Sweet Orange

Following are some housing number from Trulia for Irvine’s Northwood neighborhood. These numbers cover February to March 2009. These statistics are for all Northwood homes (both detached and condos) and are based on the sale of 51 homes in that three-month period. This is a sales increase of 2% from the previous quarter.

Median Sold Price: $540,000

• up 5.4% from the previous period (January to February 2009)
• down 14.1% from the same period of the previous year
• up 16.1% when compared to the same period of 5 years ago

% of homes on the market that are in distress: 95%

• number of homes on the market: 102
• number of homes on the market that are in distress: 97

Even in these tough times, I thought that 95% was a high number for distressed home on the market in Irvine’s Northwood, so I rechecked the numbers. Here is exactly what Trulia say on this: “There are currently 101 resale and new homes in Northwood on Trulia, including 96 homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process.”

So unless Trulia meant to write in addition to instead of including, the 95% number is correct. Also, recent numbers from Redfin showing approximately 100 Northwood homes on the market gives credence to the 95% distressed homes number. If anyone has any contrary information on this, please leave a comment.

By the way, recent information from DataQuick shows that notice of defaults in Orange County are up 19% from last year.

In the queue: more Orange County distress home sales information and a look at Redfin’s Northwood numbers, which among other things breaks down the median sold price per square foot into the detached homes and condo categories

Yesterday, I listed mostly the points in favor of the mixed-use, urban development in the Irvine Business Complex (IBC). Now here is my criticism of the IBC development. The trade off for a more densely built development has often been lower home prices. However, in the boom years of our recent past, the developers could make more money building these high-end high-rises, and understandably this is what they choose to build.

However, even then that wasn’t the primary type of high-density housing that Orange County needed. And today, even with our reduced housing prices, affordability is still a problem in Orange County. Building housing that is more in harmony with the median Orange County income is what is needed. The trade off for higher density should be lower home prices.

I think it would be interesting to take the IBC’s Astoria design tour put on by the American Society of Interior Designers (ASID), and, in the process, support the Orange County Performing Arts Center. But I suggest that future development objectives be tweaked to provide more affordability. And while I am at it, I will put in a word for keeping residential development on a more human scale, which would be four stories or less.

For a look at urban-living in the IBC from a design point of view, see Cindy McNatt’s “Loft-style living,” or watch this YouTube video.

Also, for more information on the current status of the IBC development and some various opinions on the development, see “Mothballed Condo Project in Irvine, CA,”  the City of Irvine’s IBC home page, “Irvine planners approve design of large-scale office retail project,” and “Irvine considers 6,000 residential units in urban core.”

GRAPHIC COURTESY THE CITY OF IRVINE

I have written about the evolving development of high- and mid-rise living in the Irvine Business Complex (IBC) and have been meaning to write more about this type of development. A recent post by Erica Chavez at the O.C. Register’s Irvine Homes blog has given me the nudge to get around to writing this post. So, before I go any further, thanks to Erica for her interesting post—and the nudge.

The post gives the details and some interesting links for the ongoing design tours that are occurring at the Astoria at Central Park West, one of the new IBC high-rise developments. As Erica points out the tours will continue through May 22, and the proceeds will benefit the Orange County Performing Arts Center. If you are interested in urban living and/or design, check out Erica’s post (Design tour offers sneak preview at Irvine’s newest high-rise).

Now here is where the nudge comes in. Some who left comments on the post had some harsh words about this development. My take is that Orange County is currently urban as well as suburban; however, some have trouble accepting that all development in Orange County is not going to be of the traditional suburban vintage. However, circumstances have changed since our suburban heyday, and our development criteria needs to progress with these changes. Our population has grown, so we don’t have the wide-open spaces of the past for housing developments. In addition, today we have more empty nesters and young professionals who want the advantages of urban living.

However, let me make it clear, I don’t think that suburban homes should be done away with. They should stay a big part of the mix. I just think that circumstances have changed and a need for a more diverse housing mix currently exists.

Tomorrow: my criticism of the IBC development

For more information on the IBC, see “The Housing Numbers for the Irvine Business Complex: Irvine’s Evolving, Mixed-Use Urban Center.”

GRAPHIC COURTESY ASTORIA

Warren Buffet, the Oracle of Omaha and economic savant (well, usually), stated recently that the housing market is stabilizing in important locations such as California. Closer to home, Jon Lansner has crunched some numbers to see if the Orange County housing prices are currently in line with the traditional “Orange Premium.” (”O.C. homes aren’t a true bargain“)

Most of us know that, in good times or bad, Orange County housing prices are higher than in most other parts of the country. For example, Lansner pointed out that the Orange Premium was 3.4 in 2004. In other words, for every one Orange County home that was priced at the Orange County average, 3.4 homes that were priced at the national average could have been purchased.

With the Orange Premium currently at 2.54, Orange County homes are obviously more affordable than in the recent past. Reports by the National Association of Home Builders and Wells Fargo Bank, John Burns Consulting, and the California Association of Realtors also state that the affordability of Orange County homes has increased drastically. But “more affordable” doesn’t necessarily mean “affordable.” So have we hit the housing price bottom in Orange County? As  Lansner’s numbers show between 1982 to 2001 this Orange Premium was 2.1. Therefore, the current Orange Premium of 2.54 is still higher than the more traditional Orange Premium of 2.1 and “we might not have suffered enough.”

Larry Roberts, otherwise known as IrvineRenter, has some predictions of his own. Most of the price declines up to this point have been in the low-end of the market, so this portion of the housing market might be at or near the bottom. However, Roberts predicts the following for high-end Orange County homes:

“Prices must fall back to equilibrium levels sustainable by the new lending standards. In these high-end neighborhoods, I believe we will see 65%-70% declines across the board. Stable price levels are going to be determined by people’s real incomes applied to conventional mortgage financing; people only make enough money to support prices 1/3 as high as they currently are. Prices in these neighborhoods quadrupled or more since the late 90s—incomes have not.”
—Larry Roberts, “HELOC Abuse Laguna Beach Style”

Have we hit the price bottom for Orange County homes? Not yet. The decline in Orange County housing prices has slowed, but we have not seen the bottom.

I have been providing detailed housing statistics for some Irvine neighborhoods (Maybe too detailed. I’m working on streamlining this.). I would like to provide similar information for Costa Mesa. This post explains why I haven’t been doing that.

This is a question for those who create the real estate listings. However, if anyone else has the answer, please chime in.

So here is the question: Why do some real estate maps have listing information broken down by neighborhood in addition to by city and ZIP, but others don’t have the neighborhood info? For example, many real estate maps have information for Irvine listed by neighborhood as well as by ZIP and for the city as a whole. However, this is not true for Costa Mesa.

In spite of the fact that Costa Mesa has some distinct neighborhoods that are worth singling out, the Costa Mesa information is listed for the city as a whole and for its two ZIPs (92626 and 92627) but not for the Costa Mesa neighborhoods. The ZIP information is not very useful since these ZIPs cover a vast and diverse area.

I have been told that the information that we see on sites like Redfin, Trulia, and Zillow is generated from information that they receive from real estate listing services. So, listing services, why the extra love for some communities and not for others? What’s up? How about some extra love for Costa Mesa?

Anyone have an answer to this question? Redfin? Trulia? Zillow? Anybody?

Note: If you click on the Irvine or Costa Mesa link, you will see some non- Irvine and Costa Mesa ZIP codes. This is true for other cities too and seems to be another problem with the information that the listing services provide.

Here is a sample of what is currently on the market in Irvine’s Westpark neighborhood (Click on this link to get Larry Roberts’, a.k.a. IrvineRenter’s,  description of the Westpark area. He provides a thorough and insightful description.). As I mentioned yesterday (Irvine’s Westpark Neighborhood: A Look at the Housing Numbers), 41 of the 47 Westpark homes that are currently on the market are in some type of market distress. Two of these distressed properties are listed below.

The most expensive home currently on the Westpark market is located at 1 Lorenzo. This 4 bedroom has an asking price of $1,179,000 ($453/SF) and a homeowners association fee of $40 per month. This home was brought in March 2004 for $860K. According to Zillow, 89% of the homes in this ZIP code have a lower price.

The least expensive home currently on the Westpark market is located at 10 Mozzoni Aisle. This 1 bedroom has an asking price of $310,000 ($303/SF) and homeowners association fees of $250 and $40 per month. This is a short sale.

At 162 Almador is a Westpark home that is near the median price for Westpark homes. This is a 1989 condo with 3 bedrooms and an asking price of $449,000 ($319/SF). The homeowners association fees are $216 and $40 per month. This short sale was bought in December 2004 for $525K.

PHOTO COURTESY WESTPARK ELEMENTARY SCHOOL, THE IRVINE UNIFIED SCHOOL DISTRICT

Trulia statistics state that the median price for all Westpark homes selling in the first quarter of 2009 was $462,000. This is a decrease of 20.0% when compared to the previous quarter, an increase of 4.5% when compared to the previous year, and a decrease of 6.5% when compared to the price of 5 years ago. The number of sales stayed constant when compared to the number of sales one year ago.

Trulia states that the average price per square foot in the first quarter of 2009 was $339. This is up 11.1% from the same period last year.

Trulia also states that 21 homes sold in Westpark during the first quarter of 2009, and 47 homes are currently on the market in Westpark. With 41 of these homes in the pre-foreclosure or bank-owned stage of the foreclosure process, a remarkably high percentage of the Westpark homes are in distress.

Following are some Westpark numbers provided by Redfin. For more information on this area, see the Westpark map.

April 4, 2009

• List price: $700K/$359 per SF
• Sold price: $443K/$326 per SF*
• Median days on market: 88*
• Number of homes on the market: 39
  (30 detached/9 condos; 0 Bank and MSL foreclosures)

February 27, 2009

• List price: $744,000/$361 per SF
• Sold price: $594K/$324 per SF*
• Median days on market: 127*
• Number of homes on the market: 34
  (28 detached/6 condos; 0 Bank and MSL foreclosures)
  

January 31, 2009

• List price: $737,000/$366 per SF
• Sold price: $580K/$358 per SF*
• Median days on market: 96*
• Number of homes on the market: 24

December 30, 2008

• List price: $749,000/$358 per SF
  
• Sold price: $572K/$369 per SF*
• Median days on market: 83.5*
• Number of homes on the market: 25

Sources: Redfin; Trulia

Tomorrow: Westpark: The Highs, the Lows, and the In Between