Asking Price: $879,500
Purchase Price: $869,000
Purchase Date: unknown
Address: 39 Bamboo, Irvine, CA 92620
Beds: 4
Baths: 4
Sq. Ft.*: 2,492
Year Built: 2004
Stories: 2
Type: Condominium
Neighborhood: Northwood
$/Sq. Ft.*: $353
MLS: S477978
Status: Active on market
On Redfin: 23 days
Do you get the feeling flippers are getting nervous? There are 46 addresses on Bamboo Street in the Northwood neighborhood adjacent to Woodbury; 7 of them are for sale. 41 Bamboo just sold on 2/13/2007 for $820,000, so there is activity in the area. There are 7 other homedebtors looking for the greater fool to save them. The owners at 39 Bamboo just got nervous and decided to sell even if it is at a loss. Zillow thinks the property is worth over a million dollars. Apparently the market does not agree.
Real estate always goes up, or so buyers are bamboozled into believing by realtors. It only takes a few nervous neighbors to drive down property values in an entire neighborhood. Comps are set at the fringes where the transactions take place. I’m sure the owner at 57 Bamboo would like to make his $211,106, but it is more likely that 39 Bamboo is going to lose his $42,740 first.
Let’s hope they don’t change the name of the street from Bamboo to Bamboozal…..$350 per square foot….wow
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$879,500 for a condo? Are these units detached?
Irvine apparently hasn’t yet seen the future when it comes to depreciation: check out what’s happening in Sacramento (a favorite town for out-of-the-area “investors” from S.F. and L.A.):
http://flippersintrouble.blogspot.com/
That site is a testament to flippers who bought last year with dreams of $$$ dancing in their heads, but are now in trouble when the market has turned.
Hey Dave, the future for Irvine was documented very well yesterday by Bloomberg.com.
Tidbits:
“In Irvine, where just nine months ago office vacancies approached a three-year low, home prices were at an all-time high, and unemployment was less than the national average, at just 3.6 percent, the unraveling subprime mortgage market is ruining the recent prosperity.”
“At Phillips Auto in nearby Newport Beach, California, no one from the mortgage industry is shopping for Porsches these days, said Theresa Seradsky, the dealership’s general sales manager. Instead, they’re putting their Porsches up for sale through the consignment program, she said.”
“For Irvine’s 190,000 residents, the median price for new and resale houses and condominiums was $641,500 in February, down 17 percent from last June’s peak of $775,000, according to La Jolla, California-based DataQuick Information Systems. The city’s median home price is still almost triple what it was a decade ago.”
“As recently as last year, loan officers were getting annual pay of as much as $200,000, said Charlyn Cooper, a former manager at subprime lender Secured Funding based in nearby Costa Mesa. Now they’re being offered low-paying jobs in call centers.”
Yeah, thanks; I saw that article, too.
Funny, as I was remembering all the denial of those mortgage buyers in O.C. who said a housing bubble burst wouldn’t effect THEIR area, with the time-worn mantra, “but, but, we’re DIFFERENT”.
Yeah, right: Irvine is in for pain in a much worse manner. Even Christopher Thornberg (UCLA economist) back in Early 2006 perdicted problems when he mentioned how O.C. would pay for it’s involvement in sub-prime mortgage. Irvine will be particularly hard-hit, as all those O.C. sub-prime companies have downsized/folded, putting most of those over-paid employees out on the streets on their ears. That doesn’t begin to include the general trickle-down effect in the REIC….
I’m sorry, 200K for being a loan officer? You have got to be kidding me!
Well, that’s typical pay for the majority, but the ethical ones make significantly less…. ; )
Why I love to read the whining on this site is unclear. I’ll likely get over it and move-on in time.
When residential real-estate hits the skids, it has always bounced back. Take for example when real-estate hit a tuff-patch in 2000. I bet Irvinerenter would of liked to have bought then–durring that overpriced market. Many of those homes have appreciated and sold with a 50-100% gain.
As for the sub-prime, fraud and flipper crowd; I can only say the quality of their involvement will be the measure of their reward.
Some will accuratly point out year 2000 was different. You bet your Y2K it was. Then, sub-prime was just gaining traction. The smart sub-primer’s anointed in 2000 refinanced to fixed 2002 and reduced their basis. The not so smart refinanced to another variable, pulled out their equity to squander to your hearts glee.
Like bad dog food, all the fall-out is not yet known.
I think I know however where we will find the bottom of this single-family home price adjustment in the $500k-$1.2m market.
My sense is the floor will be found when an ‘investor’ can aquire a property for 10-20% down, with fixed financing, lease the property and break-even, except for property taxes, off-set by taxable income.
Then, prices again will climb along with smart money. Simple math.
To make sense of ‘live-in’ home ownership, the long view must be taken. It is best to buy what you can afford while making a stable living.
Lastly, coastal Southern California has the best weather on the planet with a stable government. International cash is huge, waiting on the sidelines, smelling for the bottom.
The sky is not falling. This is an adjustment that, over years, will pay in spades. No accurate historical graph shows otherwise.
My sense is the floor will be found when an ‘investor’ can aquire a property for 10-20% down, with fixed financing, lease the property and break-even, except for property taxes, off-set by taxable income.
Then, prices again will climb along with smart money. Simple math.
I 100% agree.
Bummer to reach that point is a 50% drop in market prices (or more).
Oh… you do know rents traditionally drop during recessions?
A POV,
I don’t know where you’re coming from. Southern California home prices have always bounced back. But in a definable range (6X to 8X median income). The current 11X+ range is simply not sustainable. Also, look at all the MEW that’s gone on.
Your argument will carry weight…
In about 3 years by my estimation.
Oh… Simple math. I’m renting for $1735/month. To buy doubles that. Traditionally, one comes out ahead after owning by at least the home’s purchase price (assuming normal appreciation). Today, if you bought one would come out behind by half the sales price of the house. (compared to renting).
So we wait.
Oh, this is the 3rd major Southern California real estate crash that I’ve witnessed in my life. The worst one saw homes in my parent’s neighborhood drop in value 40%. Guess what, this time is probably going to be worse.
Got popcorn?
Neil
A POV,
I am not sure how to respond to your post. It started out like you wanted to pick a fight,
“Why I love to read the whining on this site is unclear… I bet Irvinerenter would of liked to have bought then–durring that overpriced market.”
but then in the middle you made a statement I totally agree with,
“My sense is the floor will be found when an ‘investor’ can aquire a property for 10-20% down, with fixed financing, lease the property and break-even, except for property taxes, off-set by taxable income.
Then, prices again will climb along with smart money. Simple math.”
then at the end, you lost me again with,
“The sky is not falling. This is an adjustment…”
Have you checked the math recently? A 40% or greater decline is in the math. That would probably be considered a falling sky by most people. I suppose it is a matter of perspective.
https://www.irvinehousingblog.com/2007/03/11/predictions-for-irvine-housing-market/
A POV,
Of course it will bounce back. The question is just “when and for how long?”
SoCal does have great weather. The government is ok, but the state itself is strapped. Coupled with the unpredicatable natural disasters (who had any idea Malibu of all places would burn?) a serious immigrant problem and some of the most leveraged residents in the country make it fertile ground for some crazy economic volatility. When things are great, they are reall great and when they are bad….
The state of CA is like a manic depressive with multiple personality disorders with delusions of grandeur.
I still wanna move there someday from Chicago…. 🙂
SocalWatcher,
I beat you to it. I moved to SD from Hinsdale 2+ years ago and I have a front row seat to watch this debacle unfold from 1800sqft rental home. I miss the food in Chicago though. The only consolation is that Portillos opened up a place in Buena Park, Ca 😉
APOV
As far as international cash on the sidelines…bring it on. The last time that happened… maybe you forget… was when the Japanese bought at the top of the previous cycle… You might also forget that they were creamed as a result. Americans will always accept foreignors cash. But if you are a foreignor, don’t expect all you cash back if you buy at the top.
I hear China has privatized ownership of land, and has no capital gains taxes; wonder if China will allow foreigners to buy?
Dave:
Maybe you are just being playful, but buying in the second and third world is ill advised. A good part of this region of the world allows only 49% foreign ownership. Corruption and cronyism are of course rampant. One false move on your part (or your partners) and your deal can be vaporized. Just the same, Irvinerenter would be pleased to learn long-term leases tend to be stable and more advisable.
Interestingly, lack of capital gains (and deposit of funds reporting) in S/E Asia has made for a white-hot real-estate market in places like Vietnam and Cambodia. Since 9/11, the US has really strong-armed the likes of Switzerland for financial transparency. Lots of ‘world’ money fled Europe for this reason and is now squirrelled away in Asia real-estate.
In Phnom Phenh, Cambodia for example, the humble downtown land trades at over $500.00USD per square-meter. A nice 1/2 acre home site, of unimproved land, near town, along the Mekong River, is selling north of $750kUSD. On the other hand, once you have your land (at least 49% of it) things get easier. Labor and domestic materials (except wood and steel) are cheap. A cinder block home clad with marble and granite, in and out, can be built for about $50.00 a square foot. Once your home is done, no reason to install sprinklers for the dry season when you have staff at $65.00 per month. For the more complex issues of daily living, $200.00 per month will secure you an English speaking, college educated, young man or woman as your interpreter, driver, bidder/negotiator and cultural consultant.
As a great primer for those interested in greater Asia consider, One Billion Customers. Lessons from the front lines of doing business in China by James McGregor.
I love traveling the world. But when it comes to buying in Asia, call me ‘renter-son’, distant cousin of ‘Irvinerenter-son’.
It would be interesting to hear from first-generation Asian folks, that are here, to comment, correct and/or expand on this subject.
I bet most Asian mortgage-holders in Irvine don’t think the sky is falling as this blog defends. By culture, family and philosophy, I perceive a good number of Asians may likely take the long view in buying a home here in Irvine: Buy what you can afford. Reduce debt as fast as you can. Enjoy the good times. Endure the tough times. Live within your means. Consumer debt is shameful. Protect and work hard for your family.
A POV