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Now That It’s All Gone, It’s Like, Crap, Back To Reality

A report from the Puget Sound Business Journal in Washington. “As the Graystone condominium tower on Seattle’s First Hill nears completion, fewer than 10% of the 271 homes have been sold, prompting developer Daniels Real Estate to cut prices and offer buyer incentives. On Tuesday, the Seattle-based company said it’s ‘taking the lead in the condominium comeback’ with the price reduction. A two-bedroom, two-bath condo in the upper third of the 31-story building that was originally listed for just over $1.35 million is now being offered for over $1.185 million. The price for a one-bedroom unit three floors down has been reduced 27% to $465,900. ‘Every developer is going to take a loss, so it’s a matter of getting under the market, building momentum, rewarding those who buy today,’ said Luis Borrero, vice president of brand at Daniels Real Estate.”

“The condo market, like the housing market overall, is sluggish, with April’s median sales price downtown off 11.5% year over year, according to the Northwest Multiple Listing Service. Only 40 sales closed last month, 15 fewer than April 2022. The situation is not unique to Seattle. The median sales price in downtown Bellevue last month fell 17% year over year, to $795,000. The Graystone marketing team is promoting the homes at the tower at 800 Columbia St. as the last of their kind for the foreseeable future. A half-dozen in-city condo projects in the pipeline have either been paused or converted to for-rent product. With the price cuts, prices are a third below the replacement value, according to the development team. The homes, including parking, are being delivered at around $1,030 per square foot overall. A similar new build would require at least $500 per square foot more, or about $1,530, to pencil again.”

The Colorado Springs Business Journal. “More than 1,600 new apartments became available in Colorado Springs during the first quarter of 2023. That’s a record. Vacancy is up and likely to continue climbing as more and more new apartments buildings come out of the ground. ‘That’s almost 12,000 units that have broken ground,’ says Scott Rathbun, president of Apartment Appraisers & Consultants. For scale, that will add roughly 20 percent to existing inventory of an estimated total 55,000 apartments built over the last 120 years in Colorado Springs, Rathbun says. ‘Colorado Springs is a relatively small market,’ he says. ‘When you’re adding thousands of units at a time, it can be overbuilt rather quickly.'”

“In the first quarter of this year, when Colorado Springs added 1,600 newly constructed apartments to the city’s inventory, the quarterly absorption rate was four. Essentially, demand grew by four units and supply grew by 1,600 in the quarter. If the 8,100 proposed projects were to go forward along with the 11,900 already under construction, that would add 20,000 units to an existing inventory of roughly 55,000 units. That would be a 40 percent increase in apartment inventory over the next two to four years.”

“For perspective, if the almost 12,000 units currently under construction were to be delivered evenly over the next three years, that would be 4,000 new units per year. The most the city has absorbed in a year is roughly 2,000. So, there will be at least double the number of new units the market is likely able to fill even without the additional 8,100 proposed units. ‘You’re definitely overbuilding,’ Rathbun says.”

The Real Deal. “Texas has been here before. In the late 1980s, a bygone Dallas bank called First Republic spiraled into a crisis, its books saddled with non-performing commercial real estate loans. In July 1988, First Republic failed and merged with a lender called NCNB Texas National. But in Texas commercial real estate, the bank didn’t do much lending. ‘NCNB, the acronym was ‘No Cash For Nobody,’ said Kevin Santaularia, CEO of Dallas-based Bradford Companies. Santaularia learned from the first First Republic collapse — now, as a second plays out on the national stage, lenders are again building their reserves, and commercial real estate is a no-no in credit committees. ‘Now it’s a national problem, versus a Texas problem,’ Santaularia said.”

“While the wall hasn’t collapsed in Texas yet, some cracks are starting to show. In April, Arbor Realty Trust foreclosed on a $229 million multifamily portfolio in Houston. A few companies, Santaularia’s included, have raised nine-figure funds to target distressed commercial real estate in Texas. As loans come due, particularly for certain multifamily properties and office buildings, the vultures are starting to circle. Every day their pack grows.”

“In March, Nitya Capital sold almost 500 apartments in San Antonio to Nord Group, in a deal that the broker said was the result of ‘a number of challenges,’ stemming from rising rates and tighter lending. The properties, largely built in the 1980s, represent the type of value-add multifamily property that has caught some investors with their pants down. Zachary Meyer, director of Texas multifamily sales for Rosewood Realty Group, said Nitya could soon have company. ‘Ballpark, in the next three-to-six months, we’re really going to see an uptick in distress: distressed properties and distressed sellers as people’s loans mature and they can’t refi,’ Taylor said.”

Globest on California. “The largest apartment landlord in San Francisco, Veritas Investments, is facing the loss of more than a third of its multifamily portfolio in the city as its lenders seek to offload $1B in loans that are in default. Eastdil Secured is marketing the unpaid mortgage loans, which are backed by 95 apartment buildings in San Francisco encompassing 2,452 units and 45 ground-floor commercial storefronts, the San Francisco Business Times reported.”

From NPR. “An unraveling of the office sector spells trouble not only for banks that are owed an estimated $1.2 trillion in outstanding office loan debt, but also for countless small businesses that depend on white-collar customers as well as cities that benefit from the property taxes tied to office buildings. Nearly 20% of office spaces are currently empty across the United States. It’s a milestone that exceeds the vacancy rate during the 2008 global financial crisis, and it’s worse in places like San Francisco and downtown Los Angeles, where more than a quarter of offices are sitting empty. ‘I’d say the number one implication is going to be defaults and foreclosures,’ says Kenneth Rosen, chair of real estate research firm Rosen Consulting Group.”

“Dry cleaners, shoeshiners, restaurants and conRight now I’m maybe getting four or five customers a day,’ says James Wallace Sears, owner of a shoe repair shop in downtown Los Angeles, adding that his monthly sales are down 85% from before the COVID-19 pandemic. ‘I’m here now starting up again to see if it’s still going to work, but I don’t know.’ Stores that have long depended on heavy five-day-a-week foot traffic are struggling to survive.'”

CBC News in Canada. “‘Everybody’s going to get paid.’ Those words have been spoken more than once by Greg Martel, the Victoria mortgage broker, who has been accused of running his business like a Ponzi scheme and who owes over $226 million to hundreds of people who bought investments that — according to documents — may not have actually existed. Last week at a virtual town hall for investors, PwC vice president Neil Bunker delivered sobering news to the 500 people tuning in: not only are Martel’s whereabouts uncertain, investigators have yet to locate the missing millions or proof the investments were real.”

“Single mother Gayle Morrell said she learned of Martel from a friend whose accredited financial planner recommended investing with him. Morrell said she worked hard for two years to scrape together $25,000 to invest. At first, it all seemed good. She watched her money grow to over $80,000 and had recently requested to withdraw the original deposit so she could build a free-standing roof over the RV she lives in with her son. Now she doubts she’ll ever see a penny of her money.”

“‘It was interesting how [investing] changed the way I thought about finances. I kind of thought I was in some rich boys club … I like, squeaked in, and this is how people with a lot of money make money,’ she said. ‘And now that it’s all gone, it’s like, crap, back to reality.'”

From ABC News. “When Mali Davoodi immigrated from Iran more than a decade ago, she wanted to achieve the ‘great Australian dream’ of owning her own home. But that dream has turned into a nightmare after one of the country’s largest builders Porter Davis collapsed last month. The 44-year-old and her husband are among about 1,700 victims caught up in the insolvency crisis the head of Master Builders Queensland says has been created by ‘the worst economic conditions in living memory.’ Every time it rains, the distressed couple’s unfinished home gets damaged further, because it’s not yet watertight.”

“Ms Davoodi said the ‘state of suspense’ she and her husband have been left in had been frustrating. ‘I just want to wake up and this nightmare to finish so I can have my life back,’ she said. ‘The amount of stress and pressure we are under has made this unbelievably hard. This was our first house build, we have been saving for six years and our dream home idea is shattered and the hard-working money we earned has gone.'”

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This Post Has 84 Comments

  1. Are we there yet?

    ‘Every developer is going to take a loss, so it’s a matter of getting under the market’

    That’s the spirit Luis! Undercut those bashtards that bought from you last week!!

  2. It was interesting how [investing] changed the way I thought about finances. I kind of thought I was in some rich boys club … I like, squeaked in, and this is how people with a lot of money make money’

    How right you were Gayle!

  3. ‘Colorado Springs is a relatively small market,’ he says. ‘When you’re adding thousands of units at a time, it can be overbuilt rather quickly.’”

    The build quality on most of these new apartment complexes is horrendous. Tenants who move into these overpriced units are finding all manner of corner cutting and shoddy construction.

    1. Good enough to last until the day after warranty, and not a single day more. That’s how Denver rolls.

  4. Eastdil Secured is marketing the unpaid mortgage loans, which are backed by 95 apartment buildings in San Francisco encompassing 2,452 units and 45 ground-floor commercial storefronts, the San Francisco Business Times reported.

    True price discovery is going to lay waste to CRE values in commie-ruined municipalities. Got popcorn?

    1. More commercial storefronts in SF while all the other retailers are moving out. What could go wrong?

  5. Last week at a virtual town hall for investors, PwC vice president Neil Bunker delivered sobering news to the 500 people tuning in: not only are Martel’s whereabouts uncertain, investigators have yet to locate the missing millions or proof the investments were real.”

    Must.not.laugh.

    1. Bloomberg: California’s Newsom Sees Budget Deficit Deepening to $32 Billion
      ABC NEWS: Reparations for Black Californians could top $800 billion
      i think the $32 Billion deficit is too optimistic (I believe it was previously forecast at $22 B) as the CRE crater and working people leaving is “gonna”. crush tax revenue. Can’t even imagine where the $800B is going to come from for repatriations. Revoke property tax Proposition 13??
      If only 43.5% own there shacks.. maybe

        2. Didn’t Newsom backpedal on the reparations given the budget deficit?
          He did but I doubt “expectations/demands” for it won’t go away quietly.
          It will be interesting to watch.
          Good luck giving all those illegals welfare.

      2. Revoke property tax Proposition 13??

        I suppose if the reparations were paid out in installments over many years, repealing prop 13 could fund it. But the expectation is a million dollar check. $50K a year for 20 years might not cut it with the recipients. A normal person would happily take it, but you can’t live large with $50K a year: no benzes, no bling, etc. Just some Air Jordans, hookers and blow, and maybe a Kia Soul.

        1. Investing 50k per year over 20 years would yield a lot, but then again, people demanding reparations as reasonable policy probably aren’t the best at delayed gratification and building things.

        2. …A normal person would happily take it, but you can’t live large with $50K a year…”

          This reparations concept / proposal is so outrageous that’s its hard to find words to describe it, printable or not.

          So lets be fair:

          So here am I, a white guy who has worked non-stop 50+ years, paid a ton of taxes, for quite a few slave driving employers.

          So where are *my* ‘reparations’ for putting up with all the BS and nonsense for the last 50 years? Is the concept any different?

          1. they never ever talk about black people who owned at least13,000 slaves or the american indians which Lincoln proclamation did not apply to indian territories they had to end slavery tribe by tribe.

          2. black people who owned at least13,000 slaves
            Also, white people were slaves as well. They were slaves in Florida when the Spanish were running the area.

          3. Let’s not forget the hundreds of thousands of men who gave their lives to settle the matter. Do we get a discount for that?

            Anyway, it’s an absurd demand and little can be done to overcome absurdity with polite logic.

    2. What’s really interesting is to look at the trend line for ‘free and clear owner ship’ which is taking a dive.

      Are people selling to greater fools and moving out of California?, HELOC’s to cover ever rising California cost of living?, death of original homeowners?, …?

      1. In the US, the free-and-clear rate was 26% in 2020.
        In 2023 was 23% — already a significant drop.

        Free-and-clear rate in the US is low because mortgages are long-length, and the low interest rates incentivized owners to re-start the 30-year clock when they refi’d. Few people are paying off the mortgage.
        Under the current interest rate environment, I believe that the free-and-clear rate will drop even more as elderly Silent and Boomer generation women finally go to nursing home or die off, converting a free-and-clear house to a mortgaged house.

        Free-and-clear rates are low in Scandinavia because there are huge tax breaks if you have a mortgage.

        On the other hand, free-and-clear rates are very high in the Central and Eastern Europe. When those countries ended socialism or broke from the USSR, the government allowed renters to buy their house outright for a song. And I guess they are passing those houses down to kids and grandkids.

        Sources:
        https://www.forbes.com/sites/johnwake/2023/03/31/us-has-3rd-lowest-percentage-of-households-that-own-their-homes-without-mortgages/?sh=3e2aff473124

        https://www.compareyourcountry.org/housing/en/0/all/default

        1. When those countries ended socialism or broke from the USSR, the government allowed renters to buy their house outright for a song.

          I have several relatives in Hungary who did just that. Their incomes are low, but many have a house that is mortgage free. The younger generation there missed the boat. While their real estate is much cheaper than ours, at least outside Budapest, they also have had a bubble and they can’t afford anything.

          When we were in Czechia our tourist guide bragged about how she got her flat for next to nothing. Her adult kids won’t get that deal.

          1. Well, I’m very well acquainted with the situation. Let’s explain what really happened and how those central Europeans got their homes for a song. Yes, they were were cheap compared to today’s prices but so were the wages. How about making a staggering 100$ a month. Would that still be cheap to buy something that would cost you 20 years of your life? I doubt it.

            But how it really unrevealed is as follows. After a lifetime of paying high taxes that were used to build those homes, the government allowed the “renter” taxpayer, and the guys who participated to building the wealth of those countries buy the homes they lived in. Now, don’t forget, they didn’t have(yet) a class of financiers, banksters, corrupt government, greedy developers, etc. It was assumed that all the wealth of that country belonged to the people who built it.

            When the entire economy got privatized, the guys renting for very small fee from the government were assumed to have a right and stake in those homes. It was their hard work that build anything in those countries. There wasn’t an elite class( at least not economic elite) to own everything in those countries. They didn’t have the 1% class yet.
            So, fair and square prices were set which were amounting to about 15-20 years of a regular mortgage. BUT, by the time people started to make the payments, the inflation was running 100%-500% a year. But the contract price was set in stone. So, if you waited 2-4 years, you could have payed it off for pennies on the dollar, which the vast majority did.

            And that’s the story on how many part time communist owners who worked a lifetime to build something in common ended up being capitalist owners of the places they lived in a lifetime.
            On the other hand, the well connected, the political elites, were made multi millionaires by buying entire industries the same way.

            I and I know it as a fact. I worked in one of the countries on an European funded development project, and I heard it first hand from the people I worked with. It’s 100% accurate.

          2. And I’m adding one more. There is no country I know of (among the more civilized ones) where people suffer more under the weight of property taxes, mortgage payments, and the associated stress than in the mighty USA. But I’m willing to learn if anyone can give me some examples.

          3. the weight of property taxes

            Especially this. Even in “low tax” states it is onerous when compared to other countries; though most of them have 20%+ VATs (27% in Hungary!)

          4. Thank you for the insight… I only know the one little paragraph that I read. Yes, it was a privatization effort.

            I don’t think the US is the worst for tax burden. Australia, Canada, and the UK seem worse for mortgages, because all the mortgages are really adjustable rate, i.e. “fixed” for five years and then you get screwed. And I thought that Scandinavia and Canada took higher taxes. In the US, taxes are high, but there are ways to minimize taxes. You can move to a low-tax state, deliberately make a low income, or own a cheap house. This is how retired senior citizens are still able to live without burdening the kids.

          5. @In Colorado.

            True, but there is a massive approach difference. VAT and income tax are payed only if you want to purchase something or work. It’s your choice. With income tax, you work, you have the money, you pay. You don’t work, you get some help, and stay put in your house with almost no property tax. Nobody makes you leave your home and live in a tent because you don’t have the money anymore.
            I don’t want to speak for every country, but one of my property, sort of vacation luxury little thing, because is considered something I don’t need, and shouldn’t have, is taxed at an staggering 600 Euro a year and they feel they are punishing me very hard for having the impunity of owning it.

            In USA, oh my G! You work, good, you fall on some hard times, good luck! Have the money or not, you still need to come up with incredible high property tax compared to the rest of the planet.
            And yes, I know, schools, improvements, infrastructure, fire district, etc, but trust me, USA is not the only country providing those services. Some provide them tons better and are using the regular taxes. You know, you work, you have the money, you pay. You are unemployed, nobody is asking you to sell your home and move under the bridge.

            And then again, very few Europeans treat or view their homes as some sort of investment, etc. It’s a place you live for most of your life, maybe from your parents, then leave it to the kids. Yes, they sell their homes when needed, move on, buy something else. They rent, too, but rents are mostly very well regulated, price caps, a lot of renter rights. No big business for landlords. But people get by with a lot les stress. Nobody is trying to get rich. Nobody can get rich either, so they focus on quality of life: good education, good vacations, healthy family, and everything that makes someone happy.

            Not sure what’s better. US or Europe. There are things going for both, but definitely less focus on money in Europe, and more on the real values. They even say, “Gentlemen don’t talk about money”. And money is not everything. It’s your position in society, your profession, you status. People know you, they knew you father, and grandpa. You don’t really need to make up stories to impress anyone. They know who you are. Your prestige and reputation counts. Less focus on power point presentations and made up story, on salesmanship. Actually, salesmanship is considered really low class. In USA, it rules!

            On the other hand, if money is you primary focus, willing to work as hard as you can, and ambitious you are, invent you own past and future, make it up for good or bad, even in current conditions, there is no place as USA!!

  9. So. does anyone have a thinking cap and can build nice average apartments for under $300 sq ft. for the rest of us who just don’t care about luxury finishes, or gym rooms stainless appliances but would rather have a nice porch to sit on and not a balcony you barely can fit 2 chairs on let alone a lounge chair……oh yes how about a kitchen you can put a kitchen table in not just for 2 people, like they built 60 years ago….. so you can have guests over, and a large sink. not the ones that look like. a hotel room sink………im showing my age

    —————————
    The homes, including parking, are being delivered at around $1,030 per square foot overall. A similar new build would require at least $500 per square foot more, or about $1,530, to pencil again.”

    1. Yes, you can find houses like that for even half that price. But not if you want to still be “aNYCdj.” 🙄

  10. A reader sent these in:

    We just underwrote a building in Chicago. 2019 EOY NOI $28m. Current in-place NOI $7.9. Building value in 2019 $500m. Today $79m. There’s losses on books that are monumental and no one is talking about it….

    https://twitter.com/ReelEstateDude/status/1658156858593488905

    CMBS issuance is down -85% from last year to its lowest in over a decade: DB

    https://twitter.com/ericwallerstein/status/1658153881417789459

    “Tenants leaving their current space or downsizing due to hybrid work or recent layoffs added 1.5 million square feet of sublease space in downtown Chicago in the first three months of the year @CBRE
    data show. That’s enough space to house about 15,000 to 20,000 people.”

    https://twitter.com/DiMartinoBooth/status/1658152460878245890

    Huge drop in May Empire Manufacturing Index, down to -31.8 vs. -3.9 est. & +10.8 in prior month; new orders sank to lowest since January; prices paid ticked higher, average workweek moved up (but still contracting), and employment also ticked higher (still contracting)

    https://twitter.com/LizAnnSonders/status/1658092191682625537

    Proportion of unprofitable companies among small caps is staggering. 45% of all R2K Growth companies are unprofitable and that’s before margins crack. Highest proportion ever recorded since 90 was just 10 pp higher and the average below 30%

    https://twitter.com/INArteCarloDoss/status/1658207987155042304

    HD 🚩🚩🚩🚩🚩🚩

    https://twitter.com/INArteCarloDoss/status/1658437705393471492

    Jim remains undefeated

    https://twitter.com/CramerTracker/status/1658458819737821185

    Home Depot sales fell 4% over the last year, the largest YoY decline since 2009.

    https://twitter.com/charliebilello/status/1658456401201491975

    Just talked with a friend who has a Bitcoin fund. It’s small about $100m. He told me he’s in 100% cash. Cash as in dollars.

    https://twitter.com/TommyThornton/status/1658283794850349056

    US Delinquency Rates by Category:
    1. Credit Cards: 4.6%
    2. Auto Loans: 2.4%
    3. Student Loans: 0.9%
    4. Mortgage Debt: 0.6%
    5. Home Equity: 0.5%
    6. Other: 4.4%
    Currently, 2.6% of outstanding debt is in some stage of delinquency.
    ALL of these categories are up sharply over the last year except student loan debt. However, this summer payments on student loans will resume for the first time since the pandemic. Student loan debt will further the debt crisis.

    https://twitter.com/KobeissiLetter/status/1658456674640752641

    Lumber futures are at their lowest levels since May 2020, down 81% from the peak in May 2021.

    https://twitter.com/charliebilello/status/1658127089428492296

    lolololol 💥💥💥💥💥💥💥

    https://twitter.com/INArteCarloDoss/status/1658586152662622208

    “ThIs tiMe is DiffErent”

    https://twitter.com/GRomePow/status/1658693246275719168

    Santa Monica vacancy rate 10%

    https://twitter.com/GRomePow/status/1658689663715147777

    It was only 8 1/2 years ago I sold a house to a young couple, first-time buyers, both working at Tim Hortons, and could afford a starter home in my city. Those were normal times and was the same for decades before.

    https://twitter.com/JonFlynnREstats/status/1658580969278914561

    Imagine what this looks like when the jobs recession starts

    https://twitter.com/GRomePow/status/1658684278836953089

    *Higher rates + soaring prices have squeezed out any enthusiasm for potential homeowners
    Besides the housing shortage (there’s a lot of new homes coming online though), either rates have to plunge or prices have to plunge
    Otherwise this squeeze will worsen
    Inequality widening

    https://twitter.com/RadicalAdem/status/1658630861351440384

    1. “payments on student loans will resume for the first time since the pandemic”

      Was that Masters Degree in Obama Studies really worth $80,000?

      2. The Obama degree is a bonus, but partying with co-eds for 5 years is money well spent. You may not have to pay the loan, that’s Amerikkan dream come true.

    2. Proportion of unprofitable companies among small caps is staggering. 45% of all R2K Growth companies are unprofitable

      And 65% of Russell 2000 firms are growth, meaning that at least 30% of the Russell 2000 is unprofitable, and probably higher as surely some value stock companies are also unprofitable zombies.

  11. “It was interesting how [investing] changed the way I thought about finances. I kind of thought I was in some rich boys club … I like, squeaked in, and this is how people with a lot of money make money,’ she said. ‘And now that it’s all gone, it’s like, crap, back to reality.’”

    —-

    https://www.youtube.com/watch?v=-DT7bX-B1Mg
    And it’s gone (original)
    Hubert Farnsworth
    8.9M views
    South Park episode Margaritaville; season 13 episode 3

    1. She watched her money grow to over $80,000 and had recently requested to withdraw the original deposit so she could build a free-standing roof over the RV she lives in with her son.

      And to think that not too long ago 80 grand could buy you a house, as opposed to a carport.

      1. She wanted the original $25K back, not $80K. But still, 25K AUD (~$16,666K US) is a lot for a metal roof.

        1. Fair enough, she only wanted $25K AUD back. But that does seem like a lot for a carport. Those things must be manufactured,

          I just did a quick google search. They can be purchased for about 3 grand in the US, plus installation. I know everything costs a lot more in Oz, what with the VAT (18%), exchange rates, and over regulation, but 25K AUD seems a bit much, unless she had other expenditures in mind.

        2. But still, 25K AUD (~$16,666K US) is a lot for a metal roof.

          You haven’t priced metal roofs lately I’m guessing? It would have been $80k for standing seam roof on our house. $55k for 5v.

          1. As I said, I googled manufactured carports. Don’t know what the roofs are, probably not metal, perhaps fiberglass.

          2. I paid around $5K for a pitched metal roof and gutters covering 1000 ft2 10 years ago. Included removal of asphalt elephant ear shingles, underlying cedar shingles and some carpentry. Would that be more than double today?

  12. “After contending with high inflation for over a year, households are nearing a “breaking point,” according to a study by WalletHub.

    Using the Great Recession as a guide, the projected breaking point is the level of household credit card debt that will become unsustainable for most people, said Jill Gonzalez, an analyst at WalletHub. Currently, the average household’s credit card balance is $9,990, just $2,015 shy of where that tab hits its limit, the report found.

    “It’s when people won’t be able to keep up with their bills,” she said. “We’re inching closer and closer to that breaking point.”

    https://www.cnbc.com/2023/05/17/households-are-hitting-their-own-debt-ceiling-how-to-avoid-default.html

    “This sucker could go down” — George W. Bush

    1. the average household’s credit card balance

      What stands out to me is that there is no “average” household. Are 40% of households already past this supposed breaking limit? If so, very rough times are upon us.

    2. “Americans are watching the government pile up an almost insurmountable amount of debt and they’re thinking, ‘Why don’t I do the same?’”

      Well, for one thing, the CC companies charge 20%+ interest.

      1. Run it up and file Chapter 7. Use it to pay for everyday costs. Use cash to buy gold and silver

      2. “Well, for one thing, the CC companies charge 20%+ interest.”

        Once you miss a payment the “Universal Default Clause” kicks-in, and all of your revolving debt adjusts to higher interest rates.

    3. Currently, the average household’s credit card balance is $9,990, just $2,015 shy of where that tab hits its limit, the report found.

      Let me guess, the government will suspend payments on those, too….

      1. Let me guess, the government will suspend payments on those, too….

        At this point, anything is possible.

    1. Yahoo
      Business Insider
      US home prices could plunge with mortgage rates topping 7% if a debt default even appears likely, Moody’s chief economist says
      Zahra Tayeb
      Mon, May 15, 2023 at 4:42 PM PDT·2 min read
      US home prices could plunge with mortgage rates topping 7% if a debt default even appears likely, Moody’s chief economist says
      US house prices
      US mortgage rates could surge past 7% even if a debt default appears likely, Moody’s Mark Zandi said.Saul Loeb/Getty Images

      – The housing market will come under stress if the US even appears to be headed for a debt default, Moody’s Mark Zandi said.

      – Home prices would slide and the the 30-year mortgage rate could surge past 7%, he said.

      – Fears of a US debt default are rising with politicians locked an impasse over the government’s borrowing limit.

      US home prices will suffer a steep drop, while mortgage rates shoot back above 7%, if the US Treasury defaults on its debt – or even appears like it might, according to Moody’s chief economist.
      …
      https://finance.yahoo.com/news/us-home-prices-could-plunge-234202675.html

      1. I quite honestly don’t follow Mr. Zandi’s logic. Mortgage rates are already near 7%, prices have been falling since May 2022, listings are limited, and sales are subdued. And the fear factor may drive investors into long term Treasuries, driving yields lower, with mortgage rates going down as a result.

        It seems like he is employing a scare tactic with no supporting rationale.

    1. Government
      Population decrease and housing increase drive local vacancy rate to 10%
      Avatar photo by Matthew Hall May 16, 2023

      Overview:

      Santa Monica’s total vacancy rate, including single family homes and multi-unit housing could be as high as 10 percent according to new data released by the State of California’s Department of Finance this week.

      Santa Monica’s total vacancy rate, including single family homes and multi-unit housing could be as high as 10 percent according to new data released by the State of California’s Department of Finance this week.

      According to the State, Santa Monica’s 2023 population was 91,720 with a total of 53,422 housing units for an average household size of about 1.86. Of those units 47,941 are occupied for a vacancy rate of 10.3 percent. Of the total housing units, the Department of Finance figures report 11,700 are “single” units, 194 are mobile homes with the rest in multi-unit properties.

      Santa Monica’s vacancy rate is driven in part by the local expression of a statewide trend: declining population and increased construction. The local population declined by about 1,600 people in the past three years while the city built 793 housing units.

      In the past year, Santa Monica’s population was essentially stable with just 19 people leaving the city. Santa Monica was one of 356 cities to lose population while 125 gained population and one had no change.

      Across the state, pandemic era trends of population decline also slowed with California reporting a 0.35-percent population decline for 2022, roughly 138,400 persons (down from about half a percent).

      According to the State, stable births, fewer deaths, and a rebound in foreign immigration slowed California’s population decline in 2022, with the state’s population estimated at 38,940,231 people as of January 1, 2023. Over the same period, statewide housing growth increased to 0.85 percent – its highest level since 2008. California added 123,350 housing units on net, including 20,683 accessory dwelling units (ADUs), to bring total housing in the state to 14,707,698 units. New construction represents 116,683 housing units with 63,423 single family housing units, 51,787 multi-family housing units, and 1,473 mobile homes.
      …
      https://smdp.com/2023/05/16/population-decrease-and-housing-increase-drive-local-vacancy-rate-to-10percent/

      1. and a rebound in foreign immigration

        Too bad those people in aggregate consume a lot more gooberment resources than they contribute in taxes.

        IIRC, the official number of homeless in Clownifornia is 600-700K, so I’m gonna guess it’s closer to a million, which is one out of every 40 residents. Small wonder there are tents everywhere.

        How long will it take to reach 2 million homeless? 3 million? The state is swirling down the drain , but everyone in charge is in denial. And that’s the thing, as long as they are in charge and can grift left and right, they don’t care what happens to the state in the end. If they can steal enough they can buy their own island and escape the inevitable chaos, which appears to have already arrived in San Francisco and Portland.

  15. Tom York on Business: San Diego Sees Big Decline in 90-Minute ‘Super Commuters’
    by Tom York
    10 hours ago
    Traffic on the I-15 at junction with I-8. Photo by Chris Stone

    One way I measure the state health of the economy here is to eyeball commute patterns. Lately, I’ve noticed that traffic on I-5 is starting to get heavier both mornings and evenings. But that doesn’t explain this interesting study recently conducted by ApartmentList.com.

    The study found that the number of San Diego super commuters — workers who drive 90 minutes or more each way each day to their job — has fallen by 44% since 2019. The local decline is part of a nationwide trend.

    The report estimates that the number of super commuters in the United States has fallen by 1.5 million since 2019. This decline is largely due to the rise of remote work, which took off during the COVID-19 crisis of 2001-22.

    From 2019 to 2021 the number of super commuters in the San Diego metro area fell 44%, while the number of remote workers rose 181%, the study found.

    Nationally, commute times have fallen the fastest for high-income workers, highlighting that throughout the pandemic it has been higher-paying jobs that have more easily transitioned to remote work.

    The advent of remote work has its benefits, including reduced traffic congestion and lower emissions. It has also improved the quality of life for many workers, who no longer have to waste hours commuting each day.

    ApartmentList’s findings suggest that the rise of remote work is having a significant impact on the way Americans work and live. As more jobs become remote, the number of super commuters will likely continue to decline.

    In San Diego, the report said there are 20,726 super commuters, down from a peak of 37,012 just before the start of the pandemic in March 2020.

    The metro-wide super commuter rate stands at 1.3%, compared to 2% nationally.
    …
    https://timesofsandiego.com/business/2023/05/16/tom-york-on-business-san-diego-sees-big-decline-in-90-minute-super-commuters/

        1. Had friends who commuted from Temecula to NAS North Island every day for 7 years. Almost killed them and they got divorced. Whatever money they saved by buying so far north of work wasn’t worth it in the end.

          1. I looked at houses in Temecula once. They were much cheaper at the time, but the distance was a showstopper to me and my commute was to Rancho Bernardo, not Coronado

    2. “…drive 90 minutes or more each way each day to their job…”

      Depending on traffic that’s somewhere between 30k to 40k miles per year, so 5-years max on a car given regular oil changes, tires, fuel, etc., very expensive, and there’s the carbon footprint issue. 🙂

  17. Nolte: Washington Post Won’t Return Fake Pulitzer, ‘Stands By’ Russia Reporting

    JOHN NOLTE
    17 May 2023

    Both the far-left New York Times and Washington Post refuse to return Pulitzers for spreading the lie former President Trump colluded with Russia to win the 2016 presidential election.

    Would Hitler return a fake Pulitzer?

    Now that the Monday release of the Durham Report has debunked every facet of the Russia Collusion allegation and proved the whole thing was a politically-motivated smear campaign invented by Hillary Clinton, blessed by Barack Obama, and furthered by the FBI, there have been numerous calls for these left-wing outlets to return their fake Pulitzers.

    Why should someone be rewarded for spreading a hoax? the thinking goes. Well, I will and have argued that these corporate news outlets knew all along it was a hoax.

    Of course, they did.

    https://www.breitbart.com/the-media/2023/05/17/nolte-washington-post-wont-return-fake-pulitzer-stands-by-russia-reporting/

    1. How long until we are told to hand over everything we have to the magic people and maybe even become their slaves?

      Perhaps an AI will say that it’s right and just? Who can argue with an AI that has an IQ of 10,000?

      1. Who can argue with an AI

        I’ve got a wire cutter.

        Seriously, we can’t even build a self driving car.

        1. “Seriously, we can’t even build a self driving car.”

          It’s the outlier issues like the homeless jaywalker.

        2. I’ve got a wire cutter.

          I know, that unlike in “Colossus, the Forbin Project”, shutting down an AI is easy. My point is that the tyrants will claim that their infallible AI’s say that the masses must do xyz to “save the world”, and I fear, the masses will obey. And I suspect that if anyone tries to shut down the AI’s they will be branded as terrorists.

          Anyway, the AI’s will be frauds, tools used to control the masses.

      2. Bill Gates invested heavy in AI, and Gates claims AI will replace teachers .
        Bill Gates involved with geo-engineering by chem trails to block out Sun , already being
        done. Bill Gates heavy involved in release of mosquitos for some weird purpose.
        Gates heavy involved with bugs and fake food for populations.
        Gates big funder of WHO, and fake news, Big profiteer of vaccines and mouthpiece for forced global vaccine. Also predicts Panademics way ahead of time..
        Bill Gates involved in every conceivable evil assault on humans, including Climate Change. . He’s probably a front man for covert trillionaires that want the New World Order takeover.

  19. ‘For perspective, if the almost 12,000 units currently under construction were to be delivered evenly over the next three years, that would be 4,000 new units per year. The most the city has absorbed in a year is roughly 2,000. So, there will be at least double the number of new units the market is likely able to fill even without the additional 8,100 proposed units. ‘You’re definitely overbuilding’

    Shortage jokes aside, how does this happen? Money is free. Yields are nada. Fools chase both. This is yet another consequence of seizing control of interest rates and holding them under for too long. These primadonna’s will say we gotta cut back on humanity while we’re carpet bombing the planet with shacks and airboxes.

    1. that would add 20,000 units to an existing inventory of roughly 55,000 units

      That could easily house every single person in my little burg. And as the article says, Colorado Springs isn’t all that big, unless all these new airboxes are meant to house the millions and millions of nuevos americanos being added to the populace. Say 5 million per year are invading, they could easily fill up 2.5 million new airboxes, and of course the gooberment will pay their rent, while homeless veterans are left to rot on the streets. And there will be more coming next year, and the year after that.

  20. ‘Nearly 20% of office spaces are currently empty across the United States. It’s a milestone that exceeds the vacancy rate during the 2008 global financial crisis, and it’s worse in places like San Francisco and downtown Los Angeles, where more than a quarter of offices are sitting empty. ‘I’d say the number one implication is going to be defaults and foreclosures’

    Ken is a well known knuckle dragging stopped clock far right election denying anti vax white nationalist conspiracy theorist.

  23. FT Magazine San Francisco
    What if San Francisco never pulls out of its ‘doom loop’?
    A crisis of homelessness, drug abuse and sensationalised crime threaten the city’s future
    Tabby Kinder and George Hammond yesterday

    Just after lunchtime on a sunny day in late November, Senna Matkovic passed out and turned blue. The 10-month-old had been playing with his twin brother in the grass at Moscone Park in a quiet enclave of San Francisco. Panicking that he was choking on something she couldn’t see, his nanny called 911. A fire engine and ambulance arrived within minutes. On the ground near the slide and the swings, a paramedic undid the tiny buttons on Senna’s shirt and wired his chest to a heart monitor and put a mask over his mouth to keep him breathing. But the toddler wasn’t coming to. Senna’s pupils were constricted and, when his eyes rolled back, the paramedic decided to administer naloxone, a nasal spray that reverses opioid overdoses. Senna woke up instantly.

    “If we’d had any time at all, I’d have googled whether it’s safe to give it to a baby,” Senna’s father, Ivan, recalled. He’d rushed to the park from his home a few blocks away to find uniformed workers surrounding his child. A toxicology report later revealed Senna accidentally ingested fentanyl, an opioid that is cheaper and deadlier than heroin. The narrow rescue hinged entirely on the familiarity of San Francisco’s emergency services with a raging epidemic that has meant fentanyl overdoses are now so common that the city has expanded distribution of reversal kits to libraries, entertainment venues, churches and schools.
    …

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