Start by finding how much a similar house in the neighborhood rents for. Then take your 20% down, 80% fixed rate 30 year mortgage, add property taxes and maintenance and subtract the tax deduction. When this number is pretty close to the rent number, that’s a good price. I could see paying maybe a hundred more per month to own than rent if I really liked the place. Oh also, don’t forget that your 20% down payment can earn over 5% annually in CDs these days (you’ll lose 100% of that when you buy), and that if you work for yourself you can write off a portion of your rent for your office. My guess is that when you really do the math, you’ll find that most prices in San Diego are still too high.
My predictions?
* Leaping from condo balconies will gain popularity as a suicide method in 2007
* A rash of mysterious home and condo fires will sweep southern California in 2008
* In 2009, workers in housing-related industries will transition to careers with higher demand for workers, such as strawberry cultivation, garden maintenance, and home cleaning
* Downtown condo HOAs will modify their bylaws to allow balcony vegetable gardens and the keeping of chickens as “pets” in 2010
* 2011 might be a good time to think about buying a house in SD
