In a competitive society like ours, there are winners and losers. The people who bought before the bubble, did not HELOC their home, and are selling in time to cash in that bubble equity are the winners. Let’s celebrate them today.
Asking Price: $747,500
Address: 14811 Mayten Ave, Irvine, CA 92606
BTW, I am guest contributing to the Irvine Homes blog this week. Today’s post is a community profile on Woodbridge.
We Are The Champions — Queen
I’ve taken my bows
And my curtain calls –
You brought me fame and fortune and everything that goes with it
I thank you all –
There was a time, many years ago when success came through vision,
hard work and sacrifice. Achieving success was a slow process, and
there were no guarantees. It doesn’t work that way in California any
more.
Now, success comes through passive ownership of real
estate. It requires no vision, no work, and no sacrifice. In fact,
people are allowed to immediately enjoy the fruits of their lack of
labor through mortgage equity withdrawal. They do not need to slowly
accumulate wealth when they can quickly live off the converted income
from their brilliant asset purchase. The old measure of success was
asset accumulation, whereas the new measure of success is resource
consumption. It is important to drive the right car, carry the right
handbag, eat in the right restaurants, and of course, live in the right
neighborhood. People should be surrounded by the other people who are as brilliant and successful as they are.
The real champions of conspicuous consumption and pretentious consumerism are suffering right now. Many have already lost their homes, and the rest will soon enough. This recession we are all enduring was caused by the banks lending people insane amounts of money and losing it. They lost this money to the pretenders I profile with HELOC abuse stories almost daily. It is hard to feel too sorry for the pretenders; after all, they would be the first to tell you how they are entitled to their lifestyles, and they are superior to you because of it.
Today’s featured property is different; the owners represent success
from a bygone era. They allowed their equity to accumulate, they paid
down their mortgage, and now they have an opportunity to cash out and
enjoy a well-funded retirement. These owners are among the champions of Irvine. When a knife catcher comes along and cashes them out, they will pocket about $700,000. They are winners.
Our bubble economy and culture favors speculators and gamblers. There was a time when you could invest in reliable cashflow investments at reasonable prices and make relatively secure investment returns. A bad investment might not earn you the return you hoped, but they didn’t have the potential to cause catastrophic losses like we are witnessing during the housing bubble. Once the Wall Street market mavens realized they could fleece the unsuspecting masses through asset price volatility, the days of cashflow investing were over.
Despite this change in investor psychology, there are still people who lived by the rules of yesterday. Saving money and living frugally went out of style years ago, but those who clung to their old values still have cash and equity. If they move quickly they still have time to make a few extra bucks off the adherents to the speculative mindset being summarily crushed in our post-Ponzi Scheme world.
So please, any knife catchers out there, go buy this property and let your mistake make their success complete. They deserve it.
Asking Price: $747,500
Income Requirement: $186,875
Downpayment Needed: $149,500
Monthly Equity Burn: $6,229
Purchase Price: $45,000
Purchase Date: 12/19/1973
Address: 14811 Mayten Ave, Irvine, CA 92606
| Beds: | 5 |
| Baths: | 4 |
| Sq. Ft.: | 2,318 |
| $/Sq. Ft.: | $322 |
| Lot Size: | 5,000
Sq. Ft. |
| Property Type: | Single Family Residence |
| Style: | Contemporary |
| Stories: | 2 |
| Year Built: | 1973 |
| Community: | Walnut |
| County: | Orange |
| MLS#: | S572958 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 7 days |
Ownership here! Home totally remodeled throughout – Tile Floors, Crown
Moulding, Recessed Lighting, Custom Staircase, Granite Counters and
Backsplash in Kitchen and all Bathrooms. Kitchen has also been
expanded, with custom cabinets, under-cabinet lighting and Stainless
Steel Appliances including Bosch Dishwasher and Bosch Stove. Two Master
Suites (one with a Jacuzzi Tub). All bathrooms have been remodeled, one
with Safety Handrails, one with Closet. Ceiling Fans and Plantation
Shutters in most Rooms. Dining Room with additional window, and bead
board trim. Incredible Outdoor Living Center in Backyard, with Fruit
Trees, and Beautiful Gated Front Porch Area both with extensive
brickwork. Wrought Iron Balcony Railings. Expanded Driveway. You must
see to appreciate all that this Home has to offer. Come see for
yourself!!
WOW! LOCATION! LOCATION! LOCATION! These sellers deserve better than this kind of meaningless realtorspeak.
This property was purchased for $45,000 on 12/19/1973. The owners long ago paid off their mortgage. On 3/9/2006 they did take out a $45,000 mortgage, but it is obvious from the photos that the property was completely updated. I imagine that every penny of this money went into the update. If this property sells for its current asking price, and if a 6% commission is paid, the total profit on the sale will be $657,650. I hope they get it.
I see so few properties for sale where the owners were responsible with their debts. There are probably many more out there, but since they are not in distress and have no desire to sell, I don’t see them; however, if it is for sale today, even the organic sellers have generally doubled their mortgages and they are in distress.
To today’s featured property owners: I salute you.
{book1}
I’ve paid my dues –
Time after time –
I’ve done my sentence
But committed no crime –
And bad mistakes
I’ve made a few
I’ve had my share of sand kicked in my face –
But I’ve come through
We are the champions – my friends
And we’ll keep on fighting – till the end –
We are the champions –
We are the champions
No time for losers
‘Cause we are the champions – of the world –
I’ve taken my bows
And my curtain calls –
You brought me fame and fortuen and everything that goes with it
I thank you all –
We Are The Champions — Queen
Wow–$901 a year in property taxes…thank you prop 13.
In addition to their responsible use of credit/debt, these owners also took care of their property (and made substantial improvements), which seems quite rare in Irvine. The older homes, in almost every other case I’ve seen, have been either (a) updated by short-term owners, or (b) ignored and worn out by a succession of owners.
Per CNBC this morning:
California Treasurer Says States Need TARP Money
The California state treasurer called Wednesday on U.S. Treasury Secretary Timothy Geithner to extend debt guarantees through the Troubled Asset Relief Program to financially strapped states and local governments facing declining revenues.
In a letter to Geithner, Bill Lockyer said essential public services could suffer “devastating impacts” unless states and local governments are able to borrow short-term funds as they normally do amid recession.
Without short-term borrowing, California, the most populous U.S. state, could face difficulty in selling its long-term debt, Lockyer added.
Lockyer proposed in his letter that the U.S. Treasury create a TARP program to induce banks to make credit available for short-term borrowing by municipal issuers.
———————————-
FYI ~ Also, the governor is considering placing several of California’s landmarks on the auction block, including the OC Fairgrounds & San Quintin.
I was at an affordable housing conference on Tuesday. The California State Controller, John Chaing, was the guest speaker. He outlined how bad everything really is in California. The state has not been cashflow positive since July of 2007. It has borrowed from every source it can, and our credit rating is the worst of any state in the Union. He said the budget shortfalls this year were surprising; everyone thought next year was going to be the real problem. The fact that this year is so bad foretells a disaster in the making.
The battle between the Democrats who want to spend, and the Republicans who refuse to raise taxes created the impasse back in February. We almost went broke. It will be interesting to see which side capitulates in this battle and what the fallout will be.
A lot depends on the election come May 19th. If those propositions fail, expect California to soon look like a third world nation due to inability to pay for schools, police, fire, and road repairs.
What kind of propaganda is this?
If the props fail and California goes bankrupt, services such as schools, fire, police, all get first dibs on any money coming in. These services will not end up like a third world nation, however the union contracts will be torn to shreds.
Please stop with your lies. California will have a hard time but in the end we may actually have measures to control state spending. I hope all the measures do fail.
Of course schools and public safety will get first dibs-they already do, within the confines of the California constitution, which, due to various propositions that have been passed in the past, require certain monies to be spent on other programs (Props 1D and 1E overturn some of those requirements and provide more flexibility).
California won’t go bankrupt per se. It’s more likely that large numbers of teachers, fire fighters, and police officers throughout the state will be laid off. If the propositions don’t pass, one of the key reasons to move to Irvine (good schools) will evaporate.
And when you complain about union contracts, you are basically saying fire fighters, police officers, and teachers are paid too much. Do you really believe that?
“And when you complain about union contracts, you are basically saying fire fighters, police officers, and teachers are paid too much. Do you really believe that?”
Yes, except for the teachers; it is the administrators that are overpaid.
Really? You know what I mean when I say union contracts. So only fire fighters, police officers and teachers have union contracts in the state?
I must be ignorant of the following:
American Federation of Government Employees
American Federation of State, County and Municipal Employees
American Federation of School Administrators
Amalgamated Transit Union
American Train Dispatchers Association
Brotherhood of Railroad Signalmen
California School Employees Association
California Nurses Association/National Nurses Organizing Committee
International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers
International Brotherhood of Electrical Workers
International Federation of Professional and Technical Engineers
International Longshore and Warehouse Union
California Correctional Peace Officers Association
This is just a very minor amount of unions which directly or indirectly have contractual work with the state.
I must have also been ignoring the fact that when private company runs out of money they lay off employees yet our State has made a deal with one of the largest unions, Service Employees International Union, that they are immune from lay offs. (http://www.seiu.org/2009/03/half-of-californias-state-workforce-covered-by-new-contract-agreement.php)
On top of all this you still continue with your propaganda that if we do not get this money the state will collapse as fire, police, and teachers all disappear. You know perfectly well this is not true. Please stop your lies and fear mongering, the solution is not rhetoric but proper spending and legislation.
Your last paragraph is just dishonest, no such assertion was ever made about pay for teachers, police or firefighters.
Are you really trying to argue state spending has not gotten out of control?
http://www.usgovernmentspending.com/usgs_line.php?title=Total Spending&year=1992_2010&sname=CA&units=b&stack=1&size=m&col=c&spending0=160.24_166.28_171.75_179.55_185.24_193.99_202.34_215.68_234.12_262.28_290.45_307.53_324.61_341.08_361.38_382.88_405.66_429.80_455.37&legend;=
Relax guys, we are not supposed to be a political blog.
roger that. as with anything, there are exceptions to the rule. it is disheartening to see some teachers who are just coasting toward retirement who don’t have an ounce of heart left in them to remember why they got into teaching in the first place. they all get paid the same.
some admins are complete jokes, with little comprehension of economics or management. back in grade school, i used to place administrators and teachers on pedestals, the great purveyors of knowledge and wisdom. now with my own degrees, and work experience, it seems like a big joke.
yes, not a political blog, but the frustration that comes with the current real estate market is interconnected. personally i appreciate jwinston2’s observation. hdt wrote “there are a thousand hacking at the branches of evil to one who is striking at the root.” it’s pretty easy to lose focus these days.
and to clarify about my prior comment about teachers getting paid the same- i meant the pay scales are set by years of experience, credentials, etc. of course these can vary across districts.
IR, thanks for the great work. been reading your work and those that comment off and on for over a year and a half.
Maybe we’ll stop funding illegal aliens and tell Obama, Pelosi and the feds to go stuff it.
Sorry IR,
I will tone down the politics; I just get frustrated with all the agendas being pushed lately on theme specific forums and blogs from individuals who clearly have a vested interest in a particular viewpoint.
No problem, I understand and share your frustration.
“Maybe we’ll stop funding illegal aliens and tell Obama, Pelosi and the feds to go stuff it.”
Ummm….I don’t think California can tell Obama and Pelosi to stuff it when the Treasurer is asking for a bailout from them 🙂
Yes, I do. Very much so.
http://www.examiner.com/x-9382-Marin-Republican-Examiner~y2009m5d12-CalPERS-14-retired-Marin-public-employees-receive-annual-pensions-of-100k-or-more–for-life-
I don’t even think this is a battle between Democrats and Republicans anymore.
One ideology controls the entire state, and California is a perfect example of what happens when politicians with an axe to grind, become too powerful.
Per the Wash Post ~
In February, California’s Democratic-controlled Legislature, faced with a $42 billion budget deficit, trimmed $74 million (1.4 percent) from one of the state’s fastest-growing programs, which provides care for low-income and incapacitated elderly people and which cost the state $5.42 billion last year. The Los Angeles Times reports that “loose oversight and bureaucratic inertia have allowed fraud to fester.”
Yes, California’s senior citizens (many of them veterans) get thrown under the bus so’s we can continue to provide services for illegal aliens which dwarf anything their own governments would or could ever provide them.
But to even attempt to discuss our i.a. problem is to be branded a racist.
I hate Californians and i am one
Have you seen this one?
525 Luminous
Irvine, CA 92603
Yeah, have toured that one. It is nice inside. Expensive though.
Speaking of California, here is an interesting take:
http://globaleconomicanalysis.blogspot.com/2009/05/california-is-complete-basket-case.html
“The city council is required to have a balanced budget by July 1. Good luck with that. My plan for LA is simple: declare bankruptcy just like Vallejo did and hope the unions get what they deserve in court, nothing.”
Since the CA budget has come up, I thought that some of you might be interested in taking the California Budget Challenge. Here is how it is described on its webstie: “The California Budget Challenge is a nonpartisan online game that lets you decide how much to spend on schools, prisons, the environment and other state programs – and how to pay for them.” (http://www.nextten.org/next10/programs/budget_challenge.html) It might take a while to load, so be patient.
This is a beautiful house, I love what they did with that $45,000. Impressive really, they even have my biggest kitchen want: a real exhaust hood over the stove. And the black bathroom fixtures in the light bathroom, very nice choice.
How well priced is this for the neighborhood and comps? Will it get bid up? Or is it “just right”? From the “nearby similar listings” which don’t look similar at all, it may be just a tad overpriced, but since I love their upgrade choices so much, they may be okay.
John’s post is the cause of Lee’s post. Prop 13 is a very large reason why the California budget has been screwed up for thirty years.
Very true, and Prop 13 is grossly unfair. Our house (purchased in 1991)is assessed at just over $230,000. Our next door neighbor pays THREE TIMES the property tax we pay. Not very fair that two families that live in almost identical houses right next door to each other pay vastly different property taxes for the exact same services (I’m not complaining, just being honest).
It’s possible to repeal large parts of prop 13, increasing tax revenue, but without having the whole “grandma on social security has to move out of the house she bought 40 years ago because taxes are too high”. My suggestions to modify it are:
1. Repeal it on all commercial and industrial property, as well as non owner-occupied property (IE, rental property).
2. Repeal it on people who make more than $100k a year ($200k for couples), with a phase-out (that is, allow tax assessments to rise 3% a year on people making up to $120k, 4% on $140k, 5% on $160k, and full assessment above $160k).
This doesn’t remove all the unfairness, but it balances things out a lot without causing the whole grandma-is-forced-out-of-her-house thing.
If you tried to repeal this on non-owner occupied housing, you would soon discover that the Howard Jarvis taxpayer association is basically a front for the apartment owners.
Of course. This is not going to happen. California’s budget has been fucked for thirty years, and prop 13 is the cause. It’s not fixable, because apparently teachers and cops make too much money, so nobody will vote for tax increases.
How is Prop 13 ‘unfair?’ It rewards people who prudently live within their means and punishes people who are daily the subject of the posts here at Irvine Renter.
Instead of monkeying with the revenue side, I have a better idea — why not cut out all of the superfulous bull$hit programs? The state and local governments got caught up in the some orgy of excess as all of the HELOC abusers. Now, the must trim back and live within their means like everyone else.
Why does anyone equate income to wealth. There is a big difference between the guy or gal who finally breaks through and makes $100k in their first year and the person who’s been making $100k+ for 20+ years. Income based taxing does nothing to distinguish between the two. Income taxation is robbery by the state on behalf of those too chicken to do it themselves.
Name a superfulous bull$hit program, please. Schools? Police? Fire protection? Road construction? Community colleges? The Cal State or UC university systems?
There was a recent poll done by The Field Poll. They asked Californians if we should raise taxes or cut spending. Most people wanted to cut spending. But then they listed twelve specific programs, and out of the twelve, a majority didn’t want to cut ten of them.
Everybody wants to cut “overnment waste” in the abstract. Nobody actually wants to cut anything specifically, however.
EASY
Tuition discounts to illegal aliens.
Social services including cash aid ” ”
Free medical care ” ”
11% of our prison population ” ”
Bilingual ed and unparalleled ed services to ” ”
You guys are trippin’
The problem is not revenues because of prop 13.
The problem is expenditures. See how California compares THERE to any other state-
Just another plan to soak the productive people who built our once-great state for the benefit of whatever you call people who live with their hands out-
County Fair Board.Consolidate water boards.Great pork(Park)project.Jesus,we blow stacks of money in this state on crap.
Financial support for illegal aliens.
QED.
It’s defined as any service the homeowners were using back in the 70s, but no longer need anymore now that they are older – no body younger than them needs them they figure.
Like, say schools or unemployment, ’cause the homeowners who bought in the 70s are now retired.
So if we rounded up all the illegal immigrants, the budget would be balanced?
Nope-not even close.
Plus, a lot of that is required by Federal law, not to mention common decency. If somebody wheels up to the ER, you treat them, you don’t ask for their green card. Since we are going to treat them anyways if they go to the ER, it’s cheaper to also give them preventative care before whatever problem they have becomes chronic. Withholding medical care until they need to go to the ER would cost the state MORE money, not less. Plus, it would be harder to control the spread of communitive diseases.
Also, there are other problems. If it was possible to round up all the illegal aliens and deport them, you would have hundreds of thousands of children, millions possibly, dumped into foster care-that is, those born in the US of foreign citizens. They are citizens of the US (this can not be changed without a constitutional amendment) and not the country their parents are from, so they can’t be deported with their parents.
Yeah, prop 13 is why I will never live in CA. It’s grossly unfair to have two neighbors in similar houses pay very different amounts in property taxes simply because one bought their house earlier than the other. It certainly doesn’t work that way in TX.
Also, I don’t understand how when a house is reappraised for a HELOC or new mortgage why that new appraisal value doesn’t seem to make it to the tax rolls? Or rather, I do understand but don’t like it one bit.
If they were to trigger new taxable values based on HELOC spending, it would be one of the best things California could possibly do. I may need to write a post on that idea.
It’s a good idea but the county probably couldn’t afford to hire enough appraisers to do all the helocs.
I doubt they would make such retroactive, and there isn’t going to be much new HELOC abuse for awhile, so, as a practical matter, the point is moot.
In any case, ANY modification to prop 13, or, apparently, any attempt to raise any taxes, is unpopular and will fail. The elimination of things like in-state tuition for illegal immigrants are such a small portion of the budget that that’s not a solution either.
It appears what will happen is that there will be massive cuts to things like police, road construction, and schools (both K-12 and higher education). It’s easier, under the California constitution, to lay off teachers than to raise taxes to pay for their salaries. So, that’s what will happen.
IR, I was just thinking the same thing the other day. After all, every one of the refi events you chronicle turns out to have been a sale to the bank (and, now, to federal taxpayers).
Other reasonable prop 13 reforms:
-exclude commercial real estate
-remove the inheritance exemption
Hey, that’s the California way. Take care of myself, no matter what, and screw the next guy. In the case of Prop 13, it was the voters at the time who said, we’re taking care of ourselves, screw everyone who comes after us.
A little tinkering would increase the fairness of Prop 13.
One of the real problems is that the 2% per year increase in the value of the property was less than inflation. If that were bumped up to a 3.3% increase for properties that had not changed hands in the last ten years, or the market value of the house, compounding would gradually help us achieve greater equity, and it might actually be politically feasible.
It’s also absurd that businesses can escape the re-evaluation at time of sale by selling the stock that owns the property instead of selling the property.
Frankly, I think that a billionaire like Donald Bren should pay the same percentage of the value of his properties as a struggling condo owner in Aliso Viejo.
Prop 13 has actually had some very positive effects, including stablizing the third ring suburbs, where owners had tremendous incentives to stay put.
Yes, I do not understand why it isn’t at least indexed to the CPI. If they did that, the increase would be a closer match to underlying fundamental valuations and revenues would increase with inflation. Since the original argument was that seniors were getting taxed out of their homes, this argument goes away because seniors are receiving cost of living adjustments based on the CPI as well.
just found this older article on the subject
http://cbs13.com/local/proposition.thirteen.budget.2.762331.html
good info on subject
Florida’s “save our homes” amendment, similar to prop 13 but only for residents and only in primary residences, does index to CPI or 3% annually, whichever is less. So the CPI choice might not work, depending on the wording.
It might also eventually do away with Mello-Roos. These appeared just a few years after prop 13 took effect because the local communiities no longer had the tax funds for infrastructure maintenance.
I believe one of the reasons for Prop. 13 was to guard against the rapid appreciation of real estate and the consequential property tax increase. Probably a valid concern for a rapidly growing state.
Certainly, a way to minimize property value fluctuations is to mandate sensible lending standards.
The market place naturally will do this. The government just needs to stop interferring with the market place by way of tax benefits and the present bailing out of banks. Unfortunately, the REIC is very powerful and will continue to bribe the government to interfere with the market.
Am I really reading long string of comments advocating tax increases for ‘everyone else’ so you can feel a sense of “fairness”.
Prop 13 was put in place because the state couldn’t help raising taxes every time you turned around.
The arguement should be that new homeowners’ taxes should be lowered to the old homeowner rates… that is the only change to Prop 13 I could get behind.
No matter how you do it, property tax can not be ‘fair’ because you are paying an arbitrary amount on something you ‘own’ and haven’t realized any gains on. If the arguement is that it is for local services, then you need to tax everyone and not just property owners.
“If the arguement is that it is for local services, then you need to tax everyone and not just property owners.”
Hold on, since I rent, my rent goes to some property owner. And that owner has property taxes. In fact, no matter where I live, I have to either rent, or buy and eventually that contributes to the local property taxes. Heck, even if I choose to live at home, my parents would be paying the local property taxes.
“…since I rent, my rent goes to some property owner. And that owner has property taxes”
What happens to a vacant unit? The owner pays twice as much tax… for what?
And living at home, that just means you are free-loading local services and not paying your “fair share” (I love stealing Obama lines)…
It is an unequitable system, I think the only reason it still exists is because most people don’t own so it is “someone elses problem”.
This nice average home might get near $700k if the owner is aggressive in hitting any reasonable bid. If not, it will fade another $200k in 2011 at about $500k.
I agree it’s still over priced but I don’t know all the improvments (termites, roof, ect.) It’s still a really big profit if they get it.
What I have a problem with is future profit if you buy this house where do you see your profit?
California has made it impossible to buy a new house put in your own improvements live in it and after future years gain on your investment.
They have taken this away from the homeowner because by setting new homes prices so high, taxing you with mello roos. In effect takes out your future profit.
Homes priced to perfection leaves no room for the homeowner for future gains.
I thought the purpose of a house was to protect you from weather and animals. I did not know the purpose of a house was to make a profit.
Back up offers accepted.
There is so little inventory that is truly available right now that anything that can close that is priced near comps is selling. Much of the inventory is short sales which either do not sell, or they take forever, and a significant amount is still organic sellers with WTF pricing. I am not surprised that this is already in escrow.
I have buyers ready but there is very little to buy. In the neighborhood that they want to buy in, houses in the low WTF price levels are gone in less than a month. Even all the short sales are gone.
Hopefully in 6 months the REOs will start hitting and we can get some reasonably priced inventory.
That’s right Walter. So what should all of us wanting to buy a house at fundamental value do:
1. Hurry or you’ll be priced out forever!
2. Bid up to see who becomes the biggest bag holder.
3. Hurry and buy before all those small inventories are gone.
4. Real estates will bottom in Irvine in june and will appreciate 100%/year.
Typical Realtard hustling… no different from used car salesman
Not sure what you are getting at? If you are implying that I am a Realtard hustling, mind you I am telling my clients to wait until the REOs I see in the pipeline hit.
This is made difficult for me because of the other agents telling them how great a time it is to buy. At least some of them remember, or know people that remember, me telling people how risky it would be to buy in 2005. I do real estate on the side and do not live on the commissions, hence I can say these types of things.
As for what I said, I am just stating facts. The same as said by IR. There is little available inventory out there in desirable areas right now.
I’m looking for a house in Westpark 2. What’s available is all WTF priced. So I’m waiting it out.
Not sure why you feel the need to insult someone who is stating facts. Not all realtors speak BS or try to hustle their clients. I also have clients who are trying to move up to a larger home in Irvine and there simply isn’t enough inventory right now. My advice to them is to try to sell now given the low inventory and hold onto their cash until prices decline further and inventory increases.
I agree with your advice, but many will not want to move twice making this a difficult situation.
Supposedly Sam Clemens said “two moves equals one fire.” Given the number of storage lockers for rent, lots of us could use a small fire!
Pack up the crap you can’t bear to throw out but don’t really need often in one set of boxes and a minimal working set of stuff in another. I’m not a fan of rental storage, so if there’s no garage to store them in, I’d stack them behind the couch and across the bottom of the closets.
I used to move from one apartment to another without ever unpacking 1/3 of my boxes. Being a slob, I didn’t even bother to hide them behind the couch. What didn’t fit in the closet formed towers in the corners. I was too much of a pack-rat to throw them away the second time I had to move them unopened…but my spousal critter eventually wore me down.
Short the market!
If only I could borrow someone’s house to sell now. Anyone want to lend their house to me? I’ll buy you a better one in a year;
Would the lack of inventory or homes going into escrow like this one be linked more to low interest rates or a growing enconomy and incomes? Seems to me that the former is most likely and thus as a predictor of price movement, the interest rates are bound to go higher which will adversily effect the price of homes like this one dramatically. Would you still be stuck with the taxes paid on the 700K+ price? I think you should be, there should be no re-apprisals.
The low inventory is largely due to the withholding of REO by the banks. Right now, the organic sellers are not selling because prices are “depressed,” and those organic sellers who are trying are asking peak prices. The short sales take forever, and often they do not transact, and the REO is being held off the market. It creates a situation of low available inventory and a growing shadow inventory.
Hmm… maybe I should sell my house.
2700 sq feet, 5b/3ba, 1600 feet of Cat5e, 500 feet of RG6, structured wiring for network, phone, cable and even AC power for computers, stereo, etc… Delta wiring with “dark” cables for future growth. Currently running GigE.
Two closets: access closet and data server closet. Dedicated AC power. Additional data switching in rear attic with dedicated AC power and drop down access door.
Bring your own Spanning Tree switches with link aggregation and run 4GigE all over the house!!!
Location! location!! Yes, Cox Cable and DSL available too!!!!
Oh yeah, we got a Viking range top too.
😉
Good for these people, I am happy for them. My parents generation (which I assume the sellers of this property are) did an excellent job of being frugal and living within their means. Many of these people lived during WWII (either here or abroad) and that had a huge affect on how they view the world when it comes to finances.
I see the property is already in escrow…good job people. Enjoy your retirement!
The State of California, like GM and the bad banks, should NOT be rescued. It should be forced through bankruptcy to clear the decks of the suffocating union contracts, patronage jobs and systemic waste. The model failed, it should not be kept on life support.
If all of the meaningless patronage jobs paying $200k per yer fully loaded were eliminated the state would return to solvency.
I am also often stunned when talking to me seemingly well-off neighbors to find out how many of them are receving s state handout of one sort or another. They carry their state cheque to the bank in their Prada handbags.
Many people with cash based business drive BMWs and collect welfare. I am not making it up, I see it first hand.
Isn’t that story old (and 99.9% fictional)? Like Ronald Reagan old, except then it was Cadillacs.
Usually, when the state cracks down hard on welfare fraud, the cost of the crackdown is greater than the savings from finding what little fraud is there.
How much is of this type of fraud is there? I have no idea. But I can tell you that in the independently owned food service industry (donut shops, Chinese fast food, etc.) it is wide spread. Basically a small set of the family and extended family is setup with ownership of the entity and the rest of the family is allowed to apply for assistance. The cash money is then passed around as payment for working at the business.
“If all of the meaningless patronage jobs paying $200k per yer fully loaded were eliminated the state would return to solvency.”
http://www.lao.ca.gov/analysis_2008/general_govt/gen_anl08022.aspx
“The costs for compensating 350,000 state government, California State University, and University of California employees under existing pay and benefit schedules are included in each department’s budget. The Governor’s budget assumes these employees’ salaries total $23 billion (all funds) in 2008–09. Including employer benefit expenses (principally retirement and health benefit contributions) and payroll taxes, the total costs of compensating these employees are about $30 billion”
The budget gap is $42 billion. So if every California state employees works for free, without benefit, the problem still can not be fixed.
I would call $23BN a pretty darn good start towards solvency.
Then we could target some of the ridiculous hand-out programs to get the rest of the way there.
When an entity goes bankrupt it most get smaller, not borrow more.
Hem. Move the goalposts all you want, but scapegoating the state employees is not the solution.
http://www.latimes.com/news/opinion/la-oe-matsusaka17-2008jul17,0,7957570.story
Spending increased 40% in four years, from 2004-2008. Adjusted for population growth and inflation it increased 20%. California public school enrollment has stayed relatively the same during these 4 years (http://www.dof.ca.gov/Research/demographic/reports/projections/k-12/index.php).
To keep this related to real estate the only reason why we have not had a collapse much sooner is because state revenue grew over 30% in those four years, mainly due to the real estate bubble.
One last note I have found an interesting discrepancy between your LAO report and just one California union website: http://www.seiuca.org/Industries/Default.aspx
The SEIU claims they have over 350,000 California public union members. This would contradict the LAO report since they claim only 350,000 employees total and we know that SEIU doesn’t include teachers, firefighter, police, highway patrol, engineer, prison guards, etc.
According to your link the SEIU number is for ” Public Services (State & Local).” Since the LAO number is clearly for State/UC/CSU employees only, I don’t see discrepancy issue. A lot of those are cities and counties employees.
As for the number between 2004-2008, how is that the state workers fault? Unless you can trace those increase due to $200,000 patronage jobs, or people whose pay increased into those category, how does that contradict my point?
That is a good point about the SEIU website including state and local employees. However many county and local salaries are partially paid by the state so your numbers are being intellectually dishonest. If you look at only state employed salaries you are missing a big portion of the pot that is our budget. For example county and local employees pull part of their salaries and benefits based upon state payments to county and local municipalities.
Regarding the 2004-2008 numbers, the major cost for any entity is employee salaries and benefits so of course increased salaries and benefits for state, county and local employees is one of the major reasons for increased spending.
Wow! Why stop there? City and county employees’ salary are being partly paid by state government expenditure, what a shock? How many private sector employees also can trace part of their pay to state expenditures? Should they also be included to be intellectually honest? Even if you or your employers is not getting state money, are you sure none of your customers/clients are paying you with state money? Where do you drawing the line? 50% state fund? 10%? 1%?
I still stand behind my original response.
“If all of the meaningless patronage jobs paying $200k per yer fully loaded were eliminated the state would return to solvency.” was misinformed and ignorant.
The way California is going there will be a run on razor wire and security shotguns.
You might be interested in Florida’s – in effect since 1992 – answer to California’s prop 13. It’s called the “Save our Homes” amendment and not nearly as generous as prop 13. It applies only to homesteaded properties (i.e., primary owner/resident of the state), not to second homes (even if they are owned by a primary resident of Fla) and not to anyone who is a primary resident whose spouse claims a homestead exemption on his/her primary residence in another state. It’s limited to 3% annual increase or CPI, whichever is less. And Fla is looking at a 9% vs Cal 13.5% current budget shortfall. Everybody has problems – and attempts to provide fairness where property taxes are unequally applied are not working.
“Once the Wall Street market mavens realized they could fleece the unsuspecting masses through asset price volatility, the days of cashflow investing were over.”
Not only that, the mantra of the past 20 years was to diversify and invest long term. Can you imagine being a 60 year old, nearing retirement, and your 401K just got squashed?
Meanwhile, your government-employed next door neighbor is whistling dixie. Stock market up? So what! Stock market down a lot? No worries! He’s collecting a pension based on his salary when he retires!
“How you doing?”
Did anyone see the NYT article on Calculated Risk today. Great story.
http://www.nytimes.com/2009/05/17/magazine/17foreclosure-t.html
The owners lost big time on this house. They should have sold three years ago, and pocketed $300K more.