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The Buyers Want 50 Cents On The Dollar, And Sellers Are Still Remembering Prices From Nine Weeks Ago

A report from the Wall Street Journal. “In April and May, 354 apartment and office properties started missing payments on $7.1 billion in mortgages, according to Trepp LLC, which only includes loans packaged into mortgage bonds. That is up from around $4.2 billion in February and March. That increase is ‘just the start,’ said Michael Fay, head of the asset-resolution team at brokerage firm Avison Young. He said he expects more tenants to miss rent payments in June and July, leading to a rise in mortgage defaults throughout the year and into 2021. Smaller landlords, who often have fewer capital reserves, are in particular danger, he said.”

“For now, there are few sales of distressed assets, in part because the pace of the market downturn has left many in the industry stunned. ‘The buyers want to buy at 50 cents on the dollar, and the sellers are still remembering the prices from nine weeks ago,’ said Mark Edelstein, chair of law firm Morrison & Foerster’s global real-estate group. The lack of deals has made it hard to determine how far property prices have already fallen.”

“Some rental-apartment owners were already struggling before the pandemic in cities like New York, where lawmakers tightened rent restrictions. The current crisis is acting as an ‘accelerant,’ Mr. Edelstein said. ‘It’s going to take years to dig out of what’s happening now.'”

From Senior Housing News. “The pandemic put a halt to the longest sustained period of economic growth in the country’s history and has global economies facing the largest economic downturn since the Great Depression. With that comes the possibility for a larger number of distressed commercial real estate assets, as the last downturn showed. Real Capital Analytics tracked over $462 billion during the Great Recession — equivalent to 12.5% of outstanding commercial mortgages at the time — and determined that valuations plummeted 35%, erasing the equity in many deals. Lenders also saw significant losses and were able to recoup only 67% of defaulted mortgage value.”

“‘The hotel, retail and senior housing sectors will clearly have more trouble resulting from Covid-19,’ Real Capital Analytics President Bob White wrote.”

From Bisnow. “Trust Hospitality CEO Richard Millard said the coronavirus has eliminated his company’s revenue. Trust operates 31 boutique hotels, and as an operator, he said 2021 might be the next time his company takes in revenue. ‘I don’t see most of us that operate hotels, certainly as a pure operator, are receiving any income for the remainder of the year of any kind,’ he said. ‘I hate to be the bearer of bad news, but I think that’s what it is.'”

“His team closed all but two of its hotels — one near a hospital in New York and one near the airport in Miami. It laid off essentially all of its hotel and corporate staff, he said. It had five other hotels on the verge of opening, including one next to Orlando’s convention center, he said. ‘I think we got maybe another 30 days of survival,’ Millard said. ‘Then I’m not sure what happens.'”

“Driftwood CEO Carlos Rodriguez Sr. said his company’s operations side had to lay off more than 3,000 workers in response to the coronavirus pandemic. But for its investment arm, he said he expects ‘there will be an avalanche of transactions’ in the hospitality space six to 12 months from now. Rodriguez said based on what he’s seeing in the market, buyers right now are expecting a 30% to 40% discount on assets, but sellers only want to give about 20% off.”

“Millard was less willing to make predictions because of so many unknowns related to the cornavirus. Although a lot of capital is sitting on the sidelines, many would-be buyers already own a lot of real estate, which could run into trouble if the virus persists, Millard said. ‘So I’m not sure what really happens is going to be an avalanche, but it all depends on what happens to the world,’ he said.”

From CBS DFW in Texas. “While the statewide moratorium on evictions started in March, landlords were still able to submit filings for eviction cases. More than 1,100 new eviction petitions have been filed in North Texas since Mar. 16, according to public information requests filed with justice of the peace courts in Denton, Tarrant, Collin and Dallas County. But many cities have not created extra protections for renters. Landlords argue they, too, are struggling to pay the bills during the pandemic.”

“‘I think it will probably be a day of reckoning for landlords and tenants,’ said Christopher Fluegge, director of operations for the National Landlord Association. Fluegge is also a landlord who is based south of the Metroplex. More than 20% of tenants have fallen behind on rental payments since COVID-19 first hit, according to Fluegge. ‘Landlords are typically put out there as a bad guy in scenarios like this when, in fact, most are running small businesses trying to make ends meet,’ Fluegge said. ‘They’re not getting a lot of adjustments from financial institutions…. the banks are calling them for payments.'”

From Curbed New York. “As rental activity has, unsurprisingly, slowed in the midst of the novel coronavirus pandemic, market uncertainty is beginning to chip away at rents across the city. And that, along with rental concessions—perks paid for by the landlord—could translate to deals for renters looking to move in the coming months. On listing website Localize.city, for instance, rents have fallen for 70 percent of apartments listed prior to the statewide stay-at-home order, which went into effect on March 20.”

“Those prices have reduced on apartments in all five boroughs with an overall drop in rents between three to five percent. Those may not be mind-blowing reductions, but they’re a signal that rents are trending downward, and likely to continue doing so in the midst of the city’s public health crisis, says Steven Kalifowitz, president of Localize.city.”

“‘Based on what we’re seeing, and anecdotally what I’m hearing, we should expect more rental price cuts in the future,’ says Kalifowitz. ‘I expect we will see people either moving to get a better deal on a bigger / better place, or others downsizing to accommodate lower salary expectations.'”

“Noah Rosenblatt, CEO of UrbanDigs, a Manhattan real estate data firm, notes that ‘there’s a lot more concessions to be had versus pre-COVID. If you can get two months free at $3,500 a month, your net effective rent goes way down,’ says Rosenblatt. ‘It’s just another way of getting that rental rate reduced in an environment where landlords typically are not so quick to start rushing to reduce those rents.'”

The San Francisco Chronicle in California. “Sales of existing, single-family homes in April — the first month to show the full force of the coronavirus — dropped a stunning 30.1% statewide and 37.4% in the Bay Area compared to the same period last year, but median prices were more or less unchanged, according to a survey released Monday by the California Association of Realtors.”

“‘It’s not a fire sale,’ said Leslie Appleton-Young, the association’s chief economist. ‘Typically, prices are sticky on any movement down when sellers don’t have to sell. When you get into a foreclosure situation, you have a bigger problem.'”

“‘I would call (the decline in sales) dramatic, sudden, breathtaking,’ Appleton-Young said. ‘What it shows is an inability to transact for buyers and sellers and unwillingness to move forward with transactions.'”

“The average rate on government-backed loans is down about a third of a percentage point in the past two months to 3.28%. These loans go up to $765,700 in most Bay Area counties. They’re easier to get than bigger loans, called jumbos, which lack government backing and are harder to sell to investors. With so much uncertainty, lenders are less willing and in some cases less able to hold jumbos on their books.”

“To get a jumbo loan, you need at least 20% down and a credit score over 700, said Jay Voorhees, owner JVM Lending in Walnut Creek. Before the coronavirus, ‘we could do 10% down and a 680 FICO’ credit score. Jumbo rates on average are about 1.5% higher than they were a few weeks ago, he added.”

From Q 98.5 in Illinois. “If you’ve ever wanted to live in a mansion but don’t have a million dollars this could be your chance. Sure, you’re still going to need to get a loan for about $600,000 but it is a mansion. Unfortunately, as indicated in the headline, this mansion has experienced a hefty price drop. In fact, according to ChicagoMag, more than a $2mil price drop.”

“‘It was foreclosed on last year, and last week, a real estate investment trust listed it for $589,000. That’s $2.2 million off its asking price of $2.79 million five years ago — an 80 percent discount.'”

This Post Has 93 Comments
  1. ‘I think we got maybe another 30 days of survival…Then I’m not sure what happens’

    Better get some boxes Dick.

    1. ‘So I’m not sure what really happens is going to be an avalanche, but it all depends on what happens to the world,’ he said.

      Leggy Vanessa looks confident, easily has a few more seasons ahead of her. Richard, on the other hand, looks like this is his last season…and it’s ending early.
      https://imgur.com/a/hk1bxaO

  2. ‘It’s not a fire sale…Typically, prices are sticky on any movement down when sellers don’t have to sell. When you get into a foreclosure situation, you have a bigger problem’

    I could see lots of pre-foreclosure auctions all over California before the CCP virus.

  3. ‘in fact, most are running small businesses trying to make ends meet…They’re not getting a lot of adjustments from financial institutions…. the banks are calling them for payments’

    How are those 5% cap rates working out?

    1. I’m pretty sure commercial real estate will get crushed worse than residential. There will be lots of residential areas that will hold up fine, but commercial will die a universal death

        1. “Everybody forgot risk matters.”

          I thought the Fed had every and all risks contained?

          1. ‘Twenty-one-year-old Sarah Tilton just graduated from Capital University in Ohio and is entering a job market she wasn’t ready for. While at college she worked as an office assistant, but now she’s unemployed and struggling to find a job. Without income, she was forced to move back home, facing mounting payments and costs to repair her car. She’s still looking for a job, but the responses have significantly diminished since the pandemic unfolded.’

            “In January, I’d get around four or five interviews back, now I don’t even get one,” she said. “A part of me is happy that I’m done with college, then there’s another part of me that wishes I would have stayed another year because I probably would be better off.”

            ‘Tilton isn’t the only one. In this tough job market, 2 in 3 three recent graduates worry they won’t be able to find a job in their related study, a survey of 1,000 College Finance shared exclusively with Yahoo Money found. Tilton is looking for business management and administrative office positions, but she’s competing against some of the 36 million Americans who have filed unemployment insurance claims in the last two months.’

            “It’s been hard to put yourself out there and show what your abilities are when you have applicants who lost a job and have maybe 10 years more experience than you do,” Tilton said.’

            ‘Along with the millions of job losses across the U.S., openings for new positions also have shrunk. Job postings on Indeed were down 39% through May 8 compared with the same period in 2019.’

            “I’ve had three or four [companies] so far finally turn me down at the last minute because of higher-qualified candidates,” Tilton said. “It’s kind of a competitive aspect that’s usually always around, but it’s around a lot more during the time that we’re in.”

            https://money.yahoo.com/recent-college-graduates-struggle-to-find-jobs-191244026.html

          2. “I thought the Fed had every and all risks contained?”

            1)
            “At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.” – Fed chairman, Ben Bernanke, Congressional testimony, March, 2007

            2)
            “The last duty of a central banker is to tell the public the truth.” – Alan Blinder, former Vice Chairman of the Federal Reserve, 1994 on the PBS Nightly Business Report

            3)
            “The first duty of a man is to think for himself” – José Martí

            – The amount of BS from the Fed is (only slightly) exceeded by the size of their balance sheet.

          3. Yellen the Felon assured us there would be no new financial crisis “in our time.” Someone better check and see if the old girl is still with us.

        2. “Like when Houston got two 500 year floods in two years.”

          – Or three 100 year financial crash events in 20 years…

          – Risk is fundamental to a capitalist system. So is failure, including bankruptcies. The Fed tries to wave it’s magic wand and make it “go away”, but in the process it only compounds it. What a bunch of morons, but they’re “playing” with our money. It’s almost like the outcomes are intentional, or something…

          – The Fed is causing the entire economic system to become fragile and prone to “100 year crashes”, now about every 10 years. The current one is the biggest and baddest, so far.

          – The Fed’s “dual mandate”:
          “The monetary policy goals of the Federal Reserve are to foster economic conditions that achieve both stable prices and maximum sustainable employment.”

          – So, how’s that workin’ out for ya? Asset bubbles and high unemployment. From bubble to bubble. And yet, here we are.

          1. “The monetary policy goals of the Federal Reserve are to foster economic conditions that achieve both stable prices and maximum sustainable employment.”

            It’s a nice cover story, for which there has never for a moment been any evidence. The continual inflation of our currency produces only instability, misery and wealth transfer.

          2. People who call the Fed incompetent fail to understand the Fed’s one and only mandate: to concentrate all wealth and power in the hands of a corrupt and venal .1% in the financial sector. At that, they’ve been a brilliant success.

  4. Housing prices were cratering long before CoronaScam.

    Santa Clara, CA Housing Prices Crater 10% YOY As Bay Area Housing Market Sinks Like A Turd

    https://www.zillow.com/santa-clara-ca-95051/home-values/

    *Select price from dropdown menu on first chart

    As one noted economist stated, “Housing prices are plunging and there is nothing you can do about it…..

    1. The workers already knew they could do it from home. It’s the managers who are getting used to the idea that comfort might trump seeing people respond when you say things. It’s the poor sad sacks who need to carry a coffee cup around having coerced-by-politeness conversations with other people in order to think that are having problems now.

    2. I demanded to be WFH about a week before the shutdown, and I’m not going back. That office is like an adult daycare… food, fancy coffee, all in one huge, loud room with 100 people in it. No offices. No cubes. There are meeting rooms that the jabbering nitwits could go into to flap their mouth holes, but they never do. The constant din is a lot like a busy bar, with people raising their voices to be heard over it. Then there’s the constant sickness… about a month of sick vs a month of not. You could not design a better environment for virus transmission.

      They pay me quite a bit to think, and then spend a bunch of money to build an environment where that’s impossible. Looks like they may be catching on, but I suspect they’ll try and get us back in there, to justify the multi year lease they signed.

      I won’t go. My nest egg and complete lack of debt says I don’t have to.

      1. Open-plan workspaces were designed by idiots who fail to realize that great ideas occur in solitude and isolation, not via “collaboration.”

        1. idiots who fail to realize that great ideas occur in solitude and isolation, not via “collaboration.”

          You’re talking about a group who has no experience with great ideas.

        2. all in one huge, loud room with 100 people in it

          I keep wondering who thought this would be a great idea and why did so many firms jump on the band wagon.

          1. Cheap rent, and they had the idea that enforced collaboration would make the smart rub off on the stupid, which can be hired cheaply. Worked pretty much the opposite of that.

    3. A big question of whether there will be a mass exodus from Silly Valley is the question of IP security. Some of these tech firms are locked down pretty tight – the ones that have real products (not twitter, lol). Be pretty easy for a worker to poach stuff so tighter legal contracts covering remote work will probably have to be drafted.

      I’ve been coding from home for about 3-4 years now, its nice – lot less wear and tear on your car too. Taking breaks to get on the bike or swim also help me relax so when I get back to job mode my brain seems to work a little faster.

      1. Everywhere I’ve been, the code lives on github. We wander in and out with laptops full of IP. Did have a military gig where they were all crazy about that stuff, but had nothing of value to steal.

        1. I think I just found my long lost twin based on your rant a few posts up plus this one. Yeah, rest assured management will demand you be herded back into the building at some point to justify the lease. I’ve been at 2 companies now where management valued office space more than employees, reporting up square footage (that was empty) while laying off people. Clusters, high end electronics and big outdoor equipment that wasn’t even used but dutifully maintained to give the illusion of need and to stave off office closing that would force people to relocate or find new gigs.

          You forgot to note that most of that office food is complete garbage.

          And the thinking part – that hit me hard, not a lot of that anymore. Too many people wired on absurd amounts of caffeine coming up with ways to apply band aids and duct tape to rube Goldberg inspired designs.

          I’m in the same boat as you, nest egg and no debt. F’ em all.

          1. “And the thinking part – that hit me hard, not a lot of that anymore.”

            You Gen Xers and especially Zoomers don’t have to think because you’ve been schooled, “what to think,” not “how to think.” The scrawny gelded cucks who must pledge fealty to some phat feminist and her mulatto child; everything financed, nothing left over, vote D, that’s your future. Embrace it!

          2. the thinking part

            I never had the experience of working in a sardine can like that. Sure I had to attend too many meetings. If I wanted to clear my head or have a very private conversation I’d just walk out and take a stroll, or sometimes exercise my fly rod down at the pond. Sometimes just go into the manufacturing area and talk to the techs.

            I never felt or was treated like a drone. But, having savings and no debt, I eventually waved a cheerful goodbye. Freedom is wonderful, even if you’re not miserable.

  5. Over 4 million Americans are now skipping their mortgage payments
    Published: May 19, 2020 at 1:28 p.m. ET
    By Jacob Passy
    The pace of homeowners requesting mortgage relief because of the coronavirus pandemic has slowed considerably
    More than 4 million Americans have stopped making mortgage payments because of economic hardship caused by the coronavirus pandemic.
    Getty Images

    Fewer Americans are calling their mortgage servicers to ask for relief from mortgage payments, but the housing industry isn’t out of the woods yet.

    More than 4.1 million homeowners are in forbearance plans now, according to the latest data from the Mortgage Bankers Association.

    1. “…but the housing industry isn’t out of the woods yet….”

      So what happens when the existing forbearance agreements (typically 90 days in length) expire?

      Will these forbearance agreements then be renewed for another 90 days? And then another and another and another?

      Does *anybody* (except the REConplex) think that homeowners are magically going to come up with 90 days of back mortgage payments?

      HBB readers better stock up on popcorn, ’cause there’s going to be a shortage of that too….

      1. Will these forbearance agreements then be renewed for another 90 days? And then another and another and another?

        Maybe, but that can’t go on for long. Somebody here said it will need to morph into some kind of automatic refi scheme and that sounds like the most likely thing to me.

        1. “…it will need to morph into some kind of automatic refi scheme..”

          That would be brilliant.

          In others words, existing loan owner equity (assuming there is any left) will be sucked dry one refi at a time.

          If loan owner equity goes negative, then I am sure some sort of slavery for work program shall be implemented.

        2. automatic refi scheme

          Sorry but we cannot approve your refi application. Your credit score was crushed when you missed several previous mortgage payments, and the estimated current value of your home is less than 120% of the requested loan amount.

          1. Part of “automatic” would be waiving all that stuff. Because emergency. Keeping hard working Americans in their homes. You know they’re good for it.

          2. Because emergency. Keeping hard working Americans in their homes. You know they’re good for it.

            Anything to keep the prices levitating.

      2. “So what happens when the existing forbearance agreements (typically 90 days in length) expire?”

        My guesses:

        1) After the end of COVID-19 forebearance, refinancing will happen where possible to enable homeowners to resume repaying their debts.

        2) The remaining term of the loans will be adjusted to balance the ability to make monthly payments against the need to repay the remaining balance of the loan, including extra interest accumulated during COVID-19 forbearance.

        3) Homeowners will find their lifetime discretionary income decreasing due to having to spend more of their future lifetime repaying their mortgages, including the aforementioned extra interest accumulation.

        1. Prices are set at the margin, Maestro. We only need 1% to balk at a bad deal. Also, when you lose 50% of your household income, even a refi into a 50-year mortgage won’t save you, even with negative rates.

  6. The noble-minded are calm and steady.
    Loan owners are forever fussing and fretting.

    1. I’ve been discussing his college writing assignment with one of my sons, on a passage from Shakespeare’s Hamlet which includes the following timeless advice:

      “Neither a borrower nor a lender be,
      For loan oft loses both itself and friend,
      And borrowing dulls the edge of husbandry.”

  7. “‘It was foreclosed on last year, and last week, a real estate investment trust listed it for $589,000. That’s $2.2 million off its asking price of $2.79 million five years ago — an 80 percent discount.’”

    If 80% discounts come to my town, I could definitely afford to buy!

    1. “…If 80% discounts come to my town..”

      No rush, no worries.

      The fat lady has even showed up to the stadium yet.

  8. Trumpy yesterday: “Pelosi is a sick woman. She’s got a lot of problems — a lot of mental problems.” 🤣🤣😂

      1. That’s what happens when government gets involved…. It turns to $hit….. Even the water supply.

  9. A title from Crain’s New York Business:

    Doubts about city’s ‘long-term attractiveness’ will drag real estate recovery

    This is what I was mentioning recently. One can start to see who is going to get emptied out.

  10. New York Sent Recovering Coronavirus Patients to Nursing Homes: ‘It Was a Fatal Error’

    ‘The state reversed its policy after mounting criticism and deaths.

    ‘The directive was meant to protect those infected with coronavirus from discrimination, a state official said.’

    https://www.wsj.com/articles/new-york-sent-recovering-coronavirus-patients-to-nursing-homes-it-was-a-fatal-error-11589470773?mc_cid=29e311994d&mc_eid=a1a5fefdd3

    Jeebus, that’s a bunch of dead people because of some wacky SJW notion.

    1. a state official said

      Rather, I think it was Triage. Cuomo was bracing for the hospitals to be overwhelmed and the people from nursing homes were “going to die anyway”.

      1. Probably true, statistically. The people in those places are not just old, they’re feeble too. If they get covid, they are probably going to die no matter what. All you can really do is try to keep them from getting it in the first place.

        A big problem in how we’re handling this is that we can’t bear to think of ourselves as a herd.

      2. Rather, I think it was Triage. Cuomo was bracing for the hospitals to be overwhelmed and the people from nursing homes were “going to die anyway”.

        The original policy, issued from the department of New York Health Commissioner Howard Zucker, had come amid a “scramble to provide more hospital beds.”

    2. ‘The directive was meant to protect those infected with coronavirus from discrimination, a state official said.’

      How many more people are going to have to die before the rest get fed up with social engineering and political correctness run amok?

      1. How many more people are going to have to die before the rest get fed up with social engineering and political correctness run amok? This question is no longer an issue since the USA devolved into “Idiocracy”.

  11. “In April and May, 354 apartment and office properties started missing payments on $7.1 billion in mortgages, according to Trepp LLC, which only includes loans packaged into mortgage bonds.

    Debt donkeys were living paycheck to paycheck and piling essential expenses on their credit cards long before the first Chinese person bit into an infected bat. Now the fragility and fraud of our debt-based “greatest economy ever” is going to be on display for all to see.

    1. “…Now the fragility and fraud of our debt-based “greatest economy ever” is going to be on display for all to see…”

      It’s the velocity of money going into reverse.

  12. The buyers want to buy at 50 cents on the dollar, and the sellers are still remembering the prices from nine weeks ago,’ said Mark Edelstein, chair of law firm Morrison & Foerster’s global real-estate group.

    Remember, knife catchers, it’s the second mouse that gets the cheese.

  13. “The pandemic put a halt to the longest sustained period of economic growth in the country’s history and has global economies facing the largest economic downturn since the Great Depression.

    Never confuse an 11-year orgy of debt-fueled consumption and speculation enabled by trillions in Fed funny money with “economic growth.”

  14. “‘The hotel, retail and senior housing sectors will clearly have more trouble resulting from Covid-19,’ Real Capital Analytics President Bob White wrote.”

    Bob certainly earned his big bucks with that penetrating analysis.

  15. ‘I think we got maybe another 30 days of survival,’ Millard said. ‘Then I’m not sure what happens.’”

    Don’t think the Fed’s going to be able to print this collapse away, Millard.

  16. Rodriguez said based on what he’s seeing in the market, buyers right now are expecting a 30% to 40% discount on assets, but sellers only want to give about 20% off.”

    Pop quiz, sellers: who determines market value?

    A. Buyers
    B. Sellers

    1. “Pop quiz, sellers: who determines market value?

      A. Buyers
      B. Sellers”

      – Also, house prices are determined at the margins. The knife cuts both ways. Just like higher comps pull prices up (remember “over-asking?”, Yeah, me neither), lower comps drag prices down. Just one foreclosure or short sale in a neighborhood starts the ball rolling (down hill)…

    2. Mutual agreement.

      Except without agreement, the buyer buys a different home that’s priced in line with current market conditions, while the wannabe seller remains priced in forever.

  17. Although a lot of capital is sitting on the sidelines, many would-be buyers already own a lot of real estate, which could run into trouble if the virus persists, Millard said.

    We’ve been hearing about this mythical capital sitting on the sidelines, and pent-up demand, ever since Suzanne the Realtor told the hen-pecked husband and his bullying harpy of a wife that “You guys can do this!” Yet oddly, it never seems to materialize – in fact trillions of Yellen Bux have already ascended to the Great Debauched Currency Vault in the sky. So what if this alleged capital, and pent-up demand, doesn’t actually exist?

  18. On listing website Localize.city, for instance, rents have fallen for 70 percent of apartments listed prior to the statewide stay-at-home order, which went into effect on March 20.”

    Unimpressed. Wake me up when rents drop 70% to catch down to median incomes.

  19. ‘I expect we will see people either moving to get a better deal on a bigger / better place, or others downsizing to accommodate lower salary expectations.’”

    Millions of ‘Muricans are going to be moving into the basements and spare bedrooms of whatever friends or family will take them in. That’s going to make “luxury” apartment vacancy rates soar and rents plummet.

    1. make “luxury” apartment vacancy rates soar and rents plummet. It looks like no matter how high the vacancies soar, the rates never really plummet, although they may decline a tiny percentage. Real rent seekers HODL until they get foreclosed on or go bankrupt.

  20. “‘It’s not a fire sale,’ said Leslie Appleton-Young, the association’s chief economist.

    Not yet, Leslie. But when the hopium and stimulus checks run out, fire sale doesn’t begin to describe the cratering we’ve going to see.

  21. “‘It was foreclosed on last year, and last week, a real estate investment trust listed it for $589,000. That’s $2.2 million off its asking price of $2.79 million five years ago — an 80 percent discount.’”

    A good start, but let’s go ahead and move that decimal point on the new price one place to the left.

  22. The San Francisco Chronicle in California. “Sales of existing, single-family homes in April — the first month to show the full force of the coronavirus — dropped a stunning 30.1% statewide and 37.4% in the Bay Area compared to the same period last year, but median prices were more or less unchanged, according to a survey released Monday by the California Association of Realtors.”

    “‘It’s not a fire sale,’ said Leslie Appleton-Young, the association’s chief economist. ‘Typically, prices are sticky on any movement down when sellers don’t have to sell. When you get into a foreclosure situation, you have a bigger problem.’”

    “‘I would call (the decline in sales) dramatic, sudden, breathtaking,’ Appleton-Young said. ‘What it shows is an inability to transact for buyers and sellers and unwillingness to move forward with transactions.’”

    – YoY April, ’20 EHS in CA: -30.1% CA /-37.4% Bay Area. Is that a lot?
    – Median price is a lagging indicator, Leslie. You know that. C’mon.
    ‘It’s not a fire sale.’ – I’m not panicking!!! Take deep breaths, Leslie.
    – ‘Typically, prices are sticky on any movement down when sellers don’t have to sell.’ – True dat. After a year or two though, there could be bargains.
    ‘I would call (the decline in sales) dramatic, sudden, breathtaking,’ – Again, take deep breaths, an don’t panic!
    ‘When you get into a foreclosure situation, you have a bigger problem.’ – There will foreclosures. Any one that doesn’t believe that is “California Dreamin” (apologies to the M&Ps).
    – I personally think it’s just a mix issue… 🙂

  23. ‘Bachelorette’ star Hannah Brown apologizes for using the N-word
    *sorry sweetie; it’s time for a bbc reparation video.

    1. Hannah Brown

      Never heard of her.

      What ignorant bliss I live in by not watching the drivel that is broadcast on TV.

    2. I read that story, and it was alleged she said it singing along to a rap song with the word in the lyrics. Which brings me to the real problem – the double standard where it’s ok for blacks to use the word, but not whites. Sorry, not buying it. It’s either ok for all, or not ok for all. One race doesn’t get special privileges to use a word.

      Reminds me of how “white nationalism” or “white pride” are evil, but it’s just fine to be a member of the Black Panther party, etc. Sorry, not buying that carp either.

  24. From Senior Housing News. “The pandemic put a halt to the longest sustained period of economic growth in the country’s history and has global economies facing the largest economic downturn since the Great Depression.”

    https://realinvestmentadvice.com/is-the-u-s-economy-really-growing/
    Is The U.S. Economy Really Growing?
    Written by admin | Mar 16, 2018

    “Peter Cook is the author of the ‘Is That True?’ series of articles, which help explain the many statements and theories circulating in the mainstream financial media often presented as “truths.” The motives and psychology of market participants, which drives the difference between truth and partial-truth, are explored.”

    “Most people are aware that GDP growth has been lower than expected in the aftermath of the Global Financial Crisis of 2008 (GFC). For example, real GDP growth for the past decade has been closer to 1.5% than the 3% experienced in the 50 years prior to 2008. As a result of the combination of slow economic growth and deficit spending, most people are also aware that the debt/GDP ratio has been rising.”

    “However, what most people don’t know is that, over the past ten years, the dollar amount of cumulative government deficit spending exceeded the dollar amount of GDP growth. Put another way, in the absence of deficit spending, GDP growth would have been less than zero for the past decade. Could that be true?

    Chart 1:
    https://realinvestmentadvice.com/wp-content/uploads/2018/03/1-gdp-less-debt.png

    Chart 2:
    https://realinvestmentadvice.com/wp-content/uploads/2018/03/3-cum-gdp-less-debt.png

    – insert my shocked face here…

  25. Ursine advice for bovine herd members who are smart enough to listen:

    When long-term bulls begin co-opting the bears’ stopped-clock warnings about market risk, it’s time to take some chips off the table and build up a cash position that will enable you to survive the long winter ahead.

    1. Mark Hulbert
      Opinion: Don’t even think of owning stocks unless you’re willing to buy and hold for at least 10 years
      Published: May 19, 2020 at 8:36 a.m. ET
      By Mark Hulbert
      If you want a 95% probability of stocks outperforming bonds, you better plan on 20 years
      All good things about stocks come to those who wait.
      AFP/Getty Images

      With U.S. stocks having recovered from its March waterfall decline to within 13% of its Feb. 19 all-time high, many are wondering if it’s safe to step back into the market.

      In fact, some brokers are now enticing investors with visions of another bull market run like the one that began in March 2009, the longest in U.S. market history.

      Those visions may come to pass, but you’re in for a long wait. In fact, only if you’re willing not to touch your money for 10 years — until 2030 — should you even think of putting new money into the stock market right now.

  26. I’m in Boise and what I’m seeing on the MLS is a lot of vacant houses for sale? I don’t know if there are a lot of flippers or people leaving the state? Weird times indeed.

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