patrick.net

sorry different topic
has anyone noticed this
www.newhomesauctions.com
is ythis just to generate more foot traffic and interest?
the ownmers said that this is not a forteclosure auctions.
so is this the suckers auction to catch the fish that might take the bait now?
any comments on this.
specially interested in how the teal landing auctions go

Exactly Hello Kitty... just like it happened in 1991 prices dropped 40% in California along with interest rates. However you will buy much earlier than 20 years...your neighbors will continue to pay high prop tax for decades while yours will be half. In addition your mortgage will be half of the fools.

Mortgage meltdown causing Bay Area foreclosures to spike - breakdown by zip code.

Did you foreclose today?

http://tinyurl.com/2fxkcw

May I suggest a new thread..
Homeowners skrewed …

Bidding on new Manteca homes makes 34 new owners ecstatic
But low prices make current neighbors fume
By Julia Prodis Sulek
Mercury News
Article Launched: 10/13/2007 09:23:12 PM PDT

When homeowner Dave Cantrell walked into the hotel ballroom Saturday where Anderson Homes was auctioning off one-third of the brand-new houses in his Manteca subdivision, he tried to be optimistic.
He approached Anderson Homes executive Craig Barton, shook his hand and wished them both luck that the buyers would bid close to the latest asking prices of the 34 homes in the Paseo West subdivision that have been sitting empty since the real estate market soured.

But when the rapid-fire bidding was over 90 minutes later - and one winning bidder stood up like a prize fighter with his arms raised in triumph - Cantrell didn’t even want to look at Barton, the man he invited into his home two weeks ago to calm the fears of his 26 neighbors who worried the auction would tank the value of their homes.

“I’m feeling my worst fears right now,” said Cantrell, who estimated that the auction devalued his neighbors’ homes by roughly $200,000 each compared with what many of them paid a year ago. “I lost a quarter million dollars in value. I’m screwed.”

Cantrell bought his home a year ago for $670,000 (not including the $90,000 he paid to install a pool and miniature golf course). The winning bidder Saturday of an identical home five doors down the street paid $391,000 - 38 percent less than what he paid.

These houses are not in foreclosure. They are brand-new ones that Anderson Homes couldn’t sell no matter how many free upgrades it offered.

IS THE HOUSE STILL WORTH 391,000? JUST BECAUSE SOMEONE AT AUCTION COMES UP WITH TYHAT KIND OF MONEY?

When homeowner Dave Cantrell walked into the hotel ballroom Saturday where Anderson Homes was auctioning off one-third of the brand-new houses in his Manteca subdivision, he tried to be optimistic.
He approached Anderson Homes executive Craig Barton, shook his hand and wished them both luck that the buyers would bid close to the latest asking prices of the 34 homes in the Paseo West subdivision that have been sitting empty since the real estate market soured

AT LEAST DAVE CANTRELL HAS A HOUSE INSTEAD OF A PAPER PROMISE FROM DISNEY BANK. SO EVEN IF HE LOOSES A LITTLE BIT OF IMAGINARY VALUE IN HIS HEAD DONT FEEL SORRY FOR HIM BECAUSE HIS HOUSE WORTH WAS HIS OWN IMAGINATION OF COURSE SOLD BY THE MARKET FORCES.

Donald Trump say housing market is terrible.

http://www.cnn.com/video/#/video/politics/2007/09/25/interview.trump.blitzer.part.2.cnn

oo,

I read that article too. Antioch was always and will still remain really sketch. I remember back in the day constantly hearing about murders and drive-bys from out there.

I also wonder if the Chronicle meant it as irony to show that graphic of foreclosed homes using house symbols that look like monopoly pieces. Are they admitting all these subprime loans amounted to monopoly money?

Yet another SSOTW that makes me want to vomit.

SP,

Is that musical instrument store still there?

The food sucks there, but that Mongolian BBQ should be in your list of "original" restaurants. There's also Mumtaj when it was there, and Sue's - those were some of my first Indian meals. Then there's the old Wienerschnitzel...

Sellers getting screwed by listing agent-

http://tinyurl.com/2sqrwu

Since this has turned into a restaurant discussion anyway, does anyone have recommendations for places to eat around UCSD?

We used to go to Fleming's for steaks. I like the way they cook steaks. Crispy outside. Rare inside.

HelloKitty,

>Perhaps in a few years prices will crash, I can buy a house then in 20 years brag to >people about my low tax base with the classic:
>‘I couldnt afford to buy my own house today at these prices!’™

Maybe that is the best outcome I can hope fpr as well :-)

Skibum - Nope the musical instrument store is long gone, they have a brand-new shiney Scientology center now though! As a warning they're next to World Beads and any eye contact will result in immediately being hooked up to an e-meter.

skibum Says:
SP, Is that musical instrument store still there? The food sucks there, but that Mongolian BBQ should be in your list of “original” restaurants. There’s also Mumtaj when it was there, and Sue’s

There is still the old musical store, next to the sewing machine shop. I walked by it a couple of months ago - saw clarinets and violas in the window. The old chinese calligrapher store is also still hanging on, and Spangler's is still doing their bit of grim business. OTOH, both Mumtaj and Sue's are gone. There is a new Indian place where Sue's used to be, but I've never been there.

SP

OTOH, both Mumtaj and Sue’s are gone.

Man, I haven't been down there in too long! Plus, I hadn't paid attention to what restaurants were still there or not. Anyways, all the hipster wannabe's hang out in downtown Palo Alto, not MV.

OTOH, both Mumtaj and Sue’s are gone.

I think Sue's is still there... under another name.

Anyways, all the hipster wannabe’s hang out in downtown Palo Alto, not MV.

I speculate that the best restaurants attract the 40-45 crowd. What do you guys think?

Nope the musical instrument store is long gone, they have a brand-new shiney Scientology center now though!

Last I saw the musical store is still around in MV. the store is across the Scientology center ..actually old Macs musical store in Sunnyvale near Murphy even better is around exept its now under the Hieght Asbury Musical Store or something.

IS THE HOUSE STILL WORTH 391,000? JUST BECAUSE SOMEONE AT AUCTION COMES UP WITH TYHAT KIND OF MONEY?

Or in another words ... the house that sold for $640,000 earlier wasnt worth that much.

The market value is what someone wants to pay for it... without taking a stupid ARM loan...

hipster wannabe’s

we had Night Clubs come and go in the SouthBay.. eventually they all close down. The Limeligth on Castro didnt survive regarless of the so called Google money.

The orginal Saddlerack did well over the years...many decades longer than the hipster neon bars...
now that was a stonking great place... no hipsters allowed... no BMWs... no Gucci.... just my Wranglers my pick up truck and some cheap date who did put out with a shot of JD and two Coors. The good old days!!!
I will take SR over Santana Row any day...

Anyone read the article about the Sydney in Financial sense? It is well worth the very long read.

An example from Patrick:

Let's say you buy a house for $400,000, with a $350,000 mortgage.
Then the house drops in value to $300,000, you lose your job, or otherwise must move.
If you can't make your payments, the bank forecloses on you and nets $250,000 on the sale of your house at auction.
The bank's $100,000 loss on the mortgage is "forgiveness of debt" in the eyes of the IRS, and effectively becomes $100,000 of reportable income you must pay tax on. In many states, like California, the bank issues a 1099 to you for that amount and informs the IRS.

However, from http://realestate.msn.com/selling/Article_bankrate.aspx?cp-documentid=5427263

Home-sale exclusion still applies

The exclusion also applies in foreclosures. As long as the "seller," in this case the foreclosed-upon owner, lived in the home as his principal residence for two of the past five years, he can avoid taxes on any capital-gain profit, phantom or real.

It makes you wonder just who the Congress is worried about with the bill to not tax loan forgivenes as income. After all, so many "victims" who lived in their homes for two years are covered anyway.

To be honest, I think Kay Bell over at Bankrate is incorrect. I think once people try the "debt forgiveness as capital gain from real estate" tactic the IRS will slap them down. Just because Kay is saying it is so, doesn't make it so. Do we have any CPAs? Or Tax attorneys on this sight?

Guys,

Don't miss this video: interview with Mort Zuckerman on Housing. This interview came in the last hour.

http://video.msn.com/video.aspx?mkt=en-us&vid=fa5ecd48-83c5-4f82-a4e1-ee105c01274b

I feel sorry for 59% for those in denial.

Duke,

You may be right, especially for a short sale. But if a bank forcloses, isn't the transfer price listed as the amount of the loan remainder? Perhaps that would be looked at as the bank "buying" the house for the loan balance.

patrick's friend,

Thanks for the link. Sounds almost like Zuckerman has been reading housing bubble blogs! ;)

I pretty much agree with him save one minor point. His example of how homeowners and speculators should not be bailed out by the government is how when stock prices drop, the government doesn't just bail out investors. As we've seen recently with Fed policy, that's patently false. Wall Street always gets a bailout - the Greenspan put, and now the Bernanke put.

@Paul,

Funny what passes as "advice" on BankRate isn't it? At NO JUNCTURE did the seller indicate they were under ANY form of "financial duress" yet their "Ask The Expert" goes off about it?

Hey dude, IT'S THE RE FIRM listing his property that's going belly up, o.k?

"Home sale exclusion still applies"

Oh fer' cryin' out loud! Stop already! (See how the REIC works?) Even when they're losing, they're actually winning! How in God's creation can any right thinking person construe a debt NOT PAID as a "capital gain" and as such... yes, part of the all purpose, ever present and oh so flexible cap gains exemption?

Seriously, this has to stop.

@skibum,

Eh..... m-a-y-b-e. Still and all the primary beneficiary of cheap money has been the REIC. When the NASDAQ went from like 5,200 to.... triple digits I wasn't feelin' the love. That and there wasn't any talk about torturing the tax code to minimize... "the pain".

Some fascinating angst coming through on the 'middle class squeeze'. People are begining to notice just how much worse this generation has it compared to the previous generation. A few examples of note:
1. Pensions used to come with the job, free. They were not 401ks funded by our own earnings.
2. Health care was covered by the company. No payroll deductions and no copays.
3. Home prices were 3x income.
4. Energy costs were managable (gasoline, electricity, natural gas).
5. Food was managable.
6. College costs were within the reach of middle class savings.

Duke,

Long time posters here know my position on this. (Boy do they)

The workforce's needs have been largely ignored over the last 10 years due in large part to the fact so few of us planned on being part of it much longer.

I mean, between my ETrade acct. and my 401K "I'll" be retired by the time I'm....

So who cares!

I suppose I am bringing up the notion of how housing fits into an average budget in the broader context of all of the other pressures on the average budget. We may well see RE correct to more logical levels once the broader topic of the economy is broached.
For my part I see incredible asset valuations predicated on impossible corporate earnings given that people can no longer spend money on anything. To be sure, the American problem of deficit spending and massive oil imports harms the American consumer when compared to their foregn counterpart - who now ironically shop in New York for bargains instead of Europe. Which is my way of saying that maybe corporate earnings models can work using the consumer strength of other economies, but here in the US we are quicly losing our ability to do little more then buy less food (maybe that is not such a bad thing), get better but more expensive health care, give up on the notion of retirement, have our children send themselves to school on student loans, and spend our meager earnigins on housing and the commute.
No.
I think the American consumer is too important. I think corporations will have to expect margins to come down as salaries increase which means the stock valuations will have to come down on lower expected earnings. The stock markets loss should be the workers gain. We have simply tipped too far in favor of corporate profit over the needs of the middle class and some correction is very likely to happen.

People are begining to notice just how much worse this generation has it compared to the previous generation.

But we have iPods.

We have simply tipped too far in favor of corporate profit over the needs of the middle class and some correction is very likely to happen.

Pluto is entering Capricorn next year. The very reverse is going to happen. There will be even more corporate profiteering.

Please wait patiently for 2023.

"People are begining to notice just how much worse this generation has it compared to the previous generation."

I agree on this. It has gotten really ugly. No pensions, no retiree health benefits, extremely high health-care and education costs, as well as housing costs in many parts of the country, weakening dollar, etc.

It really doesn't look very good for most members of the post-boomer generations.

You need to be entrepreneurial and lucky, or you're in trouble. Many people in government jobs and academia are still ok, but it has become very hard in the private sector to make it in the long run based on a regular salaried job. Most private-sector salaried-job careers don't even last all that long these days.

I predict that there will be a serious crisis in this country in the future as a result of people being forced out of the workforce with many more years to live, but no benefits, not nearly enough savings, no way to help their kids, and not much of a safety net. Even people who are still in the workforce will simply not be doing as well as their parents/grandparents. We see the latter clearly now, and the picture will get much uglier when these new generations leave the workforce.

I'm convinced we're going in the wrong direction in this country - I can't see how things can possibly work out if the trends of the last two decades continue. Some sort of reversal will have to happen, or it will get pretty frightening. Unfortunately, many of our "thought leaders" in government and academia simply don't see this because they are not personally affected as much at this time.

O.K. Who are you and what have you done with Face Reality!?

Who are you and what have you done with Face Reality!?

He has finally faced reality.

"O.K. Who are you and what have you done with Face Reality!?"

Nothing - I'm the one-and-only Face Reality.

I'm not a believer in the Silicon Valley house-price crash that people have been predicting here for a number of years.

However, I've consistently said that the middle class is facing diminishing prospects in this country.

Well...alright...

It just strikes me that if you asked most people here; "what's the first thing you think of when I say... Face Reality?" you wouldn't get a lot of "Champion of the Middle Class!" type responses?

Or I could just be way, way wrong.

Yes FR is right, RE will crash everywhere but not the BayArea.

Even though I dont live there after reading this blog a few years I have a firm grasp on the subject.

Here is why no bay area crash:
1. Retiring boomers flocking to BA!
2. Continued immigration of homosexuals to live in Castro District.
3. Advances in HIV treatment means group #2 not dying out as previously thought.
4. No decent restaraunts (espcically sushi) anywhere else in nation/world.
5. BART system is excellent (not sure what that is...I'm from los angeles...down here we have buses for individual transit...everyone drives thier very own bus)
6. Rent control means no one ever moves.
7. Medical marijuana prescribed for common cold everywhere in SF.
8. If busted for prostitution you get let off w/warning (but parking fine=$400)

Anyone here a Southpark fan? The episode where Stans parents start driving a prius and move to SF is hilarious.

>>The Limeligth on Castro didnt survive regarless of the so called Google money.

Well their 18 and under night (yes... and under) really didn't endure them to the City....