See the curtains hanging in the window

In the evening on a Friday night

A little light a-shining through the window

Lets me know every thing’s all right

Summer breeze, makes me feel fine

Blowing through the jasmine in my mind

Summer breeze, makes me feel fine

Blowing through the jasmine in my mind

Summer Breeze — Seals and Crofts

Link to Live Performance Video

Link to Studio Version

This property was previously featured in June: Woodbridge Knife-Catchers.

A reader has been watching this property and has emailed me with some juicy details I want to share with you today.

Old Asking Price: $599,900

New Asking Price: $549,000

Purchase Price: $490,100

Purchase Date: 4/30/2007

Address: 17 Seawind, Irvine, CA 92604

Beds: 2

Baths: 2

Sq. Ft.: 1,058

Year Built: 1984

Stories: 1

Type: Condominium

County: Orange

Neighborhood: Woodbridge

$/Sq. Ft.: $519

MLS#: P594916

Status: Active on market

On Redfin: 15 days

From Redfin, “Beautifully upgraded home in Woodbridge near the lake. Highly upgraded with hardwood floor thru entire house, tile floor in the bathroom, granite counter top, crown & base moulding, just painted, private spa in the backyard. Walk to lake, park, and lots lots more!!”

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This unit does not see the lake, it isn’t on a park, it doesn’t even have a yard, it is a nondescript, tiny tract home in the middle of Woodbridge — for sale in a declining market. WTF?

Well, this unit was purchased by a realtor. Perhaps business is slow this year? Not long after she put this unit on the market for $599,900, a comparable property at 29 Whitecloud came on the market for $599,000. This unit is 30% larger than 17 Seawind, and it is overpriced as well. Not daunted by the competition, our kool aid addicted realtor actually raised her price to $605,000. WTF?

When both properties languished on the market, the owner of 29 Whitehead lowered their price to the current $569,000. So how does our realtor/flipper/knife-catcher respond? She raises the price to $610,000. WTF?

Well, as you might imagine, neither property sold and they were pulled from the market in order to reset the “days on market” number. Now they are both back for sale, and they are both still overpriced.

At least this realtor has something to do. She can sit in her homedebtor’s prison each weekend running an open house. Perhaps she finds some leads on some other overpriced stucco boxes she can fail to sell?

Originally posted March 22, 2007.

He’s back. The same house; the same price. Still no chance…

Asking Price: $2,299,500

Purchase Price: $2,050,000
Purchase Date: 5/23/2006

Address: 29 Mahogany Drive, Irvine, CA 92620

Beds: 7
Baths: 6.5
Sq. Ft.*: 4,200
Lot Sq. Ft.*: 12,000
Year Built: 1996
Stories: 2
Neighborhood: Northwood
$/Sq. Ft.*: $548
MLS: S478955
Status: Active on market
On Redfin: 6 days

Redfin, Zillow

Does anybody remember the TV show about the dolphin Flipper? In the world of sea mammals, whales are bigger than dolphins, and in the parlance of Las Vegas, Whales are the biggest of the high rollers. The flipper of this property is a whale. Who else would try to flip a $2,050,000 property? Assuming a 6% sales commission, if he gets his $2,299,500 asking price, he will make a profit of $111,530. Not bad for simply owing real estate for 10 months. Isn’t 15% “in the bag?” This guy isn’t greedy, he is only looking for 10% or about 1% a month. Unfortunately, the market seems to have moved the other direction at about the same speed.

{adsense}

Our whale may have some difficulty with this one. He bought right at the peak, and Zillow thinks his property is only worth $1,756,674. Not good if you are trying to convince someone you need to get $550,000 more than that. What does Zillow know anyway? Tract homes in Irvine should be going for over $2,000,000. It’s the new paradigm.

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They call him Flipper, Flipper, faster than lightning,
No-one you see, is smarter than he,
And we know Flipper, lives in a world full of wonder,
Flying there-under, under the sea!

This price was just lowered to $255,000. This is becoming a deep 2004 rollback. Ouch.

Well, me and my friends-we all love to see
Comedy classics on late night TV
Those knuckleheads always get in a scuffle
A push and a shove doin’ the Curly Shuffle

The Curly Shuffle – Jump In The Saddle

Link to Video of Curly Shuffle

Do you remember the Curly Shuffle, the sliding back-step predating the moonwalk? Isn’t that how our housing market works: Two steps forward and one step back?

We had our big rally, our two steps forward. Now it is time for the one step back (or two or three…)

Today’s featured property is another distressed low-end unit: a 2004 rollback.

Asking Price: $265,000

Purchase Price: $273,000

Purchase Date: 7/7/2004

Address: 508 Orange Blossom, Irvine, CA 92618

1st Loan $218,400
Downpayment $54,600

Beds: 1
Baths: 1
Sq. Ft.: 512
$/Sq. Ft.: $518
Lot Size: 512 sq. ft.
Year Built: 1977
Stories: 1
Type: Condominium
View: Water
County: Orange
Neighborhood: Orangetree
MLS#: S497083
Status: Active
On Redfin: 24 days

From Redfin, “Best priced condo in the Lake Condos! Beautiful End Unit with private Wood Deck overlooking Stream!Price includes Washer/Dryer and Refrigerator!Amenities include Assoc. Pool, Spa, Tennis Courts, Clubhouse with Workout Room and Barbecue poolside!Enjoy the absolute Best of OC with nearby shopping, entertainment, World Class Restaurants and Oak Creek Golf Course! The Irvine Spectrum is just minutes away with close access to freeway, hospital and college!Don’t miss out on this investment opportunity!!”

Notice this is being touted as an “investment opportunity.” I guess if flippers are the only ones buying, you need to appeal to them, right?

At over $100 a round, I doubt the resident here will be playing Oak Creek Golf Course very much.

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If this seller gets their asking price, they stand to lose $23,900 on a mid 2004 purchase.

The bottom of the market is being destroyed. What more is there to say? Well, wait until you see tomorrows post…

When me and my friends go out on the town
We can’t sit still. We can’t sit down
We don’t like to fight and we don’t like to scuffle
Dancin’ all night doin’ the Curly Shuffle

Hey, Moe. Hey, Moe.
Well, a nyuk-nyuk-nyuk-nyuk.
La-le-li-li
woo-woo-woo-woo
Well, we never miss a chance
We get up and dance and do the Curly Shuffle

Tell me what’s wrong with society

When everywhere I look I see

Young girls dying to be on TV

They wont stop ’til they’ve reached their dreams

Diet pills, surgery

Photoshop pictures in magazines

Telling them how they should be

It doesn’t make sense to me

Is everybody going crazy?

Is anybody gonna save me?

Can anybody tell me what’s going on?

Tell me what’s going on

If you open your eyes

You’ll see that something is wrong

Crazy — Simple Plan

Link to Music Video

When we start to look at property pricing through the post-bubble-burst lens, you see just how crazy these prices are. This property is going to require an income of somewhere between $150,000 and $200,000. If you make that kind of money, is this the place you were envisioning as your dream home?

Asking Price: $600,000

Purchase Price: $650,000

Purchase Date: 2/5/2007

Address: 3 Acorn #85, Irvine, CA 92604

1st Loan $520,000

2nd Mtg. $125,000

Downpayment $5,000

Beds: 3

Baths: 2.5

Sq. Ft.: 1,448

$/Sq. Ft.: $414

Lot Size: 3,000 sq. ft.

Type: Condominium

Style: Contemporary/Modern

Year Built: 1979

Stories: Two Levels

Area: Woodbridge

County: Orange

MLS#: S497736

Status: Active

On Redfin: 37 days

From Redfin, “Great looking condo, new gas stove and microwave, new kitchen cabinets and new title. Very clean and ready to move in!”

Short but sweet.

Is that the front door, or is that an exterior broom closet?

The white tile kitchen is very stylish, or at least it was in 1985.

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This is going to be a short sale, and I wouldn’t be surprised to find the “owner,” and I use that term loosely, has not made many, if any, mortgage payments. If the place is empty now, how likely is it than anyone ever lived there? If there was no owner occupant and no tenant, and the owner has two loans for $645,000, that is a major negative cashflow. Do you think he reliably made all the payments? Do you think he feels any particular obligation to pay the bank for the short sale? I am not holding my breath…

If this seller gets his asking price, and if the bank approves the sale, the owner stands to lose his $5,000 downpayment — big deal. The bank stands to lose $81,000. It is any wonder we are experiencing a credit crunch?

Here comes the sun, here comes the sun,

and I say it’s all right

Little darling, it’s been a long cold lonely winter

Little darling, it feels like years since it’s been here

Here comes the sun, here comes the sun

and I say it’s all right

Here Comes the Sun — The Beatles

Link to Music Video

I love that song. When I hear it it brings me back to the feelings of peace and tranquility I would feel on a spring morning overlooking a Northwoods lake…

WAKE UP!

The bear market is over! Rapid house price appreciation has returned! The winter is over, a new day is dawning, and everything is all right.

NOT.

Well, you would think all was well by the asking prices of today’s WTF trio. The mentality of the herd was evident during the house price rally. No price was too high because someone would always pay more. Making a million dollars on the sale of your home was not a dream, it was an entitlement.

The market is thinning the herd a bit, but there are still pockets of bullishness that display such a callous disregard for reality that one has to ask, “WTF?” Today’s grouping of three neighboring houses is one such display.

Rosegate Estates is a sub-neighborhood in Northwood Pointe which of course is a sub-neighborhood in the Village of Northwood. (When you are as elite as these people, you need to separate yourself from the riff-raff.) These homes are beautiful, and this neighborhood is very desirable. Is it $2,000,000 desirable? You decide…

Asking Price: $1,999,800

Purchase Price: $1,075,000

Purchase Date: 4/25/2002

Address: 1 New Dawn, Irvine, CA 92620

Beds: 5

Baths: 4.5

Sq. Ft.: 4,200

$/Sq. Ft.: $476

Lot Size: 9,500 sq. ft.

Year Built: 1998

Stories: 2

Type: Single Family Residence

Neighborhood: Northwood

MLS#: S491641

Status: Active

On Redfin: 73 days

From Redfin, “Stunning Rosegate Estate featuring 5BD/4.5BA, 3-Car Garage, Home Offic e, Butler’s Pantry, Custom Library & Pebbletech Pool & Spa Plus Built-in BBQ! Beautifully appointed with Dramatic Cathedral Ceilings, Custom Tile Floors, Designer Carpet, Custom Blt-Ins, Integrated Speaker System & Home Security System! Gourmet Kitchen w/ Solid GRANITE COUNTERTOPS & Center Island * Blt-In Refrigerator * Viking 6 Burner Cooktop * Blt-In Desk & Walk-In Pantry!

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They knocked $200 off of $2,000,000. Quite a marketing expense. I suppose they could have asked $1,999,999.99.

So this property has doubled in value since early 2002? I guess all the rollbacks we have been seeing didn’t impact the high end, right?

Asking Price: $1,999,900

Purchase Price: $642,000

Purchase Date: 1/13/1998

Address: 23 New Dawn, Irvine, CA 92620

Beds: 5

Baths: 5.5

Sq. Ft.: 5,045

$/Sq. Ft.: $396

Lot Size: 8,000 sq. ft.

Year Built: 1998

Stories: 2

Type: Single Family Residence

Neighborhood: Northwood

MLS#: S489401

Status: Active

On Redfin: 92 days

Unsold in 90+ days

From Redfin, “Rosegate in Prestigious Northwood Pointe. Desirable plan w/ dramatic curb appeal. Living room w/ vaulted ceilings, separate dining, one bedroom down + office. Gourmet kitchen open to family room. Master suite w/ retreat, master bath highly upgraded. Three secondary bedrooms upstairs + oversized bonus with bath perfect for private suite. Four car garages, tasteful upgrades, private yard and much more. Steps to schools, parks, pool, and minutes from shopping and freeways. Opportunity knocks!”

Opportunity knocks? For what, to be a greater fool or a bagholder? I will pass. Oh, wait, It has a gourmet kitchen. Where could I find another one of those in Irvine?

I wonder if the neighbor at 1 New Dawn used this property as a comparable for pricing. Notice the price is $100 lower? I guess neither one wants to give it away…

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This owner only wants to triple their money for 9 years of ownership. That makes sense. Houses should triple in value every nine years, after all wages did — oops, maybe not. Perhaps I will buy it and sell it for $6,000,000 in 2016. A $4,000,000 profit could fund my retirement.

As always, I have saved the best for last…

Asking Price: $2,400,000

Purchase Price: $1,150,000

Purchase Date: 1/10/2003

Address: 46 New Dawn, Irvine, CA 92620

Beds: 5

Baths: 4.5

Sq. Ft.: 4,600

$/Sq. Ft.: $522

Lot Size: 10,000 sq. ft.

Year Built: 1998

Stories: 2

Type: Single Family Residence

View: Trees/Woods

Neighborhood: Northwood

MLS#: P587715

Status: Active

On Redfin: 47 days

From Redfin, “Magnificent home in elegant Rosegate Estate with beautiful architectur e featuring 5beds+home office & custom library, 4 car garage, and more! Soaring ceiling, wrought iron staircase, lime stone flooring & custom built-ins throughout the house give it a dramatic personality. gourmet kitchen with granite counter tops & center island over looks beautifully land scaped back & side court yard. Come and Show this stunning beauty of this home!”

Found another gourmet kitchen…

Do you think that justifies the $400,000 higher price?

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So this house has more than doubled in price since 2003?

So are these WTF prices? Can you create a reasonable set of circumstances which justifies these prices? I can’t. I am completely dumfounded. The only conclusion I can reach is that all of these owners are participating in a massive greed off:

How high can we set our prices without embarrassing ourselves? Wait, we have no shame, how high can we set these prices — period. Maybe if all three of us set our prices this high somehow it won’t be as ridiculous?

I am still wondering if 23 New Dawn is angry with 1 New Dawn for undercutting their asking price by $100? After all, this is a race to the top, not a race to the bottom…