Found this on Amazon.com this afternoon, I wonder when Lereah changed his tune…
This new book is due to be released on April 3rd, 2007. I’m not the first to find it, the book has already been “tagged” by a number of Amazon users. Three to be exact, and I’ve got to give them credit for their choice of tags: propaganda before the fall, real estate hack, snake-oil salesman.
Isn’t it a little late?????
CC
Doing a little more digging, I see that Jonathan Miller found the book before I did.
http://matrix.millersamuel.com/?p=1097
I’ve got to agree with his last statement…
“Is this really worth reading?”
jb
Maybe I could keep a copy next to the toilet for motivational purposes.
Hovnanian (HOV) shares being punished this afternoon, trading down 7.5%. No doubt due to Ivy Zelman’s report on subprime mortgages that showed subprime making up 20% of HOV’s sales last year.
Home builders will feel subprime’s pain
U.S. lawmakers will have to consider providing aid to about 2.2 million subprime mortgage borrowers who are at risk of defaulting and losing their homes, Senate Banking Committee Chairman Christopher Dodd said today.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a1x64z58hsB4&refer=home
You all better lever up and get yourselves into a $1m+ home on a subprime I/O if you want a piece of that bailout.
jb
bairen Says:
Maybe I could keep a copy next to the toilet for motivational purposes.
…and you know what to do in case the Charmin is runnin’ low
Looks like Alt-A is on the verge of cracking.
From Marketwatch:
Alt-A mortgage losses accelerate, study says
Losses on so-called Alt-A home loans are accelerating and could hit the value of lower-rated portions of some mortgage-backed securities, according to a study released on Tuesday.
…
Delinquencies have jumped on Alt-A mortgages originated last year with adjustable interest rates that let borrowers pay only the interest for a time.
These loans, known as Alt-A ARM IOs, have seen a four-fold increase delinquencies of at least 60 days, four times the level of similar loans originated in 2003 and 2004, according to the study by David Liu, head of mortgage credit research at UBS, and LoanPerformance, a division of real estate data firm First American.
This “alarming” deterioration could have dire consequences for some investors in the BBB- rated parts of mortgage-backed securities (MBS) that contain these types of loans, but the market hasn’t priced these risks in yet, Liu warned.
Losses “could potentially wipe out most of the credit support on BBB- rated bonds backed by Alt-A hybrids,” Liu wrote. “And yet we have not seen any spread movements that suggest investors are taking this into consideration.”
Liu’s study, which used LoanPerformance data from the end of January, is based on the housing market remaining relatively flat over the next few years.
“If house prices fall over the next few years, everything in this scenario will be much worst,” he said in an interview.
x-underwriter
Probably not much different than the recycled stuff I bought last week.
During a bailout, what happens to the mortgage? Does it stay the same?
and why tax dollars are being used to help these people living beyond their means? while i’m working and saving to obtain my “american dreams”? this is utterly bs!
“Hovnanian (HOV) shares being punished this afternoon, trading down 7.5%”
Where’s Pesche and the nonsense regarding the bull market??
It’s starting to get interesting.. From Reuters:
Massachusetts says subpoenaed research firms on subprime
Massachusetts said on Tuesday it had subpoenaed documents from UBS Securities LLC (UBSN.VX: Quote, Profile , Research) and Bear, Stearns & Co. Inc. (BSC.N: Quote, Profile , Research) concerning research analysis of subprime lenders, including New Century Financial Corp. (NEWC.PK: Quote, Profile , Research).
State Secretary William Galvin said in a statement several Massachusetts communities have been hurt by foreclosures on subprime lender mortgages.
From Bloomberg:
GMAC Reports Fourth-Quarter Loss at ResCap Mortgage Unit
GMAC LLC, the auto lender owned by Cerberus Capital Management LP and General Motors Corp., reported a fourth-quarter loss at its mortgage unit after setting aside more money to cover losses on subprime loans.
The operating loss at the ResCap unit was $651 million, compared with profit of $118 million a year earlier, Detroit- based GMAC said in a statement. ResCap made $6.9 billion of “nonprime” loans in the fourth quarter, a 43 percent decline from the same period in 2005. Nonprime lending for the year fell 15 percent to $30.6 billion.
“ResCap has sharply reduced its production of nonprime mortgages and has stepped up its loss mitigation efforts as it relates to the company’s existing nonprime mortgage exposure,” GMAC said in the statement.
GMAC, the 12th-largest home lender to people with poor credit, is increasing provisions as delinquencies on subprime loans climbed to the highest in four years. In January, GMAC’s home-mortgage unit announced plans to eliminate 1,000 jobs.
CNNMoney.com
Will the subprime crisis punish housing markets?
Tuesday March 13, 11:23 am ET
By Les Christie, CNNMoney.com staff writer
Subprime lenders are already getting crushed – but the impact rising mortgage delinquencies will have on home prices overall is still an open question.
At a minimum, it means financing is drying up for those with less-than-perfect credit and that spells fewer home buyers.
“[National] inventory is 20 percent higher than last year, vacancy rates have soared and prices are down about 3 percent,” he says. “Now, with the tightening of credit, I don’t see how prices don’t fall another 5, 6 or 7 percent.”
The tightening of credit could take as many as one million buyers out of the market, says Baker, citing Bear Stearns research. “Even if you cut that in half, say to 400,000 or 500,000, that’s huge.”
Mark Zandi, chief economist for Moody’s Economy.com, is also concerned. “I think the subprime problems will take housing activity to a whole other level,” he says.
Zandi is projecting a doubling of subprime defaults this year to 800,000. “Those homes will go on the market at a discount and will weigh on the market,” he says. He also believes that 500,000 fewer Americans will be able to obtain financing because of the tighter standards.
All that has led Zandi to alter his projection of a 3 percent decline in housing prices this year to a mid-single digit decline. The hardest hit areas, which he thinks will be Arizona, Nevada, parts of California and Florida, which will absorb high single digit or even double-digit punches.
Baker, perhaps the most pessimistic of the prognosticators (he is someone who sold his Washington, D.C. home a couple of years ago in anticipation of it falling in value), saves most of his concern for the markets that had the most speculation – Las Vegas, Arizona and parts of Florida. Meanwhile New York, Boston, and coastal California, and even D.C. should hold up okay, he says.
http://biz.yahoo.com/cnnm/070313/031207_new_real_estate_reality.html?.v=1&.pf=loans
Wow, and on Amazon’s page it says – ‘people who bought this book have also purchased ‘Care and Feeding of Passenger Pigeons'”
Hat tip to Ben. From the Patriot News (PA):
Foreclosure filings in state shoot up 34 percent
The state Department of Banking wants consumers to know what they’re getting into when they take out a mortgage.
That’s why the department is proposing new rules that would, among other things, require lenders to verbally explain the lending process and the terms and conditions of a loan rather than rely solely on paper work. The department expects to publish the proposed regulations in the next few weeks.
The department also is resurrecting legislation that would require lenders to send a notice to the Pennsylvania Housing Finance Agency when borrowers fall behind in their payments. PHFA offers an emergency mortgage-assistance program.
Receiving such a notice — something lenders routinely send to borrowers — would give the state a simple method to track foreclosures. As it is now, the state government must rely on private companies to provide it with data or ferret out numbers from the county courts or sheriff’s departments.
“It would give us a better handle on what’s going on in the mortgage market,” said Dan Egan, spokesman for the Banking Department.
The state agency has been pushing for reforms ever since it released a foreclosure study in 2005.
Per Reuters “Countrywide CO “This is now becomming a liquidity crisis”.
Sorry no link folks and I can’t cut n’ paste from Kobra
That should be “CEO”, late afternoon, no coffee = can’t spell.
More coming in… “We’re having the hard landing we talked about 3 qtrs ago, and I don’t think we’re finished yet. It’s going to get uglier.”
CEO is on CNBC right now.
“Econ. neg. impacted”.
1)Complacency
2)Concern
3)Fear
4)Panic
If clotpoll wanders in, tell him, apropos of one of his comments yesterday, that I appreciate his stance of not trolling for clients here, and I triply appreciate this site. Keeps me sane while everybody and their uncle tries to tell me that the RE market is doing great. If our current agent dumps us, we’ll call Grim, but at the moment we think we’ll be laying low for a few months in any event.
“This is now becoming a liquidity crisis”.
That’s exactly right.
243.54
“we’ll be laying low for a few months in any event.”
patient,
Take a siesta for a year or two.
njpatient…stay sane. It’s coming.
I was just hanging around the copier and spotted a fellow employee who is a long-term RE investor…for retirement. Asked her if she was going to go out and snap up a few this Spring.
“Nope,” she said, “But funny you should ask, Pat. The owners I’ve met through clubs, etc., are starting to get excited again. The other night one of them who hasn’t been out to see a property in three years popped up and started talking RE again.”
The old dogs are starting to raise their heads and sniff in the wind now.
Hahahahaha
Just about everyone who has a hand in RE have been calling bottom since the market peak.
DO NOT TRUST A STARVING REALTOR.
Hehehehhehehe
this is getting fun. patience to those that have any. Most are like an infant looking for a pacifier following the masses off a cliff.
It is time to have some fun in the next 12 months. To much chatter by the show & tell crowd now it’s payback time baby!
BOOOOOOOOOOOOOOOYAAAAAAAAAAAAAA
Bob
I am going to BLEED a few dry in the next 12-18 months and they do not know it yet!
hehehehehehe
wave 3 and 4 are in the distance.
It’s going to be a nightmare for many. and you know what adults should take responsibility for their own actions.
It is fun waiting for times like these, but it takes alot of patience listening to the bozos chatter about being such geniuses.
COOOOOOOOOOOOOLASPE!
BOOOOOOOOOOOYAAAAAAAAAAAAA
Bob
“Take a siesta for a year or two.”
Pretty much not going to do anything before ’08. And then we’ll look up and put a finger in the wind before moving.
READ MY LIPS…..MISERY for many show & tellers.
Strong balance sheets will be eating richly in next 12 months.
hehehehehhee
BLEED’EM DRY!!!!!!!!!!!!!!!!!!!!!!!
BOOOOOOOOOOOOOOOYAAAAAAAAAAAA
Bob
Do you remember the commercial that was on the air in 2000 during the dotcom bubble: “What’s the matter with him, doctor?!?” “He’s got MONEY coming out of the WAZOO!!!”
It was the same era as all the stories of the toddlers and old women’s sewing circles that were making 30% YOY gains. Who was it who wrote that idiot column “Dow 36,000”?
Those people are all writing books and giving seminars about how RE is on the upswing right about now.
Good times. Wish this blog had been around back then!
http://finance.yahoo.com/currency/convert?from=USD&to=JPY&amt=1&t=1d
dollar Vs Yen
It will be absolutely criminal if there is a bail out, criminal.
So the ones that make stupid decesions get bailed out, and the ones that are trying to do the right thing get hosed? (assuming a bail out stops the housing market from declining)
Maybe it does pay to be an arse hole.
This Lierah is a thug…… has this guy no shame to release a book like this when thousands will be losing their homes because of his verbal diarrhoea? This guy is completely devoid of a conscience.
“It is fun waiting for times like these, but it takes alot of patience listening to the bozos chatter about being such geniuses.
BOOOOYAAAAA,
Whether its tulip bulbs, dot.com or Greenspan’s RE bubble, each markets geniuses are unmasked as frauds and fools. It shows you that many of the “experts/pundits” are just simpletons. Many actually fall for their own line of BS. Don’t even get me started on peer pressure. I thought I had heard it all, until that one.
When the earthquake arrives the gas lines break, the dishes rattle and the roof caves in. Well, the earthquake tremors are just beginning.
bear[31],
Huge move today.
bbb [32],
This bailout will make the S&L bailout seem like a walk in the park.
Here’s “Dow 36,000”. I didn’t realize they got a whole book out of it – LOL.
http://www.amazon.com/Dow-36-000-Strategy-Profiting/dp/0609806998
Humorously, one of the authors wrote this column in late ’05:
http://www.capmag.com/article.asp?ID=4243
saying: “there is little solid evidence that a real estate bubble is puffing up”.
Who did he cite as an expert in the same article? His co-author, who had been so prescient about the stock market in 2000:
“Getting back to bubbles: In his book Bubbleology: The New Science of Stock Market Winners and Losers (Crown Business, 2002), economist Kevin Hassett defines a bubble as “a period when the price of an asset (stocks, real estate, tulips, etc.) suddenly soars for irrational reasons and then collapses.” The key word is irrational. Prices often rise for good reason. For example, the price of a share of eBay rose from $8 in 2001 to $32 in 2003. A bubble? Not at all.”
Too damn funny.
HAHAHAHAHAHA.
Die you miserable lenders,brokers,Re agents and also greedy sellers. hehehahahahaha
A little humor;
“TOMNITZ V. TOLL: HAS THE REAL ESTATE MARKET BOTTOMED?”
http://www.financialsense.com/fsu/editorials/dawson/2007/0313.html
#34 BC Bob you thought you heard it all until what?
Like I said there had better not be a bail out for homeowners, you do stupid things you pay for it, simple as that.
Like I said if there is a bail out then people like us may be out of luck, as far as prices declining, and that is incredibly unfair and if it happens, than like I said maybe it does pay to be an arse hole.
Because if they get bailed out, then it proves there are no consequences, so why bother doing the right thing.
bbb #32
A bailout is a huge fear.
But how are they supposed to do it? Give a million people a free house? There will still be a bunch of people in houses they can’t afford, and no one to buy them at current prices.
A bailout will drag all RE prices to dirt and as a results potential new buyers can buy houses cheaply. When something is given freely, it loses value.
bbb[34],
When I was mentioning some of the so called experts, peer pressure came to mind. Many times,on this site, individuals stated the need/desire to buy as the result of peer pressure. Their friends/family are/were experts. That’s what I meant when I said, I thought I had heard it all.
That being said, I just can’t buy it. They are making the single biggest investment in their life, signing a note to pay back possibly more that a million dollars, over a 30 year term. Peer pressure actually plays a role in this decision?? That’s OK, if their peers will step up to the plate and help them with their bills if required.
Zack (37) – maybe give the proprietor of the blog a pass?
Can the government please step in and bail me out for renting since 1989? That’s a lot of forgone equity, and I’d appreciate a check for about $500k as compensation, tax free of course, just like the capital gains on selling your house for couples filing jointly.
And just to show I’m compassionate, how about some government somewhere (Kuwait maybe. They seem to like Lake Como. Lots of surf dudes over there) bailing out the beleagured NJ taxpayer?
What a joke.
“A bailout will drag all RE prices to dirt and as a results potential new buyers can buy houses cheaply. When something is given freely, it loses value.”
I don’t think this is right. Rather than giving people a free house, the gov’t would be giving them free money to spend on a house. I think this causes prices to rise. I agree with bbb at #39 – this would be a terrible outcome, most importantly because it would be rewarding bad behavior (on the part of both the borrowers AND the lenders). Completely wrong incentives.
Some local happenings at “The Manors” in South Orange:
March 12: $1.3M
March 13: $1.1M
http://newjersey.craigslist.org/search/rfs?query=%22The%20Manors%20at%20South%20Mountain%22
March 14: $900K???
njpatient,
You have faith that the government can execute a bailout? Look to Katrina/FEMA for precedent.
jb
RE #46
Sorry, that’s a different address, not the same property.
But if you need 2 more full baths (5 total), $100K each seems like a bargain.
Looks like inventory is starting to hit the market at a pretty good pace. Clot, KL, comments?
jb
calm down everyone……..this looks bad, but in reality, nothing has happened yet to push things down all that far……if you get cocky, chances are you will be slapped down…
there is a lot of noise….let see some substance……where is the Time magazine article with David Lereah on the cover in the role of bin-Laden?
grim: does bi–Lade- get me moderated?
They are more likely to bail out banks than individuals.
Any Homeowner “bailout” would probably be the opportunity to transfer into a traditional mortgage without penalty.
Trouble is, a lot of these people can’t afford a traditional mortgage.
From CNN/Money:
H&R Block delays quarterly results
H&R Block Inc., the largest U.S. income tax preparer, said Tuesday it was delaying filing its quarterly results with regulators after turmoil in the subprime mortgage market forced it to write down assets at its Option One Mortgage Corp. unit.
H&R Block (Charts) said in a regulatory filing it had to write down $29 million of assets, before taxes, at the unit. H&R Block is trying to sell Option One, its subprime mortgage lending unit.
The company still expects to record a $44.7 million, or 14 cent per share, loss for its fiscal third quarter ending Jan. 31.
Its not just sub prime.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aqTSc8Q0A21s&refer=home
” The Mortgage Bankers Association said foreclosures are climbing on loans to borrowers with the best credit ratings, a sign of broader trouble in the housing market. “
Grim (49)-
Inventory up in my bailiwick. Some, not a lot. Check back in 2-3 weeks…still a bit early.
From MarketWatch:
Subprime shakeout could hurt CDOs
After a mortgage is sold, it’s usually packaged up with other home loans into a mortgage-backed security, or MBS.
But who buys the riskier parts of these derivatives — the bits backed by subprime mortgages offered to poorer borrowers with lower credit scores? The answer may be collateralized debt obligations, or CDOs.
These complex structures, which are similar to a mutual fund that buys bonds, helped fuel the U.S. mortgage boom in recent years by purchasing some of the riskier parts of MBS that other investors didn’t want.
They could now do the reverse, according to a recent study by Joseph Mason, an associate finance professor at Drexel University’s business school, and Joshua Rosner, a managing director at research firm Graham Fisher & Co.
By exiting in search of more attractive assets, CDOs could limit the supply of money to the mortgage market, making home loans more expensive and reducing the availability of subprime loans, Mason said in an interview this week.
“We started out a few months ago trying to find out who is investing in the riskiest portions of these MBSs,” Mason said. “We found the answer to the big question: the CDO sector.”
“We are seeing temporary near-term weather disruptions in much of the country, but there is an underlying pattern of stabilization in the housing market, … As a result of these weather disruptions, it may take a couple months for the picture to fully clarify, but a modest recovery is likely. Housing remains a great long-term investment. The rapid shift in January to frigid air in much of the country had a cooling affect on home shopping that went beyond normal seasonal factors, … Weather disruptions have continued since.”
– David Lereah
ames Bednar Says:
March 13th, 2007 at 5:42 pm
njpatient,
You have faith that the government can execute a bailout? Look to Katrina/FEMA for precedent.
jb
—————————–
Jim,
Government has been good at executing bailouts. S&L during GHW Bush, and Clinton with the peso bailout in Mexico. It is just these guys in office noe that can’t do the job. By the time the next administaration comes in there will be achanging of the guard and basically a chimp is better at governing than this clown.
“The yen should benefit as the unwind of the carry trade continues,” said Tony Morriss, a currency strategist at Australia & New Zealand Banking Group Ltd. in Sydney. “With stock markets very jittery and concern over the U.S. financial system, there will continue to be an atmosphere where risk is removed.”
“Losses in the dollar against the yen were escalated by speculation mortgage defaults will slow the U.S. housing market and stall economic growth, prompting the Federal Reserve to cut its key rate, which it has held at 5.25 percent for nine months.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=aHIO7urnIgg8&refer=home
http://njrealestatereport.com/index.php/2007/03/13/lereahs-new-book/#comment-84443
Jim
No inventory jump in my little town, however I have been noting the total gsmls, it is increasing but not at the pace I thought it would.
KL
Chgo Fin I would say quit a lot has happened in only few weeks, and it is only getting started.
No need for Lereah on the cover of TIME.
I have been tracking gsmls inventory in Piscataway for a few days now. I dont have realtor access so I’m just going by the number of hits in a query.
From 2/28 to today (3/13), the total number of hits for Piscataway (all prices) has gone up from 128 to 145 (13%). The increase has been almost entirely in the 300-500k range. I am tracking 500+ and 300- but those haven’t changed much.
My comment with date/time March 13th, 2007 at 10:13 pm is awaiting moderation.
With all the talk about a bailout, it’s interesting to note who his largest contributors are:
http://www.opensecrets.org/politicians/allcontrib.asp?CID=N00000581
Now try to figure out who exactly is going to be bailed out.
From Realtor.org:
WASHINGTON, March 13, 2007 – Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions,
but a recovery is likely this year, according to the latest forecast by the National Association of Realtors®.
David Lereah, NAR’s chief economist, said there is some ambiguity about the current housing market. “Our goal each month is to fine-tune the forecast based on the
latest housing data and a variety of economic indicators, but extraordinary weather variations are skewing home sales and clouding the picture,” he said.
“Underlying trends point to a housing recovery in 2007, but it will take a couple months for us to get a better handle on it.
Existing-home sales are expected to slowly improve from what appears to be the cyclical low last fall, but we think there will be some additional
pain in the new home market, which hopefully will start to rise later in the year.”
#66 God you just have to love David, smile wave be happy, don’t worry. Dave says all is fine just a litlle more pain, and then it will be up, up and away again. $1,000,000 POS capes for every one!! YIPEE!!!