Irvine Housing Blog

It’s a great time to buy. Yeah right.

Anyone remember 18% mortgage rates? I do. Think it can’t happen again? This guy does.

“Oh, and having done that, the long end of the curve would probably still spike to 10%, which means 13-14% mortgage rates.  Cut the value of every house in America in half - again - from here.”

http://market-ticker.org/archives/622-Fiscal-Cat-5-Hurricane-Warning.html

here is a chart of equity withdrawal for responsible renters and home owners:

The elimination of MEW hits the global economy like a freight train.  Now the debtors are praying to the hyper inflation gods. (hey, it worked during the bubble)  The next chart to superimpose over the MEW chart with a time lag is unemployment. 

Am I the only one who is enjoying deflation?  Granted, we all may lose our jobs (realistically maybe 1-2 out of 10 of us)... but if you have been a saver you are well positioned, provided you are not greedy.  The fact that you can survive in a slower world where food still grows and the sun still shines should put a smile on your face.  It’s all about perspective.

Yesterday’s profiled property on Iroquois just went into escrow…

Why are they playing up that kitchen? It looks like a kitchen in some sort of institutionalized setting.

I have heard of going neutral but painting it all why like that is something you do before you try renting it, otherwise I just want to put on a jack, hat and gloves it looks so cold.

NEW YORK (CNNMoney.com)—Former Federal Reserve Chairman Alan Greenspan told a House committee Thursday that the nation will emerge from the current credit crisis with a “far sounder financial system.”

Bull.  The problem is not the system.  The problem is the people in charge of overseeing the system and making sure that the store is being properly tended to.  It’s like every police officer in the country not showing up to work and then the police chief saying that we will emerge from the anarchy with a much sounder system of law.

“We are in the midst of a once-in-a century credit tsunami,” Greenspan told the House Oversight and Reform Committee.

As though the problem is some random occurrence completely unpredictable and uncontrollable.

Because of their hard-won experience, markets “will be far more restrained than would any currently contemplated new regulatory regime,” he said.

The bank bailout is sure going to show those bankers what the school of hard knocks is all about.

“Investors, chastened, will be exceptionally cautious,” he added.

In other words, nobody is going to want to invest in U.S securities.  Fantastic, I can see the light at the end of the tunnel.

Greenspan said he made a mistake in presuming that lenders themselves were more capable than regulators of protecting their finances. He said he was “shocked” when that system “broke down.”

“I still do not understand exactly how it happened,” said Greenspan.

One word: WOW.  It looks like that man behind the curtain has finally been revealed.

We are in the midst of a once-in-a century credit tsunami,” Greenspan told the House Oversight and Reform Committee.

Great Depression: 1932
Great Unwinding: 2008
2008-1932 = 76 years

Century - a span of 100 years

Thus, at least 2 tsunami’s in a 100 years.

Glad Alan can count

This property already has 5 offers. I’d expect it to enter escrow in the next day or so.

There are a few other flips in the area. Seems like a target rich environment for anyone with cash to buy low and sell high.

go take a look at the house and the community after 9:30PM, you will say “no”

Going into escrow and being sold are very different birds.  In my neighborhood i have seen homes with SOLD signs on them, later to see that same SOLD sign taken down.  And again, I hope these irrational people that think that these prices are a steal, have a job next year to pay the almost half million note they have, they might be joining all the other spec’s in the soup line.

In the esteemed opinion of those on the board, is $306,000 a good price for this unit?

IR or someone else please comment:

A flipper bought this for $306k and the property had a first mortgage on it for $440k.

I understand in a high percentage of the bank auctions its merely a formality with the bank bidding the amount owed and then giving it to a real estate company to sell as a REO.

What influences a bank to NOT bid on this or any other auction property where they own the first allowing it to be bought by someone for much less? It seems like even in the worst of cases they are leaving money on the table.

Is there a second or other issues that this flipper has/had to pay or is the flipper indeed going to pocket this huge profit?

I’m interested to understand the process in the generic case just as much as this property in particular.

Thanks to all you and IR especially for the education of this site.

I can imagine that these REOs might have leins for HOA fees and property taxes that have to be cleared.

Not sure if you get a free look, but if you go over to ForeclosureRadar.com you’ll see that a lot of houses have firsts alone that are worth more than the value of the house currently.  For quite a long time the banks were taking homes back by the score because no one would offer a bid over their opening amount, which was usually the first mortgage.  When you look at the data over there you’ll see that (i only look at orange county, don’t know if this is true for other areas) that the banks are postponing many, many more foreclosures these days, presumably because they’re working things out with the homeowners.

Ha ha suckers I read yesterday that of that $700 billion that was so necessary to commit a full $70 billion (10%) is going to employee bonuses this year. Stellar performance demands rewards.

Schwarzenegger just proposed a program much like Mc Cain’s since he now realizes that property valuations are the base of property taxes and must be maintained or the whole LOCAL gov’t collapses.
Got to keep the cops paid when you create an economy like this-

I watched a similar thing in Calabasas.  One stupid couple who thought that they were brilliant real estate investors let four homes go into foreclosure at once.  All by themselves, they are causing bank losses in the millions of dollars.

I always hated kitchen sinks that face the wall because it feels like your being punished.

Perfesser Civix never tires of reteaching hiz lovely students about the tripartite American government.
You see the budget is created by the body which makes the laws, the Legislative branch called the Congress.
The President or Executive branch ENFORCES (or at least is supposed to) the laws and the Judicial (Supreme Court) branch which interprets the laws.

The Congress under Clinton was Republican-dominated, which accounts for the slow increase which people who don’t understand the structure of our government attribute to Clinton.
Likewise the rapid increase under Bush corresponds to the time when the Congress became dominated by Democrats, even though it’s blamed by some on Bush, who I guess was culpable because he didn’t veto the budgets presented to him, probably because his veto would have been overridden by the large Democratic majority anyway.

Don’t you remember the hullabaloo about Bush SIGNING/approving the budget? Is that not indication enough that it was created elsewhere, in this case the Congress?
Congress sets policy and taxes. If people were better informed about the workings of their government we could spend a whole lot less time talking past each other.