Archive for May, 2013

What happens when you give politicians $200 million with no accountability? They blow it. So it was with the money the City of Irvine extracted from developers to create the Great Park. So far, the City has brought in about $250 million, yet only about 15% of the park is developed, and what's out there doesn't look like $250 million worth of facilities. Most of the money was simply wasted. Irvine taxpayers paid for a park and all they got to show for it is a balloon, over-hyped and over-priced conceptual plans, and a giant pile of runway rubble. Dream Plan Tests Irvine, Calif., Again By ROBBIE WHELAN -- May 5, 2013, 8:25 p.m. ET For over a decade, city…[READ MORE]

Financial bubbles are inflated by investors who pile into an asset class with flawed assumptions. In most cases, these investors have unrealistic expectations for future appreciation and wouldn't want to own the asset based on its cashflow alone. Such is the case with stocks, bonds, land, houses, tulips, and even gold. At some point, investors question their original assumptions on appreciation and start to sell. Of course, this causes any appreciation to stop, and even more speculators decide to exit. Further selling causes prices to fall which prompts even more selling that culminates in complete market capitulation and a crash in market pricing. As surely as the sun rises and sets each day, once an asset class becomes coveted for…[READ MORE]

What would Jesus do if he were in charge of the GSEs? "And Jesus went into the temple of God, and cast out all of them who sold and bought in the temple, and overthrew the tables of the moneychangers, and the seats of them that sold doves, And said unto them, It is written, My house shall be called the house of prayer; but ye have made it a den of thieves."—Matthew 21:12-13 So what will Representative Mel Watt do if he is put in charge of the GSEs? Will he make it a den of thieves by reducing principal on mortgages for constituents on the political left? Will he overthrow the tables of the moneychangers and shut down the…[READ MORE]

The suppression of the housing inventory has resulted in some interesting home construction.  The lenders have suppressed many homes from entering the market place.  They have become shadow inventory and currently there are about 5 million of them.  Most media organizations have even lost interest in reporting these numbers. The lack of existing home inventory has generated a lot of demand even with a small pool of buyers.  Home builders have wasted no time to fill this void and started building more new homes.  Within this activity there is a much smaller subset of builders that are building homes without locking in home buyers during the pre-construction phase.  These homes are called speculation home building and it has reemerged in…[READ MORE]

  Sell your home with full-service agent representation at NO COST! OC Housing News and Akason Realty Consulting is changing the way people sell homes forever! We provide full-service agent representation with no listing-side fee! How Agent Commissions Work When a property is marketed for sale on the MLS, a fee is offered to agents if they bring buyers and part of the fee is paid to the agent marketing the home and representing the seller. Typically real estate fees range from 5-6% and are always negotiable, generally speaking 2.5%- 3% is offered to cooperating buyers agents with 2.5%-3% paid to the seller's agent for marketing, negotiating, and representing the seller. Some people try to sell their home without an…[READ MORE]

A pocket listing is a property kept off the MLS for exclusive showing to select buyers. Most often pocket listings are used by agents who want to double-end the deal and make double the commission. In that scenario, the agent is ignoring the inherent conflict of interest in dual agency to make more money. Typically, this arrangement favors the buyer over the seller. The buyer participates to get a good deal, the agent participates to get a double commission and a quick sale, and the seller... well, he gets screwed. Secret 'Pocket Listings' Return in Hot Housing Markets By CNNMoney | Posted May 2nd 2013 12:30PM The housing rebound has given new life to an old, but little-known sales practice…[READ MORE]

After 30 years of falling interest rates, Americans have become addicted to cheap credit and personal Ponzi schemes. People have learned they can take on large debts, consolidate them at lower and lower interest rates, and service that debt with a portion of their income. It's a bit like learning to live with a lamprey slowly sucking your financial juices. Often it's not enough to kill, so it's a parasite people learn to live with. Oftentimes when people get in trouble with debt, they stop using it. As Jesus would say, "sin no more." Through falling interest rates, loan consolidations, and other methods of "working with borrowers," lenders have learned out not to kill their hosts. Lenders have intentionally fostered…[READ MORE]

At this point we can be certain that banks are going to avoid or delay foreclosure or short sale until prices rise so they don't have to lose money on the sale. They have no choice. With banks still exposed to $1 trillion in unsecured mortgage debt, they simply can't take the losses that are coming. No matter what else happens in the market, unless the banks are forced to change their policies by the government regulators or the federal reserve (a very unlikely event), lenders will continue to kick the can with loan modifications and suspend homes in cloud inventory for as long as it takes. Since problems in the market cannot be resolved by lowering price, the inevitable…[READ MORE]

Monthly Housing Report

In Memoriam: Tony Bliss 1966-2012