Step 4...Make a Searching and Fearless Inventory of Possessions,and Sell Them on Ebay
Buyers in trouble are having a hard time selling out of foreclosure...
"California-based distressed property investment advisory firm ForeclosureS.com reported today that foreclosure activity in western housing markets is on the increase as high-risk adjustable rate loans begin to reset to fully amortized payment schedules."
'"In California, we recorded 28,550 notices of default and foreclosures in the first quarter of 2006, and 9,222 new defaults in April," said Ms. McGee. She went on to say that, because coastal markets had been badly overheated for more than five years, more homebuyers used so-called exotic mortgages in order to qualify for more and more expensive homes."
"ForeclosureS.com president Alexis McGee said that a combination of rising interest rates, flattening price appreciation, and growing inventories of unsold homes were putting more households in financial distress and making it more difficult for troubled homeowners to sell their way out of foreclosure."
'"In San Diego for example," said Ms. McGee, "in recent years more than half of home purchases were financed with interest only adjustable rate loans or option ARMS with very low teaser rates. According to a recent study by Dr. Christopher Cagan of First American real estate solutions, someone paying $800 per month on an option ARM could see their payment jump to $3000 per month. That's likely to result in default."'
In Sonoma County 69% of the loans last year were risky loan products, with a huge portion of them being negative amortization products... how is that going to work out? Let me tell you... it won't be good.
See Marinite's post over at the Marin Real Estate Bubble site for more informaiton on just what Wall Street thinks of all this ridiculousness.
and still the stupidity continues...
"Does the American home buyer need a 50-year mortgage?"
"Maybe not, but it's clear Statewide Bancorp of Rancho Cucamonga thinks Californians do.
The bank began offering 50-year mortgages in late March, primarily as an alternative to the interest-only and so-called exotic loans that many Californians have been taking out to pay for their high-priced houses."
"The 50-year mortgages are limited to California residents, and while there is some interest in them, Anthony Hseih, president of LendingTree.com, doesn't think they will take over the market."
'"There are lots of other mortgages available these days that can help buyers deal with higher home prices," Hseih said, including the 40-year mortgage, which has been around for many years."
"Considering that the typical American moves every seven years, why would anyone need a 50-year loan, or even a 40- or 30-year mortgage?"
"When we take out a mortgage, we think of it in a monthly payment rather than the life of the loan," Hsieh said. "Longer-term loans reduce monthly interest rates, and that's what people are looking at."
"Even people in their 70s who are buying houses are applying for 30-year fixed loans for that reason, he said."
"One of the big events in a family's life used to be the day they paid off the mortgage and owned the house free and clear," Hseih said. "But these longer-term mortgages and the fact that it is simple, cheap and quick to refinance means that the life of these mortgages is continually extended."
"Longer-term mortgages are more likely to be found in markets where housing prices are high, such as California, Las Vegas, and New York City."
"There has been growing concern that interest-only and exotic mortgages are being concentrated in these high-price areas, and that rising short-term rates will double monthly mortgage payments and result in more foreclosures."
17 Comments:
well 69% of recent homebuyers will be reminded of the other meaning of 69,and wish they were doing that with rush limbaugh rather than facing reality.i wonder how much more in the way of broken marriages,alcohol and drug abuse will come about due to the stresses if this collapsing market?ow.i have a new co-worker who bought a home last summer with her contractor hubby,a 5 year i/o balloon.nice gal,had her own biz at 21 works hard...tried to give her some leads on how to undertand properties and the market...she couldn't go there,too painful,so i'll leave it alone.
There's really a limit as to how much one can warn someone. My husband tried again on Saturday with our ex-neighbor, but he is totaly determined to do this, even though he did admit that yes, it was a down market.
"...he is totaly determined to do this..."
What, pray tell--he's now buying "investment property"? Not that this comes as any surprise, but during the last stages of the dot-bomb, I recall people buying stock post-peak just so they wouldn't be "left behind." And we all know what they left behind shortly after.
well MV...you can lead a horse to water... you know the rest.
I couldn't talk my friend out of paying $$ and spending time to become the next real estate sales tycoon. About the only advice I had for that one was... "don't quit your day job."
Does your friend actually do research or read? If so... print out some of the best stories with facts, figures and data... and leave them on his front porch.
Then like Pontious Pilot... wash your hands.
athena doesn't that go" you can lead a horticulture,but you can't make her think"?
Well, the latest from KSVYs' RE show this afternoon....they claim there are only 203 houses for sale here in Sonoma, and that's contrary to Ziprealty which states there are 272 houses..someone made the remark about a wonderful place to buy a real "steal" it supposedly last year this place they were speaking of would have cost 100k more. They reluctantkly admitted some prices were going down, but of course that also was a lot of pump priming I'm sure.
The developer that was buying the old place we were renting is not planning on building anything so I hear, he just wants to flip the property and I heard from a ortgage broker friend who was up at thge giant estate sale over the weekend that his RE agent was busy scurrying around trying to find buyers for him.
Meanwhile I also heard in the boulangerie this morning that the only places in BelTerre tht have sold were those bought by flipperslast year who still haven't been able to move em.
The horse pasture with the Clydesdales at E. Spain and 2nd Street East supposedly has gotten permits and zoning oks from the city to build a B&B and god knows what else on the field. Evidently, this is contrary to what was in the will of the old guy who owned the farm and died last year. Suposedly, he'd written that it was never to be sold. I'm sure if anyone makes a move, permits or no permits the East side neighbors will be there with rakes and torches to stop them, or maybe the city will buy it all up like they did with Montini Ranch. Well, I guess that what we need around here one more B&B on the East side! Yikes.
WOW! Now that's what I call a scoop MV! Multiple scoops!
umm... that property with the Clydesdales... I will be one of those people with the torch and pitchforks... and a b&b there is a HORRIBLE thought!
So I had to drive through vallejo and american canyon today...and noticed that the buses had DR horton advertisements, and mortgage advertisements and there were so many billboards for housing developments and real estate investment scams I lost count. It was almost comical because they were just overflowing... by the looks of it you would think there is nothing else anyone has to sell...
i took a walk around downtown santa rosa yesterday,and through the mall...real estate ads on buses,and condo ads on the advertising kiosks in the mall...also the city has installed a number of "woodstock" sculptures around downtown sr.they are 5' tall,made of fiberglass covered with reflector tape.i suspect they will shock some of our local street people into rehab...which gives them some redeeming social value.
Right... we don't need no stinkin' economy. We can just sell each other houses. Seriously, I felt like I was in one of those manufactured cities all stepforded out. How do you NOT notice that every advertisement is for real estate or mortgage something or other? And if you've noticed... how do you tell yourself this is ok, all is fine, and santa is on his way?
Athena, I always think of Braslia, the worst example of what can happen with a "manufactured" city.
hey,i got michael coit of the pd on the phone at about 11 this am,i was inspired to call him while making a sharp downward motion with my left hand (too many strawberries). i asked where he got his #'s,and he told me his source gave him a "snapshot" of the mls #'s once a month, itold him it sure didn't look like the #'s i saw on zip,and asked him if he verified the #'s himself? he said "you sound like you don't think i'm doing my job" i told him if he was taking #'s from a source that might have an interest in presenting a certain view of the market,and didn't verify them,he was lazy and incompetent at best.i gave him current zip #'s,and he said he was going to call his "source" for an update.i asked him if he was going to verify the new #'s or if the new article would be as misleading as saturday's? he responded that his article clearly disclosed that he relied on april data,and that he discussed the problems in the market... i quoted him the headline "parity between buyers and sellers" and reminded him of his claim that "there is a 4 month inventory" when there is more than an 8 month inventory and almost a third of the listings on zip show price reductions.he said he would check with his source.i said "checking your facts is sooo 20th century" and asked him if he had a computer? there was a long pause,and he said yes.so i spelled out ziprealty for him and warned him he could end up being haunted by henry mencken's ghost if he didn't start doing his job.i'm feeling a bit peckish,and it is time for lunch.
Zip isn't even the best source... they have 25% fewer listings, and their reduced list is only current for I believe 30 days. So I have to keep going in and manually looking up properties that had been on the price reduced list. I think it only records those that were reduced in the last thirty days or something. The ones I look up that are still listed simply have had no change to the pricing since the last reduction and that is the only thing I can think of for why they wouldn't be in the main list anymore.
Norcalmls has a better system for getting a total count of properties on the market for the county.
for Sonoma particularly GMAC has a better system... can't explain why there is so much disparity... well yes I can.... look who runs them.
This guy ISN'T doing his job and I would hardly call the person feeding him information a "source." Perhaps he should start referring to this individual as his SPONSOR as his reporting ranks right up there with the infomercial and amounts to complete misrepresentation at best... and conspiracy to defraud public consumers at worst.
athena,i used zip because i thought he'd remember it...presumably he knows what a zipper is.i expect this kind of ignorance from reporters when they write about firearms..."the bullet thingie comes out the skinny end" and the usual pc bullshit magical thinking that ignores any information that doesn't make them feel safe and morally superior...but this is real estate for god's sake and this turkey apparently did not realize that there might be information available...or that a realtor might perhaps have a slightly slanted perspective or be less than ethical and professional.....i should have just sold him a 10m house with 0 down and and i/o libor arm plus 5 points and moved to costa rica with the mistress i don't have...faugh!
well even with the flaws of Zip it would be light years better than this guy's lazy reporting. Even Zip had 1000 more listings than he stated in his printed sponsored infomercials.
Also a great resource is rereport.com
you can get info for more than just one county, and also breakdown by city, and lots of graphs.
the realtor appears to not have a fear of data or the truth.
This comment has been removed by a blog administrator.
This comment has been removed by a blog administrator.
Post a Comment
Subscribe to Post Comments [Atom]
<< Home