Irvine isn't the only community that thinks it's special and their house prices are immune to decline. Today we look at the small Orlando suburb, Celebration, Florida.
Irvine Home Address … 17 ALTEZZA Irvine, CA 92606
Resale Home Price …… $650,000
Under the sea we off the hook
We got no troubles
Life is the bubbles
Under the sea
Under the sea
Since life is sweet here
We got the beat here
Naturally
The Little Mermaid — Under the Sea
The last place I lived in Florida before moving to California was the Disney creation, Celebration, Florida. I had just sold my house in Leesburg, Florida, and my soon-to-be wife and I rented the apartment (now condo) above Max's Cafe downtown. It sold me on living in planned communities.
Celebration, Florida, is a small suburb of Orlando. The property was designed and developed by the Disney Company on their own land under principals set down by Walt Disney himself. Celebration was Walt Disney's utopian vision of the perfect American life.
After living there for a year, I felt they did a wonderful job of creating a small town in large and growing metropolis. Particularly if you lived at or near the downtown like we did, you had recreation, dining, and entertainment in an enjoyably walkable place.
(mine was in the building on left, middle of three with large white awnings over the corner restaurant)
Celebration has much in common with Irvine. Both communities were developed by a single landowner ensuring a consistent level of quality throughout. Both communities were marketed at a more affluent move-up buyer but smaller products at lower price points provided a nice mix of owners. Both communities also saw house prices inflated dramatically during the housing bubble.
So where is Celebration different from Irvine. Irvine must be special because Celebration's house prices have crashed while Irvine's have held up. It must be different here, right?
Pixie Dust Loses Magic as Foreclosures Slam Utopian Disney Town
By Kathleen M. Howley – Dec 13, 2010 9:00 PM PT
Walt Disney Co. built Celebration, Florida, as an idealized version of a circa-World War II small town, where litter-free streets are lined with white picket fences and front porches entice neighbors to sit after dinner.
Now, there’s trouble in the 16-year-old paradise set within earshot of the nightly fireworks at Walt Disney World Resort.
Celebration’s foreclosure rate is about double the state’s pace as homeowners who paid a premium for a vision of utopia fall behind on their mortgages. Earlier this month, a resident on the verge of losing his house shot himself after a 14-hour standoff with police. Three days before that, the town had its first murder when a man was bludgeoned with an ax.
Celebration had everything going for it making even the most insane prices seem like a logical recognition of value by the market. There was no reason to believe house prices would decline in Celebration except for the fact that prices were way too high.
“A lot of people bought homes in Celebration thinking Tinker Bell had sprinkled the town with pixie dust,” said Michael Olenick, chief executive officer of mortgage-data firm Legalprise Inc., referring to the character in Disney’s “Peter Pan” movie whose magical dust allows people to fly as long as they think happy thoughts. “Reality is hitting hard.”
The foreclosure rate in Celebration since the beginning of 2009, based on notices of so-called lis pendens that initiate a case, is one for every 20 residents, compared with one per 48 people in Florida as a whole, according to Legalprise, in West Palm Beach. Celebration home values have dropped as much as 60 percent from the 2006 peak, while statewide values are down 51 percent, data from Seattle-based research firm Zillow Inc. show.
That is astonishing to me that a premium community could fall so hard. Celebration is great. Desirability is not causing prices to crater there.
‘Fantasyland’ Premium
Celebration foreclosures are happening at a faster pace in part because property owners in financial trouble are walking away from vacation homes in the town, where real estate sells for about 30 percent more than surrounding communities, said Olenick. Before the recession, people were willing to pay more for living in a Disney “fantasyland,” he said.
“The harsh reality is, bad things happen in Celebration too, both in real estate and in life,” Olenick said.
It's a good thing those bad things don't happen here.
… Disney started building Celebration in 1994, and the first residents arrived in 1996. Located on the southern border of Disney World, 25 miles south of Orlando, it was designed by Robert A.M. Stern, dean of the Yale University School of Architecture, and Jaquelin Robertson, a founding partner at Cooper, Robertson & Partners in New York. The style of the development is called New Urbanism, also known as neotraditionalism, emulating 1950s mixed-use neighborhoods where it was easier to walk than to drive.
Kilwin’s, Woof Gang
In the center of town, bordering a lake constructed by Disney, stores include Kilwin’s, a seller of ice cream and fudge, and the Woof Gang Bakery, where dog owners buy gourmet treats. At the Market Street Cafe, there’s an old-fashioned soda counter where diners can order the restaurant’s specials: meat loaf and chicken pot pie, followed by apple or pecan pie.
Lexin Capital, a New York-based private real estate investment firm, bought the 18-acre Celebration downtown from Disney in 2004. Mike Nunez, a spokesman for the company, didn’t return calls seeking comment. Disney still owns some commercial property in the town, according to Marilyn Waters, a spokeswoman for the Burbank, California-based company.
I find it interesting that Disney sold the downtown. It was not a great commercial center when I was there prior to the bubble, but the lack of foot traffic was likely due to the shortage of households in the early stages. Disney took a risk developing the commercial before the residential was there to support it.
Twice the Value
Living 12 minutes from Disney World’s Magic Kingdom, with a backdoor access road, comes at a price. Buying in the 10,000- person town requires paying what locals call the “Celebration Premium.” The median home value, including single-family properties and condominiums, was $250,800 in October, almost twice the $127,300 for the entire state, according to Zillow.
Sounds like Irvine and the "Irvine Premium," doesn't it?
Properties in Celebration are priced as high as $3.9 million for a six-bedroom, 8,000-square-foot (743 square-meter) mansion on a three-quarter-acre lot, according to Realtor.com. At $529,000, buyers could get a four-bedroom, 2,800-square-foot home with a wrap-around porch on about a sixth of an acre.
For condominiums, $90,000 will buy a two-bedroom, 1,000- square-foot unit, according to Realtor.com. At the top of the market, a five-bedroom, 3,400-square-foot, townhouse-style condo is priced at $675,000.
Four years ago, at the height of the real estate boom, the least expensive single-family house in the June to December period sold for $350,000, according to Kathleen Carlson, owner of Imagination Realty in the town’s center. In the same period this year, it was $210,000, she said.
The lowest condominium sale in the boom was $193,000, compared with a sale at $70,000 for the 2010 period, she said.
On a percentage basis, condos rose more and fell more than larger single-family detached properties. Of course, many of the mid to high end properties have not hit bottom yet either.
Town Maintenance
All owners pay about $860 a year for private trash pickup and recreational facilities, including parks, community pools and baseball fields. Condo owners pay an additional maintenance fee that varies depending on location.
The town’s Architectural Review Committee maintains strict control over the appearance of properties, dictating paint colors, regulating holiday decorations and overseeing the size of political signs that can only be posted in the 45 days leading up to an election.
Most residents see the rules as “protection,” said Carlson, who lives in a Celebration home with a wide front porch where she drinks coffee with neighbors on Sunday mornings.
“Most of us came here not because of Disney — we came because we wanted that type of control over our neighborhood,” Carlson said, “You don’t have to worry that your neighbor will suddenly start parking an old pickup on his front lawn.”
Isn't that Irvine? People don't come to Irvine to seek freedom to do whatever they want with their properties. People buy here because they know they aren't going to devalue their property, and they want neighbors that won't hurt values either. The HOAs get larger, take on more maintenance responsibilities, and stop homeowners from painting garish colors or parking cars up on blocks in the front yard.
Six Acceptable Styles
Like Carlson’s house, most properties have front porches that encourage neighborliness. There are six accepted historical architectural styles for homes: Victorian, Classical, Colonial Revival, Mediterranean, French, and Coastal.
While white picket fences outline most front yards, not everyone is allowed to have them. That would look too fake, said Laura Poe, a spokeswoman for the town. The architectural committee decides who can have the old-fashioned fences and who must have short, trimmed hedges.
The town shows its Disney heritage in annual seasonal shows, each with special effects originally designed by the entertainment company. In October, leaf-shaped confetti shoots out of lamp posts in the village center to simulate colorful falling foliage. During the month of December, the posts emit what locals call snoap — soap suds that look like snow.
Unlike in real life, the snow falls four times a night, on schedule, and dissipates without shoveling.
“Two of my grandchildren think we live inside Disney World, with Mickey Mouse,” said Celebration resident Sessoms, referring to a four-year-old and a five-year-old. “Except for the recent violence, I can understand why they would think that.”
Irvine is Celebration, minus the price crash. Will Irvine continue to escape the carnage? Perhaps we have less debt and fewer debtors here?
She borrowed and spent every penny she could get
The owner of today's featured property really became adept at raiding the housing ATM. She stopped paying about two years ago, but the property is only now making it to market. This one only hid in shadow inventory for about six months after the bank bought it. They probably couldn't find the right renter and decided to sell.
- This property was purchased at the bottom of the last housing bubble. She paid $241,000 on 9/12/1997. She used a $202,000 first mortgage and a $39,000 down payment. She didn't want to wait long to get back that down payment money.
- On 1/15/1998 she obtained two a stand-alone second mortgages for $25,000 and $16,000 respectively.
- On 8/12/1999 she refinanced with a $294,000 first mortgage. Less than a year into the house, and she managed to withdraw her down payment plus $53,000.
- On 2/21/2001 she obtained a stand-alone second for $75,000.
- On 10/10/2002 she refinanced the first mortgage for $374,000.
- On 7/3/2003 she refinanced again with a $454,500 first mortgage.
- On 8/29/2003 she refinanced with a $456,000 first mortgage.
- On 12/18/2003 she obtained a $100,000 HELOC.
- On 1/4/2005 she refinanced with a $600,000 first mortgage and a $150,000 stand-alone second.
- On 12/9/2005 she refinanced with a $680,000 first mortgage and a $170,000 stand-alone second.
-
Total property debt was $850,000.
- Total mortgage equity withdrawal was $648,000.
- She squatted for about 15 months.
Foreclosure Record
Recording Date: 10/02/2009
Document Type: Notice of Sale
Foreclosure Record
Recording Date: 05/04/2009
Document Type: Notice of Default
She quit paying in late 2008 or early 2009, probably when she saw the housing ATM was turned off for a while. The bank foreclosed on 5/10/2010 for $749,912. For the last 6 months, they have been "processing" this REO.
Irvine Home Address … 17 ALTEZZA Irvine, CA 92606 
Resale Home Price … $650,000
Home Purchase Price … $241,000
Home Purchase Date …. 9/12/1997
Net Gain (Loss) ………. $370,000
Percent Change ………. 153.5%
Annual Appreciation … 7.4%
Cost of Ownership
————————————————-
$650,000 ………. Asking Price
$130,000 ………. 20% Down Conventional
4.87% …………… Mortgage Interest Rate
$520,000 ………. 30-Year Mortgage
$132,604 ………. Income Requirement
$2,750 ………. Monthly Mortgage Payment
$563 ………. Property Tax
$167 ………. Special Taxes and Levies (Mello Roos)
$108 ………. Homeowners Insurance
$167 ………. Homeowners Association Fees
============================================.jpg)
$3,756 ………. Monthly Cash Outlays
-$468 ………. Tax Savings (% of Interest and Property Tax)
-$640 ………. Equity Hidden in Payment
$243 ………. Lost Income to Down Payment (net of taxes)
$81 ………. Maintenance and Replacement Reserves
============================================
$2,972 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$6,500 ………. Furnishing and Move In @1%
$6,500 ………. Closing Costs @1%
$5,200 ………… Interest Points @1% of Loan
$130,000 ………. Down Payment
============================================
$148,200 ………. Total Cash Costs
$45,500 ………… Emergency Cash Reserves
============================================
$193,700 ………. Total Savings Needed
Property Details for 17 ALTEZZA Irvine, CA 92606
——————————————————————————
Beds: 3
Baths: 2 full 1 part baths
Home size: 2,056 sq ft
($316 / sq ft)
Lot Size: 2,550 sq ft
Year Built: 1996
Days on Market: 32
Listing Updated: 40525
MLS Number: S639477
Property Type: Single Family, Residential
Community: Westpark
Tract: Trov
——————————————————————————
According to the listing agent, this listing is a bank owned (foreclosed) property.
BACK ON THE MARKET!!! Don't miss out on this beautiful home located in the Westpark area features 3 bedrooms plus a bonus room, large master bedroom with walk in closet, upstairs laundry room, fireplace in living room, 2 car attached garage, and much more! .
Irvine is not Celebration. As an electrical engineer, I ask, where would a PhD engineer go to work if they lived in Celebration? UCF? SoCal has a long history of tech jobs, and currently Broadcom is pretty high on people’s list of places to go.
Irvine is 15X Celebration in number of housing units. Irvine ‘only’ has 38.5% of residents moved to their homes since 2005, while Celebration has 50%, half of buyers are bubble buyers. Irvine is only 55% owner occupied, while Celebration is 72% owner occupied – are landlords better at not heloc’ing properties? 38% of Irvine residents with a mortgage spend > 35% of HH income on housing, while Celebration is 46%.
Irvine is also a city that is near a real metropolis (LA). Celebration is a tiny suburb on the outskirts of a ‘fake’ city. There are entertainment activities in Irvine that aren’t available to Celebration – you could get season tickets to the Angels. Are you really going to go to the theme parks 80 times a year? Being a city is also a huge difference. There are economies of scale that come with size.
I like analogies and they can be helpful to understanding things, but this one doesn’t work well. If you are going to compare, it’s better to look at the numbers than in the idea of two single-landowner, master-planned communities being similar.
Fake suburb of a fake city? That sounds about right.
You did point out the worse part. That part of central FL has an educated population that could compete with the brightest in Las Vegas.
Throw this one into the Las Vegas and Riverside trash pile. Contstruction jobs and tourism, it’s time to invest !
Fake suburb, I agree, fake “city” of Orlando, totally disagree. As for education and jobs…have you heard of Cape Canaveral? Florida Institute of Technology? Embry-Riddle? Special Forces Operational Command? They are all nearby and with no state income tax and cheaper housing, FL beats CA on many levels.
Google says that the commute from Celebration to Cape Canaveral is longer time-wise than the commute from Irvine to LA. Mile-wise it is 50% longer. Orlando’s economy is predicated on Disney, Universal & Sea World, by definition imitations of things.
For young engineers NASA is not the best option. Look at number of jobs added over the past 10 years vs. Broadcom, as just one Irvine employer.
FIT is in Melbourne, 80 miles from Celebration. Go 80 miles south and you’re in Jupiter. I’d never say that FIT is somehow an impact on Jupiter’s employment situation.
Other states are picking off firms from The OC. Most of these states have no state income tax, and unlike California, they actually encourage business to prosper.
Unfortunately for us who decide to stay in Orange County, we’re the oppressed to the tyrants in Sacramento who have an axe to grind!
To think that California has a high income tax, property tax, sales tax and capital gains tax … and it still ain’t enough to feed the beast in Sacramento.
I agree. If the California Govt does not mend its way soon, we will probably see a slow erosion of population and jobs to other places.
“…currently Broadcom is pretty high on people’s list of places to go.”
That statement right there shows me that you are smoking something funny.
“As an electrical engineer, I ask, where would a PhD engineer go to work if they lived in Celebration?”
The question you should be asking is, “Do Irvine home prices make sense when an engineer with a doctorate has to stretch in order to afford them?” I don’t know about Broadcom, but quite a few of my friends at Qualcomm are Electrical Engineers with PhDs, and they don’t earn 200K salaries. So how do you justify house like this one asking for 650K? Who are all of these people who earn these super high incomes?
I tend to agree with this. I am an electrical engineer and the only reason i could afford a home in Irvine is because ours is a 2 income household. Very difficult to justify these prices with a single income.
Most of my friends are renting… and waiting.
You should google the ‘two income trap’ a great video showing why the middle class is collapsing.
The major reason is that when you rely on two incomes to pay bills you double your chances for a bad outcome. You are only one illness or job loss from potentially not having enough income to pay mortgage and bills.
It is sad.
B
I see this comment a lot but is it really all that much more of a trap than single income?
If the single earner gets sick… aren’t you in a worse scenario because ZERO money is coming in? At least in a dual income household, if one stops, the other is still there providing some kind of money flow.
And in the case that the other spouse is able to work, the non primary in the single income house may have a harder time finding a job due to either inexperience, outdated job skills or lack of current qualifications.
Either way, if the family budgets and plans correctly, they can deal with sudden losses with savings and insurance.
irvine_home_owner,
Think about it this way. If a wage earner has a 5% chance of losing his or her job, that translates to a 95% probability of keeping that job.
If you have two wage earners, each with a 5% probability of losing his or her job, that means there is roughly a 90% chance that atleast one will lose his or her job (0.95 x 0.95).
Oops, I meant a 90% chance that both will keep their jobs.
Oh nevermind, I was right the first time too.
No wait, I meant a 10% chance that atleast one loses his or her job. This is getting confusing so I will stop.
But I’m more focusing on the outcome if a wage earner loses their job.
In the single income family, a job loss equals 100% lost income, whereas in a dual income family that’s 30-70% depending on which one lost the job.
Plus, in a dual income, they can probably take a lower paying job and still get by… not so sure with single income.
Again, it all depends on budget management but a dual income household seems “safer” to me.
That’s true. But if the dual income home needed to stretch in order to afford their monthly payments, the outcome will be the same whether one or both lose their jobs.
Alternatively, think about it this way. Take a single income home with a husband who works and a wife who stays at home. If that husband loses his job, both he and his wife can try to go out and find new employment.
BTW, I have watched Elizabeth Warren’s two-income trap lecture on youtube.
The key here is that a 2 income household should not stretch a lot to afford a home.
For the house I bought the DTI is 34 which I think is excessive with one income, however with my wife’s income it reduces to 17 which is very comfortable.
If you have stretched to buy $1 million+ homes with DTI’s > 35 with 2 incomes it is very risky and not financially healthy at all. Looks like a lot of people were just doing that during the bubble , look where it has landed us.
The math doesn’t compute. You need to make the comparisons equitable to work. If the single had to stretch to make their nut, they would be worse off than the dual if only one earner lost their job. Think of it more as comparing a single earner who had his/her wages cut to a dual income where one of the earners lost their job.
Not so fast. I mentioned this previously.. but what will make that wife viable in the marketplace? Who will take care of the kids (which I assume she stayed home for).
A working couple can find work more readily than a working spouse and a non-working spouse because the former has a bigger and more current network to leverage in addition to updated skill sets the market may require.
Again… buying a home is a trap regardless of single or dual income if the household is not budgeted correctly. I don’t think single income is any more safer than dual.
I don’t think there’s anything wrong with my math. No income or 1/2 income — if they were stretching to make their payments before, it won’t matter because the outcome will be the same — they’re screwed.
I think you have a point about the hypothetical couple with the wife with little or no experience. On the other hand, that was the situation when my parents bought their home almost 20 years ago. Today, my mom, who was a stay-at-home house wife for much of my childhood, makes more money than my dad.
I think it absolutely is a more dangerous trap when you’re dependent on two incomes, especially if you’re dependent on two fairly high incomes.
It does matter. With 1/2 income, you’re screwed but you can eat, with zero income, you starve too. In a dual income, you can lose your home but still rent somewhere… in a single, you’re done.
I would choose 1/2 income over zero income any day.
And why is dual income more dangerous? You assume they are fairly high incomes but I would think in a single income, that would have to be fairly high (if not higher) too. Like I said… make an equitable comparison and either is just as much of a trap.
The point isn’t whether one or both parents should work. The point is that it’s more dangerous to buy a home that requires two incomes instead of just one, which, I know, is obvious to everyone, but nevertheless, that’s what most married couples are doing nowadays.
We’re not talking about people starving or anything like that. We’re talking about people losing their homes or filing for bankruptcy, etc.
You’re still missing the point.
If EITHER (single income or dual income) has to make a certain amount to buy a home… BOTH are EQUALLY dangerous.
AHHH but you forgot the part about the probabilities…
Just like in a RAID disk with no data mirroring — as you increase the number of disks, you increase your chances of failure.
Everything in life is a risk.
The risky part of buying with 2 incomes has nothing to do with losing a job. You never avoid those type of life risk.
The risky part is the wife realizing she wants to be a stay at home mom, but can’t and is miserable.
This is a valid point. If there is any doubt in the mother’s mind that she might want to stay at home , keep the DTI with one income reasonable…period.
“You never avoid those type of life risk.”
In that case, by all means, buy your 750K house with your combined income is 150K. Shut off your brain and do whatever you want and you’ll have a front row seat for the collapse of the middle class.
IR’s income ‘requirement’ for this home is $130k, which should be on par with what a PhD would be making at BRCM or QCOM. Now, whether that is stretching or not is another question. Whether a PhD with two kids would consider 2000 sqft a squeeze or not.
My point was that PhD EE’s make good salaries and there are quite a few in Irvine. There are very few in Celebration and other outskirt suburbs of Orlando and the other major cities of FL. The top employers in Irvine are UCI, Irvine schools, Broadcom, Edwards Lifesciences & Allergan (botox). Those are higher paying jobs on average than they types that would be most prevalent in the Orlando area.
Were it not for family in FL, I would choose SD or Irvine over Celebration w/o even thinking.
I think IR’s calculation is generous.
With a 132K salary , i.e. ~ 11000 monthly gross salary and a 3750 monthly payments, the DTI is 33% which I think is stretching a bit too much.
However, some might not find 33% to be excessive and also i have not taken the mortgage interest deduction into account. Maybe I am too conservative…to each their own.
The calculation also assumes a 130K down payment. Even if you have a 130K salary, it will take time to save up that much. More important — is it really worth it?
High DTI’s are common. You can look them up at the census.gov website, but I remember a pretty high percentage of Irvine is > 35%.
As for the $130k down payment, I totally agree that it is not really reasonable to couple that with a $130k salary. Saving 10% takes 10 years.
It’s ironic that the era of most rapid appreciation of homes, with the fastest move-up market, was also seeing the lowest down-payments.
However, there are still 10% down loans and a 585k would be a gse loan for Irvine.
Orlando? You are joking right? You actually enjoyed living there, I hate spending a day there.
Funny, I feel the same way about Irvine. I could probably survive in Orlando for a couple of days at least. Irvine is boring.
Educational attainment, as measured by % of residents with a Bachelor’s degree are roughly equal for Irvine and Celebration 64% vs 60%. I would imagine a difference is that people move to Irvine for the jobs, but people move to Celebration as a destination. I may be wrong about that because I’ve never been to either place.
The biggest hole in the analogy is that Irvine is not a “vacation home” area. The vast majority of residents in Irvine are living there as their main and only property. While there are a lof of investment buyers, there aren’t people buying second homes to hang out there during vacations.
Irvine could crater, but not for the reasons listed here. Apples and oranges.
30% of housing units in Celebration are vacant vs. 5% in Irvine, per census.gov. I don’t know a better way to quantify the ‘vacation home’ idea, but agree with it.
The reality is it’s very difficult to find a true comparable to Irvine.
Either you find areas that are too premium like: Manhattan Beach, SF, NY, Cupertino, etc.
Or you end up with the scrap heap of Celebration, FL,,, Las Vegas, Riverside, etc
If I had to come up with my best set of Irvine comp cities, they would be:
Thousand Oaks, CA
Walnut Creek, CA
Greenwich, CT
Even those aren’t very good comps
Pleasonton, CA?
No, that’s a comp for Bakersfield.
No, that’s a comp for Bakersfield.
LoL
What’s with the hate?
Pleasanton may have a smaller population, but has plenty of high tech / high paying jobs, is close enough to commute to two different major job centers (SF & San Jose), median household income of $100k+, median home sale price ~$650k.
San Ramon and Pleasanton are both very good comps for Irvine. Don’t listen to the hate. It’s nice up there — nicer than Irvine, in fact. And the schools are just as good. Actually, better than Irvine in San Ramon. If I had to move up there, San Ramon would be at the top of my list. Pleasanton would be a close 2nd.
My bako comment was harsh. There is too much nice farmland and empty space for Pleasonton to be a comp.
btw, I don’t live there, I live in Irvine. I used to live in Danville, and Irvine always reminds me of that entire area. There’s plenty of farmland in Irvine too…
I used to live up there, too — for four years. And spent a lot of time working on clients in the tri-valley. Anyone who says that area is not a comp for Irvine does not know what they are talking about. Of course Danville is not really a comp, though. It’s much more exclusive than Irvine.
Atherton, CA is nice
Similar to parts of Irvine.
“The reality is it’s very difficult to find a true comparable to Irvine.”
I’m always confused when I hear people on this forum talking about Irvine as if it were somehow unique and different from every other city in the world. To me, Irvine doesn’t seem much different from the rest of South Orange County or North San Diego County. In fact, it would seem like Irvine should be *less* desirable than many other places around there because it doesn’t have any beaches.
What is it about Irvine that makes it so special? Do you guys honestly think it’s on par with cities like SF and NY?
I think the northern NJ suburbs would be just about right for an Irvine comparison. Close to NYC, people who ostensibly have high incomes, etc., etc., etc.
what percentage of Irvine residents work in LA? A disproportionate share of the NJ suburbs commute into NYC.
Irvine does have the added benefity of being a job center close to another major and diverse job center.
Specific towns in North Jersey aren’t a terrible comp, but not perfect. It’s difficult to find a perfect comp.
Right. There are high-paying jobs here in Irvine and OC. If you had to, you could work in LA. You could even work in SD if you had to.
I could’ve written this article for the Times the day the law passed in CA: http://finance.yahoo.com/news/Homes-at-Risk-and-No-Help-nytimes-594105783.html?x=0&sec=topStories&pos=6&asset;=&ccode;=#mwpphu-container
Asking a lawyer to receive payment from a deadbeat borrower once the modification is complete, is asking the lawyer to work for free. Good luck with that.
If their goal was to eliminate lawyers from the mod process, then congrats. There are very strong arguments that on balance, this is better for consumers.
The premium areas of Irvine have a seemingly endless supply of FCBs willing to overpay
A Black Swan?
http://www.nbclosangeles.com/news/local-beat/Scientists-cite-Atmospheric-River-for-Near-Continuous-Rain-112228904.html
Its a long shot, but it might not be a bad idea to review insurance policies/coverage.
So where is Celebration different from Irvine. Irvine must be special because Celebration’s house prices have crashed while Irvine’s have held up. It must be different here, right?
IR, it looks like the comments answered your question. Just the mere fact that prices have held up better shows some proof Irvine being different.
This article seems a bit grasping but I think even you know there is a difference.
A good question for all the properties you profile is will they sell at the prices that non-Irvine commenters are so amazed at? Seems like they are. Even I think they are too high but someone is buying them. And today’s property just got “reduced” to $635k. Still high but in Westpark II, that’s probably going to be close to the final price.
It has taken about 30 years of continues pumping debt to reach the end in 2008 (moment of truth). That was the year the music stopped, and the Govt took over and/or manipulated most free markets … all in an attempt to artificially prop up asset prices.
It’s time for the Fed “one trillion” hats- as of 2:00 pm Eastern, the Fed’s Treasury holdings have surpassed $1 trillion. Add to this the well over $1 trillion in MBS and agency debt held by the Fed, and there is your perfectly quantified reason why the S&P has just hit a two year high, and why the Nasdaq bubble is alive, back, and will soon retest its 2000 highs. Basically, with the Fed the de facto purchaser of all securities with a yield of under 4%, the entire definition of a risk-free rate per the MPT has to be scrubbed. Tylen Durden ~ ZeroHedge
When investors can CASH FLOW PROPERTIES IN IRVINE AT A SUSTAINABLE PROFIT, then you can say “Irvine Home’s have held up”. Until then, Irvine continues to be the beneficiary of unsustainable govt & Fed policies.
In the mean time … tic, tic, tic …
“IR, it looks like the comments answered your question. Just the mere fact that prices have held up better shows some proof Irvine being different.
This article seems a bit grasping but I think even you know there is a difference.”
No, I don’t see much of a difference. Size perhaps.
The people in Celebration believed their house prices could not go down, and they were mistaken.
I don’t think most people in Irvine think their prices won’t go down.
But they do think they won’t go down as much as other areas.
Translation: If the bulk of Irvine’s inventory ever does drop across the board the predicted 40%+… that means other areas have dropped more.
Even you have scaled back your percentage drop due to government intervention (which everyone claimed wouldn’t do anything).
So size only? How about weather? Location? I would much rather live on the west coast than the east coast. Would YOU move back to FL?
IR, everyone thought that home prices wouldn’t fall at all, from apartment/condos in inner-city Miami, Ft Lauderdale. Los Angeles, to McMansions in the South Florida or Phoenix suburbs. Think about the MBS’s. I’ve posted a discussion between a money manager and someone at a ratings agency. Not only would many MBS tranches see losses if prices went down, they’d see losses if prices just stayed flat! Virtually our whole banking system (minus the magnetar guys working with Goldman) was balanced on the pin of constant home price appreciation, nearly everywhere.
Just having the belief that prices couldn’t go down is not sufficient to paper over all the other obvious differences.
Hey Irvinates… Turns out that CPAs who gave the city of Bell a clean bill of fiscal health were from the Irvine office of Mayer Hoffman McCann (MHM).
These sheisters should be thrown in jail just like the Bell criminals. We live in a corrupt society that gets worse everyday.
Hi, this my first post here. What prompted me to post is someone comparing Irvine to Thousand Oaks, which I happen to rent in. Here is my take :
Everyone here in Thousand Oaks believed it is “special” due to Amgen and other high end companies, and for the most part prices are ONLY down about 30% for the most desirable places. However, in the past three months we are seeing MASSIVE price drops in a nearby town, Moorpark, where condos are now close to 45% off from the peak. Care to think what that does to Thousand Oaks prices? Who the hell will buy here if Moorpark is at least 30% cheaper, and just another 10 minutes drive??? Their schools are just are good.
The same myths that applied to Irvine : rich Asians, Greeks, or Icelanders also apply to Thousand Oaks. These rich FCB keep buying houses until one day … they don’t.
Special is an adjective, not a number. Special can get a whole lot cheaper.
The Woodlands outside of Houston is similar to Irvine.