town, it saddens me that this money is going to be wasted many times over for all the other successful appeals that will be filed/settled. This contributes to my obscenely high tax bill.
226 - Also one more thing. In Montclair, all reductions to assessments require governing body approval (i.e. town council). Even our state tax court settlement offer required this approval before we could submit our stipulation to the court. We couldn’t enter into any backroom deal with the assessor, as the assessor would need to get the council to approve the reduction in a public hearing.
#248,
I tried this, and was told too bad, file an appeal.
more mortgages will be originated when house prices drop. it is all about prices being too high. the downpayments of 1st time buyers which were at a median of 3% recently will be higher as a percent when prices are lower. buyers debt to income ratios will be lower as well. nodoby wants to face the fact that housing is still massively overvalued and that this is the source of all the calamity
250 Frank - We definitely will be. I have dealt quite extensively over the past few months with the town’s counsel. The sad thing is, they were quite willing to settle with us before the actual hearing. If they would just move the settlement discussions up a few months, it would save them a lot of money. Since they don’t care about that, we will litigate. I guess it’s true that no one in government cares about saving money. Sigh…
From MarketWatch:
Fitch downgrades MGIC Investment, PMI ratings
Fitch Ratings on Thursday downgraded MGIC Investment Corp. and PMI Group, noting it has become much more pessimistic on its outlook for the mortgage insurance sector. Fitch lowered Mortgage Guaranty Insurance Corp.’s insurer financial strength to A+ from AA and MGIC Investment’s long-term issuer rating to BBB+ from A. The ratings will remain on rating watch negative, indicating that further downgrades may be in the offing. Fitch also cut PMI Mortgage Insurance’s rating to A+ from AA and PMI Group’s long-term issuer rating to BBB+ from A. The outlook on PMI and PMI Mortgage Insurance is negative.
181.skep-tic Says:
June 5th, 2008 at 1:10 pm
if more white people saved their money and worked their *sses off like immigrants, we would collectively be in much better shape right now.
Starting point for me was four years in the military, curtesy of the Draft. Put a mandatory Draft back and start them all on the road to working and saving.
NJGator—I’m sorry if I didn’t quite understand what your situation was. In my town, there’s kind of a broad pre-appeal meeting, which sounds more like what you’re talking about. Anyone who wants to appeal goes to scheduled meeting with assessor and township attorney. At that meeting, the assessment can be lowered. If it isn’t lowered then, or lowered enough, one moves on to the tax court hearing. (In my case, I knew I was doomed because the land part of the assessment was huge…and when they pulled up a photo of the house, everyone said: “How charming.”)
Good luck.
Peace - We had an informal pre-appeal hearing with our reval company the year Montclair revalued. They gave us a token $21,000 reduction then (there were undisputable errors they made on our property record card). When we pursued a formal appeal, we won an additional $40,000 reduction.
Unfortunately for our town, the real estate market continues to decline. People who did not have a valid appeal last year may infact have one this year. It is an unfortunate circumstance of timing for our town.
The same thing happened to them after they last revalued in 1989. About half the town pursued appeals successfully. Those who didn’t appeal when they should have, wound up paying artificially high taxes for years until the next revaluation.
If your town operates that way outside of a revaluation year, it sounds like they handle these things responsibly. I wouldn’t have your problem though, because our home is currently distinctly lacking in curb appeal!
#njpatient Says:
tom - i did the same
Maybe just wishful thinking on both our parts that someone’s feet are going to be put to the fire?
#Pat Says:
Tom, I personally think the guy that sells Oxyclean on channel 152 would be better at the HUD job than the Servicemaster exec.
You made me envision the most bizarre infomercial.
Stupid Web 2.0 crap gets on my nerves. A third party site doesn’t respond in time and no maps :( I think I got that fixed now.
Cirrus (35)
I’m in structurd finance and tried my darndest to get out of NYC. Kept getting pulled back.funny that I thot of P-town as suburbia, while you are moving furthur west.brag of luck out there.
Dear Sellers,
Did you see the disconnect between the list price and sold price? Does that tell you something? 23 years of history and there’s never been a disconnect except for now. Do I need to explain this?
But hey, you’re not gonna give it away, right? You need a certain amount to trade up or downsize and have a nice cushion, right? You paid a lot for that kitchen renovation and you deserve the return on that investment, right? There. You told them!
In fact, all of us here on this blog will sit and sit for as long as it takes for you to get your money. You’ll show them, right?!!
Tick… tick… tick… tick…
oh my
don’t know how some people stay in business…
njpatient,
You’ll be at the GTG, yes? We’ll do a few shots and act like a bunch of NARs.
Pretorius - are you still around? Quick question, if I may - what do you think will happen with bonuses on the Street this year?
I would be very surprised to see them come out at any more than 50% of last year’s.
We’ve got an ugly spring selling season already (see Rich’s numbers today, and Grim’s GSMLS numbers all spring) in terms of inventory/sales velocity, and that’s despite the fact that, as you have taken pains to point out, folks in this area have RECORD bonuses in their pockets this year.
If folks are sitting on their wallets now, how bad will it be next spring?
When the bonuses don’t come, and next March the spring sales don’t come, is when I believe that gary’s “Tick… tick… tick… tick…” will go BOOM.
BLOODBATH IN SPRING 2009
BOOOOOYAA!!!!!!!!
“You’ll be at the GTG, yes?”
Not sure yet. May have to give Mrs. Patient a day off and take the Little Patients for an early dinner. Wouldn’t be able to behave like quite such a nar.
Dear Realtors,
In case you missed the data presented today… this is what happens when you get a few people together with superior intelligence and advanced education. No talking points here, just pure meat and potatos. And this is just a side gig. Can you imagine what these guys are like when they’re serious?
Anyone have dirt?
From Reuters:
Subprime lender Accredited consolidates operations
Accredited Home Lenders, a subprime residential lender trying to recover from the U.S. mortgage crisis, this week consolidated operations centers to its San Diego headquarters, sources said on Thursday.
The company fired workers and closed offices in Orange, California, Beaverton, Oregon, St. Petersburg, Florida, and Woodcliff Lake, New Jersey, one source said. Accredited was purchased by private equity firm Lone Star Funds in October.
“I can confirm that today Accredited Home Lenders Inc. informed our employees of a restructure of our work force,” Ed Trissel, an Accredited spokesman, said in an e-mail. “The restructure was done in order to maintain Accredited’s financial position in the marketplace and improve the company’s long-term prospects by realizing efficiencies.”
“Can you imagine what these guys are like when they’re serious?”
Yeah - I’m all twitchy from the coffee and lack of sleep and my stomachache is fortunately distracting me from my headache and I haven’t showered since Monday.
So are house prices now priced like other goods in our market? Where there is an artificially high price and as American consumers, we all want it for “wholesale”? Will this pattern stick, where everyone gets a “deal”?
sounds like the sign on the chinese restaurant up on Broadway and 113th or so: “Sushi, half price every day.”
213 hard
“Suprisingly US stocks up. ”
You’re welcome.
a thought:
for folks looking for jobs in nyc… you might want to check out http://about.bloomberg.com/careers/index.html
i expect it would be political suicide for the mayor if his business should let anyone go… so you’d at least be safe until his term expires.
Quick question, if I may - what do you think will happen with bonuses on the Street this year?
This wasn’t directed to me and I don’t have the qualifications to answer so here I go :)
Bonuses are going to be strong. At least as strong as last year if not stronger. Because when the top execs get big bonuses it means everything is going great.
Because if they didn’t give themselves big bonuses it would imply that things weren’t going so well. And if things aren’t going well, someone has to be accountable, and there’s only so many people you can lay off before people start asking questions.
271 Tom
I’d buy that, but they’re missing something crucial.
Cash.
Wall St. Bonuses will be good for those that don’t get laid off.
Alot more layoffs to come.
SAS
274.
Grim,
you have said before that you expected a quicker market response to the housing market fundamentals bottoming out.
Well i had an epiphany on that point today (and perhaps this is obvious to many).
the rate of information dissemination among humans has grown exponentially in the last several decades (in direct relation to moores law), but humans as a whole have not matched their information asimilation rate to the information dissemination rate ( i.e humans cannot process and develop rational thoughts around information at the rate at which is is now supplied).
It appears that the overall rate of information asimilation (and hence action, i.e realizing that the housing market is dead)is determined by the truly average individuals ability to asimilate information. By average i do not mean the popular concept, but the individual of “mean” capacity for logic..
Once again the housing bubble burst is a prime example. The average joe has access to more information then they could ever process, such as real estate blogs, government statistics, google etc. Instead of attempting to process even a moderate portion of the information available to them in a manner that is relevant to them they turn on Faux News, or American idol.
My point is that while there will always be the james bednars of the world, they are the exception and utilize information orders of magnitude more effectively then joe 6pack. This means that regardless of how fast information can be processed or how much may be available the rate at which human dependent processes (at a society level, not the individual level)will develop/ evolve is the rate at which joe 6pack processes new information (a very slow rate compared to the JB’s of the world).
Events that have been unknowingly (to joe 6pack anyway) set in motion (housing prices only go up) can forcefully accelerate the acceptance of information by joe 6pack but it does not accelerate it as they does such as how people are now being forced to understand/acknowledge the housing collapse
SO whats my point? Humans effect as the limiting factor in an information based society becomes even more apparent and more defined as the quantity and rate of information we have access to increases.
My second point is that i believe we really are seeing the stratification of human society into those who can/try to process the increasing rate of information and then those who wait for Faux news and act as limiting factors. While there is certain to be an income factor in any such stratification, it is only 1 factor. to use an extreme example , may i suggest you look at britney spears or paris hilton. Lots of money, not so much brain power.
//Geek off//
I had a commercial RE agent canvassing my ind. park stop in my office to drop off flyers on props he represents.
We talked for about 10 minutes and at one point, he stopped me and said “I wish I could record this conversation. So many people I work with don’t understand exactly what you just said. And you don’t work in real estate!”
I was basically discussing how I feel RE agents should charge residential sellers a small fee to list their house ($500.00?) because so many sellers are unrealistic in their ideas of pricing. If they are going to waste the time and resources of someone by listing at an artificially high price and then not accept a realistic lower price (5-10% lower?), then why bother listing at all? Is is sadistic?
Anyway, my point is that this blog has educated me and for that, I say thanks, Grim!.
THAT REAL ESTATE IS NO LONGER “SEAGULLS ON A FRENCH FRY.”
O.K., Kettle, what have you been drinking?
Pat
sleeping 3 hours . nght for the last week to get projets done and clean up other peoples mess.
While a little out there i still think the general idea is accurate and interesting
been at work since 7 may go home early tonight at about 1am….. oh well at least i get paid by the hour! the wonderful world of consulting!
7am that is.
apparently i cannot hang with NJ patients schedule….. Hey patient, does the significant amount of money make the schedule easier?
(meant only in the friendliest manner NJP)
I wasn’t talking about your convoluted method of describing learning curve theory.
But I love Ah-Hah moments.
Sometimes the most satisfying discoveries are at the point of exhaustion…when my teeth hurt.
But at my age, the problem is remembering what I figured out ten minutes later.
pat,
my typing was a little off :( but completely sober, i promise
;)
Rich-
Belated thanks for all the work you put into this. Great charts.
I’ll chip into buying some billboards to put this up in BC. Maybe we could make it digital and update it each month?
JM
Pat,
that was an unfiltered Kettle1 brain dump. Although i did cut it a little short.
be afraid, very afraid…… i might blow a fuse :)
Spam spam: the RE agents are into it; they love overpricing because it ties the seller to them. Then they list the property and suprise… they get no offers. After a while they start pressing the seller into price reduction. It’s the old bate and switch: overprice - get the client - pressure the client to lower the price.
RE agents should not even accept listings that are overpriced, but they do… the listing fee is worth the gamble.
It’s the old bate and switch: overprice - get the client - pressure the client to lower the price.
In the industry, this is referred to as “buying the listing”.
Pat,
But at my age, the problem is remembering what I figured out ten minutes later.
Age and an 11 month old will do that to you. I have both going against me right now.
We’ll have to have a far west GTG just for you.
Kung Fu Panda’s at the Drive-In in Vineland this weekend.
A hundred degrees.
You NNJers don’t know what you’re missing.
njpat - You’re welcome.
You plan on personally bailing the banks in the next round of capital raising?
Richinnnj
i was working yesterday (hey gas for MY carbon footprint doesn’t come cheap)and didn’t see the charts until today. Awesome. Oh and i love that Bergen Foreclosure site..one of my good friends lives behind one of the foreclosing houses and it’s funny cuz she always complains that the owners never fix up their house…I’ll let her know why…
re:236 MOVINB
Looking in B/C this weekend? Maybe I’ll see you in my neighborhood as we have A LOT of houses for sale in our little piece of paradise here in B/C…have fun and stay cool..one thing for sure is that you’ll know which homes have decent A/C…LOL
RE:286/287…buying the listing…
Ok this I don’t get..the R/E buys the listing, it’s too high to actually sell..then when the house doesn’t sell that same R/E becomes the problem…”he’s not working hard enough”…”he/she just wants our $”…”ANOTHER agent could sell the house better, give it more attention” etc…it seems to me that buying the listing is just taking on the emotional issues of the homeowners…now when that listing expires and the home owner now hates that original agent, then the second agent swoops in, lists lower cuz now the owners are frustrated and BAM…that second R/E gets the sale …he’s the hero…sometimes it’s better to be second…
Laurie: the second agent will have the same strategy: s(he) will state “I can sell this for $ x”. It’s the same bait and switch. This is why there is a long-term exclusiveness (6 to 9 months) in the contract; the seller cannot switch in between.
Ask a RE agent: why not limit the contract to 3 months if s(he) really thinks that the property will sell for asking within 3 months?
Why is the fee not dependent on listing time and price? If I were a seller, I would pay my agent 1% bonus if they get my asking price. I would reduce the fee 1% if he gets only 90% asking price. Likewise, I would offer a 1% bonus if he sells it within 3 months and take away 1% of the fee if it sells after months.
The standard 2.5 + 2.5 % fee is rigged, monopolistic behavior that should be challenged in court. Fee should depend on the service delivered. If the agent sells below 95% asking price or after 6 months, there is basically poor service delivered to the seller.
PS to the previous comment:
why can you not have two agents selling the property?? The agent that sells first gets paid, the other agent just has to swallow the cost; that should make the agent more realistic in pricing and time-to-sell
The standard 2.5 + 2.5 % fee is rigged, monopolistic behavior that should be challenged in court. Fee should depend on the service delivered. If the agent sells below 95% asking price or after 6 months, there is basically poor service delivered to the seller.
If an agent cannot gauge market value accurately, it is HIS PROBLEM (and the homeowner’s problem), not an indication of a ‘rigged industry.’ Please remember realtors are all INDEPENDENT CONTRACTORS, running their own businesses. If a realtor cannot convince the homeowner to list the house at a reasonable (or below reasonable) price, he’s a crappy salesperson and should get a job elsewhere.
*****************
BTW, Chicken Little, (my resonating message)
Be what your blog entries are, the sky isn’t falling. The best homes priced competitively and exceeding in presentation value are not only selling, but drawing multiple offers. The POS’s sit. Your “Comp Killers” are overpriced POS that were purchased in the boom, way too high, and remarketed within too soon a window. Viola, comp killer. Big f*ck*ing deal, who could NOT have seen that coming?
Keep renting. By the time your followers reenter the market, mortgage rate will have risen and they’ll be priced out again. Wah.
BTW, I have no idea what ramen noodles taste or look like nor will I ever.
muah