Predictions 2008!

OK you pompous prognosticators, dust off that crystal ball and lets hear ’em!

Ground Rules
Predictions provided should either be for June 30th, 2008 or December 31th, 2008, please specify.

Provide justification for your forecast, where applicable (unless you are just making it up, if so, state that).

You may provide any caveats and/or assumptions that your forecast is based on.

You need not provide a forecast for all categories below.

Where applicable, forecasts are judged against the surveys/reports listed.

Real Estate
National Existing Home Sales – NAR
Median Existing Home Price – NAR
Median Existing Home Price – S&P Case Shiller HPI
Median Existing Home Price – OFHEO HPI

New Jersey Existing Home Sales – NAR/NJAR
Median Existing Home Price – NAR/NJAR
Median Existing Home Price – S&P Case Shiller HPI
Median Existing Home Price – OFHEO HPI

National New Home Sales – NAHB
Median New Home Price – NAHB


United States
International Developed Markets
Emerging Markets

Mortgage Financing
30-Year Fixed – Freddie Mac PMMS
15-Year Fixed – Freddie Mac PMMS
5/1-Year ARM – Freddie Mac PMMS

10y Treasury
Fed Funds Rate
National Unemployment Rate
New Jersey Unemployment Rate

Anything else you’d like to make a prediction about.

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204 Responses to Predictions 2008!

  1. grim says:

    It’s usually quiet during the holidays, so this might as well be an open discussion..

  2. grim says:

    From Bloomberg:

    U.S. November Existing-Home Sales Probably Matched Record Low

    Sales of existing homes in the U.S. matched a record low in November, a sign the housing recession will continue to weigh on the economy in 2008, economists said before a report today.

    Purchases were unchanged at a 4.97 million annual pace for a second month, according to the median forecast of 53 economists surveyed by Bloomberg News. That’s down 31 percent from their September 2005 peak.

    “Demand for housing will remain weak,” said Brian Bethune, an economist at Global Insight Inc., a Lexington, Massachusetts forecasting firm. “We don’t expect any major change in the overall trend in housing.”

    Mortgage loans have become harder to get since banks tightened lending guidelines after the collapse in the subprime market, suggesting sales will keep falling. Rising foreclosures are adding to the glut of unsold homes, pulling down home prices and posing a threat to consumer spending, economists said.

    The report from the National Association of Realtors is due at 10 a.m. in Washington. Economists’ forecasts ranged from 4.7 million to 5.15 million.

  3. grim says:

    From the Times UK:

    Top economist says America could plunge into recession

    Losses arising from America’s housing recession could triple over the next few years and they represent the greatest threat to growth in the United States, one of the world’s leading economists has told The Times.

    Robert Shiller, Professor of Economics at Yale University, predicted that there was a very real possibility that the US would be plunged into a Japan-style slump, with house prices declining for years.

    Professor Shiller, co-founder of the respected S&P Case/Shiller house-price index, said: “American real estate values have already lost around $1 trillion [£503 billion]. That could easily increase threefold over the next few years. This is a much bigger issue than sub-prime. We are talking trillions of dollars’ worth of losses.”

    He said that US futures markets had priced in further declines in house prices in the short term, with contracts on the S&P Shiller index pointing to decreases of up to 14 per cent.

    “Over the next five years, the futures contracts are pointing to losses of around 35 per cent in some areas, such as Florida, California and Las Vegas. There is a good chance that this housing recession will go on for years,” he said.

  4. HEHEHE says:

    Dec 2008:

    NYC area housing prices will have dropped another 7-10%.

    Oil will be trading near $110 having hit high of $120 and gold at $870 having hit $900.

    Unemployment around 6% and federal funds rate at 3%.

    Essentially stagflation.

    Hilary Clinton will be president having played the emotions of the unemployed like a violin.

    The Feds will have instituted some sort of fiscal plan similar to the S&L crisis.

    New home buyers will now have to give a blood sample and turn their head and cough in order to get a new mortgage.

    HEHEHE will have found the next Ms HEHEHE.

  5. RentininNJ says:


    The U.S. will be in recession by June 30th. This recession will be a little different in that it will be an inflationary recession and not all sectors will participate. Overall, it will be a mild to moderate recession led by continued deterioration in the housing market & tight credit.

    The housing situation will worsen in 2008. The spring selling season, which will start early again, will bring a Tsunami of inventory. Price drops early in the year will be modest as sellers make their last stand in hopes that a knight in shining armor will bring them their big payday.
    By mid summer, foreclosures will set new records. With the economy in recession and talks of a turnaround pushed even farther out (pundits will be talking 2010 by now), bigger price drops will start to come in.

    In the fall, housing will take a bigger role in the presidential debate. Hillary Clinton will win the election.

    By December 31, we should see the emergence of our next bubble; alternative energy and low carbon technologies.

  6. Richie says:

    Anything else you’d like to make a prediction about.

    Anglelina Jolie adopts an Iraqi baby.

  7. Confused In NJ says:

    2016 will be a Presidential Race between Clinton’s Daughter & JEB Bush. The Constitution will be revised to allow Heriditary Rule.

  8. PGC says:

    There is always a few of us working. I like this time of year. The office is quiet and I can usually catch up on a lot of stuff i put off over the year.

    Predictions (my own) : NJ prices soften 5-10% but stay fairly strong. High inventory, but low sales. The boomers will have to put off the move to Florida. At the end of the day there are still a lot of people who don’t have to move. Most that are selling will have to buy again, so the price is a wash. At the end of the day there will be higher foreclosure numbers, but this will not impact the overall picture. We will not have ghost developments were 1 in 20 is occupied. In a town of 5000 homes, 50 forclosures is still 1%. There will be pockets of badness in places like Newark and Patterson. As always Real Estate is local. A few forcloseures in USR are not going to drive down prices.

    Recession avoided. The low dollar will bring manufacuring and service industries back on-shore. FFR will drop again through 2008 and when the election is over will spike up.
    Europe will start to see major cracks in the alliance. The EUR is too high and the French and German economies are showing strain. The EU recession is coming and it will not be pretty.

    The result of the Pakistan elections will be crucial to the middle east. If the PML pull away from Musharraf and win the election, all bets are off.

    Turkey to invade Northern Iraq.

  9. As this will be an election year this will be an election issue (duh). I’m expecting to see someone calling for the reinstatement of the Glass-Steagall act, really just the second portion; separation of commercial and investment banking.

  10. Al says:

    There will be pockets of badness in places like Newark and Patterson.

    There are already pockets of badness – check REO sites for Newark and Patterson – there are literally hundreds of REO properties at 1/2 price of other homes in the area. I personally will not buy a house in Newark or Patterson even if it would cost me 1$ !!!

    Recession avoided. The low dollar will bring manufacuring and service industries back on-shore. FFR will drop again through 2008 and when the election is over will spike up.

    I pray that you are right here – but remember one thing – to close a factory it takes one month…
    To open a new one – re-open old one – it will take years and often will be impossible to do!!!

    I KNOW IT – I work in manufacturing.

  11. 3b says:

    Recession officially declared begining of 2nd quarter. More write downs to come. Housing market dead, sellers that can will begin to slash prices.

  12. 3b says:

    #8 pgc: There is no way manufacturing jobs will be coming back here.

    They have been moving off shore for years. Perhaps some of the service sector jobs, as in call centers, but not manufacturing.

  13. Al says:

    My Predictionfor December 31st: Nationwide Prices are down 7%.

    In NJ starter home prices are down 5%.

    Middle level housing will be down 15%.

    Luxury housing will be down anywhere from 0 to 20% – hard to tell because sampling base is small and every situation is different

    Inflation is at 7-9%.

  14. Just me says:

    Happy New Year to all ..:)

  15. mark says:

    Marcal: will be bailed out by corzine.

  16. RentininNJ says:

    … and if all goes well, Mrs. Renting and I will buying in the fall of 2008. While I think a bottom is still a few years off, I think by the fall we will be able to find something reasonably priced if we are aggressive and work with a realtor who supports our philosophy (don’t fall in love with one place, be willing to walk away if the seller won’t budge etc.). By that time, enough seller will be ready to throw in the towel. If we can’t find something decent in our price range, we will start looking into relocation.

  17. Al says:

    Happy New Year – let’s hope that in 2008 all our problems will ne solved :)

  18. HEHEHE says:

    PS. A celebrity marriage will fail.

  19. 3b says:

    #13 Al: In NJ starter home prices are down 5%.

    Many starter homes are already down 5% from the peak.

  20. grim says:

    From MarketWatch:

    U.S. Nov. existing-home sales rise 0.4% to 5.00mln pace

    In a hint of stability, sales of existing homes rose 0.4% in November to a seasonally adjusted annualized rate of 5.00 million, the National Association of Realtors reported Monday. Sales of existing homes are down 20% in the past year and are down 31% from the peak of 7.21 million two years ago. Inventories of unsold homes on the market declined by 3.6%, representing a 10.3-month supply at the current sales pace. The median sales price fell 3.3% compared with a year ago to $210,200. November sales were in line with the 4.99 million annual pace expected by economists surveyed by MarketWatch.

  21. Sean says:

    2008 Predictions:

    Real Estate:
    We will continue to see a large glut of unsold homes and many homebuilders will consolidate or go bust, in NJ prices will decline 18% off of 2005 highs by December of 2008 and perhaps as much as 40% in other distressed markets like Florida, Las Vegas and California. Reasoning – do to the tightening credit crunch and tougher lending standards for obtaining loans many people simply will not be able to qualify for a mortgage.

    Oil – Prices will skyrocket to $170 dollars a barrel since the Saudis and other Opec members continue to struggle with production. Oil will replace the real estate market as the main driver of the recession with over a 50% raise in oil prices. A gallon of gas will increase to $4.50 which will suck an additional $225 billion a year from the American economy.

    Gold – prices will peak at $1,070 an ounce as a hedge against inflation.

    Soverign wealth funds will continue to buy up America on the cheap.

    FED -December 2008 Consumer price inflation will be approaching 10% per annum. In an effort to stem inflation we will see the FED raise interest rates by year end since they now realize that OIL prices are causing huge inflation that needs to be checked to prevent a depression.


    Iraq – violence will escalate again in the Basra region do to the withdrawal of British troops. This main oil production region will be hit with waves of Iran sponsored attacks that will paralyze that country and grind their oil production which has been nearing 2 million BPD to a halt.

    2008 Presidential election – In a not so surprise move Bloomberg will run for office as an independent. He will drop a record amount of his own money on his campaign and will win on his platform of prosperity and fixing Washington DC.

    Xanax – sales will reach an all time high.

    Britney Spears – will lose custody of her children for good end up in jail for a stint where and emerge 40 lbs heavier.

    NFL Playoffs and Superbowl –

    AFC: Steelers will beat the Jaguars, Titans will beat the Chargers, Patriots will beat the Steelers and the Colts will beat the Titans. In the AFC championship game Brady will jam his thumb and his throwing accuracy will be off so the Colts will beat the Patriots for AFC championship.

    NFC: Giants beat the Bucs, Redskins beat the Seahawks, Packers beat the Redskins, and the Giants lose to Dallas. The Packers beat Dallas since Jessica Simpson is in the stands for the NFC Championship.

    SuperBowl – Packers beat the Colts and Farve announces he will be retiring in Disneyland.

  22. grim says:

    Unfortunately, the Northeast saw a rather steep decline in November. Seasonally adjusted sales were down 3.3%, the worst showing among regions, nonadjusted sales were down 11.8%, the worst of the bunch.

  23. grim says:

    From Bloomberg:

    U.S. November Existing-Home Sales Rise 0.4% to 5 Million Pace

    Sales of existing homes in the U.S. unexpectedly rose in November to a level that still suggests the housing slump will be a drag on economic growth.

    Purchases rose 0.4 percent to an annual rate of 5 million from a 4.98 million pace in October, the National Association of Realtors said in Washington. Sales were down 20 percent from November 2006 and the median home price fell 3.3 percent.

    The improvement may be short-lived as higher mortgage costs and stricter lending rules further depress home sales, economists said. Falling home prices and near-record inventories give would- be buyers more reason to sit on the sidelines to await better bargains, pointing to weak sales into the new year.

    “With signs that home prices are falling, any would-be buyers may just stand back and wait,” Chris Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said before the report. “The housing market is in a recession and we doubt the news signals that there is light at the end of the tunnel.”

    The median price dropped 3.3 percent to $210,200 compared with November 2006. Home sales were down 31 percent from their July 2005 peak.

    “The housing pain looks likely to continue through 2009,” Harris wrote in a Dec. 20 note to clients. He predicted “sales and starts to fall through the middle of 2008, gradually rising in 2009.”

  24. Just me says:


    West Cost prices’s have been falling at the much more aggressive rate maybe that’s why sale were better?
    Also NJ , east coast , has not seen any significant asking price reductions as of today. Maybe this is a reason for lower sales?

  25. RentininNJ says:

    Sales of existing homes in the U.S. unexpectedly rose in November

    There is a huge amount of inventory on the market for this time of year. If you cast enough nets, you are going to catch some fish.

  26. Dan says:

    Any info (address)of MLS 20738949 would be greatly appreciated

    Thanks and happy preditions!!

  27. nwbergen says:

    My predictions for next year, more of the same.

    Waa waa waa. I want a house and I expect 20% off 2004 prices.

    Waa waa waa, I can’t can’t afford the house I want, but I call the house I CAN afford, a POS cape.

    Waa waa waa, I want to live in a special town but can’t afford to buy there.

    Waa waa waa, I want good schools, but I complain the taxes are to high

    Waa waa waa, I like to complain that NJ is is corrupt , but I don’t vote.

    Waa waa waa, I am special and I am entitled to the best of everything.

    Waa waa waa , I am hoping for a recession so I can afford a house, but if there is a recession I may be the one out of work, poof there goes my house.

    Waa waa waa, I blame the baby boomers for the high prices, not that I have saved for a down payment.

    Waa waa waa, I can’t get to NYC by train because there is no train station where I can afford to live.

    Waa waa waa, Hoboken and JC will never decile in price, yea forgot they are immune form market forces.

    Waa waa waa,

    Wake up, life isn’t fair! GET used to it.

    Happy New Year everyone!

  28. Aaron says:

    deflationary collapse.
    Dollar will come back strong and destroy the equity markets.

  29. ultrashortREinvestor says:

    Aaron 28: says, “Dollar will come back strong and destroy the equity markets.”

    How will a strong US dollar destroy the equity markets? I don’t understand the correlation.

  30. spam spam bacon spam says:

    [16] Renting:

    Hold fast to your ideals and you’ll do OK.

    Back in 2000, during the “multiple offers on a house within hours”, we told our agent not to bother showing us houses with an offer already on it.

    We explained our attitude thoroughly…trust me, we were open and honest…but, it was only after walking out of about 3 houses right in the middle of a walk-thru did she start to get it. The whole “don’t take long to think, there’s already an offer on this place” tactic would backfire, and it was only when she realized we would walk away from ANYTHING, did she get it.

    I literally would turn around and go out to my car to wait until she and my other half came out. My other half was in complete agreement, but usually defers to me to steer these moments…

    We saw people putting offers on places without even LOOKING at them. We were not about to compete with buyers like that.

  31. mikeinwaiting says:

    AL affordable home may be solved but there will be alot of pain in so maney sectors and ways that I wouldn’t venture to list.Let me throw some out there.Home prices NJ 5-7 % by June 15-20 by Dec.Auto sales even worse, defaults auto & CC on the rise big time.Oil breaks 100 finds level 93-98 barrel.Gold 950 to 1000 by June.FFR
    3% by June.Reccession for sure hits fan mind 1st Q.Unemployment 5.6 by Aug.Dems win 08 election by promising sheeple everything(but of course we don’t have the money).Boomers loosing their gains in biggest asset, afraid & some insolvent consumers pull back.US in major reccession by mid summer, europe follows, EU countries start to look out for themselfs big problems in union.US market flat Japan style many years.Tipping point fall 08 recession full blown the “D” word starts to get thrown around.
    NAR says its a great time to buy as more & more people lose homes & jobs.Credit markets across the globe stay constricted well into 2nd Q.Bad times all over, Asia fells the pain but not as bad,Mid east anybodies guess so many things can go wrong somethings is bound to.I guess my glass is half empty, the doom & gloom report.By nature I’m an optimist, just to much data going the other way to put on my rosey colored glasses.

  32. Aaron says:

    ultrashortREinvestor, dollar weakness is what inflated the market the last couple of years.

  33. 3b says:

    #27 nwbwegen: Ahhh, you are so young, so silly, so foolish. But you will learn, in the end they all learn.

    No area is immune from price declines. We are in a resession grasshopper (just not official yet). Prices are falling, jobs will be lost,people will lose their homes, (waaaa, I cant afford my mtg pymt bail me out) and yes some people will be hurt, that is the way it is.

    Those that are prudent will be rewarded, its that simple.

  34. 3b says:

    #25 rent:Sales of existing homes in the U.S. unexpectedly rose in November.

    And as grim pointed out existing home sales dropped dramatically in the northeast.

  35. PGC says:

    #12 3b

    Manufacturing will be back, but no in its previous form. The PA steel industry of old will never been seen again, you will however see high end niche markets. Car manufacturing will come back, but it will be more along the lines of the “Kentucky Camrys” than the “Detroit medical wagons” While the China plastics will still be imported and sold at Walmart, final end assembly of mainstream consumer goods will be done here.

    Solar and alternative fuels will be the next big thing. Biotech will finally get its full bubble status and start inflating.

    Lehmans will post record sales as the country gets “Back to Basics” … :*)

  36. grim says:

    You need to take “rise” in context.

    The “rise” they are speaking of was an increase from October to November of 0.4%

    In the larger picture, it’s hard to see how a 0.4% increase can offset the 20% decrease between November 2006 and November 2007. Even worse when you consider that national sales are down 30.1% from their peak.

  37. AAG says:

    Asbury Park will amaze the pessimist in ’08 as the redevelopment plan moves forward and the Esperanza construction site re-opens. Madison Marquette will deepen its commitment and bring us a vibrate board walk and downtown.

  38. njpatient says:

    “Unfortunately, the Northeast saw a rather steep decline in November. Seasonally adjusted sales were down 3.3%, the worst showing among regions, nonadjusted sales were down 11.8%, the worst of the bunch.”

    Hey – isn’t the northeast near New York City? This can’t be right…..

  39. Willow says:,0,1654836.story?coll=la-home-center

    Mortgage crisis takes a bite out of states and cities

    Tax revenue is down considerably across the nation, creating budget shortfalls and forcing hard choices on what to cut.

    By Stephanie Simon, Los Angeles Times Staff Writer
    December 31, 2007

    DENVER — Dozens of states, counties and cities across the nation will enter the new year facing deep and unexpected budget holes as the widening mortgage crisis cuts sharply into tax revenue.

    Elected officials, scrambling to adjust, are trimming money for public schools, reducing grants to help the homeless, even asking police to dry-clean their uniforms less often.

    “We’re talking about a pretty tough fiscal environment for the next four or five years,” said Christopher W. Hoene, the director of policy and research for the National League of Cities. “Libraries, parks, after-school programs . . . you’ll see lots of questions raised about cities’ abilities to fund them.”

    What makes this all so painful is that up until a few months ago, many government officials felt certain they could weather the storm. They knew property values wouldn’t soar forever. So they factored a downturn into budget calculations. They built up sizable emergency funds.

    But the rainy day they prepared for turned out to be a monsoon.

    “We had predicted a slowdown — but not this much,” said Tim Nash, finance director for Greeley (population 90,000), a college town in a heavily agricultural region of north-central Colorado. Nash thought he was being prudent when he budgeted for 200 new housing starts in the city this year, down from 310 last year.

    He wasn’t even close.

    . . .

  40. mneer1 says:

    Similar to the end the roaring 20’s the consumer will run into a brick wall. As other consumer asset classes, such as credit card, auto, student loans, etc. continue to deteriorate in performance, liquidity will run dry. Consumer confidence will plunge as unemployment spikes causing the fed to further cut rates. Inflation will begin to creep up due in part to continued increase in high energy costs. The over leveraged American will reach a tipping point causing defaults to reach new highs.

    Housing -20%
    Unemployment 7%
    Dollar -15%
    Equities -10%
    Oil $115
    CPI 6%

    I hope the above doesn’t happen, but this is just my estimate given current fundamentals.

  41. grim says:


    While not strictly enforced, I do ask practicing agents to disclose licensure here.

  42. AAG says:

    Its no secrete and fully disclosed.

  43. Shore Guy says:

    There will be many little upward improvements in housing numbers — here a .4% gain, there another — but an overall deeply declining trend; it will look not unlike a chart of the DJIA on the way from the top of a bull market to a bear market. And, with each slight blip up, the people who want to believe that the correction will be mild and short will point to the good news with all the excitement of a seven year old on Christmas morning.

  44. Hobokenite says:

    # HEHEHE Says:
    December 31st, 2007 at 9:52 am

    PS. A celebrity marriage will fail.

    Way to go out on a limb there : )

  45. Fiddy Cents on the Dollar says:

    I posted my prediction on the Weekend thread, I’ll copy here for the record. I don’t have hard number predictions for Schiller or OFHEO index, just a feeling on how the first 6 months will play out. Beyond that….too many dependant variables to even venture a guess.

    NJ Housing prices in 2008 will decline, slowly into the spring and picking up downward momentum as the Selling Season does not produce the buyers that everyone is anticipating. Into the summer, the homeowners who are COMPELLED to sell….those with untenable mortgages, those in pre-foreclosure, those who are retiring and moving out of state, will reduce their prices just to close a deal and be done with it.

    Six months out is where my crystal ball gets a little cloudy. If the Compelled Sellers trigger an avalanche, then prices could drop into a vacuum. But my feeling is that we won’t see a true capitulation phase this year.

    The trend is downward for the middle to higher-end homes where some current owners were only able to qualify using gimmicky financing. These owners will be COMPELLED to get out of the house, due to their unsustainable mortgages. They will either be forced to sell at distressed prices, or will be foreclosed. Some of these owners are truly better off renting.

    The lower-end homes will not falter as much. The buyers for entry level housing will find it tough to qualify for the mortgage products that will be available. Not enough documented income, not enough assets for the required down payment. Even 10% of a $350K purchase will be too much for these citizens. Some couldn’t qualify at any price.

    The homes in this price range will be bought up by investors and turned into rentals. The investors with solid financing will be able to knock the asking price down somewhat, but competition in this bracket will be enough to put a floor under the minimum sell price. And these units will be rented at cash-flow positive rates. Probably to the very people made homeless in the above scenarios.

    Townhouses and condos will take a beating, as they always do in these downturns. You only have to look at the 6 month sales history in any of these complexes to see the trend already in place.

    Gold and Oil will be higher by June 2008. The stock market will fluctuate around S&P 1450 plus or minus 70 points. A lame-duck president, with no dog in the election race, will flounder until the inauguration. I offer no guess on who his replacement will be, or even who the various parties will nominate.

  46. grim says:


    You are in Monmouth/Ocean, help a guy out with an address:

    MLS# 20738949

  47. grim says:

    From Bloomberg:

    Defaults on Insured Mortgages Rise 35% to Record

    Defaults on privately insured U.S. mortgages rose 35 percent in November to a record, an industry report today showed, adding to evidence the U.S. housing slump is deepening.

    The number of insured borrowers falling more than 60 days late on payments jumped to 61,033 last month from 45,325 in November 2006, according to data from members of the Washington- based Mortgage Insurance Companies of America. The missed payments, often a prelude to foreclosure, represented a 2.9 percent increase from October.

    “This is another data point that suggests that the mortgage insurers are in for a tough slog for 2008,” said David Havens, a credit analyst at UBS AG in Stamford, Connecticut. “Continued deterioration is likely to spur higher claims. And higher claims activity may result in some companies needing to raise money.”

  48. AAG says:

    2 APPLEGATE RD – Soon enough everyone will get address on the web. So what will the value of agent be then (the marginal agents always ask that question and it makes me crazy)

  49. mneer1 says:

    Housing is so illiquid that despite nearly 12 months of RE downturn prices are down just 4-6%, depending on region, a tip of the iceberg. It takes foreclosures, fire sales, and forced relocations to impact comps. The “tepid water testing” seller doesn’t let headlines and neigh sayers influence his listing price. After all, the “can’t loose money on RE” has been programmed into their heads for years. They have to experience stark reality first hand to be re conditioned. Therefore the 180+ DOM will continue causing prices to deflate for well into 2010. With mortgage financing returning to stricter pre 2002 requirements, massive numbers of prospective buyers will be shunned from the market.

    I mean seriously, does anybody expect RE to bottom out any time soon? We all expect prices to decline, does anyone have a prediction when RE will be a good investment again??

  50. Jim says:

    Re #40


    This will not effect NJ because the POLS will just raise taxes, or rent out a highway.

    Also a little known fact, the NJEA is negotating a new healthcare policy for teachers only.It will add more dollars of debt, but will keep the NJEA very happy, along with our grossly underpaid overworked teachers.

    It will be the GOLD standard.

  51. mikeinwaiting says:

    Jim your kidding over worked right.

  52. mikeinwaiting says:

    mneer 50 Want to play it safe 2011 “is a good time to buy” (couldn’t help that).

  53. Willow says:


    I was wondering why we haven’t heard of this yet here in NJ. One thing I thought of is the number of municipalities – my town has had, as far as I know, one foreclosure and a few in pre-foreclosure – so only cities like Newark, Paterson, Camden, etc. would see a great percentage of foreclosures (at least at this point) which would affect the collection of property taxes. Other state have county systems so the affect would be more. Also, bank owned houses in suburban towns are most likely snapped up so they don’t sit for very long thus putting them back on the tax roles.

    I’m sure there will be other affects eventually in NJ such as people who are not buying new homes will not be buying new furniture and appliances. Fewer homes being bought/sold will impact the amount of realty transfer fees collected.

  54. PGC says:

    “does anyone have a prediction when RE will be a good investment again”

    I think Warren Buffet just answered this when he came out with his new assurance company. No matter what the conditions, there is always opportunity, you just need to know where to look. While the toxic sludge sinks to the bottom, he has just skimmed the cream of the top with the AAA munis. Pure genius.

  55. gary says:

    Willow [40],

    The towns and cities will just raise taxes, it’s that simple. As long as Domino’s keeps delivering and Dancing with the Stars keeps broadcasting, nobody will notice.

  56. RentininNJ says:

    …even asking police to dry-clean their uniforms less often.

    No need to worry about ring-around-the-collar for cops in NJ. The unions here would start WWIII before yielding to such an unjust and excessively burdensome concession like asking police officers to pay for their own laundry from their own 6 digit salaries.

    If there is a budget shortfall, we will just have to raise taxes.

  57. PGC says:

    #49 AAG
    “Soon enough everyone will get address on the web”

    The quickest way to get an address is to call the listing agent and ask. The agents on this site share a lot more (and I am deeply thankful for it.) Some agents are less willing to give out items such as DOM and OLP. They will come up with it, but sometimes you have to hold their feet to the fire. The buyers (and sellers) here are looking to keep themselves informed and up to date so that they can gauge the accuracy of the information presented to them.

    One statistic I would be be interested in for 2008, is the number of active realtors. With the 2000 tech bust, the number of Realtors spiked up as displaced tech workers moved into the industry. Now as the market shrinks and the number of closing drop, the commisions dry up and the marginals start heading to the doors. In 2006 there were 88,000 salespeople, How many will stump up the $100 renewal to get them through 2008.

  58. SS says:

    RE #41:
    Speaking of tipping points:

    Malcolm Gladwell put out a good book called The Tipping Point. It details a [possible] handful of triggers that may have caused certain events to begin/end (crime, fiscal, fashion, etc). It was a good reader and may enlighten ideas as to when an economic tipping point may occur in ’08.

  59. syncmaster says:

    The only prediction I care to make is this: this time next year, we’ll still be making predictions.

  60. mikeinwaiting says:

    Grim 60 in mod.

  61. JC says:

    Can anyone prognosticate what condos/co-ops in the so-called “gold coast” area are going to be? I have friends who want to buy and I am inclined to tell them to wait. Are prices for lower-end ($200K range) co-ops rising, dropping, or stable in that area? They are looking along the Hudson River area from Weehawken to Fort Lee.

  62. RentininNJ says:

    I mean seriously, does anybody expect RE to bottom out any time soon? We all expect prices to decline, does anyone have a prediction when RE will be a good investment again??

    Bottom of price declines in 2010, followed by a long period of flat prices. 2015 – 2018 will probably be a good time to buy. By then, housing will no longer be considered an “investment” juts a place to live. Talks of a recover will be long gone. Prices will have been stagnant for years. The mainstream media won’t even talk about real estate anymore, good, bad or indifferent; it just won’t be a story of interest anymore. Joe Sixpack guy on the street will embarrassingly reminisce about the past decade where houses were traded like stocks and warn you that houses are “a stupid investment that will lose you money”.

    That’s when we will see the beginning of a true recovery.

  63. dreamtheaterr says:

    No WAGs by me; I am hopeless at it. My only guess is that winter 2008 will see NJ monthly home sales fall below the 1,000 mark.

    We plan to continue renting into 2009 and continue generating wicked positive cash flow each month. Portfolio to remain underweight US dollar (exposure through various asset classes), and tilted to large/mid growth.

  64. Hobokenite says:


    I think your right on the money.

    Median home prices will return to ~4 times median income. The last time I checked they were around 7 iirc.

  65. Jim says:


    Mike, Just a little sarcasm.I love reading how teachers bring work home, and spend all weekend preparing work lessons.[RE opinion in today’s Star Ledgeer]

    Reality, my wifes good friend is a teacher in Morris County, makes 82,000 a year,never brings work home,but still complains all the time about how much more she could make in private industry.

    The public employees and their unions need a clue, even GM took away their unions rich benefits, in NJ they just keep raising our taxes. I am starting to think Corzine is a member of the NJEA.

  66. Confused In NJ says:

    The NJEA controls the State of NJ. My one friend, retired from G.E. and was alway’s shaking his head about the rediculous spousal benefits his Morris County Teacher wife gave him in retirement. His favorite line was, “How can the people afford this?”. His wife’s favorite line was “Shut up, don’t rock the boat”. One friend retired as a teacher and got married after retirement. The new wife still got gold plated spousal benefits, even though she had nothing to do with his years of teaching. The Joke was, “she married him for his NJEA Medical”, which is more valuable then Gold. I guess in NJ the neaveau Gold Digger is someone who marries a Public Sector retiree to get their Benefit’s.

  67. mikeinwaiting says:

    Jim I’m giving serious consideration to getting in on that gravy train my self.Many in my fam teachers, cake walk ,thats them talking not me, you really have to pin some but they admit it once pushed.NJEA owns NJ

  68. Aaron says:

    My father was a teacher all of my childhood and was often grading papers into dinnertime. From what I have heard he was an above average teacher… he also coached the track team and put a considerable amount of effort into it. Not sure if he got paid anything to do so.

  69. njpatient says:

    What renting said at 64

  70. Hobokenite says:

    FWIW, here’s my guestimate:

    At the beginning of 2007, I was assuming a 5-10% decline for NJ, without using any specifics. After credit started tightening, I “predicted” 10-15%, using CS for NYC MSA. I think that was too pessimistic (or optimistic). I’m somewhat inclined to split the difference, but I think I’ll stick with 10-15% (using CS NYC MSA) for calendar 2008, due to even tighter lending standards, possible (probable) recession, and the effect of the credit crunch on Wall St. Probably closer to the low end of that range though.

    If the Fed continues easing (as seems likely in the short term), I think oil will peak at $120, but will eventually head lower, as much of the price increase of late is speculative.

    I think the EU housing bubble (particularly UK and Spain) will pop.

    I think Manhattan and the gold coast will start to see price declines, except at the very high end where the people just don’t care about the price.

    If the GSEs start doing Jumbos, this will probably slow the decline for the NYC MSA.

    I predict Bloomberg will get in on the presidential race as an independent.

    For Wall St., I predict lower profits, continued begging for cash, and more write downs and layoffs.

    PPP will win the upcoming (probably delayed) election in Pakistan.

    There will be a mild increase in violence in Iraq as the US troop surge ends. Politically there will be some form of reconciliation among the Sunnis/Shiites/Kurds.

    The rest of the world will discover that they aren’t really disconnected from a US slowdown after all.

    We will begin to find out where all the $hit from the subprime/alt-a/prime securitization market really is, and a rash of lawsuits will follow.

    At least 1 IB, and 1 large bank will be determined to be insolvent and need to merge/be rescued.

    PS: Going out on a limb here. A celebrity will pass away.

  71. reinvestor101 says:

    I predict this blog will go away after real estate starts booming again. People like Stu, Homer, Clod, Inpatient, 3b, Hehehe, BC Bob, Pat and etc. will be begging me buy my home while bidding against each other, but I will not sell anything to them. That will anger them and others and the class war exhibited on this blog will break out in the open with Clod being the ring leader. Homeland security will apprehend Clod and the other terrorists and ship them to Guantanamo Bay. They will get them to admit to the depths of the terrorist plot to upend real estate markets. Clod will try to hang himself, but unfortunately will fail. Pat will regret moving to PA and will try to move back to NJ. BC Bob will regret selling his home and renting after he realizes that he left hundreds of thousands of dollars on the table. Inpatient will correct his attitude and apologize profusely to me. I won’t forgive him. Hehehe will stop reading the Looney Tunes website and begin reading reputable periodicals. Grim will call Warren Boronson and apologize to him. lishooh will ask me to marry her. I will demand that she buy a house first.

    That’s it for my predictions. I’m looking forward to the new year!

  72. HEHEHE says:

    PS: Going out on a limb here. A celebrity will pass away.

    I thought mine was mor ballsy.

  73. ultrashortREinvestor says:

    “I predict this blog will go away after real estate starts booming again.”

    Well I agree with one of your predictions, although I doubt this will occur in 2008.

  74. pretorius says:

    “Can anyone prognosticate what condos/co-ops in the so-called “gold coast” area are going to be?”


    I forecasted 2006 and 2007 home prices for Jersey City, Hoboken, and Weehawken. These municpalities pretty much make up the Hudson County Gold Coast.

    You can read my accurate 2006 forecast in the original post here:

    You can see the actual 2006 results along with my 2007 forecast in the original post here:

    I will post my 2008 forecast on njrereport in the next few days.

  75. pretorius says:

    jb, I’m in moderation in post 77

  76. syncmaster says:

    chifi #74,

    As an Indian male, I will tell you this – the rumors are true.

  77. Hobokenite says:

    HEHEHE Says:
    December 31st, 2007 at 1:59 pm

    PS: Going out on a limb here. A celebrity will pass away.

    I thought mine was mor ballsy.

    True. But I will make another prediction:

    The streets of Hoboken will flood during 2008.

    PS: Happy New Year everyone!

  78. pretorius says:

    In late November, I posted a list of comps for Weehawken. (see post 198)

    The reason I made the list is because I felt that some people were ignoring the fact that home prices are holding up – even increasing – in some NJ towns.

    Since I posted the list, 5 more comps have become available. These comps are homes that sold during 2004-2007 and have just sold again.

    Closing date and price
    Previous closing date and price
    Absolute and annualized gains

    518-536 GREGORY AVE #A412
    28-Mar-05 $352,500
    04-Oct-07 $395,000
    12% 5%

    600 HARBOR BLVD, UNIT #860
    21-Nov-06 $688,692
    16-Sep-07 $730,000
    6% 7%

    600 HARBOR BLVD, UNIT #866
    02-Feb-07 $451,676
    19-Sep-07 $534,000
    18% 31%

    28-Jul-05 $1,450,000
    02-Oct-07 $1,970,000
    36% 15%

    883 BLVD EAST #5B
    15-Sep-04 $191,000
    29-Oct-07 $235,000
    23% 7%

  79. SS says:

    #74 / #79

    I’m not Indian, but it’s obvious they know how to use their “millimeter monster” – just look at the population.

  80. Fiddy Cents on the Dollar says:

    Hobokenite #72-

    Pretty good progosticatin’

    Except for that bit about Sunni/Shiite/Kurd reconciliation. These people have been butchering each other since 2 different people claimed to be the “rightly guided Caliph” in the 7th Century. There is nothing in today’s tea leaves that suggest those scars are healed.

  81. John says:

    RE down 10% and qualtity investment grade corp bond market and muni bond market have a good year.

    Banks and IBs start to stablize in first half and have a good second half.

    But just cause they mark it all down on paper by second quarter 2008 it will take another year for individuals to price those new prices in so I look for an RE bottom around Feb 2009 with a three year flat to 1-2% increase rate. Before we start to recover in 2012!

    Oil will end the year down but will have a good first few months.

  82. John says:

    BTW 50/50 that kid in Paki gets a bullet in the head in 08.

  83. John says:

    Most of the other safest places share Mission Viejo’s profile of bucolic suburbs far removed from the mean streets of the inner cities. It nosed out two New York City suburbs – Clarkstown, N.Y. and Brick Township, N.J. – for the No. 1.

  84. Hobokenite says:

    John Says:
    December 31st, 2007 at 2:51 pm

    BTW 50/50 that kid in Paki gets a bullet in the head in 08.

    He’s heading back to Oxford to finish his education.

  85. Hobokenite says:

    Fiddy Cents on the Dollar Says:
    December 31st, 2007 at 2:43 pm

    Hobokenite #72-

    Pretty good progosticatin’

    Except for that bit about Sunni/Shiite/Kurd reconciliation. These people have been butchering each other since 2 different people claimed to be the “rightly guided Caliph” in the 7th Century. There is nothing in today’s tea leaves that suggest those scars are healed.

    I don’t expect them to be holding hands and singing Kumbaya together. But I think they are sick of the violence and death, and having their country torn apart. There will still be violence, but not at the levels seen after the bombing of the Samarra Mosque.

  86. bergenbuyer says:

    I finally had one of my lowballs accepted. I’m going into Atty Review now. I took 1999 prices and added 4% a year and made offers like that since 2006. This one was finally accepted. Thanks to all for your advice. Also, my new neighbors are gonna sh*t when they see what I paid. It’s a definite comp killer.

  87. grim says:

    I really think there are multiple re101s..

  88. Confused In NJ says:

    In New Providence, up until 1980’s, teachers volunteered for things like High School Graduation, which was held on week ends. Subtle changes in the 1980’s led to High School Graduation being held on week days. When the administration was questioned on this change, their answer was Teacher Salaries were too expensive to pay for on week ends. So, a lot of the volunteerism died in the 80’s when Teachers gave up their Profession, in favor of Union Blue Color Assembly Line Benefits. No Pay, No Work.

  89. Hobokenite says:

    Just to clarify, I meant political reconciliation.

  90. Fiddy Cents on the Dollar says:

    Can Kumbaya actually be translated into Arabic?

    I agree for the most part with all your other predictions.

  91. Hobokenite says:

    Can Kumbaya actually be translated into Arabic?

    I was actually wondering the same thing when I wrote that.

  92. gary says:

    2008: Gold will rise above the psychological level of $1000 per ounce as the wheedlers masterfully propagate the next “investment” which the proletariat will gobble up like a triple bacon cheeseburger and super biggie fries.

    Median home prices nationwide will fall steadily at the same rate as in 2007 with the exception of the S.F./Silicon Valley area and the NYC metro area. These areas will stay flat in nominal terms against an actual inflation rate approaching 6% while real wages grow at 0.35% as corporations look to tighten and slash with reckless abandon.

    The ten year yield will approach 3.15% at year end as panicky investors try in vain to secure some security and growth while the Middle East and Asia continues to diversify into Euros at an alarmingly accelerated rate.

    Hillary Clinton will get elected and her first course of action will be to raise the income tax on median and high wage earners 5% above the current rate while pushing for the elimination of the 15% capital gains tax in favor of the new “adjusted” income rate. She will trumpet this move as a “brave contribution” by the “workers” of America.

    The new show called “Dis Your Neighbor” will be the most-watched TV reality show for 2008.

  93. ultrashortREinvestor says:

    “Dis Your Neighbor”

    When is that on?

  94. Willow says:

    Re: Teachers

    In our school district, because it’s not in the teachers’ contract (and probably would never get in one), there is no supervision on the playgrounds at the elementary schools before school. The children are allowed on the playground for 15 minutes before the bell rings but there is no one to watch them. A few years ago, they eliminated the morning playground aid positions to save a few dollars. If high school teachers can have cafeteria duty why can’t the elementary teachers have playground duty. Oh, that’s right, they don’t get to school in time.

  95. CAIBC says:

    bergenbuyer – good luck on the purchase, you apparently have had better luck on the low balls than i have – none of the offers we put in have come through – maybe in 08!
    care to share the details? so we can all learn how its really done!

    you are an inspiration!

    Have a Happy New Year all….


  96. pretorius says:


    Put your offer in writing. Write at the top that your offer is not contigent on the sale of another property. Transfer $ around your accounts so that you have an amount equating to 20% of your bid in your checking account, and attach this checking account statement to your offer letter.

    Tell the broker in a serious, polite voice that you understand the seller was hoping for more, but that you will buy the place if your offer is accepted.

    Last year, I successfully used this technique to buy my primary residence for 21% below asking.

  97. Ann says:

    My prediction based on nothing..

    I believe prices have already dropped about 10% from peak 2005 prices (to about 2004 prices).

    I’m predicting another 5-7% drop by the end of 2008. Then prices stay there for years, meaning the value really keeps dropping a bit each year, but the average person won’t realize that.

  98. kettle1 says:


    Ok, so in october i called oil would hit $100 before year end. It turns out i was off by $1.

    -expect oil to stay above $100 for a large part of 08 and i would not be surprised by a spike up to $150. There are drivers in the energy markets that are only going up in the near future ( supply/demand reversal; peak oil , yes i said peak oil).

    – Gold, gold will break $1000. This will be a combination of the herd mentality and partly due to weakness in the global and US financial markets (i.e gold as a disaster hedge).

    – Housing, will continue to decline in 08 and fits and starts. i predict that this bubble will deflate in a similar fashion to the late 80’s/early 90’s bubble. However we will go lower in real prices as this bubble will take 10 years to work out. What the real killer will be is the inflation adjusted prices over the 5-10 year period from now.

    – Civil liberties, what you thought you had any civil liberites????? what country do you think this is? sweden? The dems will take the whitehouse and continue the police state evolution.

  99. Ann says:


    Congrats! Wow, that’s a pretty amazing offer that you got accepted if I am understanding the math right!

  100. Ann says:

    97 Willow re playgrounds

    Why are the kids on the playgrounds early anyway? Do the buses drop them off early and there is a gap between the dropoff and the teachers?

    Unsupervised kids on a playground! That is not good, depending on how little the kids are.

  101. Ann says:


    My advice would be make your best offer first and tell them it is your best offering. If you’re offering way below list, you don’t want to play games by leaving the room to negotiate thing in there, you want to minimize the ‘perceived’ insult as much as you can by making the best offer you want to, first and sticking to it.

    Also, don’t assume that days on market or the house being vacant means anything. A long DOM can just mean that you have crazy, stubborn sellers.

  102. kettle1 says:

    From the LA Times

    The great fall of China

    Revised GDP calculations show that Beijing isn’t the giant we thought it was.

    By Walter Russell Mead
    December 30, 2007

    The most important story to come out of Washington recently had nothing to do with the endless presidential campaign. And although the media largely ignored it, the story changes the world.

    The story’s unlikely source was the staid World Bank, which published updated statistics on the economic output of 146 countries. China’s economy, said the bank, is smaller than it thought.

    About 40% smaller.

    China, it turns out, isn’t a $10-trillion economy on the brink of catching up with the United States. It is a $6-trillion economy, less than half our size. For the foreseeable future, China will have far less money to spend on its military and will face much deeper social and economic problems at home than experts previously believed.

    What happened to $4 trillion in Chinese gross domestic product?

    Statistics. When economists calculate a country’s gross domestic product, they add up the prices of the goods and services its economy produces and get a total — in dollars for the United States, euros for such countries as Germany and France and yuan for China. To compare countries’ GDP, they typically convert each country’s product into dollars.

  103. reinvestor101 says:

    No Grim, there’s only one. I do move around a bit and use different access points, but I’m the one and only. For example, I happen to be in the midwest now, but I’m the same one. Do not accept any imitations!!

    grim Says:
    December 31st, 2007 at 3:09 pm
    I really think there are multiple re101s..

  104. Willow says:

    #103 Ann,

    No buses so parents drop off and they all can’t pull up at the same time. It is sent out in a letter at the beginning of the school year that the children (1st through 5th) are allowed on the playground at 8:30 and school starts at 8:45. I drop my child off a half block away by a crossing guard so I can get him there as close to the bell as possible.

  105. Willow says:


    I should also add that most days my son walks to school with friends. I have probably dropped off 5 or 6 times since September. They walk so slowly that they never get there with any time to spare.

  106. 3b says:

    #73 You are an idiot, and not even funny.

  107. Just me says:

    99 great idea ,,thank you ..I will use it when I make an offer .

    Happy New Year All !!!

  108. lisoosh says:

    Prediction for 2008 –

    Large inventory spike in the spring.
    Psychology is changing, so while there will be the usual suspects in unrealistic sellers there will also be a hard core of more aggressive sellers who will price around 2004 from the get-go. This will cause a lot of upsets, but as these houses get offers, others will follow and the flood will start around mid-summer in terms of prices dropping.

    Price drops will spiral inwards – people who would have moved to PA will look in Western Jersey, West to Central, Central to North and so on. So the drops will be more extreme (more desparate sellers) further out and the central ring around Manhattan will drop later (but it WILL drop).

    Entry level will be dead until prices get to where first time buyers with money down and solid financing can afford it. Entry level buyers will be much pickier, even in the prestigious areas. Someone making $200k may have bought a $600k hovel in 2005 thinking they would make money on it and move up, but they will be MUCH more cautious if they think they will be stuck there for the next 20 years.

    Death of entry level will kill everything else as there will be no move-up money.

    Brigadoon may be later hit BUT there could be pain in the higher end of the town as City jobs go. Same for other “prestigious” addresses.

    Based on amount RE prices are out of sync with salaries I would hazard a guess of at least 30% drop in values, with a lot of it this year. Why this year? Credit crunch, inflation, recession. Money is GONE and there is no confidence that it will return in a hurry.

    Definitely a recession, big drops in consumer confidence when credit card bills hit after Christmas season. Job losses from RE will start to hit those on official payrolls (a lot of the pain up till now was black market and illegals). Inflation is still high, food costs are skyrocketing. Kettle makes sense on oil, the pump will be a nightmare this summer. Again, the money is GONE.

    RE investors. Flippers are burned, won’t be back in a while. Small timers tearing down small houses to build Shackmansions out. Some people thinking they are smart will buy to rent and be burned because the figures still won’t add up to positive cash flow. Smart investors out for at least a couple of years, except for true sharks who can get an inside line to an exceptional deal or two.

    Manhattan – HOPING that current inflow of foreigners will be stemmed by recessions in UK, Ireland and Europe. Those places are ripe for their own crashes and they won’t be feeling so flush when that happens. Plus, it may stem the tide against the dollar as the currencies chase each other down.

    And it is not a prediction but a promise – definitely WONT be issuing any marriage proposals this year.

    And I predict that a celebrity with a name beginning with the letter “J” will give birth this year :-).

  109. Ann says:


    Wow. I wouldn’t want my kid there either, sounds like chaos, but I guess if they are old enough to walk, they are old enough to hang out for 15 minutes.

  110. Outofstater says:

    #73 re will be fitted for one of those cute little jackets with the arms that tie in the back.

  111. stuw6 says:

    Seeking Alpha:

    Don’t Expect a Housing Bottom Until Late 2009

    “Readers, I am going to spare you from posting about housing every month when these reports come out. For those who have been reading the blog a while you know my views. But, for new readers, here is a summary: Month after month it will be bad news. Every so often a report will look “ok” since it was “up” from the previous month (but still massively down year over year). The CNBC talking heads will tell you *this* is the bottom. The home building stocks will rally for a few days, probably 20-30% off of very low levels. Seals will clap on TV, and you will just ignore it. Just realize that until late 2009 or early 2010, it’s all a sham.

    Until prices come down to a level where people with 5-20% down, 6% fixed rated, making normal American incomes can afford, we are nowhere near a bottom. The only good thing that I have seen lately is that new home starts are finally slowing, and home builders in desperate attempts to see a cash flow, have slashed new home prices. We now are going to face an almost comical dichotomy in some markets – new homes selling for 30% below existing homes.”

    Follow the link for the rest of the article.

  112. Just me says:

    Just Heard …Merrill runing a sale again ? Sold its insurance group ….wooow

  113. Bubbles says:

    Just a lil funny from ML site.

    I heard that John 31-Dec-07 03:58 pm is considering doing a
    Theleton For Merrill.
    The Host would most likely
    be Stan O Neal.

  114. lisoosh says:

    Anyone ever seen this before, Saxo Banks Outrageous Forecasts? They make forecasts in the extreme to “generate discussion” so they say:

    Copenhagen-based online investment bank Saxo has released its outrageous predictions as part of its 2008 outlook. 

    The predictions are an annual attempt to predict black swan sightings in the global markets, and this year present an ominous view. Black swan events are high impact, rare occurrences that are beyond the realm of normal expectations.

    Among the forecasts are Ron Paul being elected as US president, 3 of the largest 10 US home builders going bankrupt and grain prices doubling again.

    Saxos black swan predictions also include a UK recession and the Chinese stock market falling by 40% by late summer. 

  115. Hobokenite says:

    I can definitely see a couple home builders going BK, and the UK/China stuff seems quite plausible as well.

  116. Essex says:

    I love this thread….one observation though….why of why do people want to strip away benefits from those who serve them and their children for 25 years….at a rate that would not and does not attract enough qualified people….a job that most leave in the first 5 years…..

  117. Ann says:

    119 Essex

    I don’t get it either.

    If people want to be teachers so badly, why don’t they?

    I can’t imagine why….Hmmm

  118. mikeinwaiting says:

    Essex 119 Because the benefits are exccesive
    self employed shouldn’t be forced to give up their benes & retirement for a job of 185 days 40 hours a week.Put in 60 a week only take of 1 dayt for major holidays then I’ll pay for it,if not get a second job to pay some towards it they surely have the

  119. mikeinwaiting says:


  120. AAG says:

    #58 PGC

    “How many will stump up the $100 renewal to get them through 2008”

    Never mind the $100 license renewal. The 6 hundo for O&E will surly push out the slackers and I can’t wait… Way too many bad agents out there that no nothing about serving a client or running a business.

    Happy New Year All!!!

  121. Jim says:


    I am not complaining about teachers, it is their benefit package that is gone completely overboard, this equates to real estate taxes and deep debt for all NJ taxpayers.

    It must come in line with private workers who contribute to their own healthcare and pension plans.

    It is common for a teacher to retire @55 and receive a $50,000 pension.We have a friend who gets 71,000 per year,it is public record!

    One little factoid for you: the first baby boomer to sign up and collect SS is a retired teacher, her quote was that her SS is just for pocket change, and for “fun” things.

  122. Pat says:

    I’m afraid to make a prediction.

    Not worried that my predictions will come back to haunt me in the form of taunts from RE, Pret and bi, but an intense fear that I will continue to be unable to locate my past predictions. December 31st. Need to remember 12/31. 12/31.

  123. Pat says:

    74 what was in the *kaboom* forum that I can’t see?

  124. Confused In NJ says:

    A key reason NJ Retiree Medical Expenses Doubled between 2000 & 2005 is Spousal Medical Benefits. In previous years the Private Sector had Retiree Medical Benefits that were equal to the Public Sector. Private Sector Spouse used Private Sector Medical, Public Sector Spouse Used Public Sector Medical. As that changed, starting in the mid 80’s, more spouses switched to the Teachers Plan. Recent changes like the High Deductible Medical Plans, initiated by Bush et. al., and adopted by Major Private Companies since 2004, further accelerated this. The smart money today is one spouse works on Wall Street to get todays Cash, the other becomes a Teacher to secure Platinum Benefits for both, for the Future, until Death. The State needs to limit Medical to the Employee only, similar to Lucent eliminating Spousal Medical. It’s that or make all the Children Indentured Servants for Life to pay the Teachers Benefits.

  125. Clotpoll says:

    AAG (38)-

    “Asbury Park will amaze the pessimist in ’08 as the redevelopment plan moves forward and the Esperanza construction site re-opens.”

    Enjoy your sparking Kool-Aid tonight, AAG.

  126. Essex says:

    MIke — not to hi jack the thread but…..teachers….first off you are trusting someone with your child–precious person really–priceless beyond any amount. The pay is equal to what a good corporate secretary would make….requirements are a college education — often a masters degree. Being around kids all day long requires tremendous focus and energy….also patience. I still am not sure why the benefits package is an issue…they are literally deferring a decent salary while they are in their prime earning years…for a little security in their twilight years.

  127. Clotpoll says:

    PGC (58)-

    It takes a lot more than $100 for an active agent to keep going into ’08. Board memberships and MLS participation fees drive that number up to about $500.

    Whatever number of active agents is left standing in ’08, it’s still 10x too many. Still a contagion of stupid sweeping thru my industry.

  128. Clotpoll says:

    If there is a God in heaven, ReTard will die.

  129. Clotpoll says:

    Ann (103)-

    “Why are the kids on the playgrounds early anyway?”

    Only one reason to show up early to the playground: to drink and huff blunts.

    Wake and bake, baby!

  130. Essex says:

    Clotpoll…..your a trip….OK, so here is a parent saying…Yeah…I want to spend ‘less time’ with my kid…I need to get rid of them ‘early’ so I can get to work….so why oh why isn’t someone in the playground to babysit them? Darn teachers! Lazy overpaid! Or, try a pre-care program….most schools have them…..or get the kid to school when they are supposed to be there.

  131. Clotpoll says:

    In 2008:

    -Gold will hit $1,000/oz by June 1.

    -Washington Mutual will be declared insolvent and fail. There will be runs on all of WaMu’s retail locations. Taco Bell will give out free food to those on line.

    -The Spring selling season will be even weaker than ’06 and ’07, prompting a late-season capitulation that will result in a wave of sales that will drop NJ prices- across the board- 10% lower by 12/31//08.

    -The hardest-hit areas will be “non-NYC-commute” towns. However, prices will fall by at least 5% in places such as Brigadoon and prestigious BC. Even the finest addresses will be hard-hit by a total absence of trade-up buyers.

    -In Manhattan, delinquencies will rise on commercial mortgages. The wobbly commercial market will be the harbinger of residential woes to come.

    -Countrywide will seek bankruptcy protection. Angelo Mozilo will be indicted for something, by some entity (DOJ, Illinois or North Carolina). He will court public sympathy by announcing he has metastatic skin cancer. His announcement will provoke a public backlash against the tanning booth industry.

    -Fannie Mae will be authorized to begin a jumbo mortgage division. It will have no effect on the market, but Fannie will immediately begin to mismanage its new portfolio.

    -K Hovnanian will seek bankruptcy protection.

    -Barack Obama will be assassinated just before the convention.

    -Hillary Clinton will be elected president in a landslide.

    -Bloomberg will run as a third-party candidate and derail any hopes of the Republican candidate, Mitt Romney, winning the election.

  132. Clotpoll says:

    sx (133)-

    I can only speak from my own experience. :)

  133. Essex says:

    CLotpoll…..for the win! Hilarious. But probably on target.

  134. Willow says:


    The point is that the school says they can be on the playground 15 minutes before school starts. Other school districts line the kids up in front of the school to wait for the bell rather than letting them play unattended on the equipment and blacktop. Yes, there are parents who drop their kids off early so they can get to work. Most do not drop off early because they have to get to work but rather to get their kids to school on time since the entire school cannot be dropped off at the same time.

  135. BklynHawk says:

    Ok, I’ll go out on a limb…

    These are end of 2008 predictions for full year – 12/31/2008.

    Existing Home Sales 4.5 million
    National Median Price -5.5% nominal versus 2007

    New Home Sales 750k
    New Home Median Price -10% nominal versus 2007

    NJ Sales will decline by low double digit percentages (approx. 10%). Also, the initial boomer effects will be felt with higher inventory than 2007.

    10 year Treasury 4.5%
    30 year 6.1%
    15 year 5.7%
    Fed Funds 4.5%

    President = Bloomberg after everyone else’s campaigns implode.

    Despite all that bad news for sellers and RE industry folk, here’s to a great 2008 for all.


  136. syncmaster says:

    Bloomberg said “no” without any caveats or explanation when asked if he will run for President on Dick Clark’s new year eve show.

  137. Homer says:

    2008 Prediction

    Commuter towns will lose there vaule the most. As Bergen county becomes more affordable, people will want to move closer to NYC. People buying there homes will not be able to afford there absurd asking price and people will not want to mortages so they will opt to taking lower offers. Prices will continue to decline throughtout the year. In the end there will be a normal affordable housing. 100-200k houses.
    Mega mansions will be a thing of the past.
    Many will be converted into multi family homes(if you think that cant happen, look at Boston and towns around there).

    Investors will look for a new way to get rich quick, they will go through many tries and failures..
    Flipping cars and other weird things
    Than we will have another tech kinda of bubble. But this one people will become online investors, and start mini investment companies. That will lead to more demise.

    Merrill Lynch will replace the bull mascot with a Donkey to represent there traders.
    Most of the traders and investment bankers will lose there jobs due to the new CEO attempting to outsource the stock market to India. Merrill will go under by years end.

    Jobs will continue to be outsourced to 3rd world countries and jobs will dwindle and dwindle. And it will not be until 2013 until we get a decent person in office and they tax goods comming into this country, we start regulating import into this country.
    Jobs will start comming back into the country. The us will start a comeback.
    No longer will everything say made in China
    We will see made in USA. We will slowly phase out importing from other countries.
    Large copration will start to colapse, and small companies will take over due to people getting tired of large billion dollar corporations outsourcing there jobs.
    List of companies that will collapse b 2015

    Merrill Lynch
    Johnson and Johnson
    Bristol Myers Squibb
    Morgan Stanley
    All staffing firms
    So on and so fourth.
    Large corporations, outsourcing, importing foreign good, importing foreign cars
    and so on will be a thing of the past.

    No more million dollar bonuses for Wall Street donkeys.
    No more huge executive salaries.
    Granite, stainless steal, travertine etc will also be things of the past.

    So enjoy 2008 it will mark the year of correction for this entire country.

    PS and especially no more recalls from china by 2015

  138. Homer says:

    One more thing
    2008 President will NOT BE Clinton
    Huckabee will be or new prez

  139. scribe says:

    I have a feeling that once the mortgage mess really hits, the new down payment requirement will be higher than it was pre-bubble – 30% versus the old 20%.

    I predict that the wave of the future in home building will be smaller, more reasonable “build it green” homes. Maybe not right away, but down the road, in 3 to 5 years.

    I predict that today’s McMansions and CHC’s will be referred to as “the houses of the bubble” and 10 years from now, derided as being “so Bush administration.” White elephants.

  140. Essex says:

    McMansions and the return to common sense dwellings…..there is probably as much of a chance of that happening as there might be a return to real musicianship and talent in the world of popular music…..naw — we are destined to continue to dive into the abyss that is modern culture….our nation will dumb itself down. If we elect an imbecile like Huckabee on the heals of Bush II — we all should simply move into mobile homes….embrace fundamentalist beliefs….and buy copious amounts of baked beans —

  141. grim says:

    From the WSJ:

    PHH Ends Agreement
    With Blackstone, GE Unit
    January 1, 2008 5:38 a.m.

    PHH Corp. said Tuesday it terminated its planned deal with private-equity firm Blackstone Group and a unit of General Electric Co. amid problems with the availability of debt financing needed to fund part of the transaction.

    GE’s General Electric Capital Corp. unit and Blackstone had agreed to acquire PHH in a two-step deal valued at about $1.69 billion on March 16. The deal called for General Electric Capital Corp. to acquire the company, which operates a mostly prime-mortgage business and a fleet-management-services provider, and then sell the mortgage operations to Pearl Mortgage Acquisition 2 LLC, an affiliate of Blackstone, leaving General Electric Capital Corp. with PHH’s fleet-management business.

    On Sept. 17, PHH said that J.P. Morgan Chase & Co. and Lehman Brothers Holdings Inc. “revised [their] interpretations as to the availability of debt financing” that could result in a shortfall of as much as $750 million needed by Blackstone to fund its part of the deal.

    The Mount Laurel, N.J., company’s industry has been hit hard by the implosion of the mortgage business at large. A 2005 spinoff from Cendant Corp., PHH says it is one of the top originators of residential mortgages in the U.S. It originates “private-label” mortgages for financial institutions including Merrill Lynch & Co., TD Banknorth Inc. and Corp. Most are “prime” loans of higher quality than the subprime debt that has roiled the credit markets in recent months.

  142. grim says:

    Happy New Year!

  143. Confused In NJ says:

    History Channel say’s December 2012, “Game Over”, so our next President will be the “Anti Christ”. Wonder if that’s Obama or Clinton or Bloomberg? Doubt if a Republican can win after the Neocons.

  144. mikeinwaiting says:

    Happy & Healthy New Year!
    What the hell are we doing up so early new years morn.

  145. Pat says:

    Happy New Year, everyone.

    147, early? We have cats with expectations, man.

    I was up all night worrying about something MEN never even think about. A simple baby shower for my niece is turning into the event from h3ll faster than the credit market collapse.

    I was planning a surprise – 25 people at a Greek restaurant that has good spinach pies and indoor golf for the kids. In just 48 hours since I mentioned it, my sister told my niece the date, the place and the time, and it has turned into a formal affair with 50 people as of 8 am. I haven’t checked e-mail since then. ‘Everyone’ will be ‘so’ offended if they are not invited.

    Sometimes, every once in a while, I wish I came from a normal family like most of you.

    Count your blessings.

  146. Essex says:

    2008! Here’s hoping you are where you want to be or heading there!

  147. mikeinwaiting says:

    Pat You haven’t met mine!These things tend to mushroom out of control, good luck with this one, better you than me.Been there.

  148. grim says:

    Expiration time again, almost 1000 GSMLS listings expired over the past 2 days.

  149. scribe says:

    From yesterday’s WSJ Real Time Economics blog:

    December 31, 2007, 1:11 pm

    Liquidity Threat Eases; Solvency Threat Still Looms

    As 2007 winds down, the much-feared year-end liquidity crisis appears to have been averted thanks to aggressive action by central banks. The Federal funds rate has averaged well below the Fed’s 4.25% target so far today thanks to the Fed’s ample supply of cash through open market operations and $40 billion in term loans auctioned earlier this month. Anyone who needed money over the year-end appears to have already borrowed and those with excess funds may have to accept a pretty low return today given thin markets.

    Libor rates have dropped sharply since Thursday as contracts since then take effect after the year-end. The one-month rate has plunged to 4.6% at today’s fixing from 4.85% Thursday; the three month rate has fallen to 4.7% from 4.83% in the same period. These are still high relative to the expected federal funds rate because banks still have an ongoing demand for cash to fund new obligations and residual concerns about each others’ creditworthiness.

    Nonetheless, as Lou Crandall, chief economist at Wrightson ICAP LLC said today, “Things are unfolding smoothly.” The first quarter is likely to start much as the fourth quarter did, with reduced concerns now that the statement date has passed.

    Balance-sheet strains will continue to create concerns about the price and availability of short-term funds, Mr. Crandall said. But for the most part, “We’ve moved beyond … liquidity concerns. The focus has moved to that part of the financial fallout that central banks can’t address through technical operations.”

    In other words, as 2008 begins, it’s solvency, not liquidity, that threatens the economy and the financial system. And at the root of the solvency threat is a likely decline in housing prices that will further undermine credit quality. Making banks more confident of their own ability to raise funds is not going to resolve a generalized shrinkage of lending driven by declining collateral values.

    A looming threat is an expected hit to housing demand as Fannie Mae and Freddie Mac impose new fees to buy or guarantee mortgages once considered prime. The fees, described by the Wall Street Journal earlier this month and the subject of an article in the Boston Globe yesterday, are imposed on customers putting down less than 30% on a home and with credit scores below 680. Bianco Research notes in a commentary today that 620 was previously considered the minimum for a prime borrower. Based on how many consumers have a credit score between 620 and 680, the firm estimates “over one-third of home buyers are going to get ‘crunched’ by tougher standards, much bigger downpayments and interest rate ’surcharges.’” The fees apply to mortgages the companies buy after March 8. Bianco Research says, in effect “means any mortgage originating after January 1 will be affected by these changes” given the typical lag between when a mortgage is originated and when it settles.

    “We believe home prices will continue to fall,” Bianco wrote. “This is the cause of the credit crisis.” The collapse in issuance of mortgage-backed collateralized debt obligations is itself merely a result of falling home prices.

    On the other hand, maybe home prices don’t have much further to fall. For an optimistic forecast, read the above post on Real Time Economics. – Greg Ip

  150. bubblewatcher says:

    My late prediction:

    Similar down cycle to 80s 90s downturn with the $ additioanl declines by about 10-20%. Total drop: SFH down 20-40% depending on location – condos and coops 30-60% (some possibly 75% in highly overbuilt, less desirable locations).

    The solid starter homes will have least drop (as last correction), poor locations will not be able to sell unless given away, the mid market trade ups will take a big hit – this is where the deals will be – especially rough ones.

    The bigdrops will begin mid 2008 as some of you predicted years ago. After a last-gasp try this spring for sellers sticking to their high prices – they finally throw in the towel.

    I agree with #142 that we may see a requirement for 25%-30% down – by this will be dependent on the quality and pricing of the property – a new subjective metric for the banks to judge the lending.

    The ONLY driver for new construction will be green. Mcmansion popularity will go the way of SUVs. The hottest (and maybe only) construction market will be in the new American tear-down: Well located, small properties with remodeled or new construction that is efficient, simple, spacious, smart. Architects have already dabbled there in the past few years and this will come to the mainstream.

    No prediction on recession – too many factors that are beyond my ability to measure. I hope we can have the needed housing correction without going that far.

  151. scribe says:

    Also from the WSJ’s Economics blog:

    December 31, 2007, 3:15 pm
    Will Home Prices Hit Bottom by June?

    The biggest threat to the economy in 2008 is likely to be falling home prices, which weaken the collateral behind trillions of dollars of loans and erode household wealth and thus spending power.

    But James Glassman, economist at J.P. Morgan Chase, argues most of the necessary decline in home prices has already occurred. “Given the present trends in income and house prices, real estate excesses of the past five years will have vanished by spring 2008,” he argues in a new report (PDF).

    Judging how overvalued homes are depends heavily on how you measure valuation. There are at least three competing yardsticks for home prices which all show differing trends. And they can be compared against a variety of benchmarks: consumer prices, rents, and household incomes. A popular ratio published by the Congressional Budget Office suggests the ratio of home prices to rents is about a third above its long-term level.

    Mr. Glassman compares the Case-Shiller National Index of home prices to gross income per household. That ratio was relatively steady from 1970 to 1990, then fell below trend through 1996 before starting to head up, and peaking well above trend at the end of 2005. By that point, house prices had outstripped growth in incomes by 28 percentage points. Since then, however, incomes are up 10% and prices are down 6%. Mr. Glassman “75% of real estate excesses may be corrected… Corrections often go to overboard, but the current trends in house prices and incomes will restore real estate values to “normal” levels by next spring.”

    Moreover, most of the drag from falling home construction has also already occurred, Mr. Glassman says. “New home building has already fallen to below-normal levels in response to expectations of a grim 2008.”

    It’s true that shrinking wealth due to lower home prices will retard consumer spending, but that is likely to unfold gradually, he said. A 10% drop in housing prices would wipe out $2.3 trillion in real estate equity, which reduce the level of consumer spending by 1%. But this could transpire over several years. – Greg Ip

    Lots of comments on this one:

  152. bi says:

    happy new year folks!

    6 months ago, i predicted that putin’s successor will be a hairy person. yes he is:

    Regarding RE, i can only predict the prediction of this blog. but here is one of my other predictions:

    May Flower will make a return trip after almost 400 years parked at a mystery location near boston; the active memebers on this board will be first on board.

  153. Bubbles says:

    Happy New Year !!

    Simple : NJ homes will sell for 30-40% less before year end.

  154. scribe says:

    Here’s the Boston Globe story mentioned in #152:

    Preapproved and ready to move? Not so fast

    The subprime mortgage crisis has forced skittish lenders to tighten rules for borrowers

    Justin Moore had done his research when he set out to buy a condo. The 25-year-old said it even seemed easy when he got preapproved for a loan, found the perfect condo in Beacon Hill this fall, and readied for his December move.

    But just one week before his scheduled closing, the mortgage company that for weeks had assured him he was all set told him there were problems.

    First, Michigan-based Quicken Loans said he would have to pay a point at closing to keep a 6.25 percent interest rate because his credit score was below 680. Then he got a frantic call from the representative he had been working with telling him the company couldn’t give him the $225,000 mortgage after all.

    “They said they couldn’t fund a condo where all the units aren’t sold yet,” said Moore, who was slated to put a 20 percent down payment on the first unit finished in the building. “Where is there a situation where all the units are sold?”

  155. Essex says:

    I love the prediction about the small or mid-sized, well-located property….making a home efficient and using space wisely has always been the main goal here in casa de la essex.

  156. bi says:

    my new year resolution is to make more fact-based statement rather than wish-based prediction. assuming the numbers in this web site is reliable, here are some facts supporting high RE price in desirable nj towns: very high percentage of household income is over 250K. for example,

    tenafly: 20%
    mendham: 28%
    millburn: 31%
    westfield: 15%

  157. grim says:


    I would have thought higher. Maybe we need to revise our predictions downwards.

  158. PGC says:

    #148 Pat
    “Greek restaurant that has good spinach pies and indoor golf for the kids”

    Where is this Olympus?

  159. Frank says:

    “Tolls on state roads including the New Jersey Turnpike and the Garden State Parkway would rise considerably in the years ahead, but Mr. Corzine has not specified by how much or when.”

    Raise them up to $5. I love it.
    Happy New Year!!!

  160. Clotpoll says:

    bi (160)-

    “…my new year resolution is to make more fact-based statement rather than wish-based prediction.”

    Better up your meds.

  161. Just me says:

    Can anyone give me history of :
    Jackson, NJ 08527
    MLS# 20729023

    Thank you!!!

  162. PGC's wife says:

    #148 ‘Everyone’ will be ’so’ offended if they are not invited.

    Offend away – aside from grandmothers, wanna be grandmother’s, and the guest of honor, no one actually likes baby showers. Inviting 50 people is obligating 50 people to buy gifts!

    And, I too would like to know where to find good spinch pie and indoor golf for the kids. Please share!

  163. Rich In NNJ says:


    Where are your predictions for 2008? I thought you would be all over this.

    Happy New Year All!


    PS Holidays are over, time to plan a “get together” for cocktails.

  164. Rich In NNJ says:


    I’m in moderation due to my use of the word for adult beverages.


  165. rhymingrealtor says:

    Sometimes, every once in a while, I wish I came from a normal family like most of you.

    Thank you Pat for my first laugh of the New Year.
    That has been a wish of mine for so long. I just have to be grateful for caller ID


  166. rhymingrealtor says:


    Re: Inventory

    Jan 2007 GSMLS Low 27170
    Jan 2008 GSMLS Low 30580

    The starting point for inventory build up is considerably higher, this should be quite a year.


  167. gary says:

    Not a bad looking property in an OK town, I suppose. Certainly not classified as “haughtyville” but what choice does a hard-working soul on a modest income have? Again, I see the price and it just doesn’t compute.

    Geezus, I’ve said time and time again, I don’t know how a lot of you here are not in full blown revolt mode. I would be absolutely beside myself if I didn’t at least own something. I give you all a lot of credit for your patience.

  168. R Patrick says:

    Predictions as I should have next NYE off ( if they don’t change my schedule )

    1. 3.50 gas in NJ, possibly 4.00 gas in the summer peak travel periods like memorial day and August.

    2. Hillary and Obama have it out in NJ and NY. They split the party and the Election is a toss up.

    3. 8 dollars on GWB, ect. 5 dollars each way on NY B&T Congestion pricing occurs making me even less likely to sit in the traffic to visit my mom on LI ( making her sad ) Tolls on the NJT increase, people start getting devices to obscure plates ( bikes have them already ) and big trucks start taking 1/9 and local roads at 2AM because they are already being spanked on diesel.

    4. People who have to sell, will sell, possibly for a loss. Granny will still cash out and move to florida on the house she bought in 45 for 25K ect.

    5. Cash money talks, the bottom rungs stay broken since any one still buying has real earned money ( some of you ) or multi generational family money undertable loans/gifts and said family wants to protect said investment. Expect grandpa, or uncle bob or papa ming at the second showing with the happy couple especially in gold coast towns when they think they have found something.

    6. Realtors have a lot less attitude to 23 year olds with 20% down like they did when I bought.

    7. Dollar continues to weaken.

    8. Fed drops rates, a little but adds more liquidity because thats what Bernake said he would do.

    9. 5 dollar gallon of milk. 1.50 shoulder of pork. 1.00 wholesale chickens.

    10. Graduate degrees keep being the gateway to the middle class ( SFH in NJ and Near NYC NY ) and they go up some more as well.

  169. njpatient says:

    #154 scribe

    James Glassman?
    James Glassman?!?!?

    The Journal still publishes that fool?!?

    In 2000, Glassman wrote and published a book entitled “Dow 36000” with a subtitle something like “how to profit from the coming equity bull run”.

    I don’t think we need to discuss Glassman’s credibility. He has none.

    Bi, has the Journal offered you a column?

  170. 3b says:

    #152 bubble:The solid starter homes will have least drop (as last correction), poor locations.

    You might wnat to revise that prediction. The first time buyer is going to have an incredibly difficult time secuirng financing in today’s environment.

    And they are the market for the solid starter homes, and north Jersey is full of these starter homes.

    Remember, people (first time buyers) are now going to be required to put down a substanial down payment, which will be shocking for many.

    Everything old is new again.

  171. AAG says:

    #165 history of 20729023

    DOM 177

    10/09/07 $469,900
    08/06/07 $479,900
    07/08/07 $495,900
    07/07/07 $495,900

  172. BC Bob says:

    First of all Happy New Year to all!!

    No need to make a prediction for RE in 2008. Go back into the archives here, late 2005-early 2006. What else is there to say? However, if one must; 8-10% [2008] hits in NNJ. Declining prices will continue into 2011. The surprise? Prices will fall much further and longer than virtually most can imagine. The surprise to me, where prices went as compared to where they are going.

    The fed, with images of the GD and Japan [1990], will continue to inflate. Inflate in 08′, tee shirt anybody? FFR at 2.75% by year end. The Dow, S&P and nasdaq will rally the first 3 quarters of the year. S&P up 8%, Dow up 10% and nasdaq up 14% by Sept.. The selloff comes late 2008, early 2009. That said, Citi, will be a buy around the 2nd/3rd quarter, a screaming buy. However, you won’t realize that it was a bargain until 2011-2013. If Hillary is elected the stock market will be obliterated, led down by the nasdaq, the dollar will be pummeled and Gold will go to the moon.

    Regardless of who is elected, Dec 08′ Gold contract, not the date it will occur but the contract, will hit $1,122.50. Nov 08′ soybeans will hit $15.40 and front month crude will hit $119.42.

    As we continue to be bombarded with CDO’s, MBS and SIV’s, we now include CDS and CLO’s to the fray. Most used word in 2008; Distressed.

    Finally, Senator Larry Craig will be found innocent in his airport toilet tryst. His lawyer will prove that he was inordinately exuberant while campaigning. He was simply reaching out to shake a hand of a prospective voter. Much to his surprise and dismay, he was stunned when he discovered he found a bird in the hand.

  173. Sean says:

    Happy New Year to all!

    Since I joined this blog last year I have learned much about the state of affairs in NJ and one of my resolutions is to contribute more to my fellow taxpayers in New Jersey.

    A prediction I missed yesterday was local taxes.

    I predict local taxes will rise by 11% via combination of direct local taxation and reductions in direct taxpayer relief from the State.


    The amount paid in local and state property taxes in this country increased 50 percent from 2000 to 2006, according to census data inflation rose 17 percent and median household income dropped 2 percent.

    New Jersey of course is a the head of the pack and now we have Gov Corzine setting up a roadshow to pitch massive increases on the toll roads to plug what is predicted to be a large budget gap.

    My analysis of the Fiscal Year 2008 budget, shows NJ is predicting a net 4.2% increase in collections of sales tax from 8.425 Billion to 8.778 Billion. However, I believe that retail sales were off by as much as 12% during the Holiday selling season and that fortells a drop in sales tax collections throughout next year, perhaps as much as $500 million by year end FY2008.

    Income Tax collections were predicted to rise from 11.465 billion to 12.415 Billion in FY 2008 an 8.3% increase, meanwhile we are not showing any real net gains in job growth. That 1 billion increase in income tax collections may not materialize.

    What will be the net effect in NJ?

    State Aid to Municipalities, School Aid, and Direct taxpayer relief account for over 50% of the States budget. Any kind of shortfall in collections can only mean higher local taxes.

    We all know the towns those fortresses of home rule, would rather raise taxes than cut services and benefits.

    When is the last time your town cut taxes?

  174. Fiddy Cents on the Dollar says:

    Homer #140

    You get the prize for the most bizzarre set of predictions. Did you have mushrooms with dinner last night??

    $100K – $200K homes in NJ in 2008?!?!?

    List of companies to go belly-up includes IBM and Microsoft?!?!?!

    As I read your post again, you were joking around with those predictions….right??

    I get it now. But Homey, that kind of humor doesn’t transmit well over the internet.

  175. Just me says:

    175 ..thank you!!!

  176. Pat says:

    Dear PGC family: Sorry, it’s in Pa. I’m spoiled regarding good spinach and meat pies. A Lebanese family, right off the boat in the 60’s, had a bakery near our house. They just happened to become some of our best family friends.

    One of them mentioned the pies were mezzo mezzo (to me that means they’re awesome), so I was going to try it:

  177. lisoosh says:

    Willow –
    It’s not necessarily a bad thing to allow kids to play on the playground and burn off some energy before going in.

    Why not contact the PTO about any safety concerns and have them organize parent volunteers to supervise?

  178. scribe says:


    I didn’t know the history on Glassman.


  179. mikeinwaiting says:
    Fiddy I have one for you its not moving I’m sure you could get it for 235.Thats if you want to live up north.Homer can you get to work from here I’m sure wife & kids would love it.Schools are good.3 bd 2.1 bath bi 1987.If you wait it out there will be a ton of them in 6 to 8 monthes at about 200 – 225 unless we are all wrong & re 101 is right.What are the odds of that.

  180. mikeinwaiting says:

    Pat and I thought I was north west of noware thats out there.I looked in PA but close to border by 84.I do not like Pocono area where 80 crosses.

  181. Pat says:

    mike, I don’t live up there….just a few old relic holdouts in the family.

    My niece’s entire in-law family is in the NEPA area from Allentown up through Scranton.

  182. Ann says:

    Gary, you crack me up with these “finds” of yours on Realtor.

    I’ll tell ya what makes my stomach turn more than the price of that silly house in EP (which they will never get).

    I think we’ve all screwed ourselves by having both parents working now. If one parent (usually the mom) would stay home for 5-10 years at least like the “old days”, housing prices could have never gotten this high in the first place.

    It’s like everyone is working more than ever, and with both parents working which is added stress too, and we’re all still only living in the same places we would have been had we all made a pact to have one parent home when the children were young, which also happen to be the years that you tend to buy houses.

    Argh. Of course, I say this as a very PT freelance writer SAHM who doesn’t make much cash right now.

  183. mikeinwaiting says:

    OH! That is out there.You are in PA though right as I remember.

  184. Fiddy Cents on the Dollar says:

    That’s a nice house in Vernon. Be a heck of a commute especially in the winter. You’re closer to High Point than to Dover Twp.

    “Subject to Third Party Approval” is a clue, as are the price cuts from $319K.

    Tax records say he bought in 2005 for $280K, looks like a re-fi in July of 2006 and got divorced in July of 2007, been on the market ever since.

    But Homer said “$100K – $200K”…..not $249K. And his list of companies that will collapse includes some heavy hitters.

  185. mikeinwaiting says:

    Fiddy much closer to High Point,I can see it now out my windows.Homer reaching on companies but you may get a nice house for 200,surely up by me.Commuted to Wayne 10 years 1 hour not bad, when it snows 4-5 times a year you deal.That house is in a nice part of town to if he can’t sell it for 249 then O boy in 6-8 monthes.Mike will
    be waiting.

  186. bubblewatcher says:


    Yes – I agree that with the large qty of starters, it will further segment the starter market into sellers and non-sellers, with the best holding tighter than the rest. Quality construction, normal layout (not odd weird layouts), reasonable taxes, and solid commutable location will always be desirable and sell at fair prices. Garbage will sit unsold. Of course, everything will take longer time to sell.

    You may ultimately be right that the starters may even drop because of the recent ridiculous overpricing, but remember location location location (close to jobs and ammenities) is always valuable and desirable (rather than the past 5 years of anything, anything, anything). It depends on what the mid level tradeup market drop is.

    General Exception – if all jobs disappear and an area becomes undesirable – ie: Detroit.

  187. Bubbles says:

    HMMM …will the rest of the country follow???

    Jumbo loans still scarce in high-cost areas
    California prices could plunge 35%, costing $2.6 trillion in lost wealth

  188. Homer says:

    $100K – $200K homes in NJ in 2008?!?!?
    I am not talking about Bergen county, I could care less about bergen county. Right now I live in mercer county. I am reffering to tows in somerset county that are in the upper 2 up to 400k for a decent size house.
    Maybe you care about train towns. But honestly I dont care about proximity to NYC or a train or bus town. I live in NJ work in NJ and damn sure one day in like 50 years or more kick the bucket in NJ. Also I am not looking to live in some richey yuppie towns. I am reffering to towns that were where average household income families lived
    I am not even accounting for yuppie towns like westfield, Mendham, Bernardsville, etc
    So before people think keep saying I am crazy, why not ask to where I am reffering to. I honestly could care less if prices of tolls increase, bridge, tunnel prices increase. Just becuase most people on this board want to live in some town like Short hills, not everyone wants to.
    And again if the tax relief of 20% for people who make under 100k covered 70% of the entire state of NJ, 100-200k is just about right. To be higher in in Bergen county and yuppie towns.

    I grew up in Bernardsville, yes in a yuppie town, but I am far from it.
    In Bernardsville you had 3 parts to the town
    The moountians where the MCMansion were and houses were ubber big. Very expesnive
    Middle income to upper middle income homes were. And than you had the part of town where the price of homes were less for lower to muddle income families lived.
    And in 97-98 there where house, town house etc that yes you could purchase for 100-200k
    ANd thats the way it is going to go back to.
    And if price dropped 50% in the last bubble why cant they now?
    All my predictions exclude Bergen county.

    Its people like you who think everyone wants to live in BErgen county or wants to work in NYC.
    I dont care and am only reffering to towns outside Bergen county

  189. Confused In NJ says:

    I Predict: New 2008 Sin Tax by Cody & Corzine. Everyone will be required to get an Annual Physical. Doctor will report Height, Weight & BMI to the State. NJ will Charge a $10 per pound Annual Surcharge for all those exceeding the Average BMI for their Height. All proceeds will go to the State Teachers Fund. Teachers will be exempt from the new requirement.

  190. Essex says:

    192 and 193…really thought provoking fellas. Really.

  191. Ed Sanders says:

    I haven’t thought this through as much as I should, and while I’ve got some basis for my guesses, let’s just call them wild so I don’t have to go back and look at what influenced my calls:

    NAR’s existing home sales: my call: 4.5M, basically 20% below NAR’s Yun’s prediction. In fairness to Yun, my job doesn’t depend on believing in miracles.

    NAR home price (currently reported as $217,600) will decline by at least 4% and, if things get really sticky (more likely than not) twice that seems likely.

    NJ will see a drop in sales of at least 15% and prices for SFHs will fall a minimum of 6%. Condos/THs will fall further in both volume and price, 20% for sales 12% for prices.

    No prediction on New Home sales because the Census Bureau #s are simply not reliable at this point.

    I wish I had some idea where equities are headed, but I have no idea, the amount of liquidity in the system will play a big role in answering that, and there’s no way to figure out how far Bernanke et. al. are willing to go.

    Oddball:No series for the Yanks, again.

    The Dems take the White House, and an extra seat or two in NJ.

    Lots and lots of people realize they made horrible decisions regarding housing/mortgages in 2007.

  192. Ed Sanders says:

    Oh yeah, at least 10 of the nation’s top 100 builders fold their tent.

  193. PGC's wife says:


    Thats only about a 90min drive for us. so we are close (for NJ). I was planning a trip to Scanton to take my kids on the trains. is Theos the place with the golf?

  194. Richie says:

    I Predict: New 2008 Sin Tax by Cody & Corzine. Everyone will be required to get an Annual Physical. Doctor will report Height, Weight & BMI to the State. NJ will Charge a $10 per pound Annual Surcharge for all those exceeding the Average BMI for their Height. All proceeds will go to the State Teachers Fund. Teachers will be exempt from the new requirement.

    Nice, do us persons who weigh less then average get a refund??

  195. Bloodbath in Winter 2007 says:

    Really interested to hear Grim’s predictions. Somewhere in the archives, I predicted that houses in Bergen County that were asking 600k at the peak in 2006 would sell for 400k at the bottom. We’re getting closer to that – a house in Glen Rock recently was up for sale under 400k.

    I have a feeling January and February are going to be brutal for the economy, not just housing. Once those holiday CC bills come in, coupled with increased heating bills, increased grocery bills, increased gasoline bills, etc will lead to very lean times across the nation. This will also help Mrs. Clinton win the election over Rudy. (Mitt Romney could have more money than Warren Buffet – the Republicans would be foolish to give him the nom.)

    I think in 2008 some newspaper reporter will read this blog, see the phrase, ‘BANKRUPTCY IN NEW JERSEY’ and we’ll see a series (fine, maybe just one) about the potential for the state being bankrupt in 10 years. (Who knows if this has happened; perhaps i missed it.)

    What might kick-start things: increased tax bills … even though the value of probably 80% of the houses in NJ are stagnant or going down. This will lead to another wave of folks moving out of NJ, though I’m not sure where they are headed.

    We have been monitoring the Bucks County housing market and will be making the leap from NYC to PA in 2008. We will rent at the outset, and then, after getting to know the area, buy the type of house we wanted in NJ – 4 beds, 3 bath, 2-car garage, etc – with the same quality school district, for 400k. Our tax bill will be half of what it would have been in Bergen County.

    We will miss the cultural mecca that is NYC, but we’re fairly certain that we’ll still visit as often as we would if we were living in Bergen County.

  196. Herring123 says:

    I predict many mainstream news outlets will call a (false) bottom in ’08.

  197. still_looking says:

    …I can’t even imagine what’s in store for ’08.

    Rich in NNJ – is 240 paramus rd still UC?

    Clot- did Bristol Ct Steve finally give up?

    Everyone else, Happy New Year.

    I can safely report that in the past 4 months I have seen more uninsured, charity care, medicaid, and NJKidCare patients than I have EVER seen. My only prediction could be that more NJ hospitals are at significant risk of closing.


  198. Pat says:

    PGC’s wife, yes. When I ran in to look at the place (was in there for all of 5 minutes), there appeared to be an odd room in the middle of the restaurant with a few weird miniature golf holes…like on hills. I think it was previously a factory room that could not be used for tables.

    One warning…the place smells a bit like old museum because of the displays. FYI, if you have kids 8 – 11, the coal mine tour is good for a little bit of a excitement/fear factor. When we did it, I could hear boys whispering to their parents if we were ever going to be able to make it back up out of the mine. It may have been the old Polish guy taking the group down on the cart. He looked around, no smile, and said, “Let’s go to work, boys.”

  199. still_looking says:

    Happy New Year to Rich and Clot, too…

    I just re read the above post- What I meant was Happy New year to everyone!

    (sheesh…I gotta fire my editor!)


  200. Orion says:

    I predict there will be an unusually high number of house fires in 2008.

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