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Like I said on the last thread, there was deal BofA was giving to all Physicians in CA:
0 to 5 Percent Down at as low as 5.5 Percent, plus waiving the PMI.
That deal ended March 31st, so look out at the high end.
¿owau
Couldn't green shoots be used in lieu of bamboo, if one wanted to torture the hoi polloi with ficticious fabrications of failed sales?
...never mind...
Home sales in Southern California increased again last month, led by strong foreclosure resale activity in the Inland Empire. ...
Amazing how markets clear and begin to function properly when the government doesn't interfere with them to stop corrections for political gains.
If only we'd let this happen with the markets in 1998...
What could have been.
I guess those getting FHA loans are ignoring that they are participating in SOCIALISM!
I don't much care what it is called, but at least these new mortgages aren't going to be securitized as CDOs with CDS non-insurance insurance.
Note to HB's: the market can stay rational longer than you can stay solvent.
New definition:
"So-Calism" the belief that society is best served by buying houses @ 12 times their annual earnings.
http://www.youtube.com/watch?v=2XVR9AKZOu4
Take a much needed financial break and watch Susan Boyle sing 'I Had A Dream' from Les Miserables. She is the sure winner of Britain's Got Talent 2009.
Stunning jaw dropping fantastic!
"Amazing how markets clear and begin to function properly when the government doesn't interfere with them to stop corrections for political gains.
If only we'd let this happen with the markets in 1998... What could have been."
?
??
???
Lack of government interference?
That's how you see this?
Wow. Guess we're different that way.
Make that 'I Dreamed a Dream' from Les Miserables...
"CalculatedRisk (member) wrote on Wed, 04/15/2009 - 10:41am.
Nemo, I think "green shoots" is the wrong analogy. I don't think we are going to see much growth - just the end of cliff diving. That will help - less subtraction from the economy, but no engine for growth."
Basically, the beginning of the "L" shaped recovery is here!!!!!
All this tells us is that once banks actually get around to putting the house on the market, they generally do a good job of finding the market clearing price. The gross number of sales is generally a meaningless figure these days- the number of sales will be whatever it needs to be to clear out the must sell inventory on the market.
I think the more meaningful stats are the number of actual foreclosures (hence the level of must sell inventory coming on the market) and case-shiller figures on the middle to high end of the market (showing if there is any price stabilty for homes above the entry level)
FFDIC,
Fine tune, impressive lady.
.............................
If you don't take your profits, someone else will.
CR,
The problem with believing that a few bits of less negative news herald the end of the worst is quite simple... namely-
The assumptions that underlay our current system are visibly broken.
How do you think any of this news addresses
1. layoffs and their effect on the average persons psyche
2. consumer psychology
3. wage declines
4. local government spending patterns
5. state and federal government spending patterns
6. demographic profile changes
7. the byzantine nature of our legal and tax system
8. A medical system that delivers decreasing care for more money
9. pensions.. and income stability
I feel that this system cannot be successfully patched..
I guess those getting FHA loans are ignoring that they are participating in SOCIALISM!
I don't much care what it is called, but at least these new mortgages aren't going to be securitized as CDOs with CDS non-insurance insurance.
Actually the recent problems in mortgages and finance and the problems with socialism and excessive government spending have the same underlying cause:
People and institutions don't act responsibly when spending other people's money.
If you think about it the whole massive expansion in credit as well as the structure of the hedge fund industry allowed people to participate in the markets without risking their own money; hence all the crazy behavior. Free markets function well when people are risking their own skin, not so much when they're risking other people's skin.
But this is precisely the same problem that plagues government spending:
It tends to be implemented relatively inefficiently because the government is spending other people's money and lacks the incentive to manage it as a person would manage their own wealth.
Credit bubbles and excessive government spending suffer from the same core defect, which makes it a concern if we propose to "fix" one with the other.
Government- insured, FHA mortgages made up 37.8 percent of all purchase loans in March, up slightly from a revised 37.5% in February and up from 10.1% in March last year.
So approximately 40% of all loans were of a variety that only requires 3.5% down. In terms of significance, that 3.5% is a rounding error, when factoring in other costs, such as realtor's fees. So even with interest rates at historic lows, and prices that are down -- in some cases -- 50% or more from their peak, we are still creating a healthy supply of foreclosures for years to come. Dow 36,000, anyone?
Socal numbers (Jan - March) are interesting - coastal areas are out performing inland areas:
LA
J - 300K
F - 299K
M - 300K
OC
J - 370K
F - 375K
M - 390K
SD
J - 280K
F - 285K
M - 285K
Riverside
J - 195K
F - 190K
M - 187K
San Birddo
J - 162K
F - 153K
M - 150K
So basically coastal areas are showing a seasonal bounce (they didnt last year), while the inland areas continue to cliff dive. Interesting...
"Nemo, I think "green shoots" is the wrong analogy. I don't think we are going to see much growth - just the end of cliff diving. That will help - less subtraction from the economy, but no engine for growth" (CR said)
I couldn't agree more!
How can we have a functional democracy when we appoint drug 'czars', technology 'czars'...
'Czar' is the slavic version of Caesar.. Do you really want a Caesar in a Republic? The Roman Republic was corrupt, rigid and dysfunctional when Julius Caeser came along.
MM wrote on Wed, 04/15/2009 - 1:52pm.
Basically, the beginning of the "L" shaped recovery is here!!!!!
Well the credit panic is over. Now the flaming wreck of the global economy falls on us. If that is "L-shaped", sure.
Who could resist the charms of the Inland Empire, and it's hot as hades lifestyle?
Lack of government interference?
That's how you see this?
Wow. Guess we're different that way.
The government aggressively intervened in the markets and financial system in 1998. They admit to doing this ("It had to be done!"), it's not a question of whether it happened but what were the consequences.
The consequences I see are that they revived the hedge fund industry that was beginning to come apart and halted an asset price correction in progress and sent stocks right back on a course for the moon along with the debt driving these price increases.
What good did this do us?
PS> Real Estate Agents as well as Builders were informing potential CA clients of BofA's Physician Jumbo Loan Program, and said it was driving high end CA sales in late March, temporarily supporting prices by causing a dip in inventory as REO's were kept off the market. No wonder the deal ended at the end of March, just when the banks began resuming forclosures.
MM
+1
Lack of government interference?
That's how you see this?
Wow. Guess we're different that way.
Oh, and if I misinterpreted you and you're referring to the current situation, let me change my wording:
"Lack of sufficient government interference to halt market forces."
Clearly a departure from 1998 even if it wasn't intentional.
poppycock.
Food, guns, and ammo......AND squirrels are going to be in boom times for a decade at least.
Here comes the sun....
That's because the inland areas had the largest price declines first so people who would rather have bought in costal areas did the inferior goods switch-er-oo. Now that the coastal areas are beginning to feel the downward pressure, they will suck the remaining buyers away from the inland. And thus begins the next leg down...
AC,
I think I misunderstood you.
You're not saying the current period displays a lack of government interence, are you?
Rather, that government interference is inefficient?
Or am I again misunderstanding you.
"Sales are being driven by foreclosure resales (55.4% of all sales)"
nothing like creating the next level of bag-holders.....
Ciao
MS
Should be more foreclosures coming if WSJ/CR story is right. Investors are finding bargains, this has little to do with a real and sustainable housing market. However, it is the first necessary step.
Why is a foreclosure called a "resale" if nobody really ends up occupying it, and it just sits forlorn?
Another turning point this weekend?
http://www.moneyweek.com/news-and-charts/a-forecaster-you-cant-afford-to...
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How can a system that is optimized for short term shareholder gain ever create more jobs if the overall market is shrinking?
Think about it- The system worked for so long only because the market size was increasing.. the current shareholder-biased system cannot work unless there is a continuous increase in market size.
SoCal is heavily dependent on industries that require a lot of growth and short term shareholder gain.. If the engine cuts, even a 0% mortgage won't help.
AC,
I think I misunderstood you.
You're not saying the current period displays a lack of government interence, are you?
Rather, that government interference is inefficient?
Or am I again misunderstanding you.
Yeah, I'm just saying the government interference this time around didn't fundamentally reverse market forces as it did in 1998, so the market is beginning to clear and return to something sustainable.
oh come on, AC:
People and institutions don't act responsibly when spending other people's money.
If you think about it the whole massive expansion in credit as well as the structure of the hedge fund industry allowed people to participate in the markets without risking their own money; hence all the crazy behavior. Free markets function well when people are risking their own skin, not so much when they're risking other people's skin.
How responsibly have those foreclosed upon acted?
When a 401k investor puts money in a mutual fund, their risking their skin, but the guys investing that money are not. But the investor still loses.
Acting responsibly with money, your own or somebody elses, is a moral/ethical quality. Ever hear of fiduciary responsibility?
Interesting, lots of refi' for mtg but not a lot of C&I leanding going on:
Treasury: bank lending declined in February despite billions of dollars in government support
Martin Crutsinger, AP Economics Writer
Wednesday April 15, 2009, 1:28 pm EDT
WASHINGTON (AP) -- Bank lending to consumers and businesses for many types of loans fell in February despite the billions of dollars in government support the banks received.
The Treasury Department said Wednesday its latest monthly survey of lending activities at the nation's biggest banks showed nine reported increases and 12 posted declines. The median, or midpoint, for lending activity dipped 2.2 percent in February.
While the median level of activity in mortgage lending rose 35.4 percent and home equity lines of credit grew 17.7 percent, lending to businesses for commercial and industrial loans plunged 47 percent.
"Against a difficult economic backdrop, banks extended approximately the same level of loan originations in February as January," the Treasury report said. "The relatively steady overall lending levels observed in February likely would have been lower absent the capital provided by Treasury."
The findings on loan levels were based on reports filed by the top 21 recipients of rescue money from the government's $700 billion bailout fund.
Critics of the rescue effort have complained the government has not done enough to ensure that the money banks receive is being used for its intended purposes -- to resume more normal lending to businesses and consumers.
Full Stop wrote on Wed, 04/15/2009 - 1:03pm.
MM
+1
I second. L shape 'recovery' is the new paradigm.
Had conversations today with a number of biz buds... it surprises me how few of them understand the c-change that has occurred. I tell them they have to adjust to a 'low cost mode' and not be pushing 'growth at any cost'... pushing growth at any cost will burn up resources needed to keep the organization alive through this period. They all look at me like I'm a traitor or heretic.
The San Jose Mercury News on the front page of their business section cited declining foreclosure sales in California (although it did not break out Southern California). The article claims sales of foreclosures dropped 41% from the previous month and 36% from the previous year for the State. But NOD increased to a record of 54,268 in March up 30% from February.
Dave in SV
"Investors are finding bargains"
Today's "bargain" is next year's "what the hell was I thinking?" and 2011s second foreclosure sale on the same home in 3 years.
Green shoots abound
- Nemo