Tralfaz

Day: March 31, 2013

  • Foreclosed Houses

    About 7 months ago, we moved to one of the foreclosure hot spots in the country, Phoenix. When I was first looking for houses, I was thought I would be able to pick up one of the many short sales, or foreclosed properties. Clearly, there was a large inventory, and finding a lot of listings in the $150K price range was easy.

    However, it wasn’t as simple as that. First, it is pretty clear that you are coming to a bank owned property when you arrive. To say that there is no maintenance on the yard, or the outside of the home is an understatement. You could tell from half a block away. Next, the insides were often rough. If there wasn’t a family living there (about 50/50 chance) the appliances would be gone and you would see damage to a lot of fixtures. Clearly you could tell that the prior owners had given up, and decided to take their misfortune out on the house.

    After looking at a couple dozen of these choice units, I was losing enthusiasm for finding a deal.

    Then I learned the truth. As someone who was looking for a home, there was virtually no chance that I would be able to buy one of these distressed properties. Whether it was foreclosed and up for auction, or whether it was one of the properties where the bank had acquiesced and allowed a short sale, the people who would be buying the home as a primary residence are pretty much out of luck.

    First, the bank is usually not in a hurry to sell the property. They have already recognized that the value they are sitting on is worth much less than they have it on the books for. They are willing to wait for months to close and write the property off. So people who are interested in buying much write a bid, prove access to funds, and wait. And wait some more.

    The process is rigged. Only investors are successful in buying these distressed properties. The hope that a family might be able to snatch up one of these is pretty much nil.

    We ended up spending $100K more, got a nice house in a nice neighborhood that was bought by an investor, cleaned up, and res0ld.

    The good news is that the inventory of bank owned properties, short sales, and foreclosures is shrinking.  The good news is that means the prices are rebounding, and we got in at a good time.

  • Neighbor Parties

    One thing I miss about Tucson is the solitude we had. We lived on the edge of town, at the end of a street with a fair amount of open space around us. Behind us was county property, SR zoned, 5 acre minimum lots. Not much noise at night.

    party105Here in Chandler, we live in a nice sub-division (Dobson Place), with (mostly) good neighbors. But on one side of us, there is a college aged kid  who lives with his parents. About every 3 weeks, he has a “gathering” of his friends. They drink, smoke (and toss their butts and empty beer bottles in our yard), talk loudly, and in general are annoying as hell. Last night, starting about 9:00PM, getting going good at 11:00, they were really obnoxious. Needless to say, I didn’t sleep well.

    About 1:15AM, another neighbor came and read them the riot act. They quickly and quietly cleaned up and cleared out. Finally.

    Next time, at 11:00PM, I am calling the police.

    FWIW, the kid’s parents were home, and they seem to be fine with this. Da fuq is up with that?

  • A cool thing about being a product manager

    Being a product manager is a high stress, diverse job. Every day will certainly be different. However, it also affords some cool moments. Doing strategic planning, I need to read and study what is happening at a macro scale in the world’s economy (I am by no means an economist, but I did stay in a Holiday Inn Express last night), and this means that I get to read a lot of different things.

    Friday, my task was to learn about China’s 12th 5-year plan, how that could affect spending on scientific instruments, and what that means to us. One of the stated goals of the plan was to begin the transition from an economy of makers (manufacturing for export), into a center of design excellence (the innovators). That is well and truly on the way, and has been reflected in the activity we see in the market.

    But, beyond reading the text published, I got a chance to read some analyses of the plan by the American think tanks, and investment banks. Some interesting facts come to light in their analyses.

    FOr instance, one of the goals is to shift to a more consumption led economy (where their population buys more of what is produced, instead of sending that overseas via export.) FOr this to happen, wages for laborers must rise, and more migration from the rural to the urban centers is required. But wage inflation also brings price inflation. Furthermore, since there isn’t a very robust security net (the average set aside for a worker in their version of Social Security is < $500USD), these wage increases are being pumped into savings (the average Chinese worker saves more than 30% of their earnings), thus hampering the desire to get the economy headed towards a consumption based model.

    And I work at making microscopes. Cool day.