A new escrow thread for a new housing market...

NEW -> Contingent Buyer Assistance Program
[quote author="usctrojanman29" date=1245825763][quote author="ipoplaya" date=1245823914][quote author="usctrojanman29" date=1245820619]

That was before tax, after tax I was looking at $2,500 and I did have a roommate that paid $800 a month so net, net I was in at $1,700 per month. Also, I had a 5 year regular ARM that was going to be adjusting in Jan. 2010.</blockquote>


So instead of saving the $2K per month that we all freaked about, it is actually $300 per month in savings? Still fabulous, just not exponentially so...</blockquote>
But then again, my income is down so my tax benefit on the margin would also be slightly down. It's still much easier to make a $1,400 housing payment versus $3,400. My housing expense will be going down another $150/month when my lease expires and I'll be moving to another IAC complex, plus I save about $100+/month on utilities. If I can find <strong>a nice 1,500 sf or so single story home with a decent yard</strong> for around $300k <strong>in a nice area</strong> AND I have a full-time job, I'll be a buyer.</blockquote>


They don't make those, much less for 300k. :-/
 
[quote author="25inIrvine" date=1245895149][quote author="irvine123" date=1245888765]assuming your buyer put down 20%, her net expenses on the houses after tax effect is similar to renting a 2/2 at IAC - around $2300 / month.



The house value might be down 20K to 40K, that 3 to 6% of the value in two years? If she considers this is her home, not an investment, and she can afford the payments, then I will say she made the right choice for HER family. There is no right or wrong, it is matter of life style and preference.</blockquote>


Isn't that 20% also quite a big difference? Rental you put down your deposit...like a months rent? The other one you put down over 100k of cash in order to get a comparable monthly expense?</blockquote>


Not really. The hard part is actually having 100k to put down. 100k in money markets are yielding next to nothing, so the opportunity cost is negligible. Of course, this could change if money market rates go back to 5% in a year or two. 5% of 100k = 5k. Less taxes = 3K. Around 250 a month. But this is offset by the principle component of the mortgage payment.



Also if money market rates really reach 5%, it means the fed is raising rates, economy is humming, and rents will go up, while the owner's payments will be fixed for 30 years.



So in summary, usc isn't saving much in terms of monthly payments, the buyer of his home isn't doing bad at all, and we can all see why Irvine prices aren't as low as we all thought 1-2 years ago. Many long term buyers who plan to stay in their home for a while are buying right now bc timing the market NOW isn't as clear and easy as it was 3 years ago.
 
A bunch of places fell out of escrow over the past week. I found 12-14 that went back active...



<a href="http://www.ipoplaya.com">Commencing update of 40 new escrows started over the past 8-9 days</a>. The pace of new escrow activity has slowed a bit this week.
 
IPO,

Do you have a conversion chart for price per square footage range against the index? For example if the previous index shows as 158, does that equate to $240 - $260 per square foot?
 
[quote author="PANDA" date=1245906450]IPO,

Do you have a conversion chart for price per square footage range against the index? For example if the previous index shows as 158, does that equate to $240 - $260 per square foot?</blockquote>


Nope, don't have one.
 
[quote author="ipoplaya" date=1245905259]A bunch of places fell out of escrow over the past week. I found 12-14 that went back active...



<a href="http://www.ipoplaya.com">Commencing update of 40 new escrows started over the past 8-9 days</a>. The pace of new escrow activity has slowed a bit this week.</blockquote>
Blame it on the appraisers and the higher interest rates.
 
Is this the push that Humpty Dumpty Irvine needs?



<img src="http://visibility911.com/blog/wp-content/uploads/2008/02/humpty_dumpty.jpg" alt="" />
 
Amazingly a place in VoC just closed at only 12% off peak purchase price. When VoC places are rebounding strongly (they have sold for 30-35% off peak), you know there is a rally going on!



<img src="http://www.ipoplaya.com/062609.jpg" alt="" />
 
Uh oh, several properties on my buyers radar scenes went from "contingent" to "active" status. Say it ain't so, appraisers/banks are crushing the hopes of would be buyers.
 
[quote author="usctrojanman29" date=1246171282]Uh oh, several properties on my buyers radar scenes went from "contingent" to "active" status. Say it ain't so, appraisers/banks are crushing the hopes of would be buyers.</blockquote>


So if appraisers are crushing buyers hopes, how are prices going up? Appraisers are obviously allowing sales prices today higher than previous comps... If they weren't, we wouldn't be seeing a price rally would we?



And BTW, that price rally is intensifying rather than abating. The CS index value for closes since 6/15 is 203. Sample size is decent with 42 homes. For the first half of the month, the CS value was 196. That is a pretty extreme in-month differential...
 
IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic.

By the way I bought a house in March so it is in my best interest for the market to go up or at least hit bottom. But I have to be honest I think we have a ways to go before we will hit bottom. How many homeowners in Irvine or in the better parts of the OC are sitting in their houses today and they haven't made a payment for over a year. The banks are doing nothing for at least 18 months. And there is another moratorium on foreclosures currently. The government's actions are a joke and eventually they will run out of options. The houses will eventually hit the market and drive prices further down. The option arms haven't even hit yet and that will definitely hit Irvine's home prices as it will hit the OC. Everybody has adjusted their lifestyle due to the economy. Unemployment continues to rise and self employed people like myself have seen their incomes drop. Interest rates can only go up. And you think Irvine has hit bottom. I still think we will see another 15-20% decline in Irvine. My two cents.
 
[quote author="hbguybill" date=1246201421]IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic. .</blockquote>


hbuybill, no offense either, but I don't think you understand what IPO is doing. Do you think IPO is doing a forecast or he is merely presenting actual data and drawing a trend for the past? Which part of the data is "unrealistic"? You think he "painted" a rosy picture, how do you think he painted? With his forecast, or with actual data?
 
[quote author="hbguybill" date=1246201421]IPO No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic. .</blockquote>


hbuybill, no offense either, but I don't think you understand what IPO is doing. Do you think IPO is doing a forecast or he is merely presenting actual data and drawing a trend for the past? You think actual data here is "very unrealistic"? You think he "painted" a rosy picture, how do you think he "painted"? May you just misunderstood the meaning of "paint" and "unrealistic"?
 
[quote author="irvine123" date=1246226205][quote author="hbguybill" date=1246201421]IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic. .</blockquote>


hbuybill, no offense either, but I don't think you understand what IPO is doing. Do you think IPO is doing a forecast or he is merely presenting actual data and drawing a trend for the past? You think actual data here is "very unrealistic"? You think he "painted" a rosy picture, how do you think he "painted"?</blockquote>
I agree with IPO that we are getting a bounce in pricing, but the fact remains that the market is not healthy. When the major of listings are short sales and the remainder are organic sellers who for most part have WTF, it causes buyers to get into a frenzy and willing to pay more than you might want to in the first place. I too am stating just pure facts....from my buyers' searches I saw 5 properties drop out of escrow on Friday alone. Sure the buyers that have 30%+ to put down shouldn't be affected too much by a lower appraisal, but for those on the margin it's a killer. Plus, if I'm a buyer and I see a 3rd party appraisal come in at $25k-$50k+ below the purchase price, it would throw cold water on my face and wake me up after winning the bidding war and reality sets in. I still stand by my statement that Irvine home prices will decrease and I tell this to my buyers so they go into buying a home with their eyes wide open. How much will Irvine home prices decrease from today? When do we hit the bottom? I HAVE NO IDEA!
 
[quote author="usctrojanman29" date=1246227751][quote author="irvine123" date=1246226205][quote author="hbguybill" date=1246201421]IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic. .</blockquote>


hbuybill, no offense either, but I don't think you understand what IPO is doing. Do you think IPO is doing a forecast or he is merely presenting actual data and drawing a trend for the past? You think actual data here is "very unrealistic"? You think he "painted" a rosy picture, how do you think he "painted"?</blockquote>
I agree with IPO that we are getting a bounce in pricing, but the fact remains that the market is not healthy. When the major of listings are short sales and the remainder are organic sellers who for most part have WTF, it causes buyers to get into a frenzy and willing to pay more than you might want to in the first place. I too am stating just pure facts....from my buyers' searches I saw 5 properties drop out of escrow on Friday alone. Sure the buyers that have 30%+ to put down shouldn't be affected too much by a lower appraisal, but for those on the margin it's a killer. Plus, if I'm a buyer and I see a 3rd party appraisal come in at $25k-$50k+ below the purchase price, it would throw cold water on my face and wake me up after winning the bidding war and reality sets in. I still stand by my statement that Irvine home prices will decrease and I tell this to my buyers so they go into buying a home with their eyes wide open. How much will Irvine home prices decrease from today? When do we hit the bottom? I HAVE NO IDEA!</blockquote>


I completely agree that they prices will decrease again but 1) they are not doing that today and 2) lenders, appraisers, or the like are not curbing the price rally to a material degree today.



My fear is that the price rally could be substantial enough that in a year from now for example, with price depreciation occurring beginning this Fall, we are not even back to where we are today prise-wise...
 
[quote author="ipoplaya" date=1246230846][quote author="usctrojanman29" date=1246227751][quote author="irvine123" date=1246226205][quote author="hbguybill" date=1246201421]IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic. .</blockquote>


hbuybill, no offense either, but I don't think you understand what IPO is doing. Do you think IPO is doing a forecast or he is merely presenting actual data and drawing a trend for the past? You think actual data here is "very unrealistic"? You think he "painted" a rosy picture, how do you think he "painted"?</blockquote>
I agree with IPO that we are getting a bounce in pricing, but the fact remains that the market is not healthy. When the major of listings are short sales and the remainder are organic sellers who for most part have WTF, it causes buyers to get into a frenzy and willing to pay more than you might want to in the first place. I too am stating just pure facts....from my buyers' searches I saw 5 properties drop out of escrow on Friday alone. Sure the buyers that have 30%+ to put down shouldn't be affected too much by a lower appraisal, but for those on the margin it's a killer. Plus, if I'm a buyer and I see a 3rd party appraisal come in at $25k-$50k+ below the purchase price, it would throw cold water on my face and wake me up after winning the bidding war and reality sets in. I still stand by my statement that Irvine home prices will decrease and I tell this to my buyers so they go into buying a home with their eyes wide open. How much will Irvine home prices decrease from today? When do we hit the bottom? I HAVE NO IDEA!</blockquote>


I completely agree that they prices will decrease again but 1) they are not doing that today and 2) lenders, appraisers, or the like are not curbing the price rally to a material degree today.



My fear is that the price rally could be substantial enough that in a year from now for example, with price depreciation occurring beginning this Fall, we are not even back to where we are today prise-wise...</blockquote>
Interesting piece of information for you and everyone else. One of my buyers was interested on 2 properties that fell out of escrow this week. I just spoke with both listing agents and apparently both properties fell out of escrow because the buyer for each property was laidoff while the property was in escrow. Looks like Irvine home buyers are immune to job losses.
 
[quote author="usctrojanman29" date=1246242155] I just spoke with both listing agents and apparently both properties fell out of escrow because the buyer for each property was laidoff while the property was in escrow. Looks like Irvine home buyers are immune to job losses.</blockquote>


Someone that is gainfully employed will probably come along and put those properties back into escrow this week...



I finally got my site updated to current. <a href="http://www.ipoplaya.com">61 new escrows added over the past 11 days</a>. Things had slowed a bit but picked up speed again.



I did find and note 4 that fell out recently. 10 out of the 61 new entries were recent fall-outs that went back under contract. They don't last long as active in this market.



Across my search spec I have 172 properties under contract in backup status. That is 30.5% of the listed inventory. That figure has been holding right around 30% for a while.
 
Are you serious? You bought in March and you think it's going down another 15-20%.

If someone saw a rosy picture, it would be someone who bought in march.



If you follow the blog, IPO's been the one hoping for a different kind of picture.

Why do you think he sold awhile back?



[quote author="hbguybill" date=1246201421]IPOP No offense but all of your posts I've seen sound totally like a Realtor or the NAR. You paint this rosy picture of the housing market that I think is very unrealistic.

By the way I bought a house in March so it is in my best interest for the market to go up or at least hit bottom. But I have to be honest I think we have a ways to go before we will hit bottom. How many homeowners in Irvine or in the better parts of the OC are sitting in their houses today and they haven't made a payment for over a year. The banks are doing nothing for at least 18 months. And there is another moratorium on foreclosures currently. The government's actions are a joke and eventually they will run out of options. The houses will eventually hit the market and drive prices further down. The option arms haven't even hit yet and that will definitely hit Irvine's home prices as it will hit the OC. Everybody has adjusted their lifestyle due to the economy. Unemployment continues to rise and self employed people like myself have seen their incomes drop. Interest rates can only go up. And you think Irvine has hit bottom. I still think we will see another 15-20% decline in Irvine. My two cents.</blockquote>
 
I don't think IPO is overly zealous in "the picture he's painting." Data is data and while prices are down, year over year sales are up...call them knife catchers, but it looks like there are a few people out there tired of waiting. He said himself he's not calling a bottom.
 
[quote author="rickhunter" date=1246274842]Are you serious? You bought in March and you think it's going down another 15-20%.

If someone saw a rosy picture, it would be someone who bought in march.</blockquote>


He did buy in March, in fact he posted about it. A very nice house, in a great location, that many here wish they could buy. Just because someone buys, does not mean they have to be unrealistic, and have the Kool-Aid induced optimism.



<blockquote>If you follow the blog, IPO's been the one hoping for a different kind of picture.

Why do you think he sold awhile back?</blockquote>


I'm confused by this remark. Ipo sold, <strong>rents</strong> a bigger place, and hopes for said bigger place to come down in price, so that it would be more affordable for him to buy vs. rent. As far as I can tell, Ipo would welcome another 15-20% drop with open arms.



Am I not understanding your point, or do hbguybill and I follow the blog more than you do? Because from these comments of yours, either you are not following the blog, or you are not conveying your point very well.
 
You must log in or register to reply here.
Back
Top