Fraud in Charm City why paying 300k for a rowhome in idiotic due to fraud
Ed over at the city paper has been pretty busy lately doing a lot of investigative reporting on the BS going on in Canton, Fells Point, and Federal Hill and why you need to wait till houses come down to 2000 price levels before buying. (Realtors please do not email me crying because the gig is up you are a bunch of hucksters that need to explain to sellers that a 1300sq/ft rehab is only worth 180k, not 300k)
Take a look here at this amazing amount of fraud on Madeira Street. This just sickens me at how much of this bubble was total fraud on the part of the realtors, appraisers, and mortgage brokers.
This was an industry all its own in the downtown area. This is not the only street either. This was extremely common as everyone thought they were going to get rich and keep 100k plus earnings a year but selling each other houses.
But just like all bubbles the ponzi scheme ends and now we have a contraction of 70% of the businesses. In 2 years I bet that we have only 1/3 the amount of realtors left in the downtown area. The mortgage brokers are now gone and the appriasers left are under such a microscope and pressure from the banks to comp down that they are making less than half of what they were before.
I'd recommend anyone thinking of buying now take a look. This will explain why waiting 2 years for the bottom to fall out makes sense. Till then rent for cheaper than it costs to buy.
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Someone should find a way to do this in other neighborhoods. See how many other rings of related scammers there are. And where are the cops?
FYI
price drop accelerates; average is below 2005 level
The decline in home prices in the Baltimore metro area accelerated last month - the average fell below the 2005 figure - but the hemorrhaging in sales came to a near-halt.
The average sale price in Baltimore and its five surrounding counties dropped to about $296,000, according to numbers released yesterday by Rockville-based Metropolitan Regional Information Systems.
That's down nearly 6 percent from a year ago. And it's $7,500 less than sellers got in September 2005, at the height of the buying frenzy.
.
Why is everyone here rejoicing the price drops, wonders me. None was buying with own dough anyways. You happy dark folks who love to read such news - why didn't you take the loan and purchased the house??? YOU'RE FINANCING OTHERS DOING EXACTLY THAT VIA THE BAILOUT ;)
Hey anonymous - just a hunch but perhaps they would like to have a shot at actually OWNING a home someday.
As opposed to paying really high rent and living check to check just waiting for a job loss to push them into default?
Does the bank also provide the money for the monthly payment?
Why would I want to pay 2500 a month when I can wait and pay 1500?
Hey anonymous, people who took the loan and purchased houses they couldn't afford aren't getting bailed out. It's the banks who are getting bailed out. Joe-shmoe who bought a 500K house and can't make payments on it anymore is still going to loose his house to foreclosure unless he's lucky enough to sell it at a small loss.
Sounds like your just bitter you bought a house for thousands more than the value is now.
Need more cops to bust the scammers.
unfortunately, rents are creeping up too. Still cheaper than buying, but with other rising costs, those of us caught in the middle are being squeezed pretty hard.
http://seattlepi.nwsource.com/business/382860_mortgagecrisis11.html
http://www.nytimes.com/2008/10/19/washington/19fbi.html?_r=1&scp=2&sq=FBI&st=cse&oref=slogin
the regulators and cops, snoozing.
More garbage from Mr. Mortgage:
http://mrmortgage.ml-implode.com/2008/10/20/socal-home-sales-you-cant-read-the-headlines/
Let me translate:
He said...
"Today, the daytime financial market variety shows are simply giddy over the DataQuick report saying ‘SOUTHERN CA HOME SALES ARE UP 65% OVER LAST YEAR’.
Sorry to rain on the pom-pom parade, but how I see it home sales worsened yet again last month. Let me explain."
Translation...oh shit, a bottom is forming, let me spin the numbers to show a worsening picture so I will not lose any readership or advertising $$$
He said...
"First off you can’t compare last year with this year. It would be like comparing loan originations. It is a meaningless analysis. However, you can compare the past three months, which were all down from near 40k statewide in July, to 37k in Aug and 36k in Sept. That trend is lower. This is especially weak considering Oct through March are the weakest months for housing."
Translation: When YOY numbers dont show the slant you want, use MOM numbers (just like the realtors do). Also, this article is about SOCAL sales. His MOM numbers trending down are for the whole state. MOM numbers in SOCAL are UP!!!
He said...
"Now, let’s talk about real ‘organic’ sales and not foreclosure-related sales, as organic sales are at all-time multi-decade lows."
Translation - when is a sale not a sale, when it doesnt show what I want it to show. Look douchebag, a foreclosure sale is still a sale.
He said...
"Sept 2008 SoCal organic sales are down 66% from three years ago. This goes to show in living color how bad off the housing market actually is."
Translation - 3 years ago would be Sept 2005. Why were sales up in 2005? Aah yes THE BUBBLE! Sales should be nowhere near where they were during the bubble. To even point this out (as if Sept 05 sales are somehow healthy) just shows how biased he really is.
He said...
"Additionally, more than 10k homes in SoCal entered the foreclosure process or were actually foreclosed upon during the month of Sept meaning the problem is getting worse because more inventory is coming in than going out."
If you read the article and do the math, it looks like there were about 10,300 foreclosure sales in Sept, meaning it isnt getting worse, its a wash at best. Second, his 10K number is for (a) in the foreclosure process and (b) actually foreclosed upon. This number is prone to doublecounting as most houses go through both stages. This is a minor transgression but still he should know better.
BOTTOM LINE, this guy is a predator who preys on peoples hopes and dreams of armageddon. Some blogs, which are normally negative, took this to be a positive. I trust them in that they see negatives as negatives and positives as positives. Mr. Mortgage wont do that. In his world negative news is negative news and positive news is "really negative news too, you lemmings just need to listen to me".
ADAM & KEVIN...Im not saying you shouldnt cite this guy. He has some good data. Thing is the NAR has good data too, its just their slant that we could do without. Thus, just like you should take anything the NAR says with a grain of salt, you have to do the same thing with anything MR. MORTGAGE says.
rents are not creeping up. That is BS. I just renewed my lease for a year and got a $200 off a month discount. That's 2400 less than last year.
I basically told him either you do this or I leave and you try and rent it out. It might take months to get someone who can show up with cash for a deposit and has a good credit rating. He knew I had him by the nuts as all the apartment complexes are renting for less than last year as they are competing against the shadow market of people that cannot sell and have to move.
Just in downtown Baltimore alone there is thousands of new high rise apartments sitting empty for 2 years because they were priced with the idea that 2500k a month row homes was "normal". Rents will go down for the next 2 years as incomes go down. They will stabilize before house prices but till incomes go up rents will stagnate.
Despite your opposition towards them, you've been listening to the realtors' blather for too long.
Stop calling them rowhomes. They're rowhouses.
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