I have friends that have been selling Real Estate for a decade or more and these friends have temporarily gotten out of the market to persue other careers until Real Estate gets Real again. They say they don't have it in them to look a potential buyer in the eyes and flat out lie to them just to make money. They don't want to be responsible for families falling into poverty as a result of their misleading advice. I am not at all against owning a house, in fact I believe that it is one of the greatest things you can achive, but buying a house at a ridiculous price, using a ridiculous financing is not owning a house!
Ok, it's no longer a secret anymore; real estate prices are falling. The realtors however, will try to convince you that we are at a bottom when we are no ways near a bottom; don't buy into the hype! David Lereah who stepped down as chairman of the National Association of Realtors as of May 19th has been calling a bottom for more than 6 months; in his last commentary, he says he can no longer spin the numbers and that we are in a housing recession. You won't hear much about the Long Island market specifically because the local media doesn't want you to know this. Politicians are scared and you should be too! The only thing guaranteed to keep going up here on Long Island is your property taxes. Be a spectator, not a speculator! Don't buy into a collapsing market!! Bookmark this site
Want to help? What can you do? There are many things you can do.
You can help by spreading the word about how Real Estate on Long Island is overvalued.
Send some traffic over to this site (pass around a link to this site).
Create your own site (more sites specific to Long Island would be great).
Send me any articles regarding the Long Island Real Estate market (I can't find them all).
The most dangerous terrorists are right here in the U.S.
Denver's 2006 real estate foreclosure rate is now officially the worst on record. With one month left in the year, foreclosures have already eclipsed the record set during the 1988 oil industry collapse that sent Colorado's economy into a tailspin.Denver's spiraling market should serve as a warning to the rest of the country, according to experts.
Right now you are standing on the tracks with your back to the train that is coming at you with full force and I'm trying desperately to yell out to you "GET OFF THE TRACKS!!!!!!!!!!!!!!"..... Whether you choose to listen to me or not is out of my hands..... god be with you.
More and more Long Islanders are finding themselves in the same financial squeeze as the Virgas - unable to keep up with their mortgage payments. A Newsday analysis of recent foreclosure data shows that the total number of Long Island homeowners who received new legal notices of foreclosure, called lis pendens, rose 75 percent during the past two years.
"I think what we're seeing now is really the tip of a spreading iceberg," said Pearl Kamer, the chief economist of the Long Island Association, the region's leading business group. "And it's going to affect more than the lowest-income neighborhoods on Long Island. It's going to be a middle-class phenomenon too."
Foreclosure USA Up to 4 percent of America's mortgaged homeowners might lose their homes to foreclosure in coming months, one of the nation's largest lenders predicted recently, as those homeowners find themselves trapped by heavy debt and the housing slump.
What can we do to stop Foreclosure USA? Will electing Democraps do it? I doubt it. We the people must take back our ownership of our democracy. With too little political choice, our votes will not do the job. Our money is more powerful. We must politicize consumer spending. We must have some radical, dissent-driven leadership from true progressives to send signals to the tens of millions of disgruntled Americans to cut their discretionary spending to achieve specific political reforms.
Money and greed have ruined our country. Money and citizen re-engagement can save it.
Many are coastal cities and Boston heads the list with what the organization predicts is a 55.3 percent chance for price declines. Long Island and four cities in California are the next highest risk areas on the company's list.
Some experts believe that a national housing bubble exists. Most economists don't perceive a national bubble, but agree that some local markets could pop. The most frequently mentioned markets include San Diego; Orange County, Calif.; Los Angeles; Las Vegas; Boston; New York City and Long Island; the District of Columbia; and South Florida, from West Palm Beach to Miami.
Tens of millions of families bought homes at bubble inflated prices and now face the prospect of seeing their life savings disappear in the housing crash. We may not be able to get these people's money back, but we should at least be clear on who sent them down the wrong path. Hopefully, the economists, bankers, realtors and other bubble proponents will not be in a position to wreck economic havoc yet again.
Years ago as I have witnessed the housing market rising far past the fundamentals, I knew it had to crash but wasn't certain as to how soon it would be so I kept my mouth shut; now that we are so close like I can see the lights on the train approaching, I feel it is my duty to try my best to prevent anyone I can from making the biggest financial mistake of their life. To do nothing about it is like watching a deadly accident in slow motion and not doing a thing to stop it!
Imagine going to the bank and asking, "I'd like to open an account for minus (-)$100K". After years of deposits adding up to $100K you will have $0 in the account. Silly isn't it? Well that is exactly what you will be doing if you bought a house right now. Maybe a little more, or a little less, but either way doesn't sound too good does it?
The Local Media Is Lying To You
Don't believe what Newsday is preaching in their Real Estate section, that part of the Newsday is owned by the Real Estate industry which will pay any price to lead you to believe that the market is still booming just to keep the market going a little longer so they make more money at YOUR expense. Don't be fooled by their charts that show a slight uptick in the median. The median is not a good measure of the market because all it takes is a few rich people to buy high end houses in the multi-million dollar range (think hamptons) and that will cause the median to rise even though no one or very few are buying an average house and at a reduction in price. The fact is that there are bigger price cuts right now in the higher end houses and when people buy these, it does wonders for the median!
The same goes for local video news feeds such as NEWS12. They will convince you that there is going to be a soft landing and that all is well. Look for information about Real Estate online, there are many articles explaining in black and white exactly what is going on, I have provided a couple of links to where you can find such information below. When it comes to Real Estate, you should not trust anyone who works in the industry as far as your personal finances go. They will make you believe it's a good deal or that it's better than throwing your money away on rent, but the fact is that these people are not your friends, but they will certainly make you feel like they are until they get their commission.
There is some reliable information out there on the web, but you have to search for it; any new information I come across you will find at the top of this page which I will continue to update whenever I can. The local news will not let you know the full true story about what is happening in the real world. If they're not telling you the full story than they are actually lying to you, don't trust them.
Remember when they used to say "They're not making any more of it" and that there will always be demand, well it's true, they aren't making any more of it and that's a good thing since they already have too much of it! Where is the demand now? Inventories are rising, not only here but in almost every state in this country. Georgia is now having their inventories rise, over there houses are 1/4 the price of what they are here right now, so why are the inventories rising? Because people who live here have been selling their houses for such obscene amounts of money and buying in places like Georgia, some outright with their equity. Now they are having problems selling their house, are stuck with 2 mortgages and eventually foreclose. You can see that the mini-storeage market is booming due to foreclosures. The sellers are starting to become very desperate to find a buyer. Why would you want to pay their ridiculous prices when you don't have to?
Then there are the speculators(flippers) who bought several houses and held them so they can turn them over to someone like you to reap big profits, but now they are dumping those properties and cutting their loses because the market turned. These speculators are the main reason why the prices are so out of wack! Now they are getting the punishment they deserve! Don't buy because you will be saving them and taking the punishment yourself!
The Long Island Real Estate section is claiming that 20 somethings are now buying Real Estate; it may be true that there are some buying, although most (smart ones) are leaving Long Island in search of cheaper areas to live. I read in the Newsday section that some of these folks that are buying here on Long Island are using creative financing to buy; this is upsetting to me because they are being tricked into thinking they will be able to afford it when they most certainly will soon be bankrupt. Don't let anyone tell you differently, these loan products are bad news! You can buy eventually in the next year or two when you will see significant drops!
Don't let a seller fool you by telling you that their house is 10%, 20% below market. That is just a marketing strategy that will rope some uneducated, gullible buyers. This kind of logic is silly! If the house were truly at market value, it would sell! Period! Why would they need to discount it from what people ARE willing to pay for it? (sarcasm again) Maybe they have enough money and they are really generous and would rather get less from you? Prices in 2005 are completely artificial and discounting from those comps is meaningless. Just a year ago, sellers were adding $100K to the comp value and people unknowingly actually paid that price or close to it. These people are suffering now and are finding that they can no longer afford to make payments on their mortgages so they are trying desperately to get back as much as they can before they foreclose. Don't let them use you to save their own necks because of their own stupidity. Stay out of this market! You will be happy you did! Most people who are buying are using these toxic loans with no money down, this will guarantee that the prices they pay will not hold. Do you want to put your hard earned money down on a house that will fall in price? Some of these people will walk away from their house when the price drops and lose nothing but their credit rating(if they really had any to begin with), while you on the other hand will lose that and the money you put down. Actually, according to the new tax laws, any money that your are forgiven when you file for bankruptcy, you will be 1099'ed for by your friends at the IRS. These loans that are out there with their lax lending standards have turned buying a house into a very dangerous game! Do not play this game, because you will lose! Buying into this would be like being robbed at gunpoint for just a dollar and risking your life to avoid paying that dollar!
The Truth Of The Matter
This madness has been going on for so long because people don't research things themselves, they depend on Realtors (so called professionals) that aren't going to cater to their best interests. I don't care if they are a buyers agent, they get a percentage of the commission which means if you pay more, they get more, understand? If there were actually agents out there that told the truth about Real Estate, the prices would never have gotten as high as they have, but than again, the agent wouldn't sell anything and would lose their job. I am here because I have nothing to gain by telling you the truth and my only loss is the time I spend maintaining this site. I feel that someone needs to step in and set people straight since everyone out there has their hands out for YOUR money. The information is all over the internet, but many people it seems either don't have internet access or they just don't know where to look and like I said, local news sources will side step what is happening. Agents are finally admitting that prices are dropping because they can no longer hide it, but they aren't admitting that they will continue to fall. They will say that it's turning into a normal market. It never ceases to amaze me what they will say next just to make money. Ask the realtor to put a contingency into your contract that if the value of the house you buy falls more than 30%, they will pay you the difference and you'll see how quickly they believe their own words!
If you buy now, you will be very, very disappointed! I can't predict the future, but sometimes things are just written on the wall. I would advise on waiting, but if you absolutely must buy now, make sure you lowball and all I could say is that if you can't buy with 20% down, 30 (not 40 or 50) year fixed rate mortgage, you simply should not be buying! Move if you have to, but DO NOT BUY USING A NON-CONVENTIONAL LOAN! Anyone trying to convince you to use an adjustable rate mortgage, negative amortization mortgage or any of the others is not looking out for your best interest, these people are dangerous, stay away from them! They are the ones who are advertising 1.25%. Sure, they can get you a loan for that amount, but what they don't tell you is that after a year or two, the loan will adjust and your payments will increase 150% or more and you will not be able to handle the payments. Your only salvation at that point is to sell and in this market that is already sliding, you will not be able to even break even. You will have no choice but to foreclose, lose everything you had put into it and destroy your credit! In other words, if you want to hang yourself, these people will be happy to provide the rope!
Long Island is overpopulated right now and it's only going to get worse years from now! The taxes are ridiculously high and they will continue to go higher. When your children get old enough, they certainly will not be able to live here so they will move away. Your choice is this, either live near your brothers, sisters, mother and father now and live far away from your children later or live far from your brothers, sisters, mother and father now (you can always visit!) and always live near your children! Your parents will eventually want to retire and they won't be able to afford the high cost of living here on Long Island and so they will need to move. I'm sure they would like to live closer to their grand children so they will move closer to you. Long Island also has many health issues that are usually hidden from the media.
On a side note, I have driven to the Georgia suburbs looking at all the houses they have built there and to visit some of my friends that have moved there, in fact one of them let my family stay there in their huge guest room. I was shocked by the much higher standard of living over there. I remember one of my friends who bought an existing house here on Long Island around 2001. He told me his roof was leaking and he was trying to put off having the roof redone as long as he can due to the expense, but there is only so many buckets you can put down to catch the drops when it rains! Meanwhile, the friends that I stayed with bought a brand new house in the low $200's which included all brand new appliances. He does not make alot of money, but choosing to live here instead of Long Island, he was able to afford a big screen TV and have someone come to cut his lawn (something which my roof-leaking friend wouldn't dare do and he is a well paid manager at his company!). Since it very rarely snows over there in GA, he will not have to be stuck shoveling snow in the winter time and because there aren't any trees in the immediate area, there will not be many leaves to rake in the fall. My friend in Georgia is friends with all his neighbors; I met them myself, really nice people! It seems the people over there are so much nicer than they are here on Long Island....probably because people over here are so stressed out by the way they have to live! There are no illegal apartments there because it is too affordable for anyone to want to rent there. The traffic there (in suburbia) is not any way near what it is like here on Long Island, I actually left there to drive back home(on Long Island) during their rush hour just to see what it would be like. It's like night and day if you compare to Long Island, no wonder anyone who leaves Long Island never regrets the move....but this is just Georgia, I have other friends that have moved to places like North Carolina who say they would never go back to Long Island. So why am I still here on Long Island? I am still deciding exactly where and when I want to move and that will be probably in the beginning of next year. Although houses in places like Georgia are cheaper (I shouldn't say cheaper, there are multi-million dollar McMansions over there that are bigger than any of the houses I have seen here on Long Island! Some are bigger than 15000 sf) or shall I say give you much more for your money, the prices are still a bit higher than they should be due to high demand and in a year or two they will come down a bit due to oversupply; in the meantime, my wife and I will relocate and rent which will allow us more time to research the areas and decide where we ultimately want to live and to avoid overpaying.
Why it's for sale: Daniella Belleza, 41, had expected to return to her job as a speech pathologist after an extended maternity leave but discovered she loved being home with her two boys, Mason, 4, and Logan, 3. She and her husband, Rouel, 35, fell in love with Georgia while on vacation there. They decided to move there because the lower cost of living meant Daniella could continue to stay home. [not to mention the much nicer house they will get at a MUCH lower price along with a fraction of the taxes!] asking $549kpaid $273k for it in 2001
Hector Rodriguez sits in his nearly empty home in Hicksville longing for his wife, Annalucya, and 4-year-old son, Daniel.
They have been separated since the spring, when Annalucya and Daniel moved into the family's new home in Atlanta.
Rodriguez says the idea of relocating his family to Atlanta was hard to resist. After visiting a friend in the area over a year ago, he fell in love with the location and the larger home he could buy for his money. He says Atlanta seemed like a great new opportunity for his family. [ Moving to Atlanta is a smart move, but not selling your house first is a dumb move! ]
"Everyone said I could sell the house in two to three months," says Rodriguez, who, thinking it would be better to show the Cape Cod empty to buyers, went ahead and shipped all the family's furniture to Georgia, except for a bed to sleep on. He says visits to Atlanta are few and far between.
Why it's for sale: Rachel Abraham, 37, a stay-at-home mother, says she and her husband, David, 36, who runs the mutual fund department at UBS in New Jersey, have been shopping for a "way-of-life change." The family visited North Carolina and fell in love with [ THE MUCH BETTER PRICES AND LOWER TAXES ] it - so much so that Rachel's parents and her sister's family also will be moving there.[We'll all buy brand new houses down there for less than half of what we think someone will be stupid enough to pay for our houses here!].
"My house is very, very spacious [nothing compared to NC though]. We've done everything ... new bathroom, beautifully decorated, playroom in the basement. ... I'll miss my brand-new bathroom [...NOT]"[Obviously they did all these brand new improvements just to make the house more attractive to a buyer].asking $615kpaid $472k for it in 2004 and they want to sell already?
Why it's for sale: Bubb, a 48-year-old auto-repair shop owner, says he is the only member of his family still on Long Island; his relatives have relocated to Florida. He says he is tired of the cold and is ready to join them. He plans to open a franchise restaurant with his brother. [ Could you really blame this guy? ] asking $605kpaid $285k for it in 2000
"I have three little kids," says Gonzalez, whose house is in the Elwood school district. "How long can you roll the dice and say, 'One more deployment?'" He is leaving to become a campus state police officer at North Carolina State University. [Good ole North Carolina] asking $700kpaid $172k for it in 1999
Why it's for sale: Bill Finkernagel, a 54-year-old construction supervisor, is retiring. He and wife, Susan, 52, who works in shipping and receiving, want to move to a warmer climate. They're considering Puerto Rico, the Dominican Republic or Florida. [Nice plan, Buy it with bubble bucks sell it for double 3 years later and live like a king down south]. asking $800kpaid $450k in 2004
Why it's for sale: David Melhado, 42, a vice president for an advertising agency, says he and his family want a different quality of life and warmer weather. He and his wife, Jeanne, 40, a stay-at-home-mother to Ashley, 14, and Samuel, 6, will build a new home in Wake Forest, N.C. [Not to mention the much nicer houses for mud cheap and a fraction of the taxes]. asking $450kpaid $138 for it in 1992
Why it's for sale: Murtha, a 70-year-old retired flight attendant, says she wants to be closer to her daughter and three grandchildren, who moved to North Carolina last year. [First the daughter found a beautiful house there and now the Mother follows, very smart people!]. asking $365K she bought this house many years ago so she has plenty of room to cut her price.
Why it's for sale: The Bessos' daughter, Rachel Abraham, sold her house after it was featured last year in this column. She and her family are moving to North Carolina. Michael Besso, 67, a retail merchandising associate and former restaurant owner, and his wife, Marcia, 62, a supervisor for a health charity, hope to follow [If she can find a sucker to buy her house as well]. asking $420k, no price history available for this house but according to Newsday:
Recent sale on the block:10 Arden Lane sold for $429,000 in May 2006
Why it's for sale: Susan Harvey, 49, a retired retail associate, says her mother, brother, daughter, aunts and cousins all live in Florida. She and her husband, Edward, 63, a retired operating engineer, want to join them. asking $470k, sure, take the money and run if you can. Note that in 1998, not a single house on the block sold for more than $178k.
Thinking of retiring and want a better life. Many retirees are moving to Panama. Just 2 hours south of Florida; Very cheap living in paradise. Watch the video.
The Long Island Housing Bubble
The Real Estate Bubble has burst about a year ago, but it hasn't fully hit the media just yet. The credit bubble that was feeding it has popped; you will start to see those no money down deals disappear along with the toxic loans and lax lending standards. This will cut everyone's ability to get these $500K loans that they really can't afford in the first place. If people can no longer get these loans, the prices will fall significantly. This massive bubble while it is a national problem, it is concentrated along the coasts. Long Island is one of the areas that falls into this category and if you are thinking of buying, you had better think again. You may hear some people say that the prices will drop modestly in their area and then continue to appreciate because they are in denial and they don't want to believe it, but that is just wishful thinking and is not going to happen. The crash is underway and will continue for several years, but in about one or two years will be a prime time to buy a foreclosure... There will be many of them to choose from. I do believe that the bottom of this market will not be for many years so if you feel the need to buy just a couple of years from now, go to your local bank and ask them for a list of their properties, they will be glad to get rid of them at a loss.
This Real Estate market is going to guarantee a recession. Buying a house before a recession is a very, very, bad idea and the fact that house prices are already falling right now makes it even a worse idea!
Inventories will continue to rise as more people find they can no longer make their monthly mortgage payment due to the ARM or other toxic loan they got suckered into and are forced to sell in a down market. The so called Real Estate Professionals such as David Lereah claim that the market has hit bottom and that next spring the market will rebound. David Lereah has been back pedaling optimism from the first time the market started showing signs of weakness. He lost all his credibility, I would be amazed if there were anyone who still listens to what he says.
Pain And Fear
Pain and Fear are your best friends. God gave you these when you were born to protect you. When you touch something red hot, the pain causes you to pull your hand away and save your hand; without that pain, your hand would just burn up until there is nothing left but a stub. When you're crossing a street and a big truck is coming, that fear is what causes you to go back to the sidewalk; without that fear, you will be splattered in the street. When I was younger, I heard about a kid in school who did some drugs, drank some alcohol and fell asleep on a radiator (it was a cold winter), in the morning he had been burned so badly that he took his own life while in the hospital. It was drugs and alcohol that took away his Pain, the one thing that would have prevented this and probably kept him alive today. People hear stories here and there about how the housing market is going to crash and if you buy in you will lose alot of money. This is fear, but if you talk to a Real Estate agent, they will take this fear away from you by telling you something like, "The market is softening, but if you plan to live in the house 10 years or more, your house will be worth so much more" or "Renting is throwing your money away, with a house you will build equity". They want to turn you into a fearless buyer, kind of like telling you that the train coming at you is just an illusion and you should stay on the tracks. If you foolishly ignore the fear and listen to them, the pain you will receive from seeing your house depreciate will hopefully remind you to listen to your own fears. Yes Pain and Fear are your best friends, thank God for them and DON'T LET ANYONE take them away from you!.
Here is a trick realtors will play on you:
They will take you to a house that is already set to go to contract and lead you on to believe that it is still for sale; this also covers them in case it falls through (which is very common these days) . When they show it to you, if you like it they will play some games with you. After you make an offer on it, they will tell you the offer was rejected and ask you for a higher bid; after you have reached your limit, they will tell you the owner sold it to someone else for a higher bid. They do this to stimulate the fear of losing a house so that you will be quicker to bid higher when they show you a house that is really for sale. Buying a house is an emotional driven process and these realtors will use scare tactics to get you to offer alot more than you would have otherwise; this is why you should not use a buyer's agent.
Some Useful Links:
www.ronpaul2008.com Ron Paul is the only Presidential candidate that wants to do something about the Governments debasing of our currency. Our currency shouldn't be perishable like food; its purchasing power should be preserved so people could learn to save instead of becoming a slave to debt. Just the fact that he wants to do away with our income tax system already justifies the reason for voting him in
Some good web sites for bubble information:
www.patrick.net This is a great site that has been around a very long time. He used to charge you for up to date news articles, but not anymore. If you want to blog with other people who are awaiting the crash and want to learn more, you won't find a better blog.
www.ml-implode.com As you know the subprime lenders are all dropping like flies due to a swarm of loans going bad and lenders being forced to buy back loans that they don't have the capital for; Here you can get up to date information on how many lenders have gone under as well as what the company names are and their significance in the lending industry.
www.longislandindex.org If you live here on Long Island and plan on staying, you need to read EVERYTHING on this site. You WON"T get this information from local news sources such as Newsday. It is vital information that every Long Islander should know; it's not only about housing, but about our schools, our environment, our healthcare, our utilities, our government and where our local economy is going.
www.rgemonitor.com Roubini's Global Economic Monitor - Tons of research on the economy all over the world. Probably the best economics web site I have ever seen.
www.cepr.net Center for Economic Policy Research - Dean Baker's economics web site; lots of articles on the housing bubble from an Economist who's predictions have been coming true, just quite a bit later.
www.europac.net Euro-Pacific Capitol - Peter Schiffs' official web site. Alot of good information regarding global investing, the falling dollar and crashing housing market. Peter Schiff has all his video archives here; very entertaining to watch! He also does a radio show once a week; every wednesday at 8:00 pm eastern which is also archived.
www.itulip.com Eric Janszen's economics predictions site; lots of information on our fragile economy.
www.cagw.org Citizen's Against Government Waste; this site is run by a group of individuals who are fighting the wasteful government spending. Find out how you can become part of it all. Got any dirt on local politicians and want to do something about it? Give these guys a holler; they're like your own personal mafia against politicians.
www.realestatedecline.com Excellent source of articles about the crash from all over the Country. If you want to take a drink from a firehose of information, you will find it here. This site is updated daily!
www.economyincrisis.org This is a great site for information on our national economy with statistics that will shock you. Find out how much of our country is owned by foreigners and how little we produce!
www.naphb.com This site provides a way to bypass the realtors and their fees for real estate transactions. Of course I still do not recommend buying right now but if you are selling, this might be a good alternative.
www.doctorhousingbubble.com Here's a site that started out as a California housing bubble blog and pretty much turned into a national site. Dr. Housing Bubble has written some very informative articles pertaining to the current housing conditions in all bubble areas. I highly recommend you check out this site.
www.mises.org The best austrian economics site that follows the principles of Ludwig Von Mises; the greatest economist that ever lived.
Some good blogs for bubble information and feedback:
nychousingbubble.blogspot.com A nice little blog specifically for the New York City area and it is run by an investment banker.
www.housingdoom.com Here is a great housing bubble blog covering mostly the west coast however it also covers the national housing crisis. Alot of interesting charts, graphs and up to date info.
calculatedrisk.blogspot.com A well put together blog for finance and economics. Good coverage on the mortgage meltdown and the housing bubble.
As housing bubble collapses, developers and sellers cut prices, await deals and pray for a rally in '07 (Not going to happen) - Newsday [This article is no longer available. I suspect that Newsday was told by the N.A.R. to remove it from their site because it scared away buyers; I noticed it wasn't up very long, but if you are interested, you can go to your local library, and you will be able to pull it up on their computers; I may do this myself if I get the time. I am leaving the dead link here because the title pretty much says it all.]
If there isn't enough proof presented here to keep you from buying, than go ahead and buy! We actually do need people to buy in order for bad numbers to show and selling prices to drop. You can consider yourselves, the brake pads of the housing market.
Why am I doing this? If I can save at least one family from making a big financial mistake which can seriously hurt them and probably destroy their marriage in the process, I consider that the greatest reward for my time spent providing this information! From some of the emails I have been receiving, I feel I have accomplished this. Many of them are hate mail from Realtors, but there are several others who praise me for this, I thank you all!
Please bookmark this site and come back from time to time as I am always adding more material. Those 2 scrolling windows at the top of this site will navigate to all areas on this site as well as to current News articles that are relevent to the Long Island housing bubble.
Baldwin, Bellmore, Bohemia, Cedarhurst, East Rockaway, Elmont, Franklin Square, Freeport, Garden City, Hauppauge, Hewlett, Islandia, Levittown, Lynbrook, Manorville, Medford, Merrick, Middle Island, New Hyde Park, Oceanside, Rockville Centre, Shirley, Uniondale, Valley Stream, Hempstead, Great Neck, Manhasset, Port Washington, Saddle Rock, Sands Point, Smithtown, Oyster Bay, Bayville, Bethpage, Hicksville, Massapequa, Plainview, Syosset, Woodbury, Amityville, Babylon, Lindenhurst, Bay Port, Bay Shore, Islip, Oakdale, Ocean Beach, Sayville, West Islip, N Huntington region Asharoken, Centerport, Cold Spring Hill, Cold Spring Hrbr, Commack, Dix Hills, E. Northport, Eatons Neck, Fort Salonga, Greenlawn, Huntington, Huntington Bay, Huntington Sta, Lloyd Harbor, Lloyd Neck, Melville, Northport, S. Huntington, West Hills, S Huntington region Bay Shore, Brentwood, Commack, Deer Park, Dix Hills, Huntington Sta, Melville, N. Babylon, S. Huntington, W. Bay Shore, Wheatley Heights, Wyandanch, Smithtown region Asharoken, Commack, E. Northport, Eatons Neck, Fort Salonga, Hauppauge, Head Of Harbor, Kings Park, Lake Grove, Nesconset, Nissequogue, Northport, Smithtown, St. James, Stony Brook, Babylon region Amity Harbor, Amityville, Babylon, Bay Shore, Copiague, Deer Park, E. Farmingdale, Farmingdale, Lindenhurst, Melville, N. Amityville, N. Babylon, N. Lindenhurst, Oak Beach, W. Babylon, W. Gilgo Beach, West Islip, Wheatley Heights, Wyandanch, Islip region Bay Shore, Bohemia, Brentwood, Brightwaters, Central Islip, Commack, East Islip, Hauppauge, Islandia, Islip, Islip Terrace, Lake Ronkonkoma, N. Great River, Oakdale, Ronkonkoma, W. Bay Shore, West Islip, NW Brookhaven region Belle Terre, Centereach, Coram, E. Setauket, Farmingville, Head Of Harbor, Lake Grove, Middle Island, Miller Place, Mt. Sinai, Nissequogue, Old Field, Poquot, Poquott, Port Jefferson, Pt.jefferson Sta, Rocky Point, S. Setauket, Selden, Setauket, Sound Beach, St. James, Stony Brook, SW Brookhaven region Bayport, Bexidon, Blue Point, Bohemia, Cherry Grove, E. Patchogue, East Islip, Farmingville, Great River, Holbrook, Holtsville, Islip Terrace, Lake Ronkonkoma, N. Patchogue, Oakdale, Patchogue, Ronkonkoma, Sayville, W. Sayville
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Subprime mortgages are a big problem as these are the first loans to end up in foreclosure. Normally, subprime loans are for people who don't have good credit, but nowadays it is because it's the only way they can get financing on a house that is priced well above what they can get normal financing for. Alot of these people have good credit and good income, but they wind up falling into the subprime market anyway. There are some households here on Long Island that bring in over $200k and still had to get a subprime loan because they bought a $500k house at an $800k price and couldn't come up with a 20% down payment, so they get a second (piggyback) loan which is in itself subprime just to avoid PMI. So how many loans are subprime here on Long Island and where you ask? Take a look at this subprime map that is color coded to show you where the bulk of them are, these are loans that were written in 2004, there isn't any data yet available for 2005 and 2006, but I'm sure based on articles that I keep reading that it is higher or at the bare minimum, the same. Don't think that if your mortgage isn't subprime that you are safe from a crash. If your neighbor has a subprime loan and his house goes into foreclosure, your house will lose value as a result. Remember, it is the subprime people who bought into your neighborhood at those high prices that caused the price of your house to go up and when they foreclose, it will cause the price of your house to go back down.
You may be safe from the crash providing that you:
Haven't bought a house in the past few years (except for the rich who can afford to take the loss).
Haven't drawn equity from your house (many have used equity to pay off credit cards only to ring them back up).
Haven't taken out a non-traditional loan (especially the no-money down crowd).
Have a job that can withstand a housing recession.
Have a good amount of money in the bank in case you lose a job (A recession is coming).
If you are selling, the best advice I can give you is to cut the price now, and not by a measly 5%. If you do this, you will follow the market down as your house will just sit and by the time you realize you need to cut the price, you will have to cut it alot more than you originally planned. It is those who cut their price last that will wind up cutting their price the most and therefore sell for less than they could have gotten. If you want to keep your houses for at least another decade and you have the financial capability to be able to, than by all means keep it!
This is a selection of News that I feel is relevant to Long Island. Although some of it applies to other areas, the principles are still relevant. There are many other articles out there, some websites put up a dozen or so a day, but I find that alot of these articles repeat the same News and therefore are redundant. I try to find as many interesting articles as I can that are about Long Island, but there aren't much out there. If you have some News you would like to share or have suggestions, please don't hesitate to contact me. Email address is at the bottom of this page.
David Liareah
Shoulda, Coulda, Woulda
"There is a person in my family that was working in the mortgage industry for about 5 years. She got preggo & married a guy she worked with. They bought a very average house in a desirable area with $$$ taxes at the height of the market & they were under pressure because she was very pregnant. Her DH is not from LI & is horrified at what they pay to live here. She has never lived anywhere else & her DH tells her she lives in a bubble. She has been complaining that although her DH is a great salesman, lately he can't close any of the deals on his desk because the banks won't write them. She doesn't work since having the baby. So they just came back from a trip to N.C. & TN.
Low & behold she can't believe what 300k can buy down there. They are thinking of moving.
Problem is there are at least ten homes for sale in their tiny neighborhood, most of them have been listed for 6 months plus. Some of them are much bigger/newer/better but all are listed at 60k-100k less then what she paid & they still aren't selling. Oh and they have an 100% financed IO, and they have started paying down principle yet."
[Pressure to buy because she was pregnant? Has anyone ever heard of a technology called renting? This is what happens to you when you make very big expensive decisions based on very small matters.] - LIBubble
NEW YORK (CNNMoney.com) -- Employers cut jobs in July for the seventh straight month, while the unemployment rate hit a four-year high, according to a government report released Friday.
The Labor Department reported a net loss of 51,000 jobs in the month. Economists surveyed by Briefing.com had been forecasting a loss of 75,000 jobs in the latest report.
The latest report brought job losses this year to 463,000. The June job loss number was revised to 51,000.
The unemployment rate rose to 5.7% from a 5.5% reading in June. It was the worst reading since March 2004, and slightly worse than economists' forecast of a 5.6% rate.
The rate has now jumped a full percentage point from a year ago.
But the 5.7% unemployment rate tells only part of the problem facing job seekers. It doesn't include those who have become discouraged from looking for work, or those who have accepted part-time jobs when they want to be working full time.
Counting the unemployed or underemployed, the rate rises to 10.3%, the first time that measure has hit double figures since November 2003.
Those who are out of work are also taking longer to find new jobs. There are now 1.7 million people out of work for six months or more, which is up 6% from a month early and is 28% above year-ago levels. Nearly one in five people counted as unemployed have now been out of work for six months or more.
"It is becoming increasingly hard for Americans to find work in this economy," Sen. Charles Schumer, D-N.Y., said in a statement. "As the construction, manufacturing, and now retail sectors are reeling from job losses, too many workers are being forced to reduce their hours and take part-time jobs just to make ends meet."
ALBANY _ The State Commission of Investigation reported Thursday that mortgage fraud is on the rise in New York and has hit hardest in New York City, Long Island and the Rochester area, regions where subprime loans are most common.
But the commission also notes many homeowners with poor credit share the blame for losing their homes through defaulting on mortgages.
"It is clear to the commission that, from approximately 2003 through 2006, many New Yorkers who lacked sufficient financial means were put into homes that they could not afford," according to the panel's report.
"Credit was readily available, perhaps to a greater extent than it should have been, and lenders, mortgage brokers, real estate brokers and appraisers all profited from the purchase, sale and financing of houses," the report stated.
The commission reported that foreclosures statewide were up 14 percent in the first quarter of this year compared to the same period in 2007.
"To be sure, the overwhelming desire to own a home may have clouded their judgment, causing them to ignore commonsense and basic instinct regarding the affordability of their mortgages," the commission said of homeowners caught in the national credit crisis."Owning a home was, perhaps, something they had dreamed of for a long time but could not otherwise have afforded under stricter lending standards."
ALBANY - Gov. David Paterson has frozen most hiring, ordered an additional 7 percent cut in agency spending and called on the Legislature to approve $600 million in additional cuts to shore up state finances in a New York economy that his budget director says is ''officially'' in recession.
Paterson on Wednesday proposed cutting state spending by a total of $1.23 billion in the current budget to offset a ''mammoth'' decline in revenues. He projects there will be $26.2 billion in budget deficits over the next three years, a high figure even for a state government that routinely contends with deficits because of rising spending.
''We are now officially saying New York is in a recession,'' said Budget Director Laura Anglin. She saidNew York's recessions have historically lasted 25 months, longer than national recessions.
Paterson said he will seek the Legislature's approval for $600 million in cuts spread throughout state programs, which may include midyear reductions to school districts. But Paterson said he doesn't currently any tax increases, including a temporary income tax hike for millionaires pushed by Assembly Democrats.
He said the 7 percent cut in agency funding, on top of a 3.35 percent cut in the spring, shouldn't hurt services at parks, in state police, for highway maintenance, or support for schools and hospitals.
Paterson has also called the Legislature back to Albany for an emergency economic session on Aug. 19 to enact the $600 million in cuts that need the Legislature's approval. That could include funding cuts to higher education, local hospitals and other programs as well as the leasing of state assets and services - such as the lottery - to private companies.
Those cuts, which could force higher local school tax bills, will contain most of the pain Paterson said is needed.
More than 800,000 vacant homes for sale stand between the national housing recession and the bottom. And that glut is driving down home prices, slowing sales and turning consumer psychology against the market.
New figures out Tuesday showed home prices fell by a record 15.8 percent in May from a year ago, with none of the 20 cities surveyed registering a price gain. The Standard & Poor's /Case-Shiller Home Price Index is down more than 18 percent from its peak in July 2006.
The metropolitan region, which includes Long Island, New York City and parts of New Jersey, Connecticut and Pennsylvania, posted a 7.9 percent decline from a year ago and a .5 percent drop from April, according to the index. The metro region's year-over-year drop was not as precipitous as April's 8.4 percent decline, the biggest for the year so far, and the New York area held onto prices much better than more than half the 20 cities on the list.
"The key thing is the number of unsold homes out there," said Patrick Newport, a economist at Global Insight. "That number has to come down significantly before things can get better." And that won't be until 2010, he predicts.
About 2.1 million homes were vacant and on the sales block at the end of the second quarter. In normal times, there would be only 1.3 million homes for sale.
NEW YORK (CNNMoney.com) -- May home prices dropped a record 15.8% from a year ago, according to the S&P/Case-Shiller Home Price Index of 20 cities. It was the 22nd consecutive month of decline recorded by the index. Prices fell 0.9% from April to May.
Each of the 20 metro areas covered by the index posted annual declines; nine posted record lows and 10 cities recorded double-digit drops.
The Case-Shiller 10-city Index posted a year over year decline of 16.9%, and a 1% month over month dip. Both the 10-City Composite Index and the 20-City Composite Index are reporting record annual declines.
"Since August 2006, there has not been one month where we have seen overall price increases, as measured by the two Composites," said David Blitzer, Chairman of the Index Committee at Standard & Poor's.
Case-Shiller has been tracking the 20-city index for 19 years, while the 10-city index is 21 years old. The current price decline streak has been unprecedented in both length and depth. Starting in April 1990, the 10-city index streaked down for 10 consecutive months. But that total loss was just 6.5%.
Since the 10-city index peaked in July 2006, it has plunged 19.8%. The 20-city is down 18.4%
Mortgage tax collection across Long Island plunged about $94 million, or 42 percent, in the first half of this year compared with the same period in 2007, a result of continued weakness in the real estate market and a soft economy, according to the county clerks.
Every single town, as well as Long Island's two cities, saw mortgage tax revenue plummet. The steepest decline occurred in the Town of Babylon, where revenue fell by more than 47 percent, according to the Suffolk County clerk.
In all, six towns and one city -- Long Beach -- recorded a decrease of more than 40 percent.
The drop in revenue has already forced Brookhaven and Smithtown to cut spending. Other towns are considering cutting services, dipping into reserve funds, delaying filling vacancies or putting off capital projects in order to plug anticipated budget deficits.
Local governments rely on mortgage taxes -- which represent between 11 percent and 32 percent of general fund budgets for five towns surveyed -- to help pay employees and services such as the upkeep of parks, beaches and marinas. Mortgage tax revenue help offset the amount of money towns and cities raise through property taxes.
The shortfall did not come as a surprise as troubles in the housing market and mortgage industry have been publicized. Nonetheless, the steep decline is worrisome, several town supervisors said.
"We're going to be able to withstand that loss of revenue for a period of time but not forever," said Brookhaven Town Supervisor Brian X. Foley. "Hopefully, recovery in the residential market will happen sooner rather than later. "
TAUNTON, Mass. (AP) _ A 53-year-old wife and mother fatally shot herself shortly after faxing a letter to her mortgage company saying that by the time they foreclosed on her house that day, she would be dead.
Police said that Carlene Balderrama used her husband's high-powered rifle to kill herself Tuesday afternoon, shortly after faxing the letter at 2:30 p.m.
The mortgage company called police, who found Balderrama's body at 3:30 p.m. The auction was scheduled to start at 5 p.m. and interested buyers arrived at the property in Taunton, about 35 miles south of Boston, while Balderrama's body was still inside, according to Taunton police chief Raymond O'Berg.
Police did not immediately release the name of the mortgage company. O'Berg said Balderrama's fax read, in part, "By the time you foreclose on my house I'll be dead."
O'Berg also said a suicide note found next to Balderrama told her husband, John, and 24-year-old son to "take the (life) insurance money and pay for the house."
Joe Whitney, who works with Balderrama's husband, a plumber, said that Balderrama handled the bills and her husband didn't know about the foreclosure.
"John didn't even know about it, that's the surprise," Whitney said told The Boston Globe. "It's just one of those awful, awful tragic events."
Long Island's private-sector job market in June continued to show sluggish growth amid rising unemployment, according to New York State Labor Department data released yesterday.
In addition, revised data for April showed that the Island's labor market that month actually had a net loss of jobs for the first time in two years.
In the 12 months ended in June, the Island's economy added 2,400 jobs, or a 0.2 percent increase from a year ago.
"We're outperforming the national economy, but the job growth is pretty anemic," said Gary Huth, the department's principal economist for Long Island.
The nation's economy has lost jobs since January. The state Labor Department's revised data showed that Long Island followed suit in April when a previously reported 2,100 gain in jobs turned into a 500-job loss. It was the first drop since November 2005. And one local economist expects more.
"We will see negative growth in the next several months," said Pearl Kamer, chief economist for the Long Island Association. But she added, "I don't think they are going to be massive losses because of the diverse economy."
New York City also continued to post slower job growth. The city added 20,700 jobs in the 12 months ended in June, or a year-to-year increase of just 0.6 percent. Its jobless rate climbed to 5.3 percent in June from 5.0 percent ago.
On Long Island, unemployment inched up to 4.7 percent, more than a full percentage point above June 2007's 3.6 percent. Gone are the unemployment rates in the 3 percent range that were common a year ago.
Hempstead Village had the highest unemployment rate at 6.0 percent. Riverhead Town had the lowest at 4.2 percent.
[Also not mentioned is the quality of the jobs that were gained. Low paying jobs are not too much better than job losses.] - LIBubble
Starbucks will close a total of 14 Long Island stores as part of a plan to shutter 600 of its outlets across the country by the middle of next year, the company said in releasing a full list of closings late Thursday.
Two of the Long Island stores that are to close -- one in Central Islip near the state and federal court complex and the other on Route 25 in Southhold -- were announced earlier this week.
Starbucks is also to close three of its stores in Queens, one in Brooklyn and six in Manhattan
The Seattle-based company, whose rise in the past few years had revolutionized the retail coffee industry, said early this month that it isclosing the stores because they are not profitable. Starbucks said that about 70 percent of the 600 stores to be closed opened during the company's 2006 fiscal year. The company has more than 7,000 U.S. stores.
In a brief announcement on its Web site, Starbucks said the stores will begin to close this month and that the closings are to be completed by the middle of next year. Starbucks said it was making the full list of closings available "in the spirit of transparency." It did not specify when each of the individual stores are to be closed.
In all, 39 Starbucks stores are to be closed in New York State.
The 12 additional Long Island Starbucks to be closed include the following:
426 Central Ave., Cedarhurst
2330 Hempstead Tpk., East Meadow
1946 Jericho Tpk., Elwood
123 Fulton Ave., Farmingdale
385B Broadway Mall, Hicksville
1750 Veterans Hwy., Islandia
106 Old Country Rd., Mineola
1441 Jericho Tpk., New Hyde Parkbr> 1 Railroad Ave., Roslyn Heights
20 North Highway, Southampton
467 Old County Rd., Westbury
1504 Old Country Rd., Westbury
Suffolk sales tax growth fell 1 percent in the second quarter, leaving the county unlikely to reach its budgeted sales tax revenue target by year's end, officials said yesterday.
The drop, which is a difference of about $3 million compared with the same period in 2007, leaves the county with 1.1 percent year-to-date sales tax revenue growth. That's about half the 2.25 percent growth projected in the budget approved by County Executive Steve Levy and the legislature.
It is the first time since the three months after the Sept. 11 attacks that Suffolk has experienced negative sales tax growth, county officials said.
The picture is slightly less bleak in Nassau, which reported 2.1 percent growth in sales tax revenue for the first half of the year. The county's budget projected 2.5 percent growth.
But Pearl Kamer, chief economist at the Long Island Association, said the economic picture for both counties will only get worse. She said that sincethe second-quarter figure includes spending from the federal economic stimulus checks, the third- and fourth-quarter receipts figure to be even worse.
The combination of record-high gasoline prices and an unsteady job market has led to less consumer spending, Kamer said.
"Consumers are spending what they have to on food and gas and cutting back everywhere else," she said. "With both counties highly dependent on sales tax, this means we're going to see fiscal stress on the county level for some time to come."
Two Long Island Starbucks coffee shops that opened just more than a year ago are included in the first round of closings that the national chain announced Friday.
One shop is in Central Islip, on South Research Place about a mile from the U.S. District Courthouse. The second is on Route 25 in Southold, near the hamlet's downtown. The only other closing in New York State is on Staten Island.
The initial round includes 50 Starbucks shops in 19 states. The stores slated to close were chosen because they are not profitable and are not expected to be in the "foreseeable future," a spokeswoman for the company said Monday. About 70 percent of those shops opened during the chain's 2006 fiscal year, she said.
Tom Cilmi, 44, the Islip Chamber of Commerce president, said that he suspects the closings are the result of a weakening economy in which less disposable income is available to spend on pricey coffee and pastries.
"I think, number one, Starbucks operates much in the same way as our small businesses," he said. "I believe their locations are run somewhat autonomously. With the economy today, small businesses are being affected negatively in a very profound way."
But he said he was surprised to hear of the shop's closing. "There's a large population of offices in that area, in addition to the federal building, and you would expect that those people would take advantage of that Starbucks," he said.
An even gloomier scenario may be in store for an already ailing U.S. housing market if the overall economy slips into a recession, according to UBS Securities analysts.
Falling home prices, soaring foreclosures at a time of tighter lending and rising unemployment are all weighing heavily on an already troubled housing sector, the analysts said during a conference call recently.
Lack of funding is the biggest problem facing the housing market right now, according to the analysts, with subprime and Alt-A securitized markets shutting down and banks being forced to cut their mortgage lending dramatically due to capital constraints. So-called Alt-A loans are made to borrowers with less than prime credit ratings but who are above subprime.
Fannie Mae and Freddie Mac have also cut back their lending to stressed subprime and Alt-A borrowers with low incomes and high loan-to-value ratios.
Foreclosures, which have been building over recent months as borrowers default on risky subprime home loans, are not expected to peak until late 2008 to mid-2009.
Standing on the deck of the Nightmoves, a commercial fishing trawler docked in Montauk Harbor, Mate Tiernan Crowley packed fish in ice and prepared it for a delivery truck.
He and his captain, Terence Wallace of Asharoken, had just returned from a four-day fishing expedition 65 miles offshore to waters near Nantucket, Mass. Despite a successful catch of 10,000 pounds of squid, the Nightmoves and its crew barely covered the journey's expenses, breaking even after three days. Their latest problem: the rising cost of diesel fuel that for boats hovers just above $5 a gallon and threatens, fishermen said, to further undermine an already fragile industry.
"The cost of fuel is killing us,"said Crowley, 48, of Montauk. "It's such a ... gamble. With the price of fuel, we can't travel as far, so we'll just stay in one little area and just grind away."
On similar trips made 15 years ago, he said, the Nightmoves would cover expenses in one day and have three days' worth of profit. But when it costs $6,000 to fill the vessel for a four-day trip, an $80,000 salary for what is often more than an 80-hour workweek only goes so far.
Crowley and Wallace are not alone; commercial fishing captains across Long Island said rising fuel costs are fast becoming their No. 1 problem, trumping long-held concerns over state and federal fishing regulations, still a major worry. The dual stresses are pushing the industry toward what one captain called "a state of crisis management," where any further fuel price increases or regulations could spell disaster.
"Fuel could be the last nail in the coffin," said Charles Etzel, 56, an 18-year Montauk resident and a part-time commercial fisherman who captains the 31-foot Keeper.
Others, like Chris Winkler, 48, captain of the 55-foot New Age, agree. In the past two years, fuel expenses have grown from 10 percent to 30 percent of his total budget. To conserve fuel, some fishermen have resorted to running boats at lower speeds.
The trickle-down effect means other costs related to fuel are increasing. Ice, for example, critical for keeping the catch fresh, was once considered a peripheral expense, fishermen said.But in the past two years it has doubled in price, from $35 a ton to $70 a ton.
"It's becoming impossible to turn a profit," said Brendan Casey, captain of the 65-foot, 10,000-gallon Sea Angel, docked in Freeport. "I just want to be able to pay my bills. I just want to put a roof over my head and put food on my table."
HEMPSTEAD, N.Y. (CNNMoney.com) -- Only weeks after moving into their first home in 2006, Margarita Rios celebrated Christmas with her two daughters and their families. They finally had the room to do it right, with decorations outside the Valley Stream, N.Y., house and a nice tree surrounded by presents inside.
"It was very beautiful," said Rios, who had saved for a decade to unite her children and grandchildren under one roof. "It was a dream come true."
Christmas 2008, however, is shaping up to be a nightmare. No decorations. No tree.
No house.
In February, faced with an unexpected jump in her monthly mortgage bill, Rios stopped making payments and abandoned the home, shattering her life and scattering her family.
She and her new husband moved into a tiny rental apartment in Brooklyn and are trying to negotiate with the bank to sell the house without foreclosing. One daughter relocated to Queens, while the other is heading back to Mexico with her three children to escape New York's high cost of living.
Rios is among the growing ranks of Americans trying to put their lives back together after losing their homes. About three million people were delinquent on their loans and one million homes were in foreclosure as of March 31, according to the Mortgage Bankers Association.
No one keeps track of what happens to people after they give up their homes, but their options generally are limited.Some move in with friends or family, while others end up living in their cars or in homeless shelters. Those with some means, like Rios, squeeze into rental apartments.
Falling prices aren't necessarily a green light that it's a good time to buy. In these markets, you're still better off paying a landlord than a lender.
A few years back, buying a home was sold as a no-lose proposition. But the housing bust has demonstrated that renting is often the more financially prudent decision, a new study finds.
Danilo Pelletiere, research director for the National Low Income Housing Coalition and co-author of the study, is on a mission to undo the notion that homebuying is for everybody, everywhere. He wants families to stop stretching themselves to the max, spending the grocery money to try to stay in homes they can't afford whose value is dropping by the minute.
Using a rule of thumb that truly affordable homes cost no more than 15 times their annual market rent, the study found that prices in 34 of the largest 100 metro areas still have a lot of room to fall and would leave their owners with negative equity were they to sell in four years. Read "66 cities where buying makes sense."
Hit worst would be home buyers in San Jose, Calif., the nation's priciest market. By the study's calculations, anyone who bought a low-priced home there with a 6% loan could be $355,000 in the hole in 2012. (A low-priced home was defined as 75% of the area's current median price.)
In San Francisco, you stand to lose around $254,000 in the next four years, according to the study; in Honolulu, $115,000; in Seattle, $108,000; in Washington, D.C., $81,000; and Boston, $28,000.
That's not to say prices won't eventually recover. But you could be courting disaster if you need to sell before they do recover. "In these places, if you buy in now you've got to do so with your eyes wide open," warns Pelletiere. "Now is the time for extreme caution."
[Yes; Long Island is on the list.] - LIBubble
NEW YORK (CNNMoney.com) -- Shares of mortgage financing giants Fannie Mae and Freddie Mac both plunged Monday as fears deepened about the credit crisis and housing meltdown.
In midday trading, shares of Fannie Mae (FNM, Fortune 500) were down 20% and Freddie Mac (FRE, Fortune 500) shares were down more than 22%.
Fannie Mae and Freddie Mac are government sponsored enterprises that help the mortgage market function by purchasing pools of loans and packaging them into securities.
With more than a million Americans facing foreclosure and home prices sinking, the two companies have been hit hard.
The companies bought securities backed by risky subprime mortgages when the housing market was booming, but as the housing market has buckled under credit crisis pressures, concerns have grown about their need for more capital. Some analysts have even suggested that a government bailout of the two may be necessary.
Fannie Mae has reported a loss for the past two quarters while Freddie Mac has posted three consecutive quarterly losses. Both companies are expected to report a loss in the second quarter as well.
Employers cut payrolls by 62,000 in June, the sixth straight month of nationwide job losses, underscoring the economy's fragile state. The unemployment rate held steady at 5.5 percent.
The latest snapshot of business conditions, released by the Labor Department on Thursday, showed continued caution on the part of employers who are chafing under high energy prices and are uncertain about how long the economy will be stuck in a sluggish mode, reflecting fallout from housing, credit and financial troubles.
Heavy job losses in construction, manufacturing and financial services, along with cuttbacks in retailing, eclipsed job gains in education and health services, leisure and hospitality, and government.
The report, however, weak, was largely on target with economists' forecasts. They had been expecting employers to reduce payrolls by around 60,000 jobs in June and for the unemployment rate to slip a notch to 5.4 percent.
The jobless rate spiked to 5.5 percent in May. That marked the biggest over-the-month increase in two decades and left the rate at its highest since October 2004.
Job losses in both April and May turned out to be considerably deeper than had been thought. Payrolls dropped by 67,000 in April, versus the 28,000 previously reported. And, losses in May came to 62,000, rather than the 49,000 initially estimated.
So far this year, the economy has lost a total of 438,00 jobs, an average of 73,000 a month.
The airline plans to cut nearly 7,000 jobs to offset the pain of rising fuel prices, on top of previously announced capacity reductions.
NEW YORK (CNNMoney.com) -- American Airlines said on Thursday that it plans to cut nearly 7,000 full-time employees, or 8% of its total staff, by the end of 2008.
AMR Corp., (AMR, Fortune 500) owner of carriers American Airlines and American Eagle, will eliminate about 8% of its 85,000 workers, spokesman Tim Smith told CNNMoney.com. This means that 6,800 workers could lose their jobs.
This reductions follow the airline's Wednesday report that it may cut up to 900 flight attendant jobs, or 5% of its 18,000 active flight attendants roster. Also on Wednesday, carrier AirTran Airways (AAI) said it was seeking to slash overall employee pay by 10%.
Airlines are getting badly squeezed by fuel prices. Southwest Airlines (LUV, Fortune 500) is an exception. The airline has remained profitable because it successfully hedged fuel costs to avoid the high prices. The Air Transport Association expects fuel expenses to total $61.2 billion this year, compared to $41.2 billion in 2007.
DALLAS (AP) -- American Airlines says it could cut 900 flight attendant jobs as it reduces flights to cope with record-high fuel costs.
The Fort Worth, Tex.-based airline expects to reduce jobs for pilots and mechanics too, but it hasn't released numbers yet.
American, the nation's largest carrier, said Wednesday that job cuts were necessary "to overcome near-term challenges and secure our company's long-term future."
In May, American announced it would cut domestic capacity by 11% to 12% later this year, retire some planes and cut an unspecified number of jobs.
Federal law requires employers to give 60 days' notice of major layoffs, and officials of the flight attendants' union said they received a notice Wednesday of job reductions that could start Aug. 31.
Airlines and union officials said they would try to reduce layoffs through attrition, or by employees voluntarily taking leaves of absence or sharing jobs.
American has about 18,000 active flight attendants, so 900 jobs represents 5% of the ranks.
"We've all been sitting on the edge of our seats waiting for a number," said Frank Bastien, a spokesman for the Association of Professional Flight Attendants. "Most of us were pretty pleased it wasn't higher."
(Money Magazine) -- The housing implosion is nowhere near over. In 75 of the 100 top U.S. cities, prices are expected to fall in the next 12 months according to Fiserv Lending Solutions.
The S&P Case/Shiller Home Price Index, which tracks 20 of the largest housing markets, showed prices plummeting by 12.7% in the 12 months ending February. That's the biggest fall since the index began tracking prices in 2000.
Meanwhile, foreclosure filings more than doubled in the first three months of 2008, spiking 112%. So far this year 156,463 families have lost their homes to repossessions. Many markets won't hit bottom till late 2009 or even 2010.
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Nassau/Suffolk, NY $465,000 40.2% -14.4% N.A.
Where will the money come from?
Gas and food prices are rising, mortgage interest rates are adjusting higher, loans are harder to find and unemployment is ticking up.
There's only one place left to turn, many consumers think: credit cards.
Now, instead of using credit cards for large items such as a plasma television or new furniture, many area residents are charging gasoline, milk, food and even, in some cases, other bills, experts said. And many of them are only making the minimum payment on each card -- if they can afford even that.
"A lot of typical Long Islanders seem to be overwhelmed by credit card debt," said Craig D. Robins, a Westbury bankruptcy attorney who said his clients have balances from $12,000 to $80,000 and interest rates of up to 30 percent on their cards. "Just one little financial calamity causes them to dig into their credit cards just to be able to make ends meet and pay day-to-day living expenses."
NEW YORK (CNNMoney.com) -- The latest hit to the economy could come from state houses and city halls across the nation, which are in their worst budget crisis in years.
With falling revenue from sales and income taxes, and property-tax declines looming, states, cities and towns have already laid off tens of thousands of government employees. Many expect more job cuts ahead as public officials struggle to balance their budgets.
The American Federation of State, County and Municipal Employees, a public employees union, says about 45,000 government layoffs have been announced this year.
All but four states are set to begin their new fiscal years on July 1, which means that tough decisions will have to be made soon. Economists say that cutbacks in jobs and spending by local governments could be a major drag on the overall economy.
"This isn't a wrecking ball to a healthy economy, but it could be the straw that broke the camel's back," said Bob Brusca, economist with FAO Economics in New York.
This is what happens to you when you make very big expensive decisions based on very small matters.] - LIBubble 
