NEWPORT COAST

With house prices rising, the value of lots and raw land is skyrocketing

Apr 262013

The valuation of land used for residential housing is mysterious and often misunderstood. The valuation of lots and raw land requires a detailed knowledge of construction and marketing costs as well as a good estimate of the sales price of the final product: a residential housing unit. In short, the value of a lot is the total revenue (sales price of the home) minus the costs of production and the necessary profit. Land value is a residual calculation. The value of a piece of land is whatever is “left over” after all the other costs of production and profits are [Read More...]

FHA insurance premium hikes will impact high wage earners most

NEWPORT COAST, NEWS

Feb 042013

FHA insurance premium hikes will impact high wage earners most

Housing markets in Coastal California are dominated by high wage earners. In the more affluent markets, the GSE conforming loan limit is $625,000, yet the FHA limit is $729,750. GSE conforming loans can be obtained with only 5% down with private mortgage insurance of around 0.62%. FHA loans previously could be obtained with 3.5% down with an PHA insurance premium of 1.25%. The FHA loan which only requires 3.5% down instead of 5% has been very popular despite the onerous insurance premiums because after a massive debt binge and severe recession, most potential homebuyers are still broke. The loan limits [Read More...]

Loanowner bailouts were designed to benefit banks, an insider’s view

NEWPORT COAST, NEWS

Nov 052012

Loanowner bailouts were designed to benefit banks, an insider's view

The bubble collapse was rife with denial caused by false rumors of homeowner bailouts. Many homeowners held out hope that if they could just keep current on their mortgage long enough, the government would come to their rescue in the form of a mandated bailout program. Many such programs were attempted, but if their stated goal was to keep loanowners in the properties they occupied, these programs were a dismal failure — thankfully. If they had succeeded, the moral hazard would have served to inflate an even more massive housing bubble in the future. Moral hazard is central issue in [Read More...]

OC housing market ratings and historic city values

NEWPORT COAST, NEWS

Sep 032012

OC housing market ratings and historic city values

California has a long history of real estate bubbles. Cycles of boom and bust range back to the gold rush in the nineteenth century. Over the last forty years, California has experienced three major real estate bubbles. Each of them had different causes and sprung forth from different circumstances, but they all shared the common cycle of irrational exuberance leading to a boom followed by a crash back to fundamental values of rental parity. Historic Valuations by city Over the last month, I commissioned Brian Nadel (thanks, Brian) to download MLS rental data back to 2000. From other sources, I [Read More...]

Strategic default opposed by realtors who want short sale commissions

NEWPORT COAST, NEWS

Jul 032012

Realtors favor anything which generates a commission and oppose anything which fails to irrespective of whether or not this is good for buyers, sellers, or the market. For example, realtors recently lobbied against allowing bulk sales of foreclosures to private equity firms. Why? Because those sales eliminate MLS sales which would generate commissions. There is no other reason. When it comes to short sales versus strategic default, I am indifferent. For loan owners who would benefit from reduced debt, either option solves their problems. I recently noted that strategic short sales are the moral alternative to strategic default. Perhaps the [Read More...]

Newport Coast resale prices spike higher

NEWPORT COAST

Mar 162012

Newport Coast Overview Median home price is $1,406,000. Based on a rental parity value of $971,000, this market is over valued. Monthly payment affordability has been worsening over the last 3 month(s). Momentum suggests worsening affordability. Resale prices on a $/SF basis increased to $545/SF to $579/SF. Resale prices have been rising for 1 month(s). Price momentum suggests unchanging prices over the next three months. Median rental rates declined $666 last month from $4,766 to $4,100. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 2 Proprietary OC Housing [Read More...]

Newport Coast REO more than 30% off the peak

NEWPORT COAST

Jan 012012

Newport Coast is being crushed by REOs. This property is discounted more than 30% from its peak purchase price, and the bank still can’t find a buyer. With more than 120 days on the market, more price reductions are on the way. – —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- — ————————————————————————————————————————————- [Read More...]

11 EUCALYPTUS Newport Coast, CA 92657

NEWPORT BEACH, NEWPORT COAST

Dec 092011

This Newport Coast property was purchased by a Ponzi in 2004 for $1.35M. The bank bought it back for $2M. The mortgage equity withdrawal must have been staggering. The bank is looking at a $500,000 loss. Houses priced over $1M are facing major pricing pressure from REOs like this one. ——————————————————————– This property is available for sale via the MLS. Please contact Shevy Akason, #01836707 949.769.1599…… sales@ochousingnews.com….. —— —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- —- – —— —- —- —- —- [Read More...]

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