Judy Weil, SA Editor

58 Comments

    • Mortgages and Lending In The Subprime Meltdown [Housing Tracker] [view article]
      Dear Curbs-In,

      Sadly, this phenomenon isn't new. Barry Ritholtz pointed out months ago that Michigan houses were selling for a dollar, as did the NY Times back in May www.nytimes.com/2007/0....

      I suspect that there are many who would pay you to buy their house right now, if you could just get the millstone off their necks!

      The point is, these kinds of crazy asking prices have been around for awhile. The house mentioned in the Chicago Sun Times article is a foreclosed property, which means the rights to the property don't necessarily come with just $1.75. Back taxes, liens, fines for upkeep, etc. can reach in to the thousands.

      Michigan's macro environment is poor, and is likely to get poorer as the credit crunch hits automobile manufacturers even harder. Michigan's high homeownership rate is also clogging the market on its way down. See Mark Perry: seekingalpha.com/artic....
      High unemployment, poor job market prospects and mobility; the list is pretty long. I don't know much about Saginaw, but i haven't noticed anyone touting the solution to Michigan's problems recently.

      On the other hand, that may be the clearest contrarian signal that the market is in absolute despair, and so it's time to jump on those crazy offers.

      I'd like to say there's a bright side to this: Like maybe the market is actually moving up. After all, if back in May the headlines were about $1 houses, maybe prices have risen 75% and are now $1.75, indicating a positive trend??? Or maybe your half joke about putting in a $5 bid is an indication that, even in jest, buyers are looking for bargains and so may be moving back in to the markets.
      Somehow, I have the feeling that this isn't the case. But you have to trust your instincts!
      All the best,

      - Judy       Oct 05 05:30 AM
    • Why Are Homebuilders Up On Lousy Earnings? [Housing Tracker] [view article]
      Thanks! Oct 02 07:05 AM
    • Subprime Is Truly Global Now [Housing Tracker] [view article]
      Thanks H.O.!
      To 'Who'-- Got any tips on where I can find out more info on Hong Kong banks et al. I've found a little bit on the fallout from Lehman for Asian banks, but I'm not so familiar with Chinese sources and I suspect you are right about this being the tip of the iceberg for them.
      Thanks,
      Judy
       Oct 01 02:13 PM
    • Billion $ Question: What Will Mortgage Backed Securities Be Worth? [Housing Tracker] [view article]
      Thanks Bill,
      I haven't seen a $5T figure yet, but who knows where this will all end??
      Sometimes when I read some of this stuff, I can't believe the numbers being thrown around. $1T. It boggles the mind.

      What do you think about the bailout plan?       Oct 01 01:54 PM
    • Macro: How Bankrupt Financials Will Impact Connecticut, NJ [Housing Tracker] [view article]
      Hi Helpless Observer,
      Canadian financial blogger Larry MacDonald posted an interesting article on the same subject of refunding excessive bonuses: seekingalpha.com/artic...
      Interesting idea. Maybe its the start of a grass roots movement.
      What do you think of his idea?
      Best,
      Judy
       Sep 23 01:59 AM
    • Canada, NZ, Spain Home Prices Falter [Housing Tracker] [view article]
      Sleeping on the job...
      Thanks,
      Judy       Sep 17 07:12 AM
    • More On Mortgage Market Fallout [Housing Tracker] [view article]
      Hi Bill,
      So from the above it seems as if the crisis is going strong, but your comment yesterday gave me the feeling that there was some stabilization in the Nevada market. What's your overall sense there?       Sep 11 04:20 PM
    • Fannie, Freddie: Who Benefited, Who Lost [Housing Tracker] [view article]
      Oops, thanks for picking up on that. Removed it.
      - Judy       Sep 11 01:37 PM
    • Knowing When To Take Money Off The Table [view article]
      You're absolutely right. Thanks for reporting him. I've removed his comment as well. - Ed. Sep 09 11:08 AM
    • Financials: No Sign Of Let Up From Subprime [Housing Tracker] [view article]
      Yours is the question of the hour really. Homebuilders, financials, bloggers, buyers and sellers and even ratings agencies debate this issue vigorously and constantly. If people are bidding on condos even though they are not at rock bottom prices as you say, then is it the bottom?

      Obviously, I don't know the answer to that question. But here are just two things to think about in trying to.

      One is that many billions of dollars more worth of ARM mortgages and other exotica between subprime and prime mortgages are still in the process of resetting. I don't have the numbers in front of me, but I recently read that dozens of billions will be resetting in the next month and a half alone. Maybe with Fannie and Freddie's new look, banks will start lending, mortgages will now become more affordable and people can refinance in to a good, solid mortgage at a decent rate. After all, the Fed Funds Rate stands at 2%! People should be able to get a better deal than the 6-7%+ lenders are offering. But so far they can't and lenders won't lend even the sturdiest buyers for low rates right now. Risks are too high.

      Even if we're at the bottom, the market is still, well, at the bottom. Those that cannot afford the 10%-20%-even 40%-50% mortgage payment hikes, and cannot refinance or are not eligible to refinance, will not be able to sell. If they do, it will be without equity or even negative equity. Many will likely walk away. That's a lot of product coming on to the market. I won't even touch on the trend of rising prime mortgage delinquencies, the scenarios become even uglier.

      The other issue is why this whole thing started. Affordability. A bubble was created by prices just inflating and inflating and inflating until most people simply could not afford to buy anymore-- particularly in SoCal, as I'm sure you know.

      If sales are rising, is it because people can finally afford to buy houses now? Have prices reverted to the affordable mean already?

      [There's an actual measurement for that, by the way. Housing and Urban Development has an affordability metric, if I'm not mistaken. i.e. how much of their salaries can spend on housing and still live above the poverty line.]

      Obviously, I don't know the answer to that question either. But I personally believe that the answer to it will define the real bottom to this whole thing. If most people still can't afford to buy homes for a reasonable part of their salary, then the downturn will only stop when they can.

      Having said all that, I hope you're hopefulness turns out to be well-placed!

      ATB,
      Judy       Sep 08 04:22 PM
    • Commercial Real Estate: Eye On Hotels [Housing Tracker] [view article]
      Dear Politicus FInch,

      Sorry but the excerpt comes directly from an article on Commercial Property News' website. I googled it looking for independent corroboration and came up with another reference, but no dates. Looks like a beautiful hotel though...

      - Judy       Sep 03 12:57 PM
    • Commercial Real Estate: Eye On Hotels [Housing Tracker] [view article]
      John,

      Thanks for the tip about the comments. Leverage rates vs. cap rates were definitely out of control. Good point about REITs. Anyone know which ones are more exposed to the Arizona market?       Sep 03 12:53 PM
    • Homebuilder News: Lawsuits, Bottom Calls... [Housing Tracker] [view article]
      Thanks! Sep 01 12:53 PM
    • Home Price Declines, But Not Everywhere [Housing Tracker] [view article]
      Thanks Bill, both for your interesting analysis and for your ever kind words.

      - Judy       Aug 27 04:01 AM
    • Banks Wising Up? Short Sales Increase [Housing Tracker] [view article]
      Hi Fatcat,

      Sorry if it wasn't clear, I try to choose a title that reflects an important trend that emerges from the often disparate, general real estate news, but maybe I should be choosing more general titles.
      Something to think about-- thanks for the feedback.
      - Judy
       Aug 15 07:44 AM
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