I just might buy

NEW -> Contingent Buyer Assistance Program
[quote author="socalhousingbubble" date=1208408804]I also would be careful to not dismiss the drop in value that will come over the next few years as <em>purely acedemic</em>. Granted, it isn't completely real unless one is forced to sell, but I hear folks who think they are close to purchasing offer the acknowledgement that they realize the value will drop, I'm in it for the long haul, etc. Frankly, unless you have an income or big cash reserves (ie, signficantly greater than your 20% downpayment), the psychological burden of paying on a asset that is significantly underwater is more than most realize. Before it has actually happened, it is easy to dismiss this as "theoretical," "only a paper loss," etc, but I don't personally know anyone for whom several hundred thousand dollars is actually meaningless. And I believe the only way for a loss of that magnitude to really not effect you is for the amount of the loss to be "in the noise" given your financial situation, <strong>not</strong> that you knew it was coming.



SCHB</blockquote>


Personally, I think about my kids and my wife. I wouldn't to saddle them with being underwater and having zero equity in the event something happened to me... One might plan to be somewhere long-term but car accidents happen, heart attacks happen, etc. Either my wife or I could become disabled and have significant medical expenses.



I need my life insurance money to set them up until college, not just dig them out of being underwater on a mortgage.



If I was buying a place today, knowing values would likely decline considerably, I'd make sure we each had enough money to pay off 2/3 of the mortgage and also both had good long-term disability coverage...
 
ipop,



you can by personal mortgage insurance in case anything happens to you for a lot less then a whole life policy.



thats what I would do, just get personal mortgage insurance so you don't have to worry, takes this out of the equation.
 
[quote author="skek" date=1208409655]



Good advice, and I would guess that anyone who knew it was coming and chose to buy anyway is probably OK with taking the magnitude of expected loss. </blockquote>


I used to assume that, but I've seen that in reality there is a disconnect and the loss did matter more than projected, even though the loss wasn't a surprise.



SCHB
 
SoCal -



I think that I have some idea of what you mean by individuals not appreciating the loss they may (will) face. I certainly know that I dodged a bullet with Stonetree Manor... and the thought of overpaying that much for a home that had two HOA and was otherwise treated as a detached condo (as opposed to the garden variety SFR) would have driven me crazy. I wouldn't have even had a small backyard to BBQ in... But I wonder if the angst would have been a factor of both price reduction (equity loss) and the knowledge that I could have had the SFR (that I am considering now). In the current scenerio - if/when the Villa Rose home reduces in value (as with other Woodbury SFR's) I'd be left to consider the possibility of having owned a Mill Fleurs home, or a Juliet's Bacony home... hmm, that might be a good point. Perhaps I'l stop by some of the Mill Fleur and Juliet Balcony homes first, before jumping in... so that I have a first hand view of what opportunity I could miss out on... but seriously, at some point (at least for me) I only need so much house...
 
[quote author="IrvineCommuter" date=1208405354]Grew, do not forget about 3 to 5 developments that are scheduled to start in Irvine in the next 2-3 years. Off the top of my head, I can think of Orchard Hills, Stonegate, Laguna Crossing, and Woodbury East. There will a lot of floor plans for you to see in those communities as well as old but popular floor plans from previous developments.



Also, another factor to consider is that you will be able to afford a "better" house in 2 to 3 years since prices will come down and you will have had a bigger down payment to put down.</blockquote>


IC - Do you know where I can find a map of all these developments on the same page?

Portola Hills / Woodbury is kinda far out there and boring, crowded.

Orchards is well, not yet started. Stonegate and Laguna C? Where's that?

Columbus Grove, too crowded of a feel to it.



I almost pulled the trigger too. I'm 99% sure I will buy at the end of the year though.

I'm looking at Columbus Square. For now, it's open and there's a particular Model I like.
 
Grew,



I totally empathize with your desire to make the purchase.



But huge plaudits to IPO (where is that damn "thanks" button?) for pointing out that the problem right now isn't "what if they drop another 10%", but it is that the rate of change (Velocity) is big and down.



How would you feel if the house you purchase drops another 40%?



there are still not a whole lot of people who can afford $600k, even more so if the economy continues to tank. look at what a $1.1M house in TR sold for in 1998.



Until the velocity of the decline starts to level, let alone reverse, it is really hard to predict where the prices will settle.



All the best luck, but be careful.
 
[quote author="rickhunter" date=1208411975][quote author="IrvineCommuter" date=1208405354]Grew, do not forget about 3 to 5 developments that are scheduled to start in Irvine in the next 2-3 years. Off the top of my head, I can think of Orchard Hills, Stonegate, Laguna Crossing, and Woodbury East. There will a lot of floor plans for you to see in those communities as well as old but popular floor plans from previous developments.



Also, another factor to consider is that you will be able to afford a "better" house in 2 to 3 years since prices will come down and you will have had a bigger down payment to put down.</blockquote>


IC - Do you know where I can find a map of all these developments on the same page?

Portola Hills / Woodbury is kinda far out there and boring, crowded.

Orchards is well, not yet started. Stonegate and Laguna C? Where's that?

Columbus Grove, too crowded of a feel to it.



I almost pulled the trigger too. I'm 99% sure I will buy at the end of the year though.

I'm looking at Columbus Square. For now, it's open and there's a particular Model I like.</blockquote>


Portola is too far away but I love Woodbury, especially Jeffrey side.



OH, Stonegate, and Laguna Crossing are all future developments. Stonegate is supposed to on the Eastern side of Irvine Blvd. across from Woodbury and Woodbury Town Center. Laguna Crossing is nearly the 133 and the 405/5 area.



Being the IC shill that I am (Yes, I am the IC mole. . .notice the same abbreviation).. . . here is the Irvine Company site about the developments:



<a href="http://www.villagesofirvine.com/Villages-and-Residences/Future-Villages.aspx">http://www.villagesofirvine.com/Villages-and-Residences/Future-Villages.aspx</a>



<a href="http://www.ocregister.com/ocregister/news/local/article_1634847.php">http://www.ocregister.com/ocregister/news/local/article_1634847.php</a>
 
[quote author="IrvineCommuter" date=1208412767][quote author="rickhunter" date=1208411975][quote author="IrvineCommuter" date=1208405354]Grew, do not forget about 3 to 5 developments that are scheduled to start in Irvine in the next 2-3 years. Off the top of my head, I can think of Orchard Hills, Stonegate, Laguna Crossing, and Woodbury East. There will a lot of floor plans for you to see in those communities as well as old but popular floor plans from previous developments.



Also, another factor to consider is that you will be able to afford a "better" house in 2 to 3 years since prices will come down and you will have had a bigger down payment to put down.</blockquote>


IC - Do you know where I can find a map of all these developments on the same page?

Portola Hills / Woodbury is kinda far out there and boring, crowded.

Orchards is well, not yet started. Stonegate and Laguna C? Where's that?

Columbus Grove, too crowded of a feel to it.



I almost pulled the trigger too. I'm 99% sure I will buy at the end of the year though.

I'm looking at Columbus Square. For now, it's open and there's a particular Model I like.</blockquote>


Portola is too far away but I love Woodbury, especially Jeffrey side.



OH, Stonegate, and Laguna Crossing are all future developments. Stonegate is supposed to on the Eastern side of Irvine Blvd. across from Woodbury and Woodbury Town Center. Laguna Crossing is nearly the 133 and the 405/5 area.



Being the IC shill that I am (Yes, I am the IC mole. . .notice the same abbreviation).. . . here is the Irvine Company site about the developments:



<a href="http://www.villagesofirvine.com/Villages-and-Residences/Future-Villages.aspx">http://www.villagesofirvine.com/Villages-and-Residences/Future-Villages.aspx</a>



<a href="http://www.ocregister.com/ocregister/news/local/article_1634847.php">http://www.ocregister.com/ocregister/news/local/article_1634847.php</a></blockquote>


Thanks shill/mole. Apartments are already going up in Stonegate now... I can't imagine any SFRs going in until 2010 though. Wonder if the lots will get even smaller. 2900sf on a 4000sf lot maybe? Tack on $8K in mello roos and you have yourself a bargain, NOT!
 
[quote author="GrewUpInIrvine" date=1208411679]



...I'd be left to consider the possibility of having owned a Mill Fleurs home, or a Juliet's Bacony home... hmm, that might be a good point. Perhaps I'l stop by some of the Mill Fleur and Juliet Balcony homes first, before jumping in... so that I have a first hand view of what opportunity I could miss out on... but seriously, at some point (at least for me) I only need so much house...</blockquote>


Glad you are keeping an open mind. I understand (and happen to agree with) the idea that one only needs so much house. I think you know this, but I'll continue to be the angel on your shoulder reminding you the overpayment being expressed in same house for a lower price isn't really any less of a material loss than the additional house you could buy for the same money at the same ponit in the future. I hear you hinting that these are more different than they really are.



SCHB (not SoCal) :)
 
According to Irvine Co., OH is not set to open until 2011. . .LC is scheduled to open in 2010.



Also, there was another development within Woodbury that was delay. . .I think it was called Adalucia.
 
[quote author="IrvineCommuter" date=1208415412]According to Irvine Co., OH is not set to open until 2011. . .LC is scheduled to open in 2010.



Also, there was another development within Woodbury that was delay. . .I think it was called Adalucia.</blockquote>


Andalucia, by Cal Pac. Models are built and collecting dust... Pretty much Portisol reincarnated. The lots there lots uber tiny.
 
[quote author="skek" date=1208409655]Good advice, and I would guess that anyone who knew it was coming and chose to buy anyway is probably OK with taking the magnitude of expected loss. ...</blockquote>


One thing I learned from the stock market, talking about 30% loss and living a 30% loss are too different things. Telling yourself it's inevitable and part of the normal cycle and holding the course is the right thing, while the right thing, still just sucks. For a home, it turns the home from home to a prison.



For security, unless you're independently wealthy, you aren't. If you own and run a mid-size company you might be. If you're one of the many self-employed, you aren't. Any of the range of service industries you're not. Government employee, not. Corporate buy-outs happen, economic slowdowns happen, executive derelicts happen...



Did you mention the wife is secure in her employment? You also mention 'growing' into the house. Growing means kids, which means pregnancy or adoption both of which means time off for one or both parents and substantial new expenses. Alternatively, growing means aging parents, ditto on increased expenses.



Part of this discussion is are you a payment person or a capital person. For a one million dollar plus home, I'd hope capital, but most buying have been payment thinkers. At a million, even at 6%, depending on mello-roos, insurance, maintenance, taxes and add in lost investment and before tax you're looking at eight bills plus a month. If you can afford that, taxes are high but AMT stinks too. So...
 
[quote author="No_Such_Reality" date=1208431562][quote author="skek" date=1208409655]Good advice, and I would guess that anyone who knew it was coming and chose to buy anyway is probably OK with taking the magnitude of expected loss. ...</blockquote>


Did you mention the wife is secure in her employment? You also mention 'growing' into the house. Growing means kids, which means pregnancy or adoption both of which means time off for one or both parents and substantial new expenses. </blockquote>


Amen to the expense related to kids. We had no idea before we started having kids how expensive they are. Forget the food, diapers, baby gear, medical expenses, endless amount of clothing, toys, activites, etc., we sink $2500 per month into daycare costs. That is on an after-tax basis! Hopefully all our would-be child-less buyers on this blog are building in a big cushion to accomodate that in their monthly budgets or plan on making $50K more in gross comp before they start popping out the kiddies...
 
GrewUp

There are a lot of good comments on this thread that you need to consider.

However, as you can see everyone?s situation is different.

I believe you should embrace the ?The time to win is now? mentality and go for it.

As long as it pencils and you can afford it then do it.

No regrets, second-guessing or looking in rear-view mirror.

Don?t put those dreams on hold any longer.
 
[quote author="tenmagnet" date=1208468813]GrewUp

There are a lot of good comments on this thread that you need to consider.

However, as you can see everyone?s situation is different.

I believe you should embrace the ?The time to win is now? mentality and go for it.

As long as it pencils and you can afford it then do it.

No regrets, second-guessing or looking in rear-view mirror.

Don?t put those dreams on hold any longer.</blockquote>


I am not sure sure where this comment hits on the sarcasm level. . .0 or 100
 
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