Will I ever be able to buy?

NEW -> Contingent Buyer Assistance Program
I am wondering if maybe folks are influenced by the "Buy foreclosures with no money down" infomercials? I wonder if maybe the folks they see on tv who are supposedly making an extra $200,000 per year by following sos and sos plan are compelling? I don't know. I am having a hard time understanding why anyone would think that buying investment property would be a prudent decision if they considered reality.<p>

Why? Why would anyone think that now is a good time to buy investment property? I am not being sarcastic. I really want to know.
 
<p>IR,</p>

<p>I think you and I are in agreement that we want the data to be accurate.</p>

<p>I admire you for having a strong conviction that home prices in Irvine will drop signigficantly. The market in Irvine is very different as it is unique for what it has to offer. Many folks wish to live in Irvine for a good reason. The message you are sending, my take, is do not buy. With the overwhelming demand for people want to live in Irvine, how could anyone go against the flow. What if folks miss buying at the current price in Irvine, how bad will you feel?, IR!</p>

<p>I do not believe in market manipulation as I think it is unethical. I am not sure why I am classified as a re bull while I stated before I am neither bearish or bullish.. Any investment has risks, no pain no gain.</p>

<p>I will give you one example of misinformation that I noticed that came up a lot,</p>

<p>Your post on 131 Talmadge in Irvine, ZIP code 92602:</p>

<p opkor="0" o62hd="0"><em><strong>"You have to love properties like this one. A flipper who timed the market top perfectly walked away from this nightmare and left the bank holding the bag."</strong></em></p>

<p opkor="0" o62hd="0">The key word is <strong><em>flipper.</em></strong> <strong>I am not sure the buyer of this foreclosed property was a flipper</strong> as it does not really fit the description of a flipper.</p>

<p opkor="0" o62hd="0">I researched the MLS transaction history, and this is what I found:</p>

<p opkor="0" o62hd="0">1) Property was listed on 4/26/06 for $716K. I ran the comps for this period, this property had a market value of $650K - $675K, based on its condition.</p>

<p opkor="0" o62hd="0">2) Property closed escrow on 6/23/06 for $760K ($44K above asked price). 100% financing. It appears that the sold price was $75K over market price. A flipper would not pay above market price unless he/she is insane.</p>

<p opkor="0" o62hd="0">3) Property was on the market for lease on 6/15/06 (before escrow closed). Tenant moved in 7/10/06. A flipper would flip right? Not became a landlord.</p>

<p opkor="0" o62hd="0">4) Property was on NOD on 1/4/07 (only after 6 months of ownership). An early default. A flipper not making a single mortgage payment? </p>

<p opkor="0" o62hd="0">I am curious to know why would you call this a flipper. </p>

<p opkor="0" o62hd="0"> </p>

<p opkor="0" o62hd="0"> </p>

<p opkor="0" o62hd="0"><strong><em></em></strong></p>
 
<p>reason,</p>

<p>The answer is both, whichever, has the lowest cost of financing.</p>

<p>For long term holding, people refi and cash out.</p>

<p>For short term holding, people draw from equity line.</p>
 
nirvinerealtor,





There is nothing wrong with <em>living </em>in Irvine. That is great. I love it here. It is <em>buying </em>in Irvine right now that is the problem.





<em> "What if folks miss buying at the current price in Irvine, how bad will you feel?, IR!"</em>





Never in history has the "priced out forever" scenario come true, so I am not too worried about missing out on a good deal. I sleep well at night.





I have a question for you though, "If convincing people to buy now causes them to go through foreclosure and bankruptcy, how bad will you feel?"
 
New Discussion Idea - "Purchasing a Rental Property in Today's Market (Summer 2007)"

<p>I think there is an educational opportunity here which would benefit all visitors to the blog: an open discussion about finding a rental property which would make a good investment in today’s market.</p>

<p>Hopefully Reason would be willing to share his financial situation (remember, you are anonymous!) and Nirvinerealtor would be willing to recommend a property which she considers a good rental investment – perhaps in Irvine!</p>

<p>We would need a loan expert to work out various financing scenarios given Reason’s position. Terms could be explained during this process - it could be kind of a primer for understanding loans perhaps.</p>

<p>We would also investigate the “what if” scenarios regarding interest rates and RE property values. Here the opinion of the bulls and bears diverge, so we could independently work out the scenarios they are predicting.</p>

<p>We could improvise if Reason is not interested in participating, but he ought to play along as it would be really beneficial not just to him, but all others contemplating similar moves. Free advice from experts!</p>

<p>Just an idea…</p>
 
<p>IR,</p>

<p>I have never convinced people to buy now. People do what they want to do, or can do. I do ask people to consider what ifs though.</p>

<p>Foreclosure and bankruptcy can happen to anyone, owner or non-owner. I heard medical bills are number one cause for people to go into bankruptcies. </p>

<p>I think you analyze and worry too much. I sold a home to someone who is just like you. He went through the whole cyle .. bought, market crash, job loss, had to sell,.. and came out just fine. I was like his 10th agent whom he approached to help him into 1st time home ownership. Indecision and fear of buying was driving him and his whole family to the wall.</p>

<p> </p>
 
nirvinerealtor,<em>





"Indecision and fear of buying"</em>





I think you must realize this is not part of my personality. I actively trade stocks, options and futures: risk and I are old friends. Pulling the trigger on large transactions is something I do on a weekly or daily basis.





I am glad you council people on the "what ifs" because there is a likely and very serious "what if" in play right now.





As for foreclosure and bankruptcy happening to anyone, yes, it certainly can. It is the avoidable reasons under control of the individual that I am trying to help people avoid.
 
<p>reason,</p>

<p>I don't understand why you are so defensive. It sounds to me that you are uptight and need to lighten up. I also don't understand how my last comment was bearish. To those who read The OC Register they might find my comment to be humorous albeit on the dry side. Do you read the OC Register? If not you may want to look into Daniel Sadek and his company Quick Loan Funding. </p>

<p>You are right this is a forum about Irvine and real estate and with that come opinions. Most here are bearish including myself. If you are coming here to learn then I suggest you do it with more of an open mind. If you only want to hear bullish opinions your frustration may only continue here. I am not suggesting you stop contributing but you can learn from the bears here just as you can learn from the bulls like nirvinerealtor. Many of the bears here have made money on real estate and continue to make money on real estate including myself. </p>

<p>You can chose to ignore me and I am fine with that but I can't say that I will ignore you. I have fun egging the bulls on. I have definitely egged nirvinerealtor on more than anyone but we have also had some very civil and educating conversations. Nirvinerealtor and I may not share the same opinions but without her contributions it could mean I may not learn something from her. Hopefully she feels the same and has either learned something from me or at least believes that one day she will. </p>

<p>So enjoy the blog and the forums here but don't expect bullish opinions coming from me or the other bears for some time to come. </p>
 
"<i>I think you analyze and worry too much. I sold a home to someone who is just like you. Indecision and fear of buying was driving him and his whole family to the wall."</i><p>



NIR - Your client doesn't sound anything like IR and although it may be convenient to characterize IR as too analytical, worrisome, indecisive or fearful, my experience in this blog is that IR is pretty much the opposite of your characterization. IR is anything but indecisive. It takes guts, thoughtful analysis, and self-determination to sell when everyone else is buying, or when everyone is saying if you don't buy now you may not be able to buy later, or you can afford a 55% DTI, or they wouldn't loan you the money if you couldn't afford it, or if you want it bad enough you can do it, or any number of fallacies told to potential buyers in order to close a deal and make a commission. My experience is that IR is thoughtful and intelligent, not over analytical. I have seen nothing to indicate that he worries about his decisions. Au contraire, he seems very happy with his decision to rent and buy at an advantageous time. And he is anything but fearful, which is a reaction to the unknown. Since he has taken the time to look at the re market objectively, he seems to be very knowledgeable about the re market and has nothing to fear.<p>

And how could he possibly feel poorly about the advice he has given? Have you read the thread regarding how much money this blog has saved folks by helping them decide to rent instead of buy? He ought to patting himself on the back, unlike any who may have denied the obvious signals the market has been sending and have advised folks to get themselves in over their financial heads in a mortgage that will cause them to lose their homes, equity, savings, and cause financial and emotional pain. Thank goodness for folks like IR who are willing to tell the truth.
 
In his post, Reason talks about "cashing out". One thing that really bothers me is when people talk about "cashing out" as if they are taking money that they actually have out of the house. YOU DO NOT CASH OUT UNTIL YOU SELL!!!!! THE MONEY IS NOT YOURS UNTIL YOU FIND SOMEONE WILLING TO BUY YOUR HOUSE FOR AN AGREED UPON PRICE AND CLOSE THE DEAL!!!!! You are NOT cashing out. You are just BORROWING MORE MONEY against the property. That is what refinancing and lines of credit are -- LOANS!





I believe part of what got us into this mess in the first place was people seeing their neighbors selling at insane prices and then believing that their house was worth the same as what their neighbors sold for. Because their house was "worth" that much, they were entitled to the money and were simply "cashing out" to buy another house or the expensive toys. But, you are NOT entitled to that money. All of the market moves are just on paper. The only time that money is actually yours is when you sell. People only felt rich. They weren't actually any richer. In fact, they were making themselves poorer by borrowing more money and spending it on depreciating assets.





Sorry for the rant, but it is just something I think we all need to remember.
 
<p>IR,</p>

<p>I truly appreciate you taking time to write about different neighborhoods and the feature failed properties as I both learn and save time because of you. Thank you. I also mentioned that I was impressed with your strong conviction that home prices will drop signigficantly. I believe that you have access to lots of financial data, which I do not; as the result, it is very difficult for me to comprehend.</p>

<p>House is a necessity, just like food, cars, freedom, and the tendency to get married and have children. House is a place you can call home. Since buying a home is an emotional decision, I do not see any reason for me to even trying to analyze whether real estate is a depreciating or appreciating asset (I do not think we can firmly predict the future when we do not have all the future control factors). And fears control emotion! And most people buy what they can afford. For those who extended themselves financially; perhaps, that is ok because everyone is different.</p>

<p>That being said, I observe people and their buying pattern, and project the market from there. My projection works very well for me.</p>

<p>I am a financial conservative; perhaps, too conservative. Example, I keep my DTI ratio at below 10%; plainly pathetic. It is difficult for me to break out of my molds. Perhaps, that is why I try to sound more on the bullish side. I am being very honest here.</p>

<p>I do think you are very unique. And you write very well.</p>

<p>graphrix,</p>

<p>Of course I am learning so much from you. Pershaps, I do not give people enough compliments. Thank you much! </p>
 
nirvinerealtor





I believe Irvine, indeed, the entire So Cal is overpriced. On the other hand, I also agree with you that buying house is a emotional decision, and a lot of people do not think of it as a investment. Therefore, I actually think the price will stay at this unreasonable rate for quite some time, even increase if a lot of Asian move into Irvine and they behave like what BK said they would behave. I recently returned from a trip to Shanghai. The average price is whopping 30 times the average salary over there, yet houses are still selling, and it has been this way for the past 10 to 15 years.
 
nirvinerealtor


Another thing, have you checked out the SAM loan we discussed some days ago? I can't find any information beyond what my friend told me
 
<p>tour,</p>

<p>I think you want to talk to the SAM provider? I do not want to put the company name here as I have not fully checked them out. I also do not want to advertise for them either.</p>

<p>If you like, you can e-mail me and I will give you the website. They are local so you can visit them in the office too, which I recommend you do. You will have to promise me not to make it public until you are totally comfortable with the practice. If it turns out NO GOOD, I do not want to appear that I endorse the product in anyway. I have no interest in this company.</p>

<p>My phantom address is <a href="mailto:nirvinerealtor@gmail.com">nirvinerealtor@gmail.com</a>. I do not need to know who you are either.</p>
 
<p>I was there for business reason. My company is thinking about expending to oversea market, and we are doing studies on whether we should go to China (shanghai) or Germany(Saxony). Looks like Germany will win in this case. </p>
 
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