Talk Irvine

General => Real Estate => Irvine Real Estate => Topic started by: WTTCHMN on July 09, 2021, 08:58:29 PM

Title: 68 Irvine townhomes priced as low as $425,000
Post by: WTTCHMN on July 09, 2021, 08:58:29 PM
68 Irvine townhomes priced as low as $425,000

https://www.ocregister.com/2021/07/09/6052-join-lottery-for-68-irvine-townhomes-priced-as-low-as-425000/
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: aquabliss on July 10, 2021, 02:01:37 AM
This is no good for the buyers unless they want to stay for life, even then not great.  My co-worker bought one of these condos years back with similar restrictions mentioned in the article:

The maximum sales price can go up only at a rate equal to yearly growth in local incomes. Plus, the future buyers must meet the same income limits, after annual adjustments for inflation.

So say for example he buys for $500k, and he sees all his friends and families homes going up up up over the years, hundreds of thousands of dollars.  However based on the contract he signed he can only sell for maximum $575k 10 years later.  Puts him in a worse position than if he would have purchased a home somewhere else for less $ but without these restrictions.

My co-worker couldn’t wait to ditch that place and start earning some equity.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: akula1488 on July 10, 2021, 02:13:03 AM
But good enough for elderly people to retire and die in this kind of housing as they don't care about equity?
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: moc on July 10, 2021, 02:34:01 PM
But good enough for elderly people to retire and die in this kind of housing as they don't care about equity?

Maybe, but these are two and three story townhomes. Lots of stairs, not great for older folks.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: Bullsback on July 12, 2021, 12:45:50 PM
This is no good for the buyers unless they want to stay for life, even then not great.  My co-worker bought one of these condos years back with similar restrictions mentioned in the article:

The maximum sales price can go up only at a rate equal to yearly growth in local incomes. Plus, the future buyers must meet the same income limits, after annual adjustments for inflation.

So say for example he buys for $500k, and he sees all his friends and families homes going up up up over the years, hundreds of thousands of dollars.  However based on the contract he signed he can only sell for maximum $575k 10 years later.  Puts him in a worse position than if he would have purchased a home somewhere else for less $ but without these restrictions.

My co-worker couldn’t wait to ditch that place and start earning some equity.
Not sure how this program works - but there are ones where after x number of years you can sell it to anyone and at any price (i.e., you eventually get your equity).  Its good for someone who probably isn't going to see their income grow a ton - but can stay in the house and intends to be in the area/live there for a long time (and gets a value for staying close to the rest of their family, etc).  And at some point - they get a pretty good value prop (but there are challenges re: sales).

I also thought you could get market appreciation in sales - but it was limited to the original base (but if market went up 20% - you got 20% - but from the original base).  The hard part is you have a smaller buyer base when it is under these guidelines (as not a ton of people will have the ton payment and qualify from an income perspective). 
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: Soylent Green Is People on July 12, 2021, 03:38:37 PM
Read there were big crowds there that day to buy. Anyone go?

These aren't the kinds of investment properties you'd want to lay cash into - if you could - nor are they great deals for owner occupants. Out of 100 buyers, 1-2 of them will first be willing, but also able to squeeze into these restricted units.

You can find decent resale homes nearby, albeit at a higher price, but with much greater resale benefits.

My .02c
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: keep_rollin on July 12, 2021, 04:16:27 PM
Sage Park (Portola Springs) - Irvine Community Land Trust
https://www.irvineclt.org/sage-park (https://www.irvineclt.org/sage-park)

These are being built by California Pacific and look like a clone of the Brisa (PS), Carissa (PS), and Lantana (CV) townhomes a couple miles away. There's one in Brisa listed a few days ago at $920k :o.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: Sidehussle on July 14, 2021, 03:41:53 PM
this is an interesting argument.

is it better to buy at a subsidized $500K and be able to save for a future move up house or-

buy at market say $1M, not be able to save but hope for future equity and price appreciation for the move up house

Who is better off?
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: AccidentalAnalytics on July 18, 2021, 09:04:06 AM
Factors to consider vs a 1million detached condo.

1) There is 200-300 hundred more HOA on these sub subsidized units.
2) Are you okay with the type of neighbors.
3) It could take a lot longer to sell since buyer pool is limited.


this is an interesting argument.

is it better to buy at a subsidized $500K and be able to save for a future move up house or-

buy at market say $1M, not be able to save but hope for future equity and price appreciation for the move up house

Who is better off?
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: irviniteeee on July 18, 2021, 03:53:31 PM
Factors to consider vs a 1million detached condo.

1) There is 200-300 hundred more HOA on these sub subsidized units.
2) Are you okay with the type of neighbors.
3) It could take a lot longer to sell since buyer pool is limited.


this is an interesting argument.



is it better to buy at a subsidized $500K and be able to save for a future move up house or-

buy at market say $1M, not be able to save but hope for future equity and price appreciation for the move up house

Who is better off?

Can I just say that the "type of neighbors" thing that people associate with low income (laughable that 500k is low income) housing needs to come to an end. The worst neighbors I've seen were my friend's next door neighbors in Shady Canyon. And my friend in Stonegate hasn't had great neighbor experiences either. Low income and bad neighbors aren't mutually exclusive. I find that people have the same assumptions about living near apartment complexes as well when some people who live in apartment complexes make more money than those who are looking down on them.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: AccidentalAnalytics on July 19, 2021, 08:16:54 AM
I concur it needs to stop: Yet the market will reflect a lower price for homes next to the development than homes away from it. All things equal.

Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: irviniteeee on July 19, 2021, 09:29:00 AM
I concur it needs to stop: Yet the market will reflect a lower price for homes next to the development than homes away from it. All things equal.

Hmm I wonder how much it affects that though. They built some of the priciest homes in Woodbury right next to a low income apartment complex and they still sell in the 2M ballpark. There's also another low income apartment complex closer to the shopping center and the tracts there seem to be doing okay. I guess it's situational.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: AccidentalAnalytics on July 21, 2021, 10:57:32 PM
It’s all situational since you have to account for property type (and square footage) and square footage. I.e. would that $2m house be worth more further away. 
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: CLB_srA on October 22, 2021, 08:33:15 PM
Can anyone shed light on how difficult these are to eventually exit out of?

A close friend of mine got accepted into this and asked me to help underwrite it...
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: fatduck on October 22, 2021, 09:56:01 PM
I doubt it would be too difficult to sell. It's just that your gains will be much lower. Plus the HOA is pretty high.

Just look at the chart of OC median household income growth over time. It's not great.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: CalBears96 on October 22, 2021, 10:52:50 PM
Can anyone shed light on how difficult these are to eventually exit out of?

A close friend of mine got accepted into this and asked me to help underwrite it...

There are limitations. From the article:

For example, owners cannot rent out their property but can sell when they choose — with a few catches.

The maximum sales price can go up only at a rate equal to yearly growth in local incomes. Plus, the future buyers must meet the same income limits, after annual adjustments for inflation.


So, you won't see a lot of gain, and the pool of buyers is limited.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: aquabliss on October 23, 2021, 12:25:56 AM
Tell your friend not to buy this, terrible investment.  My co-worker had one and while we were all gaining crazy equity each year, his value went up only a small amount.  When he wanted to get out later it was difficult to find a buyer and they had to be pre screened for eligibility.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: CalBears96 on October 23, 2021, 12:59:47 AM
Tell your friend not to buy this, terrible investment.  My co-worker had one and while we were all gaining crazy equity each year, his value went up only a small amount.  When he wanted to get out later it was difficult to find a buyer and they had to be pre screened for eligibility.

While it's true that it's not a good investment, it would be a good buy if one plans to live there for a long time. And really, these homes are for the ones who can't afford to buy a normal home, which would cost twice as much, considering the income has to be 20% of the norm income of Irvine.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: aquabliss on October 23, 2021, 08:03:34 AM
Owning this place will cause you angst and animosity for your neighbors outside of the community.  Imagine buying this for $450k then in 20 years, surrounding townhomes same size as yours are selling for $1.5M and you can only sell for $650k.  I guess you knew that going in, but still very frustrating.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: fatduck on October 23, 2021, 11:59:24 AM
Owning this place will cause you angst and animosity for your neighbors outside of the community.  Imagine buying this for $450k then in 20 years, surrounding townhomes same size as yours are selling for $1.5M and you can only sell for $650k.  I guess you knew that going in, but still very frustrating.

but this assumes your alternative option is buying a $1m townhome.  for people who qualify for one of these houses, the alternative is renting.

if you buy one of these low-cost townhomes you're paying like $3k or so a month in mortgage + HOA.  i doubt you can rent a similar townhome in PS for less than that (plus rent goes up every year). 

yea when you sell in the future your gains are capped, but at least you get some limited return on equity.

i really doubt you'd have any difficulty unloading one of these in the future given the level of interest in the initial sales of these.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: HMart on October 23, 2021, 12:54:03 PM
Agree, this is great for people who don't have the income now or in the forseeable future to afford to buy a market rate home. Especially when you look at market rents these days.
Title: Re: 68 Irvine townhomes priced as low as $425,000
Post by: CalBears96 on October 23, 2021, 06:19:14 PM
Owning this place will cause you angst and animosity for your neighbors outside of the community.  Imagine buying this for $450k then in 20 years, surrounding townhomes same size as yours are selling for $1.5M and you can only sell for $650k.  I guess you knew that going in, but still very frustrating.

but this assumes your alternative option is buying a $1m townhome.  for people who qualify for one of these houses, the alternative is renting.

if you buy one of these low-cost townhomes you're paying like $3k or so a month in mortgage + HOA.  i doubt you can rent a similar townhome in PS for less than that (plus rent goes up every year). 

yea when you sell in the future your gains are capped, but at least you get some limited return on equity.

i really doubt you'd have any difficulty unloading one of these in the future given the level of interest in the initial sales of these.

Well, if you qualify to buy one of these homes, that means you can't afford to buy a $1M home.
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