Real Estate Crash thread

[Harry]

^^ that was exactly my condo HOA in Big Sky. Ticking time bomb.

People that bought it from me waived any right to home inspection or reviewing HOA documents or financials. They paid me ca$h. Fools.


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[Toadman]

Apparently someone from the NYTimes read the insurance discussions above and did some further research.

https://www.nytimes.com/interactive/...smid=url-share

Interesting times. Was having dinner with a vendor last week who is based in Nashville. His home owners insurance was cancelled. He had to file a claim for some roof damage from a storm. He had one other claim about 10 years earlier. Insurance company said it was the 3rd claim on the house. He said, I've only filed two. Insurance company says that the prior owner filed a claim. His new insurance is now $2k more per year.

With inflation and the cost of home repairs (pardon the pun) going through the roof, no wonder home owners insurance is so high.

[altasnob]

Just the free market at work. Now people will be forced to live in more dense, sustainable, urban zones where insurance risk is minimized, spread out amongst many homes, and cost of construction is lower. Sprawling suburban and ski town homes in the wildland urban interface will be cost prohibitive.

The government is incapable of preventing urban sprawl in America (the least dense, largest homes on Earth). Zoning doesn't work (or urban growth boundaries are never strict enough). The only thing that will successfully force Americans to live in a dense, urban environment, like the rest of the planet, is high cost of insurance. This is a good thing and is the result of the free market doing its thing. But it won't stop people from bitching about having to live with the consequences of their choices.

[Whiteroom_Guardian]

^^ that was exactly my condo HOA in Big Sky. Ticking time bomb.

People that bought it from me waived any right to home inspection or reviewing HOA documents or financials. They paid me ca$h. Fools.


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Yup. It's an old story. The owners in a complex who want to keep their HOA super low (and as a result live in a crumbling slow smolerding dumpster fire) are just shooting themselves in the foot.

Of three older complexes there within 1/4 mile of each other (all three of which maggots have owned and maggots have been my clients) only Hills have actually taken a real look and made major upgrades. Huge invasive siding project, new common stairs, new invasive roofs on all buildings etc. They have actually turned that place around and values there on re-sell reflected it.

The fruits of the labor will only really show now and into the future as we return to a more normal market. 2020-early 2022 was so insane. Buyer: "This place looks like a college dorm and the common areas are a mess and nothing has been improved since 1997? Cool. No inspection needed. Take my cash."

[fastfred]

I have been doing major structural work for an hoa in summit county
they got no money so we do a bit every year place is literally fucked from 30 years of deferred maintenance

I was just told to provide a bid because the new mayor of the hoa wants three bids for every project no more hourly no more whatever
the manager of the complex is a bro so we always had some arrangement that worked out pretty good for the hoa and ok for me

my bid for this summer's project is twice as much as what I charged two years ago for the same exact job
fuck that guy

[Foggy_Goggles]

"Is this a competetive bid project? OK, great. I'm gonna need a written scope of work, material specification and the contact information for the consulting engineer. Lets schedule a walk though with the HOA Pres., the management company rep., and the engineer. Do you have documentation of board authorization of the expenditure? Oh, so you want a free estimate? Sure, $100k. Oh, like a real bid. You don't have all that shit? Sweet, I'll email you an invoice of a $1k consultation. My time ain't free".

Drive by 3 years later, project hasn't been done.

[Name Redacted]

It isnt just HOAs getting dropped. SFHs with no HOA are getting dropped left and right too.

[liv2ski]

And my wife continues to tell me "told you that area was a problem". When I said til death do us part, I had no idea it meant our home too.

[possum]

Our HOA sent an email recently warning anyone planning on buying a new grill this summer that our insurance co. may require us to ban GAS grills.
We don’t allow wood or charcoal already.

[byates1]

What haircuts are allowed?

[Core Shot]

What haircuts are allowed?

Mullets

[Conundrum]

Our HOA sent an email recently warning anyone planning on buying a new grill this summer that our insurance co. may require us to ban GAS grills.
We don’t allow wood or charcoal already.

Are they allowing gas grills 10+ ft from structures? Most insurance companies are following NFPA guidelines. Maybe they're tightening up more in higher brushfire score zones. Haven't seen no grills yet, just 10+ ft from walls, ground floor only.

https://www.nfpa.org/news-blogs-and-...irecodefridays

These guidelines have been around for a long time but insurance companies didn't really start looking at them until 4-5 years ago at least when underwriting risk and premiums.

[Conundrum]

What haircuts are allowed?

Karen cuts for the ladies.

Mullets

For the dudes.

[I Skied Bandini Mountain]

I was talking the other day with a owner of a largish (for Grand County) HOA/property manager. He said increases in premiums for HOAs (condo complexes with actual common elements) range between 12% and 400%.

He said the primary drivers are claims and deferred maintenance/reserves. I'm no apologist for the insurance industry, but the behavior of these BODs needs to take some responsibility.

In Colorado, you basically need to have a licensed Community Association Manager who, in theory, has been educated on this stuff.

CAM "Hey, your records indicate you haven't you haven't replaced your roof in 30yrs., you had three claims last year. We suggest you at least start budgeting for replacement in your Capital Replacement Plan"

Board "Cool, can you please get us some bids for the next quarterly meeting"

Contractor "That will be about $300k"

Board "Fack, we don't have that money"

CAM "No shit, that why we said you should raise dues, have a special assessment, borrow the money or do something...we should talk about it at the annual meeting"

Homo's at the meeting "[Karens/outrage/fixed income/can't afford it/dumbasses]"

CAM "Yeah, you people suck. We are gonna not renew your contract because our staff hate you because you ignore all professional advise. We'll just replace you with a newer complex with more wealthy owners who ain't afraid to maintain their complex"

Steve and Stacey "I think we should sell, take our equity, maybe buy somewhere new that maybe doesn't suck as bad. I'm sure there is some Conners and Addisons that want to be the first in their friend group to #we've got a place in Fraser"

Realtor "yeah, nobody looks at the HOA finances. The home inspection actually precludes that stuff. I don't bring it up. I've got all kinds of clients that can only afford the older, shitbox condos. I'll make it happen"

I did an inspection last year on a pretty notorious condo complex here in town. One of the originals from the 70's, and the exteriors and common areas were just in tatters - unsafe balconies, broken up walkways, deteriorated driveways, concrete retaining walls falling over, an improperly installed replacement roof, place is just a gigantic mess. During the client walkthrough I advised the buyers that they should check for any upcoming special assessments as the place was in pretty poor shape. RE agent was like "huh??". Come to find out the previous management company was fired due to gross mismanagement and was in litigation with the HOA, and a literal avalanche of special assessments were coming down to fix the bad roof and all the other problems. The condo owners were either having to take out seconds to afford the assessments or getting the hell out. I killed that deal right in front of the agent's face.

[Cono Este]

A problem Im having trying to GTFO of St. Louis, is condos are having a much harder time getting conventional financing. I fucked up not getting out sooner, but waited for my son’s first college ball season.

Mkt high was in march in my building. But new insurance reqs fucked it up. That collapsing surf side building in Miami did not help.

[liv2ski]

Price to sell and cut your losses?

[shroom]

currently have an open claim with Nationwide. first claim. I’ll report back on the aftermath some day. so far they’ve been reasonable.

[Skistack]

They covered a roof and window replacement after a hail storm last year. Relatively pain free and experience.


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[Cono Este]

Price to sell and cut your losses?

I will. I’d like to rent, but long term I don’t think my kids will even stay here for me To let them have it. My ex is bailing in a yr after trapping my ass here.

I was too busy driving and skiing to sell sooner. New insurance was spread out over multiple carriers, so we’re fucked. Insurance is the problem.

I guess Fannie and Freddie have a list now of more approved buildings?

Probably cost myself 50k not selling in March, but I was skiing.

[Conundrum]

Remember when Americans weren't fat and depressed, healthcare wasn't that expensive, claims were not that frequent nor as predictable as today, and health insurance was somewhat cheap? Was about 25 years ago when things started to turn.

There's an analogy and some realism here. Insurance companies like turning a profit and nerds are pretty good at running numbers.

[Cono Este]

I had to go shop this for my building. I have experience from pricing otc derivative packages for these same fuckers. I do the math now, on the secondary mkt, the risk spread out across several buildings, and I wish I could sell myself.

But to be fair. When states put a 6% cap on rate increases like California, when the Covid fucks supplies, and no one wants to work any ore, I’d pull out of that state too.

My friend sells 250mm a yr in Palo Alro/atherton, and she’s losing deals unless it’s cash.

[Conundrum]

I had to go shop this for my building. I have experience from pricing otc derivative packages for these same fuckers. I do the math now, on the secondary mkt, the risk spread out across several buildings, and I wish I could sell myself.

But to be fair. When states put a 6% cap on rate increases like California, when the Covid fucks supplies, and no one wants to work any ore, I’d pull out of that state too.

My friend sells 250mm a yr in Palo Alro/atherton, and she’s losing deals unless it’s cash.

Didn't derivatives lead to the Great Recession that early on was the impotence of this thread titled "Real Estate Crash Thread"? Are you sure you want to be selling risk financing?

[Cono Este]

Didn't derivatives lead to the Great Recession that early on was the impotence of this thread titled "Real Estate Crash Thread"? Are you sure you want to be selling risk financing?

With all due respect that is quite a generalization.

I primarily priced, and sold risk reversals to large shareholders, insiders, ceos,and anuities , looking to hedge common stock they’re restricted from selling. . Usually split strike, custom strike prices, zero debit to them. Like the trade Cuban made that he brags about. Although he is so fucking clueless as to how much money that counter party made.

Then the Wall Street whores realized how much we were making, and started to,rip their own customers off instead. I went skiing.

[Conundrum]

With all due respect that is quite a generalization.

I primarily priced, and sold risk reversals to large shareholders, insiders, ceos,looking to hedge common stock they’re restricted from selling. . Usually split strike, custom strike prices, zero debit to them. Like the trade Cuban made that he brags about. Although he is so fucking clueless as to how much money that counter party made.

Sorry for the generalization. With your quick edit on removing the Charlie Sheen always winning stuff, my post doesn't make much sense.

My health insurance analogy wasn't directed at you if you think it was.

[Cono Este]

Sorry for the generalization. With your quick edit on removing the Charlie Sheen always winning stuff, my post doesn't make much sense.

My health insurance analogy wasn't directed at you if you think it was.

Sorry
My point, that I removed, is that i was not their friend, we ripped them off for as much as possible.

When their bankers finally did figure what we took, they started to do it in house, rip off their own clients, then the trades were not guaranteed, they cross guaranteed, without margin, thus the disaster.