From Inman News:
Lean times for mortgage lenders foreseen in 2007
Private-label, subprime mortgage originators will have a more difficult time selling Wall Street investors risky loans in 2007, experts say, even as they face tougher underwriting and disclosure standards from regulators.
But don’t expect “exotic” loans to become extinct as the mortgage lending industry copes with slackening demand for all types of loans through layoffs, consolidation and modernization.
The Mortgage Bankers Association projects home loan originations will fall 11 percent this year, to $2.21 trillion, followed by an additional 7.4 percent decline to $2.05 trillion in 2008. By comparison, lenders funded $3.03 trillion in mortgage loans in 2005, the second-highest year on record, and an estimated $2.48 trillion in 2006.
…
MBA economists expect purchase originations — which reached a record high of $1.51 trillion in 2005 — to total $1.29 trillion in 2007, down 6.7 percent from last year. Refinance originations are projected to drop even more sharply, to $918 billion, a 16 percent decline from 2006.By 2008, the MBA projects refinance loans will constitute just 37 percent of the mortgage origination market, compared to 50 percent in 2005 and 44 percent in 2006. Refi’s will make up 42 percent of loan originations this year, the MBA forecasts.
“After every good party there’s a hangover,” said Amy Crews Cutts, deputy chief economist at government-sponsored mortgage repurchaser Freddie Mac. “We’ve seen a huge boom in mortgage-related employment, including Realtors.”
Now, Crews Cutts expects to see consolidation as lenders cut capacity.
…
In the last weeks of 2006 — as several subprime lenders were closing their doors because of financial difficulties — the Center for Responsible Lending issued a report predicting that one in five subprime loans originated in the last two years will wind up in foreclosure.
…
The Mortgage Bankers Association criticized the study as alarmist, and argued against tighter restrictions on lenders. One reason for the recent up tick in delinquencies and foreclosures is that more people took out loans during the housing boom, the MBA said.But Kenneth Rosen, of the University of California, Berkeley’s Fisher Center for Real Estate and Urban Economics, said the problem is real, and subprime loan originators and the investors who financed them are to blame.
“Subprime loans, for the last and early part of this decade, were 2 percent of the market,” he said. “Then all of a sudden it became 15 percent of the market because you could securitize them through Wall Street. People who normally wouldn’t meet the criteria were approved for loans. It was a sure thing there would be substantial delinquencies and foreclosures.”
Rosen expects delinquencies and foreclosures to continue to rise, because “as housing prices decline, people are less inclined to make payments.”
From MarketWatch:
Mortgage applications surge 16.6%
The volume of mortgage applications filed with major U.S. banks rose 16.6% on a seasonally adjusted basis last week compared to the week before, the Mortgage Bankers Association reported Wednesday.
The number of applications — including both purchase loans and refinance loans — also increased compared with the same week a year ago, up 12%.
Application volumes, on a seasonally adjusted basis, had plunged about 14% just before the holidays.
“Applications for mortgage products are a good indicator of housing-market activity,” said Robert Brusca, chief economist for FAO Economics, in a note to clients ahead of the MBA’s report.
After taking into account all of “the usual flutter of volatility and weakness” at the end of the year, “in all likelihood the progress in housing has continued,” he said.
Applications for loans to purchase homes rose 16.2% compared with the previous week. Purchase-application volumes thus stood at the highest level in nearly a year, and were up about 3% compared with the same week a year ago.
By contrast, home sales have fallen about 11% on a year-over-year basis through November.
Last week’s applications to refinance an existing mortgage increased 17.3% compared with the previous week. Refinancing applications are up about 28% compared with a year ago.
Refinancings accounted for 48.4% of all loan applications filed last week as tracked by the MBA, nosing up from 48.1% in the previous week.
Adjustable-rate mortgages accounted for 20.1% of applications, off from the prior week’s 20.4% and the smallest share since July 2003.
Interesting stuff. Look for more sinking mortgage ships and major banks reorging mortgage departments.
BTW, I’m assuming Amy Crews Cutts at Freddie Mac is an intelligent individual. However, why would you use your maiden name (I’m assuming) if the combination with your married name means a bad haircut? I think it’s kind of neat to use both sometimes, but that’s one I would reconsider.
JM
“Private-label, subprime mortgage originators will have a more difficult time selling Wall Street investors risky loans in 2007,”
At current spreads, like selling ice to eskimos. Wall Street can sell basically anything to yield hungry investors. When the street sends these back to the originators the outcome is not a pretty pic, which is what we are witnessing now.
http://www.latimes.com/business/la-fi-horton10jan10,1,7202035.story?coll=la-headlines-business
D.R. Horton Inc., one of the nation’s largest home builders, said Tuesday that its late-2006 sales orders fell 28%, dampening sentiment that the housing sector may be recovering from a slump.
The news was even worse from another builder, Meritage Homes Corp., which said net sales orders fell 42% and cancellations hit a record 48% in the fourth quarter.
I know my parents just refinanced for a lower rate. Also, I’m not surprised to see an uptick with sellers finally capitulating a bit and rates still low. I know people who have just bought – both under asking. They also both happen to be sellers – one sold a one bedroom suburban co-op for a little under asking and the other is about to put his place on the market, also a suburban co-op (but smart seller this one – bought in 2001, crazy saver and doesn’t need the $ from the co-op for the house, and has stated that they will undercut other sellers if they have to cause they will still make a profit).
Great piece over at Winter Watch:
http://wallstreetexaminer.com/blogs/winter/?p=287
jb
http://news.yahoo.com/s/nm/20070110/ts_nm/housing_affordability_dc
“U.S. home prices may have dipped over the past year, but many American workers would still struggle to afford a median-priced home in major cities, a new study said on Wednesday………”
Al Says:
January 10th, 2007 at 7:42 am
My conversation with realtor 2 days ago… Italic text are my thoughts:
Realtor: Hello I am calling to return you call from ##/##/07… (formal greetings and introductions.)
I understand you are looking fora house in ####$##$ area??
Yes?? (why else whould I call you??)
realtor: Are you pre-approved and what are your limits??
(Hey w.t.f. first question of conversation is this?? may be you’d like my bank accound statements as well??)
My answer:
Also I do not see the relevance of my pre-approval limits on current conversation, I am pre-approved well within limits of my price range – price range for starter homes.
realtor: “and what is your price range?”
Me: Clearly since price range of the starter homes varies significantly with area it is meaningless to put a fixed label on it. I am looking for starter homes in this neighbourhoods. Isn’t that enough information to start looking??
(I am not giving you a number. You must have switched to Realtors from a New Car Salesman. Why such an obsession with money in my pocket?? I do not like you already.)
Me: I would like to look at these three houses which are advertized by you, are they still available??
Realtor (seems like he is greatly turned off): Yes they are, How about I will email you some listing tomorrow and you email me back ??
Me: Sure. (how do this guy sell anything?? Here I am, telling him that I want to look at three of the homes he is representing, and he tell’s me I will email you back some listings???)
Goodbuy….
Now, with skills like this you will get fired at my work in about 2 weeks… When Client calls in is freaking sacred. granted our minimal sale of a product is in 10’s of millions so every one of the clients or even remotelly potential clients are very dear to us. But I do not see any money from one particular sale like reators do. Is their buisness is still very good so they do not need to sell anything? Am I suppose to call him and tell him – hey I am going to vbuy this home tomorrow, can we meet and sigh papers, and after that, the agency will get 18,000$????
Any comments:
Did I do something wrong??
Do you have to tell the realtor pre-approved amounts or amount of money you are ready to spend?
Why would I want to give up such an important piece of information, if there are future possible negotiations??
Remember I did tell him that I am pre-approved enough for homes in the area, and I told him that I am ready to look at 3 homes he represent, and he told me that those homes are still up for sale!!!
What is going on?? Customer Service?? (I am his customer, am I not??)
By the way it was full service full fee, one of the biggest real estate brokerage companies in Northeast.
P.S. it was 3 days now with no emails/contacts from the realtor.
I am tempted to drive to those homes and tell the owners my story – that I told the reator that I want to look at their house and he did nothing.
JB,
Excellent piece at Winter Watch.
NJSUX,
Thanks for the Reuters piece, interesting as well:
U.S. home prices unaffordable for many workers: study
The study found an annual income of nearly $85,000 was needed to afford the median-priced U.S. home.
In the New York metropolitan area, a $500,000 median-priced home required a $171,000 annual salary. The median-priced home in San Francisco, the most expensive U.S. market, was $759,000, requiring income of $260,000. In less-expensive Chicago, the median-priced home cost $254,000, requiring an $87,000 salary.
Of the people I know who purchased ~$500k homes in Northern NJ last year, none of them had an income remotely near $171,000.
jb
Al reg #8,
I have had almost identical conversation way too many times.
I avoid realtors at all costs. I go to open houses or look up listings on realtor.com. I have two agents sending me new house updates.
Once I like a house – after driving by, tax records, etc. I contact the sellers agent. I am upfront and tell them that I am interested ONLY in the listed house and none-other. Then tour the house.
There are very few houses which still interest me after this process.
Still looking..
(and i am not even talking about price here)
Interesting move by the Assembly…
Assembly OKs longer notice of impending layoffs
A bill that would give workers facing layoffs more time to find a new job is meeting opposition from the business community.
The Democratic-controlled Assembly on Monday endorsed the bill (A-1044) to add 30 days to the current federal requirement governing layoff notices.
…
The federal law, known as the WARN Act, requires employers to give 60 days’ warning if they terminate a certain number of employees, usually more than 100.
Under the proposed state law, companies are required to give 90 days’ notice. The measure applies to businesses that lay off 500 or more workers, or terminate 50 or more employees who together number more than a third of the workforce at that location.
A business that fails to comply with the law will have to pay workers a week of severance pay for each year they were employed at the company.
…
Jim Leonard, a lobbyist for the New Jersey State Chamber of Commerce, said that requiring a company to give a 90-day warning that it is in trouble complicates efforts to keep the business afloat, or close it in an orderly manner.
Suppliers, for instance, might require payment upfront, he said. And employees may start leaving, he added, noting that other states are staying with the 60-day federal requirement.
“It’s another example where New Jersey thinks it needs a standard that’s different from the rest of the world,” Leonard said.
NJ State WARN Notices can be found here:
http://www.state.nj.us/labor/warn/warnindex.html
jb
“Of the people I know who purchased ~$500k homes in Northern NJ last year, none of them had an income remotely near $171,000.”
Were they first time home buyers? I could understand if they traded up, but would be curious on how they pulled it off (e.g. large down payment, interest-only mortgage, inheritance, etc…)
Need some advice.
Looking at Scotch plains, Berkeley Heights, New Providence. Give me some feed good, bad etc on these towns. I have 3 kids under 8 and i really want a nice family town, with good schools. Which would you prefer and why. Thanks for any info, want to do the right thing, plan on buying in the infamous “spring 2007”
Thanks native jerseans
Jerseygirl
Also, I’m not surprised to see an uptick with sellers finally capitulating a bit and rates still low. I know people who have just bought – both under asking.
Good point.
Itulip.com describes a collapsing housing market as a series of “self-reinforcing deflationary waves” rather than a linear process.
The way housing busts happen is not exactly a mystery. They occur as a series of self-reinforcing deflationary waves. The process is non-linear. Inventories rise, then price pressures rise, then transaction volumes fall, then sales volumes rise again–although not to previous levels–as prices decline, then inventories rise again, price pressures increase further, and so on.
http://www.itulip.com/forums/showthread.php?t=547
Sorry my error, “give me some FEEDBACK good bad etc. on these towns.” having a rough morning!
Jerseygirl–I had a house in New Providence in the late 90’s. I would personally choose Berkeley Heights or New Providence over Scotch Plains any day. I have a severe aversion to getting on or crossing Rt 22. The school system in NP is excellent. What I don’t like about NP is too many houses are lacking charm (splits and bi’s), which is just a personal preference.
Rachel
“unaffordable housing is the major reason families lack health insurance..”
http://money.cnn.com/2007/01/10/real_estate/bc.housing.affordability.reut/index.htm?postversion=2007011010
That was the societal statement that got me. It’s one way we are all paying to bail out the stretched homeowners.
In the New York metropolitan area, a $500,000 median-priced home required a $171,000 annual salary.
In NJ, better makes sure make even more to pay hefty property taxes…LOL.
But we are close to NYC, and that solves every thing.
Great thread over at Broker Outpost..
http://forum.brokeroutpost.com/loans/forum/2/82609.htm
so, basically the ‘system’ is converting all homeowners (atleast the $500k bagholders with
(reposting.. post cut off)
so, basically the ‘system’ is converting all homeowners (atleast the $500k bagholders with
(reposting.. post cut off because i used the less than symbol)
so, basically the ‘system’ is converting all homeowners (atleast the $500k bagholders with less than 170K incomes) into gamblers. Gambling away their future incomes to a ponzi scheme created by the Govt.
very sad!
What is the end going to look like?!
JB or others,
I would like to compare last year’s MBA numbers without refinancing with this year’s to find the decline in numbers with respect to home sales. I feel MBA numbers without refinancing component may be a leading indicator of home sales. Over the past few days refinancing number is at the 50% level.
Am I missing something?
If not, do you know where i can get historical MBA numbers with refinancing percentage?
Calculated Risk tracks the MBA purchase index weekly, graphed with 4 and 12wk MA.
http://photos1.blogger.com/x/blogger/2825/754/1600/315969/MBA2010507.jpg
I don’t have a link to the underlying data. You might just want to email him, I’m sure he’ll email you the spreadsheet or a link.
jb
grim, been running silent for a while now. that brokerpost thread is unbelieveable. this must be the flipper nation saga for episode 4… the ‘LITE DOC’ easy mortgages if you can ‘prove employment.
nice.
anybody notice that Mills is getting ready
to file a BK. I called that one over a year
ago. Hats off to the Pols who selected
this vendor.
Good thing they got out. However, it remains
to be seen how the NJ taxpayer will take it
in the shorts on Xandau.
Watch,
Can someone please recommend a good real estate agent in Essex county?
Mills may be out, but there isn’t any way Barrack would have gone in if Colony stood to lose on the deal. He is no dummy either. I said it before, and I’ll say it again, the wildcard here is turning Xanadu into a gaming destination.
jb
FTB,
Email me.
jb
Check out this million dollar listing. Seriously, this country has gone crazy with RE.
http://newyork.craigslist.org/jsy/rfs/260449285.html
A little off topic, but for buying purposes – I know the standard is 2.5 times your gross income (3x if you are daring). What if you have a contractual, guaranteed year end bonus, like a certain % of your yearly salary? Does that count in the calculation or not? My gut says no because it’s not like you will have that money during the year, but I want to be sure.
A little pricey Zack, but I admit, I like the house. Great yard, love the updates and the Arts and Crafts look. Would I pay that? No. Could I see 750? Sure.
For those interested in taking a look at how inventory is shaping up in ’07.
GSMLS
Ber,Ess,Hud,Mor,Pas,Som,Sus,Uni,War Counties
Jan 2, 07 – 14,995
Jan 10, 07 – 15,366
Up ~2.6% year to date, up ~35% since this time last year.
(Jan 10, 06 – 11,330)
NJMLS
Ber,Ess,Hud,Pas Counties
Jan 2, 07 – 7,056
Jan 10, 07 – 7,295
Up 2.9% Year to date, up ~36% since this time last year.
(Jan 10, 06 – 5,370)
jb
I’m getting database errors on MLSGuide, but here is what I have.
Jan 2, 07 – 2,486
Jan 2, 06 – 1,725
Up ~44% since this time last year.
jb
From Marketwatch:
Fed’s Moskow: Recent inflation news ‘good’ but risks remain
Moskow: Economic growth will pick up
Moskow says inflation remains his ‘predominant concern’
Moskow: Key is whether easing inflation trend is sustained
Moskow sees risks inflation will not drop in timely fashion
Moskow: Low jobless rate near level that may spur inflation
Moskow: No evidence drop in home prices hurting spending
Moskow: Economy on ‘good footing’ outside of housing
JB, great thread over there:
———————————–
“Sweetie222” wrote:
We have a loan in with Indymac but they counteroffered an unacceptable scenario.
627 FICO
…
No Doc
———————————–
“sub prime guy” wrote:
Why can’t they go stated? Unemployed?
———————————–
“Sweetie222” wrote:
Correct. Wife stopped working about five months ago and husband was locked up for 18 months at Riker’s.
http://forum.brokeroutpost.com/loans/forum/2/82609.htm
———————————–
And these morons, if they actually manage to get a loan, will distort the “sales” data.
Conversely, they’ll affect the increasing foreclosure data as well…
un,
Did you see the Jersey loan scenario for the husband and wife doctors that make $30k a month but have credit scores in the low-500 range (missed mortgage payments)?
http://forum.brokeroutpost.com/loans/forum/2/84476.htm
jb
Can anyone tell me what MLS # 2310126 sold for? I got the number from GSMLS.COM. I just drove by and looks like they are moving.
#41 – I know someone like that – even more extreme case – makes about $1.5mil a year and had his cable shut off.
This stuff is made up. No way.
Well, maybe if they’re snorting the money, I guess. But the one guy is looking at a stmt so it’s proofed. I just can’t believe this.
JB, they’re right of the book “The Millionaire Next Door.”
Make $300K a year, spend $350K a year. Crazy.
Can anyone tell me what MLS # 2310126 sold for? I got the number from GSMLS.COM. I just drove by and looks like they are moving.
Still in attorney review, make a note and we’ll check back in a few weeks.
jb
JB,
Thanks!
If you haven’t voted for the NJ Real Estate Report as your favorite regional blog, please take the time to vote!
http://www.housingwire.com/2007-rebas/
We weren’t nominated, so you’ll need to write in your vote! It only takes a minute!
Appreciate your support.
jb
JB: I just voted. Thanks for all of your hard work. I will be starting the low ball process this Spring. All they can do is say no.
Can any one tell me about thse 2 njmls listings 2639773, and 2640251. Thanks in advance.
#51 –
I posted a response to you when you posted about this the other day. Either you didn’t see my post or ignored me. Either way, we looked at both of these houses… I can give you a quick summary if you want.
JB,
Have you considered making this blog into more than a RE blog?
Something like clarkhoward.com?
Re: the husband/wife doctor team making $30k a month and having no credit.
The average medical student graduates with $129k in debt these days. After you put in for your four years of residency at low wages (less than $50k), you can finally start to make some money but only if you go into certain practice types such as Cariology or Surgery (not so much the pediatricians, family practioners).
By the time you finally make decent buck, you still have hundreds of thousands of dollars in loans to pay back. If you are smart, you pay it off quickly (unless you are paying less than 4% interest). If you are not, you start investing in real estate in 2007.
Re: the husband/wife doctor team making $30k a month and having no credit.
The average medical student graduates with $129k in debt these days. After you put in for your four years of residency at low wages (less than $50k), you can finally start to make some money but only if you go into certain practice types such as Cardiology or Surgery (not so much the pediatricians, family practioners).
By the time you finally make decent buck, you still have hundreds of thousands of dollars in loans to pay back. If you are smart, you pay it off quickly (unless you are paying less than 4% interest). If you are not, you start investing in real estate in 2007.
BOOOOOOOOOOOOOYAAAAAAAAAAA
Bob
Jersey Girl, If I were you I would focus on B/Heights or N/Providence, great towns, great schools, what I like most about both towns, there are no bad areas, Good Luck with your search. Also J.B. you got my vote, thank you for all your hard work and information.
2007 SPRING HOUSING MASSACRE COMING TO A HOOD NEAR YOU.
NO SPRING MAGIC..SPRING MISERY!
hehehehhehehehe
Off topic but interesting (to the geeks anyway).
Anyone else notice the similarity between the new Apple iPhone and the old Newton?
http://www.blakespot.com/list/images/mp2100.jpg
http://www.sciam.com/media/externalnews/2007-01-09T215728Z_01_NOOTR_RTRIDSP_2_TECH-APPLE-MACWORLD-DC.jpg
jb
I believe voting closes at 10:00pm central tonite, so don’t wait too long to vote.
jb
You’ve got my vote! While I don’t post often, I have learned a lot from this site.
Thanks for all of your hard work.
This is the kind of thing (OK, there are lots of things, but this is one of them) that kills me:
http://www.realtor.org/rmodaily.nsf/pages/News2007011001?OpenDocument
Exotic Mortgages Could Be Big Election Issue
Fallout from the surge in subprime and exotic mortgages taken out during the housing boom could become a major issue in the 2008 national elections, political analyst Charlie Cook told REALTORS® at advocacy training sessions in Washington, D.C., this week.
As many as 10 million loans could go into default over the next 18 months as borrowers run into financial problems when the low-interest introductory period of their loan terms ends and they find they can no longer meet their repayment obligations, Cook told several hundred politically active REALTORS® on Jan. 9.
Now Charlie Cook is surely well informed regarding the goings on in Washington D.C., but I have never once heard him called on to make some kind of housing call.
If he is right and there are 10 million foreclosures coming in the next 18 months, and only half of them come in 07, this will be an unprecedentedly bad economic year.
That call is more than 3 times worse than the year we just had. That makes the recent call by the Center for Responsible Lending look incredibly hopeful. MBA economist Doug Duncan called it overly pessimistic.
I can’t believe Lereah didn’t bound from the audience where Cook said this and call it total crap. I’m very negative on the 07 outlook, and I don’t think there will be anything like 5M defaults.
#59..
the newton looks more macho ;-)
I’ll fix it.
jb
JB,
You got my vote too; keep up the good work.
I’ve put the change through several times already but it hasn’t taken. Sorry about that.
Thanks JB
lurkerA: I am sorry, I did not see your response the other day. I would love a quick summary ont hese 2 listings if you can.
I believe one of the listings, (the one now down to 479K) closed in late 05 at 500K.
Again I appreciate any information you have on these, and sorry I missed your prior response.
No worries, I just wasn’t sure if you were just ignoring me, since i usually never come out of lurking mode. Here’s some more than I had originally included.
So you probably already realize that these two houses are on the same street. Cute neighborhood, we love river edge (ended up buying somewhere else though).
So the colonial – the asking price was over $500k when we looked at it, I think. This was about 2 months ago, maybe a little less. Anyway, we went to it twice b/c the first time we were there it was at night. no garage, they converted it into a 4th bedroom and full bath, which was nicely done. the kitchen is new, but cheaply done and oddly laid out. the basement is “finished” but is a total dump. the bedrooms are all a little small, but tolerable. when we came back the second time, during the day, we noticed it had broken windows and it’s like they redid the siding at some point but didn’t finish b/c there’s an unfinished part in the back and it looked like there was some sort of crack in it (my husband noticed it, I didn’t, he mentioned it later so i can’t explain more – sorry!). also, there’s this weird deck on the side that doesn’t go anywhere (it’s just for a grill or a smoker, you can’t get to the ground from it). we learned a LOT seeing it during the day. no pride of ownership, at all. these people didnt care about their house at all, they’re definitely going to take a loss (obviously, if they bought it for $500k in 2005!).
the cape – so it’s your typical layout for a cape in this area – except it has a very cute entryway and a bonus room on the back, they’re using it as an office, but it’s nice – exposed brick, we really liked it. also has a nice porch. the kitchen needs to be completely redone, it was a dump and old, and small. so the current owners, we were told, are corporate lawyer DINKs from NYC who wanted suburbian life, “started” to redo the house and decided they couldnt stand the commute and wanted to move back to NYC. im not sure what they started to do, to be honest. the upstairs was almost unliveable, in fact, they were using one of the downstairs bedrooms as their master bedroom, i think. we were told they were very flexible on price (it was $469k when we saw it and had just gone on the market). if you’re willing to redo it, it’s a great little house (if you could get a lowball offer accepted). i think it had oil heat though, not sure if that matters to you. we were there at night also (and didnt go back) so i couldnt tell you about the yard.
let me know if you have more questions.
Thanks for the information. I wonder way the one that sold in 2005 is elling so soon. Realty Trace is showing a house on that block as in pre-forclosure, and it does not have a fornt lawn sighn so maybe they are int eh process of losing the house.
The cape doe slok nice on the outside, and I have family in the carpentry business so we co any renovations for just cost of materials.
I cm goingt o make an appoitnment to see both, and throw in low balls.
As far as you not buying in River Edge, good idea on your part. The taxes are out of control, so much so that Oradell voted to dissolve the regional school district because RE sends so many more kids then Oradell to the regional school ,and Oradell is subsidiing those addiional kids from RE.
I have live in the town a long time and have seen it change. I am only staying for my kids sake it would not be fair to move at this point.
Thanks again for the information. I will keep you posted.
What are the pros and cons of oil tank in a basement, I notice a lot of the older colonials have them .
bergenbubble –
definitely keep me posted, let me know what you think of the houses.
if youre willing to do work, the cape is nice. you can probably get it for a decent price (not sure about lowballing, but they’ll come down more, i would think. it definitely doesn’t hurt to try).
well, we didn’t end up so far away, but i did know about the schools. we’re DINKs and it will be a while before we have kids old enough to be in jr. high, so i wasn’t SO concerned about that. more about taxes (but that’s an issue everywhere). plus, everyone keeps telling me that the school system won’t actually dissolve, that oradell’s been threatening this for years, etc. who knows.
oh! that could be why they requested no sign on the yard.. i couldnt figure that out for the life of me. im wouldn’t be surprised if they’re in preforclosure.
Another place to check for foreclosed properties (REO) is at Countrywide:
http://www.countrywide.com/purchase/f_reo.asp
A number of these properties are MLS listed.
#71
I have an oil tank in my basement and don’t really have any problems with it. It is insured so I don’t worry about it at all.
If you are looking to buy a house with an oil tank (either in the ground or in the basement), it is imperitive that the tank is certified. This means that someone comes out and makes sure that the tank can be pressurized. Otherwise, I really like having oil heat. It seems to cost me less than others with natural gas even though the cost per gallon is much higher than it used to be. Usually, I get two deliveries a winter and the cost is about $350/delivery.
was in NYC last night. walked from 19th and 3rd up to 34th and 3rd. i’ve never seen so many restuarants in a short patch in my life. most were not even at 1/4 capacity. something tells me there are a # of parts getting overbuilt. my friend there is selling his 1 bedroom high rise in a luxury building for $800k and buying a 2/3 bedroom for $1.3 million. he hasn’t put the 1 bedroom on the market yet but he’s aware the market has softened. curious to see what happens.
#74 – i know all about oil heat, my husband just really wanted to avoid it. he said it seemed like a hassle. i see no problem with it.
thanks for the input!
Ridiculousness – Look at this $850k cape cod
http://www.realtor.com/FindHome/HomeListing.asp?snum=1&frm=bymlsid&pgnum=1&mls=xmls&js=off&fid=so&vtsort=&ss_aywr=&locallnk=&poe=realtor&ct=&st=&zp=&primaryZp=&nearbyZp=&mnprice=0&mxprice=99999999&mnbed=0&mnbath=0&typ=1&typ=2&typ=4&mnsqft=0&exft=0&exft=0&exft=0&exft=0&lid=2353931&sid=07E07F1978A2C&snumxlid=1073042486&lnksrc=00002.
It needs a 30-40% haircut. Granted it’s on 2.7 acres and has low taxes, but that’s crazy.
in regards to oil tanks, if a house has one better above ground then under. if you have an underground tank and even if its certified as not leaking and you try to pull it out of the ground in the future and a contamination is there, the EPA has to come in and you’re going to have all sorts of trouble. there are horror stories of people paying $300k for oil cleanups on residential properties. do yourself a favor. don’t buy a house with an underground oil tank. the liability is huge and don’t think an oil company contract is going to cover you.
Purchased in 1999 for $260k? Not a bad return. It’s seen it’s first $50k cut already.
jb
Actually, we did have an underground tank that was insured and they did pay to have it removed and cleaned up. Yes, the EPA did have to come out and certify that the oil was cleaned up. The cost was no where close to $300,000 but more like $10,000 to remove and clean up.
If you like a house with an underground tank, you can just put it in the contract that the tank be removed and an above ground tank put in.
lurkerA: Yes taxes are a problem everywhere, but unfortunately worse in RE than in many other BC towns.
As far as what the people are telling you, they are cluless. They claim to be informed but yet they are never ever at any governmental meetings.
As far as Oradell threatening for years, yet they have been, now they finally did somehting about it,
They hired their experts who studied the problem and made the recommendation that Oradell dissolve the district, the mayor and council then voted yes, and sent the results of the study and their request, to the BC superintendent of schools.
His decesion will be made within 6 months of the Dec 06 submit date of the study. If he OK’s it, than Oradell can then take the steps required to dissolve the district. People in RE need to wake up, Oradell is not kidding, the last 2 myor and council elections were won by candidates whose platform was addressing the school funding issue betwenn the 2 towns.
The same people who are telling you it will never happen, are the same ones who said it would never get this far, well it has.
Now whether Oradell actually goes through with it is another story. They would keep the HS and charge tuition to RE kids to attend, and RE would keep the Middle School kids and charge Oradell kids to attend.
Or Oradell will force RE to bear more of the burden, since Oradell pays more of the expenses, but RE sends over 200 more kids to the district.
There are legal precedents already in existence to have funding formulas changed as in the fairly recent Haledon and No. Haledon battle.
Either way Oradell wins, RE looses.
Bottom line is RE will be paying much more in taxes when all is said and done,much as RE residents are in denial.
I will let you know how my bidding goes. Thanks again for your help, and good luck in your new home.
bergenbubble –
thanks for your input! the person i spoke to was from RE but hasn’t lived there in about a decade.
so do you think this will be good for oradell, bad for RE, no matter what the outcome?
JB,
I just voted for this fantastic site at housingwire.com. Thanks for all your hard work, it has provided tremendous support for the past year+ while I looked to buy. I would come home from looking at houses, being ridiculed by agents, family and “friends” for not buying, and starting to wonder if I was crazy. Then I found your blog, and I realized if I was crazy, at least I wasn’t alone.
I am about to leave Manhattan to rent a house in New Jersey for a year. Time will tell if I am making the best choice, but I have to decide now, and I can make a well informed decision thanks to you.
RayC
Square building on block for whopping $42M
The old Trust Company building — once the largest building in Jersey City — in on the selling block once more.
The price tag is $42 million, according to officials.
The posting of the Journal Square landmark comes less than two years after Journal Square Properties LLC, a subsidiary of New York-based Sackman Enterprises, bought the 84-year-old building from the Trust Company of New Jersey Bank.
The building, located at 35 Journal Square, is roughly 70 percent vacant. Its largest and most visible tenant remains North Fork Bank, which operates roughly 10 percent of the building.
…
Behind the scenes, city officials are keeping their fingers crossed that the building remains office space and helps reinvigorate the office market in Journal Square. However, the first people to look at the building during the private showing were only interested in a residential conversion, say city officials.
…
City officials say the pricetag for the Trust Company building may be a bit too high, saying that more than $200 per square foot in a section of town that has yet to prove its value is out of line with the market.
LurkerA: It will definitely be good for Oradell, if they do leave, they will save over 2,300,000.00 a year in taxes, that is alot of money for a small town.
It would also mean that they would only be responsible for paying to educate the children in their own town, much as it would affect me negatively too, and I was born and raised in RE, I have to admit it is only fair.
If the shoe was on the other foot, RE residents would feel the same way. RE is buidling another big addition on their elementary schools which you have to figure also gave the impetus to Oradell to finally move ahead with the process to leave, or force Re to shoulder theri fair share of the burden
How many additional kids will that entail, that Oradell would ultimately be subsidizing as well.
How can people in RE believe that this situation could possibly be fair. Its funny Oradell was alwayss when i was growing up the more expenseive town, and supposedly snotty, and all the rest, we were the poor cousin.
Now Oradell is still the more expensive town, still snotty deopending on who you talk to, (although I never found that to be the case, and still don’t), yet oradell is the one tackling their tax problems, while RE ignores it.
I imagine that as the real estate frenzy is finally dying down, and people are reluctantly coming to the conclusion that the market is declining, these formally ignored issues will take on urgency.
The next 12 months should be very, very interesting.
What do you guys know about Greenville, South Carolina? Is it a nice place to live?
My wife’s cousin lives there…….it’s a nice city, but it’s definitely SOUTH. The weather in the summer is death. Also, I hear my wife’s cousin and her husband complaining about the price of flights to/from that area to NYC/NJ.
He has a tech job, but it is in NVA/Dulles area, so he commutes up there during the week. That should give you a sense of job opportunity.
I think he is a PeopleSoft programmer.
I should explain – SOUTH. Without dragging out the explanation, it has to do with what the role of a man should be versus a woman [e.g., recall the term “southern belle”], also the blurring of separation of church and state.
Things can be very black and white down there….and it has nothing to do with race, if you catch my drift. The most pithy and cogent comment that resonates “…you are either with us, or you are against us…”
http://money.cnn.com/2007/01/10/real_estate/bc.housing.affordability.reut/index.htm?postversion=2007011010
Potential Comps Resetter in Millburn
http://www.realtor.com/FindHome/HomeListing.asp?snum=1&frm=bymlsid&pgnum=1&mls=xmls&js=off&fid=so&vtsort=&ss_aywr=&locallnk=&poe=realtor&ct=&st=&zp=&primaryZp=&nearbyZp=&mnprice=0&mxprice=99999999&mnbed=0&mnbath=0&typ=1&typ=2&typ=4&mnsqft=0&exft=0&exft=0&exft=0&exft=0&lid=2334280&sid=07E0AC31358FC&snumxlid=1070262731&lnksrc=00002
I visited this house. It’s nice but the drawback is that it’s on a street right by the train station so it sees a decent amount of traffic. Otherwise a nice home. I believe I saw it listed last summer/spring for $709k. Relisted at $689k reduced to $649k in the fall and now at $599k. I think will sell near this price, though I was turned off by the busy street. I know the owner was desperate. They contacted us twice through our agent, because apparently not many people showed interest in this place.
The house next door sold in 4/06 for $755k and is slightly bigger. Feel sorry for these guys.
HOW’S THE CRABBY BUNCH DOING TODAY?
STILL HAPPY YOU JUST GOT IN WITH A PHONEY LOAN?…PRIDE OF OWNERSHIP…NO COMMISH..BOUGHT A HOUSE BUT DIDN’T SELL FIRST HOUSE…ESCALATING PROPERTY TAXES.
WELCOME TO MISERY…
BOOOOOOOOOOOOOYAAAAAAAAAAAA
Bob
Hard Place Says:
January 10th, 2007 at 6:33 pm
Potential Comps Resetter in Millburn
http://www.realtor.com/FindHome/HomeListing.asp?snum=1&frm=bymlsid&pgnum=1&mls=xmls&js=off&fid=so&vtsort=&ss_aywr=&locallnk=&poe=realtor&ct=&st=&zp=&primaryZp=&nearbyZp=&mnprice=0&mxprice=99999999&mnbed=0&mnbath=0&typ=1&typ=2&typ=4&mnsqft=0&exft=0&exft=0&exft=0&exft=0&lid=2334280&sid=07E0AC31358FC&snumxlid=1070262731&lnksrc=00002
I visited this house. It’s nice but the drawback is that it’s on a street right by the train station so it sees a decent amount of traffic. Otherwise a nice home. I believe I saw it listed last summer/spring for $709k. Relisted at $689k reduced to $649k in the fall and now at $599k. I think will sell near this price, though I was turned off by the busy street. I know the owner was desperate. They contacted us twice through our agent, because apparently not many people showed interest in this place.
The house next door sold in 4/06 for $755k and is slightly bigger. Feel sorry for these guys.
=========================
IT’S GETTING MISERABLE OUT THERE…USE SOME COMMON SENSE AND YOU WILL MAKE THE RIGHT DECISION.
BOOOOOOOOYAAAAAAA (sick moaning yell)
Bob
IT’S PAYBACK TIME BABY…….
YEARS OF TRASHING BUYERS…DON’T GET SUCKED IN EARLY AND PAYING TO MUCH THE PAIN HAS STARTED AND MORE PAIN TO GO..
AT LEAST 25% OFF OF PEAK 2005 PRICES PAIN FOR HOUSES TO GO..
BOOOOOOOOOOOYAAAAAAA ( sick moaning 1/2 yell)
Bob
DEPTHS OF MISERY SPRING 2008.
NO SPRING MAGIC THIS SPRING…SPRING MISERY!!!!!
MAK’EM PAY. YOU MUST BE REWARDED FOR YOUR PATIENCE AND EFFORT WAITING OUT THIS LUNACY.
BOOOOOOOOOYAAAAAAAAA
Bob
Bob, did you go vote for the blog for J.B?
WHERE ARE THE BARGAINS? THERE ARE NO BARGAINS….BUT YOU CAN PAY A RATIONAL PRICE.
“AT LEAST” 25% OFF OF BLOATED PEAK 2005 HOUSE PRICES (MORE THE BETTER)condoshacks beware alot more!
BOOOOOOOOOOYAAAAAAAAA
Bob
Chicago, #89, see third item:
http://www.wavsource.com/news/20010911a.htm
#91, Hard Place, that house was listed at $749K last summer. Now at $599K, eh?
Note, in December 2005, the house right next door, that isn’t as nice, was listed at $750K and sold in one day at asking price.
The party is just getting started Greedy Grubbers!
More pain to come.
A friend of mine is buying this house in kinnelon, he only offered 1ok lower and settled at 530 and sellers closing terms. I am a big beleiver in this bubble and feel this house will be worth 400k by next year, why not it sold in July 04 for 380k. Any advise i can give my friend without losing a friendship. Thanks
Here the mls , what you guys and girls think?
MLS ID#: 2349309
I love reading all the posts, perfect time to find bargains.
Known fact 1/3 homes 3 years ago got a 3 year interest only loan, which means they will all need to refinance or sell there homes or foreclase this year
Any of you guys need to refinance or looking to purchase email me or reply,
UnRealtor,
Think they are smart to start cutting prices quick. They’ll be one of the least expensive options around. Too bad they didn’t think about doing that last summer. They probably could have walked away w/ $100k more. I wouldn’t be surprised if this went for around $550k.
By the way, can anyone tell me the selling price for MLS 2262998. I put a bid on this one last fall, but one other bidder stepped in and it went into a bidding war. I only went up about $20k from my 20% lowball. I thought it was a decent live & rent multi family situation. Apparently my offer got blown out of the water. I think they paid near asking. I’m sure it closed by now.
Thanks.
chicagofinance,
Excellent information. Thanks :)
Fla. trailer park OKs megabucks sellout
Associated Press Writer
Associated Press
BRINY BREEZES, Fla. – Residents of this trailer-park town sitting on beachfront property have voted overwhelmingly to sell their community to a developer for more than $510 million, which could make most of them millionaires.
Some residents bought their homes for as little as $35,000.
The contract isn’t official – and residents don’t get any money – until 2009. If the sale goes through, nearly every owner will get more than $1 million.
http://tinyurl.com/yg4ts6
http://forum.brokeroutpost.com/loans/forum/2/84713.htm
“National City Mortgage” goes down?
National City Mortgage is a unique mortgage lender with the financial strength and stability that make us the 9th largest mortgage originator in the nation. This ranking was earned in fiscal year 2004 when we funded over $65 billion.
Residents of this trailer-park town sitting on beachfront property have voted overwhelmingly to sell their community to a developer for more than $510 million, which could make most of them millionaires.
WickedQuiver #106,
Damn I wish I had their luck.
guidelines or no guidelines, the market is in the process of self correcting.
This is Fremont’s new lending policy -(Fremont is one among the top 5 in subprime lending)
http://forum.brokeroutpost.com/loans/forum/2/83075.htm
We are no longer doing 100% stated purchases
Max 90% LTV on stated Wage Earner
Max 95% LTV on stated self employed
We are still doing 100% stated refinances with a middle score of 640 and required tradelines
We now require 12 months seasoning from purchase date to use new appraised value
We are no longer doing seller held seconds either.
Tim (#100)-
Since you’ve seen the future, could you tell me whether GOOG will top $525 by 3/1/07?
Mortgage Guy (102)-
Note that Mr. Moderator here has chosen not to monetize this site. You are dissing him and his efforts big time by trolling for business.
Geez, where did everybody go?
Oh…probably puking their innards out after Bush’s speech.
Hehe, just wondering that myself.
Maybe JB brought MortGuy down on himself…I heard he might have scored a dork econ book out of the site for Xmas.
Is that monetizing it?
Dear Mortgage Guy,
beat it. Go sling your desperate jargon elsewhere.
yours truly,
SAS
“House passes minimum wage increase”
Who cares anymore? Thats why we have the illegal mexicans.
You can make more money on welfare then the minimum wage, anyone in Harlem will tell you that.
Interesting observation in east orange.
Goto the bus stations and look for working commuters at 8am, then…goto the welfare line
at 8am, the damn line is around the block.
yup, only if I was born so called “poor”. I’d have it made, thanks be to you….the sucker tax payer.
Yup.
SAS
Dear Mortgage Guy,
I am a very rich king in the republic of Nigeria. I want to give you $990000 by bank transfer. please reply to me or post your bank routing number and account here so i can transfer my funds.
you buy me house. I pay you money.
very gratefully,
Borat
Here’s a boom that’s over…David Spade. OMG, here he is on CBS, shimmying in front of some nameless doofus and the guy who played Elaine’s boyfriend on Seinfeld. He’s about a year away from doing Kutsher’s.
Joe Dirt was a career-killer.
>>If you like a house with an underground tank, you can just put it in the contract that the tank be removed and an above ground tank put in.
try it out and watch the sellers tell you to go scratch. that’s the usual response from my experiences.
http://www.rgemonitor.com/blog/roubini/172081
#91, #99
“The house next door sold in 4/06 for $755k and is slightly bigger. Feel sorry for these guys.”
Those guys brought the house 10 years ago for $288k. It’s not like they’re losing money on it, even adjusted for inflation.
“Those guys brought the house 10 years ago for $288k. It’s not like they’re losing money on it, even adjusted for inflation.”
Who said anyone was “losing money”?
The point is, it’s a new comp. When the house next door sold briskly for $750K eighteen months ago, and this house is down to $599K, that speaks volumes regarding how much the market has changed.
Four more years of declines to come…
“Joe Dirt was a career-killer.”
Was it alive to begin with?
His career probably started and ended with Tommy Boy:
http://www.amazon.com/Tommy-Boy-Schnike-Chris-Farley/dp/B0009W5J1O
Ooh. That’s a very interesting article about E. Brunswick. But how many condos can they buy for less than a million? Even with no money down, can they even use the money for conversion/long term maintenance on more than a handful?
Won’t the twp have to increased garbage removal, expected school enrollment increases, etc., after selling?
bergenbubble – #85
Thanks for all the perspective. It’s such an interesting situation for two tiny little towns. I’m impressed Oradell is actually doing something about it and not just continuing to whine (which is what I thought the situation was).
so are you also looking in oradell? or just RE?
ummmm… Joe Dirt actually had a very high profit margin, believe it or not.
Seneca #127,
All that proves is that consumers are idiots :P
Lurker A: I will also look in Oradell, and I am pleased that they are doing soemthing about taxes, even if it ultimately hurts me if I stay in RE.
It is better that the deny and ignore attitude in RE. I will keep you posted.