May 8, 2009

California had most subprime loans, study says

California had most subprime loans, study says
California was the center of the mortgage meltdown that led to the nation’s current economic crisis, as lenders in the state issued a majority of all recent subprime loans, says a nonprofit journalism group based in Washington.

The study published Wednesday on the Center for Public Integrity’s Web site analyzed government data on $1.38 trillion worth of subprime mortgages made from 2005 to 2007.

The analysis found that about 56 percent of those loans were originated by 15 lenders from California.

“The size of the industry in California was massive,” said John Dunbar, lead reporter on the six-person team that spent more than six months analyzing millions of mortgages.

Titled “Who’s Behind the Financial Meltdown,” the report examines the causes and consequences of subprime lending. Subprime lenders created mortgages that gave people with low credit ratings cheap initial payments that grew more expensive over time. Some subprime lenders allowed people to state their income without documenting it.


Consumer and industry experts said one reason lenders in California were so big in subprimes is that the state is the nation’s largest and, arguably, costliest, real estate market, making it a natural home-lending center.

“The market was hotter here than just about anywhere else in the country,” said Dustin Hobbs, spokesman for the California Mortgage Bankers Association.

Hobbs said subprime mortgages allowed many buyers to get properties they couldn’t finance with traditional loans, and, he said, the “vast majority” of such borrowers are current on their payments.

But Norma Garcia with the Consumers Union said California law doesn’t protect people against lending practices that allow them to get in over their heads.

“California was a very comfortable place for these subprime lenders to do business,” she said.

I don’t know about you, but it’s been a long week, so I’m glad this came out. It’s great to see that we are number 1! Woot!

My takeaways from this piece: California mortgage brokers worked hard to ensure that Californian home buyers had the freedom and liberty to get any type of mortgage, and any type of house they wanted.

Freedom! Liberty! Can the American dream be better represented in any way?

Thank goodness for California!

Comments (75) -- Posted by: burbed @ 6:25 am

May 3, 2009

Need agent ONLY to help me with offer and closing on a house – what is the fee for this?

Need agent ONLY to help me with offer and closing on a house – what is the fee for this? – Trulia Voices
Need agent ONLY to help me with offer and closing on a house – what is the fee for this?

Burbed reader T.M. suggested that I share this with everyone. Here’s what he had to say about this thread:

Hi Burbed – thought you’d enjoy this gem of a discussion on the Advice pages of the realtor-supported website, Trulia, said “advice” consisting mainly of spammy advertisements for members of the realtors’ cartel.

Watch as a poor hapless customer in San Jose seeking advice on finding a simple fee-for-service arrangement gets over 100 self-serving, inaccurate, semi-literate replies, with realtor after realtor trying to persuade him that as a buyer, he will pay nothing if he and the seller each use 3% brokers.

Actually, T.M. had a lot more to say, but this in itself is comedy gold. Check out the thread. There’s definitely a lot of… uh… advice!

Comments (10) -- Posted by: burbed @ 5:41 am

May 1, 2009

Burbed thanks Richard

Burbed would like to thank Richard for his gracious $10 donation.

Thanks Richard!

Comments (5) -- Posted by: burbed @ 4:24 am

April 30, 2009

You're probably wondering the same thing I am…

Swine flu. How will it impact the housing market in the Real Bay Area?

Will it cause prices to soar, or prices to hold steady?

In favor of soaring prices:

1. The Real Bay Area is special. Living there will increase your immune system. Therefore, it will become more desirable.

2. The Real Bay Area is further away from Mexico.

3. The Real Bay Area is full of rich people, which means that people can afford great healthcare coverage, N99 masks, etc. Thus, you will not be likely to be around sick people.

In favor of prices holding steady:


Debate resolved. Do you agree?

Comments (11) -- Posted by: burbed @ 5:00 am

April 26, 2009

Blue Collar, White Collar, Silicon Valley

A while back, Burbed reader DreamT made this comment:

Can you park a space shuttle, a fire truck, or a blimp in this Fremont house? | SF Bay Area Home Price and Mortgage Insanity Blog –
DreamT Says:
April 16th, 2009 at 11:46 pm

Ask a $25k earner his social strata and he’ll say he’s middle class. Ask a $250k earner and he’ll also say he’s middle class. In fact, the $250k earner points out he cannot afford a house “in the Silicon Valley”
The differences are where you want to see them. They’re in the eye of the beholder, and speak about who you are rather than what you see. The concept of “blue” versus “white” collar, originally meaningful when you had full segregation of management vs floor workers, closed door offices, different clothing, different “villages” – it never applied as little as in recent times’ Silicon Valley. You say so yourself by pointing out they are only divided by a street that’s not even an Expressway. What segregates people in the bay area is their nationality or ethnicity, and the timing of their arrival in the bay area, rather than their income, education or even job. The parents of fellow Engineers I worked with, grew up and still live in Palo Alto. They were what you’ll call blue collar and they still live in your neighbors.
As anon asks, what makes you a white collar? Your job? No, if you live in a dirt cheap place littered with pickup trucks, right? So, your education? Same thing. Your lifestyle and house location? No, since you could have a traditional blue collar job since the 70s and live comfortably in Saratoga. So, moving up to Palo Alto and buying a Porsche makes you a white collar family, suddenly? Is that what you’re reduced to assert?

Which brings up some interesting questions. What does it mean to be blue collar or white collar in Silicon Valley? Does it even apply?

Similarly, what is working class in Silicon Valley? What is middle class? What is professional class?

Here’s what the Mayor of San Jose had to say:

Wealth-Less Effect: Earning Well, Feeling Otherwise
Proposed Tax Increases on Six-Figure Earners Highlight Mounting Costs of Living — and the Relativity of Prosperity

San Jose, Calif., Mayor Chuck Reed calls a family living in Silicon Valley earning $250,000 “upper working class.” That is about what two engineers working at a technology firm can expect to make, but “a family earning $250,000 a year can’t buy a home in Silicon Valley,” he said.

James Duran owns a human-resources company in Silicon Valley and is president of the Hispanic Chamber of Commerce in California. He supported Mr. Obama, but is worried about the tax proposals. He has laid off some employees in recent months and has been wondering how he can fund an extension of those workers’ health-care benefits.

Mr. Duran said he and his wife earn about $400,000 annually, but “I’m barely getting by.” They have high property and state taxes, as well as college tuition and savings to cover. “I’m an Obama man, but this side of him is a difficult pill for me,” he said.

Is $400,000 for a 4 person family middle class in Silicon Valley? Is that white collar?

It sort of makes sense… after all, we’re a very very very special place with an mix of smart people that’s impossible to find anywhere else.

What class are you?

Comments (107) -- Posted by: burbed @ 5:27 am

April 23, 2009

Is Silicon Valley’s housing market ‘leveling off’? – San Jose Mercury News

Is Silicon Valley’s housing market ‘leveling off’? – San Jose Mercury News

Has the Silicon Valley housing market reached a bottom?

No one knows for sure, but figures released Thursday provide some tantalizing clues.

More Silicon Valley homes changed hands last month than in March 2008; it was the fourth consecutive month the county’s sales have outpaced their prior-year levels. And after months of big declines, the median price of the houses sold hovered in the low $400,000s for a third month in a row.

“What we are seeing is signs you would expect to see prior to prices leveling off,” said Andrew LePage of MDA DataQuick, a real estate information firm that released March Bay Area home sales figures Thursday. However, “given all the different countercurrents and all the uncertainty out there, you don’t want to point to three months and say, ‘Ah, we’ve hit bottom.’ “

Although Pralay sent this in a week ago, I figured I’d post it today so that people could spend some more time reflecting on this news, before commenting on it.

Personally, I know from the NAR radio ad (the guy digging, who hits a sprinkler) that you can’t find the bottom. It’s impossible.

But still, this is great news. Now, I might have been too optimistic last year with my predictions, but would I be so off to say that we can expect a healthy 9% YoY appreciationg in 2010? Then back to 15% by 2012 when green tech is in full swing?

Comments (30) -- Posted by: burbed @ 4:46 am

April 19, 2009

Median price of single family home in Mountain View remains at $1 million

Mountain View Voice : Home sales way down, but prices remain high
The median price of a single-family home in Mountain View remained just over $1 million in the first quarter of 2009, despite the fact that half as many were sold compared to the same period last year, according to the local Realtors’ association.

The trend is the reverse of what’s been reported in Santa Clara County overall, where sales have reached new heights in some areas as the county median for previously owned, single-family homes dropped from $716,500 in February 2008 to $421,000 in February 2009.

The Silicon Valley Association of Realtors reports that the median price of a single-family home in Mountain View was at $1,015,037 in the first quarter of 2009, down just slightly from $1,050,000 in the first quarter of 2008 and up from $946,500 in the first quarter of 2007.

Local median condo prices declined much farther, however, going from $645,000 in the first quarter of 2008 to $569,000 in the first quarter of 2009. That number is still higher than the $559,750 median reported in the first quarter of 2007.

Mountain View home sales are down overall: Only 33 condos and 20 single-family homes were sold in 2009’s first quarter, compared to 55 condos and 47 single-family homes in the same period last year.

City officials report that there were 40 foreclosures in Mountain View in 2008.

Blah blah blah. The most important part is to observe that the price of single family homes in Mountain View remains over $1 million.

If that doesn’t say Real Bay Area… I don’t know what does.

Let’s face it, this economic downturn has been painful in other areas, like Sunnyvale – but might I be so bold as to predict that the median will be $1.1 by the end of this year?

Comments (118) -- Posted by: burbed @ 5:59 am

April 17, 2009

American Journeys – Searching for Silicon Valley; a Place and a State of Mind –

American Journeys – Searching for Silicon Valley; a Place and a State of Mind –
That diversity is immediately apparent almost anywhere in Silicon Valley. You can see it on Castro Street in Mountain View, dotted with a proliferation of ethnic restaurants. Elsewhere, you can turn down a street seemingly at random and find the shop signs are all in Chinese or Spanish or Vietnamese.

Standout restaurants include La Costeña, a hole-in-the-wall grocery in Mountain View that has great burritos (and a Guinness World Record claim for making the largest), and Evvia in Palo Alto, which serves a spectacular version of arnisia paidakia, or lamb chops.

Congratulations to Silicon Valley for being featured in the New York Times travel section today.

In addition to our powerhouse tech/green tech industries, we now have a booming tourism industry.

I hope you’re having a great Friday, because I am! The stars are aligned for a major take off in Real Estate as more foreigners will soon be trying to snatch up vacation homes in Cupertino, Palo Alto, Mountain View, and other Real Bay Area cities. Who needs Cannes when you can have Campbell!

Comments (87) -- Posted by: burbed @ 11:00 am

April 12, 2009

Commercial Rent falling in San Francisco >> Local News
Companies including Pacific Gas & Electric Co., bankrupt law firm Heller Ehrman and health care provider Blue Shield of California already put 553,825 square feet of office space on the market in the first three months of this year, according to Colliers.

The available space will also soon increase as companies that have said they are putting offices on the market pack up, including Charles Schwab Corp., the largest independent U.S. brokerage by client assets, and Macy’s, the second-biggest department-store chain.

Charles Schwab is shedding 375,000 square feet at 120 Kearny St., and Macy’s is vacating 153,000 square feet at 22 Fourth St., Colliers said.

More layoffs appear to be on the horizon, with almost half of the largest companies in the Bay Area saying they plan to cut staff in the next six months, said John Grubb, spokesman for the Bay Area Council, which represents the region’s biggest employers, including
Chevron Corp., Google Inc., Yahoo Inc., Safeway Inc. and Wells Fargo & Co.

About 279,000 people in the region are looking for work, almost double the number from a year ago, Grubb said.

Yeesh. More doom and gloom from the ol’ main street media.

Hey San Francisco, with this kind of news… you might be at risk for being cut from the Real Bay Area.

But, there’s a silver lining:

The drop in rental prices is not just hitting the Bay Area. Rising unemployment and lower consumer spending are also cutting commercial rents in New York. First-quarter Manhattan office rents fell the most in at least 25 years, closely held commercial property broker Cushman & Wakefield Inc. said in a report.

Muhahahaha…. take that Manhattan! Take that!

Comments (10) -- Posted by: burbed @ 4:02 am

April 5, 2009

The Latest, Hottest, Bay Area magazine!

Thanks to Burbed reader Herve for making this:


You know you’d buy it if it were really available!

Comments (30) -- Posted by: burbed @ 5:47 am