drunkle: “what would you do or think if the value of the place dropped as low as 125k? or even lower? 190k for a condo in escondido still sounds absurd…”
How don’t know how much a place like this would rent for but @ 190k @ 5.25% 30 year fixed, the mortgage payment would be around $1000/month and @ 125k @ 5.25% 30 year fixed, payment would be around $700/month. That’s one way to do the comparison.
“To get an idea of how low this condo MIGHT go, just look up the price of it, or comparable condos, in 1996-1998. Add 40% for inflation.”
I don’t really agree with this logic because interest rate make a big difference. $125k @ 9.5% yield the same monthly payment as $190k @ 5.5%. It might be more logical to say, take 1996-1998 monthly payment and add 40%. Then you’d remove the interest rate variable.
