Please Don’t Stop The Music
Please Don't Stop The Music -- Rihanna
When I first moved to Irvine, I lived in Oak Creek. It is still one of my favorite neighborhoods. My wife has given me her parameters for what she desires in a home, and today's featured property perfectly fits her description (now if I could just afford it...) It is in Oak Creek near the elementary school, it has a large yard, it is an open plan, the wood is a medium tone, and the surfaces are a medium tone granite, there is a downstairs den/bedroom, and the home itself is spacious. When prices get to the affordability range, this is the kind of property I will be bidding on.
Today's featured property is a story of of the Ponzi Scheme / Musical Chairs aspect of the real estate bubble coming to an end. The owner of this property is the one without a chair. I suspect she wishes the music would not have stopped playing.
Asking Price: $999,999
Income Requirement: $249,999
Downpayment Needed: $199,999
Monthly Equity Burn: $8,333
Purchase Price: $1,194,000
Purchase Date: 4/11/2005
Address: 2 Palmwood, Irvine, CA 92618
| Beds: | 4 |
| Baths: | 3 |
| Sq. Ft.: | 3,029 |
| $/Sq. Ft.: | $330 |
| Lot Size: | - |
| Property Type: | Single Family Residence |
| Style: | Other |
| Year Built: | 1999 |
| Stories: | 2 Levels |
| Area: | Oak Creek |
| County: | Orange |
| MLS#: | S536411 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 5 days |
moding?
Check out the sales history of this property:
| Date | Price | Appreciation |
| Jul 08, 1999 | $551,500 | |
| Mar 30, 2004 | $1,035,000 | |
| Apr 18, 2005 | $1,194,000 |
The first owners doubled their money in 5 years. Now that is timing the market.
The second owners made $159,000 in less than one year of ownership. Great trade!
The third owner... well, she didn't get quite so lucky. She purchased the property in 2005 with a $955,200 first mortgage, a $119,400 second and she put 10% down. She managed to refinance into an Option ARM for $1,088,000 just before the credit crunch in early August 2007. Brilliant move, refinancing into an Option ARM -- not. I suspect her plan was to lower her payments and wait out this "minor correction." Unfortunately, the music is not going to play again, and she either cannot make the payments, or she has realized it is hopeless, and she is getting out of the transaction. Either way the $119,400 she has in the property is gone, and this is going to be a short sale, so her credit is gone too. If this property sells for its asking price, the total loss on the property will be $254,000. I guess the distress in the market is not just at the low end.
Another day, another quarter million dollar loss.
.
Please don't stop the music, music, music, music, music, music.
Please don't stop the music, music, music, music, music, music.
It's gettin late
I'm making my way over to my favorite place
I gotta get my body moving shake the stress away
I wasn't looking for nobody when you looked my way
Possible candidate (yeah)
Who knew
That you'd be up in here lookin like you do
You're makin' stayin' over here impossible
Baby I must say your aura is incredible
If you don't have to go don't
Do you know what you started
I just came here to party
But now we're rockin on the dance floor
Acting naughty
Your hands around my waist
Just let the music play
We're hand in hand
Chest to chest
And now we're face to face
I wanna take you away
Lets escape into the music
DJ let it play
I just can't refuse it
Like the way you do this
Keep on rockin to it
Please don't stop the
Please don't stop the music
Please Don't Stop The Music -- Rihanna
I think afford is the wrong word. I obviously don’t know your financial situation but I know many people who sat out of the housing bubble and now have hefty down payments. I could put my down payment funds towards this house and the loan amount would be 3x our pre-tax income and I am not unique. Basically people can *afford* this house but it’s financial suicide.
Maybe its just me but I hate the word afford. One of my biggest qualms of this bubble is this constant view of not being able to afford a house because I choose to rent.
There is a post on the forum where somebody breaks down the per capita income.
If you have $250K to put down and make $250K a year, you are in the top 2% of Irvine and the top 1% of all US citizens.
You, sir, are in rare air. Congrats!
That said, there are very few people like you.
I agree with the stats, but if you went to grad school, you probably married someone with a graduate degree and have many local friends/coworkers with graduate degrees. And it certainly “feels” like there are plenty $250k households with sufficient liquidity. Just an observation…
Just because you hang out with a lot of people making 250K doesn’t mean they’re everywhere.
I imagine some McMansion sellers have this myth floating in the back of in their mind to justify their WTF asking price.
The *majority* of people working in the fancy Irvine corporate buildings are likely making beans. My girlfriend is an accountant and works for one of the top nominees for OC Metros “Best places to work in OC”, who happens to be in Irvine, and the salaries for the majority of their staff aren’t much higher than our neighbor of the sun, Phoenix.
Which is why, IMO, if you’re on the bottom of the pay scale in OC, you’re probably impoverished considering the high cost of living. I mean heck, a one bedroom rents for a MINIMUM of $1450 in Irvine, a movie ticket is $15, and a frozen yogurt at Golden Spoon is $4.50 with just one topping! Renting and eating ice cream is about all you can do in Irvine if you make under 50-55K per year. Get out if you can!
Another hidden cost of living in a high cost area such as Irvine is you get pummeled on state and local taxes. I would pay about 15-18k/year in taxes when I made 50K because the gruberment doesn’t take into account your cost of living as a W2 employee. I find it ironic that our tax code pummels low wage earners in high cost of living locations since the whole purpose of the progressive tax structure in this country is to tax people what they can “afford” to pay. Why the government believes everyone can “afford” to pay the same rate while living in different areas of the country is beyond me.
I would be interested to know what all of these 250K high wage earners do (job titles) and what companies they work for.
When I see the “I know lots of people making blah blah”, I have to assume it is a gross exaggeration as the average salaries for Irvine do not correlate well with those statements.
I also think that people are generalizing couples income and stating it as though a single person’s income. They may know a couple where the one person earns 150K and the other earns 100K and then they say “Oh I know lots of people who earn 250K”.
“Just because you hang out with a lot of people making 250K doesn’t mean they’re everywhere…“
Um, I said I agree with the stats…
“...They may know a couple where the one person earns 150K and the other earns 100K and then they say “Oh I know lots of people who earn 250K”...“
Um, I said “there are plenty $250k households.“
Principals at my company probably make $200k+. If their spouse work, they can top the $250k. With that said, there are a lot more people making way less than them. Top few % of earners.
I would be interested to know what all of these 250K high wage earners do (job titles) and what companies they work for.
During the bubble years (aka 2005-2006), it was not uncommon to find high school graduates (and dropouts)and even ex-felons making $10,000/month in the Orange County mortgage industry.
“ the whole purpose of the progressive tax structure in this country is to tax people what they can “afford” to pay. “
Not really - the whole purpose of the tax structure (especially prop 13 and high income taxes in california) is to give wealthy baby boomers a free ride while young families and the cities and schools that serve them go broke. Why? Because the boomers and AARP are designed to make that happen. And they do.
Prop 13 didn’t bother me the last 15 years as a homeowner because I figtured that some day 30+ years down the road, I would ultimately get the benefit of it…then again, it’s probably going to be like social security - a benefit that generations before me had that I’ll never see. But hey, who said life was fair ? You don’t like taxes here, go to a state back east (like N.J.) where the RE tax rate often exceeds 3%...oh, and home values in your town get reassessed every 7 years so your taxes can literally double overnight…then as housing values plummet, you can spend years trying to get a refund. Should people really have to sell a home they’ve lived in for a lifetime just because of RE tax increases ? Or how about the states where there’s a ‘transfer’ tax of like 1% of home value when you sell it ? I’m not sure there’s a fully equitable R.E. tax system out there…
I post on here from time to time, but I am doing it
anonymously this time because I don’t want to discuss my personal finances in public.
I am an analog circuit design engineer with Broadcom.
I make approximately $225k a year.
My wife is an admin at UC Irvine, makes about 55k
So together we make 280k.
There are probably at least several dozen people in my group at work in a similar situation.
For the record, I have a Ph.D. in electrical engineering.
Yes, that true. Some of my looser friends would come up to me and brag about someone they know in the mortgage industry making tones of money. 20k, 30k, 40k a month. These mortgage industry sales people would be screwing home buyers over selling them loans they could not afford. Many of them told me they would lie on loan apps. saying it was “industry standard practice” and “you would have to lie on the applications in order to get them approved”. They didn’t care about there costumers, they didn’t care about the banks they were representing and they didn’t care about the future business they were loosing. All they cared about is there “rips” (commissions). And now 90% of these guys are out of jobs. On a recent hire in my company I received around 200 resumes. I automatically threw out all the resumes of the people who were involved in the mortgage business after 1999. That tells you allot about a person.
In most cases graduate degrees = serious debt which overshadows any increased income gleamed from the degree.
In fact, most of the granduate degree holders I know, after taking into consideration educational debt, are much closer to insolvancy than holders a college degree who have worked since graduating.
Define “graduate degree”
PhD: yes, certainly. I have one, and I could be making much more with much less debt.
MBA/JD: no way. You’ll end up borrowing as much as a PhD does, but the pay to a JD or MBA can easily be double.
I have a JD. Fortunately, I was lucky enough to get a full ride and land a good job. However, the vast majority of JD holders don’t make the big $s and have a crippling amount of debt. Even those who do land the big firm jobs often take a decade or more to pay back their loans. Add that to the federal government’s wonderful alternative minimum tax system, and, all of a sudden, making $200k+ a year doesn’t really buy you the life everyone assumes it would.
I also have a good number friends who hold MBAs, and personally, I don’t think they’re worth the paper they’re printed on. The market is saturated with MBAs and JDs and very few $150k+ jobs – but that hasn’t stopped the graduate degree mills from enrolling itchy-palm dreamers.
Well stated. For the past several years, I’ve wondered when the philosophy of our higher educational institutions changed. The very value of an advanced degree is now effectively nothing. I must admit I only hold a BS in Architecture (dropped out of the MS program a yr from completion due to debt) but I’ve seen scores of universities hawking MBA’s promising riches. They churn out graduates like it’s a business model and since when did that become a prime motive? I had always thought education was a noble enterprise not something to be marketed and spun. I tell younger people fresh out of college considering grad school to acquire experience first, get a few years under the belt then consider grad school. Just my two cents.
On the home ... very nice house, very nice indeed. A little cliche (ie: pergraniteel) but nothing a clever paint scheme can’t fix. My only real concern would be the proximity to the 405’s fumes.
Ok, I have close to 1.5 in net worth but I’m making only $128k a year. I guess I’m not in the top 1% but rather the top 10% then.
What you make a year doesn’t mean crap. It’s the net worth that counts. Try saying what you make a year counts to those laid off BSC folks
What do you do making $128k/yr? And do you do it in Irvine? Just curious. Cheers!
Nope, I’m doing it in San Jose. We have the same housing problem although not as severe as Irvine (yet). Private sector (engineering) although I’ve heard from various folks that this pay is rather below avg for senior engineer.
Your net worth based on your age. Hope you are not 50 and planning to retiree at 55, but if you are 35 you are in GREAT shape!
I’m not 50 yet but I’m above 35. I do feel lucky to be in this shape.
I used to live in Irvine and frankly made some $$ selling before this crash. I’m hoping to get back in around 2012 when the dust settles. I’m sure by then housing price would have either bottomed out or close to reaching bottom (for those that still don’t think 2012 is the year of the bottom).
92606 and 92618 would be 2 great zip codes
“Afford” is a huge sliding scale that’s very subjective. When I use “afford” I qualify it; e.g. “People who bought homes they could afford (2.5x income & below 28/33% DTIs) in the past few years are not in hopeless horrible situations.“
Your comment is completely on target. I have met many people in the $50K-75K a year bracket who have a decent financial situation, complete with healthy savings accounts, little or no debt, and substantial equity in property because they exercised caution and self-control.
On the other hand, I know way too many people, including a few relatives, who’d be broke no matter how high their incomes were. These are people who’ve made in excess of $200K a year for 30 years trailing, and yet have managed to blow through every dollar and pile up staggering debt loads in the process.
There is NO amount of money you can’t blow through, and have completely nothing to show but a bankruptcy filing, if you make a career out of consuming. Ask any lotto winner! I promise you that I could, if asked, get rid of $5MM on Michigan Ave in any one afternoon, making no more than 7 stops. It takes no brains or thought to shoot money.
You may know “many”, but that is not representative of the masses. There has been an ongoing negative savings rate in the country. Actually I beg to differ quite a bit—I’ll bet there are less than 1,000 people in Orange County “who sat out the housing bubble and now have hefty down payments”. One thousand would be 0.03% of OC’s population. Plus, “hefty” is very subjective. I know of very few people who are patiently waiting on the sidelines, entirely out of the local real estate market, with hefty down payments ready to go. Not in Santa Ana, and not in Newport Beach.
This would be a pretty good deal at 600k.
At $600,000 I would PASS. In fact, I wouldn’t live here at any price (well, maybe SOME price).
It backs to Alton (literally, your back wall is on Alton), so you have cars wizzing by 24/7, along with the roar of trucks and the diesel fumes. Yes, resort like setting unless you’re in the upstairs bedroom. Then the car beams in your windows all night long are like searchlights looking for Allied bombers over Germany.
Of course, all that noise right in your back yard will drown out the constant drone of the 405 freeway just 100 yards away. And the fumes / carbon monoxide will kill enought brain cells so you won’t even notice after a week or two.
Call me a snob, but for a cool million I expect much, much better.
I am with you on this one.
“Then the car beams in your windows all night long are like searchlights looking for Allied bombers over Germany.“
Too funny…
Hey, its only a million bucks. You expect something on a quiet street?
This house is worth more that $600K right now. In fact I’ll buy it for $700K.
Real estate dose eventually go up, especially in Irvine. Plus you guys haven’t even thought about inflation. The dollar isn’t worth what it was back in 1999 for example.
What cost $425000 in 1999 would cost $538499.87 in 2007.
So the 2500 sq foot house I bought in 99 would coast me about 540k now. With inflation in mind, a 3000 sq foot house is worth more than 600K. Plus the market has gone up.
You guys have to be realistic. Irvine is one of the best places to live in the world. The house is overpriced at 1 mill, but come on.
Do you guys remember Jim Carrey in Ace Ventura: Pet Detective when he bends over and talks out of his a$$.
So what price do you think this will be at the bottom? What price would you pay?
Both $250 sq/ft and 4% appreciation since 1999 lead to a current “worth” of around $775k or a little over that. That’s about 22% more to drop from here. Does it seem realistic that this will really happen? Will the option ARM fallout really work that way? Maybe the severity in SoCal will make it so, but other places I’m not so sure…
It should, I know. But in D.C. right now there’s a heck of a lot of kool-aid knife catchers who wouldn’t even think of buying the bottom of the market that’s already close to rental parity (and priced but not moving for $200k—$280k), but are snapping up the $450k townhomes like hotcakes (previously $550—$600k, generally 5 years newer and with a garage). This season there look to be enough knife catchers out there, such that if you’re willing to sacrifice your 20% down now, you can get out of your over priced home before it resets. It’s batty and frustrating. People really seem to think the next tranch up is immune. And if there are enough knife catchers, maybe it will be…
http://www.hyattluxuryproperties.com/irvine.html
According to year 2000 census (right about when this property was first built and purchased)
Demographics
The median income for a household in the city is $72,000, and the median income for a family is $85,000.
This puts the 1999 median house value in the neighborhood of (85,000 * 4) = 340,000 if you use a 4x income as a means of calculating affordability.
Therefore, the 1999 purchase price of 551,500 was roughly 551,500 / 340,000 = 1.62x the median house price.
Assuming that Irvine maintains its 2006 reported family income of 103,604, the median house price will bottom out around 103,604 * 4 = 414,416 using 4x income as a measure of affordability.
Multiply that 414,416 by the 1.62 ratio from the 1999 semi-pre-bubble purchase and you get a bottom call of 414,416 * 1.62 = 671,353.
This is assuming that median incomes remain at their 2006 levels (highly unlikely).
I’m hedging my bet that median Irvine income will be dropping over the next few years. If it drops back down to 85K to 90K then you can expect the value of this house to return to the 550K to 580K range.
90 * 4 * 1.62 = 583,000
85 * 4 * 1.62 = 551,000
My bet is that IR would pull out his checkbook for this one at $750k. Am I close, IR?
Of course he would be late to the party—- because I’d already haved lock this down when it hit $800k. But those numbers are pointless in 2008, because a more talented knifecatcher will probably cough up at least $950k this summer.
I live in the community and have some insider information. 4 offers at or very near full purchase price as of last week. IR, short sales don’t shoot down your credit depending on your situation. If you have a proven hardship and are current in all your obligations, you can expect around a 15 point drop to an 80 point max depending on the lender. A short sale shows up as a closed account, and if you keep paying off your bills in a timely manner, it is recoverable. Lenders look back 12 months at your credit history, and if you wait and rent for more than 12 months it is not likely they are even going to see it. How many months you are delinquent on your payment affects your credit, not necessarily the short sale itself.
I’m looking at that place, and thinking what sort of place the mere -downpayment- would get me here in the wilds of Arkansas.
I know exactly what $199,000 would get me out here:
The very same home- paid in full.
:hugs backwards ol’ Arkansas:
oooooooo….look out!
They don’t like it when those comparisons are made on this blog!
Truly amazing isn’t it? You can buy a comparable home for $250k in some violence/traffic-free high-end resort town in the midwest, buy a condo in some S/E resort town for $100k to reside in the winters, and still have some 300k left over even after this Irvine home eventually bottoms out.
In regards to retiring baby boomers, the SoCal lifestyle is so overrated.
Obviously So Cal is not the answer for everyone, but there’s a reason why people choose to live here.
Yes, So.Cal. is sooooo overrated. By the way, I biked to work today in the cool, dry, 68 degree weather. My gas bill is about $60.00 per month tops. Tonight it’s BBQ night out on the covered patio - no bugs here. And I don’t bother to lock up my bike because it’s Irvine (I think crime is against Association rules, but I’m not sure).
Yes, Irvine is expensive, but you can’t compare it to Arkansas.
That’s great, Buster. However, you are failing to mention any of the issues that people might find uninviting about Irvine.
Little bit of “confirmation bias” in your post suggesting that Irvine is superior to all areas of Arkansas.
agreed - people on this blog just love to sing the praises about so ca. without mentioning all the negatives aboout it - of which there are many - lets start with traffic traffic traffic. In my travels I have come to believe that most people (regardless of whether they live in so. ca. or somewhere else) have to find reasons to *believe* that they are living in the best spot in the world - guess it is that competitive human nature.
Most of the people in Arkansas or Arizona who like to come to IHB to crap on Irvine and OC are always screaming how much more house they can buy for the $$ in ______. That’s great, and if a big house is your calling you are in the right place. For others, climate and coastline (and maybe family) are bigger factors than indoor sq ft. So they may prefer So Cal. Neither is right or wrong, live and let live.
But for reference, please recognize this is the Irvine Housing Blog. When IR changes the name of the blog and starts profiling properties in Arkansas, I will STFU (and probably log off, because it will cease to be relevant to me). But until then, please understand that people who are focused on Irvine and OC really could give damn what it costs in your town. We all know that its cheaper out there, we don’t live in a complete vacuum. Yet about 20 million people choose to stay in So Cal for many reasons, despite the cost. I know, hard for you to believe, but true. And understand that its probably hard for us to imagine living in Arkansas—- but if you are happy, that’s what its all about.
I don’t think it is irrelevant at all - so many people I know continually justify the housing prices by talking about how everyone wants to move here - which is just not true. If people in california did not live in a vacuum to some extent - I don’t think prices would have gone where they did.
I like to be reminded of what others can buy - especially when I see a nice house like the one posted today - being reminded about what life was like outside of CA keeps me sober.
CK -
When you see a mangled car flipped over upside down on the freeway, do you say to yourself “Ah, it’s not relevant to me - I’m not going to look”?
movingaround—I don’t like it any more than you, but those things they say ARE true, there are people out there who will want to come here—- not everyone, but enough. You have noticied how many more people are here than out there? How’d that happen?
Yes—SoCal is WAY overvalued for what you get now, and if I did not live here I would NEVER dream of moving here in 2008. BUT, once prices fall back to earth (they will) and it becomes only marginally cheaper to live someplace like Minnesota—- a guy is going to be sitting there in 30 below zero weather on New Year’s Day, having just shovled his driveway for the 10th time in the week—- and flip on the Rose Bowl game. And he is going to say “I’m outta here”. Not everyone one there will say that, but some will. And our bubble pattern will start all over again. You are from here, you know the history. It is bound to repeat itself.
AZ—- I pay a premium to live in Irvine so I don’t have to get on the freeway. But as I drive up Main St every morning during my 4.2 mile commute, I do look at all those new apartment complexes under construction and think “that’s relevant, because soon those are going to house a bunch of transplants from Arizona”.
ok - but here is my truly serious question to which I have yet to get a good statistical answer - are they here because of a simple lifestyle choice - or because of jobs, jobs, jobs. I went around with this once in one of the forums and got the feeling that people don’t think it matters why people come but I do think it matters. We are back here because of a job - fact is for me many of the jobs are here in ca.
You also forget that many, many people are sitting there in the snow thinking “hmmm - want to just pop out to the ski resort around the corner?“
“ski resort around the corner”. You’ve never been to Minnesota (or Wisconsin, or Iowa, or Michigan, or Illnois, or Ohio, or Nebraska, or North Dakota, or South Dakota and so on). Unless you are talking about a cross-country ski resort, Irvine is much, much closer to a mountain ski resort than any of those places. They are COLD and FLAT.
Further to the point of the desireablity of ski resort areas, I wonder if income fundamentals support housing prices in places like Park City or Vail? I’ll bet no. Some places are unique, and will command a premium.
I lived with a ski resort around the corner from me.
Tell me you didn’t just compare Vail to Irvine… I bet income fundamentals there are less out of whack than they are in Irvine, and I bet their median income is a lot higher.
*waits for someone to post census information making me look like an idiot*
as a software/IT guy living in Irvine and working in Santa Ana (8 mile commute… could almost bike, if i wasn’t such a fat sluggard :D) I can say that it’s both.
Other non-financial restrictions applied, such as family:
1) Wife’s industry is so limited we had only 2 companies to choose from at the onset, one in Ventura, and one in deep-south OC. Irvine is the nicest area in OC that’s midway between where she works and where I used to work (downtown LA)
2) Metrolink made my commute up to downtown LA a… well, I wouldn’t say a breeze, but it wasn’t too bad. Ride the train means reading for 2 hours each day to improve my mind… or something.
3) Family members - to paraphrase a bad translation of yore: all our families are belongz to SoCal. That includes multiple aunts and uncles. They’re all within 1 hour drive from us, which might seem like a lot (I mean, an hour drive can get you across 3 national borders in Europe, IIRC) but isn’t too bad.
But, thinking back, the reason we’re here is mainly because of #3, which lead to the limited job selection of #1. And it’s pretty hard to change #3
that was supposed to be a response to movingaround’s q: “ok - but here is my truly serious question to which I have yet to get a good statistical answer - are they here because of a simple lifestyle choice - or because of jobs, jobs, jobs.“ not sure why it didn’t attach to the right astute observation. mea culpa
BHC - your situation is very similar to most of the people I grew up with - wanted to stay in CA for family - lucky enough to find a job to fit the area. Yet, those exact same people - even knowing there own situation - have told me numerous times over the past 10 years how everyone wants to come here.
On the other hand, I also know a lot of people who are gypsys because of job and many of them do not want to be in CA - how would they feel if the cost of living was equal country wide - who knows. My bet is that most people would prefer to stay close to where they grew up.
hey CK, you know I always like to get on you case
without getting defensive about what others say, if you look at it from the point that while Irvine is special :shock: there is a certain premium to what people should or can pay, the sky is not the limit, look above at AZDavid’s post which if very good on how to estimate where a house should cost based on median price and incomes. Otherwise we be drinking koolaid like most others before us just less toxic
Agree 100% MMG. In the case of today’s house, $999k is insano. But IMO $750k ($247 sq ft) would be a fair price reflective of this market. Yep, still more than Phoneix or Arkansas, but fair for here.
But I’m going to guess you this baby at about $600k?
CK
agreed with 750k in today’s market, 600K at the bottoooooom.
I lived in Arkansas for 10 years. My parents still live there. I would say that Irvine probably is superior to almost every area in Arkansas. The climate is far superior, and with the exception of a few isolated neighborhoods, the community planning and aesthetics of the built environment is awful.
movingaround: ethnicity might have something to do with it too.
I don’t have any hard data, but I fear that non-anglosaxon family of asian decent might have a hard time adjusting to, say, Arkansas or Virginia.
(I was just at Virginia and IIRC, the ‘ethnic’ restaurant there was called “Oriental Food”... then again, one could argue that if I want Chinese food so much, why don’t I move to China. *shrug*)
So, even if I don’t want to be in CA anymore, given that I’m non-Anglo… I’d probably be told “Go back to [Asian Country they might think I’m from]“ or “uh oh, the [racial epithet] are moving in, there goes the neighborhood” anywhere else. :D
Heck, we got that same treatment originally back in the 80’s from certain less-than-welcoming neighbors in the suburbs of Los Angeles.
I know its really not that funny but the ‘oriental food’ made me laugh!
I definetely think you are right - many people might not want to live in certain areas due to lack of ethnic diversity.
If I was of an Asian or even Middle Eastern ethnicity I could definetely see loving this area. For that matter I myself love the 99 market and that other market - can’t remember the name - where they have five different kinds of feta. Last place we lived there was one Chinese grocery store and it was the size of a postage stamp!
Thanks for reminding me to broaden my anglo-saxon viewpoint - excellent point!
My wife is Asian and the critcal mass of Asian culture in So Cal (not to mention all the family ties) keep us very grounded here. I doubt there are too many Buddhist temples in Arkansas—- but we can walk to one from our home in Westpark if we want to.
That’s why its annoying when these dorks come here and pop off about how great *fill in the blank* place is, and how stupid people are to live in So Cal. There is a lot more to life choices than just the price of a home.
ok, I agreed with the cultural issue - but fact is this is the very first time someone has brought this ethnicity issue up in a discussion like this of which I have been apart - and I am obviously one of those ‘dorks’ you seem so annoyed with - even though I live here.
Most often the reasons given for Ca desirability is about the sun, sand, blah, blah, blah explaining to me why ‘everyone’ wants to live here and that is why the housing prices are so high. The ethnic argument is actually the only argument that holds any ground in my experience with people living outside of CA - in fact, thinking about it the ONLY people I have known in all the places I lived back east who actually wanted to move to CA were Chinese.
I am Asian myself.
Rugs are oriental. People are Asian.
movingaround—I didn’t think you were one of those dorks at all
. I think you said you moved back here because of family, despite the flaws you see in So Cal. I too see many flaws here, but ultimately the reasons to be here outweigh the reasons to leave. I don’t dispute that other places have a lot of merit—- just dispute there is any point in comparing the two markets, because there is not a comparison between Irvine and Arkansas…Not that either is better, just that they don’t compare.
For instance, if I were to purchase a 2,000 sq foot house in Woodbury, would I present a recent sale of a 2,000 sq foot house in Mud Creek, AR as justification of my price? Not that there is anything wrong with Mud Creek, but its a pointless comparison.
And for some reason the people who like to dump on Orange County seem to have such a disdain for this place and the people here. I wonder if they have ever been here, or know any real people here—- or is all they know what they saw on “The OC”?
yes, I have encountered that disdain for California. I remember living overseas and feeling like people just couldn’t grasp that there were actually normal families living in So. ca.
However, in the exact same way, people here in CA brush off the discrepency in housing prices between other places in the US and here by immediately responding with an attitude of - “well, it is just so much better here and everyone wants to come here.“ That clearly shows their ignorance in that they don’t realize how much other places have to offer nor do they realize that in fact a lot of people don’t want to come here.
I have heard it for so long from friends and family living here while I wasn’t here that it now makes me sick - if it really was true that home prices were going up because everyone wanted to come here then I really, really wish someone would show me the statistics from the past 5-10 years to prove it - the only stats I keep hearing are those about people leaving Ca.
I think I saw a pie chart somewhere showing about a 33% Asian population in Irvine. Maybe it was a chart of students at the various schools.
Incidentally, it was around the same in San Marino and Arcadia (two other places that I saw an influx of Chinese (Republic and ex-British ones, if you catch my drift) that bumped those two markets somewhat out of proportion as far as I could tell. Like gathers around like, and the richer of those who were trying to get away from Monterrey Park and Montebello ended up in SM & A. Again, from anecdotal evidence, it seems like that influx also bumped those two school districts up, causing more people to flux in for the ‘better schools’.
So, at least from an empirical standpoint, I don’t think it was people fleeing the rest of the USA, but globally, that really bumped things up a couple of artificial notches.
So, when SM&A;became saturated, somehow Irvine caught the fever (probably since it’s school district was already doing well)
One more disclaimer, this is all anecdotal and has not statistics behind it, but it’s the kind of discussion I heard as a kid growing up.
A sample of the dialog I heard from friends of family: You’re paying how much for private school for your two kids? Why don’t you just move to San Marino?
I don’t imply one ethnicity is better or smarter than any other, just the kind of (mis)information I heard growing up in a previous bubble (where my family got burned)
You have got to love the hubris on the part of the seller and people like them who manage to scrounge up 119,000 (most of which is likely coming from the sale of a previous house that requires a first time buyer to leverage themselves further than they had to).
A buyer with 119K in cash deluded into believing that he/she is in the market for million dollar homes.
A 119K down payment sets your affordability limit around 500K (assuming you can make the payments on the remaining balance for 30 years) - certainly not 1 million.
Nice house though. It will bottom out around 550K.
Why are all the houses in Irvine so boring?
Because the land is expensive.
Where are houses “exciting”? Condo towers on the Vegas strip?
Exciting and/or interesting? Eichler homes in Orange, pre-war homes in Long Beach, homes in Floral Park, custom homes with quality craftmanship in Laguna Beach, etc.
Because they’re all built cheap cheap cheap. Its difficult to justify artisans, skilled carpenters or masonries when land is so expensive.
Very nice set of pictures. Another home I would like to buy when the market bottoms.
I think I must be the only one in Irvine that likes carpet.
Amen, brother!
What is the point of having wood floors/tile/etc. just so you can put area rugs down over them?
I like carpet. The problem is that my beverages, especially red wine, like it even more than I do.
Mops are cheaper than steam cleaners.
IR,
Given the inflationary cycle we are currently in, isn’t the effective loss on this house considerable more than 256k?
I would like to see a “Breakeven” date for each house listed. If things proceeded as typical for the real estate market (increase of 4% a year with 3% inflation) people who bought at the peak are probably looking at 10 years or so to break even. However, given the 8% inflation we are experiencing, and another 25% correction for homes like today’s listing, the breakeven point is what, 2025 maybe 2027 for today’s listing at its asking price?
Could you imagine buying a home today and waiting until 2025 just to get your money back?
Not sure I’m following you. If you bought at the peak (2005) with a fixed rate mortgage, then the dollars you borrowed are “fixed” to their 2005 value.
If we suffer through 8% inflation for a decade, then wages will lag, but they will catch-up, and they’ll bring along housing prices. If that’s your scenario, then the peak buyer won’t have to wait very long to “break-even.“
Also, a renter in this scenario isn’t hedged for the inflation with their housing cost adjusting every year to account for inflationary pressures.
If you bought at the peak, even with a fixed rate, your breakeven point is way out in the distant future. How exactly does your fixed rate to 2005 value make up for the massive loss sustained at the end of this correction? Paid 999k, it is worth 650k 6 years later and takes another 10 years to get back to 999k - hardly a short period of time to wait. And these numbers don’t account for inflation. Renter have the luxury of not actually losing money with a plummeting housing market. People who bought at the peak, and put money down, are looking at decades to recover their money.
“...Renter have the luxury of not actually losing money with a plummeting housing market…“
Renters lose the rent! There are no freebies. A peak homebuyer loses the equivalent rent + the extra costs (since we haven’t been near rent/own parody for years). The peak homebuyer is also losing equity, but a lot of housing market bears like to view all increased equity as illusory; if it is, then lost equity is illusory as well until it’s realized.
A home you live in should not be viewed as an investment. The peak homebuyer who paid $1 mil in 2005 is losing a lot of money. If this same family rented the same $1 mil house, they’d be losing a lot of money - less money lost, but still a lot of money.
Then again, money is relative. If your household income is $400k (the minimum necessary to consider the purchase of a million dollar home), then the amount you’re losing by buying or renting isn’t too great.
Realistically, if you bought anywhere near the peak (and including now) you will not get back