[Rail Paul]

The Los Angeles Times has an article about the increased attention to auctions. Although foreclosed properties have long used the technique, it's gaining some respect as a tool for selling homes in the million dollar plus space.

Cher's Hawaii estate is one property likely to go under the hammer this year. Many commercial auctions in the previous year have handled blocks of condo properties, or whole buildings of unsold properties. The Kennedy Wilson site notes a 54 unit condo building, and several apartment buildings which have been auctioned recently.

The same process is well underway in Naples FL and Collier County, where several luxury developments are likely to go under the hammer. Liquidation values may be 33% of mortgage and other liabilities.


Year of the auction?

Kennedy Wilson

[porkwah]

i wish i lived where real estate prices had already gone down to reasonable levels. not here in breeder brooklyn.

[The Scream]

i wish i lived where real estate prices had already gone down to reasonable levels. not here in breeder brooklyn.

give it time. parts of my neighborhood and north of, including adjacent cities, were long considered breeder central for solid middle class families. "but the families are too solid, the schools are too good, everyone wants to live there". it all started tanking a few months ago.

[porkwah]

i wish i lived where real estate prices had already gone down to reasonable levels. not here in breeder brooklyn.

give it time. parts of my neighborhood and north of, including adjacent cities, were long considered breeder central for solid middle class families. "but the families are too solid, the schools are too good, everyone wants to live there". it all started tanking a few months ago.

no hurry.

sellers don't seem to be in much of a hurry either.

[Sneakeater]

i wish i lived where real estate prices had already gone down to reasonable levels. not here in breeder brooklyn.

Hey shush.

[JPW]

Got my triennial assessment from the county. From when it was last assessed in Jan 2007, my home value was down 23%.
Luckily, we bought low enough on the bubble (November 2002) that it's still worth more than we paid.

[The Scream]

Got my triennial assessment from the county. From when it was last assessed in Jan 2007, my home value was down 23%.
Luckily, we bought low enough on the bubble (November 2002) that it's still worth more than we paid.

friends of mine who live about 2 miles north of us paid 1.4 million at the peak of the bubble. down to 600,000 now. if you saw the house, 600,000 would seem like an absurd amount, 1.4 million was insanity. it's really a 300,000-350,000 house at best and still ridiculous compared to the vast majority of the rest of the country. it's a "cute" house, but looks kind of poor. the neighborhood is charming, but the architecture is mixed, some houses are fabulous, but there are lots of filler houses that look like little l.a. crappy cottages. before the bubble, normal affluent middle class people here felt like they had really "arrived" once they bought a 400,000-550,000 house, an amount that actually reflects real incomes for that segment of the population here. i would walk away from the mortgage if i were them.

[hollywood]

Got my triennial assessment from the county. From when it was last assessed in Jan 2007, my home value was down 23%.
Luckily, we bought low enough on the bubble (November 2002) that it's still worth more than we paid.

friends of mine who live about 2 miles north of us paid 1.4 million at the peak of the bubble. down to 600,000 now. if you saw the house, 600,000 would seem like an absurd amount, 1.4 million was insanity. it's really a 300,000-350,000 house at best and still ridiculous compared to the vast majority of the rest of the country. it's a "cute" house, but looks kind of poor. the neighborhood is charming, but the architecture is mixed, some houses are fabulous, but there are lots of filler houses that look like little l.a. crappy cottages. before the bubble, normal affluent middle class people here felt like they had really "arrived" once they bought a 400,000-550,000 house, an amount that actually reflects real incomes for that segment of the population here. i would walk away from the mortgage if i were them.

It seems that more than money is at stake for people in these situations.

[Rail Paul]

Southern California residential prices are rising?

LA Times

[Rail Paul]

The WSJ reports that deeply discounted properties in Las Vegas are less commonly found on the market. Experts differ on whether the trend is a leveling process, or just a blip as more foreclosures come on the market. There's no question that good houses in good neighborhoods are being sold in advance of foreclosure proceedings via "short sales", but a lot more dispute about others. In some cases, banks are simply letting people stay in their homes, although they're months behind in payments. Whether towns will offer similar forbearance for taxes is anyone's guess

Bargain hunters here and in many other metropolitan areas are up against a paradox. By far the biggest wave of foreclosures since the Great Depression was expected to be a bonanza for anyone with cash or the ability to get a loan. But prospective home buyers say it is increasingly difficult to find foreclosed homes at attractive prices in desirable neighborhoods.

Supply is shrinking largely because of federal and state efforts to help millions of distressed homeowners avert foreclosure, which have delayed many likely foreclosures, keeping the homes off the market for now.

The bargain chase is even tougher for those buying with a loan. Investors with cash have an advantage in that their offers aren't conditional on obtaining a loan so banks often prefer selling to them than taking the risk that another offer will fall through. They are also often quick to react when bargains appear.

So while it is still relatively easy to find a home for a few thousand dollars in Detroit, few want to move there. In the more-desirable Orange County, Calif., bidding wars are the norm on foreclosed homes.

Although the percentage of borrowers behind on payments continues to grow, the number of homes lost to foreclosure in California—and thus available for resale—fell 19% in 2009 from a year earlier to 190,360, according to MDA DataQuick, a real-estate data provider. The number of foreclosed homes owned by banks or mortgage investors and available for sale nationwide dwindled to 617,000 in December from a peak of 845,000 in November 2008, estimates Barclays Capital.

To those frustrated by the drop in supply, John Burns, a prominent real-estate consultant based in Irvine, Calif., counsels: "Just be patient. They're coming." His firm, John Burns Real Estate Consulting, estimates that five million households, currently behind on mortgage payments, will end up losing their homes, dumping supply on the market over the next few years. In Las Vegas, this "shadow" inventory of pending supply is enough to last 18 months, the firm estimates.
[Paradox]

But there is also lots of demand, especially from investors, for those homes. As a result, Mr. Burns says home prices are likely to level out rather than plunge further, assuming that mortgage rates don't rise sharply and the economy continues recovering. But if mortgage rates do surge and the economy goes into another swoon, he says, there is a "massive risk" of a sharp drop in home prices.

Mr. Iuso, the installer of security systems, isn't waiting. He is looking for a home priced at $120,000 to $150,000. "There really isn't much inventory to chase," Mr. Iuso said. His agent, Bryan Mitchell of Re/Max Associates, says some bank-owned homes have attracted more than 20 offers within days.

Investors have complaints, too. "This market has been kind of saturated" by people looking for deals, says Mr. Griffin, the investor, who bought camouflaged duck-hunting blinds to protect his employees from the wind and sun as they sit through foreclosure auctions held in a parking lot in downtown Las Vegas. More than 50 people show up daily for the auctions, about triple from the year earlier, says Mr. Griffin.

Mr. Griffin represents and advises scores of investors who are trying to buy foreclosures here. Among Mr. Griffin's regular clients is Rutt Premsrirut.

"Last summer you could make good margins," said Mr. Premsrirut. At so-called trustee sales of homes in foreclosure cases, he could win with bids at around 70% of the estimated market value. Now, he says, with more bidders, homes are likely to go for 85% to 90% of resale value. After accounting for real-estate commissions, repairs and other costs, that leaves little margin for error.

Also competing with the investors is Mr. Pawlak, head of community-resources management for Clark County, which includes Las Vegas. Mr. Pawlak leads a team charged with spending about $30 million of state and federal money awarded to the county to purchase foreclosed homes.

The federal money comes from the $6 billion Neighborhood Stabilization Program created by Congress in 2008. That program is supposed to help local organizations buy and repair foreclosed homes so they don't drag down neighborhoods. Those organizations then sell or rent the homes to people with low or moderate incomes.

WSJ

[Orik]

There are interesting shortage situations in some of the bubble markets leading to surprisingly high rents. Some of the folks who purchased early last year are making 15% returns on their investments from rent after all management expenses and fees.

[Anthony Bonner]

There are interesting shortage situations in some of the bubble markets leading to surprisingly high rents. Some of the folks who purchased early last year are making 15% returns on their investments from rent after all management expenses and fees.

surprisingly high rents is the rub tho. Vacancy rates in those markets are still high.

[porkwah]

There are interesting shortage situations in some of the bubble markets leading to surprisingly high rents. Some of the folks who purchased early last year are making 15% returns on their investments from rent after all management expenses and fees.

surprisingly high rents is the rub tho. Vacancy rates in those markets are still high.

supply kept off the market?

[Anthony Bonner]

There are interesting shortage situations in some of the bubble markets leading to surprisingly high rents. Some of the folks who purchased early last year are making 15% returns on their investments from rent after all management expenses and fees.

surprisingly high rents is the rub tho. Vacancy rates in those markets are still high.

supply kept off the market?

sticky pricing as well. rent/income ratios in those markets are out of whack if the rental yields are 15% and the Price/Income ratios are just inline with history. Unless real rental yields are about to get a lot lower - which is certainly plausible.

[Rail Paul]

CNBC puts the rental vacancy rate in Las Vegas / Paradise at 16%, which sounds low to me. Several friends own vacation or investment condos in the area, and I don't think any of them are rented out right now. Their usual practice is to rent them for a few months each year.

2009 info from CNBC