Retracing the housing bubble in Orange County – Is real estate still in a bubble in Orange County? T

Retracing the housing bubble in Orange County – Is real estate still in a bubble in Orange County? american airlines ticket reservations The $1 million median home price prediction of 2005. Costa Mesa lists 8 foreclosure on MLS while 313 homes are in the shadow american airlines ticket reservations inventory. Dr. Housing Bubble Blog
Retracing the housing bubble in Orange County – Is real estate still in a bubble in Orange County? The $1 million median home price prediction of 2005. Costa Mesa lists 8 foreclosure on MLS while 313 homes are in the shadow inventory.
I was having a conversation with a colleague in the real estate industry about the ubiquitous access of real estate information available to the public.  This easy access to home sales data and tracking historical prices without going to the county registrar is so common today we take it for granted.  You would think that access to information would cause people to make wiser decisions but that is not always the case.  In fact it can be argued that this access to information accelerated the mania by encouraging american airlines ticket reservations the herd to look at rising american airlines ticket reservations prices on a daily basis.  They would pull up data and see home prices american airlines ticket reservations rising on a monthly basis.  How often would you hear, "in the last year, my home went up X thousand dollars" as if this was somehow normal? american airlines ticket reservations In this line of reasoning, american airlines ticket reservations more people had quicker access to view the massive rise in home values and those who were skeptical, would likely punch a few keys on their keyboard and verify this data point. american airlines ticket reservations If access to information made the bubble grow faster , will it make the bubble pop that much deeper?  I wanted to do a historical examination of a mid-tier american airlines ticket reservations city in Orange County, Costa Mesa .  We are such forward looking creatures that when we look at the past data we understand why it is so crucial not to forget history .
The headline above might seem a bit hyperbolic today but this prediction was made back in 2005.  Someone sent an article from the O.C. Register going back to July of 2005 at the height of the bubble.  I think it warrants close examination and would be useful to update where things stand today:
If you look at the below mania chart and simply took it for face value this might make sense but certainly incomes weren't rising this way.  And the proof of this was right in front of their faces even in this article!  You have one person saying:
"SOLD: Sergio and Monica Anaya and their two children left their rental and bought this three-bedroom Costa Mesa home after signing two loans (including an interest-only mortgage) and taking on two boarders who occupy one of the bedrooms."
This is simply more glaring proof of the bubble even within this article.  Purchasing a home for $600,000 with an interest-only mortgage and taking on two boarders.  Would this end badly?  Take a wild guess.  Now, how about we look at some actual proof and fast forward:
Costa Mesa is a mid-tier city in Orange County.  There is nothing extraordinary about the area and certainly not warranting american airlines ticket reservations a $600,000 price tag for the home above.  You might notice something creeping above over the tree in the picture.  What is that?
Apparently this home never hit the $1 million median price and actually went into full reverse.  This for an area where households pull in $45,000 to $60,000 a year depending american airlines ticket reservations on which of the two zip codes you look at.  The home likely ended up in foreclosure and sold in 2008 for $450,000.  Dig deeper and look at the tax assessment.  In 2011 the place was assessed for $384,000.  That is a price point $66,000 below the 2008 purchase price which had already dropped by $150,000 from the 2005 sales price.  Costa Mesa and other mid-tier markets are places were the shadow inventory is going to be an additional drag on prices.
You tell me if Orange County is going to hit that median $1 million price in the next decade.  For those keeping score, the latest median price is $388,000.  It always helps to keep things in perspective especially when the shadow inventory is immense in mid-tier cities american airlines ticket reservations in Southern California.
Retracing the housing bubble in Orange County – Is real estate still in a bubble in Orange County? The $1 million median home price prediction of 2005. Costa Mesa lists 8 foreclosure on MLS while 313 homes are in the shadow inventory.
I think that is the back of a freeway sign. A really large multi-lane sign. It makes sense since this is the backyard of a big freeway interchange. Lots of traffic, lots of pollution, lots of noise, and lots of accidents.
american airlines ticket reservations We call those homes fwy homes and in our area (east Ventura County) many of these homes are priced higher than quieter neighborhoods. They upgrade them galore, nevermind being within 100 yards of a fwy increases your risk for cancers. They can keep their granite, my husband and I work hard at staying american airlines ticket reservations healthy.
Yet I see these dolled up dogs go out to what I call interior buyers . We bought beautiful american airlines ticket reservations interior homes before, even one with a master bdrm fireplace and a deck with a view. No privacy in a two story jungle american airlines ticket reservations (and we had a wide lot but two story jungle.) The quality of the location and lot makes the experience. You can t change them. I wish stupid buyers would just go away.
The good doctor again points out the idiocy of more bubblicious days. As a long time home owner and potential move-up buyer I d like to thank DHB for reminding me to remain on the sidelines for the last few years. That said, while nominal prices have a little ways yet to fall (and will likely bounce along the bottom for years to come), it s looking american airlines ticket reservations like the largest declines have already occurred in most markets.
Given that, I was hoping the doctor might address the economics of the move-up buyer. american airlines ticket reservations Assuming said buyer has enough equity to sell his/her home it would seem that fluctuations in housing price have little impact on the advisability of a move up purchase. american airlines ticket reservations Any loss incurred from future declines in the price of the move up home would be largely offset by declines in the equity american airlines ticket reservations of the existing home were the homeowner american airlines ticket reservations not to move.
Well Jeepers I guess that Caltech math degree wernt good fer nuthin after all. But if you must put actual number american airlines ticket reservations on things I have a house currently valued at ~$400K and am considering moves into homes worth ~$500K. Assuming the bulk of declines have already occurred and I risk a further decline of 10-20% that would put my risk at roughly $10-20K amortized over several years an amount less than my daily fluctuation in net investment worth. But maybe since math evidently isn t my strong american airlines ticket reservations suit you could enlighten me as to where my additional risks might lie.
Given that most markets have already gone through the bulk of their declines, it really comes down to where your home is and where you want to live when you trade up. There are still neighborhoods out there that have more downside. You d need to move in comparable neighborhoods where both your neighborhood and the new one have had similar slides.
That is the rub and the thing that makes me hesitant. Price declines have been non-uniform and have tended to hit less expensive american airlines ticket reservations homes first. This would tend to disadvantage move up buyers. But I am hoping that by concentrating on areas that have suffered declines similar american airlines ticket reservations to my current neighborhood I can minimize this risk.
Wow, this reminds me of my ex-Brother in Law, who bought a move up house in 2001 for $300,000 in Corona, CA. He was always bragging when I visited from Pennsylvania about how his house was worth, 500K then 600K then 700K and how he had everything american airlines ticket reservations planned to retire early when it hit 1 Million.
If he d had a crystal ball he could have sold that house in 06, held the cash until the crash and bought Ford stock for less than $3.00 a share and become a multimillionaire and bought whatever the heck he wanted. I wish I could flip hindsight to foresight. Truth be told if I put all I had in Ford when it was recommended to me I would have ended with a net of 1.5 million. Ain t dreamin fun. In truth I wish they would let the market correct via no more bailouts, no bulk investor sales and correct to mark to market so I could buy and we could see our jobs and economy bounce back.
Can you tell us why? Actually I think buying a house near (not next to) a school or a park is a good idea. That way my in-laws or my parents can send the kid to school and take him home without driving and they can kill some time going to park. But I m definitely would like to hear the reasons why you think it s not a good idea. Maybe I m missing something!?
By near I mean in close proximity, like bordering these public places. K thru 8 is often a situation of morning student drop offs and afternoon pickups and the congestion and driveway turnarounds of parents hurrying to/from work. Also, some of the little kiddies who walk have a bad habit of littering your lawn or cutting through your yard. High school proximity american airlines ticket reservations is the worst ..weekend noise from sports events is just one issue. Teen reckless driving is another issue. And check with the local police stats on daytime american airlines ticket reservations burglaries in the immediate area of a high school ..you may be surprised.
Public parks draw strangers american airlines ticket reservations most are good family people and well-behaved, some are not, especially after dark. In a less public suburban american airlines ticket reservations environment, residents keep an eye out and make note of unusal activity by persons they don t know or look suspicious in the area.
It s nice to be in close proximity to a school. However in today s world, little Johnny and Sally generally don t walk, ride their bikes or take the bus to school. So what you have is hundreds of luxury SUVs dropping/picking up the kids from school. Good luck trying american airlines ticket reservations to get out of/into your neighborhood when the roads are backed up. Don t believe me, go down to your local elementary school on Monday morning.
A lot of boomers don t have much savings. All the crap they used to brag about like sending their kid to a fancy college and their wonderful house or houses have all flopped. A college grad is lucky to work at mcdonalds and most houses have been wint