Foreclosure Actions Spread
At this temporary Inman News link can find a report on foreclosures in February. Some of the trouble spots are new. "California had the highest number of notice of defaults on 3,651 properties, followed by New Jersey, with 1,987."
Others continue down the path, "Florida and Colorado, for example, had the largest number of foreclosures, more than three times the national average. In Texas, more than 50 percent of all February foreclosures took place in three counties: Bexar with 10.1 percent; Dallas with 16.4 percent and Harris with 25.3 percent. In each of these counties, the foreclosure rate was more than three and a half times the national average and one and a half times the Texas average."
Bexar is where most of San Antonio is, Harris is Houston. "Texas had the highest number of notice-of-trustee sales at 7,726. And Florida had the highest number of notice-of-foreclosure sales, with 1,284."
When the story is closed out, you can probably find it here later on.
23 Comments:
...that's 'cause your pal is a speculator, not an investor.
http://www.freddiemac.com/news/pdf/contribution_homevalue.pdf
freddiemkac talked of bubbles in 2002.
It is also interesting to read the arguments against the existence of bubble. This is a bit dated (2002) report
Madhu
The pain is only going to get worse:
Minimum credit card payments to go up:
http://www.businessweek.com/bwdaily/dnflash/apr2005/nf20050414_5876_db016.htm
Bankruptcy bill passed:
http://www.businessweek.com/ap/financialnews/D89FD81O2.htm?campaign_id=apn_home_up
If the home equity ATM machine closes down this is going to get ugly.
Today, my husband was at work on a set for a commercial shoot, and all the grips and some others were having a big discussion about the existence of a housing bubble. All but one agreed that it was a big debt bubble on unsound footing ready to burst. They were talking about ARMs, IO mortgages, etc, etc. For those who don't know what a grip is, they are basically blue collar types (no offense to any grips out there). I wasn't quite sure to what to make of what I thought were my "out of the mainstream" views being trumpeted by these guys. I have become accustomed to people thinking I am nuts when I tell them RE is going to fall hard. My gut says, they are a contrary indicator, and the fact that they have all accepted the bubble theory means, no bubble burst.
Then again, none of them have actually positioned themselves for the bubble. So maybe, it just means the masses are really catching on???
Just a story I had to share. This whole thing feels like it is taking on a life of its own. Getting weird.
anon,
"when the going gets weird, the weird turn pro"..HST
Well it's a new paradigm, isn't it?
Seriously, I wonder what affect the rapid spread of ideas (like specualtion on the existence of a housing bubble) via things like the internet has on the existence of bubbles themselves. When I think back to the housing bubble of the late '80s, I wonder if it would have blown so high if people had had a different means of communication. Maybe things like the internet provide a kind of forum of contrary ideas that otherwise would not be heard.
In general though I think the effect is fairly minor in the face of the gawdawful tide of credit washing over the globe. And while technology has made it easier to disseminate ideas about, for example, the "bubble", it has also contributed to the problem itself by enabling the "financialization" of just about everything.
Interesting thoughts. We here on these type of blogs may just be preacing to the choir. I think the average home buyer doesn't pay that much attention to macro economic conditions, its hard to when you just see prices going up and up and all the stories of how much people have made. There was tons of info available 5 years ago about the market bubble but it didn't get through then either.
Prechter had an interesting take on it. He called it the "uh oh" effect. That before the fall, everyone would have a collective "uh oh" moment. Maybe this is it?
(When I think back to the housing bubble of the late '80s, I wonder if it would have blown so high if people had had a different means of communication. Maybe things like the internet provide a kind of forum of contrary ideas that otherwise would not be heard.)
I thought there was a bubble for about a year now. Last summer my father and law and I got into a heated discussion about why we were renting and not buying. I told him that I thought the prices weren't sustainable and he gave me a lesson in what his house that he bought in 1972 was now worth. (It appreciated by 6% a year since then... but don't tell him that you can beat that in the stock market because he lost a lot with the dot com stocks !)
Anyway... if it wasn't for this site, I'd have probably bought something. I always thought that I knew what was going on in the market but everyone told me otherwise. When we started discussing things on this site, I knew that I wasn't a voice in the wilderness and that my common sense would eventually pay off.
I know one thing for sure: the Internet spreads all manner of information, pro and con to housing and it makes people think. I'm sure that that prevents a bubble like we have now from growing larger than it otherwise would.
(the masses are really catching on?)
I remember a couple of years after the Nasdaq bust, Business Week ran a story about how "everybody knew" there was a bubble in spring 2000; baloney! Eventually, the masses do know.
(I wonder what affect the rapid spread of ideas (like specualtion on the existence of a housing bubble) via things like the internet has on the existence of bubbles themselves)
I wonder about that these days, as well. Are we making a little bit of history here?
(There was tons of info available 5 years ago about the market bubble but it didn't get through then)
Financial mania's are a very odd human creation. I don't think about the mindset, I focus on reality. It helps.
(before the fall, everyone would have a collective "uh oh" moment. Maybe this is it?)
Many years in the making, my friend.
(the Internet spreads all manner of information, pro and con to housing and it makes people think)
Thanks for that comment and I look forward to the day I make my last post here, hopefully knowing I spoke out when it mattered.
"Thanks for that comment and I look forward to the day I make my last post here, hopefully knowing I spoke out when it mattered."
That is going to be a long ways away, not because this bubble isn't going to come to an end SOON, but because this site is going to be mobbed by millions of people who suddenly realize that there is a bubble ! They won't realize that this site was about identifying and preventing bubbles... they will want advice about what to do in them.
If your server quit this afternoon, just wait until we get full fledged bubble bursting !
I guess it's time to chime in. As a Bankruptcy lawyer in San Diego I see all the train wrecks. However, I am increasingly seeing the 80/20+ loans whereby the clients are GIVEN $10k at the closing of a purchase on a house they can't afford, on which they made no down payment, on which they will have to pay 60%+ of their disposable income for the mortgage payments (plural!!). I ask my clients WHY did they buy the house??? Their answer: BECAUSE I COULD!!!. The end is near. . . be afraid. . . be very afraid. . .
BK: What is your guess as to when it will burst ? How quick will the "adjustment" be ?
Who is going to get bear the brunt of the damage ? Home owners ? banks ? MBS owners ?
Thanks.
No PMI required on many of these crazy loans, 80/20 or 80/10/10, etc.
bklawyer,
Thanks for the info and please keep us updated.
sunny,
(Private mortgage insurers will be holding some)
You bet. This has to be the hottest question on Wall Street.
Thanks for joining in, we appreciate it.
I've filed BK for ~10 real estate professionals in the last couple months who have no work because of the glut of competition. Too many people chasing not enough homes. Bad scene of other horrible real estate professionals who sell you the 80/20+ home and then when you realize you can't afford the new home you want to sell the price is stagnant the real estate agent/broker/etc. will not help you b/c no money to be made.
I'm not at the top like a lot of you guys, looking at the lenders and the overall financial trends. I'm down in the trenches dealing with the lady who bought a home in Temecula for TOP dollar AND one in San Diego with zero down plus a HELOC (home equity line of credit) which has a SHORT TERM interest rate which has jumped 5% since interest rates have risen. She's walking away from both houses. 2 more in the drink.
You want it, you can buy it.
This time, the housing slump will cause the recession in local and (maybe) the national markets.
bklawyer,
Very interesting comments. Question for you: what is BK law in CA regarding one's house? I've always heard that "you can just walk", but I find that hard to believe -- can one really "walk away" from a mortgage without filing for bankruptcy and/or getting one's credit rating trashed? Also, how does the new BK legislation affect this, if at all? Thanks, and I'll take my question off the air... ;)
"(Private mortgage insurers will be holding some)
You bet. This has to be the hottest question on Wall Street."
But it isn't ! I don't hear anyone talking about this. Everyone was worried about inflation and oil and I don't think anyone realizes that the housing bubble is starting to burst, nor what sort of implications that is going to have on consumer spending, mortgage related companies, commodity demand, etc.
YOU READ IT HERE FIRST.
"Seriously, I wonder what affect the rapid spread of ideas (like specualtion on the existence of a housing bubble) via things like the internet has on the existence of bubbles themselves."
"And while technology has made it easier to disseminate ideas about, for example, the "bubble", it has also contributed to the problem itself by enabling the "financialization" of just about everything"
You are on to something that I've also thought about but not seen discussed anywhere. It sure seems like the speculation and free flow of information on flipping lots and preconstruction condos is similar to the tech stock frenzy a little over 5 years ago. Everyone who had been around the block a few times knew it was crazy but no one thought there was any risk since they had real time information and could cash in their chips if conditions changed for the worse.
"I don't hear anyone talking about this. Everyone was worried about inflation and oil and I don't think anyone realizes that the housing bubble is starting to burst, nor what sort of implications that is going to have on consumer spending, mortgage related companies, commodity demand, etc."
Good point. Which is worse 100M American paying $30-40 a month more for gas or 40M homeowners losing $50K to $150K in equity in their homes?
California has what is called a "one action" rule meaning that the mortgage Co. can foreclose but that is their "1 action" which would stop them from then suing you post-foreclosure for the money owed. One problem is that who only has 1 mortgage on their home? Everyone has a 2d or 3d Mtg. and the "1 action" rule does not apply to them when the 1st forecloses. They can still sue to collect.
I have seen some people who have no problem walking away from their 80/20+ mortgages because they have no out-of-pocket money into the home. In fact, they made $$ on the purchase.
"Good point. Which is worse 100M American paying $30-40 a month more for gas or 40M homeowners losing $50K to $150K in equity in their homes?"
The general population has not come to the realization that these house prices are not sustainable. Everyone is still in "buy" mode, althought I think that is on the cusp of changing. The only thing that keeps people buying is the low interest rates and that is being created by people fleeing from stocks because they are falling because consumer sentiment is falling.
Can anyone see the circle about to close here ? The only component that is keeping the whole situation going is Asia buying our bonds. I'll almost put money on that changing after the upcomming G7 meeting. I expect a blow up between China and the US.
"Good point. Which is worse 100M American paying $30-40 a month more for gas or 40M homeowners losing $50K to $150K in equity in their homes?"
The general population has not come to the realization that these house prices are not sustainable. Everyone is still in "buy" mode, althought I think that is on the cusp of changing. The only thing that keeps people buying is the low interest rates and that is being created by people fleeing from stocks because they are falling because consumer sentiment is falling.
Can anyone see the circle about to close here ? The only component that is keeping the whole situation going is Asia buying our bonds. I'll almost put money on that changing after the upcomming G7 meeting. I expect a blow up between China and the US.
Post a Comment
<< Home