Newer Irvine listings with crazy WTF asking prices from equity sellers

CalBears96 said:
sleepy5136 said:
I'm not sure if you checked before, but if you're talking about cash buyers, there aren't that many. But there are a bunch of Mainland Chinese folks that are transferring tons of $$ to scoop up homes here and taking out loans with no income check with 40% down. And also, how many foreign buyers are not Chinese in Irvine? Some areas feel like you live in China.
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Dude, you just don't know what you're talking about, so just stop.
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Imo, it's good to have people come in with other opinions. Most but not all  on this board is opinions anyway.

The guy who taught be how to read stock charts told me one thing in passing 25+ years ago.......... always watch what the Chinese are doing. They are very smart, they watch everything. If you wonder why they would be doing something, there is a reason, keep your eye on things. This was well before they were snatching up properties here, well before China was seen as some economic powerhouse, before we bought absolutely everything from them.

At the very top of the market in 2000, the fiberoptic companies (JDSU had the absolute most amount of engineering talent there was in that day btw, but that talent cashed out their stock options and no longer work or run philanthropic endeavors) were absolutely the rage (along with most everything).

One day some analyst had a phone call with the hedgies and institutions about something "big". He outlined how there was so much demand and product that couldn't keep up that companies were double and triple booking. They were buying from other companies to try to get enough product and their plan was when they got enough to cancel their additional orders and not only that, the telecoms couldn't afford to buy as much as they had orders for and he had the data to prove it. The common thought was they would have to pay "whatever" to get product or they would go out of biz, so they'll come up with the money "somehow".

I knew a hedge fund guy with a fund that had an extremely heavy weight in FO and he said, well it's a little known analyst who doesn't actually cover that area. It didn't really matter. That topped out the FO bigly (and other areas went with it). It turned out his outlier wild accusation was indeed true, orders were tossed and demand was not what it was thought to be.
 
sleepy5136 said:
USCTrojanCPA said:
sleepy5136 said:
CalBears96 said:
sleepy5136 said:
I'm not sure if you checked before, but if you're talking about cash buyers, there aren't that many. But there are a bunch of Mainland Chinese folks that are transferring tons of $$ to scoop up homes here and taking out loans with no income check with 40% down. And also, how many foreign buyers are not Chinese in Irvine? Some areas feel like you live in China.
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Dude, you just don't know what you're talking about, so just stop.
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Do you actually want me to give you proof? Do you even know what you're talking about?

6 Hawkeye, 44% down payment, Adjustable Rate
8 Hawkeye, 67% down payment, Adjustable Rate
18 Hawkeye, 53% down payment, Adjustable Rate
24 Hawkeye, 40% down payment, Adjustable Rate

FYI this is only one street.
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What is your point sleepy?  That these buyers will somehow be forced to sell their homes when their adjustable rates go up?  With 40%+ down, it's easy to be cash flow positive on most Irvine homes.
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Point is these are considered potential shady/junk loans that are being handed out. In the event interest rates go up, there is risk and I'm specifically mentioning homes at the 2m+ range. Assuming sale price of 2m, 40% down payment, 1.2% in taxes (low end), HOA at $150, interest rate at 3.5%, we're looking at 7k+ in rent that is needed to break even. And that's assuming 3.5% interest rate. These loans are adjustable, so if rates go to 4%+, we are looking at 8k in rent to break even.  And also, these loans have no income checked, so you don't know what their finances are. I don't know how easy it is to rent out a place for 7k+ during a high interest rate environment. But if it's easy, then no worries. If not, more inventory will come available in that price range which will stabilize/slow down RE sales at that price range.

This isn't an Irvine specific thing FYI, this is something that can impact any loans that are taken out with no income checked with 40%+ down. It just so happens that it's VERY common in Irvine.
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As stated already, those home purchases have seen a lot of appreciation since they were purchased.  Also, one of the reasons those buyers use those asset based loans is because they can't bring over all of the cash over from China so they get one of those 40-50% loans and then funnel in funds slowly over time.  I've seen this on my listings where I see chunky wires in from a Chinese bank/s into one of the US Chinese bank/s on buyer bank statements.  Think about this, if they have 40-50% down in cash do you really think they don't have more cash sitting in China and/or significant sources of income?  Also, I'd argue that a 50-60% is not a "junk loan" as you call it because the lender has significant downside protection.  So yeah, this is a complete non-issue because the issue that the real estate market is having is high demand which results in low inventory and these foreign buyers only make up a small % of the buyer pool.
 
The only troubles that I see is not able to get any home without bidding aggressively or have enough doughs for the location that I want.

There is no junk loans when you have 40 or 50 % skins in the game. That?s call primo buyers.  :)
 
Non-QM (AKA "Junk Loans") are the fastest growing mortgage product category being funded today. Loans like this are made with 30 percent down or more. The second largest grip of loans funded today are cash out refinances. One needs to ask "Why"?.

Many Non-QM products are in the 5's and some reach into the low 6's for a point or more. These are junk loans to say the least.

2022 is simply 2006 lending redux, missing only the kind of berserk Home Equity Line Of Credit  products that were available at that same time.

As said by Solomon "There is nothing new under the sun..."

PS - I know of a Bank offered No-PMI 3.5% down to loan amounts of $1.5m. Talk about a risky MBS to invest in. Junk is roaring back BAYYY BEEEE!!

My .02c
 
Soylent Green Is People said:
Non-QM (AKA "Junk Loans") are the fastest growing mortgage product category being funded today. Loans like this are made with 30 percent down or more. The second largest grip of loans funded today are cash out refinances. One needs to ask "Why"?.

Many Non-QM products are in the 5's and some reach into the low 6's for a point or more. These are junk loans to say the least.

2022 is simply 2006 lending redux, missing only the kind of berserk Home Equity Line Of Credit  products that were available at that same time.

As said by Solomon "There is nothing new under the sun..."

PS - I know of a Bank offered No-PMI 3.5% down to loan amounts of $1.5m. Talk about a risky MBS to invest in. Junk is roaring back BAYYY BEEEE!!

My .02c
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Lenders loves these loans, aren?t they?
 
Who likes these junk loans? First, I'd say some TBTF financial companies do as they are all but assured of a bailout once the music stops and there aren't enough chairs to go around. Second, any yield starved investment group like insurance companies.

 
https://www.redfin.com/CA/Irvine/59-Hawking-92618/home/167386929?600390594=copy_variant&231528114=control&utm_source=ios_share&utm_medium=share&utm_nooverride=1&utm_content=link&utm_campaign=share_sheet

Another 2 month flip.
 
Maserson said:
https://www.redfin.com/CA/Irvine/59-Hawking-92618/home/167386929?600390594=copy_variant&231528114=control&utm_source=ios_share&utm_medium=share&utm_nooverride=1&utm_content=link&utm_campaign=share_sheet

Another 2 month flip.
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I hate that garage setup.  My wife would scrape the wall half the time she tries to make that turn.
 
Maserson said:
https://www.redfin.com/CA/Irvine/59-Hawking-92618/home/167386929?600390594=copy_variant&231528114=control&utm_source=ios_share&utm_medium=share&utm_nooverride=1&utm_content=link&utm_campaign=share_sheet

Another 2 month flip.
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$785/sf in Altair?  Not gonna happen even in this market.
 
How much do you think this listing will go for?

https://www.zillow.com/homedetails/134-Paxton-Irvine-CA-92620/250511893_zpid/?utm_campaign=iosappmessage&utm_medium=referral&utm_source=txtshare
 
gorams said:
How much do you think this listing will go for?

https://www.zillow.com/homedetails/134-Paxton-Irvine-CA-92620/250511893_zpid/?utm_campaign=iosappmessage&utm_medium=referral&utm_source=txtshare
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My guess is 2.75M easily....corner lot, beautiful front yard and hardscaping at the entrance. It was listed at 2.5M as coming soon, and soon after increased by 100K when another house down the street listed at 2.6M.
 
gorams said:
How much do you think this listing will go for?

https://www.zillow.com/homedetails/134-Paxton-Irvine-CA-92620/250511893_zpid/?utm_campaign=iosappmessage&utm_medium=referral&utm_source=txtshare
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The design choices are so odd to me and seem mismatched...it'll still sell well though.
 
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