Mike’s Predictions for 2012 Orange County Real Estate

First, these predictions are for entertainment only, like out motto “Entertaining and and Insightful Marking Analysis”. Please do base your home or investment decision on my predictions. Please do your own due diligence.

OK, is this what I think will happen with Orange County Real Estate and some national issues like Fannie, Freddie, and FHA. Please fill free to add your own predictions in the comments section.

• Orange County SFR Median Price - We will continue to see drops in the median price over 10% in some areas.
• Orange Country Townhome/Condo Median Price – I think we see a big correction in this median prices. It’s already started to happen and HOA fee’s have increased much faster than inflation.
• Sale Volume – Will be slightly higher in 2012, especially for home prices under $250,000
• Rents – We will see some increases in rents, but without improvements in the job market I don’t see a lot of increase. Plus, a lot units will be coming on the market in 2012.
• Delinquencies and Defaults – About 14 million home with mortgages are under water and we will see big increases in Strategic Defaults. There will be an increase in shadow inventory.
• Mortgage Rates – Toward the 2012 they will be in the 5% to 5.5% range to US credit rating concerns, GSE fee increases, and mortgage taxes.
• GSE fees - To help a float Fannie and Freddie will have the increase their fees in 2012.
• Mortgage Tax – I have another post coming out, but this tax was past with little noise from the US tax payer expect an increase in this tax
• Fannie and Freddie – They won’t be privatized since it’s an election. I guessing some sort of patch then issue will be addressed in 2013
• Fannie and Freddie Loan Ceiling – I know it’s sounds like a long shot, but I think the loan ceilings will be lowered again.
• FHA - Is in real trouble and they only predicted they won’t need a bailout because home prices will increase 2012. Look for major changes in the program like much lower ceiling levels toward the end of the year. Plus, an increase in the down payment to 5%.
• Home Building - So much shadow inventory, it going to take years to recover.
• Bank of America – It will not go bankrupt. They will get a shadow loan from the Federal Reserve. I see the government letting this big bank go under.

Am I going to make predictions for 2013 right now? No way, the market is too volatile. In 2009, I called in a local radio show real estate show and stated it will be until 2013 until we see normal market again. I was laughed off the show say we would be in trouble if it took that long. Thinking back, that was too optimistic of a prediction.

If you have predictions please put them in the comments. I really want to read them.

This house has been on the market for 305 days. Interesting it’s around the market costs for the neighborhood. I wonder if this house needs some repairs and you are not seeing the reason why this house hasn’t sold.
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Proprietary OC Housing News home purchase analysis

565 South WELLINGTON Rd

$470,000 …….. Asking Price
$805,000 ………. Purchase Price
5/25/2006 ………. Purchase Date

($335,000) ………. Gross Gain (Loss)
($64,400) ………… Commissions and Costs at 8%
============================================
($399,400) ………. Net Gain (Loss)
============================================
-41.6% ………. Gross Percent Change
-49.6% ………. Net Percent Change
-9.2% ………… Annual Appreciation

Cost of Home Ownership
——————————————————————————
$470,000 …….. Asking Price
$16,450 ………… 3.5% Down FHA Financing
3.96% …………. Mortgage Interest Rate
30 ……………… Number of Years
$453,550 …….. Mortgage
$123,921 ………. Income Requirement

$2,155 ………… Monthly Mortgage Payment
$407 ………… Property Tax at 1.04%
$0 ………… Mello Roos & Special Taxes
$118 ………… Homeowners Insurance at 0.3%
$522 ………… Private Mortgage Insurance
$0 ………… Homeowners Association Fees
============================================
$3,201 ………. Monthly Cash Outlays

($333) ………. Tax Savings
($658) ………. Equity Hidden in Payment
$22 ………….. Lost Income to Down Payment
$138 ………….. Maintenance and Replacement Reserves
============================================
$2,370 ………. Monthly Cost of Ownership

Cash Acquisition Demands
——————————————————————————
$6,200 ………… Furnishing and Move In at 1% + $1,500
$6,200 ………… Closing Costs at 1% + $1,500
$4,536 ………… Interest Points
$16,450 ………… Down Payment
============================================
$33,386 ………. Total Cash Costs
$36,300 ………. Emergency Cash Reserves
============================================
$69,686 ………. Total Savings Needed
——————————————————————————————————————————————-
This property is available for sale via the MLS.
Please contact Shevy Akason, #01836707
949.769.1599……
sales@ochousingnews.com…..

We're sorry, but it seems that we're having some problems loading MLS # P772139 from our database. Please check back soon.

	$595,000 537 South PROSPECT St		0.05 miles 4 bd / 2.25 ba 2,279 Sq. Ft.
	$499,900 477 South PROSPECT St		0.12 miles 4 bd / 2.5 ba 2,351 Sq. Ft.
	$549,000 12671 DUNAS Rd		0.15 miles 3 bd / 2.5 ba 2,404 Sq. Ft.
	$399,000 492 South SWIDLER Pl		0.25 miles 3 bd / 2 ba 2,029 Sq. Ft.
	$560,000 222 South VIOLET Ln		0.44 miles 4 bd / 2.75 ba 2,785 Sq. Ft.
	$405,000 840 South YORBA St		0.61 miles 4 bd / 3.5 ba 2,213 Sq. Ft.
	$399,888 2214 East DEBORAH Ln		0.66 miles 4 bd / 2.5 ba 2,666 Sq. Ft.
	$739,000 13191 KOOTENAY		0.68 miles 3 bd / 2 ba 2,034 Sq. Ft

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