I Don't Care Anymore

I Don’t Care Anymore — Phil Collins

I dont care what you say
We never played by the same rules anyway.

There are some listings where you can tell the owner just doesn’t care anymore. Put yourself in his shoes: the house you own is worth far less than you paid and far less than you owe. There is no way you can sell it for enough to get any of your money back, and your credit is shot. Why would you care?

There was a time when people purchased houses because they wanted to provide a home for their family. They took on debt they could reasonably afford, and they made payments until they sold. If they made a little money in the transaction, that was a bonus. Once prices started going up, and people saw that could make a great deal of money by owning, the profit motive started to creep into their thought process. Once prices really went up a lot, and did so very quickly, profit became the primary motivation for buying real estate. The fact that they could live in the place while they were making a fortune was a bonus. That is still the psychology dominating our real estate market, and it is the primary motivation behind the continued activity of knife catchers buying at what are still grossly inflated prices locally.

In time this psychology will change. Lenders are no longer going to enable speculation with 100% financing and liar loans, and worse yet, they are actually going to require people to pay off mortgages. Serial refinancing is over. Oh the horror of it. Can you imagine what will happen to prices when people start believing they will actually have to pay off the debt from their wage income? The Ponzi scheme of ever-increasing debt where each buyer was more leveraged than the last has come crashing down. It is only the few knife catchers who believe they will get to pass this debt on to someone else who are willing to buy in this market. We should probably thank them. Someone has to absorb the losses between today and the eventual bottom.

3 Ash Tree Ln Kitchen

Asking Price: $539,900IrvineRenter

Income Requirement: $134,975

Downpayment Needed: $107,980

Monthly Equity Burn: $4,499

Purchase Price: $675,000

Purchase Date: 7/31/2006

Address: 3 Ash Tree Lane #95, Irvine, CA 92612

Beds: 3
Baths: 3
Sq. Ft.: 1,960
$/Sq. Ft.: $275
Lot Size: 3,000

Sq. Ft.

Property Type: Single Family Residence
Style: Traditional
Year Built: 1969
Stories: 2
View: Park or Green Belt
Area: University Park
County: Orange
MLS#: S547423
Source: SoCalMLS
Status: Active
On Redfin: 60 days

Welcome Home!!!! Charming 3 bedroom home with a nice open
floorplan………separate formal dining room perfect for the
holidays……nice kitchen with a breakfast bar……romantic fireplace
just in time for winter and fall……large master with a private
balcony…….walk in closet…….and a private yard. Walking distance
to the association’s amenities, shopping and freeways. Great property
in University Park!!!

I like to use an ellipsis, particularly when there is more to a particular thought. What is the point of the series of periods above?

And of course, there are the obligatory multiple exclamation points.

The property was purchased as a flip right at the peak. The owner paid $675,000 on 7/31/2006. He used a $540,000 first mortgage a $100,000 HELOC and a $35,000 downpayment. On 11/15/2006 he refinanced with an Option ARM for $576,000 and took out a HELOC for $72,000. If this property sells for its current asking price, the total loss will be $167,494 after a 6% commission. There are much better deals in University Park, so it isn’t likely this will sell for its asking price.

I hope you have enjoyed this week at the Irvine Housing Blog. Come back next week as we
continue chronicling ‘the seventh circle of real estate hell.’ Have a great weekend.



Well you can tell evryone Im a down disgrace
Drag my name all over the place.
I dont care anymore.
You can tell evrybody bout the state Im in
You wont catch me crying cos I just cant win.
I dont care anymore I dont care anymore

I dont care what you say
I dont play the same games you play.

cos Ive been talking to the people that you call your friends
And it seems to me theres a means to and end.
They dont care anymore.
And as for me I can sit here and bide my time
I got nothing to lose if I speak my mind.
I dont care anymore I dont care no more

I dont care what you say
We never played by the same rules anyway.

I Don’t Care Anymore
— Phil Collins

43 thoughts on “I Don't Care Anymore

  1. AZDavidPhx

    It may seem difficult to believe, but the psychology is still out there that real-estate is a great investment and that now is surely the time to buy since prices are lower than they were at this time 1 day ago.

    Of course, the people who tell you that now is the time to buy are the exact same ones who give you a blank stare when you ask them to explain how the bubble inflated in the first place. You ask them about the debt-to-income affordability and they look at you and shrug.

    When people start talking about the economy bouncing back and house prices taking off, the first question that I immediately ask is the following:

    “Wouldn’t it be better for the economy if housing was much cheaper so that I would not spend as much money on shelter and have more left over to buy Ipods and Escalades with?”

    “Aren’t soaring house prices actually bad for the economy since it causes more and more people to take on more and more debt with little money left over for Ipods and Escalades?”

    I typically chalk these types of personalities up to the stereotypical lazy free-lunch American who wants to achieve riches with the most minimal of effort. It’s like the gambler winning 100K on a game of BlackJack and immediately drawing the conclusion that he is a gambling genius. He then decides to be a fulltime professional BlackJack player while all those other saps who get up and make things from 9 to 5 are idiots.

    Of course we all know how this story ends.

    They just want to “get theirs” buy being a person in the middle of a scheme.

    They are your bubble-chasers. While you and I are building and “making things”, these people are trying to figure out how they can position themselves to catch the next bubble and profit off of the patsy bagholder whom is not as astute in bubble-chasing as they are.

    So when I see these houses where the owner is asking 100K over what they paid, I immediately ask:

    “Why do you deserve a 100K profit at my expense for living in and crapping in this house for the last 2 years? Hmmm?”

    It’s going to be awhile before the masses realize the real-estate is a dumb investment and they are much better off putting their money in the bank. We have to let a few more knife catchers take the plunge and get stuck holding the bag first.

    These people are going to start looking for the casino exits in 2011-2012 as capitulation sets in. There should be some realistic deals out there by then.

        1. AZDavidPhx

          I tried to post some links, but the stupid spam filter keeps blocking my posts.

          Just google “Currier & Ives grow poor wiki”

      1. BI

        As much as I enjoy your graphic I have to disagree.

        The current business environment in the US does not reward hard work.

        Youth recognize this.

        Chasing bubbles can make you rich and working hard rarely will.

        Luck and timing (hmm… sounds like gambling ) is what will make current and future generations rich…


    1. Perspective

      This is going to sound very elitist, but, I think this mentality grew so wildly because it was the best and easiest way for the “middle class” to “get rich.” (I hate the term “middle class,” but I mean households earning between the 25th – 75th percentiles). Why go to 4+ long years of undergrad or to grad school to learn a profession and spend all that money, time, and energy? Why do that when I can read Rich Dad Poor Dad and flip houses (I’m not knocking this book, I actually liked it).

      Taking away the idea that residential real estate is a “road to riches” destroys the aspiration of many Americans. We like the quick hit to wealth, not the long slog. “Joe the Plumber” encapsulates this best with his deeply held belief that higher taxes on the “rich” will hurt him very soon.

      1. AZDavidPhx


        As the author of ‘Rich Dad Poor Dad’ will probably tell you, selling ‘How To Get Rich’ books to the masses for 14.95 a piece is one way to get rich.

        I’ll take it one step further and say that housing enrichment is not even an ‘aspiration’ of many Americans, but actually an ‘entitlement‘ to many Americans.

        The house price fantasy world that was engineered via decades of increased credit dollars and I.O.U monopoly money flooding the market and stimulating house prices has created an entitlement mentality (I have also seen it called a ‘social contract)’ among our citizenry that has lead to this commonly expressed notion that a homeowner deserves to earn a profit for doing nothing more than live in a house.

        People expect the government and the banks to hand out gobs of more and more credit to each new wave of home-buyers to keep the prices rising and the party going.

        The longer a person lives in their house, the higher the profit they deserve. Each new homebuyer owes their seller a specialy gratuity for the right to acquire their house.

        Of course now, the majority of bag-holders are still living in their fantasy world and expressing righteous indignation that they have been screwed as society has defaulted against them on the social contract that they signed on to.

        1. DeathToSinan

          With the upcoming inflation that the government is foisting on us, I don’t see how housing prices–along with everything else–won’t rise. We’ll actually have to tape pieces of paper onto our currency to make room for all the extra zeros.

          I may only be speaking for myself, but I don’t think people are allowed to work hard for money anymore–there’s too much outsourcing going on in too many sectors. What’s left?

          1. BI

            I agree 100%…
            My company ( fortune 50 ) outsources everything possible. IT development, project managers, etc…
            We really have a double wammy here..

            Why work hard when executives will pay you as little as possible and outsource your job…

            Why work hard when you can suck up any moral values you may have and write loans to hispanic families who can never in a million years repay them…

            well..we can see what obama has in store…
            I know, lets give everyone more money…a stimulus package will fix everything…


    2. Landmark

      Classic— I’m relatively new to the blog, but I now see why Arizona Dave is so popular. Very astute

    3. QualityPicks

      I often like to get a feel for the psychology of the markets by asking my friends around. Right now we are in a bizarro world 🙂 Everybody sounds negative, but they are all actually optimistic in my way of thinking. Why? Everybody keeps saying that “now is a great time to buy because everybody is so pessimistic”. I keep hearing things like “things are really bad right now, I won’t sell now because I won’t get what my property is really worth”. And there are tons of comments similar to that. The way I see it, they are reading all the negative news, and repeating what they hear, but they are actually optimistic and hopeful, and also, in a denial state that things can’t get worse.

      One of my most responsible friends, has lately been looking to buy a bigger house. They are afraid that if they don’t buy right now, they might not be able to buy again in the future. They have been very responsible so far, and I think they remorse having been so responsible, when they could have bought much bigger house back in 2000. My friend even made a comment like “If I had known how housing works here in California, I would really have stretched myself beyond reason to buy as much house as possible”. This comes from a responsible and logical person, he is an engineer.

      The truth is, very few of my friends have been affected by the housing bust. Right now it is still easier to see “how much I missed in gains”, rather than “how much I could have lost”.

      It will take time before people change their minds and give up at much lower prices.

  2. nefron

    Hey, I’m renting this same model a few streets away. While I was watching the market in this area I was surprised that this one hadn’t sold, compared to other sales in the area. It could be that it backs to a major street and isn’t particularly close to a green belt. Probably there’s more to it than that.

    1. .

      Look at the property sales history. It doesn’t look like an auspicious place to buy a home.

      Apr 11, 2003 $467,500
      May 22, 2000 $35,000
      Jul 26, 1989 $255,000
      Dec 13, 1988 $32,000

      1. dafox

        can someone shed some light on these $32k and $35k “sales”? I see them somewhat often on Redfin listings on other houses. I have a hard time someone just bought a house for that amount.

  3. nefron

    Sorry I don’t get it. What am I supposed to be reading into those numbers, besides the fact that they look strange?

  4. Texas Triffid Ranch

    With the fake ellipses, I’m reminded of a very old article from Mad magazine in the late Fifties about how advertisers use ellipses to turn a really bad review into a seeming rave, and what will happen when that starts moving into other areas of life. I think we’re seeing this happen with this listing, and just as how you replace bleeped-out words on television with much filthier words than what were actually bleeped, I can only imagine the horrible Mad Libs your faithful readers will add once they start filling in the blanks.

    Let’s start. “Charming 3 bedroom home with a nice open floorplan (that’s completely unusable by anyone other than minimalists) separate formal dining room perfect for the holidays (if you celebrate Guy Fawkes Day and Charles Manson’s birthday) nice kitchen with a breakfast bar (literally, sitting there on the counter with a glass of orange juice and a can of Slim-Fast) romantic fireplace just in time for winter and fall (in an area where you might actually use it once or twice every three years, while it sucks all of your air conditioning in summer up and into the north wind)…”

    1. jo

      Great post, but go easy on Guy Fawkes Day. What’s wrong with huge bonfires and fireworks? Certainly a better way to spend an evening than celebrating a serial killer’s birthday!

        1. IrvineRenter

          LOL! That man-eating plant does not look out of place.

          You should email me a copy of all the pictures you have done. It would make a great open thread weekend topic.

  5. nicholas sarko

    well, now that credit has dried up and people can spend only what they earn or feel comfortable spending in the absence of credit, man! did you expect stores to fall off the table like that? circuit city is gone, who else will follow?

    stunning the contrast between draining thousands in home equity to buy a big-screen tv every year and spending what the average american fool carries in his pocket — it turns out he’s hard put to afford a big mac!

    1. Bitter Renter

      Yeah, but Circuit City going bankrupt wouldn’t have surprised me even if it had happened a few years ago. Inferior to Best Buy in almost every way (and Best Buy isn’t exactly Shangri-La).

      1. DeathToSinan

        Don’t forget that not too long ago, the Circuit City CEO came up with the brilliant plan to lay off all their better-paid, experienced salespeople in order to save money. Heck, they saved so much money they had to file bankruptcy. Why not save even more and just fire all their remaining employees immediately?

  6. Matt

    IR, mind posting a few of those better deals in UP?
    I’m not buying soon, but I like UP’s location and it’s one of the places I’ll be checking out in winter 2010.

    1. IrvineRenter

      I’ll post them all as I find them. I am looking forward to 2010 when I can start doing posts showing properties at or below rental parity and touting them as good deals.

      1. Landmark

        I would like to get IrvineRenter and others opinions on real estate as a long term investment?

        Is real estate still a good investment in areas that are not inflated?

        Is real estate still a good investment an areas that appreciate at 2-3% if you can break even or cash flow with 10 or 20% down?

        Is real estate not a good investment anymore period?

        When is real estate a good investment?

          1. Landmark

            Great info in the Value of residential real estate blog– anyone that hasn’t read it definately should. You should be paid for the info you post on here— oh ya, or people could just buy your book =)

  7. Failedagent

    Along time ago I thought theat the day would come when you could no longer “park your money” and make a profit through asset appreciation. The only way to make money would be the old fashioned “value added” approach where you had to physically do something that changed the material universe.I think this housing debacle and the looming baby boomer retirement demographic is going to make that a reality starting today.

  8. Cosmo Kramer

    Now that’s curb appeal. Mighty fine looking garage.

    The living room reminds me of the SNL skit with the futuristic German(?) couple who are completely nuts and always have insanely uncomfortable furniture. “Nuni?” “No! Neww nee” :-S

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