09-21-2006, 10:24 AM
I don't think the speculators have left the market. Maybe the speculative buyers have left the market but the sellers haven't. The are a lot of empty houses in Puna looking for a buyer, these house have carrying cost (mortgage, insurance, taxes). Alot of people thought they would be able to cash in by building a spec home and turning a good profit, so they built with an ARM, IO or HELOC or refinanced their current home. Well these investments will turn into alligators, taking a bite out of their owners a piece at a time over months and years. Eventually the seller will decide to rent the home and they'll want to rent to cover PITI but that will be too high as other to try the same thing and as a drop in rents occurs the problem gets bigger. Then someone will take a loss sell their home and home values go down.
At the same time the economy will be struggling, people will stop using their homes as ATMs. Construction will take layoffs (alot of empty homes were built and owned by people in the trades), feeder businesses and services will take a hit. Soon people will be sending jingle mail (house keys) to the banks but new regs won't let that happen. If you are luck enough to give your home to the bank they will 1099 you for the lost and probably sue get garnishments and if you refi-ed or heloc your home they could apply for recourse and take that too. Oh yeah miss a payment and all you credit rates could be maxed, imagine Helco/water/cable asking for a bond up front, credit cards going to 22% and fico to zero so you cant get more cards.
All this time home values will be going down, national and local economies tanking. The boomers can't save us cause may don't have the funds (google it the average person goin into retirement has less than $50K in savings or retirement accounts). And boomers wont be moving here, most boomers that move to warmer places (ie Miami) return to their place of origin or move closer to family within 5 years.
This what I see as I look into my bowling ball.
Its a crazy world they oughta sell tickets.
Jared I
At the same time the economy will be struggling, people will stop using their homes as ATMs. Construction will take layoffs (alot of empty homes were built and owned by people in the trades), feeder businesses and services will take a hit. Soon people will be sending jingle mail (house keys) to the banks but new regs won't let that happen. If you are luck enough to give your home to the bank they will 1099 you for the lost and probably sue get garnishments and if you refi-ed or heloc your home they could apply for recourse and take that too. Oh yeah miss a payment and all you credit rates could be maxed, imagine Helco/water/cable asking for a bond up front, credit cards going to 22% and fico to zero so you cant get more cards.
All this time home values will be going down, national and local economies tanking. The boomers can't save us cause may don't have the funds (google it the average person goin into retirement has less than $50K in savings or retirement accounts). And boomers wont be moving here, most boomers that move to warmer places (ie Miami) return to their place of origin or move closer to family within 5 years.
This what I see as I look into my bowling ball.
Its a crazy world they oughta sell tickets.
Jared I