We get the CNN-Money annual survey of the most overvalued & undervalued housing markets, and find Bend is #1, with an "adjusted" overvaluation (adjusted given the CNN-Money median is too low) of almost 100%. If you back out "fair value", you see that CNN-Money infers that homes in Bend should have medians closer to $180,000.
How did we get here? It was several things: Vast numbers of immi-Cali-grants bringing tremendous piles of equity here. The national bubble-nomics of easy money. Tremendous marketing efforts. A speculative mindset that seems to have infested and then consumed what is our largest industry.
I began keeping a little diary in mid 1999 regarding what I thought was an insane appreciation and valuation level in the stock markets. So I thought I would look back over recent history, and chronicle some of what has happened to bring us to this point. But I thought I would do it a little different, and track some individual people, events and themes.
NORMA DUBOIS:
Less Is More - Nov 15, 2005
"On the other hand, buying a smaller house may be the only way for some to afford space in the red-hot neighborhoods near Bend's downtown and the river, Coldwell Banker Morris Real Estate broker Norma Dubois noted."
Sky's The Limit? - Jan 11, 2006
"I think we are certainly going to continue to see growth, and we'll continue to sell a lot of inventory," Coldwell Banker Morris Real Estate broker Norma DuBois said Tuesday. "The units sold will be at least what we did in '05 and probably greater, but I don't think the average price will increase like it did last year. I'm guessing we're going to go down to the 10 (percent) to 11 percent range."
"On Bend's northwest side, 236 empty lots of one acre or less sold for a median price of $245,000, DuBois said, up 54 percent."
Buyers compete for Bend condos - April 26, 2006
"Realtors opened seven luxury condos on the fifth floor of the new Franklin Crossing building at Bond Street and Franklin Avenue for "reservations" last week.
Six of the seven drew offers at the asking price before the reservation period ended last Friday, Coldwell Banker Morris Real Estate broker Norma DuBois said. Five drew multiple bids, which prompted a follow-up bidding period. The competition may bump the prices up even further."
"The reservation period was offered only to a "priority list" of potential clients who had expressed interest in the project, DuBois said.The bids came from a mix of buyers, DuBois said, including some local people who intend to live there full time, along with others who intend to use them only as second homes, and still others who intend to rent them out."
"The Franklin Crossing building, in particular, with its ground- and second-floor retail, third- and fourth-floor offices and upstairs condos "has a penthouse feel," DuBois said. "There is a real feeling of uniqueness to it."
Apartments to Condos - July 23, 2006
"The median price of a single-family home in Bend's least-expensive quarter, the northeast, stood at $285,000 at the end of the first quarter this year, according to Bend Realtor Norma DuBois' analysis. The median in the city's priciest area, the northwest quarter, topped $477,000."
More Homes on Market in Region - August 11, 2006
"Anecdotally, Coldwell Banker-Morris broker Norma DuBois said the agents in her office have seen an uptick in prospective buyers in the last couple of weeks, while the flood of homes entering the market seems to have slowed.
Sellers will have to price their homes below the market and bring them on in pristine condition if they expect quick sales in the near future, at least until some of the excess inventory clears away, DuBois said, but she expects flattening mortgage interest rates and the area's still-strong attractions to buttress the market before the year is out.
"I think we've hit the bottom and we're on our way back up," she said."
Condo market key to penciling out projects - February 25, 2007
"But, given the high prices for downtown land and the high price of construction, their economic viability may depend on a single factor — the health of the residential condominium market.
The reason: Selling parts of a building to condo dwellers is the only way, in most cases, to offset initial building costs to the point where ground-floor retail and midfloor office leases can generate a profitable income stream.
In other words, as Bend Realtor Norma DuBois puts it, “It’s the only way you can make it pencil.”
So how is the market for urban condos — a relatively new market for Bend and Central Oregon — holding up?
Results, so far, seem to be mixed.
In Franklin Crossing at the corner of Franklin and Bond — the downtown’s first new five-story mixed-use building — buyers lined up to snap up reservations on the buildings eight top-floor condominium units last spring, despite prices that ranged over $1 million, DuBois said.
But the market changed over the summer, and so did Franklin Crossing’s fate.
Reserved buyers melted away from five of the building’s eight units by the end of 2006, DuBois said, leaving only three sold so far. The remaining five units, priced between $450,000 and $1.1 million, account for about $3.25 million in inventory at current listing prices.
Whether the pace will pick up, DuBois said, is anyone’s guess. Bend’s housing market has gone flat, along with most of the nation’s, but downtown properties here, as elsewhere, are in locations that tend to give them the ability to create markets of their own."
Bend tops home appreciation list - March 2, 2007
"Take away the spike of activity from the 2004 through mid-2006 boom, and Bend's sales activity and price growth are about in line with the trends of the past 10 years, Coldwell Banker Morris broker Norma DuBois said.
It may take a year to work off the inventory glut that was left from the boom months, DuBois estimated, but after that "I'm really optimistic. I think we're going to see a nice, steady pace. We're not going to see another spike like we did recently. If we do, I'd say it's going to be at least 10 years out."
BECKY BREEZE:
Condo-mania - October 23, 2005
"Add stainless steel appliances, wood floors and cabinets, granite countertops and buyers can expect prices in the neighborhood of $400 per square foot, Swan confirmed.
Local real estate agent Becky Breeze and her husband are building a 42-unit condominium project in the Old Mill District. Breeze already has sold most of her units. She said buyers know what they want and they don't balk at prices.
"They want to live in a custom home," Breeze said. "And they don't want to sacrifice quality. They want to be close to walking trails and the mountains. They're really mobile and they have a lot of money," she said."
In Bend, home sales slump - May 7, 2006
"Some market observers say the dip in Bend's March and April sales was just a short-term lull.
Multiple offers on homes, especially in the lower $300,000 to $500,000 range, have become common again the past 10 days as the weather has warmed and worries over rising interest rates have eased, Becky Breeze & Co. broker Becky Breeze said Thursday.
Breeze, a 17-year veteran of Central Oregon real estate sales, said she thinks the sales pace this summer will again rival the record-setting pace of 2005, stoked by buyers from more expensive, more crowded areas.
"When people sell things in California, Seattle or Portland, when they come to Bend they are always pleased with the quality of homes we are building. And they also love that our prices are still very reasonable in their minds," Breeze said."
Condo market key to penciling out projects - February 25, 2007
"A few blocks away above the Old Mill’s retail district, The Plaza, a purely residential condominium project, has moved 12 of its 42 units so far, owner and Realtor Becky Breeze said, at prices ranging from around $600,000 to nearly $2 million, although the building won’t be move-in ready until June."
THE BIG SCREW YOU:
Condo project riles neighbors - February 7, 2007
Mountain Gate:
"The developers say Mountain Gate Crossing, with its vision of 134 condos, ski chalet facades and ground-floor businesses, will be a new jewel along the road to Mount Bachelor.
But to the neighbors who live in the quiet suburban tracts next to it, other terms come to mind.
"Some projects are just wrong," River Bluff Trail resident Jeff Payne wrote to city planners last month, one of more than 90 letters of opposition the project has drawn so far.
"Not a sensible development," Brookside Loop resident Kristine Finfer huffed.
"This project is off-the-wall," Sunrise Village resident Larry Harrell chimed in. "This project is out of character with the west side of Bend and more fits the character of Redmond."
"The Mormon church, the RV Park, the combination roller hockey and ice hockey complex - none "fit the neighborhood," Evert said, until the city's codes changed enough to allow AWBG's condo plan."
"For years, housing could be built on commercially zoned land only as a conditional use - a designation that required the developer to jump through several specific hoops to gain approval, Sen-ior Planner Wendy Robinson said.
Planners removed that requirement when they rewrote the codes last year. They hoped to encourage mixed-use and planned developments with a few houses more closely mingled with shops and offices, Robinson said. But they didn't intend to open the gates for developments on commercial lands that included mostly residential condos, even though nothing in the current code specifies the amount of commercial that has to be included in a "mixed-use" development.
"It's one of those unintended consequences," Robinson said. "I don't think we anticipated anyone purchasing commercial land at commercial prices to develop residential housing on it."
From farmland to subdivision - April 7, 2007
The Measure 37 Tango:
"Aside from the neighbor-to-neighbor disputes that have flared up across the state, putting subdivisions in rural areas may cause other problems, some officials say. In Redmond's case, the city's water mains and roads are not designed to accommodate large developments outside of its limits, Public Works Director Chris Doty said.
"We're concerned with Measure 37's ramifications on city infrastructure because it basically focuses intense development in rural areas that come into the city and utilize capacity in our system," Doty said.
He added that Arnett's claim would have a relatively minor impact, but that it highlights the issue nonetheless.
Though he sees himself as an entrepreneur who has bought and sold a number of nursing homes across Central and Eastern Oregon, Arnett doesn't want to be painted as another money-hungry landowner.
Growth is all but natural, he points out: Redmond's population now is about the same as Bend's was when he first moved to the region.
"I don't want people to think, 'Oh, they're tearing up a beautiful old ranch out there in order to build more houses,'" he said."
Resort traffic has Redmond worried - March 18, 2007
The Destination Resort Shuffle:
"Redmond officials contend that people will come to their city to shop at places like Wal-Mart and Fred Meyer, since there are fewer options in Prineville. And for that extra traffic, Redmond wants money."
"By Redmond's calculations, if just Remington Ranch were located inside city limits and had to pay the city's rate for transportation system development charges that amount would total more than $860,000, assuming 300 peak rush-hour vehicle trips."
"Remington Ranch Project Manager Chris Pippin disagreed that his resort would have as much of an impact as Redmond claims.
"We are in a unique location such that our traffic basically impacts state highway facilities," Pippin said. "We basically do not touch a Crook County road or for that matter a city of Redmond road at all."
"Pippin said Remington Ranch has agreed to pay what may end up being several hundred thousand dollars to ODOT to offset some of the improvement costs. That money would go toward a Powell Butte Highway interchange and the Southwest Veterans Way-Highway 126 junction. In a letter from ODOT included in the records for Remington Ranch, the agency calculated that the resort could have to contribute a total of nearly $1 million toward those two intersections and the O'Neil Junction on the north end of Redmond. Brasada Ranch has already paid for a left-turn lane at the Powell Butte Highway and Highway 126 intersection.
But that's not enough, Doty said.
"It's a drop in the bucket as far as we're concerned," he said."
"But Brian Bergler, a spokes-man for Pahlisch Homes, the developer of Hidden Canyon, pointed out that the resort will be paying far more than anyone else has to improve roads near its future resort.
"(We) will be paying over $4 million for road mitigation improvements, and that is in a combination of (money for) ODOT, Crook County and Deschutes County," he said."
"If we go down this road, where do we stop?" Cooper asked. "Do I extract concessions from destination resorts to improve state highways in Portland?"
Apartments to condos - July 23, 2006
Get Rich, or Get Out:
"Sarah Hendriks is 20 years old and eight months pregnant.
A few weeks ago, the owners of her apartment building, the Monterey Pines in west Bend, informed her that her four-bedroom apartment will soon be converted to a condominium.
The good news is the price tag. For a little more than $300,000 - at least $177,000 less than the median price of a stand-alone home in the northwest quarter of Bend this year - Hendriks and her boyfriend could own their own home.
The bad news: They still can't afford it. So the conversion, for them, means another foray into a tight and increasingly expensive rental market to look for a new home.
"Everything in Bend - everything - is so expensive," Hendriks said Tuesday. "It just makes it hard for us young people to make a living."
That may be true, but the developers, real estate brokers and property owners who are driving one of Bend's newest property trends say they will ultimately create lower-cost ownership opportunities for middle-class home buyers, while they find a new way to turn profits for themselves in a real estate market beset by a shortage of land and expensive development costs."
Family faces two big development setbacks - May 16, 2007
Clean Up Your Act:
"And, depending on a City Council vote later this month, the family could be ordered to clean the site up while everyone waits to see how it all turns out.
For the family, the news has not been good. "I think we'll probably have a meeting and decide what to do," said Noel Eriksen, one of the four family members who make up Eriksen River Properties LLC.
"If it's going to be another year out - boy, that's gonna be tough."
"This is inexcusable on the part of the city," Eriksen said. "Inexcusable.
The neighbors, though, are just happy that the property might get cleaned up while the Eriksens figure out what to do next."
Discontent grows at Broken Top - February 15, 2007
"How I Turned a million in losses into a fortune & You Can Too!", aka The Bau-humper:
"The family trust bought the controlling interest in Broken Top Partners LLC, the club's owner, in early January from Bend developer Don Bauhofer.
Six months earlier, though, Bauhofer offered to sell the club to its members at prices ranging up to $55,000 apiece.
Claiming unending losses on the course's operations, Bauhofer and his ownership group gave the members 10 years to come up with 300 buy-ins to complete the deal. But the deal came with a deadline: 100 members had to buy in within a short time frame, or Bauhofer vowed to open the course to more public play to increase its revenues.
The members beat the deadline, coming up with more than 140 full-cost members and another handful of $5,000-apiece "social," or non-golf, equity members."
New player enters the Broken Top saga - May 24, 2007
"In a memo to some of the club's members earlier this month, which was widely distributed on Internet bulletin boards and e-mail lists, Tom Brenneke, a Portland-based member of the club's new ownership group, essentially outlined a two-pronged choice for the members: Let the owners develop part of the club with up to 500 hotel, condo and townhome units, or be ready to pay higher dues to cover the costs."
"And a group of members who filed a legal action earlier this year to uphold a membership buyout plan pitched last year by former owner Don Bauhofer has threatened to turn the legal action into a full-blown lawsuit if Brenneke's ownership group fails to respond to requests for mediation by Friday night."
"The club has suffered and continues to suffer operating losses in excess of $1 million per year," Brenneke's e-mail said. "While we work toward a solution with club members and homeowners, ownership is committed to funding the operating losses. It is critical that we arrive at a mutually agreeable solution in a timely way in order to prevent the threat of bankruptcy."
THE MONUMENTALLY STUPID:
Redmond takes first step toward water park - May 8, 2007
"The project's developers say the Redmond Waterpark Resort would create jobs, transform the city's tourism economy and provide year-round recreation."
"It would also generate a lot of fun," said Bill Schertzinger, a partner in BGJJ LLC, which is developing the project, and a Redmond-based architect."
"I don't see a downside."
There's more. Much more.
The super-bubble of Central Oregon RE has changed the character of this place in just a few short years. There is very much a Gold-Rush, screw-you attitude. The sum total of a persons value is "What Can You Do For Me?"
The RE industry, never a bastion for holding ethics in a hallowed regard, is overrun with sleaze and liars. The local media give them first, middle and last word, and never a single followup on clear lies. If anything, they get more exposure for ever increased sleaze marketing.
Every person who can possibly capitalize on the Cent OR land rush, IS or sure as hell is trying. That is largely all that's left around here. People have taken leave of their senses and their decency. A couple in Ashwood wants to turn their farm land into a resort of 5,000 homes, nevermind that Ashwood has a population of 120 people. Residents of Broken Top are being strongarmed into a deal where they are damned if they do, and damned if they don't - solely because there is a buck to be made.
Long-time residents are simply being forced to move because taking their apartment condo benefits some slimeball developer. Virtually nothing will be done to improve the property, but the price will triple. And the attitude is "Take it, or get out."
People who bought "early", are getting screwed out of parks, roads and other "promises" made by developers because they trusted them. Once the homes are sold, there is no park, no playground and no roads built to accompany the traffic.
Projects are represented as "SOLD OUT" solely for the purpose of actually bringing in suckers who can buy "the last remaining unit", despite the fact that NO units have really sold.
Laws voted in by US and land use laws are being contorted to serve the purposes of developers. Measure 37 essentially gives any longtime landowner a license to do whatever they want with their property, incluing throw up a subdiv surrounded by farms, and to hell with what it does to any of them! Destination Resorts are basically stealth subdiv's that will begin to pockmark the countryside.
There's nothing to do about it, really. It comes with the territory. I saw a quote in the movie "Blood Diamond" along the lines of, "Whenever a commodity of value is found in Africa, the locals are slaughtered in large numbers and in the most inhumane ways imaginable." While it's not that dramatic here, the commodity of value here, for the time being, is land and what will happen while it's value is extracted is probably going to horrify those who call this place home.
Here's my prediction: Many area Realtors will leave, or buy an Awbrey mansion & retire in the next few years. Once the well is dry, which is happening now, they will have made their pile and will call it quits. Destination resort builders will leave hundreds & thousands homes in half-built subdivs just sitting in the middle of nowhere. Golf courses will go to seed, man-made lakes will dry up. Same for Measure 37 claims, they'll just pockmark the land. Oregon's attempts to prevent sprawl with it's land use laws will have been upended by the relentless pursuit of moneymaking. There won't be anywhere to "get away from it all" around here anymore, because "it all" is everywhere. And it'll have all the appeal of half-assed mobile home parks.
Funny, but few people like mobile home parks scattered all over their pristine recreational acreage. They will go elsewhere, where short-sightedness wasn't allowed to run roughshod over common sense. We're allowing the gutting of our greatest asset: our natural beauty and wide open space. We're starting to "cannibalize" each other for a buck. We're throwing hundreds of millions into mindlessly stupid ideas like the Redmond water park.
This bubble has created some of the stupidest actions conceivable. We'll be paying for it for decades. What's really sad, is that we can't "undo" it. Once these ill-conceived projects get started, the first thing that happens is bulldozing of the whole site. How many thousands and THOUSANDS of acres around here are platted for the mindless building of homes that NO ONE WANTS?
I say again: The folly of what we are doing will seem almost inconceivably stupid in the decades to come. "Somebody should have put a stop to that", will be the Bend Buzz Phrase. Mark my words: $180,000 medians will sound damn reasonable in a few years when there are years of supply sitting fallow in the Central Oregon scrub. We're digging our own grave, RIGHT NOW.
199 comments:
Long-time residents are simply being forced to move because taking their apartment condo benefits some slimeball developer. Virtually nothing will be done to improve the property, but the price will triple. And the attitude is "Take it, or get out."
Apartment to condo conversions are happening all over, more so in Portland than in Bend. You've championed renting in previous posts, but there are downsides to renting too -- rent increases, condo conversions, rental house being sold out from underneath you (that happened to me).
People who bought "early", are getting screwed out of parks, roads and other "promises" made by developers because they trusted them. Once the homes are sold, there is no park, no playground and no roads built to accompany the traffic.
Gotta hand it to Northwest Crossing here, they are building the parks as they build the neighborhood. Others are too -- for example the Sun Meadow park in the Pahlisch development of the same name. Can you name any subdivisions where parks and roads were promised but weren't built?
This post has more than it's share of moralizing, something I loath. But I think in 10 years or so, when the gold-rush is over and all we have left is the barren heap-leach pit that is Bend RE, that many people will be embarrassed by what they've done.
I think a lot of people KNOW that what they're doing today WON'T WORK... a developer in Redmond said as much in a recent interview. These projects are just moronic, but they're going to build them anyway. Same for Prop 37 crap. People are doing some "mean-spirited" crap. The Cyrus family in Sisters is filing Prop 37 claims like there's no tomorrow, but by God they'll fight tooth & nail an attempt to put power poles on their land for the sole purpose of POWERING THE HOMES THAT THEY WANT BUILT.
Embarrassing & shameful. It's one thing to lose money, it's another to be total assholes in the process, and the unbridled greed that this bubble has unleashed is producing assholes in unending quantities. And they're us.
I mean look at Broken Top: This is a situation so weird it defies description; the rich totally screwing the rich. And not the rich "way over there", but neighbors being pitted against each other.
We'll all look back on the stupidity of what's going on financially & chuckle. But some of the morality & plain human decency that is being thrown to the wind will never be forgotten.
Tired of Blogging, Are you Bored? There is an alternative.
Adolescent boredom, the leading cause of surliness in teenage males and the third most common cause of unwanted pregnancy in females under the age of 16, has baffled doctors for decades. As recently as 1997, medical researchers almost universally regarded the condition as incurable. Yet, according to the new report, even a small quantity of glue, when inhaled, can alleviate many of the most debilitating effects of adolescent boredom, including introspection, awareness of the passage of time, and consciousness.
"The glue worked great—I hadn't felt so little boredom in years, mainly because I wasn't aware of my surroundings, peers or self," said study participant Ryan Jenkins, 14. "The only downside was, when I woke up behind the Dumpster, like a couple hours later or something, I had this splitting headache. Oh, and somebody stole my shoes. But other than that, it was the bomb."
Can you name any subdivisions where parks and roads were promised but weren't built?
The entire area west of Mt-Washington rd, on the west edge of current NWXC is supposed to be park.
There are 1-2 small parks in NWXC and a large grade school. That said less than 1/2 the planned NWXC parks have been completed and/or initiated.
It currently appears that there will be NO more park's in NWXC as things aren't going as planned.
My point here is before we start using NWXC as an example, I suggest you study the master plan and realize how little actual park that has been promised has actually been implemented. That said I'm glad they haven't yet bulldozed the Junipers as that in my mind is the park.
Anything that is allowed to remain 'virgin' is far better than anything that we call a park.
Broken-Top Resort is proving that todays park and/or golf-course will be tomorrows hotel and/or mall.
Apartment to condo conversions are happening all over, more so in Portland than in Bend. You've championed renting in previous posts, but there are downsides to renting.
I rent single-family homes in Bend and Portland. I have many friends in Portland with twenty-plexes,...
I haven't seen much change in Bend RE market people with money buy. People with no money rent. There are so many empty houses in Bend that it will take years to fill, this will keep rent low. In all my years here, its the same as its always been $500/mo for an apt, $750/mo for a house; and ALL you'll get is losers.
Portland is different. It's exploding, the ONLY place you can get an apartment now for $500 is Gresham, with gentrification all the blacks and mexicans, and white-trash have been shoved to Gresham.
Inner East Portand rental homes are almost impossible to find now. When I advertise in craigs-list I'm getting 100-200 calls per day, and over fifty email inquiry's per day per house. Trouble is 90% are from out of town, with NO job. They dont' seem to care about paying $1800/mo for a home that was $900/mo last year, they thinks its a good deal. They're coming from california because things are too expensive.
They all think there are jobs in Portland, they have saving's and they're willing to blow it until they find a job.
I don't rent to people without verifiable income, thus I have to send 90% of applicants away.
My friends in the apartment business, always move people in the same day cash. When they move out, all they do is spray lysol, and move the next people in.
In Bend its as hard as its always been to rent. I have to make the place special clean, landscape to perfection, and then spend a month screening people who have no history of destroying a home.
In Portland right now I have duplex friends that are turning people away if they cannot move into today with full payment.
Where is all this going??
Here is my opinion.
Sacramento hit $750k for a home last year, in two years those homes will be $200k. Many people who came from california will have exhausted their savings, and will look south for the bargain, and there will be a reverse migration. This year watch out. In two years the empty houses in inland california will be just like in Bend today.
People like ourselves that have been telling renters for 5-10 years to rent cheap, and save your cash have been redundant. Renters have now figured this out. Problem is now rent can be higher than a mortgage, but over night with the MTG business closed to sub-prime, and the fact that nobody has a down. They cannot buy.
What has happened to Portland is that most if not ALL inner east-side homes got sold during the gold-rush. Why mess with renters with a house that cost $50k { fifteen years ago }, when you can sell it for $500k, and NOT deal with renters. Thus the homes are gone. Even the sleaziest apartments in inner east-portland have been converted.
Take a twenty-plex that can be had for $500k { A friend just bought one in Tigard last month, these dumps can still be bought }. Convert it to a condo. That means paint it, and put in granite counters, viking stainless appliances, and SELL IT. People are buying these 'condos' for $300-400k. Let's pencil, buy the place for $500k, put in $200k, and sell for $8M. Discount 10% for the realtors, and your still talking $5M walking cash.
This is the hottest game in Portand now. The problem with this in Bend is the SHIT apt's are on the east, and NOBODY wants to live there, the SHIT apt's on the west are very few, and most have already been converted.
In Portland there are tons of shitty apartments { thus the reason they sell for $500k }. Let's pencil that game. Twenty units $500/mo, is $10k, but you figure that 3/4 don't pay rent, and constant FED's { evicntions }, you actually might take $5k/mo. Which is about right $60k year which is close to 10% of the property value. Hey its a business.
One thing is certain since ALL of our love here is Bend.
This whole new class will NOT be coming to Bend, fewer newbies will be coming to Bend, as most of our incoming crowd to Oregon will have NO disposable income.
I don't see people moving to Bend, even if the word gets out that you can rent for cheap. Even white-trash know there are no jobs in Bend.
The immigrants { mostly eastern-europe } in Portland that I know think Bend is just a place for rich people.
The entire area west of Mt-Washington rd, on the west edge of current NWXC is supposed to be park.
There are 1-2 small parks in NWXC and a large grade school. That said less than 1/2 the planned NWXC parks have been completed and/or initiated.
Since the beginning of Northwest Crossing they've had Lewis & Clark park, Compass park, and Discovery park on the map. The first two are built and the third is the one you're referring to on the west side of Mount Washington Drive. They have been building the parks as they build the residential phases around them -- Lewis & Clark first and Compass second. They haven't started building the phase around Discovery park yet.
My point here is before we start using NWXC as an example, I suggest you study the master plan and realize how little actual park that has been promised has actually been implemented.
Northwest Crossing is a 10-15 year project, they've been saying that since they started building five years ago. It's a work in progress, not a finished product. Even so, there are more parks in Northwest Crossing per capita or per acre than most other neighborhoods in Bend, so that's a point in their favor.
IHTBYB - Excellent post as always, good detail
It's fairly clear that Redmond and Bend argument is over. Both places are being ran by the same class of people. Hell, even Sisters is going the Redmond route.
I think we can concur that for ALL the marketing that is being done, the only real success is Mexicans coming in to make Bend-Redmond-Madras a HUB along the I97 Mexico-to-Bend bus/truck route.
What Mrs. Breeze really needs to do, and to it quick is convert her condo's to Tijuana housing 'shacks' or market them as such. They also need people to know that Bend is Mexican friendly.
White-Trash migration is up to Oregon, but the on immigrants to Cent-OR these days is Hispanics. Most likely this is because the few 'rich' in Cent-OR need lawn-care, house-cleaning, dish-washers, ... all jobs that Mexicans do without griping.
On the other hand, the Willamette Valley is cheap, clean, and FUN for young white-trash-immigrants fleeing california because its "Just too expensive".
Where is all this going??
WRT to this weeks post, it seems that IHTBYB has done a good job of showing the Greed->Denial phase to date of the Bend-Bubble.
I would really like to see some comments on the CDO collapse now that it is here, everyday the MTG biz is just getting worse.
Too many things coming together: Easy money is gone, prices collapsing, Mexicans coming in by the bus/truck, pristine areas being destroyed.
Let's all be honest here, Bend has become another Redmond. If you excluded the inner Mirror-Pond area from Bend, then Bend would be today every bit a shit-hole as Redmond.
Ergo I propose the inner mirror-pond become its own mini-city. Perhaps eco-bend, and then we call all East RedBend.
Lastly, did you all see the other day that Mirror Pond is now considered to be the top crawfish place in the west?? This could be the food solution to the bubble.
Really, really great post.
I agree wholeheartedly. It's one thing that, sure, forces beyond the control of anyone in Bend will return sanity to the MARKET, but that will do nothing to rectify the excesses wreaked upon the LAND.
Oregon has always been a place of resources. Not so much a place of learning, not so much a place of invention, not so much a place of commerce. At some point last century when the fishing and logging and mining were starting to die down, some far-seeing, innovative lawmakers and citizens saw that when they hit a rough spot Oregonians would be tempted to sell their beaches, their agricultural land, open spaces and so on for a buck, and then the buck would get spent and the land would be changed forever.
And now we're dismantling all that foresight with M37 and destination resorts and campaigns to bring Californians up here, and all the money's been squandered, and all we can do is think of what other real estate we might be able to sell off.
Can you name any subdivisions where parks and roads were promised but weren't built?
Isn't the pool / rec hall at Renaissance Ridge in doubt, not built, etc., along with some of the parks?
Renaissance has the pool and a small park done. Seems like things have come to a halt there though. Isn't Renaissance building a subdivision off of shevlin across from 3 pines? I still wonder where they think all the people are going to come from to buy all these houses. Next week should be interesting. I think the Bear Stearns blow up is finally rattling some folks on wall sreet. But who knows, every time I think the market will drop, it goes up. Maybe I'm missing something.
Next week should be interesting. I think the Bear Stearns blow up is finally rattling some folks on wall sreet. But who knows, every time I think the market will drop, it goes up.
The market did go down, all last week.
The $3.2 Billion will only cover the 'A' funds @ bear-stearn, ALL the funds have been frozen for months.
This is ALL pension money. All those sub-prime ( we have already proved that SP is 90%+ of BEND MTG ) was all re-packaged and sold to Wall-Street VIA CDO's.
The Holders of CDO's are MA&PA USA PENSION FUNDS. How would you like to be told you just lost $1Billion dollars, and your not going to get anything back.
The CDO's were old sold as cannot-lose high interest well diversified assets all back by RE. They froze or I should say put the CDO piggy-bank into 'Holiday' a few months ago. Now we figure out who gets some of their money back and who gets NONE.
WHAT is interesting about bear-stearns is this is the NUMBER ONE, this is the biggy, and they just lost $3.2 billion, and it will cover NADA of the total loss.
Now what happens to the shady folks? The problem here is why write a MTG, if you cannot package it and sell it.
Like a trader buddy of mine said, right NOW this stuff is selling for 10% on the dollar, and some is NOT being bought at all. This is why Bear-Stearn's stepped in with the $3.2 billion PROMISE. Some skeptical analyst's thing there will be no actual cash. That everyone who bought will lose. We're talking $10 Trillion dollars here, with a known loss right now of $2 Trillion.
In summary, the stock market when down all last week. The thing is the DowJones average is frequently adjusted and really doesn't mean that much. Just like NASDAQ it should really be zero after DOTCOM, but they stocks that went to zero were simply removed, and replaced by high-flyers, thus over the long term our averages don't really give us the real picture. All that matters is week-to-week, and last week was all down.
I think something needs to be said about the rental biz. Given that this is my racket. My have nominated myself. In the finest fashion of IHTBYB I'll do so by dialog.
m-Landlord, r-Renter
First Bend,
r-hey dude cool house, how much, ...
m- do you have a job?
r-are you kidding I can rent anywhere in town, and nobody cares
m- I care, I care if you can pay the rent next month
r-I'm outta here, ...
m- next,...
( It's all a numbers game in Bend, in about one of twenty you find someone with a job that makes enough to pay rent )
Now Portland,
r-Hi, I'm desperate,I'm living in my car, just got here from CA/CO,... I have a wife and baby, and we're both school-teachers/nurses...
m-Do you have a job in PDX?
r-Yes,I'm sure I have job, my field is in high demand
m-Do you have a job today in PDX
r-I'll have a job in a week
m- Do you have a way to prove you have $120k for two years in cash equivalent assets to prove you can pay rent?
r-Say what?
m-Next
and Portland again,
r-hi I love this house ( woman alone with two baby's in her arm )
m-do you have a job?
r-no but my husband does
m-where is your husband?
r-he works graveyard
m-can I meet him when he's not working,
r-no,you'll never see him, he works 12 hours a day seven days a week
m- I need to see him before I can accept application, because I need to verify ID
r-I'll talk with him
m-next
In all my years in this biz, Bend is just like it always has been.
But Portland is insane, people are hysterically. They cannot find a place to live, and they're finding that in Portland, if you want to rent a house you had better have job.
Everyone is saying the same thing. "I had to leave California or Colorado because we couldn't afford to live there. So we packed the bags and portland here we are, OH and buy the way we want to live in a nice house on day-one of our arrival. We're good people. We shouldn't be living in our car with our children, ...."
What I'm trying to say here is that our RE bubble is really fucking up peoples lives.
These people I'm seeing have no money, they have no jobs, and just show up. The CITY of PDX had better quick be setting up some homeless shelters and sending out a marketing signal to calis and colo's that there are no jobs here, and there is no cheap housing.
Personally because I haven't yet gotten anyone to tell the truth, my guess is what I'm seeing is people who have lost their home, and having had a home, they want another, given no job and no money, they could get a shit apartment from any of my friends, but they want a nice house NOW, just like pre-bubble everyone wants nice shit now.
Ok, now the issue I'm trying to get to ... This seriously looks to me like the start of a serious fucking depression. At least in PDX the houses aren't empty, wait until these people start over-flowing to Bend, when they here that homes rent cheap to morons that don't know how to screen.
Deschutes county should be ready to see the welfare roles skyrocket.
This is my point.
Sadly, I too hate to see people get fucked, but in PDX if you knowingly rent to someone who cannot pay rent, then its hell to get them out.
In PDX you can get free lawyers, ... Bend is another world, just throw their shit in the street. But in PDX the renter is KING, and thus you have to make sure they have a job before they MOVE-IN.
The Mountain Gate crossing high density retail/condo project is dead on arrival. The hearings officer denied both applications because the applicant did not follow the proper procedure and do a plan ammendment and a replat.
Deschutes county should be ready to see the welfare roles skyrocket.
The mexicans are really invisible, living where they work, and working all the time.
The white-trash moving to Oregon will be visible living in their cars. They don't work like Mexicans because they're good people ( we hear this alot ).
Good people deserve good jobs. Tell that to someone in Bend working two restaurants jobs for a decade.
Why is Oregon not planning for the relocation.
While Oregon, and I should say Portland is still humming in RE sales, it will slow down, and all these additional people will add to our un-employment when it hits. We'll be the last to go south, but also the last to correct.
Isn't Renaissance building a subdivision off of shevlin across from 3 pines? I still wonder where they think all the people are going to come from to buy all these houses.
Yes, I rode my bike through the Renaissance "Shevlin Pines" subdivision a week ago. The lodge/sales office is built and they're starting to grade some of the lots for construction. No views to speak of except for the lodge which is at the top of the property. Here's what their website says about it: "Located in one of the most desirable areas of Bend, Renaissance Homes took special care selecting the location of our Shevlin Park neighborhood. We developed the land to accomodate large homesites while conserving as many of the mature trees and greenery as possible and even included a community pool."
Renaissance has also filed an application to build between the Deschutes river and the River Rim subdivision. The Elk will no longer have a path along the river.
For the most part Renaissance removed just about every tree in "Renaissance Ridge" along Brookswood. I laugh when I read their ad with tight clothed Mr. Sebastian about how green they are.
I laugh when I read their ad with tight clothed Mr. Sebastian about how green they are.
I forgot that one. That Sebastian makes me want to puke. He's "green" for the camera, but if it prevents a single freakin' house from being built, he'd slaughter a whole herd of elk.
Hypocritical bastard.
Here's a "green" idea for you:
Stop building houses you can't sell! Homebuilding by it's nature just destroys whatever was there in the first place, and these idiot developers are building like crazy for a market that essentially doesn't exist yet.
I am FINE with making money, and all... but these sleazebags are acting all green, when that is the last thing on their mind. They can & will disrupt any eco-system out there if it means making $5! And we're in a market where no one wants these homes. 121 sold last month guys! 121! It's OVER!
That Sebastian point is PERFECT: The guy will completely cut off elk access & migration points to build a SINGLE HOUSE. ONE STUPID HOUSE! Unbelievable.
Yo Paul,
No worries bendbust will buy those Renaissance homes you know at 4x his income and then he'll turn them in to positive rental income. Bendbust is the best, he one smart gringo.......
I have to love that poster who says he is some mega landlord.
"I know people who own 20 plexes in Portland"
Yeah, I read this blog in my underwear in Hawaii where I live half the time and commute to Portland to make money in the sleazy mortgage industry.
Oh yeah, and I know people who own 100 strip malls in Los Angeles.
Mega landlord...can I get your autograph?
Your post about buying for $500k and selling for $8m is so silly.
Condo conversions are not so easy. Also, in case you have not noticed, there is a glut of condos on the market in Portland. Idiot.
From how you talk I can tell you have never done one.
Oh yeah, my friend in Portland is converting an 8 plex, 12 plex, 10 plex and 15 plex and they are not selling.....just like most condos.
The Jefferson in Portland is opening in 2 weeks 70% un sold. Most of the South waterfront is un sold.
Anyway, I was going to ask the experienced posters on this site...where can I get some of the Redmond houses near the water park? I need about 5 owner occ units so I can sell them to the next idiot. I just need to be in on the first level of the scheme. Are they selling anything yet?
Mega landlord......
your post stating $750,000 houses in Sac will be $200,000 2 years from now? You think, in your esteemed wisdom, being the mega landlord that you are, that they will decrease 80% in 24 months?
Wow, you must know people that own 20 plexes there....
Mega landlord......
BendBust never said it was a mega-land-lord.
Bendbust is a poor mexican property manager that has been in bend for forty years.
BendBust knows lots of gringo owners.
Bendbust manages property in Portland & Bend.
BendBust loves Gringo.
BendBust NEVER said it was a mega-land-lord.
BendBust has only said that it has seen lots of boom & bust cycles in Bend & Portland during the last forty years.
your post stating $750,000 houses in Sac will be $200,000 2 years from now?
Sac is an exceptional case. I have a latino buddy down there that bought a home for $750k. Him and three other's put together $60k down. At $20k per-person. Everything was fine.
Then after three years there MTG reset. The initial teaser loan was $1200/mo, after reset the loan went to $3800/mo they cannot afford the home and its currently in foreclosure.
My buddy and his partners are mexican agriculture workers making $20k/yr tops. They got the home as a stated income loan sold by a MTG broker. Currently they have a legal-aid CA paid lawyer suing the MTG for not telling about the reset. They have lost their $60k.
This type of situation is VERY wide in Sac, this is WHY I believe that SAC will go down from $750k to $200k, these are suburb mcMansions in the out-skirts of Sac, sort of like the Shevlin Park stuff, they're about 2800sq-ft.
In summary stated-income, low-down, ARM MTG's were sold to lots of people in Sac that didn't know what they were buying. This had to be done to create a market for this shit out in the middle of no-where.
This is why I say that Sac homes will drop to $200k.
No worries bendbust will buy those Renaissance homes you know at 4x his income and then he'll turn them in to positive rental income.
BendBust only manages property in red-hot areas of PDX & Bend.
Renaissance doesn't meet our business-plan criteria. We focus on area's that are 'close-in' , and have historic demand ( easy to rent ).
If Renaissance homes do drop in ASK price to 4X ( four times avg bend wage ) $240k, will you buy? I certainly would not, anymore than I would buy at Shevlin-Park, or NWXC.
These places will be rented , but by people who don't know how to screen tenants. Thus these places will be barrio's in ten years.
I think this 4X thing is getting boring. Nobody in this forum seems to read.
Here is all that ever has been said about 4X.
1.) When screening a renter you need to make sure his/her income is AT LEAST 4X of his/her rent { Where x=rent }. Otherwise they cannot pay rent. Your going to have an FED.
2.) When as a bank you loan money to some gringo to buy a house, you make sure that his annual wages are at 1/4 of the HOME price. Otherwise your going to have a foreclosure. This is a historic issue of what people can afford to pay. A banker wants to squeeze as much blood as he can, but not kill, if you kill, then you collect no interest on your money. Letting people get into debt over their head is NOT a good thing.
3.) The natural historic affordable price like P/E, or INCOME/ASSET is 4/1, once people are spending more than 25% or their gross on housing they generally screw themselves.
Thus from a landlord or bank point of view { they really do have to think the same }, you don't want a buyer or renter paying more than 25% of his/her wages on rent/mtg. A landlord is really a subprime lender, we're let people move in for zero-down.
This is all that was ever said.
Now WRT to Bend, how this works is that right now we're in a collapsing bubble. The prices will fall below the $240k (4x), perhaps to IHTBYB's figure of $180k, but I firmly believe that because of historic affordabilty issues the prices will stabilize near $240k in the longer term. There will be more bubbles in my forty years in Bend I have seen many boom and bust cycles. Our current bust is NOT the end of the world.
Now NOTE I'm only using the MY definition of red-hot historic market near the Mirror-Pond for my 4X stabilization. I think the shit out-of-town has NO real floor, much of it will go to seed.
All this shit that you gringos love out in shevlin, nwxc, broken-top, The-Shire, renaissance, ... that shit will all be $180k, because it all should have never been built. Perhaps it may not even fetch $180k, we'll just have to wait and see how easy it is to get money in 2-3 years from now.
The 4X is a banker/landlord issue, it has really nothing to do with value, or what the FLOOR is on our collapsing bubble. That said, people need a place to live. The conservative banks in the future that survive are only going to loan 4X. Thus on the average as a seller that's all you can expect to get.
Many houses in near Bend were built that have literally been priced out of the average-income market. That is there problem. When money was EASY it probably was a good idea. Money will NOT be easy now for another generation. Too many people have will have lost their pensions, and the CDO/MTG market is going to now become VERY conservative. For a long time.
Condo conversions are not so easy. Also, in case you have not noticed, there is a glut of condos on the market in Portland.
I have defined several times that you need to be in RED-HOT areas. For PDX that's inner, and I have defined that as inside of SE20th, north of Clinton, and South of Fremont. Fringes can be included, for instance being near to Ladd is just a good as being in Ladd.
There is a glut of condos near OHSU, they overbuilt, there is a glut in beaverton, ... There is a horrible glut in NW-PDX.
The conversion of shitty old apartments to condo's is going very well in inner-SE PDX. There is a forty-plex one block north of Division on 21st that is a brick-building that is almost sold out at $200k-$400k. Same old thing they didn't do shit except stainless appliances & paint, and pressure-wash the outside. It's the RED-HOT nieghborhoods where condo's are selling.
I personally HATE condo's, I think that anyone who buys one is a MORON. That said there are a lot of morons.
Nobody ever said condo-conversion was EASY. If it was easy every fucking gringo would be a rich man. Right?? Most gringos have a negative net worth. Right now as a land-lord I only see gringos living in their cars, I never see latinos living in their car.
Let's play the numbers again, ... Buy a twenty-plex for $500k, and get an RE whore to market for 10%, or more remember they need to sell this shit before its completed.
Like I have said the cost per unit is say $25k, and the cost of improvement is $10k { paint, stainless app, granite counter }. SO the unit cost is $35k, as long as you can sell for $100k your making good money.
The problem to date is GREED, everyone thinks they can sell for $400k per unit, what are these little shit-holes really worth?? My guess is they're worth what they cost $35k.
I have written many times in this forum that effective Feb2007 you can NO longer borrow $$ to fund NEW condo's. Now you MUST sell 25% of the units before the bank will loan you the money to build NEW units.
I think this is where your missing the point. The new NW-PDX, or OHSU water-front, ... That shit is NOT selling.
The affordable stuff in RED-HOT areas is selling. The red-hot area this week in PDX is inner-SE and Albina. The red-hot area of Bend is one-mile radius of mirror-pond, and west of I-97.
When I talk about business, I don't even think about shitty areas. I only think about historic red-hot areas. Like OUR BEND I have no idea why people sink money into the Badlands {shevlin,nwxc,...}, I can only assume its because its other-peoples-money.
Now I'll explain how it's done, and NOTICE loser's, I never said it was EASY.
You buy a shitty Apartment on contract for $500k from somebody sick of the begging white-trash to pay rent. Say 6% personal note. You kick out the people. You put in $200k of your own money, or take equity out of your house for improvements. You hire a bunch of mexicans to paint he building, and throw in the stainless appliances yourself. You find a hard-up whore realtor, and tell her she can get 10% of the gross and start marketing. You get one UNIT absolutely perfect with granite, tile, woodstove, and you make this the sales-office and give your realtor the key. Cash is about $250k, assuming $50k down for the building. Does any of this sound easy? The units can sell from anything from $100k->$400k, but as long as there over $50k, your making money. Even if you sell the units for as low as $100k, that's two million, our realtor gets $200k, and you clear about $1M { less $450k payoff }, that's a 400% return on your money. Any condo conversion in PDX can sell for $100k, but most are asking $300-400k. This kind of project can be done in three months if your young.
This is the game now, owner finance, the bank isn't going to loan money anymore for condo's, but the fact is they'll sell, if you price them low enough. In order to do that your expense has to be low.
If it were easy to be rich, then every fucking gringo would be rich. The fact is it has never been easy.
I'm NOT saying this is a good game,as I have already said I feel that what is happening is that we're bringing in ton's of white-trash to Oregon, and there's going to be NO-WHERE for them to sleep. Which means people living in their car's in Bend & PDX, sky-rocketing crime.
I only discuss the game because it needs to be documented. Besides perhaps there is a young latino out there that wants to get rich the old fashion way, someone has explain how its done.
Today's front page WSJ finally has announced the bad news. In 1-2 days the Oregonian and Bulletin will follow. July 2007 will be the month of BAD news for the masses.
If you still owe a home, and had to sell, and didn't sell, you are NOW fucked.
******
Existing Home Sales, Prices Decline
By Jeff Bater
WASHINGTON -- Existing-home sales dipped during May to their lowest level in nearly four years, while inventories climbed and prices fell a 10th straight time.
Home resales fell to a 5.99 million annual rate, a 0.3% decrease from April's revised 6.01 million annual pace, the National Association of Realtors said Monday. April's rate was originally estimated at 5.99 million.
The median home price was $223,700 in May, down 2.1% from $228,500 in May 2006. The median ...
•
"The Franklin Crossing building, in particular, with its ground- and second-floor retail, third- and fourth-floor offices and upstairs condos "has a penthouse feel," DuBois said. "There is a real feeling of uniqueness to it."
Doe FC include pimps and RE-HO's? Penthouse is an awesome magazine. This place has the feel, and is unique. How's the night life outside?
The gutting of Bend's industrial base continues:
More industry leaving Bend
Another Bend manufacturing company is leaving the city to expand elsewhere, saying Bend's limited industrial land supply and the high prices that the land commands have priced it out of the market.
"It's just not cost-effective to stay in Bend," Ameritech's Cook said, joking that Bend doesn't want the company.
In October 2005, Bend Tarp & Liner announced it was being priced out of Bend and was moving its 16-person manufacturing operation to Prineville, where the new site's 10 acres cost around $2.50 per square foot. Tarp & Liner officials, like Ameritech, said Bend simply doesn't have enough space to expand. And what little space exists is too expensive to pencil out.
Twiddling our thumbs while Rome burns....
Doe FC include pimps and RE-HO's?
One of the principals of Keystone Partners retained ownership of Franklin Crossing's $975,000 northwest corner unit before the rest of the condos were put on the market.
Sheeeet Gee! Coss day gots da pimps! Who mac da hoes wit-out pimps? Sheeet. Day buss'n out da back'a dem hoes 23 6.
"Obsession is a young man's game" -the Prestige
Portland is now a boom town. It is THE place to go if you are from California and you want to escape the overcrowding and prices, which means it is already in reality, NOT the place to go. Nonetheless, this immigration isn't going to stop, and some of it will carry over to Bend.
Ironically, I bought a house in Bend because I thought it was off the map. I had no idea it would explode the way it did. I came here after much thought and realization that it is NOT a place to make lots of money. It seemed a beautiful place where ordinary people could enjoy life without being crushed by prices. It saddens me to see so much poor planning and waste going on here. The way prices are now, I could never afford to buy here, and I would not even consider it. Nonetheless it is still a great town to live in if you got in several years ago or earlier. And it is still a good place to live if you don't mind renting.
Over here in Portland, I don't see any more out-of-state plates than usual this year. Portland is perennially a place where more people want to live than the jobs will support, so the unemployment rate is always higher than most major cities. RE over here was very quiet this weekend. NOONE out looking at the places I visited (Villebois, DR Horton Newberg "the greens, now from $360K", and Arbor's places. All very quiet.
I could never afford to buy here, and I would not even consider it. Nonetheless it is still a great town to live in if you got in several years ago or earlier. And it is still a good place to live if you don't mind renting.
Just rent, save the difference and wait, next year there will be tons of deals in Bend.
The problem again is job's, if you got a $60k+ job, or your self-employed in Bend, just wait.
Bend will be real nice in a few years, all the get-rich-quick will have gotten burned, and moved-on.
Hollywood will come to Bend to film Horror Flicks and burn down Shevlin, as it has more value as a film-stage.
Over here in Portland, I don't see any more out-of-state plates than usual this year.
Yes, I didn't see many Colorado plates in Newburg this weekend either. NOT.
People don't want Siberian Suburbs gas isn't going to be cheap.
All I saw showing rentals this weekend in PDX was out-of-state people trying to line up a rental for the Move July 15. FYI they all are driving rental cars. Very few were driving their CA or CO plated cars. I just know the CA, CO because they all have cell phones. I'm getting 100's of calls per day, and only a few are 503 or even 541.
Portland is now a boom town. It is THE place to go if you are from California and you want to escape the overcrowding and prices, which means it is already in reality, NOT the place to go. Nonetheless, this immigration isn't going to stop, and some of it will carry over to Bend.
Sadly, it will carry to Bend. All these cali's want to be cool, they're all 'creative', which is slacker code for "I don't work".
How in the hell are they going to make it in Bend. In SE-PDX its common for ten or more slackers to share a house and trash it. I don't see this lifestyle in Bend.
It's always seemed to me that Bend slackers were trust-fund snow board dudes.
. It seemed a beautiful place where ordinary people could enjoy life without being crushed by prices. It saddens me to see so much poor planning and waste going on here.
Get involved go to City Council Meeting and Yell.
Don't be one of the 99% of Bend Dis-Engaged.
Tell our elected politicians that they have fucked Bend.
Put a bumper-sticker on your car that says "Don't Californicate Bend".
Think Global, Act Local. There are MANY ways to get involved.
The Bend planners are very proud of themselves. Trouble is the only people they see are Becky Breeze and crony's.
Hold the Planners responsible for the damage, then perhaps future generations might learn.
Join your neighborhood association. Attend council meetings and land use hearings. Read the cities website. Read the counties website. You can make a huge difference, but whining amongst yourself will do little good.
I just moved to Bend. I have had several engagements with the Bend Police. Why are they such assholes. The Bend Police treat everyone like shit. What gives with this small town?
Grab a few more brewskis, dude! Then, when you had a few too many beers, some winter night a cop will pull you over, and when you try and get away in your 4x4 Jeep, that cop will blow your brains out in self defense, since you mighta run him over, and it would be too much to ask of the cop to just step aside.
Welcome to Bend, where the cops are not just assholes but legal killers also.
I have had several engagements with the Bend Police. Why are they such assholes.
I think I smell dirtbag, find another town to trash. NEXT.
If you say so, Mr. Realty. I see apartments running specials to fill them.
" ... the unbridled greed that this bubble has unleashed is producing assholes in unending quantities."
Take it from someone who's lived here for more than 20 years: The assholes were always here. The real estate boom just gave them more scope in which to exhibit their assholeishness.
Realtor.com Inventory update:
May 14: 2,280
May 18: 2,320 (+40 -- 4 days)
May 23: 2,343 (+23 -- 5 days)
May 31: 2,391 (+48 -- 8 days)
June 11: 2,439 (+48 -- 11 days)
June 16: 2,464 (+25 -- 5 days)
June 20: 2,514 (+50 -- 4 days)
June 23: 2,546 (+32 -- 3 days)
June 25: 2,565 (+19 -- 3 days)
Inventory is still on a tear, but the percentage growth does seem to be slowing. We peaked out in August of last year, but I'll bet it'll be July, or even June this year. Seems like months of inventory has to come back a little, somewhere near 10 months.
That said, I still don't think that'll lend support to prices. One hell of a lot of 6 month listing contracts have been signed in the past 90 days, and they'll expire in October at the earliest. That, plus a major slowdown in sold volume probably means inventory will stay higher longer. We're into "Need To Sell" time now, all the "discretionary seller" talk will soon prove to be hot air.
I'm still betting Q3 will see the first YoY declines in Bend home prices in over 20 years.
Mark my words: $180,000 medians will sound damn reasonable in a few years when there are years of supply sitting fallow in the Central Oregon scrub.
Prices are never going to come back down to $180,000 medians in Bend. If you plan on renting until they do, you'll be renting the rest of your life.
YOU MUST BE ONE OF THOSE KOOL-AID DRINKING FOLKS. MOST LIKELY YOU OWN SEVERAL HOMES IN NORTHWEST CROSSING AND YOUR PRAYING YOU WON'T BE UPSIDE DOWN
It's no longer possible to build 2000' houses in Bend for $180,000 (land + labor + materials) so there's no way median prices will ever go down to anywhere near that level.
It's no longer possible to build 2000' houses in Bend for $180,000 (land + labor + materials) so there's no way median prices will ever go down to anywhere near that level.
Sure it is, just have bendbust and his gang of hommes slop'em up. He loves mexicans especially the illegal ones they work for less. Outside of that you are probably correct I doubt medians will ever make it down that low again even adjusted for inflation and I'm as big a bear as many out there.
You can buy a house in Detroit for 30K, but I bet you can't build one for that.
You can buy a house in Detroit for 30K, but I bet you can't build one for that.
You may be able to buy a $30K house in Detroit if you want, but would you want to live in it?
Median for Detroit is $159,900, according to this website.
http://www.housingtracker.net/askingprices/Michigan/Detroit-Warren-Livonia/
Prices are never going to come back down to $180,000 medians in Bend. If you plan on renting until they do, you'll be renting the rest of your life.
I think you are dead wrong. I think it will take about 3 years. I think, adjusted for inflation, house prices will OVERSHOOT on the downside and you are looking at $150,000 medians in Bend. And I think people will be so pissed off about it they can barely see. They'll be blaming Clinton, they'll be blaming Bush, they'll be blaming Greenspan, they'll be blaming Bernanke, they'll be blaming foreigners, they'll be blaming illegal immigrants, name it.
It's easy. One of two things will happen: (1) prices will fall to the level where the median income can afford the median house (or almost so) or (2) incomes will rise to the point where the median income can afford the median house. Which is more likely to happen in Bend over the next few years?
Any other option involves a fantasy scenario with rich Baby Boomers or foreigners or someone else coming to scoop up overpriced houses no local can afford. It just will not happen. Not this year, not next year, not the year after that.
People are seriously underestimating how hard it's going to be to get the home appreciation cycle started back up again. Flip the channels. CNN, BBC, Fox News, MSNBC, they're all reporting how housing is in the tank. Literally every single hour, sometimes multiple times an hour, on Bloomberg there's a "housing slump" mention. Soon if you tell your acquaintances how you just bought an "investment property" or a "second home" or a "condo in the mountains for our annual Thanksgiving get-together" they are going to think you're an idiot or, at best, feel sorry for you.
Anyone with money in Bend property doesn't want prices to fall and from a human perspective I can't blame them for being blind to the possibility, nay, the certainty that they will fall. A lot.
But just name me a plausible scenario how all this local inventory is going to sell - and at prices that result in an increased or flat median. Just name it.
What's too complicated to explain here, but which I explained on my blog, is that once prices start to fall you have a spiral of increased interest rates and overall credit and liquidity crunch that make yesterday's happy debtors into wage slaves. The little-known secret of mortgage lending is it only works when house prices are risking and/or people have equity to lose. Here we have the one time in history where millions have no equity, an increasing/resetting interest rate and credit card and car payments to boot. What idiot wouldn't mail the keys to the bank and leave when he's $50K underwater and his house payment is 300% of rent for a comparable place, with no relief on the horizon.
This is why money is pulling out of residential mortgage lending at lightning speed. The situation is much, much worse than even the moderate bears in Bend are saying.
"house prices are risking" = "house prices are rising"
I'm seeing starter homes outside Portland for $180K. Think Bend will stay higher than Portland, with no jobs?
I think you are dead wrong. I think it will take about 3 years. I think, adjusted for inflation, house prices will OVERSHOOT on the downside and you are looking at $150,000 medians in Bend.
Excellent, a bold prediction with a timeline attached. Let's check back and see if you were right in 3 years (6 Friedman Units).
http://en.wikipedia.org/wiki/Friedman_(unit)
Any other option involves a fantasy scenario with rich Baby Boomers or foreigners or someone else coming to scoop up overpriced houses no local can afford.
Suggesting that no locals can afford the houses in Bend is a fallacy -- I personally know locals who have bought houses this year and last year.
But just name me a plausible scenario how all this local inventory is going to sell - and at prices that result in an increased or flat median. Just name it.
I didn't predict increased or flat medians, what I said was "Prices are never going to come back down to $180,000 medians in Bend." Prices may go down some, but nowhere near $180,000 medians (unless we have another Great Depression).
The situation is much, much worse than even the moderate bears in Bend are saying.
Government bail-out anyone?
I'm seeing starter homes outside Portland for $180K. Think Bend will stay higher than Portland, with no jobs?
Bend prices track Portland prices. Sure there are starter homes for $180K *outside* Portland (i.e. long commute to jobs inside Portland), just like there are homes for $180K in La Pine.
Jobs in Bend: Many are filled through informal who-you-know or friend-of-someone-who-already-works-there means rather than through a formal ad-in-the-paper process. This can work in a small city like Bend with two degrees of separation between residents, unlike a large city such as Portland.
Suggesting that no locals can afford the houses in Bend is a fallacy -- I personally know locals who have bought houses this year and last year.
If all of us -- including bubble-deniers -- have learned anything from the last year or so, it's that just because you bought a house doesn't mean you can afford it.
I didn't predict increased or flat medians, what I said was "Prices are never going to come back down to $180,000 medians in Bend." Prices may go down some, but nowhere near $180,000 medians (unless we have another Great Depression).
Why are we saying $180K? Because that's the point of "affordability" we've been talking about. National real estate market analysts came up with the number, not us, by applying various economic formulae.
Your opinion, on the other hand, appears to be pretty much a back-of-the-envelope, I-know-what-I'm-doing guesstimate.
If prices start to fall, why wouldn't they fall to the point where Average Joe can afford an Average House? Can you name a reason, even one pulled out of your ass, why prices in Bend would hover above a point where the median income can afford the median house?
Here we have the one time in history where millions have no equity, an increasing/resetting interest rate and credit card and car payments to boot. What idiot wouldn't mail the keys to the bank and leave when he's $50K underwater and his house payment is 300% of rent for a comparable place, with no relief on the horizon.
Damn straight. This place is an unprecedented occurrence in an unprecedented financial episode that has never happened before in this country: A Nationwide Housing Bubble. It's never happened on this scale. And Bend is the absolute epitome of the bubble. There could not exist a place that has participated more than this town.
What's funny is people say that there's NO WAY we could hit $180K again... when we were just there in 2004, $185,225 median in Feb 2004. I was the biggest NASDAQ bear I knew of, and when it was at 5,050, I sure as hell didn't think it could go to 1,250. I thought it might get cut in half, and EVERYONE thought I was crazy.
Japanese RE bubble has never recovered to even close to it's peak valuation, and almost certainly won't in our lifetime.
Man, when bubbles bust, it's almost ALWAYS worse than anyone thinks possible. Especially when there's some crazy-ass money-lending going on. Debt-fueled bubbles bust the hardest. There's going to be some sort of Long Term Capital style financial debacle before this bad boy is done. Not going to be bailed out by the Fed either, cuz the US housing market is too big.
The Big Tell for me that Bend is going to get CRUSHED, is condos. Condos are the skanky-ass crack-whore of real estate, and when there's a bubble afoot, the pimps bust out they condo-bitches in large numbers. Condos in Bend? That's the stupdest idea I've ever heard of. 5 -10 years ago you would have been laughed out of town for building condos.
And if Bend is the tail-end, mega-top absolute epitome of the housing bubble, Sisters is the blood-sucking flea on it's tail, and Sisters "mini-ranches" are that fleas ass. Sisters acreage owners have beeen overcome by the Kool-Aid fumes wafting in from The Old Mill condo regions, and have decided to party like it's 19,999.
I saw an empty 40 acre tract that was for sale 2-3 yrs ago for $399K, and it had no takers. I think it was pulled or expired, and they then actually marked it UP to $499K, or something. I don't know if it ever sold, and there's no property number for me to check on DIAL. But I drove by this past weekend, and it's for sale again. Price? $2MM. They paved to the homesite (there is NO home), and dug a well. $2,000,000, up from $399K in under 3 years. Lower Bridge Road & McKenzie Canyon Rd. Not even a premier location! It's freaking TERREBONNE! They crazy out there.
You tell me: You can't sell 40ac of scrub @ $399K, so pave it, dig a well, and mark it up to $2MM in less than 3 years? If that isn't bubble-on-the-brain, I don't know what is.
That's the stupdest idea I've ever heard of.
Strike that. Frodo & Bilbo just told me about something even stupider...
This post doesn't do justice to some of the dumbass bullshit that is happening all over Bend & Cent OR. It could FILL a book.
Speaking of stupid, does anyone know what that HUGE graded dirt pile is South-SW of town? I see it from the top of Pilot Butte, and it looks huge. Tetherow? I don't go to the Westside (or SW) when I can help it.
If all of us -- including bubble-deniers -- have learned anything from the last year or so, it's that just because you bought a house doesn't mean you can afford it.
Just because some people bought houses in Bend they couldn't afford, that doesn't generalize to Bend having "houses no local can afford." Your logic tried to leap a little too far there.
Why are we saying $180K? Because that's the point of "affordability" we've been talking about. National real estate market analysts came up with the number, not us, by applying various economic formulae.
You know as well as I do that analysts/economists use all sorts of questionable math to come up with those numbers. Remember the old joke: "Economics is the only field in which two people can get a Nobel Prize for saying exactly the opposite thing."
If prices start to fall, why wouldn't they fall to the point where Average Joe can afford an Average House? Can you name a reason, even one pulled out of your ass, why prices in Bend would hover above a point where the median income can afford the median house?
The answer, my dear BEM, is that there is no law (natural or man-made) that says houses need to be affordable to people making the local median income (in Bend or anywhere else). In fact there are plenty of places where median income folks can't afford houses. Have you been to Europe lately? Housing in Germany and France is even less affordable to the average middle-class person than in the U.S. -- I know French and German families who have moved here and been able to buy houses they couldn't have bought at home.
The trend during the Bush years has been toward greater disparity in wealth in this country. More people in the lower half of the socio-economic spectrum are getting shut out of housing, health care and higher education. Will the trend reverse and housing magically become more affordable while everything else gets more expensive? It seems unlikely, but anything is possible.
BEM,
While I find most of your comments and observations regarding the bend RE market insightful, I think your prediction about medians dropping to $180K is off base. That's 3 times median income, and according to BendBust, the rule of thumb is 4X income...so, the proper median should be $240K...which I think we will hit, no problem. To predict lower than that is also pulling numers out of your ass...besides, your track record for predictions is not too good. On your old blog, you swore and down that Bend would see - 30% by the end of 2006....waaaaay off.
That's 3 times median income, and according to BendBust, the rule of thumb is 4X income...so, the proper median should be $240K...which I think we will hit,
What I said about 4X is its what landlords use and bankers use.
We dont' give a fuck about renters or buyers.
When sellers go to sell they had better look at what a sucker can get from a bank, and historically that is 4X. You can ASK all day for more, but that's all your going to get.
Given that wages will probably fall now that the RE related jobs are gone, and that is 75% of BEND. Perhaps 'X' will fall to $40k, then the amount the average sucker could get would only be $160k.
Given that wages will probably fall now that the RE related jobs are gone, and that is 75% of BEND.
What a bunch of BS. Real estate and construction aren't anywhere near 75% of the Bend economy. Try closer to 15%.
The answer, my dear BEM, is that there is no law (natural or man-made) that says houses need to be affordable to people making the local median income (in Bend or anywhere else). In fact there are plenty of places where median income folks can't afford houses.
First of ALL medians don't mean shit, they're just a game that RE plays with your mind.
All that matters is average price sold for a specific area vs sq-ft, and the std-dev.
In my hood people were asking $400k last year, now they're typically asking $300k, and still nothing is hardly moving. It will not be long before we're at $240k for ask. Note, my reference is 1200-sqft west side cottages.
The median is bullshit, we have killed that dead horse. All you can possibly discuss is area, sq-ft, price-sold; compute the average and std-dev for comparable property's.
The median takes into account a bozo bought a $5M hill house at Highland@Broken who gives a fuck, that is irrelevant.
What a bunch of BS. Real estate and construction aren't anywhere near 75% of the Bend economy. Try closer to 15%.
Less government, there is hardly a person in Bend that isn't riding the RE horse, and most of government is riding that horse also.
The largest employer in Bend in total is fast-food, and they're #1 customer is construction. If construction died, then all of I-97 car-lots would die.
This town is easily 75% dependent on RE. Its the blood of this two horse town. If this were a gold-town RE would be the gold, and when the gold plays out, folks move on and the town becomes a ghost town.
Median for Detroit is $159,900, according to this website.
This is exactly why the median is bullshit.
There are ton's of $30k homes in Detroit, but there is also the OLD BIG-HOSS-PIG rich mans area.
So by using median you take the middle of the $30k homes, and the $10M legacy homes, and you get $159k, which tells you NOT a fucking thing.
All that matters is the average price for an area, and the std-dev.
Realtors NEVER mention avg's or std-dev because they're idiots. If you asked them to mathematically define average & median 90% would tell you its the same thing.
It's no longer possible to build 2000' houses in Bend for $180,000 (land + labor + materials) so there's no way median prices will ever go down to anywhere near that level.
This is a good thing. You all have small-mans-dick syndrome, and must make it up in the house.
A house is the cottage, and the best sq-ft is 1100sq-ft, recall that heat is going to go up ten-fold in the next few years. This is the desert.
Let's call it 1000sqft, and @180k that $180/sq-ft, which is damn near $200.
Besides, another variable, and you all know this to be true, that ALL homes are going to be MADE in china, and assembled here. People will be buying 'home-kits', just like they did turn of the century via catalog.
The 2000-sqft PIG house for man with small dick is over.
Take it from someone who's lived here for more than 20 years: The assholes were always here. The real estate boom just gave them more scope in which to exhibit their assholeishness.
So true, there is a saying "money changes everything".
Give a boss-hog or a high-school cheer leader a little money, and you get franklin-crossing, give a high-school-quarter back a pick-up, and you get nwxc,
Homegrown, but that said, the cali money is that what enabled them.
If construction died, then all of I-97 car-lots would die.
Bendbust you are a californicator through and through. It is US 97 yep that's right a US highway not an interstate like everything in Cali. You claim 40 years here more like 40 minutes. You're an idiot.
Welcome to Bend, where the cops are not just assholes but legal killers also.
Selective killing. You will not see them kill the spawn of Mrs. Breeze,
Given that wages will probably fall now that the RE related jobs are gone, and that is 75% of BEND.
What would a Bend without RE and RE related biz look like?
Take away RE, and construction, and all the related home-depot, ... services,
There is NO bend-bubble. The problem here is drive-by blogging. If we could eliminate blogging, then tomorrow nw-xc homes would be ALL selling for $1M.
Have you been to Europe lately?
Ich Ein Nazi! Sieg Heil, Sieg Heil
Our RE bitch has solved the problem, we start sponsoring "NAZI days" in bend, and have a parade where we chase jews through the street.
All the while we have our RE whores tell our good germans that our RE is much cheaper than their RE. Also germans love sun. Be sure to tell them we have sun.
This is kind of out-of-the-box thinking we need here, in order to get out of the bubble we must find someone who thinks our RE is affordable.
The reason that places like germany are expensive is that they have ran out of land, and familys keep RE in the family. In Italy a home can cost millions, and frequently children don't get their own home until 40. What in the HELL does this have to do with Bend? We're out in the fucking desert, and we have tons of land.
Given that wages will probably fall now that the RE related jobs are gone, and that is 75% of BEND. Perhaps 'X' will fall to $40k, then the amount the average sucker could get would only be $160k.
DO any of you geni-asses think that wages are going to go up?
Do any of you geni-asses think that losing ALL RE related biz will NOT effect bend?
The 2000-sqft PIG house for man with small dick is over.
We can always count on Bendbust to elevate the discussion. ;-)
But he's out of touch with what real people want. People vote with their pocketbooks, and they're voting for 2000sf houses.
"The average new house has expanded in size from about 1500 square feet in the mid-70s to over 2000 (Friedman and Krawitz).. People want more space -- family homes have grown by 1/3 in size over the last twenty years. Sizes of lots are decreasing, as sizes of homes are increasing. The median size for a new single family home in 2003 was about 2300 square feet (National Association of Home Builders)."
People vote with their pocketbooks, and they're voting for 2000sf houses.
sqft sells for a lot of reason, the #1 reason is ego, but notice this is simply an example of the excess, and also easy-money.
you yourself was bitching that bem was full of shit that there were going to be no 2000sq-ft house for $180k, nobody said there was, the assumption had always been 1000sq-ft homes, e.g. cottages
The assumption for your shevlin, and other siberian tracts that ALL the people want, will most likely turn to shit, as they were built to NOT last.
Also I noted from my most recent walk in NWXC they're starting to build small homes now ...
We're always bashing 2000+sq-ft houses here.
Fuck this median thing, it don't MEAN SHIT, most of the houses at highland@broken-top are 10K-sqft, whats the fucking point.
NAHB and NAR just full of shit with their metrics.
People buy big houses because of ego, but as has been clearly written here today, a lot of people bought shit they cannot afford.
My point is that unless you have a 1000sqft home, you'll NOT be able to soon pay the heating bill
Then folks with cottages will look smart.
Look at BIG cars people want that too, until gas goes up, now nobody wants BIG cars, it will be the same with BIG homes,
Lastly, did I mention that MEDIAN doesn't mean shit.
What in the HELL does this have to do with Bend? We're out in the fucking desert, and we have tons of land.
In case you didn't bother to read the comment before starting your rant, what it has to do with Bend is that there's no God-given law mandating that houses have to be affordable to median income people. Europe was used as an example of non-affordability, but there are certainly plenty of examples closer to home. Maybe you think what happens in the rest of the world doesn't apply to us here in the USA (just like George Bush).
Also, didn't IHTBYB try to convince us there's a shortage of land here in Bend and the city needs to expand the UGB more than the current plan calls for? Tons of land or shortage -- make up your mind.
you yourself was bitching that bem was full of shit that there were going to be no 2000sq-ft house for $180k, nobody said there was, the assumption had always been 1000sq-ft homes, e.g. cottages
Really? Does anyone else agree with Bendbust's assumption? Will American families stop living in 2000sf homes and return to 1000sf cottages anytime soon? (I didn't think so.)
My point is that unless you have a 1000sqft home, you'll NOT be able to soon pay the heating bill
Umm, hate to point this out but many of your beloved cottages are energy dinosaurs -- drafty and lacking insulation. Modern 2000sf homes with good insulation cost less to heat than those old 1000sf places.
Umm, hate to point this out but many of your beloved cottages are energy dinosaurs -- drafty and lacking insulation.
In the day all Bend cottages sat on river rock, and had no insulation.
My little cottage I live in has R20 in the wall's this little puppy is like an adobe.
I think almost ALL the cottages have been upgraded in Bend from the days that you had wood on rock, and wood walls with loose windows. Very few of those homes around.
All things being equal, a 1000sqft home is cheaper to heat than a 2000sqft home.
During a depression the BIG houses fall the worse because BIG costs more, just like a boat when the house doubles the volume cubes, I know this is over your head, but when things are big the costs are higher.
In case you didn't bother to read the comment before starting your rant, what it has to do with Bend is that there's no God-given law mandating that houses have to be affordable to median income people.
The average income of a Bend family is $60k/yr.
There is NO such thing as a fucking BEND median income. How fucking stupid are you.
Lets play your game.
Most people in Bend make $7/hr, but there is a guy at highland@brokentop that plays basketball for $50M/yr.
Ergo the Median income in Bend is $250/hr. This is fuck irrelevant.
All that matters is average. Everything in life is about averages. Quantum-Mechanics is about averages.
There is NO such thing as MEDIAN-electrodynamics, or median-mechanics.
What matters is what average people make, because MOST people are average.
You are either a stupid realtor, or a complete imbecile.
There is NO such fucking thing as median income people.
Perhaps RE can pull a median home price out of their ass by picking the mid point of the highest fucking house in Bend and the lowest. But this doesn't tell you a fucking thing about the market, or what's really happening.
"In probability theory and statistics, a median is a number dividing the higher half of a sample, a population, or a probability distribution, from the lower half."
Given that the highest paid person in Bend that I know of make $50M/yr, what in the hell does this have to do with someone that make $15k/yr { $7/hr )
Why do we even care about the high end, they have nothing to do with affordable homes in Bend.
just another comment from a dirtbag mortgage broker who loves this site and the comments of most of the posters here...
we managed to kill senate bill 965. It got referred to committee where it died as of yesterday June 25, 2007. It got referred because the sponsors knew it did not have the votes to pass the house.
it did not have the votes to pass because we lobbied hard to kill it. Good job...
Anyway....enough with consumer protection...now how can we buy some houses in the new up and coming water park from some dirtbag developers and tie up all the houses.
Then we can sell them to idiots from california who will be backward forever in them.....
come on...I know you guys know who will be selling these debt traps....please tell me...i am stuck in hawaii....
There is NO such thing as a fucking BEND median income. How fucking stupid are you.
You know what, you're asking the wrong guy. You'll have to ask BEM how fucking stupid he is because he's the one who introduced the term "median income" in his comment starting "I think you are dead wrong."
By the way, how fucking stupid are you that you don't even know to put a question mark at the end of a sentence when you're asking a question?
Most people in Bend make $7/hr, but there is a guy at highland@brokentop that plays basketball for $50M/yr.
Ergo the Median income in Bend is $250/hr. This is fuck irrelevant.
The funniest part of this is that you diss real estate people for not knowing the difference between median and average when you don't even know the difference yourself.
Definition of median: One type of average, found by arranging the values in order and then selecting the one in the middle. If the total number of values in the sample is even, then the median is the mean of the two middle numbers. The median is a useful number in cases where the distribution has very large extreme values which would otherwise skew the data.
Let's take your hypothetical example where most people in Bend make $7/hour and one person makes $50M/year. The one rich guy's wage is offset by one poor guy's wage and doesn't affect the median at all. In other words, if 10 people lived in Bend and nine of them made $7/hour and one made $50M/year the median would be $7/hour. It's a simple concept, but one you apparently haven't figured out even though you post about it ad nauseum.
When you write "Ergo the Median income in Bend is $250/hr", you're describing an arithmetic average (or mean) where a single ridiculously high number skews the result. Here's a page where you can learn more (if you're open-minded enough to realize that you don't know it all already):
http://mathforum.org/library/drmath/view/58326.html
I love bendbust every village needs an idiot and even our blogger village has one.
how fucking stupid are you that you don't even know to put a question mark at the end of a sentence when you're asking a question?
Edumacation was not bendbust's strong suit or maybe he just has something against English, spelling and gammar in general.
Party on in the trailer park bendbust we love your idiotic rants.
The median takes into account a bozo bought a $5M hill house at Highland@Broken who gives a fuck, that is irrelevant.
Uhhhh... like, that's... uhhh wrong.
There is NO such fucking thing as median income people.
Uhhhhh...
Most people in Bend make $7/hr, but there is a guy at highland@brokentop that plays basketball for $50M/yr.
Ergo the Median income in Bend is $250/hr. This is fuck irrelevant.
Uhhhh heh heh.... uhhhhh. Heh
"In probability theory and statistics, a median is a number dividing the higher half of a sample, a population, or a probability distribution, from the lower half."
I've noticed a certain correlation between these sorts of rants, and the end of BBC's happy hour. I guess I'm just glad that "sample", "population", and "probability distribution" were properly distinguished from each other. Whew.
OK dude, when your hangover wears off: A median is the middle observation in a string of numbers that have been ordered smallest to largest (or vice versa). "Dividing the higher half from the lower half" is like... not even really a mathematical operation.
It's more like segregation. Are you a math racist?
RACIST!
It's OK. I posted to BEM's blog pretty damned buzzed a few times. He gave me the Ramses treatment though:
STRICKEN FROM EVERY TABLET.
STRICKEN FROM EVERY SCROLL.
STRICKEN FROM EVERY OBLISQUE.
And all I wanted to do was enslave the population of Burns. Holy Moses. Good times. But as you said:
This is fuck irrelevant.
Ich Ein Nazi! Sieg Heil, Sieg Heil
Our RE bitch has solved the problem, we start sponsoring "NAZI days" in bend, and have a parade where we chase jews through the street.
Reading the puerile putrescence Bendbust spews on this blog brings to mind the "white trash" he likes to rant about. As they say, the faults we put down in others are often the faults inside ourselves.
Quantum-Mechanics is about averages.
DAMN! I'm a QUANTUM PHYSICIST! Freakin' sweet. I am so going to gun for that raise at work.
Dude, seriously, try not to rant on after happy hour! It chinks away at your impenetrable armor of logic. I think I speak for everyone, when I say of course we're all in FULL SUPPORT of your Realtor-sponsored "Nazi Day"; really, I'd goosestep my kids there, we could have kiddy swastika tattoos, dig mass graves, melt down some fillings and maybe even make some human hair purses.
But when you don't know what the hell a median is, or speak in coherent sentences, it just puts a damper on the works. If Hitler taught us anything it's that regular people will not follow a nutjob.
The Germans, that's a different story. Those crazy bastards will do anything to get their hands on France and kill ever' last one of those stuck up bastards. Them and the Jews.
ZEEK HEIL! Where are you Hitler! We need you now!
Long live the Doh man, notice I said Doh man not Doh boy....! You rock your commentary on our fellow blogger bendbust-a-nut (I know how much he loves to hyphenate stuff) is nothing short of hysterical. Dude if I knew where you lived I would bring over a couple of coldies you deserve them :-)
You really need to take that show on the road, the best part is you can't make this stuff up that's what's so dang funny.
I say of course we're all in FULL SUPPORT of your Realtor-sponsored "Nazi Day";
Then its a done deal. Let's make it happen. We need Duncan.
He's the only one with organizational skills.
Does Bend have Jews? We have to run Jews through the streets. Do we have to bus them from Portland?
"Everyday is Nazi Day in Bend"
"Come to Bend, Where every Retarded White Man is a King"
He'll we'll be more famous than Sand-Point, Idaho.
A median is the middle observation in a string of numbers that have been ordered smallest to largest (or vice versa). "Dividing the higher half from the lower half" is like... not even really a mathematical operation.
2,2,2,2,500
The median is 250
The average is 101
Using the Median skews the result towards the high end, if MORE samples are taken and the average is used, your would eventually converge on '2' the true average.
Where the majority of numbers are low, say $300k, then the average will converge toward that number, even if there is a high number like $5M up in Highlands@broken-top.
A Median makes things weight towards the high end. Which is irrelevant. We don't give a fuck about the high end. It has nothing to do with those who live in the lowlands.
A median is the middle observation in a string of numbers that have been ordered smallest to largest
2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2
,2,2,1000
Median is 500
Average is 55,
Note as the samples increase we slowly converge on the important number '2', the median tell's us NOTHING.
In this case a '2' represents little cottages sold in Bend, and the 100 represents an estate sold at high@broken-top. Given that the average person is a '2', the high end is of no concern to anyone, thus its a fucking waste of time.
Let's not lose our mission here in our zeal for Nazism. The goal was to convince Germans who are used to crowding and high prices to purchase RE in Bend.
I fear that the goal has been lost, as people to quickly saw this as an excuse to unleash Bend's inherent Nazi culture in the name of RE marketing.
2,2,2,2,500
The median is 250
Bendbust, you still don't get it. Repeating your mistake over and over doesn't magically make it right.
I'll give you a hint, the median of the five numbers you listed above is a single-digit number and it's between 1 and 3. If you still can't figure it out let me know and I'll give you more hints.
By the way, how fucking stupid are you that you don't even know to put a question mark at the end of a sentence when you're asking a question?
How stupid are you to recognize a question without an explicit question mark ? { MA }
{ In chinese you always end every sentence with 'ma' when you want a response, perhaps I didn't want a response? }
"2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,2,1000
Median is 500
Average is 55"
Ummm, no. Look it up dumbass.
To find the median for the numbers listed above, go to:
http://www.easycalculation.com/statistics/mean-median-mode.php.
As you will see, the median is .....2!!!!
Amazing how stupid this guy is.
You know what, you're asking the wrong guy. You'll have to ask BEM how fucking stupid he is because he's the one who introduced the term "median income" in his comment starting "I think you are dead wrong."
It's fairly apparent the problem here is science versus MBA. If this were a fucking pre-school then you can median for instance say we're in Bend and you have ten stupid white kids and one genius, ..
F,F,F,F,F,F,F, F, F, F, A
{ I'm assuming you have enough algebra to know that F=0, and A=1 }
The average would skew toward 'A', which makes the school look bad,
But the median skews towards 'C', which makes the school look good.
Its the same for our HO's here, they use the term median either out of stupidity, or they use it to specifically cover up bullshit.
The establishment uses the 'median' to make the system look better than it really is. What we need to do is only consider the low-end averages of like property, and LIKE income.
WRT to BEM, I have no fucking idea of what really thinks, we know duncan and IHTBYB pour their hearts out here, but the rest are a big question mark?
WRT to median-income I think its a stupid fucking concept.
I'm a physicist, and we only deal with averages ALL science today is about averages. Quantum-Mechanics which is the basis of all modern science is just averages. There is NO notion as Median Uncertainty Principle.
Normally in scientific experiments when you have large numbers that have nothing to do with a data-set you ignore them. We call spurious information. What is important is trends of the predominate data-set.
Like our Bend income, we know the average family income is about $60K/year, but the fact that a bunch football & basketball players make that much a night has nothing to do with what the average man/woman in Bend earns.
So the average family income is $60k/year, but the MEDIAN is probably $25M, doesn't that really tell us anything about Bend? Given that a few people up at Highlands@broken-top fetch $50M/yr playing with balls?
Amazing how stupid this guy is.
Give poor Bendbust a break -- being right about everything all the time when everyone else is wrong is a heavy burden for him to bear. Plus he's apparently writing his posts in Chinese and translating them into English so that explains a lot too.
If Hitler taught us anything it's that regular people will not follow a nutjob.
Huh?
I think DUBYA resembles that remark.
I'm a physicist ... So the average family income is $60k/year, but the MEDIAN is probably $25M ....
Yikes, what do they teach these physicists in college?
Let's take bets on how long Bendbust can keep getting the median wrong.
Rather than Germans. We should be attracting Mexicans.
Here is the proposal. Forget about the Redmond Water-Park.
Let's have a Bend Bull-Fighting-Stadium.
We'll have Mexicans from all over the west. We can advertise Bend as the only bull fighting in North-America.
Mexicans have a positive net worth, unlike the gringo.
Tired of Blogging, Are you Bored? There is an alternative.
Adolescent boredom, the leading cause of surliness in teenage males and the third most common cause of unwanted pregnancy in females under the age of 16, has baffled doctors for decades. As recently as 1997, medical researchers almost universally regarded the condition as incurable. Yet, according to the new report, even a small quantity of glue, when inhaled, can alleviate many of the most debilitating effects of adolescent boredom, including introspection, awareness of the passage of time, and consciousness.
"The glue worked great—I hadn't felt so little boredom in years, mainly because I wasn't aware of my surroundings, peers or self," said study participant Ryan Jenkins, 14. "The only downside was, when I woke up behind the Dumpster, like a couple hours later or something, I had this splitting headache. Oh, and somebody stole my shoes. But other than that, it was the bomb."
I'm a physics.
When I was young physics were things that people put up there ass. Sort of like taking an oral laxative, or a coffee enema.
Perhaps what bendbust is saying is that he is a proctologist.
What is the 'median' income in Bend?
According to wikipedia:
In 2006 the median income for a family of four in Bend, OR, is $58,800.
Note, it uses that awful term MEDIAN....which we all know means NOTHING!!!!
Especially if you are a physicist/major landlord with TONS OF PROPERTIES THROUGHOUT THE NORTHWEST living in a mobile home park who has lived in Bend 40 years!!!
Oh my God, you killed Kenny!!! You bastards!!
Ok all, CACB reports its quarterly results in about 3 weeks. Will they make their numbers or not? The analysts expect 34 cents per share net income. If they miss it, the stock will drop. The analysts set their expectations a few months ago. Whats your prediction?
-CACB Shorter
Let's not lose our mission here in our zeal for Nazism. The goal was to convince Germans who are used to crowding and high prices to purchase RE in Bend.
I fear that the goal has been lost, as people to quickly saw this as an excuse to unleash Bend's inherent Nazi culture in the name of RE marketing.
Can't we have both? If Californians have taught us nothing, it's:
You CAN Have It All!
The analysts set their expectations a few months ago. Whats your prediction?
Well everyone here knows they can take my predictions to The Bank. And leave them in the toilet. Those bank toilets can flush down anything.
But... that said, I think that general inflation here could make things look just fine. 9% yearly inflation in Deschutes County could make earnings look great at CACB.
But RE volumes have been cut back over 30%, and builder loans cannot be getting turned at the rate they were a year ago.
The pressure to "make the numbers" is incredible, and always seems doable in the early stages. I still think CACB will be a proxy for subprime, but Moss & Co could artificially delay it for months or years.
They'll probably come in close, or just below. And then will commence the breathless explanations about the "one time" events that caused the shortfall.
I would actually think the stock is more of a buy if Moss comes straight out on a shortfall & admits the market has gone to hell. Then at least you know you don't have a Kool-Aid addled liar running the show. I would look at what Moss says to explain a shortfall if any. And if they DO hit the numbers... man, something would be seriously weird about that, given what we KNOW about what's happening here...
CACB reports its quarterly results in about 3 weeks. Will they make their numbers or not? The analysts expect 34 cents per share net income. If they miss it, the stock will drop. The analysts set their expectations a few months ago. Whats your prediction?
My prediction is that the biggest surprise will be balance sheet news rather than earnings news: continued deterioration of their loan portfolio.
And I also think that their origination volume will be down, unless they're sacrificing borrower quality even more. It is hard to imagine that CACB's loan approval people are seeing a lot of projects they feel confident lending into.
I predict that by the end of the third quarter CACB stock price will have drifted below the psychologically significant $20 barrier even if there is no particularly bad news. I think this will happen because of negative sentiment about community banks in general and realization that CACB is in for a long slog just to maintain past gains (let alone achieve growth) because of problems in its home markets, no matter how well-run it is.
I think that CACB will hang out between $16 and $21 for a couple of years and it will drop off the radar of national analysts for a while.
Forbes isn't helping any.
http://www.forbes.com/business/2007/06/26/home-ownership-negatives-biz-dream0607_cx_ee_0626house.html
In 2006 the median income for a family of four in Bend, OR, is $58,800.
Note, it uses that awful term MEDIAN....which we all know means NOTHING!!!!
**
What is the average income? I know we have been quoting $60k/yr forever here.
I think we can all now agree what is meant by median, range, mid-range, average, and std-dev.
The exercise yesterday was quite useful.
It would also be useful to start providing some raw numbers with these statistics.
My concern is that there is always NAR median for Bend, and then there is the CNN median, ... Everyone seems have to their own median.
Now that we have defined how to calculate a median, perhaps the number will become more consistent. At least in this forum.
I noted today in the Bulletin that Summit High needs $7M to fix the yard.
Seems like they built everything on volcanic ash. As someone who bikes up there everyday I have been watching NWXC wash away during every rain, and of course watching Summit High wash away.
The number of 'water-damage' related lawsuits around a 1 mile radius of Summit-High is quite interesting.
You would have thought that given the special marketing done for this area that someone would have pointed out that if you build a house on sand, that during the first rain it will wash away.
I hope hope that the School District doesn't have to pay twice for the yard.
When you go up Galveston towards Summit-High, notice on your left that all those houses are also washing away.
Perhaps there is a reason that historically nobody built much West of West-17th,...
If median ever hits 180K I'll swipe up a couple more houses. Oh wait. So will everyone else, which is why it won't ever get that low again.
The median income for a household in the city was $40,857. Note that given that teh median income of Bend is $40k, and using the 4X rule, this means that bank-finance generosity should be $160k, we'll below the $180k suggested by IHTBYB.
I think this why I really like talking about 4X WRT being a land-lord or banker. We really don't know what 'X' is-is.
What we do know is that a typical $40k/yr person doesn't need a 2000+sqft mcMansion in Siberia. Just a simple little Bend cottage of 1000sqft at the affordable price of $180k. Given that typically the bank will loan $160k, and the person must pay $20k down, I think the $180k for inner nice little homes will be quite reasonable post-bubble. For a long-long time.
***
Since I guess we're going to treat wiki as god here, note that they say the median income is $40k, and note that from my point of view the family of four here is a rare bird.
Read the below carefully, yesterday we learned how the median is computed. Today we can determine what the median-income really is. Perhaps then we can determine what the median house price will be at the trough of the bubble.
***
There were 21,062 households, out of which 31.9% had children under the age of 18 living with them, 50.2% were married couples living together, 9.7% had a female householder with no husband present, and 36.4% were non-families. 26.1% of all households were made up of individuals, and 8.6% had someone living alone who was 65 years of age or older. The average household size was 2.42, and the average family size was 2.92.
In the city, the population was spread out, with 24.5% under the age of 18, 10.2% from 18 to 24, 31.1% from 25 to 44, 21.9% from 45 to 64, and 12.4% who were 65 years of age or older. The median age was 35 years. For every 100 females, there were 97.1 males. For every 100 females age 18 and over, there were 95.6 males.
The median income for a household in the city was $40,857, and in 2006 the median income for a family of four is $58,800. Males had a median income of $33,377 versus $25,094 for females. The per capita income for the city was $21,624. About 6.9% of families and 10.5% of the population were below the poverty line, including 13.8% of those under age 18 and 5.8% of those age 65 or over.
It's almost happy-hour AGAIN...
On the subject of Beer & happy-hour; What is Best of Bend?
mon deschutes
tue bend-brew
wed cascade
I'm more and more liking silver-moon, always have $3 pints, and $6 for a gerry. Nice people, no calis.
The place that sucks is cascade, its like chuckee-cheese, its all cali's. I really like the cascade in Redmond, it has meth people, cowboys, and working folk, all with their own areas. Good pub food.
Deschutes is still the best for food, but always so crowded.
In summary silver-moon is the best, and good music also.
If median ever hits 180K I'll swipe up a couple more houses. Oh wait. So will everyone else, which is why it won't ever get that low again.
If a house meets my criteria I'll buy at $250k.
That criteria is ...
Off-street parking, 1/4 ac lot, old trees, nice 1200sqft house, fenced, big-garage, parking for RV off-street; 5min walking distance to Deschutes Brewery or Newport MKT.
These make perfect rentals, and for $50k down, I can make them pencil and rent them all day long.
The problem, and this is the BIG IF, and has been widely discussed here is that There are VERY few people in Bend or in PDX that have the money, credit, and knowledge to do this.
The fact is things are already down, and they haven't moved in to buy, there are lots of people desperate to sell. The WHOLE problem of course is that the EASY-MONEY is over, and most people don't have 20% down in cash.
As we know by now the average American has a negative saving's rate. One factor thats NOT in our wiki overview of Bend is the average amount of CASH on hand that people have.
Given that the median income is $40k, my guess is the CASH on hand is close to zero, because as we all know $40k is living paycheck-to-paycheck.
Thus the number of people who can speculate on property is very-very few.
Sure there will be some shitholes in time that go down to $180, but the home I defined above has always been in short supply.
What has always been plentiful is little shacks with no off-street parking. A person in Bend needs off-street for his RV, and a garage for his toys. Otherwise what is the point of living here.
We used to say, if you can fly, float, or fuck in it, then rent it. Perhaps those days are returning?
***
Don't Buy That House
Elisabeth Eaves 06.26.07, 6:00 PM ET
The dream of owning your own home is as American as apple pie--and (supposedly) better for you. Over and over, we are told that homeownership will make you happier, healthier and wealthier. Heck, it's even supposed to make you a better citizen.
Of course, there are times when, depending on your age, your savings and your income, buying a home can be a smart decision and an excellent way to build wealth. But is buying a home really such a universally good idea?
It's hard to separate fact from propaganda.
Certainly, the virtues of ownership have been preached loudly and from on high. As early as the 1920s, Herbert Hoover extolled home ownership as a pillar of family life. Nearly 80 years later, President Bush reiterated the message, stating "there's no greater American value than owning something, owning your own home and having the opportunity to do so."
Homeownership has been touted as civic responsibility, "moral muscle" and a bulwark against communism. A 1922 pamphlet from the National Association of Real Estate Boards even promised that it would put the "MAN back in MANHOOD." Over the years, it has been claimed that homeowners vote more, join more voluntary associations, take better care of their residences and have better-educated kids.
But to realize that America's mania for home-buying is out of all proportion to sober reality, one needs to look no further than the current subprime lending mess. In the last decade, riskier lending practices combined with historically low interest rates and federal subsidies have encouraged a wave of low- and moderate-income households to buy homes.
As interest rates--and mortgage payments--have started to climb, many of these new owners are having difficulty making ends meet. At the moment, a record 250,000 mortgages are in foreclosure--that works out to more than 0.5% of the entire U.S. mortgage market.
Those borrowers are much worse off than before they bought. "There's the loss of the initial investment, ruined credit ratings and the psychological trauma associated with foreclosure and being evicted," says William Rohe, co-editor of Chasing the American Dream and a professor of urban studies at the University of North Carolina at Chapel Hill.
Worse, foreclosures are often concentrated geographically, meaning that neighborhoods that were already badly off now have even more abandoned properties. Conversely, ownership can trap a family in a declining neighborhood, while renters move on more easily.
Steven Bourassa, a professor at the School of Urban and Public Affairs at the University of Louisville, recalls attending a speech in which the mayor of a Kentucky town was bragging about expanding homeownership. As an example, the mayor cited a disabled woman with an income of $8,500 a year who was able to acquire her own home with the help of a federal voucher program.
"I think that's nuts," Bourassa says. "She can afford the mortgage payment, but what if something goes wrong with the house? Some of these people would be more stable if they had just stayed in the rental sector."
Even for the better-off, buying isn't always a good idea. For some, moving from the city to the suburbs has high psychological costs. People in the suburbs can feel more isolated and less involved in their communities. Longer commutes take a toll. Taking care of a home takes time, money and energy. New homeowners need to be ready to trade in existing hobbies for lawn-mowing and trips to Home Depot (nyse: HD - news - people ).
And, practically speaking, it's fairly obvious that homeownership isn't right for everyone at every stage of their lives. Downsizing retirees might be better off selling their homes, investing the cash to generate income and moving into low-maintenance rentals. And young people who need mobility for their careers can end up feeling hamstrung by the inability to sell quickly.
What about all the social benefits attributed to homeownership? It turns out that many of the supposed benefits of ownership are likely due simply to family stability, for which homeownership is an excellent proxy.
For instance, while it is true that the children of homeowners have scored better on standardized tests than the children of renters, there's little to suggest that ownership per se is the cause of better performance.
"Some research has suggested that it isn't whether parents own or rent, but the mobility of the household," says Rachel Drew, a research analyst at Harvard University's Joint Center for Housing Studies. In other words, it's likely that families who stay in one place for a long time (renting or buying) are doing better by their kids than families that move often.
"All of these things we say are benefits of homeownership in the U.S. I think would also be benefits of long-term rental tenancy," says Bourassa.
Certainly there are plenty of stable, wealthy, well-educated places in Europe, at least, where homeownership is far rarer than it is in the U.S. Nearly 70% of all Americans own their own homes; only 34% of the Swiss do. Thriving cities like Hamburg, Amsterdam and Berlin have rates of ownership of just 20%, 16% and 11% respectively, according to the United Nations.
So if something in your gut--or on your bank statement--tells you that now is not the right time to buy, resist the pressure. There may be no place like home, but there's no reason you can't rent it.
Perhaps there is a reason that historically nobody built much West of West-17th...
One thing is absolutely for sure, and that is that a good chunk of Northwest Crossing was built on a huge open-pit pumice mine (in Bend parlance, "pummy pits." Probably no more than 5% of the people buying there know what pumice is, let alone which parts of NWX are in danger of damage from settling. I happen to know where at least some of the pumice is because I am from Bend and I used to go out there before Northwest Crossing existed, and huge cutaways showed the layers of pumice just east of where High Lakes School is. The pumice is at least 100 feet thick in some places; it would cost millions of dollars to fix it. West of NWX on undeveloped Miller property are a few more, even bigger pummy pits.
Don't believe me? The map on Google Maps is just the right age to show it - you can clearly see a few oval-shaped treeless areas just to the east and southeast of High Lakes School. Those are filled-in pummy pits.
The upside of being built on pumice is that you have fewer insect problems. Pumice is incredibly abrasive - it's a mixture of volcanic glass and air. Bugs don't like to crawl around in it. The downsides are the settling, the asbestos-like stuff getting into your nose, having to buy and install topsoil if you want a yard and so on.
.
LINK TO EUROPEAN RESPIRATORY JOURNAL
By the way, above is a link to a medical journal article reporting on an Italian study showing a 29% incidence of lung lesions in people chronically exposed to pumice dust. Should be required reading for anyone considering moving their family into a home built over an old pumice mine.
"The difference with silicosis may be explained by the mild cytotoxicity exerted by pumice on alveolar and interstitial macrophages and on mononuclear phagocytes; pumice powder accumulates into the cells without causing their necrosis, which is responsible of the release of interleukines and other mediators provoking fibrosclerotic reaction. Consequently, pumice powder, both free and contained in macrophages, follows an efficient lymphatic drainage towards pleural membranes and mediastinal lymphnodes determining a chronic fibrosis only after overcoming a threshold limit of dust deposit. This mechanism may explain the relative clinical mildness and long evolution of liparitosis.
By the way, above is a link to a medical journal article reporting on an Italian study showing a 29% incidence of lung lesions in people chronically exposed to pumice dust. Should be required reading for anyone considering moving their family into a home built over an old pumice mine.
You have just defined almost all of Bend one mile east/west of the river. As soon as you get away from the old alluvial river bed, then its almost all pumice dust, except for the sand over towards the badlands.
In Poltergeist they built tract-homes on mummy pits,
In NWXC they built tract-homes on pummy-pits,
Either way we know how the story ends.
If you go explore all the area of NWXC and Summit-High, you'll see huge erosion washes some ten feet deep and ten feet wide, and often caused by a single rain. Towards the south side of Galveston on the way up to Mt-Washington drive on the left, walk on south side jog path, and look up, almost all the homes now have rip-rap, or they have completely lost all the topsoil.
I don't know which is worst building a house-of-cards on a bed-of-sand, or a bed of pummy.
What have we heard about rectification? I know at NWXC everybody is suing everyone over the flooding and erosion. Will the folks that made the 'yard' at Summit be held responsible? It sounds like Bend Schools is just passing another $7M expense on to the public, it sounds like an excavation company changed its name, ...
.
ANOTHER FUN PUMICE FACT:
A big reason why pumice beds erode so fast is because pumice floats. That's right: a rock that floats.
OK now imagine a heavy rain. It's bad enough when non-floating rocks and soil get washed away by moving water, right? Now imagine that in the presence of water (whether moving or not), the rocks and soil unattach themselves from the earth and float to the top of the water.
Yeah I don't know what they were thinking building so many houses on pumice beds. Oh, that's right - they were thinking $$$$$$$$$$$$$ ha ha suckazzz!!!
Geez... The Bulletin put out a 1 - 2 punch today:
Affordable condos downtown?
Regional income ranks low
In short, the so-called affordable downtown condos, Lava Court, well, there's been a change of plans: they're going to sell them as condos. Hey! Surprise!
And when they approached the City, who sold them the land for rock-bottom below market pricing for approval for their plan, what did they say?
“That’s one of the reasons that I’m really supportive of this project because there simply isn’t a supply of affordable condominiums,” Councilor Linda Johnson said at the urban renewal board’s meeting June 20. “The fact that it’s a change from the original concept doesn’t trouble me at all.”
Seriously. That's a QUOTE from a Bend city Councilor! There's more:
A planned affordable housing project in downtown Bend is getting a makeover before construction even starts..
But Housing Works, a Redmond-based corporation, and the building’s developer said last week that construction costs have spiked 20 percent in the past year, bringing the cost of the building to more than $12 million
Nice. They haven't even started building yet, and "construction costs" have gone up 20%. I know they really mean "anticipated construction costs", but can they at least break ground before they BEND us over a barrel? Yet another butt-spanking of City taxpayers that had the FULL SUPPORT of City councilors (except Jim Clinton). Not just support, but they're practically giddy.
This is just beyond words.
The next article illustrates that, adjusted for inflation, Deschutes County "yearly average income" (whatever that means) is up 14% since 1990, BEHIND Oregon as a whole & the U.S.
Hmmm... I seem to recall telling several commenters that when prices for goods are up in excess of incomes, that there enters a certain component of MISERY into peoples lives.
So... do you think Deschutes home prices are up 14% more than inflation over the past 17 YEARS? Maybe? Just a little?
Right, this basically tells me that real incomes in Deschutes County are FAR LOWER than they were 17 years ago. The dizzying increases in housing & food along in the past ONE YEAR are enough to WIPE OUT that 14% real gain in wages. Inflation in Deschutes County price levels was gauged at 9% in a recent Bulletin article... an understatement I think.
We've had an "economic pass" to date, because the massive inflation in housing has roughly translated into income via the people dancing the "refi shuffle". THAT is how we've stayed alive. Without that, this place would be in a depression. Wages up 14%? That is a disaster... and believe it or nor, things have gotten WORSE here since 1990! We would need incomes up around 150 - 200% to be "even" with 1990.
Deschutes County has been one of the top-ranking of Oregon's 36 counties for years, according to the employment report, and had higher per-capita income averages than the state and national levels in 1990.
Again: Our average income is BELOW THE STATE AVERAGE NOW. We were ahead in 1990, now we are below. Then how is the apparent prosperity POSSIBLE?
Conveyor Belt incomes & the Refi Shuffle. Without those, we are DEAD MEAT. And I just checked: the conveyor belt was dismantled due to lack of use, and they stopped the refi shuffle music.
We are FAR POORER than we were 17 years ago. Luckily we have city councilors on a steadfast lookout for our best interests, by taking affordable apartments condo, before ground is even broken.
“The fact that it’s a change from the original concept doesn’t trouble me at all.”
UNBELIEVABLE.
The small investor, who may have no idea what a CDO is, should care.
``We should care because our money market account, pension account, insurance company all may be invested in these securities, which have not been tested in a down cycle,'' s
When CDOs Trump Paris Hilton, There's a Problem
By Caroline Baum
June 27 (Bloomberg) -- If you're like me and can't seem to get your arms around the concept of home loans pooled into mortgage-backed bonds packaged into collateralized debt obligations carved up into tranches combined to form other CDOs (CDOs-squared), you may wonder what all the hullabaloo has been about these past few weeks.
Unless you're a Bear Stearns Cos. stockholder or an investor in a hedge fund that owns the riskiest piece of a CDO (the equity tranche), the owners of which line up behind everyone else when it comes time to get paid, why should you care about complex Wall Street structured-finance products designed to turn a hefty profit without landing the issuer in jail?
Answer: Because losses in one area have a way of rippling through to others; because risk is a four-letter word, especially if priced improperly; because uncertainty about the value of illiquid, opaque securities backed by home loans breeds risk aversion on the part of mortgage lender and CDO investor alike; because the lightly regulated derivatives market has become so big and so diffuse that some out-of-nowhere event may bring the domino theory back for a retest; and because each of us, directly or indirectly, owns a small piece of the rock.
When he was Federal Reserve chairman, Alan Greenspan extolled derivatives as a way to unbundle and transfer risk to those willing to assume and manage it.
But first the risk has to be identified and priced as such. Many CDOs were considered practically risk-free, with their ability to deliver a steady, reliable return month after month.
Safety in Numbers
It's true there's safety in numbers. Put enough junk bonds or subprime mortgages into a composite entity, and a default here or there isn't going to matter.
It may be easy, with the benefit of hindsight, to say ``there was insufficient capital at the very beginning, but it was not impossible to determine it at the closing date based on the underwriting characteristics of the loans,'' says Sylvain Raynes, a principle at R&R Consulting, a structured valuation boutique in New York, and author, with Ann Rutledge, of ``The Analysis of Structured Securities.''
The delinquency rate for subprime loans rose to 13.8 percent in the first quarter, according to the Mortgage Bankers Association. It was 11.5 percent a year earlier.
When the collateral in residential mortgage bonds is impaired, ``nothing will undo the losses,'' says Joseph R. Mason, associate professor of finance at Drexel University in Philadelphia. ``It's a static pool of investments, a brain-dead trust.''
Buying Time
With the residential real estate market continuing to deteriorate, mortgage-related derivatives aren't only a concern for sophisticated investors, rating companies and regulators. Subprime delinquencies may cause problems for everyone from potential homebuyers to small investors to the Federal Reserve to the man on the street. It's something everyone should care about.
If you are a Bear Stearns shareholder, you should care. The securities firm will inject about $1.6 billion into one of its failing hedge funds to prevent a fire sale of illiquid assets, including CDOs, by creditors. The stock has lost $6.46, or 4.4 percent, since the announcement.
In becoming its own lender of last resort, Bear Stearns bought itself some time. If neither housing nor market conditions improve, time may not be on its side.
Hedge funds should care. The over-the-counter CDO market is opaque. The value of any CDO is primarily model-determined. There is no active market and no fair market value. It's a kind of don't-ask-don't-tell-'til-you-gotta-sell system.
Making a Mark
Once a CDO is sold, it forces other investors to revalue, or mark to market, that security. Last week, creditors of Bear Stearns's hedge funds seized collateral to cover the funds' losses and ended up selling only a small portion of the assets. It's not far-fetched to think other lenders to other hedge funds will come a knockin', forcing liquidations into a poor market.
The small investor, who may have no idea what a CDO is, should care.
``We should care because our money market account, pension account, insurance company all may be invested in these securities, which have not been tested in a down cycle,'' says Joshua Rosner, managing director at Graham Fisher & Co., an independent financial-services research firm in New York. ``We should care because as we saw last week, an asset carried at a value determined subjectively maybe be worth a lot less when it's traded.''
S&L Crisis
The Federal Reserve should care. While Bear Stearns's bailout of its hedge funds is being compared to Wall Street's rescue of Long-Term Capital Management in 1998, a better paradigm might be the savings and loan crisis in the early 1990s. Insolvent thrifts saddled with -- guess what? -- bad real estate loans depleted the now-defunct Federal Savings and Loan Insurance Corp., which provided deposit insurance to S&Ls. The U.S. government created the Resolution Trust Corp. to dispose of bad loans, auction off the underlying properties, shut insolvent thrifts and arrange for solvent institutions to assume the performing loans of insolvent ones.
The result was a true credit crunch, with banks unable to make new loans until they repaired their balance sheets. The economy hobbled along until the process was complete.
Nowadays banks are only a small part of the home-loan market. Outside the banking system, the situation is worse. Rising defaults on subprime mortgages have forced some 60 mortgage companies to close or sell their operations since the start of 2006, according to Bloomberg data.
Prime Real Estate
Lenders are tightening credit standards on mortgages to non-creditworthy borrowers at a time when the inventory of unsold homes is at a record of 4.43 million. The overhang has doubled in a little more than two years.
Potential homeowners should care. First-time buyers may have greater difficulty getting a mortgage, which means owners of starter homes may have trouble selling theirs, and so on up the food chain.
The man on the street should care. It gets tiresome reading primers on structured finance on the front page day after day when Paris Hilton is achieving new levels of self-awareness. The sooner newspapers can get back to what sells, the better.
The median income for a household in the city ( of Bend ) was $40,857, in 2006
Let's NOT let this little fact escape us in our modelling.
Note the source is "wiki-bend-oregon".
We are FAR POORER than we were 17 years ago. Luckily we have city councilors on a steadfast lookout for our best interests, by taking affordable apartments condo, before ground is even broken.
The council is loaded with pro-development, the ONLY constituent that matters is Mrs. Breeze and ILK, and what you see here is an old fashion bail-out.
The "beautiful people" of Bend, the kind of people that make Bend like Aspen, are in a world of financial shit.
Thus the council and mayor will do whatever they can to help Mrs. Breeze and the EDCO tombstone unload their shit. Even it means having the City of Bend "BUY" the Breeze&Co. Condos and land, at todays "high-price", better move quick.
Today the CDO is ten cents on the dollar, this is why bear-stearns moved in to create a market and paid $3.2B or their best $10B fund, and the market was only offering $1B { ten cents on the dollar }. Soon Mrs. Breeze & Co, will only get ten cents on the dollar for their investments.
So what do you ??? You sell the SHIT to City as low-cost homes.
Even the POOR don't want to live in a fucking condo.
Meanwhile, in California...
The Bakersfield Californian. “A steep but cyclical decline in real estate advertising has forced The Bakersfield Californian to eliminate 40 positions, company CEO Richard Beene announced Tuesday.”
“Between 2004 and 2006, The Californian enjoyed strong profits largely because of an ‘exploding real estate market,’ Beene said. But recently, real estate agents, home builders and others in the industry have scaled back their advertising, he said.”
“Lennar Corp. has dominated the Bakersfield homebuilding market since it bought local builder Coleman Homes in the spring of 2003.”
“At its peak two years ago, the company took out 1,042 permits to build homes in Bakersfield, according to a report by Ticor Title. Last year, Lennar took out 500 building permits through May. This year, the company pulled 176 during the same time period. In April, the company took out just one.”
“Around town, homebuilders have started offering concessions and price cuts to move homes, said Jairo Duenas, an agent (in) Bakersfield who specializes in new home sales.”
“‘The newer homes are probably easier to sell now with all the incentives they’re giving now,’ Duenas said.”
“Some builders have been offering $10,000 to help with closing costs, as well as providing free appliances and mini-blinds for a new home, Duenas said. Others are slashing prices. Some builders are offering $15,000 to $20,000 price reductions on $250,000 to $280,000 homes, Duenas said.”
Per-capita income is the average personal income for every man, woman and child in the area studied. Per-capita incomes include additional sources of income outside of jobs, such as retirement income, Social Security, rent, and interest and dividends, Williams said.
This is what they meant by "average personal income".
What's amazing is that the period named (correction: 1990-2005), has been a time of unparalleled prosperity in Deschutes County. Yet incomes have grown at below state & national averages. And they're measuring AVERAGES which should reflect a few high-rollers really cleaning up. Here's more:
Funke believes that income gains are growing in the region, but Central Oregon still lacks the number of high-paying industries that benefit workers in larger areas.
"That's changing, too, as (the fringe areas) grow and grow jobs," Funke said. "But I would still argue that (the new jobs created) are mostly in leisure and hospitality, which are typically low-wage jobs."
We are so dead. Our big sources of income for keeping the Bend Hot-Air Economy afloat are GONE, and will NOT RETURN in our lifetimes.
$180K medians WILL HAPPEN. We've LOST GROUND during a time of HUGE increases in apparent prosperity... what happens when things go South?
I know what I'm going to do: Underbid City projects, steal land at below market rates from Dupe-tastic Bend City Morons, and before I've even bought a shovel, CHANGE the plans so completely (with the full knowledge that City Councilors are either 1) my best friends, or 2) Too stupid to figure out ANYTHING), and BANK THE MONEY.
They are PRE-SELLING CONDOS that are not even built, for an AFFORDABLE apartment complex, that EVEN AREA REALTORS SAY is UNAFFORDABLE:
“You’re looking at about a $1,500-per-month payment, plus insurance and taxes,” Coldwell Banker Principal Broker Wendy Adkisson said. “I don’t think that sounds very affordable to me, if you’re making minimum wage.”
Completely duped the City, before they even spent a DIME!
"Costs on this NON-EXISTENT building have gone up 20%! Oh no! We need to go condo ASAP!
You know what will be interesting: There are 4 floors of condo-ments, 44 total, with 11 going condo. WHICH floor will go condo? My bet is that it will almost certainly be the top floor. Apartment skanks? They don't need no stinking penthouse! If it's the 3rd level, that tells me they will, YET AGAIN, take another floor condo, the top floor.
No matter what happens, the TOP FLOOR will ultimately go condo, and if it is NOT the initial floor going condo, that ABSOLUTELY POSITIVELY means they have EVERY INTENTION of taking the top floor condo at a later date. Mark my words.
If it's the top floor now, it'll be harder to take other floors condo later. If it's the 3rd level, that top floor will go condo as sure as the sun rises, and they'll get higher prices since there'll be a level "insulating" the penthouses from the renting rabble.
Maybe it's all moot: You can't GIVE AWAY condos in downtown Bend these days. Although, since they totally spanked the City on buying the land underneath, the prices are WAY below market. If I was a condo builder downtown, I would either A) Be incredo-pissed about this, or B) Jump on the taxpayer spanking bandwagon.
“That’s one of the reasons that I’m really supportive of this project because there simply isn’t a supply of affordable condominiums,” Councilor Linda Johnson said at the urban renewal board’s meeting June 20. “The fact that it’s a change from the original concept doesn’t trouble me at all.”
This quote alone makes Linda Johnson my new MEGA SKANK BEND CITY COUNCILOR, replacing long-time skank John Hummel. This woman is CONCERNED about the supply of AFFORDABLE CONDOS. The entire point of selling the land was ACTUAL AFFORDABLE APARTMENTS, NOT CONDOS for the quasi-rich.
UN - BEE - LEEVE - ABLE!
What in the hell are these people thinking? Jim Clinton is the only quasi-sentient being in City Council:
“I’m skeptical when people agree to build something and then, over the period of a year, the price goes up by over 20 percent,” City Councilor Jim Clinton said Monday.
At least he's "SKEPTICAL". No one else voted against it. We're being raped by some developers, and ONE COUNCILOR is SKEPTICAL. Good job Bend City Council. Nice.
“I’m skeptical when people agree to build something and then, over the period of a year, the price goes up by over 20 percent,” City Councilor Jim Clinton said Monday.
You can bet your sweet ass, that if a builder actually raised the pre-construction price for building a home for any one of Bends City Councilors, there sure as hell would "be a problem".
That comment by Linda Johnson just burns my ass. Inexcusable! What in the hell are these people doing? There should be a house cleaning where every single Bend City Councilor is fired for incompetence. Why do we stand for this?
This is like Cuba! Incompetent leaders that are killing us economically, but they can't get booted out of power! WHY?
This is like Cuba! Incompetent leaders that are killing us economically, but they can't get booted out of power! WHY?
Maybe more like the USA under Bush/Cheney/Gonzales.
Incompetent leaders that are killing us economically, but they can't get booted out of power! WHY?
Because YOU have no power, the 'electable' are only beholden to RE&Family.
If&When RE boots them they'll go, until then enjoy the ride.
The best thing that can happen to Bend is that the RE&Family ( Mob ) lose their financial ASS ASAP, which would over-night cause the 'electable' to find NEW sponsors.
Right now just watch like a hawk to make sure that Bend's finest citizens don't get bailed out. Right now the program ASAP is to have the city buy all the white-elephants that the 'finest' have all their $$$ tied up in.
The fact is there should be a moratorium on ALL RE purchases, until 2008, when the dust has settled.
The fact is there should be a moratorium on ALL RE purchases, until 2008, when the dust has settled.
Ditto.
The City of Bend should NOT be in the RE business. By 2008 there will be low income housing ALL over bend.
Just wait.
No taxpayer dollars should be used by Bend to purchase or subsidize housing.
1,000's and 1,000's of 2000sq-ft desert mcMansions will be for rent under $1,000/mo very soon, and some for even less than that, and that is "low income housing".
Just wait.
For all the dumb ass cunt that has their $$ tied up in the Bend River "Condo Canyon", tough shit, you bought high, and you'll sell low or foreclose, and there will be NO crocodile tears.
What burns my ass is that development was SUBSIDIZED by Bend taxpayers, and before a single bead of sweat was shed onsite, they've already started going condo, with the FULL SUPPORT of Bend City Council.
This borders on CRIMINAL. Are there kick backs going to Linda Johnson & Co.? WHAT IS GOING ON HERE?
What a MASSIVE BOONDOGGLE RIPOFF! You & I, Bend taxpayers, are beginning to SUBSIDIZE DOWNTOWN CONDO DEVELOPMENTS WITH THE FULL SUPPORT OF BEND CITY COUNCIL! DAMMIT! $500,000 in taxpayer money in a downtown condo development.
City Councilors should be fired? Scratch that.
THEY SHOULD BE JAILED!
All dressed up and nobody to blow
Once upon a time some "flat-backing" Ho's took all their money and invested in condos.
Then johns quit coming to town, and there was nobody to buy the condos.
The Ho's begged and begged the city fathers to buy the condos, but to no avail.
The condo's just sat and sat and gathered dust, the ho's couldn't make payment, and they became foreclosures.
There were subsequent enduring tears from all the town folk who were quite sorry to see all the Ho's lose their hard earned money.
They tried to sell the condo's to other Ho's, but no deal. They tried to market the condos as business RE, but to no avail.
Then they tried to market the condos as low income housing. The city fathers made a deal, free flat-backing for perpetuity, in exchange for buying all the condo's with city bonds.
Thus forever after the spawn of the Ho's had housing, and everyone lived happily ever after.
AFFORDABLE HOUSING IN BEND IS A BOONDOGGLE!
I railed against this on my blog and I will rail with my last blog-breath.
How do you like the position of the chairman of Bend's Affordable Housing Committee?
Tucker said Lava Court will be good for the city but stressed that it won’t be able to take care of all of Bend’s affordable housing needs. His hope is that a city fund issuing low- or no-interest loans will spark construction for more affordable homes.
This is a SHOCKING position. A city fund writing mortgages? "Spark construction"?
OK let's step back a bit. This is the same city that just last year instituted bus service, thereby bringing our public transportation network up to the level of any comparably sized city in Mexico. And this was accompanied by a procurement scandal, a failure-to-comply-with-ADA scandal and a using-taxpayer-money-to-fight-unionization scandal. I won't even mention the Les Schwab capitulation or the wink-winks that land speculators are getting who approach the city about incorporating THEIR land in the UGB.
The city could fuck up a cup of coffee, and they should probably know it.
So now this same incompetent city is going to have its own Housing Authority? Issuing frickin' no- or low-interest mortgages? To "spark" even MORE construction in a town with multiple homes for sale on every block and construction STILL going strong?
I remain flabbergasted that anyone wielding city authority is suggesting publicly that more housing construction is the answer to any problem Bend might have right now.
Also, who is going to BUY a condo at pretty expensive prices in a public housing project? Cabrini Green isn't topped by penthouse condos, for good reason.
All of us should be skeptical as HELL that this project is being rushed into production now, at inflated prices no less. This stinks.
What's really f\_/cked up, is this "Eat Your Young" attitude. We'll screw the hell out of any indigenous, pre-existing projects/people/group to get The Next Project built.
Why should I buy Franklin Crossing, when Lava Court is coming down the pike at even lower prices subsidized by taxpayers! COOL! But then why should I buy Lava Court, if City Councilors are keen on giving away city assets at fire-sale prices? I'll just wait for the next taxpayer boondoggle/condo development & buy that. But, why not wait again for the NEXT Big Thing...
If you're thinking of moving to Bend, think again. This place cannibalizes it's own. Buying in Broken Top? It's either Ferris Wheels or the butt-end of Tetherow views for you... and no one cares. Building homes? Think again, the Next Guy might get land subsidies (or UGB inclusion) from City Councilor buddies that makes your overpriced crap unsellable, or worse, unbuildable.
This is a SHOCKING position. A city fund writing mortgages? "Spark construction"?
Damn right BEM. There's so much wrong here, it's hard to take it all in in one reading.
This is FRAUD. It's CRIMINAL.
Damn right BEM. There's so much wrong here, it's hard to take it all in in one reading.
This is FRAUD. It's CRIMINAL.
There's a good thread on BendBB that tracks local preforeclosure activity. New ones every day, including those owned by supposedly solvent local developers.
The cynic in me (who usually wins arguments with the trusting soul in me) looks at the timing of this Lava Court announcement and thinks that people who exercise city power and those whose mandate is to husband the city affordable housing fund are looking at the freight train of foreclosures steaming towards Bend and are like "if we don't sign the papers now, we'll never have a chance to bro out our builder buddies."
Don't the people who run these funds have a fiduciary duty to the taxpayers? They should call their lawyer before the next time they pick up the phone when COBA calls.
Issuing frickin' no- or low-interest mortgages? To "spark" even MORE construction in a town with multiple homes for sale on every block and construction STILL going strong?
This is mind-boggling. And I can hear RE vultures howling with delight saying, "Go ahead! BUILD! It'll crush prices & I can finally pick up that Westside stilt-O-rama shack! ROCKIN'!"
Maybe true, cuz the Bend housing market is too big for the City to support. But I guarantee you they will try. We will be in the low-income housing business in TWO SECONDS. When Boss Hogs condo dev doesn't sell out, don't you think he'll run to Enis on Bend City Council & practically rape taxpayers right there? OF COURSE!
"Hey Enis, I can't sell these condos at 300% markup like we thought. How's about'n you talk the other Coucilor idiots into having the City pay me what I want, and then rent it out for $400/mo.? It's WIN WIN! I WIN, and YOU WIN! The taxpayers get their asses reamed like there's no tomorrow, but those worthless losers have been getting butt-whaled for decades by us, and haven't moved a muscle. LET'S DO IT!"
Incestuous, Influence-Peddling Backslapping, Old Boy Networking City Councilor Mother Fuckers!
Damn... I'm starting to get as pissed off as Bend-Bilbo-Bust-Baggins here. I need a beer. And I agree... Silver Moon is The Place.
You know Paul, I was checking out the rentals on the Google toy you installed on the front page and it is an insight-bringing gadget.
You have people right alongside 3-bedroom houses renting for $950 a month and 4-bedroom houses with Cascade views for $1250/mo and 2-bedroom houses with Cascade views on acreage for $850/mo other suckers trying to rent out a Mt. Bachelor Village boat-anchor investment for $3000 a month - on a NINE MONTH LEASE!
The investor corps in Bend is so hosed, so very very hosed.
Incestuous, Influence-Peddling Backslapping, Old Boy Networking City Councilor Mother Fuckers!
With apologies to Duncan, what we really need is IHTBYB on the city council. That would make for some interesting council meetings (to put it mildly).
Here's what the Bulletin article might look like if IHTBYB joins the city council:
"I'm skeptical when people agree to build something and then, over the period of a year, the price goes up by over 20 percent," City Councilor Jim Clinton said Monday.
"What a MASSIVE BOONDOGGLE RIPOFF," Councilor Paul Doh said. "You & I, Bend taxpayers, are beginning to SUBSIDIZE DOWNTOWN CONDO DEVELOPMENTS. This is FRAUD. It's CRIMINAL."
But the rest of the council appeared receptive to the change of plans when Housing Works pitched the idea at meetings last week.
"That's one of the reasons that I'm really supportive of this project because there simply isn't a supply of affordable condominiums," Councilor Linda Johnson said at the urban renewal board's meeting June 20. "The fact that it's a change from the original concept doesn't trouble me at all."
Don't the people who run these funds have a fiduciary duty to the taxpayers?
All that we have to do is fax & post the above last ten posts' all around town to the press, and Oregon Press, and Bend will be completely shamed.
The whole deal here is NO light on the cock-roaches, they hate light.
If everyone here wrote letters to the editor, and talked this stuff at council meetings, and handed out flyer's of the above. The council would quickly change. The problem has been that the only ONLY friends of the council in recent years has been the RE industry.
Now the council is scared SHIT-LESS, and they're advisor's are telling them that they just need to bail-out the advisor's. There is a LOT of conflict of interest in Bend, and you can bet your arse, that many of our electable are also going to lose.
Besides, with the loss of CDO's & Subprime, city money is the ONLY money in the game now. The CDO market for new MTG is NOW down 85%, that is it has gone from $20B to $3B, thus there is NO money coming to bend to buy condos. Thus the Mrs. Breeze&Co. Must Make the City finance ALL the projects in order to sell them. Otherwise Mrs.Breeze and company go to the poor-house.
Freight train of foreclosures steaming towards Bend and are like "if we don't sign the papers now, we'll never have a chance to bro out our builder buddies."
What good is HO's owning Ho's, if you cannot get payback when due?
Our electable Ho's are obligated to those that financed their elections. There is NO way in hell that bem, ihtbyb, or even the mighty duncan can pay the $$$$ required to feed the electable.
It's now payback time, save the golden goose. Sell those condo's now at 2005 prices, because by 2008, even the bought-and-paid for appraisers will be down +50%.
Use City money because the CDO/MTG market is completely fucking gone. There is no new money coming to Bend, and the boss-hogs know it.
The ONLY game in town now, the only thing left, the only buyer in world is the City. Not even the fucking Nazi's are stupid enough to come to Bend now to buy a condo.
There is only two ways to sell now. First is the 100% cash buyer, and second is a city-finance deal. Everybody knows the 100% cash buyer isn't coming, so that only leaves the City as the MTG broker of last resort.
Another way to look at this is, CDO/MTG is down 85%, of that $3B available right now, what kind of fucking investor in the world would let some of that go to Bend, Oregon, the most over-valued shit-hole in the US???
NOBODY, thus City-Finance is the BUYER of last hope, if we screw up this deal, then Breeze&Co, and EDCO-Tombstone are FUCKED. Completely financially hosed.
They're already bankrupt and they know it, but by getting letter's of intent today from the City they can hold off foreclosure.
This is all that is going on right now.
They're already bankrupt and they know it, but by getting letter's of intent today from the City they can hold off foreclosure.
This is all that is going on right now.
How do we prevent this letter, is will be drafted in Executive-Session, and will not be available to the public?
The amount of U.S. high-grade, structured finance CDOs that are being offered to investors has plunged to $3 billion, from $20 billion a month ago
There is NO future, the CDO/MTG pipeline is going to be dry for a longtime. Bend's Best Citizens, the folks that went into debt to build our condo's, have found NO buyer, today they can no longer pay their monthly, and they're smart enough to cut their losses.
The ONLY way to way to buy time is to get a letter-of-intent from the City for all these condo developers so it can appear on paper that in the coming months the City-of-Bend will pay top price for ALL these white-elephant condo's that nobody wants.
***
Planned CDO Sales Dry Up Amid Bailout, JPMorgan Says (Update1)
By Darrell Hassler
June 26 (Bloomberg) -- Planned sales of collateralized debt obligations backed mainly by subprime mortgages are drying up and may shut down amid concerns about the integrity of the market following the near collapse of hedge funds run by Bear Stearns Cos., JPMorgan Chase & Co. said.
The amount of U.S. high-grade, structured finance CDOs that are being offered to investors has plunged to $3 billion, from $20 billion a month ago, JPMorgan said in a report dated yesterday. CDOs are pools of asset-backed securities, bonds or corporate loans divided into securities with different credit ratings and maturities to cater to investors' preferences.
Bear Stearns, the biggest broker to hedge funds, is trying to keep two funds afloat after bad bets on securities backed by home loans led creditors including Merrill Lynch & Co. to seize and sell off some of their assets. That response by creditors, which included a demand for more collateral, raised questions about whether the mortgages and other assets contained in recently issued CDOs have been accurately valued by the market.
``We expect events surrounding warehousing liquidations last week to further slow, if not halt entirely, the new issue market,'' JPMorgan analysts led by Chris Flanagan in New York said in the report.
The average yield premium of high-grade structured finance CDOs with BBB ratings widened 1.5 percentage points last week to 7 percent over the London interbank offered rate, the biggest spread this year, JPMorgan said. Libor is a borrowing benchmark.
The damage to the $1 trillion CDO market could freeze what has been a large source of liquidity for the credit markets, Tim Backshall, chief strategist at Credit Derivatives Research LLC, said yesterday.
Not even the fucking Nazi's are stupid enough to come to Bend now to buy a condo.
Hey now! That's just fear-mongering! And besides, there ARE still some Nazi's stupid enough to buy in Bend! We'll get those Nazi's here yet. And by gum, we'll put 'em up in affordable downtown condo's if that's what it takes to keep 'em here.
That is NO woman, that is a Condo Sale Woman, ...
"Many of these good looking girls are not high-class assets worth 100 cents on the dollar." Investors were fooled "by the makeup, those six-inch hooker heels, and a 'tramp stamp.'"
Why the Condo's Will Never Sell ... The Easy Money is Gone ... Let's see How quickly we can Bankrupt Bend Oregon ...
A generation ago, housing finance was different. Bankers took in deposits, lent that money to home buyers and collected interest and principal until the mortgages were paid. Wall Street wasn't much involved.
Now it plays a central role. Wall Street firms provide working capital that allows thousands of mortgage firms to make loans. After lenders sign up consumers for home loans, investment banks pool the income streams from these loans into bonds known as mortgage-backed securities. The banks sell them to yield-hungry investors around the world.
Before the mid-1990s, mortgage-backed securities consisted mostly of loans to borrowers with good credit and cash to make ample down payments. Then investment banks found they could do the same with riskier loans to borrowers with modest incomes and flawed credit. Pooling the loans created a cushion against defaults by diversifying the risk. The high interest rates on the loans made for bonds with high yields that investors savored. New technology helped make it easier for lenders to collect and collate mounds of information on borrowers.
The flaw resides in the suburbs of Bend, Oregon, in the extended city limits of Chicago headed west towards Rockford, and yes, the naked (and empty) rows of multistoried condos in Miami, Florida.
The flaw, dear readers, lies in the homes that were financed with cheap and in some cases gratuitous money in 2004, 2005, and 2006. Because while the Bear hedge funds are now primarily history, those millions and millions of homes are not.
They’re not going anywhere... except for their mortgages that is. Mortgage payments are going up, up, and up... and so are delinquencies and defaults.
Look at this craigs, they're so hard up they'll take dogs, mill-dist,new house, 3bd-2bt; and its AFFORDABLE. We don't need 'affordable' condo's. We have affordable mcMansions all over Bend right now, and many for less than $1k/mo
**
$1000 / 3br - MILL DISTRICT 3 BED/2 BATH
Reply to: hous-360893368@craigslist.org
Date: 2007-06-26, 1:34PM PDT
Three years new home in quiet coldesac. Walking distance to river park, trails & Old Mill. Open floor plan w/ WD, private back deck & fenced yard, AC. Pet friendly w/ additional deposit. Avail. 8/3
Pet friendly w/ additional deposit.
These people just don't know the biz, renters never clean up after pets. These homes will have to be destroyed in few years. The mill-dist is not 'affordable' it will become section-8, low-income, poor-farm housing.
Tucker said Lava Court will be good for the city but stressed that it won’t be able to take care of all of Bend’s affordable housing needs. His hope is that a city fund issuing low- or no-interest loans will spark construction for more affordable homes.
Bend is Aspen, and there are a ton of mcMansions available for $1k/mo or less. Thus all we do is have a fund pay the rent on these homes, and the city doesn't have to go into the 'construction/mortgage' business. But that would not be any fun would it? ...
What our paternalistic city needs to do is provide a 'FAIR' income to everyone, so we can all 'afford' those $1k/mo mcMansions.
Uncle Sam is the BIGGEST Sub-Prime Borrower of Them All,
or Government numbers in sharp contrast with reality
The meltdown in the subprime mortgage market is inexorably spreading throughout the U.S. economy. The first shoe dropped in February, when scores of mortgage originators went bust amid rising defaults and tightening lending standards. Last week, the second shoe dropped as two CDO-focused Bear Stearns hedge funds blew up. Overshadowed by the Bear Stearns drama which unfolded at the same time, California-based brokerage firm Brookstreet Securities shut its doors when unsecured customer losses from margined investments in collateralized mortgage obligations were "unrepentantly" marked down. However, as the subprime monster likely resembles a giant centipede, this will not be the last show to drop.
Bear Stearns' reluctance to mark down the value of their overpriced CDOs is mirrored by an equal desire among homeowners to hold tight to their fantasies of real estate riches. Despite the obvious weakness in the current market, deluded sellers continue to behave as if the boom of 1998-2005 never ended. A recent survey by Boston Consulting Group showed that 55% of home owners believe they could sell their house for more now than a year ago, and nearly three-quarters think they could sell their homes within the next six months at a price they set. Is it any wonder that there is a record 8.9 months supply of new homes on the market?
Just as CDOs are not worth the "marked to market" value conveniently assigned by Wall Street, homes throughout the country are not worth anything near the asking prices listed on "For Sale" signs. Wall Street may be able to buy some time by bailing out troubled hedge funds to keep their worthless subprime mortgage investments off the market, but no such safety nets exist for strapped consumers looking down the barrel of resetting adjustable rate mortgages. Inventories will continue to balloon until reluctant home owners come to their senses and slash prices.
If they do not do it themselves, appraisers, just like Brookstreet Securities’ clearing firm will do it for them. Imagine the effect on the economy when America consumer’s biggest assets turn into their greatest liabilities!
However, as I have been writing for years, the biggest losers in the real estate bubble will not be the borrowers who took advantage of easy credit, but the lenders who foolishly underwrote the loans. Whether they be unsophisticated clients of small brokerage firms like Brookstreet, or big time hedge fund clients of Bear Stearns, anyone who owns subprime mortgages is going to lose money. Some will lose 100% of what they invested, and those who used margin may lose even more.
The main problem was that Wall Street, hungry to feed the profit-rich CDO market, convinced the mortgage industry to abandon all traditional lending standards. In prior years, when borrowers were required to make sizeable down-payments, lenders were assured that borrowers would not knowingly commit themselves to mortgages that they could not afford, and that sufficient collateral would exist were defaults to occur. In addition, by verifying incomes and assets, lenders gained further assurance that loans would actually be repaid.
Once lenders dropped down payment requirements, the stage was set for the unfolding disaster. The advent of no-documentation loans, especially ARMs with teasers rates, interest-only payments and negative amortizations, further allowed risk free speculation to run rampant. Is it any wonder house prices rose so high when Wall Street allowed so many people to gamble with other people’s money?
If borrowers actually had to put their own hard-earned money down, they would have thought twice before committing themselves to mortgages they could not afford. But once Wall Street took all of the risk out of real estate speculation, there was no reason not to roll the dice. So borrowers lied about their incomes and stretched to meet payments because if home prices kept rising all the profits would belong to them. For years it was a stunningly successful bet that minted real estate tycoons by the hundreds of thousands. And, if prices reversed course, they had nothing to lose, as they put nothing down. Buyers could walk away from their bad bets none the worse for wear, leaving lenders to cover their losses.
However, amidst the hysteria and oblivious to their own roles in perpetuating the bubble, lenders also believed that real estate prices could only go up. With such assumptions, defaults seemed unlikely and ultimately riskless (a foreclosed property worth more than the underlying mortgage is a boon). Also, in many cases, as hedge fund managers made huge profits by risking their client’s money, both the borrowers and the lenders had no skin in the game. All the risks were transferred to those who purchased the re-packaged loans, and who are now left holding the bag.
All of the pundits and so called “experts” who did not see this coming still do not appreciate the magnitude of the mortgage disaster and how it will impact the housing market in general, the economy, the stock market, the dollar, interest rates, inflation, and the price of gold. They are content to believe government hype about the resilience of the American economy. On Tuesday, just as home building giant Lennar reported huge losses due to a weak pricing environment, the government told us that new home prices basically held firm to last years gains. Later in the week, similar losses blamed on falling home prices were reported by KB Homes. Just like with the CPI, this is yet another example of government numbers being in sharp contrast with reality and why they should always be taken with a grain of salt.
The curtain has yet to close, but if you listen closely you can hear the fat lady warming up in the wings. It has been one hell of a show, but there will be no encore. For those holding toxic mortgage paper there is nothing left to do but sue. However, even those who do not own this stuff are not in the clear. A much larger disaster looms for holders of U.S. dollar denominated assets in general. It will not be long before our foreign creditors realize that Uncle Sam is the biggest subprime borrower of them all and will similarly mark down the value of its debts as well.
Months ago I asked IHTBYB what he meant by "incentives", and he delayed and delayed, and then finally made clear to us, that bail-outs for get-rich-quick folk was not what he had in mind.
Now is the time. The City Council today has made it quite clear that bail-out time is here.
The best citizens of Bend have no choice. These are the people who get invited to the chosen party's. The politicians are obligated to rescue Bends best citizens.
Most of our Aspen-is-Bend crowd have every nickel to their name tied up in Condo projects the crack-cocaine of the sub-prime stated-income bubble.
Now they will demand from the City-Council "Letters of Intent", that the city will purchase all this un-sold condo-space to be used as 'affordable housing'.
Months ago I predicted this would transpire.
There will be many excuses for the bail-out, to help construction, to create affordable housing.
The market is already at work. Bend already has enough excess housing for the next twenty years, let's not build more. There are 1,000's of empty homes in Bend that owners would be love to get a voucher from a low-income person. If Bend really wants to subsidize housing, then lets do it with the 1,000's of empty homes we already have.
There should be an immediate moratorium on building in Bend. The City should not obligate any money until 2008, but that time we'll have a clear picture of the impact of the loss of the MTG market.
Everybody knew when Franklin Crossing's was being built it was a white-elephant, and the same for all the other condo-canyon projects that have destroyed our beloved Deschutes Corridor.
The people who owe Millions on these condos that will not sell, should simply go bankrupt like anyone else that made a bad decision. The City of Bend should NOT bail these people out. Even if they're the Best Citizens of a one horse town.
What's a New Mill District 3bd-2ba Home Worth in today market in Bend, Oregon??
(house is worth $120k.)
$1000 / 3br - MILL DISTRICT 3 BED/2 BATH new home in quiet coldesac. Walking distance to river park, trails & Old Mill. Open floor plan w/ WD, private back deck & fenced yard, AC. Pet friendly w/ additional deposit.
Standard rule's say they house is worth 10X of the yearly revenue.
Here this person is DESPERATE in taking pets. His $200 deposit will no mean shit when he get $20k damages.
$1k/mo, if HE could actually get it in todays 'affordable market', is $12k/yr, so that house is worth $120k.
There you go, a brand new Mill-District close-in 3bd-2bth is worth $120k in Bend Oregon. If you could find someone with $24k down to actually qualify for the loan.
If the City-of-Bend had vouchers for poor people, you know that landlord would be glad as hell to get an $800/mo voucher from the city. It sure beat rent checks that bounce.
Given all the affordable housing sitting empty in Bend, why in the Hell should the City Invest Our Money in more Real-Estate. We already have an inventory that will take twenty years to clear.
Now they will demand from the City-Council "Letters of Intent", that the city will purchase all this un-sold condo-space to be used as 'affordable housing'.
The letter-of-intent is just a mechanism to delay foreclosure. All these projects will foreclose, its just a matter of time.
The banks that loaned the money, and most likely CACB can take these letters-of-intent and treat them like in-lieu payments. Our Best-Citizens are just buying time.
It wouldn't look good for the entire Bend House of Cards to fall during Peak Tourist Season would it??
The investor corps in Bend is so hosed, so very very hosed.
What I find, and always found, so incredible about bubbles is how far beyond common sense they can go. Valuing Bend homes based on rents yield a number that we just blew through... and then kept going... and going... and going.
I think the converse will happen on the way down. We talk about the horrors of $180K medians, and some just think that is outrageous fear-mongering.
We had $185K medians in 2004!
Is it so outrageous to lose 3 years of gains? I don't think so. Especially when the gains were outrageous. I think a lot of Cali's are so used to $600K+ medians, that they came here, saw things in the mid $300K's, felt real comfy with that, and think we're on a zero-risk rocket ride to $600K medians in Bend.
Man, do they have some bitter medicine coming. This place is ground zero for what could be the most severe RE plunge ever recorded in this country. It'll actually be a miracle if it doesn't happen.
Mad as Hell
I didn't 'invest' in the Bubble.
I didn't make any money in the Bubble.
I didn't sell during the bubble.
I just watched, and watched, I have seen this shit many times in MANY places, in actuality this Bend Bubble exactly reminds me of the insanity of So-Cal in the 70's, when people were buying lottery tickets for the privilege to buy condos.
Now I'll say why I'm angry, because the two-bit whores that run this town NOW, have ALL their money in Condo's. The Crack-Cocaine of Sub-Prime. These beautiful Bend people want US to bail them out, so they don't lose their ass financially.
Their boat is going down, this town doesn't have the capitalization to rescue them, but they'll destroy Bend's credit in trying to do so.
We who have NOT participated in the Bubble SHOULD NOT ALLOW the bill and/or loss of greedy crack-whores to be passed on to US.
They're already talking of increasing the water bill ten-fold just pay for the Les-Schwab Juniper-Ridge "Improvements".
Who knows how they'll pass the cost of "affordable housing" on to us, but they'll try, they'll try anything.
On the guard of Abernethy he has ran this City into the ground, and over built, the City is already bankrupt, given that the folks that run are already bankrupt.
It cannot be said enough times that all the people who run Bend, have NO money, they simply were putting all their money back into Real-Estate, playing the game of crack-cocaine condo flipping. Now you cannot sell condos, and they cannot make payments.
We didn't want this shit, it destroyed the Beautiful old Natural Bend, long after Abernethy and ilk back their saddles and leave this town we'll be stuck with 1,000's of condos that will sit empty. This will be the legacy of the bubble that will not go away.
NO BAIL OUT FOR CONDO CRACK-WHORES.
We need an immediate Halt to all Bend spending until 2008 when we'll know exactly what the bubble-bust damage has been.
The flaw of stupidity and greed, the flaw of Bend Condo Canyon. The flaw of easy money. The flaw of "other peoples money" easily obtained by financial idiots. The flaw of a dis-engaged electorate letting morons run their City into bankruptcy.
The flaw resides in the suburbs of Bend, Oregon, in the extended city limits of Chicago headed west towards Rockford, and yes, the naked (and empty) rows of multi-storied condos in Miami, Florida.
The flaw, dear readers, lies in the homes that were financed with cheap and in some cases gratuitous money in 2004, 2005, and 2006. Because while the Bear-Stearn hedge funds are now primarily history, those millions and millions of homes are not.
They’re not going anywhere... except for their mortgages that is. Mortgage payments are going up, up, and up... and so are delinquencies and defaults.
The flaw was assuming that whores with makeup and six inch heels could market Bend as Aspen. The flaw was assuming the whores would trickle the wealth down.
There is no such thing as a free lunch Bend, the party is over, and the bill is about to be presented.
The word for mortgage in Spanish is ‘hipoteca’ whose verb form has additional meanings of to compromise and to jeopardize.
Hmm, how true!
My forecast stands. With each passing month, my trio forecast looks increasingly likely. The last two are the latest conclusions.
1) the bailout will be at least $1 trillion and possibly much more among bond holders
2) the housing decline will wipe out all gains in national home values since 2001
3) all except one or two home builders will declare bankruptcy
4) USFed wants considerable destruction so as to consolidate the banks
5) USFed wants broad economic decline to usher in the North American Alliance.
My forecast stands. With each passing month, my trio forecast looks increasingly likely. The last two are the latest conclusions.
Dude, excellent conspiracy theories. Keep 'em coming.
conspiracy theories
Conspiracy requires secrecy.
There are NO secrets, just bozo's with their head in the sand, watching TV for a glimpse of Paris Hilton in Jail.
Just because you're paranoid doesn't mean they aren't after you.
Gloom! Doom!
Things have never been better from my perspective. My wife and I have a nice new house in Bend at 2X income ratio. Yes we could have "afforded" much more, but we chose a nice 1800sq ft place and we are quite happy in the knowledge that it won't strain our finances. We could actually get by with just one income if we had to.
Sorry to shine light on your parade of darkness and gloom... Now continue on with your predictions of imminent apocalpyse.
Realtor.com Inventory count:
May 14: 2,280
May 18: 2,320 (+40 -- 4 days)
May 23: 2,343 (+23 -- 5 days)
May 31: 2,391 (+48 -- 8 days)
June 11: 2,439 (+48 -- 11 days)
June 16: 2,464 (+25 -- 5 days)
June 20: 2,514 (+50 -- 4 days)
June 23: 2,546 (+32 -- 3 days)
June 29: 2,598 (+52 -- 6 days)
There are 1,607 "residential" listings in Bend today (centraloregonrealtors.com), vs 1,511 from May 31. There were 814 on May 31 of last year.
That's +207 listings since the start of the month on Realtor.com, and +96 for Bend only residential. I cannot believe there will not be some depressing action on prices from this mega-glut.
Sorry to shine light on your parade of darkness and gloom... Now continue on with your predictions of imminent apocalpyse.
OH NO! Time to shut down the blog! Someone has spent within their means! THE BUBBLE IS OVER!
Announce it far & wide! Yet another individual has bought an "affordable" house. We can finally rest at ease! ALL Homes in Bend are NOW AFFORDABLE!
We thank you Sir. Thank you for this financial miracle.
The founder of Intel once said
"Only the Paranoid Survive"
- andy grove
If you haven't sold your Bend RE, that you had planned to sell your fucked,
If you haven't refinanced by now, your fucked, its going to be next to impossible to get RE money in 1-2 months, albeit at incredible INT rates.
If you own stock and especially bonds, and especially high interest bonds, sell quickly, because the entire bond market is about to get marked down 50% or more.
Note this is why bear-stearns moved to cover their CDO fund, as the market was 0nly offering ten-cents on the dollar. Bear-Stearns stepped in and paid $3.2B ( BS paid 32cents on the dollar ), trouble is that is 1/2 their cash on hand. Soon there will be little play. Note MOST humbly that Bears CDO-MTG trade was only 6% of their BIZ.
The reason that nobody stepped in to bail bear-stearn, as they didn't help out during LTCM. Bear-Stearns will go down. There will soon no cash to rescue their other bond funds, as there will be soon no market for any kind of CDO/CMO, ...
These days all money markets, and high-interest bond funds are tied to opaque hedge funds backed by collateral-bond's.
As people run the bank in the next few months to redeem there where there is no market expect huge losses. This is why Bear-Stearns ante'd $3.2B to save their good name, as the investors of the their CDO fund were told "YOU cannot have your money back", and that was only the redemption of two funds. The fact is NOBODY has the cash on hand to payout redemptions, so only the first 5% will get their money back.
Thus all the pensions, ... everything will get wiped out, this will be the biggest play since the depression. Once again the republicans will get the blame, and the democrats will get us into WWIII.
My wife and I have a nice new house in Bend at 2X income ratio.
Good, we like good story's here.
This site is about surviving.
That said its good to see the condo-whores lose their skirts.
Yes we could have "afforded" much more, but we chose a nice 1800sq ft place and we are quite happy in the knowledge that it won't strain our finances.
The whores of bend say "Build and they will come", what they should have really said is "Loan and they'll spend".
Most people are over their head. You are an example of how the game should be played. We have redundantly reminded people all along of this simple fact.
That said, crime will go up in Bend. So you will be effected by the hysteria of BORROW all you can and SPEND all you can.
Wednesday, Bear Stearns said it would put $1.6 billion—rather than the initial $3.2 billion announced last week—for the bailout.
This is 16 cents on the dollar, and the original market was ten cents on the dollar, before Bear-Stearns stepped in.
Given that $3.2 was 1/2 of their cash on hand, they most likely quickly discovered that saving a insolvent hedge-fund-bond was a waste of money. Besides the news of $3.2B made the news and accomplished the goal, which was to convince investors that they would NOT ALL lose their money.
The fact is they will all lose their money.
I cannot believe there will not be some depressing action on prices from this mega-glut.
The majority paid nothing down, thus there is NO ASK to cover the loan & 7% RE commission. You cannot sell that which you do not own.
There has to be enough equity to cover the realtor commission, and cover debt.
The problem is that the realtor's want a commission, otherwise there would be no listings. Perhaps someone who really wanted to sell and had a debt comparable to fair-market-value could sell for that the owe as FSBO, ...
Their best bet, is quit paying payments. Remember that in cali right now its up to 20-25% of MTG are over 60 days late, and Bend is just a suburb of cali.
I repeat again +20% of all MTG's are late over 60 days right now, that is why the Bear-Stearns CDO bond could only fetch 10-cents on the dollar. MTG paper right is not smart, but buyers are only offer 10% of face value.
It generally takes one-year to get you out, thus expect next summer to see the prices reflect the new Bend.
2008 we'll get the best picture of our new Bend, Oregon.
Be patient grasshopper, you have another year of posting, if you intend to post until we have hit the bottom.
In summary when facing foreclosure, its always best to wait them out until a court order, and get a year or two of free rent. This is how the game is played.
In my personal experience so far, only the pre-2001 homes have been selling, because those folks could and did drop 20% or more.
50% of all MTG's reset in the next year, most will go up 50-100% that's when the non-payment will sky-rocket to +50% over 60 days late. Thus 2009 will even see more empty houses, and then the prices will be really low.
What is the County of Deschutes Tax Man doing to plan for a complete loss of most revenue?
Tighten your belt, and enjoy the next two year ride.
"The majority paid nothing down,"
Show us where you get this figure...somehow I doubt you can...
"+20% of all MTG's are late over 60 days right now,"
Show us where you get this figure...somehow I doubt you can...
"50% of all MTG's reset in the next year,"
Show us where you get this figure...somehow I doubt you can.
Until then, STFU dimwit.
Bendbust said,
There has to be enough equity to cover the realtor commission, and cover debt
I'm sorry but you've got to be kidding me, I'm not giving one red cent to a freakin RE clerk, we sold fsbo last time and if we ever move again I will do it that way out of principal alone.
If one good thing can come of this housing debacale (sp) it is going to be a major overhaul of the RE business and how these sluts get paid. NO FREAKIN MORE 6% that's for damn sure.
NO FREAKIN MORE 6% that's for damn sure.
I hate to repeat myself, but I'm sure some folks know that by now.
1.) I'm only a buyer,
2.) I don't sell
3.) The seller pays the fee
4.) I work my realtor's ass off, I'm an asshole - anyone working for me deserves their fucking 7%
5.) I'm only a buyer,
WRT to selling, I don't sell RE.
I would NEVER sell FSBO, dealing with pathetic loser looky-looks, thats job for realtors; folks who like to talk shit to other shit talkers.
If folks really want to cut out a realtor it can be done, but I like having someone I can trust doing ALL my SHIT work, especially if the other guy is paying the bill.
Anybody working for me can expect to write a dozen or so low-ball offer's, when I'm done with them they deserve to get paid, and I sure in the hell don't want to be out there presenting offers. Look folks I offer 50% of ask, so when the deal has closed, the realtor has paid for him/her-self, with the other guys money.
sincereley, bend-bust.
Show us where you get this figure...somehow I doubt you can...
"+20% of all MTG's are late over 60 days right now,"
Read the fucking blog, this shit has been posted and re-posted too many times.
With all the interesting stuff going on why do people have to back track on old issues that are dead horses??
"Read the fucking blog, this shit has been posted and re-posted too many times."
Only by you, and never sourced. So again, show us where you get this figure...somehow I doubt you can.
"WRT to selling, I don't sell RE."
You must either have very few properties (less than 3) or many many mortgages. Which is it?
1.) I'm only a buyer,
2.) I don't sell
3.) The seller pays the fee
4.) I work my realtor's ass off, I'm an asshole - anyone working for me deserves their fucking 7%
5.) I'm only a buyer,
Bendbust you are so full of shit you make Dubya look sane and intelligent and that is pretty hard to do.
I'm sure you're crying a river since all your brown hommes can't have amnesty hince the immigration bill got shot down.
Since when did a RE clerks commission go to 7%, oh wait I know you pay that when it is your Mexican lover buying all your trailer park rentals. Way to go you are stud.
Now make sure you take a couple hits off the crack pipe and drink a few more beers before you post because we bloggers would be disappointed with anything less Biotch.......!
It's so nice when Mr. Meth has his fingers up his boyfriends butt.
It's look like tonight he's with us.
"It's so nice when Mr. Meth has his fingers up his boyfriends butt."
If you are referring to BendBust, I totally agree. He is a methhead, and loves to put his fingers up male asses.
I'm sure you're crying a river since all your brown hommes can't have amnesty hince the immigration bill got shot down.
Its one thing to be Bend-Nazi,
Its another thing to be Bend Republican,
But don't mother fucker fuck with the Latinos, otherwise who will clean up the mess on the floor at the end of the night when you and your boyfriend have made a mess of things??
Your fucking immy bill was just an attempt of Dubya to change the fucking subject. Fact is Immigrants are what made this fucking country, they're the ones that work, and always have worked. There might be a short time, like when it was legal to kill Chinese in Oregon, or there might be a time like when the US locked up Japanese. But the fact is long after the white-trash in the USA is extinct there will be immigrants coming to this land.
Fucking white trash like yourself, who feel that the reason they're not a brain surgeon is because a mexican took their job. If you yourself had a job, perhaps you could find a woman, rather than putting your fingers up other homeless men's butt's. It's a friday night, get off the computer, and go find your boyfriend.
yes, what this country desperately needs is more uneducated, meth-addled criminals from Mexico that will soak up our tax dollars through welfare all the while sending money back to mexico to help fund the next wave of illegal criminals jumping the border. yes, this is exactly what this country needs...if it wants to become as poor and helpless as mexico itself. all your latino brothers can find jobs slopping shit down there...why come up here, unless you think our shit smells better?
hmmmmm
Excuse me boys. But this blog is for discussing the bend-bubble.
There is a site ...
Bend Economy Bulletin Board
Which is exclusively for discussing buggery, beastiality, and republican cleansing. It is ran by the Bend Metrosexual League, a group of Bends finest citizens.
IHTBYB even has a link to "Bend Economy Bulletin Board" so pleeeze, take your conversation about meth, finger-banging, and general adolescent homosexuality over to that site.
BendBubble2
Debating the Bend Oregon Real Estate bubble, its implications for Bend residents, businesses, and the economic outlook for this area.
***
Where does immigration and meth have to do with our charter?
BendBust,
Why keep posting under all these pseudonyms? Everyone knows these are your posts...if you can't answer the questions posed to you, simply say so, instead of trying to anonymously change the subject...my god, you are such a coward that even on an anonymous bulletin board, you still shrink away with tail between legs.
I was talk with some Bond Traders from Portland last night, and their rather sure that the Portland Housing Market has hit its peak May/June 2007. These are bond traders that specialize in RE Bonds. There have been conference calls since the last two weeks when Bear-Stearns went south, and folks have been trying to determine value. All these MTG-Bonds have NO MARKET, all pricing is done on the phone. The basic gist is they think PDX has hit peak, which means NO MORE easy money for PDX. Time to Sell.
Another interesting tidbit about Portland I got from a realtor there is that the houses that have been moving are $500k-$700k, its been middle-class moving down, and younger moving up in sqft. The low end and high end has been at a standstill. This is important because the realtor's doing this trading range have been making money.
I'm mentioning PDX because the National story about PDX being exempt from the appreciation BUST will soon no longer be true. This will effect Bend as a liquidity dry-up, and equity drop, means less weekend purchaser's in Bend.
Lastly, WRT to Bend when the subject came up, like I thought. Most players of MTG Bonds are trying to get Bend MTG's out of the Portfolio. There are huge Fidelity Bond Funds that are taking a terrible hit.
In summary there will be no money for Bend for a long-long time. Wall Street is going to be forced out of the MTG biz, and its going to take team DUBYA a long time to get the banks back into the biz. Most likely we're talking 2009. During 2008 there will be much campaign talk about how to put the RE industry back together again.
Almost everyone that knows someone who knows a MTG broker, knows they're getting laid off. They seem to be getting six months termination packages. Smart ones had better find a new career during that time. Realtors are leaving the profession by the ton down in California.
Regarding the issue about 20% of MTG's being late, this is normally reported that over 1 in 5 MTG's are late in payment.
Current trend seems to be that 1/2 of all outstanding MTG's will reset during the next year, raising payments 50-100%. The reason MTG bonds have collapsed is that SMART folk can see that after reset the number of late-payments will jump to 2or3 of 5, e.g. +40%. Thus 2008 will be the year of pain, and then it takes a year to get them out, so by 2009 there will be a ton of empty homes. Just like the great depression.
You can expect bail-out talk for people during the 2008 election.
If we got rid of the MTG-INT deduction we could fix social-security. People will be suggesting that its time given that home-ownership was just a lottery play.
During the Great Depression, about 25% lost their homes, the government stepped in and offered low-interest loans to anybody that had income, this could happen again. I doubt it personally as many people will be shaking their heads at the notion of 'home ownership', why should the country bail-out speculators??
On this note watch China, they percentage that own their own home is 17%. They actually save real CASH, the Chinese have money. The US has had a negative saving's rate since 1998. Now the average US citizen is in Debt. The Chinese will be buying lots of US crap, and perhaps the Chinese will soon start having their low-end products made in the US by poor US citizens desperate for a job.
If we got rid of the MTG-INT deduction we could fix social-security. People will be suggesting that its time given that home-ownership was just a lottery play.- bendbust
Are you insane?
Get rid of the MTG-INT deduction
***
The point I'm trying to make is we have two major agenda's coming down.
1.) We must FIX the medical problem.
2.) We must FIX social security.
The fact that RE has become just a lottery play, and the fact that home ownership is the road to ruin will convince MOST people that its time to get rid of the MTG deduction. Besides when you don't have a job, write-offs are not that important.
My property's are paid for, so the MTG deduction does nothing for me. The current system ONLY rewards DEBT. The DEBT game is what created the mess that we're in today in Bend. Easy money, created insanity.
Expect MAJOR changes in the next two years. Lastly, the Republicans have screwed themselves BIG-TIME we're going to have a Democratic monopoly soon. The fact that Hillary & Obama are beholden to Wall-Street means that they'll not change the financial system.
In summary I believe that elimination of the MTG deduction could pay for a REAL US medical plan, the number one cause of bankruptcy in America. The elimination would also fund Social-Security which needs help ASAP.
Soon homes will be affordable in Bend to kids again ( 1-2 years ). People in 5-10 years will continue to move to Oregon, because the rest of the country...
a.) Is polluted
b.) Has no water
c.) Has racial explosion tension
People who have minimal debt, and income will survive the bust. In the long term Oregon will continue to be a good investment, e.g. until it becomes ...
a.) Polluted
b.) No Water
c.) Becomes a racist hate mongering, everyone at each other throat place to live.
The mortgage bonds must next be reset to lower ratings than ‘AAA’ which stands as an insult to the intelligence of a warm bodied investor with a pulse.
The significantly higher monthly mortgage payments coincide with the massive mortgage bond valuation declines. Just as foreclosure auctions essentially go ‘No Bid’ with 90% of the home inventory to move, the mortgage bonds have gone ‘No Bid’ with those auctions in the public view.
The people who have made the most money on this game since wall-street took over the MTG biz, are rating agency's like Moody and Standard&Poor,... The folks that normally grade assets, have been getting paid vast sums of money to stamp worthless paper with "AAA". Many of our money-markets, and CD's, ... today hold this paper that is worth MUCH less than its stated value.
Trust in our financial system is that a Grade "AAA" bond is just like a T-Bill, today what has been stamped "BBB" is now worth 60 cents on the dollar at best. What this means is that bond-holders have lost almost 1/2 their principal.
Sorry to step back from the bend-bubble. It is essential to think global, act local. While Bend is the most over-valued RE, we're also subject to the complete collapse of easy money. This perfect storm MUST be completely understood if you wish to survive.
Acting 'LOCAL' requires us to pressure our 'electable class' to the fact that the easy days of spending are over. Their job isn't going to be fun anymore.
On the GLOBAL all we can hope is that the RICH Chinese step in a by our fire-sale assets, as we as Americans cannot. If the Chinese do not step in and buy our assets at 10-50 cents on the dollar, then things will be dire for a long-long time.
why come up here, unless you think our shit smells better?
hmmmmm
I think we have found our poster-boy for our Bend-Nazi-Days.
SORRY TO BEND REALTORS -
I'm out of town this week. I was just eating dinner with some rich Texans who had come up to C.O. a couple years ago and played golf at Crosswater, Black Butte Ranch and a couple other places and they remarked to me "I wish I'd bought property."
I said, wait a couple years. Prices will come down and courses that are exclusive now (e.g., Broken Top) might go public by then.
The Bank for International Settlements issued a warning last week that the Federal Reserve's monetary policies have created an enormous equity bubble which could lead to another "Great Depression". The UK Telegraph says that, "The BIS--the ultimate bank of central bankers--pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system."
The IMF and the UN have issued similar warnings, but they've all been ignored by the Bush administration. Neither Bush nor the Federal Reserve is interested in "course correction". They plan to stick with the same harebrained policies until the end.
The "easy credit" which created the subprime crisis in mortgage lending has now spread to the hedge fund industry. The troubles at Bear Stearns prove that Secretary of the Treasury Henry Paulson's assurance that the problem is "contained" is pure baloney. The contagion is swiftly moving through the entire system taking down home owners, mortgage lenders, banks, rating agencies, and hedge funds. We are just at the beginning of a system-wide breakdown.
The problem originated at the Federal Reserve when Fed-chief Alan Greenspan lowered the Feds Fund Rate to 1% in June 2003 and kept rates perilously low for more than 2 years. Trillions of dollars flowed into the economy through low interest loans creating a massive equity bubble in real estate which drove up housing prices and triggered a speculative frenzy.
The Feds' "easy money" policy has disrupted the "debt-to-GDP" balance which maintains the integrity of the currency. By expanding circulation debt via low interest rates; Greenspan put the country on the path to hyperinflation and, very likely, the collapse of the monetary system.
The Housing Slump
Yesterday's housing data, shows that sales are still weak while inventory continues to grow. Existing home sales dropped 3% while prices dropped another 2.1%. Falling prices mean that cash-strapped home owners will not be able to tap into their home's equity for other expenses. Last year, mortgage equity withdrawals (MEWs) accounted for $600 billion of consumer spending. This year, the amount will be negligible at best.
The media and the Fed continue to mislead the public about the magnitude of the housing bubble. Fed chief Bernanke assures us that the sub prime calamity hasn't "spread to other parts of the economy" (tell that to Bear Stearns) and the media keeps cheerily reiterating that a "turnaround" or "soft landing" is just ahead.
These claims are ridiculous. Apart from the 80 or more sub-prime lenders that have gone "belly-up" in the last few months, the rickety collateralized debt obligations (CDOs) and mortgage backed securities (MBSs) are steamrolling their way through the stock market bowling down everything their path. Bear Stearns is just the first on the casualties list. There'll be many more before the storm is over.
Fed-chairman Bernanke knows what's going on. He was given a full rundown by "John Burns Real Estate Consulting that the national sales information for both new and existing homes, is "misleading and covering up a deep plunge of the housing sector." The housing market is freefalling. Existing-home sales are down 22% in May and mortgage applications have fallen a whopping 18%....In Florida home sales are down 34%, not 28% as NAR reported; Arizona sales are down 38%, not 28%; and California's down 37%, not 24% as NAR reports."
Down 37% in California!?! It's a landslide.
As the defaults continue to pile up; the hedge funds will take a bigger and bigger pounding. It can't be avoided. That's what happens when bankers abandon traditional lending standards and lend trillions of thousands of dollars to people who have bad credit and lie on their loan applications.
Thousands of these same shaky sub primes loans have been wrapped up like the Crown Jewels and sold off to Wall Street as CDOs. Now they are ripping through the hedge fund industry like a tornado in a trailer park. The media has tried to downplay the damage, but its not hard to see what is really going on. According to Reuters:
"Banks doubled the amount of CDOs outstanding in the past two years to $2.6 trillion, including a record $769 billion sold last year, according to J.P. Morgan. These figures include funded and unfunded issuance. Pimco's Bill Gross said there are hundreds of billions of dollars of subprime residential mortgage-backed securities (RMBS), derivatives on subprime RMBS and collateralized debt obligations (CDOs) that buy subprime RMBS and/or the derivatives on the RMBS -- all of which he considers "toxic waste."'
"$2.6 trillion"! That's enough to bring down the whole economy. And, as Bear Stearns proves, the whole mess is beginning to unwind pretty quickly.
"Foreign investors have been the dominant buyers of these exotic debt instruments in recent years, owing to their insatiable demand for yield. If investors start dumping them, oh boy, watch out for some massive credit widening," said Dan Fuss, Vice Chairman at Loomis Sayles. (Reuters)
If the hedge fund industry follows the downward slide of the housing bubble, foreign investors will run for the exits. In fact, this may already being happening.
China sold $5.8 billion in US Treasuries in May; the first time they have dumped USTs on the market. This may be the first sign of "capital flight"---foreign investment fleeing the US for more promising markets in Asia and Europe. The greenback's survival now depends on the generosity of foreign bankers. If they refuse to recycle our $800 billion current account deficit by purchasing US bonds and securities, then the dollar will sink like a stone and lose its place as the world's reserve currency.
In what follows is very interesting analysis of how government lies about population.
We know that people are leaving Bend, we know that Bend is too expensive for the average person. They're leaving, but our electable-politicians keep spending money based on GROWTH. The story follows tell's the real story that is happening. Note their is no growth Bend, only annexation, which those people don't want.
***
In a Wall Street Journal report, on June 26th, Michael Corkery wrote, "Many analysts believe home supplies will decrease and prices will stabilize, only after builders shed their unwanted land."
But in Miami-Dade the production home builders and land speculators are still jumping up and down, burning through their cash, and the commissioners are nodding in syncopating rhythm: we need zoning changes and building approvals because more people are coming in to Miami and Florida.
Not now.
All but one of nine Miami-Dade school districts are losing students, a perceptible annual rate on the order of five to ten percent. This is news roundly ignored by Miami city and county commissions.
People are moving, although it hasn't risen to the threshold of Africans fleeing an angry, unrelenting climate. In Miami, the hissing from the housing bubble bursting is perceptible.
As bad as the decline in school enrollments may be, it is still considerably less than the number of Miami homeowners in the clutch of mortgages they may not be able to afford for much longer, residents who would like to move to less expensive locales and are keeping their kids in public schools, holding on and praying for housing values to reverse.
But in Miami-Dade the production home builders and land speculators are still jumping up and down, burning through their cash, and the commissioners are nodding in syncopating rhythm: we need zoning changes and building approvals because more people are coming in to Miami and Florida.
Not now.
All but one of nine Miami-Dade school districts are losing students, a perceptible annual rate on the order of five to ten percent. This is news roundly ignored by Miami city and county commissions.
Remember Florida used to be #1 in over-value, does the above sound like Bend or what? We're SERIOUSLY over-built, and what does our poly-tick-ians want?? They want to build us out of the bust. This defy's logic. There must be a moratorium on building, we must clear the inventory, and we must determine exactly what the population really is, excluding annexation.
{ A little thought on other tourist towns that are like Bend }
Duncan,
Long ago I called you Ned Flanders, because like the Simpson's character to me you remind of that all to nice Christian character next door.
I say if you have a shop downtown, then as the Romans would say, "When do Rome, do as the Romans".
Its quite silly to be in "The Shire", "Bend as Aspen", and not to be selling high-end crap to tourists.
Given that the entire downtown is ONLY about separating money from tourists then that is what you should be doing.
Otherwise why be there?
I know your a nice guy, .... blah-blah, but nice guys finish last in a tourist town like Bend.
For instance you call the people in the street out of towner's selling elephant-ears, but I guarantee you that they're of town, they work the summer in the street, and spend winter in down in Mexico.
It's the same way in Friday Harbor, WS, e.g. San-Juans. It's all about tourism, just like Bend. What MOST people do is sell Fish&Chips on the street from May-Sep, and then spend Oct-Apr at their Mexican Hacienda.
If YOUR not playing this game, then what the hell are you doing in a tourist-town???
Let's MAKE perfectly clear that Bend is just a nasty little tourist town just like Friday Harbor. Real Estate and Cotton Candy. Just like Sisters.
Perhaps you need to focus more on internet sales? Websites, ... You obviously like to spend several hours/day on the computer, perhaps you need to create the greatest card-shop in the world on the internet??
The below paragraph is a re-post of a prior paragraph, now our little adolescent moron, has learned to take previous responses, and turned them into questions, and previous questions into responses. Very original.
Why don't you cut&paste material from this site, and create a your own site, then provide us the link, and we'll give you feedback? Hows that for a cool project?
Remember Florida used to be #1 in over-value, does the above sound like Bend or what? We're SERIOUSLY over-built, and what does our poly-tick-ians want?? They want to build us out of the bust. This defy's logic. There must be a moratorium on building, we must clear the inventory, and we must determine exactly what the population really is, excluding annexation.
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