BREA

Below-median home inventories may not recover for years

 BREA, NEWS
Oct 182012
 
Below-median home inventories may not recover for years

For home inventories to recover, sellers must come back to the market. Since so many loanowners are underwater, particularly at lower price points, very few organic sales occur on below-median properties. Further, since below-median loanowners have a strong incentive to squat until foreclosure, few of these properties are coming to market as short sales. That leaves us with a depleted market that is only be replenished by foreclosures. And as I noted on Monday’s post MLS inventory is NOT coming as foreclosure filings dry up, banks are in no hurry to process foreclosures and bring these properties to the MLS. [Read More...]

As lenders withhold product, the homebuilders will flourish

 BREA, NEWS
Apr 272012
 
As lenders withhold product, the homebuilders will flourish

Anyone who watches the market carefully knows that lenders are withholding supply to cause prices to bottom. This is in the best interest of the members of the banking cartel. It’s surprising to me they managed to pull it off. Cartels are inherently unstable, most often because each member has a strong incentive to cheat by increase supply to take advantage of the improved pricing. In my opinion, that is what will likely cause the engineered spring rally of 2012 to fail. Calculated Risk famously described the problem facing homebuilders in the wake of the housing collapse in his analysis [Read More...]

Grifters for God: fraudulently occupying a $1.3M home for five years

 BREA, NEWS
Mar 062012
 
Grifters for God: fraudulently occupying a $1.3M home for five years

One of the cartoons I post when appropriate is called the National Squatters Entitlement. It speaks to a truth about people’s attitudes toward home ownership. People convince themselves they own property even if they have no equity claim. Their names may be on title, but all they really own is their loan. I discussed this at length in Money rentership: housing and the new American dream: The mortgage encumbrance gets to the core of the unnoticed change in people’s concept of property ownership; people who have little or no equity stake in a property have no ownership despite what legal [Read More...]

More proposals to fix the housing market

 BREA, NEWS
Feb 032012
 
More proposals to fix the housing market

There is a consensus that something needs to be done to fix the US Housing market. Of course, this consensus opinion is wrong, but everyone seems to have their pet idea on what form of market manipulation will produce a desired outcome — ostensibly to reflate the housing bubble. I argue the pundits are trying to solve a problem that doesn’t exist. Sure banks, loan owners and true owners of real estate want to see prices stablize and go up because they want money. For them the current state of the housing market is a problem, but is it really [Read More...]

Attention Irvine home owners: your Mello Roos are no longer tax deductible

 BREA, NEWS
Jan 262012
 
Attention Irvine home owners: your Mello Roos are no longer tax deductible

What is a Mello Roos tax? The Community Facilities District Act (more commonly known as Mello-Roos) was a law enacted by the California State Legislature in 1982. The name Mello-Roos comes from its co-authors, Senator Henry J. Mello (D-Watsonville) and Assemblyman Mike Roos (D-Los Angeles). The Act enabled “Community Facilities Districts” (CFDs) to be established by local government agencies as a means of obtaining community funding. When California Proposition 13 passed in 1978, it restricted the ability of local governments to raise property taxes by more than an inflation factor. The budget for services and for the construction of public [Read More...]