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Thread: New member

  1. #1
    John Costa's Avatar
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    Cool New member

    I am a new member from Fresno Ca and would just like to say hi to everybody out there.

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  2. #2
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    Welcome John,

    Glad You joined Us.
    .

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  3. #3
    Ron Bibler's Avatar
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    Wellcome John. I live over on the coast in Santa Rosa / Healdsburg Ca.

    Good the have a local boy around.

    We need a guy like you around hear. how are inspection in your area.

    Lots of REO. Bank inspection ? Your area was hit very hard with all this bank stuff.

    Best

    Ron


  4. #4
    mike huntzinger's Avatar
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    im up in sacramento and have lots of work doing the reo sales


  5. #5
    Ron Bibler's Avatar
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    Quote Originally Posted by mike huntzinger View Post
    im up in sacramento and have lots of work doing the reo sales
    Hey Mike. are you doing the REO For the banks or for buyers?

    Best

    Ron


  6. #6
    mike huntzinger's Avatar
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    All for clients or investors which is a good thing, people are buying them at a good deal


  7. #7
    Ted Menelly's Avatar
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    Quote Originally Posted by mike huntzinger View Post
    All for clients or investors which is a good thing, people are buying them at a good deal
    A question for you.

    Since California Real Estate was so seriously inflated by many times over what could really be a good deal. Not being sarcastic, just serious. I see little cracker boxes in California that folks buy for 300 and put 150 to 200 in them and sell them for 700 and up. You know and I know that the real worth of those homes are probably about 200 at best all fixed up. So my question stands. What consists of a good deal these days out there.


  8. #8
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    Quote Originally Posted by Ted Menelly View Post
    You know and I know that the real worth of those homes are probably about 200 at best all fixed up.
    I disagree, the REAL WORTH of those homes is what a willing buyer and a willing seller agree to.

    Nothing more, nothing less.

    During the foreclosure crisis, the sellers *are not* "willing sellers", they are forced sellers, and forced sellers must conduct 'fire sales' or lose it all regardless.

    If a willing buyer and a willing seller agree that those houses are worth $600k in this market, those homes *are* "worth $600k".

    To try to place any other value on them puts in you into trying to play price god by calculating "desirable area location" divided by "population in desirable area" divided by "population not in desirable area but desiring to get in" time the "population in the desirable area trying to get out" ... or some such other nonsense that so-called "experts" come up with.

    Jerry Peck, Construction / Litigation Consultant
    Construction Litigation Consultants, LLC ( www.ConstructionLitigationConsultants.com )
    www.AskCodeMan.com

  9. #9
    Ron Bibler's Avatar
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    In Calif. the valley area some homes were 600K 2 years back now they are pick up for 200K or less. the rents are more the the Payments.

    $ 1,500 to 1,800 a month for 3,2 1 car garage.

    So an investor with 80K down can have a poss on the cash flow.

    Thats a good deal.

    Best

    Ron


  10. #10
    Ted Menelly's Avatar
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    Jerry

    Of course the seller is going to agree that his house is worth 600,000.

    Your statement

    "If a willing buyer and a willing seller agree that those houses are worth $600k in this market, those homes *are* "worth $600k". "

    just shows the buyer is an idiot.

    Sorry. I could not help that comment. There is no other excuse. A lot of brains to have an income to afford 600,000 to offer that much but not a lick of common sence to pay 600,000 for a 100,000 dollar home.


  11. #11
    Kevin Luce's Avatar
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    Quote Originally Posted by Jerry Peck View Post
    I disagree, the REAL WORTH of those homes is what a willing buyer and a willing seller agree to.

    Nothing more, nothing less.

    During the foreclosure crisis, the sellers *are not* "willing sellers", they are forced sellers, and forced sellers must conduct 'fire sales' or lose it all regardless.

    If a willing buyer and a willing seller agree that those houses are worth $600k in this market, those homes *are* "worth $600k".

    To try to place any other value on them puts in you into trying to play price god by calculating "desirable area location" divided by "population in desirable area" divided by "population not in desirable area but desiring to get in" time the "population in the desirable area trying to get out" ... or some such other nonsense that so-called "experts" come up with.
    So three years ago when a house was bought for $20,000 around here and they turned around the next day and made an agreement for somebody to buy it for $40,000. Are you saying that the real worth is $20,000 and $40,000 since there was agreements between two parties during the purchase and the selling of the same house?


  12. #12
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    Ted, sorry to have to side with Jerry on this one, but the market sets the value of property, gas, groceries or anything else in a free market system.
    What a willing buyer and a willing seller agree on is the text book definition of market value. Speculators get into the mix and warp that model, but the market will always adjust (sometimes harshly) but long term supply and demand will eventually rule.
    I will side with you in the "idiot" on the part of some buyers during the last bubble although I suspect "greed" is more applicable than "idiot" as far a defining the mental state of buyers when the prices were escalating so rapidly.
    I suspect people having more of their own money at risk will tend to keep values more in line with market realities in the future. Same with mortgage brokers, making loans without sharing in the risk on bad loans is what got this mess cranked up to start with.

    Jim Luttrall
    www.MrInspector.net
    Plano, Texas

  13. #13
    Mitchell Toelle's Avatar
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    Hello John, and welcome to the "profession". Get a hold of your local CREIA chapter, attend a few local meetings and join CREIA as soon as you can. All the information can be found at the CREIA web site. We are more than happy to have you...and good luck.


  14. #14
    Ted Menelly's Avatar
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    Quote Originally Posted by Jim Luttrall View Post
    Ted, sorry to have to side with Jerry on this one, but the market sets the value of property, gas, groceries or anything else in a free market system.
    What a willing buyer and a willing seller agree on is the text book definition of market value. Speculators get into the mix and warp that model, but the market will always adjust (sometimes harshly) but long term supply and demand will eventually rule.
    I will side with you in the "idiot" on the part of some buyers during the last bubble although I suspect "greed" is more applicable than "idiot" as far a defining the mental state of buyers when the prices were escalating so rapidly.
    I suspect people having more of their own money at risk will tend to keep values more in line with market realities in the future. Same with mortgage brokers, making loans without sharing in the risk on bad loans is what got this mess cranked up to start with.
    Hi Jim

    With out realizing it you and Kevin said exactly what I was saying. The market was way over inflated and that is the problem, or one of the problems we are having now. No, the homes were not worth anywhere near what they were selling for and what drove the market was people with money were buying these inflated homes that were not near in the slightest what they were selling for.

    Market value. They were never in the market value. The appraisers and bankers pushed these homes to the limit. It pushed a massive amount of people out of the housing market all together.

    For an answer to Kevins question. That 20,000 dollar home was only worth 20,000 no matter what anyone else was willing to pay for it. It was never worth 40,000. There in lies the problem. Those folks should have looked a week longer and found another suitable home for that same 20,000 and the appraiser should have never appraised that home for 40,000 because a week or month earlier it was only worth 20,000.

    Both of you agreed with out saying that those homes were far above market (true market) value. Inflated market value is not true market value. This is just like the dot com boom when everyone was buying stocks that had no real value.

    Market value is what something is truly worth not what someone evaluates or appraises it for. I have no sympathy for the folks, as Ron Bibler said, that bought those homes for 600,000 when now they have come back to real market value of 200,000 and purchased them. Those 600,000 dollar folks are now paying mortgages on 600 when they should be paying a mortgage of 200.

    The text book value or real market value is exactly that real market value, not inflated value. Just because I (not really) buy a custom old ride for a million does not make it worth a million. I would have just been fool enough to buy it for a million. It would not have had a true market value of a million. Especially knowing that all inflation comes back to reality after a while and I would have a 30,000 dollar million dollar car.


  15. #15
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    Ted, yep today's market value is whatever today's willing buyer and seller settle on. But last years market value was whatever last years willing buyer and seller settled on. Market values change, sometimes quickly, sometimes up and sometimes down. The appraisers and bankers did not create the value, they are following the market. Foolish people thinking the market will only go up and they can only make money drive the price up because there is only so much supply to feed the insatiable demand.

    We are saying much the same thing except I view the change in the short term value as "real" just as much as the long term value. Changing value is real, maybe inflated, maybe foolish, but it is real.

    Jim Luttrall
    www.MrInspector.net
    Plano, Texas

  16. #16
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    Jim,

    I just don't see why Ted would pay more than ... say ... $2,500 for a large house on a large lot, I mean, after all, ... *that was the true value* of that house 80 years ago when his grand pappy built it.

    Why on earth would it, should it, cost more today?



    By the way, Ted, if a gallon of gas cost us $2, how come Europeans have to pay a lot more for their gas? Gas is gas is gas and there is no value in markets, supply, or demand, right?

    Jerry Peck, Construction / Litigation Consultant
    Construction Litigation Consultants, LLC ( www.ConstructionLitigationConsultants.com )
    www.AskCodeMan.com

  17. #17
    Ted Menelly's Avatar
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    2,500???? Where??? I'll buy that one!

    Not getting down on the Californians or the folks around Boston and such places but jeez. Come on. Those markets got so ridiculously inflated that my dead great grand mother would have seen all that coming. By the way. My opinion is that those areas are not anywhere near the bottom. There will be a serious amount of crying when it finally hits bottom. The areas where inflation did not do the dance is where it will end soon and get back to normal. The serious inflated ones are the areas that will be the hardest hit. It appears that the state I moved from, your state JP, has been taking a hit for the past year or more with their pricing. You folks will level out fairly soon. It has actually been longer than a year since all that started in Florida.

    Based on what you folks are saying is that all those stocks during the dot com boom were actually real market value. Unless I am sadly mistaken most of those stocks were worthless when sold and worthless after the crash. So what was their real market value when they were worth nothing to begin with??? They never had any value. That is like a 200,000 home that had a value of a *marketed 600,000* but was never worth more that 200,000. What was that real market value. Just cause someone paid 6 for it does not mean it had anymore of a real market value than 2.

    I know you know exactly what I mean


  18. #18
    Kevin Barre's Avatar
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    Quote Originally Posted by Jim Luttrall View Post
    Ted, sorry to have to side with Jerry on this one, but the market sets the value of property, gas, groceries or anything else in a free market system.
    What a willing buyer and a willing seller agree on is the text book definition of market value. Speculators get into the mix and warp that model, but the market will always adjust (sometimes harshly) but long term supply and demand will eventually rule.
    I will side with you in the "idiot" on the part of some buyers during the last bubble although I suspect "greed" is more applicable than "idiot" as far a defining the mental state of buyers when the prices were escalating so rapidly.
    I suspect people having more of their own money at risk will tend to keep values more in line with market realities in the future. Same with mortgage brokers, making loans without sharing in the risk on bad loans is what got this mess cranked up to start with.
    I agree with Jim. What's at work here are two different dynamics: first are areas with over-inflated values largely due to speculation, e.g., the coastal areas and other fast growth areas such as Vegas. Secondly, there are areas where the manufacturing base has taken a hit or there are other more general economic factors depressing prices. Short sales and foreclosures can be found in either area, but I suspect that sale prices will not rebound to the highs previously found in the former areas anytime real soon. Why? The value was never "really" there...much of it was pure speculation and buyer hysteria. While it's true that a home is worth what a buyer is willing to pay, much of what too many of those buyers were willing to pay was based on false assumptions. They assumed an ever-expanding market. After a few stories make their way around, people get used to the idea that they had to make a high offer NOW or lose the property. After all, someone else was standing in line to offer more if they didn't act NOW, right? That mindset fueled the market until it collapsed. Now it's time for the market to correct itself...as it always will, eventually, in a free market


  19. #19
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    Quote Originally Posted by Kevin Barre View Post
    .
    fueled the market until it collapsed.
    .
    Now it's time for the market to correct itself...
    .
    in a free market
    .
    Free???

    700 Billion and an Announced 800 Billion Additional $$$$$$$$$$$$$$$$$!!!!!
    .


    It Might have Choked Artie But it ain't gone'a choke Stymie! Our Gang " The Pooch " (1932)
    Billy J. Stephens HI Service Memphis TN.

  20. #20
    Ted Menelly's Avatar
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    Quote Originally Posted by Billy Stephens View Post
    .
    Free???

    700 Billion and an Announced 800 Billion Additional $$$$$$$$$$$$$$$$$!!!!!
    .

    Well Billy. I guess you said it all. The market is correcting itself with what. Those prices were not the free market but the so over inflated the we as US citizens are now paying for it and will for decades. Thjose prices ne er had any real market value and Billy has said it all with his statement. I still hold to the fact that just because someone buys a particular item it does not mean in the slightest that it had any real market value. Some one pays an inflated price and the next time an appraiser comes to an area and see what similar homes (even though it was only one home) sold for and then he puts a rediculaous price tag on the next house he is creating the flood and glut that cost us all bhundreds of billions if not trillions of dollars. That was not free market. That was criminal actions and the banks to give the loans based on those prices were criminal actions that drove the market through the roof. I repeat. There was no real market value. There was criminal value that we will pay for forever.


  21. #21
    Steve Lowery's Avatar
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    JP, the Europeans pay what they do for fuel because their govts. tax them that heavily.


  22. #22
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    Quote Originally Posted by Ted Menelly View Post
    That is like a 200,000 home that had a value of a *marketed 600,000* but was never worth more that 200,000. What was that real market value. Just cause someone paid 6 for it does not mean it had anymore of a real market value than 2.

    Explain why and how YOU came up with it being never WORTH more than $200,000.

    This I have to see (read).

    Jerry Peck, Construction / Litigation Consultant
    Construction Litigation Consultants, LLC ( www.ConstructionLitigationConsultants.com )
    www.AskCodeMan.com

  23. #23
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    [quote=Kevin Barre;63986]What's at work here are two different dynamics: first are areas with over-inflated values largely due to speculation, e.g., the coastal areas and other fast growth areas such as Vegas.[quote]

    I don't know about Las Vegas, but for the coastal areas, they were not "over-inflated" as you say.

    When people want to move to a coastal area, and the more people who want to move there, the supply (low) versus the demand (high) causes the value to increase. Simple economics.

    Then, when the market begins to fall off, people no longer want to, more aptly stated would be "no longer can afford to", move to those coastal areas. The supply (same supply as before) becomes closer to the demand (much less than before), so prices reflect that and drop. When the supply (still same as before) does not shrink much and even grows due to people being out of work and losing their homes, combined with the demand falling even further, the supply (now high) and the demand (now low) result in lower prices.

    The first price was not "over inflated" any more than the lower price is "under inflated". BOTH are representative of their market supply and demand function.

    If someone with tons and tons of money would come in and start buying them up, with all other things being the same, the prices would rise simply because supply would be dropping and demand would be rising. Would that than make the houses "overinflated"? No, that would, again, and still, represent "true market value".

    If you build it and they don't come, you have a white elephant you cannot get rid of.

    But if you build it and they do come, you are brilliant.

    See any difference there? Supply and demand, the supply was there both time, the demand was not (in the first example). How much was "it" worth? In the first example, 'nothing', in the second example, 'a whole lot'.

    Contrary to what Ted is saying, there is no magic "true market value" which HE can place on something 'just because it is only worth so much TO HIM'.

    Jerry Peck, Construction / Litigation Consultant
    Construction Litigation Consultants, LLC ( www.ConstructionLitigationConsultants.com )
    www.AskCodeMan.com

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