Irvine Housing Blog

I wonder what kind of rent it can fetch on the property of $180k in San Jacinto today? Where are the rental investors?

There is absolutely no reason a builder needs to build a 3,000 sq ft monstrosity in the middle of the desert.

Actually if you look at some properties in San Bernadino and Riverside, discount has reached above 60%.  http://housing-kaboom.blogspot.com/2008/08/70-year-over-year-decline.html

Sacramento is a total carnage http://flippersintrouble.blogspot.com/

My friend actually brought a brochure for Texas where they had new homes for sale 3000 SF for around $130,000 in the suburbs of Hustan, making it $43/SF. I cant imagine how anyone could sell for that less. There are lots of bargains out there, but the problem is there are not enough buyers who can actually qualify and not enough banks who will lend.  We are at the tip of seeing the higher side of the market getting hammered. 

I am sure Irvine will surpass 60% loss easily from the peak. Home values in Ladera Ranch for example actually trippled from 2001 to 2006, so for it to come down to real value once its said and done, 60% discount will stil leave equity in the house.  It is amazing that falling home prices are outpacing peoples savings rate my multiples. So, in the essence, you are saving your own $$ as cash plus $$ from falling prices if you are on the sidelines.  I will pick something towards the end of 2009 or early 2010.

I am mystified by the Indio market.  Exactly how poverty-stricken in your retirement would you have to be to live there, even at these prices? Terrible heat 6 months of the year, dreadful air pollution most of the year, absolutely no cultural opportunities and absolutely minimal urban amenities (I mean, Indio doesn’t even have very good supermarkets—I guess you could drive up the freeway and play blackjack at the casino). The subdivisions shown are unattractive, the homes poorly designed and unimaginative (and one shudders to think of the construction issues that will show up). What on earth were people thinking? I’m not sure there’s a price low enough to market these, and the boarding-up on the first listing is probably just the first stage of crumbling back into the desert. This makes Phoenix and its suburbs look like paradise.

The IE has nothing in common with the OC. It is false to make comparisons to Irvine.

Irvine is not Corona or Norco. For if Irvine had cows, they would be the happy cheese kind. Their shit would not stink, and they would all drive to the corner mini mall and eat frozen yougart, made from goat’s milk, of course.

Seriously, Hemet/San Jacinto is a retirement area too. But I was wondering the same thing myself, IR—how does OC avoid get wet, when a tidal wave is crashing next door? This is a pretty good indicator of what is going to be happening here. OC == (IE)x2 == $350k jumbo houses in Irvine. There will be much wailing, beating of breasts, and gnashing of teeth.

Calling Indio part of the Palm Springs market would be like direct comparison between ghastly Garbage Grove and snooty wanna-be pretentious Irvine.

As more construction jobs are lost, is it possible that construction wages will decrease, thereby decreasing replacement costs?

Since you are bringing up Hemet and San Jacinito here are a few fun facts. 

One might say that San Jacinito is a suburb of Hemet as all the business are in Hemet.  San Jacinito has a few (<3) small strip malls.  San Jacinito has a lot of nice new developments that are going for $65 sq ft!! Look it up in Zillow, ouch!!  Oh and they built them and heavy as they are all underwater.  And that is driving the housing prices down in Hemet and the surrounding smaller cities. Even Moreno Valley is seeing housing at $85 per sq ft. Riverside is starting to see $100 per sq ft. Someone mentioned a tidal wave heading for the OC.  Yes the IE wave is fast approaching the OC and once it breaches the Santa Ana Canyon watch out!

A 2br/1.75 bath, 900 sq ft house in Hemet for the 55+ crowd is renting for $650-700 a month.  Oh a good rental for the retirement crowd is a single story home.  Funny I can’t understand why an older person would not want to climb stairs? It’s good a good cardio excerise routine!   Oh and they all have small dogs as well.

Great song, John!

lambcannon is correct, Indio may be physically close to Palm Springs but it is about as much like it as Desert Hot Springs (a real s%^&hole;of a town).

This site’s focus on Irvine is one reason why analysis goes so deep, but this broadening of the focus to grab some context makes me shudder—a 60 percent loss of value, even when that value was never real, is just incredible.

Incredible. 22 Daffodil 92618 (2bd/2bth) was short selling itself for $360k and it got sold for $452k.

Either the new owner is a knife catcher or there must be fraudulent activity going on.

So much for Irvine RE price dropping further.

Obviously building costs vary with market conditions. Expect labor to drop with a rise in unemployment. Materials are unclear… rising inflation vs falling demand = ?

I think replacement cost may only be relevent for insurance purposes. Look at the near worthless mansions in many urban areas. Replacement cost has no bearing on their value IMO.

Due to demographic trends, many areas are permanently overbuilt.