From Forbes:
S&P/Case Shiller: May Home Prices Rise At Slowest Rate Since Feb. 2013
In yet another sign that the housing recovery is slowing down, the 14-month streak of double-digit, year-over-year jumps in home prices finally ended in May, data from S&P/Case-Shiller released Tuesday shows.
The 10-City Composite Index rose 9.4% year-over-year while the 20-City measure climbed 9.3%. That pace is significantly lower than the rates the indices increased in April: 10.9% and 10.8%, respectively. It is also the slowest rate since Feb. 2013.
To be clear, home prices are still rising–just not as fast as they have been. Economists like year-over-year prices because they give a better sense of the market’s overall direction than do the swings in prices from month to month (compared to April, both city indices gained 1.1%).
…
As of May 2014, home prices are back to their summer 2004 levels, but still about 17-18% off their summer 2006 peaks. All the cities the indices track, with the exception of Charlotte and Tampa, saw year-over-year home prices rise at slower rates than during the prior month.
…
“Nationally, today’s Case-Shiller data is consistent with the slow glide-path down towards a more normal housing market we’ve been experiencing for the past few months,” said Stan Humphries, Zillow’s chief economist. “But the national numbers are masking a lot of variation from city-to-city: Cleveland, for example, is performing a lot differently than the Bay Area.”
How to afford the BC lifestyle, from the Record:
Westwood couple sentenced in $3.4M mortgage fraud
A federal judge on Tuesday sentenced a Westwood couple to prison for fraudulently obtaining millions of dollars in loans from mortgage companies over several years.
U.S. District Judge William H. Walls sentenced Linda Yarleque, 44, to two years, and her husband, Fabio Moreno Vargas, 47, to 18 months. The two must make $716,353 in restitution for the losses assumed by various lenders, and must forfeit $262,000 – the approximate amount they pocketed.
Yarleque said she was solely to blame for the criminal acts, and that her husband was innocent of any wrongdoing. But the two were convicted by a federal jury late last year of one count each of bank fraud and conspiracy to commit wire fraud.
The couple submitted falsified employment and income information to obtain 10 fraudulent loans over a period of three years, according to federal authorities. They also failed to disclose debts and other properties they owned on the applications, and lied about where they lived to receive $3.4 million in mortgages.
…
They obtained about $262,000 through “cash out” refinancing that they directed to their bank accounts. They then spent that money on vacations and cars, and bought more properties.
Vargas and Yarleque were assisted by an unnamed accountant who originated loans processed through the Residential Mortgage Corp., a Ridgewood company owned by the former head of the Bergen County Improvement Authority. Ronald J. O’Malley was sentenced in 2012 to two years in prison for using his position as the agency’s chairman to help boost the private mortgage brokerage company he co-owned.
From Fortune:
Why the housing recovery is over, in four charts
1. Price-to-rent ratios are near their long-term average.
2. Homeownership rates are also near their long-term average.
3. Ratio of housing wealth to GDP has normalized.
4. Paying in cash takes a tumble.
Turned out to be an old fence post, not an vent pipe for an oil tank.
Cost me $100 for the sweep. Worth it for peace of mind.
Hammock is up, thanks for the suggestions.
Next time I see the “uber-inspector” I will still kick him in the shin as he did miss some significant termite damage.
May home price gains continue to show signs of slowing
Gary’s prayer each night?
[2]From the Forbes article:
The fact that the number of cash buyers is declining shows that investors no longer believe that buying residential real estate will continue to provide big returns.
Alternatively, it might show that those with cash are more confident that it will retain it’s purchasing power (no inflation on the horizon) or that housing will no longer serve as the inflation hedge it has been for the last 50 years (taxes?).
Expat,
Waiting for train but let me just say that parabolic price hikes in everything along with flat salaries means that something has to give. The only thing we can control is the price of the houses.
Gary – You’re preaching to the choir. The housing “recovery” in NNJ is nothing but a mirage at decade-plus flat wage levels accompanied by out-of-control tax raises. The boomers will run away from their tax bills when they start paying them out of savings instead of salary and prices will tumble.
Expat,
Waiting for train but let me just say that parabolic price hikes in everything along with flat salaries means that something has to give. The only thing we can control is the price of the houses.
[7] BTW, this will be very simple math for new retirees of the Bergen County flavor who may have the bulk of their retirement assets in 401(k) plans and other such vehicles. Assuming a paid-off or mostly paid-off house, take $500K of free money and live for a few years off of that, or take huge amounts of additional withdrawals from retirement assets, pay the INCOME TAX on that, then use it to pay the property tax on your house. How many years do you think retirees will want to withdraw $30K extra per year to pay their $20K tax bill? My in-laws have to withdraw about $150K per year, pay their income tax, and then use the rest to support their debt-free retirement lifestyle in Warren County, NJ. If they still owned their Bergen County house they would need to withdraw closer to $200K per year as the taxes on their old house are now $33K per year.
First, the article is talking about a national recovery. Did anyone think that those double digit gains would continue in some areas? Really?
This is a good thing. You don’t want prices rising without justification. Aren’t you all against bubbles? I said it numerous times before, prices will rise in northern jersey by 1-3% gains and start taking off towards the end of this decade or beginning of next decade.
The housing market is fine. If there were double digits gains going on right now, I would be scared. The housing market is doing exactly what it is supposed to be doing right now. Holding steady, not rising or dropping significantly in either direction. Keep hoping for a crash guys. Why, you would want that, I do not know.
Now i’m going to be accused of crazy talk.
As soon as they retire, someone will take over their job, and will be able to afford to buy their home when they want to sell. We already went through the cut stage in employment, they really can’t continue to let people retire and not replace them. A lot of these older people that still have jobs are in high paying jobs. The younger generations will embrace the retirement of the boomers. It will be a huge positive for them.
The Original NJ ExPat says:
July 30, 2014 at 8:15 am
[7] BTW, this will be very simple math for new retirees of the Bergen County flavor who may have the bulk of their retirement assets in 401(k) plans and other such vehicles. Assuming a paid-off or mostly paid-off house, take $500K of free money and live for a few years off of that, or take huge amounts of additional withdrawals from retirement assets, pay the INCOME TAX on that, then use it to pay the property tax on your house. How many years do you think retirees will want to withdraw $30K extra per year to pay their $20K tax bill? My in-laws have to withdraw about $150K per year, pay their income tax, and then use the rest to support their debt-free retirement lifestyle in Warren County, NJ. If they still owned their Bergen County house they would need to withdraw closer to $200K per year as the taxes on their old house are now $33K per year.
@WSJ: Breaking: U.S. GDP grew by 4% in the second quarter, rebounding strongly. http://t.co/tYCeEMbSEk
Eddie,
Pay attention to Nom.
Stop focusing on price, and pretend you are a military officer.
Pick your location due to it’s ability to be defended, and the ability of the land to support your family’s basic needs when tshtf.
grim unmod me.
please
Anon [11];
Wow, that means +1.1% for the first half (at least until the Q2 revisions come in). Pop the Champagne corks!!! You didn’t forget the -2.9% first quarter, did you? I know your “Coffee Party” masters hope you did. Baa, baa.
8 – Cognitive dissonance.
Where exactly will someone who “needed” to live in Saddle River paying $30k a year in taxes go? I don’t quite understand the premise that they would consider moving to some third-tier town in the middle of nowhere.
I see exponentially more expat retirees in haughty towns selling their $700k BC houses to buy $700k Scottsdale houses. They aren’t going to Cleveland.
Grim,
Personally, I would love to erect a hammock, plant some fruit trees/vegetables and fish for my proteins somewhere in Central America once my kids are out of high school. Realistically, I will definitely move to a low tax state. For now, it’s only the Glen Ridge schools that keep me there as well as the small town feel and semi-efficient government.
13 – sorry I think you got blacklisted and deleted, I don’t see it in mod
17 – Should have purchased a house in Punta del Este 15 years ago.
That’s how it always is, though holding land long-term in some of these places is very risky as multiple people will claim their land is theirs and the courts are a mess.
Uruguay?
anon (11):
Personal consumption expenditures are up 1.69%. Not too shabby. However, here is the unintended consequence of spending more than you earn:
http://www.zerohedge.com/news/2014-07-29/deadbeat-nation-shocking-77-million-americans-face-debt-collectors
Hmmm….fence post….I like the creation of the paper (digital) trail…smart, very smart, and the subtle comment on the inspection…smarter!
21 – Sure but it’ll cost you a million bucks now
they can live wherever they want at whatever price point they want. My observation is that they move when they no longer need:
1. 5 bedrooms
2. Schools
3. Trains to NY
4. The high tax bills and maintenance associated with 1,2, & 3.
I get your point, though. I know someone who sold a Boston SFH near me for $2.5 million in 2006 (bought in 1994 for under $1 million) and bought a Boston condo in town for $2.5 million, taxes on both are about the same at $15K per year (that’s right $15K in Boston are the taxes on $2.5 million property, not a $600K 2BR 2.5 Bath CHC) but they didn’t need 7,000 square feet, 10 beds, and 6 baths anymore. So now they have 3200 square feet, 4 BR and 3 baths but they have very predictable maintenance which is far less than their previous property. So if you’re wealthy, you may stay in similarly priced digs, I get that.
Now OTOH, if you have mere millions, as opposed to 10’s of millions something like property taxes and high maintenance costs are very huge to someone who is newly retired. Think about it, your property taxes alone in NJ can put you in a higher tax bracket! My in-laws have been retired since the early 80’s but got out of BC expressly to get out from under their tax bill in the early 90’s. Their house in Warren county is comparable to their old house, but they bought it at a cost of half the proceeds of their BC house and at a much lower tax bill. They don’t go anywhere except restaurants for lunch and both their kids live in New England, so why stay in BC just to show the neighbors that you can? It’s not the cost of the house that’s important, because that’s kind of a one time thing, but the price of your monthly nut is going to determine whether your investments grow or become a sinking fund and also what tax bracket you land in. BTW, my FIL’s portfolio grows by about $30K/month so they have lots of options, but they still left to get away from their tax bill.
8 – Cognitive dissonance.
Where exactly will someone who “needed” to live in Saddle River paying $30k a year in taxes go? I don’t quite understand the premise that they would consider moving to some third-tier town in the middle of nowhere.
I see exponentially more expat retirees in haughty towns selling their $700k BC houses to buy $700k Scottsdale houses. They aren’t going to Cleveland.
Ah the American way.
About five years ago, I reported on my friends by the shore who liked to run up their credit cards and then refinance the debt into new 30-year mortgages on their house. Well it looks like they are at it again. They refinanced last year for another 30 years. They owe $415k on a house that they bought for $395k in 2003…..plus they still have 29 years of payments. The Zillow zestimate is $303k. Sadly, they do pretty well for themselves. Certainly not much worse than Gator and I. Of course, they drive fancier cars and buy every iGadget that Apple releases.
In the same period of time, we brought a multi for $480K in 2004, and our new primary in GR for $423K in 2011. We have paid off $250K of them and both homes have been refinanced down to 15 years with both being paid off in 2027, which is right around the time our 19-month old will be heading off to college. We’ll sell one to pay for his and his older brother’s college and we’ll downsize out of the GR home to wherever and will probably retire or find jobs that are more desirable, but less lucrative. Currently our homes are worth over a million when combined.
I hope those fancy cars and iGadgets are worth their having to work well into their sixties. Heck. Their house won’t be paid off until they are 70. Wouldn’t it suck to have to pay the mortgage from the 401K (assuming they have one)?
as opposed to Punta del Este, NJ?
Libturd in the City says:
July 30, 2014 at 9:39 am
Uruguay?
Lib [26];
You friends — whether they know they did or not — simply sold their house in pieces along the way, and pay endless mortgage interest as the cost of pulling their consumption forward. They’ll be like my in-laws, who sold a LI cape that they owned for 35 years and took less than $20,000 from the sale. They liked their cruise, though.
When I was house shopping I used to see dilapidated houses with neglected and deferred maintenance listed at top of the market prices. What these people didn’t realize is that they already sold their house, or at least part of it, when they decided not to fix whatever obviously needed fixing. Instead of paying for the repair, they reduced the value of the asset, same net effect as if they ‘sold’ a piece of it at the time.
I don’t think they know it. I can’t even ponder the thought of paying 12 to 20% more on everything I purchased due to credit card interest, and then paying another 5% (if they are lucky) annually for it over 30 years. All of a sudden, that $600 iPhone cost them $2,500 and they wonder why they can never save.
Lib [26] I have a long-time work acquaintance who does the same thing. They have always had loaded first and second mortgages to the tune of about $450K, taking out a new mortgage whenever they can. He just turned 61.
I asked him a while back, “Earle, you’re almost 60, when do you plan to pay off your house.”
His answer, “Oh, it will never be paid off. A house is just a place to live.”
“Oh, it will never be paid off. A house is just a place to live.”
Earle may just be smarter than the rest of us. But only if his 40 years of mortgage payments plus carry costs would total up to less than he would have paid in rent over those same 40 years.
26 Lib,
it catches up with everyone. My parents were bringing in 500k a year but borrowed so much into the future that the second he had a bad year (250k a year), the jig was up. All his properties went into foreclosure.
“Oh, it will never be paid off. A house is just a place to live.”
So, when he goes to sell the house and is offered 80% of his asking price, he won’t be insulated because… a house is just a place to live, right?
Ben [32],
Please explain this concept to the people on this forum that think a certain postal code is automatically associated with wealth.
Outside of my mortgage, I don’t borrow. It’s too expensive. Unless of course it’s one of those 0% credit card offers. I do them all the time.
@AP: BREAKING: Palestinian official: 15 dead, more than 150 wounded in strike on busy Gaza market.
Lo and behold, they just listed that CHC I saw last week for (drum roll)… $45,000 less than the original asking price! Hmmm…. the plot thickens! A center hall in the most desirable section of said town and no one bites? Michael, where’s the wage inflation? Where’s the high rollers burning $100 bills?
Eddie – put in a bid another 75 less.
Ah, here comes another beautiful, vibrant default by Argentina:
http://www.bbc.com/news/business-28558121
Juice [38],
Oooo… that’s lovely!! :) I like that! I think the pudgy muppets are getting antsy! I’m considering it. :)
Lib the wife and I are the same way unless I’m getting the money for free I’m not buying. The mortgage is our only debt with an interest number associated with it. Otherwise it is save and delay. Though we have a boatload of airline miles we need to use.
for christ sake the only thing holding my truck together are dirt and hope.
re “money for free.” just bought some tickets to Puerto Vallarta with my credit card miles.
If interest is less than 3%, it’s all good especially on a hard asset(property), otherwise borrowing is foolish. My mortgage is 2.5% I have the cash to pay it off but won’t, my debt services is tiny and I get a write off
We did the Southwest deal for my free cruise out of New Orleans over Thanksgiving. I had to buy the points for one ticket, but they were 40% off. Ended up costing us $250 for 3 tickets to New Orleans over Thanksgiving. Not a bad deal at all.
not bad at all next year is my moms 60th and the kids will be nearly four so it is time to trade in all those miles. Hardest part has not been traveling as much for work so I have not been able to trade in miles for gifts for my wife and they have had to come out of pocket.
In fact, including exercise, recent years, after wearing 10 kg weight vest iron ore, which later became an excuse for his refusal to eat. Shin Kong Hospital pediatrician Jing-Sheng Lee pointed t25 out that obese children because t25 workout of excessive intake of calories, but do not let the children eat t25 workout too much and affect important nutritional snacks substance intake. shaunt t25 jumping exercises to do road between hop on one foot. jump up, “iron is important for growth and develop
Lib, go back to a 30 year loan. Why would you take a 15 year loan under the current conditions. 30 year is the smart move. What are you going to write off if your properties are payed for. You will have to buy another property.
Michael [47];
Why would you pay a dollar to save a quarter? No loan == no payments.
Exactly.
You are missing the point. Why would you not take out 30 year low interest loan? Esp to buy an income property. You get to keep your money and invest it long term. You get to use the banks money to generate profit. This is why I can’t believe people have not taken advantage of the low rates. Pure stupidity. They just don’t know how to make money. Fast eddie with all his complaining, could have bought in 2011 and sold last year for a profit. Instead he focuses on the overpriced houses and not the one’s involved in actual sales.
Anon E. Moose says:
July 30, 2014 at 12:33 pm
Michael [47];
Why would you pay a dollar to save a quarter? No loan == no payments.
@BarackObama:
“The states that have increased their minimum wage this year have seen higher job growth than the states that didn’t.” —President Obama
Michael [50];
You are missing the point. Why would you not take out 30 year low interest loan?
Becuase the price (rate) on a 15 year loan is less, that’s why.
Esp to buy an income property. You get to keep your money and invest it long term. You get to use the banks money to generate profit. This is why I can’t believe people have not taken advantage of the low rates. Pure stupidity. They just don’t know how to make money.
Having a paid-off income property IS a long-term investment. The only way to get there is to actualy pay the thing off. “Using the bank’s money” has a price tag attached to it.
I took advantage of low rates: I locked in 30 yr at 3-3/8%. I still want it paid off before I die.
Fast eddie with all his complaining, could have bought in 2011 and sold last year for a profit. Instead he focuses on the overpriced houses and not the one’s involved in actual sales.
Well, I don’t know about Fast Eddie’s motives for income property, but I do know you are wrong about buying in 2011 and selling now for a profit. I bought in summer 2012, an identical model house on less land around the corner from me is languishing at 10% more than what I paid. After 5% agent’s commission, and seller’s transfer taxes, I conclude this means that if I sold today I might break even, certainly not turn a profit.
@BarackObama:
“Baa Baa” —President Obama
Correlation does not mean causation.
anon (the good one) says:
July 30, 2014 at 12:49 pm
@BarackObama:
“The states that have increased their minimum wage this year have seen higher job growth than the states that didn’t.” —President Obama
Don’t use the agent if you want to profit. I was just trying to make a point. I don’t endorse flipping houses. It’s a long term investment vehicle.
“Fast eddie with all his complaining, could have bought in 2011 and sold last year for a profit. Instead he focuses on the overpriced houses and not the one’s involved in actual sales.
Well, I don’t know about Fast Eddie’s motives for income property, but I do know you are wrong about buying in 2011 and selling now for a profit. I bought in summer 2012, an identical model house on less land around the corner from me is languishing at 10% more than what I paid. After 5% agent’s commission, and seller’s transfer taxes, I conclude this means that if I sold today I might break even, certainly not turn a profit”
At 3.3%, you can’t find investments that will give you a better return than 3.3% in 30 years?
56- This is the point you guys are missing. If someone wants to give you a low interest 30 year loan, you take it, and you never ever pay it off early.
Passion Fruit,
What interest rate did you get on your latest 30 and how large is your loan? I’ve got 2.75% on a true no-cost loan which was essentially sold to Chase (which is convenient). Loan is down to 350K. The reason I ask is because I’m not sure you understand the negative effect of compounding over a 30-year time period. Give me your details and I’ll provide an example.
First of all, you didn’t get a 3.3% rate without paying at least 3/4 of a point and even then, you would have had to time the mortgage lock pretty well. Now that we got that lie out of the way, it’s pretty easy to find investments that SHOULD perform better than 3.3%. Until they don’t. I need not risk my home to juice my returns. I’m doing just fine with much less risk.
Keep borrowing from your home to invest in penny stocks and you will end up in a refrigerator box.
anon (the good one) says:
July 30, 2014 at 11:18 am
@AP: BREAKING: Palestinian official: 15 dead, more than 150 wounded in strike on busy Gaza market.
=====================
Consider the media obsession with the body count. According to a daily tally in the New York Times as of July 27 the war in Gaza had claimed 1,023 Palestinian lives as against 46 Israelis. How does the Times keep such an accurate count of Palestinian deaths? A footnote discloses “Palestinian death tallies are provided by the Palestinian Health Ministry and the United Nations Office for the Coordination of Humanitarian Affairs.”
OK. So who runs the Palestinian Health Ministry in Gaza? Hamas does.
========================
Global View
Palestine Makes You Dumb
To argue the Palestinian side, in the Gaza war, is to make the case for barbarism.
By Bret Stephens
Of all the inane things that have been said about the war between Israel and Hamas, surely one dishonorable mention belongs to comments made over the weekend by Benjamin J. Rhodes, deputy national security adviser for strategic communications.
Interviewed by CNN’s Candy Crowley, Mr. Rhodes offered the now-standard administration line that Israel has a right to defend itself but needs to do more to avoid civilian casualties. Ms. Crowley interjected that, according to Israeli Prime Minister Benjamin Netanyahu, the Jewish state was already doing everything it could to avoid such casualties.
“I think you can always do more,” Mr. Rhodes replied. “The U.S. military does that in Afghanistan.”
How inapt is this comparison? The list of Afghan civilians accidentally killed by U.S. or NATO strikes is not short. Little of the fighting in Afghanistan took place in the dense urban environments that make the current warfare in Gaza so difficult. The last time the U.S. fought a Gaza-style battle—in Fallujah in 2004—some 800 civilians perished and at least 9,000 homes were destroyed. This is not an indictment of U.S. conduct in Fallujah but an acknowledgment of the grim reality of city combat.
Oh, and by the way, American towns and cities were not being rocketed from above or tunneled under from below as the Fallujah campaign was under way.
Maybe Mr. Rhodes knows all this and was merely caught out mouthing the sorts of platitudes that are considered diplomatically de rigueur when it comes to the Palestinians. Or maybe he was just another victim of what I call the Palestine Effect: The abrupt and often total collapse of logical reasoning, skeptical intelligence and ordinary moral judgment whenever the subject of Palestinian suffering arises.
Consider the media obsession with the body count. According to a daily tally in the New York Times as of July 27 the war in Gaza had claimed 1,023 Palestinian lives as against 46 Israelis. How does the Times keep such an accurate count of Palestinian deaths? A footnote discloses “Palestinian death tallies are provided by the Palestinian Health Ministry and the United Nations Office for the Coordination of Humanitarian Affairs.”
OK. So who runs the Palestinian Health Ministry in Gaza? Hamas does. As for the U.N., it gets its data mainly from two Palestinian agitprop NGOs, one of which, the Palestinian Center for Human Rights, offers the remarkably precise statistic that, as of July 27, exactly 82% of deaths in Gaza have been civilians. Curiously, during the 2008-09 Gaza war, the center also reported an 82% civilian casualty rate.
When minutely exact statistics are provided in chaotic circumstances, it suggests the statistics are garbage. When a news organization relies—without clarification—on data provided by a bureaucratic organ of a terrorist organization, there’s something wrong there, too.
But let’s assume for argument’s sake that the numbers are accurate. Does this mean the Palestinians are the chief victims, and Israelis the main victimizers, in the conflict? By this dull logic we might want to rethink the moral equities of World War II, in which over one million German civilians perished at Allied hands compared with just 67,000 British and 12,000 American civilians.
The real utility of the body count is that it offers reporters and commentators who cite it the chance to ascribe implicit blame to Israel while evading questions about ultimate responsibility for the killing. Questions such as: Why is Hamas hiding rockets in U.N.-run schools, as acknowledged by the U.N. itself? What does it mean that Hamas has turned Gaza’s central hospital into “a de facto headquarters,” as reported by the Washington Post? And why does Hamas keep rejecting, or violating, cease-fires agreed to by Israel?
A reasonable person might conclude from this that Hamas, which started the war, wants it to continue, and that it relies on Israel’s moral scruples not to destroy civilian sites that it cynically uses for military purposes. But then there is the Palestine Effect. By this reasoning, Hamas only initiated the fighting because Israel refused to countenance the creation of a Palestinian coalition that included Hamas, and because Israel further objected to helping pay the salaries of Hamas’s civil servants in Gaza.
Let’s get this one straight. Israel is culpable because (a) it won’t accept a Palestinian government that includes a terrorist organization sworn to the Jewish state’s destruction; (b) it won’t help that organization out of its financial jam; and (c) it won’t ease a quasi-blockade—jointly imposed with Egypt—on a territory whose central economic activity appears to be building rocket factories and pouring imported concrete into terrorist tunnels.
This is either bald moral idiocy or thinly veiled bigotry. It mistakes effect for cause, treats self-respect as arrogance and self-defense as aggression, and makes demands of the Jewish state that would be dismissed out of hand anywhere else. To argue the Palestinian side, in this war, is to make the case for barbarism. It is to erase, in the name of humanitarianism, the moral distinctions from which the concept of humanity arises.
Typically, the Obama administration is hedging its bets. The Palestine Effect claims another victim.
My cousin who is 14 months out of undergrad with a liberal arts degree just passed CFA Level II…..as soon as he gets his 7, he should be listed as an author on published research……
What is it?
#54 Toxic Crayons says:
July 30, 2014 at 1:10 pm
Correlation does not mean causation.
Michael,
Fast eddie with all his complaining, could have bought in 2011 and sold last year for a profit.
Really? I suppose you knew who was going to win the world series for the last 10 years as well. And why would I buy a house just to turn around and sell it? What if I bought in 2006 and had to sell in 2011? Hindsight is wonderful, isn’t it?
That’s way too wordy.
Hamas can stop the incursion any time they want. They choose not to. Gaza has a representative government, just like ours. You voted for them, now reap what you sowed. If it’s shrapnel for breakfast? So be it. Vote for the non-terrorist next time when you get out of the hospital.
stu:
yahoo kicked back this e-mail address…
stujunkymail@yahoo.com
stu: this part
OK. So who runs the Palestinian Health Ministry in Gaza? Hamas does. As for the U.N., it gets its data mainly from two Palestinian agitprop NGOs, one of which, the Palestinian Center for Human Rights, offers the remarkably precise statistic that, as of July 27, exactly 82% of deaths in Gaza have been civilians. Curiously, during the 2008-09 Gaza war, the center also reported an 82% civilian casualty rate.
When minutely exact statistics are provided in chaotic circumstances, it suggests the statistics are garbage. When a news organization relies—without clarification—on data provided by a bureaucratic organ of a terrorist organization, there’s something wrong there, too.
Use stu_junkymail@yahoo.com
Forgot to underscore the importance of the underscore.
Let’s get this one straight. Israel is culpable because (a) it won’t accept a Palestinian government that includes a terrorist organization sworn to the Jewish state’s destruction; (b) it won’t help that organization out of its financial jam; and (c) it won’t ease a quasi-blockade—jointly imposed with Egypt—on a territory whose central economic activity appears to be building rocket factories and pouring imported concrete into terrorist tunnels.
This is either bald moral idiocy or thinly veiled bigotry. It mistakes effect for cause, treats self-respect as arrogance and self-defense as aggression, and makes demands of the Jewish state that would be dismissed out of hand anywhere else. To argue the Palestinian side, in this war, is to make the case for barbarism. It is to erase, in the name of humanitarianism, the moral distinctions from which the concept of humanity arises.
It doesn’t matter much to me. I have NO sympathy for the Palestinian plight. As I have no sympathy for Bebo and his ilk.
Following anon’s logic is the mental equivalent of nails on a chalkboard.
Lib [59];
I locked in June 2012 when the rate dropped from 3-3/4% to 3-5/8%. After I locked, but before the closing, rates dropped again. Prevailing rate at the time of my closing was 3-1/2%. With my lock still in effect, they wouldn’t float the rate down to market, but they did offer me a 1/4% discount for 0.5 points. I calculated my break-even at 25 months on the basis of interest paid/balance reduction, or 36 months on a simple monthly payment cash flow basis. I plan on staying more than 3 years, so I paid the half point.
[54] toxic
You are wasting your time. anon believes that post hoc ergo propter hoc is a legitimate and unassailable view provided it supports his argument.
Arguing with his kind is like arguing with 4 year olds. I’d say 5 year olds but my 5YO now seems to embrace sequential and causation concepts better than anon.
Honestly, I don’t know why he persists. He is like the Bill Carrey version of Diogenes, forever shining his lamp in search of a stupid man. He should stick to echo chambers where his kind congregates like DailyKos or presstv.com (I found that one yesterday and its a hoot!)
Negative effects of compounding? You lost me here.
I’m figuring based on compounding, that it’s much better to borrow at a low interest rate, than it is to pay cash, and take that cash and let it compound in the market for 30 years. That 4% you are paying is more than made up from the income that property generates. I don’t see why I would want to pay cash right now, unless I’m already too heavily invested in the stock market, and looking for some diversity for my cash investments.
Maybe I’m totally wrong, but please explain.
Libturd in the City says:
July 30, 2014 at 1:16 pm
Passion Fruit,
What interest rate did you get on your latest 30 and how large is your loan? I’ve got 2.75% on a true no-cost loan which was essentially sold to Chase (which is convenient). Loan is down to 350K. The reason I ask is because I’m not sure you understand the negative effect of compounding over a 30-year time period. Give me your details and I’ll provide an example.
73- and I forgot tax write offs. That 4% is nothing when you are collecting rent and writing off interest on your taxes.
This just in. We’ve discovered anon’s true identity
http://waysandmeans.house.gov/uploadedfiles/lerner_email_a.pdf
Agree, well said.
Libturd in the City says:
July 30, 2014 at 1:52 pm
That’s way too wordy.
Hamas can stop the incursion any time they want. They choose not to. Gaza has a representative government, just like ours. You voted for them, now reap what you sowed. If it’s shrapnel for breakfast? So be it. Vote for the non-terrorist next time when you get out of the hospital.
Unfcuking believable. This guy is touting foreign direct investment at the same time he is bashing corporate inversions. It’s beyond comical.
http://www.cnbc.com/id/101879369
If he really likes FDI, wait until corporate inversion legislation gets passed. Then he will really have something to gloat about.
Ok, I was trying to make a point. I never ever would endorse flipping on a primary residence.
You are sitting here stating that houses are overpriced. The ones that sold in 2011, now cost more money. The same old crappy houses you were looking at in 2011 are still there. I would concentrate on real listings that are priced to sell, not the bs you look at.
Fast Eddie says:
July 30, 2014 at 1:52 pm
Michael,
Fast eddie with all his complaining, could have bought in 2011 and sold last year for a profit.
Really? I suppose you knew who was going to win the world series for the last 10 years as well. And why would I buy a house just to turn around and sell it? What if I bought in 2006 and had to sell in 2011? Hindsight is wonderful, isn’t it?
This is one reason I avoid the Turnpike as much as I can.
http://www.cnbc.com/id/101875063
I recall one day on the turnpike when I was southbound in the truck lanes and one semi was bombing like JJ in a Beemer. Then, in my rearview, I saw it, at full highway speed, cross the median through one of the breaks for “authorized vehicles” and into the car lanes where it just continued to fly. Talk about drive it like you stole it.
Being a former commercial driver, I know the ilk and how well equipment is maintained (or not). My regular routes are expressly designed to have a higher ratio of cars to trucks. When I drive to Mass., I don’t use the Turnpike at all even though it is much more direct. And in Conn., I use the Merritt/W. Cross instead of 95. Going south to DC, I often use the Harbor tunnel and the BW parkway.
Stay safe out there.
Gator,
You were talking about property taxes and assessments the other day. My main concern with this house I was considering making a bid on was that it was going to alter my taxes drastically since the place needed a complete overhaul. I know it may be more coincidental but an agent told me that she sold a house in the same area in 2011 with 14K taxes. The owners re-did the place and their taxes are now 17K plus. That’s over a 3K jump in 3 years. That’s a 22% jump. This is my concern; not knowing what a gut job and replace is going to do to the tax price when permits are pulled and approved.
I would concentrate on real listings that are priced to sell, not the bs you look at.
Michael, read that statement over a few times and tell me what’s wrong with it.
My taxes didn’t go up post renovation, if they did it wasn’t more than a few hundred dollars.
We did significant work, all with permits. Nearly 50% of the interior was gutted, walls moved, removed, windows moved and replaced, two complete gut bathrooms, complete gut kitchen, relocated laundry, significant electrical work, 200amp service upgrade, nearly 100 new electrical devices (lights, outlets, switches), almost a complete rewire of the house, new deck, new doors, hvac changes, radiant heat, complete new trim, paint, floors, etc.
We did not add any additional square footage, nor did we add any new bathrooms or bedrooms. This is likely the most important factor to consider here. For like for like renovation, you are not taxed based on the quality of the replacement fixtures.
Fast Eddie 80 – With a 14k tax bill, if you assumed that the town raised taxes each year at the 2.5% max of Fat Man’s cap, that alone would account for $1,000 of the increased taxes.
The assessor should be able to tell you how much the assessment would increase for renovated kitchens, bathrooms, extensions, etc.
Also, do you know the address of the house your realtor spoke of? If you do, why don’t you look up the change in assessment in the tax database?
NJGator,
I do know the address and will look it up.
Grim,
With my luck, I would do a bathroom and kitchen and get hit with the increase.
And I would recommend that you do the same. Meaning, you are concentrating on the bs listings. Get a good agent so that you are first in line when he/she gets a new listing. It’s really the only way a person with your personality will find a home. God bless that agent, god knows what kind of hell you will put them through. If they were smart, they would stay far away from your type. Your type? Yes, meaning you want top dollar when you sell your home, but want the deal of the century when you are buying. Lol you know that unrealistic seller you talk about, look in the mirror. You are an unrealistic buyer/seller.
Fast Eddie says:
July 30, 2014 at 3:06 pm
I would concentrate on real listings that are priced to sell, not the bs you look at.
Michael, read that statement over a few times and tell me what’s wrong with it.
The big property tax increases come from the addition of usable square footage. Additional fixtures add a very negligible amount to your taxes. Grim is correct. Your tax does not change based on the quality of renovations. Of course, when you sell your place with much higher quality fixtures, new oak trim and other aesthetic upgrades, the higher sale price of the house becomes the new baseline to base your property assessment on. This is why buying a fixer upper is the way to go as opposed to overspending on the seller’s improvements.
87 – As I understand it, a property can not be a comparable for itself for tax assessment purposes. For example, you can’t buy a lowball and use your own sale to reduce your tax assessment.
unmod
Grim 88 – He is thinking eventually when the town does a townwide reval/reassessment.
Luckily we bought our home close enough to the reval to make sure our sale price and water issues got factored in (even though we are not in a high risk flood zone according to FEMA). Next door neighbor was able to use our sale to argue his assessment down 100k informally before the new values were certified to the county.
The surly, grumpy, antisocial man next door to him has the same water issues as us, but doesn’t have a clue. He’s assessed for 130k more than the rest of us. That’s an additional $4200/year in taxes.
Back from Disney. I need a blog called folks of Disney, fat folks in wheelchairs, tats all over. Asians with big cameras you name it.
BTW lots of folks paying cash have stocks and bonds in a point in a cycle where they are overvalued and want to sell some to diversify into real estate. To do that cash may make sense even more if you can get a discount for cash.
Buying Cash made a lot less sense in 2009-2012 as you were selling bonds and stocks low. And missing out on a lot of potential gains.
BTW I paid cash for my condo and rent it, the depreciation, maint, taxes, insurance guarantee I dont pay taxes. I needed to put 40% down on the investment property to get a good rate and pay 10K in closing. The interest write off would only be 5K a year and in 40% tax bracket a savings of 2k a year. It would take me five years just to make back closing costs in tax savings.
Downside is I could have bought several investment properties if I did not pay cash. Instead I only have one. And not even a real investment property as I skip renting it all the time in the summer unless I find someone good as I dont want to deal with headaches.
How much taxes do you pay? I got helped a lot in my assessment as my split the main level had water everywhere, including the two extensions and attached garage plus the lower level. Meaning almost 70% of square footage got water. I am assessed at my land value plus around 30% of my home value.
Supposedly when I file permits to repair, sell house or do improvements or expand house they will be able to reassess. None are happening any time in the near future. If I move I might rent it our as the cash flow from a mortgage free home with 2k annual taxes are damm good. And the next buyer can get reassessed so he will only get the tax break for maybe 1-3 years so he wont pay me much of a prem. But to me the tax break is priceless. Also means I could make it a snow bird house if I wanted as carrying costs are a joke.
90.NJGator says:
July 30, 2014 at 4:20 pm
Grim 88 – He is thinking eventually when the town does a townwide reval/reassessment.
Luckily we bought our home close enough to the reval to make sure our sale price and water issues got factored in (even though we are not in a high risk flood zone according to FEMA). Next door neighbor was able to use our sale to argue his assessment down 100k informally before the new values were certified to the county.
The surly, grumpy, antisocial man next door to him has the same water issues as us, but doesn’t have a clue. He’s assessed for 130k more than the rest of us. That’s an additional $4200/year in taxes.
Not a deciding factor but can be considered. Older homes with no comps that you buy as a fixer upper cheaper and can repair with no permits usually are great buys tax wise.
88.grim says:
July 30, 2014 at 4:08 pm
87 – As I understand it, a property can not be a comparable for itself for tax assessment purposes. For example, you can’t buy a lowball and use your own sale to reduce your tax assessment.
JJ 92 – When you open permits in NJ, they don’t do a complete reassessment of the house, they only do added assessments for the improvements. You can appeal the amount of additional assessment.
Hipster food in Brooklyn.
http://observer.com/2014/07/montanas-trail-house-brings-morally-hazardous-appalachian-cuisine-to-brooklyn/#ixzz38tUfBnGK
JJ,
July is a terrible time to visit Disney World. Hot and crowded. Late November to December is the right time, because it’s cooler and that’s when kids are in school. Which is why that’s the right time for them to all “get a flu” for a week at that time of year, if they can bear the academic setback.
I lived in central FL back in the 80s and 90s. My wife and I even had an annual pass one year before moving to NJ. I would have given you some tips if I’d known you were going. We have visited a couple times over the past ten years.
In NY no one gets a permit unless it is an improvement. Stuff like electric boxes, kitchen remodels, bathroom remodels no one gets a permit.
Stuff like an extension to house or adding square footage people do it. No need to get folks in your house.
Also oddly folks have a million questions when you sell with permits, who did you hire etc. But a room looks good no one asks. Even better contractors even licensed ones give two quotes or sometimes three quotes, a quote with no permits, quote with permits and a quote for cash. Folks usually take the cash no permits price. They really tack on a lot of charges for time wasted with inspectors and fees. And homeowners pays it all. This happens everywhere.
I already have three grievances in play on the condo I bought last June. First I grieved in names of prior owners prior to purchase and signed that grievance over to me. I got a grievance from this year and I also filed a NYS Sandy Damage grievance. All three pending. Condo assessed at 35K less than I paid. I am using the old Billy Joel Defense claiming I overpaid and my purchase price has no bearing on assessment.
94.NJGator says:
July 30, 2014 at 4:53 pm
JJ 92 – When you open permits in NJ, they don’t do a complete reassessment of the house, they only do added assessments for the improvements. You can appeal the amount of additional assessment.
When I self signed the permits, I think I estimated the value of the construction renovations at $500, they pushed back on the electrical, and told me it wasn’t possible for me to do the work for less than $5000, so I wrote in $2000.
My electrical work I did some myself and some illegals did some too. It is fair to say it added no value
grim says:
July 30, 2014 at 5:09 pm
When I self signed the permits, I think I estimated the value of the construction renovations at $500, they pushed back on the electrical, and told me it wasn’t possible for me to do the work for less than $5000, so I wrote in $2000.
[95] gator,
All the more reason to go.
I took out a jumbo loan, so I wasn’t able to get 3.1%. So I had to pay more and get the 4.1% loan. I have no complaints, since they are loaning me a lot of money for 30 years with a very low interest rate compared to long term avg rates. My income property is in the clear. I took a 15 year loan on the income property since it was a 7.5% rate. I actually payed more in the beginning due to the rate. Higher interest loans I try to pay as fast as possible. 4% loan I refuse to pay anymore than I have to. No reason to rush to pay that, esp when rates are going to start rising.
Libturd in the City says:
July 30, 2014 at 1:16 pm
Passion Fruit,
What interest rate did you get on your latest 30 and how large is your loan? I’ve got 2.75% on a true no-cost loan which was essentially sold to Chase (which is convenient). Loan is down to 350K. The reason I ask is because I’m not sure you understand the negative effect of compounding over a 30-year time period. Give me your details and I’ll provide an example.
101- I think I have 495,000 left on the mortgage. I have to double check.
Barring an unforeseen, exogenous event, this is how the bull market will end: The Federal Reserve will push interest rates higher until the economy slows and corporate earnings tumble.
That day is a ways off yet.
Wednesday, the Fed signaled that it is reducing its market-friendly bond-buying program by $10 billion a month, and that it would keep short-term interest rates at extraordinarily low levels. Here’s the key wording: “Even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run. ”
FED: Cites better economy as it cuts bond buys again
ECONOMY: Economy heats up in Q2 after harsh winter
Low interest rates are meant to stimulate the economy by making it easier for businesses and individuals to borrow and invest. Naturally, there are other consequences. For investors, the primary consequence is that other investments, such as bank CDs and money market funds, look terribly unappealing. The average money fund yields 0.01%, according to iMoneyNet — literally less than nothing, after inflation.
Longer-term bonds are similarly unappealing. The 10-year Treasury note yields 2.55%. At that rate, you’ll double your money in a bit more than 28 years.
The Fed did have encouraging words for the economy, saying that the jobs market is improving. Corporate profits are strong: Standard and Poor’s is looking for a year-over-year increase of more than 8% in corporate earnings, and Thomson Reuters is looking for a bit more than 6% — both decent showings.
Federal Reserve Chair Janet Yellen gathers her papers at the conclusion of a news conference at the Federal Reserve in Washington, Wednesday, June 18, 2014.(Photo: Susan Walsh, AP)
In many ways, the current market is looking like a normal middle-aged bull market. Typically, small- and midsize company stocks rise at the beginning of a bull market, because they’re more nimble and more sensitive to short-term interest rates. And the past five years, both small and midcap stocks have beaten the large-cap Standard and Poor’s 500-stock index.
As the bull market gets older, large companies pull ahead — in part because investors feel safer with them, and in part because they take longer to recover from a recession. Big banks typically lag, because it takes them longer to work off bad loans in the recession. That’s exactly what’s happening now.
Just before the stock market peaked in 2000, the Fed had hiked the fed funds rate to 6.5% from a low of 3% in 1992. The Fed pushed up short-term rates to 5.25% before the market peak in 2006 from a low of 1% in 2003. Barring unforeseen events — and there are plenty of good candidates — it will take considerable pushing from the Fed to kill this bull market.
http://www.usatoday.com/story/money/2014/07/30/first-take-federal-reserve-minutes/13367127/
Lib and moose, nothing for nothing, this is exactly what I meant by taking the banks money at very low costs and investing it. Paying in cash with low rates available doesn’t really make much sense if you are trying to make money and get ahead. It’s much smarter to grab as much money as the bank will qualify you for and put it to work. That’s why they lower the rates, to spur investment.
“Low interest rates are meant to stimulate the economy by making it easier for businesses and individuals to borrow and invest. Naturally, there are other consequences. For investors, the primary consequence is that other investments, such as bank CDs and money market funds, look terribly unappealing. The average money fund yields 0.01%, according to iMoneyNet — literally less than nothing, after inflation”
Good to have you back. Was wondering where you have been. Been killing it in the market while you have been gone.
JJ says:
July 30, 2014 at 4:39 pm
Back from Disney. I need a blog called folks of Disney, fat folks in wheelchairs, tats all over. Asians with big cameras you name it.
BTW lots of folks paying cash have stocks and bonds in a point in a cycle where they are overvalued and want to sell some to diversify into real estate. To do that cash may make sense even more if you can get a discount for cash.
Buying Cash made a lot less sense in 2009-2012 as you were selling bonds and stocks low. And missing out on a lot of potential gains.
BTW I paid cash for my condo and rent it, the depreciation, maint, taxes, insurance guarantee I dont pay taxes. I needed to put 40% down on the investment property to get a good rate and pay 10K in closing. The interest write off would only be 5K a year and in 40% tax bracket a savings of 2k a year. It would take me five years just to make back closing costs in tax savings.
Downside is I could have bought several investment properties if I did not pay cash. Instead I only have one. And not even a real investment property as I skip renting it all the time in the summer unless I find someone good as I dont want to deal with headaches.
For the realtors among us here….Friends are trying to buy a house where the owner is in Chapter 7 bankruptcy. What extra special torture can they expect to endure during this process if they decides to pursue it?
26. i’d still pay good money to not be you.
it’s a town for losers, i’m pullin outta here to wiiiiiin.
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May home price gains continue to show signs of slowing | New Jersey Real Estate Report
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