Irvine Housing Blog

The current owner is the bank?  If so, did the lender pay to have this staged?  Or is this being rented out currently?  I don’t think those bananas and apples are from 2007 or 2008.

If this is being staged, that strikes me as quite odd.  Staging a condo that’s under 200k in order to take a 59% loss?

If this is being rented out and is for sale, that’s a good sign.  That would mean that at least one bank had the desire to rent property instead to dumping yet another vacant place on the market.  Banks could have major economies of scale if they wanted to be landlords.

On the west coast of FL, these condos would be worth $45k (+/- $10k depending on the specific location).

Comparing the prices of the two areas says a lot.

Glad to see the pick up on the year + of paying interest on the bond backed by the mortgage. 

I really hope BF & Co don’t get their condo extension into the GSE’s.  In FL there are many condos that have sold for 75% off peak, almost always after FC.  Some condo complexes, including one I lived in for 4 years growing up, has not had an organic sale - non auction/bank sale, since Sept 2007!  450 unit complex!  It prob won’t get that bad in Irvine, but I’m sure some areas of SoCal have felt that.

The 2nd unit is a short sale - per redfin, the 1st has no real picture.

Is that 2nd unit really 471sqft?  Do people buy 470sqft apartments in NY?  Looked and I think they do, for a whole lot.  I’d rather rent at that size if only to hold onto the idea that it was a very temporary situation.  But if the temp situation is to live there for a couple years and book a 100k or so profit, it would feel a whole lot better (two owners got that).

From the Gary Watts outlook:

Option ARM mortgages total 1.5 trillion, with California holding half.

90% of Option ARM borrowers are paying the minimum.

This year, 47% of all Option ARMs will be recast.

I am really becoming tired of being bearish.  But, when you develop a rich understanding of how and why this happened, then you connect all the dots, one word comes to mind—calamity.

Watts finally broke down - while i want to say he had a moment of clarity, he probably sees clients leaving in droves.

Gary Watts just follows the sentiment that’s in vogue at the moment.  You guys know that.  Hearing him in the bear camp should make you wonder if this is like seeing this story on the cover of Time.

Anyone knows if the first one (The Lakes) is on a leased land?

Question for anyone: I was told yesterday by a realtor that the government’s home rescue plan included a ban on prepayment penalties on any loan for properties purchased after the plan took effect - not retroactive. I can find nothing to this effect. Anyone know?

Looks like the kool-aid detox program is finally helping Gary Watts see straight again.  With the dire economic situation in California, I see no reason to be a buyer in real estate until I see clearer skies ahead…and that will be many years.  I simply do not trust one word from the following group:  realtors, NAR spokesholes, politicians, main stream media, etc.

OK, I nominate “community lake” to join “estate-sized lot” and “light and bright” in the lexicon of California realtor-ese.  My grandfather’s little fishpond was the size of this affair (he dug it and arranged the rocks and piped the little waterfall himself), and we called it a “fishpond”.

It’s boring in here today, compared to yesterday with Nancy. I’m going over to TMZ

The description for Pineview states it’s in West Irvine. I thought it was in Northwood (corner of Irvine and Yale across from the shopping center). Did the bank just redraw neighborhood boundaries to their liking?

Its 683 sq ft.  The sq root of 683 = a 26.2 x 26.2 ft area.  And that’s your home.

My 2007 Honda Accord is ~16 ft long.

For 680sf on two floors or ~600 usable sf.  That’s $1180 for interest, taxes, misc. expenses and HOA.  I rather rent.

I am interviewed over at Irvine Homes Blog:

Blogger: Irvine housing market nowhere near bottom.

What’s the dealeo on 26 desert willow? Flip?

Ladies, Look for LARGE in your man’s endowments (multiple meanings apply);  not in your home size. 

Likewise, LARGE homes and living LARGE are perfect for building and early grave for your breadwinners.

This condo may be perfect for an elderly who’s moving DOWN, down-sizing.

Why does IR think the whole world must move-up?  In psychology that’s called projection… can’t blame people for projecting, we’re all caught up in our subjective little worlds (and money making schemes).

Field News:  When I first started reading this blog a month ago, I found homes in my Irvine neighborhood in Backup-Offer Status within days, something I had not seen since the early bubble days.  The newer listings have had the courage to raise their prices since then;  I figured they may stay on the market and lower their prices;  they didn’t;  they’re higher, and they’re staying on the market a few weeks rather than days, but they’re in Backup-Offer status again.  These are mid-priced SFR homes in highly desirable school systems.  One got a half-cash offer, and one went for above asking price in just days on the market.  I found out from their owners/agents.

This is what’s happening that is NOT being paraded by the Prophets of Bad News, profiteers of Market-Timing schemes.

IHB, Meet Irvine Pride of Ownership.

This blog is essentially endorsing Market Timing of buying a primary home.  The blogger claims buying a home can be profitable if you analyze it with some form of technical analysis as applied to stocks - trend analysis of rent vs home price over years.  He pulls out of his hat a few graphs and a formula for what is a reasonable price, and claims the whole city of Irvine will fit into his simple model.  He has mapped into a graph and a formula the secrets of home valuation in Irvine.  A major achievement for a non-economist. 

Add to the recipe references to pop-culture (high wisdom from the song “Fat-Bottomed Girls”) and he’s managed to find himself a die-hard follower crowd who manifest themselves with enlightened sayings such as “ignorantoutsider’s” above.

In low transaction areas, home valuations don’t follow graphs and formulae.  They follow supply and demand and no one has the crystal ball to predict value;  and trend analysis has little bearing on areas that were just 5 years old when the bubble began.  Chances are, with Irvine being one of the most prolific centers of job creation in Southern California, its inhabitants having one of the highest levels of education, and unusually high median incomes ($150K), there’s a brighter future here down the road than I see in the high-priced WestSide. 

When I buy a 15-yr bond, I don’t lose sleep over what how its value fluctuates.  And a home to me is an inflation-protected 15-year bond that pays your housing cost forever, once your debt is paid-off.  Don’t bother with rent-ownership analysis, it’s all a chickenhawk’s weird fantasy.

Just imagine if Market Timing and Trend Analysis was applied to another once-in-a-lifetime event, marriage.  What would the blogger of the Irvine Marriage Blog advertise?  He’d probably serenade his party with Queen’s endearing song, “Fat Bottomed Girl.”  He’d work on her self-esteem, parading a slew of bad marriages and grotesque people. He’ll ensure she feels worthless and cheap, before proposing to marry her.  That’s an analogy of the mentality at played here.  A little pathological, you think?

If you’re not getting a fair and balanced representation of the Irvine housing market, you must ask, why.

Not necessary market timing to make a profit, but timing to avoid a large loss.  I don’t think those that purchase houses in Riverside during the high will be able to sell near their purchase price for over 20 years.  The govt and banks have and are rewarding those that promoted the housing pyramid scheme.

Nancy, Where do you find that the median income is $150,000?  Even with $150,000 the medium house cost is still too high.  The analysis of income and house price is not technical analysis (charting) but fundamental analysis (income and cost of ownership).  Technical analysis prices can go up forever—it doesn’t matter if people can afford the house.  Creative financing will rule the day.  Sort of cooking the books.

The latest census has median household income with kids in the house at TR at $120,000.  The average household income in Irvine is lower.  Much of the job creation in OC was with the creative lending programs (subprime, opt-ARM with negative amortization, alt-A lending) that got the country in such a mess.  Those high paying jobs are mostly gone.  Hopefully for good.

For mdian income and other stats, check out SoCalMLS, under the “neighborhood” tab for a listing.

If you think Irvine is too high now, what do you think of Westside, LA?  Astronomical?  When 80% of homeowners there retain their home on the average 30 years, it really doesn’t matter what the median income there is, there’s absolutely no correlation.  The charting analysis I found dates back to IR’s earliest 2006 blogs, it’s where I found he flipped his magic ratios.

If you buy for long-term and in good areas, there won’t be *any* loss compared to renting, no matter major loss.  Agents are well-aware of areas that hold their value during corrections, and Riverside never made the that list.  This is not the first time SoCal had a housing correction, people.  The people I know who sold in the last correction only lived to regret it.

Have you checked Irvine’s unemployment history, compared to, say, Westside LA?  You’d be pleasantly surprised.  We were 4% last year, 6% the past few months with signs of decline;  still much better than CA overall.

http://www.economagic.com/em-cgi/data.exe/blsla/laupa06460003

Many new jobs are coming to Irvine; Kaiser just built a major hospital, FDIC’s western bank liquidation center is headquartered here (yes, there’s lots of job opportunities from liquidating banks), UCI and its hospital are major employers, medial services and R&D is still bustling.  Irvine is diverse, and none of our neighbors works in real-estate.

There’s one family moving in from the East Coast with 50% down, another family bought a house nearby, both husband and wife are doctors, and another family had a recent graduate from a professional school who was hired at twice the median income for this neighborhood.  Notice, these people can afford a lot more “home” than what they have or bought here.  Those who can, usually don’t live large.

Nancy, you sound a bit like a disgruntled realtor eager to counter the market “pessimism.” Come clean, please.

Irvine:  $98,923
California:  $59,948

Median gross rent in 2007: $1,829.
Percentage of residents living in poverty in 2007: 8.7%

Household income is better than most places $98,923 (before job losses started rising) but still a lot lower than the $150k that Nancy is claiming!

Here’s the link for that:
http://www.city-data.com/city/Irvine-California.html

“Ugly, cramped, dingy, old condos are an acquired taste. If you learn to like them, you can save much money on your housing bills…”

This just became my personal mantra. I guess everyone has a life philosophy, but often we await its most eloquent distillation.

I’m currently pondering continuing my renting habits here in Denver if and until the 1992 condo crash repeats itself—$20K cash would buy a dingy 2 bdrm at that point—and pouncing. Live rent-free until retirement, then retire early with my pile of savings, and the rental income from the dingy condo.

Thanks for that!