Sorry for the duplicate post, but our comments crashed on the first one…
Capitulation is a fancy word for giving up. The price declines at
the low end are leaving owners hopeless, so homedebtors and
specuvestors are simply giving up.
Today’s featured property was just profiled here on the IHB back in January. We are revisiting today because recent price reductions make it the largest percentage discount I have seen to date: 48.6%.
Asking Price: $199,900
Address: 2206 Apricot Dr #206, Irvine, CA 92618
{book3}
Little Things Give You Away — Linkin Park
And now there will be no mistaking
The levees are breaking
Hope decays
Generations disappear
Washed away
As a nation simply stares
It will be interesting to see what comes from our pop music during
the later stages of this recession/depression. Will we hear sounds of
despair? Will we fully retreat into mindlessly happy denial? Hardship
inspires great art. I hope we see some.
We talk about the pointlessness of following short sales, but there is
still much to learn from them. Why are we seeing price reductions? This
property may not have received bids at higher price points, so
the lender may have asked the owner to lower the price until offers
come in. Loss mitigation procedures at the lenders are in a state of
flux similar to market pricing. The lenders
are unpredictable. Perhaps they will start accepting short sales to
avoid the foreclosure process. Who knows?
This property is probably near rental parity, even with the $310 HOA
dues. Assuming someone wants to live in this place, it may be a good
deal. For an investor, it is still too high.
Maybe this price reduction means nothing. Maybe it is a sign that
banks are getting more serious about clearing out their REO inventory.
It is the little things that give them away.
{book5}
Income Requirement: $49,975
Downpayment Needed: $39,980
Monthly Equity Burn: $1,666
Purchase Price: $389,000
Purchase Date: 6/21/2006
Address: 2206 Apricot Dr #206, Irvine, CA 92618
Beds: | 2 |
Baths: | 2 |
Sq. Ft.: | 910 |
$/Sq. Ft.: | $220 |
Lot Size: | – |
Property Type: | Condominium |
Style: | Contemporary/Modern |
Year Built: | 1979 |
Stories: | 1 |
Floor: | 1 |
View: | Mountain, Pool |
Area: | Orangetree |
County: | Orange |
MLS#: | S559747 |
Source: | SoCalMLS |
Status: | Active |
On Redfin: | 61 days |
Bath condo with Patio/Balcony out Master and Dining Area. Open floor
plan. Fireplace in Living area. Close to shopping and Freeway. Secured
building. Elevator and intercom. Handicap access. HOA provides water,
gas, trash, maintenance, pool spa, lit tennis courts, basketball court
and tot lot.
This property was purchased at the peak on 6/21/2006. The owner used a $311,200 first mortgage, a $77,800 second
mortgage, and a $0 downpayment. If this property sells for its asking
price, the lender stands to lose $201,094 after a 6% commission.
We are on the cusp of seeing properties transact at 50% off peak pricing here in Irvine. Armageddon is upon us.
Here is a video for those who want to discuss decorating.
{book4}
Water grey
Through the windows, up the stairs
Chilling rain
Like an ocean everywhere
Don’t want to reach for me do you
I mean nothing to you
The little things give you away
And now there will be no mistaking
The levees are breaking
All you’ve ever wanted
Was someone to truly look up to you
And six feet under water
I
Do
Hope decays
Generations disappear
Washed away
As a nation simply stares
Little Things Give You Away — Linkin Park