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Old 10-09-2008, 11:31 AM
VSB
 
Location: Raleigh
170 posts, read 797,465 times
Reputation: 193

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Quote:
Originally Posted by Charlton Dude View Post
After the economic meltdown is done, after we hopefully stop having the government force banks to lend to minority & low income neighborhoods by a certain percentage and after the recovery is underway, what do you think the housing market will look like in Raleigh & surrounding towns?

CD-

If you are the thoughtful, research-oriented intellectual you purport to be, then you should be able to recognize that several of your comments are directly or indirectly racist, classist, inflammatory, and hurtful. Passive-aggressive statements such as, "I am sorry you took it that way," reek of subterfuge.

Unfortunately, not everyone who reads your (or anyone else's) posts may be able to read between your thinly veiled lines. If you are truly interested in the effects of the current crisis on the Raleigh/Triangle housing market, then your intervening clause about the poor and non-white is completely unnecessary (you know it, I know it, the American people know it).

Your subsequent statement, "government intervention to force banks to give mortgages to people that could not afford it, just because they were a minority or poor" is presumably a reference to the Community Reinvestment Act of 1977 (under Carter), which many conservative and libertarian critics have falsely singled out as the cause of the current crisis.

In reality, the policy was enacted to stop the discriminatory practice known as "red-lining," a practice in which banks refused to write mortgages for prospective homeowners in certain low-income, and primarily minority neighborhoods, no matter who was applying or how creditworthy they were.

It is true that increasing rates of minority homeownership and increasing minority population is correlated (not causal) with increased foreclosure rates. However, minorities are also less well educated and more prone to predatory lending practices. A study by the Federal Reserve Bank of Minneapolis recently found that "a high percentage of adults with very low credit scores and an upward trend in the percentage of minority homeowners were the two factors most strongly and robustly associated with high foreclosure rates in 2002." (Federal Reserve Bank of Minneapolis Community Affairs Report 2006-1).

However, they go on to note that only 17% of the foreclosed loans in their study originated from a bank, and the CRA does NOT constrain or regulate the lending practices of other mortgage originators (such as a Countrywide et al). That means that Countrywide, Ameriquest, et cetera were under no obligations to meet any CRA-mandated lending criteria. Their obligation was only to their pocketbooks and shareholders, as they were riding the wave of easy credit and never-ending appreciation. The Federal Reserve further notes that that Ameriquest recently settled claims of abusive lending practices.

Finally, there was a more recent study by Traiger & Hinckley LLP, a law firm that advises the financial world on CRA compliance, which specifically found the following (The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis; Traiger & Hinckley LLP, January 7, 2008).

(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches.

The truth is, that there is a good debate to be had here about the causes of the current crisis (and a whole lot of data to refute your overly broad generalizations). Furthermore, this is clearly a complicated question requiring intensive, honest, and lengthy research.

Unfortunately, you have revealed yourself to be a voice of hate and deception, and you're engaging in a centuries old practice of blaming the generally voiceless masses of the poor, and non-white, for whatever current ailment grabs the national headlines.
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Old 10-09-2008, 12:16 PM
 
137 posts, read 552,092 times
Reputation: 110
Quote:
Originally Posted by VSB View Post
[/b]
CD-

If you are the thoughtful, research-oriented intellectual you purport to be, then you should be able to recognize that several of your comments are directly or indirectly racist, classist, inflammatory, and hurtful. Passive-aggressive statements such as, "I am sorry you took it that way," reek of subterfuge.

Unfortunately, not everyone who reads your (or anyone else's) posts may be able to read between your thinly veiled lines. If you are truly interested in the effects of the current crisis on the Raleigh/Triangle housing market, then your intervening clause about the poor and non-white is completely unnecessary (you know it, I know it, the American people know it).

Your subsequent statement, "government intervention to force banks to give mortgages to people that could not afford it, just because they were a minority or poor" is presumably a reference to the Community Reinvestment Act of 1977 (under Carter), which many conservative and libertarian critics have falsely singled out as the cause of the current crisis.

In reality, the policy was enacted to stop the discriminatory practice known as "red-lining," a practice in which banks refused to write mortgages for prospective homeowners in certain low-income, and primarily minority neighborhoods, no matter who was applying or how creditworthy they were.

It is true that increasing rates of minority homeownership and increasing minority population is correlated (not causal) with increased foreclosure rates. However, minorities are also less well educated and more prone to predatory lending practices. A study by the Federal Reserve Bank of Minneapolis recently found that "a high percentage of adults with very low credit scores and an upward trend in the percentage of minority homeowners were the two factors most strongly and robustly associated with high foreclosure rates in 2002." (Federal Reserve Bank of Minneapolis Community Affairs Report 2006-1).

However, they go on to note that only 17% of the foreclosed loans in their study originated from a bank, and the CRA does NOT constrain or regulate the lending practices of other mortgage originators (such as a Countrywide et al). That means that Countrywide, Ameriquest, et cetera were under no obligations to meet any CRA-mandated lending criteria. Their obligation was only to their pocketbooks and shareholders, as they were riding the wave of easy credit and never-ending appreciation. The Federal Reserve further notes that that Ameriquest recently settled claims of abusive lending practices.

Finally, there was a more recent study by Traiger & Hinckley LLP, a law firm that advises the financial world on CRA compliance, which specifically found the following (The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis; Traiger & Hinckley LLP, January 7, 2008).

(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches.

The truth is, that there is a good debate to be had here about the causes of the current crisis (and a whole lot of data to refute your overly broad generalizations). Furthermore, this is clearly a complicated question requiring intensive, honest, and lengthy research.

Unfortunately, you have revealed yourself to be a voice of hate and deception, and you're engaging in a centuries old practice of blaming the generally voiceless masses of the poor, and non-white, for whatever current ailment grabs the national headlines.

Hear Hear!!!!!!
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Old 10-09-2008, 05:02 PM
 
Location: Middle Creek Township
2,036 posts, read 4,389,507 times
Reputation: 532
Quote:
Originally Posted by VSB View Post
[/b]
CD-

If you are the thoughtful, research-oriented intellectual you purport to be, then you should be able to recognize that several of your comments are directly or indirectly racist, classist, inflammatory, and hurtful. Passive-aggressive statements such as, "I am sorry you took it that way," reek of subterfuge.

Unfortunately, not everyone who reads your (or anyone else's) posts may be able to read between your thinly veiled lines. If you are truly interested in the effects of the current crisis on the Raleigh/Triangle housing market, then your intervening clause about the poor and non-white is completely unnecessary (you know it, I know it, the American people know it).

Your subsequent statement, "government intervention to force banks to give mortgages to people that could not afford it, just because they were a minority or poor" is presumably a reference to the Community Reinvestment Act of 1977 (under Carter), which many conservative and libertarian critics have falsely singled out as the cause of the current crisis.

In reality, the policy was enacted to stop the discriminatory practice known as "red-lining," a practice in which banks refused to write mortgages for prospective homeowners in certain low-income, and primarily minority neighborhoods, no matter who was applying or how creditworthy they were.

It is true that increasing rates of minority homeownership and increasing minority population is correlated (not causal) with increased foreclosure rates. However, minorities are also less well educated and more prone to predatory lending practices. A study by the Federal Reserve Bank of Minneapolis recently found that "a high percentage of adults with very low credit scores and an upward trend in the percentage of minority homeowners were the two factors most strongly and robustly associated with high foreclosure rates in 2002." (Federal Reserve Bank of Minneapolis Community Affairs Report 2006-1).

However, they go on to note that only 17% of the foreclosed loans in their study originated from a bank, and the CRA does NOT constrain or regulate the lending practices of other mortgage originators (such as a Countrywide et al). That means that Countrywide, Ameriquest, et cetera were under no obligations to meet any CRA-mandated lending criteria. Their obligation was only to their pocketbooks and shareholders, as they were riding the wave of easy credit and never-ending appreciation. The Federal Reserve further notes that that Ameriquest recently settled claims of abusive lending practices.

Finally, there was a more recent study by Traiger & Hinckley LLP, a law firm that advises the financial world on CRA compliance, which specifically found the following (The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis; Traiger & Hinckley LLP, January 7, 2008).

(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches.

The truth is, that there is a good debate to be had here about the causes of the current crisis (and a whole lot of data to refute your overly broad generalizations). Furthermore, this is clearly a complicated question requiring intensive, honest, and lengthy research.

Unfortunately, you have revealed yourself to be a voice of hate and deception, and you're engaging in a centuries old practice of blaming the generally voiceless masses of the poor, and non-white, for whatever current ailment grabs the national headlines.
WOW!!! Some things said are just so far out there and off base, that they are not even worth responding to.


Back on topic however, one end result of this meltdown is far fewer new building permits. I just read that Wake County building permits are down 50%. As a result of less growth, there is the very real possibility that property taxes will be increased. One of the benefits of the growth we had was always increasing revenue. Now that revenue growth will slow. Less growth = higher taxes.
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Old 10-12-2008, 03:18 PM
 
9,680 posts, read 27,124,746 times
Reputation: 4163
Quote:
Originally Posted by Charlton Dude View Post
WOW!!! Some things said are just so far out there and off base, that they are not even worth responding to.


Back on topic however, one end result of this meltdown is far fewer new building permits. I just read that Wake County building permits are down 50%. As a result of less growth, there is the very real possibility that property taxes will be increased. One of the benefits of the growth we had was always increasing revenue. Now that revenue growth will slow. Less growth = higher taxes.
If folks would only have pushed impact fees, the money would have been obtained up front without borrowing.
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Old 10-12-2008, 05:58 PM
 
Location: Raleigh, NC
9,059 posts, read 12,952,428 times
Reputation: 1401
Quote:
Originally Posted by Charlton Dude View Post
WOW!!! Some things said are just so far out there and off base, that they are not even worth responding to.
While I disagre with the exact cause of the bubble (IMO it was a cheap money bubble started by the previous administration with the dot bomb bubble that continued into this administration to avoid a REAL post dot bomb bubble recession), I agree with the bolded response because I could've sworn with the hate/race talking points I was reading an Indy blog/editorial.

I'll never forget playing poker with some friends recently and being scolded for not have a dog in this hunt. Got the "you're going to throw your vote away?" spiel. I asked the young lady how does she reconcile having an idealogical bent on various issues while offering a diatribe for those like myself who aren't thinking pragmatically with my vote and instead opt for an idealogical Constitutionalist?
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Old 10-12-2008, 07:08 PM
 
3,939 posts, read 5,073,489 times
Reputation: 2554
Default Critical clairvoyance

Quote:
Originally Posted by Charlton Dude View Post
After the economic meltdown is done, after we hopefully stop having the government force banks to lend to minority & low income neighborhoods by a certain percentage and after the recovery is underway, what do you think the housing market will look like in Raleigh & surrounding towns? I figure we will go back to our normal 3 to 4% appreciation rates, nothing new there. The big difference will be the types of homes being built. With hopefully much tighter lending practices and ratios and fewer people able to cash in to move here, I predict we will see small to medium size homes being the rage. Homes 2000 sq ft and under will be the hot thing. They will be more affordable to buy and much more economical to run. This may open up the market more to first time home buyers.
Nationally, demographic forces are at work that both nonpartisan economists and honest real-estate people alike agree will shrink the size of future American homes. On the other hand, my understanding (correct me if I’m wrong) is that builders prefer to construct larger homes because they’re more profitable. I don’t think that these conflicting interests represent the classic irresistible force and immovable object paradox but they do present a bit of a dilemma for our nations economy. Ultimately, though, market forces will prevail and builders will be forced to adapt or go out of business. Either way we’ll inevitably have a correction in the market.

Concerning appreciation; it’s difficult to think in those terms when most sensible sources I subscribe to believe that many homes must depreciate by as much as 30% from their peak to be affordable. Even with the heroic 3% appreciation you suggest you’re still looking at almost ten years just to regain lost ground.

I know that the two men running for President, Treasury Secretary Paulson and Fed Chair Bernanke would like to artificially stabilize house prices but as the stock market consistently shows that’s simply not a realistic goal. The process of wringing out excess is going to take time, and be painful enough even to innocent bystanders that speculation about the aftermath on our local housing market is reckless conjecture at best.
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Old 10-12-2008, 07:13 PM
 
Location: Raleigh, NC
9,059 posts, read 12,952,428 times
Reputation: 1401
Quote:
Originally Posted by Grizzmeister View Post
Nationally, demographic forces are at work that both nonpartisan economists and honest real-estate people alike agree will shrink the size of future American homes. On the other hand, my understanding (correct me if I’m wrong) is that builders prefer to construct larger homes because they’re more profitable. I don’t think that these conflicting interests represent the classic irresistible force and immovable object paradox but they do present a bit of a dilemma for our nations economy. Ultimately, though, market forces will prevail and builders will be forced to adapt or go out of business. Either way we’ll inevitably have a correction in the market.

Concerning appreciation; it’s difficult to think in those terms when most sensible sources I subscribe to believe that many homes must depreciate by as much as 30% from their peak to be affordable. Even with the heroic 3% appreciation you suggest you’re still looking at almost ten years just to regain lost ground.

I know that the two men running for President, Treasury Secretary Paulson and Fed Chair Bernanke would like to artificially stabilize house prices but as the stock market consistently shows that’s simply not a realistic goal. The process of wringing out excess is going to take time, and be painful enough even to innocent bystanders that speculation about the aftermath on our local housing market is reckless conjecture at best.
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