NJ/NY Metro prices down 3.4% in August

From the Record:

Home prices dropped 3.4 percent in August

What’s new: Home prices in the New York metropolitan area, which includes North Jersey, dropped 3.4 percent in August, compared with August 2010, the Standard & Poor’s/Case-Shiller index reported on Tuesday.

Nationally, home prices declined 3.8 percent year over year. However, prices were up slightly from July to August, both nationally and in the region.

What it means: Prices in the area have returned to the levels of spring 2004, and are down almost 22 percent from the market peak in mid-2006. Nationally, prices are back to mid-2003 levels, and about 31 percent below peak levels.

Home prices have been under pressure because of elevated unemployment, which makes it more difficult for potential buyers to afford homes, as well as tighter mortgage standards and a continuing high percentage of short sales and foreclosures on the market. These distressed properties tend to sell at a discount.

What’s happening locally: Single-family home prices slid 4.5 percent, to a median price of $480,000, in Bergen County from August 2010 to August 2011, while the number of sales rose 13 percent. Prices dropped 8 percent, to a median $259,169, in Passaic County, while the number of sales declined 10 percent.

What they’re saying: “Whether prices have established a bottom depends on future foreclosure activity, which is likely to increase as servicers address the legal/administrative issues that have cropped up over the past three years.”

This entry was posted in Housing Bubble, Housing Recovery, New Jersey Real Estate. Bookmark the permalink.

148 Responses to NJ/NY Metro prices down 3.4% in August

  1. funnelcloud says:

    first today

  2. grim says:

    From HousingWire:

    FHFA: August home prices down 0.1% from prior month

    August home prices dipped 0.1% from July on a seasonally adjusted basis and fell 4% from year-ago levels, according to the Federal Housing Finance Agency.

    The federal regulator and conservator of mortgage giants Fannie Mae and Freddie Mac said its home price index is now 19% below peak levels of April 2007 and at a level last seen in February 2004.

    The August drop is the first monthly decline reported since March. Prices edged higher in the months heading into the summer season.

  3. grim says:

    From Time:

    Drop in Housing Prices Continues to Slow

    Housing prices of 20 cities were flat from July to August, according to the latest S&P/Case-Shiller housing index. Year-over-year and on a seasonally adjusted basis, the composite 20 index was down 3.8% from August of last year. That’s a slowdown from the previous year-over-year drops of 4.1% in July and 4.6% in June.

    From that viewpoint, it looks like the tumble in housing prices might be slowing. The 20-City composite appears to have bottomed out in March. The 3.8% year-over-year drop, though, was worse than consensus expectations, which were projecting a decline of 3.5%. In other words, the outlook is slightly better, but not slightly better enough.

    What’s more troubling is that we’ve recently seen record low mortgage rates. Econ 101 tells us that if rates drop, prices should rise. The fact that we can’t do any better than these mild signals of recovery even as we inject the market with a steroid of cheaper money shows that something in the housing market is still fundamentally broken. Is it unemployment, lack of credit, or lack of consumer confidence? Possbily all three.

  4. grim says:

    From the WSJ:

    Behind the Numbers: Home Prices Tread Water

    Is it a glimmer or more gloom? That’s the question after today’s release of S&P/Case-Shiller’s home price data showing a 0.2% monthly gain in August.

    You know the housing market is in bad shape when we’re cheering such seasonal growth, but there’s been no spring in real estate’s step lately. After seasonal adjustment, the 20-city composite index was essentially flat. And prices compared to last year declined 3.8%.

    Another monthly index showed similar weakness. The Federal Housing Finance Agency said home prices slipped 0.1% on a seasonally adjusted basis, and 4% from 12 months ago; the index is calculated from the purchases prices of homes backed by mortgages sold to or guaranteed by Fannie Mae or Freddie Mac.

    Industry watchers seem to largely agree—it’s another gloomy day for housing:

    Paul Ashworth, Capital Economics: ”The latest report on house prices from Case-Shiller suggest that the housing market has been a little bit softer than previously thought. In seasonally adjusted terms, the Case-Shiller 20-City house price index was broadly unchanged in August and prices are now estimated to have fallen slightly in June and July, in stark contrast to the original estimates that pointed to modest price increases.”

    Michelle Meyer, BofA Merrill Lynch Global Research: “A broad range of home price measures show that home prices have not yet bottomed. Both the Case Shiller and FHFA index, released this morning, showed a slight monthly drop in prices in August, leaving prices down 3.8% and 4.0% y/y, respectively. This is in line with the 4.4% y/y decline in the CoreLogic index. The continued decline in home prices is a function of the large imbalance between supply and demand in the housing market. There is too much inventory, particularly of distressed properties, relative to the pace of home sales, which means that prices must fall further to equilibrate the market.”

    Dan Greenhaus of BTIG LLC: “We certainly believe the bulk of the decline in housing is behind us and indeed, one might even say that ‘housing’ is more likely to improve from here. But given the overwhelming level of inventory that remains on the market and the unyielding deleveraging impulse on the part of consumers, further price declines seem almost assured in order to help clear the market.”

  5. Slow, agonizing death.

    This is the best case scenario.

  6. 3B says:

    #3 Is it unemployment, lack of credit, or lack of consumer confidence? Possbily all three.

    And in our area can we add two more,? One prices in many instances are still too high, so fence sittersa are saying why bother. And two property taxes are out of control. The fall in mtg rates is eaten up by the rise in property taxes.

  7. gary says:

    Prices in the Northern NJ have returned to the levels of spring 2004, and are down almost 22 percent from the market peak in mid-2006.

    And of course, they won’t go any lower; right? Right? I said right? Come to papa, bitch!

  8. gary says:

    The fact that we can’t do any better than these mild signals of recovery even as we inject the market with a steroid of cheaper money shows that something in the housing market is still fundamentally broken.

    Gee, what a f*cking rocket scientist.

  9. wksgtffue says:

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  10. JJ says:

    Spring 2004 there were lines out the door and bidding wars for houses. How exactly is that bad new? Maybe back to Christmas week 1999 prices when people were filling bath tubs with water waiting for Y2K to hit might be a better sign of a bottom.

  11. Comrade Nom Deplume says:

    I BTFDs. Now I wish I bought more.

  12. Comrade Nom Deplume says:

    (11) JJ,

    How did you know about my tub?

    I actually stocked very little and went on a holiday trip to Mass for Y2K. I was pretty confident because I was seeing banks prepare 10 years in advance.

    But I did bring a piece with me, just in case.

  13. funnelcloud says:

    Home prices have fallen to 2004 levels,,,, so Why haven’t the property taxes ????
    Taxes are killing the NJ market, as long as local gov’ts continue use peoples homes as their personal piggy banks, things will only get worse from here on….Towns have to cut property taxes “period” and work to get revenue from other sources. Problem is that it will require real work on the part of our governing body, (something their just not use to.) They’ve been pigs at the trough to long have no other real idea’s other than to tax the home more. People have always found ways around taxes, If you tax “gas”,,, people carpool or buy smaller cars, If they overtax goods, People go to PA or buy online. Problem is no other source of revenue has been as consistent as a home property tax, until now, Now its the home, The towns drained the well dry , the investments are not growing any longer so the people are not going to pay the ransom money to support a losing proposition.

  14. Comrade Nom Deplume says:

    Anyone recommending AMZN right now?

  15. Juice Box says:

    re # 3 – “Drop in Housing Prices Continues to Slow”

    Interesting on another blog a Japanese person wrote in that Real Estate Prices in Japan fell about 20% since last year, while continuing to drop about 5% a year for the last 20 years, and then went onto say it can continue to reach new bottoms for as long as anyone can imagine.

  16. funnelcloud says:

    Hey where’s Mike ???? No good morning NJ!! today

  17. Comrade Nom Deplume says:

    I think that an effective and unusual way to combat local governments is to take advantage of joe biden’s statement about crime, and flood municipalities with applications for purchase and carry permits. That scares cops, who want to be the sole source of protection, and scares pols since gun owners tend not to be sheeple.

  18. Comrade Nom Deplume says:

    (17) funnel,

    Maybe he slipped over the border in the night

  19. Juice Box says:

    Nom – AMZN margin compression will kill them with a P&E of 89. They project losses or small gains for 4th quarter, does not match with my level of comfort for a $200 stock.

    The rest of the retailers are also onto their game now, I am not so sure they will kill it this Holiday Selling Season. Their new tablet the Fire is cheaper, but is still no iPad. There is going to be a slew of new better tablets coming in the next year, all with NetFlix, if people think Amazon is going to kill it with subscription streaming media then buy them. I don’t think they will with only 11,000 offerings in their library.

  20. A.West says:

    Juice Box, from yesterday re private jets and how the wealthy relate to air travel.
    Private jets are for the top 0.5%, and mostly for folks who are in that zone every year. Keep in mind that the top 1% aren’t the same people every year. A football player may only stay in for a few years. A guy selling his company, or an employee cashing in stock options may only hit the top 1% for one year. My wife and I have been on the cusp for the last few years due to a combination of salary, bonus, capital gains. But after she just quit her job, we’ll probably be out beginning in the 2012 tax year, unless she finds something good, worth working at half-pay for. (You see, at our upcoming marginal tax rates, my wife would only get to keep about half of what she makes).

    We spent too many years remembering how hard it was to save our first $10k to ever pay $7k out of pocket for a business class flight, or spend $10k (or whatever) on a charter flight. My company, still run by its founder, and partly employee owned, also refuses to buy business class except in unusual situations (international flight going straight into a meeting). If someone asks for business class, they ask – “which ticket would you buy if it was your money?”

  21. gary says:

    Indeed, we have no control over property taxes so the fat f*cking municipal slobs can continue to stock up on entenmanns and frito lays without worry. So, f*ck em… don’t buy a house. Maybe when our children reach adulthood, they’ll be giving the houses away just so someone is willing to pay the taxes. What a bunch of f*cking dolts… from the clueless sellers to the industry sluts* to the politicians. As long as their interests are at hand, nothing else matters. F*ck ’em all.

  22. funnelcloud says:

    Comrade #18

    I would enthusiastically embrace our constitutional right to keep and bear arms through a state issue’d carry permit but unfortunately that will “NEVER NEVER NEVER NEVER, happen in the people’s republic of NJ, You should consider yourself fortunate that we don’t have our police running around asking for your “ID papers” at the local super market. Police are no longer the protectors of the general public, They are there to protect the officials who pay their salaries/pensions from the public, so issuing carry permits to the public would not be in the interest of either.

  23. gary says:

    grim, unmod me…

  24. 3B says:

    #20 Juice; And every Fire tablet they sell will be at a loss.

  25. joyce says:

    (14) funnel

    I agree except when you say towns should cut property taxes and find another revenue source. Cut property taxes and just spend less. Salaries/benefits/services need to be lowered.

  26. gary says:

    Rajat K. Gupta, a former Goldman Sachs director and McKinsey & Company chief executive, surrendered to the Federal Bureau of Investigation on Wednesday morning to face charges of insider trading, the latest development in the government’s multiyear crackdown on illegal activity on Wall Street.

    Assign him to D block, general population and make perform every act like in the HBO series, “Oz.” Then, bust his fingers with a ball-peen hammer.

  27. JJ says:

    I don’t really think you should count your spouses income. You are in or out. This Household income stuff gets silly. I guess techinically when I moved back home for a while in my late 20’s and my younger sisters was also college educated and working and my Mom was sill working the Census might say the Household income for that address is high. Heck I know Indian Families in NJ in town homes where they jam parents, grandparents and kids all under one roof. You might have 7 full time working members of a single family under one roof.

    I have been to country clubs, bars, reunions types of places where people brag about what they make. Usually, stuff like cap gains, interest income, spouses income don’t count. You can only really brag about your own income. Last two years with my bnod and stock trading I have been making close to 20K a month on cap gains and interest. This year not nearly as much. But I can’t tack that on to income. Can go to a person hey I know you make 500K salary but if you count my beanie babies sales and other nonsense I make a little more. Kinda kooky. But that is how it is. Indians are even stricter. They just count the mans base straight up. Stuff like stock, bonus, don’t even count. Kinda like what is your base salary a year.

    I don’t think a large amount of people earn a base on their own that puts them in the top 1% in a secure steary job. Most of top 1% are two income or maybe in a hot profession of the moment like Mortgage brokers in 2005 or commodities traders in 2010 with no gurantee the gravy train will last

    A.West says:
    October 26, 2011 at 10:03 am
    Juice Box, from yesterday re private jets and how the wealthy relate to air travel.
    Private jets are for the top 0.5%, and mostly for folks who are in that zone every year. Keep in mind that the top 1% aren’t the same people every year. A football player may only stay in for a few years. A guy selling his company, or an employee cashing in stock options may only hit the top 1% for one year. My wife and I have been on the cusp for the last few years due to a combination of salary, bonus, capital gains. But after she just quit her job, we’ll probably be out beginning in the 2012 tax year, unless she finds something good, worth working at half-pay for. (You see, at our upcoming marginal tax rates, my wife would only get to keep about half of what she makes).

  28. JJ says:

    The tub thing was so stupid since water had nothing to do with computers. You can have a massive black out and water runs. If it makes you fell better back in the mid 90s when DTCC which settles traders for all of wall street updated the systems for y2K they did if for an extra digit for the next event which is y10K. So in 7,989 years from now nancy boys won’t have to fill up their bath tubs and run out and get cash. But they did not prepare for y100K. So in the year 97,989 here we go again!

    Comrade Nom Deplume says:
    October 26, 2011 at 9:41 am
    (11) JJ,

    How did you know about my tub?

    I actually stocked very little and went on a holiday trip to Mass for Y2K. I was pretty confident because I was seeing banks prepare 10 years in advance.

    But I did bring a piece with me, just in case.

  29. yo says:

    In south jersey where my second home is,used home prices are same price as to new homes.Home buyers tend to go for the new homes instead of the used for the same price and the developer gives incentives like,finished basement and a free morning room.Why will you buy a used house if you can get all this for the same price on a brand new home?

  30. funnelcloud says:

    Joyce #25
    Though I agree with you 125% about spending less. the reality is that local gov’ts are not going to spend less, We have these problems and obligations because for the last 25 years our representatives have made unrealistic promises to police unions, teachers unions, and to themselves to the detriment of the NJ homeowner/ taxpayer. NJ is going to go broke, its just a matter of when, The money is leaving the state and the low wage people that will be left are not going to earn enough to be able to afford to buy the homes & pay the taxes to support the pensions promised to the locust generation that preceded them, so unless a true miracle happens, the economy turns around and private industry starts to create high paying jobs again NJ is in for a rough ride for some time to come.

  31. gary says:

    I worked for a municipality for four years. And for four years, we read the newspaper, took an hour lunch daily, did a seven hour workday and rode around in city vehicles looking important. I felt like a f*cking monkey for four years.

  32. 3B says:

    #30 funnelcloud: I agree but it is not the just the politicians and unions. The local residents are to blame in many instances as well, with massive spending referendums approved over the last 7 to 10 years. These approvals were given because the voters with the cheerleading of elected officials, especially BOE members believed that the more money they spent on schools, the more their houses would be worth.

    Anyone that urged caution during the debates on this spending frenzy were ridiculed or told to move if they did not like it.

  33. grim says:

    Anyone else notice that the root of the word union is uni, from the Latin unicornus?

    I do not think this is coincidence.

  34. gary says:

    grim,

    In this case, the root uni as associated with unions translates into unibrow.

  35. Happy Renter says:

    “Anyone else notice that the root of the word union is uni, from the Latin unicornus?”

    Yes – lately every time I read something (especially a post here) that mentions “unions,” I have to read the word twice to make sure it isn’t some reference to The Little Community That Could! (TM)

    And speaking of unicorns, take a ganders at this prescient classic, specifically around the 1:10 mark

    http://sendables.jibjab.com/originals/time_for_some_campaignin

    Ah, classic.

    And if someone could please obtain a photo of Jets12 (where is he these days?) then he can take his rightful place among one of the noble steeds of Brigadoon-on-Hackensack (prices up 26% YOY!):

    http://sendables.jibjab.com/sendables/202243/ride_obamas_unicorn

  36. grim says:

    I hear weehawken will be transformed into Monaco in the next few years

  37. Painhrtz - I ain't dead yet says:

    Gary I did it every summer cutting parks and municipal buildings since Grandpa worked for the town. ahh local connections. Rainy days were spent by the regulars playing cards, while us summer folks brought in video game sytems or played wiffle ball in the huge garages to pass the time. On other days work was done by noon the rest of the day was spent hiding from the “man”. Worst part, the regulars hated us because we worked to hard. It took me years to break the bad habits from that job.

  38. gary says:

    Pain [38],

    It was like a routine for the long timers; clock in, go across the street for donuts, coffee and the paper, smoke a butt outside and shoot the breeze for an hour, read two newspapers, go to lunch. In the afternoon, measure a fire hydrant on a street corner, read a magazine, clock out, go home.

  39. Juice Box says:

    Seems the Oakland CA PD whipped out the rubber bullets, tear gas and stun grenades last night and are now lying about it. Things can only go downhill from here there are pictures all over the net of the injuries.

    NY Times downplays the violence too. Check the comments section.

    http://thelede.blogs.nytimes.com/2011/10/26/police-said-to-fire-tear-gas-at-protesters-in-oakland-calif/

  40. gary says:

    Throughout Tuesday a number of clashes erupted between police as a group of approximately 500 protesters began a march at the main branch of the Oakland Public Library heading to Frank Ogawa Plaza to retake the space.

    During some of the evening’s skirmishes protesters reportedly threw paint on police officers, who responded to a number of these smaller clashes with tear gas. The AP reported that at least five protesters were arrested and several others injured in the evening clashes.

    Oakland Interim Police Chief Howard Jordan said that a total of 102 arrests had been made so far, but that number is increasing.

    Mogadishu? Nope, just Oblammy’s vision for a new America. How much you wanna bet the fraud gets re-elected in a squeaker?

  41. funnelcloud says:

    3B #33 Yes we are all to blame, people in some towns are still voting for budgets beyond the caps. But ultimately I still blame the politicians

  42. A.West says:

    JJ, 28
    Agreed on several points. Wife works because she’s ambitious, needs a purpose and she has talents people need. She’d go crazy if all she had to do was clean house, cook, and drive our kid around. But the kinds of jobs she has, she makes enough money where I cannot “not count it”.

    Nevertheless, we base our spending and lifestyle choices on my base income alone, which would only keep us roughly in the top 5% nationally, and in high-cost, high tax NJ, who knows, nothing special. It’s not what you make, it’s what you keep that counts.

  43. 30 year realtor says:

    State of NJ ended the unofficial moratorium on foreclosures in August. Lots of confusion currently about what must be done to get these pending foreclosures to auction. Several appellate division decisions already about issues related to proper service, but no clear path to auction. Looks as though it will take a while until things really get rolling.

    Very few new cases were filed between 12/10 and 8/11. New cases will take more than a year until they hit the sheriff’s sale. Have to figure it will be another year until the sheriff’s sales really pick up steam.

    No way the market is getting any better until this pig clears the snake!

  44. Juice Box says:

    re: # 37 Grim track includes going up and down the cliffs. Deflino way is pretty steep.

    http://transportationnation.org/wp-content/uploads/2011/10/Formula-11.jpg

  45. A.West says:

    Another sign that China is going to get f*ck*d in the A**.

    The latest anecdote I picked up in China: husbands and wives are divorcing just so they can qualify under new regulations to buy an extra apartment for investment purposes. Rental yields on these apartments are about 2%, but most don’t bother to finish the interior. They just buy them to flip.

  46. 3B says:

    #42 But ultimately I still blame the politicians.

    And the politicians are elected by the people.

  47. Juice Box says:

    re: #41 – Gary takes a real tough guy to tear gas an 8 year old. Also shooting Marine veterans with rubber bullets is never really a crowd pleaser. If the cops keep it up there are going to be allot more protesters and the real bullets are going to get fired.

  48. JJ says:

    Debt traders pushed the bonds of MF Global Holdings Ltd. into distressed territory for the first time as the futures brokerage headed by former Goldman Sachs Group Inc. leader Jon Corzine struggles to transform itself into an investment bank.

    The $325 million of 6.25 percent bonds, due in August 2016, fell 24.8 cents yesterday to 63.8 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The tumble brought the yield on the bonds to 17.83 percent, or 16.8 percentage points more than comparable-maturity Treasuries, according to Trace the bond- price reporting system of the Financial Regulatory Authority.

  49. funnelcloud says:

    Juice box #48
    Violence is inevitable, The police are not protectors of the public welfare, they are protectors of those that pay their salaries and pensions.

  50. 3B says:

    #40 rubber bullets, tear gas and stun grenades

    Sounds like Belfast back in the day. Just need some water cannons and it is complete

  51. JCer says:

    China economically is such a mess! They are a large part of the structural instability in the global economy and they depend on some of the rockiest economies in world(US and Europe) for their economy to function. They will fall and hard, I hope war doesn’t ensue as a result, either civil war in China or especially with the west.

  52. Juice Box says:

    JJ – re: MF Global – Apparently going long Euro Soverigns is the TBTF trade of the year. One can only hope Corzine went all in with his own money when it all blows up.

  53. Juice Box says:

    re: #50 – Violence started by the police, in this day and age will be recorded and instantly broadcast. Have they learned nothing from the Arab Spring?

  54. Shore Guy says:

    “The fall in mtg rates is eaten up by the rise in property taxes.”

    Ahh, as the Beatles sang: Be thankful I don’t take it all.

    http://www.youtube.com/watch?v=Maz9ddxEQnM

    Actually, they were prescient. Maybe Paul and Ringo can run for office in NJ.

  55. funnelcloud says:

    Just like our representatives, just like the wallstreet bankers, just like the business leaders, Company CEO’s, The police do not care. “They do not care”, They don’t even try to hide their actions or give a perception of concern. These days its in your face, We’re just going to F*^* you and if you don’t like it. Well to bad, so lets see what happens. Alot of these protesters have nothing to lose, an when a large enough group of people have nothing left to lose the Sh*% is really going to hit the fan. Look at greece.

  56. funnelcloud says:

    Found this quote on CNN thought it was amusing.

    Trickle down economics… The idea that the more money the rich have the more jobs they create for the peon’s below them….. Feel that trickle yet? It’s the 1% p1ssing on your head.

  57. 30 year realtor says:

    #58 – Trickle down economics explained: When the cows eat, eventually there is something for the birds to eat as well.

  58. chicagofinance says:

    The End Is Nigh (Peni$ Pump Edition):

    Ex-judge Donald Thompson, busted for using peni$ pump during trials, has pension cut off

    BY Philip Caulfield
    DAILY NEWS STAFF WRITER

    Ex-Oklahoma judge Donald D. Thompson had filed two appeals to have his pension reinstated after it was cut off following a conviction for indecent exposure and other felonies.

    A former Oklahoma judge who served prison time for using a peni$ pump while he presided over trials will have his hefty pension yanked for good, a court decided on Tuesday.

    Ex-judge Donald D. Thompson had filed two appeals to have his retirement payments reinstated after they were cut off following a 2006 conviction for indecent exposure and other felony charges, The Oklahoman reported.

    Thompson was caught using the sex enhancement device under his robe while he served on the bench as a Cook County judge in 2004 and served 20 months in jail following his conviction.

    The Oklahoma Supreme Court unanimously upheld Tuesday a lower court’s decision that Thompson should lose his monthly $7,789 pension check because his pervy behavior violated his judicial oath.

    “Court reporters observed the felonious exposure of Mr. Thompson’s private parts, and testified to the fact during the criminal trial,” Judge James Winchester said in the ruling, according to The Oklahoman.

    “That trial resulted in conviction of felonies. Those felonies violated Mr. Thompson’s oath of office,” the judge said.

    Thompson was a district judge in Creek County from 1982 to August 2004.

    He will still receive retirement benefits from his stint as a state legislator from 1974 to 1980, the newspaper said.

  59. grim says:

    Idiot pump monkey filled my car with 87 this morning.

  60. Juice Box says:

    re # 60- Chi in NJ he would not even be convicted.

  61. 3B says:

    OK Class this afternoon’s assignment is to guess what the property taxes are on the below listed house, in the land of Unicorns. He or she who guesses closest to the correct answer will have no homework this weekend. No cheating.

    http://www.njmls.com/listings/index.cfm?action=dsp.info&mlsnum=1139947&dayssince=&countysearch=false

  62. Juice Box says:

    3B – based upon the expansive use of skylights and glass like the front doors (all so you can see the unicorns better) I would say 18k.

  63. JJ says:

    I have seen trickle down economics work very well. Nerd works hard, Nerd studies hard, Nerd lands BSD job at GS works 100 hours a week till 40 to make seven figures, Nerd marries strippers who takes him to cleaners. See tickle down in effect.

    funnelcloud says:
    October 26, 2011 at 12:44 pm
    Found this quote on CNN thought it was amusing.

    Trickle down economics… The idea that the more money the rich have the more jobs they create for the peon’s below them….. Feel that trickle yet? It’s the 1% p1ssing on your head.

  64. A.West says:

    3B – I think this is an interesting note at the end of the listing text:
    “SELLER SHALL GIVE NEW BUYER A $5,000 CREDIT TOWARDS REAL ESTATE TAXES.”

  65. A.West says:

    3b, Taxes per year equal about a $1.75 per square foot of the lot, and about $5.75 per square foot for the house. The town is charging about $500/yr for the driveway space, and collecting about $250/yr per closet. Do you also need to call a town inspector when you change your doorknobs? After all, they’re the real landlords.

    The town needs to change the name of its employees to “public masters” from “public servants”.

  66. 3B says:

    #64 Juice: OK we have your answer, and thank you fro completing the assignment rapidly. You do have until 2:15 to revise your answer if you choose to.

  67. 3B says:

    #67 Unicorns are high maintenance animals.

  68. 3B says:

    #66 A West: Good job on finding that clue. You have until 2:15 for your final answer.

  69. Shore Guy says:

    Whatever the cost of taxes on that place, it is worth the price just to have unicorn access. I was going to say 18,000 but, since that number is taken, I will go with $20,000.

  70. Shore Guy says:

    C’mon it is 2:16

  71. Shore Guy says:

    Look at the photo gallery, is that a unicorn in the corner?

  72. 3B says:

    OK boys nad girls time is up. We have a winner, and our winner is Mr. Shore, who came closest to the correct answer with a guess of $20,000.00 per year.

    The correct answer is $22, 103.60!!!!

    Mr. Shore no homework for you this weekend!!!

  73. NjescaPee says:

    You folks in Jersey sure must be rich. ;)

  74. Shore Guy says:

    Egads. I guess it is fafe to assume that the place will cost $2,000 a month in taxes next year.

  75. JCer says:

    775k assessment was a big indicator, I would have guessed 21k as I think River Edge has a smidgen below 3% property tax rate, INSANE! That tends to be a big problem with homes in NJ. Either insanely priced or with property taxes that make no sense.

  76. Shore Guy says:

    If those folks get the place for 625,000 and put down 20% on a 30-year loan at 4% P&I will be 2,387/month. NEXT YEAR their taxes could be more than the monthly P & I. This is just absurd.

  77. Shore Guy says:

    If they paid $650,000 for it, and the other parameters stay the same, the monthly P & I is $2,483, essentially the same as they can reasonably expect to pay in taxes next year.

  78. Shore Guy says:

    “You folks in Jersey sure must be rich. ;)”

    You only wish you paid property taxes like this. Don’t try to hide it.

  79. Shore Guy says:

    To be a property owner in NJ is like being a frog in a slowly-heating pan of water.

  80. 3B says:

    #76/77/78: Taxes have been rising at 7 to 8% a year for the last few years, so 2k a month is a done deal for next year. However the town is going ahead with a reassessment, and hopes to be completed by year end. The town went from one of the lowest taxed towns in Bergen Co, to one of the highest in less than 10 years.

    There is something wrong when taxes in the land of Unicorns are higher then Franklin Lakes, Saddle River and other places.

  81. nj escapee says:

    Gonna really get crazy if the Feds decide to eliminate interest and re tax deductions. only rich folks will be able to stay in their homes.

  82. 3B says:

    #77 Either insanely priced or with property taxes that make no sense.

    And in many cases both!!

  83. grim says:

    Nothing worse than a contemporonial, even if it comes with a magic horse.

  84. 3B says:

    #83 I don;t hin they will elimiante it, and the NAR and all teh rest will fight it tooth and nail, but I could see them limiting it.

  85. 3B says:

    #85 grim: contemporonial

    I like that word!!!

  86. JJ says:

    I don’t get any deduction from owning a home. Neither do the majority of retired people. One should never make an investment for tax purposes.

    Only 64% of returns are itemized. So right off bat 36% of people are ineligible to deduct mortgage interest or RE taxes.

    Factors Affecting the Distribution
    There are four key factors causing the home mortgage interest deduction to be more valuable for high-income earners than low-income earners.

    First, to claim the mortgage interest deduction, taxpayers must itemize when filing federal tax returns, rather than taking the standard deduction. Because of the progressive nature of the federal income tax, the value of itemized deductions rises as income rises. Those facing the highest marginal tax rates—high-income taxpayers—receive a much more powerful tax benefit from tax deductions than low-income taxpayers receive. As a result, low-income taxpayers are less likely to itemize, placing the benefits of the home mortgage interest deduction out of reach. This factor is enhanced by the gradual elimination of the phase-out on itemized deductions—known as the “Pease provision”—that currently limits the amount of itemized deductions high-income individuals can claim.

    Second, low-income taxpayers tend not to own homes, especially those who are younger and live in urban areas. Additionally, many low-income retirees tend to have less interest outstanding on home loans—i.e., their home mortgages are “paid off”—and rely primarily on Social Security income which is not included in AGI. This reduces the tax benefit of the home mortgage interest deduction to them.

    Third, high-income earners tend to have more valuable homes. In general the greater the home value, the greater the interest payment on the associated mortgage. As a result, the President’s Advisory Panel on Federal Tax Reform has criticized the home mortgage interest deduction for primarily encouraging the construction of larger homes, and not necessarily broadening home ownership among middle-income Americans.2

    Finally, speculators in real estate markets—those looking to hold a specific piece of real estate for a small period of time—tend to both earn high incomes and prefer interest-only mortgages. Both of these characteristics lead them to claim a disproportionate share of the tax benefits of the home mortgage interest deduction.

    Despite the claims of various industry groups that the home mortgage interest deduction is an important factor promoting broad-based home ownership, IRS data show the bulk of mortgage interest deductions are claimed by a relatively small fraction of Americans with incomes well above average. As a result, it is likely that the deduction primarily encourages larger and more expensive homes among a relatively small share of taxpayers, rather than promoting broad-based home ownership among ordinary Americans.

    Botttom line the rich, top 1% will suffer the most if the mortgage deduction is eliminated it would be a windfall for the other 99%

    http://www.irs.gov/taxstats/article/0,,id=102886,00.html

    nj escapee says:
    October 26, 2011 at 2:41 pm
    Gonna really get crazy if the Feds decide to eliminate interest and re tax deductions. only rich folks will be able to stay in their homes.

  87. JCer says:

    nj escapee if the feds eliminate those deductions there will be out and out mutiny. The masses will be in washington with pitchforks. I think the pols know better.

  88. 3B says:

    #88/89 There was I believe a WSJ survey a few months ago where people polled on a national basis were against eliminating the mtg deduction, even apparently with the understanding that they do not benefit form it. What can you say??

    Than on the other hand , It is just like when people say they write off their mtg and property taxes on their taxes so it is worth it. I honestly think that some of these people believe they are writing off the entire amount.

  89. Juice Box says:

    JJ – mortgage interest deduction only “cost” the GOV a $100 Billion a year and would perhaps go down allot since people would pay off the mortgage early.

    It’s a Red Herring compared to other breaks and taxes for the Wealth.

  90. Juice Box says:

    other tax breaks Wealthy.

  91. grim says:

    Eliminate MID? Never happen.

    Want to know what will happen? In order of probability:

    MID cap will be reduced from $1,000,000 to somewhere around $500,000. This will impact the “wealthy” only, so it will be widely accepted.

    MID will be eliminated for second and vacation homes. Likewise, there will be some noise here, but since “wealthy” own more vacation homes, this will be acceptable.

    MID will move to a credit, versus deduction, so a greater portion of lower income earners can benefit. This will be a teaser to build public support. Net net no impact to homeowners.

  92. The Original NJ Expat says:

    Gonna really get crazy if the Feds decide to eliminate interest and re tax deductions. only rich folks will be able to stay in their homes.

    And when their neighbors are no longer rich, they will be less so for staying. After 60 years or so of suburban expansion, the better-heeled will make their way back towards the cities and eject the poor to the abandoned suburbs. JJ, How many Indians can you fit in an abandoned McMansion neighborhood?

  93. Juice Box says:

    Another baloney pump on Europe again?

  94. grim says:

    And when their neighbors are no longer rich, they will be less so for staying. After 60 years or so of suburban expansion, the better-heeled will make their way back towards the cities and eject the poor to the abandoned suburbs.

    Who can afford to buy in Hoboken or JC without the MID? You know what a 3br in the “city” goes for these days?

  95. A.West says:

    At $22k starting, that’s over $250,000 of tax payments if you stay K-12. Assuming taxes increase 2% annually, and a discount rate of 5%, the stream of payments into perpetuity have a present value of $733k, more than the value of the house. No doubt the town has already borrowed heavily against these expected future tax receipts.

    Tea Party time.

  96. JJ says:

    Why is it ok for me to subsidize through the mortgage tax break a one million dollar home in Southampton but a car loan on a Chevy Aveo for a 20K worker to get to work is not allowed?

  97. grim says:

    97 – Are you talking about Greece or Edgewater?

  98. 3B says:

    #94 There was something in the NYT’s the other day discussing this now. Apparently the poverty level is switching form the city areas, to the suburbs, and the suburbs are ill equipped to deal with it.

  99. Juice Box says:

    grim release #101 please…..

  100. 3B says:

    #98 Or Student Loans.

  101. Juice Box says:

    re: #100 – switching or spreading? 40 million on food stamps and they don’t all live in the inner cities.

  102. JJ says:

    Interesting I was reading in AZ for instance the average mortgage deduction is 14k. However, it is based on your tax rate the deduction and also you have to back out what you would have got via a standard deduction. If you do that the average person gets back 3k on their return for paying 14k. However, the realtors leave out the details.

    If they said you are spending 14k a year to get back 3k not a selling point.

  103. House Whine says:

    104- people are also crowding all generations into their suburban home. maybe the yound adults can’t find a job or maybe the father/mother of the young adult lost his/hers. So now you have too many cars for the driveways and the garages are stuffed to the gills with boxes of stuff from the 10 people sharing one house. And there’s nothing you can do about it because they are all relatives and have a right to occupy said house. the family can now afford to stay in their home because, like in the old days I guess, the costs are shared by 3 or 4 generations. But now the neighborhood looks different and not really in a good way.

  104. JCer says:

    grim 2bd 1200sqft in luxury building with a view of anything other than a brick wall is still 750k in Jersey City. A three bedroom of 1500 or 1600 sqft would set you back at least a million, lets not even get into so called abated taxes and maintenence.

  105. Juice Box says:

    The Great Secret of the Suburbs

    I was was talking to a friend the other day who said his kid had lost their food card. I stared at him and said your food card? He shrugged and said yeah. Our food card. We’ve had it for a couple years now. And then it hit me. Food stamps. This friend lives in a comfortable five hundred thousand dollar suburban home but his kids are on food stamps and he is on medicaid. He had been a realtor and basically lost his job. But then it go me to thinking, how many other people in the land of wide lawns are on food stamps?

    It turns out a lot. Forty six million people or fourteen percent of the population is now on food stamps. That is an amazing amount of people depending on the government so they wont go hungry. And here is the kicker, half of them are in the suburbs. The suburbs are no longer the place where people go to raise their kids. For a lot of people it is where they went to go into debt and lose their homes. And what has happened now is we have created a huge subclass of people living under the radar.

    This type of family is probably your neighbor or lives down the street. They drive old cars because they can’t afford the payment of a new one. They are on food stamps because they need every nickel to pay utilities and keep their kids in clothes. They are on medicaid because there is no health care when you are broke in America. They might or might not be in foreclosure or in a loan modification. They are living in a twilight land of the American nightmare.

    It now takes years to get someone out of their home. If they know how to file in court they can stretch it out indefinitely. This is exactly what is happening. There are now squatters in their own homes. The American Dream depends on a vision if not a mirage and this must remain intact for the kids and the neighbors. And outwardly everything seems normal. The lawn may not get cut and the cars may be old but it is all stitched together with rubber bands and paperclips. One catastrophe can bring the whole thing down.

    Yet there are millions of families living this way. We have a huge underbelly of people who have fallen out of the middle class but like a ship that refuses to sink, they can keep pumping out just enough water to keep the mirage in place. But eventually they will take water. Once the banks catch up with them or someone slashes entitlements then it is game over.

    Until then, the dirty little secret of the suburbs remains just that.

    http://open.salon.com/blog/william_elliott/2011/10/20/the_great_secret_of_the_suburbs

  106. Juice Box says:

    Let me see who’s oil investments has France been bombing in Libya for the last 7 months?

    Sarkozy Said to Plan Plea to China for EU Fund

    French President Nicolas Sarkozy plans to call Chinese leader Hu Jintao tomorrow to discuss China contributing to a fund European leaders may set up to bolster its debt-crisis fight, said a person familiar with the matter.

    The investment vehicle was one of the options being considered by European leaders at a summit tonight to expand the reach of its 440 billion-euro ($612 billion) European Financial Stability Facility.

    Sarkozy’s plea to his Chinese counterpart would come the day before a planned visit to Beijing by Klaus Regling, chief executive officer of the EFSF, to court investors.

  107. make money says:

    JJ, (98),

    That 20K worker driving to work in a Chevy Aveo does not pay federal income taxes. If anything he gets a unearned income refundable credit. 20K earning Joe Sick pack has probably never paid a federal income tax so a deduction for him makes no sense.

    That deduction will be claimed and a new 7 series by the same millionaire who is already claiming the mortgage tax deductions.

  108. hughes (104)-

    Feh. Many of us here called the suburban slum trend four years ago.

  109. My next call is the rise in Toll Bros/Georgian columns/brick elevation/wing wall meth labs.

  110. Happy Renter says:

    “We have a huge underbelly of people who have fallen out of the middle class but like a ship that refuses to sink, they can keep pumping out just enough water to keep the mirage in place. But eventually they will take water. Once the banks catch up with them or someone slashes entitlements then it is game over.”

    Please refer all questions to Gary.

  111. Neanderthal Economist says:

    “Idiot pump monkey filled my car with 87 this morning”
    A bottle of 102 octane boost should fix that quick. Do they still sell it?

  112. Neanderthal Economist says:

    Jj, of all the nuggets you bestowe on us daily, this was one of the most insightful I can remember, and the most pg rated too…
    “High-income earners tend to have more valuable homes. In general the greater the home value, the greater the interest payment on the associated mortgage. As a result, the President’s Advisory Panel on Federal Tax Reform has criticized the home mortgage interest deduction for primarily encouraging the construction of larger homes, and not necessarily broadening home ownership among middle-income Americans.2

  113. scribe says:

    good night, nj

  114. Good night, my ass.

    But g’night, scribe.

  115. Three attempted bank robberies in my town in less than a week.

    No trend there.

  116. Fabius Maximus says:

    #41 Gary.

    Nice to see people here finally realising that O’s second term is almost a certainty at this point. Its simple to win an election when there is no effective opposition.

  117. Fabius Maximus says:

    #118 Clot,

    They had to drive that far to find a bank with cash in it?

  118. Shore Guy says:

    Clot,

    What currency do they use out there? Are dollars readily accepted?

  119. Shore Guy says:

    brooklyn Hawk,

    Wht the heck is Turner Gill doing to your football team?

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  121. Young Buck says:

    115. Veto-

    He obviously copied & pasted that.

  122. The Original NJ Expat says:

    grim (from yesterday) – Who can afford to buy in Hoboken or JC without the MID? You know what a 3br in the “city” goes for these days?

    At some combination of suburban tax rates, decaying suburban home values and services, and escalating energy costs there will be a point where many can’t afford not to size down and move closer to where the jobs are. For many families right now, just switching from two cars to zero cars would put them back into the black on a monthly basis.

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