Why does the corrupt Real Estate Industrial Complex feel so compelled to shout "nothing's the matter - move along - nothing to see - everything is well"
When you hear stuff like this, all is not well. As a matter of fact, it's PANIC TIME!!!! OK, there was a bit of glee there. But it's really the glee of showing everyone what that corrupt Real Estate Industrial Complex is all about. They're liars, they're cheats and they should be thrown in jail - every last one of 'em.
U.S. mortgage finance company Freddie Mac said on Tuesday that rising interest rates would lead to a slowdown in the U.S housing market but added it did not expect the market to crash.
"Rising interest rates will lead to a slowdown in the U.S. housing market," said Chief Executive Richard Syron, speaking to Reuters in Paris where he was on a business engagement.
"What we're ultimately driven by is mortgage debt outstanding. That's the total amount of mortgages which are generated in any year in dollars in the United States. That grew a little close to 13 percent last year. We think ... the rate of growth this year will be substantially less, it will be in the 8-10 percent range, my own view is that it will be toward the low end of that," said Syron.
Stock markets around the world have tumbled in recent weeks on fears that interest rates may rise amid inflationary pressures.
Syron said, however, that the U.S. housing market was unlikely to crash, despite fears of the effect of higher rates.
"We do not think that there will be a crash. We think that by and large, overall, nationally, there will be a material slowing of the rate of appreciation of housing prices, but not an absolute decline," he said.
June 13, 2006
Freddie Mac sees no crash in housing market
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When I bought my first house on the North Shore of Long Island, NY for $243K in 1990, I did so at the incessant prodding of my wife. I thought that price was insane for an ordinary if quaint 4 BR colonial on ½ acre. Well, 13 years later, after about $200K of home improvements with an addition for my MIL (I must have been nuts) in 2001, I sold my home for $800K in August 2003. While that might be decent appreciation, I couldn't believe someone would pay that much for a home at the time. Now, that same place 3 years later is appraised for over $1 million. This is insanity - who can afford these prices? The taxes are up to $14K (from $6K in 1990) and the utilities (LIPA ripoff rates) run about $500 per month just for electric (the house has oil heat!)! Even if you put 20% down (how many folks do you know that have $200K in cash?) and get a fixed 30 yr mortgage at a decent 6.5%, your talking monthly carrying cost of about $6800 after-tax dollars per month, before food, heating oil, clothes, cars, and the sundry costs of living. Who can afford this? I left LI because as a homeowner I felt like a slave to the bankers, the local government and schools, and the utilities via your home-related expenses. I’m an MD and made double six figures and couldn't save anything substantial! In 2003, I put my foot down and told my wife: "we're outa' here!" I was working 50-plus hours a week and every dime went into the house! We were going nowhere financially, except of course for the overpriced money pit house!!
In late 2003, I bought a bigger, custom built, and much nicer, more energy efficient house on 10 acres in Bucks County, PA, cut my property taxes and utilities in half, and doubled my income. My mortgage payments are the same as in 1990 as I locked in at 5.5% which offset the increased mortgage principle - so now I own 2/3 of the house. Now, I can save for the future as I have ample surplus income, and I have a life. And, the teachers and schools are superior (to LI): even my wife, the perennial teacher supporter, admits that now.
LI is for suckers and fools. That market is absurdly overpriced and will crash badly. The Suffolk county teachers drive Beamers and Mercedes’ and complain about their pay. Fully half the county teachers are overpaid desk warmers who do not even teach – and only have to work 9 months out of the year! County cops start at $100K per year. LIPA rate payers pay the highest electric prices in the continental USA – in large part thanks to the Shoreham Nuclear Plant boondoggle scam of the late 1980’s. Property taxes are some of the highest in the county and go up 7-10% per year every damn year. If the homeowners don’t agree to these increases, the teachers threaten to cut the school buses first! Yeh, right: “it’s all about the children.”
Residential home prices on LI are excessive and not sustainable. Expecting 8-10% growth per year is a pipedream – who the hell can afford these money pits?
Location, location, location……my ass!!!
Good to hear that you got out of LI, Dr.
Just wait until the next hurricane rips the shit out of FL, NC, and then proceeds up to NY.
I've got an ominous feeling that FL will get HAMMERED by a Cat 5 hurricane this year. I really hope I'm wrong. Alberto didn't cause much damage but it brought a lot of wind and ripped the roofs off a couple motels. The Tampa Bay area is NOT prepared for any type of significant storm.
anon from StrongIsland. YOU are 1000000000000000000% correct about that sandbar dump. and I ditto all you said for Nueva Jersey. But growing up in Morris County, the only place I hated more than northern New Jersey, was Long Island. Nasty place.. both of them. Same deal in NJ, homes in my hometown, were 200-400k in the mid 80s with taxes of 3-5k/yr. Those same homes are 950k-1.6m with taxes of 14k-25k a year. Fuck that place fiercely.
I am also glad that you got out of Long Island doctor, but don't praise the PA education establishment by comparing it to LI. As a life long resident of PA
I can assure you that we get fed that "its all for the kids" bullsh*t with every unbelievable pay raise and tax increase. Try Jaguars, Lincolns, and Caddies. Whine, whine, whine, more money, more money, and more money. State auditors just found that one supervisor in our district took a vacation in Europe and double charged the taxpayers. Bad enough taking a junket on out taxpaying backs, but submitting bills for twice the expenses? Nothing wrong with that though, according to the useless school board, SINCE NOBODY SAID THEY COULDN'T!!!
I don't bear you any ill will for your profession, lifestyle, or income, doctor, but its people like you who are KILLING people like us. You move here with your big salaries, big dreams, and a LI idea of what housing costs, so of course we appear so much cheaper! Who wouldn't !?! You were paying 6k taxes in 90,so think that its great to pay the same amount here in 06 and don't mind paying it?? That amount would kill the average person I know in this area. It’s already starting to. School board puppets raised taxes 37% in two years so they can give their masters, the teaches union, a 20% raise, THIS YEAR ALONE! Sure, they will go thru the motions of 'negotiations’, but that’s just ear candy for the gullible! It’s already a done deal! The teachers already have received letters from the school board telling them how much raise they will be getting, before contract talks even start.
More and more Baltimore/DC professional types are starting to cast envious eyes northward to our neck of the woods here across the line in PA. That from an already transplanted executive who built down the road.
Pays 9k taxes a year for his unbelievably overpriced speck sh*tbox and brags about how he is living on easy street compared to DC where he was paying almost three times that for an old brownstone row home. According to him, that’s the prevailing mentality among a lot of execs he runs into in the course of daily business. Come on in/up to PA where it’s cheap to live. Well it won't be for long.
I personally hope for one final humongous dead cat bounce to the housing bubble so that I can find a
sucker......excuse me, I meant to say an enlightened buyer with ready cash who knows when a deal is to good to pass up. Hopefully to a nice executive and his family
who will be getting a fabulous deal, at least in their overpaying Baltimore/DC eyes, while making me very wealthy.
Sorry to rant on like this, and again, I'm glad you like it here. I USED to like it here. When you mentioned the education establishment and their damned taxes you hit an open raw nerve.
Exactly. Mr Morris County here... We had 'u know what's' moving in from LI, Essex/bergen cnty or Manhattan, thinking that 500k and 10k in property is 'deal. it is a shafting. I want 200k and 1500 in prop taxes. I was gonna move to Bucks Cnty in 2001, you'd get a 4bd with a barn on 5acs for 300k. now it is 600k with 6k tax. for what? for the same damn think. Life is not about paying a mortgage, big prop taxes, and sucking corp cock all day to pay it. Life is about having the house paid off, having humble low taxes, and play with the dog and kids in the yard. While don't all the scum on the eastern seaboard get it?
I'm the anonymous MD and to "stuck in so PA" I say sincerely: "I feel your pain!" Certainly, it wasn't my intent to ruin my neighborhood by driving up prices and happily paying my taxes. This house is the home I have dreamed of all my life: clean and quiet for my children, room to run for my dogs, safe and cloistered for my bride. OK, OK, I have spoiled myself this once. But, I am closing in on 50 and have been in delayed gratification mode since college/med school/residency. Heck, when you're in the mid 40's stilling paying off the last of your loans and still putting in insane hours, working holidays, weekends etc., don't you have a right to spoil yourself a little? I don't complain about my work demands: as Hyman Roth said "this is the life we chose." But my home is my only refuge - so please forgive that one vice. I gave up drinking and smoking for my wife and attend church almost regularly, am generous to the church, community and neighbors, take good care of my personal forest, and lead a quiet anonymous life. I support my hospital and community any way I can.
I am trying to carve out a sane niche in an insane world.
I hope you hook a big fish!!!
Anonymous said...
.... to "stuck in so PA"....
I hope you hook a big fish!!!
Thanks. Its even more enjoyable when the fish honestly feels that he's getting the better deal. And according to his wallet, HE IS!
Welcome to PA. Beware the education establishment though.
Their lock-down,almost total control state-wide over carefully cultivated spineless, weak-kneed,and gutless school boards WILL come back to haunt you
down the (property tax) road.
"Power corrupts. Absolute power corrupts absolutely"
AutoFX, I am buying more gold coins. Long term, insurance. I hope they are in my estate because I never needed to sell them to live.
I figure it is better to have gold (and/or silver) coins and wish you didn't than not have them and wish you did. There is a alalogous pilot's saying that it is better to be down here wishing you were up there than being up there wishing you were down here.
Times are getting risky. Greed may be replaced by fear and I prefer to hedge against the fear.
"Life is not about paying a mortgage, big prop taxes, and sucking corp cock all day to pay it. Life is about having the house paid off, having humble low taxes, and play with the dog and kids in the yard."
AMEN. Drop the kids part and that is me.
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