Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: BWAC who wrote (248035)	5/13/2010 8:35:07 PM
From: Jim McMannis	Respond to of 306849

Exactly...when they build it (house} the FHA is more than happy to make a crap loan on it and viola...the builders get their money. Then the mortgage gets added to the Fannie pack of loser loans.

To: BWAC who wrote (248035)	5/13/2010 8:38:04 PM
From: patron_anejo_por_favor	Read Replies (2) \| Respond to of 306849

They could have simply been allowed to go BK. That would have freed up the land for other builders, when it was actually needed. Instead the taxpayors are forced to perpetuate malinvestment, throwing good dollars (tax money) after bad (clownbux "invested" by builders on land at the bubbletop). Builders have very low barriers to entry. When they would have been needed again new ones would have sprung up like mushrooms after a spring thunderstorm. Taxpayer money was not needed and in fact using it was counterproductive. As you say, builders will build, almost irrespective of existing supply. Then they'll undercut each other and all other suppliers to "meet the nut". Which will stretch out the bottom for years and years in both housing and the general economic cycle.

To: BWAC who wrote (248035)	5/13/2010 10:26:26 PM
From: James Hutton	Respond to of 306849

They're back buying land while they're still writing the siht off from the last boom/bust. What a clusterfkuc.

To: BWAC who wrote (248035)	5/13/2010 11:53:13 PM
From: John Vosilla	Read Replies (3) \| Respond to of 306849

Wouldn't you do the same thing if you were in their shoes and you got a half completed subdivision and say $100k tied up in each of the remaining lots when you add up all the costs? Makes no sense to hold on to those lots and pay high RE taxes and interest on debt waiting for the next boom when you can build for $80k and sell the new house for $130k and keep your workers busy at the same time. What I don't get is you got the REO's and other distressed sales only a few years old easily 30-40% below what they are selling brand new for and the appraisers are getting away with such a huge adjustment in this environment? Sounds like the regulatory agencies are looking the other way yet again. I'm as mad as hell and ain't gonna take it either on this one...But hey life is short... so whatever...lol