Who are all these buyers?

[irvinehomeowner]

I say you throw stones because you call the current market in Irvine "garbage", yet... you do hope that someday John's Creek becomes "garbage" too.

At least that's what I thought you said.

And perfect weather is a big deal... relatives of mine thought that the cheap prices for brand new homes in Texas would make up for the SoCal shortcomings... they were back in less than 2 years and ended up shorting that house and are now renting an older house half the size and not looking back.

On materialism... I dunno... I guess I see it but you'll see it in any middle/upper income area... or even relatively in lower income areas... it's everywhere (even John's Creek)... RC's view is rather myopic because he already has a fixed perception of what Irvine life is. Even if he moves to Long Beach, I assure you he will see some level of the same thing... but would ignore it because it was he who chose that area to live in.

Even in the 'hood where I grew up... a bid deal was made if you had a NEW Nissan vs an older Toyota... or if you had a Schwinn Cruiser instead of a Huffy.

 

[Irvine2Irvine]

Thanks for sharing Irvine2Irvine,

It appears that you have became financially independent on your own through your wise investment in 1995 and I applaud you for that. I would like to get your input on couple of things. Irvine seems like the "Dream" place to live if you are already weatlhy, but for someone starting out with very little, no parental financial help, and trying to become financially independent in their early 30s, Irvine seems to a tough place. Had I bought a home in Sonoma, I would be been pretty much wiped out of my savings, practically all of it going in the home.

As you know, I purchased a new home in Atlanta for a closing price of $480,000 with all the upgrades. It is definitely in the highend of what i wanted to spend, but it is a home where the Panda family plans to live for atleast 10 - 15 years like you did with your first Irvine home. IHO makes fun of me sometime that i am throwing stones from my Georgia home, but I will admit it to IHO, that you can't compare Johns Creek, GA with Irvine, CA as Irvine is clearly better and has more prestige than Johns Creek, GA today. However outside of the perfect weather and the nice beaches, Johns Creek had everything I wanted with top schools, nice new subdivisions, low crime, low taxes, and lots of nice new Asian markets. The mortgage on my third home would bring up my total mortgage to almost a $1 million dollars (30 year fixed in the 4s). The reason I can sleep at night is because i have the cash and liquid investments to pay off the entire loan anytime. My mindset is to think like a banker where if i can borrow at 4.25% i need to invest the money wisely get a higher return (arbritrage) than 4.25% annually. Though I love Irvine, I knew that i would be sacrificing too much of my values, family, and my goal of becoming financially independent.     

Irvine2Irvine, do you agree with some of statements that RC has made about Irvine regarding materialism, neighborhood competition, and pressure to consume to keep up with the status quo? Would you say there is  a lot pressure to spend and consume in Woodbury? 

You are giving me too much credit, Panda.  I didn't really know what I was doing in '95 when I bought my first house.  All I remember is that all of my relatives and my friends were telling me that I was crazy buying a house when the housing market is in the tanks.  They were all telling me that home ownership is dead and I should invest all of my money in mutual funds and stocks.  All I can say is that after being married for one year and renting for one year, buying a house just seemed right.  I guess I just got lucky.  But, I kind of feel the same way about buying Sonoma at Woodbury in 2010.  It just feels right, probably because I "NEED" more space for my family.  But, I am planning to stay here for next 15 years, so all I really care about is that I can make the payments and enjoy the new house with my family.

As for a couple starting out, Sonoma would be too much of a house for someone starting out unless you are making combined income of $250K+.  If you are starting out with modest income and want to live in Irvine, you probably have to do what I did.  Buy an old small house for less money and no mello roos.  Otherwise, you are just asking for trouble.  I know it sucks, but it's just the way it is in Irvine right now.  Also, I want to repeat one more time that Irvine is not "THE" place to live.  I can think of a dozen places I want to live in Orange County instead of Irvine.  Irvine is "nice", but definitely not the magical place many people seem to believe.

As for your other question regarding materialism, neighborhood competition, and pressure to consume to keep up with the status , I do not agree with RC.  I think it really depends on who your friends are, and more importantly who you are.  I know that to some of my relative and friends that keeping up with the "Jones" is VERY important and nothing hurts them more than someone close to them doing better than they are, whether its the house or cars.  All I can say is that they lack the self esteem and all they can do is measure themselves to others with their material possesions.  Some of my wife's high school friends live in an apartment and barely make ends meet but lease new Mercedes and Lexus!!???  But, they can never afford to go on a "good" vacation.  To me it's more important to go on a family vacation to Hawaii or Europe or wherever you really want to go and build lasting memories.  Do you really have fond memories of what your parents drove or where you vacationed when you were a kid???

I spend money where I feel I would get the most satisfaction, not where I think I would get most "envy" from my neighbors.  Many of my friends who live in Irvine are the same way.  Be confident about yourself and you will not be "bothered" by what others "THINK".

 

[IndieDev]

I can understanding buying because it makes sense for someone's personal situation.  Some people just need to have the best 4 walls money can buy. Some need luxury cars with 600 horsepower, but comparing 1995 Irvine to 2010 Irvine is like comparing a rowboat to the Titanic. The disparity between incomes and home prices in 1995 was close to "normal" affordability. Median household income $60,000, and the average SFR cost $228,000 (3.8 LTI). In 2010, the average Irvine home price is $546,500, the median household income is around $110,000 ( a 5.0 ratio LTI).

Rents back then were comparable to now (inflation adjusted), not surprising since those numbers are driven by income rather than access to credit.

In the end though, Irvine home prices are largely manufactured through clever marketing. If you're comfortable with paying for that marketing, then prices make sense. Otherwise, no.

 

[sonoma]

I can understanding buying because it makes sense for someone's personal situation.  Some people just need to have the best 4 walls money can buy. Some need luxury cars with 600 horsepower, but comparing 1995 Irvine to 2010 Irvine is like comparing a rowboat to the Titanic. The disparity between incomes and home prices in 1995 was close to "normal" affordability. Median household income $60,000, and the average SFR cost $228,000 (3.8 LTI). In 2010, the average Irvine home price is $546,500, the median household income is around $110,000 ( a 5.0 ratio LTI).

Rents back then were comparable to now (inflation adjusted), not surprising since those numbers are driven by income rather than access to credit.

In the end though, Irvine home prices are largely manufactured through clever marketing. If you're comfortable with paying for that marketing, then prices make sense. Otherwise, no.

Yeah it's like who are all those peeople buying all those Apple stocks at $335 when it should be really a $10 stock like it was back in 1995.    Let's face it, people are getting rich, even if the economy is not all that hot. 

 

[OCMommy]

Bottom line, things are selling and there are a lot of peoplenout looking at homes!

 

[IndieDev]

I can understanding buying because it makes sense for someone's personal situation.  Some people just need to have the best 4 walls money can buy. Some need luxury cars with 600 horsepower, but comparing 1995 Irvine to 2010 Irvine is like comparing a rowboat to the Titanic. The disparity between incomes and home prices in 1995 was close to "normal" affordability. Median household income $60,000, and the average SFR cost $228,000 (3.8 LTI). In 2010, the average Irvine home price is $546,500, the median household income is around $110,000 ( a 5.0 ratio LTI).

Rents back then were comparable to now (inflation adjusted), not surprising since those numbers are driven by income rather than access to credit.

In the end though, Irvine home prices are largely manufactured through clever marketing. If you're comfortable with paying for that marketing, then prices make sense. Otherwise, no.

Yeah it's like who are all those peeople buying all those Apple stocks at $335 when it should be really a $10 stock like it was back in 1995.    Let's face it, people are getting rich, even if the economy is not all that hot.

Haha. I'm not sure if you're joking, but that may have been one of the most unintentionally funny things I've seen posted on this forum.

 

[sonoma]

I can understanding buying because it makes sense for someone's personal situation.  Some people just need to have the best 4 walls money can buy. Some need luxury cars with 600 horsepower, but comparing 1995 Irvine to 2010 Irvine is like comparing a rowboat to the Titanic. The disparity between incomes and home prices in 1995 was close to "normal" affordability. Median household income $60,000, and the average SFR cost $228,000 (3.8 LTI). In 2010, the average Irvine home price is $546,500, the median household income is around $110,000 ( a 5.0 ratio LTI).

Rents back then were comparable to now (inflation adjusted), not surprising since those numbers are driven by income rather than access to credit.

In the end though, Irvine home prices are largely manufactured through clever marketing. If you're comfortable with paying for that marketing, then prices make sense. Otherwise, no.

Yeah it's like who are all those peeople buying all those Apple stocks at $335 when it should be really a $10 stock like it was back in 1995.    Let's face it, people are getting rich, even if the economy is not all that hot.

Haha. I'm not sure if you're joking, but that may have been one of the most unintentionally funny things I've seen posted on this forum.

Yup, very funny!  Apple is up another $6 today. 

 

[IndieDev]

What about the median price of irvine homes? 

 

[sonoma]

Maybe up $6 today...lol. 

 

[socal78]

Just heard some news from an acquaintance a second ago that made me think of this thread. Their friend just sold their Irvine home in about 10 days for all cash to a Taiwanese man... around $800k is what I heard. They were "surprised" how fast and how much - the cash part too- but I know we all here are not. Funny how commonplace that is and it does not faze us anymore.

 

[sonoma]

Are people still getting mortgages these days?

 

[irvinerealtor]

Are people still getting mortgages these days?

Yes. Yes, they are... but the cash buyers are still around too.

 

[usctrojancpa]

Are people still getting mortgages these days?

Mortgages are so annoying...they are going out of fashion in Irvine.