[quote=joec]Another thing with sweat equity is does it make sense to instead just work harder or do overtime at your current job if you make a decent living instead of spending the time to do the sweat equity yourself?
My dad was decently paid in his profession and never did a lot of stuff around the house himself. Just do a week of overtime and that pretty much pays for any sweat equity you had to use time on.[/quote]
This is true, joec, if there is little sweat equity in a property (=<$20K). But when you consider properties that may have $80K - $150K sweat equity in them, the rewards are VERY high to spend time on DIY, even if it takes 3+ years in your spare time to get it up to snuff. You have to live somewhere.
IMHO, when you work more away from home, you often just end up more stressed and pay more taxes. It might be LESS stressful for some "high-earners" to spend their "spare time" listening to an i-pod while sanding old coats of paint off a mahogany staircase in Mission Hills (instead of working OT).
I've never been in the "high-salary" category. But manual labor I can do :=}
In the past, I was able to purchase properties with my former spouse that buyers at (or above) our "educational levels" typically could not purchase (didn't know how/no wherewithal/no motivation to save any money or do labor on weekends). You may be surprised at how easy simple plumbing stuff is to do such as install garbage disposer, faucets, drains, and undersink pipes, for example. You can save a BUNDLE if you can do stuff like this yourself. Street smarts and manual labor is what got me the to the level of financial security I enjoy today and for my future.
[quote=joec]Another point is why compete with folks who has the sweat equity? Focus on skills you have and let someone else go hog wild on these fixers...At least that's what a lot of these buyers think.[/quote]
I agree that when a property is a "heavy" fixer, i.e. a structural fixer, or the lot suffers from subsidence, sometimes these are best left to the professionals (to pick up as an REO or off the courthouse steps) who have the equipment and manpower to make them stable and habitable.
[quote=joec]Probably true for a lot of the dual income professionals you see buying in places like Scripps Ranch, Del Sur, 4S...[/quote]
Many properties in Scripps Ranch are 70's and 80's cosmetic fixers, some situated on large lots. There may be properties available there with "sweat equity" built into them. IMO, the other areas you mentioned are money-sucking in that they will not contribute to an owner's bottom line unless they can hold on for many, many years until after the MR bonds are retired. Even then, a longtime owner would have "invested" so much money into the bonds/HOAs by then that there is no guarantee of the return of any of this "investment" upon sale.
**********************
joec, I think it's very possible for a worker such as yourself to purchase a property in your "dream" areas of DM and LJ if you can obtain something, by hook or crook, with "sweat equity" built in. This will NOT be easier or cheaper to do when you are older. But you will have to be a very patient and persevering buyer who is decisive when you have found your property and act quickly. And lose the attitude that the property must be perfect upon move in. And, in some cases, dispel your illusions about the amount of "square footage" that you think your family needs. A LOT of these properties in your coveted areas of DM and LJ are owned by baby boomers (like myself), who may just as likely NOT have a college degree as do have one. It was no less easy for them to qualify to buy these "fixers" for $80K to $120K in the late seventies than it is for you to qualify to buy new construction at $750K today. After acquiring the property, many of them had to WORK on them, for years on DIY projects and maintenance. Maybe expansion and remodeling projects were undertaken over the years as well. You may drive by one of these properties at the top of the Muirlands today and think, wow, that's beautiful, look at that driveway, landscaping, etc. And is that a whitewater view from the backyard? Those people must be RICH. They were so LUCKY. Why can't I do that?? Why is it SO EXPENSIVE now?
You have no idea what these owners had to do or go thru (lengthy coastal commission hearings and neighborhood opposition to permits, etc) to get the property the way you see it today. Often, at the time they purchased these properties, they may not have been "habitable" by your standards.
Enough rant. I just feel if a homebuyer is going to spend a goodly sum of their hard-earned $$ purchasing a property, it may as well ADD to their net worth upon sale instead of detract from it. Otherwise, it's better to rent. This is truer today than it has been in a long time.
