MaxedOutMama
Tuesday, December 26, 2006
The Grinch Who Stole The Home Equity
This is what has worried me about homebuilder stocks. The Denver Post article points out the correlation between new developments, loans from homebuilder mortgage arms, and foreclosures. All over the country, I have found extremely dangerous loan programs being offered in conjunction with new housing:
The Housing Bubble Blog has excellent coverage; this aggregation of housing news from Massachusetts should be a reality check for those who believe that the worst is over. For most of the country, 2007 will be a much worse year for housing than 2006. In New Jersey, the pain is just beginning. Their worst problem is ridiculous property taxes.
I have a busy week, so don't look for timely stuff. Tomorrow we get the new homes report, on Thursday we get existing homes (a larger sample, so more indicative), and next week we get pending homes. Today crude oil and natural gas both fell, even though the news that the UN might be saying no to Iran caused an early rise. Gas prices in my area are up almost 20 cents from their low this year.
If you feel depressed, it might not be the economic news. It might be a virus; the flu is hitting the southeast hard. It seems to be causing a problem in kids in Alabama, so if your kids get sick get them to bed fast, and to the doctor if necessary. Ten critically ill kids from flu is unusual. I'm on the road this week, so I bought some Airborne today. It really does seem to help, and you can take it if you are around sick people at work.
A computer-assisted geographic analysis of Weld and metro-area foreclosures by The Denver Post found many concentrated in new neighborhoods developed by local builders. Others clustered in new neighborhoods where national builders doubled as lenders. In one, more than 90 percent of foreclosures on the original buyers involved loans from the builder.It's not just one builders. Most of them seem to have pushed sales using extremely creative financing. Spanish speakers seem to be targeted; we are getting reams of calls home in Spanish about homes and home loans (because of Chief No-Nag's last name). I strongly recommend this article in particular; it is very long and detailed. The valuation drops listed may eventually show up in many areas across the country in which a high percentage of new homes have been sold with non-traditional mortgages.
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Pay off your credit card bills. A 1.875 percent interest rate with a free washer, dryer and refrigerator. Win a 2007 Ford Escape!
These are some of the lures national builders dangled as the supply of unsold homes in metro Denver hit record levels this year.
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In a Northglenn neighborhood built by KB Home, 56 of the original buyers have been foreclosed. Fifty-one, or 91 percent, got their loans from KB's mortgage company.
The Housing Bubble Blog has excellent coverage; this aggregation of housing news from Massachusetts should be a reality check for those who believe that the worst is over. For most of the country, 2007 will be a much worse year for housing than 2006. In New Jersey, the pain is just beginning. Their worst problem is ridiculous property taxes.
I have a busy week, so don't look for timely stuff. Tomorrow we get the new homes report, on Thursday we get existing homes (a larger sample, so more indicative), and next week we get pending homes. Today crude oil and natural gas both fell, even though the news that the UN might be saying no to Iran caused an early rise. Gas prices in my area are up almost 20 cents from their low this year.
If you feel depressed, it might not be the economic news. It might be a virus; the flu is hitting the southeast hard. It seems to be causing a problem in kids in Alabama, so if your kids get sick get them to bed fast, and to the doctor if necessary. Ten critically ill kids from flu is unusual. I'm on the road this week, so I bought some Airborne today. It really does seem to help, and you can take it if you are around sick people at work.
