Here's some interesting analysis from The Great Loan Blog. It suggests the higher end is due for even more pain as lending standards appear to be tightening still:
"Over the summer we experienced a restriction in lending guidelines that moved most jumbo mortgages to a minimum of 20% equity requirement. Within the last week we have seen many of our investors move to a minimum of 25-30% equity either for a refinance or a purchase loan in most major markets."What could the effect be?
"...expect to see continued price pressure on the luxury market as buyers wake up to an even more restrictive lending environment. It will continue to tighten or rates will increase(to compensate for risk) until the loans perform and the foreclosures slow."It most likely means, then, that there will be fewer buyers for this kind of property. Today's happens to be in RSM.
31 Ledgewood Dr, 92688
Asking price: $850,000
Asking price/ sq ft: $278
Purchase price: $1,075,000
Purchase date: 7/18/06
Size: 4 beds, 3 baths, 3,060 sq ft (built in 1997)
MLS: S553640 (10 days on Redfin)
Zillow Zestimate: $763,000
HOA dues: $100 + $2,336 yearly MR
Type: Single Family Residence
Style: Mediterranean
Stories: 2
Lot size: 6,724 Sq. Ft.
From listing: One of the BEST streets in Las Flores! Downstairs bedroom with built in desk. Italian Marble floors through-out downstairs and bathrooms, granite kitchen counters, built in kitchen table, TV room with built in shelving. The most incredible views from the master bedroom, bathroom, kitchen, family room, dining room and living room. Laundry shute from upstairs to laundry. Master walk in closet with closet organizer. Located on a Cul de Sac. School system is Las Flores K-8 and walking distance to Tesoro High School.
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Even Zillow says this property has lost 29% of its value since 2006. Million-dollar house no more.Google maps shows us the street is indeed very nice looking, though it doesn't really seem like a cul de sac house considering we can't see the end of it.
If the property can be sold for its full asking price, it would be a loss of $276,000 off the previous sales price, including 6% sales costs.
6 comments:
This home was probably about 1.2m at the peak. When this is all over, homes will be about 50% off the peak, so I wouldn't pay more than 600K for this. Any more than that and the buyer will soon be underwater. Still has a LOT further to drop.
anonymous is correct: these homes will go for 50% off...likely it'll be 60% off from the peak. About $400-450k. When lenders are requiring 20% down and verifying income, who is going to spend $800k on place out in RSM? Won't happen. There's a new paradigm completely now.
RSM is having a tough time. Here are two short sales. Notice the purchase price and the asking price, and ask yourself how they became short sales.
8 VIA BABERA, MLS #P663936, Asking $789,999, Last Sale 5/22/98, $343,000
11 CHARCA, MLS #S519703, Asking $769,000, Last Sale 06/07/96, $265,000
Must have been a great 10 years for both houses.
New2oc, those numbers are astounding...good find. Bubble money was fueling the entire OC economy for years. Everybody (including the responsible people) will pay dearly for this ponzi scheme.
Good stuff, new2oc. That is what is scaring me right now - there are these type of re-fi causing short sales and foreclosures starting to pop up, and from what I've been hearing from people in the industry, financing is slowly getting tighter in the higher end.
Cash is king.
Look at the recent posts at
http://bluemove.blogspot.com/
The people foolish enough to buy recnetly in Laguna Beach are getting burned big time!
Cash is indeed king.
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