“New Jerseyans need homes they can afford”

From the AP:

Housing reform on tap in NJ

The Assembly will consider a sweeping plan Monday to revamp New Jersey’s affordable housing laws.

Supporters contend the bill would increase affordable housing throughout the state but critics argue it would push housing into suburban communities fighting overdevelopment.

“The Legislature can no longer take an ostrich-like view of the state’s housing policy,” said Assembly Speaker Joseph Roberts Jr., D-Camden, a bill sponsor. “New Jerseyans need homes they can afford and jobs they can reach.”

New Jersey is the only state with a constitutional requirement to create affordable housing, but critics contend that has failed. The bill under consideration would overhaul state low-cost housing laws for the first time in more than two decades.

Census data shows New Jersey is the second most expensive state for homeowners and the fourth for renters, despite a 1975 state Supreme Court ruling forcing all municipalities to provide housing for low- and moderate-income residents.

The measure under consideration would:

• Bar suburban towns from paying cities to take their affordable housing requirements. The agreements have been hailed as providing housing money to poor cities, but blasted as failing to promote affordable suburban housing.

• Create a fee on commercial development, which would raise up to $120 million to help bring 115,000 new affordable homes by 2018.

• Require 20 percent of housing in developments that get state funding be set aside as affordable.

• Allow municipalities in the Highlands, Pinelands, Meadowlands, Fort Monmouth and Atlantic City regions to jointly provide affordable housing around job and transportation centers.

• Permit developers to compete for tax credits to help build affordable housing.

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205 Responses to “New Jerseyans need homes they can afford”

  1. grim says:

    From the Journal News:

    Slower times for home improvement

    Homeowners typically shop at Beckerle Lumber during the late spring for materials to build or replace outdoor decks. Costs of these deck projects can range from $4,000 to $20,000. Yet this year, that business has been slower than expected at Beckerle Lumber’s four home improvement stores in Rockland County.

    The economy was on the mind of Shelby Greene Zarlin during a stop at Best Plumbing Tile & Stone in Scarsdale last week. As the New City resident shopped for bathroom and kitchen fixtures for a daughter’s home in New Jersey, Zarlin said economic uncertainties were one reason that she was watching the budget carefully.

    “For two years, this economy has been going downhill,” Zarlin said. “You worry that $5 does not buy you a gallon of gas and a dozen eggs today. You worry that the oil market is being manipulated like you can’t believe. You worry that we are the laughingstock of the world in this country.”

    “This industry is a train wreck,” said Davidowitz, who is based in New York City. “It is the worst segment in retailing. That’s not surprising since the housing market is going through its worst crisis since the Great Depression.”

  2. grim says:

    From the WSJ:

    Bear Stearns Hedge Fund Managers
    May Face Indictments
    June 16, 2008; Page A1

    Federal prosecutors, capping a yearlong investigation, are preparing to file criminal charges against managers of two Bear Stearns Cos. hedge funds whose collapse helped mark the start of the credit crisis.

    The U.S. Attorney’s office in Brooklyn is slated to complete interviews of witnesses and other key people in the case this week, and has indicated to lawyers with interest in the case that indictments could be imminent, according to people familiar with the matter.

    The former Bear Stearns managers, Ralph Cioffi and Matthew Tannin, managed two high-profile bond portfolios for the securities firm’s asset-management unit. They could be charged with securities fraud within the next week, says one of the people familiar with the matter, though evidence could emerge that would change that.

    At issue is whether the managers intentionally misled investors by presenting a rosy picture of the funds at a time when they were privately communicating with colleagues about their worries over how the investment vehicles would ride out weakness in the mortgage market. Any indictments would be the first criminal charges against Wall Street executives arising from the credit crisis that swept the financial world last year.

  3. grim says:

    From the NY Times:

    Nearly Half of Wall St. Bank Profits Are Gone

    Only a year ago, Wall Street reveled in an era of superlatives: record deals, record profit, record pay. But a mere 12 months later, nearly half of the profits that major banks reaped during that age of riches have vanished.

    The numbers are staggering. Between early 2004 and mid-2007, a period of unprecedented wealth on Wall Street, seven of the nation’s largest financial companies earned a combined $254 billion in profits.

    But since last July, those same banks — Bank of America, Citigroup, JPMorgan Chase, Lehman Brothers, Merrill Lynch, Goldman Sachs and Morgan Stanley — have written down the value of the assets they hold by $107.2 billion, gutting their earnings and share prices. Worldwide, the reckoning totals $380 billion, much of which reflects a plunge in the value of tricky mortgage investments.

    More downbeat news is expected this week, when several big banks, including the ailing Lehman Brothers, are scheduled to report results for the latest quarter. As the tally of losses keeps growing, many bank executives — and their shareholders — keep asking the same question: When will the pain end?

  4. grim says:

    From Bloomberg:

    European Inflation Accelerates to Highest in 16 Years

    European inflation accelerated to the highest in 16 years last month as food and energy costs soared, intensifying what finance ministers from the world’s richest nations said is becoming a “more complicated” dilemma.

    The inflation rate in the euro area rose to 3.7 percent, the highest since June 1992, from 3.3 percent in April, the European Union’s statistics office in Luxembourg said today. The rate for May is higher than the 3.6 percent estimate published on May 30.

    Soaring commodity prices have pushed up costs for companies and consumers and at the same time are posing a “serious challenge” to economic growth, officials from the Group of Eight nations said yesterday after a meeting in Japan. European Central Bank President Jean-Claude Trichet this month said the ECB may raise its benchmark interest rate a quarter point in July, signaling he is setting aside concerns about the economy’s expansion to combat inflation.

    “With policy makers adamant on keeping a lid on inflation expectations, these more-difficult choices mean economic growth will face significant headwinds in the short term,” said Deirdre Ryan, an economist at Goodbody Stockbrokers in Dublin. Growth will “struggle to make any meaningful gains without the aid of an easing monetary policy.”

  5. NJGator says:

    NJP 170 Previous Thread – Little Stu/Gator would definitely be up for meeting other like minded future bubble bloggers at the Turtle Back Zoo. He was a little lonely at The Brass Rail. Although he did have a very fun and eventful evening. Our little guy, who calls bagels “spicy”, decided he liked fried octopus (he ate 8 of them!) and we took a very exciting tour of the Hoboken Terminal. He saw 2 trains arriving and 3 trains leaving the station. He was so excited about that that on the walk back to The Brass Rail he said “Mommy, I made a poopy at Hoboken Station”.

  6. R Patrick says:

    Really, define affordable.

    Maybe I am wrong and I leave it to the people who have seen more of this world than I have. But in my previous job I saw really only 3 strata in NNJ.

    The poor, who get housing assistance, food stamps, ect.

    The struggling working/middle class. Who pay lots of taxes but get little to no services.

    Rich people.

    It seems a disincentive to go from group A to B based on what I heard from former co-workers. And I know I ran back for my masters to try and get closer to group C.

  7. grim says:

    From the NY Times:

    Ed McMahon’s 90210 Mortgage Crisis

    WITH sweeping canyon views, gated access and nearby homes owned by the likes of Britney Spears, Ed McMahon’s house above Beverly Hills looks like the symbol of a life well paid.

    That is why it came as a shock when Mr. McMahon, best known as Johnny Carson’s sidekick, confirmed this month that he was facing foreclosure.

    He quickly became a national symbol of an overspent borrower struggling with the mortgage crisis. But Mr. McMahon had an advantage over the average homeowner: he could go on “Larry King Live” to talk about his plight.

    “If you know where the money is, would you let me know?” Mr. McMahon joked during an interview in the six-bedroom, five-bathroom Mediterranean-style mansion he and his wife, Pamela, have called home for nearly 20 years.

    In his case, he added more seriously, the troubles were not about a subprime loan or ballooning adjustable rate mortgage, but simple overspending. “I made a lot of money, but you also can spend a lot of money,” he said.

  8. grim says:

    From Reuters:

    Renters, soldiers feeling foreclosure pain

    The day before her husband was deployed to the Middle East by the U.S. Air Force, Marketa Johnson got word that her family would be evicted from their rented home.

    It did not matter that the Johnsons had never missed a rent payment and had signed a two-year lease. The property owner was facing foreclosure and so Johnson simply packed her bags.

    But last month, when she got another eviction notice and was ordered to leave her new home, she decided to fight.

    “We military are good tenants,” said Johnson whose husband, Derrick, is an Air Force pilot. “We always take care of the property. We were never late, never. I don’t see a reason that we should not stay there.”

    The U.S. housing crisis that has caused a spike in foreclosures has meant not only anguish for delinquent mortgage borrowers but heartache for renters in good standing.

  9. Pat says:

    “There was a gross underestimation of the true cost of homeownership,” Connelly said.


  10. Tom says:

    Maybe realtors really didn’t know the housing market wasn’t going to keep doubling every few years.

    This Teaneck foreclosure seems to belong to a realtor.

  11. grim says:

    News Flash: Westfield TeePee Sales Plummet!

    From the Star Ledger:


    Bill and Natalie Ward had six-foot-tall teepees, bibs with stitched-in bottle holders and princess wands for sale during a recent crafts fair in Westfield.

    What they didn’t have were customers.

    With no patrons to tend to, Natalie Ward lounged in her chair, reading a magazine. For a chunk of the afternoon, the only potential customer was a little girl from the adjacent stand, curiously touching the wands. The Hamilton couple closed up shop early.

    “The way we do business, people are thinking, ‘Yeah, we really don’t need that,'” said Bill Ward, whose teepees sell for $88 or $92, depending on color. “They’re still buying, but not buying big items.”

    The Wards — and many other vendors at the daylong fair — were emblematic of the craft industry, which is being pummeled by an uncertain economy.

    “Maybe people are just not interested, but we’re finding that misery loves company,” said Deann Verdier, whose company Sugarloaf Craft Festival runs shows in New Jersey, Delaware, Pennsylvania, Connecticut, Maryland, Georgia and Michigan. “Boat shows, home shows, everybody is suffering.”

    “The word on the street is shows are going to shut because they’re not doing well,” said Jim Burnet, owner of Burnet Enterprises LLC, which promotes a biannual craft show in Chester. A 160-vendor show on May 31 and June 1 attracted about 10,000 people.

  12. Pat says:

    WP is really pounding in the problem around DC, and seems to have re-educated the citizenry, based on the folks we talked to over the weekend down there.

  13. SG says:

    Pretty long article, but good read.

    In U.S., Wave Of Easy Money Reveals Rough Consequences

    Chapter III

    ‘Half-Truths’ and Lies

    The young woman who walked into Pinnacle’s Vienna, Virginia, office in 2004 said her boyfriend wanted to buy a house near Annapolis. He hoped to get a special kind of loan for which he didn’t have to report his income, assets or employment. Mortgage broker Connelly handed the woman a pile of paperwork.

    On the day of the settlement, she arrived alone. Her boyfriend was on a business trip, she said, but she had his power of attorney. Informed that for this kind of loan he would have to sign in person, she broke into tears: Her boyfriend actually had been serving a jail term.

    Not a problem. Almost anyone could borrow hundreds of thousands of dollars for a house in those wild days. Connelly agreed to send the paperwork to the courthouse where the boyfriend had a hearing. As it happened, he was freed that day. Still, said Connelly, “that was one of mine that goes down in the annals of the strange.”

  14. grim says:

    From the AP:

    Budget worries on tap

    While legislators and Gov. Jon S. Corzine hope to reach a deal on a new state budget, the Assembly on Monday will move to avoid a tax increase on employers — at least for now.

    Corzine’s $32.8 billion spending plan would include $2.9 billion in spending cuts amid fiscal woes.

    Lawmakers, though, hope to restore funding that would stop proposed aid cuts for municipalities, hospitals, nursing homes and college tuition assistance. They also want to eliminate proposed Medicaid co-payments and a $100,000 income limit on a county college scholarship program.

    They’re also looking to revamp Corzine’s plan to cut government by offering retirement incentives to state workers, a move many fear would boost long-term retirement benefit costs. The governor’s plan would be reduced to 2,000 workers, with the minimum age eligibility raised from 50 to 58.

  15. DL says:

    Cognitave dissonance. State government will pass a law mandating “affordable housing” in communities where economics (RE market, property taxes, cost of living) have made housing unaffordable.

  16. Cirrus says:

    Former roomate of mine and Mrs. Cirrus was looking to move from So. Brunsick to Lambertville. He described “the nicest 1 bedroom with loft in a carriage house.” When he called the landlord to inquire that he and his fiancee were interested in renting. He said she went into this whole song and dance about paying rent on time, etc. We’ve known the guy for about 8 years and lived with him for 2, known his fiancee for about 4. They both have had the same, stable and very well paying jobs, so to him, at this point he must’ve been trying not to laugh to hard to assure the landlady that they’re good for the $1600 /mo rent. Then the bombshell: “This is a low-income apartment, you can only have a maximum income of $50k /yr.”

    If I had to guess, each are well north of $80k so their obviously SOL, but in his words this brings up the biggest question: why on earth is one of the nicest small aprtments in Lambertville low-income housing with a $50k max income requirement with $1600 rent?!?!?

  17. Cirrus says:

    d’oh- missed a ‘too’ and a ‘they’re’ – sucks typing on a phone!

    also, it appears grim has some robot friends joining us this morning.

    I, for one, welcome our new overlords…

  18. BC Bob says:

    Pat [9],

    From the article you posted. Classic.

    “Nobody had models for that,” said David E. Zimmer, then one of the executives at People’s Choice, a subprime lender based in Irvine. “Nobody had predicted people going into default in their first three mortgage payments.”

  19. BC Bob says:


    It was Investor David that I was asking about on Sat.. I had a Bergabe brain cramp and could not remember his name.

  20. Clotpoll says:

    grim (3)-

    “But a mere 12 months later, nearly half of the profits that major banks reaped during that age of riches have vanished.”

    Yeah, but the commissions and bonuses have been pocketed…and none of the players are giving them back.

  21. Tom says:

    “Nobody had models for that,” said David E. Zimmer, then one of the executives at People’s Choice, a subprime lender based in Irvine. “Nobody had predicted people going into default in their first three mortgage payments.”

    Yeah. lets give borrowers 150% of what we would normally give them in the previous 20 years. Let’s also not check their income or credit too closely so we don’t have to deny as many applications. That way we’ll make a killing. Hey, why should they have to prove they can save money? Get rid of that down payment.

    And nobody saw this coming? Brilliant work guys!

  22. BC Bob says:

    “Yeah, but the commissions and bonuses have been pocketed…and none of the players are giving them back.”


    A big % of the bonus $ was RSU’s. That’s why the Merrill trader decided to sprinkle his do do all over the joint.

  23. Tom says:

    “Yeah, but the commissions and bonuses have been pocketed…and none of the players are giving them back.”

    Too bad shareholders can’t get them to pay back. Then again, too bad shareholders didn’t speak up earlier. There were a lot of people that could have done something, from the lenders to fannie mae, hud or the gov’t organizations that oversee housing and bankers.

    Only way to get money back from them is to find a way to prosecute.

    Unfortunately, if the lenders fail too quickly, the results could be even worse. But I still think it should be the people who profited from this whole thing that should save the banks. Not the tax payers that will probably foot the bill.

  24. kettle1 says:

    G’mornin All!

    I am very disappointed that i couldn’t make the GTG, the last one in Morristown was fun! maybe next time :(

    On a housing note…. I continue to be amazed at people who can still look at the current markets and not see the real situation. A friend (who was once a Realtor tm) was complaining over the weekend about how they cannot move to take a job they were offered in another state because they would lose too much money with the market being down (they bought in 04, not in NJ). But they figure that in about 2 years, 5 at the most, the market will be back up and they will be able to at least break even, because they need the money to retire!
    I politely disagreed and suggested they look at some of the charts that show the extent of the current bubble . They pretty much said that i didnt know what i was talking about, this bubble isnt nearly as bad as the 90’s bubble.

    My point is that i am still seeing fairly intelligent (although they Faux News fans) people who despite the bursting bubble being in t heir face, continue to suggest that we are just seeing a minor correction and all will be 2005 prices and higher in 2 – 5 years!!!! I am ready to pull my hair out. It one thing when its someone you dont know or care about, but when friends and family continue to parrot all this NAR crap it drives me insane!

  25. BC Bob says:


    Did you find me that silo?

    13 year lows in stocks, unprecedented world demand and a hideous ethanol program. Yet, it’s the speculators who are the scapegoats for high prices.

    “June 16 (Bloomberg) — Corn climbed to a record near $8 a bushel as storms pounded crops in the U.S., the largest producer and exporter, and caused what may be the worst flooding in the Midwest since 1993.”

    “Corn rose as much as 3.5 percent, and soybeans, wheat and rice all gained. The flooding in the Midwest will probably cause “hundreds of millions of dollars” of damage, according to the National Weather Service. U.S. corn stockpiles may fall 53 percent to a 13-year low before next year’s harvest, the U.S. Department of Agriculture said June 10.”


  26. njrebear says:

    Honda rolls out new zero-emission, hydrogen fuel cell car for southern California

  27. Tom says:

    “They pretty much said that i didnt know what i was talking about, this bubble isnt nearly as bad as the 90’s bubble.”

    I recently had a seemingly intelligent person told me they actually found WMD’s in Iraq but the liberal media wouldn’t report it.

    People believe what they want to believe.

  28. kettle1 says:

    expect reports of large scale food shortages sometime around fall 08 winter 09. Several world markets were counting on a bumper US corn crop to supply their demands. The current flooding in the midwest means that the farmers will be lucky to even come close to projected production much less exceed it.
    Without the expected bumper crop there are going to be sky rocketing food prices in some places that end up with price controls, food lines and starvation

    Oh and here is some more food for thought… For those advocating that the US shift any significant portion of its fuel demand to corn ethanol; This single flooding event in the midwest or a similar event could be enough to cause a national fuel shortage if corn ethanol was a substantial US fuel source

  29. Secondary Market says:

    #24, I deal with that all the time and the biggest struggle I have is the tip toe dance to avoid confrontation. I capitulate because I have nothing to loose but their argument is usually fueled on the emotional/financial tie to their argument.

  30. frank says:

    Westfield is getting hit hard by foreclosures. Foreclosure tour anyone?


  31. DL says:


    Then: You have to buy NOW because prices are only going to go up.
    Now: You have to buy NOW because interest rates are only going to go up.

  32. baghdad bob says:

    #14 kettle1

    Ask them even if they are right on prices (which I doubt) what are 2 to 5 years of their life worth to them? Show them what percent of their expected life span they have left is represented by that 5 year time fram. maybe it will change heir tune.

    For example if you are 40 you probably have 40 or so years left. 5 years represnts 12% of your remaining life span. What’s more valuable to you? Taking a 50k hit on a house, or freeing up 12% of your remaining life span to pursue new opportunities? Especially if those 5 years are still relatively prime years.

  33. Clotpoll says:

    BC (25)-

    Limit up…and it’s all your damn fault. Woke up this AM, turned on the TV and saw mile after mile of flooded Iowa cornfield. Of course, 30% of what little corn crop we’ll have this year will be turned into fuel.

    Stupid is as stupid does.

  34. grim says:

    From MarketWatch:

    Lehman posts first loss as public company

    Lehman Bros. Holdings Inc. said write-downs on soured debt securities and bad trading results led to a fiscal second quarter loss of $2.8 billion, or $5.14 a share, the Wall Street firm’s first quarterly deficit since it went public in 1994. In the year -ago quarter, the company earned $1.3 billion, or $2.21 a share a year ago. The loss was expected, and the company pre-announced results last week, a tumultuous one for the firm that saw it raise $6 billion in new capital and fire two of its top executives amid a crisis of confidence among some investors.

  35. Clotpoll says:

    vodka (28)-

    God forbid we import all the cellulose ethanol we need from Brazil.

    Why would we want to do that? It’s cheaper, won’t cause famine and won’t roil commodity markets.

    That’s no fun at all.

  36. Stu says:

    Then: You have to buy NOW because prices are only going to go up.
    Now: You have to buy NOW because interest rates are only going to go up.

    Tomorrow: My gig is up!

  37. Clotpoll says:

    Stu (36)-

    Day after tomorrow: want fries with that?

  38. Everything's 'boken says:

    re wmd
    They did find a few old gas shells if I recall corretly. Some use to justify that claim.

  39. grim says:

    From MarketWatch:

    U.S. June Empire State index falls to -8.7 vs. -3.2 in May

    Manufacturing activity in the New York area eroded further in June, the New York Federal Reserve Bank said Monday. The bank’s Empire State Manufacturing index fell to -8.7 in June from -3.2 in May. The index has in negative territory in four out of the last five months. The subindexes for new orders, shipments, and unfilled orders were negative and below their May levels. The prices-paid index declined slightly but was still near last month’s record high. A separate survey found that many manufacturers plan to restrain their capital spending going forward.

  40. Tom says:

    Forget about corn as fuel.

    Apparently scientists are coming out with microbes that crap an oil substitute out.

    Vinod Khosla is one of the backers. He was one of the co founders of sun microsystems and one of the early investors in google.

  41. John says:

    Hope all your baby daddies out their had a kicking father day.

  42. John says:



  43. BC Bob says:

    Another realtor blasting the NAR. Not a new position for him.

    “1 – The Country’s Biggest Liar – NAR’s chief economist, Lawrence Yun, is making his predecessor David Lereah (Liar) look like a wimp when it comes to touting the strength of the housing markets. Yun met with Realtors in Coral Gables this week and told them this is nothing more than a “small blip on the radar screen.” He touted prices to be 20-30 percent higher in Florida in just five years. As a member of the National Association of Realtors, I take great offense to jackasses like Yun and Lereah, and the folks we pay our dues to, that are pushing clowns like this into perpetrating a national fraud on consumers and institutions.”


  44. thatBIGwindow says:

    Can anyone give me information on MLS # 20820172
    (Monmouth County – Freehold)

    I am interested in days on market and if it is under atty review, or under contract or sold?


  45. kettle1 says:

    # 35 Clotpoll,

    Thats a good idea, but then you might have to give back all those “donations” that the farm lobbies have so generously contributed.

    I am fairly certain that you would have some very unhappy lobbyists ( spelling?). after all, what did all of that money and those private jet rides, college scholarships, consulting positions go to then?

  46. kettle1 says:

    everything’s broken….

    hmmm, who gave saddam chemical weapons???? if i remember correctly a certain 3 letter agency was responsible for that! So does that mean that the USA shouls be held responsible for chemical WMD in iraq?

    We didnt seem to mind him having chemical weapons when he was using them against Iran and his own people.

  47. Sean says:

    re: news that the NAR mistated NJ sales and Yun is still preaching lots of irrational growth.

    I believe some TV style psychotherapy is needed for the NAR and Yun.

    You can move a person out of denial by deliberately provoking them to anger. Hold up the future (sympathetically) so they cannot avoid or deny it. Tell them that it is not fair. Show anger yourself (thus legitimizing that they get angry).

    This, to some extent, is done on daytime TV shows where people in precarious situations are prodded into emotional explosions that make good TV and (where sympathetically done) may even be good for them.

    Don’t worry this kind of TV psychotherapy is practiced widely by lots of hacks (Dr. Phil for example) and so far isn’t illegal.

  48. Hard Place says:

    BC Bob –

    A big % of the bonus $ was RSU’s. That’s why the Merrill trader decided to sprinkle his do do all over the joint.

    Alright, I’ll bite. What’s the story on this one?

  49. DL says:

    NJ property taxes at work:
    New Jersey has an expanded “200 Club” — superintendents and school administrators with salaries of $200,000 or more.

    The number of superintendents and administrators in that club has grown 28 percent since the 2005-06 school year, rising from 13 to 48 this year, according to an Asbury Park Press review of new public school salary data.


  50. John says:

    Crude Oil Rises to Record $139.89 also can anyone guess what this Jersey estate will go for on the courthouse steps in August?


  51. Hard Place says:

    frank – NYC Housing Market Showing Cracks – Barron’s

    There goes the plankton in Manhattan.

  52. RentinginNJ says:


    I think your experience with your friend is fairly common of bursting bubbles. The downturn is almost always deeper and longer than most people think (not that I need to tell you that). Until all is said and done, most people won’t even admit the existence of a bubble; they tend to think the market just got a little overheated; needs to correct a bit and then all will be fine again.

    Although, I really think realtors® are shooting themselves in the foot by continuing to play the bubble burst as a short term, relatively minor phenomenon that presents buyers the opportunity of a lifetime. This gives sellers false hope that keeps them from dropping their homes to a level that would clear the market. It also means no commission checks for realtors.

  53. njcoast says:

    #44 thatBIGwindow

    MLS#20820172-21 Monument St.Freehold Boro
    Original list-7/20/06-$999,000
    Relisted-1/16/07- $949,000
    Relisted-1/12/08- $899,000
    Relisted-5/14/08- $849,000

    Sold-4/28/95- $214,000
    Sold-8/19/96- $109,000

    Current property taxes- $10,796
    Tax assessment-$529,200

  54. NNJ says:

    NYC Housing Market Showing Cracks – Barron’s
    Most encouraging? Since NYC’s economic troubles generally lag the nation’s, some see its decline as an indication that the national housing slump has begun its final phase.

  55. thatBIGwindow says:

    Thanks njcoast! :)

  56. spyder says:

    Good Morning all,

    Can someone please provide some background and history on this property- mls # 2808232


  57. BC Bob says:

    “some see its decline”

    NNJ [55],

    Many felt that Bear was a bargain at $60.

  58. re wmd
    look up Van Anraat, alias the courageous and intelligent fabric salesman

  59. make money says:


    “Was there any corn in the pooh poo?”

    I love it.

  60. RentinginNJ says:

    You have to buy NOW because interest rates are only going to go up.

    It is the new mantra. I hear it all of the time from Realtors®.

    Next time I hear it at an open house, my response will be, “That’s okay. I’m not really all that concerned with interest rates”.

    After which, the realtor® will either look at me like I have 2 heads or will gently try to educate this young buyer on how higher interest rates will make the payment more expensive. And, if I want to afford something decent, I had best buy now before rates go up and make my little slice of the American dream unaffordable.

    I will then ask then realtor, “if interest rates go up for everybody, if the buying power of all buyers is slashed by higher interest rates, then who is going to be able to afford these prices? It’s not just my buying power that gets cut, it’s all buyers. Prices will just have to come down to reflect this reduction in buying power caused by higher rates. I have a meaningful down payment saved, so in reality, I would probably be better off. I can always refinance my interest rate, but I’m stuck with the principle. In fact, I think sellers should be more concerned about rising rates. They’d better sell now or they might never be able to get a good price. So, put that in your pipe and smoke it!”

  61. NNJ says:

    [58 BC Bob]
    And many thought GOOG at $200 was overpriced.

  62. kettle1 says:


    one reason i am so frustrated with this person is that they have a good opportunity to get while the getting is good. They may take a 30-40K loss on their house by selling now, but they can probably break even in other manners. The house is HUGE, way over sized for their needs and the upkeep is expensive. By moving they can downsize to something even half the size . so they have fewer maint. costs, a cheaper home (just due to size reduction, they would be staying in similar RE markets).

    The #’s say suck it up and sell, but the emotional side of I wont take a loss, is winning. I know that the emotional response is the more common on, but still frustrating.

    On a side note there was some economics study that showed that people were more likely to ride an investment (or home) down, then dump it, take a small loss and move on.

  63. SIMONfromLYNDHURST says:

    Perspective of owners vs renters.

    i have a buddy who owns 3 properties in nj. i am currently a renter and i know little to nothing about nj real estate while he probably knows a lot more from his past experiences with real estate. i don’t profess to know more than my buddy but one area that we see to butt heads a lot about is what is the main reason for the ongoing housing decline (aside from all the foreclosures). My opinion is i feel that home prices have gotten completely out of whack over the past few yrs and are still overpriced. his reason for the housing slowdown is the lack of available loans for buyers. with 3 properties in his name, i can completely see why he wouldn’t want to admit to the market being too expensive. he wants to protect his investments and not admit that prices are too high. is this the case with all (most) home owners? do most of you on this board who own homes feel like prices are reasonable and the reason for this decline is due to the lack of available loans? with the hope of buying my first home sometime in 2009, i continue to welcome the bad news in the housing market.

  64. thatBIGwindow says:

    Hi Simon, fellow South Bergenite here…as a homeowner yes, prices are out of whack. Lack of available loans is preventing overpriced houses from selling, but the wacky loans were the reason prices got so high in the first place. So, I guess high prices and wacky loans go hand in hand…

  65. SIMONfromLYNDHURST says:

    Is there a site that ranks NJ property taxes from cheapest city to most expensive city?

  66. Hard Place says:

    NNJ (62) – At least GOOG’s sales were growing. Last I saw NJ sales were growing only 4%, ooops, I mean down 30%.

  67. Hard Place says:


    Both of you are right!

  68. gary says:

    To all at the GTG,

    I had a miserable time, you all s*ck, I hate you all.

    Gary ;)

  69. SIMONfromLYNDHURST says:

    #68 – I know but i just find it funny how adamant my friend is about current house prices being “fair”. I know loans are harder to get now but prices are going to have to give before this market can recover.

  70. Stu says:



    You can probably get what you desire from here.

  71. SIMONfromLYNDHURST says:

    #71 – Exactly what i was looking for. Thanks.

  72. grim says:

    Very interesting, NAHB is breaking from standard practice and releasing the HMI numbers via teleconference today.


  73. Rich In NNJ says:

    Old Tappan Comp Killer!

    2410402 Sold
    SLD 14 DEARBORN DR $630,000 7/30/2004

    2539451 Expired
    ACT 14 DEARBORN DR $715,000 11/29/2005
    EXP 14 DEARBORN DR $715,000 5/31/2006
    EXT 14 DEARBORN DR $715,000 6/12/2006
    EXP 14 DEARBORN DR $715,000 7/31/2006
    2814088 Withdrawn
    ACT 14 DEARBORN DR $615,000 4/4/2008
    W-C 14 DEARBORN DR $615,000 5/6/2008
    2819685 Sold
    ACT 14 DEARBORN DR $615,000
    ACT* 14 DEARBORN DR $615,000 5/13/2008
    U/C 14 DEARBORN DR $615,000 5/23/2008
    SLD 14 DEARBORN DR $600,000 6/13/2008

  74. spyder says:

    can someone provide a background and history for this property, mls #2808232. Its been sitting vacant on my parent’s block for over a year now.


  75. Rich In NNJ says:

    Englewood FUTURE Comp Killer!

    SLD 256 LIBERTY RD $400,000 11/16/2005

    ACT 256 LIBERTY RD $369,000 6/16/2008

  76. still_looking says:

    #69, gary – we love you too :-)

    RichNNJ, how did you get out of the rope and duct tape so fast?? BTW- No Problem at all!!

    To grim, thanks for yet another great GTG! It’s really nice to put faces to the names!


  77. Rich In NNJ says:

    Gary (69)

    Screw you. ;-p

    Still (77),

    As painful as was losing all that hair thanks to that tape, it was no where near as painful as it was explaining it the bride was the tough part.
    I posted the following yesterday (in case you didn’t see it).

    I had a blast meeting everyone last night as well!
    I haven’t been out of the house in so long I “flew out of the gate”. Next time I’ll be sure to eat BEFORE the next GTG…

    Big thanks to Mr. & Mrs. Still Looking for the ride home! You saved me at least 1 1/2 hours!
    Besides, because I had my head in a book on the way in, I got off the train in Secaucus. Hate to see where I would end up after gin, bourbon and cachaca! I don’t know how Brooklyn Hawk does it…

    Rich NNJ actually thought I was 50.5. Yikes. That’s OK Rich, BC Jane passed on a secret. My lips are sealed.

    Well, that was quite the entrance you made. It threw me off guard (or on guard)!
    Thanks for keeping it “mum”, though after calling you RE101, I don’t deserve the discretion.

    Hmmm, a Bergen County GTG next?

  78. Clotpoll says:


    Thanks for the Mike Morgan update. For a while, I thought a NAR truth squad had gotten to him.

  79. gary says:

    Rich in NNJ,

    See, that was the problem, explaining it to the bride in the first place. I’ll send you the ten point checklist. ;)

  80. gary says:


    Rope and duct_tape?? Darn, I left before the party really got started!!

  81. Nom Deplume says:


    I don’t know of a single site (perhaps on NJ.com), but I do know that the NJ Div of Tax posts rate data on thier website. You can get it by county and it posts rate data for each town.

    There are also annual reports produced by the Division that contain abstract data, though it isn’t easy to read and the reports are old once they are posted (I think 2006 is the most recent).

  82. NJGator says:

    44 – Wow that place boasts a great by the County Courthouse location. It’s a deal!

    Sarcasm off : )

  83. gary says:

    BTW, checked out one open house yesterday and the realtor said, “I would consider purchasing soon as interests rates are on the rise.” lol!

    So, the mantra has gone from ‘buy now or be priced out forever’ to ‘buy now before interest rates rise’. If looks could kill, then my wife is a murderer.

  84. make money says:

    The summer heat has hit Wall Street, and everyone’s nervous about investment banks’ financial results. Sound familiar?

    At this point last year, reports were surfacing about investors bailing out of a Bear Stearns Cos. fund that bet heavily on risky mortgages. A few days later, Bear Stearns committed more than $3 billion worth of loans to keep the fund from sinking — a move that revealed to investors how much surging mortgage defaults could cost the banks exposed to them.

    Wall Street at the time called the ensuing turmoil in the debt markets the “summer credit crunch.”

    Well, the summer of 2008 is at hand. And the crunch is still here.


  85. still_looking says:

    rich 78: awwww shucks… It was our pleasure… plus it’s worth just knowing the inside line on 240 Paramus…


  86. grim says:

    An open house on Father’s Day?

    Sounds like an emasculative bear trap schemed up by Suzanne.

    You’d have bought that house if you were a good father Gary.

  87. gary says:

    grim [87],

    In that case, I’m a crappy Dad!

  88. grim says:

    Think of how difficult this is for Graydon and Ellery.

  89. gary says:

    Graydon and Ellery are at The Winthorpe Equestrian Camp for the next two weeks.

  90. Secondary Market says:

    BlackRock watch. 1,100 NJ employees could be relocated to Philadelphia, where the proposed head quarters will reside.
    All the city needs to do is extend the business tax breaks to year 2020 from 2018.

  91. gary says:

    And the little b*stard Graydon wanted to know what present he’s getting for being promoted to the 6th grade… you’d think the party at La place d’enfant would be enough. I told these kids enough is enough…. no one gets anything else until mommy is out of rehab. It’s time I put my foot down.

  92. SG says:

    Over in the US, futures pricing indicates a 78% likelihood of a Fed rate hike at the October 29th FOMC meeting, a 63% chance of a hike on September 16th and even a 25% chance of a hike as early as August 5th. Were we imagining it, or did the US unemployment rate rise sharply to 5.5% recently?


  93. bairen says:

    Attn: RE agents. (this message is for the 66.8% of RE agents who are clueless and/or unethical)

    Stop telling me how much I can afford and trying to push the most expensive pos in my price range on us.

    You pros frequently convienently forget/ignore things like daycare, utility, and emergency reserves.

    Stop trying to convince me it’s cheaper to own then rent. No it is not. You back your data with the “look to rent you need 1.5 month’s security deposit, + commission, + moving costs, that is what closing costs are.” Hey agents, I can rent my townhouse for 1k a month less then to buy it with 20% down. Also my rent does not depreciate. In fact I got this place for 10% off asking rent and only half the asked commission. I bet my next rental I’ll get a nicer place for lesss money then this dump, and pay ZERO commission. some FB will be happy to rent to my family with our income and credit score.

    And agents, unless you are selling multi million dollar homes, you make your money off of deal flow. (lots of transactions.

    I picked 66.8 since that is a lucky number in Chinese. Actual percentage may be signiciantly different. Like the NAR sales figures for NJ.

  94. SG says:

    Foreclosure filings in New York increase 25 percent

    New York’s foreclosure rate in May stood at one filing for every 1,500 households, down from one for every 1,387 households in April. The nationwide average is one for every 483 households. New York ranked 32nd on RealtyTrac’s list.

  95. bairen says:

    I have decided to apply NAR’s statistical accuracy to my age. Thus instead of getting 3% older this year I am actually 30% younger and am reliving my 20’s.

    Thanks for adding a decade to my life NAR.

  96. SG says:

    The Bubble

    The mortgage executives who gathered in a blond-wood conference room in Southern California studied their internal reports with growing alarm.

  97. bairen says:

    #84 gary,

    Come on gary. Man up already!

    Buy before rates go up. making it harder for you (but no one else in the world) to buy.

    Especially if you get to keep the pretty balloons tied to the sign. Nothing like the site of balloons flapping in the wind wants me to break out the old check book.

  98. grim says:

    June HMI down to 18, a record low

  99. John says:

    Actually my friends two bedroom house had a lot of traffic on father’s day as it is being marketed to divorced wommen and single women with no near term prospects of a man.

  100. COAH is a scam says:

    Can someone who has a lot more time than me please expose COAH for the scam that it is? This is just another way to give money to the construction business that contributes to the politians. The only people that qualify to live in the units are the people that hide their income. I’ve heard this several times that people who have undocumented income like tips or jobs paid in cash are the only people that do not exceed the income limits and still have enough money to make the payments. In the exurbs, these units are only 50% occupied because no one can afford to live there and own a car. Now they want to build a lot more units that will be vacant. Brilliant!

  101. NJGator says:

    92 Gary – Is Mommy in rehab for Anorexia or Coke?

  102. Sybarite says:

    John Says:
    June 16th, 2008 at 1:16 pm
    “single women with no near term prospects of a man.”

    LOL @ this new demographic niche.

  103. NJLifer says:

    Add “blogging” to the things we take for granted…


    Blogger arrests hit record high

    More bloggers than ever face arrest for exposing human rights abuses or criticising governments, says a report.

    Since 2003, 64 people have been arrested for publishing their views on a blog, says the University of Washington annual report.

    In 2007 three times as many people were arrested for blogging about political issues than in 2006, it revealed.

    More than half of all the arrests since 2003 have been made in China, Egypt and Iran, said the report.

    Jail sentence

    Citizens have faced arrest and jail for blogging about many different topics, said the World Information Access (WIA) report.

    Arrested bloggers exposed corruption in government, abuse of human rights or suppression of protests. They criticised public policies and took political figures to task.

    The report said the rising number of arrests was testament to the “growing” political importance of blogging. It noted that arrests tended to increase during times of “political uncertainty”, such as around general elections or during large scale protests.

    Jail time followed arrest for many bloggers, said the report, which found that the average prison sentence for blogging was 15 months. The longest sentence found by the WIA was eight years.

    It acknowledged that the true number of bloggers arrested could be far higher than the total it found as, in some cases, it proved hard to verify if an arrest had taken place and on what grounds.

    For instance, it said the Committee to Protect Bloggers has published information about 344 people arrested in Burma – many of whom are thought to be be bloggers – but the WIA could not verify all the reports.

    It also noted that many nations, perhaps as many as 30, imposed technological restrictions on what people can do online. In nations such as China this made it difficult for people to use a blog as a means of protest.

    The report pointed out that it is not just governments in the Middle East and East Asia that have taken steps against those publishing their opinions online. In the last four years, British, French, Canadian and American bloggers have also been arrested.

    The report predicted that the number of blogger arrests in 2008 would exceed the 36 seen in 2007 thanks to greater popularity of blogging as a medium, greater enforcement of net restrictions, and elections in China, Pakistan, Iran and the US.

  104. grim says:

    From MarketWatch:

    Home builders index matches record low in June

    U.S. home builders were as gloomy as ever in June, the National Association of Home Builders reported Monday. The housing market index fell by a point to 18, matching the record low in the 22-year history of the survey. The survey shows that about one in five builders thinks the housing market is good. The subindex for current sales also matched a record low in June, while measures of expected sales were stable. Traffic of prospective buyers fell in June. The builders said Congress must act immediately to pass a home buyers’ tax credit, along with other measures to help housing. Sales should continue to erode in coming months, said David Seiders, chief economist for the builders.

  105. manhattanexile says:

    #42 John,

    how can the taxes really be that cheap for this?

    “Annual Real Estate Taxes: $10,840.20”

  106. grim says:

    From Reuters:

    Home builder sentiment dips to match record low

    Home builder sentiment sank 1 point in June to match the lowest level on record set in December, an industry group said on Thursday.
    The National Association of Home Builders said its preliminary NAHB/Wells Fargo Housing Market Index fell to 18 from 19, the same level reached in December and the lowest since the index began in January 1985.

    A June reading of 19 was forecast in a Reuters poll of 43 economists.

    Readings below 50 indicate more builders view market conditions as poor than favorable.

  107. HEHEHE says:

    Last One Left, Please Turn Out the Lights
    Wall Street is in the midst of its biggest, ugliest, worst round of layoffs in decades.

    By Jim Cramer


  108. Seneca says:

    Is America’s Suburban Dream Collapsing Into a Nightmare?


    “Nelson (director of Virginia Tech’s Metropolitan Institute)… estimates that in 2025 there will be a surplus of 22 million large-lot homes that will not be left vacant in a suburban wasteland but instead occupied by lower classes who have been driven out of their once affordable inner-city apartments and houses.

    The so-called McMansion, he said, will become the new multi-family home for the poor.

    “What is going to happen is lower and lower-middle income families squeezed out of downtown and glamorous suburban locations are going to be pushed economically into these McMansions at the suburban fringe,” said Nelson. “There will probably be ten people living in one house.””

    …. so Hoboken, and all the other towns in NJ that are billing themselves as the “next Hoboken” should be fine.

  109. HEHEHE says:

    Goldman cuts M&A jobs as business slows: sources
    Mon Jun 16, 2008 12:47pm EDT


  110. #104 – LOL @ this new demographic niche.
    I was wondering how you would market to them.
    – 2 bedroom, 1 1/2 bath with room for loads of cats?

  111. gary says:

    NJGator [103],


  112. grim says:

    Northeast HMI down to 12, record low.

  113. ministryofmagic says:

    (42 John)

    uhh.. how is that the maltz auction for the rockleigh mansion has taxes of only 10,421?????

  114. bairen says:


    As a bonus the house has extra large fridge and no mirrors. Perfect for the oversized old maid crowd.

  115. NJLifer says:

    When a house gets foreclosed on and auctioned, if the auction comes in for less than the balance owed, who’s on the hook for the difference, the bank or the former owner? I always thought the prior owner, but being that so many people are taking the “it’s not worth it for me to keep making payments on a depreciating assets”, I now wonder???

  116. skep-tic says:

    I think most of the people who don’t get how bad the housing market is are baby boomers. They just have too much invested in house prices being high (i.e., their quickly fading retirements).

    I was at a wedding over the weekend (the part I wasn’t working, anyway) and I talked to probably ten diff’t couples who said they had started looking at houses/apts but that asking prices are still insane and they are now waiting a year. These included people from NYC, Boston, LA, San Fran and even Texas.

    I think educated first time buyers have grown to a consensus that houses are wildly overpriced and that is why we are continuing to see transactions plummet even as we are 1.5-2 yrs now from the peak.

    Meanwhile, baby boomers still do not get that this is a uniquely bad downturn. All they talk about is how hard it was to buy their house when interest rates were 14% and they made $30k annually (no mention that their house cost $60k at the time). Well, that was not too bad compared to today, and myself and many people I know would be buying if that’s what we were looking at.

  117. make money says:

    Northeast HMI down to 12, record low.

    Everyone is looking for a bailout.

  118. lisoosh says:

    I’d be up for the Turtle Back Zoo trip too if the time and date are convenient. Will be available through most of July, August is out.

    3b – weren’t you going to be in Edinburgh some time this year?

  119. skep-tic says:


    anyone can improve himself via a pub crawl through Grassmarket.

  120. John says:

    I don’t know why that house has such cheap taxes, it says to do due diliegence so maybe it is wrong.

    BTW houses are historically cheap. Back when interest rates were 14% money was way tight in that recession. The people complaining about housings costs today in their leased cars, cell phones, dog groomers and lattes should take a trip back to 1974 or even 1982 and try pushing a 5,000 pound rusty chevy up to the pump so you would not waste gas idling. Heck every Mom cut their own kids hair and sewed clothes and no frills luke warm powered milk on storebrand ceral was the breakfast of champions.

    My unemployed friend is most likely in his BMW off to the country club for some golf today, back in 1982 the only time an unemployed person went to a country club is to apply for a dishwasher job.

  121. Clotpoll says:

    gary (90)-

    …learning how to milk stallions?

  122. John says:

    Re 110 think coop city in the bronx, what started as an oasis quickly turned into a cess pool.

  123. Seneca says:

    John 124, I was being sarcastic about Hoboken and its ilk being fine. (In case you missed that.)

    That being said, I would much prefer a Livingston Town Center type of environment but at $600k+ just to get into a condo there, no thanks.

    But anything that looks like projects, even if it has a fancy facade, is just projects.

  124. Nom Deplume says:


    Typically, a mortgage is made “with recourse” meaning that the bank can chase you for the deficiency. That involves costs, however, and the fact is, the banks simply choose to write off deficiencies unless they know that they can collect somewhere.

    Even to be able to collect a deficiency, the bank must reduce the deficiency to a judgment. This involves more costs such that, at the end of the day, they recover little if anything on their investment.

    Since banks are so overwhelmed with jingle mail, the “buy and bail” type that skates on an upside-down house is likely only to get dinged with 7 years negative credit reporting, and will reap the benefit of the lower house payment, at least until the loan is sold to a credit collections operation that purchases defaulted loans cheap and turns them into judgments. Then they take the property and go after the buy and bail debtors’ property, wherever located. So the prior owner skates for now, but that debt may still catch up to them.

    If the loan is “nonrecourse,” the debtor skates with a blemish on their credit history. In that instance, they can’t be touched. A “nonrecourse” loan is unusual in residential mortgages though.

  125. grim says:

    From Reuters:

    Goldman Cuts Hundreds of Bankers, Support Staff

    Goldman Sachs Group laid off investment bankers last week as it reacts to slowing markets and a slump in merger activity, according to people familiar with the situation and Wall Street recruiters.

    The cuts, described as in the hundreds, were concentrated among support staff and junior level bankers.

    One insider told Reuters that 25 percent of employees at the vice-president level were let go.

    In April the world’s largest securities firm initiated a round of market-related cuts, hitting such areas as leveraged lending and mortgage securities, though none have been announced publicly.

  126. GetAClueNJ says:

    #118 skep-tic

    I agree 100% with what you said. As wannabe first time buyer, that has many friends of the same status, we are all in agreement that none of us can afford to purchase our own homes. The incomes you would have to make just to afford even the most modest dump is mindboggling. Something has to give.

    Oh, and my father, a tail end boomer born in 1960, likes giving me the same example you did, about how his first mortgage was 12.5% in 1983, but fails to mention his home only being 2.5x his annual income. That same property (a townhouse) is now almost 4.5x my $70k annual income. Something doesn’t add up. He was a high school grad working as an electrician. I have a college degree working in financial analytics. You would think I’d have no problem affording that same property.

  127. NJLifer says:

    126 Thanks DM,

    So it seems like, in the end, they get their come-upins.

  128. skep-tic says:

    John– high interest rates are not as bad as high prices. You can refinance when interest rates drop and mortgage interest is deductible. I would love to see mortgage interest rates go to double digits– house prices would collapse by 50%

  129. Nom Deplume says:

    [130] Lifer,

    Maybe. Like all else, it requires work and luck. But in theory, those who skate with assets should pay, and those without, well, they would skate anyway.

  130. Nom Deplume says:

    Based on the blog, I am missing a heck of a US Open playoff. Gotta to to the attorney lounge for big screen coverage.

  131. lisoosh says:

    skep-tic Says:
    June 16th, 2008 at 2:43 pm

    “anyone can improve himself via a pub crawl through Grassmarket.”

    100 points (or should that be pints?) for knowing about Grassmarket.

    100 bonus points if you know about Rose Street.

    1000 gold star brownie points if the term “pavement pizza” is both familiar and conjures up painful images.

  132. SG says:

    Definitely worth read.

    The Bubble

  133. skep-tic says:

    “100 bonus points if you know about Rose Street.”

    Filthy McNasty’s rings a bell. Someone told me I was there one night.

  134. SG says:

    From Washington post article,

    One member of the Fed watched the developments with increasing trepidation: Edward Gramlich, a former University of Michigan economist who had been nominated to the central bank by President Bill Clinton. Gramlich would later call subprime lending “a great national experiment” in expanding homeownership.

    In 2003, Gramlich invited a Chicago housing advocate for a private lunch in his Washington office. Bruce Gottschall, a 30-year industry veteran, took the opportunity to pull out a map of Chicago, showing the Fed governor which communities had been exposed to large numbers of subprime loans. Homes were going into foreclosure. Gottschall said the Fed governor already “seemed to know some of the underlying problems.”

    Connelly said he secured many loans for restaurant workers, including one for $500,000 for a McDonald’s employee who earned about $35,000 a year.

    A mortgage lender could hire practically anybody. “It’s not rocket science,” Connelly would tell new hires, such as the busboy who quickly traded in his Toyota Tercel (value: $1,000) for a Mazda Miata sports car (value: $25,000). Pinnacle was running out of office space, forcing some loan officers to work on window ledges or out of their cars.

  135. SG says:

    #137 in Mod.

  136. jam says:

    [133] What county has at attorney lounge with a big screen?

  137. SG says:


    How large? Well – the equity lost can be very roughly estimated from first principles. There are about 6,000,000 subprime mortgages in the USA. They typically result from re-financing deals – topping up to utilise whatever equity has accumulated in a house usually to pay off credit card debt; so they stay near 100% outstanding. The average house price in the USA is about $190,000, but we can reduce that to $150,000 on the assumption that we’re at the lower end of the market. That gives us a principal sum of $900,000,000,000, which is 7 times the size of the LTCM exposure. But the more serious figure – the housing equity lost to falling prices – is currently estimated at approaching 8% which is $72 billion, not including an adjustment for synthetic CDOs created by investment bankers to short the weakest MBSs – as they did with Delphi.
    Now you can see the difference in scale between LTCM and the subprime bust. This may be 20 times worse than LTCM. And it’s getting worse – daily.

    I think the above assumption of $150K average subprime home is probably understatement. As the larger use of these loans was in CA, FL, NV, NJ etc… all high cost of living areas.

  138. NJGator says:

    114 – Gary – Well the coke suppresses the appetite, you know. Graydon should be proud to have such a thin and chic Mummy!

  139. lisoosh says:

    skep-tic Says:
    June 16th, 2008 at 3:40 pm

    “Filthy McNasty’s rings a bell. Someone told me I was there one night.”


  140. scribe says:

    I’d like to say – Gary is fresh-faced and angelic, like a choir boy.

    Sorry to ruin your image as a housing terrorist, Gary :)

  141. Cramer in NY Mag, Wall Street is dead. Apparently he’s hearing rumors that the Fed may have gotten the better part of the Bear deal and the losses are so large JP will have to cover.
    It is Cramer though so take it for what it is.

  142. Duckweed says:

    Off topic but what is a good study guide for taking the real estate license exam if one is not planning on taking real estate classes? I am mainly interested in collections of previous examination questions.

    Also, how different are the exams between states? Sure there are title states and lien states, escrow states and non-escrow states, judicial foreclosure states and states with redemptions. But do exams tend to focus on the basic anatomy of a transaction or do they dwell on the differences between states?

    Thank you for your advice.

  143. bi says:

    “To borrow a phrase used in Clinton and Obama’s campaigns, maybe one can describe the feelings that voters might encounter: Everyone imagine for a moment the person who picks up the red phone at 3am in the morning in the White House — if it’s McCain, they will be at ease.”


  144. SG says:

    So. California home prices, sales plunged in May

    Home prices, sales plunged in May across SoCal compared to last year

    LOS ANGELES (AP) — Median home prices dropped 26.7 percent in May across Southern California’s six most populous counties compared with last year, a real estate research firm said Monday.

    DataQuick Information Systems said it marked the steepest annual drop since the firm began keeping records in 1988.

    Price drop of 26.7% !!!

  145. Tom says:

    “i feel that home prices have gotten completely out of whack over the past few yrs and are still overpriced. his reason for the housing slowdown is the lack of available loans for buyers.”


    You’re both right. Home prices have gotten completely out of whack because lenders were throwing money as fast as they could to anyone that wanted to buy a house.

    The lack of available loans for buyers is because banks realized how stupid they were after they started seeing so many defaults and foreclosures.

    If you want I have some more details on local and national house prices with charts here.

    So eventually they’re going to have to go back to their more conservative lending practices.

  146. frank says:

    “So. California home prices, sales plunged in May”

    When are we going to see these declines in NJ?

  147. bi says:

    this article was published 4 years ago, long before Obama announced his bid for presidency.

    Columnist Says Barack Obama ‘Lied To The American People;’
    Asks Publisher to Withdraw Obama’s Book


  148. meter says:

    Yeah right, 146.

    At ease, or concerned that the sudden noise might induce a stroke or heart attack?

  149. afe says:

    There is an underlying assumption in psychology that the more you ignore an underlying issue, the greater its effects when it does rear its ugly head.

    E.g. family gathering and Uncle George is pretty much passed out drunk on the sofa (again!) but still managing to make off-color jokes to your new fiancee. You feel angry but don’t say anything on Thursday/Friday/Saturday. On Sunday, he tries to help your fiancee bring her luggage to the car, dropping her new laptop and you blow your lid, dropping him to the ground.

    I am sure all of you in finance, law, medicine etc see how this theory applies to specific situations in your fields.

    With the NAR’s complete denial of the market status in NJ, I am really worried that the market here compared to CA, NV, etc will react that much more violently. I am very worried.

  150. bairen says:

    #149 soon Frank.

    1st comes the slow down in price appreciation.

    Then flat line to slight drop in price and slowing down in volume.

    Followed by plunge in volume (Grim was right on 1st quarter this year down 30% in volume)

    This has been the pattern for all the other bubble areas that have seen price plunges. If NJ follows the same pattern we should be seeing price plunges in 6 to 12 months.

    Basking Ridge and New Providence are already down 16 to 20% since March 07. If the drop maintains that pace end of 09 would be about 35% down over a 3 year period. Although with the disruptions in the credit market and higher lending standards I think it may take less time.

    I could be completely wrong. Wouldn’t be the first time. I really thought The price drops would start happening in 04 or 05.

  151. SIMONfromLYNDHURST says:

    #148 – interesting read. thanks for the link.

  152. John says:

    Hey I also read a good one today that Michelle Obama grew up in a slum and OMG shared a bedroom. Funny thing is it says her dad died a while back and her mother still lives in that junky apt in the slum by herself to this day. This was on an official bio site from a real magazine quoting her. Wow our future first lady lets her mother live in a slum but don’t worry she will look out for you and me.

  153. Anxious but waiting says:

    grim or anyone who has access..
    could you please give me the address of this rental.. MLS 2533917.
    I’d like to see where it is..


  154. Pat says:

    John, my 89 yo MIL still lives in her shotgun house in Podunk, NY with the 1940’s wallpaper and the painted brown floorboards.

    That doesn’t mean her grown children haven’t asked her to live with them.

    She likes to plant her tomato seedlings next to the porch and crochet and take her Hyundai for an oil change so she can sneak an Egg McMuffin at Mickey Dee’s.

    If it makes her happy, she can get oil changes every week. We don’t care.

  155. grim says:


    17 Madison Street

  156. John says:

    “Earlier in my college career, there was no doubt in my mind that as a member of the Black community I was somehow obligated to this community and would use all of my present and future resources to benefit this community first and foremost. … with the increasing integration of Blacks into the mainstream society, many “integrated Blacks” have lost touch with the Black culture in their attempts to become adjusted and comfortable in their new culture – the White culture.”

  157. bi says:

    103#, COAH is a scam: absolutely. trenton politics is the worst in the nation. iam amazed that even informed bloggers on this board keep sending them back to office.

  158. frank says:

    Is there a reason Realtor.com does not show addresses for NJ properties?
    It does for other states.

  159. grim says:


    What use would a Realtor be then?

  160. Clotpoll says:

    bi (160)-

    “trenton politics is the worst in the nation. iam amazed that even informed bloggers on this board keep sending them back to office.”

    bi, sorry to once again burst your bubble…but, the posters here don’t add up to a fraction of a fraction of .1% of the voters in NJ. You and me and grim and Ed McMansion are fleas on the butt of a brontosaurus, politically speaking.

  161. insideguy says:

    27. Tom,

    Wmd were found in Iraq. What do you expect, warehouses of projectiles racked stacked and labelled? In English like sadam’s old ‘baby food factory’ stunt? A little vial of sarin gas can kill scores of thousands. There were mustard weapons everywhere as the troops moved thru. Army buddies of mine saw them with their own eyes. K’mon…

    This forum ain’t for this type stuff but keep the skweeky kleen dictator nonsense to yourself.

  162. Clotpoll says:

    John (159)-

    Wow, what a scoop. Never saw that before.

    Why don’t you just go ahead and let fly the racist screed you are probably going to end up torturing us with anyway? We don’t need the incremental buildup.

    While you’re at it, please also be sure to mention that Baby Daddy is a Muslim Manchurian Candidate. No good anti-Obama rant should be without that little factoid.

    All disclaimers: I’m not an Obama supporter.

  163. skep-tic says:

    I think this campaign has the highest total combined hotness of candidates’ wives ever

  164. Nom Deplume says:

    Grim, 167 in mod

  165. scribe says:


    realtor.com is showing addresses now on most properties in the towns I scroll through …


    It’s recent, but it’s not that recent.

  166. Tom says:

    164: insideguy,

    are you talking about these weapons?


    But defense officials said Thursday that the weapons were not considered likely to be dangerous because of their age, which they determined to be pre-1991.

    Pentagon officials told NBC News that the munitions are the same kind of ordnance the U.S. military has been gathering in Iraq for the past several years, and “not the WMD we were looking for when we went in this time.”

    The officials spoke on condition of anonymity because of the sensitive nature of the issue.

    “We were able to determine that [the missile] is, in fact, degraded and … is consistent with what we would expect from finding a munition that was dated back to pre-Gulf War,” an intelligence official told NBC. “However, even in the degraded state, our assessment is that they could pose an up-to-lethal hazard if used in attacks against coalition forces.”

  167. Stu says:


    Why don’t you tell us that the Japanese are drilling for oil 60 miles off the shore of Cuba or that Patreus drives the streets of Baghdad ‘all the time’ in an unarmoured SUV without protection. Obama’s momma might live in a slum (which I highly doubt, sounds an awful lot like a typical fabricated Fox/NY Post article), but it pales in comparison to how McCane treated his first wife and uses his second wife. But let your racism speak for itself. Did you hear that Obama wants to make the fried chicken our national bird? I saw it on Fox so it must be true.

  168. schabadoo says:


    I don’t think insideguy was actually looking for facts.

    They get in the way of well-rehearsed rants.

  169. afe says:

    frank- I find coldwell banker tends to list addresses pretty consistently. With the other agencies, it is kind of hit or miss if a particular agent has address info.

  170. gary says:

    scribe [143],

    Thank you!! You are so kind and it was such a pleasure talking with you!

  171. Tom says:

    Since so many different people from NJ that read this I want to make an offtopic request.

    If you work for PSE&G, please keep the lights on. I haven’t replaced my UPS battery yet :)

  172. alia says:

    167 Nom: I haven’t worried about the cause (president or devaluation of the dollar or…) but I also have been wondering if “now would be a good time to buy” (ducks)… I’m still waiting, since our apartment is large and there’s nothing so wonderful as the sound of the landlady’s son shoveling the snow at 8 am on a winter morning while my husband and i burrow under the covers… we really thought we were priced out of our nyc neighborhood, but prices are finally coming down… or at least, offers below list are being accepted by some sellers. so… we’re waiting because we can afford to be flexible. but maybe we won’t wait to buy until “the bottom”… and maybe we’ll flee the country. or both! :)

  173. PGC says:

    #134 Lisoosh

    Do I get points for having “worked the Fringe”, while living in a caravan out near Leith.

  174. alia says:

    pgc: jealous.

  175. Clotpoll says:

    nom (167)-

    I think an Obama presidency would be a four-year, slo-mo disaster, for many of the reasons you mention. The first shock wave would be an immediate collapse of US equity markets, as Obama’s stated goal of returning the cap gains rate to 28% and removing favorable tax treatment of dividends would trigger virtually all dividend-paying public companies to quickly declare a special one-time dividend to beat Congress to the tax-raising punch. I’d then assume all those dividend-payers would soon thereafter cancel their dividends. All the major indices would then enter a state of torpor not seen since the ’60s.

    I’d imagine Step 2 to be a brutal dismantling of whatever middle class still exists here, via staggering tax increases and “Robin Hood”-style giveaways and sops to Obama’s primary constituency: soci@l!sts and the liberal ignorati. Of course, the party line will be “pay-go” for the spending spree, instead of the Republicrat “borrow and bury the kids” stratagem…but the triumphant self-declaration of fiscal responsibility will be a thin smokescreen for the millions being taxed into oblivion.

    I think that by two years into Obama’s presidency, we’ll be witnessing two major new phenomena:

    1. Massive emigration out of the US.
    2. Frequent violent mass protests, involving the former middle/upper middle classes vs local authorities.

    Would you buy a house- anywhere- under such circumstances?

  176. Al says:

    TO Clot 179 – wow aren’t you the cheerful one today?

  177. Clotpoll says:

    Al (180)-

    You should see me on the bad days.

    You should also see the people I deal with- buy and sell- and the mortgage side of my office. It is so much worse than anything you can imagine, that I don’t really know how to put it into words. The anecdotes I share here from time to time don’t do it justice.

    BC posted a link to Mike Morgan’s blog here today. Go check it. He’s a RE broker at ground zero (Florida), and it’s his opinion that a Depression is unavoidable. I’m coming to the same conclusion, though I believe it will hit NJ later…and maybe not quite as hard.

  178. Commanderbobnj says:

    My post #181 is still in moderation ….

    Thanx, Commanderbob

  179. frank says:

    Realtors make a living in every other state why is NJ any different?

  180. frank says:

    Obama can not be any worse that the current one, so any change is a good change.

  181. sell hi says:

    real estate legal question

    I’m considering making an offer on a house, and have been told that I need to make a deposit at the time I present the offer, and that $1000 is customary for this kind of transaction.

    What is the purpose of this deposit and is it a standard practice?

    What happens to the money if I back out during attorney review or after the inspection?

  182. Nom Deplume says:


    I disagree about mid-upper class riots. People who riot do so because they have no means to address their situations. Wealthier people avoid confrontation by moving; it is the lower classes that riot. If there is going to be another Greensboro, it won’t be in Brigadoon, but in Roselle Park or Hazlet. And there aren’t enough of wealthy expatriating to cause massive out-migration. It would be mostly foreigners returning home now that the U.S. isn’t the engine it once was.

    I do agree that there would be a massive shift in the markets as people adjust their portfolios for the coming tax storm, particularly to take gains at the lower tax rate (especially valuable if the new exit tax legislation passes).

    I theorize that a soak-the-rich program would effectively hit the top 20-25%, not the 1% Obama says he targets. I have seen the tax proposals and I cannot see how the top bracket doesn’t get hit and hit hard.

    My issue comes down to this: would the economic slowdown that could accompany an Obama soak-the-rich presidency would cause blue ribbon towns to lose value since there is less disposable income for higher earners, or would the ecomomic dislocations in lower end towns cause the pricier towns to keep their value as there is only so much tony real estate and there are still enough people of means who want the relative security.

    I think it matters what happens in the macro economy–if Obama merely hikes taxes but doesn’t totally kill the economy by imposing taxes and new regulation on business, wages will rise to compensate for skilled workers (a gross up in effect, made necessary by the skilled foreigners who left) and things in these towns stay the same (prices in lesser towns continue to fall because this scenario creates cost inflation). But if Wall Street continues to lay off and the region is heavily impacted (e.g. 8+% unemployment), then either of the two scenarios I described come to pass: the price gap btwn PBC towns and the rest will increase, or they all sink together. Hard to say, but given my horizon, I don’t think a massive blow-off is likely.

  183. Nom Deplume says:

    [186] A deposit is necessary to show that you are interested and will put down earnest money.

    If you back out during A/R, you should get it back. I did.

  184. kettle1 says:

    clot et al

    the degree of change required to prevent the US from tumbling down the romanesque cliff of a dying empire would be so drastic / draconian, that i doubt anyone, even those who truly believed in them would ever accept them.

  185. kettle1 says:


    historically, most rebellions/revolutions occur when the “intelligencia/upperclass” become disaffected enough to lead the mobs into action.
    You know that you are in dangerous territory when the lower class is already unhappy and the upper classes have started to get restless.

    As long as the upper classes feel that their position is safe they will work to maintain he status quo

  186. lisoosh says:

    PGC Says:
    June 16th, 2008 at 8:13 pm
    #134 Lisoosh

    “Do I get points for having “worked the Fringe”, while living in a caravan out near Leith.”

    100 for the Fringe, 1,000,000 for the caravan in Leith, especially if it was after the introduction of the brothels. For the win if a homeless guy in a Sally Army blanket slept in a doorway nearby.

    You guys are making me homesick. Good thing I’ll be at the Festival this summer!

  187. Mikeinwaiting says:

    nom,clot,ket The concern that nom raised is in my mind to. If you don’t own there is no
    reason to buy. Ah but then again there is always the up side of inflation , making it a good move. I guess we shall see, Obama a disaster Mc Cain not much better. This is from a re point of view. Not political ideals. Let us see what the election brings. As I have said before time is on my side.

  188. skep-tic says:


    Obama seems a lot like Carter. Both of them mean well and are respectable individuals, but both of them (it seems to me) have policy ideas that would be (were) disastrous when put into practice.

  189. PeaceNow says:

    Whoah, I think more than a few of you have succumbed to the key message of the Bush presidency: that there is only an executive branch to the government, and not a legislative role at all. What, do you think that if Obama gets elected he’ll be able to just decree all of the things you’re so worried about? Clot—mass emigration? Are you out of your mind or just being sarcastic? Only the truly (and independently) wealthy will be able to afford to leave; we’re hardly talking about 30-somethings with kids, who’ll need jobs in their new adopted countries. (Which also have taxes, btw, which in most cases exceed US and NJ.)

    Oh, and re: COAH. Two points. 1) Since COAH programs were essentially mandated by a court decision, the state legislature could—and should—take up the issue. Want COAH to change? Write your assembly and senate members, don’t just post your dissatisfaction on a blog. 2) I have a relative who’s on the COAH committee in his town. Income restrictions are strictly checked there, as are any illegal rentals or sales. Of course, the new problem there is that COAH has mandated more units than can possibly be built on the remaining land.

  190. skep-tic says:


    “My issue comes down to this: would the economic slowdown that could accompany an Obama soak-the-rich presidency would cause blue ribbon towns to lose value since there is less disposable income for higher earners, or would the ecomomic dislocations in lower end towns cause the pricier towns to keep their value as there is only so much tony real estate and there are still enough people of means who want the relative security.”

    With baby boomers growing older and dropping out of the workforce, I think the demands for skilled labor will only increase in the longer term, so I expect that much of any tax increases on the upper brackets will be offset by rising incomes overall. I am of course upset about having a higher percentage of my earning taken away from me despite this. Redistribution is a proven failure as an overall economic scheme and I believe it is also morally offensive to people who work hard and make sacrifices to earn more (I say this as I am sitting at work right now).

    That said, I do not think any redistributionship scheme that Obama could sign into law could be extreme enough to stop the overall very powerful trend of increasing income stratification

  191. Tom says:


    And what are your thoughts about the current administrations policy ideas. In relation to housing, this recent washington post article states:

    Government-chartered mortgage companies Fannie Mae and Freddie Mac, encouraged by the Bush administration to expand homeownership, also bought more pools of subprime loans.

    Combine that with the tax reductions to the principles that were profiting from those loands as well as those that were profiting by trading products based on those loans.

    Somehow the lenders and gov’t authorities that were supposed to keep things in check dropped the ball.

    Whoever the next president is going to be is going to have a tough time because of the current administration. I don’t have much confidence in either candidate being able to fix things quickly. I do appreciate a candidate that acknowledges the mess and wants to try and do something about it.

  192. skep-tic says:


    “(Which also have taxes, btw, which in most cases exceed US and NJ.)”


  193. skep-tic says:


    Tom– I think the current administration’s policy ideas are kind of a disaster (with a hat tip to congress for being equally if not more awful), although I am not sure I take the housing debacle as being an example of gov’t failure. I see it more as an example of private individuals making dumb economic choices which are now coming back to bite them (as they should). The best thing that our gov’t can do at this point is to continue to stay out of the way

  194. Tom says:


    The current administration encouraged Fannie Mae and Freddie Mac to increase home ownership. There are two ways to do this, increase people’s incomes and savings so they can obtain traditional loans, or allow the types of loans that are causing problems now.

    The FM’s can’t increase people’s incomes and savings.

    For at least 20 years the house price to income ratio remained stable nationwide until 2000. It finally peaked at 153% of the 1999 value in 2005.

    Basic banking. People deposit money in banks. Banks pay interest to these people. Banks are able to pay interest because they use a portion of deposits to make money through investments. Some of these investments are in mortgages to other customers. The banks have a responsibility to invest responsibly. The gov’t insures these deposits. So that the gov’t doesn’t have to pay out claims for failed banks, they monitor their investments and set guidelines in certain ways, since if the bank fails, the FDIC might have to pay out a large sum.

    It is in the government’s self interest to make sure lenders don’t go crazy like they did in recent years. They shouldn’t be encouraging the opposite.

    If the current administration wanted to increase home ownership, the sound thing to do would be to encourage companies to increase wages. Give tax breaks to companies that are going to in turn improve the lives of it’s employees. Not to companies that are going to exploit them.

  195. lisoosh says:

    Clot – came across a listing of yours –

    Kitchen that looks like an HGTV renovation wet dream and a basement that looks like the bunker I imagine 101 broadcasting his screed from on ham radio.

    Flip that flopped?

  196. Erik J says:

    Hey everyone, I am 26 and currently a first time home buyer in the market to buy a home in New Jersey around the shore area. With student loans still needing to be paid for and how expensive things are today, its a bit of relief to see the housing market fall to a level that some of us can afford. Personally, I am glad to see its a buyer’s market. My realtor Dan Kurland of Weichert in Ocean, NJ helped me out alot and guided me through the process. He is really great and knows how to take advantage of the buyer’s market for home buyer’s in NJ. Check out his website if your interested, NJ Real Estate Website.

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