Sep 30th, 2006
by irvinesinglemom
Since this is an off-duty weekend for me (the ex has my little guy) I was able to feed my open house/model home habit for a little while this afternoon. I ran some errands from my (rental) home in Westpark through Woodbridge on my way to Woodbury. I noticed a paucity of Open House signs as compared to recent weekends. It's Saturday, and Sundays appear to be more popular for Open Houses in Irvine, so that might be one cause. Perhaps Realtors have some Open House fatigue, too. What with the summer just past, weekend after weekend sitting in the same Brady Bunch houses, they're probably a little depressed! (I sure would be!).
So I turned into Woodbury from the new Sand Canyon entrance. The city recently finished rehabbing Sand Canyon in that area and it's great - nice and new and wide. I drove by the La Casella sales office, noticed it was open, did a U-turn and pulled into the parking lot. There were 4 other cars there. Assuming one was the sales person's, this place was practically hopping compared to my recent observations of Woodbury's sales offices!
The lone sales guy at La Casella was rather strange. For starters, he didn't look like your average (i.e. professional dress, borderline haughty demeanor) home sales guy. He had lots of facial hair and kind of babbled at me when I asked for an information sheet. He told me the townhomes started at $730k and went to $900k and the way he explained it, made me think I wasn't going to be getting an information sheet! He ended up giving me one, mutttering something about some people quickly leaving without even looking at the models after being told the prices. So he was actually trying to make sure I was not one of those door darters before giving me a propaganda brochure and price sheet! Hmmm, is this a cost-savings thing I wonder?
Anyway, I went into the $730k plan first (actually listed as $735 on the sheet). It's a Lennar "Everything Included" home. Single story, very nice. The casita thing, though, is a hate it or love it gamble on Lennar's part, in my opinion. It's the third bedroom/bath, completely detached from the house, across the cute little courtyard which has an outdoor fireplace standard in it. The garage is also detached, in that you have to go through your private courtyard in order to get into the casita or the main house.
The casita thing would be fantastic for me if it had a kitchenette, so I could rent it out. Otherwise, it strikes me as kinda weird. And for that much money, I want my garage to be ATTACHED!
I went through the two larger models pretty quickly. Standard stuff - very nice, but not worth $835k and $890k!
As I departed through the sales office the salesguy called out to me "That was fast!" Uh, yeah.
The information sheet lists Irvine High, not Northwood, as this development's high school. Hmmm, I had thought that all of Woodbury would feed into Northwood. I'll need to be careful if I ever do buy into Woodbury - Northwood is the only high school in Irvine that I'd want my boy to attend.
I stopped off at just more one more place in Woodbury since I needed to do a Target run. 81 Mission, a Treo Plan 2. The Realtor's flyer had "$819,000" crossed out and $799,000 handwritten underneath. This was actually the first home I have been to in Woodbury that I really do NOT like. It feels a LOT older than it really is. Maybe that's because the owners apparently chose not one single upgrade - plain carpeting, linoleum, and a barren side yard made this feel more like a plain-vanilla apartment than a Woodbury house. I wouldn't buy this house even if the price dropped a full 50%.
It's kind of strange - even as the Commons and the shopping center get closer to completion, I find myself less and less enamored of Woodbury. This time last year I was practically obsessed with the place. I didn't buy for two reasons: my son's current daycare is in Westpark and I want to keep him there for a while (and I choose to live very close to it) and of course, I saw the bubble popping clear as day. Could it be because Portola Springs is even newer and is more topographically interesting? (Woodbury is flat, flat, flat, whereas Portola Springs is in the hills and has some nice views). Or could it be because my desire for a lake view has increased? (hello, Lake Mission Viejo!).
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Address: 129 Islington, Irvine, CA 92620 (Northwood)
Plan: 1250 sq ft - 2/2
MLS: P513933 DOM: 131
Sale History: 07/11/2005: $555,000
Current Price: $575,000
This property in the Greystone Villas tract sold in only 4 DAYS last year. Now the same property has been on the market for over 4 MONTHS!! Perhaps a reduction in price would help make the sale? It appears the property is tenant occupied. So could it be that the owner isn't bleeding money every month and is just hoping to get out of the market without any serious damage?
*IF* the property sells for the asking price, the owner is still looking at a loss of $14,500 (assuming 6% in commissions). OUCH! That's serious enough for me!
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The following are links to the analysis posts and assorted essays of Larry Roberts (Irvine Renter):
Foreclosure Series:
1-22-2010 -- Foreclosure 101: Mechanics of a Trustee Sale
1-21-2010 -- Foreclosure 101: Non-Judicial Foreclosure
1-20-2010 -- Foreclosure 101: Vesting Title
12-21-2009 -- Should You Walk Away from Home Debt? -- A review of the circumstances surrounding the walk-away phenomenon.
12-16-2009 -- Lenders Can Hold Real Estate Indefinitely -- Lenders have discretion over how they liquidate real estate owned.
Cost of Ownership Series
10-30-2009 -- Ownership Cost: Taxes and Opportunity Costs
10-29-2009 -- Ownership Cost: Homeowners Associations
10-28-2009 -- Ownership Cost: Property Taxes and Mello Roos
10-27-2009 -- Ownership Cost: Interest Rates and Downpayment Requirements
10-26-2009 -- Ownership Cost: Income, Payments and House Prices
9-16-2009 -- Cure Rates -- The rates at which people "cure" their ailing loans has declined to very low levels. People are walking away.
7-28-2009 -- Entitlement Leads to Socialism -- The housing bubble caused a shift in societal attitudes that leads to more socialist government programs.
7-6-2009 -- The Bailout for Prodigious Spenders -- Did renters benefit as much as owners did during the bubble years?
6-22-2009 -- Regulatory Solutions to Prevent the Next Housing Bubble -- Excerpt from final chapter of The Great Housing Bubble concentrating on regulatory solutions to the problem.
6-15-2009 -- Should Adjustable-Rate Mortgages be Curtailed? -- Another look at the problems created by adjustable rate mortgages and their place in the housing market.
3-30-2009 -- Responsible Homeowners are NOT Losing Their Homes -- People who were truly responsible with their borrowing are not losing their homes in the housing price crash.
3-2-2009 -- What Risks Should Borrowers Be Allowed to Take? -- Excessive risk caused the rise and fall of the housing bubble. Should some of the riskiest practices be eliminated?
2-12-2009 -- The Financial Implications of Short-Sales and Foreclosures -- Reference to an attorney's description of the what can happen in short sales and foreclosures depending upon the circumstances of the borrower.
2-9-2009 -- The Moral Hazard of Market Supports and HELOC Abuse -- Is the government's efforts to support the real estate market going to serve to create the psychology that inflates the next one?
1-19-2009 -- Tax Policy and Housing -- A review of the various tax programs and how they impact house prices
1-13-2009 -- Unlocking the Housing Market Recovery -- A review of a popular proposal for saving the economy and the housing market.
1-12-2009 -- Bring Back Paternalism in the Mortgage Market -- A plea to re-regulate the mortgage market.
11-17-2008 -- A Free-Market Solution to Prevent Housing Bubbles -- From the final chapter of The Great Housing Bubble.
11-13-2008 -- Reverse Liar Loans -- An example of how bailouts are creating more problems than they are solving.
11-11-2008 -- The Carrot and The Stick -- a look at what is really necessary to make a homeowner bailout program successful.
3-17-2008 -- Bailouts and False Hopes -- A cynical look at the psychology of potential bailouts.
3-15-2008 -- Mortgage Default Losses -- Parsing the distinction between default rates and resulting default losses on residential loans.
3-12-2008 -- Mortgages as Options -- A look at how borrowers and speculators gamed the system using mortgages as option contracts.
2007-04-16 -- How Homedebtors Could Avoid Foreclosure -- A look at a potential financing mechanism which might be used to assist homeowners who are underwater. It also examines the potential implications of the widespread use of such tools.
2007-03-24 -- Who is responsible for this mess? -- A rant on the difficulty of identifying the party or parties responsible for our current problems.
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The following are links to the analysis posts and assorted essays of Larry Roberts (Irvine Renter):
2-17-2010 -- Use FHA Financing: Loan Assumption is the Appreciation of the Twenty-Teens -- Obtaining financing equity through assumable mortgages is the way to benefit from home ownership in the next decade.
1-29-2010 -- The Changing Face of Flipping -- Flips come in a variety of flavors, some of which taste better than others.
Foreclosure Series:
1-22-2010 -- Foreclosure 101: Mechanics of a Trustee Sale
1-21-2010 -- Foreclosure 101: Non-Judicial Foreclosure
1-20-2010 -- Foreclosure 101: Vesting Title
1-18-2010 -- A Theory of House Prices and Housing Markets -- A foundational teaching on housing.
10-13-2009 -- Alternate Market Price Measurements -- Post looks at price measurements other than the median.
10-12-2009 -- Median as Market Price Measurement -- Post examines the good and bad qualities of using the median.
10-7-2009 -- Time to Payoff -- Building on Accelerated Amortization, this posts details how to use this new investment metric.
10-5-2009 -- Accelerated Amortization -- Paying off a loan quicker is the key to an early retirement.
9-14-2009 -- Real Estate, Cashflow Investment and Retirement -- Real estate can and should be a part of your retirement plan, but don't bank on appreciation. Cashflow is the key.
8-20-2009 -- IHB Investor Reports -- A detailed review of the information in our proprietary investor report.
8-18-2009 -- IHB Property Valuation Reports -- A detailed review of the information in our proprietary owner-occupant report.
8-12-2009 -- Climate Value -- Does good weather make property more valuable? Everyone wants to live here, right?
8-3-2009 -- Going Flat -- Making money in real estate through selling and buying back into the market at a later date for less money.
7-20-2009 -- Rental Parity and Beyond -- A conceptual review of the concept of rental parity and how it can be applied to real estate market pricing.
3-31-2008 -- Investment Value of Residential Real Estate -- An economic analysis of the true investment value of residential real estate.
3-13-2008 -- Floplords -- A discussion of the phenomenon of accidental landlords.
2-28-2008 -- Affordability -- A review of the concept of affordability and what it means for the housing market.
2-25-2008 -- The Credit Crunch -- A discussion of the causes and implications of the credit crunch.
2-18-2008 -- Selling for Less -- A look at the changing market environment where buyers are in control of the action.
2-4-2008 -- What is Equity? -- Looking at the components of homeowner equity and the factors that impact it.
1-28-2008 -- Speculation or Investment -- Comparing the motivations and activities of two distinct classes of purchasers of real estate. Knowing the difference between speculation and investment can make the difference between making and losing money.
1-14-2008 -- Rent Versus Own -- A detailed look at the cost of ownership and the various reasons to rent or own a particular property.
2007-05-14 -- The Anatomy of a Credit Bubble -- A detailed, mathematical analysis of the impact changing lending standards had on home prices. This is fundamental to understanding of the mechanics of the real estate bubble.
2007-05-07 -- Your Buyer’s Loan Terms -- The precursor to The Anatomy of a Credit Bubble. It discusses house prices from the perspective of the future buyer of your home. It demonstrates the impact changes in loan terms will have on future buyers and how this will impact the amount your future buyer can bid for your home.
2007-04-30 -- Appreciation is Dead -- Rapid home price appreciation has become an accepted truism in Southern California. There are many reasons to believe this is not a basic Truth of Life. This post examines the causes of appreciation and explores the reasons why it may all be coming to an end.
2007-04-08 -- Southern California’s Cultural Pathology -- An exploration of the unique cultural beliefs which made the housing bubble take hold in Southern California. This is a critical post to understanding why the bubble was so pronounced here while in other areas of the country it was not as extreme.
2007-03-09 -- What if Prices Dropped to Fundamental Values? -- A brief "what if" on the impact a decline to fundamental valuations would have on Orange County housing prices.
2007-03-03 -- How Inflated are House Prices? -- A discussion of the fundamental valuation of housing prices. This post is essential reading to anyone wanting to understand how residential homes should be valued.
Outside Links
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IHB Analysis Posts
General
The following are links to the analysis posts and assorted essays of Larry Roberts (Irvine Renter):
3-2-2010 -- Interest-Only Loans Join Option ARMs in Dustbin of Financial History -- The ongoing credit crunch witnesses the elimination of another dubious loan program.
3-1-2010 -- The Bernanke Put: The Implied Protection of Mortgage Interest Rates -- How will the Federal Reserve manage the increase in mortgage interest rates?
2-17-2010 -- Use FHA Financing: Loan Assumption is the Appreciation of the Twenty-Teens -- Obtaining financing equity through assumable mortgages is the way to benefit from home ownership in the next decade.
1-29-2010 -- The Changing Face of Flipping -- Flips come in a variety of flavors, some of which taste better than others.
1-18-2010 -- A Theory of House Prices and Housing Markets -- A foundational teaching on housing.
10-20-2009 -- Hard Crash? or Soft Landing? -- A philosophical examination of which way you like to take your medicine.
10-13-2009 -- Alternate Market Price Measurements -- Post looks at price measurements other than the median.
10-12-2009 -- Median as Market Price Measurement -- Post examines the good and bad qualities of using the median.
9-2-2009 -- Shadow Inventory Orange County -- With a little data and some complex analysis, it is possible to get an accurate picture of the shadow inventory in Orange County.
8-13-2009 -- Bottom? or Bear Rally? -- Will foreign cash buyers sustain real estate valuations at inflated prices? Not according to Rich Toscano.
7-20-2009 -- Rental Parity and Beyond -- A conceptual review of the concept of rental parity and how it can be applied to real estate market pricing.
7-13-2009 -- 1997 -- A careful look at the conditions at the bottom of the last real estate market with comparison to today.
6-29-2009 -- The Immunity Syndrome -- The belief that prices cannot fall at the high end prompted speculators to bid prices up to inconceivable levels. The high end may crash hardest.
3-9-2009 -- The Market Bottom Is Not a Price Point -- The bottom of a real estate market is not a specific price point, but a state of affordability.
10-6-2008 -- Fundamentals at a Market Bottom -- A review of what market conditions prevail at the bottom of the housing cycle.
9-29-2008 -- Desire is not Demand -- A revealing look at the final myth propagated by realtors during a price decline.
8-11-2008 -- Timing Does Matter -- An analysis dispelling the myths about timing the residential real estate market.
3-11-2008 -- Houses and Commodities Trading -- An examination of the parallels between commodities markets and the behavior of residential real estate markets.
10-1-2007 -- What Caused the Bubble Rally? -- A detailed analysis of the conditions the preceded the bubble rally and the causes of its inflation.
9-13-2007 -- The Market Bottom -- A review of the conditions that formed the last market bottom and why it formed at the price level it did.
2007-06-25 -- Houses Should Not Be a Commodity -- A discussion of the psychology of commodity market trading and why this is an undesirable element in housing markets.
2007-04-30 -- Appreciation is Dead -- Rapid home price appreciation has become an accepted truism in Southern California. There are many reasons to believe this is not a basic Truth of Life. This post examines the causes of appreciation and explores the reasons why it may all be coming to an end.
Time-Sensitive Projection
2-1-2010 -- No Housing Market Bottom -- A review of current circumstances to reaffirm the housing market has not bottomed.
10-19-2009 -- Rent? or Own? Fall 2009 -- A look at the state of the rent versus own decision in late 2009.
9-28-2009 -- The 2011 Inflation Spike -- The Federal Reserve may allow inflation to spike in the medium term.
9-2-2009 -- Shadow Inventory Orange County -- With a little data and some complex analysis, it is possible to get an accurate picture of the shadow inventory in Orange County.
5-18-2009 -- Irvine's Future REO Inventory -- A review of the building wave of foreclosures due to hit the Irvine market.
5-11-2009 -- Temporary Affordability and the Third Foreclosure Wave -- An analysis of the problem adjustable rate mortgage create for the future of the housing market.
4-20-2009 -- Pent-Up Supply -- A buildup of inventory at the mid to high end of the housing market signals an upcoming drop in prices.
3-23-2009 -- Real Estate's Lost Decade -- Rising interest rates could stop appreciation for a full decade.
2-2-2009 -- Fire and Ice -- Is it better for the market to correct quickly or slowly? An analysis of the implications of both methods of market correction.
11-12-2008 -- The ARM Problem -- Adjustable rate mortgages scheduled to reset from 2009-2011 are the next wave of foreclosures that will flatten the real estate market.
8-25-2008 -- I Was Wrong, It’s Worse… -- A review of projections of future price drops 18 months later.
2007-04-02 -- How Bad Could Bad Get? -- A look at the worst case scenario for our housing market, and why it is not unrealistic.
2007-03-14 -- Why the Sub-Prime Meltdown is a Problem -- Many have postulated the sub-prime collapse would not impact housing prices in more affluent areas like Irvine. This brief post debunks this idea.
2007-03-11 -- Predictions for the Irvine Housing Market -- A prediction for the future of housing prices in Irvine based on an analysis of emerging data and trends. This is the capstone post tying together the series of posts from 3-1 to 3-9.
2007-03-09 -- What if Prices Dropped to Fundamental Values? -- A brief "what if" on the impact a decline to fundamental valuations would have on Orange County housing prices.
2007-03-06 -- What is Past is Prologue -- A review of the mechanics of the collapse of the last bubble to provide a foundation for the projections of the market action in our current market bubble.
2007-02-27 -- I am IrvineRenter (Inventory Cholesterol) -- A brief introductory post and a discussion of the different types of housing inventory and how they impact prices.
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The following are links to the analysis posts and assorted essays of Larry Roberts (Irvine Renter):
1-26-2010 -- Urgency Versus Reality: realtors Win, Buyers Lose -- a look at the pathology of the realtor mindset of creating urgency at buyer's expense.
Foreclosure Series:
1-22-2010 -- Foreclosure 101: Mechanics of a Trustee Sale
1-21-2010 -- Foreclosure 101: Non-Judicial Foreclosure
1-20-2010 -- Foreclosure 101: Vesting Title
1-18-2010 -- A Theory of House Prices and Housing Markets -- A foundational teaching on housing.
12-21-2009 -- Should You Walk Away from Home Debt? -- A review of the circumstances surrounding the walk-away phenomenon.
12-2-2009 -- Sell a Home: For Sale By Owner
12-1-2009 -- Sell a Home: Cash Listing Services
11-30-2009 -- Sell a Home: Conventional Brokerage Listing
9-2-2009 -- Shadow Inventory Orange County -- With a little data and some complex analysis, it is possible to get an accurate picture of the shadow inventory in Orange County.
8-20-2009 -- IHB Investor Reports -- A detailed review of the information in our proprietary investor report.
8-18-2009 -- IHB Property Valuation Reports -- A detailed review of the information in our proprietary owner-occupant report.
8-3-2009 -- Going Flat -- Making money in real estate through selling and buying back into the market at a later date for less money.
6-29-2009 -- The Immunity Syndrome -- The belief that prices cannot fall at the high end prompted speculators to bid prices up to inconceivable levels. The high end may crash hardest.
5-4-2009 -- Negotiating for Real Estate -- An overview of the negotiation process for residential real estate.
8-11-2008 -- Timing Does Matter -- An analysis dispelling the myths about timing the residential real estate market.
3-31-2008 -- Investment Value of Residential Real Estate -- An economic analysis of the true investment value of residential real estate.
3-13-2008 -- Floplords -- A discussion of the phenomenon of accidental landlords.
3-12-2008 -- Mortgages as Options -- A look at how borrowers and speculators gamed the system using mortgages as option contracts.
Read the rest of this entry »
