Observations from the front lines of the Irvine housing market?

[meccos12]

Just saw this come up on redfin feed.
https://www.redfin.com/CA/Irvine/89-Nassau-92620/home/40101603

Props to Martin for getting sellers to come down so much from list price on this house.
Although the original list price was ridiculously high, it takes some skills to talk down prices this much for a house that was on the market for only a month.

I would love to hear the details on how the price was driven down 140K from list.

The home was sitting on the market for a bit of time and it was grossly overpriced, not even sure how they came up with that high price.  We took a close look at closed comps and decided to start with an offer at $1.4m emailing the listing agent closed comps to support our offer amount since the home was a complete blank slate (my client actually liked that because they weren't paying for other people's upgrades).  I think the listing agent probably had a heart-to-heart discussion with the seller that if they wanted to sell it that they'd have to come down a good bit.  I'm sure she forwarded my email with my analysis of why our original offer of $1.4m was reasonable which probably helped.  The owner is going to renovate the home so it'll look 10x better when they are done with it and they'll get every penny back for all of the updated (wood flooring, paint, counters, bathrooms, etc).

All the sold comps Ive seen in Stonegate were much higher than this sold price.  What comps did you use to negotiate this?  Props to your negotiating skills

 

[usctrojancpa]

Just saw this come up on redfin feed.
https://www.redfin.com/CA/Irvine/89-Nassau-92620/home/40101603

Props to Martin for getting sellers to come down so much from list price on this house.
Although the original list price was ridiculously high, it takes some skills to talk down prices this much for a house that was on the market for only a month.

I would love to hear the details on how the price was driven down 140K from list.

The home was sitting on the market for a bit of time and it was grossly overpriced, not even sure how they came up with that high price.  We took a close look at closed comps and decided to start with an offer at $1.4m emailing the listing agent closed comps to support our offer amount since the home was a complete blank slate (my client actually liked that because they weren't paying for other people's upgrades).  I think the listing agent probably had a heart-to-heart discussion with the seller that if they wanted to sell it that they'd have to come down a good bit.  I'm sure she forwarded my email with my analysis of why our original offer of $1.4m was reasonable which probably helped.  The owner is going to renovate the home so it'll look 10x better when they are done with it and they'll get every penny back for all of the updated (wood flooring, paint, counters, bathrooms, etc).

All the sold comps Ive seen in Stonegate were much higher than this sold price.  What comps did you use to negotiate this?  Props to your negotiating skills

I primarily used the model match comp at 78 Medford to bring the price down....
https://www.redfin.com/CA/Irvine/78-Medford-92620/home/40101608

 

[eyephone]

Just saw this come up on redfin feed.
https://www.redfin.com/CA/Irvine/89-Nassau-92620/home/40101603

Props to Martin for getting sellers to come down so much from list price on this house.
Although the original list price was ridiculously high, it takes some skills to talk down prices this much for a house that was on the market for only a month.

I would love to hear the details on how the price was driven down 140K from list.

The home was sitting on the market for a bit of time and it was grossly overpriced, not even sure how they came up with that high price.  We took a close look at closed comps and decided to start with an offer at $1.4m emailing the listing agent closed comps to support our offer amount since the home was a complete blank slate (my client actually liked that because they weren't paying for other people's upgrades).  I think the listing agent probably had a heart-to-heart discussion with the seller that if they wanted to sell it that they'd have to come down a good bit.  I'm sure she forwarded my email with my analysis of why our original offer of $1.4m was reasonable which probably helped.  The owner is going to renovate the home so it'll look 10x better when they are done with it and they'll get every penny back for all of the updated (wood flooring, paint, counters, bathrooms, etc).

All the sold comps Ive seen in Stonegate were much higher than this sold price.  What comps did you use to negotiate this?  Props to your negotiating skills

This is just the beginning. Kens family member negotiated $50k off a new home, Toll brothers having a national sales event, and a whopping $140k off a a resell in this thread.

 

[marmott]

Toll already had a National Sales Event in July, not uncommon.

 

[eyephone]

Toll already had a National Sales Event in July, not uncommon.

But I believe the flier says this is the biggest sale of the year. Plus if you don?t see a Toll Brother you like, why not tell another builder if they can also provide discounts.

 

[marmott]

Toll has increased their incentives since July but not by much at least for the house we are considering (Not in OC).

 

[Kings]

Just saw this come up on redfin feed.
https://www.redfin.com/CA/Irvine/89-Nassau-92620/home/40101603

Props to Martin for getting sellers to come down so much from list price on this house.
Although the original list price was ridiculously high, it takes some skills to talk down prices this much for a house that was on the market for only a month.

I would love to hear the details on how the price was driven down 140K from list.

The home was sitting on the market for a bit of time and it was grossly overpriced, not even sure how they came up with that high price.  We took a close look at closed comps and decided to start with an offer at $1.4m emailing the listing agent closed comps to support our offer amount since the home was a complete blank slate (my client actually liked that because they weren't paying for other people's upgrades).  I think the listing agent probably had a heart-to-heart discussion with the seller that if they wanted to sell it that they'd have to come down a good bit.  I'm sure she forwarded my email with my analysis of why our original offer of $1.4m was reasonable which probably helped.  The owner is going to renovate the home so it'll look 10x better when they are done with it and they'll get every penny back for all of the updated (wood flooring, paint, counters, bathrooms, etc).

All the sold comps Ive seen in Stonegate were much higher than this sold price.  What comps did you use to negotiate this?  Props to your negotiating skills

I primarily used the model match comp at 78 Medford to bring the price down....
https://www.redfin.com/CA/Irvine/78-Medford-92620/home/40101608

that model is infinitely nicer than the home you client purchased.  i bet the seller's agent's sphincter tightened up real good when you sent them that comp.

 

[usctrojancpa]

Just saw this come up on redfin feed.
https://www.redfin.com/CA/Irvine/89-Nassau-92620/home/40101603

Props to Martin for getting sellers to come down so much from list price on this house.
Although the original list price was ridiculously high, it takes some skills to talk down prices this much for a house that was on the market for only a month.

I would love to hear the details on how the price was driven down 140K from list.

The home was sitting on the market for a bit of time and it was grossly overpriced, not even sure how they came up with that high price.  We took a close look at closed comps and decided to start with an offer at $1.4m emailing the listing agent closed comps to support our offer amount since the home was a complete blank slate (my client actually liked that because they weren't paying for other people's upgrades).  I think the listing agent probably had a heart-to-heart discussion with the seller that if they wanted to sell it that they'd have to come down a good bit.  I'm sure she forwarded my email with my analysis of why our original offer of $1.4m was reasonable which probably helped.  The owner is going to renovate the home so it'll look 10x better when they are done with it and they'll get every penny back for all of the updated (wood flooring, paint, counters, bathrooms, etc).

All the sold comps Ive seen in Stonegate were much higher than this sold price.  What comps did you use to negotiate this?  Props to your negotiating skills

This is just the beginning. Kens family member negotiated $50k off a new home, Toll brothers having a national sales event, and a whopping $140k off a a resell in this thread.

The thing is not all listing prices are created equal. The listing price on 89 Nassau was insane so it closing $140k below the listing price doesn?t really give any good insight to what?s going on in the market other than buyers won?t pay stupid asking prices. I?d venture to say if they had priced it around $1.45m it would have sold quicker. 

 

[notTHEoc]

USC, a while back you had commented on a bit of softening in the rental market partly from a lot of supply from people who had been hanging on to their starter homes and also investors renting out brand new homes.

Any changes you?ve noticed in the rental market over the last 6 months or so? Thx.

 

[irvinebullhousing]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

 

[Goriot]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

I believe this week is Chinese National Holiday Day week.  Whole week for Chinese to fly over and shop for homes=) Golden week for new home selling.

 

[Ready2Downsize]

I don't really like Laguna Niguel (it's too far from freeways) and certainly this isn't an Irvine home, but did this house not sell for two years because of the d?cor?
https://www.redfin.com/CA/Laguna-Niguel/24071-Pinehurst-Ln-92677/home/4942091

Google maps shows this as an older neighborhood but nice homes (I see most driveways were redone and these homes are over 25 years old.

Seems like in a good housing market this could be a decent flip for the price they paid.

OR for someone who thinks living on a farm is a good idea.

 

[irvinebullhousing]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

I believe this week is Chinese National Holiday Day week.  Whole week for Chinese to fly over and shop for homes=) Golden week for new home selling.

Ah ok, so why can?t American workers get those week long vacation too? Money made need to spend, not good when you too busy to spend it.

 

[meccos12]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

Maybe you saw me there.  Sometimes I stop by to pick up some cold water. 

 

[eyephone]

That?s funny. It?s all about the freebies. 

 

[irvinebullhousing]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

Maybe you saw me there.  Sometimes I stop by to pick up some cold water.

Were you the only dude in a group of several women and talking like he ready to buy up a couples of those homes?

 

[Cares]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

I believe this week is Chinese National Holiday Day week.  Whole week for Chinese to fly over and shop for homes=) Golden week for new home selling.

If they can get the money out...I know of people that have "all the money in the world" but can't get any money out of China to buy real estate here. They have to find alternative means to "smuggle" money in.

 

[usctrojancpa]

Stopped by Cadence Park today particularly Duet, and I can tell you that there is a lot of Chinese buyers tour the model and Cadence Park neighborhood today. I was there late in the afternoon and while I sat there within half an hour several families stopped into the models A few young couples with parents also stopped in. So as far as I can tell, it doesn't seem like any slow down happening at new development.

On the other hand of sellers price reductions, 2 of them that I know are in contract to buy a bigger home and selling and cutting prices to get going with their new build. The new builder in turn gave them some nice closing credits and upgrade.

This is rather a small sample and observation, but the ones that can buy, they're still buy. IHO message is heard loud and clear, J/K. Most of those probably don't even know TalkIrvine existence.

I believe this week is Chinese National Holiday Day week.  Whole week for Chinese to fly over and shop for homes=) Golden week for new home selling.

If they can get the money out...I know of people that have "all the money in the world" but can't get any money out of China to buy real estate here. They have to find alternative means to "smuggle" money in.

Where there's a will, there is a way. 

 

[usctrojancpa]

USC, a while back you had commented on a bit of softening in the rental market partly from a lot of supply from people who had been hanging on to their starter homes and also investors renting out brand new homes.

Any changes you?ve noticed in the rental market over the last 6 months or so? Thx.

The rental market looks like it has stabilized with the number of active rental listings remaining in a constant range.  Just like with resale homes, the nicer rental properties that are priced right rent very quickly.

 

[usctrojancpa]

Excuse the delay in posting up the August data but I've been swamped the past few weeks.  Aug 2018 sales were down 5.6% from Aug 2017 but rebounded 8.3% from July 2018.  From a trailing 12-month Aug 2018 perspective Irvine sales are down 2.3% or 65 transactions.  Inventory as of 8/31/18 increased slightly at 1.1% from 7/31/17 but increased 20.8% from the inventory level as of 8/31/17.  Based upon this data, we still remain just under 3 months of inventory using Aug 2018 sales and 2.87 months of inventory (up from 2.66 months of inventory through July 2018) using the past 3 months which remains a weak seller?s market.  Inventory levels should have peaked around Labor Day but inventory levels are up slightly today versus 8/31/18.  So inventory levels are flat to rising when they should be falling slightly.

What does this all mean?  The market has continued to slow from the end of July 2018 despite the uptick in Aug 2018 (mainly due to increasing inventory along with weaker sales in Sept 2018).  I'm seeing a lot of new home inventory hit the market, whether it's Eastwood, Orchard Hills, Portola Springs, and/or Cadence Park/Altair.  Homes that are priced above recent closed comps are sitting as are properties that aren't turnkey or have unicorn features (larger lot and/or view lot).  There are still plenty of buyers out there but they are being more patient as there are more homes to pick from along with seeing price drops.  The $1m+ is continuing to slow down more than the sub $1m market as inventory levels in that segment increase at a faster rate.  From the new home builder front, just about every builder has now increased their broker co-ops with CalPac being the latest one (they sell mostly sub $1m homes).  There are still a lot of "optimistic" sellers out there so it'll be interesting to see if they pull their homes off the market or decide to cut prices to actually sell their homes.

On the 30-year fixed interest rate loan front, rates have increased in mid Sept to about 4.625-4.75% compared to just under 4.50% at the end of Aug 2018.  Rates have crept up as the stock market continues to go up along with stronger economic data.  Rates on 7/1 ARM loans are up to around 3.75%  today from basically being around 3.50% in Aug.  I still think the near term cap on 30-year fixed rates will be 5% but I guess we shall see.