Should I Do It? VOC - Ciara

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gasjockey_IHB

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I have been reading this forum for quite some time and it seems the general sentiment is that prices will continue to drop. I like a home in VOC - Ciara (William Lyons) that is about 4200 sq ft. They are asking around $1.3m for it. It was priced over $1.4 about 6 months ago. There are only 2 of these models left and no new construction in the area planned that compare in the near future. Do you think its a good time to buy if I can get if for about $275 / sqft? About $1.2m? Or do you think I should hold on for a while longer and risk losing a shot at one of these last two models?



Thanks for your input.
 
You might want to consider waiting a while - 2-3 years. When a resale of this model pops up (and it will) you could get a real bargain when you factor in the first owner has completed the landscaping, window coverings, upgrades, etc. These things really add up. Of course, this it dependent on your willingness to buy a "gently used" home.
 
<p>My two cents... If you like Ciara and can afford to wait for a while, do it. Even if they sell out, I'm quite sure you'll find them popping up resale before too long. Probably distressed as well.</p>

<p>The Ciara Plan 2 is an awesome house in my opinion. Sucks that its in VoC though.</p>
 
if you love the home buy it. this specific home in that very location. if you just like the floorplan and don't care about the exact loaction, wait.
 
Exactly what flmgrip said. If you have to have a specific location, this is your dream home you plan to live in for a long time and you can afford it, I'd go for it. Some people place alot of value in being able to customize a brand new home to their tastes. Others don't care care as much. Which one are you?



Ciara plan 2 was my favorite before I bought elsewhere, but they just wouldn't come down enough to be competitive with other builders.



I also have a friend who would buy at 1.2 for one corner lot he absolutely loved. However, they haven't come down to his price, so he's probably going to end up staying put. He's a moveup buyer with 500K equity.
 
A $1.2 million dollar home will experience a monthly equity burn of about $10,000 a month for the next 2 years. If you don't mind watching $240,000 of property value, and thereby your equity, vanish over the next 2 years, go for it. It's not like you will need to wait 10 years for values to come back... no, wait, you actually will have to wait that long or longer. I would go to Vegas and put $240,000 on black. If it comes up black, you have $240,000 of free money to burn, and you should buy the house. If it comes up red, you are not worse off than buying the house, and at least you don't have to endure two years of waiting to lose your $240,000.
 
gasjockey



You didn't note if you have read this blog for a while and decided to post or are you new to reading it? If you are new then I will introduce myself as one of the IHBs Resident Bears.



If it is a model you are paying a premimun for the location, builtins, and upgraded landscaping. Is the home really so unique that there will not be a replacement location, floorplan, elevation available as a resale in the future? I am not sure that there are really "unique locations" in Irvine production housing as when compared to ocean views, large lots, ect.



My feeling is that a short sale or REO in the same general area with the same square footage within the next 12 months wouldn't be a better way to go.



As rtlgru said- if it is your dream home in a perfect location and within your financial comfort zone then go for it, but you can probably make a better deal if you shop for a while.



How long ago were the first phase homes sold? Did you check for NOD's on any of them?



I am not saying that this is a bad time to buy but buying a model from a builder may not be the best deal out there.



Good luck!
 
<p class="MsoNormal">gasjockey... you can't be too surprised by the responses that you got since 85% of the people on this board are bears. The bottom line is if you really like the specific model and the area, and don't plan on moving for a while, then by all means go for it!!


</p>
 
<p>Find out what properties sold for around $1.2milion in 2004 in that area. Try to find something comparable to what you intend to buy. The point is, you should not be paying 06 or 05 prices. You should pay the 2004 price to hedge against any further price drop. Any realtor should be able to help you what past comps.</p>
 
Just remember, this is a bear board. That doesn't mean they don't have a point. they are giving you the right advise from PURE financial standpoint of view. However, just remember there is also a emotional side of buying a house. It is little similar to having kids - great joy, but financially challenging from time to time. IMO, buying a house is not a pure business decision, in other words NPV is NOT the only deciding factor here .



My advise to you are as follows:



a. make sure you absolutely love the house after extensive research.

b. make sure you absolutely can afford the house

c. make sure you that you are planning to stay there for at least five to seven years if not more - considering your job situation, etc. For example: if you or your spouse wants to get a promotion, do you have to move out of the area? If you are a self employed doctor, or dentist with a practice in OC, then this is not an issue.

d. make sure you do your search on comps. You want to be lower than the lowest comps just to make sure you give yourself a bit room from the market to come down.

e. Discuss with wife or husband about how you guys feel about renting a house. For someone one like me, renting just not a thing I want to. In the current market, renting a house is not bad thing to do. There is no right or wrong answer. It is a personal choice and you don't let anyone to influence your thinking. Only you know how you want to live.



For most of the irvine community, I think you are safe to consider the above five issues. However, for VOC, I will add the following: the builder has proven to be very willing to cut prices. The market has been "trashed" by the builders pricing cutting. It might be good for the buyers, but once you become a homeowner there, that is not what you want to see. I think you will experience more price instability there than any other Irvine community.
 
<p>There are some credit problems coming through the world financial markets which are going to make IR's prediction of $10,000 loss per month look like the sentiments of a eternal optimist.</p>

<p>Good luck.</p>
 
Credit problems? What credit problems? Oh... you mean those problems, the problems that are spreading, and how they are not contained. <a href="http://online.wsj.com/article/SB120269228578457765.html">Yeah... these credit problems</a>.
 
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