Sunday, April 26, 2009
2005 must have been an interesting year in the Orange County housing market.
I mean, could things have gone any better for homesellers, buyers and flippers at the same time? No way! College textbooks will no doubt include case studies about 2005 as the year of idiocy, of the seemingly unending, carefree, unregulated, real estate orgy.
15%+ appreciation on home sales. Skyrocketing home prices. Champagne and chocolate fountains. Hot hors d'oerves. And of course, parties around OC would not have been complete without the loud, depreciating jokes about foolish renters and housing market doomsayers.
"I just bought a new SF home for $700K last weekend! Guys, I'm so rich now!!!"
Four years later we can only look back at this period with our heads cocked to the side and a "WTF?" look of grimace on our faces.
That's all we can do. Because the damage is done. And like it not, we're all paying for it. Big time.
Today's example is 21892 Apache in Lake Forest. The location is appropriate. This is a beautiful 4 bedroom 3 bed, single family home with a massive backyard in lovely Lake Forest. The home is close to schools and far enough from the free way and the train to enjoy.
Now let's look at the ridiculous sales history that could only make sense to individuals in complete and utter denial, or in a drunken stupor of irrational exhuberance:
February 18, 2000: Sold $313,000
July 4, 2005: Sold for $700,000
November 14, 2005: Sold for $744,000
April 22, 2009: For Sale for $499,000
The greater fool asks: "So, uh...guys..like, where did my 15% per year home appreciation go?"
Oh, it's in our homedebtor bailout taxpayer checkbook. We'll go get it for you.
$499K for the same house that sold for 40% more before.
Now that's a home price haircut Apache-style.
Thanks again to the Orange County realtors, mortgage brokers, and financially inept borrowers for the greed and complete lack of integrity, and for all of those funny jokes.