Central Park West thoughts?

cvballa

New member
I am looking at a couple of the cheaper 2 bedroom condos at the Central Park West development in the Belvedere building.  One is 1,300 sqft for $389k and the other is 1,550 sqft for $455k.

I know that there will be Mello Roos, but HOAs seem to be kinda fuzzy.  I have heard anywhere from $150 a month to $650 a month.  Anyone have any input on this?

And what do you think of buying here?  I am not in it for the school district as I do not have kids and I believe down the line it will be a good rental for the business type with so much commercial RE in the area and its proximity to the airport. 
 
hah, a rental?  you think you will be able to rent a 2br for enough to break even if you pay $450k, plus have a $500/mo HOA?

I would guess you would need to rent it out for ~$5k/month to make money on that.

 
freedomcm said:
hah, a rental?  you think you will be able to rent a 2br for enough to break even if you pay $450k, plus have a $500/mo HOA?

I would guess you would need to rent it out for ~$5k/month to make money on that.

Wow... ummm... harsh and a gross exaggeration right out of the gate.

First off even if I buy the $455k one with a 5% interest rate the mortgage would be $2,369 a month.  So I would be geting close $3,000 a month with taxes, insurance and HOAs.  Maybe slightly more in the worst case scenario.

So no I don't think I could rent it out for $5k a month.  But min $2k and probably closer to $2,500 on a 1550 sqft new place.

And I do not plan to rent it out soon.  I am talking 3-5 years down the line which would be a better rental market. 

Obviously the numbers get better on the lower priced place.
 
let's say taxes + MR = ~1.8%, so @$450k = $810, and insurance @ 0.3% = $125/mo

so $2400 + $550 + $810 +$125 = $3885

okay, its not 5 large, but I'm guessing the HOA isn't going down.  So if a nearby rental is ~$2500, then you are only 1.6X market.

if you want to buy, fine, its your money.  just don't tell us that you will be making money renting it out.
 
Central Park West is a disaster: close to 405, dense and in Santa Ana school district. The high rise buildings around that area has the highest vacancy rate in OC.

For $389k, I'd rather buy a 2 bed room place at Woodbury.

 
freedomcm said:
let's say taxes + MR = ~1.8%, so @$450k = $810, and insurance @ 0.3% = $125/mo

so $2400 + $550 + $810 +$125 = $3885

okay, its not 5 large, but I'm guessing the HOA isn't going down.  So if a nearby rental is ~$2500, then you are only 1.6X market.

if you want to buy, fine, its your money.  just don't tell us that you will be making money renting it out.

Thanks you.  This is an example of a great post.  I like how you broke it down.  From the looks of it I am only going to be able to afford the lower priced one.

I have a question though, how do you come up with the 1.8% tax rate?  My best friend just bought in Woodbury East and is paying 1.6%.  Wouldn't CPW be the same? I honestly don't know, I am just assuming.

And when I rent it out I dont plan to be cash flow positive soon, and I plan to live in it for the next few years.

That $550 HOA number is giving me the chills and making me have second thoughts.
 
regular county property taxes are typically 1.05%, the remainder is variable based upon what the mello roos for each location.
 
I think CPW's MRs and 1915 funds would be higher. Plus wasn't there some reduction in WB or WBE supplemental taxes by TIC?
 
irvinehomeowner said:
I think CPW's MRs and 1915 funds would be higher. Plus wasn't there some reduction in WB or WBE supplemental taxes by TIC?

So do you think 1.6% or 1.8% is more realistic?
 
After compiling the numbers it seems like even on the cheapest place with 10% down my total monthly outgo would be close to $3,200 which I think I could do, but is not something I am willing to do.  I would not buy there if my monthly outgo was over $3,000.

I am a partner at an investment firm and I am a bear on housing for the first half of the year as forclosure activity picks back up.  So I am hoping that Lennar drops prices around 5% or so.  What are the odds on this based on their track record for this and other projects?  And what are the odds the HOAs are adjusted downward to entice buyers (I know their emails have meantioned 1 year of HOAs paid for, which still wouldnt make me bite).

In addition I did recieve an email recently that showed lower prices for the Belvedere condos than are listed on the site (about 2-3% lower).  Could this just have been a mistake or something indicating they are planning to lower prices soon?
 
CV, here is my thoughts on Central Park West....DON'T BUY THERE!!!  If you are planning on the purchase becoming a rental in the near future, why not consider buying a property in a city outside of Irvine where the numbers pencil out better?  If you are dead set on buying in Irvine, take a look at other areas such as Oak Creek, Northpark, Northwood Pointe, etc. 
 
I'm not sure there are many homes you can buy in Irvine that can become cash flow positive rentals in the future unless you are buying with a lot of cash down.

But I would stick with something in the IUSD or even closer to UCI that way you can expand your prospective renters beyond just the young urban type to a small family or students (well... maybe not students :D ).
 
irvinehomeowner said:
I'm not sure there are many homes you can buy in Irvine that can become cash flow positive rentals in the future unless you are buying with a lot of cash down.

But I would stick with something in the IUSD or even closer to UCI that way you can expand your prospective renters beyond just the young urban type to a small family or students (well... maybe not students :D ).
There are attached condos in Northpark that are getting into the $270/sf range which isn't that far from rental parity (I think $250/sf in Irvine is where you'll get near rental parity with 20-25% down, depends upon the HOA and Mello Roos).  It's probably fair to estimates that rents will rise 2-3% a year (higher if inflation takes off) if we don't get a double dip recession.  Always budget 1-months worth of vacancy and repairs & maintenance in your rental proforma. 
 
USCTrojanCPA said:
CV, here is my thoughts on Central Park West....DON'T BUY THERE!!!  If you are planning on the purchase becoming a rental in the near future, why not consider buying a property in a city outside of Irvine where the numbers pencil out better?  If you are dead set on buying in Irvine, take a look at other areas such as Oak Creek, Northpark, Northwood Pointe, etc.

My main motivation is that I like the urban lifestyle that CPW offers.  There are definitely drawbacks on price, but I do not expect to make money as a rental soon, but I also don't want to eat $1000 month if I rent it out.  I can handle eating $200-300 a month.  Any ideas of an alternative urban living situation in south orange county?

Also, does anyone know if the $400 HOA for the building covers anything like trash, water, etc?
 
If you want "urban" why Irvine? Nothing is really walking distance from CPW except a Fat Burger, a Sports store, and a Wahoo's Fish Taco. You're over paying for false urbanity. That's like paying full price for a fake LV purse.
 
cvballa said:
Any ideas of an alternative urban living situation in south orange county?

The only other urban areas in OC are the Platinum Triangle, Tustin Legacy and South Coast Metro.
 
IndieDev said:
If you want "urban" why Irvine? Nothing is really walking distance from CPW except a Fat Burger, a Sports store, and a Wahoo's Fish Taco. You're over paying for false urbanity. That's like paying full price for a fake LV purse.

I know the urbanality of it is weak now, but I am assuming when CPW is fully built out they will have commercial spaces that have some pretty good stores.  I know they do not plan to have those bulit for a few years though, which is disappointing.
 
cvballa said:
IndieDev said:
If you want "urban" why Irvine? Nothing is really walking distance from CPW except a Fat Burger, a Sports store, and a Wahoo's Fish Taco. You're over paying for false urbanity. That's like paying full price for a fake LV purse.

I know the urbanality of it is weak now, but I am assuming when CPW is fully built out they will have commercial spaces that have some pretty good stores.  I know they do not plan to have those bulit for a few years though, which is disappointing.

Exactly. A few years, which could easily turn into 4-5. If I were you, I'd bank that money in something that actually makes money (excluding muni bonds, there's been a run on those lately). Then go and buy the unit you want at 50% of the price later on. CPW is about as bad a failure of a project as North Korean towers. It's a relic of an economic era that will never return.
 
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