Archive for June, 2011
By DAVID STREITFELD and MEGAN THEE-BRENAN
Published: June 29, 2011
Owning a house remains central to Americans’ sense of well-being, even as many doubt their home is a good investment after a punishing recession.
Nearly nine in 10 Americans say homeownership is an important part of the American dream, according to the latest New York Times/CBS News poll. And they are keen on making sure it stays that way, for themselves and everyone else.
Support for helping people in financial distress over housing is higher than support for helping those without a job for many months.
Forty-five percent of the respondents say the government should be doing more to improve the housing market, while 16 percent say it should be doing less. On the politically contentious issue of direct financial assistance to those having trouble paying their mortgages, slightly more than half of those polled, 53 percent, say the government should help. And almost no one favors discontinuing the mortgage tax deduction, a prized middle-class benefit that has been featured on some budget-cutting proposals.
President Obama, who has been criticized for both doing too much to help the housing market and for not doing enough, was given poor marks. Only 36 percent of those polled approve of what Mr. Obama has done, while 45 percent disapprove.
In assessing blame for the housing crash, people are increasingly seeing financial institutions as the central culprit. Amid the swirl of recent disclosures about banks following improper and illegal procedures in pursuing foreclosures, 42 percent blame lenders, while 29 percent blame regulators. When the question was asked in early 2008, as the crisis was still building, the numbers were reversed, with 40 percent blaming regulators and 28 percent blaming lenders. Only a handful of respondents at either moment blamed the borrowers themselves for taking loans they could not afford.
“I believe the financial institutions willingly and knowingly allowed people to apply and receive credit at a rate higher than they could afford and this has degraded our economy,” said Steven Goode, an environmental health manager in Las Vegas, in a follow-up interview.
Making an offer for a house, something often done in past generations with little apprehension, is now riddled with worry. Only 49 percent call it a safe investment, while 45 percent feel it is risky. In a market where prices are consistently dropping, there is no easy exit.
“For the average person, it might not be a good idea today to buy,” said another respondent, Beth Lovcy of Troutdale, Ore., who bought a year ago. The value has already shrunk, but Mrs. Lovcy is unfazed. “It works out better financially than renting now because we can claim the interest on the mortgage.”
As the housing market slumped over the last few years with a speed and magnitude not seen since the Great Depression, aspects of homeownership have been debated as never before. There are tough questions about the role the government should take. These include how much of a down payment lenders should demand, whether lenders should be restrictive or expansive in granting new loans, how much assistance to give those on the verge of foreclosure, and whether real estate will ever again be the retirement savings vehicle it once was.
While the debate has been loud, there was little evidence of people’s views that went beyond the anecdotal. This poll offers a window onto widespread opinions at a critical juncture.
Before the crash, housing was widely deemed one of the safest possible investments. Few experts thought there was the possibility of a nationwide downturn. But after it happened, the effects were widespread and painful.
Diane Sherrell, a substitute teacher in North Carolina who retired on disability, traded up to a bigger house four years ago to accommodate an adopted son. “It’s been very difficult since then and we’re barely making it,” she said.
Half of those surveyed say the market’s continuing downward spiral has affected their long-term plans. One in five people say the crisis has prevented them from moving to another city or taking a different job. Nearly one-quarter of homeowners say their home is now worth less than what they owe on their mortgage, a condition known as being underwater. Families in this predicament are much more prone to foreclosure if they suffer job losses or other setbacks.
Over all, people are bleaker about the economic outlook than those surveyed in October. While most still think the current downturn is temporary, those saying it is permanent rose to 39 percent, up from 28 percent.
In the last two years, the stock market has recovered strongly while house prices have gone sideways at best. Yet those polled dismissed stocks as a long-term savings vehicle in favor of a savings or money market account (22 percent), a house (26 percent) or a 401(k) or individual retirement account (41 percent).
Who should be helped to buy is another contentious issue. Whether buyers need to come up with a 20 percent down payment — the standard for decades, but beyond the reach of many families now — is hotly debated. Fifty-eight percent of respondents say lenders should require this, while 36 percent say they should not.
People who cannot pay their mortgage are foreclosed upon. If they can pay but feel that doing so is pointless on a property that has lost so much of its value, it is called strategic default. While two-thirds of Americans say strategic default is not justified, 28 percent think that it is.
When houses are abandoned for any reason, it causes trouble for the neighbors. Three-quarters of those surveyed say foreclosures are a problem in their communities.
“Our home is worth much less now because houses are foreclosing around us,” said William Mack, an assembly line worker in Taylor, Mich.
Beyond all these ills, however, a persistent belief endures that the market will eventually improve and housing will regain its traditional importance.
Donna Boyd, a transportation supervisor in Cuyahoga Falls, Ohio, acknowledged “it might take a long time” for property values to go back up.
“But I don’t think I’m throwing my money away,” she said in a follow-up interview. “I rented for years when I was younger, and I just don’t like the idea of putting money in someone else’s pocket for something I will never own.”
The nationwide telephone poll was conducted June 24-28 with 979 adults and has a margin of sampling error of plus or minus three percentage points for all adults.
Marina Stefan and Marjorie Connelly contributed reporting.
A version of this article appeared in print on June 30, 2011, on page B1 of the New York edition with the headline: Despite Risks, Owning a Home Retains Its Allure, Poll Shows.
Kim and I just returned from a week in Mazatlan. It was wonderful! We bid on a silent auction item recently at a benefit and actually won. We were committed so we rounded up our air miles and flew through Houston to Mazatlan last Monday.
After a 40 minute ride from the airport, we arrived at our accommodation, the Inn at Mazatlan, a time share facility. It had 220 suites. Ours was on the 8th floor with a fabulous beach view. We had one bedroom, 2 bathrooms, a kitchen, sitting area, and a large balcony. The facility was well cared for. It featured 2 swimming pools with a waterfall in addition to 2 hot tubs.
The Papagayo Restaurant served breakfast, lunch, and dinner. The food was above average but we enjoyed sampling the excellent local restaurants including Pancho’s, Topolo, and Pedro y Lola, which had an excellent jazz/blues singer and bass player.
The Inn at Mazatlan is in the Golden Zone, about 5 miles north of Old Mazatlan. We traveled to Old Mazatlan several times via the local transportation, the Pulmonia, shown below. This an open air taxi and is loads of fun. Bargain for fares before getting in. The roughly 60 pesos we paid to travel from our hotel to Old Mazatlan was very reasonable.
We loved the beach at Mazatlan. The body surfing and boogie boarding was awesome. We had great weather all week and found the heat not oppressive. We have visited several beach communities in Mexico including Cancun, Playa Riveria, Cabo San Lucas, and Mazatlan. We found Mazatlan to be our favorite.
Vail, CO Colorado
When Club at Cordillera owner Wilhelm and the Wilhelm Family Partnership refused to open three of Cordillera’s four golf courses this summer, he breached his contract with club members, according to a lawsuit filed last week in District Court.
The lawsuit says, in effect, that Wilhelm took up to $8 million this year to run golf courses, then announced he’d keep the money but not open the courses.
“After … he had collected the annual dues for 2011, David Wilhelm announced in an email to club members that he would not open all the golf courses but would close three of the four golf courses and their associated clubhouses,” the lawsuit said.
Cordillera’s membership plan calls for access to four golf courses and facilities.
And that is where Wilhelm could end up on the hook for up to $100 million in membership deposits, as well as the $8 million in this year’s dues.
“If he has materially breached all of those membership agreements, and the club no longer exists as we have known it, we want our membership deposits back,” said Cheryl Foley, the lead plaintiff in the lawsuit filed last week.
In their lawsuit, the plaintiffs produced emails in which Wilhelm promised that, “We will open and provide members access to all four golf courses, clubhouses and related facilities in 2011.”
They produced an email in which Wilhelm said, “We understand this has been a concern for many of you and we trust that this will allay any fears or reservation you may have.”
But in May, Wilhelm slapped a $96.5 million lawsuit on Cordillera’s property owners associations, the Cordillera Transition Corporation and several individual property owners. Wilhelm asserted that they were conspiring to squeeze him out of the Club at Cordillera.
The next day, Wilhelm announced he would not open two of Cordillera’s four golf courses. The maintenance crews, dozens of people, were all fired that morning.
“He promised everyone in an email that if we paid our dues he’d open the courses, but then he just changed his mind, which just doesn’t seem nice,” Foley said.
Dozens of jobs were lost – both permanent and seasonal – and families were devastated when Wilhelm refused to open the golf courses, Foley said.
The Cordillera Metro District’s bond ratings were lowered in the wake of all this, which will make it more costly for them to borrow money.
“This is not right,” Foley said. “It’s unfair and it’s someone in a position of power exercising that power over people who cannot fight back.”
“If we can all do our little part to help them, then that’s what we’re going to do,” Foley said.
The property owners, led by Foley, an Edwards local, and four other Cordillera residents, won a victory last week when District Court Judge Fred Gannett issued a three-phase ruling on their behalf:
• Wilhelm is banned from spending membership dues money on anything except “the necessary maintenance and operation of the Club’s four golf courses and related facilities.”
• A certified public accountant will audit Wilhelm’s books every month.
• The property owners and plaintiffs get to approve the accountant.
“Cordillera Club members obtained a temporary injunction requiring the appointment of an independent accountant acceptable to the members to monitor the expenditure of funds from the dues account, and to perform an accounting,” said Brett Heckman, their attorney.
The lawsuit is filed not only by the five named plaintiffs, but also “on behalf of all others similarly situated,” which leaves open the possibility of a class action lawsuit against Wilhelm.
“It’s something we are continuing to discuss. It’s our intention to protect everyone who paid their dues and their membership deposits,” Foley said.
Staff Writer Randy Wyrick can be reached at 970-748-2935 or firstname.lastname@example.org.
Vail Resorts – For Immediate Release
Beaver Creek, Colo. June 17, 2011 –Beaver Creek is known for having one of the toughest downhill race courses in the world during the winter. On June 25-26, more than 10,000 competitive spirits will descend on the resort to participate in one of the “toughest events on the planet”, Tough Mudder. Combining the resort’s mountain lifestyle complete with top notch guest service, a championship golf course, three rejuvenating spas rated among Condé Nast Traveler’s Top 100 Spas and a plethora of gourmet and casual culinary options for refueling, there’s no better place to test one’s true grit and push mental and physical limits, among a bonded group of like-minded souls.
“Hosting Tough Mudder at Beaver Creek provides the perfect opportunity to use the natural terrain offered on the mountain as a backdrop for an all-out blood, sweat and tears challenge combined with a village that pampers and rewards all who visit with its intimacy, friendliness, guest service and laid-back feel,” said Tim Baker, executive director, Beaver Creek Resort Company. “We’re excited to welcome the more than 10,000 participants who will give it their all and then relax and soak in the true spirit of camaraderie and summertime in the mountains.”
The Beaver Creek Tough Mudder event features a nine-mile obstacle course designed by British Special Forces complete with 26 challenges set across the lower portion of the mountain that test all around strength, stamina, mental grit and camaraderie. In total, participants are expected to tackle 4,200 feet in elevation changes in two-and-a-half hours and with staggered start times throughout each day. Watch all the excitement and cheer participants on as they encounter hills, snow, mud, water, ropes, fire and 10,000 volts of electricity set among obstacles with names such as Boa Constrictor, Kiss of Mud, the Gauntlet, Funky Monkey and more.
For those opting to cheer on the challengers, the Buckaroo Express Gondola will be open June 25-26 from a 9 a.m. to 3 p.m. each day providing complimentary rides and transporting spectators to prime event viewing at The Ranch. A variety of obstacles will be located in and around the area accessed by the gondola and spectators can refuel at the Chuckwagon, which will serve food and refreshments at The Ranch all weekend long.
A dedicated spectator shuttle also will be operating from 8 a.m. to 6 p.m. Saturday and Sunday transporting friends and family from the Covered Bridge in the Village to Red Tail Camp. Beaver Creek offers complimentary parking in the Elk, Bear and Wolf Lots and shuttles will run daily beginning at 7 a.m. from the parking lots to the Village. The Avon shuttle will have various pick up points in the town of Avon and then drop guests off in Beaver Creek Village both days.
The Centennial Express Lift (#6) also will operate as usual from 9:30 a.m. to 4:30 p.m. for some fun in between event viewing and Spruce Saddle Restaurant’s delicious barbeque fare will be available from 11 a.m. to 2:30 p.m. A lift ticket or pass is still required to ride the Centennial Express Lift.
For more information about Tough Mudder and the summer’s event lineup visit www.beavercreek.com.
Sales are up in Beaver Creek but average sales prices have started declining again after nearly a year being stable. Is this a temporary trend?
The Bachelor Gulch Ritz-Carlton Hotel in Foreclosure? A huge new housing project in Eagle? Click on the links below to view the latest market update and the current BC condo and townhome listings and 2011 sales.
Summer has arrived (finally) in the Vail Valley. The Beaver Creek Blues, Brews, and BBQ weekend was a great success as always. The Teva Games in Vail attracted over 10,000 guests. Reservations are up across the Valley. All good news for our local real estate market.
The latest numbers we are seeing in the National and Local real estate markets are pointing towards a double-dip recession. Locally, the number of properties that went under contract in May was down from last year. We are also seeing prices in neighborhoods that had stabilized start to drop again. We are seeing fewer active buyers in the market. That does not bode well for our summer selling season.
Nationally, the Case-Shiller Index shows prices falling again across the nation after an uptick earlier in the year. In addition, builders are not showing any confidence in the recovery (see the story below). Personally, I have seen close friends leave the Vail Valley for greener pastures, real estate brokers who were able to earn a living selling real estate turning to other professions, and too many clients losing their homes to foreclosure. This is a recovery?
June home builder index falls to nine-month low
By Steve Goldstein
WASHINGTON (MarketWatch) — The already-weak index of builder confidence for new single-family homes fell 3 points in June to 13, the lowest reading since Sept. 2010, according to the National Association of Home Builders/Wells Fargo Housing Market Index. Economists polled by MarketWatch had expected a 16 reading. “Builders are being squeezed by the continuing weakness in existing-home prices – against which they must compete — as well as rising material costs,” said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. The worst-ever reading was 8 in Jan. 2008, and the gauge hasn’t been above 50 since April 2006. The HMI is a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
The Vail Valley is a quirky real estate market to say the least. Sellers don’t want to believe the market has dropped as far as it has. Our peak was so high that the valley was bound to be very deep. We are seeing prices dropping back to the same range we saw in the early 2000’s. So most anyone who bought real estate in the Vail Valley since 2002 will be selling below what they purchased their property for.
Now the hard part. What do you tell sellers looking for a real estate broker to represent them when selling their property? You certainly want to get the listing. That’s how we make our living. But you also don’t want a listing that will sit for a year or two without selling, causing the broker to spend money on marketing and the owner to lay awake at night wondering why their property isn’t selling.
Quite frankly, this market is mostly if not all about pricing. Buyers either want the exact property they are searching for or a screaming deal.
Some brokers will tell sellers anything to get the listing then figure they will hang on to it until the seller gets tired of the property and finally lowers the price to get it sold. Other brokers will “guarantee” a sale if they get the listing based on their marketing or their company’s history in the Valley.
Honestly, there is no “silver bullet” that gets a property sold, except maybe pricing it below the competition. Most sellers don’t want to hear that but brokers all market properties in roughly the same manner and, the truth is, that another broker will bring the buyer 95% of the time.
I believe that the brutal truth is the best policy. I work hard to stay on top of my local market and have a pretty good idea what price it will take to sell a property. I also believe I work harder than 95% of the brokers in the Valley and communicate with my clients on a weekly basis keeping them in the loop if the market changes. But being honest has cost me listings. Ultimately, I watch listings I’ve lost finally drop their price to what I originally recommended, but after months and months of trying to get it sold, increasing the cost to the owner.
Maybe I should reconsider my strategy for getting new listings. No……….I want to be able to sleep at night, even if in the short-term it costs me money.