Sunday, April 16, 2006

Weekend Open Discussion!

Judging from the site traffic this afternoon, it seems many of you have started your weekend early. It's only appropriate that I start this discussion early as well. Have a great weekend!

Observations about your local areas, comments on news stories or the New Jersey housing bubble, Open House reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let's have them.

For readers that have never commented, there is a small link on the bottom of each new message that reads "# Comments". Go ahead and give that a click, you might be missing out on a world of information you didn't know about. While you are there, introduce yourselves to everyone.

For new readers that have only read the messages displayed on the main page, take a look through the archives, a substantial amount of information has been put online in the past 6 months. The archives can be found at the bottom of the right hand menu and are categorized by month.

As always, anything goes!

143 Comments:

Anonymous Anonymous said...

is leasing with the option to buy considered a sign of weakness in the market?

4/14/2006 03:11:00 PM  
Anonymous Anonymous said...

Grim:

could you please help to check the listing history of this house?

2266640

remember seeing it about a month ago, later disappeared. But it emerged in MLS again today.

Seems more and more are re-listing. wondering whether they priced it lower or higher. Before they tended to list higher.

Thanks

4/14/2006 03:22:00 PM  
Blogger grim said...

MLS# 2231641
Originally listed at $799,000
Reduced to $749,000
97 Days on Market

Relisted as:

MLS# 2266640
Asking $769,900
1 DOM

Purchased 8/31/1998 for $357,725

grim

4/14/2006 03:29:00 PM  
Blogger grim said...

The original listing was Withdrawn, don't know if it was listed under another broker, etc..

grim

4/14/2006 03:30:00 PM  
Anonymous Anonymous said...

Hopefully, the sellers will accept our (low ball) bid on their POS which they think shines like gold.

Question for anyone in anticipation of seller's acceptance of our bid: Does anyone have a good or bad experience with home inspectors. I understand they are required to be licensed in NJ, but have heard the NJ state legislators and wonderful ex-governer(s) have reduced the requirements drastically (probably at the demands of the real estate lobby!). I need to know what to watch out for when interviewing inspectors, I would never ask the realtor for a referral (DUH! Huge CONFLICT of interest/ETHICAL challange) and am hesitant about using the yellow pages!

4/14/2006 03:39:00 PM  
Anonymous Anonymous said...

Grim:

Thanks for the super fast result..

They still aim high. Haven't seen the article : I should have priced it lower from the begining?

But anyway, I am glad the house did not get sold for such high ridiculous price.

thanks again.

4/14/2006 03:40:00 PM  
Blogger pesche22 said...

grim,,

whats the site for the mls for new jersey

4/14/2006 03:47:00 PM  
Blogger njresident286 said...

njmls.com

4/14/2006 03:53:00 PM  
Anonymous Anonymous said...

had an RE tell me to "buy intead of rent because intrest rates are going up and prices are only going up"

4/14/2006 03:55:00 PM  
Anonymous Anonymous said...

Just added few points w/regards to 2266640:

I did a quick calculattion:

bought in 1998 for 375K,

assume the following:

annual % growth rate=3%, the house worth: 475K in 2006,

4%, 513K;
5%, 554K;
6%, 597K;
7%, 644K;
8%, 694K;
9%, 747K.

what kind of investment can give you this kind of return, considering you normally only paid 20% down in 1998. roughly that was an return of around 400% in 9 years!

So while low balling, we can track the transaction history ang get price pre-2000. Then use a simple calculation to tell them what our bid's price base is.. Can the seller do the same thing, legitimizing their asking price, other than the stupid Comp analysis?

We only want to pay a fair price for a house, not trying to rob as sellers did, as what happened in the last 6 year!

4/14/2006 04:00:00 PM  
Anonymous Anonymous said...

Did anyone see the "Real Estate Showcase" in the local Coast/Ocean Star paper. It is full of overpriced houses and honors realtors who suckered the most money out of people. It is amazing how ignorant they are and how much denial is going on about the market conditions.

4/14/2006 04:09:00 PM  
Anonymous Michelle said...

"the stupid Comp analysis?"

???

Any house is only worth what someone is willing to pay for it, and if similar places at their asking price are still selling recently then why would your seller take your lowball? Because YOU have deemed what a "Reasonable" Return on investment would be for them?

By all means, lowball your heart out, and I hope for your sake it’s accepted, but I don’t see how your subjective ROI analysis is going to make a seller change their mind about how much they should accept for their house. I know I’d be p’d off if someone told me how much money I was “supposed” to make on it. You’re better off making your offer positive instead of instantly annoying the seller.

4/14/2006 04:50:00 PM  
Anonymous MarMar said...

I've been waiting for the weekend discussion all week. I need some opinions.

1) Interest Only Mortgages (What's your opinion if you plan to overpay and have it applied to principal)

2) What to buy first? A rental property or a home to reside in?

3) 80/20 mortgages. Where both are financed loans.

4) Realty Associate....How to find one that is GOOD.

4/14/2006 05:03:00 PM  
Anonymous Anonymous said...

Michelle,

From what I have been reading on this blog, didn't you make a lowball offer on your recent purchase of a property? Am I mistaken?

4/14/2006 05:17:00 PM  
Blogger grim said...

maxmar,

For questions 1 and 3, take a look at this site:

http://www.mtgprofessor.com/

Question 2 - Why not both, a multifamily?

Question 4 - There is such a thing as a good real estate agent. Find one that's been in the business for 25 years or more. The grayer the better.. :)

grim

4/14/2006 05:26:00 PM  
Anonymous Anonymous said...

anonymous @ 5:00 PM:

What kind of assets return 9% each year?

Let's see.. The S&P 500 averages around 12-14% annually.

Even HSBC savings pays 4.8%.
Average inflation is like 3.5%

Expecting houses to appreciate less than inflation is a little ridiculous don't you think?

4/14/2006 05:34:00 PM  
Anonymous Anonymous said...

Not to mention that leverage isn't free. The owner probably had to get a mortgage at 8% in 1998.

4/14/2006 05:46:00 PM  
Blogger Josephine723 said...

A month or so ago, my fiance and I put a lowball bid on a house in Demarest, NJ. The offer was $650K and the house, which was sitting on the market for almost one year, was listed at $729K. They took 4 days to come back to us and say no. They had no counter offer. We liked the house so much that we went to 675K. They countered with 705K. We decided to drop it. Got a call a couple of days ago that they will now accept the offer if we are still interested.

I've been reading a bit about the market and also these blogs and I have cooled on the idea of buying right now...so we looked again and decided to pass it up at this time. In Bergen County there are tons of "for sale" signs now so I feel like I may be able to get more house later for my money.

4/14/2006 06:07:00 PM  
Blogger gravitymatters said...

I put a lowball bid on a house in Demarest, NJ. The offer was $650K and the house, which was sitting on the market for almost one year, was listed at $729K
-----------------------------------

Josephine, was that the house on Stewart? If so... an identical (better condition too) layout a few houses down (opposite side of street) sold for around $709,000 last fall.

Your 650k offer is probably all its worth (even in todays market) "IF" we are talking about the same place.

I think Demarest is a great little town too.


(OT) Grim... tried sending you an email, hopefully it went thru okay.

4/14/2006 06:33:00 PM  
Anonymous Anonymous said...

Michelle:

As you put it, buyer should not be the one determines the fair return of the sellers investment, should the seller determine that? without a buyer, how should the return be realized?

The days are not very far away from us when sellers are no longer the one determine what returns should be for their investment, don't you think?

4/14/2006 06:34:00 PM  
Anonymous Anonymous said...

Grim & Mar Mar

Grim I respectivly disagree on your suggestion for a buyers realtor with over 25 years experience. My experience with agents in the business a long time is they do not want to be bothered with buyers. They want listings... more powere to them. The new agent will be more willing to take you out to more places than a seasoned veteran. They have a you've seen enough make up your mind kind of attitude. I know this first hand. I think an agent who is willing to show you whats out there and layout all the facts for you, so you have the knowledge to make a good decision - that would be a good agent. By all the facts I mean anything you as the buyer ask and the agent can find out and tell you, including but not only past sales history.
When I am unable to help a freind because of my location and lack of knowledge in there location I always suggest they call the agency on a monday or tuesday night when the new (read excited-not jaded - hungry - willing) realtors have floor time. The daytime been there forever agents pick and choose there clients, based on easy sales.
That's my experience FWIW

KL

4/14/2006 07:19:00 PM  
Blogger Josephine723 said...

Gravity,

That was the offer they didn't respond to for three days and then with no counter offer. That was a turn off.

Nice house at the wrong time. I am going to wait for something a little more updated inside. Old kitchen and three bathroom updates needed on that one.

4/14/2006 08:06:00 PM  
Anonymous Anonymous said...

Best advice for finding a realtor is this: Tell a realtor you dont want to spin his or her wheels having them show you 10 houses a week. Ask if they would be willing to send you via email all the homes in your price range in the town(s) you seek. You should also specify the minimum and ideal amount of BRs, Baths and Garages. that will make your search that much smoother.

4/14/2006 08:15:00 PM  
Anonymous Anonymous said...

KL,
Are you KvL by any chance?

4/14/2006 08:36:00 PM  
Anonymous Anonymous said...

Here goes my story.

I have tried to lowball this one at 600K.

2258378

It list price is 699K. The seller turned down my offer without count-offer. I am very disappointed, because I think my offer is very decent compare to lowball deals in this blog. My initial thought was lowball it at 580K.

This experience makes me wonder that this market is still sellers market. They are still very strong and we (buyers) are still underdogs. Am I right?

4/14/2006 09:16:00 PM  
Anonymous Anonymous said...

KL,
Are you KvL by any chance?

No Sorry

KL

4/14/2006 09:17:00 PM  
Anonymous Anonymous said...

More about 2258378

I have checked that the current owner bought that house at 250K in 1999. And now they want it 600+K!!!

What a crazy market!

4/14/2006 09:24:00 PM  
Blogger Richie said...

Wait it out, the house has been on the market less then a month. The sellers have no idea what the market is like.

You can live without the $12k in taxes that the house currently pays. Let the seller pay them for now.

-Richie

4/14/2006 09:26:00 PM  
Blogger grim said...

This was posted on the Lowball thread for this week. It's far down the main page, and I'm sure the 'regulars' don't scroll down far, so I'm going to repost it here.

Anonymous said...

This section rocks! I have been a reader of this blog for 6 months. Grim, I followed your advice. I found a property in Hopewell, NJ. I stalked it since last summer and noticed that the traffic to see the property was slow and it was overpriced. I bid last week and it was 17% below list, and 35% below original list. The seller finally threw in the towel and hit me. I priced my bid based on 5% appreciation per year for the last 6 years, from the last sale. I am very comfortable with this price. I think it protects me if the market sours. I am telling this story to prove to everyone out there that some sellers are motivated and in some situations they have to unload depending on their financing and other personal considerations. Also, this was not a sub million dollar property. The market is coming off at all price ranges. Good luck to everyone and thanks alot Grim.

4/14/2006 09:35:00 PM  
Anonymous Anonymous said...

The sellers are just starting to suffer.

For now, if they can not sell for price they think their house deserves to get, they chose to be in negative cash flow by paying more for mortagage than getting from rent.

But adding all expenses associated with owning under negative cash flow, dim prospect for property value raising, hugh chance the property value decreasing, how long can the sellers hold out?

They are paying Mortagage, PT, Insurance, etc.. It ain't pretty. the cost of holding is rather high.

4/14/2006 09:35:00 PM  
Blogger grim said...

KL,

I agree with what you are saying. You make a good point. If you really want an agent to go out and work for you, cater to you, and take you to see many homes, it's going to be a new (and hungry) agent that's going to do it. But it's a personal thing, some folks would rather do their own hunting and would rather enlist the services of a shrewed bargainer.

Me? Personally? I don't particularly care for some of the newer agents in the market. Alot of these folks were lured in by dreams of easy money. With no barrier to entry, you can just imagine the quality of some of these agents. Maybe it's just that I've had a bad experience dealing with some of the newer agents. I suppose I shouldn't hold it against them, many of these people have never gone through even a normal market, let alone a downturn.

I want the agent that'll tell me the brutal truth. The neighbor is a felon, the house isn't worth a lowball, the sellers are in the middle of a nasty divorce, etc.

The minute a buyers agent tries to sell me something, or hands me a line of bull, I'm done with them.

grim

4/14/2006 09:47:00 PM  
Anonymous Anonymous said...

I am amazed that there are still some informed readers here not bidding property at 30+% less. No wonder there are fools out there paying full price.
The bankruptcy court is ready for them.

4/14/2006 09:50:00 PM  
Anonymous Anonymous said...

Michelle,

Should we just accept the price made by the drunk sellers or present our more financially scientific bid? You sound exactly like my ex-realtor.

4/14/2006 09:52:00 PM  
Anonymous Anonymous said...

grim,

can you suggest some honest realtors that are willing to work with me on my low ball bids? I live in Morris county, NJ

4/14/2006 09:55:00 PM  
Blogger grim said...

There is no need to justify your bid price.

Simply write it up and have your agent present it.

If the seller rejects the bid, simply move on to your next prospect.

grim

4/14/2006 09:57:00 PM  
Blogger chicagofinance said...

Throw a lowball out there at any time. Show some patience. Probably the most successful lowball is one where you get that call 3-4 weeks later after complete silence. You have to wait these sellers out. If it was meant to be, it will come through for you. If not, as grim says, go on to the next one. To have a teflon attitude is how to win this game.

4/14/2006 10:09:00 PM  
Anonymous Anonymous said...

Don't get too emotionally attached to the property is my advise when throwing a lowball. Think it as an investment. You don't even KNOW this house. As experience grows, you would most likely find a better one if this one was rejected.

4/14/2006 10:31:00 PM  
Blogger Sadi said...

Love your site, Grim.

How do I find a realtor to negotiate for me? And by negotiate, I don't mean the popular realtor definition: "fax the offer over". I would want somebody who could really play hardball and convince the sellers that my lowball is a good idea.

If I could find someone like that I might actually hire them (fixed fee, dependent on sale?). So far, we're working on our own. We've gotten nibbles, but no house.

4/14/2006 10:32:00 PM  
Anonymous Anonymous said...

To "Here goes my story.
I have tried to lowball this one at 600K.
2258378"

Those sellers don’t realize how lucky they are to get your offer. If they come back with an offer or accept yours a few weeks from now, change your offer to the 580K.
I have made offers, been denied, then had calls back to accept - I do some research then have decided to pass on them. They weren’t houses that I HAD to have, just testing the market. You'll get a great home at a price you are comfortable with. Sellers have to come to terms with the changing market. You'll get that house or better. I have owned and sold - currently and willingly renting, passed on a few already and watch as those homes sit and are reduced. I am ready but in no rush. Best of luck

bh

4/14/2006 10:39:00 PM  
Anonymous jess said...

hi!

first of all, grim, thanks so much for this site! came thisclose to buying something but have decided to do a wait and see.

any of you guys out there have opinions on the crystal springs subdivision in hardyston township, sussex county? there's a mix of new developments and resales. NICE townhomes for $450-600K, and NICE houses for $550-800K. Resort living, etc. Marketing seems slick, but I wonder if it is a good investment...

Taxes abit on the high side, runs about $9-12K on those townhomes. Was thinking about purchasing as a second home, but with the market the way it is, am very cautious. So, I'd be interested in opinions of others...

Was recently written up in the NY Post... "Golf. Skiing. New condos. This Jersey spot aims to be Myrtle Beach meets Aspen":

http://www.nypost.com/realestate/61148.htm

4/15/2006 03:10:00 AM  
Blogger grim said...

Just an FYI for those who haven't been following the issue. The New Jersey smoking ban went into effect at 12:01am last night.

Judge rules smoking ban can begin

A federal judge on Thursday ruled that New Jersey's ban on indoor smoking in most public places should go into effect at 12:01 a.m. Saturday, ending a last-ditch bid by a group of bar and restaurant owners who wanted it delayed.

The group contended the temporary injunction was needed because their businesses will be hurt economically and may lay off workers while they await the outcome of a constitutional challenge to the smoking ban.
...
The ruling means that New Jersey is to be the 11th state to halt smoking in restaurants, bars, private office buildings and other indoor places. Regulations proposed by the state health department also mandate no smoking within 25 feet of a building's entrance, but those do not go into effect right away.


grim

4/15/2006 06:00:00 AM  
Blogger pesche22 said...

their are more real estate agents and tax preparers in the us
than doctors.

what does that tell us?

4/15/2006 06:23:00 AM  
Blogger grim said...

Jess,

Was thinking about purchasing as a second home, but with the market the way it is, am very cautious. So, I'd be interested in opinions of others...

Personally, I feel this is a pretty bad play right now. There are many investments, most significantly lower in risk, that will likely yield a greater (or net positive) rate of return over the next few years.

And, if you do the math, I'll bet you that it's cheaper to go to actually go to Aspen and Myrtle Beach every year than to purchase that place.

My wife and I took a look up there once. It's a big housing development. Aspen? Myrtle Beach? Resort living?? It's none of that, just plain ol' Sussex County.

grim

4/15/2006 06:27:00 AM  
Anonymous mboy said...

Anonymous said...
had an RE tell me to "buy intead of rent because intrest rates are going up and prices are only going up"

Are his intials FK?

4/15/2006 06:34:00 AM  
Blogger pesche22 said...

grim

i think the state has far more important things to worry about than smokeing.

and what the record starting next week for mills corp. disaster talk

4/15/2006 06:34:00 AM  
Blogger grim said...

Sadi,

That really isn't the way it works. All you should be concerned about is that the agent is presenting your offer to the seller. Rationalization of your offer or trying to convince someone of something isn't part of the process.

The offer is written up and presented, then accepted or denied. If denied or countered with poor terms, you simply move on to the next. There is no sitting down at a table with a spreadsheet, newspaper articles, or printouts of this blog.

grim

4/15/2006 06:38:00 AM  
Anonymous RW said...

interesting article in Marketwatch this am....

Inflation, housing collapse are risks to Fed forecast

"The Fed is looking for housing to slow at a moderate pace this year. If the market looks headed for an outright collapse, it could bring a quick end to Fed tightening. But it's unlikely the Fed would react to any one month's housing numbers, especially considering the rampant skepticism at the Fed that even falling home prices would curb consumer spending."

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BCFB334EA%2DB3C0%2D4D53%2D900E%2DA362B77390B0%7D&siteid=myyahoo&dist=myyahoo


Falling home prices won't curb consumer spending? With the housing ATM no longer spewing out money- those trips to aspen or even sussex county will be a luxury many can't afford...

4/15/2006 06:46:00 AM  
Blogger grim said...

Margin call is coming for many who used their homes as an ATM..

Take a look at some of these defaults from the past two or three weeks..

Purchase Date - Purchase Amount - Default Amount

Chester
8/1997 - $289,000 - $600,000

Madison
10/1998 - $318,000 - $693,000

Wood Ridge
8/2001 - $330,000 - $495,000

Allendale
10/1997 - $282,000 - $470,000

Paramus
1/2004 - $410,000 - $510,000

Gillette
11/1999 - $130,000 - $577,500

Clifton
10/1990 - $314,000 - $520,000

Many have incorrectly assumed that only recent purchasers would be underwater if prices fell. Unfortunately, that isn't the case. Many have HELOC'ed and Cash Out Refi'ed themselves into the same position.

While we have the stats to estimate the exposure of recent purchasers. I'm not sure anyone really knows the full extent of the total exposure once you include folks like those listed above.

grim

4/15/2006 07:16:00 AM  
Anonymous Anonymous said...

The banks are really going to start hurting with these types of numbers...or is it mortgage bonds that are going to default?

Simssays...

http://www.AmericanInventorSpot.com
AmericanInventorSpot.com

4/15/2006 07:31:00 AM  
Blogger gravitymatters said...

Josephine,

smart move waiting it out, why settle at this point?

the woman who owns that house is a prime candidate to chase the market down. putting aside the fact that it was tired inside & needed work... I seem to recall the 3rd bedroom was EXTREMELY small & the house lacked in closet space. Heck, 650K is alot to spend for that IMHO. definitely the sellers loss, not yours.

as interest rates, energy bills & taxes continue to rise, along with inventory... if you find a the right motivated seller, a lowball offer will have a higher probability of working out.

it appears Demarest woman is in no rush.

good luck!

4/15/2006 07:34:00 AM  
Blogger grim said...

Acoustic Home Loans, the nations 27th largest sub prime lender, closed it's doors on Friday.

As of 4/14/2006 Acoustic Home Loans is no longer in business. Acoustic will not accept new loan submissions after 4/13/2006; however, we will continue to process loans that are in approved status or better. Applications received after 4/13/2006 and loans that are not in approved status or better will be returned to the broker. If you are a broker with a loan in process, a borrower who has a loan with Acoustic, or the media please call our main number at 866.226.8784 and you will be directed to the appropriate person.

I have a feeling this is going to play out like the S&L crisis. Resolution Trust Corp anyone?

grim

4/15/2006 07:34:00 AM  
Anonymous Michelle said...

My point on the lowballing (and yes I did make one that was accepted) is that to approach it with the attitude of “this is how much I think you deserve to make” while ignoring valid comps is unlikely to succeed. The rates of return on real estate HAVE been incredible and crazy, whether or not you think they should have been that way. If I were selling and someone offered my a price saying “I don’t think you should make that much because it’s a high roi despite these comps which I think are’stupid’”, well, I wouldn’t even respond to the offer.

Presenting an offer using some of the info on this blog, including potential comps pulled from Lowball, explaining why the seller could reasonably anticipate his house declining in value going forward, seems to be a much more likely success story.

I think how you position your offer is an important part of lowballing.

Grim said “There is no sitting down at a table with a spreadsheet, newspaper articles, or printouts of this blog.”

Why not? Tell the listing agent that’s a requirement for wanting to present your offer. OR – as was extremely popular in California during the boom times – send your sellers a letter. Sure, it used to be a letter begging for the house, but now it could be a letter explaining why the seller, in the buyer’s opinion, should consider their lower offer. Buyers know the addresses of the properties they’re buying, so my let the agent stand in the way?

Regarding those default amounts above – WOW. Sheer stupidity. Glad the bankruptcy laws have tightened up.

4/15/2006 07:44:00 AM  
Blogger chicagofinance said...

grim said...
Margin call is coming for many who used their homes as an ATM..



ABSOLUTELY SICK!?!

4/15/2006 08:13:00 AM  
Blogger pesche22 said...

the sad part is that if you ask the average american whats going on. Answer: you get a comment ,,
something like,, oh your to negative.

everythings fine,,, im going to the mall.

or aruba,, mexico,,,or
the car dealer.

The average american saves nothing
and of course inflation is under control.

4/15/2006 08:27:00 AM  
Anonymous Anonymous said...

Michelle: Are you a broker, or do you just play one on this blog? Your "advice" is laughable...

4/15/2006 09:28:00 AM  
Anonymous Anonymous said...

Question for the group:

What would war with Iran do to the housing market?

Thoughts would be welcome. I have my own ideas but would like to see what others think that are not in the security/defense profession.

4/15/2006 09:33:00 AM  
Anonymous Anonymous said...

Anon who is sparring with Michelle,

Michelle is being fair & dispassionate. Don't call her names.

Even going by your absurd logic - when you project your 3% or 6%, you are not even adjusting for inflation (the govt released stats are heavily adjusted). www.shadowstats.com (for instance), is one website where you can real inflation stats.

Another analogy - Just because one might make a very convincing arguement that GOOG is worth $250 - it does not mean that he can demand a share of GOOG for $250 (at least on 4/15/2006) (because the market does not support it and there are other willing buyers). Of course, I realize that the market for homes is not liquid like the market for stocks.

CNS

4/15/2006 09:57:00 AM  
Anonymous Anonymous said...

I like pie.

4/15/2006 10:06:00 AM  
Anonymous Anonymous said...

Me too. Yum.

4/15/2006 10:07:00 AM  
Anonymous Michelle said...

Thanks, CNS.

Yeah sure Anon, I'm a broker suggesting that people bypass brokers. You're smart.

BTW, I DID make my presentation to my sellers in person, and while I won't describe my transaction again as it's already been discussed, I lowballed using a positive approach and it worked.

4/15/2006 10:09:00 AM  
Anonymous Anonymous said...

Thought you were a broker, as you sound like another housewife who thinks she is an expert on real estate. Just an observation. Try not to take it personally.

Thanks for agreeing never to mention your "transaction" ever again. Noted and on the record. Much appreciated.

4/15/2006 10:28:00 AM  
Anonymous Anonymous said...

grim,
your at a glance segments are they presented that way on the mls? example, listings back on market and above and below 500,000 or dyou have to search for that info?

4/15/2006 10:48:00 AM  
Blogger Simon Langer said...

Hi, I was surfing the internet and came across your blog. I'm quite impressed , with how it makes such good reading.

This is one to watch.

Many thanks,

las vegas condo

4/15/2006 11:14:00 AM  
Anonymous Anonymous said...

CNS:

I am the one originally raised the issue of 3%-9% appreciation, I am being courteous on that assumption, because in short time frame, the appreciation can be negative.

Thank you also for your analogy of using stock market for the housing market. Excellent point.

The housing market in the past few year has gone much crazier than the once bubbly stock market, since a large portion of the people in the housing market were heavily leveraging no matter they realized it or not.

4/15/2006 11:46:00 AM  
Blogger Metroplexual said...

Just another heads up in the Sunday NYT Jersey section there is an article on average interest income by zipcode in NJ. Also there is an article on the woes of the Mills corp. because of Xanadu.

4/15/2006 02:51:00 PM  
Blogger Online Degree Adviser said...

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Regards,

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4/15/2006 03:15:00 PM  
Anonymous UnRealtor said...

Marmar asks:

1) Interest Only Mortgages [AKA: a suicide loan]

Don't do it.



2) What to buy first? A rental property or a home to reside in?

Run the numbers. Last time I ran the numbers on a house that was both 'for rent' and 'for sale,' it was obvious the "owner" was losing $2,000 every month, not including property tax and maintenance costs (another $1,000 a month).

Don't be an "investor" landlord who loses $3,000 a month on his "investment."



3) 80/20 mortgages. Where both are financed loans.

Don't do it.


4) Realty Associate....How to find one that is GOOD.

Don't trust any of them. If you need to use one, understand they're not your friend, and have a vested interest in you buying immediately, and spending a lot of money.



From your post, it seems you're new to this blog? Stick around. Now is the worst time to buy any property.

4/15/2006 03:22:00 PM  
Anonymous UnRealtor said...

"Should we just accept the price made by the drunk sellers or present our more financially scientific bid?"


Neither -- now is not the time to buy a house.

4/15/2006 03:35:00 PM  
Anonymous RW said...

Annon with question on Iran

War with Iran IMO will ultimately result in a nuclear explosion in NYC in the next five years
...probably not great for NNJ realestate...

Grim
Congrats on your "you've saved us from making the hugest financial mistake of our lives" feedback. Must feel good to know you are making a difference. We should all cut you an appreciation check-I know you have said before that you would not feel right accepting $money$. Hope these stories offer much deserved reward!

4/15/2006 04:04:00 PM  
Anonymous Anonymous said...

a bit off topic, but on ridge rd/rt 3 westbound last night (10-11pmish) in rutherford there was a horrific car accident, with at least 20+ cars, does anyone know what happened? the car hit a tree in such a way that it made my stomach churn....

4/15/2006 04:20:00 PM  
Anonymous Anonymous said...

Anon 6:34 pm
"Let's see.. The S&P 500 averages around 12-14% annually."


Are you serious???
Please don't put out as fact total BS!

4/15/2006 05:51:00 PM  
Anonymous Anonymous said...

Outside of Grim, Unrealtor is the smartest person in the room!!!
Don't believe me, read what Unrealtor wrote on this thread at 4:35pm. He or she, definetely "gets it". I have said this before Has anyone written a check for a house before? (no mortgage)

4/15/2006 06:03:00 PM  
Anonymous Anonymous said...

Interest rate was reducted to about 5%, then house prices up due to reduced interest rate. Now interest rate is approaching near 7%. Interest rate increase by 40%. Expect the house price to drop pro-rate? Low demand and high inventory, and high interest rate will play key roll to reduce prices substantial.

4/15/2006 07:30:00 PM  
Anonymous Anonymous said...

Anon 8:30 pm you are soooo right.
I often ask people what's the difference between 5% and 7% They ALWAYS say 2%, including the well-heeled "smart guys". The fact is as you pointed out it is 40%.
ps: Long term average for 30 year money is up around 9%.

4/15/2006 08:02:00 PM  
Blogger Sharmin said...

I would like to see all these idiots who are paying excessive amount of money in trouble when market corrects.

4/15/2006 10:13:00 PM  
Blogger WArenter said...

Grim-

The defaults post was brilliant! It really drives the point home about all the insanity of this credit bubble.

4/16/2006 01:51:00 AM  
Anonymous Anonymous said...

Pulled this quote from someone who posted on Mortgage News Daily in May 05'...
"Calling real estate/building the only bright spot in the economy is like calling a new credit card a bright spot in your personal finances."
HILARIOUS!!! and very true.

4/16/2006 02:10:00 AM  
Blogger grim said...

Happy Easter!

4/16/2006 07:47:00 AM  
Anonymous Anonymous said...

Grim:
I just checked NJ.com for open houses. There are 713 listings open today.

Since this was my first time checking this, does this number seem very high to you or is the norm?

Thanks.

4/16/2006 08:03:00 AM  
Anonymous Anonymous said...

I saw two modular houses newly on the market in Warren.

Do anyone know what are the disadv. and adv. of modular houses, compared with regular houses?

4/16/2006 08:18:00 AM  
Blogger Shailesh Gala said...

Not directly related to RE, but indirectly it will come in to decision making.

New Jersey schools receive, on average, about 40 percent of their annual funds from the state, and 60 percent from local property taxes, while the national average is about 50-50. But those figures do not give the whole picture, because state aid generally amounts to less than 10 percent of the budgets in the wealthiest districts, while the poorest ones, called Abbott districts after a long-running lawsuit, rely almost exclusively on state aid.

In New Jersey, Spending Cap Pinches Schools

4/16/2006 08:44:00 AM  
Blogger pesche22 said...

just read the news today
the looting of the nj taxpayer
just goes on. what a disgrace.

where do you begin?

4/16/2006 08:47:00 AM  
Blogger Shailesh Gala said...

Reading all the posts regarding Agents, I wonder, if it would be possible to put together list of Questions that one can ask for selection of Buyer's agent and also for a particular house that one likes. Of couse, with questions, we should also write what we one should look for in answers.

4/16/2006 08:55:00 AM  
Blogger grim said...

At this point, I still feel it to be in the buyers advantage to wait.

grim

4/16/2006 09:56:00 AM  
Blogger grim said...

Open Houses on Easter Sunday?

grim

4/16/2006 09:58:00 AM  
Anonymous Anonymous said...

should a realtor give you comps as a buyer so you can see what is selling in your price range? or even some "at a glance type stats? should we just use listing prices as our guide?

4/16/2006 10:03:00 AM  
Anonymous gary said...

Happy Easter, all!

4/16/2006 10:05:00 AM  
Anonymous Anonymous said...

"should a realtor give you comps as a buyer so you can see what is selling in your price range? or even some "at a glance type stats? should we just use listing prices as our guide? "

Yes they should I often do, but it means nothing to the sellers. Soon it will soon......
KL

4/16/2006 10:41:00 AM  
Anonymous Anonymous said...

"Do anyone know what are the disadv. and adv. of modular houses, compared with regular houses?"


Modular homes have a lower resale value, and are also harder to renovate than standard construction.

Their basic advantage is a reduced up-front purchase cost.

4/16/2006 11:10:00 AM  
Anonymous Anonymous said...

Okay, now I've seen it all...

In today's Star-Ledger classifieds, someone is trying to rent a Livingston /West Orange condo as a vacation rental for $1000 a week.

Come on, admit it, you've always dreamed of vacationing in West Orange!

4/16/2006 11:17:00 AM  
Blogger 42 said...

Well, the Bayonne dump down the street finally sold, but I can't figure out how to find the sale price.

The house was vacant for a long time but the new buyer started gutting it out the other day. I figger the place went for about $400k and they'll have to put a minimum of another 100k into it because it's such a shitheap.

idiots.

4/16/2006 11:34:00 AM  
Anonymous Anonymous said...

For those of you whiners who think NJ is the pits when it comes to taxes, take a look at this.
It's not great, but there are far worse places to live in this country.

http://money.cnn.com/2006/04/10/pf/taxes/taxfriendly_states_2006/index.htm

4/16/2006 03:16:00 PM  
Blogger pesche22 said...

nj is the pits,, no questin about
it. quality of living,,, only worst is n,y.

4/16/2006 04:28:00 PM  
Anonymous Jess said...

Anonymous: Here is info on that car accident - poor girl, may she RIP

Passaic teen killed in high-speed crash on Rte. 3

Sunday, April 16, 2006

RUTHERFORD -- A Passaic woman was killed in a high-speed car crash Friday night, one day after her 19th birthday.

Jessica Sandoval was pronounced dead at the scene of the Route 3 crash involving a 1997 Honda Civic that witnesses said was traveling at 90-100 mph, said John Higgins, an assistant Bergen County prosecutor who is chief of the fatal accident investigation unit.


The vehicle was traveling in the center lane near Marginal and Daniel avenues and appeared to be moving into the left lane when it veered to the right and crashed off the roadway, striking several trees, Higgins said.

The driver, a 17-year-old boy, also from Passaic, suffered a lacerated liver and broken bones. He was being treated Saturday at Hackensack University Medical Center. Two back-seat passengers, both juvenile girls, were being treated at St. Joseph's Hospital and Medical Center in Paterson for injuries that were not life-threatening, Higgins said.

The driver faces reckless driving and speeding charges, Higgins said. Officials do not believe drugs or alcohol played a role but are awaiting the results of toxicology tests, he added.

-- Allison Pries

4/16/2006 04:32:00 PM  
Blogger Grim Ghost said...

Shailesh -- I would suggest buying Ilyce Glink's book 100 Questions Every First-Time Home Buyer Should Ask

4/16/2006 05:19:00 PM  
Anonymous Anonymous said...

Shailesh...where did u go to after u left ur last company? Rob/George mentioned that u left.

4/16/2006 06:06:00 PM  
Anonymous Anonymous said...

Got a couple realtor's call today, offering to take me out for house showing, some even confessed that they haven't had any transactions for months...have a feeling that the market is changing rapidly in the favor of buyers.

4/16/2006 06:47:00 PM  
Anonymous UnRealtor said...

"Got a couple realtor's call today, offering to take me out for house showing, some even confessed that they haven't had any transactions for months."


As Bob would say:

http://www.beebfun.com/sounds/ag.wav

4/16/2006 07:00:00 PM  
Anonymous Anonymous said...

Lots and lots of FSBO signs!

These are not counted in inventory right now.

It's looking depressing for sellers and straving realtors.

Booooyaaaaa!

Bob

4/16/2006 07:27:00 PM  
Blogger grim said...

Sorry I haven't been around much today everyone. Was busy with the family earlier, and now I'm working on an economics paper.

Is it just me or is there never enough time in the day anymore?

grim

4/16/2006 07:32:00 PM  
Blogger grim said...

Do you guys/gals want an online chat or message board?

While this system makes blogging easy for me, it makes comments and discussions an absolute horror for everyone else.

grim

4/16/2006 07:34:00 PM  
Anonymous Anonymous said...

This discussion format works.

Whatever is easiest for you to maintain sounds like the best solution.

4/16/2006 07:50:00 PM  
Blogger njresident286 said...

I agree with the above Anon- whatever is easier for you Grim works. This format seems to keep everyone on topic pretty well, and then the weekend disucssion allows everyone to get Off Topic. I think for now it is working well, but I am up for anything

4/16/2006 07:55:00 PM  
Anonymous Anonymous said...

Grim: I have quite a bit of experience setting up online message boards for various sites.

A message board to compliment this blog would be great as it would allow us to start our own topics.

I'd recommend the open source project beehive for the software. http://beehiveforum.sourceforge.net/
Example of a site using such software: http://www.pr0kforums.com

You have alot of options in terms of forum software choices. vBulletin is nice, but not free. DCForum is another nice commercial option offering a threaded view.

It should not take more than a few hours to setup.

I can provide assistance if you need. cdavid at hot mail dot com.

Regards,
ChrisXS

4/16/2006 10:44:00 PM  
Blogger skep-tic said...

biggest advantage for buyers is no one needs to buy. there are always some people who have to sell.

make everyone involved in the transaction aware that you don't need to buy this house. the seller, the realtors-- everyone. lowball them without remorse. when yours is the only bid they get for three months, their brains will start itching.

4/16/2006 11:18:00 PM  
Anonymous Anonymous said...

Message Boards PLEASE.... it would make it much easier and organized to stay on topic.

4/17/2006 12:57:00 PM  
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Anonymous Anonymous said...

. Never Stay In Your House With House Hunters: Let the agent handle it, and remove yourself if possible. Remember that the Realtor� has worked many hours with these people, and knows what they're looking for, and how to work with them. Let the Realtor� do the job without interference.You may feel that an agent isn't showing the important features of your home to the prospect, but the agent knows people aren't sold by details until they've become emotionally involved with the "big picture" of your home. The presence of any member of the seller's family can't help. It always unnerves possible buyers. It often prevents a sale.
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6/22/2006 09:19:00 AM  
Anonymous Anonymous said...

You can do a lot to For example, curb appeal sells: do some landscaping. Plant some flowers. Remember that the front door greets buyers. Make sure it offers potential a bright, warm welcome.

6/22/2006 03:07:00 PM  
Anonymous Anonymous said...

I can never spend enough time blogging because I�m busy with my own real estate work, but I enjoyed your site. Too brief a visit, but thanks for the insight. Visit my site if you have a chance.

6/23/2006 11:41:00 AM  
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6/23/2006 06:13:00 PM  
Anonymous Anonymous said...

. Pets Underfoot? Keep them out of the way ... preferably out of the house. Many people are acutely uncomfortable around animals. Nothing can stop a sale faster than man's best friend, wagging its friendly tail at a prospect with an allergy.
Go here for more ideas.

6/23/2006 07:32:00 PM  
Anonymous Anonymous said...

You can do a lot to For example, curb appeal sells: do some landscaping. Plant some flowers. Remember that the front door greets buyers. Make sure it offers potential a bright, warm welcome.

6/24/2006 10:23:00 PM  
Anonymous Anonymous said...

. Silence Is Golden: Be courteous but don't force conversation with a potential buyer. He wants to inspect your house, not pay a social visit.
Go here for more ideas.

6/25/2006 06:51:00 PM  
Anonymous Anonymous said...

If you're selling your home, consider . Faded walls and worn woodwork reduce a lot more than house appeal. They cut into your price. Invest in a few cans of paint. Brighten up the interior. .

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. Noise does not sell well. Let the Realtor� and buyer talk, free of disturbances. Background "soft playing" music is okay, but the wrong sounds will turn buyers off. Noisy children and animals are roadblocks to a contract � and traffic, trains, and planes must be dealt with honestly, if they are part of the deal. Go here for more ideas.

6/27/2006 09:21:00 PM  
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6/28/2006 03:13:00 PM  
Anonymous Anonymous said...

In this "cooling off" real estate market, suggest that the average residence is shown about 4 times a week during the first 3 weeks of a real estate listing. After that, an unsold home goes "stale" ... it gets shown less .

6/29/2006 04:11:00 PM  
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Anonymous Anonymous said...

Hint #8 for . Clean Your Closets: Neat, well ordered closets look bigger, suggesting that storage space is ample. One of any home's biggest deal-killers remains: "Not enough closet space."

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Anonymous Anonymous said...

In this "cooling off" real estate market, suggest that the average residence is shown about 4 times a week during the first 3 weeks of a real estate listing. After that, an unsold home goes "stale" ... it gets shown less .

7/06/2006 08:32:00 PM  
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7/07/2006 10:37:00 PM  

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