From MarketWatch:
Housing starts fall 2.1% to 1.47 million pace
Starts of new homes in the United States fell by 2.1% to a seasonally adjusted annual pace of 1.47 million in May, as building permits for new construction rose 3% to 1.50 million on a jump in multifamily dwellings, the Commerce Department estimated Tuesday. The figures were slightly stronger than expected by economists surveyed by MarketWatch. Both starts and permits were forecast to fall to 1.46 million. Completions of housing units fell 0.5% to a seasonally adjusted annual rate of 1.534 million, the lowest total in six years. Construction of single-family homes weakened further in May, while building of multifamily buildings strengthened.
From Bloomberg:
Housing Starts in U.S. Probably Fell in May, Prolonging Slump
Housing starts in the U.S. probably fell in May, signaling the slump in home construction will continue to depress growth, economists said before a government report today.
Builders broke ground on new houses at an annual rate of 1.473 million in May, down 3.6 percent from 1.528 million the prior month, according to the median forecast of 68 economists surveyed by Bloomberg News. Building permits probably rose to 1.47 million from a nine-year low 1.457 million in April.
Lower prices and more incentives have failed to spur interest as buyers wait for even bigger bargains, leaving builders with a glut of unsold properties. A jump in mortgage rates and stricter rules to qualify for a loan will probably reduce demand even more in coming months, economists said.
“Builders are unlikely to increase construction until excess inventory is cleared and sales start to pick up in earnest,” said Michelle Meyer, an economist at Lehman Brothers Holdings Inc. in New York. “We look for starts to drift lower until the beginning of next year.”
Economists’ estimates for starts ranged from a 1.43 million pace to 1.59 million. The Commerce Department’s report is due in Washington at 8:30 a.m.
Housing construction is in its worst recession since 1990- 1991, cutting 0.9 percentage point from growth in the first quarter after detracting 1.2 percentage points in the second half of 2006.
…
Hovnanian Enterprises Inc., New Jersey’s largest homebuilder, last month reported its third consecutive quarterly loss as it cut prices and wrote off land options while sales continued to plummet.“Without a doubt, things have slowed since about March,” said Ara Hovnanian, the builder’s chief executive officer in an interview yesterday. “There is not a recovery that is about to happen.”
Housing starts data due out at 8:30am. Will be updated as information becomes available.
I know of a fellow who left this week to goto Florida to look at “investment” condos. He wants to pick up 2-3 at around 500k/each.
I tried to talk him out of it, oh man.
This bloke must of drank too much of the kool aid for the past few years.
So, I guess there are still a good amount of naive buyers out there who thinks RE “only goes up”.
He will regret it.
SAS
Maybe he’s involved with mitigating factors that override a break-even. I also know someone who sold FL in 2004, bought GA in 2005, sold GA in 2006 and retreated, and is now looking at FL again for a Nov/Dec close.
http://www.federalreserve.gov/boarddocs/speeches/2007/20070615/default.htm
There’s some coffee reading. BB wants more “skin in the game.” I’m surprised he came out and called for the application of bank channel process to non-bank lending.
Anyway, he sees the Kool-Aid for what it is, at least. Or, maybe he’s been sticking his finger up in the political wind.
sas: talk about arriving to the party late…
maybe the guys smart with a set of
chestnuts.
their are bargins around .
OT re: Webhosting
source: The Kirk Report
Probably only of interest to JB, but I thought some of his experience might be relevant.
*****
“It’s been a tough six days. Problems began last Wednesday (lucky June 13th) when our webhost provider decided to shut us down because of usage overload problems. From then, it was a mad scramble to find an alternative and do so quickly.
After some debate, we decided to go with ViaVerio on Friday who seemed to offer the best solution. They offered a managed private server with all of the bells and whistles, backed by 24/7 telephone support. Little did we know how much we would need to rely on that support.
Between early Saturday morning and Sunday, we experienced major hardware issues requiring numerous reboots and customer service hand-holding. By Saturday night, I decided to cut bait and move to a different company and do so as soon as possible. The problems we were experiencing were unusual and convinced me that ViaVerio simply did not have their act together. This is not unusual in the webhosting industry. Over the years I’ve had experienced with roughly a handful of providers and all of them have big room for improvement. In fact, I learned today from our customer sales rep at ViaVerio that “they’ve been having issues with those servers for some time now.” Great, that was information that could have come into use a few days ago before we wasted two days, programming time, and lost productivity.
From Sunday morning to this afternoon, we’ve then been working around the clock to get the website up and running again. My programmer has been patient, vigilent and hard-working throughout and I owe him quite a bit of gratitude. Because I know some of you want to know this – the members’ only website is now hosted by mediatemple and we’re crossing our fingers now that the worst is behind us. (The free website will remain at TypePad for the foreseeable future). At mediatemple, I’m on the ultra-expensive plan with as much raw firepower that should be able to handle anything we throw at it and more. Which is good, because I’m only half done with the major upgrades planned to the members’ only website this year.”
Some humor for this morning from Dilbert. Also telling as this mentality/ media / buzz, is moving in the opposite direction now
http://www.dilbert.com/comics/dilbert/archive/dilbert-20070618.html
It’s time for one of my media rants. Don’t worry, it’s a small one.
Lower prices and more incentives have failed to spur interest as buyers wait for even bigger bargains…
Almost every business story written has a sentence like the one above and universally they are nonsense.
The writer, or the economist being quoted if the writer chooses to distance himself, is guessing at the motives of market participants (or worse parroting someone else’s guess) and frankly they just don’t know, because they can’t.
The sentence discounts all other possibilities, chiefly that there is no market for what is being sold at the price being asked. Buyers may not be waiting, they may not exist.
The problem for Bloomberg and its writers when they do this is, a person like me questions other aspects of the story that may or may not deserve scrutiny.
The really odd thing is, taking it out of the story doesn’t hurt it in any way. It’s enough to report that people aren’t buying, there’s no need to guess at why.
The business press needs to stop guessing at motives, particularly for things that aren’t happening.
“Buyers may not be waiting, they may not exist.”
Lindsey,
Excellent point. Sell? Sell to whom?
From Reuters:
Seeds of credit crunch grow in LBO loan market
Investors looking for signs of a crack in the credit markets are turning their attention to a corner of the debt market that’s been feeding the leveraged buyout frenzy.
Banks used to finance buyouts mainly with loans on their balance sheets, but are now packaging and selling that debt to investors using instruments called “collateralized loan obligations” (CLOs) that group various loans together to diversify risk.
…
In the old days of relationship banking, banks relied on credit quality control and huge balance sheets to ride out any problems, but CLO investors may be more short-term oriented.
Lack of credit quality control by some managers of CLOs is particularly frightening to veteran private equity investors.
here’s my feeling re: business reporters:
if they really knew what they were talking about, they’d be doing it instead of writing about it.
also, the people who talk to reporters usually have an agenda
From MarketWatch:
U.S. May housing starts fall 2.1% to 1.474 million pace
U.S. May building permits up 3% to 1.501 million pace
Housing starts, building permits stronger than expected
U.S. May housing completions fall 0.5% to 1.534 million
U.S. 5-month average housing starts fall to 1.47 million
U.S. May single-family housing starts fall 3.4%
U.S. May multi-family housing starts up 3.1%
From Bloomberg:
U.S. Housing Starts Fell 2.1% in May to 1.474 Million Pace
Housing starts in the U.S. fell in May, signaling the slump in home construction will continue to depress growth.
Builders broke ground on new houses at an annual rate of 1.474 million, down 2.1 percent from 1.502 million the prior month, the Commerce Department said today in Washington. Building permits rose 3 percent to 1.501 million from 1.457 million.
Lower prices and more incentives have failed to spur interest as buyers wait for even bigger bargains, leaving builders with a glut of unsold properties. A jump in mortgage rates and stricter rules to qualify for a loan will probably reduce demand even more in coming months, economists said.
“There is way too much supply,” Joshua Shapiro, chief economist at Maria Fiorini Ramirez Inc. in New York, said before the report. “If you’re a homebuilder with inventory, the market is skewed against you.”
…
Economists surveyed by Bloomberg News forecast starts would fall to a 1.473 million pace, from a previously reported 1.528 million in April, according to the median forecast of 68 economists surveyed. Estimates for starts ranged from 1.43 to 1.59 million units. Permits were forecast to rise to 1.47 million, according to the survey.
Starts were down 24 percent in the 12 months ended in May.
…
The drop in starts was led by a 20 percent slump in the West. Construction also fell 1.6 percent in the South. Starts rose 16 percent in both the Northeast and Midwest.
“If you’re a homebuilder with inventory, the market is skewed against you.”
OK. Lower prices and incentives are not doing the trick for H-B’s. How about existing home owners with inventory? Is the market for exisitig homeowners skewed or a bust?
Mortgages Give Wall St. New Worries
After the first cracks in the subprime mortgage business appeared late last year, several large lenders were forced into bankruptcy…Now, the stress is sending tremors down Wall Street, as investment funds that bought a stake in those loans are starting to wobble…Industry officials say they expect this second act to be longer and slower, unwinding over the next 12 to 18 months. The fallout could further constrict consumers with weak, or subprime, credit while helping to prolong the housing downturn.
http://www.nytimes.com/2007/06/19/business/19mortgage.html?_r=1&ref=business&oref=slogin
Housing starts plunge as permits rise
Starts fell 2.1 percent in May, but building permit activity increased a better-than-expected 3 percent, government report says.
June 19 2007: 8:47 AM EDT
WASHINGTON (Reuters) — The pace of U.S. home construction fell 2.1 percent in May to a rate lower than analysts expected for the lifeless housing market, while building permit activity increased more than anticipated, a government report showed Tuesday.
The Commerce Department said housing starts set an annual pace of 1.474 million units in May, compared with 1.506 million in April. Economists had forecast May housing starts to drop to a 1.48 million unit pace from 1.528 million originally reported for April.
Building permits, which signal future construction plans, rose in May by 3 percent to a pace of 1.501 million units. Economists had expected the permits to hit a rate of 1.471 million. Permits for single-family homes, however, were at their lowest level since July 1997.
Tuesday’s data comes a day after a report indicating that homebuilder confidence is at its lowest level in more than 16 years.
The National Association of Homebuilders/Wells Fargo Housing Market Index dropped two points to 28 in June. The index of builder sentiment had not dipped that low since it reached 27 in 1991.
Readings below 50 indicate more builders view market conditions as poor rather than favorable.
JB Any thoughts on why permit numbers are up,even with all this inventory?
Also any thoughts on the apparently large increase in the northeast (small potion of the new home market?)
Report from UCLA team skirts the R-word
First-quarter growth fell. Forecasters say it’s not a recession, but ‘it is certainly close.’
By Annette Haddad, Times Staff Writer
June 19, 2007
The sluggish housing market is starting to drag down the rest of the economy, leading UCLA forecasters to conclude that although the U.S. is not actually in a recession, “it is certainly close.”
The nation’s economy grew by a sickly 0.6% in the first three months of the year, the smallest increase in four years and a sharp decline from the fourth quarter of 2006, according to the widely watched UCLA Anderson Forecast.
UCLA economists don’t think economic growth will slip for a second straight quarter, which would signify a recession. But they predict that the economy will stay in a funk till next year as falling home values and rising gas prices put a crimp on consumer spending.
“We suspect that the weakness in the housing market is finally spilling over into consumption spending,” wrote senior economist David Shulman in the quarterly forecast being released today. “Retail sales appeared to stall in April and automobile sales have become decidedly weak.
“This is not a recession, but it is certainly close,” Shulman said.
The Anderson Forecast is closely watched because it predicted the 2001 recession before others.
In a separate report on the California economy, UCLA forecasters predicted home values would continue to fall slightly or remain flat in most parts of the state as many homeowners struggled to make higher payments on adjustable-rate mortgages.
“The pipeline of mortgage resets suggests it may be mid-2009 before California sees a normal housing market again,” said the report by economist Ryan Ratcliff.
Randy Becker doesn’t need to read UCLA’s forecast to know the housing market is in a world of hurt.
. . .
http://www.latimes.com/business/la-fi-econ19jun19,0,6990411.story?coll=la-tot-business&track=ntothtml
Lower prices and more incentives have failed to spur interest as buyers wait for even bigger bargains…
The sentence discounts all other possibilities, chiefly that there is no market for what is being sold at the price being asked. Buyers may not be waiting, they may not exist.
Very good point. This goes to the whole debate on pent up demand and whether or not it really exists on a large enough scale to spur a recovery. The implication of the author’s statement is that an army of buyers is just perched and waiting to strike once the “price is right”. This implies a situation where there is nothing to really worry about; it’s just a matter of builders finding the right price.
In reality, I think the homebuilders overestimated the demand for luxury condo’s & McMansions. While I may in the category of “pent up demand”, I’m not looking for a luxury condo or McMansion.
A decision regarding the “banning of trolls” has been reached.
Since the original post on this topic, I received a flurry of emails (don’t any of you sleep?). I really wish I could post some of them, they really were incredibly well thought out and well argued. The viewpoints ran the gamut from outright banning to taking a clear no-ban position (to preserve point/counterpoint).
We will adopt a no-ban policy here, especially with regards to those who express a position that runs contrary to the “public opinion” here. I can not let this blog be put into a position where it can be argued that I am attempting to silence anyone who doesn’t share the common view. There are plenty of pro-real estate sites that delete any contrary opinions immediately, I don’t wish to be placed in the same category as those sites.
However, I refuse to allow the discussion to degenerate in the way that it has.
I reserve the right to moderate/edit/delete comments that I feel add little value and are clearly “troll-like”.
Here are my criterion for establishing whether a comment should be considered “trolling”:
1) Confrontational style of interaction
2) A lack of in-depth understanding of the topic
3) A lack of a genuinely unique perspective on the topic
4) Restarting topics that have already been done
5) Use of language that encourages the dialogue to enter topics that are controversial and likely to upset some team members
6) The use of an attention-seeking gimmick
7) Follow up their own articles if the group doesn’t respond to their posts
8) Inconsistencies in the style and nature of the post and any proclaimed information
9) A lack of personal information
10) Any attempt to mask identity or post using more than a single user name.
(these points are from: http://www.teamtechnology.co.uk/troll-tactics.html)
Any questions/comments on this, please feel free to email me directly, but do not reply here.
-The Management
Thanks JB. That sounds like a well balanced and fair approach.
JB
fair and balanced. what a guy
Bob/Others,
I have read about hedge funds leveraging up to 25 times their assets. How can that be done? If possible, can you please post a simple example?
Regards
bear,what do you mean..restructuring?
# 8 Lindsey
True, much like the car dealers did with 0% financing, they brought forth mayny buyers that were probably a year or two out. and now they wonder why their sales are dropping. Many rush into this market, before they got priced out
JB,
I’m definitely in favor of anti-trolling measures. If nothing else, endlessly repeating the same point just to get a reaction needs to be stopped.
Please note, I do not consider Booyaa Bob in the above category because he is not really looking for a reaction, he is providing comic relief.
If I look at my circle of friends and family, almost everyone has bought a house in the last 3 years. So you are right, there might not be buyers at all. A good majority of buyers already own homes, so just by reducing price will not jump start the housing market. Looking at history, it takes time and a lot of time (10 years plus) for housing to recover because thats the nature of the beast.
Sorry about putting my reply in the thread JB. I’m “multi-tasking” and doing a half-assed job of everything.
bear [23],
Quick example. Gold Futures, initial margin for 1 contract is $2,700, maintenance margin [holding a position] is $2,000. Gold is now trading at approx $658. The contract is 100 oz.. $2,000 in maintenance margin controls the cash equivalent of $65,800 or almost 33-1.
Depending on the relationship, i.e. comm dollars, the clearing firm will give hedge funds much more leverage that the above [retail] example.
Cash currencies? 100-1 leverage to start [retail].
Skeptic, post 11
You seem to be making the same mistake regarding motivations as the reporters.
People have lots of reasons for doing things, and probably more reasons for not doing them.
njrebear,
There are numerous ways to lever up, depending on what instrument you are trading. In the case of something like derivatives (options, futures) there is leverage built into the contracts. You put up a small amount of cash for the right (chance) to profit on the moves in a much larger dollar amount of the underlying instrument or commodity.
For other trades, you simply borrow lots of money as cheaply as possible. For years is has been possible to borrow in Japan for close to 0% and invest the funds for a higher return elsewhere. This is why everyone is harping on the Yen carry trade and the effects if/when it unwinds.
People on this list talk about it on occasion, but never explain this – why is Westfield considered so special? Is it all about the schools? Having moved here from Austin five long years ago, I have to say Westfield strikes me as pretty Stepford-ish. Don’t get me started on the mall as downtown, either.
And why is NJ so resistant to consolidated/county school districts? I have my own ideas, but would like to hear other opinions.
I guess BC Bob beat me to it. Ditto.
At the beginning of the year 1998, LTCM had capital of $4.8 billion, a portfolio of $200 billion (borrowing capacity in terms of leverage) and derivatives with a notional value of $1,250 billion.
Good for you JB. I am glad to see that this site won’t turn into another one sided radical forum like Kannekt. Trust me, you do not want to go down the Kannket route because sites with no credibility don’t last that long.
Pat (24)
I don’t know what restructuring is :(
Rob/Bob/Read my lips….
Thank you very much.
I guess based on grim-master guidelines, I am a troll.
Here is an example of how the big boys leverage on WS>
Lets take a prime brokerage transaction. If you think a stock is going to fall in price you can sell the security lets say for $100 million dollars. Now remember you don’t own the security and you don’t want to borrow cash on margin cause reg t only lets you go up to 50% of the collateral and you have to pony up $50 million. So what you do is borrow the security from an away broker so you don’t end up in a fail to deliver and put up the 2% sec lending premimun and let it be marked to market. Insurance companies and big banks love to lend out securities as there are some small fees to be paid with use of funds back to them and when added in with dividends it juices their return for holding stock . Now lets say the price of the stock falls in half, Great News you go to the open market buy back the same amount of shares you borrowed for $50 million return the shares back to the insurance company pocket $50 million in profit and get your 2% back. All you had to pay is a few bps and use of funds to the insurance company for borrowing the security. But check this out when you sold the shares in the first place you got 100 million cash so you better put it to work. A little arbitrage, credit derivatives, black box trading, covered calls and maybe you got that to go up too!!!!!
However, remember if the stock you sold doubled instead of fell in half that insurance company could demand it back and you would have to pay $200 million to buy back the stock you borrowed and in that case you would have lost $100 million dollars on a two million investment. OUCH
Now th
jrebear Says:
June 19th, 2007 at 9:17 am
Bob/Others,
I have read about hedge funds leveraging up to 25 times their assets. How can that be done? If possible, can you please post a simple example?
Regards
CNBC VIDEOS today: housing numbers/reports !!!
Realty Check: Builder Sentiment
Not since the first Gulf War have home builders felt so glum about their business, with CNBC’s Diana Olick & Bill Griffeth
http://www.cnbc.com/id/15840232?video=383508900
Realty Check: Housing Snapshot
Housing starts finally took the hit so many have been expecting. Insight with CNBC’s Erin Burnett & Diana Olick
http://www.cnbc.com/id/15840232?video=384822693
People on this list talk about it on occasion, but never explain this – why is Westfield considered so special?
Texaninexile,
If you haven’t been a regular here over the past year or so, you would have missed the events that led up to “Westfield” becoming an inside joke among the regulars.
“Westfield”, when used in a negative or derogatory manner, is really a quip towards a town whose residents feel that property values won’t decline because that town has some “special” feature that serves as a justification to set it apart from others.
jb
“Westfield” can really be replaced with any decent NJ town
John,
Thank you. That was very helpful.
Thanks. I was wondering if I was missing something.
So besides Westfield, then, what other towns in the area would people recommend? Our jobs dictate being close to Union and Montclair, and having a very bright child means the need for a “good” school district. Westfield’s schools are not that impressive, so I guess it’s downhill from here?
We’ve looked at Maplewood (don’t want to send our kid to a high school where they have to lock the bathrooms to avoid vandalism), Scotch Plains, Cranford. What about Springfield? We’re looking in the $350-$420K range, and the housing stock in Westfield in that range is disgusting.
Subprime storm winds will keep blowing
By Sue Kirchhoff and John Waggoner, USA TODAY
Borrowers under pressure
Markets feel the stress
Regulators scramble
http://www.usatoday.com/money/economy/housing/2007-06-18-subprime-usat_N.htm?loc=interstitialskip
The Federal Reserve, under pressure from Frank and Senate Banking Committee Chairman Sen. Chris Dodd, D-Conn., held a high-profile public hearing Thursday on whether to write tighter subprime rules in areas including prepayment penalties, stated-income loans and escrow and taxes. The Fed is also considering setting standards for what would constitute an affordable loan.
Check this out. Why would anyone rent a house while the owner is trying to sell? Unless they really just need something in the short term.
http://newjersey.craigslist.org/apa/354624920.html
OT but anyone else hear on the news this morning that they want to pay people in poverty stricken areas to go to school, the doctor, etc.
Texaninexile,
I hate to sound negative here, but realistically, within your price range you will find it very difficult to find anything more than a dilapidated shack in any of the “premier” towns with the top rated schools. I’m just trying to save you a lot of time and effort.
On the upper end of your range, you might be able to pick up a starter cape in okay shape in a town with decent schools.
If a top school is really important, maybe you could consider renting and private school?
Texan,
Sadly, regardless of the town, you are unlikely to find much that you might consider attractive in that price range, at least in NNJ.
You would have to go down to Ocean/Mercer county before finding something you really like I would guess.
Might I suggest renting?
46 – yes, i heard that this morning. i actually thought i misheard it.
On the permits/starts situation.
I don’t know how it is in the rest of the country, but in NJ the timing of permits has a lot to do with when approvals were granted.
You can lose your approvals (which can mean you paid a lot for nothing) if you don’t pull your permits in an appropriate time frame, so in a way, at least in NJ, permits are a lagging indicator.
Renting is what we’ve been doing, I’m afraid, all our lives. We moved here because I got a tenure-track job, and we’d like to put down roots, since we’re both in our late 40s. What we’ve seen in Westfield is that unless you own a house, you have a hard time establishing community. Rentals are generally outside the “neighborly” neighborhoods, and in general people are so busy here with their own lives and families that it’s hard to break in as a newcomer.
#46 tbw yep big articel in the NYT’s this morning.
Texan,
Unless you have a need to commute to NYC, I’d strongly suggest avoiding any of the “train towns”. You’ll be paying a significant premium for an amenity that you won’t be using.
jb
Good point. Thanks!
Kim, #45
Maybe the owners need to relocate, and they want to keep the house occupied while it’s for sale.
The typical homeowners’ insurance policy has a clause that states that the house must be occupied for the insurance to be in effect.
As to who would want a house short-term … by now, it might not be all short. Maybe they’re anticipating a longer selling period, and also want to cover their monthly costs for property taxes, etc.
It could be a good deal for someone who’s also relocating, and wants a house as a rental while they look for something else.
Texaninexile,
You said:
We’re looking in the $350-$420K range, and the housing stock in Westfield in that range is disgusting.
Have you considered Central NJ?
Where is your job?
You can get beaucoup houses in that range in the area around Metropark and the other towns that lie along the NJ Transit/Trenton line.
Is there any way you can find out how much someone’s mortgage is? For instance, I am looking at one recently sold listing, the sale data says that the buyers financing was an ARM. I would like to know how much their mortgage was for.
Texaninexile,
I don’t have children yet, but I encourage you to take a step back and look a the big picture. Here in Northern NJ, we’ve whipped ourselves into a frenzy about schools and rankings, and their correlation to property values. I believe this is because we have so many small municipalities – it’s just another way to localize the real estate market and artificially pump up asking prices. Do you really think there is a difference in the quality of the education in most schools? Take a look at the NJ state report cards and NCLB data. If you’ve got decent test scores, and low crime problems in the school, you kid will do just fine.
Every school has crime. Any time you put a bunch of kids in an area together, there is bound to be vandalism, fights, etc. No town is immune to that…not to mention all the bad parenting that goes on.
Okay, now I’m confused. I thought Westfield WAS in central NJ. I teach at Kean, and my husband works at Montclair State, so we’d like to be pretty close – trying to keep the childcare price down and all that.
I’m not sure about the differences among schools. That’s why I asked. It appears to be a big factor in determining real estate prices.
Of course, there’s also the elephant in the room that no one on the list addresses directly – class. We wouldn’t fit in, for example, in Garwood. Probably Kenilworth, too. We can afford places like that, but we’d be pretty isolated. Or am I wrong?
sorry if this article was already posted (but i think it’s new). i like the reference to the number of exclamation points in a listing.
http://money.cnn.com/2007/06/19/real_estate/housing_rebound.moneymag/index.htm?postversion=2007061910
So does every high school have security guards standing outside the bathroom? Am I that old, or is it just different up here?
Texan,
JB’s #55 advice is the best for your situation.
For the record, we’ve been tenants in Westfield in the same house for 14 years at below-market rent.
We just lucked into the place. With a child in the public schools from K-12, you get right into the community, even as a woebegotten renter. There are some fine folks here and some exceptional young people.
The Westfield public schools are generally excellent.
Cranford and Fanwood/Scotch Plains are maybe a notch lower but still viable. You might find something in these towns in your price range and they’re all decent towns.
But to second JB, if you can find a location off the commuter lines you’ll have more choice. Is there something to that myth that Jersey housing is supported by NYC employment I wonder? Don’t answer, 3b, just wanted to see if you’re awake yet.
Best of luck, Texan, and welcome to New Jersey.
TO Texa
TO post 51: Hi Texaninexile, welcome to the forum.
I do see similar picture – it feels as if renting prevent people to form bond with neighbours, and being part of the local community. Mostly because it is not permanent.
However I got quite a few points on people moving every 7 years or even more often.
A lot of people do not even know names of their neighbours.
Also you can become part of the community by getting involved no matter of your homeownership status.
Unfortunatelly, in towns you are looking at at your price you are very limited to condo’s, very small, outdated starter capes in bad locations. And with 6K+ taxes.
You do not have to go very far South – look in Middlesex, Somerset and Hunterton counties – of course this will involve commuting.
However, being NJ resident for a bit over a year I feel that northern NJ does not have it’s own identity (I am probably wrong here) – it is all about being close to NYC, upscale shopping and who’s got bigger house with bigger car.
Westfield is different story, of course :)
I really like Cranford – beautifull area, but it is wayyyy too expensive with high taxes.
Texaninexile,
You want a nice house in a top NJ town with a top school district and you want to pay $350K? This is one of the more delusional posts I have read. This ain’t Austin, brother.
I am sorry I feel like I have to comment here – JB feel free to remove this one. My Most hated expression: top NJ town with a top school district
TOP TOWN.
I have never heard this expression before I got to NJ.
People are quite snobbish.
JB #20, I would add that ad hominem comments should also be deleted.
Texan,
Westfield is in Northern NJ.
If you go West – towards the PA border – to the county of Sussex and towns like Stanhope and Hackettstown – away from the commuter lines – housing is more affordable. One of my brothers lives in Sussex. They both work in NJ and didn’t need to be near the commuter lines.
Central NJ is counties like Middlesex, Somerset, Hunterdon, Monmouth, and I think, Mercer.
Al #66,
No need to apologize. The proletariat has been properly indoctrinated by the landed gentry and everyone in Northern New Pithy has become an aristocrat. If you want to live here, you’re gonna have to pay. If you can’t afford it, one is classified as a wannabe.
Al,
I am not being snobby. I am responding to Westfield having average schools and that he is looking for a “good” school district. That is a snobby statement. Obviously he needs to be looking in Livingston or Millburn if WF below average for his savant.
#57 tbw Go down to the court house in Hackensack, with the address,and if the house has closed the information is readily available.
The whole school thing is over done. I find it ironic that when Newsweek does its top best 1000 HS’s in the nation, the top NJ HS’s are not even in the top 100.
For instance Ridgewood Nj was ranked 530, or 535, in this years survey, yet it is considered the one of the best in NJ.
#43 Texan
A little more ten years ago,I moved my kids to Catholic schools after a stint in the Springfield public schools. No challenge there for bright kids. The “gifted and talented program” consisted of party-like activities, not enrichment or more challenging curriculum. My oldest was so bored, he cried doing homework. The school administrator’s answer was that he could tutor his classmates–not very conducive to social normalcy.
We moved soon thereafter but I haven’t heard anything suggesting things have changed.
Texan:
“Westfield’s schools are not that impressive…”
If you really feel this way, then you may want to buy in a lower tier town like Rahway with lower taxes and send your kids to private school. NJ Monthly ranked Westfield as the #22 public high school in the state and the grade school have a reputation to match. You are entitled to think the school is lacking, but then you really have no options because you won’t find anything to buy in your price range in Tenafly, Millburn, Glen Ridge, Chatham or the other Northern Jersey towns with top schools.
I would encourage you to check out Springfield because its a nice town with access to NY but not what I consider easy access (unless driving to the community pool, parking there and taking a shuttle bus to the train station and taking the train into midtown is easy). You can actually find decent homes there for $450k although nothing close to what you would find in Texas. The schools are very good (ranked #44 by NJ Monthly for whatever thats worth) and you may find that is a better “fit” for your family. There is a premiere section of town called “The Top” where homes are too expensive but you do have a wider cut of demographics in Springfield. I would move there but the NYC access is not what I need it to be.
If you need to get to Union and Montclair, Springfield is an ideal jumping point. Yes, you will get a little more home for the money in Somerset or Middlesex (certain parts) but I think a 20 minute commute is something you will find priceless here in NJ.
On an unrelated topic, if you ask your RE agent for her current take on the market and she responds with a list of a dozen homes under contract (as opposed to recent sales) what do you make of that?
#75 Seneca: I make nothing of anything thats UC, only closed sales, can you give you any kind of idea as to what might be going on in a particular town.
Seneca–If Texan doesn’t like Westfield schools, s/he is going to be very disappointed in Springfield. I am familiar with both systems, and Springfield simply does not compare to Westfield.
Texaninexile,
Have you thought of going closer to Montclair State? In a search of Cedar Grove, Verona, Caldwell, and West Caldwell, there are 28 single family homes listed under $450,000. Yes, some of them are capes but it might be worth a look.
Lindsey:
“The business press needs to stop guessing at motives, particularly for things that aren’t happening.”
Very astute observation.
Texanexile; Austin is one hell of a town.
Here is that “1300” list:
The Top of the Class
The complete list of the 1,300 top U.S. schools
(Link pasted here is NJ only)
Might as well paste it in here as well.
Rank School Location
28 McNair Academic Jersey City
101 Ridge Basking Ridge
173 Millburn Millburn
200 West Morris Mendham * Mendham
209 Cresskill Cresskill
217 Bernards * Bernardsville
218 Princeton Princeton
266 Summit Summit
460 West Windsor-Plainsboro South Princeton Junction
497 Holmdel Holmdel
570 Ridgewood Ridgewood
611 North Hunterdon Annandale
622 Union County Magnet Scotch Plains
667 High Technology Lincroft
686 Montgomery Skillman
748 West Windsor-Plainsboro North Plainsboro
756 Mainland Regional Linwood
763 Cranford Cranford
808 Northern Highlands Allendale
819 Governor Livingston Berkeley Heights
831 Westfield Westfield
855 Fair Lawn Fair Lawn
880 Livingston Livingston
887 Ocean Township Oakhurst
892 Mountain Lakes Mountain Lakes
921 Glen Ridge Glen Ridge
947 Montclair Montclair
948 Glen Rock Glen Rock
961 Haddonfield Haddonfield
982 Tenafly Tenafly
1019 Montville Township Montville
1039 Bridgewater-Raritan Bridgewater
1054 East Brunswick East Brunswick
1056 Watchung Hills Warren
1103 Northern Valley Regional Demarest
1141 Teaneck Teaneck
1164 Wayne Hills Wayne
1172 Rumson-Fair Haven Rumson
1182 Voorhees Glen Gardner
1201 Johnson Clark
1236 Cherry Hill East Cherry Hill
1258 Columbia Maplewood
1260 Pascack Hills Montvale
1276 Ocean City Ocean City
1307 Hopewell Valley Central Pennington
1314 Freehold Freehold
Where did we leave off yesterday regarding price declines, how much when etc.
if we are only looking at a 5% decline this year, that does nothing for affordability.
Your 500K POS Cape becomes 475K, with an increase in FRM’s and an increase in my town of $600.00 in property taxes, and you have no increase in affordability at all.
Anybody seeing any significant dcliens in theie area/town?
Thanks to everyone for all the info. The range of opinions is most appreciated.
Bystander,
You might not be trying to be snobby, but you are being sexist. I’m not a he, I’m a she. Don’t assume.
Since when is it being snobby to ask for equal treatment for a gifted kid? So-called blue-ribbon school districts – your “good” school districts – are sometimes the worst when it comes to accommodating the higher end of the bell curve, at least in elementary school.
What I find delusional is what people here (in NJ) take as givens; among others – commuting long distance just to afford a house? I’ve got a kid I like to spend time with. I guess I didn’t figure that a university professor’s pay (plus spouse) wouldn’t be enough to afford a decent house. In most parts of the country, it is.
Thanks for the tip on Springfield, Seneca. We’ve been looking there, too.
Startingover – we’re going to have to supplement wherever we go. We know that, and to avoid gifted and talented programs here. There’s no state funding for them, so there’s no real interest on the part of the districts. And of course there’s the anti-elitist crowd to persuade . . .
Willow, I’ll look at those towns. Thanks!
And yes, Austin is amazing. I’m still homesick after 5 years here. Tenure is a hard thing to give up, though.
3b Says:
June 19th, 2007 at 11:20 am
The whole school thing is over done
If you are a stay at home mom in a great school district the school is the focal point of your life. Your involvement in the schools, teams, afterschool activities, playdates, homework etc. are extremely important. I have three young daughters and none of my neighbors have girls in my daughters age group. Of the five closest neighbors to my house I do not even know the names of two of them and I have never set foot inside any of their doors. Mind you we have lots of friends in the town and lots of playdates going on and parents visiting my house. I am a friendly guy, but most people in the NY areas are from here and already have their own relatives and friends to deal with and are not looking for new friends. However, if you have kids the same age and same sex they have room for you.
My daughters elementary school teachers call my wife at home, she has all their home numbers and parents are invited to all class parties. When my youngest child was born a few months ago the teachers in both my 5 yo and 7 yo class chipped in an bought my wife a gift. Believe it or not there is a list of top 100 elementary schools in the nation and the school three houses from my house made the list. The elemetnary school even has a current DOW 30 CEO as an alumni and he drops by once a year as his company is headquartered in NYC. So my seven year old daughter gets to interact with a CEO at school!!! I am soo jealous.
Remember, I never heard of anyone trading up or re-locating to a bad school district from a good school district. That is why starter homes in good school districts are expensive, the dinks get their foot in the door and when the kids come and they trade up they don’t have to switch towns.
3b: I heard they aren’t going to increase RE taxes this year (aside from the school increases)
Texan,
Here’s a house at the LOW end of your range that I know to be a good house in a quiet neighborhood, right around the corner from my parents’ former house.
I’ve never been inside, but I’ve walked past it many times. The ad says “brick front,” but I’m pretty sure it’s solid brick. The owner is a senior citizen who finally decided to move into a senior’s apartment. The house got some work after she moved – dumpster in the driveway. Going by the photos, it looks like a new kitchen, and new wall-to-wall and fresh paint in at least some parts of the house. Also, the basement looks freshly painted and very clean. The house has a good-sized corner lot.
PS, my brother’s kids went to the local schools. No security guards standing outside the bathrooms, and lots of advanced placement classes for the gifted. Both kids got merit-based scholarships for serious amounts.
If you’re commuting by car, easy access to all the major routes – the Parkway, Route 1, Route 27.
MLS ID# 720562
Scribe,
Thanks. I’ll check it out.
Anyone have any comments/opinions on the Fair Lawn ranking?
jb
Texan,
“Hook em Horns”
Willow in post # 78, mentioned a town, Verona, that I thought may be a good location with a great school system. However, it is Essex County. Taxes may be sticker shock. How about renting for a couple more years? Prices may be more accomodating at that time.
http://homes.realtor.com/search/listingdetail.aspx?ctid=91431&ml=3&typ=7&sid=86996ed9af5b4f6b95d0874a85f6f7ba&lid=1078322737&lsn=8&srcnt=90
Wow, Cranford beats Westfield in the top 1300. That’s a surprise.
As a veteran parent of the Westfield public schools, it is my observation that more resources are devoted to special needs than “gifted and talented.” About five years ago the g&t program was changed substantially and not for the better, IMO. (I’m sure local realtors and the BOE would dispute this.)
Texan,
NJ is a big place. Cast a wider net.
Economist expects U.S. home prices to fall 10%
This is interesting.It smells like a recession. It tastes like a recession. It looks like a recession but it’s not quite a recession. Go figure.
http://www.inman.com/inmannews.aspx?ID=63579
Prestigious River Edge schools not on that list
#90 twice: Unfortunately that is happening in ALL of the public schools now.
#93 tbw Newbridge Center
#88 – yes, im actually surprised by the fairlawn ranking. i didnt realize they were a “top school” or whatever that’s supposed to mean. considering fairlawn’s relative affordability, compared to the area, it’s very surprising.
Texaninexile,,
If you are looking for a good gifted program outside school, I know several children who have attended the program at Montclair State on weekends. Teacher recommendation is required but I have heard good things about it.
#85 tbw That is true, yet amazingly some people on the council had a problem with that.
There originally was an increase scheduled, but because of the increase in school taxes, the majority on the council chose to reevalaute that decesion, and were able to cut some expenditures and prevent an increase.
Still not sure what ultimatley is happening with the defeated grammar school budget, as some people had a problem with the 1% cut 100K, and want 45K of the 100k restored to it.
The mayor and council (belive it or not) discovered that they have the ability to override the voters and could reinstate the budget in its entireity if they chose to.
Apparently some council members wanted a re-vote after that was discovered.
The River Dell dissolution thing is starting to get ugly, bit of course River Edge is completely ignoring it;like it is nto even happening.
How many of us went to top schools? Did we turn out OK? Gosh, I feel terrible about the 99 other kids who are relegated to a crumby life as a result of the ‘mediocre’ high school in which they were forced to attend.
I would venture to say that the difference between a top school and a good school has more to do with the parenting than the facility or faculty. A kid who actually attends classes and does his homework in a poor school district is much more likely to get accepted to a better college than a child who performs at an average level in a ‘top’ school district. If I had the choice to do it again, I would have opted out of my ‘top’ school district to attend classes in a lower quality school district where the competition was less.
Disclaimer: From the East Brunswick High School, I finished in the top 40%. At Montclair State University, I graduated in the top 5%.
Willow – yes, I know of it, but like most things in NJ, it’s expensive. We’re thinking about Kumon instead.
Of course it makes sense to rent a bit longer, but we’re on the bottom floor of a 2 family below the loudest people you can imagine. And they’re expecting a kid in November. It’s hell NOW. We’re not waiting around for them to multiply.
#84 John It all has to do with parental involvement, period
Texan
Not sure what age your child is. Our experience was that supplementation did not solve the problem of his being stifled for the totality of the school day. My son needed to be challenged in math, in languages . . . and he could not cope with the boredom he experienced when he was ready to go further but had to wait for his classmates to catch up. You know, as an adult, you could do menial work all day and satisfy your intellect in your evening activities, but life wouldn’t be quite as satisfying and productive as it would be if you were educated and employed to your greatest potential.
And I selfishly wanted the supplementation to be the fun stuff we could do as a family. The New York area is rich in museums, historic sites, interesting neighborhoods, science resources. And I thought (and still think) that the out-of-school education should be indiosyncratic, that is, dealving deeply into the unique things that caught his interest (at one point is was sea life, at another it was anything Chinese) not bringing in someone to address his beyond-grade-level math and reading abilities with extracurricular school work.
Obviously, there are also social implications of being brighter than your classmates. In short, we opted for a private school where out kids worked at a more challenging level alongside other capable kids from families that valued education.
Snobbish? Perhaps so. The quality of public school now is not what I experienced as a child (I had my kids very late–I was in grade school in the late 50s.) I was also surprised by the depth of the reverse snobbery we experienced when we decided that we had to move our oldest, and moved the little ones with him. In the end, we felt that we had to go with the option that maximized the opportunity for our children.
Texaninexile,
Totally understand about renting. Before we bought our house, we lived in a 4 family house. The people downstairs were always having domestic disputes so the police were there quite often and next door were college guys who were okay except that they would block the driveway all the time. This situation was what prompted us to buy a house.
Startingover,
Of course you’re right. Supplementation should be a given, and it doesn’t substitute for being bored all day. But what do we do? We can’t afford both a house and private school, not if we want to help him go to college. He’s only seven, though, and he’s already bored. It worries me to think he’s already decided that school isn’t a place where he learns things, or is challenged.
Lots to think about.
#99 Stu: I agree, and I have gone from a fervent supporter of the public school system, to ambivalent. I have had kids throught eh system, the whole Blue Ribbon NJ Monthly etc.
When you look at the test scores from some of the so called best to some of the so called lesser districts, sure there are differences, in test scores, but the disparity is not as wide as you might think.
Were and the schools good for my kids, Yes, but the number reason they are doing well, is because we demanded it.
I’m surprised no one has taken exception to the way the rankings were built in that Top 1300 List:
“The number of Advanced Placement, Intl. Baccalaureate and/or Cambridge tests taken by all students at a school in 2006 divided by the number of graduating seniors”
It’s just a single metric among many that could be used, and most certainly doesn’t give a complete picture.
Welcome to NJ where every parent thinks that their children are special. All NJ children are in the gifted and talented programs. All NJ children are winners, there are no losers. Paying high property taxes is a badge of honer in NJ. My school system must be better than yours, because I pay higher taxes. Ask the NJEA and they will tell you that every school in NJ is the best. Did you know that all NJ children go on to college. 525 municipalities in NJ and every town is prestigious!
end of rant
Texan–Your post hits close to my heart. Seven was when bored to tears (literally bored to tears) hit us. I have vivid memories of my son sobbing that he just couldn’t do those “same problems over and over again.”
You can only do what you can do, and we were fortunate to have the resources to shift to private school. Don’t overlook financial aid–the private schools have more resources to assist capable kids than people think.
your “good” school districts – are sometimes the worst when it comes to accommodating the higher end of the bell curve
You are right. Often time’s good schools get their “good school” reputation based on standardized test scores. This means they give excessive attention to students with low scores, while ignoring students get the top scores. This is the most effective way to raise a schools average score, but it deprives top students from a more enriching learning experience.
I guess I didn’t figure that a university professor’s pay (plus spouse) wouldn’t be enough to afford a decent house. In most parts of the country, it is.
Most people don’t fully appreciate this when taken a seemingly high paying job in NJ. I had a coworker who moved from Jacksonville Florida to take a “good job” here in NJ. Despite the pay raise, she and her husband were living paycheck to paycheck. Last week she left to move back to Florida. Her standard of living was better there, despite the lower pay.
So lemme get this straight. If you’re bored in school, it means you’re gifted.
Is your child scoring perfectly on the problems he’s bored with? If not, maybe he should be doing those “same problems over and over again.”
Yes I fall into the camp that believes too many people think their child is brilliant.
3b Says:
June 19th, 2007 at 12:01 pm
#84 John It all has to do with parental involvement, period
I am agreeing 100% with you!!!!
I am also laughing at the lady from Texas concept of “gifted child”. I also have a seven year old who is pretty smart. She can knock off her homework 1,2,3 and get a 100 everytime. Guess what she does not cry or complain about her “boredom” or expect her mommy and daddy to drop everything for her to keep her intelectually stimulated. After she knocks off homework, she helps set the table, helps clean off the table, helps get the diapers for the infant, brings her laundry down and in her spare time draws, reads, and plays with her two sisters and dog. She likes to help the other students and if she knows something extra she will go to the board and try to help the teacher. At home she has two younger sisters and is used to being a bit ahead and she was thought manners.
My brother was super smart!!!!! I think he complained about boredom once in his life. My dad decided if he was bored he would keep him busy and after my brother shined my dads shoes, washed his car and cleaned out the basement he was no longer bored. I guess he should have called the school and complained his child was not intelectually stimulated!
I think the Texan is between a rock and a hard place, how do you prove someone is “gifted” and also when there are limited funds how do you justify taking money from the poorly performing students to help the over performing students in a public school environment. Also public schools expect parents to participate and when you are a working mother that is tough to do and it is equally tough to complain about the level of instruction when you skip a lot of activites cause you are at work. The old Catch 22!
I turned down a few of those gifted children for jobs. Last time I got one I needed him to type a report and he said it was beneath him. He did not think someone with an ivy league degree should be relegated to secretary duties. It was after 5pm and the secretary went home already and I needed it for nine am, this snot nosed kid left on me and I had to type the whole thing. I guess he needed to be stimulated!
Very interesting link I picked up over at Calculated Risk..
From Wells Capital Management:
Housing Bust Without AConsumption Bust???
Until 1998, as shown by exhibits 2 and 3, job growth dominated both consumer spending “and” housing activity. It wasn’t that housing activity was highly correlated with consumer spending because housing “drove” consumer sentiment and thus household willingness to spend. Rather, housing activity was highly correlated with consumption since both were “driven” by the same thing……jobs!
Since the mid-1990s, however, although consumption growth continues to be driven by job creation, housing activity no longer seems related to the job market. Indeed, during the 2001 recession, consumption growth slowed with job growth while housing activity continued to advance. And, even though job growth has remained healthy in the last couple years as has consumption, housing activity has failed. While exhibit 2 shows a relationship change between jobs and housing since the mid-1990s, exhibit 3 suggest no change in the historic relationship between jobs and spending.
The relationship change highlighted by these exhibits suggest the real possibility the housing market could be liquidated without destroying consumption. In the early 2000s, housing boomed while consumption growth slowed. Since mid 2005, housing activity has busted while consumption growth has remained healthy. Since consumption never shared in the early decade housing boom, why couldn’t it now escape the bust? More to the point, why did housing part company from jobs and consumption in the mid-1990s and could this split continue?
As a an alumni of a gifted and talented program, this all sounds a bit like parental anxiety to me – have any of you stopped to think that perhaps you’re indulging your kids a little too much? I don’t know, maybe NJ schools are awful with the g & t programs, maybe our stuff in NY was better. But I can say with confidence that none of the kids in my program went home and stamped our feet about boredom in the classroom just because we were “above” certain classroom work.
The gifted class was a separate learning experience for me, completely outside the realm of “real” schoolwork – we were removed for part of the school day twice a week, but were still expected to make up the lost work from our regular classes. We had a diverse program that basically ignored your usual school topics in favor of a more broad-based learning – sort of the way I imgaine a well-done home school program would be (ie, we learned about the stock market and took a trip there, did science museum trips, learned about popular culture and recent history – read and watched All the Presidents Men, for example). We also did academic enrichment, like Olympiads in different subjects (they still have those?) I also received a lot of additional education from my parents – things like trips, museums, a complete indulgence of my excessive reading habits, etc. Is NJ so different?
A realtor recently recommended that I check out New Providence. Anyone have any comments about the town?
I’m sorry. My BS detector is going off. TexaninExile shoots down Westfield schools as subpar but then claims that she can’t find anything in Westfield for $350K. Do you want to live there or not? You have been here 5 years and now you are asking for advice? I think you would know the drill on NJ by now. If you feel like venting then vent. We are all frustrated with prices but something has to be sacrificed whether it is a house, a commute or even your safety or financial comfort. People make lots of $ in the NYC-area when compared to the rest of the country. It is beyond snobbery, it is reality. I also know that many Texans feel that everything is better in Texas (“Tick-sis”). They are like New Yorkers that way. No offense to you and your Texas star child but we all are in the search for public schools for the gifted, lavender-scented streets and palaces for $350K. My suggestion is to buy a home in Plainfield and send your kid to Pingry. Seriously that is not a bad plan if top education is a concern and housing budget is minimal.
Texan,
First, what Stu said.
I don’t know how old your child is, or how much of a commute you will accept/tolerate, but if we’re talking high school, you might consider a move to Matawan and letting your child test into one of Monmouth County’s “vo-tech” schools.
I’m not kidding. The school’s are very competitive particularly Marine Science Academy and the High Tech high school.
Here’s a link
http://www.njccvts.org/monmouth_county.asp
“Yes I fall into the camp that believes too many people think their child is brilliant.”
Pooch, it’s funny you say that, because my husband came from an extremely competitive NY high school (ranked top 50 nationally on that list JB posted) where EVERY parent believed their kid was gifted. He came out of the experience believing that many of those parents were doing a great disservice to their kids because not every kid IS exceptional in the way the parents want them to be. We have both agreed that we have to work within our child’s specific talents – if the kid if gifted, great. If not, there’s nothing wrong with that. Sometimes in these “top” schools it can all be a bit much and too much of the wrong pressure on a kid – parents living vicariously and for their own prestige more so than helping a kid make the best of their own abilities. His school was nuts – his gifted program was a “let them do what they want, they’re so damn smart” kind of program. He had total freedom from schoolwork from 3rd or 4th grade on, and thinks instead of benefitting him, it made him lazier, less diligent and less conscious of the consequences of not doing his schoolwork, which came back to bite him when he hit H.S.
(PS, I’m not saying that people posting here don’t have gifted kids, just making a general point)
Also on the school thing. I’m in one of those “good” districts, but after the words of Stu, the teacher in the classroom makes all the difference in the world.
I’ve seen, good and bad in my district for both of my kids.
From Reuters:
Subprime mortgage bond index drops to record low
Bids for the main index of subprime mortgage bonds dropped to a record low on Tuesday as concerns of losses at a hedge fund and weak housing suggest a deeper downturn for the debt.
The ABX-HE BBB- 07-1 was bid at 59.24 on Tuesday, down from levels above 60 on Monday, according to dealer indications to a portfolio manager.
…
“Everyone is still pretty bearish in ABX space,” said Chris Sullivan, chief investment officer for the United Nations Federal Credit Union in New York. “Shorts are being increased, it seems.”
The fallout from poor underwriting practices and the housing slump now in its second year are expected to take a toll on markets until at least 2008, many economists predict. Rising delinquencies and foreclosures cause losses to the bondholders who receive principal and interest from homeowners’ monthly payments.
The series of ABX indexes contain bonds backed by subprime mortgages, and are used by hedge funds and other investors to hedge exposure to the market. By “shorting” the index, they bet on declines in the price while a dealer counterparty accepts the “long” position.
#82
IMHO… I would agree with you in that I don’t forsee any declines greater than 5% a year. Using your example of $500k POS decreasing to $475k, FRM at 6.35% ….would a $156.00 reduction in mortgage make you want to buy the house? I’m not really sure if that reduction would change my decision to wait.
I went through a gifted program almost exactly the same as NJGal. Overall, though, I wasn’t challenged much in school (these were probably pretty mediocre schools).
I *liked* not being challenged, but I was also really lazy. Still, I ended up with very high test scores and grades, went to a top university and now have a well paying career. I think I turned out okay even though I didn’t go to great schools.
I’m not saying a good school wouldn’t make a difference — I don’t know myself since I never experienced it — just that if your child is truly gifted, they’ll figure out a way to succeed with the right parental support.
#120 Whixh is why I think the declines may be greater and faster, because at this rate it could be years before it makes sense to buy again.
So what happens in the meantime. This could make the early 90’s look like a beautoful Spring day.
Because a 5% drop is no real drop at all, eaten up by higher rates and yearly increase in property taxes.
#82 and #120…
As the person waits and continues to rent, you must assume they are saving money and increasing the downpayment on the future mortgage. This will certainly help lower the eventual mortgage payment, even with the increase in mortgage rates, which could drop a bit when the Fed lowers interest rates to counter the potential recession. What scares me more is that Asia might stop buying our debt if the interest paid on it falls much lower. On the flip side, our dollar would strengthen making them more attractive then where our treasury bonds currently are valued. Economics minor!
From my own personal experience (i went to a highly rated public high school not in NJ and a private elementary school), I think that parental involvement is the most important thing here. Sure most of the kids i went to h.s. with went on to good colleges, but i think the ones that went on to be successful from there did so b/c of what their parents taught them. the good schools are just a way to get your foot in the door, it doesn’t guarantee success.
and i have to say, i was bored in school and never once complained about it. being able to finish my homework quickly and spend little time studying and still get As allowed me to do other things with the found time – of course, in my case this was usually reading or doing problems out of h.s. math textbooks when i was in elementary school, but you get my point.
“I went through a gifted program almost exactly the same as NJGal. Overall, though, I wasn’t challenged much in school (these were probably pretty mediocre schools).”
I should add I went to Catholic school – not exactly fancy private school, but pretty decent as Catholic schools go.
And I agree – parents make all the difference. School is ALWAYS boring – it’s a rare kid that says “Gee, that algebra lesson was AWESOME!”
Re #43,
Texanin exile,
If you have only one kid, I would suggest looking in livingston for a 3 bedroom cape, colonial, split or ranch. You can find older, smaller homes there from $350-500,000 and the schools are among the best in the State.
#123 Stu: true but it just may not be all that compelling to buy, without at least a relatively swift decline in prices.
What I find delusional is what people here (in NJ) take as givens; among others – commuting long distance just to afford a house? I’ve got a kid I like to spend time with. I guess I didn’t figure that a university professor’s pay (plus spouse) wouldn’t be enough to afford a decent house. In most parts of the country, it is.
Actually the tenure track professor before he is tenured gets crappy pay in every part of the country and can not afford decent house.
Professorship is not what is used to be 30 years ago. thats not wher decent pay is, and a lot of stress – say thank you to postdoctoral immigrants – like myself.
Foreighners greatly eroded US scientists pay levels with respect to other professions in the last 20 years.
If in 1970’s tenuire track professor was making close to MD salary – now it is half of that.
look at them yields dropping like a rock. the ‘big scare’ was nothing but.
Foreclosures drift to Sun Belt from Rust Belt
A new survey shows foreclosure clusters are on the move from industrial centers to coastal and southern states.
By Les Christie, CNNMoney.com staff writer
June 19 2007: 1:28 PM EDT
NEW YORK (CNNMoney.com) — For sheer volume, housing foreclosures across the nation appear to be moving from the Rust Belt to the Sun Belt.
The geographic shift shows up in the mix of properties listed by the auction web site RealtyBid.com, which mainly features foreclosed homes.
RealtyBid spokeswoman, Daphne Shannon, said, “The Midwest has always been very solid for us, but the properties we’re seeing are moving across the country – they’re from California, Arizona and Nevada.”
The number one ZIP code in the nation for foreclosures is still, however, in the Rust Belt. It’s Cleveland, 44105, with a total of 784 filings during the three months ended June 15, according to the RealtyTrac study.
The hardest hit ZIP in California was Sacramento, 95823, where there were 634 default notices, repossessions and auction notices. It had the sixth most foreclosure filings for any zip code in the nation.
California boasts a vibrant economy and a fast growing population. According to Doug Duncan, chief economist for the Mortgage Bankers Association (MBA), foreclosures, overwhelmingly, used to come courtesy of serious underlying economic problems such as job layoffs or plant closings.
But the California foreclosure spike, as well as those in Florida, Arizona and Nevada, was set up by runaway appreciation that boosted home prices beyond affordability.
Double-digit price increases had attracted hordes of investors, who added to swiftly rising values. Developers bid up land prices in a scramble to get product to market. When markets cooled, speculators added to downward price pressure by unloading their properties onto already lengthening inventories.
“In many of these markets,” said Duncan, “prices fell below what investors paid. Many have simply walked into their banks’ offices and handed in their keys.”
Many Sun-Belt buyers bought their high-priced houses using 2/28 adjustable rate mortgages (ARMs) which featured very low initial, or “teaser,” rates that reset much higher after the first two years of fixed payments.
But ARMs are best used, according to Duncan, as credit-repair products. They’re set up for borrowers to show they can keep up mortgage payments and then refinance out into affordable fixed-rate loans after two years.
Many buyers used ARMs to get into a house with little regard for whether they could afford the payments, betting that rising prices could build enough home equity they could tap for cash.
When prices stabilized or fell, that safety valve disappeared. Owners couldn’t pay monthly bills, and they had no equity to draw on.
In the Rust Belt, it was the ripple effects of a dying industrial economy instead of rampant speculation that crushed the finances of many borrowers in states like Michigan, Ohio and Indiana.
Neighborhoods of Cleveland 44105 were once filled with Eastern European immigrants and their descendents. Residents worked in nearby woolen factories and steel mills.
Today it’s a mixed-race area with lower than average income, higher than average unemployment and a large stock of older, single-family homes. Many of them sell for less than $100,000, some for under $30,000.
According to Cleveland city councilman, Tony Branchatelli, who represents the district, more than 600 homes in the neighborhood are vacant and boarded up. Many have little value because the rehabilitation costs would exceed their selling prices. Some have had their plumbing, wiring and other hardware stripped.
In Sacramento, 95823, by contrast, residents depend more on government jobs and service industries for employment, although wages are still below average for the state.
Homes there are more modern and more valuable than in 44105; even modest three-bed/two bath houses go for several hundred thousand dollars.
Neither the Rust Belt nor Sun Belt are likely to see easier conditions any time soon. In the Sun Belt, the subprime mortgage mess will take many months to work through as the many borrowers who took out 2/28 and 3/27 ARMs during 2005 and 2006 will hit their reset points this year and next.
And the rust belt appears likely to endure more economic trouble before conditions turn around in heavy industry.
“Delinquencies,” said Duncan, “will probably peak by the end of the year and foreclosures in 2008
Foreclosures: Hardest hit zip codes in New Jersey
Zip Code City State Default Notices Auction Notices Bank Repossessions Total Foreclosure Filing
08081 Sicklerville NJ 199 20 16 235
07060 Plainfield NJ 172 5 4 181
08527 Jackson NJ 158 11 12 181
08753 Toms River NJ 161 9 11 181
07111 Irvington NJ 118 43 0 161
I have a simple solution for kids who are bored in school that costs almost nothing:
a library card
#123
Stu that’s also a good point. Along those lines with “assuming” they are saving money…how many ppl do you think actually saved the extra money when they refi or spent it on something else?
Since we (at least I do if for only entertainment purposes) value opposing views. I think everyone will agree that the mantra…”RE only goes up”…is pure BS. RE just like other industries are cyclical and I don’t think its on the upside right now.
What do you see as the potential downside of waiting until next year or later to purchase a house?
The one that comes to mind would be an increase in rates some what negating the decrease in prices.
I just wanted to give my thoughts on the “too bored for homework” issue.
When I was in grade school, I had among the top standardized test scores in the class. My skills, especially in reading/verbal area, were well beyond my grade level.
I, however, was a lazy kid. I hated doing homework. To me it was torture. I just wanted to go outside & play street hockey, football or ride bikes with my friends. In my early elementary school years, this put me squarely in the “B”/”C” grade range. I did well enough in the classroom & on tests to make up for the missing homework, which kept me from flunking.
As “B”/”C” student with the kind of test scores I had, some alarm bells were raised with the teachers. With my scores, I should be excelling. They called my parents in. The teachers, along with a child development expert, postulated that I wasn’t being challenged & stimulated enough & that would explain my lackluster grades. Of course, I opportunistically jumped right on the bandwagon. “Yea, I wasn’t being challenged…that’s the ticket. Now can I go ride bikes with Nick”?.
My parents didn’t buy it
I got the belt
I started doing my homework
Maybe this type of therapy would help.
OT–
I am looking to buy a new car in the next month or so. I am wondering whether I should jump on any low % financing deals that are out there right now given the liklihood that rates may go up by next month. Is this a bad idea?
RE Newsweeks top 1300 school list.
The list is put together in a way that differs from many others, specifically in an attempt to distinguish schools in poorer neighbourhoods that do a fantastic job with the student pool they get and to eliminate some of the advantage of rich school districts who get the bonus of kids with parents who will do anything to get them through.
They also give extra points to schools which offer AP and Bacc. courses to a large number of kids in order to challange them, whether they pass or not. The point being that many “top” schools maintain that position by fudging their numbers – by only allowing the top kids to take certain tests so that their average scores remain high.
Of course, schools from rich districts make it through still, but it is a stinging indictment to schools which make themselves look good at the expense of offering opportunities to all of its students as they drop down the list considerably.
I think we all know of districts like this.
Renting, you sound like my husband – exceptional test scores but hated school so lower grades – it drove his parents to distraction, as well as his teachers and guidance counselors – that’s when the kid hears the “but we KNOW you can do better” mantra. You’re lucky your parents succeeded in getting you in line!
lisoosh, 135:
“They also give extra points to schools which offer AP and Bacc. courses to a large number of kids in order to challange them, whether they pass or not.”
Not extra points, the ONLY points. The only ranking measurement they use is “the number of Advanced Placement, Intl. Baccalaureate and/or Cambridge tests taken by all students at a school in 2006 divided by the number of graduating seniors.”
That’s it.
I don’t think it can be any kind of stinging indictment since it’s only a vague measurement at best.
#134
http://www.leasetrader.com
You’ll save on the DP, short term commitment, and most of the time you can get an incentive.
Why would you want to buy a car and own a depreciating asset. It’s like owning a house in a depreciating market wouldn’t you rather rent.
I will never buy a car again in my life and you can forget about financing an asset that depreciates 10%-15% per year.
FYI – My school when I graduated was number one on the Newsday list. Many reasons had nothing to do with the teachers. My school sent the most kids to Ivy League schools of any HS public or private. Guess what in a rich town everyone accepted to an expensive school can attend , very high SAT scores – several perfect scores, guess what in a rich town everyone had a SAT tutor and we had free SAT review classes. Finally, school pushed low performers into Voc or BOCEs HS and expelled poorly behaved students over 16 even though they were public. Well you don’t want those kids messing up your rating. My favorite was my friend who was a b student got accepted to their AP program based on his PSATs and got all A grades for the same work that got him a B in the regular program. When he asked they told him that now that he is gifted he has to get an A!!!! Overall, a pretty lousy school for number one in the country. Any catholic high school even in the Bronx, could have provided twice the education, but hey those kids can’t all afford the tuition at Harvard so I guess they won’t make the rating
Ok, can someone please explain “Intl. Baccalaureate”? My town’s “top ranked” public h.s. sang their own praises for these classes – and yet everyone I knew who took them was unimpressed – even the parents were. How are they different from AP (which it seems everyone has)?
#140 – my only knowledge of IB is that in some areas of the country, they don’t offer AP they only offer IB. That doesn’t really answer your question, but I’ve had it explained to me that it’s like the SAT and the ACT – different tests to sort of test the same thing.
My friend in Mamaroneck revotes today on his towns defeated school budget. In their town if a budget is defeated, it is revised,and the residents get to revote, as opposed to the PRNJ.
Anyhow he sent me s one page piece that supporters of the budget were passing out at the train station this morning. This was a printed comment from a supporter of the budget:
” A homeowner could pay a 6% school tax increase for 92 years before they would break even with the depreciation caused by a 5% drop in the value of their home.”
Now there you go, this is what passes for logic from an affluent highly educated minutes from NYC town in Westchester.
Make,
Not a fan of leasing– but thanks for the ling. I don’t like the mileage limits and I plan on keeping any new car I get for at least 6 yrs. I prefer to not have car payments as much as possible.
There is a top rated elementary school (small district that feeds a regional high school) that seems to classify as many kids as possible so they have modifications when taking tests. They want to keep their 98-100% proficiency scores and this is how they do it. In other districts, parents have to fight tooth and nail to get their kids the help they need but in this district, it’s easy to get your kid classified.
Off topic but interesting. I was cleaning up not too long ago and found a real estate magazine from march 2001. I nearly died.
Joeycasz,
You might as well bury it as a time capule.
Why would you want to buy a car and own a depreciating asset. It’s like owning a house in a depreciating market wouldn’t you rather rent.
There is a difference between renting and leasing.
With renting, you are paying for the right to utilize someone else’s property
With leasing, you are paying rent plus paying for depreciation.
Think of renting a house in a depreciating market, where you had to pay to rent the house plus pay the owner for any value the home loses. This is what happens when you lease a car.
You are definitely better off buying a car and driving it for a very long time. The benefit really comes in the out years, when the rate of depreciation slows down.
anyone have the address for 2412920 (montville)? I swear that i remember seeing this for sale maybe last year, and wanted to look it up. thanks.
skep-tic,
I just bought a car this past weekend. My credit union only updates their rates once a month, so I got the June 1st rate. This allowed me to get a lower APR & take the cash back option.
Home Depot Agrees to Sell
Supply Unit for $10 Billion
Three Private-Equity Firms to Take Equal Stakes
By ANN ZIMMERMAN and DENNIS BERMAN
June 19, 2007 2:30 p.m.
A trio of investors agreed to buy Home Depot Inc.’s wholesale construction supply business for a tad more than $10 billion, according to people close to the deal.
The investors are Bain Capital LLC, Carlyle Group L.P. and Clayton, Dubilier & Rice Inc., which will each have a one-third stake in the business. A Home Depot spokesman declined to comment on the deal.
You are definitely better off buying a car and driving it for a very long time. The benefit really comes in the out years, when the rate of depreciation slows down.
Have to agree here. Over the years, you will be much better buying. Leasing is a by-product of our materialistic, must-have-it-now society.
In fact, the most financially sound thing to do is buy a slightly used car, about 3 yeas old, and drive it till it dies. Cars depreciate the most in the first few years. Let the previous owner sucker get hit with that.
I remember when I bought my first car as a teen, 100k miles was considered the rule-of-thumb life of a car. These days, you can reasonably get double that from late model japanese and korean makes as well as german luxury lines.
renting,
You can a $50,000 car for $500-$550 per month.
You assume this lease for one year.
Return on 50K @5% is $210 per month. So it’s really costing you $300 or so dollars to lease this car.
300×12=$3600+$500 to purchase an additional 3,333 miles (@.15 per mile) total cost of leasing is $4100.
Do you know of any 50K cars that don’t depriciate more than 4K per year.
Skep, go with a credit union, if you have affiliation to one. Banks and online sites have higher rates.
The only lower rate might be when a manufacturer offers a special rate to move certain models. If the manufacturer’s finance arm is offering a rebate IF you finance with them, finance through them to get the rebate even though the APR will be high, and refinance immediately. Make sure there are no pre-payment penalties though.
Borrowing money to pay for a depreciating asset makes no sense whatsover. But if pride of ownership is important then by any means go right ahead.
OK, lots of districts use the “when in doubt, classify” method of pumping up test scores and/or getting test modifications.
I don’t have it in front of me, but see how many kids in Rumson’s schools are classifided sometime.
Leasing is a terrible option in most cases.
For example, I purchased my first car, a 1995 Honda Civic for $14,000 complete in 1995. I put down $5,000 and financed the $9,000 remaining at $200 (5% interest, still readily available as an incentive) per month for 48 months. Outside of insurance and the standard maintenance (still on my first clutch), I have been driving for the past 8 years without a car payment. I still get > 40 MPG too and the car now has 130,000 miles.
Now how could a lease work out better?
The 36 month lease would have been $319/month with no money down.
So at the end of three years lease I’ve spent $11,484. At the end of 3 years of loan payments I’ve spent $12,200. The buyout would have been $5500 on the lease. I spend $2400 (one more year of loan payments) and the car is mine and there were no mileage limitations nor did I have to worry about dings and scratches.
The reason I present this example is because most people lease and it is a terrible waste of money. But if you don’t have a downpayment then you end up spending on average double per month to drive a car. Sort of like refinancing every 3 years and never paying any principle on your mortgage, just interest.
The whole leasing thing irks me to no end because so many people are fooled!
For the best deal, heed the advice of others here and purchase one of those cars that just came off of the lease. I my example above, you could have probably gotten it for $2,000 down with a $125 monthly payment for 4 years.
Skep,
Can’t you wait a couple of months?
September/October all the dealers are looking to unload and there is always some kind of financing on the table.
I’m just finishing up paying for my Civic and I think my loan rate was something like 2.9%.
Strangely enough, the price on my 2002 Civic was $13,400.
I don’t drive alot so five years in I’ve got on 40K miles on it.
In four years my daughter will probably get it when she gets here license.
My goodness, what is up with all of the chatter over Westfield? Does everyone here live in Westfield?
A few points:
For good schools, I wouldn’t look outside of northern Bergen County. I would look at Tenafly and Cresskill. They are ranked as the best. Leonia also has decent schools and their homes are significantly cheaper. As far as Texan finding a decent home in these towns for under $400,000, that is not going to happen. I recommend looking at condos instead.
#159 Lots of “decent homes” listed in the low 400’s now in decent towns,and sitting.
Stu,
Who really wants to drive the same car for eight years and why would you want to pay interest to build equity on a depreciating asset.
$320 per month for a Honda Civic you got raped. Check this out with an open mind.
http://www.leasetrader.com/auto/lease/search/2006_Cadillac_CTS_2.8L_Sedan_114400.xhtml
Stu,
Good move! Drive the car until the doors fall off. I have a 1998 Honda CRV; payed for it a loooong time ago and will drive it until the engine dries up and blows away.
I like the pretenders in their Mercedes and BMWs, they make me chuckle.
In 2005 I paid $17,000 cash for a nearly flawless, low mileage 1999 BMW 528i that cost over $46,000 new. However, I also know cars pretty well so if I can’t fix it myself (brakes, oil change, minor electrical things) and take it to a shop I can call BS on them if they try any funny business (google “$6500 mercedes sunroof” for an example).
Many people are clueless about the workings of cars, therefore feel justified paying a large premium for a new or leased car with a warrantee.
Personally I’d drive a nicer car with a few miles on it, and ask a co-worker/friend/father to accompany them to the shop…
Kurt
Borrowing money to pay for a depreciating asset makes no sense whatsover. But if pride of ownership is important then by any means go right ahead.
Make,
When you lease, you are paying pay for depreciation. Also, because you are leasing a new car, you are paying the hefty depreciation that occurs up front. A lease payment is made up of three components:
1 Depreciation – the amount the car loses in value
2 Finance Fee – the “rent payment” or profit for the leasing company
3 Sales Tax
You are right about borrowing for a depreciating asset. Leasing, however, is usually worse. Ideally, as pigpen points out, your best bet would be to buy a used car for cash. Let the first buyer bare the brunt of the depreciation.
The car has plenty of miles available for you to drive @1,286 per month. This car cost around 30K.
Take your 30K and put it in your savings account. You will net $135 in interest which will lower your lease pmnt to $175 per month to drive a Cadilac with all the bells and whistles all while under waranty.
Is anyone still in belief that you should own this cadilac?
Don’t forget at the end of this lease you have your 30K still in your savings account.
Gary said “I like the pretenders in their Mercedes and BMWs, they make me chuckle.”
Take that back, we’re not all pretenders! :)
Kurt
’99 528 I’ll drive to the ground
’86 Honda CRXSi for sunny days
So it’s obvious that ‘make money’ works for leasetrader or is selling a car there.
And to feed the troll, which goes against my better judgement:
I’ve paid $101.12 per month to drive my Civic. It’s now less than 1/3 of what you will pay every month on a lease for a $14000 car and will probably be down to 1/4 in another few years (knock on wood).
Kurt,
Except you, you’re not a pretender.. all the rest, though. :)
Ideally, as pigpen points out, your best bet would be to buy a used car for cash. Let the first buyer bare the brunt of the depreciation.
I was refering to leasing used cars as well. Let someone else pay for the inception fees and DP. You get the benefit of low monthly pmnt and short term obligation.
Make – Have you actually used leasetrader.com. Ive looked at it, and there are some really good deals on it. But Im skeptical of the site for some reason. Im curious as to your feedback of the site if youve assumed a lease through it.
“And to feed the troll, which goes against my better judgement:”
What? Is there another troll on this site? I thought I had a monopoly. How dare he invade my turf…
Gary said “I like the pretenders in their Mercedes and BMWs, they make me chuckle.”
I’m not a pretender and I don’t work for lease trader. My brother got the same car I got and I’m paying &400 per month more than he is and I had to come up with 10K to walk out the dealer and he got a 2k incentive. I mentioned this before on this site.
#146 bystander: And dig it up next year.
Gary – but people like make money who buy (more often lease) new cars are needed so that us non-pretenders can buy them for .25cents on the dollar 5 years down the line :)
A friend of a friend is stuck paying $520/mnth for the next 4 years on a HYUNDAI of all things… fools and their money…
Kurt
“Is anyone still in belief that you should own this cadilac?”
I’m not of the belief that you should own, lase, rent, or for that matter drive ANY Cadillac.
Kurt
#174 – the leases on Hyundais are surprisingly expensive. My mother leases cars – mainly b/c she drives 2 miles each way to work and always likes to have something new – and was looking into something less expensive than her Accord. She was shocked at how pricey Hyundais were. I’m guessing they depreciate very quickly, but I really know nothing about Hyundais.
I’ll be driving my 2001 Civic (which costs me $0/month) until it no longer wants to be driven. After that, I’ll probably just get another Civic.
$8000+ to drive a car for 27 months is ludicrous. My priority is to retire young. This car will certainly not help me to obtain my goal. I’ll buy my Caddy in 10 years on interest income from my investments.
176: “the leases on Hyundais are surprisingly expensive.”
Supposedly she bought the car! Financed over 4 years @ $525/mnth = $25k total.
Talk about being upside down…
Don’t know what model it is but I can’t even fathom a 25k Hyundai. Then again I’m out of touch with new car (and real estate) prices.
exile (43)-
Welcome to NJ. Get on 78 and start driving West. Don’t get off before Exit 26.
#178 – actually, i forget the model names, but there are a couple of hyundais that are pretty expensive – and by that i mean they are > $30k. to me, for a hyundai, that’s expensive.
Plankton,
My brother did and it was easy. It takes about a week for it to happen from begging to end as oppose to one day at the dealer.
According to him it was easy. He had to mail in his credit application and wait 2 days to get approved. That’s all. When my lease is up I will definitively assume a lease. I heard swapalease also has good deals.
Stu,
If $175 per month is going to be the difference between you and your retirement then my friend you are on some sort of medication and you need to check the expiration date.
that big (57)-
Go to the County Clerk’s office and check the mortgage books. Unless it’s a private loan, the mortgage(s) will be recorded.
I think leasing is fine if you are one of those people who likes to have a new car every couple of years, particularly if you want an expensive new car every couple of years.
I am in the market for a relatively cheap car (under $25k) that I can finance at below market rates and keep for a long time.
I see that Subaru is offering 1.9% financing until the end of the month for 24 months. I think Honda is offering 2.9%.
I know that there are typically the best deals toward the end of the summer. I can wait, but I wonder whether rates will go up by then, making such deals harder to come by.
#174 – the leases on Hyundais are surprisingly expensive
On a lease, you are paying for expected depreciation over the term of the lease. Hyundais don’t do so well here, so you pay a lot in depreciation.
If you are going to lease, you should find a car that holds its value well. Toyotas do well and BMW’s do even better.
Am a part of the Honda CRV club too. Bought it new in 05 (would have bought a used one, but the 05s came with 5 speed and stability control) , its paid off, and plan to drive it a long time. It’s got 30K miles now and feels practically new. So hopefully another 10 years of driving with no car payments.
New Hyundai’s are a waste of money, even after incentives, since they depreciate like crazy. That could explain the expensive leases. I bought a used 04 for my 100 mile daily commute for 60% off dealer invoice 6 months back. I’ve had no problems in the 12,000 miles I have put on the past six months, get great gas mileage and don’t care about the resale value since I would have gotten a lot of miles out of it by the time I junk it.
Leasing is a waste of money, unless you want to keep up with the Joneses.
Thanks make. It’s something to consider in the future if leasing makes sense for me.
#185 – not sure if you were directing your response to me specifically, but trust me, i don’t lease. i will drive my Civic into the ground.
“Go to the County Clerk’s office and check the mortgage books. Unless it’s a private loan, the mortgage(s) will be recorded.”
I’m trying to find out what a home sold for a few months ago, and the Recorder of Deeds directed me to their web page. If you have the buyer’s or seller’s name you can find out the mortgage amount, but I don’t know how to go about getting this. Any suggestions?
thanks!
Kurt
Tex (83)-
“What I find delusional is what people here (in NJ) take as givens; among others – commuting long distance just to afford a house?”
What I find delusional is a state that elects an inbred alcoholic as governor and executes people faster than Frank Perdue whacks chickens. Of course, there are days now and then here in NJ when I wish I could hang a gun rack with a shiny 30-.06 in my rear window.
Also delusional is any state whose definition of “barbecue” substitutes beef for pork.
500 Top Foreclosure Zip Codes
Wow, that whole Miami greater area is really getting hit bad. Las Vegas looks close behind. You can sort by hitting the “column” heading.
NJ Cities: Sicklerville, Plainfield, Jackson, Tom’s River, Irvington
http://money.cnn.com/2007/06/19/real_estate/500_top_foreclosure_zip_codes/index.htm
skep-tic
Look at this and tell me you’d still buy a car. Under $200 a month for a 25K vehicle.
2000 miles per month.
There is something for every budget. Not trying to beat a dead horse here but 25K in savings collects $100 per month in interest.
Which inturn cost you $97 dollars a month to drive this truck. With no maintance as it’s under warranty. That’s $3.00 per day.
If you think that this is expensive and you would rather drive a old civic then you’re just being irrational.
skep-tic
Look at this and tell me you’d still buy a car. Under $200 a month for a 25K vehicle.
2000 miles per month.
There is something for every budget. Not trying to beat a dead horse here but 25K in savings collects $100 per month in interest.
Which inturn cost you $97 dollars a month to drive this truck. With no maintance as it’s under warranty. That’s $3.00 per day.
If you think that this is expensive and you would rather drive a old civic then you’re just being irrational.
http://www.leasetrader.com/auto/lease/search/2006_Buick_Rendevouz_CX_Fwd_4dr_SUV_114333.xhtml
Stu (99)-
Hear, hear! All these “top schools” lists are garbage. They mean nothing and are directed at anxious parents who want to think they’re doing right by their kids.
If a schools’s classes and programs won’t work for YOUR child, guess what? Some arbitrary “rank” won’t make things any better.
I troll…..hya hyah hyaa
NO REBOUND NO HOPE 2008.
BAD NEWS GRUBBING BUNCH.
HEHEHEHEHE
County clerk has all the mortgage info on the Show & Tellers. You can see who is for real or not.
It’s amazing how indebted many have become.
Constant refi’s heloc loans and when the loan increases by 125%. Fun to target a few of these bagholders. Then you can see past the game face.
hehehehehe
By the way I know several people who make seven figures and they buy their used cars on ebay or auction as it makes no sense to buy new or even used at a dealer. That is for the upper middle class posing as rich. Two guys I know showed up at party I went to recently in old american cars and they made nine figure salaries, 175 million and 225 million last year and one of them lives in a 60 by 100 split. I got heavily harrased by them when I showed up in my wife monster GMC about the waste to buy a new show off car and the low mpg. Next year I take the station car or my old firebird. I learned my lesson that only poor people drive new cars and even poorer ones lease them.
FYI I still drive a 1967 Firebird covert that I bought in 1981 for $900 every summer that is worth 15k . Best deal going and only $100 a year insurance.
Bystander (115)-
House in Plainfield, school at Pingry. One of the 10 best things I’ve ever read here! And…a completely do-able plan of action.
I have never- repeat NEVER- had a client choose school over house the entire time I’ve sold RE in New Jersey. When push comes to shove, North Av in Westfield, a POS cape in Millburn, etc. get tossed out the window, as the buyer heads toward Hunterdon, Warren or Sussex Co to get a nicer home.
Another observation – Honda never offers direct customer rebates. They might offer manufacturer to dealer incentives to push certain models like they are currently doing on the Accord now at the end of the model year. Direct customer rebates affect resale value directly dollar for dollar. Instead, Honda earmarks that money not used on rebates towards their finance subsidiary and ‘subsidizes’ the finance rates offered. That way, Honda keep resale values high, indirectly lowering leasing costs for the consumer. And buyers know they have a car that will not depreciate rapidly due to the perception of reliability and no rebates. Talk about nurturing a brand…..
Isn’t it ironical to spend $500 million on commercials to attract people into a dealership, and another $500 million in rebates to get people to actually buy the cars?
#193, make money, you’re comparing apples to oranges.
Do the math on the amount of gas you put in your car each month. The spread in outlay for gas costs between a Buick Rendezvous and Honda Civic will almost let you drive the Civic free, especially someone driving a lot.
Before you buy any car you need to know the residual value. Leasing or buying, there are lots of cars that look “cheaper” unless you factor in residual/resale. I am a cheapskate who is moderately handy, so I buy used… I mean pre-owned.
Clotpoll, that is righteous. A New Jerseyite holding court on the right way to fix barbecue. Get back to your brick oven pizza and strip mall sushi.
Rob (202)-
I grew up in Memphis. I know barbecue. I mean, KNOW barbecue.
texan…i know others might think i say this a lot on here, but try Nutley…nice town, can still find some decent stuff in the low $400s, good schools, close to parkways, close to Montclair, close to city…
Beg pardon. I am more partial to pork barbecue myself. But I got to love the beef brisket when I lived in Dallas.
#203 Clot Any time I was in Memphis I always stopped in at Corky’s; never disappointed.
3194 Clot Or perhaps they are geared at parents who feel if they choose the right school, they won’t have to do anything more for their kids;like check homework etc.
All the talk about gifted students made me think of this school on LI:
http://www.lisg.org/
I went to h.s. with a “graduate.” And she was truly bizarre (2 years ahead of herself academically, about 8 years behind socially). Sometimes it’s way more beneficial to a gifted kid to be around other kids who might not be so gifted – it’s a little more “real life” than a place like this.
In New Jersey brisket is to be cooked like a potroast and served for passover dinner — or stacked high in a nice “samwish” in a good Kosher-style (that means not really kosher) deli (if there are still any; there used to be Tabatchnick’s and Eppes Essen, but I don’t know if they still exist).
RentinginNJ #133: Are we the same person? Aside from the belt, that sounds like my childhood. I grew up in the Mountainside and Westfield school districts. Granted, this was in the 1960’s, but still — because I knew how to read already when I entered school, they didn’t know what to do with me. School was easy-peasy in the early grades and I learned how to get lazy. Then, in high school, when I had to take REALLY difficult stuff like chemistry and algebra, and learned that there WERE in fact kids who were smarter than I was, I had a lot of trouble coping with that.
If you don’t keep kids challenged, they get lazy. I didn’t get into any of the better colleges as a result. I had an inferiority complex about school till grad school, where I got my master’s in MIS with a 3.8 GPA — but in grad school, no one cares what your GPA was.
From the WSJ:
Merrill to Dump Bear Fund’s Assets
By KATE KELLY
June 19, 2007 5:15 p.m.
A day after managers of a troubled internal hedge fund at Bear Stearns Cos. presented lenders with a last-ditch plan to reinvigorate the fund with additional financing, creditor Merrill Lynch & Co. pushed forward with plans to sell hundreds of millions of dollars in collateral assets out of the fund, said traders late Tuesday.
Merrill has indicated plans to sell off at least $850 million worth of collateral assets, mostly mortgage-related securities, Wednesday afternoon, according to documents reviewed by the Wall Street Journal. Those plans come amid efforts by the Bear fund managers to stave off liquidation by lining up $1.5 billion in new credit from parent company Bear Stearns and an additional $500 million in new equity capital. The managers spent Tuesday trying to finalize those financing arrangements.
An auction Wednesday could come as a blow to the fund, known as the High-Grade Structured Credit Strategies Enhanced Leverage Fund, because it could spur additional sales of collateral assets from other worried dealers. A string of asset seizures would likely force the dissolution of the fund, and could effectively drag down the prices of similar securities in the market, creating losses at other Wall Street firms. On the other hand, a handful of successful trades might still pull the troubled fund out of harm’s way, and Merrill could yet change its plans, as it has done once before.
Texan:
Nutley may be a good idea, commute is southbound on GSP…much nicer than going north in am. MSU is very close
What do people think of Weehawken?
NJ Monthly’s school ranking for Weehawken: 109 out of 316.
Best commute from New Jersey to midtown Manhattan.
Not a McMansion sprawl suburb with snobs. More of an urban feel.
self-ban in effect. I’ve fooled you all, I’m actually a troll masquerading as a gnoll pup.
From Reuters:
Homes prices most at risk in once-hot markets
U.S. housing markets that saw big, rapid increases in home prices in recent years and more recently have seen those gains ease are at the highest risk for price declines over the next two years, according to a report released on Tuesday.
“What the markets with the greatest risk of decline have in common is a history of price volatility: rapidly rising rates of price appreciation above the long-term average followed by a recent sharp slowdown in the rate of appreciation,” said Mark Milner, chief risk officer of The PMI Group Inc. (PMI.N: Quote, Profile, Research) unit PMI Mortgage Insurance Co., which released the report.
“Markets with a history of volatility are more likely to see price declines in the future,” Milner added.
Markets most at risk of falling home values are Riverside, California, and Phoenix, Las Vegas and West Palm Beach, Florida, according to the report based on PMI’s Market Risk Index. Each has a 60 percent or greater chance its home prices will drop in two years.
Nine of 11 housing markets with a greater than 50 percent chance of price declines are in California and Florida. The remaining two are Boston and Washington.
Milner said he expects home prices across most of the United States to be flat over the near term.
“There is a one in three chance they will be lower two years from now,” Milner told Reuters. “Broadly saying home price appreciation is going to be flat for a while is not out of line.”
213
I doubt anyone noticed.
From the PMI Group:
http://www.pmi-us.com/media/pdf/products_services/eret/pmi_eret07v2s.pdf
pretorius Says:
June 19th, 2007 at 5:43 pm
What do people think of Weehawken?
NJ Monthly’s school ranking for Weehawken: 109 out of 316.
Best commute from New Jersey to midtown Manhattan.
Not a McMansion sprawl suburb with snobs. More of an urban feel.
Pret-a-Porter: Bizarre town that is Jekyll & Hyde. Note: really poor air quality due to location above Lincoln Tunnel.
#113
As a G&T teacher, these are the kinds of things I do in my program. In NJ, G&T is mandated, but non-funded. Technically it’s under the special ed. umbrella, but receives none of the funding. I choose to focus on broadening the experiences of children & exposing them to skills they’ll need in life like long-term planning, problem-solving & understanding others. We have fun with contests & challenging units. It’s important for these higher-achieving students to have a place where they can be themselves where learning is not just a challenge, but enjoyable. I encourage a love of learning and reinforce that there is SO much to learn. If a child is bored, then they need to learn to find opportunities to learn, not wait for someone to hand them something to do. I do have to say, however, that my students *are* challenged in their “regular” classes because most of them really care about learning & doing well. THAT is due to the parents NOT the g & t program.
I would also, Texaninexile, look into the Caldwell/Roseland area. Also if there is anything in the price range Montclair has g&t schools as they operate as a magnet district.
Clotpoll Says: “Also delusional is any state whose definition of “barbecue” substitutes beef for pork.”
I totally agree–but even crazier is what people around here consider bbq, hamburgers and hotdogs on the grill. I always thought that was a cookout? I had some Carolina style pulled pig (vinegar sauce) this past weekend at Crook’s Corner in Chapel Hill. I still prefer Memphis style.
Rachel
Re: Weehawken
If you have kids then I would definitely stick with the suburbs. If you don’t have kids, then it is a good place to live. Prices vary A LOT. If you are on River Road (Port Imperial), prices for new construction, like Henley on the Hudson, are very expensive. If you go up the hill on Blvd. East, prices are cheaper and most of the inventory consists of single and multi-family houses.
220,
“If you have kids then I would definitely stick with the suburbs”
Why?
“Why?”
You just answered your own question below:
“NJ Monthly’s school ranking for Weehawken: 109 out of 316”
Wouldn’t you rather send your kids to a suburban school like Tenafly that was ranked #2 out of 316?
222,
Maybe. However, consider the schools ranked 108 and 110, Manasquan and Shawnee. Both are upper middle class suburbs. Weehawken would rank in the middle of the Bergen County table, and Bergen County is overwhelmingly suburban and has super public schools.
Seems like Weehawken performs in line with the suburbs, but unlike the suburbs is convenient to Manhattan, an attribute which I value highly.
NJGal,
re:International Baccalaureate
IB is essentially a diploma program (as in high school diploma) that is recognized internationally. In other words, if you have your IB diploma, it is recognized as the equivalent of a HS diploma in most universities around the world.
Academically, the classes are about equivalent to AP classes.
Back when I took it, you were required to take 3 “higher level” courses, which generally constituted 2 years of study (i.e. like 2 years of AP), and 3″lower level” courses, which were typically 1 year of AP level courses.
In addition to this, you were required to write an extended essay in one of your “tracks” your senior year, and participate in some form of extra curricular activity during your entire IB period (junior & senior years) which was approved by your IB coordinator.
You were also required to take one semester of Theory of Knowledge (Epistemology).
http://en.wikipedia.org/wiki/Epistemology
You were required to take exams in all of your “tracks”, each of which was sent to a grader elsewhere for scoring. Scores were 1-7 (7 being best).
You needed to total 24 points in order to obtain your diploma. You could also receive -1, 0, or +1 for both your extended essay and your Theory of Knowledge exam score.
The program may have changed since I took it.
http://www.ibo.org/
JB,
226 is in awaiting moderation.
Ok, I have to go on one of my “troll” rants for a minute so please excuse me JB…
Weehawken performing in line with suburban schools? You have to be kidding me. Hudson County public schools are some of the worst in the state. If you want to be selfish and send your kid to a bad school just so you could be close to the city, go right ahead. But when it comes time to going to college, just remeber that there are plenty of open seats at the community colleges and the University of Phoenix.
And I really could not care less about Manasquan and Shawnee. I look at the best of the best, which are Tenafly, Cresskill, and Northern Valley Regional (Demarest and Closter). Weehawken is only good if you are buying a condo and do not have kids. I live in a horrible school district, but buyers are purchasing $1 million + luxury condos every month. And those with McMansions send their kids to private schools.
Does someone have a link to the NJ Monthly “rankings”? I’d like to know what their methodology was. We seem to have picked apart the Newsweek ranking, but have said little about the methodology behind others.
jb
NJ Monthly Rating:
http://www.njmonthly.com/topschools/hslist.lasso
Methodology
“Data for New Jersey Monthly’s biennial ranking of the state’s high schools were obtained from the state Department of Education’s most recent New Jersey School Report Card (covering the 2004–2005 school year). Only public high schools were included. Special-education and vocational-technical schools, as well as schools with no report card data, were excluded.
Monmouth University’s Polling Institute analyzed the data by first standardizing scores for individual statistics so that small differences did not have a disproportionate impact on the rankings and large differences were not minimized. These statistics were grouped into three categories. Each category was given equal weight in the rankings.
The categories used in the rankings are:
1. School Environment: The sum of the standardized scores for average class size; student-to-faculty ratio; student-to-computer ratio; percentage of faculty with advanced degrees; and number of AP tests offered compared to the total number of juniors and seniors (a calculation designed to avoid penalizing smaller schools).
2. Student Performance: The sum of the standardized scores for average combined SAT score; percentage of students achieving advanced proficiency on HSPA; and students scoring a 3 or higher on AP tests as a percentage of all juniors and seniors.
3. Student Outcomes:
A single combined score of graduation rate multiplied by the percentage of graduates going on to post-secondary education. Those going on to a 4-year college were given a weight of 1.5, those going to a 2-year college were given a weight of 1, and those going to other colleges or post-secondary schools were given a weight of .67.
Other New Jersey Report Card statistics that were not part of the ranking calculation include the percentage of students taking the SAT; the two-year change in SAT scores; the percentage of all eligible students taking an AP test; and the percentage of graduates going directly into a job or the military after high school.”
I think the NJ Monthly list is accurate. Of course, those who live in towns with schools that were ranked poorly will call the ranking flawed, but I find it to be reliable.
Donald,
Do you have kids?
jb
Lindsey, in post #30: “People have lots of reasons for doing things, and probably more reasons for not doing them.”
Gee, that’s deep. (rolls eyes)
No, I do not.
From Reuters:
Lawmakers ask SEC to clarify subprime rule
U.S. lawmakers on Tuesday asked the Securities and Exchange Commission to clarify an accounting rule that may be preventing some institutions from making loan modifications to help subprime mortgage borrowers.
A letter sent by 11 Democrats to SEC Chairman Christopher Cox sought clarification on the rule known as “FAS 140,” which governs asset-backed securitized products like mortgage-backed securities.
At issue is when a mortgage can be modified if it is part of a pool of securities that includes subprime adjustable rate mortgages made to borrowers with a poor credit history.
Lawmakers and federal banking regulators are seeking ways to move subprime borrowers into mortgages with fixed long-term interest rates, but the accounting rule might prove to be an accounting or legal obstacle.
“A number of parties have brought to our attention that FAS 140, the accounting standard that guides securitizations, may not clearly state at what point a loan may be modified,” the congressional lawmakers said in a June 15 letter signed by House of Representatives Financial Services Committee Chairman Barney Frank and 10 other House lawmakers.
pretorius,
I lived in Weehawken for several years:
Pluses
1. It is a great commuter location. You have the $2 Spanish vans available 24 hours a day to take you back and forth.
2. The upper cliffs (Blvd. East) are beautiful if money is no object. Also check out Gregory Ave/Mountain Rd area. Lots of decent houses, newer condos and good views of NYC.
3. The harbor area is fun. You have Houlihans for drinks and Dispirito’s, by the Sheraton, is a great restaurant (it may be called something else now). Views of NYC are tremendous.
Minuses
1. It is not the safest area. It borders Union City which can be very unsafe. A Weeehawken cop beat a 16 year old Hispanic youth to death a couple of years back. The Hispanic community was up in arms (90% Hispanic community, by the way). Recently, there was a young HS girl who was raped and murdered in Weehawken. Body was found in a dumpster. It was big news. She was from Bergen County and was kidnapped after a night of partying in the city. In other words, it is not female or child friendly. The schools are not good, list be damned. Trsut me on this.
2. It is “gold coast realty”. I lived there in 2002 and want to kick myself. I could have bought a row house for $180,000. In 2003, they were going for $240,000. By 2004, $400K..damn. It is very expensive now. Don’t know your budet but prepare for sticker shock.
3. Parking is impossible and your car insurance is out of control. My car was hit three times and broken into once. You can’t have a decent car in that area.
Texaninexile, in post #60 says:
“Of course, there’s also the elephant in the room that no one on the list addresses directly – class. We wouldn’t fit in, for example, in Garwood. Probably Kenilworth, too. We can afford places like that, but we’d be pretty isolated. Or am I wrong?”
Texan: If that’s what you can afford, then that IS your class. Sorry to break it to you that way. And, gosh, who knows, maybe there are other people in those towns with educations, who aren’t fit to overpay for housing. And maybe they won’t mind admitting a few snobs into the town, just to elevate the discourse. Stranger things have happened…
As I hinted at above, Weehawken is actually 2 towns. You have Blvd. East, where most of the population lives and you have River Road. While this part is very expenssive, I recommend it if you do not have kids. As far as safety, the complexes there have 24 hour security and are comppletely fenced in. I see tons of expensive cars there since parking is reserved for the residents of the community in private garages.
Rachel (219)-
One of the reasons I went to UNC was because I thought the ‘cue at Crook’s could get me by for a few years. One of the finer versions of the “wet” Carolina style. The owner, Bill Neal, is also one of the best chefs- and nicest people- on Earth.
With you, though…nothing beats turning into the Rendezvous alley in downtown Memphis and encountering that giant fan blowing smoke right out of the pit onto the waiting crowd.
Very polite discourse in here today, folks. Seriously.
Nobody’s arguing about real estate.
Hobokenite…thanks for the definition of Episiotomy (Sp?).
Here’s a high fast ball: If so many folks in here think prices will fall only a few percent a year over the next few years, how come you’re NOT BUYING?
Is it because there is still a rent savings?
Is it because you really care about that 2-3%…say 40k over a five year period?
Or is it because you fear the drop may be more like 30%?
Jamey (236)-
Boy, was that ever needed. F-ing egghead PhDs who move here from Woodtick…and don’t even bother to check out the cost of living in the suburbs of one of the most expensive cities on Earth? Guaranteed most of the fine residents of Kenilworth and Garwood have a much better handle on their finances. Maybe one of them could help Texanoid get a grip financially.
Thanks.
#214 JB A 1 in 3 chance? Aren’they lower now then they were at the peak? Where do these guys come from?
#239 I think many are not sure what prices are going to do,but do feel there will nbe a substanial drop. Just how long does that take?
I feel it will be sooner rather than later, for many reasons.
I am giving it another year,and then I will buy for a few reasons.
I certainly do not think that by waiting another year I will have to worry about prices going up!!
I might have to apologize to Richard though,and that will be painful.
I believe there was a change in the model, that PDF goes into some detail about those changes.
jb
“One of the reasons I went to UNC”
Clot,
….and I thought is was all about DOOK?
No crash yet in Manhattan; when people are priced out of manhattan they move to the boroughs and the suburbs.
http://www.observer.com/2007/summer-no-cooling-manhattan-residential-market
This Summer, No Cooling Off for Manhattan Residential Market
This spring was already unseasonably warm in New York, compared to the rest of the country
The inventory of unsold Manhattan condos and co-ops on the sales market has dropped during the last three months of spring. Inventory slid more than 11 percent from April through May and 25.7 percent from May 2006 to May 2007,
River road is fine if you stay close to Port Imperial or in one of the places that have a ferry shuttle because you have three good options for commuting.
That is, of course, providing the threatened ‘big one’ doesn’t roll up the coast and send 20 feet of water into your Shangri-La.
#214 JB A 1 in 3 chance? Aren’they lower now then they were at the peak? Where do these guys come from?
I actually do a lot of work with financial models in my job. The biggest problem with these models is that they assume perfectly rational behavior and perfect foresight by all market participants. This really makes them more useful for predicting long term trends, rather than trying to predict the short term market behavior.
Today’s housing market is anything but rational. It was built on a classic bubble. Psychology plays a huge role, but the models don’t factor this in. They don’t factor in “irrational exuberance”, the fear of getting left out, or the panic that often accompanies falling prices.
Bystander,
I agree with your Weehawken comments, except the crime one. Crime must be assessed objectively because suburbanites tend to have a distorted perception of crime rates. An objective, dispassionate assessment of FBI data reveals that crime rates in Bergen County towns, although overwhelmingly below the national average, are higher than Weehawken’s crime rate.
http://topics.nytimes.com/top/classifieds/realestate/locations/newjersey/index.html
(Click on Bergen and Hudson under community data, then click on interactive maps and total crime index.)
In other words, the murder of a white teenager from the suburbs will always make headlines, but an isolated murder reveals little about the security situation in the surrounding area.
The fact that objective data shows that 1)Weehawken’s schools are on par with the Bergen County average and 2) Weehawken’s crime rate is lower than Bergen County’s crime rate helps explain what you began to point out – Weehawken real estate prices have risen at a significantly higher rate than Bergen County real estate prices during the past several years.
“Today’s housing market is anything but rational. It was built on a classic bubble. Psychology plays a huge role, but the models don’t factor this in. They don’t factor in “irrational exuberance”, the fear of getting left out, or the panic that often accompanies falling prices.”
Indeed. I’ve noticed that a lot of economists seem clueless when it comes to the foibles of human behavior which seem obvious to just about everyone else.
I’m willing to bet that the same aspergery characteristics (lack of comprehension of social dynamics) I see in math professors are at work in other quant-dominated professions.
BC (244)-
Man cannot live on hatred alone.
Gotta have BBQ.
pretorius,
Just telling you my experience with Weehawken. Some streets are safe, some not. Outside of the harbor area, I would never allow any of the women in my life to walk around Weeahawken unescorted. I met several people who went to Weehawkem HS and they did not have great things to say about it. Of course, that was 20 years ago but apparently it has not changed for the better. English might be taught as a foreign language to your kid.
BLB (249)-
“Aspergery”. I like that word.
Nobody quant-oriented should get near RE…as a topic for research OR as a player. It’s ALL about emotion, irrationality, “me too” and just about every other human foible you can identify.
That’s why people like Shiller are so amusing. What a stiff.
two things –
1. leasing a car is ok if you have a limited, fixed cash flow and want to lock in repair and maintenance costs. My wife is a serial leaser because she just doesn’t like paying to repair anything on a car. so far, we saved money on two leases (btw – Honda Accords are a great value if you don’t need 350 horses and electronic control rearview mirrors)
2. “good” school districts definately help ALL kids do better. I taught for a few years in public schools and I saw wildly varing academic and social development results for similar profiles depending on the avilablity of resources. However, good parenting is just as important.
Conclusion – If you’re solid middle class, lease a decent car (not the pimped out model but middle of the road), try to get your kids into the best public school possible and cut your grass every weekend.
Just my 2 cents…
Donald,
Re #230. There are several of these lists and the people in the towns that appear higher on certain lists push those lists as the legitimate ones. Ultimately, most of the top districts appear relitively high on most of the lists. The thing is, in most of the “good” school districts people argue over being ranked at #3 or #10. The reality is that the top 50-75 schools in NJ are probably in the top 500 on the east coast. If anyone that lives in this part of the country wants better schools move to another part of the country and try to get a job or go to Barbados, India or Sweeden.
253
Or learn to swing a wrench and get an older model :)
Clotpoll,
Re #250
Pudding and souse is just as good.
R Patrick,
My wife drives the leases…I drive a 1990 model!!! :)
Donald,
I should add that some of these rankings look at things like diversity, social development oppertunities and other areas we could discribe as “soft” quantitatively. Diversity is important to me, so I look at those rankings more closely than those that only have test scores. Nevertheless…test scores do give solid bragging rights!
Out of curiosity, I went to http://www.leasetrader.com to see the kind of leases available. You can pretty much tell some of the folks have been taken to the cleaners by the dealership coz they went shopping with a ‘monthly payment’ in mind.
For example, this guy http://tinyurl.com/yvx4t9
A couple of things:
The school ranking stuff is screwy. In all fairness, the Freehold Regional District (Marlboro, Manalapan, Freehold Twp. Freehold Boro, Howell, and Colts Neck) has advantages due to scale that other districts can only dream of.
For the record I don’t live there, but because they have more than 10K students, they have specialized programs that are great; of course a kid can spend an hour on a bus if they choose a program that is too far from where they live.
As I said before, Monmouth County’s “Vocational” program also is excellent and not something that every kid can get into (Particularly MAST and High-Tech).
Because they are selective and have unreal resources, those two schools are really playing a different game.
Re post 232:
Jamey, you might want to follow the thread. Or maybe you’re the product of one of NJ’s “lesser” school districts.
#253
“1. leasing a car is ok if you have a limited, fixed cash flow and want to lock in repair and maintenance costs.”
That’s probably the worst reason to lease a car. Leasing only makes sense in limited cases and the ones it does, the persons are usually well off.
“so far, we saved money on two leases”
Opposed to what?
Home Seller,
Re 261. As opposed to buying the same car. Leaasd an Accura RSX and traded in for a Honda Accord. If we had bought the RSX would have had the same problem all those “pre-owned” RSX owners now have with tires, brakes and all manner of “inexpensive” fixes. Car now discontinued by the way but evryones buying the “pre-owned” models…funny. Accura isn’t ‘top-of-the-line” but do you know how much one tire for an RSX costs?
There’s nothing wrong with leasing if you’re not rich. Leasing can actually be a short term conservative move. what’s wrong with fixed costs and reduced risk? We all make trade offs between things like this…e.g. renting or buying a house; taking a vacation or saving for college; the $400 pair of Peal & Co or the $60 Clarks. There’s no cookie cutter solution.
just my two cents…