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Some good analysis at Dealbreaker, including the gem Morgan Stanley Has Had It Up To Here With This Bosh.
Wednesday, September 17, 2008
Northern Virginia Bits Bucket 9/17/2008
Posted by Harriet at 8:28 AM
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15 comments:
How many knife catchers does it take to chase the market down?
FX6875044
Sales History
Date Price Appreciation
Jun 24, 1981 $94,000 --
May 09, 2006 $560,000 7.4%/yr
Dec 04, 2007 $440,000 -14.2%/yr
Jan 14, 2008 $369,900 -78.7%/yr
This is a short sale. Whether it was previously a foreclosure or has had multiple short sales since the insane 2006 sale at $560k for a rambler that backs right up to the tracks, I don't know.
How many more knife catchers will it take to spread out the losses on this one property??
Still way overpriced.
The $369K was a foreclosure price after the bank(s) ate at least $120K, and now it's trying to be sold for less. And if it doesn't work out, it will probably foreclose again.
Yes, the quintessential knife-catching scenario.
Right next to the railroad tracks and to Springfield Mall? No way. I would almost rather buy that trailer that was discussed a couple of days ago.
Well, at least it has the virtue of being convenient to the metro. Which is a major plus. But I think it needs to come down another $100k before it's over.
It's worth about $225,000 tops. Man, this just goes to show how much farther prices have to fall before they get back to rational levels (despite the fact that they fallen alot already).
Hi,
Does anyone know where I can get information on the percentage of all mortgage loans originated for Northern Virginia in 2005 and 2006 consisting of option ARMS?
There's a boatload scheduled to reset in 2010 and 2011. I've been able to locate info to the effect that Virginia state is 5th behind the usual suspects - California, Florida, Nevada, and Arizona, and I suspect most are in Northern Virginia.
Thanks for whatever help you can provide.
aarl renter - You are correct. There are currently about 60,000 junk loans in all of VA & about 1/2 of them ended up here in NOVA.
Now, I dont have info on the 05 & 06 Vintage specifically, but I do have some info on all vintages (i.e. all toxic loans in the toxic loan universe)
Here is some info I pulled from the NY Fed before they took away our ability to see the toxic loans on a county by county basis:
1. Total motal number of adjustable Liar Loans by county
Arl - 1,300 (1.4% of Arl homes)
Alex - 1,000 (1.5% of Alex homes)
Ffx - 8,100 (2.3% of Ffx homes)
Lou - 2,200 (3.5% of Lou homes)
Pwc - 4,000 (4.1% of Pwc homes)
2. Of these, a good 35% have already reset as of January when they took away our ability to see county by county data. Since then another 5% or so have reset. Meaning that the remainin toxic loans yet to reset are
Arl - 845
Alex - 650
Ffx - 4,860
Lou - 1,320
Pwc - 2,400
In a nutshell, this above is the main reason I do not think the upcoming wave is going to be all that spectacular - especially in the inner counties where the % of homes burdened with these sorts of loans is far less than the outer counties.
Also, in terms of our state ranking, we are roughly tied with 8 or 9 states for that 5th place on the junk loan list - behind the big 4 (CA, AZ, NV & FL). For context, keep in mind that the #1 state CA had 3X as many junk loans per population than we did here in VA - meaning just because we are in 5th place behind them - dont expect anything like a CA implosion here - at least as long as our inventory keeps shrinking rapidly, and our economy keeps adding jobs.
Thanks, CRT. That's very helpful. I wondered why the NY Fed pulled the data? Transparency is a hallmark of good government.
I'm getting a little hung up on the numbers. In your first paragraph, the junk loans in NOVA add up to 30K. However, the total number of adjustable loans you list by county are 16,600 before modification. Given the population of those five places, one suspects that they would make up the preponderance of the loans. Are the "adjustable liar loans" a subset of all toxic loans?
If not, what am I missing here?
Thanks again.
No Problem Aarl renter - I wonder too why they took away our ability to do a county by county comparison. Someone mentioned perhaps because it would let us all know which areas to prey upon - but I dont know - its weird regardless.
"Are the "adjustable liar loans" a subset of all toxic loans?
If not, what am I missing here?"
Essentially yes. Total Alt A universe in VA is around 60K loans. A bit more than 1/2 of these (34K) are adjustable. Of these adjustable about 1/2 (16,600) are infecting NOVA - the other 14-15 K are elsewhere in the state.
aarl and crt:
NY Fed only posts data on subprime and ALT-A. But defaults nationwide are increasing on prime as well. I cannot find data as to the amount of prime loans in NOVA that involved I/O or I/O option-pay ARMS. I've read on Calculated Risk that most prime I/O ARMs are 5 or 7 years until adjustment, so you'd be looking at adjusted payments kicking in during 2009-2012 (5-7 yrs from market peak).
"It's worth about $225,000 tops..."
I was going to say 200k and even that would be a stretch.
Folks, some places have a loooong way to go.....
"Terminator X said...
NY Fed only posts data on subprime and ALT-A. But defaults nationwide are increasing on prime as well. I cannot find data as to the amount of prime loans in NOVA that involved I/O or I/O option-pay ARMS."
Agreed but the pay option universe is apparently pretty much limited to Alt A (not so with Prime IO) Part of the problem too is no one seems to agree on the definition of what would be considered ALT-A.
I would bet that a "prime interest only" is considered prime by just about anyone. However, I know that many lenders consider any sort of pay option as being in the Alt A - regardless of credit worthiness.
Same thing goes with any loan with a teaser rate, but to a lesser extent. Here some consider this to be Alt A too, but a good many consider this prime - period.
Just goes to show how truly uncharted territory this whole thing is when the powers that be cant totally agree on definitions.
CRT,
If they agreed on the definitions they might all have to write down their assets at the same time. That might be worse. (than this semi-ordered collapse)
;)
Very true Cara - they say ignorance is bliss right!!!
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