Rossmoor, Coto sellers cut home prices most often

March 26th, 2009, 2:33 am · 38 Comments · posted by Jon Lansner

Town	Reduced	List	Cut
Rossmoor	68.8%	$815,000	10%
Coto de Caza	67.8%	$999,900	10%
San Clemente	60.3%	$789,000	11%
Newport Coast	59.3%	$3,095,000	9%
Dana Point	58.1%	$849,998	10%
Newport Beach	57.6%	$1,675,000	10%
Villa Park	57.1%	$1,199,000	9%
Los Alamitos	55.9%	$525,000	7%
San Juan Capo	55.0%	$550,000	14%
Laguna Beach	54.7%	$1,895,000	10%

Perhaps the upper crust is taking cues from the lower rung.

The local housing market’s theme in recent months has been this: Cheaper homes have been heaviliy discounted, leading to a boost of sales in the county’s more affordable communities. Owners of pricier homes have, to date, stuck to firmer pricing.

As a result, for the most part, sales have slumped at the top of the market. For example, homebuying is down in O.C.’s beach-close ZIPs!

Online brokerage Redfin sorted through the asking prices of homes listed for sale — brokers’ MLS, owners’ FSBO or banks’ REO — and tracked which O.C. communities had the highest share of residences “that were price-reduced at some point before leaving the market (either sold or removed unsold from the market) in the past 90 days.”

And guess what they found? Some of the widest price cutting comes from towns near the top of housing’s food chain.

This month, for example, the towns with the highest share of homes with asking prices reduced are Rossmoor (median asking price of $815,000) and Coto de Caza ($999,900.) Roughly 2 of every 3 homes in these towns had price reductions before sale of departing the market.

(See chart of Top 10 O.C. towns for share of homes with prices reduced; median asking prices; and the typical size of thoir discounts. The rest of the analysis IS HERE!)

Other housing stories …

… in the lending world …

… from South County …

… and Surf City:

Psst! Redfin did note that cities/towns or neighborhoods in which the number of homes taken off the market was too small to provide believable estimates are excluded from ranking.

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dapper1 says:

March 26, 2009 at 5 am

The cuts will continue..
People in the middle have lost all of their equity or are underwater so they can’t trade up…
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Only those with REAL money will be able to by at that level and really, there aren’t that many who can.
It’s my opinion that the high end will drop to what the middle was during the bubble and so forth; then we may start to recover.

Dina says:

March 26, 2009 at 6 am

Welcome to the third world.

Gunner says:

March 26, 2009 at 7 am

There does not have to be that many to buy the high end because there are not that many high end homes anyways. Just takes one buyer and one seller to make a transaction. There are 20 million people in Socal. If YOU dont have the money to afford a nice home, there certainly is someone else that can. These high priced homes have come down so much because of a few people that over extended, now is the best time ever to get a great deal. Whoever does buy these homes will be filthy rich in the future.

NationalBubble.com says:

I live in Newport and I see the same houses in the market month after month. They keep lowering the prices and chasing the market down. The smart sellers get in front of the declining market, cut their asking price, and are able to sell.
The rest, keep hoping for some bailout from the government which will not happen and keep paying those huge property taxes.
There is no bailout for rich people. Obama is opposed to bailout rich people out because he believes that rich people should have known better.

Furthermore, huge tax increases are coming for rich people, lowering of the mortgage deduction benefit and charity contribution deductions. All this will put even more pressure on the high end market. The bottom for the 1million + homes is at least 2 years away.

With 20 million people living in SC, how many can afford a $900K home? With roughly $7,000 a month payment (everything) you have to be making $250 - 270 a year.
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There aren’t that many people making that kind of money. Filthy Rich? Maybe after prices drop further and then STABILIZE… incomes will have to catch up first, then they might make something.
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Bubble, I live in the Newport too and I see the very same thing.

Olivas Salone says:

Bubbie and Dapper, are you the 2 guys that sleep under the pier?

There are tons of people that make $250K+ more a year. There are 200K lawyers and 100K doctors in CA. There are even more executives and successful business owners that make at least that. Yes, there is a huge pool of people and only 500 homes around $900K in the OC. So, it is only a question of whether they choose to buy or not.

So, you can pick a few homes and a few neighborhoods that have houses on the market that are not selling immediately, but this totally misses the big picture. And it also shows the prevalent fear in the market which is a great buying opportunity. Now is the time to buy at these great mortgage rates and great home values. The more home you buy, the richer you will be in the future.

I have on occasion crawled out of Blackies and stumbled home… but never under the pier.
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Olivas, why don’t you do something other then pick a blog fight.
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You’re clueless about History, Government, and the Financial World and your post are without merit. Go grab another Ding Dong and bulk up.

waitingforgodot says:

Olivas,

Come on man. I have no problem with your making fun of people you think are over zealous or missing the point, but do the same for the bulls who make ridiculous claims that are nothiing short of moronic.

Gunner, everything I see for sale in my neighborhood has been discounted. (900 - 1.5 range.)
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I do agree that the market is now being driven by fear, but for a good reason. People are loosing their jobs like crazy. Incomes are stagnant and homes are over-priced.
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Don’t count the Doctors anymore, Health Care reform is next.

Bogey says:

Gunner Says:
March 26th, 2009 at 7:40 am So, it is only a question of whether they choose to buy or not.

There is no question. They’re not buying. All you have to do is look at the stats. If you had a clue you would already know…but, if you look at what you post here, it’s obvious you don’t.

awgee says:

March 26, 2009 at 8 am

Gunner - Are you buying?

lee in irvine says:

We’re gonna see McMansions sell for less than $150 a square foot in Coto before this is over. There are already listings that exceed 4,000 square feet offered for less than $230 a square foot.
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Many pretenders of wealth have been exposed as frauds. And this process is in about the 3rd inning. The next shoe to fall … Newport, CdM, and Laguna.

mj says:

March 26, 2009 at 10 am

Gunner is obviously a broker or RE agent? His comments are sounding the same and like a commercial? Are you even seeing the reality of what is happening?

not buying it says:

Gunner: so let me get this straight - all those doctors are in the market for a home. Business owners, wealthy people.

Are you NUTS?!?!?

They ALREADY OWN!!!! Why do you generalize and simplify real concepts that you obvioulsy have no idea what you are talking about?

How many 1mil priced homes sold last month? How many were lawyers or doctors? I would guess a VERY SMALL PERCENTAGE.

Man - where did you get your schooling from? The Gary Watts School of Pushing Wool?

Seems to me you are quite jealous of those people, much like myself, that know how to run successful businesses, how to leverage risk and how to avoid listening to people like yourself that have no clue as to how the markets work.

I even bet you are in the business - so man, you need to go get yourself EDUMACATED before everyone on this blog sees the smoke screen and more importantly, the fear, in your words. Then you won’t be able to convince a single buyer to do anything but wait for better deals.

The short sales -and there are a TON of them - will be foreclosures soon. MANY homes have yet to hit the market. The FED’s plan to subsidize PUTS for investors ot buy garbage assets will not work well for CA - the talk is already going around town (NYC that is). CA assets are taking the biggest hits from original value. Buyer pool income supports a median of around $450 to $500 in the OC itself - at best, with traditional lending restrictions. You know how many self employed small business owners (majority of the higher income brackets) are getting $500K loans? Not many from what I see.

So Gunner believes that incomes and not lending standards will turn this market around.

Hmmm - quite insightful and a very unique opinion. LMFAO

I know the stupid people with the means are not buying and there are tons of stupid people. The few smart ones are buying. This is why not everyone is rich, only a small minority. The minority that has the courage and the money to buy when others are selling. You see all the foreigners coming over and gobling up properties? They are the smart ones taking advantage of dumb Americans.
I am not buying–I don’t have much money and not enough courage. But if I did, I would be gobbling up like crazy.
Keep the big picture in mind..only a small minority of all workers are losing their jobs and only a small minority of all houses are in trouble.

Eat it in the OC says:

March 26, 2009 at 11 am

Gunner, are you an victim of PTSD? Look, it’s great that you think now is wonderful time to buy and that if we don’t were all fools. But you don’t have any money, so you can’t put your money where your mouth is. This leaves you with no credibility what-so-ever. See the OC graph in the previous post. That curve isn’t going to change it’s trajectory any time soon. The lower mortgage rates and incentives will slow it but the correction is going to happen. Say goodbye to fraud equity.

March 26, 2009 at 12 pm

Gunner - I am one of those who sold when everyone else was buying. And now I am waiting. The bottom is no where in sight. The hardest thing to do in investing is to wait. And I will buy at the bottom, after 2012.

Lastly, you will never make money as a real estate agent unless you develop integrity and character. Those with money will not trust you and they are smart enough to know whom they can trust. Only in win-win books is business about win at all costs. Long term success in business, as in life, is dependent upon long term relationships, honesty, and trust.

Sean says:

***OFF THE TOPIC****

Does anyone know if I would to short sale my property and a relative would to buy it from the lender and rent the house to me, then eventually sell it back to me in a few years. Are they any special conditions for doing such a transaction? Have you heard of anyone trying this?

Thanks,
Sean

March 26, 2009 at 1 pm

Dapper you’re not serious are you? What a joke.

And leave my Ding Dong out of it

awgee–2012 will be the next top of the cycle…we are heading up there now. Good luck housing yourself with dollar bills. Like the great band Rage Against the Machine sang–”Know Your Enemy”. Ya, those that are my allies are in it for a win-win situation with me. My enemies–those competiting against me for the limited resources out there–are and will be crushed. Every conqueror has an enemy. Who is yours?

WFG, The Bulls have one thing all you self proclaimed geniuses don’t; a sense of humor. Maybe if you guys did’nt enjoy others suffering whether deserved or not, so much, I’d lay off. But you guys got this holier than thou, stick up yer patooty attitude that really grates on my nerve. And remember you guys picked the fight I didn’t. I get called idiot and because you guys think your sh#t don’t stink I got to genuflect and yell Thank you Sir May I Have Another. I don’t think so.

cantaffordtobuy says:

“Keep the big picture in mind..only a small minority of all workers are losing their jobs and only a small minority of all houses are in trouble.”

others on the blog are saying just the opposite. are you just talking over 900K?

Try this:
http://www.redfin.com
search southern california
zoom in to the area of interest to you
search “homes” (uncheck condo, apt. townhomes.).
uncheck “exclude short sales”

many of the areas I’m looking into, mainly Mission Viejo. Will have 1/3 to 1/2 of the homes listed as Short sales - depending on my search criteria.

Also, once you exclude the short sales poke around on what is left - REO and “Equity Sellers”. All the Equity Sellers have prices at the higher end. REOs are priced lower.

Short sales and REOs to me say - distressed sales = pricing pressure downwards.

O…
Dealtracker took it to me the other day and I admitted I was full of it. so my poo does stink.
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I don’t have a sense of humor about the fact that our economy is in the tank thanks to fraudulent lending and purchasing which is effecting those that didn’t get involved.
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and yes, I will leave your Ding Dong out of it.

March 26, 2009 at 2 pm

Cantaffordtobuy–There are 33K homes for 100K people in MV. There are 500 homes for sale and if 1/3 are short sales that would be 166 homes out of 33K that are in trouble…or .5%…
So, all you doom and gloomers are panicking over .5%!! This is what I mean when you don’t look at the big picture and fear brings prices down to where the opportunists can take over. Okay, class dismissed.

“WFG, The Bulls have one thing all you self proclaimed geniuses don’t; a sense of humor.”

I’ve got to disagree. I’m the funniest guy I know.

Okay Gunner, you already have it figure out. You surely do not need any advice from me.

Olivas.
Don’t know if that’s a Bull or Bear, but it’s funny.

nevermind, it didn’t post.

rants says:

March 26, 2009 at 3 pm

XTRA XTRA READ ALL ABOUT IT- POLITICIANS , ECONOMISTS AND REALTORS ALL AGREE— THE WORST IS NOW BEHIND US–

http://www.opednews.com/populum/print_friendly.php?p=More-Famous-Quotes-For-Per-by-Allen-L-Roland-090228-499.html

nanowest says:

March 26, 2009 at 5 pm

I declare gunner the new village idiot. He seems to be too naive to understand how foolish his comment are. You replace truthi !!!!!!!!

March 26, 2009 at 8 pm

Gunner - inventory levels are quite normal for this time of year - unfortunately, the amount of distressed properties is NOT normal by any means. You can try and paint a picture that its over - but what you don’t understand is that its not over.

You see this is how it goes. Buyers ARE buying. They are BUYING what they can AFFORD!!! Hence the low median. So, given the fact that sub $500K homes are sort of selling well and $500K+ homes are not - do you think its because people are sitting on the sidelines in fear? Or are they out there getting DENIED?!? There are a few that choose to closely watch the market and research. I MEAN A FEW!! Just so happens they are here on this blog as well. Come on man, you do drink coffee don’t you? I advise not sticking with the decaf and move onto the harder stuff.

All this speculation is ridiculous. Look at the damn numbers - what do they tell you? Cheap homes are selling. Have you seen the denial rates for people trying to buy homes above $600K? Also - get this - back in the day, a schmuck could get a 4% ARM on $600K!!! That same schmuck is now wondering why he’s being asked to prove if he can make a payment on a $300K loan if he suddenly lost his job - hence the reserve requirement. FHA and HUD is what buyers are using in droves. The only thing that can get them is a condo or SFR in a not so great part of town. I mean - this is common knowledge - not some rant. Who has data to dispute this? I would love to see it - and frankly, change my mind. I’m feeling pretty bad for buying a rental property for cash at 45% discount to see that first time buyers now buying on that same block for about the same price.

Olivas: You made a mistake. You have to BUY if you are BULL. If you ain’t buying - you ain’t a bull. You’re a wannabe.

March 27, 2009 at 7 am

Not buying it—you have to sell if you are a bear. Let me know where your rental property is, I know a ton of people ready to gobble up your discounted investment :)
Ya, not many people are choosing to buy the above median homes. So what? They have the means, they are just sitting on the sidelines waiting for positive indication the economy has rebounded. Well, these are the folks that will be buying at the next peak of the cycle. By the time there is positive indication, it is TOO LATE. The smart ones are buying now! They see tremendous discounts in an environment of fear.

Not Buying It,
Sez you, I don’t play by your fiat rules knucklehead.

Slice	Price	Ch.	Sold	Ch.
House	$500,000	+18%	1,833	+11%
Condo	$290,000	+7%	881	+22%
New	$617,500	+24%	171	-17%
All OC	$435,000	+10%	2,885	+12%

Orange County Register