WOW!  THE CITY OF IRVINE!  LIVING THE ORANGE COUNTY LIFESTYLE!  FOR ONLY $379 PER SQUARE FOOT!

Sorry, had to.

And not that my opinion has any value but this seems like a decent candidate for a $475k home (without seeing the inside or knowing more that’s a real stab in the dark and a fairly generous one at that).  I can easily see, in a world of $100+ oil an economy that would barely support that price.

And yes, as IR pointed out, five years of “growth” wiped out in the blink of an eye.  That said, I think we have to begin to ignore all of the ‘00 years “growth”.  It was artificial and unnatural if not unsustainable in real terms.

I would guess that someone would jump on this for more than my estimate given what Irvine props sell for.  And yes, the 2003 buyer grossly overpaid in my opinion as well.
——-

It’s a 2003 rollback even if they get the asking price - 2% over a midsummer price is still a 2003 price. But I agree $379/sq. ft. is a really high price for a 20 yo property in midsummer 2003. That’s 3 years before the peak. Were peak prices per square foot really $500?

There has been some name calling and negative personal characterizations in the comments lately. This must stop. We can all have differing opinions, and we can share them here without fear of denigration.

Thank you,

IrvineRenter

Sorry about the additional post but one more personal pet peeve.  Here we have someone trying to sell a home, a home priced at almost three quarters of a million dollars with one picture of the outside taken with a cell phone.  Seriously, are these realtors that dumb?  We all know that they’re not that busy these days (unless the realtor is selling REOs).  Hilarious.  This wouldn’t fly on ebay yet on MLS it’s standard operating procedure.

I’ll never get over that.

If I were the bank, I would certainly be taking a look at the appraisal I based the loan on. There probably were comps in the $500/SF range. We have seen plenty of WTF asking prices over $600/SF.

Given that the home sold for $375,000 in 1998, and assuming the house would rent today for about $2,700, the $475,000 estimate of value is pretty close, IMO.

It sure does make my day to see train wrecks like this one.  I hope the family found a nice rental within their means, and I hope the bank losses a lot of money on this deal.

What is the best strategy to negotiate with the bank on REO, besides waiting for lower asking prices?

Partly OT, but here’s a post from Piggington saying the banks were waiting until the new year to start their fire sales and the fire sales are starting now: http://piggington.com/repo_pricing_banks_going_for_the_throat Data is from Temecula, but asking prices are back to around 2002, one at 37% off peak, one at 20% off 2004.

I often wonder if this blog has a connection to Al Qaeda. That is the only thing I can think of that would explain all the anti-free-market views espoused by the members of your special interest group. The government should not allow your continued attacks on the economy and should institute a minimum price of $500 per square foot for any sales transaction involving a single family home. People who break this law should face prison time for attempting to undermine the laissez-faire system that has served this country well for many generations. This particular home would sell for at least $944k if speculators like you people weren’t driving the market down.

I agree with Ice Weasel.  We all know the NAR’s economists are delusional.  However, if the NAR or MLS wanted some professional standards, they could specify minimum photo resolution, number of photos, and make their software use spellchek.

Cool - I’ll take 5 square feet!  That should be enough room for me to stand and enjoy the wonderful world of Irvine!

I agree wholeheartedly. The problem really stems for the secularization of our society. People were much more civil when they were taught to fear the wrath of God or perish. But, what did you expect? You run a blog that denies that the invisible hand of God is involved in the market. Worse, you slap that hand when you subvert God’s will by driving the market down with your “bubble” rhetoric. I would be willing to bet that you would be against having the 10 Commandments printed on all loan documents and property titles. What a great irony that you complain about the problems that you, in fact, helped create.

This realtor specializes in REOs ice w.  He’s probably got all the biz he can handle right now…

The idea of specifying minimums like you suggest smacks of socialism. People don’t need a nanny telling them how to list their properties. Let the market work and leave the tyrannical policies for France.

Paul/Huckabee 2008!

BTW, misspelling of “spellchek” is intentional.  It’s yet another one of those irritating errors I’ve seen repeatedly.  The best was a personals ad from an “Englis teacher” who was looking for someone who was “intelligant”.  And no, her photo was not high-res, brick house, smokin’ hot.  It was a WTF personal.

About 9k in annual property taxes if someone buys it at the asking price. Thats $750 per month just for property taxes.

That’s why 700k used to be a price that the upper crust would pay for their upscale homes.

This is just a nice small, somewhat brady-bunch-looking house that a young middle income family should be able to afford. I agree with that 475k figure.

I am sure it will sell for more than that because there are still some potential buyers that are not willing to wait a couple more years.

BTW, whats up with the agent? Was he afraid to go inside and take some pics? It has a pool, why not take pics and show everyone?

Hey Kirk!

How come you’re not in Oklahoma helping Timmy?

Banks can’t afford to book to large of a loss because the negative effect on their books would make them insolvent.  They will stall on the downside and hope for a soft landing in order to maintain their liquidity.  Some, in particular WaMu, are postulated to be deep into subprime to survive.

The issue seems to be one of ego’s.  Just like you predicted,  people do have egos tied up with paying high rents for their spot in paradise or prices so high for their house in paradise.  When others point out that these prices are unsustainable, or that rents nearby are lower, ego’s get bruised and comments get made that shouldn’t.

Propose your idea to the Irvine Company. I imagine they would lobby for it.

Kirk, chill dude.  Would it not be better for our capitalistic society for people to not to drive themselves into debt so deep they will never get out to purchase a depreciating piece of property? 

Let’s face it, cars depreciate fast, so people rent them (lease is a fancy name for rent).  That’s smart.  Housing is depreciating, so smart people will rent them.  You wouldn’t stick your cash in a falling stock, so why put it in any other property that is plunging?

Besides, if we don’t drive ourselves into debt for a quickly depreciating asset, we (as a country) will have more money to invest in productive assets.  Maybe then we won’t have to sell our country’s iconic institutions to Middle East oil barrons and the communist Chinese government just to raise some cash.

NAR’s economists ARE NOT delusional.  They are paid by the NAR to say what the NAR wants, just like any other marketer.  If they didn’t say what the NAR wanted, they wouldn’t be hired.  It may be unethical but it’s not illegal.

Ideally, economists would be required to have some national standard association which could sanction members unethical behavior.

Alan - I don’t think they are tied with egos at all.  You and a couple others keep insisting that IPO is unrealistic (some are even calling him the next truthy) but give no reasonable expectation why rents will fall.

I have no ego tied to this city let alone this county.  I grew up in a real LA city zipcode and would love to move back any day of the week.  My wife grew up here on the other hand and doesn’t like LA much at all.

In any case, I will be glad if my $1900 IAC rent for a 2b drops but I am not expecting it to with all the information we have presently.  I certainly am expecting house prices to come down greatly.  My calculations put it around $225-250 a sq ft depending on lot and upgrades.  So at a certain point, I will have to decide if I want to continue renting my smallish apt for close to $2000 or buy a house. 

You, shiny, etc have constantly stated that incomes can’t support rents but people seem to keep renting in IAC communities.  Hence, please describe the reasoning and don’t simply say the rent-to-income ratio is off the charts.  IAC won’t rent to anyone that doesnt make at least 3 times the rent so the majority of households in IAC communities aren’t on any killer rent-to-income ratio.

If rent of this one is $ 2700. I will take market value around 575k after two   years, 2010.  By then, American are going to back old standard, 10% down payment,  20% just too hard for average joys.

Kirk:  if want a healthy economy, then you will appreciate that overemphasizing a particular asset class is detrimental.  Trade between nations creates wealth, combined with productivity increases.  Worshiping at the House of Orange County only leads to the disaster blossoming around us:  the religion of stucco-ism leads to defeatism. 

It is a classic example:  you have apples and I have oranges.  If we trade some apples for oranges and vice-versa, our wealth increases.  Each party benefits and is better off than before.  That is how OC will boom, through trade and productivity (each party increasing the number of apples/oranges they have available to trade with the other party). 

So the implosion of this real estate bubble is ultimately positive because we can get back to work in endeavors that will lead to wealth increases.  It is not “wealth” to endlessly speculate in just apples.  There is no future in such schemes.

It is hard to figure out what the banks actually think home prices are at this point. When you here of the investment houses and banks taking billions of dollars in write downs, they must be based on some logic and the value they think their assets are worth.

Yes people do seem to be overextending thenselves to rent IAC apartments for the present.

Apartment rents are determined by supply and demand, not what the next door building is renting for.

Long term, spending 40% of your income on rent is not sustainable, that’s indentured servitude.  28% of the median household income for Irvince is where sustainable rents are going to end up.  My opinions are for the long term 5-10 years.

Once the real-estate bubble ends and incomes drop, which I anticipate as real estate, lending and construction softens, then vacancies will start to rise and apartment owners will drop rents to keep units full.

Private properties with WFT asking rents that are vacant for 6+ months without a tennat ARE NOT asking market rents and no amount or arguing can say they are.  If they were asking for market rents, they would have been rented.

My logic tells me this place is worth about $360,000. Again, that is if the buyers are required to have a down payment to purchase the home. This is a median home…...1900 sq ft. tract. For the consumer/dept economy of Irvine saving $72,000 or even $36,000 is a huge amount of money.

The housing market valuations will depend more on down payment requirements than any other factor in the next 5 to 10 years. Interest rates are a secondary factor at this point.

OK Irvine Renter:  how about this:  gee, ipop/rkp, your bullish dreams of closets renting for 3K a month are unrealistic.  But I appreciate that the good Lord was parsimonious with IQ distribution.  These things happen.  No harm, no foul.  This is a democracy, we all get just one vote.  I don’t mind wrongheadedness, it all part of a divine plan.  So you see, everything is flowers and candy, peace, love, and happiness.

Alan,

My posts, at least up until shiny’s attacks, have nothing to do with ego.  I do take some joy in a spirited debate, but won’t lower myself to his name-calling, etc.  I told you a few days back that I would chill out on that and I will stick to it.  I went after shiny because he blasted me for have the opinion that I think that Woodbury place could rent for $2900 today when 1) it has rented for that much according to Zovall and rents have gone up since then, 2) based off MLS leased prices and IAC rents, $2900 today for that particular unit was very possible and 3) he has a fallacy in his reasoning with regards to what he pays in Westpark vs. what others pay in other places.

How in the world could my ego somehow be tied to rent values in Woodbury?  I own in West Irvine.  Have owned for years.  I’m looking to buy-up so any property declines benefit me.  I won’t be renting out my place as I think its silly to hold and rent if you can just buy back the same property later at a lower price for investment purposes.  My mortgage, taxes, insurance, etc. are far lower than that $2900 rent in Woodbury or equivalent rental properties in my neighborhood.  I have every motivation to agree with you that the sky is falling but I simply can’t ignore what transactions are saying about the market.

Yesterday I posted 27 leased condos and townhomes from West Irvine with an average rent around $2600 for 1600sf.  That tells me, and I suspect many others, around how much things rent for today.  Absent other catalysts to drive those numbers down, which very well may occur, those are going to be the rent rates of tomorrow also.  Again, I have no vested interest or stake in Irvine rental rates.  Just simply trying to pass along some information to correct some misconceptions…

I’m not particularly keen on bankruptcy law.  If a bank is insolvent from a balance sheet perspective, i.e. liabilities exceed assets, do they need to file for bankruptcy?  Can they stay in business if this is the case even if they can continue to meet all financial obligations?

your own position undermines what you say:  your (deductible) mortgage payments are “far lower” than $2900. 

My point is that I live in a very different reality:  I write a non-deductible check for 3K every month.  And it is hard to do so even with an income north of 300K.  I have direct experience with this, I live it. 

So when I see 1600 sq ft boxes touted as being worth 2900 a month, I know that is wrong/unsustainable.  It is simply a reflection of what Irvinites came to believe as “normal.” 

That thinking, that 700K and up is normal for middle class dwellings in a godawful plasticky community of monotonous sameness and dullness replete with immigrants wearing welding helmets while driving (OK, the welding helmets are rather amusing and alleviate a bit of the dullness) is what lead us down the road to this unfolding disaster. 

Personally, I find a blog monotonous when everybody strokes each other with the same ideas, commenting on how “wonderful” the discussion went—what discussion, you were are striking the same notes.  yes, name calling is ultimately childish but that is our way:  look at the presidential campaign, mudslinging is a deeply rooted part of our culture.

From my recent personal experience George, there is little room to negotiate with the banks.  Those determining the property value are seriously disconnected from the properties, neighbhorhoods, etc.  You just have to keep going back at them and maybe catch the bank’s deciding authority on a day when they feel like they need to move some inventory.  Here’s an example:

http://www.redfin.com/stingray/do/printable-listing?listing-id=1124715

Owned by Wells Fargo.  Once upon a time I thought I liked this three-story design (not any longer) in Northpark Square.  Small lot but in a pretty good location very close to small park and the big common area in NP Square. 

They brought this on to MLS at $979K when the same floorplan had recently sold in West Irvine for $880K and others just like in NP Square were listed in the mid to low $900K range.  I was thinking they might be willing to move it in the $800s but they wouldn’t budge out of the $950K territory.  If they would have, I might have caught that knife and paid $850-875K for it.  I think it will sell in the low $800s finally assuming they are now more realistic about accepting a market price.  The price drops do suggest that is the case…

That’s when the fun starts.

What was that saying “may you live in interesting times”

08-09 is going to get very interesting

“check for 3K every month. And it is hard to do so even with an income north of 300K. I have direct experience with this, I live it. “

Um north of $300K would put you at $25K+ per month gross.  Even in California, that puts you near $15K take home.  $3K of $15K is 20%.

If you have difficulty making a housing payment based on 20% of take home pay you obviously have some other money issues going on. 

Living wage proponents use 33% of gross income for rent as their guideline.  Housing advocate groups use the same.

Properties over $2500 in OC tend to rent slower, but they do frequently rent.  Irvine has higher rents than the rest of OC.  $3000 places do rent.  They rent.  IMHO, some if not many in Irvine are literally living themselves into the poor house by choosing to live in Irvine.  The blog has covered this SoCal cultural phenomenon before. 

Will Irvine rents drop?  Maybe, maybe not.  I suspect they will have increase pressure downward.  However, if Irvine and the core South Coast Metro area continues to be the job hub and traffic congestion continues, for rentals, it place increased upward pressures.

having said all that about how boring it would be if all this blog comprised was like-headed bloggers spouting similar comments, I gotta hand it to my bro Alan:  Hear, hear, he speaks the truth.

What I pay as an owner has nothing at all to do with what others pay to rent my same home.  What I pay is a function of how much I put down, my mortgage interest rate, when I bought etc.  It’s a confluence (is that word?) of factors over an extended period of time that produce the economics of my housing expense.  Rents are about supply and demand at a particular moment in time.

I’m sure you don’t believe that MLS data I put up yesterday, with 1600sf condos in West Irvine with an average 2007 rent rate of $2600 or so, but I think that is a much better indicator of what the market TODAY is vs. your personal rental situation.  How do you rationalize that almost 30 places were rented at $1.60 per sf while you pay $3K for 2400sf?  Most of these places were attached, no yards, etc. and yet they seemingly pay only $400 less than you for 800 less sf.  Is it possible that rent rates differ by area in Irvine for some reason?  Is it possible people pay more for newer places?  Of course it is, because that is how markets work.  I know, I know, show you the leases.  How about I go door to door this weekend and confirm with the renters that they are really paying these rates.  Will you believe it then?  Probably not I suspect… 

Is it unsustainable, I have no idea.  People are paying the rents today somehow.  Maybe they are living off credit cards, but I won’t even try to guess about that.  When personal BKs start spiking seriously in OC, I’ll agree with you that these renters are living above their means and rents are likely to come down.

Leasing the most quickly depreciating period (ex. first few years of a new car) over & over isn’t exactly smart.  Obviously it’s better to buy a car outright after most of the depreciation has already take place (ex. a few years old - now just transportation, not status), and drive it for many, many years until it dies.

Kirk,
What makes you think that God’s will is for prices to keep going up indefinitely? Do you think God’s thinking, “I wish that hadn’t happened?”  If you think God isn’t in control of all things, then you don’t know the God of the Bible.  Someone once said that God cares more about our character than our comfort.  I hope that whatever RE loss you are experiencing, that you ask yourself what God is trying to teach you.

the money issue I have is this:  you pick up a pen and write a non-deductible check for 3K every single month.  you will see what I am talking about.

What they said.

The banks don’t negotiate. We bought our first home as an REO. Made an offer below asking which was rejected. Two weeks later the bank lowered the price and we submitted our identical offer, which was then accepted.

They are playing to a script.

“Let’s face it, cars depreciate fast, so people rent them (lease is a fancy name for rent). That’s smart. “

Excuse me while I laugh.

There is a big difference between Leasing a house and Leasing a car.

I was in this house in 2003. It is very unique for Woodbridge in that it has its own pool in a beautiful setting. Entry fountain, end unit. Very private (if there is such a thing in Woodbridge).
The interior has a gut remodel with antique french finish on kitchen cabinets and espresso bar in FR. The remodel was 9 (out of 10) for homes in this bracket within Woodbridge. Other than being 4 bedrooms in about 1800 SF (which makes for small bedrooms), this is a very appealing home. It is also outside the loop and oriented near 405 so it has constant background freeway noise.

I don’t believe asking prices that havent’ changed in 6 months are valid market prices.

I’m renting my condo now in HB

I checked comparables last year, posted a price, had several people look at it, no takers after three months lowered the asking rent, lowered it again, eventually found a tennant.

Please keep up the good work ipoplaya, don’t let some new reader wishing that he made $300k a year but can’t even comfortably pay $3k a month in rent bother you. I enjoy reading your comments, and agree with your thoughts about rent.  In fact, I was about to ask IrvineRenter a question last week when he posted his updated charts, asking him to further explain why he felt the median rental price in Irvine was $2250 (lower than my gut feeling) when he answered the question for me out of the blue.  The answer was that his median is a 3br condo, which explained a lot about the differences.

Banks are regulated by several different government agencies.  If banks cannot continually take losses every quarter or they can be forced to shutdown.  It’s scary, because when a bank buys the home back from itself, no loss has been applied to the balance sheet. The mortgage note appears to be paid satisfied and now they hold the home on its balance sheet as a non-performing asset.  They do not take a loss until they sell the property.

Do you know how much money is already tied up in bank owned properties?  The amount is staggering.  Countryfried has over 3200 properties in CA alone, and this is just what is disclosed on the website.  If the avg home price is 425k, that means they have 1.36 BILLION in useless property value in California alone.

I used to live around the corner from this place 1993-1997.  We knew the family that lived there, their daughter would babysit for us.  I am almost certain that this place does not have a pool.  The REALTARD(r) is probably referring to the adult only pool adjacent to the house, which BTW used to be 24 hour until the 1998 buyers complained to WVA enough to get it closed at 10pm.

BTW; when we left that house on whistling isle we paid $1475/mo rent.  It had 4 beds and 3 baths.

again, one thing that kills me about these blogs are the posters who become possessive about the comment section(!), as if they had some vested property right in it. 

I am not new, I have posted under a variety of names long before you Johnny-come-latelys showed up. 

oh, that shiny doesn’t belong here, he hasn’t drunk enough koolaid, why he says Irvine is dull and boring.  that’s crazy, one billion Asians are dying to live here so we can all stop working and rent our stucco boxes for umpteen thousands.  don’t mind him ipop, he is just wrong, wrong, wrong.  we loves you, what flavor koolaid do you drinks?

Oh, and relating to yesterdays comments: We had to sue to LL to get our deposit back. 

We were paid up until the end of the month, moved on the 11th, found her new tenants that moved in on the 15 and also paid for that 2 weeks, and she would not produce any receipts substantiating her expenses.  She paid once she got served.

ASSUMPTION:  375k price is accurate on a fundamental level.

6% annual appreciation for 9 years puts the nominal value @ 633k.
——this is double the avg rate of inflation and greater than a 30 year     treasury bond

4% annual appreciation for 9 years puts the nominal value @ 533k.

Historically, including that last 7 years of insane price inflation, the avg rate of apprecaition of SoCal homes for the last 50 years is less than 4%

Nice Shiny…

Alan - I totally agree.  WTF asking prices do not indicate true rent.  My in-laws have owned a second house in the Orange hills area for over 10 years now.  It is a 2500 sq ft house on a 5000sq ft lot and in great condition.  My father-in-law isn’t a slum lord

I will get all the rental rates from him tonight but I know that they were getting between $2700-2800 pretty much all this decade.  After years of lucrative rent, my father-in-law had to drop the rent to $2600 and use a RE agent in December so I agree that rents are falling albeit very slightly and only on the larger properties.

Shiny-  you think you make the comments section interesting but I disagree.  You just make gross generalizations and contribute very little to the discussions.  I am glad we have differing opinions or the blog would be a waste of time.  But you simply say we are wrong or dumb or jaded but give no logical explanation.  The comments section is normally interesting and full of intelligent debate.

Also, whats the deal with the $3000 a month check being difficult.  I make less than you and have no problem what so ever having to write that $2000 check.  You stated earlier that your wife has health issues and I am sorry for that but you have to agree that without those expenses, the $3000 check would be a breeze.

One thing that kills me about these blogs are people like you that bitch about them but continue to read and post on them at the same time. 

If you don’t like the show, change the channel.  If you don’t like Irvine, move to CDM, Newport or Laguna if you love them so much.  If you don’t like the blog, just forget the URL.  It’s sad to see people like you with free will whine so much about things you don’t like and just keep on doing them…

gross generalizations?  click on reuters or bloomberg if you want “gross generalizations” that this bubble is imploding.  I am old enough to have been there down that before.  I recall the same craze in the late 80’s, buy or forever be priced out. 

But this time it was much worse and became global.  Debt has been leveraged like never before.  No one knows where this will end but it is plain to see it ain’t gonna be somewhere good.  Global competition ensures that wages must stay low yet we are assaulted with $100 barrel oil—cheap energy is our lifeblood in the USA, suburbs like Irvine were created because of it.  So go ahead and stroke each other with your pipe dreams that we will soon have a bottom and go back to endless speculation. 

and yes, I do prefer Corona del Mar, any sane individual would. It is like saying I prefer BMW 335i over Chevy Malibu, it is a no-brainer.  You cannot create a community in a Irvine Co. corporate boardroom, communities are organic.  When you do “plan” a community to the extent that the Irvine Co. did, you get a sterile lifeless result.  But because this bubble caused endless speculation, the moribund experiment that is Irvine became thought of as a bottomless well of appreciation and riches.

I can’t make up my mind if Kirk is trolling, leveling (search the twoplustwo forums for definition), or serious.

Either way - good times.

I am about half way throught Greenspans’ book.  On page 178 he describes how the fed tried to deflate the bubble one time in 1997 and then quit.  But the real gold is on page 175 when he quotes Robert Ruben.

‘Bob thought that a federal financial official should never talk about the stock market in public.  AN inverterate maker of lists, he offered three reasons noted subsequently in his memoirs.  “First, there’s no way to know for certain when a market is overvalued or undervalued,” he said.  “Second, you can’t fight market forcers, so talking about it won’t do any good.  And third, anything you say is likely to backfire and hurt your credibility.  People will realize you don’t know more than anybody else.”

Wow, there’s humility there.

In the end, fundamentals matter and the market sets the price.  But just like when Enron was manupliating the energy markets in 2000 here in California, ‘outside influences’ (in this case, ez financing) can really mess with fundamentals. 

A personal note to Kirk:

If you really think this blog is effecting the settling prices of houses that are currently moving (and there are a few) or violating the invisible hand of God (which I always believed to be unmanuliplateable), secularization isn’t the problem.  You, sir, are truly in bad shape and need to seek professional help - or a basic sales course where they explain that market prices are set by a willing buyer and a willing seller.

I will have to agree with shiny, people have become accustomed to certain numbers in Irvine. 3000k in rent is alot of money regardless of how much you make. can you afford it on a 300k salary, yes. is it fun to make that payment, NO. 

like a poster mentioned above, part of what I read here is the cultural pathology IR mentioned in one of his earlier posts.

just look at what people are paying to lease cars, 1000 per month is common, you would be shocked when you ask these people how much they make.

I know Irvine commands higher rents due to location, safe, planned, etc but Irvine became one of the biggest bubbles. houses cost half less than 7 years ago.  with local economy slowing down, prices going up(food, gas, health care, edu), WILL PEOPLE BE WILLING TO PAY CURRENT RENT PRICES, that is the 64,000$ question. 

Robert—that’s an excellent point. It’s easy to assume houses are a commodity, that any one is like any other.

Just because houses share similar statistics or a floor plan does not mean they are worth the same.

While the bank may take possession of the house, the FMV of the house may not be the amount that was due on the mortgage. Then they’ll take a writedown on all their assets. They can play with these numbers and wait a bit of time before wirting them down, to manage earnings.

http://www.redfin.com/stingray/do/printable-listing?listing-id=1124715

Woo, on redfin for 113 days!!

Countrywide is listing more like 3750 foreclosure properties on their web site in CA right now.  They blew past 3200 back in the late summer…

Is this dood serious? Have any of you looked at his website?

ipop: in the same vein, if you don’t like my comments, don’t read them.  I happen to know I am witty whether you recognize it or not—many have said so before you.  so there, I am a wordsmith and you are not.  nyah nyah nyah.

I don’t think they’re going to go much lower on price for a while.  They are sitting right at loan/book value after commissions with a price of $839K. 

I think this place could be had for a smidge over $800K if someone got their buying agent to do a cooperating broker agreement at 1%.  Almost $300 per sf at that price in a fairly new area of Irvine is a nice price decline, probably 20% off peak pricing I suspect.

“I was in this house in 2003.”

Thanks for that info. Wow, its amazing that we have people here who not only know the area, but have been inside the house.

I sure hope the place did not get trashed inside.

Anyway, I have seen homes in certain areas get a couple of hundred grand in upgrades and it made no difference in sales price. Its all about location, incomes and the old supply/ demand equation.

lendingmaestro: Countryfried has over 3200 properties in CA alone [...] If the avg home price is 425k, that means they have 1.36 BILLION in useless property value in California

The homes aren’t worth zero. It means Countrywide’s mortgagees have 1.36 billion in assets. That is not the same as the value of Countrywide’s loans, and it doesn’t say anything about the mortgage default rate, or the homes foreclosed on.

And banks’ accounting rules are far different from what you think.

Hey Shiny, I feel for ya. I think it would hurt, too, to write a $3,000 check, no matter how much you make. Wanna make it hurt more? Get that $3,000 in 20-dollar bills and pay your rent with it.

How about all you renters and mortgagers go pay your next month’s payment in cash?!? Then you’ll really think WTF!! I’m giving out all this cash for what? Or better yet, calculate how much time it takes to earn your rent or mortgage payment and figure out how much time you actually consciously enjoy your home?

On a different note…so we mostly agree that supply and demand help to set rental rates Why then is the equilibrium point set at such a level as it is in Irvine? That’s the better question.

Some corporations don’t align their fiscal year with the calendar year. ... So January 1 might not have any special meaning for their balance sheet.  Just sayin’.

I’m not whining about this blog or your comments.  I don’t mind your posts much, except for the racist undertones or in some cases, overtones. 

I think your posts are entertaining in general, albeit childish on occassion.  You are correct, you are damn witty….  I’m no wordsmith.  Good accountants usually aren’t. 

There will always be people like you that are so self-centric or self-oriented that they can’t see the forest for the trees. e.g. because I pay X, no one can or will pay Y, but I expect the good many lurkers here take your posts for what they are worth.  More conjecture and fiction vs. fact and analysis.  Not that conjecture and fiction is bad, it adds color to the discussions.

Following up on myself… An interesting link on Countrywide:

Countrywide offering 15,150 REO properties

http://countrywide-foreclosures.blogspot.com/2008/01/15150-reo-offered-for-sale-on.html

what?

Interesting discussion on rents here

http://lansner.freedomblogging.com/2008/01/02/oc-rents-eyed-to-be-flat-in-08/

How is a private association that sets standards for its members to follow socialism?

Lay off the go pills, dood.

$533k may be the expected support level in a normal 4% apprecating market.

But bottoms in downturns overshoot support levels, and the amount of overshoot is not predictable in advance, it’s a function of how much oversupply is on the market and how desperate sellers are in clearing their inventory.  It looks like the oversupply will be quite large so this property may pass below $400K at the bottom in order to sell.

Kirk,

Socialism - a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole.

So get your f’n shiz straight! Setting rules is not even close to what socialism means, you twat!

It ain’t the houses, it’s the land!

I think we all post here because we all have ideas about what’s going to happen in the future, none of us has a crytal ball so look to others to find some common thinking so we can plan on what we need to do.

Yesterday, IPOP was arguing that rents will stay stable or rise because OC has a large stable job base of 1.7M and posted a pdf to prove it.

I look at those same numbers and see big trouble ahead 160k OC jobs (10% of OC’s jobs) are state or local gov jobs, now with 14 billion dollar deficit in the state for 07 and immeadiate 10% cutbacks and larger deficits need to be closed in 08 a number of those jobs will have to go away.

100K jobs in construction where you can expect at least a 20% hit in the next 2 years.

Real estate and finance jobs at risk.

Thats why I think the party’s comming to an end, some people wouldn’t acknowledge it till it’s over.

Yeah, when a willing buyer and seller consummate a transaction. That’s why I love it when people talk about how much they think something should be worth and really want to ignore how much they could actually sell it for.

Hello, I’m a IHB lurker and now poster.  My brother and his family live in Irvine so I keep up on property values and rents there.  I currently live in San Francisco and rent an older house (1940s) in an OK neighborhood (Sunset) for $3200.  It is not the Victorian style common in SF, but rather a drafty, overgrown cottage style w/about 1700 sf.  The street is tightly packed and, while the adjoining properties do not technically share a wall it feels and sounds like they do.  My rental property and neighborhood are nowhere near as nice as this house.  So as overpriced as Irvine seems to many readers here (myself included), SF is worse.  And quite frankly I suspect my landlords (who use a management service to collect rents and perform maintenance) are going to raise my rent when the lease is up.  Talk about a tough check to write!  But not as tough as the down payment check to buy the place.  The nicer houses on the street sell (or at least list) for $1 million+.

“an” IHB lurker

Check out the New York City housing market:

http://money.cnn.com/2008/01/03/real_estate/manhattan_prices_up/index.htm?postversion=2008010307

Irvine is a land of milk and honey.  It is fair game to complain about housing prices.  Complaining about rent in Irvine is just senseless whining.

SF and Manhatten ain’t OC.

I’ll have to skip to those pages of Greenspan’s book.  I’ve been reading it, but haven’t gotten that far… I spend entirely too much time watching college football!

Re-read my posts Alan.  Don’t credit me with arguements I did not make. 

I posted the pdf link to refute the notion that a bunch of jobs in OC have already gone away and that this is somehow a current driver to surpress rent prices.  That notion is simply not true.  It may indeed be so in the future, but with a 4% unemployment rate today it’s just not the case.  It is true that we do have a diversified employment base, which does lend itself toward more stability.  No local economy could handle the loss of tens of thousands of jobs without some adjustment… 

I make no real claim as to whether rents will increase or decrease in the future.  I can see it playing out either way.  All depends on the macro-economy IMO, not the real estate bubble deflation.

Hi Jeff. I lived in an 1890’s Noe Valley victorian/edwardian/stick flat for ten years. “Drafty” homes are not limited to 1940’s Sunset houses, heh. Windows didn’t fit the frames, no insulation, and only one gas heating unit—in the living room.

Check out http://mullinslab2.ucsf.edu/SFrentstats/

It’s a beautiful way to compare rents in SF, or browse Craigslist listings.

(Anyway, San Fran threadjack over. Let’s get back to Irvine.)

Countryfried CA foreclosures

Wow, Michigan is in the shitter.  Over 10% of CW’s REOs in that state alone…  I knew Detroit was cratering but it’s going to get so much worse for them.

Can I whine about my $421/month apartment in good ol’ Hopkinsville, Kentucky?? I’ll whine! I’ve got base rent of $394 and then they tack on BS charges for trash, admin, and water. Those extras average about $27/month. Waaaa….it’s only got 576 square feet!

(Deleted by blog administrator)  You whine about a 3,000 dollar rent check, and claim to make 300k. 

Yet only a few days ago you were whining about the ‘indignity’ you suffered when all the RE people would make you feel inadaquet about your financial situation.

Something doesn’t add up.

At least I won’t have to pay rent any longer, cuz I’m moving back home to my slightly larger single-wide in Putnam County, Tennessee that I paid less than $15k for. And it’s property taxes are only $160/year!

What’s messed up is that my wife and I have nice government jobs (she’s a school teacher, I work for the feds) and our income is waaaay over the median for the county, but if we had the same jobs in Irvine, our incomes, adjusting for Irvine school pay and the increased locality for federal employees, would put us about average. I’ve got a few acres with nice forested land around and awesome views. Now I may not be near the ocean, but that’s ok. Cuz when you have turkey and deer run across your fron and back fields, life is good.

Is the weather worth that much more?

It seems like the rental rates and housing prices are tied more to income levels than anything else. Since the median income in Putnam County is lower than OC, so are rents. And it also helps to have a small state university in town. Those college kids love apartments. Makes for plentiful supply.

Gotta love this image!

Kirk is a poor soul.  He went away for a while and he is now back.  Don’t feed him.

Read the Black Swan book instead.  it is wonderful.

So it seems people are voting with their feet.  Last census data (last months LA times, don’t have the link) did show an exodus of people out of CA with the population only stable because of births.

Since baby’s don’t pay rent, this should put more downward pressure on rental properties.

In 1991, the migration signal was that U-Haul had a hard time keeping trucks in the state.

550k at most. IRVINE WILL BOTTOM OUT AT 200 PER SQFT.

this is not a home for a family making 300k, rather for a family making 150k. 

Easy on the Koolaid. you showing signs of intoxication :mrgreen:

I see stupid people. I see people in this economy whose expectations are so out of whack that even education and economic fundamentals cannot forewarn these people about the economic turmoil that is going to set in this year. I see stupid people..

Thank you. I will use that one.

Some recent escrow entries in Irvine and Tustin (since I watch both) for 2200+ sf SFRs:

http://www.redfin.com/stingray/do/printable-listing?listing-id=1332995

http://www.redfin.com/stingray/do/printable-listing?listing-id=1170085

http://www.redfin.com/stingray/do/printable-listing?listing-id=1349355

http://www.redfin.com/stingray/do/printable-listing?listing-id=1085482

Kind of liked this one…  Relo company owned.  Was hoping it dipped into the $900s.  Backed up to a nice greenbelt park area.

http://www.redfin.com/stingray/do/printable-listing?listing-id=860067

Featured on this blog. 

Shark’s comment at the time - “Its not worth anywhere near 700k right now! Mark this post and check back in 18 months. 525k top, 450k maybe. I mean that’s a half million dollars for this.. c’mon.” 

My comment back to him - “They could move it for $750K right now if they wanted to. Hell, they could probably move it for $800K right now.  Very recent comps, less some discounting for a falling market, indicate the current market value for a property. YOU may not think it’s worth $700K for YOU, I might not think it’s worth $700K to ME, but those are personal opinions not indicators of market value. Obviously people are buying houses in this area still and paying north of $350 per sf. MLS doesn’t lie.”

Wonder how much it’s in escrow for right now?

http://www.redfin.com/stingray/do/printable-listing?listing-id=1182730

Wow.  So I take some time off for the holidays and return to work this week.  It takes me a couple days to catch up on my IHB posts and what do I find?  I find some libertarian troll channeling a sorry imitation of the ghost of Ayn Rand.  And I find some other guy who doesn’t understand that repeatedly telling people how much he makes in pseudo-anonymous comments on a blog is the epitome of insecurity (and in all likelihood, fabrication).  Personally, I thought his nonsense was thoroughly discredited yesterday, but your mileage may vary.

Just like the unplanned neighborhoods outside of Irvine that some of us live in, 1 or 2 nuisance properties can destroy the property values for the rest of us.  Sadly, the “market” for IHB comments has recently corrected a bit since the peak pricing of mid-December 2007.  Please folks, ignore the trolls and let’s get back to the good stuff.