North Jersey Contracts – August 2012

(Source GSMLS, except Bergen which is NJMLS)

Pending Home Sales (Contracts)
——————————-

Bergen County
August 2011 – 589
August 2012 – 707 (Up 20% YOY)

Essex County
August 2011 – 258
August 2012 – 348 (Up 34.9% YOY)

Hunterdon County
August 2011 – 92
August 2012 – 124 (Up 34.8% YOY)

Morris County
August 2011 – 333
August 2012 – 475 (Up 42.6% YOY)

Passaic County
August 2011 – 145
August 2012 – 260 (Up 79.3% YOY)

Somerset County
August 2011 – 220
August 2012 – 322 (Up 46.4% YOY)

Sussex County
August 2011 – 106
August 2012 – 150 (Up 41.5% YOY)

Union County
August 2011 – 245
August 2012 – 305 (Up 24.5% YOY)

Warren County
August 2011 – 80
August 2012 – 107 (Up 33.8% YOY)

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121 Responses to North Jersey Contracts – August 2012

  1. grim says:

    These are some incredibly strong numbers for August, even if we assume a higher level of cancellations.

    This is the strongest August in quite some time. For example:

    Morris County Contracts

    August 2006 – 480
    August 2007 – 381
    August 2008 – 356
    August 2009 – 434
    August 2010 – 348
    August 2011 – 333
    August 2012 – 475

  2. Superman says:

    Super!!

  3. Brian says:

    Good news. I wonder who is buying. Have the first time buyers come back to the market?

    I wasa at a wedding this weekend for one of my wife’s cousins. Couple of millenials getting married. They bought a townhouse and a garage unit without a second thought. They spoke as if that’s just what people do….next step for them would be kids he said. No fear of home buying for him or his new wife. It helps that they’re lucky enough to both still have good jobs.

  4. grim says:

    Ok – Just a pet peeve here. Why do so many articles that discuss underwater mortgages point to an improving jobs situation and wage growth as the solution?

    That’s not the case at all, as best job and wage growth are indirect drivers, if drivers at all.

    The only thing that fixes underwater loans are increasing home prices and time to allow for additional paydown of principal. (Yes, to some extent additional deleveraging would work here, but isn’t that just the same as bringing a check to closing?)

    The issue here isn’t jobs and wages, it’s the sunk cost fallacy. People simply can’t stomach selling a house for less than they paid for it, so they won’t, whether they can afford to bring a check to closing or not.

    Hell, if we see an environment of improving unemployment numbers and wage growth, without corresponding home price increases, I think this effect becomes even stronger as owners feel more confident that prices will increase and they can ride it out (and then cash it out).

  5. grim says:

    Like this one, from the Hartford Courant this morning:

    Buying House Before The Bust Leaves Family Mortgage Underwater, But They Have Plenty Of Company

    Joe and Siobhan DeGray thought they were doing everything right when they bought their Newington house in 2007: They found a modest, two-bedroom starter that they planned to stay in for a few years, then sell and buy a bigger home as their family grew.

    Five years later, their family is larger — by two — but the rest of their plan fell apart. The housing recession has pushed the value of their home $26,000 below what they owe on their mortgage. The couple would have to ante up the difference to sell the property and pay off their loan.

    They’re stuck.

    “We could afford a larger home,” Joe DeGray says. “We just can’t afford to sell this one.”

    Job growth in the state, key to a housing recovery, is expected to remain weak through 2013, according to a forecast last week. Home sales have edged up, but prices still remain weak. And when sale prices begin moving up consistently, it could be a slow slog, maybe as little as 2 percent a year, compared with 5 percent or more in a healthy market, economists say.

  6. Mike says:

    Good Morning New Jersey

  7. Mikewaited says:

    Grim 1 – It would seem my timing was impeccable once again, we shall see………….

  8. Ernest Money says:

    It’s all headed off a cliff at 140 mph. Print and repudiate.

  9. Pierre says:

    It is job and wages. Local wealth is what makes the home worth. Remember locatio location location. You would not drop half a mil in Rwanda

  10. grim says:

    From the Record:

    Foreclosures among owners of million-dollar homes on the rise

    Elvira Grau, the Englewood-based party planner who appeared on “The Real Housewives of New Jersey,” and her husband have lost their $3 million Cresskill home to foreclosure.

    It’s one of a growing number of high-end foreclosures — a sign that housing distress is not limited to lower-income neighborhoods.

    Elvira and James Grau own Space Odyssey, a former warehouse in Englewood that they bought in 2005 and turned into a 26,000-square-foot entertainment venue. Elvira Grau made an appearance on “The Real Housewives” reality show in 2010, planning a party for one of the show’s stars, Teresa Giudice. But the Graus were apparently not able to keep up with the $17,500 monthly payments.

    Million-dollar-plus foreclosures like the Graus’ are rare, but are on the rise, according to RealtyTrac, a California company that follows the foreclosure market. Although the numbers of foreclosures on properties with mortgages over $1 million are still tiny — less than 2 percent of all foreclosures nationwide — they’ve more than doubled since 2007, RealtyTrac said. In Bergen County, more than 70 foreclosures of million-dollar-plus properties have been auctioned since January 2010, according to the sheriff’s office.

    For buyers of luxury homes, the rising number of foreclosures in this price range offers the potential for better deals, since foreclosed homes generally sell at discounts that could total hundreds of thousands of dollars.

    High-end homeowners in trouble have taken longer to fall into foreclosure because they typically had more of “a financial cushion to fall back on, to keep making their mortgage payments,” Blomquist said. “They’ve been able to hold out longer.”

    “We’ve seen instances where the husband and wife both worked on Wall Street, and three years ago, they lost their jobs,” she said. “They’re doing different jobs and living in homes with mortgages up to $1 million, and there’s no way they can pay that.

  11. grim says:

    It is job and wages. Local wealth is what makes the home worth.

    Yes, today, but what is going to drive home prices tomorrow? The bubble showed that home prices could detach from jobs and wages on the way up, therefore its entirely reasonable that home prices could detach at the bottom as well. Plenty of folks feel that a home price recovery is a long shot, even if the economy/jobs recover. In this scenario we might see fewer people dive underwater, but there would be no dynamic to reduce the overall number of underwater homeowners other than time.

  12. 1987 Condo buyer says:

    #11 Time, agree. For instance, while gary is right about over priced homes, do those folks have to sell? Even a 75 year old could hang on another 20 years before it becomes an estate sale….things can stay “irrational” longer than many would like..

  13. Brian says:

    Answer:

    Fear and Greed.

    11.grim says:
    September 4, 2012 at 7:46 am
    It is job and wages. Local wealth is what makes the home worth.

    Yes, today, but what is going to drive home prices tomorrow? The bubble showed that home prices could detach from jobs and wages on the way up, therefore its entirely reasonable that home prices could detach at the bottom as well. Plenty of folks feel that a home price recovery is a long shot, even if the economy/jobs recover. In this scenario we might see fewer people dive underwater, but there would be no dynamic to reduce the overall number of underwater homeowners other than time.

  14. yo says:

    Home prices have declined and are in line to the trend of 1% above inflation housing increase.This is in the affordable scale nationally, add low interest rates and a decrease of homes in the market. 80% of the population are working,immigrants coming in to the country annually.New formed families need a home to live.Prices have nowhere to go but up.The key is mortgage being lower than renting.Property tax can be justified by services and kids using the school system.Banks have the capability of holding foreclosed homes away from the market..

  15. 3B Buying says:

    #4 Agreed!

  16. 3B Buying says:

    #5 Seems to me if you cannot afford the loss of 26k, you cannot afford the larfer home.

  17. 3B Buying says:

    #12 Agreed, reluctantly. The problem is those who are trying to be rational, are dealing with both the irrational sellers, and irrational buyers that are out there.

  18. 3B Buying says:

    #14 As the child of immigrants, I can tell you that even today, most immigrants will start in an apartment before going the home buying route. Then you have to assume the immigrants will have the type of jobs that will enable them to afford a house and keep it. Especially with NJ property taxes. For many immigrants that have been here only a few years, a 10k to 12k or more a year property tax bill would be a tough nut to handle. You might be able to argue prices will stabalize (I still think there is another leg down), but to say prices have nowhere to go but up, is wishful thinking on your part.

  19. Ragnar says:

    What will drive up home prices? Nominal wages. The government will pass a law saying that everyone will get paid at least $75,000 per year. Just watch the DNC the next 3 nights and you will belieeeeeeeeeve.

  20. Ann says:

    Re the people in the Hartford article, they did not “do everything right” you dumb but kind newspaper writer. Buying a 2 br when you are planning on having kids is one of the dumbest things you can do.

  21. Ernest Money says:

    We are digging a hole to China. No recovery until civil war/world war/planetary default and reset.

  22. grim says:

    It’s entirely possible that we might see a scenario where some “underwater” homes are resolved through improvements, as “stuck” homeowners opt to remodel/expand instead of moving. I think we’re starting to see some of this trend already. This obviously doesn’t directly apply to owners who borrow to finance the remodels/expansions, but those who do it out of savings. You might argue that dollar for dollar, this is an irrational approach since the net value of an improvement is always less than the cost. However, we’re not talking about rational behavior at all.

    Say an underwater homeowner has $30k saved that they were going to put towards a new purchase, but they find out instead that they need to bring a $30k check to closing. In every case I think the owner would rather opt to “invest” that $30k into remodel than use it to service debt and execute the sale.

    Indirectly, if this behavior keeps people in their current homes for an additional 5-10 years, there’s a good chance they’ll see the underwater situation resolve due to time, maybe even recovering some of their overall investment.

    The impact to the longer term local trends is a continuation of what we saw during the bubble, an improvement of the overall housing stock that begins to impact overall affordability. When the owner of a cape adds a level to gain a few extra years out of their property, they’ve reduced the number of affordable properties by 1.

    To some extent we’re already seeing this today, being driven by foreclosure/investor sales. That REO that finds a buyer at $300k doesn’t represent a $300k property on market, that $300k property is the raw material the investor will use to return a $400-500k property to market. This is one of the reasons I think it’s troublesome to look at these sales as indicative of overall home price trends. That $300k sale, while it may be under average, doesn’t in any way represent the addition of a $300k home to the market.

  23. yo says:

    #18 As an immigrant myself,you will still need a home to rent to live on. Either way ,high demand on rent will bring rent up or high demand on private homes will bring prices up.Eventually with family members living together with jobs.Family decide to buy a single or muti family home.4 or more family members working they will find buying is cheaper than renting.I know many including myself went on this route.Most of the ones I know bought within 6 years of living here.I lived with my BIL for 5 years until I was able to save for downpayment.Ofcourse I handed him some money but not close to the cost of renting.The other family members bought a two family home.Cheaper than renting two units.This was in the 90’s when you can put a 5% down.

  24. Ann says:

    Re #4 maybe they are trying to get Obama re-elected by acting all chipper? If 50% of mortgages are in effective negative equity and return buyers are gone from the market, the market will not recover. Even in my “upscale” BC neighborhood, even the relocations are turning into rentals because people can’t sell. The divorcers are going into default. The only people who can sell are people who bought pre-2000 but they still feel a lot poorer doing it.

  25. Brian says:

    22 –

    Hey, you callin’ me irrational? Eh, you’re probably right.

    Anyway, Grim, they’re keeping me way too busy at work lately to keep checking your blog. Would you kindly email me when home prices are irrationally high in my area again so that I can dump my sh1tshack on some hopeful but unsuspecting millenial?

    Thanks

  26. yo says:

    #20 Ann

    They could chose to stay put.Many families living in a 2 bedroom with bunkbeds.Problem is,we still have that kind of mentality.Common sense tells you,you gain what you loose when you trade up.A loss of $26,000 to what you sell is a gain to what you are buying.Problem is they don’t want to loose the $26,000 if they sell, but they want the seller of the bigger home to take the lost. You are right,that article is a one sided opinion

  27. grim says:

    If 50% of mortgages are in effective negative equity and return buyers are gone from the market, the market will not recover.

    I think the latest number I heard was closer to 30%.

    Or are you referencing that 48% of owners under 40 are underwater stat that made the rounds? Honestly, I think it’s a bit misleading as this has more to do with the fact that this age cohort coincides with peak buyers, as they were in their prime home buying years at the top of the market. In addition, that cohort also purchased during a period of lax mortgage standards which allowed very low downpayments (making it very easy to get underwater). It’s an interesting stat, but it’s really only stating the obvious in a novel way.

    return buyers are gone from the market

    What is a return buyer? Buyers are clearly not gone from the market as evidenced by the August contracts numbers (or any other month in this current year). We’re talking about the best August in 6 years.

  28. Ernest Money says:

    Let’s see what the sales activity is like when we come to our Argentina moment.

  29. grim says:

    Hey, you callin’ me irrational? Eh, you’re probably right.

    You can easily make the numbers work in the favor of staying with a remodel. Cost of sale and moving are going to wildly outweigh the net losses associated with improvements (in the short term of course, since you are really just delaying those costs).

  30. yo says:

    All this talk,always comes to supply and demand.Right now demand is increasingly more than supply.Where is the price going?We can say 50% of homeowners are in negative equity but are not selling and staying put and the ones with equity are selling and moving up.If demand is more prices go up,eventually the underwater mortgages will catch up.Remember HARP has made underwater homeowners be able to afford their homes.Going from 6% interest rate to 3.5% interest rate is a big decline on the monthly payments.Most of this people can choose to stay put.

  31. Ann says:

    Re # 27 ……..Maybe just looking at mortgages, but if you add in the costs of selling (realtor fees etc) then 50%, from Mark Hanson…

    “On US totals, if you figure average house prices use conforming loan balances, then a repeat buyer has to have roughly 10 percent down to buy in addition to the 6 percent Realtor fee to sell. Thus, the effective negative equity target would be 85%. You also have to factor in secondary financing, which most measures leave out.

    Based on that, over 50 percent of all mortgaged households in the US are effectively underwater — unable to sell for enough to pay a Realtor and put a down payment on a new purchase without coming out of pocket. Because repeat buyers have always carried the market as the foundation, this is why demand has not come back. It’s as if half the potential buyers in America died over a two-year period of time.”

  32. Ann says:

    Here’s more with a link to graphs…

    http://mhanson.com/archives/991

    “For years I have proclaimed that “no housing recovery will ever occur — or no dead-cat-bounce will reach “escape velocity” or become “durable” — unless the repeat buyer is leading the way. This is because investors and first-timers are thin, volatile cohorts who have been known over history to leave the market literally, overnight…..

    The problem is that the mortgaged homeowner has always been the primary demand cohort. It’s not investors, first-timers or those who own their homes free and clear. Rather, the mortgage-levered homeowner who tends to move every 6 to 8 years who provides most of the historic underlying support for macro housing.

    This is a problem. Put simply, there are more houses today then there were five years ago but a full HALF of the primary demand cohort — repeat buyers — died due to negative equity, “effective” negative equity, poor credit or legacy HELOCs, all of which prevent sellers (repeat buyers) from paying a Realtor 6%, putting 10% to 20% down on a new purchase, and getting a mortgage for the remainder. Put even more simply, housing “supply” has grown in the past 5 years and ready and able buyers have been cut in half.”

  33. grim says:

    Here are the Corelogic Q1 2012 numbers:

    http://www.corelogic.com/about-us/researchtrends/asset_upload_file912_15196.pdf

    Looks like the current number is 23.7% of all mortgages in negative equity countrywide. For NJ, it looks like 18.9% of all mortgages are underwater.

  34. Fast Eddie says:

    yo [14],

    Property tax can be justified by services and kids using the school system.

    BWAHHAA!!! You are a f*cking scream! Yes, it’s for the children. Our school systems are nothing more than a bureaucratic factory.

  35. grim says:

    31 – Statewide the “near negative equity” share is only an additional 4.2%, which would encompass the scenario described by Mark. This increases the local number to 23.1% of “mortgaged” properties. Still nowhere near the 50% number, and lightyears away from the 85% figure (which is just silliness outside of the sand states).

  36. grim says:

    I’m trying to dig up the overall mortgaged home share as a percentage of all homes in NJ, but I believe the number is somewhere around 70%. So to be accurate, we should be describing the number as the total of all homes, not the total of mortgaged properties. So we’re really talking about 18.9% of that 70%, not the 100%.

    That effectively brings the number down somewhere near 13% of all properties in NJ. A far, far, far cry from any kind of 85% figure.

  37. 3B Buying says:

    #34 Fast: Speaking of the schools, you should hear/see the uproar over River Dell dropping from 27 to 104, in the NJ Monthly School rankings.

  38. Anon E. Moose says:

    Re: [5];

    “We could afford a larger home,” Joe DeGray says. “We just can’t afford to sell this one.”

    O, rly?!? You can’t afford to bring $25k to the closing table to get out of your ‘starter’ house, but somehow you can ‘afford’ to buy a bigger house?

    If you don’t have cash to get out of your current house, exactly what do you intend to put as downpayment on the bigger one? What I suspect Joe DeGray (I’ll just call him Harry Howmuchamonth) means is that he thinks he can afford the payment on 80% of the current market value of a bigger house he’d like to live in, now that prices have receded from their bubbly peaks. That house he bough that someone else paid for and now lost its value, that’s all just water under the brige, right? Let bygones be bygones?

    So Harry Howmuchamonth wants someone, anyone (government?) to waive their majic wand and bend the reality of money and finance to his will, so he can get into this new and bigger house with nothing down, because, you know, that worked out so well for everyone who did it in 2006.

  39. yo says:

    #34 Fast

    We are in a different league.You are looking at properties that property tax cost $18000.I am more of the common middleclass person.My league is $6000 in property tax with 2 kids that used the school system. I get garbage pick up 2x a week.I just call if I have heavy things need picked up.They pick up grass and clippings once a week.Over all I see the garbage guy 3x a week.I get Police protection 24 hours a day.Dial 911 cop is at my door with in 5 minutes.They flow and salt my road during winter storms.All this for the price of $6500.

  40. Ann says:

    36 grim I’m confused so are Hanson’s graphs wrong or are we comparing two different things? He’s showing NJ as 49% effective negative equity (over 50% if you count HELOCs) and he’s saying all households, not just mortgage holders.

  41. 1987 Condo buyer says:

    #39, I pay $7,900 for similar, Essex County!!…only difference, I’ll have a cop at my door in 90 seconds…..(2 live on my block!)

  42. Ann says:

    Oh never mind, he says mortgaged homeowners. So that would be 35% of NJ homeowners using the 70% number.

  43. grim says:

    Ann – Hanson doesn’t reference the source of his figures, does he?

    The core logic numbers I cite include both first and second liens, as well as home equity utilization, they also adjust for normal amortization.

  44. yo says:

    PMI Prior Actual
    Level 51.4 51.5

    ISM
    Prior Consensus Consensus Range Actual
    ISM Mfg Index – Level 49.8 50.0 49.5 to 50.5 49.6

    Construction Spending
    Prior Consensus Consensus Range Actual
    Construction Spending – M/M change 0.4 % 0.4 % -0.3 % to 0.6 % -0.9 %

  45. Ann says:

    grim, I’m assuming he gets them from somewhere, not that familiar with sources of RE data. I think the difference is that he is factoring in costs in order to move on to a new house (realtor fees, taxes, a 10% down payment on the next house).

  46. 3B Buying says:

    #39 Yo: Give it time and your town may get up to the double digits in property taxes too, hopefully that won’t happen. For 6500, no you cannot complain. But there are lots of middle class/blue collar whatever you want to call them towns in Bergen Co where property taxes are 10k and over, and rising every year.

  47. grim says:

    45 – Well gee, that’s pretty disingenuous. Let’s make up our own definition of negative equity that significantly overstates the problem, and use that to elicit all sorts of shock, awe, and … well … publicity.

    The problem is his assumption is that all mortgaged households essentially have zero savings from which to finance sales costs and down payments, and this isn’t the case.

  48. 3B Buying says:

    #38 Anon: That is what I said. In the scheme of things bringing 26k to the table to get out of your msitake does not seem bad.

    And it appears the guy has no sense, again how can he say he can afford a bigger house but not the 25 k loss. As soon as I read that it jumped right out at me. Now if I had been the one writing/interviewing the guy, I would have asked him that point blank.

  49. Jill says:

    So, 3b…did you bid on the Jackson Ave. house? Or another one? (Sign is still out on Beech St….)

  50. grim says:

    I also believe his thesis of “repeat buyers” driving the market to be inherently flawed.

    Traditionally, the market is driven by net new entrants and exits (activity at the margins setting prices). Thus, in-migration and new home buyers purchasing available inventory without themselves adding to inventory, and out-migration and exits (deaths, elderly owners moving to assisted living, etc) adding additional inventory. Another way of looking at this is overall new net demand and inventory. (for the sake of this example I’ll leave out new construction and net new housing stock since it’s minor in our area).

    Repeat buyers and sellers are essentially trading homes between each other (demand and supply are balanced). Without new entrants to act as triggers to enable the first repeat sale, and net exits to enable the subsequent move ups, the market remains status quo (other an changes in housing stock due to improvements and deterioration, and of course, inflation).

    Most people tend to focus on the first-time buyers as being the most critical piece of this, but I’ll argue that deaths and out-migration are equally as important. If the move-up has nothing to buy, there is no inventory for that FTB to purchase.

  51. 3B Buying says:

    #49 Jill: We are back and forth on whether we like it enough to bid on. I am hoping for a price drop and then perhaps we will bid. Beech was the one we should have bid on. A lot less cosmetics to do on that one, and a much more realistic price IMO.

  52. grim says:

    Speaking of … Corelogic July 2012 HPI is out.

    http://www.corelogic.com/about-us/researchtrends/asset_upload_file982_16384.pdf

    New York-White Plains-Wayne, NY-NJ
    Home Prices Including Distressed – Up 3.4% YOY
    Home Prices Excluding Distressed – Up 3.1% YOY

    New Jersey (Statewide)
    Home Prices Including Distressed – Down 0.8% YOY
    Home Prices Excluding Distressed – Down 1.2% YOY

    Pennsylvania (Statewide)
    Home Prices Including Distressed – Up 1.7% YOY
    Home Prices Excluding Distressed – Up 2.5% YOY

    New York (Statewide)
    Home Prices Including Distressed – Up 5.4% YOY
    Home Prices Excluding Distressed – Up 5.2% YOY

  53. Brian says:

    You are allowed to stop paying property taxes when you promise never to use the services of a public High School graduate for any reason.

    34.Fast Eddie says:
    September 4, 2012 at 9:51 am
    yo [14],

    Property tax can be justified by services and kids using the school system.

    BWAHHAA!!! You are a f*cking scream! Yes, it’s for the children. Our school systems are nothing more than a bureaucratic factory.

  54. 3B Buying says:

    #53 Brian: The problem with property taxes and schools, is that those of us who question and think, are over ruled, by those who do not. So even when we know, that the decesions being made by BOE members, and in cases where voted on by the public such as spending referendums are wrong and will will lead to problems, we are over ruled, and left with the mess, and higher property taxes.

  55. Brian says:

    Grim, saw this in the previous thread. My 3yr old has a tonka truck that’s mostly metal. Prolly made in China though (maybe I’ll check when I go home 2nite). I guess it’s the “might dump”???? Not sure. He used to beg me to push him down the hill in our yard in the thing a lot when he was two.

    Although I will say, he plays with his plastic tonka rescue helicopter with rotating blades, siren and rescue winch much more often.

    29.grim says:
    September 3, 2012 at 10:48 am
    21 – I agree, and I’ll bring up the reference I usually point back to, the death of the all-metal Tonka truck, which coincides perfectly with start of the Gen Y/Millennial childhood period.

  56. Brian says:

    Yeah I actually would agree to some extent. In Sparta, they put spending money on a new artificial turf football field and new track to a vote. They wanted to sell a few mil in bonds to rebuild the field. People came out in droves and voted it down. No one there can stomach any more tax increases. BOE there just keeps saying they will find some way to do it. They just won’t accept the word NO.

    What’s the deal with these new artificial turf field for all the high schools lateley anyway? I always played on dirt. What’s the advantage?

    54.3B Buying says:
    September 4, 2012 at 11:42 am
    #53 Brian: The problem with property taxes and schools, is that those of us who question and think, are over ruled, by those who do not. So even when we know, that the decesions being made by BOE members, and in cases where voted on by the public such as spending referendums are wrong and will will lead to problems, we are over ruled, and left with the mess, and higher property taxes.

  57. chicagofinance says:

    Either a liar with pure balls or else hopelessly out of touch with reality…you choose…..should we take a poll?

    What grade would you give President Barack Obama on the economy? He gave himself an “incomplete” in an interview broadcast Monday by Colorado’s KKTV.

    News Anchor Dianne Derby asked the president: “Your party says you inherited a bad situation. You’ve had three and a half years to fix it. What grade would you give yourself so far for doing that?”

    “You know I would say incomplete,” the president replied “But what I would say is the steps that we have taken in saving the auto industry, in making sure that college is more affordable and investing in clean energy and science and technology and research, those are all the things that we are going to need to grow over the long term.”

  58. chicagofinance says:

    To reiterate: I voted for him and I have always voted for the Democratic candidate in a Presidential election, although I consider myself independent and always have…..

  59. grim says:

    From HuffPo:

    Home Prices Rise In July By Most In Six Years

    U.S. home prices jumped 3.8 percent in the 12 months ending in July, according to a private real estate data provider. The year-over-year increase was the biggest in six years, further evidence that the housing market is steadily recovering.

    CoreLogic said Tuesday that home prices also rose 1.3 percent in July from June. That’s the fifth straight increase in both the monthly and year-over-year price indexes.

    The index is the third national measure to show steady increases. The Standard & Poor’s/Case-Shiller index posted its first annual increase in nearly two years last week. And a federal government housing agency has also reported annual increases.

  60. Ann says:

    50 If a large group of buyers have to stay put now, eliminating a whole chunk of demand that would have bought up, then prices at the mid to higher end can’t recover. You need the whole chain, the entries, the exits and the move-ups, but the chain is broken now, because the move-up buyer is gone. Even though you still might get the first-time buyers, prices won’t recover because there isn’t enough of them on their own (along with investors).

    From what I see, there’s plenty out there for the move-up buyer to buy right now, but if they can’t sell their current homes, it doesn’t matter. Relocators are in the same boat, they end up turning their homes into rentals.

  61. Brian says:

    It should have been Hillary Clinton. I think the country would have been better off.

    58.chicagofinance says:
    September 4, 2012 at 11:57 am
    To reiterate: I voted for him and I have always voted for the Democratic candidate in a Presidential election, although I consider myself independent and always have…..

  62. Anon E. Moose says:

    Brian [53];

    You are allowed to stop paying property taxes when you promise never to use the services of a public High School graduate for any reason.

    If a high-school eduation is such a blessing to society, how come so many of those HS graduates have to take remidial math and english in college, and all must endure another four years to be emplyable in even the most menial of jobs? Heckuva job they’re doing in those High Schools.

  63. yo says:

    #46 3b

    I live in the south side of Edison.I guess I can call my town a “College Town” I am 5 min away from campus.I can call it a “Train Town” I am one block away from the Train station.I don’t think it is a “blue collar town” most of my neighbors does office work in NYC and are college grad.I know $600k homes are rare in this side of town unless you go to the north side and Highland park.Most homes in this area will be at the $250k to $400k at todays price.That is why property taxes are at this price.The town is diverse.Most Indians are in the north side of town.Chinese and Koreans in the south side of Town.Jews in Highland Park next town over from the south side.The school system is not highly rated from those NJ magazine.I think it is rank #90.My eldest graduated from Edison high went to rutgers and now a Accountant.He works for MS.My daughter went to Edison high has two sems left to graduate Rutgers.She is doing internship with Aerosole and was told 90% of interns were hired. So over all I cant complain about my town.

  64. Forrest Gump says:

    62. “take remidial math and english”

  65. grim says:

    You need the whole chain, the entries, the exits and the move-ups, but the chain is broken now, because the move-up buyer is gone.

    Just to be clear that when we say things like “buyers are gone”, what we’re really talking about is the level is lower than some point in the near recent past. Not that they are literally gone, or are at a level near zero. It’s worth noting.

    We’ve probably executed around 50,000 to 60,000 home sales in the state, year to date. We’re on track to execute somewhere around 80,000 to 90,000 this year.

    Yes, we’re down considerably from a heady days of the bubble, where prints around 150-180k sales were expected.

    But, what we aren’t saying is that we need to return to bubble level volumes to achieve stability and price growth, because we don’t. Earliest data I have easily available is 2001 and 2002, which saw prints around 130-140k annual sales. Some folks would argue that the market at that time was already starting to get “hot”, so they aren’t good reference years for “normal”, markets, but it’s what I’ve got.

    If the current rate of improvement can be sustained, from a volume perspective we can return to what most would consider a “normal” volume in the next year or two.

    Just making sure we’ve got the right basis for comparison.

  66. Anon E. Moose says:

    Re [64];

    I see that Timmy has now contributed the highest value input he has to add to the conversation. Thanks, Timmy! You can go back to your Tonka trucks now.

  67. yo says:

    #57 Chi
    I would agree with him.He was handed the worst economy in decades.He had to continue bail outs from previous administration.He had to deal with millions that lost their jobs.He had to keep them with shelter and food.He had to balance between what the right will not and let him do,because they have majority.

    I am a registered Republican but I am leaning towards O simply because,If Romney wins and you have a Republican congress there is no stopping them.There is no more room for debates on the issues it is a one sided.At least now they are debating and talking about the issues.

  68. Forrest Gump says:

    66 – Timmy suggests a remidial writing course for you!

  69. Jill says:

    Brian #61: I’m afraid you are right, if only because Hillary was already familiar with the kind of insanity that grips the Wingnut Party every time someone from their party loses. Obama underestimated the degree of hate and racism that is still endemic in parts of the country, as well as the utter intransigence of the opposition. He’s tried to be a centrist, but the right has gone so far off the lunatic fringe that he only looks like a leftist by comparison. “Obamacare” is Romneycare, and it’s Bob Dole’s plan from 1996.

    Bill Clinton was successful because he knew he was playing with dirty dogs and he got right down into the gutter with them. Obama is trying to hard to keep his hands clean and you can’t do that when dealing with filth.

  70. Brian says:

    Yo,

    Something that I cannot forgive him for is that he stubbornly concentrated on the health care issue when jobs and the economy were priority number one. It was so incredibly frustrating. It made me feel like he was more concerned with his own legacy and his own agenda rather than the issues that were most important to the American people.

    I do understand your fear about one party having all the power though. The last 3 1/2 years are the perfect example…….

    67.yo says:
    September 4, 2012 at 12:59 pm
    #57 Chi
    I would agree with him.He was handed the worst economy in decades.He had to continue bail outs from previous administration.He had to deal with millions that lost their jobs.He had to keep them with shelter and food.He had to balance between what the right will not and let him do,because they have majority.

    I am a registered Republican but I am leaning towards O simply because,If Romney wins and you have a Republican congress there is no stopping them.There is no more room for debates on the issues it is a one sided.At least now they are debating and talking about the issues.

  71. Brian says:

    To your first point…in my own observations, when just listening to conversations that occur over a beer or whatever, most people hate him over policy. Yes, there are some people who judge him for his race, but I think they are in the minority. And since he is half Irish, I take offense to that :)

    To your second point….this is a leadership quality. And this is a quality that Obama lacks. Good leaders know how to work within the system.

    69.Jill says:
    September 4, 2012 at 1:20 pm
    Brian #61: I’m afraid you are right, if only because Hillary was already familiar with the kind of insanity that grips the Wingnut Party every time someone from their party loses. Obama underestimated the degree of hate and racism that is still endemic in parts of the country, as well as the utter intransigence of the opposition. He’s tried to be a centrist, but the right has gone so far off the lunatic fringe that he only looks like a leftist by comparison. “Obamacare” is Romneycare, and it’s Bob Dole’s plan from 1996.

    Bill Clinton was successful because he knew he was playing with dirty dogs and he got right down into the gutter with them. Obama is trying to hard to keep his hands clean and you can’t do that when dealing with filth.

  72. grim says:

    Inventory continuing to tick down as well.

    Morris
    Aug 2001 – 2608
    Aug 02 – 2500
    Aug 03 – 2830
    Aug 04 – 3104
    Aug 05 – 3389
    Aug 06 – 5027
    Aug 07 – 4746
    Aug 08 – 4701
    Aug 09 – 4771
    Aug 10 – 4874
    Aug 11 – 4736
    Aug 2012 – 3890

  73. 30 year realtor says:

    #65 – I believe we will look back on 2012 as being a good year for real estate. There are far too many potential challenges facing an already fragile market for me to believe we will reach 2001/2002 transaction levels anytime soon. In order to return to 140,000 transactions in a year or two would require a 50% increase from current transaction levels. Where are these buyers going to come from? How does such a large increase impact values? I can’t make it add up in my view of the world.

    All that good sense and reason aside, it certainly would be good for my bottom line!

  74. Superman says:

    62. hahahahaaa You can’t spell for shit pal.

  75. Brian says:

    anyone seen 2016 yet?

  76. Comrade Nom Deplume says:

    [75] superman,

    That the best you have?

  77. chicagofinance says:

    Brian: even though the people that judge Obama by race maybe a minority, they are a big, big plurality….and it is disturbingly and annoyingly large. An interesting feature in this discussion is that even many Democrats and African-Americans view Obama on racial terms…..and those people need to look in the mirror and realize that they actually fully particpate and openly wish to have racism continue in this country….my own personal annoyance stems from the fact that O-man is a hack on objective terms, and I deride those that want to paint my opinion with their agendas…..

    Brian says:
    September 4, 2012 at 1:35 pm
    Yes, there are some people who judge him for his race, but I think they are in the minority.

    To your second point….this is a leadership quality. And this is a quality that Obama lacks. Good leaders know how to work within the system.

  78. grim says:

    In order to return to 140,000 transactions in a year or two would require a 50% increase from current transaction levels. Where are these buyers going to come from?

    Based on Aug ’12 and ’11 contracts above, we’re up 35% year on year with ~2800 new buyers in August ’12. Where did these buyers come from? Hell, where did the 50-60k buyers that already executed come from? (I’ve got to admit, big numbers like that boggle my mind sometimes).

    According to the 2010 census, NJ has got 3,176,069 housing units. 2,126,279 are owner-occupied, and 1,049,790 are renter-occupied.

    So, what we’re really talking about is taking the percentage of annual housing turnover (of owner occupied units) from 4% currently up to 6 or 7% (I’d argue that 6 is probably sufficient to bring us back to “normal”.)

    So, we’re really talking about an increase of turnover of around 2-3%.

  79. grim says:

    Shit, that just reminded me of an old Calculated Risk chart that I had saved:

    http://2.bp.blogspot.com/_pMscxxELHEg/ScfN_Xa3LMI/AAAAAAAAE3Y/STUPRmAkkKw/s1600-h/ExistingHomeSalesTurnover.jpg

    Shows that on a national basis that 5-7% annual turnover being about average over the “normal” years.

  80. grim says:

    Crazy to think that all that separates Bubble from Armageddon is 4-5 percentage points worth of housing stock turnover.

  81. Juice Box says:

    Grim – Peak bubble builders were selling over 120k new homes a month and now we are at 35k a month.

    http://research.stlouisfed.org/fred2/series/HSN1FNSA

    http://research.stlouisfed.org/fred2/series/HNFSEPUSSA

  82. Juice Box says:

    Anecdotal – but the bag holders friends and family have all said they will not sell for less than the price they would have gotten peak bubble. I know a few little old ladies in Ridgewood holding out for their 4 handle on the cape cod that hasn’t been updated since they moved in back in the 1970s. A cousin or two who have a second property by the beach that they continue to list, and relist with no showings at their asking prices.

    Those that bought during the bubble are going to tough it out and wait is what I still hear. Eventually some Millennial will come along and buy the place. Inflation raises all boats so get on board…

  83. Anon E. Moose says:

    Juice [83];

    Inflation raises all boats so get on board…

    Punched my ticket.

  84. 3B Buying says:

    #83 Juice: now if only we can get those Milennial’s some good paying jobs. As far as inflation lifting all boats. I am more inclined to think stagflation. And the old timers or their families that are selling the houses, are the worst. They have no problem milking a buyer for every dime and than some.

  85. 1987 Condo buyer says:

    #83, exactly (#12), say all those old ladies are 75 in Ridgewood and down the shore, you may have to wait 20 years for an estate sale for common sense pricing….also if mortgage is paid, the property tax is just “the rent”..my MIL pays $1850 a month rent for a 1 bedroom in ridgewood….that pays a lot of property tax!

  86. chicagofinance says:

    The End Is Nigh (Clot Nocturnal Emissions Edition):
    http://news.yahoo.com/why-does-social-security-174-000-bullets-070710918.html

  87. O hey there says:

    Hey guys, been a silent follower of this blog, I just went under contract for a home that had its foundation redone. Does anyone know of a inspector who is well versed in foundations? Any help will be appreciated

  88. chicagofinance says:

    DIAGNOSTIC TESTING

    In this section, we’ll outline a hypothetical decision-making problem, and
    discuss how and why various reactions to this problem may or may not
    indicate susceptibility to anchoring and adjustment bias.

    Anchoring and Adjustment Bias Test

    Scenario: Suppose you have decided to sell your house and downsize by
    acquiring a townhouse that you have been eyeing for several years. You
    do not feel extreme urgency in selling your house; but the associated
    taxes are eating into your monthly cash flow, and you want to unload the
    property as soon as possible. Your real estate agent, whom you have
    known for many years, prices your home at $900,000—you are shocked.

    You paid $250,000 for the home only 15 years ago, and the $900,000
    figure is almost too thrilling to believe. You place the house on the market
    and wait a few months, but you don’t receive any nibbles. One day,
    your real estate agent calls, suggesting that the two of you meet right
    away. When he arrives, he tells you that PharmaGrowth, a company that
    moved into town eight years ago in conjunction with its much-publicized
    initial public offering (IPO), has just declared Chapter 11 bankruptcy.
    Now, 7,500 people are out of work. Your agent has been in meetings all
    week with his colleagues, and together they estimate that local real estate
    prices have taken a hit of about 10 percent across the board. Your agent
    tells you that you must decide the price at which you want to list your
    home, based on this new information. You tell him that you will think it
    over and get back to him shortly.

    Question: Assume your house is at the mean in terms of quality and salability.
    What is your likeliest course of action?
    1. You decide to keep your home on the market for $900,000.
    2. You decide to lower your price by 5 percent, and ask $855,000.
    3. You decide to lower your price by 10 percent, and ask $810,000.
    4. You decide to lower your price to $800,000 because you want to
    be sure that you will get a bid on the house.

    Test Results Analysis
    A tendency toward either of the first two responses probably indicates
    susceptibility of the subject to anchoring and adjustment bias. Remember
    that real estate prices here have declined 10 percent. If the subject wants
    to sell his or her home, he or she clearly must lower the price by 10 percent.
    Resistance to an adequate adjustment in price can stem, however,
    from being anchored to the $900,000 figure. Anchoring bias impairs the
    subject’s ability to incorporate updated information. This behavior can
    have significant impact in the investment arena and should be counseled
    extensively.

  89. Juice Box says:

    re # 85 – 3B – don’t have the data by age but Bergen County is still hurting for jobs, the lazy Millennial kids only need to move to North Dakota according to the Republicans. Plenty of jobs there manning the rigs or serving coffee. I don’t think Mr. Magic Underwear or O man can fix that, so go long basement renovations for the kids who never move out.

    http://research.stlouisfed.org/fred2/series/NJBERG5URN

  90. Happy Renter says:

    [89] What – no option #5? “Raise the asking price to $917,900 because that will show the world that you have precisely and accurately determined the value of your home, and because it will set the stage for a ‘negotiated’ agreement-point of 900K with a buyer who is lucky enough to inherit your house and its 16K in annual property taxes.”

  91. 3B Buying says:

    #90 Juice: I don’t doubt BC is hurting for jobs. And lots of empty store fronts up and down KKR, probably in Westwood and Ridgewood too, or at elast there was. And again, I know it is a pet peeve of mine, but why is it so many people in the so called more affluent towns no longer do basic house maintenance? OK money is tight, but that means the garbage can sits in the street permanently? Or you cannot bend over and pick up the 10 old Newspapers in the drive way? Just saying.

  92. chicagofinance says:

    The End Is Nigh (Don’t Get It Edition):

    CHARLOTTE–On Tuesday, a group of more than 100 protesters shouting “Obama is a traitor” temporarily shut down official bus service that ferries around delegates at the Democratic National Convention. The protesters, some of whom were lying down in the street, were surrounded by Charlotte police, who used their bicycles to build a barrier around the group.

    “What do you think of free speech zones?” shouted one protester to the police and onlookers, referring to the cordoned off areas for activists. “Does that seem strange to you?” Protesters also shouted that accused Wikileaks source Bradley Manning should be freed. At one point, the protesters raised a tent above their heads and set it on the ground. “Bad news, guys, they’ve pitched a tent,” a police officer joked. “They might be here for the duration.”

    Delegates and convention-goers who were forced to wait for buses to be rerouted expressed surprise that the Occupy presence has been stronger at the DNC than the Republican convention in Tampa last week. “I didn’t see them at the Republican convention,” said Wandra Ashley-Williams, vice president of the Maryland State Conference NAACP. “That’s not good.”

  93. xolepa says:

    If anyone remembers, hooligans made a lot of trouble at the 1968 DNC, not at the RNC of the same year. History just repeating itself.

  94. Jill says:

    chifi #93: Everything old is new again. Sounds like it’s going to be Chicago 1968 once again. My guess is that Occupy has been pretty much taken over by the LaRouchies and anarchists…let the head busting begin. Looks like you’ll get your dream team of Willard the Rat Man/Eddie Munster after all. Woo-hoo.

  95. Jill says:

    xolepa: Great minds think alike.

  96. grim says:

    I just went under contract for a home that had its foundation redone. Does anyone know of a inspector who is well versed in foundations? Any help will be appreciated

    First thing, go to the town, get a copy of the permit details. Should give you more insight into what was done. “Redo” a foundation could mean anything from a repair to a complete reconstruction.

    No home inspector is going to tell you a damns worth of anything about a foundation other than what is visible. Ideally, what you want is a structural engineer. He’s going to want design details if it was altered. It’s probably going to cost you a couple of hundred bucks for a consultation/review. The reason I suggest the permit approach first is that the owner or contractor may have already hired one, and they may already have provided the town with any necessary details, and the construction officials may have already approved said design and construction.

    Also, find out why a foundation needed to be repaired. Foundations don’t generally fail unless they were designed very poorly, or the underlying soil conditions have an issue (shifting, sinking, sliding, etc). You’ll want to know the underlying cause, otherwise you might be rebuilding it again. Don’t want to cause any unnecessary concern here, but do your homework.

  97. Ben says:

    If the BOE won’t take no for an answer on the turf field, I wouldn’t be surprised if they are getting cash under the table from the people that stand to profit big time off the turf being installed.

  98. Juice Box says:

    re # 86 – Condo my mom had her taxes frozen in 2006 per the state program. She pays about 6k after rebate. Combined with utilities and maintenance it is still way cheaper than rent. I have been warning her to ignore the reverse mortgage hucksters and to turn away other people promising guaranteed returns. Another problem is the Roma Gypises and other scammers who prey on the elderly. Believe it or not they do operate in haughty Bergen County.

  99. xolepa says:

    (96) The RNC planned by having the entire block surrounded by buses. The Hippies and radicals couldn’t climb over them. As a result, they were ignored by the mass media.

  100. xolepa says:

    (99) JB is correct that seniors in NJ have their taxes frozen. the trick is you have to apply and then pay the taxes first. You get the money back later. Not exactly advertised widely. My mother (and her entire older-age association) is still paying under $3k for a 2br condo.

  101. Juice Box says:

    re: #92 – 3B – Cut the lawn? Surely you jest little Jimmy is too busy online getting the new world record in wasted hours on Halo to push a mower or take in the garbage. I cut my teeth starting at age 12 landscaping,paper routes, shoveling snow and odds and ends for the neighbors. I had a pretty good racket going for the surrounding 2-3 suburban blocks until I made it to the big time at 15 and got the ability to work part time legally.

  102. Ernest Money says:

    Bojangles wins, the Skimmer wins…no difference. It’s all going down in flames.

  103. yo says:

    #89 chi

    I will go with number 4.Key word is urgency to get rid ,property tax eating cash flow.Bought at $250k.I can assume if property tax is at $24000 a year that is $2,000 a month which will be equal to rent that would have been spent anyway if renting.The real investment is the mortgage. A mortgage of $250k assuming it is paid off in 15 years would have cost the homeowner $500K with principal and interest minus tax deduction.That still leaves him $300k minus commision.I will take this deal in a heart bit.

  104. prtraders says:

    Senior tax freeze has limitations.
    http://www.state.nj.us/treasury/taxation/ptr/firstyear.shtml
    We have a more than a few older clients. What a mess trying to help them navigate the PTR and going to the town tax collector for proof of payment.

  105. yo says:

    That still leaves him $300k minus commision –In profit–.I will take this deal in a heart bit.

  106. yo says:

    That is equal to 4% a year in profit for 15 years

  107. O hey there says:

    Thanks grim! Do you know any structural engineers?

  108. Happy Renter says:

    Harold and Kumar . . . and Barack!

    http://www.suntimes.com/news/roeper/14933818-452/harold-kumar-barack.html

    “Hey, this is Barack,” says the president. “Listen, I need to know if you’re on board.”

    Cue the music that sounds like it’s from “Deep Impact” or “Armageddon.”

    “I’m counting on you,” says Obama. “Everybody is. Just remember that I’m trusting you on this . . . ”

    We cut to John Cho’s Harold and Kal Penn’s Kumar, in character, sitting on a sofa, watching TV. Tons of junk food in front of them, but no bong, so I guess we’re supposed to pretend these guys aren’t high.

    Harold asks who was on the phone, and Kumar tells him it was the president. “Sweet,” says Harold, as if that happens every day. The two lovable morons laugh at the screen as we learn this is a promotion for the live stream of DNC events . . . .

    http://www.cbsnews.com/video/watch/?id=7420434n&part=ndn-cbsi&tag=api

  109. Ernest Money says:

    You gotta be high to buy the crap these collectivists are selling this week.

  110. yo says:

    YOUR TAX DOLLAR WORKING HARD

    Sex-change surgery for prison inmate granted by judge

    Lisa Bul / AP file

    Robert Kosilek sits in Bristol County Superior Court, in New Bedford, Mass., Jan. 15, 1993. Kosilek, now named Michelle, has since undergone hormone treatment for gender-identity disorder.

    By Kari Huus, NBC News

    A federal judge in Boston on Tuesday ordered the Massachusetts Department of Corrections to provide sex-change surgery to a transgender inmate serving life in prison for murder, ruling that failure to do so violated the prisoner’s Eighth Amendment right to adequate treatment.

    http://usnews.nbcnews.com/_news/2012/09/04/13660348-sex-change-surgery-for-prison-inmate-granted-by-judge?lite

  111. t c m says:

    I think all this slamming on the younger generation is a little over the top. This economy stinks; if they buy a house they would have to pay property taxes out the wazoo to fund the pensions and bene’s of the municipal workers- (who will be retired for more years than they worked); jobs are scarce; their hippie generation morally superior parents are piling on debt because no one wants to give anything up and couldn’t care less about how their own kids are going to manage.,

    The govt. bails out everyone who makes stupid, corrupt, irresponsible financial decisions from the guy who took out a liar loan, to the dope who forgot that there is more to the cost of a house than the teaser interest payment in year one, to the dummy who took out a home equity to furnish his McMansion and go to Disney, to the Wall Street Fraudsters who bets the house, lost, used tax payer money to stay afloat and pay themselves outsized bonuses, and then somehow convince everyone that although they’re the ones who caused all this, they’re the only one’s smart enough to fix it; to the Govt. who failed to prosecute the aforementioned and propped up Fannie and Freddie to disastrous results, to imbecile politicians who only care about the sucking us dry, the next election, and giant speaking fees.

    So for those of you who suggest this younger generation is just lazy – I say, could be. Or maybe they just don’t see the value in busting their a$$ in this society. Maybe they’re the smart ones.

    That’s my rant for the day.

  112. Superman says:

    I know that you’ve been waiting for me.

  113. The Original NJ ExPat says:

    [1] grim – The rise in Morris County contracts is easily explained. Since they don’t foreclose on houses in MC anymore all you have to do is put the minimum down and close and you can live there forever rent free. The occupiers of the house in which I grew up have been in default for 4 years. It’s a good deal.

  114. The Original NJ ExPat says:

    [112] tcm – I agree. I think younger people see no path to prosperity or opportunity so they’re content to twitter away their time. In addition, they’ve been brought up in an always be in debt, never save for anything world, so they have few role models to follow who know how to break those chains. Everything is a monthly payment (rent, utilities, internet, phone, student loans, credit cards, public transit passes, etc.). I doubt they have much interest in adding steep PITI payments to that tiresome mess of bills so I doubt they have much motivation to go down that path. If they can stay at home that’s a ton more money they’re not spending on rent, utilities, and food. My generation was lucky enough to be released into the early 80’s with serviceable educations, no debt and perhaps a 4 fold explosion in earnings over what we could make without our college degrees. I think mostly we avoided or tentatively approached debt because our parents warned us against it. Even so, I think most kids I knew quickly got into a couple thousand dollars of credit card debt within two years(as it was new to us!) and then fought to get that payed down having learned our lesson and began saving after that. Most probably bought a new car with a 3 year loan and you got your car paid off and paid off your credit card debt around the same time and then got smart and realized it was better to save and buy your stuff when you could afford it and stay out of the monthly debt payment trap. Then in your mid-20’s with a couple raises and promotions and new found maturity you found you could actually save some money toward a house or condo. I guess that world is gone.

    So for those of you who suggest this younger generation is just lazy – I say, could be. Or maybe they just don’t see the value in busting their a$$ in this society. Maybe they’re the smart ones.

  115. Ben says:

    For all the faults of the younger generation, the fact of the matter is, they have nothing to do with the causes of this current economic crisis. Baby boomers were caught up in a frenzy and many of them have pillaged their financial well being through real estate and stock market speculation. My opinion is, suck it up. Those who lost, salvage what you can and let your children take care of you instead of allowing policy makers to force your children to try fund your comfortable retirement.

  116. o hey there says:

    You guys are being harsh on the younger geeration. Im 27 and buying my first house in morris county. Ive been looking for 3 yrs. And yes i did stay home with the parentals because i refused to pay someone elses mortgage :)… doing so allowed me to save a substantial amount for a downpayment

  117. Jill says:

    #116 Ben: You are absolutely right that the young’uns aren’t at fault for this economic crisis. However, to brand it all the boomers’ fault is incorrect. There’s plenty of blame to go around — boomers who used the houses they bought for $80K as piggybanks for vacations, fancy cars, home theatres, and yes, college for their kids. Gen-Xers who wanted to drive BMWs they couldn’t afford and go clubbing every weekend. Gen-Yers who ran up credit card debt on Juicy Couture. It wasn’t easy bucking the spend-spend-spend-borrow mentality. I’m a boomer who did, though. I waited to buy a house until I was 40 — and bought at the bottom of the market, then refinanced away the PMI two years later. I’ve updated my house as I could accumulate cash instead of taking home equity loans. I didn’t charge more than I could pay off in 2-3 months, thereby building a credit score of over 800.

    As far as “stock market speculation” is concerned, please explain how that differs from what Republicans want to do in terms of creating “private investment accounts”. ALL stock market “investment” is speculation.

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