Author Topic: When would be next housing Bottom?  (Read 48185 times)

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Offline Panda

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Re: When would be next housing Bottom?
« Reply #330 on: April 19, 2019, 07:02:23 PM »
Attached is the latest inventory chart of Irvine. Just watch to see if the Irvine inventory surpasses 1000 and watch the Orange County unemployment chart I posted earlier. Actually, it may be very healthy for the home prices in Irvine to cool down a bit so that new long waiting buyers can start entering the market at better prices than 2018. I agree with Kenkoko that there is no rush for buyers and the longer they can wait, the sweeter the deal will be.
 




OCLuvr, Are you asking me about Micro (zip codes in OC?) or Macro (across the U.S)



The unemployment in the OC will be a leading indicator. Once you see OC unemployment reach 5%, even "AAA" grade real estate assets like Irvine will start to correct. 





Which places do you expect the crash to be in?




Panda has always been a downer when it comes to Irvine real estate. On the other hand, he thinks Johns Creek will never go bad. :)

Some people can't wait... but it sound like you think Irvine real estate is going to drop even more from here? How much more 10%? 20%? Not even Panda has made that type of prediction.

Panda said he thinks a slow decline of 10-15% in the next 4 years is possible. I am in agreement with that. I see much more downside potential going forward than upside potential. Now is not the time to get in.
« Last Edit: April 20, 2019, 09:49:28 AM by Panda »
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Offline irvinehomeowner

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Re: When would be next housing Bottom?
« Reply #331 on: April 20, 2019, 03:21:41 PM »
Why is over 1000 something to watch for?

It looks like by your chart that in the summer of 2014, it went over 1000 but what were prices at?
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Offline fortune11

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Re: When would be next housing Bottom?
« Reply #332 on: April 20, 2019, 08:40:45 PM »
Why is over 1000 something to watch for?

It looks like by your chart that in the summer of 2014, it went over 1000 but what were prices at?

Yes ... and also ,

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

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Re: When would be next housing Bottom?
« Reply #333 on: April 20, 2019, 10:28:19 PM »
Why is over 1000 something to watch for?

It looks like by your chart that in the summer of 2014, it went over 1000 but what were prices at?

Yes ... and also ,

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

I'd have to check the data but I'm pretty sure that total sales volume increased since 2014 so using a static 1,000 inventory figure as a bench mark becomes less relevant as time moves on.  I believe that months of inventory is the key figure to watch because it tracks both the supply and demand side.
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Offline Kenkoko

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Re: When would be next housing Bottom?
« Reply #334 on: April 20, 2019, 10:41:24 PM »

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

We should definitely pay attention to potential change in the velocity of the market. Which is why I bring up Chinese FCBs because a mass selling in a short period of time will cause market disruption. This happened to Taipei RE (Taiwan) when Chinese pulled money out at rapid pace. RE value dropped 40% in a 5-6 years period. (during a bull market too)

If we are going to talk about population change, we should also mention the rapid change in Irvine demographics. The huge surge of Asian population is unseen in any other coastal area in LA or Orange county.

Irvine is not a wealth concentrated area like real coastal cities like Newport or even Mission Viejo. Look at the age discrepancy of the median Native-born age(25.9) to the median Foreign-born age (42.7) in Irvine. This kind of large gap is no where to be seen at any other city in LA or OC.

Also never hear anyone mention the poverty rate in Irvine is really high at 12.7%.  Yorba Linda is 3.83%, Mission Viejo is 4.75%, Newport is 6.5%.

Median income is probably meaningless for Newport Beach but I don't entirely agree with the notion that median income is meaningless to Irvine.

Offline fortune11

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Re: When would be next housing Bottom?
« Reply #335 on: April 21, 2019, 07:51:50 AM »

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

We should definitely pay attention to potential change in the velocity of the market. Which is why I bring up Chinese FCBs because a mass selling in a short period of time will cause market disruption. This happened to Taipei RE (Taiwan) when Chinese pulled money out at rapid pace. RE value dropped 40% in a 5-6 years period. (during a bull market too)

If we are going to talk about population change, we should also mention the rapid change in Irvine demographics. The huge surge of Asian population is unseen in any other coastal area in LA or Orange county.

Irvine is not a wealth concentrated area like real coastal cities like Newport or even Mission Viejo. Look at the age discrepancy of the median Native-born age(25.9) to the median Foreign-born age (42.7) in Irvine. This kind of large gap is no where to be seen at any other city in LA or OC.

Also never hear anyone mention the poverty rate in Irvine is really high at 12.7%.  Yorba Linda is 3.83%, Mission Viejo is 4.75%, Newport is 6.5%.

Median income is probably meaningless for Newport Beach but I don't entirely agree with the notion that median income is meaningless to Irvine.

That’s a pretty high poverty rate for Irvine ! How does it compare to the national average

As to median vs marginal  ... so many 3 , 4 and 5 plus million homes have sold in Irvine in last 5 years (and not just in shady canyon, I am talking new construction) , that this forum is littered w posts like “for that price I would rather buy in Newport Beach etc etc .... “ .

So, someone is willing  to pay top dollar to live in Irvine (not just FCBs , as was my misperception before I talked to actual people who did the buying in the 3 plus million zone .

Offline misme

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Re: When would be next housing Bottom?
« Reply #336 on: April 21, 2019, 08:10:51 AM »

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

We should definitely pay attention to potential change in the velocity of the market. Which is why I bring up Chinese FCBs because a mass selling in a short period of time will cause market disruption. This happened to Taipei RE (Taiwan) when Chinese pulled money out at rapid pace. RE value dropped 40% in a 5-6 years period. (during a bull market too)

If we are going to talk about population change, we should also mention the rapid change in Irvine demographics. The huge surge of Asian population is unseen in any other coastal area in LA or Orange county.

Irvine is not a wealth concentrated area like real coastal cities like Newport or even Mission Viejo. Look at the age discrepancy of the median Native-born age(25.9) to the median Foreign-born age (42.7) in Irvine. This kind of large gap is no where to be seen at any other city in LA or OC.

Also never hear anyone mention the poverty rate in Irvine is really high at 12.7%.  Yorba Linda is 3.83%, Mission Viejo is 4.75%, Newport is 6.5%.

Median income is probably meaningless for Newport Beach but I don't entirely agree with the notion that median income is meaningless to Irvine.

That’s a pretty high poverty rate for Irvine ! How does it compare to the national average

As to median vs marginal  ... so many 3 , 4 and 5 plus million homes have sold in Irvine in last 5 years (and not just in shady canyon, I am talking new construction) , that this forum is littered w posts like “for that price I would rather buy in Newport Beach etc etc .... “ .

So, someone is willing  to pay top dollar to live in Irvine (not just FCBs , as was my misperception before I talked to actual people who did the buying in the 3 plus million zone .


Irvine has a central location and convenience factor as a major job center that can not be beat for everyday life. Realistically, how often do you go to the beach? Do you want to deal with the AirBnBs and beach going traffic everyday getting to and from your house?

Offline zubs

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Re: When would be next housing Bottom?
« Reply #337 on: April 21, 2019, 02:06:40 PM »
I know a rich Chinese family that owns a rental in Irvine, and a "vacation" home in Newport Coast.  The money they used to buy these 2 properties among other things was difficult to get out of China.  It's hard to believe they would sell these 2 properties after all the shit they went through to get it here in the first place.  Think of all the transaction costs that come up when uncle pooh bear puts a $50,000 annual limit per person.


They already have tons of property in China....the property in the US is additional.  It's a Swiss bank account that can be lived in or rented out.
« Last Edit: April 21, 2019, 02:14:21 PM by zubs »

Offline Kenkoko

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Re: When would be next housing Bottom?
« Reply #338 on: April 21, 2019, 03:57:58 PM »
I know a rich Chinese family that owns a rental in Irvine, and a "vacation" home in Newport Coast.  The money they used to buy these 2 properties among other things was difficult to get out of China.  It's hard to believe they would sell these 2 properties after all the shit they went through to get it here in the first place.  Think of all the transaction costs that come up when uncle pooh bear puts a $50,000 annual limit per person.


They already have tons of property in China....the property in the US is additional.  It's a Swiss bank account that can be lived in or rented out.


Many people are unfamiliar with how wealthy Chinese people got money out of China. Prior to the new capital outflow regulation (2018), Chinese people could get funds out of China as long the funds were tied to their financial holdings in China (used as collateral). What happened was that wealthy Chinese people would pay the bankers to come up with fake appraisals that would allow them to take out 150%, 200%, some even 300% of their actual equity. (Chinese banks are a mixture of private/public business. Very corrupted)

This is one of the top issues that the Chinese government is currently cracking down on. This is also the reason why many of these wealthy Chinese pay money laundering service insane fees like 20% just to get money out. This is also why you see many FCBs, being price insensitive, just throw cash overbidding everyone else.

There’s no point for them to sell their holdings in China because the loan is already way bigger than its real worth.

also FYI, Swiss banks already bowed to pressure and have started to work with the IRS and the Chinese government. It's not the same safe heaven as it was.

Offline irvinehomeowner

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Re: When would be next housing Bottom?
« Reply #339 on: April 22, 2019, 07:16:19 AM »

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

We should definitely pay attention to potential change in the velocity of the market. Which is why I bring up Chinese FCBs because a mass selling in a short period of time will cause market disruption. This happened to Taipei RE (Taiwan) when Chinese pulled money out at rapid pace. RE value dropped 40% in a 5-6 years period. (during a bull market too)

If we are going to talk about population change, we should also mention the rapid change in Irvine demographics. The huge surge of Asian population is unseen in any other coastal area in LA or Orange county.

Irvine is not a wealth concentrated area like real coastal cities like Newport or even Mission Viejo. Look at the age discrepancy of the median Native-born age(25.9) to the median Foreign-born age (42.7) in Irvine. This kind of large gap is no where to be seen at any other city in LA or OC.

Also never hear anyone mention the poverty rate in Irvine is really high at 12.7%.  Yorba Linda is 3.83%, Mission Viejo is 4.75%, Newport is 6.5%.

Median income is probably meaningless for Newport Beach but I don't entirely agree with the notion that median income is meaningless to Irvine.

Yet despite these stats, irvine still fared better during the last downturn and still has premium pricing and demand compared to Yorba Linda and Mission Viejo. Newport Beach is a different animal yet as other posters have mentioned, people still spend as much in Irvine.

There have been quite a few chiming in on why there won't be a major selloff in Irvine by investors/FCBs/etc which seems to hold true based on past experience.

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Offline curious george

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Re: When would be next housing Bottom?
« Reply #340 on: April 22, 2019, 12:54:02 PM »

what has been the population change in the last 6 years ?  Doesn’t that have a bearing also ?

What’s the marginal income change in last 6 years  (top quartile of buyer pool) ? Forget median income, that’s meaningless when it comes to coastal states .

Absolute stats are not as meaningful as “months of inventory “ which accounts for changes in the velocity of the market . I think USC had some good posts on that metric .

We should definitely pay attention to potential change in the velocity of the market. Which is why I bring up Chinese FCBs because a mass selling in a short period of time will cause market disruption. This happened to Taipei RE (Taiwan) when Chinese pulled money out at rapid pace. RE value dropped 40% in a 5-6 years period. (during a bull market too)

If we are going to talk about population change, we should also mention the rapid change in Irvine demographics. The huge surge of Asian population is unseen in any other coastal area in LA or Orange county.

Irvine is not a wealth concentrated area like real coastal cities like Newport or even Mission Viejo. Look at the age discrepancy of the median Native-born age(25.9) to the median Foreign-born age (42.7) in Irvine. This kind of large gap is no where to be seen at any other city in LA or OC.

Also never hear anyone mention the poverty rate in Irvine is really high at 12.7%.  Yorba Linda is 3.83%, Mission Viejo is 4.75%, Newport is 6.5%.

Median income is probably meaningless for Newport Beach but I don't entirely agree with the notion that median income is meaningless to Irvine.

It's happening in vancouver , BC as well.

Offline fortune11

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Re: When would be next housing Bottom?
« Reply #341 on: April 24, 2019, 07:19:32 AM »
As we suspected - a combination of lower rates plus builders getting more aggressive...


U.S. New-Home Sales Rose in March


All U.S. regions but the Northeast saw new-home sales gains last month

https://www.wsj.com/articles/u-s-new-home-sales-rose-in-march-11556028205

Offline Panda

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Re: When would be next housing Bottom?
« Reply #342 on: April 24, 2019, 08:13:49 AM »
James Park, MBA
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Offline Irvinecommuter

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Re: When would be next housing Bottom?
« Reply #343 on: April 24, 2019, 08:51:09 AM »

It's happening in vancouver , BC as well.

Vancouver and Australia are tier 2 destination...they are basically targets now because it is much easier to get visa to Canada and Australia.  Tier 1 FCB came to US...top tier people went NYC, LA/OC, and Bay Area.   

Offline fortune11

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Re: When would be next housing Bottom?
« Reply #344 on: April 24, 2019, 09:20:08 AM »

It's happening in vancouver , BC as well.

Vancouver and Australia are tier 2 destination...they are basically targets now because it is much easier to get visa to Canada and Australia.  Tier 1 FCB came to US...top tier people went NYC, LA/OC, and Bay Area.

Interesting .. when you say tier 2 - do you mean in terms of $$  . Or is it by social strata . Or is it by asset diversification?
Because there were certainly a few more expensive homes being sold in Vancouver than Irvine .

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