You guys check out the stats on bubbleinfo?

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Submitted by flu on December 2, 2012 - 6:03pm

Submitted by flu on December 2, 2012 - 6:05pm.

Things ain't looking better in CarmelV

http://www.bubbleinfo.com/2012/11/27/pea...

Submitted by AN on December 2, 2012 - 6:38pm.

You can look at redfin for those data. I did just that earlier today and for my area in July 2011, there were over 160 houses for sale. Today, there's 25. That's a massive decline. Too bad redfin doesn't have data back further. Would be interesting to see what supply was like at the peak. Price everywhere I look is up as well.

Submitted by bearishgurl on December 2, 2012 - 8:42pm.

This link was in JTR's article ... these tips by local Broker Kris Berg are so relevant for today's buyers:

...Multiple offers. Aargh! I have been on both the sending and receiving side too often lately. And believe me when I tell you that “fun” doesn’t begin to describe it, unless you consider watching the hopes and dreams of a dozen first-time buyers being extinguished in casual, reply-to-all fashion to be a real laugh fest.

So what is a would-be buyer to do? There is no magic formula to getting your offer accepted in a multiple situation, of course, but there are some things you should consider in order to have a fighting chance.

1. Do NOT wait until you find your dream home to sit down with your agent and go through the contract. You won’t have time. Do a dry run before you start looking. Familiarize yourself with the forms and the process. That way, when the time comes, you will be ready to point and shoot. Speed counts.

2. Do NOT wait until you find your dream home to begin considering how nice the neighbors are, how great the local school test scores are, and how competitive the prices at the nearest dry cleaner might be. You won’t have time. While you are driving the commute route in the morning, the evening, and on weekends just to “make sure,” while you are canvassing the neighbors about barking dogs and other demographics, and while you are polling your friends and coworkers about the merits of homeownership in light of recent events in Syria, someone else has purchased the darn house.

3. Do NOT wait until you find your dream home to submit all of your documentation to a lender. New listings – the good ones – last hours, not days or weeks. And no one will look at your offer without a solid pre-approval letter tethered to it.

4. Comps, schmomps. Of course you need to understand neighborhood values and comparable sale prices. But do not forget that we are in an (albeit gradually) appreciating market. Granted, there are some external unknowns that may impact our real estate market (rising interest rates, fiscal cliffs). But, for the foreseeable future, prices are not going down. More to point, when there are many, many offers on a home, offering below asking price is not a good strategy, because the fact that this home at it’s current price and condition has attracted numerous interested buyers should tell you something about perceived market value. You aren’t going to steal it. Either you want it or you don’t.

5. A home is worth what it is worth to you. Let me explain. I recently had clients ask me what the “right” price was for a home they were interested in, what it was “worth” – this, a home that already have four offers. A home is ultimately worth what a buyer is willing to pay, and with multiple offers, it will be worth something different to different people. The “right” price in a multiple situation is the price at which you would be happy to consummate the purchase if selected but would be comfortable sleeping nights knowing you gave it your best if your aren’t. In other words, take your best shot. You are not operating from a position of uber-strength here. The whole “let’s leave a little room for negotiating” strategy is not necessarily the best strategy in multiple offer scenarios, as you may never get the chance to don your Donald Trump hat.

6. Do NOT muddy your offer with stupid stuff. If the seller says that their washer and dryer do not convey, do not write an offer asking for the washer/dryer, the pot rack, the sectional sofa and the family schnauzer. And give them stuff that doesn’t cost you anything – shorter timeframes or a larger deposit. Sometimes, it comes down to the devil being in the details.

7. Pick a good – no – a GREAT agent. I cannot emphasize enough the importance of having a seasoned, experienced agent on your side. You see, a whole lot of stuff goes on behind the scenes. A great agent is lobbying for you – groveling, even, on your behalf. They are talking to the listing agent (I know; it’s crazy) — about the seller’s expectations, wants and needs, and about the nature of the competing offers before writing the offer so that yours might have the best chance of standing out. They are following up after submittal – to confirm receipt, yes, and to answer questions and generally ensure that, worst case, you get a counter offer. It is their job to try and keep you in the game. And the offer has to be well written. As a listing agent, I am always amazed at the offers I receive that are incomplete or incorrectly filled out. I am amazed at how many offers mysteriously show up in my inbox with no warning – no call or communication from the agent prior to or after submittal. This kind of stuff puts a buyer at a disadvantage, because no listing agent wants to work with a buyer’s agent that appears to be less than competent. They are going to have to live with them for the next 30 to 45 days...

IMO, ALL are excellent suggestions!

http://www.sandiegocastles.com/sandiegoh...

Submitted by carlsbadworker on December 2, 2012 - 9:18pm.

We are probably at the beginning of the next CA RE bubble.

Submitted by JohnAlt91941 on December 2, 2012 - 10:44pm.

carlsbadworker wrote:
We are probably at the beginning of the next CA RE bubble.

In your dreams.

Submitted by scaredyclassic on December 2, 2012 - 11:20pm.

well. maybe a bathtub fart bubble?

Submitted by carlsbadworker on December 3, 2012 - 12:41am.

JohnAlt91941 wrote:

In your dreams.

Nightmare, you mean? Rising price isn't doing any people here any good because I haven't know any flipper here yet. You have to be a seller to benefit. I am just talking about the range of possibility, and this is a big one.

Even Economist is talking about "big long" for hedge funds in property market. CA is a safe bet with population growth.

Submitted by flu on December 3, 2012 - 1:55am.

Need to mobilize more money.....Lol....

Submitted by spdrun on December 3, 2012 - 7:30am.

Problem is that CA has chosen to accommodate overleveraged bum-losers and do everything to keep them in "their" homes. In a just world, they would be in the foreclosure process as we speak.

Submitted by carlsbadworker on December 3, 2012 - 9:09am.

Overleveraged bum-losers are actually doing great and could be the seed of the next RE bubble.

Bruce Norris recently told a story happening in Moreno Valley, a person owed $250K on a 2-bedroom house. It went for $57K to one of the Norris Group’s investors, and the owner was given $25,000 to agree to the transaction. After closing costs, the lender netted $23 grand. But the owner who was current on the payment had $25 grand and was able to go buy another house right away since he was just given the money.

And then Bruce gave an example of someone who bought a house back in February for $205,000. This same house has already gone up to $285,000. When they tell this story to their friends who did not receive an $80 grand increase for anything and they began thinking they need to buy something, eventually that's how the CA RE cycle runs. It almost never stays in a fair value because you will get people migrate into the state when the RE price is rising rather than the other way around. As a rational person, I cannot understand this but that's how the process goes.

Submitted by bearishgurl on December 3, 2012 - 9:16am.

spdrun wrote:
Problem is that CA has chosen to accommodate overleveraged bum-losers and do everything to keep them in "their" homes. In a just world, they would be in the foreclosure process as we speak.

spdrun, don't blame this "squatting into oblivion" phenomenon on "CA."

This is largely due to the fault of "lender malaise." And where ARE these lenders? MUCH more often than not, they are located out of state.

If you were successfully able to poll residents of FL, AZ and NV, for example, who managed to "squat" more than 24 months before being foreclosed upon, I think you might be shocked :=0

And the situtation has been infinitely worse in your neck of the woods where foreclosure requires a court order.

For a defaulted property owner/occupier residing in NY, they have been living a "squatter's dream" in recent years.

Submitted by flu on December 3, 2012 - 9:18am.

carlsbadworker wrote:
Overleveraged bum-losers are actually doing great and could be the seed of the next RE bubble.

Bruce Norris recently told a story happening in Moreno Valley, a person owed $250K on a 2-bedroom house. It went for $57K to one of the Norris Group’s investors, and the owner was given $25,000 to agree to the transaction. After closing costs, the lender netted $23 grand. But the owner who was current on the payment had $25 grand and was able to go buy another house right away since he was just given the money.

And then Bruce gave an example of someone who bought a house back in February for $205,000. This same house has already gone up to $285,000. When they tell this story to their friends who did not receive an $80 grand increase for anything and they began thinking they need to buy something, eventually that's how the CA RE cycle runs. It almost never stays in a fair value because you will get people migrate into the state when the RE price is rising rather than the other way around. As a rational person, I cannot understand this but that's how the process goes.

+++ding ding ding...

Submitted by Blogstar on December 3, 2012 - 9:47am.

squat250 wrote:
well. maybe a bathtub fart bubble?

In realtor speak a bathtub fart is called a jacuzzi, squat250. And when people are ready to believe it(again) we will have a bubble.

Submitted by bearishgurl on December 3, 2012 - 11:15am.

carlsbadworker wrote:
Overleveraged bum-losers are actually doing great and could be the seed of the next RE bubble.

Bruce Norris recently told a story happening in Moreno Valley, a person owed $250K on a 2-bedroom house. It went for $57K to one of the Norris Group’s investors, and the owner was given $25,000 to agree to the transaction. After closing costs, the lender netted $23 grand. But the owner who was current on the payment had $25 grand and was able to go buy another house right away since he was just given the money.

And then Bruce gave an example of someone who bought a house back in February for $205,000. This same house has already gone up to $285,000. When they tell this story to their friends who did not receive an $80 grand increase for anything and they began thinking they need to buy something, eventually that's how the CA RE cycle runs. It almost never stays in a fair value because you will get people migrate into the state when the RE price is rising rather than the other way around. As a rational person, I cannot understand this but that's how the process goes.

The MO of the "Norris Group" sounds "strangely similar" to the one a (well-connected) Chula Vista family used last year, which I described here:

http://piggington.com/shortsale_flopping...

http://piggington.com/shortsale_flopping...

These "enterprising homedebtors" managed to successfully strip ~400K of debt (incl late chgs) from their (prime) property and "squat" for 28 mos by getting a RE agent (relative) to "find" a "straw buyer" (other relative, lol) to purchase their property deeply short and then "rent" it back to them.

And they never even had to move or file for BK!

The ongoing "lender malaise" we have been seeing in the last 5+ yrs is fueled by GOV payments to them for sitting on their hands. This IS the cause of all the SS fraud being perpetuated on taxpayers and surrounding homeowners, IMO. And the fact that many of these lenders and 2nd TD "investors" are located out-of-state makes it easy for local agents and their "sellers" to perpetrate these kinds of fraud undetected.

Submitted by CA renter on December 3, 2012 - 8:06pm.

flu wrote:
carlsbadworker wrote:
Overleveraged bum-losers are actually doing great and could be the seed of the next RE bubble.

Bruce Norris recently told a story happening in Moreno Valley, a person owed $250K on a 2-bedroom house. It went for $57K to one of the Norris Group’s investors, and the owner was given $25,000 to agree to the transaction. After closing costs, the lender netted $23 grand. But the owner who was current on the payment had $25 grand and was able to go buy another house right away since he was just given the money.

And then Bruce gave an example of someone who bought a house back in February for $205,000. This same house has already gone up to $285,000. When they tell this story to their friends who did not receive an $80 grand increase for anything and they began thinking they need to buy something, eventually that's how the CA RE cycle runs. It almost never stays in a fair value because you will get people migrate into the state when the RE price is rising rather than the other way around. As a rational person, I cannot understand this but that's how the process goes.

+++ding ding ding...

Sounds like fraud to me.

Submitted by outtamojo on December 4, 2012 - 12:18pm.

CA renter wrote:
flu wrote:
carlsbadworker wrote:
Overleveraged bum-losers are actually doing great and could be the seed of the next RE bubble.

Bruce Norris recently told a story happening in Moreno Valley, a person owed $250K on a 2-bedroom house. It went for $57K to one of the Norris Group’s investors, and the owner was given $25,000 to agree to the transaction. After closing costs, the lender netted $23 grand. But the owner who was current on the payment had $25 grand and was able to go buy another house right away since he was just given the money.

And then Bruce gave an example of someone who bought a house back in February for $205,000. This same house has already gone up to $285,000. When they tell this story to their friends who did not receive an $80 grand increase for anything and they began thinking they need to buy something, eventually that's how the CA RE cycle runs. It almost never stays in a fair value because you will get people migrate into the state when the RE price is rising rather than the other way around. As a rational person, I cannot understand this but that's how the process goes.

+++ding ding ding...

Sounds like fraud to me.

It IS fraud, spoken causually because that is the way business is done these days. Pity anyone
looking to buy a place to live these days, the wink wink crowd gets all the pretty shiny places at 2008-2009 prices while the common man gets to tour fixers at full market price.
I am starting to wonder now, how much inventory is held by samll time investor groups along with big time hedge funds. I hope it is not a lot, because hedge funds have a tendency to piss and poop on everybody else.

Submitted by bearishgurl on December 4, 2012 - 12:28pm.

outtamojo wrote:
. . . I am starting to wonder now, how much inventory is held by samll time investor groups along with big time hedge funds. I hope it is not a lot, because hedge funds have a tendency to piss and poop on everybody else.

It IS a lot and there WILL be a lot more of these types of deals in the very near future, IMO.

See: http://piggington.com/as_predicted_frann...

Submitted by carlsbadworker on December 4, 2012 - 2:16pm.

outtamojo wrote:
I am starting to wonder now, how much inventory is held by samll time investor groups along with big time hedge funds. I hope it is not a lot, because hedge funds have a tendency to piss and poop on everybody else.

I think there is a lot. DQNews said 28% of the houses are bought by absentee buyers in SoCal. Keefe, Bruyette & Woods, an investment bank, estimates that around $6-8 billion is being lined up to invest in single-family homes, the most appealing part of the market. Blackstone is said to be buying some 100 houses a day in selected markets. Normal home owners are the ones with FHA/conventional loans. They cannot compete with hedge funds with REIT to refinance what they just purchased using debt. You cannot beat Blackstone with your credit rating and they are leveraging using loans to improve yields.

Rick Sharga from Carrington recently said: there are three different sources for properties that you can purchase. There is new home development of which there has been virtually none of over the last five years. There is existing home sales, which are limited since between 1/4 and 1/3 of all homeowners who are upside-down do not or cannot sell their property. There are also distressed properties, which are technically existing homes that are put into a different bucket. All three of these things are lower than normal, and there is a limited amount of inventory available. At this precise moment in time Wall Street came in and gave $8 billion to spend on REO properties. Imagine what would that do to the price and that's exactly what happened. Common men are screwed.

The good comfort is that they may not dump all their rental all at once, because they need the cash flow for the business structure to work so they can only sell a portion of their properties at a time in the future. But it's not all the evil hedge funds at work, they, like the rest of us, are driven by yield and Ben Bernanke doesn't give them any other options.

Submitted by bearishgurl on December 4, 2012 - 3:42pm.

outtamojo wrote:
. . . It IS fraud, spoken causually because that is the way business is done these days. Pity anyone looking to buy a place to live these days, the wink wink crowd gets all the pretty shiny places at 2008-2009 prices while the common man gets to tour fixers at full market price . . .

outtamojo, I agree that the selection for FTB's and other similarly-situated buyers is lower right now, partly due to the "secret, backroom deals" you speak of here. The <$400K price range is VERY attractive to buy and hold investors, ESP to those who pay all cash for a property.

HOWEVER, there ARE plenty of SFR listings that have been in the MLS for 2+ weeks in MANY zip codes which "apparently" have not gotten "good enough" offers on them yet. I don't see a cosmetic fixer as a problem for these types of buyers. Those in the <$400K price range who need >1500 sf w/garage should actually expect this, IMHO.

I see only opportunities for these buyers. Your statement above assumes buyers who pay "full market price" (whatever that is, lol, it's low to reasonable) today will not have made a good or great deal, in hindsight, tomorrow ... ESP if they locked in the prevailing prime mtg interest rates.

I understand that a few of these current listings which have been languishing on the market may have structural damage and thus will only sell to a particular kind of buyer. But that leaves at least ~1500 current SFR listings in the county which are NOT "moving like hotcakes." Perhaps investors don't want them because the sellers won't sell them cheap enough to effect a good rental ROI or flipper ROI. But that doesn't mean they aren't good houses for joe6p and his family for the time it takes them to buy and flip (abt 1-3 yrs if both have FT jobs). Hundreds of very well-located SFRs in SD County appear to be sitting on the market today waiting for good/reasonable offers while buyers whine and wring their hands, lamenting that there is nothing out there for them.

Nothing could be further from the truth.

*****

Back in the "olden days" of 10%++ mtg interest rates, we boomers (at the ages Gen Y is now) were happy to buy those cosmetic-fixer SFR's here in SD County for between $32K and $90K. You may think those prices are "cheap" by today's standards but it's all relative, as is the lower profit (than today) we were able to make on each one.

I'm partly as secure as I am today because of decisions I/we made decades ago to engage in serial fixup/rehab work of local SFR's for later sale.

If you (as a Gen Y'er who just bought a cosmetic fixer), have young children, put them in a playpen and/or a swing (now they're elec and you don't have to crank them up every 15 mins :-D) and let them fall asleep to the sound of power tools or rock n roll (there were no ipods back then ;-]) and get to work scraping, dumpster loading, etc. Your future net worth depends on it!

Submitted by CA renter on December 4, 2012 - 3:47pm.

Good post, Carlsbadworker.

Submitted by bearishgurl on December 4, 2012 - 4:12pm.

carlsbadworker wrote:
. . . Rick Sharga from Carrington recently said: there are three different sources for properties that you can purchase. There is new home development of which there has been virtually none of over the last five years. There is existing home sales, which are limited since between 1/4 and 1/3 of all homeowners who are upside-down do not or cannot sell their property. There are also distressed properties, which are technically existing homes that are put into a different bucket. All three of these things are lower than normal, and there is a limited amount of inventory available. At this precise moment in time Wall Street came in and gave $8 billion to spend on REO properties. Imagine what would that do to the price and that's exactly what happened. Common men are screwed . . .

CW, you forgot to mention that of the 2/3 to 3/4 remaining local homeowners who are NOT upside down, the vast majority of the ones who appear to be selling are:

- possible heirs for homeowners who died;

- relos out of county (where an employer may be financially assisting in closing and moving costs);

- those who can't wait another minute to move closer to or live with family members (usually 75+ yrs old);

- those getting a divorce;

- and, those who must move into assisted living or a nursing home NOW and their heirs don't want their property.

All "other homeowners" appear to be sitting tight. WHY? Because they CAN! They don't have to play games with bottomfishers ... incl the cash offerors who want to use their properties as a launching pad for their next $150K ++ profit in less than 60 days.

These homeowners can ALL wait for a better day ... and, in SD County, those better days WILL come ... if not sooner, than later.

It's all okay.

If today's buyers want more inventory to choose from, that will happen when they lose the "I'm going to steal a house in excellent condition and/or a prime location," mindset and face reality.

Submitted by carlsbadworker on December 4, 2012 - 4:57pm.

BG, you are basically saying inventory will improve at much higher price point, which is probably what is going to happen unless mortgage rate suddenly went up and dry up buyers (mostly investors for SoCal). Given Fed has pledged not to let the latter event happen, so you are probably right.

Submitted by flu on December 4, 2012 - 5:20pm.

What the hell do you guys expect...Our government is encouraging this...They want more money so they can do this.. So they can avoid any sort of fiscal pain...Why is any of this so surprising to any of you?

Submitted by The-Shoveler on December 4, 2012 - 5:41pm.

flu wrote:
What the hell do you guys expect...Our government is encouraging this...They want more money so they can do this.. So they can avoid any sort of fiscal pain...Why is any of this so surprising to any of you?

The only thing is they are missing the part where minimum wage goes to $15.00 an hour.
But I guess they can’t do that and claim there is no inflation.
I have always said you will never get a recovery until home prices are close to peak nominal price.
The sad thing is it did not have to be this way, but I can’t see how they did not plan it this way as it was so obvious what was going to happen.

The housing market version of Pump and Dump.

Submitted by bearishgurl on December 4, 2012 - 7:17pm.

Most potential sellers don't need to make a "killing." But if market conditions are such that they do, then great.

But selling prices which are lower today than that exact same neighborhood sold for in mid 2003 are NOT adequately compensating legitimate buyers who bought with at least 20% down and qualified under the normal lending guidelines prevalent at the time. IMO, all properties from April 2003 and before were likely true market-rate sales bought by people who legitimately qualified for them.

If any of those owners have improved their properties since then and did not take out any equity, then they deserve to be compensated fairly for their investment today, IMHO.

In many areas of SD County, we are not quite there yet. There are dozens of shorts and potential shorts in the pipeline in most of these areas but a another cursory check of 8 local zip codes over the weekend revealed to me that the "winning" buyers who actually closed these SS's in the last 10 weeks were, on average, paying $50K to $80K over the unrealistically low "opening bid" designed to attract bidders.

As it should be. It's not where it needs to be yet but it is getting there.

Submitted by spdrun on December 4, 2012 - 8:34pm.

Bearishgurl - who says that the market was "right" pre-2003? Maybe it's right now. Just because you lost your panties and bra on a house you bought in the early 2000s doesn't make the current market wrong.

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