August 07, 2007

Want to know why housing is now crashing, foreclosures are soaring and the Ponzi Scheme ended? Just watch this video from 2005


David Crisp. Casey Serin. Shoe shine guys. GEDs. And then the music ended, and they got slaughtered. Just like the dot-com boom and bust.

Reason #446 why there should be no bailout - yes, some innocents got caught up in this mess, but it was speculators, fraudsters and gamblers who gamed the system, caused the housing bubble, and if they didn't get out soon enough, got burned.

Thanks J for the link.


Making a quick buck in real estate - In a hot housing market, some youngsters cash in

CNBC May 21, 2005

WASHINGTON - Chris Schartiger, a twenty-something in Washington, D.C., recently made $10,000 in six days — maybe not in paper money, but definitely on paper.

He put down $5,000 for a condo in the D.C. area and a week later an identical one sold for over $15,000.

For me, it was a no-brainer to go into real estate with the housing market as hot as it has been recently,” Schartiger said. “People are making 20 to 25 percent easily, so even if we make 10 percent, or 6 percent, that’s better than the market’s doing recently.”

Schartiger may sound like a professional real estate investor, but he is in fact a 25-year-old investor and one of a growing group of young real estate speculators buying condos, often before they are built, and using them to turn a fast profit.

20 comments:

Anonymous said...

According to David Lereah, chief economist at the National Association of Realtors, these investors’ speculative behavior is making some local real estate markets more vulnerable to price bubbles, which may soon burst.

Crazy how it seems that DL actually started warning us. Here is where NAR surely repremands him.

Anonymous said...

Hey, it will sell so long as it's priced correctly! Nevermind what mortgage you're straddled with ... the shortfall can always come from your savings. Wait, no one has any savings?!? Oh sh*t!

Anonymous said...

When the kids get in the pros get out

Anonymous said...

Amazing the difference that 2 years makes. Anyone selling a condo in metro DC is screwed unless they bought pre-bubble. To buy a condo today is a guaranteed money loser!! Apartment to condo conversions are reverting to apartment. Condo developments are converting to apartments. Inventory is skyrocketing, sellers are competing with developers and getting crushed, more inventory is being added because some plans just cannot be turned off. Good luck!!

Anonymous said...

"The thinking is speculators are only looking to flip a property, or sell it quickly for a profit. In many cases, these speculators are only putting down a small deposit that they are willing to lose if the market drops sharply. That leaves the developer with a property that he could have sold to a legitimate homebuyer for a lot more money, and now has to sell for a great deal less."

Recent WashPost article highlighted the fact that many legit sellers of condos are competing with developers who have a large stable of units still several years after the plans were sold out because of cancellations by speculators, so this article's predictions have come true in just 2 short years!!

Anonymous said...

funny, i couldn't find that kid's transactions at the WaPo RE sales search page to see how underwater he really is and if he has sold yet.

anyone?

area 51 said...

Little Boys Icarus........

Outstanding video.
And long before I'd ever even heard of the housing bubble. Makes it even more shocking that she finally makes the obvious conclusion.

Your honey, Diane, called it a "bubble" even back then. Very little caution though, the video looks almost like a promotion.

So much for those "shrewd" flippers, who with a wink and nudge (read: LIARS) said they would occupy the residence. No mention of mortgage fraud in the piece though.

And now, just now, Diane finally says, "Greedy investors brought this upon themselves..."????

Great timing!

Anonymous said...

DC IS DIFFERENT
.
.
.
WE HAVE THE FEDERAL GOVERNMENT TEET
.
.
.
RE WILL NOT FALL IN DC.
.
.
.
MARKET DOWN -50
.
.
.
DOPES!
DOPES!

SmokingCrack said...

This house in zip 94577 sold barely 2 months ago for $700k in all original condition...
http://www.hbrhomes.com/listingdetail.cfm?ID=200533&BID=22

Then it was flipperized in less than two months, and now its back up on the market for 200k more!

Sorry! all jumbo loans are all much more expensive now... that is if a buyer can qualify for one now at 8%!!!

Anonymous said...

That's one tough (old) lookin twenty yr old!

bub said...

That guy's fine. He's got that GEICO gig going for him.

Sweet!

Anonymous said...

Let's clear one thing up:

THERE IS NO BUBBLE!

Bubbles are for bathtubs.

Anonymous said...

some stock market crash

DOLTS

daniel said...

Home Sales Report: What’s Left?

That should make clear how the market is really looking as of today...

SeattleMoose said...

It's all those greedy boomers....oops!!!!

Anonymous said...

do all young American males have to look like shit? are hair brushes and razors illegal in America now? clean up your act slackers!

Tom said...

Let's clear one thing up:

THERE IS NO BUBBLE!

Bubbles are for bathtubs.


And ignorance is not a virtue. Judging by the majority of your posts, ignorance (and denial) may very well be a genetic disorder.

Anonymous said...

I actually know the guy they interviewed! AND I've been to the condo. It was a 2/1 conversion property no where near the metro (dc's subway). I know he and his then gf (now wife) paid over $400 for it.

They recently moved to California and had to rent it out...but I know they're not coming near to covering the mortgage payment.

Anonymous said...

Note the sloping forehead and jutting eyebrow ridge of this specimen. Note the dull look on his face and empty stare in his eyes. These are the typical physical attributes of the R/E bubble speculator (speculatus bubblensis).

Mike Mosieur said...

“For me, it was a no-brainer to go into real estate with the housing market as hot as it has been recently,” Schartiger said. “People are making 20 to 25 percent easily, so even if we make 10 percent, or 6 percent, that’s better than the market’s doing recently.”

Hey Schartiger, do you do anything that is actually a "brainer" requiring cognitive thought, logic and maybe some advice from someone with experience? Didn't think so.