Just talked to a builder here in KC. He is trying to keep from going under.

[leftyladyfrommo]

And this a person who has been in the real estate business for probably 30 years.

I remember how bad it got in 1978 - a lot of originators and realtors went out of business. But he said this is much worse. Then the market died because the interest rate was 18%. As soon as the rates came down the market went nuts with refis.

But now the market is dead and the interest rate is 6%.

He said he heard that this probably won't turn around until 2010. I wonder if it will even turn around by then.

[LakeSamish706]

1. It must be absolutely devastating for the builders that are in the middle of...

projects right now, with no prospective buyers in site. It really is not a good time in this country and it certainly doesn't look like it will get better any time soon.

[leftyladyfrommo]

3. All the builders just have houses sitting - and construction loan

payments to make.

Joe is renting all the new houses he can. He said he has 13 construction loans that he took out a year ago. Each one has a $2,000 a month payment on it. He pretty much had to go ahead and build the houses. And now he is trying anything he can to get out from under the payments.

I don't think the downturn really hit KC until just the last year. Maybe the last two years.

Two of the people he just rented to were walking out on the houses they currently own. The ARM payments just adjusted and their payments went up over $1,000 a month. They didn't have any other option but to walk.

[DS1]

2. if he went through the last 6 years of the building market and has no savings

then wah

[Squatch]

4. Exactly what I was thinking.

However, since the business itself needs to maintain some positive cash flow to remain solvent, I can see how these businesses can go under. However, if he hasn't put aside a nest egg for his personal savings, then what the hell has he been doing with all that $$ over the past 6 years?

[leftyladyfrommo]

6. Builders tend to live pretty high.

They have big houses and fancy cars - have to keep up that image, you know.

[DS1]

7. You're not exactly pulling on the sympathy strings here

:rofl:


oh those poor people, with their big houses and fancy cars

whatever will we do? should we set up a donation drive?

[leftyladyfrommo]

5. The KC market didn't start to fall apart until about year's ago.

But then I think it just totally dropped off all at once.

Builders have houses sitting all over town.

[izquierdista]

14. Wait a minute....

I thought there was a homeless problem. People who had no place to live, people who were living out of their cars.

:nopity: :nopity: :nopity:

[tularetom]

8. WTF were these guys doing with the tons of $ they made?

I have a shirt tail relative that spent the years from 2000 to 2005 building McMansions on spec. He sold them as fast as he could build them and appeared to be making a lot of money. Of course he bought a new humongous pickup every few months and his wife flashed more bling than a rap award ceremony. When the bottom fell out last winter it hit him hard. Practically everything has been repossessed and he's now living in one of the monstrosities he couldn't sell waiting for the bank to kick him out. He's been doing handyman type repairs to buy groceries and pay the electric bill.

Couldn't these people see this coming?

[OrangeCountyDemocrat]

9. We're Supposed To Feel Sorry For These Vultures?

They bought up every piece of available land.

They destroyed trees, animals, in their thirst for developing more and more and more land.

All in the pursuit of making more money, and driving the price of buying a home to the point where it is completely unaffordable, without taking out a massive mortgage.

Yeah....I feel REALLY sorry for these folks.

[Squatch]

11. Vulture's gotta eat...

...same as the worms.

[leftyladyfrommo]

13. It's not about feeling sorry for the builders - its that when the new

house market goes down it takes a whole bunch of other things with it. The ripples just go everywhere out in the economy in general. That hurts workers everywhere in just about every part of the economy.

[OrangeCountyDemocrat]

15. Better Learn To Accept It

Things are going to get lots worse, before they get better.

Don't believe ANYTHING you hear.

I feel prepared, but not everybody is, and those who aren't, will feel the pain.

Don't forget, we still have 14 Months of this CORRUPT administration left.

[MadHound]

10. Yeah, this isn't a problem limited to the coasts and other hot spots

The housing downturn has effected everybody, everywhere, rural and urban. I have a friend in Tulsa who's been trying to sell his house for a year, no takers. Out here in rural Missouri, there are some foreclosures on the market that aren't selling. This isn't a limited thing, it is all over the country and getting worse by the day.

[Viva_La_Revolution]

12. "They" keep saying that the market is 'still OK' here in the NW...

but I can't believe it, not when I'm driving around town seeing the new builds with For Sale signs still out front after months. Existing home sales are level, but there's been a flood of homes put up in the last year or two.
We're doing a lot of smaller jobs this year too. People are staying in their existing homes and scaling down re-mods. Seems last year every place we worked on was going on the market, or the new owners were customizing.

[TahitiNut]

16. The housing downturn could be a long one. As I advised two friends recently,

... each of whom are renters and thinking about buying, they don't know what financial stress is until they're in the first year of a mortgage on their first home and looking at their market equity vanish due to a continued decline in market prices. I asked that they consider the difference between buying while the market values continue to decine and buying AFTER it bottoms out and is on the rise long enough to think it'll continue. They agreed that it'd be FAR better for their peace-of-mind to be seeing the market values rising during their first year or two of ownership.

In my view, this is a responsible attitude ... and one which many current renters would be well-advised to adopt. Thus, it would tend to prolong the decline ... since it's only when folks climb back in that the decline would be halted. What sane first-time buyer would want to be cannon fodder for the peace-of-mind of others?

(I focus on first-time buyers since flippers don't reduce housing inventory.)

[Blue_Tires]

17. i was living in Lawrence, but left in 2001

and the commercial/residential developers couldn't put shit up fast enough, especially in JoCo(similar to my hometown now)...did the well run that dry that fast?