Posted on 05/29/2011 5:14:57 PM PDT by Jim 726
There's a three-year inventory of homes in foreclosure for sale, and that's devastating home prices.
Las Vegas has so many foreclosures that 53% of all the homes sold in Nevada are in some stage of foreclosure, according to a report from RealtyTrac, the online marketer of foreclosed properties.
Foreclosures represent 45% of sales in California and Arizona, and 28% of all existing home sales during the first three months of 2011.
"This is very bad for the economy," said Rick Sharga, a spokesman for RealtyTrac.
What's more, the homes are selling at steep discounts, especially so-called REOs, bank-owned homes that have been taken in foreclosure procedures.
The average REO cost on average about 35% less than comparable properties, according to RealtyTrac.
(Excerpt) Read more at finance.yahoo.com ...
Building in San Diego is not easy. The cost and time getting permits is not owner friendly.
I also do price consulting for lender and know the market from a value point, you have a price point too low for the market
Yep, they’re going to take it from you in taxes over the next 30 years, so you better take it from them at the auction block right now. Besides, 13% return on sub $100K duplexes beats the crap out of 1.5% in the bank, and so what if you have to put $20K into it to make it nice. That part is fun! :)
“Right now it sucks for the realtors and the banks”
It sucks a whole lot more to those of us who are trying to sell a home NOT in foreclosure.
Are you sure that's where you want to buy? There are better locations in the metroplex not too far away which don't cost much more. You might want to look north of DFW or up in Denton County except for a few pockets. There are some parts of northern Tarrant County that are OK, and Collin is like Denton - generally good, except for some bad pockets.
And if you are not familiar with the area, get a map that shows school districts - that can be more important than municipal boundaries.
Why don’t banks pay property tax on foreclosures?
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Same reason they don’t pay the HOA assessments or keep the property in good repair.
We are moving to San Diego because I have a business opportunity there, my wife however is retired as of July 1st. She wanted to look at foreclosures because she thought a fixer-upper might keep her occupied. We are going to take another look at 3 and 5 with a friend of the family who is a contractor. We really liked 5 since I want to bring my son out here and the basement suite would give him some privacy.
We also have a mortgage mess at home thanks to the incompetence of a mortgage servicer that is likely to require a quiet title action. So buying something with cash on hand is also appealing at the moment.
Would building over the line in southern Riverside or Orange be substantially easier?
“Why don’t banks pay property tax on foreclosures?”
They do when they are sold plus penalties.
I’ve got a paid for house I want to sell and get another paid for house somewhere else. I live in Montana but I don’t want to anymore. The only thing I can trade for would be a mobile/modular or someone’s foreclosed property. But at least there have been a few lookers here and I thought I was going to get an offer last week.
“The house are already selling at half the cost it would take to build them.”
Due to labor, union labor, or materials? Already built houses should not (as history has shown) appreciate, they haven’t much for a 100 years of 116 year history (the last years being the boom) when inflation is adjusted out. Also, unless vast improvements are made, historically older houses depreciate with age, so they should be lower than the price to build new anyway.
There are of course outliers, such as a highly desirable area, where people are actually moving to, in response to something local, which would increase demand, but that’s not the standard, it’s the exception.
“That is way under a normal selling price.”
Not historically. But in the last 50 years as the dollar has been dropping in value, the nominal price has been increasing, but with inflation ruled out, houses don’t appreciate just by existing. As they age they are worth less, by the average price of an existing “standard” house on the market doesn’t change much in price.
Sorry, but the missing factor here is the need for a sustainable job market in order to privately subsidize and sustain the purchase/mortgage for a home.
Without job growth, the market is going no where but down.
There's not enough growth to sustain the market nor generate confidence for buyers to purchase a home.
It would require competent leadership and economic savvy in order to boost confidence in the market, inspire job growth and provide an incentive to purchase a home, which in all reality, is a heavily depreciating asset.
In short, we're DOOOOOMED. Ok, maybe not, but we really need a conservative to win in 2012, and take the senate while keeping the house in the process, and drive the socialists into the seas.
Best of luck to you. Hope it all goes well. It is NOT going well here in obamaland suburbs. We’ve been at this for over a year and.....nothing.
Thank you so much...and I wish you well too. This week my job is to stage the house and take out all the personal stuff...There’s a big stuffed rainbow trout that someone said offended them, stuff like that so I have to sterilize it I guess. Maybe that will help.
“Sorry, but the missing factor here is the need for a sustainable job market in order to privately subsidize and sustain the purchase/mortgage for a home.
Without job growth, the market is going no where but down.
There’s not enough growth to sustain the market nor generate confidence for buyers to purchase a home.
It would require competent leadership and economic savvy in order to boost confidence in the market, inspire job growth and provide an incentive to purchase a home, which in all reality, is a heavily depreciating asset.”
Someone else who gets it. A well written, and well thought out analysis. Sadly, I wish the conclusion, “In short, we’re DOOOOOMED,” weren’t true, but it seem to be not only true, but worsening with each passing day! I fear 2012 may not offer the reprieve we so desperately need. I pray otherwise!
There is no union labor building residential houses. That is a side point though.
I should have been more clear in my post. A brand new home, built in a new development and no more that two years old can be purchased now for less than it cost to build.
I'm sure the other points your bring up are correct. I was just not clear in explaining my statement was talking about new homes, not older ones.
Ah, thank you for clarifying. I asked because although I don’t know specifics for all areas, my parents (both former union members, retired for about a decade, and disgusted with unions now), been involved in the building of many houses (electricians). My dad did, however, work for a private contractor for a decade or so, too, off and on, so maybe he built houses there. I was unaware that no labor unions built residential houses, I suppose you learn something new everyday! Thanks again for clearing that up, and sorry I was confused.
Like you, I can't speak for all areas of the country. But here, the union electrical jobs are for big projects like power plants, large commercial buildings, overpasses, etc. but not generally for housing construction (single family homes). There may be a local company that is organized but it is definately not a big percentage of any residential work.
My Dad was a builder all of his life - started his first house just before WWII took him on an extended vacation. Came back and kept at it -retired in 1980? or so.
I used to help out on his projects, and I think back then it was various trades that would sometimes have strikes, and try to shut down large developments. I recall once when the bricklayers were on strike and we had to work-around not having them around for awhile. And we did run the risk of them picketing the project (town house complex at that time). But the main carpenter said - “that’s why I have this big truck, so I can run through a picket line!”.
I do recall my old man saying back in the late 70’s (Carter) - “back in the 50’s I could build a house and from the profit buy a brand new Cadilac in full. Now it is just barely enough for a down-payment on a Chevy.”
He made out okay as he was the “slow and steady” type, and only built far enough out to what he could sell. (It was 1.5 years and one townhome at one point during the Carter years!)
And today, the half-built lots in my town are sitting in ruins. Fancy McMansion’s looking out over half-built house’s of sticks and rotting tarpaper and acres of mud.
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