A Little Bit

Do you have a little bit of time to review another losing Irvine property?

108 SPANISH LACE Irvine, CA 92620 kitchen

Irvine Home Address … 108 SPANISH LACE Irvine, CA 92620
Resale Home Price …… $875,000


I’ll give a little bit
I’ll give a little bit of my life for you
So give a little bit
Oh give a little bit of your time to me

Give a Little Bit — Supertramp

Have you ever pondered the interesting relationship we have? I give up a little bit of my time each day to observe the real estate market and ramble on about it, and you give up a little bit of your time each day to read it.

When I started writing, I did not think about readership. I wanted my voice to be heard, but like any concerned citizen shouting when there is an emergency, it wasn’t the voice, it was the message. As you tuned in each day to read, we have formed this relationship.

Writing and having a readership creates a responsibility. I like images and ideas for posts that are edgy, and sometimes I do cross the line for some people, but that comes with the territory if posts are going to be interesting (and fun for me to write). I have to carefully measure and manage this edge, and if I suddenly and without warning cross the line — start posting inflammatory speech and images — I would deservedly lose readers.

Writing is an enjoyable responsibility. Gaining readership is addicting. I had lunch with a fellow blogger a couple of months ago, and he was very excited about having readers. He printed out charts and talked about the various ways to measure readership (it isn’t very easy), and he was elated about traffic spikes when he was linked by a larger blog. It was easy for me to relate. He knows the heartfelt the joy of his voice being heard. I was excited for him because I know that joy in my own life. Thank you for reading each day.

I have been examining this relationship in my own terms. Have I become attached to having readers? Am I now a slave to a new master? These are issues I will wrestle with on my own. As long as I have a little bit to give, I will.

Back to our regularly scheduled losing property in Irvine….

108 SPANISH LACE Irvine, CA 92620 kitchen

Irvine Home Address … 108 SPANISH LACE Irvine, CA 92620

Resale Home Price … $875,000

Income Requirement ……. $164,733
Downpayment Needed … $175,000

Home Purchase Price … $958,500
Home Purchase Date …. 4/12/2006

Net Gain (Loss) ………. $(136,000)
Percent Change ………. -8.7%
Annual Appreciation … -2.4%

Mortgage Interest Rate ………. 5.20%
Monthly Mortgage Payment … $3,844
Monthly Cash Outlays ………… $5,270
Monthly Cost of Ownership … $4,060

Property Details for 108 SPANISH LACE Irvine, CA 92620

Beds 4Gourmet Kitchen Award
Baths 3 full 1 part baths
Size 2,300 sq ft
($380 / sq ft)
Lot Size n/a
Year Built 2005
Days on Market 4
Listing Updated 11/4/2009
MLS Number S594878
Property Type Condominium, Residential
Community Woodbury
Tract Wdst

Fantastic Model 3 on Spanish Lace right across the street from the park. Large Gourmet Kitchen with Stainless Steel Appliances, Upgraded Cabinets, Center Island and Double Oven. Caesar Stone tiles in all bathrooms. Crown Molding and Can lights along with a built-in Surround Sound speaker system throughout the house. Custom Media Niche in living room. Enclosed patio area great for entertaining comes with a fountain and built-in Lynx BBQ. Master suite is very large and includes built-in dressers. Woodbury amenities include pool, tennis courts, sport courts and many parks.

When I was filling in the cost details for this property, I noted about $4,400 in special levies, taxes and fees.

BA MOSQ,FIRE ANT ASSMT (800)273-5167 $3.04
B3 VECTOR CONTROL CHG (800)273-5167 $0.67
C7 MWD WATER STDBY CHG (866)807-6864 $10.08
E0 IRVINE USD-ASMT (949)250-8300 $54.19
MY 1915 AD BOND MY (866)807-6864 $2,214.86
N1 LNDSCP & LTG #1 (866)807-6864 $89.98
R2 MELLO-ROOS R2 (800)858-8233 $622.45
R6 MELLO-ROOS R6 (800)858-8233 $1,410.12

The combined HOA expense is $230 per month as well. Despite these high costs, low interest rates have pushed affordability up to 5.3 times income. The historic norm at the bottom is 4.0 for several years.

This property was purchased for $958,500 on 4/12/2006. The owners used a $766,443 first mortgage and a $192,057 downpayment. If they get their asking price, they will recover a little bit over $50,000 of their downpayment.

The owners are pleading with the market for their downpayment money, “So give a little bit… Oh give a little bit…

Irvine Housing Blog No Kool Aid

I hope you have enjoyed this week, and thank you for reading the Irvine Housing Blog: astutely observing
the Irvine home market and combating California Kool-Aid since
September 2006.

Have a great weekend,

Irvine Renter

39 thoughts on “A Little Bit

    1. IrvineRenter

      I look at all those sources, but with RSS feeds, it is very difficult to get an accurate measure of readership. We get about 8,000 page views a day, but many of those are the same person refreshing the browser or revisiting the site. The site also gets about 3,000 unique visitors each day, but that doesn’t tell the story either because we have nearly 3,000 people signed up for the RSS feed. Unfortunately, I can’t just add the two together and assume there are 6,000 readers because many either do not consult their RSS feed and don’t visit, and many with the RSS feed come visit the site anyway, so there is plenty of double counting.

      1. norcal

        If you use the GoStats counter (a free download) you can view readers by server, by number of posts read in each session, by country, etc. But the most important function I like is the “REAL PEOPLE” one, that eliminates all those page refreshers and gives you the number of actual readers per day/week/month.

  1. AZDavidPhx


    U.S. Foreclosure Filings Surpass 300,000 for 8th Straight Month

    By Dan Levy

    Nov. 12 (Bloomberg) — U.S. foreclosure filings surpassed 300,000 for an eighth straight month as unemployment made it tougher for homeowners to pay their bills, RealtyTrac Inc. said.

    A total of 332,292 properties received a default or auction notice or were seized by banks in October, up 19 percent from a year earlier, Irvine, California-based RealtyTrac said today. One in every 385 households received a filing. The tally fell 3 percent from September, the third consecutive monthly decline.

    The foreclosure problem is still with us and will keep prices down,” Stephen Miller, chairman of the economics department at the University of Nevada at Las Vegas, said in an interview. “The real issue is we don’t know what inventory banks are holding that they have yet to put on the market.”

    Distressed real estate transactions accounted for 30 percent of all home sales in the third quarter as the median price fell 11 percent from a year earlier to $177,900, according to the National Association of Realtors. U.S. unemployment surged to a 26-year high of 10.2 percent in October as payrolls fell by 190,000 workers, the Labor Department said last week.


    Coming on Market

    About 7 million properties likely to be seized by lenders haven’t yet hit the market, Amherst Securities Group Managing Director Laurie Goodman wrote in a Sept. 23 report.

    Housing indicators that show price increases in some areas of the U.S. are being distorted by government efforts to reduce foreclosures, which are temporarily limiting sales of seized homes, said Scott Simon, managing director at Pacific Investment Management Co. in Newport Beach, California.


    California, Florida

    California ranked second, with filings for one in every 156 households.

    California led in total filings, with 85,420, up 50 percent from a year earlier. Default notices in the most populous state more than doubled and auction notices rose 73 percent, according to RealtyTrac.

    California had seven cities among the top 10. Vallejo- Fairfield ranked second and Modesto was third, both with a rate of one in 81 households. Riverside-San Bernardino was fourth and Bakersfield, Merced and Stockton ranked sixth through eighth, respectively. Sacramento came in 10th.

    1. IrvineRenter

      I hope someone does an update to the ARM reset schedule again. Many of these ARM resets and recasts have already probably defaulted and are part of shadow inventory. The sooner these loan holders default, the sooner we can clear out the overhang of supply and get back to a normal market.

      1. AZDavidPhx

        I think that the surge in “Strategic Defaults” over the past year is a pretty big clue.

        The loan mods are going to drag it out, I think.

        I know a Strategic Defaulter in real life who is currently sitting in their “Interest Only” million dollar house (would fetch 550K in current market) trying to strongarm a loan mod. Of course the odds of a foreclosure outcome are somewhere in the neighborhood of 110% at this point, but I bet nothing will happen for another year at least. The foreclosure map resembles a Nuclear fallout over here.

      2. tacoshark

        Unfortunately, the market will not be normal in our lifetime. The only normal market left is grocery.

        1. Major Schadenfreude

          I would say the only “normal” market left in this country are the private sector jobs in industries not well represented by lobbyists in DC.

          And with regards to housing, the question is not how long before it gets back to “normal”, but how long before it gets back to being “less tainted” by government intervention shenanigans, so that it may be somewhat affordable, as in 20% down payment with 25% DTI.

          Five years? Ten years? Regardless, our lenders & leaders made housing unaffordable for practically an entire generation. That is quite an accomplishment.

    2. newbie2008

      Thanks for the new default rate. The 7% over 90 day late makes sense now. With doubling to 1/156 or 0.64% new ones multiplied by 12 month for FC will be 7.6% if rate was constant, but with new 90 day late increasing, that could only mean FC are taking much longer than 12 month. Looks like the true time to trustee sale or jingle mail might be more like 24 months now.
      Does loan modification reset the 12 month clock to have a trustee sale? I see with loan modification using principle reduction as don’t pay for 8 month, get a principle reset with non-payment forgiveness, then pay for 3 month and quit paying for the next 12 months. Free rent for 20 months now. That plan will keep houses off the market and prices higher. With interest rates to banks at 0.25%, they can do it for some time, but the banks are greedy and don’t want to risk their own money, so they use GSE’s to front the money and pay for the banks 1% fee.

      Ron Paul wants to have congress investigate the Federal Reserve Bank to see actually controls or owns it. That would involve removing the Fed’s exemption from the FOI from a so-call govt agency/corporation.
      Any choice quotes from Andrew Jackson on a federal banking system or their supporters?

    3. Lee in Irvine

      Housing indicators that show price increases in some areas of the U.S. are being distorted by government efforts to reduce foreclosures

      When I read stuff like that, I just want to go berserk.

      1. AZDavidPhx


        How long has N.A.R been calling bottom now? Going on two years almost, right? Month after month a new prediction of the how we are nearing the bottom.

        And what is this “grow” language that they are using – like house prices are some metric for gauging economic productivity; a bunch of house debtors swapping their houses among each other. Yea, real growth there. If only salaries were predicted to grow as well. Fat chance of that happening (at least for first time buyers).

    4. tonye

      Ay! As usual, there are statistics and then there are lies.

      The big red line, the “cumulative” line is a red herring. All it says it that by 2012 ALL will such mortgages will have recast.

      So what?

      The one graph that is important is the one in a ‘softer” background yellow: the bar graph that shows an asymetric bell curve.

      The important date there is summer of 2011m, NOT 2012.

      Additionally, the bell curve needs to be adjusted for the mortgages that have gone belly up by now.

      I guess I can’t expect everyone to have studied math in college as I did, but at least you’d expect people to have some understanding of basic statistics…. jeez…

      1. AZDavidPhx

        All it says it that by 2012 ALL will such mortgages will have recast.


        Thanks for brilliant observation, Tonye. The phrase “No shit, Sherlock” comes to mind.

        The important date there is summer of 2011m, NOT 2012.

        Negative, Captain. The stupid people like me expect the process to drag into 2012. The recasts are not going to result in instant foreclosures that hit the market. This is going to stretch beyond 2012 – all this graph says is that we can expect the banks to continue taking losses on these loans into 2012 and beyond.

        Additionally, the bell curve needs to be adjusted for the mortgages that have gone belly up by now.

        Not if you want to be conservative and think of this as a worst case scenario, which is how I think of it.

        guess I can’t expect everyone to have studied math in college as I did, but at least you’d expect people to have some understanding of basic statistics

        LOL! Oh my apologies, Mr. Hawking – I failed to realize that I was in the presence of such legendary brilliance. You are like the guy who reads a book and then walks around telling everybody he runs into “I READ A BOOK LOOK – AT ME WANK MYSELF EVERYBODY”.

        I predict Irvine is going to have a wave of foreclosures by 2012 as a result of the IMPORTANT date that you mention in 2011 – I am just giving some lag time between recast and foreclosure auction.

        You are not as smart as you think you are.

      2. Scott

        Wow, you completely whiffed. Did you actually attempt to read David’s post? Not only are your “math” credentials suspect, but it looks like you’d better get a move on improving your reading comprehension skills, as well.

  2. jumpcut

    I’m not a huge fan of your navel-gazing posts, and there seem to be a lot of them lately. The again, it’s your blog, you can do what you want.

      1. Gemina13

        I enjoy your introspective posts as much as I did your “WTF?!” posts two years ago. And may I say, you’ve developed a knack for a nice turn of phrase.

  3. cara

    I sorta wish I had access to the loan information on the houses I’m looking at in the DC area, but at the same time I’m glad I don’t. There’s a number we’re going to look at this weekend where the owner bought it for 30-100k over the list price (we’re talking high 300s low 400s here). If I knew what their mortgage situation was I might make incorrect assumptions about their ability/willingness to accept any given offer.

    That would be just as wrong as if they had access to the knowledge of how much money a bank is willing to loan us. Neither their loan, nor our maximum pre-approval amount have any direct bearing on how much the house is worth, and hence it shouldn’t have any influence on our offer, and “shouldn’t” have any influence on their reply, unless our offer is too low for their ability to accept it.

  4. AZDavidPhx

    Irvine Lee –

    A followup to our discussion of Corporate NEWS yesterday.

    Patrick.net reader posted a great example of CNN masquerading REIC advertising as “NEWS”.


    These are the same groups who select the political candidates that the majority of voters have access too.

    Can you imagine a modern day Andrew Jackson coming along with an agenda to declare war against the REIC? Do you think CNN’s sponsors would have something to say about such a candidate receiving significant airplay on their advertising dollar? I do.

    1. Lee in Irvine

      Can you imagine a modern day Andrew Jackson coming along with an agenda to declare war against the REIC?

      Not in today’s age.

      Didn’t Jesus call them “money changers”?

      Do you think CNN’s sponsors would have something to say about such a candidate receiving significant airplay on their advertising dollar?

      They killed Jesus for it.

      Let me just say this. I think the most informed TV media personality, and best advocate for the average Joe is without a doubt, Dylan Ratigan. He’s been on top of this banking ponzi scheme, and bullshit insurance scam for a couple of years now. I don’t think he plays favorites with politicians. But that’s JMO.

    2. Geotpf

      The WTF section is easy to explain.

      This part of CNN is like a blog. They post a new story every few days. One day, there was no decision. Four days later, they pointed out the credit was scheduled to expire soon. Five days after that, the credit was extended. The only problem was that they didn’t remove the obsolete stories from the list.

      1. AZDavidPhx

        You’re damn right it is like a blog; a blog for housing bulls, such as yourself, masquerading as an independent NEWS source.

        Thanks for pointing out the obvious there, Geotpf.

        Have another glass of your favorite REIC Kool-Aid.

  5. Woodbury Renter

    Even among all of the radically overpriced homes in Woodbury over the last several years I find this homes to be the most egregious. Tiny bedrooms uptstairs, tiny side yards (if you want to use the built-in bbq you will be by yourself). The first level is OK but not that inspired. How do they think someone will pay more for this house when the new homes being built are priced for less?

  6. newbie2008

    So much for the great recovery. Pump and Dump before the fall.

    Home-Purchase Index Plunges
    By Barry Ritholtz – November 13th, 2009, 5:57AM So much for the Housing Rebound:

    “Mortgage applications to purchase homes in the U.S. plunged last week to the lowest level in almost nine years as Americans waited for the outcome of deliberations to extend a government tax credit.

    The Mortgage Bankers Association’s index of applications to buy a house dropped 12 percent in the week ended Nov. 6 to 220.9, the lowest level since Dec. 2000. The group’s refinancing gauge rose 11 percent as interest rates decreased, pushing the overall index up 3.2 percent.

    The drop in buying plans points to the risk that the recent stabilization in housing will unravel without government help. In a bid to sustain the recovery, Congress passed and the administration signed a bill last week to extend jobless benefits and incentives for first-time homebuyers, adding a provision that also made funds available to current owners.”

    If stabilization comes only through government subsidies and artificially propped up home prices, is it truly stabilization?

      1. Chris

        Well, we should call it “deflation prevention” 🙂

        #2, well DUH, of course mortgage app is gonna drop. Geez, honey, I lost my job this week (part of the 1/2 million counts per month from BLS). Let’s go buy a house.

    1. awgee

      It is stabilization of the housing market, short term, and destabilization of the deficit and US dollar long term.

  7. whatever

    I dunno. My relator was sighing that another customer wanted to put a bid in on a foreclosure in Irvine. She called the rep for the REO and found there are already two cash offers and a 50% down offer on the place.

    Mortgage lending rates do tell a story, but what about cash buyers? What about investors? There are transactions that don’t go through mortgages. And as the mortgage lending rate falls, would these go up if the people with this money think the real estate is a good deal? I mean in areas where these investors are concentrating – like SoCal.

    So sitting on the sidelines might be a good idea in some areas (Modesto, Vegas), others that are attractive to investors, hard to say.

  8. interest rates do matter

    Interest rates do matter. The cash buyers usually want to flip the property and the low interest rates allow them to mark up the prices when selling to a buyer who is buying with a low interest rate loan. Obviously, cash buyers could not do that if they are “investing” in an area that has few qualified leveraged buyers.

  9. whatever

    The question is how many “non-leveraged” buyers are there for continuing to buy in Irvine, whether investors or individuals, now and in the future. What is equalibrium in the area when crazy loans are taken out?

    And what is leveraged? I am a 20% down buyer. I wanted a home. I am not “investing”. I could keep renting (also in Irvine) but I wanted to improve my quality of life. And with current rates plus housing prices, the whole “rental parity” equation equaled out.

    For me the question was “are property values plus interest rates” the lowest they are going to go? I think the answer is “probably”. I don’t think both will both go down together at this point. If you hold out now the bet is that rates will hold steadily low and property values will continue to drop – and that is a big bet with the fed printing like mad, deficit increasing, tax receipts down, and so on. Rates will have to go up, and if they do property may go down, but the cash-flow out will remain relatively constant, but more of it now is going into equity instead of higher interest rates.

    1. Freetrader

      I think that if someone likes a house, and a neighborhood, and can afford the payments, and wants to buy, as you did, then buying is rational. One could argue that prices may go lower if you wait, but as Keynes said, in the long run we are all dead. There is nothing wrong with buying if you feel like buying. We get a little too wound up araound here worrying about what the ‘other guy’ is doing to screw up the market — low interest rates puming up prices, looming shadow inventory about to push price down, but there is a lot to be said for simply making the best bet you can when you do buy. Anyone who buys a house has to be willing to realize that at some point in the future they are likely to slap their heads and say “I coulda done that…” if they had had perfect information about the future. There is never perfect information, and you could always have done better if you had a crystal ball. So, make the best bet you can at any particular point in time, and be prepared to live with that decision for awhile.

    2. momentum slowed

      I think our economy managers have been able to slow the momentum on the way down and actually stop the free fall in housing prices, and even if prices start falling again, they will fall from a higher level due to the recent bump up in prices. It may not be fair for buyers but life is not always fair. So, if someone is in need of buying, why not, just make sure you like the property since you will be in it for a long time. One more thing, what adds insult to injury, is that even someone decided to buy, they will have to compete with multiple offers here in the OC! Go figure 🙂

  10. las vegas ivnestment property


    I am developing a blog focusing on the benefits of investing in property in the Las Vegas area. A Google alert turned up your site, and I was curious if you were interested in a link exchange. My site has general investment tips and strategies, popular areas around the city to invest, as well as fees and contact info for local property management companies.

    Thanks in advance for your consideration, and feel free to visit my site at http://lasvegasinvestmentpropertyguide.com.


    1. Chris

      “focusing on the benefits of investing in property in the Las Vegas area”

      Unlike Vegas, Irvine is catered more toward families that want to live in a community where their children can get the best *public* education California has to offer (and that says a lot on the current state of California’s *public* education).

      If the focus of this discussion is solely on *investment*, sadly, you won’t get much sympathy or interest from the folks who regularly post on this blog. You’re better off throwing bull manure up in the air and see where it’ll land.

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