Last fall the major banks all increased their foreclosure activities. Some banks may feel they are strong enough to take the necessary write downs, and B of A appears to be desperate for cash. Perhaps in anticipation of the Robo-signer settlement deal or perhaps out of a desire to clear out the shadow inventory, for whatever the reason, lenders are increasing foreclosure rates everywhere. Foreclosures on the Rise Again Published: Thursday, 16 Feb 2012 | 12:04 AM ET By: Diana [Read More...]
It’s no secret that Irvine condo prices are collapsing. The bottom rung of the real estate ladder is broken. Nobody can step up. Until these units find a bottom, the upper rungs of the market have no hope. – —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- [Read More...]
Loan owners with big incomes believed house prices were going up forever. They bought houses they could barely afford because they believed the additional cost of ownership over renting would provide them with a return on their investment. Buying a house was part utility through providing shelter and part investment through capturing rapid appreciation. Of course, the actions of buyers willingly overpaying for houses drove prices higher in a self-fulfilling prophesy. Like all Ponzi schemes, it went on until the [Read More...]
The resale price declines in Northpark are among the most severe in Irvine. Today’s featured property is asking 33% off the peak. It probably isn’t enough. Like the rest of Orange County, rents continue to strengthen. Rising rents and falling prices is making home ownership more attractive and affordable. Proprietary Irvine Housing News home purchase analysis 40 SPRING Vly Irvine, CA 92602 $468,255 …….. Asking Price $700,000 ………. Purchase Price 5/21/2006 ………. Purchase Date ($231,745) ………. Gross Gain (Loss) ($56,000) [Read More...]
Anyone who has read my writing before knows I don’t think principal forgiveness is a good idea. I believe principal forgiveness is the worst policy option because foreclosure Is a superior form of principal reduction. I don’t think I am being cynical when I say that the Obama administration is pushing principal forgiveness in an attempt to buy votes. Any economic benefit the policy may have is outweighed by the moral hazard it creates and the unfairness of the distribution [Read More...]
In late 2007 knife catchers were the first wave of buyers after the peak. This group thought the initial stages of the price collapse was a brief respite from rapid price appreciation. To them, the dip was a buying opportunity. To anyone who understood valuation, it was obvious the initial drop was the first step toward a major decline in prices. The knife catchers from 2007 are severely underwater, and many like the previous owners of today’s featured property simple [Read More...]
The decline in prices in the bubble-era neighborhoods like Woodbury have been truly remarkable. Today’s featured property was purchased right at the peak for $738,000. If the owner was hoping for continued double-digit appreciation, he was disappointed. Since 2006 when he purchased, the property has declined in value 8.5% per year for the last six years. Proprietary Irvine Housing News home purchase analysis 73 MISSION Irvine, CA 92620 $451,250 …….. Asking Price $738,000 ………. Purchase Price 5/19/2006 ………. Purchase Date [Read More...]
Redfin is the most popular real estate search site in Southern California. They track the most popular listings based on the number of views each receives. Below are some of the most viewed property listings in Orange County. Check them out. 9291 PARLIAMENT Ave Westminster, CA 92683 — $389,900 Competing Listings $419,500 15932 COMMONWEALTH Pl 0.11 miles 3 bd / 1.75 ba 1,291 Sq. Ft. $457,000 9281 JASMINE Ave 0.31 miles 4 bd / 1 ba 1,390 Sq. Ft. $385,000 [Read More...]
I have repeatedly made the argument that government intervention is counterproductive. However, politicians and federal reserve policy makers either don’t accept this simple fact, or they don’t care. Politicians need to look like they are trying because doing nothing — which is the proper course of action — makes them look helpless and inept — which they are. The same is true for the federal reserve, but they also have a mandate to keep their member banks solvent. Most of [Read More...]
Another Northwood condo rolling back a decade. This property was purchased on 11/19/2002 for $263,000. The lender took it back for the same price on 11/28/2011. They have marked it up a few dollars, but by the time is closes escrow, it will be a 2002 rollback. That puts every condo purchased in the last decade in Northwood below its purchase price and probably underwater as well. – —- —- —- —- —- —- —- —- —- —- —- —- [Read More...]
Homebuilders are optimistic by nature. I have been to many economic forecasts, and homebuilder economists always tell their audience the demand for homes will far outpace the supply. There is always a chronic shortage of housing according to homebuilding economists, and homebuilders must step up to meet this need. Homebuilders are like any other seller prone to hear what they want to hear and pay for economists to tell them the same. Unfortunately, homebuilder economists have been consistently wrong. Homebuilders [Read More...]
Rising rents, falling interest rates, and declining prices are making El Camino Real one of the most affordable villages in Irvine. All three factors are moving in favor of greater affordability. Today’s featured property is an REO that chased the market down all last year, so the bank decided to remodel to see if they could sell it in better condition. The bank’s loss will be that much larger, but perhaps they can find a taker now. – —- —- [Read More...]
Home owners and loan owners are different. Both experience changes to their net worth from fluctuations in the resale prices of houses, but beyond that, people who own property don’t benefit from the various bailouts designed to keep loan owners paying their mortgages. Most people who own a loan erroneously think of themselves as home owners. They are not. They are money renters who hold title only as long as they continue to pay the rent on the money they [Read More...]
Woodbridge is being hit particularly hard by the housing bust. With 75% of Woodbridge being condos, and with condo prices getting hammered, Woodbridge has become a bargain community relative to Irvine standards. Today’s featured property is being offered for 42.5% off its peak purchase price. This condo has declined in price nearly 10% per year every year since 2006. Double digit price moves are much more fun when they are going up. – —- —- —- —- —- —- —- [Read More...]
The newly announced foreclosure settlement deal should dramatically increase foreclosure rates because banks no longer have to worry about lawsuits over their foreclosure practices. Further, with impending sales of bulk portfolios to private equity groups, banks will be able to dispose of the REO once they acquire it at auction. With the two biggest impediments to foreclosure removed, banks have no reason to permit delinquent mortgage squatters to continue receiving free housing. Let the foreclosures begin. Foreclosure Deal to Spur [Read More...]
Thoughtful Remarks