NORTHPARK

Houses are still more than 20% undervalued despite rising prices

Oct 152012

Each month I publish the OCHN Market Newsletter. It provides the most detailed and accurate view of the housing market available without the realtor spin. I believe potential homebuyers should have the best information possible to make reasonable and rational decisions regarding the purchase of a home. Despite how bearish I have been, my strictly mechanical reports have been issuing strong buy signals since last fall. Now that house prices have turned positive, rents are still going up, interest rates are trending down, affordability is at record highs, and houses are undervalued by historic norms, the report is very bullish. And as I noted recently, I am turning bullish too. Notice the downside overshoot in the chart below. It may [Read More...]

The housing crash is not over yet, is it?

Oct 122012

I am no longer bearish. I have been an outspoken housing bear for over five years now, but based on recent developments, I have far fewer worries about another catastrophic decline in house prices. The recent changes are as follows: Federal reserve’s open-ended commitment to unlimited stimulus for as long as it takes no matter the consequences. Lending cartel’s improved control of inventory liquidation. Removal of most barriers for refinancing underwater loans to aid kicking the can to spread out liquidations. These new developments when combined with some older existing policies has finally created the conditions for a manufactured bottom to form. Federal government’s suspension of mark-to-market accounting allowing unlimited delinquent mortgage squatting. Federal reserve’s zero percent interest rate to [Read More...]

Home sales fall calling into question California’s housing recovery

Oct 042012

Recently I wrote that a durable recovery would be demand driven, not supported by restricted supply. Reductions in supply may temporarily force house prices higher, but a sustained recovery requires higher prices and higher sales volumes. In other words, a durable recovery requires a resurgence of demand. Reduced supply threatens to choke off the recovery as buyers lose interest in a market where little is available for sale, and the prices being asked are too high. In a high demand market, buyers don’t wait on the sidelines. In a supply restricted market, they do. And wisely so because educated buyers know the supply will come to the market eventually, and there is no need to overpay today for a product [Read More...]

Banks increase foreclosures 30% while REO pipeline stabilizes

Sep 202012

Bank behavior determines home prices. They control the supply, and they control the money that drives demand. Whenever the banks change their policies, it shows up in the foreclosure statistics, and these changes determine the future of home prices. In August, three important developments happened in the foreclosure market: Banks greatly increased their REO acquisitions. Banks sharply curtailed new filings of notices of default. Banks stopped their internal liquidations of REO standing inventory. Each of these developments has implications for future home prices. The Foreclosure Report – August 2012 “We continue to see reports that there will be a wave of foreclosure sales after the election or at the start of the year,” stated Sean O’Toole, Founder & CEO of [Read More...]

Real estate only goes up… Yeah, right…

Sep 072012

The opening of The Great Housing Bubble succinctly described the real estate bubble: What is a Bubble? A financial bubble is a temporary situation where asset prices become elevated beyond any realistic fundamental valuations because the general public believes current pricing is justified by probable future price increases. If this belief is widespread enough to cause significant numbers of people to purchase the asset at inflated prices, then prices will continue to rise. This will convince even more people that prices will continue to rise. This facilitates even more buying. Once initiated, this reaction is self-sustaining, and the phenomenon is entirely psychological. When the pool of buyers is exhausted and the volume of buying declines, prices stop rising; the belief [Read More...]

Northpark hovering about 17% below rental parity

Jul 172012

Irvine: Northpark Overview Median home price is $481,000. Based on a rental parity value of $644,000, this market is under valued. Monthly payment affordability has been improving over the last 3 month(s). Momentum suggests improving affordability. Resale prices on a $/SF basis declined from $294/SF to $293/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $41 last month from $2,590 to $2,631. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 6 Proprietary Irvine Housing News home purchase analysis 12 BELLA ROSA Irvine, CA 92602 $899,000 …….. Asking Price $622,500 ………. Purchase Price 4/30/2002 ………. [Read More...]

Northpark prices showing signs of stabilization

Jun 272012

Irvine: Northpark Overview Median home price is $534,000. Based on a rental parity value of $624,000, this market is under valued. Monthly payment affordability has been improving over the last 2 month(s). Momentum suggests improving affordability. Resale prices on a $/SF basis increased from $293/SF to $294/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $83 last month from $2,506 to $2,590. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 6 Proprietary Irvine Housing News home purchase analysis 30 PACIFIC Grv Irvine, CA 92602 $1,338,000 …….. Asking Price $990,000 ………. Purchase Price 6/15/2003 ………. [Read More...]

Northpark prices are still falling

Jun 152012

Irvine: Northpark Overview Median home price is $534,000. Based on a rental parity value of $624,000, this market is under valued. Monthly payment affordability has been improving over the last 2 month(s). Momentum suggests improving affordability. Resale prices on a $/SF basis increased from $293/SF to $294/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $83 last month from $2,506 to $2,590. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 6 Proprietary Irvine Housing News home purchase analysis 6 GRASS Vly Irvine, CA 92602 $825,000 …….. Asking Price $810,000 ………. Purchase Price 1/23/2004 ………. [Read More...]

Northpark prices steadily falling

Jun 072012

Irvine: Northpark Overview Median home price is $427,000. Based on a rental parity value of $615,000, this market is under valued. Monthly payment affordability has been improving over the last 1 month(s). Momentum suggests unchanging affordability. Resale prices on a $/SF basis declined from $291/SF to $290/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $101 last month from $2,480 to $2,581. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 7 Proprietary Irvine Housing News home purchase analysis 12 RAVENDALE Irvine, CA 92602 $949,768 …….. Asking Price $537,000 ………. Purchase Price 9/4/2002 ………. Purchase [Read More...]

Northpark condos continue to plummet

May 282012

Irvine: Northpark Overview Median home price is $427,000. Based on a rental parity value of $615,000, this market is under valued. Monthly payment affordability has been improving over the last 1 month(s). Momentum suggests unchanging affordability. Resale prices on a $/SF basis declined from $291/SF to $290/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $101 last month from $2,480 to $2,581. Rents have been rising for 12 month(s). Price momentum suggests rising rents over the next three months. Market rating = 7 Proprietary Irvine Housing News home purchase analysis 1006 TERRA BELLA Irvine, CA 92602 $329,000 …….. Asking Price $394,000 ………. Purchase Price 1/30/2004 ………. [Read More...]

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