Yet another housing price index – This one says good times are here again

From the Economist:

The rebound is now

On fundamentals, America’s housing market looks increasingly healthy. Inventory levels and vacancy rates are way down and rents are up. At the national level, the entirety of the price boom between 2000 and 2006 has been unwound and then some. Mortgage markets are still clogged, but investors are moving properties from owner-occupied to rental status with gusto. And yet, as the quote above indicates, prices are still dropping. What gives?

One major issue is the serious limitations of housing market data. Take the Case-Shiller index. Its monthly figures are a three-month moving average, which means that the January numbers are an average of prices reported in November, December, and January. And Case-Shiller gets its data when closed sales are officially reported, which means that the figures could include sales the contracts for which were signed as far back as September. It’s now closer to September of 2012 than to September of 2011!

There’s a glaring data hole, in other words, and Jed Kolko, chief economist at Trulia, is endeavouring to fix it. Today, he unveiled a new price and rent monitor built on listings at Mr Kolko writes that final asking prices are a good predictor of sales prices—but are available months before the closing sale price. By taking asking prices and rents and adjusting them for property characteristics, he reckons he can put together a useful indicator of home prices with a much shorter turnaround time. And what does the inaugural monitor say about housing-market conditions?

Nationally, asking prices on for-sale homes were 1.4% higher in March than one quarter ago. Prices increased month over month by 0.9% in March and 0.6% in February. What we found through the Monitor is that asking prices had been declining prior to February and reached a low in January 2012. Throughout 2011, asking prices rose slightly in several months of the year, but never more than 0.2% in a month. Asking prices in March were 0.7% below their level one year earlier.

One thing to keep in mind — because the Trulia Price Monitor is seasonally adjusted, these monthly and quarterly increases are on top of typical springtime price jumps. Without adjusting for seasonality, asking prices rose 2.4% quarter over quarter.

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81 Responses to Yet another housing price index – This one says good times are here again

  1. grim says:

    From the WSJ:

    Asking Prices May Presage Turnaround, Report Says.

    Once gun-shy home sellers may be feeling more confident as they set listing prices these days, which could translate into higher sales prices down the road, according to a report released Thursday.

    The asking prices for homes on the market climbed 1.4% nationally in the first quarter compared with the prior quarter, said Jed Kolko, chief economist for home-listings company Trulia.

    The report, which tracks asking prices for Trulia’s listings in 100 metro markets, showed the largest month-over-month uptick since the beginning of 2011. Asking prices rose 0.9% in March and 0.6% in February. The highest monthly increase in 2011 was an anemic 0.2%. Since the year-ago period, asking prices were down 0.7%. Typically, Mr. Kolko said, sales prices lag behind listing-price trends by two to three months.

    This is the first time Trulia has produced this report, which aims to use asking-price data over the past year to predict market trends. Only the most recent listing-price data for homes are included, and comparable property types and neighborhoods are used for a more apples-to-apples comparison. The report looks at a three-month moving average for listing prices.

    The figures are seasonally adjusted, and therefore take into account the rise in prices typically seen in the spring. On an unadjusted basis, asking prices rose 2.4% over the prior quarter. The report also looks at asking rents, which it says rose 5% in the first quarter compared with a year earlier.

  2. grim says:

    Link to the Trulia data:

    NY Metro Asking Prices down 3.3% YOY, Rents up 6.2% YOY
    Edison Area Asking Prices down 4.3% YOY, Rents up 10.5% YOY (wow)
    Newark Area AP down 5.2% YOY, Rents up 2.7% YOY

  3. grim says:

    From Smart Money:

    Timeshare Prices Plummet to $1

    Unable to sell his parents’ ocean-front timeshare for the past year, David Suder became so fed up he offered to give it away. They paid $8,000 for the Orange County, Calif. unit a decade ago, but since there are no willing buyers, and his 81-year-old mother, now a widow, can no longer afford the monthly maintenance fees, Suder says he doesn’t have a choice. The San Diego-based real estate investor is offering the unit for free in the hopes that someone will take it before his mother dies. “I don’t want to inherit it,” he says. “I want it to go away.”

    While real estate – and even vacation real estate – is starting to show signs of recovery, timeshares remain in freefall. During the first quarter, the number of for-sale-by-owner postings doubled compared to the same period a year ago on, a popular resale site. Another site,, says owner sales are up 20% during that period.

    Experts say even in better times, most sellers never saw a return on their investment. “Very few timeshares increase in value,” says Alisa Stephens, executive producer at As values sink and desperation grows, the number of owners giving their timeshares away for $1 – or less — has doubled in the past year, says Brian Rogers, of Timeshare Users Group, an owner advocacy group. “There’s never been a worst time to try to sell a timeshare,” he says.

  4. Comrade Nom Deplume says:

    It’s a beautiful moonlit night in Maui and I’m soaking in the last of the unexpected upgrade to oceanfront. The Grand Wailea won’t be so generous.

  5. grim says:

    4 – jerk

  6. The Original NJ ExPat says:

    Federal judge approves $25 billion mortgage pact:

    I love this quote from the article: “The government had said its intention was to remediate harms allegedly resulting from the alleged unlawful conduct.”

  7. grim says:


    “The government had alleged its intention was to remediate harms allegedly resulting from the alleged unlawful conduct.”

  8. Another day in hell.

  9. borat obama says:


  10. Mike says:

    Good Morning New Jersey

  11. Mikeinwaiting says:

    Grim 5 agreed, stuff it Nom.

  12. reinvestor101 says:

    I feel that damn guy’s pain on the damn timeshare. I have one and the damn maintenance fees are killing me—have gone up astronomically since I purchased the damn thing and I no longer even use it for vacationing. It’s a pain to use anyway because you have to exchange for a week up to a year in advance and I generally don’t plan vacations that way. I generally just like to plan a month or two in advance. That whole timeshare thing is a scam and I suspect that they’ve sold more “shares” than what physically exists—it’s a bit like fractional banking, not everyone is going to come in for their money all at once and similarly, not everyone is going to come in to use their timeshare all at once. The perfect ponzi scheme.

  13. grim says:

    Stuff it right in his Humuhumunukunukuapuaa

  14. grim says:

    I wonder what the ROI is on the “free” breakfast and tour passes?

  15. vb says:

    For rent macmansions skewing rent statistics?

  16. grim says:

    16 – Out here? Believe it or not, not really. Looking through the past few weeks of closed rentals, there aren’t that many. Just a quick un-scientific glance looks standard distribution, skewed towards the low end. Yes, you’ll see the occasional big-skew/long-tail $8-10,000 rental, but it’s more common that those are older/stately homes in the high end towns (Far Hills, Short Hills/Millburn, Summit, Basking Ridge, etc). Those have always been out there, mainly due to temporary senior exec level relos/assignments. I’ve personally done 3 rentals in the $7500-$10k range in the past 4 years, hard to believe, but 2 of them were screaming bargains (compared to buying, of course, for the most part due to mid-5 figure property taxes).

  17. grim says:

    Ugly ugly jobs number

  18. grim says:

    From MarketWatch:

    U.S. gains smaller-than-expected 120,000 jobs

    The U.S. economy added 120,000 jobs in March, marking the smallest increase in five months, the government reported Friday. The number of jobs created last month fell well below expectations and failed to break the 200,000 level for the first time since December. Economists surveyed by MarketWatch expected a 210,000 increase. The unemployment rate, meanwhile, fell to 8.2% from 8.3%, mainly because more people dropped out of the labor force. The average workweek fell 0.1 hour to 34.5, while average hourly earnings rose 0.2% to $23.39. Employment gains for January and February were little changed under Labor Department revisions. Employment in March was hurt in part by a 34,000 decline in retail jobs.

  19. gary says:

    Employment in March was hurt in part by a 34,000 decline in retail jobs.

    Part time holiday jobs at Target at $8.25 per hour just didn’t provide enough hope and change.

  20. gary says:

    The unemployment rate, meanwhile, fell to 8.2% from 8.3%, mainly because more people dropped out of the labor force.

    Can we end the experiment this November? Please?

  21. grim says:

    AG – did you lock?? might see a nice little dip here.

  22. grim says:

    Ohhh, forgot to mention, I refi’ed a few weeks back, 3.9% – 30y, down from my original 4.875%. Kandi at First Valley is always my first go-to. Knocked a nice chunk off my PITI from the rate, and my new appraisal came in just about high enough for me to knock off PMI (needed big $$ for the renovations), saving me a few hundred more. Payback on the closing costs is under a year.

  23. Fiddy Cents on the Dollar says:

    grim —

    Nice work on the re-fi. That’ll save you a few bucks every month.

    Did you get a look at the appraisal ?? What did they use for Comps ??

  24. grim says:

    Talked to the appraiser when he was here, he had comps already, unfortunately there weren’t many similar sales, so I got docked a bit because he comped low, against smaller splits (1700-1800 sqft), instead of similarly sized two story colonials (I’m a 2000 sq ft ranch), and hit a second time because there weren’t comps of similar quality upgrade (just wait till you guys see the kitchen pictures in Architectural Digest).

  25. Fiddy Cents on the Dollar says:

    The Kitchen is the most important room in the house, he should have made that a focal point. Oh well…..when you eventually sell, you’ll get the payback for the Kitchen, and you’ll have the use of a Gourmet Cucina over the years.

    Did he measure the house accurately ? 2000 sf is a nice size Ranch.

  26. livinginpa says:

    Re jobs number… anyone seen Soledad O’Brien’s show on CNN – Starting Point. That dope Ali Velshi is cheering how great these numbers are and that “we are on the right side of the trend.” Honestly, who the F*** believes these people? Unfortunately, I know many that like their news spoonfed to them and will walk around talking about how great it is that the unemployment number is down to 8.2%. Dear God, I’ll never find a house to buy in my very specific area b/c the realtor that has most listings locked up, and priced 25% too high, will be first to tout this news as the big turnaround. Uuugghh this is so infuriating.

  27. grim says:

    It is, very deceiving from the street, set far back on the lot so you don’t realize that it’s actually 65×30. It’s one of the big reasons I don’t think they had good traffic last year, everything just seemed small with the MLS pictures, dark interior (paneling, dark wall paper), the green shag didn’t help either.

    We blew out a couple of walls, added some windows/french doors to let more light in, like magic. Moved the laundry to the basement to free up kitchen space, extended the kitchen a foot and a half further into the family room.

    Best part is that I’ve got 1,200 square feet of wide open basement with ceilings just shy of 8 feet that I’m getting ready to finish (the other 600 and change is the garage).

    Had the plumber and electrician clear the ceilings of any pipes and wiring so that we can drywall right up at the joists, no drop ceilings, no bulkheads, max height. Central AC is in the walk-up attic, so no ducting to take up space in the basement, boiler is tucked in the corner.

  28. gary says:

    livinginpa [28],

    We’ve been told that we were in the worst depression known to man and the Choosen One has worked miracles to deliver us from despair. I’ve heard he can turn water into Kool Aid.

  29. Painhrtz - I ain't dead yet says:

    living to quote George Carlin

    think of the dumbest person you know, now realize that 50% of the American population is dumber than that

    those are the people who believe this sh*t

  30. grim says:

    Basement will end up having the laundry room/mud room, a new full bath, my office, and a big rec room with a 70s style nautical themed bar, Yar!

  31. Painhrtz - I ain't dead yet says:

    Grim since our houses are similar size what the plumber get you on moving all the plumbing into the joists? Also did they use pex or stay with copper? Was thinking of doing the same but heating pipes scare the bejeesus out of me.

  32. nwnj says:

    Does anyone know what technically constitutes a finished basement? Or is it one of those definitions that changes depending on convenience?

  33. Fiddy Cents on the Dollar says:

    Very Nice….it is amazing what dark paneling and green shag will do the the perceived size of the room !! Is your home really going to be featured in Architectural Digest ??

  34. Anon E. Moose says:

    Grim [3];

    “There’s never been a worst time to try to sell a timeshare,”

    Was there ever a “good” time to sell (or buy) a timeshare?

  35. Jason says:

    How are home prices expected to rise in an environment with:

    High gas and electicity prices, inflation, low employment, baby boomers downsizing, standard of living dropping, and taxes rising?

    Oh that’s right, the magical fairy dust…

  36. Nicholas says:

    There are several terms used to describe basements:

    Unfinished: You can walk down there but there is bare floor, usually concrete and just contains the facilities for the rest of the house.

    Roughed-in: Floor plan has been marked out and studs are in place. Drywall, electrical, insulation, HVAC are not in place.

    Drywall Ready: Electrical and HVAC are in place, insulation may or maynot be in place.

    Finished: Drywall is up, doors are on, plugs and switches are in with plates on.

    There is a broad spectrum of conditions for the basement and these are only rough guidelines but thats the terminology I have heard used.

  37. gary says:

    Jason [37],

    We’re exempt here in Northern NJ. We’re closer to Manhattan than ever before and the manufacturing of land is at historic lows. When you’re classified as prestigious, all that other nonsense that you mentioned doesn’t apply. Remember, success is measured by appearance and perception!

  38. grim (32)-

    I can send you an 8-track tape of the Love Boat theme song if you want.

  39. Does anyone who goes in your basement have to refer to you as Captain Stubing?

  40. 3b says:

    Some doofus on CNBC said the March numbers are just a mental anomaly??? What in God’s name does that mean?

  41. grim says:

    Does anyone know what technically constitutes a finished basement? Or is it one of those definitions that changes depending on convenience?

    I had someone tell me that if you didn’t finish the ceiling, that the basement couldn’t be technically considered “finished” from a tax standpoint. In fact, he recommended just painting the ceiling, pipes, ducting, wiring, etc all either black or off-white.

    I’ve never bothered to check with zoning or building to see if this is actually the case, but it sounds plausible.

  42. gary says:

    This jobs number really is atrocious. Hiring budgets for 2012 were finalized two months ago. After what this administration claims as the worst recession in 70 years, we should be on the road to substantial growth by now. This administration is running out of excuses.

  43. joyce says:

    From a tax standpoint, I believe that is spot on. I can confirm that at least 3 people in Livingston have their basements 100% finished (flooring, drywall, HVAC, plumbing, electric, wet bars, bathrooms, etc etc) but not ceiling, and they are not taxed as if their basements are finished.

  44. joyce says:

    You’re correct. For middle and lower income workers, we have had real declining wages/salaries for two decades. And now, nominal declining wages/salaries are showing. Fun times… fun if you like living through the Greatest Depression.

    In a weird way, wouldn’t it be somewhat comforting if we knew it would be the same or slightly longer than the Great Depression? We would be half-way ish through this hopefully. But Japan has now “lost” 2+ decades, and I read over on Mish’s blog that the majority of politicians are demanding more “easing” more liquidity as if the 97th try will fix it. Pure insanity.

    Default/restructure… get it over with already!!

  45. Nicholas says:

    Wow, you guys get assessed on finished basements? What a load of cr@p.

    Every place I have lived or worked never counts basements as liveable space regardless if they are furnished or not. The rationale is that a liveable space must have two exits in case one is blocked by fire and both exits must be large enough for a firemen to enter and exit in full gear. That means that tiny basement windows is not an exit.

    Perhaps NJ likes people to burn to death in small tight closed in spaces with no where to escape… Basements are not living spaces, they are shelters from tornados and other inclement weather regardless if they have ceilings and leather couches. Why would anyone ever finish a basement in NJ then? Sad mistake.

  46. Painhrtz - I ain't dead yet says:

    So drop ceiling not finished?

  47. chicagofinance says:

    gary says: April 6, 2012 at 9:23 am
    livinginpa [28],We’ve been told that we were in the worst depression known to man and the Choosen One has worked miracles to deliver us from despair. I’ve heard he can turn water into Kool Aid.

    I want to attend this thing, but I don’t know whether I can remain silent in the face of so much pandering…..

    A cocktail reception and engaging discussion featuring Sewell Chan ’94, Nick Confessore ’94, and Aaron Retica ’84 of the New York Times, Amy Davidson ’88 of the New Yorker, and Chris Hayes ’97 of MSNBC
    Monday April 30
    6:30 PM Cocktails
    7:30 PM Program

    Covington & Burling LLP
    The New York Times Building
    620 Eighth Avenue, 43rd Floor

  48. chicagofinance says:

    chicagofinance says:
    Your comment is awaiting moderation.

    April 6, 2012 at 12:18 pm
    gary says: April 6, 2012 at 9:23 am
    livinginpa [28],We’ve been told that we were in the worst depression known to man and the Choosen One has worked miracles to deliver us from despair. I’ve heard he can turn water into Kool Aid.

    I want to attend this thing, but I don’t know whether I can remain silent in the face of so much pandering…..

    A c-cktail reception and engaging discussion featuring Sewell Chan ’94, Nick Confessore ’94, and Aaron Retica ’84 of the New York Times, Amy Davidson ’88 of the New Yorker, and Chris Hayes ’97 of MSNBC
    Monday April 30
    6:30 PM Cocktails
    7:30 PM Program

    Covington & Burling LLP
    The New York Times Building
    620 Eighth Avenue, 43rd Floor

  49. chicagofinance says:

    chicagofinance says:
    Your comment is awaiting moderation.

    April 6, 2012 at 12:18 pm
    gary says: April 6, 2012 at 9:23 am
    livinginpa [28],We’ve been told that we were in the worst depression known to man and the Choosen One has worked miracles to deliver us from despair. I’ve heard he can turn water into Kool Aid.

    I want to attend this thing, but I don’t know whether I can remain silent in the face of so much pandering…..

    A c-cktail reception and engaging discussion featuring Sewell Chan ’94, Nick Confessore ’94, and Aaron Retica ’84 of the New York Times, Amy Davidson ’88 of the New Yorker, and Chris Hayes ’97 of MSNBC
    Monday April 30
    6:30 PM C-cktails
    7:30 PM Program

    Covington & Burling LLP
    The New York Times Building
    620 Eighth Avenue, 43rd Floor

  50. joyce says:

    I think a drop-ceiling would be considered finished, but I’m definitely not an expert.

    Quite simple… It’s much cheaper, even with the taxes, to finish a basement for more useable space than an addition (not counting taxes on that) or buying a bigger house.
    I believe the code for finishing a basement means it must have an egress window to come in/out of for emergencies.
    I’m against property taxes for numerous reasons; that being said, if you’re going to tax people on their properties and someone more living space(s), what does it matter what floor it’s on? It should be included.

  51. nwnj says:

    Re: finshed basements

    Thanks for the info. It seems to be a gray area.

    Likewise I’m wondering if it’s possible to “unfinish”(give me 15 minutes and a pry bar) a basement for tax purposes. If we intend to use it for nothing other than storage can we tear down the 60’s paneling and the drop ceiling, and take out the linoleum and get it reassessed? Probably not but it’s a disgrace to call this basement liveable space in it’s condition.

  52. zieba says:

    All this basement talk:

    I know someone who is… ahem… renting his basement to help offset a huge tax bill. When he finished the basement he made sure that the space was convertible at a moments notice, including details like one tile deep recessed shower knobs/fixtures. Recently, he was surprised by an inspection which he somehow convinced to come back the following day. He booted the tenant for a day, the details that follow are sketchy but he invited a few buddies over and got to work. The recessed fixtures were stuffed with socks/newspaper so they’d pass the tap test, re-grouted and distressed; kitchen was further reduced to kitchenette. Out with furniture to the shed out back, tables, recreational stuff (treadmill), kids toys and even brought in his in-laws. Next day, he opened the door for the inspector with a warm welcoming smile. That evening it was all back to normal. The tenant, who I’m told enjoys a drink or twenty, was provided with a Costco sized bottle of whiskey for his troubles and all was well.

    The sh*t people have to go through when they bite off more than they can chew.

  53. Comrade Nom Deplume says:

    [5] grim,

    Hey, I’m entitled to take a vacation every six years or so. And I do have the kids with me so its not like getting out of Jersey entirely.

    Oh, and I did see a humuhumu fish while diving the reef just offshore. Funny you should mention that.

  54. xolepa says:

    Considering you have 8 foot ceiling heights in the basement, my suggestion is not to have them sheetrocked, but to stick with the drop ceiling. I’m always tinkering in my finished basement, even with my 9 foot heights I would be screwed with my current project: Installing a sauna. How would I be able to drop a dedicated electrical wire from the main box to the sauna without destroying the structure? With panels, you just lift and do your work. High end panels look better, anyway. Other considerations: water drips from upstairs destroys gypsum, panels just get replaced. Putting in a home theater? wet bar with ceiling illumination, blah, blah, blah. I hope you get my point.

  55. Happy Renter says:

    Thinking about renting a house for a week or two somewhere down the shore this summer. It will be the first time I’ve done that since I was a kid, but we need to stay local this summer (baby on the way). If anyone has any recommendations on websites to use for rentals in South Jersey, I’d appreciate any tips — thanks!

  56. young buck says:

    Should you buy a foreclosure?

    Foreclosed properties can be a great deal for homebuyers, whether they’re planning to live in the house or rent it out. But they should know the potential pitfalls.

    Michael Barton was just 19 when he bought his first foreclosure four years ago for $37,000. The Lincoln, Neb., resident said he realized he could pay less on a mortgage than he was spending to rent a six-bedroom house with his brother and three other people.

    “I was paying $350 a month in rent and knew there were houses out there that would have a mortgage lower than that,” Barton said. “My original mortgage on my first house was $315 a month, and I had my brother living with me paying $350 a month, (so I was) living for free.”

    Since then, Barton has purchased three more foreclosed properties to fix up and rent out.

    By contrast, financial planner Diahann Lassus wasn’t in the market for an investment property when she noticed a foreclosure for sale around the corner from her Bonita Springs, Fla., home.

    After extensive research and number crunching, Lassus offered the bank 20% less than its asking price — a discount that reflected the considerable costs necessary to fix up a house that had been empty for two years. Her offer was accepted, so she wound up paying $95,000 cash for a three-bedroom house once valued at $350,000.

    The renovations cost more than she had expected — about $45,000 — and the return on her investment has been less than what she’s making on her stock market investments. But she has “great renters” who are covering her costs, and she expects the home to appreciate over the 10 years or so she plans to own it.

    Buying a foreclosure can be a great way to get a home for less, whether you’re planning to live in the property or rent it out. The supply of foreclosures certainly isn’t going to dry up soon, which means plenty of opportunities for home seekers and investors.

    Plenty of pitfalls await the unprepared buyer, however.

    “A foreclosure is not for everyone,” said John Anderson, a longtime agent with Twin Oaks Realty in Golden Valley, Minn., who says about half of his business is short sales and foreclosures. “A lot of buyers are struggling just to get enough money” for a down payment and “don’t have $4,000 to replace the carpet and $1,000 to repaint and $2,000 for new appliances.”

    Even for those who have some spare cash, it might not be enough to buy troubled properties that are too run-down to qualify for Federal Housing Administration or even conventional mortgages. Peeling lead paint can be enough to thwart an FHA loan, while more serious problems, like a roof that needs to be replaced, can stymie a conventional loan. In such cases, only buyers who can pay cash are considered.

    “The buyer has to qualify for financing, but the property has to qualify, too,” Anderson said. “The seller is not going to let you in to fix the property (before the deal closes), and the new bank won’t let you close until the work is done.”

    Some properties simply need too much work to make much financial sense. A foreclosure might be $15,000 less than a comparable property, for example, but may need $30,000 in repairs and improvements to make it habitable. In such a case, the more expensive property “is a better investment, because the work is already done for you,” Anderson said.

    “Just because the price is low doesn’t mean it’s a good deal,” he said.

    Here are some other things to keep in mind when you consider buying a foreclosure:

    Planning to flip? You might want to rethink that. People can, and do, buy foreclosed houses cheap so they can fix them up for quick resale. In falling markets, though, it can be hard for buyers, particularly amateurs, to do this successfully. If you don’t get a steep enough discount or spend too much on repairs or don’t find a buyer quickly, what looked like a great deal can become a cash drain. Many investors now are focusing on properties they can rent out for several years, so they can benefit from price appreciation when it eventually returns. Lassus recommends that foreclosure buyers be ready to hang on to a property for seven to 10 years.

    Don’t expect to automatically get a screaming deal. Some banks slash a property’s price for a quick sale, which means you’ll get the house for less than comparable homes in the area. Other banks don’t offer much, if any, discount, and intense investor interest in a property can lead to a bidding war that drives up the price.

    Pay for a thorough inspection before you buy. Foreclosures are sold “as is,” which means the bank won’t make repairs or improvements. Even if the house’s previous occupant didn’t trash the place in a fury, the home may have hidden defects that could cost tens of thousands of dollars to repair. A bad foundation, extensive water damage or bad siding or drywall could turn a seemingly good deal into a nightmare.

    “Get a registered property inspector to do a full inspection,” including a termite inspection, Barton advised, “and be willing to take a loss of $300 to $500 (the typical inspection cost) if the inspection turns up something major.”

    Anderson agrees. He also gets a promise from the seller to get any utilities turned on in time for the inspection, since in many foreclosures they have been shut off.

    “It’s pretty tough to do an inspection if the utilities aren’t on,” Anderson said. “You want to make sure everything is functioning so you can get a full inspection.”

    Get bids for repairs and improvements before you make an offer. Even if you’ll be doing most of the fix-ups yourself, you may still need pros for certain jobs. Having ballpark figures for repairs will help you know when you’re getting a good deal, or when you might be overpaying. You’ll also want to budget for surprises. Lassus had to scour the country to find the discontinued tile the previous homeowner had used in a half-finished job.

    Research the homeowners association. Lassus knew the homeowners association was financially sound, since she already owned a property there. She would have been far more wary if there were a lot of other foreclosures, houses for sale, empty houses and strapped homeowners. A dwindling number of dues-paying residents means the association may have to jack up the fees it charges the remaining homeowners to cover its costs.

    “Some associations don’t allow ‘for sale’ signs,” so it can be hard to know on casual inspection how many homeowners are in trouble, Lassus said. Real-estate sites such as Zillow can help, as can talks with local real-estate agents.

    Know the rental market. If you plan to become a landlord, you want to make sure the rent you can charge covers all of your expenses, including property taxes, insurance, repairs, maintenance, homeowners association fees and assessments, and mortgage payments. Zillow offers rent estimates for many properties, but check with local real-estate agents to make sure those are accurate.

    Also, a rental market may be hot right now, but it could cool off, leading to higher vacancies and lower rents, as many renters become homebuyers, Lassus warned.

    Barton said he has benefited from the fact that Lincoln is home to several colleges. A steady supply of renters means “we get extremely good rental rates,” he said.

    Be patient. Lassus’ deal was done within weeks because she paid cash and because the lender was on the ball. Other buyers of foreclosures warn that the buying process can take months and be chaotic.

    “I would say my absolute worst experience thus far is going through the closing process of foreclosed houses,” Barton said. “If you are dealing with HUD or Fannie Mae, they seem unorganized, probably due to the fact that they have thousands of these they are processing.”

    Barton says he’s learned it’s essential to work directly with the seller’s title insurance company if he wants the deal to close on time.

    Have a fat emergency fund. Lassus recommends every investor have an emergency fund to cover at least six months’ worth of property expenses — and preferably 12 months’ worth. Unexpected repairs and vacancies can play havoc with cash flow, so you want a fat cushion.

    After all, the last thing you want is to lose the property and become yet another casualty in the foreclosure epidemic.

  57. John says:

    “Jobs disappointing? Yes, but not a game-changer”

    We’re on the case – futures will be green by Monday morning

    Economic policy has been reduced to cheerleading – housing included

  58. grim says:

    I don’t believe you need additional egress in a finished basement unless it includes a bedroom or becomes a “dwelling unit” (apartment, etc). If you have two means of entry/exit, you are already covered, this includes bilco doors, etc). In new construction, absolutely required, but remodel, which falls into rehab subcode, there are exceptions. Check with your town, much of this is subjective and open to interpretation. Also, don’t put it past your local official to tell you that you need it, simply because it’s a good idea to have, but not because it’s required (I wouldn’t want to be stuck in a burning basement).

    For example, I had the building official tell me that if I was to replace my existing double hungs with new construction double hung windows (not replacement windows), I’d be required to increase the size of the windows to meet new code about egress, which would involve significant reconstruction, new headers, etc. When we had our last rough in, the inspector told me that the official I spoke to was full of shit. He also told me the electrical inspector was full of shit for making us add additional outlets to meet code in rooms we didn’t gut, but added recessed lighting in (I would have done it anyway, so no big deal).

  59. grim says:

    Considering you have 8 foot ceiling heights in the basement, my suggestion is not to have them sheetrocked, but to stick with the drop ceiling.

    If I’m going to lose ceiling height, I might opt to lose it to something like DriCore subfloor. Carpet or laminate over concrete is just asking for problems, and I’m currently thinking that I’m just going to end up tiling the entire basement floor (convenient and practical, but not very cozy).

  60. xolepa says:

    First, seal the floor as well as possible. Epoxy is best. Enamel is good, but several coats needed. The object here is to prevent moisture seepage from below. If the floor is level, use a floating floor. It’s that fake wood stuff you snap together. You lay it over a foam type underlayment. The floor expands and contracts accordingly and does not buckle. The stuff wears quite well, too. Don’t use real wood down there. That’s asking for problems. You can always throw area rugs over the floating floor. My basement has a combination of floating floor and carpet. The carpet works well because the basement is dry and being so deep, the floor temperature is near constant. I also rolled out 6 mil plastic over the entire floor after paint and before finishing.

  61. plume (54)-

    Why go all the way to Hawaii? JJ says you can get one of those over by the Javits for $10.

    “Oh, and I did see a humuhumu fish while diving the reef just offshore.”

  62. Mikeinwaiting says:

    grim 60, xolepa is correct use a floater in basement look at Alloc Flooring. I have done thousands & thousands of sq. ft. of it they have different grades the high end stuff is the best hands down, mid grade will most likely be more than enough for your purposes.
    If you have any questions reach out to me I ‘ll be happy to help. Also you can install it yourself if inclined, you are pretty handy.
    PS it will eat up your blades, stuff tough as nails. Get an extra one or two before job.

  63. Mikeinwaiting says:

    Meat 62 I thought that was back in the 80s , didn’t they clean that area up.

  64. The Original NJ ExPat says:

    Hope you’re enjoying Maui. Wife and I are familiar with the three other main islands but not Maui. Recommend?

  65. caljn says:

    Re: Gary #22

    We ended the experiment Nov. 2008.
    It takes more than 3 years to correct a situation 30 years in the making; the prior 8 with 2 unbudgeted wars and subsequent lunatic tax policy the icing on the cake.
    But we’re making progress…be hopeful.

  66. AG says:



    I think I like you. Your optimisim, however, will be your downfall. History is cyclical not linear. The great reset is coming folks. It will be a sight to behold. Anyone buying homes right now is a moron. Anyone in a home right now needs to cut losses. I thank God for morons.

  67. gary says:

    Caljn [66],

    But we’re making progress…be hopeful.

    …arrogant, presumptuous, anemic, languid, ruderless and leaderless on top of $5,000,000,000,000 of accrued, crushing debt. If that’s your idea of progress, buckle your seatbelt, we’ll be arriving soon.

  68. gary says:

    He’s a mope… nary a friend to be found on the hill nor a direction to turn. Void of leadership… lacking moxie with a paper thin persona doomed to a one term calamity better known as a failed presidency.

  69. Comrade Nom Deplume says:

    Oooh, I was mistaken. Upgraded to oceanview at the Grand Wailea.

    So this is how the one percent vacations. I felt underdressed when checking in but then I remembered that its the wannabes that dress up in polos and Tommy Bahama. To everyone who know that rule, I probably looked like Robert Kraft’s kid.

    Returning to jersey on Monday. Sigh.

  70. Comrade Nom Deplume says:

    Snorkeled at Black Rock today. Okay snorkeling location but really amatuer hour there. Overrun with bennies who think its cool to play with the turtles. Two of them, including a really large male who was clearly comfortable with swimmers, swam right in front of my older daughter who screamed and ran back onto the beach.

    Later, I was feeding that turtle. There were better spots right off our beach but I did not want to go 200 yards offshore by myself. My dive instructor suggested black rock cuz there is always a crowd there.

  71. Fabius Maximus says:

    #69 gary

    And a lock-in for re-election, because there is no opposition. Although someone told me that Mitt may finish the primaries just a little right of center. That shouldn’t be a problem as the the party and the country will rally around him and elect him regardless.

    #66 caljn
    That’s it in a nutshell. GWB ran the country off a cliff and people complain that O just didn’t bounce it straight back up again.

  72. Comrade Nom Deplume says:

    [65] expat,

    So far, I’ve not seen or done anything to commend Maui over Hawaii or Kauai. They’re all different in some respects. One thing might be access to Molokini, which looks cool but not for us on this trip.

    Depends on what you want, I guess. I will say that the big island resort areas are known for not having beaches, just lagoons. Beaches on Maui and Kauai are first rate. And I hear that Oahu is built up, kinda like the Miami or jersey shore of the pacific.

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  74. AG says:



    Yeah I locked and Im not happy about it. I know it is pennies we are talking here but a game is a game. I figured its election year and the numbers would be massaged a bit. I still might be able to get my 3.0.

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  76. Jill says:

    Gary #22: And you think Mittens is going to be any better…how?

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