Advice Needed

[waitingpatiently]

Hi everyone,

My husband and I are devoted Piggington readers and would appreciate the advice of the “group”.

Here is our situation…
We sold our house in Feb of 2006 and made a $400 grand profit, it has been sitting in cd’s while the market plays itself out. We don’t mind renting until we hit the bottom (its actually kind of nice not having to worry about certain things). Our problem is that our daughter will start school next year and would like to be in the school district where we will buy. Our “dream house” would be a 4 bedroom/3bth west of the 5 in Encinitas. Although, there are developments that we like East of the 5 (sante fe trails and la costa valley). Are there anymore we should be looking at? We are not going to spend more than $750 (we would qualify for more, but we max out 401ks and don’t live on credit cards). My question is…what school would you choose in Encinitas? Do you think that prices will drop that much on the coast? Should we pick a school and hope that we find a house to buy when the time comes, or should we not care so much about switching schools we finally buy.

Our lease will expire in October and we will be moving to our “forever” city in May (to get situated before the school year starts).

We would like to thank EVERYONE on this forum for their data/advice. When we sold our home people thought we were crazy. Everynight before we go to bed we read the latest posts and feel good that we made the right choice. We figure we are so young (29) that even if it doesn’t play out we still have time!!!

Thank you,
Waiting Patiently

[SD Realtor]

Not many 29 year olds have 400k banked. You guys have done a GREAT job.

There was actually a listing west of 5 in 92075 that listed at 795k but went into escrow in a matter of days. It was not anything special but it was encouraging to see that sort of pricing. Also I “believe” it was an as is sale so I wonder if there were some major issues….

Anyways if schools are the big thing then pick the school and find a rental in that district. If it means you pay a premium then so be it. I think you will see some price contraction west of 5 in Encinitas but no way will I give an estimate because I don’t believe it will be as large as other areas in town. Still though, even a 10-20% depreciation on say a 950k home gets into the price range you want.

Hey and 5% on 400k for say two years is another 40k (less taxes) … not bad considering there is no risk…

SD Realtor

[SD Realtor]

Not many 29 year olds have 400k banked. You guys have done a GREAT job.

There was actually a listing west of 5 in 92075 that listed at 795k but went into escrow in a matter of days. It was not anything special but it was encouraging to see that sort of pricing. Also I “believe” it was an as is sale so I wonder if there were some major issues….

Anyways if schools are the big thing then pick the school and find a rental in that district. If it means you pay a premium then so be it. I think you will see some price contraction west of 5 in Encinitas but no way will I give an estimate because I don’t believe it will be as large as other areas in town. Still though, even a 10-20% depreciation on say a 950k home gets into the price range you want.

Hey and 5% on 400k for say two years is another 40k (less taxes) … not bad considering there is no risk…

SD Realtor

[SD Realtor]

Not many 29 year olds have 400k banked. You guys have done a GREAT job.

There was actually a listing west of 5 in 92075 that listed at 795k but went into escrow in a matter of days. It was not anything special but it was encouraging to see that sort of pricing. Also I “believe” it was an as is sale so I wonder if there were some major issues….

Anyways if schools are the big thing then pick the school and find a rental in that district. If it means you pay a premium then so be it. I think you will see some price contraction west of 5 in Encinitas but no way will I give an estimate because I don’t believe it will be as large as other areas in town. Still though, even a 10-20% depreciation on say a 950k home gets into the price range you want.

Hey and 5% on 400k for say two years is another 40k (less taxes) … not bad considering there is no risk…

SD Realtor

[Ex-SD]

Houses along the nicer coastal areas will probably drop less (in %) than many of the other areas of SD but they too will drop. I used to live in Leucadia for many years. I just went on Redfin and looked at the map of properties for sale and I notice that there are several homes in Skyloft that were asking $900k+ a year and a half ago…..now around $799k and a couple are long term owners so they have smelled the air and figure that it’s time to cash out. My guess is that the coast properties will drop another 25-30%+ from where they presently are if borrowers will now have to qualify for a mortgage with proven income, rates remain high for jumbo loans and foreclosure sales drive the comps down. It’s a good time to have a lot of cash and not be a homeowner so you can afford to rent and wait for the storms to pass. I would rent for a minimum of three years because I think this whole thing is not going to be over for a minimum of three and as long as five years and when it hits bottom, prices are not going to ramp up quickly again.
Can’t help you on the schools since my kids all finished the local high schools in the Encinitas area a long time ago and I have no idea how much they may have changed.
Good luck and congratulations on being smart enough to cash out while the getting was good.

[Ex-SD]

Houses along the nicer coastal areas will probably drop less (in %) than many of the other areas of SD but they too will drop. I used to live in Leucadia for many years. I just went on Redfin and looked at the map of properties for sale and I notice that there are several homes in Skyloft that were asking $900k+ a year and a half ago…..now around $799k and a couple are long term owners so they have smelled the air and figure that it’s time to cash out. My guess is that the coast properties will drop another 25-30%+ from where they presently are if borrowers will now have to qualify for a mortgage with proven income, rates remain high for jumbo loans and foreclosure sales drive the comps down. It’s a good time to have a lot of cash and not be a homeowner so you can afford to rent and wait for the storms to pass. I would rent for a minimum of three years because I think this whole thing is not going to be over for a minimum of three and as long as five years and when it hits bottom, prices are not going to ramp up quickly again.
Can’t help you on the schools since my kids all finished the local high schools in the Encinitas area a long time ago and I have no idea how much they may have changed.
Good luck and congratulations on being smart enough to cash out while the getting was good.

[Ex-SD]

Houses along the nicer coastal areas will probably drop less (in %) than many of the other areas of SD but they too will drop. I used to live in Leucadia for many years. I just went on Redfin and looked at the map of properties for sale and I notice that there are several homes in Skyloft that were asking $900k+ a year and a half ago…..now around $799k and a couple are long term owners so they have smelled the air and figure that it’s time to cash out. My guess is that the coast properties will drop another 25-30%+ from where they presently are if borrowers will now have to qualify for a mortgage with proven income, rates remain high for jumbo loans and foreclosure sales drive the comps down. It’s a good time to have a lot of cash and not be a homeowner so you can afford to rent and wait for the storms to pass. I would rent for a minimum of three years because I think this whole thing is not going to be over for a minimum of three and as long as five years and when it hits bottom, prices are not going to ramp up quickly again.
Can’t help you on the schools since my kids all finished the local high schools in the Encinitas area a long time ago and I have no idea how much they may have changed.
Good luck and congratulations on being smart enough to cash out while the getting was good.

[PerryChase]

I agree with Ex-SD. Listen to Ex-SD, bugs and others who have seen the 1990s crash and have experience with declining values. Like Ex-SD suggested, look at redfin.com and sdlookup.com for price histories of houses 1986-1997 and 2000-2006. That will give your a good range of possiblities.

$750k will be plenty of money for that “forever” home you’re looking for in Encinitas.

Rent for at least 3 years and wait things out. Rein in the emotional desire to own and you’ll find a killer deal at the best price.

When people are positive and forward-looking, I’ve learned to discount whatever they say by 50%. People don’t have the income or the staying power that they project. Boasting is a human trait. I’ve been right every time.

As far as schools go, don’t worry about switching schools. Kids are more adaptable than you think. Change can be good and will teach your kids to be stronger.

Yes, congratulations on a smart decision. 🙂

[PerryChase]

I agree with Ex-SD. Listen to Ex-SD, bugs and others who have seen the 1990s crash and have experience with declining values. Like Ex-SD suggested, look at redfin.com and sdlookup.com for price histories of houses 1986-1997 and 2000-2006. That will give your a good range of possiblities.

$750k will be plenty of money for that “forever” home you’re looking for in Encinitas.

Rent for at least 3 years and wait things out. Rein in the emotional desire to own and you’ll find a killer deal at the best price.

When people are positive and forward-looking, I’ve learned to discount whatever they say by 50%. People don’t have the income or the staying power that they project. Boasting is a human trait. I’ve been right every time.

As far as schools go, don’t worry about switching schools. Kids are more adaptable than you think. Change can be good and will teach your kids to be stronger.

Yes, congratulations on a smart decision. 🙂

[PerryChase]

I agree with Ex-SD. Listen to Ex-SD, bugs and others who have seen the 1990s crash and have experience with declining values. Like Ex-SD suggested, look at redfin.com and sdlookup.com for price histories of houses 1986-1997 and 2000-2006. That will give your a good range of possiblities.

$750k will be plenty of money for that “forever” home you’re looking for in Encinitas.

Rent for at least 3 years and wait things out. Rein in the emotional desire to own and you’ll find a killer deal at the best price.

When people are positive and forward-looking, I’ve learned to discount whatever they say by 50%. People don’t have the income or the staying power that they project. Boasting is a human trait. I’ve been right every time.

As far as schools go, don’t worry about switching schools. Kids are more adaptable than you think. Change can be good and will teach your kids to be stronger.

Yes, congratulations on a smart decision. 🙂

[cashflow]

We are a bit like you guys as we cashed out in Feb. 06 and have a young family (expecting #2 any day now). I have the same concerns at getting my daughter into the right schools, but she is only 2 1/2 now so I have a bit more time. If I were you I would try and get a rental at least in Encinitas. This would at least put you in the school district you want. I have a friend that taught in the area, I will ask her for an assessment of the different schools and post it sometime this week.

I too don’t think it is such a big deal to move within the same area if you have to when the time comes to buy a home. If your child is just in grade school they will adapt very well. (on the other hand if my child was late Jr. High or beyond, I don’t think I’d want to disrupt their school ties).

Best wishes for your decisions. I also congratulate you on having that much cash in the bank at your age (we’re just a bit older than you). You have done all the right things up to this point for you and your family’s future and now we just have to keep emotions out and stay the course!

[cashflow]

We are a bit like you guys as we cashed out in Feb. 06 and have a young family (expecting #2 any day now). I have the same concerns at getting my daughter into the right schools, but she is only 2 1/2 now so I have a bit more time. If I were you I would try and get a rental at least in Encinitas. This would at least put you in the school district you want. I have a friend that taught in the area, I will ask her for an assessment of the different schools and post it sometime this week.

I too don’t think it is such a big deal to move within the same area if you have to when the time comes to buy a home. If your child is just in grade school they will adapt very well. (on the other hand if my child was late Jr. High or beyond, I don’t think I’d want to disrupt their school ties).

Best wishes for your decisions. I also congratulate you on having that much cash in the bank at your age (we’re just a bit older than you). You have done all the right things up to this point for you and your family’s future and now we just have to keep emotions out and stay the course!

[cashflow]

We are a bit like you guys as we cashed out in Feb. 06 and have a young family (expecting #2 any day now). I have the same concerns at getting my daughter into the right schools, but she is only 2 1/2 now so I have a bit more time. If I were you I would try and get a rental at least in Encinitas. This would at least put you in the school district you want. I have a friend that taught in the area, I will ask her for an assessment of the different schools and post it sometime this week.

I too don’t think it is such a big deal to move within the same area if you have to when the time comes to buy a home. If your child is just in grade school they will adapt very well. (on the other hand if my child was late Jr. High or beyond, I don’t think I’d want to disrupt their school ties).

Best wishes for your decisions. I also congratulate you on having that much cash in the bank at your age (we’re just a bit older than you). You have done all the right things up to this point for you and your family’s future and now we just have to keep emotions out and stay the course!

[waitingpatiently]

Thanks for the posts….we are planning to rent until it makes financial sense to buy. We read this blog everyday to keep us motivated NOT to buy!!!
Cashflow… I would love to have a teachers perspective of the schools in Encinitas and where he/she thinks the school district is headed.

Waitingpatiently

[waitingpatiently]

Thanks for the posts….we are planning to rent until it makes financial sense to buy. We read this blog everyday to keep us motivated NOT to buy!!!
Cashflow… I would love to have a teachers perspective of the schools in Encinitas and where he/she thinks the school district is headed.

Waitingpatiently

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