According to S&P Case Shiller, NY Metro Area home prices are down 6.6% in the past year, and down 8.05% from the peak set in June of 2006:
(click to enlarge)
From Standard and Poor’s:
“There is no sign of a bottom in the numbers,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “Prices of single family homes continue to drop across the nation. All 20 metro areas were in the red for the February-over-January reading. In addition, 19 of the 20 MSAs are still reporting negative annual returns. The monthly data show that every one of the MSAs has now declined every month since September 2007, marking six consecutive months. On top of that, remained steep the declines have with eight of the 20 MSAs and both composites reporting their single largest monthly decline in February.”
From MarketWatch:
Home prices fall record 12.7% in past year, Case-Shiller say
The decline in U.S. home prices quickened in February, with prices down a record 12.7% in the past year for 20 key cities, according to the Case-Shiller home price index released Tuesday by Standard & Poor’s. “There is no sign of a bottom in the numbers,” said David M. Blitzer, chairman of the index committee at Standard & Poor’s. Prices in 19 of the 20 cities have fallen over the past year, with prices in all 20 cities falling month-to-month for six straight months. The biggest declines were in Las Vegas and Miami, with declines of more than 20% in the past year. Prices in Charlotte, N.C., are up 1.5%.
From Bloomberg:
S&P/Case-Shiller U.S. Home-Price Index Fell 12.7%
Home prices in 20 U.S. metropolitan areas fell in February by the most on record, pointing to an imbalance between supply and demand that shows no sign of ending.
The S&P/Case-Shiller home-price index dropped 12.7 percent from a year earlier, more than forecast and the most since the figures were first published in 2001. The gauge has fallen every month since January 2007.
Prices will probably keep sliding as foreclosures push even more properties onto the market just as stricter lending rules limit the number of qualified buyers. Shrinking home values have contributed to a slowdown in consumer spending that may already have tipped the economy into a recession.
“We’re going to continue in this abyss for a while,” said Ellen Zentner, an economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “Inventories are getting worked off but it’s a slow process. Sales and prices will go down.”
Prices dropped 2.6 percent in February from a month earlier, after a 2.4 percent decline in January, the report showed. The figures aren’t adjusted for seasonal effects, so economists prefer to focus on year-over-year changes instead of month-to-month.
The index was forecast to drop 12 percent following a 10.7 percent drop in January, according to the median estimate of 14 economists surveyed by Bloomberg News. Estimates ranged from declines of 12.6 percent to 11 percent.
The group’s 10-city composite index, with a history back to 1987, fell 13.6 percent in the 12 months ended in February, also the most ever.
From Reuters via CNBC:
Home Prices Tumble Again; ‘No Sign of a Bottom’
Prices of existing US single-family homes extended their slump in February, with 17 of the 20 measured regions posting record annual declines, according to the Standard & Poor’s/Case Shiller home price index Tuesday.
The composite month-over-month index of 20 metropolitan areas fell 2.6 percent to 175.94 in February from January, for an annual drop of 12.7 percent.
S&P said its composite month-over-month index of 10 metro areas slid 2.8 percent in February to 190.58, for an record annual decline of 13.6 percent.
Eight of the top 20 metro areas, as well as both composite measures had their biggest monthly declines in February, S&P said in the release.
From MarketWatch:
Deutsche Bank, Allianz take fresh write-downs
Deutsche Bank and Allianz, Germany’s two biggest financial groups, both announced further write-downs on Tuesday after the credit crisis worsened towards the end of the first quarter.
Deutsche Bank said it swung to a net loss of 141 million euros ($220 million) in the first quarter, from a profit of 2.13 billion euros a year earlier. It took a total write-down of 2.7 billion euros on leveraged loans, commercial real estate and residential mortgages. The result was the bank’s first quarterly loss in five years.
Allianz, meanwhile, said it will write-down around 900 million euros in the quarter due to the structured product exposure of its Dresdner Bank arm.
From the WSJ:
Home Vacancies Set Record
By REX NUTTING
April 29, 2008; Page D6
The share of homes vacant and for sale, an important measure of the nation’s housing supply, set a record in the first quarter in a signal that the glut of homes on the market isn’t improving.
The homeowner vacancy rate, which measures the number of vacant homes for sale, rose to a record 2.9% in the first quarter from 2.8% in the fourth quarter, about one percentage point higher than normal, according to new Census Bureau data. The vacancy rate has jumped nationwide and in cities, suburbs and rural areas since the housing bubble popped. From 1995 until the fourth quarter of 2005, the rate held between 1.5% and 2%.
About 2.2 million vacant homes were for sale in the first quarter, up from 2.1 million in the fourth quarter and about one million more than was typical before the housing bubble burst.
Economists say the rising vacancies indicate that home prices won’t stop falling and home builders can’t ramp up construction until the glut of vacancies can be worked down.
“It’s the worst piece of housing news that we’ve heard in the past couple of months,” said Patrick Newport, U.S. economist at Global Insight. “It means home prices will continue to drop at least for the remainder of the year.”
From the Star Ledger:
Corzine looking at targeted toll increrases to meet transit needs
Having scrapped his ambitious plan to attack state debt and fund road projects with big toll increases, Gov. Jon Corzine now is focusing on smaller toll hikes to pay for transportation needs without increasing the gas tax, according to individuals familiar with administration discussions.
While the full details are still being worked out, the goal would be to shore up the state’s depleted Transportation Trust Fund, two people familiar with the planning said. That could be done with far smaller toll increases than the 800 percent over 14 years that Corzine originally pitched in January as part of his ill-fated financial restructuring plan, they said.
The governor is hoping to secure a state budget agreement by June 15 — about two weeks before the constitutional deadline — and immediately begin negotiations on a scaled-down toll plan, said the individuals, who asked not to be identified because the plans are preliminary.
They said Corzine remains opposed to raising the 14.5-cent-per-gallon gasoline tax — the biggest current source of road project funding — because of soaring fuel prices.
From NJBIZ:
No Longer an ‘Economic Dynamo’
When it comes to creating private-sector jobs, New Jersey was a laggard in 2007 as compared with neighboring states and the rest of the country, according to a Rutgers University report released last week. Authors of the report say the state’s job growth will not improve this year while the nation enters a “deep recession” and a financial crisis that will be “arguably the worst since the Great Depression.”
New Jersey gained just 3,700 private-sector jobs last year, an increase of only 0.1 percent over 2006. That was significantly lower than the increases in New York and Pennsylvania, which saw private-sector employment gains of 1.2 percent and 0.6 percent respectively, according to the study.
“In terms of job growth, New Jersey fell significantly behind its economic peer states in 2007. The state has lost its role as regional economic dynamo,” says the report, which was titled “Reversal of Economic Fortune” and co-authored by James W. Hughes, dean of the Edward J. Bloustein School of Public Policy at Rutgers, and economist Joseph J. Seneca.
Overall, New Jersey ranked 41st among the states in percentage of private-sector job growth last year, according to the Rutgers report. That was unchanged from 2006. New York ranked 17th, up from 28th in 2006, while Pennsylvania ranked 29th, up from 34th.
The Garden State may have suffered recession-related layoffs earlier than its neighbors because Wall Street job cuts hit back offices in North Jersey first, Hughes said in an interview. He says the state lost 7,900 financial sector jobs in 2007, mostly in the second half of the year.
The entire Northeast will likely falter in 2008, the study says. New Jersey lost 10,500 private-sector jobs in the first quarter of 2008, according to the state Department of Labor and Workforce Development. “That’s a reflection of the national downturn,” says Hughes.
He says the pharmaceutical and biotech sector accounts for about 41,000 jobs in New Jersey, while financial businesses ranging from banks to Wall Street brokerages account for 269,000 jobs in the Garden State. The importance of these sectors to New Jersey puts the state at particularly high risk of layoffs, says Hughes. “We are going to get hit hard,” he says.
Behind the national recession are factors including the bursting housing bubble, the subprime mortgage crisis, growing turmoil in the credit markets and soaring energy and commodity costs, according to the report.
Hughes says New Jersey and the Northeast are feeling a backlash from the lending boom that lasted from 2001 through 2006—a period when “we had cheap global credit, lending standards disappeared, there were record Wall Street profits and great job growth.”
There’s little that Gov. Jon S. Corzine and the rest of state government can do to ease the pain of the recession, adds Hughes. “They are prisoners of forces that may have built up over a 10-year period,” he says.
From the NY Times:
Junk Bonds, Mortgages and Milken
Critics who compare the subprime debacle to the bubble in high-yield, high-risk corporate bonds that Drexel helped inflate two decades ago are “people who don’t understand markets very well,” Mr. Milken said. He suggests that “their rationale is that both types of financial instruments are risky.”
And he says junk bonds, or those rated below investment grade, “have little in common with mispriced subprime mortgages,” which he says are the real culprits.
“Having financed several of America’s largest home builders, I know a few things about the housing industry,” Mr. Milken said. “What happened to housing was not a failure of securitization, but rather a disastrous lowering of underwriting standards and other unfortunate practices.”
Criticizing securitization — the slicing and dicing of debt that he helped popularize — is “like condemning scalpels because a few unqualified surgeons have injured patients,” he said.
#2
“It’s the worst piece of housing news that we’ve heard in the past couple of months,” said Patrick Newport, U.S. economist at Global Insight. “It means home prices will continue to drop at least for the remainder of the year.”
Am I missing something here? How is it bad news that prices are falling? Is it better to be so highly leveraged you are eating rice and ramen 3 times a day?
#4
“There’s little that Gov. Jon S. Corzine and the rest of state government can do to ease the pain of the recession, adds Hughes. “They are prisoners of forces that may have built up over a 10-year period,” ”
How is that bad news? Corzine wanted to raise tolls 800% over a 14 year period and the legislature’s pork barreling and smoke and mirrors budgets are on the verge of bankrupting NJ. The less those greedy grubbers do, the better off we are.
From CNBC:
Housing Price Drops: New England Is NOT Home, Sweet Home
Tomorrow the folks at S&P/Case Shiller will report the monthly prices in the nation’s top ten and top twenty metro markets.
Every time I report these numbers I get any number of critics arguing that the fall in home prices is really concentrated in only a few large cities in the nation, most of them in California and Florida.
…
The median price of a home in Massachusetts, and I’m not just talking about Boston, fell more than 10 percent in March from a year ago. “The last time prices declined by more than 10 percent was in December 1990, the nadir of the early-1990s housing crisis,” says the report. That downturn was fueled by the banking failures in the 1980s, but this time the finger is pointed squarely at foreclosures.
Those Who Know and Those Who Don’t
http://seekingalpha.com/article/74547-those-who-know-and-those-who-don-t
A little tidbit on builders stock. MM
Here we go again: another big difference of opinion between those who think they know what is going on and those who actually do.
In one camp are equity traders, who keep claiming to see a bottom in all manner of markets. The other group includes those on the ground, who have to deal, first hand, with the ugly fallout from a plethora of bursting bubbles.
From Pharmalot:
Wyeth Lays Off Another 1,200 Employees
You read it here first. The drugmaker last Friday notified employees that still more jobs are going, a Wyeth spokesman confirms. This follows an announcement last month that 1,240 sales positions would be eliminated as part of what Wyeth execs are calling ‘Project Impact.’
From Bloomberg:
Homebuilders Turning Into Small Caps as Slump Cuts Value by 67%
The worst housing slump in 70 years erased 67 percent from the market value of homebuilders in the Standard & Poor’s 500 Index, turning the companies into small-cap stocks.
Centex Corp., the nation’s biggest builder by sales, is valued at $2.62 billion, a quarter the size of the largest company in the Russell 2000 Index. Home developers in the S&P 500 have a total market value of $16 billion, down from $49.2 billion at their peak in January 2006 and less than Kroger Co., the biggest U.S. grocery chain.
“They went through the laundry and got shrunk,” said Stephen Lieber, who oversees $11 billion as co-chief executive officer of Alpine Woods Investments in Purchase, New York. “It’s gone beyond an inoperable business situation and turned into an economic crisis.”
“Deutsche Bank, Allianz take fresh write-downs”
That CAN’T be true!! bi and S&P said there’d be no more writedowns!!
My question fioor the realtors and RE bulls outhere:
HOW do one find fair market price of a house in an enviroment, where there is no offers on a house and: last sale resulted in Foreclosure 7 month!!! after the sale.
Obviously I would discard the last sales price. Bank which owns property agrees with me.
Bank is listing it 13% below last selling price. Previous sale was in 2007 for 269K. before that it was sold in 2000 for 119K.
I do not know if house has being remodeled- it looks like it might have being but right now it is in pretty bad condition.
So whats fair price?? Do not tell me whatever I want to bid – Obviously I want to bid 0. Taxes also doubled since 2000 – they are now 7500$ (On a 239K listed price house, crazy is’nt it?)
P.S. 5% compound appreciation since 2000, yields 175K. at 175K this hopuse PITI+PMI+Insurance payments will b the same as newer apartment rental in the area. Funny – houses in the area right now are renting for LESS than comparable Sqft apartments.
“Wall Street job cuts hit back offices in North Jersey first, Hughes said in an interview. He says the state lost 7,900 financial sector jobs in 2007, mostly in the second half of the year.”
[4]
Do these count for WS job losses or are they part of California’s total?
Bloomberg:
KB Home’s Broad Says Home Prices May Drop Another 20%
http://www.bloomberg.com/apps/news?pid=20601087&sid=aNGtHO1tbzng&refer=home
“I don’t think we’re anywhere near a bottom in housing,” Broad told Bloomberg TV at the Milken Institute Conference in Beverly Hills, California.
“It’s gone beyond an inoperable business situation and turned into an economic crisis.”
[11],
What bubble?
“Corzine looking at targeted toll increrases to meet transit needs”
It outrageous that the tolls on GSP and Trunpike HAVE NOT increased in many years. What is the government waiting for? Let raise the tolls now!!
How about the fact that nobody is reading Star-Ledger?
15. The Star-Ledger of Newark, N.J., 345,130, down 7.4 percent
http://ap.google.com/article/ALeqM5iD52BVPLxH_ba3UVP5TXAJeGAQ2AD90AU14G0
Here’s the latest missive from Bill Gross:
http://tinyurl.com/55udbg
The part toward the end is the most intriguing, as he’s now openly calling for mortgage balance writedowns, then refinance- at below-market rates- via FHA, in order to stabilize home prices and stave off asset deflation serious enough to take down the whole economy.
Al (13)-
Why the hell do you want to buy this place…at any price?
Sounds like the bottom just fell out of that area. Why be the crash test dummy who gets to find out how far things can drop?
BC (14)-
I think this stat is what Pret might term an “outlier”.
I don’t understand why a toll increase is somehow more equitable or palatable than a gas tax increase.
Toll increases disproportionately affect those who have no choice but to drive the toll roads, while those who don’t see no increase at all. North/South commuters will bear the brunt while East/West commuters get away scot free.
Of course, you could argue the same for a gas tax increase, long-distance commuters get hit disproportionately, even more so with an increase.
Either way, lower income residents take get hit harder.
Screw everyone over, do both.
grim (22)-
Please, Guv, give me another reason to leave this s&*thole.
NJ’s transition to complete welfare state may be complete by 2015 or so.
Nobody left but the ultra-rich and ultra-poor.
Heres a novel idea.
Reduce the cost of rail transit to encourage greater ridership. Economies of scale in rail will improve to erase shortfall. Need to repair/widen roads will lessen leaving more money to be invested in non-road related transportation infrastructure. Oh yeah, there is an environmental benefit as well.
Good idea? Nah! Lets build more roads. Driving is much more fun!
Stu (25)-
Please keep your good ideas to yourself. Or, if you decide to take it to Trenton, present it as a graft-and-inefficiency-riddled boondoggle.
welfare state , now you have it.
Heres a novel idea.
How about we let our roads and bridges deteriorate to unsafe level so people have no choice but to take the train?
perhaps we can employ ourselves to properity .. lets hire more state and locals.
I’m going to argue that the loans weren’t bad at all, “expectations” and “assumptions” were the problem.
From Bloomberg:
Countrywide Reports $893 Million Loss From Bad Loans
Countrywide Financial Corp., the mortgage lender that Bank of America Corp. plans to buy, reported a third straight quarterly loss as late payments and home foreclosures escalated.
The net loss equaled $893 million, or $1.60 a share, compared with a profit of $434 million, or 72 cents a share, in the year-earlier period, the Calabasas, California-based company said in a statement today.
Countrywide’s latest loss may feed investor concern that Bank of America will reduce or cancel its January offer to acquire the nation’s biggest mortgage lender for about $4 billion in stock. U.S. foreclosure filings jumped 57 percent and bank repossessions more than doubled in March, according to data vendor RealtyTrac Inc.
Bank of America, the nation’s second-biggest bank by assets behind Citigroup Inc., said April 21 that the sale remains on course for completion in the third quarter.
…
The mortgage company posted a $703.5 million loss for all of last year, the first in 30 years, because of higher loan losses and writedowns of securities backed by home loans.
Provisions for credit losses were $1.5 billion in the first quarter, compared with $925 million in the preceding quarter and $158 million in the year-earlier period. Results included $441 million of impairment charges tied mostly to home-equity securitizations.
Foreclosures doubled to 1.64 percent of unpaid principal in February from 0.8 percent a year earlier at the servicing unit, Countrywide said on March 13. Home loan payments more than 60 days late declined to 7.44 percent of unpaid principal in February from 7.47 percent in the previous month, the company said in the same report. It has since stopped issuing monthly updates on overdue loans.
Clotpoll (24): NJ’s transition to complete welfare state may be complete by 2015 or so.
Nobody left but the ultra-rich and ultra-poor.
Clotpoll; Not to worry, History Channel say’s Game Over 12/22/2012 anyway.
grim (30)-
They should put Tangelo’s black box in the Smithsonian.
confused (31)-
As in, in the end we’re all dead?
Calling it a ‘Black Box’ is giving it too much credit, it wasn’t much more than a stack of NAR press releases inside a Hawaiian Tropic carton.
(32)-
On second thought, maybe just put Tangelo himself in the Smithsonian.
Kinda like what the Russians did with Lenin. Hell, John Q won’t even have to pick up the embalming tab. He’s friggin’ preserved for eternity already.
“More on Catching the Bottom in Housing”
http://www.oftwominds.com/blogapr08/RE-bottom2.html
We haven’t had a good Mozilo bash here in quite a while.
Refreshing!
Stu Says:
April 29th, 2008 at 8:33 am
Heres a novel idea.
Reduce the cost of rail transit to encourage greater ridership. Economies of scale in rail will improve to erase shortfall. Need to repair/widen roads will lessen leaving more money to be invested in non-road related transportation infrastructure. Oh yeah, there is an environmental benefit as well.
Good idea? Nah! Lets build more roads. Driving is much more fun!
When I got to NJ I was amazed how expensive rail/trais were. The whole idea of a mass transit is to be SIGNIFICANTLY cheaper than commuiting by a car.
While it may be the case for people commuting to NYC, if you commute by train within NJ it is a lot more expensive than car, even with 4$/gallon gasoline high car insurance and maintenance on a car.
P.S. I love trains – nothing can beat service to Washington DC – last snowstorm my wife’s airline tickets got cancelled, we just hopped into car, got to metropark station, bought tickets and in 20 minutes she was on her way to DC.
Tickets – same price as airlibne tickets, not missing meeting in DC – priceless.
now whereelse could you get such a refreshing view of life, but in NJ.
Plenty to do and enjoy.
BoA is going to have no choice but to jettison the Countrywide brand if they move forward with this deal.
Al,
Work backwards:
If you think the house would be worth X when completed, (let’s use $175K) and you estimate it would cost $40K to repair (always add 10-20% above your estimate for a real number)…
So you think it would take 45-50K ish to make the house worth what you would pay $175K for, offer $120K or so…
This takes NOTHING into consideration about RE price degradation, etc… but at least it’ll give you a firmer footing on where you can pitch numbers…
(and don’t forget repairing and remodeling is hard work…we have a 200 year old house…it wasn’t finished in the first 200 years, and it certainly won’t be finished by us…!!!)
Light at the end of the tunnel? Hope? First signs of real change in NJ?
From the AP:
Two NJ towns with building problems considering sharing, merging
It took the fall of communism in East Germany to bring together East and West Berlin. Uniting New Jersey’s two Berlins might take nothing more than mold in a municipal building.
Camden County’s Berlin evacuated its municipal building two weeks ago because of a mold crisis. Community officials are talking about putting up a new shared town hall with neighboring Berlin Township — or even merging entirely eventually.
Berlin Township Mayor Phyllis Jeffries-Magazzu told the Courier-Post of Cherry Hill that a merger is a possibility in the future. Her town closed its decaying municipal building in 2006.
From MarketWatch:
Falling home prices remain a threat, Pimco’s Gross says
Policymakers — but not the Fed — need to act quickly to prevent falling home prices from sparking a “ruinous” deflation in asset prices, wrote Bill Gross, managing director of Pimco, in his monthly letter. Further rate cuts from the Federal Reserve would do more damage than good, he said. “The better alternative is to initiate a limited mark-to-market write-down of private mortgage debt as envisioned in the Dodd-Frank congressional proposal combined with government-subsidized loans at below market rates,” he said. Pimco manages about $750 billion in assets.
Clotpoll Says:
April 29th, 2008 at 8:27 am
Al (13)-
Why the hell do you want to buy this place…at any price?
Sounds like the bottom just fell out of that area. Why be the crash test dummy who gets to find out how far things can drop?
I am true believer that the good deals are to be had when markets are in turmoil, nobody really knows what is going on, and, more importantly, I need a bigger place. I can see myself living in that house for 5-10 years after I fix it up a bit.
Rents are high, I have dog – limited number of rentals + non-refundable one time fee (from 500$ to a 1000$) and 50$/month pet fee’s really adds-up,
Add on mandatory!!! health club membership and other fee
s like breathing of the “apartment complex’s air” fee – it kind of add’s up. My current place is ok, by it is small, only one bedroom – hard to do with 1 year old and a dog.
I might rent a house in the area instead – they are offered for rent at 400-500$ cheaper than 2 bedroom apartments.
Funny part – EVERY block has a house for sale. Some two or three. Ridiculous. Most people do not need to sell though as they are still asking 2005 prices +10%, and never reduce their price. I wonder at what point will realtors start feeling costs of maintanance of a listing, and decline overpriced listings??
Ok I am gone for now, will be back in the evening.
“need to act quickly to prevent falling home prices from sparking a “ruinous” deflation in asset prices,”
[43],
Bill, we know where you sit. Shut up and take a beating or trade out of your position.
Greetings from Miami
The amount of new construction down here is amazing. I knew a number of condos have been built, but an incredible amount are still under construction. Almost every building down here has a crane on top and a giant banner advertising sales. I can’t imagine how long it will take to work though the inventory.
When I checked into my hotel, I actually got upgraded to a condo (no charge). I’m blogging from my kitchen with the granite countertops and stainless appliances. The bellhop told me that this was a condotell, where the rooms are actually owned by private investors and rented by the hotel. The condo I’m in was actually supposed to be lived in as a residence. The plan for my building was supposed to be half residential condo half hotel, but there are just too many empty condos down here. Well, at least I get something nice out of this mess.
From Standard and Poor’s:
Steep Declines in Home Prices Continued in February 2008 According to the S&P/Case-Shiller® Home Price Indices (PDF)
grim (40)-
What? No colorful Countrywide kiosk in every BofA location, staffed with bright, attractive loan officers?
Al (44)-
“I wonder at what point will realtors start feeling costs of maintanance of a listing, and decline overpriced listings??”
When the repo guy is putting the hook into the Benz or Beemer and the agent can’t hoof it to the parking lot, because he’s stuck on the phone, fighting with Capital One.
I’ve been wondering about this for over a year now. I certainly can’t afford to maintain marketing on listings that don’t sell…and I like to think of myself (at least on good days) as somebody who will survive this mess. A few months ago, I even took to rejecting listings of my other agents when they brought in stuff that had no chance of selling. I lost a couple of agents, but I notice they aren’t exactly lighting it up in their new offices.
My favorite stupid comment today was a newspaper article that said the low income earners won’t be spending their rebate checks in the retail stores as it is either going to cover outstanding bills or higher food and energy costs. Then they state the higher earners will however be buying the coach pocketbooks and taking vacation with their checks.
Wait high income earners don’t get checks only low income earners that have all time record amounts of debt and sky high fuel and food costs. I mean it is nice to help out the poor and lower middle class and I support that but to claim this will cause a huge spending at the retail stores is nuts.
Clot,
The wheels will fall off the Man U bus this week. Barca will score and go through on the away goal rule and West Ham will pull a draw out on Saturday.
Realtors can last a long time, my friend the ex-realtor quit in 2007 along with everyone else who became a realtor in the 2002 to 2006 period. He says now in his Century 21 office it is all owners, older pros who have made a killing the last ten years who can afford to wait is out and part time housewife realtors who have a husband to support them. Every 25-45 year old realtor who supported a family on that income has bailed out of his office. My friend made zero his last six months as a realtor in the first half of 2007 and made almost 200K in 2006, that is a heck of a cliff to fall off. The older realtors say this is a cycle and should be done in 3-5 years, yea like my 42 year old friend with 12 and 14 year daughters and a part time working wife can go five years without a paycheck!
PGC (52)-
That’s a bold statement. I think Barca’s ultra-tactical diagonal/horizontal stuff gets blown apart, Barca doesn’t score and Ronaldo bags 1-2 goals. SAF won’t hold back this time; it will be EPL pace-and-power from the first whistle.
West Ham…you may have a point there.
Got to like Chelsea now over Liverpool. I think the Reds will fold under the pressure.
Don’t pit affordable housing
Tuesday, April 29, 2008
BY MICHELE S. BYERS
Everyone knows it’s expensive to live in New Jersey and that housing costs are through the roof. For more than 20 years, our state has been trying to provide affordable housing. It’s an important public goal, one that we ought to be able to figure out. Unfortunately, new rules put out by New Jersey’s Council on Affordable Housing will pit housing needs against clean water, open space and other environmental quality needs of our citizens.
The thing I don’t understand is why the same folks who don’t want affordable housing in suburbs, supporting Mc-Mansions on 5 acre lots. Isn’t that environment destruction to extreme?
I feel all politicians have botched the housing issue. The need for housing is not just for lower income class, it also exists for middle income. The issue is Builders are not building smaller size, high density houses, for which there could be some environmental incentive.
# 2 from the other thread:
“People who are facing foreclosure due to job loss, medical bills, death of a family member, etc, those types of cases I do feel sorry for.”
I have heard a bankruptcy judge speak and he said that in nearly every case he has ever seen the people who enter bankruptcy “because of” a job loss, medical bill, or some other event had in reality pushed their finances to the brink so as to allow any unexpected event to push them over the edge. Although the prticiular event may have triggered the bankruptcy it is not in fact the cause; the cause is overconsumption, with the “triggering event” just the last in a long line of events leading to an easy to predict fall.
John (53)-
Cycle? Cycle of what? Prices?
I don’t give a damn what the prices are. All I care about is deal flow.
And, this cycle is so damn nasty, because all the short sale business that could be getting done is being preempted by people who can now flip their keys back to the bank with little-to-no consequence.
According to the S&P Case Shiller HPI for the NY Metro Area (Commutable), prices are down 8.05% (nominal) from the peak set in June 2006.
Clot,
I wonder if Realtors will eventually realize that defending high home prices is having a negative impact on ‘deal flow’.
I don’t think it will ever happen. Mainly because most Realtors I know drank their own Kool-aid and are now finding themselves long and wrong.
Earlier today, I heard a story on the radio about a woman who was a medical secretary who ran up $21,000 in credit card debt. She states that there is NOT ONE purchase that did not need to be made and they were all made “just to survive.”
I would wager that Mrs. Shore and I earn many multiples of this woman. And, although there are some months that we might put $20,000 or more on a card or two, we would never allow as much as $2,000.00 to carry over to another month.
Do we as consumers have any grip on what “is needed to survive”? I suspect that many people here grew up in post-war suburbia in the ’60s and 70’s and that were most people transported back to those houses, cars, and amenities, we would see ourselves as poor.
I suspect that this belief that we SHOULD be able to have X or Y has fueled the run-up in home prices.
I just did a search and here is the Judge, his name is and, as Dave Barry would say, I am not making this up, Ninfo.
http://www.careprogram.us/
# 57 and 59 BINGO. As long as the pace of sales is good, RE agents can make a buck. I have seen many RE agent-owned homes on the market and it looks like many agents tried to make the leap from agent to mogul.
# 25 First, the railroads do not run to the RIGHT soccer fields
Second, One does not look stunning steping out of a train car the same way one does steeping out of an Escalade.
Homebuilders seek Tax Break for Buyers to Halt ‘Recession’
The Washington builders’ group’s chief economist, David Seiders, says the housing slump has pushed the economy into a “mild recession.” The trade group has been pushing aggressively on Capitol Hill for legislation, such as a temporary tax credit for home buyers, arguing that doing so could stem the housing downturn.
“Measures that stimulate consumer confidence in the housing market, push the fence-sitters into the ring and put a floor under house prices can successfully halt the drag that housing is exerting on the national economy, and help stabilize financial markets at the same time,” Seiders said in a statement.
Fitch Ratings said in a conference call Tuesday that the housing sector is likely to continue to contract throughout 2008, and could worsen further in 2009 if the economy slides into a sharp recession.
The ratings agency said low mortgage rates, cheaper home prices and government proposals to aid the ailing industry will not be enough to spark a turnaround.
“Despite a few steps in the right direction, U.S. housing remains mired in a steep cyclical decline, with more pain likely for U.S. homebuilders through 2008,” said Fitch homebuilding analyst Robert Curran.
Shore Guy (60):
“Do we as consumers have any grip on what ‘is needed to survive?'”
The parents of the Gen ‘Y’ers were spoilers. The ill effects of this are now coming out.
Have a kid and go to ‘Buy Buy Baby’. The name of that store alone should be banned. See what needless krapola parents are buying for their kids.
When I was protesting the double digit tuition hikes back when I was in college, I would say that less than 1 in 10 kids were paying for their own schooling. And this is Montclair State College I’m talking about.
If you want your children to learn the value of money, you have to let them spend some of what they earned. Allowance is the devil. I never had it and I will never give it.
John (51),
I totally agree, I was hoping to buy a new road bike with my check but lo and behold will not be receiving one. The limit for singles is $75K for the full amount and the phase out ends at $87K, right?
Also, just the vent a bit, a 27 year old friend of mine who lives in a crap house in Jackson that they over-paid for just bought a new Acura RDX at an interest rate of, get this, 18.5%! I guess the ’05 Explorer just wasn’t cutting it anymore. Her credit must be abysmal. With one child already and another on the way at the end of summer this purchase sure seems like a wise investment! Did I also mention that the house in Jackson was the only house she and her husband even looked at before they bought? They made an offer as soon at they saw it. I can’t blame them though, they negotiated a great deal. Asking was $349K and they stole it for $347K……
From yesterday’s thread:
Those among us who earned too much to qualify for a tax rebate check should thank the little people whose work-derived income was taxed at a higher rate than your capital gains.
Thanks to people who actually contributed to the economy through the creation of goods and services [presumably] enabled the Shore Guys of the world to pay 15% on money made from money that was made from money.
Moody’s Downgrades 388 Alt-A RMBS Classes; Warns on 254 Aaa-rated Tranches
First, subprime. Next, Alt-A.
The red pens at Moody’s Investors Service are now, officially, running low on red ink. After downgrading 1,923 subprime RMBS classes between Monday and Tuesday of this week — including numerous previously Aaa-rated tranches — the hits to Aaa-rate RMBS just kept coming on Wednesday.
The agency downgraded another 510 classes from 64 additional subprime deals, according to calculations by Housing Wire, and then got busy cutting up Alt-A securities — to the tune of 388 classes downgraded from 75 different Alt-A deals. IndyMac figured prominently into the Alt-A downgrades, with a full 46 of the 75 issues downgraded tied to the former Alt-A powerhouse.
Moody’s also warned of pending downgrades to a stunning 254 different Aaa-rated Alt-A tranches, worth well into the hundreds of billions of dollars.
We can’t help but wonder what the Federal Reserve is now holding on its books, given the amount of Aaa-rated securities that have been cut in the past three days alone. One thing is ominously certain for the financial markets, however — the write-downs are far from over.
Received an opt out notice from my Citi Business Card yesterday. Mind you, it doesn’t really apply to me since I have never made a credit card interest payment in my life, but…
1) Default rate is now 29.99%
2) Minimum Finance charge is now $5 or 3% (whichever is larger).
3) Late fees and other similar miscellany is now $39 and is treated as a finance fee.
4) Foreign transaction fee now 3%.
Now I have excellent credit and usually don’t pay attention to this stuff, but these numbers seem outrageous. It may be time to invest in Visa?
# 47 “The amount of new construction down here is amazing. I knew a number of condos have been built, but an incredible amount are still under construction. ”
I was in Miami and Lauderdale about two weeks ago and witnessed it myself. It is amazing, the pace of building down there. I too stayed at a condotel, oceanfront with about 60′ of wraparound balcony. The price was less than I pay for business travel to manl locations with far worse weather and far less pretty views.
About Miami, perhaps someone can put a finer point on this but I recall readintg that on an average year people buy about 2,500 new condos in Miami, but there are or soon will be completed about 50,000 new units.
It might be a trend that NJ towns buy their lower income folks a condo in Miami and tell them to move. Might be less expensive than paying Patterson to take them in.
All this talk about finding “the bottom” just means that some people are going to get screwed…
I’d love to see a cartoon of a house, in a toilet, with a little cartoon Realtor pointing up at the sky and saying “Look, a bottom!”
And in the next frame, zoomed out, you see, well, someones bottom, hovering over strategically.
Crude, I know. Is there an artist in the house?
# 67
Touche, except in the case of me and Mrs. Shore, about 95% or more of our income comes from our business ventures. We work our @sse$ off and earn every dollar we bring in. The other morning, Mrs. Shore was at work at 7:30 to serve breakfast to her staff as part of employee appreciation day and, like most nights, was in the office until 9:30 p.m.
There may be some here sitting pretty clipping coupons on bonds, or from trades on equities; however, that is not me. All of my capital is at risk every day and if I do not keep my clients I do not eat. If I do not add clients, I do not grow.
Consequently, I do in fact resent misspending on the part of government and the bailing-out of people who make really bad decisions.
bcamp111: Not sure if you’d consider an off-the peg Ultegra-equipped bike, but this is a killer deal:
http://www.bikesdirect.com/products/kestrel/rt700_blk.htm
Sub $2k. Was considering it as my first non-metal-framed ride. (Or maybe I’ll keep saving for a Litespeed Ghisallo.)
Not getting a rebate check, either. Not complaining. I save approx $1200/annum in NJ Transit fare alone, just by cycling to work. Industry crafts its own rewards.
From Bloomberg:
GMAC Posts $589 Million Loss on Home Lending Woes
GMAC LLC, the auto and home lender that General Motors Corp. sold to a private equity group, posted a $589 million loss in the first quarter and said it may not make a profit until next year.
The Detroit-based company, which reported a $305 million loss a year earlier, said in a statement that the latest results included a loss of $859 million at its Residential Capital LLC mortgage unit. ResCap recorded a $910 million loss a year earlier. GMAC’s auto finance business earned $258 million, compared with a $398 million profit last year.
“It’s a crazy quarter, not just for them, but virtually everybody in mortgage lending,” said Mirko Mikelic, a money manager at Fifth Third Asset Management in Grand Rapids, Michigan, before results were released. “The news from mortgage reports such as foreclosure and delinquency rates continues to be bad.”
“And in the next frame, zoomed out, you see, well, someones bottom, hovering over strategically.”
JB,
My vote goes to Gisele.
From MarketWatch:
U.S. April consumer confidence 62.3 vs 65.9 in March
Richard Simmons has been looking for bottoms for years and loving it!!!!
67: Okay, so as a really, really, really rich (and really, really, really virtuous) guy, you don’t benefit mightily from the recent (i.e., Bush era) transition from progressive taxation to more regressive sorts?
The crumbs thrown to those receiving rebates do not in any way compare to the sort of largess thrown at machers.
You know that, but still thought it was funny to demand thanks.
You’ll find a greater source of government mismanagement in the tax codes than in an election-year handout to the working classes, objectionable as the latter may be to some. But then you might also find a greater benefit to yourself in those codes.
Sure, live in a house without mirrors. But don’t complain when you step outside looking the fool.
does anyone have a list of all the write downs so far, or know where to find one?
Price declines appear to be accelerating, not bottoming, according to the S&P Case Shiller HPI for the NY Metro Area:
YOY price change
Feb 07 -0.91%
Mar 07 -0.91%
Apr 07 -1.56%
May 07 -2.35%
Jun 07 -2.94%
Jul 07 -3.21%
Aug 07 -3.37%
Sep 07 -3.62%
Oct 07 -4.08%
Nov 07 -4.51%
Dec 07 -5.31%
Jan 08 -5.60%
Feb 08 -6.62%
“does anyone have a list of all the write downs so far, or know where to find one?”
I’m sure they’re written down somewhere! ;)
Jamey, what the heck are you talking about. Those who earn more than 99.5% of population are not complaining about the check. My problem is I am not rich, my pos crap house has over 8k in taxes and our state taxes are high that combined with my 3 kids threw me into AMT this year and caused me not to get a rebate check. The income amounts needed to qualify should have been adjusted based on cost of living and amount of kids one has. In realty a rather wealthy person for Albama is getting a check while someone at that same income in the NYC area who takes his ten year old car to Pathmark with coupons powered via no-name gas is not getting a check. Only the private equity cowboys are getting away with paying 15% taxes the normal middle of the road VP who makes 200K a year is getting taxed to death and has tons of expenses. The 200k to 500K crowd pays the lion share of taxes in the US. The really rich have tax advisors, set up trusts or corporations or uses cap gains and genrous T&E deals or money losing investments to save on taxes, that costs money to set up and is not worth it at 200K plus low man on the totem pole have no say in how compensation is paid. The get their checks bend over and write out rebate checks to the subprime crowd.
BTW what is the big deal about rice? I hate rice and I could live with out eating it, why don’t they just eat cheap potatos or pasta. Those asian countries are just way to nutso for rice.
According to the S&P Case Shiller HPI for the NY Metro Area (Commutable), prices are down 8.05% (nominal) from the peak set in June 2006.
Grim,
He’s numbers are very conservative as it’s plain to see that the 5 boroughs, NNJ and LI have taken a double digit haircut. DOes he own anything in these necked of woods?
does anyone have a list of all the write downs so far, or know where to find one?
Kettle,
Ask BI. He’s the axpert on writedowns. In two years, I hope you’ll be able to count to a trillion.
“And in the next frame, zoomed out, you see, well, someones bottom, hovering over strategically.”
As disguisting as it may be, My vote goes to Mozzillo.
As disgusting as it may be, My vote goes to Mozzillo.
The real question is, “Is Mozilo’s bottom bronze like the rest of him?”
You may now return to eating your early lunch…
# 79
I agree that there is a lot to complain about inthe tax code. But just because there is, we as a nation should not use that as an excuse to throw borrowed money at the middle and lower earners. I for one would not object to a debet-reduction surtax ONCE WE HAVE THE DEFICIT ELIMINATED. Interest on our debt is a milstone on every taxpayer and our posterity. Posterity — remember when politicians thought about that and not just their own posteriors?
Nevertheless, as someone who pays taxes to about half the states, and a number of foreign governments, and who is responsible for both halves of the social security tax, and who will likely never see a dime in return for those payments, I reserve the right to point out the absurdity of borrowing money to distribute to people who as a whole have negative savings and as a rule spend too much just so they can go out and spend some more.
Were it a cheap election-year ploy, maybe I could ignore it; but, this is an expensive ploy that flies in the face of what the nation needs in order to promote longterm economic strength.
So, yes, I think a little thanks are in order to those of us who are footing the bill. Not to recognize that the payments are being made on someone else’s back reaks of a feeling of entitlement that is at the root of our economic ills.
#64 SG: Well if it is a “mild” recession, than why do we need another special tax break to pump housing?
Some news from trenches:
I wanted to put an offer on REO. I was pre-approved from Local NJ bank.
Bank has DECLINED my pre-approval and said that they only want to see pre-approval from Major bank – like Wasington mutual , CITI or Bank of America with my offer.
Right now I am going through pre-approval with BoA – I am being put on hold while they are checking info out – like my checking and savings account balances!!!
Thats just for the pre-approval!!!
They said: 10% down minimum – they will give no loans in NJ loans for less than 10% down. I can still get an ARM but 10% down is a must.
Also – they did likemy 775 average credit score. Did not like car loan! Liked no credit card debt.
Definatelly huge difference from last year pre-approval where all I gave them is my SSN, and desired price range and my salary number. Last years they e-mailed me pre-approval withing 5 minutes.
I am starting to think that by the time I will actually go for closing there will be some @nal probing involved. And all I am asking for is a very moderate 240K loan.
Make check out subprime crisis on wikipedia I believe there is a tally of the writedowns.
I just heard that South Brunswick schools are cutting teachers…one per grade level due to decreased enrollment. I’m suprised as I thought that is a growing area. Maybe they lost one kid per grade level and are using that as an excuse to ditch teachers and cut expenses.
U.S. Banking System on the Fritz
http://www.minyanville.com/articles/dollar-US-savings-debt-banking-income/index/a/16937
The adjustments were enough to assure that the current $300 billion in bank write-downs (debt destruction) will eventually be more like $1 trillion rather than the more sanguine numbers published by Wall Street along with the cries of “the worst is over” by “those that benefit the most”.
X-underwear said:
“I’m suprised as I thought that is a growing area. Maybe they lost one kid per grade level and are using that as an excuse to ditch teachers and cut expenses.”
In regal Montclair, although enrollment is declining, we have decided to go forward with the construction of a new $37 million dollar elementary school. Additionally, the BOEs original budget increase was 5.6%. Of course, we don’t get to vote on it.
Al that is good news, they should check the credit records and require 10% down. My friend is housing shopping now and was told to stop leasing her car as that is a red flag for getting a mortgage. She is turning it in at leases end. To be honest if you can’t even afford to buy a car shouldn’t that be a bit of a negative indicator when you are talking about loaning out a 1/4 of a million dollars. Back in 1992 when I was REO shopping the good places were cash only deals and the one place I did buy wanted 10% within 48 hours and required me to put down 25% which was not too hard considering home prices had completely collasped so that 25% down was not that much money in 1992.
# 93 Is there any move in that area towards home schooling or private schools of one type or another?
The 200k to 500K crowd pays the lion share of taxes in the US.
Most tax benefits start to go away actually at 150K limit. Our family just crossed the limit and my taxes went 5 times more compared to last year. In fact, when we did calculation, At present, it is more economical from my wife to stay at home than to work. The money spent in Day Cares, Summer Camps, Taxes, Baby Sitting etc… take huge chunk out.
It is funny – rich people in this country enjoy best tax lawyers and 15% capital gain tax.
Middle class – the ones who has their money in 401K – they are paying full share as their 401K distributions upon retirement are treated as income…
If you ask me 15% capital gain tax is the biggest donation given to rich people.
Stud(not) Says:
In regal Montclair, although enrollment is declining,
I love Montclair but never plan on owning there due to the out of control taxes….top 10 in state
Al
We are having a similar experience. We are working with JP Morgan Chase since they are tied in with my wife’s employer who offers a decent mortgage assistance program. My wife’s employer will loan you 15% down, interest and payment free for six years (you can make payments if you want). The forgone interest is considered taxable income. Up until this year, the bank writing the primary loan only required 5% down, with the 15% frome her employer. They now insist on at least 10% out of pocket, they would prefer 15%, want perfect credit and no outstanding debt. They also insist the primary be less than 417K. We have 20% in cash to put down but were considering making use of the employer benefit since it’s essentially a free loan for six years. However, if you leave the company you have to pay off the second loan in 120 days. We are weighing this financing vs a typical 20% down, 30 yr fixed deal. We have gotten the pre-approval on the first scenario but haven’t talked to a bank about the typical route yet, I’m guessing the experience will be similar. Anyway, we will not be making any offers for a while so it probably doesn’t really matter.
Long story short, it’s getting real, real tight out there which should acclerate price delcines. We are going to eventually buy, and are essentially waiting for the bottom (or as close as possible). At some point, it seems prices will come back to normal but financing will not be readily available, that should be interesting. If you are truly interested in buying at some point, make sure you have all your financial ducks in a row ahead of time and you should be able to find a good deal.
On Fox TV few minutes ago,
Swat police team action in Parsippany NJ. It seems some shooting happened. The school supposed to be have been closed. The action is on Kingston Road in Parsippany.
PARSIPPANY, N.J. – Police have converged on a home on Kingston Road in Parsippany after reports of a shooting.
News 12-New Jersey reports dozens of homes are evacuated and the Lake Parsippany School and two day-care centers are closed. The cbale channel says police have gathered outside one home.
Police have not released any information.
A message on the school district’s Web site said due to a “police situation” the school is closed and students would be bused to another elementary school for classes.
To all home sellers mired in debt…
Cash is King! I’m digging in my heels. I’ve got plenty of cash and will ride it out in my rental. I’ve got over 40% downpayment for a home in my price range. I only plan to use about 20-25% for my home, the rest will sit in a rainy day fund. I will wait it out and slowly buildup a bigger cushion. Should have close to 50% by the end of the year.
Sorry. Just had to let that out as I checked GSMLS and we’re approaching 36k in inventory and prices for the ones that are sitting are still ridiculously high. Some of these homes I’ve seen sitting around for over a year. It is now almost May and spring selling season sure is looking like it is a washout.
“More capital hikes and dividend cuts (are) coming as our credit deteriorates and forward earnings decline,” [Morgan Stanley] analysts led by Betsy Graseck wrote in a report. “We think we are only in the third inning of the credit cycle and expect this credit cycle will be worse than (the slump in) 1990-91.”
I saw a gas station this morning with the price for regular at $3.47. The news now is dominated with food shortages, truckers protesting fuel prices convoy style, inflation, credit deterioration and job layoffs. Sounds almost apocalyptic, doesn’t it? But, thank goodness we’re insulated here in Northern Jersey as I’ve been told numerous times by professional members of the National Association of Realtors.
Did you know that Bergen County’s population is growing by 10% per year? And did I tell you that it’s very competitive here? And did you know that in towns like North and West Caldwell the party never stopped and houses are selling at the same rate as in 2005? A professional realtor told me that just two weeks ago.
Anyone have any info on the validity of Homes.com?? I entered “recent sales info” for my immeadiate area and I was SO surprised to see the closing prices they have listed there…they just seem so incredibly high..could this be a real estate site that has its own agenda…the POS by my house sold for …what?! Could this be right? If it is right than the realtors are pricing houses by the comps in the area..and according to this site houses are selling…
http://www.maltzauctions.com/real_estate_detail.php?ID=381071
ok so a 45 acre small house for sale in bankruptcy in NJ, says you can bid but does not give a price, how much would you bid for something like this?
As they say in the subprime loan that 417 is 487 for buyers.
Last Spring agents were telling me prices in Somerset Hills area were going to soar as Verizon moved employees to the area. Well it’s now 1 year later and listing prices are down 10 to 20%.
As lending standards tighten and food and energy increases housing prices have just begin to circle the drain.
Any predictions on what month on the Schiller index we will see double digit YOY declines?
Does anyone have general idea of Construction cost for 2600 sqft (4 br, 2.5 bth + bsmt) Single Family Colonial house in CNJ area?
Some good reasons to live in NJ
The first officially recorded baseball game in history was played at the Elysian Fields, Hoboken, New Jersey, with the New York Base Ball Club defeating the New York Knickerbockers with a score of 23-1. Alexander Cartwright formalized the rules and umpired.
The first intercollegiate football game in history was played in New Brunswick, New Jersey on November 6, 1869, with home team Rutgers University defeating Princeton University 6-4. Rutgers University is considered “The Birthplace of College Football.”
The properties in the United States version of the board game Monopoly are named after the streets of Atlantic City.
The four-mile (6 km) long Boardwalk in Atlantic City was the world’s first boardwalk and is still its largest.
Al (91)-
Welcome to the brave new world of mortgage finance.
grim (59)-
“I wonder if Realtors will eventually realize that defending high home prices is having a negative impact on ‘deal flow’.”
I really now believe that no Realtor understands anything until a hook is sunk into his car bumper.
I noticed at open houses last spring at least 10% of the open houses I went too were agents of big firms trying to sell their own home.
Is that trend continuing this year? Is that normal to have so such a large percentage of houses being listed by the owner/agent.
33.Clotpoll Says:
April 29th, 2008 at 8:42 am
confused (31)-
As in, in the end we’re all dead?
History Channel (H.C.) showed 1. Mayan Calendar ending 12/22/2012, 2. Current Pope as last Pope listed from 13th Century, 3. Numerous etc. Conclusion was 12/22/2012, “Game Over”. Was an interesting show. Made me stop thinking about outliving my money. It will really hurt the Port Authority Police, who were looking forward to retiring on their $200K O.T Pensions, with Full Medical. Us Peon Private Sector folks have less to loose. The H.C. date probably coincides with the upcoming brewing Food & Energy Wars.
Clotpoll Says:
April 29th, 2008 at 12:15 pm
Al (91)-
Welcome to the brave new world of mortgage finance.
Hey it is still better than “IPOTEKA” (Lending) the russian way. Banks in Moscow are lending money at 30% interest (official inflation I bel;iebe is at 12% – dollar /ruble did not change in a year – actually dollar was 30 rubles 3 years ago – now I think it is 24).
Funniest part – if you do nto pay your loan they are not only throwing you ont he street but will aslo send a loan-sharks to make sure that you are broke and dirt poor, thery will take not only your car, but also your TV, clothes and other personal belongings.
Thats the “Lending Soviet Style” – technically illegal, but even biggest russian banks are doing this.
#40 Grim,
What made me laugh is that analysts were expecitng countrywide to earn 2 cents a share. Instead it lost $1.60 a share.
Analysts are as clueless as economists.
“Analysts are as clueless as economists.”
bairen,
Carnival barkers.
Actually that is also lending USA style, the moment you come out of bankruptcy you get credit offers left and right because for the next seven years you can’t wiggle out of debt via bankruptcy and stuff like your primary home, tools, primary car etc. are fair game to snatch.
Laurie [106],
Their objective is to present data in a manner that maximizes their ability to extort and bilk as many as possible for as much as possible. Period. Do your own research and find all sales not just those presented to you. Also remember that you, the buyer, set the price not the sales associates and not the sellers.
Take comparative sales for similar houses in the area that you’re interested before the bogus run-up in prices began, which is roughly 1999, and calculate an appreciation of roughly 4% annually. This is the true market value, not the laughable nonesense the house pushers and their “clients” are trying to exhort.
BOA is doing the CFC deal come hell or high water the bad news today is a good opportunity to buy below par high yielding CFC bonds. Go BOA!!
So, the Fed is expected to make a 1/4 point cut. Who wants to bet they make a bigger one in an attempt to get some bit of a bounce in the market, regardless of how shortlived? And if they do, what is the consensus, 1.75 greenbacks to the Euro?
John Says:
April 29th, 2008 at 12:38 pm
Actually that is also lending USA style, the moment you come out of bankruptcy you get credit offers left and right because for the next seven years you can’t wiggle out of debt via bankruptcy and stuff like your primary home, tools, primary car etc. are fair game to snatch.
I have very little experience with collection agencies in US – do they break your legs if you do nto pay – and rub you broken bones together to make sure you did not hide any valuables from them??
Shore Guy Says:
April 29th, 2008 at 12:42 pm
So, the Fed is expected to make a 1/4 point cut. Who wants to bet they make a bigger one in an attempt to get some bit of a bounce in the market, regardless of how shortlived? And if they do, what is the consensus, 1.75 greenbacks to the Euro?
I would not be surprised to have no cut at all.
Rate is already below official inflation. more rate cuts will greatly accelerate 200$ oil and destroy economy a lot more surely than credit crunch.
#124 regarding rate cuts
We need a Paul Volker.
Instead we get a Paulie Shore.
140: bairen
How can CFC miss their earnings estimate by $1.60!! and still be up on the day. The street must have real faith that this BOA deal is going to go through.
This is funny. This house is put on Craigslist for $649900. And the details say, they had offers at $689,900. Why the heck you didn’t sell it than !!!
http://cnj.craigslist.org/rfs/658155178.html
We are listing the house the same as recent listing with realtor as this is a good market price.Was $689,900 (we have had offers exceeding listing price)
We will entertain all offers from pre approved buyers. Somebody is going to get a great deal on this house but you have to come look and see for yourself.
#122, Let’s hope the Fed grows some B*lls and does nothing and signals that increasing rates are coming soon. But the way they have acted so far, they won’t be content until 25% of the free world is starving and oil is at $150.
[107] John:
http://www.maltzauctions.com/real_estate_detail.php?ID=381071
ok so a 45 acre small house for sale in bankruptcy in NJ, says you can bid but does not give a price, how much would you bid for something like this?
What would you bid….
If you knew it was on a major highway…I’m talking MAJOR highway, tons of truck traffic, a major thoroughfare to the western part of the county/state.
and is in the Highlands Planning Area with a Land Use Capability of “Conservation Environmentally Constrained Subzone”…
So, the Fed is expected to make a 1/4 point cut. Who wants to bet they make a bigger one in an attempt to get some bit of a bounce in the market, regardless of how shortlived? And if they do, what is the consensus, 1.75 greenbacks to the Euro?
Shore,
I’ll bet with you. Grim can hold on to the funds. Since you’re a big time rich guy we’ll make it 100K minimum.
What you say?
I think 50bps with a we are done speeech and some inflation comments with we are ready to jump back in and raise is necessary if their is inflation is a good thing.
we are getting 25bps and a no change next time speech why we wait and see. It is a good thing food and energy costs are not counted as inflation.
Can someone please give the information on MLS#: 2511317.
How long has it been listed.
When did the seller buy and how much did the seller pay.
Street address?
Thx,
CC
Houses are not selling my friend listed her ho ho kus house last week. Realtor threw a realtor only open house (as if a customer would be turned away), had good turn out but resulted in no leads Then realtor showed it to the one and only customer she has and that was it, then friend asked if she would do a open house and realtor said maybe another open realtor open house. Friend said that is ok after you do a regular open house at least once. Friend knows open houses are not always successfull but feels you should at least get one open house with a realtor. Sounds like realtor don’t want to sit in empty open houses or pay for expensive ads when no homes are selling but that creates a catch 22 of even lower sales. Sad thing is spring selling season is over in four weeks.
The Great Bond Insurance Cover-Up
http://www.moneyandmarkets.com/Issues.aspx?The-Great-Bond-Insurance-Cover-Up-1707
Our nation’s largest bond insurers are collapsing as we speak, but Wall Street’s leading rating agencies are covering it up while regulators look the other way.
Zeitgeist…
From an Email sent by GSMLS:
Lender Owned has been added as a choice for the Listing Type field for all property types. This choice should only be used when the lender has completed foreclosure on the property.
First Newark, Now The Hamptons:
http://www.nypost.com/seven/04282008/news/regionalnews/copper_crooks_hit_hamptons_108467.htm
John Says:
April 29th, 2008 at 1:28 pm
I think 50bps with a we are done speeech and some inflation comments with we are ready to jump back in and raise is necessary if their is inflation is a good thing.
we are getting 25bps and a no change next time speech why we wait and see. It is a good thing food and energy costs are not counted as inflation.
John,
Bergage has never disapointed the street and gave them exactly what the futures said he would. It’s 25BP now and that’s exactly what he’ll deliver. The twist is gonn abe that it’s not unanimous. Thats all.
This stimulus package is definitively gonna stimulate. It’s gonna stimulate Inflation. This is a dangereous precedent they have set as its now a direct way to put cash in consumers hands as opposed through the rate cuts which takes time to run through th eeconomy.
In Sept this year the morons in Washington under Bush and Paulson will put together another bigger and better stimulus package and this will send oil up to 150-175 range and Gold back to $1000+ levels.
We will blame everything on subprime, chinese, and the friggin Indians.
Can’t blame the Mexican’s anymore when they can’t afford to live here!
Could have sworn that the last two fed decisions were not unanimous as well with last meeting having 2 dissenters.
Bergabe will cut by .25 and nothing else new. Same language and all. He wants to keep what few options remain open. He is almost shooting blanks. Will also mention the tax rebates and a wait and see on their impact.
#135 Grim
Does this mean you can now count (or list) all the REO’s in BC going forward?
RentinginNJ,
I recently moved from NYC (Brooklyn) down here to South Florida (Ft Lauderdale). I check out this site almost daily, as I was orgininally thinking of purchasing a house in Maplewood back in 2006 (so glad I didn’t).
You have NO IDEA how bad the market is down here… real estate and the general economy. I’m so thankful I didn’t buy here when I moved. For $1800, I have a single family house with our own swimming pool, private yard, in a nice neighborhood. Perfect for me, my partner and the dog! My landlord paid $450K for this place in 2005… which is now worth (at best) $300K. $450K in Flordia = $9K in taxes; insurance… forget about it… at least $5-$8K/year b/c of hurricanes.
The big issue here, IMO, is that the locals can’t afford these places, even at discounted rates, because the jobs in South Florida don’t pay well or are non-existent! And, secondly, the 2nd homeowners are done buying. That market has dried up given what’s going with inflation. So that leaves the foreigners, who are keeping Miami going to some extent (Russians in particular).
It’s a crazy place down here! I can’t wait to get back to the Northeast… but continue to rent! I have never been so proud of any decision I made as I am with not having gotten sucked into that whole housing upward spiral!
ok, my grammar and spelling was pretty bad in that post. bear with me, i was multi-tasking!
Any idea why home prices here in northern NJ have not been coming down as rapidly as other parts of the country?
I’m a bit perplexed, though I suppose we didn’t have quite as huge of a surge of new building like those places. The price increases between 01-06 were staggering, though. Houses that were worth 150K in 2001, peaked at around 450K+ in 06. Now they are down in the 350-375K range, but that is still way high compared to rents (~ $1200/mo.) and median incomes (65K).
The question in NNJ is whether prices will come down or rent will go up? Speculate all you wish, no one really knows what will happen.
Keith Says:
April 29th, 2008 at 2:35 pm
Any idea why home prices here in northern NJ have not been coming down as rapidly as other parts of the country?
I’m a bit perplexed, though I suppose we didn’t have quite as huge of a surge of new building like those places. The price increases between 01-06 were staggering, though. Houses that were worth 150K in 2001, peaked at around 450K+ in 06. Now they are down in the 350-375K range, but that is still way high compared to rents (~ $1200/mo.) and median incomes (65K).
There are few overstatements – prices were higher than that in 2001, rents are higher than 1200 now – try finding decent 3 bedroom apartment for 1200?? In addition if houses did came down to 350-375K range from 450K+ – it is wopping 22% decline in just one year. Just wait ont more year and in the same 22% will apply – 350K house will be sold for 280K.
Low enough for you?
19 clot
Jeebus. If I didn’t know better, I’d think Gross had a buncha money tied up in MBS.
Would anyone else care to answer Keith’s question in post #143?
[i]There are few overstatements – prices were higher than that in 2001, rents are higher than 1200 now – try finding decent 3 bedroom apartment for 1200?? In addition if houses did came down to 350-375K range from 450K+ – it is wopping 22% decline in just one year. Just wait ont more year and in the same 22% will apply – 350K house will be sold for 280K.
Low enough for you?[/i]
I do see 2 bedroom apartments going for $1200 quite frequently. Three bedrooms are usually ~$1500.
Good point about the monster 22% decline, but still, salaries in this area have barely budged since 2000, while housing prices are still more than double what they were in 2000.
Off Topic: How the heck do I italicize text here? I see that the [i] [/i] tags don’t work…..
“” are the tags here
My post did not work like expected. may be this will > = tag
From Bloomberg:
More Subprime, Alt-A Mortgages May Head `Underwater’
About half of subprime and Alt-A mortgages made in 2006 and 2007 may be “underwater” or close to it by midyear, putting about $800 billion of debt at greater risk of default, according to Barclays Capital.
Subprime loans that exceed the value of the related homes jumped 5 percentage points to 19.8 percent in the fourth quarter, and may reach 26 percent if property-price drops continue at the same pace, New York-based analysts Ajay Rajadhyaksha and Derek Chen wrote in a report yesterday. Such Alt-A loans, a grade better than subprime, would grow to 23 percent from 16.3 percent.
Many of the loans are in areas where prices are falling faster than the U.S. average, so the size of the shift is underappreciated, the Barclays analysts wrote. The odds that a borrower will default, saddling lenders and bond investors with losses, rises when a homeowner owes more on a property than it can sell for, they wrote.
“Mortgage loans are moving underwater at a very sharp pace, far more than suggested by aggregate home price data,” they wrote.
Keith,
Use instead of [] for italics. And you’re exactly right about the salaries as a ratio to house prices. It proves beyond a doubt that it was all a lie, all a scam and I constantly ask realtors other than those who post here, to give a plausible explanation how that’s possible.
And they won’t explain it because it can’t be explained unless they’ve come up with a new set of laws to replace the ones Newton established a long time ago.
italics – use the greater than and less than signs.
kieth
use tags instead of []
kieth use
use the greater then and less then symbols, not brackets…..
Thanks!
And you’re exactly right about the salaries as a ratio to house prices. It proves beyond a doubt that it was all a lie, all a scam and I constantly ask realtors other than those who post here, to give a plausible explanation how that’s possible.
And they won’t explain it because it can’t be explained unless they’ve come up with a new set of laws to replace the ones Newton established a long time ago.
Yep, something has got to give.
grim clott anyone,
can someone tell me what the home equity market is looking like. An elderly family member here in NJ may need to either sell or pull a home equity loan for living expenses. They are in a nursing home and the home is completely paid for with no outstanding debt.
OT, but amusing. And a good reminder, that no matter how big our problems, somebody has it worse:
http://news.yahoo.com/s/nm/20080423/od_nm/witchcraft_dc;_ylt=AsLVVNtFvNUUt_Z9AzsjBKis0NUE
” P*nis theft panic hits city..
” KINSHASA (Reuters) – Police in Congo have arrested 13 suspected sorcerers accused of using black magic to steal or shrink men’s p*nises after a wave of panic and attempted lynchings triggered by the alleged witchcraft.
Purported victims, 14 of whom were also detained by police, claimed that sorcerers simply touched them to make their g*nitals shrink or disappear, in what some residents said was an attempt to extort cash with the promise of a cure.
…
“I’m tempted to say it’s one huge joke,” Oleko said.
“But when you try to tell the victims that their p*nises are still there, they tell you that it’s become tiny or that they’ve become impotent. To that I tell them, ‘How do you know if you haven’t gone home and tried it’,” he said.”
test
lissosh,
isnt that the sane crowd as the one here in the US that believes that Harry Potter is going to teach children to become evil wizards and witches???
or that SpongeBob Squarepants is gay?
I wonder if more and more potential suburbanites will be lured into Newark, with all of the new condos going up there and the lower cost compared to the burbs like Lyndhurst, Nutley, Clifton, etc.
Couple that lower cost with the (admittedly) slow revitalization of Newark, and perhaps there is a chance that it will begin to reverse decades of stagnation and decline.
grim –
Not being demanding, but wanted to see if there is a Lowball! in the works for this month. Need my fix…
I hit a couple of open houses this past weekend. The first place wasn’t bad. The second place was funny – listed well above other comps, featuring a mirrored dining room that looked like a fun house hall of mirrors, horrible thick green carpet in the living room, a second bedroom done up for a teenage girl in day-glo paint, wallpapered bathrooms, and a basement that while finished, smelled of mold and must. No mens’ clothes in the master BR leads me to believe she’s a divorced single mom.
The lady selling the place had left a printout of her resume at her workstation. Her employment history stopped in June 2007. Last place of employment: Home Depot, as a sales associate in their corporate and contractor sales group. Hopefully she pocketed some commissions from all those granite orders she booked for contractors.
Lawrence Yun: “I doubt prices will or need to fall in the vast middle America. Indianapolis, Dallas, Kansas City, Omaha are, if anything, underpriced markets.”
By Jody Shenn
April 29 (Bloomberg) — About half of recent subprime and Alt-A borrowers may soon owe more on their mortgages than their houses are worth or hold minimal equity, putting $800 billion of debt at greater risk of default, according to Barclays Capital.
Subprime loans from 2006 and 2007 that exceed the value of the homes jumped 5 percentage points to 19.8 percent in the fourth quarter, and may reach 26 percent by midyear if prices drop at the same pace, Barclays analysts wrote in a report yesterday. Alt-A loans, a grade better than subprime, would grow to 23 percent from 16.3 percent.
Larry Yun is such a spinmaster he would take the sentence that “home inventories are swelling” and turn it into the “housing market is swell” why do you guys even listen to him.
anyone have details on 2508303 in livingston…
seems underpriced ? also pictures seem to show no appliances , possible flip gone bad?
thanks…
I thought this was interesting, from Patrick.net:
Why are banks not selling their foreclosures?
April 28th, 2008
http://patrick.net/wp/
Al (116)-
What, necessarily, is wrong with taking someone’s earlobes as collateral…when the taking of earlobes is indicated as necessary by a competent underwriter? :)
#144 NJJThe question in NNJ is whether prices will come down or rent will go up? Speculate all you wish, no one really knows what will happen.
We already know that prices are coming down.
Curious about the listing price of 79 Claremont Rd, Franklin Somerset. Just saw the sign go up but can’t find the listing.
I’m not interested in the house, but it sold for $339,000 in 2006. I would think that it would be hard to list for more, there are bigger houses across the road listed for less.
#171, don’t know if it is a flip, but there is a power line tower in the back yard, yup, not just power lines, but also a power line tower. Thus the low price.
If you can afford it, 2511352 is a good value for the money.
144
# NNJ Says:
April 29th, 2008 at 2:43 pm
The question in NNJ is whether prices will come down or rent will go up? Speculate all you wish, no one really knows what will happen.
We are guaranteed that prices are coming down. There is no more funny money credit to support current prices and the level of inflation to support such prices would ignite hyper inflation and wipe out the economy at any rate.
be patient, housing does not move like the stock market. it takes years for changes to move through the housing market as real estate is highly illiquid generally speaking, especially in todays market.
At the same time we could also see rents drop overall while there are local increases. If inventory stays high and people continue to put homes up for rent when they dont sell then we will see more downward pressure on rent. at the same time desirable urban areas such as montclair etc could continue to see increases.
The rent idea is just an opinion, the housing price decline is a certainty!
MLS ID# 2487497
looked on tax records, is this 96k less than 2005?
Summit
Pat, or any other Bucks County folk –
Random question, because I’m not about to turn to Craig’s List: Looking for a cleaning person. Any ideas?
We are just stunned by how much more real estate we have in this townhouse than Manhattan, and with both of us working, and a crowd coming in for Mother’s Day, we’ll never make it.
Can anyone recommend a cleaning service (In Bucks County, PA) they’ve had a good experience with?
Numbers Racket
Why the economy is worse than we know
KEVIN PHILLIPS
Harper’s Magazine v.316, n.1896 1may2008
If Washington’s harping on weapons of mass destruction was essential to buoy public support for the invasion of Iraq, the use of deceptive statistics has played its own vital role in convincing many Americans that the U.S. economy is stronger, fairer, more productive, more dominant, and richer with opportunity than it actually is.
The corruption has tainted the very measures that most shape public perception of the economy—the monthly Consumer Price Index (CPI), which serves as the chief bellwether of inflation; the quarterly Gross Domestic Product (GDP), which tracks the U.S. economy’s overall growth; and the monthly unemployment figure, which for the general public is perhaps the most vivid indicator of economic health or infirmity. Not only do governments, businesses, and individuals use these yardsticks in their decision-making but minor revisions in the data can mean major changes in household circumstances—inflation measurements help determine interest rates, federal interest payments on the national debt, and cost-of-living increases for wages, pensions, and Social Security benefits. And, of course, our statistics have political consequences too. An administration is helped when it can mouth banalities about price levels being “anchored” as food and energy costs begin to soar.
The truth, though it would not exactly set Americans free, would at least open a window to wider economic and political understanding. Readers should ask themselves how much angrier the electorate might be if the media, over the past five years, had been citing 8 percent unemployment (instead of 5 percent), 5 percent inflation (instead of 2 percent), and average annual growth in the 1 percent range (instead of the 3–4 percent range). We might ponder as well who profits from a low-growth U.S. economy hidden under statistical camouflage. Might it be Washington politicos and affluent elites, anxious to mislead voters, coddle the financial markets, and tamp down expensive cost-of-living increases for wages and pensions?
Let me stipulate: the deception arose gradually, at no stage stemming from any concerted or cynical scheme. There was no grand conspiracy, just accumulating opportunisms. As we will see, the political blame for the slow, piecemeal distortion is bipartisan—both Democratic and Republican administrations had a hand in the abetting of political dishonesty, reckless debt, and a casino-like financial sector. To see how, we must revisit forty years of economic and statistical dissembling.
continued:
http://www.mindfully.org/Reform/2008/Pollyanna-Creep-Economy1may08.htm
Not being demanding, but wanted to see if there is a Lowball! in the works for this month. Need my fix…
Will do
looked on tax records, is this 96k less than 2005?
Summit
I’m sure someone will chime in about how it isn’t in the right part of Summit.
Purchased: 4/15/2005
Purchase Price: $495,000
Current Asking: $399,000
I thought Bill Gross was supposed to be smart? He refers to fighting on the Maginot line in WWI when it was constructed as a result of WWI. What a lightweight.
kettle [180],
The core rate was devised to smooth out the volatile/temporary movements in price for food and energy. Well it’s been a slow steady, stair steps up, 6 year rise. Where’s the temporary volatility?
It is mind boggling, at least to me, that you have to “qualify” to be included in the unemployment rate. Those that are part time [because they can’t find a full time job], discouraged workers and the marginally attached are not a part of the official tally. It’s our govt’s off balance sheet accounting, utilized to mask the real #’s.
watched that movie the other night “American Gangster” w/ Denzel Washington & Russel Crow
thats a damn good movie.
let me tell you blokes a thing or two, although a hollywood movie, that backbones to that story is damn accurate.
When I was in the service during that time, I saw military smuggling all sorts of drugs into this country. Yes, it still goes on today.
You know how much drug money ends up on Wall St? Hundreds of Billions!
There was a great line from that movie” “if the drug trade was legal, alot of people would be out of work”
Whats that have to do with NJ RE? not a whole lot, but if all the drug money was…puff… gone overnight, the DOW and your 401k would go bye.. bye..
i.e. the Red Button problem. would you press that button?
: )
SAS
sas,
Just a different flavor of sovereign wealth fund.
#124-130
What I said was more a question than a statement, nuance gets lost in text. I am all for a strong dollar and hate these recent rate cuts. It just seems like Big Ben is more afraid of a bad reaction on Wall Street than he is in a weak dollar, even if the weak dollar drives up energy costs.
One larger than or equal to Abu Dhabi Investment Authority.
Not including, prison systems, police, LE equipment.
SAS
Shore,
Welcome back. Feel like loosing 100K?
thats why I’ve always called for legalization.
and no, I ain’t no tree huggin hippee with sandals, a plaid shirt, doin the hula dance.
: )
SAS
“It just seems like Big Ben is more afraid of a bad reaction on Wall Street than he is in a weak dollar”
Shore Guy [187],
Bergabe panicked on Socgen Tuesday, cutting .75, approx 10 days before the next fed meeting. It was simply a prop for the markets. Funny thing, the BOE or ECB didn’t budge regarding the news of the rogue trader.
[182] Grim,
Spouse informs me that there is a side of town called “Slummit.” We aren’t even talking Mt. Laurel housing here, rather it has always been so.
On an unrelated note, I have taken the plunge in Westfield. OLP was 669, UC at 643. Doesn’t make for a comp killer, I guess, but I am in the pool.
Thanks to all on the Board for their input and info, esp. Grim.
Seeking, are you formerly blood?
I know some folks with good cleaning teams. I’ll get the info and send it to JB. I’m a do-it-yourselfer.
Do you eat Indian food? We’re pretty lacking around here, but my husband and I went to Asian Garden on Sunday in the Giant Plaza on Stoney Hill. They just opened and they’re trying to attract the non-spicy crowd, so you have to tell them Indian spicy for the real thing. But the buffet was good for seven bucks. Full menu, too.
Oh..someone I know uses Maid Brigade. Their house seems clean to me.
Anyone have a link on gsmls that provides details such as ‘Dom’, ‘UCD’, ‘UCP’, address, exclusions etc. I used to have such a link until gsmls redid the website.
# 189 Make,
I am so cheap that I don’t even enter office pools or buy a lottery ticket when the prize tops $100 million, so I will pass on your wager.
# 189 Make,
I am so cheap that I don’t even enter office pools or buy a lottery ticket when the prize tops $100 million, so I will pass on your wager.
I used to have such a link until gsmls redid the website.
As far as I know, there is no longer a back door.
Ask here, or email me.
Pat – Many thanks. Hopefully JB will email it to me … i’ve sent him a note before, but he didn’t respond. But yes, formerly blood. sick of the 07 in my handle!
Never used a cleaning team/person, but we want the new place to look nice and we’ll be out of town this weekend, plus cooking for about a dozen, so it’s not a top priority.
LOVE Indian food. I went to Curry in a Hurry on 29th street in Manhattan every other week. So good. I will look the place up. Thanks for the advice!
(160) Kettle1
Regarding your elderly relatives – I think that is exactly the scenario the reverse mortgages were intended to service. There is even such a thing as a reverse mortgage line of credit. You only have to take it out for as much as you need and (Grim or Clot would know tons more) but…I think
the paper work aspect would be much easier if they went that route vs. a loan.
Maybe someone out there knows more about it..worth checking though.
From the Star Ledger:
J&J combines biotech sales forces, plans 400 job cuts
Johnson & Johnson yesterday notified employees it will consolidate the sales and marketing operations of two subsidiaries, Ortho Biotech and Centocor, leading to roughly 400 job cuts nationwide.
The move is a response to the declining sales of a class of anemia drugs that includes Johnson & Johnson’s Procrit, a company spokesman said. Prescriptions for Procrit fell sharply last year after the Food and Drug Administration placed new safety warnings on the drugs, known as erythropoiesis-stimulating agents.
“It is important that we take these significant and difficult steps in our business to free up resources that can be redeployed to opportunities that will make the greatest difference to patients and to our own future success as a business,” Kristine Peterson, J&J’s company group chair for biotechnology, immunology and oncology, said in an email to workers.
Ortho Biotech’s commercialization operations had been based in Bridgewater but will shift to Centocor’s headquarters in Horsham, Pa. About 150 of the 400 layoffs will fall in New Jersey, the spokesman said.
Somebody sent JB a note and he didn’t respond. What?
Yikes…do you think he got one of those donate compare programs set up to filter e-mails against donations?
If I missed something, it wasn’t intentional.
grim Says:
April 29th, 2008 at 7:58 pm
If I missed something, it was an accident.
Obviously, man. No worries. You’re big-time. And the blog is fantastic.
Too important to wait until Friday:
S&P cuts $41 bln of mostly higher-rated Alt-A deals
Standard & Poor’s cut the ratings on about $41 billion of mostly higher-rated U.S. residential mortgage-backed securities backed by so-called Alt-A loans on Tuesday.
The rating agency’s action affected 2,183 RMBS classes from 334 Alt-A deals originated during 2006. S&P cut $5.86 billion of “AAA”-rated debt, while keeping $58.16 billion under review for possible downgrade.
S&P said it will assess whether further rating actions are warranted on the “AAA” securities placed under review by analyzing available credit support to projected losses during the timeframe issues remain outstanding.
…
The rating agency also cut $4.65 billion of “AA+” Alt-A RMBS ratings, $8.09 billion of “AA” issues, $2.72 billion of “A+”debt and $1.46 billion of “A-minus” issues.
I’ll pass the info on as soon as I get it from Pat.
“Standard & Poor’s cut the ratings on about $41 billion of mostly higher-rated U.S. residential mortgage-backed securities backed by so-called Alt-A loans on Tuesday.”
What was Bill Gross barking about in his newsletter?
Cindy (200)-
On the first hearing of that situation, I thought a reverse mortgage or reverse LOC would probably be the solution.
More conventional loans might be harder to obtain if they’re not working or otherwise generating income.
From Bloomberg:
S&P Downgrades, Reviews $41 Billion of Alt-A Bonds
Standard & Poor’s downgraded or put on review ratings on $41 billion of debt backed by Alt-A home loans, citing a jump in defaults since the beginning of the year.
Ratings on 2,183 classes of securities created in 2006 were lowered, according to a statement today from the New York-based unit of McGraw-Hill Cos. The firm put 487 AAA classes of the bonds under review for downgrades.
The cuts are S&P’s most extensive among bonds backed by Alt- A loans, considered between subprime and prime. Serious delinquencies, or payments at least 90 days late, on Alt-A loans in 2006 bonds rose to 10.6 percent as of March, a 55 percent rise from December, S&P said. The announcement represents the “last major changes” for these types of securities, S&P said.
The firm will next study 2007 Alt-A securities and announce the results “in the next few weeks,” S&P analysts Scott Davey and Ernestine Warner said in the statement.
…
Moody’s Investors Service has also picked up its downgrades of Alt-A mortgage securities, cutting more than $10 billion of the debt created by Countrywide Financial Corp. last week. Moody’s also lowered bonds issued by Wachovia Corp., Wells Fargo & Co. and the bankrupt American Home Mortgage Investment Corp.
…
About half of borrowers who took out Alt-A loans in 2006 or 2007 may owe more than their home is worth or have less than 10 percent equity by midyear because of declining property prices, boosting the odds they’ll default on about $400 billion of loans, according to a Barclays Capital report yesterday.
The U.S. housing decline is also worsening credit quality for Alt-A securities by making it harder for defaulted loans to be purged from pools, S&P said. The longer it takes to sell a foreclosed home, the more property values may decline, and the longer the company managing payments and collections must advance the interest due.
“Due to current market conditions, we are assuming that it will take approximately 15 months to liquidate loans in foreclosure and approximately eight months to liquidate loans categorized” as already turned into seized property, S&P said.
Regarding reverse mortages:
I advised my parents against. I felt it would be better for them to sell the house, move to an apt and let the interest pay most of the rent. As it is now the house is losing value, and they are putting out money for taxes, insurance,repairs and higher energy bills to the tune of about $1400. per month. If they bank the money in a safe CD at 3% they will generate about 875.00 per month in interest. They could easily get a 2 bedroom w/parking and heat included for 1100.00 per month, Am I off base here?
KL
(210) rhyming
Don’t look at me! Clot or Grim would know.
I only mentioned the reverve mortgage in Kettle’s case because he said “home equity market” and didn’t mention wanting to sell.
I had heard that for folks just wanting to cover living expenses AND KEEP THEIR PLACE a reverse mortgage was less hassle than a home equity loan or new mortgage.
#192 Good luck Why did you take the plunge now?
{italics test}
I hope all the home owners who took a reverse mortgage in 2005-2008 get to stick it to the man when they drop dead in 2020 and the bank gets back a worthless house after making 15 years of payments. I am sure the elderly home owners are going to let it go to complete crap considering it is someone elses problem. HA HA, those reverse mortgage people were swindlers anyhow offering you less than it was worth.
(210) rhyming – My mom, 85, sold three years ago and moved into an apartment. She LOVED down-sizing, no yard work etc. but hated all of the “old folks” at the apartments she moved into.
So…She moved to the Sonoma area with my sister (for a new job she took – CEO-Cotati Grange Credit Union) – But mom hated being home alone all day while my sister was at work.
So….she moved into some “senior apartments.” At this point she had shed layers of crap and knew exactly what she wanted….company!
She now throughly enjoys cards when she wants, lunch with the girls, seclusion if she so desires (they have a “central” area and are next door to the Rhonert Park Senior Center.) She couldn’t be happier. My sister?..she bought small and lives two blocks away.
A house in North Brunswick recently went up for sale, listed for a lot more than what the neighbors house sold for last year. Believe it or not, it is already under contract. 3 weeks time. I really believed that the house would stay on the market for at least a few months. In an economy that is down-spiraling, why would anybody buy a house that is more than the comp?
bp 217 There is a sucker born every day.
I just need to vent…
I am really upset.
Last spring I looked at a house for sale. I seller wanted too much – well actually I knew it was too much, but it was well within comps for last year.
I passed the house even though I really like it – nice size, and I cold handle updates. But with high taxes and high price – I would have never have any money left for the updates.
So it sold in September 2007 for 5K over asking. March this year, it came back on the market as REO.
I got exited and went to look at the house today.
THE HOSE WAS TRASHED. NOT ONLY IT WAS TRASHED BUT THERE WERE ANIMALS LIVING THERE AND SEVERE ROACH INFESTATION – WALLS ARE COVERED WITH ROACH POOP!!!
So instead of nice house bank is now 60K (if house sells for asking which i strongly doubt it will)under, house is trashed @ssholes who stole money from bank and taxpayers are walking away free.
Yea we need freaking bail-out. Right now I really hate real estate in it’s current form. I know it is going all all over country, and I am pissed.
I did get pre-approved, but no I am putting my home-buying on-hold, as I did see that lending standards somewhat improved, and current situation is a metastable equilibrium (my dose of dorky words for the might).
It will collapse – but what do I know – once it collapses government will use my tax-money to fix it, and give this hose back to “poor, minority, underprivileged” who stole from lender and trashed it in the first place.
Thats my rant of the night, good night everybody.
Al. Et tu?
Why is everyone so focused on one deal tonight?
This thing is a buffet. If you don’t like the soup, move on to the Naan and dip.
Buy a little REI deal if you find yourself looking at houses. Like some of the new ones betting on bottom. If you’re looking, others are looking, and there are going to be some lil waves to catch.
Off topic but perhaps of use to folks looking for some entertainment (besides watching RE sellers twist in the wind) this August:
http://en.beijing2008.cn/cptvenues/schedule/
This provides a handy chart of which sports are being performed each day of the games.
3b,
Lower cost house in higher end neighborhood, around the corner from decent elementary school in a town ideal for raising a young’un. Lower cost means I can get in with conforming and pay the rest. HELOC for renos comes at lower interest rate and I have it backed with cash anyway, and with effective taxable yield on munis higher than the HELOC, it makes sense to keep the cash.
Bit small for my tastes, but I recently sold a 1400 sqft rowhouse in Philly, so this is larger, to be sure. Also, we figured the house we wanted spacewise would cost us 800-850, so we bought a smaller house that could be expanded. Will spend the same and get the house we want in the hood we want.
Agonized over it to be sure as I am a RE bear, but my time horizon is 15-20 years in this location, and I did not think I would do much better before school starts.
#222 Deplume
High 5 for pulling the trigger.