1990 - 1995 in Irvine compared to now 2006 - ????

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PANDA DREAMING OF IRVINE_IHB

PANDA DREAMING OF IRVINE_IHB

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I am very interesting in finding out more about OC's last housing recession from 1990 - 1995. I was only in high school then so my knowledge was very limited regarding recessions.



Few facts that i do know is that OC's job economy was heavily tied to the aerospace market. Between 1990 - 1995 the median homes prices fell from $242,358 to $209,400. It seems like 1990 - 1995 is only a small hill compared to the mountain we are in right now.



If you lived through those years in Irvine, I am very interested to hear what really happened back then. Any similarities/difference between then and now. Do you believe that this down turn will be much worse that 1990 - 1995.



Thank you for sharing.



http://money.cnn.com/2008/03/27/news/economy/irvine_subprime/index.htm?section=money_topstories- I read this article today at it seems like history is repeating itself. The subprime industry may very well be the aerospace industry from 1990 - 1995.
 
Housing price before the last recession were inline with consumer's income. Unemployment in the aerospace, defense and architecture were high. No one was buying reasonably priced homes. No new homes were built due to no buyers.



Housing at this "recession" have been WTF out of line with consumer's income fueled by creative sub-prime financing and get rich fast equity. Less unemployment this time around except for those in the mortgage business. People are waiting to buy reasonably priced homes. No new homes are being built due to no knife catchers.



[quote author="PANDA DREAMING OF IRVINE" date=1211960384]I am very interesting in finding out more about OC's last housing recession from 1990 - 1995. I was only in high school then so my knowledge was very limited regarding recessions.



Few facts that i do know is that OC's job economy was heavily tied to the aerospace market. Between 1990 - 1995 the median homes prices fell from $242,358 to $209,400. It seems like 1990 - 1995 is only a small hill compared to the mountain we are in right now.



If you lived through those years in Irvine, I am very interested to hear what really happened back then. Any similarities/difference between then and now. Do you believe that this down turn will be much worse that 1990 - 1995.



Thank you for sharing.



http://money.cnn.com/2008/03/27/news/economy/irvine_subprime/index.htm?section=money_topstories- I read this article today at it seems like history is repeating itself. The subprime industry may very well be the aerospace industry from 1990 - 1995.</blockquote>
 
this was originally posted byhttp://www.southoctracker.com/and you may find it usefull..



Here is a collection of headlines and snippets from the LA Times (remember the O.C. edition?) during the last real estate bust in the 1990s, in chronological order beginning in 1987 (the market was still on its way up, but there were some telling signs) and ending in 1997 (the bottom).



It's interesting to try and connect some of these headlines with some similar types of stories that are beginning to play out today. Also significant is the timing - compared to the past slowdown, this current one we're in seems to have taken far less time in getting from the "sales down but prices up" phase to the "sales and prices both down" state we're at now. Note: Graphic is from Piggington.com



Nov. 26, 1987

Home Resales Drop 13.6% in October, but Median Price Continues Upward

"It was the largest decline in Orange County sales of used homes in almost a year, a 13.6% drop in October, contrasted with the year-earlier month, for which the California Assn. of Realtors blamed rising interest rates...But because there were relatively few houses for sale in the county, prices inched upward."



Jan. 30, 1988

The Rise in County's Home Prices New Housing Here Might Be a (Gulp) Bargain

"Few people in Orange County-especially recent buyers-would argue that new-home prices are cheap here. However, by at least two standards of measurement, prices could be rising much faster than they have in the 1980s."



Dec. 21, 1988

County's Housing Prices Jump Again

"November's resale housing market performance may have been strengthened by a decline in mortgage rates during September and October, when most home buyers with transactions that closed escrow in November were shopping for a mortgage loan.

"'In terms of sales, this was the strongest November of the decade and one of the best months we've seen this year,' said association President Dale Colby, a Realtor from Glendora. 'In fact, home sales were up sharply from last November in every major region of the state.'"



Nov. 14, 1989

O.C. Home Resales Fall Nearly 20% From Third Quarter of '88

"Orange County home sales dropped nearly 20% in the third quarter compared to last year...It's those high prices that have finally hurt sales, the trade association (CAR) said, forcing all but the most affluent buyers out of the county. Only about one in seven county households can afford the average resale home."



June 27, 1990

House Resales Decline While Median Prices Climb

"The declining sales pace in Orange County, based on reports from area realty boards, represents a 35% decline since May, 1988, when new and used homes in the county were selling almost as fast as realtors could put up 'for sale' signs."



Oct. 17, 1991

Standard Pacific Suffers Effects of Market Slump Home sales: Earnings dropped 88% in third quarter but the firm's executives are optimistic about orders placed for homes"Standard Pacific L.P., suffering the effects of the deteriorated market for new home sales in California, saw its earnings plummet 88% and its revenue fall 41% for the third quarter."



Dec. 31, 1992

1993 May Provide Balm for Battered Housing Industry Homes: While 1992 sales were down 12%, traffic at builders' models held fairly steady, indicating pent-up demand "'It shows that there is demand but that the potential buyers still want deals,'" said John Shumway, president of Market Profiles, a Costa Mesa real estate marketing consultant. 'People are still waiting for prices to come down even more in Orange County, so they are out there shopping, turning over every stone looking for that deal.'"



Aug. 4, 1993

Southland home values lead U.S. -- Downward

"Housing prices in Los Angeles and Orange Counties have fallen further during the last year than in any other part of the nation...'"California's housing market used to be the locomotive that led other markets out of recession. This time, it looks like we're going to be the caboose.'"



July 13, 1994

County Home Sales Up 26% in 2nd Quarter Real estate: Housing developers attribute promising figures to `typical June swoon'

"In another sign of new vigor in the Orange County real estate market, second-quarter sales of new and existing homes jumped more than 26% from the same period last year...Local housing developers, however, were not especially enthusiastic about the second-quarter figures, noting that home sales are typically strongest during the summer months and predicting that higher interest rates will depress housing sales."



Dec. 6, 1995

O.C. Home Sales Up for a Change; Real estate: The first year-to-year increase in 13 months is slight but offers some hope that the slump is over at last

"Home sales in Orange County inched up slightly in November, marking the first year-to-year increase in 13 months and providing a small measure of hope that the real estate market is beginning to recover."



Oct. 11, 1996

Southland home sales up slightly; Prices stable

"Southern California's housing market continued to show signs of a slow but steady recovery last month as home sales rose slightly compared with year-ago levels and prices were stable."



Nov. 1, 1997

O.C. Joins Statewide Foreclosure Decline; Housing: Drop to fewest seizures locally since '92 follows increased sales, higher prices

"A backlog of unsold foreclosed properties can depress home prices long after the general economy begins to recover. So declining foreclosure numbers should support the recent trend toward higher prices, real estate experts say."
 
Thanks for the valuable info morekaos,



I thought that home prices went up from 1987 - 1990 and started to recover from 1996? Hmm I need to look into this. Those were the days you can pick a brand new Irvine SFR for $200k and a brand new SFR Newport Coast home in the $400k.



I remember my agent telling me back in 2006 that a housing recession was not possible because back in 1990 - 1995, home builders built out like crazy and now, especially in Irvine, the home builders are controlling the supply so that prices would not drop as fast. Is this a myth or fact?



I also remember as a sophomore in high school the northridge earthquake was all over the news. I also heard that there was a huge exodus of people leaving Los Angeles. The earthquake also accelerated the housing recession in 1990 - 1995. I am hearing rumors from many expert sources that another major earthquake will hit southern california that will be much bigger than northridge. If this really occurs this is another similar trend i am seeing. Is this a myth or fact?



Back in 1990 - 1995, I am assuming that a good 70% of Irvine was still farmland. Many doubted that Irvine will be the next los angeles in orange county, having one of the top job centers. Many also doubted that Irvine was a going to be a great place to live as it was still undeveloped. Demographics wise: 90 - 95% were white, and UC Irvine, Turtle Ridge, Turtle Rock, Woodbridge, West Park, University Park was pretty much the core neighborhoods, majority of the neighborhoods above Quail Hills did not exist. Is this a myth or fact?
 
[quote author="PANDA DREAMING OF IRVINE" date=1212015792]Thanks for the valuable info morekaos,



I thought that home prices went up from 1987 - 1990 and started to recover from 1996? Hmm I need to look into this. Those were the days you can pick a brand new Irvine SFR for $200k and a brand new SFR Newport Coast home in the $400k.



I remember my agent telling me back in 2006 that a housing recession was not possible because back in 1990 - 1995, home builders built out like crazy and now, especially in Irvine, the home builders are controlling the supply so that prices would not drop as fast. Is this a myth or fact?



I also remember as a sophomore in high school the northridge earthquake was all over the news. I also heard that there was a huge exodus of people leaving Los Angeles. The earthquake also accelerated the housing recession in 1990 - 1995. <strong>I am hearing rumors from many expert sources that another major earthquake will hit southern california that will be much bigger than northridge. If this really occurs this is another similar trend i am seeing. Is this a myth or fact? </strong>



Back in 1990 - 1995, I am assuming that a good 70% of Irvine was still farmland. Many doubted that Irvine will be the next los angeles in orange county, having one of the top job centers. Many also doubted that Irvine was a going to be a great place to live as it was still undeveloped. Demographics wise: 90 - 95% were white, and UC Irvine, Turtle Ridge, Turtle Rock, Woodbridge, West Park, University Park was pretty much the core neighborhoods, majority of the neighborhoods above Quail Hills did not exist. Is this a myth or fact?</blockquote>


Sorry but LMFAO!!



I dunno...your activity of late seems very "Troll Like".
 
Read again, this cycle has followed the same path of lower sales volume and higher prices (87-90) now (04-06) then the prices fell (90-97) now (06-??). People were leaving LA then for OR and WA. Now they went to AZ and NV. Don't sweat an earthquake...what happens happens.
 
i don't think you're a troll, panda... but some of your suggestions are overly simplistic. the difference between then and now will be based on inventory of new housing, inventory of existing housing, employment and income growth, interest rates, credit markets, the decisions of powers that be (TIC, fed govt, etc), and about 100 other factors.



<blockquote>I remember my agent telling me back in 2006 that a housing recession was not possible because back in 1990 - 1995, home builders built out like crazy and now, especially in Irvine, the home builders are controlling the supply so that prices would not drop as fast. Is this a myth or fact?</blockquote>


um... where have you been the past 18 months? i hope your agent bought plenty of "recession-proof" home builder stock back in 2006.



<blockquote>I am hearing rumors from many expert sources that another major earthquake will hit southern california that will be much bigger than northridge. If this really occurs this is another similar trend i am seeing. Is this a myth or fact?</blockquote>


i don't get this question. will a giant earthquake affect home values? yes, probably. in the long-run? probably not, unless it's so devastating that it forever causes southern calif to become undesirable to live in. in any case it's sort of a pointless question. sort of like, if russians drop a nuke on NYC, will it cause property values to plunge?



<blockquote>

Back in 1990 - 1995, I am assuming that a good 70% of Irvine was still farmland. Many doubted that Irvine will be the next los angeles in orange county, having one of the top job centers. Many also doubted that Irvine was a going to be a great place to live as it was still undeveloped. Demographics wise: 90 - 95% were white, and UC Irvine, Turtle Ridge, Turtle Rock, Woodbridge, West Park, University Park was pretty much the core neighborhoods, majority of the neighborhoods above Quail Hills did not exist. Is this a myth or fact? </blockquote>


what is the question here? it's hard to understand what you're asking when there's so much misinformation in the question. 70% of what irvine? irvine ranch? city of irvine? irvine was plenty developed in 1990, and was plenty diverse then. turtle ridge did not exist in 1990, west park was in its infancy, and neither were amongst the original core neighborhoods if that's what you're implying.



what neighborhoods are above quail hill? i believe TIC pushed back the start date for SKYPARK FLOATING VILLAGE until late 2010. or if you mean, the neighborhoods above quail hills in terms of pricing and prestige were instrumental in helping irvine become a desirable place to live... well, even that statement is retarded so i'm not sure where to begin.
 
[quote author="PANDA DREAMING OF IRVINE" date=1212017304]optimusprime, can you explain to me what you mean by "Troll Like"?</blockquote>


Acmpe says "overly simplistic".



That's very kind. I would describe your posts/questions as bordering on "lack of comprehension".
 
Questions seem vague and broad range even the experts in this forum have a hard time to zero in to the topic when it is so general. Acpme is trying to point out there are so many variables to the equation.



Think of your question like a math formula. 12=3x is a good question while 12=bx5y2a3b4c7d is a bad question because the unknown variables are so dependent on each other so a million answers are possible.



If you want to ask about "12" then narrow down your equation to 6+x or 4x where your reader could then use the minimal time to educate you rather than explaining the entire history of math.



Hope you get my "math"aphor.





[quote author="optimusprime" date=1212022158][quote author="PANDA DREAMING OF IRVINE" date=1212017304]optimusprime, can you explain to me what you mean by "Troll Like"?</blockquote>


Acmpe says "overly simplistic".



That's very kind. I would describe your posts/questions as bordering on "lack of comprehension".</blockquote>
 
Ok, I'll bite. I'm not sure its Troll-like either. Perhaps the Jury is still out. Panda, if you really don't know, I'll answer your question with my understanding of "Troll." Perhaps others will refine my understanding.



A Troll is a blogger/poster that pretends to be something he/she is not and who purports to futher points of view simply to either elicit the true opinion of others, or simply to annoy others. Over the history of this blog, we've seen many individuals "join in" and talk about all sorts of nonesense... everything from "the market is on its way back up," to "if you are looking for a real estate agent, contact me here..."



As someone who I assume is new(er) to the blog, you may not have had the opportunity to witness the history of trolls... or quite simply, those bloggers whose comments just don't seem "quite right." In my opinion, you seem just a little excited to have found this blog and to participate... and this excitement really reads through in your various posts... and might not sit well with longer standing contributors who are always on the lookout for Trolls...and for whom the newness of this blog has worn off and turned into more of a legitimate analytical sounding board.



I hope that you don't take this too personally, but I assumed that you really wanted an explanation for the commentary above... and I hope that as a blog, we can try to move past the personal and on to more important things like saving money, prediciting local housing trends, and crushing the Irvine Co at the bargaining table.
 
Opimusprime,

I feel the anti-Panda sentiment. Is my "Bearish Attitude" affecting you personally? Do you own a SFR House in Northwood II?



Guys, I did write the last post very quickly before i stepped out. My apologies for that. I admit that i am not very knowledgeable regarding the time period of 1990 - 1995 in Irvine and Orange County, but am very interesting in comparing similarities difference between then and now. That is the reason i wanted to throw the question out there to gather information.





"i don?t get this question. will a giant earthquake affect home values? yes, probably. in the long-run? probably not, unless it?s so devastating that it forever causes southern calif to become undesirable to live in. in any case it?s sort of a pointless question. sort of like, if russians drop a nuke on NYC, will it cause property values to plunge?"



Yes, I wanted see how much of an impact an earthquake has on home values.



what is the question here? it?s hard to understand what you?re asking when there?s so much misinformation in the question. 70% of what irvine? irvine ranch? city of irvine? irvine was plenty developed in 1990, and was plenty diverse then. turtle ridge did not exist in 1990, west park was in its infancy, and neither were amongst the original core neighborhoods if that?s what you?re implying.

what neighborhoods are above quail hill? i believe TIC pushed back the start date for SKYPARK FLOATING VILLAGE until late 2010. or if you mean, the neighborhoods above quail hills in terms of pricing and prestige were instrumental in helping irvine become a desirable place to live? well, even that statement is retarded so i?m not sure where to begin.



Obviously, my assumption was not correct on what neighborhoods were already built in 1990 - 1995 and also demographics. Therefore Acmpe cleared that up.
 
GrewUpinIrvine,



Thanks and I did not take it personally at all. I was indeed very excited to find this blog, and started to write everyday. Since my early 20s, I have loved and cherished Irvine as a wonderful place to live and wanted to see a blog like this ten years ago. Over time, you will notice that i am just an ordinary person, who is very passionate about irvine. Naturally if you love an area this much, you want to learn everything about it: the people, the history, the lifestyle, the beaches, and the housing.



GUII, thanks for the clarification on the meaning of a "Troll".



"move past the personal and on to more important things like saving money, prediciting local housing trends, and crushing the Irvine Co at the bargaining table."



I can't agree with you more.
 
it's not sentiment against you personally -- more like newbie backlash ;-)



basically you're asking, "is this housing cycle like the previous one?"



no, it's not. why? well, the answer lies in parts all over the place. go through the threads on foreclosures, escrow activity, inventory, see whats going with pricing for specific developments, and also the individual homes profiled on the main blog, mix in some of the general economic and headline news -- and put it all together yourself. because the answer you seek lies in understanding ALL of that.
 
Cliffs notes version:



1990-95 Housing Bubble is equivalent to a "Grenade"



2002-current Housing Bubble is equivalent to "Atomic Bomb"



The difference between now and then is the "FREE MONEY and EASY CREDIT"...which isn't around anymore.



Good nite and Thank you.
 
[quote author="PANDA DREAMING OF IRVINE" date=1212025692]Believe me,



I have been trying to the puzzle together piece by piece from different threads and different sites. There is no harm in asking for some help from the seniors is there?</blockquote>


Panda - let it go... and as a piece of unsolicited advice, avoid the "there is no harm in asking for help..." mantra. AKA: the response, reaction, apology, victimization blogging cycle... you will quickly find yourself the focus of everyone's ire... I've been following this blog for a long time, but have relatively few posts... you don't have to post everyday... and you don't have to respond to eveyone's posts... it feeds the fire... and distracts this blog.
 
<blockquote>Think of your question like a math formula. 12=3x is a good question while 12=bx5y2a3b4c7d is a bad question because the unknown variables are so dependent on each other so a million answers are possible.</blockquote>


BK, you are slipping. The answer to your so called complex math is mello roos divided by feng shui multiplied by prop 13 divided by Donald Bren's number of lawsuits filed by Joan Irvine Smith which will always equal a perfect amount of snark.



<a href="http://ocecon101.blogspot.com/2006/12/bubble-blah.html">Panda, go read the comments on this snarky bastard's blog</a>.
 
<a href="http://pdm.medicine.wisc.edu/19-4%PDFs/Shoaf.pdf">Oh, and if there is another earthquake, then more people will commit suicide</a>. Less people = less demand = cheaper houses.



What? What? Is that a bad thing to say, I don't think so, when it comes from medical professionals.
<fieldset class="gc-fieldset">
<legend> Attached files </legend> <a href="http://www.talkirvine.com/converted_files/images/forum_attachments/59_J5NnRNec8mFLC9Ylbgat.pdf" target="_blank" class="gc-files">Shoaf.pdf</a> <span class="gc-filesize">(188 B)</span> </fieldset>
 
<blockquote>Oh, and if there is another earthquake, then more people will commit suicide. Less people = less demand = cheaper houses.

What? What? Is that a bad thing to say, I don?t think so, when it comes from medical professionals.</blockquote>
Graph, can you check the link. I couldn't get it to work.
 
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