Author Archives: zovall

Buy or rent at Monticello in Northpark Square

28 Taquitz is a 3bd/3ba 1,826 sq. ft. attached condo in the Monticello tract in Northpark Square. Monticello is located across from Beckman High and is bounded by Bryan, Rubicon, Rosenblum, and Montellena. The streets inside Monticello are: Taquitz, Leucadia, Cosentino, Cabazon, and Idyllwild.

Monticella has 4 main floorplans:

Plan 1 – 2 Bed / 2 Bath 1211-1289 square feet

Plan 2 – 2 Bed / 2 Bath 1398 square feet

Plan 3 – 2 Bed / 2 Bath 1471-1663 square feet

Plan 4 – 3 Bed / 3 Bath 1826 square feet

28 Taquitz is a Plan 4 and is listed at $499,000

There is one other Plan 4 that is active and that is 27 Leucadia which is listed at $509,900.

And there is one Plan 4 that is Pending Sale: 9 Cabazon which is a short sale listed at $425,000.

A quick search revealed 3 Plan 4's sold in the last year:

10/20/2011 9 Leucadia $430,000
9/16/2011 10 Taquitz $470,000
6/27/2011 28 Taquitz $481,000

Yes, 28 Taquitz was purchased just about 6 or so months ago. It looks like it was bought for cash and the agent is the owner – not sure why they are selling now.

Seems like the sales prices have a pretty wide range. I'll use an average of the closed and pending sales for the analysis – $451,500

Here's what the numbers might look like if purchased by someone with excellent credit and 20% down:

Purchase Price $451,500
Closing costs $13,545 3%
Total price $465,045
Down payment $103,845 20%
Loan Amount / Percentage Of Price $361,200 80%
Interest Rate / Period (months) 4.00% 360
Monthly Yearly
Mortgage Payment $1,724 $20,693
Interest Component $1,204 $14,448
Property Tax $399 $4,784 1.06%
Special Assessments $107 $1,285 0.28%
Effective Tax rate 1.34%
Insurance $50 $600
HOA 1 $227 $2,724
HOA 2 $74 $888
Cash Out $2,581 $30,973

There are some possible adjustments that may apply to your situation. Be sure to also consider how long you may own the property (average is around 6 years), what kind of financing you actually qualify for, how much you put down, the effect of giving up the standard deduction, potential price declines, costs to sell the property, etc. The NY Times Buy or Rent calculator is a great tool that helps with some of these.

Possible Adjustments
Interest paid $14,448
Property tax $4,784
Total deductible $19,232
Tax benefit $401 $4,808 25%
Opportunity cost of down payment -$173 -$2,077 2%
Principal paid in mortgage payment $520 -$6,245

So, what do these Plan 4s rent for? I didn't find much in terms of closed leases but 43 Leucadia is listed at $2550/month.

Based on this info, would you buy 28 Taquitz for $451k or rent it for $2550/month? If you wouldn't buy it fo $451k, what price would you pay for it?

Closed Sales from 1/5/2012 to 1/11/2012

Based on feedback from last week, it sounded like this was a helpful post so I'll continue. The sales listed here are those that have closed in the 7 days between 1/5/2012 and 1/11/2012.

Date Sold Address ZipCode Tract Sold Price Beds SqFt
Airport Area
1/9/12 3030 Scholarship 92612 3000 The Plaza $905,000 2 1925
1/10/12 2223 Scholarship 92612 Avenue One $330,000 2 1037
El Camino Real
1/11/12 4391 Vale St 92604 Greentree $540,000 3 1515
Northpark
1/5/12 2 Healdsbury 92602 Manchester $1,190,000 4 3400
1/9/12 18 Leucadia 92602 Monticello $375,000 2 1400
Northwood
1/5/12 9 Trailwood 92620 Cristal $1,139,999 5 3582
1/6/12 939 Somerville 92620 Northwood Villas $527,500 3 1610
1/7/12 28 Grape Arbor 92620 Camellia $775,000 4 2315
Oak Creek
1/5/12 9 Hawk 92618 Ashford Place $850,000 4 2750
Orangetree
1/10/12 2312 Apricot Dr 92618 Terrace $228,500 2 910
Portola Springs
1/9/12 59 Bell Chime 92618 Decada $485,500 3 1545
Quail Hill
1/6/12 32 Paperwhite 92603 Solstice $540,000 3 1509
Rancho San Joaquin
1/10/12 1 Solana #22 92612 $410,199 3 886
University Park
1/5/12 30 Rockrose Way 92612 $420,000 4 2130
Westpark
1/6/12 4 Lorenzo 92614 Sorrento $845,000 4 2580
Woodbridge
1/11/12 109 Fallingstar 92614 Laurels $210,000 1 860
1/11/12 64 Eagle Pt 92604 $189,000 2 954
Woodbury
1/5/12 75 Sanctuary 92620 Cachette $470,000 3 1580
1/10/12 28 Vintage 92620 Lombard Court $420,000 2 1526

Do any of these sales look interesting? Were you considering any of these properties?

One sale that stood out to me is 75 Sanctuary. I am really surprised by the closing price of $470k. When it came onto the market, it was listed at $500k as a Short Sale and went Pending pretty immediately. At that price, I would have expected multiple offers and for it to be bid up. $470k is the lowest I've seen for a Cachette Plan 1.

Buy or rent at Cobblestone in Oak Creek

30 Danbury Lane is a 3bd/2.5ba 1,357 sq. ft. detached condo in the Cobblestone tract in the village of Oak Creek. Cobblestone is located at the corner of Jeffrey and Alton. There is one main street that forms a loop inside the tract and depending on where the home is in the loop, the street could be named Danbury, Cherrybrook, or Lantern Lane.

Cobblestone has 3 main floorplans:

  • Plan 1 – 2 Bed / 2.5 Bath 1127 square feet

  • Plan 2 – 3 Bed / 2.5 Bath 1340-1357 square feet

  • Plan 3 – 3 Bed / 2.5 Bath 1490 square feet

30 Danbury is a Plan 2. I did a quick search and the only Plan 2 sale I was able to find in the last year was 68 Danbury which closed on 11/17/2011 for $475,000. A Plan 3, 110 Danbury, closed at $492k on 12/27/11 so I'm going to use $475k as the purchase price for the analysis.

Here's what the numbers might look like if purchased by someone with excellent credit and 20% down:

Purchase Price $475,000
Closing costs $14,250 3%
Total price $489,250
Down payment $109,250 20%
Loan Amount / Percentage Of Price $380,000 80%
Interest Rate / Period (months) 4.00% 360
Monthly Yearly
Mortgage Payment $1,814 $21,770
Interest Component $1,267 $15,200
Property Tax $409 $4,911 1.03%
Special Assessments $158 $1,896 0.40%
Effective Tax rate 1.43%
Insurance $50 $600
HOA 1 $60 $720
HOA 2 $79 $948
Cash Out $2,570 $30,844

From the last buy/rent post, a few people commented and emailed on the adjustments I listed and that some, like the tax deduction, might not be accurate because you need to account for the standard deduction. And that others, like paying down principal, would be more than negated if the property goes down in value (like it has over the past several years). Also, when considering whether to buy/rent, it is important to take into account the costs to sell the property. Many people do not live in or own their homes for more than 10 years. Does anyone have statistics on what the average is? In any case, I can't imagine someone living in one of these detached condos for 30 years. But on the flip side, I could see someone living here and then moving to a larger home and renting this one out. Although these adjustments may not apply to everyone or in all cases, I think there is still value in looking at what they are. When I get some more time, I'd like to see what impact they would have on my situation.

Possible Adjustments

Interest paid $15,200
Property tax $4,911
Total deductible $20,111
Tax benefit $419 $5,028 25%
Opportunity cost of down payment -$182 -$2,185 2%
Principal paid in mortgage payment $548 -$6,570

One of our readers wrote in and suggested to add a Repairs expense for purchasing. Any other ideas on what else to include/exclude?

As far as what these Plan 2s rent for, 68 Danbury, the sales comp from November seems to have been purchased by an investor (looks like an all cash purchase from what I can tell) and it was listed as a rental 2 weeks after being bought. The asking rent is $2650/month. Another Plan 2 rental came on the market just 6 days ago and is also asking $2650/month: 214 Lantern.

The closed Plan 2 leases are 178 Cherrybrook for $2550/month on 9/18/2011 and 165 Cherrybrook for $2550/month on 8/27/2011.

Based on this info, would you buy 30 Danbury for $475k or rent it for $2550/month?

Closed Sales from 12/29/2011 to 1/4/2012

Today, I'd like to post a list of all closed sales in Irvine from 12/29/2011 to 1/4/2012. As a kid, I remember reading the newspaper to see what homes in town sold recently – yes, I've been interested in RE for far too long. Over the past few years, I've seen some sites that have posted weekly sales and I think I recall Erika Chavez's blog at the OC Register also doing so a while back. When reading these lists of addresses and prices of sold homes, I'm always wondering what neighborhood the home belongs to or how many bedrooms it has or how many square feet it has. All the data is out there but it is a challenge presenting it in a helpful way. I have some grand ideas on how I want to address that in the future.

But for now, I've compiled the list with a few columns I find helpful. The list is ordered by Area (MLS term that kinda sorta is like a village but not really) and then by the Date Sold. I've tried to clean up some data such as incorrect tract or area names. Redfin offers an awesome feature where they let you view the listing information for homes that have sold – most other sites do not provide this. So, I've added Redfin links to the sold properties so you can easily get even more detailed data on one of these sold homes. Instead of reading 123 Main St sold for $450,000 on 12/12/2011, you'll get a few columns of more info and a link to the actual listing on Redfin. Hope you think it is helpful – it sure was tedious! 😉

Date Sold Address Zip Code Tract Sold Price Beds SqFt
Airport Area
1/3/12 1420 Scholarship 92612 Avenue One $324,900 2 1213
1/3/12 3224 Watermarke 92612 Watermarke $190,000 1 635
Northwood
12/29/11 216 Timberwood 92620 Collage $393,000 2 1270
12/29/11 28 Streamwood 92620 Irvine Springs $149,000 1 639
12/29/11 3 Abeto 92620 OTHR $695,000 5 2864
12/30/11 15 E Delamesa 92620 Park Paseo $665,000 4 2088
12/30/11 5 Clear Crk 92620 Cristal $1,600,000 6 4250
1/3/12 8 Field 92620 Shadow Run $615,000 4 1891
1/3/12 10 Mahogany Dr 92620 Mahogany $1,430,000 5 4250
Orangetree
12/29/11 100 Orchard 92618 Patio Homes $323,000 2 900
12/29/11 40 Orange Blossom 92618 Lake Condos $223,500 2 956
12/29/11 124 Tangerine 92618 Patio Homes $411,000 3 1445
Portola Springs
1/2/12 153 Pathway 92618 Primrose $549,990 3 1873
1/2/12 175 Pathway 92618 Primrose $570,000 4 2056
Quail Hill
1/4/12 116 Capeberry 92603 Chantilly $1,178,750 4 3100
Turtle Ridge
12/29/11 22 Bower Tree 92603 Arborel $651,500 3 1665
12/29/11 71 Grandview 92603 La Cima $3,995,000 5 6070
12/30/11 29 Garden Terrace 92603 Botanica $1,875,000 4 3450
Turtle Rock
12/29/11 22 Morning Glory 92603 Ridge Townhomes $835,000 2 2021
12/30/11 5 Del Rey 92612 Pointe – Turtle Rock $617,000 2 1830
1/3/12 59 N Canyon Rdg 92603 Glen Garden Homes $520,000 3 1628
University Park
12/30/11 6 Camphor 92612 Terrace $400,000 3 1400
1/3/12 17 Eucalyptus 92612 Terrace $385,000 2 1184
1/4/12 21 Eucalyptus 92612 Terrace $550,000 3 1538
West Irvine
12/29/11 44 Copper Leaf 92602 Custom $575,000 4 1900
Westpark
12/29/11 117 Alberti Aisle 92614 Tiempo $235,000 1 830
12/29/11 164 Alicante Aisle 92614 Tiempo $300,000 2 1032
12/31/11 15 Del Carlo 92606 Positano $629,900 3 1500
1/3/12 106 Alicante Aisle 92614 Tiempo $252,000 1 830
Woodbridge
12/29/11 48 Silkberry 92614 Briarglen $555,000 3 1587
12/30/11 4 Claret 92614 Chateaux $299,000 2 1146
1/4/12 43 Havenwood 92614 Parkview $399,000 3 1399
Woodbury
12/29/11 75 Nature 92620 Four Quartets $480,000 3 1706
12/29/11 61 City Stroll 92620 Esplanade $550,000 3 2074
12/29/11 86 Hedge Bloom 92618 Ivy at Woodbury East $380,000 2 1180
12/30/11 84 Sarabande 92620 Garland Park $434,125 2 1357

Several of these are new homes – any ideas which?

Are you familiar with any of these homes or neighborhoods? OC Fliptrack ring a bell?

How much have they dropped from the peak?

Would you like to see a Buy versus Rent post on one of these properties?

Is this type of post helpful or interesting? Comment away…

Buy or rent at Sage in Quail Hill

On Monday I received an email from a reader who wanted to see a comparison between the monthly cost of buying a home to that of renting the same basic home. In this post I'm going to look specifically at the Plan 3 homes in the Sage tract at Quail Hill. Sage is a detached condo tract and the Plan 3 is a 3 bedroom, 2.5 bath, 1275 square foot home with an attached 2 car garage and a small private patio. These same, basically exact detached condo floorplans are also found in other villages in Irvine and in the future I may take a look at how pricing differs for the same plan across villages. Today, we'll see what it might cost to buy and rent a Sage Plan 3.

Currently, there are two Plan 3s for sale on the market:

103 Windchime at $529,000 – Listed on 1/2/2012

68 Duet at $450,000 (Short Sale) – Listed 6/20/2011

The actual closed sales for Sage Plan 3's over the last year are:

10/10/11 18 Duet $455,000
9/29/11 62 Duet (REO) $440,000
8/25/11 44 Duet $449,000
8/17/11 201 Dewdrop (REO) $445,000
6/23/11 84 Windchime $515,000
4/19/11 54 Reunion (REO) $455,000

Based on this data, I'm going to use a sales price of $450k. Here's my take on what the cost would be if one were to purchase at $450k and put 20% down.

Purchase Price $450,000
Closing costs $13,500 3%
Total price $463,500
Down payment $103,500 20%
Loan Amount / Percentage Of Price $360,000 80%
Interest Rate / Period (months) 4.00% 360
Monthly Yearly
Mortgage Payment $1,719 $20,624
Interest Component $1,200 $14,400
Property Tax $394 $4,725 1.05%
Special Assessments $194 $2,332 0.52%
Effective Tax rate 1​.57%
Insurance $50 $600
HOA 1 $116 $1,392
HOA 2 $120 $1,440
Cash Out $2,593 $31,114
Interest paid $14,400
Property tax $4,725
Total deductible $19,125
Tax benefit $398 $4,781 25%
Opportunity cost of down payment -$173 -$2,070 2%
Principal paid in mortgage payment $519 -$6,224
Total Adjustments $745 $8,936
Cost (Cash Out – Adjustments) $1,848 $22,178

20% down payments, low interest rates, tax benefits and the amount paid towards principal all bring the cost to about $1848/month. Please let me know if you think any of the inputs are incorrect or if you think the spreadsheet is missing something. Another tool is the NY Times Buy versus Rent calculator that takes into account many other details.

So, what is the cost to rent a Plan 3? There is one available on the market right now:

50 Duet – Available for $2450/month

Also, the last Plan 3 that was leased was 84 Windchime which was leased for $2600/month on 8/19/2011. Although these are all Sage Plan 3s, each unit is different and there are factors such as the condition of the home, the quality of upgrades, the location, etc which will all affect the price/rent. Based on the cost of owning versus that of renting a Plan 3, what would you do?

Let me know if you found this post helpful and if there are any other plans/tracts/neighborhoods that you'd like me to look into.