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October 2, 2006 at 9:11 PM in reply to: People still buying – masses have no clue about bubble #37090October 1, 2006 at 4:39 PM in reply to: False Market, Developer Rents out unsold homes, Ripple Effect #36964
no_such_reality
ParticipantI think you’re getting some accounting double talk.
If the bank forecloses, they set a trustee sale. The trustee attempts to auction it off for as much as possible, if no one will step up and pay as much as the bank is owed on it, then the bank takes possession at the default amount. Hence, the bank owns it at $655K the amount owed on the loan. When they sell it, they’ll want as close to that as possible since otherwise they carry asset lossed forward and start to dent their earnings.
October 1, 2006 at 11:32 AM in reply to: False Market, Developer Rents out unsold homes, Ripple Effect #36930no_such_reality
ParticipantThis is why I think we’re likely to actually see rents fall.
As the vacant speculator homes come back to the real market, vacancies in the complexes will increase. Once they return above their pain point, they’ll start the cycle of 1/2 off first month’s rent. Rent a year, get December free…
Even when people are capable of paying $1300/month rent, they won’t need to. We’re seeing it in HB already, the strip of condos along PCH at the beach has so many for rent and for sale signs up, only the biggest of idiots wouldn’t walk from one to another, literally, there’s four or five for rent in the same building from different owners.
no_such_reality
ParticipantI’ve been pondering this question too. The banks are already positioning it as Fraud, fraud, fraud on the part of individual home buyers.
Other than an S&L type bail out of the banks backed by the taxpayers for all the fraudulent loans buyers foisted upon them, I don’t see what the Gov will do to prevent what will be local market conditions. The banks will be a national issue, SoCal’s housing implosion will be SoCal. Texas will keep chugging along. Detroit, Indiana, and Ohio isn’t a housing issue as much as a jobs issues.
In the end, I think experiencing a single asset revaluation is a lot easier on everyone than experiencing a currency revaluation.
no_such_reality
ParticipantWhere does your 306,000 number come from? SD is only generating ~40,000 sales/year at peak. Roughly only the last two years are exposed on an equity basis. Plus whomever refi’d to the max.
I’m thinking it looks like you’re off by a factor ten. Which is still quite phenomenal given a quarterly default of 9500 homes.
Even if you adjust the actual default from 95% to something like 33%, you still end up with 3000+ defaults, which at August’s current sales rates, is an entire quarter worth of sales.
That’s probably the uglier way of looking at it. How few actually defaults need to occur to get to over half of the home sale volume being defaults.
no_such_reality
ParticipantLight fixtures gone. Appliance gone. Sounds like a mess, and that’ll one of the good ones.
no_such_reality
ParticipantIf condos implode downtown and in the UTC area, the rents could drop too. Operative word is could.
In the meantime, your mortgage is roughly rent, so why bother with the hassle of selling and moving. Just ride it out and keep it in decent enough condition that you could rent it out if you want to move.
Condos are the perfect example of why the math needs to work out. They are just an apartment. In the end, your PITI and HOA need to be less than rent to make owning worth the hassle of owning and eventually selling.
HOA fees also the primary problem with condos. You buy to get away from the useless expense but the HOA keeps it there. They’re just like rent. In orange county, there’s places that have HOA fees on one bedroom condos pushing $300 or more. It wasn’t that long ago that you could rent a one bedroom condo for $800 to $900.
no_such_reality
ParticipantWhat happened in 1985 to increase consumption percentage?
Ronald Reagan.
Supply side economics.
Cold war victory via defense build-up.
Deficit funding of the US Government.
essentially the entire $7.2 overspending is just the debt the Government has piled up.
It can’t be repaid. The global markets would panic if the US actually started to pay off their debt.
no_such_reality
ParticipantThe $6800 amount is basically the amount that makes it to the classroom and does not include capital buildout, administrations etc. link
I’ll gladly agree, the typical people complaining about illegal immigration are also the first ones pulling up to the home depot day laborers when they need physical work done.
Overall, I recognize we’ll have wage and price inflation. However, I suspect once we have all of our necessary workers above the board, we’ll better be able to maintain our quality of life in a sustainable manner.
Essentially, we are merely repeating the middle ages. Instead of innovating like we did in the renaissance, we continue to exploit cheap plentiful labor has the Europe did before the black plague occured eliminating plentiful labor. The result, was innovation and the shift from the manually intensive processes.
I’m not a great fan of living wages, but I’m even less of a fan of artificially low wages for physically demanding or unpleasant work because the owners are exploiting non-Americans in our own country,
no_such_reality
ParticipantThat’s just CA’s agriculture industry…think about the entire hotel and F&B industry in CA — labor is a much higher % of their costs, direct or otherwise
Basically you’re argument is that you want illegal immigration so your dinner for two at the California Pizza Kitchen will only be $60 instead of $65. Meanwhile one illegal child is costing us $10,000/yr to put in school.
But wait, I thought the argument about F&B was they’re paid minimum wage or less so they had to get tips…
You only have fake fear as a point and no data.
no_such_reality
ParticipantPowayseller, has the Government addressed the social security issues? No. Saying they’d have done it if it needed doing is silly.
It’s a truely rare leader that does what needs doing instead of doing what will get them re-elected.
For farming, 75% of the food we eat is generated by less than 10% of the farms. These aren’t mom & pop operations. They are large corporate entities.
Now here’s some facts, farm labor, the hired labor of the type we can’t survive without only accounts for 10% of the farm costs. That’s at the farm level. It’s insane to that minute cost is going to explode into double digits boogeyman inflation at the retail level.
no_such_reality
ParticipantThe benefits we receive are phyrrhic victory at best. Yes, I’ve seen the farms and the construction sites. I’ve also seen the nannys and residential gardeners.
The net result is they are actually taking more out through the use of our infrastructure than the benefit we receive.
As for unemployment, the numbers have been twisted in so many contortions for political purposes that they barely represent anything.
Now, if we truely can’t live without them, then we should make them citizens and move on. If not, then allowing their exploitation for the benefit of the few, the business owners.
no_such_reality
ParticipantMy simple view …
Quit pandering to every special interest.
My bitter view…
1. Enforce the realization with the public worker unions that they are “Public Servants”. Their pay and benefits packages need to be brought in line with the public companies. This includes their expecting to actually get work done. This also includes the bleeping politicians.
2. Enforce our existing laws for taxes and employment. I’m tired of seeing everybody register their cars out of state or CEOs use WA or TX as their place of residence when they are in CA 90% of the time.
3. Send the illegal aliens home. The resulting drop in requirements on our schools (K-12) and health & human services (which account for over half of the budget) will allow us to reduce it finally.
4. Revoke the proposition process. The misinformation and blatant manipulation by special interests for personal gain is pathetic. With the lack of accomplishment from our legislature, the proposition process has simply become Mob rules.
no_such_reality
ParticipantBecause emergency room is for emergencies.
Actually Perry, that’s the number one problem for ER’s. The flood of non-emergency issues.
no_such_reality
ParticipantWe have a guy that has been throught he ups and downs with our neighborhood for a while. We get notepads about every other month left by hime blanketing our complex. He’s one of those agents that virtually owns the neighborhood.
Anyway, his semi-monthly letter arrived Friday. I opened it and was quite surprised to see his advice for those thinking of selling. Price it right, price it low, if you don’t, it won’t sell. In addition, he was beating the competition drum on it too, showing the last place sold and how many are for sale in the complex at which price for which amount.
A welcome dose of reality from an RE Agent.
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