Where are we headed?Irvine home prices?

Mety said:
This is a very interesting point.
So if FCBs decided to sell their US homes, would this hit Irvine hard?
I thought the majority of the buyers in Irvine are people living here with 20% or more downpayment. Even though there are good number of FCBs, I never thought they were the majority. Is this not true?
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I think If China can achieve soft landing (instead of the nose dive trajectory they are currently on) and US economy stays strong, this would not have much of an impact. If China crashes hard and US economy softens, I see a sizable move down quickly.

If you look at the rental market for newly built homes in Irvine, you'd realize that there are a lot of these cash buyers.
I just helped my cousin rent a newly built Eastwood home for $3550/month. The home was recently sold for 1.02 mil.
The owner would be paying over $2000 a month just on property taxes + HOA + insurance + realtor commission.
I do not know for sure but this is most likely a cash bought home. It would make no financial sense to do this with a mortgage.
And there are a lot of these on the rental market.

 
Ken the street fighter speaks the truth. Thanks for sharing. It puts it in perspective regarding the fcb.
 
Kenkoko said:
Mety said:
This is a very interesting point.
So if FCBs decided to sell their US homes, would this hit Irvine hard?
I thought the majority of the buyers in Irvine are people living here with 20% or more downpayment. Even though there are good number of FCBs, I never thought they were the majority. Is this not true?
Click to expand...
I think If China can achieve soft landing (instead of the nose dive trajectory they are currently on) and US economy stays strong, this would not have much of an impact. If China crashes hard and US economy softens, I see a sizable move down quickly.

If you look at the rental market for newly built homes in Irvine, you'd realize that there are a lot of these cash buyers.
I just helped my cousin rent a newly built Eastwood home for $3550/month. The home was recently sold for 1.02 mil.
The owner would be paying over $2000 a month just on property taxes + HOA + insurance + realtor commission.
I do not know for sure but this is most likely a cash bought home. It would make no financial sense to do this with a mortgage.
And there are a lot of these on the rental market.
Click to expand...

Agreed that the higher-end homes are renting cheap. I looked at selling my home and renting a $2 million home for around $6,000/mo. With daughters, I don't like the possibility of having to move after a year lease is up. And if I don't want to spend more money, I could end up having to "move down".
 
paperboyNC said:
Kenkoko said:
Mety said:
This is a very interesting point.
So if FCBs decided to sell their US homes, would this hit Irvine hard?
I thought the majority of the buyers in Irvine are people living here with 20% or more downpayment. Even though there are good number of FCBs, I never thought they were the majority. Is this not true?
Click to expand...
I think If China can achieve soft landing (instead of the nose dive trajectory they are currently on) and US economy stays strong, this would not have much of an impact. If China crashes hard and US economy softens, I see a sizable move down quickly.

If you look at the rental market for newly built homes in Irvine, you'd realize that there are a lot of these cash buyers.
I just helped my cousin rent a newly built Eastwood home for $3550/month. The home was recently sold for 1.02 mil.
The owner would be paying over $2000 a month just on property taxes + HOA + insurance + realtor commission.
I do not know for sure but this is most likely a cash bought home. It would make no financial sense to do this with a mortgage.
And there are a lot of these on the rental market.
Click to expand...

Agreed that the higher-end homes are renting cheap. I looked at selling my home and renting a $2 million home for around $6,000/mo. With daughters, I don't like the possibility of having to move after a year lease is up. And if I don't want to spend more money, I could end up having to "move down".
Click to expand...

But does that mean Irvine's majority population is FCB? I just want to know if anyone knows who is the majority of owners in Irvine. I thought it was the families with kids actually living in this country.
 
paperboyNC said:
Agreed that the higher-end homes are renting cheap. I looked at selling my home and renting a $2 million home for around $6,000/mo. With daughters, I don't like the possibility of having to move after a year lease is up. And if I don't want to spend more money, I could end up having to "move down".
Click to expand...
Yeah, I think the potential of having to move is a no no for a lot of people. Explains why rental demand for these higher end homes are low. I probably would have done it if I was in my 20s like my cousin.

We were actually offered a two year lease at $150/month discount. (price was $3700 for 1 year lease and $3550 for 2 year) We did have to pony up 2 months of security deposit tho.
 
eyephone said:
Ken the street fighter speaks the truth. Thanks for sharing. It puts it in perspective regarding the fcb.
Click to expand...
Hopefully there's no sarcasm in there. Glad I can provide some perspective since I am from a FCB family.
This stuff is all we talk about at large family gatherings. 
 
This is funny. Back in 08, no one really thought the FCB existed much less had an impact on the Irvine real estate market.

Today, many think the Irvine market hinges on the FCB.

But I don't think the FCB will sell "en masse"... a lot of people here keep talking about China but China is not the only FCB that buys in Irvine. There is plenty of Middle East, non-Chinese Asians, and a huge contingent of DMBs that buy and stay in Irvine.

I'll let you guys figure out what DMB is. That will be my new acronym for my 10-year anniversary with IHB/TI.
 
Don?t always believe what you read. Look how much money was spent on measure B and it didn?t pass.

lnc said:
According to CoreLogic?s report out this morning, home price is up 6.8% year-over-year nationally and also project price increase of 5.1% year-over-year increase from June 2018 to June 2019.

Looks like they expect the home price continue to increase nationally for the next 12 month but just not as much as prior year.

https://www.corelogic.com/news/core...identify-affordability-as-biggest-hurdle.aspx
Click to expand...
 
irvinehomeowner said:
This is funny. Back in 08, no one really thought the FCB existed much less had an impact on the Irvine real estate market.

Today, many think the Irvine market hinges on the FCB.

But I don't think the FCB will sell "en masse"... a lot of people here keep talking about China but China is not the only FCB that buys in Irvine. There is plenty of Middle East, non-Chinese Asians, and a huge contingent of DMBs that buy and stay in Irvine.

I'll let you guys figure out what DMB is. That will be my new acronym for my 10-year anniversary with IHB/TI.
Click to expand...

dunder mifflin babies

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irvinehomeowner said:
This is funny. Back in 08, no one really thought the FCB existed much less had an impact on the Irvine real estate market.

Today, many think the Irvine market hinges on the FCB.

But I don't think the FCB will sell "en masse"... a lot of people here keep talking about China but China is not the only FCB that buys in Irvine. There is plenty of Middle East, non-Chinese Asians, and a huge contingent of DMBs that buy and stay in Irvine.

I'll let you guys figure out what DMB is. That will be my new acronym for my 10-year anniversary with IHB/TI.
Click to expand...

Downsizing MAGA Boomers?

I kinda agree with your opinion. I don't think FCBs selling their homes will impact too much on the market in Irvine. I think there are plenty of other people willing to buy their homes.


 
Mety said:
I kinda agree with your opinion. I don't think FCBs selling their homes will impact too much on the market in Irvine. I think there are plenty of other people willing to buy their homes.
Click to expand...

Agree. At current price level and the current state of the US economy, A FCB selloff would not have much of an impact.

But I also do not think it's the best time to invest in Irvine RE right now. Because I just do not see a lot of factors that can push price up significantly in the near future.
Even if Irvine trends up 2-3% every year for the next 3-5 years, the 5% transaction cost when you sell, the low rent in Irvine, and the high taxes will heavily eat into your profits. The US economy is strong and there are many other better opportunities out there.
Heck, even a Discover 12 months CD is yielding 2.25% right now. Lower risk investment with no carrying cost and no 5% transaction cost when you take your money out.

 
USCTrojanCPA said:
The thing that Irvine has going for is that the non-Great Park build-out will be completed in the next 3-5 years (Orchard Hills, Portola Springs, and Eastwood).  Once that happens more and more potential new home buyers will be forced to enter the resale market. 
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And those buyers will be more likely to remodel! (Shameless interior design plug) :)

Actually, the plus side of remodeling an older home is that generally you'll get more value from it versus paying builder markup on a new home.
 
kbinteriordesign said:
USCTrojanCPA said:
The thing that Irvine has going for is that the non-Great Park build-out will be completed in the next 3-5 years (Orchard Hills, Portola Springs, and Eastwood).  Once that happens more and more potential new home buyers will be forced to enter the resale market. 
Click to expand...

And those buyers will be more likely to remodel! (Shameless interior design plug) :)

Actually, the plus side of remodeling an older home is that generally you'll get more value from it versus paying builder markup on a new home.
Click to expand...

True, you just have to find good contractors to help you (which can be tough today).
 
USCTrojanCPA said:
kbinteriordesign said:
USCTrojanCPA said:
The thing that Irvine has going for is that the non-Great Park build-out will be completed in the next 3-5 years (Orchard Hills, Portola Springs, and Eastwood).  Once that happens more and more potential new home buyers will be forced to enter the resale market. 
Click to expand...

And those buyers will be more likely to remodel! (Shameless interior design plug) :)

Actually, the plus side of remodeling an older home is that generally you'll get more value from it versus paying builder markup on a new home.
Click to expand...

True, you just have to find good contractors to help you (which can be tough today).
Click to expand...

This is true. There is a shortage of skilled labor workers in the building/construction industry because the current workforce is aging and not enough younger people are not entering the field. Commercial projects are also having difficulty with the availability of workers, not just residential. Orange County has had to postpone a few projects due to shortage of labor. This shortage is also driving up the cost to build things.

I'm thankful to work with some really great contractors who don't try to gouge people and put in good, honest, high quality work. When you see the process that it takes to build something like a house, it really gives you a whole new appreciation for things like the roof over your head and the electrical that makes all the things in your house run.
 
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