San Diego Housing Bubble News and Analysis

Why not rent for a year or two at least? wait and see what the RE market is doing. This way you can rent a nicer bigger detached house in a nice quiet neighborhood. Keep your cash.

I assumed I'd take a tax hit if I didn't reinvest my capital gains in the same year that I received them, from the sale of our current home. Is that not correct?

Consult your tax advisor but no tax hit. Rent.

Yes and no, I believe the 1st 500k in capital gains (appreciation on your house) is tax-free provided it is your primary residence for the last 3 or 5 yrs.

If this is not the case, you have 6 months to use your capital gains to buy another property before the govt takes long-term capital gains (15% tax). This is called a 1031 exchange

I am not an accountant or tax attorney so take it all with a grain of salt

I just did a quick check on CL and rents are higher than what I calculated a mortgage payment to be. On homes in the same size range as I thought I could get into. Nicer, better maintained and upgraded, but still....

I live in UC, send my kids to Curie, and follow the rental and sales market here.

There is starting to be a crack in prices - a house on Weller just went pending with a list price of $320k. (Super low for this neighborhood.)

http://www.sdlookup.com/MLS-090060565-69...

I've also seen more and more houses for rent. Just on one stretch of Pavlov there are 3 or 4 "for rent" signs. 2 of those are going through realtors - so they may or may not be on Craigslist. I've also seen a lot of "for rent" signs down on and around Robbins.

The rent prices may be negotiable - especially as landlords figure out they have competition.

Don't rent from G. Forgey on Robbins. Dishonest.

Seriously consider renting. Post-divorce is a time when you need, above all, some flexibility. I know you think you need stability, but buying a house doesn't really give you stability. Unforseen things come up and may force you to move regardless of your housing situation. In fact, if you are renting and lose your job, you may be able to stay in the house, but if you are paying a mortgage and you lose your job, you may have to sell. You just never know what will happen, especially in these economic times.

Even if rents are a little higher than a mortgage payment, you don't force yourself into a situation that may restrict your options later.

Renting - means you can check-out of the rental and buy any time.

Buying - means you can only sell and change your housing situation if the market goes up. If the market goes down, you are losing money and may be forced to sell after taking a loss.

If prices are headed up for sure, buying makes more sense. Not only do you make money on appreciation, but you aren't locked into the house because you can sell it for a gain, which is easy.

But when there is some suspicion that prices can come down, renting really makes alot of sense.

Also, you can close a rental deal in a week, vs. a purchase that could take time, energy and stress.

Renting gives you time to execute that short sale which could land you in a nice house for less.

Consider as a single parent, doing a remodel is much more challenging that it is with two parents. You'll be unusually short of time for the next year, I'd guess.

Waiting to purchase in this market is just a good thing to do, and you'll need a year or two of waiting. You'll be so much happier buying later rather than earlier.

It also gives you time to evaluate your decision - condo vs. house. Rent a condo for a while. If you hate it, buy a house. If you love it, buy a condo.

Go the route with low-stress and max flexibility.

Rent.

Well said, sduuuuude. I had been divorced and it's enough upheaval and it takes a lot of time until you REALLY sort all kinds of things out - within yourself and with others. With kids, that makes at least twice as complex, I can only guess. You don't need the stress of looking for, submitting offers, buying & remodelling a house, especially if you are single parent. You really have to have a very clear, non-stressed head when you buy, to not be preoccupied about other stressful things. Right after divorce, and selling your current house - that's enough stress without adding to it worry about your purchase if you have to sell at some point for whatever reason, or if the prices go south, or if you take a paycut or whatever. Even if the market would be relatively flat & long bottom I'd still suggest you rent.

Think also about the emotional support you need to provide to your kids, and extra time involved. You don't need your mind on other time-consuming things - as a house purchase. Make it as least stressful and as painless as possible. One thing at a time. First, REALLY adjust to the life as a divorced mom. That would take at least a year, then you can re-visit the idea of purchasing a home with a clear head. So... RENT.

Another useful advice: Rent something nice so you feel pretty good in this home, because you need that after a divorce, you don't need anything else that makes you unhappy/sad/annoyed. Rent something as nice as your current house, even if a bit smaller. Even if the rent is a bit higher than a mortgage, if the place is worth it go for it (but negotiate down if you can). After all you probably won't be in that place more than 1-2 years, so that extra cost is worth at this time in your life.

Thanks everyone. I appreciate your thoughtful compassionate answers. I really hadn't considered renting, and it makes a lot of sense. I will re-evaluate once I get closer to spring and selling but at the very least it gives me an easy no stress option.

I've been renting in two different condos in UC for the past 2 years, and one thing you don't have to worry about are kids partying. This is UC, not College Area, the students seem to be nerds/bookworms.

In my last complex, i had students complaining about the subwoofer for my home theater system.

Jameswenn any insight into which ones have 3 bedrooms and opinions on layouts, HOA, parking, plumbing, etc?

Here is a map of all UTC condos, so you can do some digging on which condo projects you are most interested in. I think you will get better feedback if you ask by name of the complex, plus you can figure out geographically where would be better for you before you get in the car. If you click on the links, there's stuff about how many have sold recently, how many bedrooms are in that project, year built (clue as to likely needed maintenance), etc. :

http://www.utc-condos.com/

In general, parking is terrible near most of the UTC condos -- I would suggest making sure you have a reserved parking spot/garage for you. I think most condos in UTC give you that for at least one car. If you have a teen with their own car, make sure they have reserved parking. Last year there was a car-window smasher that would go on the Via Alicante area and mess up the cars parked on the street. There have also been thefts of cars in this area that were parked near the street, even if they were in the "driveway" (private road) of the condoplex.

Advice about renting from Craiglist:

Ask when major maintenance (roof replacement, termite tenting) was done that might cause you to have to move out during your lease. Choose accordingly.

Ask your colleagues, friends you trust, etc. about HOA finance gossip -- e.g. Place A is solid, Place B is shaky and doesn't have money to fix the roof, etc. Verbal is good; it counts as hearsay should any condo complex take umbrage at "defamation". But if you narrow it down and go look yourself what condition the properties are in, you'll figure this out even without the rumors.

And for goodness sake, run Google and the property tax search on your potential landlord to a) see if you can verify the person talking to you really is the owner; and b) if they are behind in their taxes, they're probably foreclosure bait -- don't add unnecessary stress and steer clear.

Costa Verde apt. and towers have 3 bdr, but they are expensive - over $2000. La Jolla Colony has some 3 bdr townhomes or homes (Madrid, Las Palmas, Barcelona) that rent usually on CL around $2000 and over. La Regencia has only a handful of 3 bdr. , cheaper. It's a nice & convenient part of town, so for 3 bdr you probably would fork close to $2000 at least in these complexes that I know. Cape La Jolla also have 3 bdr. condos, but few come on the rental market.

I have friends renting in the Valentia apartments - over by the new park/library off of Nobel/Judicial. They're in a 3 bedroom + loft.

La Jolla Crossroads - new apartments - they have 3 bdr or 3bdr + loft too. I think it's also ~2000/mo. Near Valencia.There is also Villas of Rennaisance, but the rooms are smaller.

Edit:
There is also Trieste on Mahaila (or corner of Nobel & Regents). There are 2 other complexes on Regents called Regents something or other that have 3 bdr. Avanti, Vista La Jolla, University Town Square on Nobel,are newer 3 story townhomes that somethimes are for renting. Also, Southpointe, a few of the Cambridge (on Villa La Jolla). EastBluff, Marbella, Playmor, Andria all have 3 bdr.

What size of condo are you looking for renting?

I've only looked for 2 bed 2 baths, but one thing I can tell you is that the market does move around the school year. The prices do seem higher during the end of summer, early fall, when the traditional school year starts.

When i moved to the current bigger unit i'm in, i just checked craigslist weekly. You might want to be careful about renting directly from an owner, i only look for something with a management company, they also seem to be a bit cheaper month to month, but require a full month's deposit.