Irvine Housing Blog

For the commission that I would be paying on $8.8 million, I would expect the agent to know the difference between “story” and “storey”

I woke up much too early this morning and, after reading everything worthwhile on the internet, had to resort to an old fashioned book to pass the time waiting for everyone else to awaken.

The book I chose was a long time favorite, Tortilla Flat by John Steinbeck.  I mention it in this forum because the book has many convoluted real estate arrangements driving its various episodes and because each scheme is usually driven ostensibly with the most high minded and yet truly simultaneously sinister intentions.

I was particularly taken by this passage, reproduced below describing one character’s state of mind shortly after embarking on such a scheme and how we might often think of ourselves so:

Pilon was a lover of beauty and a mystic.  He raised his face into the sky and his soul arose out of him into the sun’s afterglow.  That not too perfect Pilon, who plotted and fought, who drank and cursed, trudged slowly on; but a wistful and shining Pilon went up to the sea gulls where they bathed on sensitive wings in the evening.  That Pilon was beautiful, and his thoughts were unstained with selfishness and lust.  And his thoughts are good to know.

The character then goes on to offer to essentially sublease the house he is renting for the exact amount of the rent that he owes his landlord friend, Danny.

To quote from a few pages earlier in the book: “It is impossible to say whether Danny expected any rent, or whether Pilon expected to pay any.  If they did both were disappointed.”

Holy crap!  The area where I live (a block inland from the Redondo Beach Pier) is awash in people paying upwards of 70% of their income to pretend to be homeowners!  Just two blocks inward (Torrance) it drops to a reasonable 50%!  I’ve been a lowly renter in this quiet, safe neighborhood for 15 years, and for some reason they just don’t raise my rent.  (It’s probably because I’m quiet and have my rent on auto-pay).  My costs to live in this nice area (though in admittedly cramped quarters): 9%!  I’M THROWING MY MONEY AWAY!  I feel so empty inside…

That affordability site is neat.  Now I feel guilty for scolding you earlier this week on the whole morality thing, I’ve learned so much from this blog I don’t know how you produce so much day after day but my hat’s off to you.

Is there ever going to be another IHB meetup?

I’m itching to get out of Hollywierd and come on down to the promised land for a day!

I’d also pitch in for some sort of fund to help convince AZDavidPhx to show up.

IR,
Do you have map that breaks down DTI for above 30% DTI .  I can believe that a 35% DTI can be substained, but the above 50% is unsubstainable. If lots of households are at 50% or more, they can only do it for 10 years before exhausting or a HEW infusion is needed to keep them hooked.  Kind of like a junkie getting a fix to keep going.

IR,
  Did you know that yesterday Senator Carl Levin held a hearing on the credit rating agencies? While I knew the hearing was going on, this is the first story I’ve seen as to what they heard. This should have been front-page news this AM…

Aahh. statistics and lies…. 

Mathematically I see a BIG problem with those charts.  they are mixing data sets and the end result is not valid data.  Reminds me of the time I used too many interpolation points in a FFT algorithm and I discovered negative gravity… the algorithm diverged when you wanted to do too many interpolations.

This is the problem here:

Those charts is that they use a wide area “regional income” number to compare very detailed RE prices.  That, make them useless.  If they are going to use regional income, then they must keep their “RE price” areas to the same level of granularity…  Either compare all of OC, or figure out the household income for a given neighborhood.

See?  Allowing the income in Santa Ana to affect the charts in TR automatically disqualifies the chart data.  Because someone looking to purchase in Santa Ana would not look into TR, and viceversa.

These are independent data sets. 

But they allow to commingle them.

Example: I was looking at the TR charts and they look awful, until you realize that they use a regional household income at XK.

Now, I gotta tell you, if your household income is $58K you are not looking into TR.

More zipcode fun:
1. Go to redfin.com
2. In the search box, type in a zip code
3. Click on any random house listing in that area to open it
4. Scroll down to the bottom of the house listing and in the “Communities and Schools” section, click on the zip code’s demographics link

Then you see a page with all the demographics for that zip code.  Scroll to the bottom of the page and there is an income by dollar range (Median Income) that shows you exactly how many households make which income range.  Pretty interesting.