Is this True?

NEW -> Contingent Buyer Assistance Program
[quote author="Serious Weapon" date=1238738999][quote author="bkshopr" date=1238644386][quote author="ipoplaya" date=1238644218][quote author="rick_r" date=1238642550]I was dropping my daughter off at school this morning and started talking to a fellow parent. The parent was telling me her frustrations with trying to buy a house. She stated every house that comes up in Irvine that she is interested in is getting snatched up right away.



Is this what everyone is seeing? I just don't understand. I still think the prices are sky high. I want to buy in Quail Hill or Woodbury and still looking for a 20-30% drop from current prices.



I make a good 6 figure income and still cannot afford a desirable house at these prices. Where do these people get their money, I just don't understand. My objective is 3 bed/2Bath 2000 sq ft, $450,000. Is that too much to ask.



I will not give in to the low interest rate tease. I would rather pay less for a house at a higher interest rate then more for it at a lower rate.



Opinions are appreciated.</blockquote>


The average days on the market value of Jan and Feb Irvine sales is around 50 days, so I believe that means that the typical Irvine property is hitting escrow within 2-3 weeks of going active... My perception is that anything priced reasonably is getting sold pretty quickly.



March prices are up over Feb and the velocity of sales, escrow activity, etc. has increased over the past month or so. We may see a couple of months of price increases, yes increases, during this Spring.</blockquote>




Hurry, hurry, hurry and buy before the good ones are gone! Ha, ha, ha.



Irvine is the cookie cutter capitol. There will always be another 30 clones that look exactly like the "good one".



Don't be a sucker and fall for the trick "there is actually a one of a kind house" so better buy now.</blockquote>


This is true... Unless the desired house is on a huge ass lot.</blockquote>


This is just too rare and only applies to product post and during Northpark.
 
[quote author="CapitalismWorks" date=1238708223][quote author="graphrix" date=1238676996][quote author="asianinvasian" date=1238665925][quote author="ipoplaya" date=1238665539]

I didn't say the recession would be over, I said:<blockquote>and the economy is bound to start improving by the end of this year</blockquote>A declining pace of job losses would be considered as improvement would it not? I seriously doubt that 700K people or more people per month will be losing their jobs in Q409 like they are now.</blockquote>


Job loss is a lagging indicator. The economy will have recovered well before the job loss does.</blockquote>


You are totally wrong on that. Jobs were increasing in 93, right when the economy started to recover. The funny part you neglect to mention is that the housing market continued to tank through 1996, all the while jobs were created.



Where did you take your econ 101 classes? They want to take your grade back, unless you did fail, which from this comment... it looks like you did.</blockquote>


Technically he is correct. Employment is included in the list of lagging indicators. Keep in mind that indicators do not always match the underlying economy. With employment the idea is that employers will not increase headcount without having a great deal of comfort in future growth. By the time employers have that comfort any recovery is probably well under way.</blockquote>


True, from a macro perspective, the employment numbers -663,000 (subject to revision) are a lagging indicator, but the jobless claims +161,000 (subject to revision) are a leading indicator. Mind you, both show a leading and even worsening lagging effect. However, from a micro perspective, employment is a leading indicator to an economic recovery. If you look at the recession of 90s, which is no where near as bad as this recession, it shows that the micro economic recovery did not begin until jobs started to recover. Not only that, but from a micro perspective, you will see that employment is a lagging effect to housing, in which it did not recover until a full four plus years later. Employment started to recover in 93, but housing prices didn't recover until 98 in nominal value, and not until 02 did they recover for inflation adjusted value.



So... to say that employment from a micro Irvine/OC perspective is a lagging indicator, and to assume that housing will follow in sync, is highly, extremely highly misleading from a true micro economic perspective. It will take several years, if not more years, than the 90s recession to recover in the housing compared to this recession. In fact, just like the economy recovered in 93, but OC saw record breaking foreclosures in 95 and 96, that I predict that 09 is like 93, and we will see the true carnage in 11 and 12.



Mark my words, write it down, print screen this, do whatever it takes. I know what it will take to return to the mean, and we will overshoot it. It's in the bag!
 
Deuce posted a Case-Shiller chart on the main blog this morning. It shows the last bubble peak of 89-91 at 130 (!) and shows the troughs at around 75. The peaks were over 230! We are still at 130 or so - right at the peak of the last bubble!



I can't get the links to the pictures to work, but here are the cites.



<a href="http://case-shiller.blogspot.com/2008/04/case-shiller-index-inflation-corrected.html">http://case-shiller.blogspot.com/2008/04/case-shiller-index-inflation-corrected.html</a>



<a href="http://4.bp.blogspot.com/_GLyD4Zq2bTE/SdIcPSeur2I/AAAAAAAAAKQ/vFhGpNg_IxI/s1600-h/case_shiller_real.png">Current 10 cities C/S Inflation Adjusted</a>



If we are going back to 75.............we are only halfway through this mess. Incidentally, that would put my neighborhood at 2.5x income and back at fundamentals.
 
If anyone ever come across a Case-Shiller chart for San Diego vs LA/OC, I will be very interested.



edit:

Nevermind. I just saw one posted by IR2 on the blog.
 
[quote author="graphrix" date=1238896499]I fixed it. People need to see this here.</blockquote>


I don't know why we are wasting our time. I really don't. I should take my own advice and leave the donkeys alone.
 
[quote author="rick_r" date=1238651680]So since all the young couples are getting down payments from their parents to buy these homes in Woodbury/Quail Hill. Do any of you want to volunteer to accompany me to my parents house to help convince them to loan me $150K? I will pay a 1% commission of the total borrowed amount!!!



I have two young children and a stay at home wife. How the hell am I going to save 20-30% down.</blockquote>


For now, look for cash flow positive properties elsewhere that you could buy, and rent in Irvine. Do your research carefully however.



Once you've build sufficient passive income from other sources, you can apply it toward a home purchase here.



I like Robert Kiyosaki's original book "Rich Dad Poor Dad". Don't bother with the latter books and don't make emotional buys with income property.



Please understand that you're competing economically against dual income households, so you must make the extra effort.
 
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