The first post in the series introduce you to the
people behind the IHB, and later posts will help prepare you for the
next steps in the process by showing you how to use the resources on
our website. This program educates you on the what to expect your
exciting real estate adventure. You will approach your home purchase or
sale with confidence because we will guide you on your journey and
assist you along the way.
Personal help from the IHB is always
available. You can visit the IHB forums, consult our knowledge base, post questions, and learn from experts on a variety of subjects.
In
this post, I will share with you the history, mission and services of
the IHB as well as brief biographies of the people behind both the blog
and the brokerage. In future posts, you will receive more detailed
information and personal messages from me (Larry Roberts) and Shevy
Akason. We want you to know us, not just know about us.
We want you to know the character of the people you will come to rely
on to meet your real estate needs. Character matters; you can trust
that the people responsible for helping you find your ideal home are
personable, dependable and committed to excellence. We provide more
than education and brokerage services; we provide peace of mind.
IHB History, Mission and Services
The IHB began as the Irvine Housing Blog in September of 2006. The IHB
became know for its integrity, honesty and bluntness
concerning the
real estate market. The scope of the IHB expanded in May of 2009
when Ideal Home Brokers was added to its acronym. It is unclear whether
Ideal Home Brokers are brokers finding ideal homes or ideal brokers
finding homes; we will let you
decide.
The mission of the IHB is (1) to provide general real estate education,
(2) to analyze and report market conditions, and (3) to assist in home
sales transactions.
In order to achieve our mission, we perform the following services: (1) provide
real estate instruction and evaluation; (2) foster a community of
like-minded educators, professionals and everyday people in the IHB
forums; (3) supply unique property valuation reports to our clients;
and (4) facilitate real estate sales without pressure, manipulation, or
emotional appeals.
In short, we will teach you about housing, show you where the deals are, and help you buy your home; that is what we do.
Larry Roberts — Irvine Housing Blog
Credentials:
Master of Science in Land Development – Texas A&M University 1994
Bachelors of Science – University of Wisconsin at Stevens Point 1992
I
have been involved with real estate my entire career. I work as a
consultant to the land development industry where I have worked on the
evaluation, acquisition, development, and disposition of over $100
million in real estate assets during my career.
My expertise in real estate is documented in the daily posts for the Irvine Housing blog and in my seminal work on The Great Housing Bubble. I publicly predicted the collapse of house prices and worked diligently
for years to convince people not to buy housing while prices declined;
I saved countless families from financial ruin in the process.
As
prices dropped to affordable levels, my attention turned to helping
people navigate the treacherous waters of real estate negotiation. I
felt that if I did not do this, many people would not receive the
honest service and accurate analysis they deserved. After helping
people ignore the Siren’s Song of unlimited real estate wealth and
avoid crashing on the foreclosure rocks, I could not abandon them when
the time came to finally get the home they had been waiting for.
Shevy Akason — Ideal Home Brokers
Credentials:
Bachelor of Arts- Claremont Mckenna College 2003
Real Estate investor since 2004
Academic All American- NDSCS 2001
Associates Degree- NDSCS- Business Administration 2001
Shevy
has always been interested in Real Estate. He began investing in real
estate soon after graduating college by investing in properties
out-of-state that demonstrated positive cashflow using conventional
financing. The property investments provided a connection to the world
of real estate as he started a construction company to add value to his
own real estate and provide service to others. His goal has always been
to serve others through helping them buy, sell or improve real estate.
Now
that the real estate bubble has burst, he wants to help people find the
right home for them. Since late 2007, his focus has been on helping
people navigate the rough waters of a housing market decline. He has
convinced many clients to postpone their property purchase, and those
that have bought homes did so knowing the risks. All have used stable
financing with conservative metrics; they will not become foreclosure
statistics.
He is a competitive person; he enjoys many team
sports, and the challenges of being an entrepreneur. This competitive
spirit helps him represent you in the sometimes confrontational world
of real estate negotiation. There is a balance between pushing so hard
that the deal crumbles, and not pushing hard enough to get the most
favorable price and terms. He always seeks this point of balance where
good deals go through and both parties are satisfied with the results.
He is proud of his
track record and how he operates in the world of real estate. He prides himself on
giving people a clear picture of the market and helping them to feel
comfortable with the biggest decision of their lives. He is a great addition to the IHB.
Thank you again for allowing us the opportunity to present ourselves to you in this manner. We look forward to working with you.
Sincerely,
Larry Roberts
When you are ready to buy or sell a home, we are here to serve you.
Is this what free travel costs? A phone and a wallet and a new ipod Your grace and your last shreds of dignity Are thrown away as you begin to plead For what you believe could be your life or your teeth Your love or your money or your wife to be There’s answers to questions you’ll forever seek Why did you do it to me?
As I reflected on the design and layout of the Ideal Home Brokers site, I began to ask myself what questions people might have that we can answer here at the IHB. One of the first questions people ask when they begin their home search is “how much house can I afford?” We can answer that one.
I am not a mortgage broker, and I have no doubt there are programs where you can finance much larger numbers than what we show in our calculator. The calculator shows what people can really afford using conservative financing metrics; what people can finance is different — it shouldn’t be, but it is. Lenders occasionally create new Ponzi Schemes where terms and the amounts financed are unstable, as was the case during the Great Housing Bubble.
Using the Calculator
To begin working with the calculator, you must press the button, “click to edit.” This opens the spreadsheet and will allow you to change cell entries. Confine your changes to the second column marked “Inputs.” Do not refresh the page or navigate away during your work, or you will lose your changes. Your work cannot be saved.
The sheet comes pre-populated with generic entries based on historic norms in the Inputs column. There are many formulas in this column as well, but you can overwrite them with your own data. Any critical formulas are in the Calculations column; don’t change them.
Your Personal Analysis
Since the primary determinant of affordability is gross income, the spreadsheet starts there. Input that number plus any non-housing monthly debt obligations you have.
The spreadsheet default is for an FHA purchase. The maximum purchase price based on your income is calculated, and the remainder of the calculations are based on those numbers. If you change the downpayment from the FHA-standard 3.5% to a higher number, the calculation will change to metrics based on historic financing standards.
Cost of Ownership
If you are not interested in financing criteria, and instead you can plug in a specific property’s purchase price and see the cost of ownership as described in Rent Versus Own and IHB Property Valuation Reports.
No Comparable Data
Without having comparable sales and rental data for a specific property, there is little else that can be calculated. I had originally intended to provide a spreadsheet similar to the one that generates our IHB Property Valuation Reports. It can’t be done without data on comparables.
Asking Price: $826,800
Income Requirement: $156,536 Downpayment Needed: $165,360
Beds: 4 Baths: 4 Sq. Ft.: 2,268 $/Sq. Ft.: $365 Lot Size: 3,000 Sq. Ft. Property Type: Condominium Style: French Stories: 2 Floor: 1 Year Built: 2007 Community: Woodbury County: Orange MLS#: S589422 Source: SoCalMLS Status: Active On Redfin: 2 day
One of great locations, step to the park, school and shopping center. Open floor plan, one bedroom w/bath downstairs, plus powder room, Total 4 bedrooms with 3 1/2 bathrooms. Marble entry, built-in media cabinet. Bamboo hardwood floor at Kitchen and Dinning area, Upgraded Carpets, KitchenAid Stainless Steel Appliances, Stainless undermount sink & faucet, Huge Center Island & Full Splash Granite Countertop. Nature stone in Master Bathroom, Tiles in all bathrooms and Laundry Room. Plantation Shutters at all windows, Recess lights and j-box in all bedrooms. Fiber optics phone/internet, satelite ready, wireless security system, professionally finished yard w/slate stone hardscape & auto sprinkler systems. Built-in cabinet in garage.
Come to my window Crawl inside, wait by the light Of the moon Come to my window Ill be home soon
I would dial the numbers Just to listen to your breath I would stand inside my hell And hold the hand of death You dont know how far Id go To ease this precious ache You dont know how much Id give Or how much I can take
Beds 6 Baths 3 baths Size 2,700 sq ft ($274 / sq ft) Lot Size 5,000 sq ft Year Built 1974 Days on Market 29 Listing Updated 9/17/2009 MLS Number R905432 Property Type Single Family, Residential Community Walnut Tract Cc
PRICE REDUCED, PRICE REDUCED, EQUITY SELLER, Beautiful, Turnkey, Irvine Home with 6 bedrooms, 3baths, Large Study upstairs w/ skylights, 4 bedrooms on main floor, 2 bedrooms upstairs. Recent remodel includes granite countertops in kitchen, new copper plumbing throughout, wood flooring / travertine combination. Spacious backyard with in ground Spa. Wonderful neighborhood, close to shopping and award winning schools. Community pool, tennis courts, volleyball and much much more. All remodel done with City Permits and approvals. This home will not last. Open house to be held Saturdays and Sundays until property is sold. All offers will be reviewed immediately by owner and agent. Multiple Offers will be reviewed and a decision made to highest and best qualified buyer. Fast response, ready to close escrow.
Nice to know what they plan to do with those multiple offers.
This property was purchased on 3/8/2002 for $340,000. The owner used a $255,000 first mortgage and an $85,000 downpayment.
A month later, he opened a HELOC for $66,000, just in case.
On 7/9/2003 he refinanced with a $379,200 first mortgage.
On 8/28/2003 he opened a HELOC for $47,400.
On 1/30/2004 he opened a HELOC for $97,800.
On 5/4/2005 WAMU gave him a HELOC for $500,000!
This property must have appraised for around $880,000 for WAMU to have given out such a large HELOC. For this owner to be an equity seller, he must not have tapped the $500,000 equity line heavily. Do you believe it?
{book1}
And so concludes another week at the Irvine Housing Blog, chronicling the Irvine home market since September of 2006.
The defensive perimeter of the kool-aid intoxicated in Woodbridge is Yale Loop. The foreclosures and defaults are threatening to overrun market prices.
In my defence, what is there to say? All the mistakes we’ve made must be faced today It’s not easy now, knowing where to start While the world we love tears itself apart
I’m just a singer with a song How can I try to right the wrong? For just a singer with a melody I’m caught in between, with a fading dream
At the end of World War I, the French decided it would be a good idea to construct a massive defensive line along the German border to deter a major ground offensive: the Maginot Line. It turned out to be an expensive boondoggle as the Germans simply flanked the complex and conquered the French in May 1940. Never has so much money been spent in a completely wasted effort to overcome a problem… sounds like our various homedebtor bailouts and market manipulation, doesn’t it?
Just as the French had the Maginot Line to give them a false sense of security, residents of Woodbridge have Yale Loop.
Residents who really “know” Woodbridge will tell you there is a
hierarchy of desirability radiating outward from the center.
Neighborhoods closer to the lakes have larger homes and are more
desirable. People in this area are the creme de la creme, and they defecate without odor.
Those who live outside the loop are the “wannabes” who really aren’t
worthy of Woodbridge’s aura of greatness. You must pardon my facetious
banter, but I was given a very similar description by a long-time
resident. Interesting that even within one of Irvine’s best
neighborhoods, the competition to put oneself above others is notable.
Prices inside the loop have barely budged since the peak, whereas prices outside the loop are getting hammered. Not all of the product inside the loop is single-family detached housing at high price points. Wherever the condos have crossed the Maginot Loop, the foreclosure problem has taken hold, and further price blowouts are on the way.
Beds 4 Baths 2 full 1 part baths Size 1,900 sq ft ($405 / sq ft) Lot Size 3,400 sq ft Year Built 1985 Days on Market 2 Listing Updated 9/23/2009 MLS Number S590292 Property Type Single Family, Residential Community Woodbridge Tract Othr
According to the listing agent, this listing is a bank owned (foreclosed) property.
Wonderful Inside Loop – Corner Lot Location. Convinient One Bedroom & 3/4 Bath Downstairs. Owner Spent $20k to Create A Beautiful Back Yard Retreat With Tranquil Fountain, Custom Follage Lighting, Stone Planters Box Wall, and Stamped Concrete (See Pics). It’s like Having Your Own Tropical Get Away. This Home Also Boasts A Whole House Attic Fan To Cut Down On A/C Costs. Plantation Shutters, Vaulted Ceilings, Direct Access Garage, and Longer Driveway To Park Your Cars Make This A Must see. Short Walk To School Pools & Parks. Enjoy All Woodbridge Amenities
Convinient? Custom Follage Lighting?
Why Title Case?
This asking price is relatively easy to explain; these owners have money in the property. This house was purchased for $741,000 on 4/14/2004. The owners used a $592,800 first mortgage and a $148,200 downpayment. They later refinanced the first mortgage for $585,000 which suggests they were paying down the first mortgage. They did get a $250,000 HELOC at the peak, but there is no indication they spent it. Perhaps they were the exception to the rule.
{book3}
Just for fun, let’s try to identify the objects on the mantle.
First the black wooden statue on the left and the picture on the right. Rama Sita and Edward Scissorhands?
What is on that decorative plate?
The plaque looks to have a red pig on it. Perhaps they are Arkansas Razorback fans?
What is next to the tiny champagne bottle? Blue topaz? Wyland Gallery?
We all go through life attaching ourselves to objects. Some appear on our mantles to remind us of times past. What is on your mantle?
I, I love the colorful clothes she wears And the way the sunlight plays upon her hair I hear the sound of a gentle word On the wind that lifts her perfume through the air
Im pickin up good vibrations Shes giving me excitations Im pickin up good vibrations
In 1968 there were few large-scale master plans, and many of the principals of urban planning were in their infancy. There were many good ideas but little empirical evidence that planned communities would be superior to their unplanned counterparts. Now that these visionary communities of the 60s and 70s are established, we can review and appraise the success of the features the planners got right. University Park was one of these planned communities.
I have lived in University Park for as long as I have been writing for the IHB. I have been able to enjoy some unique neighborhood features that came about by design.
Back when University Park was developed, the majority of housing being built was ranch-style homes from 1,200-1,800 SF. There were very few townhome projects being completed, and few of those were being developed out on the fringe — which Irvine was back in 1968. The planners made a simple supposition: if you cluster development into townhomes, you can obtain a better yield than a conventional subdivision, and you could set aside land for parks linked together by a walking trail.
It worked. University Park is a classic example of what is possible with good planning. Creating a higher quality of life for residents adds value.
University Park does not sell at a premium to other Irvine neighborhoods partly due to its age and party due to the exceptional planning in newer neighborhoods; however, University Park does trade at a premium to similar townhomes in nearby communities. Some of that premium is due to the schools, but in my opinion, most of this value is due to good land planning…. Of course, I could be biased…
Asking Price: $590,000
Income Requirement: $111,703 Downpayment Needed: $118,000
Purchase Price: $760,000 Purchase Date: 5/3/2006
Net Gain (Loss): -$205,400 Percent Change: -22.4% Annual Appreciation: -6.6%
Beds 3 Baths 1 full 1 part baths Size 2,268 sq ft ($260 / sq ft) Lot Size 2,880 sq ft Year Built 1968 Days on Market 23 Listing Updated 9/17/2009 MLS Number P701953 Property Type Single Family, Residential Community University Park Tract V2
According to the listing agent, this listing is a bank owned (foreclosed) property.
Wonderful two story condo in a great location. Large open floorplan with three bedrooms plus bonus room and two baths. Spacious kitchen has tile floors and counters; open living room with fireplace; main floor bedroom and bathroom with dual sinks; two car attached garage; enclosed front courtyard and large rear patio; new upgrades include new paint and carpet.
Good planning may add value, but it does not justify a housing bubble price. The guy who bought this place for $760,000 used a $608,000 first mortgage, a $59,200 HELOC and a $92,800 downpayment. Ouch!
I
Asking Price: $739,900 
