April 23, 2006

I'm baaaaacckk...

20 comments:

ecobuilder said...

There is no longer any doubt that Florida is ground zero of the bubble bust. The only debate is how quickly the mess spreads.

Condo Reversions
*****************
The South Florida Business Journal is reporting Condo conversions revert to rentals.

http://www.prudentbear.com/bearschat/bbs_read.asp?mid=388569&tid=388569&fid=1&start=1&sr=1&sb=1&snsa=A#M388569

Six communities with 1,571 units - three in Broward and three in Palm Beach County - have made the switch from condo conversion sales back to rentals.

Some are dubbing it "the great conversion reversion of 2006." It's a move to reposition rental communities, which were slated for condominium conversion sales, back to apartment rentals.

"It's an early-stage trend that will probably accelerate as the market slows even more," said Jack McCabe, CEO of McCabe Research & Development in Deerfield Beach.

I was out with a client yesterday and noticed a rental sign up on one of our largest condo conversions in Martin County. The converters have failed at selling the condos, so they have decided to revert back to apartments. A year ago they tried selling the condos starting at $249,000. Lately they have been offering them as low as $185,000 . . . and still no sales. By the way, there are more than 50 condo conversions in Orlando alone. The new catch phrase here is “condo reversions.” These guys are going to crumble, since rentals are off by as much as 50% with tens of thousands of flippers trying to rent homes they cannot sell. We no longer take any rentals from clients!

We have a lot of high rise ghost towns. It is only a matter of time before these developers and converters start defaulting on their loans and walking away. The banks are not going to be landlords. They will sell at auction for whatever they can get. Banks like Corus of Chicago have billion dollar exposures in Florida. Corus may have the largest exposure. Moreover, it is an exposure they cannot recover from once the developers start to fail.

By the way, if you're looking for a company to call about the condo market, the largest publicly traded builder of condos in Florida, is WCI. They not only have the largest exposure, but they are primarily in the runaway markets like Naples. Naples was rated as the most overvalued market in the United States with an overvaluation value of 82%. The other segment of WCI is general real estate sales through Prudential WCI and mortgages. They are batting 0 for 3 right now.

I realize the media is taking a hit for reporting on the negative issues, but you haven't even scraped the surface of what is going on here . . . statewide. The snowball effect will be horrible. More than 30% of the jobs created in Florida last year were in construction. We are now in a strong negative mode for construction jobs. As builders slow down and shut down, these guys are out of work. They are trying to relocate to New Orleans, but there is no place for them to live there. Talk about a Catch 22. I attended a luncheon yesterday where the president of the US Chamber of Commerce spoke. She owns a construction company in New Orleans. It was an eye opener and you could have heard a pin drop in a pile of hay as she spoke for 30 minutes.

Ludwig_von_miser said...

The change back to rental housing of converted condos, and the conversion to rental housing of units built as condos, may have a strong downward influence on the reported CPI, as housing is the largest factor in the index and "rent" is used to measure housing costs rather than costs of ownership or actual house prices. There might even be a danger of "deflation" which will require the Fed to speed up the printing presses to save us all from a fate worse than debt. We might even have to speed up the inflow of illegal aliens to fill up all those empty rental units. With the government owning many millions of rental units, how hard will it be for it to set rents and the direction of the CPI wherever it thinks they need to be?

Winston Smith said...

Why does the US take money from its own citizens and give that money to Israel, thus giving many people reason to hate the US as much as they hate Israel?

US politicians are more loyal to Israel than to their own citizens.

chris said...

Duh, Bush just hit 33% approval rating on FOX News so they use this same trick again another bogus tape...Bin Laden has probably been dead since 2003. Karl Rove; isn't this totally predictable to us by now?

Anonymous said...

Osama? Wrong war at the wrong time in the wrong place, right Keith??? You liberal wimps (Al Gore etc...) wouldn't even go after this dude. Willie let him go..but since he's your boy, he gets a pass right?

Anonymous said...

Why now? Becasue GWB has new chief of staff?

Anonymous said...

Osama blows up a building. George Bush blows up the country.

Anonymous said...

"You liberal wimps (Al Gore etc...) wouldn't even go after this dude. Willie let him go.."

Yo go girl. And since there ain't no statute of limitations on bashing ex-presidents - I say we start raggin on James Knox Polk for all the egregious stuff he pulled.

keith said...

isn't it time to raise the terror alert? we do have an election coming up and all

Anonymous said...

I wonder how many people know the strong family connection between the Bush family and the Bin Laden family.

It has always made me wonder if perhaps Osama has some dirt on Bush ( a brother bailed GW out of his failed oil venture)and this is why he has done so little to catch the 6 foot Moron.

Wasn't it the year before 9-11 that the Bush family spent Thanksgiving with the Bin Laden family?

Why was this family allowed to fly out of the US right after 9-11 when there was a no fly in effect?

Two failures from two different families. What are the odds of this?

Anonymous said...

My guess is he's dead. I want to see a video before I believe it's him.

He had kidney disease and you can't survive in a cave or mud hut. You need big and expensive dialysis machines in modern hospitals.

Anonymous said...

Given few hours of any person's speech, and a few hundred dollars to spend on digital audio editing software, you can make that person say anything you want.

One or few of the last tapes allegedly by Bin laden's voice, are fake. google for a minute and you'll get many URls, one is http://www.whatreallyhappened.com/
binladen_audio.html

From the sequence of the last few pictures of Bin Laden (from vidoes, stills, etc), it is obvious the man was sick and getting sicker. In his last video, he appeared close to death from his failed kidneys.

borkafatty said...

Must have found a way to recharge all that great video equipment in the cave..ya ok

keith said...

cave? he's sitting in the presidential mansion in iran, don't ya know?

Anonymous said...

I agree with the other posters, Bin Laden has been dead since at least 2003. Think about it, you can buy a video camera for a few hundred bucks with the date and time. I am getting tired of these "tapes".

Anonymous said...

Naaawww, it's the 4th memeber of ZZTOP.

borkafatty said...

Anonymous said...

Naaawww, it's the 4th memeber of ZZTOP.


LOL~! classic no doubt!

Anonymous said...

Recharging his video equipment in a cave....HILARIOUS!!! LOL!!
Now I can go to bed laughing:)

Anonymous said...

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