I get it - you’re a speculator/short term trader instead of an investor when it comes to equity markets. And speculating on appreciation in Irvine RE has been a winning bet. Up here too as my house doubled since we bought it 6 yrs ago. Most RE investors look for positive cash flow from day 1. Banking on future appreciation making up for negative preset value cash flow Is perhaps least risky in Irvine but still risky and the risk reward compared to what is available with investment grade or even slightly below investment grade corporate bonds - some people just gravitate to RE because it’s worked in the past and they think those market dynamics are somehow permanent. But we’re in a new rate cycle and 6-7% mortgage rates are the new normal. Maybe there’s enough cash and desperate financed buyers to keep pushing prices up a few percentage points a year but the return will be much better on that bond especially if rates come down which will be only due to recession signals. An inflationary real estate market will be met with rising rates - the Fed has made that pretty clear. Up here rates have finally driven the San Francisco and San Mateo County medians lower (-3.6 and -1.7% respectively) while Santa Clara Co median is up 2.1%) and the more affordable Contra Cost Co is up 4.7%. Irvine is for sure the least risky OC market but no longer a safe investment due to rates and better yields available in fixed income.
You are assuming that investors are only putting the minimum down of 25%, there are a LOT of investors in Irvine who are cash buyers and high down payment buyers (think 1031 exchange buyers who have to use all of their funds in the exchange). I know for a fact that Irvine will continue to out perform most all it's neighboring cities for many reasons in terms of appreciation. Over the longer term Irvine will appreciate at a rate that will outpace the inflation rate.