Crying — Aerosmith
I was cryin’ when I met you
Now I’m tryin’ to forget you
Your love is sweet misery
For all our wisdom and collective experience, none of us knows what the markets will do next. Like an ocean current or a raging river, a financial market charts its own course. It is fickle and feckless and flows without regard to our hopes and dreams. The ebbs and flows of financial markets are meaningful to us, but in reality they are just movements in price; nothing more. Price rallies make homeowners blissful and renters bitter, while price declines make homeowners gloomy and renters gleeful. These feelings and emotions are independent of movements in price. The market just moves, that is all it does. It is benign, yet dangerous; it is indifferent, yet demonstrative; the market is a paradox which we must simply accept.
I was cryin’ just to get you
Now I’m dyin’ ’cause I let you
When today’s featured property was purchased in 2005, the owner undoubtedly thought they made the purchase of a lifetime. This property was certain to appreciate at 15% a year. It would be worth $2,000,000 soon enough. Now the owner is trying to forget this place. They listed the property at a short-sale price, they have proceeded to knock almost 20% off the asking price and still no takers.
Listing Price History
| Date | Price |
| Aug 26, 2008 | $535,000 |
| Sep 05, 2008 | $525,000 |
| Sep 17, 2008 | $515,000 |
| Sep 25, 2008 | $505,000 |
| Sep 29, 2008 | $495,000 |
| Oct 07, 2008 | $485,000 |
| Oct 15, 2008 | $465,000 |
| Oct 20, 2008 | $445,000 |
| Oct 21, 2008 | $435,000 |
| Oct 27, 2008 | $425,000 |
Of course, they are not alone. We have profiled another property nearby lately: 65 Weepingwood #97, Irvine, CA 92614. This nearly identical property was an REO, and the lender let it go for $385,000. Do you think today’s seller will get 10% more? I doubt it.
Asking Price: $425,000
Income Requirement: $106,250
Downpayment Needed: $85,000
Monthly Equity Burn: $3,499
Purchase Price: $565,500
Purchase Date: 10/28/2005
Address: 97 Weepingwood, Irvine, CA 92614
| Beds: | 3 |
| Baths: | 3 |
| Sq. Ft.: | 1,582 |
| $/Sq. Ft.: | $269 |
| Lot Size: | – |
| Property Type: | Condominium |
| Style: | Other |
| Year Built: | 1983 |
| Stories: | 2 Levels |
| Floor: | 1 |
| Area: | Woodbridge |
| County: | Orange |
| MLS#: | S545417 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 63 days |
No wasted words in that description.
This property was purchased for $565,500 on 10/28/2005, the same day as the comparable property. The owner used a $452,400 first mortgage, two HELOCs for $56,550, and a $0 downpayment. There are two more HELOCs opened later for $17,000 and $116,500 respectively. It appears as if the total debt on the property is the total of the first mortgage and the final HELOC: $568,900, although it could be $17,000 higher.
If this sells for its asking price, and if a 6% commission is paid, the total loss to Wells Fargo will be $169,400. And I thought they were a conservative lender…
{book}
Get a Grip
There was a time
When I was so broken hearted
Love wasn’t much of a friend of mine
The tables have turned, yeah
‘Cause me and them ways have parted
That kind of love was the killin’ kind
Listen, all I want is someone I can’t resist
I know all I need to know by the way that I got kissed
I was cryin’ when I met you
Now I’m tryin’ to forget you
Love it sweet misery
I was cryin’ just to get you
Now I’m dyin’ ’cause I let you
Do what you do down on me
Now there’s not even breathin’ room
Between pleasure and pain
Yeah you cry when we’re makin’ love
Must be one and the same
It’s down on me
Yeah I got to tell you one thing
It’s been on my mind
Girl, I gotta say
We’re partners in crime
You got that certain something
What you give to me
Takes my breath away
Now the word out on the street
Is the devil’s in your kiss
If our love goes up in flames
It’s a fire I can’t resist
I was cryin’ when I met you
Now I’m tryin’ to forget you
Your love is sweet misery
I was cryin’ just to get you
Now I’m dyin’ ’cause I let you
Crying — Aerosmith
Ain’t the pictures enough, why do you go through so much
New Listing (24 hours)
It’s unbelievable it’s strange but true
As I walk through the valley where I harvest my grain
In the meantime, the banks are lining up bagholders to absorb the remaining market losses. There is still plenty of kool aid in the market in Irvine, and there seems to be no shortage of those with good credit and enough cash willing to buy at our inflated prices. Of course, there is also no shortage of distressed properties either, and this supply will continue to grow. Bagholders provide a useful function. If these people did not step forward to overpay for housing, the banks would be absorbing even larger losses, and our economic system would be put in even more jeopardy.
Riding on the range,