The Collected Works of Author and Blogger Larry Roberts

Archive for February, 2014

... and Thursday, and Friday, and Sunday, and Monday; ok already, the whole rest of the week. Last time, we left off with some fool opening a water valve while looking directly into the out flow.  After he dried himself off, and after drying off the bathroom, it was time to install the "custom" vanity.     See, I told you the space was odd shaped and there was no off the shelf vanity that would fit.  The plumbing can not be installed until after the countertop is installed and the countertop can not be installed until it has been fabricated.  So, it's off to the internut, Lowe's, and Home Depot to have a "custom" countertop fabricated.  My understanding of…[READ MORE]

When borrowers and lenders petition the government for relief through debt forgiveness and bailouts for losses, you are the one paying for whatever the borrower did with that money; the government is merely a middleman facilitator of a tax heist. In a bygone era, lenders lost money if they made bad loans to irresponsible borrowers. With the advent of securitization, much of this risk of loss transfered to investors, and with the economic catastrophe of 2008, lenders learned the government would bail them out for any losses they were unable to pass on to investors. The too-big-to-fail banks no longer attempt to conceal the moral hazard behind their actions; they know they will be bailed out, so they act accordingly.…[READ MORE]

The financial media blames the weather to cover up the underlying weakness in housing. “It is better to offer no excuse than a bad one.” ― George Washington The housing recovery sputters badly; housing starts are down, mortgage applications are down, and buyers evaporated -- at the time of year when all of these factors are supposed to increase. These unexpected developments, unexpected by brilliant economists, demand explanation. Mainstream media reporters, the paragons of insightful analysis and objective reporting, explain how these events caught reporters and economists completely by surprise the only way an apologist knows how; they make up a lame excuse: the weather. Cold weather sinks U.S. home building in January By Lucia Mutikani, WASHINGTON Wed Feb 19,…[READ MORE]

Investors buy delinquent mortgages from lenders with plans to foreclose, boot out the mortgage squatters, and convert the property to rentals. This strategy may cause an increase in foreclosures nationwide. REO-to-rental investment hedge funds exhausted the supply of homes they could acquire at auction or on the MLS for the prices they need to make the investment profitable. Desperate for more homes to add to their portfolios, investors turn to lenders to buy the non-performing loans on their books so these investors can foreclose on the delinquent borrower and obtain a rental property. This new strategy may cause a dramatic increase in the number of foreclosures. I didn't see this coming. Like most industry observers, I assumed that once house…[READ MORE]

The next generation of homebuyers, Millennials, have too much debt to buy their first homes. As a result, first-time homebuyer participation is at near-record lows, and the situation isn't likely to change any time soon. The typical sources of housing demand are largely absent; in particular, first-time homebuyer participation is at near-record low levels. First-time bomebuyers only make up 29% of the market today, compared to 40% in normal times, and without first-time homebuyers, long-term homeowners are unable to execute move-up trades. This causes sales volumes to flag across all market segments, which is what we're seeing now. Some point to the lack of first-time homebuyers as a significant source of pent-up demand; for example, more Millennials are living at…[READ MORE]

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