The recession is coming

[dream16]

@dream16:

If your job situation is stable and as you said, you are looking at 10 years to stay where you are, you'll be okay.

As a first time home buyer, I understand your jitters, you have to put much more in than others (esp in Irvine) but being that it is in Irvine, your "value" is safer than most.

Congrats and try to enjoy your home.

Thanks Irvinehomeowner, even if i don't get to live in it due to moving for a better job, i would rent it out and take the inital 10k/year negative hit as cost expenses for the condo till the IR rent soars upto $3200-$3300/month for a 2 bedroom in PS and then i will have it break-even (my PITI) per month. Perhaps, this is all long-term and eventually should make sense.

 

[dream16]

If you already bought what difference does it make?

Houses aren't liquid. You can't just decide to sell today and get your money tomorrow.

You still have to have a place to live. It makes no sense to sell what you just bought hoping to get lower prices. The cost to sell is not cheap.

Who said i am selling? I am going through some nervous initial jitters as my 110k down got wiped off my accounts as it's my 1st purchase. Selling is atleast 35k expense, i am not selling it unless i see it swell to 700k in next 5 years, so i can atleast make 100k on it...lol hopes !!! Hopes...is what keeps us alive

Change of heart? Buyers Remorse?

Not really eyephone, if you put yourself in my shoes, since last Aug 2015, i walked every block of Southern CA to search for an ideal investment+ livable SFR (Condo was not even something i wanted) with a max budget of 550k, i pulled out of a dangerous mistake on the 16th day of buying a SFR in SantaClarita (nobody rents there, the town didn't have a nice vibe, too lower middle class, plumber-fixer-labor kinda population) & then decided that i cannot compromise on:

1. Schools (although have no kids and neither plan on having them in next 2 years)
2. Rentability (city must have atleast 50% renters)
3. Crime Rate
4. Proximity to beaches
5. International Interest Area
6. Media Hype - Awards and Stuff
7. Asian+White Population

Other than IR, i had my eyes on Aliso Veijo for a while, where a friend bought 440k 1300 sq ft condo in 2014 (built 1991), but it was buried too far away for my liking and also the rents are low in there.

After all my math, i landed at one and only IR - i hope my long rant here helps someone make a similar decision as i meet a lot of frustrated souls with 780 credit score, 110k cash in bank, no crime records, clean history, stable jobs (100k/year) and STILL NOT able to BUY a home !

 

[dream16]

Have to adjust timeline a bit. Closed January Sales are for contracts in November/December. The number of homes going under contract does slow during these months, which translates into lower closings in Jan/Feb.

Yes, to the topic headline, I believe there is enough data to show a recession is coming. I learned however some time ago that when you want to go down stream safely, you row a bit from the right and a bit from the left....

http://www.calculatedriskblog.com/2016/01/update-predicting-next-recession.html

Hedge accordingly.

My .02c

SGIP

If a recession does come, do you see newly built IR 2 bedroom condos dropping 20-30% from their current price? Example a attached condo sold for 550k now will be sold for 165k less =  385k?

Did such a drop happen in 2012-2013? Please share thoughts, i have been told by numerous realtors that IR market is insulated from recession due to international interests, cash buyers, safest city, award winning, best schools in USA etc.

Anything can happen. You should of thought of this before you bought your high rise tower. (Joking)

I know...but i was mislead saying IR market is insulated from recessions, either-ways, i hope i haven't bought at the very peak, is there a graph that can clearly show how the IR condo prices have increased from 2012-2015? I don't want to know the horrendous single family home stories as million dollars isn't the market i am playing in at the moment and they might have had way more serious fluctuations in last 3 years

One of the resident realtors on TI can correct me if I am wrong, but I think historically, condo prices are more volatile than single family houses in times of boom and bust. Some of that may be due to investors swooping in and out.

Just curious have you read feedback about your builder? If not you should have, which I think is a game changer. I'm not going to mention any names.

Lol, i came across this:http://www.kbhomesleak.com/--> not sure if they can manage to do the same kind of construction in Irvine as what i heard from their Super-intendent - the guy who does your final walk through - we need to get 70 signatures from city of IR before our construction is approved.

 

[Bullsback]

Fairly certain all builders have plenty of terrible feedback. Toll Brothers has awful feedback as do others. Reality is all of the work is subcontracted and outside of customer service and plans, most all the same people are doing stuff. I'm sure there are slight differences due to overall quality control put on top, but I think the whole builder name is a lot of overplay in most cases (but whatever floats people's boats). 

 

[Ready2Downsize]

If you already bought what difference does it make?

Houses aren't liquid. You can't just decide to sell today and get your money tomorrow.

You still have to have a place to live. It makes no sense to sell what you just bought hoping to get lower prices. The cost to sell is not cheap.

Who said i am selling? I am going through some nervous initial jitters as my 110k down got wiped off my accounts as it's my 1st purchase. Selling is atleast 35k expense, i am not selling it unless i see it swell to 700k in next 5 years, so i can atleast make 100k on it...lol hopes !!! Hopes...is what keeps us alive

Change of heart? Buyers Remorse?

Not really eyephone, if you put yourself in my shoes, since last Aug 2015, i walked every block of Southern CA to search for an ideal investment+ livable SFR (Condo was not even something i wanted) with a max budget of 550k, i pulled out of a dangerous mistake on the 16th day of buying a SFR in SantaClarita (nobody rents there, the town didn't have a nice vibe, too lower middle class, plumber-fixer-labor kinda population) & then decided that i cannot compromise on:

1. Schools (although have no kids and neither plan on having them in next 2 years)
2. Rentability (city must have atleast 50% renters)
3. Crime Rate
4. Proximity to beaches
5. International Interest Area
6. Media Hype - Awards and Stuff
7. Asian+White Population

Other than IR, i had my eyes on Aliso Veijo for a while, where a friend bought 440k 1300 sq ft condo in 2014 (built 1991), but it was buried too far away for my liking and also the rents are low in there.

After all my math, i landed at one and only IR - i hope my long rant here helps someone make a similar decision as i meet a lot of frustrated souls with 780 credit score, 110k cash in bank, no crime records, clean history, stable jobs (100k/year) and STILL NOT able to BUY a home !

Affordability is why Irvine has to have FCBs to hold up values imo.

Why do you want at least 50% renters?

 

[dream16]

If you already bought what difference does it make?

Houses aren't liquid. You can't just decide to sell today and get your money tomorrow.

You still have to have a place to live. It makes no sense to sell what you just bought hoping to get lower prices. The cost to sell is not cheap.

Who said i am selling? I am going through some nervous initial jitters as my 110k down got wiped off my accounts as it's my 1st purchase. Selling is atleast 35k expense, i am not selling it unless i see it swell to 700k in next 5 years, so i can atleast make 100k on it...lol hopes !!! Hopes...is what keeps us alive

Change of heart? Buyers Remorse?

Not really eyephone, if you put yourself in my shoes, since last Aug 2015, i walked every block of Southern CA to search for an ideal investment+ livable SFR (Condo was not even something i wanted) with a max budget of 550k, i pulled out of a dangerous mistake on the 16th day of buying a SFR in SantaClarita (nobody rents there, the town didn't have a nice vibe, too lower middle class, plumber-fixer-labor kinda population) & then decided that i cannot compromise on:

1. Schools (although have no kids and neither plan on having them in next 2 years)
2. Rentability (city must have atleast 50% renters)
3. Crime Rate
4. Proximity to beaches
5. International Interest Area
6. Media Hype - Awards and Stuff
7. Asian+White Population

Other than IR, i had my eyes on Aliso Veijo for a while, where a friend bought 440k 1300 sq ft condo in 2014 (built 1991), but it was buried too far away for my liking and also the rents are low in there.

After all my math, i landed at one and only IR - i hope my long rant here helps someone make a similar decision as i meet a lot of frustrated souls with 780 credit score, 110k cash in bank, no crime records, clean history, stable jobs (100k/year) and STILL NOT able to BUY a home !

Affordability is why Irvine has to have FCBs to hold up values imo.

Why do you want at least 50% renters?

I worked with a property management company to get the last 5 year data of IR rentals for 2 bedrooms and found that during an entire 12 month period, the average time it takes to rent out a condo in IR is 25 days , unless you ask for an obnoxious price at the wrong time of the year, so this gives me the flexibility to do big career advancements, take risks and not just stick around living in IR at 1 job as i can rent it whenever i want to.

 

[The Motor Court Company]

4 story attached condo from KB ? double ouch....
aberrations like Willow can only sell at the height of a housing bubble when people have not much choice, and usually crashes the hardest in bad times.

and then the KB "quality" come resale when the warranty expires...

 

[dream16]

4 story attached condo from KB ? double ouch....
aberrations like Willow can only sell at the height of a housing bubble when people have not much choice, and usually crashes the hardest in bad times.

and then the KB "quality" come resale when the warranty expires...

Lol, i better sneak out after 5 years ...if those 4 had to collapse on me & yes at 550k, there isn't any choice at all in IR, so your point is spot on, quality and builder well..there's a whole rant about all of them pretty much using contractors/warranty being just a fluke/cheap materials = maximize their own profits, gone are the early 90's when actual focus used to be building good homes.

Now if you have a granite + a backsplash is worth more to naive customers than a solid built house w/o these items..capitalism and ignorance at its best

 

[zubs]

I live in a house built in 1990.  When you get close to the windows, it feels like a refrigerator.  Single pane windows put in by Standard Pacific.  Is it because Stanpac is a shitty builder? or is window tech much better now with double and triple pane glass?

 

[Ready2Downsize]

Never had any problems with my Stan Pac house that I owned for 17.5 years.

It's your windows.

 

[eyephone]

4 story attached condo from KB ? double ouch....
aberrations like Willow can only sell at the height of a housing bubble when people have not much choice, and usually crashes the hardest in bad times.

and then the KB "quality" come resale when the warranty expires...

Lol, i better sneak out after 5 years ...if those 4 had to collapse on me & yes at 550k, there isn't any choice at all in IR, so your point is spot on, quality and builder well..there's a whole rant about all of them pretty much using contractors/warranty being just a fluke/cheap materials = maximize their own profits, gone are the early 90's when actual focus used to be building good homes.

Now if you have a granite + a backsplash is worth more to naive customers than a solid built house w/o these items..capitalism and ignorance at its best

Since your going to rent it out. You should consider the following:
1. Are you going to list he property yourself or are you going to use an agent/service?
2. Will you manage the property your self or use a property management company?
3. Will you get landlord insurance?
4. Will you allow pets?

Post rental for free. (Supposingly it's then advertised at the other major sites)https://www.rentlinx.com/post-rental

 

[zubs]

Never had any problems with my Stan Pac house that I owned for 17.5 years.

It's your windows.

This just proves that a celebrated builder like Standard Pacific may do shitty builds & a infamous builder like KB homes may do a good job.

The windows were put in 25 years ago.  I was thinking of changing them out soon.

 

[irvinehomeowner]

All older homes have bad windows, regardless of builder.

It's the one of the things we looked at when we were touring resales, to see if they replaced the windows.

 

[lnc]

I live in a house built in 1990.  When you get close to the windows, it feels like a refrigerator.  Single pane windows put in by Standard Pacific.  Is it because Stanpac is a shitty builder? or is window tech much better now with double and triple pane glass?

It's the single pane window.  The double pane window are far superior than those single pane one.

My previous house with single pane window was also built in the 90's and I know what you are talking about.  There's no temperature and no sound insulation from these windows.  When we finally replace them with Milgard's double pane replacement windows, it make a wold of differences in sound insulation and our heating/cooling bills. 

 

[dream16]

I live in a house built in 1990.  When you get close to the windows, it feels like a refrigerator.  Single pane windows put in by Standard Pacific.  Is it because Stanpac is a shitty builder? or is window tech much better now with double and triple pane glass?

It's the single pane window.  The double pane window are far superior than those single pane one.

My previous house with single pane window was also built in the 90's and I know what you are talking about.  There's no temperature and no sound insulation from these windows.  When we finally replace them with Milgard's double pane replacement windows, it make a wold of differences in sound insulation and our heating/cooling bills.

Good points, everywhere in my condo (2015 built) is single pane...so practically its going to suck

 

[dream16]

4 story attached condo from KB ? double ouch....
aberrations like Willow can only sell at the height of a housing bubble when people have not much choice, and usually crashes the hardest in bad times.

and then the KB "quality" come resale when the warranty expires...

Lol, i better sneak out after 5 years ...if those 4 had to collapse on me & yes at 550k, there isn't any choice at all in IR, so your point is spot on, quality and builder well..there's a whole rant about all of them pretty much using contractors/warranty being just a fluke/cheap materials = maximize their own profits, gone are the early 90's when actual focus used to be building good homes.

Now if you have a granite + a backsplash is worth more to naive customers than a solid built house w/o these items..capitalism and ignorance at its best

Since your going to rent it out. You should consider the following:
1. Are you going to list he property yourself or are you going to use an agent/service?
2. Will you manage the property your self or use a property management company?
3. Will you get landlord insurance?
4. Will you allow pets?

Post rental for free. (Supposingly it's then advertised at the other major sites)https://www.rentlinx.com/post-rental

Thanks eyephone,
1. Probably will try my own luck 1st
2. Not sure how to manage my property from lets say san francisco
3. How much does landlord insurance costs per year? Which one is the best?
4. Pets: Umm i think no, since they will create issues on upgraded carpets.

Bigger Q: will the lender be able to find out that the buyer who bought the property as a primary residence has now rented it out? The reason i ask is coz i heard investment properties are applied a higher interest rate.

 

[Ready2Downsize]

When is your house closing?

 

[Bullsback]

I live in a house built in 1990.  When you get close to the windows, it feels like a refrigerator.  Single pane windows put in by Standard Pacific.  Is it because Stanpac is a shitty builder? or is window tech much better now with double and triple pane glass?

It's the single pane window.  The double pane window are far superior than those single pane one.

My previous house with single pane window was also built in the 90's and I know what you are talking about.  There's no temperature and no sound insulation from these windows.  When we finally replace them with Milgard's double pane replacement windows, it make a wold of differences in sound insulation and our heating/cooling bills.

Good points, everywhere in my condo (2015 built) is single pane...so practically its going to suck

Huh...I can't imagine any new build is single pane. 

 

[eyephone]

I live in a house built in 1990.  When you get close to the windows, it feels like a refrigerator.  Single pane windows put in by Standard Pacific.  Is it because Stanpac is a shitty builder? or is window tech much better now with double and triple pane glass?

It's the single pane window.  The double pane window are far superior than those single pane one.

My previous house with single pane window was also built in the 90's and I know what you are talking about.  There's no temperature and no sound insulation from these windows.  When we finally replace them with Milgard's double pane replacement windows, it make a wold of differences in sound insulation and our heating/cooling bills.

Good points, everywhere in my condo (2015 built) is single pane...so practically its going to suck

Are you sure it's single pane?

 

[AW]

^ditto
Single pane used to be the norm many years ago, and double panes are used for noisier places, now it's the norm, at least from what I've seen.