Erin Kociela

Wow, Anthony--there's no quick answer. Great homes in great areas in great condition will lose less value than distressed properties. At nearly $80,000 less than the last sale (and selling for less than what is currently owed on it), you already know that it is a "good" deal. Add to that the fact that you really like it , and, I'm assuming, want to live there for the next 3-5 years, so the only real question is are you over paying?

Here's a few things to keep in mind.
1) Your agent will be able to provide you with the recent comps in the development, as well as the current market situation. In many cases, we're seeing short sale and bank-owned properties in this price range selling in a matter of days with multiple offers. Remember, these are not normal sellers. These types of properties are already at the bottom of the market. That said, the bank may have approved a price that was submitted months ago--and is no longer accurate. Only your agent can tell you for sure.
2) Many buyers will hold to their guns about paying $5000 less than the asking price--but will then lose thousands more when interest rates go up a quarter of a percent. That's penny wise and pound foolish. In many instances, it's better to pay more and get a lower interest rate. With rates on the rise, in many cases you do better locking in a higher sale price and lower interest rate right now.
3) Although you can write an offer for lower than the bank-approved amount, the bank does not have to accept it, and may takes weeks or months to respond to your offer--if they do at all.
Short sales are a complicated animal--be sure to work with an agent who has experience in bank negotiations--even then they can be a bear.
Good Luck! - Thu Jul 24 2008, 11:23

There are some general "rules of thumb" in property investing--I say in general because there are always exceptions. The condo rule is you want 3 bedrooms with a 2 car enclosed and attached garage, preferrably with inside laundry, although separate laundry in an attached garage will do.

For houses, it is 4 bedrooms with the same 2 car enclosed and attached garage.

That said, it all comes down to preference at some point. Would you rather have a 2 bedroom condo in Irvine or a 3 bedroom condo in Tustin Ranch? It all depends on what's available, the condition, and the price. Your renter pool for Irvine/Lake Forest/Tustin Ranch will all look pretty similar. - Mon Jul 21 2008, 13:27

Hi, KC -- He's/She's correct--sort of. There are many different types of "property" tax--the standard 1% that is everywhere, plus additional amounts of taxes for bond initiatives that have been voted on and approved by the homeowners in that particular area. There can also be assessments for fire, water, etc. In addition, Irvine has a number of neighborhoods with Mello Roos tax--a separate, additional tax that is added by the builder/city at the time the development is being built. Mello Roos is also referred to as a "tax."

Mello Roos can be high or low, depending on the development (that's why you'll see listings with the note, "No Mello Roos" or "Low Mello Roos."

The good news? There are plenty of great investment opportunities in your price range here in Orange County at the moment--both in Irvine and adjacent cities. So find an agent you'd like to work with, get preapproved by a lender (your agent can help) and go for it.

Best of luck.

Erin - Mon Jul 21 2008, 12:44

Hi, Mr. or Ms. Johnson. All the answers so far are great ones -- but the bigger issue is where, exactly, is North Tustin and what are the values in the different areas. Any credible realtor can pull you the comps for 92705 from the Multiple Listing Service -- but not all comps are created equal. 92705 - or technically "Unincorporated Santa Ana," is bordered by three different cities--the city of Santa Ana, the city of Tustin, and the City of Orange. That said, there are three different school districts servicing homes in 92705, and each has a very different impact on home values. In fact, even within each school district, certain Elementary Schools are more in demand than others, and increase (or decrease) property values.

A good example is the street Fairhaven Extension. If you live on the South Side of Fairhaven Extension, you kids will go to Foothill High School in the Tustin Unified School District. If, however, you live across the street on the North side of Fairhaven Extension, your children will go to El Modena High School, part of the Orange Unified School District.

Whether this is a good or bad thing is completely personal. If your kids are already in the Orange School DIstrict, this means that you can live in North Tustin, but keep them in Orange Schools--plus, the cost of the North Tustin home will be more comparable to costs for homes in Orange, which means, generally, more affordable.

In the Tustin Unified District, Arroyo Elementary is the most preferred elementary... although they're all excellent!... and homes within the Arroyo district often get a premium price.

Head West in 92705, and you may run into the Santa Ana Unified School District, while a home just across the road will be Orange Unified.

What is the best property for you? That all depends on your personal needs. Work with a professional realtor who 1) You like, and 2) who specializes in the area you're interested in. It's a great time to buy, so go find your dream house! - Mon Jun 23 2008, 16:08

Hi, Qamar. About 50% of the business I'm doing at the moment in OC is either in Short Sales or Bank Owned Properties (REO). Some unbelieveable deals are available, but Short Sales, in particular, can be extremely messy to deal with. This is often because they price the homes lower than the real value to obtain multiple offers, then have to wait for the bank (or multiple banks--a real issue) to agree to accept an offer. Bank owned REO's can be easier because you only need to negotiate with the Bank, however you'll often be up against multiple offers--plus, if the property needs repair, The property may not appraise high enough for you to get a loan unless you have an extremely high down payment.

Be sure you're working with an agent who has experience negotiating with Banks and who can help you make sure you're positioned properly to get that great deal!

Erin - Thu Jun 5 2008, 11:19