I think the real estate market may have finally peaked

[The Bus]

I just got an email from a lender advising about certain "Soft Counties" where they would be especially stringent regarding appraisals, both for refinances and for people buying homes. In effect, if these additional guidelines would not be met, you can't borrow as much as you want.

These were the "Softest" counties in the US:

AZ: Maricopa, Mohave, Pima, Pinal, Yavapai
CA: Imperial, Monterey, Riverside, San Bernardino, San Joaquin
CO: Mesa
FL: Charlotte, Collier, Manatee, Miami-Dade, Sarasota, Volusia
MI: Genesee
NJ: Atlantic
NV: Carson City, Clark, Storey, Washoe
UT: Washington

The full list is a lot longer, and covers a LOT of counties in CA, FL, and NY (anything surrounding NYC, including Long Island).

[JimRochester]

A friend of mine here on LI is in the business and he says half of his deals are getting killed by the lender over appraisals. If thee is a property anywhere nearby with a low value it kills every appraisal for miles.

[al_bundy]

i was reading the fatwallet bubble thread and there are reports of banks selling off foreclosures for close to half off last year's prices in Woodbridge, VA. might have to look at moving there.

NY Newsday had a map of queens/brooklyn and LI subprime hotspots. as expected anything south of I-495 is worse than the north shore

i checked out the NYC public records and in my area prices are up around 20% or so YoY.

[DVD Josh]

Originally Posted by al_bundy

i was reading the fatwallet bubble thread and there are reports of banks selling off foreclosures for close to half off last year's prices in Woodbridge, VA. might have to look at moving there.

Woodbridge isn't too far from me. What it is too far from is a major city or reasonable traffic into it.

You come down here let me know, I'll take you out for some great BBQ in the area.

[kneijst1]

My inlaws live in Woodbridge... I'll have to check out FW site and see if they have links. It's new to my ear.

FYI, Woodbridge is out of the "DC metro" area a bit. They do have a Wegmans coming in though... (and a nice Costco). It's just a bit too far of a commute for me and the wifey.

Ah, just checked out FW. Here's a link to one of the houses that had a 61% price drop in over a year...

http://www.businessweek.com/the_thre...tudy_of_w.html

There is a reason that house sat the market so long, and it's NOT how a good representation of how the housing market is in DC. Most likely, the house has some kind of MAJOR issue(s). The information was orginally taken by a guy around here who does a website called NOVA housing bubble fallout... Definitely not a biased guy in the least...

[al_bundy]

http://novabubblefallout.blogspot.com/

[DVD Josh]

Originally Posted by kneijst1

My inlaws live in Woodbridge... I'll have to check out FW site and see if they have links. It's new to my ear.

FYI, Woodbridge is out of the "DC metro" area a bit. They do have a Wegmans coming in though... (and a nice Costco). It's just a bit too far of a commute for me and the wifey.

Ah, just checked out FW. Here's a link to one of the houses that had a 61% price drop in over a year...

http://www.businessweek.com/the_thre...tudy_of_w.html

There is a reason that house sat the market so long, and it's NOT how a good representation of how the housing market is in DC. Most likely, the house has some kind of MAJOR issue(s). The information was orginally taken by a guy around here who does a website called NOVA housing bubble fallout... Definitely not a biased guy in the least...

I read the thread at FW too, and those seem to be outliers. In fact, I just read an article that predicts a slight rebound in 2008 for NOVA and DC. Honestly, it wouldn't surprise me, with an election around the corner and likely dem gains.

[JimRochester]

After 34 pages isn't it time we started a new thread titled "I wonder if the real estate market has bottomed out yet?"

[grundle]

http://www.nytimes.com/2008/01/13/bu...in&oref=slogin

By TYLER COWEN

Published: January 13, 2008

IT’S NOT JUST THE LENDERS There has been plenty of talk about “predatory lending,” but “predatory borrowing” may have been the bigger problem.

As much as 70 percent of recent early payment defaults had fraudulent misrepresentations on their original loan applications, according to one recent study.

The research was done by BasePoint Analytics, which helps banks and lenders identify fraudulent transactions; the study looked at more than three million loans from 1997 to 2006, with a majority from 2005 to 2006.

Applications with misrepresentations were also five times as likely to go into default.

Many of the frauds were simple rather than ingenious. In some cases, borrowers who were asked to state their incomes just lied, sometimes reporting five times actual income; other borrowers falsified income documents by using computers. Too often, mortgage originators and middlemen looked the other way rather than slowing down the process or insisting on adequate documentation of income and assets. As long as housing prices kept rising, it didn’t seem to matter.

In other words, many of the people now losing their homes committed fraud. And when a mortgage goes into default in its first year, the chance is high that there was fraud in the initial application, especially because unemployment in general has been low during the last two years.

[ernestrp]

Originally Posted by grundle

http://www.nytimes.com/2008/01/13/bu...in&oref=slogin

By TYLER COWEN

Published: January 13, 2008

IT’S NOT JUST THE LENDERS There has been plenty of talk about “predatory lending,” but “predatory borrowing” may have been the bigger problem.

As much as 70 percent of recent early payment defaults had fraudulent misrepresentations on their original loan applications, according to one recent study.

The research was done by BasePoint Analytics, which helps banks and lenders identify fraudulent transactions; the study looked at more than three million loans from 1997 to 2006, with a majority from 2005 to 2006.

Applications with misrepresentations were also five times as likely to go into default.

Many of the frauds were simple rather than ingenious. In some cases, borrowers who were asked to state their incomes just lied, sometimes reporting five times actual income; other borrowers falsified income documents by using computers. Too often, mortgage originators and middlemen looked the other way rather than slowing down the process or insisting on adequate documentation of income and assets. As long as housing prices kept rising, it didn’t seem to matter.

In other words, many of the people now losing their homes committed fraud. And when a mortgage goes into default in its first year, the chance is high that there was fraud in the initial application, especially because unemployment in general has been low during the last two years.

Well, care to ad to the conversation or are you just padding your Dvdtalk account?

_______

[General Zod]

Obviously we need to follow Hillary's plan of over-taxing the rich to help out the liars.

[greg9x]

Wonder how many of those fraudulent buyers will get a bail out of some sort....

[VinVega]

Originally Posted by ernestrp

Well, care to ad to the conversation or are you just padding your Dvdtalk account?

Don't sell grundle short, he might write a wikipedia article about it.

In response to his article, I think it takes two to tango. There were predators on the lending side, just looking to make a quick buck and there were ignorant and even downright greedy borrowers on the other side looking to buy way more house than they could afford or looking to flip property with nothing down, a pretty risky proposition. I personally think they should all suck on it because that would bring housing prices back to normal for people who you know, need a roof over their head, not someone looking to flip property.

[VinVega]

Cripes, I just realized we're way over 800 posts. Closing for length. Please see Part II. Thanks.