Trovata – Another Westpark Casualty – UPDATE #1

Address: 20 Avanzare, Irvine, CA 92606 (Westpark)
Plan: 1876 sq ft – 4/2.5
MLS: S452340 DOM: 80
Sale History: 6/03/2005: $753,000
7/30/1999: $343,000
10/30/1996: $228,000
Price Reduced: 08/26/06 — $795,000 to $775,000
Price Reduced: 10/05/06 — $775,000 to $759,900
Current Price: $759,000

This Plan 3 in the Trovata tract built by K Hovnanian was purchased with 10% down last summer for $753k. The price has been reduced a couple times and now the asking price is almost the same as the purchase price from over a year ago. It looks like a nice, clean, well kept home and 4 bedrooms at this price sounds pretty competitive. Any Westpark residents care to chime in? After 6% in selling costs, this seller will lose over $40,000 when all is said and done. That doesn’t even take into account the carrying costs of this vacant home which could be pretty substantial depending upon how long it’s been empty.

A quick look in the neighborhood reveals an identical Plan 3 for sale at 731 Paseo Westpark:

Address: 731 Paseo Westpark, Irvine, CA 92606 (Westpark)
Plan: 1876 sq ft – 4/2.5
MLS: P525054 DOM: 101
Sale History: 10/01/2001: $415,000
Price Reduced: 08/15/06 — $825,000 to $789,000
Price Reduced: 09/02/06 — $789,000 to $770,000
Price Reduced: 09/26/06 — $770,000 to $759,000
Current Price: $759,000

The private remarks for 731 Paseo Westpark say ‘VERY MOTIVATED SELLERS. MAKE AN OFFER!’. It’ll be interesting to see how this plays out with both plan 3’s priced exactly the same.

UPDATE #1 – November 4, 2006

Our non flipper at 731 Paseo Westpark made the first move by lowering their price on November 1 to $742,500. Now we wait and see if our flipper at 20 Avanzare chases the market down.

8 thoughts on “Trovata – Another Westpark Casualty – UPDATE #1

  1. oc_fliptrack

    Irvine, ground zero for poor liquidity.

    I think something like 70 homes sold in the last 30 days from an inventory of 1100+. How much longer can Irvine defy gravity?

  2. rerip2007

    LOL… Funny how these “VERY MOTIVATED SELLERS” think their less than 2000 SqFt houses are worth 3/4 of a million dollars.

    Enjoy living in your alligator home. What a joke. These POS’ should be worth $500K at most and I still wont buy them.

    Right now, some SD houses near 3000 SqFt can be had for 650K. A good bargain that will get cheaper. I expect these homes to sell for $500K in the next year and a half.

  3. imploder

    Let’s do say the median in OC drops back to 450k. Rates go up slightly to 7% and lending standards tighten after the foreclosure fallout. 20% down is 80k, which will take 7 years to save at 1k/mo. Mortgage payment on conv 30 yr loan plus about $500/mo property tax will cost you $2,930/mo. If this represents the traditional 1/3 of gross income for housing, you will need to earn $8,690/mo or 103k/year. That’s what, the top 2 % of earners? Still a lot of have-nots, or never-wills, in 2013 I suspect.

  4. IrvineRenter

    I have long been wondering how people in Irvine afford buying a 600K+ house (don’t mention the 600K- craps, they are hardly called a “house”). My household income was around 145K/year. After tax, 401K, medicare etc., we can get around $8000/month. Our rent is $2000/month. Two children’s preschool tuition takes another $1400/month. About $900/month for 2 cars (car loan, gas, insurance etc.). Groceries and other things about $900. We can save barely $30K each year. At that pace, we need 5 years to save for the downpay for a starter house in Irvine. We need 20 years to pay off the whole loan. It’s hard to imagin we live a hard life for 20 years just for that simplest house (salary raises may relief a little bit). How others managed to do that for far more expensive house?
    The official average household income is around $65K-75k. I doubt it because I know a lot of transactions in O.C went by cash which are hard to track. I once bought a piano from store by cash. They gave me discount for cash. So my guess is that average household income in O.C. should be more than $80k if include the cash income which is not taxable. How do you think? This may help to explain the high house prices. But still it is too high. Don’t want sacrifice my life for an ownership.

  5. sidelined_buyer

    IrvineRenter, per 2005 stats only 16% of households in the entire United States make over $100,000 and only 4% of individuals make that much or more. If I recall about 30% of households in Greater Los Angeles area make over $100k. My guess is that a huge percentage of these people are already homeowners. The percentage of first time buyers with 100k saved up for a downpayment and making six figure incomes is very small and not the norm at all.

    My cousin has a Mortgage co. here in SoCal for the last 20yrs, I asked him what types of people are buying these homes. He says that it’s mostly $40-75K/yr households, but sometimes 2 families together pooling in, getting into IO and NegAm loans. The other type are existing lower income homeowners cashing out equity to spend on crap. He also mentioned that the last client who refinanced with him was almost at 100% LTV on his house in the ghetto, made $11/hr at an auto parts store, wife made minimum wage. They cashed out because he wanted to buy a new set of exotic rims for his BMW, which was purchased also with a previous cash out. These lower income folks are spending their home equity like water since to them it is like they got a windfall. And get this..his FICO score was 566 and yet he was able to cash out of his house when no credit card company would touch him with a 10 foot pole. Lending standards are just a complete JOKE, its a circus!

    Most of these people are financially naive and don’t understand things like cyclical markets and that the value of their home will soon revert to where it actually belongs. Unfortunately it wouldn’t matter to them as they will just hand the keys back to the bank and walk away from their home, they have little to lose!

  6. mikey

    The O.C area is a bomb waiting to go off in my humble opinion. The high employment here is due to Home construction spending and real estate prices that have gone unchecked far too long. This creates a false belief that this city is “recession proof”. Prior to 9/11 and the tech bubble (which imploded here), O.C/Irvine was a relatively affordable city. Real estate prices here were low compared to other cities like San Francisco. The high paying jobs in high tech has been disappearing and so will the market for high end housing. Regular local/gov’t jobs that are not cyclical just do not pay exorbitant salaries and that is the main industry here.

  7. MD

    sideline buyer

    I was talking with a couple of friends who make pretty good money, for some reason everyone is under the impression that most people in the OC are making above 200k. maybe its because of all the expensive houses and nice cars, crowded restraunts. I know for a fact that this is not possible. eventhough I tell them that most people probably fall in the 50k-75k, with a bigger percentage making above 100k(combined income)than the national average, I still can’t explain how people are spending so much money.
    a few years ago it was very hard to get loans, now anyone can get them, but how on earth are people spending that much money. I wonder if people are oblivious to economics and still believe that their houses will rescue them.

  8. oc_fliptrack

    MD, I knew something was wrong when I heard a local refer to a $58k salary as a pittance. It’s only $8k below the Irvine median yet somehow it’s a ticket to the Top Ramen Poorhouse. I guess it *would* drive you to the poorhouse if you tried to keep up with the Joneses on it. OTOH, most of the country would kill to earn that salary.

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