skip to Main Content
thehousingbubble@gmail.com

An Interesting Signal About Demand And Value

It’s Friday desk clearing time for this blogger. “The Commerce Department said on Friday new home sales dropped 12.8% to a seasonally adjusted annual rate of 635,000 units last month. It was the biggest monthly decline since July 2013. The median new house price was $312,800, down 4.5% from a year earlier. There were 337,000 new homes on the market last month, up 1.2% from June. At July’s sales pace it would take 6.4 months to clear the supply of houses on the market.”

“Foreign investors purchased $77.9 billion in residential property in the 12 months ending in March, down 36% from the previous 12-month period, the National Association of Realtors said. Meanwhile, more Chinese homeowners have been selling their American houses and condos because they can’t pay the maintenance costs with their money trapped in China, says Jeff Lu, vice president of Fidelity National Title Insurance Company. In Irvine, population 280,000, ‘There are 65,000 houses… and 21,000 of them are owned by Chinese.’ Lu says.”

“The pullback is depressing prices. In the first half of the year, the median home sale price in Irvine fell to $820,000 from $834,000, according to Zillow. ‘It’s good news for local Americans who are looking to buy a home – larger supply and less competitors,’ Lu added.”

“Barack and Michelle Obama may be buying a place on Martha’s Vineyard. The manse has been on the market since August 2015, when it was listed for a whopping $22.5 million, before plummeting to $16,250,000, according to a realtor.com article from last year. Now, it’s on the market for $14,850,000, but, says TMZ, ‘the Obamas are apparently paying less.'”

“With so many NYC homes not finding buyers, there is a continued glut of for-sale inventory. On top of the existing surplus, new inventory increased in all three boroughs analyzed, led by Queens, where 877 new homes came onto the market. Total for-sale inventory in the borough reached a new high of 3,610 homes, up 22.5% from last year.”

“‘It’s typical for the number of price cuts to dip during the summer, when many sellers skip town and shift their focus away from selling their homes,’ says StreetEasy EconomistNancy Wu. ‘But for motivated sellers, now is actually the time to offer discounts and help prospective buyers otice your property. With the return of home-shopping season this fall, and a wave of new homes coming to market, sellers will soon have even more competition, making additional price cuts — possibly at record levels — virtually inevitable.'”

“A Miami-Dade judge ruled the developers of Regalia, a luxury condo tower in Sunny Isles Beach, must turn over 100 percent interest in the companies that own the remaining two – and most expensive – unsold units, The Real Deal has learned. Josh Migdal, a partner at the Miami law firm Mark, Migdal & Hayden, who is not involved in litigation involving Regalia, said the order to give up ownership interest in the company that owns the remaining units gives ‘an interesting signal about the demand and value of the units.'”

“‘If there was demand for the units at value sufficient to satisfy the judgment and leave some profit, then the developer would have chosen that path,’ he said.”

“Since April, 2017, the price of a detached house in the GTA has fallen approximately 15 per cent from its peak, Cameron Forbes, general manager of ReMax Realtron Realty Inc., says. Real estate agent Matthew Regan believes that sellers are beginning to see the importance of setting the right asking price for a property. ‘It has taken a while for some sellers to sober up from the price acceleration of 2017,’ he says of the first quarter of that year, when prices were running 30 per cent ahead of the same period a year earlier.”

“These days, homeowners who insist on setting a 2017-level asking price won’t sell quickly, he says. ‘If the house is overpriced, it’s going to sit.'”

“Sakina Hassanali, head of development consulting at real estate firm Hass Consult, is not a big fan of the phrase ‘property bubble burst’ in relation to the Kenyan situation. And she is not alone, many real estate stakeholders have previously been at pains to dissociate what has been variously referred to as a slump or market slowdown in local market from the more ominous term, bubble burst.”

“‘In Kenya, we’re not at any risk of a bubble, what we’re at risk of is just a slow down. And this and we can see it in the figures. In the last quarter the property prices went down three per cent,’ she said.”

“Some mainland Chinese investors who bought properties in Hong Kong at high prices several years ago have panicked amid souring sentiment and sold at big losses of up to HK$8.2 million. At least four properties have been sold in such panicked behaviour since July. ‘Mainlanders are interesting. When they want to sell flats, they would not think so much and want to sell it immediately,’ said Hendrick Leung, director at Centaline Finance.”

“National Australia Bank faces a lawsuit from the corporate watchdog over a scandal involving its use of home loan ‘introducers,’ in a landmark case that could attract a maximum penalty of more than $500 million. Daniel Crennan , who is ASIC’s top enforcer after the regulator has been criticised for being too timid, described aspects of the bank’s system in relation to introducers as ‘broken,’ pointing to documents that included false signatures and false payslips.”

“‘There will be other cases in coming weeks and months, certainly before the Christmas, there will be a significant number of cases that relate to the royal commission being issued,’ he said.”

“It’s not a typo. A discount of up to $10 million is on offer for deep-pocketed buyers looking at this super-luxury East Melbourne apartment. The oversized residence on level 11 of the sought-after 150 Clarendon development was listed for sale in May with eye-watering price hopes of $46 million. But the home’s price guide has now been dropped to $36 million to $39.6 million.”

“Listing agent Marty Fox declined to comment when contacted by Domain. When the property first hit the market, Domain asked if he thought the home would sell for its $46 million price tag, to which he responded at the time: ‘The price is $46 million.'”

“We are a decade into a global economic experiment that is certain to fail. This will come as a surprise to the likes of Reserve Bank Governor Adrian Orr, who recently told Jack Tame: ‘economic growth will be picking up.’ He’s wrong. When the wheels fell off the economic machine back in 2008 central banks tried to solve the world’s economic malaise by cutting interest rates.”

“Orr, and his fellow central bankers, have created an economic bubble with a decade of cheap money. They are desperately trying to keep it afloat with ever larger amounts of more cheap money. It is possible that they can keep this going for a while longer, but they cannot keep it going forever.”

This Post Has 174 Comments
  1. ‘But the home’s price guide has now been dropped to $36 million to $39.6 million…Listing agent Marty Fox declined to comment when contacted by Domain. When the property first hit the market, Domain asked if he thought the home would sell for its $46 million price tag, to which he responded at the time: ‘The price is $46 million’

    Stamp yer little feet Marty!

  2. ‘Meanwhile, more Chinese homeowners have been selling their American houses and condos because they can’t pay the maintenance costs with their money trapped in China’

    Nobody could have seen that coming…

    1. From Wikipedia …

      “In 2016, Irvine became the largest city in the continental United States with an Asian American plurality, constituting around 45% of the city’s population.”

      Demographic profile 1980 1990 2000 2010
      White 87.8% 77.9% 61.1% 50.5%
      —Non-Hispanic 84.5% 73.9% 57% 45.1%
      Black or African American 1.5% 1.8% 1.5% 1.8%
      Hispanic or Latino (of any race) 5.8% 6.3% 7.4% 9.2%
      Asian 7.8% 18.1% 29.8% 45.1%

      1. Billionaire$ Donnie Bren of Thee.Irvine Co., makes Don.thee.CON tRumpsis wanna.bee$ a Billionaire$ … look like a right.coa$t Piker

        1. Don.thee.CON tRumpsis wanna.bee$ a Billionaire$ ??

          He wasn’t a billionaire before he entered office but I bet he will be by the time he leaves…

          1. Bugs: “eh, could bee Doc!”

            but there will bee a no.hold$.Barr, lookin’ into to those $orta things iffin’ he fails to body.slam “Oh, Nancy Pelosi & Co.” in 2 020.

      2. Wow, that is very interesting! The most conservative bastion in California has been transformed into an Asian population. I wonder where the sellers moved? Texas? Idaho?

      1. I didn’t know those still happened.

        I still see empty homes with faded foreclosure in the windows and on front doors in my small town. There’s no shortage of contractors around here either, so something is keeping these “fixers” off of the market.

  3. ‘sellers will soon have even more competition, making additional price cuts — possibly at record levels — virtually inevitable’

    Record levels. And prices in NYC have been sinking like a turd in a well for over three years. Are we there yet?

    1. What was the US savings rate prior to the late 2007, recession? One measure was around 3.5 percent. Now by the same measure it is around 8.5 percent. It has been above 7 percent for sometime. The MSM has been beating the upcoming recession prior to Trump even getting elected. If he was elected it would cause a recession, is what they were saying. The problem, for them, is by crying wolf for so long they have reduced the chance for recession and reduced the severity of one of it comes due to the increased savings.

      1. Yer Delu$ional $1dollar.store ro$e.colored gla$$es are glo$$ing over what’s right in front of yer face:

        American corporation$ & con$umers are up to their red.blood.$hot eyeball$ in debt$ (including $helter.$hack.hou$ing)

        1. Vice Chair of the Fed just stated the US economy is in a good place. However the global economy is slowing. Since China’s economy on A PPP basis is substantially bigger than the US, it makes sense. It will be difficult for countries which depend on selling to China, it takes almost half the imports of some commodities, however its slowdown does not necessarily cause a recession here. A total collapse might but it would be worth eliminating the threat to us. The 21st century would be an American one if it does happen. The multinational corporations are impacted by weaknesses in other countries so their correction today in the stock market makes sense.

        2. Sorry, not buying this ??

          Not buying what ?? The post by Hwy or the post by “The OZ of Albuquerque” ??

          1. I’m not sure I buy any of it. Everyone is just speculating at the moment. No one has any clue what’s going to happen, except that the little guy is going to get pounded, as usual.

          2. There are some bigger guys who are likely positioned to become little guys as this mess unravels.

            “I like big fat men like you. When they fall they make more noise. And sometimes they don’t get up. ” —Tuco, the Good, the Bad and the Ugly.

      2. If you max at the graph, you can see that the savings rate now is much higher than before the 2007 recession. The MSM in its efforts to get Trump has probably ensured that the recession will be after the election: https://tradingeconomics.com/united-states/personal-savings

        It is very similar to how they initially promoted Trump in 2016 because they thought he would be a much weaker candidate than Jeb.

  4. “Some mainland Chinese investors who bought properties in Hong Kong at high prices several years ago have panicked amid souring sentiment and sold at big losses of up to HK$8.2 million. At least four properties have been sold in such panicked behaviour since July. ‘Mainlanders are interesting. When they want to sell flats, they would not think so much and want to sell it immediately,’ said Hendrick Leung, director at Centaline Finance.”

    Still cheaper than renting 🙂

    1. With venture capital throwing money at “green energy,” I’m trying to devise a generator that will harness the kinetic energy unleashed by the stamping of little feet.

  5. The End of Bidding Wars?
    New York Times
    By Michael Kolomatsky
    22 August 2019

    “Bidding wars in real estate markets across the nation are becoming increasingly rare, according to a new study by the real estate brokerage Redfin. The company reported that only 11 percent of the properties for which its agents submitted offers in July saw multiple bids, down from 46 percent a year earlier. That’s the lowest share Redfin has seen since 2011.”

    1. “for which its agent$ $ubmitted offer$ in July saw multiple bid$, down from 46 percent a year earlier.”

      “Wor$er & wor$er” … Mr. Ben Jones

      1. A completely fabricated lie? Really? All of them? They may be irrational and foolhardy, but they are (were) a very real thing. I have seen it first hand, not by rumor or speculation. Good to hear they are fading away…

        1. There were occasional events for properties with competitive potential, but avaricious realtors and their enablers in the media hyped it to death as if every time a house was listed there was going to be this mad rush to be the buyer who “won”. Diana Olick in particular humped this trope every chance she got.

      2. I created one on purpose the last time we sold a place.

        – Listed $20K below the used home seller’s suggested list price.

        – Attracted five offers and accepted the highest one $10K above the used home seller’s suggested list price.

    2. Falling prices don’t tend to engender bidding wars.

      Rather they sow the seeds of inventory gluts, protracted times on the market, and relistings as new at lower prices.

  6. Eye like$ it, eye love$ it, eye want$ more of it!

    “Orr, and his fellow central bankers, have created an economic bubble with a decade of cheap money. They are de$perately trying to keep it afloat with ever larger amount$ of more cheap money. It is possible that they can keep this going for a while longer, but they cannot keep it going forever.”

    FEDERAL RE$ERVE
    The Fed will cut rate$ five more times before April, analy$ts predict

    CNBC | Elliot Smith |PUBLISHED TUE, AUG 20 2019

    ‘The monetary future of Japan’

    “Ultimately, I think investors are going to have to prepare themselves for the monetary future of Japan,” Jakobsen said.

    The Bank of Japan has long been pursuing unconventional monetary policy with its economy being plagued by low inflation for decades. The country suffered what has become known as a “lost decade” to deflation, when companies cut their prices to revive lackluster demand, which in turn hit businesses’ revenue and had a knock-on effect on the economy.

    “I think it’s ironic that no-one learns from history. Everything Japan has ever done has been repeated by the ECB (European Central Bank), the Federal Reserve and the Bank of England, so we know what the future is.”

    He suggested that the U.S. and Europe are “zero-bound” as long as economies continue to operate a “pretend and extend” model. This approach brings forward benefits or gains, often reliant on cosmetic solutions, while deferring risks or potential costs into the future.

    -CNBC’S Jeff Cox contributed to this report.

    1. “I think it’s ironic that no-one learns from history.”

      Wrong! What that has been learned from history is the game can be prolonged and this is when lots of money can be extracted.

      “Everything Japan has ever done has been repeated by the ECB (European Central Bank), the Federal Reserve and the Bank of England, so we know what the future is.”

      We don’t live in the future, we live in the now. If the future has to be sacrificed for the now then so be it.

      (Think: Party on, Garth.)

      “He suggested that the U.S. and Europe are ‘zero-bound’ as long as economies continue to operate a ‘pretend and extend’ model.”

      Again, we live in the now. Extend and pretend extends the now.

      “This approach brings forward benefits or gains, often reliant on cosmetic solutions, while deferring risks or potential costs into the future.”

      You’ve got it.

      Party on, Garth.

        1. “Indeed, Mr. Banker. And greedy fools will always be easy pickings for scammers and con artists.”

          You’ve got that right. And while you are here I would like to inform you of an investment opportunity that deals with purchasing the contents of abandoned safety deposit boxes located in my bank vault.

          For security reasons and to protect your interests I will need you go send to me ALL the particulars of your life, especially those particulars that have to do with your finances.

    2. “They are de$perately trying to keep it afloat with ever larger amount$ of more cheap money. It is possible that they can keep this going for a while longer, but they cannot keep it going forever.”

      I never thought they could reinflate the bubble, much less for a duration longer than the first. In turn, I have absolutely no idea what is going to happen. I could be dead before this ends.

    3. I think the US debt levels will almost guarantee zero interest rate policy (ZIRP) from now on because to get even close to normalcy will result in too much of the treasury revenue to go to interest payment. They will force interest rates down as a way to cope with an a debt trajectory that is becoming unmanageable.

      1. There’s no return to normalcy without huge write-downs of outstanding debt, so the country is now “eating its own” as it struggles to find a politically safe exit strategy.

        1. PS The lower interest rates go, the greater the moral hazard incentive for governments and private borrowers to load up on as much debt as possible. And the situation worsens if rates go negative, as borrowers can gain by borrowing and repaying less than they borrowed. Hence the magnitude of outstanding debt will naturally tend to grow at an ever-increasing rate as interest rates go ever more negative.

          Where does this all end!?

        2. Why not put your FOMO to good use and capture some of this central bank funded gravy flow?

          That near–$17 trillion pile of negative-yielding global debt? It’s a cash cow for some bond investors
          Published: Aug 22, 2019 2:14 p.m. ET
          Bloomberg News/Landov
          A stack of 10 euro bank notes is arranged with 50 and 20 euro bank notes. Bloomberg
          By Joy Wiltermuth
          Markets reporter

          Buying into the near–$17 trillion heap of global bonds with negative yields might sound like a losing proposition. But for some investors — those who predicted correctly that bond prices this year would climb amid worries about sluggish global growth — negative yields actually have been a cash cow.

          “There is a big misunderstanding about negative-yielding debt,” said James Bianco, founder of Bianco Research, in an interview with MarketWatch. “Owners of these bonds have been seeing huge price increases.”

          With bond prices moving in the opposite direction of yields, the sharp yield decline this summer, as the U.S.-China trade war has raged and American recession fears have bubbled up, has put significant price gains on the table.

        3. Would you rather incur massive losses on risk assets, like stocks or real estate, or make huge gains on flight-to-quality investments in super-safe sovereign debt?

          This bond-market strategy returned more than 30% this year in a sea of negative yields
          Published: Aug 23, 2019 1:35 p.m. ET
          Momentum traders have piled into long-term government bonds even as prices rise to eye-watering levels
          By Sunny Oh

          One group of fixed-income traders have capitalized on the rip-roaring rally in government bonds that has driven their yields below zero.

          So-called momentum traders that bet and ride on the continuation of price trends have thrived in part because they don’t care as much about how the U.S. economy fares because of the U.S. trade war with China or what the Federal Reserve will do in the coming months.

          Such investors have profited from the one-way rally for government debt this year, and have been more than willing to jump into bullish trades using bond futures even as others remained skeptical that yields could go lower or even turn negative this year.

          Société Générale’s index for trend-following strategies focused on the bond market have gained around 34% year-to-date.

          “Certain fundamentals don’t make sense in a world of negative yields,” said Kathryn Kaminski, a portfolio manager for AlphaSimplex, a managed futures fund which employs trend-following strategies.

          The swathe of negative yielding bonds have nearly doubled this year to $16 trillion, mostly across Europe and Japan, according to Bloomberg data.

          Kaminski said the success in trend-following strategies contrasts with the broader view in Wall Street that the U.S. and global economy has not deteriorated to merit the magnitude of the rally in government bonds. Expectations among Wall Street banks that rates had no room to fall further have been repeatedly challenged this year, forcing them to revise their forecasts time and time again.

          The 10-year yield for the U.S. Treasury note (TMUBMUSD10Y, -4.88%) and the German government bund (TMBMKDE-10Y, -4.80%) have given up more than 90 basis points since the start of the year.

  7. Talk ’bouts being $queezed between a rock & a “hard.brick.place”! Yike$!

    Double jeopardy for retailer$: the online menace and rece$$ion

    MarketWatch | Andrew Riquier |Published: Aug 23, 2019

    Will retail $tock ETFs de$igned to profit from wave of brick-and-mortar $hutdowns outperform in a recession ?

    (Well, there ya goes, ya can have it both way$!):

    “We like to say the con$umer lead$ us into rece$$ion and the consumer leads us out of recession,”

    “However, online retailer$ should with$tand the next rece$$ion much better than traditional retailer$ given lower overhead expen$es,”

    (Ya think?)

  8. ‘New Left Urbanists’ Want to Remake Your City

    https://www.wsj.com/articles/new-left-urbanists-want-to-remake-your-city-11566512564

    ‘These activists have big dreams. They want local governments to rebuild the urban environment—housing, transit, roads and tolls—to achieve social justice, racial justice and net-zero carbon emissions. They rally around slogans such as “ban all cars,” “raze the suburbs” and “single-family housing is white supremacy”—though they’re generally white and affluent themselves, often employed in public or semipublic roles in urban planning, housing development and social advocacy. They treat public housing, mass transit and bike lanes as a holy trinity, and they want to impose their religion on you.’

    ‘Activists are concerned not only with the quantity of new housing but also with who builds and lives in it. New developments must be government-run and tick off the boxes of identity politics. In San Francisco, some activists oppose all private housing construction. A 2017 essay in the San Francisco Examiner called advocates for more market housing part of a “libertarian, anti-poor campaign to turn longtime sites of progressive organizing into rich-people-only zones” and compared them to white nationalists.’

    Kinda loses it’s ummph when you say it all the time.

    1. ” …they want to impo$e their religion on you”

      No rea$on to fret, all they got meself to sign up fer is: scratch a gra$$ lawn & place a brick in the toilet.

    2. One set of rules for them, and another one for you. We’ll settle this with violence when the time comes.

      1. One side is armed to the teeth and the other side can’t figure out which bathroom it wants to use. Maybe the radical left shouldn’t push their luck.

        1. the other side can’t figure out which bathroom it wants to use….

          They don’t say explicitly but it’s the one your children are in.

        2. One side is armed to the teeth and the other side can’t figure out which bathroom it wants to use.

          Can people who can’t start a lawnmower start a revolution?

      2. Antifa is LARPing 1968. These soybois couldn’t punch their way out of a paper bag.

        Where does the FOOD in the U.S. come from?
        Where does the ELECTRICITY in the U.S. come from?

        LOL@ living in a densely populated coastal area.

        1. “living in a densely populated coastal area.”

          CA is thee large$t commoditie$ grower in the whole U$ofA. (as.in.period!)

        2. LOL@ living in a densely populated coastal area..

          I suspect I’m the only person on my block who takes prepping even semi-seriously…

          1. dilbert.com/strip/2011-07-31

            Yup. I don’t talk about it with neighbors. I just consider ‘what if I had to hole up at home for a week/30 days/60 days’

          2. I suspect I’m the only person on my block who takes prepping even semi-seriously…

            Have a HAM license? We should form an alliance 🙂

          3. Have a HAM license? We should form an alliance

            Not had the time… yet. but it’s interesting you mentioned that. I was updating my lists of what should be necessary to have around, and was looking at communications – we haven’t been this vulnerable in decades. Lose the net and digital TV… not much analog left. HAM and other communication devices were added to the list.

      3. The same people who preach the “RESIST” stuff are the first ones to surrender their firearms to the government. Can’t make this stuff up.

          1. No, but if the people in Hong Kong were as well armed as we are, it would be a different story, wouldn’t it? That situation also show why a bunch of little pop guns ain’t gonna cut it.

          2. “And how we burned in the camps later, thinking: What would things have been like if every Security operative, when he went out at night to make an arrest, had been uncertain whether he would return alive and had to say good-bye to his family? Or if, during periods of mass arrests, as for example in Leningrad, when they arrested a quarter of the entire city, people had not simply sat there in their lairs, paling with terror at every bang of the downstairs door and at every step on the staircase, but had understood they had nothing left to lose and had boldly set up in the downstairs hall an ambush of half a dozen people with axes, hammers, pokers, or whatever else was at hand?… The Organs would very quickly have suffered a shortage of officers and transport and, notwithstanding all of Stalin’s thirst, the cursed machine would have ground to a halt! If…if…We didn’t love freedom enough. And even more – we had no awareness of the real situation…. We purely and simply deserved everything that happened afterward.”

            ― Aleksandr I. Solzhenitsyn , The Gulag Archipelago 1918–1956

          3. Then tell your beloved Antifa out in Portland to start setting an example.

            Why would you assume I align with Antifa? I am for anyone who wants to express their ideas peacefully. I condemn violence, especially gun violence. Having said that, I haven’t heard of any killings liked to Antifa. However, I seem to recall a young woman who life was taken in Charlottesville and a couple of mass shootings a couple of weeks ago in the name of race. So you tell me who we should be concerned about.

          4. Passive resistance works in decent societies run by decent people. It does not work against people like Mao, Stalin and Hitler. Those type of people have no problem shooting unarmed peaceful people who oppose them. Most people will shoot people who are a threat to them, but will not shoot people who are blocking a driveway. Thus, the founding fathers gave us the right to own guns, not for the primary purpose of self defense or hunting although those were important but to have the ability to overthrow the government. Both the first amendment and the second amendment are in danger today.

          5. Both the first amendment and the second amendment are in danger today.

            With smartphones and smart speakers, I’d add the fourth amendment.

          6. “Hong Kong police hit a protester on the head…”

            He could have thrown a brick for all we know. Good thing it was frontal lobe and face blow rather than the backside inion where the motor functions reside.

          7. Passive resistance works in decent societies run by decent people.

            You should read the research posted in the link above as it provides plenty of counter examples in multiple examples where nonviolent protests do work in non-decent, authoritarian states.

        1. “…civil resistance campaigns often lead to longer-term reforms and changes that bring about democratization compared with violent campaigns. Countries in which there were nonviolent campaigns were about 10 times likelier to transition to democracies within a five-year period compared to countries in which there were violent campaigns—whether the campaigns succeeded or failed. This is because even though they “failed” in the short term, the nonviolent campaigns tended to empower moderates or reformers within the ruling elites who gradually began to initiate changes and liberalize the polity.”

    3. Elie Mystal, executive editor of Above The Law, shared his opinion on how to beat Trump in the upcoming election, at MSNBC

      “You don’t communicate it to them — you beat them. You beat them. They are not a majority of this country. The majority of white people in this country are not a majority of the country. And all the people who are not fooled by this need to come together, go to the polls, go to the protests, do whatever you have to do. You do not negotiate with these people, you destroy them”.

      1. The liberal meme says, “accommodation and inclusion.” However, the reality is, “You do not negotiate with these people, you destroy them.”

    4. In WA state, it’s through the “growth management act” or some such. They essentially shut down new development in rural areas to “protect the environment” and force people into the urban centers. Sucks that you bought those 5 acres with hopes of drilling a well and building a house. Oh, well, time to go to the city!

    5. “—though they’re generally white and affluent themselves, often employed in public or semipublic roles in urban planning, housing development and social advocacy.”

      All animals are equal, but some animals are more equal than others.

      — George Orwell, Animal Farm

    6. It’s all fun and games to plan these utopias, but nobody talks about *maintenance,* just keeping things neat and clean and decent repair. That takes time, money, and motivation. And most of the time it fails. You can see this in everything from a kid’s bedroom to a church kitchen to project towers to entire developing countries. Set it up, but if you don’t maintain it, down it goes.

      So go ahead libs, set up all the bike lanes and green space and community gardens and 3-level co-ops you want. Stock it with your desired quotas of diversity. And then wait five years.

  9. “…Nobody could have seen that coming…”

    Nobody except the HBB.

    I would bet that the first postings in HBB about this exact scenario (in particular Irvine) go back at least 3 possibly 5 years.

    Guess spending $3mm++ on that house in Turtle Rock/Shady Canyon [in Irvine] and letting it sit empty wasn’t such a great idea after all.

  10. Just looked at the new housing sales numbers. What is up with the government data? Wild revisions every day. so the June number was revised up from 646,000 to 738,000. This made it appear that we had a 12.8 percent drop in construction, when the July number came in at 635,000 but if you use the original number it is around a 2 percent drop. Moreover the July number is still 4.3 percent higher than last year. The government economic data is starting to look like the government’s climate data. Quite suspicious with the revisions serving a political agenda.

  11. In Irvine, population 280,000, ‘There are 65,000 houses… and 21,000 of them are owned by Chinese.’ Lu says.”

    No, Lu. Until the last mortgage payment clears, the bank owns those houses. And the Chinese who overpaid won’t think twice about skipping out on their financial obligations and winging back to China once those shacks go underwater. The Irvine foreclosure auctions are going to be ripe pickings for the patient and prudent.

    1. And after the last mortgage payment is made, the government owns the house, and sends the renter a massive tax bill each year. Fail to pay it and they take their house back.

  12. “Sakina Hassanali, head of development consulting at real estate firm Hass Consult, is not a big fan of the phrase ‘property bubble burst’ in relation to the Kenyan situation.

    No realtor anywhere on the planet wants to acknowledge bursting housing bubbles. Doesn’t change the facts one bit, though.

    “Right now is most emphatically not a good time to buy,” said no realtor anywhere, ever.

    1. “…Doesn’t change the facts one bit, though…”

      “Facts do not cease to exist because they are ignored.” – Aldous Huxley

    2. “It’s always a good time to buy and sell.”

      That’s probably their most nauseating line ever.

  13. Recent data on San Diego housing market. Rich T usually posts good data. But I can’t get my head around the first chart showing that 2005/6 prices were much less affordable than current prices. Median SD income was 72k in 2006 and is 76k now. It’s barely budged. And median home prices have surpassed the 2005 highs. Median single family home was 572k in 2005 and is 628k for 2019 which makes the prices to income ratio about 8.3 for 2019 and 7.9 for 2005/6. Interested in others’ thoughts. Also I remember looking at properties in 2005/6 and equivalent properties in the same neighborhoods are selling for significantly more now than they were then. Rents are significantly higher. Would that account for that much of a difference to offset the actually increase in the price to income ratio?

    https://www.piggington.com/shambling_tiny_halting_step_towards_affordability

    http://laalmanac.com/economy/ec37.php

    1. Rich’s valuation calculation is the San Diego Case-Shiller home price index divided by equal-weighted San Diego rent and per-capita income. So yes. My problem with his valuations is that they neglect possibly different drivers behind home prices and rents.

        1. “Today, the typical sale price of an existing single-family home in the Seattle area is 5.7 times greater than the median household income, up from 2.5 times in 1988, according to the Harvard Joint Center for Housing Studies.”

          Move along folks…nothing to see here.

          1. The only way to make the math work is to have two well-paid wage earners (Elizabeth Warren’s two-income trap highlights this problem very well).

            The next phase in housing affordability is that two wage earners will be insufficient to pay the bills. Housing must be an ever increasing percentage of both earner’s income and family sizes much shrink children are super expensive and caring for them takes away from paying the mortgage debt.

          2. The next phase in housing affordability is that two wage earners will be insufficient to pay the bills.

            Next is 2 wage earners AND a negative interest rate mortgage on a multi-million dollar 3/2/2 (that was built for 100k) required to survive?

    2. “But I can’t get my head around the first chart showing that 2005/6 prices were much less affordable than current prices. Median SD income was 72k in 2006 and is 76k now. It’s barely budged. And median home prices have surpassed the 2005 highs.”

      I like Rich and admire his successful entry into a career track position in the FIRE sector.

      But I frankly wouldn’t trust my own data analysis if I worked there. The potential gains to profit by misleading the masses are too tempting to resist.

    1. Never.

      However, the WSJ writers oddly enough closed their eyes to them for a while, only to recently reopen them.

  14. This seems like fake news at this point. I couldn’t find any details, and it’s written in a manner that makes it seem like Trump is talking about eliminating both altogether. Read the comments, the scare tactics worked.

    “Republicans on Capitol Hill say Donald Trump may be willing to cut Social Security and Medicare if he wins in 2020, reportedly describing the potential move as a “second-term project”.”

    https://www.yahoo.com/news/trump-tells-republicans-may-begin-162457862.html

    1. Fake news indeed…

      Sen. John Barrasso (R-Wyo.) told the Times that his party has discussed cutting Medicare and Social Security with Trump and said the president has expressed openness to the idea.

      “We’ve brought it up with President Trump, who has talked about it being a second-term project,” said Barrasso.

      Senator John Thune (R-S.D.), the number two Republican in the Senate, echoed Barrasso, saying it is “going to take presidential leadership to [cut Social Security and Medicare], and it’s going to take courage by the Congress to make some hard votes. We can’t keep kicking the can down the road.”

      Those tax cuts aren’t going to pay for themselves slick!

      1. Those tax cuts aren’t going to pay for themselves slick! ??
        +1…..

        Times that his party has discussed cutting Medicare and Social Security with Trump and said the president has expressed openness to the idea ??

        That should go over well in Florida…

      2. “his party has discu$$ed cutting Medicare and $ocial $ecurity with Trump”

        =

        Gifting the U.S. Senate to “thee.Squad&Co.!”

        Oh, Nancy Pelosi …

    2. He knows that is the third rail and he has avoided it. Just Globalist Republicans trying to push him into cuts. He might be willing to raise the retirement age like Reagan did to assure the viability of the system but those would be phased in and would not impact either current beneficiaries or people can lose to retirement.

      1. This wouldn’t surprise me. Paul Ryan had been trying for a while to get the GOP to back entitlement reform (e.g. cuts to social security and medicaid).

        Raising the retirement age is a must. Also, they will have to lift the social security cap on income contribution and perhaps means test the benefits. With deficits the way they are, something is going to have to change, no matter which party is in power.

      2. He could always hike Social Security taxes to keep the system afloat, like Reagan did, as Republican presidents have carte blanche to hike taxes.

        1. “He could always hike Social Security taxes to keep the system afloat, like Reagan did, as Republican presidents have carte blanche to hike taxes.”

          It was a compromise like the parties used to do, the Democrats wanted higher taxes the Republicans the cuts. Just like the amnesty in 1986 was suppose to lead much tougher enforcement of immigration laws. Unfortunately, only one half of that compromise was honored. Thank the billionaires like Koch and Soros for that, globalism at work even then.

  15. For entertainment I like to pull up random houses for sale in areas outside of the big city where prices really went bananas and where good-paying jobs are almost non-existent, save for your local doctors, attorneys, etc. I then open up a mortgage calculating app and figure out, based upon local rents (which are of course hyperinflated at this time), what percentage down payment would be required in order for the house to achieve positive cash-flow. I take into consideration things like property taxes and insurance, but I don’t factor in maintenance and repair.

    It’s nothing short of shocking. At this point in time, a 30% down payment will oftentimes not be enough to allow the rent to cover the mortgage, and again that is not factoring in maintenance and repair, vacancy, etc. In many instances, you would have to put 40%+ down just for the rent to cover the mortgage payment. That’s how horrifically distorted the market has become, and that’s in a time of record rents!

  16. As mentioned on this blog, price history is often hidden from buyers.

    There was one site, however, that I could quite consistently find price history for my area. That site was “realestate.com”. I last used it yesterday.

    As of today, that domain is permanently redirected to Zillow. I wonder why.

    1. The only “price history” I would care about as a buyer cannot be hidden in most states, and that’s the past sales price history.

      1. And Utahns still demand I understand they are a “pro market, free enterprise, capitalist state”.

        Hypocrites.

  17. States.Rights! States.Rights! … (just what large western ranches & end.of.summer drought.dry lands need: bored kids with Amazon free delivery drones & china.made blow torches)

    The FAQ threatens $25,000 fine for weaponizing drones

    Devan Coldewey | TechCrunch | 8/23/2019

    ” … the biggest buzzkills in the world… the Feds.

    Yes, the FAA has gone and published a notice that drones and weapons are “A Dangerous Mix.” Well, that’s arguable. But they’re the authority here, so we have to hear them out.

    “Perhaps you’ve seen online photos and videos of drones with attached guns, bombs, fireworks, flamethrowers, and other dangerous items. Do not consider attaching any items such as these to a drone because operating a drone with such an item may result in significant harm to a person and to your bank account.”

    They’re not joking around with the fines, either. You could be hit with one as big as $25,000 for violating the FAA rules. Especially if you put your attack drone on YouTube.

  18. He knows that is the third rail and he has avoided it. Just Globalist Republicans trying to push him into cuts. He might be willing to raise the retirement age like Reagan did to assure the viability of the system but those would be phased in and would not impact either current beneficiaries or people can lose to retirement.

  19. Celebrity burglaries targeting Usher and Adam Lambert tied to Beverly Hills Realtor

    A real estate agent and a Beverly Hills man have been charged in a massive money-laundering and burglary scheme that targeted open houses in wealthy enclaves, with some of the homes belonging to celebrities, authorities said…

    If you spot a realtor in your neighborhood, lock your doors and call the police.

  20. Had an interesting though today:

    We’ve spent some energy here talking about how prices have gotten away from buyers and the inevitable crash that happens when no one can (or wants to) afford what you are selling.

    We’ve also talked a lot about those with access to cheap helicopter drops of money have been stashing it in any hard asset they can find, including housing, in an attempt to store value.

    As much as this current stage of the cycle is being brought about by a dearth of buyers and fatigue on their part, It’s less clear to me at least, how much of this state is also being fueled by those that were storing money seeing the writing on the wall and deciding to get their money out as fast as possible even though they don’t technically ‘need to’ – but rather in anticipation of 2008-2010 all over again and trying to roughly time the market in getting out?

    Thoughts?

    Also, on the more personal side of LifeOfSpiffy(tm), I had a very interesting (couple of) job opportunities manifest themselves today, and I would be curious to get other takes on them from some of you that have indulged me enough (too much!) already – especially from those here in tech and my age and older (yes, ageism in tech is part of the equation that I am mulling over).

    1. I would be curious to get other takes on them from some of you

      Do share. Being in tech, and also having connections to your particular area of the industry (through the missus), happy to opine!

      1. Do share. Being in tech, and also having connections to your particular area of the industry (through the missus), happy to opine!

        Hopefully she’s not at RTC – one of the execs there very publicly said in front of others that he wants to see my throat slit and watch me bleed out (long story, but they get real pissy when they don’t make partner).

        In any event, here’s my dilemma – I’ve got a few different job offers & opportunities in front of me right now. After Pax, I’m taking a 2-3 month contract that’s remote/WFH so I can continue rehab and get well enough to survive commuting and spending 8+ hours in an office every day. It’s ninja work on an iconic character title (think Mario if it was Nintendo) that I can do in my sleep. But after that, when I am ready to return to the grind… What to do?

        There are 3 jobs in front of me right now that are making a strong play, two of them I’d put at 95%+ sure I’ll get if I choose due to -factors-.

        In order of what I want, the third would be firmware work at a local hardware startup (~30-50 people). Pay would be just basic – 150-165 probably, no stock, etc. How long will the company survive is a big question, hard to see it 3 to 5 years out – it’ll either grow big or flame out.

        The 2 more interesting ones offer very different paths for the future, and pull me in different directions.

        You know I’m in my early 50s and was reset by an awful divorce. So I have a couple different factors pulling at me. One is Make as much $$$ as I can to make up for all I lost. The other is not keep changing gigs so often. Technically, I’ve had 6 already this decade (laid off/out of business/shown the door/chose the door/ and job just completed). It’s draining to context switch and job hunt so often. I’d like to have something last a while longer.

        Another thing about being this damn old is that I’m tired of having to spend the majority of my time playing office politics to stay employed. A lot of the tech companies seem to have adopted the ‘rise to the top or die’ mentality have and no problem throwing away people along with all their tribal and domain knowledge if they don’t show enough ambition or don’t play the office politics well enough. And let’s not get started on Stack Ranking and how that pits you against all your peers.

        And finally, ageism in tech comes in. My hair is more grey than not now, and I’m starting to get the feedback about needing to look younger, and encountering more and more failure to match the ‘culture fit’ at places full of youngsters. Google Kirkland being a recent one. I went the full interview loop there and it was like being on a college campus. I stuck out like a sore thumb and decision was close but no dice, with I suspect fit a big factor.

        So if it’s that bad now, what happens when I hit 55? 60? I run the risk of being unemployable or excessively long periods between gigs. So there’s a big attraction to find some place that doesn’t have those environments or culture.

        1. You’re already a dinosaur in your early 50s. I was reading about ageism in the workplace, and they were talking that over 35 was getting up there.

          1. Agreed. I seem to have not hit the difficult parts… yet, but I know others in my age group who have. And many of them still have kids at home, SAHMs, etc, or just aren’t prepared and are starting to really sweat about how they are going to keep the high income up for another decade.

        2. I can relate to much of what you’re considering. Granted I’m ~10yrs younger and don’t have the drag of a divorce on me, but I’ve also changed jobs quite a bit, I’m on #4 in the past 5 years I believe. Agree that interviewing, ramping up, establishing yourself, etc, takes a lot out of you.

          Personally I most recently went for the “get the $$$ while you can” this time around, and am working for uncle Jeff these days. Figured there’s not much to lose, at least not in the first year, due to the comp structure. Prior to this, I’d sought more personal growth/fulfillment, taking significant pay cuts at times when I felt I was getting something else in trade. In the end, it’s all just a “job”, and at least my experience is the tech jobs that don’t have pressure to rise/succeed end up attracting/keeping folks of lesser skill/ambition/ownership, which can be frustrating if you’re still driven.

          FWIW, there are companies out there that value people who have “been there, done that”. Whether they’re willing to pay what you feel you’re worth may be another story though!

          I agree with Bubbleville that commute is a big factor to consider, especially around here. An hour a day in bad traffic will make you hate life no matter how good your job is! Though, you’re in a good spot for that, as both downtown and east side are decent options.

          Getting in somewhere while you’re still “young” and building a reputation/career does seem like a reasonable approach in your situation.

          Tableau/Salesforce might be one to look at in terms of valuing more experienced folks and having a reasonable culture, if you’ve not considered them.

          1. Thanks for the thoughts.

            I’m really leaning towards the slower, stable option. The commute is about 30 minutes (Renton), which is similar to the other options. I’d be coming in with over 2 decades experience on the specific, very uncommon, product their systems are built in. That fact alone has them very interested in me.

            I’d keep my side projects to keep up on the cutting edge stuff.

        3. “Pay would be just basic – 150-165 probably, no stock, etc. How long will the company survive is a big question, hard to see it 3 to 5 years out – it’ll either grow big or flame out.”

          That’s the thing – how long will the new job last? If you’re young, it’s no biggie, you’ll probably leave before it all comes crashing down anyway. But if you’re older, especially well over 50, it’s another story. You can have the right skills, but if you’re competing against younger but equally qualified candidates, then it gets hard as nails. You will need to be far better than anyone else to get the job.

          1. You can have the right skills, but if you’re competing against younger but equally qualified candidates, then it gets hard as nails. You will need to be far better than anyone else to get the job.

            I’m in total agreement with you Colorado. When I was starting out in the game industry, I did some horrific crunch (and granted, it did pay off eventually). I couldn’t physically do that today. That crunch back then was necessary for the studio’s survival. Most of the time it’s not, but the bosses will still inflict it, as they feel they are in an arms race with all the competition.

          2. But if you’re older, especially well over 50, it’s another story. You can have the right skills, but if you’re competing against younger but equally qualified candidates, then it gets hard as nails.

            Hey, IC, long time no talk. I was just back there for my son’s graduation from Boulder High a few months ago. Wondered if you got caught up in any of the recent layoffs? One of my friends who was a really valuable guy got blown out a few months ago…he’d been at STK/SUN/ORACLE for over 20 years. I was really surprised.

        4. Can’t help you on the choice, the way my brain works I have to choose the more relaxed environment. I can do good work when I feel relaxed and in control but lose my mind when I don’t.

          But regarding ageism I’ve been extremely fortunate to work in storage and for Japanese companies. Both things seem to contribute to age being ok. If I were to lose my toehold in this part of the industry I might be in big trouble but as long as I’m doing what I’m doing it feels relatively secure compared to most tech. There are lots of people older than me and you actually get to see normal worker bees retire voluntarily.

          1. The sub segment that I’ve been in – video games – has radically transformed over the last decade. It’s now a young man’s race and they are being chewed up by the thousands in the AAA sector to line the pockets at the top and of shareholders, or a race to the bottom in the indie sector in hopes of a viral winning lottery ticket. It’s not a place where age helps, or is seen as advantage. Granted there are a few ‘elder statesmen’ but they had already made their fortune a long time ago, or have power in the form IP ownership, etc. I had actually decided to leave years ago – that’s why I was at the house of (mickey) mouse. Why I got back in and how I got my pending windfall is basically stolen from the plot of Eastwood’s Space Cowboys.

            It’s just a question of where to go next. If I go to a FAANG type company where the comp package dangles the big carrot, it’s going to be hit or miss as to if the culture values my deep experience – but I suspect more misses than hits, and you have the relentless pace and politics common to those type of companies.

            There are lots of people older than me and you actually get to see normal worker bees retire voluntarily

            You don’t see that at Amazon/Microsoft/Google/etc. Microsoft is the oldest – over 40 years, but according to lots of local ‘softies, ex- and current, the cull rate above age 45 is horrendous (if you haven’t made partner), but somehow not statistically abhorrent enough to qualify as age discrimination to an outside investigation.

            I’m going to give it a go for the unsexy slow and steady place,- if they’ll have me and meet my salary of course. I should hear back from them next week. (I have a trump card for this particular job opening that got their attention big time) If that doesn’t work out, I’ll probably go for the firmware job, and pass on amazon.

      2. Ok, that was so long I forgot to add the final bit. You can probably have already surmised what my choices are based on the backstory.

        The choice boils down to – stay in the heart of the game working my tail off to try for max dollar and delay escaping to something more secure, or take a gig now that would offer long term security and an (honestly) relaxed existence. But that would mean getting out of the fast lane and potentially riding it out in obscurity until retiring.

        (a bunch of specifics removed)

        tl;dr One is manager at Bezos land for 210-260, the other is an old conservative industry for 185-200 and no overtime and very high chance of staying 10+ years.

        Fork in the road time.

        1. It’s nice to have some options and they all sound lucrative being north of 150k. Personally if I was in your situation I would make a simple pros and cons board and list them out. I would lean towards the one that provided the best quality of life and met my financial obligations. Seems like your work allows you to tell commute which, to me, provides that quality of life and reduces a great deal of stress.

          1. It’s nice to have some options and they all sound lucrative being north of 150k

            That’s part of what brought me to Seattle in the first place. It’s #2 in terms of industry salary, behind only the bay area. That helps when you have the same fixed costs you’d have anywhere (car payment, alimony, etc). We’d be comfortable on that as Mrs Spiffy is doing similarly well.

            As I mentioned above, I am leaning heavily towards the quality of life option. I’ve got the payouts to expect from my last 4 years of work to juice the savings and investment. I’d be commuting into an office (about 30 min), but it sounds like work from home half the time is option that a lot of people there take.

            I think one of the feedbacks I was most looking for was if I my fears of ageism were overblown or not, because that’s something totally outside of my control.

          2. 50 is the new 30 :). You seem to be in a high demand line of work and I am sure most companies will value your skill set over your age. I mainly talk with CEOs and directors in my line of work and they are all nearing retirement age. I think having the confidence and know how means a lot more than the A.D.D and loudly spoken self promoting that many of the younger know it alls show. Having experience often beats out those with lengthy college educations in my line of work but the college experience is surely a plus.

        2. other is an old conservative industry for 185-200 and no overtime and very high chance of staying 10+ years

          Quality of life and stability. Life’s short. Enjoy it rather than running a rat race for a day you may never see.

    2. BTW, don’t know where you are in your rehab, but I’ll throw out a suggestion for a company I’m (disclaimer) invested in that might be of interest: VirZOOM.

      Bike-based locomotion in immersive VR worlds. Even have one of their initial exercise bikes that’s just taking up space if you don’t have one and wanted it!

      1. I have an elliptical and weight bench, but was thinking of (have been heavily advised from all sides) getting a bike and not using the elliptical for the next 2-3 months. I do a fair amount of bike at PT.

        Looks like it only supports Oculus and not Vive (Index) ?

        1. Looks like it only supports Oculus and not Vive (Index) ?

          Looks like it. At first they supported everything — Oculus, Vive, PSVR, WinMR, but seems they’ve “pivoted” to focus just on the latest generation of Oculus devices due to cost and capability.

    3. “…those that were storing money…”

      I see things as a demographic perfect storm, e.g., living longer, but not working longer; more workers educated, so smaller families; specialization pigeon-holing, so increased dependency; globalization, so meager gain in wages; less manufacturing, so less real wealth creation; etc., but our economic model is based on a population pyramid with few elderly and ample childbirth. Simply put, today there’s too many older people with retirement promises that they’ll likely never see upheld.

      1. A couple interesting points there I usually don’t think about beyond just the demographics.

        The changing nature of ‘work’ and pigeon-holing as you put it aren’t usually pointed out, but I do see how they will impact retirement promises world-wide as well as sideline large groups from feeling like they have upward mobility, or even the ability to just not fall behind.

      2. Simply put, today there’s too many older people with retirement promises that they’ll likely never see upheld.

        I think you hit the nail on the head. And many with insufficient savings will try to use their home equity to pay for medical and living expenses at about the same time (I think 9 years will be the tipping point).

      3. I know a few highly experienced guys my age who still have huge mortgage payments for years to come, but they are just one “short-skirted” manager away from the street because they don’t compliment her beauty a half-dozen times a day.

        1. because they don’t compliment her beauty a half-dozen times a day.

          or.. they do compliment her innocently, but not in the right way and they are reported to HR. I’ve personally a seen a couple young ladies on the corporate ladder with modern indoctrination and zero qualms about seeking ‘justice’, especially when it “intersects” with their ambitions. (think “donglegate”)

          It’s a minefield out there.

    4. That’s the downside of tech.

      I don’t think there’s the same type of ageism in industrial automation, but the median salaries are lower (and you don’t have the same type of “super star” salaries AFAIK).

  21. Did the Fed’s rental rate reflation program leave your neighbors homeless when the investor-owner-landlord sold to grab the crazy-high post-2012 capital gains?

    It happened to the single mom and her family that lived next door to us. And the next owners, who were Chinese nationals who greatly overpaid, ended up divorced and departed within a couple of years after buying. We’ll see how the new owners fare, especially if prices go into a tailspin within the next couple of years.

  22. The New American Homeless
    Housing insecurity in the nation’s richest cities is far worse than government statistics claim. Just ask the Goodmans.
    By Brian Goldstone
    August 21, 2019
    Photographs by Sheila Pree Bright for The New Republic

    Last August, Cokethia Goodman returned home from work to discover a typed letter from her landlord in the mailbox. She felt a familiar panic as she began to read it. For nearly a year, Goodman and her six children—two of them adopted after being abandoned at birth—had been living in a derelict but functional three-bedroom house in the historically black Peoplestown neighborhood of Atlanta. Goodman, who is 50, has a reserved, vigilant demeanor, her years trying to keep the kids out of harm’s way evident in her perpetually narrowed eyes. She saw the rental property as an answer to prayer. It was in a relatively safe area and within walking distance of the Barack and Michelle Obama Academy, the public elementary school her youngest son and daughter attended. It was also—at $950 a month, not including utilities—just barely affordable on the $9 hourly wage she earned as a full-time home health aide. Goodman had fled an abusive marriage in 2015, and she was anxious to give her family a more stable home environment. She thought they’d finally found one.


    As a longtime renter, Goodman was acquainted with the capriciousness of Atlanta’s housing market. She knew how easily the house could slip away. Seeking to avoid this outcome, she ensured that her rent checks were never late and, despite her exhausting work schedule, became a stickler for cleanliness. So strong was her fear of being deemed a “difficult” tenant that she avoided requesting basic repairs. But now, reading the landlord’s terse notice, she realized that these efforts had been insufficient. When her lease expired at the end of the month, it would not be renewed. No explanation was legally required, and none was provided. “You think you did everything you’re supposed to do,” she told me, “and then this happens.”


    A clue lay in the neighborhood’s accelerating transformation. Up and down her street, old, shabby dwellings—many of them, like the one she rented, casualties of the previous decade’s foreclosure crisis, purchased at rock-bottom prices by investors who had simply waited around until they appreciated in value—were being sold, gutted, and reconstructed. In retrospect, a flyer on her doorstep from Sotheby’s International Realty, offering to “pay cash, close quickly, and save you the hassle of multiple showings and cleaning/renovating/staging/pictures,” was an ominous sign. Goodman’s landlord, a doctor who runs an international nonprofit, told me recently that she didn’t renew the lease for financial reasons. “With the area taking off,” she explained, “it was the perfect time to unload the property.” When we spoke, she was preparing to sell the house.


    Goodman had 30 days to relocate her family. She began scouring Trulia and Apartments.com for available rentals within her budget. Every night, she waited until the kids were asleep before retreating to the couch with her battered smartphone and a notepad. The list of possibilities remained depressingly short. She hoped to stay nearby in order to spare her children the hardship of switching schools, but she soon understood that continuing to live in this former working-class enclave—to say nothing of adjacent, more thoroughly gentrified communities like Grant Park—was out of the question. “It was like we’d been kicked out of the entire area, not just that particular house,” she said.

    ..

    1. Not said, she is earning $9 for a hard job because of the flood of low skilled illegal immigrants who have greatly increased their standard of living by moving here. Also, not said the housing costs have increased by asset inflation encourage by the Fed. The Democrats who should be fighting globalism are complicit in it.

    2. Seeing how the Spiffys lived through a version of this twice in the last decade despite living in a tony zipcode, I’ve had my eyes opened to just how many people in all sorts of places and income levels have to live stress over housing security. A new class divider in many ways.

    1. The Financial Times
      US-China trade dispute
      Donald Trump raises tariffs on Chinese goods after stocks tumble
      President orders US companies to look for ‘alternative’ to China and faults Fed
      Donald Trump, left, has responded furiously to the latest tariff announcement by his Chinese counterpart, Xi Jinping
      © AP
      James Politi in Washington, Colby Smith in New York and Brendan Greeley in Jackson Hole yesterday

      Donald Trump announced on Friday night that he was increasing tariffs on amost all Chinese imports, ramping up the trade war with Beijing after triggering a sharp market sell-off earlier in the day by warning US companies to leave China.

      In a series of tweets after the stock market closed, Mr Trump said he was raising existing tariffs on $250bn worth of Chinese imports from 25 per cent to 30 per cent on October 1, and raising tariffs on $300bn of Chinese goods, due to start on September 1, from 10 per cent to 15 per cent.

      Mr Trump’s move capped a tumultuous day on world financial markets that began with Beijing announcing it was preparing to slap new levies on $75bn of US imports, and saw Jay Powell, the Federal Reserve chairman, caution that the central bank would be unable to counteract the effects of a US-China trade war.

    1. First they’ll come for your money, and then your guns.

      US Dollar
      Mark Carney calls for global monetary system to replace the dollar
      New approach would alleviate influence of capital outflows, BoE governor says
      Mark Carney in Jackson Hole: the IMF could ‘chang[e] the game’ by building a multipolar system, said the Bank of England governor
      © Bloomberg
      Chris Giles in London yesterday

      Mark Carney, the Bank of England governor, has said that the world’s reliance on the US dollar “won’t hold” and needs to be replaced by a new international monetary and financial system based on many more global currencies.

      In a speech at the annual Jackson Hole gathering of central bankers in the US, he called for the IMF to take charge of a new system of currencies, insuring emerging economies from destructive capital outflows in dollars and removing their need to hoard US currency. In the longer term the IMF could “chang[e] the game” by building a multipolar system, he said.

      Having served as the leading central banker of Canada and the UK over the past decade, Mr Carney has significant influence and is well-regarded by other policymakers. His speech, delivered to other central bankers, will be seen as an attempt to burnish his credentials as a possible future IMF managing director, appealing to emerging economies in particular.

    2. Et tu, Anthony?

      The Financial Times
      Opinion Donald Trump
      I dumped Donald Trump to save the liberal world order
      Ex-White House communications director is fighting against president’s re-election
      Anthony Scaramucci: ‘If he [Trump] faces more honest condemnation, the edifice of sand beneath him will crumble’
      © EPA
      Anthony Scaramucci
      August 22, 2019

      My uncle Anthony Defeo survived the D-Day invasion mostly by luck. His Higgins boat landed on a Normandy beach near a decoy minefield and members of his battalion who made it to the shore were able to climb up the beach into German-occupied territory.

      Despite having an Italian immigrant mother — my Nana — who was frequently told by nativist Americans to “go back to where you came from”, Uncle Anthony became a decorated war hero. His contributions helped bring an end to the war and the beginning of western Europe’s alliance with North America in building a framework for long-term global peace.

      The lessons embedded in this family history are among the reasons why I recently withdrew my support from US president Donald Trump, whom I briefly served as White House director of communications.

      Mr Trump has long derided Nato as “obsolete”. This petulant narcissist also believes that he alone can fix the treaty. Now, depending on his mood swings, it almost seems as if he’s trying to destroy transatlantic understanding. Mr Trump’s bizarre attack on Denmark’s prime minister this week is another inexplicable example of this mission to alienate allies. His remaining supporters in the US government are left trying to paper over and normalise something that is quite far from normal. While the attachment to power can make us all do regrettable things, we cannot allow this man to cause a crisis that could upend the liberal world order — an order that my uncle fought to establish, which has driven global peace and prosperity since the second world war.

      1. Excellent Anthony, and who will do our bidding and treaty’s in the future, oh yes Cherokee nation Warren???

  23. Might the latest tariff escalation and Fed critique be intended to force Mr. Powell’s hand to lower rates by more than planned later this year?

      1. Ruse? You are calling this well thought out, well measured potential economic action by some of the planet’s most esteemed and learned economists one year before an important election a … a ruse?

        Shocking!

  24. The “one of you” socialist Obama’s will bid under 14m, why don’t they hire Sanders @2% and he can bid $140k???

  25. Don’t you folks just love Trump loyalist, they remind me of Real Estate agents, after 3 months and no sale why they listed your fine house goes out the window, now you need to drastically lower your price, not the commission of course?

Comments are closed.

Back To Top