Charming detached condo on a quiet street. Warm home with peaceful sun
soaked back landscaped courtyard. Wood flooring and custom paint.
Within walking distance to Alderwood elementary. Resort style pools,
spas, gym and parks all part of the association. Near the 405/5/133
FWYs. Close by entertainment includes the Irvine Spectrum and Laguna
Beach.
sun soaked? Look at the surrounding walls and buildings. That courtyard will feel more like a cave than an open patio.
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Paid peak prices past the peak. Check...
Watched prices drop 20% since then. Check...
Asking for a profit despite market conditions. Check...
Praying for a greater fool to come along. Check...
Preparing for a short sale. Check...
Feeling stupid. Check...
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I know I stand in line until you think You have the time to spend an evening with me And if we go someplace to dance I know that there's a chance you won't be leaving with me And afterwards we drop into a quiet little place And have a drink or two...... And then I go and spoil it all by saying Something stupid like I love you
I can see it in your eyes that you despise The same old lines you heard the night before...... And though it's just a line to you for me it's true...... And never seemed so right before I practice everyday to find some clever lines To say to make the meaning come true...... But then I think I'll wait until the evening gets late And I'm alone with you The time is right your perfume fills my head...... The stars get red and on the nights so blue...... And then I go and spoil it all by saying Something stupid like I love you
Perhaps the best illustration of the problem with the housing market is the simplest one. Speculators with access to 100% financing did not have to worry about losing money, so they went out and bought every property available and bid prices up to very high levels. Now that prices are falling, they are simply walking away and letting the lender absorb the loss. The big lesson lenders are learning is that 100% financing brings in more business, it just isn't the kind of business you want. The new housing bailout bill passed by Congress and signed by the President has a provision in it eliminating downpayment assistance programs. From this day forward everyone will need a downpayment. With all the losses lenders are absorbing due to the defaults of 100% financing purchases and refinances, you will not see them bringing those programs back any time soon.
When I first started putting downpayment requirements on posts, people were incredulous. I was repeatedly told 20% downpayments will never be required again. Zero down financing was here to stay. Perhaps it will rise to 5% or maybe 10%, but 20% is from a bygone era. Well, go try to get a loan from anyone other than the FHA and see what they tell you. There will always be programs allowing you to put less than 20% down, but good luck qualifying for one of them. From this day forward -- until we build the next bubble -- a minimum of 3% down through the FHA will be the primary avenue of first-time buyers. Everyone else better have 20% down, or you will not be buying.
One of the overlooked features of the bottom of the market is the difficulty in qualifying for a loan. Prices drop because buyers cannot get loans. When prices look relatively cheap, very few people will qualify for loans to take advantage of the low prices. That is why prices are low. If everyone could qualify for a loan, they would bid prices up like we saw in the bubble rally. The future of Irvine's housing market is going to be a lot of loans at the conforming limit -- currently $417,000 -- plus whatever downpayment people have saved. The median will probably be supported at around $430,000 because that is the conforming limit plus 3%. If you have saved 20% or more, you will be one of the few buyers who can bid higher, and you will likely find some outstanding deals at the bottom. Those $900,000 homes at the peak will be going for $500,000 for the conforming limit borrower with 20% down.
