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More real estate doom and gloom

jimmydean

The Official Meat of Ridemonkey
Sep 10, 2001
40,931
13,129
Portland, OR
Things will be sliding here for a while. There are so many half developed areas just begging people to buy and even a few still trying to fill out the area. I think in 2 years the unsold will drop and the newly built will stop being built, then prices can level off.
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
Why not put in, get it, move, rent, and then buy in a year or three?
Well, I'm considering that. But we'd have to rent out/sell here, wifes job, yada yada, blah, blah. I'm just not sure at this point that it makes a lot of sense for me to go back to PDX as the lowest senority mechanic to a base thats been on the choping block for a long time, that has in fact been down sized several times, never mind all the personal/finacial stuff. I think Jimmydean is right. I don't see things changing for the better anytime in the near future. IMHO there is still plenty of time to wait for when we will be in a better spot.
 

jimmydean

The Official Meat of Ridemonkey
Sep 10, 2001
40,931
13,129
Portland, OR
Well, I'm considering that. But we'd have to rent out/sell here, wifes job, yada yada, blah, blah. I'm just not sure at this point that it makes a lot of sense for me to go back to PDX as the lowest senority mechanic to a base thats been on the choping block for a long time, that has in fact been down sized several times, never mind all the personal/finacial stuff. I think Jimmydean is right. I don't see things changing for the better anytime in the near future. IMHO there is still plenty of time to wait for when we will be in a better spot.
PANG won't be around for much longer, I'm surprised it's still there now. I know most of the units have moved to some place in WA.
 

ridiculous

Turbo Monkey
Jan 18, 2005
2,907
1
MD / NoVA
Housing prices fell in 19/20 major US cities last quarter. Washington DC being the exception.

Being some one thats currently looking for a place to live there after researching quite a bit of what and how the housing bubble worked. I can tell you DC is really in truly ridiculous! Housing prices are no where near avg salary. There are countless brand new apartment buildings sitting at 1/3 capacity if that. Its starting to look more and more like China.
 

Mike B.

Turbo Monkey
Oct 5, 2001
1,522
0
State College, PA
Oh how I wish it was a buyer's market here right now. Our lease is ending in July, rent is going up if we stick around. The new rent would be the equivalent of about a $220k/30yr/5% mortgage including taxes & insurance. I've been house shopping but having a hard time even getting to see a house before it is under contract. The overall market is down a bit from peak pricing in '06 but that hasn't made it easier to get into a decent place. The most recent listing I was really interested in didn't make it 12 hours on the open market and went for full asking price.
 

dante

Unabomber
Feb 13, 2004
8,807
9
looking for classic NE singletrack
Oh how I wish it was a buyer's market here right now. Our lease is ending in July, rent is going up if we stick around. The new rent would be the equivalent of about a $220k/30yr/5% mortgage including taxes & insurance. I've been house shopping but having a hard time even getting to see a house before it is under contract. The overall market is down a bit from peak pricing in '06 but that hasn't made it easier to get into a decent place. The most recent listing I was really interested in didn't make it 12 hours on the open market and went for full asking price.
1) Find a Realtor. They often get notices before houses officially "go on the market" and can show you the house even before it's listed.
2) Find a website that lists houses in the order in which they were listed. Lowball the ones that have been around for awhile (or figure out why they aren't selling).
3) Google search new(er) listings to see if they've just been relisted. Often people will pull their house off the market and relist it at a slightly lower price so it looks like a new listing.
4) Use the fact that you don't have a house to sell to your advantage. Around here most housing bids had contingency clauses that the buyer had to be able to sell their own house first. Sellers HATE those and would probably be willing to accept your bid even if it were lower. Your Realtor might be able to tell you whether a competing bid has a contingency (or "bump").
5) Get a feel for what's moving and what's not with regards to pricing / size / markets. For us the cutoff was ~$190-200k. Everything below that was moving fast, everything above it (even *slightly* above it) wasn't moving at all. Aim for those places/prices where things aren't moving.

Just some thoughts...
 

valve bouncer

Master Dildoist
Feb 11, 2002
7,843
114
Japan
I wonder what my local bank would say if I asked for 20,000,000 yen to invest in the US housing market. You'd clean up just on the exchange rate at the moment. Anyway, dream on.......
 

Mike B.

Turbo Monkey
Oct 5, 2001
1,522
0
State College, PA
1) Find a Realtor. They often get notices before houses officially "go on the market" and can show you the house even before it's listed.
2) Find a website that lists houses in the order in which they were listed. Lowball the ones that have been around for awhile (or figure out why they aren't selling).
3) Google search new(er) listings to see if they've just been relisted. Often people will pull their house off the market and relist it at a slightly lower price so it looks like a new listing.
4) Use the fact that you don't have a house to sell to your advantage. Around here most housing bids had contingency clauses that the buyer had to be able to sell their own house first. Sellers HATE those and would probably be willing to accept your bid even if it were lower. Your Realtor might be able to tell you whether a competing bid has a contingency (or "bump").
5) Get a feel for what's moving and what's not with regards to pricing / size / markets. For us the cutoff was ~$190-200k. Everything below that was moving fast, everything above it (even *slightly* above it) wasn't moving at all. Aim for those places/prices where things aren't moving.

Just some thoughts...
Thanks Dante, appreciate the input.

1. Yep, got a realtor and we get the notices before they hit the public MLS. So do hundreds of other buyers though unfortunately.
2. The houses that are taking longer to sell are well above my price range or at least what I'm willing to spend. No desire to be house poor.
3. The private listing service from the realtor highlights the re-list properties nicely. Zillow and Trulia come in handy too.
4. People in houses tend to stay here forever before they retire, move south, etc. The more transient among the population fill the townhouses and condos. The buyers are usually coming off of rentals for our price range. The higher cost stuff going to the incoming faculty or move-up buyers may have more contingencies on the offers. From talking to the realtor who has been in the area a long time, many of the move-up buyers hang on to the old house as a rental too.
5. Above 400k, it sits quite a while. Late last year anything over about 330k was sitting. Below $325k and you better be among the first to see the place.

Selling my house in New York was a breeze (was on the market for 5 days) but we wanted to wait a short time to buy. Renting another year won't kill me but I'd like to find a less expensive rental to help sock away even more for my very healthy down payment. A 6 month extension is an option to try and time the market to when it slows down through late fall/winter. Slower market would be helpful but inventory also falls way off too so there are slim pickings.
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
Moral Hazard much?
(Reuters) - The United States sued Deutsche Bank AG, accusing the German bank and its MortgageIT Inc unit of repeatedly lying to be included in a federal program to select mortgages to be insured by the government.

In a civil complaint filed in U.S. District Court in Manhattan, the government said that defendants recklessly chose mortgages that violated program rules "in blatant disregard" of whether borrowers could make mortgage payments.

The lawsuit seeks triple damages and other penalties for violations of the federal False Claims Act.

Deutsche Bank had no immediate comment on the complaint. The bank's shares were down 2.6 percent in late afternoon trading in Frankfurt.

According to the complaint, MortgageIT from 1999 to 2009 endorsed in excess of 39,000 mortgages with principal totaling more than $5 billion for Federal Housing Administration insurance, meaning they were backed by the federal government.

The government said the defendants profited from the resale of the mortgages, even as thousands of U.S. homeowners faced default and eviction. It said it has paid out more than $386 million of FHA insurance claims and related costs, and expects to pay out hundreds of millions of dollars more.

"Deutsche Bank and MortgageIT had powerful financial incentives to invest resources into generating as many FHA-insured mortgages as quickly as possible for resale to investors," the complaint said.

"By contrast, Deutsche Bank and MortgageIT had few financial incentives to invest resources into ensuring the quality of its FHA-insured mortgages."

Deutsche Bank bought MortgageIT in 2007, the complaint said.

The case is U.S. v. Deutsche Bank AG et al, U.S. District Court, Southern District of New York, No. 11-02976.
http://www.reuters.com/article/2011/05/03/us-deutschebank-mortgage-lawsuit-idUSTRE7423LY20110503
 

Toshi

Harbinger of Doom
Oct 23, 2001
38,029
7,549

manimal

Ociffer Tackleberry
Feb 27, 2002
7,212
17
Blindly running into cactus
we may be moving to the Tucson area/region within the next year and, although the buying market is good there...i'm scared to death about selling my house here in NC. 4 homes for sale on my street that have been on the market for about a year now, priced around $130-$150k, aren't doing too well...i'm hoping to just break even
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
we may be moving to the Tucson area/region within the next year and, although the buying market is good there...i'm scared to death about selling my house here in NC. 4 homes for sale on my street that have been on the market for about a year now, priced around $130-$150k, aren't doing too well...i'm hoping to just break even
Dude, have you ever been to Tucson? I wouldn't move to that sh*t hole if my salary was doubled. Whatever they offer you, its not enough, there is no way I would move a family there.
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,514
7,056
Colorado
With pesqueeb on this one. Expect to pay for private school, which should flatten out pretty much any pay increase you will get.
 

$tinkle

Expert on blowing
Feb 12, 2003
14,591
6
Dude, have you ever been to Tucson? I wouldn't move to that sh*t hole if my salary was doubled. Whatever they offer you, its not enough, there is no way I would move a family there.
why not? w/ the newly doubled salary, you won't even notice the ransoms you'll be paying

and look me in the eye & tell me the chorizo in nc compares to tuscon
 

manimal

Ociffer Tackleberry
Feb 27, 2002
7,212
17
Blindly running into cactus
With pesqueeb on this one. Expect to pay for private school, which should flatten out pretty much any pay increase you will get.
homeschool actually...and i'll be earning, in just 3 years, what i could earn in 30 years here with only a 4% higher cost of living....not to mention the opportunity for more diverse assignments/specialty units than i'll ever get where i'm at. i love my job and my department but i'm tire of scraping by with no opportunity for advancement because of the economy. if you could take a very similar job to what you do now but with better benefits and much better pay progression....would you?
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
homeschool actually...and i'll be earning, in just 3 years, what i could earn in 30 years here with only a 4% higher cost of living....not to mention the opportunity for more diverse assignments/specialty units than i'll ever get where i'm at. i love my job and my department but i'm tire of scraping by with no opportunity for advancement because of the economy. if you could take a very similar job to what you do now but with better benefits and much better pay progression....would you?
Given all that, it would still be a toss up. Personally, I don't think I'd do it, Tucson is a hellhole, I've spent a fair amount of time on the clock down there. There is an opening in Tucson that I'm totally qualified for right now that would be a pretty good promotion, but I'm not applying for it. In my case the compensation doesn't even begin to make up for what I'd be giving up in the way of life style and the future of my family. And bear in mind, I hate living in Colorado Springs.
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
You DO care. :cupidarrow:
everyone else can ignore this post; we're having a moment:

http://www.gazette.com/opinion/beauty-117689-known-existed.html
I call:
http://www.csindy.com/colorado/the-company-they-keep/Content?oid=2151948

Late last week, after Barack Obama released his long-form birth certificate, the Gazette and Denver Post asked the same question of their readers.

Is it real? Are you now satisfied that the president of the United States was born, like Bruce Springsteen, in the USA?

More than 2,000 readers responded to each poll.

Twenty percent of the Post's respondents still had doubts, reflecting our national lunacy quotient. One in five variously believe that the moon landing was faked, aliens touched down in Roswell, The Da Vinci Code is based on historical fact, and this is the week they'll win Powerball. So this poll is no cause for concern.

Fifty-five percent (yes, 55!) of the 2,000 Gazette respondents believed the certificate is fake. That is cause for concern.

<snip>

And perhaps Gazette readers are an unrepresentative sample of the community: older, more conservative, less educated, angrier and more inclined to conspiracy theories. But maybe the town is just nuts, in which case we'd better hope our two candidates are listening to the advice of sane people.
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
Original subject related.
Almost five years after home prices peaked, they're still moving in the wrong direction.

Home values fell 3 percent during the first three months of this year, for the biggest quarterly drop since 2008, according to a new report from data provider Zillow. Even as the stock market climbs to three-year highs, and as payrolls tentatively expand, housing continues to fall in almost every U.S. metro area. Prices won't find a bottom until 2012 at the soonest, Zillow predicts, meaning American homeowners could be in for at least another year of pain.

"Home value declines are currently equal to those we experienced during the darkest days of the housing recession," Zillow chief economist Stan Humphries said in a statement. "With accelerating declines during the first quarter, it is unreasonable to expect home values to return to stability by the end of 2011."

Even though the recession officially ended in June 2009, the real estate market has yet to hit bottom. Since the peak in 2006, home values nationally are down 29.5 percent, Zillow says. Compared to this time last year, prices are down 8.2 percent nationally.

That translates into lost wealth for homeowners. When home values decline, the values of mortgages often don't. Homeowners lose some of their equity, or the stake they have in their home. When equity becomes negative, or when the value of a mortgage exceeds the value of the property, homeowners become especially vulnerable to default and foreclosure.

This condition became even more prevalent last quarter, as 28.4 percent of all single-family homes with mortgages are now "underwater," according to Zillow.

Falling home prices can create a vicious cycle. When a property falls into foreclosure, it tends to depress the values of properties around it, making those homes more likely to experience a similar fate.

Last year, nearly 2.9 million homes received a foreclosure filing, and more than 2.8 million homes got one in 2009, according to data provider RealtyTrac.

The housing market has been plagued by scandal in recent months, as homeowners and investors have filed numerous lawsuits alleging that big banks misplaced or even faked crucial mortgage documents. After it was revealed that companies that processed foreclosures signed thousands of documents daily without even reading them, potentially violating the law, some of the biggest banks temporarily halted their foreclosure proceedings last fall.

The mess has not yet been resolved, as all 50 state attorneys general are working with the Obama administration to negotiate a settlement with the nation's five biggest mortgage companies. Fines could reach up to $30 billion, The Huffington Post reported.
http://www.huffingtonpost.com/2011/05/09/home-prices-first-quarter-2011_n_859299.html
 

$tinkle

Expert on blowing
Feb 12, 2003
14,591
6
what does one have to do w/ the other?
When equity becomes negative, or when the value of a mortgage exceeds the value of the property, homeowners become especially vulnerable to default and foreclosure.
iow, people will say "**** it" & break the contract

so it seems there's a part of american that can never be fixed [e: "will never choose to be fixed]
 

dante

Unabomber
Feb 13, 2004
8,807
9
looking for classic NE singletrack
what does one have to do w/ the other?iow, people will say "**** it" & break the contract

so it seems there's a part of american that can never be fixed [e: "will never choose to be fixed]
That's easy, its that American consumers are doing what's in their financial best interest, just like corporations have always done. Except when corporations do it its called "watching out for shareholders interests" and with consumers its "greedy lazy Americans".
 

stoney

Part of the unwashed, middle-American horde
Jul 26, 2006
21,514
7,056
Colorado
I'm with Dante on this one. When corporations played by the same rules (until 1970's) it was expected that everyone would play by the same rules. Now that corporations have changed the rules, why would you not expect the individuals to play by the same rules?
 

$tinkle

Expert on blowing
Feb 12, 2003
14,591
6
I'm with Dante on this one. When corporations played by the same rules (until 1970's) it was expected that everyone would play by the same rules. Now that corporations have changed the rules, why would you not expect the individuals to play by the same rules?
b/c i'm not as cynical as dante


but give it time
 

woodsguy

gets infinity MPG
Mar 18, 2007
1,083
1
Sutton, MA
Foreclosure is not breaking a contract. The contract is you make the payments or we take your house. To break the contract would be to not make the payments but not give back the house.
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
That's easy, its that American consumers are doing what's in their financial best interest, just like corporations have always done. Except when corporations do it its called "watching out for shareholders interests" and with consumers its "greedy lazy Americans".
I'm with Dante on this one. When corporations played by the same rules (until 1970's) it was expected that everyone would play by the same rules. Now that corporations have changed the rules, why would you not expect the individuals to play by the same rules?
:stupid:

I've done a full 180 on this issue. When things first went pear shaped I was pretty vocal about my disgust for these home owners who were walking away. I still feel that this is.....morally ambiguous....but the more I have learned and discovered about what lead all of us into our current financial situation, and how difficult it has been made for people who actually want to do the right thing, the more I say fvck the banks, and fvck these dirty tax evading corporations. Hell, if I didn't have equity in my house I've come so far to the other side that I'd probably have no problems not making my note and seeing how long I could live rent free and stash cash. Its not uncommon these days for some one to squat in “their” house for up to two years before foreclosure is filed any more. You know how much money that is if you’re smart and just stick it in your savings account?
 

$tinkle

Expert on blowing
Feb 12, 2003
14,591
6
Foreclosure is not breaking a contract. The contract is you make the payments or we take your house. To break the contract would be to not make the payments but not give back the house.
semantics

can we back up & say "credit gained with false pretenses" then? surely this is false representation, also worthy of accountability
 

$tinkle

Expert on blowing
Feb 12, 2003
14,591
6
Last I checked being foreclosed upon wasn't great for ones credit. :confused:
before that
as in: how they got a $500k home w/ no $$ down on a salary of $45k AGI

while i concede it's not b&w, for a great lot it's like the kid who shoots his parents & then pleas for mercy from the judge b/c he's an orphan.

there was a TAL podcast that gave pretty even-handed coverage about a yr ago (one of their dozen or episodes on the bubble). amazes me how someone could have the means to make their payment, but walk away b/c they're underwater. would they by extension expect the bank to repossess & flip the home if it became profitable just b/c the bank found a buyer [recall it's still in the bank's name]? certainly not. that would be immoral, unethical, and of course, illegal.

'merica, **** yeah
 

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
40,137
16,532
Riding the baggage carousel.
before that
as in: how they got a $500k home w/ no $$ down on a salary of $45k AGI

while i concede it's not b&w, for a great lot it's like the kid who shoots his parents & then pleas for mercy from the judge b/c he's an orphan.

there was a TAL podcast that gave pretty even-handed coverage about a yr ago (one of their dozen or episodes on the bubble). amazes me how someone could have the means to make their payment, but walk away b/c they're underwater. would they by extension expect the bank to repossess & flip the home if it became profitable just b/c the bank found a buyer [recall it's still in the bank's name]? certainly not. that would be immoral, unethical, and of course, illegal.

'merica, **** yeah
I agree. :twitch: However, the banks and mortgage lenders, a lot of whom no longer exist, are at least equally responsible here. Who in their right fvcking mind makes loans to janitors making minimum wage for $500,000 if they have to hold the note? Nobody. But when you can package that loan into a CDO and sell it to Deutsche Bank then who gives a sh*t if there is no hope on earth that the sucker will ever pay it back? All things being equal, were I a banker I wouldn't have made either of the two loans that I got. Would you make a zero down home loan to a 24 year old newlywed and his 22year old wife, both of whom have pretty much no employment history? I sure wouldn't, cause that’s a dumb bet, but instead what happened was lenders were climbing all over themselves to float us a loan, especially sketchy ones, ARMS, balloons, etc. Our first house the lenders were all trying to talk us into figures I knew we couldn't afford, in spite of my insistence that we wouldn't take a loan that we could not afford on my pay check alone. Extrapolate this out country wide, and its no wonder at all that things collapsed. How was it that so many people couldn't draw the conclusions that my 24 year old self reached, i.e. how is an ARM a good bet, who the fvck takes an interest only? The wife and I have made good on both our house purchases, have equity and have been fiscally responsible, but near as I can tell were the exception not the rule. However, the point I'm making is that the lenders and banks who were pushing all this crap on dumb kids like me, and even dumber baby boomers who were cashing out and living beyond their means are just as responsible, if not more so because they really should have know better.