This weekend's featured property is an REO where the lender failed to drop their opening bid and grossly overpaid for the property.
Irvine Home Address … 88 STEPPING STONE Irvine, CA 92603
Resale Home Price …… $519,800
{book1}
Mirror, mirror on the wall
The face you've shown me scares me so
I thought that I could call your bluff
But now the lines are clear enough
Life's not pretty even though
I've tried so hard to make it so
Mornings are such cold distress
How did I ever get into this mess
Snowblind — Styx
How did we get into this mess? Lenders must be wondering how they can issue first mortgages at 80% value and find themselves foreclosing and losing money.
This weekend's featured property was sold at Trustee Sale recently. The lender did not drop their bid, and they bought this property for well over its resale value. At first this may look strange, but the lender is likely acting as a servicer executing instructions contained in documents drafted during the bubble when nobody anticipated these problems. As a result, the lender is flipping for a $92,000 loss.
IHB News
Shevy has been busy with clients, and he received the following email earlier this week:
Shevy,
Thank you for setting up the viewing of the homes we were interested in. While they were okay houses they were not the houses for us. So, we'll keep looking and we'll keep looking at all the emails you've been sending to us, which have been really helpful. I also wanted to thank you for keep in constant contact with us and for the quick responses to our emails and our phone calls. I can't tell you how it makes such a difference when your customers feel like they are important to you, which we do and we appreciate that. Also, we'd like to thank Rana for taking the time out of her schedule to show us the houses and also for her laid back approach, no pressure, just letting us make up our own minds. I'm sure we'll be in constant contact about more houses in the future.
Sincerely,
[IHB Client]
We recently updated our WYSIWYG editor, so now I can change fonts, change colors, highlight text, subscript, superscript, block quotes, and other fun stuff. I will explore these new tools over the next several weeks.
As I mentioned a few weeks ago, I take a writing class from Irvine Valley College. I laugh to myself whenever I find a simple, embarrassing error I make frequently. This week, I discovered the word "attorney" is made plural by adding an "s" to form "attorneys." I have spelled it "attornies" on many occasions. I know many attorneys read this blog, and I imagine a few have chuckled at my error; I would.
Lately, I hunger for words. As a writer, words are my only commodity, and having more of them and using them with greater precision is a high priority. The weary UPS guy carries numerous 800+ page books I order from Amazon.com or Half.com. I get dictionaries and thesauri (I had to look up that plural), and various versions of each to explore what they offer.
There are hundreds of thousands of words in English, and many great minds have looked at different ways of organizing them, particularly writers whose need for words is great. Exploring these books is a minor fascination of mine right now.
Also, since the blogging medium is rich with graphics and images, I have purchased a number of visual dictionaries to provide creative source material, so don't be surprised to find the occasional esoteric reference supplemented by either a link or an image to provide greater detail.
I recently bought the Visual Thesaurus, and I like it so far. I frequently use mind mapping, so the interface is very intuitive for me, and the branched searching for words is great exploration. Another cool resource is Visuwords a website based on the same mind-mapping principles.
I am addicted to Babylon 8. I believe it is the greatest writing tool available for those who write in a word processor as I do. It is expedient to right-click and call up dictionary, thesaurus and encyclopedia references, and it is much faster than looking words up in big, clunky books.
So why do I keep the big books? Kinesthetic learning is not dead, and there is a tactile pleasure with thumbing through any book, but I like the big books for browsing, embarking on journeys of discovery. For instance, a random opening of the dictionary led me to "plebe: a freshmen at a military or naval academy," to which I would add pledging fraternities which is where I heard the term. A few entries down is "plebs: the general populace." I have never used the word plebs before, but with as many times as I refer to the sheeple and make other references to the general populace, having another term is very helpful, particularly if it is loaded with negative connotations like plebs. Watch for it, as plebs will almost certainly appear in a future post — I may spare you from philistines — or maybe not.
I recently finished reading Spunk & Bite: A Writer's Guide to Bold, Contemporary Style by Arthur Plotnik. The only problem I had with the book was the frequent pauses to look up words; the author's vocabulary is impressive. I like his advice on selecting active verbs, and I focus on writing in the present tense with active verbs and reducing or eliminating words without propositional content. I also drop articles (a, an, the) whenever possible. The difference in pace and feel is the difference between a leisurely stroll and a breakneck bronco ride. The quicker pace makes for easier reader engagement which is ultimately what both you and I want.
I gravitate toward present-tense writing as a reflection of my inner world of present-tense living. I believe it breathes life into what can be, at times, a moribund subject matter. Auxiliary verbs and various states of being plagued my writing, slowed it down, and provided little important information. For instance, I began this paragraph with "I gravitate," when I could have said, "I have been gravitating." The latter implies the slow ongoing process which more accurately represents the nuanced truth, but who cares? The shorter version is punchier, and the nuanced version is only interesting to me.
I am work in progress, or is that "a" work in progress?
BTW, in case it isn't obvious, I truly enjoy the writing.
Housing Bubble new from Patrick.net
Irvine Home Address … 88 STEPPING STONE Irvine, CA 92603
Resale Home Price … $519,800
Income Requirement ……. $108,243
Downpayment Needed … $103,960
20% Down Conventional
Home Purchase Price … $581,316
Home Purchase Date …. 1/22/2010
Net Gain (Loss) ………. $(92,704)
Percent Change ………. -10.6%
Annual Appreciation … -127.0%
Mortgage Interest Rate ………. 5.05%
Monthly Mortgage Payment … $2,245
Monthly Cash Outlays …..….… $3,280
Monthly Cost of Ownership … $2,670
Property Details for 88 STEPPING STONE Irvine, CA 92603
Beds 3
Baths 3 baths
Home Size 1,600 sq ft
($325 / sq ft)
Lot Size n/a
Year Built 2004
Days on Market 2
Listing Updated 2/5/2010
MLS Number S604324
Property Type Condominium, Residential
Community Quail Hill
Tract Casa
According to the listing agent, this listing is a bank owned (foreclosed) property.
From the moment you walk into this property you will fall in love! This open floorplan features an upgraded kitchen with Granite countertops that opens to the family room with fireplace! Separate dining area with China Hutch! Downstairs bedroom/bathroom, and upstairs loft area with built in desk! Beautiful master bathroom with dual sinks and separate tub and shower! Large private balcony off upstairs bedroom with huge walk in closet! This property is a must see!
Wow! Over $500,00 for a 1050 sq ft, 2-bdrm, 35 yr-old condo?
I think there’s something wrong with the calculations today:
Home Size 1,050 sq ft
($281 / sq ft)
That would be $285,000, which sounds about right.
Is the list price wrong, or the total square footage wrong?
The data from the bottom was incorrect. I updated with the correct information. I apologize for the error.
Makes sense now… Thanks.
Stepping Stone is in Quail Hill, not El Camino Real. Still $495/sf huh?
IR,
you are very fortunate to have a passion for something that you have talent in. It has always impressed me how you are able to crank this thing out daily with fresh themes and energy without showing signs of boredom or burnout. Your post today gave me a glimpse of why you do it… it appears that you actually enjoy it. I had a doctor once who practiced medicine wayyy beyond retirement age because of what he got back from it. When he retired I selfishly asked myself, “now what I am supposed to do for a doctor” as if it was all about me. In the past I have found myself asking “what am I supposed to do about real estate reality after IR becomes “Irvine Homeowner” and moves on? I’m guessing now that your alias might change and the blog might change, but your passion for writing and the subject will force you to hang around a little longer than you have to. At least I hope that it does.
IHB = CAR or NAR
TI = TIC
Annoying too much
Using reflexive verbs is far less “punchy”.
Using action verbs results in a far more “active” and engaging style.
Example:
I have been brushing my teeth.
I brushed my teeth.
The second form is shorter and to the point. It’s an action.
Or, in RE parlance, it would be an @cTiOn!!!
😉
The bank didn’t overpay. If the condo goes for the market price, the bank would need to declare a loss. When bidding the full price, the bank has not loss any money. They actually made a profit because of the receivable are counted as profit, but let’s see if the bank can collect those receivables. Another pretend and extend move. Possible the bank can arrange for the govt or some sucker to take the hit.
Quick, you need to buy before you’re priced out of the market. Only a 15 min. drive to Univ. High and only $350 per month HOA. 1600 sf on two levels and not 3 levels for lux. living. This home won’t last long. Not a McStacker. :}
“They actually made a profit because of the receivable are counted as profit, but let’s see if the bank can collect those receivables.”
This reminds me of all the schemes that companies used to cook up (and still do today) using GAAP to inflate revenues and earnings by providing 0% financing on accounts receivables. Funny how nobody looks at Cash Flow statements (especially cash flow from operation) anymore for the soundness of companies (hmmm….Enron comes to mind).
Back to this subject: $500k+ for a CONDO? F that. Until the days where $500k SFHs are not selling that fast in the better part of Irvine (i.e. TR, WP, Oak Creek, NW), we can declare a bottom on Irvine (well, at least I can).
Speaking of vocabulary, here is a nice site that donates 10 grains of rice to the World Food Program for every vocab word you get right
http://www.freerice.com
Also, if trying for fun text effects, try the HTML marquee tag. Or the annoying HTML blink tag
Let me see if it works for me.
<blink>Stuff</blink>
I guess not, your editor is escaping my postings. Should work for you if you paste it in the source of your page though.
be wary of ‘free’ handouts of rice or corn, except when there is short term catastrophe. They are like morphine, the patient quickly becomes addicted and can’t live without the free supply.
Yes, normally people who have NOTHING and depend on compassion from strangers, rely 100% on the person supporting them.
Maybe in Woodbury Renter’s opinion we shouldn’t feed starving people at all because they just end up hungry again. Excuse me, could you close the blinds and windows, I can’t hear my stock report with the cries of the sick and dying.
Way to show that good ol’ boy compassion!
The Foxhill REO house that was profiled on this blog a month ago is ready for a new knife catcher/FCB/Kool-aid guzzler… The REO sold for 615k and is not back on the market for 765k…tidy profit for month of work…
if people keep buying at these crazy prices then i doubt we will ever come out of the bubble…higher prices will be the norm.
“Beautiful Newly Remodeled Home in one of the most sought after areas of Irvine.”
It’s **remodeled** 🙂
Sought after? 92604? Ha….don’t make me laugh.
Just wait Mike…just wait…and you’ll see housing deflation this year. And this time, there’s nothing the Fed nor Treasury can do about it.
While, the statement “…most sought after..” might be an exaggeration, 92604 encompasses the Woodbridge area which is definitely NOT something to laugh at.
JMHO
Is that the outdoor space, the balcony off the bedroom? No patio? Do you put your barbeque there? I’m sure the neighbor’s balcony right within reach will love the smoke. But, you could share and hand them a burger and beer.
i love reading your blog. it must take a lot of time. and i don’t know how you come up with a new song daily. 🙂
You have to love the irony of this headline…this is from the weekend WSJ not The Onion:
Mortgage Bankers Association Sells Headquarters at Big Loss
Great article.
I was laughing at the concept and the fact that they tried to use a variable-rate, 30-year taxable bond to try to get themselves out of it, priceless. They even tried their hands at being floplords.
Are these the same brilliant thinkers who are telling everyone else to tough it out on their underwater properties? Sure enough when they go almost 50 percent underwater, they bail out. Typical.
I am losing more and more trust in US Bankers and financial people. I say rent for life or purchase the thing with cash. Clearly, these people cannot be trusted.
Thanks Mr. Scott, you brightened my Sunday.
sorry… i can’t read today’s blog 2/7. it comes up not white but blue background.
Thanks for bringing this to my attention. There were a few problems with the tables that I have now fixed.