Faucets At $1,000 Abound As Home Equity Spigot Opens

[Purveyor]

By Kathleen M. Howley - Nov 25, 2013

A year ago, New Jersey contractor Michael Mroz’s customers were focused on saving money when renovating kitchens and baths, he said. Now, with a resurgence of home equity lending, they’re ready to pay for the best.

“People don’t want granite countertops -- they want marble costing at least 25 percent more,” said Mroz, owner of Michael Robert Construction in Westfield, an affluent town less than an hour’s commute to Manhattan. “Money is so cheap today, people can splurge on $1,000 faucets.”

Spending on home renovations is rising to records as banks such as Wells Fargo & Co. and JPMorgan Chase & Co. (JPM) increase lending for home equity lines of credit, or Helocs, after property prices this year gained at a pace not seen since the last housing boom. Heloc originations could rise 16 percent this year and reach another five-year high in 2014, according to Mustafa Akcay, an economist for Moody’s Analytics, powering the earnings of Home Depot Inc. (HD) and boosting the economic expansion.

Helocs are making a comeback as the housing market recovers enough to make the junior mortgages a safer bet for banks more than seven years after the beginning of the housing crash that saddled them with billions of dollars of losses. The median price for an existing home probably will gain 11 percent this year, according to the Mortgage Bankers Association in Washington, after plunging about 33 percent during the crash.

‘Enormous Impact’

“The biggest use of Helocs is renovations, and the biggest spur for renovations is Helocs,” said Kermit Baker, director of Harvard University’s Remodeling Futures program in Cambridge, Massachusetts. “When the two fuel each other, it has an enormous impact on the economy.”

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http://www.bloomberg.com/news/2013-11-25/faucets-at-1-000-abound-as-home-equity-spigot-opens-mortgages.html

[Liberal Veteran]

1. I blame HGTV.

When it first came on, the shows seemed more geared to making do with a very modest budget and supplies.

Now it seems like every show is 85 thousand dollars to remodel the powder room and hand wringing over the "small budget" for the remodel.

[PoliticAverse]

2. What do the banks have to worry about? If it all goes bad again there'll just be another bailout...

[warrant46]

32. Absolutely you called it !!

They are bigger than before and not just "Too Big to Fail"

They will be "IMMORTAL"

[SoCalMusicLover]

3. How Did We Get Into Trouble Originally?

I seem to recall Home Equity loans being part of the problem.

Glad we've learned our lessons. The recovery is strong, so let's go back into debt again, and start borrowing against mortgages.

[Lex]

9. 80/20 home mortgage loans.

People purchasing homes with an 80% first mortgage, and 20% equity line. That was one of the ways people and banks got into trouble before.

[SoCalMusicLover]

11. Borrowing Against Rising Home Value

You can set your watch by the ignorance of the American people.

One need only look at how much home prices have risen again here in Southern California, almost to levels reached during the collapse.

Hey, it's a recovery, right? No reason we should worry about spending and/or borrowing. Time to rack up that debt once more like good little Americans.

[CanonRay]

4. People never learn

What goes up, must come down.

[hobbit709]

5. Anybody that spends a grand on a faucet deserves whatever happens.

[Holly_Hobby]

6. They will deeply regret marble

It's soft and stains easily. Quartz costs less than half and it's more durable than even granite.

But that's not the point.

[KittyWampus]

7. I'm a big fan of butcher block…. even cheaper.

[Holly_Hobby]

8. We replaced the stained up marble in our new house

with butcher block too! Easy care and easy on the wallet, as you said.

[haele]

12. Recycled glass countertops are cheap, fairly sturdy, and pretty cool.

Especially on an island or cabinent unit with some undercounter cheap low-wattage Ikea LEDs to highlight the surface - and provide light for the shelving underneith.
Another good option is stainless steel industrial kitchen countertops; you can get them at any resturant supply store, and don't need to put anything other than framing under them. Easy to clean, easy to replace component peices, handles the heat, and you don't have to worry about mold or bacteria build up.

We're going to be getting a bit of money and thinking of getting a used doublewide (for the cheapne$$) in a place that will cut our rent down by 2/3rds, and replacing a lot of the kitchen - and the bathrooms - with resturant (and other) salvage when we can to get a place we can be happy living in. Only thing that needs to be new would be wiring, plumbing or some drywall (at worse, the roof) if the place hadn't already been remodeled.

What we spend upfront for efficiency and comfort will save us at least half of what we've paid in rent over the years.

Marble Floors and countertops? Bleah. Expensive to install and maintain, and there is always the risk they will need to be replaced within a decade if they're used regularly. And if you decide you don't want that kitchen configuration after installing it, you're stuck unless you want to invest in the time, effort, and expense to change it out.

I like the DIY shows that help you get a polished or modern look as cheaply and again, as efficiently as possible. Both Laz and I've done remodeling carpentry, framing, roofing, drywall and ceilings, flooring, basic electrical, basic plumbing, and painting before, and even if he can't do the work, I can - and I can teach the kidlet and her boyfriend to do it right.

Haele

[PoliticAverse]

34. Most people don't appreciate how porous marble tends to be. n/t

[geek tragedy]

10. Hate to say it, but this kinda shows that stupid borrowers were part of the problem

in terms of creating the last bubble.

That said, big difference if the HELOC is the 50-70% slice of LTV rather than the 70-90% slice.

[BlueJazz]

13. I've noticed that water tastes much sweeter and fresher through $1000.00 faucets.

[Liberal Veteran]

14. Bah. If you pay less than $47,000 for a faucet, you might as well drink from the sewer. -nt

[hatrack]

17. $47,000? Meh. MY $435,989 faucet controls weather, has a built-in Stargate, AND . . . .

It's set up to manufacture $47,000 faucets during the day when I'm at work.

[BlueJazz]

21. LOL! This is the real DU !

[BlueJazz]

23. LOL!...Laughing so much, I'm posting in the wrong places.

[Incitatus]

18. Absolutely

But make sure you drink from a Baccarat glass.

[Demo_Chris]

15. A $1000 faucet? Is that real or are they making a point? nt

[Incitatus]

16. $1,000 on a new countertop, ok.

$1,000 on a faucet, no way in hell.

[Liberal_in_LA]

24. +1

[Gore1FL]

27. Here's one for over $2K!

http://www.homedepot.com/p/Whitehaus-Vintage-III-Deck-Mounted-Potfiller-with-Lever-Handle-in-Antique-Brass-WHKPFDLV3-9555-ABRAS/204289482?N=ar0kZ1z10p7s%3FNs%3DP_REP_PRC_MODE%257C1#.UpP8D8RDuSo

[Aerows]

29. "Things that don't make a damn bit of sense"

Latest entry.

I will be the first to say that I don't ever want to have enough money that something like that seems to be a good buy. If I ever get so wealthy that it seems like a useful expenditure of my resources that I buy a $2,000 faucet, put me down and use the money to do makeovers of inner cities and their schools. It annoys me that such things exist, but we have children going hungry and rotting infrastructure.

Why in the fuck do we want to live like this is a third world country? We should be first in health care, first in education and first in infrastructure. Instead, we are first in $45,000 bags, $2,000 jeans and duck hunting, faith based idiocy.

[Incitatus]

31. ridiculous

I see nothing about that to indicate a value of $2,000. If the exact same faucet sold for $200, I doubt wealthy would buy it. Some people think they are getting a better product just because it is the most expensive. It gives them something to brag about and show off because they could spend $2,000 on a faucet. I read a bio on Warren Buffet a while back and from what I got he is rather a frugal person. He is one of the richest men in the world but does not buy into crap like that.

[Aerows]

19. I like the finer things in life

like a great pair of shoes (that last a decade), a nice couch (that lasts a few decades) and a filet mignon bleu (that lasts about a meal).

I can't imagine a faucet, a toilet or a spigot of any kind worth $1000. I freak out over women carrying purses that cost more than about $50. I want the money in my purse, not invested in the (likely tacky & ostentatious) purse.

But that's just me.

[Liberal Veteran]

26. This "beautiful" Louis Vuitton is a bargain at $45,000.

[Aerows]

28. I'd pay that for a Corvette

for a purse? That you put money in?

Thank you, I'll just keep the money in my leather backpack purse that I got at a flea market for $7 (after haggling). It has compartments for my phone, my wallet and the few things I take with me, and it's nice leather, actually.

That looks like shit, in addition to being overpriced for a bag. I'd carry my things in a grocery bag before I'd spend $45,000 on a purse.

[Retrograde]

33. For $45K I can fly first class to Paris

stay in a better class place than usual, have some great meals - and still have enough left over for a modest purse or three.

I'll go up to $100 for a bag, but considering that I've been using the same Le Sac one for nearly 20 years.

As for kitchens, isn't granite passe by now? And, yeah, plumbing items can cost an outrageous amount if you want anything the least bit out of ordinary.

[PoliticAverse]

35. Too expensive, stay with the $38,000 one...

http://www.democraticunderground.com/10023438406

[SoCalDem]

30. and to think I was embarrassed to spend $450 on a sink & $300 for a faicet

but but but they were made in France & they are Beeeeeyootiful