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Illin?
2008-03-28 12:30:00
. One of the unique phenomenons of the Great Housing Bubble was the intense speculative activity, particularly the purchase of multiple properties. When speculators who purchased multiple properties implode financially, they allow multiple properties to fall into foreclosure. One of the reason we have had such a dramatic spike in foreclosures even before the bulk of ...
More About: Rollback

Big Time
2008-03-27 12:30:00
. When you run with the big dogs, you have to lift your leg high. Today’s property is a big house for throwing big parties attended by people with big names. This is a property for those who live a big life and spend money big time. When you live here, you don’t have to keep ...
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Mistake
2008-03-26 12:30:00
. . It’s a mistake. What else can you say about the Great Housing Bubble. It is a monumental mistake: testament to the greed and folly of man. A mistake of assuredness. An instance when man’s arrogance is only surpassed by his ignorance. Unfortunately, mistakes have consequences, and we will all pay for the mistakes of ...

Inventory Panic
2008-03-25 12:30:00
.Video from our friends at the South OC Tracker. There has been a lot of talk about the declining inventories. Inventory has been declining, and sales have been increasing, but prices have also been dropping because many of the sales are REOs going at “fire sale” prices. Increasing volume and decreasing prices is not the sign ...
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The Roxbury
2008-03-24 12:30:00
. . . Why spend just a Night at the Roxbury when you can live there? Look at this fantastic property. It comes complete with a hose on the roof, termite damage on the porch, broken concrete, a leaning sidewalk light, an empty milk bottle on the walk, and a pair of statues that looks like a man ...

WOT 3-22-2008
2008-03-22 12:33:00
Thank you, Daniel Gross, for the mention in your latest article: Recession Literature, The best books, articles, and Web sites about the economic collapse. Irvinehousingblog.com is an exemplary Internet mashup. Irvine, the master-planned community in Orange County, Calif., was in many ways the epicenter of the housing boom. Many of the now-defunct ambitious subprime lenders were ...
More About: News , 2008

That?s Life ** Update **
2008-03-22 12:30:00
 The list price on 78 Sorenson is down t0 $549,000, and the property is in escrow. That’s life (that’s life), that’s what all the people say You’re ridin’ high in April, shot down in May But I know I’m gonna change that tune When I’m back on top, back on top in June I said that’s life (that’s life), ...
More About: Life , Update , Rollback

That?s the Spirit ** Update **
2008-03-22 12:29:00
This one went back to the bank on 2/4/2008 for $616,250. Our house, in the middle of our street Our house, in the middle of our Our house, was our castle and our keep Our house, in the middle of our street Our house, that was where we used to sleep Our house, in the middle of our street Our ...
More About: Update , The Spirit , Spirit , Rollback

The Abandonment of Hope
2008-03-21 12:30:00
Through me the way to the city of woe, Through me the way to everlasting pain, Through me the way among the lost. Justice moved my maker on high. Divine power made me, Wisdom supreme, and primal love. Before me nothing was but things eternal, And eternal i endure. Abandon all hope, you who enter here. Dante Alighieri — Divine Comedy . Housing market bulls must ...
More About: Hope , Rollback

Nothing to Lose
2008-03-20 12:30:00
In the era of 100% financing, speculation was widespread. Why not, speculators had nothing to lose other than their credit score, and if prices had gone up, they would have reaped a huge windfall. We have documented case after case of this behavior right here on this blog. Are we flagellating the equine after it ...

The Millionaire
2008-03-19 12:30:00
. … There are many ways to become a millionaire. You could find oil on your property like Jed Clampett from the Beverly Hillbillies, or you could have your property could go up in value $1,000,000 like today’s owners did. What would you do with $1,000,000? Some people would take the money and invest it and ...
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Bombs Away
2008-03-18 12:30:00
. . All methods of predicting future price action rely on the same basic premise: prices are tethered to some fundamental value, and although prices may deviate from this value for extended periods of time, prices eventually return to fundamental valuations. This premise has been reinforced by market observation; in fact, many estimates of fundamental value are ...
More About: Bombs

Bailouts and False Hopes
2008-03-17 12:30:00
  Bailouts and False Hopes One of the more interesting phenomenon observed during the bubble was the perpetuation of denial with rumors of homeowner bailouts. Many homeowners held out hope that if they could just keep current on their mortgage long enough, the government would come to their rescue in the form of a mandated bailout program. ...

Weekend Chart 3-16-2008
2008-03-16 16:01:00
Los Angeles House Price Predictions based on S&P/Case-Shiller Indices
More About: Weekend , Chart , 2008

Mortgage Default Losses
2008-03-15 12:30:00
A couple of weeks ago, I wrote a two part analysis post on Structured Finance and the CDO market. There was one item of import that needed clarification, so I thought I would take this weekends open thread to do it. I hope you are all enjoying the free preview of my rough draft for The ...
More About: Mortgage , Losses

REO Clearance Sale
2008-03-14 12:30:00
Hurry on down to Columbus Grove and get a sweet deal on a honey of a property!!! Over 20% off!!! Wow!!! GOURMET kitchen, PERGRANITEEL, this ONE is TURNKEY!!! This one will not last!!! Hurry!!! Buy now or you will miss your chance!!! These prices will not last forever!!! Real estate only goes up!!! Sugar, Oh, Honey ...
More About: Sale , Clearance , Clearance Sale

Floplords
2008-03-13 12:30:00
During the Great Housing Bubble, many speculators tried to make money through trading houses. The vast majority of these traders were not professionals but amateurs who thought they could be professionals. Most amateurs ended up losing money because they did not understand what it takes to be successful in a speculative market. The first and ...
More About: Rental , Analysis

Mortgages as Options
2008-03-12 12:30:00
Mortgages as Options An option contract provides the contract holder the option to force the contract writer to either buy or sell a particular asset at a given price. A typical option contract has an expiration date, and if the contract holder does not exercise their contract rights by a given date, they lose their contractual ...
More About: Mortgages

Houses and Commodities Trading
2008-03-11 12:30:00
Houses and Commodities Trading Commodities are items of value and uniform quality produced in large quantities and sold in an open market. Although every residential real estate property is unique, these properties became uniformly desired by investors because all real estate prices rose during the Great Housing Bubble. The commoditization of real estate and the active, ...
More About: Fraud , Analysis , Houses

Mortgage Equity Withdrawal
2008-03-10 12:30:00
Mortgage Equity Withdrawal Mortgage Equity Withdrawal or MEW is the process of obtaining cash through refinancing residential real estate using the accumulated equity as collateral for the loan. Before MEW, a homeowner would have to wait until the property was sold to get their equity converted to cash. Apparently, this was deemed an inefficient use of capital, so lenders found ways to “liberate� this equity with home equity lines of credit or cash-out mortgage refinancing. The impact of MEW on equity is obvious; it reduces it by increasing the loan balance. It has been noted that equity is a fantasy and debt is real, and MEW is the process of living the fantasy with the addition of very real debt. MEW has been utilized by homeowners for home improvement for decades, but the widespread use of this money for consumer spending was an innovation of The Great Housing Bubble. Since consumer spending is almost 70% of the US economy, mortgage equity withdrawal was the primary mechanism...
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Lazy River ** Update 1 **
2008-03-09 12:30:00
 Our sellers we profiled back in October of 2007 are being very stubborn about their price, but now they have opted to become floplords. $3800 Northpark Beauty At this price, the property is worth $608,000 with a 160 GRM. Anybody want to go pay them $968,000 for it? . Up a lazy river by the old mill stream That lazy, ...
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How Big Was the Bubble?
2008-03-08 12:30:00
Weekend open thread 3-8-2008 . The Size of the Bubble Figure 1 - Median Home Prices 1968-2006 ...

Take It
2008-03-07 12:30:00
Oh We’re Not Gonna Take It no, We Ain’t Gonna Take It oh We’re Not Gonna Take It Anymore we’ve Got The Right To Choose And there Ain’t No Way We’ll Lose It this Is Our Life, This Is Our Song we’ll Fight The Powers That Be Just don’t Pick Our Destiny ’cause you Don’t Know Us, You Don’t Belong oh We’re Not Gonna ...

Wishes
2008-03-06 12:30:00
When you wish upon a star Makes no difference who you are Anything your heart desires Will come to you If your heart is in your dream No request is too extreme When you wish upon a star As dreamers do Like a bolt out of the blue Fate steps in and sees you through When you wish upon a star Your dreams come true When ...
More About: Wishes , Rollback

Get Out
2008-03-05 12:30:00
In this dirty old part of the city Where the sun refuse to shine People tell me there ain’t no use in trying Now girl you’re so young and pretty And one thing I know is true you’ll gonna die before your time is due watch my daddy in bed and tired watch his hair been turning gray He’s been working and slaving ...

Systemic Risk in the Housing Market
2008-03-04 12:30:00
I’m sitting looking out the window like damn Tryna fix this situation that’s at hand You still running through my mind when I’m knowing that you shouldn’t be, Me all on yo mind and I’m knowing that it couldn’t be Cause you ain’t call and I ain’t even appalled I still got allot of pain I ain’t dealt wit it all To get you outta ...
More About: Market , Housing , Risk

Structured Finance 101
2008-03-03 12:30:00
I never believed in things that I couldnt see I said if I cant feel it then how can it be No, no magic could happen to me And then I saw you I couldnt believe it, you took my heart I couldnt retrieve it, said to myself Whats it all about Now I know there can be no doubt You can ...
More About: Finance , Analysis

WOT 3-1-2008
2008-03-01 12:30:00
This is the end Beautiful friend This is the end My only friend, the end Of our elaborate plans, the end Of everything that stands, the end No safety or surprise, the end Ill never look into your eyes…again Can you picture what will be So limitless and free Desperately in need…of some…strangers hand In a…desperate land Lost in a roman…wilderness of pain And all the children are ...
More About: 2008

A New Drug
2008-02-29 12:30:00
I want a new drug One that wont make me sick One that wont make me crash my car Or make me feel three feet thick I want a new drug One that wont hurt my head One that wont make my mouth too dry Or make my eyes too red One that wont make me nervous Wondering what to do One that makes ...
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Affordability
2008-02-28 12:30:00
It’s time you made a stand For a fee, I’m happy to be Your back door man, hey Dirty deeds done dirt cheap Dirty deeds done dirt cheap Dirty deeds done dirt cheap Dirty deeds and they’re done dirt cheap, yeah Dirty deeds and they’re done dirt cheap Dirty Deeds Done Dirt Cheap — AC/DC . . Affordability Affordability is a measure of people’s ability to raise ...