Posted on June 16, 2008 @ 9:15 pm - Written by BawldGuy
Alas, the pics for this post are random at best, and totally discombobulating at worst. I’m just sayin’.
Wanna know something helpful about this real estate market correction? There are folks, who after observing several diverse markets have concluded something’s up. Up you say? Is my property gonna start goin’ up? Not so fast rose colored glasses breath.
Something is up alright. As regular readers know, this ain’t my first time in the theatre. I’ve seen this movie, and its sequels. I know the ending. Don’t know when it’s comin’ or how it arrives, but I do know the ending. Oh, get to the punch line? Sure.
The ending is when those seeing this sequel, thinking it’s the first time in history real estate has taken a powder, begin to think the ‘arrow on the chart’ only heads downward. Of course, it’s the same folks who thought a few years ago the ‘arrow’ only went up. Go figure.
Before continuing, let me warn you in plain English. Any serious attempt to time a market is foolish at the least, and courting tragic and unintended consequences at the worst.
Read the rest of this entry »
Posted on June 6, 2008 @ 11:48 pm - Written by BawldGuy
Warning: Pictures woven into this post are absolutely irrelevant to the text. Sometimes that’s just the way I roll.
The news on real estate varies from region to region, generating more opportunities for anyone with a keyboard to say ‘all real estate is local’ as if it was their original thought. It’s not secret Florida, Arizona, Nevada and California have been the hardest hit with this long lived market correction. The smart investors are, as quickly and efficiently as they can, taking their equity out of those states and into the regions showing solid strength — both currently and in the future. Arizona is the exception, long term to that statement, as they will, in my opinion, live up to their name when all of this has finished flushing through the system.
We’re currently taking clients to a handful of areas in Texas, while about to make judgments on three projects in Kansas City. Recently I had a pretty interesting conversation with an upcoming pro in a South Carolina city (Sorry, but stealth is required here.) which at least got me wanting another conversation. Haven’t heard from him since, but I’m sure he’s takin’ care of business. Also, have been intrigued by a small pocket in the Northwest, a region I’ve proactively ignored for years. Their numbers just haven’t measured up.
All this to make a point. Read the rest of this entry »
Posted on April 17, 2008 @ 10:11 pm - Written by BawldGuy
As promised, the subject will be subprime in general and scheduled loan resets i particular.
Yesterday I was able to view a chart (alas, unavailable) showing a very interesting chronology of these resets. It showed an clearly obvious peak. This peak was hit in Dec. ‘07/Jan ‘08 — then they dropped of into the black abyss — a 75-80% drop. Seriously. This level more or less remained until the 3rd to 4th quarter of next year. In other words, the tsunami of resets has already happened. The market now has well over a year, and possibly 18 months before the next wave (much smaller) hits.
There are folks for whom even these historically low interest rates don’t matter. In fact, if 0% was available they still couldn’t refinance. No equity is no equity no matter how you slice it. Then there are the borrowers who can use the next 12-18 months to refinance before their loan resets. Or they can sell. Some, because of the way their loans work will be able to just keep on keepin’ on, ‘cuz the reset won’t put them in the poor house.
The system is working. Property will change hands, and lessons will be learned. As more and more buyers cast themselves off the fence, this process will inevitably gain speed. Before we know it, the cycle will have begun anew. Is the system about to serve us all up a big juicy burger? Hhmmm.
Let’s cut through this whole Bull/Bear stuff, OK? Read the rest of this entry »