Tuesday, October 02, 2007

Housing Boom Gamblers

From CBS 13 (and video):

The county is tired of using taxpayer money to clean up the vacant properties. "The average is $1,500 to $2,000 to board up these house" said Carl Simpson, Sac. County Code Enforcement.

On Tuesday, the county may adopt the ordinance. Homeowners and mortgage companies who don't take care of properties could face fines that can go as high as 5,000 dollars in just 90 days. That could help ease some of the burden this blight is putting on taxpayers.

"We think in the spring [we] are going to see a rash and increase of open vacant home[s] because of the economy and real estate,' said Simpson.
From the Sacramento Bee:
Faced with falling home sales, builders in the flood-prone Plumas Lake development have capped the amount of fees they're willing to advance Yuba County to strengthen levees protecting thousands of new residents...A group of nine builders has been paying the fees in advance with the agreement that they would get paid back later as other landowners sought to pull building permits for their properties. This group previously had agreed to advance the county up to $135 million in fees. But now -- with the housing market in a slump -- they are willing to kick in just $30 million more -- for a total of $100 million...[County Administrator Robert] Bendorf said construction of new homes in Plumas Lake has dropped 50 percent since last year.
...
Yuba County supervisors today will decide whether to fill the gap in flood protection funding by issuing $23.3 million in debt backed by the county's general fund. It would be the largest general fund debt obligation ever assumed by the largely rural county, according to a staff report. Annual debt service would top $2 million...In theory, the county could repay the debt from future homeowner assessments, but those still have to be approved by residents, Bendorf said. Builder fees are another potential source. But if the home market remains in a slump, there's no guarantee they will materialize.
...
From the start, [Supervisor Mary Jane] Griego readily admits, Yuba County was gambling when it allowed construction to start in Plumas Lake before the levees were fixed. But she argues that it was the best way to get money for levee improvements protecting the 35,000 or so people who already live in the area.
From CBS 13 (and video):
It seems no matter where you look there are signs everywhere trying to get you to buy homes. It is a auction sign that has many homeowners not very happy. "I put all my money into this home," said Anna Alfaro, Home Owner..."These people that are coming to buy now, they have their yards landscaped and everything. How do you think we feel?" said Alfaro...People who live here say they paid close to double of what the houses will be auction off at..."It would be good if it could be turned around or if we could get our money back. At least what we put into it," said Alfaro.
From the Tri-Valley Herald:
Paseo West homeowners also chide Anderson Homes for overbuilding..."At what cost do we have to pay for their poor business plan," Cantrell said, adding that in his background as a subdivision developer others did not extend themselves that way.
...
"When we moved in, we knew we were paying more money, but we were also buying into a quality neighborhood where the price value wouldn't go down," said Joseph Leon, who moved to Paseo West from Fremont 14 months ago.

9 comments:

smf said...

From the Tri-Valley story:

"They are upset because they claim that an auction could bring down property values and change the character of the neighborhood they bought into."

Sorry, auction or not, your home prices are coming down.

And what is an upscale development doing in Manteca, anyways?

That's like a developer doing luxury townhomes in Del Paso Heights.

Max said...

"They are upset because they claim that an auction could bring down property values and change the character of the neighborhood they bought into."

Another thing to consider for potential bidders:

Would you want to live in a neighborhood where all the residents hate your guts for paying 50% of what they paid? Screw that!

Jimmy said...

"These people that are coming to buy now, they have their yards landscaped and everything. How do you think we feel?"

I may not know how this woman feels, but I know what it is she feels. It's called buyers remorse. The rest of us aren't responsible for her poor buying decisions.

Rob Dawg said...

The Serin Ordinance.

Cmyst said...

I viewed that video and I did not see an upscale development. I saw the same style of stucco 2-story house on a relatively small lot that is ubiquitous across Sacto and the Central Valley.
When I think "upscale development" I sure don't think of these kinds of houses.
These folks may have paid uptown prices, but they've got a downtown home.

pavlovianvestor said...

"It would be good if it could be turned around or if we could get our money back. At least what we put into it," said Alfaro.

There's a lot of folks in that situation. Here's what you do- sell your house, jackass. Oh, I forgot, that's not a "fair" option since you'd probably lose money. Oh well, guess you're stuck. Cocktail party real estate genius looser.

Sippn said...

."At what cost do we have to pay for their poor business plan," Cantrell said, adding that in his background as a subdivision developer others did not extend themselves that way. . ."

What? really this buyer was a subdivision developer? Quoting Gwynster, I call BS.

All these guys were over building because they couldn't meet demand, demand created by a mortgage market created elsewhere, pushed by Wall Street funding. . . plenty of blame to go around the IQ band, including Mr. Cantrell. He just wants $20K. Greed comes in all forms.

Gwynster said...

That 20k is nothing but begging for Hush money. If the comps come in at 200k below their purchase prices, 20k is a pinkie bandaid on a sucking chest wound. Cantrell and the others are asking for it publically is all. It's beyond stupid. You ask for hush money before you go to the media nimrod.

The other possiblity is that they all want 20k to to pad the bank account a little for when they walk. You know, I'm going with 2#.

Sac_Sol said...

""When we moved in, we knew we were paying more money, but we were also buying into a quality neighborhood where the price value wouldn't go down," said Joseph Leon, who moved to Paseo West from Fremont 14 months ago."

Another genius. Paid more money for a neighborhood where the price wouldn't go down. Perhaps people should be required to complete a training session on market pricing prior to being approved for a mortgage.