Can you feel the shift?

[hipmatt]

TG, thanks for the responses. I appreciate where you are coming from, and while I am surprised at your new more bullish stance, I respect it.

I would love to see some examples of the home you rent. (I fully understand not giving your addy on line, but maybe a neighboor or any other example) And I would love to see how it is penciling out as a profitable renter. BTW you said that of the homes you listed , that they could rent for 1700-2200…. hmm anything over $2000 is wishful thinking. I wouldn’t pay more than $1700 myself to rent any of those, and I pay $1800 to rent a much larger/nicer home in Harveston(you know I am not a Harveston fanboy either) which has more amenities and a MUCH better location to the activities and hot locations in this town.

I guess my theory is that rents WILL drop in the Temecula area and I’m already seeing it / hearing about it. I know investors/landlords who are having a hell of a time keeping decent, paying tenants in their homes. I know two different landlords that have lost/are loosing homes to foreclosure, because they thought they were mini Donald Trumps, but now they can’t get the tenants to pay. I think a lot of the rental prices are a bit wishful thinking, and with the vast selection of rentals, and the fact that many up here will be forced to make lifestyle changes, means they will be renting for less. I know people who are renting nice homes for under 1600, and recently. My buddy and his co-worker just signed a 1 year lease on a 2200sqft two story in starlight ridge for $1550. Now it wasn’t that upgraded or trendy, but 4 good rooms, a nice street, a big lot, and a very great location central to everything in this area. Another just signed a $1600 in one of these homes….
http://www.redfin.com/stingray/do/printable-listing?listing-id=1600757

One last thing that I think you are assuming is that these people have the down payment to buy these homes that are close to being break even rentals. I fully agree about the shift though.

[Bugs]

This is somewhat related so I’ll post a real world example here.

I just completed several appraisals on a bulk holding of homes in western Riverside County, near the I-15/Hwy-91 junction. Yes, it’s in Riverside County, but we’re talking 30 miles or less to employment, not 60 as is the case for Riverside/Murrieta.

Anyways, I researched the entire sales history for all the homes in this subdivision, which consists of homes ranging from about 2,500 – 5,000 SqFt from the same builder, arrayed in several overlapping “communities”. The bottom end homes peaked in 2006 at about $650,OOO, and the upper end homes peaked at $1,000,000. Really, it corresponded in many respects to the San Elijo Hills area in San Marcos.

I performed a rental survey and found a couple examples of these homes renting at $2,200 – $2,500 per month. The highest as $3,000/month.

Anyways, I came across lots of NODs and some foreclosures, including some recent pendings and closed sales of REOs. Many of the original subdivision sales involved 80/20 loans and other obvious no-down financing.

What I found was that as late as late-2007 the pricing was holding out okay. But as of 12/2007 the pricing started dropping really dramatically. I now see an REO listing there on a 4,000 SqFt model that had previously sold in 2006 for $950+k is now listed for $700,000, and several examples of homes that are relisted at 25% – 30% less than their respective peaks in 2007. I even saw an early 2007 sale at $650,000 being relisted as an REO sale in the mid $400k ranges.

Most of the price movement has occurred within the last 4 months and it seems to be picking up steam. BTW, at these prices we’re already at $130 – $140 per SqFt, and none of these homes are even 3 years old yet. I even saw one closed sale at $122/SqFt.

TGs pain train has pulled into n/western Riverside County and the next stop is the OC. These banks will be getting more of these properties in foreclosure and they are competing with each other to sell them. When banks compete – you win.

As far as I can see it looks like we are headed for an overcorrection, and there’s nothing in front of us that will stop it. People may decide to jump into the market and purchase when pricing reached parity with their rents and they probably won’t get burned for that; but there’s no saying that the current rental structure is going to hold either. There’s certainly no fundamental reason why it has to.

[Bugs]

This is somewhat related so I’ll post a real world example here.

I just completed several appraisals on a bulk holding of homes in western Riverside County, near the I-15/Hwy-91 junction. Yes, it’s in Riverside County, but we’re talking 30 miles or less to employment, not 60 as is the case for Riverside/Murrieta.

Anyways, I researched the entire sales history for all the homes in this subdivision, which consists of homes ranging from about 2,500 – 5,000 SqFt from the same builder, arrayed in several overlapping “communities”. The bottom end homes peaked in 2006 at about $650,OOO, and the upper end homes peaked at $1,000,000. Really, it corresponded in many respects to the San Elijo Hills area in San Marcos.

I performed a rental survey and found a couple examples of these homes renting at $2,200 – $2,500 per month. The highest as $3,000/month.

Anyways, I came across lots of NODs and some foreclosures, including some recent pendings and closed sales of REOs. Many of the original subdivision sales involved 80/20 loans and other obvious no-down financing.

What I found was that as late as late-2007 the pricing was holding out okay. But as of 12/2007 the pricing started dropping really dramatically. I now see an REO listing there on a 4,000 SqFt model that had previously sold in 2006 for $950+k is now listed for $700,000, and several examples of homes that are relisted at 25% – 30% less than their respective peaks in 2007. I even saw an early 2007 sale at $650,000 being relisted as an REO sale in the mid $400k ranges.

Most of the price movement has occurred within the last 4 months and it seems to be picking up steam. BTW, at these prices we’re already at $130 – $140 per SqFt, and none of these homes are even 3 years old yet. I even saw one closed sale at $122/SqFt.

TGs pain train has pulled into n/western Riverside County and the next stop is the OC. These banks will be getting more of these properties in foreclosure and they are competing with each other to sell them. When banks compete – you win.

As far as I can see it looks like we are headed for an overcorrection, and there’s nothing in front of us that will stop it. People may decide to jump into the market and purchase when pricing reached parity with their rents and they probably won’t get burned for that; but there’s no saying that the current rental structure is going to hold either. There’s certainly no fundamental reason why it has to.

[Bugs]

This is somewhat related so I’ll post a real world example here.

I just completed several appraisals on a bulk holding of homes in western Riverside County, near the I-15/Hwy-91 junction. Yes, it’s in Riverside County, but we’re talking 30 miles or less to employment, not 60 as is the case for Riverside/Murrieta.

Anyways, I researched the entire sales history for all the homes in this subdivision, which consists of homes ranging from about 2,500 – 5,000 SqFt from the same builder, arrayed in several overlapping “communities”. The bottom end homes peaked in 2006 at about $650,OOO, and the upper end homes peaked at $1,000,000. Really, it corresponded in many respects to the San Elijo Hills area in San Marcos.

I performed a rental survey and found a couple examples of these homes renting at $2,200 – $2,500 per month. The highest as $3,000/month.

Anyways, I came across lots of NODs and some foreclosures, including some recent pendings and closed sales of REOs. Many of the original subdivision sales involved 80/20 loans and other obvious no-down financing.

What I found was that as late as late-2007 the pricing was holding out okay. But as of 12/2007 the pricing started dropping really dramatically. I now see an REO listing there on a 4,000 SqFt model that had previously sold in 2006 for $950+k is now listed for $700,000, and several examples of homes that are relisted at 25% – 30% less than their respective peaks in 2007. I even saw an early 2007 sale at $650,000 being relisted as an REO sale in the mid $400k ranges.

Most of the price movement has occurred within the last 4 months and it seems to be picking up steam. BTW, at these prices we’re already at $130 – $140 per SqFt, and none of these homes are even 3 years old yet. I even saw one closed sale at $122/SqFt.

TGs pain train has pulled into n/western Riverside County and the next stop is the OC. These banks will be getting more of these properties in foreclosure and they are competing with each other to sell them. When banks compete – you win.

As far as I can see it looks like we are headed for an overcorrection, and there’s nothing in front of us that will stop it. People may decide to jump into the market and purchase when pricing reached parity with their rents and they probably won’t get burned for that; but there’s no saying that the current rental structure is going to hold either. There’s certainly no fundamental reason why it has to.

[Bugs]

This is somewhat related so I’ll post a real world example here.

I just completed several appraisals on a bulk holding of homes in western Riverside County, near the I-15/Hwy-91 junction. Yes, it’s in Riverside County, but we’re talking 30 miles or less to employment, not 60 as is the case for Riverside/Murrieta.

Anyways, I researched the entire sales history for all the homes in this subdivision, which consists of homes ranging from about 2,500 – 5,000 SqFt from the same builder, arrayed in several overlapping “communities”. The bottom end homes peaked in 2006 at about $650,OOO, and the upper end homes peaked at $1,000,000. Really, it corresponded in many respects to the San Elijo Hills area in San Marcos.

I performed a rental survey and found a couple examples of these homes renting at $2,200 – $2,500 per month. The highest as $3,000/month.

Anyways, I came across lots of NODs and some foreclosures, including some recent pendings and closed sales of REOs. Many of the original subdivision sales involved 80/20 loans and other obvious no-down financing.

What I found was that as late as late-2007 the pricing was holding out okay. But as of 12/2007 the pricing started dropping really dramatically. I now see an REO listing there on a 4,000 SqFt model that had previously sold in 2006 for $950+k is now listed for $700,000, and several examples of homes that are relisted at 25% – 30% less than their respective peaks in 2007. I even saw an early 2007 sale at $650,000 being relisted as an REO sale in the mid $400k ranges.

Most of the price movement has occurred within the last 4 months and it seems to be picking up steam. BTW, at these prices we’re already at $130 – $140 per SqFt, and none of these homes are even 3 years old yet. I even saw one closed sale at $122/SqFt.

TGs pain train has pulled into n/western Riverside County and the next stop is the OC. These banks will be getting more of these properties in foreclosure and they are competing with each other to sell them. When banks compete – you win.

As far as I can see it looks like we are headed for an overcorrection, and there’s nothing in front of us that will stop it. People may decide to jump into the market and purchase when pricing reached parity with their rents and they probably won’t get burned for that; but there’s no saying that the current rental structure is going to hold either. There’s certainly no fundamental reason why it has to.

[Bugs]

This is somewhat related so I’ll post a real world example here.

I just completed several appraisals on a bulk holding of homes in western Riverside County, near the I-15/Hwy-91 junction. Yes, it’s in Riverside County, but we’re talking 30 miles or less to employment, not 60 as is the case for Riverside/Murrieta.

Anyways, I researched the entire sales history for all the homes in this subdivision, which consists of homes ranging from about 2,500 – 5,000 SqFt from the same builder, arrayed in several overlapping “communities”. The bottom end homes peaked in 2006 at about $650,OOO, and the upper end homes peaked at $1,000,000. Really, it corresponded in many respects to the San Elijo Hills area in San Marcos.

I performed a rental survey and found a couple examples of these homes renting at $2,200 – $2,500 per month. The highest as $3,000/month.

Anyways, I came across lots of NODs and some foreclosures, including some recent pendings and closed sales of REOs. Many of the original subdivision sales involved 80/20 loans and other obvious no-down financing.

What I found was that as late as late-2007 the pricing was holding out okay. But as of 12/2007 the pricing started dropping really dramatically. I now see an REO listing there on a 4,000 SqFt model that had previously sold in 2006 for $950+k is now listed for $700,000, and several examples of homes that are relisted at 25% – 30% less than their respective peaks in 2007. I even saw an early 2007 sale at $650,000 being relisted as an REO sale in the mid $400k ranges.

Most of the price movement has occurred within the last 4 months and it seems to be picking up steam. BTW, at these prices we’re already at $130 – $140 per SqFt, and none of these homes are even 3 years old yet. I even saw one closed sale at $122/SqFt.

TGs pain train has pulled into n/western Riverside County and the next stop is the OC. These banks will be getting more of these properties in foreclosure and they are competing with each other to sell them. When banks compete – you win.

As far as I can see it looks like we are headed for an overcorrection, and there’s nothing in front of us that will stop it. People may decide to jump into the market and purchase when pricing reached parity with their rents and they probably won’t get burned for that; but there’s no saying that the current rental structure is going to hold either. There’s certainly no fundamental reason why it has to.

[JWM in SD]

I’ve said before and I will say it again. Until the credit crunch and monetary policy issues work themselves out in the long run, there is not going to be a real bottom to housing prices in SoCal.

In the next two years many banks are going to go out of business due to insolvency, more people are going to lose their jobs as the recession deepens, foreclosures will continue as second wave of resets hit, lending standards will get tighter and the deflationary cycle ramps up.

If you think that housing is at the bottom you are FOOLING YOURSELF!!!

[JWM in SD]

I’ve said before and I will say it again. Until the credit crunch and monetary policy issues work themselves out in the long run, there is not going to be a real bottom to housing prices in SoCal.

In the next two years many banks are going to go out of business due to insolvency, more people are going to lose their jobs as the recession deepens, foreclosures will continue as second wave of resets hit, lending standards will get tighter and the deflationary cycle ramps up.

If you think that housing is at the bottom you are FOOLING YOURSELF!!!

[JWM in SD]

I’ve said before and I will say it again. Until the credit crunch and monetary policy issues work themselves out in the long run, there is not going to be a real bottom to housing prices in SoCal.

In the next two years many banks are going to go out of business due to insolvency, more people are going to lose their jobs as the recession deepens, foreclosures will continue as second wave of resets hit, lending standards will get tighter and the deflationary cycle ramps up.

If you think that housing is at the bottom you are FOOLING YOURSELF!!!

[JWM in SD]

I’ve said before and I will say it again. Until the credit crunch and monetary policy issues work themselves out in the long run, there is not going to be a real bottom to housing prices in SoCal.

In the next two years many banks are going to go out of business due to insolvency, more people are going to lose their jobs as the recession deepens, foreclosures will continue as second wave of resets hit, lending standards will get tighter and the deflationary cycle ramps up.

If you think that housing is at the bottom you are FOOLING YOURSELF!!!

[JWM in SD]

I’ve said before and I will say it again. Until the credit crunch and monetary policy issues work themselves out in the long run, there is not going to be a real bottom to housing prices in SoCal.

In the next two years many banks are going to go out of business due to insolvency, more people are going to lose their jobs as the recession deepens, foreclosures will continue as second wave of resets hit, lending standards will get tighter and the deflationary cycle ramps up.

If you think that housing is at the bottom you are FOOLING YOURSELF!!!

[losgatos200]

The bottom will reached when these illegals return to Mexico with their fat mullet head kids.

[losgatos200]

The bottom will reached when these illegals return to Mexico with their fat mullet head kids.

[losgatos200]

The bottom will reached when these illegals return to Mexico with their fat mullet head kids.

[losgatos200]

The bottom will reached when these illegals return to Mexico with their fat mullet head kids.

[Author]

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