Jersey Housing Sales Dive
From the Star Ledger:
Housing sales dive 16.3% in Jersey
Housing sales dive 16.3% in Jersey
June is a pivotal month in the housing market -- the grand finale of the busy spring house-hunting season.
More than any other time of the year, it's when homebuyers call their agents, book home tours and turn up at open houses, setting the high-water mark for homes sales in any given year.
But, apparently, not this year.
The National Association of Realtors said yesterday home sales in New Jersey tumbled 16.3 percent during the second quarter as more homebuyers, discouraged by higher home prices and interest rates, dropped out of the market. During the quarter, 157,900 homes were sold, down from 188,600 a year earlier.
Prices, which are released for metropolitan areas rather than on a state-by-state basis, have held up, although the increases have moderated substantially and in Central Jersey they actually fell, the NAR reported.
"There is still little evidence of collapsing housing markets, although we are early in the downturn of the housing cycle and the weakening is going to play out over the next year or two," added Celia Chen, director of housing economics at Moody's Economy.com, a research company in West Chester, Pa.
...
"The weakening of the residential real estate market is occurring primarily in the coastal markets of the country, including New Jersey, because the increase in prices in the coastal markets have been greatest over the last seven years and thus the affordability squeeze is exaggerated here," said Jeffrey Otteau of East Brunswick-based Otteau Appraisal Group, who also authors a series of widely followed quarterly market reports on the New Jersey real estate market.
...
Otteau said that June is the "traditional end point of the all-important spring selling season," and typically sets the tone for home sales in any given year.
"Thus the residential market in New Jersey had much at stake as any hopes for a market comeback would fall heavily on June sales performance," he said.
In New Jersey, the number of homes that were contracted for sale in June ran 9 percent below May and 24 percent below June 2005, Otteau said, "continuing the pattern set earlier this year and dimming hope for a market comeback anytime soon."
81 Comments:
ARMS .....SHWARM...
There are HUNDREDS of other places to "find" money, without putting Lassie to sleep (Which would cost $300 as well)
Cut out:
Starbucks. $100/mo
Gym membership $100/mo,.
Some new Clothes: $100/mo
Increase deductible(s): $100/mo
Abort Whole Foods: $100/mo
Buy generic grocery stuff: $100/mo.
Share a cell phone: $50/mo
Cancel cable: $50/mo
Lower the heat: $50/mo.
Cancel vacation: $300/mo
List is endless. That's just $1000/mo. off the top of my head.
People will be find.
Put the crash helmets away.
Do you honestly think there can be a huge pullback in consumer spending without a massive impact on our economy?
So what happens on the macro-level when these spending cutbacks take place?
Starbucks profit falls, they lay off workers or close stores because of the reduced demand.
Gym profits fall, they lay off workers, cut back hours, or worse, shut the doors.
Retailer profits fall, layoffs take place. Manufacturer profits fall, layoffs take place.
Whole foods profits fall, they lay off to compensate. Perhaps a handful of small organic grocers go under as well.
Verizon and Cablevision (Comcast) profits fall...
I think you see the pattern here.
But wait, there's more!
You now have a second group of people who are going to cut back their spending because they lost their jobs. This gets fed back into the economy, further exacerbating the downturn. Don't ever discount the negative multiplier effect in an economy with an incredibly high marginal propensity to consume..
grim
...and please don't post the same comment to multiple threads unless it's absolutely necessary to.
grim
Nice summary, Grim. This kind of widespread economic pain is also going to happen if home prices fall by 30%. Consumer spending by the middle class has been fueled by growth in home equity, not rising incomes. When that falters, whether due to mortgage adjustments or to a decline in available equity, we are ALL going to feel pain. The gloating on this site over the impending fall seems to ignore the broad economic effects this will have. Unemployment will rise, public assistance costs of all sorts will rise, retail and service stocks will dive, our kids will have an even hard time "launching." (I graduated in 1981--I know what starting off in a recession feels like!) Those who do not own RE will protect more of their assets, but we will likely all be feeling the pinch, and many, many will feel real pain.
Discussing the paradox of thrift is always relevant in these types of discussions. I don't really want to get into a Keynes discussion here, only to use the paradox as a tool to help realize that spending cutbacks and increases in savings can have a potential negative effect on the economy.
The Paradox of Thrift
The paradox of thrift is a paradox of economics propounded by John Maynard Keynes. The paradox states that if everyone saves more money during times of recession, then aggregate demand will fall and will in turn lower total savings in the population. One can argue that if everyone saves, then there is a decrease in consumption which leads to a fall in aggregate demand and thus lead to a fall in economic growth.
That NAR report had lots of interesting info.
In a comment on Ben Jones' blog yesterday I noted that if you add the NJ decline (and throw in the likely decline in NY and Pa.) to the five states that reported the largest decline, you have at least a 20 percent sales drop in states with 1/3 of the country's population.
The only large state which saw a significant increase in sales was Texas, up 11.3 percent. The nation's sales growth leader was Alaska, up a whopping 48+ percent.
Of course Alaska has about the same population as Monmouth County.
The other thing to note from that report is that what does not go up so much also comes down.
While prices in the Northeast (+6.3%), South (+4.1%) and West (+3.6%) were reported higher in the Midwest prices declined (-2).
This is going to be, to borrow from ZZTop, bad and nationwide.
Lindsey
Adding...
BTW, the NAR put the national level of sales decline at 7 percent. Based on what we know about most of the largest markets, and anecdotal info from many others (Mass, and the Pacific NW come to mind) that number seems awfully low.
Lindsey
Housing Starts and Permits came in under estimates..
U.S. Home Starts Fall to Lowest in Almost Two Years
Home construction in the U.S. dropped last month to the lowest level in almost two years after higher mortgage rates slowed sales and left builders with bloated inventories.
Housing starts fell 2.5 percent, more than forecast, to an annual rate of 1.795 million, a Commerce Department report showed today. Building permits, a sign of future construction, declined 6.5 percent, the most since September 1999.
The decrease in residential construction, which accounts for about 6 percent of gross domestic product, bears out the Federal Reserve's forecast that housing will slow the economy. Homebuyer affordability at the lowest level since 1989 has reduced demand and prompted builders such as Pulte Homes Inc. to slash earnings forecasts.
``Negative builder sentiment and a large inventory of unsold homes suggest that construction firms will be reluctant to start new projects'' in coming months, said Mike Moran, chief economist at Daiwa Securities America Inc. in New York.
Economists expected starts to fall to an annual rate of 1.808 million from an originally reported 1.850 million pace in June, according to the median of 58 forecasts in a Bloomberg News survey. Estimates ranged from 1.76 million to 1.89 million.
Building permits dropped to an annual rate of 1.747 million, the lowest level since August 2002 and less than the 1.84 million median forecast in the Bloomberg survey. Permits in June declined to a 1.869 million pace.
Got pull teeth out of these so called "experts" to admit that the real estate market is tanking.
I'm a new reader and am very much appreciating the commentary here. My thought is that if housing prices drop here (I am in Rutherford), won't there be a wave of returnees from the Stroudsburg area to contend with?
I seriously considered moving to the foothills of the Poconos and commuting in to Midtown...
Who'd want to drive from, say, Easton PA with gas over three dollars when they could live cheaply in this charming but grotesquely overpriced town?
Perhaps I'm leaving property tax out of the mix? The condo glut? The huge "investment" inventory?
Otherwise, unless NYC becomes ugly again, we are likely to see continued demand. Same s**t, different demographic.
In other words, won't the continued desire to live close to La Manzana Grande tend to offset price drops?
Thanks for your thoughts...
ARMS .....SHWARM...
There are HUNDREDS of other places to "find" money, without putting Lassie to sleep (Which would cost $300 as well)
Hahaha
There is a cost when the consumer cuts back. So when the housing market BUSTS.....landcapers, plumbers, electricians, mtg brokers, realtors, builders, appraisors and bankers are impacted. it filters down into the economy. Then you cut back on other items then other FOOLS can't pay their bills.
ARMS .....SHWARM...
There are HUNDREDS of other places to "find" money, without putting Lassie to sleep (Which would cost $300 as well)
Hahaha
There is a cost when the consumer cuts back. So when the housing market BUSTS.....landcapers, plumbers, electricians, mtg brokers, realtors, builders, appraisors and bankers are impacted. it filters down into the economy. Then you cut back on other items then other FOOLS can't pay their bills.
Many FOOLS have a slim margin of error to stay afloat.
I have another 'marathon' meeting today. Feel free to use this thread as an open discussion of any topic that pops up this afternoon.
jb
Otherwise, unless NYC becomes ugly again, we are likely to see continued demand. Same s**t, different demographic.
In other words, won't the continued desire to live close to La Manzana Grande tend to offset price drops?
Thanks for your thoughts...
This is a fact. Why in 1989 a friend bought a NYC co-op farily desirable area and the Co-op collapsed in price. As a matter of fact he did not breakeven until about 1998-1999 about 10 YEARS LATER. At one point he said he could even sell it at 50% discount.
NYV+C prices go down as they are right now. just to many unethical poeple out there who rely on RE for a living twisting and spinning away to keep the truth from fully being realized at this time. But the secret mis gretting out.
To bad pumpers.
Anyone notice the hostility level is rising. Back in 1993 the realtor harassment level was very very high. They would literally attack you if you looked at a house. When you are starving you get desperate. Desperation for a commish check is growing..
BOOOOOOWHOOOO!
Rather than cutting back the gym, and becoming like the rest of this obese country, find a cheaper gym.
My wife and I belong to the YMCA in Long Island City and pay $71/month.
Saving cash is fine, but not at the expense of health.
Anonymous said...
"This is going to be, to borrow from ZZTop, bad and nationwide.
Lindsey"
One of the all-time greats. Nice job Lindsey.
"I've got a girl that lives on the hill, she won't do it but her sister will...."
Rutherford? Charming?
Maybe compared to its neighbor, Kearny.
Anonymous said...
"Rutherford? Charming?
Maybe compared to its neighbor, Kearny"
I agree with the previous anon, Rutherford is charming. It is a great town with a ton of old victorian's. (I am not in any manner justifying their home prices) There are a lot of great restuarants and a nice downtown. The location is great, 8 mi. to NYC, with a NJ Transit stop. By the way, its neighbor is not Kearny. To the south you have Lyndhurst and North Arlington. Saying that Kearny is its neighbor is like saying that Lyndhurst's neighbor is East Newark. Not accurate at all.
BC Bob
Thanks to anon who stuck up for Rutherford!
One more thing: there's NO STARBUCKS here!! But there's a butcher, a baker, The Village Gourmet, and a nice Episcopal church, if that happens to float your boat. And parades and block parties...
As far as transit, even better than the NJ train is the 190 bus. Without traffic, it's under 20 min to the Port Authority.
Still, prices are loony tunes. There is a "cape" offered at 385K right now, that by any sane standard is worth 85K.
I do notice condo prices becoming steadily more manageable.
Thanks again!
{{Cut out:
Starbucks. $100/mo
Gym membership $100/mo,.
Some new Clothes: $100/mo
Increase deductible(s): $100/mo
Abort Whole Foods: $100/mo
Buy generic grocery stuff: $100/mo.
Share a cell phone: $50/mo
Cancel cable: $50/mo
Lower the heat: $50/mo.
Cancel vacation: $300/mo}}
Would anyone in the NYC metro area do this?? NOT A FUC*ING CHANCE IN HELL.
Not to mention all the 'designer clothes' everyone wastes money on. That is probably $2,000 - $5,000 for the average 20 something male outside of Manhattan.
You think people spend $100 a week on clothes.. Try $100 a day maybe on one shirt, or likely $500 or more a week.
Not to mention all the clubs, bottle service, parking in midtown..
YOU CANNOT economize in this region without feeling inferior.
What is the point of living in this city if you need to go car free and can only window shop??
The MTA, PATH & NJ Transit are good for rush hour only. Certainly not good for weekends or outside of rush hour when a car becomes a necessity anywhere in this area
7.1% INCREASE IN MEDIAN HOME PRICES in north jersey! Don't be fooled.
Source: http://www.nj.com/news/ledger/index.ssf?/base/news-8/115570277648590.xml&coll=1&thispage=2
Meanwhile, home prices in the Newark metropolitan region -- a six-county span that includes Essex, Union, Morris, Hunterdon and Sussex in New Jersey and Pike County, Pa. -- rose 7.1 percent in the second quarter of 2006 to $443,800.
Economizing in this part of the country?? F***CKING laughable.
If you don't have a trust fund or work on Wall Street, it is prohibitive to even rent an apartment in Hempstead, Elizabeth NJ or Jersey City.
sorry--me again--when I mentioned Stroudsburg and Easton, I know many NYCers who moved there to get houses in the 100 to 150K range. Their plan was either to commute or relocate altogether.
Commuting is no longer attractive, given transportation costs. And what a lot of time it takes! Do they ever see their new homes in daylight?
Personally, I turn off 80 in East Stroudsburg, right off the Delaware River, to go to the McDonalds...and get back on 80.
rentinginnj has a good point--who's going to help out the "returnees" I was envisioning? If the tide goes out, they're going to be high and dry. Conversely, we may remain under water.
Thanks again--
RichInNorthNJ
Thanks!!!
This is starting to look like the electronic billboard at Times Square, which indicates our huge, mounting debt.
Thanks again for the great work.
BC Bob
I have been getting alot of emails from bloggers asking me what to do if they don't have very much cash.
So, this is what I think you should do:
If you have less than $10,000 in cash. You should not be in the stock market or anything else but get yourself a high interest saving account of CD account. I just saw a %6.0 one yesterday. Save cash, reduce lifestyle, and make sure you are matching your
401(k) contributions, if your work provider doesn't have a 401 program, open yourself up a ROTH IRA today. Always helps reduce the tax burden.
If you have less than $10,000 your mindset should only be in cash savings and nothing else. Start today and make 10,000 your goal, once you get to that point, then some of you can email me some more.
And for those whom email me whom have over 1e6 in cash reserve, I would still consider diversify out of the dollar. How much varies on peoples comfort level. I have been going with Middle Eastern currency myself....Turkey has been doing good for me.
**This is just my opinion, do the research yourself to help draw your own conclusion, I am just giving ideas because I get many emails a day from people on these blogs**
SAS
NJGal said...
"Not to mention all the 'designer clothes' everyone wastes money on.
Seriously, can we drop this already? It's an overassumption at best, smacks of jealousy and is just plain annoying - you post it on every thread. It lends nothing to the discussion (except for allowing a few of us to laugh over $300 jeans every now and again:)
8/16/2006 10:38:23 AM"
YEAH, NJGAL!
Besides, some of us work for companies that sell said jeans!
Abort Whole Foods: $100/mo
Buy generic grocery stuff: $100/mo
Buying selectively at Whole Foods and remaining on a budget $2,400/year [by your tally].
Avoiding TYPE II Diabetes, ADHD in kids, food allegies, pre-teen puberty, heart disease.
PRICELESS
Don't be penny-wise/pound-foolish.
You will pay the grocer or your will pay the pharma companies.
Read the book Fast Food Nation.
Food in this country is essentially an edible version of tobacco.
Here is how I am preparing for a slowdown....
1. Have no credit card debt
2. Have an emergency fund of 3-6 months cash in a money market fund
3. Increase my bond allocation slightly to provide a cushion should equities take a sudden tumble.
4. Keep my equity portfolio in taxable account to tax-loss harvest; diversify out of the US dollar by increasing my intl equity allocation to 50%.
5. Live below our means, continue renting, and dissuading my wife it's wrong!
6. Pray I hold my job.
Amen, Chi. Great book.
Although, I do still allow myself a Big Mac once a quarter!
dreamtheaterr:
1. I have a credit card, but only for credit score maintenance purposes. Comes in handy, too.
2. Conservative husband likes us keep a year of expenses in MM. I guess it won't kill us, but sometimes it's tempting to play with it...
3. Bonds? We did also, but probably not to the percentage recommended. I'm too much of a risk-taker.
4. Ditto
5. Ditto, except I'm the wife.
6. Ditto, because I enjoy my job.
Isn't it funny how more people have many things in common than they think, including preparing for recession?
----
Chicago..on the exercise thing, I find power housecleaning 3x weekly helps for free. But no stopping for an hour and the floor must be hand-scrubbed. Being a cheap person and a clean freak may have a healthy side effect.
---
OTS - skip to bottom if you're not into details. And you probably already know this if you're not from down here in "the country."
Be careful at Wawa/7-11/other places with cash machines that do not have cameras rolling. I was at a busy store (Ocean County), made a withdrawal, turned, and noticed a man, 20-ish, hat, jacket, big backpack with electrical cord. Many cargo pockets.
He was 8 feet behind me, leaning on a cooler chest, staring at me, and frantically typing numbers using the two-thumbed method into a small gadget similar to a crackberry 7290. It was aimed at the cash machine. I ambled over to the coffee pots and watched him do this to five other people, told the manager and walked out of the store to my car. A few minutes later he scooted out and met up with someone else with a huge backpack, walking away.
-----
Short version..called the bank, bank says they have a problem with this in NJ. Dudes have mag tape spliced into the machine, read your card number as you slide it, and they are frantically typing 4-digit PINS into a hand-held reader as they watch your arm motions, trying to get your PIN. They read the elbow movement.
Rep says they sent my voice tape to security, and that it's funny they don't get more of these reports...people are afraid to accuse other people.
Pat
OT: Fast Food Nation.....I am more concerned about what you buy at the supermarket than restaurants per se. If you think about McMansions, well think about McFood. You take an organism and attempt to apply cost-efficiency into production and marketing into sales.
Ten years ago I was at a recruiting trip to Kraft, and it was eye opening. Imagine a person who is trained identically to an investment banker, except their mission is to maximize the amount of cheese you eat, and producing it in the most cost efficient way. Who cares if you end up with tons of carcinogens coursing through your veins, stressing out your bodily organs, and bloat your body.
Fight back with your intellect and self-determination.
c'est ne le une bubble:
Talk about surreal, this guy nails it, re: Kubler-Ross for bubble-heads:
http://www.washingtonmonthly.com/archives/individual/2006_08/009348.php
Money quote:
"The same psychology that keeps prices rising during a bubble also mercilessly drives them down when the bubble is over. After all, who wants to buy a house if it's not going to appreciate? We should expect bumpy weather ahead."
ps: last post--Kevin Drum on the Kubler-Ross scale--from Jamey.
READ THIS POST AGAIN BUBBLEHEADS. SOME OF US REMEMBER THESE DAYS AND BENEFITTED BIGTIME.
JUST READ IT. THOSE IN DENIAL WILL GET BURNED.
GOOD POST!
RichInNorthNJ said...
7.1% INCREASE IN MEDIAN HOME PRICES in north jersey! Don't be fooled.
I’m not sure what your point is, but here’s a little history courtesy of Grim’s site, Home Prices Do Fall
New York Area Remains Costly
August 16, 1988
“…In Bergen County, N.J., the average list price of a single-family home was $409,865 at the end of July, compared with $372,107 last year.
Although prices remain high compared with those in other areas of the nation, there are more homes being offered on the market.”
Home Prices Increase 3.4%
February 15, 1989
“Prices of existing homes rose 3.4 percent last year, but despite the moderate increase, many first-time buyers are being priced out of the market in some areas, a national real estate group said today. Prices of existing homes rose 3.4 percent last year, but despite the moderate increase,...”
Working to Bolster Residential Sales
September 10, 1989
"The home-buying market needs new blood to remain healthy,'' she said. ''Sales have been flat across the tristate area."
Buyers Hang Back in Muddled Market
January 28, 1990
"A TWO-YEAR slump in property values has pushed down home prices in the New York region and mortgage interest rates also have fallen, but the reductions show little sign of attracting the huge numbers of buyers who were locked out of the region's giddy real estate market in the mid-80's."
It’s not a matter of if, it’s a matter of when.
Rich
8/16/2006 11:04:44 AM
The author of Fast Food Nation, Eric Schlosser, will be speaking at Ramapo College in Mahwah on September 8th for Opening Convocation. His book was chosen as the summer reading for incoming freshman.
If any of you are interested in attending, let me know.
Karen
karensternos@gmail.com
anon @ 8/16/2006 10:31:27 AM
"YOU CANNOT economize in this region without feeling inferior. "
You obviously have issues beyond the purpose of this blog and probably should relocate to feel better about yourself.
8:57 said, "Many FOOLS have a slim margin of error to stay afloat"
Do you think this has to do with a form of risk-taking behavior that in some environments would serve the species well?
What is the benefit to this behavior? There has to be some benefit to the human race, or so many humans would not be such sheep about their finances and the Joneses.
Maybe in pre-historic times, humans saw other Jonesoids piling up chestnuts for the winter?
From Newsday:
Experts say LI housing is headed for modest annual price declines, probably within months
The downturn is coming.
In all likelihood, it won't be severe and it won't be devastating to most homeowners. But Long Island's housing market is heading for annual price declines - probably in the next few months, experts said.
For the first time since 1997, Nassau County saw a flat housing market last month, with prices remaining exactly where they had been one year ago - at a median of $490,000, according to the latest data from the Long Island Multiple Listing Service. Suffolk County's median price of $410,000 represented a 2.5 percent increase over a year ago.
Over the past year the data each month have painted a clear picture of a slowing market, one that is now tilted fully toward home buyers. The time it would take to sell the entire housing inventory has gone from seven months a year ago to 12 months in Suffolk County, as of last month, and from six months to nearly 11 months in Nassau, according to a Newsday analysis. The supply has not been that high since 1997.
Meanwhile, houses under contract appear to show where the market is heading: Nassau County saw a 4.3 percent decline year-over-year in the under-contract median price, to $478,300, while Suffolk's prices remained flat.
(cont)
So the question becomes: How much will they soften - and for how long?
The market could be in for three to five years of flattening or declining prices, said Pearl Kamer, chief economist for the Long Island Association. If prices decline, "it will be a gradual adjustment," she said, anticipating annual decreases in the 3 percent to 5 percent range.
Experts said this market has not begun to mimic the downturn of the late 1980s and early 1990s, when prices plummeted. The difference? "There's no panic," said Linda Bonarelli, a broker-owner with Re/Max North Shore in Huntington. "And there's no reason to panic."
Indeed, interest rates and unemployment both remain relatively low. Housing market expectations are predicated on the notion that those indicators will stay low - and that the overall economy will expand or remain stable.
"There's no cushion left," said Martin Cantor, chief economist for Sustainable Long Island, a Garden City advocacy group. "We could see layoffs and less profits, and wages are lagging behind. That all accounts for less demand in housing."
The headline: "Experts say LI housing is headed for modest annual price declines, probably within months".
The "experts" cited to support "modest price declines" aren't particularly compelling: two realtors and two economists that appear to have some agenda on the line.
The table at the end of the article was interesting:
------------------------------
Percentage changes in the median prices of homes in Nassau, Suffolk and Queens. Figures show price changes in July over the previous July. For example, the 0.0% figure for Nassau in 2006 means prices there are unchanged from July 2005.
NASSAU
2000: 13.94%
2001: 8.74%
2002: 26.79%
2003: 12.68%
2004: 9.33%
2005: 12.05%
2006: 0.0%
SUFFOLK
2000: 13.89%
2001: 16.08%
2002: 25.23%
2003: 17.95%
2004: 9.47%
2005: 13.48%
2006: 2.50%
QUEENS
2000: 13.76%
2001: 2.79%
2002: 20.81%
2003: 23.60%
2004: 13.64%
2005: 17.33%
2006: 13.57%
SOURCES: MULITPLE LISTING SERVICE OF LONG ISLAND
Two links at washington times re: DC realtor (april, 2006) and today (August 16, 2006) What a difference 4 months makes in the newspapers?
http://www.washtimes.com/business/20060413-105214-3474r.htm
http://washingtontimes.com/business/20060816-121021-7703r.htm
================
"There's no panic," said Linda Bonarelli, a broker-owner with Re/Max North Shore in Huntington. "And there's no reason to panic."
================
Holy shmoley - she used the "P" word.
It actually scares me to see a realtor says something so goofy. This comment makes me believe that conditions over there are so much worse than we have been envisioning.
Run, do not walk, for the exits.
Cross off 2006 - beware the false bottom.
chicago
Human nature has not changed over the "Centuries.
I see some really deep thinking on this board today.
Now if the last of the "FOOLS" (Bagholders) would do the same thing then just maybe this deep housing correction would have a shortened lifespan.
BOOOOOOOOOOYAAAAAAAAAA
Bob
RAISE YOUR HAND IF YOU BOUGHT IN LAST 12 MONTHS.
JUST WANTED TO LET YOU KNOW YOU ARE A BAGHOLDER!
BABABABA
BOOOOOOOOOOOYAAAAAAAAA
Bob
Lindsey, I've had that feeling about the numbers for a long time, and reverted to the old gut in April. It's been serving me well. I've even stopped my own charting exercises.
===============
RE: "Panic"
I hope that doesn't make Bob feel unneeded. Bob, you are not being replaced by some perfume squirter. I like your spelling of papapapaannnnic better.
Pat
Holy Houseburning, Bobman, beat me to the punch..saw it in edit mode.
You can feel it.
The desperation of spec/flippers getting squeezed each month with cashflow problems.
The desperation of a starving realtor looking to make a commish check this month.
IT'S NOT GOING TO GET BETTER!
THE EXITS ARE SHUT AND YOU CAN;T GET OUT.
PAPAPAPAPA
PANIC
Bob
Chicago,
Amen to that!!!!!! Plan your strategy in 2006, certainly not time to execute it. This will be like a herd of elephants trying to escape through a small exit at the same time. Don't walk, don't run, sprint!!!!!!!
BC Bob
NO REASON TO PANIC?
WRONG.
BETTER ACT FAST BEFORE
POOOOOOOOFFFFFFFFFF IT EVAPORATES BEFORE YOUR EYES.
PAPAPAPA
PANIC!
Bob
So if I am converting
i can go with a
30 year fixed
30 year fixed (10yr interest only)
40 year fixed.
and I'm out of the woods??
comments please
DON'T WORRY CUZ MR. DAVID SAID THE HOUSING MARKET IS GOING BACK TO NORMAL.
EVER GO TO A PARTY AND IT'S WILD. YOU THINK THE BIGGEST PARTIERS ARE NOT HUNG OVER THE NEXT DAY?
PLEEEEZZZZEEEEEEE
HIS NOSE KEEPS GETTING LONGER WITH EACH COMMENT.
WHAT FRIGGEN MANIPULATION!
iT IS TOTALLY DISGUSTING THAT ETHICS IS A PRIORITY AT LEAST THEY SAY SO. NOT!
PROTECT YOUR OWN ASSETS FROM THESE SHEISTERS. NOONE WILL DO IT FOR YOU. THEY WILL HELP THEMSELVES TO EMPTY YOUR POCKETS.
THINK!
Bob
bleed'em dry!
If you have real assets do not look inquire or bid. why?
here's why.
“Jennie and David Garcia are testing the housing market again. This time the Yucaipa couple are asking significantly less for their five-bedroom Yucaipa home. Their house didn’t sell after a four-month effort ending in July. The Garcias don’t want to lock in some of that appreciation on their Yucaipa house in the past two years. ‘We are afraid the market is going to go lower,’ Jennie Garcia said.”
“In March, they listed their home with a real-estate agent for $509,000. ‘The first week we had four or five lookers. After that there was nothing. It was pretty bad,’ she said.”
“Last week they decided to make another stab at trying to sell the house, this time on their own. The asking price is now $468,000. Two people showed up at an open house over the weekend. ‘Better than nothing,’ she said.”
“‘We are not near the bottom,’ said economist Christopher Thornberg, a senior economist at UCLA. ‘Anybody who bought a home in the last year and was hoping for appreciation to bail them out is in for a rude awakening,’ he said.”
Give them NO HOPE!
Buyer/seller positions have reversed and it ain't fun. Get USED to it cuz blood has just started to flow. Go for the throat. It's all business.
Sorry it ain't a ONE way street.
You buy now or in the past 12 months you are a BAGHOLDER!
Expect losses if you want to sell in next 8-10 years.
It took one person i knew 10 years to BREAKEVEN ON A NYC CO-OP. 1989-1999.
10 YEARS!
Today's housing market is more Insane than 15 years ago.
BOOOOOOOOYAAAAAAAAA
Bob
at one point the co-op was down 50% in value and he probably couldn't sell it then anyway.
nobody wanted it!
psychology & affordability plays huge role in markets. Both these things are really BAD in this bloated housing bubble market.
Papapapa
Panic
Bob
to whomever was mentioning that cape in rutherford for $385K being worth $85K...I saw it and it is tiny. however, I personally know the broker on that house (assuming we are talking about the same one) and it has sold for near asking (no joke)....just goes to show you.
Karen,
I would like to goto that things in Ramapo.
What is the link?
SAS
Math, that was me (no time to log in earlier).
Have a look at this desperate seller,
MLS 2306990
119 Cypress St
Millburn NJ
http://www.realtor.com/Prop/1065857898
Aug 6 - $675,000
Aug 16 - $635,000
That's a $45,000 drop after only 10 days on the market!
This seller must have been spooked by the Ghost Town since no Greater Fools signed up for debt slavery.
Fast Food Nation did such a great job of indicated how TASTY Fast Food is....that I eat more than ever....I have run a marathon, and hit the gym 6 days a week. (Swim, Pilates, Yoga, Weights, Running, Spin) I LOVE FAST FOOD b/c of that book.
> YOU CANNOT economize in this region without feeling inferior.
Bullshit. From age 21 to 30, I earned $30k->$50k->$90k->$200k+. I never bot a new car. Never spent much on clothes. Lived in a very small apt. etc.
I banked over $500k by 30.
Then, (and only then), I bot my 1BR apt for $85k with cash. Dumped in $15k to renovate. My monthy cost for a fully renovated apt = $500/mo.
Plan ahead, and you will have options. If you pay more than $30 for jeans, or $40 for a watch, you WUZ robbed!!
Oh, and I also work a lot less now. B/c those spending habits don't change.
Call me cheap.
Or you can call me Buffett.
He thinks like this too.
I don't care about sales' drops. I want to see price drops!!
Price drops are happening.
No price drops in hoboken cept in unsavory locations. im fed up and ready to leave this overpriced town.
"From age 21 to 30, I earned $30k->$50k->$90k->$200k+. "
Just curious, what was your major in college? Are you a Wall Streeter?
What legal actiities can one participate in to "bank over $500K" by 30?
I also managed to put away almost 500k by 30. I did it by living at home until I was 25 (my parents wanted me to stay longer). When I moved out, it was into a small apartment at $410 per month. I managed to save the difference and bought a home in 2000 with a huge downpayment. I never made more that $100k in my twenties.
Made the mistake of buying an expensive watch. Never again. Expensive cars and watches are expensive to maintain. However when I get the urge to waste money on something frivolous, I just have to look at my wrist to serve as a deterrent.
Richie, a project manager having "over $500K" saved in the bank by 30?
And Anon wrote:
"I also managed to put away almost 500k by 30. I did it by living at home until I was 25"
Well that's one approach, but not everyone has that luxury. You're lucky to have such a great head start, good luck, and don't piss it away!
Grim,
The so-called "paradox" of thrift, along with the reste of Keynesian pseudo-economics, is a bunch of nonsense that lovers of big govt. use to justify all sorts of state disruptions into the market (including central banking) that ultimately produce more harm than good, both economically, and socially.
Saving, and the accumulation of capital, is what permits increasing productivity, innovation, and a wide assortment of goods and services.
IMHO, it is absolutely stupid to think that squandering money you haven't earned on the "$300 jeans"
is good for economic activity, while saving $300, (say, for future health care needs when you get old) is bad.
Saving is nothing more than future consumption. To elevate present consumption as more important than future consumption gets the economic growth equation backwards.
The problems we face are not that people are NOW saving, but that they spent too damn much in the first place! Reduced spending now is payment for lavish spending yesterday.
Neither is more important than the other, they are opposite sides of the same coin.
Could a farm operate if all production was devoted to present consumption? What would the people do once their crop is done, with nothing left over to start another crop?
They either starve, move onto more plentiful lands, or hope other neighboring communities have produced a food surplus for them to share (or steal).
What happens for the person who spends $300 on jeans, BMW's, and expensive homes, but isn't prepared for an involuntary lay off from work (say due to injury), because they don't have savings?
He or she becomes a "victim", for which a host of govt. services are available. After all, we certainly don't want to see someone go without medical care, especially if they are likely to be productive if they get the assistance they need.
But, why is it "our" responsibility to provide medical care, when a person could just as easily prepare for that situation by "saving for a rainy day"?
All this emphasis on current consumption does is encourage irresponsibility, and discourage self-sufficiency. People no longer consider the fact that each choice they make means there consequences, and opportunities they must forfeit.
This brutal fact--that we can't have everything we want, convinces people someone is "oppressing" them, and only encourages the greedy politicians to continue to offer hand outs to whomever will get them elected.
What happens under a Keynesian system? Current spending (even if it requires increasing debt) is encouraged, regardless of merit.
People follow the motto: "Eat, drink, and be merry, for tommorw we die."
The inability to control current consumption, to moderate desires, is the biggest problem people in the U.S. face.
What happens if you have lots of debt? You worry. You worry about losing your job. You worry about paying your bills. You worry about getting sick.
You are in a constant state of anxiety. You are easily manipulated by those more powerful than you.
You take jobs you don't like just to pay your bills. You work longer hours than you want to keep the boss happy. You put up with all sorts of disrespect.
Political quacks who promise "quality healthcare" or "affordable housing", or "job security" via. govt. programs become persuasive.
Your fears about not being able to afford medical treatment, find a decent house, or find appropriate employment are allayed.
This is so despite the fact the govt. programs actually result in more expensive medical care, a shortage of affordable housing, and increased unemployment. Govt. programs always result the opposite of their stated goals.
The ultimate result--a growing govt. bureaucracy that takes from the productive (through ever growing taxes), and gives to those who do not take care of themselves.
You get--the State Govt. of NJ.
I remember the mid 90's when the rest of the family talked me into throwing away our perfectly fine B&W tv and buying a color one. Next thing you know the rabbit ears are no longer good enough and they want cable. Where does it end? How am I ever going to build up any savings this way?
I too see those people walking around in those fancy, expensive jeans, some of them drinking bottled water. Bottled water!! Who would have thought? What would Thoreau say?
Anyone catch Heebner on Bloomberg tonite? He's calling for a pretty hard landing with some markets seeing 50% declines in prices.
For those who don't know who Heebner is, he manages over a billion dollars in the CGM Realty Fund..
grim
ALot of animosity today on these blogs.
There will always be have and have nots. I know what you are going to say, most have not and live off credit, true...I totally agree.
But if someone wears $300 jeans (I happen to wear cavalli jeans myself), don't sweat it. Just think there is a 90% chance that son a bitch is in debt up to his eyes ball, or there is a 10% chance that is one rich son of a bitch....(also the is a .01% chance he may be mob too)...mobsters usually move in a 3 pack. So, if you see that with cavalli jeans, well....there is your .01%.
SAS
Rob Ryley, 10:31, a long post, but a great read!
Especially the long hours part, great stuff.
More information on Eric Schlosser's presentation at Ramampo College:
http://www.ramapo.edu/news/
pressreleases/2006/
08_08_2006c.html
Karen
"I have seen listing that were under contract and in a couple of weeks they are back on the market. Cannot get financing, or the properties are not appraising out."
Or the Greater Fools woke up just in time.
Rob Ryley said...
8/16/2006 10:31:51 PM
rye:
nice cynical manifesto
me likes :)
delford:
the rutherford house closed last week.
This is now the third listing for this house, each with a new MLS#, and a new price:
MLS 2310260
http://www.realtor.com/Prop/1066418949
From memory (don't have the MLS #s right now, but will later), the three listings were priced as follows:
#1: $1,100,000
#2: $950,000
#3: $924,000
Actual days on market for all these listings combined is over 200.
All three listings were Weichert.
Such deception is all part of the realtor "code of ethics."
> People follow the motto: "Eat, drink, and be merry, for tommorw we die."
Then again, "Tomorrow Never Comes"
I am the "$500k by 30 guy."
I was in technology consulting.
However, it's not the income. It's the habits.
1) I also lived at home for most of my 20s. Packed it away, hardcore. I got off from the seeing my increasing balance.
2) I always drove cars that cost ~ $2000. The last car I bot was $12k from a dealership, b/c it wasn't worth taking 2 days off to insure and register it....They did it..(I'd lose $2k)
3) Expensive cars and watches DO impress chicks, b/c it exudes confidence and power. confidence and power. confidence and power.
But, be smart, buy it used. YOu can buy a used BMW for the same price as a new Civic.
Buy a used Rolex, etc.
Me? I never buy expensive sunglasses or watches, b/c they ALWAYS get lost. And cars only scratch and dent. Who wants the stress? I'm driving my Accord 'till the bitter death. I hope to reach 200k.
4) CLOTHES: You're better off wearing cheap clothes that fit right, then ill-fitting brand names. And you're better off having 2 good suits vs. 10 shit ones. Dressing well does NOT have to break the bank.
And just basically watching your budget...
* I rarely eat out. Waste of time and money.
* Don't vacation unless you can afford it. Too many people classify vaca travel as a NECESSESITY vs. a LUXURY.
* Buy used. I've bot used golf clubs, guitars, sofas, cars, etc.
* Don't shop. I keep it minimal. I hate shopping. I hate clutter and chotchkies.
* Don't make stupid investments like plowing it all into dotcoms.
* Learn all the tax games. I save THOUSANDS a year with all my tax strategies.
Anon 10:31 (aka Mr/Ms $300 jeans),
I've lived in Jersey City since September 1989. Moved out here for graduate school from MI. Had only myself, my little car filled with everything I owned in the world and $200 to my name.
I immediately started temping to make money. I lived off of student loans and part time work while I went to school and actually managed to enjoy my life. Yes, I had very little money and I remember when I would go to the bar before they started to charge a cover and would only drink 1 beer (nursing it a veeeerrrrryy long time), since I didn't have money to spend on more than one. Anytime I ventured into the city I took PATH. I never drove because I didn't have much money and I didn't want to spend what little I had on the tunnels and the turnpikes.
In short, I was poor. But I had friends who loved me, I was working toward a career goal and I spent a lot of time exercising (sans gym) jogging and playing a lot of tennis. I look back fondly at those times because I did enjoy myself, depsite not having a lot of money.
You have to make your life satisfying yourself; you can't just buy lots of stuff, spending hoards of money and expect to be happy--it just doesn't work that way.
If you're inclined to feel diminished by what you think others are doing, buying clothes and trinkets aren't going to help that---there will always be others who make more and can spend more than you.
Live within your means and focus your attention on what's really important--your relationships with others and with yourself. And these have nothing to do with $300 jeans.
great post. Many forget that the "best years of their lives" coincide with when they were the poorest....high school, college, grad. school...
Clearly....marriage, kids, responsibility, adulthood, routines, suburbia, corporate ladders, mortgages, landscaping, Barney, Baby Einstien, Disney ..are all anathema to happiness...
I'm gonna go get plastered....and thank god I can pretend I am a college student in my 30s....for now...
!!
Hi Anon 11:36pm,
While the aspects of adulthood you mention (marriage, kids, responsibility, adulthood, routines, suburbia, corporate ladders, mortgages, etc.) do have a "daily grind" aspect to them, you are also making my point: most or all of them have to do with relationships with others, in this case your spouse and children.
To be sure, in adulthood, you also may not be able to afford $300 jeans, or fancy cars/vacations since you have these other responsibilities. But these responsibilities are what life is all about. At the end of the day, who are you coming home to and how do you feel being with them?
It's not about how many hat boxes (Zsa Zsa Gabor style!) you walked in the door with.
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