Another home falls by the wayside
A few old cushions stuffed with pride
A hand is shaking from the rubble
This spirit is still alive
A servant bares his occupation
Breaks his back just growing old
Never mind his views were taken
Just saw by the rules of old
Less Cities More Moving People — The Fixx
Link to Music Video
Happiness and self-esteem are bi-products of self-discipline and the formation of character; character is forged from habits; habits develop through conscious repetition; conscious repetition only happens through self-discipline; self-discipline emanates from motivation and commitment; motivation and commitment comes from an understanding and appreciation of the benefits of character: happiness and self-esteem. The formula for happiness — life’s virtuous circle — is not difficult to understand, it is just difficult to implement.
Previous generations had a formula for a “normal,” happy life. You used to save your money until you had a 20% downpayment, then you bought a house, and if you had increases in income, you could move up to a nicer place. Home ownership was a symbol of success. It proved you could save to reach a goal; it proved you were responsible; it made you happy. It was also a ticket to financial security as your home equity would become a savings account you could use to fund your retirement when you downsized to smaller accommodations. These were the rules of old.
The lending industry changed all of that. They eliminated all measures of responsibility including honesty with “liar loans,” integrity with low FICO scores, and accountability with 100% financing. When homes can be purchased by people who lie, cheat and steal, the prestige of home ownership is diminished — no make that eliminated. Home ownership no longer symbolizes sacrifice and success, instead it now is synonymous with greed and gambling in the commodities market. Welcome to our Brave New World.
Enough of my sermonizing…
Today’s properties are all from the Brio community in Westpark. The village of Westpark has held up better than some of the other neighborhoods in Irvine. We have not featured many distressed properties there; however, with the continued deterioration of the low end of the market, even Westpark is showing signs of distress.
Asking Price: $469,900
Purchase Price: $473,500
Purchase Date: 2/22/2005
Address: 2204 Ladrillo Aisle #72, Irvine, CA 92606
1st Loan $378,640
2nd Mtg. $47,330
Downpayment $47,530
Beds: 2
Baths: 2
Sq. Ft.: 1,200
$/Sq. Ft.: $392
Lot Size: –
Year Built: 1994
Stories: 2
Type: Condominium
County: Orange
Neighborhood: Westpark
MLS#: S498744
Status: Active
On Redfin: 16 days
From Redfin, “Quiet & Private Corner Location. Centrally Located. Upstairs Unit. Gre at Room Open Floorplan. Highly Upgraded with Designer Wall-to Wall Carpet, Tile Kitchen Counters, White Cabinets & White Appliances, Microwave, Dishwasher & Oven Included, Wood Window Blinds, Mirrored Wardrobes, Ceiling Fans, Central Air Conditioning, Custom Interior Paint, Vaulted Ceilings, Recessed Lighting, Fireplace in the Living Room, Cozy Balcony, Rollup Garage Door and Central Fire Sprinklers.”
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This is the only seller with any skin in the game. If they get their asking price, they will lose $31,994 after a 6% commission. In all likelihood, they will lose their entire downpayment, and this might even become a short sale.
Asking Price: $386,900
Purchase Price: $319,850
Purchase Date: 7/13/2007
Address: 2301 Ladrillo Aisle #54, Irvine, CA 92606
Beds: 1
Baths: 1
Sq. Ft.: 784
$/Sq. Ft.: $493
Lot Size: –
Year Built: 1995
Stories: 1
Type: Condominium
County: Orange
Neighborhood: Westpark
MLS#: P589581
Status: Active
On Redfin: 33 days
Fixer-upper
From redfin, “HERE IS A GREAT OPPORTUNITY TO OWN IN WESTPARK, NEEDS SOME TLC BUT WORTH A LOOK, BRING INVESTORS OR FIRST TIME BUYERS, FIREPLACE, ATTACHED ONE CAR GARAGE, GOOD SIZE BEDROOM W/ WALK-IN CLOSET, DUAL SINKS.”
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This is an interesting property. The previous owner bought in 2001 for $207,500 and HELOCed himself into oblivion. On the way out the door, the previous owner trashed the place. Based on the $/SF, I would estimate Wells Fargo will be lucky to get their foreclosure price. We will see.
These next two properties were recently pulled from the market, but here is the old data…
Asking Price: $470,000
Purchase Price: $515,000
Purchase Date: 1/19/2006
Address: 2401 Ladrillo Aisle, Irvine, CA 92606
1st Loan $412,000
2nd Mtg. $103,000
Downpayment $0
Beds: 2
Baths: 2
Sq. Ft.: 1,186
$/Sq. Ft.: $396
Lot Size: –
Year Built: 1996
Stories: 1
Type: Condominium
View: Trees/Woods
County: Orange
Neighborhood: Westpark
MLS#: S483934
Status: Active
On Redfin: 115 days
Unsold in 90+ days
From Redfin, “Immaculate move in condition property located in the heart of Irvine. Spacious living room with vaulted ceilings. Granite kitchen counter with new stainless steel appliances. Private location with a two car direct access garage. Great association with pools, spa and tennis. Formal dining and living room with a cozy fireplace. Just a short walk to the Plaza vista elementary school and shopping and entertainment.”
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At over 100 days on the market, this property is clearly overpriced, but if this seller manages to get their asking price, minus a 6% commission, they (or the bank) stand to lose $73,200. In reality, they will lose closer to $100,000. Do you think they will just walk away? I do.
Asking Price: $399,999
Purchase Price: $390,000
Purchase Date: 7/30/2004
Address: 1504 Solvay Aisle, Irvine, CA 92606
1st Loan $400,000
Downpayment $-10,000
Beds: 1
Baths: 1
Sq. Ft.: 800
$/Sq. Ft.: $500
Lot Size: –
Year Built: 1995
Stories: 1
Type: Condominium
County: Orange
Neighborhood: Westpark
MLS#: S498790
Status: Active
On Redfin: 16 days
From Redfin, “Motivated Seller-Great location for UCI Student or Executive. Very cle an and ready for you to move in. Large Kitchen over looking the Dining and Living Rooms. Enjoy this great floor plan with it’s large Master Bedroom with a walkin closet and Private Bath. All on one level Plus Attached Garage Directly into your home.”
With the deterioration in the financing picture, I imagine this seller is even more motivated…
I have to laugh at these asking prices with $999. I guess the seller still wants to squeeze every last dollar out of this sale. Maybe we will have houses priced like gasoline soon with the 9/10 of a cent added on.
Not technically a rollback, but we are looking at a summer 2004 price, and after a 6% commission, this seller still stands to lose $14,000.94. The property records show a $400,000 first mortgage. I don’t know how this came to be as generally a 100% financing deal is an 80/20. Perhaps it reflects the outstanding value on their negative amortization loan, or perhaps they financed through a private party. If they actually got $10,000 back at closing, I don’t see them hanging on and weathering the storm. As Steve Miller would say, “Take the Money and Run.“
The low end of the market is being decimated. Everywhere we look we see rollback after rollback. Some neighborhoods hold out longer than others, but all are showing signs of stress. With the further tightening of credit, look for this deterioration to continue, and most likely get much, much worse.
