billddrummer

249 Comments

    • Housing and Financials: The Worst May Soon Be Over [view article]
      While the worst may be over, the bad will persist.

      I think housing prices will remain moribund for at least another year, perhaps more in the highly speculative markets (which everyone knows is CA, FL, NV and AZ).       Aug 28 11:15 AM
    • Merrill Lynch Analyst: July Housing Numbers Overly Optimistic [view article]
      To cusin stump,

      Your comment makes no sense to me.

      As far as the article, it raises good points about the difficulty of looking at the recent statistics as a bottom. The best you can say is that the rate of descent has diminished.

      Only after things start to rise can you say that a bottom has been reached.       Aug 28 11:10 AM
    • A Flurry Of Mixed Housing Stats [Housing Tracker] [view article]
      Hi Judy,

      Great research, thanks for your efforts!

      Ran across a report from the Wachovia Economics Group regarding housing statistics and their take on the current situation. It's available through wachovia.economics@wac...

      Their opinion is that although the bottom is in sight, a recovery depends on mortgage availability and affordability, which are primary to getting the industry off its back. (Funny, that's the same thing I've been saying too. And I'm not a formally trained economist [nor do I sport the income of one, but that's another story altogether].) The group sees some encouragement in the most recent statistics, but also cautions that meaningful recovery may take years. From now. Which would put it out until 2010 or 2011 in the worst-hit markets (FL, CA, NV, AZ).
      Aug 28 10:33 AM
    • Earnings Preview: Sears Holdings [view article]
      Poor quarterly results, to go along with all the others:

      www.bloomberg.com/apps...

      Not worth investing in, long or short term.       Aug 28 10:11 AM
    • Borders: Earning Call Notables [view article]
      A classic case of how a nimble retailer looks at its operation and figures out how to wring savings out of back office operations, without diminishing the customer's experiences.

      Border's does a better job at bookselling than Barnes & Noble. And the forward returns will prove it.       Aug 27 06:54 PM
    • Home Price Declines, But Not Everywhere [Housing Tracker] [view article]
      Hi Judy,

      Thank you for all your research. It's a pleasure to read your compilations.

      And for Still Renting,

      It's doubtful that Seattle prices will fall 30-40%. SF has a similar demographic (highly educated, limited supply of homes, essentially fully developed city), it benefited mightily from the bubble years, yet prices are only off 8% from last year. And they're still among the highest in the US.

      If SF homes drop 40%, I'd still be renting anyway. They have to fall by 90% for me to get back in the market. And that presumes I can get a mortgage loan with a foreclosure on my credit report.       Aug 27 11:17 AM
    • OFHEO: Home Prices Increased in 30 Out of 50 States Over Past Year [view article]
      I would say look at the link Dr. Perry supplied to the OFHEO report. It's much less optimistic than his analysis.

      Funny how your own source materials fail to support your conclusions, Dr.       Aug 27 10:12 AM
    • Home Price Declines, But Not Everywhere [Housing Tracker] [view article]
      Hi Judy,

      Interesting compilation, a terrific resource.

      Commentary about the CA housing market is interesting. Home sales are up (if youannualize one month's sales activity) but median prices are down, driven by distressed properties sold off by banks.

      The article says that inventory on hand is down from 10 months to 6.7 months. That's the good news. It also says that the average marketing time shrank from 50.7 days to 47.5 days. And a telling comment about Santa Barbara County buried in the footnotes--'a disproportionate number of lower priced homes' sold, thus pushing the median down in June, and accounting for its rapid rise in July.

      Here's my take on it:

      Santa Barbara County is at the edge of the bubble. I think sales are up over last year because there was virtually no mortgage money available. (If you recall, more than 100 private lenders failed in 2007, the secondary market dried up for MBSs, and CDOs, and exotic mortgage products vanished. This year, the news is all about foreclosures, stemming from loans made during the bubble frenzy.) Now, with the conforming loan limit raised to $729,000, but lenders requiring income and asset documentation, homes are selling, but for much less than they commanded a year ago. And there are waves of homes entering the markets as REOs, that were sold with exotic mortgage money 2 years ago. As I've said repeatedly, it's a series of levers that impact the housing market--affordability, availability of mortgage money, inventory, the ratio of distressed properties sold, and seasonality. July was the last month people would have bought homes before school started. Now that summer is over, look for sales to fall even further, as families with children in school elect to 'wait it out for another year, and see what happens after the elections.'

      Keep up the good work. I appreciate all your efforts!       Aug 26 07:59 PM
    • A Look Back at Circuit City Stock Performance [view article]
      To ddh,

      Apparently, people appreciate personable, knowledgeable staff, even if they're not on commission. Which would help explain why BBY has shown sales and profit growth over the past 3 years while CC has shown the reverse.

      As for the commentary, I believe it's spot on. A cash rich hedge fund (they're out there) would close the stores that don't perform, forgo any attempt to continue the big-box idea, and turn the business into a boutique chain selling to high income people.

      Or just sell off the leases and hope for the best. Either way, the company is done.



      Aug 26 04:38 PM
    • Circuit City Still for Sale - Who'll Buy It? [view article]
      To User 251231,

      Thanks, I appreciate your comments. It's too bad that CC has run aground, and the execs are exchanging chairs. There's a 'superstore' near my office, and the Verizon kiosk routinely has more customers than the rest of the store.

      The location of the store is terrible. It's on the back side of a mall, obscured by a Safeway, TJ Maxx and a big box shoe store. Immediately south is a WMT complex including a Sam's Club with gas pumps (it's jammed, too). Next door to CC is a Sports Authority (the third sporting goods retailer to try that spot--the others went out of business). But the lease on the CC runs for another 12 years, or something ridiculous. Termination costs would be immense.

      I think that's what's happening all over the chain. Poor locations, bad lease terms, low store traffic, poor service.

      And Schoonover still has a job. Amazing.       Aug 26 04:32 PM
    • More Commercial RE Foreclosures [Housing Tracker] [view article]
      Depends. If the tenants are current on their leases, the BK judge may affirm the leases as they stand, and the merchants won't have to move. But sometimes, if the loans are too far delinquent, a judge may set aside the leases and lock out the existing tenants. That can also happen if leases are delinquent when the center is foreclosed upon. That happened to an outlet of a national restaurant chain here in Reno. The franchisee wasn't paying the lease, so the center in effect evicted the restaurant. It's locked now, and the familiar sign (can't name, but it's yellow and red) now has plastic covering the logo. Aug 25 12:45 PM
    • More 'Workouts', But Will They Stem Foreclosure Tide? [Housing Tracker] [view article]
      Hi Judy,

      The article about the foreclosure bus says one or two contracts are signed after each tour.

      I wonder how many of them result in sales? It's true that banks are more willing to deal than they were a few months ago, but around here it still takes 6 weeks or more to get an answer back from the lender. It's particularly difficult if the lender has changed hands (circa Countrywide/BAC), because new people get the files and aren't familiar with processes of the new organization.

      I know of one realtor who has been trying to get a short sale completed since March. The buyers still want the house, but the lender has shuffled the file to at least 6 different people. And all of them want to recreate the documentation from the beginning.

      It's doubly frustrating for the buyers, because they have to continually reproduce a loan package. I admire their patience but at some point I think they'll find another home to purchase.

      I think the upshot will be more homes sitting on the market, waiting to be sold. Which will just add to the already bloated inventory in the marketplace.       Aug 25 11:07 AM
    • More Commercial RE Foreclosures [Housing Tracker] [view article]
      Hi Judy,

      Here in Northern NV, there's a gated golf course community that is facing foreclosure on the golf course. The HOA attempted to buy the course from its developer until it discovered how delinquent the underlying loan was. Residents are livid, and would face sharply higher association fees if they succeeded in purchasing the course. Meanwhile, the fairways and greens are not as fair or green as they were last year.

      This project (can't name it) was touted as the 'premier golf course community of Reno.' Now, it looks like a public course.       Aug 25 10:57 AM
    • Subprime Delinquencies Slowing? Guess Again [Housing Tracker] [view article]
      Hi Judy,

      A great compilation. Thanks for continuing to provide it.

      Officially, foreclosures and NODs have supposedly peaked in this area. But I think the assessor's office is way behind on its filings. (I'm still listed as owner of record on a house that was foreclosed on and sold back in September 2007, then resold to a buyer in June 2008. Neither title transfer has been recorded yet.) So there may be a number of 'shadow filings' that don't show up in the statistics. But if you look around various neighborhoods, you see dead grass, unkempt landscaping, and peeling paint, indications that people have either given up maintaining their homes, or given up the homes altogether.

      It may take another year before recordings catch up to reality. In the meantime, pundits are claiming that 'the worst is behind us.'

      I don't believe it.       Aug 25 10:52 AM
    • Lax Underwriting , Foreclosures, and Credit Crunch Stimulate Misery Industries [view article]
      Misery industries are thriving now. I've had to use pawnshops to get money to buy gas, and I've got two jobs!!

      Pawnshops, payday loan houses, car title loan shops, and the like have steady business. Banks, credit unions, and finance companies are pulling back from consumer lending because of their own liquidity issues and tightening credit criteria, forcing regular workers to seek out alternative ways to make ends meet.

      Don't forget BK attornies, process servers and collection agencies. Those businesses are in growth mode now as well.       Aug 25 10:36 AM
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