Irvine Housing Blog

Wow—-

http://finance.yahoo.com/loans/article/113040/more-money-for-struggling-homeowners-smartmoney?mod=loans-home#mwpphu-post-form

    If you have not ready yet, our government is now giving 50k to banks for loan owners that can’t make their payments.

    More disgusting legislation pitched as homeowner assistance when in reality it’s just another way for our legislators to funnel money to their buddies at the banks at the expense of the average American. This will help the banks far more than anybody else. If it was really meant to be directed to people in tough situations and address their housing issues they would also have an aspect that helped people that have lost their jobs with their rent. Don’t we already have unemployment and social security?

However, since rent does not go to their buddies at the banks they conveniently leave out that entire portion of society, many of whom have been paying taxes for years that will be used to pay for this program. Our government has taken an anti-robin hood approach steal from the middle class tax payer and give to the rich banker, how much longer can this continue?

In the Great Housing Bubble, I pointed out that the entire subprime lending model masked its poor performance by an appreciating market

I think you are being too kind here.  The subprime lending model, through the expectation of serial refinancing, actually parasitised the appreciating market.

And, of course, eventually killed the host . . .

I wanted to respond to Awgee’s question regarding why I don’t believe that QH Olivos and Tapestry homes will reach their original offering prices (i.e. 2003 prices).

QH has a highly defined hierarchy of homes with size and relative elevation bands indicating price. Current pricing of the detached condos ($700-800 range) (e.g. Linden) are highly supportive of both Olivos and Tapestry.

QH, though a relatively new area, has not experienced the level of distress associated with other more recent developments like Ladera. Where there is distress in QH is concentrated in the attached condos.

Time on market is extremely low in QH for reasonable priced SFRs.

To get to 2003 pricing, QH SFR would need a 25%-30%+ drop from current pricing. Lacking distress in terms of loan performance and/or umployment, I just do not see the catalyst for those types of drops.

QH has hills where most of Irvine is hideous and flat.

To expect massive organizations like BofA to move quickly on anything is wishful thinking. There are probably still hundreds of employees there living in a 2006 mindset - it’s just human nature. Any time a corporation gets hooked on one revenue stream it can take years or decades for them to move on when that stream dies. Just look at the music industry and CDs. The sad part in this case is that consumers only have one route to buy a home if they can’t pay cash - thru a bank. There needs to be a disrupter like Napster for the housing market. But the banksters have too much money and too many lobbyists to ever let that happen.

Price in QH SFRs have been essentially flat since winter 08/09 (PR don’t gloat too much please).

Right now there are a grand total of 9 SFR for sale in QH, with an average time on market of 72 days (with the only one more than 6 months being the lone short sale).

Barring some foreclosure/default data that would indicate significany supply pressure, or some big hit to local employment, I believe that current prices are “reasonable”.

There are certain tracts that are virtually even with peak pricing, while adjacent tracts (Olivos, Tapestry and Vicara) have come down a solid 20-25%.

Fannie Mae Silence on Taylor Bean Led to $3 Billion Fraud

http://www.bloomberg.com/news/2011-06-30/fannie-mae-silence-on-taylor-bean-mortgages-opened-way-to-3-billion-fraud.html