Villages of Columbus - Columbus Grove - Lantana

NEW -> Contingent Buyer Assistance Program
I think what rick was trying to communicate was that your offer of 600k wasn't very realistic based on CURRENT conditions. Qwerty, don't get too bearish, or you will never buy a home. This sentence was key for me: "So that was basically it. Even at 600K i probably would have been over paying by 50-100K but was willing to do so. " Trust me, at 600k, it would be sold in a few days. Are you telling me a brand new 2600 sqft single family home with driveway (ie, real SFH) in Irvine is worth only 500K - 550K right now? Plug it into a mortgage calculator and you get $2600 all in after tax deductions. I guarantee you, at that price, the hundreds of people living in a 2 bedroom apartment in irvine for 2000-2200 with be running over to Lantana to sign on the dotted line. Just to further put things into perspective, if you live there for 10-20 years, your mortgage payment stays FIXED. So in 20 years, you'll still be paying 2600 per month while rent(assuming 3% inflation) on a 2 bedroom apt will be approaching 4K. Good luck, but I think you need to reevaluate what's fair value on a house in Irvine at this moment. Do not look at prices in the late 90s or 2000 to determine what is fair value. Rates are much lower, and wages are much higher.
 
<p><em>"I guarantee you, at that price, the hundreds of people living in a 2 bedroom apartment in irvine for 2000-2200 with be running over to Lantana to sign on the dotted line."</em></p>

<p>rt- there may be 100's of people living in 2 bedroom apartments who might <em><strong>want </strong></em>to sign on the dotted line at this perceived low price, but do you really think there are 100's of 2 bedroom renters who actually have 120K to put down and salaries in excess of 150K that are now necessary for loan approval? The key difference in today's market is gaining access to the necessary mortgage capital that will allow a potential buyer to actually make this move.</p>
 
100's of people <strong><em>want </em></strong>a Porsche, not many can afford one. Last time I checked Porsche prices have gone up.
 
"Do not look at prices in the late 90s or 2000 to determine what is fair value. Rates are much lower, and wages are much higher."





Guru - i understand what you are saying, but why wouldnt i look at prices in the late 90s 2000, from all of IRs analysis it seems that when a bubble bursts the prices <strong>always</strong> come back down to rental equivalents, which i presume would probably put the value of a lantana plan 1 at or below 600K. Not sure what kind of rent a lantana home would command right now, but if it commanded 3,500/month that would put the value (using the 160 multiplier) at about 560K. $4,000/month would put it at 640K, so even at 732K it still seems over-priced.





It just seems like it would be foolish for me to buy a depreciating asset without factoring what it would be worth in a couple of years. If im wrong then so be it, I would have taken a gamble and lost. I figure the prices are only coming down in the next couple of years so it wont hurt to wait.
 
"Do not look at prices in the late 90s or 2000 to determine what is fair value. Rates are much lower, and wages are much higher."



Do we really have much lower jumbo low rate now (7%) compared with 2000? Also, I don't know what is your field? But in high tech industry i am in, starting salary increase is

no more than 20% compared with 2000. I don't see justification why house is 2.5 times as expensive as 2000.For me, I will be interested on lantana when the peak to bottom drop is 30% (the drop of last bubble bursting in 90~96), which puts plan 1 around 630k.
 
As a matter of fact, I do know 2 different couples that live in 2 bedroom apartments in irvine, make a combined income close to 200k that are just waiting for something that interests them. Lantana for 600k would most definitely interest them.



 
"100's of people want a Porsche, not many can afford one. Last time I checked Porsche prices have gone up."



And home prices have gone up also. Can you go to a Porsche dealership now and force them to lower their price to an amount that you think is fair? They might bend for a few thousand but not by much. Guru wrote my point in great detail and it follows with demand. At $600K, the demand would be tremendously HIGH for that property. The same concept would hold true for a Porsche.
 
A porsche is considered a luxury item and is priced as such so only higher income folks can afford it and maintain its elite status. I personally dont think a home should only be for higher income folks (it is not in most parts of the country), it also should not be for the financially irresponsible. Im just saying 732K is out of whack with historical prices.
 
Does the porsche price go up 3 times or stay the same during the past 10 years?!! My point is no fundamental change in Irvine in the past 10 years. I don't

see why one 4 bedroom SFH in northwood (Lexington model) went from 330K in 97 to 1.25M in 20006 (I remeber it is 26 wedgewood). That is just insane.
 
If banks start to require documentation and 20 % down payments you will have the house for $600,000 if you just wait.





As mentioned above there are a lot of people that rent that have the income but have not saved enough money for a down payment to mitigate the banks risk. As the projections of 10, 20 and even 30 % drops in home prices become accepted by lending institutions, they will require larger down payments. This will drive home prices even lower because it takes a long time for a couple making $200,000 per year to save $120,000.





The credit tightening is just starting. For many in the RE industry, it seems as though it cannot get any worse, but it can and it will. Bankers are, for the most part very conservative and will not lend money for homes if there is any risk of loss.





Qwerty,,,,,,,let me know if you want me to go in with a cash offer of 500K. If they sell it to me I'll let you have it for $600K.
 
Irvine is a "Porsche" compared to the rest of OC. OC in general is a "Porsche" compared to the rest of the socal. Socal is a "Porsche" compared to the rest of the country. America is a "Porsche" compared to the rest of the world. There are plenty of bigger and cheaper homes (Honda Civics) in the IE if you think Porsche is too expensive.
 
If someone offered me $40,000 for the Porsche and that was the most anybody would offer and I needed the money, yeah, I would take the $40,000. The sales agent may not take the offer last week, but he may next week, or the week after that, or ...<p>


If ya got the dough and the quals, what the heck have you got to lose by making dirt offers? It isn't like you are afraid to offend anybody. Ya may want to ask xsocal about this. He seems like he is experienced at hardball.
 
Thanks for the offer Nano - i may have to take you up on that





JP - I think some of us are forgetting about the ridiculous and irrational increase in home prices over the last 10 years as pointed out by TonyTony. I agree that probably a good amount of people would jump all over lantana at 600K right now, me included. But if they were such a good deal right now at 732K they would be sold out, give that they arent really moving them at 732K doesnt that mean that they could be over priced? Or as our RE agent friends like to point out, is the winter just slow time in general for purchasing homes?





This past weekend i was the demand part of the supply/demand equation and the demand was only willing to pay 600/650K, its only worth what people are willing to pay for it right?
 
jp, does comparison also take into consideration the fact that a porshe is over priced, over rated and a piece of junk that only posers drive?
 
of course you can make dirt cheap offers, but it's insane to EXPECT people to comply with them. the tone from some of the postings have these expectations and are calling it a conspiracy that the sellers are not making it known to their supervisors.



if lantana's are posted at 600K and you have people bidding it up, that final price would be the demand and i'm pretty sure it's not going to be 600K.
 
lantana will probably sell out before it hits to the low 600s but it's going to have a ways to fall. Just look at the history for the homes similiar to these homes that are like 3-5 years old. The prices are in the 300s and 400s. Take the fact mello roos and hoa are lower too and the houses are ridiculously expensive. If you look at it from a numbers stand point..say they offer it to you for 600 k. how many people will have 120k as a down and make like 110k a year to qualify for that loan? That's top 10% if not higher. These homes are nice but I don't think I would consider them top 10%.
 
"say they offer it to you for 600 k. how many people will have 120k as a down and make like 110k a year to qualify"



That is kind of underestimate. I went through builder website to do preapproval. For a 650K house, I put down 130K downpayment. Also I filled in 12,000 annual property tax+1,000 annual insurance,(which is definetely an underestimate considering Mello Ross+HOA+propertyTax), then their calculator told me that the MINIMUM income requrement is above 170,000, which is in line with the classical rule of thumb: 3~4 times of your income is your house price you can afford. Though I think I won't pay more than 650K for a property like Lantana, I do think someone will grab it before it falls to 650K, just like the current Lantana residents who paid happily 1.1M for plan 3 less than one year ago (LOL, they even went to protest later for price drop!)
 
<p>"the tone from some of the postings have these expectations and are calling it a conspiracy that the sellers are not making it known to their supervisors."</p>

<p>RH - I don't think people are expecting that the builder will accept these prices at all. The point regarding the supervisor vs. the sales rep is that it <strong><u>may</u></strong> increase the chance of it being accepted. At the least, you lose nothing by trying and the upside is that you cut out the middleman sales rep. </p>

<p>Also, the tipping point is all over the map for people on this board. Some have said Lantana at $600K while some have said $650K and others are saying it will fall even further than that. I think its good for all of us that people on this board who have a price in mind are at least willing to go try to offer it and report back. That kind of knowledge will be immense for all of us as there are still a bunch of properties being built in Irvine/OC and we can all use the same strategies.</p>

<p>The fact is that because of qwerty trying, we now know Lantana plan 1 can be had for $720K or slightly more which just might be a tipping point for someone on this board! </p>
 
<i>"RH - I don't think people are expecting that the builder will accept these prices at all. The point regarding the supervisor vs. the sales rep is that it may increase the chance of it being accepted. At the least, you lose nothing by trying and the upside is that you cut out the middleman sales rep."</i><p>


Exactly. What have you got to lose? Is something bad going to happen if you go straight to the decision maker? Does it lessen your chances of getting what you want? It isn't personal. Why not do the best for yourself that you can? Unless you get your feelings hurt when the builder says no, I see no downside to lowballing the snot out of the offer.
 
<p>i thought we have a problem with people putting their homes up for sale with unrealistic selling prices? we tell sellers that if they are serious about selling, they have to lower their prices to meet the demand.</p>

<p>now we jump on the opposite band wagon and start asking for unrealistic buying prices (AT THIS MOMENT IN TIME). if you are serious about buying, you make a compromise and buy it at the current demand level price, whatever that is. at 720K, you would have done everybody here a favor and you would have bought this home at a record low? then the next buyer would have something to work with. but until a sale at the lower price is recorded, it dont mean a thing! bears can drink from the kool-aid bottle too.</p>
 
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