IHB News 2-20-2010

The two photos below from today's featured property caught my eye; accidental excellence? Purposeful?

Irvine Home Address … 145 OVAL Rd 3 Irvine, CA 92604

Resale Home Price …… $355,000


And you ask me what I want this year

And I try to make this kind and clear

Just a chance that maybe we'll find better days

Cuz I don't need boxes wrapped in strings

And desire and love and empty things

Just a chance that maybe we'll find better days

Goo Goo Dolls — Better Days

IHB News

I concentrated my careless writing errors this week — not an accomplishment I am proud of.

In my stack of books that arrived this week, I received The New York Times Guide to Essential Knowledge, Second Edition: A Desk Reference for the Curious Mind. After skimming through the contents, it is a book I will return to for a more careful reading — which may take forever given its size. I was drawn to this book because as a writer knowledge is the forerunner of creativity, and I need to expand and round out my understanding of the world to find apt analogies and eliminate general ignorance.

As geeky as this sounds, I am very excited over the impending arrival of Shorter Oxford English Dictionary: Sixth Edition, and Oxford American Writer's Thesaurus. I already have several dictionaries and thesauri, but I quickly find them lacking, so I keep going for bigger, better and more detailed books. I have also ordered The Chicago Manual of Style to clean up some of my ignorant mistakes. For instance, should the titles in the links peppering this section be bold, italic, or some combination thereof?

In my car, I am listening to Classic Novels: Meeting the Challenge of Great Literature & The History of World Literature as a series of recorded college lectures. I just finished Building Great Sentences: Exploring the Writer’s Craft & Great Authors of the Western Literary Tradition the results of which you may have noticed. I have several products from The Teaching Company, and I encourage anyone interested in life-long learning to check them out.

Housing Bubble News from Patrick.net

Featured Photos

The two girls liven up this shot ad make this complex look fun and exciting. Do you feel the gleeful gallop in the young girls step? It looks playful and nice. Do you want your children to grow up there?

It is difficult to take an interesting photo in an empty room, but this one is. A large space with only one light source low to the ground is going to be dark, and the bright starburst on the floor distracts your eye from how dark the room is and makes an effective photo.

145 OVAL Rd 3 Irvine, CA 92604 145 OVAL Rd 3 Irvine, CA 92604

Irvine Home Address … 145 OVAL Rd 3 Irvine, CA 92604

Resale Home Price … $355,000

Income Requirement ……. $74,598

Down Payment Needed … $12,425

3.5% Down FHA Financing

Home Purchase Price … $220,000

Home Purchase Date …. 4/18/2002

Net Gain (Loss) ………. $113,700

Percent Change ………. 61.4%

Annual Appreciation … 6.2%

Mortgage Interest Rate ………. 5.13%

Monthly Mortgage Payment … $1,866

Monthly Cash Outlays …..….… $2,440

Monthly Cost of Ownership … $1,790

Property Details for 145 OVAL Rd 3 Irvine, CA 92604

Beds 2

Baths 2 baths

Home Size 1,077 sq ft

($330 / sq ft)

Lot Size n/a

Year Built 1972

Days on Market 3

Listing Updated 2/17/2010

MLS Number S605734

Property Type Condominium, Residential

Community El Camino Real

Tract Ws

The property is located in the center of Irvine. Close to 99 supermarket, Irvine Valley College, Irvine school district, library, shopping center and easy access to Freeway 5. 2 bedroom and 2 full bathroom. Downstairs has an extra room. It is a few has an attached car garage in that community. A lot of parking spaces. The lovely home has a very private backyard with access to the outside. Very low property tax rate and no Mello Roos. Low HOA included water, exterior fire insurance and trash. It is a standard sale.

Redfin listing for 145 OVAL Rd 3 Irvine, CA 92604

$300,000 mortgage on a $220,000 property. How did that happen?

22 thoughts on “IHB News 2-20-2010

    1. AZDavidPhx

      IRS tax liens on the carpet business and other properties caused the bank to go after his house even though he was not delinquent on the mortgage; it was listed as “cross collateral”.

      Looks like time ran out for this chump’s housing piggy bank.

      The IRS will be sure to bow down and kiss the ring. They will not make the rest of his life a living hell or anything like that.

      Keep this guy away from firearms and airplanes.

      1. Singh


        Have you updated your Irvine Median Home Prices.. Actual Vs Predicted graph? I was wondering how it looks like now.

        1. IrvineRenter

          I need to get the updated monthly numbers from either dataquick or CAR. I may have to pay for it, but it would be an interesting update.

          I have to imagine the actuals are above my predicted $472,000 on January 1, 2010, thanks to 5% interest rates courtesy of the Federal Reserve.

    2. es

      It looks as if he improved the land with the structure; and I’m not sure of the specifics but it may be that it was within his right to tear it down as well. However, he may have to bear the cost of removing the debris.

  1. Sue in Irvine

    I’ve been listening to The Killers Live at Royal Albert Hall in my car. Then at home I can watch the DVD. Fun times.

    Too bad these little girls don’t have a real yard behind their house to play. We did when we were young.

  2. freedomCM

    nice 40 year old apartment, and “freeway close!”, and “cozy”, oh boy!

    wait: $350,000 plus $240HOA plus $300tax per month?

    Maybe I’ll just pay $1500/month rent instead.

    1. wheresthebeef

      But didn’t you read the part that it’s close to the 99 supermarket…or is that the 99 cent store. Either way, you can buy cheap food and cheap malt liqour when you are stuck there for the next decade.

      No thanks, I’ll keep renting also. Condos and townhouses are advertised as the first rung of the housing ladder (probably a place you wouldn’t want to be stuck in for an extended period). When it is almost guaranteed that you will have no appreciation for a long, long time…buying something like this makes no sense at all. If you must buy now, a SFR where you could stay indefinitely would make sense.

  3. newbie2008

    Apparently you can do math. Most Americans think they are the greatest in math but can’t do math. Must be low self esteem. Better give a math accomplishment award.

    The asking price is $330 per square foot without owning the land.

    ~Get Real !
    ~ = approximately
    ~ = bullet point symbol

    Best economy in 50 years = Internet bubble, buy so I can cash out.
    Economic is recovering = Buy my stocks so I can cash out.
    Housing has recovered = Buy so I can unload a bad loan.

    1. IrvineRenter

      I didn’t allow for approximately because it isn’t a double-stacked tilde, but you’re right, that meaning would easily read in context.

  4. orthogonal

    I’ve posted this on another forum, and I was directed to this site for more advice. This is what I posted on the other forum:

    After many years of diligently scrimping and saving I’m now finally in a position to buy my first home. I’ve found a property I really like. The problem is, the home is an REO and it needs a lot of work. The house is missing all its fixtures and appliances, so it is currently not habitable. This means I am unable to secure a standard FNM mortgage on the purchase.

    I have enough funds to pay cash for the house, but not enough to also complete repairs.The cost of repairs are about another 1/3 of the purchase price of the house.

    After some research it seems my options are:

    1) Pay cash for the house as-is, then use a hard money loan for the cost of repairs. This is very expensive, at interest rates of around 10%. Too expensive to contemplate really. In theory I could refinance after the repairs are done to pay off the hard money loan, but that will still leave me with massive upfront costs to deal with.

    2) Secure a 203(k) FHA rehab loan on the ARV. It seems very few lenders offer this so they’re very hard to find. Even then the interest rate is probably 1% above a FNM 30yr fixed, plus considerable upfront points and fees, so again it is more expensive.

    3) Pay cash for the house as-is, then use a HELOC to pay for the repairs. This option seems to be very cost effective, cheaper even than a standard 30yr fixed (I’ve been quoted ~4%) and minimal up front costs. Really, it seems too good to be true; it’ll be cheaper, more flexible and far less hassle than a traditional mortgage, and I have the option to refinance into a 30yr fixed whenever at minimal cost.

    Will option 3) really work? My biggest fear is that I’ll buy the property for cash, using up all my savings but then have no access to funds to complete the repairs. This will blow my life’s savings with nothing to show for it in the end. How can I be secure that this will work out?

    1. IrvineRenter

      My first observation is that you may benefit from shopping in the Trustee Sale market where prices are 20% below retail.

      If you are locked in to this particular property, the three options you mentioned are all viable, and it will depend on the lenders. Getting cash out is very difficult right now for obvious reasons.

      There may be some alternate arrangements you may benefit from. You could go to a hard-money lender, have the hard-money lender buy the property with a combination of your money and theirs and have the lender take title subject to an option to sell the property back to you. Once the lender has the property, and you have renovated it habitable with your savings to qualify for financing, you execute your option and buy the property with your permanent loan money. In the end, you will have low-cost permanent financing in place, and you will have freed up the money you need for the renovation.

      That is probably how I would approach it.

      If you are unfamiliar with option contracts, the above may be rather confusing. Email me, and I can explain further.

    2. matt138

      If you are all cash, you should wait until interest rates are significantly higher to buy real estate. This will depress prices and allow you to get more bang for your buck.

      Staying in cash, I would be worried about US government default and the resulting loss of purchasing power from a decline in the value of the dollar. Your cash will get creamed if its in a savings/moneymarket/CD account.

    3. Hank

      I have recently purchased a forclosure in similar shape, although not quite as bad as what you describe. The first thing you want to ask yourself is: do you really want to do this? It will be difficult (massive, MASSSIVE understatement). If you have answered the first question in the affirmative, you need to look at your situation. Are you single or do you have a wife? Do you have kids? If you are single you will have an easier time. Not everything needs to be repaired all at once if it is just you. You can take the most important items first and fix them and move to the other items later. If you do this, you can do it on a cash basis. If you have a wife and/or family this can be more difficult. Sit down and take a hard look at your situation and then make your decision from there. If you are married and your wife is not enthusiastic about this, DO NOT under any circumstances attempt this! You will bring yourself nothing but grief…

      Bare in mind, too, that fixtures can be purchased used. Not everything needs to be new and shiney with big pricetags from expensive retail stores. Check your local mission shops, Goodwills, etc. for used fixtures. I get a lot of my fixtures, appliances, etc. from the local mission shop. Check also with local contractors to see if they have salvage merchandise available. These items can be replaced at a later date on a cash basis as it becomes available, or, you might end up like me and find exactly what you wanted and pay just pennies on the dollar for it (God is good!).

      Another thing you need to look at is how much you are willing to do yourself. Can you paint? Install electrical fixtures? Patch sheetrock? Lay tile? Fix Plumbing/toilets? Rework landscaping? If you cannot do this, all the associated costs will nickle and dime you to death. If you can’t do any of the work, in my opinion you would be much better off buying a home in better condition.

      Just my two cents. Whatever you decide, I hope it all works out for you! God bless!

  5. Chris

    Hey IR, don’t sweat it on your writing. My writing is terrible and yet I’m still providing my *astute observation* on this blog.

    You have already published a book which is more than what most have accomplished in terms of literary writing.

  6. Chris

    “Close to 99 supermarket,…”

    What, are they targeting Asians for this condo?

    BTW, it’s 99 Ranch Market.

  7. tlc8386

    just checking in on some prices and I am amazed at how long and far some will chase the market–this house in Laguna

    Property History for 1303 TEMPLE HILLS Dr
    Date Event Price Appreciation Source
    Nov 02, 2009 Price Changed $1,395,000 — SoCalMLS #L26542
    Sep 09, 2009 Price Changed $1,495,000 — SoCalMLS #L26542
    May 05, 2009 Price Changed $1,595,000 — SoCalMLS #L26542
    Jan 21, 2009 Price Changed $1,695,000 — SoCalMLS #L26542
    Oct 06, 2008 Price Changed $1,750,000 — SoCalMLS #L26542
    Aug 07, 2008 Price Changed $1,849,500 — SoCalMLS #L26542
    Aug 06, 2008 Price Changed $1,849,000 — SoCalMLS #L26542
    Jun 30, 2008 Price Changed $1,999,500 — SoCalMLS #L26542
    Jun 04, 2008 Listed $2,100,000 — SoCalMLS #L26542
    Jul 15, 1994 Sold (Public Records) $458,000 — Public Records

  8. matt138

    I’m calling BS on the credit bubble topic where Irvine Renter says low interest rates are mistakenly blamed as a primary cause.

    Low interest rates were THEE primary cause. It is the big domino that gets the rest going.

    You can’t go to In n Out, order animal style fries extra everything, and tell them to hold the potatoes.

    Money sought higher returns that savings couldn’t provide. Rising prices, lowered standards, misrepresentation, fraud, etc was just the cheese, grilled onions, and thousand island.

    Man I’m hungry.

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