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Meet Janet Faello (and pop a Zoloft): The 53-year-old divorcee with two daughters in college has been trying since May 2007 to sell her and her ex's Long Island 6-bedroom home. Her initial asking price was $829,000, then $750,000, now $699,000. Care to guess how many offers she's gotten? If you said anything more than zero, you're not depressed enough. Faello, whose experience is emblematic of the current housing implosion, is stuck in the home, surrounded by memories of her failed marriage and steep property taxes. She tells the Times, "I’m not ashamed to say to you, I have had to borrow money from my father." The article paints a bleak portrait of NYC suburbanites who feel like hostages in homes they can't sell. Pending home sales in the Northeast fell 14.5% from December 2007 to December 2008, and are not expected to "hit rock bottom" for at least another year. As one frustrated Connecticut home seller puts it, "Sometimes dreams just blow away." For further reading, curl up with a bottle of pills and George Packer's disturbing article about Florida's housing apocalypse.
Economic Deathspin: Would-Be Home Sellers Feel Trapped
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Another case of sudden jihad:
http://www.nypost.com/p/news/local/student_kills_prof_nGgR2x0Omat9UDx4
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The problem is, the fucking banks aren't loaning any money to anyone.
not necessarily the whole problem, but a large part of it. we're bailing a lot of banks out, but they aren't using that to ensure a credible credit market
It's not that the banks aren't loaning money, its the fact that house should have never been worth over three quarters of a million dollars in the first place.
People will 'yeah yeah' that off and counterpoint with the fact that we're in the NYC metro area and supposedly there so much more money around here, but this doesn't discount the fact that here, like many other places around the country experienced the same decoupling between average incomes and housing values over the first half of this decade and it's going to take probably the better part of the next decade for us to normalize again.
This shit aint going away in a year.
Why would a bank lend into a collapsing asset valuation? In a sense, they are protecting homebuyers by waiting out the fall in prices so their mortgage customer isn't underwater from Day One. Not only are sellers unrealistic about the prices they might get, but buyers as well believe that the current market is full of bargains. It's not. Homes that cost $100-200 per sq. ft. to build but sell for over $500 per sq. ft.are not bargains. When we are at 1995 levels we will see the housing market move.
Not entirely true, but even it was that's great news.
We need a nation of savers who don't need interest only loans to buy a house. We need to get back to loan officers actually making sure you have $30,000 in savings for a down payment and making sure you have a job.
Ultimately, reducing retail lending will lead to lower housing prices. This is another great effect. Housing became too expensive and priced out everyone. It sucks if you re-fi'd or took our too much equity---but it's an important lesson to learn: A home is an asset, not an investment. Like any asset, it could appreciate in value based on scarcity/supply and demand, or depreciate for the very same reasons.
Everyone is trapped, everything is on hold just be greatful you have a house. I'm trapped in my fucking nightmare of a job. Sure, I die a little inside everyday but i'm lucky to not be unemployed.
"Sometimes dreams just blow away."
And sometimes opportunity knocks. I'm looking forward to buying something when the market bottoms out. Desperate sellers make me smile.
The most important part of the article isn't in the testimonials but this line: "Sellers remember what neighbors sold their houses for two years ago and hold on to those unrealistic comparables. They need to accept the current reality of the market."
You'll be happier if you stop trying to keep up with the Joneses and live within your means. Hopefully people are starting to remember this.
Prices still have to drop about 25% or more in NYC and some surrounding suburbs in order for them to become affordable to middle-class New Yorkers. I just don't see that happening.
Exactly. Don't buy something you can't afford, don't try to "time the market", don't use your house as an ATM.
SNL Skit: "Don't Buy Stuff You Cannot Afford"
'OBAMA'S PROGRAM for FORECLOSURES'
Some amazing 'SPIN' going on here in PREZ BARACH'incurably-dishonest'OBAMA'S so-called plan to prevent foreclosures - which it won't and can't!!! . Yes, $75BILLION DOLLARS sounds like a lotta money. Until you realize we have 9MILLION homes in 'foreclosure' or about to be. Most of them should have never got legitimate loans in the first place. SO NOW DIVIDE THE 9M HOMES INTO $75B and presto you get $8000+ FOR EVERY MORTGAGE HOLDER!!! Not very much help is it??? WAKE-UP PEOPLE THIS IS NOT TO HELP HARD-WORKING PEOPLE - IT IS TO SUBSIDIZE SUB-STANDARD MORTGAGE HOLDERS 'SKATE' THROUGH THE MESS THE GOVERNMENT CAUSED BY GIVING THEM LOANS THEY DIDN'T QUALIFY FOR AT THE OUTSET!!! Another PREZ OBAMA PLAN - doomed to failure because it only benefits, slightly if at all, the very lowest of our society. DID THIS GUY REALLY GO TO HARVARD OR DID HE TAKE 'EXTENSION COURSES' BECAUSE HE KNOWS NOTHING AFTER ONLY 30 DAYS. More like the 'visions' of some of the DOOBIE SMOKIN F^^KN NUTTERS who used to hang-out in HARVARD or CENTRAL SQUARE!!!
You're ill.
That he is...
Hugo Mego, right?
The issue here is not that she CAN"T sell the house, it's that she WON'T sell the house -- at least for the price that it's actually worth in this market. Anything will sell at the right price.
She should take the cost of the taxes for a few years and deduct it from the price of the house and see what happens. If she acts as her own broker or defines contingencies with a broker, she is not forced to accept any offer.
There's a time to cut your losses and move on with your life.
Gee, in any world except bizarro world of LI, NYC, Westchester, and NJ metro, this house would be 300K tops. What would it cost to rebuild, and add another 40K for the lot. There's your price. Get it to that point and it will sell,and get the mortgage to no more than 3x the buyers income with 20% down and banks will lend. Enough is enough of this bizarro price crap. I feel nothing at all for these greed-meisters trying to keep up the inflated values to levels that result in these property tax prices and insane mortgages that no-one can afford. Reality sucks to the greedy.
Agreed, at $300K this thing probably sells. If you're desperate, but $300K is not enough money for you, than tough sh*t. That's more than 3 times this country's average net worth. Maybe not a good measuring stick, but still - you're MUCH better off than the average American so it can't be that bad.