From the Associated Press:
Poll finds New Jerseyans feeling gloomy on economy
Economic woes have New Jerseyans gloomy, a new poll has found.
Forty-nine percent of respondents in the poll issued Monday by Fairleigh Dickinson University’s Silberman College of Business said they’re worse off financially than they were a year ago. That’s up from 41 percent in a January poll.
The new poll also found only 25 percent think they’re better off financially.
“The prospect of a broad economic downturn continues to cause discomfort throughout New Jersey,” said William Moore, FDU’s Silberman College dean. “People are ever-hopeful for their personal prospects, but this economy is fragile and things may get worse before they get any better.”
The poll found 40 percent think they’ll be better off financially a year from now, compared to 35 percent who think they’ll be worse off.
…
However, respondents younger than 30 are more upbeat about their position and prospects. Half of them say they’re better off now than a year ago, and more than half say they’ll be better off a year from now.Those 45 and older, though, say they’re worse off.
…
The poll found 79 percent don’t plan on taking on more debt, with 31 percent saying they have either a “somewhat” or “very difficult” time making debt payments.
Hey..
Bennie & the Fed!!
No more rate cuts, you are destroying the dollar.
Time to get rid of the private Federal Reserve system.
SAS
“However, respondents younger than 30 are more upbeat about their position and prospects”
Question:
How many of those surveyed still live with mom & dad? and therefore don’t have a firm grip of financial reality?
NJ home of dead beat kids.
yup
SAS
From Reuters:
Investors, not Fed, to blame for crisis-Greenspan
Former Federal Reserve Chairman Alan Greenspan has defended himself from charges that easy U.S. monetary policy created the current credit crisis by inflating a housing bubble, and instead blamed professional investors.
In an article in Monday’s Financial Times newspaper, Greenspan wrote that the housing bubble which inflated between 2001 and 2006 had not been unique to the United States.
“The U.S. bubble was close to median world experience and the evidence that monetary policy added to the bubble is statistically very fragile,” Greenspan wrote.
…
Instead, Greenspan placed blame for the U.S. housing and subprime mortgage crisis at the door of investors. “The core of the subprime problem lies with the misjudgments of the investment community,” he wrote.
Subprime-mortgage securitisation exploded because it appeared misspriced and there were few delinquencies and defaults, “creating the illusion of great profit opportunities”. Lenders were then pressed by securitisers for mortgage paper “with little concern about its quality”.
Greenspan also said he doubts tightening of regulation would have solved the problem. “The problem is not the lack of regulation but unrealistic expectations about what regulators are able to prevent,” he wrote.
From Thompson Financial:
UBS to cut at least 2,000 jobs – report
UBS AG is getting ready to cut at least 2,000 jobs, the Sunday Times reported, without naming sources.
The job cuts, mainly in New York and London, would more than halve the bank’s fixed-income and proprietary trading divisions, the newspaper reported.
From Bloomberg:
Overseers Shocked to Discover Oversight Flaws
Once a crisis hits, politicians try to look like they are doing something to help. The current overlapping system of regulation is largely a result of Depression-era fixes.
Clearly if the Fed is lending money directly to investment banks, the central bank needs to have access to the books. Which begs the question of how highly regulated commercial banks got into so much trouble, forcing them to write down tens of billions of dollars in bad loans and to raise tens of billions of new capital.
Maybe we need better, smarter regulation, not more. Among the ideas floated by Treasury Secretary Hank Paulson last week in his blueprint for regulatory reform was for the Fed to become a kind of uber-cop, sniffing out financial instability wherever it lurks and making surgical strikes where necessary.
“Rather than focus on the health of a particular organization, it will focus on whether a firm’s or industry’s practices threaten overall financial stability,” Paulson said.
That sounds nice, but if Fed policy makers can’t identify an asset bubble until after it has burst (by their own account), how can they anticipate the next threat to the financial system?
From the WSJ:
Washington Mutual to Get $5 Billion
TPG, Others Offer Lifeline for Stake; Hard-Hit Markets
By MATTHEW KARNITSCHNIG, VALERIE BAUERLEIN and ROBIN SIDEL
April 7, 2008; Page A1
Private-equity firm TPG and other investors are close to a deal to invest $5 billion in Washington Mutual Inc., people familiar with the matter said Sunday.
The injection of new capital would allow the country’s largest savings and loan to ease its pressing capital requirements, the people said, amid punishing losses from the national mortgage crisis. But it would substantially dilute current WaMu shareholders, who have already lost 74% of their investment over the past year. WaMu’s market capitalization on Friday was just under $9 billion, after its shares dropped 11% that day.
From the Washington Post:
Local Banks Feeling Pinched
The Federal Reserve’s aggressive moves to reduce interest rates are posing new problems for regional and local banks already suffering setbacks from the housing slump.
The Fed has cut the federal funds rate, the key interest rate it controls, six times since September in an attempt to ward off a financial crisis. And with each cut, the rate banks can charge a variety of businesses and consumers has often fallen as well.
Community banks, in particular, are seeing their profits decline because they tend to rely on small-business and real estate development loans that adjust almost immediately to a rate cut by the central bank.
These smaller banks are also more reliant on certificate of deposit accounts, which pay out fixed interest rates to their customers over set time periods, meaning in a time of rapid rate reductions they are locked into paying higher rates until the term expires.
The housing slump is bringing other worries. Most community banks have avoided the losses from the subprime mortgage crisis that has plagued some of the bigger national banks and Wall Street investment firms.
But smaller community banks are not immune to the secondary affects of the housing market’s downturn. Developers can default on construction loans if real estate prices plunge and projects fail.
From the Star Ledger:
Paid family leave mandate is expected to pass NJ legislature
The state Senate is scheduled to vote today on legislation that would make New Jersey the third state in the nation to create a paid family leave program.
The bill would allow employees to take up to six weeks off to care for a newborn or a newly adopted child, or a sick parent, child or spouse. Workers would be required to pay a tax to the temporary disability insurance fund to support the program, amounting to about $33 a year.
Employees would be entitled to two-third of their pay, up to $524 a week.
If the bill passes, it goes to Gov. Jon Corzine who has promised to sign it into law.
Labor and consumer groups have lobbied for the legislation for nearly a dozen years, arguing it is a compassionate way that would improve morale. Business leaders and employers oppose the measure because they predict their operations would grind to a halt without key employees.
http://www.marketwatch.com/news/story/china-let-banks-buy-us/story.aspx?guid=%7B6F5A6292%2D0E2C%2D4AB3%2D8501%2D52DABC307E99%7D
China to allow investment into U.S. stocks, funds
Chinese banking and securities regulators signed an agreement with their U.S. counterparts Monday that will help lay the groundwork to enable mainland investors buy and sell U.S. securities, according to multiple reports.
Roubini on decline of home prices.
Nouriel Roubini, a professor of economics, foresaw the current mess in U.S. housing and financial markets (see this article, for example). He recently gave an interview and had this to say:
“Two years ago, I predicted home prices would fall cumulatively 20%, but now I believe it will be at least 30%.
With a 20% fall in home prices, about 16 million households are under water. They have negative equity, which means the value of their homes is below the value of their mortgages. With a 30% drop in prices, you have 21 million households that are in negative equity. And since the mortgages are no-recourse loans, essentially they can walk away.
Even if only half of the 16 million households were to walk away, that alone could lead to losses for the financial system of $1 trillion. Even a 20% drop in home values may imply losses of $1 trillion that are not priced into the market today. So that’s the floor. Again, it could be higher — as much as $2 trillion — if prices fall 30% and more people walk.”
Homebuilders Emerge From the Penalty Box
We view these stocks as “canaries in the coal mine” and just as they first signaled how bad things were going to get last summer, they may be telegraphing an improvement in the broad market.
I’m noy buying this one,but its one view.Charts are interesting.
http://seekingalpha.com/article/71376-homebuilders-emerge-from-the-penalty-box
JB,
Very sorry to hear about your pup.
Dont Know if this has been posted; subprime map.
http://www.nytimes.com/imagepages/2008/04/05/business/20080406_METRICS.html
From the Financial Times:
Alan Greenspan: A response to my critics
I am puzzled why the remarkably similar housing bubbles that emerged in more than two dozen countries between 2001 and 2006 are not seen to have a common cause. The dramatic fall in real long term interest rates statistically explains, and is the most likely major cause of, real estate capitalization rates that declined and converged across the globe. By 2006, long term interest rates for all developed and major developing economies declined to single digits, I believe for the first time ever.
Doubtless each individual housing bubble has its own idiosyncratic characteristics and some point to Fed monetary policy complicity in the US bubble. But the US bubble was close to median world experience and the evidence of monetary policy adding to the bubble is statistically very fragile. Paul De Grauwe depends on John Taylor’s counterfactual model simulations to conclude that the low funds rate was the source of the US housing bubble. Taylor (with whom I rarely disagree) and others derive their simulations from model structures that have been consistently unable to anticipate the onset of recessions or financial crises. This suggests important missing variables. Counterfactuals from such flawed structures cannot form the basis for policy.
Funny part if the people over 45 are all in debt in NJ why the heck are they upset that rates are being cut?
Any adjustable rate debt that falls is good news for them and if they have high rate fixed debt it either gives than a chance to consolidate or god forbid prepay debt. So if they have no money why do they care if rates fall to zero?
Poor Al, I guess he’s realized his little best seller isn’t going to have the final say when it comes to his legacy.
Question: what is a “notice of settlement” in regards to a mortgage? Why & when would that be used?
TY!
Luxury car sales show the rich are spending less…
http://www.usatoday.com/money/autos/2008-04-06-luxury-car-sales-dealers_N.htm?loc=interstitialskip
Everyone back into the pool!!!!!!!!
Anyhow, checked my bond screen this morning and rates have dropped like a brick. Scattered muni PR bonds and a few muni NY/NJ Tobbaco and Dorm Auth bits and pieces that are all close to 3% and on the corp bond side even Wamu, CIT, SLM, NCC bonds are back yielding in the single digits.
Big Ben rate cuts are finally working and he may pull a 25bp and done song and dance April 30 and show he now cares about inflation.
This means that guys like me are going get forced back into riskier things then the investment grade bonds and munis we have been feasting on since Holloween.
That is good news for our 401K and stocks.
Slackards every where re-joice. I agree in principal wtih it, but we already have something like it at my work and the mistake we made was allowing people pay to take off for a sick parent who is not their dependent or lives with them. Dad’s wife could be alive and kicking and doing all the work but all four kids could get a paid vacation for nothing. It should have been only for parents that the kids actually take care of.
grim Says:
April 7th, 2008 at 6:22 am
From the Star Ledger:
Paid family leave mandate is expected to pass NJ legislature
The state Senate is scheduled to vote today on legislation that would make New Jersey the third state in the nation to create a paid family leave program.
The bill would allow employees to take up to six weeks off to care for a newborn or a newly adopted child, or a sick parent, child or spouse. Workers would be required to pay a tax to the temporary disability insurance fund to support the program, amounting to about $33 a year.
Employees would be entitled to two-third of their pay, up to $524 a week.
If the bill passes, it goes to Gov. Jon Corzine who has promised to sign it into law.
Labor and consumer groups have lobbied for the legislation for nearly a dozen years, arguing it is a compassionate way that would improve morale. Business leaders and employers oppose the measure because they predict their operations would grind to a halt without key employees.
Alan Greenspan: A response to my critics
Wasn’t Alan the one who discounted of using Housing or Rent equivalent housing component from CPI numbers to defend Interest rate cuts?
Not sure about the history, but why would they use Rent equivalent component when 68% of population prefer to own rather than rent. At the least they should have used home prices to the extent of population that own home and rents for other population.
#3 You gotta love papa bear.
From Reuters:
NBER’s Feldstein says US has slid into recession
Martin Feldstein, president of the National Bureau of Economic Research, said on Monday that he personally believes the U.S. has been sliding into a recession since December or January.
Feldstein told CNBC television that he believes a recession could go on longer than the two most recent recessions.
He also said the U.S. gross domestic product number for the first quarter will be a “misleading” number.
The NBER typically declares start and end dates for U.S. recessions. The group has not declared the economy is currently in a recession.
http://www.bloomberg.com/apps/news?pid=20601039&sid=a4apzbNj60n0&refer=home
Paid family leave mandate is expected to pass NJ legislature
and just in time for the summer! I wonder how many people will have a “sick relative they need to take care of” just in time for beach season?
“UBS AG is getting ready to cut at least 2,000 jobs, the Sunday Times reported, without naming sources.
The job cuts, mainly in New York and London”
But not in the Manhattan part of New York.
Rent,
They’ll need to wait until July of 2009. Payroll deductions don’t start until next January, benefits start the following June.
hehehehehehe
“Poor Al, I guess he’s realized his little best seller isn’t going to have the final say when it comes to his legacy.”
so true. We’re only in chapter three of the story, too. So much more to be written, and the guy’s 82 years old, so there’s a pretty good chance that the final word will be had after he’s shuffled off his mortal coil.
“He also said the U.S. gross domestic product number for the first quarter will be a “misleading” number.”
Misleading numbers? From our current crew of misleaders?
Nah.
“I wonder how many people will have a “sick relative they need to take care of” just in time for beach season?”
I have three tiny Patients that bring home a couple of colds/viruses per week. I might never go to work again.
Seems like everyone is rolling these out.
MAJOR PRICE REDUCTION FOR ONE WEEK ONLY 4/6/08 – 4/12/08 $ 343,000. DON’T MISS OUT !!! Custom Designed Cape Colonial. Home has been extremely well maintained & updated.
http://emailrpt.gsmls.com/public/show_public_report_rpt.do?report=clientfull&Id=30462949_11260
So what happens to the homes that still don’t sell, despite having undergone a “MAJOR PRICE REDUCTION”?
They’ll remain majorly overpriced, I suppose.
8 paid family leave mandate
Sounds like a great idea to me, hope it passes. Being able to take time off and receive some pay for it, so you don’t go bankrupt, while your mother or father or husband or wife is dying of cancer, for example, is a good thing for all of us.
#30
Interesting marketing strategy for a house.
I guess they consider $26,900 to be a major price reduction.
I wonder if they plan on relisting the house at full ask after the week?
What is a Cape Colonial?
To the Realtors, which is more difficult?
1)Getting the players off the bench, signing a contract.
2)Hitting a home run, delivering that signed contract to a successful closing?
I am pretty funny when I once in a blue moon see a house I like. Which is rare, I e-mailed one this morning and asked her to contact me when she has an open house as I am too busy to be bothered to make an appointment to see it at the current price. Also I told them to contact me when she lowers the price on MLS. Otherwise do not contact me. Nowdays you like to set an expectation you are not that interested and you think the price is too high up front. While in 2006 if you did this you never heard agan.
HELP! Guys, I put in a bid on a condo, and I want to back out of it. It is past attorney review, but I found out that I was not qualified for financing. The realtor is quite p/od about this.. and wants me to get qualified from her broker (perhaps its possible)? If anyone has thoughts on this, let me know. Max loss = $2000 if i walk away (deposit)
GS Grim re 30 They don’t have a prayer in hell.That is around the block from me.You can get brand new here for 309.I know these prices sound cheap to the Bergen buyers but not in Vernon.I bought for 132 in 98 & sold for 297 in 06 that’s insane.Although I can’t complain.At 290 it would have a chance
just a chance of selling.Maybe some idiot will give them what they want you never know.I’ll be watching it.
Can I kindly ask 1 of you to check for info on this listing, NJMLS Listing Number: 2807150. Thank you!
36 Walk, $2000 lesson in re.You will surely recoup by waiting a while.Maybe you can get out with the money see a lawyer.
Jase,
272 Sunset
Listed 1/28/2008 for $424,900, reduced to $399,900. 71 days on market. I believe it was purchased in July of 2002 for $235,000.
# 9 “Chinese banking and securities regulators signed an agreement with their U.S. counterparts Monday that will help lay the groundwork to enable mainland investors buy and sell U.S. securities, according to multiple reports.”
Ahh, some demand to help prop up the market.
As for the sub 30s feeling good about the future, of course they do. One finishes college and starts earning and one feels good. One gets the first job and one feels good. One maybe leaves behind the first job, either from promotion or moving to a new company, thus earning more money,one feels good. When one has little, any addition provides an outsized benefit and with it good feelings. Once one has accumulated some assets and wealth, one’s attention turns to KEEPING what one has; which can be more difficult than getting it in the first place.
Ministry,
Contact your attorney.
Thank you, Grim.
Novartis to Buy Nestle’s Alcon Stake
In Two Steps for Around $39 Billion
Hey did you all see the homes “on sale” listed in the paper this weekend. What happens to those homes that don’t sell for the limited time reduced rates – do they go back up the following week?
A cape colonial is like a $500 car cover on a pinto.
BC Bob Says:
April 7th, 2008 at 10:05 am
What is a Cape Colonial?
To the Realtors, which is more difficult?
1)Getting the players off the bench, signing a contract.
2)Hitting a home run, delivering that signed contract to a successful closing?
Ministry,
Read your mortgage contingency clause.
Yeah, I hope this NJ family leave thing passes…and I hope businesses already fed up with NJ will view this as another reason to relocate. We can always work for Target…
cape colonial = cape with the roof blown out.
thanks guys for the tips.. i’ll look through the contract in detail again.
Ministry,
Was this a new condo complex that requires a deposit? Or was this the “Good Faith” deposit?
BC Bob Says:
April 7th, 2008 at 10:05 am
What is a Cape Colonial?
Bost: It’s where NASA launches rockets into space….
It’s not a new condo complex, but an older one.. more of the good faith deposit.
Went to few open houses in central Jersey yesterday….
Still grossly overpricced.
But lowest priced homes qwere getting TONS i mean TONS of traffic – this house:
http://www.realtor.com/search/listingdetail.aspx?ctid=28643&mxp=25&typ=5&sid=c4a39bf58d944771992718d77493c4ea&lid=1097722717&lsn=2&srcnt=6#Detail
It is a teardown. But there were over 100 people lookign at it walking in and instantly leaving. I guess people did not like to see 260K+ plots of land + costs of tear down and debree removal.
Also As I said there are few lower priced listings, but mostly – asking prices are ridiculous. IN ALL towns. Not only premium ones.
2008 Spring = not a good time to buy a house.
Re: #10 quotes “Even if only half of the 16 million households were to walk away,”
Does anyone realistically think that as many as half or more people are going to walk away from their homes just because they are underwater? I think that is a huge stretch. I would think 10% would be a lot. I think most in that siuation, assuming they can afford the payments, will stick it out until their house value rises. Or am I being naive?
# 55
If one is in a situation where they are barely making it and they are faced with two choices 1) continue to barely make it with no hope of getting ahead in any meaningful sense because they are under water and prices may not rebound for years or 2) walking away and getting into a less-expensive rental that allows them to sock away a few dollars for emergencys or to send the kids to college, or buy the new car, or whatever I can see some folks (who may never have dreamed of doing so) walking away to protect their families.
It’s hard to imagine walkaways being 50%, but it is the smart choice for a lot of people and the more people do it, the less stigma
I love this paragraph by Peter Schiff in his newsletter to investors.
In Senate hearings this week, all parties involved completely ignored the Fed’s own culpability in igniting the speculative fever. It’s as if a senior prom had turned into a wild bacchanalia, and angry parents now question why the chaperones failed to notice the disrobing or why the DJ played provocative music, all the while ignoring the bearded gentleman pouring grain alcohol into the punch bowl.
This is becoming more common.
$20K REDUCTION! TILL APRIL 13 ONLY!
Rush with your checkbooks.
It’s hard to imagine walkaways being 50%, but it is the smart choice for a lot of people and the more people do it, the less stigma
That’s why will never be Japan. Due to pride and saving face they stayed in their himes for over a decade and payed their mortgage. They ate noodles budgeted but saved face and didn’t foreclose. Here we have no shame and proudly stick it to the lender.
There was an interesting in-depth story on NPR Marketplace Money this weekend about the housing crisis. It also details two families who decide to ‘just walk away’
http://tinyurl.com/5ue59y
A snippet:
Sinclair: If they reduced our interest rate back to 4.25, we might be able to make the payments, but I don’t think we’re going to.
Vigeland: Now, why not?
Sinclair: We would do it if the equity was there, but in a case where we’re already so behind… Imagine that for five years, say, we’re gonna pay four grand a month and then we’re just gonna be back up at what we bought the house for. We feel like we’re throwing away money.
CB in SJ Says:
April 7th, 2008 at 11:10 am
Re: #10 quotes “Even if only half of the 16 million households were to walk away,”
Does anyone realistically think that as many as half or more people are going to walk away from their homes just because they are underwater? I think that is a huge stretch. I would think 10% would be a lot. I think most in that siuation, assuming they can afford the payments, will stick it out until their house value rises. Or am I being naive?
CB: We are in uncharted territory…..I don’t think any outcome is on or off the table. Honestly, I think the real concern is the potential of removing the stigma of “walking away”. If it becomes socially acceptable, the action will snowball….
We feel like we’re throwing away money.
Amazing, all this time I was told that renting was “throwing money away”.
Now, I find out that paying your mortgage is too?
Whew, it sure is tough to keep these memes straight.
From Craigslist,
Depending on your interest, I would prefer a cash sale as is but can negotiate any work you wish done prior to you moving in. We can repaint with your colors, add siding of your choice, add new cabinets and countertops, and refinish the hardwood floors once the house is empty. I would also be willing to accept some trades of value towards purchase price including cars, trucks, and other items of value. Bottom line is I’m willing to work with you if your looking for a home in hunterdon county. I may be willing to rent the house back from you for a short term as well.
Serious replies only, please do your research on comps in hunterdon county and lets put something together. bring all offers! thank you!
http://cnj.craigslist.org/rfs/586738266.html
HELP! Guys, I put in a bid on a condo, and I want to back out of it. It is past attorney review, but I found out that I was not qualified for financing. The realtor is quite p/od about this.. and wants me to get qualified from her broker (perhaps its possible)? If anyone has thoughts on this, let me know. Max loss = $2000 if i walk away (deposit)
don’t walk away. RUN AWAY. FOREST GUMP STYLE.
#62 & #63
It just boggles my mind that people could be so irresponsible. I mean, you buy a car and it depreciates, and cars are often worth less than one owes. But housing is different in some people’s mind’s I guess. I am pretty sure if I bought a house I liked at a payment I could afford, I would not be overly concerned with its market value unless I suddenly needed to move. I guess I am naive.
Cash buyer? Hmm, seems to me that the home is likely torn apart and won’t get a C/O without substantial work (or appraise).
New trick. Register domain name with address of house.
http://www.1003vosselleravenue.com/1003vosseller/index.html
Now only if they put discussion board on that site where visitors can discuss the property.
I don’t blame these people for walking away. The banks were stupid to loan them the money. But given that these ordinary Americans are proving to be so sophisticated and opportunistic, it seems a little unfair that they are no longer taxed on debt forgiveness
SG,
Got to at least give them credit for putting up the site. Easier to navigate than Realtor.com (or other MLS system) listings.
This used to be the realm of tech-savvy FSBOs, but it seems to be a bit more commonplace these days.
If walking away will become a norm – will banks still lend money or will they justreq
If walking away will become a norm – will banks stop lending money or will they just reqire 50% downpayment and what will it do to the market?
Off Topic
A while back there was the Snapping Turtle Robbery. It has been topped.
NZ man ‘used hedgehog as weapon’
http://news.bbc.co.uk/2/hi/asia-pacific/7334233.stm
# 66
The thing that has happened is that we as a society have gone from viewing a house as a home to viewing it as another investment asset. As such, people are treating them like other financial assets and making decisions based on the bottom line, even if it is a short-term bottom line.
As for me and Mrs. Shore, we do not count the value of our home, our cars, or our emergency funds in any net worth calculations. Those are off the table so we do not consider them as part of our worth.
Well, this one created Blog for selling their house.
http://2102doolittledr.blogspot.com/
Include home video and comments section as well.
# 75 “*** Owner is NJ Real Estate agent *** ”
Read as: RE agent bought to flip and is currently sucking wind. Please, please, please take this millstone from around my neck?
#74
Shore– treating a home like an investment is a completely reasonable response to how expensive homes have gotten. It’s a little hard to ignore the investment angle when a home is by far the biggest expense and asset for most families.
I understand that approach. And I agree that second, third, and additional homes should be treated that way. For my own comfort level, those things that I need toi live and make money: home, cars, business attire, yadda, yadda, do not count as far as my assets. Nor, for that matter, do the kid’s college monies, as those funds are allocated. My view may me skewed inasmuch as our home has not been anything near our biggest asset in some time. Nevertheless, since it is for most people, and people are viewing housing like just about any other asset, we should not be surprised when folks stop acting kike our parents and grandparents did and, instead, walk away from what they think is a bad business deal.
I agree with the over-priced stuff. It’s f*cking unbelieveable. I drove through a few towns from Hillsdale over through Westwood to Harrington Park. My wife didn’t even want to go, she said she didn’t want to waste her time. 690K for a POS bilevel, 2.2 MILLION for one that I thought was around 900K. Things are still way…way….way out of whack. There’s no way I could possibly even think about trading up from my current home. And why would I want to??
I’d have to take every penny I made from my current sale plus a hefty chunk of savings and STILL would be paying almost double in PITI for anything considered decent. It’s sad, pathetic and people are f*cking ga-vones. Unless you hit the lottery or was handed an inheritance, you’ve got to be nuts to buy a home in this pathetic place called New Jerkme.
gary:
In Harrington Park,, what did you think of the pricing? how about the townhomes?
Unbelievable
#78
Shore– I think it’s just the reality that most people are unable to think in this way. When you see that the median downpayment of 1st time buyers during the past few years was 3% and that people are increasingly paying close to 50% of their income toward housing, there’s no other option but to view the place as a very high risk investment. It’s like we’ve turned into a nation of mini LBO shops over the past 5 yrs… w/o the deduction of interest and the thought of “liquidity events” such as cash out refis and flipping for a profit down the line, the whole concept of homeownership for millions of people would be pointless. It is very interesting to watch these LBOs blowup at the same time as people walk away from their houses
Mark [80],
I’m astounded and shocked, no other way to put it. I figured that the bland, non-descript, dated, dull and dingy bilevel on a 60 x 100 lot would be listed in the low 500s… and that would be pushing it. It’s freakin’ sad.
re: (79,80,82)
Gary I was looking in the Brigadoon of Bergen County on Saturday and based upon the prices
you would think the streets were paved with gold and the school system put out Nobel Laureates every year.
I guess the recession has not sunk in yet in Bergen County.
Ten Comments on Housing
http://seekingalpha.com/article/71291-ten-comments-on-housing
Interesting link from the comments over at CR:
Fannie Mae says no to credit scores below 580
Fannie Mae is setting new rules about what mortgages it will buy, including a credit score threshold for the first time.
The Washington, D.C.-based mortgage giant has told lenders it no longer will buy most loans made to borrowers who have credit scores below 580, nor will it buy loans that have been more than 60 days past due within the last year.
Without evidence that extenuating circumstances led to a foreclosure, it also no longer will buy mortgages made to borrowers who have lost a home to foreclosure within the last five years. Fannie Mae currently considers buying mortgages after four years have passed.
The new rules go into effect June 1.
“The dramatic shifts in market dynamics over the past several months have prompted us to continually review the full spectrum of our risk appetite, eligibility requirements, automated underwriting risk assessment and pricing,” Fannie Mae said in the revised guidelines.
do i have a story for everyone on this blog…
was out looking in Mountain Lakes yesterday – first time driving around that town – the Mrs. said that their school district was the best around the area….
first of all, the houses seemed nice but still way overpriced for what they offered….the second house we walked into, the realtor came up to us and asked us if we were working with a realtor and we told her that we already have one….she asked if the realtor was from mountain lakes…her next comments shocked me –
“i suggest you drop that realtor and use one of us that know the area. the mountain lakes community is real small and everyone knows everyone else and you will be better off using me. i know when the mountain lakers want to sell their home before it hits the market and your realtor will not have that kind of information.”
needles to say, we took her mountain lakes brochure for the home since it was a ‘home event’ (whatever that means) and left…..
the actions of one realtor is enough for me to look somewhere else…..i will have to put my kids through private school i guess since the amount of taxes and home prices i will have to pay in that town is much more that what private school is going to cost for the little one…
CAIBC
CAIBC,
She must be pretty hungry to resort to those tactics.
I came here from around the Stockton, CA area, and I can tell you: 50% walkaways make sense.
In any new development, you can see 3-5 homes for sale on the same block, on each block. All of them have brown lawns, since the water was turned off. Your house needs to be in pristine condition if you want to get an offer; some scuffs on the wall can kill interest (why bother when the house next door doesn’t have them). Bad roof? Might as well tear the whole house down, because no one will dare look at it.
I suppose if someone can afford the payments, then it’s less likely that they’ll walk away. True enough. However, none of these people could afford the payment. It’s a question of rates resetting (they all had no-doc ARMs with teaser rates, because if they didn’t, they couldn’t buy).
Also, another lesson from Cali: most buyers will only use the asking price as a guideline for making their offer. When an offer comes in, it’s typically 20% under asking. So, how do you sell? Make sure your house is in tip-top shape with wow factor, then put out an asking price at 25% above what you want to receive. If you set it to the market price, you’d just get bids at 20% below that.
We buyers should go to sellers with what we’re willing to pay, independent of the asking price. Sure, perhaps 9 times out of ten, we’ll be laughed out of the room. But then again, maybe they’ll come crawling back to us in a month.
Never, never overpay.
if you think harrington park is sad, try
closter,,, hub of the Northern Valley.
From the NYT Freakonomics blog:
A Look Back at the Subprime Mess (or: Itzhak Ben-David Is a Prophet)
Back in June, 2007, we wrote a column about the research of Itzhak Ben-David, a Ph.D. candidate in finance at the University of Chicago. He had been studying the cash-back transaction — a real-estate sleight of hand in which cash-poor buyers received an unrecorded cash rebate from the seller in order to qualify for a loan.
This would result in the buyer sometimes borrowing 100 percent (or more) of the house’s value. That means that borrowers who were subprime to start with are taking on even more debt, creating a loan that’s just waiting to blow up.
Here’s my question: If an academic researcher like Ben-David knew as much as he did for as long as he did — while we wrote the article last summer, he’d been working on this research for a long time — why were so many people, including smart people at sophisticated institutions, caught off-guard by the subprime developments?
Sean [83],
For the first time, I’m giving it some serious thought as to why I want to stay in this area any longer. I have no idea why anyone would want to pay upwards of $750,000 to live in anything considered “nice” with $15,000 in taxes. It really alludes me. Salaries have remained realitively flat for years as the prices of these ‘houses’ have doubled.
I’ll say it again: You’ve got to be f*cking crazy to go in the hole for these houses at these prices.
“i suggest you drop that realtor and use one of us that know the area. the mountain lakes community is real small and everyone knows everyone else and you will be better off using me. i know when the mountain lakers want to sell their home before it hits the market and your realtor will not have that kind of information.”
I’d agree with you – I do nto want to live in town were there is organized realtor’s MOB…
Scary stuff :)
My favorite conversation of yesterday:
Visiting open house – small ranch in Piscataway:
Listed at 319K, outdated, smell horribly, everything old.
A mile down there is the same model and year ranch, a bit more updated, twice the size of the lot, for 265K.
Realtor from 319K home asked me at the open house –“So what do you think?”
I said:
“well I think this is a nice house, but I do not see why it is listed 60K above exactly the same ranch on double size lot, in the same township/location, while being older and less updated”
– and I gave him the fact sheet from he other home. (I think additional injury was that the cheaper house was not a closed sale but active listing, with over 100 day on the market, so he really had nothing to say about it. No possible excuse.)
Dead silence from the realtor was my best answer. I kind of felt bad because it was not his fault – probably, but he zalso coult have rejected the listings.
Also, another lesson from Cali: most buyers will only use the asking price as a guideline for making their offer. When an offer comes in, it’s typically 20% under asking. So, how do you sell? Make sure your house is in tip-top shape with wow factor, then put out an asking price at 25% above what you want to receive. If you set it to the market price, you’d just get bids at 20% below that.
If you overprice the market by 25% then watch no one even show up for an open house. People don’t use the asking price for a barometer of a low ball it’s ability and willigness to pay.
Mountain Lakes is nice….I do not see a big problem with using a ‘local’ realtor. Sure, the realtor is pitching you, but then if she was passive, she wouldn’t be selling. Mtn. Lakes is nice….real nice….no you won’t find affordable housing there.
Is our lumber trader still with us?
“CHARLESTON, W.Va. – Global economics and the housing bust are throwing a relentless string of problems at the mom-and-pop sawmills and logging companies that make up much of the nation’s hardwood lumber industry.”
“Large furniture makers have abandoned the U.S., a growing number of raw logs are being shipped overseas for processing, and changing consumer tastes and construction downturns have slashed demand for hardwood flooring, trim and red oak, long the dominant species.”
“Manufacturing is moving away, it’s going to China or whatever, Vietnam, today,” says Virginia Tech professor Urs Buehlmann. “You’re looking at a depressed industry.”
http://www.msnbc.msn.com/id/23959105/
#91 Gary watch yourself your starting to sound like me 3 years ago when I jumped ship on NJ.
Leaving NJ is considered blasphemy.
Its just trailers, fat girls, and rednecks once you cross that state line.
#95 BC Bob
Its funny you say that. My wife wan an interior decorator for Ethan Allen and she thinks the furniture has gone down hill since a lot of it is manufactured oversees.
I’m not sure if they ship the trees there or they get them locally to them but I found it pretty amazing that it isn’t cheaper to cut a tree and make a bed here.
make money:
People don’t use the asking price for a barometer of a low ball it’s ability and willigness to pay.
In my experience, that’s not true, at least for most buyers. I’d agree that for most of the people here, it is, but I’ve met plenty of buyers with very different pricing strategies.
Ultimately, though, there is give and take. Price too high, and no one will take you seriously, absolutely. However, I’ve also witnessed situations where a house can get a higher bid price by raising the asking price, even in a down market.
The house, though, needs to be near market price for it to work. Since the number of contracts has plummeted, and the percentage of contracts closing has dropped, we can be sure that present NJ asking prices are not the market price.
Fact is that not everyone can afford to live in Mountain Lakes, Westfield, Ridgewood…and I hear on the board is people whining about not being able to buy in those towns. Get over it.
hey, i can’t afford garfield, lodi,wallington,or paramoose,
#91 Gary and #96 Mitchelle
I’ll probably be right behind you. Question board, any comments regarding living in Delaware?? Just wondering
How many people here are taking the concepts in the “end of suburbia” video into consideration with regard to housing purchases and planning in general????
city-data.com estimates Mountain Lakes median household income (2005) at $154,000. It also estimates median house/condo values (2005) at $880,400. That represents a value/income ratio of 5.7. The median price for homes available on gsmls.com in Mountain Lakes is $1,175,000, for a value/income ratio of 7.6.
Either home prices are too high, or the rich are trying desperately to get out.
Fact is that not everyone can afford to live in Mountain Lakes, Westfield, Ridgewood…and I hear on the board is people whining about not being able to buy in those towns. Get over it.
I deserve a pony
grim/richnj:CAny one of you guys when you get a chacne give me some color on what has been happening in River Edge (prestigious Bergen Co) over the last few weeks.
Things were quite, but now over the alst few days houses seem to be going UC. I am wondering if this is an early season (nice weather) surge in interest and then it fizzles?
I have to say I am a liitle amazed that there appears to be a fair amount of people ou there who are looking, and in some cases buying, or trying to buy
Have they heard recession etc. Maybe they will not realize ther is a problem until they try to get financing.
Not to sound like gary (no insult brother gary), but it is getting a little frustrating.
I thought we would see some capitulation this Spring, pehaps later in the year.
According to a report unveiled today by MortgageDaily.com, from January 1 to March 31, a total of 14,727 mortgage-related layoffs took place.
At the same time, 343 jobs were created, putting the net job loss for the first quarter of 2008 at 14,384.
That said, mortgage job losses are expected to reach around 57,500 this year, a significant decline from the 86,071 net job losses in 2007.
“While mortgage jobs continue to contract, we’ve seen the pace of layoffs slow recently,” said MortgageDaily.com founder and Publisher Sam Garcia. “This trend is likely to continue.”
California saw the worst of it, with 4,470 net job losses, followed by Florida with 1,539 losses, New Jersey with 684 losses, Iowa with 415, and Indiana with 294.
http://www.thetruthaboutmortgage.com/14000-mortgage-layoffs-in-first-quarter/
NJ can’t possibly be the second leading state in job losses in any sector. We are sooo close to NYC.
River Edge SFH, Condo, Coop, TH (NJMLS Stats)
YTD (1/1 – 3/31) Sales
2003 – 26 (Median $382,000)
2004 – 19 (Median $398,500)
2005 – 20 (Median $451,000)
2006 – 26 (Median $491,000)
2007 – 26 (Median $512,500)
2008 – 15 (Median $460,000)
YTD (1/1 – 3/31) Contracts
2003 – 34
2004 – 28
2005 – 24 (Average List $494,392)
2006 – 25 (Average List $538,172)
2007 – 40 (Average List $541,397)
2008 – 21 (Average List $498,214)
Sale/List ratio in the most recent period was .89
Monday April 7, 7:14 am ET
By Linda A. Johnson, AP Business Writer
TRENTON, N.J. (AP) — In an effort to more closely align its corporate identity with core strategy and current business practices, the Board of Directors of Schering-Plough met over the weekend to decide on the merits of a change in the name of the Corporation. Going forward, the company will now be know in the public domain as “Schering-New Jersey Jobs”.
Actually it makes perfect sense to me. Certain towns I will fail to mention use snooty realtors like Daniel Gale and start them as 30 day exclusives and then move the left over MLS. The realtors are rich good looking wives of residents of the town. If a town lets its inventory out on MLS you can’t control who buys the house, in reality you are not buying a house or a street or a school, you are buying neighbors. The snooty smart towns know subprime sludge brings bankruptcies and queens/brooklyn people bring b-ball hoops in the street and clothes lines on the front lawn. My sisters snooty neighborhood which will go unnamed first offers trade up houses and better houses to existing residents in good standing. My sister bought a pos house on the wrong side of town and after ten years she earned the right to be on the right side of town, she sold her starter to some Queens type couple and if they do the right thing they can be there too. The subprime issue was the 1.5 million dollar homes were traditionally protected by the 25% down and the banks strict financing standards, once you went to nothing down and 2/28 teasers the sludge could skip the entry phase and bring the the newark walk up tenantment crowd to upper saddle river with a few swipes of a no doc loan. The towns needed to protect themselves. The truth is you should not want to buy at a large prem in a town that lets any old realtor from any old place move in. If homeless smelly men starting driving rolls royces I am sure their values will fall in price. A rich neighborhood is largely based on illusion. A house is a house. As long as the doctors and stockbrokers live there it is exclusive.
“i suggest you drop that realtor and use one of us that know the area. the mountain lakes community is real small and everyone knows everyone else and you will be better off using me. i know when the mountain lakers want to sell their home before it hits the market and your realtor will not have that kind of information.”
That is the craziest statistic I ever saw in my life. The average person who lived in Mountain late in 2005 bought their house pre 2000 for most likely $400,000. That would be easy to swing on $154K.
The average buyer of Mountain Lakes homes in 2005 income was most likely way higher than $154K
IVV Says:
April 7th, 2008 at 1:27 pm
city-data.com estimates Mountain Lakes median household income (2005) at $154,000. It also estimates median house/condo values (2005) at $880,400. That represents a value/income ratio of 5.7. The median price for homes available on gsmls.com in Mountain Lakes is $1,175,000, for a value/income ratio of 7.6.
Either home prices are too high, or the rich are trying desperately to get out.
3B (105),
I see Grim got back to you at 107.
Additional stats I pulled
River Edge Q1
Year Sold U/C Act %SalePrice/ListPrice
2008 15 21 67 89.1
2007 26 40 58 92.7
2006 26 25 30 95.5
2005 20 24 26 98.3
SO i may have an unique opportunity at a property on plainfield ave about 1 block from the train station. I dont really know how to value the home, a 1950’s cape 3 bdrm 1.5 bath, basically nothing have ever been updated. HVAC windows, electric are all original . Zillow calls it at about 150K ( no i do not go by zillow). The house is still owner by the original owner who is very elderly and may be looking to pass it to someone they know and like. I am trying to get an idea of if i should even bother pursuing this. Any suggestions as how to value and approach this? Realistically i would probably have to gut the house and this area isnt my ideal location for a home. Just wanted to bounce this off of the overwhelming intellects of NJRER
that was in edison
Just made a $355,000 offer on a $400,000 house in West Essex…
Dippin’ in the pool……
Given that the average home in RE is selling for 11% off the list price, can a 20% off offer even be considered a lowball anymore?
Seems more like a starting point to me.
Our agent cautioned us against bidding 20% off saying “houses are not selling for 20% off”
John,
interesting take on a mountain lakes type town…almost all of the folks that were looking at these open houses were ‘neighbors’ – the reason i know this? they all knew each other – it was like a party getting started when someone walked through the front door. and most walked there (there was no other car in the driveway!)
if they offer these homes to their own first then why are these homes on the market for 3+ months? do the neighbors not want these homes? also, i dont know if i want my kids growing up with parents like that for neighbors – but thats just me i guess….
ChiFi:
I would figure that your 10% jingle mail number is about right. I base this on the belief that people who were stupid enough to purchase homes without determining if they could afford them will probably behave with a similar level of ignorance when it comes to making the prudent move of just walking away.
Of course, if the unemployment numbers kick up and the recession is deep, I would adjust my numbers higher as the ability to avoid foreclosure for many will evaporate.
And for those keeping track at home. Oil is above $109 and gasoline just hit another record high. Gold is at $924. Goldman is already leveraging back up and Wamu, like Lehman and UBS, needed a cash infusion. Of course, the market continues to rally.
Can’t believe how few people are driving. Sunday nights on the GSP have been lighter than I can ever remember.
“queens/brooklyn people bring b-ball hoops in the street”
actually this is funny– one reason I am reluctant to move to a snobby neighborhood is because I don’t what to get sh*t for putting up a basketball hoop
CAIBC,
Was at an open house in Morris Twp a few weeks back. We ran into a neighbor on the way out. Very nice guy, we chatted for a good 15 minutes. He did a better job of selling the house than the listing agent did.
Neighbors always snoop at open houses.
The ones that snoop also like to gossip, so strike up a conversation.
104.Hilarous.
Yes indeed…we ALL want that pony.
Dammit.
#110
“The average person who lived in Mountain late in 2005 bought their house pre 2000 for most likely $400,000. That would be easy to swing on $154K.
The average buyer of Mountain Lakes homes in 2005 income was most likely way higher than $154K”
another thing I have a problem with– getting the snob treatment from long term residents of these neighborhoods, many of whom make substantially less than the new people moving in.
Essex,
So, when are you buying?
I don’t what to get sh*t for putting up a basketball hoop
Can you even attach one of these to a McMansion? I’d be afraid of tearing the styrofoam siding off. Even if you got it up, the ball would leave a dent in the EIFS every time your kid missed the hoop.
BC,
The answer is a resounding no 2
Hitting a home run, delivering that signed contract to a successful closing?
I am in the midst of the worst possible walk away at the last minute I have experienced. The buyers are in breach, big time.
KL
Our agent cautioned us against bidding 20% off saying “houses are not selling for 20% off”
Which explains why houses are not selling.
Your agent should be cautioning the sellers at this point.
Skep,
We put ours right out there on the sidewalk, and only bring it it back in the yard when we get too many car alarms going off at once (-:
KL
125…Ball and Chain obtained already Gary….2002.
DINJ,
Two years ago 10% off would have been considered an insulting lowball.
#75: Heh. “stainless steal appliances. Owner may be N.J. Real Estate agent, but Owner can’t spell worth s***.
Our agent cautioned us against bidding 20% off saying “houses are not selling for 20% off”
Here is the NJREREPORT response “yes your are right they aren’t selling well at 20% off,I’ll try 30% off. That’s what it’ll be worth in a year or 2 anyway.
That should really get them going!
Jill maybe its a play on words.
#126
“Can you even attach one of these to a McMansion? I’d be afraid of tearing the styrofoam siding off.”
maybe a better idea would be to hook a hoop onto the home depot chandilier in the cavernous lobby. teach them not to rely on the backboard
You mean the racquetball court?
From Bloomberg:
Fed’s Rosengren Calls Delay in Housing Recovery a `Surprise’
Boston Federal Reserve Bank President Eric Rosengren said the delay in a rebound of U.S. home sales continues to “surprise.”
“People have been expecting a recovery in housing much sooner than it has occurred and that’s continued to surprise on the downside,” Rosengren said in a telephone interview with Bloomberg News.
Rosengren said it’s “confounding” that housing shows little sign of recovery after the Fed’s six interest-rate reductions since September. Fed officials are in the eighth month of a credit crisis that began with rising delinquencies on subprime mortgages.
“The housing market is still weaker than we would like and that has contributed to some of the financial problems as well,” Rosengren said.
The U.S. economy grew at an annual pace of 0.6 percent from October to December. Growth probably slowed to a 0.2 percent annual rate in the first quarter, according to the median estimate of analysts surveyed by Bloomberg News.
“The economy definitely has been weaker than we would have hoped,” Rosengren said in today’s interview. “That’s one reason why monetary policy has moved so aggressively.”
Rosengren also said he plans to discuss how to help repair the mortgage crisis in a future speech. He wasn’t specific on when he might deliver such a speech.
“Rosengren said it’s “confounding” that housing shows little sign of recovery after the Fed’s six interest-rate reductions since September.”
Clueless.
ChiFi (63)-
Katy bar the door. Because, IMO, the stigma’s been removed.
And, the consequences of bad decisions…
SG (69)-
Old trick.
Thanks Rich and Grim for the information.
Seeing the numbers presented as such shows there has been a real decline in prices in RE. And y yes 11% off list price does not make 20% off look unrealistic.
Am I right in assuming that a few went UC in the last few days, or were they perhaps expired listings?
SG (76)-
He should rename that blog “DOA”.
#114: How much updating work can you do yourself? That’s a consideration for you.
We moved into an original owner house in 1996, and 11 years later, we’ve replaced the furnace, water heater, electrical panel, added outlets, ceiling fans, dedicated circuits for fridge and microwave (previous owner had fridge on a 3-prong adapter in a 2-prong outlet), siding, windows, roof, driveway, basement family room carpet. We’ve stripped wallpaper, painted, had new toilet and vanity and flooring put into upstairs bathroom. I’d say we’ve probably spent about $60K all told, and we STILL couldn’t sell it in its current condition.
The outside is great, but we still have to finish doing minor updates in the kitchen (reface lower cabinets, new countertop, new floor, remove wall oven cabinet and replace cooktop with range), gut and redo the 1st floor bath, add a deck, and tear up the carpet and refinish the floors.
On the plus side, we have ZERO home equity debt, just the mortgage @ 4.75% with 11 years to go.
If you can do a lot of the updating yourself, and/or if you’re planning to stay for a LONG time, and/or if you can get the house for a song and you have a bunch of cash left over and can have this work done before you move in, then maybe you consider it.
But as the mother of a friend of mine said when she saw our house the day we closed on it, “You are going to be working on this house till the day you die.”
Jill,
Are you living in my house?
118 DINJ
Your agent is probably trying to tell you that there is a small chance you will get the house by bidding 20% off. The data still shows (at least from the data back in Jan that grim posted) that there are very very few houses that sold for more than 15% off current list (original list price is another story!).
It doesn’t mean you shouldn’t bid 20% off if that’s what you think the house is really worth, but it doesn’t mean that you should just go around randomly putting in 20% off offers either. List prices are all over right now. Some houses are priced just right, some are 20% too high, some are in the middle.
CAIBC (87)-
I’m sure I can introduce you to one person in every town in America that’s make you think twice about living there.
Who the hell cares? Are you so neurotic as to let the behavior of one pushy Realtor cloud such an important decision?
Buy a damn house there without her, then get the pleasure of flipping her off every time you see her.
If walking away will become a norm – will banks stop lending money or will they just reqire 50% downpayment and what will it do to the market?
I think just making 20% mandatory would be as big a problem and make the market worse.
Joey (147)-
You should see the people who I see that can’t cough up 3% for FHA (and the 3% comes back as a seller concession).
Nothing wrong with a fixer-upper, even if it takes years to get it complete.
I’d much prefer an older home that hasn’t been updated. I’m kind of picky when it comes to fixtures and finishes, so I’d most likely be replacing everything anyway.
Not to mention the DIY/hack-job nightmare projects that have been spawned by HGTV.
I’m glad you installed nine hundred dollars worth of tile on this floor, but didn’t you think it might have been a good idea to replace the rotting subfloor and made sure the floor was level before you tiled? Doh!
Joey:
Absolutely. If higher down payments become required, then house prices will need to drop to let the person who has saved some money turn that “some money” into “20%/50%”.
Al (93)-
“I don’t want to live in town were there is organized realtor’s MOB…”
According to many here, the list of places where this is the case is, roughly, everywhere in the United States.
Do you now want to move to Guatemala?
Excuse me, I have to go.
Late for a meeting of the Realtor’s cabal.
what would be the best source for recent sales to compare to the house in edison, and in such a crazy market are there any general guidlines o be followed for valuation?
#113 Rich: 2008 15 21 67 89.1
Sorry to be a pest but what does the 67 # reflect?
Your hearing, I hope?
Let me know if it plays out anything like the “witch” scene from Monty Python.
I’m in California this week on business, and if you think NJ has a lot of McMansions…Ca has McTowns.
Makes me appreciate the classic victorians and older colonials we have in the Northeast.
Taxes are currently about 3000 on this 1400 sqft houose. is there any way to approximate what effect and extensive upgrade to the house would have tax wise?
3b,
Actives
[156]
NJ: POS Cape, $425k
CA: POS Bungalow, $850k
3B (154)
67 is the number of SFH, Condo, Co-op & Twnhs currently active (available for sale)
apo,
Look up the tax records on a similar house in the neighborhood. Helps if the home has undergone similar renovations (legally).
DINJ
They’ll probably come back with an asking of $395. If they do it means they’ll be interested but they’re going to want you come up signifigantly in your offer.
significantly
Sybarite:
Yeah, it was a real shock to me when I first saw it… Much better architectural details back east, but they newness of the McTowns tended to have more efficient floorplans for present-day uses.
The big difference between CA McTowns and NJ McMansions was that there were developments in which you could find ca.
grim
how do i tell if a home has undergone renovations? can that be done by looking at just tax records?
Ann #145
I think what she was saying was that the houses in this neighborhood are not selling at 20% off, which is why we rethought it and put in a bid at 11% off. I believe they would have flatly rejected the 20% off offer. I have a feeling these sellers don’t HAVE to move.
Grim #131 I agree. What a difference 2 years makes!!
can anyone tell me when edison was last assessed?
thank you for all of the help!
er…
I meant to say…
The big difference between CA McTowns and NJ McMansions was that there were developments in which you could find small homes on smaller lots at lower prices. Okay, comparatively lower prices once you get outside the big metro areas.
But for the $850K POS bungalow, you got tile roofs and stucco. See? It’s a feature worth something. Mm-hmm.
From MarketWatch:
U.S. Feb. nonrevolving credit rises $497 million, or 0.4%
U.S. Feb. revolving credit rises $4.7 billion, or 6% rate
U.S. Feb. consumer credit rises $5.2 billion, or 2.4% rate
But this time they’re not buing $300 jeans, they’re buying groceries and paying utilities
#160 Rich/grim; Thanks Guys I should have known that. What a difference 2 years make, but still more room to decline. I shall continue to sit tight. Thanks again
Every negotiation is different.
Some sellers don’t like negotiation, others expect the dance. Some want to move in numerous small increments, others just want to get it done. Some sellers are willing to negotiate, some aren’t. Some sellers are in love with their home, others aren’t. Some need to leave, others don’t. For some sellers the negotiation is an ego game that they need to “win”, for others it’s simply a transaction.
Why bother trying to make assumptions before even presenting an offer?
You should see the people who I see that can’t cough up 3% for FHA (and the 3% comes back as a seller concession).
I have friends that bought in 2006 with no money down. Got in at the last second :)
#148 clot: Are these type of deals still common?
Reasking….
Question: what is a “notice of settlement” in regards to a mortgage? Why & when would that be used?
TY!
Nothing wrong with a fixer-upper, even if it takes years to get it complete.
I’d much prefer an older home that hasn’t been updated. I’m kind of picky when it comes to fixtures and finishes, so I’d most likely be replacing everything anyway.
I agree. We’ll be in the market for a fixer as that’s mostly our price range. I’ll be doing most of the work so being picky is a must. Nothing wrong with getting your hands dirty.
A co-worker of my wife and husband just had a house built because they don’t know how to do anything and they don’t want to have to do any work in the house. So they spent $600,000 to have a house built from the ground up. I hear all the time that the wife is nervous about “the expensive investment” they made…
zillow suggests that this house in edison is worth 150K, local houses with similar specs ( but i suspect at least somewhat updated) are listing at anywhere from 300K to 380K. Does anyone have feel for homes in the area similar to this
http://www.weichert.com/search/realestate/PropertyListing.aspx?P=19174199&src=Trulia&seg=NJ&keyword=Edison
i
but even more dated are going for? This would be a family transaction and would most likely consist of a reduced price, but would still need to be fair to avoid family issues
Houses really are beginning to sell at a discount, I just went under contract, the home next door which is almost identical was sold 18 months ago for 20% more than I am paying.
3b (173)-
Common? FHA is making a huge comeback. Remember, the loan limits are the same as Fannie/Freddie for most of NJ. They top out at 1.403 mil for a 4-family (I still hallucinate when I think of this number, then think “FHA”). Even better, credit requirements are looser than Fannie/Freddie, though not by a lot.
Old-timer underwriters refer to FHA as “subprime, original-style”…
Funny think about organized MOBs, my friend bought a house once and the seller priced it to give back the whole 6% he saved by not using the realtor and then knocked a little more off. Reason why he was told post contact was she wanted to control who bought the house. She was best friends with the neighbors on both sides and was only using a mile away. Realtor was told if he took listing if a ax murder was the highest bidder he would yell sold. Realtors by law cannot decide “who gets the house”.
D (174)-
It’s a preannouncement of a closing for legal purposes. It means anyone with a claim of lien on the subject property better get it the hell filed. :)
hello all,
could someone supply the address and details of this njmls# 2735426
thanks
Apoc. 176 – Lot’s of beautiful wallpaper in that one.
166 DINJ
Yeah, 20% is a lot.
Good luck with it! Hope you get it.
Clot (180), thank you!
Could be a foreclosure or short sale? I’ve never seen it before & it seemed odd. There’s a property I’ve watched that disappeared from the MLS & now has the notice of settlement on the Morris Cty mortgage records. I was trying to figure out what was happening (& I know the ARM reset).
or, Clot, could it be a bankruptcy?
Clot,
How was the sales rally?
spyder
$1,490,000 #: 2735426
Addr: 172 KNICKERBOCKER RD RES/A
Orig LP: $1,590,000 LSP:
DOM: 221
KL
thank you rhymingrealtor
#178 clot: Perhaps that will explode too?
From Reuters:
Some US banks face failure as credit problems mount-RBC
During the next two to three years, U.S. bank failures will likely increase dramatically from the low levels recorded from 2004 to 2007, as credit problems mount for the industry, a RBC Capital Markets analyst said.
“We anticipate upwards to 150 banks will fail over the next two years. Banks that deplete their capital through rising credit losses are most vulnerable to failure,” Gerard Cassidy said.
He said credit problems at U.S. banks are expected to worsen throughout the year from existing levels and are unlikely to peak until sometime next year, also noting that widespread housing deflation will put further pressure on the economy.
“As we move deeper into 2008, we expect to see economic growth grind to a halt with recessionary pressures mounting as the year progresses,” Cassidy said, recommending investors “underweight” the bank sector.
D (184)-
Foreclosure, no. Bankruptcy, no. Short sale, maybe (after all, it IS a sale).
Paid family leave is a go.
With an important change..
It now gives small-business owners the right to fire and replace an employee who takes family leave if the company says it cannot operate without a key position filled.
HE (186)-
I think the rally is in the next couple of weeks. I’ve actually thought of attending, but my fear of getting brainwashed is causing me to hesitate.
I keep seeing myself turning into one of those “dark-seekers” from I Am Legend.
3b (189)-
I think the question may be, “when will it explode”?
However, recent-vintage borrowers who can get through the new procto-exam look a lot better to me than the subprime peanut gallery of ’05-’07
Ya know, i had Devils Rangers tickets for Prudential Center this friday in the cusp of my hand. The only downfall is it’s me and the wife’s 10th anniversary. We don’t actually have anything planned and i could have bought the tickets. I didn’t but had to “text message’ her as she’s a teacher and has it turned off. Well, i get a text back with
“YES, get them!!”
They are now sold out…grrrr.
Just venting.
It now gives small-business owners the right to fire and replace an employee who takes family leave if the company says it cannot operate without a key position filled.
Okay….. so what company is not going to do that???
Excuse my ignorance but why does NJ need its own bill, is the federal family leave act enough or does NJ’s cover companies that have fewer than 50 employees?
Thanks
KL
#117 grim; Especially given River Edge has the 3rd highest property taxes in Bergen County.
127 kl
“I am in the midst of the worst possible walk away at the last minute I have experienced. The buyers are in breach, big time.”
…would I guess correctly that the sellers don’t have a lot of loose cash available to initiate a lawsuit?
Question for everyone
How much do you think a teardown costs in a nice town North Jersey?
NJpatient,
Sellers are not in a bind, buyers have terrible representation by both their agent and attorney. Has to be the worst attorney I have ever had any dealing with, although the one who had a vicious dog in his home/office with boxes for furniture and dog urine and hair all over is right up there. Now that was an experience.
KL
kl (201)-
“…although the one who had a vicious dog in his home/office with boxes for furniture and dog urine and hair all over is right up there.”
How could you tell the attorney and the dog apart?
Sorry…couldn’t resist.
Maybe the dog was part of his personal marketing campaign?
“I’m a pit bull when it comes to your interests.”
#204 – CLOT
ROFL!!
clot:
the f— if I know how the market will react, but those AA #’s s#cked a%%…..you better have tight stops tough guy…….Chip Ledger of commodity longs
202 clot
too easy, isn’t it?
Next GTG, we’ll have to share some lawyer jokes.
Patient,
go easy on the lawyer jokes. But then, I always need new material.
So here goes. Just offered on a 4bed/3ba split in Summit that I had thought little of until I saw it. Felt it was priced right (low end of comps for area) and in a part of town that should hold value (cul de sac with several larger houses nearby). It got six bids though, so I am not holding my breath.
Grim, you would love it as nothing had been done for years except the kitchen, and that wasn’t so great. Bedrooms carpeting that hurt my eyes, and a seriously butt-ugly 4th bedroom but I thought that with one dormer, it would make a kicking master suite and I don’t even need that room right now. And I can do the demo, inside framing and drywall myself.
And if I do live there, I am buying a beater car, just to p-off the snobs.
ChiFi (206)-
Tight stops, always. Never know when somebody can rain on your commodities parade.
Patient (207)-
BP fastball, right down the pipe. :)
[190] Grim,
Cassidy is a well-respected bank analyst but I am not sure it is right to compare the current environment to 1990. The regulatory landscape is completely different. Further, I am not sure I buy 150 bank failures. There are a lot fewer institutions than there were in 1990, and they are not nearly as exposed as they were then.
Problem though, like picking merger targets, is that you never know which one will pop.
Clotpoll Says:
April 7th, 2008 at 5:18 pm
Patient (207)-
BP fastball, right down the pipe. :)
All Delgado is doing with that is driving down the left field line…….
Going to Opening Day tomorrow courtesy Matt from SNY….
OT….disturbing story of the weekend…
Linda and I were with Hunter at a friend’s house. These people have 4 kids: girl-age 6, boy-4 and twin girls-2. Anyway, the boy is playing with his friend Lorenzo-3 when his older sister excuses herself to go to the bathroom. While she is in the bathroom, Lorenzo turns to my friend’s son and says “…aren’t you going to sneak a peak?”
Looks like AA came back….must have been comments on the earnings CC…..
Clot 202-204 LOL
Chi
You now have a baby but you will soon see your son will have one of “those” friends, my oldest son has A “Dominick” my nephew has an”Anthony” These are the friends your son wil have that will amuse you -infuriate you- and the one you will peg as most likely end up in jail.
KL
apocalypse boy,
Terry Cullen of the WSJ wrote a “Fiscally Fit” column on 2/1/07 in which she said:
We were notified this month that our home is being reassessed as a part of a townwide revaluation.
She lives in Edison.
Call town hall and find out where they are with that.
Dear Sellers,
Take a look at this chart: https://njrereport.com/images/mar08_salesinv.gif
Get it?
aocalypse boy,
She also said the last re-eval was in 1991.
chicagofinance Says:
April 7th, 2008 at 11:28 am
“CB: We are in uncharted territory…..I don’t think any outcome is on or off the table. Honestly, I think the real concern is the potential of removing the stigma of “walking away”. If it becomes socially acceptable, the action will snowball….”
The stigma is definitely off. The “crisis” can be seen as absolving the walker of personal responsibility, and of course there is safety in numbers.
From the WSJ:
Home Loan Banks End Talks
By JAMES R. HAGERTY and DAMIAN PALETTA
April 7, 2008 4:04 p.m.
The Federal Home Loan Banks of Dallas and Chicago called off their merger talks amid uncertainty over the value of the Chicago bank’s holdings of mortgage securities.
The two banks said they were unable to agree on terms but declined to elaborate. The Chicago bank also announced that its president and chief executive officer, Mike Thomas, is stepping down effective Friday. While the bank searches for a successor, Matthew Feldman, currently an executive vice president, will serve as acting president.
The failure of the merger talks, which were announced in August, is the latest sign of the strains on financial institutions resulting from turmoil in the mortgage market, where rising defaults and falling home prices have slashed the market value of home loans. The nation’s 12 regional home loan banks have stepped up their lending to commercial banks and thrifts as other sources of funding have dried up.
But the Chicago home-loan bank faces losses that may call into question the adequacy of its capital base, which stood at 4.9% of assets at the end of 2007. Unlike its Dallas counterpart, the Chicago bank aggressively expanded its purchases of home mortgages in the first half of this decade. Regulators criticized the Chicago bank’s risk controls in 2004 and since then have imposed tighter restrictions on the bank.
The Chicago bank has said it expects to report a loss for the first quarter of 2008, and that “losses will continue for some period of time.” Those losses are due partly to the falling value of derivative contracts used to hedge against interest-rate risks. The long-term mortgages the bank purchases are funded by shorter-term borrowings, whose cost has risen.
For 2007, the bank reported net income of $98 million, down 49% from a year earlier.
At the end of 2007, the Chicago bank held $4.77 billion of mortgage securities issued by Wall Street firms or other private-sector entities. Nearly half of the homes serving as collateral for those securities are in California and Florida, where home prices have fallen rapidly. The market value of such mortgage securities has dropped sharply over the past year.
kettle1 Says:
April 7th, 2008 at 1:23 pm
‘How many people here are taking the concepts in the “end of suburbia” video into consideration with regard to housing purchases and planning in general????”
Didn’t watch the video but I have come to hate suburbia and think it has no future (and am somewhat glad). I like the city and will probably keep to rural/village.
3b Says:
April 7th, 2008 at 1:31 pm
“Things were quite, but now over the alst few days houses seem to be going UC. I am wondering if this is an early season (nice weather) surge in interest and then it fizzles?
I have to say I am a liitle amazed that there appears to be a fair amount of people ou there who are looking, and in some cases buying, or trying to buy”
Is it really so surprising? To some people the current drops are seen as a really good deal. We knew there would be some kind of dead cat bounce.
216
The blue line is going up!
Did anyone see this “heartbreaking” story about a family about to lose their home this morning on the early show? It is almost funny because the people don’t have any idea that they are to blame for buying a $1.4M home with interest only payments.
Dear Sellers,
https://njrereport.com/images/mar08_mon.gif
Any questions?
Dear Realtors,
https://njrereport.com/images/mar08_salespace.gif
Oh, and by the way, the BMW payment is late as of today. I mean, (snort….) you wouldn’t want anything to happen… where, g*d forbid, the car got repo’d or something… (chuckle…). I mean.. hey, we all know appearances are everything, right? Just sayin’.
Hmm, something not right about this upgrade..
i love when the pull up in the 4 door bmw
and get out with the painted lipstck.
can they really make the payment?
plus they all say business great and hurry
Power of positive thinking
ChiFi (213)-
AA to me, has never been a buy at any time, because they’re always the first company to report the quarter.
So many people read hopes and expectaions into them that they’ve become a proxy for hope and expectation.
And, for the past quarter, there are gonna be a lot of disappointing reports. I’m looking for the S&P to start cratering toward 1270 again. I got no stops in on SDS.
All disclaimers. My rotisserie life is hinging on Delgado producing big-time. Only an injury can allow me to get off him and pick up another 1B.
Thanks to this site I was about to go in this year an buy but it looks like I will get in about 3 years from now. I think as long as it took for home prices to go up will be the same to go down, at least half that long to go down.
kl (214)-
“…you will soon see your son will have one of “those” friends, my oldest son has A “Dominick” my nephew has an ”Anthony”
D’ya think Dennis Kozlowski was a “Dominick” or “Anthony”? It’s the straight arrows who get bent that are the most intriguing…and, the scariest.
#230 I think as long as it took for home prices to go up will be the same to go down, at least half that long to go down.
I don’t think it will take that long;we are in a recession.
grim/ Richnj: If one of you guys get a chance can you please check the sales price on 725 Center Ave in River Edge. Thanks.
grim (219)-
That is just a chilling piece of news. I’ve been away from the TV; are the talking heads going nuts over this?
This seems- to me- to be one of the top five news events of this whole debacle. Two banks of this strategic importance…eyeballing each other like two gangsters in an alley?
OMFG. It’s all about to go to black.
soosh (221)-
Sales aren’t going to 0. There will always be activity.
One always has to separate the anecdata from the larger picture. And, the larger picture tells us we’ve still got a very sick market on our hands…with no real catalyst for improvement in sight.
#221: lisoosh: Correct. Just getting a little restless.
Re: comments 69 & 71. The discussion groups are easy enough to set up, and we tried them on a few of our single-property home listing sites. There wasn’t much legitimate discussion, though, just trolling.
Buyers seem to find the sites very helpful. We get a lot of comments on them at our open houses. I think people get tired of the little pictures they see on so many real estate web sites.
There wasn’t much legitimate discussion, though, just trolling.
As could be expected. Discussion boards don’t have a place in this context.
No one who was interested in the house would dare post a positive comment, for fear of attracting competitors.
Therefore, at best you’ll get nothing but a stream negative comments. Unhappy ‘customers’ are much more likely to go online and rant about a bad experience.
The real benefit of a dedicated site is having the real estate (no pun intended) for larger pictures and a verbose description.
(237)-
You should invite Gary to comment on some of your listings…
I think some institute should certify Gary as being the only human on Earth who can smell cabbage through the internet.
Or, that institute should just certify Gary, period.
* James Doran in New York
* The Observer,
* Sunday April 6 2008
* Article history
About this article
Close
This article appeared in the Observer on Sunday April 06 2008 on p1 of the Business news & features section. It was last updated at 00:04 on April 06 2008.
Fears are mounting that Wall Street banks are relying too heavily on tens of billions of dollars in loans made available by the US Federal Reserve. Their borrowing levels have rocketed by almost 200 per cent to $38bn (£19bn) a day in just three weeks.
The latest loan data released by the Fed shows that Wall Street banks and investment firms borrowed an average of $38.4bn every day last week, a big jump from the $32.9bn borrowed the week before, but almost three times the $13.4bn borrowed when the emergency scheme was launched on 17 March.
# 221 Also you have to admit this blog is more bearish than average buyer.
For what it’s worth i think now is the time to look for deals.
Layoffs left and right, fifth largest IB bankrupt, largest morgrage originator almost bankrupt, hundreds of billions of losses, worst credit crunch in decades, personal credit very tight, press super negative on RE, energy prices at record highs.
How long this is going to last? I dont suggest you buy at 06 prices but how much more leverage does a buyer get barring a complete armageddon.
just my 2 cents. for the record i am not in the market.
Just reread my post.. don’t think prices are goin up so no rush until you find what works for you. Just don’t see the point in waiting more.
# 103 “Question board, any comments regarding living in Delaware??”
Beaches are not as good, even more exposure to chemical plant fumes, expensive toll road, easy access to Maryland’s crabs.
For you familiar w/ munis, a question…
For a NYC worker living in NJ, which muni bond gives you the most tax free income a NY state bond or a NJ bond?
Logic would be that since I’m a NJ resident a NJ bond, but working it out rationally, my state income tax on income taxes is paid to NY and I get a credit on my NJ taxes for taxes paid to NY when I file NJ income taxes, so that leads me to believe NY. I’ve never bought a muni before so I don’t know for sure. Now that savings accounts are not paying 5% like they used to, looking for other alternatives now that I have CD’s maturing.
# 118 “Our agent cautioned us against bidding 20% off saying “houses are not selling for 20% off””
It seems that the agent has forgotten that the agent’s job is to bring to the seller your offer. They don’t set the acceptability of an offer.
tol,
Why wait?
To build up a larger down payment? To pay down debt? To raise credit?
Waiting for a particular style of home? Or a home in a particular location?
Lots of reasons to wait, especially now that there isn’t any urgency to jump into the market.
In 2005, people were buying homes they didn’t want in locations they didn’t like, because they were afraid that was all they’d ever get.
Buyers, enjoy it.
Re 225 – The answer is Puerto Rico!!! Tax exempt in NJ and NY and an equivalent triple AAA PR bond earns a few BPs higher than NY and NJ.
Buy either a closed end muni with a big discount that is rated good, see Mondays WSJ or go trolling at a big broker dealer like Fidelity or Smith Barney that has a lot of inventory or open an account at bonds on-line and buy munis in the secondary market. Min amount is 5k per bond and some bonds have 10 or even 25K plus mins, I looked today and a 2010 NY/NJ/Pr bond best yield is around 3.3% tax free.
Bonds prices are part of NASD Trace system and prices are easy to track.
PUERTO RICO ELEC PWR AUTH ELEC REV PWR 05.25000% 07/01/2013 REV REF BDS SER. 2004 Price (Ask) 107.052
Yield to Worst (Ask) 3.750%
NEW JERSEY SPORTS & EXPOSITION AUTH ST 05.00000% 03/01/2011 CONTRACT ST CONTRACT BDS SER. 2000 C
Basic Analytics
Price (Ask) 105.498
Yield to Worst (Ask) 3.000%
NEW YORK N Y G.O.BDS SER. 2003 B 05.50000% 08/01/2012
Basic Analytics
Price (Ask) 109.817
Yield to Worst (Ask) 3.050%
Yield of Municipal
Bond Fund = Your taxable-equivalent yield
1.00 – your federal
income tax rate
Is a Municipal Bond Fund for You?
Your federal income
tax bracket Is a municipal bond
fund appropriate?
15% Unlikely
25% Likely
28% Very likely
33% Highly likely
35% Highly likely
hello all,
could someone supply the address and details of this njmls# 2810528
thanks
CAPITAL ONE FINL CORP 6.15000% 09/01/2016 SUB NT
Basic Analytics
Price (Ask) 88.697
Yield to Worst (Ask) 8.026%
here is a good manly investment grade bond for us who believe in free market and our great banking system!!
Dozens of dead animals found in Barnegat home
Cruel; all because they couldn’t afford their mortgage.
-R
John,
Thanks. After seeing your reply, I ran the screener in Fidelity and came up w/ the exact same issue. Never would have expected the answer to be PR. Puerto Rico – ohhh-oh.
Now to decide if I even want to stay in USD denominated assets…
victor,
102 Whitmore
Listing says the property is REO, bank owned. Tax records show a prior sale on 1/23/2003 for $307,000.
Can anyone dial me up some info on MLS#20810148.
Thanks very much.
Grim,
Those are personal reasons. I dont think we’re saying different things. My point is that for those who are ready waiting may not necessarily prove best strategy. This was inspired by posts along “i was ready to go, but after reading this blog will not buy until 20xx.”
It is a horrible time to sell so it must be at least ok time to buy, no? The urgency is gone for a long time no question.
If you are in Fidelity go to the junk bond section and check out Ford and GMAC, I doubt they are going out of business in the next three years and yields are sky high plus they let you buy in 1K demons, also CIT on the investment grade front is paying 10% and go under CDs and you will see their is a secondary market for cds which gets you 50bps more. Also go under research stock and click perfereds lots of high yields there. Finally, not many people know this buyt Israel bonds are also tax free. There is a muni calc in Fideltiy and 3.75% tax free is pretty good.
I was a bank bond buying machine for a few months and then a muni bond buying machine. I am running out of ideas on the fixed income front myself. But bottom line anyone is nuts to buy a taxable 2.75 four year ING CD when you can get 3.75 tax free in the muni world.
Clotpoll (235)
The talking heads are too busy trying to find glimmers of good news in the river of bad news coming out of Wall Street and the economy in general. Besides, the Fed will step in and rescue all bankers from their own stupidity every time. It hath been foretold.
I went to see a house 2 years ago almost exactly it was april 06, it was listed at 309,000 it had been reduced from 349,000 this was an attached house it was the last one in a row so it was attached on one side only. I know I have stated I like row houses, I like blocks with row houses… anyway I even went as far as to take my husband with me. We both liked it alot, open floor plan new hardwood floors throughout, sections of brick showing nice kitchen full basement new bath w/jacuzzi skylights full high dry basement.
Anyway although we liked it, there was no way I was buying, too high. It closed in june of 06 for the 309,000 asking, which I did’nt think would happen, so I questioned myself on the market again. I thought there was no way it would sell at that price. I was wrong, or was I too early with that thought. That house went on the market today for $219,000 of coures subject to third party approval. I would have posted this earlier except at my age it takes a long time to get off the floor when I fall off my chair.
KL
Thank you, Grim
scribe Says:
April 7th, 2008 at 7:02 pm
apocalypse boy, Terry Cullen of the WSJ wrote a “Fiscally Fit” column on 2/1/07 in which she said: We were notified this month that our home is being reassessed as a part of a townwide revaluation. She lives in Edison. Call town hall and find out where they are with that.
s: If you know for a fact she lives in Edison…fine…but I remember piecing together a bunch of facts in her columns about a year ago, and backed into the opinion that she lives in or very near the Oak Hill section of Middletown (i.e. area north of the Navesink River and east of 35). I think the clincher is that there is no Whole Foods anywhere near Edison.
Middletown is also well into its reval….
Gary,
Can I get a booyaah?
71 Primrose Lane, Closter (aka Upper Haughtyville) NJ
Purchased: 12/19/2006
Purchase Price: $580,000
MLS# 2800974
Original List Price: $655,000
Currently asking: $499,000
I know this is a housing blog but I feel the need to share that my new car shopping is finally finished, after a long and exhaustive search. I have chosen the 2008 Saturn Vue Hybrid. The car is styled based upon on a GM Euro model the Vauxhall Antara and is assembled in Mexico with about 68% of the parts made in the USA and Canada.
This SUV “station wagon” is a mild hybrid with a 4 cylinder engine with an electric motor mated to the tranny (transmission). Base price is 21 K plus options for the non-hybrid. The mild hybrid adds only 2 k to the price, but gets 32 average mpg highway and 25 mpg local and weighs about 4k lbs.
I plan on moving and want decent mileage for a commute plus something new, and I had to get rid of the Hummer by May.
GMAC is willing to wipe the remaining 2 payments and 5k miles over the lease limit.
I save about 2k on the H3 lease and I was able to negotiate another 1k off the price plus lock in 1.9% financing.
I will be one of the first in NJ to drive this new 2008 Saturn VUE Hybrids since I snatched the dealer model before it arrived from Mexico.
I purchased this silver hybrid model.
http://www.edmunds.com/apps/vdpcontainers/do/MediaNav/styleId=100951659/firstNav=Gallery
Pray for me that it is not a lemon…..
tol Says:
April 7th, 2008 at 9:40 pm
Grim, It is a horrible time to sell so it must be at least ok time to buy, no? The urgency is gone for a long time no question.
tol: The answer is bifurcated. If your target is commutable to NYC wait. If not, these people a f—ed beyond recognition so go for it. The NYC pain is just starting in earnest. It will take a summer to bake into a nice souffle.
You want anecdotes?
My GSB/Cornell alumni events usually take a couple of weeks to fill up. Now any event with the slightest whiff of a financial bent sells out instantly.
I’m hearing stories about the all kinds of bankers sitting in the Starbucks reading the WSJ cover-to-cover again….
grim [263],
It deserves a ‘booyah’. I haven’t given up hope yet. I’m bangin’ my head against the wall and I continue to scrape money together. Who said war was easy? ;)
John – What about some of these auction rate securities? Some of these shorter dated obligations w/ high yields could be enticing? Thoughts?
Where is the long-term appreciation?
632 Lawlins Road, Wyckoff
Purchased: 5/15/1987
Purchase Price: $304,000
MLS# 2734801
Currently Asking: $499,000
This is crazy! Less than 2.5% a year appreciation. Adjusted for inflation (headline CPI), this property needs to be sold for more than $566,000 to break even.
Didn’t the Realtor commercial say that the price of a property doubles every 10 years?
If so, this place should be selling for $1,216,000.
Here we are, TWENTY years later and the property hasn’t even come close to doubling on a nominal basis.
I guess that doesn’t have the same ring to it.
Tol said:
For what it’s worth i think now is the time to look for deals.
Layoffs left and right, fifth largest IB bankrupt, largest morgrage originator almost bankrupt, hundreds of billions of losses, worst credit crunch in decades
…
Just don’t see the point in waiting more.
While we are starting to see deals emerge from distressed sellers, banks, or even smart sellers who understand it’s time to get out, I don’t think we are at the point yet where “now is the time to look for deals”.
While the stock market reacts in real time, or in anticipation of, negative economic events, asking prices on homes tend to be backward looking (after all, asking prices are set based on comparables; what sold last month, six months ago or last year). The bad news doesn’t get priced-in for some time. Did we see a wave of sellers cut their asking prices after Bear collapsed? Of course not.
Sellers tend to be very slow to react. Marge & Homer Homeseller don’t understand the connection between their home and Wall Street, IB bankruptcies or write-downs of CDO’s & SIV’s. They only “get it” when their home sits on the market unsold. After which, their first reaction is usually to get angry. Their realtor svcks; buyers are too cheap; after all, they aren’t just going to “give away” their house; their home, after all, is so much nicer than their neighbor’s house that sold in 2005 and we are even asking $2,000 less than they got! These sellers, to their own detriment, often dig in their heels refusing to “lose money” (i.e. realize either a real loss versus what they paid or even a theoretical loss versus the market peak).
Housing bubbles don’t burst like stock market bubbles do. They die excruciatingly slow deaths. While we are surrounded by bad news, many sellers refuse to give up the fight. This is why waiting still makes sense.
KL
that sounds like my area, so I can buy a condo for the same price as a house 10-15 miles away.
Something is broken :)
Not all in NJ, but a significant portion must be:
“Major job cuts by pharmaceutical companies since January 2007, and when they were announced:
_ Schering-Plough Corp., 5,500 jobs, 10 percent of staff (April 2)
_ Wyeth, 5,000 jobs, or 10 percent, Jan. 25
_ Novartis AG, more than 3,760 jobs, or 4 percent (Oct. 2007-Jan. 2008)
_ Bristol-Myers Squibb Co., about 4,200, 10 percent (Dec. 2007)
_ Bayer AG, 1,500 jobs, 1.5 percent (Nov. 2007)
_ GlaxoSmithKline PLC, unspecified jobs (Oct. 2007)
_ King Pharmaceuticals Inc., 560 jobs, or 20 percent (Oct. 2007)
_ Johnson & Johnson, up to 4,800 jobs, or 4 percent (July 2007)
_ AstraZeneca PLC, 7,600 jobs, 4 percent (July 2007)
_ Encysive Pharmaceuticals Inc., 150 jobs, 70 percent (June 2007)
_ Pfizer Inc., 10,000 jobs, or 10 percent (Jan. 2007)
_ Ligand Pharmaceuticals Inc., 267 jobs, or 76 percent (Jan. 2007)
Prior major restructurings:
_ Merck & Co., trimmed 7,200 jobs since December 2005.
_ Eli Lilly & Co., trimmed more than 5,000 jobs, about 11 percent, since 2004 and continuing.”
269 renting
Yeah
All of that.
Tol
“Just reread my post.. don’t think prices are goin up so no rush until you find what works for you. Just don’t see the point in waiting more.”
Prices will fall for another couple of years (except in manhattan, where they will fall for the next four years).
Perfectly good reason to wait.
Tol
“Also you have to admit this blog is more bearish than average buyer.”
I watched the “average buyer” in action between 1999 and 2006 and was not impressed.
Sean-
I think that looks pretty good. Good luck with that. I think the coupes look pretty good as well. Not high performance cars, but nice looking and good transportation. Let us know what the MPG works out to on that one.
JM
April 7th, 2008 at 9:00 pm
# 221 Also you have to admit this blog is more bearish than average buyer.
For what it’s worth i think now is the time to look for deals.
Nice one. it is excactly that – time to look for deals. So do other 1000000 or so residents of NJ. Every house priced under markets sells within a week.
It is a GREAT time to sell a house – just price it right.