When would be next housing Bottom?
- Thread starter OCLuvr
- Start date
NEW -> Contingent Buyer Assistance Program
NO ECONOMIC RECESSION
But there will be market consolidation around where we are - probably a dip in the summer ? which will get bought
So if ppl waiting for a actual recession to buy a house , you may be waiting for a long long time .
Buying a house may still not make financial sense for many - but THATS a different decision. I am talking specifically about use of recession as a catalyst to buy.
My point was, even without a recession, you can still have a major housing downturn in the 1.5+ market if the FCB dry up. Even in a booming economy, salaries in OC aren't going to support the glut of huge expensive houses we have.
What % of the Irvine market is supported by *Chinese* FCBs?
I just think there is a wide variety of buyers for Irvine beyond just that one demographic.
I myself had this misconception that FCBs were biggest proportion of high end buyers till I talked to actual people doing the buying
It is diverse mix - doctors from hoag, small business owners that CV mentioned , tech people , mgmt consultants , finance types
?In Southern California and primarily, Orange County and even more significantly Irvine, the foreign buyer and principally, the Chinese foreign buyer, first and second generations, made up 75 percent to 80 percent of the marketplace,? Larry Webb, CEO of New Home Co., recently told investors. ?And certainly, in the second half of last year, that buyer group was reduced significantly.?
https://www.ocregister.com/2019/03/...tion-10-as-luxury-market-chinese-buyers-fade/
But hey, maybe IHO and fortune11 know more than Larry Webb, CEO of New Home Co.
One of my clients got out bid on a $1.4m home in Baker Ranch by a FCB recently. FCB are still out there and buying, just not as many. Also, many of them are using asset based loans to make their purchases (i.e. put more 50% or more down and then get a higher rate ARM type loan for the remainder and move over the cash to pay it off).
Toll Brothers Orders Plunge as California Buyers Vanish
https://www.bloomberg.com/news/arti...rs-plunge-as-california-move-up-buyers-vanish
"California orders took a hit, in part, because Chinese buyers are getting scarce as China tightens controls on capital outflows. This is not just an issue for Toll but for anybody selling homes to the Chinese,"
A Market Correction is an Opportunity
?A market downturn doesn?t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.?
Warren Buffett
This can be applies to all asset class including housing.
It?s easier to say when your top .05% like in the world. It?s like saying take the risk and buy low. (In actuality we don?t know what low is)
He bought stocks/preferred stocks pennies of the dollar. (Only if we had the opportunity to get the same deal.) Not to get technical, but you need buyers to stablelize a falling market.
Hence why I'm seeing more FCB use asset based loans from Chinese banks like Cathy, East West, and Sterling. As long as they put 50% or more down they are good to go because to the bank a sub 50% LTV loan on an Irvine home is about as safe of a loan as you can get. Then the FCBs trickle in cash from China and pay off the loan....easy peasy.
There is always a way to bring money over and buy.
Irvine, has been and will be always desirable choice for properties ownership, if one's can stomach the high tax and high hoa.
OCLuvr said:
NO ECONOMIC RECESSION
But there will be market consolidation around where we are - probably a dip in the summer ? which will get bought
So if ppl waiting for a actual recession to buy a house , you may be waiting for a long long time .
Buying a house may still not make financial sense for many - but THATS a different decision. I am talking specifically about use of recession as a catalyst to buy.
ThirtySomethingWEquity
Active member
fortune11 said:
My point was, even without a recession, you can still have a major housing downturn in the 1.5+ market if the FCB dry up. Even in a booming economy, salaries in OC aren't going to support the glut of huge expensive houses we have.
irvinehomeowner
Well-known member
ThirtySomethingWEquity said:
What % of the Irvine market is supported by *Chinese* FCBs?
I just think there is a wide variety of buyers for Irvine beyond just that one demographic.
irvinehomeowner said:
I myself had this misconception that FCBs were biggest proportion of high end buyers till I talked to actual people doing the buying
It is diverse mix - doctors from hoag, small business owners that CV mentioned , tech people , mgmt consultants , finance types
fortune11 said:
?In Southern California and primarily, Orange County and even more significantly Irvine, the foreign buyer and principally, the Chinese foreign buyer, first and second generations, made up 75 percent to 80 percent of the marketplace,? Larry Webb, CEO of New Home Co., recently told investors. ?And certainly, in the second half of last year, that buyer group was reduced significantly.?
https://www.ocregister.com/2019/03/...tion-10-as-luxury-market-chinese-buyers-fade/
But hey, maybe IHO and fortune11 know more than Larry Webb, CEO of New Home Co.
usctrojancpa
Well-known member
ThirtySomethingWEquity said:
One of my clients got out bid on a $1.4m home in Baker Ranch by a FCB recently. FCB are still out there and buying, just not as many. Also, many of them are using asset based loans to make their purchases (i.e. put more 50% or more down and then get a higher rate ARM type loan for the remainder and move over the cash to pay it off).
fortune11 said:
Toll Brothers Orders Plunge as California Buyers Vanish
https://www.bloomberg.com/news/arti...rs-plunge-as-california-move-up-buyers-vanish
"California orders took a hit, in part, because Chinese buyers are getting scarce as China tightens controls on capital outflows. This is not just an issue for Toll but for anybody selling homes to the Chinese,"
irvinebullhousing
Well-known member
fortune11 said:
A Market Correction is an Opportunity
?A market downturn doesn?t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.?
Warren Buffett
This can be applies to all asset class including housing.
irvinebullhousing
Well-known member
The principles remain constant for Buffet. He truly lives by his words.
Compressed-Village said:
It?s easier to say when your top .05% like in the world. It?s like saying take the risk and buy low. (In actuality we don?t know what low is)
He bought stocks/preferred stocks pennies of the dollar. (Only if we had the opportunity to get the same deal.) Not to get technical, but you need buyers to stablelize a falling market.
this is why I love this discussion -- both eyephone and CV are correct
Buffet -- got breaks at every step -- used his dads political connections and then had the ultimate jackpot of working with Charlie munger, the genius behind the operation. he was also fortunate to build his business when interest rates were high and value investing was something that actually yielded tangible gains as opposed to the liquidity driven markets we have now. He preaches an innocent game but witness how he used his blue chip name to get deals none of us can even dream about.
So I generally heavily discount whatever these famous people like Buffet have to say because they got breaks none of us will ever get. Same goes for Bill Gates etc.
I also give eye phone credit for catching the downturn early on late 2017 or early 2018 when most others here were not focusing on it as much.
But to CV's point -- one cannot live in the past. Whats done is done, SUNK COST. If there are better deals to be had, now is the time to use the attractive mortgage rates to use them.
Again if you hold stocks in your portfolio at this moment, doesn't matter what else you say on this forum -- you implicitly believe that there will be no recession this year or most of next year
And anyone who claims to know what will happen past 2020 is pure conjecture and fantasy.
All we can do is react to data and early leading indicators. thats where I look at interest rates forward curve, homebuilder stocks, Fed posture , etc. And hence my belief that we are bottoming out here on a macro level.
Buffet -- got breaks at every step -- used his dads political connections and then had the ultimate jackpot of working with Charlie munger, the genius behind the operation. he was also fortunate to build his business when interest rates were high and value investing was something that actually yielded tangible gains as opposed to the liquidity driven markets we have now. He preaches an innocent game but witness how he used his blue chip name to get deals none of us can even dream about.
So I generally heavily discount whatever these famous people like Buffet have to say because they got breaks none of us will ever get. Same goes for Bill Gates etc.
I also give eye phone credit for catching the downturn early on late 2017 or early 2018 when most others here were not focusing on it as much.
But to CV's point -- one cannot live in the past. Whats done is done, SUNK COST. If there are better deals to be had, now is the time to use the attractive mortgage rates to use them.
Again if you hold stocks in your portfolio at this moment, doesn't matter what else you say on this forum -- you implicitly believe that there will be no recession this year or most of next year
And anyone who claims to know what will happen past 2020 is pure conjecture and fantasy.
All we can do is react to data and early leading indicators. thats where I look at interest rates forward curve, homebuilder stocks, Fed posture , etc. And hence my belief that we are bottoming out here on a macro level.
usctrojancpa
Well-known member
Kenkoko said:
Hence why I'm seeing more FCB use asset based loans from Chinese banks like Cathy, East West, and Sterling. As long as they put 50% or more down they are good to go because to the bank a sub 50% LTV loan on an Irvine home is about as safe of a loan as you can get. Then the FCBs trickle in cash from China and pay off the loan....easy peasy.
irvinebullhousing
Well-known member
USCTrojanCPA said:
There is always a way to bring money over and buy.
Irvine, has been and will be always desirable choice for properties ownership, if one's can stomach the high tax and high hoa.