[quote=Diego Mamani]”Now the home is worth $300-$350k”
I think that’s still grossly overpriced. If the house would rent for about $2500/month, sales price should not be much higher than $250K.
I know, this is an OT remark, but couldn’t help myself. A new guy in my office (west San Fernando Valley) is about to pay close to $500K for a small house that wouldn’t fetch more than $2000/month in rent. He doesn’t want to lose his $8000 tax credit, I guess (duh!)[/quote]
larger sfr’s don’t usually get to the same multiplier as smaller ones and condos, but I do agree it won’t fetch 2500 in rent, murrietta didn’t have many places in the bubble where 2500 sq rented for 2500, 2500 is a tough rental price point here because at that rate, you can buy anything. My 3300 sq fter in a better location is probably worth just around 2k rent, doubtful it would fetch 2200 or 2300, but a 1500 sq ft house will fetch 1500, it’s just the way it is, there is a cap on rent in a way.
Your buddy better check the tax credit rules, the income restrictions almost put 500k houses out of range. 75k for a single, 150k for a couple, since you can only borrow around 3x income, if he’s single and wants 500, he makes too much for the credit, if he’s married it’s gonna be close. Very few people in so cal qualify for the credit, in order to qual for the loan your income needs to be higher than they allow.
