The IHB News section of the weekend open thread is a place I consider an open forum for anything I want to say. If you want to read about real estate, skip this section today and go down to the Patrick.net links.
My copy of Garner's Modern American Usage arrived, and I set about finding my usage errors. I am begrudgingly dropping downpayment as a single word. I think it is a great compound, but I am not with the mainstream on this one, so I am breaking it up. I admit to three years of persistent and foolish misuse of downpayment for down payment. However, I will still use cashflow. Garner doesn't mention it, I like it, so I will keep using cashflow.
I am also going to start providing links to definitions for any uncommon word or uncommon use of a common word I looked up to write a post. Actually, this is one of the greatest strengths of the Internet and the blogging media; bloggers can make very obscure references and provide immediate lookup assistance with a hyperlink. It is also a good way to see if I am using too many of them….
After completing The Unceremonious Fall from Entitlement, I was spent, and I still have not fully emotionally recovered. I must admit, I cannot sustain that level of writing and prolificacy. It isn't that I am unwilling to put in the time and energy, I am, and I do, but when I tune in to complex emotional issues, sort through the meanings and present it coherently, it takes time and often more energy than I can muster.
I want to thank SK who left this gem in the astute observations:
I was also especially struck by your definition of wealthy people and their preferences, think you got it absolutely right.
Heres a very nice definition of being free, in case you like it as much as I did (unfortunately its not original)
The most precious sort of freedom you will not hear talked about in the great outside world of winning and achieving and displaying. The really important form of freedom involves attention, and awareness, and discipline, and effort, and being able truly to care about other people and to sacrifice for them, over and over, in myriad petty unsexy ways, every day. That is real freedom.
When I read that definition of freedom, I wept; I felt the meaning beneath the words because recently, I have been feeling more freedom and abundance in my life.
Today's featured song is one of my son's favorites, and like many of Coldplay's songs, it just makes you feel good.
Retreat to the comfort of Beautiful Portola Springs. Situated on Cul-de-Sac, this 2007 Standard Pacific built home has it all! Gracious Interior upgrades include Crown Molding, Baseboards, Oil-Rubbed Hardward and Granite Counters. Hardwood Flooring is Complemented by Stone and Granite in bath areas.Gourmet Kitchen has Professional Stainless Steel Appliances, Oversized Island that seats 4 opens to Great room with French door,Fireplace and Custom Built-in Entertainment Center. Private Office/Den. This plan offers separate living quarters featuring First Floor Master Suite with Double French doors extend your private living area to serene lush landscaped yard or relax in private interior courtyard. Oversized Master Bath with Dual Vanity, Natural Stone Shower, His and Her built in Dressers and Huge Walk in Closet. Upstairs Quarters bedroom 2 has private bath, juliette balcony,Bdrm 3&4 have Jack n Jill bath,retreat. Upstairs Laundry.Professional landscape includes Fireplace and Fountain.
Can anyone identify a pattern to the capitalization above?
BTW, does anyone think this owner has a prayer of selling for a profit?
Apparently, the Canadian version of the National Association of Realtors is not as powerful as our domestic lobby. The Canadian Federal Competition Bureau blasts Canadian Real Estate Association's Multiple Listing Service.
Flippers are buying properties for significant discounts from resale comps and selling them quickly for a profit. Today's featured property was purchased less than a month ago, and the flipper stands to make over $100,000.
Flipping properties at auction isn't terribly complicated; determine resale comps, buy for much less at auction, and sell in the resale market. As lenders crank up the foreclosure factory, Trustee Sales become more common, and thereby, so do Trustee Sale flips. The good news is that these properties are making it to the market, the bad news is that there still are not enough of them to change pricing — at least not yet. Lenders and homeowners hope it stays that way.
Canadian bureaucrats take on the Canadian Real Estate Association
As we cope with our market issues, Canadian bureaucrats are squeezing excess from realtor commissions. If you remember the series I did no selling a home, the second post was on cash listing services.
The Canadian Real Estate association banned them by changing their rules of access to the MLS. It was a brazen anti-competitive move, and Government bureaucrats are fighting back.
The federal Competition Bureau has launched an aggressive attack on the Canadian Real Estate Association, challenging its rules governing the Multiple Listing Service and calling for a radical change in how homes are sold in Canada.
“Our concern is that [CREA] are improperly and unlawfully leveraging [their control over MLS] in order to impose these restrictions and to deny competitive forces and to deny good old-fashioned market competition,” said Competition Commissioner Melanie Aitken. “This case is focused pure and simple: Let consumers have the choice, let agents have the opportunity to satisfy and serve those choices.”
I can't believe the CREA had the nerve to try this, and I hope the Canadian Government does something about it.
The MLS has been around for more than 50 years and only registered agents are allowed to list homes on the service. The MLS trademark is owned by CREA, which has nearly 100,000 members, and each real-estate board operates the service in their region. Roughly 90 per cent of all residential real-estate transactions in Canada involve MLS data.
The bureau has asked the federal Competition Tribunal to strike down a series of rules CREA adopted in 2007 that tightened the MLS listing requirements.
Ms. Aitken said the rules stifled competition because they restricted the type of services real-estate agents offered, which resulted in higher fees for consumers. Agents who wanted to offer a wider range of services, such as flat fees instead of traditional commissions charged by full-service agents, have been excluded from the MLS by CREA, she added. “What that means is consumers don't have any choice, it's either all [services] or nothing,” she said.
The charges levied by the Canadian Government are clear, and despite the legal maneuvering through shifting requirements, the transparent and anti-competitive nature of the changes are obvious and intentional.
…“This is big news for us,” said Steve Neil, a Vancouver agent who runs HomeBuyAndSell.com and has pushed for changes. “There is no question it will change things in the next several years.”
Discount brokers, who mostly operate online, have long argued that CREA's rule changes were designed to put them out of business and protect full-service agents who rely on commissions, which average about 5 per cent in total on a residential sale.
Is the CREA clinging to a number already 1% below ours?
Before the 2007 changes, some discount brokers offered to list homes on MLS for a fee, typically less than $700. The homeowner then handled the sale.
The CREA changes required all agents to inspect homes before listing them on the MLS and work with other agents throughout the sale. As a result, discount brokers say they could no longer offer their low-fee services and had to charge more to carry out the various CREA requirements.
Mr. Neil, for example, charges customers $299 to list their home on MLS, plus $79 for each week the house is listed. When the house is sold, he charges a fee of 0.25 per cent of the sale price. Mr. Neil said if the bureau wins its case, he would likely lower his fees and change his services.
“We would offer probably a sort of à la carte -type menu of services; if [customers] want them they can pay for them,” he said. He also believes several American online services would expand into Canada.
The trend is toward online listing, and ultimately realtors will lose control of the MLS. As this occurs, you will see significant pressures on commissions on the listing side of the transaction. It may take longer here in the US, but realtors will endure some of the industry purging experienced by travel agents… you do remember travel agents, don't you?
Beautiful Newly Remodeled Home in one of the most sought after areas of Irvine. Open & Spacious Floor Plan. Very quiet neighborhood with a serene view of the greenbelt. Living Room with Cathedral Ceiling & Fireplace. Brand New Gourmet Kitchen with Granite Counter Tops and Stainless Steel appliances including a refrigerator, dishwasher & range. Expansive Formal Dining Room. Master Suite with it's own private Bathroom. All Bathrooms have been fully remodeled. Spacious Ladscaped backyard that is great for entertaining. Lowest Association fee and no Mello Roos. Assocaition Tennis Courts, Pools, Racketball Courts and Spa. Excellent Schools and Superb Location. Move-In Turnkey Condition. This One won't Last!
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 2006.
Astoria Central Park West begins liquidation sales today with a big event for the public from 6 to 9 PM. They are featuring wine tasting, cocktails, hors d'oeuvres, desserts and gift bags as well as tours of model units.
Honest and ruthless; I can do that. Lennar and its equity partner want out of this disaster, and they would take the hungry and homeless — if they qualified for a loan. For years, we have stared with wonder, "What fools will buy there?" and live in the warmth of silent defeat like those in the North Korea Towers. We are about to find out because Astoria Central Park West is opening for tours and sales.
I first profiled Astoria Central Park West on April 4, 2009. In that post, I noted, "… Astoria at Central Park West is a clear loser — (for) the ownership entity that developed this property (Lennar has only a small investment). None of these units sold at the peak, and now that we are nearing a long, flat bottom, these units are hitting the market. The early buyers will be knife catchers, but in a couple of years, some of these units will be good buys — at about $300,000 to $350,000." The properties for sale now are floors 7-10 which should carry a premium to the lower floors. I wonder how many of the 3rd floor units they sold for $519,000? I wonder how those owners feel about the new and lower prices? Perhaps I will ask again when they sell floors 11-15….
With this profile, the grand opening gets much more exposure than it received through the concerted efforts of its marketing department. No other resource reaches thousands of people specifically interested in Irvine real estate, but they do have to give up control of the message. If an extra hundred or more people attend due to this post, do you think they will thank me? I won't hold my breath.
I don't know what the actual asking prices are on these units as the liquidators sellers have been careful not to publish detailed information that might discourage people from attending. The numbers I have used above are based on their website as well as rumor and speculation, and they could be very wrong.
I heard through various industry sources that Lennar had projected an average price point of around $750,000 for these units. As I have pointed out on numerous occasions with the North Korea Towers (Marquee at Park Place), cashflow valuations support about half of 2006 price levels. The North Korea Towers are likely worse due to the extremely high HOA dues, but then again, prices there have not hit bottom yet. I don't know what the HOA dues are at Astoria Central Park West, but they will likely be quite high too.
Current bids from all-cash or heavy-cash buyers at the North Korea towers are in the $350,000 to $400,000 range. Of course, none of those transact because lenders are unwilling to take the $500,000+ write-offs necessary to exit the building. Someone yelled fire (probably me), and lenders decided to stay and burn. The asking prices for the Astoria units are starting in the low $400,000s, and I would not be surprised if Lennar seduces some of the bidders from the North Korea Towers who may be enamored with the Park Place, but are tired of waiting for short-sale approval.
If you click on the plans tab, you are shown a floor-by-floor overview of the units, but unit detail is completely absent. It is like looking at a subdivision map without the house floorplans; few care about the arrangement of units, but many would like to know how these units lay out. Putting the overview without the unit detail frustrates a potential buyer looking for information.
The features tab contains the obligatory picture of a barefoot couple lovingly enjoying their shoebox. I appreciate evocative words, but "sophisticated bathrooms?" Bathrooms don't seem like something that can be sophisticated. Sophisticated: 1 (of a person, ideas, tastes, manners, etc.) altered by education, experience, etc., so as to be worldly-wise; not naive ; 5 of, for, or reflecting educated taste, knowledgeable use, etc. Do sophisticated people in their sophisticated bathrooms have sophisticated bowel movements?–I assume it smells great, right?
If you never noticed all the bare feet in new home ads, you will now (sorry). Some marketing consultant long ago noticed that bare feet suggests the comforts and coziness of home. Doesn't the couple in the picture look like they have the life all of us want?
The sizzle on the website is real; the photo gallery shows many spectacular pictures of first-rate photography. IMO, they made a mistake by putting the inside unit pictures below the scroll line where most won't see them, but the photos themselves are marvelous.
The financing tab had an interesting surprise:
Builders often buy-down the interest rate to artificially lower the payments for early years. Personally, I think the practice is egregious differing in no way from the subprime 2/28 programs that proved so disastrous. Lennar and their partner obviously do not care about the long-term viability of ownership of buyers; any who use their advertised financing will not be living there 7 years from now. The the builder bought down the interest rate on an ARM which is taken out at the bottom of the interest rate cycle; this interest rate is going to rise, and it is going to make future payments unaffordable. I suppose these will appreciate so much over the next 7 years that it won't matter, right? Bubble thinking is not dead.
While we are on the subject of financing, I want to share a recent email I received. The subject was, "WE CAN SAVE YOUR DEAL"
I can honestly say that if an IHB client needed a 60% DTI to complete a deal that I would strongly advise them to pass rather than commit to a lifetime of debt servitude or near-certain foreclosure. As long as these lending practices persist, lenders will continue to lose money, and we will continue to have inflated, unmoving prices.
Astoria Central Park West
From 6 to 9 PM Astoria Central Park West is featuring wine tasting, cocktails, hors d'oeuvres, desserts and gift bags as well as tours of model units. I may see you there, but you won't notice me in disguise.
Many cling to lifestyles of the Great Housing Bubble unable to accept reality of living within the confines of their wage income. Today we examine the inevitable and ignominious fall from entitlement.
The Great Housing Bubble cultivated a gentility of entitlement, a sordid societal residue, a system of reliance, a conviction among people that they may possess anything they wish just because; deserving without earning; Grace.
Divine acceptance is given; whereas, worldly possessions are earned — a basic truth lost through possessory entitlement. Few construct and contribute to the greater good, and many expect easy money from lenders, Governments, housing and stock markets or free-money Ponzi Schemes. We are impaired by our lender's failure and our Government's response to the crisis our lenders created; a wound that lingers as a festering sore no bailout balm can remedy.
The emotional fall from Grace has barely begun. The amend-pretend-extend dance will continue until lenders tire of paying the piper. Shadow Inventory contains the new entitlement class; while unemployed renters sleep in shelters, unemployed homeowners squat in luxury, sustain false lives on lender largess, and exalt their status in preparation for the unceremonious fall from entitlement.
The Unceremonious Fall from Entitlement
When famous people fall, it makes news, but when plebs fall, no notice is given; no ritual is performed. The silent souls quietly abandon their perceived privilege while the raucous proles forcefully defend their binding birthright through procedural delays and faithlessly modified promises. In the end, all fall to the support of their own resources and suffer to the degree they resist reshaping their lives to reflect reality.
We witness this fall as HELOC abuse posts, short sales and Trustee Sales. Like forensic examiners, we follow clues in the property records looking for what methods were used and what motivated homeowners to borrow and spend their family homes. This work is consequential because unless we see conditions for what they are, unless we see people's defective reasoning and overriding emotional gambits for what they are, we may fall victim to the same Siren's Song.
Who will fall, and how much will they suffer?
Suffering is a spiritual concept; suffering is a negative judgment of experience exacerbated by attachment, delusion and aversion. Suffering and attachment directly relate; each soul suffers in proportion to the attachments formed to objects, people, beliefs and ideas, or anything the mind's grasping can't bear to lose or give up. Are you aware of your own suffering?
Homedebtor suffering directly relates to their over-indebtedness and HELOC dependency; each suffers in direct proportion to (1) their debt-to-income ratio, (2) the magnitude to which they consistently outspend their wage income, (3) and the extent to which they must have that which they must lose. Rapid appreciation and HELOC spending to supplement lifestyle is not coming back, and all who hold their breath will give up, pass out or walk away. In the interim, they suffer. Quietly and anonymously they hatch fantasies of golden geese and high-flying home prices not to be.
Profiles in Entitlement
Prosaic descriptions of entitlement provides a skeletal structure, but to put meat on the bones we must examine the stories of individuals and families caught up in the compulsion for kool aid. I have profiled dozens of HELOC abuse posts over the years, and each one tells a story of greed and foolishness. If you want a deeper understanding of the motivations of various profiles in HELOC abuse, I recently encapsulated this phenomenon in the post HELOC Abuse Grading System.
The profiles selected each illustrate an aspect of consumer entitlement directly opposed to (1) wealth creation and accumulation or (2) personal responsibility and strength. The names and details have been changed or omitted to spare the guilty gratuitous embarrassment; I seek not to punish but to enlighten and inform.
Borrowing is weak
Dependency is weak, and borrowing is dependency; therefore, borrowing is weak. This simple deductive argument speaks to an oft-ignored truth; borrowing is weak. Saving and borrowing are dualistic opposites like strength and weakness, slavery and freedom.
The inescapable truth greets each debtor the moment their lender says "no." If a saver and a borrower each want something, the saver is in complete control of a purchase decision, whereas the borrower is utterly dependent upon lender approval. Have you ever been standing in line and watched someone's credit card be denied payment? Did the wouldbe purchaser seem strong and powerful to you? Did you cringe with embarrassment? I have — from both sides of the interaction.
The aging socialite
A reader emailed me about the property that became the post HELOC abuse Hollywood Style. The property was purchased in the early 70s in Hollywood for about $150,000. The property was owned by a frugal couple that paid down their debts. The husband died in the late 90s leaving the wife with a beautiful and historic property with millions in equity.
I can imagine the husband's state-of-mind and heart on his deathbed; he knew he provided well for his family, and although his wife might outlive him for quite some time, he was leaving her comfortably and securely set up for life. The inner peace he felt is something I covet for my own death. So should we all.
If there is an afterlife, and if we have the ability to look in on loved ones after we pass, I hope for this man's spirit that he resisted the temptation and rests in peace. Watching his wife either through foolish choices or bad advice spend the family fortune and be forced to abandon the family home — a home that had millions in equity at the moment of death — watching that from afar with no ability to intervene is more akin to hell than to heaven.
For the widow, she must move out of her stately mansion, destitute and alone with only memories of her life of entitlement and glamour to comfort her, or torture her, as she lives out her life in relative obscurity after her unceremonious fall from entitlement. Hopefully for her, California's social entitlement will survive to provide a minimal level of support.
The spendthrift landlord
Entitlement isn't always over the top, sometimes it is just flippant; a thoughtless attitude toward spending where people just obtain any object of desire at any time for any cost — and doing it like a big shot who is above it all.
A friend of mine (whom I am overdue to meet for coffee) told me this story of his now former landlord, a flippant spender quickly approaching his day of reckoning.
The owner had three properties; the one my friend rented was his original property purchased in the mid 90s for about $150,000, and a few months after my friend moved in, the owner received a Notice of Default on his $650,000 Option ARM. It turns out the owner used that money to buy another investment property and a $2,000,000+ Coto mansion at the peak in 2006. Based on the property records, we surmised he was facing about a $40,000 monthly nut on properties deeply underwater and precipitously declining in value.
What always struck my frugal friend was the cavalier attitude the owner had toward spending. The landlord would stop buy by in his pimped out truck, brag about decadent spending, and promise to fix items and fail to follow through. It was obvious that discretionary consumer spending took priority over other financial obligations including mortgages. Where is this guy's next cash infusion going to come from? What lender wants to pour grease down that gutter?
Outspending the Joneses
Truly successful and abundant people are unconcerned with impressing the neighbors or keeping-up-with-the-Joneses. Most inwardly flourishing people live joyous lives and keep a low profile because real wealth prefers anonymity to ostentation. However, the spiritually impoverished elevate themselves above others and seek to elicit jealousy. The jealous procure a fleeting power; addicted to the soul-drain of another, the jealous seek an endless charade of consumerism and comparison, and they pine for those ephemeral emotional payoffs when the jealous believe other people want what they have.
The compulsion toward jealousy leads some to recklessness as we witnessed in Ashes to Ashes; Dust to Dust where one family took out and spent $865,500, or in The Ultimate Post where the family absconded with $1,090,000 in lender money. Somebody has to be the trend setter, someone has to be the Joneses everyone else is keeping up with. When the Joneses are freebasing on lender crack, they set a very, very high bar. With no truly wealthy people spending such prodigious amounts, the Joneses actually surpass the spending of the wealthy they ostensibly emulate.
Is this wise behavior we should all imitate? Is the pleasure of spending and jealousy worth losing the family home? Carpe Diem?
The inconceivable owner
I remember a comment years ago from a married woman in her early 30s who could not conceive a scenario where she would not be owning a house in two years at most. WTF? Entitlement demanded she be housed in the property of her choosing in 18 to 24 months, and no matter the means or the outcome, it was going to happen. Let me provide images of her — absent a home — for her deficient imagination:
She could realize she cannot afford a home — not likely, but at least possible. Kudos if she does.
Her husband may realize she cannot afford the home and say no — not likely, unless he has a spine. Ditto above if he does.
Her family may not be given access to sufficient lender funds to obtain the property she feels entitled to, which means a lender has determined she cannot afford a home — a very likely outcome in the aftermath of the bubble. And wisely so as lenders just lost a trillion dollars lending too much.
It never occurred to this woman that the enablers of her entitlement may choose not to enable it further. Some lender may reveal her entitlement to be an illusion created in her own mind. Also, it never occurred to her that having the object she is entitled to could cause so much pain. Nobody who purchased in 2006 who has a rational understanding of the situation is rejoicing their good fortune.
The sophisticated financial manager
In the heyday of securitization, paper-pushers were tieing up any available, consistent cashflow and providing the owners with a huge, one-time infusion of cash. It was Enron accounting applied on an unprecedented scale. Emulating corporate titans, individuals embarked on personal Ponzi-Style finance and sought ways to liberate their equity for more productive and more indulgent pursuits. The money-changers eagerly embraced this new sophistication among the proletariat, which has come to view debt as something serviced rather than retired, something maximized rather than minimized, something chic rather than shunned.
The most egregious example I found was HELOC Abuse Laguna Beach Style where the owner took out over $5,000,000 in mortgage equity withdrawal. What did he do with that money? Was he saving a business? Was he partying and having a good time? Several not-so-astutely observed nothing wrong with the owner's behavior, as it was between the borrower and the lender. That sounds very reasonable until the lender looks to you and me to pay the loss.
“This gentleman makes a lot of assumptions – some of which are correct, and some of which are not. My business is largely about buying low, selling high, and utilizing equity to drive cash flow. The property has been a rental for 11 years. There are better opportunities, so I am selling to purchase some all cash deals. Good investors will use HELOC’s, but in this case there is nothing utilized on the 2nd. The other important aspect is to drive the total cost of your debt down among all the investments that you own – that is why this has been refinanced. Other properties are held all cash. Just funny how he interprets without all the data.”
I replied to the intermediary:
As for his statements about financial management, I think he is crazy, but if he feels good about it, good for him. He implies he took great care with the management of his cost of debt, but appears he was not as successful in managing the total amount of debt since the amount obviously ballooned out of control. Based on what he owes he is not going to net much cash out of this deal, and the only thing he really accomplishes is getting out from under the debt, which is a good thing. He extracted his cash and now he moves on. I don’t see where this improves his wealth much.
Why do people borrow themselves to oblivion? Because they can! Lenders enable this foolishness because they are siphoning borrower cashflow; lenders would prefer lifelong addiction, but if a few flame out, so be it. As long as wouldbe borrowers view this foolishness as reasonable, responsible and refined, it will continue. Crazy!
California's social entitlements and obligations
No discussion of entitlement is complete without discussing Our HELOC Economy. California's debt rating is among the worst of sovereign entities. Lenders simply don't believe in our willingness to raise taxes or cut spending to balance our budget. We are borrowing in the belief that tax revenues will return to bubble levels, and they won't. We are broke, and we are over borrowing because we want to maintain our entitlements.
I don't know what form it will take and who will get cut, but we will come crashing down to the level of support our economy sustains. It may be bond vigilantes making our debt so expensive we are cut off from borrowing. It may be a wise and concerted efforts among politicians to reign in our budget through thoughtful cuts and painful but necessary tax increases… (giggles to self). Or it may be that the economy replaces mortgage equity withdrawal with real productive output and State revenues improve… (not likely, but such denial is current status quo). Start watching California bond yields for signs of our upcoming political crisis.
Status is an internal perception about what people believe other people think about them. It has nothing to do with what other people actually do think about them (as if that mattered anyway).
For instance, I think the women on the The Real Housewives of Orange County are soulless gold-diggers. My derision is only eclipsed by my disrespect for the way they live, what they believe, and what they represent. However, they think I, and everyone else who knows them through the show, believes they are something special, something to envy as if they really have it "going on." They have status. Not because people regard them highly, but because they think people do. But I digress…
For people who don't have the internal strength to base their self worth on what they believe about themselves, they end up basing their self worth on their perceptions of what other people think about them. Once they have given their power away to others in this manner, people will expend tremendous amounts of time, energy and money in a vain attempt to influence other people — hence we have fancy cars, opulent houses, designer clothing, and all the other trappings of conspicuous consumption. In my opinion, this is a sickness (their mind control fails on me.) It is a consuming disease which fed on the borrowed money made available during the housing/credit bubble.
The Real Housewives of Orange County as form of entertainment sickens me as it appeals either to pure schadenfreude or ignorant emulation. Most watch and feel superior — how could you not — but some actually watch looking for role models or a how-to manual for being pretentious — a ghastly side effect our sons and daughters pay with their souls.
As you might imagine, I don't watch much TV, and I will probably not watch Thursday night's episode; however, if you feel like an overdose of schadenfreude, you can tune in and watch one pretending family endure the unceremonious fall from entitlement. Apparently, one family has been moving from one entitled situation to another, failing to pay any of their bills, and now they are facing eviction with cameras voyeuristically capturing the ceremonious, theatrical and educational fall.
One of a kind! Exquisite lakefront home with breathtaking 180 degree lakeview! Lakeview from almost everywhere. Owner spent $150K for numerous upgrades: Travertine flooring, Marble faced fireplace, Wood shutters, Custom paint,Custom leaded glass windows, Granite kitchen countertop, Beautiful kitchen cabinets, Stainless steel appliances, Granite tops in all bathrooms, Spa/tub in master bath, Recessed lightings, Mirrored closet doors & much more. Vaulted ceilings, Large masterbed with area for office, Breakfast nook, Inside laundry room, Large patio to enjoy the living on the lake.
Are there any rules of capitalization that realtors follow? It just seems random to me. "Wood shutters, Custom paint,Custom leaded glass windows" Why are any of those words capitalized? Is the writer treating commas like periods and capitalizing the first word after each one?
The high end has benefited from a lack of supply and low sales volumes. With lenders proceeding with foreclosure faster, we are starting to see the inventory we have been waiting for.
Since the Government deeply inserted itself into the housing market, the future has become far from certain, and we spent an agonizing year anticipating the release of inventory lenders have determined will never come. Two-thousand ten is a different year; lenders are foreclosing in earnest, and we are seeing the first of this inventory hitting the market.
Sales of California homes priced at $1 million or more tumbled for the fourth consecutive year in 2009, according to a report out Thursday.
The number of million-dollar-plus homes sold dropped 23.8% to 18,621 in 2009 from 24,436 in 2008, according to San Diego real estate research firm MDA DataQuick.
If we were experiencing a true, robust housing market recovery, why are sales at the high end falling year after year? Low volumes are sustaining asking prices (that plus denial), but actual sales continue to plummet, and unless the government is planning to subsidize this market, look for a crushing weight of pricing to fall at the $729,750 conforming limit plus available downpayment savings. Expect a dramatic squashing of the market down to the $800,000 to $1,100,000 range
The decline was the result of buyers holding back, a weak mortgage market for big loans and the drop in home prices over the last several years dragging the value of several houses below the $1-million-dollar threshold, DataQuick said.
"Prestige home sales are a unique subcategory of the real estate market. The buyers and sellers respond to a different set of motivations,” DataQuick president John Walsh, said. “In the multimillion-dollar price ranges, decisions are largely discretionary and aren't as dependent upon jobs, prices and interest rates the way they are for most buyers and sellers."
This article is focused on homes prices at $1,000,000 and above, and yet the reporter quoted John Walsh's statement about multimillion-dollar homes. The reporter is implying that the dynamics of real wealth have some bearing on the pretenders who own houses they believe are worth between $1,000,000 and $2,000,000 where the major disaster is coming. Multitudes of borrowers overextended themselves to get into houses in the no-man's land between the FHA limit and price points only the truly wealthy can afford.
The trend underscores the nature of the state’s housing recovery. Sales of California home sales at all price levels increased 16.9% percent last year, to 460,166 from 393,703 in 2008. One in 25 homes sold for a million dollars or more last year, while the year before it was one in 16 and was one in nine in 2006.
No, the trend underscores the nature of the State's housing fiasco; we have no housing recovery, and saying that we do doesn't make it so; although, it makes people feel good, and it keeps the high end in denial. Why are homedebtors idiots? Because they are lied to constantly.
Lower-end homes largely fueled last year’s buying spree as both investors and first-time purchasers sensed opportunity in steeply discounted foreclosure properties across the state.
The Federal Housing Administration, a federal agency that insures mortgages often used by first-time buyers with little cash for a down payment, has played a big role in supporting the market for lower-end properties in California and some move-up markets. In pricier California communities, such as Los Angeles County, the limit for FHA loans was increased to $729,750 from $362,790 less than two years ago.
But more expensive homes haven't enjoyed that same level of government support nor were they hit as hard by the subprime mortgage meltdown.
Traditional luxury markets are faring better than those that experienced large price increases during the bubble years. For instance, million-dollar-plus home sales in Riverside County dropped 48.6% last year while Los Angeles County saw a 13.3% decline.
Notice the subtle lie perpetrated in this sentence: "Traditional luxury markets are faring better than those that experienced large price increases during the bubble years." Did you read, "Traditional luxury markets did not participate in the bubble therefore, prices will not fall?" The writer intended for you to get that message, and it is deceitful drivel.
There is one, and only one, reason million-dollar-plus home prices have not fallen off a cliff: lenders have not been foreclosing and discretionary sellers are in denial, so both available inventory and sales volumes are very low. Demand is nearly absent, but if supply is restricted enough, prices don't fall. What we are left with is a huge market segment dominated by shadow inventory with nobody to sell it to.
Lenders are finally moving properties through the foreclosure system, and I am anticipating much more high-end inventory this year. Through the summer, demand may be sufficient as unsatisfied buyers exist from 2009, but their numbers will be depleted quickly, and once exhausted, prices will get pushed down by the weight of all this inventory. Financing will not return, and many properties will fall to the $729,750 limit plus savings. Have you noticed that the Irvine Company priced everything within reach of financing? If they believed the over $1,000,000 market was viable, they would be selling at those price points; they are not because no market exists there.
I am profiling many more Trustee Sale flips lately because there have been many more Trustee Sales, sales that simply were not occurring last year. The pace is quickening with some lenders clearing their books. Today's featured property is an REO the lender is hoping to flip for a price higher than its peak purchase price in 2006. Has the high end already fully recovered?
According to the listing agent, this listing is a bank owned (foreclosed) property.
Spacious five bedroom plus four and one half bath home situated on a private cul-de-sac in the gated community of Turtle Ridge. This home is like brand new through out. Gourmet kithcen offers stainless steal appliances, granite counters, travertine flooring. Upper level media/game room loft. Main floor bed and bath. Entertaining rear yard with custom designed pool, spa, outdoor kitchen, fireplace, courtyard fountains, water features. Plus much more
kithcen? Does the realtor still earn the gourmet kitchen graphic when he spells kitchen wrong?
How many of you were introduced to Carly Simon this way?
