The Age of False-Bottoms in Real Estate is Here
The Anatomy of a Housing Market at a Potential False Bottom
I do a significant amount of work for distressed funds and thought this research would be interesting to share. This is only the San Diego MSA but most other MSA’s in the state look very similar. Mark
I was on CNBC several weeks back with Erin Burnett and she asked if there was any chance for the Case-Shiller to suddenly spike one month in the near-term. I said ‘no major spike — but there absolutely will be price leveling and even rising in some the hardest hit MSA’s’. It’s time to revisit this.
In my April 30th report entitled ‘Housing (bottom) Update’ I highlighted the reasons why some of the hardest hit MSA’s might do well over the near-to-mid term:
- artificially depressed supply through gov’t and bank-specific foreclosure moratoria;
- artificially low rates and temporary tax benefit;
- foreclosure mix-shift creating an artificial skew higher in reported median and average prices;
- And fleeting seasonal demand.
Essentially, everything is artificial and so should the bottom that comes out of it. I have been looking for this false bottom phenomenon to play out for months and believe it is here.
The San Diego MSA is a perfect example of a market experiencing a false bottom. It is a very interesting and unique market that I believe will show a bottom in reported house prices as soon as the next Case Shiller report. It may even report a decent sized increase in median and average house prices.
San Diego MSA – The Anatomy of a False Bottom
San Diego is not unlike most other hard hit MSA’s. Prices are down significantly, sales have increased year-over-year creating excitement and speculation, and the majority of the sales are happening at the low end. The mid-to-upper end is languishing. For various artificial and temporary reasons, there is only a couple of months supply at the low and literally ‘years’ of supply at the high.
San Diego total sales are hovering around 3k per month. This is up sharply from the lows of 18-months ago when prices were still near the highs and all of the exotic loans went away suddenly creating a sudden and violent sales trough.
But sales are nowhere near robust in a historical context especially when considering that median house prices are down 44% from the peak and rates are at historic lows. If this market was truly on the mend, sales would be much higher especially now, during the peak season. Sales actually dropped 10% from April to May.
Some will argue that low sales reflect low inventory, which I do not necessarily agree with. But, if that is the case we should see a price surge in the near-term that proves it.
Prices have also fallen sharply in the past 18-months. The sudden fall coincides perfectly with the sudden loss of all exotic loan programs in Q3 2007. Please note the series of events that took place during the dramatic house price slide from over $500k in June 2007 to a low of $280k in Jan 2009.
The 2008 surge in foreclosures shown below kept this market over-supplied in all of 2008. This accounts for much of the relentless home price slide through the end of 2008 as pictured above. Then, foreclosure moratoria beginning in Q4 2008 (below) kept foreclosure-related resale supply at a bare minimum…much less supply than demand for low priced properties.
When you combine a median price decline of nearly 50% with artificially low rates and a genuine lack of supply through moratoria, it will create support — and it did. But as noted in the first chart showing sales counts, it has not created a surge in sales.
The average present value of properties entering the REO supply pool as shown in our data below, revealed a price turn in March. We highlighted this in our April report entitled ‘San Diego Housing Market Alert’.
But because REO resales only make up only about 35% of total sales vs roughly 60% statewide, they are not as much of an influence over pricing as in other hard hit MSA’s around the nation. This may point to the loss of exotic loan programs as more of a problem for this market initially than foreclosures.
But even with foreclosure-related sales running lower than the statewide average in this market, they will still influence prices. And the shift in the value mix of properties entering the REO resale pool to higher priced properties will influence median and average house prices going forward.
Shown below — the low priced band (blue) is shrinking relative to total new REO supply from the upper price bands. As this higher priced property mix is resold, it will have the effect of lifting median and average values. In other MSA’s where the percentage of REO to total housing is much greater, the mix-shift has a much greater effect.
The following chart of monthly bank owned properties is the last look available at the pool of REO resales before they are listed with a Realtor and resold. These data are unique and totally proprietary to ForeclosureRadar.com and The Field Check Group.
At the Notice-of-Default stage, the mix shift is even more pronounced and occurred earlier. This is because the REO chart above is made up of loans that may have gone into default as long ago as a year — during the heart of the Subprime implosion. Subprime loans were lower in loan amount attached to lower priced homes generally.
The Notice-of-Default mix-shift chart below shows real-time monthly loan defaults containing a much greater number of higher loan amount Alt-A, Jumbo Prime and Prime loans on higher priced homes.
Much More Supply Coming
But before you get too excited about the prospects of San Diego real estate and put in an order for a pool of REO’s to flip or notes to work out, a wave of foreclosures is coming.
In the past three months alone, Notice-of-Trustee Sales are back at near peak levels of 2500 per month. An NTS is the second stage of foreclosure that comes 14-60 days prior to the property being taken to the courthouse and sold.
With most loss mit and mortgage mod plans known to servicers now, there is little reason to file an NTS unless in fact the property has a good change of going to foreclosure. With San Diego sales at about 3k per month, 2500 NTS per month could cause a serious supply/demand imbalance that must be absorbed for this market to become and remain healthy. This will be especially difficult considering that the peak sales season ends in August and Notice-of-Defaults (two charts down) that feed NTS, have also surged recently. Judging by the flow, recent NODs will feed foreclosures perhaps through the end of the year — that is as far out as we can see.
This NTS surge is especially troubling considering that foreclosure related supply only presently makes up approx 15% to 20% of total housing supply and Ma and Pay Organic homeowner make up the rest. With 3000 monthly sales and supply coming at a rate of 75% of total sales, that does not leave a lot of demand for organic sellers. First timers and investor can’t carry this entire market on their own. Organic sellers must be able to sell and re-buy in order to keep demand stable and strong.
Notice-of-Defaults – the first stage of foreclosure that occurs after a borrower misses 3-4 payments — have surged in the past five months. The dip down in 2008 was solely due to a CA moratorium law — SB1137 — that had the effect of kicking the can down the road.
There have been more new Notice-of-Defaults each month for the past five months than properties sold. NOD’s turn into foreclosures within 5-8 months — this is not a great sign. The new mortgage mod initiatives had better work well.
Mid-to-High end Trouble
Mid-to-high end loans and the home attached to them are where the real trouble lies in the near-term. The two charts below show the monthly new loan defaults and foreclosures for mid-to-high end properties.
Mid-to-high end NOD and foreclosure counts stand between 35% and 40% of total counts but account for only about 20% of total sales. This means that foreclosure-related pipeline supply is 100% greater than demand in this segment. This is a major supply/demand imbalance that will bring serious trouble to this market over the near-term. Especially considering that this particular foreclosure related supply only makes up approx 10% of total mid-to-high end supply with Ma and Pay Organic homeowner once again making up the rest.
In this market segment especially, first timers and investors have little impact — organic sellers need to be able to sell and re-buy in order to keep demand stable and strong.
This will promote significant house price and rent compression over time that may put in jeopardy the low-price housing stability seen today.
Jumbo REO has also been held artificially low due to moratoria. With only 300-400 units entering the resale pool each month since the moratoria kicked in and more exotic and longer-term loans left over from the bubble years, the mid-to-upper end market has not gone through the same tragic price melt-down as the lower end — yet.
Lastly, third party professional investors/buyers at San Diego courthouse foreclosure sales have not stepped up what they are willing to pay like the retail buyer has. Price declines in this segment have decelerated and may show stabilization soon, but after only one month it is too early to call.
With rents tumbling and the primary purchasers at the courthouse foreclosure auctions being professional investors, I think this chart is very telling.
Bottom Line: Headlines are about to get wild, as the age of false bottoms in real estate is upon us.
At Field Check Group, we do highly granular work on every CA MSA and other states upon request.
Best Regards,
Mark Hanson
Mark@TheFieldCheckGroup.com
Data provided to Field Check Group Real Estate & Finance by ForeclosureRadar.com
June 9th, 2009 at 3:17 pm
Hi MM and all,
There’s a poster over on Mish’s board who has been spot on regarding much of this recent economic downturn and is a commercial real estate broker.
He’s saying if you really want to buy RE that the time is coming, but to wait until rates are at 18%, and bring cash. He’s also predicting values will be 50% to 60% down from where they are now in the less hard hit MSA’s.
Is that likely in your opinion as well?
June 9th, 2009 at 3:26 pm
Noz, I am looking to buy but I’m not in a rush. I would love to own a house but I don’t HAVE to have one, so therefore, I won’t get into a bidding war with someone or fall in love with a house that is over my budget.
Hopefully, prices will fall another 10% or so by the end of this year. That would be great for me as I hope to buy before year end. I’m looking for homes under $400,000 in the Anaheim area, and right now it’s difficult to find one that’s nice without having to fight someone over it.
June 9th, 2009 at 7:57 pm
Hi Mark,
your charts, are like, totally GRANULAR dude!
June 9th, 2009 at 8:02 pm
Mark, just to let you know, your site doesn’t work well with Firefox.
June 9th, 2009 at 9:01 pm
Mr Wonton, just to let you know, you will need to provide specific information to be useful. Imagine if you called Dell customer service with ‘my computer doesn’t seem quite right today’.
With specific information, maybe someone on the list can help you.
It works fine for me.
Mr Firefox
June 9th, 2009 at 9:24 pm
Wonton.. very funny! Help me stop laughing..
June 9th, 2009 at 9:27 pm
Wonton, you can even buy now? When the heck will you be able to aford? I told you I may buy faster than you do (again)!
June 9th, 2009 at 10:26 pm
Wonton:
I hear you. Same here. The selection out there is pretty pathetic right now. I can’t even imagine what was running through peoples’ minds during the “Stupid” years while outbidding each other.
June 9th, 2009 at 10:36 pm
All kidding aside.. we need to go back to basics. Wonton, buy what you can aford, don’t make the mistake I did… but to think bottom is at end of 2010, time will proove you otherwise.. make sure you’re ok with living in that house.. for a long time, and that your job is safe!
June 10th, 2009 at 6:33 am
Yes Yes…price is going to keep falling….
O C’mon give me a break. All these sites like patrick..and yours go over examples from two,three places from california, las vegas, florida etc and try to generalize it.
95% of the country is not in Sanfransisco, las vegas of near the florida beach and price has been stable over the last few months.
Try buying a house in midwest, norteast, south etc and you’ll see that pices are flat or in most case steadily increasing.
June 10th, 2009 at 8:08 am
Arnold, I have both firefox and internet explorer, so I use explorer when I get on here. A few times when I used firefox, the page is cut off. For example, right now the last message is 114 from “really”. If I use firefox, I might see your message 109, as the last message and even your message is cut off mid way. Then nothing after that. If I continue to use firefox, I would think that the board is dead and no one is posting after yours…
June 10th, 2009 at 8:26 am
Back to my 64K question… on why banks are paying back the TARP $?
a.) They don’t want anymore regulations, CEOs want their big pay?
b.) Now that they’ve sold more stocks, after many financial stocks went up 100% to 400%, since march 9th they can aford it?
c.) Their financial situation is much better than anticipated/stress tested?
d.) Do they want to pay it back, let stocks drop again, and do TARP 2 (or really same one, but borrow again, repeat? another bounce, sell some more, pay it back?
Looks like I’ve got my answers:
a.) Another Missed Opportunity: Obama Retreats on Wall St. Compensation
b.) Citigroup expects to convert into common stock a total of $58 billion of preferred stock and trust preferred securities, assuming full participation in the swaps.
d.) ..will be this fall…
June 10th, 2009 at 11:07 am
“Wonton, buy what you can aford, don’t make the mistake I did… but to think bottom is at end of 2010″
I’m trying not too, ex_owner. I too think the bottom won’t come until the end of 2010, but you never know for sure. So I will keep on looking and buy when the right time comes… if ever:))
June 10th, 2009 at 2:21 pm
Use the tax code to encourage investment, and I think we will all be surprised with how quickly a bottom forms! We will see housing move from weak hands to strong hands, similar to what takes place in the stock market during times of uncertainty!
June 10th, 2009 at 5:39 pm
SistaSue’s clients are snapping up “Single Family Homes in the subs of SD in the 425k-469k range” and outbidding all comers – HOORAY!!
First of all SistaSue, please tell us how many of your clients you sold similar homes to 4 years ago for $700K. I bet they are ecstatic now regarding that purchase. Great job SistaSue! And your clients are GENIUSES! What an investment!
Let’s check back in a few yrs when these same homes are selling for $350K and see how SistaSue’s new clients are feeling then.
June 10th, 2009 at 6:05 pm
Wonton, see the same issue with Firefox; paste the URL into IE and it works fine.
Maybe Mark’s webmaster will take up the challenge.
June 11th, 2009 at 9:51 am
Regarding future alt-a and option arm resets, those loans have high margins that can cause the rates to spike when reset. To avoid some refinance issues or potential defaults, the servicing lenders could offer a simple modification at a reasonable cost to lower the margin before the loans reset.
June 11th, 2009 at 2:38 pm
Noz and Benzy,
Thanks for the bantor. I enjoyed reading it all. It’s true that all of us can be internet wealthy but some of the people here probably are in fact well off. I am now in a rental after a lesson in real estate and it is not too hard to save quite a bit by renting. $60k a year seems like a lot, but two decent incomes and no kids (assumption) could make that possible. My wife and I certainly don’t make enough to save $5k a month but we have two kids and two car payments and are saving around $3k a month. When you don’t have property taxes, car payments, home maintenance and credit card debt to deal with, saving happens a lot faster than many people probably realize, myself included.
June 11th, 2009 at 5:23 pm
Really – I would hazzard to say that most of the people who read this blog reside in a bubble state. If you live in Kansas why are you even reading this blog? I would imagine your homes simply sell at cost + labor, land is damn near free!
June 11th, 2009 at 7:36 pm
SistaSue..are they chinese by any chance?
June 12th, 2009 at 10:07 am
I am also an ex-owner now renter & ,although I don’t like the idea of irresponsible people getting a break, the smart move for the banks right now is principal reduction. With high end homes ready to implode & most of those owners able to pay, principal reduction may be the only thing that keeps them from walking away. I think that most people would stay if the bank met them half way between what they owe & current market value, because most people at the high end are more concerned about their credit and usually have more invested in the home. They would accept a deal & stay, saving both the bank & owner money. If the banks let all those homes turn to vacant REOs, it will cost them much more in the long run. My cousin just purchased a bigger, nicer place prior to letting her overpriced home go back to the bank. She is a CPA so she knows her credit will take a hit, but she already has her new home secured. She had no idea that her place would be so devalued when she bought it and walking away is the smart thing to do now. She doesn’t feel obligated to honor her commitment & endure such a loss when she feels betrayed by the entire financial system. I would imagine many high end owners echo her sentiments.
June 12th, 2009 at 10:54 am
Sold2Soon,
I too am an ex owner now renter but I don’t agree with you that PRs would save the bank’s more money. It would have helped me, and I would have stayed if they would have split the difference on the underwater amount. But in a lot of cases, PMI should help to offset some of the losses they are taking and once they start offering PRs, everyone (and I mean EVERYONE) will have a hand out, not just people who are on the verge of walking. Even though they would likely save money on situations such as mine, they would lose money overall. And really, all they care about is the big picture, not individual loans or situations.
June 12th, 2009 at 11:14 am
Awww, poor Arnold Layne took my comments personally and decided to retort with a childish personal attack. Methinks you’re a tad too sensitive, Arny. What’s the problem – did the disparaging realtor comments cut a little too close to home?
Guess what, Mister “I’m no Idiot” as you optimistically (and inaccurately) describe yourself – I’m not a renter but an owner. Mortgages paid off, however, and properties bought during the mid 90’s bottom, among a few others inherited.
You speak of class, pissant, as if you know something of it? You are right about me being a bottom feeder though – I will be cherry picking quite a few prime properties in the coming years. Good luck with your purchase this summer, I wish you nothing but the best!
June 12th, 2009 at 11:30 am
As for me, I will wait & see how far those high end homes drop. I would love to own a “mcmansion” with property & a view on the outskirts of town for around $300k. It will be way more house than I need & be more to clean, heat & cool, however, with the money I save, I will hire a maid & convert to solar to reduce energy costs. Or maybe I will just buy a couple of 3bd 2bth with cash at that point. HA! Just a fantasy for now, but may become reality if the banks continue on their current path.
I have watched the house down the street foreclose twice, then short sale. Sold for $560k(2005), $450k(2007), 374k(2008) then last month for 235k(asking $269k). This house sold for $260k new in 2001. Homes around $200k are encoutering bidding wars here & this one sold for $30k under asking at $235k. Shows where the cutoff is in rent return/investor properties.
June 12th, 2009 at 2:03 pm
Sold2soon… you’re probably an ex_owner cause you’ve sold close to the top? If you feel bad – just give back your profit to the new owner that you’ve sold to…and I hope your CPA sister doens’t get busted for fraud.. (GREED IS STILL ALIVE!)
PartyBoy.. you’ve got it.. and I’ve mentioned it too before… once someone gets a PR..everyone will want one! Banks will not do it – AND the gov (us ~ taxpayer) can’t and won’t!
June 12th, 2009 at 2:18 pm
It’s going to be hilarious to see your CPA sister (I mean cousin) walking for the second time in two years! her credit should/will go to 300!
June 12th, 2009 at 2:24 pm
Anyone buying a home 1 year or less prior to stoping payments/forclosure on their previous primary home should be investigated!
June 12th, 2009 at 6:16 pm
EX-
everyone may want a PR but everyone wouldn’t get them -just like loan mods. Keep in mind the only ones getting mod is the ones who aren’t paying (and possibly the stupid)- that hasn’t caused a huge influx of non payers. PR is between the banks and the buyer not you- if your government gives the banks money to fund them- then hate your gov’t.
BTW- how do u know sold2soons cousin committed fraud? I know someone who did the same thing- thats the banks fault- you don’t let people commit crime and then cry “crime”.
1 question and don’t get mean – isn’t all this so called money the bank would lose- just on paper? Are they claiming the intrest payments in the future as profits?
June 12th, 2009 at 11:22 pm
I don’t understand why people believe we should give current homeowners principle reductions? Why the hell should they be given freebees for making a mistake they most likely went into head first?
June 13th, 2009 at 12:12 am
Again with the PR stuff. Seriously, you really want to give the government the power to force banks to lower principles? Just exactly where do you think this right comes from?
Again, I don’t have a problem with banks voluntarily lower principles. I wouldn’t like it, but I’d respect their right to do so. But they should not be forced.
June 13th, 2009 at 7:38 am
I don’t think the gov’t should have gotten involved at all. Too bad they did – they just made it worse. PR is between the banks and the buyer only. However, the gov’t gave the banks money because they supposedly didn’t have any. That money is not being spent the way it was intended.
Look I am for anything that will help the economy- If someones got a better idea then lets hear it.
June 13th, 2009 at 7:46 am
Wonton.. I want the bank to make that decision for themselfes.. and leave the gov (us~taxpayer) out of it!
Ideas? I think we need to let free market dictate, it has always worked out… maybe Wow in California… can bring some input?
June 13th, 2009 at 8:04 am
“I want the bank to make that decision for themselfes.. and leave the gov (us~taxpayer) out of it!”
ex_owner, I agree with you on this. Absolutely!!
June 13th, 2009 at 8:59 am
Hi MM,
I concur with your results. I cannot understand how the general public can think we are out of the woods, when we still have a huge wave of unemployment to hit us and have yet to see the next wave of loan re-sets to hit the market.
Also, since May 1st of this year, wholesale lenders are controlling the appraised value of the properties that they are trying to sell, refinance, or dump by “owning” appraisal management companies. This is why there are multiple offers. The banks are controlling the “appraised list price”, then let the feeding frenzy go crazy. This rule that has happened since May 1st is the new HVCC compliance rule. Its intent was to keep brokers from being able to pick and choose the appraiser they want to use. What has happened is brokers now have to use appraisal management companies. So the banks bought the major appraisal management companies, and have shut the door on any other companies being excepted on their list, along with individual appraisers………..the result, the banks are controling their loss margin.
Yikes!
Appraiser LB
June 13th, 2009 at 11:27 am
I don’t like the idea of PR, however I see it as a necessary step to end this crisis more quickly so we can begin a recovery. I certainly don’t want the government involved because then there would be no control over who qualifies & I don’t think they should hand out PR like government cheese. Sure everyone would want PR, but the banks could set strict standards on who qualifies. It would stop many in the high end homes from walking away. The losses in this segment will be much greater. There are less high end buyers to purchase the wave of REOs, unless they do as my cousin did, securing her new home before walking from the first. I’m not condoning her actions, just explaining that people with money & good credit have options. Fraud is not a concern because she followed expert advice from someone who did it 15 years ago & is still walking the streets unscathed. Is it fraud, probably. Will she get caught, pobably not. I used to get upset about all the fraud, bailouts & blame, but now I would just like it to end so I can buy a home & get on with my life. If “strategic PR” will help end this mess, then I am all for it. I’m tired of seeing dead lawns & vandalism. I don’t want to buy a nice home surrounded by rot & decay, so keep people from walking away if they can afford to stay. Most upside down owners are victims of the system, not criminals. I don’t feel sorry for the ones who lose their homes, but I don’t blame them either, they are merely pawns in this game. Regardless of their morals, if the banks let people who can afford to stay walk away, the housing crisis will be much worse than we have seen and it’s effects on the economy will be greater than we have already experienced, IMO.
June 13th, 2009 at 3:01 pm
Sold2soon,
If it’s ok to buy another home, before or just about to forclose on existing home.. then I say it’s ok to let ex-owners come in sooner! That will be your quick fix (VOLUME OF BUYERS), not the gimicks that the “ones can pay” do.. remember without volume, this “supply and demand” model.. IT’S GOING DOWN further(in price).
The 8k, soon 15K (gov intervention).. it’s going to run out, get us broke, and interest rates only going higher!
The reason PR doesn’t work, it’s two reasons:
- everyone will want one (and stop payment to get one)
- the people that would get the PR have learned nothing (we’re going down to a bigger hole..down the road) and the rest of the nation may completely act unexpectedly toward credit, and contribute to ruin our system further(what ever is left of it).. no one will ever pay down a mortage, cc, car payment..etc.. WE’RE DONE!
June 13th, 2009 at 3:04 pm
I’m not advocating to reduce the 3 year wait on FHA loans to 1 year (even though it may make sense..)… because that that would keep the prices high, and they need to go lower!
June 13th, 2009 at 3:47 pm
Ex- why 1 year for FHA? you aren’t buying now are you? you just said the prices are still dropping. That makes no sense. You are against PR because you wont get one-you are against anything that doesn’t benifit you specifically. geez just say it.
“the people that would get the PR have learned nothing (we’re going down to a bigger hole..down the road) and the rest of the nation may completely act unexpectedly toward credit”
Really you don’t think they have learned anything? the ones that are left in this are the responsible ones-they are still paying- they got caught up in some sort of bankers/investors greed fest.
- I am sure if thier lender disclosed that they let everyone qualify and in 3 years those same ones will default leaving the street a ghost town- the responsible ones would not have bought.
Just keep in mind that only solving your problem will not help the masses or you in the long run.
June 13th, 2009 at 4:33 pm
Government involvement is necessary in this case. It should have been an oversight regulator from the start so shady homeowners, Realtors, and Wall Street types didn’t do what they did.
Of course the problem is this:
In this country, people are too stupid or lazy to demand oversight and BE INVOLVED in the process….as any proper functioning democracy should be run. The biggest problem is that the corruption is at the top too. Let’s not think for a moment that government officials and groups were in the dark about Wall Street, Main Street, and the whole thing. They just sat back and collected the fees, taxes, and monies gained on RE.
People in this country are constantly whining and bitching about how they are getting shafted….yet they do nothing about it. Nothing. And then when the government gets involved, we whine as to why they are getting involved.
So what the hell do people want in this country? If you all care some much about getting the job done right, get involved and start these organizations and groups that you claim you have a right to since this is a “Free” country. Change your government…drastically…not simply by voting one day every 4 years and think that’s it.
But of course, we’re all too lazy to do that now aren’t we…we want everything to be on autopilot….and guess who will do that for you? The government.
Again…principle reductions MUST NOT HAPPEN. People who are over their heads need to lose their homes. And prices MUST come down.
June 13th, 2009 at 6:07 pm
bought at the wrong time- I agree with you, only the responsible ones are left & throw them a bone before they are gone too.
ex-owner-
I agree that prices need to drop further, especially at the high end, but that will occur due to tighter lending practices and the fact that most people can’t qualify for a “traditional” loan.
I wouldn’t have a problem with the banks excluding a buyer’s foreclosure, if they can qualify otherwise.
I am just worried that this next wave of foreclosures is going to be a tsunami and how will that affect our failing economy? If the banks can stop it or even blunt the impact they should. Instead, they will wait until it is too late & ask for more money from us, the taxpayers.
June 13th, 2009 at 6:49 pm
noz can you clarify this :
“Government involvement is necessary in this case”
“The biggest problem is that the corruption is at the top too. Let’s not think for a moment that government officials and groups were in the dark about Wall Street, Main Street, and the whole thing. They just sat back and collected the fees, taxes, and monies gained on RE.”
so you want the gov involved- even tho they are corrupt?
no really i am not being sarcastic, i think i am too stupid and lazy to understand. (ok that was sarcastic)
June 13th, 2009 at 8:07 pm
“I don’t feel sorry for the ones who lose their homes, but I don’t blame them either, they are merely pawns in this game”
They’re players in the game.
June 14th, 2009 at 2:11 am
bought at the wrong time:
I said government REGULATION…not government MONEY.
Government is compartmentalized. Not all people in the government are corrupt of course.
The current situation in housing, banking, and money has gotten so out of hand that a certain amount of exposure of the inner workings of the corruption scheme has peeped through.
This has exposed the bankers, the RE industry, Wall Street, people on the street, and government’s own action/inaction and charade it plays with everyone through the biggest of all scams…the Fed.
People in this country ARE lazy. This sh^t is going down in front of their faces yet we don’t see an uproar, we don’t see people on the streets demanding change…not just through piss-ant ways like voting. That’s a joke.
This is due to two reasons…one being that a good portion of the population are cut from the same cloth as the corrupt bastards in these industries and organizations. So for them this crap only helps them get wealthier quicker.
The other reason is somehow the current mental structure of people is they simply don’t care…they want everything to be done for them without thought or effort…i.e. lazy. Yet when it is done, it’s not what they want…yet they don’t want to become involved to fix the problems.
Nothing in this country is going to change or get better until people really stand up for what they believe in with conviction and real effort. Democracy is a hard gig to run…it’s a full time job for every person in a democratic country. This ain’t no democracy I can tell you that.
June 14th, 2009 at 6:56 am
Mark,
Any opinions about the impact of (yet another) 90 day CA moritorium?
July 5th, 2009 at 8:56 am
Mark,
phenomenal insight. You took everything that I was thinking and more and spelled it
out graphically and in a well written manner. Sacramento has really shown a false bottom side of things as we have 57% homes sold in under 30 dom’s. My buyers have written as many as 40 offers before they could actually get an acceptance. Demand is high and inventory in that range is low but my belief has been due to moratorium only. I have several reo broker friends that say they are getting several new listings in the coming months and if they are all plopped on out market will revert to 1 year ago when inventory was saturated sale to list price was below list. Prices have still dropped without an abundance of inventory. 18 total million + sales in placer county this year and price per square foot 224 while list prive per square foot 400 range. High end foreclosures are coming still. High end sellers traditional cannot compete with that disrepancy in price per square foot. Lastly at some point the banks will have to allow those who short sold a property to buy again or we will run out of buyers completely. As it is some that are in the market should not be. In the 80’s people short sold and bought again. Jobs are hard to come buy and those that are nervous about work won’t buy. I have had more than one client lose their job after purchase or take severe salary decrease. If they foreclose on an FHA loan I originated it is on me as an originator. My rating or companies rating with HUD goes up and we can put in jeopardy of losing our abity to do FHA 70% o our companies closing now. I don’t think most originator understand this. Thank you for your wonderful posts. I will be subscribing.
November 23rd, 2009 at 10:53 am
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February 18th, 2010 at 2:53 pm
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March 30th, 2010 at 1:48 pm
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June 24th, 2010 at 3:41 pm
Nice Post. Today the news reports that new home sales plunge again after expiration of the tax credit. I am afraid that this type of news will dominate the industry for years to come.
July 2nd, 2010 at 6:47 pm
How did you get to be this good? Its amazing to see someone put so much passion into a subject. Im glad I came across this and Im glad I took the time to read on past the first paragraph. You’ve got so much to say, so much to offer. I hope people realise this and look into your page.