Zippohunter
Member
Goriot said:
Where are you getting your info regarding the significant slowdown? Right now Messina has 1 and Vicenza has 2 quick move in homes.
The slow down is with Cappella with 5 and Saviero with 4 quick move in homes.
Orchard Hills Homes
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Where are you getting your info regarding the significant slowdown? Right now Messina has 1 and Vicenza has 2 quick move in homes.
The slow down is with Cappella with 5 and Saviero with 4 quick move in homes.
Capella has had the worst appreciation out of the entire community. So many on MLS and some are still in the 1.3m price points which isn't far from where they started before. Saviero and Vicenza hasn't really appreciated either.
Amelia on the other hand started at 1.9m and now sells for 2.5m. Now that's appreciaition. Trevi is over 3m.
Amelia on the other hand started at 1.9m and now sells for 2.5m. Now that's appreciaition. Trevi is over 3m.
LongIrvine
Member
How much of the price change has to do with larger lots, cds lots, and view lots?
Zippohunter said:
Info is based on me shopping over there recently. It's not significant but some slowdown relative to earlier. I can just walk in to the sales and have several options right now to go into contract for every development (except TNHC as I haven't talked to them). Also, most of them are flexible with either small price adjustment or design incentives. Few of the prior lots are falling off or fell out of escrow from prior phases due to more competition from Beacon and Greenwood, etc. and losses in the stock market (i.e. one buyer flagged his stock portfolio for cash purchase, but loss big recently and couldn't close). But, I think they are selling well for its price point just not hot as before.
pricedoutJay
New member
Thanks for the info.
Would you mind if I asked you what the requirements were for pre-qual for 1.3 to 1.5 million dollar house? Did you have a lot of cash for down payment from previous sale of your home or did you transfer cash from oversea?
The reason I'm asking is that our income level has now reached high enough for some of these OH homes but we have not saved the 20% downpayment for the over a million dollar homes which has size and amenities that we like to have. I was wondering (since the sales has slowed down a bit) if they'll allow 15% down or other ways for us to even trying to get one these homes that you mentioned...
Would you mind if I asked you what the requirements were for pre-qual for 1.3 to 1.5 million dollar house? Did you have a lot of cash for down payment from previous sale of your home or did you transfer cash from oversea?
The reason I'm asking is that our income level has now reached high enough for some of these OH homes but we have not saved the 20% downpayment for the over a million dollar homes which has size and amenities that we like to have. I was wondering (since the sales has slowed down a bit) if they'll allow 15% down or other ways for us to even trying to get one these homes that you mentioned...
pricedoutJay said:
As of recently, La Vita does not accept Contingent buyers (contingent based on sale of your existing home). Capella, Vicenza and I think Saviero are open to contingent buyers. At $1.3 to $1.5 million, the only choice is Capella at OH as others are all above $1.6mm. Generally, they require a 20% down payment with an approximately 3% deposit upon contract (included as down later) unless you can secure specialized financing that do not require 20% down. As long as your Debt to Income ratio is below 38% or at the highest 40%, they would give you a loan. I believe debt side includes the property tax, insurance, etc. in the numerator. Personally, I will be scared to have the DTI at >=35%. If you have an existing home and aren't able to sell before the close of escrow on your new home, your existing home's mortgage will be calculated as part of your "D"TI which will really hit you hard unless you can lease it out and increase your "I". I think your best strategy is to go into contract as a contingent buyer and sell your home. They will give you 30 days to market your home, 30 additional days to sell with 30 days extension so total of about 3 months to sell your existing home and put the equity towards the down payment on the new home (developer with contingent buyer option).
Just FYI, the underwriter will also require you to have 12 months of cash cushion. So you will probably need 20% + 12 months of cash reserve + DTI below 38%. I was really surprised the jumbo loans are so much cheaper then conforming. Wells Fargo has it 50 bps lower.
I guess it depends on the developer. La Vita and others were Wells Fargo (requires 20% like Perspective mentioned below) as underwriter and Taylor Morrison has it own originator so if you can find originator that require less then 20% down that might work too.
Another aggressive strategy is take out HELOC on your primary mortgage and use that to make downpayment on the new home to give you more time to sell your existing home after buying a new home. However, I doubt you can keep your DTI below the required level based on combined debt unless you can increase your "I" using a creative way=)
Perspective
Well-known member
pricedoutJay said:
There are creditors who'll allow as little as 10% down on jumbo loans ($625K+) that exceed $1M. Wells Fargo doesn't, but others do currently.
Perspective
Well-known member
Goriot shared an important factor most people are unaware of or neglect. Many of these large jumbo loans require as much as twelve months of reserves. This is no small amount.
Perspective
Well-known member
qwerty said:
Yep. You don't necessarily need it liquid. It can be in a brokerage account actively invested and even be in retirement accounts. They'll discount any retirement funds used for reserves by 30%+.
I'm with you though. If you don't have 20% to put down and have ample reserves, then you're not really prepared to buy. If you also have a ton of consumer, auto and student loan debt relative to your income, then you definitely aren't prepared to buy.
Houses are a cash drain, not an "investment." We've already spent a ton in the design center. The backyard will be a huge cash drain. We'll spend a ton decorating too. Great investment, eh? We shall see...
Ready2Downsize
Well-known member
I'm pretty happy with my investment. Definitely going to make a pretty penny on it even with the expenses, upgrades and starting out with interest rates over 6%. Yes, I MIGHT have made more in the right stocks but I would have had to rent something to live in and bottom line it would have not been as good an investment as the house I own now.
Ready2Downsize
Well-known member
My calculations for profit on my 17 year old home which is now paid off:
Included as expenses:
Entire home purchase price
Mortgage payments including principle over the entire life of the loan
Property Taxes over the entire time I've owned the property
HOA over the entire time I have owned the property
Gardener for every month I have had him
Upgrades to the house including flooring (including original and re-carpet, tile), shutters, appliances, built ins (office, entertainment centers, desks, niches), whole house insulation, recessed lights/fans in every room, expoxy garage floors, repaint entire inside/outside, hardscape for approx. 9000 sq foot lot with built in granite counters on the built in bbq with wrap around seating, waterfall, all plants/trees originally put in, new bedding plants thru the years.
Paid off one mello bond thru escrow
Closing costs for original loan and refi
An additional $50K in case I forgot something
_______________________________
less than $1.3 million
Included as Current Value:
Last home sold with this floorplan which backed to a road and no upgrades minus $50K for good measure
Closing Costs
Realtor Commissions
Fixing any defects that happen to be found
_______________________________
a little over $1.9 million
Difference is over $600K, which takes into account everything I've spent on this house.
During this time I would have had to rent something else, gotten no tax deduction and owned nothing.
Leaves me with $1000 per month in expenses for the house plus anything that breaks, no tax consequences taken into account.
Not sure WHAT I can get for $1000 per month these days.
Could have lived under a rock during that time, boiled water for top ramen and instant oatmeal, washed my clothes in the Walmart bathroom and put the money in an SP fund instead of renting I suppose, but I'm ok with how it worked out, all in all.
Included as expenses:
Entire home purchase price
Mortgage payments including principle over the entire life of the loan
Property Taxes over the entire time I've owned the property
HOA over the entire time I have owned the property
Gardener for every month I have had him
Upgrades to the house including flooring (including original and re-carpet, tile), shutters, appliances, built ins (office, entertainment centers, desks, niches), whole house insulation, recessed lights/fans in every room, expoxy garage floors, repaint entire inside/outside, hardscape for approx. 9000 sq foot lot with built in granite counters on the built in bbq with wrap around seating, waterfall, all plants/trees originally put in, new bedding plants thru the years.
Paid off one mello bond thru escrow
Closing costs for original loan and refi
An additional $50K in case I forgot something
_______________________________
less than $1.3 million
Included as Current Value:
Last home sold with this floorplan which backed to a road and no upgrades minus $50K for good measure
Closing Costs
Realtor Commissions
Fixing any defects that happen to be found
_______________________________
a little over $1.9 million
Difference is over $600K, which takes into account everything I've spent on this house.
During this time I would have had to rent something else, gotten no tax deduction and owned nothing.
Leaves me with $1000 per month in expenses for the house plus anything that breaks, no tax consequences taken into account.
Not sure WHAT I can get for $1000 per month these days.
Could have lived under a rock during that time, boiled water for top ramen and instant oatmeal, washed my clothes in the Walmart bathroom and put the money in an SP fund instead of renting I suppose, but I'm ok with how it worked out, all in all.
Perspective
Well-known member
Ready2Downsize said:
As Bones suggests above, keep a detailed record of every dollar you spend on the house so that you can accurately calculate your basis when you sell it so that any profit/loss can be accurately calculated on your "investment."
Most people just think the sale price less the purchase price is the "profit" on their "investment." They don't even factor the commissions, much less all of the thousands spend each year decorating and maintaining the house.
Ready2Downsize said:
I believe you were lucky enough to ride on the leverage bandwagon for the past 40 years with all the asset classes inflating due to increasing credit bubble (I assumed based on your ID - Downsizing assuming that you are 50+). Baby Boomers made it out very very well. However, I feel sorry for the younger folks like myself (Generation X and Millienial) about to jump on the overinflated assets and ride the de-leveraging bandwagon. Primary home should be just a "place" to live and not a speculative investment. However, if you keep the home for 10 years+, you should do pretty well and will usually come on top. Transactions costs of 5%+ plus taxes, maintenance, insurance just chips away too much for a short-term holder to make a significant gain unless you get crazy appreciation like San Francisco. But, I am always on the pessimistic side ofcourse.
Perspective
Well-known member
I think people confuse the questioning of whether a house is an investment, with whether buying a house is a wise financial decision. It certainly is one of the best financial decisions you'll make, when you're financially prepared, over a long holding period.
Robert Shiller and many others have shown that on average, US house prices rise with inflation and maybe exceed it by a point or two, and this does not consider expenses related to the house. There are other investment options available with a much greater return. That doesn't mean you shouldn't buy a house. It means it's not a great investment, on average.
Robert Shiller and many others have shown that on average, US house prices rise with inflation and maybe exceed it by a point or two, and this does not consider expenses related to the house. There are other investment options available with a much greater return. That doesn't mean you shouldn't buy a house. It means it's not a great investment, on average.
Perspective said:
100% Agree --- I think the issue is majority of the buyers don't take these into consideration when making a call on the buy -- Down payment and EMI take up all the focus---- but guess this is more to do with First time buyers.
This after COE sticker shock hit us also (costs definitely keep adding up) --but we didn't have any issue because of having after COE reserves.
paperboyNC
New member
Ready2Downsize said:
Do you think what you experienced can be easily replicated? Are housing prices going to go up as much from 2015 to 2032 as they did from 1998 to 2015? If they did, what would your home cost in 2032?