New homes in Portola Springs

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junior74_IHB

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I'm new to this forum and find a lot of the information you guys give informative and helpful. I'm in the market to buy a new home and am wondering what the general consensus is regarding homes in Portola Springs. I know the tax rate is outrageous, but at what point is the price low enough to off-set the taxes? Right now the Paloma plan 4 is set at 785,000, which is 310 per sq. foot. How low would they have to go to make it worth your while?



I was also looking at Manzanita as well, but their plan 2 is listed at 809,000 which puts it at $320 per sq. foot.



I'm also looking at homes at Northwood II and Woodbury because this is the area I'd like to stay in as I have 2 young ones, one of which goes to Woodbury Elementary.



Your opinions are greatly appreciated.
 
Welcome to the boards! Don?t forget about the sucker-punch with the rising HOA dues. I?m not trying to sound sarcastic at all, but it?s probably one of those things where if you have to ask, you can?t afford it. I?m one of just a couple people on here who actually live in P.S. Overall, I?d say I?ve become slightly disenchanted with it. I also have two little ones? one is school-aged? so I can tell you you?re school of residency would be Stonegate which has an estimated completion date of a year and a half from now. Until then, it?s a drive out to Westwood Basics Plus. Hope this helps.
 
On the main blog, there is a tab called "<a href="http://www.irvinehousingblog.com/calculator/">Calculator</a>." With it, you can accurately determine the cost of ownership of the property. Even at #310/SF, the cost of ownership is going to greatly exceed the cost of rental on a similar unit. When these get down to about $225-250SF, they might be reasonable.
 
[quote author="IrvineRenter" date=1225777079]On the main blog, there is a tab called "<a href="http://www.irvinehousingblog.com/calculator/">Calculator</a>." With it, you can accurately determine the cost of ownership of the property. Even at #310/SF, the cost of ownership is going to greatly exceed the cost of rental on a similar unit. When these get down to about $225-250SF, they might be reasonable.</blockquote>


Even if you don't want to wait 3 years, next April, prices should already be 10%-15% less than today, which would be in the $250-$270 range. You should still expect to lose some value, but at least it won't be as bad as if you purchased today.
 
Be ready to pay the HOA and Mello Ross - they add up to almost 1000 bucks a month..if you can throw that money down the pipe line to keep your lawn clean and green...go ahead ..enjoy..
 
Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toliet every year.
 
[quote author="PANDA" date=1225949593]Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toliet every year.</blockquote>


None.
 
[quote author="no_vaseline" date=1225949802][quote author="PANDA" date=1225949593]Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toliet every year.</blockquote>


None.</blockquote>


Why? Has there never been a precedence where this has ever happened before in Irvine?
 
[quote author="PANDA" date=1225949593]Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toilet every year.</blockquote>


It will never happen if anything the HOA will go up. The only thing that will help and you can watch as prices continue to fall if the Irvine company allows it. I would look at a used foothill ranch home and save yourself a lot of money...
 
At what point do "new homes" in Portola Springs, or anywhere else for that matter, start to become less desirable as they sit on the market and are no longer "new". While they may not have been lived in, they are no longer "that year's model" and even things like granite counters go out of style. Kwim?? I think waiting could hurt them.
 
I spoke to a Taylor Morrison rep recently about Taylor Morrison's taking over three streets of lots from Pardee's defunct Prado development. The TM rep said the main reason Pardee pulled out is because TIC refused to grant Pardee's request to lower prices. I predict that at some time in the future TIC will have to cut prices as the market deteriorates but they seem to be firm enough now to cause a major builder to walk away. Of course, you can always look for resale homes and avoid the TIC cartel.
 
[quote author="PANDA" date=1225951071]



Why? Has there never been a precedence where this has ever happened before in Irvine?</blockquote>


The HOA has to have a certain revenue to keep up the common and uncommon infrastructure. They aren't going to rip out the medians and let the grass die. Ergo, it can't go down.



The Mello-Roos are a special taxation district set up before ground is broken to pay for infrastructure. The infrastructure is paid for up front via bonds, and paid back by Mello-Roos. Ergo, it can't go down.



<a href="http://en.wikipedia.org/wiki/Mello-Roos">http://en.wikipedia.org/wiki/Mello-Roos</a>



Again:



[quote author="no_vaseline" date=1225949802][quote author="PANDA" date=1225949593]Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toliet every year.</blockquote>


<span style="color: red;"><span style="font-size: 13px;">None</span></span>.</blockquote>
 
[quote author="PANDA" date=1225951071][quote author="no_vaseline" date=1225949802][quote author="PANDA" date=1225949593]Is there any chance that Portola Springs may lower their HOA and Mello Roos in order attract more buyers. I agree, it like throwing $12,000 down the toliet every year.</blockquote>


None.</blockquote>


Why? Has there never been a precedence where this has ever happened before in Irvine?</blockquote>


It will not happen because it would require the Irvine Company to pay off the bonds. The bond money they received from the CFD was pure profit to them. There is little or no chance of them giving this money back. They would be better off lowering land prices, but they have been reluctant to do that either.
 
[quote author="High Gravity" date=1225954801]I spoke to a Taylor Morrison rep recently about Taylor Morrison's taking over three streets of lots from Pardee's defunct Prado development. The TM rep said the main reason Pardee pulled out is because TIC refused to grant Pardee's request to lower prices. I predict that at some time in the future TIC will have to cut prices as the market deteriorates but they seem to be firm enough now to cause a major builder to walk away. Of course, you can always look for resale homes and avoid the TIC cartel.</blockquote>


I have hard believing the TIC can fix the price that builders can unload their inventory for. I mean it is like manufacturing a product in China, and they are dictating to me what price I need sell the product to my end consumer. I would walk away and show them the bird. I had similar situation when i visited San Carlos. The Sales lady showed me some under the table prices and told me that TIC would slap their wrists if these prices were publically advertised. It seems that TIC is slowly drying the builders' blood. What happens when the builders run out of money to cover their overhead costs because TIC will not allow them to reduce their prices to move inventory?
 
[quote author="PANDA" date=1225961883]I had similar situation when i visited San Carlos. The Sales lady showed me some under the table prices and told me that TIC would slap their wrists if these prices were publically advertised.</blockquote>
I would bet she was just saying that.



TIC does have control over pricing... that's what builders have to abide by to get the "privilege" of selling in a "hot" market like Irvine.



FWIW:



We once lowballed a home in Woodbury and they took about 5 days to get back to us (something about having to consult with TIC which could or could not be true). We did the same thing at Columbus Grove (not TIC controlled) and they got back to us the next morning.
 
[quote author="irvine_home_owner" date=1225964348][quote author="PANDA" date=1225961883]I had similar situation when i visited San Carlos. The Sales lady showed me some under the table prices and told me that TIC would slap their wrists if these prices were publically advertised.</blockquote>
I would bet she was just saying that.



TIC does have control over pricing... that's what builders have to abide by to get the "privilege" of selling in a "hot" market like Irvine.



FWIW:



We once lowballed a home in Woodbury and they took about 5 days to get back to us (something about having to consult with TIC which could or could not be true). We did the same thing at Columbus Grove (not TIC controlled) and they got back to us the next morning.</blockquote>


Were either of those offers countered? What happened next?
 
[quote author="SoCal78" date=1225964438][quote author="irvine_home_owner" date=1225964348][quote author="PANDA" date=1225961883]I had similar situation when i visited San Carlos. The Sales lady showed me some under the table prices and told me that TIC would slap their wrists if these prices were publically advertised.</blockquote>
I would bet she was just saying that.



TIC does have control over pricing... that's what builders have to abide by to get the "privilege" of selling in a "hot" market like Irvine.



FWIW:



We once lowballed a home in Woodbury and they took about 5 days to get back to us (something about having to consult with TIC which could or could not be true). We did the same thing at Columbus Grove (not TIC controlled) and they got back to us the next morning.</blockquote>


Were either of those offers countered? What happened next?</blockquote>
Woodbury accepted. We offered about $100k less than their list price which was already "discounted" $100k and to include another $xxk in Design/Loan help (I forgot the amount but it was close to another $100k). After a week... we decided not to go with it because the location was just not right.



CoG, they countered with a slightly higher price. We actually went under contract but were unable to secure financing with either their lender or BofA (who had previously pre-approved us). I think their issue was the fact we own rental property and were planning to rent out our current home instead of sell it. Thankfully... they let us out. Frankly... we had our doubts due to all the scary documents we had to sign regarding the base land etc etc.



We consider ourselves pretty lucky because after reading this board, we've come to the realization that we would have overextended ourselves for homes that weren't in ideal areas (for us). We haven't looked to buy a home since.
 
[quote author="irvine_home_owner" date=1225977874][quote author="SoCal78" date=1225964438][quote author="irvine_home_owner" date=1225964348][quote author="PANDA" date=1225961883]I had similar situation when i visited San Carlos. The Sales lady showed me some under the table prices and told me that TIC would slap their wrists if these prices were publically advertised.</blockquote>
I would bet she was just saying that.



TIC does have control over pricing... that's what builders have to abide by to get the "privilege" of selling in a "hot" market like Irvine.



FWIW:



We once lowballed a home in Woodbury and they took about 5 days to get back to us (something about having to consult with TIC which could or could not be true). We did the same thing at Columbus Grove (not TIC controlled) and they got back to us the next morning.</blockquote>


Were either of those offers countered? What happened next?</blockquote>
Woodbury accepted. We offered about $100k less than their list price which was already "discounted" $100k and to include another $xxk in Design/Loan help (I forgot the amount but it was close to another $100k). After a week... we decided not to go with it because the location was just not right.



CoG, they countered with a slightly higher price. We actually went under contract but were unable to secure financing with either their lender or BofA (who had previously pre-approved us). I think their issue was the fact we own rental property and were planning to rent out our current home instead of sell it. Thankfully... they let us out. Frankly... we had our doubts due to all the scary documents we had to sign regarding the base land etc etc.



We consider ourselves pretty lucky because after reading this board, we've come to the realization that we would have overextended ourselves for homes that weren't in ideal areas (for us). We haven't looked to buy a home since.</blockquote>


I had no idea you can put in low ball offers for new construction in Woodbury. I am assuming these tracts are $1M plus homes like Mills Fleur, Juliet's B., and Villa Rosa? If TIC continues to control the builders' pricing on new construction, it seems like next best strategy is target resales home in Quail Hills, Woodbury and Northwood II as these buyers bought at the peak of the market in '04, '05, and '06, and over leveraged themselves. I am pretty sure that all these shadow inventories are going to popup all at once like popcorn in '09 and '10. I used to a big fan of Portola Spings, but after seeing how ridiculous their HOA and Mello Roos Taxes are, I am now concentrating my search efforts in resale in QH, Northwood II, and Woodbury.
 
You can usually make offers on houses that are in previous phases that fell out of escrow... especially ones that already had most of the design choices made since you can basically get those thrown in (but you have to take whatever they have).



This was last year and early this year so the down cycle was already happening and the builders were willing to make deals. I believe that new homes sold in Woodbury last year were lower than the first few phases prior to 2006.
 
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