Home › Forums › Financial Markets/Economics › Can buyers in default 365 days or longer be saved?
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September 2, 2011 at 7:12 PM #728254September 2, 2011 at 8:49 PM #728259SK in CVParticipant
[quote=UCGal]The guy who’s back in school is changing careers, his age was a huge factor in why he couldn’t find a job. No one wants to hire a 55ish high tech employee who’s spent 20 years at the same company. Another friend has strung together a series of contract/consulting gigs. But there are gaps between them. She’s cut her living expenses to the bone because her savings are gone after 2 years of this. The third friend is working half time at a much lower hourly rate… and glad to be working.
They have in common that they are all over 45. Younger friends were able to find new gigs easier. Ageism is a killer in this recession. Since I’m not young it terrifies me.[/quote]
This sure hits home. I’m almost that guy. 55ish. 12 years at the same company. Spent 10 months out of work. A few consulting gigs along the way. People kept telling me that I was being too picky. I was fortunate, that I could have afforded to be picky, but I wasn’t. Probably 750 resumes sent out. Less than 6 interviews. One job offer, where the prospective employer loved me but suggested I not take the job. (It paid $30K. I didn’t know that going in.) I didn’t take it. Besides that, 2 live positions that I wanted. Both hired people 20 years younger.
I was lucky, really lucky. Sent my resume at exactly the right minute. I ended up with a job that’s better than any job that I ever dreamed of getting. In tech too (though that’s only a coincidence, it wasn’t a requirement I had.) But I had to leave town to get it. Job market for those over 50 in san diego sucks beyond belief.
September 3, 2011 at 2:07 AM #728272CoronitaParticipant[quote=UCGal][quote=flu][quote=UCGal][quote=flu]
I guess the question for me (which I don’t know) is is there or is there not an unemployment or underemployment problem in San Diego? ,I’m not seeing massive hiring, but I’m not seeing massive layoffs either (at least not in tech). We lost of a few people recently because they decided to pursue startups. So things can’t look that bad… I don’t know really at this point.
What’s other’s people’s employment experience here? Is there a jobs problem in SD?[/quote]
My employer did layoffs pretty heavily last year and the year before. I’m still in touch with a few effected folks. One is back in school because he couldn’t find work, and 2 are doing contract work, less than full time.My husband continues to be part time because there isn’t quite enough work for full time. Architecture continues to be less than booming on the commercial side.
All of this suggests underemployment is an issue.[/quote]
UG, if you don’t mind me asking, how much do you think your friends/colleagues that are in this situation are underemployed by in terms of % off from full time income.
Also, out of the people you know, what percentage of people are in this category versus at a full time gig with relatively same salary (+- 10% lets say)….
We know that two years ago, it was pretty bad, expecially for MOT/MMI people. Have most of these people recovered already, or are most of these people still underemployed/unemployed? And it’s about people here in SD, right? Not at other MOT/MMI locations… I’m mainly interested in the “pulse” here in SD… I’ve been kinda out of touch lately, so I haven’t been following as closely…[/quote]
The guy who’s back in school is changing careers, his age was a huge factor in why he couldn’t find a job. No one wants to hire a 55ish high tech employee who’s spent 20 years at the same company. Another friend has strung together a series of contract/consulting gigs. But there are gaps between them. She’s cut her living expenses to the bone because her savings are gone after 2 years of this. The third friend is working half time at a much lower hourly rate… and glad to be working.They have in common that they are all over 45. Younger friends were able to find new gigs easier. Ageism is a killer in this recession. Since I’m not young it terrifies me.[/quote]
Thanks for sharing this info. Didn’t realize that it’s still that rough for some out there. Unfortunately, I have to admit, I don’t see too many techies over 45’s that are still hands on pure techies. I think eventually, I’m going to have to call it quits early…all my docs are telling me I have a long road ahead, and I don’t see myself busting 60-80 hrs a week on a full time + any side gigs moving forward, definitely not in the near future…
September 3, 2011 at 4:36 AM #728278CA renterParticipant[quote=SK in CV][quote=UCGal]The guy who’s back in school is changing careers, his age was a huge factor in why he couldn’t find a job. No one wants to hire a 55ish high tech employee who’s spent 20 years at the same company. Another friend has strung together a series of contract/consulting gigs. But there are gaps between them. She’s cut her living expenses to the bone because her savings are gone after 2 years of this. The third friend is working half time at a much lower hourly rate… and glad to be working.
They have in common that they are all over 45. Younger friends were able to find new gigs easier. Ageism is a killer in this recession. Since I’m not young it terrifies me.[/quote]
This sure hits home. I’m almost that guy. 55ish. 12 years at the same company. Spent 10 months out of work. A few consulting gigs along the way. People kept telling me that I was being too picky. I was fortunate, that I could have afforded to be picky, but I wasn’t. Probably 750 resumes sent out. Less than 6 interviews. One job offer, where the prospective employer loved me but suggested I not take the job. (It paid $30K. I didn’t know that going in.) I didn’t take it. Besides that, 2 live positions that I wanted. Both hired people 20 years younger.
I was lucky, really lucky. Sent my resume at exactly the right minute. I ended up with a job that’s better than any job that I ever dreamed of getting. In tech too (though that’s only a coincidence, it wasn’t a requirement I had.) But I had to leave town to get it. Job market for those over 50 in san diego sucks beyond belief.[/quote]
Wow, the pay for that job is insane! That must have been a very low point when you heard that number.
So glad you’ve managed to find a great job with a good salary. Hope it lasts for as long as you want to stay there.
FWIW, this is why unions have seniority policies — it’s to protect against age discrimination, which is rampant, unfortunately.
September 3, 2011 at 7:54 AM #728279AKParticipantI’m surprised by the results of sdr’s analysis too. But who wants to take on the risk of refinancing a property that’s almost certainly underwater?
Temecula is down 50% from the peak because of the uncertainty caused by the quarry project. Oh yeah, and because Temeculans like to argue. Once the quarry project is officially DOA, look for the next real estate bubble to start in Temecula.
The worst thing about age discrimination? IMO most of it is internalized age discrimination among managers over 45. They perceive their own physical and intellectual decay and project it on to their older subordinates.
September 3, 2011 at 9:12 AM #728281sdrealtorParticipant[quote=AK]I’m surprised by the results of sdr’s analysis too. But who wants to take on the risk of refinancing a property that’s almost certainly underwater?
Temecula is down 50% from the peak because of the uncertainty caused by the quarry project. Oh yeah, and because Temeculans like to argue. Once the quarry project is officially DOA, look for the next real estate bubble to start in Temecula.
The worst thing about age discrimination? IMO most of it is internalized age discrimination among managers over 45. They perceive their own physical and intellectual decay and project it on to their older subordinates.[/quote]
The answer is Uncle Sam. The gov’t wants to keep people in their homes and keep the economy growing. The folks waiting for values to drop so they can get what they think they deserve are in the minority. A couple years back you all said there was no way the gov’t couldnt stop a complete collapse of housing. I said watch them. Its pretty clear they have and there is no signs they will stop.
September 3, 2011 at 9:46 AM #728287sdrealtorParticipantBTW, the answer to who would want to stay in their underwater home even if refied to 4% is just about anyone’s whose payment would be at or close to the rental amount net of taxes. Why wouldnt they want to stay in their home if they could at the same or lower cost than renting?
September 3, 2011 at 11:00 AM #728296SK in CVParticipant[quote=sdrealtor]The answer is Uncle Sam. The gov’t wants to keep people in their homes and keep the economy growing. The folks waiting for values to drop so they can get what they think they deserve are in the minority. A couple years back you all said there was no way the gov’t couldnt stop a complete collapse of housing. I said watch them. Its pretty clear they have and there is no signs they will stop.[/quote]
I keep rereading that sentence about the government, and I’m not sure I know what you’re saying. (the double negative has my head going in circles.) But for now, i’m going to assume that I was right on my first go thru, and that you thought the government would stop a complete collapse. And that they were successful.
I think you’re wrong. They weren’t successful. There was a complete collapse of housing prices. There was a complete collapse the housing industry. Most of the country is back to pre-bubble prices. That’s a collapse. Of course it could have been worse. And however feeble, ill intentioned, badly designed and poorly executed the various government policies have been, it wasn’t worse. They helped, but did not prevent a collapse. Particularly maintaining the low interest rates. Because those that said there is nothing the government could do (to prevent a collapse) were right. (I guess you could argue it wasn’t a complete collapse. Housing values didn’t drop to zero.)
Some economists might argue that government intervention had nothing to do with it, it was simply economic ergodicity at work. But not subscribing to that whole market equilibrium theory (mostly because it just can’t be measured, because in the macro world, there is no such thing as a market absent outside influence), it’s difficult to argue that intervention had no effect. Impossible to accurately measure, but government action did provide some brake, but didn’t prevent a collapse.
September 3, 2011 at 11:12 AM #728298SK in CVParticipantI have to apologize for that last comment. I got interrupted twice while writing, first by my daughter. Explaining that after 2 days of cutting up her fat old man human anatomy cadaver, she turned him over only to find, to her surprise, it’s a girl. And second, by trying to perfect my craigslist casual encounters ad (using BG’s implied recommendations). We’ll see if i got it right. Anyway, after finishing it, I’m not sure WTF i was trying to say. But have at it, maybe there’s a discussion point.
September 3, 2011 at 1:07 PM #728307sdrealtorParticipantBY saying it could have been worse you have proven my point. By definition, a collapse is when things are allowed to freefall to the lowest point possible. That didnt happen. They intervened and kept things artificially higher than they would reached.
September 3, 2011 at 1:54 PM #728308SK in CVParticipant[quote=sdrealtor]BY saying it could have been worse you have proven my point. By definition, a collapse is when things are allowed to freefall to the lowest point possible. That didnt happen. They intervened and kept things artificially higher than they would reached.[/quote]
Yeah, I think that is what I said. I started out disagreeing, but apparently changed my mind while I was typing. The only disagreement I have is with your definition of collapse.
col·lapse
1. To fall down or inward suddenly; cave in.It wasn’t a complete collapse, I think that’s what you described (to the lowest point possible). But it did collapse. The difference is minutia. We’re pretty much in agreement.
I don’t think I was among those that claimed the government wouldn’t step in and fix it. (I really don’t remember.) I remember thinking that there was no way to fix it. And in that regards, we were both right. They tried, but success was limited. It could have been just as effective, or probably even a little bit more effective, with a whole lot less money.
In a larger sense (and this is really addressing issues points made in a handful of current topics being discussed), what government intervention didn’t and can’t really control are the more important problems underlying the weak economy. It partially affected the crisis in housing prices. It can’t fix the problem with housing construction. That’s a much bigger problem going forward in rejuvinating the economy. Higher house prices won’t help (much). If we don’t need more houses, then we don’t need more houses, regardless of the price. Shifting demographics predict that we don’t, or at least probably won’t.
I don’t know that I agree with Roubini that it’s worse now than in 2008. (Actually, that BS, as much as I respect NR, in 2008 the economy had a heart attack. Now we’re 3 years post heart attack and only at risk for another heart attack. Which one is worse?)
But the key predictors aren’t any better. The difference is that the current economy is stable but bad instead of in crisis and bad. I think we have lower (but very real) risk of additional crisis. The over/under is pretty damn close.
September 3, 2011 at 2:30 PM #728310sdrealtorParticipantPretty much agree except I think they were more successful in certain areas than others. For example, the low end prices got hammered and I think the high end will too. Where they were most successful was in the middle to upper middle class areas. We never got much below 20% off around here and many other metro areas saw similar things. The low end which increased the highest percentages on the backs of NINJA loans got crushed.
September 3, 2011 at 10:07 PM #728324anParticipantA few properties in Temecula/Murrieta selling for >50% off peak:
http://www.redfin.com/CA/Murrieta/28296-Ware-St-92563/home/6625135 – 57% off peak
http://www.redfin.com/CA/Murrieta/31901-Blanca-Ct-92563/home/8159708 – 58% off peak
http://www.redfin.com/CA/Murrieta/35642-Abelia-St-92562/home/6417093 – 75% off peak
http://www.redfin.com/CA/Temecula/29691-Windwood-Cir-92591/home/6188396 – 61% off peakThere are many more just like these properties.
September 4, 2011 at 4:27 AM #728327CA renterParticipant[quote=sdrealtor]Pretty much agree except I think they were more successful in certain areas than others. For example, the low end prices got hammered and I think the high end will too. Where they were most successful was in the middle to upper middle class areas. We never got much below 20% off around here and many other metro areas saw similar things. The low end which increased the highest percentages on the backs of NINJA loans got crushed.[/quote]
The low end had zero buffer. This is where all the ZERO-down purchases were made, and where people were canibalizing their mortgages — using new debt to pay off old debt, which was only sustainable for as long as housing prices rose. They did not have the benefit of all the intervention, either, so the market was allowed to clear for the most part. By the time the declines were hitting the mid and higher-end homes, the Fed and govt were enacting foreclosure moratoriums, reducing rates to near zero, and announcing plans to “save homeowners” from themselves. That’s why the lower end collapsed more than the mid and higher tiers.
You might think that they have “fixed” the housing market, but that assumes that the problems are in the past. I contend that the “crisis” has simply shifted…it is nowhere near over, and housing prices have not bottomed, IMHO. The sovereign debt crisis is very much a part of the “housing crisis” because the housing bubble was an effect of the credit bubble. Until the credit bubble has resolved (we are not even close), the housing market will remain on shifting sand.
September 4, 2011 at 7:44 AM #728329scaredyclassicParticipantThose redfin listings above will probably close a bit higher than the asking prices I think.
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