Economists from the California Association of realtors are projecting increasing prices in Orange County next year. What a surprise… not.
Irvine Home Address … 10 LAKEVIEW #79 Irvine, CA 92604
Resale Home Price …… $465,000
.png)
Any way you want it
That's the way you need it
Any way you want it
She said, Any way you want it
That's the way you need it
Any way you want it
Journey — Any Way You Want It
Any way you want it, that's the way they'll say it, any way you want it. realtor associations exist to tell buyers what realtors believe buyers want to hear. realtors cannot conceive reasons buyers may want to buy if prices are drifting lower, so realtors continually tell people prices have bottomed. realtors are unconcerned whether or not this is the truth, they only care that their statements motivate people to buy.
Will O.C. home prices go up in 2012?
September 24th, 2011, 1:00 am — Jeff Collins
If things go as expected, the typical California house will see its value rise $5,000 next year. In Orange County, the price at the midpoint of all sales could go up by $10,000 to $15,000.
That’s the forecast unveiled this month by California Association of Realtors economists Leslie Appleton-Young and Robert Kleinhenz, who forecast that home sales and prices will go up in 2012, but not by much.
Appleton-Young and Kleinhenz took reporters’ questions during a conference call about their forecast, as well as some direct questions from us. Here’s what they said …
Us: What’s the outlook for the Orange County housing market in 2012?
Robert: Right now, Orange County is behind last year’s sales by 6.7% on a year-to-date basis (through August), but the market will reduce or eliminate that deficit by year end.
Why? What would make sales volumes increase at the end of the year. There is one possible answer: falling prices. Realistically, the only way volume goes up is if prices go down.
The local economy is doing somewhat better than elsewhere in the state and this should carry into next year, and the share of distressed sales is among the lowest in the state at 32% in July compared to 35% a year earlier, so county home sales should improve by a bigger margin than the 1% gain for the state.
Are they joking? Lenders manage the percentage of distressed sales to within a few percentage points as they liquidate their inventory. If 32% is the lowest in the state, then we are nowhere near the end of problems with distressed inventory. The percentage distressed will remain between 32% and 35% for the next several years. I am shocked they even mentioned this.
The county median price should do better than the projected 1.7% increase for the state.
Us: If I’m a homeowner who’s been waiting for a recovery to sell, should I continue to wait or list my home now?
Robert: At this point, we are near the end of the peak market season for 2011, so the best chance of selling before the end of 2011 is probably in the next few weeks.
If our forecast is correct, selling in 2012 may mean that the home will fetch a slightly higher selling price.
Their forecast is not correct. With BofA and other banks increasing their foreclosure filings, the 2012 selling season will be greeted with an abundance of bank-owned inventory. If prices go up, it will only be because banks managed to limit their release of product. Given their pressures to raise cash, it's more likely lender liquidations will push prices down 2% to 5%.
The fact that mortgage rates are likely to stay low into 2012 makes it less urgent for would-be buyers.
I am surprised they admit that.
Beyond that, it depends on the individual homeowner’s circumstances (reason for selling, amount of equity in home or not, whether the individual will sell this home and buy another, etc.).
Us: Lenders recently ramped up the filing of default notices. Do you expect them to really ramp up the number of foreclosures now? And how much longer until foreclosures drop to more moderate levels?
Leslie: Let me take your second question first. It depends on the area, but I would say three to five years.
That's a surprisingly candid and accurate assessment.
Three (years) in areas where (foreclosures) haven’t been the majority of the market, closer to five in the inland areas, where I don’t think we’ve seen a lot of the supply that’s going to come through (yet) come through because you’ve got shadow inventory/negative equity homeowners that are still kind of in a holding pattern.
In terms of banks, Bank of America has switched gears a little bit,
A little bit? LOL! Bank of America foreclosure notices increase 116%.
and we saw a big increase in properties that are starting the process and we’ll likely see those coming through the pipeline – what is it? Six to nine months from now, something like that. Over 300 days. In terms of the other lenders, it’s kind of hard to say.
Robert: It is noteworthy that we’ve heard in the news that BofA was a major contributor to that uptick in the foreclosure filings for the month of August. Even with that uptick, compared to recent history, it’s still below last year’s level for August last year and well below the level for default filings (and) foreclosure filings that took place back in 2009 when California was clearly at the front end of this whole cycle.
The one and only reason foreclosure filings are below 2009 or 2010 levels is because lenders learned the level of foreclosure activity they believe the market can absorb. It certainly is not because they are out of people to foreclose on.
CAR’s 2012 Forecast for Calif. / Numbers are in the thousands; f=forecast 2005 2006 2007 2008 2009 2010 2011f 2012f
Existing houses 625.0 477.5 346.9 441.8 546.9 491.5 491.1 496.2
% Change 0.03% -23.6% -27.3% 27.3% 23.8% -10.1% -0.1% 1.0
Median Price $522.7 $556.4 $560.3 $348.5 $275.0 $303.1 $291.0 $296.0
% Change 16.0% 6.5% 0.7% -37.8% -21.1% 10.2% -4.0% 1.7
30-Yr Fixed 5.9% 6.4% 6.3% 6.0% 5.1% 4.7% 4.5% 4.7
1-Yr ARM 4.5% 5.5% 5.6% 5.2% 4.7% 3.5% 3.0% 3.1
Us: You said there are wildcards out there that could change your forecast for California in 2012. Which ones do you fear the most? What’s the Perfect Storm that would sink the economy and the housing market next year?
Robert: Wild cards are, by definition, unexpected events. That said, my biggest concerns are another recurrence of the European sovereign debt problem that creates uncertainty and economic paralysis, even though it also leads to a flight to safety in the form of U.S. Treasuries.
The election in 2012 is also a big wild card, and the lead up to November could also add to uncertainty and result in another lost year in terms of economic progress.
I am less concerned by a Perfect Storm per se, but more concerned that more mixed signals on the economy and politically will prompt both consumers and businesses to sit on their hands until they sense that the direction of the economy has become clearer.
Again, they miss the obvious. The wildcard out there is the desperation of banks for capital. If BofA feels they need to liquidate more than the market can handle to get their cash, then prices could really crater. If the desperation of BofA prompts other lenders to escalate their foreclosures as well, the cartel could collapse, and we could have a race to the bottom. That's the wildcard, just as it has been for the last several years.
Us: What’s the outlook for areas that got really hammered by the boom and bust cycle, such as the Inland Empire and the High Desert region?
Robert: The thing about the Inland Empire markets, and to some extent the Central Valley markets, you continue to have a lot of distressed properties in those markets. But the supply is constrained by the rate at which the lenders are processing these properties and moving them through the foreclosure pipeline.
Consequently, the amount of inventory in those markets tends to be lean. Prices may be down on a year-over-year basis, but I think as we move through this year, you’re probably going to see more price stability in those areas than in some of the other markets where you might have a higher concentration of equity sales. We still see some prices adjusting down with the equity sales, so you might be pleasantly surprised.
I fully expect to be pleasantly surprised as prices continue to drift lower. I would be shocked if they didn't.
The flip side, though, on the demand side is that you need some economic activity, and huge numbers of jobs were lost in the Inland Empire that were construction and real estate-related jobs, and those aren’t coming back anytime soon.
That's true enough. I still keep a toe in the water of the land development industry, and many developers are starting to prepare to deliver product again. Many of these developers are anticipating a resurgent new home market… in 2015.
So I think to Leslie’s point, we’re to continue to see distressed properties as significant part of the (market).
Us: The limit on loans that qualify for purchase by Fannie Mae and Freddie Mac is due to drop from $729,750 in Orange County to $625,500 on Oct. 1. In some counties, it will drop as low as $417,000. Above those amounts, borrowers will have to use higher-cost “jumbo” loans. Any chance Congress will act to extend the higher limits for lower-cost “conforming loans?”
Leslie: We’ve pretty much accepted the (Oct. 1) expiration as we looked at our forecast. Politically, over the last couple months it’s become clear that there just isn’t any consensus of action possible that would make an extension possible.
Obviously, we’ve been working quite hard to see if we could delay it in some way and it just doesn’t seem to be possible.
Hallelujah! Cool heads do prevail sometimes.
In cities and in counties where you’re looking at median home prices between $400,000 and $500,000, this is going to hit the market. I think that we will likely see evidence of people in that category rushing to get transactions closed by the end of September. There are reports that some of the lenders have already stopped lending at those categories already.
I think that we will definitely see it when we look at our data on closings in September and October. Clearly for that kind of jumbo and jumbo-light categories, it’s going to make financing more expensive. So the aggregate impact, I don’t know. But the marginal impact, it’s going to raise the cost of financing … and put a dent in those markets.
They got that one right too. Lenders stop conforming loans above $625,000 in July, home sale fall. Prices will fall, particularly at the price points where the conforming limit will impact the cost of financing.
She withdrew too much
The owner of today's featured property was not a routine HELOC abuser, but she did make a financially fatal mistake. She purchased the property for $265,000 on 5/12/2000 using a $225,200 first mortgage and a $40,000 down payment. She refinanced on 5/12/2000 with a $265,000 first mortgage and “liberated” her down payment. On 8/31/2006 she refinanced with a $487,500 first mortgage taking out $222,500 in the process. I guess she needed some money.
——————————————————————————————————————————————-
This property is available for sale via the MLS.
Please contact Shevy Akason, #01836707
949.769.1599
sales@idealhomebrokers.com
Irvine House Address … 10 LAKEVIEW #79 Irvine, CA 92604
Resale House Price …… $465,000
Beds: 3
Baths: 2
Sq. Ft.: 1659
$280/SF
Property Type: Residential, Condominium
Style: One Level
View: Peek-A-Boo
Year Built: 1977
Community: Woodbridge
County: Orange
MLS#: P800421
Source: SoCalMLS
On Redfin: 1 day
——————————————————————————
Perfect opportunity for the patient buyer. Live in the wonderful private, gated community of Arborlake. Enjoy the amenities of a gorgeous sand beach, clubhouse and recreational facilities. You'll feel like you're on vacation walking or boating around the lake. Inside your home, you'll love the remodeled, kitchen, engineered wood floors, dual pane windows, cam lighting, large patio yard and open floor plan.
——————————————————————————————————————————————-
Proprietary IHB commentary and analysis 
Resale Home Price …… $465,000
House Purchase Price … $265,000
House Purchase Date …. 5/12/2000
Net Gain (Loss) ………. $172,100
Percent Change ………. 64.9%
Annual Appreciation … 4.9%
Cost of Home Ownership
————————————————-
$465,000 ………. Asking Price
$16,275 ………. 3.5% Down FHA Financing
4.18% …………… Mortgage Interest Rate
$448,725 ………. 30-Year Mortgage
$142,917 ………. Income Requirement
$2,189 ………. Monthly Mortgage Payment
$403 ………. Property Tax (@1.04%)
$0 ………. Special Taxes and Levies (Mello Roos)
$97 ………. Homeowners Insurance (@ 0.25%)
$516 ………. Private Mortgage Insurance
$487 ………. Homeowners Association Fees
============================================
$3,692 ………. Monthly Cash Outlays
-$492 ………. Tax Savings (% of Interest and Property Tax)
-$626 ………. Equity Hidden in Payment (Amortization)
$24 ………. Lost Income to Down Payment (net of taxes)
$78 ………. Maintenance and Replacement Reserves
============================================
$2,677 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$4,650 ………. Furnishing and Move In @1%
$4,650 ………. Closing Costs @1%
$4,487 ………… Interest Points @1% of Loan
$16,275 ………. Down Payment
============================================
$30,062 ………. Total Cash Costs
$41,000 ………… Emergency Cash Reserves
============================================
$71,062 ………. Total Savings Needed
——————————————————————————————————————————————————-
Even if mortgage interest rates are artificially forced lower, where is the corresponding wage growth in O.C to support *any* kind of price increase?
If they ever start giving out Academy Awards for YOY bullshit artistry, the California Association of Realtors and “economist” Leslie Appleton-Young would be nominated in all 10 categories.
NAR, is now a new age movement channeling “hope”, but as usual, there is no change.
I need to make a NAR sign for my next Occupy march right here in Irvine, see you there Saturday 🙂
Thank You NAR
“Bought in 2004 with 20% down, still underwater, banks got bailed out, I got sold-out”
You were sold-out? How much responsibility did you have in your decision to purchase in 2004 with 20% down?
I call BS! People who put money down – especially 20 percent are our allies not enemies.
Bad decision for sure but, these are the ONLY people that deserve a break!
BD
I don’t think it was a bad decision. How in world could I possible judge someone else’s decision to buy or no buy a home? We bought a home recently and I could care less what anybody else thinks. I was just curious that if Swiller thought that he was “sold out” into buying his home, how much, if any, responsibility did he have in his decision?
I know the market value of the home we just purchased will decrease, and I fail to see how any of the “it’s a good time to buy” morons have any responsibility in my decision. And we put 100% down.
Awgee, the system has been prepetrated by fraud. How in God’s green earth you can even come here to this site and not understand that, I fail to comprehend.
Aye, I already know your judgmental, haughty attitude so I do not expect any compassion OR understanding from your type, after all, I’m a scumbag according to your words.
I got f#$#%# by a system of fraud. Yes, I made the decision, yes I was suckered into it, which makes ME a sucker. Yes, I’m a tool for allowing it to happen, but it doesn’t change the fact the banks got bailed out, and I got financially sodomized.
It’s ok though, I own no credit cards, nor will. I also do not use banks, and use my credit union. In addition, I use CASH, so the financial basta#ds do not make money for nothing on an electronic transaction. Oh, in addition I cancelled my cable TV and cell phone. When I get raped I will fight back, and this fight will now last for life. F U banksters.
Funny 2% protest sign
http://totalbuzz.ocregister.com/2011/10/24/richest-1-get-poorer-sort-of/70413/2-percent/
Calling a bottom is equivalent to saying that prices will go up soon, usually with only faith as evidence.
I’m hoping my market stays pretty flat, but there is no reason for me to expect appreciation. You can get new models similar to my home for about what I paid. You can also find homes in construction where you can pick your finishes. My home will not command a premium over the new homes, and the prices those new homes command will set the market for mine.
You guys remember the infamous “ALT A TSUNAMI/reset” chart?
http://mortgage.ocregister.com/2009/05/20/loan-reset-threat-looms-through-2012/10791/
The theory of early 2009 was that nothing could be done to stop it, and by the time that wave peaked in late 2011, we bears would be swimming in inventory at firesale prices.
Ahh memories…
The bears were right too. Most of the people in the reset chart have defaulted, and they now squat in shadow inventory. The only thing the bears got wrong is what the banks would do with the inventory. Few anticipated banks would allow widespread squatting. I didn’t.
“The only thing the bears got wrong is what the banks would do with the inventory. Few anticipated banks would allow widespread squatting. I didn’t.”
Actually, there were quite a few who saw that once MTM was suspended and anticipated that the whole “2nd wave” wouldnt materialize as such. After that was the case, I always wondered why the bears continued to insist it would still be a huge 2nd wave tsunami hitting in late 2011. Dr. Housing bubble still cant bring himself to admit this…
Most of the comments I read that stated the ARM resets would not be a big deal were focusing on the low interest rate environment. If people face resets during a time of low interest rates, it merely kicks the can down the road. It’s the recast to a fully amortized payment that is the real problem.
I don’t recall anyone making the argument that mark-to-fantasy would allow the banks to create shadow inventory from the reset/recast people. That’s not to say nobody made that argument, but as someone who focuses on this issue every day, I didn’t come across this argument myself which leads me to believe it wasn’t a widely held opinion.
Of course, the banks have created a huge shadow inventory, and the wave is being held back and metered out over time. With that level of overhead supply, it’s hard to see how prices could go higher.
I don’t recall anyone making the argument that mark-to-fantasy would allow the banks to create shadow inventory from the reset/recast people. That’s not to say nobody made that argument, but as someone who focuses on this issue every day, I didn’t come across this argument myself which leads me to believe it wasn’t a widely held opinion.
I dont recall the name I was using then, but I stated that here, on Dr. H, JTR, Westside meltdown, chuck ponzi’s site, etc. At the time, my minority opinion was shouted down by the masses, accusing me of being a knifecatcher, realtard ™, and various other sundry labels, so perhaps thats why you dont recall it.
“Of course, the banks have created a huge shadow inventory, and the wave is being held back and metered out over time. With that level of overhead supply, it’s hard to see how prices could go higher.”
Agree. Ironically, this admission of yours a mere 2 years ago would have been met with the same sort of disdain, contempt, etc. that disagreed with the early 2009 consensus that “housing prices are going to crash back to oblivion” levels in the very near term.
Also, I dont think you did this here, but I do recall other sites simply deleting my posts…and when I asked why, I was told my thought was “nothing but bullish spin”. Man, the myopia of the day was astounding.
Back in 2009, we all came to the consensus that real estate would not go up, and at best stay flat to declining slowly for years to come. So 2009, not a good time to buy because of all the downside risk with no chance of going higher.
Now it’s almost 2012, and I still think real estate won’t go up…and will stay flat to declining in the years to come.
I was not shouted down..dunno what ur talking about.
“I still keep a toe in the water of the land development industry, and many developers are starting to prepare to deliver product again. Many of these developers are anticipating a resurgent new home market… in 2015” Resurgent? Really? Developers have always been and will always be “criminally optomistic” 6-7 years of gloom for 3 years of sunshine. Right now land purchase prices will force them to deliver product that is still priced too high for folks to be able to afford.
“Right now land purchase prices will force them to deliver product that is still priced too high for folks to be able to afford.”
Yes, that is a big problem. The volume of raw land transactions is still very low because the demand is mostly long-term land bank type transactions. I just had lunch with a developer a couple of weeks ago who has spent about $40M of his $100M available capital, but he hasn’t bought anything since last October because the asking prices still don’t make sense. He is also the one who relayed to me that since so little work has been done on long-term entitlement projects over the last few years, there could easily be a shortage of finished lots in Riverside County in 2015. Depends on sales, of course.
“The local economy is doing somewhat better than elsewhere in the state and this should carry into next year, and the share of distressed sales is among the lowest in the state at 32% in July compared to 35% a year earlier, so county home sales should improve by a bigger margin than the 1% gain for the state.”
Nearly one third of all homes sales in OC are distressed, but somehow these clowns spin that into something positive. These guys are no better than heroin dealers, buy my drugs they won’t hurt you…I promise!
Regarding the point of “Cooler heads do prevail,” you should be aware that Congress is preparing to re-increase the FHA conforming loan limit:
http://www.housingwire.com/tag/conforming-loan-limit
Although it has not passed yet, there is a good chance it could due to political desire to “help homeowners” – if you think we should continue to let markets deflate please write your congressman to ask them to not increase the FHA loan limits. In particular, our Irvine Rep. John Campbell (R-Calif.) has introduced his own bill to restore the FHA increased limits.
Oh the irony – areas that need the most help in allowing prices to return to affordable levels have legislators who want to help inflate prices.
Prices will stabilize in Irvine because the state AGs’ settlement with the banks is going to result in widespread rate reductions for qualified underwater borrowers thereby slowing the strategic default rate – at least that’s what I’m hoping for…
The key to this as viable is “qualified underwater borrowers”….the program as I’ve read about requires that you be current on your mortgage and all other debts. Properties don’t become ‘distressed’ until payments are delinquent. All the interference by government is only making the situation worse. If TARP could have “taken care of the toxic mortgages”, it would have. But that was not possible.
I think you’re referring to the revised HARP that allows qualified borrowers in Fannie/Freddie loans to refinance regardless of LTV. That will “help” (i.e. prevent) a lot of prospective strategic defaulters. However, the conforming loan limit was lower before the Recession. We bought in 2007 when it was ~$417K in Irvine and therefore aren’t eligible.
I’m referring to the state AGs who have been negotiating with the big banks/servicers over many issues. It’s being reported that part of the settlement will require banks to reduce the rates (not refinance) on mortgages they own. Most mortgages were securitized, but many seconds (purchase, refis, and HELOCs) were not and are owned by the big banks.
I’d even accept a rate reduction and give my bank an accelerated payment schedule. e.g. “Reduce my rate to 4% and in exchange I’ll double my payment.” BoA declined this offer a year ago, but times are changing…
Strategic defaults won’t slow until there is some level of appreciation. Not likely anytime soon. If you owned 100 shares of Netflix today, what would you do?
Fair point, but not a fair analogy. I can dump my Netflix shares and deduct the loss – my life doesn’t change. I can dump (stop paying) my mortgage – my credit will be shot and I’ll have to move as quickly as six months.
I don’t need appreciation to discourage me from strategic default. If I received a “small” concession like my rate being reduced to 4-5%, I can reasonably say I would not strategically default (barring another 25%+ drop in value).
(A rate reduction would be a pretty big loss for the owner(s) of my mortgage, but relative to their risk right now, it would be a small concession.)
The point was….there has been a paradeim change in the way and reasons why folks buy homes. Their attitude, fostered over the last 35 years I have been involved in the business, is that “real estate always goes up”, and you will always make money investing in a house. The part that got lost in the cocktail party conversations about “how much is your house worth this week?”, is that all real estate is a long-term investment. The stock market, commodities market are for short term and speculation. Neighborhoods grow communities and need stability. In 1980-82 I was selling homes to folks who camped out in the parking lot of the sales office to buy there at 14% interest. What would that do to today’s market?
Dr. Housing Bubble reported that the Senate has approved reinstatement of the higher conforming FHA loan limits for high cost areas.
I haven’t seen any reporting of this in the MSM, but did find it reported on a congressional website. I hope I’m missing something, but this and the proposed sale of residency to foreign buyers of property at 500k and up is starting to mkae me feel a little sick.
WTF.
http://www.doctorhousingbubble.com/trifecta-of-keeping-the-housing-bubble-inflated-in-pocket-markets-–senate-votes-to-reinstate-big-loan-limits-pushes-visas-for-wealthy-foreign-home-buyers-and-artificially-slams-rates-lower-t/
http://bradsherman.house.gov/2011/10/congressmen-miller-and-sherman-praise-bi-partisan-senate-approval-of-higher-conforming-loan-limits.shtml
Senate approved the amendment of HR 2112, which is a procedural event and is a proposal to change the law. Both houses still need to pass the bill which the president may or may not sign into law.
However, such events can gain momentum and be egged-on by lobbyist until it becomes law.
Similarly, the foreign $500k proposal is only a bill that was recently introduced by Sens. Mike Lee, R-Utah, and Charles Schumer, D-N.Y. – thus if you disagree with such proposals, you should write your congressmen.
I always *used* to say “It doesn’t matter how good or bad things are they will never stay that way”
I don’t say that any more.
But let’s be honest, can anyone foresee anything that is going to happen within the foreseeable future that could even prop up property price in the OC, never mind cause them to start to rise?
I work for a large manufacturing company in Irvine, I work on the front line and I can tell you the future is looking more and more dismal every Day… we haven’t had anything but bad news, furloughs for some and cost cutting measures for the last six months.
The NAR don’t live in the real world so how would they even know?
NAR must live in the real world: How can they not see the decline in dues and membership? How can they not know that many former Realtor® have moved up into higher callings such as armed robbery, and extortion, with some even working as methamphetamine-compensated sexual service providers?
IR,
an update on one of your older posts: “Gatsby’s Egg”
https://www.irvinehousingblog.com/blog/comments/19001-antioch-irvine-ca-92603-turtle-rock/
this house was recently sold for $982,500. It was originally listed for $1,258,000 in Dec. 2009.
Thanks. That’s a great find. So much for their $300,000 in improvements adding value.
Realtor in Turtle Rock told me most people are looking for tear downs. Advice was to not do any improvements whatsoever.
It’s a 1969 house, so would need a lot of upgrades for a $1 million ask.
Note that it has a real lot: 8,900 square feet.
I agree with Duran’s comment above.
The NAR really needs to pick up the phoen and talk to prospective clients more. They seem out of touch with these conclusions (and instructions). Of course, recommending caution and waiting to buy is not something in the NAR marcom repetoire. If they’re not instigating a call to urgency, then it’s considered a failure of the NAR marketing and economics team.
Even for those working in local companies and industries in OC where things are doing relatively or surprisingly well in 2011, most of those same businesses already have or still are slashing expenses, delaying important capital investments in equipment, and/or cutting workforce. In my work I sense that companies are becoming extremely caution/bearish as 2012 nears.
The main area where spending on capital investments has increases noticeably is for government related projects. But, uh…I guess we all know who ends up paying for that…
One of the fortune 500 companies in the Irvine area is doing really well…and they just fired 5% of their work force…U know gotta pay the shareholders….
But really companies aren’t there to give people jobs..they are there to make money..so I ain’t mad atchoo.
$487/mo HOA fees?!
The condo listing says HoA fee #1 is $395 and HoA fee #2 is $82, totalling $477/month.
Note the view is peek-a-boo: ie, if you rent a cherry picker, you should be able to see some waves in the distance. 😉