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>Housing Recession Taking its Toll on Toll Brothers
watch http://www.paperdinero.com/BNN.aspx?id=177
CNBC segment recounts the truly ugly preliminary results from Toll Brothers for Q2 2007. Spotlights the $90 – $130 million in additional write-downs for Q2 pushing the current year total exceptionally far beyond Toll’s expectations as well as easily surpassing the full year 2006 total.
Originally aired on: 5/9/2007 on CNBC
Running Time: 2 minutes 12 seconds
From the Star Ledger:
New try for old property tax plan
Hours after Gov. Jon Corzine signed into law the final bill from the Legislature’s special session on property taxes, an Assembly committee yesterday revived a controversial plan to use a penny of the state sales tax solely for property tax relief.
The Appropriations Committee unanimously approved with little comment a bill asking voters to amend the state constitution to dedicate one cent from the state’s 7-cent sales tax — about $1.4 billion in revenue this year — to offset sky-high property taxes.
The idea was suggested last year by Assembly Speaker Joseph Roberts (D-Camden), when lawmakers agreed to raise the sales tax in order to balance the state budget.
Corzine generally opposes dedicating revenues to a specific purpose, saying it doesn’t give him enough flexibility in writing a budget. His battle with Roberts over the issue last year was a key factor in the budget stalemate that led to a week-long shutdown of state government.
The money from the sales tax increase last year provided much of the funding for a 20 percent property tax rebate this year. Lawmakers have made that rebate the centerpiece of their six-month special session on property tax reform.
China Says April Trade Surplus Nearly $17 Billion, Double From the Previous Month
http://biz.yahoo.com/ap/070511/china_trade_surplus.html?.v=10
From BusinessWeek/Hot Property:
The Yield Spread Premium: A Dirty Not-So-Secret In Real Estate
“The YSP or “Yield Spread Premium” is nothing more than the Bank’s kickback to the broker for doing the loan. The worse the loan, in terms of interest rate, that the broker gets the borrower to agree to, the higher the YSP dollars go to the broker. What exactly, other than honesty, is the broker’s motivation for helping a borrower get the best available deal? Combine greed, low barrier to entry and minimal mandated disclosures and you have a recipe for a lending disaster at the borrower level. Until there are mandated disclosures that spell out, in 14-point type and plain language, what exactly a borrower is encumbering themselves to in total and how the broker or bank is compensated this system will continue to fail the public.”
Roubini versus Cowen in the “Debate Room”:
Stop Fleecing Poor Americans
The U.S. government should place greater restrictions on car sellers, pay-day lenders, and tax preparers who offer the working poor cash or credit with high fees and interest rates. Pro or con?
…
Pro: Exploitation, Plain and Simple
by Nouriel Roubini
…
The carnage and ruin caused by the subprime meltdown serves as a lesson in what can happen when credit markets balloon without the benefit of appropriate supervision and regulation. The subprime fiasco threatens to cause a generalized crunch in consumer credit that will lead to a hard landing, and possibly a recession, for the entire U.S. economy.
…
Con: Treat Borrowers Like Adults
by Tyler Cowen
…
“Life, liberty, and the pursuit of happiness” should include the right to borrow money without coercive interference from government.
The Americans who pay high interest rates to pay-day, car-loan, and other lenders fall into two broad categories. The first consists of people who genuinely need the money now. They need to pay a doctor’s bill, move into a new house, or buy an engagement ring. Yes, the lenders charge a high rate of interest, but most of these people qualify as potentially bad or unknown credit risks. There are hundreds or thousands of lenders competing to give borrowers the best deal possible. These borrowers have decided to pay the price for up-front money, and no one has any business trying to stop them.
From the Courier Post:
Foreclosure ‘rescue’ scams exploit more homeowners
As the number of people falling behind on their mortgages has soared, so too has the number of schemes that cost homeowners their houses.
Regulators are cracking down on these supposed foreclosure-rescue groups, and in some states, legislation is in the works to make it easier to prosecute those who prey on homeowners.
…
The foreclosure-rescue groups are getting creative in how they try to befriend the homeowner,” she said. “But ultimately, it’s financial exploitation.”
Foreclosure scams have been around for a while. They are increasing because subprime loans are putting more homeowners in precarious positions as their interest rates climb.
From the graphs JB posted in the previous thread, it appears that june/july is generally the peak for home sales. Since *used-home* sales are recorded at closing, these probably went into contract anywhere from one to three months prior to that. I would guess that the inventory numbers in gsmls over the next two months will be a good indicator of how the rest of the year will be. As homes complete attorney review in the next two months, they should drop off the available inventory.
If homes are still hanging around after spring, Good luck to the sellers waiting for the Spring 2008 recovery.
I predict that gsmls will peak at about 35000 homes available this year.
Buyers, this is just the appetizer, the main course will be served from winter 2007, so don’t stuff your self yet !
Is the state setting a dangerous precedent?
Marcal gets its job-saving tax break
Marcal Paper Mills Inc. will get its energy tax break.
The seven-year-long break became law Thursday after Governor Corzine opted not to take action on the legislation, which was approved by the Senate March 12 and the Assembly a month earlier.
When the Elmwood Park-based manufacturer filed for bankruptcy in November it blamed many of its problems on rising energy costs. The sales tax break on energy use is expected to save the company $2.9 million to $4 million a year.
Although the bill does not mention Marcal, it is written so narrowly that few – if any – other companies fit the description of those companies eligible for the break.
More from Buffett and Munger. Sorry, no link.
On the housing market woes, Buffett noted how Berskshire’s housing-related businesses are getting hit. Unlike many overeager investors today, who feel compelled to run into burning buildings by buying flaming housing-related stocks on the theory that the worst is over, Buffett offered a contrary view: “My guess is that it continues for quite a while.”
No elaboration on how long is “quite a while.” But these guys think in glacial terms. Long-term is a lifetime. Therefore, “quite awhile” could mean at least “years.”
On the private equity bubble – which involves so-called private equity firms raising huge pools of money and then borrowing a lot more to buy whole companies – Buffett noted a great flaw in the scheme. Private equity firms have a “great compulsion to invest quickly.” That way, they can go out and raise another fund and keep the fees coming in. Basically, private equity firms are paid for activity, not results. And the nature of the business means that we won’t know who is successful until many years have passed.
Buffett said the “score card is lacking.”
On management compensation schemes, Buffett put the issue in perspective: “There are more problems from having the wrong management than having the wrong compensation structure. It’s more important to have the right people.”
On the record level of corporate profits in America, Buffett acknowledged the all-time high. He noted it is a weird world we live in where companies are getting 20% returns on tangible capital in a world where the long-dated T bond is yielding 4.75%. “At the moment, Corporate America is living in the best of all worlds.” History shows that these episodes don’t last.
Munger added that much of the record profit growth stems from the massive financial center, a fact that “has no precedent.”
On the best way to become a better investor, Buffett advised: “Read everything you can… after that, you have to jump in the water.” He said the difference between investing with play money and investing with real money is like the difference between reading a romance novel and doing something else.
On the health care mess, Munger said: “It’s too tough.” Buffett added: “We look for easy problems.” That may sound like a cop-out to some, but it is the core of a brilliant idea about the nature of good investing. Buffett commented how their success is not because their winners were any bigger than anyone else’s. It’s that they managed to avoid big setbacks. He mentioned a guy who was smart 99 times out of 100, but that 100th time did him in. Gotta avoid that.
On derivatives, Buffett noted how derivatives increase leverage – a “largely invisible leverage.” That could make a crash or downturn even worse, like adding gasoline to a fire. This is one of the big risks in the market today – the heavy derivative use by many firms. These instruments are untested in a crisis. We really don’t know how they will act or what they will cause people to do.
Buffett invoked the ’87 crash as an act of forced selling. “We may not know where the danger begins or ends” with regard to derivatives. Munger added that the accounting for these instruments was deficient. People are getting paid for profits in which they are taking huge risks, like the proverbial picking up pennies in front of a steamroller
Does anybody knows when is the
OFHEO report http://www.ofheo.gov
coming out for 1q 2007 ??
Also:
What do you think of their method of combining refinancing and actual home sales to determine appreciation rate??
From Marketwatch:
U.S. April retail sales down 0.2%, biggest drop since Sept.
U.S. retail sales fell a worse-than-expected 0.2% in April, the worst showing in seven months, the Commerce Department estimated Friday. The weakness in sales spilled beyond home products to include clothing, sporting goods and restaurants. Department store sales and auto sales were also weak. The consensus forecast of Wall Street economists was for retail sales to rise 0.3%. Excluding autos, sales were flat. Wall Street had expected a increase of 0.3%. Excluding gasoline, sales fell 0.4%.
James Bednar Says:
May 11th, 2007 at 7:21 am
Roubini versus Cowen in the “Debate Room”:
Stop Fleecing Poor Americans
I want video……
From MarketWatch:
PPI rises 0.7% on energy, but the core is flat
Higher energy prices pushed up wholesale prices by 0.7% in April, but core inflation was tame again, the Labor Department reported Friday. The producer price index for finished goods rose 0.7% in April, driven by a 3.4% increase in energy prices. Wholesale gasoline prices rose 8.2%. Outside of energy, however, price gains were more moderate. Food prices rose 0.4%, the smallest gain in four months. Excluding both food and energy goods, wholesale prices for finished goods were unchanged in April. The 0.7% gain in overall inflation was larger than the 0.5% expected by economists surveyed by MarketWatch, but the flat reading on the core rate came in below the 0.2% gain expected.
Al,
May 31st.
jb
From the Bucks County Courier Times:
Orleans revenues fall 38%
More evidence of a continued housing market slump arrived Thursday morning, when Bensalem-based Orleans Homebuilders Inc. reported a loss of $51.9 million for the quarter ending March 31.
Revenue fell 38 percent from $207.8 million in last year’s third quarter to $128.9 million for the third quarter of the 2007 fiscal year. The news came just one day after Horsham’s Toll Brothers Inc. announced it would miss its 2007 projections.
During a morning conference call, CEO Jeffrey P. Orleans said the market, despite having shown signs of improvement in February, remains weak.
“Although we did experience some strengthening in new orders through February, March did fall short of our expectations and the trend has continued into April, where our new orders were also disappointing,” Orleans said.
The much more interesting S&P Case Shiller Q1 price index will be released on May 29th.
Clot/KL,
Would you be so kind as to share the information provided?
(From the HB Blog)
60 Minutes: ‘Be glad that it’s Mother’s Day,’ says NAR
Word is out that the much-anticipated 60 Minutes segment on the real estate industry will air this Sunday night and the shrewd PR team at the National Association of Realtors has already been out doing damage control. A letter from the national trade group to its smaller associations has been circulating, giving some talking points on how to handle media and member inquiries about the issues raised in the segment.
Among the talking points NAR suggests: Realtor associations support all business models and favor none; real estate is a highly competitive business with one in 86 adults now a Realtor; there is no such thing as a “standard commission.”
The letter notes: “Bottom line is that we don’t expect that the segment will make Realtors happy but it could have been much, much worse. Be glad that it’s Mother’s Day and the show will probably draw fewer than its average 14 million viewers.”
Chi was right about the dead cat bounce in Jan-Feb. I imagine there will be a few more going forward. Don’t be fooled. The internals of this market are weakening much more rapidly than I had anticipated. If the economy continues to weaken, the best of both worlds will be gift wrapped to the LOD’s, who have a DP and are prime borrowers. Falling prices and lower rates.
From CBS 60 Minutes:
This Sunday On 60 Minutes
6% – Realtors’ sacrosanct commission rate of 6 percent may be in jeopardy due to emerging online competition from Internet real estate sellers and buyers. Lesley Stahl reports. Richard Bonin is the producer.
Chi was right about the dead cat bounce in Jan-Feb
The bounce is over, I’ll post the YOY contracts data a little later in the day. The bounce in contracts came in strong in January and faded throughout the first quarter. April ’07 contracts are running lower than ’06. One can only assume cancellations and BOM are running hotter than last year as well, so sales will come in under ’06 levels.
One can probably argue that we’ve already seen the spring market, it came fast and early in January, but has since faded.
jb
So all the money in RE ran to the Stock Market?
R Patric,
may be so. according to this according article atleast.
http://www.npr.org/templates/story/story.php?storyId=10118251
“The bounce is over”
JB,
I don’t know if that was a bounce or a hiccup. Akin to someone lying flat on their back and attempting to sit up. The attempt failed.
“So all the money in RE ran to the Stock Market?”
MEW’s- Flat screens and Hummer’s. MEW’s are close to being a non-event for consumer spending. One leg has been chopped. Now it’s cc time. If job “growth” continues on the same track, the 2nd leg will be chopped. Great time to be renting. I wonder how many “homeowners” are wannabe renters?
James
I never sign on to njar, I just tried and had to use the forgot password option, it takes them 4 hours to send??? What’s up with that?
Anyhow – I’ll look for your answer.
KL
There was some sales activity in the unusually mild January that carried over into February. That little flurry seems to be fading fast, according to statistics provided here. I think these sales cannibalized or pre-empted the traditional spring market, which we would be seeing pick up now. Instead, according to various accounts (Clot included) the market looks as if it may be starting another leg down.
Failed rally attempt is as good a handle as any.
Here is the YOY YTD contracts data for North Jersey (via GSMLS). FYI, this excludes Hudson and adds Hunterdon.
https://njrereport.com/files/contracts.xls
jb
It’s worth spending some quality time with that spreadsheet.
jb
New Jersey gets an “F”
When asked to “grade” the different markets across the nation, Toll responded:
“In our northern territories, Massachusetts and Rhode Island are ‘F’. Connecticut is a ‘B+’. New York exurbs are ‘B+’, New York urban which for us is Queens, Brooklyn and Manhattan are a ‘B+’ if not an ‘A’. Jersey City and Hoboken are a ‘B+’. New Jersey suburbs, oddly enough when you juxtapose them against the New York suburbs … you got an ‘F’, it may be due to the tax situation in New Jersey, Michigan is an ‘F’. Chicago is surprisingly still and ‘F’ market. Minnesota is a ‘C-‘ market which is a whole lot better than it was. The Philadelphia suburbs is a ‘B’ market for us. The Poconos is an ‘F’ market. The state of Delaware is a ‘C+’ market. The mid-Maryland shore, as I said earlier, is an ‘F’ market. Washington DC, northern Virginia is probably a ‘D+’ market. Raleigh is a ‘B’ market. Charlotte is a ‘B’ market. South Carolina is a ‘D’ market as in dog. Florida, central market, Orlando, we sell a lot of homes, we get the same homes back, we sell the same homes, we get the same homes back, it’s a very hard market to figure. People, I guess are renting them without ever moving in. That’s and ‘F’ market. Florida east coast is an ‘F+’ market. Florida north, Jacksonville, pretty much an ‘F+’ market. Tampa is an ‘F’. Florida on the west coast is an ‘F’. Texas is good, Austin is a ‘B’ market, Dallas and San Antonio, we’ve got a ‘C’ market because we haven’t got our product up and running as we should yet so it’s only a ‘C’ market. I suspect it’s really a ‘B’. Northern California averages to be a ‘C’ market for us, there are some pockets that are ‘B’ and some that are ‘D’. California southern market is a ‘C’ market for us. California Palm Springs is a ‘C’ market for us. Arizona … I would rate as a ‘D-‘. Vegas is definitely an ‘F’. Reno is an ‘F’. Colorado is a ‘C’.”
Lisooh called crash when inventory hits 37,000.
I call crash at 12 months of inventory overall all inventory. I seem to recall the last time JB posted NJAR data that high end inventory was pushing 24+ months in several counties.
Clot, I know you would not be a happy camper if this comes to pass? But, what do you think are the chances.
I think these sales cannibalized or pre-empted the traditional spring market
I think the late winter rally was due to several factors, nice January weather among them.
You had a group of motivated and realistic sellers who knew spring was going to be a flop and were motivated to sell before the spring tsunami of inventory hit the market. They did what it took to sell.
You also had a group of buyers (falling knife catchers) who saw the winter market as a good deal. WOW! Houses 5% off!
Add to this a mini-sense of urgency among some buyers to get in before easy subprime financing disappeared, and you have the makings of a suckers rally.
Here is a link to the NAR “60 Minutes” press release..
https://njrereport.com/files/60minutes.pdf
jb
JB
It’s worth spending some quality time with that spreadsheet.
The beauty of that line is, I don’t think you intended that to be funny, but it is.
KL
Let me tell you, that press release has a very cartelesque feel to it.
jb
Looks like Bergen had a strong Q1. +25.4% which leaves their contracts ahead YTD. The remaining counties in the XL file are flat to down.
This is a file I for one can really cuddle up with.
#32, good analysis. I concur on all points.
JB #28, I so wish we had Middlesex county (mls) included :(
Is there here anyone with middlesex mls access?
Tim #30, do you happen to have a link to that story? Thanks!
Keep in mind that GSMLS is *NOT* the primary MLS system used for Bergen County, NJMLS is.
jb
… one in 86 adults now a Realtwhore… wow!
I wonder how many real estate agents in 2007 were day traders in 1999…
jb
JB, is all of middlesex county in middlesex mls?
In the towns I follow in Bergen County, inventory is increasing. There was a flurry of activity in mid March into the begining of April.
About 12 or so went UC, so far 5 of those are now BOM,and in the meantime inventory is continuing to increase.
Middlesex has enough exposure in GSMLS that I could probably include it in the contracts spreadsheet.
April 2007
Active Inventory – 1261
Contracts – 113
Sold – 102
Hi all,
I’m looking to spend some of the $ from my HELOC on a nice dinner with the lady in Princeton tonight… any suggestions?
Lincoln
“I wonder how many real estate agents in 2007 were day traders in 1999…”
I know many failed day traders that went into the mortgage business. The same old bucket shop mentality, just a different sign outside. Now, they are all trying to get back into securities, futures, fx, etc…
Contracts spreadsheet has been updated to include Middlesex.
https://njrereport.com/files/contracts.xls
jb
From the Washington Post:
Edwards Says He Didn’t Know About Subprime Push
The hedge fund that employed John Edwards markedly expanded its subprime lending business while he worked there, becoming a major player in the high-risk mortgage sector Edwards has pilloried in his presidential campaign.
Edwards said yesterday that he was unaware of the push by the firm, Fortress Investment Group, into subprime lending and that he wishes he had asked more questions before taking the job. The former senator from North Carolina said he had asked Fortress officials whether it was involved in predatory lending practices before taking the job in 2005 and was assured it was not.
…
Last month, Edwards announced a plan to fight predatory lending. He said that an increase in subprime loans and predatory mortgages was resulting in a surge of foreclosures that risked “devastating communities,” and that “shameful lending practices . . . are compromising our strength as a nation.”
James Bednar Says:
May 11th, 2007 at 8:56 am
Chi was right about the dead cat bounce in Jan-Feb
The bounce is over, I’ll post the YOY contracts data a little later in the day. The bounce in contracts came in strong in January and faded throughout the first quarter. April ‘07 contracts are running lower than ‘06. One can only assume cancellations and BOM are running hotter than last year as well, so sales will come in under ‘06 levels.
One can probably argue that we’ve already seen the spring market, it came fast and early in January, but has since faded.jb
Y’all: I was right, but SO WAS CLOT, and clot had skin in the game, and he was advising his clients to get while the getting was good. I’ll take a bow, but clot made people money – worth the 6% in my book. People were lucky to have used him. YES MY LOD BRETHEREN – I STAND BEFORE YOU
JB,
Data in your inbox.
Rich
the market man…….”….don’t try to step in front of a moving train….”
Thanks JB!
#49 Chifin: Actually Clot changed my view of realtors, well I should say at least one Realtor.
Grant it I have not met a capable non-clueless one yet, but they are out there. Just have to look really hard I guess;he knows his business, he adds value. He will be around when many others fall by the way side.
About 2-3 months back, I was mentioning about a few people I know who were refusing job offers elsewhere because they could not sell in NJ because of buying in 2005-06.
In CBS MarketWatch, there is an article today on this issue.
Moving a mountain
Cooling housing markets make job candidates reluctant to relocate
Convincing job candidates to relocate can be a challenge even when the housing market is strong. But with homes in many markets around the country taking longer to sell and prices either flat or declining, employees being asked to relocate are starting to balk in greater numbers.
marcal deal:
if the state did not do the deal. the
mexicans would have burned the place to
the ground.
the state folded like a cheap suit.
heres a company that ran itself into
the ground and they get bailed out.
who’s next.
The spreadsheet has again been updated. It now includes NJMLS Bergen data in a second tab. While Bergen looked very strong based on the smaller-volume GSMLS data, NJMLS shows a much more realistic picture.
Cuddle up.
https://njrereport.com/files/contracts.xls
jb
Realize there is some overlap of listings between the two MLS systems, so we can’t simply sum the NJMLS and GSMLS figures.
jb
Cuddle up.
Now I know you meant that one!
KL
Market up today, on renewed hopes of a Fed rate cut, to get consumers to buy more crap that they do not need;what a country.
Yanni: did you see the article I posted about investing in China from Modern Finance?
Good work, JB, thanks for the revision. Adding in NJMLS to the Bergen contracts tempers the outperformance a good deal. Discounting the overlap, which can only be guessed at, the true figure is probably closer to 5% YTD than 14%.
What kind of world superpower has 1 in 86 citizens working as realtors? That is one scary statistic.
Not that college graduation season is here, I’m wondering how many graduates are planning to stick around New Jersey and how many are going to get out of NJ before they get settled into a job and family. I’ll bet most are going back with mom & dad, but I have to wonder if a higher than usual number are leaving the state. Anyone know anyone graduating this year?
Just as an FYI:
For units Under Contract in Bergen under NJMLS, were down 18% for the first quarter of 2006 compared to 2005.
1 in 86 adults are working as realtors.
OMG, I’m both astonished and amused.
Keep in mind that 1 in 86 stat refers to Realtors ™, not real estate agents.
I am a real estate agent, but am not included in that statistic because I refuse to join the Realtors ™.
jb
Renting #62, I know one student like that.
He’s been living with his parents while going to college here. Decided to go to vet school in Florida and the whole family is moving. They put their house up for sale and bought a condo in Florida (they thought they are getting a good deal, ‘cuz they compare everything to NJ prices). He is not the brightest kid, although I cannot comment on his parents.
On another note, I saw one SFH house yesterday being sold by the original owners. Listed at 549K when a very similar house on the same street sold for 470K in Feb 07. When I mentioned this to the listing agent (I will not be using a buyers agent) he calmly said “Yea, I know it is overpriced. If you are interested we can talk about the price” !!!
I wish I had Booya’s contacts to give him!
From Reuters:
Study warns of debt by low-income consumers
While many low-income U.S. consumers were routinely denied credit a generation ago, these same people now have easy access to debt as demonstrated by the current subprime mortgage crisis, according to a study released on Friday from a Washington think tank.
“Where forty years ago lenders were being accused of ‘redlining’ lower income markets, now they are awash in credit,” said Matt Fellowes of the Brookings Institution.
Increased delinquencies and foreclosures among subprime borrowers with damaged credit illustrate the problem, he said in a statement Friday.
…
The study, which draws on regulator data and credit rating reports, finds that about a third of lower income borrowers falls behind on bill payments in a typical year and a quarter pays more than 40 percent of their income every year on debt payments, including mortgage payments.
Is it worth pursuing a purchase of a foreclosed home?
Foreclosure bargain-hunting
NEW YORK (CNNMoney.com) —
Rising foreclosures will bring misery to many home owners – but bargain prices for some lucky home buyers.
Auction sales of foreclosed properties are yielding extraordinary buying opportunities.Most of the properties have already gone through the entire foreclosure process. First banks took them back from borrowers who fell behind on payments. Then, they then put them through public foreclosure auctions (often held on county courthouse steps) where the homes failed to sell. The banks then cleared any title issues and put them back on the market through a traditional real estate broker.
http://money.cnn.com/2007/05/09/real_estate/foreclsoures_yield_buying_opportunities/index.htm
Even though I wouldn’t apply this to a ‘spring’ purchase, there are helpful tips in general in this article for buying a home, like what to look for in an inspector, attorney and appraiser…
Spring home-buying guide: 6 ways to do it right
http://money.cnn.com/galleries/2007/real_estate/0705/gallery.six_ways_buy_right/index.html
Chifi, thanks for that gem of an article.
There is a similarity between the adrenaline rush the current retail Chinese investors have over their stock market euphoria, and what was witnessed in the Indian stock market back in 99-01 before the Nasdaq popped. The lax margin requirements allowed people to leverage 10-20 times; daily volume and turnover were mind-boggling. I am not sure how strict the Chinese government is as far as regulations are, but when the going is good, nobody cares. The 9% sell off in February will seem like a walk in the park, when the music stops.
Eventually, it will be time to pay the piper.
Quality from Pete Vescey of the NY POST
How uncomfortable is it going to be when the NBA presents Dirk Nowitzki its MVP award?
“If David Stern is as smart as advertised,” column contributor Gregg Siegel allows, “he’ll sign a promotional deal with Southwest Airlines and turn the whole event into one of those ‘Want to get away’ ads.”
JB,
Since Bergen is the highest priced county, do you think it is the last to feel the effects of the plankton theory? Not sure why else it would be “a little different here”.
Thanks,
Jersey4Life
dreamtheaterr Says:
May 11th, 2007 at 12:35 pm
Yan: what is your take on India’s stock market? My skinny – the story is right, but the valuation is wrong – wait for capitulation and dive in hands and feet
#63 RichL: How about 06 vs 07, first quarter?
Hey kids, can anybody give me some info on this one? –> MLS ID# 2345277
It was on the market forever. The roof was shot and who knows what else. Way, way over-priced. It’s know supposedly under contract.
Also – Schwab is hard charging – HARD – with their “DFA knockoff” Fundamental Index funds. There are obviously going to be others out there soon, otherwise, Schwab wouldn’t be so manic about it. I like this concept even better than the equal-weighted stuff, because even the equal-weights stuff you pockets with many bad companies and bad managements.
BBB #74
It’s in the second tab of JB’s spreadsheet, up 4%
Rich
From Bloomberg:
Bear Stearns Funds to Transfer Subprime-Mortgage Risk With IPO
The initial public offering of Everquest Financial Ltd. would allow funds run by Bear Stearns Cos. and Stone Tower Capital LLC to transfer risk from subprime mortgage bonds and buyout loans to other investors.
Everquest, created in September, got most of its $555 million in initial assets from Bear Stearns-managed funds, which held a 67 percent stake in the company as of Dec. 31, according to a Securities and Exchange Commission filing on May 9. Everquest primarily invests in high-risk, unrated “equity” pieces of collateralized debt obligations.
Assets held by CDOs, which package loans, bonds and derivatives into new securities, may have lost $18 billion to $25 billion of value industrywide as mortgage delinquencies rose, according to an April 16 Lehman Brothers Holdings Inc. report. Subprime mortgage bond yield premiums have fallen since, according to RBS Greenwich Capital and Credit Suisse Group.
…
such an IPO, stock investors will be relying on securities firms to come up with prices for hard-to-value assets they’re selling, said Janet Tavakoli, president of Tavakoli Structured Finance Inc., a Chicago-based consulting firm. “The moral hazard in that is just mind-boggling.”
…
It’s “curious” that a surge in subprime mortgage defaults hasn’t resulted in a wave of disclosures of losses by CDO equity holders, Tavakoli said. The default rate for subprime loans packaged into securities is at the highest since at least 1997, according to Friedman Billings Ramsey Group.
sorry for the off-topic, but i’d like some insights from the pro’s on this site.
is there a way to negotiate the 20% down for a co-op?
thanks.
#&& Rich: Then for Bergen it looks like all the activity was in the first quarter, early Spring market, now waning.
http://money.cnn.com/2007/04/09/real_estate/forecast.moneymag/index.htm#table
Forecast: 100 biggest markets
Analysts still are looking for a relatively mild downturn – but in some areas, things will get worse before they get better
Metro Area Home Price(median) Median Mortgage
(% of income) Price change (5 years) Worst one-year decline
Newark $397,000 27 71.5 -7.4 89-’90 -2.4%
Edison, N.J. $362,000 24 76.3 -7.3 89-’90 -3.2%
Nassau/Suffolk, N.Y. $483,000 31 76.3 -6.6 89-’90 -6%
bbb,
First month of the first quarter. January came in very strong. Should we attribute that strength to better affordability and market stabilization? Or just blame it on the good weather?
jb
Al,
Historic price declines? What are you talking about. Real estate prices never go down.
jb
Usury is a social poison as old as alcoholism or gambling.
All of you ‘no regulation’ people need to realize that it just doesn’t work.
http://en.wikipedia.org/wiki/Usury
“They need to pay a doctor’s bill, move into a new house, or buy an engagement ring.”
We have a real problem separating ‘needs’ from ‘wants’, don’t we?
“The initial public offering of Everquest Financial Ltd. would allow funds run by Bear Stearns Cos. and Stone Tower Capital LLC to transfer risk from subprime mortgage bonds and buyout loans to other investors.”
[78],
We thought we transferred/hedged all the risk. Now we don’t want the crap, let’s market a new ipo. There’s bound to be a bunch of dummies, still chasing yield, lining up for this. Not only do we get rid of the junk, we also earn gigantic fees in the process.
You gotta love this.
“Edison, N.J. $362,000 24 76.3 -7.3 89-’90 -3.2%”
Al,
Does this include Union County?
BC,
The Edison MSA includes Middlesex, Monmouth, Ocean, and Somerset counties.
http://en.wikipedia.org/wiki/Metropolitan_Statistical_Areas_of_New_Jersey
jb
The Newark MSA contains Union.
jb
#83 JB: You need to clarify that statement. Real estate prices never go down in Westfield (Brigadoon).
Started a new post right below this one for the Fiserv forecast.
Biggest gainers – and losers
Growth forecast is for April 2007 – April 2008 from Fiserv Lending Solutions.
Allentown, Pa. -0.7%
Camden, N.J. -0.3%
(Burlington, Camden, Gloucester counties)
Edison, N.J. -3.2%
(Middlesex, Monmouth, Ocean, Somserset counties)
Nassau/Suffolk, N.Y. -6%
Newark -2.4%
(Essex, Hunterdon, Morris, Sussex, Union counties)
New York City -3.9%
(If this is the NY/White Plains/Wayne MSAD, includes Bergen, Hudson, Passaic counties)
Philadelphia -0.6%.
#82 JB: I think we atttribute it to what others here have already said.
Some sellers got ahead of the rush, and cut prices, some buyers saw these cuts as getting a good deal, and became the last over the cliff, and January’s weather was decent;buyers felt Springy!
Chifi, I’ve been an outsider to the Indian markets for almost 6 years now so I could be be a bit out of touch with reality. But here’s my take….
There have been fundamental changes to the Indian economy in the past few years, and there is no doubt its people have benefited. But when 300 million people still don’t get more than 1 full meal a day, that is a huge social problem. The opening up of the economy (jobs) and foreign investment is creating a burgeoning middle class of 200-300 million people with a fair amount of purchasing power. As a culture, Indians save a fair amount of their income (perhaps less these days). And buy gold!
The stock market (measured by the BSE Sensex) have had a tremendous run the past five years. Mid-cap and small caps have appreciated even more. The bursting of the Nasdaq was painful for Indian equities in general for 00-01, but the Sensex has tripled since then. Valuation wise, I feel it is now priced for perfection at sub 14,000 levels, and it has me a bit worried.
FII (foreign institutional investors) inflows into India have been the single biggest sentiment-indicator since the early 90’s when the Indian economy opened up, and not much has changed in the psyche of the retail and institutional investors in India. They follow these figures very closely. So future foreign inflows will continue to determine how well the markets do. Any global hiccup and these inflows can turn into redemptions overnight. I’ve been witness to sudden outflows very closely, primarily due to political instability.
I was in equity research from 96-01, primarily in the commodities side. I came to the US in 01, and my boss (a very smart guy) went on to lead Equity Research for the largest private investor in India (the Kerkorian types). I happened to bump into him in the streets in midtown Manhattan (what a small world!) in late 2003 during lunch hour. We talked briefly for 5 minutes since he was late for an appointment and I asked him what he thought of the Indian market going forward, and he mentioned “The Indian markets are in the initial stages of a secular bull run that should run another 4-5 years”. We’re in 2007 now, but considering the sharp run-up, I wonder how much steam is left. He also remarked “The $2 billion a day coke trip the US is on (referring to the deficit) is going will have repurcussions for the US. But it’s good for India since a devalued dollar will make the emerging markets much more attractive to US investors than historically.” Tax treatment of 10% for short-term gains and 0% for long term gains for Indian stocks (maybe it’s changed) also helps.
Personally, I have not added to my stock purchases in India since 03. They have seen ridiculous appreciation since then, but as a percentage of my portfolio, it remains quite low. It is overweight compared as part of my emerging markets allocation.
There is an iPath MSCI India Index ETN India ETN (ticker INP) available to US investors. I would wait for a decent correction before dipping my toes in.
Usual disclaimer applies.
So what’s the deal on DFA funds?
Those analysts seem optimistic to say the least. In my own little world that I follow,I am seeing price declines as much as I can follow (without njmls access) already of 5 to 10%off of 05/06 highs.
And the selling environment continues to decline.
My POS Cape at 20% off is getting closer every day.
Time to put on the old editor’s hat again.
Re post 7
As the number of people falling behind on their mortgages has soared, so too has the number of schemes that cost homeowners their houses.
While it would be nice to think of schemers as the reason people are losing their houses, that’s not reality.
The people who are losing, or are about to lose their houses, by and large are people who have either reached beyond their grasp, were scammed already, or are scammers themselves.
There may be some people who get victimized a second time, but by and large the foreclosures and home losses that are coming were set up long before some shysters got word about granny being behind on the mortgage.
From the Charlotte Observer:
LendingTree laying off 20% of workforce
In the latest fallout from the slumping mortgage industry, Charlotte-based LendingTree on Friday laid off about 20 percent of its workforce nationwide, a loss of about 440 jobs.
A company spokeswoman said the cuts — LendingTree’s first layoff — would be distributed evenly across locations in Charlotte; Jacksonville, Fla.; and Irvine, Calif. That would equate to about 130 of 650 jobs in its headquarters city.
LendingTree’s best known service is a Web site that matches borrowers with competing offers from lenders. With the housing market in a slump, the company is making less money helping banks close loans.
“Our decision today was a proactive one that we felt we simply had to make to adapt to the realities of the current market,” spokeswoman Rebecca Anderson said.
The Mortgage Bankers Association expects loan originations to decline about 9 percent in 2007 to $2.55 trillion as sales slow in a sluggish housing market. Rising defaults in the subprime market — loans made to borrowers with spotty credit — is also squeezing the business.
Grim (6)-
Typical Roubini: the government knows best…please protect us from ourselves.
Look at any problem in our country that our gubmint tries to address. The only consistent outcome is that they make it worse. The gubmint NEVER does the right thing. Please God, let them stay out of the lending business.
For proof of my #97 statement, look no further than #9.
lincoln78 I’ve never eaten here, but heard it’s good:
http://www.tripadvisor.com/Restaurant_Review-g46756-d513535-Reviews-Mediterra_Restaurant-Princeton_New_Jersey.html
From Bloomberg:
U.S. First-Quarter Growth Estimates Drop on Trade, Inventory
U.S. economic growth last quarter, already reported as the slowest in four years, will probably be revised even lower after figures this week showed a wider trade gap and a drop in inventories.
The U.S. trade deficit in March jumped 10 percent to $63.9 billion, the widest since September, the Commerce Department reported yesterday. Stockpiles in March unexpectedly fell by the most since July 2005, Commerce reported today. Higher sales in March and February kept estimates from falling even more.
Economists now forecast first-quarter growth, reported last month at a 1.3 percent annual rate, may actually have been as low as 0.5 percent. Still, leaner inventories and stronger demand in March brighten the growth outlook for this quarter, economists said.
“The reports this week probably translate into first- quarter GDP of at least half a point lower,” said Joshua Shapiro, chief economist at Maria Fiorini Ramirez Inc. in New York. “It does set the stage for a better second quarter though, so it’s not all bad news.”
Grim (18)-
I’ve seen nothing. This letter most likely went to HSAR and other county/regional Realtor associations.
I’d buy copies of the whole show if it features Mike Wallace doing an “ambush interview” on Lereah.
Grim (20)-
Just from that alone, I can tell the whole 60 Minutes piece is a joke.
God, that show has turned into a POS.
Hawk (31)-
I hope the damned thing hits 40K/12 months-plus supply of inventory.
My philosophy then: shoot ’em all, and let God sort ’em out later. A vast majority of those sellers will be complete capitulations at that point. That means sales volume!
ChiFi (71)-
D’ya think Dirk will even show up to take it in person?
What a disaster for the NBA.
JB,
I thin I sen the dater ya’ll were lookin’ fer.
We are selling our house. Have to move to different town due to job and kid’s education. My wife want to buy a house in that town if she see a “right” house. I am thinking of renting for 1/2 to 1 year. She is afraid that the price will stay the same or even higher, then it doesn’t worth living in a rental place.
I still think the price will come down further. Of course, nobody has a crystal ball. But would any one of you give me your guess-timation on how much it will go down by spring 2008.
007,
You’re trying to time the market. Hard to do. You’re already in transition, attempting to sell your house now. You might want to rent short-term to make sure you close and not get caught with a bridge loan. OTW, if you find the right house, once you sell, why not buy now? Saves you a move to and from a rental.
2008 might offer some opportunities but there are a few out there now for an informed buyer. If you plan to stay five years or more in the house, whatever you save between this spring and next won’t amount to all that much over the life of the loan.
007
No crystal ball, but I say they aint going higher so why not rent and see what happens
KL
WSJ
COMMENT FROM BREAKINGVIEWS
May 11, 2007; Page C14
Stupid Bankers
Bank of America CEO Ken Lewis believes “we are close to a time when we’ll look back and say we did some stupid things.” Considering the flood of loans going to leveraged buyouts, that is a pretty safe call. However, the bankers writing blank checks to private equity find it difficult to resist the fees. Risks clearly are piling up for those who lend to buyouts. Debt levels have been rising and many loans come with fewer of the normal protection covenants provided to creditors.
The finance for Sam Zell’s takeover of media group Tribune Co. demonstrates the dangers. Bank of America is among the consortium providing more than $11 billion of loans for the buyout. After the refinancing, Tribune’s debt will be equivalent to roughly eight times the company’s cash flow, according to S&P Leveraged Commentary & Data. Given doubts about newspaper industry’s prospects, that looks pretty heady.
The banks that lend to buyouts get to pick up fees of roughly 2% of the value of each deal. They seek to get these loans off their books as quickly as possible. In the current deal-making frenzy, banks have been forced to extend the length of their exposure. More than $4 billion of the Tribune’s loans are future commitments, including a $2 billion “bridge” loan. One of the biggest fears among bankers today is that if the market sentiment changes abruptly, they could end up “wearing the paper.”
In order to return “sanity” to the lending world, Mr. Lewis believes, “we need a deal to go bad, as long as we’re not in it.”
That may be wishful thinking. In the past 12 months, Bank of America was the second-largest provider of leveraged loans globally, according to Dealogic. It is one thing to warn about stupidities in buyout lending, but it won’t be easy for major players to escape the fallout.
Jase Rion–re: 20% down on a coop
I can’t see that it would be negotiable. The coop Board would have to approve it, and, since they’re also be going to be evaluating your financial ability to pay the maintenance (and your mortgage) every month, they probably won’t want to lower that standard.
Of course, it never hurts to try, I suppose.
First time blogger…love the reads on njreport even though I live in Mercer County. I am in the market for a house, sold in Feb 06 and renting right now. Interesting that all the talk is about the “historic drops” in sales and home prices, yet homes are still too high. A great fall from the highest peak is still painful, and unaffordable. I remember an article stating how juvenille crime was down record percentages. They don’t tell you that the 14% drop was off an all time high of a 300% increase. Still way too high. Anyone see that fast food is now being measured in manufacturing numbers? They stamp out their own burgers so they qualify…a very creative play.
dreamtheaterr Says:
May 11th, 2007 at 1:41 pm
Thank you.
THESE ARE YOU POINTS THAT STOCK WITH ME
Any global hiccup and these inflows can turn into redemptions overnight. I’ve been witness to sudden outflows very closely, primarily due to political instability.
FOR NOW, I AM USING MY “BACKDOOR” FOR EXPOSURE [Global US]
But it’s good for India since a devalued dollar will make the emerging markets much more attractive to US investors than historically.”
I SEE WE AGREE
I would wait for a decent correction before dipping my toes in.
Usual disclaimer applies.
======
Please allow me to add that of all the emerging markets, South Korean and India strike me as having the greatest potential to morph into markets with Western style and rigor. Their foreign nationals on the street and ethnic U.S. citizens are of equivalent caliber and potential. Potential, in the sense that I exclude most others who are around merely for their country specific knowledge and language skills, and even the Japanese, who are hopelessly xenophobic and culturally elitest.
THESE ARE YOUR POINTS THAT STICK WITH ME
jeez :(
007:
If the price stays the same, renting could be cheaper. The only way buying makes financial sense in this market is if the home price is appreciating give you some of your interest payments back as accrued capital appreciation.
Ofcourse I will loose the emotional argument to the trolls/richards on this forum. Nice deck, pride of ownerhip (on a 100% mortage) etc, etc. Then again, I have tried to make all major financial decisions unemotionally.
#111,
Anyone see that fast food is now being measured in manufacturing numbers? They stamp out their own burgers so they qualify…a very creative play.
I first heard about a lobby to get fast food into manufacturing a couple of years ago and I thought it was rediculous. I never thought it passed though.
Anyone have a link to the source that this is now official?
#114 Anti-Trump: Agree on all points, yes the emotional aapsect is an issue,but to buy in this market now is just insane.
The trolls can harp on about the emotional issues, and how appreciation etc is only one small aspect of home ownership.
But I do not care who you are, I gurantee that if you buy a house at the least you would want to be able to say at your family gathering/friends barbecue, “well if we had to sell now, we would at least break even”.
Well that is not the case now. All the painting, fabric swatching, gardening, and barbecuing in the world will not change that.
Nobody wants to buy a house and then find out that it is not only not appreciating, but is losing money;it ain’t a nice feeling.
“A vast majority of those sellers will be complete capitulations at that point”
Clot,
Please do call this LOD member when this occurs.
Which of the below?
1) Fall/winter- 2007-2008
2) Fall/Winter- 2008-2009
jb:
is there any way, when you have some free time, for you to put a speadsheet or link together showing addresses and sale prices for homes in Nutley over the past 3-4 months?
I would be forever grateful.
To RentLOrd..
http://www.cbsnews.com/stories/2004/02/20/politics/main601336.shtml
#111 House Hunter: Give it time, we are less than a year into this thing, and the decline is only really starting to rev up now, much more to go.
This time next year and I think the landscape if you will, will be completely changed as far as prices.
For those of you yearning for homeownership so that you too may savor the taste of your back-yard grilled steak, I say think of the steak.
Throwing that tasty flesh onto your propane fired backyard grill is just a terrible thing to do. Again, think of the steak.
Get yourself a flat-iron skillet, and when I say flat I mean flat, none of that silly grill-ridge stuff either. And older is better when it comes to cast iron. Don’t ever wash it either, and no, I’m not kidding. Salt and a stiff brush is all you need once it’s cured. Anyway, back to how to properly savor your steak.
The first step is to get that cast iron skillet hot, real hot. While you are at it, get your oven piping hot too, we’ll need ’em both. Sear the meet quickly on each side. We want to develop a nice brown crust (oh how I love you Louis Maillard!). NOT TOO LONG, we want to develop a crust, not cook the steak.
Once you’ve got that crust, in to the oven it goes. Only a few minutes, we want it cool, red, and bloody in the center.
There you have it, a steak done properly. No silly Viking backyard kitchen required (I really hope that fad dies a quick death).
Oh, seasoning, forgot about that. Salt, pepper, done. No rub, no sauce. Browned butter and garlic a nice compliment.
jb
#107 twice; Between now and next Spring I think there will be a significant difference in price, which would make it well worth his while.
Plus with nothing to sella t that point, he will be in a much stronger negogiating position on the buy side.
Oh, and to add to that JB, treat yourself to a steak from an independently owned butcher. Big difference opposed to typical supermarket steak.
Or just take a trip up to Peter Luger with all the money you save renting.
jb
(I can’t take credit for this one)
What about River Palm Terrace?
Is it any wonder that the real estate market is down? There’s been a conspiratorial push to talk it down over he past two years, so it’s no surprise that market has softened. This is sickening.
Tell you what though, anyone selling should stand their ground and not give anything away. They should not allow themselves to be taken advantage of by these vultures making lowball offers.
I was just talking to someone who was trying to sell is house to someone who was presented as a qualified buyer by a realtor. The guy can’t get a mortgage and my friend is preparing to sue that realtor for not bringing him a qualified buyer after inducing him to move out of his house under the idea that the closing was impending. I don’t blame him. He should sue that damned realtor and keep the earnest money deposit. In the interim, his house is now vacant and he’s having to get insulted by the most low down and dirty group of individuals-the lowball buyer. This group is acting like they’re circling over carion.
It’s time to all sellers to suck it up and not fire until they see the whites of the buyers eyes. Do not give your property away for nothing. Hold the line. These people have to buy at some time. There’s too much pent up demand.
#116, you’re spot on. When people buy a house, they are immediately 7% in the hole due to the costs associated with selling costs, NJ realty tax, etc.
Assume a buyer in today’s market sees their house goes down in value 3% each year for the next 3 years (entirely possible in this current environment), and prices then rebound and keep up with inflation, it will take approx 5 years just to break even in nominal terms! In real terms, assuming inflation running 3% annually, it will take even longer. And you’re stuck paying interest on an inflated (and depreciating asset) in the near term. The risk-reward is just not worth it.
PS – this scenario does not apply to Westfield, where prices are observed through a kaleidoscope.
There’s too much pent up demand.
How do you measure that?
jb
bergenbubbleburst
Thanks for the encouragement, I am moving for the schools so it is worth it for me. I am paying $1800 a month now. Doing comps on homes that have sold around here, the prices have come down 14-28% on some. I Don’t what I will do after I buy, this has become and part time job combing over all sorts of news, comps and frustrations!
The only reason I bring it up again, is because I wrote a few lines on this just the other day:
How does one measure/quantify “pent-up demand”?
The only possible way to measure this, as far as I can imagine it, would be to try to quantify the number of offers made, but not accepted.
Three cases come to mind,
1) Offers rejected due to an offer price lower than sellers will accept.
2) Offers rejected due to higher counteroffers.
3) Offers rescinded by buyers due to a defect in the property.
This concept is basically the same as measuring “phantom demand” or “lost demand”, a concept that is key in catalog and other forms of direct marketing. What it tries to measure is how many people want to buy, but can’t. What we need to quantify is how many real “buyers”, not lookers, there are in the market. Once we have this data, we can compare it to historical periods to determine whether or not we have any “pent-up demand”.
Tell you what though, anyone selling should stand their ground and not give anything away. They should not allow themselves to be taken advantage of by these vultures making lowball offers.
I agree, sellers should stick it to those greedy buyers by RAISING their prices.
jb
reinvestor #126: What about sellers insulting buyers with high prices? Shouldn’t there be a middle ground? Honestly, you can’t expect a house to double in value in only 5 years. That is what is insulting.
The contracts spreadsheet has again been updated to include NJMLS Essex and Passaic contracts
https://njrereport.com/files/contracts.xls
jb
126]
I agree. Sellers must do everything possible to stop the sale of their house.
From Businessweek:
The Everquest IPO: Buyer Beware
Never underestimate the ability of a Wall Street investment firm to find a new way to pawn off some of its balance-sheet risk onto retail investors. The latest example? The initial public offering for Everquest Financial.
Everquest is a fledgling financial-services company that has been buying up risky bonds backed by subprime mortgages from Bear Stearns (BSC)—one of Wall Street’s biggest underwriters of mortgage-backed securities and other exotic mortgage-related bonds. The deal appears to be an unprecedented attempt by a Wall Street house to dump its mortgage bets.
Having a BBQ here on sunday-
Signed
Renter/rhymingrealtor
“It’s time to all sellers to suck it up and not fire until they see the whites of the buyers eyes.”
[126]
You have it *ss backwards. That was 2004/2005. I know, because I was a seller. Zoom to today, advantage to buyers. Funny thing, buyers know it and now sellers are realizing it. The charade and insanity are over. Some things old become new again. Bargains in 2008-2009.
JB
Is your alter-ego Alton Brown?
Oh bother.
RE-Investor,
Is it any wonder that the real estate market is down? There’s been a conspiratorial push to talk it down over he past two years, so it’s no surprise that market has softened. This is sickening.
You’re joking, right?
If not I have a tin-foil hat you can have, free of charge.
Pent up demand? Yeah, at the county court house.
Is it me, or something wrong with this headline on Marketwatch:
Dow surges as data points to U.S. economic slowdown
yea yea.. rate cut speculation.
#126 reinvestor: WOW What power I have, to think I was part of a tiny group who is now bringing the real estate market to its knees. Its now time to start writing poems and ballads about us.
Hey as soon as your friends POS Cape/Colonial is around 20% off of the 05 or so high, let me know and I will buy.
Until then tell your friend to suck it up cream puff.
“This is sickening.”
[126],
The industry is much worse off than this. More like, dire straights.
If anybody has properties stuck up their *ss; sickening, alarming, dreadful and soon outright panic.
reinvestor101,
BOYAAAAAAAA!!!!!!
Mrs. Gary just said, Tough Sh*t pal, you and your friend are assh*les for thinking that the buyers will back down. Econ 101: Something is only worth what someone is willing to PAY for it.
#140 rent: So if the Fed cuts by 25bp in June, prices will probably go up what? like 10%? Time to restart the real estate party.
reinv [126] is absolutley right and sellers are listening.
This is sickening.
Agreed, I am sickened on a daily basis by the NNJ RE market.
…anyone selling should stand their ground and not give anything away. They should not allow themselves to be taken advantage of by these vultures making lowball offers.
Agreed again. I have seen first hand a seller reject five offers, one all in cash, because their 8 months vacant property is “worth” more than is currently being bid. GO THEM!!!! The lost interest/returns on the money they could have sold for by now and the 3 quarters of property taxes they are now responsible for will be chump change once they sell for their asking price. Who cares if its takes a few years?
…he’s having to get insulted by the most low down and dirty group of individuals-the lowball buyer.
It’s borderline obscene, I agree. The buyers willing to pay your friends asking price are undoubtedly on vacation, traveling for business or perhaps stuck under a large piece of furniture. Just wait till they come back and start placing ‘real’ bids at peak prices +5%!
These people have to buy at some time.
Agreed!!! I heard they are running out of rentals (homes and apartments) in all of the ‘Top’ towns. These greedy buyers will be kissing cardboard soon.
ReInvestor #126, always good for a laugh.
Why anyone would want their fellow American families priced out of shelter is beyond me.
But I hope sellers take your advice, and “suck it up” as their mortgages continue to adjust, and inventory continues to climb — on the courthouse steps is where we’ll meet, and I’ll see the whites of their eyes (moist with tears) as irrational greed and hopes of 100% profit rapidly fade from their memory as I take the keys for pennies on the dollar.
JB (#65)-
so, how many real estate agents are there? if 1 in 86 are realtors, are there 1 in 43 are real estate agents?
“vultures making lowball offers”?
How about don’t sell and never die..
ReInvestor #126
Funny stuff. I love “pent up demand”. My pent up demand is bothering me so much I am heading off to St Kitts for a week. Rather have money in the bank and enjoying my life than being a bag holder:)
The housing market reminds me of a steak that’s been left in the refrigerator too long. The longer you wait to eat it, the more unpalatable it becomes as the blood slowly drains out onto the plate below it leaving it unsavory.
Accept the inevitable people, lower your prices and get on with your lives!
Boy it’s a good day to be a renter….
twice shy, rhymingrealtor, Anti Trump,
Thanks for the suggestion. I never “love” my house, but my wife does “love” the dream house. All my calculation are strictly base on $, plus the emotional impact on me from her. :-(
Thanks again.
007
I distinctly remember the feeling in the dot com days. I was working for just-IPO’ed company and everyone around me had stock options up the wazoo. Everyone partied for no reason, bought more fancy cars than they knew why and what not. It was just insane.
When the bubble burst, the vast majority never got it. I remember watching my company stock price going down every day.. but I would tell myself – hey, it will go up again (not to mention upper mgmt giving pep talks all the time). my company stock never went down since it IPO’ed till then. And then it happened… what a bust!
(I have to admit I day dreamed, but never did anything with the paper money.. being younger.. i had other stuff in mind ;-) )
I see the same thing going on now with RE.
It’s hard to explain to sellers if they haven’t experienced the dotcom bust. I am sure some have, but have conveniently forgotten.
“It’s hard to explain to sellers if they haven’t experienced the dotcom bust.”
Rent,
How about the dot bomb crash, the 1988-1992 RE declines/recession [oops, dirty word, hope its not filtered] and the stock market crash of 1987.
Old school. Same mentality, different characters/experts, it’s different this time. Like a vicious cycle, same crap delivered in a different package.
Please be advised that the spring selling season is a disaster..Prices are high…mortgage is cheaper, and there is just enough byers to prolong the misery…
This is not good for someone like myself who is looking for a quick correction, actual overshooting the other way and start making money AGAIN.
This is also not good for the economy as RE affordability is looking to correct itself by keeping prices high and awaiting inflation and income to catch up. This could take up to a decade. EX Japan
and my renters that is a long time to pay rent and barbeque indoors.
#152 007 With all due respect to your wife do nto be forced into doing soemthing, that you are not comfortable doing.
Much better to have her say WOW! you were right, I am glad you conviced me to wait, then have you say I told you so.
These people have to buy at some time.
I’ll bet I can remain in my apartment much longer than a most flippers can carry PITI on a vacant house.
There’s too much pent up demand
Home ownership in near record levels. Everyone who was going to buy is already in. The bubble borrowed future buyers. All you have left are those who are unfit to buy, even with subprime lending, people who will always choose to rent, and people like me who waited this long and are prepared to wait for the right deal at the right time.
DOW will keep going and setting new highes for the next 4-5 years. Everyone I know is back to investing in Business and staying away from RE. Real return on a CD is higher then Real Estate these days.
I think it’s time I start a company. And forget RE for a while.
Does anyone know anything about Propriety Schools I hear Catherine Gibbs is for sale.
#155 Make Money: If you say so grasshopper.
BBB go jump in the lake you ASKHOLE
make,
The Clay Hill auction is next week, are you still planning on bidding?
jb
make money, are you a writer on 30 Rock? Your stuff is just too good.
Catherine Gibbs (sic) ain’t no Miss Porters but if you say its a Propriety School, well then, ok. Will you be taking the money you planned to invest in being a slumlord and place it in the world of “market ready” professional education instead? Do tell.
Who’s barbecuing indoors? My 6-burner stainless sits quite nicely atop my landlord’s 16×20 deck that he pays to powerwash and seal. And oh yeah, guess what’s gonna happen when the market gets flooded with rentals due to lack of home sales?
“This could take up to a decade. EX Japan
and my renters that is a long time to pay rent and barbeque indoors.”
Make,
You may very well be right. Slow, grinding, painful process for owners. My bet, those that are jammed up can’t wait that long. They will capitulate. Great time to sit back, count your cabbage and plot your strategy. Goota love the irrational and moronic.
Make,
You really perk me up when you post. The day is dragging and then bam. Thanks for the enlightment.
#164 BC: There are also peopel out there who bought years ago, and once they finally realize the party truly is over, they will reprice their houses to sell; simple as that.
Then of course the divorces, job transfers etc, life goes on.
From other thread–RentinginNJ Says:
May 11th, 2007 at 8:19 am
I just read an article about how the housing market in parts of North Carolina is taking a hit. This was supposed to be on of the areas more immune from a downturn. Many people are still coming to look, but they can’t sell their NY metro area homes to be able to move.
Can you post where you saw that article? Thanks.
rachel
#160 MM: Ah so young so silly grasshopper, but you will learn, we are here to teach you, your immaturity aside.
157 RentinginNJ
I think the $64K question is:
If most of those that needed to buy already bought, then are there as many desperate flippers as there are patient renters waiting on the sidelines?
“Then of course the divorces, job transfers etc, life goes on.”
bbb,
Good point. How long can those wait, life altering circumstances.
Multiple sellers chasing one prime borrower. Boy, it seems like yesterday it was 6 buyers bidding up one pos.
It’s a brand new day.
Tell you what though, anyone selling should stand their ground and not give anything away. They should not allow themselves to be taken advantage of by these vultures making lowball offers.
Don’t you hate it when the MARKET is out of step with a properly priced property?
reinvestor101 Says:
Unfortunately many of the sellers have the mortgage banks bending them over with an ARM Rest so it’s hard to stare the buyers in the face when your clutching your ankles.
Off – topic
Can someone tell me why google is igoogle?
It’s been bugging me for a week!
Thanks
KL
Thank you James for proving my point in the other thread that you and your website are misleading people. You pulled GSMLS #’s for larger units then what I purchased and stated that those units are selling for 10% less then what the builder is advertising on their website. Your first mistake is that you are comparing a larger unit with my unit. I was comparing the same unit as mine.
Your second mistake is that the people who bought the granville payed less then the 400k SP because they bought preconstruction. I won’t keep beating a dead horse but your DD is not quite up to what everyone here belives it to be. You are wrong.. and if you go to the Belleville Tax Assessors office you will find more proof of your errors.
Oh, and you asked why I felt I needed to prove that I made a good purchase? Because I was following this website up until the time I purchased and actually believed the things that were being said on here. I’m glad I didn’t listen and bought new construction at a good price. Good luck to all who will be waiting it out till 2008-9, 10, 11, 12 or whatever this blog will lead you to believe will be the bottom.
Please explain to me what I have to gain by wasting my time misleading people?
jb
Secondly, I clearly stated that the two comps I posted were the larger 2,020sq/ft Granville units. I even went so far as to break down the price per square foot for comparison purposes.
Let me copy/paste that response here so everyone can read it.
James Bednar Says:
May 10th, 2007 at 4:56 pm
Bought Last Year,
What about this one?
MLS# 2334184 – 808 DeLuca
OLP: $476,335
SP: $356,000
CD: 01/03/2007
The unit you listed above is only 1294 square feet, this unit is the largest style unit available in the complex, listed at 2020 square feet.
As well as:
James Bednar Says:
May 10th, 2007 at 4:59 pm
As well as this:
MLS# 2334184 – 812 DeLuca
OLP: $443,540
SP: $403,000
Also the Granville, 2020 sq. ft model, this one prices out at a few cents under $200 a square.
The developer web site lists the price for the Granville units as starting at $446k. Did they actually sell for that, if so, those buyers are down more than 10% already.
grim: you cad – I smack you!
RentinginNJ Says:
May 11th, 2007 at 4:56 pm
There’s too much pent up demand
Home ownership in near record levels. Everyone who was going to buy is already in. The bubble borrowed future buyers. All you have left are those who are unfit to buy, even with subprime lending, people who will always choose to rent, and people like me who waited this long and are prepared to wait for the right deal at the right time.
Rent: I like the calculus.
Isn’t there some movie [throw mama from the train?] where Danny DeVito says “you lied to me” then he hits someone [Billy Crystal?] over the head with a frying pan?
Well grim…………I WISH I HAD A FRYING PAN!
BUZZZZZZZZZZZZ… “I’m sorry, but the correct answer is, ‘The sellers are in denial’. Johnny, can you tell us what parting gift we have for our contestant?”
“Sure thing, Wink! For our contestants today, we have 10,000 copies of “Why the Real Estate Boom Will Not Bust—And How You Can Profit from It” by David Liareah.
BLY,
You do realize that I’m an active and practicing real estate agent, don’t you?
NJ DOBI Licensee Search
Never once did I ever tell anyone to buy or not buy, my own clients included. I simply present the information so that you can make the most informed decision you can.
No spin, no shills, and no bullsh!t.
I’ve got a day job that pays pretty well, and I don’t need a commission to put food on my table or a roof over my head. That little luxury lets me call the market how I see it, without worrying about how it’s going to affect my bottom line.
jb
bought last year,
I know you are in the very desirable Belleville NJ area (lived in belleville from 99-02) had my car’s windshield bombarded with a log by some hooligans hanging out on an overpass when driving through branchbrook park and on another occasion some lovely folks up in that area tried to steal my friend’s acura)..but I digress….
After reading about your decision to buy at $262/sq ft I decided to do some searching last night. And look what I found…its your builder by the way.
(repost from yesterday)
New construction. Monmouth County.
these are 2 different models but look at the price difference. Same street.
7/06 sq ft 4952 950k
11/06 sq ft 4973 728k
7/06 re-sale
11/06 from builder
looks like they are selling for $141/sq ft down from $191/sq ft.
and the builders aren’t done selling yet…
I know comparing apples to oranges.
I am just saying, maybe something to look into, no?
one more vote for Mediterra in Princeton. I work next door at 47 Hulfish. If it’s too crowded, head to Theresa’s cafe for some amazing Italian. And FWIW Yankee Doodle Tap Room isn’t worth the price of admission.
“My 6-burner stainless sits quite nicely atop my landlord’s 16×20 deck that he pays to powerwash and seal.”
[163],
I’m jealous. However I do have a patio and a built in pool. As a matter of fact, I’m sitting at the pool now planning out the weekend. No spring cleaning/yardwork for me. Tailgate at the Meadowlands tomorrow and then to see the Nots. Brunch with Mom on Sunday. Don’t miss the weekend trips to Home Depot at all.
To all the Moms;
All the best this Sunday and many more to come.
BLY,
I know you got a steal since you have grass in the front and the back. Was that a free incentive? For the zillionth time;
How much down and what type of financing?
Chi,
Best post all week; Rickey and his ball.
Scram kid, this is Rickey’s ball and it’s going on Rickey’s mantle.
Priceless.
Are rental prices posted on mls generally negotiable? I went through craigslist for my current place and was able to negotiate my monthly rent down quite a bit. I was wondering if I can make bids through a realtor much the same way you would if you bought a house.
Rachel,
Can you post where you saw that article? Thanks.
Here is is:
http://www.citizen-times.com/apps/pbcs.dll/article?AID=200770504105
ChiFi (49)-
And you should see the two sellers of mine who DIDN’T take my advice.
Up S**t Creek without a paddle. No one to blame but themselves. I don’t even want the renewal listings when they expire.
I also suspect I’ll be prepping a short sale package on one of them.
burst (53)-
There are good ones out there. You just have to dig really hard and interview like a ba**ard.
dream (70)-
The weird thing about China is, the gov’t is the largest shareholder in the 23 largest companies (by market cap).
How can you say there are any rules at all when the rulemaker is the biggest hog feeding at the trough?
oh BLY,
I forgot to add that the folks who sold the unit for 950k, had bought for 910, with 7% off for transactions fees, they brought 26.5k to the table.
This is no 1989 story folks. This is 11/06.
Pat (99)-
Mediterra is the best resturant in Princeton, IMO. 10x better than Lahiere’s, and less expensive.
BC (117)-
Your choice #1. This thing is picking up steam at a pace far greater than Chinese water torture.
Grim (121)-
Nice to see you’re familiar with the Maillard Reaction, the guiding principle of all fine cookery.
Dink (188)-
Yes, you can.
BC Bob,
What role does my financing have to do with the arguement on whether or not my home is gaining or losing value?
“The weird thing about China is, the gov’t is the largest shareholder in the 23 largest companies (by market cap).”
Clot [192],
They are green with envy pertaining to their counterparts, Temasek Holdings, an investment arm of the Singapore govt and 100% owned by the Ministry of Finance. Temasek has achieved an 18% annual compound return, since their inception. On the flip side, how does Jin Renqing feel about his U.S., 4.6%, 10 year yield in an environment of a sinking dollar? On top of that, there is now evidence that we may not be greasing their wheel as much as we have in the past. What’s their incentive to hold dollars if our buying slows down/dries up?
There is a reson China is diversifying its $1 trillion trade surplus. It has as much to do with Temasek as it does with our dollar. Now, that’s a ton of support if their market starts to crack. A reason to invest? No. However, they will use all their power and $ to hold up their bubble at least until the games are played. There will be lip service along the way, they want air out of their bubble. [at least they recognize the bubble] They will be there to support it if things get out of control. The Chinese PPT, but with a regiment to go to battle field. After the games? Caveat Emptor.
BLY,
Some individuals pay X amount over the lifetime of the loan. Others pay Y amount. Are you an X or an Y? Very important pertaining to whether the asset is sinking or appreciating.
Clot [195],
The fall of 2007, winter of 2008. Wow.
Funny, last year the bulls were tryimng to paint the picture of a no bubble scenario. Fast forward one year, and the discussion is how fast this insanity unravels. Quite a divergence.
I guess the bulls were not painting a Rembrandt.
How about this parabolic move, PRC;
http://www.mof.gov.cn/english/table/11.jpg
Funny, last year the bulls were tryimng to paint the picture of a no bubble scenario. Fast forward one year, and the discussion is how fast this insanity unravels
1. Denial – 2006 – Real estate never goes down. It’s different this time!
2. Anger – early 2007 – The media is over playing this minor subprime situation. Bernanke…do you job and cut rates already! This slowdown has gone on long enough!
3. Bargaining – present – okay, okay…There was a bit of a bubble…I’ll admit it…there is a lot of inventory on the market…and prices may even drop…but only by 1% or so…before recovering next year.
4. Depression???
5. Acceptance???
#175 Belleville?
I kind of look at the Chinese Stock market like the diamond market.
You pay for a diamond. It ostensively appreciates in value [e.g., my wife’s engagement ring purchased in 1998]. However, technically the cartel that controls the market can flood it out any time they want, and the value of you asset becomes asymptotic with zero.
BC Bob Says:
May 11th, 2007 at 7:19 pm
Chi, Best post all week; Rickey and his ball. Scram kid, this is Rickey’s ball and it’s going on Rickey’s mantle. Priceless.
Bost: I don’t why, but I guess the Metsie playing the Brew Crew makes me think of Milwaukee and Rickey makes me think pinstripes. So, I harken back to 1989, and the famous Luis Polonia incident when he was guilty for …ahem… an indiscretion in a Milwaukee hotel with a minor…….
It remind me of two jokes…..
#1 What is Luis Polonia’s policy about field conditions? If there is grass on the field – PLAY BALL
#2 Did you hear about Luis Polonia night at Yankee Stadium? Every girl under 16 gets a free hot dog.
booooya
http://en.wikipedia.org/wiki/Luis_Polonia
#126:
You GO girl (guy?) – you stick it to those presumptuous buyers. Stand your ground!! Pay those taxes, utilities, maintenance and keep that property up to snuff so you get that full price you are looking for, down the road!
Damn carpetbaggers….think that they’ll snap up your ’03 purchase for less than the 220% you are asking for?? Besides you sweated all the way through the closing with your no doc I/O or 1/5 ARM!
You *earned* that damn increase… I’m right with ya baby! You keep those scoundrels at bay. Besides…’08 and ’09 and ’10 are on their way! Hooray for house price increases!! Now we all can really be rich like the guy (girl?) who sold you that house in ’03!!
You GO baby!
Warriors raining threes from everywhere. Better than any college game I’ve seen this year.
In fact, the 5 best basketball games I’ve seen this year were all NBA. Too bad they vote Frankenstein as MVP.
Warriors drop 70 in the 1st half. They rested all their starters, too. This is fun to watch.
BC Bob Says:
May 11th, 2007 at 7:19 pm
Chi, Best post all week; Rickey and his ball.
OK – I accept that, but give credit to the two best originals
sas Says:
May 9th, 2007 at 8:02 pm
“What ever happened to those big Wall Street bonuses that were supposed to save the market this Spring?”
It went up their nose & to call girls. SAS
AND
Read My Lips: How’s the Ramen taste? Says:
May 10th, 2007 at 8:58 am
BOOOOOOOOOOOYAAAAAAAA
Bob
BC (199)-
I remember reading back in March the Chinese govt is setting up an investment company- a la Temasek- to explore other investments that bring a bit more of a return than US Treasuries.
Thank God these guys have no real clue as to how to invest. Getting 4-5% on our debt when they can haul in a rigged-up 40-100% on BIDU, LFC et al is just laughable. It makes me think that their top guys are so awash in graft and kickbacks that they just don’t care about performance. The hogs have been to the trough so many times, they’re both high and sated by the richness of the diet. They’ve got the world in the palms of their hands, and they neither recognize it nor understand that they should concentrate on making hay rather than imprisoning and silencing their population.
ah good steak!
First. You can get a good cast iron skillet at a garage sale for next to nothing. It may look rusted, so what? Clean it fully initially and never again after (like Grim said.)
Season it by coating the whole thing with oil (preferably a high smoke point oil– peanut or grapeseed.) Bake it in the oven at a high temperature 400+ — you can leave it in for an hour or more. Shut oven off and let cool (in the oven is fine.)
Now… let’s talk steak. Heat said skillet on stove — but to get it atomically hot? Put it in the oven at the highest temp your oven does. Leave it in there for 15-20 at high. USE GOOD OVEN MITTS and return to stove (also set to high.)
While skillet is in the oven. PAT the steak dry with a good towel and then with paper towels so it it as dry on the outside as you can get it. You can press kosher salt onto the meat with fresh cracked black pepper to season.
Put steak to pan and let it cook. DO NOT TOUCH, POKE PROD or otherwise molest the meat while it is searing. The time on each side depends on the thickness of the steak. Thinner cooks faster… you get the picture right? If it’s a super thick steak, flip it and then transfer the pan to the oven. You let it cook in the oven but test it by pressing your finger on the meat…. More give- rarer, less give — more well done.
Remove from oven – using tongs lift steak from pan and set on top of an upside down pyrex custard cup set on a plate.
Let the meat rest. Even 10 mins, 15 mins if you can stop salivating on the steak.
Why raise the steak? To keep that awesome crust from getting lost in the steak’s juices. Why rest it? To allow the juices to properly redistribute through the steak.
Next? Eat. Or should I say “Good Eats” by Alton Brown. Whose show on steak cooking is an education in itself.
Enjoy~ BTW.. when and where is the next NJREREPORT bar-b-que?? I have a great home made cole slaw to bring!
Ok
To h3ll with you’s all I just googled Igoogle
http://googleblog.blogspot.com/2007/04/youve-got-gadget-mail.html
kl
JB, to accompany your steak, I recommend cutting a well scrubbed (& not peeled) potato in half and cutting each half into 8 wedges. Deep fry until golden brown all around then drain on paper towels, lightly salt (or heavily salt, depending on your taste!) and serve with your steak. A variation on pomme frites. They should be crispy on the outside but tender on the inside.
Also recommended are steamed green beans or asparagus!
Enjoy!
I find that I still need to start the steak outside on the grill. Too much smoke for inside. I preheat the cast iron skillet on the grills side burner for about 10 minutes before throwing on the steak. Of course, you don’t need a Viking grill for that…any halfway decent grill will do.
On another subject…fish…can anyone recommend a place in the Clifton area to get sushi quality fish? I don’t want to buy prepared sushi; I just want to buy the sushi quality fish to do it myself. Most of the local fish markets have been put out of business by the big grocery stores. I really don’t trust eating raw fish from a grocery store.
As usual, I try to post something thoughtful and I’m met with hoots of derision. The hostility and resentment exhibited by some here knows no bounds. Guess what? I don’t have to take this and I’ll be back to comment directly on those who think things are so “funny” and those with the “cute” manner of discourse whereby their response is thick with sarcasm.
Many of you still have to buy a house and there should be some consideration of checking the gloating attitude at the door.
“Many of you still have to buy a house and there should be some consideration of checking the gloating attitude at the door.”
The feeling is mutual.
For those of you who don’t scroll down the page, be sure to read:
https://njrereport.com/index.php/2007/05/12/a-peek-into-the-boiler-room/
RentinginNJ Says:
May 12th, 2007 at 12:27 am
On another subject…fish…can anyone recommend a place in the Clifton area to get sushi quality fish? I don’t want to buy prepared sushi; I just want to buy the sushi quality fish to do it myself. Most of the local fish markets have been put out of business by the big grocery stores. I really don’t trust eating raw fish from a grocery store.
Rent: Whole Foods on Prospect and Eagle Rock in West Orange. Bring a suitcase for your money. The one in Montclair is closer, but it is a shoe box.
http://www.wholefoodsmarket.com/stores/westorange/index.html
reinvestor, cut the cr*p. You’ve been falsely whining about people’s attitudes for a year now. Haven’t you found any other outlet for your problem?
You make me miss the $300 jeans guy. At least his whining was about his own insecurities, and he wasn’t spouting off economic inanity to get a reaction.
Telling sellers not to lower their prices. Or what? Is that like when you told me you were keeping an eye on me?
Do you truly think sellers casually stop into this blog, read your post, and decide to forgo a possible sale by not negotiating? Of course not. You just like to bully people. You’re too chicken sh*t to go out to club and start pushing, so you find other insidious methods to feed your little beast.
Here…
http://www.bullyonline.org/workbully/bully.htm
Get rid of your baggage and move on with your life.
#217
He’s probably going home to get his big brother. When he coem back to the playground….
Ah! childhood.
SP – coem = comes
“I don’t have to take this and I’ll be back to comment directly on those who think things are so “funny” and those with the “cute” manner of discourse whereby their response is thick with sarcasm.”
Don’t let the door hit you in the #ss.
By the way, how can a seller see the whites of the buyers eye? More like the sellers laid out looking at a size 10 ready to trample them.
I hereby nominate #126 for Troll of the Month. JB, do these nominations have to be just for a specific comment? It sometimes seems that a troll is really composed of several messages.
BC Bob: You are so right, what a difference a year makes. All the former bulls I know, now longer want to talk about real estate. Now its how do you like in 08.
A little advice for our fellow buyers: If you’re a Braveheart fan like myself, in the words of William Wallace – HOLD! HOLD!! HOLD!!! The sellers have been winning the battles for the past seven years, but with patience and solidarity the buyers will win the war! They need our HARD EARNED money, spend it wisely and prudently.
126
I want my tinfoil hat
I want the gvment rays to go away
I want the housing to go up
I want lots of money to day
I kind of look at the Chinese Stock market like the diamond market.
You pay for a diamond. It ostensively appreciates in value [e.g., my wife’s engagement ring purchased in 1998]
Sorta off topic not to mention a non-sequitur to the quoted text but…
The “diamond market” isn’t a “market”; it’s a scam. How else can you explain a process whereby the consumer buys something that IMMEDIATELY loses half it’s value (assuming you bought what you THINK you bought)?
If you measure value by your wife’s reaction, then fine. But woe to anyone who thinks a “diamond” is valuable as a physical asset.
I’ve made money off the Chinese stock market and I’ll bet you have too. The only people making money off diamonds are in the diamond trade. And they see everyone else in that chain has having the word “chump” written on their foreheads.
James Bednar Says: (#9)
May 11th, 2007 at 7:28 am
Is the state setting a dangerous precedent?
________________________________________________
“….>>>>Marcal gets its job-saving tax break
Marcal Paper Mills Inc. will get its energy tax break.
The seven-year-long break became law Thursday after Governor Corzine opted not to take action on the legislation, which was approved by the Senate March 12 and the Assembly a month earlier
The governor believes this bill has an important objective – the preservation of manufacturing jobs – and he will allow it to become law,” said Brendan Gilfillan, Corzine’s spokesman. “We are concerned, however, with how this was achieved. We believe that providing legislation designed to provide financial benefits to only a very small segment of the manufacturing sector is not the best way to develop and implement economic development policy.
James Bednar Says: (#9)
May 11th, 2007 at 7:28 am
Is the state setting a dangerous precedent?
________________________________________________
“….>>>>Marcal gets its job-saving tax break
Marcal Paper Mills Inc. will get its energy tax break.
The seven-year-long break became law Thursday after Governor Corzine opted not to take action on the legislation, which was approved by the Senate March 12 and the Assembly a month earlier
The governor believes this bill has an important objective – the preservation of manufacturing jobs – and he will allow it to become law,” said Brendan Gilfillan, Corzine’s spokesman. “We are concerned, however, with how this was achieved. We believe that providing legislation designed to provide financial benefits to only a very small segment of the manufacturing sector is not the best way to develop and implement economic development policy.
CommanderbobNJ sez:
Concerning this above James, I’m afraid that I would have to disagree with your opinion of not saving the Marcal Company from final bankruptcy.
This company provides much more than the 900 jobs within Marcal….The rule of thumb for industrial job creation is at least 2 1/2 jobs connected with supplying, servicing, transportation etc.-for every job within the Marcal Company.—-That means 2000 + other jobs–In this case of Marcal it is real wealth created–Taking waste newspaper and turning it into everyday products–and since it is a local business,-Trucking to distant warehouses cuts back on long-distance highway usage, saving money and allowing us, the consumers, to buy a local “GREEN” product (This should PLEASE most or All of the so-called environmentalists–But,as always the WACKOS of the ‘Mentalists don’t like the cancelling of ‘pollution’ State of NJ fines “caused” by this struggling company..)
I totally agree with Assemblywoman Nellie Pou (D-Paterson) the co-sponsor of this Bill with saving what is left of our manufacturing jobs in the Bergen-Passaic areas—-The North Jersey.com website did an excellent write-up—-I would strongly suggest that other posters here read it..
This state has lost thousands of good-paying middle-class positions during the past 30 years-
We cannot afford to lose any more! The local property tax base cannot ONLY be supported by the residental sector of any community—-This greatly affects all of the property owners. As I have written in past postings–An average of $15,000-to-$18,000/year in your property taxes in 5-to-8 years from now is VERY POSSIBLE .–This makes buying or KEEPING a home in this state -(IMHO)-more of a concern than ever !!——–
Happy Mother’s Day to ALL !!!!
An average of $15,000-to-$18,000/year in your property taxes in 5-to-8 years from now is VERY POSSIBLE .
There goes all of someone’s pension
I live in Monmouth Co my property tax is now $23,678.how much higher can it go? before I go broke???
#227 gary’s wife: FREEDOM!!! FREEDOM!!!
California REO prices cut.
http://www.streamfx.com/CW/REO-California27.html
NJ price cut
http://www.streamfx.com/CW/REO-New-Jersey.html
commanderbobnj Says:
May 12th, 2007 at 10:54 am
James Bednar Says: (#9)
May 11th, 2007 at 7:28 am
Is the state setting a dangerous precedent?
____________________________________________
Concerning this above James, I’m afraid that I would have to disagree with your opinion of not saving the Marcal Company from final bankruptcy.
cbnj: I apologize, but I cannot politely disagree with you more. You must consider the NJ government’s resources as scarce.
The problem is that there are so many elected officials that are completely divorced from fiscal responsibility and have a Pavlovian reaction to pandering to a voter base.
Bottom line, this business is going bankrupt for likely several reasons, including incompetent management, bad strategic planning, and high cost structure.
Likely everything except the management has a strong correlation to the fact that they are located in a densely populated area in NJ.
You cannot just view the state of NJ’s resources as a big fire hose blasting water, and oh….let’s just siphon off a bit here for these people, and some more for those people.
What people fail to understand is that the water pressure in the hose is not self-perpetuating. You have to ensure there are enough resources to keep the water flowing.
This action is the equivalent of punching a hole in the hose and providing nothing in return. When you destroy the rigor provided by the market, you doom yourself to a whole host of unintended consequences [Marcal has no business being here – and prevents all the commerce and economic activity from adapting to a more appropriate alternate use], and in the long run dries up our water pressure.
A little morsel for all you Red Sox haters. Looks like Mr. Henry should spend a little more time at his day job, rather than figuring out new ways to shake down his team’s fans:
http://www.thestreet.com/_tsccom/funds/followmoney/10355006.html
Paul, post 233:
How much you got?
More seriously, you don’t say what town you live in or what you think your house is worth. In most of Monmouth County you could have a a very nice house and tax bill easily half of what you now pay, so I’m guessing the place is pretty nice.
Everyone wants to pay less, and you’re in a place where if you choose to you can, but the choice is yours.
Anecdote:
Follow small development in hot Middlesex town (friend lives there). Late 1980’s build, small lots, very uniform, no problems. 3 and 4 bed options.
2005/2006 they were selling quickly for upper 300’s/lower 400’s depending on bedroom number.
Currently 5 sitting on market, some for several months, one is also available for (extortionate) rent. Asking range $399-419.
Now seeing price drops, 10-20k. Biggest drop was in lowest price house, went to 379 then 369 for a month, now suddenly dropped to 339 which is well below 2004 comps.
Will be interesting to see what happens to them.
reinvestor101,
Hey. Whatever you are smoking, let me have some…so I can’t forget about how much money my wife & daughter just spent at that damn Coach store.
Yikes!! Its the big one Elizabeth ;)
SAS
Is there a lag with the posts?
SAS
he he..
That should be “so I CAN forget”
;)
SAS
recent quote:
M. Farrel CEO of Annaly Mtg.
“The country is going through a real estate dperession.”
I agree
Misery building to a pek in 2008. It ain’t going to get better anytime soon.
Bleed’em Dry!
BOOOOOOOOOOOOOOOOYAAAAAAAAAAAAAAA
Bob
Panic!
You feel it?
hehehehehehehehe
“The country is going through a real estate dperession.”
“DEPRESSION” THAT’S WHAT THE MAN SAID.
Can’t spin this one.
Sales Prices are tanking asking still got a few last minute greedy grubbers still fantasizing..
BOOOOOOOOOOOOOOOOOOYAAAAAAAAAAAAAAAAAAA
Bob
2008 is when all the real real misery starts happening.
Simple rule dummy. do a little homework.
Take at a minimum “at least” 25% off of 2005 Phoney house prices.
Cheers
BOOOOOOOOOOOOOOOYAAAAAAAAAAAAAA
Bob
2004-2005 were PHONEY House prices!
You tell’em that. The starving bunch.
hehehhehehehehe
Although I don’t think we are in a RE depression.
I do agree that come 08, ALOT are going to be feeling some pain and there are still alot of sellers in disbelief. If they wanna prevent major pains ahead. Better take a 20% haircut right now, while you can….
SAS
make money,
My BS detector is going off.
SAS
BBB,
Yes, here’s hoping that in a year or so we can yell “Freedom”!!
“You pay for a diamond. It ostensively appreciates in value [e.g., my wife’s engagement ring purchased in 1998]”
Unless that ring is a blue diamond, it ain’t worth much. The bloke above was correct when he said that:
“The “diamond market” isn’t a “market”; it’s a scam”
Keep in mind X-ray machines that radiated the Afircan miners on a daily basis to detect diamond thefts. You think they have OHSHA in Africa?
SAS
JB,
#28-YOY contracts
Very telling, especially the April column–all in the red. Thanks.
njrebear,
#236-
Do other banks/lenders offer this info online?
#248 2003-2005 Phony Houser Prices,and I will of course tell them.
orion,
I don’t know. I happened to come across the listings while browsing
http://countrywide-foreclosures.blogspot.com/.
http://www.morganstanley.com/views/gef/index.html#anchor4869
Past the Point of No Return
On May 9, the US House of Representatives held what was billed as a tripartite hearing of three subcommittees on “Currency Manipulation and Its Effects on US Businesses and Workers.” At the end of over three hours of grueling give and take, I left Capitol Hill more convinced than ever that the protectionist train has left the station.
In terms of the substance of the debate, three things surprised me about this hearing:
First, while the bulk of the discussion was about China, anti-Japan sentiment was formally brought into the picture for the first time.
Second, the case against China was framed mainly around the concept of the “illegal subsidy” – WTO-compliant jargon that frees up Congress to impose sweeping countervailing duties on Chinese exporters.
Third, the congressmen present at this hearing were highly critical of the US Treasury’s bi-annual foreign exchange review process and its failure to cite China for currency manipulation.
With respect to China, I am afraid that means the US Congress has now gone past the point of no return.
More Anecdotal;
Saw several houses drop off the MLS a couple of months ago.
They all have signs outside: “For Sale by Owner”.
lisoosh (258)-
I always love to see the transition from overpriced listing to insane FSBO. It’s like trying to cure a case of denial with a dose of stupidity.
“They all have signs outside: “For Sale by Owner”
Yes, I have noticed this trend too.
Also, I have noticed a hand full of sellers have changed in their “for sale” signs to “for rent” signs.
SAS
My buddy in the sign buisness is doing real well these days. He can’t make enough of the “for sale” signs that we see littered all across NJ.
SAS
629k for Ceder Knolls? This for real?
http://www.336malapardis.com/
SAS
629k for Ceder Knolls? This for real?
http://www.336malapardis.com/
SAS
http://www.nytimes.com/2007/05/13/realestate/13wczo.html?_r=1&ref=realestate&oref=slogin
In the Region | Westchester
Bucking a Trend, More Houses Sell
By ELSA BRENNER
Published: May 13, 2007
IN the context of the depressed housing market nationwide, Westchester looks good. The number of sales has been rising since the start of the year, not falling. Prices, however, are down slightly over all, although not in every town — Rye, for instance, has seen a substantial increase in prices.
And, in another indication of mixed signals about the state of the county’s market, foreclosures are down from last year, but up significantly from two years ago.
Over all in the United States, sales of previously owned homes dropped 8.4 percent in the first three months of the year, according to the National Association of Realtors, a trade group in Chicago.
By contrast, the number of closed transactions during the first quarter of 2007 increased in Westchester by nearly 6 percent from a year earlier, according to a report released late last month by the County Board of Realtors in White Plains.
Westchester’s sales at the end of March totaled 1,927, compared with the record high level of 1,998 sales in the first quarter of 2005. Sales of condominiums were up by 17.3 percent in the most recent quarter, to 319.
Economists and others who monitor the national scene ascribed the downturn to winter weather and tightened lending standards for people with weak credit. In Westchester, meanwhile, those keeping tabs on the real estate market cited the weather as a positive factor, even while acknowledging the negative impact of foreclosures and saying it had been even worse a year earlier.
“The warm spell in January brought people out into the market who usually are not out at that time,” said Harding Mason, president of the Westchester County Board of Realtors and an associate broker at Houlihan Lawrence in Katonah.
Perhaps an even larger factor, Mr. Mason said, was the continued growth of jobs in Manhattan and huge end-of-year Wall Street bonuses that “overflowed into Westchester.”
With sales activity strong, inventory grew only slightly. The county’s inventory of 6,839 units on the market at the end of the first quarter was only 4 percent higher than last year’s, according the report issued by the Westchester-Putnam Multiple Listing Service, a subsidiary of the County Board of Realtors.
“and huge end-of-year Wall Street bonuses that “overflowed into Westchester.”
I think some of that wall street money went up Mr. Mason’s nose too.
Do all these guys read the same script?
SAS
njrebear,
Sounds like a great way to drive up mortgage rates.
SAS,
I saw a movie once abou the diamond mines I think it was 60’s or 70’s starts with a cave in and them having to do an amputation on site.
I never realized, yes daily full power X ray would certainly lead to cancer.
SAS, Beemers, Coach bags, can $300 jeans be far behind? :)
Re: chicago finance (#237)Marcal Paper Mills Inc.
To which you reply to my (#237)————–
—->>> “…Bottom line, this business is going bankrupt for likely several reasons, including incompetent management, bad strategic planning, and high cost structure.
Likely everything except the management has a strong correlation to the fact that they are located in a densely populated area in NJ.
You cannot just view the state of NJ’s resources as a big fire hose blasting water, and oh….let’s just siphon off a bit here for these people, and some more for those people…”
Re: chicago finance (#237)Marcal Paper Mills Inc.
To which you reply to my (#237)————–
—- “…Bottom line, this business is going bankrupt for likely several reasons, including incompetent management, bad strategic planning, and high cost structure.
Likely everything except the management has a strong correlation to the fact that they are located in a densely populated area in NJ.
You cannot just view the state of NJ’s resources as a big fire hose blasting water, and oh….let’s just siphon off a bit here for these people, and some more for those people…”
Commanderbobnj replies:
With all due respect ‘Chicago’, I realize that the state of NJ can’t ‘bail-out’ every business that is in trouble,-but this is not as I understand a LOAN –(a.k.a Chrysler U.S. Government-backed ‘loan’-back in the 1970’s)…. It is instead a “..sales tax break on energy use ….to restore fiscal viability..” After all, energy costs for their business had risen 40%, meaning $10,000.000—–Can’t ‘we’ help this company stay in business ??…Maybe if the state cut back the subsidies of some of their pet projects and programs, then businesses such as Marcal could get the necessary financial help to survive
If the New Jersey government officials and the various civil-service protected bureaucracys were TRULY CONCERNED with helping ALL OF US (business and residental) in energy savings they would work towards placing our state on ‘the road’ towards energy independence !—–
SOME EXAMPLES:
Rebate programs for re-Insulation of existing homes and full power ventilation of all attics (NEW HOMES and OLD)–This will save at LEAST 30%-40% of heating/cooling costs of all homes ($1500.00 {IMHO}-saved each home/each year MINIMUM !) Do the math–how many homes have home searchers here wondered why the upper floor(s) of some houses are so much hotter than the lower levels in the summer with the central AC on ?—Answer: Improper power attic ventilation …Not having this power ventilation means a waste of electricity to ‘pump-up’ the AC in order to “cool-off” the upper floors in hot weather..
Implementation of wind electrical generation off the south coast of NJ (private company presently waiting for the go-ahead—-corzine administration unresponsive !)
Allowing the Major oil companies to commence drilling 100+ miles off the NJ coast for crude oil….We have the refineries available in Elizabeth/Linden to turn the crude into the necessary oil products…Not to mention all the good-paying jobs created and less expensive fuel oil and gasoline..
Allow the Electic-supply companies to construct the nuclear power plants that can give us the “cheap” energy that will keep and expand our Industrial base which will–in turn– expand the jobs necessary for our economy—There are many small manufacturing companies scattered throughout the state (Not just Marcal) that can use the help that I have partially outlined …WEALTH for ANY Nation is mainly created by raw materials turned into products–It is not created by service concerns nor by government jobs and the gambling so-called “industry”………..
Be sure to give MOM a nice big KISS !!!
A very happy Mothers Day to all the moms out there!
jb
From the Asbury Park Press:
Foreclosure facing more homeowners
If you thought the real estate market had hit bottom, think again.
Increasing numbers of New Jersey homeowners are faltering on their mortgage payments, state and local records from the first three months of this year show.
…
James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, New Brunswick, is concerned the state is in the middle of a multiyear housing down cycle, on par with the bust years of 1988 to 1992.
“There’s no computer model that can figure this out,” said Hughes, who studies regional economics. “We don’t know the full scale of the problems. If you bought in 2005 or 2006, you will be the one with the long-term correction. If you were a peak of market buyer, that’s a scary prospect.”
…
Jeffrey Otteau, who heads Otteau Valuation Group, a consulting and appraisal firm in East Brunswick, said the Ocean County results point to a very weak housing market there.
“That’s a big number” of foreclosure filings, Otteau said. “That’s a problem with subprime loans, and higher gas prices, and those people have to drive further to get to work.”
…
Otteau estimated that there are 13,300 houses for sale in Monmouth and Ocean counties, compared with 11,500 at this time last year. As more houses linger on the market, prices stagnate or fall, he said.
Otteau said he’s still on the fence about where the housing market will go. He said the numbers indicate that the current crisis has been brought about more from over-refinancing as people used their homes like a credit card to pay bills or support a lifestyle they ultimately could not afford.
Otteau said he’s still on the fence about where the housing market will go. He said the numbers indicate that the current crisis has been brought about more from over-refinancing as people used their homes like a credit card to pay bills or support a lifestyle they ultimately could not afford.
I saw a commercial last night on TV advertising one of those huge, multi-burner stainless steel grills on a slate and brick patio, on beautifully landscaped property with a gigantic, kidney-shaped, inground pool with underwater lighting. The property looked like something you’d see in those home magazines. Now, you tell me what message that scene is sending.
commanderbobnj Says:
May 13th, 2007 at 12:52 am
cbnj: I think we agree. Marcal falls under the umbrella of “pet project”, and your suggestions are forward thinking, with one exception – drilling off the coast? ever been to Texas? – would you really want to have to bring terpentine in the car to clean your feet after walking on the beach on LBI?
Vecsey NY Post:
O.J. Simpson was refused service at an upscale Louisville steakhouse on the eve of last weekend’s Kentucky Derby. His lawyer claimed the incident was about race, which the restaurant owner denied.
“I didn’t want to serve him because of my convictions of what he’d done to (the Brown and Goldman) families,” Jeff (no relation to Jack) Ruby said. “The way he continues to torture the lives of those families … with his behavior, attitude and conduct.
Yeah, there’s that, but there’s also the minor detail that no one in his/her right mind wants to be in the same room with Simpson and cutlery.
****
According to reports, Ricky Williams tested positive again last month. Nothing new to this story, he contends, merely a “re-hash.” … Bobby Brown is taking ex-wife Whitney Houston to court, battling over the custody terms for their 14-year-old daughter. Sensing the delicate nature of this issue, Brown referred all comments to his spokesman, Alec Baldwin. … Finally, Shawn Kemp wanted to offer his annual Mother’s Day reminder, “To those I’ve already touched, the check is in the mail. To the rest of you lovelies, I’m working as fast as I can.”
“In an attempt to help residents, the state last week announced a $30 million program to offer mortgage loans to those struggling to pay adjustable-rate and interest-only mortgage loans”
**Why is it the state’s responsibility to feel it must take care of the irresponsible….isn’t that what welfare is for anyways??
“”The market is flooded with houses,” Waxman said. “The houses are sitting and not selling, because buyers are thinking the prices will come down further.”
**Hey Waxman, and they are correct too for thinking this. Maybe the focus should have been on some of these sellers trying to price gouge a buyer.
Waxman… your a joke.
SAS
“In an attempt to help residents, the state last week announced a $30 million program to offer mortgage loans to those struggling to pay adjustable-rate and interest-only mortgage loans”
**Why is it the state’s responsibility to feel it must take care of the irresponsible….isn’t that what welfare is for anyways??
“”The market is flooded with houses,” Waxman said. “The houses are sitting and not selling, because buyers are thinking the prices will come down further.”
**Hey Waxman, and they are correct too for thinking this. Maybe the focus should have been on some of these sellers trying to price gouge a buyer.
Waxman… your a joke.
SAS
Opps, sorry JB about all the double posts.
I guess when I type, I get too excited and pound this damn keyboard ;)
SAS
Inventories in NJ are up by 1000 this week to a record of 94,000 units. Anybody wants to buy a house for their mother?
commander bob (270)-
I’m no fan of gubmint bailouts and corporate welfare, but your argument has merit. Every suggestion you make is something that will pay off in savings, now and in the future.
Of course, since your suggestions are both simple and involve common sense, the gubmint of NJ will never get behind them.
NJ gubmint’s internal decision-making process: a) determine the most difficult, inefficient, expensive and complex way to attack problem…b) proceed.
#272
Does Roger Lauritsen of Lakewood realizes that he owes taxes on $75,000? It’s one thing to miss your mortgage payment and another to miss IRS payments. The difference is apartment in NJ or federal prison.
And a Happy Mother’s Day to mine and yours!
And a thanks to the Wifey: patient Mom, patient with adult blogger child (me), and uber-housing bull. If she ever shows up here, she’ll make ReInvestor 101, makemoney and Reechard look like the limp-wristed, trolling wussies they are. Her bullishness is the hormonally-driven, DNA-hardwired kind…like a maternal wolverine fiercely digging and padding her little piece of earth.
Not to imply, however, that my wife looks anything like this:
http://www.fhwa.dot.gov/environment/wildlifecrossings/photo12.htm
#274- omg, CF! I so remember that! I grew up south of Houston & we would occasionally go to the Galveston beach & have “tar” all over our ankles. No thanks, I think NJ has enough issues not to have that, too.
re: Foreclosures. I checked my NWNJ town earlier this week & found 86 homes in some stage of foreclosure via Realty Trac. That was up from about 75. I then checked the small, 1-mile square town near Paterson in which my in-laws live…551 homes in some stage of foreclosure! Their town really is only ONE SQUARE MILE! That is just amazing & scary, isn’t it?
Happy Mother’s Day!
clot:
I assume more like this…
http://www.maxwaugh.com/mich02/cheerleader.html
“Clotpoll Says:
May 12th, 2007 at 7:42 pm
lisoosh (258)-
I always love to see the transition from overpriced listing to insane FSBO. It’s like trying to cure a case of denial with a dose of stupidity.”
What may be really telling is that several of them were not priced outside the realm of reasonability – they matched 2005 comps but sat for months. They may be the canary in the coal mine regarding a last stand before they finally “get it’.
60 Minutes, tonight. Watch It!
http://www.cbsnews.com/sections/i_video/main500251.shtml?id=2791263&channel=60Minutes
Gary #287, good link. It airs tonight at 7:00PM.
“Bought & Sold” airs at 10:00PM:
http://www.hgtv.com/hgtv/shows_hbas
#264 NJ Gal Bought IN Westchester at less than price paid in 03
#264 NJ Gal Bought IN Westchester at less than price paid in 03.
bbb,
your anecdotal evidence about NJ Gal seems to support the point of the article i.e sales in westchester are increasing and prices are decreasing.
“The firm’s letters to the clients blame the market for not following trends”
Clot,
The above from your John Henry article.
I can’t believe they actually wrote this. Over the years, JH has been known to be one of the best currency traders in the world. The currency markets are the best trending animals on the screen. What has been a better trend than the dollar, euro, kiwi,cd, pound, etc.. OK, of course China.
JH is spending too much time trying to squeeze the Soucks fans. In addition to this, constructing algorithms pertaining to Big Papi’s shots.
Wolverines? Simply the best fight song on college today;
Now for a cheer they are here, triumphant!
Here they come with banners flying,
In stalwart step they’re nighing,
With shouts of vict’ry crying,
We hurrah, hurrah, we greet you now,
Hail!
Far we their praises sing
For the glory and fame they’ve bro’t us
Loud let the bells them ring
For here they come with banners flying
Far we their praises tell
For the glory and fame they’ve bro’t us
Loud let the bells them ring
For here they come with banners flying
Here they come, Hurrah!
Hail! to the victors valiant
Hail! to the conqu’ring heroes
Hail! Hail! to Michigan
the leaders and best
Hail! to the victors valiant
Hail! to the conqu’ring heroes
Hail! Hail! to Michigan,
the champions of the West!
We cheer them again
We cheer and cheer again
For Michigan, we cheer for Michigan
We cheer with might and main
We cheer, cheer, cheer
With might and main we cheer!
Hail! to the victors valiant
Hail! to the conqu’ring heroes
Hail! Hail! to Michigan,
the champions of the West!
chicagofinance and bednar,
when are you going to buy a place?
Rating Agencies Could be Liable for Investor Losses — Study
http://financial.seekingalpha.com/article/35263
#293 asks: “when are you going to buy a place?”
what makes you think they don’t already own property?
sl
ronan Says:
May 13th, 2007 at 3:40 pm
chicagofinance and bednar,
when are you going to buy a place?
R: not actively in the market – if I was sitting and waiting, I would probably go at the earliest toward the end of this year – ideally I would wait until September 2008.
Setting aside theoretical discussion, I have variables in my personal situation and also several issues with my family. As a result, realistically, it is pointless for my wife and me to make that kind of commitment until the second half of 2010.
If there is a housing crash, I may reconsider that project. Also, that doesn’t preclude me from considering investments in RE.
still_looking Says:
May 13th, 2007 at 6:31 pm
#293 asks: “when are you going to buy a place?”what makes you think they don’t already own property?
sl
sl: don’t you know my story?
Ok, who saw the 60 Minutes piece. It was Awesome!
Pa. fund announced for subprime borrowers
http://www.bizjournals.com/philadelphia/stories/2007/05/07/daily42.html
lisoosh (286)-
Not only do the price adjustments have to be correct; they must be timely.
A month late on a decent price reduction is still not enough. Chalk it up to the “catch a falling knife syndrome”.
BC (292)-
All that from a guy who used to think it was smart to bring in his closer in the 6th inning. When he finally manages to chase away all his smart baseball people (it’s guaranteed he’ll do something to make Theo walk again), the Sox will be just like the Knicks…a legacy sports franchise owned by a rich megalomaniac.
I didn’t get to see the 60 minutes piece, I was on the road when it aired. Hope that someone posts it up on YouTube.
jb
Can some please confirm an address GSMLS 2384227? I beleive it is 23 PASCALE PL in west paterson. Current list price is $649,900.
I am curious because that home was just bought last year from someone in preforeclosure.
05/23/2006: $499,000
07/15/2002: $362,000
05/11/2001: $277,500
I thought the one around the corner for 499,000 was too high(bought in 2001 for 288,000), but I can see why they think it is priced to sell.
Thanks in advance.
“Got Milk? Not Enough, as World Dairy Demand Outpaces Production”
http://tinyurl.com/2dbp72
SAS
shopping,
You’ve got the correct address.
jb
Increases in the price of dairy and dairy related products isn’t inflation… it’s… uhh… volatility. Keep moving, no inflation to see here.
jb
This week is going to be fun:
Tue: CPI, Redbook, & housing index.
Wed: housing starts & Petro status.
Thur: Philly Fed & money supply (still in vogue for me, but I am old school).
Fri: consumer sentiment
I better get my “shorts” ready.
;)
SAS
Thanks jb.
I guess they feel they got a “real bargain” and can ask for extra money.
CF: “sl: don’t you know my story?”
I must’ve been working that day :-)
Care to post the reader’s digest version or point me to the link for it on the website?
Thanks,
sl
Pat Says:
May 12th, 2007 at 7:42 am
reinvestor, cut the cr*p. You’ve been falsely whining about people’s attitudes for a year now. Haven’t you found any other outlet for your problem?
You make me miss the $300 jeans guy. At least his whining was about his own insecurities, and he wasn’t spouting off economic inanity to get a reaction.
Telling sellers not to lower their prices. Or what? Is that like when you told me you were keeping an eye on me?
Do you truly think sellers casually stop into this blog, read your post, and decide to forgo a possible sale by not negotiating? Of course not. You just like to bully people. You’re too chicken sh*t to go out to club and start pushing, so you find other insidious methods to feed your little beast.
Here…
http://www.bullyonline.org/workbully/bully.htm
Get rid of your baggage and move on with your life.
A snake in the grass just slipped up on me and tried to bite me. Pat, the absolute worst offender and hater of real estate investors and owners. Yes….even worst than booya Bob, “Pain in 2008” or whatever he’s calling himself now.
I don’t have any “problems”, unless you consider my dismay at what has been done to destroy the real estate markets in the country a problem. You have been on the front lines of undermining the health of these markets. Those who believe in this great country have to fight back against the lowballers and their supporters. Sellers should not lower prices and should hold their ground.
Lady, you just stepped over a line of no return. Yes, I’ve kept an eye on you. You have been observed making all kinds of mean spirited comments little comments. You’re the bully and a sneaky kind of bully at that. Rather than throw your punches head on, you try to slip up on people and sucker punch them. I can’t think of anything more underhanded and low. I continue to be amazed at how differences in views over the real estate markets descends into behaviors like yours.
Tell you what Lady, this blog is not big enough for the both of us. Someone’s gotta leave. I request that you refrain from posting here. Please comply with that request immediately.
Thanking you in advance,
REinvestor
“This could take up to a decade. EX Japan
and my renters that is a long time to pay rent and barbeque indoors.”
I had dinner tonight (in PA) with a colleage who lives in Tokyo. He said that home prices have still not recovered from the ~1990 crash, despite interest rates just a bit above 0%. Japan’s economy has been in the tank since then, almost no quality jobs for people who graduated from 1990-2000, the job market is just recently starting to look better.
I don’t have any “problems”, unless you consider my dismay at what has been done to destroy the real estate markets in the country a problem. You have been on the front lines of undermining the health of these markets.
I wish I had the power to move markets. You are giving Pat et. al. way too much credit. Truth is, most of the people here are simply pointing out a house of cards that was bound to collapse under its own weight. We didn’t build the house of cards, nor are we responsible for its collapse. We simply saw it coming and raised the red flag.
Those who believe in this great country have to fight back against the lowballers and their supporters. Sellers should not lower prices and should hold their ground.
Your suggestion of forming a giant price-fixing cartel among sellers is completely un-American. It won’t work anyway. The law of supply and demand can’t be overridden forever. One of the things that make this country great is our free, open and democratic markets. Lowballers are free to lowball and you are free to reject their offers. Other sellers are free to accept a low offer. This is how free markets work in a free country.
RE 302
http://tinyurl.com/252tpt
REinverstor “Those who believe in this great country have to fight back against the lowballers and their supporters.”
I was in Walmart today (not by choice, was called into work and needed to buy steel toed boots and it was the only place open), and judging by the parking lot filled with grossly oversized, underfilled (except with gas) SUVs, kids screaming for something or other, and everyone whipping out plastic to buy more crap to fill up their homes, I’m beginning to wonder if I “believe in this great country”.
And yes I am a first time home-shopper (34yr old engineering grad, no debt, good chunk of cash saved and growing 401k), I watched Sixty minutes tonight, and when I fell that home prices have returned to reasonableness, will not be buying with a RealtorTM. For 6% you’d think they’d at least give a damn and improve MLS (most have tiny, blurry pictures, and incomplete information, Zillow is a much more useful product they should model MLS after).
sincerely
Kurt
^
|
|
CBS 60 min on 6%
Foreclosure facing more homeowners
Housing market weak
Asbury Park Press
If you thought the real estate market had hit bottom, think again.
Increasing numbers of New Jersey homeowners are faltering on their mortgage payments, state and local records from the first three months of this year show.
The numbers suggest wider cracks are forming in the foundation of the housing market. Homeowners in trouble must sell quickly under pressure, default or negotiate with banks for new loan arrangements.
…
The statewide number of actual foreclosure lawsuits is on a pace to increase by 50 percent this year, state court officials said last week.
…
James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, New Brunswick, is concerned the state is in the middle of a multiyear housing down cycle, on par with the bust years of 1988 to 1992.
“There’s no computer model that can figure this out,” said Hughes, who studies regional economics. “We don’t know the full scale of the problems. If you bought in 2005 or 2006, you will be the one with the long-term correction. If you were a peak of market buyer, that’s a scary prospect.”
In an attempt to help residents, the state last week announced a $30 million program to offer mortgage loans to those struggling to pay adjustable-rate and interest-only mortgage loans.
…
Otteau said he’s still on the fence about where the housing market will go. He said the numbers indicate that the current crisis has been brought about more from over-refinancing as people used their homes like a credit card to pay bills or support a lifestyle they ultimately could not afford.
Roger Lauritsen of Lakewood was one person who needed to pay mounting bills. Lauritsen last year faced $28,000 in medical bills that had piled up in recent years because of his heart problems and his wife’s respiratory failure.
So Lauritsen clicked on an Internet ad. He obtained $262,000 through the refinancing of his home.
Lauritsen, 63, a water softener cleaner who brings home about $24,000 a year, had his doubts about whether he could pay back the loan. The mortgage representative he spoke to on the phone assured him that he could, Lauritsen recalled.
Lauritsen and his wife signed the mortgage papers for the loan, with an 8.9 percent interest rate, on their dining room table last June. They sent the documents back by Fed Ex.
Lauritsen was supposed to pay $2,460 a month on the loan. He missed his first payment in October.
Lauritsen avoided a foreclosure, however, after he contacted Waxman Realty in Lakewood.
Agent Joshua Stengel found a buyer for the property and convinced the mortgage company to accept $205,000 and forgive the remaining $75,000, which included accumulated interest and late fees.
Lakewood real estate broker P.G. Waxman, owner of Waxman Realty, said that making deals like Lauritsen’s has been the only way to sell houses recently — by getting banks to accept losses on loans in order to avoid foreclosing on properties.
Waxman said the market has already dropped in Ocean County as households struggle under adjustable-rate loans whose payments have increased in recent months.
Families who purchased their starter home “used every penny to make their first purchase, and they’re in over their heads,” Waxman said. “Then you have two-income families who built large McMansions, and they can’t make ends meet.”
Currently there are many sellers, but few buyers, Waxman added, and prices are coming down.
To prove his point, Waxman pointed to five recent house sales in Lakewood where the sales price was more than $100,000 less than the original asking price.
“The market is flooded with houses,” Waxman said. “The houses are sitting and not selling, because buyers are thinking the prices will come down further.”
Sorry…post longer than I though…worth the read though…here is the link to the whole article
http://www.app.com/apps/pbcs.dll/article?AID=/20070513/NEWS/705130389
The hostility and resentment exhibited by some here knows no bounds.
Reinvestor, you would derive tremendous personal benefit by taking a long look into a full-length mirror.
Pat,
re post 310
REInvestor101 says “You have been on the front lines of undermining the health of these markets.”
How come you get all the credit??
It’s interesting how the realtor on 60 minutes was involved in home staging… now that’s full service. Most times consumers have to shell out additional coin for home staging.
Anyone familiar with the legislation on the prohibition of commission refunds in terms of cash back to the buyers in NJ? What’s the principle behind this law?
I dunno, bear. It’s kind of cool, though, for once to get all the credit for something. Being the youngest of ten, I never got nuthing.
Did you ever go through one of those “Fish” periods at work, when HR convinces the CEO to let everyone have fun (usually during a period of higher profit)? One of the exercises is to just have everyone gather around someone’s desk and clap….
That’s how I felt this morning, waking up and reading that post. Kind of amused, kind of laughing, and kind of embarrassed at the praise.
Except I can’t get over my nagging suspicion that JB is reinvestor.
If I knew for a fact that reinvestor was some pissed-off owner of a property, then I’d really go with the good vibrations.
Pat,
Congrats. You are solely responsible for one of the biggest busts, coming to your neighborhood, in the history of the markets.
Whoever 101 is, it’s apparent he/she is simply an
ignoramus. Sice you possess the powers to be, can you please tell me when to lay out the shorts on the Hang Seng.
Except I can’t get over my nagging suspicion that JB is reinvestor.
Nah, it’s enough work trying to play the protagonist… or am I the antagonist? I guess that all depends on your point of view.
jb
“your anecdotal evidence about NJ Gal seems to support the point of the article i.e sales in westchester are increasing and prices are decreasing.”
Well, I think they bought in 04, closed in 05. So it’s not a 2003 price – the last time this place changed hands prior to 05 was 1995, when the house was almost 400K. And since 95 was generally a low price point, they probably got a good deal then. It backs what my own realtor was saying – sales are down, sellers don’t get it, and so prices have dropped. You also have to understand that my people HAD to sell quickly, so I got a good deal, or at least, didn’t overpay by as much as I could have considering I got a perfect condition house. I’m sure values will still go down a bit (I think we’ve said it’s already done 10% in Westchester over time, at least in real terms). But we also bought a house we don’t plan to leave for 10 years or so. Otherwise, I wouldn’t have done it. The “starter” places are still massively overpriced.
Pat,
Oh, Pat. I have had so many conversations with you on this blog and not once, not once did I realize I was speaking with the ONE WHO CRASHED THE MARKET. How rude. At least you could have told me that you had something like this up your sleeve. I just thought you were an observer of the market craziness. Little did I know that you were on a campaign to get home(own)(loan)ers to over-leverage themselves, mortgage companies to make imprudent loans, and realtors/landscapers/home improvement stores and home furnishing stores to go on a frenzy. Hmmm. I am going to have to think about how I could have had the wool pulled over my eyes by you. If you can’t trust your blog buddies who can you trust?
O.J. Simpson was refused service at an upscale Louisville steakhouse on the eve of last weekend’s Kentucky Derby. His lawyer claimed the incident was about race, which the restaurant owner denied.
“I didn’t want to serve him because of my convictions of what he’d done to (the Brown and Goldman) families,” Jeff (no relation to Jack) Ruby said. “The way he continues to torture the lives of those families … with his behavior, attitude and conduct.
I went to school with Jeff (Neptune 66′) he was a character then too but one tough cookie he would deck you first then ask questions. It’s to bad O J didn’t refuse to leave Jeff would have toss em’ out !