Jump to content
House Price Crash Forum
Sign in to follow this  
DataMonkey

What To Do With Repossessed Properties

Recommended Posts

Fannie Mae, the largest U.S. mortgage finance company, couldn't find a buyer who would pay $6,900 for the three-bedroom house at 1916 Prospect St. in Flint, Michigan. So broker Raymond Megie, who is handling the foreclosure sale, advised cutting the price to $5,000.

Megie still couldn't sell it. ``There's oversupply,'' he said. The home sold in 2005 for $110,000.

Link to full article here

Maybe this is what we have to look forward to in a few months: banks unable to shift repossessions which cause a drag on their business. Does anyone still think that we're over the worst of the credit crunch? This is doubly relevant given the disastrous results at the Harman Healy auction earlier today.

Share this post


Link to post
Share on other sites
Fannie Mae, the largest U.S. mortgage finance company, couldn't find a buyer who would pay $6,900 for the three-bedroom house at 1916 Prospect St. in Flint, Michigan. So broker Raymond Megie, who is handling the foreclosure sale, advised cutting the price to $5,000.

Megie still couldn't sell it. ``There's oversupply,'' he said. The home sold in 2005 for $110,000.

Link to full article here

Maybe this is what we have to look forward to in a few months: banks unable to shift repossessions which cause a drag on their business. Does anyone still think that we're over the worst of the credit crunch? This is doubly relevant given the disastrous results at the Harman Healy auction earlier today.

you can't use the Michigan homes as an example, even for other parts of America.

The area is likely pretty bad, and as the article says, it's got no plumbing, carpets etc.

probably vandalized a bit for good measure, but you might be able to return some of the scattered beer cans laying around for the deposit.

Share this post


Link to post
Share on other sites
you can't use the Michigan homes as an example, even for other parts of America.

The area is likely pretty bad, and as the article says, it's got no plumbing, carpets etc.

probably vandalized a bit for good measure, but you might be able to return some of the scattered beer cans laying around for the deposit.

I am not an expert on America but I opened a link to properties for sale in america a while ago that was being punted as an investment.. basically they were old wooden homes in buffalo (doesn't seem the most salubrious are) and going or $60k ish with rental coming in at around $7,000... all sounds great 10% plus yield etc, until you start thinking that a new kitchen and bathroom etc a few years down the track plus maintnance to the wooden faced structure and insurance etc is going to cost a bomb and I doubted at the time that capital values would grow (they clearly havent').

There are too many houses in America otherwise a lot (most by a long chalk) would have found a bottom before now through rental yields.. the example of house being bought for $110000 and then struggling to find a buyer at $5000 suggests its valueless and can't be rented... if it could be rented for say $500 per month then you'd reckon it would sell for around $60000 as a bottom price. Fortunately in england most of our housing stock would rent (as long as there are renters out there which I suspect there will be) so whilst we'll some drops (and some of the new build flats may drop stratospherically) there will be some sort of floor beneath it.. I would say at something like 10 times rental (which is probably a good distance below where things will actually end up).

Share this post


Link to post
Share on other sites
I am not an expert on America but I opened a link to properties for sale in america a while ago that was being punted as an investment.. basically they were old wooden homes in buffalo (doesn't seem the most salubrious are) and going or $60k ish with rental coming in at around $7,000... all sounds great 10% plus yield etc, until you start thinking that a new kitchen and bathroom etc a few years down the track plus maintnance to the wooden faced structure and insurance etc is going to cost a bomb and I doubted at the time that capital values would grow (they clearly havent').

There are too many houses in America otherwise a lot (most by a long chalk) would have found a bottom before now through rental yields.. the example of house being bought for $110000 and then struggling to find a buyer at $5000 suggests its valueless and can't be rented... if it could be rented for say $500 per month then you'd reckon it would sell for around $60000 as a bottom price. Fortunately in england most of our housing stock would rent (as long as there are renters out there which I suspect there will be) so whilst we'll some drops (and some of the new build flats may drop stratospherically) there will be some sort of floor beneath it.. I would say at something like 10 times rental (which is probably a good distance below where things will actually end up).

If they can't even get $5000 for it, it probably is in a state that it would take 50,000 to bring it up to rent-able condition.

Michigan has been having real problems with whole neighborhoods being gutted by repossessions, then vandals and irate former owners.

there are still enough property bulls around (hard to believe) that if there was anyway that it was halfway livable, someone would have picked it up for 5000.

Share this post


Link to post
Share on other sites

http://en.wikipedia.org/wiki/Michigan#Economy

The Michigan economy leads in information technology, life sciences, and advanced manufacturing. Michigan is commonly known for its auto industry. Michigan ranks fourth nationally in high-tech employment with 568,000 high-tech workers, including 70,000 in the automotive industry.[26] Michigan typically ranks second or third in overall research and development expenditures in the United States.[27] Its research and development, which includes automotive, comprises a higher percentage of the state's overall gross domestic product than for any other U.S. state.[28] The state is an important source of engineering job opportunities. The domestic auto industry accounts directly and indirectly for one of every ten jobs in the U.S.[29] Some of the major industries/products/services include automobiles, cereal products, information technology, aerospace, military equipment, copper, iron, and furniture. Michigan is the third leading grower of Christmas trees with 60,520 acres (245 km²) of land dedicated to Christmas tree farming.[30][31] The beverage Vernors was invented in Michigan in 1866, sharing the title of oldest soft drink with Hires Root Beer. Faygo was founded in Detroit on November 4, 1907.

Michigan has experienced economic difficulties brought on by volatile stock market disruptions following the September 11, 2001 attacks. This caused a pension and benefit fund crisis for many American companies, including General Motors, Ford, and Chrysler. The American auto companies are proving to be more resilient than other affected industries as each company implements its respective turnaround plans (In 2007, General Motors reported a $9.6 billion surplus in its pension fund). Despite problems, Michigan ranked second nationally in new corporate facilities and expansions in 2004. From 1997 to 2004, Michigan was listed as the only state to top the 10,000 mark for the number of major new developments, led by Metro Detroit.[32] Manufacturing in Michigan grew 6.6% from 2001 to 2006.[12] In 2007, General Motors, Ford, and Chrysler reached agreements with the United Auto Workers Union to transfer the liabilities for their respective health care and benefit funds to a 501©(9) Voluntary Employee Beneficiary Association (VEBA) raising prospects for corporate turnaround plans.

Even though Michigan is known as the birthplace of the automobile industry, its diverse economy leads in many other areas. Michigan has a booming biotechnology industry and the Michigan Life Sciences Corridor is a $1 billion biotechnology initiative in the state of Michigan.[33] As leading research institutions, the University of Michigan, Michigan State University, and Wayne State University are important partners in the state's economy. Michigan's workforce is well-educated and highly skilled, making it attractive to companies. Michigan's infrastructure gives it a competitive edge; Michigan has 38 deep water ports.[34]

Michigan Economy at a Glance

http://www.detnews.com/apps/pbcs.dll/artic.../706130416/1001

Michigan is quickly becoming a "relatively poor state" that is likely to get poorer unless the auto industry rebounds to pull the economy out of its "one-state recession," according to Comerica Bank's chief economist.

The analysis released Tuesday by economist Dana Johnson echoes recent gloomy assessments from other experts and is sapping hope that Michigan will halt its long slide.

Johnson backed away from predictions he made last year that the state's job losses, distressed real estate market and declining population might begin to trend upward this year.

It certainly doesn't look good for Michigan, not surprising housing in some areas is so cheap.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 401 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.