From the New York Daily News:
Amid challenging real estate market, some sellers forsake agents
It’s a quiet Sunday afternoon on the Upper East Side and newlyweds Jon and Milissa Aronson are perched expectantly on their sofa. A plate of cookies and a sign-in sheet sit strategically on a kitchen counter.
The couple (he’s 35 and a broadcasting exec, she’s 33 and a social worker) have sent their dog to the neighbors, and vacuumed, dusted and tidied their 550-square-foot, one-bedroom apartment, all in hopes of selling their home without a broker. They’re asking $459,000.
“We decided to sell on our own basically because of money,” said Jon Aronson. “If you factor in a broker’s fee of 6%, plus the 1% flip tax we’ll have to pay the co-op board, plus 1.4% we’ll have to pay the city and state for the tax on the sale, that’s 8.4% of the sale price that we wouldn’t get.”
In a tough real estate market, the Aronsons are hardly alone among New Yorkers in their quest to sell minus a broker fee. In the first half of 2007, metro-area homes comprised nearly 13% of the listings on ForSaleByOwner.com, which charges $89.95 and up.
Eric Mangan, an exec at the Web site, said use of the Internet to search for real estate has helped owners everywhere connect directly with buyers, but said New York “is one of our strongest markets.”
“Homebuyers tend to be very savvy with using the Internet and sellers understand that they can sell a house on their own,” Mangan said. “Plus, they look at the bottom line. … They take into account the cost of that 6% commission.”
Walter Molony, a spokesman for the National Association of Realtors, acknowledged that commissions often drive sellers to go without brokers, although “consumers also need to keep in mind that commission rates are sometimes negotiable.”
“But the other side of the coin,” he said, “is that [buyers] are dealing directly with the owner, so sometimes they think they can get a discount on the price.” He also said statistics “show that the selling price is lower when homes are sold directly by owners” — although the best-selling book “Freakonomics” argued that just the opposite was often true, since it pays for brokers to close a deal quickly and move on, rather than try to win a higher price, of which they’d keep proportionately little.
…
Although they haven’t sold their place in seven weeks, Jon Aronson is glad he and his wife are trying on their own. He acknowledged it requires considerable effort. He said there are potential advantages for buyers, as well; since do-it-yourselfers don’t pay a commission, they might be more flexible on price.That factor is just one reason Joseph Chang, 35, a magazine editor, prefers to buy directly from an owner. “Also, you may be able to preempt competition, as a seller may be not be willing to continue conducting open houses or showings if they’re confident they have a deal,” said Chang, who bought a Manhattan studio directly from an owner in 2006.
But the benefits of cutting out the broker can give way to impatience, he warned.
“You have to be willing to do the research on the local market [and] financing,” Chang said. “Few have the patience for this, however, and would be better off using a broker.”
From the AP:
Housing market maroons homeowners
At the new community of Seapine Estates, street names like Sea Foam Drive and Shoreline Road are meant to evoke a feeling of coastal tranquility. Instead, the two dozen or so residents of this New Jersey Shore development, near Atlantic City, feel anything but peace. The Pennsylvania builder went bankrupt last summer and halted work, leaving open foundations, unfinished homes and empty streets that have invited outsiders to dump trash, spray graffiti and race cars.
As America’s housing market has foundered, homeowners who bought into newly rising projects at just the wrong time have found themselves marooned in stalled, abandoned or largely unoccupied developments with little place to turn, placing a strain on them and municipalities forced to pick up the pieces.
Experts say it’s one of the least examined aspects of the housing downturn, and one that has struck many parts of the country, from areas like Las Vegas, which experienced rampant speculation and overbuilding, to cities where construction was more restrained such as the Jersey Shore and Philadelphia.
The housing market remains in the doldrums: All but one of 20 metropolitan areas showed home price declines in January from a year ago, down 10.7 percent overall, according to the latest figures from the widely watched Standard & Poor’s/Case-Shiller home price index. Sixteen of the 20 metro areas posted record lows, with Las Vegas and Miami tying for the weakest market. Only Charlotte, N.C., bucked the trend, eking out an almost 2 percent gain.
Ken Bachman, 37, who lives on a half-empty street in Seapine, feels trapped. When he leaves the house every day, he has to look at an unsightly, unfinished home across the street. Bankrupt Elliott Building Group of Langhorne, Pa., had planned more than 200 houses in the development with prices starting around $300,000, but residents say the community is only about a fifth occupied.
“It’s an undesirable place to live right now,” Bachman said. “Homes have been on the market for sale in here for over a year and they’re just not selling, because who wants to move into a development that’s bankrupt?”
One third of more than 200 cities surveyed have seen an increase in abandoned or vacant properties in their communities as well as other forms of blight, according to a report released last month by the National League of Cities in Washington.
(cont)
At the unfinished Seapine Estates, Denise and Kevin Urtubey, parents of a toddler, worry about the safety of their daughter. Cars have raced down the street in the middle of the night; a couple was found having sex toward the back of the development; tubs and other debris have been dumped in empty lots.
“It wouldn’t have happened if the neighborhood’s completed. It’s not a dead-end street. It’s just that nobody’s back there,” said Denise Urtubey, 27.
Like abandoned and foreclosed homes, unfinished houses and projects are not merely community nuisances. They also contribute to the glut of inventory dragging down the market.
From Bloomberg:
Long Island Home Prices Fall as Economic Slowdown Crimps Demand
Home prices in New York’s Long Island suburbs fell in the first quarter from a year ago and the number of properties for sale rose as the prospect of a recession and limited credit reduced demand.
The median price in Nassau County fell 2.3 percent to $449,500 and inventory rose 6.5 percent to 9,862 homes, appraiser Miller Samuel Inc. said in a report. In Suffolk, the median fell 6.5 percent to $360,000 and inventory increased 5.3 percent to 14,141. Prices in New York City’s borough of Queens rose.
“The market is certainly weaker than it’s been in the last couple of years,” said Jonathan Miller, president of New York- based Miller Samuel. “You’ve got prices that are generally flat, sales activity showing weakness and inventory rising.”
New York City had been largely sheltered from the decline in U.S. home prices that was spurred in part by rising foreclosures among subprime borrowers. Miller Samuel reported April 2 that the number of Manhattan apartment sales plunged 34 percent from a year earlier in the first quarter, the most in 18 years, as buyers faced job cuts at Wall Street securities firms.
“It’s not subprime, it’s credit in general,” that is hurting Long Island, Miller said. “Any time you place a restriction on credit, in this case tighter underwriting standards, you restrict the flow of sales activity.”
From Reuters:
Brokers feel a pulse in home market
While the data says “no end in sight” for the housing crisis, real estate agents are beginning to see signs of life among people looking for homes to buy around the United States.
It’s too early to talk of a trend, but lower house prices and mortgage rates are bringing buyers out of hibernation, at least in some markets. Provided sellers are prepared to cut prices, buyers are willing to bid, real estate agents say.
“If you’re not going for pie-in-the-sky type of numbers and price your house accordingly, I think that they’ll go pretty quickly,” said Victoria Hanbury Howard, a real estate broker at Coldwell Banker in Washington.
…
Once past those hurdles, buyers are finding choice is plentiful and they are looking for bargains.
Among those drawn by the lower prices and mortgage rates are Kristen Werner, a 30-year old attorney for an insurance company, and her 32-year-old husband James, who said they are now looking seriously for their first home after a lull of several years.
…
But, in a caution for sellers, the Werners are coming in with expectations of a bargain.
“We need something that’s in move-in condition — I’m not Martha Stewart and my husband’s not Bob Vila,” Kristen Werner said, referring to a domestic style-setter and the presenter of a home remodeling show.
“I just feel that in today’s market we can be a little pickier than maybe five years ago, and the seller has to put their house at market value and not inflate the price.”
“that’s 8.4% of the sale price that we wouldn’t get.”
Q: What’s 8.4% of 0?
A: ZERO
#1 “Only Charlotte, N.C., bucked the trend, eking out an almost 2 percent gain.”
Charlotte will be posting double digit YOY declines in a few months.
From MarketWatch:
Mortgage applications rose 2.5% last week: MBA
Applications filed for mortgages were up a seasonally adjusted 2.5% last week, while mortgage interest rates declined, the Mortgage Bankers Association said on Wednesday.
…
Filings to refinance existing mortgages rose 5.2% compared with the week ended April 4, according to the Washington-based MBA’s latest survey. Applications for mortgages to buy homes dipped a seasonally adjusted 0.8%.
From the WSJ:
LIBOR FOG
Bankers Cast Doubt
On Key Rate Amid Crisis
By CARRICK MOLLENKAMP
April 16, 2008; Page A1
LONDON — One of the most important barometers of the world’s financial health could be sending false signals.
In a development that has implications for borrowers everywhere, from Russian oil producers to homeowners in Detroit, bankers and traders are expressing concerns that the London inter-bank offered rate, known as Libor, is becoming unreliable.
Libor plays a crucial role in the global financial system. Calculated every morning in London from information supplied by banks all over the world, it’s a measure of the average interest rate at which banks make short-term loans to one another. Libor provides a key indicator of their health, rising when banks are in trouble. Its influence extends far beyond banking: The interest rates on trillions of dollars in corporate debt, home mortgages and financial contracts reset according to Libor.
In recent months, the financial crisis sparked by subprime-mortgage problems has jolted banks and sent Libor sharply upward. The growing suspicions about Libor’s veracity suggest that banks’ troubles could be worse than they’re willing to admit.
The concern: Some banks don’t want to report the high rates they’re paying for short-term loans because they don’t want to tip off the market that they’re desperate for cash. The Libor system depends on banks to tell the truth about their borrowing rates. Fibbing by banks could mean that millions of borrowers around the world are paying artificially low rates on their loans. That’s good for borrowers, but could be very bad for the banks and other financial institutions that lend to them.
From MarketWatch:
J.P. Morgan net falls by half; takes $2.6 bln markdown
J.P. Morgan Chase & Co. on Wednesday said first-quarter net income fell by half to $2.4 billion, or 68 cents a share, from $4.8 billion, or $1.34 a share in the year-ago period. Revenue fell to $17.9 billion from $19.7 billion.
…
“Our earnings this quarter were down significantly as market conditions and the credit environment remained challenging,” said Chairman and CEO Jamie Dimon.
From Bloomberg:
JPMorgan Net Drops 50% on $5.1 Billion of Writedowns, Reserves
JPMorgan Chase & Co., the third- biggest U.S. bank, said profit fell 50 percent after $5.1 billion of writedowns and provisions linked to the collapse of the subprime mortgage market and bad home-equity loans.
From the WSJ:
Merrill Upped Ante as Boom In Mortgage Bonds Fizzled
Fresh $6 Billion Hit Is Expected as Toll Of CDO Push Rises
By SUSAN PULLIAM, SERENA NG and RANDALL SMITH
April 16, 2008; Page A1
Some 10 months after the mortgage hurricane made landfall, Merrill Lynch & Co. is still trying to dig out.
On Thursday Merrill will report $6 billion to $8 billion in new write-downs, according to a person familiar with the matter. The latest would bring its total since October to more than $30 billion and mean that Merrill reports a third straight quarterly net loss, the longest losing streak in its 94-year history.
#11 MER pulls a hat trick.
Will they go four for four?
From MarketWatch:
Banker: Same problems as with LTCM, only bigger
The derivatives industry is facing many of the same problems as when it was dealing with the Long-Term Capital Management blow-up of a decade ago, only on a larger scale, a leading banker said Wednesday.
From Reuters:
Americans see buying opportunity in housing: poll
A majority of Americans think now is a good time to buy a home, although few believe the U.S. economy can escape a recession, according to a Reuters/Zogby poll released on Wednesday.
The survey of 1,049 likely voters found that 53.8 percent thought this was a good buying opportunity as home prices have fallen sharply in many parts of the country. Some 41.6 percent said it was not a good time to buy, and the rest were unsure.
From the AP/WSJ:
Euro Hits New High Against Dollar
On Record European Union Inflation
Associated Press
April 16, 2008 7:33 a.m.
BERLIN — The euro on Wednesday climbed to a new all-time record after the European Union reported that inflation in the euro zone rose to 3.6% in March.
The 15-nation currency soared to $1.5966 after the EU’s statistical agency Eurostat said that annual inflation rose on higher prices for transport fuel, heating, dairy products and bread. It was the fastest pace of price increases in 16 years
CPI due out at 8:30 along with the Housing Starts numbers. Later in the day we get the March NJ Employment/Labor report.
#11,
“To oversee the job of taking CDOs onto Merrill’s own books, the firm tapped Ranodeb Roy, a senior trader but one without much experience in mortgage securities. CDO holdings on Merrill’s books were soon piling up at a rate of $5 billion to $6 billion per quarter. This led to an inside joke at Merrill. Mr. Roy is known as Ronnie. Some employees took to saying that if they couldn’t find a specialized bond insurer, known as a “monoline,” to take Merrill’s risk on the deal, they could resort to a “Ronoline.” ”
How dumb can Merrill Lynch be?
“A majority of Americans think now is a good time to buy a home”
Great news. Much larger declines forthcoming.
18 posts of doom…..I’m exhausted….what a g-dd-mned clusterf—!!!!!
“Euro Hits New High Against Dollar”
We are increasing foreign debt at the rate of approx $1T, every 15-18 months. We are the largest debtor nation in the world. In conjunction with this, the fed is making the same mistakes as they did in the 70’s. This headline will be repeated many more times, down the road.
Chi,
Pick yourself up. This baby is just starting to crawl.
UGH. The chaps, across the pond;
“House prices have taken their worst battering since records began, a report published today reveals.”
“The study showed that prices are falling at the fastest pace for 30 years. It painted a picture of lower prices, few buyers and desperate sellers – with worse to come.”
http://www.thisismoney.co.uk/mortgages/house-prices/article.html?in_article_id=440384&in_page_id=57&ct=5
It’s been said before….when grim started 2 1/2 years ago, there was a lot of talk and one piece of gripping information came every few days. An enlightening article showed up every few weeks. Now, in the space two hours there is enough poo-poo to fill a case of diapers….
chi [23],
Yeah, I was called Roach-like, at that time.
WASHINGTON (MarketWatch) – New construction of U.S. houses plunged to the lowest level in 17 years in March, the Commerce Department estimated Wednesday. Starts fell 11.9% in March to a seasonally adjusted 947,000 annualized units weaker than the 988,000 pace expected by economists surveyed by MarketWatch. This is the lowest level of starts since March 1991. Starts are dpwn 36.5% year-on-year. Starts of new single-family homes fell by 5.7% to 680,000 in March, while starts of large apartment units fell 24.6% to 267,000. Building permits, a leading indicator of housing construction, fell 5.8% to a seasonally adjusted annual rate of 927,000. This is the lowest level of permits since April 1991.
This places Seiders on the pedestal with Joe Willie, call of the century?
“It’s now clear that we have entered what we anticipate will be a mild recession,” David Seiders, chief economist for the homebuilders’ group, said in a statement.
“Housing starts in the U.S. dropped more than twice as much as forecast in March to a 17-year low, signaling that declining construction will keep eroding economic growth this year.”
“Work began on 947,000 homes at an annual rate, down 11.9 percent from February and the fewest since March 1991, the Commerce Department said today in Washington. Building permits, a gauge of future construction, fell to a 927,000 rate from 984,000 the prior month.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=aLqmst6nAxmE&refer=home
chi [23]
Tow years ago I said to mo colleague that I would buy a house in hunterton county id prices were lower. He said: ” Prices will never drop there”
Few month ago he said – when are you moving to our neck of the woods – you can pick up some houses in a smaller towns dirt cheap… (He wants me to join their group iof crazy carpoolers.)
But Since I do expect gasoline to hit 4$ this summer and about 5:50 next summer in addition to 1 1/2 hour ocmmute to work on a good day – I said unfortunatelly I am not moving – have fun though.
Funny how things change it just 2 years.
Don’t worry, all this bad news is in stocks already ;)
Al Says:
Funny how things change in just 2 years.
2 years ago, I’d say at parties that the market might be heading into a downturn. People looked at me like I had lobsters coming out of my ears. Now when I’m at parties I say, “I’m just not seeing prices going down here in NJ”.
Everyone seems to have a anecdotal story about how the house around the corner sold for $150,000 less than a similar one sold for in 2005.
I let them tell me about it.
Still nothing resembling a decent value in Hunterdon under $400,000 yet though.
Still nothing resembling a decent value in Hunterdon under $400,000 yet though.
I think we have a bit different idea of “DECENT”.
Actually it make sense to sell on your own in a coop. The comps are public information for both the buyer and the seller. Plus all open houses must be pre-approved by the board and all pending sales must be approved by the board. So as a owner you already know how much your house is worth. Additionally, boards require pre-approval of tennants and if you do an FSBO you can pre-screen the applicants yourself. When I was selling my coop one girl single 29 professional with a 25% downpayment and a pre-approved mortgage seemed perfect until she came back and was measuring my very large living room. When I ask why is it so important to have a large living room she said her DJ boyfriend works a few nights a week and plans on moving in setting up his mixing boards and cutting his demo tapes all day. The other problem in my building was the old lady realtor across the street son was on the board and I was told she is “excelent at pre-screening candidates” so if another realtor is used we need to look extra careful at the application. However, if I did FSBO I was told since I was an owner I would be granted the same privledge of the assumption that I did some pre-screening. Well I am not giving 6K to a realtor to open my doors a few times! But the funny thing is when I had my open house I put fliers up on the telephone poles along with ads in the paper and the nice single IB auditor who bought it saw my flier as he was walking from his car to the realtor!!! Thank You Realtor!
BC Bob,
take “roach-like” as a compliment. The roaches may be some of the only ones to survive the nuclear holocaust!
On another topic, i have some interesting charts i need to finish compiling about our ongoing oil/currency discussion. i will try to wrap them up in the next day or so.
From Bloomberg:
U.S. Housing Starts Slide to Lowest Level in 17 Years
Housing starts in the U.S. dropped more than twice as much as forecast in March to a 17-year low, signaling that declining construction will keep eroding economic growth this year.
Work began on 947,000 homes at an annual rate, down 11.9 percent from February and the fewest since March 1991, the Commerce Department said today in Washington. Building permits, a gauge of future construction, fell to a 927,000 rate from 984,000 the prior month.
Foreclosures are pushing down property values by adding to the glut of unsold homes, prompting buyers to hold out for better bargains and undermining new construction. The Federal Reserve will probably lower the benchmark rate again at its meeting this month to cushion the economy against the housing- led slowdown.
“Home construction is probably going to continue to fall right through this year,” Mark Vitner, a senior economist at Wachovia Corp. in Charlotte, North Carolina, said in a Bloomberg Television interview. “While we see a bottoming in sales in 2008, we really don’t see an improvement until later 2009, early 2010.”
Everyone on this blog who actually goes out and looks at houses comes back on Monday only to post their disappointment at the outrageous prices for the piles of sh*t they were subjected to. All these stories of the sh*t hitting the fan everywhere except in our neck of the woods, where it might as well be 2005. A house that was priced at $829,000 reduced to $789,000 still doesn’t sound like a return to a normal trend line to me. But I know, just wait, I’m going to see some REAL bargains soon.
Gary – I think we haven’t even started to feel the effect of higher unemployment on housing. Wait a bit and effect of 25%+ lower comissions will hit million+ realtors outthere. Mortgage loan officers, construction workers, factories which produce building materials etc…
It all takes time.
The only wild card is bail-out by goverment in a form of abosolute bail-out – you have mortgage – well we will wave it for you. Just pay us back whenever you sell your house.
WaMu chart of Alt-A mortgages initiated May 2007.
11% of total pool was full doc.
http://bp3.blogger.com/_nSTO-vZpSgc/R-mjzUCruPI/AAAAAAAACXE/8enSJZ1WyjQ/s1600-h/Wa-Mu-neg-am-2007FEB.png
kettle:
What are thoughts on viable sources of alternative energy? We all know how corn-based ethanol is going to turn out. Bio-fuels are a no-go. Is wind/solar the way to go?
#3 Any time you place a restriction on credit, in this case tighter underwriting standards, you restrict the flow of sales activity.”
How about the pricing, is that not affecting the sales flow?
#34 – check out the forsalebyowner.com link from the orig. article. Yeah there’s a lot of over priced crap, but there’s also some interesting stuff that might be worth a closer look.
It might also be worth remembering that a lot of people aren’t reducing prices much because they can’t. The house was at $829 because they owed $810 in various debt on the place. They can only cut the price so much before they run out of cash to bring to a closing.
I get the feeling that there are a lot of cases like this, people on an inevitable path to bankruptcy.
3b They just want to keep the party going.
They can’t let the sheeple know its over,but they wiil find out soon enough.
Saw this on realtor.com…
Not just another Fair Lawn Cape! Super in & out!
To all the Cape haters, you really shouldn’t pre-judge a Cape before I know it.
JM
This is why my English teachers and I never saw eye to eye – “…I know it.” should be “…you know it.”
JM
Hello all,
Any tips/skills in buying a For Sale by Owner house. There is one that I am interested in, but the price is 10% higher than market price (my esitmation only). I have prepared the pre-approval letters from two banks, my CD that show them I will pay 40% downpayment. But I am afraid they cannot take the shock when I tell them the price I am willing to pay. Any suggestion are welcome.
Thanks,
007
#23
Yeah and I was getting ready for a spring 2006 rebound.
I was a big real estate bull. The only way you can still become a millionaire in Real Estate is if you start of as a Billionaire.
toshiro/Al,
I understand a lot of the underlying factors, I just wish we saw some real capitulation. It hasn’t happened yet.
tosh [39],
Exactly. There are a ton of properties where the seller has zero wiggle room. It’s either find a bigger fool or jingle mail. It’s time buyers qualify sellers before visiting a property. Is the seller qualified to sell?
In the better towns in our area, how many buyers in the last five years put little or no money down on those mid-level homes? Is there some data someone can point to? The majority of the open houses I’ve been to lately have been retired or widowed folks who are asking prices based on the ponzi scheme from 2000 onward. The don’t understand that the actual list price should be about 20% less.
Nor do the retiring baby boomers who bought 15 or 20 years ago and think they deserve the 2005 price their swinging buddies up the street got. How many short sales or distress sales are going on right now Northern Bergen or West Essex? Again, if you want that cape in Fair Lawn on a 50 X 100 lot, then by all means. Anything a half-step up from that and you need a hazmat suit on before you walk in the place.
gary Says:
April 16th, 2008 at 9:30 am
toshiro/Al,
I understand a lot of the underlying factors, I just wish we saw some real capitulation. It hasn’t happened yet.
How many low-balls (fair value offers) did you submitted last year/this spring?
Start doing that. With, lets say, 4 day’s expiration deadline you can submit 7-8 offers in a month.
come back after 3 month and let us know of your results. Personally I haven’t seen prop-erty I liked to even submit offer – but that is because I was looking only at lower priced homes and they are all piece of falling apart $h1t. Literally.
Pret Please Read:
U.S. Financial Services Professionals’ Bonus Outlook and Job Confidence Deteriorates
http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/04-16-2008/0004793752&EDATE=
Victoria 37
There are certainly viable alternatives. The issue is implementation. Our current society is built around having easy access to an extremely energy dense liquid fuel that has an EROEI on the order of 10 or greater ( this means that the amount of energy that we get from the liquid is at least 10 times more then the amount of energy we have to use to extract it). Most alternative forms of energy that are viable on a large scale do not provide energy is liquid form at anywhere near an EROEI of 10+. at and EROEI or 3 or less you will probably use more energy creating and transporting the fuel then you would ever get from it, a net negative operation.
The ultimate solution will probably be a “basket” of sources, a combination of wind, solar, nuclear, hydro, geothermal, etc depending on which source is best suited to the geographical location it is being sourced at.
The hard part is that to fully utilize these sources require a massive restructuring of modern society. The current car/suburb/energy structures we use cannot efficiently utilize these alternative power sources. people do not generally like change and people will probably have to b forced to make these changes and will most likely be forced by an upheval in price and availability as the oil age declines.
The 2nd big hurdle is the actual rebuilding of societies infrastructure. Restructuring our society to utilize alternative forms of energy will be very expensive in both terms of $$$ and energy. The longer we wait to do it the more expensive it will be.
This will happen and will happen in your life time if you are not a boomer and may even happen in your life time if you are a boomer.
In my opinion the most viable alternatives are wind/solar/Nuke/hydro/geothermal. Most of the biofuel methods will only work in a niche environment and will not work on a national/global scale. One potential exception is Algae biodiesel, but that is a very big MAYBE, as it is not a mature technology yet.
Al,
Personally I haven’t seen prop-erty I liked to even submit offer – but that is because I was looking only at lower priced homes and they are all piece of falling apart $h1t. Literally.
That’s how I feel about the “step up” homes. Believe me, when I submit, this blog will be the first to know. I already did one last fall for 15% under… obviously, no dice.
Victorian Says:
April 16th, 2008 at 9:07 am
“kettle:
What are thoughts on viable sources of alternative energy? We all know how corn-based ethanol is going to turn out. Bio-fuels are a no-go. Is wind/solar the way to go?”
OK, I’m not kettle, and he appears to be the expert. However I have been seeing a growing contingent of environmentalists talking nuclear. As it was the boogyman to the greens for a long time, it has particularly grabbed my attention.
Prime mortgages “are getting worse”: JP Morgan CEO Dimon
Dramatic decline in housing starts, rise in CPI, and lackluster results from JP Morgan,and the market is up?
Inflation. Dollar worrth less – stocks cost more.
Al Says:
April 16th, 2008 at 9:46 am
“Personally I haven’t seen prop-erty I liked to even submit offer – but that is because I was looking only at lower priced homes and they are all piece of falling apart $h1t. Literally.”
I’m in the same situation. Sometimes I look at the higher priced properties out of curiosity and there are a h*ll of a lot out there – kind of like the overhang on the mountain that becomes an avalanche. I honestly don’t see that there is a market for all of those half a million dollar aging ranches and capes and splits without speculators and funny financing.
How is the Spring 2008 rebound going so far ?
http://www.nytimes.com/2008/04/16/nyregion/16tourism.html?hp
Foreigners Sustain New York’s Economy
Published: April 16, 2008
New York City has started to slide into the economic downturn that is enveloping much of the country. But the city has a counterbalance against recession that few other American cities share: a rising tide of free-spending foreign visitors.
After a record year of tourism and business travel in 2007, the influx has continued to grow this year, city officials said. About one million more visitors came to the city — more than one fifth of them foreigners — in the first three months of 2008 than in the first quarter of last year,
“3b Says:
April 16th, 2008 at 9:52 am
Dramatic decline in housing starts, rise in CPI, and lackluster results from JP Morgan,and the market is up?”
It’s all priced in ;) Until the bulls wake up one morning in a panic and decide it’s not.
mr potter Says:
April 16th, 2008 at 9:56 am
How is the Spring 2008 rebound going so far ?
Everything is Good. Economy is Picking up – recession is expected to be mild, inflation is slowing down – core inflation was only 0.2% last month – Fed is expected to lower rates again and this will lead to pent-up demand in housing in the summer/fall month. After sommer/fall inflation will cause house prices to go even higher. Right now is a rare and very short window of opportunity for buyers to get into the market. Espetially for people downsizing or moving up., as well as first time home buyers. Investors might find some rare deals as well.
Call your local realtor, sponsor baby boomer retirement. If you are a baby boomer – buying a house will help you retire.
Remember this is just very smallexample on what I bring to the table. If elected as NAR Chief Economist I will post my updates of housing markets daily with underlying positive economic news and Remember – owning a house is am AMERICAN DREAM!!!
Vote for me as next NAR Chief Economist.
P.S. My salary requirements are negotiable, based on comparable pay for CEO for companies with 1000000+ members…
“and the market is up?’
3b,
Bad news is good. Worse news is better. Disaster is best.
50 Ket-
Thanks for your detailed answer.
Please correct me if i am wrong, but AFIK, automobiles are the largest consumers of fuel. I would think that if we make them more efficient consumers of energy or wean them off the oil, this would have a big impact on the energy equation, no?
Lisoosh: Do you have an idea as to what has changed? or a link to where the opinions are expressed? Thanks.
#3 Any time you place a restriction on credit, in this case tighter underwriting standards, you restrict the flow of sales activity.”
The fact that lenders are no longer giving 107% 1 year interest only ARMs to people with bad credit based on non-existent “stated” income doesn’t qualify as “tight credit”.
I don’t think credit is particularly tight right now by historic standards, especially for conforming loans. You just need decent credit and a down payment. To borrow a phrase from a realtor in 2005 trying to talk me into an I/O loan, “this is just the new way people buy houses now”.
BC Bob,
RE news/market
This is all starting to sound like a bad direct to DVD movie
Re NYC:
At the rate we are going, NYC may be headed back to its late 70’s early 80’s character. People might remember why Gotham city was modeled off of NYC
“On Thursday Merrill will report $6 billion to $8 billion in new write-downs”
That CAN’T be true! bi and S&P said there would be no more writedowns!!
#65 njpatient:On Thursday Merrill will report $6 billion to $8 billion in new write-downs”
So!! Merrill is part of that vast sea of knowledge, and talent, and they were just kidding. I am sure if you just give them time, they can put it all back together again.
#14:
The survey of 1,049 likely voters found that 53.8 percent thought this was a good buying opportunity as home prices have fallen sharply in many parts of the country. Some 41.6 percent said it was not a good time to buy, and the rest were unsure.
I wonder what percentage of the 564 people who think it is a good time to buy are trying to sell their current houses.
#61 Bc Bob: Yes. I am just so glad I am living in this vast sea of talent and knowledge.
This would be hilarious if it were not so incredible..
“Stocks Rally on Earnings- AP
Wall Street rallied Wednesday, led by robust first-quarter results from JPMorgan Chase & Co., Coca-Cola and Intel.”
Reconcile this with…
“# JPMorgan Chase’s Profit Drops 50 Pct in 1Q- AP “
“At the rate we are going, NYC may be headed back to its late 70’s early 80’s character.”
kettle,
I don’t know about NY. However, the fed is taking that 70’s road. Step back, into the future.
Artemis Says:
April 16th, 2008 at 10:20 am
#14:
The survey of 1,049 likely voters found that 53.8 percent thought this was a good buying opportunity as home prices have fallen sharply in many parts of the country. Some 41.6 percent said it was not a good time to buy, and the rest were unsure.
I wonder what percentage of the 564 people who think it is a good time to buy are trying to sell their current houses.
I made this comment a while ago when 63% of people thought it was time good time to buy a home – I said that % of homeowners is at 69 – so basically only homeowners think it is a good time to buy a home. Today’s homeowner is tomorrow home seller.
62 Vic
Nuke is coming back into favor. I wont write a book, but the quick and dirty is it is the highest energy density power source we have besides oil. and the hype of there is only 50 years worth of nuke fuel is patently false as that factoid is based off of VERY limited assumptions that are not accurate in any way. The US GOV has fast tracked several dozen nuclear permits recently.
Your efficiency idea is a valid, but unfortunately ineffective method. It can already be shown using world oil consumption data that even if you increase our efficiency drastically, any oil savings will be negated as the unused amount will now be used by china or india etc. World demand for oil is greater the supply and efficiency only works to slow the problem. And it will only slow the problem in a static economy with no growth in usage. India and China have rapidly growing industrial sectors and middle class populations. The growth in middle class populations alone ( and their subsequent oil usage) negates any possible efficiency gains we could ever make.
The problem is global, the only 2 solutions are to resolve the issue globally or to isolate ourselves from the global economy and community and solve the power problem locally. option 2 will NEVER happen and would probably have disastrous consequences anyhow.
70 BC
BACK TO THE FUTURE…….. PART IV!!!
#59 hehe; Oh I know, JP’s #’s were slightly above investor expecations. I guess they have very low expectations, where bad is good.
However the other 2 Houisng and CPI), taken together with JP’s, is a lot of poo-poo to price in.
47….I like the ‘idea’ of buying from the elderly owner….issue there is you are going to completely rehab the place. Usually talking 50 year-old electrical…windows….roof….etc….been there done that. Not again.
3b,
I was being sarcastic
Is Sharpe James going down? Apparently the verdict is in.
http://www.nj.com/news/index.ssf/2008/04/b_verdict_reached.html
8 grim
interesting.
disturbing.
The state of NJ annoucned today the restructuring of 1.7 billion in muni auction debt, that will be converted to a combiantion of Fixed rate/Variable rate.
This refinancing will eliminate about 20 seperate muni auction deals that the state had with various broker dealers.
Whoooaaa!
#76 hehe: I know, I was trying to be sarcastic back, did not work sorry
14 grim
“The survey of 1,049 likely voters found that 53.8 percent thought this was a good buying opportunity”
I wonder how many of those likely voters are trying sell?
Shapre James is convicted of Fraud!
http://www.nj.com/news/index.ssf/2008/04/newark_ex_mayor_sharpe_james_convicted.html
Has anyone looked into building an electric car as a hobby or project?
I have been doing the research and have performed a rough cost/benefit analysis and realized that you would have to drive the thing forever before it pays off.
10-20K to build depending on quality of parts
50-60 Miles Max Distance – Battery technology sucks (Lead Acid) or it is in accessible and ridiculous expensive(Lithium Ion/NiCad)
Life of Vehicle and Repairs – Who knows
But it would be loads of fun!
Hypothetical question – better to keep a 30 year fixed mortgage (say around 6%) and invest ones wealth in a balanced portfolio (assume 8% to 10% return) over the next 20+ years, OR better to take that money and pay off the mortgage?
The question is really more about:
1. The economy – will stocks, funds, etc grow enough to really return 8%?
2. Inflation – if you think there will be a lot of inflation, doesn’t it make sense to keep the mortgage and pay it back with depreciated dollars?
3. Dollar – not sure how this figures into it, but there is some risk of a serious dollar problem going forward. However the mortgage has to paid back in dollars, so…
And I think the price of fuels (really oil) will go through the roof over the next 20 years, stoking inflation, bringing down rates of returns on capital.
Opinions?
vIC,
Pound for pound, Nuke has the potential to be one of the cleanest high density energy sources available.What is generally considered nuclear “waste” can actually be reprocessed into additional nuclear fuel. And some reactors (breeders) create more fuel then they use (no this does not violate thermodynamics, there is a net decrease in energy and an increase in entropy). The traditional issue has been that he US gov doe not want nuke tech to spread and a robust nuke industry will spread the tech.
The biggest hurdle to Nuke is politics. The funny thing is that the 2nd hurdle is globalization. There are only a few companies that can make some of the parts that are needed for nukes and a lot of these companies have gone overseas or gone out of business. counterfeit reactor parts have now become a problem because of the outsourcing. if we really go nuke we need to bring back the homegrown industry but this takes time and will hold up nuke construction.
and you though counterfeit purses were a problem!
Essex [75],
Yes, buying from an elderly owner sounds like a plan; except that the elderly owner believes that nose bleed and concussion prices for their “dated” home is justified.
BC Bob
“We are increasing foreign debt at the rate of approx $1T, every 15-18 months. ”
Yeah – and the folks sailing this ship of fools seem to have forgotten that you’re supposed to inflate the debt BEFORE you deflate the dollar, not after.
Jeebus.
I agree with the opinion that one can deal without a realtor as we can find very useful websites providing information on the real estate issue and one may think that the role of the realtor became unimportant. During my search for one of the affordable but still spectacular Toronto houses I made a profound research but couldn`t make up my mind without the help of a realtor. Hiring a professional I think it`s still beneficial as the realtor can warn you what kind of problems should occur.
87 gary
form their point of view they are justified. For many boomers the majority of their retirement depends on those nosebleed prices, other wise its time to invest in friskies!
Steve,
Owe dollars and own Swiss Francs, Euro’s, Australian Dollars and GOLD.
Sit back and pay off your mortgage with pennies on the dollar.
Sorry for the OT politics rant –
It is a sad time when the only credible/sensible piece of news analysis comes from Jon Stewart.
Any person aspiring for the office of the President of the United States should be better than the Average Joe. Nobody selects an average person to be the CEO of a company. Why should the election of a president be different?
NJ #88,
Does it really matter.
Have you ever heard of any nation in history that has devalued itself to prosperity?
TJ 84
If you believe that we are headed for an energy crunch then the pay off on that electric car is shorter then you think. how do you calculate the saving of not being in gas lines?
#87 gary: In many instances, the elderly are the worst as far as lowering prices,
There was an elderly couple I approached a couple of months ago, (and I mean elderly), they had tried to sell their housee for over a year, fianlly took it off.
When I approached them with an interest to purchase, they declined, said they were going to wait until the market gets better.
You would think that at this point they would be ready to move on, but no.
35 al
“The only wild card is bail-out by goverment in a form of abosolute bail-out – you have mortgage – well we will wave it for you.”
I think that would cause prices to plummet like a lead balloon.
39 tosh/45 BC Bob
Agree – this is what creates the illusion that prices here aren’t falling – it’s as grim says repeatedly: ASKING prices aren’t falling (because as tosh and BC point out, they CAN’T – until the keys get mailed to the bank).
I shudder to think how fast the bankruptcies will fly when all the folks who are upside down finish maxing out their Visas.
Gary, the elderly owner is not the only one who believes a nosebleed price for a severely dated home is justified. His/her heirs do, too. I looked at a house in a good Bergen town but bad location (next to a parking lot). Estate sale…very outdated kitchen and bath, peeling paint inside and out. September 2007 price: $479. November 2007 price: $459. Today’s price: $429. Drip, drip, drip.
kettle1,
For the most part I was not using the idea of an energy crunch (fossil fuel) as my motivation rather it was for pure economic purposes. I would just have thought the ROI would come faster. But you know, how can you factor in “cool” into ROI.
Have you seen those solar concentrator dishes that beam light to a central point from a dish and heat up a gas to produce electricity (Looking for Article)? It is supposedly many times more efficient than solar cell technology.
I found this. Pretty recent, but not the same thing. Any thoughts.
http://www.physorg.com/news119107136.html
“Start doing that. With, lets say, 4 day’s expiration deadline you can submit 7-8 offers in a month.”
Al, why not just make multiple offers, each subject to the earlier acceptance of the others? Then (a) you can make as many offer as you want and (b) you’re putting the seller on notice that they’re not the only dog in the fight.
Figures gathered by Rolls-Royce suggest there are 80,000 people in the UHNWI category around the world.[4] They have, on average, eight cars and three or four homes.[4] Three-quarters own a jet aircraft and most have a yacht[4].
The number of high net worth individuals worldwide is estimated at 9.5 million. HNWI wealth totals US$37.2 trillion
Interesting numbers.
58 ada
“Foreigners Sustain New York’s Economy”
That’s known around here as “human capital”, buddy.
here you got TJ
http://pancamo.blogspot.com/2007/07/ses-solar-dish-stirling-system.html
TJ
its good stuff with real potential and it is scalable, there are already several solar thermal plants in operation in the southwest desert, spain has several as well. But its just one piece of the puzzle, not the solution by itself.
the efficiency of the Stirling system i linked to has been at about 30% the best solar electric is currently about 18-20%
86 – Ket
This would be the best way to create American jobs for the American economy. Instead of mailing out stimulus checks for people to spend, they should be investing that money into such endeavors, which would employ people who in turn will spend money.
3b/Gary,
I wish I could tell you about how crazy this old old couple was at a house that I bid on.
They were so old, no lie, that they slept in individual full size beds with knitted blankets, pillow cases, everything.
They were very kind and gave me a grand tour of the cape. As we walked into the kitchen he described it as “update” followed by the fact that he spent 3 months salary updating it in the late 70’s. He point out the newer stove (circa 1990) and said it was very modern because it lights the gas itself with a spark of electric.
Needless to say they didn’t accept my offer, or anyone elses and still live there.
artemis at 67, I see you beat me to it at 82
Results from my town yesterday’s school budget vote, the local school budget passed this year by 17 votes, (failed last year by 9).
The old timers who man the polling stations tole me last night that the turn our was extremely light.
The regional school budget (2 towns combined middle and high school), failed.
My un-scientific review of the results of Bergen Co shows that in the more modest towns the school budgets for the most part passed, and in some cases by fairly significant numbers.
However in the more “prestigious” Bergen towns, such as Wyckoff, Montvale Ramsey Wood Cliff Lake,Montvale the school budgets were all voted down.
Ridgewood bucking the trend voted yes, although there was a substanial amount of people in that town who voted no.
TJ
the main reason for you building an electric car being expensive is a lack of economy of scale. building a gas car on your own would be more expensive then buying one as well in most cases.
re: (84) No vehicle really pays for itself. It depreciates from the second you buy or build it.
I built an electric go cart when I was a teenager using lead acid car batteries and a starter motor from a car. Lots of torque and lots of Fun, that is until the batttery died which was about 15 minutes.
And now 20 years later, I just took delivery on a 2008 Saturn Vue Greenline hybrid. For 25k you can have your cake and eat it too. It is a small SUV with a curb weight of 4325 lbs. I have been getting up to 38 mpg on the highway and around 25 mpg local.
93 make
“Does it really matter.”
My point wasn’t that it works; it was that the people who claim that it works aren’t even doing it right.
105 ket
“the efficiency of the Stirling system i linked to has been at about 30% the best solar electric is currently about 18-20%”
I’d like to see where we got on solar if we put, say, $600 billion in R&D into it over the course of 6 years.
annamelbourne [98],
Yup, I know all too well.
njpatient,
With that kind of money you can build enough of these Solar Concentrators utilizing a Sterling engine to power the US. At 500K a pop that would give you about 1.2 million of these things. I think that is more than enough. Problem solved:)
America’s wealthy see buying opportunities in sluggish real-estate market
I personally don’t like this kind of targeted surveys to basically pump any good story. Why don’t they take larger survey and that includes renters vs current owners. Anecdotally, most people who currently own will tell right now is good time to buy, while most who rent, will tell they will wait till market stabilizes.
“Here Comes the Next Mortgage Crisis”
“Subprime was just the beginning. Wait until California’s prime borrowers start handing their keys to the bank.”
http://www.slate.com/id/2188982
115 TJ
Great! And even Kudlow was saying that $600B is not a lot of money the other day. Let’s do it!
I propose that in order to have the people of the US really understand the scale and quantity of dollars being spent, written down and thrown away, we change the word BILLION to SUPERQUADJABILLIONMILLIONHOLYCRAP just to emphasize the fact that although 1 million dollars is a lot, 1000 1 million dollars in a whole freaking lot.
Any suggestions for 1 Trillion dollars.
FYI
with current solar tech it has been calculated that a 92-mile by 92-mile solar farm in the desert southwest could power the entire country. Oh and it would cost about 100 – 300 billion to build. real cost would be expected to hit 500 – 600 billion after over-runs and the usual 5000 dollar hammers.
That is a heck of a lot cheaper then the iraq war!
120 – Ket
Dumbfounded!!
Why arent the third-world countries investing in this?
another promising solar tech
http://www.ausra.com/
116 SG
I dislike it for a different reason – wealthy in this case means “discretionary household income of more than $500,000 a year” – i.e., AFTER taxes and non-discretionary spending (housing, food, clothing, employment-related transportation, etc.), the folks in this survey still have $500K to light on fire yearly.
That survey is relevant to 0.1% of the population, for whom it’s always a good time to buy.
120 kettle
That was my point.
Victorian
to be fair there are definate logistical issues that would have to be solved suck as thermal energy storga e for night t ime power generation ( we already have the etch and use it on small scale), as well as needing to update the US power grid, ( another 5 – 10 billion).
The biggest problem is that it would devistate the current power geneartion and distribution companies in the US. It would essentially put them out of business. There are to many vested interests that would be hurt by this. I am normally a fairly environmental guy, but for this i say screw the ground squirrels build away!.
oh and you could power all of europe with a 120 mile by 120 mile installation in the sahara
“oh and you could power all of europe with a 120 mile by 120 mile installation in the sahara”
er – what about Africa?
a 92 sq mile desert installation could be built in about 8 years but brought online as each segment was completed. the first portions could be online within 1-2 years from start of construction.
One more draw back…. it is actually possible that we would need to nationalize some resources such as silicon during the period of construction due to the astronomical spike in resource use during construction otherwise you run into some construction resources becoming as expensive as precious metals. it depends on the details of how it would be implemented.
Kettle1/Victorian,
That is until we develop a large enough Penning Trap to harness anti-matter from the depths of space and bring it back to earth.
My boss’s boss makes the big kahuna makes a NINE figure salary. Now we are talking a whole new lifestyle bigger than Oprah!!!!
I remember back in the 1980s or so Ron Perlman bought a house on Dune Road for something like 3 million dollars back in the day (crazy money in the 1980s for a summer home), well dune road is a flood zone and the house could not get flood insurance. The famous quote Ron Perlman gave when asked how he could spend 3 million for a home that could be taken away by a single way? His answer it is not that big a deal as that is only one day’s pay for him.
Talk about a playa.
Mish on Oil and The Dollar etc:
Why Do Oil Prices Keep Rising?
http://www.minyanville.com/articles/crude-Fed-oil-gasoline-inflation-consumption/index/a/16749
TJ
if we are at that level of tech i suspect we will have come up with a better method, that seems kind of like going from NJ to Wisconsin to get your milk…. but hey who knows!
We need to start building Nuclear Power Plants in the US. Solar is wimpy. A few years back Mitsubishi tried to get a Nuclear plant built right in death valley and said they could run lines under dessert and power all of Vegas!! With left over power to cover parts of LA. Well they said the dessert wildlife and plants would be effected and they said no. Mitsubishi said I give up the damm US won’t even let us build in a wasteland.
Also Claymore just issued this Solar ETF yesterday, saw it on Fast Money:
http://www.claymore.com/tan/
John NIMBY is an issue with Nuke. All of the current successful permits have been foe new nuke facilities built at existing nuke sites. There are other issue however, you want a nuke plant run like the navy does. with no regard for cost. failure of a nuke has to high a consequence otherwise. having a normal for profit business run nukes ensures built in conflicts of interest. Like healthcare, nukes should be run by non-profit agencies who sole purpose is to safely supply power
#100 njpatient,
njpatent, could you point me to any link that give hints on how to write an offer letter. I am totally new at buying a FSBO house.
Thanks,
007
Re: elderly sellers: Good Lord, yes. We bought our house from the original owners. Point of contention was the electric, which was 100 amp service via an old 60 amp fuse panel with another auxilliary panel off of it. We needed a full upgrade, including a mast because the garage was slapped onto the outside of the house so the electric was coming into the house through the garage. Seller was insulted that I wanted to be able to have a clothes dryer, after all, the clothesline from the house to the big oak tree in the backyard was enough for HER, why wasn’t it good enough for me? New yellow geometric sheet vinyl floor, crappy refacing job, and harvest gold appliances were done 1975-1980, and that was an “updated kitchen” in 1996.
I’m told that in addition to the red carpeting (which is wool and still in the house, alas), they had black-and-gold flocked wallpaper that the realtor made them remove.
And this guy used to spend hours trimming his shrubs. His motto was “curb appeal.”
Balls? I guess I have them :)
I’ve been reading here how lowballs are frightening to offer and that a lowball is 90% or less of an asking price.
Last year, about this time, I offered about 18% of asking price without batting an eye. House was in condemned condition and I had no problem offering 82% LESS than what they were asking for. Seriously. Why is that a problem?
It’s under contract now for probably 40% of original asking price, a haircut of around 60%.
Lowball away…
Kettle I diasgree. Japan is powered almost 100% mainly by nuclear mainly run my Mitsubishi but GE also makes some of the equipment. They are very safe.
njpatient Says:
April 16th, 2008 at 11:06 am
“Start doing that. With, lets say, 4 day’s expiration deadline you can submit 7-8 offers in a month.”
Al, why not just make multiple offers, each subject to the earlier acceptance of the others? Then (a) you can make as many offer as you want and (b) you’re putting the seller on notice that they’re not the only dog in the fight.
It is very simple – the moment you have an offer letter which is different from standard one (clause for financing, and repaires only) sellers will get jittery and not even consider your offer. Standard offer is the way to go. Right now I ma finding it difficult to even find one house a month I want to make an offer on. I am not going to make more than 25% off current listing price offers – chances of that going through are slim.
And the moment a house getting withing 15% lowball range in listing price – somebody buy’s the house for 5K off listing price – seen it over and over again last year.
Spring is bad time to buy – I guess I will wait untill september/november – last eyars few houses went for about 10% less in october than very similar ones in spring.
#139 Al:And the moment a house getting withing 15% lowball range in listing price – somebody buy’s the house for 5K off listing price – seen it over and over again last year.
???
BTW – lowballs are not frightening – just have to find a realtor who is willing to submit your lowballs. My father in-law made a 33% off offer on new (2 years old) house in Tucson, AZ last year. Sellers did not accept it. Last february they called him and asked if he is still willing to honor his offer – he said I am sorry but market have changed, asked for another 10% off…They reluctantly agreed. Deal fell apart after owners refused to leave appliances in.
Right now my father in-law is buying house in retirement commuunity for 1/2 of the price… 1 mile down the road from thouse people house.
But I would say NJ hasn’t being hit with unemployment yet…. Or just starting to being hit. Wait untill fall/winter.
3b Says:
April 16th, 2008 at 1:23 pm
#139 Al:And the moment a house getting withing 15% lowball range in listing price – somebody buy’s the house for 5K off listing price – seen it over and over again last year.
???
Example: Cape starts at 299K. I would offer may be 230 as it needs: electric, new roof, new oil tank, sewer hook-ups and full cosmetic remodel – house in untouched from 1970th.
Slowly – over the course of 4-10 month it drifts down to about 265K. So not 230K is withing 15% lowball.
But someone comes in and buys the house for 255K…
Average family incomes from census 2006 for family in this area are at 81K.
This is very basic starting cape, not an average home, on normal 50/100 lot. Nothing upgraded, no cetral AC or new heating system – old good cast iron radiators. People do nto looka t the values – they look at the original listing price and 255K sale price and say: COOL we got 45K off.
Ohh yes I forgot 6k+ taxes
Re 142 but how much is he land worth? When I sold my mothers fairly original condition house for 550K, the land was worth 490K so the house was sold for only 60K. The house was in perfect condition, but the kitchen was from 1973 and the electricity needed updating. But everything worked fine. You could have rented it out the day after you bought it. Unless it is a complete wreck where it is a teardown a lot of estate sales I looked at the house was only being sold for 50-100K, it was the land that cost a lot.
Plus pre-real estate boom people in NJ were spending 4x salary. So 81K average income translates into a 324K house, so at 255K the average buyer has a budget of 70K to renovate.
http://www.cartoonistgroup.com/store/add.php?iid=22806
what is with you guys and offer letters? Every house I ever bought and sold we verbally did price and Monday morning our two lawyers hashed out the particulars of the deal. The only purpose an offer letter serves is to let the greedy realtor a chance to use her form to lock in her commission.
BC 144 A good one.
having a normal for profit business run nukes ensures built in conflicts of interest. Like healthcare, nukes should be run by non-profit agencies who sole purpose is to safely supply power
If a nuclear power plant were built today, it would have to done in a regulated power market. It’s unlikely a bank would finance a nuclear plant unless it received rate-base treatment (i.e. utilities get to pass the cost along approved costs to ratepayers via a power authority or public utility commission). This type of financing structure reduces the incentive to cut corners.
Re 142 but how much is he land worth?
This is a good question – how much is 0.14 of an acre of non-producing land with 6K taxes ??????
IN Mahhattan, for some reason – millions, in Wyoming – nothing.
Crude up to $114.95 today. If the credit crunch doesn’t kill you, that will.
3B this is for you
Goldman Sachs and Wells Fargo warn ‘delusional’ investors on stocks
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/04/14/bcngold114.xml&CMP=ILC-mostviewedbox
How long till we see 150/barrel?
I’m contemplating a 50% offer on an REO.Needs some work 30k should do it. I was waiting till after the spring that wasn’t.
Now I’m starting to get antsy. I must be patient I tell myself so Mike keeps waiting.
Now I’m starting to get antsy. I must be patient I tell myself so Mike keeps waiting.
It is the Spring… Everybody gets antsy – exited for summer to come…
New Beige Book:
http://www.federalreserve.gov/FOMC/BeigeBook/2008/
NYC Housing From Beige Book:
Construction and Real Estate
Housing markets in the District have continued to cool off. Manhattan’s co-op and condo market showed clear signs of cooling in the first quarter, according to a major appraisal firm: unit sales fell 30 to 40 percent from a year earlier, while the number of listings rose, although inventories remained fairly tight at the high end of the market. The average reported transaction price did increase, but this was attributed to relatively brisk sales at the high end of the market (largely newly-built luxury units). Noticeable declines in sales are also reported in Brooklyn, Queens and Long Island. Northern New Jersey’s housing market is reported to have stabilized, but at low levels. An industry contact notes that buyer traffic is light, and that many prospective buyers are hesitant, waiting for prices to decline further. The number of listings has increased, and, in contrast with Manhattan, the high end of the market has been accumulating inventory at a more rapid pace than the rest of the market. The “active-adult” segment is noted to be particularly slack, reflecting above-average inventories and particularly weak demand. Prices for new homes are estimated to be down as much as 20 percent from a year ago, while prices for existing homes are seen to be off 15 percent from their peak levels. Finally, New York State Realtors indicate further marked declines in the single-family market in February: the median selling price is reported to be down nearly 12 percent from a year earlier, while unit sales are reported to be down 19 percent, with some of the sharpest drops in the New York metro area.
Commercial real estate markets have also slackened. Vacancy rates rose moderately throughout the New York City metropolitan area, led by somewhat large increases in Central New Jersey and Westchester County. Asking rents on Class A properties rose moderately in Manhattan and Fairfield County, though at a slower pace than in 2007; rents were flat to down slightly in Long Island, Westchester and northern, as well as central, New Jersey.
I addition: I looked at the same capes – in 1997-1999 they were sold at 124-150K… depending on the conditions.
dough 151
my new tears prediction was we would at least touch $150/brl by the end of 08. we will see….
Is there any general sort of correlation between tax assessments and home values? either for the land portion of the property or for the whole property ( home and land)?
#158, tax assessment depends on land and the way land is used (house sq ft etc). If town plans to raise tax, the major factor will be the total number of house sq ft. Land shrinks, but home grows.
Vic – I’ll need to dig around.
I remember one guy, Steve something, was one of the founders of Greenpeace. He left in part over the demonization of nuclear energy which he felt was in part of pseudo science and the tying of it to nuclear weapons in many peoples minds. There was an article on him recently in Newsweek.
Another one is actually the guy who came up with Gaia theory and also predicted global warming. Don’t remember his name. I will look for the article though.
138 John: RE 100% Nuclear power in Japan
Stop talking out your azz. Japan currently gets less than 30% of their total eletricity from nukes.
http://en.wikipedia.org/wiki/Nuclear_power_in_Japan
http://www.asiasentinel.com/index.php?option=com_content&task=view&id=1149&Itemid=32
You were partially correct however about Mitsubishi/GE. Toshiba (who I work for) supplied roughly 1/3 of the boilers and turbines in the Japanese lectric utility market (almost all those on the 60hz side) and have been the #1 supplier of steam turbines in the US for each the past 7 years based on MW, not # of units).
Vic – Here’s one article on James Lovelock, the Gaia dude:
http://www.guardian.co.uk/environment/2006/jun/08/climatechange1
Quite depressing actually
#6 bairen
Charlotte didnt go through double digit gains just a steady year over year increase no big jumps even with the influx of people moving to the area it didnt get out of control so I am not sure where you can come up with double digit losses to an area that didnt bubble out of control. There were no HGTV shows of 1100 sq ft for $700,000 here.
Yes we have some fluff but are still a lot cheaper than places in the north with comparable pay rates on a lot of jobs. Still a lot of people from the north coming this way because of how much cheaper it is. Taxes, Car Insurance, etc included.
Do I expect Charlotte area to decline? yes to a certain degree but recently it has only slowed and the reason for the slowness is that people in places like NY/NJ cant sell to move to Charlotte.
Is Charlotte invincible? Heck no. No place is invincible. But since it still has steady job growth, virtually no housing bubble, and development growth it stands to hold its own.
Either way losing 10% on a 300K house hurts a lot less than losing 10% on a 700k house. Compare a 300K Charlotte home to a 700K NJ home and they are about similar.
Heck compare a 200K NC home to a 500K NJ home. The 200K home trumps what you can find in NJ today. Is there a 200K new 2,000 sq ft house in NJ? Again a 10% loss on 200K starter home doesn’t hurt like a 10% loss on a 350K starter home fixer upper that needs a lot of work and has astronomical taxes.
Vic – here is an article by the Greenpeace guy:
http://www.washingtonpost.com/wp-dyn/content/article/2006/04/14/AR2006041401209.html
Of course, I have no idea how mainstream they may be. My impression is that they are still somewhat maverick within the green community. I do find their points of view interesting though.
#162, Mitchell, per your logic, is NC a BUY while NJ is a HOLD?
Fire in New Brunswick guts 10 rowhomes:
http://www.nj.com/news/index.ssf/2008/04/firefighters_battle_new_brunsw.html
One of the commenters cracked me up: Devco Lightning, anyone?
From Bloomberg:
JPMorgan’s Dimon Says U.S. Real Estate Market `Getting Worse’
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon said he expects U.S. home prices to drop as much as 9 percent this year as even borrowers with the best credit are having difficulty keeping up their mortgage payments.
“Real estate is getting worse,” Dimon said in a conference call today with investors after the bank, the third largest in the U.S., reported first-quarter earnings. “Home prices we still expect to go down.”
bairen (5)-
Beginning, middle and end of that whole ridiculous discussion.
Coming soon, a bond market collapse and 10% mortgage interest rates.
I don’t know if it will be work safe, but I’ll flag it for later viewing at home. I love when it gets ugly and the low blows start flying.
http://www.msnbc.msn.com/id/24140922/wid/11915829?GT1=40006
Coming soon, a bond market collapse and 10% mortgage interest rates.
EAGERLY AWAITNG THE DAY.
potty (57)-
“How is the Spring 2008 rebound going so far?”
Pffft.
Mini-GTG tomorrow at 6 P.M. featuring myself, Kettle, and Sybarite at the Harvest Moon in New Brunswick. All are welcome.
vodka (64)-
Unlike young Pret, I remember the days when you couldn’t get a cab below Houston St after dark. Times Square was, well, Times Square, and you could find a three-card monty game on almost any block.
In a weird sort of way, that is the New York I will always fondly remember. Now, NYC strikes me as the cross between a theme park and a bad outdoor mall.
Vic (69)-
New parameter of bank performance defines “outperformance” as the ability to get through the day without a line forming outside bank branches’ doors.
“Dramatic decline in housing starts, rise in CPI, and lackluster results from JP Morgan,and the market is up?”
3b,
The leading sector of the S&P 500, today, is materials, following rising commodity prices.
Bank of Tokyo is Mitsubshi’s bank and with low low rates in Japan they would finance it. Or Mitsubishi itself could use it’s own cash or LCs. Also Mitsubishi Nuclear could get its subs to provide products no cash up front and build away. Mitsubishi has a contract with US Govt and has a swat team in Florida ready to go incase of a Nuclear accident in the USA. That swat team also does the decommissioning of plants and the periodic maint and removal of nuclear waste, they even haul the crap away. Way cool stuff.
#164 Most of the US is a Dont Buy Yet. Charlotte is border line. It might decrease but I think it will stay level for a while until surrounding areas stabilize or start to go up again. I would expect a 2-3% decrease this year but it went up about 1.4% somehow. I can only assume its that were still under priced compared to the areas people are moving away from.
Keep in mind when I say Charlotte I wouldn’t live in Charlotte but find a better surrounding area.
For any of the following do a 5 year graph and notice there really wasn’t a bubble or price explosion. But house prices can only go so high before they are out of sync with the area’s income. I feel for the majority were close but not over yet.
Fort Mill, SC – This would be my number #1 Pick for someone considering moving to Charlotte area. Even cheaper than NC with Good Schools.
Mooresville, NC – Excellent Schools.
Harrisburg, NC (Maybe?) School rezoning makes it questionable at times.
Denver, NC (In about 2 years this area will do well) Just has to wait out the nice highway they are putting in.
Train routes will make a difference in a few years too. Watch the CATS – Charlotte transit system.
I wouldn’t buy a home looking to make money today but would buy a home if I had to today to raise a family and provide a solid foundation. Like everyone they should buy within their means and not get carried away with the max amount they could borrow.
Housing is a long term commitment again no get rich in a few years deal.
I don’t feel you can go wrong with Charlotte area because most people will find a suitable no maintenance new home in the 230K-320K range around Charlotte. Even if the area get hit hard losing 10% of 320K is not bad. Getting hit 10% on a 500K home fixer upper is devastating.
Would like to throw in that someone losing their job on a 500K home sinks a lot faster than someone with a 230K home. I would hate to live where my job determines whether I have a house or live in my car.
If your in NJ I think waiting till 2009 and see what the market looks like then.
In in NC/SC might want to wait for the next interest rate drop. Try a 5% lower bid too. Buyers are limited because they cant sell where they are to get here. Northern renters with a bit of a down payment probably have the best advantage currently.
As long as the market participant believe that the worst is behind us and credit markets will recover int he next few quarters, the stock market will not go down on write-offs and bad earnings from Financials. Why would anyone forcefully sell something now if he/she believes that things will recover in a few months.
The problem with this kind of group think is that sooner or later, the thread will break and everybody will be rushing to sell and that’s when we might see another bottom in the stock market.
NYC was ruined by Guillani, I remember when I could have my beer out in the open at st. pattys day and new years eve, could drink and drive and not wear seatbelts, rents were cheap cause crime was high, 4am closing time was just a guideline, blackjack and craps were in the back of certain bars and girls did not have to advertise on the internet they could stand out on the street. Heck Javits at night had a few hundred girls out there. Pee Wee would have loved times square theaters. On a cold night bums were piled three deep at port and penn and hotels had three hour rates to sleep it off with whatever new friend you met. Plus at the bar you could play the numbers, bet the ponies, bet on the game and scope some drugs right off the bartender while admiring all the hot 16-19 year old B&T girls who came in for Saturday night. Plus aces and eights still had $10 all you could drink nights and midget bowling!!!
129:
And he was great in Beauty and the Beast and Hellboy, too!
Back in the day: After sundown, Washington Square Park was like something out of a Bob Guccione film.
OT.. I keep running into these types of ads lately on craigs list – http://newjersey.craigslist.org/apa/644716249.html – How do these work or are they just a scam?
John Says:
April 16th, 2008 at 3:23 pm
Plus aces and eights still had $10 all you could drink nights and midget bowling!!!
JJ: Which A&8’s? The one I remember was on Lafayette below Astor Place, and it was $5 all you could drink beer….
My memories were being offered smack at every stoop on 10th Street walking over to Veniero’s, and drinking rum on the second floor of Mickey D’s on 6th & 3rd. The optional stopping for red-lights on 10th Avenue due to CWD. Rodney King night on the UWS.
abw,
How does it work?
1) You call
2) They offer to sell you the list for $49, $99, or $149 dollars.
3) You accept
4) They give you a list of bogus properties
5) You cry, they laugh
Back in the day it also was not safe in nearly any neighborhood in Manhattan late on a Saturday night. Back in 1987 I was carjacked at gun point while getting the car so my friends did not have to walk around the block in the rain.
This was 51 st and 7 th ave right in the theater district. The car was later found in the 41st precinct in the South Bronx. The detective assigned to the case told me most likely the perps did not want to take the subway train home to the Bronx late at night because it wasn’t safe! LOL!
grim,
Thanks for the info. I figured it was something like that…
Nothin is ever that simple.
#155 hehe: Northern New Jersey’s housing market is reported to have stabilized, but at low levels.
I guess tons of inventory available could be considered stable, if we are to assume that the amount of new houses continuimg to come on the market is going to decline.
Howver it is only mid April, I would think we will still see invntory coming on the market at elast into June, before July 4th.
#152 Mike: I must admit, I am getting a little antsy myself;gary is rubbing off on me. (No insult to you gary).
#150 he he:Thanks.
GTG* Announcement
Several of us are getting together at Harvest Moon in New Brunswick on Thursday, 4/17 at 6PM for refreshments.
All are welcome.
*GTG bears no official affiliation with njrereport.
John Says:
April 16th, 2008 at 3:23 pm
Plus aces and eights still had $10 all you could drink nights and midget bowling!!!
JJ: Which A&8’s? The one I remember was on Lafayette below Astor Place, and it was $5 all you could drink beer….
———-
Ah, fond memories…yes, Aces N Eights on Lafayette – it was $5 all you could drink beer…big NYU crowd. They moved to Bleeker and became Rock Ridge Saloon, moved again to Varick and became the Blue Moose Saloon with total B&T crowd.
Yea it musta been five bucks all you can drink, I also remember Ryan McFaddans had a 8pm to 10pm nickle beer special. By the time you headed out to the clubs at 11pm you had 10-15 under your belt already for 75 cents for 15 beers was mighty nice.
Worst night in NYC I went to this nasty place called wileys that only served bud bottles and whiskey. Had a pos Fiat Strada that I parked everywhere cuase it was junk and the hatch back lock was broken, come out at 5am and my two doors are wide open and my passenger bucket seat is back. Turns out the working girls were using it for extra cash and the smell of “da funk” was over powering. Three guys in a Fiat at 5am in the winter two in the back seat with all the windows rolled down in January was a site to see. Wileys was legendery nasty the girls took tips over five bucks in the pie hole.
I forget who posted earlier about all of NJ being classified as “declining market” by lenders. At the time, I thought only certain counties had been put on this list.
However, through the course of the day today, the lenders in my office are in a panic. Why? All the lenders are putting the whole state on “declining market” status.
What does this mean? A house appraised at 300K now has a value of 285K in the eyes of a lender. 5% whacked off everything, form the get.
BTW, several more lenders today sending in price sheets that indicate at least 75 bps premiums on mortgage amounts over 417K.
So, none of the Fannie/Freddie/FHA “fixes” will move the meter one inch here in NJ. However, it is now much harder to get a loan.
grim I know it was OT but 161 is in moderation.
Was responding to John’s post 138: “100% of Japan’s electricity is nuclear”.
That’s simply false – it’s currently less than 30%
And it’s not only Mistubishi that is heavily invested in US nukes: Toshiba has spent a little bit lately to (over $5B) gearing up for the green-lighting of the next new nuclear stations
#142 Al: Understand. It appears there are some buiyers out there now who believe they are getting bargains, and houses where I am following are going UC, whether they close or not is another story.
It was extremely quiet in my area until the end of March, begining of April, and then all of a sudden 7 or 8 hosues seemed to go UC quickly; several had been on the market for 6+ months.
With the gracious help of grim and richnj, I will be very curious to see how much off final list price these houses actually sell for.
To be honest I expceted some capitulation for this Spring. Ia m not sure if I am sseing that or not yet.
Tricia Walsh Smith
http://youtube.com/watch?v=hx_WKxqQF2o
Amazing.
gary is the one who has been right, he’s like charlie brown but in the matrix. stupid spoon.
“All the lenders are putting the whole state on “declining market” status.”
The indicator is slowly shifting from concern to fear.
Let the rates rise: My quote of the day
I will take 12% interest on 150K mortgage over 6% interest on 300K mortgage any day…
135 007
I write contracts, but not for RE. For that, I’d hire a real estate agent and a real estate lawyer. I’m not much into DIY when it comes to the law if it’s not my area of expertise – seen too many things go wrong that way.
clotpoll [193],
Reading your post brought a joyful tear to my eye. Sort of like the Grinch when his heart grew bigger. (sniff…. )
#198 BC Bob
The indicator is slowly shifting from concern to fear.
& don’t forget, credit scores must be 580 min. on June 1st. Stimulus will help that.
139 al
“sellers will get jittery and not even consider your offer. ”
Too bad for them.
#199 Al: I will take 12% interest on 150K mortgage over 6% interest on 300K mortgage any day…
Agreed that has always been my mantra. I am more concerned with the underlying value of the asset rather than the financing mechanism.
3b (204)-
During the average span of homeownership, most buyers are presented with multiple advantageous opportunities to refinance.
The only thing you can’t refinance is negative equity. Asset value is all that matters.
I like the way GE’s profits drop 6%, and their stock gets pummeled and drops about 13%. Meanwhile, a few days later, J.P. Morgan Chase’s profits drop 50%, and their stock shoots up more than 6%. How irrational is this market to be up 250 points today?
I will take 12% interest on 150K mortgage over 6% interest on 300K mortgage any day…
Amen to that. And I love reading the realtor bullsh*t claiming that, “interest rates are at record lows and there’s so many homes to choose from.” They forgot to add the third statement that says, “and prices are so ridiculously high that you’ll need those electric paddles to jump start your heart after we show you the price.”
“How irrational is this market to be up 250 points today?”
Make,
XAU, up almost 6%.
173 clot
“In a weird sort of way, that is the New York I will always fondly remember. Now, NYC strikes me as the cross between a theme park and a bad outdoor mall.”
Yep.
178 Mitchell
You write long posts.
The Asbury Park Press from New Jersey. “Monmouth and Ocean counties led the nation last year in the percentage of borrowers extracting cash from their houses, usually through refinancing or home equity loans.”
“A staggering seven out of 10 high-risk borrowers in both counties — those with low credit scores — refinanced loans to obtain extra cash, Federal Reserve data for the end of 2007 showed. Such mortgage debt will continue to weaken the housing market at the Shore and around New Jersey this year, experts and consumer advocates say.”
“‘It’s no secret that we live in a credit-dependent society,’ said Brett Lopes, VP of Intercounty Mortgage in Hazlet. ‘In the same way that people don’t handle credit cards correctly, they perceived their house was worth more and more and they used it like a credit card.’”
# 206 clot: During the average span of homeownership, most buyers are presented with multiple advantageous opportunities to refinance.
Not to mention hey have the opportunity every month to throw a few extra bucks at the principal if they want, save interest, shorten the life of the loan.
189 3b
“gary is rubbing off on me.”
Get a room.
Please take a look at this video of Peter Schiff nailing this whole thing on Cavuto last Oct. 5th.
I loveit. The guy is a genious. I just need him to ne right on Gold as he predicts $5,000 per ounce.
#210 njpatient; Yes indeed. I kind of like that that version better, then prets wealth of talent idea that, that is all NYC is about.
bear in mind at last Oct the Dow was 14K.
194 clot
“However, through the course of the day today, the lenders in my office are in a panic. Why? All the lenders are putting the whole state on “declining market” status.”
Surely not the parts of the state that are near Manhattan (you know, Hoboken, Weehawken and parts of JC)?!?
Sorry here’s the link.
http://www.europac.net/Schiff-FOX-10-5-07_lg.asp
3214 Njpatient: Get a room.
Can’t, sellers still will not lower their asking prices. I never over pay for any thing; never.
Keep in mind there is still 2 more months of subprime resets to occur.
Those with resets in almost all instances took the loans because they couldn’t afford the home to begin with so there is still a lot more foreclosures to flood the market before spring/summer even into fall and winter of 2008 as it takes a while to get them out of the home.
215 make
I would like to look. Link please!?!
ah
link
refreshing…
Check out this on June 29th 2006. He’ss right on the money.
Bc,
Why didn’t I listen to you back in 2006??
http://www.europac.net/Schiff-CNBC-6-29-06_lg.asp
Mitchell [221],
3 yards and a cloud of dust.
Vince Lombardi.
njpatient,
LOL!!
Lower Prices >> More Loan Losses >> Tighter Lending Standards >> Less Sales >> Lower Prices
This is the vicious cycle. It worked the reverse on the way up.
Higher Prices >> More Loan Gains >> Looser Lending Standards >> More Sales >> Higher Prices
#227 Hard,
Seems like many sellers in certain unnamed towns in certain unnamed counties are hoping to skip the last item in that first list… and jump right over to the “higher prices” part.
“If we believe it enough, and dig in, it can be so!”
Feh.
make money Says:
April 16th, 2008 at 5:00 pm
Check out this on June 29th 2006. He’ss right on the money. Bc, Why didn’t I listen to you back in 2006?? http://www.europac.net/Schiff-CNBC-6-29-06_lg.asp
NO…he was 12 months too early….you would have missed a massive runup in stocks for the 15 months that followed his call.
make money Says:
April 16th, 2008 at 4:53 pm
Please take a look at this video of Peter Schiff nailing this whole thing on Cavuto last Oct. 5th.
I loveit. The guy is a genious. I just need him to ne right on Gold as he predicts $5,000 per ounce.
DOW 40,000?
make money Says:
April 16th, 2008 at 4:34 pm
I like the way GE’s profits drop 6%, and their stock gets pummeled and drops about 13%. Meanwhile, a few days later, J.P. Morgan Chase’s profits drop 50%, and their stock shoots up more than 6%. How irrational is this market to be up 250 points today?
albani: GE is a cred thing…also the Street isn’t convinced the albatross hangs together to create synergies.
#225 BC Bob
Taking my ball and going home. :)
This one is my favorite. He’s got all reporters on CNBC dunbfounded as he just keeps making sense. This one is back on April 2005.
Yet they stop inviting him to these shows on CNBC anyone. I guess it sucks being right and making everyone else look like a fool.
http://www.europac.net/video_cnbc_050425.asp
The ending is especially funny.
chi [229],
Not even close. Gold blew the doors off equities.
THIS IS COMEDY……..
John Says:
April 16th, 2008 at 4:09 pm
Worst night in NYC I went to this nasty place called wileys that only served bud bottles and whiskey. Had a pos Fiat Strada that I parked everywhere cuase it was junk and the hatch back lock was broken, come out at 5am and my two doors are wide open and my passenger bucket seat is back. Turns out the working girls were using it for extra cash and the smell of “da funk” was over powering. Three guys in a Fiat at 5am in the winter two in the back seat with all the windows rolled down in January was a site to see.
#233 make money – Thats the best one.
Has hell frozen over?
MLS# 2508804 – 30 Cypress, Millburn NJ
Purchased: 8/26/2005
Purchase Price: $559,000
Current asking: $529,900
MLS# 2508998 – 601 Upper Mountain, Montclair
Purchased: 6/21/2006
Purchase Price: $570,000
Current asking: $399,000 (short sale)
#237 Grim there was a frost warning last night all the way down here. Maybe it has.
Keep them coming Grim!
JMac & Sybarite
A little notice on gtg’s please. :(
new thread
Now the situation of the housing market in NJ has all its fundamentals clearly in place and easy to identify. Even a HS graduate can figure out this simple algebra:
Three elements: 1) buyer income; 2) financing and terms; 3) price.
– Buyer income: are people making more money? Yeah, right. People are lucky to be keeping their jobs. And, no matter what you make, be sure to give thanks to Bergabe for allowing hyperinflation to debase whatever purchasing power your $$$ might have.
– Financing & terms: Hah. Unless you have a big DP and 720+ FICO, bend over and grin. No new guidelines, no great jumbo rates, no piggyback. And- BTW- if you’re buying in NJ, your lender now thinks you’re taking at least a 5% haircut the minute the ink dries on your closing docs. Of course, these lenders are going to insulate themselves now against your potential loss becoming their loss.
– Prices: Is 4x and 5x income a reasonable amount to pay, given the above circumstances?
No home, neighborhood, town or county is now immune. The picture is so clear that an 8th grader can grasp it (my daughter is in 9th grade & is sitting next to me right now, nodding her head).
Of course, that FSBO lady in Basking Ridge will be the exception. She’s got granite.
Too bad the biggest chunk of granite is between her ears.
jmacdaddio, 166
*takes bow*
That was me.
Bruiser –
I tip my hat to your funny wit.
Lost –
I didn’t think you’d want to come all the way to New Brunswick on a weeknight. Syb, Kettle and I all kinda work close to each other so we figured we’d get a beer. Or two. Or seven.
chicagofinance Says:
April 16th, 2008 at 5:15 pm
make money Says:
April 16th, 2008 at 5:00 pm
Check out this on June 29th 2006. He’ss right on the money. Bc, Why didn’t I listen to you back in 2006?? http://www.europac.net/Schiff-CNBC-6-29-06_lg.asp
NO…he was 12 months too early….you would have missed a massive runup in stocks for the 15 months that followed his call.
Albani,
Are you kidding me? Check the Gold and Commodities and they blew away your “big run up” to Dow 14K.
I’ve been watching and reading this guy all the way back to the ’90s and the only thing that he didn’t understand was that Bush was not gonna let a recession stop him from being re-elected like his Dad.
Now the Pain is gonna be twice as bad.
http://articles.moneycentral.msn.com/Banking/HomeFinancing/AverageJoeStillCantAffordAHome.aspx