This is just seriously weird. Kane, Being, OG, and myself on one side, arguing with Rand, Hazir, Tear, and GGT (kinda. She doesn't seem really committed to it).
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This is just seriously weird. Kane, Being, OG, and myself on one side, arguing with Rand, Hazir, Tear, and GGT (kinda. She doesn't seem really committed to it).
Actually you're trying to have your cake and eat it. It's one of two; either the abandoned houses are worth something, in which case there is no problem to the balance of the bank, or they are worth (next to) nothing and they are a problem. They can't be a problem and have a serious value beyond the value of the plot they are built on.Quote:
Originally Posted by CitizenCain
The remark about the 'bigger gardens' is an expression of personal preference. I have been on your side of the pond and I have noticed that houses are on average too big for the plots they are built on (for my taste). Living in a suburb holds little attraction for me anyway, but I am one of those people who think that if you're going to live out in the sticks (anywhere beyond a beltway afaic) you should at least have a decent sized garden. And anyway, an empty, wild plot may not look so wonderful compared to a neat garden, but it beats the hell out of an abandoned, stripped and burned out wreck of a house.
Homes losing 90% value across the board would be horrible, and you ask why? :bulb: I can't imagine how awful that would be....everyone would stop paying their mortgages, but wouldn't walk away or foreclose, they'd just stay and become squatters. Municipal services and schools would lose property tax revenue and shrivel up, banks would fail, it'd be chaos. Or were you just being rhetorical?Quote:
Originally Posted by RandBlade
I didn't feel like explaining the US employment picture to Rand, or even how diverse our housing markets are. What works in Detroit won't necessarily work in Duluth, but this HAMP isn't working at all. 25% of ALL US mortgages are "underwater", whether people are employed or not.Quote:
Originally Posted by LittleFuzzy
The bubble needs to pop, and some people need help, but not at the expense of those (people like me) who made sure to have a lot of equity and affordable monthly payments. It irks me to see those who bought too much house, with 0--ZERO--down, ARMs and stated-income (liar's) loans now getting special treatment with tax money.
It irks me that HAMP was just kinda thrown together without first weeding out liar loans or people up to their necks in other credit debt and no possible way to pay, even fully employed. And they wonder why so many defaulted on the modifications? :picard:
http://www.cnbc.com/id/37193691Quote:
The program is designed to lower borrowers' monthly payments by reducing mortgage rates to as low as 2 percent for five years and extending loan terms to as long as 40 years. Mortgage companies get up to $75 billion taxpayer incentives to reduce borrowers' monthly payments.
But there have been problems from the start. One of the big ones: Initially, borrowers were able to state their income verbally and provide proof of their income later. That jammed up the system as many borrowers didn't provide a complete set of documents, and some complained that their information was lost.
Go go USA #1! :cheerleader: :mad:
I'm not sure if I fully endorse paying off other people's homes, but foreclosure and homelessness is not an option I'm for right now. I also understand that the government's first attempt at help, by giving straight to the banks, pretty much fucked over the tax payers and the home owners who never saw any support. So I can see why certain states are taking a more direct approach to the problem. If I recall, thats the idea I presented when the bailout was first brought up, I think Dread said that would result in choas.
My main beef here was Rand being so clueless and not admitting it.
I also don't quite understand how not knowing about the actual level of unemployment in the US constitutes taking a position in a debate on that topic.
Nobody wants to see widespread foreclosures, or homelessness. Or unemployment for that matter. (I've read that the US needs to create over 300,000 jobs every month and increase GDP 5% for three years, to get to 5% unemployment....)Quote:
Originally Posted by Ominous Gamer
I've grown tired of people whining about the value of their homes going down, especially if they never had equity to begin with, and using that as an excuse to walk away or get federal help. Chances are, anyone who bought in the last ten years or during the bubble has lost value, or might, if they sold today.
It's an affordable monthly payment that matters. If they're due to reset an ARM they can't afford, then FFS convert it to 5% fixed! If they can't afford that, then they probably shouldn't have been a borrower in the first place, or bought too much house. The mortgage originators should never have promised those low teaser 1-2% rates like they did....and it smacks of irresponsibility to give them 2% now. It won't create more equity, they still won't have "skin in the game", and might default after 5 years anyway.
:down:
:haha:Quote:
Originally Posted by LittleFuzzy
On way out because going away tomorrow/Thu and need to get supplies so can't add anything productive, but it is weird :haha: :)
I'm against bailing out people who took bad risks, but I'm going to reject RB's draconian take on it and unemployment. He sounds Friedmanist, like when they say that if unemployment in 10%, that means that 10% of the people are unemployable. I dislike such attitudes. Sounds like blaming the victim. Smells like the "they're poor because they choose to be poor" argument, which I've always disliked.
At some point though, I do think you would get to a potential bottom of the barrel of a prospective employee.
There is a small % of the working age population ARE unemployable.
Somewhere between 1 and 5 I'm guessing.
Oh sure. Somebody has to live on the island of misfit toys!
Garbage is that my position. My position was that you don't need to bail out everyone who's unemplyed precisely because they are employable, so let them get a job instead.Quote:
Originally Posted by ']['ear
Great! You got some ideas on how to create 300,000 jobs per month? If so, call the White House.
http://www.bls.gov/news.release/empsit.nr0.htmQuote:
Nonfarm payroll employment rose by 290,000 in April
:noob:
It is telling that you think it's the government that's responsible for "creating jobs" (one of the worst terms ever invented).
Does citing the gubment count as supporting it? Tsk tsk
Cut taxes on jobs and businesses, cut regulations and cut unemployment benefits.Quote:
Originally Posted by GGT
Jobs worth doing, then
Done.Quote:
Originally Posted by RandBlade
As opposed to government-based dig a hole in the ground so we can pay someone else to fill in in jobs.
Because there's never enough human-produced feces to around :up:Quote:
Originally Posted by RandBlade
No, actually.Quote:
Originally Posted by Hazir
Market value and [macro] economic value are not always synonymous. Water-diamond paradox and all that. So while a house may have no or very little value in the marketplace, or for the bank that forecloses on it, in macro-economic terms, it has the value of its inputs (+labor +transportation costs +a couple other things), so destroying it destroys that value.
Seriously, if you're just going to insist on demolishing the things, that's kinda stupid, because you'd do better to give unoccupied houses away to poor families. (Or even just cancel the debt and let the current/last residents stay there.) At least then you wouldn't be destroying a very expensive/valuable item that's likely just going to have to be rebuilt in the future. It's almost your textbook broken window fallacy (except that I don't think you're saying to do this to create jobs).
Again, the "abandoned, stripped and burned out wreck of a house" only happens when the whole neighborhood goes down the tube. Not when a minority of properties are uninhabited. (A full 20% of the houses on my block are currently uninhabited, but none have turned into crackdens or arson-training facilities, or whatever.)Quote:
Originally Posted by Hazir
As to yards being too small, well... personal preference, I suppose... but anyone who really wants tens of thousands of square feet of yard (at least on this continent) buys a house "out in the country" (but close enough to the city to commute), not a house in the 'burbs. No one who owns a house in the 'burbs is going to want (or even buy) a house with a full extra plot worth of lawn to mow. In fact, I selected my home based (in part) on the fact that the lot size was *smaller* than average, though the house is bigger than average. Almost half the yard to mow as my neighbors have. :D
Most people who are 30+ and are poor are poor because of their poor choices. There are some exceptions.Quote:
Originally Posted by ']['ear
If that will bring, spur, grow, encourage, create 300,000 new jobs per month, then call the White House.Quote:
Originally Posted by RandBlade
:donkey:Quote:
Originally Posted by Loki
Why? You think Obama will take a call and change policy due to a random call from a random Englishman? :rolleyes:Quote:
Originally Posted by GGT
Besides 290,000 new jobs were created in April anyway. 300k new jobs (gross) is fairly common outside of downturns. Under Reagan's second term 225,000 NET new jobs were 'created' each month on average.
Because you're outside the US, Rand. Otherwise I'd have said call your representative. :bored:
300,000 new jobs per month for three years to reach 5% unemployment....plus GDP growth at 5% each year. Those are the latest numbers I've seen. But again, this thread is only relative to unemployment for people not paying their mortgages. Even employed and able to pay their obligations, too many are using strategic defaults on "underwater" properties.
Unemployment won't reach 5% for the simple fact that there is more structural unemployment than that: the economy is becoming more advanced and there are too many people who don't have the skills to work in it.
Actually, demolishing empty houses also creates jobs. The advantage of demolishing those homes is too that the value of other houses will not be negatively influenced by the foreclosure. Giving the house to a homeless family wouldn't make economical sense because that, as you pointed out earlier will drag down the value of houses too.Quote:
Originally Posted by CitizenCain
It's the logical consequence of houses having no intrinsic value, which is basically what you claimed when you started on your tangent of the US being an awfully big place.
More empty houses than the market has demand for drags down the value of all other homes. If you want to hold the spreading of houses being worth less than the debts they are securing the easiest way to achieve this is to remove the overproduction from the stock.Quote:
Again, the "abandoned, stripped and burned out wreck of a house" only happens when the whole neighborhood goes down the tube. Not when a minority of properties are uninhabited. (A full 20% of the houses on my block are currently uninhabited, but none have turned into crackdens or arson-training facilities, or whatever.)
Yeah, I guess that's what I mean, I'd rather not live in a suburb, and would think anything turning one of those aberations into somthing that's reminiscent of 'out in the country' would be a good thing.Quote:
As to yards being too small, well... personal preference, I suppose... but anyone who really wants tens of thousands of square feet of yard (at least on this continent) buys a house "out in the country" (but close enough to the city to commute), not a house in the 'burbs. No one who owns a house in the 'burbs is going to want (or even buy) a house with a full extra plot worth of lawn to mow. In fact, I selected my home based (in part) on the fact that the lot size was *smaller* than average, though the house is bigger than average. Almost half the yard to mow as my neighbors have. :D
Demolition is an interesting idea that could work in places like Merced CA, Vegas or parts of FL. RE is appraised by comparables in the area, so a neighborhood loaded with short sales or foreclosures drags down value in other houses. Isn't that partly why banks are holding onto property, or letting defaulters stay in order to maintain the place?
In land restrictive areas (like around Chicago or San Francisco) it's not uncommon to see a nice house bought as a tear-down, just to build a bigger/better one.
Tampa has experienced a fair amount of "my bad" demolition. Investors will come in and buy several decaying buildings, or in my case an entire apartment based community, and rip it down...
Spoiler:
Its been almost 3 years now, and no one has built anything on the land that originally held the apartment I was kicked out of.