Recently I’ve been working with many clients interested in purchasing condos. One client closed on a SilverCreek condo last week, a couple others wrote offers on condos, and the others continue to shop. Most of the prospective condo buyers with whom I’ve been working are purchasing these units as investment property to rent out, but a couple plan to occupy them.
Because of the increase attention to condos, I thought this would be a good time to post an updated medians table for condos and town homes.
As you can see, compared to the median data for site/stick built properties (SFRs), the monthly data for condos is much more variable. That being said, observed trends include:
- Units sold is holding steady
- Median sales price continues to decline
- Days on market is trending downward
- Sold price per square foot is at an all time low
…perhaps this is why I’ve had so many clients interested in purchasing condos recently.
| Month Year | # Sold | Sold Price | Sold Price per SqFt | Average DOM |
| Oct 2009 | 61 | $63,500 | $66.67 | 108 |
| Sep 2009 | 63 | $72,000 | $69.31 | 157 |
| Aug 2009 | 73 | $70,000 | $74.42 | 161 |
| Jul 2009 | 58 | $69,750 | $74.42 | 181 |
| Jun 2009 | 70 | $85,000 | $89.11 | 120 |
| May 2009 | 63 | $62,000 | $84.06 | 122 |
| Apr 2009 | 61 | $110,250 | $98.28 | 141 |
| Mar 2009 | 45 | $120,000 | $98.22 | 115 |
| Feb 2009 | 24 | $78,450 | $81.76 | 138 |
| Jan 2009 | 30 | $99,000 | $87.93 | 140 |
| Dec 2008 | 32 | $98,450 | $100.68 | 128 |
| Nov 2008 | 28 | $91,000 | $91.02 | 162 |
| Oct 2008 | 48 | $113,000 | $117.93 | 149 |
| Sep 2008 | 28 | $144,750 | $128.40 | 173 |
| Aug 2008 | 44 | $132,500 | $131.80 | 215 |
| Jul 2008 | 37 | $160,500 | $134.35 | 167 |
| Jun 2008 | 35 | $170,000 | $143.93 | 248 |
| May 2008 | 34 | $145,000 | $138.39 | 162 |
| Apr 2008 | 32 | $149,500 | $150.13 | 205 |
| Mar 2008 | 18 | $117,450 | $128.34 | 149 |
| Feb 2008 | 31 | $179,000 | $149.92 | 156 |
| Jan 2008 | 33 | $210,000 | $177.45 | 147 |
| Dec 2007 | 27 | $170,000 | $148.72 | 172 |
| Nov 2007 | 36 | $160,725 | $154.62 | 177 |
| Oct 2007 | 33 | $185,000 | $164.14 | 172 |
| Sep 2007 | 48 | $174,000 | $159.85 | 127 |
| Aug 2007 | 48 | $188,975 | $170.99 | 109 |
| Jul 2007 | 60 | $189,500 | $171.69 | 118 |
| Jun 2007 | 51 | $195,000 | $172.81 | 99 |
| May 2007 | 76 | $222,500 | $209.42 | 225 |
| Apr 2007 | 79 | $251,950 | $206.77 | 202 |
| Mar 2007 | 65 | $224,000 | $203.58 | 177 |
| Feb 2007 | 65 | $208,000 | $198.17 | 180 |
| Jan 2007 | 89 | $244,900 | $241.34 | 159 |
| Dec 2006 | 70 | $215,013 | $221.94 | 148 |
| Nov 2006 | 55 | $170,000 | $187.29 | 134 |
| Oct 2006 | 67 | $195,000 | $180.34 | 116 |
| Sep 2006 | 66 | $206,000 | $181.23 | 102 |
| Aug 2006 | 60 | $168,550 | $183.21 | 90 |
| Jul 2006 | 60 | $164,750 | $176.30 | 82 |
| Jun 2006 | 64 | $184,000 | $191.33 | 85 |
| May 2006 | 72 | $190,000 | $189.99 | 105 |
| Apr 2006 | 65 | $194,000 | $189.17 | 96 |
| Mar 2006 | 69 | $178,000 | $177.08 | 79 |
| Feb 2006 | 55 | $185,000 | $190.42 | 106 |
| Jan 2006 | 61 | $208,000 | $195.24 | 112 |
| Dec 2005 | 68 | $220,000 | $200.91 | 110 |
| Nov 2005 | 80 | $205,000 | $198.22 | 66 |
| Oct 2005 | 91 | $172,000 | $184.88 | 65 |
| Sep 2005 | 100 | $204,500 | $193.32 | 64 |
| Aug 2005 | 125 | $199,900 | $192.05 | 59 |
| Jul 2005 | 81 | $190,000 | $179.50 | 56 |
| Jun 2005 | 118 | $181,875 | $185.49 | 57 |
| May 2005 | 93 | $185,000 | $181.62 | 57 |
| Apr 2005 | 108 | $181,200 | $156.34 | 78 |
| Mar 2005 | 107 | $159,900 | $158.65 | 64 |
| Feb 2005 | 76 | $172,118 | $153.53 | 86 |
| Jan 2005 | 57 | $165,000 | $155.91 | 78 |
| Dec 2004 | 75 | $159,000 | $141.94 | 76 |
| Nov 2004 | 77 | $141,000 | $144.23 | 41 |
| Oct 2004 | 96 | $149,593 | $140.82 | 43 |
| Sep 2004 | 85 | $146,000 | $139.86 | 44 |
| Aug 2004 | 93 | $140,500 | $133.51 | 54 |
| Jul 2004 | 78 | $139,950 | $129.77 | 38 |
| Jun 2004 | 78 | $110,100 | $120.45 | 49 |
| May 2004 | 96 | $124,950 | $126.61 | 57 |
| Apr 2004 | 85 | $118,000 | $115.49 | 54 |
| Mar 2004 | 78 | $115,000 | $112.50 | 69 |
| Feb 2004 | 69 | $115,000 | $113.80 | 65 |
| Jan 2004 | 46 | $117,600 | unavailable | 68 |
| Dec 2003 | 52 | $115,000 | unavailable | 80 |
| Nov 2003 | 53 | $117,500 | unavailable | 80 |
| Oct 2003 | 48 | $112,250 | unavailable | 81 |
| Sep 2003 | 86 | $109,450 | unavailable | 62 |
| Aug 2003 | 69 | $89,900 | unavailable | 79 |
| Jul 2003 | 59 | $104,000 | unavailable | 70 |
| Jun 2003 | 56 | $106,000 | unavailable | 61 |
| May 2003 | 62 | $97,000 | unavailable | 60 |
| Apr 2003 | 59 | $92,000 | unavailable | 98 |
| Mar 2003 | 55 | $96,500 | unavailable | 80 |
| Feb 2003 | 45 | $94,000 | unavailable | 70 |
| Jan 2003 | 43 | $82,000 | unavailable | 79 |
| Dec 2002 | 42 | $96,140 | unavailable | 63 |
| Nov 2002 | 49 | $90,000 | unavailable | 88 |
| Oct 2002 | 59 | $89,500 | unavailable | 65 |
| Sep 2002 | 56 | $91,800 | unavailable | 65 |
| Aug 2002 | 60 | $91,500 | unavailable | 67 |
| Jul 2002 | 61 | $96,000 | unavailable | 85 |
| Jun 2002 | 53 | $87,500 | unavailable | 70 |
| May 2002 | 49 | $87,000 | unavailable | 65 |
| Apr 2002 | 42 | $85,700 | unavailable | 65 |
| Mar 2002 | 60 | $84,750 | unavailable | 86 |
| Feb 2002 | 35 | $81,950 | unavailable | 72 |
| Jan 2002 | 34 | $76,500 | unavailable | 73 |
| Dec 2001 | 43 | $88,000 | unavailable | 100 |
| Nov 2001 | 36 | $85,750 | unavailable | 77 |
| Oct 2001 | 44 | $80,500 | unavailable | 87 |
| Sep 2001 | 45 | $88,000 | unavailable | 72 |
| Aug 2001 | 63 | $92,000 | unavailable | 63 |
| Jul 2001 | 54 | $94,500 | unavailable | 105 |
| Jun 2001 | 56 | $80,250 | unavailable | 75 |
| May 2001 | 51 | $78,000 | unavailable | 93 |
| Apr 2001 | 54 | $78,750 | unavailable | 101 |
| Mar 2001 | 47 | $78,200 | unavailable | 80 |
| Feb 2001 | 39 | $84,900 | unavailable | 108 |
| Jan 2001 | 40 | $95,350 | unavailable | 111 |
| Dec 2000 | 37 | $65,000 | unavailable | 107 |
| Nov 2000 | 41 | $67,700 | unavailable | 96 |
| Oct 2000 | 42 | $86,750 | unavailable | 83 |
| Sep 2000 | 41 | $85,000 | unavailable | 108 |
| Aug 2000 | 51 | $85,900 | unavailable | 84 |
| Jul 2000 | 47 | $84,000 | unavailable | 121 |
| Jun 2000 | 54 | $79,500 | unavailable | 83 |
| May 2000 | 46 | $78,250 | unavailable | 109 |
| Apr 2000 | 44 | $72,500 | unavailable | 100 |
| Mar 2000 | 46 | $66,000 | unavailable | 122 |
| Feb 2000 | 49 | $82,000 | unavailable | 96 |
| Jan 2000 | 23 | $72,000 | unavailable | 96 |
| Dec 1999 | 38 | $83,750 | unavailable | 86 |
| Nov 1999 | 41 | $60,000 | unavailable | 102 |
| Oct 1999 | 53 | $78,500 | unavailable | 103 |
| Sep 1999 | 49 | $81,500 | unavailable | 125 |
| Aug 1999 | 49 | $79,900 | unavailable | 117 |
| Jul 1999 | 44 | $85,200 | unavailable | 103 |
| Jun 1999 | 42 | $85,450 | unavailable | 92 |
| May 1999 | 45 | $82,500 | unavailable | 105 |
| Apr 1999 | 39 | $90,000 | unavailable | 113 |
| Mar 1999 | 40 | $63,250 | unavailable | 116 |
| Feb 1999 | 36 | $82,000 | unavailable | 97 |
| Jan 1999 | 31 | $84,000 | unavailable | 103 |
| Dec 1998 | 34 | $81,250 | unavailable | 104 |
| Nov 1998 | 34 | $79,500 | unavailable | 87 |
| Oct 1998 | 44 | $79,000 | unavailable | 96 |
| Sep 1998 | 34 | $71,750 | unavailable | 91 |
| Aug 1998 | 39 | $76,900 | unavailable | 100 |
| Jul 1998 | 51 | $76,500 | unavailable | 80 |
| Jun 1998 | 62 | $79,000 | unavailable | 90 |
| May 1998 | 43 | $77,500 | unavailable | 87 |
| Apr 1998 | 39 | $79,500 | unavailable | 107 |
| Mar 1998 | 52 | $73,750 | unavailable | 106 |
| Feb 1998 | 40 | $76,750 | unavailable | 107 |
| Jan 1998 | 32 | $84,450 | unavailable | 118 |
Note: The median home price data reported above covers the cities of Reno, Nevada and Sparks, Nevada [NNRMLS Area #100]. Data includes Condo/Townhouse properties only. Data excludes Site/Stickbuilt, Manufactured/Modular and Shared Ownership properties. Data courtesy of the Northern Nevada Regional MLS - November 2009
26 comments
So the median price for condos is below where it was 13 years ago or more.
So much for real estate always goes up in the long run.
I guess there are not too many of them there fancy dancy Palladio and Montage $350 sq. ft. condos being sold these days.
If prices have only fallen 75% of the way to reaching normal value, as this article states http://finance.yahoo.com/tech-ticker/article/372877/House-Prices-Still-Have-A-Ways-To-Fall?ref=patrick.net Then I suspect we have a ways to go on the downside, as bubbles always end with prices well-below fair value.
So I guess the Silver Creek condo conversion hit the market just a little too late? How much were they originally priced at?
As a Bay Area native looking for a 2nd home in Reno, tired of waiting/scared of downtown/Montage at the moment. This place looks like it has already hit reality pricing. Lots of negative comments from couple years ago at apartmentratings.com, tho. Has it gone downhill from there or is it a viable 2nd home spot?
December and January — to me, those will be the big signals of where we are in this RE market. Up to this point, the data have been skewed by the tax credit and very low interest rates. The rush to get the tax credit ended as soon as the extension was announced. November will still benefit from the incentive. Dec-Feb, normally the slowest months of the year, will not.
At the low end, I’m keeping an open mind that the worse is behind us. The >$400k market, however, will continue to decline over the next 5 yrs. Little demand and few jobs to increase demand at that level.
So, if we have an unusually strong Dec and Jan, then I’ll concede that the market is on the mend, and the bottom may be behind us. If we tank in Dec and Jan, however, it will tell us that all this activity has been artificially induced, and will end as soon as the incentives cease.
Open question, though. It’s obvious that there is a mountain of foreclosures that the banks are holding back. Will the banks begin to foreclose on defaults at some point? Or, will they attempt a slow drip as they hope for the economy to mend?
Low risk action: Buy within the next 6 months at $300k or below, especially if you qualify for the tax credit. Wait 3-5 years if you really want that >$400k dream home in the neighborhood of your choice.
Rob,
I would give serious pause to those condos. I live not too far from there and had a look at them about a year ago. When I went through I noticed things like windows not latching due to poor installation and possibly settling. There were a lot of creaky floors. Also, I noticed a lot of chipped stucco from all the moving in an out while they were apartments. I think there was a lot of deferred maintenance going on as well since they knew they were going to sell them off. The parking lot was starting to crumble when I looked. I see big assessments coming. Nearly all of those condos sold for far too much so I see some a huge wave of foreclosures coming out of there which would also mean a lot of people not paying their dues which means a lot of things won’t get taken care of. At the end of last summer it looked like the landscaping was already going south. I wouldn’t touch the place for at least two years until things shake out down there.
Depending on how much you have to spend I would consider the condos down near Plumas and McCarran. A lot of the owners have been there a long time.
Here’s a SilverCreek story for you that illustrates the craziness of the market bubble.
I’ve got a family member who bought in 07 when she was 20 years old. She was going to UNR and making 6 bucks an hour as a waitress at the time, but the mortgage company gave her a loan anyway.
She bought her condo “on sale” for 30,000 less than what they had been asking. Essentially 160,000 for a 2 bedroom, 930 sq feet. Laughable now, but at the time it didn’t seem so crazy for someone who knew little about real estate. She couldn’t get a garage to go with it because they were 20,000 more.
Long story short, her payments are 1,250 a month for what is basically an apartment. You can find them for 800-850 a month for rent, so essentially she’s paying 400 more a month than renters for the same unit. Not to mention how underwater she is because the same units in foreclosure are listed in the high 70s, low 80s now.
She’s current on her payments and trying to get a mortgage modification but the company is just stringing her along. I don’t see much alternative for her other than just letting it go. Her credit will suffer, but there is no way that unit is going to regain its value in her lifetime.
First off, BB, could you perhaps come up with a different nickname? The reason being, people have been referring to me as “BB” for more than three years here. I’d like to clear up any confusion before it happens. Thank you in advance.
You posted:
“…her payments are 1,250 a month for what is basically an apartment. You can find them for 800-850 a month for rent, so essentially she’s paying 400 more a month than renters for the same unit. Not to mention how underwater she is because the same units in foreclosure are listed in the high 70s, low 80s now.
She’s current on her payments and trying to get a mortgage modification but the company is just stringing her along. I don’t see much alternative for her other than just letting it go. Her credit will suffer, but there is no way that unit is going to regain its value in her lifetime.”
So, in other words, it was fine in her mind to purchase a condo with a monthly payment which was 33% above fair market rent as long as prices were rising, but once she found out that real estate doesn’t always go up, all of a sudden it’s a problem? And, even worse, she wants a modification now? Did she plan on sharing the proceeds with the bank had her speculative “investment” gone up in value? Of course not. I don’t feel a bit sorry for someone so foolish, and I hope the bank leaves her out in the cold, which is exactly where she belongs. Cue up another foreclosure.
OK, didn’t realize there was someone with a trademark on those initials.
I’m sure she doesn’t need or want your sympathy, so save it. And I know that at age 20 you surely made every decision correctly based on the vast knowledge you gained in your previous 19 years (not including time in diapers, of course)
As for speculative investment, where would you like people to live? She wasn’t buying a million dollar house in Somersett, merely one of the lowest priced places in town at the time so she could have a place to call her own.
I really feel sorry for people like you. You should use your vastly superior knowledge to do something better for the world rather than bashing people on a real estate board.
Cure world hunger or something. I’m sure you’re up to the task.
CC- the tone aside BB (original) makes a good point and that is if she walks her credit should take a hit, and we don’t need to sympathize with her downside because she invested poorly, regardless of her age or business savvy.
If the free market was allowed to play out without government intervention we would realize a much faster recovery IMO. So she has a decision to make. Now she’ll realize there is a risk in every investment, and who knows, when she’s 30 she may make better decisions.
CC -
Just curious.
What did the “BB” stand for before you changed your moniker?
What kind of down payment was your 20 year old family member able to come up with on her $160K purchase? Assuming next to nothing, exactly how under water is she?
What kind of ARM did she secure? What’s the current interest rate [7%]?
Since you state she’s current in her payments, why is it you conclude her only option is to walk? How about keeping current on a payment she apparently can afford? How about getting a roommate who will help out with rent? How about you give her a loan [since you’re so concerned about her well being’ so she can refi now that mortgage rates are at historical lows?
So she was making $6 an hour as a waitress.
I’m curious, CC. Do you know what her loan application said? Do you know for a fact that she reported making $6 an hour on her app? Surely she did not get a liar loan did she? She told the bank she was making $240 a week (if she was working 40 hours)? Surely she did not report she was making $1000 a week in tips, or some such thing, did she? The bank really loaned her enough money to buy a $160K place on $6 an hour? Really CC?
Are you the one who signed up for the condo, CC? Given your defensive nature, I wouldn’t be surprised. You talk as if the purchaser is some sort of victim.
“As for speculative investment, where would you like people to live? She wasn’t buying a million dollar house in Somersett, merely one of the lowest priced places in town at the time so she could have a place to call her own.”
Don’t make me gag. There has never been a shortage of rentals, and people should live in places they can afford. As a 20 year old waitress making $6 per hour, she should be shacking up in an apartment with roommates, not signing loan docs on some ridiculously overpriced attached product.
I don’t begrudge people for making mistakes. I certainly forgive her naivete in her poor decision. What I do have a problem with is someone playing the victim, trying to make others pay for their own mistakes. That’s exactly what she’s trying to do by expecting some sort of loan forgiveness from the bank. She needs to learn a lesson, and that’s to either work hard and pay down that bloated loan, or go through a short sale or foreclosure. You seem to be stuck in the whole “coddling the victim” mode. Snap out of it and start acting like an adult.
Skrap you are right ahead of me. I’d love to see miss waitress’ loan application.
I can see it now. No doc, stated income, teaser rate. Maybe even an option-ARM. The magic of creative financing.
Surely this must be somebody else’s fault.
20 year olds making $6 an hour buying $160K properties. That’s just wonderful, ain’t it?
And how many of these are there out there getting ready to turn into next year’s foreclosures.
And yea, I’d like to see that loan app also.
i’m not going to pile on……it was a mania……it was irrational….i feel for her
where were her parents?
What gets me is the fact that this loan was made in 07, after the market was starting to decline and sub-prime was beginning its collapse. Maybe it was another Goldman Sachs deal that allowed this to happen.
This loan should not have happened in 07 period!
Happy Thanksgiving everyone!
I feel sorry for BB/CC’s niece. As to why people buy during an upswing, there is Barton Bigg’s observation during the tech mania that the fools were dancing but the bigger fools were watching. As for moral culpability, all the geniuses on WS didn’t see the real estate problem, so it’s hard to be too critical of a twenty year old not anticipating them. Maybe she watched TV and saw George Bush & Co. on Fox, or the real estate experts on CNBC, saying how fundamentally strong the economy was (not trying to be political, just pointing out what the conventional wisdom would have been).
On the morality front, why is it that morality only applies to working stiffs. How many Private Equity funds have borrowed billions — with taxpayer support — to take over companies, made a ton of money, and then liquidated the company when it became hard to make the payments. Or how about guys like Rick Waggoner who ran a company into the ground, and when somebody makes the obvious choice and gives him the boot you have all these commentators expressing their sympathies, even as he walks away with $18M. I have a neighbor in banking, and he is working with developers to help them restructure their loans. If that is OK, why is it such a moral outrage for some 20 year old to ask for the same thing?
I also feel sorry for BB/CC. Seems to be lot of negative reaction to a reasonable comment. No reason to drive people off.
On the substance, it’s hard to see how condo prices in Reno are not going continue their downward trend. The inventory overhang is large, so a whole lot of units will have to move before we see the bottom. Condos are generally not that stable an investment because supply can be increased in a relatively short period of time. However, as higher price units like the Montage come on the market it may be that the median price increases as a function of the quality, though real prices will have continued to fall.
DonC posted:
“I feel sorry for BB/CC’s niece. As to why people buy during an upswing, there is Barton Bigg’s observation during the tech mania that the fools were dancing but the bigger fools were watching. As for moral culpability, all the geniuses on WS didn’t see the real estate problem, so it’s hard to be too critical of a twenty year old not anticipating them.”
This is horsesh!t. Feeling sorry for someone because they lied on a mortgage application and took on debt for a depreciating asset which they can’t afford? We’d already been posting on this blog for a year about the impending price collapse when she bought the thing! It was plain as day what was going to happen, and the information was there for anyone who wanted to spend 10 minutes doing research.
And, don’t try to feed us this garbage that Wall St. didn’t see this coming. They knew EXACTLY what they were doing, and what the result would be. Just look at the recent admission by Goldman that they were betting on a collapse. My sympathy is reserved for the financially prudent first time buyers who were forced out of the housing market due to greedy speculators, and stupid people who bought crap they couldn’t afford.
Perry,
thanks for the first person view data point. Does seem like a steer clear since as a relatively new conversion, it is more likely to continue to head downward maintenance wise, particularly if it continues to be unsold/renters.
Bantering Bear,
I have to agree. Unfortunately, people don’t like to hear the stark reality and want an excuse for the criminal nature of what has taken place here. Those that have been prudent and conservative are being railroaded with zero percent interest rates on cash. These people of all else are at the top of my list for sympathy as ZIRP is complete lunacy. To give an example of what I did…I rented an apartment in River Walk Towers..Downtown Reno from 06-08′. Cost me about $24,000 total. Now if I went and bought a Fallen Leaf condo in the $300K’s or that River Walk Condo in the $200K’s, I would be down between $150-$200K right now in equity…So I figure I am up well over a $100K in savings from renting..How about dem apples….Who says renting is not the prudent thing to do.
WG- you made a good decision at a time when most weren’t. Since I don’t know your situation I’ll assume you had options and chose well. Did you research this or was it luck? If you researched it maybe you could let us in on other money making insights you have.
Either way, is the 20 year old’s decision so wrong when our government will allow this to happen? Maybe you need to pass a test to buy a house? Some type of aptitude test? Oh wait, it’s called qualifying that’s right. So we blame the 20 year old because she was able to qualify.
We should feel sorry for her. If only because we’ve collectively allowed this to happen.
Come on guys. Do we really, really think this 20 year old college student, first time homebuyer, made the decision to purchase/finance on her own? Those of you who’ve owned real property before - how old were you when you made your first purchase? Were you still in school? Were you single?
I submit our poor naive waitress had some “help.” In fact, I’m thinking help may even have come from family colleague CC. And maybe he’s so concerned with her situation [never in her lifetime will her condo regain its initial purchase price] because he’s the one who got her into this mess in the first place?
If CC didn’t help right from the start, where was he during all of this given his concern for our waitress’ well being? Why didn’t he stop her from making a big mistake? Or if he didn’t learn until after the fact, why didn’t he help her sell during the next year after her purchase [after all, CC states she was able to purchase for arguably, $30K under fmv]?
In my mind, our waitress is someone who relied upon others more experienced and knowledgeable than she and is to be forgiven. And maybe that’s the lesson to be learned - if it just doesn’t seem right for a 20 year old to be able to purchase a home with essentially no money down and purchase money financing given to someone we all know can’t qualify based upon a $6/hour job, IT ISN’T!
Well, the 20 year old Waitress probably makes about 1k per month on tips alone..
Being she is current on the payment probably means she does well on tip income, most of the time not put on a loan application or not used by the lender unless its on a W-2 form
Being the 20 year old had the common sense of trying to buy a condo at 20, means to me she has more common sense then 90% of people in her age group.
Condo financing is as tough as it ever was, being the huge amount of foreclosures no one wants to touch a condo right now..
Will values go back up..sure will they hit the levels in the crazy years..probably not for a long time..
I was about the same age when I bought my first condo on the peninsula. But the dollar amounts where much smaller back then.
.
Thanks JJ for clearing up her income level. No waitress/waiter in this country makes $6 an hour. Just ask the IRS. And what is a liar loan? The word liar implies that 1 party in the transaction put one over on the other party. A persons income is the easiest thing in the world to check. People are more successful at hiding income rather than fabricating income. It’s been said on this blog/website that this young lady lied on her loan. About what would she lie? That she made 50,000 a year. That she really worked in another profession? Both easily verified. No, she got the loan because the lender was willing to give her a high risk loan. Now if you want to make the case that the average citizen should look out for the banks and not apply for and accept these loans, I’m right with you. But how many people are really going to do that when the money starts flowing and everyone is upsizing? No, the answer should be that the bank needs to completely accept the risks of each and every loan it makes. Does anyone out there see any political will for that in the offing? It looks like we are headed in the same direction that got us where we are today. That being the case I’ve now reached the point where I can say I’m more bearish than Bantering Bear. Just call me the Babbling Kodiak.
BB and Smarten,
You hit the nails on the head. Sorry, folks, but if she gambled and won (condo price went up), you’d never hear peep from her and certainly she’d not split it with the bank. That she gambled and lost (regardless of income or who put her up to it) and now wants the bank (i.e. shareholders, taxpayers, depositors) to give her a special loan mod before she even defaults, well, that’s a 1-sided coin, now isn’t it?
CC,
I’m just glad you did not choose CL as your new moniker….
DonC,
Sorry, you are well meaning in many ways, but miss the point in a substantial way. This lady and her thinking, despite all the culpability on the part of mortgage lenders, lenders, and ‘advice’ from friends/family, simply needs to go under water so the market can eventually clear.
CC,
If you are a long time reader here, you’ll recognize we are a no-holds-barred bunch. Pray tell, what is her story? Was she co-signed? Did she have real, demonstrable potential upside in income or was she pretty much an over-aggressive $6/hr worker trying to game the system? Or, did she put substantial money down only to lose out via an unexpected circumstance? What was the background story and tell us why we should have any sympathy (fine if its legit, but tell us why?).
Happy thanksgiving, all.