New thread for random chat. Post articles, tell me what I missed out there, pontificate and have a good chat
December 18, 2006
BUBBLETALK: December thread #2 to talk about the epic housing ponzi scheme
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Gigantic” housing bubble in the US could burst in 2008
Does South Africa and the rest of the world fair any better?
US property economist, Gary Shilling, predicts that the “gigantic” housing bubble in the US is likely to burst within the next year and half.
According to his analysis, published by SA consultants, Rode & Associates, Shilling reckoned it would take a 35% fall to bring house prices back in line with the CPI and a 40% plummet to re-establish the stable level of real quality-adjusted house prices that held in the previous post-second world war era.
keith and all,
new mortgage purchase applications released today showed another HUGE increase up 8.7%-
they are now at an 11 month HIGH- and have been increasing steadily-
Last week we were at 7 month high, now at 11 month high
gotta call the national picture as it is,, its not been deterioriating on average recently, the reverse is true...
Borks Bitch needs to layoff the Soy Products...story at 11.
Bloomberg News:
" Mortgage applications in the U.S. jumped last week to the highest level in more than a year as lower mortgage rates spurred home purchases and refinancing.
The Mortgage Bankers Association's index of applications to buy a home or refinance an existing loan rose 11.4 percent to 721.2, the highest since October 2005. The increase followed an 8.1 percent rise in the prior week"
Hey Bubbleheads, we're just gonna inflate our way out as usual...kinda obvious isnt it?
Also:
"Shilling reckoned it would take a 35% fall to bring house prices back in line with the CPI "
I reckon it will take at least a 25% drop for Schilling to ever be credible again...he's just another crackpot "economist", with an agenda.
I predict silver will rise and fall over the next ten years, now, I'm an economist too...
the truth is out there:
http://www.youtube.com/watch?v=GbPetrK_6Lc
Ok anonymous ill call your bluff, I was just going through the forclosure listings for my city, 80 properties were in some form of foreclosure last month, and several have refied.
Let me give you an example of a refied preforclosed property: I would link it but the registry of deeds does not work that way:
one example out of 20 with the same refied option.
Ajustable rate & Ballon Rider
FIRST MORTGAGE $204,000
Interest rate 7.5 change date january of 09:
LIBOR + 5.4% The note holder will then determine the rate of the unpaid balance that i am expected to pay at the full change date 50 years after the date of the note.
lIMITS: NOT GREATER THAN 10.5% OR LESS THAN 7.5% - 1.0 Increase or Decrease on a single change date 6 months. My interest rate will never be greater than 13.5 nor less than 7.5%.
Secondary mortgage of $52,000
BALLOON RIDER
Before they refied to this abortion they had a 30 year fixed with a $35000 second, and now they are into the mortgage above..thinking that this is going to save their skin and their house...give me a fucking break...they are screwed..and this is one example thre are 20 more like it...dont sit here and tell me that their is a refi boom going on cause it is total bullshit. TOXIC TO TOXIC and that is all it is.
So take your cut and paste MSM report and wipe your ass with it.
Its called a money shuffle and more time for the bank...if they could not afford it in the first place why in gods name did the bank put them in an even more toxic loan give them caah back and prolonged their pain to and even worse situation!!!!!EXPLAIN THIS!!!!!!!! so even i can understand..refi boom may ass..more like TOXIC WASTE DUMP!!
hi borkafatty,,
Im a different anon- i hear what youre saying
but, to be fair you gota note that NEW purchase mortgage apps are now at 11 month high- which is different then refi's
also the preforeclosure rate nationwide (perhaps youre in one of the worst areas) is about .42%, this is a fact not anecdotal- thats .42% NOT 42% as many here would think,, so even if this number goes up 5x thats a small percent of market,, (and foreclosures avg sale is about 85% of retail comp price)- so this wont crash things as many think
so new mortgage apps for PURCHASES at 11 month high nationally,, and the EXISTING NEW HOUSING STARTS TO SALES RATIO AT ALL TIME LOW - at lowest point since records taken (source motley fool website)
so with rising apps , and new housing starts drtamatically lower , the supply demand picture doesnt show current deterioration, just the opposite perhaps if you look at the national picture objectively...
all i know is:
$ 899,000 < $ 1,125,000
the higher number above being the asking price for a cute new home in vienna virgina six months ago.
the lower number being the asking price today.
and the seller calls that a "christmas special", lol, like he feels like he is giving it away.
i will wait on the fourth of july special thank you.
I figured out why all the bubble bloggers kiss txchick57's a$$ all the time. She sends them money. The 'net is rife with comments like: you really nailed it txchick57 and I totally agree txchick57. It's nauseating. (throws up). The world is full of brown nosers, I shouldn't be surprised. Then, she has the audacity to come over here and tell everyone not to leave comments over at Casey's blog, and the next thing you know, she's over there leaving comments her own damn self. Hypocritical buttwipe!
Oh, and I should add, pathetic too.
She also encouraged Casey to kill himself. Nice.
The insanity continues.
Is that all?
I HATE YOU ANON'S!
refi activity has nothing to do with home prices or home sales idiot
people are doing refi to stave off foreclosure and also suck more cash out of their homes to pay their credit card bills
HAH
whos the idiot-- look in a mirror and read the posts LOL LOL
applications for NEW yes NEW home purchases up 8.7 % and the NEW purchase home index at 11 month HIGH
the index is broken down between new purchase and refi,, the refi index up even more,, but thats not so relevant (except that low rates on the long end have helped many get out of arms if need be)
The mortgage apps for NEW purchases which is at 11 month high has a LOT to do with home sales (leading indicator).. espoecially when new new housing starts to existing home sales ratio is now at lowest level since records kept (40 yrs or so- source motley fool)
Once again bias led you to filter out facts,, dont be so fast to call others idiots unitl you know the statisitcs involved. thanks
You guys are right, you should go right out and buy a new home like everyone else cause it will only go up. I'll buy it from you in a year and a half. bwahahahahahahahaaahahahahahah!
no one said that, you are overgeneralizing- ther are undervalued or overvalued houses in any market- its never wise to buy "anything" without doing homework
Its simply to pint out that you cant let bias get in the way of facts that nationally the supply and demand numbers have not been deteriorating lately, but perhaps the opposite
this is simply a fact, I would be the first to note that the opposite was happening earlier in the year,, now the current stats are different
If you attack someone for that you have an agaenda or bias
like putting words in someones mouth--
you cnat simply buy "anything" and expect it to go up
BUT you are not ureasonable if you think that ALL housing (the country is bigger then fl az and ca) is simply going to deteriorate from here if you look at the change in supply and demand numbers that underlied weakness earlier this year
the stats and numbers go both ways,, end of story...
Pulte is up 26%, DR horton is up 35% since July. Must be a lot of idiot investor out there huh?
The mortgage industry is still handing out toxic loans to people who otherwise would not qualify for a mortgage in the first place...and are pushing ajustable rate mortgages out the door like like it is going out of style..as i said above they are not fixing the problem they are prolonging the Inevitable.
Anonymous you are entitled to your opinion, and i am sure your desk is full of applications from FB's just looking to get out from under a toxic loan and into another toxic loan...but it is not right.
But as long as your commision is paid and you have a job, life is good right, and screw the stupid people. That i kind of agree with you if you are stupid enough to put your John Hancock on a toxic loan you deserve your fate.
Just do us or me a favor dont make the situation look glorified cause it is not it is fucked!! and you know the people who take out these loans are fucked in the long run.. and you know it.
bork,
You need to stop lumping in ARMs, options, interest onlys etc together. ARMs are not toxic loans.
Do you know anyone who has lived in the same house for 30 years? I don't. Do you know anyone who intends to live in the same home - let alone the same city - for the next 30 years? I don't. You do know that on average people only live in a home for 7 years before moving, right?
So why in the world would a mortgage broker selling 30 year fixed at 7% be the good guy and the broker selling a 7 year fixed at 6.25% be that bad guy?
But sir values have gone through the roof! and price drops are happening all around the country, which means people will stay longer in their current residence because:
1. They can not sell their existing house.
2. they cannot afford another house
3. Their credit is mucked due to the arm increasing their monthly payment to which lates have occured.
It is not an oxymoron to see what is going on here.
I am not saying arms are a bad thing..are they good for the Affluent who do move from house to house every 7 or so years ...yes!
But not good for the average joe making $45,000 a year who wants the white picket fence and to settle down for the next 30 years..So why not just offer the 30 year fixed to the average joe and let him or her be stable in knowing that the payment is fixed for 30 years.
I dont get it..but please enlighten me if you would
borkafatty,
im not a mortgage person or realtor-- so stop being angry,, i have no agenda, do you?
the preforeclosure rate is under 1/2 of 1 percent,, so talk numbers and fact not anecdotes and anger please
again im not even in the real estate business(i do own real estate thats about it) and im just presenting some ideas you may not have thought about
so whats with the anger
Ive used full doc, and less doc loand myself,, both fixed and arms for my own purchases over many years and can assure you am not undercaptitalized or in any trouble whsoever, with a very high credit score, and there are many like me who dont need to be babied by regulations.. why does that make you mad
we all feel bad for the uneducated borrower just like the uneducated buyer in the internet stock buubble,, does that mean we shouldnt allow people to buy tech stocks or ARMS if they are responsible,, lighten up, stop the hating
I dont know maybe i am just to conservtive to understand why one would not want to be secure IE: 30 YEAR FIXED, as oppose to not being secure...IE ARM!
I dont get it
Homebuilder stock values have nothing to do with home prices
Builders will continue to make money during the downfall, and they have significant pricing power
Say they build a home for $150,000, to sell for $250,000. Things go south, they can cut all the way down to $150,000 no sweat.
A person who bought a house from them at $250,000 has no wiggle room.
so whats with the anger
--------
If my words present anger I apologize...I am not angry I am frustrated..And do feel for these stupid Borrowers.
And to let you know anon Foreclosures in my state are through the roof. And through my research it is all toxic loans. ALL!!
borkafatty,
I simply dont believe in people being babied in their financial decisions and going to the least choices to protect the people among us who get into crazy situations
I think on important decisions people should take self responsibility and not just take the word of some realtor or mortgage guy without doing some homework
you would rather regulate people out of choices... so for example if i guy was going to be able to pay off a house in whole for example in 5 years , why shouldnt he be able to get in arm at a cheaper rate if the yield curve wasnt so flat
why shouldnt a person on a fixed income with 40,000 in earnings but 1,000,000 or more in investments over the years be able to qualify for a new home that he could pay cash for when it makes sense to liquidate investments tax wise etc
of course these are not the "toxic" examples but if you overregualte you take away choices for these types of folks and they are punished cause of people who were NOT responsible borrowers
thats not fair to me, thats all-
thanks
i have no agenda, do you
---------------
Yes i do.. my agenda is getting to the bottom of it all, once and for all, and to say what isnt being said..these loans are fucking up this country, as well as the people who signed for them.
40,000 in earnings but 1,000,000 or more in investments
---------
This is not your average Middleclass person ..lets be real.
But i hear you the debate goes on as well as the Fucked Borrower.
Borkafatty,,
I DO definitely hear what you are saying about your state,, there are prime examples of this in CA AZ and FL for example- where there was the 40k a year millionaire syndrome ,,and people felt the need to flaunt their "status" by buying flashy cars and homes they couldnt afford cause they go "up" forever they thought
I know exactly what you mean
I just want to point out that all im saying is that why should other more responsible people be regulated cause of these foolish yahoo's-
if the natl pre foreclosure rate is less then 1/2 percent nationwide,, then oviously ther were a HUGE amount of uninformed people with no reserves buying more then they could afford in your state, I agree 100%
but i dont think the rest of us should be punished for their foolishness ,, thats all
no hard feelings, iot sounds like you are a caring person in the midst of "bubbletown",, which isnt where I live
and the 40,000 income 1,000,00 in investments
there ARE many retired teachers etc like this- they were from the saving generation, and probably opposite in saving/spending patterns then the bubble area you live in
you may want to read the book "millionaire Next Door" which studied this- the professors who wrote this were suprised by these types of people too
there are others of course with less income but inherited money,, thats the same sort of boat--
we agree on more then you think, really
Increased mortgage activity a sure sign of PANIC!!! Unfortunately, most of these applicants probably don't make enough money to qualify for the new tougher lending standards. Probably they don't have the cash funds needed to pay down the debt to meet the loan to value ratio.
These people should just take there losses and get out of Dodge.
you cant be talking about the NEW purchase mortgage applications at 11 month high-
you think most people buying a home outside your little corner of the country are all irrational and have no money
and that renters are where the wealth of the country resides only
you cant even see through your own bias and look at facts as they are..
Jeez where to begin?
1. Why this fascination with someone making $45K? Is that your income or something and you assume everyone in the world acts as you do? I make $120K a year, do I have the right to get an ARM since I am "afluent"? God man you sound like the typical liberal democrat class warrior who thinks anyone making 6 figures is living the Donald Trump lifestyle.
2. 7 years is the average of all home owners. Since 95% of all people in the US make less than $100K a year, the non-afluent fall into this category. In the past 10 years I have moved 4 times. My parents have moved twice. My sister has moved 3 times. Befor marrying me, my wife moved 3 times. In today's world, 7 years in one job, one city or one house is the equivalent of 30 years a generation ago. We're not in 1961 anymore where you graduated from college joined IBM and spent 40 years with them in the same office building.
3. The market is cyclical. It went up, now it's going down and it will go back up again. Pick any 7 year period and you'll probably have some market somewhere going up 10% while another market is down 10%. This is absolutely irrelevant to the discussion of ARMs vs 30 year mortgages.
4. An ARM adusting upwards 1% is not going to kill anyone's credit. On a $250,000 loan that is an extra $200-300 a month. This means a few less $5 lattes at Starbucks and cutting back on the amount of $80 PS3 games Jr. gets each month. Put things into some perspective huh?
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BORK said...
But sir values have gone through the roof! and price drops are happening all around the country, which means people will stay longer in their current residence because:
1. They can not sell their existing house.
2. they cannot afford another house
3. Their credit is mucked due to the arm increasing their monthly payment to which lates have occured.
It is not an oxymoron to see what is going on here.
I am not saying arms are a bad thing..are they good for the Affluent who do move from house to house every 7 or so years ...yes!
But not good for the average joe making $45,000 a year who wants the white picket fence and to settle down for the next 30 years..So why not just offer the 30 year fixed to the average joe and let him or her be stable in knowing that the payment is fixed for 30 years.
I dont get it..but please enlighten me if you would
Wouls someone please go wake Casey up and tell him to update? Either that or the "Loan Officers" have "Collected"
Actually, coldwellbanker.com has some interesting articles and stuff that show it might be a good year to buy next year. Check it out and decide for yourself.
Was reading about Tokyo's bubble back in 1989 and since people here love to compare the current bubble to Japan, here is a quote I read to give HPers some food for thought:
"Prices were highest in Tokyo's Ginza district in 1989, with some fetching over US$1.5 million per square meter ($139,000 per square foot), and only slightly less in other areas of Tokyo. By 2004, prime "A" property in Tokyo's financial districts were less than 1/100th of their peak, and Tokyo's residential homes were 1/10th of their peak, but still managed to be listed as the most expensive real estate in the world. Some US$20 trillion (1999 dollars) was wiped out with the combined collapse of the real estate market and the Tokyo stock market.
Adjusted for inflation that would be $216, 633 per sq ft.
This on top of their Stock bubble. The article said that Japan lost some 20 trillion in real estate as a result of that bubble pop.
How does that compare with the USA where I imagine nationwide the average home costs around $100 a sq ft except in some bubble areas where $200-400 is high and those extreme markets where maybe $1,000 a sq ft?
Not to mention the ignored posts about the current price appreciation in Europe, South Africa, Australia and NZ where their home prices have risen even higher-recall those posts where in 10 years prices rose on average 100% or 10% a year here and in some places like South Africa over 300% or Ireland and Britain some 200%.
What do we think is a reasonable price? Does the market dictate that or do buyers? Is it the cost to build or replace? Is it just a buy/rent ration only?
Economist Mag Dec 9th issue, Bubble and squeak, says home prices rising again overseas, and that doesn't take currency values into account so in dollar terms the rise plus the devalued dollar makes our houses even less expensive.
New list for 2006 to 3Q, Demark up 23.3%, Ireland up 14.2%, Canada up 12.8%, South Africa up 12.7%, France up 12.5%, Belgium up 11.8%, Spain up 10.8%, New Zealand up 9.6%, Australia up 9.6%, Britain up 9.6%, the list goes on and does recognize that in those same markets some areas were flat, while others continue to rise.
It notes that in Australia prices rose rapidly in 2003, fell in late 2004/2005 and are no increasing with perth up 46% this year in the third quarter.
Looking at the price rise between 1997-2006, South africa up 327%, Ireland up 252%, Britain up 192%, Spain up 173%, Australia up 132%, France up 127%, Sweden up 123%, Belgium up 118%, Denmark up 115%, the USA up 100%.
Look at those numbers. Consider the rise in those countries and of course in Euros or pound sterling imagine the cost in dollars!
Think the US market doesn't have room to continue this madness? Barring WWIII I imagine as in Australia and New Zealand, both slowed, saw declines in their most expensive markets while the less expensive areas (like Perth) caught up, and then everyone starts rising again. The California syndrome here in the USA, our market always follows California, they export their ridiculous prices until they restore historic differences in price between them and the rest of us and then the march starts all over again.
Why is it so difficult for so many to comment on the trends outside the US and what it may mean here? Or the price of real estate in 1989 in Japan adjusted for inflation in downtown Tokyo for $266,000 a sq ft and try to compare to prices say in Times Square? People love to use bubble and meltdown but saying your neighbor is an idiot and filed BK doesn't mean that the whole world has. Facts please, adjusted for inflation, compare apples with apples, and facts with facts.
To the REAL KEITH, why do you continue to not screen your posters and approve their posts? The FAKE KEITH is trying to ruin your reputation! He has even stolen your puppet...or is he your puppet?
At least now I'm clued in on how to detect the fake...not so good yet on the fake Honica.
Thank you Kilobar. Some interesting points. Why do you think they may be behind us instead of in front of us since their home valuations vs incomes are much more out of line with ours? Also, it is so true about how many children stay at home until they are married or even after.
Thanks Keith about exposing Richard, the fake Keith. It just dawned on me that who you were refering to, the Richard you asked to stop posting hundreds of articles, the one with eh Hydrocarbon Age graph in blue.
Why does he post as Keith? He also seems to have a hard-on for me to. Is he gay? Does he want to bend over for both of us? Is he upset no one checks his blog and yours is so successful?
mozo maz, the thread is down the list of new articles.
But Chapman doubts the trip will help the Fed to engineer a slow dollar slide.
"The Chinese are going to do what the Chinese want to do, not what we want them to do," he said. "I believe the Chinese are going to send Treasury Secretary Paulson and Fed Chairman Bernanke home packing, with little or nothing to show for the trip."
How severe will the coming dollar collapse be?
"People in the U.S. are going to be hit hard," Chapman warned. "In the severe recession we are entering now, Bush will argue that we have to form a North American Union to compete with the Euro."
"Creating the amero," Chapman explained, "will be presented to the American public as the administration' s solution for dollar recovery. In the process of creating the amero, the Bush administration just abandons the dollar."
__._,_.___
Analysts: Dollar collapse would result in 'amero'
Think deep recession likely regardless of Fed's actions
http://tinyurl. com/y95nvj
Prisonplanet. com | December 13, 2006
Jerome R. Corsi
Two analysts who have reconstructed money supply data after the Fed stopped publishing it argue a coming dollar collapse will set the stage for creating the amero as a North American currency to replace the dollar.
The reconstructed M3 data – the broadest measure of money – published on econometrician Gary Kuever's website, NowAndFutures. com , shows M3 increased at a rate of 11 percent in May, compared to 9 percent when the Federal Reserve quit publishing M3 data earlier this year.
"Interest rate 7.5 change date january of 09:"
so the possibility of the rate increase in 3 years caused foreclosure now? please send me some of the shit your smokin'
"Anonymous you are entitled to your opinion, and i am sure your desk is full of applications from FB's just looking to get out from under a toxic loan and into another toxic loan...but it is not right. "
yeah, um, a lot of people do tend to refi to a better loan when rates drop...maybe I should have pointed out that to you before your "world is coming to an end " paranoia kicked in.
"these loans are fucking up this country, as well as the people who signed for them."
So exactly when did these loans do this? they've been around for years...any facts there, bork?
The Daily Reckoning PRESENTS: It is an old wisdom that the scale of the
boom excesses essentially determines the severity of the following process
of economic and financial readjustment. But what will the coming
correction hold for the U.S. economy after the fall of the housing market?
Dr. Richebächer explores...
MONETARY ANARCHY
by Dr. Kurt Richebächer
The encouragement of mere consumption is no benefit to commerce because
the difficulty lies in supplying the means, not in stimulating the desire
for consumption; and production alone furnishes those means. Thus, it is
the aim of good government to stimulate production, of bad government to
encourage consumption.
- Jean-Baptiste Say, A Treatise on Political Economy, 1803
From discussing politics back to discussing economics. Just as before,
though, it remains a dialogue among the deaf. The great majority of
economists has its eyes stubbornly focused on apparently positive features
for the U.S. economy, like the sharp fall in the oil price, abundantly
available liquidity, tame inflation, low and falling interest rates and
strong profits.
A minority of economists, in contrast, keeps just as stubbornly stressing
that the economy's famous gross imbalances and structural distortions and
the associated debt explosion are inexorably undermining economic growth.
In this view, the ongoing housing downturn will finally abort U.S. growth
and drive the economy into recession, with major adverse spillover effects
on consumer borrowing and spending.
Generally, however, optimism distinctly prevails about the U.S. economy.
It is not the old buoyant optimism. Yet it is optimism in the sense that
some true malaise, like a crash in the asset markets and a recession, let
alone a deep and prolonged recession, are absolutely out of the question.
Thanks to its superior dynamism and flexibility, the U.S. economy has time
and again bounced back smartly from periodic downshifts, and so it will
again.
Let us start with the hard facts. For six, seven and more months, U.S.
economic data are overwhelmingly surprising on the downside, and moreover,
the surprises have been going from bad to worse. Real GDP has successively
fallen from 5.6% in the first quarter of 2006 to 2.5% in the second and
1.6% in the third.
That's bad enough, but what rescued the latter quarter from total disaster
was a rather quixotic statistical event. While auto firms slashed their
output, it soared in the real GDP account, owing to sharp price cuts on
gas guzzlers. In this way, falling vehicle output contributed fully 0.72
percentage points to third-quarter real GDP growth, after subtracting 0.31
percentage points. The price index for gross domestic purchases increased
2% in the third quarter, compared with an increase of 4% in the prior
quarter.
It is an old wisdom that the scale of the boom excesses essentially
determines the severity of the following process of economic and financial
readjustment. It has been comfortingly argued that the U.S. housing boom
of the last few years has been less fierce than prior booms, which all
ended without steep price declines.
Certainly, there are different possibilities of measurement. For us, the
most important, and also easiest, measure of excess is the associated
credit expansion. The use of credit in the wake of this housing bubble has
been simply bizarre, outpacing all past experiences by far. Over decades
until 2000, outstanding total mortgages accumulated to $4.8 trillion. In
the second quarter of 2006, they amounted to $9.3 trillion. Mortgage
growth over the last five years was almost equivalent to its growth over
the prior five decades.
The second highly important point to see is that this housing boom was the
first one in the United States to impact the economy at a vastly broader
scale than just the building activity. As private households, using the
rising house prices as collateral for mortgage equity withdrawals,
stampeded as never before into debt to finance additionally other kinds of
spending, the whole economy developed into an outright bubble economy.
New single-family homes and multifamily homes rose in 2005 from a trough
of fewer than 1.5 million units in recession year 2001 to a postwar high
of 2.2 million units. Over the same period, the constant quality price
index for new homes rose 30%, and the purchase-only price index of
existing homes published by the Office of Federal Housing Enterprise
Oversight (OFHEO) rose by 50%.
Boosting the net worth and the borrowing facilities of private households,
this drove consumer spending to persistent considerable excess over income
growth. In correlation, personal saving plummeted into negative territory,
unprecedented for an industrialized economy.
It was a boom that plainly went to extraordinary excess in various ways.
As a rule, this suggests a very severe aftermath of painful corrections.
The first effects of the housing bust have definitely been bigger and more
abrupt than most experts had expected. Yet hopes are riding high for a
benign adjustment. To quote Federal Reserve Vice Chairman Donald L. Kohn
from a recent speech: "The economy will grow at a moderate pace for a
while, somewhat below the rate of increase of its potential, and then
growth will begin to strengthen."
Among his comforting arguments were first, the overbuilding in 2004 and
2005 was small enough to be worked off over coming quarters; second, this
situation stands in sharp contrast to some past downturns in the housing
markets that followed actions by the Federal Reserve to tighten credit
conditions; third, as the inventory overhang in residential building and
automobiles are worked off, economic growth should pick up again.
Mr. Kohn does not even mention that through the cash-out refinancing boom,
this housing bubble had unprecedented spillover effects on the economy as
a whole. In 2005, private households raised $1,080 billion through
mortgages. Of this amount, they only spent $95.1 billion on higher
residential building. Spending on goods and services rose altogether by
$539.9 billion, against an increase in disposable income by $354.5
billion. In other words, about one-third of the increase in consumer
spending depended on mortgage borrowing.
Actually, it strikes us how promptly the change in the housing market has
impacted mortgage borrowing. It peaked in the third quarter of 2005 at
$1,225.9 billion at annual rate. Falling steadily, it was down to $819.6
billion in the second quarter of 2006. This sharp decline was, however, to
a small part offset by higher consumer credit.
Mr. Kohn stresses that monetary conditions remain quite supportive of
borrowing and spending. Clearly, interest rates are so low that they exert
zero restraint on borrowing. But more importantly, falling house prices no
longer remain supportive for such borrowing. Remarkably, the sharp decline
in new mortgage borrowing since the third quarter of last year has
occurred even though house prices were still rising, albeit at sharply
slowing rates. As the price climate is sure to deteriorate for some time
to come, it seems a reasonable assumption that this initial sharp slowdown
in mortgage borrowing has some way to go yet.
While this suggests further sharp falls in house prices, this may well
take some time to materialize, because the housing market is notoriously
sluggish in its reactions. In contrast to financial markets, its initial
response to a change in the market situation is not in price, but on how
long unsold homes stay on the market until the prices are lowered to
realize desired sales. Sellers tend to resist downward price adjustments
as long as they can. Instead, the market becomes illiquid. For sure,
lenders will notice and adjust their lending conditions.
Mr. Kohn also takes comfort from the fact that the present housing
downturn, in sharp contrast to past ones, is not caused by credit
tightening. As he rightly stresses, "The Federal Reserve has returned
short-term interest rates only to more normal levels and long-term rates
are unusually low relative to those short-term rates." We think, though,
that he is drawing a totally false conclusion. All downturns caused by
tight money were followed by vigorous recoveries. A downturn happening
despite low interest rates and loose money seems to us the most worrying
kind.
Regards,
Dr. Kurt Richebächer
for The Daily Reckoning
Builders can sell it for $150K, sure. But they make $0 profit. Investors don't bid up stocks 30% in the hope that the company makes $0. When investors think a company will earn $0 profits stock prices fall 30% not gain 30%.
It amazes me how simplistic your thinking is. what is you do in London exactly? I sure hope it has nothing to do with finance.
---------------------------
---------------------------
keith said...
Homebuilder stock values have nothing to do with home prices
Builders will continue to make money during the downfall, and they have significant pricing power
Say they build a home for $150,000, to sell for $250,000. Things go south, they can cut all the way down to $150,000 no sweat.
A person who bought a house from them at $250,000 has no wiggle room.
California highest recorded number of foreclosures was first quarter 1996 with a total of 44,686 properties entering some stage of foreclosure.
With 16,000 properties in October, 2006 and 19,000 properties in November, 2006
entering some stage of foreclosure in California, chances are good that forth quarter 2006 will meet or beat first quarter 1996.
California will only need 9,686 properties to enter some stage of foreclosure in December 2006 to tie the highest recorded record.
http://biz.yahoo.com/prnews/061117/laf018.html?.v=72
http://biz.yahoo.com/prnews/061212/latu087.html?.v=74
Sovereign Bancorp Inc. (SOV) plans to eliminate several hundred jobs as part of a soon to be announced cost-cutting initiative, according to people familiar with the matter.
As part of the plan, Sovereign is shuttering at least three of its five wholesale mortgage-loan offices, effectively pulling out of the nationwide mortgage business, three people said.
Sovereign, which like other regional banks has been struggling amid a tough operating environment, has decided to close its wholesale-loan centers in Atlanta, Indianapolis and Concord, Calif., outside San Francisco.
http://www.marketwatch.com/news/story/
sovereign-cut-100s-jobs-
shut/story.aspx?guid=
%7B6C8476CC-DBD9-4D31-
AE63-F2FBA21DA428%7D
During the recent U.S. housing boom, mortgage lenders touted so-called exotic mortgages that allowed people to buy houses they could not otherwise afford. Now those lenders are bracing for the not-so-happy story of borrowers like Jesline Jean-Simon.
The Miami woman bought her two-bedroom condo a year ago on a 3 percent adjustable rate mortgage with flexible payments.
When home prices in the city were blasting off two years ago, Jean-Simon was sitting pretty.
But now prices have eased and she works three jobs just to manage a mortgage that has ballooned into interest rates of around 10 percent.
"I don't sleep much," the 35-year-old says about her round-the-clock work schedule. "But the first thing that I pay is my mortgage because I don't want my credit to go bad."
A mortgage survey due on Wednesday is expected to show that more and more Americans are in danger of losing their homes.
http://www.chinapost.com.tw
/news/archives/business
/20061213/97477.htm
The Mortgage Bankers Association (MBA) released their latest national delinquency survey today, which showed an increase in the delinquency rate for mortgage loans for one-to-four-unit residential properties. For the third quarter, the rate of delinquency for all loans outstanding was 4.67 percent, an increase from 4.39 percent in the second quarter and up from 4.44 percent when compared to third quarter 2005.
According to the survey, the rate hike was the cause of increases in delinquences for all major loan types, but mainly subprime and FHA loans.
"...Increases in delinquency rates were noticeably larger for subprime loans, particularly for subprime ARMs. This is not surprising given that subprime borrowers are more likely to be susceptible to the cumulative increase in rates we've experienced, and the slowing of home price appreciation has resulted," said Doug Duncan, chief economist and senior vice president of research and business development for the group.
The seasonally adjusted delinquency rate for subprime loans went from 11.70 percent in the previous quarter to 12.56 percent in third quarter 2006. And when compared to third quarter 2005, the third quarter 2006 delinquency rate spiked 180 basis points.
When giving meaning to the results, the MBA noted that they had no proof the increase in delinquencies had any correlation to non-traditional products.
http://www.dsnews.com/
view_story.cfm?id=681
Shilling also predicts two scenarios that can trigger the bubble burst:
The first calls for speculators to give up hope for appreciation, which for many is critical, since the rental income on their properties falls short of their mortgage, taxes, maintenance and other costs. As they dump their housing on the market, prices will nosedive, which will encourage other worried sellers to do the same and this then generates a nationwide rout.
The second price collapse-trigger, mortgage rate-reset shock, takes longer. Interest-only ARMs, accounting for 17% of all home mortgages in the first half, option ARMs, 9%, and ARMs with low initial rates, allow many to buy houses they otherwise can't afford. A survey by the US Census Bureau found that last year, 35% of Americans with mortgages spent 30% or more of household income on housing outlays while only 30% did so in 2003. Around 60% of sub-prime ARMs issued since 2004 have fixed interest rates for two years and float for 28 years thereafter. Their original rates in 2004 were 7,1% on average and, under their mortgage contracts, can eventually adjust up to 11,4% - about six percentage points over the current short-term benchmark of about 5,4% set by the London Interbank Offered Rate.
http://www.moneyweb.co.za
/property/520211.htm
Thanks Keith about exposing Richard, the fake Keith. It just dawned on me that who you were refering to, the Richard you asked to stop posting hundreds of articles, the one with eh Hydrocarbon Age graph in blue.
Why does he post as Keith? He also seems to have a hard-on for me to. Is he gay? Does he want to bend over for both of us? Is he upset no one checks his blog and yours is so successful?
Not sure what Richards problem is but apparently he is impotent so his mother says, why else would he get so hostile and tell other bloggers on Keith's site %$*% and not even use his real name but imitate Keith?
Economist Mag Dec 9th issue, Bubble and squeak, says home prices rising again overseas, and that doesn't take currency values into account so in dollar terms the rise plus the devalued dollar makes our houses even less expensive.
New list for 2006 to 3Q, Demark up 23.3%, Ireland up 14.2%, Canada up 12.8%, South Africa up 12.7%, France up 12.5%, Belgium up 11.8%, Spain up 10.8%, New Zealand up 9.6%, Australia up 9.6%, Britain up 9.6%, the list goes on and does recognize that in those same markets some areas were flat, while others continue to rise.
It notes that in Australia prices rose rapidly in 2003, fell in late 2004/2005 and are no increasing with perth up 46% this year in the third quarter.
Looking at the price rise between 1997-2006, South africa up 327%, Ireland up 252%, Britain up 192%, Spain up 173%, Australia up 132%, France up 127%, Sweden up 123%, Belgium up 118%, Denmark up 115%, the USA up 100%.
Look at those numbers. Consider the rise in those countries and of course in Euros or pound sterling imagine the cost in dollars!
Think the US market doesn't have room to continue this madness? Barring WWIII I imagine as in Australia and New Zealand, both slowed, saw declines in their most expensive markets while the less expensive areas (like Perth) caught up, and then everyone starts rising again. The California syndrome here in the USA, our market always follows California, they export their ridiculous prices until they restore historic differences in price between them and the rest of us and then the march starts all over again.
Why is it so difficult for so many to comment on the trends outside the US and what it may mean here? Or the price of real estate in 1989 in Japan adjusted for inflation in downtown Tokyo for $266,000 a sq ft and try to compare to prices say in Times Square? People love to use bubble and meltdown but saying your neighbor is an idiot and filed BK doesn't mean that the whole world has. Facts please, adjusted for inflation, compare apples with apples, and facts with facts.
Thank you Kilobar. Some interesting points. Why do you think they may be behind us instead of in front of us since their home valuations vs incomes are much more out of line with ours? Also, it is so true about how many children stay at home until they are married or even after.
OK HP faithful,
I'm 37. I have:
$15K in Credit Card Debt
(I'm a dumbass, don't ask)
$7K in car debt at 2% interest
$150 Condo debt. (30yr VA fixed@6.2%)
I'm expecting a $15K check (after all Taxes) by Dec 31.
What should I do with it?
Pay off Debt? If so witch one?
Invest?
If so, in US$ denominated assets or
Gold or other currency?
Or just say F*ck it and spend it in Vegas with my friends. No one takes this Blog seriously anyway ;-)
I'm told there is a net bank out there that will let you buy CD's denomiated in Non=US currancies. But I forgot. Help!
Signed, a Loyal HP Lurker.
Eh, what's up doc? It is vewy hard to give financial advice based on so little information. Please provide SS and banks account numbers.
37 year old
take your 15k and qualify for a $1 million no-doc loan.
Go buy a house, any house, as long as they'll give you $200,000 cash back at closing (they will)
Take the $200,000 and go to vegas. Put it on black. If black hits, sell your house, go back to renting and you'll be up around $150,000 for the week.
If red or green hit, live in your nice house as long as you can, then when the bank forecloses, go back to renting and declare bankruptcy
hope that helps
Good one!
Daily I search the mortgage fraud blog for news of my buddy Casey. Waiting...
Not really related to Housing but has anyone else come up with why Yahoo is closing the msg. boards Dec 19th and will at some point in the future come up with a new format where they claim no one will be able to dominate the posts?
The postings there have been filled with racism, porn, vulgar comments, etc...for years and yahoo did nothing.
Now with a trifecta of problems (war going badly, housing crash, and low Bush #s) they pull the boards. I'm not saying some thug that Karl Rove sent over went to the Yahoo corporate offices with "an offer they could not refuse". BUT....I do have my suspicions.
If someone reading this posting has the free time and will to open a webpage like newsboards.com or something like that with links to news that are updates a few times daily and a yahoo like discussion area for each story it can become a gold mine if it takes off.
Just have all users e-sign that they are over 18 so you are relieved of all liability as to content. In fact, make sure that you put in a disclaimer that says you enter at your own risk.
Have the messages in real time with a reccomend feature. Also...NEVER CENSOR anything. It can be the most vulgar and offensive thing you have read but let it stay up.
Yahoo AD space will become worthless as this month winds down. If you can launch this site before the 19th and advertise on the web in forums, msg boards, chat rooms, etc.....you might even strike it rich by selling AD space at a premium cost down the line.
Ha! The Realtwhores® got you good, Keith. Google "moron housing blog" and see who's at the top.
I live in Philadelphia -- and I just don't see it. I'd like to see housing prices fall. I'm not going to rush into buying because I think I'm going to be "priced out forever" in part because they're redoing the property taxes here where the people living in the city could go from paying 4000 a year in property taxes to 15000 a year. At that point you're basically renting from the state anyway.
But I just don't see it. I see a crash in CA and in AZ I'm not seeing one here.
Wish I were.
http://www.wsws. org/articles/ 2006/dec2006/ ineq-d12. shtml
US income figures show staggering rise in social inequality
By Jerry White
12 December 2006
A recent analysis of Internal Revenue Service tax data sheds further
light on the enormous gap that has grown between America's wealthy
elite and the masses of working people over the last quarter of a
century. The examination of IRS figures was conducted by the New York
Times and reported in its November 27 article, "'04 Income in U.S. Was
Below 2000 Level" by David Cay Johnston.
The article begins by noting that total US income in 2004—the latest
year for which tax information is available—was $7.044 trillion, down
from more than $7.143 trillion in 2000. The decline was attributed to
two factors: the stagnation of median household income—which fell by 3
percent, or about $1,600, between 2000 and 2004—and the fact that the
earnings of the richest Americans have not yet caught up with the peak
reached before the Internet bubble on Wall Street burst in 2000.
There is one element of the housing bubble / economic situation that no one seems to be talking about. Let's lead the way at Housing Panic. When the little price scare over gasoline popped up a few months ago, everybody whined for a while, and then calmed down with the prices. Has no one noticed that diesel fuel is now higher than premium and has not dropped back down? No matter what happens with the future bubble pop or economic collapse, I think this variable alone will end the <$100 a square foot for most of the country forever. After the excess inventory of spec homes has finally been diminished, new ones will inevitably be built. When diesel is $2.60 a gallon here in Texas, the land of Exxon and low prices, I shudder to think what it might cost to ship a bunch of lumber and bricks across a more expensive state. As fellow Austinite Foxwoodlief would say, "Let's be rational here, folks." Of course the spec home mania of Phoenix, Las Vegas, and other legendary bubble-blowers headed for a crash landing will make the news for a few years, but at the same time, prices of new homes in the desirable, but less bubblicious, markets will continue to increase. My humble opinion is that 2007-2012 could include some very bad years for some people in many areas, but after the dust has settled, most of us will look back on $100 a square foot as a fond memory.
Home builders have a lot of flexibility in lowering prices the way any business has flexibility. GM could sell a Tahoe at $10K instead of $30K if it wanted to just like DR Horton could sell a house for $150K instead of $250K. It doesn't mean the home will sell for $150K just like GM will never sell the Tahoe for $10K.
Just like GM will not turn a profit on a $10K tahoe, DRH will not turn a profit on a $150K home.
My point - which both you and Keith missed - about the stock price was that the 30% run up is an indication that investors think the home will sell for $250K and hence DRH will make a shitload of money in the near future.
Right now the homes are selling for $250K. If any investor thought that the homes would sell for $150K they would run away from the stock. What they are betting on is that the homes will sell abobe $250K.
A year ago investors thought that same home would be $300K by now. Well it turned out not be the case and DRH and the rest of the sector got smacked with a 50% loss in stock price. That is what happens when builder sell for less than expected. How in the world can you possibly now think that the $250K will sell for $150K and yet investors have bid up the share price by 30%. It makes absolutely no sense whatsoever...well except maybe in "the end of the wold is coming and I better sell all my dollars and buy gold" fantasyland that is prevelant here.
-----------------------------------
Kilobar said:
Keith's point, the one that went sailing over your head, is that homebuilders have a lot of flexibility in lowering prices and still being able to turn a profit. Hence, builders have downside flexibility whereas many homeowners don't.
Anonymous w/15k check coming:
You leave out very pertinent info:
Married? Children? child support?
job security? yearly income?
health? education? plans for next
year? do you normally save monthly?
PKK
chauncy,
I think the MOST important point that you arent saying and many are missing is that
the recent huge runup in homebuilder stocks was in the face of HUGE bearishness by retail (ie the people blogging here, for example)
in other words, there were MANY more retail sellers as "everyone" and every newspaper and magazine was screaming (and finally are afraid too as see how wrong this may be) - about the continuing housing "bubble" and crash
so this means that a MUCH SMALLER amount of buyers- larger institutional money was fading the larger amount of sellers calling for the continuing housing crash- and pushed up the homebuilder index in a big way
Its clear as a bell, these institutions are setting up for the NEXT imminent cycle of recovery in housing , cause they look forward, not backwards to last summers news
perhaps they see inventory decling, and the fact that new purchase mortgage apps have been steadily increasing to the point where they are at a 11 month high
and most importantly , the SMART money is noting that actual new housing starts/ existing sales ratio is at a HISTORIC LOW (you can look this up at motley fool website) so that inventory can reduce sharply nationwide from here if demand continues at current levels..
so you are not crazy , as many here think,, but fairly reasonable id say...
My parents thought I was crazy in the early 90s when I took my savings from a part time job while in HS and bought $14 Chrysler shares. I sold those shares before going to college at $51.
Everyone thought I was crazy in late 1999 when I sold all my stock options while everyone and their mother were convinced Dow 36K was on the horizon. About a year later the value was 3% of what I sold for.
People thought I was crazy when I bought 3 homes in Las Vegas 5 months after 9/11 when the hotels were still 1/2 empty and people were still afraid to fly.
So yea I've been called crazy a few times before. The more people call me crazy this time around, the more I know I'm right.
chanucy,,
yes, and they call me an idiot here too for suggesting that supply and demand is changing in this market nationwide since the bearish numbers earlier this year ( and keep overgeneralizing the worst areas in ca or az for example to say Im an idiot)
well im an idiot like you -- i have time to look at this board cause im a retired officer in institutional trading for many years who made his money looking at facts unemotionally in the face of bullish / bearish sentiment
and housing is no different
maybe if people listened to people who actually succeeded in the markets as well as anyone screaming anecdotes of the moment theyd be better off,, oh well
people just dont know who their true friends are,, theyd rather listen to negativity...
Chanucy, I find a lot of what you say refreshing. It is nice to see positive debate about fundamentals, costs, profits, inflation adjusted trends and a balanced perspectived on the issue.
A lot of HPers are like Christians, wishinig for Jesus to come back (or the bubble to pop 50% in the twinkling of an eye) and the reality is that the market is very complex and diverse.
I don't care if some idiot in California paid $500,000 for a cracker box and now it is worth $390,000, it has happened before, at least twice in my lifetime, and California and the nation survived. The dollar has gone down and people have cried the end of the world and the dollar survived and personally I like a devalued dollar as it forces Americans to buy fewer imports and makes our goods cheaper and helps stimulate trade (hopefully we haven't exported too many manufacturing jobs so that the weaker dollar won't matter).
I may want a $150,000 mansion in La Jolla but it ain't going to happen. If people with a Walmart mentality think that builders are going to sell consistently below cost or that they want Walmarts lowest price marketing then maybe China will start making prefab homes and shipping them to the USA for assembly.
That isn't to say costs can't go down. Less demand on commodities removes the price pressures that have caused many of those commodities, and the cost to build, to go up.
Of course one can build a $100,000 box in places like Texas or Phoenix on the fringes of metropolitan areas where land is plentiful and cheap but in Central cities? Costs, like rent, home prices will vary from location to location but traveling around the US it is hard to see costs for descent homes being less than $100 a sg ft average. I've seen some areas with $80 but way out away from most job centers so $80 in say San Angelo can't be compared with $100 in Austin.
And yes, I imagine mass builders like Horton can build for less than $100 a sq ft on the outskirts and and sell for $100 to make money.
Keep up the rational debate Chanucy.
Also Chanucy, what do you think of the latest Economist Magazine post about rising prices in Europe, South Africa, Australia? And the fact that their prices have doubled or tripled ours?
foxwood,
To be quite honest I stopped reading the Economist a long time ago. I just couldn't take the anti-American tone any more. I know this country isn't perfect but it's also not the cause of every problem in the world as the economist would have you believe. And yes I realize that I am a dumb, uneducated, unsophistiacted, redneck for daring to be patriotic.
That aside, I am not disputing that a housing slowdown is under way. Hell I sold 2 of my 3 homes last year because I knew this was going to happen. What I thought then and think now is that the prices will fall 5% nationally and 10-15% in areas like Las Vegas, Phoenix, Miami and San Diego where they went up 100% or more over the past 5 years.
But these projections of 40% drops of a second Great Depression, of an Amero, of a worthless dollar...is black helicopter stuff and cannot be taken seriously.
kilobar,
it tells me that SOME areas were overvalued, especially in areas like CA and AZ where homes were way out of whack with incomes, there was overspecualtion, and the percentage of wages used on housing were among the highest in the country..
this is no surprise
the point i try to add is that you cant overgeneralize this to the whole country,, its simply not the same everywhere and on AVERAGE the situation in supply /demand is getting better not worse at the moment nationwide...
chauncy,
id go a step further and say the declines youve talked about has already happened,, for the most part its old news in most areas- flat to up from here over the next year in most areas is the most probable outcome,, as hard as it is for most people to believe (and im talking most areas, not the worst case examples in ca etc)
time will show this is right,, when blogs of the day will be saying i cant believe it , housing was supposed to crash everywhere in 2007-
the "housing is crashing party" is last years play not next years, really folks you gotta look outsied of ca and az etc and look at the recent supply/demand #'s, including new pourchase mortgage apps at 11 month high, thats not deterioration, especially when the new housing starts to existing home sales ration is at historic low..
you gotta think without being influenced by the crowd to see the OVERALL picture, and not just look at san diego or phoenix-
You people kill me
here are some figures..no these are not sales theses are Forclosures:
Foreclosures by county during 60-day period ending Monday.
Worcester ... 589
Middlesex ... 554
Plymouth .... 447
Essex ....... 474
Suffolk ..... 433
Bristol ..... 345
Hampden ..... 328
Norfolk ..... 265
Barnstable ...149
Berkshire .....48
Dukes ........ 10
Franklin ..... 41
Hampshire .... 36
Nantucket ..... 4
Your right things are looking great...and these are overextended ARM borrowers. Mass is leading the way.
Boy the realtor trolls have invaded this blog bigtime...I feel like i am reading goverment script, with their
"Things are great and the bottom is here". Is that you David?
kilobar,
fair enough, we can respectfully disagree,
all Im saying is that demand now increasing /supply now decreasing
im no rah rah person either way,, i was bearish last year based on the reverse happening
Im not saying that areas which are most out of whack arent still vulnerable (ie ca is perfect example where prices way out of whack with incomes and no surprise most toxic loans there especially since californians culturally are flashy and max out on purchases to impress others)
Im just keeping a level head and seeing that supply is decreasing pretty fast in most areas (maybe not yours though) over the last couple of months, while demand is surprisingly high as indicated by new mortgage apps
and what is really surprising is that new home starts /exisitng sales ration is at the lowest point in around 40 years!!! so builders are cutting WAY back on new supply,,
and thats the sort of thing I look at
remember the REVERSE was true earlier in the year and i would be the first to say things look ugly then.. just am consistent when stats change thats all
yes and foreclosures will be a problem particulary in areas like CA where people were overstretched- but you gotta take into account that preforeclosure rate NATIONALYY is only about 1/2 %- my feeling is that the rates in CA for example could really skyrocket,, but that as a natioanl number it would have less effect then in other areas
and also , just an interesting stat- foreclosures generally sell for arond 85% of comp to non foreclosed properties- not 0% , so gotta say if even 6% of the homes go into foreclosure and sell at 15% discoutn, this not enought o crash whole natl market
hopefully , you can see im not rah rah phony realtor or something,, just an ex trader from chicago who looks at all markets this way..
nothing personal, i respect your view, and I just am looking at things a little differently on average nationwide...
NOt everyone who disagrees with the crowd here is some realor troll- thats just ridiculous,, you should actually read the posts and see that there are well thought out arguments on both sides of this issue..
you gotta have dissent for a discussion to be credible
all Im saying is that demand now increasing /supply now decreasing
HAHAHAHAH! But i do admire your enthusiasm for sure.
I have 7 houses within 2 blocks of me that have been on the market for 6 months..no takers...i beg to differ supply is not the problem it is demand.
List of homes sold in my neck of the woods - Las Vegas - this month. I found 2 homes sold for less than previous sale. 1 Owner paid $419K in '05 and sold for $410K, a 2% loss. The other sold for $440K and bought for $485K or a 9% loss. The rest are all positive.
Just as I have been saying...a 10-15% decline which will affect only those who bought last year. Anyone who bought in 2004 and before is doing just fine. Homes are still selling, buyers are still out there.
Not the end of the world folks.
And this is Las Vegas, bubble central up until last year when Phoenix overtook us to lead the way. If the worst that is happening here is a 9% loss for 5% of the sales, I think we're gonna be OK.
Parcel: 17725115006
Sale price: $440,000.00
Previous sale: 03/06 $485,000
Parcel: 17731114006
Sale price: $410,000.00
Previous sale: 08/05 $419,000
Parcel: 17721217006
Sale Price: $215,000.00
Previous sale: 02/04 $136,000
Parcel: 17703810011
Sale price: $278,000.00
Previous sale: 01/04 $165,000
Parcel: 17731516061
Sale Price: $450,000.00
Previous sale: 02/02 $246,000
Parcel: 17727611059
Sale Price: $270,000.00
Previous sale: 09/99 $123,000
Parcel: 17718216005
Sale Price: $562,250.00
Previous sale: none, brand new
Parcel: 17731112048
Sale Price: $315,000.00
Previous sale: 03/01 $168,000
Parcel: 17718215085
Sale Price: $466,800.00
previous sale: none, brand new
Parcel: 17721220265
Sale Price: $300,630.00
previous sale: none, brand new
Parcel: 17715315046
Sale Price: $300,000 Foreclosure
previous sale 08/06 $297,000
Parcel: 17714411017
Sale Price: $345,900.00
previous sale: none, brand new
Parcel: 17727311120
Sale Price: $240,000.00
Previous sale: 06/01 $114,000
Parcel: 17715210046
Sale Price: $325,000.00
Previous sale: 04/90 $96,000
Parcel 17711410148
Sale Price: $349,990.00
Previous sale: 03/99 $145,000
Parcel: 17715812019
Sale price: $394,900.00
Previous sale: 02/00 $180,000
Parcel: 17728517026
Sale price: $300,852.00
Previous sale: none, brand new
Parcel: Parcel: 17734511069
Sale price: $310,000.00
Previous sale: 05/03 $185,000
Parcel: 17734511069
Sale price: $278,000.00
Previous sale: 04/03 $168,000
kilobar,
I would agree 100%- its the sellers taking homes off the market for the most part ( and sales may actually increasing based on mortgage app stats)
but remember the buyers and sellers et the price, not you or me
the fact that they are taking the homes off market means in many cases they arent desperate like many here think, if they were so willing to sell and market was truly plummeting non stop the supply would still be increasing not decreasing i think..
and to the anon who laughed at "supply decreasing /demand increasing
well its true currently, im not so misinfoirmed, just an ex trader who looks at numbers without bias
earlier in the year- mortage apps were shrinking
and in the majority of metro areas supply was increasing
NOW the opposite is simply true in most areas nationwide (and were not talking simply anecdotes from florida)
google the numbers for youraself.. and the VAST majority of economists would agree,, mortgage apps for purchase at 11 month HIGH- and supply decreasing in MOST metro areas ,, and its much greater then 50% of areas
LOOK IT UP FOR YOURSELF- NEVER ASSUME A BULL OR BEAR CROWD (in this case is rght)
Im talking facts here,,,,
No more credit cards!
borkafatty,
it may be right that wher you live there is a demand problem at current prices,, not disagreeing
but im just trying to be consistent and look at national trends,, and nationally new mortgage apps at 11 month high for purchases- of course there may be a different story where you are, i dont disagree
but I cant listen to local anecdotes to override national trends , thats not the way i ever looked at things in any market
remember , some areas still seemed "hot " and things were selling fast just when the demand was starting to DECREASE late last year as evidenced by new mortgage apps for example-- at that time some could have said buy in florida or wherever cause things are selling fast
I wouldnt have listened to that anecdote,, would go with national trend and say housing is weakening fudamentally and this is a peak
NOW im doing just the opposite,, looking at national numberes at what may be a bottoming, and not listening to the same anecdotes in reverse ( ie nothings selling around me)
hopefully that seems a liltte reasonable to you ---
Chanucy, yes, the Economist often is a little left and always seems to imply that Britain is well, Britain! Superior! Love they way our home prices are a bubble but theirs are based on London being...different.
Still, like reading other views so the Eonomist is on the list with the NY Times or Al Jazeera or Arab Times.
Still, what I don't understand is why prices in Britain or Ireland or South Africa can be up 190-327% and no one talks about that and the fundamentals but prices up 100% in the US is the biggest bubble in history?
Or when commercial land was selling in downtown Tokyo in 1989 for $266,000 a sq ft in today's dollars that we are currently in the USA in a Bigger bubble? How does that add up? I'm not a commercial real estate expert but can't imagine premium land in NY city goes for more than $2,000 a sq ft?
I do believe in local bubbles and I do believe all bubbles affect us all, the RTC of the late 90s affected homes in Phoenix and homes were way undervalued in the mid-90s as a result and they the pendulum swung to the other extreme in 2005, all part of cycles.
I appreciate some of you moderate input on this site.
could these doggies fall 50% in value? cost? price? when one realizes that the banker who owns the house, and the borrower who owns? the house have both been borrowing? on the house
QUESTION - where have all the higher property tax dollars in California been going during the past few years. So much flipping, such higher prices and property taxes. Where are these tax dollars?
but the banker loans out ten for every one dollar he has!!!penis enlargement! what balls!!!
As recent as 1987, the United States was a creditor nation. We are now the largest debtor nation the world has ever seen," said Rogers.
"We owe the rest of the world over $13 trillion. And that's a terrifying thought. Our foreign debt is increasing at the rate of $1 trillion every 15 months,"
your house! your property! is worthless
As recent as 2004 the NE Patriots were in the super bowl. Then in 2005 they weren't.
Exactly, means nothing.
If anyone doubts the housing bubble is bursting just click on the Foreclosure button at the top to go to realtytrac and then search by state and your own zip code. While your at it take a look at 90210. Apparantly, the even the wealthy are having a problem.
Mortgage scam lands 5 'flippers' prison time
A federal judge admonished five men Wednesday for their greed in a multimillion dollar mortgage fraud scheme as he sentenced all to prison terms.
"The five of you have gotten yourself in big trouble," U.S. District Judge William H. Barbour Jr. said. "Generally, all of you have been doing well, acting responsibly, but you simply got greedy and now have to pay for it."
Supply? That's just people taking homes off the market, because they think the prices will be up again by next spring.
Mortgage apps?...seriously. Mortgage apps include all refi apps. There is no distinction. All the talking heads have been calling for everyone and anyone who has a ARM to refi, if they can...that is.
Do you have any numbers regarding how many of them are refis and how many are new purchases?
You're a sucker...
An article for all of you level headed
un emotional finance types from FMW.
You're welcome.
North American Union
Debut of the 'amero'
Pope John Paul II, Euro
By Judi McLeod
Thursday, December 14, 2006
The People's Republic of China, long lauded by America's enemies as the world's next economic power, will be the country that will force the creation of the `North American Union' (NAU).
Kofi Annan's former pointman, Canadian Maurice Strong, has been boasting from Chinese soil that China soon would be replacing America as economic king, using the jingo that's the official language at Turtle Bay.
The billions of dollars China has invested in the flagging American economy will be worthless. They will have to negotiate the exchange rate to the new amero. This will then force the creation of the North American Union.
The cloak of the NAU, fashioned in secrecy, will be thrown over an unsuspecting public, erasing the borders of three countries. Mexico, which already has legions of its citizens living and working inside America, is, in effect already inside the NAU. Their governments will inform the American and Canadian people that there is no option but the bread line.
Unfortunately, the plan, which has been in place for some time, now, has been all but ignored by the mainstream media.
One of the signs that the NAU is on its way is the collapse of the American greenback dollar paving the way for the debut of the 'amero'.
“Two analysts who have reconstructed money supply data after the Fed stopped publishing it argue a coming dollar collapse will set the stage for creating the amero as a North American currency to replace the dollar,” (WorldNetDaily, Dec. 13, 2006).
The euro followed the same blueprint of stealth and surprise. It was already issued as replacement currency before the masses could coalesce to fight it.
Who ever would have dreamed that the euro of a secular bureaucracy one day would be accepted for use at the Vatican? Pope John Paul II, who repeatedly condemned the “moral drift” of secular Brussels, sanctioned an official Euro for the Vatican.
In appearance, the Vatican coin looks very much like other Euro coins. But on the flip side of the coin, the image of Pope John Paul II faces left.
“By permitting his image on this new coin, John Paul II has given another symbolic and powerful stimulus to the European Union, which with the issuance of the Euro, is taking an important step towards the Universal Republic,” said Atila Sinke Guimarnes in Daily Catholic.
Was it all that long ago when people said the formation of the European Union was impossible? Today, the EU European holds 27 nations under its authority with other countries lined up for membership.
In the US, experts are now predicting that the collapse of the dollar is imminent.
“People in the U.S. are going to be hit hard,” says Bob Chapman publisher of The International Forecaster newsletter. “In the severe recession we are entering now, Bush will argue that we have to form a North American Union to compete with the Euro.”
“Creating the amero,” Chapman explained, “will be presented to the American public as the administration's solution for dollar recovery. In the process of creating the amero, the Bush administration just abandons the dollar.”
While the amero is being groomed to enter stage left, another phenomenon has been gathering steam outside of media headlines.
The North American Union, which got its start in secrecy, has been pulled out of the closet by a grass-roots effort, that will force it onto the agenda when Nancy Pelosi and Company open the 100th congress next month.
Pressed on by Conservative Caucus Chairman Howard Phillips; WND columnist and author Jerome Corsi; activist and American icon Phyllis Schlafly, leaders of the 50-member strong coalition are poised to halt any effort by the U.S. to enter into a North American Union with Mexico and Canada.
Members of Schlafly's Eagle Forum have been in training for the past two months to lobby on Capitol Hill when Congress convenes.
The resolution—sponsored by Republican Reps. Virgil Goode Jr. of Virginia, Tom Tancredo of Colorado, Walter Jones of North Carolina, and Ron Paul of Texas—expresses “the sense of Congress that the United States should not engage in the construction of a North American Free Trade Agreement (NAFTA) Superhighway System or enter into a North American Union (NAU) with Mexico or Canada.”
It's no idle boast when Phillips says, “this could be the most important project on which we've ever worked.”
Armed with the Internet release of about 1,000 documents, obtained in a Freedom of Information Act request to the Security ad Prosperity Partnership of North America, the coalition has the potential to embarrass the governments of all three countries.
According to Corsi, “the documents show the White House is engaging in collaborative relations with Mexico and Canada—outside the U.S. Constitution.
Very little about the NAU has been covered by the Canadian media.
The documents can be viewed here, on a special website set up by the Minuteman Project.
The stage has been carefully set and only intervention will stop North America from taking the same stealth route that Europe took in creating the European Union and its legal tender the Euro.
Articles on The North American Union
http://www.canadafreepress.com/2006/cover121406.htm
Jus' waitin' for Nucular 9/11 to by sum stocks.
"Anonymous said...
QUESTION - where have all the higher property tax dollars in California been going during the past few years. So much flipping, such higher prices and property taxes. Where are these tax dollars?"
Why, those dollars have gone to your city/county/state governments/school boards to dole out those much needed and so richly deserved fat pay raises and equally fat pension increases for your elected/appointed civil "servants"
and teacher's union members/education administrators.
It’s always a no win for the suffering taxpayer, and no lose for the pigs at the trough.
Even if you bought pre bubble, or own outright, its going to get plenty rough in the near future.
The only one's left standing, tax wise, will be expected to make up the difference for those who have fallen!
Of course all those "servants" with pay and pension increases guaranteed by state law, will be just fine.
Those of us who live and work in the real world, keep our noses to the grindstone, and haven't made bad financial decisions (whether by luck or education/experience) will get hammered just the same!
"So what if times are tough, why should we suffer?"
As I thought none of you commented on my post regarding sales in Las Vegas.
I posted the 20 most recent sales in Calrk County over the past couple of weeks. Of those 20, 2 were sold at below the previous price. That's 2 out of 20. Of those 2, one was at a 2% loss, the other was a 9% loss.
Remember just like your profits are meaningless until you sell, so are your losses. I'm sure a lot of people bought last year who now have a home worth 5-10% less on paper. But so what? Unless they sell today it is irrelevant.
Sorry folks, this is not the armagedon you're making it out to be.
and las vegas is a worst case area- youre a rare voice of reality here, chauncy
to whoever called me a sucker and said mortgage apps arent broken down between new purchase and refi
well your just another name caller here who doesnt know what hes talikng about-
they ARE broken down-
NEW PURCHASE mortgage apps up 8.7% if I recall ( google it yourself) this week, have been going up steadily and NEW purchase apps at highest level since january
REFIS were up more then that but thats not what I was focusing on
so once again ive been called idiot or sucker by one who doesnt do his homework-
man this is getting old....
kilobar,,
the big difference between the nasdaq internet bust and the housing n=market now is that it was incredibly Bullish sentiment before the bust (a classic top) -- and here its extremely bearish sentiment nationwide when in fact most are focusing on the most overpiced areas in relation to wages (ie califonia or az for example) and are ignoring the increasing demand (mortgage apps) and decreasing supply in most areas--
usually bearish sentiment in the face of more positive supply/demand indicates a bottoming not deterioration- again you gotta look past ca. and az or nv. to be objective i think
China will pursue currency flexibility and increased domestic consumption, while the United States will aim to increase national savings as part of joint efforts to reduce global imbalances, U.S. Treasury Secretary Henry Paulson said on Friday. He said in a statement that two days of high-level conversations with Chinese leaders in Beijing had been "very frank and productive".
Sounds like hollow words that can not be followed through by either China or the United States.
If it was that simple it would have been done long time ago.
United States will aim to increase national savings - saving penny and nickel that is.
According to calculations by the Mint, the metal value of pennies, which are made of copper-coated zinc, is now more than one cent. The metal value of 5-cent coins, made from a copper-nickel blend, is up to 7 cents.
Adding in the costs of manufacturing means the Mint now spends 1.73 cents for every penny and 8.74 cents for every nickel it makes.
Bankers Report More Mortgages Being Paid Late or Not at All, a trend that is expected to continue well into next year.
http://www.nytimes.com/
2006/12/14/business/
14mortgage.html?_r=
1&ref=business&oref=slogin
RE: saving not spending a penny..
It gets worse. Its now illegal to melt your pennies and nickels or to take more than $100 worth out of the country on pain of a $10,000 fine and upto 5 years in the pokey.
http://www.usatoday.com/money/2006-12-14-melting-ban-usat_x.htm
When I read of the increase in the real value of the penny and the nickel in September my thoughts immediately turned to my times in Italy, Greece, India in the 70s. Small change just disappeared from circulation. Bus fares, change in shops was rounded off using (wrapped) candy, stamps.. Its one of my abiding memories of being in a inflationary environment.
Now that story is out amongst the great unwashed, and since making it illegal actually validates the behavior, hording is inevitable and the onset of Third World style currency transactions start.
Its amazing how quickly things deteriorated. In September, only pre-1982 pennies were worth melting and I was idly planning a test of the free market / perfect information theory by comparing the ratio of pre and post 1982 pennies in my 2 years worth of loose change jar with the change coming my way in the subsequent month - in theory there should have been a distinct skew. Sadly, I didn't have the time to execute the utterly pointless exercise - and now its too late. the word is well and truly OUT !
-K
"Defaults, auctions and bank repossessions all trended higher in November, bringing the year-to-date foreclosure total to almost 1.2 million -- up 43 percent from the same 11-month period of 2005," said James J. Saccacio. "With home price appreciation slowing, and even declining in some areas of the country, homebuyers who stretched themselves financially to purchase a property don't have much equity to work with if they experience even a small bump in their mortgage rate or disruption in their income. However, the recent dip in interest rates, combined with relatively low unemployment in most areas of the country, should keep foreclosures from accelerating to the point where they impact the entire housing market."
Going to be more supply next year when more ARM reset.
Anyone wonder when demand will pick up?
Why never a mention of the NAFTA Superhighway and the North American Union (CFR). Our sovereignty is under attack, as is the entire middle class and the American way of life. Illegal migrants are merely one of the tools of the globalist elitopaths.
http://www.eagleforum.org/psr/2006/sept06/psrsept06.html
I disagree with Phyllis Schafly 95% of the time. But now all Patriots must stand together to take back America.
The NAFTA Superhigway- The North American Union...the Amero...new world order...police state...
It is here folks...
TREASON 101: ARIZONA STATE UNIVERSITY PROMOTES THE DESTRUCTION OF THE UNITED STATES OF AMERICA
Infowars.com | December 13, 2006
Bob Dacy
In May of 2005, a Council on Foreign Relations (CFR) task force released "Building a North American Community", a blueprint for merging the United States, Mexico and Canada into one country called "North America". The plan, which is being implemented via the Security and Prosperity Partnership agreement signed last year between the leaders of the three countries, will destroy the sovereignty of the USA. The United States will cease to exist as an independent nation. The United States Constitution , including the Bill of Rights, will be extinct. Implementation of such a plan is, therefore, by definition, an act of TREASON. No other word fits the crime.
Critical to the execution of this high crime is the careful application of propaganda. To that end, the academic community within the United States is being enlisted to sell the idea that destroying America is a good idea. On page 29 of "Building a North American Community" is a recommendation to "Develop a network of centers for North American studies.We recommend that the three governments open a competition and provide grants to universities in each of the three countries to promote courses, education, and research on North America."
Arizona State University is one of the first academic Judas to volunteer to sell out American sovereignty. Traitors at ASU have put up a website, intended to be an instructional tool to assist and encourage professors to teach the concept of "North America" to their unwitting student body. The site, appropriately titled "Building North America", was created in cooperation with the North American Center for Transborder Studies at ASU, which must, therefore, be the actual nest of the traitors residing at ASU.
The "About Us-who we are" page of the website lists The Americas Society-Council of the Americas as a partner, so ASU makes no attempt to hide the fact that David Rockefeller and his co-conspirators at the CFR are behind all of this. Mr. Rockefeller, in his 2002 book "Memoirs" on page 405 openly and boastfully admits that he is a traitor. "Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as "internationalists" and of conspiring with others around the world to build a more integrated global political and economic structure - one world , if you will. If that's the charge, I stand guilty, and am proud of it".
The "About us-Goals of This Site" page confesses the crime ASU intends to pull off, which is to "advance teaching and research on .North American integration". To that end, the website spawns five sections, to Wit:
Organizations and University based Centers: This page reveals the scope of the
crime. American University, Texas A&M University, University of California at San
Diego, and the University of Texas are involved. One of the many organizations
listed is North America's Super Corridor Coalition (NASCO), the very group that is
promoting the construction of the NAFTA Superhighway system, of which the Trans Texas Corridor is the first link - already under construction. That spider web of high priority corridors is intended to be the infrastructure which is a equirement for the union of the USA with Canada and Mexico. The North American development Bank also makes the list. That bank is slated to be the funding mechanism to allow American taxpayers to fund the building of the Mexican portion of the Trans Texas Corridor. Legislation has already been introduced in the United States Congress to authorize the treason.
Government Agencies: Lest one think the scope of this treason is only academic and economic, the North American Aerospace Defense Command, the Security and Prosperity Partnership of North America, www.spp.gov , and the US Department of Homeland Security all are on the extensive list of official, taxpayer funded agencies participating in the selling out of America.
Archive: This section provides university professors (traitors to be) with a
cornucopia of academic works to use as building blocks to form the course properly entitled TREASON 101. Included in this vast list of reading material is, of course, "Building a North American Community", the CFR blueprint for the entire caper.
Teaching Modules: This is the section where the arch-criminals spoon feed the
professors (dupes) into dumping self destructive propaganda on their eager students. The modules are divided into sub-groups by topic; monetary policy, governance and regulatory issues, and the border and transborder activities. Appropriately, the "Guide to Generating North American -Based Units for Your Syllabus" is named "The Matrix".
Syllabi: This section of the website, still under construction, is apparently
designed for lazy professors who desire to be bottle fed this poison. All they will
have to do is download a syllabus, and away they go to class, ready to teach the wonders of an elitist controlled North American Union.
One has to wonder if the professors that the globalists are conning into spreading the glory of driving a knife into the back of America have any concept of what they are doing. This author is of the opinion that most college professors live in an academic bubble insulating them from the real world consequences of their actions and of the implementation of their pie-in-the-sky socio-economic theories and beliefs. Most of them, trapped by their own inflated opinion of their intellect, sadly, do not have a clue. Perhaps these people at Arizona State University would not be duped into teaching TREASON 101 if they had a clue, if they were given a copy of The United States Constitution, including the Bill of Rights. Perhaps these professors need to be taught a lesson.in the rights and responsibilities of being an American.
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Whether you are a primary buyer, investor, or Realtor.We provide valuable information and superior match-making skills necessary to make your real estate experience more profitable and with less risk.
For Buyers:
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Not sure why you nuked this Keith but I'll try one more time:
FMW:
I also read your post on the Amero and found it both fascinating and frightening. It does seem like the globalist power brokers are indeed hell bent on a North American Union, similar to the EU. This would ultimately culminate with the dissolution of all borders and nationalism.
This could explain both Clinton and Bushie's softness on border issues and could be the REAL reason behind the current Republican defeat (not Iraq or anything else.) Think about it: the Republicans carry on for a while about reforming immigration (ha ha) and throw the Neo-Cons a bone concerning border security, building a fence, etc. but wind up doing nothing going into the election. The Dems take over and Bush pretends like it was a defeat but really he is laughing because he faked out all of the true conservatives and now he has a liberal congress which will support his mad plan of amnesty and a "guest" worker program which was the goal all along. The evil one-worlders (like Bush Sr., Bush Jr., the Clintons, John Kerry, Al Gore, Pelosi (richest person in congress by a mile), and many others) have a plan for consolidating their power and they just play a game of divide and conquer when really they're all on the same page.
It could be argued that there are some good reasons for trashing the currency (insolvent SS, Medi-Care, etc.) but really all true consolidation and solidification of power come from a deflationary depression. If you ask the right questions, you can come to the right conclusions. Here's a good question: During what period was the U.S. able to institute the largest number of huge government programs and create the first semblance of the new nanny-state? Answer: GD, 1930's. This was an extraordinary power grab and is similar to Bush's modern power grab but much more is coming.
Another good question: who gains and who loses in a hyper-inflation or a deflationary depression. In a deflationary depression, people with poor cash flow (borrowers and others with large debt) are hurt as asset prices fall and job losses mount. Hyper-inflation helps borrowers and hurts lenders, since the purchasing power of the loan payment falls and the borrower basically got that $500K house for pennies on the dollar and is laughing all the way to the bank as his income shoots up to $30K or $100K a month and he can pay off the loan in no time. You see, a hyper-inflation actually can result in a complete power-shift to people that had no real power before. Look at Weimar Germany and how the Nazi's bought up tons of real estate on credit just before the hyper-inflation broke out because they saw in advance what the plan for the currency was. Then they paid off the RE with worthless cash and now owned large sections of RE free and clear. This was step one to a new regime. Do you think for one second that the globalist oligarchs want a full fledged regime change to a bunch of FB's? No!!!!
Now, at this point some of you are saying, "Yeah, but the biggest borrower is the US government" and you are right but are also missing the big picture (refer back to North American Union and the Amero.) Another clue: Greenscam going on about how great ARM's are and encouraging everybody to get one right before he raised rates. Remember people, there is no U.S. Government, per se. Just a group of ultra-rich globalist oligarchs that control everything and have no debt. Let me repeat, they have no debt!!!! Now let's see...what is better for someone with no debt, inflation or deflation? Hmmmm......
So in summary, the "government" force-feeds everybody a huge debt yoke in the form of a crushing mortgage, then pulls the rug out with a nice asset bust and a deflationary depression. Then the US "government" claims bankruptcy along with everybody else and the globalist power-elite get their dream of a North American Union which moves them one very big step closer to the ultimate goal of one-world government and total domination of the masses.
How's that for a unified economic theory?
Paul Joseph Watson
Prison Planet
Thursday, December 14, 2006
A former Boston Center air traffic controller has gone public on his assertion that 9/11 was an inside job and that Donald Rumsfeld and the Pentagon tracked three of the four flights from the point of their hijacking to hitting their targets. In an astounding telephone interview, Robin Hordon claims air traffic controllers have been ignored or silenced to protect the true perpetrators of 9/11.
A recording of the phone conversation was posted on Google video late yesterday by the Pilots For 9/11 Truth organization.
After having acquired a background in aviation, Hordon underwent rigorous FAA training to become an air traffic controller and was posted to Boston Center where he worked for eleven years. He did not work at Boston Center when 9/11 occurred but still knows people that did who concur with his conclusions. In comparing the stand down of air defense on 9/11 and what should have occurred according to standard operating procedure, he quickly concluded on the very afternoon of the attacks that they could represent nothing other than an inside job.
Regarding the Amero:
As Richard Heinberg (author power down and the party is over) has pointed out Jerome Corsi (author of this article) is a "proponent of the 'abiotic oil' hypothesis and [was the] primary architect of the Swift Boat disinformation campaign against John Kerry".
Anyine that believes oil is a renewable resource is not a great source in my view.
My husband and I are thinking about buying a D.R. Horton home. It is in a planned community with great schools nearby. Our current home should sell without problem. We are in Fort Worth, Texas where there is an endless supply of land and new communities popping up everyday. So what we have here is a buyer's market. Lennar, Pulte, Cheldan, and First Texas Homes have all slashed thousands off their inventory homes. D.R. Horton has gone backasswards and raised the prices on their inventory homes and are now only offering to pay 1% towards closing costs. We found a D.R. Horton home in a community that has about 13 spec homes available and 28 lots left to build on. They plan on opening a new phase in Spring 2007. We put in an offer last Saturday for an inventory home. It listed for $171,990. We found on the MLS that it has been vacant for 290 days and the orginal listing price was $165,990. We placed an offer of $164,000 and asked for 3% towards closing costs (since we were going through their preferred lender). The VP counters back with $168,990 and only 1% towards closing. Mind you, the price to build the exact home is $171,990. I'm flabbergasted! It is near the end of the year and the salesperson with that community kept on and on about how they will negotiate on an iventory home! We were told in cofidence by a D.R. Horton salesperson at another community that the company is currently in turmoil, sales are down, and they cannot sell off their inventory! Would it be better to go back, say after Christmas and put in another offer again?
Look at Weimar Germany.
++++++++++++++++++++
I agree and posted a Weimar graph of the divergence on this sight about six months ago.
Nice analysis and a good theory. One which I had not thought of. This is a very difficult thing to predict because it is so subversive, imo. I thought for a long time the Fed Bank would protect the dollar and continue to raise rates no matter what (like in the mid 80's), but I have changed my mind and believe that the Fed Bank will hold. I think that the dollar collapse is very well planned, and it is possible that the visit to China was to make promises behind closed doors in preparation for what comes.
Your GD reference is also interesting, because many of the Local City Governments are using the Tax windfall of the last few years for building new arenas and new Art Centers, etc, to keep the misplaced construction workers busy, I think. Remember studying in school about new roads and new bridges as a solution to the GD?
*
You said, "Remember people, there is no U.S. Government, per se. Just a group of ultra-rich globalist oligarchs that control everything and have no debt."
++++++++++++++++++++++
SHOCKING ! (said with your best British accent)
Anyway, this is So, true and after I took off my myopic Republican blinders so I could stop the cheerleading long enough to reassess everything, it finally sank in. There are so many good people like me that have not realized the reality of our Gov. and the world "order". They are in a fog of just generating income, raising families and trusting that what they see is real and EVERYTHING IS FINE. It really is frustrating for me, as a convert.
(:
Anyway, back to deflationary depression verses inflation, my vote was inflation, because that is what I see. EVERYTHING IS GOING UP in price!!! Also, Mogambo calls it "US Weimar" in his latest rant.
http://www.321gold.com/editorials/daughty/daughty121306.html
And, Well, the Fed Bank did cause the Great Depression, with intent, according to the documentaries I have watched, so again, I could be wrong.
I am as ready as I can be.
We have a front row seat here.
PS, I did not like economics in College, it seem to always go in circles. Drove me nuts. So, I can only read a lot and opine. hehehe
richard,
Rather than debunking the source, how about a little feedback on the concept? In other words, does the entire plan seem plausible and does it ring true to you? Is this something that an out-of-control, mad-with-power, global oligarchy might attempt as a way to consolidate power and push through an agenda that is otherwise anathema to the participants?
You better take a look at http://spp.gov/ before you dismiss this out of hand. Notice the .gov at the end of the url? This cannot be spoofed or faked in any way.
"Anyway, this is So, true and after I took off my myopic Republican blinders so I could stop the cheerleading long enough to reassess everything, it finally sank in. There are so many good people like me that have not realized the reality of our Gov. and the world "order". They are in a fog of just generating income, raising families and trusting that what they see is real and EVERYTHING IS FINE. It really is frustrating for me, as a convert."
Great comment. I've been a Rep for several years and a conservative even longer. Now I am just a conservative again as the Reps totally sold me down the river with this immigration and one-worlder concept. BTW: I'm not saying the Dems are any better because they are actually much, much worse. You know, the global power elite probably believes that this is in everyone's best interest but they are wrong. I don't want our people to be shoved down to Mexico's level (economically) so that we can form a new psychotic NAU.
This is pure madness and if they're not careful the whole plan can backfire and a new Hitler can emerge in the US. One that unites all of the disenfranchised middle-class people in a bloody and violent vision of this New World Order. The new Hitler would find some convenient scapegoat (Mexicans? Gays? Seniors? who knows?) and round them up for extermination. WWIII and Armageddon would be the inevitable result.
Signed,
A constitutional conservative that remembers the dream of the USA as a shining light and the best example of peace, strength, and freedom for the entire world.
Well yea that is because most people don't move every year. Of course most of the previous sales were in 2004 and before.
You are making my point for me. You're saying the market is crashing and everyone is screwed but then say well, everyone except 90% of the people who bought pre-'05. That is EXACTLY my point, 90% of us will be just fine.
Unless you were unfortunate enough to buy in 2005 at the peak you are more than likely in the black on your home and in some cases well into the black considering 4.5 interest rates in 2002 and 2003. I don't have precise numbers on what % of all homes were bought in 2005, but I would venture to guess it is less than 10% nationally. And of that 10%, again I would guess 80% have no intention of selling any time soon. So what you are really looking at is a situation where 2% of the population is in real trouble.
The numbers I gave you - actual sales in the 2nd or 3rd most bubbleicious market out there - proves this out. There are plenty of buysers till who are buying homes at value much much higher than 2-3 years ago meaning the gains from 2-3 years ago are holding up.
As for your NASDAQ comparison, irrelevant. Yes you can sell stocks in a matter of seconds but selling $1000 of pets.com is not a life altering decision. Selling your home is. When NASDAQ starting tanking anyone with some money figured, WTF I better get out now and they all did at once precisely because it is only a click of a button.
But precisely because selling a home is a very time consuming process people don't just jump into the market on a whim. You don't take the kids out of school and move across town because you think the market is falling. And as I have posted before, selling and moving is not free. On a $500K home the cost os selling and moving can easily be $40K in some areas. It's not an $8 trade on Ameritrdae to sell your pets.com.
--------------------------------
--------------------------------
KILOBAR said...
Of course, the most recent prior sale was in Jan of 2004, nearly 3 years ago. The others were well before then.
This unwinding of the credit bubble will take a long time, probably years. The NASDAQ bubble took 15 months to reach its lows from its peak and you can sell stocks in a matter of seconds. Housing will take longer, much longer.
You guys crack me up. First Bush is a complete idiot who can't walk and chew gum. Then all of a sudden he is a mad genius manipulating new-cons against conservatives all with the grand master plan of creating the NAU.....do you people listen to yourselves ever?
chauncy,, good points--unfortunately ,many here cant see that there even a glimmer of possibility that any dissent can be close to accurate,, the blinders are on ,like a classic bull or bear crowd in this case...
im surprised no one has called you an idiot yet,, probably will happen soon though as you dare to dissent, lol
or even worse,, call you a (gaasp) realtor
The peak oil crisis: EIA -- The greatest failure of them all?
by Tom Whipple
For those of you who don't follow such things, there exists down on Independence Avenue a semi-autonomous little organization known as the Energy Information Administration (EIA). Created by Congress back in 1977, its mission “is to provide policy-independent data, forecasts, and analyses to promote sound policy making, efficient markets, and public understanding regarding energy and its interaction with the economy and the environment. " In short, they keep track of our energy supplies and make forecasts about their future.
The EIA takes pride in its independence from the policy-making parts of the federal government. A page of its website is devoted to Section 205d of Public Law 95-91 which says in no uncertain terms that the rest of the government shall keeps its hands off of EIA judgments -- "nor shall the Administrator be required, prior to publication, to obtain the approval of any other officer or employee of the United States with respect to the substance of any statistical or forecasting technical reports which he has prepared in accordance with law." Around Washington, that’s about as independent as you can get and still draw a federal salary.
As we all know various parts of our federal government have had some rough times lately. Remember how the FBI reacted when an agent discovered that a suspicious Middle Eastern type was learning how to fly but not land commercial aircraft; or the Corp of Engineers' seawalls; or FEMA's rescue of New Orleans, or the CIA's slam dunk; or the mother of all recent failures, the Pentagon's efforts to democratize Baghdad. These are sure to make the history books.
Now what could a small band of government statisticians do to write themselves into infamy along with FEMA at New Orleans, the CIA estimate on WMD, Rumsfield's Pentagon, and the neocon invasion of Iraq? Simple! They are in charge of telling America how much longer our cheap and plentiful energy supplies are going to last. If they get this wrong, the whole country is in a whole lot of trouble. Some think it might not even survive a rapid, unexpected transition to whatever follows the age of cheap energy.
Well, what has the EIA been telling us lately?
Every year the Administration publishes an "Annual Energy Outlook" that attempts to forecast our energy flows over the next 25 years. Last week the 2007 reference case was released. Now, the "reference case" admittedly is the case that by definition assumes nothing major is going to happen to our energy supplies in the next quarter of a century. Readily discernable trends are projected on out, but for the most part, the next 25 years is envisioned as looking very much like the last 25. While this formula may have worked for the last 30 years, its day has clearly come. Too much evidence is accumulating that energy supplies in the next 25 years will look nothing like those in the last.
The core judgment of the Annual Energy Outlook 2007 reference case is so absurd that publishing it is a major disservice to the American people. The supplies of oil and natural gas available to the American people are simply not going to continue growing merrily along as they have for the last century. A break point emanating from geology, geopolitics, or simply economic growth and demand is clearly in the offing.
In the new Outlook, we have the EIA projecting that petroleum and liquid fuels consumption in the US will be increasing from the current 20 million barrels per day to 27 million barrels in 2030. Price projections are even sillier: the $69 dollar per barrel average price for oil in 2006 is to drop to just under $50 per barrel in 2014 "as new supplies come on the market" and then rise slowly to an inflation adjusted $59 in 2030.
To give the EIA its due, the Administration states up front that predicting our energy future is very difficult and that much is changing— prices, weather, Asian economies, and technology to name a few. Moreover, they do make efforts to modify some of their projections to keep them in line with obviously changing conditions, but these modifications simply are not enough to cover the forces that are on the move in the real world. The EIA is busy describing the trees and seem to have no vision that the energy forest is on fire or that a conflagration is about to consume us all.
The EIA will soon release other projections of possible energy futures. If you want to think the world's energy situation will get better and better, well, they have a case or two for that. If you want to think the end is nigh, they have a pessimistic case too. But these cases don't get the press conferences or the wire service stories. It is the business-as- usual reference case that we hear about.
The only bright spot in all this official nonsense is that it is so out of touch with reality it can't go on for much longer. Some day in the next few years, it will become so obvious that projecting continually increasing oil and gas production and steady to lower prices is as unrealistic as the concept of "winning" in Iraq.
In the meantime, one would hope the leadership of our "independent" Energy Information Administration will get their heads out of the sand and move beyond denial to recognize we are at the brink of a whole new age of energy scarcity. By refusing to think, write, or warn about the realities facing this country's energy supplies, they are doing a major disservice to the nation. Future generations of Americans will suffer needless hardships because of our failure to prepare for the great energy transition that is coming whether we recognize it or not.
A completely new approach to energy forecasting is clearly needed.
Uhh Ohhh!!
“Given rising metal prices, the pennies and nickels in your pocket are worth more melted down than their face value -- and that has the government worried.
U.S. Mint officials said Wednesday they were putting into place rules prohibiting the melting down of 1-cent and 5-cent coins. The rules also limit the number of coins that can be shipped out of the country.” Click Here
Housing Bubble this, Housing Bubble that. All everyone talks about is a housing bubble. If everyone thinks its going to happen than guess what ...It Ain't Happenin !!
Lisa in Ft Worth, I'd wait. You do realize that metro Dallas has one of the highest foreclosure rates even though prices are below the national average? Remember, we do have high property taxes here so on that house you are looking at you can add $75,000 into the price to get to a value based on PITI.
Here in Austin the builders are the same. Most of the big guys have raised prices to try and recoup some of the reductions say in Phoenix. They old equalization that always occurs as a result of California's bubble. Once the rest of the nation comes into sync with CA and CA looks affordable again then CA prices can climb again. It is a typical cycle.
You don't say how large the house is, if it is tension slab, if it is brick/rock on four sides or siding on three, sq ft, or other ammenities so can't say if you are getting a fair deal.
From the price point I'd say you have a basic Texas house and if you see what homes in that price range sell for in foreclosure you'd either look for a foreclosure or bid low and stick to your guns.
Why are you selling? What is wrong with where you live? Are you in a better financial position staying put?
higher assessed values means higher taxes means higher priced tomatoes, have to get more of those tomatoe seeds growing, as id prefer not to see bubble prices higher, in tomatoes, while you people, nickle and dime me to death
HAPPY X-MASS KEITH
HUNTING SANTA:
http://www.transbuddha.com/mediaHolder.php?id=1254
From Fortune. “Bret and Tricia Baird are all too aware of what they’re getting into. Friends and family have admonished them to rent when they move this month to Mesa, a suburb of Phoenix.”
“With an inventory of more than 38,000 homes for sale, up 94 percent from this time last year, Phoenix is one of the shakiest markets in the country. Nevertheless, Bret and Tricia have decided to make a leap of faith. They just put in an offer of $400,000 for a 2,700-square-foot, five-bedroom house right next door to her sister.”
“The place looks like a pretty good deal, 8 percent off the original asking price of $434,000 and $5,000 less than what the seller paid for it last year. But with the way things are looking in Phoenix, the Bairds realize they could be paying too much.”
“Tricia’s sister, for example, bought her house two years ago for $225,000. ‘We’re nervous,’ says Tricia. ‘If for some reason we have to sell a couple years from now, we’re not confident that we could get what we paid for it.’”
“‘It’s possible that the broader housing market will firm in the next few months, that the worst is over,’ says economist Mark Zandi. ‘But that to me is a dead-cat bounce.’”
“This time last year the big question was whether the real estate market was going to slow down. Today it’s ‘How bad will it get?’”
Gold ( Spot and near futures) finally dropped almost 14 bucks ( www.kitco.com ) Its been threatening to do so for almost 1 week( I hope people took note of my comments about being watchful on gold last week). My sense is its heading further down.
The combination of data today is in WTF? territory for me - CPI ( core and headline ) UNCH, dollars strengthens with DX back to almost 84; But OIL is still high 63.5, and 10 year treasury rates after dropping in the wake of the CPI data to 4.52% swiftly returned to 4.6% over a few hours.
So we have high real treasury interest rates ( people need to be incentivized to buy Treasuries even in the face of tame inflation data), and so no expectation of lower fixed rates mortgages; lower gold ( no expectation of inflation or currency depreciation or printing money), the DX suggests the same, but higher OIL.
I always thought we'd get inflation first then a deflation but this feels like cash is KING is the incipient theme FOR NOW, i.e. deflation of all assets with gold acting as a commodity at this time and also deflating. Lets see if stocks start heading substantially lower, as do other commodities - they ought to in the next couple of weeks otherwise its back to WTF? territory. I'm going more short by adding to QID and DXD. But getting out if the DOW adds 200 from here.
With persistent stable and IMO ticking higher 10 Year treasury rates, we should start hearing about mortgage rate upticks and cancelled ARM to fixed mortgage conversions and the housing deflation should continue.
-K
Happy Hanukkkah, Honica!
Gold sank through Friday's PM fix and continued falling below $623 as the weekend began.
"Prices are down because the Dollar is stronger," said one wag to the newswires. "Gold has come off quite a bit in the last few days."
Either he didn't notice or care that gold in fact reached new four-week lows in all major currencies. But analysts continue to watch the Dollar closely after US data pulled both ways on the currency markets.
The last time we were told there was now inflation the fed lowered the discount rate to 1%. Then Greenspan said he had faulty inflation data and he kept rates too low.
How can we ever believe this data on inflation?
McCain Bill Is Lethal Injection For Internet Freedom
Exploits fear of sexual predators and basic misunderstanding of Internet to attack blogs critical of the warmongering agenda he fronts for
Paul Joseph Watson
Prison Planet
Friday, December 15, 2006
Republican Senator John McCain has introduced legislation that would fine blogs up to $300,000 for offensive statements, photos and videos posted by visitors on comment boards, effectively nixing the open exchange of ideas on the Internet, providing a lethal injection for unrestrained opinion, and acting as the latest attack tool to chill freedom of speech on the world wide web.
Yes indeed many homes have been refied and HELOCed and? Who cares how much the home owner owed? What counts is selling price. As a buyer that is none of your concern. Point is 90% of homes are selling for more than they were last purchased for. Whether the seller walks away with $0 or $150K is not at issue.
Plus you assume that every HELOC and every REFI was 100% cash out. There is no data to suggest this. Taking out $50K in HELOC out of $125K equity does not mean financial disaster.
Every discussion here is at the extremes. EVERYONE who bought a home used a toxic morgage. EVERYONE who got a HELOC got 100% of equity. EVERYONE who has an ARM adjusting will be forced to sell. EVERYONE who got an interest only mortgage is under water. EVERYONE needs to sell today.
Well no, that just isn't the case.
-----------------------------------
-----------------------------------
KILOBAR SAID:
Additionally, many of those earlier purchases you refer to have been refi'd or HELOC'd; an important factor I don't believe people are paying enough attention to. How this market has been financed over the past 5 years is unlike anything the RE market has ever seen. For example, in Colorado, prices have increased by around 50% to 60% in the past 5 years. However, the average homeowner only has 15% equity. An enormous amount of money has been pulled out of the RE market. Financing is a very important variable when analyzing this market! Small decreases in prices get magnified in a negative equity situation.
The NASDAQ comparison does apply. You cant just sell your house quickly if you need to. When ARMs reset or people need to move in a negative equity situation and can't, things can get ugly. A huge number of foreclosures are right around the corner. Again, home financing is a huge problem. It isn't just about supply and demand.
A head fake by gold.
PTB going after the weak EFT hands...probably hit 580 or 550 in January then shoot to 700 plus plus plus in spring.
No money? No problem!
------------------------
richard -
probably hit 580 or 550 in January then shoot to 700 plus plus plus in spring.
-----------------------
A drop of between 70 to 100 from 650 in two months would be a headfake ? You have a strong stomach! Not me. I got out of most at 632 and a teary eyed, poignant farewell to the rest of the shiny stuff today at 628.
I agree with you though. Gold will, like Batman and Superman return - I'll be watching the price action closely and when it does return so will I - ready to buy if it rises past 644 and start watching it carefully once it drops below 580 - I can't figure out in what "real" guise it will return though( money or commodity). I thought we'd be getting price inflation first, soon, kinda right now and on going followed by deflation and thus the return of gold as a hoard of value in the first instance. On the data as of now, price inflation seems to be receding over my 6 month horizon.
-K
RE: McCain bill:
OMG! It's all true. They are trying to turn this country into an Orwellian negative utopia. Oh well, I have all the information I need already anyway. Signing off the 'net now. They've found us. Time to move underground. See y'all in the funny papers!
Signed, Buzz Saw
P.S. Good luck bloggers, you're going to need it. The gulag goons will be coming around soon enough. I'm not kidding. Later dudes and dudettes.
SK- hang in there - 1850 around the corner.
Buzz - slowly the frog boils.
I gist bowt a houses for 850k. it a fixer wit no ruf and smell bad. shuld i tayk outta HELOC to make poop smell go and infest the rest in internets?
http://money.cnn.com/magazines/fortune/fortune_archive/2006/12/25/8396764/index.htm
How stupid can you be? RENT the fricking house next door to your sister!!!
http://www.breitbart.com/news/2006/12/15/D8M1ILB00.html
BOB BARR JUST LEFT THE GOP... SAID THEY ARE CORRUPT AND NOT INLINE WITH SMALL GOV AND CIVIL LIBERTIES ANYMORE
Republican Senator John McCain has introduced legislation that would fine blogs up to $300,000 for offensive statements, photos and videos posted by visitors on comment boards, effectively nixing the open exchange of ideas on the Internet, providing a lethal injection for unrestrained opinion, and acting as the latest attack tool to chill freedom of speech on the world wide web.
----------
this from a former prisoner? this is the bullsh!t I was watching for, post 911.
Buzz Kill?
Republican Senator John McCain has introduced legislation that would fine blogs up to $300,000 for offensive statements, photos and videos posted by visitors on comment boards, effectively nixing the open exchange of ideas on the Internet, providing a lethal injection for unrestrained opinion, and acting as the latest attack tool to chill freedom of speech on the world wide web.
+++++++++++++++
By espousing this kind of extremism, McCain is just sidelining himself. I don't believe the Republicans will be stupid enough to choose another fanatic for the Presidential nomination.
what is "fu" keith's problem? I know we are not allowed to feed the trolls but this guy spent too much time on a stupid graphic. Maybe he should get a hobby, or, get a lfe and join a civilized debate. Unless of course he's just a moron. Let's see his low-voltage response prove it.
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G'night
News building news!
San Diego east county El Cajon area. 'Large' developement currently under grading
(25Mil grading contract) and underground shut down!
Developer see's no future in home sales, so it has been put on a 'long term hold'!
WITH REGARDS TO CASEY SERIN AND KEITH'S LAST POST:
Keith,
You've got to be kidding me! I think the fact that you've made personal contact with Casey has clouded your judgement. Remember all your talk about people who should be flipping burgers but instead are trying their hand at real estate? Casey is the poster child for this conundrum.
I went to college to get an engineering degree and grad school to get my MBA and have a dozen years of HARD WORK under my belt just to be able to make 6 figures. Yet you want to tell me that some lazy ass, lying, no good punk who probably doesn't even have a GED and wants to be an overnight mogul deserves my pity. What does he know about economics, let alone math, that makes him qualified to do anything besides flip burgers.
FUCK HIM. I hope he gets what he deserves. I hope he goes to jail and his wife leaves him now that she knows the LOSER that he is. Cause not only is he clearly a lazy ass, jamba juice sipping pussy BUT he's also the last man into the pyramid scheme which makes him ignorant, stupid and a DOUBLE LOSER. (BTW, all that sugar isn't good for you, veggies are better).
That said, maybe after he's paid his dues to society maybe he can get a real job, save up some real money and then become an investor in something. Cause right now, he's just a public nusiance, a public pariah, a sad excuse for a human being, and, I'll say it again, one lazy ass punk who needs to learn his lesson.
AND YOU'RE VOUCHING FOR HIM KEITH?
SHAME ON YOU.
Yours truly,
A very pissed off, upset regular reader of HP who now questions Keith's objectivity.
Nice blog you have here.
by the way check out.....
http://www.stylepit.com
you will like it they have got interesting stuff.
This One is for you Ricahrd and you Buzz.
Have a Look at the Shocker Editorial Image from rense.com today.
http://rense.com/1.imagesH/patriotact12dees.jpg
Do you thinik he deserves a fine of $300,000.oo levied by and for the Government?
Real Men Love flyingmonkeywarrior!
SASS and brains are SEXY!
Awe shucks. (said in your best southern drawl)
Thank you anon. (:
Still waiting for feedback on part of a previous of this previous post: New list for 2006 to 3Q, Demark up 23.3%, Ireland up 14.2%, Canada up 12.8%, South Africa up 12.7%, France up 12.5%, Belgium up 11.8%, Spain up 10.8%, New Zealand up 9.6%, Australia up 9.6%, Britain up 9.6%, the list goes on and does recognize that in those same markets some areas were flat, while others continue to rise.
It notes that in Australia prices rose rapidly in 2003, fell in late 2004/2005 and are no increasing with perth up 46% this year in the third quarter.
Looking at the price rise between 1997-2006, South africa up 327%, Ireland up 252%, Britain up 192%, Spain up 173%, Australia up 132%, France up 127%, Sweden up 123%, Belgium up 118%, Denmark up 115%, the USA up 100%.
Last night on CNN they said new report said inflation was outside food and energy was ZERO for the last report. Deflation finally on the doorstep or a new round of interest rate cuts, more liquidity, and we will follow the above countries for one more year?
Why are they still going up and we crashing? If we crash 40% over say two years shouldn't they crash as well and if they are up 200% by an even larger measure and how will that affect them?
If we have the correction now wouldn't we be in a better position than when the rest of the world corrects since many of those markest are more "frothy" as Greenspan once describe our market?
Dear foxwoodlief,
None of it matters if the dollar is dumped by China on Monday. Look for Weimer USA.
None of it matters if the Saudi's have a go at China.
I'm just sayin'.
foxwood,
Shhh!! You are asking too many questions. To properly answwer those questions in the "end of the world" context takes too much twisting and Keitk, kilobar and Co. might hurt themselves.
Kiloar,
You're arguing two sides again and for the third time in this thread making my point for me.
On the one had you say the reduction in listings is due to people pulling their listing and waiting for the price they need to sell.
Then you say ARM adjustments are casuing desperation sales and people are taking anything they can get.
Sorry, can't have it both ways. Either people are desperate and will take anything ****OR**** they can afford to wait 6 months to sell until they get the price they want. But those two actions are mutually exclusive. Pick one of the two arguments please, but you can't argue both sides.
Your math is wrong as well as intentionally misleading. A 50% rise in prices would not equate to a 50% raise in equity. Only way this works is if the house is bought with cash.
Example:
Home worth $100K
Equity = $15K or 15%
Mortgage is $85K or 85%.
Price incrases by 50% to $150K
Equity rises to $65K = 43% .
Owner takes out $42.5K in refi.
New equity is $22.5K or 15%
New Mortgage is $127.5K (85%)
House falls by 16% to $126K. Owner is underwater by a whopping $1500.
Not exactly the end of the world is it? Would you sell your home because it is worth $1500 less than what you ower? Not me.
=====================================
kilobar said...
No, I posted that there was a 50%+ increase in prices, yet the average homeowner mow has only 15% equity. Just think...a 16% decrease in prices and the average homeowner will be underwater.
From Barron's for this weekend :
Unofficial survey of equity extraction ( the infamous "tapping" your home equity ) developed by Greenspan and former Fed staffer shows:
2005Q3 : $236 billion
2006Q1 : ?
2006Q2 : $151 billion
2006Q3 : $114 billion
This is all looking backwards and no doubt merely confirms what the retail sales slowdown at Home Depot and others. But is there more meaning to be extracted from the size of the slowdown.. I mean a 50% cut year on year is signficant.
What was going through people's heads at a psychological and emotional level as they stopped extracting equity and battened down the hatches? And is that a longer term mental state or are they so beaten down that they have said : O Screw it - and resumed extraction - it might explain recent mortgage apps, sales resurgence ? After all wages surely haven't gone up. and the wealth effect from stock market rises can only translate in real spending if there is real money to spend - loans against your 401K ?. CC debt perhaps?
I have no idea. Ideas ?
-K
I came across this article and found it to be interesting.
From Ben Bernanke:
Speaking on behalf of all the Fed members we thought it was time to honestly address the situation the country is facing. This is part of our new policy to be as candid and honest as possible. Quite frankly we are frightened by the rapid falloff in housing permits, the rise in jobless claims, the rise in inventories, and the slowdown in consumer spending. It now appears the landing is not going to be soft and it is also doubtful the financial markets are fully prepared for it.
More
OK...TIME TO PUT ZILLOW ON BLAST!!! This joke started out as a good idea, but now it is swinging to please the fools and idiots with value increases over 15,000 in 30 days. This "SECRET" software they use to calculate values seems to be a damn sick cat pushing buttons in a box...
~BD
zillow has shown my home lost about $20K over the last couple of months...those cats aren't helping me much
After all the time I've posted here I have to confess, I'be been wrong.
You all are right. Hate is evil and I repent.
I have to confess, I hate myself because my family were marranos. I hate they didn't have the balls to stand up for our faith and converted to Christianity during the inqusition.
I am Jewish. I'm circumsized. My Jewish girlfriend dumped me because she didn't like Missouri and small penises.
I apologize to all those mexicans, african americans, and other races I have offended. I even considered converting back to Judaism or even Islam to return to my semetic roots.
Thanks for forgiving me.
TROLL
According to this Senior source, China told the U.S. delegation they no longer have faith in U.S. Currency for several reasons:
1) The Federal Reserve Bank ceased publishing "M3" data in March, making it nearly impossible for anyone to know how much cash is being printed. China said this act made it impossible to tell how much a Dollar is worth.
2) The U.S. Dollar has lost upwards of thirty percent (30%) of its value against other foreign currencies in the recent past, meaning China has lost almost $300 Billion simply by holding U.S. Dollars in its reserves.
3) The U.S. has no plans whatsoever to reduce deficit spending or ability pay down any of its existing debt without printing money to pay it off.
Hilarious!!!
They're owning homes on borrowed time
With 'pay option' loans, borrowers sink into debt
AnalysisGuy said...
I just shot-up the Q3:2006 reports for Orange County, Inland Empire, Ventura, DC & New York
They join prior FREE reports on Bakersfield, Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, San Diego, San Francisco and Seattle.
thebubblebuster.com
Saturday, December 16, 2006 8:21:18 AM
GO AWAY!
And HERE it is, the back door deal we have been expecting.
US to give China four N-reactors
Saibal Dasgupta
[ 17 Dec, 2006 0046hrs ISTTIMES NEWS NETWORK ]
BEIJING: China, which had expressed strong reservations about the Indo-US deal on nuclear energy, on Saturday placed a $8 billion order for the purchase of four nuclear plants from the United States.
The move is expected to influence the changing dynamics of nuclear politics involving India, United States, China and even Pakistan, which is a major recipient of nuclear technology from China.
The deal with the Westinghouse Electric Co also involves technology transfer, which China has been insisting upon through the two-year process of shopping for nuclear plants worldwide. For the US, it is a small measure of success in its repeated attempt to get Beijing correct the enormous trade balance of $200 billion that it enjoys over Washington. It might also smoother the ruffled feathers in Beijing over the stalling of a Chinese bid to buy Unicol in the US.
Last night on CNN they said new report said inflation was outside food and energy was ZERO for the last report.
--------------------
I love this nonsense! "Well, inflaton is zero if we don't count the increase prices in oh say EVERYTHING!" If you cut out housing, gasoline, natural gas, the d^mn Italian beef, fries and pop that's going for $11 and change, then sure everything is just peachy!!!
Open your eyes and use them.
http://timesofindia.indiatimes.com/NEWS/World/Rest_of_World/US_to_give_China_four_N-reactors/articleshow/825612.cms
http://tinyurl.com/yyf8ya
BEIJING: China, which had expressed strong reservations about the Indo-US deal on nuclear energy, on Saturday placed a $8 billion order for the purchase of four nuclear plants from the United States.
!!!!!!!!!!!!!!!!!!!
OH MY GOD!
I wonder if anybody has heard that China is dumping 1 trillion US
dollars and getting euroes? It was announced on the "Hal Turner Show"
yesterday.
Also looks like banks are gearing to limit withdrawals to $1000.
Got gold?
well here is the article anyway...silver time!!!
BEIJING, CHINA -- Sources with a U.S. Delegation in Beijing have told The Hal Turner Show the Chinese government has informed visiting Bush Administration officials they intend to dump One TRILLION U.S. Dollars from China's Currency Reserves and convert those funds into Euros, gold and silver!
China was allegedly asked to withhold the announcement until Bullion Markets closed for the weekend to prevent an instant spike in gold and silver prices. This delay will give the world the weekend to consider appropriate actions rather than have a knee-jerk reaction which could see the U.S. Dollar totally collapse in value Monday.
According to this Senior source, China told the U.S. delegation they no longer have faith in U.S. Currency for several reasons:
1) The Federal Reserve Bank ceased publishing "M3" data in March, making it nearly impossible for anyone to know how much cash is being printed. China said this act made it impossible to tell how much a Dollar is worth.
2) The U.S. Dollar has lost upwards of thirty percent (30%) of its value against other foreign currencies in the recent past, meaning China has lost almost $300 Billion simply by holding U.S. Dollars in its reserves.
3) The U.S. has no plans whatsoever to reduce deficit spending or ability pay down any of its existing debt without printing money to pay it off.
For these reasons China has decided to implement an aggressive sell-off of U.S. Dollars before the rest of the world does so. China reportedly told the US delegation; "we are the largest holder of U.S. Currency and if the rest of the world unloads theirs before we unload ours, we will lose our shirts."
Early this week, in an unusual move, the Bush administration sent virtually the entire economic "A-team" to visit China for a "strategic economic dialogue" in Beijing Dec. 14 and 15.
Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke lead the delegation, along with five other cabinet-level officials, including Secretary of Commerce Carlos Gutierrez. Also in the delegation is Labor Secretary Elaine Chao, Health and Human Services Secretary Mike Leavitt, Energy Secretary Sam Bodman, and U.S. Trade Representative Susan Schwab.
The Bush administration wanted to get China's cooperation in preventing a dollar collapse. The Hal Turner Show has been told the effort failed.
According to the source, Fed Chairman Bernanke left the meeting "pale and in a cold sweat" as the implications of China's decision seemed to sink in.
The implications are enormous: The U.S. Dollar is likely to collapse in value against all other major currencies as early as Monday, December 18.
This would cause a worldwide sell-off of dollars, create almost immediate "hyper-inflation" in the US and also impact world markets at a level "worse than the Great Depression of 1929."
Arabs to the rescue?
In a strange twist of fate, Arabs and OPEC may come to the rescue of the U.S.!
Senior officials in OPEC made clear that they too would be severely harmed if the U.S. Dollar collapsed, and hinted they "would not be inclined to sell oil to any particular nation that intentionally caused such a collapse."
This was a thinly veiled threat to China, which depends heavily on OPEC oil for its rapidly developing energy needs.
The OPEC officials even went so far as to say "Since China lacks the ability to project their military power, OPEC nations need not worry about any Chinese military response to an oil cut-off."
Such brutally candid remarks will not sit well with China; and signal ominous things for the U.S. .
Arabs and OPEC will want something in return for saving the U.S. from economic collapse and it is already widely speculated what they want will be a complete change in U.S. backing of Israel in the Middle East.
If such demands are made by the oil-rich Arabs, the U.S. would be left with little choice but to virtually abandon the jewish state to preserve itself.
Well, Borka,
Does the Nuke Plant plan stave off the Saudis power move? Or some of the US debt?
It is too little too late reckon.
What do you think?
Westinghouse deal just a coinkadink?
Hi Richard, Dick to some!
OH MY GOD!
**********************
Get a Clue and read before you look stoopid.
Oh, wait, thats why you post as an anon......
Westinghouse deal just a coinkadink.
Of course it is that deal was probally inked before they even arrived in China...I have not seen anything on the $1000 withdrawl limit can you please back that up with a link rich?
if that be the case ill be going to the bank every day this week for sure.
Then, with the U.S. economy in shambles and its manufacturing base eroded by a steady stream of manufacturing plants moving out of the US., the American government will be too occupied with troubles at home to do much internationally. America will be in no position to challenge China, allowing the Chinese to act militarily elsewhere in the world;
Further, if the U.S. attempted to intervene against any Chinese military action, the only plant in the world which can manufacture the specialized gyros needed for U.S. Cruise Missile guidance systems, is now located in. . . . .China.
!!!!!!!!!!!!!!!!!!!!!!!!!
!!!!!!!!!!!!!!!!!!!!!!!!!
!!!!!!!!!!!!!!!!!!!!!!!!!
Oh are we fvcked!!!!!!
FlyingMonkeyWarrior said...
OH MY GOD!
**********************
Get a Clue and read before you look stoopid.
Oh, wait, thats why you post as an anon......
Saturday, December 16, 2006 8:47:03 PM
----------------
what's your problem? arnt u shocked by this?
sorry, I was over sensative and I thought you were making fun of me.
boo hoo. I guess it is the chick in me.
Yea it scares the shi! out of me.
borkafatty said...
Westinghouse deal just a coinkadink
I don't think so
FlyingMonkeyWarrior said...
sorry, I was over sensative and I thought you were making fun of me.
boo hoo. I guess it is the chick in me.
Yea it scares the shi! out of me.
Saturday, December 16, 2006 8:58:58 PM
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No, no sarcasm here! NONE at all. I'm not being sarcastic here either. Or, am I? No, j/k.
Seriously, this is b-a-d.
"(The agreement) represents a major step forward in our relations and will advance our bilateral trade relationship and the energy security of both our nations," US energy secretary Samuel Bodman said in a statement after signing the memorandum with Ma Kai, the chairman of the National Development and Reform Commission, China’s powerful policymaking body.
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guess they can stop blaiming Clinton, now, eh?
Westinghouse deal just a coinkadink
I don't think so
------
prove it! to obvious for me..china has to spend some of their script on something...what do you they are going to sit back and loose 300billion dolla's and go out and eat burgers for the night...please
8 Billion is not enough to affect the deficit; it does take the China Gov. off of some oil dependency. If Saudi is threatening China with a cut off of oil dependency, if they tank/sell the dollar, the Nuke Plants will be in the equation. The Saudis want the US beholden to them. This is obvious. It is a three way power play oil vs the USD ve war in the Middle East.
Am I the only one that sees the connection?
I have been wrong before.
guess they can stop blaiming Clinton, now, eh
lol my thoughts exactly.
Hp better change its name to WP, World Panic.
WaMu Whiplash: Fast Expansion Yields Problems
By Ann Carrns
Word Count: 1,257 | Companies Featured in This Article: Washington Mutual, Bank of America , Wachovia, J.P. Morgan Chase
Three years ago, Washington Mutual Inc. was on its way to becoming the banking industry's newest household name. The Seattle thrift was opening new retail branches at a whirlwind pace, convinced that building from scratch was a smarter way to create a nationwide empire than mammoth acquisitions of rivals like Bank of America Corp. and Wachovia Corp. had struggled to pull off.
Armed with cheeky marketing and an unconventional branch design that replaced bank-teller counters and safe-deposit boxes with freestanding teller kiosks and cheery greeters at the door, Washington Mutual saw its profit double between 2000 and 2003. After reaching ...
Where is this awful economy y'all are talking about. Greater Depression? I see no evidence of this at all, just the opposite actually.
Last night I went to the ballet (no jokes please, my wife made me lol). We had the el cheapo seats at $55. Most expensive seats are $95 I think. Every seat in the house was filled.
Then my wife and I went to grab a late night bite. 20 minute wait for a table...at 10:30pm. Average entre $15-20.
This morning I played golf and every single tee time was taken for the day. This is a run of the mill public course, fees of $40.
Sorry folks, I just don't believe we're reliving 1931.
There will come a day unlike any other day,
an event unlike any other event and a crisis unlike any other crisis.
It will emerge out of nowhere at a time no one expects.
It will be an event that no one anticipates—a crisis that experts didn’t foresee.
It will be an exogenous event—a rogue wave.*
Yea Borka it will be called Monday, Dec. 18, 2006.
Nothing in China or the Middle East will keep me from golf, eating out or the Broadway Shows.
borkafatty said...
Westinghouse deal just a coinkadink
I don't think so
------
prove it! to obvious for me..china has to spend some of their script on something...what do you they are going to sit back and loose 300billion dolla's and go out and eat burgers for the night...please
Saturday, December 16, 2006 9:03:19 PM
---------------
This not an unrelated coincidence. Yes, they did not buy 300B in reactors, but they got Bush's attention then got something they wanted.
This deal has been going on for 2 years. But all of a sudden, China says they are pullig the plug on the USD. And that just happens to coincide with a deal for 4 nuke plants and "involves technology transfer".
No way Jose! This was part of the deal over the USD and China will get more of something else later.
I might add that I opined about back door dealings during the US China talks, and have been watching for just such an outcome. They are connected.
There will be more brown nosing by the US.
Hal Turner is your source? Lyndon LaRouche was unavailable? And it "looks like" banks are getting ready to limit $1000 withdrawals....also from Hal or do you have an actual source for this, you know life from someone at a bank?
Come on man, you can't quote crackpot radio hosts and expect to be taken seriously.
===================================
Richard said...
I wonder if anybody has heard that China is dumping 1 trillion US dollars and getting euroes? It was announced on the "Hal Turner Show"
yesterday.
Also looks like banks are gearing to limit withdrawals to $1000.
Got gold?
No real link Bork.
Check out:
http://www.halturnershow.com/index.html
Then read the comments sections under the srticle on $1000 cap...not nationwide yet...Texas yes...Cali no.
Either way...I would pull cash out. You are right bork...an event will occur that will cause the bottom to fall out.
The fundamentals have eroded away. Nothing supports the US house o cards.
BTW - bunker way delivered on site today. Cots enroute from ebay...just order a Falcata Sword from Generation2 swords and a American Tomahawk from botach. The Mission titanium 11 inch tach knife arrived 3 weeks ago and I hope to get 10 consussion grenades under the radar (my get caught around an FFL permit, then I will have to have a cop buddy of mine broker this.)
Another years worth of food came in 2 weeks ago...solar pump and panels on deck and hand pump still in box.
I'll probably get run over by a drunk next week and my x will sell all the militia stuff on ebay for pennies.
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