Housing Bubble Bursting?

[Couch Potato]

Here is one Condo Converter who agrees a bubble has popped. He almost made it out of the country.

 

[Terrel L. Shields]

Fraud always accompanies a boom....

Looks like some investors will lose 100%.

Back in the old days I was an unsecured debtor for a company that owed me about $8,000 for consulting work..a month's worth. The son of the company owner was the largest secured debtor...his company was a "management co." owed millions on paper....The total assets left were $15,000 to split between a drilling contractor, dirt constractor, drill bit salesman, and about 10 consultants and/or bit contractors...my part was less than the cost of the stamp to mail a letter and claim it and the final deposition was in 1991...8 years after I did the work..Bankruptcy is a hoax and a joke and I have decided the Bankruptcy judges are about as crooked as the people filing this type action.

 

[Randolph Kinney]

Terrel, Ana Nicole Smith filed for bankruptcy after she lost in state court a claim on her late husband's estate. The bankruptcy court overruled the state court and awarded her a portion of the estate. The supreme court ruled bankruptcy courts do have superior authority over state courts in that matter. Strange but that is the way it is.

Fraud is a great business in boom or bust periods. It keeps lots of people busy. Legislatures pass more laws, judges make more rulings, lawyers get more money, people learn the hard way who to trust or how they should conduct themselves in a business matter.

 

[Ty Yu]

Housing Bubble Ends In 2006: Foreclosures Surge

Housing Bubble Evaluation: Heber, California

Looking at some obscure place like Heber (92249) located in California.
Before the Housing Bubble started in 2001, the comparable sales data shows many of the houses in the town of less then 3,000 people to sell for around $45,000. More then 22% of the population in Heber lives below the poverty line. Imperial County ranks among the highest in the United States for *unemployment* and is frequently #1 for *unemployment* in the State of California.

Today there are a couple of national builders selling houses in Heber for more then $300,000.

Question: What *method* did the real estate appraisers use in Imperial County California to go from around $45,000 to well over $300,000 for "comps" in a place where the median income is below $30,000 in a county that ranks number# 1 for unemployment in the state and has more then 20% of its population living below the poverty line?

The following links were used for information:

California Foreclosure Activity Highest Since 2001 / October 18, 2006
http://abclocal.go.com/kabc/story?section=local&id=4672943

Demographics for Heber, California
http://www.answers.com/heber, CA

Houses in Heber, CA: Over 300,000 U.S. Dollars in 2006
Loreto at Heberwood Estates in Heber California
http://www.centexhomes.com/San-Diego/N45928.asp
Hacienda at Sevilla in Heber California
http://www.drhorton.com/corp/GetCommunity.do?dv=Z2&pr=41981

Imperial County Ranks number one in unemployment again / Sept. 16, 2006
http://www.recordnet.com/apps/pbcs.dll/article?AID=/20060916/MONEY/609160314/1003

Poverty-Stricken in Imperial County: The Worst Median Income in the State of California / May 31, 2006
http://dwb.sacbee.com/content/business/story/14262284p-15075611c.html

Imperial County ranks number 3 in the United States of America for Unemployment: U.S. Census
http://www.census.gov/statab/ccdb/tst07040.txt

Imperial County, California - Demographics
http://www.knowledgerush.com/kr/encyclopedia/Imperial_County,_California/

Here are links to a couple of articles of interest relating to the topic of residential appraisals and *Artificial Equity*.

Appraiser sentenced in real-estate fraud
http://seattletimes.nwsource.com/html/localnews/2002223320_realestate29m.html

House Buyers: We Were Tricked Into Paying Too Much
http://www.theindychannel.com/call6/5430753/detail.html

 

[Randolph Kinney]

Ty, let me guess, Heber is a retirement community now?

I notice you have more than one national builder there. How many of those new homes are on the market for sale? How many are in some process of foreclosure?

 

[Steve Owen]

Aren't you supposed to use sales in the sales comparison approach? I'm talking about whole units of new construction, where the offering price is known. Add an attempted measurement of depreciation to adjust difference between subject & new construction alternative & apply a discount for asking price vs selling price, if the market shows the new alternatives sell for 95% of list plus the new car in the garage, for example.

Sorry, Roger. I must have mis-read your post. That's not a bad idea. We do something similar, but not very formally.

There is also a really good way to get depreciation from the market. But, you have to do it on a consistent basis. Every time you have a sale do a ca, but do an extra step at rcn... pull the depreciation from that specific sale. Eventually, you will have enough of them to have a good idea of depreciation for a lot of different houses in your market.

Anyway... back on topic...

http://www.kansascity.com/mld/kansascity/business/15783333.htm

Based on this... KC doesn't look too different from Joplin. Larger overall numbers, of course.

 

[Ty Yu]

Housing Bubble Fraud: Overvalued Property

[/QUOTE] I notice you have more than one national builder there. How many of those new homes are on the market for sale? How many are in some process of foreclosure? [/QUOTE]

The foreclosure stats are scary for Imperial County as *small* and poverty stricken as it is. As of Oct 19, 2006; 2,567 properties with *financial issues* are listed on foreclosure.com. If I guessed at how many properties went up during the *Housing Bubble* I would guess in the ballpark of 2,000
http://www.foreclosure.com/search/CA_025.html

Honestly speaking, I'm not sure how many are *currently* for sale. I can tell you that several streets are vacant with huge signs that read *Now Available* or *Now Renting*
Your post# 1733 was excellent. For any of you that missed Mr. Kinney's news story link here it is:

Housing slowdown creating 'ghost towns' / Oct 16, 2006
http://www.marketwatch.com/News/Sto...97D-951C-6E2D831096F4}&siteid=mktw&dist=nwhpm

I would have missed that story had you not posted it - thank you.

I don't see a whole lot retirement folks. What I do see are people taking houses and illegally turning them into *apartment complexes*. It would be typical in parts of Imperial County to see 5-8 cars parked for one home since most jobs in Imperial County don't pay a whole lot and many are seasonal.

 

[murray stroupe]

Strange number pattern im mr Kinneys newslink

Tu Yu/mr Kinney quote


Your post# 1733 was excellent. For any of you that missed Mr. Kinney's news story link here it is:

Housing slowdown creating 'ghost towns' / Oct 16, 2006
http://www.marketwatch.com/News/Sto...97D-951C-6E2D831096F4}&siteid=mktw&dist=nwhpm

I would have missed that story had you not posted it - thank you.

I don't see a whole lot retirement folks. What I do see are people taking houses and illegally turning them into *apartment complexes*. It would be typical in parts of Imperial County to see 5-8 cars parked for one home since most jobs in Imperial County don't pay a whole lot and many are seasonal.[/QUOTE]
=========================
Strange but repeating common number pattern;
80% town empty,20% full

 

[moh malekpour]

The number of Californians who are significantly behind on their mortgage payments and at risk of losing their homes to foreclosure more than doubled in the three months ended Sept. 30, providing the latest evidence of trouble in the housing market, figures released Wednesday show.

Lenders sent out 26,705 default notices — the first step toward a foreclosure — during the July-to-September period, up from 12,606 during the same quarter in 2005, according to DataQuick Information Systems

http://www.latimes.com/classified/r...0,4110776.story?page=1&coll=la-home-headlines

 

[Bobby Bucks]

Bankruptcy is a hoax and a joke and I have decided the Bankruptcy judges are about as crooked as the people filing this type action.

It certainly is when it comes to real estate development. When they go belly-up they’re accountable to no one in most instances. I was talking to a HVAC contractor who is Scottish and moved here a few years ago. He said one of the most shocking things in the US is how contractors can screw their subcontractors, file bankruptcy, keep most of their assets and start all over again with a clean slate.