OC Home Prices: Still Fucked Up

In 2003 the current owner of this 4 bedroom, 2 bath house in Lake Forest, California purchase it for $340,000. Three years later he wants sell the house for $599,000 thereby earning - hey, why not? - $260,000 profit!The house has been on the market for 12 days, and according to the realtor, everybody better "hurry" the hell up, because it "won't last".

Nevermind the fact that the owner could never afford to buy the home himself at the sale price.

So what is it exactly that makes an Orange County homeowner rationalize their right to a $260,000 profit on a tiny 4 bedroom home, built before the Reagan presidency, with no backyard?

a.) "My realtor said that's how much the house is worth."
b.) "Everyone else is doin' it and getting away with it!"
c.) "The great sunny weather, mild temperatures and family community of Lake Forest contribute to the home value and justify the $600K asking price.
d.) "My neighbor sold his larger home for $650K. My home is comparable."

Well, which is it?

This may be what sellers are thinking. But more and more prospective buyers are deciding to hold their horses and wait on the sidelines. Things are starting to get ugly for the real estate market... and potentially very interesting.

Sales of homes in Orange County are on the decline. Foreclosures are on the rise by 75% year-to-date 2006. Median home prices in OC remain high at $633,000, over 10 times the median family income. Now may not be the right time to buy a home.

State of California: "We're Fed Up with You Pollution-Causing Automakers!"

Let the sue-age begin!
Since no one up to this point has had the balls to say or doing anything about it, the big, bad state of California is suing the ass off of Ford Motor Corp., General Motors Corp. and Toyota because it claims that the emissions of the vehicles manufactured and sold are costing millions of dollars to the state.
Before anyone scoffs at this news, ask yourself whether you have been to Southern California recently? Next time you come, look around you and then toward the horizon at sunset.



Yeah, see that brownish-blue shit in the horizon!? We're all breathing in that crap!

I'm not sure the rage is appropriately placed with the auto manufacturers, since they are all simply following the emission standards of the Federal Government.

So here's an idea for the California state attorney general:

1.) Since smog is such a costly problem for the state, re-set statewide California emissions standards to a stricter level. Force manufacturers to comply.

2.) Let the most fuel efficient, least polluting manufacturer win the market.

3.) Form a coalition of other states that would agree to the same standards and have them follow suit.

More Americans Failing To Pay Monthly Mortgage

More frightening news regarding the national real estate market. And it's only going to get worse. "Underwater" homeowners trying to sell their homes may only encounter more frustration, since home sales are declining nationally.

Meanwhile potential home buyers, receiving a steady diet of real estate value warnings from the national and financial media, will likely wait as long as it takes until the market hits bottom.

OC Gas Prices Take Massive Dive

Massive and obscenely huge SUV drivers in Orange County can breath a slight sigh of relief this week. In Lake Forest, CA today gasoline prices are down to $2.87 per gallon. This is an almost $0.50 per gallon decline from the price of fuel in May of approximately $3.36 per gallon. The price per barrel of oil has dropped to $62.00, the lowest in 16 years.


So drink up, Orange County Ford Exploder and Cadillac Escalade drivers!
Also, it's not too late to remove the "fore sale" sign off that extended cab pickup or 20 foot speed boat you own either.

Greed is Good. Ohh..wait a minute, no it's not!

Poor Bob Toll.
According to him, if it weren't for all the greed and speculation of buyers and sellers in the U.S. housing market, happy days would be here again!

Come on Bob, what about the famous line of the character Gordon Gekko in the 1987 classic film "Wallstreet"?

After all, "Greed is good."

Well, maybe it's just me, but it I find it curious that Bob Toll and the real estate industrial complex, including realtors, homebuilders and mortgage brokers would consider themselves so overqualified an authority to preach to the market and the American public about the vice of greed.

What's that classic Old English adage: "The pot calling the kettle black"?

(Bob Toll is the CEO of Toll Brothers, Inc., which designs, builds, markets and arranges financing for single-family detached and attached homes in luxury residential communities.)