I have scheduled a party night at JT Schmids for Wednesday 16 June 2010 at 6:30 – 9:00. You are invited. I hope to see you there.
Irvine Home Address … 208 GUINEVERE Irvine, CA 92620
Resale Home Price …… $469,000
{book1}
There's a party goin' on right here
A celebration to last throughout the years
So bring your good times, and your laughter too
We gonna celebrate your party with you
Come on now
Celebration
Let's all celebrate and have a good time
Celebration
We gonna celebrate and have a good time
Kool & The Gang — Celebration
IHB News
Block Party
I have scheduled a party night at JT Schmids for Wednesday 16 June 2010 at 6:30 – 9:00. It has been over six months since our last gathering, but we are ready to revive the tradition. This will be primarily a social gathering, and everyone is invited. The IHB staff will be in attendance to talk real estate if you wish.
IHB Exclusive Access Properties
We have launched Ideal Home Brokers Exclusive Access Properties. We have an arrangement with a number of listing agents to provide an exclusive look at properties up to seven days before they are put on the MLS. These are generally not going to be REO properties that require am MLS listing before they can be sold. Depending on the seller, the properties may not be put on the MLS if the offer is attractive, and the property may bypass the MLS entirely.
Potential buyers have the opportunity to preview these properties before others in the general public are made aware of its availability. In our constricted supply market, exclusive access can be an advantage.
If you would like more information about this program, or if you would like to see any of the IHB exclusive access properties (like 26152 Via Pera Mission Viejo, CA 92691), please contact us at sales@idealhomebrokers.com.
Writer's Corner
I am becoming more comfortable with the daily cartoons; in fact, it is the most enjoyable part of the process for me. I have found that going with my first idea and working quickly generally gets the best results. I like reading the thoughts of bystanders in the cartoons, and my favorite this week was the family dog.
I have assembled a large database of American Gothic parody images, and each time I need to express the thoughts of homeowners, pulling up one of these usually does the trick. My two recent favorites are:
My favorite cartoon of the week was an afterthought, but each time I look at it, I still laugh. 
When a character in an image is looking directly at you, it is gripping. That is one of the features of the American Gothic images that works well.
Going on vacation
I am planning my family vacation for the last week of June through the 6th of July. I don't know yet what I will do for posts during that 10 days. I will have my iPhone, and I will be able to read the comments, but don't expect any long-winded diatribes from that interface.
Since I will have to do the posts in advance, they will probably be short, and the news won't be current. Maybe I can talk Zovall and Shevy into taking up the slack….
Housing Bubble News from Patrick.net
Fri Jun 4 2010
Why does government subsidize mortgage debt? (money.cnn.com)
Should you rent or buy? (money.cnn.com)
Bay Area jobs hit harder by recession than U.S. (sfgate.com)
Foreclosure storm continues in Central Valley (centralvalleybusinesstimes.com)
Public Union Parasites Move To Bar California Bankruptcies (Mish)
Greece to Sell Assets to Help Pay Down Deficit (nytimes.com)
Sydney quickly becoming the city few can afford to live in (nzherald.co.nz)
China's Housing Bubbles: Quality Research Required (scoop.co.nz)
Krugerrand Output Jumps to 25-Year High on European Debt Crisis (bloomberg.com)
Econophysicist Accurately Forecasts Gold Price Collapse (technologyreview.com)
Panic then silence over suspicious Chinese drywall (miamiherald.com)
Builder: Buyer-bait tax credit disappointing (washingtonpost.com)
National debt hits $13 trillion (washingtontimes.com)
Mortgage, credit card, student loan, auto loan debt also $13 trillion! (mybudget360.com)
"Banks" allow members to pay with time, not cash (news.yahoo.com)
Car dealer gets 12 years for mortgage fraud; used voodoo dolls targeting investigators (latimes.com)
Buyer on a stick (scroll down a bit) (patrick.net)
Bizarre ad about wrecking your house before foreclosure (givingbackthehouse.com)
Thu Jun 3 2010
Mortgage Walkaways Have Huge Incentive (cnbc.com)
The next generation of house buyers has too much college debt (bayarearealestatetrends.com)
Foreclosure crisis hitting hard on the west side of the Salt Lake Valley (sltrib.com)
Real Estate Dumbass of the Decade (longbeachhousingblog.blogspot.com)
Buffett Says He Expects `Terrible Problem' for Municipal Debt (preview.bloomberg.com)
Moody's Chief Says CDO Ratings Deeply Disappointing (businessweek.com)
Home-debtor epiphany (doctorhousingbubble.com)
Congress Eyes $15 Billion Construction Loan Guarantee Program (builderonline.com)
Realtors (TM) Want Congress to Corrupt the Tax Credit Timeline (blogs.wsj.com)
Five Failed Banks Cost the FDIC $317m, on Track for Record Year (housingwire.com)
Net worth of FDIC increased slightly, to negative $20.7 billion (fdic.gov)
Canada raises interest rates (finance.yahoo.com)
The Future Of America's Working Class (newgeography.com)
Strategic Foreclosure (patrick.net)
Wed Jun 2 2010
Foreclosures shifting to affluent ZIP codes (sfgate.com)
Bank price on some houses: 'Unrealistic' (mortgage.freedomblogging.com)
Latest Lie about Strategic Default: Borrowers Are Emotional Fools (irvinehousingblog.com)
Calif. jobless claims at record high (economy.freedomblogging.com)
Next Up — 5 Years of Financial Hell (safehaven.com)
Euro Bailout Plan is all about Rescuing Banks and Rich Greeks (Mish)
Clarke and Dawe: Lending merry-go-round (youtube.com)
China's shift away from cheap labor hard on all (news.yahoo.com)
China told property risk is worse than U.S. (cnn.com)
Answers on Credit Ratings Are Long Overdue (nytimes.com)
Is Massive Refinancing During Bubble Years a Ticking Bomb? (realestatechannel.com)
U.S. gov't still supporting ponzi scheme that will drag house prices lower (thepanicnews.com)
Federal Housing Finance Agency demands Fannie and Freddie drive the poor into debt (fhfa.gov)
Review of 'Life Would Be Perfect If I Lived in That House' (online.wsj.com)
Tue Jun 1 2010
Stop Paying The Mortgage, Live Free For Years (nytimes.com)
IMF Economist Argues House Prices Still Have Far To Fall (blogs.wsj.com)
New House Sales Set to Plunge in Former Bubble Markets (bloomberg.com)
21 year supply in Vegas high-rise condo market (lvrj.com)
NY Owners Bet on Raising the Rent, and Lost (nytimes.com)
The Property Tax: Unsung Hero (taxvox.taxpolicycenter.org)
CA's Prop 13 means tax burden falls on houseowners, not businesses (freedomblogging.com)
Ponzi scheme cases on rise in Bay Area (contracostatimes.com)
Go Ponzi, Young Debtor! How to Manage Your Finances The California Way (irvinehousingblog.com)
Arizona commercial real estate brokers: Some lenders ignore crisis (azcentral.com)
Commercial property owners facing declining rents (heraldtribune.com)
Hosed in Canada; Housing Crash is a Given (Mish)
Soldier in Iraq Loses House Over $800 Debt (motherjones.com)
Australian real estate agents accused of price inflation scam (abc.net.au)
Racing China: The Australia Housing Bubble (newgeography.com)
Deflation now, inflation later? (biztimes.com)
Lent, spent and guaranteed: The merger of state and corporate powers (theautomaticearth)
Building industry wants the U.S. Treasury Dept to guarantee builders' loans (hadd.com)
What Your 401k Really Costs You (usnews.com)
Student Loan Debt Means Slavery, Bankruptcy Not An Option (nytimes.com)
Irvine Home Address … 208 GUINEVERE Irvine, CA 92620 
Resale Home Price … $469,000
Home Purchase Price … $661,500
Home Purchase Date …. 12/22/2005
Net Gain (Loss) ………. $(220,640)
Percent Change ………. -29.1%
Annual Appreciation … -7.6%
Cost of Ownership
————————————————-
$469,000 ………. Asking Price
$16,415 ………. 3.5% Down FHA Financing
4.91% …………… Mortgage Interest Rate
$452,585 ………. 30-Year Mortgage
$96,118 ………. Income Requirement
$2,405 ………. Monthly Mortgage Payment
$406 ………. Property Tax
$167 ………. Special Taxes and Levies (Mello Roos)
$39 ………. Homeowners Insurance
$300 ………. Homeowners Association Fees
============================================
$3,317 ………. Monthly Cash Outlays
-$395 ………. Tax Savings (% of Interest and Property Tax)
-$553 ………. Equity Hidden in Payment
$31 ………. Lost Income to Down Payment (net of taxes)
$59 ………. Maintenance and Replacement Reserves
============================================
$2,459 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$4,690 ………. Furnishing and Move In @1%
$4,690 ………. Closing Costs @1%
$4,526 ………… Interest Points @1% of Loan
$16,415 ………. Down Payment
============================================
$30,321 ………. Total Cash Costs
$37,600 ………… Emergency Cash Reserves
============================================
$67,921 ………. Total Savings Needed
Property Details for 208 GUINEVERE Irvine, CA 92620
——————————————————————————
Beds: 3
Baths: 2 full 1 part baths
Home size: 1,950 sq ft
($241 / sq ft)
Lot Size: n/a
Year Built: 2006
Days on Market: 31
Listing Updated: 40312
MLS Number: S616084
Property Type: Condominium, Residential
Community: Woodbury
Tract: Wdgp
——————————————————————————
According to the listing agent, this listing may be a pre-foreclosure or short sale.
This is a three bedroom townhome style open floorplan that is perfect for entertaining. Bring your must discerning buyer and notice all the fine detail in the finely open gourmet kitchen. could have a main floor bedroom or office. Woodbury is one of the nations finest communties with a walk to destination mall amenties to fit any five star accomodations and the finest schools. Come see this gem. Model perfect.
communties? amenties? accomodations?
I suppose I’m missing something about the Mission Viejo condo.
It is quoted as being “not a short sale or bank owned property”, yet the details have it being purchased for $596K in March THIS YEAR and now being on sale for $279,990.
So who’s taking the loss?
It was me who was missing something. The previous sale data was for a different property, and it was supposed to be deleted. The Mission Viejo property is a trustee sale flip.
That doesn’t surprise me.
(And seeing as how I live about 15 hours flying time away, I have no way of knowing whether it’s a good deal or not. I know I’d be lining up my finance right now if a similar property was available for that price in MY city.)
That property looks decent but I’m not overly familiar with Irvine.
I have a question for the faithful followers here.
If one was to buy right now would you go with an FHA 3.5% down even with the 2.25% premium (which in some instances is financed too), or would it be better to put 20% down?
The low down payment seems to be a way of hedging your bet in case prices tank. If they did one could walk..err..I mean squat for a year or so and not lose much at all.
That’s not my intention but all these people working the system has got me thinking even though I could easily afford the 20% down on a good property.
Any thoughts?
Between the interest rate spread and the added insurance, putting 20% down is generally preferred. I have suggested people use FHA financing because the loan is assumable. This will have significant value when interest rates go up.
Does it make sense to do an FHA loan with a much larger downpayment? Do any costs disappear (like mortgage insurance)? Are rates any lower?
If you have money it would never make sense to use an FHA loan to buy a house due to fees and slightly higher rates.
If you had money it would only make sense if you were looking to default.
You have a knack for being consistently wrong:
Use FHA Financing: Loan Assumption is the Appreciation of the Twenty-Teens
Dude you have a knack for not understanding where interest rates are headed and what interest rates mean for housing.
You also have a knack for thinking Irvine is 1970s Indiana. LOL loan assumptions? Dude this is orange county, people seek distance in both life and transactions.
If you have more than 10% down, and can afford a 15 yr loan, then FHA (to get the assumable benefit) might be best.
There is NO monthly insurance on FHA 15yr < 90% LTV!
Doesn’t it depend on what you intend to do with the property? If you intend to flip it, you shouldn’t worry about increasing interest rates, And it also depends on your income, how much cash you have in reserve, whether this is a primary residence or an investment property, etc.
There were some comments a while back about one of the Real Housewives of Orange Country going into foreclosure. Well, per today’s NY Post the ‘virus’ of financial wrecks on this show has now spread to Teresa Guidice of Real Housewives of New Jersey who appears to be in bankruptcy. She made what I think was one of the classiest lines ever on this series “I’m thinking of getting my boobies done but my husband is an ass man”
Spendaholic Housewife owes $11m
Sorry didn’t get link right
Spendaholic Housewife owes $11m
My inclination is to put 20% down but not until prices fall a bit further closer to the coastal areas. (I’m in HB and I think it’s still way too overpriced here).
If I put 20% down today and prices fell by 15-20% I might be looking at a place that has lost 100k in value. That 100k can go a long ways towards my kids education(or even better my retirement). I was thinking by going FHA it might give me an easy choice about walking away in a couple (few?) years if the market tanked further.
My common sense tells me to wait but it’s getting tiring on the sidelines and the family is getting bigger.
JK, I’m looking at HB also. I will wait 2 more years until things settle down. I think we could easily see another 10-15% drop. I could see houses currently listed at 600K go for low to mid 500K range. Renting right now makes sense if you can save money, which I am doing. I imagine interest rates will be low for the next year or two and prices will gradually come down. And who knows what other economic events will transpire in the next two years…we are in unprecedented times.
I totally agree with you. We are leasing a place here while renting two other smaller condos we own in Long Beach.
My inclination is to offer low enough that would reflect a price drop if we saw something we liked or just wait it out. The wife is not as patient as I am though.
My question proposed is somewhat hypothetical. Given all the squatting we’ve seen and the year or more it takes for banks to foreclose it seems that a 3.5% FHA loan would make more sense in this market. If the market tanked you could walk away and not lose much. If you had substantial cash you could then go purchase something in cash after squatting for a year or more also.
I’m not saying this is morally right by ant means or that I would do this but after seeing how so many have milked the system I have to ask myself sometimes why not?
I might use FHA with 10% down on a very elegant old condo with incredible architecture that I’m looking at that is being offered at a ludicrously cheap price- a 3 bed 2 bath 1800 sq footer in my area for $75K. I could use my other cash to do some necessary work the place needs and, most important, because I want to maintain my cash reserve so that I never have a problem paying the maintenance and repairs and taxes (rather high).
But I might not be able to go FHA because it needs the work. It is 80% rehabbed but there still a few things to be done to make it habitable.
So, does anyone know if you can get FHA for a place that needs perhaps $10K worth of work and appliances to be livable? Is there a special type of FHA loan for a “fixer-upper”?
There is a specific FHA program for rehabs, but I don’t know who offers it.
It seems as if the govt is encouraging squatting with walkaway “3.5% down payments” that would not even cover the squatting mortgage or even the RE taxes and penalties for 2 years of squatting.
The govt. is encouraging less than honorable behavior or are they providing selective stimulus package or relief?
Is the featured property a McStacker– 1900 sf on 3 floors?
It is all on one floor of a really beautiful 91-year old 6-flat. The architecture is great, and most of the work has been done. It needs only to have the kitchen furnished with appliances, the major bath redone, and the millwork restored in the living room where it was “clean walled” half to death.
The neighborhood is a little dodgy, but I have many friends there. It’s very pretty, right on the lake, with good landscaping and many trees.
I have no intention of scamming, and I never, ever want to walk away. That’s why I buying for less than half what I can afford. This place, in top condition, would have fetched $300K at the peak, but I don’t expect it ever will again, and that’s not why I want to buy it. I just want it PAID FOR and in top condition in 6 years, but I want to hold on to my cash reserves in case things in the country in general get very bad… which I’m really afraid they could.
Depending on the seller, the properties may not be put on the MLS
So, the realtard is intentionally limiting the visibility on his client’s property, a clear violation of his fiduciary duties. Well, they’re realtards, so no surprise there.
if the offer is attractive, and the property may bypass the MLS entirely.
On the other hand, if IHBrokers can help them fool some sucker into overpaying by leveraging IHBlog’s rep for honesty and integrity, they’ll skip the hassle and expense of an MLS listing.
Truth? Integrity? Pfft, who needs ’em?!
I give massive props to IR for his work on the IHBlog, but everything that I see coming out of IHBrokers is a betrayal of those years of honest and candid work on the IHBlog. How did such a good and honest endeavor get co-opted by the same sleazy con-men that it set out to expose?
-Darth
You are exactly right.
By making it exclusive they are purposefully looking for someone to over pay with an FHA loan. It’s similar to sub prime targeting.
Darth,
Thanks for your kind words of support.
“Darth,
Thanks for your kind words of support.”
IR,
I’ll assume that you were being facetious, although I tell you truly that my words were delivered with a desire to help you and the IHBlog.
You DO have my support and so does the IHBlog! I frequently recommend this blog to my friends, and I never fail to mention it when I talk to people about local RE in particular or the national housing market in general. However, like I have said already, I simply have not seen that same brutal honesty-at-all-costs from the IHBrokers or the other RE selling activities that have taken place here since the IHBrokers was founded.
Everything from ignoring Shevy’s atrocious attention to detail to posting sloppy comps to pitching overpriced properties just as the Option-ARM wave is building momentum are all out of sync with the years of admirable work from IR and the IHBlog. From the couple of contacts that I had with IHBrokers and the other observations here on this blog, my impression is that IR is not very personally involved in IHBrokers other than posting information here. That is to his credit, imo.
It simply boils down to this: one portion of the organization is doing good things and always has been while the other portion is using this good name to peddle the same old realtard tricks. It is what it is.
-Darth
Yes, how dare IR give his readers first dibs to a property. How dare the owner give their permission for such a thing. How dare they find value in this. Burn them… hang them… call for the firing squad! Wheee… it’s fun being part of a mob!
No Darth. Putting aside the mindless lynch-mob mentality you are displaying, you are neglecting the essential fact that there is no requirement (or as you put it “fiduciary duty” [huh?]) for a house to be put on MLS. A house sale is a contract between the buyer and the seller. Usually, there needs to be a professional facilitor to make a market. While the widest possible dissemination of information is generally a good thing in a free market, if cost of entry into the free market is accepting that 6% of the sale price be paid to an under-educated, under-worked, vocabularily-challenged, and agency-conflicted realtor there is definitely some merit to trying some alternatives. So, good luck to IR in his new venture, which seems to me to be consistent with the overall philisophy IR has shown in his posts on the IHB.
My old neighborhood in Laguna Niguel was dominated by a certain realtor. During the peak bubble years, almost all his listings were exclusive (non MLS) for the first week or two. If the property was not sold after that period, it went on the MLS. What this did was almost guarantee the realtor would get both the buy and sell commision on the property a good part of the time. All it would take would be an open house where people came in with no realtor representation, if they liked the property…instant 6% commision. Supposedly this clown was making over 1M a year during the insane bubble years.
Week of finals for High School seniors (most of them are in full blown senioritys by now since the AP exams are done, scholarships are in and college acceptances are a done deal). Which means us parent got to keep an eye for the parties (Graduation is on June 22 at most IUSD high schools).
Week before finals for everyone else.. which means they got to study and need our help.
Dude, next time check out the IUSD schedule…. thanks for the thought though.
Wow. I haven’t been here in a while and I came back to see this web site turned into some commercial service peddling real estate.
Disappointed.
Home Address … 26152 Via Pera Mission Viejo, CA 92691
Only 4 pictures on the listing and no interior pictures. Why is that?
It’s a flip, you’re supposed to use your imagination in how you can enrich them with an exclusive FHA loan bid.
Agreed completely. Why in the world would the site owners think that a bunch of people interested in the housing market, specifically Irvine, want to be offered previews to local properties with IHB as a point of reference. Totally absurd. Now IR has changed his tune, began telling potential buyers to get in now at all costs, and I hear he’s even sporting a new Rolex while doing special guest cameos at NAR meetings. Obviously, he is their poster child. Nothing gets passed us. No, sir.
One should remember that the time and effort to write a blog daily has been freely provided. Had this been a University course you would have paid dearly to attend it. Consider as well the vast amounts of money IR and IHB has saved buyers by postponing purchases during the peak based on careful analysis of what’s for sale out there.
You cannot begrudge someone trying to make a dollar or so simply because of it conflicts with your current world view. The key word should be balance. The Sturm und Drang crowd can co-exist alongside those with the intestinal fortitude to purchase today. Simply sniping from ones Ivory Tower is unbecoming.
My .02c
Soylent Green Is People.
Soylent, I’m not sure if your comment is directed at me, but to clarify: what I wrote was written sarcastically and completely contrary to my own opinion. I apologize if that did not come across well. I figured from everything else I had commented on recently, my intent would be crystal clear. In truth, it is those who are constantly searching for something to knit-pick about IR that I find ridiculous.
My apologies. Normally my sarcasm detector is well attuned, but did not recognize your overall posting position on the matter. Certainly my bad. We are very much on the same page on the subject matter and recognize I need to adjust my meds before commenting 🙂
My .02c
Soylent Green Is People.
IR-why no commenting on the exclusive access properties? Also, don’t know MV rents much…how much would MV condo rent for?