From Bloomberg:
Long-shrinking homes begin to grow again
Even as the U.S. economy struggles to rebound from the worst recession since the Great Depression, Americans are living larger.
Larger, as in larger homes: two-story foyers, twin front staircases, children’s wings, dedicated man caves, coffee bars, four-car garages and bedroom closets large enough for a fifth vehicle.
The percentage of new single-family homes greater than 3,000 square feet has grown by one-third in the last decade, according to data released last month by the U.S. Census Bureau. Slightly more than 1 in 4 new homes built last year were larger than 3,000 square feet, the highest percentage since 2007.
…
Census Bureau reports that the average size of a U.S. house rose in 2011 to 2,480 square feet, up from 2,392 square feet in 2010. The 2011 figure is 62.6 percent larger than the 1,525-square-foot average size in 1973.Demand for large, luxury homes began dropping in September 2005, said Christopher Gaffney, a group president for Toll Brothers home builder, right after Hurricane Katrina ravaged the Gulf Coast. Since then, it’s been an up-and-down cycle. “It was just a matter of when things would turn around, not if,” Gaffney said. “People got tired of putting their lives on hold.”
…
Danny Jong, a New York commercial and residential real estate investor, needed a place for his mother and the children that he and his wife would like to have.“I grew up in a big house,” said Jong, 41, who was raised in New Jersey. “Why not go bigger if you can afford it?”
He said he’s not sure what he’ll do with all the space in the Toll Brothers house he bought in Randolph, N.J. A live-in housekeeper will take up some room. He said Toll Brothers’ reputation for quality, low interest rates, price per square foot and proximity to his New York office influenced his family’s decision.
Frist!
From the WSJ:
Tax Liens Trigger More Foreclosures
When Elsa Dabreo inherited a house from her late father, she thought it was the best thing that ever happened to her. But now she is struggling to keep it.
The house, in a suburb of Boston, was mortgage free and valued at about $330,000 when she received the deed in 2005. However, it was saddled with $20,000 in back taxes which Ms. Dabreo, now 54 years old, couldn’t pay. In 2010, after the taxes and penalties had ballooned to $42,000, the city of Weymouth, Mass., sold the debt at a tax-lien auction. If Ms. Dabreo can’t pay the debt, she could be subject to foreclosure.
Relatives advised her to sell the home and pay off the debt, but she refused. “I wouldn’t be honoring my father’s memory if I sold the home that he worked so hard to buy,” said Ms. Dabreo, a former child-care worker who is now unemployed. She recently filed for bankruptcy and hopes to keep living in the home—which has fallen in value to $296,000.
A report released this week by the National Consumer Law Center, says Ms. Dabreo’s situation isn’t unusual. Although mortgage default is behind most home foreclosures in the U.S., the number of foreclosures tied to delinquent tax payments is climbing. The NCLC, an advocacy group, estimates that $15 billion of tax-lien foreclosures happened in 2010, the latest year for which data are available.
Rising tax-lien problems stem from two overlapping trends associated with the weak economy: To close budget deficits, some local governments are increasing property taxes to raise additional revenue. But a growing number of homeowners, many unemployed or living on fixed incomes, are finding those tax bills—even before rate increases—a strain. When homeowners fail to pay, municipalities have the legal authority to foreclose or auction off the tax lien to debt collectors, who can charge interest rates as high as 50% on the outstanding balances. If the homeowner doesn’t pay—the deadlines to do so vary across the nation—many states allow the tax-lien holders to take ownership of the properties and resell them.
Brad Westover, executive director of the National Tax Lien Association, an industry group, defended the process. “It is a financial service that benefits local governments with the funds needed to operate, the investors with a reasonable interest rate on annual returns, and often times benefits the delinquent taxpayers with a decreased interest rate than if the tax lien was never sold,” Mr. Westover said.
While the sales are causing distress for some homeowners, they reflect hard fiscal realities at the state and municipal level.
“Cities and towns are facing their own budget problems and of course need homeowners to make prompt tax payments,” says John Rao, an NCLC attorney who wrote the report. Homeowners are slipping on tax payments for the same reasons they are falling behind on mortgage payments, Mr. Rao said: “They’re unemployed, or underemployed, expenses have gone up, and you don’t have enough money.”
How many foreclosures have our high property taxes caused? That is a number I’d love to see…
Remember all of the outrage over ARM loans recasting higher? Politicians everywhere were wagging their fingers at the banks for providing such a dangerous product to the public. Unexpectedly rising payments could cause foreclosures.
Judging from the past few years, property taxes have gone up higher than ARM rates have, and in many cases, have created a “recast” situation just the same.
Funny, no politician outrage about this.
“mortgage free and valued at about $330,000 when she received the deed in 2005. However, it was saddled with $20,000 in back taxes which Ms. Dabreo, now 54 years old, couldn’t pay. …. Relatives advised her to sell the home and pay off the debt, but she refused. “I wouldn’t be honoring my father’s memory if I sold the home that he worked so hard to buy,” said Ms. Dabreo….”
Let me see if I understand theis: when she received the house, her father had already fallen way behind in his taxes; she has no way to pay the taxes other than selling the house and if she does not sell it to pay the taxes she will lose the house; but, selling the house that her father placed in a deep tax hole is some kind of insult to him? I suppose having the house taken is far kinder to his memory than selling it. Gimme a freaking break.
“outrage over ARM loans recasting higher? Politicians everywhere were wagging their fingers at the banks for providing such a dangerous product to the public. Unexpectedly rising payments could cause foreclosures.”
Grim,
The real 1% that people should be speaking of id pressuring every level of government to cut budgets in real terms by 1% per year. “What, you cant find 1% in savings over last yera? Are you that pathetic?” The exercise, if carried out over a ten-year period would take much of the taxing pressure off of taxpayers. Of course, it would also require that elected officials actually face the pension and “entitlement” (God how I hate that word) monsters that threaten to devour us all, but they will have to face it sometime. Concurrent with the 1% reduction, the People would do well to eliminate pensions for elected office. If the People want to give elected officials 20,000 or 30,000 to deposit into a solo 401k for the years they serve, whatever. But, to let politicians see a real pension at the end of a “career” in elected office just encourages them to ruffle as few feathers as possible in the quest to get their pension, all at the expense of doing what needs to be done.
It’s time for a property tax clawback. If the officials don’t comply, they will be prosecuted.
#5 Shore: or one could look at it another way. A 54 year old gets a house mtg free, and all she needs to do is come up with 20k to keep it, and she could nto manage to do that little.
Jill: From yesterday. Thanks for the update. It is an odd house,(lay out wise) but was concerned about the area first. I thinkit is over priced by about 40k, but hey that is just me.Not crazy about the 1 bath either. A new listing just came on Beech St in WT at 379K. Doing a drive by today.
Open house today in the Brig. Wish us luck, we will need it.
[2] grim,
House in Weymouth. There’s the problem. You couldn’t give me a house in Weymouth.
Okay, back to work. Clean the house, lock up the valuables, water the plants, sedate the kids …
#10 com Guess I missed it all. You are moving? Where are you going back to Mass?
grim (4)-
If I had an ARM, I’d sue the bank and say that my rates were being adversely affected by LIBOR manipulation.
vb – previous thread
I wouldn’t believe any rumors about the high tension line being removed until I see the plans published by JCP&L, approved by the state (together with the electrical rate increase needed to pay for this job), and the work actually started. This line is a major part of the grid. For that matter, I heard these rumors about 20 years ago…
Regarding “Y” afterschool childcare for the grade schools, lots of people use it (we’d used a few years back. Then, it had been mostly run by the Y but hosted in the schools). No clue why/if it is more expensive than Summit, maybe busing costs more?
Thought the LIBOR manipulation was to push rates down, so that traders could borrow under “market”, not upwards, which would impact mortgage rates.
If anything, it was stealth housing stimulus.
OT” I can’t open Microsoft Outlook, getting some message abiut going to soem file for help, only cannot access the file. Any suggestions?
3b:
Do you use Outlook with a Hotmail/Yahoo/Gmail account or do you have it set to work with an Exchange Server (i.e. connected to a company server or application service provider)?
[15] Thanks again cobbler.
The difference is about 20K per child over 6 years (K-5). It costs 40K at BH Y and 20K in the other Ys!
vb – I think it’s only about $60 per month difference, not at all double, if you compare apples and apples (I mean, same exact schedule and same year; Summit tends to price a la carte) – for that matter BH “Y” is a branch of Summit’s.
#18 Sterling: I have it connected to my optonline e-mail if that helps?
[2] Find / replace via notepad:
When Elsa Dabreo inherited a house from her late father, she thought it was the best thing that ever happened to her. But now she is struggling to keep it.
The house, in a suburb of Boston, was mortgage free and valued at about $330,000 when she received the deed in 2005. However, it was saddled with $20,000 in back rent which Ms. Dabreo, now 54 years old, couldn’t pay. In 2010, after the rent and penalties had ballooned to $42,000, the city of Weymouth, Mass., sold the debt at a rent-lien auction. If Ms. Dabreo can’t pay the debt, she could be subject to foreclosure.
Relatives advised her to sell the home and pay off the debt, but she refused. “I wouldn’t be honoring my father’s memory if I sold the home that he worked so hard to buy,” said Ms. Dabreo, a former child-care worker who is now unemployed. She recently filed for bankruptcy and hopes to keep living in the home—which has fallen in value to $296,000.
A report released this week by the National Consumer Law Center, says Ms. Dabreo’s situation isn’t unusual. Although mortgage default is behind most home foreclosures in the U.S., the number of foreclosures tied to delinquent rent payments is climbing. The NCLC, an advocacy group, estimates that $15 billion of rent-lien foreclosures happened in 2010, the latest year for which data are available.
Rising rent-lien problems stem from two overlapping trends associated with the weak economy: To close budget deficits, some local governments are increasing property rent to raise additional revenue. But a growing number of homeowners, many unemployed or living on fixed incomes, are finding those rent bills—even before rate increases—a strain. When homeowners fail to pay, municipalities have the legal authority to foreclose or auction off the rent lien to debt collectors, who can charge interest rates as high as 50% on the outstanding balances. If the homeowner doesn’t pay—the deadlines to do so vary across the nation—many states allow the rent-lien holders to take ownership of the properties and resell them.
Brad Westover, executive director of the National rent Lien Association, an industry group, defended the process. “It is a financial service that benefits local governments with the funds needed to operate, the investors with a reasonable interest rate on annual returns, and often times benefits the delinquent rentpayers with a decreased interest rate than if the rent lien was never sold,” Mr. Westover said.
While the sales are causing distress for some homeowners, they reflect hard fiscal realities at the state and municipal level.
“Cities and towns are facing their own budget problems and of course need homeowners to make prompt rent payments,” says John Rao, an NCLC attorney who wrote the report. Homeowners are slipping on rent payments for the same reasons they are falling behind on mortgage payments, Mr. Rao said: “They’re unemployed, or underemployed, expenses have gone up, and you don’t have enough money.”
Dammit. I can’t get any rest from stinking liberals and they put one up as the damn nominee of my damn party. If we had nominated Michelle Bachman or Sarah Palin, we wouldn’t be hearing all this damn crap from the stinking Obama campaign team about tax returns and damn Bain Capital. Since the stinking RINO’s usurped the damn primary and put Romney at the head of the ticket, that’s all the hell we’re gonna hear about. Dammit–these stinking RINO’s make me want to puke. All we wanted was purity and we got damn Romney. The damn RINO’s have conspired to silence the tea party. When the hell was the last time you heard anything about Palin or the damn tea party? These damn RINO’s are treating us like some damn “other woman” —you want to have a good time with us, but don’t want to walk down the damn aisle in broad daylight where everyone can see us together. That’s bullspit.
Let me tell you something, if you’re a RINO, you’re lower than a stinking liberal and this crap of forcing Romney down our damn throat ain’t gonna work. THE ONLY WAY I’M VOTING FOR ROMNEY IS WITH PALIN OR BACHMAN AS VEEP. If he doesn’t give us that, you can damn well betcha that the rock ribbed contingent will STAY THE HELL HOME.
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3b #9: Did you do a drive-by? I will check it out in the AM. There are 3 ranches on Beech St. that have been on the market recently. One was an estate sale that needed tons of work, another sat on the market for a LONG time. I’m not familiar with this one but I will check it out in the AM. Beech is nice (that’s the part of town I live in). It’s not as busy as Colonial, but it’s wider than many of the surrounding streets. The only thing with that neighborhood is that if you leave the house any later than 7:20 AM, you have to take the back roads out to Pascack Road by the strip mall because Ridgewood Road backs up with high school traffic.
Shore report – Hot rain tonight. Beaches are great not too crowded and finding parking has been a breeze, in Belmar, Spring Lake etc. Seems like less people this year perhaps the economy since Point Pleasant at noon on Saturday had plenty of parking by the boardwalk and short lines for the kiddie rides. The restaurants aren’t overloaded either. Lots of rental signs on the lawns around the beach towns seems like people have been staying home. Traffic has been light perhaps the new easy pass lanes or just less traffic even when coming home tonight in the rain. DJ’s Happy hour had a line like always. I really wish I could buy that place it seems timeless. My cousins 10 br rental in Belmar is empty and most likely will be going back to the bank. Less kids partying and no flip cup or bean bag games perhaps the new people in charge down there ave outlawed fun.
http://www.bloomberg.com/news/2012-07-15/romney-s-bain-yielded-private-gains-socialized-losses.html
[13] 3b,
Nowhere yet. Goal is to relo to SEPA. Was house hunting in Chadds Ford and thereabouts yesterday. But have to get this place sold first.
Returned to the house after the OH, and there was someone on my lawn. Couple from Delaware missed the OH. Because they had driven a long way, I called the agent back (she actually saw me talking to them and had u-turned). Turns out they were looking for smaller and cheaper and we agreed it did not make sense for them to look at my place. But they seemed predisposed to the Brig; the husband was familiar with Chatham/Madison/Summit and they shared my low opinion of those towns.
They may buy a house up the street from me that is much smaller and on a smaller lot. What ends up happening though is that they outgrow it and decide to buy a place like mine. Happens all the time here in the Brig.
[27] yo,
Americans historically have never elected successful people to the presidency, or many other offices for that matter. Look back at how many of our former presidents were failures in business (e.g., Lincoln and Truman) and how they are treated versus those who were successful in business (Hoover and Johnson). And look at the track record of those who ran for high office who did not come up through the political ranks. It’s almost nonexistent.
Despite the disdain americans profess for politicians, it’s clear that they prefer politicians over those who are successful in other fields. And TPTB insure that.
Romney doesn’t have a chance. I always knew that. If I had his millions, I’d be content to remain quasi-anonymous and making more millions rather than trying to go on some do-gooder mission that no one wants anyhow. You don’t see Larry Ellison running for anything, do you?
Hey Nom, you didn’t build your practice, somebody else did that; the president told me so:
http://www.youtube.com/watch?v=C-ZO7XOpwa8
#30 Shore
I thought you said your career was built on the back of a D1 football scholarship and political contacts.
I think O makes a fair point. A lot of people can attribute their success straight back to infrastructure and policies defined by government.
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