REO pricing is starting to really pummel the bottom of the market. Today’s featured property is being offered for 50% less than its peak purchase price.
Asking Price: $244,900
Address: 27 Snowberry #33, Irvine, CA 92604
Make Me Laugh — Christina Milian
Now you’re running ’round talking looking like a fool
I’d like to know what you goin’ do and now who’s laughing
Jokes been played on you
I have my own emotional measure of progress toward affordability. I openly ridicule WTF prices whenever I see them because, quite frankly, they make me angry, and the ridicule is deserved. For a very long time, most of the listings were in the OMG price range, and much of the high end is still there. However, lately I have been seeing prices on properties that do not completely offend my sensibilities; these prices merely make me LOL. When I first saw today’s featured property, I did not think OMG; That is progress.
When I first predicted house prices would fall, this is exactly the kind of deal I believed we would see–just not this quickly. It is very unlikely that we are at the bottom, but we are making huge strides toward genuine affordability. Someone will buy this one and weather the drawdown that follows. Many of us who buy when affordability returns may experience the same outcome. I am not going to try to time the bottom tick of the market; although, I will wait to get closer than today’s pricing. Unless you are going to wait until a new uptrend is firmly established, there is a very good chance the property you purchase may be worth less than you paid for quite some time. I will be OK with that as long as I am saving money over renting. Unfortunately, we are not there yet.
{book5}
Asking Price: $244,900
Income Requirement: $61,225
Downpayment Needed: $48,980
Monthly Equity Burn: $2,040
Purchase Price: $488,000
Purchase Date: 1/30/2006
Address: 27 Snowberry #33, Irvine, CA 92604
| Beds: | 2 |
| Baths: | 2.5 |
| Sq. Ft.: | 1,150 |
| $/Sq. Ft.: | $213 |
| Lot Size: | – |
| Property Type: | Attached, Condominium |
| Stories: | 2 |
| Year Built: | 1975 |
| County: | Orange |
| MLS#: | I09045252 |
| Source: | MRMLS |
| Status: | Active |
| On Redfin: | 2 days |
This property was purchased on 1/30/2006 for $488,000. The owner used a $390,400 first mortgage, a $97,600 second mortgage, and a $0 downpayment. The property went back to the bank on 1/23/2009 for $372,000. It has taken 3 months to get it on the market. If it sells for its current asking price, and if a 6% commission is paid, the total loss will be $257,794.
This is the first property I have seen in Irvine priced 50% off.
{book4}
You can’t blame me for hatin’
But it’s funny how you thought you can
Let your little secrets pass by me
And try to get them not to like me
I was being good to you
Now you’re running ’round talking looking like a fool
I’d like to know what you goin’ do and now who’s laughing
Jokes been played on you
Got me thinking about
You make me laugh
All the things you’re doing, trying so hard
Just to ruin me but you can’t see
You make me laugh, cuz you’re running around
You make me laugh
You try so hard to be down
Talking ’bout me when I’m not around
But you don’t get that you make me laugh
Make Me Laugh — Christina Milian
If there is a spring rally in Irvine, we will be going against the national trend:
Case-Shiller: House Prices Fall Sharply in February
Looking at the charts in the post, I detect no signs of bottoming. We may be at the inflection point where the rate of decline reaches its zenith, but even as the rate of decline lessens, prices will still be declining.
“The Composite 20 index is off 30.7% from the peak”
When I first wrote about the bubble on a national level, I foresaw a 30% drop nationally. We have already hit that number, and prices are in freefall. That is scary.
Of course there is the BS spin on the matter:
Home prices tumble, but no new record
“Home prices dropped sharply in February, but for the first time in 25 months the decline was not a record, another sign the housing crisis could be bottoming.”
WTF? Prices decline sharply, but the market could be bottoming? Because a huge drop was not a record drop is encouraging?
They are missing an essential point. SB 1137 slowed down California’s decline. The other 17 cities in the Case Shiller index had prices dropping faster than a year ago. For Los Angeles, San Francisco, and San Diego, the declines slowed, but will be picking up quite a bit of speed now.
On another note, the following 8 cities are below Jan 2000 pricing, when adjusted for inflation: Phoenix, Denver, Atlanta, Detroit, Minneapolis, Charlotte, Cleveland and Dallas. They will be joined by Las Vegas and San Francisco next month, and Chicago by summer.
We’re nowhere near Y2K prices here in Chicago yet, at least in prime neighborhoods.
Only the least desirable neighborhoods have fallen to this level.
We still have quite a ways to drop here.
You never hear much about Chicago. I remember visiting Hinsdale, IL back in the late 90’s when there was a huge building boom going on. Builders were all over the place ripping up old homes and erecting McMansions in their place.
Without inflation adjustments, Chicago prices would have to fall another 15% to get to Dec 2000 levels, 20% to get to Jan 2000 levels.
It was a medium bubble in Chicago, a 70% rise in 6 years.
I live in the NW burbs of Chicago, and about 18 months ago, I started looking at 2BR condos/townhouses in the neighborhood. Back in January 2008, there was only one listed for $150K, and it was on the direct approach path to the local airport. Now, however, there are more than 20 listed in the $100K-125K range, most of them short sales or REOs.
> We may be at the inflection point where the rate of decline reaches its zenith
I can’t believe I just saw the term “inflection point” used correctly on the Internet. I’m pinching myself!
Thanks!
Yes, but it’s amazing how many reporters confuse price level, with rate of decline, or rate of decline with acceleration of price drop.
There is a good amount of seasonality in the Case Shiller data. People shouldn’t confuse spring with a stable market. When you adjust for seasonality, prices are dropping faster than a year ago.
Jim Cramer suggested we plow under the Inland Empire. Apparently, it is starting to happen. Video here:
Extreme Home Makeover Depression Edition
Looks like those were in Victorville. None of this in Riverside.
This guy is a Ron-Paul-will-save-the-planet-invest-in-gold type, but you can’t argue with what he’s taking videos of.
Look at these two:
https://www.youtube.com/watch?v=mWLyd9Jaxtg
This one starts off with a sign that says: 45 brand new homes FOR RENT-$995 monthly
Never seen a builder give up and rent out the whole tract before.
Or, they could give up like this:
https://www.youtube.com/watch?v=fCi11gUFGfU
The model homes have been abandoned (not sold or rented, just vacated with the furniture removed but the model home signs and fencing left), and the A/C units stripped.
I should note that this is all deep in the desert; nothing like this has happened to my knowledge in places like Riverside-yet.
Can get a loan on a condo? We just did a refi on our house and the broker/lender were very adamant that they would NOT do condos.
This was on a refi with a figure around 40 LTV as of April. They had no interest whatsoever on condos. According to the broker she was only doing SFHs.
So, I guess unless you came in with a 50% cash payment (likely much more) the lender will not lend the money or charge you quite a bit more in points and interest rate.
If lenders are hesitant to loan on condos, that will guarantee downside overshoot.
We are currently refinancing our condo with B of A. No problems at all. Wells Fargo was willing to refinance too, but B of A had a better deal.
Because you have equity. It doesn’t mean they will loan someone else money to buy your condo if you were to try to sell it.
Did the lenders by any chance mention something about crazy condo fees due to other condos being vacant, or the owners not paying? Perhaps something about being worried the condo association won’t pay for insurance or maintenance because they have no money?
Per the broker, my understanding is that the pricing on condos is more unstable (elastic) than on SFHs. Lenders feel more comfortable with SFH pricing.
So lenders really don’t know what a fair LTV is. They tend to want higher numbers for a condo than for a SFH.
Besides, in Irvine most homes are in HOAs so we all have to pay HOA fees, some more than others. But, you do make a point. In a SFH, stuff like insurance and maintenance is mostly born on an individual basis while the common ground maintenance is a much lower cost per unit basis.
It appears that houses hold their value better in downfalls than condos. That is, if a condo was worth $300,000 at the peak and a house in the same area was worth $500,000, chances are that the condo might now be worth $150k and the house worth $300k. That is, the condo dropped in value by 50% but the house dropped by only 40%. I’m sure somebody can dig up some numbers to confirm (or refute) this.
This also means that a condo might be a better investment now, if you think the process will reverse.
I owned in San Clemente for 21 years (1978-1999) and followed condo vs home prices in the area. During that period SFH always appreciated more and depreciated less. Even in the last 8 years I think that has held true.
Several expensive new condo developments in Miami were recently written up as an example of how remaining owners are left holding the bag when large numbers of speculators simply abandon their investments. HOA fixed costs are high and only a few owners is not enough to maintain the building(s); hence the banks conservative approach to loaning on them vs a SFH.
I have a condo in Irvine and we just refi-ed with no problems (no points and very competitive interest rate). As always, I think it comes down to the lender and each individual property but our refi was very easy.
Agreed. I think it is not condo per se. It is valuation , LTV and income multiple.
Fannie announced it was tightening lending standards for condos back on March 1st.
“The government-backed mortgage-finance company stopped guaranteeing mortgages in condo buildings where fewer than 70% of the units have been sold, up from 51%. In addition, the company won’t back loans for sales in buildings where 15% of current owners are delinquent on association fees or where more than 10% of units are owned by a single-entity.”
http://online.wsj.com/article/SB123733304341863319.html
I was wondering when this was going to start affecting people.
How would a potential buyer obtain this information? Is it publicly available? Or would I have to rely on the Realtor to do their diligence.
I was wondering how long it would take for builders to start giving up and converting to rentals. This pretty much leaves existing buyers in a bad spot.
There should be some new laws passed here to help out the homeowners who purchased into a community to protect against HOA spiking. If buyers get hit with high HOA’s, simply because there aren’t enough of them to cover the cost, that can leave the whole community in a bad spot.
You know…why the hell do people still buy houses with LTV? Why not just do cash only?
Oh I forgot..this is America..land of the credit cards. Nevermind……
BTW, Schedule A cheats you out of your standard deduction.
Is it just me? This is really ugly.
Rent saver or cash flow investor’s only for this one, no curb appeal.
That’s the rub:
Many properties are approaching (or have reached) rental parity, but what owner-occupier would actually want to live in these dumps?
I would, you f*&king; snobs. Not everybody can afford to live in their dream home.
Nice to know that I’m not the only reader of this blog that isn’t sitting on $80,000 waiting to make a 20% downpayment on a house when the market bottoms.
You just need to switch to the Ramen Noodles and only eat twice per day. Then you can spend 50% of your income on rent and save a few hundred bucks a month. You will be on your way to 80K in notime.
Right, and if you switch from electric lighting to candles, do all your laundry by hand, cook using a clay pot and a firepit, and stop using your phone, Internet service, and cell, you’ll be able to save on your utilities and have even more money to put back!
. . . I used to suggest this to people who urged me to buy in CA back when the bubble was first inflating. They actually thought it was all a great idea on my part.
IrvineRenter –
One of these weekends you should rally the troops for a IHB Camp-out where everyone brings their own tent and beer.
Set it up the camp in some fancy pants Irvine neighborhood where a bunch of people will drive by and be forced to look at it. When the local NEWS media shows up to ask about what you are doing, you can tell them that housing still is not affordable so you are living in your tent for the weekend.
Can you imagine the horror on the faces of those who drive by to see a Shantytown in their back yard?
Would be a great publicity stunt.
You know my biggest source of savings (aside from being a renter)?
Not being in debt. I pay no interest on anything. No car loan saves about $100-150/mo on a $20k loan. Avoiding a $5000 credit card balance is about another $100/month.
Of course, those pale in comparison to two other items. No mortgage payment on an overpriced home is a massive savings, like $4000 a month on a depreciating asset for a $1 million loan.
Getting completely out of the stock market in 2007 and going to cash was a really good move. Then I put most of it into muni bonds and carefullly selected distressed corporates. Doing exceptionally well so far.
MalibuRenter: Nice to see someone else shares a financially conservative approach to shelter and managing investments. I sold all mutual funds starting in late 2007, took less of a loss than some and reinvested only in DIA which have seen some appreciation. However, am now selling them since I thinke we’ll see another drop of at least 15%, probably more, from present levels in the market.
Did invest in a conservative high yield corp mutual fund but too much volatility so sold at minimal profit. How do you research the high yield corp securities? Do you plan to hold them til maturity? Are all your munis general obligation type? Lastly, hope you plan to continue keeping up with and writing to Irv. H. Blog about so cal real estate when you move to Dallas. Your opinions are valued.
I think he already has that $80k (he’s **sitting** on it).
I doubt anybody reads this, but I’m posting it anyway.
David,
Nicely played. For the first time in a while, I lol’d at a blog post. Loud.
I agree, certainly grim looking, but on the other hand, it does not back right up to Culver or Interstate 5
There is at least a strong implication that it is lacking more than just curb appeal. I wonder what it will cost to make it pass building, health and safety codes, and be livable? And of course, what is the condition of the rest of the condo property and the HOA?
If it is fully depreciated since 1975, in fact as well as in accounting terms, the price might still be $244,900 too high. I recall reading about people buying houses in Cleveland for $5,000, only to find out that besides back taxes, they had no choice but to spend another $5000 or more to tear it down. I presume no place in Irvine is really that bad, but the next owner might have to put a lot into this place in addition to the purchase price.
Irvine, no. However, homes in Riverside and the high desert are being torn down.
High desert, yes, in rare cases (like in the video in one of IR’s comments above, where they tore down five new houses built in the middle of a huge field). Riverside, not to my knowledge, except maybe in the hood (I can see a few very old houses in poor condition in the worst parts of town being demoed one at a time).
I don’t understand why anyone would buy now just because they think rental parity has been reached.
If you pay $100 more monthly to rent than the comparable price to buy, because you’re waiting for bottom, and you rent for 2 additional years and overpay $2400 but ultimately purchase a house that is $600,000 today but that will be $480,000 in 2 years (additional 20% price drop), you are so far ahead in the long-term.
What you say is true. However, when prices drop below rental parity people save money each month by buying. As long as rents don’t go down much, they would continue to save money, even if they would have been better off buying later.
Personally, I would still prefer to buy later and save even more money. Some people are impatient, or just don’t believe prices will fall much further. Those who believe that prices will be at least as high as they are currently in 5-7 years when they might move are probably wrong. At least they have a somewhat plausible scenario. People who think prices will be higher next year are crazy, stupid, or aren’t playing with their own money.
Housing is an emotional investment but it’s still an investment you put in money and your life into it. Many just don’t feel that connection in renting they feel they are wasting their time. They want roots, neighbors and something to call their own.
But buying a home is still an investment and you have to look at it this way unless you don’t care about what you do with your money. Considering it’s so expensive to live in CA we have no choice but to try and live within our means.
I want to own my own home for 2 main reasons:
1) I want to know that I’ll still be living there a year from now. Currently I rent on a year-to-year lease. I’ve been here nearly 6 years. But each year I honestly have no idea if I’ll be signing a new lease or not. I hate that feeling.
2) I want to be able to customize the home how I’d like. This house needs new carpet and a new floor in the kitchen. I don’t want to spend my own money to fix it. I am afraid to ask the landlord because he might raise the rent to pay for it. I’d like to install air conditioning. I’d like to replace the sliding glass doors in the house. etc.
People who buy on emotion are suckers; a real estate agent’s bread and butter.
I want to own my own place because I am tired of cutting a check to a landlord or a mortgage pimp each month.
I want a place where I do not make payments.
Borrowing money from a bank is not owning; it’s just a perverted form of rent-to-own from a bank. Either way, you own nothing until the thing is paid for.
I understand where you’re coming from, Dave. Personally, I’d like to buy my own lot and build what I want on it. Unfortunately, I just took a look at lot prices–and they’re almost at WTF prices in Phoenix and the surrounding areas. :S
People buy homes because for most of them it’s the only investment they can understand and visualize. It meets many needs which is why if you have a good credit rating our banks are more than happy to see you spend thousands above the real price in payments each month. And for most a payment is the only way they know how to save. As evident in the majority have 10k of debt on credit cards (hopefully not us here).
It’s really a great way to keep American’s in debt unless you are smart enough to pay more in principal each month or you can qualify for a 15 or less year loan.
This way at least paying off your loan sooner thus actually being a real owner. The problem with housing here in CA it’s been abused and used to inflate the state causing all other areas of public spending to go up in price.
You hear of the public sector making overtime from blue collar jobs to executive pay all of this forces everything up in price.
The more we gain the more we spend causes prices to go up along with taxes. It’s a vicious cycle. Someone wins–many lose.
http://www.ocregister.com/articles/overtime-firefighters-fire-2374818-percent-ocfa
This from Mathew’s blog:
Notices of default, which initiate the foreclosure process, rose in 76 of 84 ZIPs tracked by DataQuick in the first three months of the year vs. the same period in 2008, or roughly 90% of ZIPs.
And in 67 ZIPs (80%), NODs reached the highest level in at least the past two years
And Irvine is leading the charge:
92604 up 107%
92614 up 89%
92612 up 78%
92618 up 64%
92602 up 43%
92603 up 43%
92620 up 24%
92606 up 18%
92603? Turtle Ridge? Bonita Canyon?
Yeah, it’s interesting over at ForeclosureRadar.com if you type “Irvine” into the search box at the bottom with no price criteria. Lots of results now.
Great site – I’ve lurked for several months to try and obtain a perspective on what’s happening in a truly distressed market.
:question: I live in Dallas so I’m not really up-to-speed on the whole “OC” vibe, but I gotta’ wonder why ANYONE would pay more than 150K for a condo built more than three decades ago. Forget proximity to schools, shopping, jobs, roads, etc. It’s approaching the end of its usable life.
Here in the center of America one can purchase 3K SF NEW constuction with an inground pool for 250-300K. I’ve traveled extensively in California and while I appreciate the great weather, vinoculture and proximity to the ocean, I fail to understand why it would cost 4X as much to own a home there.
Dean, this is where we live, work, raise our families. The prices come with the territory I guess. Although I wouldn’t pay $450K for my 3/2 condo if I had to buy it today. We’ve lived in Irvine for over 25 years. I don’t want to live in Dallas as much as you don’t want to live in Irvine.
Dallas is a great place and Irive is extremely over rated. The builders and city managers along with RE, speculators and others pumped up this market many bought to resale and cheap money sent all the prices up. Everyone knows this it was not because of the ocean that few have access too. Look at Florida has tons of beach space and a warm ocean. I have lived many places and this area is actually less friendly, less things to do, less life everyone works to pay for their over priced homes. And everyone is out to make money off of you.
When you have lived in other places you can see the many downfalls of Irvine. The good is the feeling of security but you wonder if that has to do with the type of people living here who value education above everything. That is really the big difference.
And why to get ahead to buy one of our million dollar homes.—LOL—
I really don’t like it when people say “everyone is this or that”. I’m not everyone. I grew up in Michigan, I lived in Florida for a few years, got married and we landed in an Irvine rental and then bought in 1993. We don’t live in a million dollar house. Not everyone here is rich. Sure some of the high school kids have the expensive cars, but my daughter inherited my 10 year old Camry. I’ve worked for 20 years at the same employer (a large university) and when I retire in a few years I will have a pension, full benefits, a 401k which hasn’t lost value because I have it in a safe savings account and a cute little condo with a low monthly payment. My little neighborhood is full of hard working parents sending their kids to public schools.I didn’t bash Dallas. I just said I don’t want to live there as much as Dean doesn’t want to live in Irvine. It’s a big country. Oh, and I’m a proud 7 year stage III cancer survivor who went through a year of hell to fight for my life.
Yeah I’ve lived in many places (MI, FL, TX, PA, northern california)…each time, i’ve come to miss irvine more and more. I don’t want to live in dallas, no matter “how much better” the taxes are or this or that. some things, like happiness/my sanity, are worth more than $$.
“I grew up in Michigan, I lived in Florida for a few years, got married and we landed in an Irvine rental and then bought in 1993.”
This is the typical progression of a life: Go to school & grow up, get married, rent, then get a place of one’s own and start a family.
Unfortunately, our nations leaders and lenders conspired to enrich themselves off this process instead of cultivating it. Like those birds that swoop down and devour the turtle hatchlings as they journey from their eggshells on the sandy beach to the sea.
Time to reign in the birds.
Happy 7th Birthday Sue! 🙂
You did bash Dallas if you have never lived there than how could you compare–? and the everyone who knows what is going on in RE would be us here who read the blog. I would hope we all realize what has happened to CA and many other places as well due to all the above items.
And due to our high taxes you can enjoy the full pension many here don’t have that we just pay the taxes along with yourself. You did well living in CA—a place many do not do so well.
And hopefully your home will appreciate in value and you will live a long life. Good going!!
And they turned us into obedient slaves at the same time.
Who has time to go and march on the National Mall these days and engage in disobedience before the crown’s majesty? Man, the thought of missing work for a week is horrifying to me. I don’t wannabe homeless NUH-UH; gots to keep on workin.
I am so glad you made it Sue.
Dallas sucks. You can’t compare the 2.
In Dallas you cannot carelessly frolic or hoppity skip down the masterfully designed walkways to endless wonders, nor can you experience your own personal Jesus while basking in the lord’s sun and cool breeze while plucking ripe daisies for thy fair maiden over a nicely chilled glass of cherry Kool-Aid.
It’s like comparing gold to silver, my friend. There is just simply no comparison.
Now, now, now. Every community and area has it’s positives and it’s negatives. I personally prefer an older neighborhood like Tustin to Irvine, but still enjoy both. Orange County is a bit plastic but I can deal with the fake people.
I, for one, find there is a multitude of things to do on any given day in the OC. I enjoy surfing, cycling, mountain biking, skiing etc, and all can be done within an hour drive from my house in Tustin.
Actually I can ride my bike in the Saddleback Foothills and be at the beach in an hours time. The weather is great, the traffic is not too bad compared to L.A. and crime is low. It is too expensive right now, and if I did not do or appreciate all the things that I enjoy it would make it tougher to live hear.
Personally I have no interest in living anywere else and it is worth it to me to have less home and less money and have the quality of life that I want to have.
To each his own.
Well written! Hoppity skip! Gotta’ get me a personal Jesus.
I would respond at length but I lack Mike7’s wit and rehtorical skills.
You win – my town sucks – but at a significant discount.
I’d move to Austin, and I’ve never been there.
Outside of that…Texas sucks. And I grew up near Bakersfield (which, IMO, doesn’t suck).
If you like an armpit of CA, then yes, Bakersfield doesn’t suck.
450K for a 3/2
LOL
More Kool-Aid please.
At that price, it’s tequila!
My sincere apologies if I offended you with my original comment. I fully understand that Irvine is where you live, etc. I am not opposed to living there. Dallas just happens to be where my work has taken me – after 15 moves in the last 26 years – so I’m not really a big Dallas booster. My comment was simply in regard to the relative costs of living in our two regions of the country.
…and Happy Birthday.
Buildings are not like cars. If properly maintained, they should last forever. Now, maintenance costs do go up on older buildings, but then plateau. Maybe the HOAs will be a little more than newer units, but the initial cost should much more than compensate.
As for why homes cost so much in SoCal-location, location, location, as the cliche goes. People are willing to pay more to live in certain areas, so, supply and demand means prices go up.
As for $100 a square foot for new construction (3,000 sq ft/$300k=$100 a sq ft), there are places in distant SoCal cities (San Jacinto comes to mind) where prices for three year old houses that size are now half that.
attached housing that was not built well to start with does not have an indefinite life span.
the only 100 year old attached housing that is still livable is apartment buildings in cities, so far as I know.
the only thing that appreciates is land.
and this condo does not come with land, you rent the land for the HOA fee.
A condo is an apartment building, where individual units are sold to different people. That’s it. In fact, the construction quality of a building designed to be condos is probably slightly higher on average than an apartment building built at the same time.
I stand by my statement. A building, properly designed in the first place and properly maintained over the years, will last forever. There are millions of buildings throughout the planet that are over a hundred years old.
As for why homes cost so much in SoCal-location, location, location, as the cliche goes.
Or Manias, Bubbles, and Gold Rushes…
Well, that explains the prices three years ago. I was explaining the price now. 😛
The real reason why:
http://www.crackthecode.us/images/irvinesacredtrust3.jpg
Dean, I’m relocating to Dallas. Maybe temp, maybe perm. I looked at an assortment of homes a couple of weeks ago. Nice places, big yards, excellent neighborhoods. $400-700k. Further out (e.g., Plano), it looks like there is plenty at $250-300k.
For rather similar homes here in a good part of LA, it’s currently about twice as much for “regular” homes and 3x as much for the high end ones. For Irvine you might get 3-4x as much as the Dallas suburbs. However, you can also get really cheap houses now in Riverside, CA.
My forecast is that in 2011, LA County homes will be about the same price as Dallas.
Plano is a nice area. So is South Lake and Richland Hills.
But you might also want to look at Cedar Hill, Grand Prairie and other areas south of DFW (avoid Arlington due to crime and congestion). They are very undervalued relative to their northern counterparts. The transportation infrastrusture is developing nicely, as are retail and services. Schools are mixed but are on par with most city districts.
Good luck with your move. You may regret it when we start hitting triple digits in July.
Aaah…
Triple digits temps with 90% humidity,
Mosquitoes bigger than a mexican veedub beetle,
Hail larger than a baseball,
The Dallas Cowboys,
Semi trucks driving on the fast lane,
Cowboy hats larger than a Louisiana oil rig,
Connecticut Yankee transplants with a pick up..
No man, gimme a ranch like the one is the TV Show “Dallas) and a house in Irvine.
I’ll take the occasional Big One in Socal over the periodic pests in the Mid West.
Really… this is after the Irvine Housing Blog, not the Dallas Housing Blog.
Really… this is after the Irvine Housing Blog, not the Dallas Housing Blog.
That’s right, Dallas. Bow down, kiss the ring, and worship or get the ‘HECK out.
We periodically discuss other areas. Malibu, Chicago, Dallas, Miami, etc. Irvine is what many of the posters here know best, but I’ve run into stock analysts from NY and Chicago who lurk here.
My experience is that every city has comparable areas to Irvine. Like in Chicago, it is Naperville. People often mention that Irvine is too expensive. Well, in Chicago you can get cheap houses, but it is like buying out in Antelope Valley or Riverside. Chicago has some very expensive northwest suburbs that are much like Orange County. Dallas has expensive suburbs too. You certainly do get more for your money in Texas. Irvine is nice, but I could not live there.
Gotta remember that tonyE is a Believer in Irvine. The dude calls his home a chateau. If that isn’t typical Irvine arrogance that this is the best place in the world, I don’t know what is. I’m not saying I don’t like the ‘vine, I just don’t think that every other place sucks.
Great question Dean. Perhaps you can ask Manhattanites the same question. 4X is like a drop in the bucket for them.
They are asking for 245, I might offer 200 and see if i can grab this condo =)
A commenter on my blog discovered this recent NAR gem:
https://www.youtube.com/watch?v=Z6R192JOtGs
So I guess the new tactic is: If you continue to fence-sit, you’re a bad father.
That is the most offensive real estate ads I have seen since Suzanne Researched This
The NAR has no shame, no conscious and no soul.
Oh their ad people are so clever.
The Leave-It-To-Beaver family sitting on the fence yearning for a McMansion of their own.
The inept bumbling male who will have to spend all the money and then lose it all in the divorce, stupidly and irrationally thinking he should wait while the wife and kid say “I want” “I want” “Me Me Me”.
The realtor chanting slogans
“home is an investment in your future”
“every market is different”
“Up is down, Down is up”
It just captured me and brought me right into the drama. I wanted to just yell to the guy “Don’t do it man!”
Message hasn’t changed much since 2007:
https://www.youtube.com/watch?v=AYiX2BuRVhg
At a party on Saturday a Realtor told me that house prices are starting to go up in Ventura city.
There you have it. Undeniable proof. I suppose we can all proclaim the crisis over now and call it a day.
David, I really enjoy your pictures. Thanks for that. Do you own a house or a cabin in the wilderness, or do you rent? What is your housing situation in Phx?
I always ask for proof.
I want to make an obcene comment, but my wife and your wife have met, and she seems like a nice lady.
Plus, my wife really likes you two!
Using Redfin’s numbers…she’s not THAT wrong. List prices for houses in the city of Ventura have gone up from March 23rd ($275 a sq ft average) until present ($303 sq ft average).
But sold numbers have gone down slightly over the same time period, from $257 a sq ft to $252 a sq ft.
That is, all the cheap stuff is selling (at least on a sq ft basis) and all the expensive stuff is not.
This phenomena is repeated pretty much everywhere. Pick a random city, zip code, or neighborhood, and see for your self.
Thank you. Indeed, I am more of the wilderness type. Living in Phoenix requires one to be such in order to survive.
http://www.crackthecode.us/images/AZDavidPhxHome.jpg
At least the rent is cheap.
Too funny. Next question, why do you hate Irvine so much? Perhaps you’re a former Irviner, Irvineite, Irvineagander?
I don’t hate Irvine at all.
I’m sure it’s OK place to live. I just get a kick out of some of these posts from people trying to hype themselves up into paying a king’s ransom for a place to live (or convince themselves that they are getting more for their money).
I have never lived in California; although I do presently live among quite a few California transplants.
Do you live at The Scottsdale Ocean Shores Golf, Horse and Country Club Association?
Only Presbyterian whiteys in large SUVs allowed.
Nope, although I do need to go shopping for a new pair of nice checkered pants.
Houndstooth pwns, bitches.
IR,
Do you think the changes in the mod plan today will impact the foreclosure picture and economy? Note tie in of Hope For Homeowners, which was previously voluntary for lenders and had virtually no participation.
Do the new rules require banks to offer principal write-downs under HFH? Is Congressional action needed? Is this a retroactive mandate on banks who took TARP money?
From the press release:
“Separately, the Administration has also announced steps to incorporate the Federal Housing Administration’s (FHA) Hope for Homeowners into Making Home Affordable. Hope for Homeowners requires the holder of the mortgage to accept a payoff below the current market value of the home, allowing the borrower to refinance into a new FHA-guaranteed loan. Refinancing into a new loan below the home’s market value takes a borrower from a position of being underwater to having equity in their home. By increasing a homeowner’s equity in the home, Hope for Homeowners can produce a better outcome for borrowers who qualify.
Under the changes announced today and, when evaluating borrowers for a Home Affordable Modification, servicers will be required to determine eligibility for a Hope for Homeowners refinancing. Where Hope for Homeowners proves to be viable, the servicer must offer this option to the borrower. To ensure proper alignment of incentives, servicers and lenders will receive pay-for-success payments for Hope for Homeowners refinancings similar to those offered for Home Affordable Modifications. These additional supports are designed to work in tandem and take effect with the improved and expanded program under consideration by Congress. The Administration supports legislation to strengthen Hope for Homeowners so that it can function effectively as an integral part of the Making Home Affordable Program.”
The announcement today also provides government payoffs to banks who agree to extinguish second mortgages as an alternative to rate reduction on seconds.
David
It’s a Hope For Homedebtors shell game.
Ultimately, the money that the banks exchange for the hope of the debtor will be paid for by taking hope away from the responsible tax-payer who is playing by the rules and struggling to get by.
So the next time someone puts out a crazy socialist idea like national health care – you will understand why we can’t afford it because we spend all of our money building weapons and enriching the banking oligarchy that rules us.
I agree these programs plunder responsible and productive individuals to reward gamblers who made stupid loans or borrowed money they couldn’t possibly repay. However, the result might be to stem the housing decline by rewarding irresponsible home borrowers by keeping them in their homes.
Well, he didn’t have a reason other than someone else said so. Which is pretty weak. If he were a father worth his salt, he’d be better able to explain to his daughter, well dear we could buy this house now and be underwater until you’re through with college, or we could wait, and I promise I’ll throw you a big bash of a wedding if I manage to stay employed between now and then.
For all of you renters waiting to jump in and buy an REO at 50% off or more, please be prepared to be shocked at the repair bills. This house is probably thrashed. Yeah, sure its down, too, but a house that has been partially destroyed by the evicted owner is hard as hell to sell. This house is down 200K+. I bet someone could put 50K into it and flip it for 100K more than what it is now.
I dunno, but I will soon find out. I’m in escrow in an older (originally built in 1950 with remodels and/or additions in 1959, 1964, and 1978) REO house here in Riverside, and while there were a fair number of little things wrong with it (leaking pipe under the kitchen sink, an outlet needed to be replaced, new paint and carpet), nothing big was broken. I of course don’t know the long term cost, although I’m sure there are big things like replacing the roof every decade or two that I will have to budget for.
Now, as for a condo, direct out of pocket maintenance costs are less than a house, since exterior things like new roofs should be paid for by the HOA fees. So it’s just stuff like plumbing leaks and repairing broken appliances, which, on an annual basis, have fairly minimal costs (maybe a grand a year at most on average).
For those of you who question why Irvine is so expensive, you have not seen the outrageous pricing in Cupertino, CA. For $1 million, you get a run down Brady type SFH that’s located in a great school district based on their API scores. At least Irvine doesn’t have this insanity (yet).
That, my fellow blog readers, is the main reason why it’s so damn expensive in **some** California cities.
Those prices were here last year for Irvine. But you are right some places in the Bay area are insane as well–Alamo as well.
There was a time you could not find anything under 2 million in Newport nor under a million for SFH in Irvine.
Many are cracking under.
And for those who do not know this is the result of the Icing on the Cake –“The Crown Jewel of Irvine”
http://www.ocregister.com/sports/resort-irvine-pelican-1912583-hill-character
I just can’t wait to go—can we all get in??
Malibu prices back to early 2000 levels, http://www.dqnews.com/Charts/Monthly-Charts/CA-City-Charts/ZIPCAR.aspx
The median was last this low in 1999/2000. Insert usual disclaimers about medians here, but it’s off 47% in a year, and 2008 was already down a lot from 2006.
He had heard of that mystical magical place called Irvine.
A shiny clean place that had sprung from the wastelands off the uncharted stretch off I-5 towards San Diego.
He just had to see it for himself.
After bathing twice, brushing his teeth and flossing, now modestly convinced that he was clean enough to be allowed to enter the Heavenly Kingdom of Irvine, he screeched out of the parking garage of his Hollywood apartment in his 14 year old bitter-renter mobile heading for the promised land.
He had heard all the stories…That the Mormons originally intended to settle Irvine, and that it was the third choice contender for the Nation of Israel just behind Miami and Palestine. However… God had not reserved Irvine for the Chosen Ones, but rather for the Priveleged ones.
After an hour long teeth chattering ride along the horrifically fractured stretches of pavement that the County of Los Angeles refers to as “Free-ways”, the weary soul knew immediately when he was in Irvine. The roads were as smooth as merangue, with the asphalt combed as perfectly straight as an Irvine-womans hair.
After pulling off the highway into the vast sea of terra cotta blandness, he knew he had arrived. The streets were empty as all of the male citizens were just finishing up their after lunch hair-gelling. Our traveller was unaware that there were only 2 HOA approved hairstyles but thankfully there were complimentary caps.
He had a quick lunch (everything in Irvine is made in labs elsewhere and shipped in) of Chinese Chicken Salad at some restaurant that looked like every other restaurant. There was something strange about the chicken however…until he realized that it was a vegetarian restaurant. It may have tasted like chicken, but he was still skeptical. S#it may taste like chicken…he thought. It still doesn’t make it OK to eat.
After lunch, our traveller stood back and marvelled at the neatly ironed (no starch) wonder that is Irvine.
Irvine looked back and reminded him that he had forgotten to tuck in his shirt.
He had to be on his way before the mandatory daily citywide cleanup hour, where all the citizens sweep, scrub, polish and vacuum their beloved city, ridding it of any and all traces of outsiders but that was ok as he never expected to understand all the ins and outs of Scientology.
As he drove off, knowing that he would never be good enough for Irvine, he at least was able to console himself on the fact that it was still legal to go more than two days without shaving in Los Angeles.
;^)
Great post. I am glad you made the journey to the Promised Land to see it for yourself. I hope you enjoyed your trip.
Was that based on something else, or original? Either way, lots of LOLlage. 😆
Just shot from the hip on that one. Sometimes you get lucky.
I guess Irvine was a pretty inspirational place for me. :^)