Clearing out the rubble

From the WSJ: Investors pounce on distressed houses.

The pace of housing sales has been rising in many markets this year, but it is only partly because families seeking affordable housing are returning to the market.

It also is because of investors like former Deutsche Bank managing director Matthew Cooleen, whose firm has spent $30 million buying pools of foreclosed houses from banks.

His newly formed Greenwich, Conn.-based firm, HudsonCross Financial, is betting it can make a profit reselling in beaten-down markets in states like Nevada, Arizona and Florida and in Southern California because it is paying so little for the homes.

Outside San Francisco, a former Morgan Stanley executive director’s new firm is buying four houses for 75% less than they cost four years ago, and is raising $6 million to purchase others.

I can already hear Walt asking, “so what are Futter & Fontanski doing about all this?” The answer, Walt, is contained in the warning set forth below – a number of investors already knew this and are calling us. Your house is on the potential list, I’m sorry to say.

Buying houses, rather than apartment buildings or other commercial property, tends to favor small investors who are agile and understand local submarkets. ….  Much of today’s buying is being done by mom-and-pop investors, who are acquiring a few houses to rent out.

But in some markets, where prices have fallen the most, the bargains are difficult to pass up for larger investors.

Two newspapers in one!

NYT, May 14, 2009: Thriving Norway Provides an Economics Lesson

NYT, May 19, 2009: Despite oil reserves, Norway slips into recession.

That didn’t take long

This morning I warned that Obama’s caving into the California nut jobs on auto emission standards would simply set the table for the next serving from the left coast. This afternoon that fine state announced it was readying the next set of far more stringent standards. Again: these people are not about civilization as we know it and they won’t stop until they’ve destroyed it.

“California will be immediately getting to work on what the standards should be for beyond 2016,” Mary Nichols, who chairs the California Air Resources Board, said in a telephone interview. She expects “a much more stringent standard.”

White House emails remain secret, court rules

Do you remember when that man Bush insisted on maintaining the confidentiality of these emails and he was denounced as a cryto-fascist imperial clown? Well the Messiah insisted on continuing the case and he won! So now I’m really confused: does that mean Bush was right, or that Obama is a crypto-fascist imperial clown? Inquiring minds want to know.

Problems with Connecticut’s economy? Here’s a sure cure

Idiot legislator from Norwich introduces bill prohibiting employers from firing disabled workers who take long lunch hours and lose track of time. From Overlwayerd.com, natch.

We’ll always have Paris – or Greenwich

Here's looking at Tod's, Kid

Dickie Fuld, late of Lehman, Nantucket and Jupiter Island, Florida, is putting his New York City co-op up for sale – yours for just $32 million. So far, no whispers that his North Street acreage is on the market, but we’ll see.

If Dick  keeps selling off his houses, Cathy Fuld is either going to single-handedly put Lynnens on the Avenue out of business or she’ll have 771 North Street rafter-deep in bath towels. What’s a shopper to do?

Summer rental bargains?

Bloomberg: Hamptons prices fall most since 1982. Or more – they only started keeping records in 1982.

May 19 (Bloomberg) — Sculptor Fredi Cohen expected the hand-carved sinks and tubs in her East Hampton, New York, home to stand out in the real estate market and help sell her three- bedroom house for $1.25 million.

Almost two years later she’s still waiting.

“People have stopped buying real estate,” said Cohen, who designed the kitchen and bathroom tiles herself. “Now I would sell it for $999,000.”

The number of unsold homes in the Hamptons rose 15 percent to a record 1,673 in the first quarter from a year earlier, according to data compiled by New York-based appraiser Miller Samuel Inc. Sales have declined the most in the 27 years that broker Town & Country Real Estate has kept records for the Long Island beach towns about 100 miles east of Manhattan.

The inventory of Hamptons’ homes would take 34 months to sell at the current pace, Miller Samuel reported, or more than three times the 9.8 months’ supply of existing homes in the U.S. as tracked by the National Association of Realtors.

Wall Street bonus cuts and job losses have resulted in fewer buyers in a community that has attracted Hollywood celebrities such as Sarah Jessica Parker and financiers, including Blackstone Group LP Chief Executive Officer Stephen Schwarzman.

Sales in the Hamptons plunged 67 percent in the first quarter from a year earlier, according to a report by Town & Country. It was the biggest percentage drop in records dating to 1982.

The median price dropped 28 percent from a year earlier to $698,461, mostly on a decline in sales of $5 million or more, Town & Country said. The total value of all Hamptons real estate sold in the first quarter fell 78 percent to $140.2 million.

“The sellers are keenly aware that if they haven’t sold in a better market, they really need to adjust their prices,” Desiderio said.

Vacant land sales have also declined. In the first quarter, 29 residential parcels sold for a total of $19 million, 56 percent fewer properties than a year earlier and 88 percent fewer than the same quarter in 2005, according to Suffolk Research Service Inc. in Hampton Bays.

“It’s a strong indicator for the fact that there’s no market for houses,” said George Simpson, president of Suffolk Research, a real estate data service. “There are enough of them around you’d be crazy to build one.”