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The Discrepancy Illustrates That Buyers Are Seeking More Space For Less Money

A report from the San Francisco Chronicle in California. “HubHaus, a venture-backed startup in the burgeoning new field of ‘dorms for grownups,’ has imploded, stranding hundreds of renters and homeowners, mainly in the Bay Area. The 4-year-old Los Altos company, which had raised $13.4 million, is undergoing ‘a closure and liquidation process, commencing Sept. 23, 2020,’ it wrote in emails to homeowners and tenants. It’s laid off all employees, the letter said, blaming the coronavirus pandemic’s severe impact on housing.”

“Many landlords who had rented their homes to HubHaus said in interviews that it had already slashed the rent it was paying them in recent months, leaving them tens of thousands of dollars in the hole. Several said they were stunned to discover that it had also stopped paying utilities months ago. (Because of the pandemic, utility companies are not cutting off service for nonpayment.)”

“In November 2019, Oakland resident Darcey O’Callaghan leased HubHaus her former residence in Washington, where the company had recently expanded. It now owes her $19,000 in back rent, she said. Ryan Hernandez rented his family’s Oakland home to HubHaus when they moved to Montreal two years ago. ‘They started underpaying the rent back in May,’ he said. ‘It’s been touch and go since then; they owe a bit over $15,000 in rent.’ On top of that, he soon discovered ‘thousands of dollars in unpaid utilities’ that he could be liable for. In addition, the company stopped having the house cleaned months ago.”

“Clara Arroyave, who was CEO of a smaller co-living startup in Boston, shed some light on what may have happened during the pandemic. ‘Similar to everyone else (who runs corporate group homes), in the middle of March, we saw 40% of our revenue disappear in a matter of five days,’ she said, as renters who were now working from home left the city. The drain continued. ‘By the middle of June 60% of people had left, which was not enough for us to cover obligations,’ she said.”

“O’Callaghan, the Oakland owner of the Washington home, plans to file in small claims court, where the damage limit is $10,000, half what she’s owed. ‘I honestly don’t think I’ll see a penny, but I really wanted some sort of legal record of what they did,’ she said. ‘It needs to be addressed more broadly when a company goes under that has millions in venture backing from millionaires and billionaires. I don’t even have a job right now.'”

From Livable in California. “The latest report from Zumper suggests that the median rent for a one-bedroom apartment in LA totaled $2,020 in September, down 10.7 percent since March and 11 percent year-over-year. This represents a savings of about $228 per month — a not-insignificant chunk of change. Median two-bedroom rents have tumbled at a similar rate, declining 7.8 percent compared to March and 11.1 percent over the same period last year.”

“San Francisco recorded a whopping 20.3 percent annual price drop for one-bedroom apartments in September. ‘Not only is this drop among the largest yearly decreases Zumper has ever recorded in our history of tracking rental prices, but it was also the first time the median 1-bed price in San Francisco was priced below $3,000,’ wrote Neil Gerstein, a Zumper data analyst.”

The Midland Reporter Telegram in Texas. “Rents in Midland during the month of September were down 20.7 percent since the start of the pandemic in March and down 29.5 percent year over year, according apartmentlist, which shared information this week with the Reporter-Telegram about average rents in Midland that dropped for the 16th straight month and that have renters paying as little as $746 for the average one-bedroom and $912 for the average two-bedroom apartment.”

“‘West Texas has provided some of the wildest rent swings in the country,’ wrote Rob Warnock in an email to the Reporter-Telegram. ‘And the boom-and-bust cycle of Midland’s economy is mirrored in its rental market. Per our data, rents rose quickly from 2017 to mid-2018, remained high for about a year, and then have dropped precipitously since mid-2019. The median two-bedroom apartment in Midland rented for as much as $1,403 in July 2018 and now goes for just $912. One-bedrooms are down to $746 after peaking at $1,149 in 2018.'”

From Forbes. “If you are in the rental market and able to wait a few months to move the rental landscape may offer the potential to secure a good deal. Brian Carberrry, managing director at Apartment Guide has advice to buyers. ‘You may be working remotely and now can look in areas you would not have before. Be willing to ask for incentives and don’t be afraid to negotiate. You can ask for anything from free parking and utilities to flexibility on lease terms. The worse thing that can happen is the owner will say no. As the renter, you now have the power.'”

The Idaho Statesman. “Boise developer Greg Ferney envisioned an apartment complex at the site of a former health club near the Boise State University campus. His Storage Development company drew up plans for a four-story, triangular-shaped building with 125 apartments at 1250 S. Division Ave. Ferney modified his design to appease neighbors and won approval from the City of Boise. Now he’s looking to sell the property and the development rights. But Ferney isn’t saying why.”

“The offering lists a sale price of $4.5 million for the 2.9 acres of land and development rights. That equates to $36,000 per apartment, according to the listing. Offers are due by 5 p.m. on Sunday, Oct. 4.”

From Real Estate Weekly on New York. “Based on Q3 absorption rates (averaging 12.8 units a week), it would take roughly 22 months to absorb the 1,095 active units currently on the market in Manhattan. The average Q3 new development discount in Brooklyn from the last ask or last amendment was five percent while Manhattan saw larger discounts averaging 13 percent. ‘The discrepancy between median asking price for new development units and the average price for contracts signed illustrates that buyers are seeking more space for less money and are willing to enter submarkets that provide the best bang for their buck,’ said Stephen Kliegerman, president of Brown Harris Stevens Development Marketing.”

From Hawaii News Now. “Cherlyn Reyes is a first-time landlord. A family of five adults has been renting her West Oahu home for more than a year, but they haven’t paid their rent since June and their lease expired on Aug. 31. For now, she can’t evict that family. Reyes says she understands the need to help renters, but asks: What about landlords?”

“There is a state-managed housing assistance program, where rent payments of up to $2,000 a month are made directly to landlords. But tenants are the ones who need to apply. And Reyes believes her renters may make too much take-home pay to qualify. In the meantime, having no rent payments has stretched her own finances.”

“‘You know, we’re still paying our mortgage. We’re still paying our taxes. And on top of this, it’s a business, so we have to pay our business tax. I have to pay my GE (general excise) tax for all of that,’ she said. Reyes said she has spoken to lawyers, but fears that she won’t see that money paid back. ‘They’re planning to move,’ said Reyes. ‘What if they move out of state? Then I can’t file damages in the state (of Hawaii). So it really leaves us hanging.'”

This Post Has 115 Comments
  1. ‘Now he’s looking to sell the property and the development rights. But Ferney isn’t saying why. The offering lists a sale price of $4.5 million for the 2.9 acres of land and development rights. That equates to $36,000 per apartment, according to the listing. Offers are due by 5 p.m. on Sunday, Oct. 4’

    This article has a guy saying this isn’t unusual. Yeah, putting it up on 48 hours notice over a weekend isn’t unusual.

  2. ‘You know, we’re still paying our mortgage. We’re still paying our taxes. And on top of this, it’s a business, so we have to pay our business tax. I have to pay my GE (general excise) tax for all of that…They’re planning to move,’ said Reyes. ‘What if they move out of state? Then I can’t file damages in the state (of Hawaii). So it really leaves us hanging’

    We’re all in this together Cherlyn.

  3. ‘rents rose quickly from 2017 to mid-2018, remained high for about a year, and then have dropped precipitously since mid-2019. The median two-bedroom apartment in Midland rented for as much as $1,403 in July 2018 and now goes for just $912. One-bedrooms are down to $746 after peaking at $1,149 in 2018’

    A few years ago Midland lead the country for percentage increase in luxury apartments. I went out there in 2017 and they were building like crazy.

    1. This sh!t is nuts everywhere, but I imagine the oil patch was even worse. I was talking to a guy Friday who just bought a house – at the peak. He sold one, too, so I suppose it’s not as bad as somebody getting into the market for the first time. He bought a brand new house that’s not even finished yet. The development was just dirt less than 9 months ago and they’ve already built out 300 or so. The quality is atrocious. Even he admitted that. $590,000. I looked at them and see a $150,000 house.

  4. ‘‘Similar to everyone else (who runs corporate group homes), in the middle of March, we saw 40% of our revenue disappear in a matter of five days…By the middle of June 60% of people had left, which was not enough for us to cover obligations’

    How many of these co-crap deals have blown up now?

    ‘O’Callaghan, the Oakland owner of the Washington home, plans to file in small claims court, where the damage limit is $10,000, half what she’s owed. ‘I honestly don’t think I’ll see a penny, but I really wanted some sort of legal record of what they did,’ she said. ‘It needs to be addressed more broadly when a company goes under that has millions in venture backing from millionaires and billionaires. I don’t even have a job right now’

    Readers may remember that Chinese student thing in Davis CA that died in the arse.

  5. ‘They started underpaying the rent back in May…It’s been touch and go since then; they owe a bit over $15,000 in rent.’ On top of that, he soon discovered ‘thousands of dollars in unpaid utilities’ that he could be liable for’

    Is this a California thing? In Arizona the utilities have to chase the persons that signed for the contract.

    ‘In addition, the company stopped having the house cleaned months ago’

    Lovely.

    1. thousands of dollars in unpaid utilities

      Don’t they just cut the utilities if you don’t pay? Some years ago, when I still mailed in my payment, it got lost in the mail. I only found out because about a week after the due date I received a letter stating that my power would be cut off by the date specified (about 3 weeks later) if I didn’t pay up.

      How did they rack up thousands in unpaid utilities?

      1. Utilities placed a moratorium on shutoffs because of the pandemic. It won’t be long before the cancel-rent crowd demands free electricity too.

        1. So … how are utilities not going under? I don’t recall there being a utility bail out in the last corona bill.

    2. they owe a bit over $15,000 in rent

      My husband has La Jolla tenants who are $16K behind in rent. They’re being served with papers requiring them to document a loss of income because of COVID. The wife is an assistant district attorney making something like $225K/yr. My husband suspects she doesn’t know that her husband has failed to pay rent in full for the last 6+ months.

      1. I fear that in such a scenario, housing speculators may not get the return on investment (ROI) they had anticipated. In fact (gasp!) they could end up deep in the red before the scamdemic-related freeloading ends up running its course.

        This is my sorrowful face.

      2. Don’t the governor’s and president’s COVID-19 moratoriums permit tenants the legal right to temporarily stop paying their rents without threat of eviction?

        I’m not saying I agree with the new rules that throw landlords under the bus. But it is what it is.

        1. The silver lining is, 8 million small landlords might take a more active interest in property rights and government overreach.

          1. There is something rather irritating about the thought of people making way above the median income living rent free in La Jolla, when many others living in far less desirable areas somehow manage to scrape up the monthly.

            Must be extremely irritating if you are the ones not receiving the contractually agreed rental payments. These days it seems like rental agreements are not worth the paper they are written on.

          2. From what I understand, the papers preserve the right of the landlord to collect back rent. Below a certain income, only a signed affidavit is required. Above that income, documentation and an affidavit are required. The husband was falling behind on rent before the shutdown and has been a d-bag trying every which way to get out of their contractual obligation. He was asking about what, if any, forgiveness the landlords were getting (none) and if the landlords would agree to halve the rent. They already pay below market because the house is dated. The wife handles criminal drug cases. We’re not sure if good credit is required of the position but it would make sense so that she’s not a bribery target.

            My husband has another tenant who lost her significant other after both of their jobs were impacted by the shutdowns. She’s been far more cooperative and forthcoming.

            My husband gets paid on rent collected so it’s not just irksome for the landlords.

          1. isn’t CA requiring credit reports for non-payment of rent to be scrubbed. There is no downside to not paying rent, only upside.

      3. “The wife is an assistant district attorney making something like $225K/yr.”

        Can a legal professional representing the county get away with collection activities and a poor FICO score on their credit report?

        1. My husband has been wondering about that. If I were her and my husband pulled this, he’d get the boot.

        2. Tons of cops have crappy credit — doesn’t matter — but if they get a domestic violence conviction and can’t carry a gun they’re toast.

          1. Your post aroused my interest so I went searching and ran across this …

            1117. Restrictions on the Possession of Firearms by Individuals Convicted of a Misdemeanor Crime of Domestic Violence | JM | Department of Justice
            https://www.justice.gov/archives/jm/criminal-resource-manual-1117-restrictions-possession-firearms-individuals-convicted

            (here is an interesting snip)

            “There is no law enforcement exception: One of the provisions of this new statute removed the exemption that 18 U.S.C. § 925(a)(1) provided to police and military. Thus, as of the effective date, any member of the military or any police officer who has a qualifying misdemeanor conviction is no longer able to possess a firearm, even while on duty. We now have the anomalous situation that 18 U.S.C. § 925(a)(1) still exempts felony convictions for these two groups. Thus if a police officer is convicted of murdering his/her spouse or has a protection order placed against them, they may, under federal law, still be able to possess a service revolver while on duty, whereas if they are convicted of a qualifying misdemeanor they are prohibited from possessing any firearm or ammunition at any time. Currently pending before Congress are at least two bills that would substantially modify the impact of the amendment to this section.”

  6. ‘Anti-police protesters turned to violence in Seattle as they damaged property and clashed with law enforcement on Saturday night. Sixteen were arrested. The group marched through part of downtown after gathering at Cal Anderson Park as they chanted “black lives matter” and “no walls, no prisons, total abolition.”

    ‘Some members of the crowd committed acts of vandalism and property damage, the Seattle Police Department said in an incident summary, including shattering windows at a coffee shop. They threw explosives inside as well. Video footage showed about a dozen people striking windows at a Starbucks. Several windows broke.’

    ‘A portion of the crowd stopped on a sidewalk downtown and shouted at diners eating inside a restaurant. It wasn’t clear what they were saying. Rioters continued harassing people filming, claiming they were endangering them by recording what was unfolding. “I’ll break your jaw, bro,” one man told an independent journalist who had been filming.’

    “As a black person, man, I’m feeling really weird about you standing back recording people,” another man told a live streamer. “One, please go to take yourself over there and start recording the [expletive] pigs, or two, leave. Three, I can do my choice, but you’re not going to like that.”

    https://www.theepochtimes.com/anti-police-protest-turns-violent-in-seattle_3525170.html

    Annnd it was mostly peaceful.

    1. B…b…but during the debate with Trump, Joe Biden said Antifa was just an idea. I’m trying to wrap my head around how an idea can throw a rock or Molotov cocktail.

      Latest slogan on signs carried by these collectivist Red Guards: “If you’re not Antifa, you’re fascist.” Got it.

      Comrade Biden, you’re on crack if you think I’m giving up my means to defend myself, my family, my property, and my neighborhood against the DNC’s Red Guard auxiliaries.

      1. (Caveat: Once I retrieve my AR-15 and ammo from the murky depths where I lost them following my recent unfortunate boating accident.)

      2. I’m trying to wrap my head around how an idea can throw a rock or Molotov cocktail.

        All those fires were spontaneous combustion, and not arson.

        #KnowYourNarrative

          1. And all the city fires are his fault too.

            Flames are orange. Orange man bad.

            The prosecution rests.

          2. Just saw the new video. DJT was a little breathless yesterday but his speech was more normal today. However, I still want to give it a week.

    2. There is a certain narrative that is being pushed by all sides. Take this article.

      https://nypost.com/2020/10/03/serial-robbers-have-been-wreaking-havoc-on-nyc-this-year/

      “Serial robbers have been wrecking havoc on NYC this year.”

      After a whole article about the havoc we get the last sentence, which I’ll credit the Post for even including. “Robberies in the city are about level for the last two years, with 8,804 reported through Sept. 13 compared to 8,850 the same period last year.”

      It has gotten to the point where I don’t believe anything but my own eyes. We had two nights of organized looting of high-end stores by gangs around June 1, while the police were too busy harassing peaceful George Floyd protesters to stop them. Nothing since. Here is a video — by a guy you put me on to — from the end of June showing what it’s actually like to be in NYC (Manhattan, where he works, and Brooklyn, where he lives) right now.

      https://www.youtube.com/watch?v=emQ3bUlqXQg

      I find him to be a very smart guy about what is happening generally, outside his area of expertise, and I like his NYC attitude.

      1. Looting most likely doesn’t count as robbery. If the stores were closed, no employees present, and nothing is taken by force or threat of force from the body or presence of a non-participant (i.e. store clerk or owner) its the lesser crimes of vandalism and burglary.

        1. Looting as historically been dealt with by issuing shoot-to-kill orders to security forces. That tends to halt the practice and put the scum in check rather quickly, as well as putting the rest of the riffraff on notice that there are certain things society and the authorities won’t put up with.

          Unless, of course, the authorities are collectivist fellow travelers. Then BLM-Antifa rent-a-mobs are free to loot and maraud with impunity.

          1. “Thinking the Constitution might have something to say about summary execution orders.”

            From Wikipedia, the Chicago riots of 1968 …

            (a snip)

            “Approximately 10,500 police were sent in, and by April 6, more than 6,700 Illinois National Guard troops had arrived in Chicago with 5,000 soldiers from the 1st Armored and 5th Infantry Divisions being ordered into the city by President Johnson. The general in charge declared that no one was allowed to have gatherings in the riot areas and authorized the use of tear gas. Mayor Richard J. Daley gave police the authority ‘to shoot to kill any arsonist or anyone with a Molotov cocktail in his hand … and … to shoot to maim or cripple anyone looting any stores in our city.'”

            https://en.m.wikipedia.org/wiki/1968_Chicago_riots

    3. I see Zachary Stieber and the Epoch Times didn’t get the recent memo that was sent out to real journalists.

      AP Stylebook: Avoid Using Word ‘Riot’ Because It ‘Stigmatizes’ Protesters

      By Tré Goins-Phillips
      October 1, 2020

      The Associated Press Stylebook is encouraging journalists to set aside the word “riot” when describing the protests that have often descended into violent upheavals, arguing the word “stigmatizes” protesters and the Black Lives Matter cause.

      The AP Stylebook, an instruction manual for journalists, issued the guidance Tuesday after months of protesting, rioting, and looting across the country.

      Instead, AP reasoned, media members should use milder terms with less violent connotations when referencing the often violent exhibitions unfolding in major American cities.

      “Unrest is a vaguer, milder and less emotional term for a condition of angry discontent and protest verging on revolt,” AP suggested.

      The media company went on to explain the words “protest” and demonstration” refer to “specific actions such as marches, sit-ins, rallies or other actions meant to register dissent,” which can be “legal or illegal, organized or spontaneous, peaceful or violent, and involve any number of people.”

      “‘Revolt’ and ‘uprising’ both suggest a broader political dimension or civil upheavals, a sustained period of protests or unrest against powerful groups or governing systems,” it added.

      The AP Stylebook has also encouraged journalists to “limit use” of the word “looting,” which it suggested is a racially charged word. The impetus for that shift was a censored tweet from President Donald Trump, who, in the wake of the uprisings following the police-involved death of George Floyd in May, wrote, “When the looting starts, the shooting starts.”

      “Some have long viewed the word [looting] as carrying some racial overtones, particularly in the wake of natural disasters,” explained AP. “[I]nstead, use a few more words and describe the actions: ‘Some protesters broke into the store and stole whatever was on the shelves,’ for example.”

      https://www.faithwire.com/2020/10/01/ap-stylebook-avoid-using-word-riot-because-it-stigmatizes-protesters/

      1. “Don’t you see that the whole aim of Newspeak is to narrow the range of thought? In the end we shall make thought-crime literally impossible, because there will be no words in which to express it. Every concept that can ever be needed will be expressed by eactly one word, with its meaning rigidly defined and all its subsidiary meanings rubbed out and forgotten. . . . The process will still be continuing long after you and I are dead. Every year fewer and fewer words, and the range of consciousness always a little smaller. Even now, of course, there’s no reason or excuse for commiting thought-crime. It’s merely a question of self-discipline, reality-control. But in the end there won’t be any need even for that. . . . Has it ever occcured to you, Winston, that by the year 2050, at the very latest, not a single human being will be alive who could understand such a conversation as we are having now?”

        ― George Orwell, 1984

      2. I mentioned before that when AP started injecting first person political opinions into their articles, it was a big deal.

        ‘encouraged journalists to “limit use” of the word “looting”

        Encouraged means if you want to get paid, tow our line.

        1. If you want an example of biased “reporting,” check out today’s AP article on Trump briefly going outside the hospital to greet some well-wishers is not even journalism. It was basically a hit piece on how Walter Reed was confusing and obfuscating. AP even went out of their way to find a couple Trump-hating doctors. The only legit criticism is that Trump might have exposed some people in his motorcade.

          1. Trump might have exposed some people in his motorcade.

            OK, check that. Another news article has a photo of DJT in his limo wearing a mask. So AP can suck it.

  7. “HubHaus, a venture-backed startup in the burgeoning new field of ‘dorms for grownups,’ has imploded, stranding hundreds of renters and homeowners, mainly in the Bay Area.

    It’s time for the old “F**kedCompany.com” to make a comeback. While the MSM touts and shills were cheerleading tech bubble 1.0 circa 1999, Pud, the hilarious truth-teller who ran FC, was skewering all these bubble companies and making the case for why they were f**ked, especially their cash burn rates. He was kind of the Ben Jones of the Tech Bubble, though he was a lot more snarky and over-the-top hilarious. All these cutesy-named “unicorns” and start-ups with ludicrous business models and even more ludicrous valuations, which never could’ve existed without a tsunami of Yellen Bux, are toast. Watching their implosion, which is going to culminate in the implosion of the Fed’s Everything Bubble, is going to be glorious.

  8. In CA right next to UC Davis was the apartment complex WestVillage
    which sold to the University in the last year or two. I was there a month ago and saw WestVillage is doubling in size. Well don’t worry all the CA Taxpayers have your back.

  9. ‘Similar to everyone else (who runs corporate group homes), in the middle of March, we saw 40% of our revenue disappear in a matter of five days,’ she said, as renters who were now working from home left the city.

    Is that a lot?

  10. Now he’s looking to sell the property and the development rights. But Ferney isn’t saying why.”

    Um…because he’s a benevolent, kindly soul who wants to gift someone a magnificent investment opportunity?

  11. “Cherlyn Reyes is a first-time landlord. A family of five adults has been renting her West Oahu home for more than a year, but they haven’t paid their rent since June and their lease expired on Aug. 31. For now, she can’t evict that family. Reyes says she understands the need to help renters, but asks: What about landlords?”

    Another speculator dream of effortless riches crawls into the arse to expire.

      1. Filipino most likely.

        Saw a decent sized Trump caravan on the highway yesterday, led by the owner of a gun store. Some bikers, including a neighbor were “security”. Big change from 2016 where there were no Trump flags or signs save for one posted by that same neighbor.

        Whole resorts still completely shut down, be interesting to see what happens on the 15th when the quarantine goes from 14 days to 3 provided you test negative. Only reason they’re doing this now is the free fed cheese came to an end.

    1. Not a single beater waiting for free cheese. All late model vehicles, almost all of them are newer than my car.

      1. Don’t worry; they’ll be repo-ed any day now.

        https://www.marketwatch.com/story/frontline-workers-in-eye-of-pandemic-storm-for-months-now-fending-off-repo-man-11601587260?mod=home-page

        “It’s one of the issues that’s been compiling into a big crisis,” said Margarita Solorzano, executive director at the Hispanic Women’s Organization of Arkansas, a 20-year-old nonprofit in Springdale, which has provided emergency aid to families struggling to make car payments, keep up with rent and put food on the table, seven months into the the global viral outbreak.”

        “Owning a car is a must,” she said.”

        “A lot are considered essential workers,” Solorzano said of families in northwest Arkansas seeking aid from her group and others, which aim to help families hurt by the economic and public-health shocks of COVID-19, particularly where federal aid has fallen short.

        “Several auto dealerships peppered throughout the town offered initial loan extensions to borrowers facing hardships, according to Solorzano, but so-called buy-here, pay-here subprime lenders often repossess vehicles quicker than other lenders.”

        “Shahan pointed to a vicious cycle of predatory auto lending and repossessions that has been around for decades. “Now it’s on steroids,” she told MarketWatch. “People will go without food and the medicines they need to hold on to a car.”

  12. “HubHaus, a venture-backed startup in the burgeoning new field of ‘dorms for grownups,’ has imploded, stranding hundreds of renters and homeowners, mainly in the Bay Area.”

    Another dumb and utterly useless business model, which was only brought into existence due to a plethora of Bernanke-Yellen-Powell bux, just bit the dust.

    1. They probably could have played it out for a few more years and secured more funding, if covid hadn’t hit. The end of ‘cramming people into a city they don’t need to be in’ was gonna come sooner or later.

  13. How an “Act of God” Pandemic Is Destroying the West

    Rising real estate arrears prompt a mortgage bailout

    Canada and many European governments are subsidizing businesses to pay up to 80 percent of employee wages even though many must stay home. But for the 40 million Americans who haven’t been employed during the closedown, the prospect is for homelessness and desperation. Already before the crisis about half of Americans reported that they were living paycheck to paycheck and could not raise $400 in an emergency. When the paychecks stopped, rents could not be paid, nor could other normal monthly living expenses.

    America is seeing the end of the home ownership boom that endowed its middle class with property steadily rising in price. For buyers, the price was rising mortgage debt, as bank credit was the major factor in raising property prices. (A home is worth however much a bank will lend against it.) For non-whites, to be sure, neighborhoods were redlined against racial minorities. By the early 2000s, banks began to make loans to black and Hispanic buyers, but usually at extortionately high interest rates and stiffer debt terms. America’s white home buyers now face a fate similar to that which they have long imposed on minorities: Debt-inflated purchase prices for homes so high that they leave buyers strapped by mortgage and compulsory insurance payments, with declining public services in their neighborhoods.

    When mortgages can’t be paid, foreclosures follow. That causes declines in the proportion of Americans that own their own homes. That home ownership rate already had dropped from about 58 percent in 2008 to about 51 percent at the start of 2020. Since the 2008 mortgage-fraud crisis and President Obama’s mass foreclosure program that hit minorities and low-income buyers especially hard, a more landlord-ridden economy has emerged as a result of foreclosed properties and companies bought by speculators and vast absentee-owner companies like Blackstone.

    https://www.unz.com/mhudson/how-an-act-of-god-pandemic-is-destroying-the-west/

    1. He’s another communist:

      ‘Professor Hudson: Well, my point is that there’s some kind of contracts that shouldn’t be upheld.’

      https://www.unz.com/mhudson/my-debate-with-a-harvard-cato-institute-ideologue-about-capitalism/

      More free sh$tism.

      How a debt jubilee could help the U.S. avert economic depression

      https://www.marketplace.org/2020/04/02/covid-19-debt-jubilee-forgiveness-easing/

      Long ago I could see these communists hiding behind the “bankers are evil” thing.

      1. The author makes some valid points, though I don’t agree with his prescription for how to fix things.

        By injecting $10 trillion into the financial markets (when Federal Reserve credit is added to U.S. Treasury allocation), the CARES act enabled the stock market to recover all of its 34 percent drop (as measured by the S&P 500 stocks) by June 9, even as the economy’s GDP was still plunging. The government’s new money creation was not spent to revive the real economy of production and consumption, but at least the financial One Percent was saved from loss. It was as if prosperity and living standards would somehow return to normal in a V-shaped recovery.

        But what is “normal” these days? For 95 percent of the population, their share of GDP already had been falling ever since the Obama Depression began with the bank bailout in 2009, leaving an enormous bad-debt overhead in place. The economy’s long upswing since World War II was already grinding to an end as it struggled to carry its debt burden, rising housing costs, health care and related monthly “nut.”

    2. By the early 2000s, banks began to make loans to black and Hispanic buyers, but usually at extortionately high interest rates and stiffer debt terms.

      Odd, when I got pre-approved the banker didn’t see my skin color, just my bank records, FICO, and current debt. Curious how these rayciss bankers discern a person’s color from a spreadsheet printout.

      Unless it’s an issue with income, FICO, and current debt obligations…

      1. the early 2000s, banks began to make loans to black and Hispanic

        None of whom could get a loan in 1990? My experience is to the contrary.

        1. Perhaps what they meant to say was that before the early 2000s, lenders were not legally allowed to take race into consideration when deciding who qualified for mortgage loans. Thereafter it became a legal requirement to relax lending standards for government-favored racial groups, giving the members of these groups a race-based advantage in qualifying for mortgages.

          Does this sound accurate?

    1. I would appreciate it if you would identify the videos like this:

      WE LOST 135K IN ONE DAY – And Our Dream RV – Don’t Let This Happen To You
      •Sep 7, 2020

        1. Wow, Jeremiah Babe is now concerned about Californians metastasizing other states, ruining the country!

    2. I watched 10 minutes of that video and although I feel bad for the couple, they claimed to have a brother in-law who is a lawyer, neighbors who work in the mortgage industry and failed to ask some what I consider very necessary questions about what they were signing up for and doing with their finances.

      Do you get to stop making mortgage payments while you are going through the refinance process?

      Our mortgage company told us that do to coronavirus we automatically get a forbearance and we don’t have to do anything or make any payments. Is that true?

      I don’t have easy access to the financial professionals this couple claims to have but I did have an old man who gave me what I have come to know over the course of my life was good advice on many subjects including this one.

      If it sounds too good to be true, it is.

      PS

      He never put probably in there.

      1. This was for Bob’s

        WE LOST 135K IN ONE DAY – And Our Dream RV – Don’t Let This Happen To You
        •Sep 7, 2020

        video

  14. i finished signing the closing paperwork for a refinance of. y condo i purchased in 2011.

    Chit chatting with the notary i asked her if she was busy. As expected she is driving all over So Cal to get closing signatures.

    What really surprised me was the confusion when I was paying my closing costs in cash and not rolling into the loan. She doesn’t didn’t know what to do. She said no o e does this, everyone just tacks it i to the loan. Very eye opening. She did t understand why I would want to do that or pay off the loan as quickly as possible or that I even had $3500 available to do it. I guess being a buyer at the 2011 bottom and staying out of the rat race in housing affords me much more extra cash that other CA households just don’t have. Now I’m a renter during Covid and even after paying cash for a boat and slip fees in Dana Point I still have too much money to throw away 😀

    1. Congrats for timing your financial moves in perfect opposition to the collective movements of the lemmings herd.

    2. You “own” a condo and are renting an apartment? So, the condo is an “investment”?

      I’ve never arranged a loan simply organized by a traveling notary. Interesting.

      Odd.

      1. Well…. when it comes to housing, here’s what we know. There’s fraud, misrepresentation and flat out lies.

      2. I’ve never arranged a loan simply organized by a traveling notary. Interesting.

        From what I have heard this is the new normal. No more going to a title company to sign the piles of documents. Also, I have heard that many docs can now be esigned.

        Brave new world

      3. it’s even more bizarre, no appraisal needed. It’s all sign them up, close them and sell to Fannie Mae.

        Needed another room two of us working from home while our offices closed .

  15. Oh dear….

    Manhattan Homebuying Market Echoes 2009 With Supply Pileup

    For Manhattan home sales, it’s beginning to look a lot like 2009.

    Unsold listings in the third quarter surged to 9,319, a level not seen since the midst of the global financial crisis 11 years ago. It would take 20.3 months to clear all the available inventory, the longest stretch since 2009 as well, a report by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate shows.

    Closed sales are still happening at a snail’s pace. For deals that were completed, average buyer discounts were the highest in a decade.

    https://www.bloomberg.com/news/articles/2020-10-02/manhattan-homebuying-market-echoes-2009-with-inventory-pileup?srnd=wealth&sref=ibr3A0ff

  16. The Plunge Protection Team is frontrunning tomorrow’s market opening by driving up stock market index futures, as a precaution against outsized dislocation due to the shocking news of the President’s hospitalization.

    1. I thought the futures were reflecting that the President seems to be recovering, which may prompt Congress to pass another stimulus. It’s all about the stimulus.

  17. ‘I saw the bright yellow signs last week as I was driving down a major thoroughfare in town. I pulled into the shopping center and quickly found the EZ Up with the banner…to RecallGavin2020. Time to boot the tyrant in Sacramento.’

    ‘For the anticipated ballot debacle, we can “thank” Gov. Gavin Newsom, himself, who dictated that everyone on the rolls receive a ballot in the mail. His new scheme also gives county registrars many days beyond Nov. 3 not only to count ballots, but also to RECEIVE them. What could go wrong?

    California was sued over its greatly flawed and inflated voter lists, a number of which contain more than 100% of the number of eligible adults even living there. The Secretary of State fought the lawsuit (with OUR tax dollars, mind you) and lost. However, many registrars of the state’s largest counties have yet to clean up the rolls. My friend’s grown son received a postcard from L.A. County inquiring as to his voter status, but he’s registered in another county and hasn’t lived with his mom at that address in more than 12 years! Can you say Tip Of The Iceberg?

    And let’s not forget the thousands of people leaving the state each year. More than 690,000 in 2018 alone. Have they notified the county registrar of their departure? Will ballots show up for them at their California addresses? Take a guess. ‘

    ‘But back to Newsom. Has there ever been a governor who has seized as much dictatorial power?’

    https://signalscv.com/2020/10/patricia-suzanne-is-there-any-hope-for-california/

    1. The very liberals who complain about wealth inequality and call for “redistribution” have been systematically turning this state into a rich/poor dichotomy…

      Sounds like an abusive relationship.

    2. “Imagine you want to drive to Arizona to visit your family members who have managed to escape California’s massive taxes, overpriced housing, degraded public education system and burdensome business regulations. Because some bureaucrat has dictated what kind of car you can drive, guess you won’t be making that trip. After all, how would you fuel your mandated vehicle to cover such a distance?”

      LOL. The Great Reset plan won’t care about your wants. The Great Reset may not allow for you to even own a car, or own much of anything else.

  18. Marketwatch headline: “Economists Growing Less Optimistic About Outlook for US Economy.”

    You don’t say. The financial media touts and shills keep pushing the “Everything is Awesome – Buy Moar Stawks!” party line even as the real economy, as distinct from the Fed-juiced Wall Street casino, is in free-fall thanks to COVID and the disappearance of secure, living-wage jobs.

    https://www.marketwatch.com/story/economists-growing-less-optimistic-about-outlook-for-u-s-economy-11601874520?mod=bnbh

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