Here's recent history of the Fed’s policy committee and its Fed Funds rate. Next Fed decision is June 24/25.
North County sees biggest rent hikes
July 24th, 2008, 12:14 am · 28 Comments · posted by Jon Lansner/O.C. Register columnist
Reports from RealFacts and Axiometrics suggest the north county tenants will face the toughest time avoiding significant rent hikes at the county’s big apartment complexes.
Second quarter stats from both apartment watching firms show a growing number of vacant apartments countywide as well as landlord’s weakening ability to up the rent in many parts of the county. (Note: The reports’ numbers vary because apartment watchers rely on somewhat limited surveys of different big landlords and what they can charge. That’s different, for example, than home-price reports we track that are based on broad collections of public records.)
Rental units are a local-local game, with trends varying across the county, as the community analysis by both RealFacts and Axiometrics show:
• RealFacts has Stanton and Fullerton with the second quarter’s biggest annualized hikes in the average “asking rent.”
• Axiometrics had South Anaheim and Fullerton atop their list of “effective rent,” or rent hikes minus concessions.
• Real Facts had three neighborhoods with falling rents: Rancho Santa Margarita Placentia and Newport Beach .
• Axiometrics had two decliners: Costa Mesa and Orange County “Other.”
Here’s a look at the two firm’s ranked list of year-to-year rent hikes, by the community niches they respectively watch …
| Community | RealFacts | Community | Axiometrics |
|---|---|---|---|
| Stanton | 6.0% | South Anaheim | 5.6% |
| Fullerton | 5.2% | Fullerton | 5.4% |
| Costa Mesa | 4.9% | North Anaheim | 3.8% |
| Buena Park | 4.8% | South Santa Ana | 3.6% |
| Mission Viejo | 4.6% | Brea | 3.2% |
| Laguna Niguel | 3.8% | Huntington Beach | 3.2% |
| Cypress | 3.5% | LagunaBch./DanaPt. | 3.2% |
| Anaheim | 3.4% | Westminstr./FountnVly. | 3.1% |
| Irvine | 3.3% | Placentia/NE Anahm. | 2.5% |
| Garden Grove | 3.1% | Irvine | 2.1% |
| Huntington Beach | 2.9% | North Santa Ana | 1.8% |
| Tustin | 2.2% | Buena Park | 1.7% |
| Westminster | 2.2% | Newport Beach | 1.3% |
| Brea | 2.2% | Mission Viejo | 1.1% |
| Orange | 2.1% | Tustin | 0.9% |
| Lake Forest | 1.7% | Orange | 0.3% |
| Fountain Valley | 1.3% | Laguna Hills | 0.0% |
| Santa Ana | 1.1% | Costa Mesa | -1.3% |
| Aliso Viejo | 0.5% | Other O.C. | -2.1% |
| La Habra | 0.0% | All of Orange County | 1.8% |
| Rancho Snta Marg. | -0.7% | ||
| Placentia | -1.0% | ||
| Newport Beach | -2.0% | ||
| All of Orange County | 3.1% |
Other rental news…
- North County sees biggest rent hikes
- O.C. calls up 23% for advice on late rent, house payments
- Rents go flat at O.C.’s 3-bedroom townhomes
- O.C.’s empty apartments seen at 6-year high
- 20-somethings coming home to roost
July 24th, 2008 at 6:59 am
NO WAY RENTS DOWN BY THE BEACH
NEWPORT BEACH DOWN……
HEYY MULLIGAN BOY
ITHOUGHT RENTS NEVER GO DOWN OR HOUSE PRICES NEVER GO DOWN BY THE BEACH….LOLLL
AND I CANT BELIEVE U HAVE A LICENSE TO GIVE OUT FALSE INFORMATION EITHER
I WONDER IF THATS CONSIDERED FRAUD ……….HMMMMMMMMMMMM
SOMEONE I THINK NEEDS TO BE TOLD ABOUT UR ADVICE U GIVE OUT
July 24th, 2008 at 7:08 am
I guess Steve Thomas was wrong
Existing home sales down in June
In this case, the Realtor didn’t even try to spin the horrible news.
July 24th, 2008 at 7:09 am
Gotta Tappa Kegga is still here? Please go educate yourself before you presume so much. You just have no idea as to what I do. Please go find my posts where I say “prices never drop by the beach.” I will be here waiting….you won’t be able to, just as you cannot find the ability to communicate in an educated format. If one of your posts remotely looked as if you had passed a remedial English class, it would be a miracle. You do not engage discussion as you know you will be wiped with the floor. When do you pack for this semester?
July 24th, 2008 at 7:12 am
hey folks, what is going on with Downey Savings? Does anybody know?
I just read this article on the LA Times.website.
http://www.latimes.com/business/la-fi-downey24-2008jul24,0,377032.story
July 24th, 2008 at 7:17 am
the downey savings stock is down 16% today. Ouch!!!
July 24th, 2008 at 7:17 am
WELL MULLIGAN/ALFALFA/CRYSTALBALLS/ALL THE OTHER GOOF BALL NAMES U USE THERES ENOUGH ON HERE TO BURY U 100 TIMES OVER I JUST DONT HAVE TIME TO WASTE.
BUT I WOULD BE WILLING TO ASK EVERYONE TO SEE IF THEY AGREE WITH ME. LETS PUT TO VOTE
WHO SAYS MULLIGAN HEAD AND ALL HIS OTHER NAMES SAID PRICES DONT GO DOWN BY THE BEACH/ BUY rEAL ESTATE IN PAST YEAR?
IF U FOLLOWED HIS ADVICE WOULD U BE BETTER OFF NOW OR WORSE?
IF I GET ANY YES ANSWER FROM ANYONE U MUST GET OFF THE BLOGG I THINK THATS FAIR!!!
OFF TO GO TAP A KEG IM CELEBRATING MAYBE NOW U WILL LEAVE MULLIGAN BOY
July 24th, 2008 at 7:29 am
Bubbs: Are you seeing anything different today with the markets? Over the past few months, anytime the Dow was down triple digits, oil was up at least 3% if not more. We are not seeing that today.
Capboy: I use one name. Sorry to disappoint you. Go conspire with Jake on the multiple handle theory. But that is typical of you. I tell you to go find MY posts…and now you need a few more names to do so. Now, why is that college boy?
July 24th, 2008 at 8:37 am
Why only apartments? Mobile Home parks also rent. Our park in Cypress offers a 6% annual rent increase if you sign a 25-YEAR lease! 7% with a 15-year lease. No shorter lease term is offered, and without a new lease, the increase is 9%!!!
July 24th, 2008 at 8:47 am
Mulli, oil was in a bubble and it is finally bursting so I don’t expect it to go up again for at least a couple of weeks.
As far as the general market goes, it is all about earnings. Also, the weak existing home sales numbers didn’t help.
I guess the market needs the Fed to come up with another bailout plan or more rebate checks. As you have seen recently, Congress and the White House are trying by all means to keep the credit bubble going. All we are doing is kicking our problems out into the future.
July 24th, 2008 at 8:57 am
nb:
the fed did nothing before the great depression and we know what happened after that.
July 24th, 2008 at 9:00 am
business cycles are a normal part of any economy. Sooner or later, the market needs to flush out the excesses of the boom. You can have your pain now or 3 years from now.
July 24th, 2008 at 9:02 am
omg, downey savings is under 2 bucks/share
down 28% today.
http://finance.yahoo.com/q?s=dsl
July 24th, 2008 at 9:05 am
nb:
fdr has the wisdom to know that the fed need to do something about the great depression.
i am all for the housing correction but i surely don’t want to see another great depression in this country.
you and i may end up standing in the bread line.
downey saving will go bk. i know someone who work there.
July 24th, 2008 at 9:15 am
ranting renter Says: “downey saving will go bk. i know someone who work there.”
let’s hope you are wrong because we don’t need another IndyMac in Orange County. Downey Savings employs a lot of people in Orange County.
July 24th, 2008 at 9:44 am
Downey fallout:
http://mortgage.freedomblogging.com/2008/07/24/downey-financial-reports-big-q2-loss-ceo-and-chairman-step-down/
July 24th, 2008 at 10:30 am
Intresting stats? Things are changing so rapidly its hard to keep up. 90 day old statistics dont provide any acurate outlook on our market.
July 24th, 2008 at 11:03 am
I have a question:
What about the “title insurance” companies such as First American. How are these companies doing amidst all the foreclosures? Do they have anything to do with it?
July 24th, 2008 at 11:32 am
NatBub,
Some time back — I would say 2 or 3 years ago - I read criticism of Downey’s accounting methods as relates to their OptionArm loans,
As I recall, Downey was crediting (on the books) option-arm payments received as if it were a fully amortized payment made against the outstanding loan, even if the borrower had only made the minimum (less than interest-only) payment.
It seemed obvious that this was a bad plan……
Do you recall any of this? There were several different critical stories about this.
Seeing as how Downey was a BIG player in the OptionArm game, and all indications are that most optionArm borrowers chose the minimum payment option resulting in negative amortization of their mortgages, this whole idea was destined to lead to disaster.
July 24th, 2008 at 11:39 am
yes pdu, now I remember. These are very difficult times for all these financial institutions. Unfortunately, every time one of these financial institutions fails, thousands of innocent employees loose their jobs, which in turn, depress the housing market even further.
July 24th, 2008 at 11:45 am
I did find this from a March 2, 2006 conference call regarding several lenders:
“Downey Financial (DSL) – Our second concern is Downey Financial. While Downey originates with a relatively low loan-to-values—which is an important risk mitigant—it also has the highest negative amortization rates in the group. Low loss reserves and high deferred costs also give us pause. Downey ended the year with almost 88% of its mortgage book having some level of negative amortization. Almost 24% of interest income booked during the fourth quarter was noncash and capitalized into the balance of loans.”
—
I’m a bit vague on what “noncash” interest income booked really means here.
Could it be that they booked as “income” the interest they would have received had the borrower actually paid the interest due instead of the minimum payment? (Minimum payment on an OptionArm loan is less than the interest only payment option and much less than the 30 year amortized option)
This was the way I interpreted the criticism Downey’s accounting method back when I had first read of this.
July 24th, 2008 at 12:04 pm
OK.
Here it is, from the Dr. Housing Bubble Blog - June of this year:
—-
(Businessweek 2006)
‘Now the signs of excess are crystal clear. Up to 80% of all option ARM borrowers make only the minimum payment each month, according to Fitch Ratings. The rest of the money gets added to the balance of the mortgage, a situation known as negative amortization. And once balances grow to a certain amount, the loans automatically reset at far higher payments. Most of these borrowers aren’t paying down their loans; they’re underpaying them up.
Yet the banking system has insulated itself reasonably well from the thousands of personal catastrophes to come. For one thing, banks can sell some of their option ARMs off to Wall Street, where they’re packaged with other, better loans and re-sold in chunks to investors. Some $182 billion of the option ARMs written in 2004 and 2005 and an additional $83 billion this year have been sold, repackaged, rated by debt-rating agencies, and marketed to investors as mortgage-backed securities, says Bear, Stearns & Co. (BSC )Banks also sell an unknown amount of them directly to hedge funds and other big investors with appetites for risk.
The rest of the option ARMs remain on lenders’ books, where for now they’re generating huge phantom profits for some lenders. That’s because, according to generally accepted accounting principles, or GAAP, banks can count as revenue the highest amount of an option ARM payment — the so-called fully amortized amount — even when borrowers make only the minimum payment. In other words, banks can claim future revenue now, inflating earnings per share.”
—
The above was from Business Week, the below is from the blog:
“And for those of you who say we didn’t see this coming, that paragraph was pulled from a Businessweek article in 2006 title “nightmare mortgages.” Of course, Wall Street is no longer buying this crap so that $500 billion is going to implode and no one is going to stop it. Also, you need to remember that 60 percent of that mortgage portfolio of Pay Option ARMs is here in sunny California making us confront a $300 billion time bomb.”
July 24th, 2008 at 1:39 pm
I live in Fullerton, I have so for 10 years now. The first place I lived in for 6 years my rent went up I think a total of $50 or less than 2% a year. The place I am in now has gone up $75 in 4 years, which is about 2.5% a year or less on average.
Now I dont live in a premium apt. or anything. I do so for a reason, I dont feel it is worth paying huge rent to someone else. This allows me to save more $$, pay off more bills and just wait the market out.
I guess it is possible that rents are rising that fast, but Im not sure where. On another note, I have seen alot of people move out of my complex over the last few weeks…that place is getting empty.
Im contemplating ask for a rent reduction…tell them I am looking to move to another place closer to downtown or something.
July 24th, 2008 at 1:47 pm
look at Downey Savings. It closed today at $1.80
http://finance.yahoo.com/q/bc?s=DSL&t=1y
The stock was $60 less than a year ago. Ouch, ouch, ouch!!!!
July 24th, 2008 at 2:57 pm
……….. looks like the suckers rally is over……….
July 24th, 2008 at 4:29 pm
market down due to RE numbers…it will remain in flux until housing shows stability. You might want to short 50% of your retirement portfolio.
July 24th, 2008 at 5:05 pm
BTW Capboy: still looking for my “prices never drop by the beach post?” Or are you going to post it from Thoughtful or Jimmy and blame me of multi-personalities? Perhaps you will find it prior to the next mixer.
July 24th, 2008 at 11:01 pm
Ease-up Mulli.
How’s the price-landslide-proof Pacific Hills doing?
I only ask since you know it so well and I wondered about this one:
35 Risero Dr Mission Viejo, CA 92692
Price: $649,000
Beds: 3
Baths: 3
Sq. Ft.: 1,937
$/Sq. Ft.: $335
Lot Size: 5,406 Sq. Ft.
Property Type: Single Family Residence
Style: Traditional
Year Built: 1994
Stories: 2 Levels
View: Canyon, City Lights, Hills, Mountain
Area: Mission Viejo South
County: Orange
MLS#: U7004763
Source: SoCalMLS
Status: Active
On Redfin: 253 days
Unsold in 90+ days
Turnkey Lewis home. Located on elevated lot with views of the canyon, city lights at night, hills, mountain and Green Belt. Remodeled kitchen, new hardwood throughout. Wood shutters. Plasma T.V’s and built in surround sound. Carpet upstairs. Access to Mission Viejo Lake. A must see.
Listing Price Information
* List Price (High): $649,000
* List Price (Low): $649,000
* Original List Price: $749,000
* Previous Price: $719,000
* Search Price (High): $649,000
* Search Price (Low): $649,000
——
253 days on the market and 100K price reduction.
Better move to the beach while you can, Mulli, my man:)
July 24th, 2008 at 11:19 pm
Mulli !!!!
It’s worse than that!
Zillow showed it reaching a high of 851K two years ago……worth 674K now, so they are in the ballpark, but look at this:
* Value Range: $593,120 - $721,180
* 30-day change: -$7,000
* Zestimate updated: 07/23/2008
Last sale and tax info
Sold 02/11/2004:
$635,000
2007 Property Tax:
$7,809
——–
So, the ever wonderful Pacific Hills is back to 2004 prices? 4 years = zero equity? — But the taxes were only $7800/yr
Seems it’s been awhile since some of the ever-name-changing bears (ENCBs) have used the pejorative “Bitter Renter” refrain.
Your renters in the hood are truly happy campers.