I've blogged about 3rd party sales being en feugo, I don't have a historical record before 2007 but I wouldn't surprised if the last few months were an all time record for third party sales at trustee sales.
Believe (but cannot prove) that some foreclosure auction discounts are short sale related.
Example:
. $400K owed
. $200K short sale offer
. Bank goes to foreclosure auction, sets minimum bid $200K
If it goes for more, Bank does better than short sale.
If no one bids at auction, property goes to Bank, Bank tells person making short sale offer, "Congratulations, your offer is accepted."
.
[based on sparse data set: saw the numbers matched between the short seller ask and the foreclosure ask on a couple houses. The rest is my speculation.]
Knife-catchers, bottom fishers, whatever you want to call them. I think of these folks as the "early" innovators whose "loss" allows others to follow-suit. Before there was a $200 i-phone a ton of folks were willing to buy the $400 i-phone. Before shelter costs decreased by 80% there were folks willing to innovate and shelter for 40% less!
Matt Padilla: "The discount is what the bank is willing to accept; it’s not directly related to the current market value, though I am sure the bank has a ballpark value in mind when it decides how much to accept."
Yeah, 10% over what they were offered for the paper.
Calculated Risk: "Normally lenders just bid what they are owed at auction, but I've been hearing for several months about some lenders bidding substantial under the amount owed."
What you mean normal, Willis. That was the old days. Lenders aren't bidding what they are owed unless they want to own it.
The real scoop is yes, it is as wonderful ... but then he's not the one making cheese, butter, sour cream, etc. I think having our cows was probably one of the smartest things we've ever done. Not only do I like the idea of never going hungry - with about a bizillion kids that could come home during tough times - but they are relaxing and enduring.
(He's also not the one scooping poop - until the baby leaves in a year or two).
People ask me often if we "break even" with Milkshake. We probably don't now - but did before dairy started coming back down recently. Beyond that, we "break even" because I buy NO dairy at the store and save the money we would have used to buy something every trip you make in to buy a gallon of milk. Besides, they are also our entertainment budget and our vacation budget - we can't ever leave home!
I haven't seen that. From what I've seen the foreclosing party has specific guidelines for how they price REOs. Usually it is some price relative to BPO (Broker Price Opinion). A servicer will order a drive by BPO (or two or add in an AVM) and get a price. Then there guidelines base the trustee sale price off of that BPO.
For example, Wells Fargo Home Mortgage servicing a Freddie Mac loan.. Freddie Mac guidelines say the trustee sale price is dictated to be 100% of FMV. The only way you will buy that home at the trustee sale is if the BPO came out wrong for some reason. In fact that was what investors were doing, knowing the market and finding the few mistakes floating around because banks weren't generally discounting.
But since 2008 you are seeing some more liquidation based pricing. 80% of BPO or 75% of BPO. Sometimes the BPO is off (low) and then you get a frenzy.
By studying the servicer, lender combination you can many times figure out what a properties opening bid will be.
I don't really think the last couple of months have been extra so active for investors because the lenders have changed guidelines. I think its been so active because inventory is so light on the low end that investors know they can push price (like it or not, it is true on the low end). The combination of FHA, tax credit and sub-5% interest rates has really spurred demand. The spike in interest rates in the last couple weeks really put a chill in the market. With rates heading back down expect things to heat back up.
I've blogged about 3rd party sales being en feugo, I don't have a historical record before 2007 but I wouldn't surprised if the last few months were an all time record for third party sales at trustee sales.
Good tracking Effective Demand. You're probably right on record third party sales. My guess for pre-2007 would be that under 2% of all trustee's sales went to third party buyers, at least on residential sales.
Re CR's comment on Jim's video and 18 offers: it seems like anything immediately livable as a listed REO in my area is getting multiple offers, but some are starting in the high five figures, so I wouldn't call it a big deal yet.
A 5-bedroom place in Newport Beach at 19 Coral Cay went straight back to the bank. The bank/servicer asked $3.3 million, just a little more than what was owed on the first (don't know if there were other liens). Hey, Zillow says its worth $4.3 million. Didn't any of the investors check Zillow?
" More than 200 properties were originally scheduled for auction on Friday, but the day before I counted just 94 still scheduled for June 26.
The auction started at noon and two hours later only about a dozen had been auctioned, with more than half going back to the bank. I had enough and left. However, I plan to attend once a week or so, and am happy to meet any blog regulars at an auction."
I was being facetious, but Zillow says a 5-bedroom at 21 Coral Cay sold in April for $4.1 million. Prices slide slowly along the coast. I see the foreclosure nearby as a comp killer for that neighborhood.
This PDF from sprott details how past buyers of govt debt need to triple their 2008 purchases to fund the 2009 $2T deficit. Also states medicare and SSec are sellers of bonds too so the deficit is actually higher.
"As we hope the breakdown above has revealed, the future solvency of the United States as a nation state is currently in jeopardy. It is in far deeper trouble than the mainstream press cares to admit. There are simply not enough new buyers of debt on this planet to support the spending programs of the United States government - and it appears that current holders of debt are beginning to sell. Because it is impossible to balance the budget from outside sources of capital, the only source of funds left for the US, in all reality, is continued money printing."
That's what I've heard. A friend and spouse just did a bike trip on the O.C. Coast and came back with numbers that I think are just incredible. I realize it's a desirable place, but "wow," it just doesn't make sense to us inland folk.
true. the "frenzied" bidding was only on the handful of properties with the steepest discounts. on one property two investors big against each other a dozen times within a couple of minutes. Interestingly, even then they stopped with still $100,000 or more off the debt and off Zillow's estimate. I just use Zillow because it is quick and easy; I imagine the investors have a good idea of comps in areas where they are bidding.
they stopped with still $100,000 or more off the debt and off Zillow's estimate
.
The winning bidder has to pay off liens in addition to whatever they bid. So if there are IRS liens, other liens, they discount will be less than 100K
I have to believe the coastal areas are going to be hit fairly hard in the next year or so. The prices will always be astronomical compared with the rest of the state, but I still think that the pool of available buyers will be shrinking.
Just the SoCal part of the coastline goes on forever. Will there be that many people willing to pay millions for the privilege of not having to walk a couple blocks to see the water?
remind me of the argument; why the dollar will NOT blow up
.
Well, there's three arguments (maybe more)
1. Blow up against what? The pound?
2. It didn't blow up last year, or the year before, or the year before, or ... therefore it won't blowup now.
3. USA economy to recover: "fundamentals strong", therefore won't blow up.
.
Just listing the arguments, not asserting them.
OT to barfly, left you a reply on the last thread. I didn't get his comment either, but I'm trying not to be confrontational, especially on stuff that doesn't really matter.
One last note about the auction, I just checked the final results on Fidelity's site (The page cannot be found and found about 21 were auctioned with about 6 sold to investors (I say about because I skimmed over the results). So all the rest, more than 200 properties, were postponed! (I originally said 180, but actually 226 were once scheduled for June 26)
So investors bought 30% of what was offered that day. Can't conclude anything from one data point, but interesting.
Another thing, if one assumes 21 business days in a month, that's 441 foreclosures. There are also foreclosures at Placentia Civic Center and may be more at other places, but I am not aware of any other auction sites.
In any case, the highest monthly total in Orange County during the '90s downturn, was more than 600. So even with the foreclosure moratorium in CA and Obama's foreclosure prevention efforts, June will likely see more foreclosures than the peak of that down cycle.
Long term there are going to be more sellers of houses than buyers due to the retiring boomsters and others who need cash. Many more foreclosures on the way. RE price gains will be nominal only.
Chasing hyper-inflationary gains with leverage: the new engine of economic growth.
In any case, the highest monthly total in Orange County during he '90s downturn, was more than 600. So even with the foreclosure moratorium in CA and Obama's foreclosure prevention efforts, June will likely see more foreclosures than the peak of that down cycle.
Now that's scary because it suggests the second half of September might see a deluge beginning to form in the full tsunami sense of a deluge.
It appears the OC has a extremely high level of investor activity. I don't know OC very well at all. But that level seems more speculative than fundamental investment driven. But that is a guess.
ED, thanks for the chart!
What exactly does the y-axis represent? Notices of Sales, # offered for sale, # back to benefactor, # sold to 3rd parties, or ???
The Y axis is the count of trustee sales. So if you take the total count - the red line (which represents third party sales) you would get the homes reverting to the bank.
For june (up until Friday) that is 563 going back to the bank 242 going to a third part for 805 total trustee sales.
I can send you instructions on how to do the data pull if you want (you can send me an email via my site on the right hand side or just post an email addy here, your choice). It maybe took 15 minutes to generate that chart. Once you have the initial data pull it is trivial to maintain it. I can also send you the data set I have from 2007 forward so you wouldn't have to do the initial work if you don't want to.
Some trivia - just did a data dump - Fidelity asap lists ~3815 foreclosure auctions for yesterday in California.
Of these, only 58 sold to 3rd parties, 337 were "back to benefactor" (nobody bid). There rest were cancelled or postponed.
.
Of the 58 sold, 8 don't list a Notice of Sale price. Looking at the 50 with a Notice of Sale price, the average discount is 53% of notice of sale price.
Based only on Friday (and one foreclosure servicer), lenders are taking 50% haircuts to move houses at foreclosure auction. I wonder how well the "back to benefactor"'s perform on MLS?
Bad inflation in necessities, commodities, hard assets.
The dollar could devalue against commodity currrencies, usd.brl, or any other country in the world with a positive balance of trade and stable, solvent government.
When we are bankrupt, we are bankrupt. Any nation not bankrupt at that time should have gains vs dollars.
"Fidelity asap lists ~3815 foreclosure auctions for yesterday in California.
Of these, only 58 sold to 3rd parties, 337 were "back to benefactor" (nobody bid). There rest were canceled or postponed."
gulp.
"50% haircuts to move houses at foreclosure auction"
I would think you would see it come through numbers in the other counties if the banks got motivated and started liquidating at trustee sales. I don't think they would go "price it 95% of BPO in LA" and "75% of BPO in the OC". Just my observation.
All rumor but ...
. I talked to a guy who buys REOs directly from banks (post-foreclosure). He says the process for doing "dropped bids" (bids less than owed amount) is inconsistent and driven by local realities within banks. He asserted the banks had BPOs on basically everything before the auction, but would drop some below BPO because... because... , well because an individual or department needed to move inventory. Like the target was you're supposed to have, say, no more than 25 REOS, and you're about to get 27 if two go back to bene, and you've got a meeting with the VP tomorrow morning, so you drop the price on 2, they sell at auction and BANG! you're OK for your meeting.
.
I don't know if I believe it. Wouldn't the VP also be interested in recovery rates?
Anyway, the guy said hey there's all kinds of buearacracy and internal metrics, so sometimes the outcomes are inconsistent.
.
I'd like to hear directly from a banker. Someone in a foreclosure department. Anyone?
I found real green shoots tonight. I hadn't been in downtown Boise for perhaps three months. Tonight's surprise was five (5) new restaurants either already open or "opening soon". And that's just in one quadrant. Likewise, a new store opened in my favorite pool-playing strip mall.
OTOH, business looked bad at four places i visited, down perhaps 15-20% from 90 days ago.
Could be today's weather.
IA bunch of people are getting suckered into failure if spending doesn't pick up soon.
Had this weird dream that a guy named Achmed joined the party and said he was a millwright and there was something about short hedges and cops before it all ended with a dog, a fly and a fan rolling around on the lawn.
Good grief. Fundamentally wrong on about a dozen levels, but the main crimes against logic are in stated causality, proportionality, and selection bias.
Hardest hitting MJ article I've seen yet.
He understood too little about people and the world.
I was equally deluded until... oh, i suppose 1995-1997.
Maybe the world changed.
broward,
that's an excellent article on Jackson... very informative and convincing! thank.
....
so many followers of Roubini here, my guess is he'd like my security apparatus far
more than the women seen in his 'Rock Hudson' photo-ops
no, I just try and conform to the BBC broadcast rules of restricted hours for mature content...
and I assume some of you are church goers and don't want to put bad thoughts in your head
just as you're heading off to services...
plus, not all comments are the same, some might be like a Tweet, a short shelf life and don't
deserve Pharaohnic archiving...
....
the list of Logged In sure has a different read to it... many names I've never seen...
I think some areas have hit a reasonable bottom but will still fall as more desirable areas falling will drag them down. This can be as simple as a Dead Cat Bounce.
HomeGnome
last night I had to tend to my hell raising security apparatus. they were pretty bruised up after an early dawn rumble...
damn, they can drink beer like, well.... guys!
Out here on a different and less-developed section of the California coast -- yes, coastal prices are attempting to hang tough -- though inland it's a different story. Action is still hot in the low-priced ranged -- which around here is in the $400Ks and under. High-end properties are just sitting there, though.
We've got a pretty good rental market here in town -- students -- and I'm told that even at $400K there's a hot investor's market. Everyone's dream to fill up a 3BR with six students paying $600/month each. Wouldn't do much better than break even, but people have told it's a diversity move -- some place to put money outside of equities, cash, t-bills, etc.
Seems like the kids are gathering around the bully and deciding who is going to swing first...
UNITED NATIONS (Reuters) - Western powers appear to have beaten off a bid by developing nations to assert a much greater role for the U.N. General Assembly -- in which they hold a majority -- in tackling the global financial crisis.
The summit, to which all but a handful of countries sent low-level delegations, was for D'Escoto, a one-time foreign minister in Nicaragua's leftist Sandinista government, the centerpiece of his one-year term as assembly president.
Convinced that stewardship of the world economy should be switched from small groups of powerful countries, such as the G8 or G-20, to the "G-192" -- the General Assembly -- he drafted a document proposing sweeping changes.
These included "democratizing" international financial bodies, including abolishing U.S. veto power at the IMF, where the voting system is dominated by rich countries and which imposes conditions on loans some developing countries resent.
HomeG
and so I'm sure do they
...
OT/ just noticed the comment section in the Times,
before your name appeared at the bottom of your
comment in say a size 9 font, now it appears in the
upper left hand corner in about a size 6 font...
... guess they don't want you to build 'brand' ID on
their dime?
HomeGnome - the document proposing sweeping changes was deep-sixed, precisely because it proposed sweeping changes. At least in the dim light of the UN.
C
/edit - and, standing on this record, how could anyone begrudge the G20 their due?
"Since 1999, the G-20 has contributed to strengthen the international financial architecture and to foster sustainable economic growth and development." From mainpage http://www.g20.org
"I can only imagine the damage six students could do to a 3 bedroom rental. "
A real estate agent once told me, "Rent to students? Sure i do. I just factor the cost of a new carpet into the rent." Keeping in mind that student households usually turn over in a year or two.
The moneyed plebes realize that they are receiving just a little bit more than nothing leaving their lucre in the hands of those that might be here today and bankrupt tomorrow, but there are just so many people with do re mi, and oh so many homes available for purchase, the only sticking point being the sales price.
Sword swallowers performing @ Halftime does not a market make...
Now that's an interesting tactic in the Drug War...
KABUL -- Afghanistan's counternarcotics minister said Sunday that his country's drug policy is "perfect," a day after the United States changed course and announced it would no longer support efforts to eradicate opium poppy plants.
Guess DEA is too busy chasing down cancer and MS patients who smoke pot...
Housing students should be a good market if with built in cost, proper damage deposits. I like hard wood floors and porcelain tile floors. Carpet gets expensive on an annual basis.
"Wouldn't the VP also be interested in recovery rates?"
The VP just wants to make his number and keep the VP from having to answer any difficult questions from higher. Of course, I don't know this, I just understand how bureaucracies function.
"There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise."
Cointerpointer...
there was no rough language at all. "mature content deleted" was nothing of the sort... something
far more innocuous, like where is EHP and he had good research notes...
....
I read the article you cited and thought your criticism of it was off the mark and not balanced (seems
you have a grudge with Bloomie)
....
and another post was talking about one of my duo name Strey (pronounced Stray Down),
her extremely feminine qualities and how since she was the only boy amongst 3 sisters
and her wealthy and powerful dad in Battambang would physically abuse her - cut her hair or
beat her when she wore make-up, etc... finally she flew the coop.
... it was a meditation on human sexuality....
I'm sorry I'm obsessed with the MJ thing but from a meme standpoint, it's just amazing.
He CRASHED Google.
Biggest traffic spike ever.
Unreal.
Kind of cool in a way.
"We've got a pretty good rental market here in town -- students -- and I'm told that even at $400K there's a hot investor's market. Everyone's dream to fill up a 3BR with six students paying $600/month each. Wouldn't do much better than break even, but people have told it's a diversity move -- some place to put money outside of equities, cash, t-bills, etc."
A good diversity move, until that $400K house drops to $300K in a couple of years.
How can it be that these banks are not just swimming in cash. Borrow at 0% and loan at 5-8% is just like printing money.
Could the green shoots be in trouble. Unemployment still out of control and unfortunately we do not have anything that even resembles a jobs plan from our wonderful leaders. Bailouts, tarp, health plans but no jobs.
We need jobs, jobs, jobs and I know I sound like a broken record but that should be priority one. Washington's not getting it. Now things are sliding downhill, and no one in the Congress has any stomach to pass another stimulus bill. It would take 25% unemployment (on the record 25%) for the public to be willing to take on any more debt. So we are stuck.
Bottom fishers.
CalculatedRisk,
and you said that housing had become less crazy!
70% off ...
80% is probably closer to value if they sold at the top.
10% is acceptable if they are in good shape or more desirable properties ...
Hey, Mrs Black Star Ranch is online! What's up, girl!!!
Gee TJ no one has ever addressed me here before, I'm a "lurker"
I've blogged about 3rd party sales being en feugo, I don't have a historical record before 2007 but I wouldn't surprised if the last few months were an all time record for third party sales at trustee sales.
Here is the graphics since 2007:
Effective Demand: Foreclosure update for Los Angeles and Ventura County Mid-June 2009
I will have June's final numbers Tuesday night.
Believe (but cannot prove) that some foreclosure auction discounts are short sale related.
Example:
. $400K owed
. $200K short sale offer
. Bank goes to foreclosure auction, sets minimum bid $200K
If it goes for more, Bank does better than short sale.
If no one bids at auction, property goes to Bank, Bank tells person making short sale offer, "Congratulations, your offer is accepted."
.
[based on sparse data set: saw the numbers matched between the short seller ask and the foreclosure ask on a couple houses. The rest is my speculation.]
Well, what did you expect? The second half recovery is coming on Wednesday.
Knife-catchers, bottom fishers, whatever you want to call them. I think of these folks as the "early" innovators whose "loss" allows others to follow-suit. Before there was a $200 i-phone a ton of folks were willing to buy the $400 i-phone. Before shelter costs decreased by 80% there were folks willing to innovate and shelter for 40% less!
Mrs. BSR,
Welcome!!! Please don't be shy. Your husband is certainly a valued member of the commentariat, so no doubt you would be too.
Matt Padilla: "The discount is what the bank is willing to accept; it’s not directly related to the current market value, though I am sure the bank has a ballpark value in mind when it decides how much to accept."
Yeah, 10% over what they were offered for the paper.
Calculated Risk: "Normally lenders just bid what they are owed at auction, but I've been hearing for several months about some lenders bidding substantial under the amount owed."
What you mean normal, Willis. That was the old days. Lenders aren't bidding what they are owed unless they want to own it.
Mrs BSR- What's the real scoop about Milkshake,...is it really as wonderful as BSR says to own a cow?
sdtfs,
The real scoop is yes, it is as wonderful ... but then he's not the one making cheese, butter, sour cream, etc. I think having our cows was probably one of the smartest things we've ever done. Not only do I like the idea of never going hungry - with about a bizillion kids that could come home during tough times - but they are relaxing and enduring.
(He's also not the one scooping poop - until the baby leaves in a year or two).
People ask me often if we "break even" with Milkshake. We probably don't now - but did before dairy started coming back down recently. Beyond that, we "break even" because I buy NO dairy at the store and save the money we would have used to buy something every trip you make in to buy a gallon of milk. Besides, they are also our entertainment budget and our vacation budget - we can't ever leave home!
Most of these will be for rent ....
The rental market is going in the shitter ...
Which is amazing seeing as how many people have been
foreclosed and moved ...
squidward,
I haven't seen that. From what I've seen the foreclosing party has specific guidelines for how they price REOs. Usually it is some price relative to BPO (Broker Price Opinion). A servicer will order a drive by BPO (or two or add in an AVM) and get a price. Then there guidelines base the trustee sale price off of that BPO.
For example, Wells Fargo Home Mortgage servicing a Freddie Mac loan.. Freddie Mac guidelines say the trustee sale price is dictated to be 100% of FMV. The only way you will buy that home at the trustee sale is if the BPO came out wrong for some reason. In fact that was what investors were doing, knowing the market and finding the few mistakes floating around because banks weren't generally discounting.
But since 2008 you are seeing some more liquidation based pricing. 80% of BPO or 75% of BPO. Sometimes the BPO is off (low) and then you get a frenzy.
By studying the servicer, lender combination you can many times figure out what a properties opening bid will be.
I don't really think the last couple of months have been extra so active for investors because the lenders have changed guidelines. I think its been so active because inventory is so light on the low end that investors know they can push price (like it or not, it is true on the low end). The combination of FHA, tax credit and sub-5% interest rates has really spurred demand. The spike in interest rates in the last couple weeks really put a chill in the market. With rates heading back down expect things to heat back up.
I've blogged about 3rd party sales being en feugo, I don't have a historical record before 2007 but I wouldn't surprised if the last few months were an all time record for third party sales at trustee sales.
Good tracking Effective Demand. You're probably right on record third party sales. My guess for pre-2007 would be that under 2% of all trustee's sales went to third party buyers, at least on residential sales.
Re CR's comment on Jim's video and 18 offers: it seems like anything immediately livable as a listed REO in my area is getting multiple offers, but some are starting in the high five figures, so I wouldn't call it a big deal yet.
Thanks for the link love, CR.
A 5-bedroom place in Newport Beach at 19 Coral Cay went straight back to the bank. The bank/servicer asked $3.3 million, just a little more than what was owed on the first (don't know if there were other liens). Hey, Zillow says its worth $4.3 million. Didn't any of the investors check Zillow?
Believe (but cannot prove) that some foreclosure auction discounts are short sale related.
squidward, good insight. Probably true.
deleted
" More than 200 properties were originally scheduled for auction on Friday, but the day before I counted just 94 still scheduled for June 26.
The auction started at noon and two hours later only about a dozen had been auctioned, with more than half going back to the bank. I had enough and left. However, I plan to attend once a week or so, and am happy to meet any blog regulars at an auction."
~~~~
This is a frenzy ?
I was being facetious, but Zillow says a 5-bedroom at 21 Coral Cay sold in April for $4.1 million. Prices slide slowly along the coast. I see the foreclosure nearby as a comp killer for that neighborhood.
Probably already put up...
This PDF from sprott details how past buyers of govt debt need to triple their 2008 purchases to fund the 2009 $2T deficit. Also states medicare and SSec are sellers of bonds too so the deficit is actually higher.
http://www.sprott.com/Docs/MarketsataGlance/June_2009.pdf
"As we hope the breakdown above has revealed, the future solvency of the United States as a nation state is currently in jeopardy. It is in far deeper trouble than the mainstream press cares to admit. There are simply not enough new buyers of debt on this planet to support the spending programs of the United States government - and it appears that current holders of debt are beginning to sell. Because it is impossible to balance the budget from outside sources of capital, the only source of funds left for the US, in all reality, is continued money printing."
Thanks sportsfan, it's late.
Sportsfan, you're like, a gazillion times faster than me.
Prices slide slowly along the coast.
That's what I've heard. A friend and spouse just did a bike trip on the O.C. Coast and came back with numbers that I think are just incredible. I realize it's a desirable place, but "wow," it just doesn't make sense to us inland folk.
mmckinl,
true. the "frenzied" bidding was only on the handful of properties with the steepest discounts. on one property two investors big against each other a dozen times within a couple of minutes. Interestingly, even then they stopped with still $100,000 or more off the debt and off Zillow's estimate. I just use Zillow because it is quick and easy; I imagine the investors have a good idea of comps in areas where they are bidding.
still kinda tuff for me to see any of this as approaching a bottom
maybe a shelf on the steps to the basement where you keep the relative no one wants to talk about
Could someone please remind me of the argument; why the dollar will NOT blow up?
they stopped with still $100,000 or more off the debt and off Zillow's estimate
.
The winning bidder has to pay off liens in addition to whatever they bid. So if there are IRS liens, other liens, they discount will be less than 100K
Could someone please remind me of the argument; why the dollar will NOT blow up?
I have to believe the coastal areas are going to be hit fairly hard in the next year or so. The prices will always be astronomical compared with the rest of the state, but I still think that the pool of available buyers will be shrinking.
Just the SoCal part of the coastline goes on forever. Will there be that many people willing to pay millions for the privilege of not having to walk a couple blocks to see the water?
remind me of the argument; why the dollar will NOT blow up
.
Well, there's three arguments (maybe more)
1. Blow up against what? The pound?
2. It didn't blow up last year, or the year before, or the year before, or ... therefore it won't blowup now.
3. USA economy to recover: "fundamentals strong", therefore won't blow up.
.
Just listing the arguments, not asserting them.
Sportsfan, you're like, a gazillion times faster than me.
Shnaps, I guess Jack is like an accelerator or something.
otishertz: cute word play
read your link, thanks
some people may well be whistling a happy tune while marching off to the 'showers and disinfectant'
b
OT to barfly, left you a reply on the last thread. I didn't get his comment either, but I'm trying not to be confrontational, especially on stuff that doesn't really matter.
One last note about the auction, I just checked the final results on Fidelity's site (The page cannot be found and found about 21 were auctioned with about 6 sold to investors (I say about because I skimmed over the results). So all the rest, more than 200 properties, were postponed! (I originally said 180, but actually 226 were once scheduled for June 26)
So investors bought 30% of what was offered that day. Can't conclude anything from one data point, but interesting.
Another thing, if one assumes 21 business days in a month, that's 441 foreclosures. There are also foreclosures at Placentia Civic Center and may be more at other places, but I am not aware of any other auction sites.
In any case, the highest monthly total in Orange County during the '90s downturn, was more than 600. So even with the foreclosure moratorium in CA and Obama's foreclosure prevention efforts, June will likely see more foreclosures than the peak of that down cycle.
future headline: GREEN SHOOTS SHOT
b
Long term there are going to be more sellers of houses than buyers due to the retiring boomsters and others who need cash. Many more foreclosures on the way. RE price gains will be nominal only.
Chasing hyper-inflationary gains with leverage: the new engine of economic growth.
I saw it, sportsfan, but I'm not so forgiving. His reveling in his "vindication" rubs me the wrong way. I hope he chokes.
In any case, the highest monthly total in Orange County during he '90s downturn, was more than 600. So even with the foreclosure moratorium in CA and Obama's foreclosure prevention efforts, June will likely see more foreclosures than the peak of that down cycle.
Now that's scary because it suggests the second half of September might see a deluge beginning to form in the full tsunami sense of a deluge.
I just generated the chart of trustee sales for Orange County from January 2007 to this last friday.. it can be found here:
Effective Demand: Orange County Trustee Sales Graph
It appears the OC has a extremely high level of investor activity. I don't know OC very well at all. But that level seems more speculative than fundamental investment driven. But that is a guess.
more than 200 properties, were postponed!
.
That's one of the things that makes getting accurate foreclosure rates difficult...
barfly, he almost always rubs me the wrong way. I'm sure he and I will have more spats in the future, but I've decided to let it be on so many levels.
Did Senators Craig, Vitter and Ensign vote for Articles of Impeachment? No, they weren't there then. But they would have.
ED, thanks for the chart!
What exactly does the y-axis represent? Notices of Sales, # offered for sale, # back to benefactor, # sold to 3rd parties, or ???
Effective Demand,
Nice chart. I wasn't aware one could get on ForeclosureRadar the ratio of properties going to investors at trustee's sales by county.
sportsfan, just keep in mind that he will not allow himself to be verbally bested, so no matter what you say, you can't "win".
barfly, I've already won. The political philosophy he espouses has been shown to be bankrupt.
E.D. and Matt P., it just shows non-beneficiary vesting. Could also be buddies taking title.
The Y axis is the count of trustee sales. So if you take the total count - the red line (which represents third party sales) you would get the homes reverting to the bank.
For june (up until Friday) that is 563 going back to the bank 242 going to a third part for 805 total trustee sales.
sportsfan - if anybody here is equipped to joust with him, I'd have to put my money on you.
Goodnight.
Matt,
I can send you instructions on how to do the data pull if you want (you can send me an email via my site on the right hand side or just post an email addy here, your choice). It maybe took 15 minutes to generate that chart. Once you have the initial data pull it is trivial to maintain it. I can also send you the data set I have from 2007 forward so you wouldn't have to do the initial work if you don't want to.
G'night, barfly. Keep the faith. Goodnight, all. Have a good Sunday. The marinas will be busy. Great weather.
Some trivia - just did a data dump - Fidelity asap lists ~3815 foreclosure auctions for yesterday in California.
Of these, only 58 sold to 3rd parties, 337 were "back to benefactor" (nobody bid). There rest were cancelled or postponed.
.
Of the 58 sold, 8 don't list a Notice of Sale price. Looking at the 50 with a Notice of Sale price, the average discount is 53% of notice of sale price.
Based only on Friday (and one foreclosure servicer), lenders are taking 50% haircuts to move houses at foreclosure auction. I wonder how well the "back to benefactor"'s perform on MLS?
[edited out]
"Blow up against what?"
Bad inflation in necessities, commodities, hard assets.
The dollar could devalue against commodity currrencies, usd.brl, or any other country in the world with a positive balance of trade and stable, solvent government.
When we are bankrupt, we are bankrupt. Any nation not bankrupt at that time should have gains vs dollars.
Easy to imagine currency interventions.
"Fidelity asap lists ~3815 foreclosure auctions for yesterday in California.
Of these, only 58 sold to 3rd parties, 337 were "back to benefactor" (nobody bid). There rest were canceled or postponed."
gulp.
"50% haircuts to move houses at foreclosure auction"
50% haircuts increase guerrilla jingle mail.
It appears the OC has a extremely high level of investor activity.
or... maybe more aggressive price cutting?
I would think you would see it come through numbers in the other counties if the banks got motivated and started liquidating at trustee sales. I don't think they would go "price it 95% of BPO in LA" and "75% of BPO in the OC". Just my observation.
All rumor but ...
. I talked to a guy who buys REOs directly from banks (post-foreclosure). He says the process for doing "dropped bids" (bids less than owed amount) is inconsistent and driven by local realities within banks. He asserted the banks had BPOs on basically everything before the auction, but would drop some below BPO because... because... , well because an individual or department needed to move inventory. Like the target was you're supposed to have, say, no more than 25 REOS, and you're about to get 27 if two go back to bene, and you've got a meeting with the VP tomorrow morning, so you drop the price on 2, they sell at auction and BANG! you're OK for your meeting.
.
I don't know if I believe it. Wouldn't the VP also be interested in recovery rates?
Anyway, the guy said hey there's all kinds of buearacracy and internal metrics, so sometimes the outcomes are inconsistent.
.
I'd like to hear directly from a banker. Someone in a foreclosure department. Anyone?
EHP R.I.P
I just discovered John Tamny, or, more significantly, the bile directed at him. He's my new hero.
I found real green shoots tonight. I hadn't been in downtown Boise for perhaps three months. Tonight's surprise was five (5) new restaurants either already open or "opening soon". And that's just in one quadrant. Likewise, a new store opened in my favorite pool-playing strip mall.
OTOH, business looked bad at four places i visited, down perhaps 15-20% from 90 days ago.
Could be today's weather.
IA bunch of people are getting suckered into failure if spending doesn't pick up soon.
removed...
wonder how he went from being a screw up
Every man has his price... particularly if he's obsessed with success.
Duke drank a bit too much tonight, did he?
mature content deleted
my dynamic duo ladyboys got their ass whupped by 4 or 5 Khmer guys
Kinky.
I don't think that white guilt is Obama's trip except in retrospect.
Somebody important recognized that he was charismatic, ambitious yet vacuous and bought him on sale.
Good moorrrrning Marynam. Mmm, java.
Had this weird dream that a guy named Achmed joined the party and said he was a millwright and there was something about short hedges and cops before it all ended with a dog, a fly and a fan rolling around on the lawn.
C
delete...
Looks like someone's having fun at bloomie:
"Surging American Savings Rate Reduces Dependence on China..."
Surging U.S. Savings Rate Reduces Dependence on China (Update2) - Bloomberg.com
Good grief. Fundamentally wrong on about a dozen levels, but the main crimes against logic are in stated causality, proportionality, and selection bias.
C
Hardest hitting MJ article I've seen yet.
He understood too little about people and the world.
I was equally deluded until... oh, i suppose 1995-1997.
Maybe the world changed.
'I'm better off dead. I'm done': How Michael Jackson predicted his death six months ago | Mail Online
JESUS
SAVES
broward,
that's an excellent article on Jackson... very informative and convincing! thank.
....
so many followers of Roubini here, my guess is he'd like my security apparatus far
more than the women seen in his 'Rock Hudson' photo-ops
@Duke - I saw that, and the delete function is your friend.
C
The Duke of Con once again. He's a post and pull cowboy.
Me, I just edit spulling errs and udder midsakes.
no, I just try and conform to the BBC broadcast rules of restricted hours for mature content...
and I assume some of you are church goers and don't want to put bad thoughts in your head
just as you're heading off to services...
plus, not all comments are the same, some might be like a Tweet, a short shelf life and don't
deserve Pharaohnic archiving...
....
the list of Logged In sure has a different read to it... many names I've never seen...
Nothing is carved in relief on line.
I read your post before you pulled it. If it qualified as 'mature' then you must be operating under the Hayes Code
@ Duke
Glad you made it through the night...
I think some areas have hit a reasonable bottom but will still fall as more desirable areas falling will drag them down. This can be as simple as a Dead Cat Bounce.
HomeGnome
last night I had to tend to my hell raising security apparatus. they were pretty bruised up after an early dawn rumble...
damn, they can drink beer like, well.... guys!
I think that Jim the Realtor might have a sweet tooth or a thing for ice cream...
Duke- I prefer 'security apparatus' to 'security detail'.
Out here on a different and less-developed section of the California coast -- yes, coastal prices are attempting to hang tough -- though inland it's a different story. Action is still hot in the low-priced ranged -- which around here is in the $400Ks and under. High-end properties are just sitting there, though.
We've got a pretty good rental market here in town -- students -- and I'm told that even at $400K there's a hot investor's market. Everyone's dream to fill up a 3BR with six students paying $600/month each. Wouldn't do much better than break even, but people have told it's a diversity move -- some place to put money outside of equities, cash, t-bills, etc.
Seems like the kids are gathering around the bully and deciding who is going to swing first...
UNITED NATIONS (Reuters) - Western powers appear to have beaten off a bid by developing nations to assert a much greater role for the U.N. General Assembly -- in which they hold a majority -- in tackling the global financial crisis.
The summit, to which all but a handful of countries sent low-level delegations, was for D'Escoto, a one-time foreign minister in Nicaragua's leftist Sandinista government, the centerpiece of his one-year term as assembly president.
Convinced that stewardship of the world economy should be switched from small groups of powerful countries, such as the G8 or G-20, to the "G-192" -- the General Assembly -- he drafted a document proposing sweeping changes.
These included "democratizing" international financial bodies, including abolishing U.S. veto power at the IMF, where the voting system is dominated by rich countries and which imposes conditions on loans some developing countries resent.
@ Bob
I can only imagine the damage six students could do to a 3 bedroom rental.
HomeG
and so I'm sure do they
...
OT/ just noticed the comment section in the Times,
before your name appeared at the bottom of your
comment in say a size 9 font, now it appears in the
upper left hand corner in about a size 6 font...
... guess they don't want you to build 'brand' ID on
their dime?
175 California Hotels In Default; Sheraton Keahou Bay Resort in Hawaii Defaults; More Defaults Coming
Mish's Global etc.
Has anyone ever match the annual property depreciation to what a CD pays?
double post?
Anyone up for a Pabst?
Page not found - CBS News
HomeGnome - the document proposing sweeping changes was deep-sixed, precisely because it proposed sweeping changes. At least in the dim light of the UN.
C
/edit - and, standing on this record, how could anyone begrudge the G20 their due?
"Since 1999, the G-20 has contributed to strengthen the international financial architecture and to foster sustainable economic growth and development." From mainpage http://www.g20.org
Gnome: maybe "Security Units"
Counter- Even if they don't adopt the policy officially; more forces are aligning against US(D)...
@ Volker
Security Eunichs?
"I can only imagine the damage six students could do to a 3 bedroom rental. "
A real estate agent once told me, "Rent to students? Sure i do. I just factor the cost of a new carpet into the rent." Keeping in mind that student households usually turn over in a year or two.
The moneyed plebes realize that they are receiving just a little bit more than nothing leaving their lucre in the hands of those that might be here today and bankrupt tomorrow, but there are just so many people with do re mi, and oh so many homes available for purchase, the only sticking point being the sales price.
Sword swallowers performing @ Halftime does not a market make...
Security Package
Now that's an interesting tactic in the Drug War...
KABUL -- Afghanistan's counternarcotics minister said Sunday that his country's drug policy is "perfect," a day after the United States changed course and announced it would no longer support efforts to eradicate opium poppy plants.
Guess DEA is too busy chasing down cancer and MS patients who smoke pot...
And we even built a bridge to help them transport the H.
U.S.-built bridge is windfall — for illegal Afghan drug trade | McClatchy
Afghan counter narcotics: that which is sold OTC
Squid, having seen banks work up close and personal, I'd bet
good money on that scenario of making the vp happy is exactly
right.
Wow...things got surreal overnight...
Housing students should be a good market if with built in cost, proper damage deposits. I like hard wood floors and porcelain tile floors. Carpet gets expensive on an annual basis.
"Wouldn't the VP also be interested in recovery rates?"
The VP just wants to make his number and keep the VP from having to answer any difficult questions from higher. Of course, I don't know this, I just understand how bureaucracies function.
Yeah, what was the Duke typing that he had to retract? A great storyteller retracting his best stories told in the cover of the dark night?
The Duke of Con is concerned for the chilrdren.
Besides, things have been surreal for a very long time, Comrade.
The Duke of Con is concerned for the chilrdren.
But not in a Michael Jackson kind of way?
@Volker - heh, yeah, you aren't kidding - turns out your a woman! And here I thought there was a ginormous gender gap on CR.
OK, all gone now. Never mind.
The 3-Letter-Monte shills are up early...
Oh well, too bad I missed it. I don't mind rough language or topics so long so long as they are well written/expressed.
Zack: did you inherit your money?
Thought provoking -
Local Dollar General Refuses To Accept $100 Bills
"There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise."
Wow.
This could be bad.
I missed it too. Put it back, put it back.
Where is Evil Henry? Aren't exams well over?
Lothar - those conditions were not met.
C
Read the Michael Jackson piece.
Still think he was a pervert, but a poor soul pervert.
U.S. citizens are free to abandon the currency in merchant transactions.
It's not good that people are even thinking like this.
Some transaction can not be made in cash.
Those of you in love with silver as an investment should do a little research into how well it did during the Great Depression...
I think it went down to around 30 cents per troy oz.
Some transaction can not be made in cash.
I'd rather not walk into 7-11 in three weeks and hear the clerk say, "Sorry, we only accept Euros now".
Zack: did you inherit your money?
No, stole every dime of it in the markets.
more like broward walks into a 7-11, tells clerk--I'll trade you these pork and beans for an Olde English 40.
zack: How's that going?
If the Euro is in a form of a credit card?
I can't read the graph--it's just a big white square with an icon in the upper
left hand corner.
Also, was trying to catch up on the last thread and it just gets stuck. This
was happening yesterday too.
Cointerpointer...
there was no rough language at all. "mature content deleted" was nothing of the sort... something
far more innocuous, like where is EHP and he had good research notes...
....
I read the article you cited and thought your criticism of it was off the mark and not balanced (seems
you have a grudge with Bloomie)
....
and another post was talking about one of my duo name Strey (pronounced Stray Down),
her extremely feminine qualities and how since she was the only boy amongst 3 sisters
and her wealthy and powerful dad in Battambang would physically abuse her - cut her hair or
beat her when she wore make-up, etc... finally she flew the coop.
... it was a meditation on human sexuality....
Forget the Olde English; go with a tall boy Colt .45
"Works every time"
"... it was a meditation on human sexuality...."
brief though it was
would you like some tea?
@Duke - the redrafting doesn't improve it much.
I have no grudge with bloomie. I just object to random juxtapositions being asserted as a coherent market theory.
C
Thanks for the Cliffs Notes, Duke. Sounds like it wouldn't have bothered me one bit. Not much does with words or images.
.. it was a meditation on human sexuality....
Meditation == Oh-oh-ohhhm Oh-oh-ohm.
random juxtapositions being asserted as a coherent market theory
Too graphic for me, C.
XXX
How was da girl, Broward?
C'mon Liz - make him do at least some work for it!
C
Inquiring minds want to know.
How was da girl, Broward?
She arrives on Wednesday.
No commitment, my ASP.
I'm sorry I'm obsessed with the MJ thing but from a meme standpoint, it's just amazing.
He CRASHED Google.
Biggest traffic spike ever.
Unreal.
Kind of cool in a way.
Google thought Michael Jackson traffic was attack | Webware - CNET
"We've got a pretty good rental market here in town -- students -- and I'm told that even at $400K there's a hot investor's market. Everyone's dream to fill up a 3BR with six students paying $600/month each. Wouldn't do much better than break even, but people have told it's a diversity move -- some place to put money outside of equities, cash, t-bills, etc."
A good diversity move, until that $400K house drops to $300K in a couple of years.
How can it be that these banks are not just swimming in cash. Borrow at 0% and loan at 5-8% is just like printing money.
Could the green shoots be in trouble. Unemployment still out of control and unfortunately we do not have anything that even resembles a jobs plan from our wonderful leaders. Bailouts, tarp, health plans but no jobs.
hat tip to: Financial Opinions Updated Daily iamned.com for the good articles
We need jobs, jobs, jobs and I know I sound like a broken record but that should be priority one. Washington's not getting it. Now things are sliding downhill, and no one in the Congress has any stomach to pass another stimulus bill. It would take 25% unemployment (on the record 25%) for the public to be willing to take on any more debt. So we are stuck.