Homes Way Over Valued

[Ron61]

Saw this in the headlines and of course most people here already knew that Calif. would be among the top. Also there is a story abut the credit cards that will wake up a lot of people.

http://finance.yahoo.com/real-estate...dly-Overvalued

Ron

[4RE KLR]

It is bad almost everywhere, but Florida, Arizona and California seem to be the worst. It seems like those areas the prices rose first and the fastest though.

I also think those areas will be one of the first to start the recovery process.

Did everyone see that the stock holders are trying to throw Bob Toll out of the boardroom and off the payroll of his own company? They are citing poor performance and his ridiculas salary. He is pissed off that he paid himself $50Million in 2005 and 2004 and he only got $8.9M in 2006 and $1.7M in 2007. Poor baby!!!

[Ron61]

Steve,

About 3 years ago one of the local real estate companies had an estimator come look over my place to see what it would sell for. She gave me a price more than double what it is worth and I told her so. Then I heard that a little house just up from the street from me that has just enough room around it for it to be legal sold for $200K and it wasn't worth over $75K back then. It had set idle and windows were broken as some of the dopers and alcoholics kept breaking them to move in. So whoever the people are that bought it had to have all that mess cleaned up too. Now I see as many for sale signs as I do for rent signs.

Ron

[uncltodd]

I just took a $61K hickey after almost a year on the market.

Professionally appraised, at my expense, at $231K.

Just sold it at $169k

You bet your sweet little wiggly bottom it hurt.

Location, location, location.

UT

[Cobrabill]

Wiggly bottom?Thanks for the visual.

New building in and around Maricopa,Casa Grande & vicinity has gone ape-$hit in the past few years.Builders sued a stock yard to move just becasue they wanted his land.Thank-fully the judge told them that if they wanted the stock yard property,they should have bought it back in 1950 when the owner did.
The first "developements" had so many buyers that a lottery was held.They were offered at $268,000.Then the market started south.Now there are new houses in the next community over,going for $130,000.It must feel wonderfull owing TWICE what your castle is worth.

One last one:Some of you have heard of "Hidden Valley Auto parts".They are in Maricopa.Back at the height of this insanity,they sold their land to a developer for EIGHT MILLION $.Now the land sits empty 'cause of the market.Ooops!

[Slick61]

Yep... I did a cross-country relocation in the spring of '04. My house in Florida sold in a matter of weeks. Which was good, considering I had to now deal with Southern California prices. I knew what to expect, but was still freaked about housing costs. At the time, the market was so hot you basically had to walk into a place & say... "Okay". I set a price range & stuck to it... I hate my house, & it's no where NEAR as nice as my Florida house was, but I can afford the mortgage.

I bought-in before the peak, & at one point, my home's value was up almost $200k. Am now back to square one... actually, according to Zillow, I'm $10k in the hole. I have 2 more years til my mortgage starts to adjust. Not sure what I'm going to do. Would like to move to a house I like better, there's 2 houses down the street that've been on the market for over 9 months. May have to stay put til values recover somewhat (if ever). My ARM has a max increase of 2% per year for 2 years. I made sure that I would be able to handle it no matter what happened. My only regret is that I could've gotten a much nicer, much newer house for about $10k-$15k more. Oh well... live & learn.

What really irritates me is all these articles telling people that if they can't make their mortgage payments... just walk away. What about the rest of us who live within out means & pay our bills on time... (even after rate adjustments) Why do we have to pay for the stupidity of others? A lot of people place blame on the lenders... which, to a point, is true... but no one put a gun to the buyer's heads to sign those mortgage papers. Continued appreciation & low interest rates were NOT guaranteed. There's such a thing as PERSONAL RESPONSIBIILITY! A dying concept, granted. These days, it's more convenient to say "it wasn't MY fault". ugh... don't get me started.

ok... off my soapbox for now.

[Ronbo]

Homes aren't the only thing, $60k SUV's that were $20k, My $75k Kirkham roller. (least it's not financed)

Most people's pay has not tripled in the last ten years, but vehicles and cars sure have.

Thing that scares me is this "slump" has more in common with the depression in that the finacial instutions themselves caused it. The local government here is already whining about the loss in property taxes and of course increasing them.

A true leader eats and sleeps as his soldiers do so he knows what they're capable of. I rarely see examples of this.

[Excaliber]

What price drop? My place continues to go up. I'm astounded by the comparable sale prices in my nieghborhood. Wish I could sell and take the money and run, but, run to where?

[Ron61]

Ernie,

You are in an exceptional place. Now the state is $15 billion in the hole, Thanks Davis, and the latest was to do away with most tax deductions including any deductions for dependents. Even in this state I don't think that will fly as to many of the powerful people have dependents to let their paid Senators and Representatives do that. Why is no mention ever made of cutting down on the dam spending for their pet projects.
In the paper yesterday they were giving examples of loss of attendance at schools. At McCloud which you are familiar with in the 1990s they had over 200 students. They now have 6. Arnold has tried to do something but Davis has left this state in such a mess I don't know what can be done. The more they tax, the more people and businesses leave and the less tax base they have. And of course the illegals move in and immediately start demanding all of their privileges such as medical and such.

Ron

[CSX 4039]

Originally Posted by Excaliber

What price drop? My place continues to go up. I'm astounded by the comparable sale prices in my nieghborhood. Wish I could sell and take the money and run, but, run to where?

Sell your place over there. For what you could get for it, clear, you could buy a 20 unit apt. complex in my town, and gross $10k/month.
Waco, TX Homes for Sale on Yahoo! Real Estate: 1-10 of 1005 listings (Listing #10).
Then live on the beach just north of Kaneohe with the mokes.

Sounds cool, except they'd be drinking Primo beer, and you'd have Dom Perignon.

[Excaliber]

Whoa, McCloud is down to 6 students? Now that is depressing...

Along with the higher prices, here in my neighborhood, I am seeing some significant changes, with mixed feeling about it all. When I bought my place some years ago this was a sleepy little place with laid back neighbors and a 'family' feeling to it all. However, it was SO 'laid back' it was kind of a dumpy area. To many people working on their cars and leaving oil containers and parts laying around when they were done. Houses needed painting, yards unkempt, plenty of old rusty cars, etc., it wasn't all that pleasant to look at. I bought my place for a song. With the rise in prices slowly but steadily it's changing to a more affluent type of home owner. Houses are well maintained now, everyone has a newish car, the neighborhood looks great. The tension in the air is also up, big time. The family feeling is disappearing. We have a neighborhood association that dictates what you can and can't do to your home, which used to be a joke. But now, you better pay attention to the 'rules', they ARE enforced. While I appreciate the nicer look and rising values, we've lost something along the way...

I sold my old house to move here BECAUSE the neighborhood was so 'uptight' about 'rules', I wanted 'laid back'. It's dejavu all over again.

[Ron61]

Ernie,

In today's paper they are talking about what to do at McCloud. The six students there don't want to leave as they don't like the little click's groups at the other schools and it would cost a lot to bus them to Mt. Shasta, yet they can't afford to keep and maintain the school for just 6 people. There latest thought which I believe could work is to let them finish out their school and graduate by doing it over the computer.
Also the amount of students in this school district has been on a slow but steady decline the past 4 or 5 years, but they still have plenty to keep the schools open. However yesterdays paper said that Enterprise, Anderson, and Cottonwood may have to discontinue their sports programs completely.

Ron

[Excaliber]

A couple of my buddies have homes in Texas, one will be leaving Hawaii and moving there. He says it's for the taxes in Texas, Hawaii is just a killer state for taxes. It's tempting, after hearing about what you can buy there for so little compared to here.

The deal killer for me? Reports of 92 degree summer days with 100% humidity. I can't handle that, gimme the trade winds and steady as she goes weather. All though, being a 'slum lord' with tenants is an interesting thought, I guess I wouldn't have to actually 'live' in Texas. Might be kind of cramped sleeping in the Cobra...

Ernie

[4RE KLR]

92* LOL

Try 110 -115* in the summer.

92* would be a blinking holiday!

[Joe Wicked]

Originally Posted by 4RE KLR

92* LOL

Try 110 -115* in the summer.

92* would be a blinking holiday!

Beat me too it.

[Ronbo]

Try 95~100 with 100% humidity, like trying to breathe hot soup...

[Bobcat]

Been through Jax when it`s been that hot .... and it can be a bear to work in that ...FL used to be part of my territory . Last summer up here in SC was also miserable with one week of 100 + and several days of 105 to 107 with humidity in the 90% range . But , this is the deep South and I wouldn`t trade it for anything ( as the saying goes .... American by birth , Southern by the grace of God ) .

[Ronbo]

Ya, a lot of the contractors down here start at the crack of dawn and wrap up by 3:00. I still can't see how the roofers work in the summer here. (they all look like concentration camp survivors) A fat guy doesn't stand a chance working outside here.

I grew up in Cleveland and got stationed down here, if I'd had a choice the first summer would have sent me running up north. (worse yet they sent me to Chicago first)

After a couple years your blood thins out and it's not as bad. When I first got down here I was amazed how laid back it was, now I know why. You can't lite a fire under anyone's butt because they can't feel it.

[392cobra]

Subject: Commentary: Klepto-capitalism

Date: Thursday, March 6, 2008





Commentary: Klepto-capitalism

By ARNAUD DE BORCHGRAVE, UPI Editor at Large

WASHINGTON, March 6 (UPI) -- The bursting of the housing bubble, which punctured the credit bubble, was a criminal enterprise at the outset, pooh-poohed at first by those who should have known better, that has now triggered a global economic crisis. The U.S. prison population is at an all-time high with 2.3 million behind bars, but the subprime con men/women are enjoying the fruits of their scams.

Global estimates of laundered funds sheltered by individuals in offshore tax havens vary between $7 trillion and $12 trillion. Yet only three postage-stamp size countries -- Andorra, Monaco and Liechtenstein -- are still blacklisted as tax-dodging havens.

The subprime mortgage meltdown caused banks on both sides of the Atlantic to write down some $400 billion (UBS puts the final banking-sector loss closer to $600 billion, which means scaling back lending by $2 trillion), and sent the dollar to an all-time low against the euro. It also put 2 million U.S. homeowners at risk of losing their homes, countless millions of others of losing 30 percent of the value of their real estate in 2008, pushed oil over $100 a barrel, and gold to nearly $1,000 an ounce.

Harvard's Lawrence Summers, a former U.S. treasury secretary (1998-2001), said subprime spawned the most serious crisis in housing since the Depression. Near worthless mortgage-backed securities were repackaged by greedy predatory operators to look like soul food for the brainless.

Collateral economic damage is huge -- and keeps growing. Diminished borrowing capacity based on a home's value affects consumer spending and cuts in to the local tax base. But so far no CEO dismissals or cuts in executive compensation, even in banks that misjudged and lost billions.

The Union Bank of Switzerland, the world's largest wealth manager, lost $19 billion (total exposure to subprime was closer to $30 billion). Singapore's "Sovereign Wealth Fund" quickly pumped in $11.5 billion, earning the sobriquet of Union Bank of Singapore. The city-state assessed UBS as a good investment based on long-term growth estimates. UBS' chairman and chief executive officer, dour-faced Marcel Ospel, ignored calls from 6,700 shareholders to resign, growled at his board -- and kept his $25 million-a-year job. Citigroup is nursing its subprime wounds by preparing to lay off 25,000 employees.

Financial Times European Editor John Thornhill, assessing why top earners in the risk business feel no pain, says, "What rankles are the undeserving wealthy who take risks with other people's money but never suffer the consequences."

Wounded and distressed, leading investment bankers moved, belatedly, to propose new guidelines on pay and bonuses to the "Institute of International Finance," a global association of banks that met in Rio de Janeiro, Brazil, this week. The initiative was also designed to encourage a fresh look at $20 million to $50 million annual compensation packages for CEOs and to discourage banks from huge cash bonuses to traders who take foolish bets to win a jackpot.

Wall Street CEOs quickly let it be known they would not agree to suspend multimillion-dollar compensation packages until subprime losses had been recovered "because it would take away Wall Street's competitive edge."

Federal criminal prosecutors are investigating whether securities firms booked inflated prices of mortgages despite knowledge of their true valuations. Rating firms are also being investigated for assigning ratings that were too high for instruments backed by subprime mortgages. Collateralized Debt Obligations were loaded with overvalued subprime -- and passed on with the Triple-A seal of sound risk.

Goldman Sachs and Deutsche Bank led a roster of banks that didn't take a bite out of the subprime apple -- but global market turbulence still hit them. Fast-talking mortgage sharks assured millions not to worry about the fine print because the value of their purchase would be up 30 percent the first year. They even advanced the money for a down payment as small as 5 percent, or even no money down.

The administration's $168 billion stimulus program doesn't kick in until the checks go out in May. Tax rebates of up to $500 for individuals and $1,200 for couples filing jointly -- or $300 for individuals who pay less than that in income taxes. All this does little to ease distressed homeowners -- but it adds to the federal deficit.

Fed Chairman Ben Bernanke told this reporter in early September the worst of the subprime crisis was now behind us. But it was just the beginning of a global financial tsunami. His predecessor at the Fed, Alan Greenspan, conceded he had seen "subprime" ripples coming but didn't think it was any big deal. In early March Bernanke moved to pre-empt Congress. He appealed to banks to forgive large chunks of mortgage loans to borrowers who can't afford to pay and/or those who owe more on their mortgages than their houses are worth.

Unless we learn from this crisis, says the English-speaking world's most-read financial and economic columnist Martin Wolf, "another will put the world economy back on to the rocks in the not too distant future." World food programs for the hungry in Darfur and other areas of malnourishment have already been hit by the hype for crop-based fuel, such as ethanol. Spurred by skyrocketing oil prices, farmers have begun switching from food to fuel, thus causing global shortages. And no one feels this more acutely than the Rome-based World Food Program that expects to feed 73 million people this year. But wheat prices soared 80 percent in the past year.

With 6 percent of the world's population, America's prosperity in recent years has been its ability to borrow $2 billion to $3 billion a day from the rest of the world in return for Treasury paper to maintain the world's highest standard of living, which, in turn, is based on conspicuous consumption at a time of growing world shortages. Clearly, a new paradigm is needed -- but it's not in the cards. We are simply told to go out and spend more. But what happens if most of us decide to send our tax rebate checks to the bank or pay down credit card debt instead of buying, say, cheap toys made in China for the kids? Or a new keyboard made in Taiwan for the PC? The law of unintended consequences beckons. Several major kicks are on the way. It is, after all, the worst financial crunch since the Great Depression. And talk about "change" won't hack it.

Some 10 million American homeowners will have no equity left in their houses by year's end, according to Merrill Lynch estimates. That can only enhance the Democrats' fortunes in November. New Deal for the 21st century? The stakes are high.

[Wes Tausend]

Originally Posted by 392cobra

Subject: Commentary: Klepto-capitalism

Date: Thursday, March 6, 2008
Commentary: Klepto-capitalism
By ARNAUD DE BORCHGRAVE, UPI Editor at Large

WASHINGTON, March 6 (UPI) -- The bursting of the housing bubble, which punctured the credit bubble, was a criminal enterprise at the outset...

...most serious crisis in housing since the Depression....

...But so far no CEO dismissals or cuts in executive compensation, even in banks that misjudged and lost billions...

...kept his $25 million-a-year job. Citigroup is nursing its subprime wounds by preparing to lay off 25,000 employees...

Financial Times European Editor John Thornhill, assessing why top earners in the risk business feel no pain, says, "What rankles are the undeserving wealthy who take risks with other people's money but never suffer the consequences."

...With 6 percent of the world's population, America's prosperity in recent years has been its ability to borrow $2 billion to $3 billion a day from the rest of the world... ...It is, after all, the worst financial crunch since the Great Depression. And talk about "change" won't hack it.

...That can only enhance the Democrats' fortunes in November. New Deal for the 21st century? The stakes are high.

Fred,

Pretty quiet response you've gotten so far, on a pretty disquieting revelation. Almost like the horror is too great to discuss. Well, "talk about 'change' won't hack it" anyway.

The above even implies that this may "enhance the Democrats' fortunes in November". Sounds like "Obama Talk" to me. But Obama is as much of a amateur business manager as GW was ...and how's that working out for us?

[Rant On]
All politics seem to be founded over who-gets-how-much of the pie. That would make sense since wealth is the basis of that which is governed, hence government. A government of rights? The right to "Life, liberty, and the pursuit of happiness" of which money supposedly can't buy ...but truly won't exist without it. The truth of this buying principle is in our DNA.

Wars are fought, almost exclusively, over percieved inequities on pie squabbles, distribution of wealth. Wars might be said to be often caused by religion. But even then, close inspection reveals the insidious my-piece-is-smaller-than-yours culprit, where one religion enjoys a higher living standard, wealth divided along reverential lines.

Distribution of wealth and war:
The American Revolutionary War: You expect me to pay taxes for what...
The US Civil War: Don't take (free) my cheap help away...
Provisional Irish Republican Army: Hey, all the protestants got the good jobs here...
Nazi Germany: We are so poor and these terrible Jews have all the money...
Everywhere except the ME: Those uncivilized greedy sand people have all the expensive oil...

It is said that the root of all evil is money. But in simpler terms, I believe it is, and always has been, the distribution of money, the unbalanced distribution of wealth, that inspires all human suffering other than natural disease. We have no known predators other than other humans ...and microbes.

That said, my greatest concern for America was a gradual shift in the power of corporate law, not only in the US, but the world at large. All evolved to unprecedented hierarchy in the name of unimpeded free enterprise. Laws that now allow, even encourage, mortgage and other white collar rip-offs. The wealth is now radically shifting. And the working class ...that's us ...gets the bill. Time to legislate a back up move if it's still possible.

At this point, I trust my government more than I do corporate power. Please, please, more government by-the-people interference. At least I get to vote. As if that helps lately.

It sometimes seems that the next presidential election won't really matter. Our fate is predetermined in various corporate board rooms and the "Hear Ye, Hear Ye!" lobbyists are sent out to the peasantry in congress.

Who's in charge here anyway?
[Rant Off]


...