Thu 26 Jun 2008
From MarketWatch:
Existing-home sales rise 2% in May
U.S. home and condo resales inched higher in May as prices continued to fall, the National Association of Realtors reported Thursday.
Resales of U.S. houses and condos rose 2% to a seasonally adjusted annualized rate of 4.99 million in May from 4.89 million in April. It’s the highest sales pace since February.
Economists surveyed by MarketWatch expected sales to rise to 5 million.
…
Resales have sunk 15.9% in the past year and are down 31% from the peak in 2005. The pace of sales has been relatively stable since August at around a 5 million annual pace.
…
Inventories of unsold homes on the market fell 1.4% to 4.49 million, a 10.8-month supply at the May sales pace. The inventory figures are not seasonally adjusted. Inventories are up 2.4% in the past year.The median sales price in May was $208,600, down 6.3% compared with a year ago.
“It’d be premature to say the improvement marks a turnaround,” said Lawrence Yun, chief economist for the real estate group, which continues to advocate for congressional action to boost home buying, including a first-time buyer tax credit and higher loan limits for Fannie Mae and Freddie Mac.
From Bloomberg:
Sales of U.S. Existing Homes Rose to 4.99 Million Rate in May
Sales of previously owned homes in the U.S. rose in May from a record low, signaling depressed prices lured some buyers into the market.
Resales increased 2 percent to a 4.99 million annual rate, higher than forecast, from a 4.89 million pace in April, the National Association of Realtors said today in Washington. The median price dropped 6.3 percent from May last year.
A drop in property values may have spurred demand in some of the most distressed areas, such as California and the Midwest. Even so, rising mortgage rates, a glut of unsold homes, and stricter borrowing rules indicate the real estate recession will persist for most of the year.
“There’s going to be a little more adjustment until we can say the worst is over,” Michael Gregory, a senior economist at BMO Capital Markets in Toronto, said before the report. “If you don’t have the confidence of a job and banks are reluctant to lend money,” housing will stay weak.
Economists forecast home resales would rise to a 4.95 million pace, according to the median of 72 projections in a Bloomberg News survey. Estimates ranged from 4.75 million to 5.15 million.
April’s matched a record low for existing home sales.
Compared with a year earlier, sales were down 16 percent in May.
June 26th, 2008 at 6:01 am
Foist.?
June 26th, 2008 at 6:02 am
From the WSJ:
Bank of Congress
June 26, 2008; Page A14
“Hopefully, there will soon be no more Countrywide,” declared Barney Frank (D., Mass.) last week. Calling Countrywide “unusually sleazy,” the House author of Congress’s $300 billion housing bailout added: “Having Bank of America buy up Countrywide is a good thing for America.” Yesterday, Countrywide shareholders seconded that by approving the transaction.
Mr. Frank may be right about Bank of America’s better management, but there’s no doubt his legislation is very good for both Countrywide and BofA. Thanks to this bailout that is now on the Senate floor, taxpayers could end up on the hook for more than $25 billion in loans originated by Countrywide. We also know the race is on to see how many of these mortgage contracts will receive taxpayer refinancing before the law catches up with them. Yesterday, Attorneys General in Illinois and California sued Countrywide and CEO Angelo Mozilo for deceptive trade practices.
Suspicious Activity Reports filed with the Treasury’s Financial Crimes Enforcement Network show that mortgage fraud skyrocketed during the housing boom. What will take time is digging into individual mortgage contracts to uncover the extent of such fraud. But with an election in five months, Congress is determined to bail out irresponsible lenders and borrowers right away.
After making its loans, Countrywide sometimes held on to them but most often it sold them to others who packaged them into mortgage-backed securities (MBSs). And that’s also why Bank of America has so much at stake in the housing bailout. According to a recent JP Morgan report, Bank of America holds more MBSs than any other bank, and its $182 billion in MBSs is more than twice as much as second-place Wachovia. So yesterday’s Washington Post report that BofA helped to craft the bailout comes as no surprise. What is surprising is how many Senators still think this bailout is smart politics.
June 26th, 2008 at 6:05 am
From Bloomberg:
Citigroup May Write Down $8.9 Billion, Goldman Says
Citigroup Inc., the bank that’s posted the biggest losses from the collapse of the U.S. mortgage market, may take an additional $8.9 billion in net writedowns in the second quarter, Goldman Sachs Group Inc. said.
…
“The turnaround in business trends that we had been expecting in the second half of 2008 may not occur as quickly as we should have thought,” Goldman said. “We see multiple headwinds for Citigroup,” such as risks of further writedowns, higher consumer provisions, and the potential need for additional capital raisings, dividend cuts or asset sales, Goldman said.
June 26th, 2008 at 6:14 am
Not locally applicable, but further evidence of commercial loans impacting regional banks.
Fifth Third halts loans for commercial property
As one of Toledo’s largest investors in commercial real estate, with millions of dollars in retail and office properties, Harvey Tolson has been a loyal customer to Fifth Third Bank.
But when he approached bankers there this week about the possibility of financing a new venture, he was turned down flat.
“They told me they aren’t making commercial real estate loans at this time,” Mr. Tolson recalled.
The Cincinnati-headquartered bank, which competitors say provides up to $100 million annually in financing for apartments, offices, and other projects in the Toledo area, has stopped, at least temporarily, making most loans for the construction and purchase of commercial properties.
As part of an effort to contain problems with bad loans, Fifth Third “suspended all new developer and non-owner-occupied commercial property lending,” top corporate executives told investors in a presentation last week. A copy of the presentation was filed with the U.S. Securities and Exchange Commission.
June 26th, 2008 at 6:15 am
From Bloomberg:
Commercial-Mortgage Bond Sales May Reach 12-Year Low
Sales of bonds backed by commercial real estate loans may fall to the lowest level since at least 1996 as investor demand for the debt slumps.
Commercial-mortgage backed securities offerings dropped to $12.2 billion in the first half of the year, from about $137 billion in the same period of 2007, according to JPMorgan Chase & Co. Analysts at the firm, Moody’s Investors Service and Royal Bank of Scotland Group Plc cut their forecasts. JPMorgan predicts sales will fall to $20 billion this year from the record $237 billion in 2007 and the lowest since 1996.
The decline shows the Federal Reserve’s seven interest-rate cuts since September had limited success in reviving the market for securities derived from real estate assets after the collapse of subprime mortgage-related bonds. Banks and financial firms, reeling from $400 billion in writedowns and credit losses, are also less willing to make new loans.
June 26th, 2008 at 6:15 am
From the WSJ:
Countrywide’s Pressures Mount
Three States File Legal Actions; Holders Clear Sale
By RUTH SIMON
June 26, 2008; Page A3
The legal and financial pressures on Countrywide Financial Corp. mounted Wednesday as officials in three states filed separate legal actions against the mortgage lender.
The actions, by the attorneys general of California and Illinois, and the Washington State Department of Financial Institutions, came on the same day that Countrywide shareholders voted to approve the sale of the company to Bank of America Corp. The all-stock transaction was valued at $4 billion when Bank of America agreed to buy Countrywide in January. But Bank of America shares have since slipped, and the value has fallen to about $2.8 billion. The transaction is scheduled to close on July 1.
…
Litigation against Countrywide continues to pile up. In addition to the state cases, Countrywide and its top executives are under investigation by several federal agencies, including the Federal Bureau of Investigation and the Securities and Exchange Commission, and are the subject of numerous lawsuits from employees, shareholders and borrowers.
June 26th, 2008 at 6:17 am
From MarketWatch:
Lennar narrows loss, expects market to deteriorate further
Miami-based builder Lennar said its second quarter to May 31 loss narrowed to $120.9 million, or 76 cents a share, from $244.2 million, or $1.55 a share. Revenue fell 61% to $1.13 billion. The company said its loss includes a 60 cents a share charge on valuation adjustments and write-offs of option deposits. The value of its backlog is down 56% to $1.3 billion. The remainder of 2008 will likely see further deterioration in overall market conditions, it added. Analysts polled by FactSet Research expected a loss of 56 cents a share.
June 26th, 2008 at 6:18 am
Also from MW:
Lennar Q2 new orders down 45%, deliveries down 60%
June 26th, 2008 at 6:21 am
#2
“What is surprising is how many Senators still think this bailout is smart politics.”
There are 3 main types of fools. Idiots, morons, and Congressmen.
June 26th, 2008 at 6:24 am
From Bloomberg:
Housing Bill Delayed in Senate Over Energy Tax Cut Dispute
Passage of a bill that may reduce the number of housing foreclosures will probably be delayed in the U.S. Senate until next month after lawmakers were unable to resolve a dispute over whether to add energy tax breaks to the legislation, Senate Majority Leader Harry Reid said.
The measure stalled yesterday after Republican Senator John Ensign of Nevada demanded a vote on his amendment to provide almost $7 billion in renewable energy tax cuts. Under Senate rules, Democrats need the agreement of all 100 senators to wrap up work this week on the housing bill.
“In an election year, very few things are actually going to make it into law,” Ensign said. “So if you actually want to get something done, you need to be on that train that is basically going to be leaving the station. This housing bill has a great chance of being signed into law.”
The legislation includes a temporary program to offer insurance to struggling homeowners, a new regulator for mortgage buyers Fannie Mae and Freddie Mac, and funding for foreclosure counseling.
Reid, a Nevada Democrat, said yesterday that the Senate would take up the measure after a weeklong recess for the July 4 holiday.
June 26th, 2008 at 6:33 am
From MarketWatch:
Not clear why food, fuel costs spiked: Fed’s Kohn
The cause of the spike in food prices and energy costs this year remains a mystery, but the increases seen to date are not yet a full-blown emergency, Federal Reserve Vice-Chairman Donald Kohn told a German audience Thursday.
Speaking behind closed doors at the International Research Forum on Monetary Policy sponsored by the European Central Bank in Frankfurt, Kohn said higher headline rates of inflation popping up around the globe “have shown only a few tentative signs of embedding themselves in core inflation or in longer-term inflation expectations.”
But the No. 2 Fed official said central banks nonetheless “must monitor the situation carefully for signs that the increases in relative prices globally do not generate persistently higher inflation.”
June 26th, 2008 at 6:35 am
C’mon, Kohn was joking…
Right?
June 26th, 2008 at 6:38 am
From the Star Ledger:
Xanadu design is less than eco-friendly
In Syracuse, a megamall under construction will include its own windmills and solar panels. In Denver, an open-air mall runs a filtration plant that recycles rainwater for irrigation. In Savannah, a shopping center has a heat-reflecting roof and parking lots that let rain seep through pavement, reducing runoff.
Across the country, malls are starting to go “green,” saving money on energy and water while touting their environmental consciousness.
But when the $2 billion Meadowlands Xanadu shopping and entertainment attraction opens next summer as one of the nation’s biggest megamalls, it will have none of those features, according to the developers’ plans.
Despite a promise to explore eco-friendly alternatives, Xanadu did not incorporate some of the available technology that could have reduced its environmental impact.
With major construction work close to completion, the complex has no solar panels, nor do its designers have immediate plans to treat and recycle water, despite a state requirement to do so. The roof is a heat-absorbing black, instead of a reflective surface to help lower heating and cooling bills.
…
The DEP and the Meadowlands Commission initially planned to require Xanadu to obtain certification from the Leadership in Energy and Environmental Design program. The LEED program rates buildings for green elements such as energy and water efficiency, recycled materials and indoor air quality.
However, under Gov. James E. McGreevey, the state scaled back that mandate, instead urging Xanadu to use LEED and other environmental standards “to the extent practicable. “
June 26th, 2008 at 6:50 am
When is New Jersey going to start a bail out
for Cars, and credit cards?
After all , a welfare state must look after its residents..
all illegals can apply as well.
June 26th, 2008 at 7:00 am
“Citigroup May Write Down $8.9 Billion, Goldman Says”
That CAN’T be true!! bi (and S&P) said there would be no more writedowns!!!
June 26th, 2008 at 7:28 am
From CNBC:
Lennar Results Suffer in Housing Slump
Lennar, the second-largest U.S. home builder, Thursday reported a smaller quarterly net loss on lower expenses, but the results were worse than expected as deliveries and new orders tumbled.
…
Lennar Chief Executive Stuart Miller, citing rising foreclosures and unemployment along with sagging consumer confidence, said the industry needed government help.
“With the U.S. housing inventory growing in excess of absorption and limited credit availability, the prospect of further deterioration in the home building industry will likely become reality absent federal government action,” he said.
“We are hopeful that the federal government will acknowledge the need for further reform and will institute programs designed to stabilize and facilitate the recovery of the housing market,” he added.
June 26th, 2008 at 7:35 am
Way off topic -
That was my alma mater - Fresno State - just down the road a piece - that won the NCAA College World Series Baseball Championship last night (ESPN.) They came out of nowhere and beat Georgia in a 2 out of 3 game series. This is a team that wasn’t even seeded. The pitcher, Justin Wilson, went to Buchanan High….. the Clovis high school my elementary school feeds into. There were several other Clovis High players as well. Pretty proud day for those of us here in Clovis/Fresno.
You can even Wiki the details.
June 26th, 2008 at 7:38 am
“The turnaround in business trends that we had been expecting in the second half of 2008 may not occur as quickly as we should have thought,” Goldman said.”
[3],
What a freaking revelation. No sheet. This blog told you the same, 8-9 months ago. Why does anybody listen to these jesters?
June 26th, 2008 at 7:41 am
Cindy [17],
Congrats!! I love that team. Down to the wire 5-6 times and they escaped with the big one. Go Bulldogs! Enjoy your championship. You team is great, also very entertaining. The only problem, now that it’s over, I have to go back to watching the Yankees. Maybe I’ll just watch some recent Bergabe testimony.
June 26th, 2008 at 7:41 am
If Bank of America’s MBS book is the biggest in the US, how come Citi’s writedowns dwarf BAC’s? With 182 billion MBS book, I would thik BAC must have a lot of subprime, option arm, Alt A on its book. Yet not much in writedowns. What’s up with that?
June 26th, 2008 at 7:43 am
I would thik BAC must have a lot of subprime, option arm, Alt A on its book. Yet not much in writedowns. What’s up with that?
…waiting for Ginnie
June 26th, 2008 at 7:44 am
“In addition to the state cases, Countrywide and its top executives are under investigation by several federal agencies, including the Federal Bureau of Investigation and the Securities and Exchange Commission, and are the subject of numerous lawsuits from employees, shareholders and borrowers.”
[6],
Yes, the worm eventually turns.
June 26th, 2008 at 7:45 am
(19) BC Bob
I was hoping you caught a few games. I was in the NW for the majority of the series - just returned in time to see that playoff game last night. Man…what a story.
June 26th, 2008 at 7:45 am
#18 BC,
more importantly, why do people and firms pay them millions in fees to listen to their BS.
I love the Charlie Munger story when Berkshire bought a company and the company’s exec handed Munger a thick analysis of the company. Munger asked what this was. The company exec told him it was an analysis they had paid 2 million for. Munger pushed it back and told him we’ll pay you 2 million not to read it.
June 26th, 2008 at 7:47 am
BC Bob,
I think people feel they have to believe it if they are paying GS etc money to tell them such things. Kind of like a hooker telling a john he’s handsome:)
June 26th, 2008 at 7:54 am
“The cause of the spike in food prices and energy costs this year remains a mystery, but the increases seen to date are not yet a full-blown emergency, Federal Reserve Vice-Chairman Donald Kohn told a German audience Thursday.”
I just can’t take it. A mystery?
Can we just pull the plug on these liars. Real incomes are sliding down the slope of hope, food/energy cost are crippling the masses, consumer confidence is at WW2 lows, employment is declining and wealth is being destroyed. A mystery? Not an emergency? Do we wake up when crude is $200/barrel and gas is $8 a gallon? What does it take, a full blown revolution?
The real mystery is why M3 is no longer reported. Take that back, that’s clear as day.
Got Gold? That’s no mystery.
June 26th, 2008 at 7:56 am
jb,
26 in moderation. Probably offended the masters.
June 26th, 2008 at 7:57 am
“Munger pushed it back and told him we’ll pay you 2 million not to read it.”
bairen,
Great stuff.
June 26th, 2008 at 8:24 am
“C’mon, Kohn was joking…
Right?”
No. Ya see, we’d know if headline inflation was beginning to show up in core inflation if core inflation were as high as headline inflation.
It isn’t, and therefore it isn’t.
See how that works?
June 26th, 2008 at 8:25 am
FYI: May NJMLS Existing and Pending Sale Data for Bergen County
SFH, Condos/Co-ops, Townhouses
Year #Sold #U/C
1998 772 1040
1999 743 999
2000 786 977
2001 736 1075
2002 847 1022
2003 713 1030
2004 807 1072
2005 873 1149
2006 808 1050
2007 824 964
2008 539 772
June 26th, 2008 at 8:26 am
Bergen County keywords: Prestigious, Bubblewrapped, Wall St Bonuses, minutes from NYC, Blue Ribbon, enclave
June 26th, 2008 at 8:27 am
17 Cindy!!
Where ya been??
We solved the drilling off Florida issue awhile back.
June 26th, 2008 at 8:29 am
“Bergen County keywords: Prestigious, Bubblewrapped, Wall St Bonuses, minutes from NYC, Blue Ribbon, enclave”
IMMUNE
June 26th, 2008 at 8:30 am
Market futures look pretty bleak. Anyone know what is up?
June 26th, 2008 at 8:30 am
COMP KILLER OF THE YEAR!!!!
ALPINE NJ - PURCHASE PRICE 2006 $58 Million
2008 SALE PRICE $42 MIllion.
Spec House, owner built 30,000 square foot mansion to boot brand new. On top of $14 million dollar price cut!!!!!!!!!!!!!!!!!!
House is behind huge fence on popular road in Alpine. Can’t wait to see the RE taxes.
June 26th, 2008 at 8:30 am
CNN/Money:
Buffett v. Bernanke: Inflation showdown
8:08am: The billionaire investor says inflation is ‘exploding,’ but the Fed believes commodity price shocks should subside.
June 26th, 2008 at 8:31 am
who ya gonna believe? Warren Buffett or Ben Bernanke’s lying eyes?
June 26th, 2008 at 8:32 am
“Bergen County keywords: Prestigious, Bubblewrapped, Wall St Bonuses, minutes from NYC, Blue Ribbon, enclave”
tbw,
Rear view morror. Presently, WS depression.
June 26th, 2008 at 8:33 am
“Market futures look pretty bleak. Anyone know what is up?”
Gold.
June 26th, 2008 at 8:33 am
Goldman in London basically downgraded, GM, Citi lots of companies in the middle of night. I hate Goldman.
June 26th, 2008 at 8:33 am
The Rent Wars Return
http://www.nypost.com/seven/06192008/postopinion/opedcolumnists/the_rent_wars_return_116129.htm
Want to know what could happen to the Manhattan rental market over the next few years? Just look around.
In some neighborhoods, a dozen high-rise condo buildings are newly finished or under construction. But wait until dark and you’ll see that few lights are on in some new buildings.
Developers are finding it hard to sell as the market tightens - so they’re switching buildings to rentals.
On sites like Prudential Douglas Elliman, pages of “luxury” one-bedroom apartments, never lived in, are there for the taking. The market is in flux, with some owners thinking they’ll get $4,000 a month and others hoping to get $2,700 for near-identical apartments.
June 26th, 2008 at 8:34 am
Economy grew at 1% annual rate in the first quarter, according to a revised government figure. More soon.
June 26th, 2008 at 8:35 am
38 BC
too right!
June 26th, 2008 at 8:37 am
“The market is in flux, with some owners thinking they’ll get $4,000 a month and others hoping to get $2,700 for near-identical apartments.”
I’m placing my money on “others”.
June 26th, 2008 at 8:37 am
anybody have the condo, co-ops for passaic and essex?
June 26th, 2008 at 8:38 am
HEHE 25
A hooker is much more honorable then any investment bank as well as a true capitalist as opposed to government supported IB’s.
Please stop insulting all of those enterprising young ladies by comparing them to investment banks
June 26th, 2008 at 8:39 am
Harrington Park FUTURE Comp Killer!
182 SCHRAALENBURGH RD
Purchased $600,000 9/21/2006
MLS# 2825662
Listed 6/24/2008
OLP $579,000
June 26th, 2008 at 8:39 am
#29
sales down 35% year over year. I love it.
June 26th, 2008 at 8:41 am
#18 Love the quote. Judging from the pontifical tone, they must still think they matter. They don’t.
June 26th, 2008 at 8:43 am
Hillsdale FUTURE Comp Killer!
260 MAGNOLIA AVE
Purchased $510,000 10/2/2007
MLS# 2825778
Listed $499,999 6/25/2008
June 26th, 2008 at 8:44 am
Keep ‘em coming Rich.
Just make sure my house isn’t on the list ;)
June 26th, 2008 at 8:44 am
From MarketWatch:
GDP revised to 1.0% in first quarter
The U.S. economy grew at a slightly faster pace in the first quarter while inflation also was stronger than estimated, the Commerce Department said Thursday in its final revision to gross domestic product estimates.
…
The nation’s real gross domestic product was revised up a tenth of a percentage point to a 1.0% annual rate in the first three months of the year. The revision was slightly below the consensus expectation of economists surveyed by MarketWatch.
The mildly stronger-than-expected report is not expected to have much impact on financial markets.
…
Core consumer price inflation rose at a 2.3% annual rate during the quarter, up from the previous estimate of a 2.1% rise. Core inflation has risen 2.0% in the past year, at the high end of the Fed’s comfort zone.
June 26th, 2008 at 8:45 am
From MarketWatch:
U.S. weekly initial jobless claims unchanged at 384,000
U.S. 4-wk. avg. initial jobless claims up 2,250 to 378,250
U.S. continuing jobless claims rise 82,000 to 3.14 mln
U.S 4-wk. avg. continuing jobless claims rise to 3.10 mln
June 26th, 2008 at 8:45 am
Rich in NNJ-
Hey, I lost your email!. I’d love to chat about BC and get your take on towns.
JM
June 26th, 2008 at 8:46 am
“Please stop insulting all of those enterprising young ladies by comparing them to investment banks”
kettle,
I agree. No need to open the window, just sit at the window and turn on the red light.
No trash for cash here.
June 26th, 2008 at 8:46 am
Buyers shying away from GE’s credit card business: WSJ
http://biz.yahoo.com/rb/080625/generalelectric_creditcards.html?.v=1
“Prospective buyers are afraid that customers of stores like Wal-Mart Stores Inc (NYSE:WMT - News), J.C. Penney Co (NYSE:JCP - News) and Lowe’s (NYSE:LOW - News) are having trouble paying their bills, said the report.”
Seems like the personal CC crunch is almost upon us, no?
June 26th, 2008 at 8:47 am
Mahwah FUTURE Comp Killer!
290 MILLER RD
Purchased $540,000 9/30/2004
MLS# 2825724
Listed $529,000 6/25/2008
June 26th, 2008 at 8:47 am
Everyone pre-purchasing winter oil/Natural gas??? On a serious note if you have older family members, look into whether they are going to be able to cover heating this winter, prices are likely to spike higher then most would suspect or believe.
Vectren Ohio issues early warning
for winter heating bills:
Although the winter heating season is more than four months away, Vectren Energy Delivery of Ohio (Vectren) is already undertaking proactive steps to encourage customers to prepare now given the natural gas commodities market for the 2008-2009 winter heating season is pointing to much higher prices than last winter.
Year-round demand on natural gas, spurred from an increase in the use of natural gas to produce electricity, continues to force prices higher. In fact, the prior winter heating season saw market commodity prices that averaged about $8 per dekatherm, and the forecasted 2008-2009 heating season has prices hovering well above $12, according to the New York Mercantile Exchange monthly settlement futures prices. Because the cost of natural gas is passed on to the customer on a dollar-for-dollar basis, customers will be faced with these increased costs in the coming months.
June 26th, 2008 at 8:48 am
Bklynhawk,
I’ll email JB asking him to forward my email.
Rich
June 26th, 2008 at 8:49 am
From Bloomberg:
Brunswick to Shut Boat Plants, May Fire 2,700 Workers
Brunswick Corp., the maker of bowling equipment and recreational boats, plans to close 12 plants and said it may fire as many as 2,700 workers after U.S. power-boat sales fell to the lowest in more than 40 years.
June 26th, 2008 at 8:50 am
Quick Bennie cut! Must be a rogue trader on the futures market.
June 26th, 2008 at 8:52 am
Kettle,
You are right. I apologize to all the NYC area working girls for besmirching their names.
June 26th, 2008 at 8:52 am
Hillsborough OKs resolution in fight against new affordable-housing rules
HILLSBOROUGH —Township Committee members want to engage in what they describe as a “two-front war” on affordable housing.
Fed up by the Council on Affordable Housing’s new rules for municipalities to deal with state-mandated affordable-housing requirements, municipal officials have joined the state League of Municipalities’ potential legal challenge.
The new rules call for Hillsborough to add 580 new homes by 2018.
“This action is necessary in order to protect our community from overdevelopment and the so-called builders’ remedy, that would allow thousands of market rate units and hundreds of COAH units to be developed without regard to local zoning regulations,” Mayor Anthony Ferrera said in a statement before the meeting.
June 26th, 2008 at 8:54 am
“Seems like the personal CC crunch is almost upon us, no?”
stu,
It was a crunch about 6-8 months ago. It has recently been upgraded to a category 5, credit crash.
June 26th, 2008 at 8:55 am
SG,
Something I don’t understand here, why not just back out of COAH and attempt to fight builders remedy in court?
June 26th, 2008 at 8:55 am
“Quick Bennie cut! Must be a rogue trader on the futures market.”
JB,
He doesn’t need any help. That depression brain cramp is growing.
June 26th, 2008 at 8:55 am
Royce Brook Golf Course housing plan set for review
HILLSBOROUGH —A controversial plan to build 1,500 housing units at the Royce Brook Golf Course is scheduled to go before the township’s Planning Board for review.
June 26th, 2008 at 8:56 am
question for the group….
IF we enter a true depression, will the banks try to repossess homes en mass like the banks tried to repossess farms in the 30’s? or will the numbers be so large that people are left alone to live rent free? or will the public outcry be loud enough that the government would step in and prevent mass repossession
June 26th, 2008 at 8:56 am
(33) njpatient
I was in the Pacific NW for a few weeks (the minute school let out) to see the daughters and grandkids. I haven’t read the site for weeks so when you say “We solved the drilling off Florida issue awhile back” I’m clueless. Can you elaborate just a bit?
June 26th, 2008 at 8:57 am
“Brunswick to Shut Boat Plants, May Fire 2,700 Workers”
Hate to see workers lose their jobs. That said, it has been a great ride. The best stock symbol on the market today.
June 26th, 2008 at 9:01 am
#67
“IF we enter a true depression, will the banks try to repossess homes en mass like the banks tried to repossess farms in the 30’s?”
Congress is already trying (and seems likely to succeed) to bring a huge number of loans onto the gov’ts books. I would think that we will never see mass foreclosures since the gov’t will simply step in and buy up mortgages.
June 26th, 2008 at 9:03 am
“Brunswick to Shut Boat Plants, May Fire 2,700 Workers”
Little tid bit from my corner of the world, there’s been a big drop in advertising in boating and sailing magazines in the last year. Unfortunately for the people who work at these companies, we’ll see more manufacturers throwing in the towel or severely cutting back operations.
June 26th, 2008 at 9:03 am
76 Kettle
The will repo because then they can sell to the new land owner class. Who will then be able to consolidate vast holdings of rentable property.
You have to live somewhere.
June 26th, 2008 at 9:06 am
bairen, #20
B of A exited the subprime business pre-bubble - around 2001.
Their exposure is in the other categories.
June 26th, 2008 at 9:07 am
Global real estate to stay a wild ride: Pralle
NEW YORK (Reuters) - For commercial real estate investors, Brazil is a dream and Spain is a nightmare, Michael Pralle, president of real estate private equity firm J.E. Robert Cos, said on Wednesday.
“I’d avoid Spain and Italy right now, and be patient in the United States,” Pralle said at the Reuters Global Real Estate Summit in New York. “It’s going to get worse before it gets better.”
About 70 percent of its investments currently are in the United States, but it expects that to drop to 50 percent within three years, he said.
U.S. commercial real estate prices are off about 5 percent from this cycle’s peak last year, and many experts believe that by the time it’s all over, the plunge will be 15 to 20 percent.
June 26th, 2008 at 9:07 am
Cindy - Congrats on your team.
How was your trip to visit your daughters?
June 26th, 2008 at 9:09 am
#67
“If we enter a true depression, will the banks try to repossess homes en mass like the banks tried to repossess farms in the 30’s?”
During the great depression, the income gap was significantly smaller, yet the top income earners paid a 90% income tax rate to fund the huge government programs that built many of our parks, dams, bridges, tunnels, highways and other infrastructure. Don’t see it happening this time around. Just the talk of letting the Bush tax cuts expire have people threatening to jump off bridges in protest. The way I see it, the government will just increase the debt to a level so high that the dollar truly becomes worthless and that would be the end of our dynasty as no one would be willing to buy our debt. At current debt levels, we still have a chance of digging ourselves out of the holes, but it would require some hefty tax increases to do so. This of course, won’t happen. Let’s all hope we don’t enter a depression!
June 26th, 2008 at 9:09 am
Grim: Something I don’t understand here, why not just back out of COAH and attempt to fight builders remedy in court?
I agree with you 100%. The argument I have heard is they will be open to Builder’s lawsuit.
June 26th, 2008 at 9:09 am
The avergae mortgage default rate in 2000 was 7% it is currently expected to hit 25%+. So if we assume that Credit Cards will see a similar trend (the default rate almost quadrupling), then the 2004 CC default rate of 7% could shoot up to about 25% as well.
Current US Credit card debt is about 300 billion. SO the Credit card companies could be looking at “write downs” of 75 billion dollars and a collapse of the consumer credit industry, as no one will give out lines of credit at that point with a pound of flesh to back it up.
buckle your seat belt
http://tinyurl.com/2uryqo
PS these numbers are all WAG’s (Wild A$$ Guesses) and could be flat out wrong, BC/ ChiFi or others may want to correct me
June 26th, 2008 at 9:10 am
My problem with Hillsborough and COAH is that they cry “overdevelopment” over 500 COAH units but have no problem building THOUSANDS of other units.
Methinks they doth protest too much.
How about they just meld that 500 into the other thousands they actually want to build and then development will remain at the same level?
Or perhaps they don’t want to rub shoulders with just moderate income people? Not so long since Hillsborough was pretty blue collar. Getting a little uppity these days.
June 26th, 2008 at 9:10 am
“U.S. commercial real estate prices are off about 5 percent from this cycle’s peak last year, and many experts believe that by the time it’s all over, the plunge will be 15 to 20 percent.”
I can handle a 30 to 40 percent gain in my CRE ultra short.
June 26th, 2008 at 9:11 am
Fresno Bee today…”Home sales statewide surged in May for the second consecutive month as buyers capitalized on low prices and ample supply.”
Sales of new homes continued to struggle, but sales of existing houses climbed 15.5% from the previous month and 18.1% from May of 2007, topping 400,000 for the first time since early last year, the California Association of Realtors reported Wednesday.”
“The prices have dropped and the market is reacting to it,” said John Shamshoian, owner of Realty Concepts, a Fresno residential real estate firm.” Realty Concepts had record transactions in April of 118, while May’s 123 deals were double a year earlier and nearly a record, Shamshoian said.”
In Fresno and Clovis sales of existing homes climbed 19% month-to-month and year-over-year.”
June 26th, 2008 at 9:11 am
GS strongly recommended that investors sell shares of Citigroup Inc. (C), saying it faced multiple problems, including more asset write-downs, higher loss provisions for consumer credit, and the potential for more capital raises, dividend cuts or asset sales.
Shares of Citigroup fell 4.8% to $17.95 in premarket trading. A Citigroup spokeswoman said the company doesn’t comment on analyst reports.
June 26th, 2008 at 9:13 am
Premarket indicators continue to plummet!
http://dynamic.nasdaq.com/asp/PMI.asp
June 26th, 2008 at 9:14 am
actually, this may be more representattive of our current situation.
http://tinyurl.com/3zta6q
Cindy,
The “chinese drilling off of florida” was all BS meant to stir the political pot.
“Vice President Dick Cheney has issued a statement to Associated Press backing off his claim that China was drilling 60 miles off the Florida coast:”
June 26th, 2008 at 9:15 am
Headlines from Yahoo Finance:
Sure doesn’t look like a turnaround in the 2nd half of 2008!
* 1Q GDP Revised Up, but Growth Still Subpar- AP
* Jobless Claims Hold Steady- AP
* Fed Signals Aggressive Rate Cutting is Done- AP
* Lennar 2Q Loss Narrows; Sees Worsening Conditions- AP
* Stocks Head for Lower Open After GDP Reading- AP
* Oil Prices Rising After Steep Fall- AP
* Goldman Puts Citigroup on ‘Conviction Sell List’- Reuters
* Goldman Cuts GM, Other Auto and Parts Cos.- Reuters
* Discover Profit Rises on Higher Card Use- AP
June 26th, 2008 at 9:16 am
(75) lisoosh
Excellent trip - miss them all BUT I need to rest up from playing 24/7 with a 2 and 3 year old. Man! Bless all of you who try daily to keep up with them and meet their needs!
June 26th, 2008 at 9:16 am
The worst is yet to come from credit crisis and real estate bubble
Talcott Franklin, co-author of the “Mortgage & Asset Backed Securities Litigation Handbook,” says that the credit crisis and real estate bubble has barely scratched the surface and will get much worse before there is any improvement. In a radio interview, Franklin described the current situation as “the Mount Everest of housing bubbles,” and noted that recovery from the last big real estate bubble - caused by the savings and loan crisis of the 1980s - took 10 to 14 years, and how the current situation may take even longer to bounce back.
June 26th, 2008 at 9:16 am
#73 scribe
Thanks for the info.
June 26th, 2008 at 9:17 am
#76
so our choices are either (1) confiscatory tax rates or (2) massive dollar devaluation.
what about letting the market correct? I guess that would be too straightforward and fair.
June 26th, 2008 at 9:17 am
Is it time to assume that what ever GS is publicly suggesting is the opposite of what they are doing? for that matter does Bi work for GS? that would make a lot of sense……
June 26th, 2008 at 9:17 am
Friend just took a job at Fannie Mae. Should he be worried?
June 26th, 2008 at 9:19 am
Only if he has an aversion to pitchforks and torches.
June 26th, 2008 at 9:20 am
(84) Kettle1 - Thanks re drilling.
June 26th, 2008 at 9:20 am
Wyckoff FUTURE Comp Killer!
727 MOUNTAIN AVE
Purchased $562,500 8/15/2006
Current MLS# 2825519
OLP: $619,900 3/19/2007
LLP: $549,900 6/24/2008
June 26th, 2008 at 9:22 am
#82
John,
Do you think GS is short CITI before they made these pronouncements? I can’t stand this BS. These investment banks should be required to reveal all the positions they have on a stock or commodity when they release their opinions.
June 26th, 2008 at 9:22 am
Nearly 20 real estate agents walked through the wooden double doors of a $2.85 million house this week, but they weren’t there to make a deal.
They came to meditate.
Illustrated Properties of Palm Beach Gardens brought in meditation specialist Mordy Levine to teach agents how to manage stress, an increasingly helpful skill as South Florida’s housing slump rolls through a third year with no clear turnaround in sight.
http://www.sun-sentinel.com/business/sfl-flzmeditation0626sbjun26,0,2306749.story
June 26th, 2008 at 9:27 am
Here’s some examples of why we are all buggered.
Two of my relatives are concerned with peak oil and global warming. So what do they do to help out?
One buys a frigging Winnebago with gas around $4 a gallon to cruise around the US. Every 300 miles he is consuming a barrel of oil.
The other buys a 5,000 sq ft house connected to the grid. If it was off the grid and powered by wind/solar and reusing rain water I wouldn’t be so annoyed.
But it’s OK. Sometimes they bring reusable bags to the grocers and they donate $3 on their tax return to conservation. Plus $20 a year to the Sierra Club.
June 26th, 2008 at 9:27 am
Couples Swap Homes, Avoid Real Estate Woes
PHOENIX — As the housing crisis continues, two couples in Arizona found an easy way to sell their homes: they traded them.
“This really just started out as such an incredibly bizarre situation,” Lisa Blank said.
June 26th, 2008 at 9:30 am
Bernanke needs to drop rates another 50 basis points to provide more stimulus, don’t you agree? We’re a consumption nation, it’s what we do best. Forget all this other nonsense about getting back to business the old way, this is our business. Lease an i series, go on vacation three times a year, purchase the latest flat screen on an annual basis… this is where it’s at. We’re entitled, you know.
June 26th, 2008 at 9:32 am
In this economic climate, anybody who buys a Winnebago (a whole herd of Winnebagos, they’re giving ‘em away!)…..should have their sanity checked.
June 26th, 2008 at 9:35 am
How much does a Winnebago go for nowadays?
June 26th, 2008 at 9:35 am
#97 gary,
He should cut 300 basis points so fed funds is negative and charge savers 1% for keeping money in banks. Think of the boom we would get as people emptied their meager savings and cd accounts and bought stuff. Flat screens and granite for everyone!!!!!
Cause we are entitled to it you know.
June 26th, 2008 at 9:37 am
The Credit Crunch Still Bites
There are 4 million homes on the market and 2 million of them are vacant with practically no sales activity. My brother-in-law, who lives in a major retirement community in central Florida, tells me nothing is moving in his 60,000-unit middle-class development. Nobody gets out in one piece.
From their peak, home prices have declined about 18%. Consider that half of family net worth is tied up in real estate, and the other half is financial assets. Individual net worth topped out a year ago at $60 trillion. Now I estimate that we’re closer to $55 trillion, and that could easily drop to $50 trillion before the bottom is plumbed.
June 26th, 2008 at 9:37 am
I think he paid around 100k. Bought a new one cause they didn’t want a used bathroom. Could have bought a 2 year old one for 25 to 30k less and redone the bathroom for 5k or so.
As I said. We are buggered.
June 26th, 2008 at 9:38 am
bairen,
Can I purchase a granite house? lol!
June 26th, 2008 at 9:39 am
Fiddy,
i dont know, a winnibego could be the housing of the future!!! a home that doesnt have to worry about property taxes!!!!
June 26th, 2008 at 9:39 am
“Couples Swap Homes, Avoid Real Estate Woes”
Probably easier/cheaper to just swap partners?
June 26th, 2008 at 9:40 am
“Can I purchase a granite house? lol!”
You realize, that you would have to have butcher block countertops in the kitchen then!
June 26th, 2008 at 9:40 am
68 cindy
“I haven’t read the site for weeks so when you say “We solved the drilling off Florida issue awhile back” I’m clueless. Can you elaborate just a bit?”
Cheney had to publicly admit that he was full of crap on this one. It was very embarrassing for him.
June 26th, 2008 at 9:40 am
I will only consider a winnebago if it has granite counter-tops!
June 26th, 2008 at 9:41 am
“i dont know, a winnibego could be the housing of the future!!! a home that doesnt have to worry about property taxes!!!!”
I like a house boat. With sea levels rising, the masses will really be underwater.
June 26th, 2008 at 9:41 am
#103 gary,
Sure. It’s called a cave. Just head for the hills and stake your claim.
They’re not making any more caves you know.
June 26th, 2008 at 9:43 am
BC
“Probably easier/cheaper to just swap partners?”
now you’re going to have to explain Fritz Peterson and Mike Kekich to the youngsters.
June 26th, 2008 at 9:45 am
Barien
You describe one of the biggest problems. Even a lot of the people wo are even aware of peak oil have no real idea of its implications. very few peopel realize that the first place that will take a hit due to oil is food. hence all the headlines of food aid groups running dry, and commodity prices sky rocketing. The difference is that most people in the US can absorb the price increase for now. Collapse of the global megafarm food production/distribution model is what will be the 1st catastrophic impact of peak oil.
corporate megafarms will still be around but the global apsect will collapse as will small scale private farms due to fuel/fertilizer costs. the mega farms will be able to utilize economies of scale and have the corporate power to push prices onto consumers while small and private farms will not.
June 26th, 2008 at 9:46 am
bairen,
Agreed! Especially if the cave is in the Ramapo hills because it’s part of prestigous Bergen County. And I heard the value of caves only goes up! My neighbors’ friends’ son-in-laws’ step Mom said it… because she knows someone who just passed the realtor exam after three tries. In fact, I think Graydon and his sister and his Mom are moving there after the settlement.
June 26th, 2008 at 9:46 am
http://www.thedigeratilife.com/blog/index.php/2007/09/18/12-ways-to-beat-inflation-dont-let-rising-prices-get-you-down/
Cash is Trash.
June 26th, 2008 at 9:47 am
CENTRAL CALIFORNIA HOUSING CRASH
June 26th, 2008 at 9:47 am
Stu,
I’ll just refi to get the butcher block installed.
June 26th, 2008 at 9:48 am
Is it just me, or do RVs seem like a particularly reckless use of energy?
Do these things even exist anywhere in the world, or is this a uniquely American concept. Europeans hike around with backpacks, Americans take their entire home with them.
Let me get this straight, we’re going to build a house, and put it on wheels, so that you can drive a house across country consuming prolific amounts of fuel along the way?
Good lord.
June 26th, 2008 at 9:49 am
#112 kettle,
What impact is the higher costs of fuel having on organic farmers? Supposedly they don’t use artificial fertilizers.
June 26th, 2008 at 9:50 am
110 bairen
actually they are making more caves!!!
Davis Caves Earth-Sheltered Home
http://www.daviscaves.com/index.shtml
June 26th, 2008 at 9:50 am
grim Says:
June 26th, 2008 at 9:48 am
Is it just me, or do RVs seem like a particularly reckless use of energy?
Grim: head down to a big time SEC football game this fall, your head will explode.
June 26th, 2008 at 9:51 am
115 SG
Those people complaining that they spent $600K for a house and now the developer is auctioning the same place next door for $300K can go f themselves.
June 26th, 2008 at 9:51 am
grim [117],
We’re entitled. This is America, you know.
June 26th, 2008 at 9:53 am
“Is it just me, or do RVs seem like a particularly reckless use of energy?”
How ’bout Nascar events attended via RV?
June 26th, 2008 at 9:53 am
njpatient [121],
Wow, you sound like me!! :) They’re all a bunch of nars.
June 26th, 2008 at 9:53 am
“We’re entitled. This is America, you know.”
We are NOT going to change our standard of living!
June 26th, 2008 at 9:54 am
Gary (116) says: “I’ll just refi to get the butcher block installed.”
Now that the Fed has stopped cutting, now may be the best time to refinance before interest rates are no longer at their historic lows.
Next month:
Now that the Fed has stopped cutting, now may be the best time to refinance before interest rates are no longer near their historic lows.
June 26th, 2008 at 9:54 am
Comp killer in Washington Township (Bergen):
MLS #2811406
Started out at $434,900.
Dropped to $429,900.
Dropped to $419,900.
Not at $399,900.
At least this one is nicely kept up with some updating. Other capes in neighborhood with NOTHING done to them at all are still listed in the $415K - $419K range.
June 26th, 2008 at 9:54 am
#123
NJP, same crowd as the SEC game… that way they get use of the RV year-round.
June 26th, 2008 at 9:54 am
#117 grim,
They have rvs in Australia. Not to the extent we have them over here.
I’m fuming at my relatives. People are starving from the skyrocketing cost of food caused by the increase in energy. Yet at the same time others knowingly grossly over consume. I’m like, how many people will die from starvation or the elements so you can sit in your 1,000 sq ft media room with stadium seating?
June 26th, 2008 at 9:54 am
“They’re all a bunch of nars.”
Nars to the left of me, nars to the right, here I am, stuck in the middle with gary
June 26th, 2008 at 9:55 am
118 bairen
the organic farmers are being hurt as well. This is because as fertilizer becomes more expensive and organic becomes more popular, demand for organic fertilizer is increasing. Not nearly as much as petro based fertilizer but there is still pain. Also you will have lower yields with organic fertilizer as you can/are not “force feeding” the crops. This means that the unit cost of the crop sold at market is higher without necessarily increasing your profit margin
June 26th, 2008 at 9:57 am
The govt actually encourages those bozos to buy those damm RVs as the interest on the loan is taxable dedutable as it is considered a second home.
June 26th, 2008 at 9:59 am
132 john
I did not know that.
That’s disgusting.
June 26th, 2008 at 9:59 am
You people are all just a bunch of jealous wannabe renters who live in dirty squalor! Humph!
June 26th, 2008 at 9:59 am
http://www.marketwatch.com/tools/quotes/intchart.asp?symb=XLF&sid=127183&dist=TQP_chart_date&freq=1&time=8
June 26th, 2008 at 10:01 am
by the way with the FDA’s recent classification or the term “organic” as applied to food, it is very difficult to now determine whether a food is actually organic. according to the new rules as long as a certain % of the food is/was organic then the entire product may be labeled organic even if pesticides and other nasties were used in it.
Unless you know the source and trust it all organic is now is a premium label to bolster the Cargill’s of the world
June 26th, 2008 at 10:02 am
Squalor is Prime!
June 26th, 2008 at 10:03 am
From MarketWatch:
U.S. May existing-home sales rise 2% to 4.99 million pace
U.S. May existing-home inventory falls to 10.8 month supply
U.S. May existing-home median price down 6.3% in past year
U.S. existing-home sales down 15.9% in past year
June 26th, 2008 at 10:03 am
“now you’re going to have to explain Fritz Peterson and Mike Kekich to the youngsters.”
njp,
Haven’t heard those names in awhile. Dogs and kids, also.
June 26th, 2008 at 10:04 am
SG :118
Did the lady in that video actually say, “I feel like my parents grave has been robbed”??
June 26th, 2008 at 10:04 am
“You people are all just a bunch of jealous wannabe renters who live in dirty squalor!”
Great to hear wannabe’s again. I thought all the barkers were flattened by a Mack truck?
June 26th, 2008 at 10:05 am
From MarketWatch
U.S. May existing-home sales rise 2% as expected
The U.S. home and condo resales inched higher in May as prices continued to fall, the National Association of Realtors reported Thursday. Resales of U.S. houses and condos rose 2% to a seasonally adjusted annualized rate of 4.99 million in May from 4.89 million in April. It’s the highest sales pace since February. Economists surveyed by MarketWatch expected sales to rise to 5 million. Resales have sunk 15.9% in the past year and are down 31% from the peak in 2005. The median sales price was down 6.3% compared with a year earlier. Inventories of unsold homes fell 1.4% on a not-seasonally adjusted basis to 4.49 million, a 10.9-month supply.
Emphasis added
June 26th, 2008 at 10:05 am
How well are train towns in NJ going to hold up vs. those not on train lines?
I read yesterday that CS futures predict a 25% drop in the NYC market by mid 2010, which is mind-blowing.
Will the easier, cheaper and “greener” access to NYC insulate places a little bit like Maplewood/S. Orange versus somewhere like Verona? If so, to what degree?
June 26th, 2008 at 10:09 am
seeking,
Your black box is missing two critical variables, top schools and high incomes (Snootyville, Haughtyville, etc).
Those, along with the train access you mention (midtown direct, preferrably) are the key traits of a handful of markets that continue to hold strong. I wouldn’t classify SO or Maplewood as part of that group.
Remember, Paterson has train access too.
June 26th, 2008 at 10:11 am
Nasdaq off by 2%
June 26th, 2008 at 10:12 am
Oh, it seems the masses have figured out that Ben can’t raise rates cause he has a boat load of Arms and other toxic stuff on his Balance Sheet so everyone is fleeing back to GOLD.
Welcome back sheep as you have increased the price og Gold by $26 today. Tommorrow please invite your friends and lets become Gold bugs together.
June 26th, 2008 at 10:14 am
Re: 41
I’m not convinced that deregulation alone would result in the construction of more affordable housing in NYC.
If that were true, we would see more in less regulated places like Northern NJ.
But all of the new construction seemed to be McMansions or luxury condos, for the simple reason that this was more profitable at the time.
There needs to be some incentive to build affordable housing, so we don’t wind up with inventory lopsided on the high end.
June 26th, 2008 at 10:17 am
“Tommorrow please invite your friends and lets become Gold bugs together.”
Make,
No, too soon. We want them to jump on board when it’s much higher. After all, we will need to sell to the late comers?
June 26th, 2008 at 10:20 am
Is there a way to short the U.S. government?
June 26th, 2008 at 10:20 am
[121] I have to agree. Its unfortunate that they are in the position that they are in, but they have no one to blame but themselves - no one forced them to pay 597K.
You know, come to think about it, I feel betrayed by Citi. I bought that stock years ago at a much higher price and now, someone can buy a share for 17.88. Is the government going to buy it back from me for $55?
June 26th, 2008 at 10:21 am
stu [152],
GS is already doing it. :o
June 26th, 2008 at 10:26 am
#79 lisoosh
I’m a life long Hillsborough resident, all 25 years I’ve been alive. And I can’t stand the massive influx of McMansions and the high and mighty, entitled, Lexus SUV driving boneheads that came with them. This town used to be a blue collar farming and labor town. Now it’s all these freaking yuppies that can’t control their drug addict kids. It’s absoluty sickening the type of people that have moved here and ruined this town.
I would love nothing more than to see a tornado rip through that eye sore of a development that Toll put up on New Center and Beekman. As far as I’m concerned, anybody that bought those $800k pieces of junk are absolute fools. For over 3/4 of a million, I wouldn’t want to even be able to see a neighbor, let alone be able to throw a wiffle ball out my window and hit their house. Oh, and for that kind of money, I better damn well be able to put in a pool or park a boat in my driveway, unlikes these morons.
And then you have the guy who’s house mysteriously burned down on New Amwell road and he replaced it with this monstrosity that spans from property line to property line on a road full of 50’s style ranches and split levels. And there’s also that piece of excess that was built across the street from the high school and another wanna-be-baller estate on Hillsborough road. I really hate what is happening to this town.
June 26th, 2008 at 10:26 am
The 30-year fixed-rate mortgage rate average was 6.45% with an average 0.6 point for the week ending June 26. Last week, the average was 6.42%, and in the year-ago period it was 6.67%. Freddie Mac said the last time the 30-year rate average was higher was the week ending Aug. 23, 2007, when it averaged 6.52%.
June 26th, 2008 at 10:28 am
Anyone enjoy the discussion of the latest NIE on climate change??? Mass population shifts, food shortages, sea level rise and failed countires all by 2030
STu,
do you realize you have now been put on a watch list for suggesting that we all short the US gov?
June 26th, 2008 at 10:28 am
Grim,
Then what kind of slide do you see in Maplewood/S. Orange? Comparable to everywhere else?
And what places will maintain some price stability, in your opinion?
thanks.
June 26th, 2008 at 10:30 am
Woodcliff Lake FUTURE Comp Killer!
212 GLEN RD
Purchased: $838,000 8/8/2006
Current MLS#: 2825921
OLP: $829,000 5/1/2008
LLP: $799,000 6/26/2008
June 26th, 2008 at 10:33 am
Stu # 80
can you tell me which ETFs/MFs short CRE?
June 26th, 2008 at 10:35 am
2d Amend rights clarified today:
Justice Antonin Scalia, writing for four colleagues, said the Constitution does not permit “the absolute prohibition of handguns held and used for self-defense in the home.”
June 26th, 2008 at 10:36 am
$19.5 Million Hamptons Mansion In Foreclosure
Shelly Banjo reports:
The foreclosure mess is casting a shadow over New York’s Hamptons this summer. One result: An 18,000-square-foot Bridgehampton home has been reduced from its $27 million asking price to “just” $19.5 million.
The Bridgehampton mansion, which was built by Burns Development Corp., on more than 4 acres of land, played host to the 2006 Hamptons Designer Showhouse, an annual event where notable interior designers outfit a Hamptons home, showcasing trends in luxury home design to potential clients. The home, which features a pond, five-person elevator and something called ‘a flower-cutting room,’ went on the market once the showcase was over. But late last year a foreclosure notice was filed against the property’s $4.4-million mortgage.
New York’s Corcoran Group holds the listing for the 8-bedroom, 9 1/2-bath house and would not comment. (See a virtual tour of the home, hosted by Michael Burns of Burns Development.)
“We’ve seen a significant increase in million dollar-plus homes being offered to us, where before we almost never saw houses at this level,” says Jacob Benaroya, president and managing partner of Biltmore Capital Group, a New York-based firm that purchases problem loans from mortgage lenders. Although Mr. Benaroya has no connection to this Hamptons mansion, his firm deals with other properties in the area.
But “this type of specialty home” is harder to sell, he adds.
In the first three months of this year, banks launched preliminary foreclosure actions against a record 120 borrowers in the towns of East Hampton and Southampton, according to a recent article in the New York Post.
Other Hamptons high rollers mentioned in the NY Post include Janice Becker, a regular on the Southampton village social circuit who is facing foreclosure on her multimillion-dollar Wyandanch Lane property and advertising veteran Ransel Potter who is defaulting on a $1.8 million mortgage on an Amagansett parcel.
“These high-end areas were thought to be immune to foreclosures…but we’ve now seen that being wealthy doesn’t preclude you from being stupid with your money,” Mr. Benaroya says.
Permalink | Trackback URL: http://blogs.wsj.com/developments/2008/06/26/195-million-hamptons-mansion-in-foreclosure/trackback/
June 26th, 2008 at 10:36 am
[from yesterday's thread]
Patient,
Thought you were going to Philly? Course, we do have a Philly office, but we already have a tax/comp/bene assoc. and he doesn’t like competition from ivy leaguers that are smarter than him.
Kettle1,
Problem with the Costa Rican compound idea is that it is hard to use on weekends, or to get timber or vegetables to bring to the suburban/urban home. Also harder to get to in the event of a true emergency. More like a retirement escape.
The idea is not simply survivalist, urban meltdown living, but to have a usable, productive location that serves several purposes and provides an income stream to offset costs. Unless the U.S. radically rearranges the tax system, you can live off-the-grid right here in the U.S.
This holding can also be combined with certain aggressive tax positions that rely on offshore entities structured to avoid the FPHC or PFIC regulations to provide tax benefits as well. Still working on this last aspect—may be too aggressive.
Still, the idea translates well enough to Costa Rica, you just have to find the right property at the right price, and have a sufficient number of investors to make it worthwhile on the cheap (and avoid the aforesaid tax regulatory schemes).
June 26th, 2008 at 10:38 am
now, now,now. Let’s place nice and don’t knock RVs. I have a small metzendorf trailer from the 1960’s that I bought for $700.00 that I tow with my Jeep wrangler. It is small, comfortable, and I admit it has its problems.
Gas prices being what they are, I will still take the trailer for a 10 day camping trip. However, it will be closer to home. I have to wait till the “little guy” is older so he can appreciate Arcadia National Park in Maine.
The trailer does not have all the creature comforts, ie., air-conditioning, TV, ect., but as my wife says “if you are going to camp, then camp. If you want TV and air-conditioning, stay home!”
June 26th, 2008 at 10:42 am
I only camp in hotels.
June 26th, 2008 at 10:44 am
I can live without the TV & air conditioning; although I would DEFINITELY need an internet connection.
-Richie
June 26th, 2008 at 10:46 am
james bednar is really an anagram for
Bad Jerse Man
okay, I am bored
June 26th, 2008 at 10:46 am
Supremes strike down DC gun ban.
This may not mean much. Depends on the text of the opinion. Will still have to fight the same battle in NJ regardless.
June 26th, 2008 at 10:52 am
Kettle1 (157),
“STu,
do you realize you have now been put on a watch list for suggesting that we all short the US gov?”
I would bet that my long term short CRE has had me listed for a little over 9 months already.
manhattanexile: SRS, but do your research since it’s an ultrashort ETF. With 2x the leverage, you can get a real wedgie if you don’t hedgie.
Disclaimer: I am not recommending sh*t.
June 26th, 2008 at 10:56 am
163 nom,
i was kidding about the costa rican compound. but agree 100% with your pennsyltucky retreat idea
June 26th, 2008 at 10:59 am
nom,
did you ever get any other interested parties besides me?
June 26th, 2008 at 10:59 am
james bednar
Just
A
Man
Eating
Sausuage
Bending
Drone for the
National
Association of
Realtors
June 26th, 2008 at 11:02 am
National Right to Carry here we come!
(runs, hides)
June 26th, 2008 at 11:04 am
Advice for Grim:
Start investigating personal security guards.
June 26th, 2008 at 11:04 am
“do you realize you have now been put on a watch list for suggesting that we all short the US gov?”
kettle,
One of the best trades on the board for the past 7 years. Oh, and those markets that correspond positively to this short.
June 26th, 2008 at 11:12 am
Kettle1,
I’d be interested in joining your compound. I’m a hell of a gardener and pretty good with electric. Will there be any polygamy or munitions involved?
June 26th, 2008 at 11:17 am
173 Grim
You don’t have to run. We know you’re packin’ heat. I ain’t gonna argue with you.
June 26th, 2008 at 11:18 am
162 john
‘a flower-cutting room,’
barf
June 26th, 2008 at 11:18 am
11,599 how fast can we see a 10 handle?
June 26th, 2008 at 11:19 am
nom
“Thought you were going to Philly? ”
Likely in a year or two, but we don’t have to tell that to the folks in your recruiting dept. when I show up to the scotch tasting, do we?
June 26th, 2008 at 11:21 am
171 ket
“did you ever get any other interested parties besides me?”
I would be, but Mrs. Patient not so keen.
June 26th, 2008 at 11:22 am
Nas down 2.6%!
June 26th, 2008 at 11:23 am
Stu,
No poligamy just Elliot Spitzer type transactions.
June 26th, 2008 at 11:23 am
176 stu
“I’m a hell of a gardener”
This is actually the biggest reason why I look forward to buying. I love the vegetable gardening.
June 26th, 2008 at 11:29 am
you dont have to buy a house to plant a garden
June 26th, 2008 at 11:30 am
[171] Kettle1,
Other than Stu at [176], no one from the board. But I wasn’t expecting much. The target demographic is professionals with families and significant savings, living in NYC or its close-in suburbs in NJ.
Also, folks have to get past the whole “crackpot” notion of having this sort of property interest. I can certainly explain the concept and benefits, and the way it is structured makes it a reasonable investment, but folks still have to come to grips with parking 40-70K in a marginally productive investment for a couple of decades. Not the easiest sell.
Stu,
Munitions, yes. Legal targets only. As for polygamy, you are on your own, just stay away from my wife.
June 26th, 2008 at 11:31 am
“you dont have to buy a house to plant a garden”
Of course not, and I haven’t waited, but a lot of things I would like to do are costly, and I don’t want to put a few thou into the landlord’s future enjoyment of his property.
June 26th, 2008 at 11:33 am
I was out a client yesterday, and they said that their banker of 18 yrs was removed from their account and his supervisor put on. Shortly after they were notified that they better start looking for a new bank before their 3.5 million balloon payment comes due on their facility. Existing bank is shedding risk and apparently they are out. Luckily they have 18 months and the personal resources to secure credit, but I suspect many small businesses are going to be in trouble soon with credit disappearing.
June 26th, 2008 at 11:34 am
Grim,
I just perused the SCOTUS opinion. No need to run and hide. This decision barely nudges the needle here in the People’s Republic since NJ will permit a gun in the home. Scalia purposefully avoided expanding the decision beyond the narrow relief requested (meaning carry laws are unaffected), and did not apply strict scrutiny, leaving open the possiblity state “regulation” designed to keep all but the most determined from exercising the right to own.
June 26th, 2008 at 11:34 am
Stu
munitions… absolutly! :)
Polygamy….??? to each their own my friend, perhaps we will need a dont ask dont tell policy
June 26th, 2008 at 11:36 am
whats wrong with this?
Existing home sales edge up 2 percent in May
http://biz.yahoo.com/ap/080626/home_sales.html?.v=2
June 26th, 2008 at 11:37 am
Just wait until the NJgator reads my polygamy comments. I may be eating out tonight, as in, out in the dog house ;)
June 26th, 2008 at 11:38 am
http://www.jibjab.com/view/236742
I love this clip of Gene Gene the Dancing Machine!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
June 26th, 2008 at 11:41 am
Bi,
All in distressed markets.
June 26th, 2008 at 11:47 am
http://money.cnn.com/quote/quote.html?symb=IMB
One dollaa, one dollaa, get you IndyMac stock here for one dollar.
bank run anyone????
June 26th, 2008 at 11:47 am
“whats wrong with this?”
bi,
You tell me.
The median price of an existing home sold in May dropped to $208,600, a fall of 6.3 percent from a year go. That was the fifth biggest year-over-year price decline on records that go back to 1999.
U.S. existing-home sales down 15.9% in past year
Resales have sunk 15.9% in the past year and are down 31% from the peak in 2005.
June 26th, 2008 at 11:50 am
A little off topic but..anybody notice a few more scooters on the road lately?
June 26th, 2008 at 11:51 am
197,
i tend to take back roads and in the last 6 months i have seen an explosion of motorcycles and scooters
June 26th, 2008 at 11:54 am
I am looking at this one.
http://www.piaggiousa.com/pScooters/FLY50.cfm
June 26th, 2008 at 11:55 am
[197] DINJ
No surprise, and I was going to get one last year when I lived in Philly, but then I moved and did not want to deal.
I have not seen many at all in Brigadoon however.
June 26th, 2008 at 12:03 pm
Lots of Vespas tooling around the shore area.
June 26th, 2008 at 12:03 pm
Nom, Why Scoot when you can glide an an air of superiority.
June 26th, 2008 at 12:12 pm
BC (19)-
“Maybe I’ll just watch some recent Bergabe testimony.”
Watching Yankees and/or Bergabe both go on my “Acceptable Substitutes for Syrup of Ipecac” list.
June 26th, 2008 at 12:14 pm
bairen (20)-
Buying CFC was BAC’s little way of taking a writedown…in a non-writedown form.
June 26th, 2008 at 12:18 pm
when gas is to expensive
http://i32.tinypic.com/208wgnq.jpg
June 26th, 2008 at 12:20 pm
From HousingWire:
Alt-A Performance Gets Much Worse in May
Problems are continuing to grow sharply among Alt-A borrowers, despite a dearth of pending rate resets, underscoring just how much home price depreciation is affecting borrowers in key housing markets nationwide.
A new report released by Clayton Fixed Income Services, Inc. on Wednesday afternoon found that 60+ day delinquency percentages and roll rates increased in every vintage during May among Alt-A loans, while cure rates have declined only for 2003 and 2007 vintages.
The picture being painted for Alt-A is increasingly beginning to look a whole lot like subprime, as a result, even if peaking resets in the loan class aren’t expected until the middle of next year. In particular, loss severity continues to ratchet upward — a trend that portends some likely further reassessment of rating models at each of the major credit rating agencies, as they catch up with the data.
Loss severity — the average amount lost relative to unpaid principal balance — reached 41.4 percent for all Alt-A first liens in REO during the most recent rolling six month period through May, Clayton said; that was up from a 37.6 percent rolling average one month earlier, and compares to a similar 49 percent loss severity average for subprime first liens liquidated in REO through May.
Those numbers make Standard & Poor’s Ratings Services latest assumption of 35 percent loss severity on Alt-A loans, only one month old, already start to look a little too conservative. The rating agency’s updated loss severity assumption was one key reason the agency cut ratings of 1,326 Alt-A residential mortgage-backed securities in late May — and put another 567 AAA-rated tranches on negative ratings watch.
June 26th, 2008 at 12:22 pm
[202]
DINJ: “Nom, Why Scoot when you can glide an an air of superiority.”
How did you know I was a Bostonian??? ;-o
June 26th, 2008 at 12:25 pm
Anheuser-Busch to reject $46.3 billion InBev offer
June 26th, 2008 at 12:29 pm
#207 Egad!!!!
#205 Ass-trading! I love it!!!
June 26th, 2008 at 12:29 pm
Kettle1,
Someone told me that last night. Seemed like insider info to me.
June 26th, 2008 at 12:31 pm
You know what I am bored with the bad news. Back in August 2007 when this started I was shocked, around March 2008 I was even more shocked when Bear collasped now it is like Whatever. A lot of people I know are in the whatever stage, sweet 16s, weddings, vacations etc. as life goes on. As my friend put it in his Tony Town, “there is a line of people waiting to buy at reduced prices” He thinks his town is great and it is irrelvant what you paid as everyone is staying till the day they die. As for the schmucks in his town who lose their job and then their home, well at 200K off another nice family will buy and move in. He thinks the crap towns will tank more as they don’t have a line of people with cash looking to buy into his town. He then told me Look their will always be rich people and if I want to live in a rich train town I need to suck it up and relize I am going to get money off but not blood in the streets money off as I would in a crap neighborhood. Ouch that hurts.
June 26th, 2008 at 12:33 pm
stu,
a tactical move to force InBev to increase the offer?
June 26th, 2008 at 12:34 pm
“He then told me Look their will always be rich people and if I want to live in a rich train town I need to suck it up and relize I am going to get money off but not blood in the streets money off as I would in a crap neighborhood.”
John,
Same crap, different market.
I heard the same from traders regarding rich dot com stocks. The horseman were said to be immune. Too bad they forgot to feed the mule.
June 26th, 2008 at 12:34 pm
Clue (155)-
“I would love nothing more than to see a tornado rip through that eye sore of a development that Toll put up on New Center and Beekman.”
I troll that neighborhood for foreclosures. They’re coming; I can smell it.
Sometimes I just drive thru neighborhoods like that and look for high grass and open windows.
June 26th, 2008 at 12:35 pm
The under-5 population in Manhattan ballooned almost 30 percent from 2000 through 2006, according to U.S. Census Bureau estimates. With a boom in construction of 3-, 4- and 5-bedroom apartments, demand for kindergarten is spilling to public schools.