Will the housing credit become untouchable?

If critics think the credit is so supportive, what are the chances that the credit becomes not only permanant, but as untouchable as the mortgage interest deduction?

From CNN/Money:

Push on to expand $8,000 tax credit

Congress is considering proposals to greatly expand a soon-to-expire $8,000 tax credit for first-time homebuyers — potentially applying it to all but the wealthiest homebuyers.

Supporters say doing so would further boost home sales, stabilize housing prices and generate jobs. Opponents say extending and expanding the credit would be a waste of money and only temporarily stave off further price declines.

The credit now can be claimed by anyone buying a home who has not owned one for three years and who closes the deal by Nov. 30.

Beyond extending that deadline, some lawmakers want to make the credit available to all homebuyers who meet income eligibility requirements. And some want to increase the amount of the credit from $8,000 to $15,000.

Opponents of extending and expanding the credit worry that such moves offer poor bang for the buck and won’t stem housing declines.

“Everything spent on this program will ultimately have to be paid for later through higher, economically harmful taxes,” Ted Gayer, co-director of economic studies at the Brookings Institution, wrote in a Brookings blog.

Assuming there are 5.5 million home sales in 2010, Gayer said, expanding the credit to all homeowners “is poorly targeted because it would give a credit to 5.5 million homebuyers who would have bought a home anyway.”

The current credit was estimated to cost federal coffers $6.64 billion over 10 years. But Gayer notes that the cost is likely to be much higher since more people than expected took advantage of it but only about 15% of people wouldn’t have bought a house otherwise.

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213 Responses to Will the housing credit become untouchable?

  1. grim says:

    From the Record:

    Office vacancies at 13-year high

    Office availabilities in Bergen County rose to the highest level in at least 13 years in the third quarter, as companies continued to shed employees and space for them to work, according to newly released data.

    In Bergen County, the state’s second-largest market for office space, 25.8 percent of office space was available for lease in the third quarter, compared with 21.7 percent available in the third quarter last year, according the commercial real estate brokerage Grubb & Ellis.

    More than a decade ago, Bergen County’s office availability rate stood at 16.1 percent in the third quarter of 1996, when Grubb & Ellis began tracking the office market, said Stephen Jenco, a researcher at the firm’s offices in Fairfield.

    “Companies are looking to control costs,” Jenco said. “They’ve reduced their payrolls. They are looking to become more efficient in their operations.”

    “If you’re cutting your employees,” he added, “you’re looking at the space that those employees worked in.”

  2. grim says:

    From the Star Ledger:

    Lost casino jobs are window on N.J. employment woes

    There are few places as democratic as the unemployment office these days.

    From December 2007, the acknowledged start of the recession, to September of this year, New Jersey has lost about 155,700 jobs.

    The breakdowns go something like this, give or take a few thousand:

    • 40,900 professional.

    • 35,800 trades and transportation.

    • 30,300 manufacturing.

    • 26,000 construction.

    • 17,900 finance.

  3. grim says:

    From Bloomberg:

    Foreclosures Will Peak at End of 2010, Mortgage Bankers Say

    Foreclosure rates will continue to climb through late next year, peaking only after the U.S. unemployment rate reaches 10.2 percent in the second quarter, the Mortgage Bankers said.

    “This recession is like a hurricane: You’ve survived the storm and you have a big mess afterwards,” Jay Brinkmann, the chief economist of the Mortgage Bankers Association, said today at the group’s annual conference in San Diego. The effects of the recession, which he said probably ended in July, will linger for “some time” in the form of higher unemployment, fewer mortgage originations and lower business development, he said.

    Brinkmann forecasts $1.56 trillion in mortgage originations for 2010, down about 21 percent from a projected $1.96 trillion for this year.

  4. JerseyLand says:

    Are the people getting the first time home credits buying with any required down payment or is there some type of mechanism in place to take that tax credit (and I assume a tax refund at the end of the year) and automatically use it as some type of downpayment?

    If no required (or to little) of a downpayment, are we not fueling the problem of the housing market further?

  5. Essex says:

    I am now becoming mildly agoraphobic.

  6. grim says:

    From CNBC:

    Housing Crisis Still Squeezing Wealthy Americans

    Despite some signs that the worst of the U.S. residential housing crisis may be over, many wealthy homeowners are still being squeezed by the combination of weak home prices and the stock market crash.

    “I think for wealthy homeowners it will get worse before it gets better,” said Dennis Hedlund, founder of iEmergent, a forecaster for mortgage and real estate companies. “I don’t think home prices have bottomed yet. Many people are stuck at the high end, as there aren’t many buyers out there,” Hedlund said of owners of luxury properties.

    The national luxury market is weak on both the buyer and seller sides, coast to coast. Wealthy homeowners have seen cash reserves erode from the stock market collapse, which also hit retirement savings.

    The big drops in home prices have squeezed home equity loans. And many high-earners have also lost jobs.

    “High-end owners have been hit from all sides,” said Cora Berkery, a realtor at Surterre Properties in Orange County, California, site of Disneyland and hundreds of million-dollar homes.

    Many wealthy homeowners have held asking prices high in the hope of outlasting the 2-year old property slump. But more are expected to slash prices in the coming year to avoid further losses or obtain cash, adding more properties to the market.

  7. crossroads says:

    #4 j-land

    i’m thinking the same thing. %20 down on a median priced home in NJ is putting down 70k. not many people have the cash to do that. and then not many can afford 300k mortgage w/ 7500 in taxes. so there should be people struggling for years to come.

  8. grim says:

    From Bloomberg:

    Geithner Aides Reaped Millions Working for Banks, Hedge Funds

    Some of Treasury Secretary Timothy Geithner’s closest aides, none of whom faced Senate confirmation, earned millions of dollars a year working for Goldman Sachs Group Inc., Citigroup Inc. and other Wall Street firms, according to financial disclosure forms.

    The advisers include Gene Sperling, who last year took in $887,727 from Goldman Sachs and $158,000 for speeches mostly to financial companies, including the firm run by accused Ponzi scheme mastermind R. Allen Stanford. Another top aide, Lee Sachs, reported more than $3 million in salary and partnership income from Mariner Investment Group, a New York hedge fund.

    As part of Geithner’s kitchen cabinet, Sperling and Sachs wield influence behind the scenes at the Treasury Department, where they help oversee the $700 billion banking rescue and craft executive pay rules and the revamp of financial regulations. Yet they haven’t faced the public scrutiny given to Senate-confirmed appointees, nor are they compelled to testify in Congress to defend or explain the Treasury’s policies.

  9. grim says:

    60% of 2006 and 2007 buyers are underwater?

    Oh bother…

    From HousingWire:

    Fitch Sees 60% of Current RMBS Borrowers Underwater

    The majority — 60% — of remaining performing borrowers within ‘06- and ‘07-vintage residential mortgage-backed securities (RMBS) bear negative home equity, meaning they are underwater on their mortgages and owe more than their houses are worth.

    This overwhelming presence of negative equity is hampering sustained improvement in RMBS performance, according to Fitch Ratings.

    “[N]egative equity reduces a borrower’s inventive to pay their mortgage and limits their options when faced with financial difficulties,” said senior director Grant Bailey in a statement.

  10. confused in NJ says:

    Interesting that BOA is imposing an Annual Fee on Credit Card holders that pay their balances off monthly.

  11. #10 – Yeah, I noticed that too. I may end up canceling the card entirely.

  12. gary says:

    Many people are stuck at the high end, as there aren’t many buyers out there,” Hedlund said of owners of luxury properties.

    This is nonsense. I’ve been told numerous times that the upper end towns in Bergen County are insulated and are bleeding wealth and if one can’t afford to buy here then they need to consider something like Salem County or move out of NJ.

  13. gary says:

    crossroads [7],

    A $350,000 home with $7,500 in taxes gets you a 2 bedroom POS cape in Belleville. Just saying.

  14. House Hunter says:

    Jersey land…bingo! Clot and Grim could speak with more first hand knowledge…not a lot of buyers have 10-20% down. basically, the FHA requirement of 3.5% down is the same thing ..no money down, when you look at the prices of houses. They will try to hold on to this as long as they can. The gov’t basically has their hands in about 80% of the mortages today. add school loans and they own you.

  15. ruggles says:

    4 – someone already put this here a few days ago but from this week’s NYTimes:

    Chaz Fullenkamp, an automotive technician in Columbus, Ohio, got an F.H.A. loan even though he was living on the financial edge. “If I got unemployed, I’d be wiped out in a month or two,” he says. Thanks to the F.H.A., however, he is better off than he used to be.

    Mr. Fullenkamp used F.H.A. insurance to buy a house this spring for $179,000. The eager seller paid the closing costs and also gave Mr. Fullenkamp $2,500 in cash. He immediately applied for the $8,000 tax rebate. Even taking his down payment into account, he came out ahead.

    “I knew in my heart I could not really afford the house, but they gave it to me anyway,” said Mr. Fullenkamp, 22. “I thought, ‘Wow, I’m surprised I pulled that off.’ ”

  16. crossroads says:

    13

    yes Gary but its real estate and it only goes up they’re not making anymore land you know

  17. BC Bob says:

    “A $350,000 home with $7,500 in taxes gets you a 2 bedroom POS cape in Belleville. Just saying.”

    Gary,

    In 2005, 500K got you a tent on Washington Ave. Just saying.

  18. Dissident HEHEHE says:

    Market going to pop today. The Chinese manufacturing base is sitting silent so their gubmint is resorting to manufacturing lies:)

  19. goonsquad says:

    Sign o’ the times:

    Man out on 42nd and Lexington wearing an “Accountant MBA Needs a Job” sign.

  20. #18 – There is some truly awful stuff there.

  21. BC Bob says:

    “Man out on 42nd and Lexington wearing an “Accountant MBA Needs a Job” sign.”

    Did they boot John’s ass out of Land Shark Stadium?

  22. 3b says:

    Bottom line is anyone purchasing today, with 10k a year and more in property taxes in ordinary towns, with no end in increases in sight runs the risk that when they sell it in 15 or 20 years, after accounting for property taxes and interest paid, will not make a dime in profit on the house. Pardon the run on sentence.

  23. NJGator says:

    This morning our train was ‘annulled’ at Newark Broad Street (actual term used by the conductor). It’s like NJ Transit wanted to pretend we never existed. Highlight of my morning was watching Stu jump the metal rail partition in order to get on the Hoboken train – there was a huge line of people waiting for a NY train that wouldn’t move to let him board. Fun times.

    I love my convenient train town commute. Train to Light Rail to Train to Subway to get to my office today. Bloomfield to Ny in 1 hr 20 minutes today. Easily worth an extra 200k if you ask me!

  24. Shore Guy says:

    Gator, if you move south of Toms River, the express bus will get you there in just two hours. Can there be a better use of 960 hours a year (assumes 4 weeks off for holidays and vacations)?

    Lets review: 24 hours in a day

    8 hours working (if one is lucky and gets a paid lunch and no OT or requirement to work longer)

    4 hours traveling to/from work

    1 hour getting ready for work, eating breakfast, etc.

    1 hour getting ready for bed, laundry and other chores in the evening.

    1 hour preparing, eating, cleaning up dinner

    8 hours sleeping, and other nocternal activities.

    This leaves our commuter with a full hour to devote to all of lifes pleasures and for helping Johnny and Sisie with homework, going to practice, whatever.

    It’s a wonderful life.

  25. lisoosh says:

    I’ll repost as it was buried last night:

    California signing onto laws to control mortgages:

    http://business.theatlantic.com/2009/10/californias_sensible_mortgage_restraints.php

    AB 260 … tightens restrictions on mortgage brokers so they cannot steer borrowers to riskier, higher-interest loans when they qualify for less-expensive ones.

    … bans so-called negative-amortization loans, which offer the option of monthly payments so low that the loan amounts can actually grow over time.

    … limits prepayment penalties to no more than 2% of the loan balance and allows state regulators to enforce federal lending laws.

    SB 239 … makes it a felony to commit fraud on a mortgage loan application.

    AB 329 … requires lenders to give more and clearer information to those interested in reverse mortgages, which let seniors borrow against their homes’ equity.

    AB 1160 … requires that mortgage loan documents be written in the same language the verbal negotiations were conducted in.

  26. Shore Guy says:

    “This morning our train was ‘annulled’ ”

    This sounds like something the Governator would have done in one of his movies.

  27. Shore Guy says:

    lisoosh,

    Here they go, taking choice away from the American consumer. Or, so I assume the MBA, will say.

  28. kettle1 says:

    wicked orange 18

    MY EYES!!!!!

    quick, need eye bleach

  29. lisoosh says:

    #15 – My single mom neighbour wants to buy using those FHA loans. Even worse, her Realtor is pushing her into some $100 down program for distressed areas and she is desperate to bite. I’m working hard to talk her out of it – she can’t save for a downpayment so I keep reminding her that if she owns and the water heater goes she’ll be scr@wed.

    Even sadder, she has a good job, makes around $50k and doesn’t buy new cr@p. Drives an old car etc. I should go over her budget to see where she is bleeding money but I think it is the child care that is wiping her out.

  30. kettle1 says:

    lisoosh

    child care is easily 1K/month or more. 50K/yr works out to about 3K/month in take home pay. Child care could easily be eating up about 1/3 of her income

  31. Shore Guy says:

    3b,

    Buth they will have “pride of ownership,” whatever the RE agents mean by that phrase.

    “mildly agoraphobic.” ?? Is that fear of fuzzy sweaters made of rabbit fur?

  32. Shore Guy says:

    “I knew in my heart I could not really afford the house, but they gave it to me anyway,” said Mr. Fullenkamp, 22. “I thought, ‘Wow, I’m surprised I pulled that off.’ ”

    I understand that this was going on back in the bad old days pre last September but, for this to be going on NOW is insane. Why on earth are we bending over to help people like this buy houses?

  33. Shore Guy says:

    That WalMart site is like road kill.

  34. gary says:

    Shore [33],

    Hmmm… Sela Ward or Walmart girl. I’ll have to think about it. :)

  35. #29 – I can’t stop though! It’s just like Vice magazine’s Do’s and Dont’s, only with just the Dont’s.
    It also completely panders to the NPR listening, Volvo driving snob inside me.

  36. kettle1 says:

    shore 34,

    come on now man, you know why. If we stop feeding fresh meat into the meat grinder of “Home Ownership” then the whole market comes down. Given that the economic growth of the last 5- 10 years was based on housing, things get ugly quickly.

    When you are only in office for 4 years, kicking the can is the name of the game!

  37. 3b says:

    #32 I really do not think people appreciate that. Imagine owning a house for 15 or 20 years selling it, and not making a dime? Assume property taxes of 10k a year for 20 years, with no increases, that would be 200K, just in property taxes, plus all the interest paid, even with low rates, and allowing for the shrinking tax benefit of owning.

  38. Shore Guy says:

    GAry,

    THAT is a tough choice.

  39. Schumpeter says:

    shore (34)-

    I’ve been saying it for two years: there is absolutely NO difference between subprime and FHA. If anything, the detonation of recent-vintage FHA loans will dwarf the subprime debacle.

    The only exception, of course, is that you and I are the insurers of those FHA mortgages.

    One day closer to oblivion.

  40. Schumpeter says:

    gary (36)-

    Take Sela Ward. You won’t have to roll her in flour and look for the wet spot.

  41. stan says:

    I never imagined the extent the govt would go to keep this charade going.

    I knew there would be attempts but the programs and credits they have come up with is something I severely underestimated.

    I have full faith that in the end it won’t be successful, but it really is amazing when you take a step back and look at it.

    Today is a morning I question why do the right thing, ie save, dp, good credit etc etc, especially after reading that sh*thead who was amazed he “pulled this one off”, and got a mortgage he never should have qualified for.

    We’ll be on the hook for you in 18 months……

  42. 3b says:

    #43 Don’t fight it, you cannot so why bother. Go FHA, with as little down (3.50%),and keep your money. Your mtg will than be govt owned, if you run into trouble, get your loan modified, govt will never throw you out. It is a win-win sitaution for you. Of course we are destroying the country,and future generations. But as the song say we didn’t start the fire.

  43. Shore Guy says:

    If they extend the credit to all buyers, I think that eaxh of my kids will buy something with nearly nothing down in a couple of nice vacation spots. If they cover the mortgage, so be it, if not, hey, there are two years of free vacations. I love Democrats.

  44. crossroads says:

    stan

    don’t worry our higher thinking society will pull us through this mess. what we need to do is just sit and think of a solution.

    people in high-thinking jobs will have it figured out in no time flat

  45. stan says:

    3b-

    Starting to come to this conclusion. it is unbelievable.

    unbelievable

  46. BC Bob says:

    “I never imagined the extent the govt would go to keep this charade going.”

    Stan,

    Fun times with monopoly $. Nobody seems to care, except the dollar and the prudent. Feel sorry for the next couple of generations. They didn’t sign up for this.

  47. lurkerd says:

    I apologize for the long post. Since people often cite a link between income levels and home prices, I think it is relevant to post this article about compensation trends for an industry which is important in our area.

    OCTOBER 14, 2009 Wall Street On Track To Award Record Pay

    By AARON LUCCHETTI and STEPHEN GROCER
    Major U.S. banks and securities firms are on pace to pay their employees about $140 billion this year — a record high that shows compensation is rebounding despite regulatory scrutiny of Wall Street’s pay culture.

    Workers at 23 top investment banks, hedge funds, asset managers and stock and commodities exchanges can expect to earn even more than they did the peak year of 2007, according to an analysis of securities filings for the first half of 2009 and revenue estimates through year-end by The Wall Street Journal.

    Total compensation and benefits at the publicly traded firms analyzed by the Journal are on track to increase 20% from last year’s $117 billion — and to top 2007’s $130 billion payout. This year, employees at the companies will earn an estimated $143,400 on average, up almost $2,000 from 2007 levels.

    Let the Good Times Roll, Again
    Sortable Table: Projected Compensation at 23 Financial Firms See the methodology More interactive graphics and photos FINS.com: Compensation Juice for Investment Banks to Vary in 2009 WSJ.com/ExecutivePay: News, pay data, more The growth in compensation reflects Wall Street firms’ rapid return to precrisis revenue levels. Even as the economy is sluggish and unemployment approaches 10%, these firms have been boosted by a stronger stock market, thawing credit market, a resurgence in deal making and the continuing effects of various government aid programs.

    The rebound also reflects growing confidence by some Wall Street firms that they can again pay top dollar for top talent, especially once they have repaid the taxpayer-funded capital infusions they received at the height of the crisis. So far, regulators and lawmakers have focused on making sure pay practices discourage excessive risk-taking, leaving to companies the question of how much is too much.

    The Journal’s analysis includes banking giants J.P. Morgan Chase & Co., Bank of America Corp. and Citigroup Inc.; securities firms such as Goldman Sachs Group Inc. and Morgan Stanley; asset managers BlackRock Inc. and Franklin Resources Inc.; online brokerage firms Charles Schwab Corp. and Ameritrade Holding Corp.; and exchange operators CME Group Inc. and NYSE Euronext Inc.

    These firms’ total revenues are projected to hit $437 billion, surpassing 2007’s $345 billion, according to the analysis. The rise in total revenue and compensation is in part a function of Bank of America’s acquisition of Merrill Lynch & Co. and J.P. Morgan’s acquisitions of Bear Stearns Cos. and the banking operations of Washington Mutual Inc.

    To reach its 2009 projections, the Journal examined publicly disclosed quarterly compensation figures for each firm so far this year. These include salary, health benefits, retirement plans and stock awards, and also typically include money these firms put away throughout the year to fund later bonus payouts.

    The Journal calculated each company’s compensation as a percentage of revenue. It then projected how much the company would pay at that rate over the full year, using analysts’ quarterly and full-year revenue estimates provided by Thomson Reuters. The methodology was reviewed by compensation experts.

    Investment banks such as Goldman and Morgan Stanley typically pay employees about 50% of revenue. The rate is lower at commercial banks, whose tellers and other retail-banking employees earn less than traders.

    Some companies contacted about the analysis didn’t dispute the methodology, though others said it was too early to speculate. Some say they set aside more money for compensation at the beginning of the year, in order to avoid shortfalls, and then ratchet back later.

    Goldman disputed the Journal’s projection that the bank was on track to pay a record-high $21.85 billion. Spokesman Lucas van Praag said Goldman paid an average of 46.7% of net revenue from 2000 to 2008, lower than the 49% rate used by the Journal.

    Based on Goldman’s historical average, it would be on pace to report full-year compensation and benefits of about $20 billion. In 2007, Goldman paid out $20.19 billion, its securities filings show.

    View Full Image

    Bloomberg News

    The rebound in pay reflects growing confidence by Wall Street firms that they can again pay top dollar for top talent, especially once they have repaid the taxpayer-funded capital infusions they received at the height of the financial crisis. Above, the Wall Street bull sculpture sits on display between Broadway and Exchange Place.
    Another wild card is whether financial firms will bend to public and political pressure to rein in pay. “Compensation played a role in the financial crisis, and yet nothing has changed,” says J. Robert Brown, a professor at University of Denver’s law school and an expert on corporate governance.

    The Obama administration’s pay czar, Kenneth Feinberg, is expected to issue as soon as this week his findings on compensation packages at seven firms receiving federal aid, including Bank of America and Citigroup.

    Among firms facing scrutiny from Mr. Feinberg, Citigroup is on pace to pay about $22 billion, down 32% from last year. Bank of America is on track to pay about $30 billion, up 64%, the Journal analysis shows. But much of that increase reflects Bank of America’s purchases of Merrill Lynch and Countrywide Financial Corp. Both banks are on pace to pay less as a percentage of net revenue than they did in 2008.

    Michael Karp, cofounder of recruiting firm Options Group, says he doesn’t think “2007 is back,” adding Wall Street executives have leeway to pay less and don’t want placards in front of their offices decrying big pay packages.

    Indeed, some companies in the analysis are scaling back on compensation, reflecting recent moves to cut jobs, shed businesses or hunker down until they are more confident in the market rebound’s staying power. Mutual-fund giant T. Rowe Price Group Inc. has shrunk its work force by about 10% since the end of 2008 and reduced its annual bonus pool in the quarter ended June 30. Its overall compensation bill is on pace to decline by about 16%.

    Many financial firms, however, say they need competitive pay packages, pointing to threats from non-U.S. companies, private-equity firms and hedge funds. Mr. van Praag, the Goldman spokesman, said the firm understands public sentiment over bankers’ pay, but added: “The easiest way to destroy the firm would be if we didn’t pay our people….Destroying a profitable enterprise would not be in anybody’s interest.”

    Goldman also says employees have long had a stake in its long-term results because many are compensated in part with shares they can’t touch for several years. Average compensation per employee is on pace to reach about $743,000 this year, double last year’s $364,000 and up 12% from about $622,000 in 2007, according to the Journal analysis.

    At some firms where revenue is rebounding at a relatively slow rate, more incoming cash is going toward pay. In the first half of 2009, Morgan Stanley paid out or set aside about 70 cents of every $1 in net revenue for compensation and benefits, up from its historic rate of about 50%.

    At the recent rate, Morgan Stanley is on pace to pay about $16 billion for 2009, up 33% from last year, despite a projected 6% decline in revenue. Many analysts expect Morgan’s ratio to come down in the year’s second half.

    The New York firm says its revenue has been hurt by a rise in the prices of its bonds, which makes it more expensive for the firm to buy them back. The company added that compensation levels will likely be pushed higher by a brokerage joint venture it introduced this year with Citigroup.

  48. 3b says:

    #47 Took me a while too, but you cannot fight it, just make it work for you. Take advantage of the situation. Forget about doing the right thing, that is for fools. All the time tested rules and mores have been thrown out the window.

  49. Shore Guy says:

    What we seem to need is a buyers’ strike — new week when nobody goes to an open house, or calls a RE agent, or returns a cal from one. Just dead silence from buyers.

  50. Shore Guy says:

    Do you think she puts out on the first date? (Not completely safe for work).

    http://media.peopleofwalmart.com/wp-content/uploads/2009/09/172.jpg

  51. 3b says:

    #49 The industry is still shrinking amid the joy of renewed deal making and big bonus money again. And many of these higly paid people already have houses. I see no real impact now of wall st on house prices, in our area.

  52. BC Bob says:

    [49],

    1 step forward, 2 steps back. WS will save the housing market?

    Yogi; ” It’s deja vu all over again”

    When hedge funds receive free capital, it’s not difficult to churn big profits.
    If you take away the debt guarantees, trading with the fed, monopoly $ and FASB gimmicks the street would be stuck in the muck. Also, a positive yield curve will always turn idiot bankers into geniuses.

    One major problem; How does WS bonuses affect the 26M unemployed/underemployed.

  53. Comrade Nom Deplume says:

    [33] shore

    AAAUUUGHH. My eyes!!!!!!!!!!

    Curse you Shore Guy

  54. Comrade Nom Deplume says:

    [53] shore

    I think I remember her. She had a sister too, I recall.

  55. kettle1 says:

    Shore 33

    I’ll see your bid and raise you this

    http://media.peopleofwalmart.com/wp-content/uploads/2009/08/53.jpg

  56. Shore Guy says:

    Hey Gary. Sela Ward is not half the woman as this one is:

    http://media.peopleofwalmart.com/wp-content/uploads/2009/09/119.jpg

  57. Brian says:

    This has been my biggest criticism of the tax credit. It is not targeted and ulitmately ends up costing $60k+ for each incremental house sold.

    The powerful NAHB and NAR lobbies will argue aggressively to extend this credit. Congress should draw a line in the sand here.

  58. Brian says:

    This has been my biggest criticism of the tax credit. It is not targeted and ulitmately ends up costing $60k+ for each incremental house sold.

    The powerful NAHB and NAR lobbies will argue aggressively to extend this credit. Congress should draw a line in the sand here.

  59. pricedOut says:

    #52 Shore Guy says:
    October 14, 2009 at 10:11 am

    What we seem to need is a buyers’ strike — new week when nobody goes to an open house, or calls a RE agent, or returns a cal from one. Just dead silence from buyers.

    Not gonna happen… Every time I feel encouraged, something comes along to knock me right back down. Anecdotal, but my significant other called me to say that a friend who listed their house in Union (Union Co) for $400K plus a couple of weeks ago just sold it. When they listed it, I thought to myself that it would never move at that price. I don’t know what # they accepted, but I do know that they wouldn’t have accepted under 4. I feel like Gary…

  60. kettle1 says:

    interesting…

    Colorado minimum wage to drop to $7.24 as living costs fall

    Colorado officials have confirmed that the state next year will become the first to lower its minimum wage because of a falling cost of living. The state Department of Labor and Employment ordered the wage down from $7.28 to $7.24. That’s lower than the federal minimum wage of $7.25, so most minimum wage workers will lose 3 cents an hour. Colorado is one of 10 states where the minimum wage is tied to inflation. The indexing is thought to protect low-wage workers from having flat wages as the cost of living goes up. But because Colorado’s provision allows wage declines, the minimum wage will drop because of a falling consumer price index. It will be the first decrease in any state since the federal minimum wage law was passed in 1938.

    http://www.dailycamera.com/state-west-news/ci_13550758

  61. kettle1 says:

    phantom corporate profits

    Net private investment, which includes spending on everything from machine tools to new houses, minus depreciation, fell to 0.1% of gross domestic product in the second quarter of 2009, according to the latest government data. That’s the lowest level since at least 1947.

    http://1.bp.blogspot.com/_9ZzZquaXrR8/StVTGzwufjI/AAAAAAAAE-M/o5tUIkt8UBs/s640/CostCuts-Lift.gif

  62. Alap says:

    If they expand the credit to $15k, i am defintely buying a house this winter. and if i dont feel like paying, i wont for 2 years. and then give up the house.

  63. kettle1 says:

    Brian 61

    its not the NAR’s fault. The government itself wants the housing bubble reinflated. Look at Barney Franks recent comments about the housing bailout being a policy.

    The NAR is a cancerous lesion of an organization, but they are simply riding the wave that congress is making for them.

  64. kettle1 says:

    Alap 66

    i agree. we get a 15K tax credit and iam seriously going to consider buying . 0 down baby!!!!

  65. make money says:

    Did they boot John’s ass out of Land Shark Stadium?

    Boost,

    I thought John is top (stories) producer.

  66. 3b says:

    #66 Thats the spirit.

  67. Veto That says:

    ok, i just had a co-worker tell me that his home price is down 20% from the time he bought his house in 2007 but then he immediately went on to advise me to stop renting because im throwing all my money away and not building any equity.
    Hmm…

  68. kettle1 says:

    the boomers are going to be pissed

    Steep Losses Pose Crisis for Pensions

    Within 15 years, public systems on average will have less half the money they need to pay pension benefits, according to an analysis by Pricewaterhouse Coopers. Other analysts say funding levels could hit that low within a decade. After losing about $1 trillion in the markets, state and local governments are facing a devil’s choice: Either slash retirement benefits or pursue high-return investments that come with high risk. The urgent need for outsize returns by these vast public pension funds, which must hit high investment targets year after year to keep pace with rising retirement costs, is in turn fueling a renewed appetite for risk on Wall Street.

    http://www.washingtonpost.com/wp-dyn/content/article/2009/10/10/AR2009101002360_pf.html

  69. kettle1 says:

    more on pensions:

    Some pension experts say the funding gap has become so great that no investment strategy can close it and that taxpayers will have to cover the massive bill. The problem isn’t limited to public pension funds; many corporate pension funds have lost so much ground that they are also pursuing riskier investments. And they, too, could end up a taxpayer burden if they cannot meet their obligations and are taken over by the federal Pension Benefit Guarantee Corp.

    —————

    where exactly is all of the tax revenue to cover the national and local spending deficits, while also covering pensions and the interest that is likely to spike once interest rates are forced back up???

  70. safeashouses says:

    I think the gov should just man up and make it up to a 150k tax credit that can be used as a down payment/renovations/redcorating. Once the 20% threshold has been breached, the buyer can put the rest down on the house, or use the balance for renovations and buying furniture.

    The gov could stop the declining housing market and create another false economic boom in one shot. We could kick the can down the road another few years that way.

  71. 3b says:

    #68 kettle I hope it is 15k, 20 or 25K would be even better with no income limits!! It is free money!!

    Who cares about prices, because when you sell in 15 or 20 years, you probably will not make anything. But in the meantime you get a place to live, you get the tax write off (although its attractiveness is declining), you do not have to up and move if the landlord sells your rental, the govt will not throw you out, and with rising property taxes just get a loan modification. Plus you get the warm fuzzy feeling of being a “homeowner”. Amerika is a great. great country.

  72. kettle1 says:

    …..From there, the deficit will grow even wider, according to Kim Nicholl, the national director of PricewaterhouseCoopers public sector retirement practice. Even if public pension funds were to hit their 8 percent investment targets every year, Nicholl calculated they would have less than half of what they need by 2025. This is because a greater share of the population will be retired and those who are will live longer, thus collecting benefits longer, she said.

  73. 3b says:

    #71 FHA all the way, FHA all the way!!!

  74. Alap says:

    3b:

    why should i be left out? the gov’t is encouraging and rewarding stupidity and greed, and those who are fiscally responsible suffer. eff that. no more of that for me if they continue down this road. ill get in line for my handout with the rest of the idiots.

  75. kettle1 says:

    What would this do to high frequency trading???

    Democrats Weigh Tax On Financial Transactions

    …the idea of a national transaction tax that would raise $100 billion to $150 billion a year. The tax, at a rate of 0.1% to 0.25% of the value of the trade, would be levied on all financial transactions such as stock trades, but not on consumer transactions such as with credit cards….

    http://online.wsj.com/article/SB125512957855977163.html

  76. crossroads says:

    66

    i think the tax credit should be %5 of median house price in any given state.

  77. RemainCalmAllisWell says:

    This is a long shot but does anyone have any experience with Fire Sub Code for single family dwellings undergoing renovations? I know it varies from town to town but it is regarding a NJ state ordinance. Specifically in N.J.A.C. 5:18-4.19(A). regarding smoke detectors.

    Do these detectors need to be hard wired or can they be battery operated?

    Does anyone know where I can find info about this online?

    Thanks.

  78. lostinny says:

    All this talk makes me wonder if I should sign the lease for another year or lowball the hell out of everything I see until someone bites.

  79. BC Bob says:

    “Some pension experts say the funding gap has become so great that no investment strategy can close it and that taxpayers will have to cover the massive bill.”

    Kettle [73],

    In NJ, if benchmark returns [I think 8%], are not attained, taxpayers pick up the pieces.

    It’s gonna be a long walk home.

  80. Shore Guy says:

    Can the governemnt just pay everyone $250,000 per year That way we can all be “rich” and then we can tax ourselves into prosperity.

  81. confused in NJ says:

    83.BC Bob says:
    October 14, 2009 at 11:09 am
    “Some pension experts say the funding gap has become so great that no investment strategy can close it and that taxpayers will have to cover the massive bill.”

    Simple solution is a 75% surtax on all Public Pensions to realign them with High End Private Pensions.

  82. safeashouses says:

    #85 Shore Guy,

    85.

    Can the governemnt just pay everyone $250,000 per year That way we can all be “rich” and then we can tax ourselves into prosperity.

    Now you’re talking. But how could most of us afford such a paycut?

  83. Shore Guy says:

    Safe,

    It would be on top of any other income.

  84. Shore Guy says:

    And, the good news is that the ensuing inflation would wipe out our debt too.

  85. kettle1 says:

    Reamin Calm 81

    REQUIREMENTS ON LOCATION OF SMOKE DETECTOR
    AND CARBON MONOXIDE DETECTOR INSTILLATION IN ONE AND TWO FAMILY
    DWELLINGS
    N.J.A.C.5:18-4.19

    I. SMOKE DETECTORS SHALL BE LOCATED IN ACCORDANCE WITH NFPA AND
    MAINTAINED IN WORKING ORDER.
    2. SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS SHALL BE
    INSTALLED AS FOLLOWS:
    ON EACH LEVEL OF THE PREMISES (INCLUDING BASEMENT).
    OUTSIDE OF EACH SEPARATE SLEEPING AREA.
    3. SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS MAY BE BATTERY
    POWERED AND SHALL BE LISTED IN ACCORDANCE WITH ANSI/UL 217. A/C
    POWERED SMOKE DETECTORS AND CARBON MONOXIDE DETECTORES SHALL
    BE ACCEPTED AS MEETING THE REQIREMENTS OF THIS SECTION.
    4. SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS INSTALLED IN
    BASEMENT SHALL BE LOCATED IN CLOSE PROXIMITY TO THE STAIRWAY
    LEADING TO FLOOR ABOVE.
    5. SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS INSTALLED IN
    ROOMS WITH SLOPED CEILINGS SHALL BE LOCATED AT HIGH SIDE OF ROOM.
    6. SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS INSTALLED IN
    HALLWAYS SHALL BE LOCATED SO SOMKE RISING IN THE STAIRWELL
    CANNOT BE PREVENTED FROM REACHING THE DETECTOR BY AN
    INTERVENING DOOR OR OBSTRUCTION.
    SMOKE DETECTORS AND CARBON MONOXIDE DETECTORS ARE NOT REQUIRED IN
    CRAWL SPACES OR IN UNFINISHED ATTIC SPACES.

    WHERE TO LOCATE DETECTORS:
    Detectors are 10 be located on every level of a residence, (basement, first floor, second Door) excluding crawl spaces and unfinished
    attics and in every separate sleeping area, between sleeping areas and living areas such as the kitchen, garage, basement or utility
    room’ In homes with only one sleeping area on one floor, a detector is to be placed in the hallway outside the bedrooms as shown in
    Figure I In single floor homes with two separate sleeping areas, two detectors are required, outside each sleeping area as shown in
    Figure 2 In multi-level homes, detectors are to be located outside sleeping areas and at every finished level ofthe homes as shown in
    Figure 3. Basement level detectors are to be located in close proximity to the bottom of basement stairwells as shown in Figure 4.

    WHEREE NOT TO LOCATE DETECTORES:
    To avoid false alarms and/or improper operation, avoid installation of smoke detectors in the following areas
    Kitchens-smoke from cooking may cause a nuisance alarm.
    Bathrooms-excessive steam from a shower may cause a nuisance alarm.
    Heat forced air ducts-used for heating or air-movement may prevent smoke from reaching detector
    The 4-inch “Dead Airspace where the ceiling meets the wall, as shown in Figure 5,
    The peak of an “A” frame type of ceiling-“Dead Air”at the lop may prevent smoke from reaching detector

    FURTHER INFORMATION ON DETECTOR PLACEMENT:
    For further information about smoke detector placement consult the National Protection Association’s Standard No 74-1984, titled
    -Household Fire Warning Equipment”. For Carbon Monoxide alarms, their publication is Recommended Practice #720 These
    publications may be obtained by writing to the Publication Sales Department National Fire Protection Association, Batlerymarch Park,
    Quincy, MA 02269.
    Carbon Monoxide alarms are to be located in every separate sleeping area per NFPA 720 and manufacturer’s recommendations

    I am not an expert consider this a laymans summary. use this info at your own risk

  86. Jim says:

    I’m going to check out one more house tonight. It is a one story house with a fairly big yard. I’m only going to look at the outside and if it is OK I’ll make an appointment to see the inside. I’m leaning towards the place we saw last week with the sauna in the basement.

  87. JS says:

    Just got this email from my congressman:

    Dear Friend,

    Last week, I introduced a bill in Congress to help spur home sales in New Jersey and put forth a stronger recovery in our housing market.

    Specifically the “Homebuyer Tax Credit Fairness Act” would extend and expand the popular homebuyer tax credit from $8,000 to $15,000 and open it to all homebuyers purchasing a primary residence — regardless of income. The cost of bill would be offset by recapturing unspent funds from the economic stimulus package.

    This important legislation will stabilize the housing market, create jobs and help countless families achieve home ownership.

    According to the National Association of Home Builders, extending and expanding the tax credit could boost home sales by at least 400,000 nationally next year while mitigating the foreclosure crisis by reducing inventory at all levels of the housing market. It’s estimated that my legislation would create nearly 350,000 jobs over the coming year.

    The 2008 home buyer tax credit spurred home sales and played an important role in the recovery of our nation’s housing markets. Expanding and extending the homebuyer tax credit will not only help make buying a home more affordable, but it will help create jobs and that’s exactly what our economy needs right now.

    Best personal wishes,

    Leonard Lance
    Member of Congress

  88. 3b says:

    #82 lowball till someone bites, try to go month to month in the meantime.

  89. 3b says:

    #78 Exactly

  90. 3b says:

    #92 Thanks Lenny!!!

  91. RemainCalmAllisWell says:

    Kettle. Thanks.

  92. lostinny says:

    93 3b

    Problem is if I go month to month, they want an extra $100 a month until I move. If it takes a while to move, I might as well just sign on another year.

  93. kettle1 says:

    Public service announcement:

    Next time you debate government policies and fiscal responsibility based on common sense remember,the People Of Walmart vastly outnumber the bloggers of NJREReport.

    thank you for your attention

    the People of Walmart
    http://media.peopleofwalmart.com/wp-content/uploads/2009/10/288.jpg

  94. lostinny says:

    Kettle

    When I go blind I am blaming you personally.

  95. 3b says:

    #97 Sign for a year, than when you are ready to move don’t pay the last month rent.

  96. #99 – Oh, it gets much much better. I’ll let you discover for yourself.

    I haven’t seen that many non-Billyburg ‘ironic’ mullets in quite some time. Have I been giving the fly-overs too much credit? Is it really this much of a mess?
    Should I not be using peopleofwalmart as my sample set?

  97. Shore Guy says:

    Kettle,

    What are the odds that the guy in that picture loves these:

    “The company even got some good press recently, if you want to call it that. A new junk-food craze involves a bacon cheeseburger sandwiched between two Krispy Kremes (Original Glazed). It weighs in at 1,500 calories, give or take a few.”

    http://finance.yahoo.com/news/The-Tragedy-of-Krispy-minyanville-220090191.html?x=0

  98. lostinny says:

    101 Kettle
    Don’t try to squirm out of it. Take responsibility for your actions. Oh wait…

  99. lostinny says:

    102 Tosh
    So very scary.

  100. Comrade Nom Deplume says:

    So much for BaucusCare. The unions are opposed, so it isn’t going anywhere.

    http://politicalticker.blogs.cnn.com/

  101. bairen says:

    I gotta post something to offset those peopleofw site.

    6 women from Taiwan’s FHM top 100 list (including a Ukranian model who speaks fluent Mandarin) on a talk show posing on a row of toilets. The models/actresses show up about 1:45 into the video.

    I would love to have John put in his own subtitles.

    http://www.youtube.com/watch?v=uduu_9a7ULc&feature=player_embedded

  102. kettle1 says:

    Whats the load rating for the average toilet? Does Walmart sell reinforced toilets? It looks like they may have a niche market right under their nose!

  103. stan says:

    Pre-emptive Frank strike….

    Hoboken numbers were miserable, with a quick glance I saw virtually every sold property was a large loss for the seller, including this one:

    1500 washington street(hudson tea builidng, home of Corzine and Eli) #6U

    Last purchased for 728885 in 2007.

    Just sold for 630K.
    Hudson mls #90004191

  104. Escape from NJ says:

    Can someone give a quick pros and cons of 30 yr fix v. FHA? I know a big difference is down payment 20% v. 3.5%. I ask because I have a house in mind that I can cover the 20%, but is there a greater advantage going FHA. Thanks.

  105. kettle1 says:

    Escape:

    you cant do a 30yr fixed with FHA??? only variable?

  106. kettle1 says:

    FHA Limits
    Lending limits for FHA loans insured for NEW JERSEY counties.

    http://www.fha.com/lending_limits_state.cfm?state=NEW%20JERSEY

    County Name
    Single Family
    Duplex
    Tri-plex
    Four-plex

    ATLANTIC
    $453,750
    $580,850
    $702,150
    $872,600

    ATLANTIC CITY, NJ (MSA)
    BERGEN
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEW YORK-WHITE PLAINS-WAYNE, NY-NJ METRO
    BURLINGTON
    $420,000
    $537,650
    $649,900
    $807,700

    CAMDEN, NJ METROPOLITAN DIVISION
    CAMDEN
    $420,000
    $537,650
    $649,900
    $807,700

    CAMDEN, NJ METROPOLITAN DIVISION
    CAPE MAY
    $487,500
    $624,100
    $754,350
    $937,500

    OCEAN CITY, NJ (MSA)
    CUMBERLAND
    $405,000
    $518,450
    $626,700
    $778,850

    VINELAND-MILLVILLE-BRIDGETON, NJ (MSA)
    ESSEX
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEWARK-UNION, NJ-PA METROPOLITAN DIVISION
    GLOUCESTER
    $420,000
    $537,650
    $649,900
    $807,700

    CAMDEN, NJ METROPOLITAN DIVISION
    HUDSON
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEW YORK-WHITE PLAINS-WAYNE, NY-NJ METRO
    HUNTERDON
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEWARK-UNION, NJ-PA METROPOLITAN DIVISION
    MERCER
    $440,000
    $563,250
    $680,850
    $846,150

    TRENTON-EWING, NJ (MSA)
    MIDDLESEX
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    EDISON, NJ METROPOLITAN DIVISION
    MONMOUTH
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    EDISON, NJ METROPOLITAN DIVISION
    MORRIS
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEWARK-UNION, NJ-PA METROPOLITAN DIVISION
    OCEAN
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    EDISON, NJ METROPOLITAN DIVISION
    PASSAIC
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEW YORK-WHITE PLAINS-WAYNE, NY-NJ METRO
    SALEM
    $420,000
    $537,650
    $649,900
    $807,700

    WILMINGTON, DE-MD-NJ METROPOLITAN DIVISION
    SOMERSET
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    EDISON, NJ METROPOLITAN DIVISION
    SUSSEX
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEWARK-UNION, NJ-PA METROPOLITAN DIVISION
    UNION
    $729,750
    $934,200
    $1,129,250
    $1,403,400

    NEWARK-UNION, NJ-PA METROPOLITAN DIVISION
    WARREN
    $402,500
    $515,250
    $622,850
    $774,050

    ALLENTOWN-BETHLEHEM-EASTON, PA-NJ (MSA)

  107. syncmaster says:

    3 bedroom, 2.5 bath townhouse in P-way now listed for 219k.

    WTF????????? 219???????

    http://tinyurl.com/yjax9gh

    F me.

  108. grim says:

    Higher rate, PMI, and slightly more complex app process.

  109. kettle1 says:

    Grim,

    is a sellers rebate legit in PA?

  110. Escape from NJ says:

    Thanks Grim. So I assume if you have the funds to cover the 20% down, go 30 yr fixed.

  111. HEHEHE says:

    We must cover NJ Pensioners. They dedicated years f=of hard work and service to this state. The taxpayers benefited from the hard work. Now they must pay. It is only fair!

  112. Shore Guy says:

    Escape,

    Unless you want the option of walking away and having 17% in your pocket when you do.

  113. Zack says:

    #118

    If the opportunity cost of investing the balance (20% minus 3.5%) in a very conservative portfolio of stock, bonds and commodities beats the alternative (higher FHA rate and PMI) over a 10 year period, then why put down 20% down?
    Do the math and you will find out..

  114. BC Bob says:

    Sync [115],

    I sold a 3 bdrm, 2 bath townhouse in P-Way, mid 80’s for 159K. Heading back to Ronnie Reagan?

  115. lostinny says:

    115 Sync

    I saw a similar one a little while back for 210 but it needed a lot of work.

  116. HEHEHE says:

    BC,

    You mean we’re headed back to morning in America?

  117. 3b says:

    #113 FHA Does fixed rated too.

  118. syncmaster says:

    lostinny which part of pway?

  119. syncmaster says:

    bc bob 122 … i hope not.

  120. BC Bob says:

    Sync [127],

    Society Hill- That was my first flip. Gotta luv Hov.

  121. lostinny says:

    126 Sync

    Sorry I really don’t know. I didn’t believe it was for real so I didn’t investigate.

  122. syncmaster says:

    BC Bob 128.. aah. My mom owns in the adjacent Hov built SFH community. Quality isn’t great but hardly falling apart either.

  123. Shore Guy says:

    Ronald Reagan: Morning in America

    B.O.: Mourning in America.

    At least we still have hope, or was that hopium, to get us through.

  124. syncmaster says:

    lost 129 oh ok. thats cool.

  125. Schumpeter says:

    3b (44)-

    None of this will stop until we’ve completely destroyed our country. Too bad the kill shot gets delivered to our kids and grandkids.

    To paraphrase Churchill, we’ve established that we’re wh0res. Now, we’re just haggling over price.

    “Don’t fight it, you cannot so why bother. Go FHA, with as little down (3.50%),and keep your money.”

  126. kettle1 says:

    CLot,

    what sorts of games are going on with VA loans right now?

  127. Schumpeter says:

    I think John has joined Booyah Bob and Listen in the new FL growth industry of boarding up bank-owned homes.

  128. Comrade Nom Deplume says:

    [119] HEHEHE

    “They dedicated years f=of hard work and service to this state.”

    Debt=wealth
    Taxes=savings
    Breathing=hard work

  129. HEHEHE says:

    Shore hopium is doing wonders for the stock market.

  130. Comrade Nom Deplume says:

    You knew this was coming someday:

    http://money.cnn.com/2009/10/14/news/companies/powerball_mega_millions/index.htm?cnn=yes

    As chifi would say “THE END IS . . . “

  131. Schumpeter says:

    vodka (134)-

    VA guidelines read a lot like FHA (without the shenanigans). It’s really not a high-volume market at this time.

    Everyone should take note that a handful of FHA lenders are slamming the door a bit…just as we see the horses have already escaped the barn and are about a mile down the road. Coming this Friday at selected lenders:

    FICO of 620-600 = 1 point surcharge

    FICO of 620-

  132. Schumpeter says:

    vodka (72)-

    I think Chuck Barris needs to develop a new game show:

    “Gambling with Pension Money”

    “The urgent need for outsize returns by these vast public pension funds, which must hit high investment targets year after year to keep pace with rising retirement costs, is in turn fueling a renewed appetite for risk on Wall Street.”

  133. Shore Guy says:

    HEHE,

    If the market doubles and the dollar halves, where are we?

  134. Victorian says:

    This is the worst time to buy a house.

    Low Interest Rates – You cannot refinance later on at lower rates. Plus, this increases your competition’s purchasing power and hence you are overpaying for that house.

    Tax Credit – Assuming that the tax credit will expire at some point in time, you have to discount this amount when you are selling the house. Again, you are overpaying for that house by the amount of the tax credit.

    The best time to buy a house would be when interest rates are high and flat, especially if you have a big downpayment saved up.

    Worst time to buy a house, but a great time to sell it.

  135. 3b says:

    #133 Agreed.Take care of your own, thats all we can do.

  136. Schumpeter says:

    JS (92)-

    Leonard Lance is my congresscritter.

    I’ll take a year of the bonanza a 15K homebuyer credit will trigger, then make for Chile in 2011 with all my winnings.

    BTW, I will also jingle mail my house and office building keys.

  137. Schumpeter says:

    3b (93)-

    Lowballing is a waste of time. Every seller out there (even ones who are short), are digging in. They all feel the tax credit will go another year in some sort of form.

    Better to try to get something done now at market value, because if the extension involves removal of the first-time buyer requirement and/or an increased credit amount, it’s off to the races we go.

  138. 3b says:

    $142 Those items used to matter, not any more. The govt will continue to manipulate. Prices etc. do not really matter any more, as all you are doing is renting the house from the govt for a 15 or 20 year period.

    Thats why if you plan to buy do it with as little skin in the game as possible. Once you put that 20% down, chances are you will never see it again.

  139. Schumpeter says:

    lost (97)-

    Tell your LL “no”, and refuse to pay it.

  140. 3b says:

    #145 Why would the removal of first time buyer credit matter? Vacation homes?

  141. lostinny says:

    147 Clot

    I tried that. They told me I had no choice.

  142. confused in NJ says:

    Interesting complexity on Homestead Rebates (HSR’s). If you moved in 2006 from a higher property tax area to a lower property tax area, your rebate gets flagged and held. They use 2006 as some type of base year, and if it’s higher then 2008, HSR chokes. It takes 45 days in review to resolve issue once you realize it is occurring.

  143. ruggles says:

    148 – trade up buyers would get it too

  144. BC Bob says:

    Promise, prayer, hope, freeze, adjustment, delay, assumption, pipe dream, illusion, probability, maneuver, deception, fraud, and a sham.

    It’s gonna be a long walk home.

  145. Schumpeter says:

    escape (112)-

    DO NOT deploy capital in a deflationary credit crisis.

    Put down as little as humanly possible, and walk away if it doesn’t work out.

  146. ruggles says:

    so far, seems like the best time to buy a house since peak was mid 08 to early 09. won’t be better than that til the incentives are gone.

  147. BC Bob says:

    “If the market doubles and the dollar halves, where are we?”

    Shore,

    On the cusp of mayhem in the currency markets which will cause stock market dislocation.

  148. 3b says:

    #154 Peak Was Spring 06.

  149. 3b says:

    #151 Good point.

  150. ruggles says:

    Forget 219k townhouses in Piscat, there’s a condo in Chatham at 227k. can’t wait to see a price in Chat with a 1 in front of it. and not a million plus.

  151. Schumpeter says:

    lost (149)-

    You are in control and hold all the cards.

    You can also do 3b’s play and re-up for a year, and withhold money at the end.

    No LL in his right mind will take you to Special Civil Part over this.

  152. ruggles says:

    Forget 219k townhouses in Pway, a condo in Chatham now at 227k. can’t wait to see a price in Chat with a 1 in front of it. thats not over a million.

  153. BC Bob says:

    Clot [153],

    Unless one has the intention of walking away, you want to put down as much as possible in a deflationary environment. Debt sucks in this scenario. On the flip side, in an inflationary period, put down as little as possible. Inflate the debt away.

  154. Schumpeter says:

    Lemmings are bidding it up to 10K.

    A feeding frenzy of dolts.

  155. Schumpeter says:

    BC (160)-

    For sure. Right now, I believe anyone who buys a home should have walking away firmly in mind as a strategy.

  156. #141 & 155 – Good lord. I hadn’t checked out JPY/USD in a few. Puts the rally in equities into perspective. The dollar is toast.

  157. JS says:

    144 – Clot

    I think I may just end up being part of that frenzy. Plan was to buy a place in Hunterdon or Somerset (along route 78) in 2011. If this credit goes into effect it does start to border on too good to pass up and will most likely cause us to buy 6 months earlier then planned.

    We are looking in the high 3’s low 4’s. Do you think it is better to pull the trigger next year with the tax credit / FHA. Or wait for the frenzy to be over and look to lowball in 2011? We have the 20% DP so our choice really isn’t contingent on FHA.

  158. Sean says:

    ohh soo close. DOW 9,999.61

  159. Schumpeter says:

    JS (164)-

    When this thing finally collapses, nobody will be wanting to buy a house. They’ll be too busy searching for their next meal and keeping watch over whatever personal perimeters can be established.

    I’d wait for the expanded tax credit (it’s coming), then dive in. Put down as little as possible, and don’t get attached to your house…you may end up walking away from it.

  160. BC Bob says:

    Clot [162],

    I agree, It should be first line of defense.

  161. Alap says:

    Sync,

    Whats the address of that townhouse?

    The $210k one someone was talking about that needed alot of work, I think that was in Hidden Woods, off Stelton/Washington.

    My sister just purchased in Maple Grove.

  162. 3b says:

    160/162 I will keep my money delfation/inflation or not. Walking away is always an option, but no need to. With FHA I am a client of the U.S. govt, and I will have my mtg modified to suit my active and fun filled lifestyle, or just because I threaten to walk away. No way they will throw any one out.

  163. BC Bob says:

    3b [169],

    I like it. Heads I win, tails you lose.

  164. Eagle says:

    Does anyone know what the proposed new income phase-out for the extended first-time buyer tax credit will be? Now it is currently approx. 150k for a married couple, but the linked articles indicate the proposed extension will eliminate the income cap for “all but the highest” income earners. Those types of phrases always seem to include people like me (moderately successful professionals at Manhattan firms). Does anyone know what this new “expanded” income cap might be? 250k for a couple? 350k? 500k? 1MM?

  165. BC Bob says:

    “Just as the Dow clips 10K!”

    PGC [170],

    Is there any significance to Dow 10K?

  166. Shore Guy says:

    From Tice above:

    “Not only does Tice think the market will retest the lows, he thinks the next crash will make the one we just lived through look minor. “We don’t think this market will bottom until we get to book value,” which is about “3100 on the Dow,” he says (with a straight face.) ”

    And all this time I thought I had a dark view expecting the Dow to hit 4800.

  167. Sean says:

    BC Bob

    re: Is there any significance to Dow 10K?

    Only if they roll out a new sampled/mixed version “Happy Days are here again” sung by Miley Cirus.

    They will be popping corks over on CNBC and the rest of the MSM for sure.

    Let’s see if the politicians try and pick up on it too.

  168. 3b says:

    #171 Exactly.

  169. 1987 Condo Buyer says:

    Is America Energy Self-Sufficient?

    “As for the US, we may soon be looking at an era when gas, wind and solar power, combined with a smarter grid and a switch to electric cars returns the country to near energy self-sufficiency.

    This has currency implications. If you strip out the energy deficit, America’s vaulting savings rate may soon bring the current account back into surplus – and that is going to come at somebody else’s expense, chiefly Japan, Germany and, up to a point, China.”

    http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6299291/Energy-crisis-is-postponed-as-new-gas-rescues-the-world.html

  170. Shore Guy says:

    Well, if the Dow is back to 10k, perhaps we can get prople to stop pumping free money into the system.

    Naw, I have a better chance of having Sela Ward stop by today. Gary, if she does, you can video tape.

  171. BC Bob says:

    Sean [175],

    Yeah, they’ll party like it’s 1999.

  172. kettle1 says:

    177 condo buyer

    sounds nice. That will happen right after Sela stops by Shore’s place and gary starts filming.

    There are about a 1000 externalities that arent being considered in that piece.

  173. Shore Guy says:

    Fat? Fat?

    http://today.msnbc.msn.com/id/33307721/ns/today-today_fashion_and_beauty/?GT1=43001

    Clearly, her bosses never went to the WalMart people Website.

  174. HEHEHE says:

    I like Tice but he’s about as ultra-bear as you can get; that being said his arguments tend to be pretty rationale.

  175. Shore Guy says:

    Ket,

    You mean she is not coming over right now? Later? Tomorrow! Right?

  176. yikes says:

    sometimes you’re funny, SAS, but you’re way, way off here

    sas says:
    October 12, 2009 at 10:40 pm

    looks like we got Mike Tyson crying like a baby all over the news.

    Mike Tyson is and always has been a nothing. He was created by boxing promotors, pinned up against people whom took a dive on purpose. Its all made up, fake, & phony.

    and too boot, the sap has a tattoo of Mao… who the heck does that?

  177. Jim says:

    Just drove by the house. No need for an appointment to see the inside. There is a huge power line tower directly behind the back yard. You can’t see it from the photo they took of the house.

  178. Shore Guy says:

    Jim,

    It reminds me of this:

    http://news.bbc.co.uk/2/hi/uk_news/england/kent/8282368.stm

    “An advert for an “exceptional fisherman’s cottage” in Kent has been criticised for failing to mention the nuclear power station on its doorstep.

    The three-bedroom “not to be missed” bungalow at Romney Marsh, Dungeness, is being sold for £247,000.

    Estate agent Geering & Colyer points out its proximity to a nature reserve and photos show it in rural isolation.

    But New Romney Town Council said it was “disingenuous” not to mention its neighbours, Dungeness A and B.”

    snip

    Do the RE agents think people are so stupid as to notnotice such things? The backlash in response to the duplicity cannot be worth the extra traffic.

    Then again, maybe people are THAT stupid.

  179. Shore Guy says:

    If one goes to the BBC site and plays the video, it is quite outlandish.

  180. Sean says:

    Here is the New Jersey version of that cottage in the UK.

    only 324k.

    click MAP view then Satellite.

    http://www.trulia.com/property/map/1088906121-740-S-River-Dr-Forked-River-NJ-08731

  181. I’ve put up a blog for those that are making, or are considering making the move out of NJ.

    http://escapefromjersey.blogspot.com/

  182. syncmaster says:

    Alap, idk the address.

  183. Victorian says:

    Some of Treasury Secretary Timothy Geithner’s closest aides, none of whom faced Senate confirmation, earned millions of dollars a year working for Goldman Sachs Group Inc., Citigroup Inc. and other Wall Street firms, according to financial disclosure forms.

    The advisers include Gene Sperling, who last year took in $887,727 from Goldman Sachs and $158,000 for speeches mostly to financial companies, including the firm run by accused Ponzi scheme mastermind R. Allen Stanford. Another top aide, Lee Sachs, reported more than $3 million in salary and partnership income from Mariner Investment Group, a New York hedge fund.

    As part of Geithner’s kitchen cabinet, Sperling and Sachs wield influence behind the scenes at the Treasury Department, where they help oversee the $700 billion banking rescue and craft executive pay rules and the revamp of financial regulations. Yet they haven’t faced the public scrutiny given to Senate-confirmed appointees, nor are they compelled to testify in Congress to defend or explain the Treasury’s policies.

    http://www.bloomberg.com/apps/news?pid=20601087&sid=abo3Zo0ifzJg

  184. Shore Guy says:

    Sean,

    Is that house right near Oyster Creek, perhaps? I used to ride my bike down there.

  185. Schumpeter says:

    vic (192)-

    Once can only hope that we eventually are treated to an updated version of the greatest live TV show ever, Christmas With the Ceaucescus.

  186. chicagofinance says:

    This one is utterly Chicago.

    One the menu, one of the choices is “Cellmates”, which is two weiners.

    WSJ
    PAGE ONE
    OCTOBER 13, 2009

    Slaw and Order: Hot-Dog Stand in Chicago Triggers a Frank Debate
    ‘Felony Franks’ Is Staffed by Ex-Cons, but Some Neighbors Don’t Relish the Name
    By JULIE JARGON

    CHICAGO — When James Andrews opened a hot-dog stand on this city’s rough West Side, he thought he was doing a community service by hiring ex-convicts. But some in the neighborhood think the name he chose — Felony Franks — is a crime.

    An alderman has refused Mr. Andrews permission to hang a new sign or build a drive-through lane. A pastor accused the restaurant owner, who is not an ex-convict, of “pimping out” the community. Members of a neighborhood association have vowed to stay away from Felony Franks until the name is changed and the décor — including paintings of cartoon hot dogs in prison stripes — is removed.

    Former inmates serve up Misdemeanor Wieners, Guilty Gyros and other items at this prison-themed hot dog stand on Chicago’s West Side. Not everyone is amused. WSJ’s Julie Jargon reports

    “I don’t understand it,” Mr. Andrews says. “I really don’t.”

    The 64-year-old businessman has long employed ex-convicts at his main business, a company that supplies paper goods to restaurants.

    He says he thinks people deserve a second chance and felons need stable jobs so they don’t add to homelessness. He thought of opening a hot-dog stand three years ago while driving past one. The name “Felony Franks” just popped into his head, he says.

    He spent more than $160,000 to refurbish a shuttered Polish-sausage stand on a busy corner in an area that’s a mix of new condos and stately old homes, subsidized housing and boarded-up storefronts. Mr. Andrews hired a dozen ex-cons to cook and serve frankfurters, sausages, steak sandwiches and french fries sliced from raw potatoes.

    Customers enter a cramped space framed by cinder-block walls, with no tables or chairs. Near the entrance hangs a mock list of Miranda rights: “You have the right to remain hungry. Anything you order can and will be used to feed you here at Felony Franks.”

    Servers standing behind bulletproof plastic — standard for stores in the neighborhood — ask customers, “Are you ready to plead your case?” Among other dishes, the menu lists the Misdemeanor Wiener and the Chain Gang Chili Dog. Side orders, such as fries, cole slaw and garlic bread, are dubbed “accomplices.” The restaurant’s slogan is, “Food so good it’s criminal.”

    Jerry Tassos, left, and owner Jim Andrews clean the sidewalk in April as they prepare to open ‘Felony Franks.’ The Chicago hot-dog stand employs released convicts and has stirred up community opposition to its name and advertising efforts.

    The Chicago hot-dog stand employs released convicts and has stirred up community opposition to its name and advertising efforts.

    Some customers just laugh. Others who live nearby think the penal puns are an affront to a community grappling with crime and trying to change for the better.

    Michael Cunningham, a 10-year resident and member of the Homeowners of West Town, says the neighborhood already is home to several drug-rehabilitation centers and facilities for former prisoners. He says the neighborhood group successfully fought the establishment of another halfway house and will soon get a new grocery store. “There are positive things happening here and Felony Franks is a step back,” says Mr. Cunningham, a self-employed career consultant.

    Other restaurants employ former felons. Delancey Street in San Francisco is operated by a foundation that assists former convicts, drug addicts and homeless people. Inmates staff the Mates Inn on the administrative campus of the state corrections department in Trenton, N.J. Those establishments have existed with little controversy.

    Felony Franks encountered friction even before it opened in July. Last year, after securing building permits from the city, Mr. Andrews visited Robert Fioretti, the alderman who represents the area around Felony Franks. “I don’t like the name,” Mr. Andrews recalls the alderman saying.

    Mr. Andrews needed Mr. Fioretti’s approval to install a sign in an empty frame that juts from the building. He estimates he could bring in 15% to 20% more revenue with more visibility from passing cars. When the sign company he had paid $1,700 told him permission had been denied, Mr. Andrews called the alderman’s office. A staffer, he says, told him Mr. Fioretti wouldn’t approve the sign because he didn’t like “Felony Franks.”

    Later the alderman proposed a city ordinance that would prohibit signs extending 7 inches or more from a building’s facade on a small stretch of street where Felony Franks is located. The City Council has yet to vote on the proposal. Mr. Andrews calls it a “direct attack” on his business. Mr. Fioretti says it’s part of a beautification project and “has nothing to do” with the hot-dog stand.

    “He likes to create controversy over the sign and the sign is not the issue,” Mr. Fioretti says. “I’m all for hiring ex-offenders, but why give more stigma to the fact? We’re here to assimilate people into our society and not have them stand out like a sore thumb.”

    Shortly after the restaurant opened, the local homeowners group called a meeting and invited Mr. Andrews. His wife, Mary, says she warned him, “You’re walking into a firing squad.”

    More than 70 people attended. Among those who voiced concerns was the Rev. Michael Pfleger, an activist Catholic pastor from Chicago’s South Side. Father Pfleger accused Mr. Andrews of exploiting the African-American men working for him. “He screamed at me, ‘You are a pimp,'” Mr. Andrews recalls, an account Father Pfleger confirms. When Mr. Andrews took the floor later, he says he screamed at the priest, “You don’t know me…I am not a pimp!”

    Kevin Jones, 42, who works at Felony Franks, says he doesn’t feel exploited. “Working here allows me to provide for myself and my family,” says Mr. Jones, who says he used to sell crack and served two years’ probation for possession of a controlled substance. “I’ve lived in this neighborhood for 15 years and there’s gunfire every other day and you never hear anything about that, but all of a sudden there’s all this hoopla about a hot-dog stand?”

    Mr. Fioretti has also informed Mr. Andrews he will oppose a curb cut needed to build a drive-through lane, which the alderman says would pose a safety hazard to people at a nearby bus stop. Mr. Andrews says he has no plans to litigate. But the Institute for Justice, a civil-rights law firm in Washington, D.C., says it has contacted him about fighting the sign ordinance as a violation of his First Amendment rights.

    Despite the controversy, Mr. Andrews says he’s rung up about $30,000 in sales each month since opening, and has received more than 1,000 job applications from former felons. He envisions opening more Felony Franks in Chicago and says he’s already received dozens of unsolicited requests from prospective franchisees across the U.S.

    He says he won’t change the name of his business for anyone. “I won’t even consider it,” he says.

  187. Schumpeter says:

    Mr. Durden, explaining the obvious:

    “Therefore, we present the Dow over the last decade indexed for the DXY, which has dropped from 100 to about 75. On a real basis (not nominal) the Dow at 10,000 ten years ago is equivalent to 7,537 today! In other words, not only have we had a lost decade for all those who focus on the absolute flatness of the DJIA, but it is also a decade where the US Consumer has lost 25% of purchasing power from the perspective of stocks! You won’t hear this fact on the MSM.”

    http://www.zerohedge.com/article/dow-10000-oh-wait-make-7537

    Best of all, less than 10 oz of shiny buys the DOW. We’re making progress!

  188. Veto That says:

    “I’ve put up a blog for those that are considering the move out of NJ.”

    watergapnomad, This is a blog for people who are considering the move out of NJ.

  189. Comrade Nom Deplume says:

    CNBC describes this as lunacy, and it is, but given the facts, it is also perfectly plausible.

    http://www.cnbc.com/id/33310096/

    In what has become a surreal world, cash is king, a cratering market is “hot” even if prices aren’t high, and buyers that would be courted here, are shunned. What happens in Vegas may not stay in Vegas.

  190. Schumpeter says:

    plume (198)-

    It makes perfect sense. In fact, all this will happen here someday.

  191. ruggles says:

    Actually, “This is a blog for people who are considering the move out of NJ”…but never will.

  192. BC Bob says:

    “Bruce Wasserstein, a Wall Street investment banker who helped pioneer the hostile takeover in the 1980’s and turned the mergers and acquisitions business into a high art, died Wednesday.”

    http://dealbook.blogs.nytimes.com/2009/10/14/bruce-wasserstein-lazard-chief-dies/?hp

  193. Escape from NJ says:

    Watergap (189)

    Dude, you stole my handle. You will be hearing from my lawyers.

  194. meter says:

    I don’t understand this 3.5% down strategy. Doesn’t the PMI kill you on the payments?

  195. Sean says:

    re: #201 -Captain Lou Abano Dead at 76

  196. Veto That says:

    Meter, when you do FHA, they PMI is capped at a more reasonable level.

  197. #204 – NO! Who’ll stop Cindy Lauper acting so crazy and having fun!

    Seriously, he was 76? Wow, I had no idea.

  198. Sean says:

    Corzine must be worried so he is calling in the ONE again. Obama will be in Hackensack on October 21 to stump for Corizne.

  199. HEHEHE says:

    The Great One’s go in pairs

    Captain Lou Albano Dies at 76

    http://buzz.yahoo.com/buzzlog/93095/?fp=1

  200. skep-tic says:

    #154

    “so far, seems like the best time to buy a house since peak was mid 08 to early 09. won’t be better than that til the incentives are gone.”

    I believe that with respect to much of the country, but I was bidding on houses in Westchester and CT from Nov 08 to March 09 and sellers almost universally were in dreamland at that time. We didn’t have the foreclosure volume that existed in the west at that time either. I ultimately renewed my lease because I could not find sellers who were serious.

  201. skep-tic says:

    #172

    “Does anyone know what the proposed new income phase-out for the extended first-time buyer tax credit will be? Now it is currently approx. 150k for a married couple, but the linked articles indicate the proposed extension will eliminate the income cap for “all but the highest” income earners.”

    ************
    If you can afford a house in NJ/NY/CT, you probably won’t qualify!

  202. Great stuff. Nice to read some well written posts. A long way between them.

  203. I found your blog on google and read a few of your other posts. I just added you to my Google News Reader. Keep up the good work. Look forward to reading more from you in the future.

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