Author Topic: Observations from the front lines of the Irvine housing market…  (Read 113139 times)

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Offline blocks

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Re: Observations from the front lines of the Irvine housing market…
« Reply #30 on: November 22, 2010, 11:37:54 PM »
Any one has updates? Very appreciated.

Offline USCTrojanCPA

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Re: Observations from the front lines of the Irvine housing market…
« Reply #31 on: November 23, 2010, 10:07:44 PM »
Been kinda busy lately so please excuse the delay.  I have updated my schedule with the home sale data for October.  Homes sales in Oct. 2010 declined by about 37% from the same time last year (121 sales vs. 192 sales).  The sales for Nov. 2010 through the 22nd are at 119 so we'll have a month-over-month increase in sales volume but there will be a decline from the number of sales in Nov. of 2009.  Prices continue to decline slowly, especially for attached condos.  Even the momentum for new home sales is beginning to slow down.  For instance, current most all new home developments are offering a buyer's agent co-op commission (ranging from $10,000 up to 3%).  One of my buyers was even told by a builder that they are "somewhat negotiable" on their prices and would be willing to provide a credit for closing and/or a credit for some upgrades.  That being said, newer single family residences (1990+) that are priced at/near comps get multiple offers and go into escrow within about a week (examples are 29 Boulder Creek Way in West Irvine and 8 Napa in Northpark).  Inventory levels have declined since the beginning of November from the mid-800s to 755 as of 11/23/10.  This decline will continue until early-to-mid January when inventory levels typically begin to increase.  I would say that the single family home market is neutral while the condo is leaning towards being a buyers market.  Due to the expiration of the tax credits and possible increasing interest rates, I feel that the TIC 2011 Home Collection will not have the same success as their 2010 Collection had.  I think they'll begin to offer buyer agent co-op commissions across the board and other possible incentives like credits for design center upgrades to keep sales going.
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Offline USCTrojanCPA

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Re: Observations from the front lines of the Irvine housing market…
« Reply #32 on: January 05, 2011, 11:37:34 PM »
I have updated my schedule with the home sale data for November and December 2010.  Homes sales in Nov. 2010 declined by about 5% from the same time last year (162 sales vs. 171 sales).  The sales for Dec. 2010 declined by about 21% from the same time last year (148 sales vs. 187 sales).  Inventory levels have been declining since August but at a much slower pace than in 2009.  We'll begin to see inventory levels are to begin to increase in late Jan. to mid Feb.  It'll be interesting to see if we can cross over 900+ homes as we get into the Spring and Summer.  Prices seem to be flat to slightly down with room for negotiation.  Builder incentives has been to increase over the past month or so and they are willing to negotiate so don't settle for list price.  For example, Primrose used to only offer a $15k buyer agent commission and now it is up to 3% based upon their MLS listings and Santa Barbara who used to not have any buyer agent commission is now offering $15k.  As you can see the sales slowdown has hit the condo market a lot more than the SFR market.  Again, SFRs that are priced right and show well still go into escrow within a week or so.  As for interest rates, they popped up about 1/2% from late November/early December to around 4.75%.  If rates keep heading above 5% that may add to the downside press for homes.  2011 will definitely be an interesting year.
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Offline CTNative

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Re: Observations from the front lines of the Irvine housing market…
« Reply #33 on: January 06, 2011, 09:29:36 AM »
I completely agree.

However, I also wonder about the flip side of the coin.  I wonder if the current housing craziness is created partially by the TIC.  Before the 2010 Woodbury collection, the market was still relatively on the down side.  The short sales were actually priced and sold like short sale.  There were no crazy bidding wars on resale homes.  It just seems that starting at beginning of 2010, things started getting crazy.  Maybe it's coincedence and TIC got lucky with the timing or maybe TIC put people into a buying mood with the 2010 Woodbury collection and drove market higher.

I wonder this too. We are all focused on Irvine, but what is happening in the rest of Orange County? If this gravy train TIC sees is real, why aren't developers snatching up land all over OC and throwing up competitive developments, undercutting Irvine on sale prices and skimming off some gravy?

Those developments could skip the HOA and maybe one of the association fees, have lower taxes AND a lower sale price and really do some serious skimming of cash buyers. I KNOW Irvine is a nice place, yes yes...but still, seeing the exact same quality and size house on a wee bit more land for 25% less and lower carrying costs....surely...there would be takers.

So since that is NOT happening, that I am aware of...then it makes Irvine look like an anomaly and something else is in play here.

Offline irvinehomeowner

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Re: Observations from the front lines of the Irvine housing market…
« Reply #34 on: January 06, 2011, 11:46:41 AM »
Summit Ridge in Lake Forest was a new development that undercut Irvine SFRs by quite a bit.

The location itself is fine, just the layout of the neighborhood was a bit of a negative. Yet... it did not sell as fast as any of the New Home Collection... I'm not even sure if they have sold through yet... and they only had less than 30 homes.

Glenwood in Aliso Viejo has been open for years... their prices are also lower than Irvine's yet do not move at the same pace.

Shappell has several projects in Laguna Niguel... also not moving as fast.

Even test's beloved Columbus Grove/Square couldn't match the sales pace (not even sure here... just from my own observation).

Irvine is like a unicorn... everyone wants one because they think they are magical but in reality it's just a horse with an antler dysfunction. Yet people will pay for one just because that's what they want ("Irvine is not for everyone").
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Offline qwerty

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Re: Observations from the front lines of the Irvine housing market…
« Reply #35 on: January 06, 2011, 01:29:00 PM »
Summit CREST in Lake Forest was a new development that undercut Irvine SFRs by quite a bit.

The location itself is fine, just the layout of the neighborhood was a bit of a negative. Yet... it did not sell as fast as any of the New Home Collection... I'm not even sure if they have sold through yet... and they only had less than 30 homes.


Looks like they were down to two homes as of 12/8/10.

http://www.vandaele.com/only-2-homes-remain-in-summit-crest/

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Offline irvinehomeowner

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Re: Observations from the front lines of the Irvine housing market…
« Reply #36 on: January 06, 2011, 02:11:41 PM »
Thanks... Crest, Ridge, Rock, Turtle, Shady... hard to keep it straight.
Once you go 3-car garage... your junk can never go back.
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Offline CTNative

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Re: Observations from the front lines of the Irvine housing market…
« Reply #37 on: January 06, 2011, 10:23:56 PM »
Irvine is like a unicorn... everyone wants one because they think they are magical but in reality it's just a horse with an antler dysfunction. Yet people will pay for one just because that's what they want ("Irvine is not for everyone").

...had me crackin' up with that one.  :) But yeah, I get what you're sayin' (I read your other post on that yesterday).
« Last Edit: January 06, 2011, 10:26:00 PM by CTNative »

Offline USCTrojanCPA

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Re: Observations from the front lines of the Irvine housing market…
« Reply #38 on: February 03, 2011, 10:35:17 PM »
Homes sales in Jan. 2011 actually increased by over 17% from the same time last year (110 sales vs. 94 sales).  Inventory levels have been essentially flat for the entire month of January, but you can bet they will be increasing once we move into the Spring.  Then we have all the new home developments that will be popping up from Portola to Stonegate to Laguna Crossing.  Prices still seem to be flat in January with home prices settling around what recent comps closed around.  The big wild card will be what happens if interest rates on the 30-year mortgage cross into the 5s from the 4s.  Currently we are on the edge of 4.875% and 5%.  It'll be interesting to see what happens if rates creep into the mid-5s as we move into the Spring and Summer.  Will builders start to throw incentives at perspective buyers to lure them in?  Will sellers of re-sale homes begin to lower their prices as inventory and interest rates increase?  It'll be very interesting to see what happens.
« Last Edit: February 04, 2011, 12:40:15 PM by USCTrojanCPA »
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Offline Homer_Simpson

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Re: Observations from the front lines of the Irvine housing market…
« Reply #39 on: February 04, 2011, 08:47:42 AM »
Hoping for more inventory soon  :)
#FARM

Offline qwerty

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Re: Observations from the front lines of the Irvine housing market…
« Reply #40 on: February 04, 2011, 05:15:04 PM »
Homes sales in Jan. 2011 actually increased by over 17% from the same time last year (110 sales vs. 94 sales).  Inventory levels have been essentially flat for the entire month of January, but you can bet they will be increasing once we move into the Spring.  Then we have all the new home developments that will be popping up from Portola to Stonegate to Laguna Crossing.  Prices still seem to be flat in January with home prices settling around what recent comps closed around.  The big wild card will be what happens if interest rates on the 30-year mortgage cross into the 5s from the 4s.  Currently we are on the edge of 4.875% and 5%.  It'll be interesting to see what happens if rates creep into the mid-5s as we move into the Spring and Summer.  Will builders start to throw incentives at perspective buyers to lure them in?  Will sellers of re-sale homes begin to lower their prices as inventory and interest rates increase?  It'll be very interesting to see what happens.

im curious to see the rate impact myself. I keep a spreadsheet of properties that interest me and the wife and i went back to run the payments that were previously calculated using 4.25% with current rates of 4.75% and the payment jumps 150-200/month.  For those folks stretching themselves already its just going to make it that much tougher. It will exert downward pressure - IHO will try to convince us otherwise.

Offline irvinehomeowner

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Re: Observations from the front lines of the Irvine housing market…
« Reply #41 on: February 04, 2011, 05:21:50 PM »
It will exert downward pressure - IHO will try to convince us otherwise.
I don't doubt the downward pressure, I just don't think the decrease will be **directly** proportional to the change in payments based on the rate increase. At least that's what my math says.
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Offline USCTrojanCPA

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Re: Observations from the front lines of the Irvine housing market…
« Reply #42 on: February 05, 2011, 09:47:13 AM »
After Friday's run up of bond yields, we are into the 5s and the only way to get into the 4s on a 30-year fixed is to buy the rate down. 
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Re: Observations from the front lines of the Irvine housing market…
« Reply #43 on: February 05, 2011, 05:36:10 PM »
Beat me to it. We might see mid-5s this year. A return to normalcy.
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Offline USCTrojanCPA

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Re: Observations from the front lines of the Irvine housing market…
« Reply #44 on: February 05, 2011, 05:42:53 PM »
Beat me to it. We might see mid-5s this year. A return to normalcy.
I'm as fast as lightening man.  Btw, I think one of my buddy's might have seen you at the Sevilla Phase 2 release earlier this morning...were you there?
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