I’m wondering, am I blind or does the information sheet on each of the featured properties purposely exclude the HOA fees for each property.  I always look at the HOA fees of the featured property and with the new property format I can not find them.  Help!  Where do I find them in the new format?

I live in Lake Elsinore and would love to live in Orange County.  However, the home prices, county taxes, mello roos, and HOA fees make it impossible to even consider living in Orange County if I want to have any money left over for retirement.  I guess we’ll all just suppose to live for today and not worry about getting old, somebody i.e. the government or Wall Street will make everything alright, right?

Another question I have is how do all of you stand living like rats in a box (Crowding into the Behavioral Sink)?  Are there any properties in Orange County that are 1/2 to 3/4 acres that don’t cost $1,000,000?

My husband hates having to drive to work but I can’t stand all of the people in Orange County and now they are taking over Lake Elsinore.  We have water problems, air quality problems, land mangement problems, and over population problems, all contribute to a poor quality of life.  When do we say enough is enough and stop building?

Considering $100K is pretty close to the median income in Irvine, that $380K max purchase price is pretty sobering.

I see NIMBYism is alive and well in L.E.

You can’t stand people in OC?  Really!  I grew up on a farm just north of Bakersfield and find people to be about the same just about everywhere in California, bad ones and good ones everywhere. 

Maybe you need to pick better friends?

Today’s featured property must have dropped off the MLS last night, so you won’t find much there today. If you go to a different property, you can find the HOA1 and HOA2 fees in the property details.

I doubt 100K is median.  Almost every family in Irvine is dual income to support the WTF home prices.  So my guess would be 150K or above.  People like me who do not have dual income and hence screwed.

Irvine Demographics

While I agree that having a good story on emergency cash reserves is an essential and neglected part of making a housing change, consider making that number six months net income rather than six months gross income. If you lose your job, you won’t be paying the taxes that make the difference between gross and net. You may also have unemployment compensation coming. One could reasonably meet one’s minimal obligations for nearly a year on six month’s gross income, when tax savings, belt-tightening, and unemployment compensation are considered.

I had to do that in 2007, and we made it through. Even managed to execute a previously planned vacation successfully. And that’s about the savings hit we took, relative to total income.

LMAO. You know, we do have a census bureau, and they do actually keep track of this stuff.

http://factfinder.census.gov

Median per capita: $41,043
Median household: $91,101
Median family: $108,354

“When do we say enough is enough and stop building?”

When we adopt China’s one child policy and stop immigration. Then in maybe 20 - 30 years, after the baby boomers have died off, half acre lots in OC might be more affordable. Less people = lower prices.

By the way, I am not advocating doing these things, just answering the question.

Amelia: “I live in Lake Elsinore and would love to live in Orange County.”

Amelia: [rant about life in general, blaming it all on Orange County]

No, that’s not schizophrenic at all.

Amelia: “Another question I have is how do all of you stand living like rats in a box”

We don’t see it that way. There are trade-offs to any living arrangement. We are willing to trade expansive living space, large homes and lots, and some privacy for infrastructure, amenities, low-maintenance living, convenience, and shorter commutes. You’re welcome to stay in LE if you don’t value these tradeoffs.

Amelia: “Are there any properties in Orange County that are 1/2 to 3/4 acres that don’t cost $1,000,000?”

You mean, aren’t you entitled to exactly the house you want even though you can’t afford it? Weren’t you just ranting about the gov’t, society, Wall Street, consumerism, and all of the other shortcomings of our society? I see all of them in you.

Amelia: “My husband hates having to drive to work but I can’t stand all of the people in Orange County and now they are taking over Lake Elsinore.”

And yet, you “would love to live in Orange County”. I, for one, sincerely hope that you are never able to live in Orange County.

-Darth

I think she’s talking about the number of people (i.e. all of the people) in O.C., not the type of people. That’s how I read it.

The US SS and Medicare systems have increasing benefits that require increasing number people and tax rates to do the current payouts.  Otherwise the systems will go belly-up.
So the system will need increasing population growth (babies or immigration). 

The US has plenty of land to build houses.  It just that the employment centers are not even distributed.

No_vaseline, the medium price house in Irvine is like the lower middle class has in the midwest.

You would not enjoy the places you could afford in Orange County these days.How about being happy where your at for the time being and thank your hubby for making that drive in order to support you? If you have free time use the internet to research not only Orange County but other states which offer cheaper living and more bang for your housing money.As for disliking the residents of Orange County,don’t forget that our beach cities play host to thousands of your fellow Inland Empire brothers and sisters each weekend with the resulting chaos and problems they bring with them.

My guess is that you were not born in CA….  Well, I was..  If you don’t like it here.  Get the h3LL out!!

Sounds like you have that part of your life under control.So whats bugging you?

You’re welcome. I also hope “your kind” stays on your side of the hill.

When using demographics numbers to determine the “correct” median house price, don’t forget about renters. They are part of those demographics numbers, too. I am one, at least until we save up a down payment. Also, don’t forget that 20% isn’t the maximum down payment. As the down payment rises, the loan amount on any given house decreases, thus allowing for a higher max purchase price. In fact, that’s pretty much move-up housing in a nutshell.

-Darth

What happened to the reverse calculation where you enter the rent amount, a percentage (like 18%) and it outputs the equivalent house price?

That was useful.

Suggestion on your spreadsheet:

$100k gross annual salary equates to around $70k net (pretty liberal considering % to taxes/SS, 401k, insurance)

So that six month cushion at the end is really ~$35k, not 50.

Dr. Housing Bubble had a great blog on shadow inventory. However there was an interesting counterpoint from “Sammie” (snippet below). This scenario is bad news for people who are waiting. Any thoughts on this IR?

http://www.doctorhousingbubble.com/shadow-inventory-case-study-inventory-in-the-shadows-twice-as-big-as-normal-resale-inventory-in-los-angeles-and-not-on-the-mls-or-for-public-viewing-foreclosures-and-distress-properties-clogging-t/

“I’ve read claims that banks must quickly dispose of REOs, but I doubt it. They can dispose of REOs into their holding companies. Or, they can get FASB rules changed or get more money from the Fed to get around this limitation.

I think putting REOs into a holding company is the most likely option. Billie deSpain, my friend and veteran realtor, managed 500 properties for a bank holding company in the 1980’s. Glenborough Holdings was spun off from American Savings & Loan. She hired a handyman and housekeepers, and oversaw each house from eviction to rental to final sale. The homes were in the most prime southern CA real estate markets, in Laguna Niguel and surrounding coastal areas. After the market turned around five years later, Glenborough put the properties on the market, twelve at a time. It is likely banks are going to do this again. It is financial suicide to dump REOs on the market, so why would any corporation do so? ”

I guess you can’t count on the REOs to bring the prices down.  I am watching for the tightening of lending standards and higher interest rates.

Thanks for the info.  Now what is the would be income to support the median home price in Irvine?  Does anyone has that data?

According to the link supplied below, average Irvine income is $98K, and average house value is $697K.  (I know this isn’t comparing medians to medians, but it’s what’s in the website and an OK ballpark.)  If $100K income supports a $380K house price, as IHB says, and we take straight proportions, then a $697K house requires an income of about $183K.

So Irvine’s average house value (according to the Irvine City website and subject to being outdated information) needs to fall by 50% to be supported by the local incomes. 

So, assuming that household income remains stable, Irvine’s average house price needs to fall to $380K.  With increased unemployment, it has to go lower.

Patience, everyone.  Unless HELOC is available, prices have to fall to a level where they’re supported by actual income.

So does this mean, after 5 years my salary is going to double from my current level?  If prices are to maintain their current level after 5 years, what should be the GDP growth necessary to achieve that?  Can someone please explain because its not making any sense how banks can hold onto these REOs and expect govt to bail them out?

Please forgive my ignorance, but when I pull up the calculator, I can hit the edit button, but it says I don’t have permission to view this page.  I’m using Firefox for Mac or Safari for Mac.

Please help.  Thank you.

I’m surrounded by people who convinced themselves we hit the market bottom.  Allot of them are like my girlfriends mom who is retired, has cash and in a panic to buy before prices return to 2006 levels (In her opinion).  With low inventory, low interest rates, high DTI loans and anxious buyers, current house prices may be supported for a while.  I agree with Brea, until interest rates rise, lending standards tighten, and inventory increases, prices will be slow to drop. 

I was interested in buying a house this last spring thinking it was a depressed market.  After tons of research, attemtps to buy and reading IHB it became apparent prices are still inflated.  Not to mention the banks were willing to lend me far too much money (Some where around P DTI).  I have friends who kept going back to the bank and asking for more money which they gave them.  Most people buy with emotion and are willing to use every dime lent to them. 

However gravity always wins and prices will fall back to sensible levels at some point.

Wow!  I talk to a lot of people in Irvine.  Most think we are at bottom.  Last week a woman told me we should move back to Irvine.  Like it was safe from the carnage.  And regarding the price drops in Riverside, what else would you expect.

I think she was also suggesting your kind stay on your side of the hill also.  Since it makes more sense to by out in IE rather than OC due to the earlier drops here.  We may see more commuters makeing our lives harder.

I have also seen country roads turn into six lane speedways with screaming driver.  They move here for the prices and then it takes awhile to appreciate of more relaxed pace.

Rents have come down and will have to continue this trend for another housing correction.

So far, it appears to be happening everywhere.

With each month of increasing unemployment numbers, don’t expect rent price to stabilize (and that goes for housing price as well).

I love the way that people so easily characterize people as ‘the other’—here we have people from OC and IE bashing each other ad hominen in a hate-fest.  It isn’t that IE is getting crowded because it is less expensive that OC and LA, it is the fault of all those bums from OC clogging up IE’s beautiful roads, making it impossible for the REAL IE residents to get to their jobs in OC.  I may be picking on her and not the OC crowd, but, to be fair, Amelia from IE started it by bashing the OC (and I still don’t understand what her point was). It’s not like the people across the county line are any different.   

“The Nazis made the Jews wear flair, you know.”

Aaah.. truly a Darth Vader reply.

I agree, btw.

BTW- an old coworker of mine bought 100 acres in the middle of the Mohave unseen.  Dirt cheap… it was dirt with a dirt access road.

First time he saw it was on one of our test flights out of Edwards AFB.  He gave the pilots the location and we saw it from 10K feet using GPS.

So, yeah, there’s cheap land in California still, but you’ll need a 200MIL aircraft _plus_ crew to find it. 

$108K median family?

That number always amazes me… How in the world can have been be $1++MIL homes in Woodbury, Portola Hills, Columbus, etc…???

I guess when you pay no money down and have a 1% teaser rate the sky is the limit, huh?

Especially since we all know that the real enemies are those dirtbags in Phoenix.  I dare one of them to show his face around here!

Yep, I see that land all the time. I was born and raised in Redding, CA, so I have the pleasure of driving 10-ish hours from Irvine to Redding a few times a year for holidays, etc. (Company car+gas compared to the horrible flight connections into Redding don’t make it worthwhile to fly.) I’ve also driven to Vegas a lot for work, and I’ve also made a few driving trips to/thru Calexico and Yuma, AZ. Other miscellaneous trips throughout the state…

There’s A LOT of empty and cheap land in California. Every time I hear one of the SoCal (or East Coast) city-born talk about overpopulation or running out of land, I shake my head in amazement after picking my jaw up off the floor. Add onto that the vast, untold emptiness in flyover country (had several jobs in OK, TX, NE, & MO lately), and we are nowhere even close to running out of land or overpopulating. Increase our population tenfold and we’ve still come nowhere close.

Granted, we might be running short of the more desirable parts of the country… Or, at least, the most hospitable, weather-wise.

-Darth