From the Daily Record:
Developer, agent ordered to pay $7 million for Florham Park, NJ, house sliding down hill
Finding that a developer and his construction agent violated state consumer fraud laws, a judge Friday ordered the pair to pay $7 million to a scientist who contracted in 2006 to buy a luxury home in Florham Park that is slowly sliding downhill and can’t be occupied.
Superior Court Judge W. Hunt Dumont in Morristown found that Joseph Natale, a principal in JDN Properties of Florham Park LLC, and his construction agent, Randy DeLuca, founder of Deltrus LLC, engaged in “unconscionable commercial practices” to the detriment of former scientist Dr. Humayun Akhtar and his wife, Yosria.
The judge’s award is made up of the $1.6 million cost of the 4,400-square-foot home on Beacon Hill Drive in Florham Park; $519,560 in tax, insurance, utility and other costs the Akhtars have incurred on the property they have never occupied; and $740,906 in legal fees.
The total award comes to $7,094,111 because the judge found that since fraud occurred, under the state’s Consumer Fraud Act, he would impose triple damages, exclusive of the legal fees.
The judge found that architectural specifications were not followed when the home was built. Based upon testimony he heard during a proceeding known as a “proof hearing,” the judge learned that soil conditions were not suitable to support the weight of the home and concrete footings were placed just 18 inches in the ground instead of the required 3 feet.
Numerous cracks have appeared and at least part of the house is in long-term danger of collapsing, the judge noted.
While the home was still in the process of being finished, the Akhtars first learned it was deteriorating when a plumber visited in 2006, noticed cracks, and concluded “the house is sliding down the hill,” the judge said.
From Salon:
Alan Greenspan’s housing bubble coffee break
From Standard & Poors:
S&P/Case-Shiller Home Price Indices – 2010, A Year In Review
Mr. Natale’s brother is not such a good guy either…I believe he went to prison a number of years back….
http://www.nj.com/business/index.ssf/2008/09/paralegal_pleads_guilty_in_nj.html
Monterey Towers in Watchung is Natale’s project…..finally finished last year, after five years of building 11 units…none sold……he is in very bad shape…….he also owns First State Bank in Cranford…..which is near cease and desist
http://banktracker.investigativereportingworkshop.org/banks/new-jersey/cranford/first-state-bank/
thundaar (3)-
Know the Natales well. Bigger scum does not exist.
They should all rot in jail & be sterilized so that they can’t reproduce.
Listing prices in the mid 600s for 4bd/2.5 bth splits in the so-called “want” towns in today’s paper – the same look as a few years ago. I don’t see much of a difference. Add the 30% increase in property taxes over the same time period and I’d say there are still plenty of suckers to be taken. Monthly property taxes are just about on par with the monthly mortgage payment for these homes. What type of urgency would cause people to create this financial suicide? Unless you’re prepared to put 50% down or better, you’re a dead man walking.
Gary,
The continuing property tax hikes – yet another nail in the RE coffin.
RE is dead for 20-40 years.
Gary , just witnessed it on the sale of my past rental. Wanted to shake the people and say”are you crazy, do the math”. I know they had all the correct numbers , I gave them to them. Heating , taxes, right down to landscaping and pool cost, no color added by me in my mind they spoke for themselves. Visited to give the propane figure ,as I bought a load up front during summer, got payed still in my name,1800 dollars worth in 4.5 weeks. By the way no furniture to speak of except what my friend who owned the place & I left, place looked empty. If you are buying a half mil home with over 14k taxes & do not have money for furniture you got no business living there. By the way about 3% down, this will end well. Nice people hope they get lucky.
Nation,
My property taxes have increased 78% over the last seven years. Do the mor0ns buying these homes realize the ridiculous, absurd mortgage payment they agreed to is only 35% of their payment?
Mikeinwaiting,
These people have no idea what they’re walking into. I don’t care how much money they’re making, it’s a death sentence. The maintenance on top of utilities on top of PITI is crushing. My advice to anyone crazy enough to bid on a house is to make an equally absurd low ball offer.
Whoa.
“If the Fed could so easily come up with 12.3 trillion dollars to save the banks, why can’t it find a few hundred billion under the mattress to save the states? Obviously it could, if Congress were inclined to put non-bank lending back into the Fed’s job description. Then why isn’t that being done?
The cynical view is that the states are purposely being kept on the edge of bankruptcy, because the banks that hold Congress hostage want the interest income and the control.
Whatever the reason, Congress is standing down while the nation is sinking. Congress must summon the courage to take needed action; and that action is not to impose “austerity” by cutting services, at a time when an already-squeezed populace most needs them. Rather, it is to create the jobs that will generate real productivity. To do this, Congress would not even have to go through the Federal Reserve. It could issue its own debt-free money and spend it on repairing and modernizing our decaying infrastructure, among other needed works. Congress’ task will become easier if the people stand with them in demanding action, but Congress is now so gridlocked that change may still be long in coming.
In the meantime, the states could take matters in their own hands and set up their own state-owned banks, on the model of the Bank of North Dakota. They could then have their own very-low-interest credit lines, just as the Wall Street banks do. Rather than spending or selling off valuable public assets, or hoarding them in massive rainy day funds made necessary by the lack of ready credit, states could LEVERAGE their assets into a very strong and abundant local credit system, following the accepted business practices of the Wall Street banks themselves.”
http://www.zerohedge.com/article/fed-has-spoken-no-bailout-main-street
mikey (8)-
Just another victim, kid.
http://www.youtube.com/watch?v=aSlXFoIAa88
Listings starting to trickle in on the hot sheet as super bowl approaches. Soon it will become a flood, pull up a chair get the popcorn and beer. I will go on record that there will be a bloodbath this spring.
Clot question, to my knowledge you can not get a mortgage with an underground oil tank. If you had one in the past, separate tank ins was the norm in my area. Now no company is willing to write new policies, no separate ins on a tank, no regular homeowners. If tank leaks regular home owners doesn’t cover, big money you walk away, bank is stuck so no mortgage.
Camden’s gonna get fun:
http://www.nytimes.com/aponline/2011/01/16/us/AP-US-Broken-Budgets-Camden-Layoffs.html?hp
Gonna?
Toast 14 “Local activists say the quality of life could suffer in a city that’s already among the nation’s poorest and most crime-ridden.” With that I should be sweetening up my coffee with Irish whiskey, they should have bulldozed the whole place years ago.
Mikey (13)-
There are still a couple of companies that will insure a UG oil tank in NJ, but they condition their underwriting so heavily that it’s easier just to pull the damn thing out.
I am not aware of any companies that currently underwrite tanks that will allow the policy to pass with title.
Bulldozed has such a negative connotation. Pave over with bike trails sounds so much more progressive.
#13 – Step right up people, get the house of your dreams and a tax ball and chain around your ankle that will grow by 5% in perpetuity. As your house value goes down, your property taxes go up. Hurry, act now, limited time (exp 4-30-30) offer.
shore [18]
To put the bike trails in place you still need to bulldoze the place first… BTW, I think this is the optimal solution not only for Camden but for the country – we need to permanently eliminate 10-20% of housing stock to have the market stabilized and supply to match demand.
1.grim says:
January 16, 2011 at 7:35 am
From Salon:
Alan Greenspan’s housing bubble coffee break
If there was any justice left in this country, Greenspan would be incarcerated for life for “Economic Treason”.
cobbler (20)-
Too bad that once necronomies degenerate into Japanese-style torpor, people quit breeding. Hard to generate demand when the entire population is declining in numbers, aging and the males are turning into girly-men.
Still thinking of revising my RE is dead call out to 50-100 years.
confused (21)-
Why spend the money to jail him? Seven riflemen: six live rounds, one blank round. Problem solved.
Swift and certain justice…the type that tells all the Bergabes and Eraserheads who come after that they better not try to pull the same hijinks.
http://www.latimes.com/news/nationworld/world/la-fg-tunisia-unrest-20110117,0,5379859.story
Justice, Clot style.
Cobbler debt shore
no bulldozer needed. A nice air burst at low altitude with a thermobaric device will completely level a substantial swath.
V-a-g-i-n-a!
Here is an interesting question….have you ever seen a bike trail bulldozed?
cobbler says:
January 16, 2011 at 1:29 pm
shore [18]
To put the bike trails in place you still need to bulldoze the place first… BTW, I think this is the optimal solution not only for Camden but for the country – we need to permanently eliminate 10-20% of housing stock to have the market stabilized and supply to match demand.
He became an echo chamber for stray ideas, amplifying, for example, certain grandiose tenets of a number of extremist right-wing groups — including the need for a new money system and the government’s mind-manipulation of the masses through language.
http://www.nytimes.com/2011/01/16/us/16loughner.html?hp=&pagewanted=all
Yikes-
Sounds like he belongs here.
chi [27]
To make bike trails desirable for the families, etc. one needs to set them up in a park-like setting. To create a park-like setting in a currently built-up area it first has to be cleared from the structures. While airburst of a thermobaric weapon as Mr Hyde suggest may be one approach, I support bulldozing as it (a) creates employment, (b) allows some resource recovery, and (c) will be required after the airburst, as well, to clear the rubble.
26, was the exclamation point really needed there?
Yikes the right does no do LSD and dream 15 hours a day, this nut job wAs as all his friends described Liberal.
14 3 Jets. John must be going orgasmic.
I’m beginning to dread jj’s Jets smack talk here tomorrow.
Then again, we have the ability to suggest a Roethlisberger/Mrs. Ryan “date”.
How to flee your country in style:
“Not shares of AAPL, not freeze dried MREs, not shotguns shells, not even €45 million European pieces of linen in a suitcase… Gold. And one wonders why all the physical silver and gold is slowly but surely disappearing from the distributors: someone should really check the cargo hold of Lloyd’s, Jamie’s and Vikram’s G-6 planes…and of course the extra cargo holds in the private helicopter squadron of that “other” Ben, elsewhere now known lovingly with the adjective of Blackhawk (f/k/a Helicopter).”
http://www.zerohedge.com/article/deposed-tunisian-president-ben-ali-said-have-fled-country-15-tons-gold
Eff the Jets. We have to deal with that blowhard Ryan non-stop now.
how about mine tonight? BOOYA
Debt Supernova says:
January 16, 2011 at 7:06 pm
I’m beginning to dread jj’s Jets smack talk here tomorrow.
JJ is obviously related to Midas.
Get ready for Steeler Nation. It will not look like week 15 and Harrison will take it up a notch.
I may let JJ manage my money and my sports betting.
http://www.scribd.com/full/46988426?access_key=key-10cwxgj1ujnphk0dgsfe
Here is the updated nominal vs inflation-adjusted chart for NY/NJ Case Shiller Index.
The green line uses Shadow Stats CPI-U data, which is way higher than headline.
It was A. West’s brilliant idea to use shadow stats data. I cant believe how much it contorts the chart.
For example, according to Shadow Stats inflation is 8% right now. Compound that over 20+ years and you obviously get a totally different perpective.
Not even Snake Pliskin would ride a bike trail in Camden……..
Neanderthal [41]
Shadowstats data is enlightening for many things, but it certainly overestimates CPI. Based on their numbers, average worker’s purchasing power halved or so in the last 20 years – this may be the case for houses and colleges, but not much else.
Since the Giants are out of it and I no longer know anyone on the remaining teams, I can get behind the Jets. Why not? They are from around here.
No WE CANT
http://www.screenhead.com/wp-content/uploads/2010/09/megamindposter.bmp
Veto
Nice Charts!
It also raises the debate you an i had before regarding when the “real” bottom was in the 90’s bubble. Nominal trends say 91, while adjusted trends say 97/98. The ShadowStats data is somewhat striking but not really surprising.
You can contemplate the implications of the shadowstat data over this
http://www.youtube.com/watch?v=Z_hrTH9-8Wo&feature=related
Oh, and to be picky, that index doesnt go back to 75 (They only go back to JAN 1987), you are building a composite index out of multiple data sources. You might want to footnote that somewhere other wise someone not familiar with your methods would think you are pulling 12 years of data out of thin air.
Veto/Neanderthal
What you chart also tells us, is that base dont he shadow stat data, housing has on average been a net losing proposition for the last 35 years. While some may have managed to time the peak/troughs perfectly most did not. On top of that the ever increasing carrying cost of housing just digs the hole deeper. While not a surprise to most on this blog, is certainly goes against commonly accepted RE dogma.
That is not to say that you should never buy a home, but it does say that it isn’t an investment unless you consider playing craps as investment. As clot and others on this blog have pointed out housing should be considered from a consumption point of view.
Veto
The Shadowstat adjusted data seems to show a floor around 170 on the index. The funny thing is that when that floor was hit in 83 and in 98 the median home price to median income ration was in the 2.5 – 3.0X range both times, and we are currently at that floor and still well above the those ratios……
I heard that jail is a bite in the @$$ but this adds a new twist:
http://www.bbc.co.uk/news/mobile/world-us-canada-12187409
Wonder if they are all related this this Natale from Holmdel who went to jail for pleading guilty to a $40M hedge fund fraud…
http://independent.gmnews.com/news/2000-03-17/Front_page/f09.html
Oh, by the way, he’s now a realtor “FSBO Johnny”. I’m sure he’s on the up and up now…
http://www.fsbojohnny.com/
Schro #48: I had figured I was a genius when we bought a solidly-built cape on a dead-end street in 1996 where nothing had been updated since 1975. We bought at the bottom of the market and for a while everything looked great. Fast-forward 14 years, we’ve put about $60K into the place — new electric, water heater (twice), furnace, gutters, windows, roof, siding, basement family room refinish…and we still have a 1970’s kitchen where I’ve been refacing the cabinets for 4 years, an original 1950’s bathroom, an add-on 1968 bathroom with an olive green tub, and 40-year-old carpeting. Now I want to only stay another eleven years till we can retire to NC…and it doesn’t pay to do any significant work on it anymore. The only real benefit we’ve had is that we can paint any color we want and haven’t had to ask permission to have cats.
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