From beach to foothills, from the L.A. border to Camp Pendleton, people are buying fewer Orange County homes than a year ago when a tax break was expiring for house shoppers.
For the 22 business days ending June 15 – freshest numbers from DataQuick — our region-by-region analysis of local real estate trends finds Orange County homebuying slicing up by geography this way …
Mid-county ZIPs: Median selling price $344,500 – had 723 sales, down 25% from a year ago. In these 25 ZIPs, the median price change was off 3.8% vs. a year ago. Example:16% dip in Santa Ana home sales in year
Beach cities: 484 homes sold in 17 ZIP codes in the most recent period, down 17% from a year ago. Median selling price? $695,000 in these 17 ZIPs. Median price change? Down 9.1% vs. a year ago.Example: South Coast home sales down 24% over year
North-inland: 646 homes sold in this most recent period, off 16% from a year ago. Median selling price? $425,000 in these 22 ZIPs. Median price change? Down 3.2% vs. a year ago. Example: 38% dip in Buena Park home sales
South inland: Median selling price $457,875 – had 859 sales, down 13% from a year ago. In these 19 ZIPs, median price change was down 10.1% vs. a year ago. Example:Ladera Ranch home sales tumble 31%
Also …
Combined, total homes sales in ZIPs in the north and mid-section of Orange County were -21.3% vs. a year ago as homebuying the rest of the county ran -14.7% vs. 12 months earlier.
North/mid-county homes accounted for 50% of residences sold in the most recent period vs. 52% a year ago.
All told, countywide sales were -16% vs. a year ago. The median selling price was -3% in the past year.
The good news is that next years numbers will look great by comparison.
10% off its early 2003 purchase price
The carnage at the low end of the market is truly remarkable. Today's featured property was purchased in early 2003 for $240,000, and now it is being offered in mid 2011 for $219,000.
The former owner was a typical Ponzi who put nothing down and milked the property for $84,000 before the ATM ran dry. His final loan was a $324,000 Option ARM with a 1.4% teaser rate.
Foreclosure Record
Recording Date: 02/02/2011
Document Type: Notice of Sale
Foreclosure Record
Recording Date: 08/02/2010
Document Type: Notice of Default
There aren't too many no-money-down Ponzis that have survived to 2011. I suppose this guy should be commended for hanging on so long… not.
Nice upper-level condo with nice-size kitchen, balcony and inside laundry. Walking distance to Irvine Valley College, parks, schools, shopping, Oak Creek Golf Course and North Lake. Great for investor or first-time buyer!
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Proprietary IHB commentary and analysis
This property barely breaks even for an owner occupant compared to a comparable rental. The only “investor” that would be interested in this property is a kool aid intoxicated one who is betting on appreciation that isn't going to happen for a while.
Resale Home Price …… $219,900
House Purchase Price … $240,000
House Purchase Date …. 4/2/2003
Net Gain (Loss) ………. ($33,294)
Percent Change ………. -13.9%
Annual Appreciation … -1.0%
Cost of Home Ownership
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$219,900 ………. Asking Price
$7,697 ………. 3.5% Down FHA Financing
4.49% …………… Mortgage Interest Rate
$212,204 ………. 30-Year Mortgage
$46,026 ………. Income Requirement
$1,074 ………. Monthly Mortgage Payment
$191 ………. Property Tax (@1.04%)
$0 ………. Special Taxes and Levies (Mello Roos)
$46 ………. Homeowners Insurance (@ 0.25%)
$244 ………. Private Mortgage Insurance
$40 ………. Homeowners Association Fees
============================================
$1,594 ………. Monthly Cash Outlays
-$98 ………. Tax Savings (% of Interest and Property Tax)
-$280 ………. Equity Hidden in Payment (Amortization)
$13 ………. Lost Income to Down Payment (net of taxes)
The spring-summer selling season of 2006 marked the peak of the housing bubble. Fannie Mae just lowered its projections and signaled the bust will drag on.
Despite the minor bear rallies, the housing crash continues. The beat does on. Prices peaked about 5 years ago with some markets peaking earlier and some later. With problems of shadow inventory looming over the markets, the bottom is not in place, and recovery is a distant fantasy.
By SHANNON BEHNKEN — The Tampa Tribune Published: June 24, 2011
TAMPA — It's an inauspicious anniversary. Five long years ago this month, the Tampa Bay area's supercharged housing prices finally ran out of steam, and the housing bust officially began.
Prices have been free-falling ever since.
The dips have slowed, even reversed at times, but every month new data shows median home prices are far below what they were the previous year. Sales, too, have struggled to regain forward momentum.
We've become painfully aware of the drumbeat of dour housing market reports. And yet, the question we all keep coming back to is this: How far will prices fall and how long will it take for them to bounce back?
If the history of deflating bubbles holds true, the bottom will be lower and later than anyone expects, and the time to bounce back will take much longer. How many people are holding out for 5,200 on the NASDAQ?
Area prices have already plummeted 46 percent. More than any time since World War II. More even than during the Great Depression, when the national average home price tumbled 31 percent.
Back then, it took 19 years for prices to recover. And get this: even though our economy hasn't been hit nearly as severely as in the 1930s, it will likely take the same amount of time for Tampa metro prices to recover from the latest downturn.
Not all economists think the turnaround will take decades, but Moody's Economy.com predicts it will be 2025 before median sales prices in the Tampa-St. Petersburg-Clearwater metro recover to the June 2006 median of $239,600. Compare that to the current median of $120,200 and consider that Moody's also expects local prices to fall 7 percent more before they begin to rise sustainably.
“It will be a long time because prices have fallen so much,” said Chris LaFakis, a Moody's economist who covers Tampa Bay.
The asymmetric nature of losses is a real problem. If prices fall 50%, it takes a 100% increase in price to regain the peak. Also, since historic appreciation rates include an unsustainable bubble, people who are anticipating 6% appreciation once prices bottom will be disappointed when 3% appreciation is the norm. Typically it takes 16 years for prices to double. In those markets where prices have dropped more than 50%, it will take 25 years or more to reach the bubble peaks.
Still, the area is in better shape than others. Florida as a whole could see prices fall 10.7 percent further, much more than the national average of 4.2 percent. And prices in Detroit, which has been hit much harder than Florida, won't likely hit its peak price again until 2035.
If you think that's gloomy, just listen to Stan Gerberer, an economist with Orlando-based Fishkind & Associates Inc. He said homeowners need to quit asking when prices will return to peak levels.
“The value was never there in the first place,” he said. “It's not reasonable to think prices will ever get back to those bubble prices.”
There is a truthful statement that won't help those in denial. Prices from the bubble were not real. We are not recovering. At best we will resume a normal rate of appreciation after prices have reached a fundamental value based on rental cashflows.
Consider this example Gerberer gave. If a home was worth $150,000 in 1995 and rose to $400,000 during the boom years, it's likely worth only around $250,000 now, he said.
“It's hard to imagine a scenario where the true value of that house would ever reach $400,000 again,” he said.
Prices will hit $400,000 again eventually, the current owner's grandchildren will consider that price reasonable.
That's bad news for homeowners who purchased during the boom years. Foreclosures are still ticking up in some areas and economists expect it to take years to work off the inventory.
But Mark Dotzour, chief economist with the real estate center at Texas A&M, doesn't like to compare today's housing slump with the Great Depression. It shouldn't take as long for the overall economy to recover as it did 70 years ago because unemployment isn't nearly as high, he said.
Unemployment was as high as 25 percent back then and is now hovering around 9.1 percent. Tampa Bay's unemployment rate is 10.5 percent.
“The magnitude of the situation isn't even comparable,” Dotzour said. “But the housing market is certainly in distress because of the massive job loss we have had.”
His assessment is partially true. Unemployment is not as bad as the Great Depression, but it is far worse than government statistic show. Since the Great Depression the government has revised its methodology to underreport unemployment. They no longer count discouraged workers, nor do they classify the underemployed as a problem.
However, Dotzour is more optimistic than Moody's.
“I think people are way oversold on the notion that housing isn't coming back,” he said. “Americans get carried away. We think whatever has happened in the past 24 month will go on forever.”
The real estate market's problems are largely attributable to the way the government has handled the downturn, Dotzour said. He points to bailouts and the home buyer's tax credit, which he says just prolonged the recovery.
“It can't possibly take 19 years for prices to recover,” he said. “I have faith that our government will figure it out before then.”
Being an Aggie, I want to support Mr. Dotzour; however, those comments are pure nonsense. Based on the bear rally of the last 24 months, Americans sustained denial of the problem and are likely more optimistic than they should be. Further, it can easily take 19 years or longer for prices to reach the peak because it was the peak of a housing bubble, not some appropriate price level from which we have temporarily declined. And worst of all, anyone who has faith that our government will figure it out should simply hide his head in shame.
As painful as it is for people to lose home, Dotzour said the market won't improve until foreclosure homes are resold.
“All these people who lost their homes will have to rent somewhere,” he said. “There's nothing wrong with that. That's the way America has always worked.”
I agree with those statements. Foreclosures are essential to the economic recovery. Renters move in and out of properties with changes in their income and employment status, and nobody gets worked up about it. Why are loan owners any different?
WASHINGTON (MNI) – Fannie Mae Monday revised down its estimates for both home prices and growth in the United States this year, noting that the key to the housing recovery remains the labor market.
“Weakness in economic activities spanning manufacturing, consumer spending, jobs, and housing has resulted in the group downgrading projected growth for the current quarter, as well as for the second half of they year,” Fannie Mae's Economics & Mortgage Market Analysis Group said in its June Economic Outlook.
Without job creation, there will be no new household formation. The unemployed don't buy houses.
The mortgage giant also revised down it projections for the 30-year fixed mortgage rate, which it now expects to remain below 5% through the second half of 2012.
The housing forecasts show the 30-year mortgage at 4.8% at the end of this year, compared with the May estimate of 5.2%. In fact, Fannie Mae said it is likely to remain under 5% until the second quarter of 2012, when it is projected to reach 5.0%.
Interest rates will eventually go back up, but it won't happen until the economy improves and lenders write off more of their bad debts. Low interest rates may be with us for a while.
“Prospects for accelerating growth have grown dimmer recently due to downward revisions of first-quarter economic activity and slowdowns across a broad set of indicators during May,” Fannie Mae said. As a result, it now forecasts 2.5% GDP growth this year, compared with a projection of 2.9% last month.
The 2.5% growth estimate is “more than a full percentage point lower than the forecast at the beginning of the year,” the report said.
Going forward, “Ultimately, the labor market holds the key to a housing recovery, but job growth is needed in order to activate housing demand,” said Fannie Mae's Chief Economist Doug Duncan. “Hiring delays will continue to push out timing for the housing rebound.”
Fannie Mae now sees the unemployment rate at 8.8% at the end of 2011, up from it's 8.5% estimate in May. The improvement in the jobs situation through the end of 2012 is also expected to be slower, with the unemployment rate now expected to be 8.6% at the end of 2012, compared with 8.0% in May.
Against this backdrop, home prices are not only expected to decline more than had been anticipated in May, but next year's rebound — while still expected to happen — is projected to be weaker.
The FHFA index is seen down 3.3% in 2011, compared with a 2.0% decline initially expected in May. In 2012, prices are seen recovering by 1.8%, compared with a 2.5% estimate in May.
The economy is not improving, partly because the homebuilding industry, which is usually a strong economic force in a recovery, is not growing. Until the plethora of the unemployed in real estate related industries go back to work, the economy is going to suffer.
The housing slump has been going on for nearly six years.
But it’s going to take another three or four years before the backlog of foreclosures that’s dragging the market down can be cleared, an Irvine housing consultant told Orange County business leaders Wednesday.
The housing market took a couple years to muddle back to normal after hitting bottom in 1995, consultant John Burns told the Orange County Forum’s luncheon on housing’s outlook. This time around, “the muddling will be a couple years more (than in the 1990′s) because the problems are more severe.”
John Burns is right. We have not dealt with the excesses of the housing bubble, and until we do, the housing crash will grind on.
Burns was one of three speakers at the forum. But the other speakers, both homebuilders, weren’t much more optimistic.
“We were really hopeful a year ago. … Today, it’s much more sobering for us,” said Standard Pacific Homes President Scott Stowell. “We’re still somewhat bearish.”
Emile Haddad, CEO of developer FivePoint Communities, said that a backlog of vacant homes in Orange County needs to be cleared up before homebuying demand can get back to normal.
May I take this opportunity to say “I told you so?” In my dealings with colleagues in the homebuilding industry (I've never met Stowell or Haddad), I have been consistently telling people what the two above are finally acknowledging. Nobody wants to hear from Cassandra.
That said, the speakers believe that Orange County is a bright spot in the housing market and will revive more quickly than other, harder-hit areas.
Highlights of their comments include:
Burns: “If you look around the country, nationally, there’s 3.1 million more vacant home than there are supposed to be. The good news is there’s only 19,000 of those in Orange County, and we’ll have all those cleared out sometime next year. Orange County and San Antonio will be the first two markets to clear up all of their vacant housing in the entire country.”
Haddad: Five Point Communities, which is managing housing and commercial development surrounding the Orange County Great Park at the former El Toro marine base, said his firm is on track to start building homes by 2013.
“That’s our story for the Great Park,” he said. “It’s a good story.”
Stowell: There’s a huge difference in sales in Standard Pacific projects in north and south Orange County. The company is selling five to eight homes a month in its two Blackstone projects in Brea, but in the Talega project in San Clemente, “We struggle to sell houses.” One reason, he said, is builder competition is stiff in in South County, but hardly exists in north Orange County.
Haddad: Immigrant and Generation Y buyers make up a significant amount of housing demand going forward. Both are looking for a more ubran lifestyle and want to reconnect to the larger community.
Two of the three above want to sell product in Orange County, so their comments should be taken with some skepticism. Further, despite having less vacant housing stock, Orange County has more unresolved mortgages in shadow inventory. In the beaten down markets, many more bad loans have been processed, and pricing is much closer to the bottom than to the top. There is little reason to believe OCs mortgage woes will be resolved quickly.
Fannie Mae and Freddie Mac: All three speakers expressed concerns about congressional proposals to eliminate the mortgage giants created to spur homebuying. Burns noted that the two entities are responsible for the bulk of liquidity in today’s housing market.
Added Haddad: “If the government makes the mistake and gets out of subsidizing housing, you could collapse the housing market.”
We can only hope so. The government will not exit the housing market all at once, but they will exit the over $471,000 market sooner rather than later. Building and selling at price points requiring jumbo financing is going to be a persistent drag on Orange County house prices making the bottom elusive and the recovery tepid.
2.5% annual appreciation since 2000
Today's featured property is a closed sale that was part of shadow inventory. The former owners put 20% down, and during the housing bubble, they didn't raid the housing ATM. Unfortunately, on 1/12/2007 they thought it was a good idea to take out a $880,000 Option ARM and a $109,995 HELOC. That $500,000 in mortgage equity withdrawal cost them their house.
Foreclosure Record
Recording Date: 05/10/2010
Document Type: Notice of Sale
Foreclosure Record
Recording Date: 02/08/2010
Document Type: Notice of Default
Perhaps they didn't care. They got more out of the property by refinancing near the peak rather than selling four years later.
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Blog Note: I have reorganized the presentation of property information to make a clearer distinction between MLS derived information and that which is proprietary to Irvine Housing Blog. Any comments or suggestions are appreciated.
APPROVED SHORT SALE!!!! Wonderful home in wonderful West Park Neighborhood. This elegant Vintage Plan home has a great layout with huge windows that give true illumination to this house. It further offers high ceilings, hardwood floors, plantation shutters, a gorgeous spiral staircase, one bed and bath on main level, separate family room with fireplace, large kitchen with island, a private back yard with cabana and built in BBQ. Separate laundry room with sink and storage, a good size loft/den that's perfect for a home office or play room. The bathrooms are very clean and well maintained that have tile flooring and double vanities. A huge master bedroom with stand up shower and tub. The community offer tennis courts, large playground, and gorgeous pool and spa.
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This property is no longer for sale.
Please contact Shevy Akason, #01836707
949.769.1599
sales@idealhomebrokers.com
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Public record and proprietary Irvine Housing Blog analysis
Resale Home Price …… $825,000
House Purchase Price … $625,000
House Purchase Date …. 9/12/2000
Net Gain (Loss) ………. $150,500
Percent Change ………. 24.1%
Annual Appreciation … 2.5%
Cost of Home Ownership
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$825,000 ………. Asking Price
$165,000 ………. 20% Down Conventional
4.49% …………… Mortgage Interest Rate
$660,000 ………. 30-Year Mortgage
$143,152 ………. Income Requirement
$3,340 ………. Monthly Mortgage Payment
$715 ………. Property Tax (@1.04%)
$0 ………. Special Taxes and Levies (Mello Roos)
$172 ………. Homeowners Insurance (@ 0.25%)
$0 ………. Private Mortgage Insurance
$40 ………. Homeowners Association Fees
============================================
$4,267 ………. Monthly Cash Outlays
-$796 ………. Tax Savings (% of Interest and Property Tax)
-$871 ………. Equity Hidden in Payment (Amortization)
$274 ………. Lost Income to Down Payment (net of taxes)
In January I asked, Did BofA get a sweetheart deal at the expense of the US Taxpayer? When B of A purchased Countrywide, the government agreed to backstop their losses after certain thresholds were met. This limitation on downside risk is the only reason B of A was willing to buy the steaming pile of mortgages on Countrywide's balance sheet. I don't know if we are on the hook for the losses recently announced, but B of A is getting serious about resolving the issues pertaining to the crap on its balance sheet and the liabilities it took on when it bought Countrywide.
Payment to investors for mortgage meltdown reportedly the largest ever
msnbc.com staff and news service reports — June 29, 2011
NEW YORK — Bank of America Corp said on Wednesday that it will pay $8.5 billion to settle claims from investors that lost money on mortgage-backed securities, in a landmark pact that could influence other major banks to settle mortgage claims.
This will establish a precedent other major banks will be forced to deal with. Expect to see more such announcements in the coming months.
The sum would be big banks' largest single settlement thus far related to the financial crisis that helped spark the Great Recession. The settlement, which Bank of America said would lead to a second-quarter loss, is subject to court approval.
“This is another important step we are taking in the interest of our shareholders to minimize the impact of future economic uncertainty and put legacy issues behind us,” said Bank of America Chief Executive Officer Brian Moynihan in a statement. “We will continue to act aggressively, and in the best interest of our shareholders, to clean up the mortgage issues largely stemming from our purchase of Countrywide.”
Notice the bullshit implication that B of A was largely responsible with its lending. B of A has huge problems with its own portfolio, but since B of A was less stupid than Countrywide, B of A can look relatively responsible in comparison.
Bank of America said the charges would include an additional $5.5 billion to cover expected payments to other mortgage bond investors.
As a result of the settlement, Bank of America said in a statement that it expects to report a net loss in the range of $8.6 billion to $9.1 billion in the second quarter of 2011, or $0.88 to $0.93 per diluted share.
As banks earn more money, they can write off more bad debt. This will ultimately help them stop the amend-pretend-extend dance and clean up their balance sheets. This is an important, albeit painful, step forward.
The $8.5 billion settlement covers claims from 22 institutional investors, including BlackRock Financial Management, Pacific Investment Management Co and Western Asset Management. The bank said the settlement is linked to mortgages made by Countrywide Financial Corp, once the nation's largest mortgage lender, which it bought in 2008. …
For several months, Bank of America battled claims based on estimates “that were much different from ours,” Moynihan said. But at this point, it made more sense to settle than to keep fighting, he said.
“We have said consistently if people are reasonable and can get to a reasonable assessment of their claims and it's in the best interest of shareholders, we will settle,” Moynihan told Wall Street analysts in a conference call.
Citi analyst Keith Horowitz said the settlement, which amounts to only 2 percent of the original principal balance, removes one of the largest investor risks for Bank of America.
“We think this could prove to be a step forward” for Bank of America, Horowitz said. It would show investors that the bank can manage through crisis without raising additional capital.
B of A settled for 2% of the original loan balances, and that is a reasonable assessment of the claims against them? Reasonable by B of A standards perhaps. There is no way that is reasonable by the standards of the investors, nor does it scratch the surface on the losses those investors incurred by buying the Countrywide trash.
The real story here isn't the settlement losses, it is what B of A has agreed to relative to its servicing operations.
Investor settlement includes promise to outsource 'high risk' mortgages
By John W. Schoen — June 29, 2011
Investors who bought bonds backed by shaky loans scored a major victory Wednesday with the announcement that Bank of America will pay more than $8 billion to make up for some of their losses.
Homeowners on the other end of those shaky mortgages — especially those most at risk of foreclosure — may have less to cheer about.
In the largest settlement to date related to the rogue mortgage lending wave, Bank of America said Wednesday it would pay $8.5 billion to settle claims with investors holding about $100 billion worth of mortgage-related securities sold by its Countrywide unit. The winners include 22 large investors such as Pimco, Metropolitan Life and BlackRock, as well as the Federal Reserve Bank of New York.
Aside from their claims that Countrywide sold them bonds backed by faulty loans, the investors argued that by continuing to service bad loans rather than speeding up foreclosures, the Bank of America unit ran up servicing fees, profiting at the expense of investors.
B of A and other major banks who service investor loans have two incentives not to foreclose. The first is as mentioned above; they make more money on the service fees than they make if they foreclose and terminate the mortgage. Second, the major banks have huge second mortgage and HELOC portfolios that are subordinate to the first mortgages they service for others. Each foreclosure causes them to lose everything on these underwater seconds.
The choice for the major banks is to keep obtaining their large service fees and keep their seconds alive or foreclose and recognize large losses. It shouldn't be a surprise they chose not to foreclose on loans they service for outside investors.
In Higher loss severities will force lenders to resolve bad loans and liquidate REO, I noted that “Each month a loan is delinquent it costs 1.5% of the loan balance in carrying costs. That is a troubling rate of financial decay. Time is the actually the bank's enemy when it comes to loan loss severities. Banks are providing squatters time in hopes they will get current and keep the zombie debt alive. Eventually, the carrying costs are going to make the loss severities so large that banks will either liquidate or implode, after which they will be liquidated anyway.”
As a result the settlement includes a promise to hire additional “subservicers” to speed up the foreclosure process for high-risk loans. That means Bank of America borrowers whose foreclosure have been on hold may now see the process accelerated.
“Living with the uncertainty of foreclosure can’t be a pleasant experience,” said Bank of America spokesman Jerry Dubrowski. “The sooner we can deal with that overhang the better for the economy.”
Did B of A start reading the IHB? Last November I argued that Foreclosures are essential to the economic recovery. I have also argued that keeping people in shadow inventory isn't good for the lender or the delinquent borrower. Until I read the statement above, I didn't think either group agreed with me.
Bank of America also faces considerable uncertainty as it continues to try put its mortgage woes behind it.
While the bank said its settlement would resolve “nearly all” its exposure related to mortgages issued by Countrywide, only holders of about a quarter of the securities have agreed to support the deal. Hundreds of investors holding an additional $300 billion worth of securities have yet to agree to the settlement, which also is subject to court approval. There are no guarantees that the remaining investors will go along.
Holdouts won't likely get a better deal, and they will merely waste attorney's fees trying.
“It is not possible to predict whether and to what extent challenges will be made to the settlement or the timing or ultimate outcome of the court approval process,” Bank of America said in its press release announcing the settlement.
At the height of the boom, rising home prices allowed mortgage originators to replace failed loans with freshly written performing mortgages. Lenders, investors and borrowers all assumed that there was little risk in churning out new mortgages — even if they were based on flawed information — because even if a loan defaulted, the rising value of the home securing it would minimize any potential losses.
But when home prices began falling, many of those bad loans came back to haunt the companies that had underwritten them. With demand for new mortgages drying up, there weren’t enough new loans to replace the ones that were going bad.
In the Great Housing Bubble, I pointed out that the entire subprime lending model masked its poor performance by an appreciating market — an appreciation induced by subprime lending itself. That was the Ponzi scheme embedded within the failed business model. Once prices collapsed, the high default rates translated into large default losses, and the risk became untenable. Hence, we have no subprime lending today, except perhaps for the FHA.
Now investors holding bad mortgages are demanding that lenders buy them back. Those investors include government-controlled lending giants Fannie Mae and Freddie Mac. In January, Bank of America paid $2.8 billion to Freddie and Fannie to buy back mortgages.
Bank of American concede in its press release Wednesday that that it “is not currently able to reasonably estimate” how much more it may have to pay to the two entities for losses on mortgage investments.
It’s also still not clear just how big the mounting losses on mortgage investments will be. With home prices still falling and mortgage defaults rates high, losses on foreclosed homes are hitting even those investors holding top-rated bonds. The ultimate cost of the claims will depend on how many more homes are lost to foreclosure and how much further home prices fall.
Bank of America also faces a potentially large payout to all or some of the 50 state attorneys general, who have been investigating abuses by the biggest mortgage servicers. The state officials are pressing the largest banks, including Bank of America, to pay up to $30 billion in fines and penalties. If a unified settlement can’t be reached, Bank of America could face multiple legal challenges from states that decide to pursue claims on their own.
Our banking system is still in jeopardy. It faces mounting losses, devalued REO, a huge shadow inventory, and falling house prices — which won't rebound because of the inventory they must liquidate. Fortunately for them, the federal reserve is loaning them money for nothing, and they can at least buy government treasuries earning 3%. Over time, a very long time, they will earn their way out of this hole. In the meantime, our economy will struggle.
A rare good deal?
The owner of today's featured property has owned it for a long time. My records go back to 1995, and it doesn't pick up the original purchase. This property is owned free-and-clear, so no lender approval is required to sell it. The asking price is at or below recent comps, and the cost of ownership is comparable to rental with today's 4.5% interest rate.
Even in today's weak real estate market, I don't expect this $244/SF property to last long.
If we see more pricing like this, I will become more bullish. The price is still too high, but the 4.5% interest rate is making it payment affordable relative to a rental. In high demand markets like Irvine, those circumstances will prompt people to buy despite the likelihood of lower prices.
Gorgeous remodel property with added/permite DEN . Light hardwood floors through the main level. New cabinets with granite countertops built-in refrigerator. All new appliances. all of the bathroom have been redone huge master shower and more and more. Den is added.
We have another Exclusive Access Property today. This one is a 5 bd/4.5ba in Northwood Pointe. It has a 3 car garage and is on a 9,121 square foot lot.
If you want to learn more about this property, please contact Shevy:
We've got a new Exclusive Access Property. It is a 4bd/2.5ba 2,870 square foot home in Northwood priced at $1,150,000. It is on a 10,725 sq ft lot and has a 3 car garage.
If you want to learn more about this property, please contact Shevy:
Published: June 24, 2011
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