rental value of a 3/2.5 detached 1700 sq ft. condo portola

how much do you think a 3/2.5 detached 1700 sq ft. condo in portola springs would rent for?

  • $2300 or less

    Votes: 10 21.3%

  • $2400

    Votes: 14 29.8%

  • $2500

    Votes: 12 25.5%

  • $2600

    Votes: 2 4.3%

  • $2700

    Votes: 2 4.3%

  • $2800 or more

    Votes: 7 14.9%
  • Total voters
    47
V

villiagepeople

New member
craigslist 3bd =  $2.2k-$3k
rental-living.com 3bd = 2k-3k
portola place 2bd = $2,170+ (the one w/ a den doesn't show a price)

above are the prices i can find for something close to a 3/2.5 detached 1700 sq ft. condo...  and i'm trying to do my due diligence on "rental parity".  my question is what do you think a 3 bed, 2.5 bath, 2-story, detached condo (with wood floors, upgraded cabinets, granite, fridge and washer/dryer)  would go for?  also let's throw in the fact that it's new (i was living at the village when the park came out and the prices were a lot higher... so i'm assuming there is a premium for new).  now i know a lot of you may say that i can't count the fact that it's new, cause i'll be living in it, and when i rent it won't be new... but that's not what i'm doing, all i'm trying to find out is it's value, "right now", and how much i may be over paying.  thank you for your thoughts.

 
I think rule of thumb for rentals in Irvine:

2br $2k-ish
3br $2.5k-ish
4br $3k-ish
5br $3.5k-ish

You can check IrvineRealtor's spreadsheet for a more accurate breakdown and these fluctuate based on age, location, square footage and amenities.
 
irvinehomeowner said:
I think rule of thumb for rentals in Irvine:

2br $2k-ish
3br $2.5k-ish
4br $3k-ish
5br $3.5k-ish

You can check IrvineRealtor's spreadsheet for a more accurate breakdown and these fluctuate based on age, location, square footage and amenities.
Click to expand...

That's dismal. In PS, $2,500 would barely cover the monthly principal, and HOA with 20% down on the cheapest 3BR Sevilla model.
 
IndieDev said:
irvinehomeowner said:
I think rule of thumb for rentals in Irvine:

2br $2k-ish
3br $2.5k-ish
4br $3k-ish
5br $3.5k-ish

You can check IrvineRealtor's spreadsheet for a more accurate breakdown and these fluctuate based on age, location, square footage and amenities.
Click to expand...

That's dismal. In PS, $2,500 would barely cover the monthly principal, and HOA with 20% down on the cheapest 3BR Sevilla model.
Click to expand...
Just remember, it's Irvine, all-cash down obliterates rental parity.  :p
 
Oh right, the Chindian Financing Model (CFM), opportunity cost of all-cash purchases ignored of course.
 
IndieDev said:
Oh right, the Chindian Financing Model (CFM), opportunity cost of all-cash purchases ignored of course.
Click to expand...
Come on man, you know that rental parity is thrown out the window in Irvine.

Btw, that 1,700sf detached condo should rent for around $2,500sf (+/- 1.50/sf).
 
USCTrojanCPA said:
IndieDev said:
Oh right, the Chindian Financing Model (CFM), opportunity cost of all-cash purchases ignored of course.
Click to expand...
Come on man, you know that rental parity is thrown out the window in Irvine.

Btw, that 1,700sf detached condo should rent for around $2,500sf (+/- 1.50/sf).
Click to expand...

Of course. It's been like that since the late 90s.

It's just that in the past two weeks, we've had one poster who wants to buy two rental properties in Irvine, and another one asking about rental parity on a development that has a 1.7% effective tax rate. "Rental property in Irvine" to me seems synonymous with "burning money in a wood fire". I don't get it. Is there something I'm missing?
 
IndieDev said:
USCTrojanCPA said:
IndieDev said:
Oh right, the Chindian Financing Model (CFM), opportunity cost of all-cash purchases ignored of course.
Click to expand...
Come on man, you know that rental parity is thrown out the window in Irvine.

Btw, that 1,700sf detached condo should rent for around $2,500sf (+/- 1.50/sf).
Click to expand...

Of course. It's been like that since the late 90s.

It's just that in the past two weeks, we've had one poster who wants to buy two rental properties in Irvine, and another one asking about rental parity on a development that has a 1.7% effective tax rate. "Rental property in Irvine" to me seems synonymous with "burning money in a wood fire". I don't get it. Is there something I'm missing?
Click to expand...
It's essentially someone who wants to put their money into something that they see as very safe (i.e. a treasury bond paying 2-3%) versus taking on a little more risk and getting a higher return (i.e. corporate investment grade bond earning 5-6%).  I don't see buying an attached condo with high Mello Roos and/or HOA has being all that safe, even in Irvine.  Honestly, pick up one of those older SFRs in old Northwood with no Mello Roos and little to no HOA dues. 
 
IndieDev said:
"Rental property in Irvine" to me seems synonymous with "burning money in a wood fire". I don't get it. Is there something I'm missing?
Click to expand...

well, i'm not looking to rent it.. but i do think that prices will float to "near" rental parity... and i know i may be over paying, just trying to figure how much and how long before it gets there...

so just using rough numbers here.. and let's assume sevilla plan 1...

532k - ~30% down (that's how much i'm putting down because of dti and cause i want the best rate)
that will leave me with roughly a 372k loan 30yr @5% = 1997
+ 443 prop tax + 310 mello roos + 40 insurance + 244 hoa
PITI = 3035
- 445 principle (forced savings?)
- 388 (1552 in interest @25% tax deduction)
- 110 (443 prop tax @25% tax deduction)
+ 206 (opportunity cost, ~1.5% int. on savings, after tax on 165k)

~ $2300 (my rent parity)

i know about maintainence reserves, but this is a new home... so i hope w/ the 10yr warranty i won't have to worry about that... am i missing something?  did i do the calcs wrong?
 
IndieDev said:
irvinehomeowner said:
I think rule of thumb for rentals in Irvine:

2br $2k-ish
3br $2.5k-ish
4br $3k-ish
5br $3.5k-ish

You can check IrvineRealtor's spreadsheet for a more accurate breakdown and these fluctuate based on age, location, square footage and amenities.
Click to expand...

That's dismal. In PS, $2,500 would barely cover the monthly principal, and HOA with 20% down on the cheapest 3BR Sevilla model.
Click to expand...

It is difficult to be cash flow positive with 20% down.  I always recommend 100% down.
 
USCTrojanCPA said:
IndieDev said:
USCTrojanCPA said:
IndieDev said:
Oh right, the Chindian Financing Model (CFM), opportunity cost of all-cash purchases ignored of course.
Click to expand...
Come on man, you know that rental parity is thrown out the window in Irvine.

Btw, that 1,700sf detached condo should rent for around $2,500sf (+/- 1.50/sf).
Click to expand...

Of course. It's been like that since the late 90s.

It's just that in the past two weeks, we've had one poster who wants to buy two rental properties in Irvine, and another one asking about rental parity on a development that has a 1.7% effective tax rate. "Rental property in Irvine" to me seems synonymous with "burning money in a wood fire". I don't get it. Is there something I'm missing?
Click to expand...
It's essentially someone who wants to put their money into something that they see as very safe (i.e. a treasury bond paying 2-3%) versus taking on a little more risk and getting a higher return (i.e. corporate investment grade bond earning 5-6%).  I don't see buying an attached condo with high Mello Roos and/or HOA has being all that safe, even in Irvine.  Honestly, pick up one of those older SFRs in old Northwood with no Mello Roos and little to no HOA dues.
Click to expand...

I understand that Irvine home buyers are great savers but not necessarily great investors, but Sevilla or any of the Woodbury/PS homes are simply awful places to hedge right now. The numbers don't make sense even with 50% down simply because mortgage rates are so low that the opportunity cost of hedging 100% in housing can get enormous.
 
villagepeople said:
~ $2300 (my rent parity)
Click to expand...
Thanks for your breakdown post. I was going to point out to IndieDev that in your case you are not looking for rental parity as an investment reason but as your own reason to own vs rent.

Just remember that in your equations, you should factor in the lost opportunity cost of your down payment. While interest rates are low, that is probably small... but renters don't have to put down a $200k deposit when they rent.

As for maintenance reserves, there are things that the new home warranty does not cover so you still may want to consider that in your numbers. And the 10-year only covers structural issues (I believe) so keep that in mind.

In the end, as long as you budget properly, have stable employment and don't expect massive appreciation in the next 5-10 years... buying isn't a bad idea (disclaimer: I am also planning to buy this year if we see somethine we like).

I think the question that people are asking is "what" to buy.

Personally, I'm not totally sold on detached condos because just like attached homes, they tend to be more volatile... even in Irvine. And I really do think that Las Ventanas, even next to the toll road, being a traditional detached SFR with a driveway, will cause some pressure on the surrounding projects.

That being said... we can probably only afford a detached condo in Laguna Altura and will buy one if it suits us... heh.
 
villagepeople said:
IndieDev said:
"Rental property in Irvine" to me seems synonymous with "burning money in a wood fire". I don't get it. Is there something I'm missing?
Click to expand...

well, i'm not looking to rent it.. but i do think that prices will float to "near" rental parity... and i know i may be over paying, just trying to figure how much and how long before it gets there...

so just using rough numbers here.. and let's assume sevilla plan 1...

532k - ~30% down (that's how much i'm putting down because of dti and cause i want the best rate)
that will leave me with roughly a 372k loan 30yr @5% = 1997
+ 443 prop tax + 310 mello roos + 40 insurance + 244 hoa
PITI = 3035
- 445 principle (forced savings?)
- 388 (1552 in interest @25% tax deduction)
- 110 (443 prop tax @25% tax deduction)
+ 206 (opportunity cost, ~1.5% int. on savings, after tax on 165k)

~ $2300 (my rent parity)

i know about maintainence reserves, but this is a new home... so i hope w/ the 10yr warranty i won't have to worry about that... am i missing something?  did i do the calcs wrong?
Click to expand...

I'm getting about the same numbers. Your opportunity cost are slightly off though. Any gain from investing that 445 principle number, and loss from not being able to invest the tax and interest, should be added to the opportunity cost column. Also, your opportunity cost on 165k are only 1.5% if you're simply saving the money in a bank.

To put a more succinct point on it I had more than you are putting into a Sevilla condo into boring blue chip.  Altria (MO) paying 6.2% (horribly undervalued because people shy away from tobacco companies),  Alliance resource (ARLP) at 5%, Brystol Meyers (BMY) at 4.8% (gotta have a good drug company in the portfolio), and Verizon at 6%. I made over $20,000 just sitting my money into stable, boring companies. The chances of you turning a $20,000 profit per year from renting a Sevilla Plan 1 are about 0 to none.

I'm no day trader either, I'm simply someone who likes boring, stable investments like any fiscally conservative person.
 
test said:
IndieDev said:
irvinehomeowner said:
I think rule of thumb for rentals in Irvine:

2br $2k-ish
3br $2.5k-ish
4br $3k-ish
5br $3.5k-ish

You can check IrvineRealtor's spreadsheet for a more accurate breakdown and these fluctuate based on age, location, square footage and amenities.
Click to expand...

That's dismal. In PS, $2,500 would barely cover the monthly principal, and HOA with 20% down on the cheapest 3BR Sevilla model.
Click to expand...

It is difficult to be cash flow positive with 20% down.  I always recommend 100% down.
Click to expand...

Dude that's awesome. You even had enough to buy a camel.
200965

 
It's a good down payment on a used Porsche though. I've been looking at a dark blue Carrera at Power Porsche in Newport to replace my somewhat aging 528i.
 
IndieDev said:
It's a good down payment on a used Porsche though. I've been looking at a dark blue Carrera at Power Porsche in Newport to replace my somewhat aging 528i.
Click to expand...

I recommend you get a GT3 instead.  Carrera is like a Honda Civic, everyone has one.
 
Patrick Star said:
irvinehomeowner said:
That being said... we can probably only afford a detached condo in Laguna Altura and will buy one if it suits us... heh.
Click to expand...

Why are you so hung up on Irvine, IHO?  I mean, its a great place and all --- I was happy to call it home for 5 years.  But dude, you know what you WANT. And it is not a detached condo.  I knew what I wanted.  And it just was not happening for my budget in Irvine.  And does not seem to be for you, either?  So please, please tell me what is so holy about Irvine that you would be not be willing to compromise *just a little* on the location? 

I'm here to tell you, IHO --- life does exist outside of Irvine.  It really does.  As a matter of fact, Mrs. Star and I giggle all the time about how happy we are to have broken the cycle.  Now that we can see the other side we are kicking ourselves for having wasted those 5 years.  IHO, the ONLY thing we are missing in our new neighborhood is 85C.  We have everything and anything we ever had in Irvine.  Everything.  Every chain restaurant.  Every Asian food option (but 85C).  Every shopping option.  Heck, even LV, Gucci, Tiffany and such about the same distance as SCP. And besides, we never really went to 85C that much, anyway.  And if we ever feel the need, we have a car!  Imagine that.  And you would have those same options in somewhere like Ladera Ranch, Aliso Viejo, Laguna Niguel, Anaheim Hills, Yorba Linda, Serrano Heights...you get the idea.

Now I bet you are going to reply "but the schools, the SCHOOLS".  I hate to tell you, but as big a fan of the Irvine schools as I was, I realize now it was a bunch of hype.  Little Miss Star had 34 kids in her class this year at Myford.  34! (I hear you IUSD folks are seeing similar numbers?). AND it was a 1-2 combo class.  What kind of crap is that?  Now she attends an LAUSD school and has 25. 25! WTF?!  LAUSD?! And it has the same damn API as her previous school --- WTF again?!  What was I paying for?! Have you checked up on Chaparral Elem in Ladera?  And now I suppose you are going to say "But but but I can have lunch with my kids!"  Yeah dude, tell me how often they are going to want to do that in a couple of years. 

So, please tell me why I should have paid $300k more for my house in Irvine?  Actually, a Westpark II tract version of my house with 5 adjoining backyards would cost $300k more.  If you stuck it up in Turtle Ridge where you could get the view lot, I don't even want to think about it.  And for what?  Really, what? 

And all lovers of Irvine, I am not hating on the city.  It is a fine place, and if our budget and our desired house had met at a crossroads in Irvine, we would have stayed there forever.  But they did not. And at the end of the day, the level of compromise just to live in Irvine was just not worth it.  $300k is a steep price to pay to have an 85C five minutes away.  If you've got the coin to afford Irvine and want to live there,  but all means --- go for it.  But if you don't have that $$ but still aspire for something more (like IHO), really, really think about the level of sacrifice you would need to make for that Irvine address, and what you really get in return.

Help me help you, IHO.  Help me help you.
Click to expand...
It's an easy question to answer really... location, location, location.

Anything south is farther from my work and her relatives, anything north is farther from her work and my relatives. We don't have the flexibility of changing the location of our jobs and we don't have family/friends in more affordable areas outside of Orange County.

I hate commuting. I hate living far from work. As I get older, I also am having more medical appointments and it's nice to be able to do that close to work and home. I pick up or drop off the kids... can't do that if I work over 30 minutes from their school. In the past few months, I've actually tested the drive from some South County cities... and even without traffic... it just takes too long. Again... 20 minutes more may not mean much to others... but that's 40 minutes total and could be more. Have you ever been on Oso during peak times? It's as bad as Culver!

And while I can play ball in many other parks in Orange County... I have established friendships with guys in Irvine going over a decade back (or longer). I like being able to wake up at 7:45am to play ball only 5 minutes away with guys who I've known for a long time. My wife likes having her friends 5 minutes away when she need to borrow something. We like the local hangouts and restaurants in Irvine (although we aren't too keen on the Mexican and Italian food choices)... we've lived here for many years... and it's our home. We've lived outside of Irvine for 3 years... and always wanted to come back... for us... that's just how it is.

Even my wife said she doesn't want to move to any other city if I'm always going to be hanging out in Irvine or wishing we lived there. A good comment from her was "Sure... we live in a big house but it won't be fun because you'll always be looking at prices in Irvine and saying... we could have bought that instead"... I'm OCD that way and she knows it.

The question we always have is "big house or preferred location?". Sure... we want a big house... but we don't NEED a big house. We do NEED a preferred location. And if I am going to give up size... at least give me one thing that QH and LA have to offer... an elevation.
 
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