patrick.net

I believe this belongs on the things that never happened and never would happen, continue to happen front.

from today's sfgate/chronicle front page

Analysis finds that many in the Bay Area, especially those who bought recently, owe more on their house than it is worth.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/04/15/BULE105CR4.DTL

northernvirginiarenter Says:
My secret Thai spot. Lunch entrees up from $6 avg to $8 avg.

Tell me about it - my secret Thai spot also went up from a $ 7.99 lunch in 2005 to $ 8.99 lunch last week. AND what is worse is that they stopped including free iced coffee (with refills), so that is actually about a $ 3.00 hike in actual terms of actual price.

(off topic) question for administrator:

Patrick

there's a blogger/reporter/ex green beret, who's reported from Iraq for years. I have tremendous respect for his bravery and integrity, as he's reported both bad and good news in the past (kept going out on missions when there were almost no other embeds left, he was first to report that there was a civil war in Iraq etc etc).

He has a book out which anyone planning to vote in 2008 should probably read. Do I have your permission to post a (promotional) link?

Last weekend, I caught one of the Shitty Realtwhore (tm) critters planting a sign on _my_ property, with an arrow pointing to some crap-shack that she was open-housing.

She saw me, and walked over to dump her mugshot-encrusted card on me. So I said screw that, and first "tell me what you think of this market?" She spouted some blather about 'location' and 'buyer opportunity' - and seemed to assume that I was a renter.

Tries to shove the stinking card at my face again - ignored.

"Wait a sec, you think it is a good time to buy?" She seemed to be going through some sort of internal struggle - probably her conscience and self-respect getting beaten up by hunger spasms and the thought of the upcoming lease payment on her Shitty Realtwhore Car (tm).

"Yes, interest rates are low and prices are stable - you have lots of inventory."

"So, should I wait some more time for things to get even better?"

"Oh things are great right now, you should get in before..."

"Before what, exactly?"

"Before prices go up."

"Thanks, I don't want you card."

She drove off, and a couple of minutes later I accidentally kicked over her open-house sign. I didn't know which way she had pointed it before, so I took a best guess - since it was a 4-way intersection, there is a 3-in-4 chance I got it wrong... oh well, c'est la fookin' vie.

SP,

I suppose you are asking people to walk away if they are upside down.

What I am arguing for is, there are people who are trying to game the system. Folks who can afford to pay their mortgage, but just want to walk away. I want these folks to pay their mortgage and eat their losses. I didn't argue about 3 year clause for people who are really distressed, it's fine for them to walk away. I hate the idea of speculators walking away.

I like how McCain singled out The Tan Man for approbation.

You know, having McCain for the GOP candidate this year may actually make sense. He's got enough clout with the center to actually beat O'Bama/Hillbilly with they way they are screwing things up.

Do you think McCain has the stuff to pick Ru Paul as his Veep?

Do you think McCain has the stuff to pick Ru Paul as his Veep?

I love Ron Paul, but a winning combination is more important.

How about Rice? :)

Rice got to where she is only because she is BOTH black and woman, or perhaps lesbian too, fills three quota in one, bravo.

Americans shouldn't really complain about inflation in this country. Yeah, grocery went up perhaps 20-40% in the last two years, restaurant food up 25% or so. But food accounts for a very small part of our monthly expenditure, so the 40% hike is translated into, say, $300, not nice but hardly breaking anyone's back. Second, there are countries out there with far worse inflation than us. Heard of 200%, 300% in a year or two?

We living in California are very blessed with the mild weather. People who need heating half time of the year are really screwed by their heating bill, which probably is a $500-1000 impact on their living cost. I would be very amused to see what kind of heating and cooling bill these 7000-sft McMansion owners will get this coming summer and winter.

But food accounts for a very small part of our monthly expenditure

Huh? Our food expenditure exceeds our housing expenditure.

Fowever, for now, many restaurants do not yet have the pricing power to raise prices significantly.

I would be very amused to see what kind of heating and cooling bill these 7000-sft McMansion owners will get this coming summer and winter.

If they have to wonder, they cannot afford 7000-sqft mansions. ;)

People who need heating half time of the year are really screwed by their heating bill, which probably is a $500-1000 impact on their living cost.

We need cooling though. Last weekend was very hot in the Bay Area. We had to turn on the AC.

If you build your house properly in BA, you don't need AC. I've been here for 15+ years, and the only summer that I went through feeling that I absolutely needed AC was the heat wave of 2 years ago when we reached 95F+ even at night. But it was only a couple of nights.

Other than that, I can hardly recall any time here that I need cooling at all.

We living in California are very blessed with the mild weather.

Did you ever live in San Francisco? To quote Mark Twain .....

Modern construction may (MAY) be far more energy efficient than older designs. My house here in Boise was built by Syringa, an "energy star certified" builder (for what that's worth). But my gas bill in January for a 2K square foot house doesn't exceed $110 which is by far the "worst case" month in winter (nights down to 15 degrees - brrr). That's not too much more than the gas portion of my PG&E bill for my old 1K square foot drafty house in San Jose.

Unfortunately my comfort zone is 45F - 70F. I must be a cold-blooded animal. :(

DennisN,

no, I have never lived in SF or experienced the coldest winter. I spent my entire tenure in the Bay Area in South Bay, which has a very pleasant temperature difference between day and night.

My PG&E gas bill in the winter is around $100, only for a couple of months (Dec and Jan), for a house close to 2K sft. Normally it's only around $50.

OO Says:
Rice got to where she is only because she is BOTH black and woman

I don't know if you're making a facetious topical reference, but having heard Dr. Rice speak on a couple of occasions at the Junior U., and knowing a couple of folks that have worked with her in the 90's, I don't think that statement is fair. She is a seriously capable and competent person, regardless of race- or gender-related "advantages".

This is not to say I agree with this administration's NSA or foreign policy, or that Bush has not appointed some world class clowns in other positions...

Thanks SP! :)

Somehow, intuitively I like Rice a lot.

SP,

I don't agree with your comment on Rice based on what I heard from people who worked with her at Stanford, and the public statement she made on lots of issues. Also, I consider it an oxymoron to be a "smart and competent" person who is loyal to Bush and considers Bush "intelligent" (in her words). But I don't want to linger on this topic, so let's just leave it at that.

I still don't see a problem with an employee being loyal to her boss.

An intelligent person will never imply that his boss is not intelligent.

Also, this is California, people like to bash Republicans for no reason at all. They rather condone extramarital affairs.

If you build your house properly in BA, you don’t need AC.
This is a good criterion for a superset of potentional Fortress properties. If you need AC, guess what, your property isn't in Fortress BA. Oh, and lets add "no AC needed" to Jimbo's list of what makes the Bay Area special. :-)
Speaking of AC, I came across a company, LSB Industries (LXU), that is part geothermal/water heat pump play crossed with a fertilizer/chemical manufacturer. I haven't done enough research to figure out if I want to invest, but they seem like they could be interesting given our discussions as of late.
Banks earnings have been just plain ugly; the gloves are coming off as they attempt to model behaviour for underwater buyers. Surprise, FICO doesn't matter (see CR for some good discussions). Feels like we are hitting the Alt-A wall and entering a new phase. Wells reports tomorrow; missed my short on them by a couple of pennies when they were above $33. :-( Must not be tempted (yet!) by the dividend.

This is a good criterion for a superset of potentional Fortress properties.

Palo Alto and even SF need AC.

If there were more than 5 days in the last 100 years with temperatures in the 80's, I need AC.

Peter,

Take a note. Don't ever think of moving to Phoenix.

OO,

Apologies as I'm not interested in baiting this topic either, but agreed on Rice.

I'd add that she has been completely ineffective, which boggles my mind as to why she is on the short list. My reading has led me to believe she has been a lame duck for nearly all of her governmental involvement, basically ignored at the cabinet level. It might not be fair to blame her entirely, but often to succeed at that level one needs some serious political acumen and instincts, not to mention leadership skills. I don't think she is in possession of these things, academic quals only carry one so far.

But if she can bring in the minority estrogen vote, since when did qualifications really matter around here?

EBGuy,

actually AC installed is a selling pt in the MLS ads :-)

I think a more immediate play would be companies manufacturing bullet-proof windows, home surveillance system (not just the alarm but also CCTV), car surveillance and anti-crime controls (not anti-theft, but anti-robbery), safe etc. I haven't found the right target, but the crime rate will go through the roof for sure.

OO said:
I consider it an oxymoron to be a “smart and competent” person who is loyal to Bush and considers Bush “intelligent”

That I can agree with :-) - although whether the loyalty is to W, or to some other self-interest is open to question. My esteem for Dr. Rice is actually diminished by her association with the Bush-Cheney Axis of Weevils.

CNBC poll yesterday.

In keeping with my sordid pessimism, this is really really ominous.

ONE in SEVEN mortgage holders are worried about making their payments within in the next 12 months.

OO Says:
If you build your house properly in BA, you don’t need AC.

Pfft... forget Bay Area, I have been in buildings in Harare and Nairobi that were designed for natural temperature control and did not need air-conditioning even in mid-day at the equator. It can be done, but it does not look like the bastardized Tuscan Garage-Mahals with Mission-style accents and Ionic columns that are so popular around these parts.

# northernvirginiarenter Says:
ONE in SEVEN mortgage holders are worried about making their payments within in the next 12 months.

That sounds _low_, actually. Just One in Seven mortgage-slaves?

The other six are all good, or are there a few Alfred E. Neuman's among them?

It can be done, but it does not look like the bastardized Tuscan Garage-Mahals with Mission-style accents and Ionic columns that are so popular around these parts.

Word.

You mean to describe 90% of new construction in Palo Alto, Los Altos or Los Altos Hills???

The alternative is the ubiquitous 3000sf+ McCraftsman on a 4000sf lot.

I hate Tuscan, Mission, or Mediterranean architectures.

Craftsman and Tudor homes are so cute. :)

I don't want McAnything. Architectural details are everything.

Bap33 rants:
listening to thump thump music so loud it is vibrating the windows of the store

Yesterday, on Lawrence Expwy, I was at a light next to one of these cro-magnon blokes whose car - some kind of eighties-vintage Pontiac sedan, with an exoskeleton composed of equal parts bondo, paint and scratches - had the 3 kilowatt audio WMD going....

...so loud that with each thump-a-whaka-thump, the windows and mirrors palsied to the extent where it was difficult to see through the rippling glass - and the excess air-pressure inside the car was expelled through the panels with a violent, rubbery-fart.

Does a car that sounds like a flatulent buffalo actually impress whatever female demographic that these buggers are trying to mate with? Has it occurred to them that their courtship may actually be improved if they actually spent the money/effort on buying/stealing a better class of automobile? Or is the intended audience for this display not a female, but instead similarly retarded examples of the male?

Sorry for straying off topic, but it isn't any worse than getting Steamed about Rice just because it isn't White. :-)

"F" for sentence structure.

The other six are all good....?
Let's see: you, me, OO, Jimbo, Malcolm, surfer-x

Sorry for straying off topic, but it isn’t any worse than getting Steamed about Rice just because it isn’t White.

Outstanding!!!

Some anecdotal evidence from Fort Collins, CO. Since April 1st, inventory appears to have climbed from about 2100 to 2350 homes, condos and land for sale. I think there might be some CRE mixed in, but that's relatively light.

If anyone recalls (not that I'd expect that), I predicted that condos and townhomes had been overbuilt thanks to the Fort Collins zoning laws that require a certain amount of high density housing in every development. In my personal favorite development, the Lodge at Miramont, I've watched a few 2bd/1ba condos with 1 car detatched garages go for $129K-139K. Circa 2003-2005 those were selling for into the $160K range and above. A significant amount of REO is pushing the comps lower. I suspect that many of these newer condos and townhomes were pushed to subprime borrowers by buildings using pocket brokers and ARMs. Some are just sitting on the market, I suspect so far underwater that they will eventually be foreclosed or never sold.

Nice homes are still selling in the $200-300K range, but only when the price is reasonable ($95-100/sqft seems to be a magic number) and the property quality is excellent. Anything overpriced is languishing on the market for months.

Up near CSU, there seems to be a definite dynamic of 100% cash buyers picking off the REO around campus whenever there's a bargain. You can tell when something is underpriced, and it always ends up in Backup about 2 days later.

Lots more listings advertising "short sale". As observed much earlier, the REO no longer gets listed with any keywords indicating bank owned property. Some of the builders are cutting lot costs, but since I don't want to get roped into their contracts, I've ignored those. Plus Fort Collins has an asinine rule where if the raw land is improved with water tap and power, your property tax moves into the 10%/year assessed value range. There are $130K estate lots in town with $3.5K/year in taxes.

To my great frustration, there seem to be quite a few folks in my cash-rich position looking in the same nice neighborhoods. It's sufficient that the really prime, correctly priced properties get snipered off the market in a week or two. But if you're outside those small zones... fuggedaboudit. You might as well be walking on the sun.

LOL @SP

Very entertaining stuff there. :-)

In honor of WaMu's $1.14 billion loss, here a are couple of the listings from the "it can't happen here file":
First, let's start off with this one: $929900 CUSTOM BUILT 3.5 STORY HOME IN THE BERKELEY HILLS. Was sold in 2006 for $1.6 million and a year later WaMu took it back for $1,066,217. Oh, and the Relitter isn't wasting his time (err... money), listing it on the MLS. A bargain all around.

There is also a newly constructed home at 1871 Tunnel Road that is owned by WaMu. Appears that the lien was for $750k, so they might come out even as it is offered at $815k. As the MLS listing says: Contemporary 3 bed 3 bath in Oakland/Berkeley Hills. Bank's Loss is your gain.

if the raw land is improved with water tap and power, your property tax moves into the 10%/year assessed value range. There are $130K estate lots in town with $3.5K/year in taxes.

When I was recently looking at house prices in C-Springs and Castle Rock, I noticed the tax rates on property with houses was much less than that. Does Ft Collins lower the rate once a house is built on the raw land?

Does Ft Collins lower the rate once a house is built on the raw land?

As completely ridiculous as that seems... yes.

Comparison of a 1/4 acre improved lot with a decent house in the same subdivision. The locations are Harbor Walk Estates and Warren Shores, respectively; both are around the perimeter of Warren lake and do not have lake access. You can find both properties on Colorado HomeFinder.

1106 Devon Way Fort Collins, CO 80525
$180,000 - Land
Subdivision: Harbor Walk Estates
Property Type: Land
Property Tax: $3,772
Tax Year: 2007
Lot Size: 11,520

3701 Gull Way Fort Collins, CO 80525
$325,000 - 2495 sf, 3 bed 3 bath, 1973 Single Family
Subdivision: Warren Shores
Property Type: Single Family
Property Tax: $2,377
Tax Year: 2007
Finished Square Feet: 2,495
Car Spaces: 2
Lot Size: 7,971