A Short History of Irvine—a Master Planned Community
Back in the 1960’s, Irvine was to be a model for a master-planned community. Envisioning an initial population of around 50,000, and built around a newly designed and constructed university, the plan was the inspiration of William Pereira, a visionary architect, who was commissioned by the University of California, in collaboration with the then chief planner for the Irvine Company, Raymond Watson, to create a mixed-use town designed for the new campus campus that would be at the center, and surrounded by neighborhoods of homes. Each neighborhood or “township” would be divided into “villages” radiating out from the center which would become the University of California at Irvine.
The villages were designed to each have a distinctive architectural theme. Each village was to have its own greenbelts, parks, commercial centers, religious institutions religious institutions and schools—in short, self-contained neighborhoods mirroring a small town concept within an ever growing and evolving entity. By 1970, the villages of Turtle Rock, University Park, Culverdale, the Ranch, and Walnut were developed, and on December 28th, 1971, the residents of these villages voted to incorporate and expand the city of Irvine.
Why We Decided to Move to Irvine, California
After having researched Irvine’s planned community concept, and wanting to move from Tucson’s Sonora desert to a more temperate coastal climate, we were impressed with the layout of the city with its open space, greenbelts, beautifully planned neighborhoods, excellent schools schools, overall convenience to local and regional shopping centers, freeways, proximity to the larger metropolitan areas of San Diego to the south, and Los Angeles to the north, and, of course, within a few miles of the Pacific Ocean.
A Time of High Interest Rates and Creative Financing
When Eric transferred to an investment/brokerage office in Newport Beach’s Fashion Island, we picked up stakes in Tucson and moved to the city of Irvine. The overall population of Irvine was less than 70,000 residents. At that time residential real estate sales were slowed by extremely high interest rates interest rates and buyers and sellers had to resort to “creative financing” in order to be able to finalize a sale or purchase.
You Own The Land and Not the Mineral Rights?
Coming from the wide open spaces of the West where your property is yours up, down, around, and back, it was a bit of a shock to discover that the Irvine Company reserved the mineral rights to the property under which your house sits. At first it did not sit well. However, as we had no plans to construct an oil well on our property, we swallowed hard and purchased our first home home in Irvine without the right to dig or otherwise extract the minerals from our land.
You Own the House but Not the Land? What Up With That?
Back then some properties in Irvine and in Newport Beach could be purchased and sold without the land. The Irvine Company held 99-year leases on these properties. This made these types of home purchases initially more affordable, but grew problematic when the land started appreciating by leaps and bounds with the growth of the city. In the mid 1980’s, the Irvine Company came to a legal accommodation with those property owners in Irvine and Newport Beach that wanted to opt-out of their leaseholds, allowing those homeowners the right to purchase the land for a pre-determined price during specific timeframes, thus diffusing a volatile issue among long-standing property owners.
Rapid Development of Irvine during the Mid 1980’s
Irvine was growing rapidly, and we witnessed a burst of building during the early and mid 1980’s that would expand Irvine’s villages to included the village of the University Town Center (built between 1981 and 1988), added homes to the older village of Turtle Rock, including the Turtle Rock Bren homes (now renamed Turtle Rock Meadows), Turtle Rock Pointe, Turtle Rock Crest, Turtle Rock Ridge, started to build out Westpark 2, (the older village/community of Culverdale was later re-named Westpark 1), embarked on building out south Woodbridge, continued expanding an area of Walnut along Harvard Avenue, added neighborhoods to the older village of Northwood—in short ramped up the expansion and development of the ever enlarging city of Irvine. Bean fields and Orange groves gave way to subdivisions and new villages and neighborhoods.
Creation of the First Housing Bubble
During the last part of the 1980’s, we witnessed the creation and the bursting of the first housing bubble, as properties dramatically increased in value from the mid 1980’s and topped out during 1989-90. As you may recall, high interest rates (in the 13-18% range) started coming down around 1986. Fixed rates were still in the 10% range. However, adjustable rate mortgages were beginning to be proffered as an alternative way of financing. These adjustable rates started around 7%. Thus the era of negatively amortized mortgages was born—allowing buyers to defer a large portion of their housing payment (similar to what credit card companies offer), and to presumably make the ability to buy and sell homes more affordable. The 1980’s also saw the establishment of the Mello-Roos Community Facilities Act.