MLS Irvine Closed Sales since 1/1/2006

NEW -> Contingent Buyer Assistance Program
Grew UpInIrvine,



I have no faith in the dollar and believe it will continue to tank. That is what i am doing for the past 4-5 years to have the same buying power as the foreigners (Especially the Chinese.) Most of my cash savings for my Irvine home downpayment is in foreign currencies (Yuan, Euros, Swiss Franc, Canadian). It was different back in 1996. Though the OC real estate market was down, the dollar was very strong compare to the world market, and Chinese was still very poor. Now, the chinese currency is going up while the U.S. dollar is going down as fast as the OC real estate market. In 20 years from now, China may be 1st or 2nd in world economic power. Who knows China may be more powerful than the U.S in the near future. Scary, isn't it?
 
[quote author="IrvineRenter" date=1209970571]You should add a row for the median. The median on that spreadsheet is $623,750, and the median $/SF is $365/SF. Also interesting was the median loan was $417,000: the conforming limit.</blockquote>


Median added.
 
[quote author="emoh88" date=1209976663]57% average down payment, if true, suggests that there is a whole bunch of money (Asian?) on the sidelines ready to pounce on Irvine RE. Thank you IrvineRealtor for your analysis. This is very interesting!</blockquote>


The average isn't 57%, it's 36%... It would appear the median down payment percentage is 27%.



I've always said the old IPO family is just average in Irvine. We'd be looking to go 35-40% down as well.
 
This is good stuff. Thanks IR2! It looks like the foreign money is really investing in Irvine, just like they did in the 90s. Geez, I really hope it works out for them this time, and they don't get screwed like before. Eh, they are smart, and learned from the past, so they should be fine. I mean, it's not like Volcker is going to be appointed any time soon.



Anyway, it is late, er... for east coast time that is, so is there a way to see the unit #'s of the inferno of the units in Marquee/Michelson? Heh, I would like to keep up with some of these unfortunate "lifestyle" lovers. It seems the FBI doesn't agree with some of the "lifestyles" there.
 
IrvineRealtor's table is endlessly entertaining. Through April 10th buyers that put down less than 10% numbered about 40 compared to the 37 who put down 75%-100%. Another 37 put down 50%-74%, 90 put down 25%-49% and 80 put down 11-24% (mostly around 20%)... Median and averages don't mean much when the data isn't a bell shaped distribution. Fascinating!! Yep..there IS a bunch of money waiting to buy in Irvine.
 
There are folks with money waiting to buy. And they may wait much longer. They didn't get their money by being stupid.
 
Yep, I'm going to wait just a little longer and see if we can get back to 2001 prices. We will see though..... I may just spend a few extra dollars on some rentals.

good luck

-bix
 
IRealtor,



Great site!

Appreciate you organizing and posting the info.

In honor of the Jerry Maguire clip you posted,

?Show Me The Money!?

You delivered, mucho thanks!
 
before we begin to draw definite conclusions about the down payment %'s, we should think of explanations other than the Rich Chinese Theory. it would be irrational to simply accept the first and most commonly-cited reason as fact.



off the top of my head -- there could still be a significant number of move-up buyers. i think of my parents, for example. they missed the boat on the bubble but anyone like them who have been in their homes for at least 10 yrs are still sitting on a fair bit of equity. the current environment is just added incentive for boomers to make their one final move-up/down into their retirement homes. although its probably hard to come by, age of buyers would be a very interesting variable to know.



any other theories?



also another thought, the data suggest rich foreigners preventing housing prices from declining in irvine/newport is simply wrong. let's assume RCT is in fact the reason for all the great cash and down payment numbers. nevertheless, prices have declined and sales are slow. just ask any realtor or mortgage broker how business is doing. in other words, RCT is only true in the sense that those people exist, but like many here have argued, they have absolutely impact on changing the downward direction of prices.



the avg percent down on conforming loans is 44%. for non-conforming it's 22%. i thought that was interesting but those avgs are open to a lot of interpretation.



great stuff, IR2!
 
<strong>Some caveats to the numbers...</strong>



Important items to note:

-These are only the MLS listed sales in the time period referenced, and not ALL sales for Irvine.

-Many of the "new build" homes are direct sales from the builders and never hit the MLS, and therefore are not on the site.

-The lending numbers were pulled from an independent site, realist.com, representing actual title references. There are numerous methods available to keep the lending information private, but for the most part these are good data.

-Running into the end of April numbers, I was beginning to find that although the transactions had been "closed" on the MLS, the title reports have not been updated, yet. I will continue to update as they come in, but expect about a 3 week lag.

-Please recognize that this was only one person's entry with a substantial amount of manual entry. Anyone out there available to perform a secondary verification would greatly enhance the confidence in this data. That said, I think it's pretty solid.



I am not going to take the bait and say that these numbers mean X or Y continued depreciation, how long the market corrects, or anything else. I leave that to you to pontificate upon. My crystal ball is still on backorder.



<strong>Helpful observations - </strong>



The "rich buyer" theory may hold some water. From the names on title, well over 50% of the buyers bear Asian surnames. (But do not make the mistake of lumping them all together: Chinese, Vietnamese, Korean, and Japanese culturally are very different buyers with very different hot-points they are looking for in our market!) Also with a big presence were the middle-eastern buyers representing about 20% of the sales.



Only two buyers came in utilizing local low-income qualified financing.



Lending was still topped by Countrywide (surprisingly to me) with OCTFCU making a big splash, as well. There were many, many small lenders available, also, that were making loans of all sizes.



The City of Irvine picked up one relatively small property (financed with Countrywide). Any ideas why we needed that?



Lastly, we now have a very well-known professional basketball coach who has moved to the area!... ahhhhhh, the benefits of public information voyeurism.
 
What jumps out to me on IR2's spreadsheet is the sales volume. Average sales in Jan/Feb were 77. April was 137 units... Almost 80% more sales in April with the same inventory count essentially as on 12/31/07 means WAY less inventory.



In Irvine, we started the year out with 10-11 months inventory. In a few short months, that has been reduced to 6-7 months worth. The median DOM was down to 80 on the April sales whereas it was 115 on the Feb sales...



Unless/until the recent dynamics change, prices will start firming soon if they haven't already.
 
<blockquote>-The lending numbers were pulled from an independent site, realist.com, representing actual title references. There are numerous methods available to keep the lending information private . . . </blockquote>
How does one keep the lending numbers private?



I believe there is a way to keep the sold price off the public records as well, but I'm not sure how one would go about doing that.
 
[quote author="IrvineRealtor" date=1210034287]<strong>Some caveats to the numbers...</strong>



Lastly, we now have a very well-known professional basketball coach who has moved to the area!... ahhhhhh, the benefits of public information voyeurism.</blockquote>


Who? Phil Jackson?
 
i'm gonna take a devils advocate stance on the rich buyer theory.



rich buy theory involves two parts:

1) rich buyers exist

2) rich buyers maintain price premiums



there's evidence to suggest #1 is true. there's no evidence to suggest #2 is happening however.

it seems the counter-argument that rich buyers are not stupid and will gobble up trophy homes price be damned.



the % downpayments on conforming vs non-conforming loans is very telling imo. it shows that the cash-rich buyers are also the more conservative ones -- taking on more modest homes and mortgages. they are not just putting down 20% and buying more house even though they could afford to. in other words, the conservative are being extra conservative. not sure the implication of that, but just something interesting to note the profiles of buyers.

<blockquote>

<em>(i dropped all observations where down and loan data is not avail. also excluded the handful of >$2M sales)</em>

<strong>

Loans > $417000</strong>



Variable | Mean

-------------+--------------------------------------------------------

salesprice | 830269.7

downpmt | 205503.4

percentdown | .2205405



<strong>Loans <= $417000</strong>



Variable | Mean

-------------+--------------------------------------------------------

salesprice | 592880.7

downpmt | 305021

percentdown | .4379255



<strong>Loans <= $417000 </strong><em>(but also excluding 100% down payments, i.e. $0 loan)</em>



Variable | Mean

-------------+--------------------------------------------------------

salesprice | 561745

downpmt | 227685.5

percentdown | .347716





also, rich foreign buyers are not necessarily a good thing. a town full of wealthy foreigners who may or may not actually make their living here is not beneficial in the long-run. irvine needs diversified industries with good income-producing jobs, instead of pinning its hopes on replacing one bubble (housing) with another (asian/middle-east economies). look at japantown in LA, for example. it was a boomtown in the late 80s and now it's a ghost town.
 
[quote author="acpme" date=1210045267]

also, rich foreign buyers are not necessarily a good thing. a town full of wealthy foreigners who may or may not actually make their living here is not beneficial in the long-run. irvine needs diversified industries with good income-producing jobs, instead of pinning its hopes on replacing one bubble (housing) with another (asian/middle-east economies). look at japantown in LA, for example. it was a boomtown in the late 80s and now it's a ghost town.</blockquote>


Two words are all you need to know: San Marino
 
no offense but san marino is a terrible example. san marino is a tiny, almost entirely SFR-only town. you might compare it with specific high-end enclaves around here. villa park is actually pretty good comparison.



aside from a large population of asians, san marino completely unlike irvine, which is the major commercial, "urban" heart of OC. irvine has low income housing, rv parks, gigantic apt complexes, pink stucco boxes as far as the eye can see, and custom estates all rolled into one.
 
IR <<well over 50% of the buyers bear Asian surnames. (But do not make the mistake of lumping them all together: Chinese, Vietnamese, Korean, and Japanese culturally are very different buyers with very different hot-points they are looking for in our market!) Also with a big presence were the middle-eastern buyers representing about 20% of the sales. >>



VERY interesting! 70%...unreal.



Maybe the falling dollar is having a impact on drawing out foreign buyers. 2008 is different than 1996. Many Asians are now flush with cash and a comparable Shanghai house (land lease only) is more expensive than an Irvine house.
 
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