Send In The Clowns — Stephen Sondheim / Frank Sinatra
This market desperately needs more knife catchers. There are just too many properties that need to be sold and too small a number of people to buy them. I suppose we aren’t helping matters any at the IHB ;).
I hope everyone is getting a laugh out of the daily posts here. The carnage we are witnessing — and will continue to witness — isn’t funny for the people losing money. Residential real estate bubbles are very painful when they deflate. I vacillate between sadness and laughter reviewing these properties all the time. You have to be able to laugh at the grim happenings in life. Life is too short to be bummed out all the time.
Today’s featured property is another speculator who is getting flushed out of the housing market. Not to worry though, he has extracted all the equity and is passing the loss on to the lender.
Asking Price: $549,000
Income Requirement: $137,250
Downpayment Needed: $109,800
Monthly Equity Burn: $4,575
Purchase Price: $612,500
Purchase Date: 8/30/2005
Address 114 Townsend, Irvine, CA 92620
| Beds: | 3 |
| Baths: | 3 |
| Sq. Ft.: | 1,876 |
| $/Sq. Ft.: | $293 |
| Lot Size: | – |
| Property Type: | Condominium |
| Style: | Contemporary |
| Year Built: | 2005 |
| Stories: | 3+ Levels |
| Area: | Woodbury |
| County: | Orange |
| MLS#: | S536663 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 2 days |
Resort like life style,this beauty has 3 bedrooms,3 baths,one bedroom
and bath on first floor,kitchen and living room and dining room and one
bed and bath on 2nd floor and master bedroom on 3rd floor.Fantastic
floor plan for active families,upgraded kitchen w/granite counter tops
and upgraded cabinetries,clean and bright home.
Note to realtor: in English, we put spaces after punctuation marks.
This property was purchased in late 2005 for $612,500. The owner put 10% down. In September of 2007, he managed to increase his credit line on his HELOC to extract all his equity (I can’t believe a lender approved this after the credit crunch in August.) Of course, now the lender is going to eat the loss. It isn’t likely this will sell for its asking price as it is probably 10% over market, but if it did, the total loss after a 6% commission would be $96,440. The lender must feel really good about extending that HELOC.
Thus concludes another week at the Irvine Housing Blog. Come back next week as we continue chronicling ‘the seventh circle of real estate hell.’ Have a great weekend.
🙂
.
Isn’t it rich? Are we a pair?
Me here at last on the ground and you in mid-air
Send in the clowns
Isn’t it bliss? Don’t you approve?
One who keeps tearing around and one who can’t move
But where are the clowns? Send in the clowns
Just when I stopped opening doors
Finally finding the one that I wanted was yours
Making my entrance again with my usual flair
Sure of my lines
Nobody’s there
Don’t you love a farce? My fault, I fear
I thought that you’d want what I want, sorry my dear
But where are the clowns? Send in the clowns
Don’t bother they’re here
Isn’t it rich? Isn’t it queer?
Losing my timing this late in my career
But where are the clowns? Send in the clowns
Well, maybe next year
Send In The Clowns — Stephen Sondheim / Frank Sinatra
Today we have a much better, in terms of rooms and size, starter family residence than the one profiled yesterday.
$2500 rent at GRM160 = $400k. Someone who either cannot wait or for some other reason may catch this near $500k in today’s market this selling season.
And from where did you pull your $2,500 rent statistic?
In one Irvine Co. apt, Villa Siena, $2,500 gets you a 2/2 @ 1,296 sq ft. The featured property today is a 3/3 @ 1,876 sq ft. http://www.rental-living.com/Communities/Villa-Siena/Prices-And-Floorplans/
That may be true, but Villa Sienna is in a far better location, imo. Woodbury is far away from the ocean and most businesses where people work. It’s also hot.
Hit craigslist and keyword Irvine and select 3BR+
There are 817 ads. (which includes all the 4,5,6 bedroom places)
Set a max of $2500 and you get 466.
Set a max of $2400, you get 355.
Set a max of $2300, you get 227
Set a max of $2200, you get 125
Many look to be IAC.
Perspective:
Sorry I did not provide evidence or proof of my estimate of $2500 monthly rent for this place.
In fact, I am not living any where near Irvine. I am a resident of NYC metro for 20 years. I have visited Irvine three times.
However, I believe I have learned a little about Irvine market by reading and posting in IHB.
How much do you think this place would rent for?
Wow. How much did they pay to stage this place?
Half a million dollars and the property has yard sale furnishings.
It is a pretty home. Aren’t the HOA fees really high tho?
One of the beds having no pillows was what confused me.
This is a good illustration of how cramped 1800 sq ft can look if you stretch it our over 3 levels.
Who wants each of the bedrooms on a different floor? Odd. While yesterday’s property was an example of what good things bubble building can do, this is an example of the questionable architecture that bubble money also feeds. IMO.
My daughter initially liked the idea of the three level thing. She liked each bedroom on each floor as a sense of privacy for a roommate situation.
Personally, I never really “got it” because I couldn’t see anyone with ambulatory issues living there. Also older people in general and anyone with a baby or young children would not do well in a steep tri level.
She has since looked into the idea of these QH homes, which we visited as models, and doesn’t care for the plans. She tells me that the stairs are actually part of the square footage, and are actually counted DOUBLE in terms of square footage.
Is that true? I think she said she read that here someplace. It would make sense, because when you are in those units it really seems like quite a bit of square footage is simply missing.
Three level condos are rip-offs. Many times they do count all the stairs as the square footage and there is a lot of wasted space under and around the stairs that gets counted as well. Overall, when I looked at many of these tri-level designs they seemed very cramped.
I think most of the newer condos in Irvine tend to have these types of floorplans, that’s why I would look in older areas of Irvine like TR.
That bed is missing more than pillows — it lacks a headboard. It’s just a cheapie metal frame that they throw in for free when you buy a mattress/box springs. But the larger point is clear. They are spending all of their money on the house and don’t have any left over for all the other expenses of life.
I always wondered what it would be like to live in a treehouse!
Seriously, three stories people? That means anytime you want to go upstairs to change your underwear you have to walk up two flights of stairs? LMFAO! Oh crap, I forgot my sunglasses and now I have to sprint two levels! I guess you won’t need that overpriced 24hr fitness membership to use the stair stepper machine anymore.
I’m guessing this ridiculous design is due to cheaper construction costs (no public stairwaays, less fire codes, etc). If there anyone who is knowledgeable about construction of these type of units, please chime in.
IMO, traditional high-density designs where your entire apartment is on one floor (you just walk upstairs or take an elevator to get to your unit) are much better.
I lived for many years in a house in Ann Arbor Michigan of the type that a friend called a “wife-killer”. Laundry in basement, main floor with living area and 1/2 bath, second floor with bedrooms and bathrooms, attic remodeled for the boys. There was a laundry chute to send clothes _down_ — up was a different matter. Trying to save a bit of energy, I would leave the boys’ sheets on the second floor landing for them to take up and make their beds. Do you know how long a teenage boy is willing to sleep on a bare mattress rather than carry a set of sheets up one lousy flight of stairs?? A very long time, that’s how long. Long enough for some entertainment event to come along that would force me give in in order to get the sheets off the landing and up the stairs. It’s one level for me, forever more.
There can be quite a temperature difference from the top floor to the bottom. Especially when it gets hot. So heating/Ac efficiency can be quite a challenge.
Besides all this, should we shoot the architects who designed these building.
Speaking of clowns. Check out the self-serving bio of the realtor. If you can make it through the entire thing without blowing Kool Aid out your nose, I commend you.
http://www.mikeandmary.com/profile.htm
http://www.crackthecode.us/images/mikeAndmary.jpg
HAHAHAHAHA I laughed so hard, I farted !
Talk about getting way drunk on the Kool Aide!
What clowns! These realturds will soon be unemployed as well.
Good one, AZ.
Can someone explain what they mean by:
“No quality, no business, he says simply – and the couple’s professionalism reflects that standard.”
Having no quality and no business sounds like a standard far below what these two are capable of.
Or maybe this is to prepare clients for the current market?
The entire bio is full of fluff and needless filler. Almost like reading an infomercial.
My favorite section is the “Real Estate Educations”
Real Estate Brokers and members of:
National Association of Realtors
California Association of Realtors
Multiple Listing Service
Orange County Board of Realtors
CMMS, Licensed Real Estate Broker
CMIS and Certified Relocation Specialist
Oh wow, they pay dues to a bunch of dysfunctional organizations they must be EXPERTS!
The “experience and background information” section is just as funny. No substance. It’s like looking at someone’s bad resume and feeling sorry for them.
How do I know that out-in-the-field-Mike was not flipping cheeseburgers before he sold his first house?
Doesn’t wash with me.
I get a kick out of the realtors that present themselves as “rooted in the community”.
How many times have they flipped houses to jack the newcomers entering the “community”?
I love reading about realtors getting burned on their “investments”.
Sorry, no sympathy.
This is a really good example of what to look for in a mate: no alliteration.
My god, I think Mike and Mary want me to kill Mike and Mary for Mike and Mary’s sake.
Thanks to IR for giving my co-workers and I endless breakfast entertainment. I almost feel guilty for not paying for it. This is much better than 90% of my sat tv.
Listing Realtor notified of today’s featured property?
Check.
David, I hope you signed up for their newsletters.
😉
Indeed. I am highly interested. Bet the wife is starting to get annoyed at out-in-the-field-Mike these days; having a hard time finding 800K house chumps – I mean clients.
It looks like these two gravy-train monkeys have been riding high on the hog for quite some time.
Can you really rent that for $2500 a month?
No, not in today’s market.
This will be renting for $1900 easily this time next year.
My rent has actually been going DOWN for the last 2 years, and suspect it will go down again this year…
Falling rent? That cannot be good news for the bulls. Looks like using present-day GRM to predict eventual bottom prices is no longer credible.
“Looks like using present-day GRM to predict eventual bottom prices is no longer credible.”
It’s still credible. The bottom will just be lower, that’s all!
“Looks like using present-day GRM to predict eventual bottom prices is no longer credible.”
It’s still credible. The bottom will just be lower, that’s all! ”
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Ah, music to my ears. 😉 I guess when those
AltA and Option Arm resets next year, it will
be a driving factor for lower GRM perhaps?
IrvineRenter, and thoughts on this ?
We put our Irvine condo on the rental market last February. It’s an 1,100 sf 2/2 and, basically, we just said “whatever rent we can get for decent people is what we rent it for.” Market rent is market rent, so wishing for higher is just as delusional as some of these WTF asking prices.
By the way, we got $1,675. The complex is over 50% rentals and my neighbor landlords aren’t too happy since they say “market” is $2,200. To me, market is what somebody will pay. Rents are definitely on the way down in Irvine…..
Doesn’t surprise me with all the local layoffs in the area.
Thanks for the update. I thought about renting mine out as well, it’s just a little bigger (1250 sq. ft. w/2 car attached garage) and I might be able to get $2k if I’m lucky. Oddly enough, my neighbor below me rented his 1 bd for $1500!
Absolutely go with a RE agent and give the “finder” agent like $500 bucks if the new renter passes the credit checks, pays the higher rent and signs for a year.
Please DO NOT UNDERESTIMATE THE GREED AND OPPORTUNISTIC nature of RE agents. They can really deliver if the incentive is right.
We consistently got good market rental rates by doing this. The finder agents will put job transfer people in your place – who are not aware of what the real discount rates could be. The renters will be in a new location and they will be committed for the year. They may want to negotiate with you at the end of the term, but some won’t care.
I know of an excellent RE agent we have used off and on for years for various properties and various rentals. She’s honest and reasonable and been in business for several decades. I have no hesistancy in recommending her.
I can post her name or can send it in PM if you are interested.
That’s interesting.
Sure send her name over to:
kurt_kawczynski@yahoo.com
I’m working with an agent right now who’s pretty good, but it never hurts to get another good recommendation.
I go back and forth between renting it out or not. I’m a simple guy and don’t like a lot of hassles…that’s why I’m leaning towards selling.
Good luck! There are buyers and renters out there. Try and get yourself a match for the best rents you can expect.
Hope you got the email
OK thanks, I’ll check it when I get home from work…
Yes, I would like his/her name please.Thank you.
I think Thornberg is right on the timing, but I don’t know if it will be 50%…I could see another 5-10% but that’s it.
Although, my guess for a 15% drop was way off too 🙂
Very minimially upgraded compared to many properties in Woodbury. It probably needs 80K worth of work IMO. The tax rate is 1.8%+, which is what stopped us from looking here months ago.
I like the Woodbury community, but am always turned off by the extra $700 or so monthly fees that you have to pay for HOA and Mello-Roos
Woodbury reminds me of Florida — the Palm Beach area sprawl. The only thing missing is the category 5 to wipe it all out.
Seriously, who would travel to a fake resort armpit, let alone live in one?
has anybody else noticed how all the foolish decisions made by millions of sheeple in the cheap-gas era (which i hope never returns) are now leading to their financial ruin?
they built ugly huge mcmansions that now cost a fortune to heat. they moved a zillion miles from town, driving up their gasoline bills. they added to those gasoline bills by buying phallic, supersized SUVs.
now they can’t sell those houses or those vehicles, and since these s—ts for brains couldn’t afford to pay cash for anything, they are stuck with making payments on houses and vehicles that are rapidly draining their inadequate savings.
could anything be more delightful? -)
“now they can’t sell those houses or those vehicles, and since these s—ts for brains couldn’t afford to pay cash for anything, they are stuck with making payments on houses and vehicles that are rapidly draining their inadequate savings. ”
Im ABSOLUTELY enjoying watching the suckers get financially slaughtered! Especially watching my coworkers who bought some reo/foreclosures 6 months ago getting financially WHACKED as well.
And I know things are going to get A LOT WORSE before it gets any better ! hehehehehehehehe Lots more excitement to come. 🙂
snicker.
I laugh when I’m driving down the freeway watching all these drivers of gigantic SUV’s driving soooooo slow!
I remember when gas was cheaper and people had money to burn these jokers would blow by me all the time!
Now I’m blowing by them…in my Civic Hybrid…
lol
Smug alert!
“I laugh when I’m driving down the freeway watching all these drivers of gigantic SUV’s driving soooooo slow! ”
Im laughing right there with ya friend! 🙂
The reason why they are driving slow is because they are in shock, and wondering where it all went WRONG.
snicker…
I don’t mind the SUVs so much… but I despise those Prius drivers doing 65 in the carpool lane.
When I take my wife’s Civic Hybrid ( with HOV stickers ) I make a point of blowing by those Prius…
And I still get 41mpg at 84 mph.. 😉
84 MPH….youll be dead soon….
Over here (Germany) anyway, possibly. Keep it in the far right lane, or you’ll get a radiator up the backside. 🙂
Even at the equivalent to $8.50 or so per gallon, there are still plenty here willing to burn it.
No pillows on the bed but a hideous windchime remains. How very strange..
We rent something similar for around that – a bit more. We renewed and were too lazy to try and renegotiate but yes I think you could rent that for $2500-$2700/mo
Houses without anything on the wall – especially white walls – horrify me. You’d think their realtor would have some stuff to loan them for the pictures at least. They have those great little hooks to hangs stuff up without leave huge holes in the wall. Sigh, I think I’d be a great stager. I might have missed my calling.
They don’t have time to stage.
Mary is too busy sitting on her ass at home employing her extensive contacts and listening skills while Mike is out “in the field” drawing on his years of “seasoned” business and negotiating skills.
“Mary is too busy sitting on her ass at home employing her extensive contacts and listening skills while Mike is out “in the field” drawing on his years of “seasoned” business and negotiating skills. ”
HAHAHAHAHAHAH dont forget the SUPER SIZED box of bon bon’s she’s plowing into her pie hole 😉
Too funny !!!!
I am preparing for attack as I must ask one question.
Why on earth do you people live here? My home is nicer, larger, with better amenties. I have a huge green professionally landscaped yard for my kids and dogs. My kids can to top public schools (6-8% of kids accepted into IVY league colleges and 100% go to college)with no hint of crime or gangs. I live in diverse Midwest (horror) college town.
I know (and respect) that home is home. Yet, why would anyone put themselves thru this grinder of a life.
Help a “rube” understand. What is it?
I am thinking of moving to Austin or Boulder. What does SOCAL have that these places do not???
Good one…I forgot that we have Mickey as well…
Better weather and beaches.
After watching the Rose Parade on January 1st, some midwesterners would pack it up and make the move out here. That’s how its been in the past. I think it has to do with the weather 😉
Why would you be thinking of moving somewhere else when you have it all, where you are currently living?
That’s what I did after growing up in TX and visiting relatives out here every summer!
The day after I graduated from high school, I packed my car up and drove out here and never left!
My brother lives in Boulder, and loves it. But: it gets really truly cold and snows there; theres no ocean; and the area is not so great for jobs. If those are not issues for you, Boulder is one of the nicest places I’ve ever visited, the culture of a college town, a truly great downtown, and the recreational opportunities of the Rockies.
I like the Irvine (SoCal) area because:
— the weather is so nice. You can comfortably eat lunch and/or dinner outside almost every day
— the ocean breeze feels great when you are outside
— bike lanes along roads that you can bike or run in – and you can do this almost every day without weather issues
— there is so much to do that is so close
– beaches and beach cities
– mountains
– bike trails
– running paths
– 6 theme parks
– 4 water parks
– numerous museums and galleries
– much theatre
– TV show tapings
– several zoos
– close to San Diego with even more to do
– lots of outdoor shopping
– lots of concert venues and pretty much any music act that goes on tour comes here
– pro sports teams
– year-round softball leagues and games rarely get rained out
– several art house movie theaters
– several comedy clubs
— tons of restaurants that serve yummy food costing less than $10. And you can eat outside almost every single day. Did I mention that?
— you can drive faster than 35 MPH
— the highway patrol rarely (ever?) gives you a ticket for going 75 in a 65
— grocery stores have good produce
— marriage is legal between two people of the same gender
— you don’t have to worry about your car suffering hail damage
— a melting pot where there is no majority racial group
Mild weather, mostly.
Have to.
I’m in a very small profession with very few jobs; don’t really have much of a choice where to work, so I can’t live in Seattle or San Fran or Boulder where I’d like to.
Wife is constrained as well, but nowhere near the degree I am.
I’ve lived in Colorado and visited Austin in business twice.
Colorado is very dry and the weather is nuts.
Austin is flat… maybe not by Texas standards, but I swear the freeway overpass was the highest thing in 100 miles… Besides it’s humid.
Coastal has the weather, dry climate, culture, polyethnicity and The Happiest Place on Earth.
And our sushi is simply outstanding.
Overall, SoCal has those places simply outdone by a hell of a lot.
I am from the Midwest, but a big city, and I went to school in such a town. I would call what exists here a lack of weather, though — we have outdoor living. Also a large city offers many more things. There is good and bad in both. Those small towns are very boring: they do have one of most things. Most people just can’t wait to escape. I think many people want to get out of this city too. I would say that it is riskier to live in a small town. I don’t beleive the crime stuff, per capita small towns do not compare well. The gang & crime stuff are mainly media creatures, and exist even in the Midwest. Many more jobs here, and you feel like you are part of a world class competition. I would retire to a town like yours.
A different perspective…
1) I stumbled upon this blog/site a few days ago and have had a blast reading all of the postings. Irvine Renter has presented substantial data supporting for a market adjustment. So, I do agree that our current fiasco is a result of
a) greed
b) Helocs
c) 100% financing
d) exotic loans
e) subprime – etc
2) But out of curiosity, IrvineRenter – how much are you paying rent in Irvine? I’m assuming at least $2200-$2300. After all, it is still Irvine and dominated in the rental market by IAC. Besides you’re in Irvine and not a neighbor city like – Santa Ana, Tustin, Costa Mesa, Lake Forest, etc for the following assumed reasons.
a) centralized location – for work
b) family – safety and great public school system
BTW, in those other cities, the rents aren’t any cheaper.
So, let’s broaden out the picture a little bit. A macro look. Irvine is part of the Greater LA area / Southern CA. And SoCal as one study puts it, is the 11th largest economy in the world. Think about it, the 11th largest economy in the world, if it stood alone. So, there are jobs and businesses here. There are world class universities here that will turn out professionals for these jobs. Lastly, our fabulous Socal weather. My point is – there will always be greater demand here then in some other area. There are cities and locations in whe world (becasue of demand) that regular rent/equity ratio fundamentals cease to exist – NYC, London, Paris, SF, Sydney, LA, etc.
Which brings me to my last observation. From reading this blog – I’ve seen numerous “bear” comments about GRM of 160-170 or psf of around $300-$325 or even lower. This would put (assuming rent to be $2200-$2300)an Irvine 1,200 sf nicely kept property to be in a neigborhood of ~$370k-$380k. And until prices reach this point, they’re not going to buy. And according to IrvineRenter, this should occur in 2010-2011. But here is my take – prices will never be that low in Irvine. Not in our current market, not in 2010 etc. At that price level, there will be demand from people from neighborhood cities (not from foreigners, but from our Socal neighbors) wanting to move to Irvine for reasons stated in #2. This would put increase on price pressure. If you had a choice, would you pay a little “premium” to live in Irvine instead of Santa Ana. There will be market equilibrium – i’m not an economist, but i do know that alot of people want to live in Irvine.
So if you’re going to wait for those price levels in Irvine – it could be a long, long wait.
I’m not advocating ridiculous bubble price market that we saw during the peak. But one has to be realistic. If you’re in the market to buy, please be responsible, don’t over-buy to impress, have a down payment, use traditional financing and honor your commitment…
Thanks for reading my post – I know it was little long winded.
Qlogic
Qlogic,
If you really read IR’s postings, did you miss/skip the part about house price and rent being related to income?
people who live in SA, LF, CM can’t buy or rent in Irvine because they don’t make enough.
people in Irvine similarly can’t buy.
If you make the Irvine median HI of 85k, that means that you are able to afford $250k-$325k.
Do you really think that your household will be happy in a 2/2? How will someone making $85k afford $500k without “fancy” financing?
Yes – some, actually alot will be priced out of Irvine. But in life, there are compromises and sacrifices. So with a dual income family – hopefully they’ll save enough for a sizable down and can afford the monthly mortgage. Again, i’m not an economist – and i know living and earning a decent wage in SoCal is difficult…
Will a household be happy with a 2/2 – that’s all relative right. It’s all about compromise. I would be happy with a 3000sf house with 5 bd / 3 bth – but i wouldn’t live in the Victorville for that. There are trade-offs.
You just have to sip a little Kool-Aid and be willing to spend your entire income on your house.
Not everyone wants to live in Irvine, there are groups of people that don’t need and don’t want want to pay extra for what Irvine has to offer, they can find a better deal elsewhere, why to pay extra for HOAs and Mello-Rosse tax?
The market that Irvine serves better is: young couples with plans to have kids in the next 1-3 years or families with kids K-12, a double income household can afford this.
And because Irvine is oriented to this demographic, is boring to death for young adults and very expensive for retired workers.
You almost sound like a realtor trying to convince a home buyer in 2005, but you failed at this because you forgot to say something like:
“A lack of developable land, years of underbuilding, and a huge surge in population due to Southern California’s desirability as a place to live have engendered a serious imbalance between housing demand and supply.
Adding fuel to the fire is the fact that Southern California’s wealth has grown significantly due to its robust and diverse economy. With all these factors at work, we are told, it’s no wonder that home prices have risen so spectacularly.”
😉
You assume there will be demand from neighboring communities. I don’t agree. Those neighboring communities are getting clobbered as well.
Incomes don’t support the pricing. That’s the problem now, and it will be the problem two years from now – but worse.
Prices were at the 370k to 385k level pre-bubble.
Prices everywhere went up 2.5 times – not just in Irvine because it is somehow special. Lax lending standards caused the bubble and I doubt this expiriment will ever be attempted again.
So to say prices will never reach a level they were at prior to the bubble seems to ignore how difficult an environment we are in right now – and it’s getting worse…
Chris Thornberg: Possible 50% House Price Declines in SoCal
by CalculatedRisk
From Jon Lansner at the O.C. Register: SoCal home woes could mean 50% price drop
[Economist Chris] Thornberg, founding partner at Beacon Economics and former UCLA economics professor, said home prices would have to fall about 40% from peak to trough to return to the historical norm. But add in the impact of rising gasoline prices, the subprime mortgage meltdown and rising foreclosures, and it’s likely prices will fall 50% peak to trough.
The S&P;/Case-Shiller index shows that prices for the L.A./O.C. area are down 24% from the peak, so the region is about halfway to the bottom, Thornberg said.
In Orange County, price declines will be more severe at the bottom of the price spectrum than the top end, but “the top end is going to get hit, (too),” he said.
That will be a rude awakening for many homeowners suffering from what he called “homallucinations,” or the ability to convince oneself that while the price of everyone else’s home will fall, your neighborhood is clearly different.
I think Dr. Thornberg is optimistic on the timing (he sees the price bottom in mid-to-late 2009). This might be true for low end areas, but I expect prices in the mid-to-higher end areas to be a little more sticky – so the price declines might take a few more years.
http://calculatedrisk.blogspot.com/
Possible 50% DECLINE in SoCal ? OUCH !!!! However bought a house this year in SoCal is SoStupid ! har har har
SoCal
I agree its beautiful there and, yes, I personally know a person who visited once and then came home and moved.
FYI, we have diversity, art, indie c/movies, bike paths, etc where i live – but it can get cold!
Next Issue
Why i find this blog interesting is that I did not previoulsy understand the reasons for the pent up demand for home buying that led to the SOCAL bubble. There was a rent “stigma” in SOCAL that did not exist to the same extent where i live. I, of course, heard the stats, yet did notfully comprehend the amount of professionals/middle class who could not afford quality safe housing.
I believe IR has it right with his “pergranitesteel.” It was about demand, supply, and EGO.
I have been heavily in the stock market for years, bubbles dies when nobody would think of buying. As long as “retaiL” still believes that REOs, short sales, foreclosures, are “Bargains” they ain’t bargains yet. We are, IMHO, 1/3 into this correction.
My true belief is that – like Michigan – many parts of our economy and country will never fully recover from this.
A new paradigm is settling in on U.S. We are no longer a superpower and we will no longer have the same amonut of people in our “middle class.”
S&P;Research Downgrades BofA
by CalculatedRisk
From MarketWatch: S&P;cuts Bank of America to sell from hold
“We take unfavorable note of the large Countrywide option-adjustable rate mortgage portfolio that Bank of America will inherit, since we believe this portfolio has yet to be stress tested,” S&P;said in its action.
Not stress tested … yet.
The losses are coming for these Option ARM (and HELOC) portfolios.
http://calculatedrisk.blogspot.com/
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DOUBLE OUCH !!!!!!! Like I said before, whoever bought a house in SoCal this year, is SoStupid.
The Option ARM tidal wave is comming folks! Get ready for the next leg DOWN ! Weeeeeeeeeeee !
I think $1900 a month for this place is reasonable for rents. Today.
$1900 x 160 = $304K.
About 50% off.
I reserve the right to revise my forecast down if rental prices continue to slide.
Sorry IR, you and I are homies, but I think $2500 rent/month for this place ain’t gonna happen.
Post the email of your choice and I will send it.