Any Way The Wind Blows

Is this the real life? Is this just fantasy?

Caught in a landslide, No escape from reality

Open your eyes, Look up to the skies and see,

I’m just a poor boy, I need no sympathy

Because I’m easy come, easy go, Little high, little low

Any way the wind blows doesn’t really matter to me, to me

Bohemian Rhapsody — Queen

Link to Music Video

Despite the obvious headwind facing the housing market, there are always those who think it is about to turn around. Today’s property is a highly-leveraged knife-catcher who is risking their credit plus a few dollars to gamble in the residential housing commodity market.

43 Windchime Front 43 Windchime Kitchen

Asking Price: $739,500IrvineRenter

Purchase Price: $685,000

Purchase Date: 4/26/2007

Address: 43 Windchime, Irvine, CA 92603

1st Loan $548,000

2nd Mtg. $68,400

Downpayment $68,600

Beds: 4

Baths: 2.5

Sq. Ft.: 1,500

$/Sq. Ft.: $493Knife Catcher Award

Lot Size: –

Year Built: 2004

Stories: 2

Type: Condominium

View: Hills, Mountain, Trees/Woods, Other

County: Orange

Neighborhood: Quail Hill

MLS#: S493857

Status: Active

On Redfin: 44 days

From Redfin, “LARGEST DETACHED SAGE PLAN 4 w/ 4BR (1BR–now a den–DOWN); UNCOMMON PRIVACY W/ HILLS VIEWS FROM ALL BR’S!18 inlaid ceramic tile flring down Upgraded carpeting; Plantation Shttrs; Gourmet Kitchen w/ white-on-white appliances:LR W/ custom lited ceiling fan!Formal DR w/ custom liting & doors out to prof. landscaped bkyd (NO HOME BEHIND!)OPULENT MASTER W/ WALK-IN CLST; CUSTOM PAINT!ATT. 2 GARAGES; WALK TO ALDERWD BASICS+ ELEM; NR ASSN. COMMONS FACILITIES! AMENITIES!”

I have a difficult time reading through the schizophrenic use of capital letters, slashes and unusual abbreviations. Also, I question the validity of marketing this as a 4 bedroom.

.

.

If they get their asking price, with a 6% commission, these flippers stand to make $10,130. My guess is they are paying less than a 6% commission. In any case, it doesn’t seem like they have a very good risk/reward ratio for this trade, and it is a trade, after all. As long as people like this are trading the housing market, a normal family will never find a good deal. Of course, the crash will rid the market of flippers in a most painful manner. Also, what does it say about the health of the market when the only transactions we are seeing are flippers?

We will watch this property for an update.

43 thoughts on “Any Way The Wind Blows”

  1. Sue

    Indeed

    http://money.cnn.com/news/newsfeeds/articles/djhighlights/200708052206DOWJONESDJONLINE000330.htm

    A broker at mortgage brokerage firm ACE Mortgage Funding LLC estimated Friday that 90% of mortgages that don’t conform to standards set by Fannie Mae (FNM) and Freddie Mac (FRE) have disappeared in the last three days.

    As one visual sign of banks’ cooling to a variety of mortgages they had introduced over the years, the broker’s morning loan rate sheet dropped to one page – versus 10 pages usually. The broker asked not to be identified.

  2. Incredulous

    Pardon my lack of Realtor (TM)-speak, but what is a den-DOWN? Is this a den filled with goose feathers or a den stuck in the basement?

    As far as 18 inlaid ceramic tile flrg, is the number 18 some sort of feng-shui thing?
    —–

  5. Mr Vincent

    1500 sq ft + 4 bdrms + 3 bths = Very small rooms.

    Very small rooms + high density housing + Irvine premium = 350k. I would not pay more!

    The patio furniture is nice however!

  6. arraya

    How does this place comp out. Does he have a chance. There has been a bunch of sales on windchime in the past 6 months but zillow does not have sq ft, # bdr etc… Just wondering how it compares. Most of the sales were in the mid to high 500s with one just at 700…

  7. NanoWest

    In a market that is slowing as much as this market is slowing, comps. mean very little. All that matters is how much someone will pay for the house. If there are 4 houses in the local area that are on the market for more than 60 days, the realistic sales price is probably 20% – 30 % below the most recent comps.

    This is a hard pill for many homesellers to swollow, the fundamental question is…….”do you want to sell the house…..” if the answer is yes then price it to sell.

    Of course we will see RE agents with milk and cookies at an open house, we will see more flyers, upgrade allowances, we will see free cars, TV’s, and all other sorts of rediculous incentives. On zip you see statments like …..huge price reduction…….and the price is down $30,000 on a $750,000 property. Well a huge price reduction is more like $100,000.

  8. Darin

    I’ve started a new comments reading habit. I turn on the video that IR sets up, watch the first minute to check out what the video is like (Queen’s Bohemian Rapsody is massive amounts of smoke and white satin), then listen to the rest of the song while checking out the threads. Of course, the “nothing really matters to me” of this song really comes through.

    These speculator either must be asleep at the wheel or truly not care.

  9. IrvineRenter

    Darin,

    I find myself doing the same thing when I write the posts. I don’t know if it is noticeable or not but I let the mood of the music sway me when I write. That is why the tone of the writing in my posts varies so much from one day to the next. Some days it is somber and reflective, and other days it is light and whimsical. A lot depends on the music or literary reference of the day.

  10. n cty

    How is that called a back yard? Professionally landscaped–what move some potted plants around?

    Also where is the opulent master in the photos, I couldn’t find him.

  11. FamilyGuy

    I just can’t get over the fact that someone is still trying to flip like this. How do you completely ignore all the bad press that RE is getting right now and still jump in head first?

    It almost seems like there’s something missing here? (Besides judgement, wisdom, caution, etc etc)

  12. rkp

    It might not be a flipper. Most flippers try to put the least amount of skin in the game and this one has over $60K in it. It might be a divorce, job move, etc.

  14. socalhousingbubble

    Agree that 1500 sq ft 4Bed is a recipe for disaster. Secondary bedrooms are probably 9X9…

    SCHB

  15. biscuitninja

    I was just thinking the same thing, “those rooms must be the size of prison cells….” but then again, it is a prison of debt.
    -bix

  16. biscuitninja

    Agreed, I question why they would put in 60k and then turn around and borrow 60k out. But then again, I see people and they can’t even think more than 30-60 days in advance. Much less 5 years.
    -bix

  19. Kurtyboy

    “The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent.

    Economic growth was moderate during the first half of the year. Financial markets have been volatile in recent weeks, credit conditions have become tighter for some households and businesses, and the housing correction is ongoing. Nevertheless, the economy seems likely to continue to expand at a moderate pace over coming quarters, supported by solid growth in employment and incomes and a robust global economy.

    Readings on core inflation have improved modestly in recent months. However, a sustained moderation in inflation pressures has yet to be convincingly demonstrated. Moreover, the high level of resource utilization has the potential to sustain those pressures.

    Although the downside risks to growth have increased somewhat, the Committee’s predominant policy concern remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the outlook for both inflation and economic growth, as implied by incoming information.”

  23. CrashHappy

    FamilyGuy,

    “I just can’t get over the fact that someone is still trying to flip like this.”

    Neither can I. Sometimes I wonder if there’s something they (the flippers) know that we don’t, whether it be some sort of tricks, legal or illegal.

    Either that or they are just real aggressive (and stupid) risk takers.

    Or, things are just not as bad out there as the media portrayed.

  24. NanoWest

    Is CNN saying that Wells Fargo will charge everyone 8% for a jumbo loan ?

    From reading this blog I thought it was only loans originating from mortgage brokers.

  26. speedingpullet

    ROTFLMAO! ‘Opulent Master’, indeed.
    Actually, i found I lost my will to live about halfway through that ‘description’, so missed that little gem.

    Maybe alll Realtors ™ should have to pass a Basic English class in order to get their licence..but then again, the unintentional comedy value of stuff like that would be lost forever…

  27. Shannon

    Has anyone seen this on foreclosure.com

    This house is in Oakcreek.

    6 Blackbird Irvine CA 92618

    It is also showing an auction date for August 9.

    New comps for the neighborhood?

    http://www.foreclosure.com/search.html?st=CA&cno=059&z=92618&tab=p

    By the way, before I get a rude comment about how these people might have medical bills, I know these people indirectly and the only medical problems they have are keeping up with the jonesesidas and laziness.

  31. graphrix

    Wells retail charges a 1% origination fee and an application fee. Judging by their rate sheets a broker could do the same.

  32. biscuitninja

    Kinda evident when you see the three large TV’s. I think they will be lucky to get 400ish of thier asking price. But that’s just me.
    -bix

  34. Kirk

    Looks like the bulls stampeded all over your “bubble”! Sorry it burst for you. Better buy before it’s too late.

  35. Aerogell

    IrvineRenter,

    I wonder when you are going to use: “Welcome to the Jungle” by Guns N’ Roses.

  36. Aerogell

    Thanks for the tip.

    Queen performed “Bohemian Rhapsody” live just a few times (1 or 2 times if I remember correctly), for the chorus portion they used to put a tape and turn on/off the stage lights following the momentum of the song. Freddie Mercury, band’s vocalist, dissapeared for a moment returning later. Big Queen fan here! 😉

  38. Major Schadenfreude

    Kirk,

    You are right. People should buy right now if they want to use a jumbo loan (if they can find a bank that hasn’t raised its rates yet).

    Otherwise they should probably just wait a little while longer for the property to further depreciate. Then purchase it with a conforming loan!

  39. covered

    Or more Zeppelin:

    If it keeps on rainin, levees goin to break,
    If it keeps on rainin, levees goin to break,
    When the levee breaks Ill have no place to stay.
    Mean old levee taught me to weep and moan,
    Lord, mean old levee taught me to weep and moan,
    Got what it takes to make a mountain man leave his home,
    Oh, well, oh, well, oh, well.
    Dont it make you feel bad
    When youre tryin to find your way home,
    You don’t know which way to go?
    If youre goin down south
    They go no work to do,
    If you dont know about chicago.
    Cryin wont help you, prayin wont do you no good,
    Now, cryin wont help you, prayin wont do you no good,
    When the levee breaks, mama, you got to move.
    All last night sat on the levee and moaned,
    All last night sat on the levee and moaned,
    Thinkin bout me baby and my happy home.
    Going, gon to chicago,
    Gon to chicago,
    Sorry but I cant take you.
    Going down, going down now, going down.

  40. Kirk

    Major,

    Exactly. Soon the government will double the amount that can be taken out for conforming loans. It might make sense to pay more in principal to save on the interest rate. I can’t wait though. I’m going to invest my daughter’s college fund on a property next door and I’ll need that money back by October. So, I have to buy it now.

  42. Kris

    I apologize if this has already been addressed but how was the rent *160 estimate derived?

    Thanks

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