Friday, February 29, 2008

Sgt. First Class Nicklaus Skaggs

Sgt. First Class Nicklaus Skaggs, 'Walker'
Mr. Skaggs isn't really inducted into the Hall of Shame, but his action speaks volumes about the Housing Bubble. I wouldn't say it was wise to buy a home at the price he paid, but he and many others are now getting wise. What did he say?...

........... Owning is Throwing Money Away!

2008-02-29: Borrowers Abandon Mortgages as Prices Drop
Other borrowers are walking away in frustration because they can't arrange a workout with their lenders, says D.J. Enga, director of outreach services for Auriton Solutions, which counsels homeowners nationwide. Mr. Enga expects that 10% to 15% of the roughly 4,000 callers counseled this month by Auriton, of St. Paul, Minn., will walk away from their mortgages.

Sgt. First Class Nicklaus Skaggs is among those looking to walk away. Mr. Skaggs bought his home in April 2005 shortly after returning to California from a one-year tour of duty in Baghdad.

The $455,000 three-bedroom home he and his wife purchased in Vacaville, about one hour northeast of San Francisco, is worth an estimated $285,000 today, well below the $453,000 he owes on his mortgage. The monthly mortgage payment, which jumped after its interest rate increased, is now $4,000, up from $2,980 when he bought the house.

Mr. Skaggs expects to be redeployed to Iraq again later this year. But he can't sell his home, since there are few buyers, and he can't refinance because lenders require a large down payment he doesn't have. Now, the 18-year Army veteran has decided to walk away from his mortgage. He hopes in a few years lenders see his decision as a unique situation created by the housing meltdown. "I don't think that house is going to recover in value any time soon," said the 40-year-old. "I'd just be throwing the money away.

Wednesday, February 27, 2008

Joe Lents

Joe Lents, House Owner Renter Buyer ... ?
I'm not sure what this guy is, besides a total SOB, in my opinion. This story bothered me from the moment I read it, but after reading Calculated Risk's summary and research associated with this character, he has truly earned a spot here. He has also been blogged about at and Exurbannation, among others. The Calculated Risk article is worth reading. Why does it seem that the majority of people speaking to the mainstream media, shouldn't be speaking to the MSM.

2008-02-26: Lost Home Note (from Calculated Risk)
Lents is former CEO of Investco Inc., a Boca Raton, Florida-based developer of voice recognition software. In 2002, the U.S. Securities and Exchange Commission sanctioned Lents and others for stock manipulation, according to the SEC Web site. He lost his job, was fined and his assets were frozen. That's the reason he couldn't pay his mortgage, he said.

2008-02-22: Deadbeat Homeowners
Feb. 22 (Bloomberg) -- Joe Lents hasn't made a payment on his $1.5 million mortgage since 2002.

"If you're going to take my house away from me, you better own the note,'' said Lents, 63, the former chief executive officer of a now-defunct voice recognition software company.

Tuesday, February 26, 2008

California Bubble Prices

I thought this was an interesting article. There's always a lot of debate about affordability, particularly in California. If you believe the plot (left), California clearly has a history of a higher median price for per capita income. But the recent bubble has taken the factor into ridiculous levels. At a minimum, it's not unreasonable to expect the data to return to 6x levels. If the economy goes into serious distress, who knows how low it could go. Time will tell.

2008-02-15: Homes in Bubble Regions Remain Wildly Overvalued

But the really bad news is that, even after a year of misery and falling prices, homes in many of these regions still aren't cheap. They remain wildly overvalued compared to average personal incomes.

There is a strong long-term correlation between the two figures. And in many regions, house prices would still have to fall a very long way to get back into line. Just to get down to seven times incomes, prices would have to fall 37% tomorrow.

How far? Try around a third in Florida and Arizona -- and closer to 40% in California.

Sunday, February 24, 2008

Yvonne Herrara

Yvonne Herrara, House ATM User
Ya' know what, Yvonne, you and your jackass family blew through $300,000 on home improvements, a pool, expenses for your kids, and who knows what else. You had your fun, now it's time to GET YOUR ASS OUT OF THAT HOUSE! IT'S NO LONGER YOURS!

What is America going to do once they need CASH to buy what they NEED, rather than house "equity" to obtain what they WANT! Truly sickening!

2008-02-24: Many local homeowners are hurting HELOCing
Yvonne Herrera's blue-gray, two-bedroom family home on a quiet, dead-end road in Covina was astonishingly cheap when she and her husband bought it: only $129,000.

Ten years later, after refinancing several times and borrowing money against the home, Herrera and her husband pay $3,300 a month on a $430,000 mortgage.

"We used some of the money for home improvements and to put in a pool," Herrera said. "But also a lot for expenses when our kids were in high school."

She said she expected to sell the house for below its value to her mother-in-law and pay rent to her for a year or two.
(Pardon me, but you fu**in' beeyatch, get the hell out of that house with your "plan".)

"It's the best solution we have because the bank won't work with us," said Herrera. "We put a lot of work into this house and it would break my heart to lose it." (Note to Yvonne: Unless you have household income of ~$130,000, there is nothing you or the bank can do.)

18820 E Laxford Rd, Covina, CA 91722-2004
3 beds, 2.0 baths, 1,122 sq ft
Sale History: 01/29/1998: $132,000

Lela Mazzeo

Lela Mazzeo, tiny-Trumps™
Let me guess... "We can do this!"
The average person should not speculate in real estate. To use it as a means to riches and early retirement is risky and foolish. Lela, you and your family did more than your fair share to inflate the Housing Bubble. I wonder if she is a graduate of Nouveau Riche University.

2008-02-21: Novice Foolish Landlords
The two-story house on a large lot in Casa de Oro -- on the less expensive side of the La Mesa border -- has been listed for sale for three months. The Mazzeos haven't lived in it since 2003, when they bought and moved into a home in Imperial Beach. They kept the Casa de Oro house, renting it at first to friends and then to long-term tenants. The last tenants moved out in December 2006, leaving the Mazzeos to 11 months and at least $75,000 of cleanup and renovating before they deemed it sellable.

But even when they had tenants, the rent the house garnered -- $2,000 to $2,100 -- fell far short of the nearly $4,000 the Mazzeos paid each month on its mortgage and upkeep. And since listing it for sale in November for $575,000, they've dropped the bottom of the asking price range to $499,000, less than they owe. They bought this house in 2001 and have accumulated four more properties, including the house in La Mesa where they live now. This home in Casa de Oro isn't appreciating the way it once did, the way they counted on it doing when they refinanced to buy other properties. And they can't get enough rent to sustain their payments in a down market.

Saturday, February 23, 2008

Nancy Corazzi

Nancy Corazzi, House ATM User
What is wrong with people? Since when did house appreciation become wealth before you've sold your home? It's as though HELOCs have become a way of life. Check out Nancy's gourmet kitchen. Don't get too attached to it, Nancy, you're on your way out of your HELOC-home. Perhaps if people would live within their means we wouldn't be in this mess. Yet another woman in the USA unwilling to settle for less. A phrase comes to mind: "We can do this."

I coined this phrase a while back:
Livin' high on the hog HELOC.

9534 Westwood Dr, Ellicott City, MD
5 beds, 3.0 baths, 2,578 sq ft
Sale History: 10/05/1998: $178,800
From other blogs:
Nov '01 - Refi $213,600
Apr '02 - HELOC unknown amount
Dec '04 -Refi $375,000
Oct '06 - Refi $381,000
Oct '07 - HELOC opened for $95K (spent $50k before it was pulled)

: Homeowners Losing Equity Lines
In one brief phone call, Nancy Corazzi's lender yanked away what was left of the $95,000 home equity line of credit that she and her husband took out five months ago.

"I got off the phone and I was shaking," said Corazzi, who was using the money to pay preschool tuition for her twins ."I was near tears. We needed this credit line to get us through some tough times." (How was she planning on paying it back??? So, paying expensive tuition for pre-school is tough times? WTF!!!)

Corazzi initially used her line to consolidate debt. She and her husband took out the credit line in October because they thought her job was in jeopardy. (Job in jeopardy, take on more debt. Huh?)

Meanwhile, they are trying to open a new home equity line elsewhere, but chances are slim given the change in Nancy Corazzi's job status and the drop in their home's value. Five months ago, the Elliot City house was appraised at $560,000; the lender says it is now worth $469,100.

"I told them, 'You guys are wrong,' " Nancy Corazzi said. "They said, 'Sorry, this is what we're doing in the entire area.' " (Tell 'em, Nancy: You guys are wrong! I need this credit to sustain my artificially high standard of living!)

Corazzi said she was blindsided by what's happened. "I didn't know they could do that. I thought I was too smart to have something like this happen to me." (If she was so smart, why didn't she see the Housing Bubble? Does she read Housing Panic or Dr. Housing Bubble? Not too smart if you don't.)

Friday, February 22, 2008


Federal Bureau of Investigation (F.B.I.)
The FBI just released most of America from there legal responsibility related to mortgage fraud. As long as your crime wasn't egregious, you'll be fine. Using your home to finance flat panel TVs, vacations, SUVs, etc, probably doesn't fall into the egregious category, so enjoy your loot you lazy, no good, sons-a-bitches.
2008-02-21: FBI Will Not Go After Borrowers Who Lied on Mortgage Applications
Borrowers who defrauded lenders by lying on their mortgage application could be thrown in prison for up to 30 years and forced to pay a $1 million fine under the current federal law. But the FBI says there is no intention to pursue borrowers at this time.

In 2006, the FBI studied three million mortgage loans and found that 30 to 70 percent of early payment defaults can be linked to misrepresentations in mortgage loan applications.

Although lying on a mortgage application is a federal crime, borrowers who committed mortgage fraud are low on the FBI's list of priorities. Joseph Schadler, an FBI spokesman, said investigators will be focusing on organized property flipping rings and bogus foreclosure rescue schemes instead of lying buyers.

'We're going to pick the ones that are the most egregious and have the greatest impact on the economy,' Schadler said. 'Fraud for property is less impactful on the economy than the speculative fraud where people are trying to flip homes for profit.'

Thursday, February 21, 2008

Lawrence Yun

Lawrence Yun, NAR Chief Economist
The Realtors trade group's senior economist, called the problems "temporary," and related to jumbo home loans above $417,000 ..(AP Business 9/5/07)"

Readers should always view any NAR forecast with caveat emptor contempt.

: Yun Commentary February 19, 2008
It is also fine for people to point the finger at me. In a fast changing market conditions, I too have been off on my forecast. I knew that the boom was clearly unsustainable and I made the forecast in early 2007 that home prices were likely to experience a price decline on a national level for the first time since the Great Depression. The national median home price indeed fell by 1.4%. I believe I downgraded my forecast for ten or so straight months in 2007 as it was strongly pointed out to me. At the same time, the Blue Chip consensus forecast, comprised of about top 50 private forecasters, including forecasts by Merrill Lynch, Goldman Sachs, UCLA, and the like — had also downgraded the housing forecast by more than 20 straight months. Forecasting is never perfect. Forecasts are bound to be off but the forecaster's job is to make the best prognosis given the available information at the time. The readers should always view any forecast with caveat emptor.

From Paper Economy:
4/30/2007 Lereah Leaves NAR
5/9/2007 Prediction: 6.29 million units. Yun "Housing activity this year will be somewhat lower than in earlier forecasts."
6/6/2007 Prediction: 6.18 million units. Yun "Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward with improving activity by the end of the year."
7/11/2007 Prediction: 6.11 million units. Yun "Home prices are expected to recover in 2008 with existing-home sales picking up late this year."
8/8/2007 Prediction: 6.04 million units. Yun “With the population growing, the demand for homes isn’t going away – it’s just being delayed.”
9/11/2007 Prediction: 5.92 million units. Yun “Patient buyers in most areas who do their homework will recognize that housing remains a good long-term investment.”
10/10/2007 Prediction: 5.78 million units. Yun "The speculative excesses have been removed from the market and home sales are returning to fundamentally healthy levels, while prices remain near record highs, reflecting favorable mortgage rates and positive job gains."
I think this guy consulted with Vivian way too much.
Lawrence Yun Watch

Tuesday, February 19, 2008

Joe Newton

Joe Newton, President, Placer County Association of Realtors
Oh, "Realtors say". Must be true then. BWAHAHAHA

2008-02-17: Local home prices beginning to stabilize,... Realtors say
The average sales prices of Auburn and Newcastle homes decreased from $502,510 last year to $476,493 this year, according to a January homes sales report from the Placer County Association of Realtors.

That figure means the market is beginning to balance, according to Joe Newton, president of the Placer County Association of Realtors.

Prices are starting to level out,” Newton said. “Houses are a little more affordable. Couple that with the lending side and interest rates being down makes it for a very good time to consider buying.”

Prices dropping, ergo, market is starting to level. Hmmm...
Houses are a little more affordable? From where the prices started, the drop is equivalent to getting a little more pregnant.
Lending side? Isn't it getting more difficult to actually get a loan.
Interest rates? Aren't they now rising.

Monday, February 18, 2008

Kim Canfield

Kim Canfield, Home ATM User
Here we go again! This broad and her jack-ass husband purchase a house that has been in their family since the 1920's, paying a mere $155K. Great. But what did they do next? Yep, you got it. Tap the home ATM, beeyatch. They refinanced 3 times for a total of $330,000! Why? Yep, you got it. Had to pay off credit card debt.

2008-02-17: Seeking protection
Kim and Robert Canfield filed for bankruptcy last summer to save their home from foreclosure. The Saugus couple makes about $5,500 a month after taxes. Their monthly mortgage payment had climbed above $3,000. The house has been in Robert's family since the 1920s, but they could no longer afford the payments.

The Canfields bought their home from a relative in 1996 for $155,000. For the next five years, they made regular payments on a conventional mortgage loan. Then, between 2001 and 2004, they refinanced three times, ultimately borrowing $330,000. They used much of the money to repay thousands of dollars in credit card debts.

"I guess I'm just stubborn," Kim said. "I want to keep my house."
(It's not your house, anymore, idiot.)
................................... $330,000 ...............................

Sunday, February 17, 2008

John Bailey

John Bailey, Home ATM User
I still don't know why people want to air their dirty laundry to the MSM. Here is 74 year-old, Mr. Bailey, tapping the home ATM 4 times--the fifth time didn't work. Are we supposed to feel sorry for him? Was he planning to sell the home after extracting all the equity? Or was the plan always to walk away? And why did the lenders loan an old geezer the money? Two words... Housing Bubble.

Here's another thought. Rather than sell your home, extracting equity is a hedge against selling it at a lower price, because once you've sold it, the house is gone. If you continually pull equity out of the house, you're maximizing the pay-off without "losing" the house. Later, when you can no longer extract equity and you have absolutely no ability to pay back the loan, you walk away. He "sold" his home at the peak.

BTW, somebody explain to the Moises, also "owners" in Ventura, that they are under water. Their story is the classic 'Suzanne' situation. (Video Quote: "There is no time for us to have space." WTF! They cut back on eating out, but I think they should cut back on eating... period.)
2007-12-16: Families finding struggle to stay in pricey state as economy softens

Home information:
820 Vista Arriago, Camarillo, CA 93012
2 beds, 2.5 baths, 1,407 sq ft
Sale History:
01/11/2008: $513,155
11/29/2005: $287,500
12/21/2001: $287,500
07/03/1997: $179,000

2008-02-17: Declining values, defaults, foreclosures catch many local residents by surprise
"I never thought this would happen to me," Bailey said last month as he looked at the stack of paper that told the story of how he lost his home.The 74 year-old, who wears his red plaid shirt buttoned to the neck, is one of the 1,500 Ventura County homeowners whom lenders foreclosed on last year as the housing market crumbled under the weight of failing subprime loans.

He and his wife, from whom he is now separated, had refinanced their Camarillo Springs home four times over six years as its value steadily climbed.

But when they tried to take out money again in early 2007, they discovered that the value of their home had plummeted.

Saturday, February 16, 2008

Mike Powell

Mike Powell; Realtor, Cypress Realty GMAC
Like a junkie that no longer has access to his drug, this Realtor has gotta have his 'credit fix'. In protest, he's calling for a boycott of Countrywide. Yes, boycott the only responsible action that Countywide has undertaken during this bubble. And how financially responsible is Mike? Not very. Read on...

2008-02-16: Real estate agent boycotts housing lender
A Fort Myers-based real estate agent is calling on his colleagues to stop doing business with Countrywide Home Loans, saying the company is cutting off home equity credit to solid residents of Lee County because of falling housing prices.

"I have used Countrywide as a borrower and real estate agent for 15 to 20 years and they have decided that the relationship means nothing," he said in an e-mail to The News-Press and other agents. He said he's speaking as an individual, not on behalf of Cypress Realty.

"I'm asking fellow agents to not use them, or the public for that matter," Powell said in an interview. "I look at it as I pay my bills all the time, I have excellent credit, I've given them business for years. Just because they say Lee County is in a really declining market for values, they're just going to cut you off."

He found out the hard way when Countrywide shut down two lines of home equity credit he'd paid off last year with $56,000 in savings, Powell said.

Powell made the decision to pay off the lines "knowing I would probably have to borrow some of the money back in April to pay taxes," he said in the e-mail.

Now he'll have to withdraw money from a retirement account and take a 10 percent penalty or use a credit card with a high interest rate, Powell said.
Mike, please watch this video on credit: Don't buy stuff you cannot afford

Walmart Cake for Suzanne

A 'Suzanne the Realtor' going away cake made at Walmart!

Think about the conversation (or note) that established the inscription. Sorry, I couldn't resist.

Friday, February 15, 2008

John Karevoll

John Karevoll, DataQuick Analyst
How many people can realistically afford Jumbo financing? How many are truly able to manage $417,000 worth of debt? $417K/3 = $139,000. Show of hands the number of households that earn this amount...

The latest from Karevoll the Quack...
2008-02-13: SoCal's housing-sales woes mirror San Diego's
John Karevoll, said sales were so slow, even for a January, that no clear trends could be drawn from the numbers. “There's an incredible amount of turbulence,” he said.

“San Diego just appears to be a little further along the line than the rest of Southern California and is probably in line to scrape bottom and emerge faster than the rest of the region, also,” Karevoll said.

2008-04-16: Median price keeps falling (hat tip zk)
Longtime DataQuick analyst John Karevoll said he has picked up early signs of a possible bottoming out of the housing downturn in southern Riverside County, where many San Diego workers live. Karevoll also said he thinks there is pent-up demand from would-be buyers who have been largely shut out of the market since last summer.

He predicted that San Diego's overall median may slip another $45,000 and bottom out at around $350,000.

If that happens between now and summer, I think there is also an equal chance that the median could go back over $500,000 by the end of the year,” he said. “That's how crazy it is out there.”

2002-08-27: Local housing costs drain family budgets
"People tend to get sticker shock when they look at prices," Karevoll said. "But the rubber meets the road at the end of the month when they have to write a check to the bank. I think it illustrates just how stable the market is instead of how distressed it is."
2006-02-12: Mortgage default notices are on the upswing
“If you're in economic trouble, you don't let the house you live in go into foreclosure,” he said. “You'd avoid it.”

2006-08-20: San Diego price drop was unique in region
Karevoll said San Diego seems “stuck in neutral,” where prices are likely to “wobble” between positive and negative changes, compared to levels a year ago. But he said San Diego's natural attraction to outsiders seeking homes remains strong.

2006-09-21: DataQuick Analyst John Karevoll
Projections from a "housing data specialist"

Despite recent declines in Southern California home sales and appreciation values, there is little statistical evidence supporting recent gloomy reports that the housing markets are in for a serious downturn, Karevoll said.

“We’re not seeing ominous signs; no where to the degree that there were ominous things happening back in the late 1980s and early 1990s,” Karevoll said. Notices of default – the first step in the foreclosure process – remain low in the region, and there has been little activity where sellers carry back second mortgages to help buyers, he said. But otherwise, (price appreciation) likely will stay flat,” he said.

2007-04-15: Borrowers are caught in backlash over loan defaults
Foreclosures here tripled over that period, according to DataQuick Information Systems. Even so, defaults still represent a small fraction of the market. DataQuick analyst John Karevoll says there is no cause for alarm.
2007-04-15: Region in Review
“Most of San Diego's declines, if not all, are behind us,” DataQuick analyst John Karevoll said.

2007-07-17: Housing prices in county hold their ground
“The big issue here is that with the slowdown, you would have expected prices to come down much more than they have, and it's very likely now that most of the decline off the peak for San Diego has already occurred,” he said.

2007-07-25: County foreclosures leap higher
Although foreclosures are spiking, there is no reason for homeowners to panic, Karevoll said.
“California is better off than the nation, and San Diego County is better off than California,” he said.

2007-08-14: San Diego new-home sales hit lowest point in five years
“Most of the declines in San Diego have happened,” Karevoll said. “Now it appears to be re-establishing a balance that we have yet to see for the (Southern California) region.”

2007-09-13: Housing decline continues
“San Diego is actually doing far better than the rest of the region, especially if you look at the Inland Empire.”

2007-12-24: Mortgage relief mired in red tape
Karevoll expects defaults to “snap back up” in the year ahead. [White-wash it]

2008-01-14: County housing prices down 13.1% from year ago
“We can't say home values have declined 13.1 percent,” Karevoll said. “The numbers are probably more reflective of the types of homes that are selling and the types of loans available for those buying. There's an awful lot of people buying homes who need jumbo financing and are waiting it out.”
This comment at Ben's Blog said it best:
“‘There’s an awful lot of people [not] buying homes who [cannot afford them and therefore] need jumbo financing [which they cannot obtain] and are [either wisely or fortuitously] waiting it out.’”

Wednesday, February 13, 2008

Purva Brown, Delusional Agent

Purva Brown, Delusional RealtorAgent®
Has the market turned yet? (Sep '07)

She just won't give up. What she fails to understand is that without a 'median income population' to purchase homes, there wouldn't be many homes bought and sold. This is why prices are coming down, and we still have a long way to go.

2008-04-21: Investors are here!
I personally believe if you haven't bought a house yet, you've missed the bottom of the market.

2008-04-04: Market Statistics
Good news, everyone. We have bounced off the bottom, even if it be ever so slightly. Here are the details on Sacramento county's real estate market recovery in March, 2008.

So... median prices have steadied, inventory is down and sales are up! The
Sacramento real estate market recovery has begun.

Hurray!!! Thank you, Purva!!! I'm putting all my money in RE now... NOT. LOL

2008-02-15: Does Median Income Have Anything to do with Median Home Values?
Okay, I'm really sick and tired of this argument. You know how it goes: "Median income has not kept up with median home values in Sacramento, this home prices must fall until everyone in Sacramento can afford to pay a third of their monthly budget toward their mortgage." It's a seemingly innocent calculation and very easy to remember; so simple in fact that it gets quoted again and again and unfortunately believed.

But here is an article from the SF Chronicle:
2008-02-14: California home prices still unaffordable
The authors of "Locked Out 2008: The Housing Boom and Beyond," the study released today by the California Budget Project of Sacramento, said median incomes aren't enough to buy median-priced homes in every county it studied, 36 of the state's 58. The report assumes homes are out of reach if households have to dedicate more than 30 percent of their income to housing costs, the level above which the U.S. Department of Housing and Urban Development says people may have difficulty affording necessities such as food, clothing and transportation.

The latest from our Delusional Realtor is a complete 'about face' on affordability. But, gee, if people used the 'third of gross income rule' for payments, who could have purchased a house in Sacramento over the past few years? Maybe during the bubble the rule was 'third of gross liar loan income'. She is basically contradicting her previous point that median income has nothing to do with median house price. (Ref: Ignorant Realtor of the Week)

Where are the median condo prices now, Purva?
Sep '07: $250K
Feb '08: $143K
Jun '08: $135K
Aug '08: $125K
Oct '08: $110K

How's that for an o-r-p-l-e.

Or this gem...
Or how do you explain San Diego where the median price of a home is $566,700 and the median income is $55,637?

It's called a b-u-b-b-l-e. Where are San Diego median prices today? $451,500, and falling.
Jun '08: $370,000 Ain't reality a bitch, sometimes.
Sep '08:
$328,000 It's like a nightmare,...
Oct '08:
$323,500 it just keeps getting worse.
Nov '08:
$305,000 Nov '07 was $521K, Down 32%!!!
Dec '08: $300,000 Light at the end of the tunnel?...
Jan '09: $280,000 Doubtful! LOL

Feb '09: $285,000 Head-fake?
Mar '09:

BTW, where were the "experts" during the growing bubble?
2008-02-11: 5 Ways to Know How much House you can Buy
1. Calculate how much you are paying for rent. Then take a good look at your monthly budget and figure out if you can afford taxes, insurance and home repairs. Right now, there are probably homes in your neighborhood you could buy for not much more than the rent you are paying.
2. Most financial experts top off the money you should pay on your mortgage to be a third of your gross income. Calculate the price of your home in reverse that way.
3. Find a mortgage broker who will give you a range of value your home can fall in and also your monthly payments.
4. Use
this handy calculator at
5. Ask
Ginnie Mae!

First-time Buyer Fools, Sep. 2007
It is my belief however that they will be laughing all the way to the bank when this market turns. And I will be the first to congratulate them. I'm so proud of clients that know what they want and go for it even in the face of fear.
For first-time buyers, it’s a no-brainer!, Sep 2007
So what if prices fall another 10% - if you plan on holding on to the house for five years or so, you will still walk away with a nice profit, tax-free.

Huh??? Prices are poised for a continual drop for the next 5 years, or until they come back down to historical affordability ranges. Why is it that as soon as a moron gets a Realtor license it instantly makes them experts in real estate, finance, and investing. Pathetic.
and... Purva on Affordability
Question: When will the average list prices get in-line with average incomes?For example, you wrote the average price of those duplexes was $381,133. Assuming 20% down, that leaves a loan of $304K. Using 4x gross income as the affordability factor means you need an income of $76K. Does the average person is Sacramento earn $76K? I thought the median income in Sacramento was $42K.
Purva: Maybe never. As long as someone can buy a house at a certain price, that will remain the list price and sold price. The average person does not shop at Nordstroms, for example, but it's still around. Sometimes we get all caught up in averages and statistics when really we need to ask ourselves the question of does it make sense to me? If it makes sense to you financially to buy a duplex, go ahead and do it. If not, don't.
Purva's Blog

Sherman D. Harmer Jr.

Sherman D. Harmer Jr, HomebuildingReal Estate Guru
After reading this guys drivel, you might want to read this: Rent Vs. Buy Myths. Why is it these kooks never want to talk about affordability using practical measures of price and personal income?

2008-02-13: The Time to Buy a Home (Does he mean "House"?)
Consider the facts: Prices are competitive, interest rates are very affordable, there are plenty of homes in all price ranges to choose from and sellers are more likely to bargain.

The FHA loan increase will also help first-time buyers realize their dream of homeownership. FHA conforming loans require 10 percent down, not 20 percent. That means San Diegans can earn substantially less annually and still qualify.

So why have so many prospective home buyers been waiting?
It appears they allowed emotions to overtake common sense.

First-time home buyers who are choosing to “play it safe” and keep renting are essentially postponing the opportunity to build home equity. No one can accurately predict the peaks and valleys of the housing market. If you sit on the fence and wait for the absolute best deal, you could end up literally waiting for years, and in the meantime miss out on the opportunity to become a homeowner while prices are moderating.

Not to be overlooked are the tremendous tax benefits received by homeowners as they accumulate equity in their homes. History shows that buying a home is one of the very best financial investments available to a typical household, and a relatively small down payment enables the buyer to see appreciation on the entire value of the property.

In today's housing market, the real risk is in waiting to buy a home
. (Huh???)

Tuesday, February 12, 2008

Robin Camacho

Robin Camacho, Realtor, American Realty & Investments
Is the typical realtor paying attention to the debacle unfolding in the banks? Are they aware of the serious liquidity problems plaguing the financial system? Do they understand how this affects home lending? So sad, but we have another bottom caller.

Oh, Robin, No Mas!!!

2008-02-09: Median prices fall
"I'm ready to state unequivocally that we've reached the bottom of the market in terms of sales," Realtor Robin Camacho said. "Rising demand will equal rising prices at some point in the near future."

2007-12-12: A glimmer of hope for LV housing
"It appears we have reached the bottom everyone is waiting for," Robin Camacho of American Realty & Investments said. "December is looking horrible, but it's December and it's always the worst month. November did finish flat. Pending sales were rising, then stalled. Now they are rising again, which means in 30 to 60 days, sales should be rising.

Sunday, February 10, 2008

Roberto Gomez

Roberto Gomez, $1M House "Owner"
We're back to Sonoma County, land of million dollar house owners renters. What is it about Sonoma, that everyone thinks they're entitled to a "million-dollar house"? Just like the Carnes' and their super Realtor Chris Nunez, Roberto had to have that million dollar house. With a wife (just one) and a daughter (also just one), he needed 5 bedrooms and 3000+ sqft. I'm beginning to think that Sonoma was Ground Zero for collusion to commit mortgage fraud.

2008-02-10: One homeowner's tale of lending woe
Roberto Gomez said he gambled, with assistance from his mortgage broker, that the 3,400-square-foot, five-bedroom, four-bath house would continue gaining value so he could refinance into a less-risky loan. It was spring of 2005 and Sonoma County’s housing market was booming.“I was really happy because it’s a big house. (Ty: Is this how people measure happiness?) They kept telling me the values would go up. I figured I could refinance and fix my payments,” Gomez said. (Ty: Explain the part to me about a guy that makes $72K/year and is able to afford a $1M+ mortgage, with or without a refi.)

Gomez would not have qualified for the loan had he put down his actual earnings, $6,000 a month, rather than the $19,500 income he stated. (Ty: Liar, liar, pants on fire!)

2008-02-10: Ben's Blog
A comment posted at the story:
The man just ADMITTED to committing: (1) felony conspiracy to defraud by obtaining money under false pretenses; and (2) felony fraud by obtaining money under false pretenses.

Here is the McMansion...
260 Appaloosa Trl, Healdsburg, CA 95448
5 beds, 4.0 baths, 3,216 sq ft
For Sale: $1,298,000
APN: 003-110-019-000
Description: Rare Single Level! 10' ceilings, marble and French oak floors. Chef's kitchen featuring granite countertops, stainless steel appliances and SubZero fridge. 5 bedrooms, 4 baths including sumptuous master suite. 2 fireplaces, elegant formal dining, spacious family room, sparkling swimming pool and small Syrah vineyard. Wonderful Healdsburg wine country lifestyle only 5 minutes to the Plaza. .88 acre.

Sale History
06/03/2005: $1,200,000
03/30/2001: $851,500

I'm sure Mr. Gomez regularly entertained his "high society" friends in his million dollar home. BWAHAHAHA

Lori Staehling

Lori Staehling, President of the San Diego Association of Realtors
Hooray! She's the president!!!

Update 2008-02-09: Homeowners could catch a break
Lori Staehling, president of the San Diego Association of Realtors, called Congress' action “incredibly good news.” “I would anticipate a spike up in sales,” she said. (Ty: That's because you're a fu**ing idiot, Lori)

In the past two or three weeks, lenders have reported an increase in prequalification loan applications, Staehling said. “That's the first sign for us (of a possible turnaround),” she said. “I've also heard signs from real estate agents that open houses are being much more heavily attended.”

Now, with the new limit higher than the local median, buyers will have more wiggle room. “It's going to open up a window of affordability,” said Greg Wickstrand of Home Services Lending. (Ty: Can someone explain to these idiots that increasing the conforming loan limit doesn't magically make houses more affordable.)

2008-01-11: Carlsbad 92011 holds the fort on home prices

Lori Staehling, incoming president of the San Diego Association of Realtors, said the current market is filled with buyers sitting on the fence.

“So much is driven by people's thinking,” she said. “Everybody wants to buy at the bottom of the market. But you never know what the bottom is until you've gone past it.”

"But you never know what the bottom is until you've gone past it.”
Is this the new battle cry of the NAR? Many realtors are using (abusing) it.

"So much is driven by people's thinking"
Well, moron, people are thinking...
- that they cannot afford current home prices
- that current home prices are unrealistic
- that lending standards are tighter and loans are more difficult to obtain

And you wanna know something... waiting for the absolute bottom, and watching things start to come up is a perfectly fine opportunity to buy. Lets face it, after we hit bottom, it going to languish for many months. Perhaps by that time, Realtors and mortgage brokers will be gone.
Guess what? The NAR will be coming to San Diego in '09.
2007-06-14: Realtors group inks '09 date for first San Diego meeting
“I think it's great news for NAR and San Diego,” Staehling said. “We've had a lot of California Association of Realtors meetings here and, obviously, it makes a great impression. People come here and love the downtown area and everything that's happened to it.”

By 2009, Staehling said, real estate should be on a roll once again. LOL

Saturday, February 9, 2008

John Husing

John Husing, Private Economist, Ph.D
Tell us more, Dr. Idiot.

2006-06-20: Calculated Risk
There's just too strong an economy and too much job growth for much other than the "soft landing'' Husing and other economists have been predicting for the end of the five-year housing boom."We are right on the cusp of a very powerful period in job growth,'' Husing said. "Local [Inland Empire, San Bernardino/Riverside area] unemployment in May was 4.2 percent, and that's the lowest I have seen for May in 42 years of studying the local economy.

"If we are lucky, prices will go flat,'' he said, suggesting that we could see five years without price appreciation. [Thornberg]

That may be true elsewhere, Husing said, but it won't happen here."Is the housing market vulnerable?'' he asked. "Yes, it is. But is a bubble likely to happen? No, it is not. The underlying strength of our economy is too great.''

2007-06-07: Inland Empire economy continues growth
Historically speaking, the doldrums surrounding the housing market are not as serious as they appear, economist John Husing said at a forum in Riverside.

"We do not have an underlying weak economy." Husing said the Inland housing market is in the midst of an 18-month pause, and will likely see annual depreciation in the median sales price of 5 percent this year.

2008-02-08: Falling Inland home prices still too high
Inland economist John Husing called the recent improvement in housing affordability "dramatic," but he said he does not believe homes ever again will be as affordable as they were in 2000. "That's ancient history," he said.

A persistent obstacle to affordability, Husing said, is posed by environmental restrictions that make it impossible for builders to produce enough homes to satisfy the needs of a growing population. A chronic shortage of supply, he said, tends to push up prices.

Friday, February 8, 2008

Rosalee and Ernie Schimpf

Rosalee and Ernie Schimpf , Sellers
The Schimpfs were featured in an article back in September at It's a fascinating view into the unreasonable mindset that infected anyone associated with housing. The Schimpfs put a price tag on their home and are unwilling to lower it to the true value of the house.

Update 2008-02-08: Schimpf Sale
Price: $449,000
Follow the link above. Do you think 2-acres in Stockton is worth half a million bucks?
In the description it says, "SELLERS RETIRING". I think this means it's worth every penny. How else can they retire? BWAHAHAHA
Anyone looking to buy in Stockton needs to watch this video - Housing Crisis.

2007-09-02: Stockton couple feels the pain of slow market
They can't get any serious offers, though, for their 1,700-square-foot home, plus finished basement and a 600-square-foot workshop on two acres. They got the property appraised and initially set the price at $589,000 in May, later lowered to $549,000, a price below anything similar in the area, they said.
Still, the only offer they have gotten came in at almost one-third below asking price. "Guess he figured that if you're desperate, you'd take it," said Ernie Schimpf , retired from the Stockton Fire Department.

If you assume the offer was 1/3 below $549K, that puts it at $362K. Here are the Z-Estimates for their property in September and December:
4016 Hubbard Rd, Stockton, CA 95215
Sep: Zestimate®: $450K
Nov:Zestimate®: $394K
Dec: Zestimate®: $356K
Jan: Zestimate®: $316K Ouch! This is dated Jan-3.
That offer is now well above the current Z-Estimate. The true value of their home is probably closer to $250K. And given they are in Stockton, its value might go well below that. They would have been smart to take the "low-ball" offer.

The 5 markets where home prices will fall the most (peak to trough decline):
- Punta Gorda, FL 35.3%
- Stockton, CA 31.6%
- Modesto, CA 31.3%
- Ft Walton Beach, FL 30.4%
- Naples, FL 29.6%

"We really want to go," she said. "I feel it's worth what we're asking."

That's very touching, Rosalee. But as the saying goes, "Your house is only worth what someone is willing to pay for it."

Kevin Mims

Kevin Mims, Writer / House Buyer ATM User
When it comes to housing, it's best to keep your mouth shut if you've done something suspicious. You cannot erase the tracks of your actions. I wonder if he had any intention of ever repaying the debt. Of course, all inductees to the Housing Bubble Hall of Shame are innocent until proven guilty in a court of law. *wink-wink* For some, this Housing Bubble was a Money Train.

2008-02-07: When the subprime crisis hits home
KEVIN MIMS: Twenty-seven years ago my wife and I lost our home to foreclosure. She and I and my two young stepdaughters lived there for less than two years, but it was our first home together. We loved it.
My wife and I met while working together at a title and escrow company. Now a real estate slump had cost us our jobs. The foreclosure process took several months. It felt like a deathwatch. Eventually the bank came along and pulled the plug. Afterwards we swore we'd never allow ourselves to become emotionally attached to another house. We moved frequently, so it was easy to keep our vow.
But four years ago we bought an 80-year-old home in a nice Sacramento neighborhood. My wife, an escrow officer, and I, a notary public, were earning good money. We had every intention of staying here forever, but the subprime lending crisis has triggered another real estate meltdown. Now my wife's salary has been cut and her bonuses eliminated. My notary work has dwindled to a trickle. It becomes more difficult to make our house payment each month.
Financially it doesn't make sense to even try. We owe about $430,000 on the house. It's currently worth no more than $400,000. Selling isn't an option. Sooner or later we will probably give up another home to foreclosure. The interest rate is competitive, six and an eighth, and it's fixed until August of 2012. A sudden upward adjustment of our loan won't force us out. It's the sudden decrease in our incomes.
I suspect foreclosure will be much more difficult at 50-something than it was at 20-something. We've imprinted our personalities on this place more than we ever did on our first home. On the bright side, my stepdaughters are grown up. We won't have to uproot them. The only downside for them is, they may end up housing us for awhile.
--1821 Commercial Way, Sacramento, CA
What he failed to mention: (hat tip to Sacramento Real Estate Stats)
June 2004: purchase for $350,000 ($315,000 first from Saxon, $35,000 down)
February 2006: $100,000 cash out from JP Morgan
June 2007: Refi into a $360,000 first and $67,500 second from NL Inc

Questions I have:
- Where has he been living the past 27 years?
- If he sold his previous home, where did the money go?
- What did he spend $100,000 on?
- What kind of ARM did he use that it resets in 2012?
- In his 50's, how was he planning on paying back $300K in his golden years?

Kevin, keep baking cookies.

Thursday, February 7, 2008

Joe Ripplinger

Joe Ripplinger, House Owner Renter
Option ARM -- another way to say rent.

2008-02-07: Exploding ARMs
Feb. 7 (Bloomberg) -- Joe Ripplinger took out a $184,000 mortgage in 2006 and makes his payments every month. Now he owes $192,000.

The 66-year-old Minneapolis house painter has a payment- option adjustable-rate mortgage. It allows him to write a check for $565 a month even though he owes $1,300. The difference is added to the mortgage, and when his total debt reaches $212,000, or after five years have passed, he said his monthly minimum could jump to about $2,800, which he can't afford.
"We're barely making it right now,'' Ripplinger said.

"I never heard of a payment-option ARM before,'' said Ripplinger, the Minnesota borrower. "We thought they were putting us on a 30-year fixed. They didn't put us on a 30-year fixed. I believe that's why a lot of people are losing their homes now.''

If he's barely making it on $565/month in rent, how could he have made the payments on a 30-year fixed?
He's 66 and he's looking for a 30-year mortgage! LOL
Bubble? What bubble??

Tuesday, February 5, 2008

Stock Plunge

Stocks Plunge on Service Sector Weakness

NEW YORK (AP) -- Wall Street plunged Tuesday, driving the Dow Jones industrials down 370 points after investors saw an unexpected contraction in the service sector as evidence the economy is sinking into recession. It was the Dow's biggest percentage drop in almost a year.
A broker looks up from the trading floor of the New York Stock Exchange a short time before the closing bell Tuesday, Feb. 5, 2008.

Yep, dude, the party might be over. The Service Sector was blamed for the drop. Consumer spending is next in line.

Friday, February 1, 2008

Housing Meltdown

Lets take a brief break away from Hall of Shame Inductees to see the fruits of their labors. Here is a great article from Business Week. This is end-result of all the shameful activity that has been going on the past few years. My biggest concern at the moment is where to put my money. I've moved a lot of my 401K out of stocks, although I will continue to buy into stock funds with my weekly contributions, thinking I'll buy on the way down. I'm predicting S&P 500 finishes the year around 1000. If it's flat, or rising, I suppose that could be the effect of davaluing the dollar. There's just too much volatility in the market right now. It's scary out there.

2008-02-01: Housing Meltdown
Why home prices could drop 25% more on average before the market finally hits bottom
Starting in 2000, home prices soared far above their long-term trend. They've only just started to return to normal. This chart shows the history of home prices adjusted for inflation going back to 1890, compiled by Yale University economist Robert Shiller. The black line is BusinessWeek's calculation of the long-term trend growth rate: just 0.4% a year after inflation.

The drop in stock prices earlier this decade shows how overpriced markets can abruptly decline. This chart shows the Standard & Poor's 500 stock index adjusted for inflation, stated in 2007 dollars. Prices got back on trend in the last few years, though they've been falling in 2008.