Existing Home Sales disappoint again in March

From MarketWatch:

Sales of existing homes slowest since July 2012

The sales pace of existing homes ticked down in March to the slowest rate since July 2012, showing weakness in the early spring sales season, though underlying trends signal a firming in market fundamentals, economists said Tuesday.

The National Association of Realtors reported that the annual sales pace of existing homes declined 0.2% last month to a seasonally adjusted annual 4.59 million. But March’s result beat a consensus among economists polled by MarketWatch, who had expected a sales rate of 4.55 million, compared with a pace of 4.6 million in February.

For context, there was an average monthly sales pace of more than 6 million existing homes over the five years leading up to a 2005 bubble peak.

Sales rates have trended down since the summer on falling affordability as inventory remained low, and there’s been concern about tepid spring-sales results. Some buyers have been put off by rapidly rising prices. According to NAR, the median sales price of used homes hit $198,500 in March, up 7.9% from the year-earlier period. Elsewhere Tuesday, a federal housing regulator reported that home prices in February were up almost 7% from the year-earlier period.

Unusually rough weather in recent months likely also curbed some demand, though regional sales results for March show gains in the Northeast and Midwest, according to NAR. New mortgage rules for borrowers and lenders are likely also curbing some deals, analysts say.

“At least part of the net weakening likely reflects weather effects, although, even without weather effects, sales have clearly slowed since early last year,” Jim O’Sullivan, chief U.S. economist at High Frequency Economics, wrote in a research note.

In addition, banks have high hurdles for borrowers to obtain a mortgage, conditions that are particularly tough for would-be first-time buyers and younger families. Some economists worry that as institutional investors scale back their purchases, with foreclosures and ultra-cheap deals thinning out, first-time buyers won’t fill the gap .

Over the last several business days, economists at both Fannie Mae and Freddie Mac, the federally controlled mortgage-finance giants, cut their forecasts for the housing market’s performance in 2014. Fannie reduced its outlook for new-home construction, while Freddie lowered its view for home sales.

Despite home-sales weakness in the first quarter of this year, economists don’t think 2014 will be a wipeout.

“Although the string of negative readings suggests the recovery has stalled, the underlying details are more supportive,” Wells Fargo Securities economists wrote in a research note.

“Negative housing momentum, which was exacerbated by severe weather conditions during the winter months, may be starting to fade…We expect positive underlying fundamentals to begin reasserting themselves, helping to drive a rebound in housing market activity over the coming months,” Gennadiy Goldberg, U.S. strategist at TD Securities, wrote in a research note.

First-time buyers’ share of existing-home sales rose to 30% last month, up from 28% in February. The long-term average is closer to 40%.

Distressed properties’ share of existing-home sales fell to 14% in March from 16% in February.

This entry was posted in Economics, Housing Recovery, National Real Estate. Bookmark the permalink.

139 Responses to Existing Home Sales disappoint again in March

  1. Mike says:

    Good Morning New Jersey

  2. What so good about this morning?

  3. grim says:

    It’s not 4 degrees and snowing…

  4. charlie says:

    Can you normalize sales/inventory?

  5. grim says:

    I don’t like looking at seasonally adjusted or annualized numbers, and I especially don’t like both together. I prefer straight, unadjusted, year over year figures wherever available (with an understanding that there may be variations due to holidays, and that month to month comparisons are more misleading than not, etc). Maybe it’s because I’m a simple country boy, but I don’t like econmetricists fudging numbers.

    Way too much noise involved when you try to seasonally adjust and then annualize the number, in my opinion it becomes a forecast and not an analysis of data. I understand there is a strong desire to produce a number that is easily digestible without having a strong understanding of context, but sometimes markets just don’t work that way.

  6. funnelcloud says:

    Yesterday we were heading into another bubble, Real estate values were skyrocking and everything is wonderful in wonderland again, news changes from day to day,
    think they could get the story right, today pit of dispare, tommorow Rocky Mountain High. So Which is it all you people out there in TV land.

  7. Essex says:

    Affirmative action dies. Film at eleven.

  8. anon (the good one) says:

    Joyce:

    @guardiannews: #myNYPD Twitter call-out backfires for New York police department http://t.co/rBkFZI2M1W

  9. yome says:

    Low inventory = low sales ; goes hand in hand.
    Low inventory more buyers ; prices will come down

    Is it good news for will be buyers?

  10. yome says:

    Low inventory = low sales ; goes hand in hand.
    Low inventory more buyers ; prices will go up
    Low inventory less buyers ; prices will come down

    Is it good news for will be buyers?

  11. Fast Eddie says:

    There never was a recovery. The housing market was placed on a respirator in dire hope that the body would recover. There is still an ocean of zombie house settlers barely making the payment every month for an asset that will take a decade or longer to reach the break-even point. I’m talking about our area; I could care less about the rest of the country.

    How do you list a house when you over-paid and are drowning? And what about all the HELOCs maxed out due to the wasted jet ski, mindless cruises and other nonsense? The prices never corrected. It continues to be a very long slog even more so now that the vultures are departing. In the infamous words of BC Bob: “Sell? Sell to whom?”

  12. yome says:

    HARP 2.0. I got mine at 3.0% zero closing.They even paid for Fedex

    Strategic default

    “How do you list a house when you over-paid and are drowning? And what about all the HELOCs “

  13. yome says:

    12
    Sorry you don’t list the house. You stay put

  14. Fast Eddie says:

    Sorry you don’t list the house. You stay put

    True, if you’re making the payments but you’re a prisoner. You’re not paying any principal, you’re working to survive. It’s shelter but it’s not an investment. You’re making payments on the asset that has experienced vast depreciation. And we’re not talking a few thousand like in a car, we’re talking six digits of being in a crater-sized hole. That’s being bilked, big time. The term “f.ucked bagholder” couldn’t be any more accurate.

  15. Fast Eddie says:

    Strategic default

    Let them all default and bring the inventory to market.

  16. Comrade Nom Deplume, Guardian of the Realm says:

    [8] anon,

    I am outraged. Clearly an example of breed profiling.

    https://twitter.com/BananaKarenina/status/458759194426884096/photo/1

    I’ll bet they just decided to harass this biker because of his obvious connection to Boston.

  17. Comrade Nom Deplume, Guardian of the Realm says:

    [11] eddie,

    So I gather you subscribe to my belief that the recent “recovery” of housing prices is simply a multiyear dead cat bounce?

  18. joyce says:

    The IRS was in damage control mode Tuesday after an audit revealed that it paid bonuses to employees who were in trouble over tax issues themselves.
    http://money.cnn.com/2014/04/22/pf/taxes/irs-bonuses/index.html?iid=HP_LN

    More than $2.8 million, plus thousands of hours of paid time-off, were doled out over two years to employees who had recently been disciplined for various types of misconduct, according to an audit report. About $1 million of that money was given as bonuses to 1,100 employees who were in trouble over tax related issues.

    The tax problems include willful understatement of tax liabilities, late payments and under-reporting of income, according to the report issued by the Treasury Inspector General for Tax Administration.

    The report says that providing awards to employees who fail to pay taxes “appears to create a conflict with the IRS’s charge of ensuring the integrity of the system of tax administration.”

    Although federal regulations do not require the IRS to consider tax compliance of employees when issuing bonuses, the agency says it will change the policy, as per the audit’s suggestion.

    “We strive to protect the integrity of the tax system, and we recognize the need for proper personnel policies,” the agency said in a statement.

    Over the past four years, the IRS says it has not issued awards to any executives who were subject to disciplinary action. It is now considering extending that policy to all employees.

    The audit report found that the IRS did reduce overall spending on bonuses, fully complying with new federal guidance issued in fiscal year 2011.

  19. grim says:

    True, if you’re making the payments but you’re a prisoner. You’re not paying any principal, you’re working to survive. It’s shelter but it’s not an investment. You’re making payments on the asset that has experienced vast depreciation.

    My problem with your statement is that you imply there is some sort of reasonable alternative. A decent rental, for a family of 4, in Wyckoff runs about $3,500-4,000 a month. In lower tier towns you are talking about $3,000-$3,500.

    A $4,000 a month rent payment is equivalent to a PITI with the following parameters: $600,000 loan amount, $13,000 taxes, $1,000 homeowners insurance.

    While that doesn’t take into account the lost value of the down payment being invested elsewhere, it also doesn’t take into account the mortgage interest and property tax write offs.

    Chances are the purchased house will be nicer than the rental house where rent=piti, and I’d argue that you could probably get an equivalent house at a monthly outlay of about $500 less.

  20. grim says:

    If you thought the purchase market was ugly, you haven’t spent any time at all looking at the equivalent rental market.

    In many cases, in similar towns, with similar parameters (neighborhood, beds, and baths), your rental inventory will be 1 or 2 properties – THAT’s IT.

    It’s easy to find a smaller rental, but if you have 2-3 kids, or 2 kids (boy/girl) – you are screwed if you want a decent house in a good district.

  21. Comrade Nom Deplume, Guardian of the Realm says:

    Interesting observation, and one that I have sort of shared for some time. Unlike the “contributor”, I didn’t pin all of the decline on the end of Bretton Woods, (sort of a chicken and egg problem here–after all, why did we go off the gold standard in the first place?) but I do see the charting and analysis as consistent with my view that things started going south in the early 70’s (possibly even the late 60’s) and we have been on a long, empire-crumbling, glide path ever since.

    http://davidstockmanscontracorner.com/pikettys-1971-inflection-point-was-it-lawrence-welks-last-show-or-sound-moneys-last-stand/

  22. clotluva says:

    [20-21] Grim

    If you thought the purchase market was ugly, you haven’t spent any time at all looking at the equivalent rental market.

    But per Comrad’s post in #19, there is a more cost-effective solution to either buying or renting: multi-family, multi-generational households.

    What’s the stock market play for going long bunkbeds and convertable sofas?

  23. Outofstater says:

    Georgians with concealed carry permits can now carry in church, if the pastor says it’s okay. Still can’t carry on college campuses though.

  24. anon (the good one) says:

    the empire may be crumbling, but all I want is to bring my gun to church

  25. yome says:

    Not true. I converted my 30yrs to 15 yrs HARP 2 , I am killing over $ 1100 a month on principal. On a $1700 mortgage. I agree with Grim on rental comparison. You are better buying than renting in NJ

    “You’re not paying any principal, you’re working to survive. 

  26. Fast Eddie says:

    My problem with your statement is that you imply there is some sort of reasonable alternative.

    There isn’t, I agree. Guys like me got lucky on the timing. For all other’s, they’re f.ucked. Then again, maybe it isn’t luck because anyone who fell for the line of sh1t during the height of the bubble is their fault for allowing themselves to be swindled.

    And I’m fully aware of the pitfalls of renting and the cost factor. And you’re also assuming that the 600K loan including PITI is purchased on a dip and not during the peak. And it’s still not even close to a good time to buy. When 2 or 3 homes are languishing and they have 7 out of 10 on the checklist, then it will be a good time to buy. All it takes is the Billy Ray Valentine methodology to know that we’re there.

    And what is the effect of mortgage interest and property tax write-offs when you’re in debt and on a financial respirator. It’s like p1ssing in the ocean.

  27. Fast Eddie says:

    yome [26],

    Congratulations! Just don’t rub it in the face of the tens of thousands of others who couldn’t refinance.

  28. Fast Eddie says:

    Nom [17],

    The only ones who think it’s not a dead cat bounce are those with a personal agenda or those in complete denial.

  29. yome says:

    Rand Paul recasts himself as a ‘compassionate conservative’

    What happened to the Ayn Rand philosophy? Playing the masses?

  30. anon (the good one) says:

    @paulmcpolin44: Middle class falls on hard times as country’s wealthiest flourish via @NYPost http://t.co/WD9urUFCrZ

    @BillMoyersHQ: .@DLeonhardt & @KevinQ: the US middle class is falling behind those of other rich countries. http://t.co/yiZTamvhh5

  31. Painhrtz - Disobey! says:

    hey worked for Obama but I’m not holding out hope. Team Red Team blue whatever

  32. Fast Eddie says:

    Chances are the purchased house will be nicer than the rental house where rent=piti, and I’d argue that you could probably get an equivalent house at a monthly outlay of about $500 less.

    Of course it’s going to be nicer, it’s your house and you’ll primp it and take care of it accordingly. And a monthly outlay of $500 or less? You’re assuming that people are putting a sizable down payment down on the joint. And let’s hope there’s money left to fix that “issue” with the roof that miraculously went undetected during the house inspection which occurred shortly after the hot water heater blew up.

  33. anon (the good one) says:

    @markfollman: Rand Paul, bless his conservative soul, used to prefer Jimmy Carter to Ronald Reagan. Here’s the video: http://t.co/aDH7qrIJwC

    “In a variety of campaign appearances that were captured on video, Paul repeatedly compared Reagan unfavorably to Carter on one of Paul’s top policy priorities: government spending. When Paul was a surrogate speaker for his father, then-Rep. Ron Paul (R-Texas), during the elder Paul’s 2008 presidential quest, his sales pitch included dumping on Reagan for failing to rein in federal budget deficits.”

    yome says:
    April 23, 2014 at 10:05 am
    Rand Paul recasts himself as a ‘compassionate conservative’

    What happened to the Ayn Rand philosophy? Playing the masses?

  34. Comrade Nom Deplume, Guardian of the Realm says:

    I know that anon will dismiss all out of hand because of the source but I found the statistics themselves to be quite telling.

    http://endoftheamericandream.com/archives/18-stats-that-prove-that-government-dependence-has-reached-epidemic-levels?utm_source=feedly&utm_reader=feedly&utm_medium=rss&utm_campaign=18-stats-that-prove-that-government-dependence-has-reached-epidemic-levels

    I think that the stats speak for themselves so I’ll not opine further. I’ll let those who think themselves smarter (and they may well be smarter) to post their rebuttals.

  35. Comrade Nom Deplume, Guardian of the Realm says:

    [34] anon,

    To a true conservative, there are things Carter got right and Reagan got wrong.

    Deal with it.

  36. Bystander says:

    Here’s a renting stat. I have made 0 trips to Home Depot since 2008.

  37. anon (the good one) says:

    watch it. your honorary membership in the Tea Party could be revoked

    Comrade Nom Deplume, Guardian of the Realm says:
    April 23, 2014 at 10:17 am
    [34] anon,

    To a true conservative, there are things Carter got right and Reagan got wrong.

    Deal with it.

  38. Comrade Nom Deplume, Guardian of the Realm says:

    [34] anon,

    Back in Reagan’s first term, I was an undergrad and considerably more liberal than I am now. I remarked to my academic advisor that Reagan was “the biggest Keynesian since Keynes.” He (a hard core liberal) liked it so much, he used it in one of his scholarly articles.

  39. Comrade Nom Deplume, Guardian of the Realm says:

    [38] anon,

    “watch it. your honorary membership in the Tea Party could be revoked.”

    Shows (again) how little you know. To you, the TEA Partiers are all knuckle-dragging, racist, misogynistic, troglodytes.

    I know a good number of TEA Party folks and I think nearly all would agree with my sentiment about Carter and Reagan. Including the women and minorities (yes, they exist and in Newark no less. I have proof if I can retrieve the photos from my old phone).

  40. Fast Eddie says:

    anon (the good one),

    Your side is winning in a rout. The national agenda has become weed, g.ay s.ex, garnering illegal votes, greater dependence and wealth distribution. There’s nothing else to be done but sit back and “enjoy” the ride. Don’t you agree?

  41. Phoenix says:

    35.
    Good luck getting the old goats off of their “entitlements.”
    Romney had an idea, it was a cutoff age, 50 and older were “grandfathered”, the rest get a voucher.
    Had he set the bar lower, 45-40, he may have won the election.
    Same with the unions, can’t touch the already retired, only the current worker.
    Time to do away with ” grandfathered”.
    Grandfather voted against a tax increase, yet wanted his future bennies to continue.
    Grandfather crying about property tax while collecting pension from same town, or moving away after getting his “cut.”
    Grandfather voting that Social Security should get cut, but he needs a COLA, cut for the kids only.
    Grandfather needs a break on his pancakes at IHOP , kid gets no raise but gramps is comfortable in his Lexus.
    Gramps made tons of money in stock market outsourcing kids job.
    Gramps made tons of money talking college kid into credit cards first day on campus.
    Gramps made tons of money advertising to kids to buy stupid toys instead of saving, then made more profit when toys were made overseas.
    F Gramps.

  42. Libturd in the City says:

    I liked Reagan best when Reagan didn’t know who Reagan was.

  43. Comrade Nom Deplume, Guardian of the Realm says:

    [42] phoenix,

    Gramps sees the end coming. Gramps is gonna keep what he can. And Gramps is gonna waste any self-help redistributionist that sets foot on his property.

  44. Libturd in the City says:

    Move back in with my folks? I’d rather live in a refrigerator box and eat cat food. Now if they were willing to move into my place and pay some rent (just like they charged my brother when he graduated from college and was saving), I might consider it.

  45. Libturd in the City says:

    Nom…the best part of that article you linked was the hyperlinks in the header. It’s essentially the playlist of Fox News advertisers:

    Home
    Gold Coins
    Silver Coins
    Emergency Food
    Contact
    Military Surplus
    Self-Defense
    Preppers
    My New Book
    The Most Important Thing
    Did You Know?

  46. JJ says:

    Moving in with folks depends how cool your parents are. I once dated a girl who was like 31 at the time and she lived at home part of time . Had an apt for a one years and gave it up as it was just a money sucker.

    Problem with renting or even owning when single is you are paying for it 365 nights a year 24 hours a day.

    This girl lived parents lived in Long Beach some times if friends were doing an off seson rental she would jump on board. First year I met her she was living in a 1.5 millin dollar Bay front home in Atlantic Beach that was drop dead to die for. She had 12 girls sharing it and it was an Sept 15 to May 15 rental. I swear when I stayed over my Johnson was extra large. My little coop felt like squat.

    She “moved” home in summer. ‘moved” as summer is only four months long. She wold take a two week vacation during that period, bum a few weekends in Hamptons or Jersey Shore, crash at Girl Friends house in the City and if dating sleep over guys house a 1-2 nights a week.

    She would pay 1/12 the cost of an off peak rent on a mansion 2/3rds of yeasr and pay nothing in the other 1.3. Last I hear she got married at around 35.

    Now is she rented 365 days a year for 14 years what a waste of money.

  47. JJ says:

    SWATing is my new favorite sport.

  48. Phoenix says:

    44.
    Gramps is going to get snuffed by Obamacare.
    Old Bessie is too expensive to keep.
    No 2 year + outcome, no procedure to be done.
    Good business model will be discount aka WalmartFuneralHomes.com, do-it yourself creamation kits, etc.

  49. yome says:

    Here is real numbers
    A middle class family buying a $360,000 home putting down 20% with 15 year $288,000 mortgage at 3%.
    Monthly is $1756 a month. $1100 goes to principal. Real cost is $656.00
    Property tax is $7000 a year that is $584 a month. Cost of owning against renting is $1240 a month against renting is $2400 according to zillow.
    Deduction on tax and mortgage interest is $14,872. If at 25% bracket ,you are getting back $3718 a year.
    Now your real cost of owning is only $930.16 against $2400 renting. No more mortgage after 15 years.
    What is not affordable with that?

  50. Libturd in the City says:

    “SWATing is my new favorite sport.”

    I thought for sure you would be a ‘flaming amazon’ man.

  51. Fast Eddie says:

    yome [51],

    You forgot to factor in when the moon is in the seventh house and Jupiter aligns with Mars. How many more assumptions can you stuff into your scenario?

  52. Comrade Nom Deplume, Guardian of the Realm says:

    [46] libturd,

    Like I said, I disclaimed the source link. It’s the stats I was focusing on.

  53. JJ says:

    When considering inflation, as an investment real estate doesn’t pull much weight. According to the U.S. Census Bureau Survey of Construction, single-family real estate generated a .74 percent annual return over the last 30 years.

    “And this doesn’t even account for many of the miscellaneous costs involved in real estate,” writes Cullen Roche, of Pragmatic Capitalism.

    “A house is basically a depreciating asset that comes with an appreciating piece of land. But that depreciating asset is extremely expensive over its lifetime. When you calculate the total costs that go into maintaining this asset the returns are very likely to be negative over long periods of time. So that 0.74 percent figure is probably higher than you should really expect.”

  54. yome says:

    Then peace will guide the planets And love will steer the stars.

    No assumptions.True to life scenario. I forgot rent goes up and it is not tax deductible.

    “You forgot to factor in when the moon is in the seventh house and Jupiter aligns with Mars. How many more assumptions can you stuff into your scenario?”

  55. Fast Eddie says:

    15 yr. w. 288K mortgage @ 3.0% = $1988

    NJ taxes at $7,000? Where are we, in Vineland? It’s more like $9000 and that’s the low end. Add in $1000 for insurance and we’re at $2800 per month not including a thousand trips to home depot. Let’s cut the bullsh1t, ok?

  56. joyce says:

    I believe the biggest assumption is the 360k house.

  57. JJ says:

    Historically over last 30 years the S&P 500 has returned 10% and housing over last 30 years .74%

    Yes you save on rent owning a home but it is dead money

    51.yome says:
    April 23, 2014 at 11:20 am
    Here is real numbers
    A middle class family buying a $360,000 home putting down 20% with 15 year $288,000 mortgage at 3%.
    Monthly is $1756 a month. $1100 goes to principal. Real cost is $656.00
    Property tax is $7000 a year that is $584 a month. Cost of owning against renting is $1240 a month against renting is $2400 according to zillow.
    Deduction on tax and mortgage interest is $14,872. If at 25% bracket ,you are getting back $3718 a year.
    Now your real cost of owning is only $930.16 against $2400 renting. No more mortgage after 15 years.
    What is not affordable with that?

  58. grim says:

    I believe the biggest assumption is the 360k house.

    Everybody thinks they are upper middle class.

  59. Comrade Nom Deplume, Guardian of the Realm says:

    [8] anon and joyce,

    I had a comment inserted on the supposed police brutality seen in the twitter feed and how the NYPD got punked.

    One of the supposed targets of NYPD brutality was a Boston Terrier being frisked. Turns out that “Chopper” is pretty well known to police. In San Diego.

    https://www.youtube.com/watch?v=dRg6-cdOsBI

  60. joyce says:

    grim,
    I know that wasn’t directed at me, because where I live can hardly be mistaken for a palace. That said, aren’t you the one saying there are zero median priced homes in NNJ?

  61. Fast Eddie says:

    Everybody thinks they are upper middle class.

    Which is why a sea of s.uckers are paying for a depleted asset for eternity.

  62. DuckVader says:

    [14] Fast Eddie,

    But isn’t the thinking that a house is an investment the thing that got all of us into trouble in the first place. Because then people would buy in expectation of the potential gain, rather than evaluating the cost of the monthly payments as the cost of buying shelter (with the added benefit that owning means you don’t get kicked out as long as you make the payments needed vs. renting where you can get kicked out for not making payments or simply because the landlord doesn’t want to renew).

  63. Libturd in the City says:

    Yome.

    Someone who can only afford a double-wide in New Egypt is not qualifying for 15-year mortgage at 3% nor can they afford to make those payments if they did. Chances are that their credit cards are maxed and what little disposable income they have goes to Viceroys and Old Milwaukee.

  64. chicagofinance says:

    JJ: I think BOA is calling all the Merrill Lynch TrUPS…….fuk! fuk! fuk! fuk! damn it :(

  65. yome says:

    I never considered real estate as an investment.It is more of a forced savings and protection to inflation.

    A $1 check you write today is equivalent to $0.47 from 30 years ago

  66. JJ says:

    I own my house 14 years and have around100K in receipts laying around. And no it is not any better really. Roofs, heating systems, fences, kitchens and bathrooms add up.

    It only adds value when you sell immediately. My house had a 1970 kitchen when I bought it in late 1999. Put a whole new kitchen in 2003. That new kitchen when I sell adds no real value as it is already old. My new fence from 2005, my new sidewalk and driveway in 2008 or even my new bathroom from 2013 all will add no value when I sell. They will be old by then.

    And I am not going crazy. A new den was done in 1982, upstairs bathroom in 1991, middle bathroom around 1978, a dormer around 1994, a deck around 1993, an extension pop out in kitchen in 1969 I have all the co’s and permits over years, new windows and siding in the early 1990s

    Heck back in groovy 60s someone did wall to wall green shag carpeting and wood paneling everywhere that was ripped out in 1982 Den remodel.

    Point is around every 5 years for last 55 years some big project was done on house and all the maint.

    Sidewalks, fences, kitchen, bathrooms, dens, oil burners, water heaters, roofs, they all wear out. My back deck from 1992 I have CO, needs patching and painting and sanding it is already near last legs. My vinyl siding from that same era has a few years left. And my gutters are shot. Also my screen door I put up in 2000 guess what already rusty and has a hole in it. And the kitchen extension from 1969 the beams underneath I did a little handiman work with cinder blocks, and pressure treated wood in 2011, guess what in a few years that will need major work. I cant keep propping up a 10×12 extension that way forever.

    Add in fact if I wanted to sell I would need to drop 10K into house to fix stuff. And pay a good realtor around 20K if I wanted top dollar. It is not like a $7.95 broker commission.

  67. Libturd in the City says:

    “Everybody thinks they are upper middle class.”

    Everyday Tuesday and Thursday, my commute takes me past exits 141-145 on the GSP. On those days, I KNOW I am lower upper class. Of course, except when I drive past their schools.

  68. grim says:

    62 – Not at all, just a general snarky remark towards home buyers.

  69. yome says:

    #65 Lib
    Not everyone will be able to do it.
    I am doing it today. I sent 2 kids to Rutgers with no student loans.Tons of savings.

    Just like you.It is the way you analyze the situation

  70. yome says:

    Just a low level middleclass with a $120k annual income

  71. JJ says:

    what about countrywide trups?

    Where are you putting the cash? I am running out of ideas, I was buying a lot of Munis from November till March but the deals are gone. And taxable corporate bonds at 4% lots of risk and tax for 4% makes me nervous.

    I have like another 75K I want to invest in the next few weeks and would like to get some tax free interest or lower tax rate dividends with decent yeild. Any recommendations?

    My put some junk in trunk days are long over given much much lower yields and higher tax rates

    66.chicagofinance says:
    April 23, 2014 at 11:53 am
    JJ: I think BOA is calling all the Merrill Lynch TrUPS…….fuk! fuk! fuk! fuk! damn it :(

  72. JJ says:

    Considering Cube farm folks on Wall Street get 120K bonuses every January you are working an entire year for the amount they make on bonus day . And I am talking cube dwellers

    72.yome says:
    April 23, 2014 at 11:58 am
    Just a low level middleclass with a $120k annual income

  73. yome says:

    Hopefully my next generation son that works for MS will be lucky enough to attain what you said. I am done , can’t complain.

    JJ says:
    April 23, 2014 at 12:02 pm
    Considering Cube farm folks on Wall Street get 120K bonuses every January you are working an entire year for the amount they make on bonus day . And I am talking cube dwellers

    72.yome says:
    April 23, 2014 at 11:58 am
    Just a low level middleclass with a $120k annual income

  74. yome says:

    I forgot to mention.The $288,000 mortgage is for a second home I paid cash with my low middleclass income

  75. Libturd in the City says:

    Yome,

    “It is the way you analyze the situation”

    Seriously…I think it goes a lot further than that, but you are partially right. An understanding of finance helps a hell of a lot too. Savings is something that everyone can do and so few do. Heck, watch an episode or two of that savings dyke (forgot her name) and you are 90% there.

    Our GR house is still lacking window finishings besides white blackout roller shades. There is no artwork on the walls nor centerpieces on any tables. It’s actually a little embarrassing when people come over, but I have so little time these days and the second kid is a colossal time suck. Plus really, it’s a huge waste of money and I’m not one who feels the need to keep up with the Jones’. When I was in India, I was floored by how minimally the middle class lived. Their homes were so simple and so simply furnished. And people socialized way more (and not on Facebook). For now, I’ll continue to save and maintain no debt besides my mortgages and the Mazda car loan. As Jr. approaches college age I’ll see if I can afford to retire to an easier job on some college campus (maybe even Montclair) where my son can attend for free. Unless he’s real smart and goes for a trade. I did tell you about the plumber I hired a few years back that drove a yellow Lamborghini right?

  76. joyce says:

    In all seriousness, we know that 120 isnt much around here… that said, youre almost 100% above the median salary.

    72.yome says:
    April 23, 2014 at 11:58 am
    Just a low level middleclass with a $120k annual income

  77. joyce says:

    The thing we need is more teet suckers and parasites in Lower Manhattan.

    75.yome says:
    April 23, 2014 at 12:04 pm
    Hopefully my next generation son that works for MS will be lucky enough to attain what you said. I am done , can’t complain.

    JJ says:
    April 23, 2014 at 12:02 pm
    Considering Cube farm folks on Wall Street get 120K bonuses every January you are working an entire year for the amount they make on bonus day . And I am talking cube dwellers

  78. JJ says:

    How do you pay cash for a home and have a mortgage?

    Is this the beach house? Looking forward to summer?

    I have not even bother to rent my beach place yet. The short term people wait till last minute to book. The longer term people, folks who want a whole month or even whole summer want to see place first. My tenants are supernice so dont feel like bothering them showing house to people who may not even take the house. I will wait till winter tenants leave

    Still find it amazing that one week rent in summer is same as one months rent in winter. And two weeks rent in the summer is the same as a monthly rate with a realtor.

    76.yome says:
    April 23, 2014 at 12:08 pm
    I forgot to mention.The $288,000 mortgage is for a second home I paid cash with my low middleclass income

  79. JJ says:

    Making 120K before taxes is dumpster diving, can collecting, food stamp licking poverty around these parts.

    79.joyce says:
    April 23, 2014 at 12:36 pm
    In all seriousness, we know that 120 isnt much around here… that said, youre almost 100% above the median salary.

    72.yome says:
    April 23, 2014 at 11:58 am
    Just a low level middleclass with a $120k annual income

  80. anon (the good one) says:

    this is no good news for you, Eddie.
    many of you will have to pay up

    @BloombergNews: BREAKING: P0rnigraphy victims must be compensated by viewers, U.S. high court rules: http://t.co/v2zUX9P0uK

  81. yome says:

    #81 JJ
    I bought my house for $126k in 1984. It was almost paid in 2004 when my wife started bothering me for a new house.I cashed out refi my house and paid cash for a new house down the shore in SJ I took delivery in 2006.
    The bank appraised the 1st house for $360k and gave me $288k. I did a HARP 2.0 got 3% interest 15 years

  82. FKA 2010 Buyer says:

    A close to $30k/year private education gets you this. These guys really listened in their Econ class. I guess movies like the “Wolf of Wall Street” and talking to their pops about “Risky Business” and “Trading Places” really struck a cord with them.

    Already knew there was a market with students at elite schools, but to corner the market is admirable.

    http://www.cnn.com/2014/04/22/us/pennsylvania-students-drug-bust/

  83. Xolepa says:

    (79) Jeez, the tax man sure loves those Cubehead Wall Streeters. Figuring it out, what chunk of that yearly bonus goes into the bogeyman’s pockets? Then figure, if they are still in their thirties, they most likely rent and thus have no deductions. Add the rent they pay to the taxes sucked from their behinds and what do you have left?

    I used to tell JJ to put that extra money into a cash business. I don’t think he understands.

  84. chicagofinance says:

    Pimping……

    JJ says:
    I have like another 75K I want to invest in the next few weeks and would like to get some tax free interest or lower tax rate dividends with decent yeild. Any recommendations?

  85. chicagofinance says:

    Also, become the CEO of a charity…
    http://www.cnbc.com/id/101606466

  86. anon (the good one) says:

    those Cubehead Wall Streeters are idiots. they could had gone into teaching…free money, no work and 3 months vacation, right?

    Xolepa says:
    April 23, 2014 at 12:59 pm
    (79) Jeez, the tax man sure loves those Cubehead Wall Streeters.

  87. JJ says:

    Chifi maybe your rich NJ clients might be interested

    Market Post: $1.2 Billion N.J. Deal Intrigues Market
    by Hillary Flynn and Maria Bonello
    APR 23, 2014 11:06am ET
    The market is focusing on the New Jersey Economic Development Authority’s $1.2 billion of school facilities construction refunding bonds scheduled to come to market Wednesday, with traders expecting the deal will price attractively.

  88. Libturd in the City says:

    “Metropolitan Council on Jewish Poverty”

    This has shyster written all over it.

  89. JJ says:

    These folks max out the 401K, Flex Spend, Transit Check, Child Care, 529 and buy muni bonds and Index ETFs etc. A few do own rental properties.

    But mostly these is all side nonsense. Plenty of folk I know late 40s or early 50s bounce around till they finally land that good job and then ride it. Bottom line a middle level manager job making lets say 335K a year does not sound like much at all. But every three years it is a million dollars. Hang on for 15-21 years and that is 5-7 million. Sure it is taxable. But the big tax rate is for income over 450K in one year and you are not hitting that.

    86.Xolepa says:
    April 23, 2014 at 12:59 pm
    (79) Jeez, the tax man sure loves those Cubehead Wall Streeters. Figuring it out, what chunk of that yearly bonus goes into the bogeyman’s pockets? Then figure, if they are still in their thirties, they most likely rent and thus have no deductions. Add the rent they pay to the taxes sucked from their behinds and what do you have left?

    I used to tell JJ to put that extra money into a cash business. I don’t think he understands.

  90. JJ says:

    It is a Jew on Jew crime. Why are we involved?

    91.Libturd in the City says:
    April 23, 2014 at 1:09 pm
    “Metropolitan Council on Jewish Poverty”

    This has shyster written all over it.

  91. yome says:

    I have worked with Orthodox Jews.They are good people and very smart with money and need to make money. I mean really need to make money. The wife stays at home with a contract stating the husband will provide. She makes 6 or more kids and all the kids have to learn Hebrew. They all go to Hebrew school pay $6,000 to $10,000 per kid. The poor husband makes so much money and they are still poor

  92. chicagofinance says:

    $120K means nothing without context…….it comes down to what is your payment for housing……most of those over 50 or so have small payments (unless they HELOCed or cashout refi’ed)……most of those in the 35-late 40’s area were not able to buy their ultimate house before some manner of bubble-flation warped the price…….if your first purchase was after 2002-ish area, $120K is crap….

    joyce says:

    April 23, 2014 at 12:36 pm

    In all seriousness, we know that 120 isnt much around here… that said, youre almost 100% above the median salary.

    72.yome says:
    April 23, 2014 at 11:58 am
    Just a low level middleclass with a $120k annual income

  93. Xolepa says:

    (92) Yeah. Easy come. Easy go. By the time my daughter finishes college in two years, it’s a total of $680k in college tuition/housing/fees, etc for my kids. Not as bad as it seems, though.

  94. chicagofinance says:

    BTW Stu…..your pick in one of several good ones to take advantage of fracking an the Obamunist stonewalling crap……that said, they just reported and also more Obonewalling just announced, so it is a little bit of a flush time to buy it…..long term good though……..you know about the other one….equipment maker?

  95. Libturd in the City says:

    I pulled a real bonehead move this year when filing my taxes. I put down the wrong amount in estimated taxes paid on my Federal form. I was off by a couple grand in my favor. It’s no wonder it took so long for me to get my tiny refund? If that’s not an audit flag, then I’m not sure what is? So far, never been audited. Not that it would be a big deal.

  96. yome says:

    #95 Chi
    My son got into MS in 2010,when wall street is cutting and did not received a raise until 3 years later. He works long hours but not as long as the commentary. He got promoted to a new position and being the youngest and not a family man, he works those hours while the seniors go home ahead of him. The money is not much but living at home and just saving money and partying,helping us with $500 a month is more than enough for right now. I will not really call $100k, single, living at home not much but with the experience he his getting hopefully he can make like JJ when he settles down.

    For sure, for a new graduate with no experience that is alot of money. Not as much as they used to make

  97. Xolepa says:

    (99) File an amended return. You will be hit with some interest, perhaps penalties. On the other hand, the IRS computers may pick that one up eventually and send you an automated bill. Interest and penalties included, of course.

  98. JJ says:

    120K is nothing with or withotu context.
    I have no mortgage, cheap RE taxes and 120K no longer is enough for food, clothes, heat, cars, the basics after taxes if you have 3 or more kids.

    Housing is the cheapest of my expenses. Actually Pretty much anyone who bought a starter home, never traded up put down a big down payment and grieves his taxes and never cashes out by year 10 the housing cost is a joke. .

    96.chicagofinance says:
    April 23, 2014 at 1:21 pm
    $120K means nothing without context…….it comes down to what is your payment for housing……most of those over 50 or so have small payments (unless they HELOCed or cashout refi’ed)……most of those in the 35-late 40′s area were not able to buy their ultimate house before some manner of bubble-flation warped the price…….if your first purchase was after 2002-ish area, $120K is crap….

  99. Libturd in the City says:

    Chi…KMI, CRR or perhaps NES? The club researched CRR a few years ago and got scared of the Chinese. Shot up almost 150% since then. Waiting for a major pullback which probably won’t ever happen. Would love to find the company with the water filtration solution, but ABHD is a scam and NES is just terrible. Gonna go with KMI.

    By the way…still following CMG?

    I came very close to doing their IPO at $22. Needed 100K to do it and I was very, very, very close to pulling the trigger. But it would have been too many eggs in one basket for me. Hey, what’s a missed opportunity to bag 2.7 million?

  100. Libturd in the City says:

    Xolo,

    They picked it up and sent me a correction form. No reason to amend. Pretty easy mistake for them to pick up on as I’m pretty sure they kept track of the quarterly checks I sent them.

    The guys who suck are TurboTax. I let it transfer my info from last year to this year’s return and somehow they blew the amount the told me to pay in estimated. I check all of the big numbers with a fine toothed comb, but somehow messed up the amount I paid in estimated. Perhaps the extra large refund left me starry eyed.

  101. joyce says:

    Yes, context is important. However, half the people regardingless of expenses early below mid 70s in NJ.

    96.chicagofinance says:
    April 23, 2014 at 1:21 pm
    $120K means nothing without context…….it comes down to what is your payment for housing……most of those over 50 or so have small payments (unless they HELOCed or cashout refi’ed)……most of those in the 35-late 40′s area were not able to buy their ultimate house before some manner of bubble-flation warped the price…….if your first purchase was after 2002-ish area, $120K is crap….

  102. joyce says:

    wow, regarding* and earn**

  103. joyce says:

    regardless

  104. Xolepa says:

    (94) They are also the experts in gaming the system. Why are Sullivan county taxes so high? one answer – Monticello. NY state law mandates cost of obamaphones, et al have to be spread across entire county.

  105. JJ says:

    I mail in my estimated tax checks and just type the amount in turbo tax out of my check book each year. What do you do in turbo tax? I mean I am in no rush to pay estimated taxes so I just mail the check on the due date.

    104.Libturd in the City says:
    April 23, 2014 at 1:45 pm
    Xolo,

    They picked it up and sent me a correction form. No reason to amend. Pretty easy mistake for them to pick up on as I’m pretty sure they kept track of the quarterly checks I sent them.

    The guys who suck are TurboTax. I let it transfer my info from last year to this year’s return and somehow they blew the amount the told me to pay in estimated. I check all of the big numbers with a fine toothed comb, but somehow messed up the amount I paid in estimated. Perhaps the extra large refund left me starry eyed.

  106. Street Justice says:

    This one’s making the rounds on twitter.

    Only cops should have guns

    https://twitter.com/Copwatch/statuses/458698303711236096

  107. Painhrtz - Disobey! says:

    found this gem

    while I would agree with one thing he says the rest is utter rubbish. the minute those millennials start having kids it will be a rush out of the cities

    http://finance.yahoo.com/blogs/daily-ticker/is-it-time-to-stop-subsidizing-the-suburbs–163018799.html

  108. JJ says:

    Market Post: Muni Yields Fall on Weak Economic Data
    by Hillary Flynn and Maria Bonello
    APR 23, 2014 1:31pm ET
    Municipal bonds strengthened on the long-end after receiving weak economic data on Wednesday.

    Amazing how crazy low long term yields are on Muni Bonds and it was just January 2011 we had a massive massive sell off and rates were extremely high

  109. Libturd in the City says:

    JJ. I use the Electronic Federal Tax Payment System tax payment service online. It’s free and takes my money electronically the day that it’s due. Once I do my taxes each year, I setup the payment schedule for the rest of the year. Then I just have to make sure the old checking out has what it needs come quarterly tax time. Turbo Tax somehow put a different amount paid in my 2013 form than they told me send in when doing my taxes in 2012. I was probably playing around with the numbers and somehow it transferred information from an older saved version of my tax form. As you know, the beauty of TurboTax is playing around with different deductions to see how they impact your taxes. When you pay some accountant $500, you can’t do this.

  110. grim says:

    What the hell does someone do when they live in NYC and have 2 kids that aren’t the same sex? Let the kids share a room until they go to school? A 3 bedroom rental? Where and how much? I’d wager a guess at the entry point for a 3br being near $4,000 a month, and that is at the low end/harlem.

    Weigh in, please. 3 kids? You better own the hedge fund.

  111. Painhrtz - Disobey! says:

    well he is an Indian Professor Grim so that would not be a problem just stuff as many beds as possible in any room or live like the Waltons. We can call it urban homesteading!

    Line every one up like the Land Rush of 1889 on a new development and let them sprint as quickly as possible to get the best apartments slow pokes be damed

  112. Michael says:

    Exactly why I promote being a landlord. You kill it, if you know what you are doing. Why be a landlord? To profit. No one is going to continue renting out their property if they are losing money. All this rift raft of having to fix stuff, and it being a headache are lines used by lazy people. If you are making good money, did you think it was going to come for free with no work involved.

    yome says:
    April 23, 2014 at 11:20 am
    Here is real numbers
    A middle class family buying a $360,000 home putting down 20% with 15 year $288,000 mortgage at 3%.
    Monthly is $1756 a month. $1100 goes to principal. Real cost is $656.00
    Property tax is $7000 a year that is $584 a month. Cost of owning against renting is $1240 a month against renting is $2400 according to zillow.
    Deduction on tax and mortgage interest is $14,872. If at 25% bracket ,you are getting back $3718 a year.
    Now your real cost of owning is only $930.16 against $2400 renting. No more mortgage after 15 years.
    What is not affordable with that?

  113. grim says:

    Suppose you could fit 2 bunk beds in a the larger bedroom and the parents could take the smaller bedroom – theoretically you could fit 6 (occupancy limits be damned). Working with the 1 bathroom will be a little bit more challenging with 6 residents. Perhaps you could alternate days, half the family showers on even days, the other half showers on odd days. Or maybe the men just don’t shower until the weekend.

  114. Michael says:

    Renting is dead money dude. You are paying the landlord so that he can PROFIT from his real estate. What don’t you understand about that? You are helping the landlord profit, plain and simple. So who cares if the stock market outperformed real estate, it doesn’t matter, you have to live somewhere, and if you rent, you are obviously throwing away money. Plus, the key to making money on real estate, is rent. It kills the stock market when you factor in rents. What did trump and his father get rich off of? Real estate!

    JJ says:
    April 23, 2014 at 11:43 am
    Historically over last 30 years the S&P 500 has returned 10% and housing over last 30 years .74%

    Yes you save on rent owning a home but it is dead money

  115. Michael says:

    118- jj, you act like the stock market isn’t dangerous or risky. Do you know how many people have lost everything on stocks? Just because you haven’t lived through a crash that didn’t suck you dry, doesn’t mean it can’t happen. A piece of real estate that is in the right location, has almost no chance of becoming worthless.

  116. Michael says:

    And I respect you jj, but I’m just pointing out that stocks are not that much of a better investment than real estate in good locations.

  117. Bystander says:

    #96 chi,

    Exactly. This is why people in their 50s and 60s are loving life and people in late 30s/40s are hemmoraging. Kids in their mid-late 20s with 100k student loan debt are completely f-ed without a shadow of hope. The charade goes on.

    JJ,

    Agree that 120k is pittance. Can you send memo out to Barcap, RBS and other banks?they did not hear this and decided to cut contractor pay 10% across board. Apparently news of improving economy has not reached them.

  118. Essex says:

    21. I really like the rental idea. But I would much rather sell. More concerned with next spring. That’s my sale date baby!

  119. anon (the good one) says:

    @BillMoyersHQ: A new report shows top CEOs were paid 331x more than the avg US worker in 2013.
    Why the mad dash toward oligarchy? http://t.co/FrStKgEnjE

  120. anon (the good one) says:

    few yrs ago nyt had an article about families living like that. one example was teen daughter in the 1 bedroom, parents sleeping in living room and couple small kids someplace else, logic was that everybody could walk to school/work

    grim says:
    April 23, 2014 at 4:12 pm
    Suppose you could fit 2 bunk beds in a the larger bedroom and the parents could take the smaller bedroom – theoretically you could fit 6 (occupancy limits be damned). Working with the 1 bathroom will be a little bit more challenging with 6 residents. Perhaps you could alternate days, half the family showers on even days, the other half showers on odd days. Or maybe the men just don’t shower until the weekend.

  121. Juice Box says:

    re #114 – Grim – mom had 8 siblings 5 boys and 3 girls or various ages in perhaps a 900 sq ft cottage in the old country. The bedroom was always a place for sleeping and that was it. Only in America are we rich enough to worry about non-issues like this, sleeping in different rooms will not prevent a kid hell bent on messing with their sibling boy or girl.

    Another thing to mention, the immigrant workers here now sleep 12 adults to one bedroom. 6 in a day shift, 6 in a night, right next to very trendy neighborhoods in NJ and NY.

  122. Michael says:

    Damn, you guys think 120,000 is nothing? Are you kidding me? Why all the anger at teachers then?

    Also, don’t tell me someone making 375,000 a year is not wealthy, they are rich wherever you go, be it nyc or sf. It takes almost 4 salaries of $100,000 to get to 375,000. You are smoking crack if you don’t think that’s a lot.

  123. anon (the good one) says:

    BREAKING: apple split 7 to 1

  124. chicagofinance says:

    KMI is a great concept, but I is going to get overwhelmed when interest rates rise. It is no fault of the company or its results, it is just too many people are using it as a bond substitute……look at Trinity Industries…..

  125. clotluva says:

    chifi:

    Main fracking play is to be long consumables and suppliers (e.g. NOV)

    I’d steer clear of exploration companies (too little viable turf, still drilling blind, site-specific geologies means difficult to tranfer knowledge, regulatory obstacles in waiting). In short, too much risk. As it is, companies are re-exploring existing sites rather than venturing out for new ones.

    Also be on the lookout for companies that can mitigate all the lost gas due to flaring (e.g. companies with emerging technology that can recapture gas via onsite LNG conversion systems before it is flared). Lastly, be on the lookout for companies that can do the fracture with less water. This company is looking to license its technology (with some interest):

    http://expansion-energy.com/vrge_waterless_fracturing_technology.

  126. Michael says:

    126- If you make 375,000 a year, just live with a family member for two years. Invest the two years savings in real estate and stocks, and bam you are already playing with investments worth half a mil. With compounding, you should be set in no time.

  127. Ragnar says:

    22,
    The end of Bretton Woods was definitely a turning point in global finance, the world moving to entirely paper money.

    Stockman’s latest book is worth reading. He’s basically a hard-core libertarian. Anti-spending. Anti- military-industrial-complex. Anti -Reagan “Supply-Side” Laffer Curve justified deficit spending”.
    He stated, like Greenspan once stated in his pre-central planner days, that gold was a key discipliner of a runaway leviathan state. In the past, when the King ran out of gold to pay his army, he lost the war and often was overthrown. Paper money and the ability to borrow from thin air unshackles the state to run amok much longer before ultimately collapsing.

  128. anon (the good one) says:

    @BillMoyersHQ: High Inequality Results in More US Deaths Than Tobacco, Car Crashes and Guns Combined http://t.co/ar5zKp8kZP

  129. joyce says:

    And also, 3+3 is almost 7.

    I really love when we get into arithmetic lessons.

  130. joyce says:

    Ragnar,
    I’d love to believe, but I don’t recall him saying those things when he was working for the govt (nor in the private sector way back when). Only in the past few year has he started making sense.

  131. joyce says:

    Supreme Court says an anonymous tip can be sufficient to justify a decision by police to pull a car over

    … No room for abuse here

  132. Libturd at home says:

    Chi…Trinity is a very interesting company. My analysis sees it as fairly valued currently and a buy up to 73.00. Heck, it’s relative value is right around 100, which is tough to find these days of high flying valuations. Their debt’s a bit high but trending lower, they grow their dividend fairly and their ROE as well as margin is increasing. I think I’ll suggest it at our next meeting.

    So the assumptions I’m using are 10% sales and 10% earnings growth through 2019. 5-year high P/E of 19 and low P/E of 10.6 results in a projected high price of 143 and low price of 50. That’s a risk to reward ratio of 3 to 1 (in the zone). At the high P/E = the divvy that gives you a compounded return of 15.7%. At the average P/E (same as current), return would be 10.3%.

    Earnings are on the 29th. I hope they blow it. :P

  133. Ben says:

    A piece of real estate that is in the right location, has almost no chance of becoming worthless.

    But that wont stop it from bankrupting you.

  134. chicagofinance says:

    Be careful of Keystone risk…..

    Libturd at home says:
    April 23, 2014 at 10:23 pm
    Chi…Trinity is a very interesting company.

Comments are closed.