links 131

said...

Here's one a reader emailed.

Since you track SoCal, I wanted to suggest a topic but
I want to get into the details of the last SoCal collapse that has (to date) been blamed on the Aerospace industry collapse.

Is there a job loss scenario for SoCal that mirrors 1990?

There have be oblique references to losses in the mortgage, banking and construction industries that seem
to be the most likely candidates, but I also have an example that occured to me through personal experience.

I have a relative in Atlanta that has been working in the mortgage industry for the last five years. He owns a condo, but has been also been buying and flipping properties. He knows appraisers who will appraise for 'whatever he wants,' he can arrange for them to get the loan, and walk them through the application so that they don't 'hit any snags.' I am a lawyer and advised him this is really a bad idea, filled with conflicts of
interest and possible fraud, but he advised me that this is standard operating procedure.

This seems to me a very overlooked area of froth (as a shout out to the departing Mr. Greenspan) which might
account for some uncertainty in possible housing devaluation.

8:52 AM
Delete
David said...

The battle between the banks and the National Association of Realtors over what the Fed regulators allow banks to do involving real estate transactions.

http://www.realtor.org/PublicAffairsWeb.nsf/Pages/StopBanksinREProjects?OpenDocument

David
Bubble Meter Blog

8:54 AM
Delete
Robert Coté said...

I want some one subject only threads. That and a little more restraint. When the subject is unoccupied Phoenix housing Boston condo cancellations don't belong in the comments section. Ben will get around to that, be patient.

Single Subject suggestions can mean limited to just one geographic area and let fly, say San Diego or Maryland. It can mean outrageous incentives, free SUV, etc. It can mean a contest for who can show ziprealty or realtor.com the highest price per square foot. Just so long as I don't have to wade through another stupid neighbor buying a boat with a HELOC when the subject is what happens after the super bowl.

9:03 AM
Delete
outersquare said...

http://tinyurl.com/9vn35

Mortgage Delinquencies Increasing

9:17 AM
Delete
flat said...

UK prices up ?
OZ new home sales up
these both started tanking spring 04, what's up

9:23 AM
Delete
SD CDL said...

The radio spots that are STILL played by mortgage brokers. Hayes Barnard of Paramont Equity is the worst. His newest is "the average SD home appreciated nearly 40k last year! You have the power for financial freedom to pay off debt with this new found equity" Like 40k is just like your car keys or that $10 bill in your pants back pocket.

9:24 AM
Delete
DestinSM said...

2 yr 99 18/32 -1/32 4.60 +0.02
5 yr 98 27/32 -1/32 4.51 +0.01
10 yr 99 19/32 +3/32 4.54 -0.02
30 yr 110 25/32 +28/32 4.64 -0.05

A lot of interest in the longer maturities today...

Close to inversion of 2 yr and 30 yr... On that note, when do they start the 30 yr auctions again?

9:32 AM
Delete
Hoz said...

I would like thoughts (other than mine) on the impact of the coastal bubble burst on the midwest housing. Since the midwest takes longer to recover economically and seems to be 1 to 2 years behind the coasts, will the bubble take longer to burst?

9:33 AM
Delete
Bubble Butt said...

I posted on this yesterday but how about talking about interest rates, yield curve and Fed Funds Target and for that matter the recent news that suggests more inflation. How these will impact mortgage rates and lenders and the housing market.

I keep pounding the table on this but lenders are going to have to pull back if this continues - therefore closing the easy money spigot.

Also what it implies for the economy.

30 Year is again down a bunch in yield today while the 10 year is unchanged and the yield on the 2,3 and 5 year are up today. The inversion of the yield curve is getting worse and quicker than before.

Pretty soon we will see the 30 year below the short end of the curve (it is almost there now). The difference between the 30 and 10 year is only 100 Basis points.

9:34 AM
Delete
GetStucco said...

Topic Suggestion: Life after Greenspan

Some questions to address:

1) Will Bernanke abolish the PPT?

2) Will he do it gradually (administer methadone rather than induce fatal withdrawal symptoms)?

3) If he tries to reflate through purchase of l-t bonds, will that lead to higher interest rates (read mortgage rates) due to inflation fears?

4) And hence, won't any effort to offset an Asian pullback from $US assets inadvertently crash the housing market?

5) Will Ben B take measures to end the conundrum?

9:35 AM
Delete
Tom said...

How will the lower unemployment rate influence the FED on its rate changing policy in relation to Ben Bernanke?

Will it be business as usual and they will continue to raise rates or will ben get in and just start printing money???

We all know what affect higher rates will have on the housing market and we know what lower rates will do to the dollar.

What becomes more important to Ben??

9:44 AM
Delete
boca_raton said...

detinsm, The new 30 yr autions start next thursday (not sure how ofter, see treasurydirect.gov)

9:47 AM
Delete
cereal said...

i'm looking for a new bank for my cash. the main thing i'm concerned with is stability in the event of trouble ahead. that and good rates on 6 to 12 month cd's.

and while we're on the subject, how safe is internet banking (ing direct etc....)

finally, do you guys like the ibonds?

9:49 AM
Delete
boca_raton said...

detinsm, The new 30 yr autions start next thursday (not sure how often, see treasurydirect.gov)

9:49 AM
Delete
crash1 said...

How about a job loss update? We all know about Ford and GM. How about other recent announcements? Jobs are the glue that holds it all together.

9:50 AM
Delete
octal77 said...

Are sellers including Freebees?

Are sellers including "freebees"
in your area? (Cars, vacations,
plasma TV's, granite counter
tops)?

Here in Irvine, (Orange County)
California, the Irvine Public
Schools Foundation is including
a BMW 750Li in an "early bird"
drawing as part of its annual
house raffle.

That's a first. See:

http://www.ipsf.net

9:55 AM
Delete
SFtrader said...

What are the top 10 reasons, bloggers on this site havnt bought houses ? Since most people of this blog would eventually want to own one, what levels would they be comfortable with (location as well as % reduction from existing median would be nice)

9:59 AM
Delete
freeloading roomate said...

I'm curious about the relationship between rental prices and home prices. Locally I've noticed home prices double while rental prices have increased about 20% or so. Almost to where it costs about 2x more monthly to buy (80/20 mortgage 100% financing) than to rent.

This makes me believe that people's incomes and demand for housing hasn't really gone up (much).

Is there some way to use this information to make sense of the current housing market?

Seems like there should be a fundamental relationship between what people can pay in rent and what houses are "really" worth... everything else being a factor primarily of preception, speculation, and creative financing.

Something like a P/E ratio for houses???

10:04 AM
Delete
Kirk said...

I suggest people go out and get photos of things that suggest the end of the bubble and upload them to Flick with the tag housingbubble

There are only four photos with that tag right now and Ben can add one of those Flickr web page inserts that show the latest images for a tag. Go here.

We'd have a constantly updating look at the bubble and it'd be simple to do.

10:09 AM
Delete
sfbayqt said...

I suggest people go out and get photos of things that suggest the end of the bubble and upload them to Flick with the tag housingbubble

I have a GREAT photo subject for this topic. I'll take photos this weekend. (Woo hoo! I get to play with my new digital cam. ) :-)

BayQT~

10:16 AM
Delete
Bubble Butt said...

Destinism:

30 Year Bond Auction is February 9th.

10:42 AM
Delete
HARM said...

Which institutions are holding GSE-issued or private MBSs and CMOs (asian banks vs. American mutual/retirement funds)?

Do asian central banks own more of the stuff, or do Americans (through their mutual/retirement/401K/IRA funds)?

While GSE-issued debt is fairly easy to spot on a prospectus/annual report (look for Fannie & Freddie), how can you tell if your mutual fund also owns PRIVATELY-issued MBSs or CMOs?

10:43 AM
Delete
sfbayqt said...

Hi Ben,

To piggyback onto robert cote's comments/suggestion, how about just having some sort of FYI topic? It's obvious that posters are itching to share information to help enlighten and inform the readers, but usually the place to put that information is in whatever the current topic is. Or, they post where the biggest audience may be. I don't know what you would call it other than FYI Financials, or FYI Anecdotal Info...something like that.

My 2 cents....

robert? Any other FYI topic headings?

BayQT~

10:46 AM
Delete
Curt said...

I'd like comments from owners/rentors who actually live in these hi-rise condos so we could have first hand knowledge of the pros and cons.

10:52 AM
Delete
jerkstore said...

I have a question for the board: my mother recently made an offer at full price for a nice condo in NYC. A family friend is tangentially involved on our end. She has had NO response from the sellers after two weeks. Is this appropriate? I'm getting steamed and want her to pull the offer.

10:54 AM
Delete
octal77 said...

"To piggyback onto robert cote's comments/suggestion, how about just having some sort of FYI topic? "

I second the motion. Good Idea.

It would also make it easier to
find such information after-the-fact
in this blogs archives.

Also, I think it would spawn some
creative 'weekend topic suggestion'
ideas.

10:57 AM
Delete
DeepInTheHeartOf said...

Is the tightening up of credit/liquidity being felt by consumers in areas other than mortgages?

I pondered this last night when I took my junk mail and fed it to my shredder. Looking at the unsolicited credit card offers, I noticed that the quality of the offers (Balance transfer terms and CCard terms) seems to be way down in the last few months.

I've got the kind of credit profile that gets great offers by the ton (only 3 cards, plenty of activity (use Amex for everything I can), almost no debt, fico mid-800's, flawless histories) so I'm wondering why the change. As a single sample, this could be because something has changed in my credit reports. (Though it shouldn't have - I'm going to get updated reports to make sure nothing funny has happened).

On the other hand, If I am not alone in seeing this trend, does that mean that lenders are anticipating tougher times and reduced consumer spending ahead? That would likely mean more people using their offers just to transfer balances back-and-forth to keep rates and payments down, and less new purchase spending.

10:57 AM
Delete
OC-ed said...

Tools, Tips, and Tricks.

There are a lot of tools like domania.com I use today that I had no clue about until I stumbled onto this blog. Let's share more of what works for us.

I would wager that there are many bloggers here who have Tips and Tricks used to make sense out of the housing market. Some for watching RE pricing, some for gauging HBS.

If we can put all of these things in one place we may be able to entice Ben into creating a toolbox and a tips and tricks FAQ in his copious free time.

Have a great weekend everyone

and

GO STEELERS!

11:04 AM
Delete
Robert Coté said...

In response to requests:

FYI Breaking News/This Just Out
FYI New Resource
FYI Anecdotes
FYI Thanks Ben/Misc/OT

Seems I hit a sensitive issue for many of us.

11:59 AM
Delete
GetStucco said...

How about a quiz for hedgefundanalysts and other people who think they are smarter and far more valuable than the smartest of PhDs:

What asset is it best to be long in when all other asset classes are going down in value?

http://tinyurl.com/cb79u

12:04 PM
Delete
nobubblehere said...

Cereal,

"I'm looking for a new bank for my cash. the main thing i'm concerned with is stability in the event of trouble ahead. that and good rates on 6 to 12 month cd's.

and while we're on the subject, how safe is internet banking (ing direct etc....)"

I've used Ing direct for about 5 years now, and haven't had any problems with it . . . yet. But lately with all the bad financial news banging about, I'm getting antsy about having my cash in a digital account. If you want to get it out in a hurry, you're out of luck. It takes at least 2-3 business days to transfer funds from Ing to your local bank, then you gotta hope your local bank's doors are still open for business.

12:05 PM
Delete
sfbayqt said...

Looking at the unsolicited credit card offers, I noticed that the quality of the offers (Balance transfer terms and CCard terms) seems to be way down in the last few months.

But that's a good thing, right? I get tired of receiving all that crap mail. :-(

I'm just messin' with ya. I understand your observation and it's worthy of note. I agree it would be interesting if the lack of is related.

BayQT~

12:08 PM
Delete
GetStucco said...

GO STEELERS!

11:04 AM

GO BEARS! (THE HOUSING BUBBLE KIND)

12:08 PM
Delete
patco said...

Here's an idea:

Which of the big public builders will be the best short candidates.
They all have a mountain of debt and a relatively small amount of cash. DHI (DR Horton) seems to be in the best shape.

Any opinions on this.

Right now I'm short some KBH, my thesis being they cater primarily to the first time buyer and have exposure in the formally hot areas. Like the others, "increasing market share" seems to be their single mantra.
Regardless of all other factors, "market share" is the magic solution.

Ideas on best shorts?

12:16 PM
Delete
bearmaster said...

Ben,

I, too, am interested in job loss scenarios for SoCal.

A few years ago Big Pharmaceutical got hit pretty hard, though I'm not sure what the real cause was. It might have had something to do with the dot com bust and the Nasdaq decline generally. I know of one chemist who was laid off at that time and only recently got a "real" job again, at Genentech in San Francisco. He subsisted by teaching intro chemistry at a local community college (I was in that class.)

I'd be curious to know why the downturn in Big Pharm, and could it happen again. After all, they are not profitless tech startups. A big slump in pharm would have a huge effect on the northern bay area and San Diego, if so.

I'm not sure what the big employment drivers are in the LA area, to be honest. There are a number of smallish tech startups. There is also the movie industry. The major studios are already asking big stars to take pay cuts and they are planning on putting out less product for the next few years (not sure if I read that on IMDB or not).

In my area, much is made of the fact that The O.C. is filmed in Manhattan Beach. Big deal - one friggin TV show. Yet an unbelievable amount of froth has been generated around it.

I am only half-joking when I say that the local economy here consists of selling real estate to each other and teaching each other yoga.

12:41 PM
Delete
Caveat Emptor said...

Jerkstore-
I'd pull the offer.

Whenever I've made an offer on real-estate, I've structured the offer for quick expiration... never more than 24 hours. Last time, I gave the seller less than 8 hours to respond. The last thing you want is the seller playing your offer off of another potential buyer. There's no reason it should take them more than a day to make up their mind. My guess is they're holding your offer in their back pocket, while waiting/hoping for something better to come along. That does you NO good.

It's a buyers market- put the screws to them.

That might make a good weekend topic- in a buyers market, what are the best ways folks have found to squeeze a desperate seller?

12:43 PM
Delete
middleageman said...

(1) I agree with robert cote on staying on topic.

(2) I like oc-ed's suggestion of Tools, Tips & Tricks.

(3) I like getstucco's What asset is it best to be long in when all other asset classes are going down in value? I think this should be a regular weekend discussion. It is such a critical decision. I do think, though, that the question contains too many assumptions. I think the statement when all other asset classes are going down in value is open to debate. Obviously most of us are bearish on SFH, but after that I read a large divergence of opinion.

1:29 PM
Delete
GetStucco said...

I think the statement when all other asset classes are going down in value is open to debate.

---------------------------------

Did you try out the link? Because if you do, you might think up a good answer to the question.

(Hint to hedgefund experts: The answer is not stock.)

1:33 PM
Delete
bearmaster said...

Cereal, Nobubblehere,

Have you used Weiss Ratings for bank safety ratings? Nobody is as conservative as Weiss when it comes to rating financial institutions. He has a much better track record than AM Best, Moody's, Fitches, etc, when it comes to warning subscribers of impending bank failure BEFORE the failure.

Just last night we got our annual Weiss ratings book in the mail. A number of banks no longer have the A+ rating - probably because they are exposed to local bubbly real estate markets.

Fortunately Farmer's and Merchants bank, right in Southern California, is one of the best banks in the country, at least by Weiss's standards. Even better, they know about their rating and work hard to maintain it.

Weiss Ratings

My survival strategy has largely consisted of having a Treasury Direct account wired to my F&M savings account. I won't mess with any Treasury money funds from a mutual fund company that might have to go through a bank that... you get the idea.

1:49 PM
Delete
middleageman said...

getstucco said: Did you try out the link? Because if you do, you might think up a good answer to the question.

I see your point, but it seems superficial. If I click on the Europe tab everything is green. Does that mean that I should throw money at European securities?

5:22 PM
Delete
ShameonLyingAgents said...

A topic dedicated to "Market Tracking", where posters would:

Identify the geographic area tracked and other parameters such as Single Family Homes, price range. Also identify the source for the info.

Obviously comments would follow within the same topic.

8:38 PM
Delete