Housing Analysis

meccos12 · Oct 26, 2018

Compressed-Village said:
meccos12 said:

Compressed-Village said:

When you actually go inside of sale-office and ask about release phase and planned. Not sitting at home and browse the internet for what you want to prove. It also help when you visit park and swing by just a little chat to help you understand more. This is Irvine specific that I am referring to. Not OC as the article alluded you to.

Are you actively looking or just chime in when the sounds is already loud?

Click to expand...

Because talking to a sale office and chatting at the park is hard evidence that homes are being "gobbled up". LOL
I dunno about you, but ill take an article written in a major newspaper with numbers to back it up rather than speaking with someone at the park.

Click to expand...

I think you need to read closely a bit more. Next time when you go for a free water while you visit one of the new park at the new home builder in Irvine. Stop into the sale office and see what going on for pricing and inventory. Then come back and tell me something I didn't tell you already. Done.

So the best you can do is tell me to go talk to a sales rep? Cmon really? Should I go talk to the BMW salesman to see how awesome BMWs are? If you are going to make a claim that new homes are being GOBBLED up, then you need to step up and back it up with some evidence. And sorry telling me to go talk to a sales agent doesn't work for me nor probably anyone else here.

At least I gave you a credible article with NUMBERS that support my position. I'll be waiting for some evidence that shows new homes are being GOBBLED up, although I might be waiting a few years.

sgip · Oct 26, 2018

Fortune 11's comment on newspapers reminded me of an infographic I saw today. The source was unclear as it was in someone else's presentation, but on a percentage basis buyers of homes find properties in magazines at a .05% level, with only Newspapers coming in lower at .03%. Newspapers are dead information sources.

My .02c

meccos12 · Oct 26, 2018

USCTrojanCPA said:
I am getting calls from a handful of Irvine builders letting me know that they have bumped up their broker co-ops but most all of them have been for homes over $1m.

New homes are being GOBBLED up so fast, they are actually upping the brokers co-op...

fortune11 · Oct 26, 2018

Soylent Green Is People said:
Fortune 11's comment on newspapers reminded me of an infographic I saw today. The source was unclear as it was in someone else's presentation, but on a percentage basis buyers of homes find properties in magazines at a .05% level, with only Newspapers coming in lower at .03%. Newspapers are dead information sources.

My .02c

By news ?paper? I meanr the entity not the physical version

WSJ / NYT / Wapo still drive popular discourse ? and thereby generally serve as good contrarian indicators for market tops and bottoms

Exception being corporate fraud / other malfeasance etc where an NYT story can trigger an individual or corporate entity?s downfall and be the precursor (like NYT w Weinstein , Clinton server , etc)

sgip · Oct 27, 2018

True. Papers still have a place - just not advertising a home for sale. Papers were a very big part of Real Estate marketing through the early 2000's, but for all intents and purposes they are vaporized now.

One paper - South China Morning Post - had this article of note:
https://www.scmp.com/economy/china-...lass-take-big-risks-move-money-and-themselves

The mid-section - "Will the door slam shut" was interesting. A move by political leaders to name and shame individuals skirting capital controls seems to be causing great concerns. One wonders if this then started as a butterfly effect in June/July, magnified by the time it reached here in the US and elsewhere around the globe.

My .02c

irvinehomeowner · Oct 29, 2018

So you guys grilled me on why I thought not waiting is something I should be telling people.

I explained the parameters, gave my reasons, and even went into an over-detailed retelling of my experience to illustrate why waiting can be more trouble than it's worth.

As far as I know, only Mety has seen and understood where I am coming from.

If the "slowdown" is only 5%, is it really worth waiting? eyephone? meccos? kenkoko?

If the slowdown is 15-20%... then I can somewhat agree with eyephone's position, but do you three think Irvine will drop 15-20%? And if so... when is this going to happen?

Your turn to start answering my questions.

sgip · Oct 29, 2018

I know it would help me to quantify how a 5% to ??% price reduction is best quantified. For example, if a builder has a zero upgrade home at $1m that was formerly at $1.25 with upgrades, is that a price reduction? Technically yes, but these kinds of sales are hard to measure since most other homes might have been under contract 3-4 months earlier, with a dizzying array of upgrades made. If a resale home is listed originally at $1m, then reduces their ask to $950k, then closes at $975k, does it matter at all since surrounding homes have all sold for $975K? It looks like a price reduction, but was it simply a listing agent misprice?

How is this reduction in market value best defined? Average home price seem too broad a measure. Closing price to List price is difficult because the data is often manipulated by realtors.

What formula or sales examples might be best able to indicate market trends?

My .02c

SGIP

irvinebullhousing · Oct 29, 2018

The slow down all attributes to high price, higher rates, higher down payment, higher tax. This has clearly created two class. The have and the have-not. The ones that buying still buy and the one that waiting wishing for nothing but price to drop. Rates moving up rattled a lot of cages. The FED one of few ammunition is to keep ratching higher to combat future inflation gets out of hands and when / if the economy take a dump, FED will ease slowly and possibly cut slowly to regulate the slow down. Right now all that they see is growth and spending from GOP is out of control from tax cut. Growth is still there and growth will still happening in 2019.

paperboyNC · Oct 29, 2018

Soylent Green Is People said:
I know it would help me to quantify how a 5% to ??% price reduction is best quantified. For example, if a builder has a zero upgrade home at $1m that was formerly at $1.25 with upgrades, is that a price reduction? Technically yes, but these kinds of sales are hard to measure since most other homes might have been under contract 3-4 months earlier, with a dizzying array of upgrades made. If a resale home is listed originally at $1m, then reduces their ask to $950k, then closes at $975k, does it matter at all since surrounding homes have all sold for $975K? It looks like a price reduction, but was it simply a listing agent misprice?

How is this reduction in market value best defined? Average home price seem too broad a measure. Closing price to List price is difficult because the data is often manipulated by realtors.

What formula or sales examples might be best able to indicate market trends?

My .02c

SGIP

Kenkoko · Oct 29, 2018

irvinehomeowner said:
If the "slowdown" is only 5%, is it really worth waiting? eyephone? meccos? kenkoko?

I already answered your question but maybe you didn't see it. I think we will only see a 5% price drop by 2020. But I would not use this dip to buy because I see a potential doomsday scenario beyond 2020 with a US economy slowdown compounded by a China meltdown. If that happens, we could see a 15-20% drop and that will be the buying opportunity.

Yes, it's worth waiting for more clarity. These things take time to develop. We do not go from a bull market to a bear market overnight. To me, housing is in neutral with bigger downside potential than upside potential. So I'd wait.

We are already seeing a lot of signs of a China economy meltdown. China's trying hard to create a soft landing but it's not really working so far. This trade war is not helping either. We are also beginning to see some signs of a US economy cool-off. Just look at the Dow.

It's worth waiting because it has become much cheaper to rent in Irvine than to buy. Inventories are also going up, increasing the likelihood that you will find your perfect home.

fortune11 · Oct 29, 2018

Kenkoko said:
irvinehomeowner said:

If the "slowdown" is only 5%, is it really worth waiting? eyephone? meccos? kenkoko?

Click to expand...

I already answered your question but maybe you didn't see it. I think we will only see a 5% price drop by 2020. But I would not use this dip to buy because I see a potential doomsday scenario beyond 2020 with a US economy slowdown compounded by a China meltdown. If that happens, we could see a 15-20% drop and that will be the buying opportunity.

Yes, it's worth waiting for more clarity. These things take time to develop. We do not go from a bull market to a bear market overnight. To me, housing is in neutral with bigger downside potential than upside potential. So I'd wait.

We are already seeing a lot of signs of a China economy meltdown. China's trying hard to create a soft landing but it's not really working so far. This trade war is not helping either. We are also beginning to see some signs of a US economy cool-off. Just look at the Dow.

It's worth waiting because it has become much cheaper to rent in Irvine than to buy. Inventories are also going up, increasing the likelihood that you will find your perfect home.

You know in my line of work I have seen ?China melting down ? stories at least twice a year from serious professionals , they were gloating in 2015 but even then things managed to get a soft landing . The bass brothers got their clock cleaned out . Even the capital flight after the corruption crackdown did not do much to dent the story after a point .

But I am all ears ? this is valuable info

If you have color this time it is different than all those times in last seven or so years , please elaborate . I am genuinely interested . And so would be many others

There were anecdotes then , there are anecdotes now

How is hard data different ? How are Chinese consumers reacting ? Is more stimulus like this 5% reduction in auto tax , a big deal ?

Kenkoko · Oct 29, 2018

fortune11 said:
You know in my line of work I have seen ?China melting down ? stories at least twice a year from serious professionals , they were gloating in 2015 but even then things managed to get a soft landing . The bass brothers got their clock cleaned out . Even the capital flight after the corruption crackdown did not do much to dent the story after a point .

But I am all ears ? this is valuable info

If you have color this time it is different than all those times in last seven or so years , please elaborate . I am genuinely interested . And so would be many others

There were anecdotes then , there are anecdotes now

How is hard data different ? How are Chinese consumers reacting ? Is more stimulus like this 5% reduction in auto tax , a big deal ?

Fact - Stocks down over 50% since 2015. making lower lows every single year.
Fact - Economy growth rate drop from 14% in 2007 to below 7% last year. Growth rate lowered every single year.

FYI, it's a 50% auto tax cut not 5%.

There's also personal tax cut equal to 1% GDP. pretty drastic. I think we are way beyond anecdotal now. We have government interventions and that mean things are pretty bad.

People talk about " China meltdown" every year since 2015 because things have gotten progressively worse every year despite Chinese government's massive effort to prop up its economy.

I just read your previous response. While I agree with you on the stock market in China is not a great proxy for broader wealth (unlike here in the US), the reason behind it brings more concerns. Unlike US stock market where we have large percentage of institutional investors, Chinese stock market is 85% retail investors. Two thirds of these retail investors do NOT have a high school education. This is why you see big overall volatility and serious herd like mentality.

Since the crash of the shanghai stock market in 2015, Chinese investors have flooded into China real estate. The Chinese 100 City Price Index has RE prices at $202 per square foot. That's 38 percent higher than the median price per square foot in the U.S., where per-capita income is more than 700 percent higher than in China.

This bubble will pop eventually.

eyephone · Oct 29, 2018

Fun Fact:
If the S&P finishes negative this year. The last time the S&P finished negative was 2008.

fortune11 · Oct 30, 2018

Ok , semantics . It is cut from 10 percent to 5 percent . So yes 5 percent tax reduction or 50 percent of 10 percent reduction . Anyways that?s not the point

A 12.3 trn usd china economy growing at 7 percent is still a lot of growth compared to a 3.5 trn economy growing at 14 percent - this is basic mathematical flaw in using the % argument

Again , I am NOT a china expert . But I don?t think I have seen anyone layout a coherent argument here as to why this time is different . A capitalistic yet controlled economy like China has many levers it can pull to manage its situation .

Bullsback · Oct 30, 2018

eyephone said:
Fun Fact:
If the S&P finishes negative this year. The last time the S&P finished negative was 2008.

I'll add another fun/interesting fact. Dating back to the early 1920's, the S&P 500 has only had 6 years where its return was between 5-10%.

irvinebullhousing · Oct 30, 2018

How would ending citizen birth right affect housing? We know there are anchors babies and clinics all around OC and Irvine. Trump executive order will vow to end this almost immediately. What do you think to all the baby mama in Irvine will do, force induce labor before the quick enactment of executive actions?

Cares · Oct 30, 2018

Compressed-Village said:
How would ending citizen birth right affect housing? We know there are anchors babies and clinics all around OC and Irvine. Trump executive order will vow to end this almost immediately. What do you think to all the baby mama in Irvine will do, force induce labor before the quick enactment of executive actions?

I think there will be a negative impact to housing prices by way of lower demand of course. But I am of the opinion that foreigners, Chinese especially, still want to buy property in the US as a form of investment. I think there will still be demand to be in the US regardless of being able to become a citizen or not.

woodburyowner · Oct 30, 2018

Compressed-Village said:
How would ending citizen birth right affect housing? We know there are anchors babies and clinics all around OC and Irvine. Trump executive order will vow to end this almost immediately. What do you think to all the baby mama in Irvine will do, force induce labor before the quick enactment of executive actions?

The % of birthing houses is so low that it won't have any effect on housing prices.

I wonder if this executive order will create a market for sperm from US Citizens.

Cares · Oct 30, 2018

woodburyowner said:
Compressed-Village said:

How would ending citizen birth right affect housing? We know there are anchors babies and clinics all around OC and Irvine. Trump executive order will vow to end this almost immediately. What do you think to all the baby mama in Irvine will do, force induce labor before the quick enactment of executive actions?

Click to expand...

The % of birthing houses is so low that it won't have any effect on housing prices.

I wonder if this executive order will create a market for sperm from US Citizens.

Hopefully there's a market. Each pop can pay a month of mortgage and MR!

eyephone · Oct 30, 2018

Cares said:
woodburyowner said:

Compressed-Village said:

How would ending citizen birth right affect housing? We know there are anchors babies and clinics all around OC and Irvine. Trump executive order will vow to end this almost immediately. What do you think to all the baby mama in Irvine will do, force induce labor before the quick enactment of executive actions?

Click to expand...

The % of birthing houses is so low that it won't have any effect on housing prices.

I wonder if this executive order will create a market for sperm from US Citizens.

Click to expand...

Hopefully there's a market. Each pop can pay a month of mortgage and MR!

Belly aka YF is back? Jk

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