March Existing Home Sales are due out at 10:00am EST this morning. The consensus estimates put the figure at 6.45m, down from 6.69m in February.
From MarketWatch:
Home prices fall at fastest rate in 13 years
U.S. home prices continued to fall in February, with 17 of 20 major metro areas seeing lower prices in February compared with January, according to the S&P/Case-Shiller home price index released Tuesday.
Prices are down 1.5% in 10 major cities in the past year, the fastest decline in 13 years.
In 20 major cities, prices are down 1% in the past year.The biggest declines over the past year were in Detroit, Boston and Washington. Seattle, Portland and Charlotte have seen the biggest increases in the past year.
“Declines in home prices are showing no signs of turnaround,” S&P said in a release.
A year ago, prices were rising 14%.
The report comes amid heightened concerns about the housing market.
Falling home prices will exacerbate credit problems, because many borrowers will not be able to refinance their loan or sell their house because they owe more than it’s worth.
The 10-city Case-Shiller index turned negative in mid-1990 and remained negative for much of the next three years. Prices did not return to the peak seen in October 1989 until January 1998.
The Case-Shiller index is considered to be a superior gauge of home prices compared with the median sales-price data released by the Commerce Department or National Association of Realtors, because it tracks multiple sales on the same property and is therefore not influenced by a different mix of homes sold in a period.
From MarketWatch:
Sales of existing homes plunge 8.4% in March
Sales of existing homes plunged 8.4% in March to a seasonally adjusted annual rate of 6.12 million, the lowest in nearly four years, the National Association of Realtors reported Tuesday. It was the largest percentage decline in sales since January 1989. Economists were expecting sales to fall to 6.45 million. The median price of an existing home fell 0.3% year-over-year to $217,000. The inventory of unsold homes on the market fell 1.6% to 3.75 million, representing a 7.3-month supply. Sales of condos were unchanged, while sales of single-family homes dropped 9.5%. Sales fell in all four regions. “This number reflects subprime lending” as well as the cold weather in February, said David Lereah, chief economist for the real estate group.
From Bloomberg:
Subprime Bondholders May Lose $75 Billion in U.S. Housing Slump
Bond investors who financed the U.S. housing boom are starting to pay the price for slumping home values and record delinquencies in subprime loans.
They will lose as much as $75 billion on securities made up of millions of mortgages to people with poor credit, says Pacific Investment Management Co., manager of the world’s biggest bond fund. Some of the $450 billion in subprime mortgage-backed debt sold last year has lost 37 percent, according to Merrill Lynch & Co.
BlackRock Inc., AllianceBernstein Holding LP and Franklin Templeton Investments are vulnerable because investors have replaced banks and thrifts as the primary source of money for U.S. mortgages. More than $6 trillion of mortgage bonds are outstanding, dwarfing the amount of U.S. government debt by about 50 percent.
“Bond investors will be the ones who will take the losses,” not the banks, said Scott Simon, who oversees $250 billion in asset-backed securities at Newport Beach, California- based Pimco, a unit of insurer Allianz SE in Munich.
From The Record
Buyers will like spring selling season
…
Karl Kern, who has tracked housing statistics in the area for two decades, said the number of houses now on the market in Bergen County — about 6,000 — matches the long-term average for this time of year.
House sales and inventory (1-4 Family Homes)
Sold
Bergen County
First quarter ’07: 1,870
First quarter ’06: 1,901
On the market
Bergen County
First quarter ’07: 6,013
First quarter ’06: 6,174
Source: N.J. Multiple Listing Service. Data as of April 8
—————————–
I wish they had included previous years along with Mr. Kern’s two decades of data.
NJMLS Bergen County SFH (Single Family Homes), 2-4 Family and Condo, Co-op & Townhouses Stats as of 4/24/07
First Quarter Sales
’07 1,884
’06 1,901
’05 2,148
’04 2,136
’03 2,010
’02 2,124
’01 1,823
’00 1,883
First Quarter Inventory
’07 6,113
’06 6,088
’05 3,776
’04 3,726 (Last year historical inventory is tracked by NJMLS)
Thanks Rich.
jb
From the Star Ledger:
Jersey’s debt rates 4th among the states
New Jersey continued to dig its taxpayers deeper into debt last year, but the pace of the digging was the slowest in five years, dropping the state from third to fourth among the nation’s top debtor states, a Wall Street report shows.
New Jersey closed out last year with $33.7 billion in public debt, the fourth-heaviest debt load among states by every measure used by Moody’s Investors Service in preparing its annual State Debt Medians report. Only California, New York and Massachusetts ranked higher.
New Jersey has been among the nation’s five most indebted states since 1998, when public officials borrowed to pay for everything from public employee pensions and school construction to business incentive grants and the state’s annual operating expenses.
With about $3 billion allocated to repaying the debt each year, state Treasurer Brad Abelow and Gov. Jon Corzine have said the state’s credit card is maxed out. They are considering leasing operating rights to the New Jersey Turnpike, the State Lottery or some other high-profile state asset to pay down the debt so that they can borrow the additional billions of dollars needed for school building, highways and open-space acquisition.
New Jersey’s debt load comes to $3,317 for every resident, triple the national average and $41 higher than the 2005 New Jersey average, according to the Moody’s report, which was published last week.
The increase in state debt last year, $800 million, was the smallest since 2001, the report shows. While New Jersey was taking a breather, Massachusetts piled on $2.5 billion in new debt, pushing it past New Jersey on the list of top debtors.
A decade ago, New Jersey’s debt load averaged just over $1,000 per resident, eighth in the nation.
Off Topic
From The Record
Builder’s new home breaks all the molds
…
“Stone and wood square columns, and the long, low horizontal line of the front porch suggest the early 1900s Arts and Crafts/Craftsman style.”
———-
What books were they using for a reference? There is nothing about this house that reflects Arts and Crafts era style (let alone philosophy) other than some cabinets. And even that’s a stretch.
Rich
Here’s a novel idea: if we don’t have the money to do something, DON’T DO IT! DON’T LEASE/SELL OFF OUR ASSETS IN ORDER TO BE ABLE TO BORROW MORE…JUST DON’T SPEND MONEY WE DON’T HAVE!
Good God, I can’t believe Corzine worked at GS. I now totally believe the stories about them jumping for joy when he left.
Rich (5)-
What a POS! Arts & Crafts? Yeah…from the Tony Soprano school. Stickney, et al must be rolling over in their graves.
“Bond investors will be the ones who will take the losses,”
[1],
And Chuck Schumer wants investors to participate in the bailout. Chuck, these investors were preyed upon. Wall Street took advantage of these unfortunate souls. Please include them in any impending bailout plans.
By the way Chuck, why is it everytime you speak about bailouts/protectionism the dollar gets lashed?
That house is the antithesis of the Arts & Crafts movement. It embodies everything that the movement strove not to be.
A McMansion by any other name…
jb
NAR to put out used home sales report tomorrow. Watch The Corrupt David Lereah spin his ass off
http://housingpanic.blogspot.com/2007/04/nar-to-put-out-used-home-sales-report.html
Don’t be snowed when The Corrupt David Lereah spins the horrific drop in home sales by comparing March to February, when any idiot knows the real and only comparison is March 2007 vs. March 2006.
Watch the clueless and complicit MSM go with the March vs. February number. Also watch the MSM not question the median price number, which doesn’t include incentives and cash back.
And watch the MSM take TCDL’s “it was the weather” excuse and tell the frightened masses that “it appears we’re bottoming”, even though unsold and unwanted inventory will be soaring to close to a year’s supply in many markets.
Regardless of the lies, deception and spin, the numbers tomorrow are going to be truly horrific. Even the NAR won’t be able to hide the truth (spin as they may).
“Subprime Silliness”
“What do you say to someone who, essentially, got something for nothing and is now on the verge of losing it? Too bad, but maybe you’ve learned a lesson? That sounds about right to us. Anything but “help is on the way.”
http://www.investors.com/editorial/editorialcontent.asp?secid=1501&status=article&id=262221397198594
Interesting comments from USG, from MarketWatch:
[USG] USG says housing market has not shown ‘meaningful’ recovery
8:35 AM ET, Apr 24, 2007 – 11 minutes ago
[USG] USG sees residential downturn continuing through 2007
8:35 AM ET, Apr 24, 2007 – 11 minutes ago
Comments from: http://biz.yahoo.com/prnews/070424/aqtu060.html?.v=9
Subprime bailouts: How they work
There’s some state-sponsored help on the way for subprime borrowers.
NEW YORK (CNNMoney.com) — “They got themselves into this mess and I don’t want my tax dollars used to get them out of it.” That’s the attitude of many when it comes to bailing out subprime borrowers from bad loans.
More at: http://money.cnn.com/2007/04/24/real_estate/bailout_plans_how_they_work/index.htm?cnn=yes
Grim (12)-
USG is a good bellwether/proxy for housing. However, I wouldn’t run to short these guys…it’s one of Buffett’s biggest plays over the past year.
BTW…that’s Stickley, not Stickney. The photo of that alleged “Arts & Crafts” POS really got me going.
The Kathleen Madigan video is worth watching (for a laugh)..
jb
BC (8)-
Let Schumer talk. You can’t pry him away from a mike or camera, anyway.
Every time he opens his mouth, I swing my mining pickaxe.
I wouldn’t run to short these guys…
It wasn’t my intention to create that impression.
jb
NAR: Lereah’s Fat Balloons!
http://www.paperdinero.com/BNN.aspx?id=141
Lereah, who apparently cannot get himself to say the word “bubble”, speaks about his new book and the fat “balloons”. Lereah suggests that there are some really good buying opportunities in roughly 75% of the country. Hmm… Boston a good buy? Not yet but as for the Smokey Mountains, all I can say is Dollywood baby!
Originally aired on: 4/10/2007 on CNBC
Running Time: 2 minutes 49 seconds
Clot [16],
You’re right, he should keep on chirping. A free consultant.
Ugh! I live in an Arts and Crafts style home…and that is definately not even close. For one, my home has actual character. Big window does not equal character.
The February Case Shiller Home Price Index is out, and it’s not pretty..
Home prices fall at fastest rate in 13 years
U.S. home prices continued to fall in February, with 17 of 20 major metro areas seeing lower prices in February compared with January, according to the S&P/Case-Shiller home price index released Tuesday.
Prices are down 1.5% in 10 major cities in the past year, the fastest decline in 13 years.
In 20 major cities, prices are down 1% in the past year.
Fritz over at the Housing Derivatives blog has the data posted:
Housing Derivatives – S&P/Case-Shiller February 07 Data
From Reuters:
US home prices fall in February – S&P/Case Shiller
Prices of existing U.S. single-family houses fell in February, according to an index of major metropolitan areas released on Tuesday.
The composite month-over-month Standard & Poor’s/Case-Shiller Home Price Index of 20 metropolitan areas fell 0.5 percent to 201.19 from January, for a 1.0 percent year-over-year drop, S&P said on its Web site.
The composite month-over-month Standard & Poor’s/Case-Shiller Home Price Index of 10 metropolitan areas showed a 0.5 percent monthly decline in February, to a 219.94 reading, or a 1.5 percent year-over-year decline.
Sallie Mae profits slump
Student loan lender stung by losses on derivatives and hedging; misses estimates by wide margin.
http://money.cnn.com/2007/04/24/news/companies/sallie.reut/index.htm?postversion=2007042409
Sallie Mae, a student loan company that last week agreed to sell itself to private equity firms and banks, said Tuesday that first-quarter earnings fell, hurt by wider losses on derivatives and hedging.
From Bloomberg:
S&P/Case-Shiller Home Price Index Fell 1% in Year
Declines in home prices in 20 U.S. metropolitan areas accelerated in the 12 months ended in February, a private survey showed today.
Values fell 1 percent from February 2006 after dropping 0.1 percent in the year ended January, according to the S&P/Case- Shiller home-price index. January’s decrease was the first since the group started keeping year-over-year records in 2001.
Slow demand has left a glut of homes for sale on the market that’s forcing sellers to reduce prices, economists said. A rise in foreclosures may add to the number of unsold homes, suggesting prices will be slow to rebound and housing will continue to limit economic growth. Sales of existing homes probably fell last month, the National Association of Realtors is projected to report later today.
“There’s just too much inventory of unsold homes, and simple supply and demand says that prices will have to come down,” said Lindsey Piegza, a market analyst at FTN Financial in New York. “We expect prices to be under continued downward pressure for a while.”
The group’s 10-city composite, which has a longer history, dropped 1.5 percent in the 12 months ended February, the most since October 1993.
Clot,
Did you see this?
http://dontmesswithourchocolate.guittard.com/
Hershey Battles Chocolate Connoisseurs Over Selling `Mockolate’
Would chocolate containing trans fats and sugar substitutes taste as sweet as the real thing? Hershey Co. and other candy makers say yes.
The Chocolate Manufacturers Association, whose members include Hershey, Nestle SA and Archer Daniels Midland Co., has a petition before the U.S. Food and Drug Administration to redefine what constitutes chocolate. They want to make it without the required ingredients of cocoa butter and cocoa solids, using instead artificial sweeteners, milk substitutes and vegetable fats such as hydrogenated and trans fats.
jb
Can someone please get me info on this listing: 2384139 (GSMLS, I think). An address and how long it has been on the market?
Thanks,
AK
Oh boy, talk about piling on bad news..
From Marketwatch:
Sales of existing homes plunge 8.4% in March
Sales of existing homes plunged 8.4% in March to a seasonally adjusted annual rate of 6.12 million, the lowest in nearly four years, the National Association of Realtors reported Tuesday. It was the largest percentage decline in sales since January 1989. Economists were expecting sales to fall to 6.45 million. The median price of an existing home fell 0.3% year-over-year to $217,000. The inventory of unsold homes on the market fell 1.6% to 3.75 million, representing a 7.3-month supply. Sales of condos were unchanged, while sales of single-family homes dropped 9.5%. Sales fell in all four regions. “This number reflects subprime lending” as well as the cold weather in February, said David Lereah, chief economist for the real estate group.
From Marketwatch:
U.S. March existing-home sales fall 8.4% to 6.12 mln pace
U.S. March median home price down 0.3% year-on-year
U.S. March existing-home inventory down 1.6% to 3.75mln
March existing-home sales drop largest since Jan. 1989
March existing-home sales lowest since June 2003
Third piece of bad news this morning.
From Bloomberg:
Consumer Confidence Index in U.S. Declined to 104.0 in April
Consumer confidence in the U.S. declined to the lowest level in eight months in April, sapped by concerns about rising gasoline prices and a wave of mortgage defaults.
The New York-based Conference Board’s index of consumer confidence fell to 104.0 this month from 108.2 in March. The index averaged 105.9 last year.
…
Economists expected the confidence index to fall to 105 in April from an originally reported 107.2 in March, according to the median of 67 forecasts in a Bloomberg News survey. Estimates ranged from 102 to 107.5.
The Conference Board’s measure of present conditions fell to 131.3 from 138.5. The gauge of expectations for the next six months fell to 85.8 from 87.9.
Interesting that inventory declined, and condo sales remained unchanged.
We will probably have a rally because 1 of the 7 data points was positive :)
“U.S. March existing-home inventory down 1.6% to 3.75mln”
I’m still waiting for the NAR to update the link on their research pages..
jb
Yes David, it was the weather’s fault. LOL!
We will probably have a rally because 1 of the 7 data points was positive :)
While inventory did dip downwards, and that is a positive, the drop in sales caused absorption rates to jump rather significantly, a clear negative.
jb
More misery coming in 2008.
IT’S GOING TO GET ALOT WORSE.
FACE MASSIVE MISERY IN 2008.
ACCEPT IT!
BOOOOOOOOOOOOYAAAAAAAAAA
Bob
Existing home sales tumble in March: biggest one-month decline since 1989
http://www.msnbc.msn.com/id/18289082/
Existing home sales tumble in March
Trade group: Biggest monthly slide in nearly two decades
Updated: 2 minutes ago
WASHINGTON – Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather and increasing problems in the subprime mortgage market, a real estate trade group reported Tuesday.
The National Association of Realtors reported that sales of existing homes fell by 8.4 percent in March, compared to February. It was the biggest one-month decline since a 12.6 percent drop in January 1989, another period of recession conditions in housing. The drop left sales in March at a seasonally adjusted annual rate of 6.12 million units, the slowest pace since June 2003.
The steep sales decline was accompanied by an eighth straight fall in median home prices, the longest such period of falling prices on record. The median price fell to $217,000, a drop of 0.3 percent from the price a year ago.
It’s payback time.
You wait for times like these then you pounce on it at the right time and opportunity.
BLEED’EM DRY!
BOOOOOOOOOOOOOYAAAAAAAAA
Bob
I am going to pick off a few expensive toys at dirt cheap prices from some debt zombie, but they do not know it yet.
They will shortly.
hehehehhehe
BOOOOOOOOOOOOOYAAAAAAAAAA
Bob
“Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather ”
It looks like we had bad weather for 16 months straight.
It all doesn’t mean sh*t to me as the prices the masses are asking are still straddling absurdity. When they’re standing out in the streets with tears in their eyes and signs clutched desparately in their wretched little paws, then it’ll be time to buy.
I hear we’re expecting another 2-3 years of bad weather.
yOU AIN’T SEEN NOOOTTTT”’ING YET!
2008 Massive misery.
RE will be categorized as a bad investment.
Either accept it now and panic first or ride it down to the bottom.
hehehhehehehe
BOOOOOOOOOOOOYAAAAAAAAA
Bob
With monthly sales figures dropping the past few months, I figured the inventory would have inched up a little.
It dropped a little too this month, does that mean that fewer people are on the market?…or maybe they’re all doing FSBO now!
any interpretations here?
Will Euro break the all time high today!
One observation….
The psychology is definitely changing. From 03-06, everyone was telling me buy now. Because real estate can’t never go down in XXX. It is the guaranteed investment. Don’t be a renter-sucker.
The same people are telling now that:
We bought at the top. But so what, we are staying for a few years. We will ride it out.
Let me sell my condo / investment property before it is goes down some more.
(This is the best) I had to lower my OLP by 12% to sell. It is the only way to sell in this market (it’s in Monmouth County)
Bubble is normally herd/psychology driven rather than fundamentals. We have crossed the threshold for THERE IS NO BUBBLE. It will get really interesting in the next few years. I hope fundamentals will take over.
I sampled a few properties for Buy/Rent estimate in Summit. Looks like these properties need to drop 30% before it makes to buy.
CC
Some nice realtor PhotoShop sky and clouds work on this one:
http://newjersey.craigslist.org/rfs/314763497.html
MJ [45],
Today, tomorrow, next week, etc…. Does it really matter?
Not seasonally Adjusted YOY sales ( whatever it means ) down 13.4% for Single Family, 10.1 for Condos.
We will probably have a rally because 1 of the 7 data points was positive :)
While inventory did dip downwards, and that is a positive, the drop in sales caused absorption rates to jump rather significantly, a clear negative.
True. But I get njrebear’s point (I think).
It certainly does seem lately like the market rallies on any scrap of perceived good news, while quickly getting over anything negative. Even negative news is often spun as positive…”i.e. the housing market is tanking….good, the Fed can lower rates…time for a market rally”.
cr has posted his graphs
http://calculatedrisk.blogspot.com/2007/04/march-existing-home-sales.html
In other news, Toyota overtakes GM in global sales.
http://www.msnbc.msn.com/id/18286221/
A few key points:
1) March is the beginning of the spring selling season.
2) Inventory is at a record levels for March.
3) Existing home sales are reported at the close of escrow. This means these contracts were mostly signed in January and February. So these numbers are mostly prior to the subprime implosion of mid-February.
from the above link
http://www.marketwatch.com/news/story/alcatel-lucent-shares-volatile-after-operating/story.aspx?guid=%7B41AFD887%2DB45E%2D4F96%2D85F7%2D4E57A977F136%7D
Alcatel-Lucent’s in the process of cutting 12,500 jobs over three years, up from an original target of 9,000. At the time of the merger, the company said the tie-up would yield annual cost savings of 400 million euros in 2007, then upped that target in January to 600 million euros, but without providing any indication as to where these savings would come from.
Russo said the company cut 1,900 jobs during the first quarter, a figure that Goldman Sachs said was ahead of its restructuring expectations.
“Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather ”
I don’t remember barely any snowfall at all this winter. How is this attributable to bad weather? What a crock
46…
I just got out myself…i was looking at relocating anyhow and sold a condo I had down the shore…bought in early 05, sold in 07…accepted a little less than my asking but still made a little extra…How did I make that little extra? FSBO! and I advertised it and closed in
How come when sales go up, no one ever offers the caveat, “its only because of the good weather”?
less than 60 days too…
(#56 got cut off)
Debt zombie = classic
I told a realtor friend of mine at dinner last week I had renewed my lease in hoboken for another year and he asked me why I didn’t buy my own place since I have the $, I made up some stuff about not wanting to move again, I wanted to say because “I am not a f*cking moron” but refrained so as not to hurt anyone’s feelings.
Got the same question from guy who own’s in the condo building I am in, “why don’t you buy now prices have gone down some?”, said the same thing about the hassle of moving, reality is I wanted to say “You ain’t seen nothing yet” but reality is most people in my building were peak buyers and I don’t want to piss them off. Good people caught up in the bs.
CC, it will be interesting to talk to those “long-term” owners after they’ve spent five years in technical default on their mortgage while simultaneously getting pounded by the property tax man.
What goes up, must come down
What must rise, must fall.
And what goes on in your mortgage
Is the writing on the wall.
If house prices must fall
Why pray for a miracle at all?
And that HELLOC in your mind
Did turn you blind.
But all things must pass
Even a bankruptcy won’t last.
“How is this attributable to bad weather? What a crock”
x [55],
Major crock.
It was one of the warmest Jan on record. The cold did not come until Feb.. I should know, my in laws were up from Fla and decided to stay longer because of the mild weather at that time. Just my luck.
“On Saturday afternoon, the temperature reached 72 degrees in Central Park, tying the all-time high for January and easily busting the old record for Jan. 6. It cooled off to the 40s by the evening, but Sunday’s high was expected to be 50 degrees.”
http://www.newsday.com/news/local/wire/newyork/ny-bc-ny–wackywinter0106jan06,0,1511066.story?coll=ny-region-apnewyork
Was in Florida for the weekend (outside orlando). Their real estate market is tough as well. We were there 6 months ago and the same homes are still for sale.
As for blaming low sales on the weather, I wonder what the weather was like in March of 2006 as compared to this year. If real-estate is local, why blame national sales on the weather? Just because it’s bad on the east coast doesn’t mean the west coast is suffering..
credit tightening has not even shown up yet in the numbers and already we’ve got the biggest drop in sales in nearly 20 yrs
now that you need minimum 5% down, the vast majority of 1st time buyers are eliminated. Spring selling season = DOA
If it hasn’t done so already, the Titanic just left New York harbor
Billz #56, how did you, as a “layman,” manage to do that?!?!?
Don’t you know there’s sophisticated “marketing” involved? And other secret knowledge that you can never possess?
Unrealtor #66,
Yeah, and don’t forget, realtors only want the best for you.
the peak selling season hasn’t arrived yet. contracts signed were in the winter so i wouldn’t get my panties in a bunch about the demise of the market. i’ve seen a few houses get listed during this time with ‘feeler’ prices above what the market would seem to bear. some are now lowering. the just listed home prices so far look like prices comparable to last year’s selling prices. we’ll see if they go lower if demand doesn’t materialize. remember most folks don’t start looking for houses until this point forward. the jury is still out on what will happen but one thing’s for sure there’s a lot of inventory out there so sellers will have to compete more for business than in year’s past. i’m guessing the last straw will be a price adjustment.
HeHe,
I agree. But there appears to have been a “rally” in the hoboken market as near as I can tell. I believe several units in my building sold since the beginning of the year, and I’m curious what they sold for (one was on the market for 9+ months).
I think part of it is obviously the wall st. money, but I think they also bought the Greenspan line of “the worst appears to be over”, as well as being inclined to “buy on the dips” in the market.
Rent/Own ratios still don’t make any sense though.
Where do you see 5% down? When I call one of those mortgage brokers, it becomes 10% down.
If the sellers remain adamant they will shoot themseleves in the foot.
Will rent for another year atleast , save for 20% down , create mortgage buffer for 3-4 months.
Not interested in those inflated prices, sellers come down 20-30%, then there will be a little movement.
– KBR
But greenspan said that the worst of housing is over, so it must be true.
he he he
“i’m guessing the last straw will be a price adjustment.”
At this point the “current” last straw is the tightening of lending standards. However, there will be more last straws going forward. The consequences for each will be lower prices. An “adjustment” is the most positive scenario possible for the bulls. Unfortunately, a good, old fashioned bust is heading this way.
#26 jb:
I’m pretty particular about my chocolate, some would say “chocolate snob”. I can’t eat “white” chocolate and milk chocolate doesn’t really do it for me either. To label vegetable oil products with no trace of cocoa as “chocolate” because of “changes in technology” is offensive.
BTW, ever try Martine’s chocolates? If you haven’t you should. I keep their menu on my desk.
Prices will never go down in Bergenfield. Such a great school system and ultra low taxes truly make Bergenfield unique.
#57 RayC:
When sales go up it is driven by fundamentals, like job,income growth, immigration etc. When it goes down it is weather related.
David Liareah !!!! What an A-ss
#68 Richard:
What happened to your wall street friends?
Tell them to BUY, BUY BUY !
Bonds rally.
Stocks rally.
So March sales reflect Jan and Feb contracts.
Do this mean that March sales should be below Feb sales, which reflect Dec and Jan contracts?
HEHEHE Says:
April 24th, 2007 at 11:07 am
Debt zombie = classic
I told a realtor friend of mine at dinner last week I had renewed my lease in hoboken for another year and he asked me why I didn’t buy my own place since I have the $, Got the same question from guy who own’s in the condo building I am in, “why don’t you buy now prices have gone down some?”
HEHEHE: do you live in HTB? Sorry, Robin and I just shut down the site. Are there other converts in town besides the place than NJGal lives? I guess there are the small walk-up types.
BC Bob Says:
April 24th, 2007 at 12:02 pm
a good, old fashioned bust is heading this way.
Bost: measurements?
Here’s the real headline, care of HP:
http://housingpanic.blogspot.com/2007/04/flash-existing-home-sales-crash-13-vs.html
USED HOME SALES CRASH 13% VERSUS PRIOR YEAR, MEDIAN PRICE NOW DOWN AT LEAST $13,200 OR 6% FROM PEAK ACCORDING TO FLAWED NAR STUDY. UNWANTED HOME INVENTORY UP AT LEAST 17% VERSUS PRIOR YEAR TO 7.3 MONTH SUPPLY. NAR MOUTHPIECE DAVID LEREAH HILARIOUSLY BLAMES HOUSING CRASH ON WEATHER.
OT Yankee fans: I am a Met fan, so I don’t pay close enough attention. What I’ve seen in the last few days is: (1) bringing Mariano in the 8th (2) bringing Pettitte in the 5th (3) calling-up Hughes. WTF is going on over there? These are the moves of a desperate manager and GM? Are these guys on the hot seat? It’s freakin’ April…..didn’t they start 11-19 a few seasons ago and then win well over 100 games. Stupid. Am I off-base?
BTW – to anyone with newborns, there is just a great article in the WSJ today
Researchers Target Toll Kids Take on Parents’ Lives By RACHEL ZIMMERMAN April 24, 2007; Page D1
Ask grim for it……
March ’07 EHS graph from Marketwatch:
https://njrereport.com/images/mar07ehs.jpg
jb
Researchers Target Toll Kids Take on Parents’
I love my little girl (3 weeks old), but I haven’t slept a full night in 3 weeks. She is definitly taking a toll on us!
Chi [81],
Back to 2001.
Yankees? A new blog would have to be created.
Grim,
If you have a copy of the article Chi speaks of in 81 could you forward it to me?
Thanks, Rich
Was a little surprised to read such a bearish piece on Realty Times..
How to Advise Sellers in a Buyer’s Market!
From the WSJ:
ECONOMISTS REACT
Economists Mull Whether Decline
In Home Sales Is Just About Weather
This looks awful but it is surely just the reversal of the favorable weather effects which boosted Jan & Feb sales. After two months above the level implied by the pending sales index, March activity has undershot… Sales depend on what happens both to the level of mortgage applications and the terms on which applications are granted. In the wake of the subprime blowup, it seems reasonable to expect a higher application rejection rate and tighter terms, but they are not visible yet. –Ian Shepherdson, High Frequency Economics
* * *
The broad-based nature of the sales weakness suggests that this is more than just a weather story… The median sales price rose 1.6% in March, but is down 0.3% from a year earlier. However, as we have stressed in the past, this measure can be heavily influenced by shifts in the mix of home sold. A better gauge of underlying home price trends — the S&P/Case-Shiller index — shows a steady deterioration in home values in recent months and is now down 1% from last year. –Morgan Stanley Research
* * *
Ugly is the simplest word for this report. The housing market is still in the tank and while every time we get a huge decline in sales we move closer to the bottom, it is hardly obvious when we will actually see that bottom. –Naroff Economic Advisors
* * *
Though lower sales were widely expected to offset the unexpected strength of earlier months, the breadth and depth of this decline leaves little doubt that the housing sector remains in the doldrums with a turnaround not yet on the horizon. –Nomura Economics Research
* * *
Weak data correcting last month’s quirky lurch higher… Lead indicators such as mortgage applications and the NAHB survey suggest resales may now flatten out in the short term at least. –Richard Iley, BNP Paribas
* * *
Sluggish sales have kept inventories of unsold homes at very high levels. This, in turn, has pressured prices, which have been falling for the past 8 months. Although home sales appear to be stabilizing, the housing correction is not complete and home construction will continue to shrink until more of the inventory overhang is eliminated. –Steven A. Wood, Insight Economics
How much will gas prices drop this week? Now that confidence is down the WH will ask the oil companies to drop it….
I bet .15 a gallon.
“Home sales: Worst drop in 18 years”
http://money.cnn.com/2007/04/24/news/economy/home_sales/
“Now that confidence is down the WH will ask the oil companies to drop it….”
SV,
The WH can ask whomever they want. Unfortunately, the crack spread indicates that prices will continue to rise.
“Home prices set for first drop in 40 years”
http://money.cnn.com/2007/04/11/news/economy/home_prices/
“Home builder: Spring hasn’t sprung”
http://money.cnn.com/2007/04/10/news/economy/drhorton_warning/
“New home sales: Slowest in 6 years”
http://money.cnn.com/2007/03/26/news/economy/new_home_sales/
“Home prices: Don’t expect quick rebound”
http://money.cnn.com/2007/03/09/news/economy/home_price_slump/
thatbigwindow@20: I’m so jealous! ;) I love Arts & Crafts houses. There are precious few of them in my area, alas.
Researchers Target Toll Kids Take on Parents’
I love my little girl (3 weeks old), but I haven’t slept a full night in 3 weeks. She is definitly taking a toll on us!
My girls are now 8 and 4-1/2, but I remember well how totally exhausting and stressful those first years can be, it was like an endurance test. I feel your pain! But looking back now it feels like it just flew by.
The reward for your effort is right around the corner.
Just an example of how transaction costs can really hurt short-term property owners in a flat market.
MLS# 2361095 – Cedar Grove
Purchased 6/2005 – $464,900
Sold 4/2007 – $472,500
Commission – 5%
Net – $449,000
Loss – $16,000~
(Note that I’m ignoring the closing costs at purchase time, property taxes, interest paid on the mortage, inflation, opportunity cost, improvements, and insurance).
jb
James Bednar Says:
April 24th, 2007 at 1:25 pm
(Note that I’m ignoring the closing costs at purchase time, property taxes, interest paid on the mortage, inflation, opportunity cost, improvements, and insurance). jb
grim: that’s good…..I’m doing my best to ignore you
ChiFi (from a Yankee fan)
The Yankees pitchers are riddled with injuries. Not surprising since they’re all getting up there in age. I wouldn’t be surprised if they put Guidry in for an inning.
The Yanks have been on top since 1995 – I know most Yankee fans expect to be on top forever… I don’t. I remember the long drought in the 80s/early 90s when the team sadly resembled this one – overpaid, aging players. A-Rod is having a monster year, but it won’t be enough to overcome the mediocre pitching and then he’ll say “F-YOU” to the fans and bolt to another team next year. Then Yankee fans will be sorry they booed a two-time MVP… who are they going to replace him with?
Love my Yanks, but I don’t have high hopes. They could pull through… they have the past couple of years when no one thought they would… but I think the glory days are gone for now.
:(
I’m not a Mets fan, but they have a great team. That Reyes is incredible.
David over at Bubblemeter takes a stab at Lereah’s weather theory:
http://bubblemeter.blogspot.com/2007/04/march-existing-home-sales-down-realtors.html
Kim [103],
Keep the high hopes going. We haven’t even turned on the barbeque grills. It only counts when the leaves are falling. There are probably 2-3 players, not on today’s roster, that will have a huge impact this season. It’s a marathon, not a sprint.
“There are probably 2-3 players, not on today’s roster, that will have a huge impact this season.”
Do you think one of them will be Clemens???
Kim [106],
Probably. Although, I hope not.
I’m sure he is salivating, watching the starting pitchers drop like flies. Watch for Dontrelle Willis.
Chifi,
I am in Harrison Court. I think they still have a unit or two for sale in there. Nice enough place.
this guy lereah is on bloomberg, what an
a hole . sounds a little desperate says condo market has recovered.
and of course its all about subprime.
hobokenite #69,
we see the same trend in downtown jersey city right now… properties are selling again since about february, and prices are are not dropping.
at the same time, the neighborhood is getting nicer and nicer, you see a lot more people with babies and kids. things are definitely improving here, and you begin to hear better things about the public schools.
does anybody have data on how much steeper price inclines were in downtown jersey city compared to other cities in northern new jersey? what part of this increase is due to the overall bubble, and how is much is due to the local improvement and a general “urban” trend?
SV (91)
You called it right….looks like we will see a dip in oil prices to boost sagging spirits / consumer confidence:
Reuters: Oil falls more than $1 on profit-taking
NEW YORK (Reuters) – Oil fell more than $1 to $67 on Tuesday on profit taking after concerns about Nigerian supplies following elections sent prices higher.
London Brent crude, currently seen as more representative of global oil prices than U.S. crude, fell $1.27 to $66.88 at 1640 GMT, after jumping $1.66 on Monday. U.S. crude gave up $1.69 to $64.20.
“We’re seeing retracement of strong gains yesterday,” said Antoine Halff, head of energy research at Fimat USA.
More at: http://www.reuters.com/article/hotStocksNews/idUSSYD10372420070424
BC Bob – Willis! I would LOVE to see that!
You’re right, way too early for me to get pessimistic. I’ll keep my hopes up!
Now on to a real estate discussion…
As I mentioned in another thread, my husband and I are saving our pennies to hopefully buy a POS cape in the town we want to live in, since we love the school and town and our son is happily settled here. There’s this very cute 2-bedroom, 1-bath cape cod for sale down the road from me. It hasn’t been updated since it was built in 1952, but it’s in very good, clean condition so I could live with it for a few years. The upstairs has a floor but no heat, but you can put two bedrooms and a bath up there. The basement is a good size and has just been resealed so flooding should not be an issue. It has no deck or patio but a very nice sunroom and a nice yard. Taxes are low (around $4K). Asking price – $450K. We told the realtor we’d offer $350K but she said they won’t take anything under $400K, even though it’s been on sale for a year. So I talked to this other realtor guy who I liked much better and he’s pushing a cape cod on us that’s around the block from the other one, listed at $459K but due for a price reduction. It’s nicer than the other one, more rooms and updated, but it’s been sitting for a while because there’s an excavator company in the backyard, so that’s your view. I said, no thanks. So I mentioned the other house we liked, since it was from a different realtor, and he said that $350K was too low. I said, well, I know of this house that sold for $396K and this other house that sold for $390K in the same town (I was able to give him exact addresses) and I said they had more bedrooms and bathrooms, so realistically the $350K was not a stupid offer. He didn’t have much to say about that.
After reading the articles today about prices and sales dropping, there is NO WAY we should buy this cape for anything more than $350K, and even that is too much… it is worth about $275K. I will continue to wait!
I have that feeling that David “Liar” is going to say the same thing for the April numbers, considering that it rained so much.
“…chief economist at the Realtors, attributed the big drop in part to bad weather in February, which discouraged shoppers and meant that sales that closed in March would be lower. Existing home sales are counted when the sales are closed.”
I have a question for you guys! You might remember I was looking to buy in Maplewood. Well, we decided to leave NY all together, and I just accepted a job down in south Florida.
Will likely rent until we decide what to buy, but wanted your sense on prices down there. I saw a place I liked in Ft Lauderdale (2bed/2bath, 1950’s home) listed for $349K. The owners bought it in Nov. 2003 for $325K. Other than a new roof, new central air and an interior paint job (which I would paint over, as I want my own colors), no major renovations seemed to have taken place.
Question for you guys: what’s it REALLY worth??? I’m saying $270-$280K.
hi kim,
What town?
re: 53
And Bush has even MORE confidence in ‘Berto after his testimony before the Senate Judiciary Committee….
JerseyCitySidelines – #115
The only town I can think of with taxes that low is the Parsippany area.
“You called it right….looks like we will see a dip in oil prices to boost sagging spirits / consumer confidence:”
hoodafa [111],
PPT or position squaring ahead of tomorrow’s API/EIA reports?
#115 – I’m looking in Hanover Township (Whippany/Cedar Knolls).
I love to read the entries on this site – especially the statements where people actively hope for the complete collapse of the housing market and call homebuyers idiots. These entries are nothing more than a mask for the feeling of utter failure that renters experience b/c they do not have the talent or discipline to work hard enough to afford their own home. Instead of posting entries all day why not work and make some money so that you can achieve the american dream and own your own house?
skep-tic Says:
April 24th, 2007 at 11:19 am
credit tightening has not even shown up yet in the numbers and already we’ve got the biggest drop in sales in nearly 20 yrs
now that you need minimum 5% down, the vast majority of 1st time buyers are eliminated. Spring selling season = DOA
*******************************************
Not sure what you’re talking about….was recently approved for 100% financing. Don’t want to get in a big debate about it, but it’s still a go for prime borrowers.
Anyone have a link to Chameleon Lereah’s comments on Bloomberg?
castleking,
I own my house and I’m the biggest f*cking cheerleader for an epic blowup.
Tell this guy the party is over….
http://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=2371838&sid=086D7BE06939C&snumxlid=1075585438&lnksrc=00003
castleking – #120
troll, troll, troll your boat
off topic question –
is there a way to find out where a street with new construction is? what i mean is, since the street doesn’t exist yet, but the public record gives an address when deals close of 123 main street. how do you figure out where 123 main street is? is it just a suck it up and wait until the maps are updated? or is there another way?
and no, im not looking at buying new construction.
thanks!
castleking:
How’s this you punk chowderhead?
3BRs in Rumson, the beach is less than 5 minutes away in Sea Bright. On a cul-de-sac. This area is REALLY nice. $2800 negotiable
http://www.gardenstateapartments.com/search/view_listing/NJAP323
I bought my house at, or near the peak in Oct 2005 as a place to raise my family and not as an investment. I put 33% down and I can easily afford the house. I don’t care if the price goes down. As I grill my steak on my weber grill and look out over my big lawn I pity the renter.
“A well-regarded lending wholesaler that rode a boom in subprime home mortgages has abruptly closed following a market reversal, leaving 300 people in this Seattle suburb out of work.”
“In the past two years Mila trimmed its work force and tried to move into the less risky prime and Alt-A mortgage market.”
http://seattlepi.nwsource.com/local/6420AP_WA_Mortgage_Wholesaler.html
>>After reading the articles today about prices and sales dropping, there is NO WAY we should buy this cape for anything more than $350K, and even that is too much… it is worth about $275K. I will continue to wait!
good luck. check back in a couple of years while you continue to wait.
HEHEHE Says:
April 24th, 2007 at 2:06 pm
Chifi, I am in Harrison Court. I think they still have a unit or two for sale in there.
HEHEHE: voting Campos, eh?
Have you been to the Little Grocery…does it live up to the hype?
#128
congrats for winning the stupidity contest. You’ve already lost about half your downpayment in less than 2 yrs
Chicago finance:
What happens when the owner decides they want you out – you are forced to pack up and leave like a little beatch.
is there a way to find out where a street with new construction is?
Yes, get the block and lot numbers and either go down to city hall to find it on the map, or use a search that’ll give you back a tax map.
If you have issues just let me know and I’ll get you the location.
jb
#134 – thanks jb! it’s really just me being nosy, but ill see what i can find and let you know if i have any issues.
castleking you’ve walked into the lion’s den. you’re not part of the collective so you’ll be abused, ridiculed and scorned. enjoy!
renting will always be cheaper than buying. there’s a multitude of reasons why that’s the case. ponder it folks…
castleking is somebody making funny comments and f’ing with us. Don’t take it seriously.
Am I wrong here? The trolls have resurfaced in the last few days. Reech is in top form. Even clot doesn’t seem so jazzed that the Yankees have recalled his namesake.
Methinks many in real estate are in need of changing their Depends.
clot…..godspeed, although my guess is that you view these developments as, at worst, an inconvenience, and more likely, AN OPPORTUNITY!
skep-tic
I flat out love the house I bought and plan on staying for the next 20 years. The sense of joy that I feel when I roll up my driveway after work and see my kids playing on my lawn is immense. Plus the $22k tax refund check that I just received from the gov isn’y bad either.
ChiFi #127, that’s a good apartment website.
castleking Says:
April 24th, 2007 at 3:01 pm
Chicago finance:
What happens when the owner decides they want you out – you are forced to pack up and leave like a little beatch.
king: I pay a mover $1,000 to move me to the next place……which constitutes less than one month’s cash flow savings, and DOES NOT INCLUDE my hurdle rate return on my down payment. It’s the carry that completely kills your argument.
I’ll be amazed if Pissed Chris gets 20% of the vote.
I’ve gotten coffee at that Little Grocery a couple times. It’s nice enough, carries higher end stuff and the guy is a decent cook from what I’ve seen. You have to keep in mind there isn’t any place worth a sh*t back there to eat unless you consider Biggies Clam Bar fine dining.
I don’t mind a spirited argument, but the insult just isn’t necessary. Can we curb it?
jb
castleking,
good thing you like living there so much, because it’ll be a while before you’re above water on your mortgage.
incidentally, how much did your prop taxes go up this year?
Richard Says:
April 24th, 2007 at 3:05 pm
ignoring Reech will always be smarter than responding to his posts. there’s a multitude of reasons why that’s the case. ponder it folks…
CastleKing,
“…you’ll be abused, ridiculed and scorned.”
Only if you’re obnoxious in your opinions… or you flip-flop on your convictions.
Otherwise if you have constructive points to make I think you’ll find most here very open to what you have to say.
Hell, look at Clot and ChFi!
Rich
“I bought my house at, or near the peak in Oct 2005 as a place to raise my family and not as an investment. I put 33% down and I can easily afford the house. I don’t care if the price goes down. As I grill my steak on my weber grill and look out over my big lawn I pity the renter.”
Why couldn’t you rent a house, and grill there?
Yesterday I was comparing the same house for rent which was also for sale. It would take 23 years to break even. Not a penny of “equity” for 23 years when buying at bubble prices:
http://graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
I pity anyone who dumped 33% down at a 100-year-peak. Sounds like that money could have worked for you over the next 23 years.
Enjoy the steak!
castleking Says:
April 24th, 2007 at 3:07 pm
skep-tic
I flat out love the house I bought and plan on staying for the next 20 years. The sense of joy that I feel when I roll up my driveway after work and see my kids playing on my lawn is immense. Plus the $22k tax refund check that I just received from the gov isn’y bad either.
castle: you give yourself away…….
“As I grill my steak on my weber grill and look out over my big lawn I pity the renter.”
king[128],
You were walking in, I was walking out. I grill my own steak and sit by the pool. The pool which is maintained by my lanlord. For the last 20 years I did not give a damn about a big lawn, just a big target for dog doo and a ton of maintenance.
By the way, the interest that I make from my sale, maybe to you, pays both my rent and my steak. I can easily afford also. However, decided to walk away from the upcoming bust, will pick up filet mignon at chopped meat prices down the road.
Work/make money? Some are too busy working, trying to make a living, they never take the time to figure out how to make $.
chicagofinance –
I am sure that you are very intelligent but I am willing to bet that you are not married with children. Sitting down for Sunday dinner in your (not someone elses) dining and creating memories that your family will continue to biuld upon is, in my view, valuable. Who wants to uproot their kids from school b/c their father is too cheap to buy his own home and instead lives like a serf at the hands of his master?
Don’t feed the trolls.
I put 33% down and I can easily afford the house. I don’t care if the price goes down. As I grill my steak on my weber grill and look out over my big lawn I pity the renter.
I also have a nice Weber grill and some steaks in the refrigerator waiting for me when I get home. The only difference between you and me is that I grill my steaks in a rented yard.
Of course, while grilling my steaks, I can’t help but be thankful that I rent. My monthly payment is lower than yours and my bank account continues to grow, your big down payment gets eroded by the day.
Is it really worth losing that much of your money just to call yourself a homeowner and be able to hurl insults at renters?
castleking,
you are no less a serf than anyone. You are one mortgage payment or tax bill away from being evicted yourself. Hopefully for your sake you don’t actually believe the bank or tax collector will be moved by your teary-eyed stories of grilling steaks and soccer on the lawn
BC Bob –
Thanks for the post. Does BC stand for sfety school Boston College? You are obviously much more intelligent than me. Please explain what is wrong with taking out a 15 year mortgage at historically low rates and taking a tax credit for interset and taxes and living the rest of my life mortgage/rent free?
skep-tic –
Don’t get me wrong I am also looking for home prices to fall in Monmouth/Ocean county so that I can purchase my second home w/ 20% down, take out a 15 year mortgage and then pass down both my primary residence and a special shore house to my children. please exllain what is wrong with that?
Maybe with all the money you are saving you can buy some typing lessons?
OT:
I was looking at some exchange rates today. In the past month, the US$ has lost 2.1% against the Euro, 1.9% against the Pound Sterling, 2.6% against the Australian Dollar and check this 5.6% against the Indian Rupee. And the Chinese Yuan is pegged…to 1 Scotch.
I wonder if this devaluation (coupled with the housing construction decline under way) will make it less enticing for illegals to hop into the US in a few years from now, since what they send back home in their local currency will be worth less.
Where did you find this site castleking, and if you’re SO happy, why are you bothering?
And since you’re obviously a newbie, and probably a pal of Reechard, ChiFi is married with an adorable baby, and is a rather successful individual.
I’m not sure where you get the idea that all renters are poor losers…hubby and I rent, make great 6 figure salaries and plan to buy a house…when the price is right and we find something we like. Maybe we find something tomorrow, maybe in 6 months. But we feel pretty damn good about not buying at the peak, even though we’re not investors.
(Oh, and for an update – we did pull our offer on that house, and have another offer in on another, but we’re not stressing it and will just play the wait and see now)
We will probably see more of this silliness as time goes on.
As more and more bad news coems out, more people will start csreaming about how all is fine, and if people like us would just stop with the silly blogs, and if the media would stop with the doom and gloom, than all would be well.
castle king is some type of troll, the phantom 33% down, he/she did nto buy as an investment. The rude insults that renters are cheap or unsuccessful, the jabs that we are not doing right by our kids (although some on this site myself included, are renting very nice houses townhouses).
They want to believe that we are all in hovels in bad neighborhoods, it pains many that we are actually saving, not to mention our discipline in saying no, when we could have said yes.
It has been no big deal to get a mortgage these last few years (up until the last ciuple of months) Where is the sense of accomplishment in that?
All of this is done to denigrate us, becasue the last thing the rah-rah uber bulls want to admit is that perhaps we are right.
Each time a Bear throws in the towel and buys, it delays the correction a little longer;this is what these people want.
“Don’t get me wrong I am also looking for home prices to fall in Monmouth/Ocean county so that I can purchase my second home w/ 20% down, take out a 15 year mortgage and then pass down both my primary residence and a special shore house to my children.”
Wow, raising some spoiled and entitled brats – can’t see anything wrong with that.
I have a cousin with a shore house she’s waiting to inherit, and a multi-million dollar trust fund, and I’ve never met a more unappreciative spoiled person in my life. It’s what happens when you grow up with expectations.
castleking– now you’re using your head. just watch the flood zones
castleking Says:
…
Don’t get me wrong I am also looking for home prices to fall in Monmouth/Ocean county so that I can purchase my second home
This statement is a bit confusing. Are you trying to say then when a renter waits for prices to fall, it’s a sign of their own stupidity, but when you wait for prices to fall, it’s a sign of your own intelligence?
“Does BC stand for sfety school Boston College?”
castle [155],
No. Before Crash.
Nothing wrong about your scenario, dp and 15 year. As long as you don’t mind a crew cut.
It’s the argument I make all the time, why haven’t the masses taken advantage of historically low rates and locked them in. It’s simple, they required teaser rates/creative financing to get into the game. What now? You are not the problem, it’s the rest of the population, i/o’s, arm’s, zero down, piggyback, etc…. The consequences of their senseless actions will indeed be ominous.
Please understand that I am not attempting to denigrate and/or ridicule any renter. i am simply responding to the multiple posts that call home buyers “idiots” Reading these posts is akin to watching people cheer the sinking of the titantic simply b/c they couldn’t afford a ticket.
Did I over pay for my house – of course I did. did I get more money than i deserved for the starter house that sold when I traded up in Oct 2005 – heck yes. My only point is I bought a house at the peak of the market and I couldn’t be happier. I simply love the place and hope to hand it down to my children some day.
“i am simply responding to the multiple posts that call home buyers “idiots””
That’s why you need to watch what you say – the only person that calls them idiots is Booyaa, the local housing crash guru. If you read more posts instead of reacting to a perceived insult, you would understand.
castleking Says:
April 24th, 2007 at 2:56 pm
As I grill my steak on my weber grill and look out over my big lawn I pity the renter.
cadaverking: with the extra money I save and extra time I don’t waste on maintaining acreage, I go here ……http://tinyurl.com/ynrj6w
NJGal: thanks for covering my back…
Renters used to be wannabes, home buyers are now idiots? Quite amusing. I’m out of the closet, I go both ways. I guess I’m a wanniot.
Anytime ChiFi…I just can’t stand the mentality that so many people have that carrying a mortgage somehow makes them superior to those that don’t. It’s not something I will ever understand.
When we buy, I’ll remain ever jealous of the carefree young life I left behind, where I have no real maintenance responsibility and my money goes to me and what I want to do, not lawncare, broken boilers and leaky roofs.
ok, enough about castleking!!!
I have a question for you guys! You might remember I was looking to buy in Maplewood. Well, we decided to leave NY all together, and I just accepted a job down in south Florida.
Will likely rent until we decide what to buy, but wanted your sense on prices down there. I saw a place I liked in Ft Lauderdale (2bed/2bath, 1950’s home) listed for $349K. The owners bought it in Nov. 2003 for $325K. Other than a new roof, new central air and an interior paint job (which I would paint over, as I want my own colors), no major renovations seemed to have taken place.
Question for you guys: what’s it REALLY worth??? I’m saying $270-$280K.
Who wants to uproot their kids from school b/c their father is too cheap to buy his own home and instead lives like a serf at the hands of his master?
How old are your kids. My kid is young enough where we don’t have to worry about schools or friends for a while. I feel bad for people who felt compelled to buy at ridiculous prices because they didn’t want to uproot their kids or wanted to get them in a decent school system.
I would never buy, however, just so that I can make believe that I am the king of a castle. Would it really be so terrible to wait a few years to fulfill your king fantasy? Is overpaying really necessary to be the king?
Really, what is the difference between you and a renter? I rent from a landlord. You rent money from a bank. You only truly own about 15% – 20% of your castle. The real winner is the person who sold you the house at the very top of the market.
“Did I over pay for my house – of course I did. did I get more money than i deserved for the starter house that sold when I traded up in Oct 2005”
well, then your scenario is a bit different than many people here who are contemplating buying for the first time. you traded one inflated asset for another (and probably some additional debt), so you are not nearly as bad off as someone who had actually saved that 33% downpayment
and in case you’re wondering, many people here were too young to have bought a starter home before all of this madness started.
NJGal –
I am not going to apologize for working 70-80 hr weeks to create a good life for my family. to me, nothing is more important than family. there will be no trust funds. there will be, however, I shore house and primary residence to serve as the gathering place for our family and will hopefully enable us create great memories and pass down a special place for future generations of my family. That is how you create lasting wealth.
There are a FEW here that resort to name calling, but many here do not.
If you were just starting out with only savings (no equity in a starter home) I’m sure you too would balk at the run up in prices.
I can afford to purchase but choose to do so judiciously. I plan on staying in my home (non-starter and barring any unforeseen issues) for at least 10-15 years. I also know that if I do buy and have to sell before my plan I lose. I’ll lose big.
At least you seem to agree that prices were very high in 2005. I don’t know when you purchased your first home, but if you were starting out in 2005 buying your first “starter” home, would you not balk at the prices?
Rich
I’m gonna puke
castleking,
Has the new owner of #35 started work on the property? The place has some character, I’d hope they remodel, but I’m guessing a teardown is more likely.
I knew someone who was interested in that property late last year. Interesting that it went for $451k (original asking price was $518k), but not off-the-mark given it’s condition.
jb
Hey Lina —
I’m looking in MW/SO right now. In fact, just got overbid on a house today….three offers. And I thought it was a buyer’s market.
“I am not going to apologize for working 70-80 hr weeks to create a good life for my family. to me, nothing is more important than family. there will be no trust funds. there will be, however, I shore house and primary residence to serve as the gathering place for our family and will hopefully enable us create great memories and pass down a special place for future generations of my family. That is how you create lasting wealth.”
Hmm, but don’t you think that working 70-80 hour weeks detracts from providing a good life for your family? I’m an attorney, as is my husband, and we work long hours, but nothing like that. My dad worked his a– off as a law partner for years, and stated his regret for doing so ever since. Sure, we had country club memberships, a big house (and almost a Hamptons house, which Mom just didn’t want to deal with taking care of), fancy cars, vacations, private school, private colleges – but he has said numerous time that HE wishes he’d done it differently because he would have rather had the time to come home earlier and hang out with us, or not have to come down to the family shore house only the weekend because of work. The idea that you can’t create great memories without such a shore house is kind of sad. Great memories come from family being together, setting aside. Building wealth should be a part of life, not your whole life.
Lina,
I don’t think anyone is ignoring you.
South Florida is a large area and the odds of finding anyone here knows the Florida market is pretty slim.
Maybe if you gave the name of the city or county at least… but I doubt anyone at this Jersey centric “posting location” will know.
Rich
rentingnj –
In 14 years my mortgage will be paid off. I will own my castle. You will be renting for the rest of your life. I have 4 kids age 1 to 8. school is very important to me. My view is although my taxes are high I am getting my money’s worth.
By the way, I think many people think like castleking – like they make their kids lives better by money (and we’ve had the discussion about how crappy and entitled some kids are lately because of it). So it’s not just him that I’m criticizing here, but to me it seems like an infection that’s caught the whole country, and specifically the tri-state area.
Fort Lauderdale, Wilton Manors (33305) to be exact.
CastleKing,
I didn’t put your name up so I’m guessing you missed this:
There are a FEW here that resort to name calling, but many here do not.
If you were just starting out with only savings (no equity in a starter home) I’m sure you too would balk at the run up in prices.
I can afford to purchase but choose to do so judiciously. I plan on staying in my home (non-starter and barring any unforeseen issues) for at least 10-15 years. I also know that if I do buy and have to sell before my plan I lose. I’ll lose big.
At least you seem to agree that prices were very high in 2005. I don’t know when you purchased your first home, but if you were starting out in 2005 buying your first “starter” home, would you not balk at the prices?
Rich
#165 castelking
I think most of the folks here ridicule the first time home buyer that is buying at a 100 year high and using toxic loans to do it. Starter homes are unaffordable because of those folks’ stupidity. Based on your description, you are not the type of person that is being made fun of on this site.
I too am attempting to do what you did – sell my first home and trade up. In real terms, a 10% drop in the house I want to buy is a lot more than a 10% drop in the one I’m trying to sell. I don’t see how I can’t root for prices to drop. Either way, I’ve found everyone that posts on this site to be very helpful in all things relating to NNJ real estate.
Regards,
Jersey4Life
i am simply responding to the multiple posts that call home buyers “idiots” Reading these posts is akin to watching people cheer the sinking of the titantic simply b/c they couldn’t afford a ticket.
You are insulting renters. Why do you assume renters “couldn’t afford a ticket”? Has it ever occurred to you that many of us simply chose not to board the Titanic because we can see the disaster coming? I could buy if I wanted to, but I chose to because I don’t think it’s a good time to buy.
MBaldwin –
Where are you looking, and where did you get outbid? It’s CRAZY that over bidding is still happening.
NJGal-
I am really sad to hear that you had a lousy relationship with your father. Is that the source of your venom?
I too am an attorney. I work crazy hours – especially when on trial – but I always spend sundays with my family even if it means working to 1 a.m. during the week.
I also work hard so that my wife does not have to work outside the home. If i thought for a second that my work had a negative impact on my children I would show the courage that your father failed to show and enter a new line of work. right now i am working and attempting to buy real eastate so that i can enjoy the fruits of my labor later.
“You are insulting renters. ”
I like it :)
NJGal,
Could not agree more re the kids. I remember growing up I’d get a birthday party every once in a blue moon with a couple neighborhood kids and classmates, maybe 7-8 max. Now these parents are inviting these kids whole school classes AND their parents. My brother keeps complaining about all the one upsmanship, professional clowns, inflatable trampolines and stuff, and always having to buy a gift on behalf of his kids for some kid he hardly knows.
NJGal [178],
Great post.
I come from a family of six kids, mom did not work. We doubled up in rooms. When I needed new clothes, my shopping entailed going into my older brothers closet. The weekly treat, pizza on Friday. We did not live in anything that resembled a castle. Better than that, we lived in a cozy home. The memories created, of such epic proportions, a castle would not be large enough to embrace.
real estate bubble believer = community member with legitimate viewpoints
non-bubble believer = troll to be ignored
your comments show your true stripes.
So Completely Off Topic – (for those who are interested:
No, I have no affiliation whatsoever:
The Valley Hospital will sponsor free Skin Cancer Screening Programs on Monday, May 7th in the Dorothy B. Kraft Center located at 15 Essex Road in Paramus and then on
Saturday, May 12th in the Robert&Audrey Luckow Pavilion at One Valley Health Plaza, off Winters Avenue in Paramus.
To register for an appointment, call (800) 825-5391. Appointments are limited, registration is required.
The screening includes a close physical examination by a board-certified dermatologist. Each participant will receive a profile sheet indicating if a significant lesion is present, a preliminary diagnosis, and a list of board certified dermatologist if further medical care is recommended.
sl
castleking: my rent = your property tax. We’re both renting. PS: My rent has been the same for 3 years. Did your property tax?
PS: I’m sitting on my downpayment which made 16% last year … and I can sell it tomorrow for $9. Hope that steak is delicious, it sure cost more than mine.
your comments show your true stripes.
Who?
Lina —
We’re looking all over Maplewood/South Orange. The sellers priced the house under market and generated multiple offers. Not sure what the winning contract offered, but we offered just a tad under asking and didn’t get it. (We were pushing the very upper limit of our budget and didn’t have anywhere to go.) That said, it was a lovely house in good condition in a nice neighborhood.
>>Please understand that I am not attempting to denigrate and/or ridicule any renter.
you won’t be treated in kind. sarcasm on. idiot owner. i don’t care if you bought in 2000 or 2001 and are up 80-100% on your purchase price, you’re still an idiot owner and will suffer once those damn prices come down to where i think they belong! there is absolutely no value at all whatsoever to owning versus renting, didn’t you get the memo? sarcasm off.
BTW why is anybody arguing with this troll? You know he’s full of bs
The first 4 minutes represents some freakish doppelganger, but the amnesia dissipates and the bs returns.
http://www.bloomberg.com/avp/avp.asxx?clip=mms://media2.bloomberg.com/cache/vtv_vPaaAqSc.asf
sl [192],
Thank you. I will certainly take advantage of this.
Where is your office? If you rather not post it, you can get my email address from JB.
stuck in moderation…..by the way…Bloomberg radio is great, but the TV studio people are utter morons…..just a bizarre dichotomy….
“I am really sad to hear that you had a lousy relationship with your father. Is that the source of your venom?”
Oh wait now. I have the best dad in the world – we have a great relationship, and I take no insults to Pops, who I can assure you is a better man than most, especially you. I said HE felt like he missed out – not me. My dad is great – loved by all, coached many of our sports teams, and charitable too, having won numerous awards for his involvement in our schools and town, which is why I never understood why he felt like he missed out – and I just won’t hear crap about him and our relationship from some tool like you who equates happiness with a shore house and listened to some Donald Trump seminar about how real estate creates wealth. God, now I know why I couldn’t stand the people in law school.
And thanks BC Bob and Hehe – it’s good to know there are some people out there who value family over money. Gives me hope.
Jersey4life and RentininNJ –
I have no quarrel with first time home buyers rooting for prices to drop. I only take exception to the numerous posts that call homebuyers “idiots” The simple point that i am trying to make is that other intangible factors in addition to pure numbers go into the home buying decision.
I also take exception to NJGal’s suggestion that my kids are somehow going to end up as drug addicted teens hanging out at 7/11.
#165 There you go again with the insults, could not afford a ticket, says who, you?
I/O no money down, neg aamoritization and all the rest, yet you attribute many people’s reluctance to buy, to not being able to afford a ticket. That is why the term idiot is used from time to time.
“BTW why is anybody arguing with this troll? You know he’s full of bs”
hehe,
Quite possibly the reincarnation of “make money”.
castleking Says:
April 24th, 2007 at 4:23 pm
cadaver: you don’t happen to be related to the Essex CC kid in the computer lab who skipped out paying his NYU tuition to buy an entire apartment building in Manhattan, and worked pushcarts in Times Square for extra money?
Just checking………..
Bost: we think alike…….scary :)
#94:
Interesting opinion quoted in the article:
“But Dean Baker, the co-director of the Center for Economic and Policy Research and a leading proponent of the theory that there has been a bubble in housing prices, says that he believes it could take five to seven years before prices get back to their highs on a nominal basis.
If prices are adjusted for inflation, he thinks that prices will never recover their recent highs.”
That last sentence is quite interesting. I wonder if things might actually turn out that way.
“I also take exception to NJGal’s suggestion that my kids are somehow going to end up as drug addicted teens hanging out at 7/11.”
I never said that, but then again, having grown up in a wealthy town and seeing from experience, it’s often the kids from the “best” homes whose parents give them everything materially who end up in rehab. We have a family friend whose kid is in rehab for coke and alcohol now – kid went to a private h.s. in the city, private college and comes from a VERY nice family.
My only comment has to do with the state of our world nowadays, and the idea that somehow creating wealth and buying things makes life so much better and one’s kids so much happier. I just don’t think it’s true. My dad’s family was poor as anything, and there were 14 of them, and they remain very close to this day, and have many happy memories (and a blast when they get together), even without the material goods.
the emotions run strong here because the bubble believers are in the extreme minority in both viewpoint and action. when in such a state it’s important to have a strong support system a.k.a. grim’s blog to maintain such a minority opinion. maybe y’all should listen to what castle is trying to say, he makes some valid points. but you won’t because that violates what i just said.
LOL, I think Castleking is trying to pick on the wrong group of renters.
Maybe I’m wrong, but I’ve noticed that the regulars here seem to be a bit more well-educated and affluent than the average renter or first-time buyer.
NJGal,
Is the offer in Westchester Co.? I ask because I work in White Plains.
NJGal-
Your argument makes no sense. On one side of your mouth (post 178) you state your father lived a life of regret b/c he “worked his a – off as a law partner for years” and then out of the other side of your mouth (post 200) you state that he had plenty of time to coach your sports teams and engage in charitable endeavors. Which was it? Was he the hard charging law partner who “worked his a-off for years” or is he Walter Matthau from the Bad News Bears trying to recruit you to be the pitcher for the team?
I simply take exception to you judging me or my life. I have made a decision that putting in extra hours to buy a home at inflated prices makes sense for my family right now. you may disagree but please don’t suggest that I am a lousy father or at the very least have the integrity to make a cogent and consistent argument.
Hey guys, I am trying to see where most people are closing their deals. I just purchased a house the listing was 420 and I purchased it for 400 and then the sellers pays closing costs at the closing. I am just wondering if on avg how much are houses going for these days. 10% below cost, 5%, etc.
Richard Says:
April 24th, 2007 at 4:31 pm
Reech: your thought process is clouded…..I have an innovative solution that will provide greater relief than your normal “mind cleansing” process…….
http://www.ineedcoffee.com/01/01/enema/
“Bost: we think alike…….scary :)”
Chi,
But “make money” had Knick season tickets. Now, that’s impressive. That said, I’d rather cut the king’s grass than be held hostage to Starbury 41 times a year.
“maybe y’all should listen to what castle is trying to say, he makes some valid points. but you won’t because that violates what i just said.”
You only think they’re valid because you agree.
No one here has ever denied that there is some psychological value to owning for many people (hence the lawn comments, etc). Or that if you own for the long term you will probably be fine. But castleking also makes some points that are just, well, shallow. And the idea that real estate is the only way to build wealth is silly. Plus, that is really only a mantra for people who INVEST in real estate, which castleking claims not to be. And even those people would acknowledge that buying at the top is not the best way to make money in real estate
Jersey4Life, yes, the offer is in Northern Westchester, Somers/Katonah area again (I argued for a place we saw in Pound Ridge, but alas, lost that argument because the commute would be from Connecticut and the house was “too small” for hubby)
castleking Says:
April 24th, 2007 at 4:38 pm
cadaver: you are not a lousy father, however, I think you may fail a class on finance and further competitive strategy
by the way……since we are being trolled by an ambulance chaser, please let me remind everyone that you should add a low cost umbrella policy for $1M in coverage to your exisitng P/C insurance
Richard,
“real estate bubble believer = community member with legitimate viewpoints
non-bubble believer = troll to be ignored
your comments show your true stripes.”
What IS your true stripe?
Richard Says:
June 25th, 2006 at 10:00 am
“next year we’ll have the same recipe but more of the same ingredients with 3.3x the ARM resets and rates probably at least 75-100bps higher than today. next year is going to be the start of a bloodbath IMO. if you can wait to buy i’d highly recommend waiting until the spring market and saving up for more downpayment to shield you more from the rising rates.”
It seems your the one that needs the “strong support system” in order to come to terms with your house purcahse and your 180 degree stance.
You bought a house, get over it.
Rich
NJGal: sorry, I feel compelled to mess with you………http://www.salingersorchard.com/pies2000.html
I forgot all about “make money”: the son of an immigrant, uses his NYU tuition money to buy an entire apartment building on fifth avenue, then sells it for a hefty profit and then continues to do the same over and over again until he becomes the immigrant equivalent of Donald Trump.
“Your argument makes no sense. On one side of your mouth (post 178) you state your father lived a life of regret b/c he “worked his a – off as a law partner for years” and then out of the other side of your mouth (post 200) you state that he had plenty of time to coach your sports teams and engage in charitable endeavors. Which was it? Was he the hard charging law partner who “worked his a-off for years” or is he Walter Matthau from the Bad News Bears trying to recruit you to be the pitcher for the team?
I simply take exception to you judging me or my life. I have made a decision that putting in extra hours to buy a home at inflated prices makes sense for my family right now. you may disagree but please don’t suggest that I am a lousy father or at the very least have the integrity to make a cogent and consistent argument.”
Actually he’s both, which makes him a great man, and there seem to be few of those these days. And I tried to explain the inconsistency when I say that I cannot understand why he thinks he missed out, because it’s clear from the life he has lived and his actions that he has NOT missed a thing, and that we never felt like he wasn’t there when he needed him. But he has since expressed his own personal feeling that working so hard was not a positive force in his life. And believe me – the way he worked was nothing the way people work today, so it’s even more difficult to understand why he feels that way. And if you can’t understand the dichotomy, well, not everyone is equally perceptive and understanding when it comes to the human mind.
And I never said you were a lousy father. I wouldn’t say that about someone I don’t know. I just expressed that perhaps living for material goods and money – which your posts lead me to believe are important to you – is not, in my experience, the way to go.
“NJGal: sorry, I feel compelled to mess with you…”
Ha, you’re so mean to taunt a pregnant lady with such delicacies. Speaking of, ever been to King Kone in Somers? It’s a roadside ice cream stand with some wicked greasy spoon food and outstanding soft serve. We made a pit stop there this weekend.
As a homeowner in northern Bergen county, I had a lousy week – still waiting for carpet guys to come and change. contractors to work on my basement wall, at least plumbers took care of my water heater and sump pump, etc.
Now, I remember why I was never fond of lawyers. ;)
There’s nothing wrong w/what Mr. Castleking is doing (enjoying his home), since he plans to stay there until it’s payed off and beyond. But if he were planning on moving in the next 5-10 years, he might have a problem.
NJGal –
If material goods and money are not important, why are you going to return to work after you have your baby?
BC Bob,
I saw my buddy Michael N from the Rangers the other night. I told him to take more shots and don’t pass to Jagr too much. :)
Larry G Says:
April 24th, 2007 at 4:39 pm
Hey guys, I am trying to see where most people are closing their deals. I just purchased a house the listing was 420 and I purchased it for 400 and then the sellers pays closing costs at the closing. I am just wondering if on avg how much are houses going for these days. 10% below cost, 5%, etc.
******************************
Didn’t get the house, but offered full price on a house listed for $510 this week with $5k sellers contribution to closing. Was told they weren’t considering any contributions to closing and had an offer with a better number. Go figure.
I received a reply from The Record in regard to my post at #2 above, Buyers will like spring selling season.
I cut & pasted the response so as not to interpret reply:
“thanks… pretty interesting!”
Well, at least they acknowledged receiving my email…
Rich
NJGal –
Your posts are encouraging. I am attempting to walk the same tightrope that your father did – work my a- off as a law partner and be there when my kids need me. What is wrong with that? And rather than renting a home at the shore every year why not try to create a special home that my family can enjoy for generations to come?
#208 Richard Oh and how many times has the minority view point on so many things been right? Too many to count.
Then of course you get the chorus of well we knew it all along, and how could any one think differently.
Face it Richard you try to maintain a so called balanced vire on this real estate debate.
But you will only be happy if we come around to your point of view, and buy a house; now.
CastleKing has a valid point or two. He just needs to work on delievery and something called manners.
“If material goods and money are not important, why are you going to return to work after you have your baby?”
Because I like working, and adult company, and I spent many years getting my degree for a reason. All women are not meant to be stay at home moms (frankly, I’d go nuts). So I guess it’s ok for you to judge me, but not for me to judge you?
And I never said those things are not important – find me a person who doesn’t need a roof over their head, food to eat or clothes to wear. So I work to live. I just don’t live to work. Money is not all encompassing to my life, but it doesn’t mean I don’t need it. I’d just rather spend some time with my family than work an extra 50 hours a week so my kids can say their parents own a shore house versus renting one for the summer.
“I told him to take more shots and don’t pass to Jagr too much. :)”
David,
……………and we still lost 2 [frozen four] finals in a row. You sure your kid does not want to go to Chestnut Hill?
“And rather than renting a home at the shore every year why not try to create a special home that my family can enjoy for generations to come?”
Because it doesn’t matter to your kids. It really doesn’t. And if you want to balance that tightrope like my dad did, it may mean saying well, ok, we don’t need a house in the Hamptons, we’ll just rent something and I can use those 50 extra hours I’d need to work to come home and coach your Little League team.
My husband’s family rented a house on LI for years, every summer, and I have heard nothing but fond memories of it from them, even though it wasn’t theirs. Again, working to own a second house, when it means spending less time at home? Just not worth it if you have a family that can make memories no matter where they are.
And by the way, I just don’t think there’s a way to do what my dad did nowadays. He became a partner after 5 years at his firm, in the 1970s. So when we were old enough to really need him, he had more control over his life than any partner in any law firm that I know of (well, except in mine, but I’m in a very unique situation – small firm, all former big firm partners, all flush with family money so they don’t care).
#226 M Baldwin: You gave it a shot, those buyers may yet regret that they turned your offer down.
I am still amazed thought that there are peopel out there who appear to be oblivious to all that is going on. I guess its the last of the herd over the cliff.
I am a corp relo and will be working in N. Central NJ. We have no children and have found two spots Long Valley, and Nazareth, PA that we feel most suited to our taste.
I have two basic questions
1. Which location has “better” resale value in 3 years?
2. Is either location experiencing faster declines in price?
We have been on one house hunting trip and are getting the impression from our NJ realtor that inventory in the Long Valley area is limited in the $800K price range.
In fact she submitted MLS listing #2367639 to us and said, “This is a great listing. Will not last. New price to be $819K. Agent gave me the courtesy of knowing in advance. Timing is everything and they are ready to go . If you look at comps in neighborhood new price is VERY good .”
Common, it is a Toll Bro house. No way can it be that good. Is it???
In regards to Post 228 I received another email.
“are you a real estate agent, and could i talk to you for future articles?”
Is there an agent with NJMLS access willing to share true data for articles in The Record, yet doesn’t fear repercussions from their brokerage for their actions?
NJGal,
Why are you arguing with this guy? He is not a lawyer. He probably doesn’t even own a home or have a family. He’s purposefully trying to drive you nuts and you are letting him, relax.
He probably doesn’t even own a home or have a family. He’s purposefully trying to drive you nuts and you are letting him, relax.
He is who he says he is and the information provided thus far is accurate.
jb
“Why are you arguing with this guy? He is not a lawyer. He probably doesn’t even own a home or have a family. He’s purposefully trying to drive you nuts and you are letting him, relax.”
Ha! Of course he’s a lawyer – he’s completely irritating. I can smell one from a mile away. It’s just a talent I have from law school and working around lawyers these past few years:)
By the way Hehe – you live in Harrison Ct.? How awful was your flooding? Could you even leave your building?
He is who he says he is and the details he provided are accurate as far as I could dig.
You frighten me.
:p
castle,
The madness created, in this market, by reckless behavior was not attributed to move up buyers. This blog goes to great length discussing the absurdity, asinine, irrational behavoir of greedy buyers [flippers]. In addition to this, those that put zero down and finance with exotic mortgages and the inconceivable actions of lenders [no standards]. That’s the crux of the problem.
Nobody is ridiculing the move up buyer. The market cooperated and you moved up. Congrats. What do you say to the first time home buyer that does not have the luxury of rolling over their position into the next forward month/period?
Just saying goodnight all. Off to take care of my sick little puppy – he’s my baby practice:)
NJGal-
You and your family must be truly incredible. Not only was your father the last of the Mohicans (the last attorney who was somehow able to juggle a demanding law practice and be there to coach his kids), you also grew up in a wealthy town (post 207) and you were someone miraculously able to avoid being the “spoiled entitled brat” (post 161)that you accused me of raising.
I don’t work an extra 50 hours a week I just stay late on the weekdays and listen to John Serling and the Yankees as I work. My kids love going to the Shore. Why be limited to 2 weeks a year when i rent instead of owning and being able to spend all holidays there?
cadaver: you are my hero……BTW do you work with Chris Campos?
Flooding was ridiculous. People had to sandbag our lobby and I worked from home on Monday like 3/4’s of the people there, it was nuts, if the members of the city council aren’t voted out after that insanity then they never will be voted out.
Well regardless, if he is or isn’t who he says he is, the facts are the real estate market is going to continue its long downward slide. I hope he doesn’t end up having to sell in the next 3-4 yrs or he’ll be screwed.
BC Bob –
My advice to the 1st time buyer is to move out of the state of NJ. Good jobs are fleeing the state and the budget deficit is going to cause real problems.
I started practicing law in 1994, scraped together a $28k down payment and bought my first house in 1999 ($280k) and sold the house in 2005 ($480k)
If I started practicing law in 2004 instead of 1994 I would have moved out of the state by now.
Bob,
His summer hockey counselor plays for Princeton and his coach’s son plays for Yale. My kid wants (hopes) to play for Princeton or Yale.
I am off to Connecticut. This is AAA traveling hockey tryout week in Connecticut. Getting a bit tired of “quality” time with my son – almost 6 days a week – hockey and water polo.
I have to put time for “work” here and there. :)
Chicagoserf –
Who is Chris Campos?
From Reuters:
LandAmerica first-quarter earnings plunge
LandAmerica Financial Group Inc. (LFG.N: Quote, Profile , Research), one of the largest providers of title insurance in the United States, said on Tuesday earnings fell sharply in the first quarter, hurt by weakness in the residential real estate market.
The real estate insurer said earnings were $4.7 million or 26 cents a share, down from $13.7 million or 78 cents a share in the year earlier quarter.
“just stay late on the weekdays and listen to John Serling and the Yankees as I work”
castle,
I have not heard much of; “The Yankees Win, The Yankees WIIIIIINNNNN”.
“Did I over pay for my house – of course I did. did I get more money than i deserved for the starter house that sold when I traded up in Oct 2005 – heck yes. My only point is I bought a house at the peak of the market and I couldn’t be happier.”
So you didn’t buy in 2005 as a first-time buyer… Another smug equity locust confusing simple luck with financial acumen.
Would you have entered the housing market in 2005, as a first-time buyer, without the benefit of “more money than you deserve from the starter house”?
No lack of excitement tomorrow..
Durable Goods due out at 8:30am
New Home Sales due out at 10:00am
jb
I have a question for Richard:
Do you read the articles/links posted here? Are you considering the data at all?
How can you ignore the hard cold facts?
I am not saying the sky is falling but don’t you see what is occuring in the local and national housing market?
castle [248],
If you hang around this site, you will discover the same being addressed here. The prudent, on this site, are first time home buyers that don’t want to pay 10 x’s their income for a house/condo
and be saddled with debt which they can not reasonably afford.
I first bought in 1985. Subsequently sold in 2005. I never imagined that I would be renting at this point. However, irrational, speculative, moronic behavior convinced me to move aside. I will be back, albeit at much lower levels. The market giveth and the market taketh. We are in the first phase of the taketh stage. You are fortunate, you put down a large dp and will not be affected by this upcoming earth shattering event. Sorry, the same can not be said of the majority that decided to “purchase” a free call option in 2004-present.
Stuck in moderation…
To distill it down, we have a lawyer earning $200/hour attempting to belittle others for not buying at a 100-year market peak.
What lesson would the kids learn from that maneuver?
Not in the same league as “make money”. “make money” never wanted to work for money.
Btw, “make money” said he will be back in June, with good news about real estate. Waiting for him to be back.. its always good fun. Around this time every month, people listen to news, get worried, google bubble and land up here..
I appreciate all enterprising people. I respect all people who work hard, take risk and achieve something in life. One minor detail about “make money” which I couldn’t ignore though was the loan that he took from his father, and invested in real estate was meant to pay off something else. I wouldn’t like it if my kids do that.
Unreal: good catch……at worst a troll, if genuine, then simply myopic and full of hubris…
Unreal –
I am not attempting to belittle anyone. once again I am simply responding to posts that characterize me as an idiot for buying a home.
I realize that you are brilliant. But, maybe, just maybe there is not going to be a 20%-30% correction and maybe the market will just tread water or did a little. Either way – once again there are additional intangible factors that go int the home buying decision other than simle numbers.
Grim (26)-
Yuck.
“You and your family must be truly incredible. Not only was your father the last of the Mohicans (the last attorney who was somehow able to juggle a demanding law practice and be there to coach his kids), you also grew up in a wealthy town (post 207) and you were someone miraculously able to avoid being the “spoiled entitled brat” (post 161)that you accused me of raising.
I don’t work an extra 50 hours a week I just stay late on the weekdays and listen to John Serling and the Yankees as I work. My kids love going to the Shore. Why be limited to 2 weeks a year when i rent instead of owning and being able to spend all holidays there?”
More insults huh? Actually, I do think my dad is among the last of a dying breed, and if you were being honest with yourself you’d realize that – the tail end of the “3 martini lunch” crowd who mangaged to be successful and have a life. Seeing that you graduated from law school in 1994, guys like my dad are probably your boss, and many of them are starting to retire or think about it (Dad’s not even a partner anymore – he’s taken a comfy senior counsel job at a BigLaw place, his first step to retirement). I think the ability to live that life has gone by the wayside because of people’s more modern “needs” (like shore houses), although many like to pretend it hasn’t.
And actually, I did manage to come out unscathed, and I consider myself lucky. I’m among the minority I think, and a lot has to do with my husband, who’s father, although a doctor, is a practical down to earth sort who grew up in the Bronx and kept and passed down those humble ways. But I know my way around Neimans and in my youth paid the (credit card) price for it, and learned it doesn’t make you happy. In honesty, I can’t say my sister did – she’s much more entitled and bratty and at 28 still helps herself to Daddy’s dime. Even Dad’s admitted his mistake there, and everything he did was with the best of intentions, which you seem to be doing. She’s not alone either – my town is one of the one’s people complain around here about – at least 3 of my neighbors around my age got houses from mom and dad, and not POS starter capes either. Can’t speak of it unless you’ve lived it, and I have, and I see what happens. You don’t have to believe me, or listen to me and maybe your kids will come out just fine. I’m just saying that in my experience too much too soon is not necessarily the best for kids.
And I think, from all this, you are getting the shore house for yourself. And that’s fine, if it makes you feel more successful or it’s something you want. But I just wouldn’t tell yourself it’s for your kids, because kids, unless ruined by life, do not think the same way their parents do about owning/renting. As I said, I have an aunt with a shore house, and it’s a lot more work than you think, and although our whole family has had the use of it over the years, we would have been fine renting a place as long as we were together. But if you think it’s a nice thing to have, by all means.
After the miserable existing sales numbers today, I thought I’d check what you guys are up to and my GOD you are still talking about me. LMAO.
Since RE investing has dried up and I DON’T have to work for a living I decided to take acting classes.
What do I know you guys are the lawyers and the smart people. I’m retired.
Enjoy saving money while paying “my” rent.
SL,
Thank you for the Skin Cancer link!!
Very much appreciated.
So, CastleKing, to which poor client will you bill all your internet posting hours?
And maybe you wouldn’t need to work all those hours if you spent less time trolling the internets and more time, you know, working.
Just saying.
chifi (139)-
This is a big-time opportunity! I’ve been waiting for this for years. Clean out all the part-timers, bored housewives and genetic mistakes from our business…now is all about sellers who have to sell and buyers who have to buy.
Let all the morons make $9 an hour at Barnes & Noble.
Castleking,
I really don’t understand what is wrong with you! There really aren’t that many posts or bloggers who call people who own real estate idiots! Is it that you like saying you own a million dollar house & if the market goes down you won’t?
You’re in a great position right now – you sold your starter, have a great locked in 15 year mortgage & can handle all of your costs. Apparently you even adequately juggle being a dad to four kids and a high stress job. Here is your pat on the back! *pat*pat*pat* You did what works best for you. Others will do what works best for them.
It’s irrelevant now to you (except for the beach house) if prices go down or not. It’s also irrelevant if people continue to rent for their own reasons. Don’t take it personally & certainly refrain from some of the nasty comments about mothers who want to work, father-daughter relationships & what-have-you. Again, irrelevant. It really looks like you’re trying to prove or convince yourself that you haven’t made any mistakes for your family. It’s OKAY.
#261 castle: Ah you let the cat out of the bag, with your correction comment.
You are worried, and your right, there will be a correction;a substanial one.
D –
Thanks for the post. First, I don’t have a million dollar house. I purposely stayed within a strict budget. Second, i have no position with respect to working mothers. If my wife wanted to work outside the home i would support her 100%. i posed the question to njgirl simply to expose her hypocrisy. Third, in reviewing posts on this cite for the first time I could sense people experiencing extreme joy at the thought of homebuyers losing their homes due to foreclosure. it just struck me as a waste of energy. I could understand the frustration of not being able to buy a home. Rather than make posts on a web cite hoping for the implosion of the housing market I would follow the jobs that are flowing out of the state and move to a more affordable part of the country. My posts about family were simply in response to njgal’s post that I was raising “spoiled entitled brats” I just didn’t care to be lectured by her and I wanted to expose her hypocrisy.
Castleking,
I think you misinterpret some of the joy. It’s not really directed so much at the homeowner as it is the finally being correct about the state of the market! Many bloggers saw what was happening in the market (prices not supported by earnings, etc) & now they are finally being proven correct. THAT is what is exciting. Where will it go next? What is going to happen? It’s all unchartered territory with the new mortgages & loose lending thrown in. It’s a puzzle that is only just coming together. That’s why I’m interested in reading. I’m not selling, buying, or renting (except from Wells Fargo), but it’s fascinating all the same.
Now, the flippers… those are the ones you’re likely to see called idiots. The greed gets to people who’ve been priced out these last 3-4 years.
Anyone have any information on the most recent wave of Fitch downgrades?
Fitch Downgrades 3 and Affirms 4 Classes of Putnam Structured Product CDO 2001-1, Ltd.
Fitch Affirms 97 & Downgrades 29 Classes From 18 CSFB Heat 2002-2004 Securitizations
Fitch Upgrades 16, Downgrades 3 & Affirms 10 RMBS Classes from 4 CFMSI Issues
Fitch Downgrades 4 RMBS Ratings from MASTR Second Lien Trust 2005-1
Fitch Affirms 57 & Downgrades 19 from 6 SASCO Closed-End Second Lien Transactions
Fitch Takes Various Rating Actions on 23 SAIL RMBS Transactions
Fitch Affirms 29 & Downgrades 25 from 11 SASCO ARC Transactions
Fitch Affirms 49, Upgrades 2 and Downgrades 3 from 15 SASCO Transactions
Fitch Takes Various Rating Actions on 2 Finance America Mtge Loan Trust Issues
Fitch SMARTView: 63 U.S. Prime and Alt-A RMBS Transactions Placed Under Analysis
Following its monthly surveillance review, Fitch identified 63 U.S. Prime and Alt-A transactions among its $529 billion rated universe of Prime and Alt-A transactions as ‘Under Analysis,’ indicating that Fitch will be issuing a rating action within 30 days.
#269, lawyer Castleking, there is a difference between a web cite and web site.
dreamtheaterr –
That is precisely why I have a smart secretary
More OT stuff – hopefully of some utility.
Take a few hours and track your family tree. If you have 3 generations of family members who have had a cancer (ovarian, colorectal, etc) — even if it was in their later years you may be at risk for a similar cancer and would require EARLIER screening than what the American Cancer Society suggests.
A lot of folks have heard of the BRCA1/2 gene that affects women and gives rise to ovarian and bre@st cancers much earlier in life: like in 20’s and 30’s.
A lesser known high risk gene can that predispose a person to these cancers, albeit later in life, is the root of familial colorectal polyposis.
Simple screening can save your life – colonoscopy at 40 (not the usual 50) and stool hemoccult (fecal blood testing.)
Yes… just some more educational stuff on the not-just-real-estate- njrereport!
sl
(for BC, and D,– again, no problem.)
Just attempting to stamp out disease and make the world a better place…even if it’s in a rental ;-)
Now the guy can bill several clients for “lexical research” and be technically correct.
*lol* SL, “even in a rental” TY!
Btw, Grim, do you know who we are?
(o)(o)
______
Your post about castleking being who he says he is is freaking me out.
I’ll have to call you my Big Brother JB.
Seems to me that castleking just doesn’t get it. He believes that people have been priced out forever, and should therefore move to another state.
Mr. Castle, please go do some research on median income to median home prices in the NYC market. I believe JB has some links around here somewhere. If not, you can probably have your clever secretary google it for you.
OK, who’s the commom denominator? I talk about the reincarnation of make money and miraculously he/she/it appears. Has Listen disembarked from Wayne Huigenza’s yacht? Not to be cockeyed, but has chart class also been suspended?
Castleking …….
Had a grand house, works 80 hours a week and manages come home and have great family time/dinner with his kids and also grill during lite time – so he can actually see the huge lawn. House will be paid off in 8 years, 4 great kids, Smart (blond and HOT I assume) secretary and wife do not work….
WHAT THE F#CK ARE YOU DOING ON THIS BLOG?? WITH 80 HOURS WEEK YOU’D HAVE NO TIME TO BLOG…
it’s just does not add up….
You are desperate home-investor who are about to be FK by a bank… NO hope for you here
the market has bottomed out. it is always good time to buy. Don’t get misled by the media.
# Clotpoll Says:
April 24th, 2007 at 7:18 pm
chifi (139)-
This is a big-time opportunity! I’ve been waiting for this for years. Clean out all the part-timers, bored housewives and genetic mistakes from our business…now is all about sellers who have to sell and buyers who have to buy.
Let all the morons make $9 an hour at Barnes & Noble.
Which buyer HAVE TO BUY???
Except trading rental property for another rental property??
bobokenite –
I am curious – how far do you think housing prices are going to fall. When i bought my 3 br cape starter house in 1999 i put $28k down and had a manageable $252k mortgage. The young family that bought the house from me in 2005 put down $24k (5%) and had $456k mortgage. assuming the value of the house dropped 10% to $432k if you put 10% down you still would have a $390 mortgage. too me it simply is not worth it to have a $390k mortgage on a 3 br starter house. I would take my $400 k and by a real nice house in NC.
Big Al –
Just finished a major project at work and decided to take some down time this afternoon. Haven’t taken any down time since I got back from Naples Fla in early march after I finished my last huge case. Now if you want to see a real estate market in freefall I suggest that you check out Naples. My relationship with my secretary is strictly professional and I would be the first one to tell you that she is the brians behind the operation.
think it through –
I use westlaw not lexis
Actually I am quite little Al…..
May be in the future, I will gladly accept Big Al Title but right now I do not deem it appropriate.
As far as Florida – I believe nobody talks about market there now – it is as dead as RE market can be.
Still instead of hanging out with your kids you are spending your time here… Internet is evil – poor neglected babies all over the world because of Internet!!!
castleking Says:
April 24th, 2007 at 8:44 pm
I am curious – how far do you think housing prices are going to fall.
______
How much did they appreciate 2000-2005?
How much did incomes increase during this time period?
How much did property taxes increase, and what is the likelihood of further significant increases?
How many neg-am, I/O, no down payment, stated income loans were given to people of questionable means? All of whom were competing with each other to outbid for that house that was sure to pay off big so they could flip and cash out?
The easy-credit spigot is being tightened significantly. How much will this impact prices?
I guess there’s really no reason to be concerned.
hobokenite –
I am curious – are you looking to buy in Hoboken or move out to the suburbs. I am a big fan of hoboken ( i got engaged at Frankie and Johnies) as long as you get parking with your property.
little Al –
this is my first time on this site and I am enjoying myself. You can tell by my typos that I do not spend a lot of time on the net – other than westlaw.
the market has bottomed out. it is always good time to buy. Don’t get misled by the media.
So what you are saying is we should ignore the media and trust an anonymous person posting on an internet message board?
You do realize that the worst piece of news today was provided by the Realtors, don’t you?
jb
steve –
i hear what you are saying but I look around and houses are still selling. I am in a fortunate position -i am in my house for the long haul and have 15 yr mortgage. I am commited to paying that sucker off and then living rent/mortgate free for the rest of my life. i just don’t want to see you wait around for a crash that might not happen.
this is my first time on this site and I am enjoying myself.
Glad to have you here.
jb
With current disbalance between rents/houses prices it is more financially prudent to rent…
And About living mortgage free – are you living in NJ??? the Capital Of property taxes of the world!!!!!
jb –
thanks “big brother”. On a serious note, I think that you have a fantastic site here and I plan on returning to try to gauge when the time is right to potentially pull the trigger on a second home down the shore. please advise if you thought that I was too abrasive with njgal. I just didn’t care to be lectured by someone who i found to be hypocritical.
castle [282],
That depends on your definition of far. Is this a rhetorical question? Haven’t you answered your own question.
“I plan on returning”
castle,
Threat or promise? Seriously, I sure hope so. Where the hell are you going? Sounds like hit and run. Is there a lawyer in the house?
little Al –
I have 4 kids in a real good school system. I live within walking distance of the school. My wife walks my kids to school every day down a clean safe street. I feel that I am getting my money’s worth for my property taxes especially when you factor in my tax deduction for the property taxes.
BC Bob –
I have enjoyed chatting with you. However, I am looking at a big pile of documents for my next legal challenge. I am taking a break this pm but will be back on a mission tommorrow am
Come on guys – put your money where your mouth is. How much will the median price of a starter house in NJ fall in the next 12 months?
The existing home sales numbers were truly awful and by all accounts the new home market is in even worse shape. This is not a healthy situation. We are starting to see a correction of an extended imbalance between price and fundamentals.
Our local NNJ inventory is increasing at a good clip. There is distress in the subprime lenders that may be spreading. Houses are languishing a year or more on the market.
There is nothing wrong with homeownership per se, or the cliched lifestyles of those who espouse homeownership as the fulfillment of the American dream.
As an investor, I look for value and opportunity. As a prospective real estate buyer, I expect to do the same. If a target property meets my criteria I will bid. I try to keep emotion out of the purchase decision. Renting is always a viable option, as is homeownership, under the right circumstances.
For about the last five years, the RE market has favored sellers. That is changing. Buyers are empowered, educated, informed and the whole buying process more transparent thanks to the internet and blogs like this one.
I’m much better equipped to make an intelligent buying decision than I was just a year ago, thanks to Grim, many of the posters here, and a few of the RE professionals who choose to share their wit and wisdom.
I always find an item of interest here. Grim’s “clipping service” of RE related articles is itself worth the price of admission. Houses are still being bought and sold and will continue to be as long as people want and are willing to pay for them.
I remember 1989 and the years that followed. That juicy steak can quickly turn to ashes if any unexpected event transpires. The loss of a spouse, or spouse’s income, loss of primary earner’s job, or job transfer, medical emergency–anything. Then one might have to sell in the teeth of a RE bear market. Your open houses attract no lookers, your showings wither and die and after six to eight months you have only one lowball offer to consider. Your downpayment is on the line, maybe your credit too. What do you do? Throw another steak on the barbie?
Take off the rose-colored glasses and those kids playing on the lawn might be vultures lining up for an auction.
“the market has bottomed out. it is always good time to buy. Don’t get misled by the media”
The market has not bottomed out.
Market timing is everything, its not “always” a good time to buy.
Yes, the media misleads….as does your post.
SAS
Castleking: Yup, I know all about Naples. My father lives there. I think there are over 100 houses on the market in his community. He bought in 1997, so they are OK even if prices drop by half. But the builders are going nuts — offering discounts like crazy — but the building and the condo conversions go on. And the people who serve that burgeoning community can’t afford to live there.
“Come on guys – put your money where your mouth is. How much will the median price of a starter house in NJ fall in the next 12 months?”
-Enough to make anyone who bought in the past 2 years upside.
SAS
down
SAS ;)
There is a cable tv chanel in Naples where all day long they show listing after listing from most expensive to least expensive. there has to be over 500 properties for sale
SAS –
give me number.
Homer had to throw his 2 sence in.
Anyone who says ohh being a renter is a waste of money is not that bright. Why would anyone waste there money when prices will continue to drop. Oooh let me run out and spend 350k on a 1000 square foot house with hardly any yard and 8000.00 per year on property tax. The heck with that I currently reside in a 1230 square foot apartment thats bigger than many house and condos out there. And I am moving in July with my wife to a 2 bed townhouse 1350 square feet for around 1260/month. In Lawrenceville that has a excellent school systems. Its a safe area. People say if you rent your just throwing away your money and in a way that is true, but in the same aspect your really not. Your paying for a place to live and since you not making any money when you leave your throwing it away.
I just think thats a very poor way of looking at renting. I rent becuase I cannot afford these prices. Nor would I want to. In the same turn if I purchase a place tommarrow and in 1 years time the vaule is 15% lower than when I bought it, I just threw away money. Renting has the pretty much the same bennifit as owning a condo…I can paint, change things, but I can’t make money on them. If something breaks I call maintenance, don’t have to pay for it. Our lawn gets mowed. I do not have to pay taxes directly, I don’t have to pay a maintenance fee, its part of rent, and I pay a whole lot less than people who condo’s and my place is bigger. So the only downside is I will not make money….Ohhh no life is over as we know it….If you really want to get technical about your not really making money on buying a condo.
Purchase a condo
350,000 financed
6.5% apr
Monthly Payment 2212.00/mo
Taxes 6000/yr 500.00/mo
Maint 200.00/mo
—————————-
Total monthly 2912.00/mo (just around 2 and a half more times than I pay on rent)
2912.00
* 12 months
—————–
$34,944.00/year
* 10 years
————————
$349,944.00 in 10 years (better hope the market is good when you sell)
If you are financing 350,000.00 on a house
with taxes at 6000.00 no maintenance over 15 years is 488,160.00 invested in that property, so if you really want to make a profit you will have to sell if for over $488,160.00 Good luck with that.
Since my example the property taxes did not go up we will assume my rent never goes up.
1260.00
* 12 months
—————
$15,120.00
* 15 years
——————–
$226,800.00 no money made but no money lost
SO please tell me why owning is better than renting???
“Either way – once again there are additional intangible factors that go into the home buying decision other than simple numbers.”
Easy to say for $200/hour lawyers who just made “more money than they deserve” selling a previous house.
In an earlier post you wrote:
“I started practicing law in 1994, scraped together a $28k down payment and bought my first house in 1999”
So it took you 5 years to buy a home, at the bottom of the trough:
http://graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
And you throw stones at first time buyers looking at the absurd peak / absolute top in over 100 years?
unrealtor –
i am not throwing stones. read the rest of my post. If I started practicing law in 2004 instead of 1994 I would be out of NJ in a flash. It does not make any sense to pay these prices for a starter house. NY City transplants bought my starter house in 2005. It seems that these NY city transplants keep coming and paying these ridiculous prices. Even if prices go down 20% – which they probably won’t – it still isn’t worth it.
castleking Says:
April 24th, 2007 at 9:19 pm
Come on guys – put your money where your mouth is. How much will the median price of a starter house in NJ fall in the next 12 months?
cadaver: We have long discussed the concerns we have about this metric and the problems with mix creating distortions.
To regurgitate an old example: 1 2 3 4 5 are five houses that sell.
The market weakens and everything loses 10% of value. 0.9, 1.8, 2.7, 3.6, 4.5.
In the new market, the buyer of the lowest priced property has been removed due to lack of the ability to obtain financing.
The remaining sales are 1.8, 2.7, 3.6 & 4.5. The new median price is 3.15, or a 5% increase.
DOES THAT REALLY REFLECT AN APPRECIATION IN THE MARKET?
castleking,
That remains to be seen. For now it’s a no-brainer to rent until the market corrects. This can be either through falling prices, or through increased wages (i.e. wage inflation). Considering the anemic growth of wages in the NYC market (outside of wall st. of course), I expect it will be through falling prices. A worst case scenario for me (what I would consider a best case scenario for a current homeowner) prices will remain flat for 5+ years while wages catch up. But to answer your question, I believe the market is overpriced by 25%+.
chicagoserf-
good to see that you are back from the fields. Give me a % – 1 year from today how much will the ave house – or whatever term you want to give it – have fallen?
“How much will the median price of a starter house in NJ fall in the next 12 months?”
castle,
Where will November 2009 soybeans be trading in March 2008?
Why not use the Case Shiller index for the NYC market?
BC –
Most of the posters on this site seem to be predicting a market crash. Put your prediction on the record. How steep will the impending correction be. Are you afraid to be proven wrong?
Most people do not realize how easy it is to obtain enough details about them after a number of posts to make discovering their identities possible.
Anonymity is rendered illusory by time and analysis.
Castleking wants a number — in modern times each real estate bust has been equal in duration and magnitude as the boom:
http://graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
Using history as an indicator (see chart) expect 5+ years of pain, and about 40% declines (inflation adjusted) from the peak.
Don’t blame me, that’s just history talking.
Unrealtor –
That is awesome news. If I keep plugging away for 5 years I am going to be able to score a real solid shore house. That could be the most encouraging news that I heard in a month.
castleking,
So what’s you’re prediction for prices a year from now?
castle,
Afraid to be proven wrong? HAH. Please visit on a regular basis. I hate to bore the regulars, continually repeating myself. Just to make sure the jury is awake. For the umpteenth time; the biggest real estate bust of all time. One of the biggest financial busts of all time, [multiplier effect]. I have not deviated from day one. From peak to trough, 30-40% decline. The nonsensical, superficial gains will be completely erased. Each action has a corresponding reaction, this will be no different. However, there will be no instant gratification, a slow, plodding decline, maybe 5 years or more.
hobokenite –
I really don’t know – you guys are the experts – this is my first time on this site. If I had to guess, i would say that prices are probably already down 5% -10% from their peak and will sink another 5%-10% over the next 12 months.
BC Bob –
Are you saying March 2010 we will bottom out? Should a continue to contribute to my shore house fund until that date?
cadaver: why don’t you spend more time reading and less time making mandates?
Based on your hyperactive postings, clear self-absorption, and ADHD-tinged patience, I actually believe you graduated law school in 2004. You behave like one of the Gen-Y kids were discussed last Friday.
You have now volunteered to wear a large red plastic sphere on your nose until you prove otherwise. You are a clown.
[319],
It could be 4 years, it may be 7 years. Hell, possibly Japan 1990. Why worry, put down 40% and ride the wave.
chicagoserf –
I like the aggression. Is the neighboring tenant in your condo complex banging on the wall and preventing you from sleeping? I am a trial attorney – I have no problem playing the role of a clown if it will help me win a case. I am just trying to get educated and keep the conversation going. If the people on this board want me to leave I will be happy to wish everyone luck and sign off.
castleking Says:
April 24th, 2007 at 10:14 pm
hicagoserf – Is the neighboring tenant in your condo complex banging on the wall and preventing you from sleeping?
Hunter Charles does a fantastical job without any assistance needed.
who is hunter charles?
castleking,
My guesstimate would have been the same as yours (5-10%), but the apparent speed of the collapse of the credit bubble has me thinking it may be more (10-15%).
cadaver:
Hunter is chicago jr. and this image captures his opinion of you….
https://njrereport.com/images/Picture_170_Prip.jpg
Incidentally, I was wondering about the decline in inventory in the NAR report. I wonder if the decline in inventory is due to people going the FSBO route since they’d have to bring cash to closing otherwise.
castle –
i think the reason some people on this blog are irritated by you is that you seem to imply that the only way to create good memories is to own- that in order to be a good parent you need to own- that if you care about good schools you need to own.
you also seem sort of preoccupied with leaving assets to your children after you’re dead. that’s nice – but don’t you think you’re kids would rather have you around home more?
Al (280)-
There are buyers out there who are trading up, trading down, transferring in or are otherwise unmoved by the tiny voices of doom in far corners of the blogosphere. They have decent credit, have done enough homework to know they can get a good deal, have a few bucks (either from the sale of a previous home or savings), have a long ownership horizon…and have absolutely no taste for the rent-vs-own arbitrage game, shuffling from lease-to-lease every 12 months or making landlords rich. They are buying precisely because the minutiae of RE that keeps us humming here is of no interest to them; they are able to own, they can pay, they will not consider the alternative, and that’s it. We should all remember that our little crew here is a fraction of a blister on the backside of a flea; collectively, we can neither trigger a mass buying spree nor stop the market cold. The trolling comments here- aside from being the funniest- also hint at the megalomania of individuals who believe that any of us can have an iota of influence on the market as a whole.
Not every buyer out there is a wild-eyed, gambling financial moron who wants to lever up 10-1 with exotic financing. And, many people who are able to buy homes do so because they find it unconscionable to pay someone else’s mortgage and expenses…no matter where today’s market is or how many rent/own calculators tell them not to do it.
I’m not here to judge anyone’s personal choices; if you are happy with the roof over your head (and it’s not sending you into BK), then God bless you. Some years the market runs, some years it’s down. Today’s situation will pass; in 2-3 years, the collective American memory will core-dump once again, and the boom cycle will be back…in a newer, crazier and more noxious form than ever before. I’m a 47 y/o lifer in this biz, and I’ve already lived thru three massive boom/bust cycles…and I expect more of the same for as long as I continue to draw breath.
In 1980, good RE companies gained market share during the depths of a horrifying market. In 1991, good RE companies gained marke share in the midst of a complete collapse of the thrift business. From now- and for the next couple of years- good RE companies will gain market share in the midst of a RE collapse brought on by massive liquidity chasing too few genuinely-profitable opportunities.
I’d say atleast 30-35% from peak to trough. I am fairly new to this site as well as to the RE market since i am a new immigrant. You can obviously see that some places have appreciated almost 70% in the last 5-6 years.
CastleKing, take your starter home. You bought it for 280k and sold it for 480k in a matter of 7-8 years. I know of a friend who bought a first house in May/Jun 2005 for 550k. The house was 6 years old and the previous owner had paid 300k for the same thing. That’s 70% appreciation in 6 years. Even if all this can be attributed to “excellent RE market”, everything has to obey the laws of physics. Every action has an equal and opposite reaction and what goes up has to come down.
By the way, I am a renter looking to buy a great home in utopian ave in a friggin’ fairyland for pennies on the dollar.
Castleking,
Welcome to the blog. Looks like you have made quite the splash on your day off. It sounds like other than the offensive comments made by a few re: current homeowners, you really don’t have a problem that this blog and the community exists. In fact, it sounds like you would also like to see prices drop some before plunging in for that 2nd house. I really don’t think you need to wait like most on this site are doing. Here’s why. It sounds like you have a few things going for you that most recent homebuyers don’t have going for them (1) a high salary, (2) a large DP, and (3)the ability to weather any future job/family life disruption (I am making this assumption given that you are planning being in your home for next 15 years or more). I think you are one of the folks that Clot (he’s one of our resident realtors (if you are not familiar with him or his philosophy) would classify as “someone who has an economic/family sitation that requires/allows” to buy in the current environment. Why not, as BC suggested, put 40% down on that shore house and ride the wave? A 5-10% decline is something you could definitely weather even if you had to pull some equity out of your primary house to get those family memories started as early as possible. You are in a much better position than most, you really have less to worry about even if there is the slightest chance that the market corrects itself more than 10%. Then, you can just laugh at all of us sideline benchwarmers TWICE as hard.
afe
CF,
I thought Reech was the court jester. Do we need another one?
Definitely a trial lawyer – arguing for the sake of arguing.
Is he a good one? So far, he hasn’t won the jury. Let’s see how the story unfolds.
Talk to my buddy, a Greenwich real estate lawyer. Over $3M market has not been affected too much, though it’s tad bit slow.
And I love laywers – they have this sharp useless look about them. :)
hobokenite (326)-
If you’re skating close to the edge of having to bring cash to your closing, selling FSBO is only a way to guarantee you’ll have to bring more.
In addition to owning a RE company, I’m an investor. When I’m looking to buy, I only consider FSBOs…and I’m far from alone in that. In fact, several years ago, I actually considered surrendering my license so that I could utilize a few techniques that are perfectly fine for a private buyer to use in de-pantsing a FSBO…but not very ethical for a Realtor to employ.
In fact, I considered it for a long, long time.
BC,
I will tell my kid to consider BC as a “safety” school as Castle suggested. hahaha.. Just kidding. :)
Actually, Mike Eruzione kept telling my kid to consider BU. hahahaha..
Talk to my realtor about Bergen County – he sounds down. He was hoping for Spring rebound but hasn’t seen it yet.
“Come on guys – put your money where your mouth is. How much will the median price of a starter house in NJ fall in the next 12 months?”
If all goes well with this world, no recessions and no Asians trying to find how decoupled their economy is from US..If there is no sudden oil squeeze or if interest rates dont shoot up to 18%, Then the nominal prices could go down another 10%, real prices much more. In my town prices are already down 10% in nominal terms.
According to my calculation with inflation adjusted, the “normal” price should be 28% off from the peak Summer 2005 price.
Right now, it’s about 5-10% off. It will take another 2-3 years before it bottoms out. Then it will stay flat for another 3-4 years.
If KING is so worried in his 15 Yr. Castle, think all those poor guys loosing their homes now. Some of those guys would be having kids too
Clot,
Useful information. One of the reasons I was thinking it might be caused by an increase in FSBO’s is that I seem to see alot of them around town. It seems like there’s more of them than there were at this time last year (or all of last year for that matter). But I do have to admit, I wasn’t paying as close attention at this time last year, so maybe I’m imagining that part.
I saw 3 almost identical houses in the same neighbourhood. – one house at $1.07M, another one at $1.16 and the last one at $1.29M.
I don’t think “average” folks understand the CURRNET real estate market and that includes most of the clueless realtors – time for them to go back and spray the perfume at Macy’s.
Tom –
I am not suggesting that the only way to obtain good memories and properly take care of your family is by owning. Maybe I am getting old and soft but what i am trying to suggest is that there is a definite value to permanence. So much of our society today is transient. In my view it is advantageous to allow your family to put down solid roots – attend the same school every year, stay in the same neighborhood go to the same house for a vacation. Create a safe secure and permenant environment that your family can flourish in.
MJ,
I don’t think King is worried. To set the record straight, I believe that he was talking about the intangible benefits of owning a house.
Hobroke (337)-
Yeah, a lot of upside-down people use the logic of “saving” the potential commish by trying to sell their homes themselves. I know that there are a lot of folks everywhere trying it these days, as they feel they have no other choice.
It’s just unfortunate that what seems to be logical almost always ends in failure, as FSBO homes either never draw an offer…or draw the interest of a professional investor who then skins the seller alive.
afe and clotpoll –
thanks for the post. your optimism in the midst of all of this negativity is like a welcoming beacon from a lighthouse shining over a dreary sea. I am going to sit on the sidelines for a year – at least – and hope that I can get more house for my buck next year.
Clot,
That’s not fair to attack “professional investor”. I would like to look at it as.. mutually beneficial transaction. hahaha (I look at my commercial building purchase of 2001 (or was it 2002?) as a “fair” deal – at least to me (it was FSBO) hahaha..
I really don’t understand FSBO deal at current market. It worked great during 03-05 but now? Why would you want to FSBO?
Maybe I am getting old and soft but what i am trying to suggest is that there is a definite value to permanence
Castleking,
Permanence is not a good thing if it involves being underwater on your mortgage permanently. Again, economic affluence allows one to provide permanence when needed, transience when needed. Most on this site are making the decisions that each thinks is the best choice given their economic/family situation…
if the shoe doesn’t fit….
I am still struggling with this vacation home concept. Why would you want to go to the same place year after year?
Aren’t there plenty of places we can visit rather than going to the same place over and over again?
PLEASE PLEASE PLEASE have the next function at JR Cigar!!!
RE 187,
that sounds dangerous. Have a friend whose situation mirrors Castle’s…searching desperately for a better “quality of life” job so that he can see the kids every day. Wife also getting antsy at home…..careful!
afe –
I am not judging anyone elses decision. I am just responding to Tom’s post. My basic position is that there are intangible benifits to owning a home.
CF,
which JR Cigar? one in Livingston? (or is that Parsippany? or Paramus?
investordavid –
My free time is precious. When I find a place that I love – Naples Fla winter Jersey shore summer – I don’t need to take a chance and go somewhere else. I like to really get to know a particular place and partake in the simple pleasures and get to know back roads rather than be a tourist being led from tourist trap to tourist trap on every vacation.
and we live in jersey for the entertainment value.
http://www.nj.com/news/expresstimes/nj/index.ssf?/base/news-5/117739033452180.xml&coll=2
Castle,
who said anything about being led to tourist trap?
I myself can’t stand those tour package.
There are too many places to see before we die – drinking coffee at a small cafe in the middle of nowhere near Alps in front of the lake, B&B at a farm house in outskirts of Auckland on a rainy day, eating home made shepard pie, trying to “enjoy” haggis wondering, hey, is he wearing a boxer underneath his “skirts”?
investordavid –
I need a place where I know that my blackberry is going to work
and I thought you wanted more time with your kids.
I said this before but I came to an epoch shattering epiphany that I am allergic to work.
I have 2 kids and I feel like I am spending more time driving my older son around for his activities than working.
And some of my clients have this misinformed notion that they own me just because they pay me.
Castle, I think you’re missing the big message and getting caught up in the details.
The big message is: most here want to buy a nice house with a yard, want to establish “roots,” etc.
However, they’re not willing to commit financial suicide by entering the market at 100-year-peak prices. You have already stated in #248 that you would also not enter the market at these prices.
So what’s left? Moving out of NJ? That’s always an option, but doesn’t packing up and moving across the country for shelter conflict with the whole “roots” meme?
It seems your ‘vision’ is so clouded by your personal good fortune, that you cannot grasp that not everyone had the blind luck to buy at market bottom and sell 5 years later at a 100-year market peak, and not everyone can pick up and move across country to find shelter.
Castle,
I’ve tried long hours, high pay and fewer hours with less pay. I like the latter better. That’s me though, maybe that’s not for everyone. Just make sure to check yourself in the mirror every now and then. I think you are going for what is valuble in your heart and that’s the most important thing…as long as all of your team is on board!
St. Peter, I think you guys made a mistake. I am too young to be here.
St. Peter: according to your billing hours, you are 96 years old.
Tempus fugit. Carpe Diem.
I still remember my older son trying to skate when he was 3. Now, I don’t know where all the time has gone.
Unrealtor,
Credis Quod Habes Et Habes.
Unrealtor,
No need to get angry or bitter.
Owning a home is not all it cracks up to be – new fence, new roof, redo the driveway (still waiting the gold filled trailer from BC Bob and Clot), planting flowers (fighting the deer for eating all my flowers every year), pipe backing up, my little one thinks that he is Leonardo Da Vinci and White clean wall is his canvas and the pain of Flooding last week, etc. etc. etc.
But most of all, my property tax going up over 100% in 7 years.
castleking Says:
April 24th, 2007 at 9:01 pm
steve –
i hear what you are saying but I look around and houses are still selling…. i just don’t want to see you wait around for a crash that might not happen.
________
CK,
I actually sold my place in August of ’05 because I saw so much craziness around me. To be fair, I owned a (nice) “condoshack” – not a SFH – which I felt could easily get pounded by the comps, of which there are at least 20,000 units under construction in my ‘hood. When I sold, there were only 3 condos for sale in my immediate area. That, and the absolutely ridiculous taxes, were enough to convince me to sit out for a bit.
I can’t tell you how many “drive by appraisals” I saw happening, how many crazy mortgages I saw my lender (Countrywide) selling, riskier and riskier. My cousin, working for a mortgage broker in San Diego, went on at length about how they were giving out loans to people without jobs – no joke – on a regular basis.
If I had a family, wasn’t single, the equation would surely be different. But even then, the opportunity cost to wait out 1-2 years seems worth it. I’ve seen definitive 10% drops as of about 9 months ago, so I figure a total of 35-40% off condos, 25% off sf houses from peak – not taking into account inflation – is certainly reasonable. Honestly, for a yr or two, could be much worse, esp when we hit the next recession and there are some layoffs to add pressure. There will be people at the margin who have to sell, and they will set the market.
There was a time, I’ll certainly attest, when I feared getting “priced out” and considered for a fleeting moment, one of those sketchy mortgages. I would say I’m pretty darn conservative, and the fact I had a second thought about going to the Dark Side gives me that much more conviction now, ’cause many people did…greed, desperation or just a couple little kiddies bouncing off the walls.
No one can tell the future, but you can look at probabilities. Most people don’t have the benefit of information like this blog, they just read newspaper articles well after the fact and make decisions based on very little real information…
unrealtor –
i busted my tail for 5 years as a slave/associate at a large sweatshop firm to save for my down payment on my first house. it was more than blind luck that got me that house,
i understand that many people have been priced out of the market. my belief is that it is no longer worth the sacrifice to stretch to purchase a home in nj. don’t root for overextended people to be routed from their homes. move and set up roots in another part of our country.
The problem with that theory is that most of the rest of the country is overpriced as well.
Kim@112: I think you’ve made a wise decision. When we bought our POS cape in 1996, prices were at the bottom of the market and while some things had been updated, nothing had been done since 1975. But ours was dormered and finished upstairs so at least the space was there and done already. That said, we had this idea that we would be able to do all the updating we wanted within five years. It is now 11 years later and we are still living with the 40-year-old deep “Italian red” carpeting (which is WOOL and still in decent shape, alas, but it’s RED), we’re doing a spruce-up rather than a full kitchen remodel, and we’re just now replacing the olive green bathroom fixtures in the upstairs bath (tub to be handled later on). But we’ve done the big stuff — upgraded the electric to 200 amp service, new oil burner, siding, windows. We don’t take equity loans for these improvements, we wait till we have saved enough cash. But there’s always something — water heaters go, furnaces go, storms bring water into the basement so you have to rip up the carpet (that’s the latest). So sometimes “we could live with it for a while” can turn into more years than you think.
I don’t know what town the POS cape you looked at is in, but where I’m sitting here in Bergen County, $450K, or even $400K, for a postwar cape in which nothing has been done since 1952, and the upstairs isn’t finished, is preposterous. Sit tight, put a bit more money away, and when prices come down, get a house that’s more of what you want.
” I just didn’t care to be lectured by someone who i found to be hypocritical.”
How am I hypocritical by the way? I just don’t get it. Nothing hypocritical about me – a hypocrite is a person who says one thing and does another. That’s not me at all. I’m just offering my experience as a kid raised with all the material goods you think are the best and realizing that it’s not all that you have made it out to be in your mind. But fine, whatever, think I’m a hypocrite.
NJGal, NJGal. C’mon. How long did it take you to rise to the level of LOD?
I really missed the action yesterday, falling asleep at 8. It’s always refreshing when a possible initiate shows up and starts out sucker punching (cause he doesn’t go back and read the casefile) but moves quickly to the balance. http://tinyurl.com/yozthj
Required prerequisite reading for every new reader should be the plankton article(for insight into how sh*t rolls uphill in RE), one of the many links on the impacts of leverage on the s/d curve, and a concise guide to economic indicators.
Make..how you been?
JC @ 357 – Great points… thanks!!!
One more thing, Kim: We were 40 by the time we’d saved enough money for even a 10% down payment — and when we started hunting, we saw that everything we really liked was just a bit more than we were able to pay — so we waited a year, saved some more money, and then looked in our price range.
Obviously anyone who did that between, say, 2003 and 2005 was a moron, but I think now is not a bad time to sit tight.
It’s funny that in all the discussion of rent vs. own the issue of pets has never come up. For me, the biggest plus of homeownership (other than being able to paint whatever color you want) is that you don’t have to beg landlords to let you have a cat. I always hated being treated like a child where pets were concerned, but rather that being less prevalent, it looks like “no pets” is becoming MORE so. When I used to volunteer at the Bergen County Animal Shelter, I can’t tell you how many pets were turned in because the owners were moving to a rental that didn’t allow pets.
“No need to get angry or bitter.”
No worries, I’m neither. :)
“NJGal, NJGal. C’mon. How long did it take you to rise to the level of LOD?
I really missed the action yesterday, falling asleep at 8.”
Ha, I’ve been LOD since the day I was born. And I have no shame from that.
I tried to fall asleep at 8, but got caught up with my sick dog. Then House came on, and you know the drill…this pregnancy thing has just killed my normal sleep schedule.
“i busted my tail for 5 years as a slave/associate at a large sweatshop firm to save for my down payment on my first house. it was more than blind luck that got me that house”
I.e., people who don’t want to buy at a 100-year market peak are not working hard?
It was blind luck.
Tomorrow I can put 50% down on a substantial home in a “top town,” but that would be moronic, at these prices. I just didn’t have your luck to buy at market bottom:
http://graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
“move and set up roots in another part of our country.”
Yes, you’ve mentioned this several times, but that assumes there are no roots already established in NJ, or that someone should have to cut them to shelter their family.
JC #371.. thanks again. We’re 37 and haven’t bought our first house. We spent our younger years traveling and spending all of our money – not really saving. No regrets though – my friends who bought in the 90s at the bottom have beautiful houses and equity, but we had more fun and have better stories to tell! It’s all how you look at things, I guess.