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The Chart That Housing Bulls Don't Want You To See
It is hard to square the economic circle of homebuilder/REIT-related equities falling (given concerns about the higher-rate environment) with a broad equity market rally as much predicated on the re-blowing of a real-estate bubble as any other real fundamental basis. The conundrum is perhaps even greater when we note that in spite of an unprecedented surge in mortgage rates, pending home sales surged in the most recent data. However, as the following chart makes all too clear, home sales lag mortgage rates with a very high level of correlation and it appears, we suspect, that this most recent surge in home sales (extrapolated by those of that bias to mean that the housing recovery is sustainable even with higher rates already crushing affordability) is merely a pulling forward of activity and will lead to a significant softening in coming months (especially relative to expectations) should the taper-tantrum in bonds remain.
Charts: Bloomberg
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All depends on where you live. They are building like there is no tomorrow in my area. Zip 55902
Both track developments and ritzy 500k+ custom homes.
There's a major difference between building them and actually selling them to borrowers who can pay.
Here in Naples FL - most folks pay cash...just a sign of....
The Rich get richer, the middle class disappears and the rest serve the rich
My ex was from that area...
There's just way too much real estate for the rich to buy up. And the more they buy the more they'll have to face the menacing crowds.
I got to play landlord for a few months- not fun. Fortunately no crack-heads were involved.
And, will the "rich" really be able to maintain all these properties? Though labor is likely to continue to plunge, actual materials are likely to head back up (the reversing of economies of scale is going to really push on margins, in which case prices will have to stay aloft*).
* Eventually we'll all pretty much realize that we can't afford this fantasy-land lifestyle, at which time most of the stuff becomes worthless (yeah, sure, we'll manage to prop up sales through conning foreigners, but this will only be for a brief time, until the economies of their home countries start collapsing [watch what happens to China as they start clamping down on credit]).
Just a sec! If i hang myself before wednesday i will free myself of the dry cleaning bill due thursday!
Sometimes you guys give the fed/ bankstas and. gov more credit than their due ; like they have the joker trump card up their sleave.
Bottom line is the woodworm maggot rot infestation congregated above have used up all four jokers in the pack and it's a last order saloon, just steal customer funds, desperation.
Lights Out.
The hubris of it all. We thought that WE were dealing when it was always Mother Nature. Have I not warned about failure to question the premise?
When one tries to come up with a "solution" to all of this one can understand why many DO stuff their heads in the sand. Wasn't there a song with lyrics like "let's just get drunk and screw?" Sometimes I wish that I wasn't burdened by this sense of having to "do what's right."
We thought about buying this house earlier this year for more open land for our horses. It did need a new roof and the appliances were removed. The house was taken off the market, remodeled and repriced. The previoius owner walked away (while taking the horse stalls and fencing with her), so we're assuming the bank did the remodeling, but not sure. Other than the house, the property is just as it was in January.
Check the increase: January 29, 2013- $49,400......house then taken off the market in February.
June 6, 2013- $129,900....back on market
June 19, 2013- $119,900
A 163% increase. I'll bet it will stay on the market the rest of the year unless they drop another $30k even during this housing "recovery". They're living in a dream world; still a lot of abandoned homes in our area.
http://www.zillow.com/homedetails/7735-Ellis-Rd-Millington-MI-48746/2121...
We can only dream of such low prices here in Colorado. The same property east of Denver would probably go for at least $250k.
Let me tell you how this story ends: they spent $40k on fixing the roof and other retrofit and will get $80k for it for a loss of ~10k.
Wow, a manicured lawn! LOL! I've got a bunch of new fowl bonding to a coop on my lawn!
I struggle to make any connections between "financially savvy" and "horse owner." Sorry.
A while back someone in my area was selling a used horse trailer for $65k. My wife and I just shake our heads at the very notion of people having that kind of disposable income/cash. We refer to horses as "home-wreckers." See all sorts of properties where folks and their "I want a pony" spouses got drug under and had to sell. I don't view it as good, I can't, as it applies pressure to "economies of scale" for me when I go to buy stuff that all those other folks' volume purchases helped subsidize: used to be able to get straw for pretty cheap, but the guy closed down- he saw the writing on the wall.
Hop on Craigslist and check out Farm&Garden and you'll see all the signs of which I speak.
The only animals that I have that don't produce income are a dog (an LGD, which means it DOES earn its keep) and some guinea fowl (which are sentries and do tick and flea control).
Now then, if people have draft horses or ones used to actually do work, then That is a different story (but I do not find that there's enough of a market out there to warrant keeping/deploying such animals). And one day horses will certainly be valued for travel; but here again it's a bit early to be in that game. And, there's likely too much opposition from all the pony-lovers out there to allow it to be legal to eat horse meat.
My neighbor has 292 acres for sale. Been on the market for almost two years now. Not thinking that there's a whole lot of buyers out there. Not that I could even think of buying it, but I figure that maybe one day I could lease it- some folks (with lots of money) are already doing that, running cattle (which is what I'd do).
Good luck in 2014 dems
Look, you morons, the rising costs to buy a house looks like a hot market to potential homebuyers, so they want to get in, too, because their, now more expensive houses will go in value, making the buyers even more wealthy than they would have been had the price they paid been lower.
Ok, where is my Fed seat?
But the states, cities and communities in which retirees enjoy those tax breaks, tee times, affordable homes and other trappings of a comfortable retirement have not proven to be nearly as stable. With states and municipalities still reeling from the Great Recession, the security that retirees prize has become more and more elusive.
http://www.thefiscaltimes.com/Articles/2011/07/21/The-5-Worst-Places-to-...
Here's another sample from a well-written article by David Roth:
The Nation’s Biggest Housing Mess
Greater Phoenix, Arizona
There's no shortage of places in the U.S. with rotten housing markets. But Arizona deserves a special place on this list. It was dramatically overbuilt during the real-estate boom, and the massive inventory glut that followed cut the bottom out of home values across the state. In 2006, Arizona's median home value was $270,000; in 2010, it was $143,000. About 40 percent of mortgages in Phoenix, the state's biggest city, are underwater. Arizona State University real estate professor Jay Butler told Fox Business he doesn’t see the market turning around "for many years down the line." Even if you're not buying a retirement home, that's cause for pause.
Counties and municipalities still view property taxes as their unlimited ATM.
They keep raising the rates if the assessments stay the same. School districts keep asking for more and more money for the nice fat pensions.
People have to be constantly reminded they'll never own the property, even if the mortgage is paid off. They lease the property from the local municipalities.
Stop paying property taxes and see how fast they take your property away and auction it off.
"They keep raising the rates if the assessments stay the same."
So, if the assessments drop do the rates still stay up (and not increase)?
I recall people stating that assessments were going down and taxes were going up.
For me, for this year, both my assessed value and my property taxes went down by the same amount (roughly 13%): I've got Ag land, so the assessed value is already low to begin with (I'm no dummy). I chuckle at this after having a family member who was involved in real estate (commercial, though just on-the-side) tell me pre-bubble-pop that property values weren't going to go down. I exclaimed that they sure as heck were going to go down. Needless to say, I never did bother to explain my thesis for why I thought that property taxes would go down. I have been demonstrably correct on both counts; and the one relatives' property taxes have gone up (so, I suppose that in a way it would have been a tie?): to demonstrate that it's not a fluke for just me, another of my relatives' property taxes also went down (they live closer to me than the other relative).
Every once in a while my wife engages in a wager with me. She forgets that any time I wager I WIN. She's a very good sport: I never want her to just take my word; and, really, it's never "my" word anyway- I'm just a messenger for what IS (and will be).
So why is Ben destroying the housing recocery? Why?
Because he wants to be invited to a barbecue? He's a masochist?
Daniel Quinn put it best when he said that the "secret plan" is that we're going to continue to do what we've been doing, and for as long as we can. It's like children, they won't stop playing until someone gets hurt...
On the property tax issue. I don't own much, but have a vacant piece of ground that I got in a pissing match with the county over. They raised it more everytime I challenged them. So I read the tax code. All of it. I found 6 definitions of the word "taxpayer", all refered to commercial entities. So I wrote a letter, included all those definitions and their locations in the code, and told them I was not a taxpayer and questioned the legal a lawful authority to tax the land at all. They revauled my land to what I said, and paid my last years tax. If I did not have a teacher as a wife, I would not be paying any property taxes right now.