By maxoose03

November 21, 2006 05:06 PM | Link to this

Give a cigar to the man who said prices are going up as we speak.

The nonsense-mongers can carry on until early next year, when Realtor figures for 4th quarter 2006 come out. If they are compared to price peaks in late 2005, there may be a small percentage decline indicated in the single-family category. Regardless, this is a trailing indicator, and the trend may have even reversed by then.

House prices have stayed up despite declining numbers of sales, hurricanes, increasing taxes, soaring insurance premiums, rising interest rates, higher fuel costs, declining affordability, and an evil fool in the white house pursuing a costly and hopeless military adventure.

Meantime, for some good news, some leading indicators: Simon Property Group up 2.4% today alone; WCI Communities up 2.4% today alone; Lennar up 1.3% today alone; Fidelity Select Construction and Housing up nearly half a per cent today alone.

By Robyn

November 21, 2006 08:07 PM | Link to this

House ASKING prices are the only things up over 2005. House SOLD prices are down!!!!!

By maxmoose03

November 21, 2006 08:15 PM | Link to this

Robyn: How old are you?

By maxmoose03

November 21, 2006 08:15 PM | Link to this

Robyn: How old are you?

By anthony

November 21, 2006 09:08 PM | Link to this

Maxmoose,

Seriously. Housing stocks are going up because they have dropped 30 to 50 percent in 6 months. So, they are a good buy. As for south florida real estate, look at the indicators. Ask yourself why the number of students enrolled dropped from year to year. The bottom line is that prices will drop. They have already dropped ten percent nationwide. SOH, taxes, insurance are hurting the florida market and will continue to do so. Ask your self why builders like lennar are trying to get rid of their inventory by knocking 50% off their asking prices? Too many indicators to list……………..

By amstel

November 21, 2006 09:28 PM | Link to this

Maxmoose, Nothing you said is relevant. You’re just spouting the realtor party line. The housing market is toast.

Florida housing prices are tanking hard with no end in sight. This is just the beginning.

Nobody in their right mind mind should be buying real estate right now unless you are willing to get financially crushed.

By maxmoose03

November 21, 2006 11:10 PM | Link to this

The last two pathetic emails really weren’t worth answering, but what the heck, I’m here already.

Anthony — actually, an aggressive real estate fund like REPIX is up 50% since January 1st. You apparently know as much about the stock market as about the housing market.

But just for grins, let’s follow your fantasy a little and say that housing stocks dipped 50% in some 6 month period. Since arithmetic is apparently not your strong suit, I will point out that this means they had to rise 100% in a couple of months, just to get back to where they were. Now why do you suppose that is happening? Are all those little Harvard MBA’s running sector funds crazy?

And if, as you yourself assert, they are a good buy, why aren’t you buying any? More to the point, why weren’t you buying when they were off by 50%, as you claim?

Enrollment dropping in PBC schools? Let’s hope so. I am tired of paying for other people’s kids, and so are hundreds of thousands of retirees moving to Florida.

As far as Lennar goes, it is commmon for a builder to get rid of a couple of houses so he can wrap up and be done with a project. What Mr. Fishman’s relationship was with Lennar I can not say, but he clearly received unusual consideration. Lennar allows people like me to be cooperating brokers, and I assure you I am not aware of any houses being offered to a general audience at such deep discounts.

Lennar stock up 1.3% today alone, in a flat market. Yeah, they’re really dying ;-)

As far as the long-heralded housing crash, it just isn’t happening, so wake up and face reality.

Amstel didn’t even present an argument, so there is nothing to refute. Whatever he is drinking, I’m sure it’s not lite.

I certainly hope I do not get financially crushed, Amstel. That would leave me pretty much in your position.

By to max

November 21, 2006 11:33 PM | Link to this

max,

a few of us think you have a valuable insight, but you really blew it on the last one. selfish is what i call it. typical is what others will say.

you say you are tired of paying for other people’s kids via your tax dollars for public education.

bad post. bad citizen. bad neighbor. bad real estate agency, not so neighborly. some neighbor you are.

you do realize when your kids were school age, there were plenty of your neighbors who paid their property taxes so your kids could get a free and good education. if you decided to go the private route, that was your choice, but you had the choice.

now it is your turn to help pay for others as yours are grown and out on their own, assuming you had children. Thev problem is, you want to welch on the deal. You want to skip out on the check.

I will tell you this Max. When I am your age, I will not feel as you do as I see what an a*s others will look at you as.

If I were you, I would apologize or leave this blog. Your thoughts are not wanted and have been diminished in many of our eyes.

None of us like to pay taxes, but education is the fuuture of our country. Like public education or not, that is the deal you had many years ago, and just because you don’t like it, you want to take your marbles and go home.

You should be ashamed.

Good night.

By maxmoose03

November 22, 2006 01:35 AM | Link to this

“to Max:” Actually, one of the more interesting posts I’ve responded to — charming, in a juvenile way. Unfortunately, it is based on false premises.

First, let’s deal with the issue of how I am perceived. You did not have a conference with hundreds of other blog readers to determine how a significant number of others react to my remarks, so while your assertion was rhetorically useful, it was intellectually dishonest. However I will forgive this transgression so we may proceed directly to your naivete.

No, I have never had children, at least not yet. Yes, I have been paying for decades for the education of other people’s children, but this doesn’t especially bother me.

Like many in our country, I am fed up with Republican policies which have made the middle class pay for the rich, allowed corporations to pay nothing, and squandered our wealth as a nation - not to mention our young people’s blood - on a disasterous war which will even now threatens to make a super-power out of Iran. But even that isn’t the answer.

What you don’t know is I am idealistic enough, and concerned enough with young people having a future, that I actually tried teaching in the Palm Beach County School District.

Briefly, what I found was a Christian school thinly disguised as a public school, a system that stressed “accountability” to the total exclusion of teaching, and parents who wanted to make sure academic classes could be skipped in favor of softball practice, band practice, and anything else that might get their kids a college scholarship.

I found a community that was a partner in the corruption of its kids’ education. That school system, and that community, does not deserve to have one dime wasted on it by me or anyone else, until it cleans up its act and becomes an actual agency of learning. There are reasons why Florida ranks number 48 out of 50 states in the country in education, and I know those reasons first-hand.

Now: having the experience I do with kids, I am going to guess you are a young lady nearing graduation from high school. I am glad to see you are struggling to develop a civil conscience, but let me give you this adviced: before you act - before you speak - find out what the heck you are talking about.

Good luck.

By maxmoose03

November 22, 2006 01:50 AM | Link to this

BTW: Where is everybody? Who died and left this blog to me?

CW? Easy? Where are the prolific writers?

I am taking a break until some regulars show some interest in this topic.

Good luck to all.

By Albert

November 22, 2006 06:43 AM | Link to this

I saw this real estate ‘boom’befor in the late ‘80’s back up north and i was able to see the prices begining to exceed the ability of normal families to afford even small homes—the mantra then was ‘it does not matter what the prices are ’ because they just go higher—well suprise—when i saw the same thing happening again in03-04 i decided to sell my home in Port St Lucie and took the profitt and bought a home in /So Carolina twice as big with more land lower taxes and ins. i know 8 families that ether have moved out or are trying to do so -i miss Fla but the costs are just out of sight and getting worse-

By Gabriella

November 22, 2006 08:19 AM | Link to this

Albert, I agree with you but not the point we miss Florida. We sold our home in PBG and moved to Georgia - bought a home three times the size and three times as much land with 80 percent lower homeowner’s insurance, etc. The only thing I could kick myself about is that we didn’t move out of that God-forbidden land called Florida sooner. What’s to miss in Florida anyway? Flat land, scrub palms, humidity, hurricanes, rude people, no culture? Honestly, if we could get a house for free, we wouldn’t move back there but rather rent it out to some poor person who’s stuck living there. Sign me - glad to be out of swamp land, Florida.

By Rich R

November 22, 2006 08:27 AM | Link to this

I’ve been reading posts from Max and have come to my opinion.

This is a dangerous person. One who has no clue to the reality, but thinks they know all.

Max, you are confused and I have no idea what leading economic indicators you are using to justify your posts.

Time will tell as to the landing for SoFla RE, but since we’ve never before seen a housing boom with the crazy features of the one in SoFla (Insurance Madness, unfair taxation etc.), it’s almost impossible to predict what will occur.

Eveyone seems to think that the baby boomers, south americans etc. will come to SoFla and buy up all those homes on the market. We all have choices, and many potential buyers are choosing to buy elsewhere.

Ok, where are all of these people? Why do we not see better sales?

Simple, with every dollar increase in Insurance premium, that’s just one dollar that is not available for the debt servicing of the mortgage meaning the buyer qualifies for less of a house. When too many people fall prey to this, less people can buy, demand goes down, prices follow.

Working class is already priced out of the market, and many are struggling with the exotics they took just to get into the home and risk loosing it due to their inability to refi.

Just my opinion.

By crazydem

November 22, 2006 08:50 AM | Link to this

Where is everybody?Mike Fink is probably on the LA Times RE blog telling everybody their housing prices are inflated since only 2% of the homes are affordable to a family making the median income. Mike, please ask them what kind of rent they are paying out there. While you’re at it, please ask how long they spend driving to work each day, plus how much they pay in car insurance. Also, I’d be curious to find out how much some of those old timers in Venice Beach paid for their bungalos back in the day. Yeah, the ones worth a million or so now. They were the pioneers in that working class neighborhood-now they are sitting on a gold mine. Think there is a lesson to learn here???Finally, see if you can’t pick up some stock tips-I hear alot of the internet guys are starting green energy companies. Could be the next big thing, who knows???

Too many fallacies of logic going on here in the last week or so to comment on them-the usual gross overstatements with no empirical support being thrown around. I’ll leave it at that.

Anybody notice the County Commission f/u article this morning? They are reducing the number of affordable homes builders are required to build. I don’t feel sorry for the builders, but do feel sorry for the people working up toward something a few years ago who are now left out. Wonder if the CC knows something we don’t…? Maybe it’s that they really don’t need to force builders to build affordable housing as there is already affordable housing out there. I’ve said it once and I’ll say it again-anyone who says they can’t afford to live here needs to drive through Lake Worth just east of 95. Pretty? Not really. Quaint? Perhaps. Potential? A ton. As Brad Pitt said in Fight Club: “Did it ever dawn on you that maybe God doesn’t like you?” Truth is our first house oftentimes isn’t in the “nice” neighborhood with the faux fountain and retiree manning the gaurd gate. Sometimes it might be in the hood. (See Venice Beach pre-Morrison era.) There’s your affordable housing. Shame to say that apparently some people who don’t own a home are above living in such an area. Instead they rant and rave that the gated community they envision themselves in is overpriced and bound to drop by 50%-70%. The classic underaccumulator of wealth fallacy.

I will say this-that guy Jeff from the Post is earning his money-seems he’s the only one who puts articles together.

Big ups to everybody here-have a safe holiday. All you sideliners-do some reading over the holiday and edu-macate yourself.

By Rich R

November 22, 2006 09:03 AM | Link to this

It seems developers are getting even more desperate and creative.

Now there’s a group that will pay for your kids/grandkids college if you buy a townhouse.

That’s just crazy, but very creative.

This is the trickery that is altering the numbers on closed sales.

Don’t drop the price, just give Plasmas, SUV’s, now College Tuition. Take into account the incentives, you have even lower prices.

To the cheerleaders. WAKE UP!

Here’s the link for the article in today’s Sun Sentinel:

http://www.sun-sentinel.com/business/local/sfl-zincentives22nov22,0,5194987.story?coll=sfla-business-front

By Hey Albert

November 22, 2006 09:11 AM | Link to this

Easy,

It sounds like Albert here is what you call a HalfBacker.

Came from the northeast, went south to Florida, and then went half back to Mayberry.

Albert is right about the northeast in the late 80s. It did have a runup unitl 1987, but by 88, 89, the prices were starting to drop, so Albert missed his high. Jump ahead to today and even in this market, I can tell you the home my parents sold in Wilton CT in 1987 for $525,000 is now a home valued at probably $1.6 million, but the owners have since added on a bit. By 1993, prices were lower and flat, but in then end, did it really matter?

Albert sold out and went to Florida, and once again, by his own admission sold out in PSL and half backed up to the promise land, the Carolinas.

We have three families we knew who half backed up to NC, all 3, two are ready to come back, one cannot because of family reasons. The other two who want to come back cannot afford to buy again here because of the property taxes will be more than double if they come back. I agree that is something that is going to have to be fixed, but another topic.

NC will have to raise taxes. Infrastructure is stressed. They will need updated roads, more schools, etc. Those people heading to the promise land are only buying themselves a few years, then they’ll be screaming to move to WV or KY. The locals as we all know are not bringing over welcoming pies, they are dreading the Floridians as Oregon dreaded the Californians as Floridians dreaded the New Yorkers.

Nothing new here. History repeats itself. The cycle continues.

Florida is experience a cleansing so to speak. Lower educated, low net worth people are leaving, and higher educated, higher net worth people are coming in. Transformation has begun, and people don’t like change.

In the end, Florida will transform to big money, a power to be reckoned with.

By TANC

November 22, 2006 09:32 AM | Link to this

Here’s my two cents…

South Florida real estate values a year from now will generally be 10% lower than they are now as the market continues to adjust. I don’t believe it will go much lower than that. Going forward unit sales #’s will be steady at the current levels. It is not likely we will see a “boom” like we just saw again soon (unless we fall really far). This will feel bad for many in the industry (like me - a mortgage banker) as it is down 50% or more from the “peak”, but, it will be a strong level of sales on a historical basis. As the riff raff in the industry leaves because they can’t survive, those professionals left will continue to prosper. Patience is the name of the game now.

Demand will still be there albeit not at the levels we were accustomed to the last few years (how could it?). Florida is still a desirable place to live. The weather from now to March is unmatched in most parts of the country. Baby boomer demand will still exist for some time. Florida leads the nation in job growth. Insurance crisis will get worked out eventually I believe. SOH will be mostly a non issue for new buyers as real estate values flatten or go down some more.

If anyone had half a brain they would have known three years ago this slowdown was coming. It shouldn’t be a shock.

By Rich R

November 22, 2006 09:32 AM | Link to this

You have to be kidding me with this:

“Florida is experience a cleansing so to speak. Lower educated, low net worth people are leaving, and higher educated, higher net worth people are coming in.”

Florida has no industry other the tourisim and Citrus. All of which feed off of low-wage workers.

So, what you are saying is that the low-earners, less educated shall just have to leave SoFla and make room for the folks who are willing to pay the price for so-called “Paradise”.

That’s ignorant and arrogant to even think this way.

The working class is bailing out of SoFla at a very fast pace, as indicated by the lower school attendence (First time it went down since 1971)

As these families leave, there is nobody who can take their place due to high costs.

People who have been in their homes for extended periods, are fine, and even protected by SOH.

The SoFla economy will collapse if the lower-wage workers all left. No more Hotel workers, Resturant workers, Landscapers, Pool Cleaners, Life Guards and the list goes on.

What would happen is SoFla would be an even more horrible place. Think of retiring to SoFla and then have to mow your own lawn, clean or own pool and let’s not forget about the essential workers.

Who’s going to answer your 911 call? Teach your children? Mow your lawn.

If the Lower-wage workers leave SoFla, tourisum (biggest industry)just stops.

Just too funny.

By Me

November 22, 2006 09:38 AM | Link to this

Let no one give you lessions concerning rational argumentation who themselve engages in ad hominem.

By Housing Stocks?????

November 22, 2006 09:43 AM | Link to this

What does the price of housing stock have to do with the housing market in Palm Beach County?????

The one day price move of a builder’s stock pretty much tells us nothing about the housing market, much less Palm Beach County.

Most economists believe the housing market “nationally” will experience little price declines. However, these same economists believe there are pockets of over-valuation which will experience difficult times. They’ve pointed to Arizona, Nevada, and Florida as locations of those pockets.

Unless there was a publicly traded company that conducted ALL of its business in Palm Beach County, then there’s is almost no correlation that can be drawn from movements of builder’s stock price.

And inventory for single family homes continues to increase in Palm Beach County. With so many homes for sale, it is inevitable prices will decline some more (who knows how much more). Once the inventory of homes for sale falls back into a “normal” range (whatever that may be), only then can you say prices will stabilize. But having 2 years worth of homes for sale inventory is certainly not “normal”.

By cw1900

November 22, 2006 10:00 AM | Link to this

Ok, today’s paper….

http://www.palmbeachpost.com/pbcnorth/content/localnews/epaper/2006/11/22/s3bworkforce_1122.html

“County approves code change to require lower-priced homes”

If you read that article between the lines and from what we have been reading in the past few months on this same topic, the builders are saying they don’t want to be forced to build lower priced homes, the county is continuing to raise impact fees, etc, this leads to one inevitable thing no matter how hard the naysayers scream.

Costs to construct will continue to rise, supply will in time diminish, it always does, and base prices will be set on a higher plateau than before. The new benchmark, if you will. Much like the gas price new benchmark. Notice how we are all happy now at $2.25 /gallon because it is less than 3 bucks? Why are we happy? It used to be $1.65 not too long ago.

Fact is, we will never see $1.65 again, but I’ll bet the farm we’ll most certainly see $3.00.

Worldwide demand for gas is ever increasing. Nationwide demand for housing is always increasing. Our population is increasing, these are all simple fundamental facts that cannot be ignored.

Like it or not, a new plateau is setting for south Florida, NC, WI, TX, MA, WY, AK, NV, IN, MO, everywhere, everywhere, my friends, each and every state in this nation, and if some of you want to continue to close your eyes and say no no no, you will be doing your future a great disservice.

This cycle, history tells us, will not last forever, here or any other state. It may take a little longer, but make no mistake, it will happen. Plan accordinally.

More notes from CW:

• Please lord, let my wife take it easy on my wallet on Friday with all the other turkey’d up women fighting for that 98% off whatever it is, that Uncle Bob will just throw in the closet anyway.

• the post above by crazydem about your first house not being a palace, so right on the money I can’t say it loud enough. Our first house was what our friends called a dump in Lake Worth, but it was cheaper than rent, we fixed it up, stayed there 3 years, and since then we have rented it out for well over a decade. Planning and common sense and not doing what looks good to your broke friends gives you a $42,000 home all of these years later that is now worth $240,000, not a bad gig while other RENTERS paid my note each and every month. Thank you, Thank you, Thank you. That is only one example. The people who feel they must go right from the college dorm to the retiree at the gate is usually leasing their car and saving zero. It is an easy pattern to see and it is real, but man, they look good now.

• Maxmoose, you do seem like a good guy, but like it or not, it did sound a little bad about the taxes you dont want to pay to educate other people kids….you gave me a pass, I’ll give you one on that.

• To the kook trying to get easy to admit he is someone or someone else, not really sure, give it up. It’s played. It’s actually boring me. I think easy when he wants to, will intellectually give you an enema.

• On my way to the office, I put the heat on in the car for about 5 minutes.

• Happy Thanksgiving

cw

By Maxmoose is Right

November 22, 2006 10:55 AM | Link to this

Max is right about paying taxes for education. Most of the ones receiving these benefits are illegals from other countries who are using our “systems” for their benefit. My friend in California told me his taxes get higher and higher paying for all the illegals from Mexico in the school system too. People who paid their own tuition at private schools don’t want to pay the foreigners tuition either. Look at how many terroists and enemies were educatated in our own very schools in this country only to come back and attack us. It all boils down to who has money and who has not. If you have the money to educate your children in the private schools, that is the best gift you can ever give your children in life. But I understand how people are selfish and would rather spend the money on themselves than give their children a quality education. It is better to give than to receive.

Keep up the good work Max. I know your thinking and I have an appreciation for it. Many of the writers on this blog are ignorant to what a quality education is since they went through the public system. You know who they just by reading their thoughts.

By cw1900 humor

November 22, 2006 11:19 AM | Link to this

To the kook trying to get easy to admit he is someone or someone else, not really sure, give it up. It’s played. It’s actually boring me. I think easy when he wants to, will intellectually give you an enema.

cw1900 you are just too funny. That was the best line of the week. I should have used the restroom before I read your comment.

Happy Thanksgiving to all and bon appetit!

By back that up...

November 22, 2006 11:27 AM | Link to this

Above,

You say and I quote:

“Most of the ones receiving these benefits are illegals from other countries who are using our “systems” for their benefit.”

Referring to kids going to the public schools, you did say teh word MOST. Most, you educated person, means a majority, over 50%.

That is a lie. Back that up. What you are saying is, in this country, A MAJORITY OF EVERY KID IN THE U.S. GOING TO A PUBLIC SCHOOL is an illegal.

That is beyond not true in to the laughable. Pure population numbers instantly discredit that.

For a privately educated person such as yourself, you seem to know not so much.

You also imply only private schools can provide a quality education. Are you implying 100%, that means all, of the public school systems in the US are quality education?

Are you saying my upbringing in New Canaan, Connecticut, arguably one of the highest rated public school systems in this country, is not quality? You are very mistaken, sir.

Private schools, as public, must be chosed carefully. Some of the privates here in this area are not even close to the quality of an education you can receive in some public school systems in the US such as Iowa, Connecticut, Minnesota, and a few other very highly regarded public school systems.

Many of the teachers here teaching in private schools in this county were not qualified to teach in the public school system here, what does that suggest?

People cannot just spew out blanket statements like yours and expect to get away with half truths and lies.

Do some more research before you blow smoke like that.

Have a nice day.

By maxmoose03

November 22, 2006 11:33 AM | Link to this

CW, crazydem, TANC…!

That’s more like it. I really enjoyed waking up and reading your posts today, so thank you.

Brief notes: I get such a kick out of the goobers who move to Crapville in the South, and then write saying “We HATE Florida! We don’t miss ANYTHING about Florida!”

If you don’t miss anything about Florida what are you doing reading the Palm Beach Post and trying to make yourself heard to your old neighbors? One can almost see your misty eyes as you struggle with your orthography. It’s not how full of crap you are, folks — it’s how obvious you make it.

To all the folks who can not read: This newspaper reports prices are going UP, not down. Will you all stop saying “Prices will continue to drop…?” They’re not dropping! Naturally, you have to read the article to know that, because the editor, with his usual panache, does not choose a headline which says: “Sales prices not dropping.” Instead the headline is :”Sales down 49%!” This is yellow journalism at its most tendentious. In PBC, the Fourth Estate is not equipped to deal with Real Estate.

To the goober who doesn’t understand why I am reporting stock prices: it’s because other goobers are claiming the homebuilders are facing a crisis. If you owned the REPIX fund yesterday, you made 5% on your investment in one day.

Gotta go, get out of bed and have an attorney take me to lunch at Max’s Grill. It’s a tough life, but someone has to do it.

By Bosco

November 22, 2006 11:38 AM | Link to this

This is only the beginning and it’s very grim, hopeless in fact. Your only way out is to knock your house down and try to sell it as firewood and scrap, it’s your only hope of survival. It’s the end of the world, total collapse and utter choas and anarchy and mass starvation from here on out, sorry folks but the truth hurts. A $450,000 house on my block, can’t sell it now, he’s gone insane, labotomy and everything. He sold a newborn child just to keep up with the taxes and insurance. This is destroying families, we’re all going to die. Well, at least there’s still North Carolina, so some good news.

By typos

November 22, 2006 11:40 AM | Link to this

sorry. typos from above.

1. “chosed” replace with “chosen”

2. Are you implying 100%, that means all, of the public school systems in the US are quality education?

should be changed to:

Are you implying 100%, that means all, of the public school systems in the US are not a quality education?

I should proofread, but I’m working fast and I also went to a public school. I can’t be that smart. I need to tell my partner he works with an uneducated fool.

By How to Dismantle an Atomic Bomb...

November 22, 2006 11:56 AM | Link to this

the good ones….

cw - “turkey’d up women”

bosco - “sell it as firewood and scrap”

maxmoose03 - “It’s not how full of crap you are, folks — it’s how obvious you make it.”

back that up… - “That is beyond not true in to the laughable.”

Gabriella - nothing for you honey….your just bitter.

By to cw and easy

November 22, 2006 12:11 PM | Link to this

cw, you wrote,

“I think easy when he wants to, will intellectually give you an enema.”

you have to hand it to him on without a doubt the line of the year on this blog!

• hardly workin’ today but laughin’

have a good one to you and yours.

By Rich R

November 22, 2006 12:28 PM | Link to this

You all need to grow up.

It’s alright to disagree. When you blast someone for not agreeing with you, just makes you seem stupid and ingnorant.

Everyone has choices and everyone has their opinion.

Max, where are the values climbing in SoFla? Please tell me.

You must have gone to the Easyasabc school of cool.

Just too funny.

Simple economics folks. No magic, no wishful thinking, just basic facts.

The RE market went nuts over the past few years, fueled by greedy speculators that are now gone, with nobody to pick up the surplus of homes - Now at a 49 month supply.

Too many people upside down with huge HELOC balances and no way to handle the upcoming LIBOR adjustment and at the same time Insurance just keeps climbing.

Too much supply, not enough demand. Logic and basic economics suggests prices have and will continue to fall.

I just can’t beleive that there are so many people out there and don’t understand that this RE market frenzy of the past was stimulated with artificial sales (flippers) who are now stuck with their holdings and getting their butts kicked with the carrying costs. And rents that don’t even come close to covering the costs.

With taxes, insurance, maint., HOA fees etc combined with a market downturn that could last a couple of years before values start to rise again. You have to do the math and figure out how much it’s going to cost to carry a property and wait for the value to match what you have into it. Just shocking; do the math.

I would suggest that as time goes on, more and more of the speculators now holding, will be forced to sell to get out from the huge carrying costs. The more desperate these people get, the lower prices will fall.

If there was a turn around occuring, it would have been indicated in the most recent number; but it’s still deteriorating instead.

Oh what fun it is to pay more for taxes and insurance then for the principle and interest. NOT

Once again, just my OPINION.

By sober

November 22, 2006 12:30 PM | Link to this

Mxmoose03 please sober up from your all night bender. The median prices have been going DOWN as are the sales. If you are talking about stocks then please post on the stock blogs otherwise please keep your facts accurate. Thanks

By RichR SUCKS

November 22, 2006 12:48 PM | Link to this

You are such a Jack a*s Rich,

You think N.C. has such a big economic base. Think again it is mostly based on manufacturing. So if we have a huge downturn in Re in Florida and other parts of the nation NC will be hit pretty hard. And yes all the flippers are gone from FLA but guess what, they are now in your backyard flipping houses. I would not want to be buying in NC now it is about to get pretty ugly up there for you guys. Better hold on as you like to say. You jack a*s.

By Sonny

November 22, 2006 01:39 PM | Link to this

It seems there is a very easy way to “spark” the depressed Florida housing market and that’s Tax Portability. I find it strange that prior to the election the candidates were talking about this issue but since then, those words have not been spoken. If you make it easier for people to move from one house to another, more people will purchase and take up the slack in the housing market. It’s a logical solution and will result in more houses being sold. Why is the press not “pressing” government officials about its plan to put a Tax Portability plan in motion?

By TANC

November 22, 2006 01:51 PM | Link to this

The comment about NC’s economic base and the RE market is simply unsupportable.

One great attraction to NC and especially the Triangle area is the fact that job growth remains very strong and there is a greater diversity of jobs whereas Florida is so heavily Service Industry based. As far as housing is concerned, prices and sales activity remain strong but not insane like it was in SFL. If you check your facts you’ll see that in the face of declining sales and values in many if not most areas of the country, RE sales and prices in the Triangle Area continue to go up but ONLY at a rate of about 8%. THAT is sustainable as long as job growth continues (and it is) and demand remains firm (as it will - at least frm Floridians!). The problem with Flippers does not exist in that area. There isn’t enough return for the risk involved (at least right now).

Sure increased development can bring on problems in the future for NC and they must be careful about that but Florida is probably one of the worst examples of development getting out of control in the nation. But, for now, it appears NC is handling it better than FL ever has.

By TANC

November 22, 2006 01:57 PM | Link to this

The problem with Tax Portability is it does not necessarily solve the problem. Second Home and Investment Property owners will continue to shoulder larger amounts of the tax burden which will decrease demand and consequently sales on these properties. The result may be decreased tax revenues to the state.

How will they make that up?

Perhaps you could argue that increased sales from Homesteaded Properties due to portability might pick up the slack,but I doubt it will.

By Rich R

November 22, 2006 02:07 PM | Link to this

to the above post that called me a jack a**.

What in corn sake do you base your post on.

As sales and values plummet in SoFla, both sales and values are increasing here.

If you think that Raleigh/Triangle is based on Manufacturing, you need to do a little more research. You are very far off.

Biotech, Pharmaceutical, Medical research is done here, among other industry.

I grew up in SoFla and it didn’t take my MBA to see the bottom was about to fall out of SoFla’s RE market. I bailed in early ‘04, liquidating rental properties that I had for years, to reap great gains.

I chose Raleigh as the numbers here made sense. The average person, with the average job, can afford the average home here. Not true by far in SoFla. I am doing nothing more then riding the next wave. Perhaps you missed it and are holding property that you owe more on it then it’s worth. I have no idea, but I do think you are wrong, and there’s nothing wrong with that.

Very diverse economic base here, much unlike the Service Industry that is the backbone of the SoFla economic base as you chase the working class out with incredible cost of living. Then there is the “Quality of life” issue. People here are nice, also much different then SoFla.

I live thre for over 35 years; it was nice, not anymore.

Do your research, get your facts straight, and perhaps someone will pay attention.

By maxmoose03

November 22, 2006 02:43 PM | Link to this

Sorry I missed the debate on education. “Max is right” - thank you for recognizing there is a problem. The bottom line is Florida is ranked 48 or lower out of 50 state in public education - year after year after year. Having seen the system from the inside, I can believe this ranking is justified.

We need administrators who have better and more insightful solutions than more and more and more and more “accountability.” We need parents who are convinced of the value of pure academics in school, and who are not more interested in softball than Math, English or Science. We need to get rid of long-entrenched, incompetent teachers, rather than constantly look for justifications to pay them more. When these people retire, they are paid and cared for, for the rest of their lives. We should at least demand they do something before retiring.

To Rich R. and “sober” (an unlikely state of affairs): READ THIS: READ IT!!!!

NAHB says the Palm Beach County median home price rose slightly to $290,000 in the third quarter from $286,000 in the first (it includes condos and single-family homes, which aren’t combined in Realtor reports). And it says median family income remains at $64,400.

Know where that is from? It is from the introduction to this blog, which you didn’t bother to read, you morons.

If you don’t like the news as it is reported, argue with Jeff Ostrowski; argue with his sources; just don’t blame me for the news whne it conflicts with your dream world.

By Isabelle

November 22, 2006 02:43 PM | Link to this

The real estate market is not as bad as has been reported. Yes, prices are down from last year. But, last year was UNUSUAL. It was the peak of a 4-5 year boom. The fact that selling prices are down $50 - $100,000 over last year is really not that terrible!

I kept on saying to all who would listen that when we eliminated the “average Man” from the RE equation, we created a problem. The only good news is that as prices come down so will taxes.

And NO, I don’t want to move to “boondock” city in Georga or NC. That is unacceptable.

I still believe in the values here and they will come back just as strong as ever. This is a difficult time to get through, especially if (like myself) real estate sales have helped me survive these past 4 years. Now, I have to scramble - change partners and continue the dance.

By Rich R

November 22, 2006 03:25 PM | Link to this

That’s nice Max. Tell it to the folks who have had their homes listed for months with no activity at all.

I know quite a few.

You are dreaming and in fantacy land.

If you are correct, where are the buyers? Why so few sales? Let me have it.

You are fooling yourself, and that’s what got so many speculators in trouble. Fine by me, I really don’t care.

Sheer entertainment value for me.

By maxmoose03

November 22, 2006 04:32 PM | Link to this

Hey Rich R — Do you drive for NASCAR? I ask because I have never seen anyone with such an uncanny ability to switch gears.

You have been hounding people on this log day and night, about how prices are down 14%, they’re down 20%, they’ll soon be down 70%. As soon as I show you as news report that says prices are actually UP, you drop it completely and go on to something else.

So what do you want to talk about now? The number of sales is down from its abnormal fever pitch? We know that, Rich. I know that better than you, since I am an MLS Broker.

So what is your point?

Is it going to take most people longer to sell a house? Probably so. One problem we have is idiots running around making low-ball offers, because they have unrealistic expectations from people like you.

Is your problem really that you made a mistake in life, an educated person moving his family to Klan Country?

Do you now find you have priced yourself out of the market and can’t come back?

Are you angry because, your mighty MBA notwithstanding, you made no money on the housing boom? And didn’t even make money on construction or housing stocks?

Do you think it’s unfair? Do you think if you sabotage your former neighbors with mendacious propoganda, you can somehow reduce their prosperity, and thereby minimize the inequity you feel? Are you embarassed? Frustrated? Outraged?

If you love North Carolina so much, what are you doing spending day and night on a Palm Beach County blog?

I realize the biggest cultural events where you live are cross-burnings and gang-raping strippers. Still, isn’t there a newspaper in your town? Aren’t there people in your town smart enough to type into a PC? (Don’t answer that — I think we all know already).

As I said, Rich, it’s not how full of crap folks are, it’s how obvious they are about it.

If you love Mayberry so much, go relax in your easy chair and tune in NASCAR. Maybe you’ll doze off, and dream of golden beaches with turquoise water, of lissome girls wearing bikinis and smiles, of a sun which seems to smile down on you and say: “Welcome faithful Pilgrim; THIS is Paradise. THIS is your home.”

By Hey Rich

November 22, 2006 05:05 PM | Link to this

Rich, don’t let old Max get under your skin. He’s our resident imbecile here.

“Rich. I know that better than you, since I am an MLS Broker.”

LOL, that explains everything.

LOL,

By maxmoose03

November 22, 2006 05:41 PM | Link to this

That’s old Max, all right. Just an imbecile.

An imbecile with an IQ 3 z-scores (standard deviations) above the national mean, an advanced degree in a mathematical field, experience writing operating systems for IBM Corporation, college teaching experience, high school teaching experience, fluency in 3 languages, pro-level fluency on half a dozen musical instruments, licenses for real estate brokerage, mortgage brokerage, community association management, and invitations to attend law school at every school I applied to.

Yep, that’s stupid old Max.

SO - “Hey Rich:”

Rich R. is at least an educated person with an MBA. He does not need a zero, an ignoramus, a kindergarten drop-out like you to defend him.

Who’s laughing now, jerk?

I would hire you to pick up my dog’s droppings, but the dog is probably smarter than you.

Folks, be back when the low-lives have gotten it out of their system.

By Hey Moose

November 22, 2006 06:05 PM | Link to this

Wrong again. I have a Finance degree. And also you left out your resume the Nobel prize for economics, your honorary degrees from Oxford, Cambridge, Harvard, and Yale. A sad life you must lead. Endless paragraphs on real estate from an insecure psychopath makes for amusing entertainment. Keep up the good work Mr. Moose.

By maxmoose03

November 22, 2006 06:25 PM | Link to this

HEY GOOBER -

If you have a degree in finance, Rich R. is John Maynard Keynes. (Why don’t you tell people who that is, MR. Finance?) Your “degree in Finance” is probably an AA in Business Adminsitration from Palm Beach Comnmunity College - if it exists outside of your imagination.

Since I can write 10 paragraphs in the time it takes you to write one, it’s not much of a strain; and my life is almost too good to be true.

You have made it abundantly clear you are jealous of me, since you can have no other possible motivation for this discourse.

I understand.

You’re still a goober, though.

Why don’t you use this blog for something useful. Why don’t you use that “Finance” degree to explain Internal Rate of Return on a real estate purchase. Go ahead — it’s an open book question. :-)

By Mr. Moose is Very Mad

November 22, 2006 06:55 PM | Link to this

Mr. Moose, please reread ALL your posts. Would a normal person react and write the things you’ve written. I don’t think so. I’m just messing with you anyway. I won’t write another post here, this is getting out of hand.

By the way, I’m a bigger fan of Friedman.

Have a Happy Thanksgiving my friend.

By maxmoose03

November 22, 2006 07:46 PM | Link to this

Mr. Moose is not mad at all. In fact, Mr. Moose had a real fun time with his last post, and was hoping you or whatever goober would crack a book and take a swing at Internal Rate of Return.

That would have REALLY been fun. No such luck. Oh well.

Would a normal person write the things I write? Once again, you’re asking me to define statistical parameters. What is normal? In measures of intellectual capacity I’m clearly not normal because I far exceed the norm, by standards which were not developed by me, but only reported to me.

But that hardly interests me, and sounds arrogant to report.

Mr. Moose would guess you to be male, in your early 20’s, and I don’t think there is anyone who believes the author of any of the last couple of posts has a finance degree. In fact, I would say you are in a crappy office job that is really getting to you, and your frustration is starting to show.

You think you should be further along, you think you can do better.

Ah bon, nous allons voir. A la guere comme a la guere. :-)

My next post is already on the the new topic, where the news once again seems to have been written to agree with me. (Call me lucky.)

Happy Thanksgiving to EVERYBODY.

By michael

November 22, 2006 09:08 PM | Link to this

Buyers, before you buy find out waht’s really going on in the Florida market and around the country. Prices are falling and have a ways to go. Don’t buy now and catch a falling knife. Check out the Housing bubble blog. http://thehousingbubbleblog.com/

By michael

November 22, 2006 09:18 PM | Link to this

maxmoose, I challenge you to present your arguments at http://thehousingbubbleblog.com/

By michael

November 22, 2006 09:45 PM | Link to this

maxmoose, why don’t you try your RE and stock market theories on…The housing bubble blog(one word) preceeded as usual by www. and ending with .com

By Rich R

November 23, 2006 09:09 AM | Link to this

I have never posted that prices are rising in SoFla.

All of my references to prices increasing were within NC.

Max, you need to get real and have your med’s adjusted like Easy.

Have a Happy Thanksgiving.

I would expect nothing less from a starving Realtor.

You are just way too funny.

Thanks for the laugh.

You still haven’t told me were prices are climbing in SoFla.

By the michael is a little blogging queenie

November 23, 2006 11:06 AM | Link to this

michael,

you are a true blogging geek, hahahahaha!

that is funny, you say, ….”I challenge you to present your arguments at the thehousingbubbleblog.com

how gay is that? hahahah, what a freaking geek.

do you play well with others ar just get all huffy and point people to where you think you will make your argument, since you cannot talk for yourself. hahahahaha that is so gay.

i looked at the worthless site, just full of ads and google adsense ads hoping you morons will click on their ads so they will make money and you can wallow in your own little miserable misery hoping prices fall as I continue to make money slowly and carefully taking full advantage of bottom dwellers like you.

hahahahahahahahah

the housing blog is gay. you’re a blogging geek.

hahahahahahahah

By maxmoose03

November 23, 2006 03:12 PM | Link to this

Rich R: Starving realtor? LOL.

I set up the brokerage to be a conduit for my rehab projects, since, old hippie that I am, I like wroking with my hands.

I am not a money-oriented person, but Rich old buddy, I have to tell you — you are the worlds’s biggest fool if you try to compare your net worth with ANYONE who lives in downtown Boca Raton.

Ciao.

By michael

November 23, 2006 05:32 PM | Link to this

max says “old hippie that I am, I like wroking with my hands.” I bet you do max; just watch out it doesn’t slip off and hit you in the face!

By maxmoose03

November 23, 2006 06:30 PM | Link to this

Michael: What country are you from? Change that. What planet….?

Thanks, but I’m not interested in your website.

By da...da...da

November 23, 2006 11:26 PM | Link to this

What housing bubble ?????.

We have a souflee not a bubble ????

What we have is a leaking economic system drip…drip…drip…drip.. until the money is all gone or is worthless. We then can start buying and selling air we breath as an asset like we did with housing. So start buying up air rights now the crunch is coming before this RE market slump is over in the year 2012….

By MarkMax33

November 24, 2006 12:29 PM | Link to this

Max, If you are such a good economist prove it and try to refute any of these bullet points that show the housing market is toast. You might as well look for a new job.
1. Long term interest rates have been relatively stable lately. The question is how does that impact the housing market and the house YOU want to buy? It really does not affect the housing market because 80% of the loans in the last 4 years were Adjustable Rate Mortgages (ARMs). 60% of the loans in the last 4 years were Interest Only ARMs. What you need to evaluate is the short-term interest rates over the past 4 years. I’m not sure this link works:

http://www.bankrate.com/brm/graphs/graph_trend.asp?tf=1800&ct=Line&prods=325,360&gs=480,320&st=zz&c3d=False&web=brm&cc=1&prodtype=M

(short terms rates are up from 4% to nearly 6% - A MAJOR increase - play with a loan calculator)

http://www.mortgage-calc.com/mortgage/simple.php

I know you may ask, I am planning to use a fixed-loan product why does this matter to me?  It matters because if 80% of your neighbors used an ARM or refinanced with an ARM that their % rates will reset over the next 5 years.  For example if 80% of your neighbors bought and had a 4.8% ARM and the reset period for that loan is 1, 3, or 5 years, their current interest rate would be around 6%.  This is inevitably happening to ALL 80% of these people.  Their loan reset on a 500k home would take them from a mortgage payment of ~$2600/month to nearly $3000/month.  Realizing that most people bought with an ARM because they could not afford a 30-year fixed at the time an  ~20% increase in mortgage is going to put a lot of these people in trouble.  

Now on to the scary part.  60% (60% of your soon to be neighbors) of all of the loans in the past 4 years were Interest-Only ARMs.  These people got the loan based on paying no principle for 1, 3, 5 or 7 years.  Their mortgage payment is approximately ~ $1650/ month on a 500k loan and interest rate of 4.8%.  This term lasts for 1, 3, 5 or 7 years.  At the end of the introductory rate the person not only resets an interest rate from 4.8% to 6% BUT they have to pay the principle and it is amortized over a shorter period of time 29, 27, or 25 years typically.  The long and the short of this is that the mortgage payment for these people will jump to around $3400/month, an increase of OVER 100%.  I predict that at a minimum 50% of these people foreclose, which means 30% of the homes sold over the last 4 years will be foreclosed.  The graphs above show that it is IMPOSSIBLE for these people not to have a major increase in mortgage payment with an order of magnitude of 50-100% increase.  Remember that the MAJORITY of these people bought with an Interest Only loan or ARM because they could not afford the other loan to begin with.  How can they stomach a 100% increase?  They better get a big big big raise.  These people will not be able to refinance either because they do not have the income to qualify for a 30-year fixed loan!!!  Their mortgage payment is not locked!

Now imagine when all of these people start realizing they are screwed and put 0 money down to begin with.  They are going to file for bankruptcy and foreclose in waves.  It gets worse and worse as more neighbors foreclose because house values are dropping and will probably drop below the owed value of their loan to begin with.  It is basically an avalanche waiting to happen.  
Watch the skyrocketing foreclosure rates.  They are up over 100% from last year and trend will continue and increase exponentially.

www.dqnews.com has foreclosure rates BUT the site hasn’t been up for a few days. You can Google news “California foreclosure rates”.

"But wait, the Fed said they were going to stop raising interest rates and maybe even lower them...!!!"  Be very careful what you read.  It took almost 2 years for long term interest rates to START rising after the Fed started raising short term interest rates.  It is extremely difficult to say that they fed had much affect on these rates other than the fact you probably won't see a long term rate below a short term fed funds rate of 5.25%.  % rates are somewhat dependent on the Fed but MUCH MORE dependent on other things.  The short term interest rates rose as a direct cause of the increase of the fed funds rate.  The Feds #1 concern is inflation.  If inflation is not in check which is debatable at this point, they will NOT be cutting interest rates anytime soon.  Remember, rates are still NEAR all-time lows and cutting rates weakens and already weak dollar and RAISES inflation.  

The biggest question to ask is what happens to my loan after I purchase my home and what really controls interest rates?!  Few people understand this concept.  Mortgages get packaged together in lots of 100, 500 or 1000 and sold as a bond by Fanny Mae, Freddie Mac or the bank which originated the loan.  Who buys these loans you may ask?  The Chinese and Japanese purchase the majority of our homes loans because they are presumed to be VERY LOW RISK and keeping interest rates low helps keep the dollar strong and allows us to purchase more things from their country.  The Japanese sell us electronics and the Chinese sell us everything including the kitchen sink.  Imagine what happens if people begin to foreclose on their home loans?  The basic premise that our loans are LOW RISK no longer holds true and the Japanese and Chinese will not buy our mortgage backed securities or they will demand a higher interest rate because of the increase risk!  This is another part of the avalanche, if a few people start foreclosing interest rates tick upward which then triggers more people to foreclose and the cycle just multiplies.  Another likely scenario is that the old lending standards of 20% down and financial checks will ACTUALLY be enforced again which will kill everyone trying to refinance or buy/speculate.  Anyone with good credit and some cash is going to be sitting pretty.        

"Housing is coming down"  This is a very true statement.  If you look at the history of California real estate in particular it is extremely volatile.  It goes up a bunch it goes down a bunch.  The good thing is that the housing market is not a very "liquid asset".  This means houses can't be bought and sold over night or at the click of a mouse and that the transaction costs are HIGH ~6%.  The affect on the market is that it is much more momentum driven.  The turns are loooong as in years, the tops of cycles are looong as in years and the bottoms are looong as in years.  You will know you are at the bottom of a cycle when you see no change in the market for 1-2 years.  We dropped 8% last year and have a TON of crappy loans to deal with still, and everyone is priced out!  Housing will drop for the next 5 years at ~8-12% per year.   Condos will drop much more than houses.  

"They aren't making any more land"  They weren't making any more land in Japan when the real estate market went down 60% over 15 years (non-inflation adjusted)

"This is the best place to live, everyone wants to move here"  GREAT!!  Where is temperature on my mortgage application?  The only thing that plays into your ability to buy a home is your income and your ability to acquire credit.  Why were homes here the same ~price as everywhere else 5 years ago and for the prior 200 years?  What changed over night...absolutely nothing!  We just have a ton of speculators!!

PLEASE read this blog once a day:

http://thehousingbubbleblog.com/

Peer pressure - Everyone you know probably has made a ton of money in real estate and tells you it will never go down.  That's what I would say too if I had millions invested in something.  You know a market is overbought and due for a correction when the taxi cab driver, bathroom attendant, and McDonalds worker starts telling you about getting into real estate.  Follow the smart money and stay away while you can.  Warren Buffett the best investor in the world laughed at the southern California housing market and sold his house 2 years ago.  Follow the smart money!!

"The tax incentives are wonderful, I save soooo much money"  This is one of the biggest lies ever.  Few people really understand the tax incentives.  Lets do the math.

1 - You only receive a tax credit for the portion of the loan that you pay interest to someone else. This means if you are paying $25,000 per year and only $20,000 in interest you only can claim the $20,000 that you are giving away anyway. Additionally you do not get a 20k tax write off, you don’t get taxed on the 20k you are giving away to someone else. 2 - This means that if you are in the 37% tax bracket and pay 20k in interest that you get back 37% of the difference between your mortgage interest and the standard deduction = (20k - ~6500)*.37 = ~$5000 per year for paying 20k in interest to someone else!! 3 - Lets say you pay 40k per year in interest. You would get a write off of (40k - 6500)*.37 per year. Your net is about 12000 dollars per year of advantage for paying 40k in interest to someone else and having a 500,000 home loan. This tax write off decreases every year because you are paying less and less interest and the government increases your write off every year. Does that 12k really sounds like it is worth it in a decreasing home market? If your house drops 8% that year you already lose 40k . In fact that 40k drop probably covers rent pretty easily!!!

My plan is to save money like crazy and wait for the bottom and which point I won't need to take a large loan for the property AND I can refinance as rates drop.  Here is an old real estate adage, "Cash is King in a foreclose environment".  I would move to a place with cheaper rent and bankroll the money and buy CDs @ 5% or something like that.  It will pay off greatly in the end.  Just because the rest of the idiots jump off the bridge doesn't mean you have to follow them!  
Enough ranting.

By Rich R

November 27, 2006 03:12 PM | Link to this

I’d have to say, after living in Boca, my net worth is substantially higher then the average in Boca.

In my case, I’ll thank my family. I inherited most of my worth. Either way, I don’t finance anything. AT ALL.