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There’s A Break-Even Point, And Then There’s A Losing-Money Point

A report from Mortgage News Daily. “CoreLogic said the number of loans in each stage of delinquency, with the exception of those in foreclosure, grew in May, the second straight month that early-stage (loans 30 to 59 days past due) and adverse (loans 60 to 89 days past due) delinquencies were up on an annual basis. The company notes year-over-year increases in overall delinquencies in all 50 states with the geography of the increases highly correlated with the pandemic’s impact.”

“The national foreclosure rate, which includes all post due loans including those in foreclosure, more than doubled compared to May 2019, rising from 3.6 percent to 7.3 percent of all mortgages. Early stage delinquencies increased from 1.7 percent a year earlier to 3.0 percent and adverse delinquencies jumped from 0.6 percent to 2.8 percent.”

“The transition rate, which measures the share of mortgages that moved from current in April to past due in May was 2.2 percent compared to 0.8 percent the prior year. By comparison, in January 2007 – just before the start of the financial crisis – the current- to 30-day transition rate was 1.2 percent and peaked in November 2008 at 2 percent. The shift in loan performance in recent months is virtually unprecedented.”

From DS News. “Based on a survey of more than 4,000 Americans, this month marks the fourth month in a row that the nation’s tenants and homeowners struggled to meet their monthly rent and mortgage deadlines. ApartmentList reports, ‘For the fourth straight month, roughly one-in-three Americans failed to make a full, on-time housing payment. Late and unpaid housing bills are accumulating, putting financial strain on many families and deepening concerns of near-term evictions and foreclosures.'”

The Denver Post in Colorado. “About 5% of mortgage borrowers were more than 30 days late in May, compared to only 1.5% in May 2019. And with Colorado’s unemployment rate at an elevated 10.5% in June and enhanced federal unemployment benefits of $600 a week ending in July, more homeowners are likely to become seriously delinquent.”

The Herald Tribune in Florida. “As the coronavirus pandemic continues to undermine the Sarasota-Manatee economy, more homeowners are failing to pay their mortgages on time. The share of homeowners in the two-county region who are at least 30 days late on their mortgage payments ballooned to 6.5% in May, from 5.2% in April and more than double the 2.5% reported one year earlier, CoreLogic reported. The 30-day delinquency rate in Sarasota-Manatee has hit the highest point since the months after Hurricane Irma blasted the region in September 2017, putting thousands of homeowners temporarily out of work.”

“Without further government programs and support, CoreLogic forecasts the U.S. serious delinquency rate will quadruple by late 2021, pushing 3 million homeowners into serious delinquency.”

The Dallas Morning News in Texas. “The share of Dallas-Fort Worth homes seriously underwater has increased slightly since the start of the year. At midyear, more than 30,000 D-FW home loans were seriously upside down — where the debt on the property is way more than the value, according to Attom Data Solutions. Only 2.4% of the loans are out of whack, but the increase is the second quarterly rise in such underwater mortgages this year.”

“Nationwide one in 16 mortgaged homes in the second quarter of 2020 were considered seriously underwater, where the debt on the property was at least a quarter more than the estimated value. In the D-FW area, the largest numbers of properties that are significantly upside down in debt are in Frisco, Allen, Mansfield and Burleson, according to Attom Data. In Dallas, the most significantly underwater homes are in the 75230 ZIP code of North Dallas. The Park Cities and parts of Old East Dallas, including the Lakewood area, also have hundreds of homes that are burdened with debt.”

From Bakersfield.com in California. “A new report advocating rent cancellation and other government-led housing measures in the Central Valley warns that economic fallout from the COVID-19 pandemic could result in evictions for 20,000 households across Kern County. Bakersfield real estate agent Jeanne Radsick, president of the California Association of Realtors, said deferring rent is impractical because tenants won’t be in a better position later to make up overdue rent.”

“Building more single- and multifamily housing would help, she said, but a lasting moratorium on evictions could backfire. ‘Why would anyone want to build rental housing and not be able to charge fair market rents?’ she asked.”

From Fox 10 Phoenix in Arizona. “Some help for struggling landlords in Arizona is on the way in the form of a fund set up by the state as renters continue having trouble making monthly rent payments. The fund is for landlords who are struggling to pay mortgages because they haven’t been receiving full rent if any from tenants. Chris Hughes runs AZ Invest, a rent-to-own program for more than 200 families. He says rent payments aren’t flowing like they once were and he’s happy the state is throwing rental property owners a lifeline.”

“‘Very relieved, yes. That’s great news because rents are down 10 to 15%,’ Hughes explained. Courtney Gilstrap Levinus with the Arizona Multihousing Association, says the $5 million fund helps, but landlords are losing tens of millions of dollars. ‘I know several of our members have applied for the maximum amount of $50 thousand and that’s still a drop in the bucket,’ she said.”

“People aren’t always fond of a landlord’s plight, but if they can’t make mortgage payments because they aren’t receiving rent, the bank takes the property back and everybody loses.”

From KTRV in Virginia. “Governor Ralph Northam announced Friday that the Supreme Court of Virginia has granted his request for a statewide eviction moratorium through September 7. The Virginia Apartment Management Association expressed disappointment with the ruling, saying that it kicks the can down the road. ‘I have heard from some independent owners that may have 1 or 2 rental properties and have people that haven’t paid for multiple months and don’t know what they’re going to do,’ stated VAMA CEO Patrick McCloud.”

From KATU in Oregon. “While thousands of Oregon households have been unable to pay their monthly rent — and bills pile up — advocates say more rent assistance will be needed. Moe Farhoud owns 61 apartment buildings, largely in East Portland. Many of his tenants, he said, live paycheck to paycheck. Of his roughly 1,500 units, he said 331 haven’t paid rent since March, more than 20%. Some people have a rent bill approaching $10,000, he said. In total, he says he is owed close to $1 million in outstanding rents.”

“‘It’s been almost six months since March, and we can’t continue forever. Sooner or later we’re going to collapse,’ said Farhoud.”

From Bloomberg. “While landlords at the priciest, amenity-rich apartments have collected most of their rent payments during the pandemic, owners of older, less fancy units — the backbone of the nation’s affordable housing supply — haven’t fared as well. Tenants at so-called Class C buildings paid 54% of total rents due in June by the middle of the month, according to a study by LeaseLock. In July, even with emergency unemployment relief still flowing, the figure slipped to 37%.”

“Just outside Denver, Debi Stobie and her husband own a 24-unit building that’s their only source of income. She worries that if enough tenants skip payments, it may become impossible to cover fixed costs, like the mortgage and property taxes. ‘There’s a break-even point, and then there’s a losing-money point,’ she said.”

“The 7.5 million units categorized as Class C account for about 35% of the U.S. rental supply, the National Apartment Association estimates. ‘If you’re going to see foreclosures and distressed sales,’ said Robert Pinnegar, chief executive officer of the National Apartment Association, ‘this is were it will be.'”

The Daily Press on New York. “Jennifer Lawrence has finally sold her palatial penthouse in Manhattan for $9.9 million. And she gave up on breaking even on the sale of her Upper East Side abode, putting it on the market for less than the $15.6 million she paid for it back in 2016. If the final sale price is correct, J-Law is out millions, especially when you factor in transaction fees and decorating costs.”

“‘It’s not near anything,’ says New York City luxury real estate agent Dolly Lenz. Lenz added that the movie star ‘paid a little too much when she bought it.’ ‘It didn’t depreciate. She paid too much.'”

From CNBC. “Fannie Mae’s monthly Home Purchase Sentiment Index fell back in July. The percentage of respondents who said it was a good time to buy a home decreased from 61% to 53%. Another sign of the times: Google searches for ‘How to buy foreclosure’ has been a breakout search in the past two months.”

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Almost All Will Be Lost

A report from the LA Daily News in California. "Rampant housing inflation means the federal…

This Post Has 152 Comments

  1. ‘That’s great news because rents are down 10 to 15%,’ Hughes explained. Courtney Gilstrap Levinus with the Arizona Multihousing Association, says the $5 million fund helps, but landlords are losing tens of millions of dollars. ‘I know several of our members have applied for the maximum amount of $50 thousand and that’s still a drop in the bucket’

    Wa? But REIC says Phoenix rents are to the moon Alice, more than any other city in the US?

  2. ‘The share of Dallas-Fort Worth homes seriously underwater has increased slightly since the start of the year. At midyear, more than 30,000 D-FW home loans were seriously upside down — where the debt on the property is way more than the value, according to Attom Data Solutions. Only 2.4% of the loans are out of whack, but the increase is the second quarterly rise in such underwater mortgages this year’

    ‘Nationwide one in 16 mortgaged homes in the second quarter of 2020 were considered seriously underwater, where the debt on the property was at least a quarter more than the estimated value. In the D-FW area, the largest numbers of properties that are significantly upside down in debt are in Frisco, Allen, Mansfield and Burleson, according to Attom Data. In Dallas, the most significantly underwater homes are in the 75230 ZIP code of North Dallas. The Park Cities and parts of Old East Dallas, including the Lakewood area, also have hundreds of homes that are burdened with debt’

    I guess prices have been falling for a while:

    ‘where the debt on the property was at least a quarter more than the estimated value’

  3. ‘The transition rate, which measures the share of mortgages that moved from current in April to past due in May was 2.2 percent compared to 0.8 percent the prior year. By comparison, in January 2007 – just before the start of the financial crisis – the current- to 30-day transition rate was 1.2 percent and peaked in November 2008 at 2 percent’

    We’re already there. BTW I know this post is too long, but I’m trying to catch up to the crater.

    1. “BTW I know this post is too long, but I’m trying to catch up to the crater.”

      Ha ha…best of luck!

  4. ‘Of his roughly 1,500 units, he said 331 haven’t paid rent since March, more than 20%. Some people have a rent bill approaching $10,000, he said. In total, he says he is owed close to $1 million in outstanding rents…‘It’s been almost six months since March, and we can’t continue forever. Sooner or later we’re going to collapse’

    UHS says you can always sell Moe.

    Oh…

    1. Ben, you lying dog-faced pony soldier, you don’t think buyers will be lining up out the door for the opportunity to buy out an apartment building full of deadbeat squatters? But compassion, man!

  5. ‘sold her palatial penthouse in Manhattan for $9.9 million…less than the $15.6 million she paid for it back in 2016. If the final sale price is correct, J-Law is out millions, especially when you factor in transaction fees and decorating costs’

    ‘It didn’t depreciate. She paid too much’

    It was both Dolly.

      1. Also note that her face lacks bone structure. She’s got that round middle-class face which never ages well. Compare her to, say, Katherine Hepburn or Michelle Pfeiffer or Halle Berry. She won’t get the older leading-lady parts.

        1. Also note that her face lacks bone structure. She’s got that round middle-class face which never ages well.

          Interesting point. I wonder why it is that face type is associated with middle class? Because it’s usually attached to a pudgy body and we don’t throw money and rich guys don’t throw marriage proposals at those? All I know is that my Polish relatives tend to be pretty hot as teenagers in a similar girl-next-door way, and then age quickly. That was part of what shocked me in China…women in 40s and even 50s who looked like 30-year-olds to me.

        3. “Mental Toughness is the ability to resist, manage and overcome doubts, worries, concerns and circumstances that prevent you from succeeding, or excelling at a task or towards an objective or a performance outcome that you set out to achieve.”

          She managed Harvey Weinstein to her advantage.

      2. Per wikipedia, she was the highest paid actress in the world in 2015 and 2016. Hopefully she saved some of her paychecks.

        Funny thing, when these money losing starlets get mentioned here, I almost always have to look them up as their names are usually unknown to me. I guess I’m just not into chick flicks.

        1. “Hopefully she saved some of her paychecks.”

          She apparently saved a few …

          “With her personal life currently in order and a stellar acting career, it is little wonder that Jennifer Lawrence’s net worth is estimated at nearly $134 million.”

          1. Still, it’s incredible how skilled members of the movie star profession are at overpaying by millions for real estate and losing millions on the eventual sale.

        2. I guess I’m just not into chick flicks.

          To her credit, she’s picked mostly excellent scripts, like “Winter’s Bone” (bleak as hell, and no chick flick), the Hunger Games series, and Silver Linings Playbook. I wouldn’t characterize most of her movies as chick flicks.

  6. “The national foreclosure rate, which includes all post due loans including those in foreclosure, more than doubled compared to May 2019, rising from 3.6 percent to 7.3 percent of all mortgages.

    Is that a lot?

  7. ‘For the fourth straight month, roughly one-in-three Americans failed to make a full, on-time housing payment. Late and unpaid housing bills are accumulating, putting financial strain on many families and deepening concerns of near-term evictions and foreclosures.’”

    Meanwhile, the Fed’s Ponzi markets keep hitting new highs. One of these things is not like the other.

  8. “Without further government programs and support, CoreLogic forecasts the U.S. serious delinquency rate will quadruple by late 2021, pushing 3 million homeowners into serious delinquency.”

    Maybe those “homeowners” couldn’t afford those shacks in the first place.

  9. Chris Hughes runs AZ Invest, a rent-to-own program for more than 200 families. He says rent payments aren’t flowing like they once were and he’s happy the state is throwing rental property owners a lifeline.”

    It’s outrageous that taxpayer dollars are flowing to speculators. If they have deadbeat tenants, they should be free to evict them and then let true price discovery determine how much rent they can charge.

    1. “How can we possibly sell a resale house when builders are selling new houses for 20% and sometimes 30% less?”

      Because new houses are so poorly constructed?

      2. In our little town people borrowed against their homes during the 125% HELOC craze, and when the crash arrived local builders simply lowered their prices and were still earning a profit, but the HELOC borrowers were clearly upside-down; many jingle-mailed their keys.

  11. ‘I have heard from some independent owners that may have 1 or 2 rental properties and have people that haven’t paid for multiple months and don’t know what they’re going to do,’ stated VAMA CEO Patrick McCloud.”

    The sooner Comrade Northam can drive the independent LLs out of business, the sooner his globalist backers can buy up their distressed properties for a song.

    1. ‘globalist backers can buy up their distressed properties for a song’

      That’s a narrative I see more and more. We can’t let landlords who overextended themselves get bounced, the big bad corporations will buy everything up!

      ‘Let’s stop another Wall Street takeover of single-family homes’

      ‘State Sen. Nancy Skinner, a Democrat from Berkeley, is the Senate Majority Whip and represents the 9th State Senate District’

      ‘The Great Recession sparked a massive transfer of wealth in California and the rest of the nation. It happened on courthouse steps around the country when an estimated 5 million U.S. families lost their homes due to foreclosure. Many of those foreclosed homes were sold in bulk at auctions, and for the first time, large numbers of single-family homes were snatched up by Wall Street firms.’

      https://calmatters.org/commentary/my-turn/2020/08/lets-stop-another-wall-street-takeover-of-single-family-homes/

      There’s actually several narratives. Wall Street – not very involved in this. More the non-banks and fraudulent guberment backed loans. If I hear “wall street” I know some horse-sh$t is coming. Transfer of wealth is another. Where did the refi money go Moe? We’re supposed to feel sorry for a guy with 1,000 apartments?

      I was knee deep in the foreclosure market last decade. The “bulk deals” were small on-line rip offs that almost no one took the GSE’s up on. Another false-hood. There are no “bulk deals” on the courthouse steps. It’s one at a time that anyone can bid on. The problems are numerous though, as is risk. But don’t buy into these narratives that are basically a REIC stance for a bail-out.

        1. There’s a lot of distortion. For instance, the CRE fraud story yesterday is too widespread for there not to be appraisal fraud out the ying-yang. And there are some investment banks involved: let the lawsuits begin. Here we are the next day, and crickets. Where’s Bloomberg, CNBC and NYT with a follow-up on that WSJ block-buster? And why is it revealed by UT professors? These loans could cost .gov over a trillion bucks.

          1. “That’s a narrative I see more and more.”

            “There’s a lot of distortion.”

            Hey, you use what works.

          2. “too widespread for there not to be appraisal fraud out the ying-yang.”

            You don’t arrive where we are without it…… and out the ying-yang.

          3. “You don’t arrive where we are without it…… and out the ying-yang.”

            Again, you use what works.

          4. Where’s Bloomberg, CNBC and NYT with a follow-up on that WSJ block-buster?

            Where are our worthless, captured regulators, enforcers, and policymakers?

          5. “Here we are the next day, and crickets. Where’s Bloomberg, CNBC and NYT with a follow-up on that WSJ block-buster?”

            We saw a preview of how cratering megabanks can successfully keep bad news hidden for months or even years during the 2007-2009 financial debacle, thanks to a complacent, complicit MSM that is happy to turn a blind eye to major news stories which are left to the blogosphere to piece together from disjunct bits of information the MSM lets slip. The Bear Stearns blowup in March 2008 was a classic example. It took another six months for the real damage to shoe up in a version that could no longer be swept under the rug.

            When the full dimensions of the crater are finally too big to hide from the public, you can rest assured that the MSM expose will be accompanied by their traditional tag line: “Nobody could have seen it coming!”

      2. But don’t buy into these narratives that are basically a REIC stance for a bail-out.

        As you know, Ben, I’m completely opposed to any government meddling in the housing market, whether it’s bailouts for landlords of any size, or providing billions of Yellen Bux for Wall Street vulture funds like BlackRock. The government’s role role be limited to preventing fraud, ensuring lending standards are adhered to so the financial system isn’t compromised, and ensuring honest and competent building inspections and certifications.

        1. You can’t clear the decks without distressed sales. I sat in on a big-wig apartment web thing a couple of weeks ago. You know what they are counting on? Unemployment checks and more stimulus. It’s not sustainable. Oh and they are adamant they can’t build work-force priced apartments. Apartments used to be work-force housing. That’s how detached from reality the entire industry is.

          This is a credit event and it’s going to be ugly.

          1. You can’t clear the decks without distressed sales.

            I couldn’t agree more. I’m opposed to gub’mint interfering in contract law, which is yet another huge overreach, by declaring rent moratoriums. Sorry, but if you signed a contract and now you can’t honor it, then GTFO. If your landlord goes bust anyway because he overpaid and can’t find creditworthy renters for what he’s asking, that’s the free market doing its thing. Speculative FedBux and gub’mint meddling have distorted everything.

          2. “You know what they are counting on? Unemployment checks and more stimulus. It’s not sustainable.”

            Yeah those $600 stimulus checks are the only thing holding up the luxury real estate market. Stupid is what stupid sez…

          3. but if you signed a contract and now you can’t honor it, then GTFO.

            Boo, I’d like to agree, but we’re dealing with a pandemic. If people make poor life choices and get tossed on their ear, so be it. There’s some safety net for that, and the system can handle it. But this is massive and happened all at once. We can’t blame “poor life choices” and the system can’t handle the volume. Maybe a year of trickle-up bennies isn’t such a bad thing.

            That said, the gov should have handed out UI+ $600, *or* eviction moratoriums, but not both! $2400 should be enough to cover basic bills and keep the LLs afloat. If you can’t pay your rent and food on $2400/month, then yeah, I have a lot less sympathy.

          4. We can’t blame “poor life choices”

            We absolutely can. You can’t handle a patch of unemployment? Poor life choice — you should have lived below your means and saved.

            Your government shut down your business? Poor life choice – you voted for or lived somewhere others voted for poor government. Pay the price, learn, and move on.

            People need to stop being insulated from their poor choices, especially if it means they suffer. And if that suffering spills over to those who didn’t make poor life choices, then they need to learn to not be tolerant and supportive of others making poor choices.

      3. There are no “bulk deals” on the courthouse steps.

        Agreed.

        I seem to recall that last time the BlackRocks would often buy short sales and turn them into rentals. But that still has to be done one at a time. I suppose they could send representatives to the auctions and only buy if they got the price they wanted.

        Having to choose between greed head mom-n-pop landlords and greed head corporate land lords makes me think of those memes where there are two red buttons to push, both with bad outcomes and the chooser is sweating profusely.

        1. IIRC it was blackstone. They were buying post-foreclosure though. Almost none of that happening today. The defaults sit in pre-foreclosure waiting for the auction market to clean up the mess. That means pretty much buying sight unseen (interior), lots of risk. Unless you know what you’re doing.

          The bulk deals were real, but the GSE’s would offer a package of 50-100 houses. They’d be in 13 states or more, a lot of them 100 years old, etc. Junk. And so spread out it would be very difficult to size up what you were getting.

          The narrative includes that these firms “bought-up” a significant number. It’s just not true. All together it came to a little over 200,000 housing units. There were many millions of foreclosures.

          1. ‘Next Wave Investors has sold Harlow Luxury Apartments, a 98-unit Class A community in Las Vegas. According to Yardi Matrix, Benedict Canyon Equities acquired the asset for $21.5 million. Walker and Dunlop secured a $16 million Freddie Mac acquisition loan. Next Wave acquired the property in 2019 from Pathfinder Partners, for $17.1 million.’

            https://www.multihousingnews.com/post/next-wave-investors-sells-luxury-las-vegas-community/

            These are the people we’re supposed to feel sorry for.

          2. ‘The amount of rent payments collected in the U.S. has ticked down slightly to 79.3% of apartment households making a full or partial rent payment by August 6, according to the National Multifamily Housing Council’s Rent Payment Tracker. NMHC said that rent collections in early August are as expected, based on collections during the previous few months, but the cut-off of extra unemployment benefits may make things worse.’

            “Over the past few months apartment residents have largely been able to meet their housing obligations,” David Schwartz, NMHC chair and CEO said in a statement. “In no small part, this is due to the enhanced unemployment benefits enacted under the CARES Act and significant steps by apartment owners and operators to help their residents.”

            “These unemployment benefits that have proven so important to so many households have now lapsed, meaning greater financial distress for millions and the potential worsening of America’s housing affordability crisis,” Schwartz said.’

            ‘According to RealPage, missed payments were most frequent in lower-priced Class C properties. Through August 6, this month’s rent was collected from 72.7% of the residents in Class C units, while 82% to 83% in the Class A and Class B inventories were made in time. Year over year, rent collections are 7.7 percentage points lower in Las Vegas; 7.5 percentage points off in Los Angeles; and 7 percentage points off in San Jose. The smallest share of rent collected was in New York, where 64.5% of households were up-to-date on rent payments, RealPage said.’

            https://www.housingwire.com/articles/rent-payments-collected-in-august-tick-down/

          3. I forgot to mention: the bulk deals were often non-performing loans, not the shacks themselves. Which would mean if you were the winnah, you got maybe 3 years of legal fees to do the actually foreclosure. On every house.

          4. “The narrative includes that these firms “bought-up” a significant number.”

            And the “awww shucks theres nothing we can do about it” canned response is still heard to this day.

            Housing prices are cratering….. that’s about the only thing you can’t do anything about….. Cratering.

          5. These unemployment benefits that have proven so important to so many households have now lapsed, meaning greater financial distress for millions

            Is it me, or does this sound like they are preparing to make a serious case for UBI? We have bad recessions before, yet no one ever made a case for $1000 a week in free money. Now the narrative is that if that gets taken away then it’s the end of the world.

        2. Here’s the article: https://www.motherjones.com/politics/2014/02/blackstone-rental-homes-bundled-derivatives/

          “Through its subsidiary, Invitation Homes, Blackstone has picked up houses through local brokers, at foreclosure auctions, and in bulk purchases. Last April, it bought 1,400 houses in Atlanta in a single day… Today, it is the largest owner of single-family rental homes in the nation.

          Blackstone’s deep pockets—$248 billion in assets under management and a $3.6 billion credit line arranged by Deutsche Bank for buying houses—allow it to outbid individual buyers, driving up local real estate prices and pushing families out of the market. “You can’t compete with a company that’s betting on speculative future value when they’re playing with cash…” ”

          P.S. I’d missed the detail about DB being involved. No surprise there.

      4. We can’t let landlords who overextended themselves get bounced, the big bad corporations will buy everything up!

        Like small time speculator’s motives are so much more pure. They are all gamblers looking for someone else to cover the losses.

      5. Very true. There were decent caveat emptor deals 10 years ago in Southern AZ. No bulk deals, but individual sales by HUD or out-of-state banks (who appeared desperate to unload).

  12. Did folks know that REITs have to depreciate buildings (mostly straight-line – say 5% per year for 20 years)?

    No wonder – that they are feeling better than the average landlord.

    I started looking because I was starting to ask why the ‘luxury apartments’ in Seattle (south lake union, belltown, downtown and queen ann) were not suffering (any more than 2019 because of the pandemic).

  13. “…Apartment List reports, ‘For the fourth straight month, roughly one-in-three Americans failed to make a full, on-time housing payment. Late and unpaid housing bills are accumulating…”

    In other words, people are running on the fumes.

    Raiding a 401(k), credit card, or family loans can only take these folks so far. How much over the top these households really are is a very difficult statistic to collect.

    However, if these statistics *could* be collected in a reliable manner, it wouldn’t surprise me one iota if, in reality, 2 in 3 households are standing on the abyss.

    2. Aren’t we still under an eviction moratorium? How many people stopped paying simply because they could? For example, when the pandemic hit, the utilities immediately ceased shutting off power for non-payment. I’m sure there are people who simply stopped paying utility bills even if they had the money. It’s their way of sticking it to the Man.

      On some level I’m sure they know that they’ll eventually have to pay for power and rent. But when the bill actually arrives, I’d bet that they’ll take to the streets anyway, claiming disparate impact and all the rest.

  16. I have an acquaintance in Northern Virginia who is planning to sell in about 6 weeks. He says houses are selling within days in his area — McMansions in the $700-800K range and luxury townhomes in the $400-500K range. I looked up a random portion of his area: 25 homes for sale, and 18 of them are pending.

    There’s lots of money in NoVa, and they all kept their jobs W@H. Trades crews are so busy that their house won’t be fixed up until mid-September.

    I had been thinking to have some home improvements done, but maybe I’ll wait until next summer or fall, after the rush to the burbs is over.

    1. I really don’t understand this madness. How can you have over 40 million unemployed and record stock prices, houses going pending in a week, etc.? Something is NOT adding up.

      2. As I said, they all kept their jobs. These aren’t working-class stiffs collecting tips at Ruby Tuesday or handling luggage at Dulles Airport. They were mostly IT or defense contractors or analysts. If they were anything like me, they were already on the verge of working inside a paperless cloud, and transitioned to w@h seamlessely.

        In my friend’s case, evidently they are building a new Catholic school campus in the town. Wealthy bio-clocked Millenials (GenZ? H1-Bs working on anchors? who knows) are calling realtors, trying to score housing by the new school.

  17. “Nationwide one in 16 mortgaged homes in the second quarter of 2020 were considered seriously underwater, where the debt on the property was at least a quarter more than the estimated value. ”

    At least lending has been tight. These people have so much equity built-in that they can wait it out or sell for profits!

  18. Headline: European Stocks Rise as Investors Shrug Off UK Economy’s Record Collapse.

    The disconnect between the oligarch-looted, COVID-ravaged real economies in the western democracies, and the Ponzi markets and asset bubbles blown by radical Keynesian monetary experiments, gets more outlandish by the day, along with the resultant wealth inequality as the financial oligarchy engages in the unfettered looting and asset-stripping of the productive economy.

    https://www.marketwatch.com/story/european-stocks-rise-as-investors-shrug-off-u-k-economys-record-collapse-11597224132?mod=mw_latestnews

  20. ‘JLL Capital Markets has arranged $24 million in refinancing for Enclave at Northwood, a 188-unit community in Clearwater, Fla. Senior Managing Director Elliott Throne, Directors Amit Kakar and Jesse Wright and Associate Drew Jennewein secured the Freddie Mac loan on behalf of the borrower, a private equity partnership managed by Preston Giuliano Capital Partners.’

    ‘The private equity partnership acquired the property in 2015 by assuming a Freddie Mac loan. The owner also placed a supplemental loan after completing internal and external renovations in 2018. The current refinancing repays both loans and provides funds for additional improvements.’

    https://www.multihousingnews.com/post/jll-arranges-24m-refi-for-tampa-area-community/

    1. Looks like the Fed’s Ponzi markets might be in for a reprise of yesterday, when the HTF algos and Robinhood dupes bid up the markets early, before the weight of accumulating bad news caused all three indexes to close in the red despite the frantic efforts of the PPT in the last hour of trading.

  22. Are you ready for the following, 24/7, if the marijuana ticket captures the White House?

    – BLM and womyn’s issues in your face all the time?

    – The reincarnation of St. Greta as climate change comes back to the fore?

    – Debt forgiveness for everyone on unpaid student, car, home, and credit card debt

    – Modern Monetary Theory becomes a blanket justification for Fed helicopter drop policy

    – UBI for everyone

    – Free housing and medical care for illegals

    Did I miss any elements of the marijuana ticket platform?

    1. Paul Brandus
      Opinion: Biden lays a trap for Trump in picking Harris
      Published: Aug. 12, 2020 at 7:50 a.m. ET
      By Paul Brandus
      President Trump will likely insult and demean Kamala Harris, angering women voters, who already overwhelmingly support Democrats
      U.S. Sen. Kamala Harris
      Getty Images

      After months of speculation, Kamala Harris, the 55-year-old junior senator from California, is Joe Biden’s pick for vice president.

      She’s the first black woman to be on the ticket of a major U.S. political party, and if current polls — notably in key swing states — hold up, she will soon become the 49th vice president of the United States.

      in the 2018 midterms, women voted for Democratic congressional candidates by a stunning margin of 59% to 40%.

      This is the moment the Trump campaign has been waiting for. In recent months, it has compiled dossiers on everyone Biden was considering. Now get ready for a ton of opposition research (“oppo”) to be dropped onto the media in an effort to undermine Harris.
      …

      1. insult and demean Kamala Harris, angering women voters,

        I’m a woman and I have to vote for a woman, or else I need to question my womanhood. Yeah, BS. It didn’t work in 2016 and won’t work in 2020, not for me anyway.

        1. Funny thing happened in 2016 on the way to Hillary Clinton capturing the votes of the more liberal female voters in my family. After Feeling the Bern, they all decided they liked a male candidate better, and sent him their campaign contributions instead.

    3. Are you ready for the following, 24/7, if the marijuana ticket captures the White House?

      Tulsi Gabbard scorched Kamala Harris during the Democrat debates for her hypocrisy as a prosecutor, jailing 1,500 mostly minority youth for marijuana offenses, while she cackled about smoking weed herself.

      https://www.youtube.com/watch?v=GxHORNMWPmg

      TulsiGabbard went hard at Kamala Harris’s record as a prosecutor: “She put over 1,500 people in jail for marijuana violations and then laughed about when she was asked if she’d ever smoked marijuana.”

      2. Tulsi Gabbard scorched Kamala Harris during the Democrat debates

        And not coincidentally (IMO) that was the last public DNC sponsored debate she was allowed to participate in and after that she was consistently referred to as a Russian asset by people who care about DNC politics.

    4. Forgot a few:

      – Cancel culture will be used to purify all thought to conformity with Democratic party-approved memes

      – Green New Deal becomes the law of the land

      – Open borders lead to a flood of illegals who instantly take up black labor market occupations that exempt them from paying income taxes but instantly qualify them for free schooling, housing, and medical care provided by taxpaying U.S. citizens.

      1. This is the future I foresee, regardless of who wins this November.

        Thus I’ve been leaning away from ever buying a house, toward buying a 4WD Sprinter van instead.

        1. buying a 4WD Sprinter van

          Used is a better deal but almost nobody buys 4WD RVs new so they are unicorns on the used market. So yes, if you want to buy new get the 4WD. It’ll be really easy to sell if that time comes. Also get the diesel if it’s an option. I towed a loaded car trailer yesterday up and down some hills between Folsom and the coast with the big heavy gas RV to see how it would go. It was acceptable but the diesel would have been really nice.

    5. People who come to the nuisance and buy cheap housing near polluting plants will have the legal upper hand to force them to stop emitting pollution, in the name of Environmental Justice.

      Election
      VP nominee Kamala Harris has a particular climate-change agenda: environmental justice
      Published: Aug. 12, 2020 at 1:22 p.m. ET
      By Rachel Koning Beals
      The former California AG, with proposed Climate Equity Act, has already indicated she’ll address air quality in poorer zip codes and punish those who pollute
      …

    6. Did I miss any elements of the marijuana ticket platform?

      $20 for a loaf of generic grocery store bread. Brands like Orowheat will cost even more.

      As for the woke issues being in our face all the time, they already are. Even though I have an HD antenna I just don’t bother to watch anything that is broadcast anymore. It’s all Narrative all the time.

      1. “As for the woke issues being in our face all the time, they already are.”

        But they could get a lot worse with a Democrat back in the WH.

    7. You also forgot that you only get all this free cheeze if you make less than $100K per year. Those who worked their way up to a six-figure job with decades of schooling and hard work get to foot the bill directly. By “directly,” I don’t mean some vague tax and budget deficit. I mean that I will make the same $100K that I did before, but I have the pay the high prices. This will destroy what’s left of the middle class.

      1. I think they’ll give the UBI to everyone. It will make it easier to sell. And they might create a VAT to help pay for it, though it won’t come close to covering it.

        1. As Senator, Harris backed that proposal to hand out $2K to everyone until 3 months after the end of the pandemic… as long as you made less than $87K.

          The money is too high, the cutoff is too low… and they were going to give $2000 to each KID as well. My neighbors would get $10K/MONTH while I get nothing. No effing way.

    1. As aqdan religiou$ly $tated time & time again, thee.🍊jesus will only bee respon$ible for the “Final” U$Deficit #’$ that are on record the day he’$ dragged out of the White.Hou$e. ($ad)

      US budget deficit climbs to record $2.81 trillion$
      By MATT OTT / AP News

      SILVER SPRING, Md. (AP) — The U.S. budget deficit climbed to $2.81 trillion in the first 10 months of the budget year, exceeding any on record, the Treasury Department said Wednesday.

      The nation’$ budgetary $hortfall is expected to eventually reach level$ for the fi$cal year more than double the large$t annual deficit on record.

      Ala$, Boeing i$ (-) Negative 836 planes YTD 2020 (No tailwind$, $ad)

      Natural ga$ record lows … ( knot helping his promi$ed full.coal.car$ recovery, $ad)

    2. Those traders seem to smell a lot of inflation plus future building demand for lumber.

      Seems like we may have an unprecedented number of vacant homes in a few years, given that the builders are on a tear against a backdrop of collapsing SFR demand.

      1. “Those trader$ $eem to $mell a lot of inflation…”

        yous making ‘ em laugh over there @ thee Federal.Re$erve. “UNLIMITED!” eat.yer.lunchroom.

        1. Hyperinflation. It’s coming.

          We’ve had five decades of massive inflation, and now you’re warning us of inflation? If there is a sea change, expect something different than what you’ve become used to.

          1. Check the FED’s balance sheet 5 decades ago as compared to now. Apples to oranges, my friend, we’re in uncharted waters. Just look around you.

          2. I see people with debts and expenses that are not sustainable and income that is decreased. I’m not sure the stuff on the FedRes’s balance sheet will be worth schizza. People have to borrow more for there to be much inflation.

            Something else comes first, defaults.

          3. People have to borrow more for there to be much inflation.

            No, there only has to be more currency printing. They are handing out money like candy right now. $52,000 per year to sit on the couch and get high.

    1. Don’t “they” draft kid$ @ 13 yrs old? … Will free $port gambling 🎲🎰offer great $tarting $alarie$ fer the newly minted rookie$?

      Maybee they should focus$ on ping-pong, beer-pong & Boce tournament’s @ the uni’$.

      Gifted the $tudents/revenue provider$ with an iPhone & a Robinhood acct. Offer 1/2 credit units for ma$tering skills.

    2. “College football cancellations will cost big universities billions of dollars”

      A small price to pay to get President Harris elected.

      1. Correct. And the jury is still out on whether it even worked WITH it. So far it still just looks like buying customers using early investor money in order to show growth and suck in more investors. You know, the business model invented by Boston Chicken and Wall Street and used by everyone since then…

        1. In addition to the tax/regulatory arbitrage, another feature of these business models is the employees’ responsibility for capital expenditures.

          1. another feature of these business models is the employees’ responsibility for capital expenditures.

            Translation: It’s the P.T. Barnum business model.

      1. We are in a crisis, the worst crisis in my lifetime since the Second World War. I would describe it as a revolutionary moment when the range of possibilities is much greater than in normal times. What is inconceivable in normal times becomes not only possible but actually happens. People are disoriented and scared. They do things that are bad for them and for the world.

        — George Soros

      1. “What a sham the Dems are.”

        As desperate as the Democrats claim to be it is amazing to me that the DNC party machinery produces a senile man for the POTUS and directs him to select a tepid female VP. WTF?

        1. And they intentionally screwed their strong candidate twice in an obvious signal that they preferred Trump to him. IMO the DNC doesn’t represent their true believers at all.

          1. IMO, the next term will be one of the most demanding in our lifetimes. Maybe it is their preference to simply build their brand without having to deliver, i.e. throw the contest.

          2. Maybe it is their preference to simply build their brand without having to deliver, i.e. throw the contest.

            Could be. But their base is going to lose their minds if they keep ratcheting up the crazy with no relief.

  31. Read today that Boise median price is up $15k in the past month alone to an all time high of $390k. As the exodus from Portland and Seattle gathers steam post riots, Boise, Yakima, Missoula, Bend, etc prices will continue to increase.

  32. If you go to antifa dot com, you’re re-directed to ChinaJoe and His NastyHo’s website.

    Sickening.

    DonK.

    1. I’ve said this before: I wonder what impoverished 3rd worlder’s would think if they could see all these fat, overfed people in nice late model cars that cost more than they will earn in a lifetime, coming to get free food because they’re broke.

      1. Or what they would think upon learning that the unemployed were getting up to $1000 a week for doing nothing?

        No wonder there were caravans trying to crash the US border.

  35. “Governor Gavin Newsom started his Wednesday coronavirus news conference by taking a page out of Donald Trump’s press conference playbook.
    The governor began by recalling how he started his first business by writing to 14 people he knew and asking for start-up money.
    Newsom’s focus on business came after what can be said to be one of the worst weeks of his tenure, as news leaked out about a massive data failure in the state’s coronavirus data reporting system. The governor did not address the issue, nor hold one of his regular press conferences for nearly a week. His first comments came on Monday and, it seems, he sought on Wednesday to turn the page on the debacle.”

    1. how he started his first business by writing to 14 people he knew and asking for start-up money

      https://calmatters.org/commentary/2019/01/gavin-newsoms-keeping-it-all-in-the-family/

      “Gavin Newsom had been informally adopted by the Gettys after his parents divorced, returning a similar favor that the Newsom family had done for a young Gordon Getty many years earlier. Newsom’s PlumpJack business (named for an opera that Gordon Getty wrote) led to a career in San Francisco politics, a stint as mayor, the lieutenant governorship and now to the governorship, succeeding his father’s old friend.”

      If only I had such wealthy friends!

  39. Ouch!

    New fee on mortgage refinances could cost homeowners

    Refinance mortgage loans sold to Fannie Mae and Freddie Mac after Sept. 1 will include a new adverse-market refinance fee of 0.5%, the two government sponsored enterprises announced Wednesday night. This fee will be assessed for both cash-out and no-cash-out refinances.

    “In light of market and economic uncertainty resulting in higher risk and costs incurred by Fannie Mae, we are implementing a new loan-level price adjustment,” the letter from the larger of the two government-sponsored enterprises said.

    Freddie Mac’s bulletin specifically cited the pandemic.

    “As a result of risk management and loss forecasting precipitated by COVID-19 related economic and market uncertainty, we are introducing a new Market Condition Credit Fee,” it said.

    With refinance activity rising to 65.7% of total applications – posting 12 straight weeks of year-over-year growth – the fee’s effects will be felt immediately.

    https://www.housingwire.com/articles/new-fee-on-mortgage-refinances-could-cost-homeowners-1400/

    1. “You have a basic bat coronavirus and you have two things that have been added to it. The spike protein is closest to an animal called the pangolin. We do know that somehow this bat virus was infected by at least two other animals and then went into a human host. And for that virus to be the way it is, it had to happen simultaneously.”

      The author isn’t presenting clear thoughts.

      Putting quotes around your own paragraphs is a peculiar technique.

      1. “For the complete q/a format Interview with Andrew Kimbrell, see 34 Corporate Crime Reporter 30(10), Monday June 27, 2020.”

      2. The thought is clear enough. The author is saying that this was a man-made virus, cobbled together from existing viruses.

        1. The thought is clear enough.

          Sure, the “conclusion” is simple enough. The path, not so much.

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