I agree with Irvine Renter that the best time to buy your Irvine home is when interest rates are high and home prices are low. 2009 is definitely too early to buy in Irvine. I am afraid with the government’s stimulus package and low mortgage rates, home prices in Irvine and the rest of OC may be just flat-line for the rest of the year (down 5 - 10%). I just don’t see the 20% drop in Irvine happening until we see mortgage rates reach 8 - 10%. The question is how soon are we going to see 8 - 10% mortgage rates? How many of you forsee the biggest drops occuring for Irvine between 2011 - 2013, and not in 2009 - 2010?

For example: Manzanita Plan 2 in Portola Springs was selling for $804,900 in Jan 7, 2008. As of Jan 7, 2009 that same model is still selling for $804,900. Manzanita dropped 0% for one entire year. Did i tell you that zip code 92618 actually was in positive territory in 2008?

$804,900 for a freakin 2500 square feet detached condo with crazy HOAs and 1.9% Tax (serious wallet drainer)...!!!

I feel it in my gut that 2011 - 2013 is probably going to be the bottom. Are most of you guys planning to wait this long? I really hope that mortgage rates start to make some strong moves upward before end of this year.

I love Awgee’s plan to join the elite FCBs by putting 100% down when mortgages rates shoot up to 8 - 10% between 2011 - 2013. I know that is the way to do it, but I don’t know if i have Awgee’s patience.

If rates return to 10%, prices after adjusting for inflation, will fall another 40% of today’s values.

PANDA - 08 January 2009 03:23 AM

I agree with Irvine Renter that the best time to buy your Irvine home is when interest rates are high and home prices are low. 2009 is definitely too early to buy in Irvine. I am afraid with the government’s stimulus package and low mortgage rates, home prices in Irvine and the rest of OC may be just flat-line for the rest of the year (down 5 - 10%). I just don’t see the 20% drop in Irvine happening until we see mortgage rates reach 8 - 10%. The question is how soon are we going to see 8 - 10% mortgage rates? How many of you forsee the biggest drops occuring for Irvine between 2011 - 2013, and not in 2009 - 2010?

For example: Manzanita Plan 2 in Portola Springs was selling for $804,900 in Jan 7, 2008. As of Jan 7, 2009 that same model is still selling for $804,900. Manzanita dropped 0% for one entire year. Did i tell you that zip code 92618 actually was in positive territory in 2008?

$804,900 for a freakin 2500 square feet detached condo with crazy HOAs and 1.9% Tax (serious wallet drainer)...!!!

I feel it in my gut that 2011 - 2013 is probably going to be the bottom. Are most of you guys planning to wait this long? I really hope that mortgage rates start to make some strong moves upward before end of this year.

I love Awgee’s plan to join the elite FCBs by putting 100% down when mortgages rates shoot up to 8 - 10% between 2011 - 2013. I know that is the way to do it, but I don’t know if i have Awgee’s patience.

No one has Awgee’s patience, including Awgee.

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

mortgage rates aren’t going up until the government stops manipulating the market which means that rates will be low for many years.

rickhunter - 08 January 2009 05:04 PM

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.  The idea that it is overthinking to consider factors other than affordability sounds like more realtor nonsense.

asianinvasian - 08 January 2009 07:47 PM

Does anyone know what money market rates were paying between 1982 and 1984?

I think what’s stupid is people sitting around trying to ask/predict/answer the following…like they know it to be true.

1. Mortgage Rates going up in 2011?
2. Market bottoming in 2011?
3. When’s the best time to buy?

The overthinking part implies that one should not try to PREDICT the future!

And has nothing to do with what’s best for yourself because only you would know that.

awgee - 08 January 2009 05:51 PM

rickhunter - 08 January 2009 05:04 PM

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.  The idea that it is overthinking to consider factors other than affordability sounds like more realtor nonsense.

.  need to edit.

awgee - 08 January 2009 05:51 PM

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

rickhunter - 08 January 2009 08:28 PM

I think what’s stupid is people sitting around trying to ask/predict/answer the following…like they know it to be true.

1. Mortgage Rates going up in 2011?
2. Market bottoming in 2011?
3. When’s the best time to buy?

The overthinking part implies that one should not try to PREDICT the future!

And has nothing to do with what’s best for yourself because only you would know that.

awgee - 08 January 2009 05:51 PM

rickhunter - 08 January 2009 05:04 PM

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.  The idea that it is overthinking to consider factors other than affordability sounds like more realtor nonsense.

It is stupid to insist that one has to PREDICT the future in order to time markets.  One has to be able to objectively analyze, not predict.
Mortgage rates will go up.  I do not know exactly when, but knowing exactly when is unnecessary.
2009 is not the bottom for the re market, nor is 2010.  You can say I do not know all you want, but so far I have done much better than those who have listened to realtors tell them they can’t predict the market and the best time to buy is when they can afford it.
The best time to buy depends on many factors, not just when you can afford it.  I could afford to buy in 2006 and would have lost who knows how much percentage by now.  That would not have been the best time to buy.

Our schools really need to teach logic, logical fallacy, and critical thinking.

asianinvasian - 08 January 2009 09:57 PM

awgee - 08 January 2009 05:51 PM

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

If you are basing your definition of genius of whether I have accumulated wealth rather than lost it as a result of selling in 2005, investing, and leasing, (for a hell of alot more than $2,500), than I am a genius.
Personally, I would not define genius in that manner, as there are folks who post here who I know are way smarter than me, and they have probably accumulated less wealth in the past few years, but you are not one of them.

Just a guess; you have been wisely investing in paying interest on a mortgage and paying down principal on a depreciating asset, when you could been leasing for half whatever it is you are spending.  Brilliant.

awgee - 08 January 2009 10:03 PM

rickhunter - 08 January 2009 08:28 PM

I think what’s stupid is people sitting around trying to ask/predict/answer the following…like they know it to be true.

1. Mortgage Rates going up in 2011?
2. Market bottoming in 2011?
3. When’s the best time to buy?

The overthinking part implies that one should not try to PREDICT the future!

And has nothing to do with what’s best for yourself because only you would know that.

awgee - 08 January 2009 05:51 PM

rickhunter - 08 January 2009 05:04 PM

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.  The idea that it is overthinking to consider factors other than affordability sounds like more realtor nonsense.

It is stupid to insist that one has to PREDICT the future in order to time markets.  One has to be able to objectively analyze, not predict.
Mortgage rates will go up.  I do not know exactly when, but knowing exactly when is unnecessary.
2009 is not the bottom for the re market, nor is 2010.  You can say I do not know all you want, but so far I have done much better than those who have listened to realtors tell them they can’t predict the market and the best time to buy is when they can afford it.
The best time to buy depends on many factors, not just when you can afford it.  I could afford to buy in 2006 and would have lost who knows how much percentage by now.  That would not have been the best time to buy.

Our schools really need to teach logic, logical fallacy, and critical thinking.

Huh? Panda’s posting is

When are we going to see mortgages rates going up to 8-10%

What kind of data and analysis are you going to use to answer this? It’s called a PREDICTION and it’s a worthless one.

My decision to sit and wait has nothing to do with timing the market…blah blah blah
I dont need analysis etc. to know that I dont want to pay this current price.
Does it have to be more complicated than that?

On the otherhand, if someobody came to me and asked me, when it’s the best time to buy in general…
I’m going to say..

WHEN YOU CAN AFFORD IT!

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.  i am of course referring to real estate in the bizarro world.

rickhunter - 08 January 2009 10:34 PM

awgee - 08 January 2009 10:03 PM

rickhunter - 08 January 2009 08:28 PM

I think what’s stupid is people sitting around trying to ask/predict/answer the following…like they know it to be true.

1. Mortgage Rates going up in 2011?
2. Market bottoming in 2011?
3. When’s the best time to buy?

The overthinking part implies that one should not try to PREDICT the future!

And has nothing to do with what’s best for yourself because only you would know that.

awgee - 08 January 2009 05:51 PM

rickhunter - 08 January 2009 05:04 PM

For the average person,

The best time to buy is when you can afford to do so!

Dont overthink or make things more complicated than that…

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.  The idea that it is overthinking to consider factors other than affordability sounds like more realtor nonsense.

It is stupid to insist that one has to PREDICT the future in order to time markets.  One has to be able to objectively analyze, not predict.
Mortgage rates will go up.  I do not know exactly when, but knowing exactly when is unnecessary.
2009 is not the bottom for the re market, nor is 2010.  You can say I do not know all you want, but so far I have done much better than those who have listened to realtors tell them they can’t predict the market and the best time to buy is when they can afford it.
The best time to buy depends on many factors, not just when you can afford it.  I could afford to buy in 2006 and would have lost who knows how much percentage by now.  That would not have been the best time to buy.

Our schools really need to teach logic, logical fallacy, and critical thinking.

Huh? Panda’s posting is

When are we going to see mortgages rates going up to 8-10%

What kind of data and analysis are you going to use to answer this? It’s called a PREDICTION and it’s a worthless one.

My decision to sit and wait has nothing to do with timing the market…blah blah blah
I dont need analysis etc. to know that I dont want to pay this current price.
Does it have to be more complicated than that?

On the otherhand, if someobody came to me and asked me, when it’s the best time to buy in general…
I’m going to say..

WHEN YOU CAN AFFORD IT!

That is probably why no one asks you.

On the otherhand, if someobody came to me and asked me, when it’s the best time to buy in general…
I’m going to say..

WHEN YOU CAN AFFORD IT!

That is very short sighted almost stupid statement.

What you could buy for 700k two years ago is much less desirable then what you could buy today for that. 

So you are saying don’t worry about the value of what you can buy.  I guess if you want less house for more money that is a great philosophy.

I bet the people that could afford to buy a home two years ago and took that advice are not to happy today!

asianinvasian - 08 January 2009 09:57 PM

awgee - 08 January 2009 05:51 PM

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

Agreed.  The housing bubble has made EVERYONE who was part of the first-time-buyer pool the past 8 years spend more money on keeping a roof over their head and will continue to do so for the forseable future.  This is in comparison to if the lending environment had been the normal, sane 20% down, 28% DTI on a 30 year fixed.  Renting really is “throwing money away”.  Although renters have been throwing a lot less of it away compared to the homedebtors during this bubble.

Thank your leaders for this situation.  Yet, incumbants were recently voted back into office, so I guess everyone is okay with the situation.

trrenter - 08 January 2009 10:49 PM

On the otherhand, if someobody came to me and asked me, when it’s the best time to buy in general…
I’m going to say..

WHEN YOU CAN AFFORD IT!

That is very short sighted almost stupid statement.

What you could buy for 700k two years ago is much less desirable then what you could buy today for that. 

So you are saying don’t worry about the value of what you can buy.  I guess if you want less house for more money that is a great philosophy.

I bet the people that could afford to buy a home two years ago and took that advice are not to happy today!

He must mean something else.
Otherwise, should you buy a new car because you can afford it?
A new airplane?
Skateboard?
Nursery?
Trip to Europe?
Refridgerator?
Affordability is only one factor of many when deciding on making a purchase and to try and simplify the process to just one factor is ... , well ..., stupid.
RickHunter is not stupid, so either he means something else, or he has just not thought this through.

Major Schadenfreude - 08 January 2009 10:55 PM

asianinvasian - 08 January 2009 09:57 PM

awgee - 08 January 2009 05:51 PM

That is just plain stupid.  Many of us can afford to buy now and have been able to buy since 2005 or 2006 or 2007 or 2008.  And waiting to buy is working out rather well.

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

Agreed.  The housing bubble has made EVERYONE who was part of the first-time-buyer pool the past 8 years spend more money on keeping a roof over their head and will continue to do so for the forseable future.  This is in comparison to if the lending environment had been the normal, sane 20% down, 28% DTI on a 30 year fixed.  Renting really is “throwing money away”.  Although renters have been throwing a lot less of it away compared to the homedebtors during this bubble.

Thank your leaders for this situation.  Yet, incumbants were recently voted back into office, so I guess everyone is okay with the situation.

You can call it whatever you want, but more than once I have calculated the difference between renting and owning and when figuring everything, including ROI, renting is throwing less money away right now.  I don’t get it.  Haven’t you read any of IRs articles on the cost of renting vs. owning?  There are cross points at which one becomes more or less expensive than the other.

acpme - 08 January 2009 10:40 PM

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.

Thanks acpme.  What awgee doesn’t realize is the 120k he spent on rent he will never get back.  But if his house loses 120k in equity he will get that back unless he is a house flipper.

asianinvasian - 08 January 2009 11:20 PM

acpme - 08 January 2009 10:40 PM

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.

Thanks acpme.  What awgee doesn’t realize is the 120k he spent on rent he will never get back.  But if his house loses 120k in equity he will get that back unless he is a house flipper.

are you dim?

that $120k, had he bought instead, would be gone now (it went to pay interest, very little to principal in the first few years), and since the average house price is now early 2004, he would likely have lost his down payment too!

asianinvasian - 08 January 2009 11:20 PM

acpme - 08 January 2009 10:40 PM

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.

Thanks acpme.  What awgee doesn’t realize is the 120k he spent on rent he will never get back.  But if his house loses 120k in equity he will get that back unless he is a house flipper.

awgee realizes everything just fine.  You don’t seem to understand the simplest basics of consumer finance.

freedomCM - 08 January 2009 11:49 PM

asianinvasian - 08 January 2009 11:20 PM

acpme - 08 January 2009 10:40 PM

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.

Thanks acpme.  What awgee doesn’t realize is the 120k he spent on rent he will never get back.  But if his house loses 120k in equity he will get that back unless he is a house flipper.

are you dim?

that $120k, had he bought instead, would be gone now (it went to pay interest, very little to principal in the first few years), and since the average house price is now early 2004, he would likely have lost his down payment too!

dim sum?

No one said anything about interest.  If you don’t want to pay interest then pay off the mortgage, or better yet, don’t get one to begin with, like us asians!

asianinvasian - 08 January 2009 11:20 PM

acpme - 08 January 2009 10:40 PM

asianinvasian - 08 January 2009 09:57 PM

Rather well for who?  If you pay $2,500/month for rent you just threw $120,000 out the door since 2005.  Congratulations, you’re a genius.

i agree with AI.  if you had bought that home instead of renting, you wouldn’t have lost any money since 2005.

Thanks acpme.  What awgee doesn’t realize is the 120k he spent on rent he will never get back.  But if his house loses 120k in equity he will get that back unless he is a house flipper.

I know of a family that aren’t house flippers. They bought a home in Riverside for 840K, currently worth 310k?!?!  According to your theory a house flipper won’t get his money back but this family will?
This family at the time felt it was the right time to buy and that they can afford it.  They still can afford it, but they are sick about it everyday. 
Regardless of a flipper or a permanent resident do you think this family will ever see their home at 840K again? As a numerical figure maybe…30 years from now. But inflation adjusted…never.  Unless their home has an undiscovered oil field or several tons of limestone sitting underneath it.

Throwing money away is a valid claim to make when rent variance is very small compared to the morgage you would be paying for the same unit.  The question is what you do with the extra savings.  What is your opportunity cost.  Housing is an investment just like everything else, but if its giving you a negative return while you could be placing that cash in something that gives you a positive return then you’re the moron for ignoring it.

I’m in a different boat all together.  I would rent the rest of my life to be honest just because my cost of placing 20% down or more is astronomical compared to what others might calculate.  I don’t include a 5% rate of return as my loss of opportunity on 20% down.  I calculate a much higher rate compounded out 30 years.  So unless the home is appreciating, I have a hard time even putting 20% down on a home that has equal rent/morgage ratio.  150K x r% x 30yr = $$$,$$$,$$$

This board has been existent for a couple or years now with thousands of posts and it seems like some folks have learned nothing.  I give up.