Since the housing bust began, the banks have largely controlled the inventory of homes on the MLS. At first, they flooded the MLS with subprime foreclosures, but with mark-to-fantasy accounting, they were able to slow their foreclosure rates and store delinquent borrowers in shadow inventory. Since early 2009, the number of properties available for sales has been completely controlled by the banks. They determine when to list their standing inventory of REO, and they control the approval on every short sale. Between those two sources, the banks control the market. Banks decided early this year to slow the rate they took back properties at foreclose auctions thus reducing MLS inventory of REO significantly. More recently banks increased foreclosures 30% as [Read More...]

One hundred percent of those who lost homes in foreclosure suffered from excessive debt — 100%. The total amount of debt is important, but the terms of repayment are far more critical. The monthly payment (plus taxes, insurance and other costs) must be a manageable percentage of the borrower’s income, otherwise the borrower is likely to default. Historically, this value was 28% or less, then it was expanded to 30%, and now the GSEs underwrite to 31%. Debt-to-income ratios higher than this are proven to have accelerating default rates absent Ponzi borrowing. Thirty-one percent doesn’t sound like an onerous percentage of income. But most people forget this is gross income, not net. A 31% debt-to-income ratio is 50% or more [Read More...]

Irvine: Woodbury Overview Median home price is $481,000. Based on a rental parity value of $658,000, this market is under valued. Monthly payment affordability has been improving over the last 12 month(s). Momentum suggests improving affordability. Resale prices on a $/SF basis declined from $306/SF to $305/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $21 last month from $2,710 to $2,731. Rents have been slowly rising for 2 month(s). Price momentum suggests unchanging rents over the next three months. Market rating = 6 Proprietary Irvine Housing News home purchase analysis 43 HALLMARK Irvine, CA 92620 $699,900 …….. Asking Price Cost of Home Ownership —————————————————————————— $699,900 [Read More...]

Irvine: Woodbury Overview Median home price is $445,000. Based on a rental parity value of $648,000, this market is under valued. Monthly payment affordability has been improving over the last 4 month(s). Momentum suggests improving affordability. Resale prices on a $/SF basis declined from $310/SF to $306/SF. Resale prices have been falling for 12 month(s). Price momentum suggests falling prices over the next three months. Median rental rates increased $86 last month from $2,650 to $2,736. Rents have been falling for 1 month(s). Price momentum suggests unchanging rents over the next three months. Market rating = 5 Proprietary Irvine Housing News home purchase analysis 57 CONCIERTO Irvine, CA 92620 $547,000 …….. Asking Price $814,500 ………. Purchase Price 11/7/2005 ………. Purchase [Read More...]