Pardee Homes Drops Mello Roos in new development in Moorpark (Ventura)

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Submitted by BobbyD on January 8, 2007 - 2:09pm

Thanks to House Of Cards for this. Hopefully this will catch on in San Diego!

Pardee homes, Party is over.
PARDEE HOMES development in Moorpark just dropped their Mello-Roos for any homes closed after Jan. 1st 2007. This a significant blow to those people who had already purchased homes, as they are obligated to pay between $4,900 to $6,000 a year for 30 years. The resale value of homes with Mello-Roos versus those without will be significantly different. Some quotes in today Ventura-Star:

The house was unfinished, but Ann and Rusty Colemon closed the deal for their new Moorpark Highlands home anyway in December. In exchange for signing before the end of the year, they say builder Pardee Homes offered them nicer fixtures and no mortgage payments until the house is finished.
But if they had waited a few days for a special assessment to be waived, they would have saved about $150,000.

"We would have waited to close if we'd known," Ann Cole-mon said. "It's very hurtful that they had this knowledge and did not disclose this to us."
The Colemons are among dozens of 2006 homebuyers in the Moorpark Highlands neighborhood who are upset about Pardee Homes' new incentive for buyers there. As of Jan. 1, Moorpark Highlands purchasers won't have to pay the monthly charge known as a Mello-Roos assessment, which funds community improvements in the tract. Instead, Pardee will cover the cost.
Those who bought before Jan. 1, however, still must pay the assessment, which they said can run between $4,900 and $6,000 annually depending on a home's size, for more than 30 years.

New home developers traditionally try and not reduce prices in their developments during slow times, because they will affect the resale value of everyone that has purchased before them. The list price shown on the tax rolls remains unaffected, but there will be a significant divide between homes in the developments with Mello-Roos and without.

Moorpark Highlands was the first new home development I visited in my home shopping experience back in March of 2006. Back then, the sales staff barely acknowledge the visitors, never getting off their stools to hand out brochures and fliers. I visited the houses with great interest as, relative to the market at the time, 650-700k seemed like a pretty good deal for a new home. After looking at the houses I asked the sales staff a few questions, "Do you work with real estate agents?" (Absolutely not, was the reply), "If I am interested in buying a home, what is the next step?" (Throw a couple forms at me and send me on my way). Now, I didn't exactly expect them to fellate me when asking about purchasing their homes, but I would expect a sales person to do some salesmanship to people showing interest in their homes.

I went home and crunched the numbers and rapidly came to realize that between HOA dues ($250+), landscape tax (~$1,500), and Mello-Roos ($4,500-6,000) it would be a better value to buy a $800k resale home (yearly it came out the same amount) or save the money and buy a 650k resale home. But I thought Pardee must really be selling a lot of houses because the sales staff was doing so little. Arrogance is prevalent during the good times. About once a month I went by the development and it seemed foot traffic was still ok, sales staff still unmotivated, and in general nothing changed. But watching their website and emails, someone at the head office was clearly getting nervous. You will now see a 3% broker coop being offered (trying to draw buyers off the existing home sales market by giving a broker split to real estate agents), and many incentives, financing, giveaways, and offers coming in your mailbox. One only has to look to Florida, Las Vegas, and Phoenix to see what happens when a developer gets motivated to move homes. Previous buyers are left out in the cold, with new buyers getting upgraded houses, lots, and financing which ultimately makes their houses worth more when going to sell them again.

Last November was the final time I visited Moorpark Highlands, It was during a weekend where they were giving away a free refrigerator and television with each purchase. At Shenandoah I actually had one sales person mention that she was trying to give away a TV and that we should buy. It might be a small thing, but at least their was SOME sort of salesmanship going on (even if it was only one person) after several months and many visits. Personally, I think with the market being as soft as it is, the position of the houses in Moorpark (not a great area), and how far the development is from job centers relative to price, I think the next step is a list price reduction. If you look at the history they have gone from offering nothing to offering broker coop, adding upgrades, giveaways, "creative" financing, and dropping Mello-Roos, it seems their are running out of room of things to do to move homes.

Maybe another trip to Moorpark is in order, I will keep you updated.

Posted by House Of Cards at 7:00 AM

Submitted by PerryChase on January 8, 2007 - 2:38pm.

Interesting to watch the psychology of the market. So during the boom times, builders will pass along more fees to the homeowners because they know that people will pay just about any price. When times are slow, builders have less pricing power and must absorb the development costs. At least in housing, higher costs do not lead to inflation -- as long as there are still profits to be made.

Submitted by Diego Mamani on January 8, 2007 - 3:08pm.

Good post Bobby D!
Strictly speaking, the builder is not dropping the M-R. Rather, Pardee is paying for it in one lump sum (instead of the homeowner paying over many years).

This is another way of reducing the effective price that is not captured by the data.

Submitted by barnaby33 on January 8, 2007 - 10:03pm.

This links to the previous thread.

Submitted by VanMorrisonFan on January 9, 2007 - 9:09am.

What is the typical sales price in this development? If the developer absorbs the Mello-Roos Fees of $150,000, what does that represent as a percent of the purchase price of the home? Just curious.

Submitted by Cow_tipping on January 9, 2007 - 9:42am.

Mello roos typically is 30-50K. You have it financed just like your loan. The payments over 30 years total to 150K.
Just what I think.

Submitted by IONEGARM on January 9, 2007 - 11:21am.

Mello-Roos seems to be more like a property tax which is due the same time your property tax is due.

Real Estate Headquarters for SFV and Conejo Valleys

Submitted by BobbyD on January 9, 2007 - 11:34am.

Mello-Roos is a form of financing that can be used by cities, counties, and special districts (such as school disricts). Mello-Roos Community Facilities Districts (referred to as "CFDs") raise money through special taxes that must be approved by 2/3rds of the voters within the district. A CFD is formed to finance major improvements and services within the district which might include schools, roads, libraries, police and fire protection services, or ambulance services. The taxes are secured by a continuing lien and are levied annually against property within the district.

A builder who develops a new housing tract development typically has to make certain improvements and put in the infrastructure to support the developments. If they do not foot the bill for all of these costs, they will work with the city/county to use CFDs to fund these costs.

In almost all cases, Mello-Roos special taxes are levied as part of the annual property tax bill. You should be able to find your Mello-Roos special tax as a line item on that bill. In rare cases, a Mello-Roos district will send out its own bill. To find out more about this bill, you will need to contact the agency directly.

Here is a link to learm how Mello-Roos or CFDs are formed:

Hope that helps explain Mello-Roos.

Submitted by william_busch on January 10, 2007 - 4:25pm.

I purchased a home in the Pardee Moorpark Highlands project. I have been involved with the sales process of buying a home since Feb 2005 when I signed up on Pardee's interest list. I had the very 1st pick of a home. Since day one, the Mello-Roos issue has been a cluster from the beginning. The sales force was clueless of any information, they told us to contact the city or gave us a third party number to call regarding the Mello-Roos. I couldn't believe how uneducated they were with this being one of the main issues buying in this development. I was aware that this project was Mello-Roos Community and did my research before buying and was ok with it.

The issue regarding Mello-Roos came to the forefront a few months back when Pardee gave new homebuyers a 5yrs paid Mello-Roos while current homeowners and those in enscrow were given 3yrs. The 10 to 12 current homeowners sent a letter to Pardee's President Mike McGee and the decision was changed and Pardee would give 5yrs for all homebuyers. However, there was a catch, the paid Mello-Roos was not transfered if the home was re-sold within the 5yr period. The homeowners don't have any issue paying the Mello-Roos, just as long as everyone pays for it.

On Thursday, January 4th, a few homeowners overheard that Pardee would be paying the full Mello-Roos for new homeowners. We notified the sales office that we wanted to talk to someone from Pardee or we would notify the media and picket the sales office. Pardee refused to talk to us, on Saturday and Sunday approx. 100-150 people picket the sales force and handed out "buyer beware" flyers. The Ventura County Star and Moorpark Acorn showed up and published our stories. We wanted to educate buyers on how Pardee treats it's valued customers, the people who have been there from the beginning. I realize the realestate market has slowed and Pardee needs to sell homes, but don't use the Mello-Roos to as the vehicle to provide the incentive.

Below is a copy of the letter we sent to Mike McGee with 100+ homehowner signatures.

I thought I would share this with you.

Bill Busch
Moorpark Highlands Homeowner

Michael V. McGee January 6, 2007
President and CEO
Pardee Homes
10880 Wilshire Boulevard, Suite 1900
Los Angeles, CA 90024

Dear Mr. McGee

Re: Pardee Homes payment of Mello-Roos for new home buyers in Moorpark Highlighlands

On Thursday January 4 2007, it was brought to our attention that Pardee would be paying the Community Facilities District (CFD) Assessments/Mello-Roos, No. 2004-1, Zone 3 (Moorpark Highlands) for prospective homebuyers. We do not agree and find it unethical that Pardee would offer a new homebuyer in the same CFD "no Mello-Roos", while current homeowners would potentially have to pay Mello-Roos until 2044/45.

In the Community Facitilies District Subsidy Agreement dated September 2005, Pardee committed to pay the amount of the CFD Assessments for five (5) year period commencing on the close of escrow for all the Moorpark Highlands releases. On January 4, 2007, we were told that this commitment has been modified for new home buyers This decision has left loyal Pardee homeowners upset with this unethical decision.

We are upset because our commitment to purchase a home in the Moorpark Highlands CFD extends back to January 2005. The Builder Assessment and Tax Disclosure Agreement stated that "all prospective purchases" in the CFD No. 2004-1, Zone 3, would have pay a Mello-Roos/Special Tax, the amount of which is based on the square footage of the home. Your recent action has resulted iin selected lots being burdened with the assessment over the long term. If we had known that only our specific lots were subject to Mello-Roos we would have never agreed to such irrational terms. We are concerned about the re-sale value of our homes iin comparison to a prospective homebuyer selling their home absent any Mello-Roos. Those of us who in good fath closed escrow prior to January 4th, 2007, have been denied an equal opportunity to have this Mello-Roos stigma tax removed from our properties. We perceived this as a deliberate division in the community. Should we choose to sell our home, we will be handicapped by this tax assessment while our neighbor will not.

We have stood by Pardee for up to two (2) years during this entire building process and have referred friends and family to buy a Pardee Home - and this is how Pardee treats thier loyal homeowners? A slogan printed on a Pardee notepad states that Pardee Homes wants their customers "to feel they can trust the organization and its people". The division in this community you are deliberately creating is in direct opposition of what your company supposedly stands for.

To resolve this issue, the current homeowners and those in escrow request fair and equitable treatment. Specifically, we are requesting Pardee Homes to pay off our Mello-Roos assessment too! We are fighting to preserve the future value of our homes, to maintain equity in this community, and preserve the neighborhood you promised us.

We are confident that the City of Moorpark shares our concern of an unethical treatment that appears to be affecting their residents in Moorpark.

We would appreciate a timely response and resolution to this issue. We expect Pardee to do the right thing.

The Undersigned Pardee Homeowners

cc: Jim Bizzelle, VP of Community Development, Pardee Homes
Patrick Hunter, Mayor, City of Moorpark
Amy Brandt, President and CEO, WMC Mortgage Corp.

Submitted by IONEGARM on January 10, 2007 - 4:46pm.


I would also think an effective strategy would be to have 1 person sit out in front of each the Shenandoah, Magnolia Lane, and Cherry Hill offices with a sign to educate any buyers coming in. This will really hurt their sales and since they are at the highest cost point in the development (paying all the interest for the already completed homes) I don't think they would have much choice but to give in.

p.s. May I post your letter to my blog?

Real Estate Headquarters for the SFV and Conejo Valleys

Submitted by PerryChase on January 10, 2007 - 4:58pm.

william_busch, how would you feel if Pardee would just reduce the selling prices of their houses by 150k? Actually, Pardee is trying to protect the value of your property by doing these round-about price cuts (incentives).

What is the right thing to do in a declining market? Builders need to continue to sell houses.

Gasoline may cost $2.50 today but if, tomorrow, gas drop to $2.00, am I entitled to a refund?

I remember, in 1990, homeowners in some developments had "for sale" sign on every garage to protest price cuts. Not a pretty sign for prospective buyers driving by.

Submitted by lendingbubbleco... on January 10, 2007 - 4:58pm.

"We expect Pardee to do the right thing."

As far I can see, Pardee (a business) is doing the right thing (making business decisions) and, therefore, there is no problem here.

Guess what? Picketing to hurt Pardee's sales can backfire. At some eventual lower price point, the "scabs", buyers in this case, will cross the picket lines. Can you really afford devestatingly lower comps??

Caveat Emptor.

Submitted by NeetaT on January 10, 2007 - 5:07pm.

Mello Roos seems to be a skimming operation. My assertion comes from what I've read about it.

Submitted by BobbyD on January 10, 2007 - 11:43pm.


Thank you for providing more details on this story and sharing your personal experience with Pardee in this situation. I think that we can all empathize with how you must feel. I would be equally as upset as you are if I was in your shoes.

As a friend of mine says, "never be surprised when someone acts in their own best interest". Which is what Pardee has done to serve their financial gains. It is indicative of a market in flux.

My best to you and the others in this unfortunate situation.

Submitted by william_busch on January 11, 2007 - 7:44am.

Bob, thank you again for letting me share my position on this topic. First I wanted to let IONEGARM know he has permission to post the letter that was addressed to Pardee's President, Mike McGee.

Also, in response to lendingbubbleco's comments; I take full resonsibility of purchasing my home from Pardee. I love my house, the area is great and it has been a real pleasure getting to know all my new neighbors. It's funny you refer to "Let the buyer beware" in your post script. That is exactly what was on our flyer that we gave to prospective homebuyers. Pardee has done and is still doing a horrible job with the Mello-Roos disclosure. It was my understanding and all the other homebuyers in the community would have a Mello-Roos. This doesn't just mean that every home will be assessed an addt'l 4500k-6000k on there tax bill, it also stated that every home would have a "Senior Tax Lien" on their home until the bonds issued are paid off (up to 2044/45). Our issue is that our home would have this tax lien and our neighbor will not. When we decide to sell our home, the individual who buys it, assumes the tax lien. Our neighbor, would potentially get to sell his home free of this lien.

The other issue we have is that time and time again, we asked if we could payoff the Mello-Roos up front and possibly roll it into our loan. The sales force said this is not an option. The rumor mill has heard rumblings of Pardee giving buyers this option. If this is the case, then I have a "LOST OPPORTUNITY" compared to a new buyer. If you polled the current homeowners, I can gurantee that all but a few would have considered the option to either pay this tax in full or roll it into our loan. Let me repeat myself, I am not opposed to paying this tax assessment, however I was told by Pardee everyone in the community would be subject to the same assessment. Pardee needs to make a decision... is our community a Mello-Roos Community or not.

I wanted to make a quick comment to Perrychase. In the news article, the reference of $150k is in regards to total cost of Mello-Roos payments over the life of the term. This is actualy incorrect, the figure is closer to $200k. If the Net Present Value of this cashflow was calculated today, the figure is more like $75k-$85k depending on home size. Myself and current homeowners will be the first people to say that when Pardee started giving new homeowners free home upgrades, backyards, computers or whatever we did not have a single issue with this. I am happy these people were able to negotiate and get a good deal. If PardeeWhen Pardee started to tamper with the Mello-Roos, the sales force specifically told us, what we do for one, we would do for everybody.

Here is an example of what a builder that "did the right thing". William Lyon Homes is a development less than a 1/2 mile away. The homes are in comparible size to Paree's, they are priced approx $70k to$85k higher, however they do not have a Mello-Roos. At the beginning of the year William Lyon Homes slashed prices by approx. $75k accross the board. They went back to their 1st Phase Homebuyers and gave them money back. This is something that they did not have to do, but "did the right thing"? Pardee's direct response to the price cut is the "no Mello-Roos" offer... approx. worth $75K.

Also, the reference to "picketing" the sales office is misleading. We are not telling people to not purchase a home or this is not a desirable community. We are simply trying to educate people about how Pardee misinformed us and failed to disclose specific information.

I'll keep you posted, we plan to educate more buyers this weekend.

Submitted by ocrenter on January 11, 2007 - 9:37am.

I've always felt the builders have abused the concept of mello roos thru this housing boom. And I hate to say this Bill, you and your fellow buyers allowed the builder to abuse it and took it as a previlige.

Back in 2000-2001 mello roos were uniformly 0.1 to 0.2% on top of the property tax. what was the price of homes then? 50% of what it is currently. So Bill, assuming your Moorpark home was purchased for $1 million. Back in 2001, your mello roos would have been 0.2% of $500,000 = $1,000 per year, or $30,000 over 30 years.

By 2005, all of the mello roos out there in SoCal jumped to .5% or even .8% of the purchase price. Assuming your $1 million dollar home had a .65% mello roos rate, that gets you $6500/year and $200,000 over 30 years.

Did the price of asphalt, power lines, sewage pipes, and illegal Mexican construction workers increase by 666% over 5 years? NO. So why did the mello roos rate increase by 666% over 5 years? And why did homeowners allow the builders to do this to them and say "thank you for the previlige of paying for this, may I have another?"

things for you and your fellow picketters to ponder this upcoming weekend.

Submitted by ocrenter on January 11, 2007 - 9:39am.

I've always felt the builders have abused the concept of mello roos thru this housing boom. And I hate to say this Bill, you and your fellow buyers allowed the builder to abuse it and took it as a previlige.

Back in 2000-2001 mello roos were uniformly 0.1 to 0.2% on top of the property tax. what was the price of homes then? 50% of what it is currently. So Bill, assuming your Moorpark home was purchased for $1 million. Back in 2001, your mello roos would have been 0.2% of $500,000 = $1,000 per year, or $30,000 over 30 years.

By 2005, all of the mello roos out there in SoCal jumped to .5% or even .8% of the purchase price. Assuming your $1 million dollar home had a .65% mello roos rate, that gets you $6500/year and $200,000 over 30 years.

Did the price of asphalt, power lines, sewage pipes, and illegal Mexican construction workers increase by 666% over 5 years? NO. So why did the mello roos rate increase by 666% over 5 years? And why did homeowners allow the builders to do this to them and say "thank you for the previlige of paying for this, may I have another?"

things for you and your fellow picketters to ponder this upcoming weekend.

Submitted by Cow_tipping on January 11, 2007 - 9:53am.

Booo hooo hooo ... my neighbor paid less than I did ... STFU.
You are an FB, you are a GF, you simply put paid $100 a share for and webvan and anticipate it will rocket to $200 a share. You have not looked into the history of crashes and seen this comming 100 miles away. Its time to own up and let the houses fall into forecloseure ... its not like you ever intended to live there very long. You were going to sell it off after it rockets up ... so execute that plan. The fact that it didn't skyrocket, minor detail, its the bank that takes that hit ...

Submitted by blackbox on January 11, 2007 - 11:43am.

Wow, you guys took a $200,000 haircut! Not $150K. Geez, add that with the scarlet letter of being a mello roos property, which will add $100K on the lowball offer, and you have lost $300K on your home overnight. I suppose you want home developers to continue funding your extremely bad decison to buy at the peak of the mother of all housing bubbles! In two years, your property will have a 50% haircut, and you'll be a renter again, with a little less money, and a screwed up credit record. Just because you did not want to miss the train. It was a great time to buy....for the developer, the salespersons, the loan officers, and the constuction dudes. Too bad you didn't stop and think " Gee, how can people on an average income afford today's prices. Maybe I should look at historical income/home prices ratios to determine if a home is overpriced." You probably thought building land was running out, and that the Oxnard area is very, very special. Well, OOPS. Hey someone bought Yahoo at $120, $100, $90, $80............ So welcome to the real world again.... Homeowners. Pull up a chair, grab a beer, and our complementary popcorn. We'll give you a big hug right after we give you a slap behind the head. YOU BONEHEADS!

Submitted by bigtrouble on January 11, 2007 - 12:06pm.

Hey now, lets be fair. A McMansion can hold a lot of Beanie Baby's.

Submitted by IONEGARM on January 11, 2007 - 12:16pm.

Good to see that schadenfreude is alive and well.

Real Estate Headquarters for the SFV and Conejo Valleys

Submitted by lendingbubbleco... on January 11, 2007 - 12:21pm.


Couldn't have said it better myself AND thank you for saying it!

Non-sequitur, but relevant: Any guesses why you are supposed to clench your buttocks tightly before entering the water from a high cliff jump?

These guys in Moorpark are about to find out!!


Submitted by ocrenter on January 11, 2007 - 12:33pm.

It isn't schadenfreude. Seriously, why did buyers ACCEPT a 666% increase in mello roos over a 5 year period? They didn't just take it, they said thank you and let me refer my friends and family.

same with San Elijo Hills. The mello roos + property tax was a flat 1.75% of the purchase price in 2002. But in 2006 when prices of homes tripled, the mello roos + property tax was STILL 1.75%. San Marcos property base tax is 1.25%, so let's just look at the mello roos of 0.5%. In 2002 a 2500 sqft home went for $300,000, meaning a mello roos of $1500/year or $45,000 in 30 years. In 2005 that same 2500 sqft home went for $800,000, meaning the mello roos became $4000/year or $120,000 in 30 years. If mello roos TRULY was meant to pay for infrustructures and schools, that price SHOULD NOT CHANGE between 2002 and 2005. But it did. In this case a 266% increase in price tag within 3 years.

There is really never in history where folks were willing to sit down and agree to such DRAMATIC increases in taxation over such short amount of time.

By virtue of the builders having the ability to just take these mello roos away just like that, you know these DRAMATIC price increases in mello roos over the last few years were simply builders taking advantage of the buying frenzy.

Ionegarm, if you sit down and look at things from this prospective, this is not schadenfreude at all.

Submitted by Daniel on January 11, 2007 - 1:16pm.

Dear William,

Although I'm sorry for your situation, I have to say that, like many others here, I don't think Pardee has done anything wrong. In my view, Pardee has simply decided to reduce the prices of their homes by about $75K (in today's dollars). They could have done it in many different ways: simply reducing the list prices by $75K, or offering incentives worth the same amount, or offering to pay for Mello-Roos taxes, etc. $75K is $75K any way I look at it. You seem to feel otherwise. Would you have been more satisfied if they simply reduced the list prices by $75K?

Regarding the William Lyon example, they didn't just do "the right thing", they went well beyond that by giving previous buyers their money back. Should the market have gone up since Phase 1, I don't believe they would have asked the previous buyers for more money, right?

I was in your shoes in 2005. I had signed up early for a Pardee development in San Diego, at a time when the interest lists were miles long. I was offered the "privilege" to buy a house, and even paid a $15K deposit to reserve it for 72 hours. When my 3 days were up, I politely declined to sign a contract, to the amazement of the sales team (they of course found another buyer down the list in the next 5 minutes). I could have very easily afforded the house, but I chose to walk out. You chose to stick with your purchase. I believe it's only fair that we live with the consequences of the decisions we made.


Submitted by IONEGARM on January 11, 2007 - 1:34pm.

"Ionegarm, if you sit down and look at things from this prospective, this is not schadenfreude at all."

If you sit down and look at the joy people are taking at other peoples loss, it is the definition of schadenfreude.

You can agree that there is a bubble and that some people are now paying for the their mistakes participating in it, but there is a bit of glee that is showing for some around here in regards to it..

Real Estate Headquarters for the SFV and Conejo Valleys

Submitted by BobbyD on January 11, 2007 - 1:46pm.

Not only has the builder abused this but also have the city and county. The builder passes the costs on to the buyer and city and county happily have taken the increased tax revenue even though, as you pointed out, the infrastructure cost basis has not increased proportionate with the home prices. And as many of you have pointed out, the buyers were enablers and willingly paid and allowed it to happen.

To my knowledge, unfortunately there is no mechanism in place to curtail this abuse by the builders/city/county. And they will continue to do it and get away with it as long as the market will bear it. As has been demonstrated previously in the 80s/90s and again today, builders will either pass on the mello roos or absorb it based on the state of the market and a buyer's willingness to pay it. We are in need of real estate tax reform!

It is apparent that Pardee is not selling these homes at a loss and has enough margin to cover the $150K or $200K in mello roos and still turn a profit. Otherwise they would not do it, they will act in whatever manner best serves their financial interests.

Bill, I am no mello roos expert, but my understanding was that you always had the option to pay all of the mello roos up front and it should have been made available to you. I do not know the legalities or regulations around this. But you and the other buyers should look into it. Track down all of the filings for your Mello Roos assessment and the fine print. Pardee and/or the city and county may have acted illegally or bent the rules to best serve themselves. You should further peel the onion.


Submitted by PerryChase on January 11, 2007 - 2:05pm.

Yes, Bill, peel the onion further and if Pardee or the localities acted illegally, they should be made to account.

OCrenter, BobbyD, it sounds like the local officials are all in the pockets of the developers. By working the Mello Roos, the localities created another way for builders to pass development costs onto unsuspecting buyers. I also think that HOAs are also a way to shift costs onto the homeowners. All the while, governments at all levels become more and more bloated. If we, the citizens, are going to pay for everything directly, we need to work to cut government in one-half once every 10 years.

With the proliferation of HOAs, I wonder who will pay for all private road repairs 30 years from now.

Submitted by BobbyD on January 11, 2007 - 3:22pm.

PC, I would agree with you. HOA is another way for the builder to pass the buck on to the home buyers. Professional HOA mgt companies have also become a lucrative cottage industry.

I am not sure that I would call the home buyer unsuspecting however. Although some certainly are and will learn the hard way. But, I am as guilty as the next guy, we have all allowed the market to evolve this way. I could not agree with Daniel more, we all have choices to make and you have to live with the consequences of them.

We all have different circumstances in our lives and buy or sell based our own specific situation. Whatever decisions you make, do your homework, and then be prepared for the risk and reward that goes with your choices.

I am still recovering from my losses from the tech stock bubble, but I learned my lesson and will not make that mistake again. Do I think that we were all scammed and screwed by the VCs and investment banks, who manipulated the market? Yes I do, but I am the idiot who drank the koolaid and bought Qualcomm at $400/share. So I will continue to lick my wounds and live with my decision.

That is why we all come to this site to learn from one another and share information in order to make more informed and better choices in our decisions.

Submitted by North County Jim on January 12, 2007 - 3:01pm.

In my view, Pardee has simply decided to reduce the prices of their homes by about $75K (in today's dollars). They could have done it in many different ways: simply reducing the list prices by $75K, or offering incentives worth the same amount, or offering to pay for Mello-Roos taxes, etc. $75K is $75K any way I look at it.

Exactly Daniel. This is not that hard to figure out. Pardee needed to cut prices and decided paying the MR was the best way to do it.

On a certain level, Pardee did the earlier buyers a favor. With a straight price cut, these would become the new comps, undoubtedly putting some of Mr. Busch's neighbors underwater. With the MR discount, it's a lot less transparent to a prospective buyer.

Submitted by Cow_tipping on January 12, 2007 - 3:26pm.

They are complaining that MR had to be financed ... and not paid off ... but yea ... like any one of these flipping idiots were willing to bite it for 50K straight up.

Submitted by terri on February 12, 2008 - 6:00pm.

I have been looking at this development... for a couple of months...and I wonder if it is worth waiting out to see if the prices come down. Because even though they do get your attn at high 600's for a decent sized home and lot, decent upgrades and a nice sized community with it worth it when you have to pay the mello roos and monthly HOAs(175a month), then another tax from the city for the maintenance outer part of the subdivision (police and fire protection)and then the county property tax? That sounds like an awlful lot extra monthly expense...and all the from the 650's is starting to sound very expensive.

I am so frustrated with Ca real estate. Nothing is ever what it seems.

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