September 29, MLS Update

There were six new listings in the Zip Code, but none in the Meadows. Four homes in the Zip Code came back on the market, and one of those was a 3,000 s.f. home on Aspen Glen in the Meadows. It had been listed at $545,000.

 

There were many price reductions, and two were in the Meadows. One was the Aspen Glen home mentioned above, and it has been reduced to $500,000. The other reduction was an Alps Way home that has been reduced $10,000.

 

Four homes in the Zip Code went into Pending in the past 24 hours, and another four closed escrow but none were in the Meadows.

September 28 MLS Update

Normally, I do the update daily, except on weekends. On weekends I am really busy in real estate…showing homes or doing Open Houses…while at the same time the actual MLS activity drops off because other Realtors are also busy and do not do a lot of paperwork on weekends.

 

And, believe me. Listings and sales are paperwork intensive.

 

So, tonight, I will cover the past two days. There were 10 new listings but none in the Meadows.

 

That is important to me because I am the Meadows Caravan master this next month, and I need to collect three new listings for the Caravan. Just as a hint, I expect one of them to be my listing – a small home on more than 2 acres with privacy and view and a profitable avocado grove – under $600,000. Not a “short sale” or foreclosure.

 

There were four price reductions in the Meadows: a 4,000 s.f. home on Pinion Trail has been reduced to $632,000; a 2,800+ s.f. home on Alps Way is reduced to $659,900; a 4,700 s.f home on Sage Hill has been reduced to $749,000; and a 2,900 s.f. home on Mountain Meadows Rd. has been reduced to $775,000-$850,000.

 

Two Meadows homes in the Greystone area went into Pending, among 10 in the Zip Code. Characteristically, the Greystone homes that went into Pending were listed at $378,900 and $449,900.

 

Six homes closed escrow in the Zip Code but none were in the Meadows.

 

Federal Bailout

There is not sufficient information to properly analyze the Bailout, but that does not mean that we can’t discuss the general subject.

 

It is apparent that the final edition is better than what was proposed first, which was a Wall Street plum with sufficient pork to a particular segment of Special Interest Groups for the Democrats to jump on board.

 

The public screamed, so the pork was apparently reduced and a few safeguards were introduced to produce what can rightly be presented as a lipsticked pig to give the stock market a date for Monday.

 

Would the market have tanked? Who knows?

 

Markets are based on confidence, and confidence is impossible to predict.  It would have been an impossible situation, so I suppose doing something is better than doing nothing but the doing something did not include replacing Paulson, Cox, Frank, Dodd.

 

In the early 90s, I turned a computer company around for the federal Bankruptcy Court, and the second the Court released the company I resigned, saying to the President: “I can only do this once, but you will be back in bankruptcy because none of the top management has changed. Don’t call me again.”

 

Yes, they went into bankruptcy again. Managements do not change their style, but certain styles are more appropriate in different circumstances. There are probably 50 managers who could make this banking system whole, and none of them are part of the turnaround management package. The managers, and the overseers are all politicians who could not run a successful Dairy Queen, much less General Electric, and certainly not the national economy.

 

The names that brought us here, remain here. A new administration will permit changes but if you notice, new political administrations just bring in old political names.

 

The lawyers say “Hard cases make bad law” – and that is one thing I agree with them about: This is a hard case, and I suspect a bad law. Certainly one written hastily.

September 27 MLS Update

Here is the news. There were 17 homes that went into Pending in the Zip Code in the past 24 hours! Only one was in the Meadows. But any way you look at it, that was a BUSY SALES DAY!

 

(Still, only one was in the $400,000 range.)

 

Eleven new listings in the Zip Code but only one of those is in the Meadows. It is in the Greystone area, on Laurel Path. Almost 4,000 square feet for $575,000.

 

An additional four homes in the Zip Code came back on the market.

 

There were 13 price changes, of which three were in the Meadows.

NY Times Told on the Sub-Prime Culprit

If you believe that the New York Times is the Newspaper of Record, then it’s September 30, 1999 article points to the Genesis of the sub-prime meltdown, and it is, Bill Clinton:

(Quote) In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets — including the New York metropolitan region — will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

”Fannie Mae has expanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.” 

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.(UNQUOTE)

 

 

Bailout!

The sooner everyone realizes that the purpose of a home is to keep the rain off, the rattlesnakes away, and the sun from scorching the top of your head, the sooner all of the markets will recover.

 

 

We live Walter Middy lives in our minds, where we could play professional level sports, compete in F1 with the right car, and we would have gone to an elite Eastern college except our (brother)(mother)(father) got sick.

 

There are a very few first-rate economic minds, but those we have are not in Washington and are unlikely to be there because their minds work differently than being around political people.

 

My studies of WWII showed me that we won only because we made fewer mistakes than our enemies, and I now conclude that our economy is better than the rest of the world only because their economies are run from Paris, or London or Brussels with more mistakes than Washington makes, hard as that is to believe.

 

This entire crises was begun and fostered by selling homes to people who were never qualified to pay for them. When the smoke clears, we need to find out how that happened.

 

The economic crises was caused in Washington and on Wall Street – what makes us think either of them is the solution?

 

There are minds who can solve the problem – without concern for their political party: Jack Welsh, Warren Buffet, Bill Gates, Michael Dell, Mitt Romney…people who have demonstrated that they know how markets and industry work without printing money or demanding money from the taxpayers.

 

60 Day Analysis

Just looking at sales in the past 60 days, there have been 5 home sales in the Meadows and one in Rimrock. The most expensive Meadows home that closed escrow was $400,000, and the Rimrock home sold for $662,000.