Thread: Slow Business Comment

Having a son in the real estate business I hear of all the reasons of why the market is slow.

FHA has recently raised the downpayment required for a loan.

Banks are requiring about a 700 on a credit score to obtain a loan. (If you've been late on a Blockbuster movie, your in trouble. Who has perfect credit in this type of economy)

Unemployment! No one is going to buy if they don't have a job. Plain and simple.

Many feel no job security and can't justify buying a home even though the rates are at an all time history low. 5%
My first house I paid 13% in the late 70's.

Sellers: If these people have bought a home in just the last few years, they are upside down on the value of their home and can't sell it without taking funds to the title company just to get out from underneath the home loan. This is one reason why you see all of the short sales.

Tax credit No More: After the end of the last 8K tax credit it slowed down everywhere in the real estate market. Now what do we have, we have people saying I'm not buying a home cause sure as I do they'll give out a 10K tax credit. We have become a nation of people who are willing to stand there with their hand out and think they deserve it.

Finally the Foreclosures
Foreclosures are killing us a inspectors and anyone involved in the real estate business which then affects other markets such as retail.

When someone buys a foreclosure somewhere, that knocks the guy on the same street from selling his home and buying another.

Typically real estate has always worked simply as you buy a home, and that seller then in turn buys a home.

That is not the case with a foreclosure market.

In my opinion, it is going to be tough for the next couple of years and if you don't have some money in a nest egg your ass in going to be in trouble. When I hear of people wanting to jump into this business right now or become a realtor I just cringe knowing what they are going to be in for.
Those of you that have been in this business very long know exactly what I'm talking about.

Hate to sound so negative, but its the CHANGE I guess we were all promised.

Rick

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All you say has some truth...... the part I hope you're right about is this only lasting a couple years. We're on our 4th year of a basically piss poor, declining market around here. If a genie told me we'd be back to "normal" in 2 years I'd be ecstatic.

The thing I can't believe is that the "numbers" we're being fed say the recession is over. I have friends/family in many different industries and they're all in the dumps compared to a couple years ago. And not by just a little.

I usually try to be optomistic but it's getting tougher by the day. As for the political reference I agree more than disagree but feel this is more than just a one-sided problem.... years and years of bad decisions and greed by all our leaders have got us here and I don't think a one of them has a clue how to get us out.

I have said it before and I will say it again.

At the end of the Clinton phony dot com boom the recession was never allowed to hit like a recession normally would. Sure there was a slow down but nothing like previous recessions. In previous recessions it was small to medium size businesses folding everywhere. Interest rates sky rocketing. City, state and Gov jobs were being cut because revenue just was not there.

At the end of Bushes years the same thing took place. No one was allowed to crash and burn. Sure, many did but have any of you heard of city or county or gov jobs being cut or a freeze on pay increases. Have any of you seen interest rates sore. Has anyone rounded up all the illegals that we were nice enough to let work here so they could make 5 to 10 fold or even a 100 fold what they could make in their own country. Thats right. They made enough to live here and send money to their families so they could have a better life. I am tired of hearing about what they have done for us. Lets turn that around. Look at what we did for them.

We went thru 8 years of Clinton and 8 years of Bush and now 2 years of Obama and not one administration let the capital society that we live in take its normal course of correction and let it crash and burn and build from its ashes. It has been a very slow bleed out but now the blood is almost gone and we all know what happens when you have no blood left.

If the public servants cannot be let go because the gov does not have the funds then there is a serious problem.

Everyone says what a wonderful thing Obama did with the Health care thing. Are you serious. In a time where most countries in the world are starting to flounder our gov goes on a spree of increasing every individuals cost for health care upwards already of 20% and companies like Walmart have raised their food prices by 5% and every company out there has to raise their prices on their goods to counter the increase in costs. The gov officials whether it be city, county, state or fed sit around producing nothing thinking of ways to get more revenue from an already strapped economy so everyone can keep their jobs and the assistants to assistants to assistant to the city manager of Fort Worth and every other city in the US can still be making 80,000.00 a year plus full bennies. Fort Worth city manager, 225,000, the first 4 assistants directly under them 170,000, their assistants over 100,000, their assistants 60 to 80,000 and the lowest man or woman at the bottom of the salary grade......40,000 plus sick days, vacation days, medical, dental, eye glasses and lets not forget a serious retirement later in life. What a serious joke.

It is time for the sleeping citizens of the US to act on this and it better be soon. In other countries the governments are trying to reduce some of their cost and lowering benefits and lowering retirements and medical cost and the people are storming the street and burning cars. Belgium...10,000 gov workers marching on the gov because the Gov is trying to cut cost.

What all these Gov workers are not even trying to consider is that all the homes that they are marching by protesting in front of at the evil Gov are the homes that pay their salary and there are just not the funds anymore unless you take the rest of the blood from the citizens of that country to do so and when that blood is gone............. everyone dies.

It is time to wake up

The ways things were with everyone making more and more and more and more every single year is not sustainable from any country on the planet and I am not just talking government jobs. I am talking about everyone.

Growth has to slow down. People have to settle for what they have . The playing field has to be leveled or everyone is going to trip and fall and they will all be calling out

I have fallen and I cannot get up. The view these days of everyone working their way to retirement and living fat while they are working and almost as fat as they are now when retired and the college kid that never worked a day in his life just getting out of college and thinking he is now immediately worth 60,000 a year because he got a degree has to end. Here is some news college boys and girls. Just because you went to college for 4 years and got a degree..................Does Not Mean You Deserve Anything Until You Work For It. Going to school is a wonderful thing but does not, should not and can no longer mean that "You deserve it" So far you have done absolutely nothing in life. Your life has just begun and it is time to work up thru the ranks......Not start out with 60,000 a year.

Why are we in this mess

Not because of Clinton. Not because of Bush. Not because of Obama (but he is killing us slowly) but because of us all with the I think I deserve it crap

As Rick said so eloquently

"We have become a nation of people who are willing to stand there with their hand out and think they deserve it"

Holly crap. I must be just a little disgusted with things going on nowadays.

Sorry for the morning rant.

Boo hoo hoo, I am sooo tired of hearing the pundits whine about the bad real estate market. They can't make money, they are upside down, times are tough blah, blah. It's so terrible, they have to have paperwork, qualify, have some money in reserves and an actual downpayment. Imagine that. They have to do what people had to do before 'creative financing'. Developers can't just build crappy houses anywhere and everywhere anymore, how terrible. Poor developers.
I have no sympathy for the buyers, builders, realtors and even inspectors. I saw this bust coming as early as 02-03. By 04-05 I knew it was going to be really bad. I went through the recession at the end of the 80's and didn't forget those lessons. While I was preparing and telling people the end was coming. They all told me I was a moron and didn't understand finances.
I'm not laughing now but I'm also not handing anyone a Kleenex.
The growth rates and amount of construction were unsustainable. Prices could not continue to climb as they did without wages increasing along the same lines. Fraud was rampant. Any of the big shots who state, 'they didn't know', should be fired for lying or being too stupid for their job.
It is irrelevant who is in the White House in the next few years. This will take 3-5 years minimum to work out.
Yes Hi is slow and will continue to be so for some years. I would suggest diversify your services. Do other types of inspections. In our area I see significant growth potential over the next decade for defect and consulting inspections. All this garbage that was built in the last boom is already showing problems. Owners will need answers. Will it be your phone that rings? Business will be slow if all you do is normal HI, Diversify.

Don't forget that Banks have been stopping foreclosures as well.... not sure how much of the pie can be chopped when it's shrinking...

I think Markus makes a point to diversify!!


Tighten the belt... when it's too small, buy a new one

In my area we have an added bonus to slow home sales to a drip. The county is rezoning all of the schools, it is a major issue with almost everyone in the county. Folks buy home based on where their children are going to go to school. So untill the district announces the school zones, folks are not buying home! This has been going on for a couple of months.

So many things impact home sales, we never think about the simple things like School zoning. The Williamson County TN School District has around 40,000 students in it, so it does impact just a few home buyers and sellers.

The same guy that called out the mess we are in now has been saying.
Hold on we are going to get hit with an even worse credit slam on the US economy.

I had an inspection for a guy the other day and for the first time in my 30 plus years a lender required a clearance on a property. What this is in Calif. ( No termites or WDO ) Certification.

Now the seller corrected all section 1 items listed in my original report. Then I reinspected the contractors work and issued the certification reinspection reports.

Then the Lender tells the buyer he needs to fix all Section 2 items on the original report Section 2 item are like earth to wood contacts, plumbing leaks or water stains The buyer then corrects every thing and I then reissue the certification reports. 2 weeks go by then the lender contacts to buyer and says we want you to employ another termite inspection company other then first Calif. state licensed inspection Co. My Company. So now the buyer is in the proses of employ and paying for another Calif Licensed Branch # 3 Inspection company to come out and do a second inspect on the same property. So what all this BS Is Is the lenders are all messed up. The rules they are working under are from another planet... In my 30 plus year I have never herd it takes 2 lensed inspection by 2 deferent companies to satisfy
a lender.

These are the kinds of things that are a big part of the problems thats going
to keep home sales down in the dirt...

This is a big problem of the current ruling class... Its up to the people of this country to VOTE for leaders that will stop restricting, blocking, making new rules and over taxing the very people that make things move.

Thats the little guy "You and me" We need all our freedom to work and buy and sell our private property.

Best

Ron

I've also been encountering some stories about Banks going over board on requirements. My guess is they are gun shy and are over reacting.
However, the idea that 'We need all our freedom to work and buy and sell our private property" is part of what got us into this problem.
When the argument gets made about less regulation, get government out of private transactions, etc, the one key danger factor is never mentioned. Human greed.
It would be great and make things easier for all of us if there was virtually no government intrusion into real estate transactions. Taxes, transfer stamps, mountains of paper, all gone. Great. Unfortunately things would go bad fast. The amount of human greed, lying and scamming I've seen in the last 8 years or so involving mortgage fraud is really pretty staggering. More 'Freedom' in this arena just translates into more fraud and greed.

Originally Posted by Markus Keller

When the argument gets made about less regulation, get government out of private transactions, etc, the one key danger factor is never mentioned. Human greed.

More 'Freedom' in this arena just translates into more fraud and greed.

Markus... You could not be more wrong

Greed is good Its greed that makes a man get out of bed and work all day so he can save a bunch of money to leave to his kids.

Greed is good. (Greed) Is a good word not a bad word. Like SEX. Its a good work...Now if you twist it. then its not the same SEX.any more. same with greed.

We have laws on the books that will work just fine. We don"t a freaking law that requirs our kids to put on a safety suit with 12 inches of padding before they can go out side and play...

We are in this mess because of rule changes that Barney Frank and other wack jobs like him Bank in the Clinton years told the banks to lend money to every one that walks in the front door... Thats how people got loans they could never pay back...

So we can see that before Clinton and Barney Frank changed the rules so anyone could get a loan we did not have problems. What they was force the banks to make these loans. that was the problem.

GREED IS Good Private property is just that private property.

bad rules are just that bad rules. So now we have to many bad rules that are choking the life out of the real estate industry.

Best

Ron

Originally Posted by Ron Bibler

We are in this mess because of rule changes that Barney Frank and other wack jobs like him Bank in the Clinton years told the banks to lend money to every one that walks in the front door... Thats how people got loans they could never pay back...

Ron,

1) The property boom and bust was international, was worse in some other countries (such as Spain and Ireland) than here, and is still continuing in places like urban China.

None were subject to US banking and lending regulations, and most did not employ the financing techniques usually blamed for problems here.

What primary determined if a given country experienced a bubble was whether there was strong government regulation of mortgage underwriting standards.

2) Even in the US, there was a bubble in both the high-end residential and commercial markets, both of which were financed by lenders with only minimal government regulation and oversight.

3) And even at the low end and middle of the market, around 70% of the now foreclosed loans were made by non-bank entities (such a Countrywide) which were specifically set up to avoid almost all government regulation, including the NRA.

4) And the whole while the "leadership" of the "financial community" and the most members of the Fed were saying "No problem".

We need to look way beyond the undoubted bad behavior of politicians for the underlying causes of the bubble.

Otherwise we are a bunch of rubes wandering around the aisles at Dobbs & Gramms Entertainment Emporium: you've got your Democratic snake oil tent on your left, your Republican hogwash tent on your right, and eventually you somehow find you are sitting on the economic dunking chair while the investment bankers in the audience kiss your girl and toss balls at the target.

Originally Posted by Michael Thomas

Ron,

1) The property boom and bust was international, was worse in some other countries (such as Spain and Ireland) than here, and is still continuing in places like urban China.

None were subject to US banking and lending regulations, and most did not employ the financing techniques usually blamed for problems here.

What primary determined if a given country experienced a bubble was whether there was strong government regulation of mortgage underwriting standards.

2) Even in the US, there was a bubble in both the high-end residential and commercial markets, both of which were financed by lenders with only minimal government regulation and oversight.

3) And even at the low end and middle of the market, around 70% of the now foreclosed loans were made by non-bank entities (such a Countrywide) which were specifically set up to avoid almost all government regulation, including the NRA.

4) And the whole while the "leadership" of the "financial community" and the most members of the Fed were saying "No problem".

We need to look way beyond the undoubted bad behavior of politicians for the underlying causes of the bubble.

Otherwise we are a bunch of rubes wandering around the aisles at Dobbs & Gramms Entertainment Emporium: you've got your Democratic snake oil tent on your left, your Republican hogwash tent on your right, and eventually you somehow find you are sitting on the economic dunking chair while the investment bankers in the audience kiss your girl and toss balls at the target.

I love the idea that you posed by sides as the problem. What I write below is what has taken place over the past couple decades and it is everyone's fault. Along with my post above.

"I have read several stories over the past months about the amount of foreclosed properties all the banks own. It is just a matter of time before the reality sets in that they cannot continue to hold all these properties. There WILL be a time in the not to distant future when one of the banks is going to take the step at mass wholesaling these properties to finally get them off of the books.

Once one bank takes that step you will see the tremendous influx of homes that are foreclosures hit the market at wholesale prices from all the rest of the banks or they will be the last ones holding the bag.

When that happens you will see a drop in property prices around the country. Places like California where homes that sold for 200,000 that shot up to 6-7 800,000 are going to take the biggest hit. This is a horrifying thought but is more than likely the only thing that is going to bringing the finance world and the rest of the folks in the US back to reality.

That will be the crash I was talking about in my other post.

THERE HAS BEEN NO REAL CORRECTION OVER THE PAST 18 YEARS. IT WAS NEVER ALLOWED TO HAPPEN. SOONER OR LATER THAT CORRECTION WILL HAVE TO BE MADE. THEN AND ONLY THEN WILL THIS ECONOMY COME OUT OF THE ASHES AND REBUILD.

Cost of goods, private sector wages and benefits, gov (city, county, state and fed) ridiculous public servant wages and benefits will be brought back to realistic and more sustainable levels. The road we are on will not be able to be sustained for even another year or two. Union wack jobs that think driving a bus for a living should have huge salaries and benefit and retirement packages will be brought back into check. Union auto workers which took absolutely no hit in wages, benefits and retirement will be brought back down to earth. Matter of fact we bailed out retirement funds and they still took no hit in wages benefits or retirement and I am not talking about just the auto workers. Do nothing jobs like a machine picking up a dash console and it being guided into a car and some connections plugged in FOR THOSE KINDS OF WAGES, BENEFITS AND RETIREMENT. The new ford Taurus starting at 28,000 dollars. Give me a break.

Then with corrective measures to keep the economy from growing to fast it will be on a more stable, level, playing field for a decade or 2. This will also correct countries like China from growing to its massive, totally unbalanced growing spree controlling the large part of manufacturing and paying their people crap for wages. It will bring all countries back into the game.

A corrective measure has to be made sooner than later. It will not be nice but the longer this goes on the harder the planet will be crushed. Everyone will hurt. Not just some. Drive by any restaurant in DFW and you would think there is no recession going on at all. Most folks have not been touched by this recession so they have absolutely no clue as to what to expect. It will be a seriously cruel slap in the face when it does take place."

Snake oil. Hog wash............I will go along with that. I will say that the direction that we are headed now is doing nothing but harming the future economy of the US. You do not raise prices and taxes on everything which in turn will raise prices and taxes on everything which will raise prices and taxes on everything. The spending has to be brought back into check by everyone and everyone has to be brought to the reality that the world, never mind this country, cannot sustain where we are now or the direction we are headed. You cannot keep raising social packages and giveaways and benefits and retirements for everyoine on a continuous basis. There is not enough money to be made in the world to pay the amount of tax that everyone will eventually pay to support it.

If you want to go in that direction then just look at the old USSR it did not and cannot work. Those who choose to be public servants or want to work in unions that do nothing but vote themselves more wages and benefits every year that you me and everyone pays for will have to come to the realization that it cannot continue and better reverse direction soon or they will not be working. Then of course they will want us., the folks that already pay for them, to pay completely for them or they will be at the city hall steps or the steps of the capital complaining and demanding that they get paid for. There should be about zero civil servant jobs. They should all be bid out. There should be a small level of government that is overseen by the public controlling the bidding intake. You have to understand. The higher the civil servant jobs are in pay the private sector feels they are worth more so they raise prices and wages and then of course the civil servants raise their on pay again and so on and so on. There should not be competition between gov and civil servant jobs. Civil servant salaries for the most part have overtaken many private sector salaries. Doesn't anyone else see that at all. Civil servant jobs should be voted on as far as salaries and benefits by the public. Not by the civil servants themselves.

Congress voting on their own salaries and benefits and retirement packages......What are you freaking kidding me. If we feel the congress needs a raise we should vote on it. If they are screwing up big time we should be able to vote those salaries down every 2 years. I bet that will have a serious affect on legislation.

Oh boy.....another rant.

Sure wish I were much busier. Ge, maybe if the banks wholesale the properties the home inspection business will pick back up

Im with ya Ted It would be nice to see the banks just dump everything ...

Kind of like going to the bathroom

The investers would come out of the wood works. buy everthing up. Agent would be selling. inspectors would be inspecting. Carpenters would be fixing and so on

But from what I understand the banks have been told they are not to do that.

Best

Ron

Originally Posted by Ron Bibler

Im with ya Ted It would be nice to see the banks just dump everything ...

Kind of like going to the bathroom

The investers would come out of the wood works. buy everthing up. Agent would be selling. inspectors would be inspecting. Carpenters would be fixing and so on

But from what I understand the banks have been told they are not to do that.

Best

Ron

The banks that own them can sell them for what eve they want. It's just not good business practice and I am sure the gov will step in to stop it before it goes to far but I believe there will be a good portion that get sold before the gov steps in....on purpose.

Short and Sweet
The Upside
The Cream will Rise to the TOP

Originally Posted by wayne soper

Short and Sweet
The Upside
The Cream will Rise to the TOP

Wayne I bet you never churn butter Other wise you would not talk like that...

Best

Ron

Business is so slow, tomorrow I'm inspecting a cardboard box under a bridge.

"How bad can it get?"


See my post above (#16)!